Kristin: I hate talking about money. I've always hated talking about money. It makes me very uncomfortable.
Jamie: Meet Kristin. She's a real estate agent in her late forties. She's married with two teenage daughters and yeah, money.
Kristin: It just stresses me out. I just feel like, um, I'm a planner, I'm a type A person. I'm sort of an all or nothing mentality and just, it's a huge part of our lives and it's, it's one of our stressors, how to plan for the next generation and provide financial stability for them, and it's on my mind a lot. So it, you know, planning it out even more just gets me feeling anxious.
Jamie: Kristin wants to set up a solid financial foundation for her daughters like she had.
Kristin: I look back at my life and what my parents were able to provide for me and what my husband's family provided for him. And we both realized we're incredibly lucky and that not everybody's parents are able to do that. I graduated college debt free and that was an amazing gift that I didn't appreciate until I had my first job and I was saving my first paychecks. And I want that for my children. My dad always referred to it as a downfield block and he's not alive anymore, but he would always talk about, if I can give you a downfield block, I'm going to, and I wanna do that for my kids. So whether that's a wedding or a little down payment on a house in the future, any downfield block we can give them, I wanna be able to do.
Jamie: And as committed as Kristin is to her family, she's been just as dedicated to her career and has achieved a lot of success. But like many women her age, Kristin feels like everything has just gotten more extra lately, especially after she started experiencing perimenopause.
Kristin: I just feel like a whackado half the time. And thank God I have friends that are willing to talk about it. And we do talk about perimenopause or what stage of menopause, and it got to the point where I was like, this. Something chemical that's going on in me. And does that lead to my anxiety about whether it's finance or life or children or whatever it is? And it all ties in together. It really does, like the pressure of work and how many more years do I need to make? You know, do I need to exceed at this level versus, Hey, how would my life feel if I was kind of here? I'm still gonna be productive, I'm still gonna be successful, but I don't have to give up every aspect of my personal life for my career. And what if I tried to be a six or a seven instead of always operating at a nine and a half?
Jamie: Through all of this, Kristin knew she and her husband needed someone who really understands them to help manage their finances. They had been going to an advisor that her parents had used for years, but she never felt a strong personal connection. Then she met Sarah at a lady's Christmas party. They clicked and became fast friends. Sarah is also a financial advisor.
Kristin: And because we were good friends at first I felt a little bit awkward about that. You know, I said to my husband, does that feel funny to you if we're kind of letting Sarah in on our whole life financially? And she's such an easy to get to know person and very much an open book. And I'm the same way. And we just clicked always when we made the switch to Sarah, I just felt like I was finally part of the conversation. And it wasn't me looking in on my financial advisor and my husband making decisions, but I actually felt comfortable. From the get go was like, this is gonna be good. I'm not gonna hate every time we have to meet our financial planner.
Jamie: Kristin and Sarah have been working together for a few years now. Sarah has created a financial plan for Kristin's family, and her situation looks good. But Kristin's anxiety persists.
Kristin: How much longer am I working? How much do I have to make? How much do we have to save? Do we have enough saved for, for college and for our kids' wedding, for our kids' future children, and, and all the things we wanna be able to help them in the future. So just at this stage of our life, the, the financial goals become financial realities and things that we wanna make sure we've really saved for and planned for.
Jamie: And that's where we'll start today. I'm Jamie Roo and welcome to What Should I Do With My Money? An original podcast from Morgan Stanley. We match real people asking real questions about their money with experienced financial advisors. Here at Morgan Stanley, we work with a range of clients. Some are experienced investors, others are new to working with a financial advisor. On this show, you get a front row seat to hear what these initial conversations are like and get answers to some of the questions you might have yourself.
Kristin has already been working with Sarah for a few years. Sarah is a financial advisor and family wealth director at Morgan Stanley. Her focus and passion is helping women with their finances.
