Financial Advisory Winnie Sun learned a brutal lesson just before she went off to college after her frugal and hard working parents lost her college fund in a failed real estate venture. 

In Winnie’s money story you will learn:

-How her parents well-planned college funding evaporated right when she needed it

-The compromises Winnie made in reaction to the news

-How Winnie funded college

-The shift in Winnie’s relationship with her parents as she became a source of financial support for them

In Winnie’s money lesson you will learn:

-Why Winnie sees the unexpected financial challenge as a blessing in retrospect

-How Winnie applies what she learned to teaching her kids about money

In Winnie’s everyday money tip you will learn:

-How Winnie travels around the world for free

-Exactly what to do to upsize your point score when you shop

In My Take you will learn:

-The importance of supporting family and friends in financial need including older generations

-The best ways to leverage airline and credit card points over the holidays to lower your out of pocket gift costs. 

EPISODE LINKS

Learn more about Sun Group Wealth Partners

Follow Winnie on social media!

Twitter:  @WinnieSun 

Instagram @winniesundotcom

LinkedIn Winnie Sun

Facebook Winnie Sun

Some of the links in this post are affiliate links. This means if you click on the link and purchase the item, I will receive an affiliate commission at no extra cost to you. All opinions remain my own.

Transcription

Winnie Sun:
... we're proud of you for getting in schools that you want to get into but you can't go to college because remember that project we invested in in Claremont, well, the partner went bankrupt and so they're pulling us into bankruptcy. And so it's not just paying for college but we got to worry about paying the house and keeping the family together, like financially how we're going to keep this in one piece.

Bobbi Rebell:
You're listening to Financial Grownup with me, certified financial planner, Bobbi Rebell, author of how to be a Financial Grownup. But you know what? Being a grownup is really hard, especially when it comes to money. But it's okay, we're going to get there together. I'm going to bring you one money story from Financial Grownup one lesson and then my take on how you can make it your own. We got this.

Bobbi Rebell:
Hey, Financial Grownup friends, imagine if you had really financially responsible parents. They saved, they invested for your education, and then right when it was go time, the money went poof. That happened to investment advisor, Winnie Sun of Sun Group Wealth Partners and how it unfolded will keep you on the edge of your seat. Welcome, everyone to the Financial Grownup podcast. We talk to high achievers like Winnie Sun about pivotal money-related events in their lives so we can all learn from them. And we keep it short to about 15 minutes because you're busy. And with that, let's get right to Ms. Sun. Her story has a big plot-twist and stay to the end because Winnie has some great advice for up-sizing your point-score when you shop so you can travel in high style and for free, in many cases, like she does. Here is Winnie Sun.

Bobbi Rebell:
Winnie Sun, you're a Financial Grownup. Welcome to the podcast.

Winnie Sun:
Thank you so much, Bobbi. Excited to be here.

Bobbi Rebell:
Congratulations on all of your success with Sun Group Wealth Partners. You're also known as the Wealth Whisperer and of course, you were on the CNBC Financial Advisor Council which is a huge honor. You're all over the media and you're social media is amazing. I'm so excited to have you on.

Winnie Sun:
Thank you, I'm excited to be here with you.

Bobbi Rebell:
And you brought a wonderful bunny story that has a great happy ending. You were a senior in high school and your parents came to you with some shocking news.

Winnie Sun:
Yes. Yes. I was so excited about going to college. It's senior year, we're having a grad night and everything else. And I came home one day and I could tell there was something going on. I mean, there was just something going on with my parents. And my mom, I could tell, she came to talk to me. And my mom, just to give you some reference is like literally hard as nails. I mean, she's like an iron fist. I mean, she's a person that if you came home with anything less than an A or an A-plus, we would be in big, serious trouble.

Bobbi Rebell:
Right. So all of high school you're working hard. You're getting the straight As to go to a top school.

Winnie Sun:
Right. So I got into all the schools I wanted to and then she says, "I just want to let you know, we're proud of you for getting in schools that you want to get into but you can't go to college because remember that project we invested in in Claremont, well the partner went bankrupt and so they're pulling us into bankruptcy. And so It's not just paying for college but we got to worry about paying the house and keeping the family together. Like financially, how we're going to keep this in one piece." And so that was really sort of my first, big, scary financial moment.

Bobbi Rebell:
And had you had any inkling that this was such a risky project? Had you ever been involved in the family finances before?

Winnie Sun:
No, not at all. And in fact, I had zero interest in finances. It was really a project they had invested. I heard about that they were investing in this project but I didn't know my college education depended on this. They never even told me that. All I knew is that they invested in something and it would be for our future and all I needed to worry about was my grades. Because they were always really highly responsible with money. I mean, my family didn't spend money on anything. I remember going to Burger King for a 39 cent hamburger and this was like a treat. We do this maybe once a quarter. We just didn't spend money. And my parents were like incredible savers. They just invested in the wrong thing at the wrong time.

Bobbi Rebell:
This came as quite a shock. Had you had a job in high school at all? Did you have your own income in any way?

Winnie Sun:
I did. I worked all through high school. My earliest childhood memory of making money was when I was seven years old. I was selling avocados in my front yard. And then at nine years old, I was working in my parent's restaurant. I worked the cashier and I remember this because this is before really high-end equipment. And I actually memorized the tax card or tax code.

Bobbi Rebell:
Wow.

Winnie Sun:
I memorized how much sales tax was on every item, like soda or pizza. Yeah, that's what I did.

Bobbi Rebell:
So your family was hard working. They were budget minded. They were frugal.

Winnie Sun:
Yes.

Bobbi Rebell:
And they were investing for the future where they just put too much into the wrong investment at the wrong time, unfortunately.

Winnie Sun:
Exactly.

Bobbi Rebell:
And so tell us more about how that then played out.

Winnie Sun:
I decided to go to UCLA, which was local, instead of I was looking at Caltech, I was looking at Stanford. But financially, UCLA made a lot of sense because it was just about an hour and a half away from home and it was a public school. And I was excited about going there. And it also gave me an opportunity to start working right away because I had worked that summer right after the news hit senior year and then as soon as I started as a freshman at UCLA, I remember right after my first class that afternoon I made my way to the internship office to find work.

Bobbi Rebell:
Wow. And meanwhile, how were your parents recovering? What happened to them?

Winnie Sun:
Well, my mom is tough as nails, like I told you. So she got back to work. I mean, they were already in the real estate business. So my mom just ended up working that much harder and my dad helped here wherever he could. And then my job was just to not only do well in school, but just really find work. So I was juggling like two or three jobs throughout college.

Bobbi Rebell:
What kind of jobs? What jobs did you have?

Winnie Sun:
Well, I actually work access control at night which is where people want to get into dorms but you have to check their ID. So I worked the night shift. And then during the day, I'd go to class. And then I had an internship at a television show called Jones & Jury. And then I worked at an entertainment company as well. So I just did whatever I could do.

Bobbi Rebell:
Wow. You were busy.

Winnie Sun:
Mm-hmm (affirmative).

Bobbi Rebell:
And did you then have to help your parents with their finances?

Winnie Sun:
I did. So I got student loans and all that. And then whatever money that I could ... which wasn't a lot, whatever I could then I would give to my mom and help her out. And then the rest I just had to have enough money to pay for gas to go to work or some school supplies, books and things like that, that was all my responsibility.

Bobbi Rebell:
So what is the lesson for our listeners, what is the takeaway from this story for them?

Winnie Sun:
You know, I look back and I think it was the biggest blessing that could have happened. Because when you have financial hardship, it's all about perspective. Understand that this actually makes you much stronger financially and mentally when you get older. So I look at my own kids and sometimes I feel bad because they're not going to have these sort of same experiences because that struggle is what makes us better at money and in our entrepreneur spirit. But really, understand that it's important to see our options and also to have good financial literacy and have a second opinion on what you're doing.

Bobbi Rebell:
I know you work very hard at educating so many people with all of your different media projects. One thing you are passionate about, especially as we get towards the holidays is travel and leveraging your travel points. And you're going to share some of your tips for this because we're all obsessed with points. Let's be honest, we love points. There's something about them that gives ... It's almost like playing the lottery, like what will I choose now. You feel like you've won but there are ways you can win bigger with them. So tell us, what's your everyday money tip?

Winnie Sun:
I love this. You are my people. So my biggest thing is I love like the whole work-life balancing. And people talk about it all the time but I think you really have to be mindful and I do this to the fullest extent. So yes, you and I work a ton but on my off days, and that's like weekends or any holiday, I try to take my three kids and my husband all over the world. We are like travel maniacs. And so the best way I love to travel is to travel for free and how I do that is I travel on points. A lot of people think oh, yeah, I have a points credit card and a cashback card, I do that and I hear that all the time.

Bobbi Rebell:
But it takes so long to get enough points. You have a family of five, Winnie, that's a lot of points.

Winnie Sun:
But I get a lot of points.

Bobbi Rebell:
How do you get them all?

Winnie Sun:
I might teach you some ways. Especially going to the holidays because you and I talk about this. I love this idea. Now, during the holidays, you can actually rack up points much more quickly than any time during the year. And the best way to do that is to leverage normally credit cards that give you a nice healthy points like sort of multiply on where you spend. But also take a look at where you travel on, like, for example, if you travel on certain airlines that take American or Delta or United, each of these airlines has what they call a shopping portal. And if you go to these shopping portals, it gets to the website that you want to shop at, you can actually double dip and sometimes triple dip on points meaning the credit cards will give you points for that purchase and then the airline portal will give you miles for that same exact purchase. And this could be all sort of regular companies such as Target, and Walmart, and Amazon, typical stores that you and I would shop at. It's just a matter of taking that extra step.

Winnie Sun:
So what I always say is don't shop directly on a website itself. So let's say you want to buy at Target. Instead of going to the Target website, you should always go to either the airline portal or the credit card portal and then link over to Target. Because by doing that extra step, it will take like an extra 30 seconds, you'll then get an extra level of either points or miles which adds up really quickly.

Winnie Sun:
And then once you have the points, then take a look at your credit cards because your credit cards will often do bonus deals, airline deals, or hotel deals, and you can get like sometimes up to an extra 40, 50, even 100% more on your points for the same exact purchase.

Bobbi Rebell:
Amazing. Amazing. Tell me more about what's going on with you. I know your baby right now is your LinkedIn series. Tell us more about that.

Winnie Sun:
Yes. We got really excited about doing this and I think the project happened around, my goodness, about six months ago. And we said, you know, let's try something because people don't really have all day to hear about financial tips nor do they have the interest to learn about financial tips every day. What if we made these tips no longer than 90 seconds? Would they listen? So the videos themselves are every single day on LinkedIn and they're 90 seconds. And so if you literally just watch the videos, you'll get one really meaningful financial tip every single day. And we did that every day for I think almost six months and we plan to actually continue it even more so into the new year. A lot of people have been asking us to go Saturday and Sunday which we don't go right now.

Bobbi Rebell:
Oh, my gosh.

Winnie Sun:
But I think we're going to do that. I think we're going to be that crazy.

Bobbi Rebell:
Well, I am blown away by all of this. I love seeing you on so many different media outlets. Tell us more about where else besides LinkedIn people can find you, follow you, and learn more about you.

Winnie Sun:
Well, thank you. Well, you can get free follow me on Forbes. I've been writing, contributing to them for about five years now. I do a lot of work with CMBC and I'm the regular money person on Good Day LA for those of you who are in California. But otherwise, join me on Twitter. I have actually the largest financial tweet chat every single Wednesday and we cover not only financial things but entrepreneur topic, social media marketing, all that fun stuff to give you chance to really increase what you carry in your wallet.

Bobbi Rebell:
Love it all. Thank you, Winnie.

Winnie Sun:
Thank you.

Bobbi Rebell:
Hey everyone. Love ending on such a positive note. Financial Grownup tip number one. Family sticks together. Yes, Winnie was absolutely frustrated and with good reason at how the financing for her college education fell apart. But her parents clearly love her very much and your tone of both forgiveness and being there for them when they needed her sets such a great example. Sure, things are simpler and more traditional when parents are helping their kids financially, but that doesn't preclude the value of having generations helping each other out if that's the way that things evolved.

Bobbi Rebell:
Financial Grownup tip number two. Points tied to travel. Whether it is airlines or hotels have become a currency. Winnie likes to use her points for airplane tickets and upgrades but the possibilities are endless. In theory, we should all use that for what we get the most bang for our buck as but sometimes, there are other uses that just make sense, that just actually save us from spending actual cash. For example, this holiday season, if you have a lot of points, maybe consider buying gift cards for your favorite stores. Now, some stores within the credit card offers, some cards even run specials where you get more points than usual for certain designated retailers.

Bobbi Rebell:
So look for that. Look for the one and they're usually in market where it's normally let's say 20,000 points per this dollar amount but right now, it's going to be 25,000 points, whatever it may be. Then you could use those gift cards to buy presents for the holidays for your friends and family and not spend actual cash and certainly avoid running up credit card bills that you can't afford to pay or just kind of would rather not have. How about that one?

Bobbi Rebell:
All right. Thank you all for supporting the show. Please invite your friends to join us as well and [inaudible 00:14:14] your favorite ways to use your points. Instagram is Bobbi Rebell one, Twitter Bobbi Rebell, and you can always email us at hello@financialgrownup.com. And, of course, thank you to Winnie Sun for helping us all get one step closer to being Financial Grownups.

Bobbi Rebell:
Financial Grownup with Bobbi Rebell is edited and produced by Steve Steward and is a BRK Media production.

Tom Corley grew up in financial turmoil but after studying the wealthy was able to copy their habits and make his money dreams into a reality. 

In Tom’s money story you will learn:

-How Tom’s childhood money disappointments created poor money habits in his early adulthood

-The specific things Tom’s parents did that created financial instability for Tom and his siblings

-Why his graduation party was cancelled because of his parents’ financial troubles

-How he was unable buy a car and to rent an apartment as a young adult again, because of his parents financial needs

-The emotional component of his financial challenges early in his life

-How a client inspired him to do the research that became “Rich Habits"

In Tom’s money lesson you will learn:

-The impact of your parents money habits on your own money habits

-The importance of avoiding “want spending" driven by envy

-How you can change those habits

-Why changing only two or three habits can change your life

-Tom’s habit that he does every day on his way to work to re-inforce gratitude

In Tom’s every day money tip

-Why successful people keep track of other people’s birthdays

-How calling them on their birthday makes a meaningful impact

-Why to avoid the birthday wish on social media

-The connection between the Happy Birthday habit and why it will help you prosper through genuine friendships

 

In My Take you will learn:

-How to move past parents who have poor money habits

-The advice Tony Robbins offers to people who get a rough start in life, as he did

-How my new friend Ramit Sethi uses birthdays as a way to connect with friends and get "Birthday Wisdom"

Episode Links:

Tom’s website: www.richhabits.net

Follow Tom!

Twitter: @RichHabits

Facebook https://www.facebook.com/thomas.c.corley.3

Learn more about Rich Neighbor, Poor Neighbor

 

Get Tom’s books including "Rich Habits, Poor Habits" and "Change Your Habits, Change Your Life” and “Rich Kids"

 

Tom is also writing a book called “The Other Side of Cancer”. Learn more about the Ashely Lauren Foundation which helps families struggling with pediatric cancer. 

 

Also mentioned in the episode:

Tony Robbins

David Bach

Ramit Sethi

 

More about Tom Corley: 

CBS Nightly News Interview: http://richhabits.net/cbs-news-rich-habits-interview-with-lisa-hughes/

Dave Ramsey Interview:http://richhabits.net/dave-ramsey-rich-habits-tom-corley/ 

SUCCESS Magazine Interviews: http://shar.es/1HKwDe      http://shar.es/1HK95w

USA Today Article: http://www.usatoday.com/story/money/personalfinance/2015/02/22/credit-dotcom-credit-card-habits/23545023/ 

 

Tom Corley is an internationally recognized authority on habits and wealth creation.

Tom has spoken alongside Richard Branson, Robin Sharma, Dr. Daniel Amen and many other notable speakers.

In Tom’s five-year study of the rich and poor he identified over 300 daily habits that separated the “haves” from the “have nots.” Tom is s bestselling author and award winning author. His books include: Rich Habits, Rich Kids and Change Your Habits Change Your Life and Rich Habits Poor Habits.

Tom has appeared on or in CBS Evening News, The Dave Ramsey Show, CNN, MSN Money, USA Today, the Huffington Post, Marketplace Money SUCCESS Magazine, Inc. Magazine, Money Magazine, Kiplinger’s Personal Finance Magazine, Fast Company Magazine, Epoca Magazine (Brazil’s largest weekly) and thousands of other media outlets in the U.S. and 25 other countries. Tom is a frequent contributor to Business Insider, CNBC, SUCCESS Magazine and Credit.com.

