How Heidi N. Moore Does Money

We all do money differently. How do you do money, Heidi N. Moore, Marketplace NYC bureau chief and Wall Street correspondent?

Logan Sachon: Let’s talk about your money. Do you use credit cards? 
Heidi N. Moore: I do not. I actually don’t have a credit card, I only have a debit card. The last time I had a credit card was in college, and I ran it up really fast. It was a pitifully tragic credit limit, like $600 dollars—it was one of those Capital One cards they send you in the dorms. I maxed it out so fast, on nothing, just stuff that offered momentary comfort.  I was just buying stuff. And most everything you buy is a depreciating asset. As soon as you take it home, it loses value. I’ve gone to The Strand with stacks of books and gotten nothing for them. Clothes are useless, you can try to resell them but really you just end up giving them to charity. The only thing that I think is a really good use of money is experiences—travel or a really great dinner with friends.

So after I saw just how easy it was to do that, and how hard it was to control, I swore off credit cards. So ever since I was 20, I haven’t had a credit card. I just spend what I have.

LS: But how do you know how much you have to spend? 
HM: It’s really hard to get very specific about these things in your own life. I found it really helpful to actually see where all of your money is going—to see it on a spreadsheet or a list. I’ve started to use Mint, and I used to keep a list of what I spent. You leave the house in New York and you’re out $20, and you haven’t even bought anything: a coffee, a bagel, a newspaper, a MetroCard. $20 bucks a day—that’s $7,300 a year. You could go to Europe for that. So you have to pay attention.

LS: Do you have a budget set for yourself? 
HM: So there are my expenses, the list of things I absolutely have to pay, and then the rest I’m kind of flexible with. I do keep my expenses very low. My only fixed expenses are housing, gym, MetroCard, and my goddamned metastasizing Verizon bill, which is the bane of my existence.

And if you keep your expenses low, basically you would be shocked how much money you have. Which is what I try to do, although I am not above splurges.I just prefer intentional splurges, rather than impulsive ones. For instance, I held out on buying an iPad for three years because I wasn’t sure it would justify the expense of the device plus the data plan. Same for the iPhone. Now I have both and I love them. But I made Apple work for that money. 

Really, though, I misjudge too. Often! Very often. I just try to be right more often than I’m wrong. And I realized that the way you manage money doesn’t change all that much with income. I have a friend who makes very little—she works at a nonprofit—but saves very well and watches discount airline fares and thus always has money to go to Guatemala, Thailand, or wherever.

I’m not a fan of micromanaging. I’m a fan of setting your principles. When I go into a store, for clothes or books or whatever, I ask: How important is this? I’ll often take a picture with my iPhone, and if three days later I’m still thinking about it, I’ll go back and buy it. In the store, it’s in front of you and it’s so cute and so tempting and it’s in just the right light—it’s hard to resist. Or if it’s a book, you read it in a day and then it’s on your bookshelf for ten years.

It all becomes much easier if you start to believe that almost everything around you should represent you. The things you own should be something that you truly love, and most the things we buy aren’t. If you can avoid those things, you can control your expenses. It’s about exercising that judgment. Money is a state of mind issue. You work from principles: What is important to me, what do I want in the future—start from there and work backwards. If I want to be comfortable no matter what happens, I have to do that for myself.

LS: Is this something you developed on your own, or did your parents teach you? 
HM: I grew up in a house that didn’t talk about money, and I had to figure it out on my own. My mom is excellent with money, just really magnificent with it, but she didn’t talk about it. My parents wouldn’t let me have a job in high school at all—studying was the most important thing. But when I was 17, I decided I that didn’t want to ask anyone for money ever again. I wanted to be independent. So in college I got a job, sometimes two jobs or three jobs, to keep up the lifestyle I wanted. But my parents paid my tuition, so that was a possibility for me. And it’s not like I was immediately Jean Chatzky.

