Why Women Overspend
An Interview With Colette Dowling, Author Of Maxing
Out
By Emily Kay
With publication of The Cinderella Complex in 1981,
Colette Dowling received international acclaim and "more royalty
checks than I knew how to reckon with." A bestseller with
more than 20 foreign publishers, The Cinderella Complex
addressed the hidden fear women have of independence. Ironically,
Dowling far outspent her earnings in the years that followed,
and by 1992, she owed the IRS $70,000--a bill she could not
pay. In the following interview, Dowling discusses why many
women find themselves in financial turmoil, the theme of her
latest book, Maxing Out: Why Women Sabotage Their Financial
Security.
Q. Why do many women overspend?
A. I believe that credit cards have given women an
illusory sense of independence. Women are happy not to have
to go to someone else for money. There are also women who
use spending to alter their mood, or overcome depressions,
which gives them a further sense of control. And now, with
the Internet, they can go online and buy things at 3:00 in
the morning.
Q. How can a woman recognize she is overspending--before
it gets out of hand?
A. You're in danger when you don't know how much money
you have in your bank account at any given time. Or what your
total monthly expenses come to and how that relates to your
monthly income. It's a kind of denial mechanism.
Q. How can women learn to control their spending?
A. Having money of your own can be scary at first
because you have to learn what to do with it. The first time
I learned how to fix a flat, I had a mixed response. I knew
this was something I should know how to do, but I didn't want
to have to. I think it helps to keep a journal of your expenses
so you know what the categories of expenditures are and can
create a spending plan.
Q. Once a woman has her spending under control, what's
next?
A. If she has a huge amount of debt, she might want
to pay that off first so she can reduce her interest costs.
She then needs to put money away for herself and include that
in her monthly budget. She might use some of this money to
join an investment club. I was in an investment club for a
while, and I learned a lot. The best way to learn about investing
is by doing it.
Q. Are younger women better at managing money than their
mothers were?
A. Older women are astounded that their daughters
can put money aside or rent a house at the beach. No woman
in my generation bought much more than pantyhose. Some young
women only use their credit cards to buy something specific,
like a suit that they plan to pay off in a certain time. Often
these are the daughters of women who've had money problems
that they had to deal with on their own.
Q. What should we teach our daughters about money management?
A. We have to teach them as early as possible that
they must learn to take care of themselves financially. If
I had it to do over again I would have had my daughter contribute
more to the cost of her own education. That would have put
her more in touch with her ability to produce for herself.
At the time I had the money to buy what my children needed
and felt guilty requiring more of them. This is a trap many
women fall into. They don't feel entitled to the money they
earn and feel they should spend it on their children.
Q. What do you wish you'd been told about money?
A. I would have liked to know how money works in the
world, not just how to spend my allowance. I also wish I'd
learned earlier to see money as a good thing, and how I fit
into that. For years I lived with a man who made his money
as an investment counselor, which I thought was very boring.
Now I read the financial section of the newspaper and find
it fascinating.
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