Tom is also a CPA, CFP and holds a Master’s Degree in Taxation and heads a top financial firm in New Jersey

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Transcription

Tom Corley:
I told all my friends that I'm having a graduation party, I told them the date, and a couple of weeks before the party date I just let my mother know, and she said, "We can't have a party, we don't have any money." I said, "Yeah, I know, I saved $200." That night my father came into my room and he said, "You know what, I hate to do this to you, but we need the money."

Bobbi Rebell:
You're listening to Financial Grownup, with me, certified financial planner, Bobbi Rebell, author of How To Be a Financial Grownup, and you know what? Being a grownup is really hard, especially when it comes to money. But it's okay, we're going to get there together. I'm going to bring you one money story from a financial grownup, one lesson, and then my faith on how you can make it your own. We got this.

Bobbi Rebell:
Hey, friends, if you feel a big knot in your stomach from that clip you just heard from our guest today, I'm right there with you, this was a tough one. But it's also an important story, so I hope you stick with us. Welcome, everyone. As our regular listeners know, while we try to keep the mood light, we also get real here on the Financial Grownup podcast, and we listen and we learn from others' experiences. So my guests are brave and they reveal very personal financial stories sometimes, in the hopes that it will make your lives better, our lives better.

Bobbi Rebell:
Tom Corley is the author of a number of bestselling books including Rich Habits, and it was inspired by his devastating childhood experiences, but also how you can change your habits and have financial freedom. This really goes to the heart of what we try to do here. Here is Tom Corley.

Bobbi Rebell:
Hey, Tom Corley, you are our financial grownup, welcome to the podcast.

Tom Corley:
Hi, Bobbi, thanks for having me on, I appreciate it.

Bobbi Rebell:
I'm so excited to have you because you are the author of Rich Habits, and we all need to develop rich habits for sure.

Tom Corley:
Yeah, I spent five years doing research on the daily habits of rich people and poor people, gathered three hundred and forty something data points, and decided to incorporate some of them, the most important keystone habits, into my book Rich Habits, which has become very popular around the world.

Bobbi Rebell:
Well, you're being very modest, it's been a huge bestseller, and you've been on everything from Dave Ramsey to the CBS Evening News, literally you've been all over the place, and I know that the book has helped so many people, so thank you for that. Also I'm going to thank you in advance for sharing what's a very sensitive money story having to do with your upbringing and the poor habits that you learned from your father. Tell us more.

Tom Corley:
Yeah, so I actually have two stories that I'll try and be as concise as possible. So you know, we were rich and then we were poor. My father's business went under when I was aged nine, it's a complicated story, but it was really random bad luck. Anyway, from the age of nine until, I guess, I left the house, we were poor.

Bobbi Rebell:
And you had a big household, by the way.

Tom Corley:
We had 11 in our family, so we were constantly worried. Our home was in foreclosure, as least as far as I can remember, four times. So we were worried about being homeless. I remember I used to shovel snow and mow lawns, and I spent the whole year doing that, saved money, saved $200, because in the 8th grade I wanted to have a graduation party. I told all my friends who I wanted to come that I'm having a graduation party. I told them the date. A couple of weeks before the party date, I just my mother know, just to make sure it was okay, and she said, "We can't have a party, we don't have any money." I said, "Yeah, I know. I saved $200." Well, that night my father came into my room and he said, "You know what, I hate to do this to you, but we need the money, because I have bills that I have to pay or they'll shut off my electricity, our phones, or whatever." So I handed him the money.

Tom Corley:
The second story was when I was 23 and I had just been working for about a year. I was still living at home, but I was trying to get ready to leave home. So I saved about $5,000, I wanted to buy a car, and use whatever was left to put down on a rental, an apartment somewhere. Somebody in my family found out about it, and my father approached me a couple of days later and said, "You know, we need that $5,000 to pay our real estate taxes. They're in the process of foreclosing on our house again." So I had to give up that $5,000.

Tom Corley:
So what I learned from those two experiences, which were very emotional experiences to me, was, don't save, if you save, somebody will take it. I was young when I learned those lessons, so they stayed with me in my adult life. And it wasn't until really I did my Rich Habits research that I realized I had this horrific poor habit of not saving, and it was emotion based, which most habits are.

Bobbi Rebell:
What even started the idea of doing Rich Habits research?

Tom Corley:
When I took over my CPA firm here from my predecessor, I had a small business client in the auto body business, he had inherited the business from his father and over the course of 20 years he found himself with cashflow issues. He asked me, "What are your successful clients doing that I'm not doing?" Then he started crying because he couldn't make payroll that week, and basically he was going out of business.

Tom Corley:
So I started doing research, I couldn't find anything other than The Millionaire Next Door, that didn't help me really, it wasn't specific enough. So I said, "You know what? I'm going to do my own research." I interviewed 361 rich people and poor people, find out what the rich do and what the poor do, and I didn't know I was doing a habit study, I just was trying to uncover the truth, why are some people rich and why are some people poor? What I wanted to do, Bobbi, was find out what they did from the minute they put their feet on the floor in the morning to the minute they put their head on the pillow at night. So that's kind of what started me on that research.

Bobbi Rebell:
Did you talk to your dad about this at all?

Tom Corley:
No. My dad passed away in 2013, and he was always one of my biggest cheerleaders, but we never really saw eye to eye on a lot of things. I did everything a good son is supposed to do to help my father, and he loved me, you know, we just didn't have that kind of relationship.

Bobbi Rebell:
You never talked to him about your feelings when the money was taken from you after saving it?

Tom Corley:
No. I couldn't do that to him. I know, he was older, why burden him with that? I just felt, this is something that I don't ever want him to know about.

Bobbi Rebell:
For our listeners, what is the takeaway from your story?

Tom Corley:
Well, the takeaway is this: I was able to turn things around, thanks to my Rich Habits research, I started saving, started putting money into my 401(k), and other things. Whether you are aware of it or not, you have certain good habits and bad habits, I call them rich habits and poor habits, that are the result of your upbringing. They primarily are from your parents. So if you are, like I was, not saving any money, and maybe have debt, credit card debt, there's a very good likelihood that that has something to do with your upbringing, and some habits that you forged in your childhood that stayed with you in your adult life. The good news is that I'm evidence you can change your habits, and not only am I evidence, I have 177 self-made millionaires that are proof that once you change your habits, you change your life.

Tom Corley:
So there's light at the end of the tunnel here for anyone, doesn't matter if you're poor or stuck in the middle class. You can change your habits, and it only takes two or three habits to change your life.

Bobbi Rebell:
So give us some habits.

Tom Corley:
So many people struggle with savings, right? If you really peel that onion, what's the reason why they just can't save? In many cases, especially in America, it's the keeping up with the Jones's mindset, it's, my friend bought a BMW, or leased a BMW, my other friend, or someone I know, or colleague just got a really nice house. So you supersize your life. I call it want spending. What drives want spending is envy. Envy is a negative emotion. What shuts down the want spending is turning the fuel off for your want spending, which is turning off your envy. How do you do that? You shift your mindset from negative to positive by, instead of being envious, be grateful for what you have.

Tom Corley:
What I do every day, every morning on my commute to work, is, I sit in my car as I'm driving and I say, "What are three things that went right yesterday with my life, that I'm grateful for?" I spend about 10 minutes thinking about it and going over it. It's an amazing thing, Bobbi, but it completely makes you positive. Gratitude is the gateway to positivity, it's a domino effect. So it's not just, "Oh, all of a sudden I have this gratitude, positive mental outlook." You have a completely changed mental outlook, everything, you start seeing the glass half full, you start seeing the good in life, the good in people. It's amazing when you start treating people as valuable instead of finding the flaws and the faults in them, they respond, and next thing you know you've got these powerful relationships with people that you didn't have before, all because of a shift in your mindset.

Bobbi Rebell:
Tom, for your everyday money tip, I think you're going to win the most original, and should I just wish you a happy birthday even though I don't even know when your birthday is, but I just want to say happy birthday.

Tom Corley:
Thank you, Bobbi, I appreciate that. It wasn't long ago, June 12th. The happy birthday call was one of the things that I uncovered that the self-made millionaires did. All you do is just call people, you don't tweet them, you don't Facebook them, no social media interaction here, you're calling them on the phone, just to wish them a happy birthday. The amazing thing is, when you call somebody on their birthday, guess what, you're going to probably be one of three or four phone calls that they receive. Here's the really cool thing, Bobbi, I found, because I've been tracking this since I uncovered it in 2007, 25% of the people that you call on your birthday will reciprocate, so it's called the reciprocal happy birthday call, that really takes your relationship off life support, takes it to another level.

Bobbi Rebell:
And especially, you mentioned, not social media and that kind of thing, taking it in a different medium really differentiates you.

Tom Corley:
Yeah, look, you want to stand out. If you're going to just be saying "happy birthday" on Facebook, you don't stand out, because the herd is doing that. You want to step outside the herd. What do people outside the herd do? They make happy birthday calls. It's going to emotionalize your relationship. Why is that important to making money? Because the people that really help you open doors, they might be on board of directors with you on nonprofits, they might be other successful people, well, these are the people you want to be making the happy birthday calls to, they're going to remember you, it's going to improve your relationship, strengthen it, and now you're going to start to develop friendships with these people.

Bobbi Rebell:
Love it. Tell us more about what you're up to this summer and into fall, and where people can learn more about you, Tom.

Tom Corley:
Sure. So I've got a book, Rich Neighbor, Poor Neighbor, that I'm just about wrapping up. I'm going to be traveling to Vietnam for a couple of speaking engagements. I'm also going to start work on a book called The Other Side of Cancer. So I've got a few things in the pipeline this summer.

Bobbi Rebell:
What prompted that, Tom?

Tom Corley:
I'm the president of The Ashley Lauren Foundation. We help families who are struggling with pediatric cancer. So if you found out your child had cancer, we step in to help you financially, emotionally, all different sorts of things. We've bailed people out where they were almost homeless because cancer costs money to fight that fight. We've kept people in their homes just by paying their mortgage and paying their rent. So growing up poor, that means a lot to me, because we didn't really have anybody to help us, so I'm going to write a book and proceeds are going to go to The Ashley Lauren Foundation, and it's going to be an upbeat book about how some of the kids who survived cancer went on to become doctors, lawyers, and other things.

Bobbi Rebell:
All right, well keep us posted on that, and I'll make sure to have you send me some links that we can put in the show notes, and people can learn more about it. Thank you so much, Tom.

Tom Corley:
Thank you, Bobbi, I appreciate it.

Bobbi Rebell:
So, can't thank Tom enough for sharing such a candid and raw story. I truly hope none of you have had to go through that kind of, not just financial devastation, but the toll that it takes on the relationship with your parents and how you view them and how you relate to them.

Bobbi Rebell:
Financial Grownup tip number one: as much as our parents set the foundation for our financial perspectives, if you get a bad deal, like Tom, you can move past it. In addition to Tom's books, there are other resources to check out. As our regulars know, I'm a big fan, for example, of Tony Robbins, who was kind enough to support my book, How To Be a Financial Grownup, by contributing the foreword. Tony is a big believer in owning your own situation. Whatever happened in the past with your parents, in your childhood, whatever, look forward, you're an adult, be a financial grownup, and move past anything your parents may have done that you feel hurt you financially. Almost all our parents are well intentioned and really do try their best. Maybe try to teach them what you learn places like here, and from Tom Horley or from Tony Robbins.

Bobbi Rebell:
Financial Grownup tip number two: let's talk about those birthday wishes. I recently met Ramit Sethi at a dinner party that he co-hosted with my friend, David [Bock 00:13:50], Episode 1, by the way, guys, if you want to go back. You guys may know Ramit as the author of the book, I Can Teach You To Be Rich. So I follow him now on social media. It was recently Ramit's birthday, and he said that when his friends have birthdays he reaches out, and he asks them to share birthday wisdom with him. So maybe that's something that we can all do when we reach out and call them, as Tom suggested.

Bobbi Rebell:
Thanks to all of you for joining us. This was an emotional one, but that's okay, it was also honest. If you have not, please hit that subscribe button, and follow us on social media, on Twitter @BobbiRebell, and on Instagram @BobbiRebell1. Thanks to Tom Corley for helping us all get one step closer to being financial grownups.

Bobbi Rebell:
Financial Grownup with Bobbi Rebell is edited and produced by Steve Stewart, and is a BRK Media production.

Andy Hill was so in love with his then future wife that he literally used his student loan money to buy her the ring she wanted- and oops did not tell her. He shares what happened when she did find out, and what he would do differently now that he is a financial grownup. Bonus: His tips on how to start a 529 account for your kids.

In Andy’s money story you will learn:

-The big mistake Andy made with his student loan

-The emotional backdrop to that mistake

-Why Andy did not talk to his girlfriend (now wife) about the decision

-His biggest regrets and what he would do differently

In Andy’s money lesson you will learn:

-The options Andy wish he had considered

-His advice on the best ways to communicate about money in a relationship

In Andy’s everyday money tip you will learn:

-HIs take on 529 plans and how he did his research

-The factors to consider in choosing a 529 plan

-Why Andy chose his plan for his children’s college savings

In my take you will learn:

-How to plan for expenses related to life events, like getting married!

-The cost of not just engagement rings, but weddings as well

-Recent changes to how 529 plans can be used

-Resources to get more information about 529 plans

Episode Links

Andy’s website:

Marriagekidsandmoney.com

Get Andy’s e-book : Young family wealth playbook

Listen to Andy’s podcast! 

Follow Andy!!

Twitter @andyhillmkm

Instagram: @AndyHill 827

Facebook @andyhillMKM

 

Learn more about 529’s: 

Link to the SEC website:

https://www.sec.gov/reportspubs/investor-publications/investorpubsintro529htm.html

Link to the FINRA website Saving for College

http://www.finra.org/investors/saving-college

College Savings Plans Network

http://www.collegesavings.org/

SAVING FOR COLLEGE

https://www.savingforcollege.com/intro-to-529s/what-is-a-529-plan

---

Transcription

Andy Hill:
I took advantage of these student loans that I was using for my MBA program at the time, and just took a little bit extra from my student loans in order to pay for my wife's engagement ring. That's kind of how I started off my marriage with a little bit of debt, also with a little bit of love, as well.

Bobbi Rebell:
You're listening to Financial Grownup with me, certified financial planner, Bobbi Rebell, author of How To Be A Financial Grownup, and you know what? Being a grownup is really hard, especially when it comes to money. But it's okay, we're gonna get there together. I'm gonna bring you one money story from a financial grownup, one lesson, and then my take on how you can make it your own. We got this.

Bobbi Rebell:
Hey friends, they say love is blind. That was certainly true for our guest today. Before we get to him, quick welcome to everyone, especially our new folks, we keep the episodes, just so you know, to around 15 minutes. You can fit it easily into your busy schedule while you're running errands and so on.

Bobbi Rebell:
A lot of regulars, though, say they enjoy listening to a few at a time, especially if they are commuting. The idea, do what works for you. You get to hear an inspiring, and hopefully entertaining money story, and then get some specific advice, money tips, things that you could do right away.

Bobbi Rebell:
Today's story is definitely entertaining, heartwarming, but you also might get that sinking feeling in your stomach, like, "Oh, no! He did not!" We've all been there, so into our loved ones that we just want to get them exactly what they want. Budgets, whatever, we find the money, even if we find it in our student loans? Yes, I'm talking to you, Andy.

Bobbi Rebell:
Let's roll the interview.

Bobbi Rebell:
Hey, Andy Hill, you're a financial grownup, welcome to the podcast.

Andy Hill:
Thanks so much for having me, Bobbi.

Bobbi Rebell:
Congratulations on the success of your podcast, marriage, kids, and money. Nominated for the most important podcast awards that there are, the 2017 Plutus Awards. You were nominated for best new personal finance podcast, so congratulations!

Andy Hill:
Thank you so much, yeah. It was a great honor, and look forward to keep on bringing exciting material for all those people out there who are married with kids that love talking about money, or just want to give their families a better opportunity in the future.

Bobbi Rebell:
Well, I am a hopeless romantic, in addition to focusing on money, and you brought with you a money story that is both romantic and financial, having to do with your engagement. Tell us what happened.

Andy Hill:
Yeah, so back in, oh, this is maybe in my mid-twenties, I met an incredible girl named Nicole and fell in love with her. When you fall in love and you start to see the opportunity for marriage coming up, the first you think of, as a guy is, "Man, I got to get this ring thing going."

Andy Hill:
Me, not making that much money at the time, was probably making $35,000 a year, I said, "Well, I better start saving a little bit of money to make this thing happen." Unfortunately, since we were dating long distance from California to Michigan, my bank account was a little light, we'll say, but my love for her was continuing to grow. I know I had to take advantage of this moment and go for this engagement.

Andy Hill:
We looked at rings together at the store, and we found the ring that she liked, with the type of the style, I found out it was about $5,000.

Bobbi Rebell:
Ouch!

Andy Hill:
Yeah. That was about $4,500 more than I had.

Bobbi Rebell:
Okay.