Sarah: It's an underserved market, and I'm not exactly sure why that is. As 51% of the population, the difference between women and men as it relates to finances tends to be a crisis of confidence. And so just breaking down that barrier and making people understand that they don't need to feel bad for wherever they're at, let's figure out where you are today and then, okay, what do I need to do to move forward?
Jamie: And it was actually Sarah who contacted me with the idea of having Kristin on the podcast. Sarah says she's been seeing a lot of her female clients reach their late forties and early fifties and find themselves in a similar mindset to Kristin.
Sarah: So yesterday I had a conversation with a client who's right around our age and. she's like, And I'm not feeling so great. I'm sort of stressed out. I don't know why I'm so stressed out. I wanna slow down and work. You know, what does that look like? And so you kind of have these conversations over and over again where people are trying to get their values and how they feel to align with their goals and their portfolio and their strategy. And they're really sometimes coming and saying, Hey, how soon can I get out? How soon can I retire? What does that look like? I'm kind of frustrated. I'm kind of done.
Jamie: Just to be clear, Kristin isn't frustrated with her job. Quite the opposite. She loves being a real estate agent, but she does feel a growing level of stress and anxiety, and Sarah in her purview sees a connection in a lot of her clients between these frustrated feelings and hitting perimenopause.
Sarah: If you don't feel great physically, and this could be anything, you hurt your back, whatever. If you don't feel great physically, it makes you question life decisions. It just does. Am I gonna have a hot flash in the middle of a presentation for 200 people? Like these are real things that I don't think people realize people are thinking about, and it's super stressful.
Jamie: As we often say on this podcast, money is emotional. Understanding that, understanding how finances and psychology connect is a fundamental skill of being a good financial advisor.
Sarah: Part of our job, or at least what I spend time on is, trying to help somebody think of the art of the possible. So we're sort of all programmed. I work with a lot of, you know, type A people and so how to make them feel a little bit better and, and think about things a little bit differently just based on the fact that I may have talked to somebody else or I know, I know mathematically, emotionally, I've done this before through experience. I know your financial plan is okay, and if you need to spend X, Y, and Z on healthcare, personal trainers, coaches. Then go do it. And maybe you didn't think of that.
Jamie: Well, Kristin and Sarah, obviously I don't need to introduce you. I'm just going to step aside and let you get to it.
Sarah: Thank you so much for this. I'm so excited to talk
Kristin: I'm so excited. Me too. Me too. So fun.
Sarah: So, I know we get a chance to talk all the time, but why don't we talk about some things that may be on your mind. As it relates, you talked a little bit about kids and values and family and retirement, so where shall we start?
Kristin: Yeah, and that's, I feel like that's on my mind all the time. Like I feel like I'm, I, all I think about is wanting to be a better mom and a better wife. And what does that mean, or what does that look like? Have we, you know, have we done enough for the kids? Have we saved enough for the kids? What does our future look like? that's all I think about is wanting to do for my kids, and that a huge part of that's financially.
Sarah: Yeah, it is things cost money, right? And so one of the things that's so critical about a financial plan is thinking through what are the goals and do we have things put together to be able to align with those goals? And I think that saving for college gets to a lot of other areas where if, if we were the type of people that we're like, we have to be doing something, we feel like if we're not actively feeling like we're doing something, it's not getting done. And one of the beautiful things about your plan or people's financial plans in general when we work with them is, okay, what are the little, little things we have to do so that we wake up when someone's 18 years old and it's done.
Kristin: I was gonna say, that's the part that I realized even after our last conversation and it was like, okay, the big things are saved for, I, I still feel weird. I walk away from that conversation. I worry about the day to day. I worry about the, like, am I splurging too much on this? Do we have the money to do this? Is it a good habit to do this?
Sarah: So one of the things that I think it's important for parents to do is to talk a little bit openly, not necessarily about the actual dollar amounts, but. You know, that casual mention of did we put money aside for the savings this month? Did we, did we allocate that the right way? When was the last time we looked at our, I'll just say asset allocation, maybe you would never say that at the dinner table, but that little casual like tidbit, um, gets absorbed.