In terms of spending money, if you set yourself a financial goal that is necessary in your life, you’re likely to meet it. I have tremendous sympathy and understanding for people right now who can’t do that.  This is a crappy economy, and it’s not easy to get jobs that will pay you enough to meet all the obligations you have to meet, even just as a single person living in NY. So if you get to the point where you’re like, “Okay, my parents can be my fallback, but I can’t use them to sustain me,” I think that’s a good goal.

LS: So what do you spend your money on? Vacations? 
HM: I went years without vacations because I’m such a workaholic, and that sucked. I did not enjoy that. The mental health value and general perspective change of a vacation is something I really enjoy, so now that is a priority for me, and I save for them.

LS: How do you save? 

HM: The first time I looked at my 401(k) statement, I was like, “Holy moly how did that money get in there!?” I never would have done that on my own. So that taught me the value of making the the money invisible. I have a Chase checking account and three savings accounts. So my first savings account is savings I need to live for the next three months or whatever. The second one is for if I want to buy house, so future things. And then the third is for vacations. So a portion of paycheck immediately goes into each of those savings accounts each month. If it goes into your checking first, it seems like it’s your allowance and your job is to get it to zero.

LS: I don’t even have one savings account.
HM: Of course if you’re young and paying New York rent, it’s going to be hard to put much away. If you’re living in New York, you have this understand that living expenses are going to be 50% of your spending. But even if you’re just saving 10%, that’s 10% more than you had the month before. This is just my solution—there are a lot of other solutions. I think the most important thing is to keep your mind on future goals. It’s fine to charge a trip on your credit card if it’s once in a lifetime experience, but you need to have a plan to pay that off.

The only reason you should care about money is options. If you don’t have money, you don’t have options—you don’t get to exercise free will, and if you don’t have free will, you’re a slave. A lot of young people freelance and have low-paid jobs, so a lot of this isn’t realistic. Like if you’re making $17,000 a year as a fact checker, this isn’t realistic right now. But there are also things you have to invest in for your life. If you’re a radio reporter you need equipment, if you’re a photographer, you need cameras. Having that judgment about what is frivolous or what is necessary is a lifelong process.

One of the books that woke me up—I must have read it in college, but I don’t know why I read it—was called Prince Charming Isn’t Coming: How Women Get Smart About Money.  I don’t remember any of the specific advice, but it had a lot of stories about women who just had magical thinking when it came to money. That it was all going to work out, if not in a form of a man, than in the form of a windfall. There were all these stories of women who had real complications in their lives, and they had to start from scratch and it was a huge reality check for them.

LS: Banking on a windfall. That sounds very familiar…
HM: Reading that when I was young impressed upon me the idea that if you have you save for yourself. And beyond that, if you spend your money well, if you don’t just spend it all on stuff, you have some to give to charity or to spend on other people. You can help do good in this world. And you can’t do that if you don’t have disposable income. I do believe the more you give away the more comes to you. I don’t like the selfish view of money. I think it’s important to support causes. There are cosmic values to this.

I am by no means an expert in money management. It’s important not to look at other people—that’s not your life. Your life is your life. You don’t know what compromises other people are making. We’re all just cobbling it together.

LS: You mentioned you have a 401(k). Is saving for retirement a priority? 
HM: Right now, retirement is not a tremendously top goal for me. I want to save money for other things, like a house. So I do make 401(k) contributions, but I don’t pay attention to it.

LS: Do you invest?
HM: Nope. I can’t do it, because I cover Wall Street, so I can’t have stocks and bonds.

LS: Has covering Wall Street influenced how you manage your own money?  
HM: I generally keep work and myself separate. The money I write about is like Monopoly money—we’re talking about billions and trillions of dollars. But it’s good to know how a company’s balance sheet works, and that’s applicable. Really high finance has very little to do with personal finance. The things that companies do, we would all get arrested if we tried. So it’s not tremendously useful. But this isn’t the kind of thing where more knowledge will solve all your problems. We all know that to lose weight you need to exercise and eat less, but you have to get to a point where you apply that. I don’t think everyone just wakes up one day and figures it out. You have to relearn it everyday.

