Financial Planning for Female Breadwinners ft Sara Gelsheimer (EP.149)

0:28We all need to make smart decisions with our money. by returning guest, Sarah Gelsheimer, who's a senior wealth manager and shareholder at PlanCorp. Sarah has carved a remarkable career path with a profound commitment to empowering women in finance. And in our conversation today, we'll explore several topics that, while important for everyone, hold particular significance for many women managing both their careers and their personal lives. Having worked with Sarah for more than nine years at this point, I've had the great privilege of hearing her observations, as well as the advice for women who are the primary earners in their households.

1:05And so if that is you, I think you're really going to enjoy this episode. And if you know somebody who fits that description, I'd really encourage you to forward this episode to them because we're going to be discussing both the specific financial and societal challenges that that group faces, as well as the strategies that can help manage these responsibilities effectively. As always, you can find detailed show notes and links to all the resources that we mentioned throughout the episode at thelongterminvestor.com. And now, without further ado, here is my conversation with Sarah Gelsheimer. Sarah Gelsheimer, welcome back to The Long-Term Investor.

1:48Thanks for having me back. You know, we've had you on the show a few times, but I have never had you share your path to becoming a financial advisor and sort of how you've focused in on a certain type of person that you help most frequently. Do you mind starting us there? Yeah, sure. Absolutely. I would say I don't have a traditional path to this industry, but I also think it's really helped me get to where I am. So I went to Murray State in Murray, Kentucky, go racers. And I was actually studying to be a social work major because I wanted to help people. And my mom is a social worker and I idolized her.

2:26And I thought, you know what? I want to do just what she does and help people every day. So I was in my social work classes, decided to take a basic finance course just for my own benefit, my own knowledge, you know, thinking, okay, I'm going to make money one day. I should probably know what to do with it. I'll be at not much money as a social worker, but I wanted to at least have a baseline knowledge of finances. So I took this basic finance course and about halfway through the semester, my professor, who I'm going to give a shout out to, Dr. David Durr, he pulled me aside. He said, Sarah, why are you not in finance?

2:56You're the only social work major in this class and you are actually at the top of the class. And I was like, well, thanks for asking, but I don't want to sell something. I have no interest in sales. But there's this whole other world of finance, the CFP, Certified Financial Planning Designation, where you actually are helping people every day and still getting to use numbers. And I had a knack for that. So he really opened my eyes, this whole other world of financial planning that I did not know existed. And I think that's probably a pretty common misconception that it is all sales when it's really not.

3:31So ended up doing both financial planning and social work. I think I'm probably the only person in the history of Murray State to do both of those tracks. But I will say, especially after working in the financial industry for over 15 years now, that social work background has actually helped me immensely as well. So anyway, fast forward, I ended up pursuing finance as opposed to social work. And it really didn't take me long before I started noticing this trend that often it was the male who was coming to the meetings, or at least much more engaged when we're talking about a husband and wife situation.

4:08And that really bothered me. I was like, man, why are females either not coming or when they were coming, we're often less engaged, not asking as many questions. And just, you could tell it was the male who was driving the financial decisions in the household. And like I said, it kind of bothered me. Now I have to put in a caveat that I am painting with a wide brush, right? I mean, I certainly have seen it, the roles being reversed, one of which is my household, but it bothered me and I wanted to do something about it. So that's really what pushed me to start our women's initiative here at PlanCorp called Inspire Her, where we're on this mission to help women gain more financial confidence, ask more questions, and really get more involved in their financial life.

4:47And it's been one thing that makes me excited to wake up every morning. I appreciate you sharing all that. And I'm glad you also emphasized there's nothing wrong with there being one person who takes charge of the finances. But I think you'd agree with me that if it isn't at least collaborative, then our job being the ghost writer of the life that you want to live is a lot harder if one of those people aren't having input within it. And I know that a lot of your passion, again, not exclusively, but heavily has had you focused on female clients of different stages in life. Today, I was sort of hoping we could focus on some of the common challenges that you see among your clients who are female and the primary breadwinners within their household.