Kristin: That whole thing sounds awful to me. Like even hearing you say that, I'm like, I don't wanna do that. I don't wanna honest if I'm being honest, like I really, I, I hate that. I hate even talking about that or trying to put it in a little box, entire ribbon on it. I, I get flustered with that. I wish my dad was alive and I, and I should ask my mom to say, how did we know that? Like how did we know that you worked hard and we appreciated it? And money, I mean, my dad used to say, money doesn't grow on trees all the time. So I remember hearing those little phrases, but I think the values that your kids have towards money is something you either teach them or don't teach them.
And I, I can't remember how I was taught, but I do feel confident that I grew up with really good values, knowing that I had to earn it to, to have it, to spend it. And I, I worry that I'm not passing the right values onto my kids to set them up for future success.
Sarah: I think the one thing that we all forget is that as we go through life, we're all leading by example. So you may not think that your everyday decisions are contributing to the values that you're hoping to instill with your kids. But time and time again in the conversations I have with clients, they're always shocked by the fact that 10 years later when their kids are in their twenties, they, you know, wax poetic about how their mom instilled these values in them and they didn't even realize they were doing it.
So, if I think about your experience, you work really hard, you save your money, you're careful with your money, you make thoughtful decisions. You care a lot about the people around you. I'm guessing those values are translating to your kids without even realizing it. If you wanted to add something to that, you could think a little bit about creating the mindfulness and the awareness around it.
Maybe a tiny bit of transparency here and there about your thought process that went into it, but you're probably doing a way better job than you even realize, and I bet if you thought back to how did your parents instill their values in you, you're. Probably not realizing and they may not even realize.
You could probably ask your mom that question, you know, did she do it intentionally or did it just kind of happen Because look at you, so good with money. Here we are, and the values that you're hoping to instill in your kids, and you already have them.
Jamie: Something that Kristin brought up is how perimenopause might be affecting her levels of anxiety around finances, and it's something that Sarah finds herself talking about a lot with her clients.
Sarah: So I think health issues are interesting. They're a little bit like money issues and people don't always wanna talk about it and they don't have someone to talk to about it. And so when it comes to a conversation about. Personal finance, personal health, you're really divulging something very private with someone.
And so we have conversations that go deep on these topics and they can be things like, how do I dial back my workload? Am I in a place where I can. Either change careers if I'm not feeling good, um, you know, maybe I need a break. How do I, how do I look at that? How do I do the analysis around that? How much money can I spend on my personal health?
And some people need that permission to say, okay, here's a bucket of spending, or here's an allocation of my budget, or here's how it doesn't impact my financial plan to spend some money on myself to feel better.
And so really giving people permission to think that way I think can make a huge difference in their lives.
Jamie: What Sarah's talking about here is clearly not just about accounts or investment transactions. She's concerned with Kristin's entire wellbeing as a person. This is really important to us at Morgan Stanley. So important that we have a full-time doctor on staff. Dr. Kim Henderson is Morgan Stanley's Associate Medical Director.
Dr Kim: I lead our health and wellness education answering questions about longevity, helping people navigate devastating diagnoses, , providing education about, children with special needs. So anything under the sun.
Jamie: Now we haven't brought in other voices to weigh in on issues on the show, but Dr. Kim is really passionate about women's health and the intersection between physical and mental wellness and financial wellness, especially for women like Kristin. We really wanted you to hear from her.
Dr Kim: As women get closer to perimenopause and menopause, one of the first, signs or symptoms that many women develop is a sense of overwhelming concern or anxiety about things that will happen in the future. What's going to happen to me when I get older? What is going to happen to my children? What is going to happen to my family? So you have a woman who's not maybe sleeping as well she used to. She's got hot flashes. She's got brain fog. She might break out in a sweat while she's walking down the street. Like all of these things are very disconcerting. And then you sprinkle in a little bit of financial concern, then you have a perfect storm.