The idea of living within your means is something that our society has been missing for decades and decades. It should be a comfort to young and middle-aged people that people die never figuring this stuff out. It’s hard. But to know you need to figure things out is an awesome place to start, and that’s a form of wisdom that it takes people years to get to. I think it’s valuable to hit bottom. It teaches you that it really sucks to be in that position—it’s like aversion therapy.

Photo: flickr/ @yakobusan Jakob Montrasio

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44 Comments / Post A Comment

Mike Dang (#2)

I love Heidi Moore so much, and want to be her when I grow a tiny bit older (Heidi, are we the same age?). Heidi, thank you also for your >awesome explainer on the JP Morgan debacle!

Dancercise (#94)

It’s nice to hear from a lady who has her financial life figured out! Now if only I could get there myself…

It would be helpful to know how old this person is and how long she has been working.

@Reginal T. Squirge She’s in her thirties. And here’s a summary of her impressive career: http://www.marketplace.org/people/heidi-n-moore

NoReally (#45)

Massive respect for all this. The three savings accounts. That. And making the contributions at the beginning of the cycle and not the end. But if you don’t do stock market, what do you do? Foreign? Treasuries? Gold bars buried in basement?

lalaland (#437)

@NoReally Per a little googling, it looks like she graduated Columbia in 1998 and has been active as a reporter/journalist covering Wall street since.

lalaland (#437)

@lalaland That was @Reginal T. Squirge. Oops!

mishaps (#65)

If Heidi wants a house, she needs to get a credit card.

I also was a debit-card-only girl after grad school, for the same reasons as Heidi is, and my credit score EXPIRED. I couldn’t get a 30-year fixed-rate loan, and this was during the go-go real-estate boom. I spent two years building a credit score before I finally bought an apartment.

This is the STUPIDEST, most annoying thing, that committing to live only within your means puts you at a disadvantage, but better she should find out now than after she wants to put down a bid for a place.

@mishaps also the further you get into adulthood without having a credit card, the harder it is to get one! I find this the most bizarre thing, and by “far into adulthood” I mean my 24 y/o friends are having a hard time.

I don’t understand how she can say she actually doesn’t have a credit card. How can you make travel arrangements without one?

City_Dater (#565)

@redheaded&crazy

If you have a debit card, attached to a checking account, with a Visa logo on it, it can be used just like a credit card.

mishaps (#65)

@redheaded&crazy oh, that was never my problem! Pretty much everyone will take a debit card instead of a credit card, although they may put a “hold” on some of your money while you are renting their car/staying in their hotel. Plus most of my travel (and most of hers, sounds like) was for work, on someone else’s credit card, so that was not even an issue.

Tell your friends – get a secured credit card, pay it off like clockwork for a year, get it unsecured, get credit. Annoying but it works.

@City_Dater huh! I actually did not know that about using debit instead of credit for things like hotels, planes, car rentals. Good to know.

@mishaps I think my friends who were having issues have managed now to get credit cards? Not sure if they went that route or what, but I know it was way more of a hassle for them than for me at 18 which seems sooo backwards to me.

@redheaded&crazy I got a credit card at 18 and my credit is so-so (but improving! damn unemployment!) My boyfriend, who is historically way more fiscally responsible than I am and makes triple the money, has been denied a credit card AND a secured card because of “unavailable credit history” which means, as far as we can tell, that he’s a 29 year old who’s never had a credit card. No one will tell us anything because the bank refers us to Experian, who refers us to the bank…seriously, it’s a massive headache. And that is the reward for living within his means for 11 years. wtf credit?

DoctaJones (#847)

@dj pomegranate I had a similar problem when I didn’t have a credit card at 24 and tried to get an apartment. Apparently the problem was that my driver’s license address was not the same as my billing address. So when they ran my info nothing was coming up. For some reason when I corrected this I magically had a credit score and qualified for a card through my bank.

a small sea (#887)

@mishaps This seems like the perfect opportunity to ask about something I’ve been wondering for a few weeks now (really, since I read about Logan’s credit card debt). It seems like, unfortunately, having a credit card/credit score is really important for future things, right? Can The Billfold do a post about how to get, use, and manage a credit card in a way that is helpful to your future-self and doesn’t mess your life up? I feel like this is important to know! Should you get one and like, just buy your groceries (or whatever) on it and pay it off every month? A few friends said you should only buy expensive things with it?! That seems potentially disastrous. Billfold: how do you navigate getting/having a credit card without ruining your finances? Also, what kinds are best for which people? I’ve tried to look through older posts and have gotten little snippets and whatnot but this should totally be its own post (if it isn’t already!)