5:32Let's just start there. I mean, what are some of the things that you see among that group that they are typically facing financially or otherwise? We're in a time now where there are so many dual income households, which there's just so much that comes with that, that there's lots of things to do from doing stuff for your job, child rearing, sports activities, running a household. So that burden is getting put on two people who are both trying to work full time. So I would say one of the biggest things that I've found really with male or female breadwinners is time, right? So having the time to spend and dedicate to your finances can be a challenge.

6:11And oftentimes that gets put on the back burner. And certainly different areas where you don't feel as confident or you dread, you know, a lot of people don't like talking about money and the things that we dread and don't like, we often procrastinate on. And I think this is one area that that naturally happens for, particularly for women, because I've seen it a lot where women say, Oh, I don't like talking about money, I'm not comfortable with it. So it often does get put on the back burner. So I think just like anything else, prioritizing your time to figure out exactly when you're going to dedicate some time to actually sit and think about your financial goals is incredibly important, whether you're male or female breadwinner.

6:50And I would say in addition to prioritizing your time, one of the things I have found that I do most in working with clients is helping them prioritize their cash flow. So especially if they are in a dual income household, they often have excess cash flow to work with, which is great. And there are so many different vehicles to save into, you know, high yield savings accounts, retirement accounts through your employer, IRA, Roth IRA, 529s, taxable accounts. So there are so many different options that it can often be overwhelming for clients to figure out, okay, which ones do I start with? How much should I put into each?

7:22And that, of course, like any other answers, like, well, it depends. It depends on your goals and your situation. I mean, somebody who's focused really on paying off their home, for example, I just talked with clients last week, new clients who said, should we pay off our mortgage early? And they're in their late 30s. And the numbers answer to that is no, doesn't make sense. But for them, it was really important. He is a high earner, but he's actually changing careers. and he's going to start a career where his income is going to drastically be reduced. And so his wife will then become the female breadwinner.

7:56And so for them, getting rid of their biggest expense before that time comes was really important. So for them, it was, yes, how can we prioritize your cash flow right now to pay more towards the mortgage and less towards other things? So that's something that's really important to people who have that excess cash flow, who are breadwinners, and just trying to figure out how to take what they've earned and maximize it to best go towards all their goals. That is a great example of one of my favorite sayings, which is that we don't live in a spreadsheet. And so often the math answer and the what is right for you answer aren't always perfectly aligned and that's okay.

8:32I know you aren't exclusively working with women, but there is a high concentration for you of where the woman is either the primary decision maker or the breadwinner or both. Do you feel like you approach financial planning differently for women who are in that position? And if so, like, what are some things for those listening that they would expect to hear done differently for them? Yeah, there's a lot of research out there about serving women is very different from a financial perspective than serving men. I mean, purely from a statistical standpoint, women live longer, they have higher medical costs often associated with that.

9:08They generally make less money. And they more often than not, or between a male and female, are the ones that take time off or at least cut back from work to raise children or care for aging parents. So all of these different factors really create a headwind for females. So those are all things you have to take into consideration when you're working with females of any age, that there's probably a greater chance they're going to live longer and may have less saved up. So it reiterates the importance of having a good plan in place. Obviously, starting the sooner you can, the better. And I would say just in working with lots of families, more often than not, women will say, you know what, can you just tell me, am I going to be okay?

9:50Do I have enough for retirement? Do I have enough to send my kids to school? So really focusing on how the money can actually help them achieve those goals. I've seen that a lot more often coming from females, whereas males sometimes will say, how's my performance? I just want to maximize my portfolio performance. So I think certainly males and females both really need to take a holistic approach to financial planning, look at their goals and make sure that their money aligns with those. But at least anecdotally, I have found that women generally want to know how their plan is. Are they going to accomplish what they want to accomplish with their money?