Jamie: So clearly Kristin is going through something that a lot of women experience.
Dr Kim: If you stay on this planet long enough as a female, you will go through menopause. Then the question becomes how do we set ourselves up for success?
Jamie: Dr. Kim knows exactly why Kristin wanted to bring this up with Sarah.
Dr Kim: There is no separation between physical health and wellness, mental health and wellness, and financial health and wellness, it is all in the same stew.
And the reason why menopause is so complex is that it's not just physical complaints or just mental complaints. It really is both at exactly the same time, so it's important to reiterate the importance of a plan. Yes, to understand what's coming, to make changes as they're necessary, and to revisit often. Women have to talk about this. You cannot fix anything that you can't talk about in medicine, in finances, in life. You need to be able to talk about it early and often to understand what's out there and really have an understanding that you're not alone in this.
Jamie: If you'd like to hear my entire interview with Dr. Kim Henderson, where we dive deeper into the connection between physical and financial health, you'll find it at morganstanley dot com slash my money. Now, given everything Kristin's experiencing, she wants to explore the possibility of taking her foot off the gas a little bit.
Kristin: The idea of retirement is not something I ever think I'm going to say. I am retiring from selling real estate. Like I think it ebbs and flows and luckily it's a career where you can do that. But the financial part of that, as you know, has always been very scary to me. Like, how do you know when enough is enough? How do you know how many more years do we need to keep working in order to achieve a level of financial stability that feels like it will carry me out until I'm 95 years old.
Sarah: Yeah, I mean the good news is there's math for that part. So the financial plan, like inside baseball, the financial plan is made up of how much do you wanna spend? We usually use today's dollars, we adjust it for inflation. And we say, okay, ballpark, based on what you know today, subject to change, whenever you wanna change it, what do you have to do to be able to get to that bogey?
Right? It's like a super basic math problem. And then we apply a rate of return that's pretty reasonable based on a basic, you know, reasonable quality asset allocation.
Kristin: I hate all these terms, I hate them. I just wanna know, is there enough money for me to continue living the life that we live along with a few nice perks along the way to the kids and maybe to ourselves. And if I have to go in 12,000 a month assisted living one day, how do I make sure my kids aren't paying that? Like all the financial terms make my head spin.
Sarah: I feel like the answer to your question is yes, and that's why you've hired a financial advisor.
Kristin: Yes. Yes.
Sarah: To make sure that all of that gets accounted for and what you're really good at and what you've done really well is articulated. Here are the things I'm worried about and the things I'm thinking about. Make sure it's in there. And then to your point on the long-term piece of it, you know, we're in that sandwich generation where we're in between, maybe we have kids, maybe we have parents, maybe we're thinking about the financial needs of both at the same time.
Kristin: I don't think we've ever talked about that as it pertains to our own health as to my own health with Ryan. And if I'm being super vulnerable, I'll say that that is on my mind. Like even when I go to my doctor now, and the, and this probably happens to you too, and the doctor's like, okay, what are we worried about? Uh, as you know, and you can relate, I lost my father, what was a young age for him to Alzheimer's and when I'm at the doctor now and she's like, what are you worried about with your health? That's a huge part of it for me. Like, how do I not get that? How do I not have Alzheimer's? And have my children have to take care of me?
Like, what if somebody needed that for 20 years? What if it's 70 years old? I'm diagnosed with Alzheimer's and I live to be 85, and I'm in a place that is 15 grand a month. Like that could happen, I pray to God not, but it could.
Sarah: It could, that would be a bit of a, a higher end risk. The typical dementia timeframe is about seven years. The non dementia, long-term care is about four. Um, nursing care is usually about a year and a half. So some of those, you know, there is a math problem for that again, and it's factored into your plan.
So one of the options that a lot of people think about as it relates to long-term care is long-term care insurance, which basically says, I wanna put aside a bucket of money so that if I have to end up in a home for X number of years, we usually plan for six.