Ellie (#62)

You REALLY DON’T need a credit card. My mom has lived almost the entirety of her life without it. Everywhere takes debit. You can’t ever spend money you don’t have. I had a credit card for a while. I mean, I still have it, but I don’t use it anymore. It was just another stressful thing. I have not had to do anything where not having a credit card impacted my life. I’m not going to buy a house for like twenty more years. I’m not going to suddenly decide I need to buy something I can’t afford, and even if I did, I wouldn’t be able to, which is also good! When I was using my credit card, I would sometimes buy something with it because I was depressed by the idea of losing that amount of money right away, which is so stupid because the more time goes on, the less money you’ll have, not more. (I was unemployed at the time though . . . I can imagine it being different for people with jobs, but I’m employed now, and it’s honestly not)

Ashley (#509)

@a small sea Agree with what Ellie said, you don’t need a credit card – I’ve never had one, but I do have tremendous student loans (fun!) so when I moved to LA a year after college I had no problem with my credit check for an apartment, and the same for when I got a new car. And I think I’ve been late like, maaaaaaaybe once on my loan payments. So there are other ways of having good credit than getting a credit card (which I am really thinking about, because I a lot of my friends have them and get SO MANY AIRLINE MILES and I’m so jealous, but I am also incredibly scared of missing a payment and then starting down the debt spiral that I know most people are in with credit cards).

Spinach Party (#253)

I think Heidi Moore is my financial soul mate. Practically everything she said is exactly how I think and feel and act on money. This: “The only reason you should care about money is options. If you don’t have money, you don’t have options—you don’t get to exercise free will, and if you don’t have free will, you’re a slave.” 100% agree.

And also 100% agree about having “tremendous sympathy and understanding for people right now who can’t do that.” Practical, put-together and loads of empathy? My new girl crush.

Spinach Party (#253)

@Spinach Party And also “I’m a fan of setting your principles/what do I want in the future—start from there and work backwards.”. Yes, perfect. I think your personal values and principles are the strongest guides (and the best starting point) you have when it comes to navigating personal finance.

I’m kinda giddy over every single point she makes. It’s nice to see my own personal philosophies put so eloquently.

chic noir (#713)

@Spinach Party Yeah I said the same thing in the “I blew my 66k inheritance” post Money= Power.

I guess that’s why I don’t understand how lottery winners and professional athletes blow thru millions of dollars. Sure splurge a little but enjoy your freedom.

Knowing I would never have to work a job that I hated because I have dollars to fall back on is such a mindgasm.

@chic noir exactly!

Changeling (#126)

@Spinach Party
I mostly enjoyed this interview, but something about “you don’t get to exercise free will, and if you don’t have free will, you’re a slave” just rubs me the wrong way. Poor people are slaves? Huh? I understand that money = options, and options are great, I was just thrown by the wording I guess.

OhMarie (#299)

I’m actually really curious about the investing thing. What do you do?? Just have your 401k in a savings account? Or is it, like, managed by someone else so you actually do have some investments but you don’t/can’t see or touch them?

lalaland (#437)

@OhMarie I think as long as it’s not a bond/stock she personally trades, it’s okay – like she can’t buy GOOGLE but if GOOGLE were “prepackaged” as part of a fund or an ETF, it’s okay. Also, I THINK she is allowed to trade but she has to disclose…I could be wrong on this point since it seems like she isn’t doing so.

I love reading things like this, and would love to get more into the finer details of how people manage their money, but the quote that struck me most:
“The things that companies do, we would all get arrested if we tried.”
That is so…frustrating.

