• About
  • Mortgage Basics
  • $40K Challenge
  • Aunt Doris
  • Grandfather Says
  • Privacy
  • Archives
  • 100 Words

Len Penzo dot Com

The offbeat personal finance blog for responsible people.

What the Heck Does a Household CEO Do?

By Len Penzo

ceoOkay, so you’ve heard me preach that the job of household CEO is a relatively easy one. I’ve already discussed the primary qualifications that every household CEO must have in hand, but just what is it that a household CEO does?

To answer that question let’s first look at what most corporations expect from their CEOs. When they are not drawing a fat paycheck, receiving copious stock options, enjoying all-expenses paid country club memberships on the company dime, getting their daily massage, or using the corporate jet for travel to various far-off business meetings at various resort locations, a corporate CEO is expected to define the company vision and provide any and all guidance necessary to turn that vision into reality; in other words, the corporate CEO decides where the company is going and how it’s going to get there.

Now how does that compare to the job description for the household CEO? Well, when they are not cooking dinner, taking the kids to and from school, changing poopy diapers, doing the grocery shopping, putting in a 12-hour work day at the office, mowing the lawn, or fixing the family car, the humble household CEO performs much the same role as the corporate CEO — without pay and perks, of course.

Specifically, the household CEO assesses the needs of the household, determines the resources (amount of money) required to address those needs, and then develops a plan that will ensure those needs are eventually met.

There are other differences between the two executives as well. Where the CEO runs a larger company, the household CEO is entrusted with running the humble family household; the household CEO is the household manager. And unlike their corporate CEO cousins, most household CEO offices are found in a small den or at the kitchen table, rather than in a large corner office.

Many corporate CEOs have at their disposal countless financial modeling tools and other powerful computational and forecasting algorithms. However, in most cases, the only tools the household CEO even requires are a pencil, paper, and maybe a cheap calculator (although, many household CEOs do take advantage of computerized spreadsheets, and other financial calculators when they are available).

And where the corporate CEO is concerned with earnings reports, sales projections, inventory information, and a plethora of other dry technical and financial data necessary for monitoring the health of his company, the household CEO is armed with not much more than a pile of bills, bank statements, and paycheck stubs. Finally, corporate CEOs usually have an army of corporate advisers and executive vice presidents to council them on all matters big and small. The humble household CEO is usually left alone to figure things out.

So what, exactly, does a household CEO do? In short, the six primary tasks of every household CEO are:

  1. Audit household spending habits
  2. Record household expenses and categorize them into wants and needs
  3. Create a strategic plan and an associated budget
  4. Communicate the vision and plan to the household
  5. Ensure the household sticks to the plan
  6. Refine the strategic plan as needed to address changing conditions

I will cover each of these tasks in more detail in future blog entries, but next I want to describe the duties of the household CFO.

Photo Credit: Schill

December 26, 2008

Comments

  1. 1

    Maggie says

    Really enjoyed this article. I’d much rather title myself “Household CEO” than household drudge. AND, my new fancy title reflects my “executive” responsibilities. 🙂

Trackbacks

  1. Treating Your Household Like A Business Isn’t Rocket Science – Len Penzo dot Com says:
    April 14, 2018 at 5:43 pm

    […] can run a household like a business, but to do it effectively you first have to appoint a household CEO in order to get the job done. Of course, the best candidate for running your household is always […]

  2. Powerful It Is: How Compound Interest Is Like the Force – Len Penzo dot Com says:
    April 16, 2018 at 4:16 am

    […] that the most powerful force in the universe is, well … the Force. But every successful household CEO knows for a fact that Lucas is dead wrong. That is not surprising at all given that Lucas is a […]

  3. Powerful It Is: How Compound Interest Is Like the Force -- USA Today says:
    April 16, 2018 at 5:03 am

    […] believing that the most powerful force in the universe is, well … the Force. But every successful household CEO knows for a fact that Lucas is dead wrong. That is not surprising at all given that Lucas is a […]

  4. 100 Words On: Why Lazy People Shouldn’t Automate Their Finances – Len Penzo dot Com says:
    June 23, 2018 at 1:02 pm

    […] of successful household CEOs automate their finances in order to save time and money, and help them reach their financial goals. […]

