Yes, yes, we know it’s an impossible question, but we bet you’ve asked it anyway. How much money is enough? How much do you need before you feel confident that you can… what, exactly? Stop worrying that you’re going to end up a bag lady? Take a break and try something different, like maybe a whole new career? Everyone has her own comfort level regarding money earned, money spent, and money in the bank. We asked six women to tell us what financial security means for them.
CARRIE SCHWAB POMERANTZ, 44
President, Schwab Foundation for Learning
"I have always saved, since I was about nine years old," says Schwab Pomerantz. "It wasn’t for my first car or stereo; it was always for the rainy day. My dad was a struggling businessman until my twenties."
Her father is financial services guru Charles Schwab, and as everyone knows, his company outlasted its early struggles. These days, Schwab Pomerantz follows her passion for helping disadvantaged women and girls through the Schwab Foundation for Learning. She is also an officer of her father’s firm, where she provides investment advice. Her formula: For every $1,000 of monthly income you want over a 30-year retirement, you’ll need $300,000 in investments. It’s a number many people find shocking. "I give people a reality check," says Schwab Pomerantz. "Most people have never been told how much retirement costs."
For her personally, "enough" has always meant the ability to make her own choices. At midlife, Schwab Pomerantz’s habit of saving for a rainy day has morphed into saving for retirement. But she’s also discovered she’s ready to have more fun—so for the first time, she’s hired a financial planner to help her stay on track and still have money to play. "I’ve been raising my kids and plugging along," she says. "Now I’m ready to get back out in the world."
The Bottom Line: Even finance pros hire financial planners. There’s no security like having a plan that works, and sticking to it.
SHARON ISBIN, 49
As one of the world’s leading classical guitarists, Isbin can pretty much write her own artistic ticket. Last year, this Grammy-winning artist recorded with the New York Philharmonic, the first guitarist ever to do so.
Isbin’s financial acumen lies in understanding more than just the artistic value of her work. "As a guitarist, I’m in the fortunate position of playing an instrument that’s not part of the orchestra," she says. "So, for example, if I’m the person for whom a new guitar concerto was written, orchestras have to ask me to play it."
Isbin also excels at taking care of business—contracts, recordings, bookings, promotions. Yes, she has a manager and an agent, but she still pays microscopic attention to details others might delegate, down to choosing the photographer of the record cover. "Everything has to work together," she explains.
Isbin supplements her performance and teaching income with other investments, including the purchase—and very profitable sale—of a New York City apartment. Asked to define "enough," she doesn’t hesitate: "I want to be confident about the future when I retire," she says. "I don’t want to be sitting on an airplane going on tour when I’m 85 years old!"
The Bottom Line: Know what your work is worth, and make the most of your high-earning years.
STEPHANIE ROSS, 56
Throughout her career, Ross, a senior producer on The Tonight Show with Jay Leno, has used the same organizational skills that make her successful at work to make smart financial choices. So she was confident that she and her TV-producer husband, Gregg, had all their ducks in a row for retirement before 60. But life intervened: Ross’s mother, now 88, outlived her long-term-care insurance plan. "I never took into consideration that I would probably need to support my mother," says Ross. The resulting drop in income is "just ruinous," both in terms of affording the assisted-living facility where her mother resides, and for her own retirement plans.
Ross says she’s still figuring out what’s next. For now, their retirement plans have been shelved and financial expectations downsized. "My mother gets her biggest thrill out of a 99-cent cinnamon roll, not a cashmere sweater anymore. These days, ‘enough’ means having money for healthcare, theater and books."
The Bottom Line: Healthcare crises are the financial-planning wild card. Invest in insurance that will last as long as you do.
Financial Testimonies, continued
VICKI ROBIN, 60
For Robin, who coauthored 1992’s Your Money or Your Life, a bible of the back-to-basics movement, money is the great distraction from our limited time on the planet. What inspired the book, she says, was "seeing how many people were suffering from the culture of ‘more is better,’ and there’s never enough."
When people figure out how much money they’re making, Robin says, they usually leave out the real expense: the time, trouble and stress of making it. "You trade your hours for money," she says. "When you buy a latte, that might be a half-hour of your life."
Robin also lived frugally, cutting her own hair and maintaining her car, even rebuilding her engine, calling that "very empowering."
She cheerfully concedes that now that she’s 60, her need for creature comforts "has probably doubled. I actually have a comfortable bed now, and I go to the gym. I even have a cell phone!" Robin says her sense of spiritual fulfillment is what leads her to feel she has "enough."
The Bottom Line: If that latte takes up a half-hour of your life, make sure you really enjoy it. Stay connected to the things that make you happy.
SUSAN STEWART, 47
As president of Charter Financial Group in Washington, D.C., Stewart finds herself working to convince high net worth clients that they have more financial freedom than they think. In each case, she says, there’s a number that’s "enough," even if clients are afraid to look at it.
"I think a lot of people jumped on their career paths years ago, and they’re being driven by things other than just money—achievement, success," says Stewart. "It’s not that they don’t have money, they don’t have time. I tell them, ‘Take a deep breath.’"
Stewart has wanted to help people achieve financial peace since she was a 25-year-old law student, when she was named executor of her father’s estate. "I had to go in and run his company," she remembers. "I got to understand the value of projections and goals."
Stewart became a retail stockbroker, thinking she would learn how to manage money. In fact, she was given a phone book and told to talk investors into buying whatever stock the company was pushing that day. She still fumes at the memory. "The industry is driven by sales, yet consumed as expertise. It’s appalling that people don’t understand that."
Determined to call her own shots, Stewart founded Charter Financial in 1995. "I’m a big-picture person," she says. "‘Enough’ for me is being able to retire at 55 with my current standard of living."
The Bottom Line: When you’re looking at the future, there is a number. Don’t be afraid to look at it: It can set you free.
CYNTHIA ROWE, 48
Store Manager, Home Depot
"My mother was on welfare," says Rowe. "I don’t think I knew I was poor, but there was always scrambling, and I knew I didn’t want to be like that." So Rowe started saving as a kid: "If I made $100, I’d save $10." By the time she was 46, she’d spent a dozen years moving up in the grocery business. Rowe was managing a Vons grocery store when a headhunter called. Would she be interested in a position as manager of a Home Depot?
"I wanted the grocery business to be my last career; change isn’t easy on anyone," she says. "But you have to be willing sometimes." Her willingness paid off: "I made almost twice as much last year as I did the previous year, because the bonus structure’s so much better."
Rowe allows herself luxuries, such as first-class trips to the Amalfi Coast and a 67-inch projection TV in her living room. But she buys them one at a time, and pays cash. Savings come first: Rowe contributes the maximum to her 401(k), IRAs and other savings instruments each year, and checks her accounts often—but doesn’t panic when they go down. After her 401(k) is maxed out by June, "Whatever’s left is for me to enjoy," she says. "I love to travel. I go to Cabo San Lucas once or twice a year, and Las Vegas on the weekends." Rowe also loves to gamble, and hits the tables at the Bellagio, but she never lets herself lose more than her preset limit. "Everybody says that after 9/11—or maybe ifyou’ve been ill—well, you might not be here tomorrow," says Rowe. "But you have to live for today and tomorrow. I want to be here when I’m 90!"
The Bottom Line: While you’re saving for tomorrow, don’t forget to live for today—and vice versa.
Originally published in More magazine, October 2005