10:27I noticed that in meetings as well, almost this ability to zoom out a little bigger picture, as opposed to getting lost in the details. And again, I think I can speak for us both when we're saying these are some broad stroke things that we're communicating. But one thing that you do a really nice job of in both the articles that you write and the social media posts that you put up is talking about the juggle for women with career ambitions, as well as raising a family, raising children, you yourself have three children, You're a shareholder here at PlanCorp. I think you're objectively a successful woman.

11:03How do you feel like you were able to maintain that? And what is some of the advice that you give to other women who are trying to balance this career success with raising children and having a family? I wish I had all the answers. That's like what so many of us are striving for day to day. But yes, I have managed to find a way to balance the two. So for me, my career was very important to me. So I knew even when having a family that I wanted to continue with working. So if that's something that's important to you, I highly encourage people to at least keep their foot in the door. Maybe not work full time.

11:37If they can work part time, that's fine and great. It can allow you to continue putting money into retirement plans and get some company benefits. It also helps you keep your skills up. So for me especially, it was really important that I continue working. Now, on the flip side, as a full time working mom, I also have to deal with the mom guilt that comes with that. I know you're a father as well. I don't know. I swear mom guilt is more prevalent than dad guilt, but you can correct me if I'm wrong. I think it probably is. I feel bad that I'm saying that, but I just, from watching my own working spouse, the mom guilt seems really difficult to deal with.

12:12Yeah, it is. Just the other day, my two-year-old said, you know, it's funny. Every time I come get her out of bed and I'm dressed nicely, she's like, oh, you have to go to work. I'm like, I guess I just dress like a slob when I don't have to work. But anyway, I was like, yes, mommy has to go to work. And so I'm really cognizant about not complaining about work, saying like, I do wish I could stay home with you, but got to work. But a mommy gets to go help people. So not making it look negative that I have to work, but also talking about what working does and how it allows our family to get more things.

12:39And the other thing, too, is for me, I feel like by working, it fulfills me so much that I think they're getting a better version of me when I come home versus if I stayed home all day. And I do things that allow me to spend really dedicated time with them. So for example, my husband and I have a system where I go in early. I try to get to the office pretty early, but then I try to leave by four o 'clock. So I have an hour, hour and a half every afternoon of undivided attention to the kids before the dinner, bath, bed chaos ensues. And during that hour, hour and a half, I'm very conscientious about not being on my phone and just letting work go.

13:18And so when I do spend quality time with the kids, it's quality time. And so that's something that's been really important to me. I also, my oldest is in kindergarten. So yeah, real school now and different activities that parents can come to, I block on my calendar and I make sure that I'm there so that he doesn't feel like he's getting the short end of the stick by having a working parent. So there are definitely ways to set aside time to prioritize. But I will just say there are moments I feel like an awesome mom and a terrible employee. And then there's the flip side that exists, too. So there's no perfect balance and it varies day by day.

13:55But thankfully, I have a job I really love and it has flexibility that I can do these different things with my kids still. One other thing I've started doing with the kids is doing mom dates. So spending one day or half day with each kid individually throughout the year, that's always something they look forward to. as well. So, and I've found that having the kids one-on-one is a lot less stressful than all three of them at the same time. You have three and I have two. So I'm impressed by everybody who has more than two children. It looks like an exponential difference in work, but it also, I can tell that the mindset looks a lot different.

14:34And I think also you're sharing advice that the struggle is common, that there is nobody who has it all put together is sort of what it sounds like. And I know how early you get here because there's two people who tend to get to the office before me. And Sarah's one of them. And on the very rare occasions that I beat Sarah to the office, I make little doodles on the coffee pot. The doodles are getting a little better, but they're pretty terrible dinosaurs and rocket ships. And so it's always a joy when I can beat Sarah to the office on the extremely rare occasion. I also, quite the tangent there, but I also like how you talk about time blocking for your children, something that I do too.