  5. Personal Finance 101: How to Create a Household Budget – Len Penzo dot Com says:
    January 27, 2019 at 6:24 am

    […] competent household CEOs use a budget to control spending, and help them save for retirement, emergencies, vacations and […]

  6. Black Coffee: Revenge of the Debt Monster – Len Penzo dot Com says:
    September 21, 2019 at 2:16 am

    […] answered last week’s survey question and it turns out that, for almost half of them, mom was the household CEO. Curiously, 6% of those who responded wasn’t sure who handled their family finances when they […]

  7. Why You’re Broke: You Don’t Audit Your Spending Habits – Len Penzo dot Com says:
    July 15, 2020 at 10:28 am

    […] that I’ve outlined a top-level job description for the household CEO it is time to begin breaking down each of those six top-level tasks in a little more […]

The Question of the Week:

What is the minimum annual income you need to be truly happy?

View Results

Loading ... Loading ...

Recent Posts

  • Black Coffee: Welcome to the Fun House
  • A Georgia Teacher Shows Why It Always Pays to Read the Fine Print
  • Why Extended Warranties Sometimes Do Make Sense
  • 10 Ways to Get the Most from Your Next Business Conference
  • 36 Amazing Uses for Plastic Grocery Bags
  • Black Coffee: A Ponzi for Your Thoughts
  • Grandfather Says: The Continuing Chronicles of Elaine, Part 6
  • What You Must Know Before Filing a Medical Malpractice Lawsuit
  • Million Dollar Neighborhoods Are Still Popping Up Across the US
  • Why Extended Warranties for New Tires Are A Waste of Money

Disclaimer

This site is for informational and entertainment purposes only, and the content herein should not be mistaken for professional financial advice. In fact, making investment decisions based on information published here, or any other website for that matter, is more than unwise; it is folly. This website accepts advertising in the form of monetary and other compensation; as such, topics of discussion are occasionally influenced by these advertisers. Sometimes, an article may also include affiliate links, meaning, at no additional cost to you, this blog earns a commission if you click through and make a purchase (for example, as an Amazon Associate I earn from qualifying purchases). Remember, you and you alone are responsible for the decisions you make in life, so please contact an independent financial professional for advice regarding your unique personal situation.

Sign up for the weekly Len Penzo dot Com newsletter
Len Penzo dot Com Delivered Weekly
Join more than 40,000 readers and fans who enjoy personal finance and macroeconomics with an offbeat twist!
Invalid email address
Thanks for subscribing!

Popular Now:

  1. 1. Scientists Say This Clever Trick Can Help You Break Your Overspending Habit
  2. 2. 4 Online Shopping Mistakes You’re Making and How to Avoid Them
  3. 3. When Is the Right Time to Use Your Wealth Insurance (Gold & Silver)?
  4. 4. Dear Friend: Here Are 41 Reasons Why I’m Not Lending You the Money
  5. 5. Home Repair Scams: Here Are the 9 Biggest
  6. 6. Trying to Save Money on Gas? Here’s Proof That Driving Out of Your Way Rarely Helps
  7. 7. How I Fought My Parking Ticket and Beat City Hall
  8. 8. Are You Frugal or Cheap? Here’s How to Know the Difference
  9. 9. Historical Gold & Silver Benchmarks for Wages and Commodities
  10. 10. 4 Good Reasons Why Some Quarters Are Painted Red

All-Time Most Popular:

  1. 1. 19 Things Your Millionaire Neighbor Won’t Tell You
  2. 2. Dear Friend: Here Are 41 Reasons Why I’m NOT Lending the Money
  3. 3. Why Your Expensive Luxury Car Doesn’t Impress Smart People
  4. 4. If You Can’t Live on $40,000 Annually It’s Your Own Fault
  5. 5. 21 Reasons Why Corner Lots Are for Suckers
  6. 6. 4 Smart Reasons Why College Isn’t for Everyone
  7. 7. 18 Fast Facts About Social Security Numbers
  8. 8. My Ketchup Taste Test: Upset! Guess Which Brand Topped Heinz
  9. 9. Why I Prefer a Spreadsheet to Track Expenses and Manage My Finances
  10. 10. Here’s a Simple Trick for Getting Credit Card Interest Charges Waived

Copyright © 2023 Len Penzo dot Com · All Rights Reserved · Designed by Nuts and Bolts Media

© Len Penzo dot Com 2008–2023