Andy Hill:
I decided to go for it anyway because I was in love, and I wanted to move this thing forward. The way that I went about it was I took advantage of these student loans that I was using for my MBA program at the time, and just took a little bit extra from my student loans in order to pay for my wife's engagement ring. That's kind of how I started off my marriage with a little bit of debt, also with a little bit of love, as well.

Bobbi Rebell:
Oh my goodness. That is such a big no-no though. Let me just ask you, taking it back a little, did it occur to you to either wait and save up more, or maybe downsize the ring a little bit, or find ... I don't know if that was maybe the best interest rate you could get on student loans versus taking out a different kind of loan. It's certainly better than a credit card, we know that.

Bobbi Rebell:
Any other considerations at the time?

Andy Hill:
Oh yeah, Bobbi. All these things I could've done better. Could've gotten a better opportunity to get a lower interest rate than ... I think it was 6.8% that I was paying for my student loans. I could've maybe spoken to my wife ... my future wife about it a little bit about the- [inaudible 00:04:43][crosstalk 00:04:43]

Bobbi Rebell:
So, she didn't know about this, she did not know that you went into debt to get her ring.

Andy Hill:
Nope.

Bobbi Rebell:
What would she have said if she knew?

Andy Hill:
I believe that she would've said, "That's not a good idea. We can either wait, or we can look at something that's a little bit more feasible for your actual budget."

Bobbi Rebell:
Okay, but you did not talk to her, so that's also a lesson. Just to point out. That's one of the things you talk about a lot on your podcast, is the communication aspect.

Andy Hill:
Absolutely. I preach about it all day long, but did I do it back in my mid-twenties? No. I did not. Definitely having communication with your spouse, or your future spouse is an incredible way to start the marriage, and I definitely did not do that.

Bobbi Rebell:
If you can get into the mind of 27-year-old Andy, what were you thinking at the time?

Andy Hill:
What I was thinking was, "I'm in love, and I want to make this thing happen as soon as possible. She's shown me the type of ring that she wants, and I want to make her happy." Unfortunately, I didn't think about any of the other consequences that went along with that: the interest rate, not speaking to my future wife about something that's super important. That could've been a really pivotal moment for us, actually, to speak about something that important, and I passed it up, for sure.

Bobbi Rebell:
When did she find out? Assuming it's not now, listening to this podcast? When did she find out when you had done that?

Andy Hill:
She found out about the debt that I had, as well as the ring situation a little after we got married when-

Bobbi Rebell:
Whoa, whoa, whoa, wait. The debt you had in addition to the ring. What was the other debt you had? You had $4,500 from the ring, and then what else?

Andy Hill:
It was all these student loans that I had, it was about $40,000 of student loans total, as well as a home equity line of credit, which probably equated to another $10,000, so about $50,000.

Bobbi Rebell:
Okay, go on.

Andy Hill:
Yeah, yeah, so we got married, and then with that comes the merging of the finances, right? As we were merging finances we started to have the conversations then about what my debt situation was, and what her debt situation was, and then it became our problem, and something that we worked on together, but she didn't realize until then, "Oh, so I'm now paying off the ring that you bought for me."

Bobbi Rebell:
"I'm paying off my own engagement ring. Thank you very much."

Andy Hill:
How romantic, right?

Bobbi Rebell:
That's so romantic. No. No, no, no, no. Quickly tell us how did it resolve? How did you pay all that off?

Andy Hill:
Well, yeah, so we got together and we made a plan to pay it off. We started to talk about potentially having kids in the future, and we said, "Hey, well, let's work together and pay this off." Combined we were making a little bit over six figures in a salary. We said, "All right, let's live on half, and pay this off as fast as possible," and we were able to clobber it in about 12 months.

Bobbi Rebell:
What is the lesson for our listeners from that now that you're a wise, wise old man in your thirties?

Andy Hill:
Yeah, I would say communication as early as possible in your relationship, especially when it comes to money is so important. The opportunity that I did not take advantage of was to speak to my future wife about, "Hey, this ring that you want, I love it, you love it, it would make you feel great, but I just don't have the money right now in order to make this happen. We can either delay our marriage in order to get the ring, or we can look at something that's a little bit more feasible."

Andy Hill:
That would've been a very good financial grownup conversation to have with her at that point in our marriage, for sure. Communication and just working on things as a married couple before you're even married shows the true partnership before you get into it.

Bobbi Rebell:
I love the money tip that you're going to share, because we kind of moved things forward now to the mindset of being parents, which you now are. You have two children, ages six and four. That means time to think about college and getting ready. It's never too early. Tell us your money tip.

Andy Hill:
Absolutely. When we got married we decided to have children, and one of the things as we started to get our financial grownup selves together was, "Hey, if we're gonna be helping our kids get through college we got to start saving now."

Andy Hill:
We started researching 529 programs, and the cool thing about 529 programs is that you don't have to take advantage of the one that's specifically in your state. There are other programs that maybe have lower fees to consider. We did a broad research of all the programs that were available to us in the U.S.

Andy Hill:
We ended up going with our state, because it had good fees, or lower fees, through TIAA-CREF, and actually, there was a great state income tax break, as well, that helps us save a little bit of money each year as we donate into ... as we contribute into our kids' college fund.

Andy Hill:
I guess my tip would be, take a look at all the opportunities that you have to save for your kids through a 529 program, start as early as possible, but definitely take a look at the fees that are associated with it, because some of the programs might have higher fees, and they might not even be in your state.

Andy Hill:
Taking a look at that, as well as getting an understanding of the tax advantages of utilizing a 529 with your state. It's a great way to save, and it's a great way to prepare for the future college costs that we're all looking for as parents.

Bobbi Rebell:
Definitely, and I also want to just ask you quickly before we wrap up about your E-book.

Andy Hill:
Yes, have a E-book on my site called The Young Family Wealth Playbook. It is an amalgamation of all these interviews that I've done on my podcast from the 50+ self-made millionaires, financial independent rock stars, and personal finance experts, and I've taken all that information that will help individuals who are reading it to look at what they can do, all the way from the start of marriage, all the way to being parents and helping your family to build wealth.

Andy Hill:
It's seven steps that I've taken from those conversations, and it'll walk people through how they can grow wealth and create a great future for their family.

Bobbi Rebell:
So cool. Tell us where people can find you, social handles, all that good stuff.

Andy Hill:
Excellent, yeah, so I'm at marriagekidsandmoney.com. On that site you'll be able to check out the podcast, The Young Family Wealth Playbook, as well as my blog. I'm also very busy on Twitter: @andyhillmkm. I'd love to have some conversations, and thanks for checking it out.

Bobbi Rebell:
Thank you so much, Andy.

Andy Hill:
Excellent. Thanks so much, Bobbi.

Bobbi Rebell:
Oh, Andy. We can't help but be charmed by you, even though I can't believe you did that. So glad you clearly are a financial grownup now, and even more happy that your wife is still there with you.

Bobbi Rebell:
Financial grownup tip number one: remember, the ring is just the beginning of the cost of your trip down the aisle, so if you blow your budget on that, oh my goodness. According The Knot, Americans spend an average of $6,351 on just the wedding ring.

Bobbi Rebell:
In Andy's case, given that he got married a few years ago, Andy was relatively in line at the $5,000 mark. If you want to stretch for that, that's fine, but you got to keep in mind what's coming next. The wedding. The average cost of a wedding, according to The Knot, again, is over $33,000, and, of course, in New York City, couples spend even more, almost $77,000, so that's a choice. But, think about it, if you are going to spend that kind of cash, make those decisions as a couple. Andy admits he messed up by not talking to his wife.

Bobbi Rebell:
Financial grownup tip number two: 529s are a great resource for parents, and if you are sending kids to private school, you now can use them for that, as well, but there are a lot of rules, and you need to play by those rules, or you're gonna get stuck. You're gonna pay higher fees than needed, as Andy warned, you also may have penalties if you try to get the money in a non-qualified way.

Bobbi Rebell:
I will leave a link to the sec.gov website that has a very easy and straightforward explainer article. Read it. I'm gonna leave some other helpful links, as well. You need to do your homework on this, because you may not be able to get to the money in the way you want, when you want, without the penalties, so just do it with your eyes open.

Bobbi Rebell:
Thanks to everyone for joining us. If you like the promo videos that you are seeing on social media you can win one. Just share them in social media when you see them. I'll be making one for a lucky winner in July, basically based on whoever shares the most.

Bobbi Rebell:
To learn more about the show go to bobbirebell.com/financialgrownuppodcast, and, of course, stay in touch by following me on Twitter: @bobbirebell, on Instagram: @bobbirebell1.

Bobbi Rebell:
Andy, you truly became a financial grownup by learning your lesson. Glad it all worked out for you and the wife, and now your children. Thank you for helping us all get once step closer to being financial grownups.

Bobbi Rebell:
Financial grownup with Bobbi Rebell is edited and produced by Steve Stewart, and is a BRK Media production.

Award-winning CBS Business News Analyst, and radio and podcast host Jill Schlesinger CFP® talks about how she literally paid off her ex-husband to go away, after just one year of marriage. She also shares her best tip for organizing and tracking spending. 

In Jill’s money story you will learn:

-The negotiation that went on during her divorce

-The advice her father gave  her and the significance of his perspective

-The financial- and other- costs of marrying the wrong person

 

In Jill’s money lesson you will learn:

-The value of using money and financial resources to move on, even when it is not a fair payment

-How Jill’s background as a trader gave her perspective on cutting her losses in bad situations. 

-How to apply Jill’s lessons to different situations in life, from stocks, to high living expenses

 

In Jill’s money tip you will learn:

-Her advice to cut transportation and commuting costs

-Don’t sweat the small stuff but pay attention to the big stuff like life insurance

-Keep your finances simple, for example charge on just one credit card

-About the book Jill is writing “Dumb Things Smart People Do with Their Money” including a sneak peak!

 

In My Take you will learn:

-Ways to apply Jill’s philosophy of cutting your losses, including stocks, business partnerships and consumer goods

-How to know what to insure

-Specifically how I just was able to get a 44% price cut on my annual home insurance

 

Episode Links

Learn more about Jill at https://www.jillonmoney.com/

Check out the Better Off Podcast

Follow Jill!

Twitter: @jillonmoney

Facebook Jill On Money

Instagram: @jillonmoney

Linkedin JillonMoney

YouTube Jill Schlesinger

---

Transcription

Jill Schlesinge:
He asked for a number that I thought was ridiculous. I countered with a number that he thought was ridiculous. We agreed on a number that we both thought was unfair, which probably meant it was a good deal for both of us.

Jill Schlesinge:
I wasn't paying him, I was paying for my freedom.

Bobbi Rebell:
You're listening to Financial Grownup with me, certified financial planner, Bobbi Rebell, author of How To Be a Financial Grownup, and you know what? Being a grownup is really hard, especially when it comes to money. But it's okay, we're gonna get there together. I'm gonna bring you one money story from a financial grownup, one lesson, and then my take on how you can make it your own. We got this.

Bobbi Rebell:
Hey friends, do you ever wish and imagine that there would be a check big enough to make a problem go away? It could happen. We'll talk more about that soon, but first a quick welcome to our new listeners, and welcome back to our Financial Grownup regulars. Please keep telling your friends about the podcast so we can continue to grow, and if you listen on Apple Podcasts, take just a few minutes to rate and review it. That also helps us get discovered and is really important, and needless to say, much appreciated.

Bobbi Rebell:
Now to our guest, Jill Schlesinger, award-winning journalist for her national radio show, she is also the CBS Business news analyst, and she hosts the Better Off podcast. I met Jill when my book came out. A mutual friend introduced us, and then I was thrilled when I got to be on her award-winning radio program. Did I say award-winning enough? She won a big Gracie award recently.

Bobbi Rebell:
As you guys know, I'm a big believer in learning from the best, and while modest, Jill is way up there with the best in the business, and scores extra points in my book for being a certified financial planner and encouraging my efforts to get the designation as well. But what I did not expect was such a candid conversation with Jill. What she says about how she literally, she bribed, let's say what it is, she bribed someone to get out of her life. It really took me by surprise. She goes there. You guys should listen to this. You're gonna enjoy it. Here is Jill Schlesinger.

Bobbi Rebell:
Hey Jill Schlesinger, you're a financial grownup, welcome to the podcast.

Jill Schlesinge:
Thank you for having me.

Bobbi Rebell:
Big congratulations are in order. You just got back from a very special trip to LA for a very big award. Tell us.

Jill Schlesinge:
Oh, well as you know, I got a Tony award. Just kidding. I got a Grammy award. No, just kidding, I got something called a Gracie. A Gracie, I'm so old I knew exactly who that referred to. That refers to Gracie Allen who was a very strong woman in Hollywood many, many years ago. The Alliance of Women in Media gives out an award for TV, radio, podcasts, and my executive producer Mark and I won for the best national radio show, so we're very psyched.

Bobbi Rebell:
I'm very psyched for you. I am honored that I was once a guest on the show when my book came out. And you even got to walk the red carpet.

Jill Schlesinge:
I know, and that is always sort of a frightening thing for a big, tall woman who does not usually wear heels that are that tall, so that was daunting. That was the hardest part of the whole thing. Give me a spreadsheet to go through, but don't make me walk in heels.

Bobbi Rebell:
All right, so you brought with you a money story. Do tell, Jill.

Jill Schlesinge:
Remember when you were on my radio show and at the end you like completely hijacked me and turned the tables, and you're like-

Bobbi Rebell:
Totally.

Jill Schlesinge:
... "Tell me something."

Bobbi Rebell:
Exactly.

Jill Schlesinge:
So I have a money story that is basically about divorce, and it's kind of both a real divorce, a marriage dissolving, a partnership, a business partnership dissolving, and my story is this. I learned something from my now deceased father when I was talking about my divorce and I was very upset about the whole things. I had really such a schmucky ex-husband who literally threatened to sue me for alimony after being married for a year, a month, and a day.

Bobbi Rebell:
Oh my gosh.

Jill Schlesinge:
Yeah. I hope you're listening. You know who you are. And what I realized very quickly after my father kind of laid it out for me, he's like, "You know what, honey? You worked your butt off on Wall Street, you made a few bucks, you got some money. All this guy wants is for you to pay him off. Pick a number, make him feel like a man..." He put that in sort of italics, "and move on. And the quicker you move on, the quicker you move on for your life, and there's actually no price tag for that freedom."

Jill Schlesinge:
That is a money story that I have brought through my life, which I was able to actually help my clients with 'cause I went into the client business where I was managing money as a certified financial planner. And as soon as you realized you had enough money to sort of write a check, and you realized that it really wasn't the amount, it was just the fact that you would do it, that that became a really important lesson for me.

Jill Schlesinge:
And so my wisdom to impart on you and your listenership is that sometimes, don't worry about who's right or wrong. Just pay and move on.

Bobbi Rebell:
So, you did that, I assume, with your now very long time ago ex-husband. Was it an amount of money that was meaningful to you or was it actually just a small amount that made it go away in principle? I mean, did it hurt financially?

Jill Schlesinge:
No, it did not hurt financially. It hurt from a pride perspective because I felt like I was being punished monetarily for marrying the wrong person for a year. And so it hurt me to even think that I had to put a dime in this guy's pocket after one year of marriage. What I really stopped doing in that ... again, after my dad gave me this really good advice is that I wasn't paying him, I was paying for my freedom, and that's how I made the adjustment.

Bobbi Rebell:
And how did the ex respond? Did he just say, "Great, I'll take the check. Thank you very much. Goodbye." Or was he a jerk about it?

Jill Schlesinge:
Oh man. Well, obviously if you're married to someone for a year and that person is suing you for alimony, the jerkiness is sort of well-documented.

Bobbi Rebell:
True true.

Jill Schlesinge:
But what I could say is this. He asked for a number that I thought was ridiculous. I countered with a number that he thought was ridiculous. We agreed on a number that we both thought was unfair, which probably meant it was a good deal for both of us, that we both kind of moved on.

Jill Schlesinge:
And you know what? He got remarried, I moved on, it kind of did work out. But again, for me the lesson being, there is absolutely no reason to get stuck. For me, I'm the kind of person who could get stuck on it is not the right thing, and that was just not worth it for me. Whether it was right or wrong or someone was right or wrong or whether I was wronged or he felt wronged, it didn't matter. We both had to get out of this thing. We both realized it was over.

Bobbi Rebell:
So for our listeners, I like what you said before about this isn't just about ending a marriage. It could be about ending any kind of partnership. How does this apply ... what is the takeaway for our listeners? What's the lesson here?

Jill Schlesinge:
I was born a trader. That was my first job on Wall Street. I was a commodities trader, and the one beautiful thing about being a trader is that you quickly learn you always have a bad trade. There's nobody who gets to go through life as a trader and not experience the recognition very quickly of, "Oh my god, I'm in a bad trade."