Then there's a bucket of money set aside that's gonna help offset the cost with that. And interestingly enough. It's usually women in their fifties and early sixties who come to us and say, I wanna do this thing, or I heard about this thing, and it comes up either from their peers or they had a parent that they either had to pay for or the parent had the insurance. And how do I also get that?
Some people use insurance or sometimes we'll just set aside some money as it relates to their financial plan and investment strategy to make sure it's covered. Um, but yeah, there's a way to do a bucket of healthcare money.
Kristin: Interesting, ok.
Sarah: The long term care insurance is in place from day one. It grows over time. You either use it and it deducts from the value that you have there, which is usually a six year policy. If you don't ever need it, it goes as a death benefit to your heirs.
Kristin: So if, if, if you never end up needing it, if you end up dying, like in some sudden death and it becomes a benefit to your children, is, is it restricted as to what they can use that money for?
Sarah: No, it's tax free life insurance. So if you put a hundred grand in and making up numbers and it gives you $150,000 death benefit, then your kids would just get, if. If they were the beneficiaries, they would just get $150,000 in cash. Normally, for spouses, we'd have one, the spouse be each other's beneficiary. But you could always just have it going to the kids. As you're structuring your estate and you're thinking of your assets, that things go appropriately to your kids, and I'm guessing this is another one of your most favorite topics, but just know that when we're thinking through your assets and we're titling them, right, and maybe we talk to a trust and estate attorney, all of that planning is to make sure that God forbid something happens to you, your kids are taken care of in an appropriate way.
Kristin: In some weird way it doesn't make me uncomfortable to talk about that. 'cause that's like a, that doesn't make me uncomfortable at all actually. Like, and I think that is something that we should revisit. Like I feel like our wills right now are just straightforward. It goes from me to my spouse if we're not alive to our children.
But it probably should be way more structured in a way that it's not just, Hey, here's your lump sum of money at whatever age your parents are no longer on this earth. And that it's structured in a way that aligns with our values and morals towards how we want them to save that money and spend that money and use that money and still work hard to earn their own money and not just be, be given something potentially.
Sarah: So one of the things that we spend time on is thinking about, okay, what are the key questions that we want to make sure that all of those big legal documents with a fancy terminology reflect what we want. And so a couple areas of things to think about. So first of all, how do you want things to go from one spouse to another and make sure your kids are protected?
Um, I don't think a lot of parents don't think about it, but God forbid something happens to me and my husband gets all of the assets. And then what if he were to get remarried? How do I make sure that my kids are protected?
Kristin: Yeah, we do not want the young hot second wife getting everything I worked for. No.
Sarah: Or there are kids necessarily instead of your own, right? And so just structuring like agreements and so that you just sort of write the question in plain English and then you let the lawyer make sure the documents reflect that. The other thing you brought up is like how much money can kids get at what age?
A lot of times people will kind of spread it over time. And then where are the guardrails around that? Is there a guardian involved? Is there a corporate trustee involved, like a, like a company to help administer that?
Kristin: So if that's something that we wanna do, is that something that now we know it's on the radar, we add it to the to-do list, but do you have like some sort of a template? I, I wouldn't even know what questions to ask. Like some of the things you just said about making sure you do this or like, do you have a little template to kind of guide that conversation and help us get some sort of document in place that they would, that we would then give to our attorney and he would sort of, you know, type it up or whatever you
Sarah: Yeah, so normally we, we write, we write up a list of questions. I do have templates, the firm has some great resources around that for that conversation.
Jamie: If you'd like to take a look at a list of questions to bring to an estate planning attorney, follow the link in the show notes.
Sarah: But specific to my clients, I would say we would come up with a list of questions that I think are things that we wanna make sure that get addressed.
And then usually we would set up a call, a zoom, a meeting, whatever. And if you're comfortable, I would participate to make sure that the lawyer is speaking plain English instead of sometimes legal English. Um, because that, that can be one of the tricky parts. You know, they're gonna hand you back this 12 page document and you're like, what does this mean?
