Connie Montana, 49, already had a passion for managing money when she heard the founders of the Women’s Institute for Financial Education (WIFE) speak at a financial literacy group meeting.
But when she learned that the average woman is widowed by 67 and spends an average of 15 years on her own, Montana, who'd been working as a corporate social responsibility project manager at Bank of America, realized that she wasn't as financially prepared for the future as she thought ... and neither were her friends.
So she formed a money club with three of those very pals in November 2010—a group that she christened "The Budget Babes."
How the Club Works
During each month’s 90-minute meeting (usually held over a potluck dinner), members share financial attitudes, goals and successes. To facilitate discussion, they use "zones," or predefined topics ranging from budgeting to providing for parents. “We primarily use the zones, but in an ad-hoc manner,” Connie explains. “For example, we'll switch up the order or add a different topic that matches member needs or interests.”
In other words, there's plenty of room for customization. For a recent meeting that focused on the retirement planning zone, each member chose circumstance-specific homework to share at the next powwow—like attending a webinar on a new company retirement offering, researching 401(k)s and contacting benefits coordinators to verify current account balances.
The Budget Babes also look forward to a "field trip" each year. This year, it's a bread-making session at Budget Babe Rosemary Bauer’s home. “She is the queen of budget gourmet at home!” says Connie.
We wanted the inside scoop on the inner workings of this unique money klatch, so they sat down with us to share how their club helped them team up to squash debt and trim spending in the midst of an economic downturn.
Why did you start the Budget Babes?
Connie: I wanted to keep the group small, so that everyone has time to talk. Rosemary’s husband had recently lost his job. Kathy King is a horsewoman, and Anecia Delduco has her own stable, and they run a dressage training facility together. As a former rider myself, I knew this typically meant that things like life insurance, health benefits and retirement aren't considered at length. A money club that offered information and accountability would help them reach their business goal of erecting an indoor riding ring, as well as their personal goals for the future.
What was your initial reaction to joining a money club?
Kathy: I was excited because, as a single woman embarking on a new career—from middle school teacher to the co-owner of an equestrian facility—I wanted to educate myself on all things financial. Since the Budget Babes was an intimate group of friends, it was far more inviting than, say, a class.
Rosemary: I was absolutely in! I worked part-time for four years while I went back to school at age 45 for my RN. I graduated just in time for the economic crash, and I was unable to secure a full-time position with benefits until July 2012. So one of my earliest money club goals was to land a second job. By the next meeting, I had three part-time jobs.
My Budget Babes are my cheerleaders. They give validation and encouragement—and I hope I do the same.
How does the money club help you?
Kathy: Where to start! I have no one at home with whom I can discuss financial concerns, so the group provides me with that audience. I can say things to them—out loud—that I definitely would be embarrassed to say to my financial planner, like asking for the umpteenth time what the difference is between a mutual fund and a money market. The Budget Babes hold me accountable for my goals. In fact, that's a big one—I find that I don't like going to a meeting if I haven't done my "homework."
Anecia: You get a social aspect out of it with people who you respect as peers, so you feel comfortable running things by each other. Plus, we all come from totally different perspectives, so we look at each situation differently. For instance, Connie has an incredible banking and investment background, so she can suggest specific loans for businesses, and how much money to have in reserve. Rosemary, meanwhile, is smart about the daily life situation—she can save a buck anywhere!
Connie: The group talks me off the ledge when I want to make a big purchase—it’s harder to rationalize things to a group, as opposed to just yourself. I recently really wanted to buy a Honda Crosstour. I could taste it! I posted the pictures on Facebook after test-driving it, and Rosemary commented, "Yes, it's beautiful, but is it in the budget, babe?" She saved me from an impulse purchase.
Rosemary: My Budget Babes are like my own personal cheerleaders. They give validation and encouragement—and I hope I do the same for them. My goals and strategies aren't always as black and white as they might be for my friends, but it works for me. For example, I shared a new list of unexpected expenditures at one meeting, but I quickly followed it up with "but I haven't touched our savings. That's huge! Right?" They were impressed.
Who would benefit most from joining a money club?
Kathy: I think everyone could benefit from a group like this. Of course, it's easy to have fun and get off track sometimes, but Connie is an expert at keeping us on topic.
Rosemary: It's similar to a 12-Step Program. First, you have to want it. Second, you have to live by the number one rule: What is shared in the meeting stays in the meeting. Not everyone understands the importance of that simple rule, but without safety and respect, a group like this can't work.
The biggest change for me? I feel so in charge!
How has being a Budget Babe changed your life?
Connie: I’ve increased my emergency fund, and upped my 401(k) contribution 3%. On a more day-to-day scale, Rosemary once noted how my family was eating out "again." After her comment, my family committed to an entire month of not eating out—and saved $300! As for Rosemary, she found a second job and additional income when her family needed it most. And when Budget Babes started, Anecia and Kathy didn’t have a business plan or know how much it would cost—they’ve since erected a riding ring, and the business has taken off!
Anecia: At one meeting, Connie explained the concept of a reserve fund in which you have three months' worth of savings for a house or a business. It allowed me to take more chances—like opening the indoor ring—because I knew that I could fix most financial issues in three months, and I had the savings to do so. The ring has allowed us to work year round, which has been huge for our business, as well as our own personal achievements in learning to be better riders. We've tripled our business at this point.
Kathy: The club coached me on developing a budget, so that I can track what I spend. It's helped me to take control of my finances—and do so with confidence. Another helpful pointer was to build an emergency fund, which has come in handy when dealing with malfunctioning furnaces and central air units!
Rosemary: The biggest change for me since joining the club? I feel so in charge!
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