Photo credit: iStockphoto.com (PCH-Vector)
Brittney Castro, a Certified Financial Planner who has worked alongside brands ranging from Chase to ETrade to Zoom, started working in the field at 22 – just when everyone was experiencing the Great Recession. She observed, in her words, “everyone freaking out” and wondered why. Logically, she understands that downward cycles happen every four or five years.
She also realized that getting anxious, fearful, or in other ways emotional about it didn’t help. Moreover, she recognized that the profession fueled fear in its clients. That experience, and being a dedicated meditation practitioner, helps her bring level-headedness to her personal finance work. As she says: “Life is hard. It can be really hard. But it helps not to have a mindset that worsens it.”
Q: People have many money worries right now. Let’s start with worries about layoffs. We’ve seen some big rounds of job cuts at tech giants. What do you recommend that women worried about more potential cuts – in tech or other industries – do to protect and potentially prepare themselves?
Get your ducks in a row. Update your resume. Update LinkedIn. Be smart. If you think there is a risk that you may be laid off: What are you doing now to get things going so that if you need a job search, some things are already done? Maybe have conversations with people in your network. Perhaps explore other opportunities. Look at your finances now. Where will your money come from if you possibly won’t have an income for a few months?
We’re all considering what costs we can eliminate in our budgets to save on expenses now. And I think you just roll with it. You can’t control some of it. If that is the case, try not to feel too emotional. Just think: ‘Now, what can I do?’
We all have to think like entrepreneurs and business owners, even if we’re not. We need to have multiple income streams. That’s a reality of life. Putting all your eggs in one basket will make you feel downturns extra hard. Think, ‘Could I be a consultant? What other skills or side hustles can I have so income is not on one source?’
Q: The collapse of Silicon Valley Bank also alarmed many people. Is there a reason women should be concerned about the safety of their money today?
Yes, we need to be aware. As we saw with SVB, the government will likely back up any bank. But we don’t know for sure. But even if it does happen, it could be that the money is not readily available to you.
You need to know the FDIC protection limit in my bank and how much I have. If you have more than the limit, you need to take action. It could be you need extra layers of diversification to be protected.
For the majority of Americans, this won’t be an issue. But having more than $250,000 or $500,000 in a savings account could be an issue.
Q: The threat of a recession has also been hanging over our heads for quite a while – even though the Fed has been doing a lot to prevent that. And a recent article found that women feel less prepared to weather a recession than men. What do you recommend women do in times of financial uncertainty like these?
At times like this, I always say to put it in perspective. A lot of people won’t be affected. So don’t take on extra emotional baggage. A lot of businesses are booming. I may not feel the effect other than inflation. With all the recession and inflation talk, it’s panic, panic, panic, and most of the time it doesn’t affect people’s day-to-day financial situation.
Recessions just mean you need to cut back spending and find ways to diversify your income. Maybe your stock portfolio will decrease over the short term but not the long term. Also, with recession comes opportunity. Perhaps there is a new business you can start. Or house prices go down when you’re in the market for one.
We always need to filter the news down to our situation. And take a pause. Just because you hear something is happening doesn’t mean it will happen to you. Take a beat.
The financial industry promotes panic and fear because it keeps you out of the game. It keeps people from seeing how they could create wealth or opportunity. Then we lose our intuitive insights and wisdom. I think this is especially true for women. We know what feels good. We know when we need to ask more questions. We need to think for ourselves. ‘Does this even apply to me?’ And take responsibility. I think many people don’t want to take responsibility for their finances.
Q: When it comes to money, many women have some knowledge of what they “should do” but have difficulty putting that into practice. What would be the top three things you would encourage women to do this week to improve their finances?
Celebrate small wins. Maybe you feel like you should have saved and you didn’t, or you should have a home, and you don’t. But that’s a losing battle.
There are simple things you can do. Look at your spending for the past month. Get real about where the money is going. And then feel good about that. Make a weekly money date when you handle things in your financial life. There’s always something you can do.
Q: Many people in our community have expressed an interest in advice for retirement planning. I know this is a big topic. But what do you recommend some of the most important things women who haven’t yet tackled retirement planning do?
It’s overwhelming to think of the money you need to save for retirement. ‘Oh, I need $2 million. That’s impossible.’ I know that never did anything for me. The best thing you can do is save little by little. If you have a job and 401K, pay the total to get the match. Increase it by 1 percent the following year until you reach the max.
If you’re self-employed, open a retirement account. Save every month – even if it’s $50. Then work to improve it every year. Maybe run some projections. It’s a long-term game, and you have to start somewhere. If you haven’t started, don’t punish yourself. Just start.
Q: A 2023 survey showed that 50 percent of women are fearful or avoidant regarding their finances. Why do you think this is – and what have you found are the most effective strategies for helping women overcome those feelings?
Women couldn’t manage their money at one point in history. In the grand scheme of things, it hasn’t been that long. In the 50s, women couldn’t get a loan without a man. I would say find someone who can teach you about money in a class or a financial planner who speaks to you in an empowering way.
You don’t want someone implying you’re dumb because you’re asking questions – because there is much going on. And it’s hard for women. I never feel empowered when someone is talking to me like that. But if someone encourages me to learn and does not make me feel wrong, I will naturally seek more understanding.
Find people who educate and empower you. Trust your instincts and keep learning.
Brittney Castro spoke at the 2022 Massachusetts Conference for Women.