In this week’s Ten Money Questions, we speak with Morra Aarons-Mele, who serves as BlogHer’s Political Director in addition to covering politics as a Contributing Editor. She’s also a grad student, political consultant and frequent media commentator. I’ve caught her more than a few times on CNN. She gives her financial take below on school, mortgages, politics and her whopping wedding bill. Enjoy!
1. What kind of return do you hope to gain on your grad school investment?
Well, I did a career change, and I needed a credential to help me along, so my grad school is more of a credential than an ROI. My big return is that I hope to complete my doctorate, which will allow me to work clinically in the field of adult development, do research, to teach, to write and to consult and carry the kind of capital-C credential I'll need to do my work. I won't know the real return for a long time, but in terms of return on investment, it has already helped. It's a wonderful door-opener.
2. What is your most significant memory about money?
Yikes! My parents fighting about it. Divorced parents, money as a weapon/bargaining tool.
3. What is your worst habit around finances?
I have compulsive "bag-lady" syndrome, where I think I'm going to be broke and on the street, and then I'll go buy a new handbag. Money is not always rational for me. I fear being broke, but at the same time, I am terrible at living on a budget. But the older I get and the more I see how my money can work for me, I become more rational.
4. Is there a price to pay for participating in the political process?
To start out in politics, sadly, you can't really earn much money. This favors the very young and the wealthy. Luckily, once you get your start it pays ok, but it's quite unfair because the kids who work on campaigns are either there because they are really, truly ok with earning no money for a while and sleeping on people's couches, or, their parents supplement them. Honestly, I think the most fun way to participate in politics is to be a blogger, or to be a rich donor. Or, to be a highly paid consultant like the people you see on TV- that's an exhilarating career I bet. But tough, because you need to budget for the off season.
5. What’s this business with having 2 mortgages?
I have 2 mortgages because we have two properties! My old single girl condo, which we rent out, and our house. We have long term fixed rate mortgages on both, luckily, at good rates.
6. Did your parents ever disagree about money? Are there any similarities with how you and your husband handle and negotiate finances?
My parents only ever disagreed about money! Still do. It's almost become a joke in our family. My husband is really wonderful about money: it's money to him, not emotions or a bargaining tool. He knows my craziness and bag lady fears and so mostly, he handles the mechanics of big financial decisions. We discuss them together and run the numbers, and I still know what's going on, but the truth is he is more rational and better at it than me. On the other hand, I can be more prudent than he. We're still figuring it out. We have two rules I like: no one can spend over $200 without asking the other (I read that somewhere) and we try to have a "money discussion" time at least once a month. We have a detailed budget that we reconcile and compare actuals and all that. We also have a great joint checking system, and our own accounts.
7. What are your views on student loans?
Well, they are usually necessary. To me, it's preferable to have student debt at 6.8% than credit card debt at 14%, or home equity debt at 8.75! Our education system is insane- who can afford $50k a year? I am so glad Harvard took the step of subsidizing more students' tuition at a higher parental income bracket, but grad school is a bear. I have loans, but I have two rules for myself, since my grad school was not necessary for my career. I don't have commercial loans: I only took out Federally Subsidized loans, and aim to get as much money from non-interest bearing loans like the Perkins as possible; on the ones that gather interest while you're in school (like Stafford loan), I pay my interest off on them each quarter or so it doesn't accrue.
8. Based on your Facebook photos, it looks like you had a big wedding. Was it worth the tens of thousands of dollars?
The wedding was a very tough decision, and indeed, we eloped at first to the Courthouse, just the two of us. I didn't believe in big fancy weddings and didn't want to spend the money. But we did, because it felt like the right thing to do, and our families were so generous. The wedding cost $50,000: not cheap, not Bridezilla either. Everyone chipped in. It was worth every penny. It brought together the family in such a powerful way: the divorced parents, bi-coastal families, different generations. But it was a leap of faith, and preparing for it was so hard sometimes. Most people thought our wedding cost at least twice what it did: it seemed really expensive. But we worked really hard to make it seem more elaborate than it was. With creativity, lots of time, and good decision-making we had a wedding that looked several times more expensive than it actually was. My husband joked: you CAN have your cake and eat it too. Actually, we skimped on the cake. It wasn't worth the extra bucks- and it still looked and tasted great!
9. What did your stint at Edelman teach you about money?
It's better to have the money than to be on the payroll of those who have the money.
10. I see on your blog that you recently read The Life Cycle Completed. Does money influence the stages of human development, specifically old age?
To me, money can be an emotional thing, not a tool, and having a healthy relationship with my finances is a goal for me to work on as I grow up. I think women and money have a very tough relationship. I'm 31: money is about enabling my plans and my family's future. I'm in Erikson's generative stage, getting ready to prepare for the next generation. It feels like there will be more money someday than there is now. I hope so! For my mom, at 66, money is a safety net. When I was 25 and earning what seemed like a lot of money in London, money was fun and allowed me to try out many things; I was so lucky.
So I think our lifestage influences our relationship with money. It has to. What scares me now is the fear of recession, the threat money represents. For my generation, who has always had so much, this will be hard. The early 2000's were just stunningly rich for young, college educated people. And now everything is changing. That is just terrifying. But my Dad was born during the Great Depression, and so from him, I try to keep a sense of perspective.
More about Morra Aarons-Mele
Morra Aarons-Mele is a blogger and political consultant who is also a graduate student at the John F. Kennedy School of Government at Harvard University where she specializes in women and leadership. In between classes, she covers politics for BlogHer.com and serves as BlogHer’s Political Director. Morra is also a columnist for TechPresident.com and a frequent media commentator.
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