Jill Schlesinge:
So, you're gonna do that in your financial life a million times over. You're gonna realize like, "Uh-oh, bad trade. Like uh-oh, I actually moved into an apartment that is too expensive for me. I am going to pay the two month penalty to get out and move to another apartment." Or, "I'm going to do something different." Or, "I bought something, I bought a stock, I bought a mutual fund, I did something," and you immediately realize you've screwed up. "I bought an insurance policy I don't understand. There's a penalty to get out. Maybe I need to get out."

Jill Schlesinge:
When you feel that recognition in your soul that you've done something that's probably not right for you, if you don't know for sure, go get advice, but do not ignore that feeling.

Bobbi Rebell:
Okay, I am on the edge of my seat. What is your everyday money tip for our listeners.

Jill Schlesinge:
Well I have two different things to just impart for everyday money tips, and this is for anyone who lives in a city. Like, I'm a walker. Just walk everywhere. That is actually how I saved more money than anything. People take cabs all the time. I'm a huge mass transit person. Now, you don't live in a place where there is mass transit, this is irrelevant to you.

Jill Schlesinge:
My other everyday tip is don't sweat the small stuff that you ... you're gonna think that I'm a certified financial planner and I count every single penny I spend. I don't. I've done that, but I know generally how much to spend, and I don't quibble over little things. But I'm very thoughtful about big things. So my everyday money tip is that like, you know, you're worried about whether you get a latte at Starbucks versus making your own coffee, that's not the big decision to sweat. Sweat more about the big decisions like, "Gee, I need to buy life insurance but I haven't yet."

Jill Schlesinge:
So, I really am not a big sweat of the small stuff kind of person. My everyday is to live my life, walk around, know exactly how much money's in my pocket, and I loathe to do anything besides charge on one credit card only. That's it.

Bobbi Rebell:
Keeping it simple. Thank you, Jill. So tell me more about what you're up to post-Gracie award.

Jill Schlesinge:
Well, you know, obviously I have to put those shoes away 'cause I'll never walk in them again.

Bobbi Rebell:
So those are not the shoes you use to walk around Manhattan?

Jill Schlesinge:
No. No, I am a big fan of the Allbirds to get all over Manhattan. So, I host a podcast called Better Off. I host a radio show called Jill on Money. I write a column for Tribune. I am working every day at CBS News, both in radio and TV. And here's the big news that I've just submitted my manuscript for my first book.

Bobbi Rebell:
Wow.

Jill Schlesinge:
So that's dropping next February, so I'll come back on in February when the book drops. How's that?

Bobbi Rebell:
Yes. Absolutely. Oh my gosh, congratulations. You didn't tell me that till just now. I'm so excited for you. Can you tell us just a little more about it?

Jill Schlesinge:
Yes. The tentative title is Dumb Things Smart People Do With Their Money, and it is based on the fact that I have been in the business for so long and I've been around incredibly bright people who consistently shoot themselves in the foot. They mostly do it to themselves, and there are a series, you know, maybe a dozen or so very practical things that you can do to avoid making those dumb mistakes.

Jill Schlesinge:
So, that is ... it's not a book for everyone, but it is definitely a book for someone who has a brain and says, "Why do I keep doing dumb financial things? I have a brain. Why is it that I can't do these things?" And I know that's most of your audience, 'cause smart people listen to people like you, Bobbi.

Bobbi Rebell:
Oh, thank you Jill. And smart people listen to people like you, and I love listening to your podcast and your radio show. So thank you, and I'm looking forward to your book.

Jill Schlesinge:
I am too. Thank you so much for having me.

Bobbi Rebell:
Jill totally delivered, so let's get right into it.

Bobbi Rebell:
Financial Grownup tip number one: Cut your losses and move on. This applies not just to divorce, as was Jill's main example, it also applies to things like investments, like stocks. If a stock that you liked is no longer in your like category, it doesn't have the same criteria that it had when you picked it, get out. Cut your losses. It's okay to take a loss and move on and use that money to buy a different stock that's maybe a better investment that you'd otherwise be missing out on.

Bobbi Rebell:
Business partnerships, not working, not fixable, find a way out. We all want to come out with the win. You're gonna want to have more, especially if you're in an adversarial position with your business partner, but you know what? Sometimes getting out is more important than getting even. So focus on that and make sure that you can get out and move on to something that's gonna make you happier and maybe more money than that business. Maybe you bought something, maybe an electronic device and the store wants to charge you a re-stocking fee, which is so ridiculous. But you know what? If you don't return it and pay that penalty, you're gonna have something that you don't want taking up space in your home, and you won't have the 90% let's say, of the purchase price that you'd be getting back to then buy what you actually do want. So don't dig in your heels. Just get out, get your money back, move on.

Bobbi Rebell:
Financial Grownup tip number two: Jill talked about insurance, which is a really important thing to talk about, a very grownup thing. At least once a year, take a look, assess what you've got, and figure out, are the things that would be really hard to replace if something unexpected happened covered. Things like home insurance, renter's insurance, they usually have under them, personal liability. Those are good things to make sure that you have. You can usually tie them together.

Bobbi Rebell:
And guys, this is a big one. I kind of blew it. I have not been negotiating well with my insurance companies, but I did recently, I went to my homeowner's insurance company, pointed out that I'm a really good customer. I've been with them for years. I don't file claims, which is very fortunate on my part, hopefully that won't change, and I asked them to lower my rate and just said, "I'm gonna start shopping around for a better rate somewhere else." And you know what? Within 24 hours, they came back with a new policy, all the same coverage, but 44% lower in terms of annual premium. So, that was a nice chunk of change on annual homeowner's insurance just for asking. And if that's my hourly rate for spending not even an hour doing that, I'll take it.

Bobbi Rebell:
All right. We just had our first listener episode. To be considered for a future one, email us at info@financialgrownup.com. That's info@financialgrownup.com. Share with us what money story you would like to tell, and the lesson and the everyday money tip that you think our listeners would get value from.

Bobbi Rebell:
And a reminder, you can't win it if you're not in it. If you want a custom video like the promos that we do for the show, join the competition. All you have to do, it's totally free, when you see one of the promo videos for the episodes, just share it. Retweet it on Twitter or share it on Facebook. Everyone keeps DMing me and telling me they'll never win and can they just buy one. You have to try. Guys, you gotta be in it to win it. Just share it and retweet it and repost, and you may surprise yourself and be the winner.

Bobbi Rebell:
Thank you all for being part of our Financial Grownup community. If you enjoy the show, consider leaving a rating or review, and of course, hit the subscribe button and just tell a friend if you're enjoying the show. It means a lot to us.

Bobbi Rebell:
I am on Twitter @BobbiRebell, on Instagram at BobbiRebell1, and on Facebook at Bobbi Rebell.

Bobbi Rebell:
Jill's advice definitely resonated with me. I hope it worked for you as well. We all tend to cling to our previous convictions. We need to move past that. So thank you, Jill, for helping us all get one step closer to being financial grownups.

Bobbi Rebell:
Financial Grownup with Bobbi Rebell is edited and produced by Steve Stewart and is a BRK Media production.

 

Indiana-based radiologist Dr. Scott Steenburg joins the Financial Grownup podcast as our first listener to share a money story. Scott shares the story of how a push to have students take out more money than needed to pay for tuition, created devastating debt situations for classmates.

 

In Scott’s money story you will learn:

-Why Scott was offered more money than needed when taking out student loans

-What Scott used his extra student loan cash to buy, and whether it was a smart financial decision

-The things his fellow students spent their extra student loan money on, and how  that impacted their financial wellbeing.

-How the tech stock bubble impacted many of his peers who were leveraging student loan debt

-How much student loan debt Dr. Streenburg had, and how it compared to his peers

-The strategy he and his peers used when they could not pay the debt, along with the consequences

-Whether or not he believes taking on all the debt was worth it

In Scott’s money lesson you will learn:

-His big regret regarding the debt he incurred while in medical school

-The long-term consequences and impact to his peers that spent student loans for things other than tuition. 

-The risks that medical students take on when assuming large student debt, that is unique to the medical profession.

In Scott’s money tip you will learn:

-How you can get medical school debt forgiven

In My Take you will learn:

-how to find programs that allow you have loans reduced or forgiven

-The requirements needed for student loan forgiveness

-Resources to manage, lower, and get rid of student debt

 

EPISODE LINKS

• Government website links:

  • www.studentloans.gov

  • https://studentaid.ed.gov/sa/repay-loans/forgiveness-cancellation

  • https://studentaid.ed.gov/sa/repay-loans/forgiveness-cancellation/public-service/questions

• Here is the article from Robert Farrington’s The College Investor: 

  • https://thecollegeinvestor.com/578/ways-to-get-student-loan-forgiveness/

• This is the article by Melanie Lockert. 

  • https://studentloanhero.com/featured/the-complete-list-of-student-loan-forgiveness-programs/

• You can also check out Melanie’s episode of Financial Grownup here!

• You can consolidate your student debt, and get  more information by visiting websites, including two that I mention, SoFi.com and StudentLoanHero.com

 

Follow Scott!

Twitter @radiology911

---

Transcription

Scott Steenburg:
Some of my classmates used their excess money to invest in tech stocks. It did not turn out well for them. Some of my classmates lost all of their student loan money in the dot-com bubble.

Bobbi Rebell:
You're listening to Financial Grownup with me, certified financial planner Bobbi Rebell, author of How to Be a Financial Grownup, but you know what? Being a grownup is really hard, especially when it comes to money, but it's okay. We're going to get there together. I'm going to bring you one money story from a financial grownup, one lesson, and then my take on how you can make it your own. We got this.

Bobbi Rebell:
Hey, friends. This is a big episode here at Financial Grownup. We tried an experiment. We asked you guys to send in your money stories and your everyday money saving tips to potentially be a guest here on the show, and you know what? It worked out really well. We have our first listener episode. I am so excited for how it turned out. Our guest is fantastic. He is a radiologist in Indiana, Dr. Scott Steenburg, so let's get to Dr. Scott's story. It is about the loans that he and his medical school classmates racked up years ago.

Bobbi Rebell:
Student debt to pay tuition is one thing, but taking up more than you need to actually pay the tuition, your real school costs, is a whole other thing, and the reality is that in some cases people are talked into taking out more than they need, just in case. But remember, that money is there and sometimes it doesn't get paid back right away. Sometimes it gets invested in, oh, technology stocks that can crash and burn in the dot-com bubble. It could also go to a new car. You'll hear all about it. Here is Dr. Scott Steenburg.

Bobbi Rebell:
Hey, Scott Steenburg. You're a Financial Grownup. Welcome to the podcast.

Scott Steenburg:
Thanks a lot, Bobbi.

Bobbi Rebell:
And congratulations, you are our very first listener that we are having as a guest. You're the winner, so I'm so excited to have you.

Scott Steenburg:
I'm glad to be here.

Bobbi Rebell:
Just quickly, tell us about you, what you do.

Scott Steenburg:
Sure. My name is Scott Steinberg. I am a radiologist in Indiana. A radiologist is a physician who specializes in interpretation of medical images such as X-ray, CAT scan, and MRI, and my subspecialty is in the emergency and trauma radiology world.

Bobbi Rebell:
Wow. What made you decide to write in?

Scott Steenburg:
Well, I've been listening to your podcast since the very beginning. A lot of your stories that you have on your podcast are very compelling, and when I heard that you wanted to have a listener on with a compelling story, I thought, "You know, there are some really weird things about the student loan industry," particularly with respect to medical school that I thought maybe this might be something that you haven't heard of before, so I reached out to you and told you some interesting nuggets about that.

Bobbi Rebell:
Which brings us to your story, which is very interesting, especially because it has to do with your student loans, but also money that you didn't necessarily use for tuition, so tell us exactly what happened.

Scott Steenburg:
Sure. As you probably know, medical school is not cheap, so most medical students need to finance their education with student loans. At that time when I started medical in 1999, it was really easy to get a lot of loans for all four years of medical school.

Bobbi Rebell:
And how much did four years of medical school cost at the time?

Scott Steenburg:
At the time tuition, I went to an instate school, it was maybe 9,000 per semester, so 18 to 20,000 per year, which is not a whole lot by today's standards.

Bobbi Rebell:
Okay, so go on. You were able to get financing, though, to go to school?

Scott Steenburg:
Yes, so during the interview process, you interview for getting into the medical school, and then in the afternoon you meet with a financial aid counselor to figure out how you're going to pay for medical school. At that time, I'm not sure if it's commonplace now, but at that time we were kind of nudged towards taking out the maximum allowable student loans because in future years, if you lower the amount that you requested, there was no guarantee that you'd be able to increase that number in the future, so we were kind of nudged towards just take up the maximum, and if you have access leftover you can do whatever you want with it.

Bobbi Rebell:
Okay, so how much did you take out relative to what the tuition was? You took out more than the tuition.

Scott Steenburg:
Yeah, so as a medical student it's hard to have a job to help pay for living expenses, so a lot of medical students will finance not only their tuition, but also living expenses such as food and rent and whatnot.

Bobbi Rebell:
What did you use the money for, besides living expenses? You bought a car.

Scott Steenburg:
Yeah, yeah. That's one thing that I told you about. If you have excess student loans, you can do whatever you want with it. You can either pay back immediately, which is the financially responsible thing to do. What I did one semester is I knew I had enough living expenses saved up, I already looked at my budget, I knew I wasn't going to need the student loan check, so I literally, it arrived in the mail and I walked across the street to the bank and put it in a one-year CD. At that time, the interest rate was somewhere just higher than the interest rate for the loan, so I did make a little bit on that, but it would have been smarter just to pay back right away to lower the overall balance. One thing I did in the subsequent years, I needed a new car, my car was falling apart, I needed to be able to commute from my apartment to school, so I used my excess student loan money to buy a new car.

Bobbi Rebell:
Did you need a car? I mean, was that a legit expense, or did you buy a lot more than you really needed?

Scott Steenburg:
We bought what we needed. The good thing about this, if there is a silver lining, is I put 50% down, so there's a small balance, but then I financed the rest at 7%, which was not a great idea, so I'm using the student loan money that has an interest rate at that time of 3.5% to pay off another loan that has 7%, so that was a terrible, terrible choice.

Bobbi Rebell:
Well, but you told me some people did even other things like buying tech stocks.

Scott Steenburg:
Yeah, so this was in 1999 to 2003 when I was in medical school, and some of my classmates used their excess money to invest in tech stocks, and it did not turn out well for them. Some of my classmates lost all of their student loan money in the dot-com bubble.

Bobbi Rebell:
Wow. That's really scary. Let's talk more about you. So, we get to the end of school. Describe to me how much you had in debt and then what was happening at that point.

Scott Steenburg:
Sure, so I graduated in 2003 and immediately started residency, entered a five-year residency in radiology. At that time, the student loan balance was about 130,000 which by today's standards is a fraction of what students are graduating with. I threw out an informal poll to a closed physician Facebook group that I'm a part of, and the numbers I was getting back for current graduates was between 200 and 400,000. So by today's standards my balance was not all that big, and even the minimum payments at that time were somewhat draconian. I was making a resident salary which at that time was about $35,000 per year, and out of that, of course, I needed living expenses, had to pay for a car, had to commute every day, so even the minimum payment was tight.

Scott Steenburg:
So what a lot of students do in this instance is they first defer, and at that point you could defer up to 36 months. I think it might still be that. Then after that, if you still can't make your payments, then you can go into forbearance, which is even worse, so then throughout the entire time the interest is accruing. From the time I started medical school to the time I started paying down my loan, it was nine years, so that was a long time of compounding.

Bobbi Rebell:
So then where did it stand? How did this end up?

Scott Steenburg:
Sure. The balance tipped the scales at about 165,000. I started making very aggressive payments in 2009, and this story turns out okay. I was able to finish paying off those loans last year. Everything turned out okay, and I really don't have any complaints. Taking all these loans helped enable me to realize my dream of becoming a physician and being a radiologist and doing what I love to do, but I live in a world of chaos in the emergency and trauma world, and I see people's lives destroyed every day.

Scott Steenburg:
Nine years of deferral of putting off student loan payments is a long time. That's a long time, and anything could have happened. If I developed an illness, or if I were in a car accident like a lot of the patients I see every day, or if I developed a disability or for some reason couldn't finish residency, that would have been really, really bad. And fortunately everything turned out okay for me, but for a lot of people it doesn't.

Bobbi Rebell:
How did you feel when you would see $165,000 as your balance?

Scott Steenburg:
Honestly, I buried my head in the sand. I didn't want to think about it. When I saw the number going up every month, and each month the amount that it would increase would increase because of compounding, I put it out of sight, out of mind. I kept my eye on the prize of finishing residency, and when I got an attending job, an attending salary, I had to be able to quickly pay it off, but in retrospect, I was entering the danger zone. You know, if something bad happened that negatively impacted my ability to earn income, it may not have turned out so well, and as you know and many of your listeners know, dismissing student loans and bankruptcy is very challenging.

Bobbi Rebell:
Is that something you ever thought about?

Scott Steenburg:
No, no.