Ellie (#62)

@Splendorofmorgan True. I find all this stuff really interesting though – finance and economics is my “fun to read about but will never not ever be involved with” hobby. I really enjoyed Heidi’s summary of the JP Morgan events.

Wow, thanks everyone for your intelligent and curious comments. It’s such a privilege to talk with such attentive, smart people.

Also, Mike Dang, I think your work is fabulous. And Logan, who is a great interviewer and one of the funniest, smartest people writing about money right now – you guys got it going on.

You guys already handled the debit card thing – I have a Chase card, which is a Visa and works exactly like a credit-card. If it didn’t, I couldn’t stick with just a debit-card. In fact, I lose my card every so often and that little replacement card – which just works at ATMs, no credit, no charging – drives me up the wall.

Another trick I’ve tried, that I liked but is not good if you walk through sketchy neighborhoods: Set yourself an allowance at the beginning of every week, withdraw the money in cash, and use only cash for your purchases. You’ll see your spending drop immediately.

As for investments, yes, I cannot actually buy or sell stock – even with disclosure. I used to work at the Wall Street Journal and write for the New York Times, and the ethics policies there dictate that you can’t own any stock of a company you write about. I have had that rule for my entire career. I cover Wall Street – the banks – and so I end up writing about basically every company on earth. So I stay out of the market entirely. I just have my 401k. That’s pretty unique to just my job, though. If you can invest, do your homework and try it. But be careful!

Thanks everyone. It’s so wonderful to see young people actually tackling the whole issue of how to manage money. It gives me faith in humanity! -Heidi

Hope that helps! Thanks

jfruh (#161)

@Heidi N. Moore@twitter I just have my 401k.

But a 401k is just a container for investments! Like, what’s in there? Mutual funds? ETFs? What?

chic noir (#713)

@Heidi N. Moore@twitter Set yourself an allowance at the beginning of every week, withdraw the money in cash, and use only cash for your purchases.

*chic noir e-hugs Heidi*

Yup, I do this. I think it so much harder to spend actual cash vs a debt card.

I find that using cash makes it so much easier to keep track of my check book thereby decreasing the likelihood of getting an overdraft. I hate overdrafts and only get about one per year that I promptly have overturned.

*sly smile*

Thirty-five dollars for a cup of coffee and a sandwich, I don’t think so.

cash> debit card > credit card

@jfruh I literally have no idea! It’s a company-chosen set of mutual funds.

bitzyboozer (#885)

@Heidi N. Moore@twitter I think the cash-only rule works for lots of people, but personally it just does not work at all for me. Maybe it’s because I am one of those few weird people left who actually balance their checkbook religiously, but for me, once that money is out of the bank, it’s gone. I could spend it on anything at all without giving it a second thought. I’m much more careful about my spending if I actually use the card and write down the amount and do the math. Of course this only works if you’re actually going to commit to doing that!

chic noir (#713)

I’m like only half way through the interview but let me just say this is like the best interviews about money I’ve ever read PERIOD. Heidi is just so plain spoken and says ink in a way that anyone can understand.

You know how with some financial people you need a thesaurus or table for acronyms and industry slang to understand what the expert is talking about; well you don’t need any of that to understand Heidi

I’m going to print this off for my younger cousin to read.

Mike, Logan and rest of you ladies and gents who write for this blog, you rock!

It all becomes much easier if you start to believe that almost everything around you should represent you. The things you own should be something that you truly love, and most the things we buy aren’t. If you can avoid those things, you can control your expenses.

Heidi had so many awesome quotes here but this one truly hit me.

jfruh (#161)

I have to ask the “I don’t have a credit card” people: You all know that no one makes you carry a balance on your credit card, right? That it’s basically a floating no-interest 30-day loan? I mean, yes, racking up debt and interest payments are bad, but if you’re disciplined enough to put money away and save for retirement and whatnot, surely you’re disciplined enough to pay off your credit card every month?

chic noir (#713)

@jfruh – Some people prefer to avoid temptation.

I can eat find it pretty easy to not eat an entire bag of potato chips.

