How I Got Financially Confident by Starting a Money Club

Libby Kane
Posted

Kate (right) and Tara (left) started their own money club.

Do you ever talk about money with your friends?

Kate and Tara sure didn’t. At least, not until they became close.

Both of them were married, childless and living in Colorado, wondering where they were supposed to get answers to the tricky money questions:

  • How do you roll over a 401(k)?
  • Where should you allocate your money when you no longer have debt?
  • How much do you need to save to adopt a child (an issue near Kate’s heart)?

They got into the habit of grabbing coffee and swapping articles, books and advice about their own money struggles, when they came across a contest held by TIAA-CREF, a big financial services company, looking for the next great idea to get Americans to save more.

“We were really inspired by the idea of a money club,” they say, “where women could speak with other women going through similar financial experiences and empower each other.”

Kate had just gotten married and was wondering about her next steps: After ten years of working in public relations, would she continue on that path, start her own business or work as a consultant? Tara and her husband had just paid off all of their debt (outside of their mortgage) and were wondering: What next?

The two of them worked in similar industries and considered themselves just acquaintances for many years until meeting at an event in 2009. “All of a sudden, the universe put us in front of each other at a networking event, like we were meant to be together to solve problems and inspire,” Tara says. “We joke that it was friendship through fate and finances.”

Even before their money club was named a finalist in the contest, they got started.

How the Club Works

Tara and Kate submitted the idea to the contest in fall of 2010, but didn’t wait to hear back: Over the next two months, they reached out to friends and acquaintances who had talked about money with them in the past. “By the time our idea for a club beat 999 other ideas to win the people’s choice award in the contest, a group of about eight women were meeting on the first Tuesday of every month, alternating houses each time,” Kate shares.

Here’s how it works:

They Choose Topics: ”When we first started, we identified topics for discussion at each meeting,” says Kate. “Now, we invite experts whenever we can. This month, a mortgage broker is speaking, and recently, we heard from a retirement expert.” The women invite experts who have worked with friends and colleagues, so they know they’re bringing in someone great. (Have questions of your own? Here are ten things LearnVest readers are embarrassed to ask about banking.)

They Don’t Judge: “One girl is a foodie and loves to eat out. Another loves shopping—we all value different things and choose how we spend our money,” Tara says. “We also don’t mention specific dollar amounts. We talk in percentages of our budgets and salaries, so we don’t know what each other earns or owes. In our club, we applaud progress rather than numbers.”

They Have Fun: ”We have a rule that no one buys any snacks; whatever food you bring, you put together from your pantry or fridge,” Kate explains. “One time, we had apple pie because a member’s neighbor had gone apple-picking and gave her apples for free!” Each month they also have an exchange item, where they bring unwanted gifts like beauty products, books or magazines so everyone goes home with something new.

They Stay Involved: “One woman bought a desk and used it as an impetus to get organized. Another’s goal was to buy a car, and when she bought it, we all walked outside and saw her goal come to life. It was pretty cool to see it,” Tara says. (Here’s more from LearnVest on getting organized.)

They Issue Challenges: In the past, challenges have included not spending for a week, reviewing their 401(k) investments and prospectuses, increasing those retirement contributions, selling things they don’t want anymore for extra cash and forgoing all restaurants for a month (which both women agree may have been the hardest!).

The Best Part of Having a Money Club Is …

“We call it a savings club, but it’s not saving money—it’s saving our sanity,” they explain. “We don’t let each other get overwhelmed by money issues.” Their group includes ten women, including lawyers, biologists, teachers, parents and non-parents. “The diversity of perspective shapes discussions,” they say. “As much as money is really hard to talk about, it’s also really fun.”

And the club has created change in their daily lives: Tara always felt underlying money anxiety from a childhood of “we can’t afford that,” (and she’s not the only one). She had a defining moment when her husband wanted to buy a dirt bike. Instead of her usual reprise, “We can’t afford that!”, the two of them researched the bike together, which, lo and behold, led to a discussion about life insurance, something the couple had never discussed before.

Tara and Kate agree that having honest conversations is really the greatest thing about the last two years. As Kate says, “It takes a lot of worry away knowing that there are people to be your cheerleaders.”

“Our advice to women who would like to create a similar group is to look at your network and figure out who you connect with, who you can nudge–and who can nudge you,” they say. “You don’t have to meet monthly. Just start doing whatever works … two of you meeting once a quarter is enough. Once we know we’re here to support each other, we can all start making changes.”

Want to know more about Kate and Tara’s money club? Check out their website here.

  • Engchik

    very cool!

  • Amber

    Awesome idea! I would love to be part of something like this. Thank you so much for sharing. I really like the challenges and how you swapped items too. Sounds like fun!

  • Emily

    this is such an awesome idea!!!

  • Lauren

    Great inspiration!

  • elex

    love this idea!!!!