— Kiera Mann is a hardworking professional who loves
her job as an operations manager at the office of an
international logistics and transportation company.
is also a single mom with a son in college, two children
at home, credit-card debt and lingering financial
fallout from a divorce.
38, desperately wants to get off her cash-flow treadmill
and start saving for the future.
not there yet," she said over coffee at a shop in
her hometown outside Seattle. "But it feels
Giboney, an area financial planner, offered to examine
Mann’s household finances and advise her for free.
What she saw was the financial profile of a working
professional with a good income but few assets who was
bogged down by large, recurring expenses.
congratulated Mann for keeping the household going by
controlling her spending on discretionary items, such as
needs to be praised for managing the day to day and
keeping the expenses down," Giboney said.
has long shown that the economic consequences of divorce
tend to fall more heavily on women than on men.
partly because women typically earn less than men.
Courts are also more likely to award children to mothers
than fathers. As a result, compared to men, divorced
women tend to form larger and more expensive households
that are based on less income, according to studies by
the City University of New York Institute for
can relate to that scenario. Her divorce, five years
ago, left her with debt and the custody of the couple’s
three children. Her oldest son is a freshman at the
University of Washington; the other kids are 9 and 10.
She receives no child support.
for the family, Mann has a good salary. Her take-home
pay is about $5,600 a month after taxes and withholding.
money goes quickly, however.
pays $2,630 a month to rent the family’s home;
utilities are not included.
payments on the family car, a Dodge Journey SUV, are
$405. Mann also pays at least $500 a month on about
$18,000 worth of credit-card debt.
is helping her son pay for his education at the UW. That
commitment costs her about $10,000 a year.
live-in boyfriend helps Mann by contributing to the
household, but it’s often just enough to break even.
has few assets. She carries about $2,000 in two bank
accounts and savings. She signed up for her employer’s
401(k) retirement savings plan, but she’s unsure about
the account balance and her monthly contribution.
of Mann’s financial weights is the home she once
shared with her former husband.
ex-husband got the house with the divorce, but Mann’s
name remains on the $250,000 mortgage.
of them have been underwater on the property since the
collapse of the housing market in 2008. Zillow’s
estimated market value for the unoccupied house is about
are now trying to unload the property in a short sale
with a listed asking price of $219,900. It may sell
ordeal damaged Mann’s credit rating. Her score, once
in the mid-700s, is now in the mid-500s, she said.
reached out for help, and the Financial Planning
Association of Puget Sound connected her with Giboney.
said separating spouses often leave their names on
mortgage documents for the family home after a divorce.
But they run the risk of getting dragged into costly
mortgage nightmares that damage their credit.
advice: Insist on a provision in the divorce agreement
that says the spouse who keeps the house must refinance
the property in his or her name only, and if the house
isn’t refinanced by a specified deadline, it must be
most pressing advice for Mann was to cut her expenses
and increase her income.
says she can boost her earnings with sales commissions
for getting new customers, and she plans to do so.
also advised Mann to systematically pay off her
credit-card debt, starting with the card that has the
smallest balance. When one card is paid off, the
freed-up money can be added to payments for the next
largest balance, and so on.
has adopted that strategy and is paying off a $1,800
credit-card bill. When that debt is gone in about three
months, Mann will turn her attention to paying off the
next-largest card, with a balance of $3,300.
also plans to become more engaged with her 401(k)
retirement plan and — at Giboney’s urging — see if
she can reduce the amount of pay her employer withholds
for federal income taxes.
is also helping herself. She paid off $6,000 in credit
card-debt before her first meeting with Giboney. And she
continues to aggressively manage her cash flow, which
she does with the help of spreadsheets and direct
she gets her monthly cash flow predictably in the black,
Mann wants to learn how to save money and build assets.
feel like I have a good plan in place to where I can
start building wealth," she said.