Bobbi Rebell:
Okay.

Scott Steenburg:
I knew that once I finished residency and got a job I was going to be able to pay it down. I mean, the number is big and it was moderately terrifying, but once I started seeing that number come down, I started to feel better about it. I regretted having that balanced because I knew I could be taking that money and putting it to good use elsewhere. I did some math. You know, if I didn't have student loans and I used all that money to invest, it was a much bigger return than just taking out the student loans.

Bobbi Rebell:
So what is the takeaway then, for our listeners? When you look back at who you were when you were first entering medical school and having these meetings with the financial aid advisors, what would you have done differently, if anything?

Scott Steenburg:
I probably would have taken the excess money that I didn't need. I would have just paid back the balance and be able to give it back. You can use debt as a tool to accomplish your goals. However, if you're going to use debt to finance an education, you have to be very mindful of that. You need to be conservative, only take out what you need and then pay back as quickly as possible. If you use debt, especially for education, incorrectly and something bad happens that negatively impacts your ability to pay back the loan, that could be financially devastating.

Bobbi Rebell:
What about these people that were ... I mean, was it a popular thing at the time to take your student loan money, and instead of using it for tuition, use it to buy stocks?

Scott Steenburg:
That was one popular thing that students did. Other students would, if they had time off, they would go on a nice vacation. Like, me, I helped buy a car. That's what a lot of the students did, and like me, a lot of them were putting it out of sight, out of mind. All we need to do is finish medical school, go to residency, get an attending job with a higher salary, and pay back the loans quickly. But as I said before, it's a long time from the time you start to the time you end and start making a physician salary to be able to pay that down aggressively, and anything could happen in that time.

Bobbi Rebell:
So what is your money tip now? You have something really innovative that maybe some people don't know about, but could really be helpful.

Scott Steenburg:
One thing that exists in the medical world is a student loan forgiveness program where if you start paying off your loans even during training and you go to work for a non-profit, over a shorter period of time you'll have those loans forgiven. I'm sure there are other programs for non-medical professionals where there's a similar type track where if you go to, for example, an underserved area in your field, that you may be able to have some of your student loans forgiven or paid off.

Bobbi Rebell:
Great. Well, thank you so much, Scott. Is there anything else that you want to add? Anything you want people to know about you? How to reach you?

Scott Steenburg:
Sure. If you'd like to follow me on Twitter, I'm @Radiology911.

Bobbi Rebell:
I love that.

Scott Steenburg:
So that's a nod to my ... that's a nod to my-

Bobbi Rebell:
How did you get that? That's pretty cool that you got that handle.

Scott Steenburg:
I don't know. It just came to me, so I picked it. So that's a nod to what I do. I don't do a whole lot of personal finance there. Most of what I do is medical education, physician wellness, and policy, but if you like to see interesting images, that's where to go.

Bobbi Rebell:
All right. Thank you, Scott. You were wonderful, and really thank you so much for supporting the program.

Scott Steenburg:
Thanks for having me, Bobbi.

Bobbi Rebell:
Hey, friends. So first, student loan debt, as Scott mentioned, is pretty hard to get rid of unless you actually pay it. It stays with you even in bankruptcy, but there are some programs that you can at least look into and some options that are emerging, some new things in just the past few years. I'm going to send you guys to government website called studentloans.gov, and from there you can look for how to repay your loans and go to repayment forms. I'm going to now walk you through some of what you'll see there just to give you a high level sense of your options.

Bobbi Rebell:
So financial grownup tip number one, some loans, like Federal Family Education Loans and Perkins Loans can be eligible for something called Public Service Loan Forgiveness. The key thing for eligibility is that you have made 120 qualifying payments under a qualifying repayment plan while working full-time for a qualifying employer. That's a lot, I know.

Bobbi Rebell:
The key thing, though, qualifying employment is generally things like government organizations, federal, state, local. They even say tribal on that government site. You guys are going to follow up and look for yourselves. Also non-profits, like those with the 501(c)(3) designation. Also some other non-profit organizations, if they provide certain public services, things like AmeriCorps or Peace Corps volunteer. So if you are interested in those things anyway, it could be something to look into that could pay off in more ways than one.

Bobbi Rebell:
Financial grownup tip number second. Now, this is more for the for-profit schools, some of which were not living up to what they promised students, so you can also apply for something called borrower defense to repayment if you took out loans to attend a school that misled you about the educational services that you paid for with the loans. There's a lot of fine print to all of this. You have to follow up by really combing through the website. It even covers the extremely rare times that student debt can be forgiven in bankruptcy, but again, that's very rare. And also, of course, what happens to student debt if the student or the parents, who in some cases are the borrowers, pass away.

Bobbi Rebell:
A few other resources regarding student debt. Check out one of my favorite websites on this topic, The College Investor. It is run by Robert Farrington. He knows a lot about student debt. He even has a great article I'm going to leave. Well, there's many great articles, but I'm going to leave a link to an article that's one of my favorite in the show notes for more ideas to get your debt forgiven, and also answering questions about things you might have heard of that were options in the past but have now merged into other forms, so it's important to keep up with it. It's kind of a moving target, the way that the laws change. Also, SoFi and Student Loan Hero both run blogs that have a lot of useful information. I'm going to leave a link to a great article by my friend and former financial grownup podcast guest, Melanie Lockert, in the show notes as well that has some great resources.

Bobbi Rebell:
Thank you to radiologist Scott Steenburg for being our very first listener to share their money story and advice. It was great. If you want to be considered for an upcoming episode, email us at info@financialgrownup.com. Tell us what money story and what everyday money tip you would share if you were chosen.

Bobbi Rebell:
Thanks to everyone for your support. If you listen on Apple Podcasts, please take a moment to rate and review the podcast. If you are enjoying the podcast, please tell someone that you think would also like it. Spread the word. Post it in one of your Facebook groups and tell people to check it out. If you spot one of our video promos on Twitter or Instagram, share that, and you could win a custom one just for yourself. We're running a little competition.

Bobbi Rebell:
I'm on Twitter, @bobbirebell, on Instagram, at bobbirebell1, on Facebook, at Bobbi Rebell. I can't thank Scott enough for reaching out and being our first listener to share a story. It was a good one, and something unfortunately way too many people can relate to, but I do think his story and his great advice got us all one step closer to being financial grownups.

Bobbi Rebell:
Financial Grownup with Bobbi Rebell is edited and produced by Steve Stewart and is a BRK Media production.

Writer Paulette Perhach, known for her F*** Off Fund articles and website, has been featured in Cosmo and Glamour, but collecting cash from her writing clients was killing her ability to be a financial grownup. Paulette also shares her secret to free stuff- and previews her upcoming book “Welcome to the Writer’s Life, our August 15.. 

In Paulette’s money story you will learn:

-Why Paulette struggles with accepting whether or not she is a financial grownup

-How Paulette became famous, but without the financial rewards following that fame

-The job Paulette had that taught the her most about sales and marketing

-What Paulette did on the day she realized she needed to make some cash- fast

-How Paulette keeps her expenses in check to allow her to pursue her writing career

-Why collecting pay, in a timely manner, is just as important as getting hired

-How Paulette adjusted her pitch to focus less on her needs, and more on her customer needs

-The strategy Paulette used to leverage the contacts she made on one day, into future long term and consistent clients

-The psychological technique Paulette uses when she feels discouraged

In Paulette’s money lesson you will learn:

-The importance of keeping expenses low when income is unpredictable- and specific strategies to do that.

-How and why pay does not line up with work, and how you can manage cash flow challenges

In Paulette’s money tip you will learn

-How she gets things for free!

-The specific items and services she has received that were given to her and why, along with how she contributes to her community

-Where you can find Buy Nothing groups

-About Paulette’s new book “Welcome to the Writers Life”

-Paulette’s advice: If you are in the arts, you are also in sales

In My Take you will learn:

-The importance of keeping overhead low when starting a business, and maintaining cost controls

-How to integrate money making ideas into things you already do and enjoy

Episode Links

Paulette' website: Fuckofffund.com

Follow Paulette- and her bank balances!

Twitter: @PaulettePerhach

Instagram: @PaulettePerhach

Hire Paulette as a writing consultant and much more!! https://hugohouse.org/store/consultant/paulette-perhach/

Pre-order Paulette’s book “Welcome to the Writers Life” !

If you want to be considered for an upcoming listener episode- email us your money story, money lesson and money tip to info@financialgrownup.com

If you want to win a free custom video promo- share and retweet the promos when you see them - and make sure to tag @bobbirebell

---

Transcription

Paulette Perhac:
It's never been too good to hustle. Some days, you got to hustle and yeah, I have a Cosmo magazine right over there with my name in it. Guess what? I have 15 bucks in my bank account like I need to hustle today.

Bobbi Rebell:
You're listening to Financial Grownup with me, certified financial planner, Bobbi Rebell. Author of, How to be a Financial Grownup, but you know what, being a grownup is really hard, especially when it comes to money. But it's okay. We're going to get there together. I'm going to bring you one money story from a Financial Grownup, one lesson and then my take on how you can make it your own. We got this. Hey friends, before we get to our awesome guest, Paulette Perhac known for what she calls in our friendly universe, the Foe fund.

Bobbi Rebell:
It'll make sense, trust me. I just want to welcome all of our new listeners to the podcast and also welcome back our regular listeners. We keep your episodes short to fit your schedule, but also to be flexible. So you can binge and hear a few great stories when you have a little more time in your day. If you are enjoying the show, please take a moment to tell a friend about it. Share it on social media, we want to get your help growing the community and we really appreciate it by the way.

Bobbi Rebell:
Now to our guest, Paulette, as you will hear, I joke with Paulette Perhac that she's not quite a financial grownup, but really are we ever? It's a process and for Paulette, the process has been painful at times. She has received a ton of acclaim for her writing and even has been able to raise her rates a bit, but collecting the cash, that has kept her on the financial edge and forced her to get creative. You're going to like this one. Here is Paulette Perhac. Hey Paulette Perhac you're a financial grownup or at least getting there. Welcome to the podcast.

Paulette Perhac:
Thanks for having me, Bobbi.

Bobbi Rebell:
And we're getting it a little bit giggly, which will make a lot of sense in just a minute when Paulette tells her story. But you are an emerging major writer. You've had pieces all over the place including the piece that got you really famous called the F off Fund and we're going to keep it clean here so no worry. If you are in the car listening with your kids, but Paulette, before we get to your money story, tell us a little bit about this article that sort of blasted you into the universe.

Paulette Perhac:
So we call it in my family around my nephew the fore fund, so-

Bobbi Rebell:
The Fore fund, I like that.

Paulette Perhac:
As I was coming into my 30s and got a great job at a tech company and had for the first time a few thousand in the bank that didn't have a name on it. I was thinking back to some memories that I had of times that I was desperate for a job or couldn't move out because I just couldn't afford to. I realized, "Oh, it would've been so nice if I had, had this money in that bank account." And you don't really think about because humans have this optimism bias.

Paulette Perhac:
If you don't think bad situations you're going to get in. So, I really described a situation in which you do the normal thing. Where you're living paycheck to paycheck and then getting bad situations or if you decide to be someone who can have a fore fund in case you need it and what that would look like. So I described those two scenarios in the fore fund article. I thought it was just another essay and then it blew up and it went all around the world and just this month, both Cosmo and Glamour mentioned it. Two years later, which is crazy.

Bobbi Rebell:
Great, and now that's becoming a whole business, which we're going to circle back to. But I want to hear the money story that you're ready to share with us, and it's so apropos because just moments ago what crosses on my Instagram, but a snapshot of your bank account, which despite all of the success with your fore fund writing and the business that is emerging from that article, which is unbelievable, that this is all happening to you.

Bobbi Rebell:
Sometimes massive career success and prominence does not always connect to money. So, you found yourself one day with how much money in your bank account would you say?

Paulette Perhac:
So I had about $900 and my rent on my tiny place in Seattle was about to come through at 795.

Bobbi Rebell:
And by the way, because we were just joking about this, your apartment is how big.

Paulette Perhac:
It's 150 square feet.

Bobbi Rebell:
Okay. Just saying not like you're living so large.

Paulette Perhac:
Not living so large. So I was like, "What do I do?" And I had just been feeling like I'm living large because you and I were in the Catskills in New York. I'm going to these parties with like Aaron Lowery and meeting with my editor at the New York Times and having breakfast with another reporter at the New York Times.

Bobbi Rebell:
Just like big media people, big stuff that's happening.

Paulette Perhac:
Yeah, big stuff is happening. Having meetings with people who are on the Forbes Top 100 most powerful women list. Awesome, right? And we're in talks about future projects, et cetera. So, it's like everything's coming together. Then I landed home and I'm like, I have $100. I don't have any work lined up. I just posted yesterday on Instagram a timeline of something I'm about to get paid for. I pitched that story on February 12th. So that shows you how long it takes to get from pitch to payment?

Bobbi Rebell:
Right.

Paulette Perhac:
And so I'm like, "Oh my gosh, I'm in trouble. What am I going to do?"

Bobbi Rebell:
You need cash immediately.

Paulette Perhac:
I need cash. Yeah. So the panic starts to rise up, right? And I've really realized this year that the panic is not helping you and so you just have to calm down whenever you feel those feelings. I'm like, what will help you feel more powerful? I'm like, you need like an adult lemonade stand, and I just decided a lemonade stand-

Bobbi Rebell:
And by lemonade stand, what do you mean?

Paulette Perhac:
I mean like a personal mini business from which you feel fairly confident you could make some money in the next 24 hours and that's marketing, execution and billing. So, I took the last of my business cards and I printed up a label for the back. Mother's Day was that Sunday, so I'm like, Mother's Day, I'm hustling. So I printed up labels that said mother's Day photos, like quick and easy or quick and fun. Mother's Day photos, 15 minutes, 20 bucks.

Paulette Perhac:
And I took my camera. I looked at like, what are my assets, right? I have a car, I could drive around, I can't do uber, it's from 1996. So I could deliver food.

Bobbi Rebell:
Uber has standards.

Paulette Perhac:
Uber has standards, I do not. A to B, that's my standard. So I looked at my other asset, which is this really nice camera that I bought as an investment in my writing, in travel writing business. So I just went around and hustled all day, Mother's Day. I think I walked six miles. I ran out of business cards, but I-

Bobbi Rebell:
What was your pitch? Tell us your pitch.

Paulette Perhac:
My pitch. I started by being like, "Hi, I'm a local writer and a photographer," and people were just like, "ugh." So, I realize I'm talking about myself. Nope, so it evolves over the day to focus on the customer and I just said, "Hi, happy mother's Day," because no one's like, "Go away if you say Happy Mother's Day." I said, "Happy Mother's day, if you guys want a nice photo, I'm doing $20 portraits today." So it was a really fun day overall.

Paulette Perhac:
I felt empowered. I felt like I was taking control and then I got some follow up clients actually, I'm rewriting one of the groups of women. One of them was from San Francisco. She's a realtor from San Francisco. We got to talking. They were great, I gave them a little bit of extra time just because it was fun, and she is hiring me to rewrite her bio for 300 bucks.

Bobbi Rebell:
That's so awesome. That's so awesome. Wait, so how much did you make that day and how much did you make from that day going forward?

Paulette Perhac:
So my supplies were 12, and then I had to get more cards printed, which was like 33. So I was like, "Oh my gosh." So after taking those out, I only made $85 that day, which is not a ton, it's not nothing. What I realized was that I now have given my card out to a bunch of people who know I'm a photographer.

Bobbi Rebell:
Right.

Paulette Perhac:
One woman was pregnant, she asked me if I do maternity photos, and then next time what I'll do is just have an A frame sign and stay in one place. Because I think that, that will be more successful, less hustling work for me. I laid down at the end of that day in the park after giving out all my cards, and I was just pooped. I felt really good. I felt like the best kind of exhausted.

Bobbi Rebell:
But you did something.

Paulette Perhac:
Yeah, I did something.

Bobbi Rebell:
You did something, like you had a problem, and you did something proactive to solve it instead of just kind of living in your panic about money.

Paulette Perhac:
Yeah, and I think self-pity is really dangerous, especially if you work in the arts, because you have to remember like I chose this life, what am I going to do about it? Sitting there and just being like, "Wheh, I don't get paid on time. Wheh, it's hard to be a writer." Not saying I never sit there, but when I'm in that space I realize that it's dangerous.

Bobbi Rebell:
Talk about the lessons that you would share with our listeners. What's the takeaway here?

Paulette Perhac:
So I think the takeaway is knowing that you don't owe a whole lot. So for me low overhead is really important. You know, it's just nice to know that my rent including utilities, is 795, I almost never feel like, "Oh I can't pay that." I also have a book coming out in August, so that's a lot of unpaid marketing work for the book.

Paulette Perhac:
So I think having that plan, like knowing like what would I do today if I needed money and just knowing, so like for example, I'm going to go to a music festival over Memorial Day and I'm going to do it again, taking music festival portraits there. I'm really excited about that, and I think it's going to get better and better, and I'm going to make more and more every time I need to do that.