The other thing that we do to help with that is we will then synthesize, you know, our planning document that we use every time we get together, that like sort of plain English document. I will synthesize the legal documents in the back of that in a summary form with any questions that we have to make sure that we kind of like know where is everything? Did we cover this? What does that look like? And it's very easy to go back and add something, change it, whatever you need to do later on.
Kristin: Okay. We definitely need to do that. I think that would be very, very valuable to do sooner rather than later. Just 'cause it gives us more things to think about too. And again, that's, that's not weird to talk about or awkward to talk about. I like that.
Sarah: And I'll say one more thing on that, which is not necessarily applicable to this specific conversation, but as a PSA for anybody listening out there.
Morgan Stanley is a full service firm, so you get a lot of service with that. When parents are aging, when people are aging and they have self-service out there, there's a lot of things that they may not be thinking about that I think are really important to cover. And so part of what we're doing is just making sure all those boxes checked so that God forbid something happens.
From a healthcare or worse perspective, the level of effort for the kids and the family is mitigated by having everything in place.
Kristin: Yeah.
Sarah: Kristin, thank you so much for doing this. I am amazed at the fact that we've been meeting and we've known each other for years, and here we are with new things on our agenda for our next conversation. Uh, planning is like that, I guess. It's iterative, and as you get to different points in your life and you're feeling different ways about different things, we add to the agenda. We change the plan, we modify the plan, we make sure that aligns with your priorities. So I think this was such a good conversation and gives us so much fodder for our next official meeting, and I just can't thank you enough for taking the time to share.
Kristin: And I, I so appreciate that. Honestly, I think I've come a long way with you and I really owe that to you. I, I still don't love talking about it, but at least I feel like I'm a part of the conversations. I feel better about it. I cried last time you came over because you made me feel better about our future and how things look, and that's really important. So I, I really, I think the world of you and what you do, and we feel very fortunate to have you on our team and helping to plan our lives. God knows I love a plan, so thank you for being a big part of ours.
Sarah: Thanks.
Jamie: So, Kristin, this wasn't the first time you talked with Sarah, obviously. How was that for you this time? And was there anything new, surprising and different that you learned this time around?
Kristin: I think the biggest thing I learned, and I actually wrote it down we were talking, is just the fact that I, I don't need to have this guilt over spending money that I wanna spend on myself. Like that was a, like an aha moment when she said that. I work really hard and I work really hard to take care of everybody else in my life and making sure that they've got all the things they want. And that really clicked for me. I, I don't know why I had never thought that before, but I just hadn't.
Jamie: And how about some of the guidance she had around getting your accounts or even working with your parents to set things up for everybody's comfort?
Kristin: I love that idea of looping in our attorney and really kind of coming up with a plan of how things would be distributed and the fact that she said, you know, making sure that if it's not to your spouse, it's directly to your children. I, I really hadn't thought about that part of it. Again, for me, the values of it is all really important. So making sure it's structured in a way that, yes, there's a cushion for them, but it's not expected by them, and that they still have to work on their own and earn on their own and provide for themselves and learn all those important skills, but that maybe they don't even know about it. They'll be a little downfield block waiting for them if they need it.
Jamie: Amazing callback. Well, even if these aren't your favorite topics, Kristin, you clearly care deeply about getting the finances right for you and your family, and it sounds like you and Sarah have a plan to do just that. So I want to thank you for taking the time to do this today and sharing your story so openly with us.
Kristin: Thank you for having me too. I enjoyed getting to speak with you and get to know you as well.
Jamie: If you'd like a deeper dive on what was discussed today, or if you're interested in having a financial plan done for you, come see us at morganstanley dot com slash my money. I'm Jamie Roo. Talk to you soon.
DISCLAIMER: This material has been prepared for general reference and educational purposes only. It does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Please see our show notes for a full disclaimer on the information provided.
