Money Matters by Susan Hirshman



It’s beginning to look a lot like tax day and our finance expert Susan Hirshman tackles a topic many couples can relate to…File Denial
If you are married, should you always file your tax returns jointly with your spouse? Most people will answer yes because they think that’s the best way minimize your tax bill. Often, times the that is the right answer – because married filing jointly gets you the most favorable tax rates.
But, should lower tax rates be your only criteria? NO! with a capital N and a capital O.
I say this because of the following three words “joint & several liability.” Joint liability means you and your spouse are both liable; several liability means you’re each liable for the entire amount not just your own share. In other words, if you file a joint return and the information is false or wrong, the IRS can go after either of you because you both signed the return. This typically happens when one spouse knows more about the couple’s finances and files the tax return. Often, the other spouse simply signs the return without really understanding what’s in it.
To make this come alive, let me tell you the story of Jack and Jill. Jack and Jill are married and file their tax returns jointly. Jack owns his business and doesn’t report all his income on their tax returns. A few years later they are audited by the IRS and it is determined that they owe an additional $100,000 of taxes plus interest and penalties.
Who do you think the IRS will go after to collect on Jack’s tax bill? (a) Jack? (b) Jill? (c) Anyone they can? If you picked answer ©, you are correct, even if they are now divorced.
Jill can’t believe that she is liable for the taxes on the income her husband under-reported. But she is – unless she qualifies as an innocent spouse or under the equitable relief rules as defined by the IRS. Not everyone qualifies, so never assume you would be. Instead, before you sign on the dotted line make sure the numbers on the return make sense; if not- ask questions. Bottom line – don’t be a victim. Protect Yourself.
picture.jpgSusan Hirshman is president of SHE LTD, a consulting firm focused on enhancing the financial literacy of women globally. She is the author of- Does this Make My Assets Look Fat? – a women’s guide to finding financial empowerment and success. Formerly, she was a Managing Director, Wealth Manager with one of the world’s top financial services organization.

Money Matters by Susan Hirshman

assets.jpg Recently I was interviewed for a story in the New York Times that focused on “money talk” for couples. I received so much great feedback on the story that I felt compelled to address it here.
The article opens up by saying…”One of the most difficult conversations a couple can have is not about love or commitment. It is about money — how it is saved and invested and what it means for their lifestyle.”
Do you agree?
I do. Why? I hear it practically every time I give a talk to women and open it up for Q&As. The questions usually sound something like this: How do I start a conversation with my husband about money? How do I ask my partner to see our finances without having him feel like I don’t trust him? How do we have a conversation without fighting?
Three words here…. communicate, communicate, communicate. Sounds simple, right? But as we all know “communicate” is not always simple – especially when it comes to money. You’d be surprised (or perhaps you wouldn’t be) by how many people don’t know how much their spouse is making. Generally, the problem is due to the highly emotional feelings (self worth, self esteem, power, control etc) and unresolved issues with money each partner brings to the table.
So sit back and have a think. What does money mean to you? How does your upbringing and past experiences affect your money attitudes? What stops you from having these conversations – fear? interest? knowledge? lack of ownership? bigger relationship problems?
Having these initial conversations may not be easy but if you don’t have them you have a high chance of becoming part of the “if only” club. You may not know what the “if only” club is, but I am sure you know someone (dare I say more than one) who is a member. Do you have any friends, neighbors or family who were not involved in managing their finances only to find out in times of crisis that their husband was an overly aggressive investor, or he was loaned up to the hilt, or not saving for retirement, or not protecting the family from death or disability and so on and so on. What do you think are the first words out of these women’s mouths? Yep, you guessed it …if only I knew he was (fill in the blank), I would have (fill in the blank.) These scenarios break my heart, because they often result in unfortunate outcomes that could have been avoided or at least mitigated, if they were only talked about.
Therefore, the question I have for you today is this: Will you be willing to bear some discomfort today to learn whether or not your future is on a path that will give you the greatest probability of success? As the saying goes…”just do it!”
picture.jpgSusan Hirshman is president of SHE LTD, a consulting firm focused on enhancing the financial literacy of women globally. She is the author of- Does this Make My Assets Look Fat? – a women’s guide to finding financial empowerment and success. Formerly, she was a Managing Director, Wealth Manager with one of the world’s top financial services organization.
To check out Susan’s latest article in Project You, click on the image below…

Money Matters from the Author of Does This Make My Assets Look Fat

book cover-1.jpegThe author of Does This Make My Assets Look Fat shares her tips on how to manage your finances and invest like a pro!
Financial expert Susan Hirshman, author of the brand new book “Does This Make My Assets Look Fat” answers our readers’ burning money questions and breaks down the concept of investing and budgeting and puts it into terms any woman can understand.
As Susan sees it, the rules of successful dieting are the same rules that apply to successful money management. In her new book, Susan offers women a 3-phase personalized plan that follows common dieting programs to help them understand their finances.
Susan’s program completely removes the intimidation factor that often accompanies the words ‘personal finance’ and ‘investing’ and provides women with all the information they need to take control of their financial situations once and for all.
Question: How do you ‘get on a budget’? What are the first steps? ((We have a decent income-but we don’t have much to show for it!! We don’t waste $$ on material things-but we barely have anything saved.)
Susan: Believe it or not this question can be answered by discussing dieting and hidden calories. You know what I am talking about – those extra calories you ingest without really counting and paying attention to. The handful of M&M’s from your colleagues candy bowl, the second glass of wine, eating out of the refrigerator, and on and on. Dieting experts state that the first thing you have to do to is to find all these “hidden calories” that are sabotaging your success by writing down everything you eat.
Have you ever done this? If you have, then you are familiar with the first step in developing a budget – writing everything down and finding our “hidden expenses.” Hidden expenses just like hidden calories are things that are not memorable but when you add them together they become significant and tend to impair your financial success. ‘
Budgeting (I prefer using the term spending plan – doesn’t it sound much more palatable?) is all about awareness and measurement of your cash inflows (net salary, dividends etc) less your fixed expenses (those that are must have’s, i.e. mortgage, utilities etc) and your variable expenses (those that are discretionary, i.e. entertainment, clothes etc.)
Bottom line – if you don’t measure you can’t manage.
There are many tools available on the web to help you keep track of your spending plan. In addition your bank and/or credit card companies may offer tools as well. Get on it…☺
imgres.jpegSusan L. Hirshman is a former managing director at JP Morgan. She holds an M.B.A. from Baruch College and is a Certified Public Accountant, a Certified Financial Planner, a Chartered Life Underwriter, and a Chartered Financial Analyst. She currently lives in Manhattan.
If you have a money question for Susan, email us at beth@rolemommy.com.