Paulette Perhac:
And I think eventually I won't need to do it anymore, but it's never been too good to hustle too. Some days you got to hustle, and yeah I have a Cosmo magazine right over there with my name in it. Guess what? I have 15 bucks in my bank account like I need to hustle today.

Bobbi Rebell:
So Paulette, tell us about your money tip.

Paulette Perhac:
So my favorite secret money tip is to join a buy nothing group, which are these groups that are popping up that kind of celebrate trading, and giving and, just offering if you have anything. And so I just got a Le Creuset casserole dish on it yesterday. I got a vacuum last week, and then when I moved into my tiny place, and I had a ton of stuff to give away, I gave away a bunch of stuff. I just got a haircut this morning on the buy nothing group at a place that usually probably costs 100 bucks for a haircut.

Bobbi Rebell:
Wait, how do they make sure that people don't come on and just take, take, take.

Paulette Perhac:
You could just take, take, take. I haven't seen that problem yet. You know, I think people are willing to give. It's things that they would be giving away anyway, but I have found that the more that I get from it, the more I want to give. And people have offered financial advice, people have offered instruments, and it's just kind of this nice community, especially if you live in a big city, it's a very small area. So now I kind of know my neighbors more.

Bobbi Rebell:
So how do you find these groups?

Paulette Perhac:
So I would google buy nothing, mine is the Facebook group.

Bobbi Rebell:
Is there criteria to get in, or they just let anyone in? How is it? It sounds too good to be true.

Paulette Perhac:
I know, right? Well, I think the thing is I've been in both situations where the things that people have given me have helped me so much to get new furniture or whatever. And so then once I got from the group giving was a pleasure.

Bobbi Rebell:
Well, you're also so much part of the writer's community. You spend so much of your time and energy giving back to other writers and supporting writers. Tell us about your book that's coming out soon. It's happening.

Paulette Perhac:
So on August 15th, my book, Welcome to the Writer's life is coming out, which is everything I've learned about the writing business, the writing craft and the writing life from being in a writing community. So it's a very crowd sourced book and very much wanting to give back what I've gained from living in a creative community. And it's like freshman orientation for new writers, and a lot of people have benefited from it even if they do business writing or side writing. You don't have to be a full time writer, you just have to want to get joy out of the act of writing.

Bobbi Rebell:
And what have you learned in your years about the business of writing? In other words, you talk about how hard it is to get paid.

Paulette Perhac:
I think if you're in the arts, you are also in sales, which we don't want to say out loud, but you have your leads, you have to bring your value prop, like you have to sell your stuff, and consider yourself a business. I wish that I had said I'm starting a freelance business, rather than I'm going freelance because that's what it is. So you're not ready for operations and marketing and sales and you just get sledge hammered by the reality of like, "Oh I got to go sell today," which is like what you have to do.

Paulette Perhac:
So I've been in it like two years full-time, and I'm just now like, I have a whole share point for my writing business. I'm getting serious because I don't want to fail.

Bobbi Rebell:
All right. Miss Paulette, how can people find you and follow you and hire you most importantly?

Paulette Perhac:
Yes so send money to ... No. I'm on Twitter @Pauletteperhac. My website is fuckofffund spelled out, .com, so fuckofffund.com, and I'm on Instagram @PauletteJperhac where you can see my bank balances. Just google me and you'll find me, and I have a lot of different projects. Mostly I want to bring people who want to live creative lives. I want to help them make the creative life happen while I figure it out. That's really the thing is like I'm someone who's traditionally bad with money.

Paulette Perhac:
I'm getting better with money and want to live that creative life. I love my life. I love my day to day that this is my life and I want to make it work. So I want to help other people do it too.

Bobbi Rebell:
Well, we love watching your star rise, so thank you so much.

Paulette Perhac:
Thank you so much, Bobbi.

Bobbi Rebell:
There is so much we can all learn from Paulette. I hope you enjoyed that interview. Financial Grownup tip number one. When you are running a business or just the business of your life, keep your overhead low. Paulette lives in a very expensive city, but she makes it work by keeping those costs down and living anything but large. Her apartment, as she mentioned, is a 150 square feet. That's a closet to some people, some very fortunate people, but still some people.

Bobbi Rebell:
She also literally does not pay for things. She's in a buy nothing group. So maybe find a buy nothing group near you. What a great tip. Financial Grownup tip number two, integrate your hustle into things you're already doing. Paulette loves to go to concerts and festivals, so she brings her camera and her business cards and you know what? She makes money even while living her life. Thanks Paulette. We have our first listener episode coming up very soon in the month of June.

Bobbi Rebell:
If you want to be on the show and have a great money story to share, email us at info@financialgrownup and tell us what the story is and what your everyday money tip would be if you were to be chosen. Thank you for being part of our Financial Grownup community. If you're enjoying the show, consider leaving a rating or review. And of course hit that subscribe button to make sure you don't miss any episodes.

Bobbi Rebell:
Follow me on Twitter @Bobbirebell, on Instagram @Bobbirebell1, and by the way, thanks for the great feedback on our promo videos. If you would like one for you or for your business, share the video when you see them. We'll be making one for whoever shares the most between now and July, 1st. You could even see them by the way, on our new YouTube channel. Just search for Financial Grownup with Bobbi Rebell, and you will find it.

Bobbi Rebell:
And by the way, soon after we taped Paulette's interview, she did finally get paid by her client, so a happy ending there. A quick reminder, Paulette's book, Welcome to the Writer's Life is available for pre order, so go get it. I think it's safe to say her story successfully brought us all one step closer to being Financial Grownups. Financial Grownup with Bobbi Rebell is edited and produced by Steve Stewart and is a BRK Media production.

Entrepreneur and influencer Amanda Abella found out she was underpaid and often overlooked. But when she started playing hardball in negotiations with a really big potential client, she and her agent did not get the response they expected. 

 

In Amanda’s money story you will learn:

-All the things Amanda does to have multiple income streams tied to her own personal brand

-The challenges Amanda faced after graduating from college during the recession

-How her first job laid the groundwork for her current career as an entrepreneur

-How she and her agent planned for their negotiation with a potential client

-The pivotal decision that grew her brand ambassador asking rate almost 7 times over by focusing on her unique skillset

-What is a rate sheet, and what brand ambassadors do for clients

-How Amanda researched what was a new market/line of work for her business

-If Amanda has any regrets or things she would do differently in hindsight

In Amanda’s lesson you will learn:

-How she battles her nerves in high stakes negotiations

-Why the number of social media followers are less important than many people believe

-How to get brand partnerships by knowing what matters most to them

In Amanda’s money tip you will learn:

-How to find out about unpromoted discounts at restaurants and fitness clubs like SoulCycle

-How much you can save by using them, even if they are not advertised

-Amanda’s favorite places to get discounts and freebies

-What Amanda got for free recently at SoulCycle

-Why Amanda keeps getting water bottles

In My Take you will learn:

-How to asses what you bring to the market, to better negotiate higher rates

-What to do if you don’t currently have skills that add value to, and command a premium from, the clients you want to attract

-Tips to be more confident in a negotiation

-How the power poses, recommended by Amy Cuddy can give you an instant confidence boost when you really need it

EPISODE LINKS

Amanda’s website: amandaabella.com

Amanda’s podcast

Amanda’s course on becoming an influencer

Follow Amanda!

Twitter @amandaabella

Instagram- make sure to check out her feed AND stories: @amandaabella

Facebook Amanda Abella

Soulcycle.com where Amanda loves to get free stuff!

Check out Amy Cuddy’s Ted Talk!

 

---

Transcription

Speaker 1:
Support for Financial Grownup with Bobbi Rebell and the following message come from TransferWise, the cheaper way to send money internationally. TransferWise takes a machete to the hefty fees that come with sending money abroad. Test it out for free at transferwise.com/podcast or download the app.

Speaker 2:
We went to the table with this very high number expecting them to push back on it and they didn't. Not even one peep. Not one question, not one push back. They were just like OK sign on the dotted line.

Bobbi Rebell:
Your listening to Financial Grownup with me, certified financial planner Bobbi Rebell, author of How to be a Financial Grownup and you know what being a grown up is really hard especially when it comes to money. But it's OK. We're going to get there together. I'm going to bring you one money story from a financial grownup, one lesson and then my take on how you can make it your own. We've got this.

Bobbi Rebell:
If you like making money and want to know how to make more and ideally from different sources you are in the right place with our guests. Before we get to her though we've been getting a lot of new listeners so I want to just welcome all of you to the show and of course thank you so much to our returning listeners. So glad you are here. And if you have friends or family that you think would enjoy the show please tell them about it. Also the video promos everyone is asking about. So glad you guys like them. If you want one for your business or just for you we're having a little competition. I'm going to make one for a listener. All you have to do is share the promo videos on social media, starting now until July 1st whoever shares the most wins. I will announce the winner the first week in July.

Bobbi Rebell:
All right. Now to my friend and guest Amanda Abella. Besides the fact that for some reason her Instagram stories seem to be more entertaining than most TV shows she's hard to label because she does as she says all the things. Amanda is all about multiple income streams. She has a book Make Money or Honey, an award winning blog. She has been a brand ambassador for big names like Capitol One and [Into It 00:02:05]. She teaches millennials how to be entrepreneurs and influencers just like her and she will soon be bringing back her popular podcast. Here is Amanda Abella.

Bobbi Rebell:
Amanda Abella, you are a financial grownup, welcome to the podcast.

Amanda Abella:
Hi. Thanks for having me. I'm so psyched to be here.

Bobbi Rebell:
And we've got to hang out and get to know each other recently at the Statement event in upstate New York. That was awesome.

Amanda Abella:
It was so much fun. I needed that so bad. You have no idea.

Bobbi Rebell:
I think we all did. I learned a lot about you. I mean you do all the things Amanda. All the things.

Amanda Abella:
Yeah all the things, literally all the things. I like my money coming from different places.

Bobbi Rebell:
Yes, multiple revenue streams, you're an entrepreneur, you're an author, your bestselling book is Make Money or Honey. And you also have an amazing social media feed that we were all gushing over at the retreat, especially your Insta Stories. You also are an influencer, you even have a course on how to be an influencer and you're a brand ambassador.

Amanda Abella:
Yup I literally do all the things.

Bobbi Rebell:
All the things.

Amanda Abella:
Yeah. What happened with me was you know I graduated during the recession and I just kind of learned really early on to always have your money coming from different places and then I was a recruiter for two years and I interviewed people who lost their jobs all the time. So I was like you always need to have multiple sources of income because if one thing doesn't work out like you get fired, well you still have money coming in from this other place so it started as a survival mechanism and now it's just a wealth building strategy.

Bobbi Rebell:
Wise words my friend. And one of your multiple income streams that is growing is your brand ambassador business. And that brings us to your money story that has to do with a big new client that almost wasn't as big as you wanted it to be. Tell us.

Amanda Abella:
Yeah so what happened there was I started getting approached a lot more for brand ambassador work. And first of all I had no idea how much money you could make doing this stuff because I was just having so much fun. I didn't know what the market rates were. I didn't know how to negotiate these situations. I didn't know anything about the contracts. But I started getting approached for this kind of work. So I went to go find myself an agent because I was like I need help. And the agent trained me a little bit on what to do in the meetings and all those kinds of things. And we were negotiating with this really big client. It was the first time I was going to do something of that magnitude and we were trying to figure out my rate sheet.

Bobbi Rebell:
What kind of business was the client in? Can you tell us anything about it?

Amanda Abella:
Financial software.

Bobbi Rebell:
Okay.

Amanda Abella:
So we were trying to figure out my rate sheet for all the different deliverables and things like that because that's how green I was right, like I didn't even have a rate sheet.

Bobbi Rebell:
What kind of deliverables would be on the rate sheet?

Amanda Abella:
You know media appearances, social media posts, blog posts, e-mail blasts, Twitter chats, all that type of stuff, all the different things that they ask you to do. I was so green I didn't even have a rate sheet for these things. And we were trying to figure that out at the same time while negotiating with this particular client.

Bobbi Rebell:
Where do you even start? Is there some kind of a standard place you can go and get that information?

Amanda Abella:
So what really helped me was asking a lot of my friends who were already doing that kind of work. And that's actually how I found out that for many years I have been low balling myself just because I didn't know, like I had no idea. I had no idea I could get paid what they were getting paid and then also one of those friends is the one who connected me with my agent and my agent who has been doing this for a very long time she kind of schooled me on how much money I was leaving on the table. So that was really helpful for me too. So that's how I found out personally.

Amanda Abella:
So what was going on was when we were trying to figure out the rate sheet we were trying to figure out the numbers and I went pretty high on this client to the point where my agent who you know she was doing her job. She's coming from many years of experience was like are you sure you want to do that because you're still pretty green, like do you want to go that high. And I thought to myself well you know what I may be green in terms of working on these big campaigns but I've got plenty of years of blogging experience. I have a pretty big social media following, they're pretty engaged. I'm bilingual. You know I bring things to the table that they need. So let's just go high and see what happens. She agreed. So we went to the table with this very high number expecting them to push back on it and they didn't.

Bobbi Rebell:
Wow.

Amanda Abella:
Not even one peep, not one question, not one push back. They were just like OK sign on the dotted line.

Bobbi Rebell:
So but here is the question Amanda. Knowing what you know now would you have gone higher?

Amanda Abella:
Well I was already pretty high for me. I mean my agent was to the point where she was like congratulations you just gave yourself a bonus of thousands of dollars for this kind of work. Good job negotiating that one. So I thought about that and for this particular client no because that was already super high for me to begin with. But-

Bobbi Rebell:
How much of a percentage higher was it than you kind of thought you were getting or that you were getting before?

Amanda Abella:
It was way more than double. It was like six or seven times more what I was getting previously.

Bobbi Rebell:
Whoa. OK. I'm sorry go on.

Amanda Abella:
So then having learned from that experience which was also my first experience like being in those meetings with an agent and learning those sort of nuances when you're in those situations with PR teams and things like that it was definitely a real lesson and you know confidence sells. Number one. And number two, fake it till you make it if you have to.

Bobbi Rebell:
But you actually came, you weren't really faking it because it sounds like when you went to them you had very specific reasons why you were worth what you were asking.

Amanda Abella:
Yeah but it doesn't mean I wasn't nervous.

Bobbi Rebell:
Of course.

Amanda Abella:
I think people think that you walk into these situations and you're like fearless and you're not, you're just pretending not to be fearless which is where the confidence comes in. But you're right I did have specific experience and specific angles and specific things that I knew they wanted for this specific campaign and I definitely used it to my advantage. And like I said my agent agreed. So you know on the mere fact that I was bilingual I can get more money just because I'm bilingual and living in a city like Miami where everybody is bilingual I forget that that's actually a really valuable asset that I could get paid a lot more money for.

Bobbi Rebell:
So what is the lesson for our listeners who may not all be social media all stars and brand influencers, brand ambassadors, how can they apply this to their own lives?

Amanda Abella:
I think it's realizing that there is a lot of talk about the influence that you have in the social media numbers. They're really not that important. One of the things my students tell me all the time is I had no idea that I could get that kind of work with 3000 followers on my Instagram feed or a thousand people on an email list. They all go into my program assuming that they need you know tens of thousands or 100000 followers to get really good brand partnerships and what they don't realize is that brand partnerships are looking more for unique angles and engagement more than they're looking for the actual numbers. Because I mean you could pay to get followers and brands know it.

Bobbi Rebell:
Alright. I want to move on to your money tip because this one is going to be a huge hit with our listeners. I love it because you're going to spill some secrets for us. What's your money tip Amanda?

Amanda Abella:
So my secret is all about the rewards programs that restaurants are really bad at marketing.

Bobbi Rebell:
Therefore they are secrets, they're sort of open secrets that nobody knows about.

Amanda Abella:
So if you frequent certain places and certain restaurants, I've noticed it's definitely more with the chain restaurants. A lot of times they have apps and on those apps they have rewards programs or loyalty programs or referral programs. So for example I go to a specific juice bar pretty often after I work out. I learned recently that they had an app where I could get like 10 percent off my [inaudible 00:10:13]after spending a certain amount or if I refer friends I get three dollars off my next juice. I had no idea because they hadn't actually like said anything to me, I just happened to see a, I saw a little thing on the napkin holder and then a friend also told me he was like you don't know that they have an app.

Bobbi Rebell:
That's so random.

Amanda Abella:
So my tip is not only to use the apps and find them but ask to see if they're even available because like I said they don't necessarily do a really good job of telling their customers that these things exist. Unless you're Starbucks.

Bobbi Rebell:
Yes, Starbucks is pretty aggressive about promoting their app. But other companies maybe not so. And if you take the time just like with so many of the money tips that we talk about here if you take the time to focus and learn about these programs, ask about them, you will benefit.

Amanda Abella:
Yep, it's all about asking.