For some people, weed is not a gateway drug.

mishaps (#65)

@jfruh back in the Dark Days, before every bank was on the internet, I would not pay my credit-card bill on time, even when I had the money to do so. I mean, you needed a stamp! And a check! It was a lot of pressure, as I am sure you recall as well.

So a debit card was definitely a form of discipline for me, but it wasn’t just budgeting discipline.

DoctaJones (#847)

@jfruh When I first started handling my own money I avoided credit cards. I was afraid of the temptation and rightfully so. I look back on those first years of my money management and it’s a sad thing. I’m glad I didn’t get a card because it’s very likely I would have racked up a lot of debt on the idea that it is a 30-day loan. Not having a credit card made me deal with things upfront like overdrawing my bank account, the embarrassment of asking for loans from family, and the feeling of being left out when I couldn’t afford to go out with friends or travel or buy new clothes. Essentially I gave myself some tough love to learn how to live within my means. I have a credit card now but it has a very low limit, about enough to deal with an emergency, but I haven’t used it in almost two months. If I want to do something now I save for it. I automatically think in terms of how much money I have right now rather than how much I can put on a card and pay off later. Basically, I don’t use credit cards because I’m NOT great at money, or at least I don’t trust myself enough.

jfruh (#161)

@mishaps & @DoctaJones & @chic noir — sorry, I don’t mean to be mean! I definitely understand the need to keep temptation at bay (this is why I don’t keep any snack food in the house, heh). I guess I just see so often in pieces like this statements along the lines of “Don’t get a credit card so you live within your means” or the like, implying that carrying balances are, like, a required feature of having one. As pointed out upthread, they can be very important for helping build up your credit rating.

One thing a friend of mine does is have all of his regular, recurring bills that are basically the same every month put onto his credit card, which he pays off every month, and he uses the card for nothing else. Essentially he uses it has a bill-consolidation service, and he knows what it’ll be every month so he budgets around that. That way he gets the advantages of credit cards (building up credit, plus I think he gets points or something from his) without using it in dodgy ways.

lalaland (#437)

@jfruh Thank you! Nothing against the no credit card people, but for a second, I was questioning my usage of credit cards – what am I doing wrong??? I pay it off in full every month and don’t buy anything I can’t readily pay for with cash (obviously I’ve yet to make any major car/house related purchases). I guess it’s easier for me to avoid credit card temptations than snack foods too :)

chic noir (#713)

@@jfruh sorry, I don’t mean to be mean!

No problem :)
*e-hug*

! I definitely understand the need to keep temptation at bay (this is why I don’t keep any snack food in the house, heh).

Yea, I just people have different strengths and weaknesses. A money weakness is so dangerous because one bad move, you could be on the line for tens of thousands or even hundreds (mortgage) of dollars.

a small sea (#887)

@jfruh Oh, I should have read the comments before posting earlier. THIS. YES. Posts about how to (successfully) have a credit card.

Ellie (#62)

I’m terrible at doing things on time – I’m almost always late with my student loans for example. It’s the same reason I never want to take birth control pills, I know how to do it right but am confident I would forget it all the time. It’s also just annoying to have another thing to think about.

ThatJenn (#916)

I’m interested to know how and when Heidi transfers money to her checking account for this month’s living expenses. Many savings accounts won’t allow you to pull out money from them more than X times per month without a fee – so, is it a monthly process of pulling out everything needed to pay the bills, plus everything she thinks she’ll need/want to buy this month? (I’m assuming that “living expenses” account covers small non-necessary purchases, like a dinner out every once in a while or a gift for a friend’s birthday.) This is something I’m really interested in doing.

I get paid monthly but budget weekly, because my main expenses (rent groceries etc are weekly). I move $500 into my chequing account every week to that end. (I have a bunch of savings accounts with my main bank as well as my main transactional account, for long term savings, bills, travel etc – and there are no fees that get in the way. I am in NZ though.)

ThatJenn (#916)

@eemusings@twitter Interesting approach – I might start trying it! Thanks!

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