15:10are there ways that you feel like women could do a better job? And I shouldn't exclude dads, but I know that you write about this where women can better negotiate for benefits or changes at work that sort of support this balance that you talk about. Yes, I'm very much in favor of it never hurts to ask. So if there's something that would work well for you for your schedule, for example, you know, kids are off school over the summer, what I have come to find out now that my oldest is in school. Schools were not created for working parents. So the fact that they are off for two and a half months over the summer is a real challenge.

15:44So for example, if taking off Fridays during the summer would really help you feel like you're more present at home, ask. It doesn't hurt to try to figure out a schedule. Now I will say for anyone who wants to do that, come to leadership with a plan. Say, here's what I'm requesting and here's how I'm going to make that work. So not just going in saying, hey, I want to do this with no plan in place. So to me, it never hurts to ask. Think about what would really help you feel like you could maintain that balance of working and being a present mom. And I will say, too, I have help. And that's another thing, too, is delegate.

16:20So it took me a long time to finally delegate cleaning my house. I was like, I can do it. I'm fully capable of doing it. I hate to spend the money. I am so glad I did it. So instead of spending weekends cleaning my toilets, we are going out as a family and hiking and doing the things that we enjoy as opposed to spending every weekend cleaning because we both work. My husband and I both work full time. And we also have a nanny who helps with the kids during the week and she'll do the kids laundry and unload our dishwasher. So highly encourage dual working families to delegate. And that's one thing from a financial perspective we have decided to prioritize.

16:58So, yep, maybe it means we don't save as much towards XYZ, but for right now, that's really important to us. Well, that's a good lead weight into what we specialize is when people delegate their financial lives to us. So maybe you can share some of the ways that you see successful women planning for their long-term financial independence with you and as well as those who maybe aren't using an advisor yet, but try to do it themselves. Yeah, absolutely. So first and foremost, I'm a big believer that money can't buy happiness, but it can help you do all the things you want to do. So until you've really taken some time to figure out what is valuable to you and what your goals are, you're trying to just throw darts.

17:41I just think the first step really is doing a values exercise, figuring out what it is you value most, and then aligning those goals with your financial goals. And so for some people, it's creating a vision board where they actually can see it. So when you are faced with spending now versus saving towards a goal, look at your vision board. Look at that picture of the beach house you are hoping to buy in a few years. It will help you forego now for later. So step one really would be doing that values and goals assessment. Number two, review your inflows and outflows. Make sure that your cash flow is aligning with those goals and values.

18:19If you don't have excess cash flow to work with, then you should probably look over the last three to six months of your bank statements, your credit card statements, and figure out what expenses do you have that are not aligned with your goals so you can potentially cut. So that would really be step one. But if you're fortunate enough to have that excess cash flow that we talked about earlier, really the way to do that is to prioritize what are your goals that you're aiming for and then making sure that you align your extra savings towards those. I know something you've talked about a lot is reverse budgeting.

18:49And that's something that I think it's much more palatable than true budgeting. So the concept is really let's focus your savings. Like as long as you're hitting your savings goals and they're where they need to be for your long term goals, then whatever's left, you can spend however you want to. You don't need to be looking at the nitty gritty details of how much is going towards eating out versus transportation, whatever. It doesn't matter as long as you're hitting those savings goals. So I think figuring out what those goals are, then making sure your cash aligns to those goals is pretty intuitive.

19:21But you wouldn't believe the number of people that come in like, I don't know, I'm just kind of saving just to save. And so helping them really get clearer on what those should be is really important. Just like the example of the client who decided they really wanted to pay off their house. That was something really important to them. You can't just go by rules of thumb, which would have suggested that's not a good idea. So thirdly would be investing. So investing and staying disciplined, I mean, there's a lot of research that shows women tend to be less risky. I've also seen research that contradicts that.

19:53So bottom line is, though, if you've got goals that you're planning for that are, let's just say, 10 years or more out, you should have the vast majority of that invested for the long run. And I know you talk lots about having just a very low cost, well-diversified plan. It does not need to be anything complicated. I think that's another obstacle, especially women faces like, man, it's so overwhelming. I have no idea. It doesn't need to be complicated. Something very simple and just sticking with that plan. I've seen it so many times. That is the key to success is letting it go. But it's hard, especially right now in this day and age where there's social media shows are telling you what to buy.