Bobbi Rebell:
So what's the best deal you've ever gotten through an app?

Amanda Abella:
Hmm well I'm getting 10 percent off my [inaudible 00:11:07]now. So that's pretty good.

Bobbi Rebell:
Okay. Pretty good.

Amanda Abella:
Yeah I'm kind of addicted to them to be honest so I would say that's the best one although I would say probably my best deals have been through the Soul Cycle app.

Bobbi Rebell:
Oh OK.

Amanda Abella:
Yeah. So I do Soul Cycle. You know if you sign up for like certain challenges, if you're working out already anyway, you sign up for certain challenges or certain themed rides or they'll have certain promotions going on. Like I walked in yesterday and they gave me like a bag of free stuff because I'm partaking in this certain challenge and I've been tracking it you know on the app and then once I get to a certain amount of rides which the app tracks then I get a free ride. So that's probably the one that has saved me the most money because Soul Cycle is not cheap.

Bobbi Rebell:
Wait, can we just back up here because I really want to hear about the free stuff. What was in the free stuff bag from Soul Cycle?

Amanda Abella:
Yeah. So I got a bag. I got like a top to work out in. I got a water bottle. People just keep giving me water bottles lately, I have a whole collection of them.

Bobbi Rebell:
Yeah water bottles are, we got water bottles on the retreat.

Amanda Abella:
Yeah. I was joking with my roommate I was like I lose one water bottle and require another four no matter-

Bobbi Rebell:
I know, I know. I am very excited about the Soul Cycle free stuff though. You have delivered, that alone Amanda, you scored. I want to talk about you because one of the things that happened on the retreat was you made a decision to pick something up that I loved. I loved your podcast and I'm so happy that you're going to bring it back.

Amanda Abella:
Yeah so I'm bringing my podcast back after much deliberation and I really want to thank Statement and all the women who attended it and all the tips you gave me Bobbi because I've been studying your podcast since I got back.

Bobbi Rebell:
Thank you.

Amanda Abella:
I was like Bobbi is on point. Bobbi knows what she's doing. I'm going to take some notes.

Bobbi Rebell:
Thank you.

Amanda Abella:
So I'm bringing my podcast back. It's coming back in July and it's going to alternate between solo episodes where I'm answering a lot of my audience questions about you know business, online marketing, negotiating, making money, all those types of things and then I'm also going to be bringing on a lot of guests so a lot of the women who were at the retreat have actually already signed up to be on the podcast so I'll be interviewing them. It will be a lot of fun and I'm trying to really bring as much diversity as I can to the conversation. So a lot of women, a lot of people of color. I'm Latina so that's something that really matters to me. One of the things I've heard so much from people is how sometimes it's hard for them to really relate to a lot of the mainstream financial advice that's out there because these people just you know either don't look like them or don't have the same experience as them. So I'm trying to bring as much diversity to the conversation as I can.

Bobbi Rebell:
Well thank you for that. I'm working on that here too. So I think we are hopefully on a good path with all that. Where can people find you, especially your Insta Stories which we're all obsessed with.

Amanda Abella:
Yeah my Insta Stories are a lot of fun. You guys can go watch me freak out over seeing snow for the first time on my Insta. Bobby was there for that. So you could go to Amanda Abella. That's my Twitter and my Instagram, I'm all over those all day long. You could also go to my Web site amandaabella.com or you could find my podcast, previous episodes of my podcast. So they're on iTunes, Stitcher, I Heart Radio, Spotify, YouTube, just search make money or honey or my name.

Bobbi Rebell:
Thank you Amanda.

Amanda Abella:
Thanks so much for having me.

Bobbi Rebell:
Hey friends, so here's my take on what Amanda had to say. Financial grownup tip number one. Take a moment and write down the skills that you have that are unique, things you can use as leverage to get more money in a negotiation. So in Amanda's case one thing that she is is Latina, she's also bilingual. If you can't think of something, become something. Learn a skill that will set you apart from others. Invest in yourself in a specific intentional way that will give you a foundation to command higher compensation. Focus on the skills that are most in demand but still hard to find in your field.

Bobbi Rebell:
Financial grownup tip number two. Amanda talked about the fact that confidence sells and that you have to sell yourself. She did OK when she waited for businesses to come to her but her business really took off when she took control and became proactive. Find a way to appear confident even if you're having jitters inside like Amanda admits she sometimes does. If you need to just leave the room to gather your thoughts if you're getting nervous during a negotiation. Maybe do some power poses. Look up a TED talk by a woman named Amy Cuddy. I'll put it in the show notes and you will see what I mean. I've done it myself and it really works.

Bobbi Rebell:
We have our first listener episode coming up in June. If you want to be on the show and have a great money story to share email us at info@financialgrownup.com and tell us what story you want to share and what your everyday money tip would be if you are chosen. Thank you all for being part of our financial grownup community. If you enjoy the show consider leaving a rating and review on Apple podcasts and of course hit that subscribe button to make sure you don't miss any episodes. Follow me on Twitter @BobbiRebell. On Instagram I am @BobbiRebell1. Don't forget to DM me with your feedback about the show. I love hearing from everyone.

Bobbi Rebell:
And also if you want a custom video like the promos that we do for the show join the competition. Share the videos when you see them on social media. Retweet, repost and so on. You can even see them by the way on YouTube now. We will pick a winner by July 1st. So look for us to move forward in early July. Amanda is amazing. I'm excited for her podcast to come back so make sure to watch her social channels for updates on that. Great episode. And thank you Amanda for giving us the confidence to ask for what we deserve and sometimes even more than we think we can get. Helping us all get one step closer to being financial grownups.

Bobbi Rebell:
Financial grown up with Bobbi Rebell is edited and produced by Steve Stewart and is a BRK media production.

Jen Hemphill and her husband believe in supporting family, but when the author of Her Money Matters, and the host of the podcast of the same name, was asked to lend money to a relative, she realized it would come at a cost to her own financial well being. 

In Jen’s money story you will learn:

-How she and her husband have different approaches to helping family financially

-The role emotions play in decisions about lending and/or giving to family

-The impact Jen’s upbringing and her parents attitudes towards money played in her approach to lending and gifting money to family

-How communication issues can impact financial decisions

In Jen’s money lesson you will learn:

-Jen’s advice in how to respond when family needs financial help

-How you can prepare to be able to help family when it is needed

-How to stay on track with your own goals, even if family needs help

-Why Jen feels it is always better to gift than to lend to family

In Jen’s money tip you will learn:

-The specific strategy she uses to separate funds and save for goals

-How she applies her strategy of separate funds when it comes to every day savings at places like the grocery store

-How to use apps to facilitate using her strategy to save money

In my take you will learn:

-What to keep in mind when friends and relatives ask you for help

-Strategies to have money available for that purpose

-How to say no when helping financially is not in your budget

 

EPISODE LINKS

Get Jen’s new book!

Her Money Matters: The missing truth from traditional money advice

Follow Jen!

Twitter: @jenhemphilll

IG: @jenhemphill

Facebook https://www.facebook.com/jennifer.hemphill

 

---

Transcription

Bobbi Rebell:
Support for Financial Grownup with Bobbi Rebell and the following message come from Transferwise, the cheaper way to send money abroad, built by the brand behind Skype. Transferwise takes a machete to the hefty fees that come with sending money abroad. Don't get sting by a bad exchange rate, or sneaky fees, join the two billion people who are already saving with Transferwise. Test it out for free at transferwise.come/podcast, or download the app. It is the wise way to send money.

Jen Hemphill:
We lent him the money, or actually gave him the money, and never saw it back. We had debt. We had things that we needed to pay for, things that we needed to purchase, and it also diminished our abilities to have that extra money to pay the debt that we had. Right? It was a very conflicting time.

Bobbi Rebell:
You're listening to Financial Grownup with me, certified financial planner, Bobbi Rebell, author of How To Be A Financial Grownup. You know what? Being a grownup is really hard, especially when it comes to money, but it's okay, we're going to get there together. I'm going to bring you one money story from a financial grownup one lesson, and then my take on how you can make it your own. We got this.

Bobbi Rebell:
Hey, friends. Thanks for joining us for this addition of the Financial Grownup Podcast. Before we get to our amazing guest, I am getting great feedback from all of you about these video promotions that we have been running to support the show, and you're asking me a bunch of questions, so I'm going to answer a few of them here. The first question everyone is asking me is, who is making them for me, who did I hire? I didn't hire anyone, I'm doing them myself. As you guys know, I love to learn new things, different technology, different programs, so I taught myself how to do them, and I'm having a great time.

Bobbi Rebell:
Second question, I keep being asked is, where can I get them made for myself? Well, I am not going to go into the video promotion business, I'm just going to be doing it for Financial Grownup, at least for now, never say never. But in answer to the request, I am going to run a fun contest. For the next month or so, until early July. The first week in July, let's say, we are going to have a competition, where if you see the video promotions for Financial Grownup on social media share them, and whoever shares the most by the first week in July, I will make a video promotion for you. It can be for your business, it can be for an event that's coming up, it can just be for you, it can be a birthday message for a friend, or for your child. Whatever it is, anything reasonable we will make a fun video, and that will be my gift to you guys.

Bobbi Rebell:
Okay. Onto our guest, Jen Hemphill. She is the host of the podcast, Her Money Matters, and the author of a new book by the same name. She is a big believer in helping family, but as a money expert she's also aware that sometimes those asked to give money may not really be in the best position themselves to be the ones giving. What do you do? Here is Her Money Matters, Jen Hemphill ... Jen Hemphill, you are a financial grownup. Welcome to the podcast.

Jen Hemphill:
Thank you so much for having me, Bobbi. I'm excited to be here.

Bobbi Rebell:
I'm excited to hear more about your new book, Her Money Matters, which of course same title as your amazing podcast. Tell us just briefly about it, and we'll talk more about it after your story.

Jen Hemphill:
Sure. Basically, the whole premise of the book is to give more of a holistic approach to personal finance. It's not a book that's going to tell you how to budget, how to get out of debt, but really it's about the missing pieces that a lot of people don't talk about, because all we hear about save more, spend less, and get out of debt, but there's the emotional component of money that I dig a lot into, as well. It's really more the missing pieces, that is really not talked about, in general.

Bobbi Rebell:
Okay. I want to get to your money story, because it has to do a lot with emotion, and the feelings behind when you gift, or lend money to friends, and family, because they can be sometimes the same things, sometimes lending becomes a gift, and you and your husband have very different approaches to it. Tell us about the first time this came up.

Jen Hemphill:
Well, the first time this came up was when we were first married, so this was almost, we'll be married almost 18 years, so this was-

Bobbi Rebell:
Congratulations.

Jen Hemphill:
Our first, oh, thank you. This was our first year in our marriage. We're a military family, we were stationed in Clovis Air Force Base in New Mexico.

Bobbi Rebell:
Wow.

Jen Hemphill:
First year married, we were really still trying to get to know each other, all the newlywed stuff. He got a call from my brother-in-law, and he, my brother-in-law apparently had hit a financial hiccup, and he reached out to his brother for help. Now, I grew up in a household that was very giving. My parents literally grew up in Columbia, and they always helped people. There was always people that would stay at our home, with their family, or some friends. My parents were always givers, even when they didn't have to give. Right?

Bobbi Rebell:
Right.

Jen Hemphill:
I saw that a lot growing up. I knew the financial struggles that they dealt with.

Bobbi Rebell:
We're they dealing with financial struggles because they gave more than they could afford?

Jen Hemphill:
I don't think it was that-

Bobbi Rebell:
Okay.

Jen Hemphill:
That might have been a component, but not all of the components. Right? But it was partial, because I saw them giving, and giving, but they were still trying to get their money stuff together. Right? I saw a lot of that. When I met my husband, one of the things that I love about him is his big heart. He is definitely a giver. He's also a spender.

Bobbi Rebell:
Are you the saver to a spender, by the way?

Jen Hemphill:
Yeah. I'm also a saver.

Bobbi Rebell:
Okay.

Jen Hemphill:
When my brother-in-law reached out to him, we had the conversation, granted again, we were newlyweds. We were trying to figure this thing out, and I can't remember the exact $1.00 amount, but it was more than $500.00.

Bobbi Rebell:
Do you know what kind of situation it was? Was it like a medical operation? Was it a business situation?

Jen Hemphill:
It was behind on bills, collections. Those type of things.

Bobbi Rebell:
Your husband wanted to give him a loan, not a gift a loan?

Jen Hemphill:
Well, he told me a loan, but I knew him.

Bobbi Rebell:
Okay.

Jen Hemphill:
He's a giver. He's not going to expect it back. Where I was more, in my mind, a lender. If you're asking us to lend you money, I'm like, “Okay. You're going to pay us back.” We had debt. We had things that we needed to pay for. Things that we needed to purchase. Literally, at that time we just had our checking account, and our savings account and literally whatever savings went into our savings account, so it was the emergency account, it was when we overspent, it was for big purchases, so everything that was needed that wasn't in our checking account came from the emergency fund. It literally got depleted fast, and it also diminished our abilities to have that extra money to pay the debt that we had. Right? It was a very conflicting time. We had this conversation-

Bobbi Rebell:
[crosstalk 00:07:19]-

Jen Hemphill:
We lent him the money, or actually gave him the money, and then never saw it back.

Bobbi Rebell:
Right. The communication to him, was it, “We are lending you this money,” and he didn't pay it back, or was it, “We are gifting you this money.”

Jen Hemphill:
That's a good question.

Bobbi Rebell:
Good luck with it.

Jen Hemphill:
Because my husband had that conversation with him.

Bobbi Rebell:
Okay. We can't really blame your brother-in-law, because for all we know he was told it was a gift, to be fair.

Jen Hemphill:
Right.

Bobbi Rebell:
What is the lesson, now, 18 years later, you guys happily still together, what is the lesson for our listeners? How would that go now? Would you put your foot down more? What would happen now? What do you think listeners should do? Should they be in a similar situation?

Jen Hemphill:
What we've done is, we included this in our budget, so we set some money aside in a different account, and whenever a family member needs help, we just look at what's in that account, so that way it doesn't really disrupt what we're trying to do financially, and the goals that we're trying to achieve. There's a designated amount that goes in there every month, and currently has just been to help grand mom with some bills, and that's what we work with.

Bobbi Rebell:
It sounds like you've basically come to terms with you're just going to gift it.

Jen Hemphill:
Yeah.

Bobbi Rebell:
None of this lending to family, it doesn't work for you.

Jen Hemphill:
Yes, because then emotionally that's either get upset, “Oh, my gosh, we said we were going to lend it, we never got it back,” so I've learned and grownup.

Bobbi Rebell:
All right.

Jen Hemphill:
Over the years to really, when it comes to family, and friends, and when it deals with money, it's just a gift.

Bobbi Rebell:
But your money tip, your every day money tip is also about separating out funds, that seems to be a common theme for you-

Jen Hemphill:
Yeah.

Bobbi Rebell:
You want to talk about what you do at the grocery store, and how you can use apps for this.

Jen Hemphill:
Yeah. Basically, my money tip is, what we tend to do, let's say we're at the grocery store, and maybe we have some coupons, always strike up a sale, and we're winning. We celebrate, “Yes. I've saved X amount this trip,” but what's important here is, yes, we can celebrate the $20.00, or $10.00, whatever that amount is that we saved, but what are we going to do with that money? Because we're missing out if we're just celebrating it, that we saved that money, but we're not doing anything with it.

Jen Hemphill:
Literally, we have the bank up on our phone. Right? And with so many people having smart phones, you can download your bank app, and whatever that amount of money that you save, transfer it to your savings, or transfer it to pay off some debt. Whatever you deem is best in your situation. But doing that versus just leaving it in there, you know it disappears. That money doesn't have a job, if you will, it just disappears. We've seen it time and again. I know I've experienced it, I'm sure you Bobbi have experienced it yourself.

Bobbi Rebell:
Absolutely. All right. Let's talk more about your book. I'm so excited for you.

Jen Hemphill:
The book, oh, my goodness. The subtitle of the book is, The Missing Truths From Traditional Money Advice, so when we think of traditional money advice, we think about, we really hear, “Save more, spend less, and get out of debt,” but I know from my own experience, I had the financial books, I've read those financial books, I applied what the experts told me, and I was still finding myself stuck. In the book, I really share the lessons that I learned, and what I found out that really kept me stuck after doing all the things right.

Bobbi Rebell:
Awesome. Where can people find you?

Jen Hemphill:
Thank you. You can find all about me at jenhemphill.com. You can find the book there, or you can just go on Amazon, and just type in, Her Money Matters. It also has a companion workbook, because-

Bobbi Rebell:
I love that.

Jen Hemphill:
My audience wanted worksheets, and so they ask, I provide. Each chapter has some questions, some worksheets for you to work with, because essentially I want that to be your cheat sheet. If you're feeling stuck, go back to that work, and go back to that workbook, if you buy the workbook, and refer to that, because that's going to help you get out of that funk that you're feeling.