20:30Oh, no, we're going to have a stock market crash. It's hard to filter that out, put on the blinders and just focus on your plan. I know you talk a lot about that, too. So like NVIDIA, it's hard to not think about, gosh, if I would have put all my money in NVIDIA, look where it would be today and I could probably retire. You can get caught in that all day long. So, again, just focusing on what you can control and that your plan is in place and just going back to that over and over during those moments is really important. And I'd also say preparing for worst case scenario, like especially as a breadwinner, you need to have life insurance.

21:05You need to potentially have disability insurance. I mean, those are just things, especially when you're the one with a family, depending on you, that you need to make sure you have and making sure you have estate documents in place and that you're reevaluating those on a regular basis. So those are all things that I'm doing with clients very regularly. That is wonderful information. I'm kind of curious if I can get really specific and tactical here with retirement planning advice. Is there anything that you would specifically tell women who are leading their households financial strategy? And maybe even how does that advice differ depending where they are in their career or life cycle or if it does at all?

21:43So obviously, again, for anyone just saving earlier, the better. But particularly for women with facing those headwinds I mentioned earlier, I would say if you can max out your retirement plans, that's a really good step. A lot of companies now are offering the mega backdoor Roth contributions. That's another potential planning opportunity, especially if your goal is to hopefully leave more to heirs. I mean, passing along a Roth account is much more advantageous than retirement assets. And then certainly as you get closer and closer to retirement, again, this is for males and females, but really thinking about what that's going to look like, what retirement is going to look like, how you want to spend your days.

22:27For a lot of people, that can be a big life adjustment. And so I think just really honing in on what you want that to look like, how you want to think about leaving wealth, I'd say that's another big differentiator between some of my male clients and my female clients. I've had a couple in the last few years where the male has passed away and the female has decided to be more aggressive in terms of charitable giving and giving to the kids. So those are strategies I've seen that are often more likely with females. So coming up with a good strategy where they can balance not feeling like they're ever going to run out of money or making sure that they're cared for, but also balance that with passing along the wealth to the next generations and doing it while they're alive.

23:12And they can see the fruits of that has been really something that I've worked with a lot of women on in particular. That's such a great point, Sarah. And I think one of the things I've noticed when we're working in client meetings together is your tendency to highlight these things as well as just some of those issues that aren't highly quantifiable. And this is true for men and women alike. Could you talk a little bit about how you incorporate mental wellness into the financial planning process as well and take that more holistic planning approach? Yes. So I am fascinated by behavioral finance.

23:49I think it's a really interesting area. And I also think it's going to be an area that all of us as financial advisors will need to get better at, because so much of what we can do is going to be digitized or taken over by AI. So a similar mentality in terms of when you're on the airplane, they say you put your own mask on before you put someone else's on. You have to be taking care of yourself before you can start to take care of other people. So doing things for yourself, making sure you've got a financial plan in place for your own retirement before you're worrying about paying for a kid's education is an example of taking care of yourself first, but really more on the mental health side of things, like making sure that you're doing the things that you need to do to keep yourself happy and at peace, whether it's getting massages regularly or whatever it is you need to incorporate right now for your own mental wellness that may cost something, but in the long run, it might be worth it.

24:42So just making sure that you're thinking about that. And I think from an advisor perspective, I think we need to be even more empathetic, really understand what drives people to make financial decisions. There's just so much that can clout our decision making when we're in stress, financial stress, or just worry. And so for us as advisors, just being able to work through that and know when someone's capable of making decisions and when someone maybe needs some time to do that is something that I'm really focused on a lot. I agree with you that I think this is where the future is. A topic that I've spoken about with other guests in the past or even just myself is that a real financial advisor had Carl Richards back on, I think it was episode 100, emphasizing the real part of real financial advisor will do these things for you.