Bobbi Rebell:
I love that balance between emotional and then very specific practical tools. It's great. Thank you, Jen.

Jen Hemphill:
Thank you, Bobbi.

Bobbi Rebell:
Jen's story was a reminder that family really can be everything, however you define family. We should bend over backwards to help out the people that we care about in our lives. In Jen's case even though her brother-in-law did not pay back that loan, as time went on the asks for financial help from family did go down.

Bobbi Rebell:
Financial Grownup tip, number one, remember it's hard for people to ask you for help, so factor that in when deciding what to do when someone comes to you asking for help. If you are able to help them with their financial troubles, it's usually a better idea to just give them money. If you lend them money, it becomes yet another thing that they need to pay back in a very stressful time. Of course, it can also put stress on your relationship with them. They might avoid you. They might feel like you're judging them, if they buy something. It's better to just keep it clean, give them the money. You know what? Someday you may be in a position where you need their help, and they'll be there for you.

Bobbi Rebell:
Financial Grownup tip, number two. Jen talked about compartmentalizing money. Setting funds aside in different accounts for different purposes. This can be a great way to deliberately save for certain things like a slush fund for relatives that need help. Another thing that I have found can make a lot of sense to do is to put a certain amount of money, or allocate a certain amount of money, maybe on an annual basis to support friends, charities, causes that they care about.

Bobbi Rebell:
That way when people ask for you to support whatever they're involved in, it might be a charity run, or some other fundraising effort, a benefit, you can take the money out of that fund, and if at some point in the year, I mean, you got to be real, here, the funds could run out, you can tell them, “Look, I've completed my giving for the year, but I will send a donation in January.” People understand. Your resources are not unlimited even if your heart is.

Bobbi Rebell:
If you have not hit the subscribe button, please do so that way you won't miss any upcoming episodes of Financial Grownup, and of course you score extra bonus points with us if you rate and review the show. That way other people can learn about it, and be part of our community. Our first listener episode is coming up in June, if you want to be considered to be on an upcoming episode of Financial Grownup, email the money story, and the money tip that you would like to share to info@financialgrownup.com. We are going to see how it goes, and hopefully we'll be doing this once a month.

Bobbi Rebell:
A reminder, if you want to see the promo videos, they are sprinkled throughout our social media, and also we are putting them on our new YouTube channel, which is Financial Grownup, so you can easily just check them out there. You can also see our episodes there, you can listen to them I should say on YouTube as well. In social media, I am on Instagram, at Bobbi Rebell one, on Twitter at Bobbi Rebell, and on Facebook, Bobbi Rebell. Definitely DM me, give me feedback, let me know what you think about the show, let me know guests you want to see, and let me know which promo videos you like the best.

Bobbi Rebell:
Of course, speaking of the promo videos, as I said at the top of the show, if you want a promo video for yourself, share them, retweet them, repost them, and whoever does the most social sharing between now and the beginning, the first week of July, I'm going to make a promo video for you. Jen's story was a great one, all about doing our best for our family, and our friends, and the people that we care about in our lives, such an important topic, so thank you, Jen, for helping us get one step closer to being Financial Grownups ... Financial Grownup with Bobbi Rebell is edited, and produced by Steve Stewart, and is a BRK Media production.

Chris Browning, host of the Popcorn Finance podcast got a clean bill of health for his wife after a hospital stay a few years ago. But despite having been patients there before, a billing mixup left his credit score needing intensive care. 

Chris’ Money Story:

Chris Browning:
Yes so you know, unfortunately my wife, she had to go in for surgery and which is never a good thing. So we went to the hospital, everything got taken care of. She's all well now. We figured we'd just get a bill in the mail, that's how most medical bills come, they just send you something in the mail.

Bobbi Rebell:
Did they do any paperwork while you were at the hospital? Did you give them insurance information? What actually transpired at the hospital? Because you do usually fill out some stuff.

Chris Browning:
Yeah, so leading up, you sit in the finance office and they have you sign a couple of waivers and disclosures. And they say. "Alright, let's see your insurance". They took a copy and they said, "Okay we'll bill you". And that's literally all they told me. No further information other than that.

Bobbi Rebell:
And the hospital was in Network? Do you remember?

Chris Browning:
Yeah, it was an in Network hospital.

Bobbi Rebell:
So you were trying to be in Network, okay.

Chris Browning:
Yes, so we did everything we thought we were supposed to do and we visited the hospital before and the billing seemed to work fine, so you know we didn't even think twice about it. It felt normal.

Bobbi Rebell:
This might be important later on. You were in the system having visited the hospital before?

Chris Browning:
Yeah, it was a local hospital.

Bobbi Rebell:
Okay.

Chris Browning:
So we just thought, we'll get a bill in the mail like we have in the past. We waited around, nothing came after a couple of months and to be honest, I kind of just forgot about it, because it had been so long and it just never showed up.

Bobbi Rebell:
I would totally forget about it.

Chris Browning:
Yeah, after two months, you assume you would receive it. After that, life just goes on. You do other things. You live life. And so, I have this habit of checking my credit score, because one of my credit cards on their app, they allow you to check your credit score for free, and they'll update it like every seven days. And so I was just taking a look at it, and I noticed my credit score had dropped like a crazy amount. It had dropped about 150 points. That was very alarming, to say the least. And so I decided to take a look in my credit report. And I went to freecreditreport.com. I saw this like delinquency mark and I was like, that's strange. I remember paying all my bills.

Bobbi Rebell:
Right.

Chris Browning:
And when I looked into it, it just gave me just a random number. It didn't really give me a lot of details.

Bobbi Rebell:
Like a phone number?

Chris Browning:
Yeah, it was a random phone number from a ... it was an area code I'd never seen before. And so I gave the phone number a call, and then they gave me the details. They said this is from the hospital that we had visited, and they say you didn't pay your bill and it's been turned over to a collection agency. And this was the collection agency that I was speaking with.

Bobbi Rebell:
Wow.

Chris Browning:
I was just shocked and I was like, well how did this happen? And they have limited information.

Bobbi Rebell:
Sure.

Chris Browning:
And all they'd allow me to do at the time was they said, "Would you like to set up a payment plan?". And I was like, well yeah I want to get this cleared up. But I said, "Let me call the hospital first".

Bobbi Rebell:
Well right, and how do you even know they're legit. I mean they're saying they have the debt, but what exactly happened? Because you'd never heard from the hospital.

Chris Browning:
Exactly, so I was a little hesitant. I don't want to give you money just yet. So I called the hospital and got hold of billing department and I asked them. I said, "I see this delinquency on my credit report. They're saying that our bill was into collections, but we never received a bill in the mail". They said, "Well yeah, we mailed it out to you". And I said, "Well we haven't got anything for months". So they checked their system and they said, "Well here's the address we have for you", and it was the wrong address. They had transposed the numbers around, and who knows where the bill actually went.

Bobbi Rebell:
Which is crazy because two things. First of all, you had been to this hospital before, so presumably you were in the system correctly at some point because you had paid previous bills. And number two, any company, any person, we should all do it, but certainly a company, a hospital, should have a return address. So if they were going to the wrong address, you would think that they would return the mail, and the hospital would receive it back.

Chris Browning:
Exactly. You think they'd be some type of notification for them to know that whatever they mailed out just came back.

Bobbi Rebell:
And they never called you.

Chris Browning:
They never called.

Bobbi Rebell:
But presumably your phone number is on there.

Chris Browning:
Exactly, you'd think if they hadn't been paid all this time, they'd have at least called to follow up. But no. I think maybe it's just the sheer volume they deal with. They don't even try, they just immediately send it to collections after the time period had passed.

Bobbi Rebell:
So then what did you do?

Chris Browning:
So after I verified with them what collection agency they actually sent the bill to, and it matched the information they I had received from the number I had called, I called the collection agency back, because at that point, the hospital said there's nothing we can do. It's been sold to collections, you know it's out of our hands. I called the number back, I spoke with them. I said, "Yes, we want to take care of this". And I said, "If we pay this off, is there a way that this could be removed from my credit report, because it's a huge mark on my credit?".

Bobbi Rebell:
And it's also not your fault.

Chris Browning:
Exactly. Because I explained to them, I said we just never received the bill. I didn't know what type of pushback I was going to get. If they were going to say no. But surprisingly they said, Yes. If you set up, if you agree to a payment plan now, they gave me the total amount. It matched what the hospital said it should be. They said, if you pay this off, we will contact the credit bureaus and have the delinquency removed, because you've taken care of this.

Bobbi Rebell:
Of course. That's the least they can do. Did the hospital take any ownership of the fact that they had not followed up?

Chris Browning:
Not at all.

Bobbi Rebell:
That's disappointing.

Chris Browning:
They basically just said, sorry, nothing we can do. It's out of our hands and it was on me to take care of it.

Bobbi Rebell:
And it's foolish on their part because generally, and I assume this was the case when you send something to a collection agency, they're only getting a fraction of what the bill was. So they lost out for not bothering and not having the right systems in place to check with you. Presumably the doctor could follow up with you and your wife, so they had contact information that was correct in some part of the system.

Chris Browning:
You'd think that if they knew they're going to lose money, that it'd be in their best interest to do a little more follow-ups, spend a little more time, but no, they just I guess, just dump it off.

Bobbi Rebell:
Right, they lost money too. So that maybe there isn't the right stakeholder at the hospital that took ownership of the fact that that bill was not being paid for that reason.

Chris Browning:
Exactly.

Chris’ Money Lesson:

Chris Browning:
I would say first of all, make sure that you follow up on all your medical bills. Even if you think that the office is going to take care of it the way they should, you just never know. You could end up in the situation like this. So I do acknowledge that I could have called and followed up after a month of not hearing anything back.

Bobbi Rebell:
But maybe the insurance you were in Network, so if I was doing something in Network, I would have assumed that if I didn't get a bill, the insurance covered it.

Chris Browning:
I made that assumption too, but I think after this now, I'm going to be on the safe side.

Bobbi Rebell:
Of course.

Chris Browning:
I'm going to give them a call just to follow up if it's been like an unusually long amount of time since I haven't got any communication from them. Just to eliminate any issues or this ever happening again.

Chris Browning:
And the second thing I would say, check your credit score. I was really fortunate that that was a habit that I had picked up. You know we had been paying off some debts so I was in the habit of looking at my credit score to see how it was changing. That's the only reason I knew that there was any type of issue is because I saw my credit score had dropped drastically, and that triggered me to look at my credit report, and that's where I found the error, and I was able to finally take care of it.

Chris’ Money Tip:

Chris Browning:
So my money tip would be check with your credit card company, if you do have a credit card. Or even some banks. A lot of them offer access to your credit score and some even your credit report directly through their website or their mobile app. And so it's really simple. It's free a lot of the time and it's just a really convenient tool to have with you, and whether you're looking for errors or you just want to kind of track your progress. I think it's a really great incentive that these banks are offering to let you stay on top of your credit and your finances.

Bobbi Rebell:
And specifically, how often do you do that?

Chris Browning:
I've slowed down. I was a little obsessive. I was checking like every day at one point. Now I'm on a once per month basis. I'll log in, just kind of look and see how things are going, just I want to keep the practice up. I don't want to get too comfortable and let too much time pass, because who knows when an error could pop up.

Bobbi Rebell:
So when people check their credit score, what are the things that they should be looking for that are good and that are bad?

Chris Browning:
So I would say for sure, any type of drastic change. So if you've made this a habit and you're checking on a regular frequency, your credit score's not going to swing wildly. You know it's normal for it to swing 10, 20 points here and there. But if you see any type of drastic change, that would for sure be a trigger point to let you know you need to look into this a little bit more. Whether it's going to some place like freecreditreport.com which is run by Experian and you're getting a copy of your credit report just to see what's going on. Wild changes in any area of your finances is normally a sign of something that's not normal and that's maybe something you should look into a little bit more.

Bobbi’s Financial Grownup Tips:

Financial Grownup Tip Number One:

The only thing Chris did wrong here, he did not follow up in finding out what he owed the hospital. So the tip is to try to stay on top of your medical bills, especially the ones that you know are probably coming. Even if you're hoping they're not. That said, the visit was in Network, so Chris in all fairness could have believed there wasn't much to do except for a co-pay that he probably had already paid at the hospital. But at the end of the day, he himself says he should have checked in and been more on top of it. Mixed feelings about that though.

Financial Grownup Tip Number Two:

Don't assume that corporations or institutions such as hospitals are competent in their billing. Question everything. This especially goes sadly for end of life situations where the family is distracted and just wants to move on. Assuming you do get bills, try hard as it may be to go through them. I know of some instances where the bills were so out of control, literally offensive, that people have gone to the financing offices of the hospital and just negotiated them down on the grounds that no one could possibly go through every charge for an overpriced Bandaid or medication or whatever, and prove that it actually happened, was given and was priced correctly. Fairly, and fairly is pretty broad when it comes to our healthcare system. Hold them accountable. Just because they throw a list of a thousand teeny charges on a bill, doesn't mean you can't question it.

Episode Links

• Listen to and learn more about the Popcorn Finance Podcast

• Check your credit score!

Follow Chris Browning and Popcorn Finance!

• Twitter - @popcornfinance

• Instagram - @popcornfinancepodcast

• YouTube - Popcorn Finance 

Some of the links in this post are affiliate links. This means if you click on the link and purchase the item, I will receive an affiliate commission at no extra cost to you. All opinions remain my own.

Certified Financial Planner Manisha Thakor bonded with her dad over a love of the HP12C calculator and all of its investing tools. Now, the author of Get Financially Naked  shares her actual math formulas on how to lock in the right number for retirement and other goals. No excuses for listeners after this episode. 

 

In Manisha’s money story you will learn:

-The important role her father played in her early financial lessons

-How she bonded with her father over an HP12C calculator

-The specific way Manisha calculated different retirement investing outcomes as a tween. 

-The role inflation plays in the future value of investments

-The power of compounding

In Manisha’s lesson you will learn:

-Why Manisha feels women in particular need to focus not just on saving but also on investing

-The corrosive power of inflation

-Why we need to put  the recent period of historically low inflation in context

-How to manage your investments in times of extreme market volatility

In Manisha’s money tip you will learn

Manisha’s investing formula

1. Take the total dollar of your current savings and investment portfolios

2. Subtract out money you know you will need to spend in the next 5 years

3. For any of your long term money, like retirement, take 110 and subtract your age 

4. That is the amount that should be in equities

5. For example Manisha is 47. 

6. 110-47 = 63 percent should be in equities

 

In My Take you will learn:

-Why you do not need an HP12C calculator because so much is available online

-Exactly how to find out the status of your retirement accounts and if you are on track to reach your goals

-How and why you should automate your retirement savings. 

 

Episode links: 

Follow Manisha!

Twitter: @manishathakor

Facebook: Manisha Thakor

LinkedIn Manisha Thakor

YouTube: Manisha Thakor

Instagram Manisha Thakor

Pinterest Manisha Thakor

MoneyZen.com

Get Manisha’s books! http://www.moneyzen.com/books/

---

Transcription

Bobbi Rebell:
Support for Financial Grownup with Bobbi Rebell and the following message come from TransferWise, the cheaper way to send money abroad. Built by the brands behind Skype, TransferWise takes a machete to the hefty fees that come with sending money abroad. So don't get stung by a bad exchange rate or sneaky fees, join the two million people who are already saving with TransferWise. Test it out for free at transferwise.com/podcast, or download the app. It is the wise way to send money.

Manisha Thakor:
He showed me how to calculate how much money I would have by the time I was 65 if I invested my babysitting and my lawn mowing money, and then we did a couple scenarios. We tested how much I would have if I was earning 5% after inflation, if I earned 6% after inflation, and when I saw how big those numbers were I was just hooked.

Bobbi Rebell:
You're listening to Financial Grownup with me, certified financial planner, Bobbi Rebell, author of How to Be a Financial Grownup. You know what? Being a grownup is a really hard, especially when it comes for money. But it's okay, we're going to get there together. I'm going to bring you one money story from a financial grownup, one lesson, and then my take on how you can make it your own. We got this.

Bobbi Rebell:
We are geeking out here at Financial Grownup, but stay with me friends because you will have more money and be wealthier if you listened to this episode and follow my guest advice. Manisha Thakor is the author of Get Financially Naked, How to Talk Money With Your Honey. She is also the force behind MoneyZen, and is a practicing certified financial planner. If that sounds pretty cerebral, well, she will take that as a compliment. She started learning about investing very, very early. Here is Manisha Thakor.

Bobbi Rebell:
Manisha Thakor, welcome. You are a financial grownup. I'm so excited you're joining us on the Financial Grownup podcast.

Manisha Thakor:
I'm so excited to be here, and to be deemed by you a financial grownup.

Bobbi Rebell:
You're very much a grownup. You're the author of two books, On My Own Two Feet, and I love the second title, I know everyone does, Get Financially Naked. You also have MoneyZen. Lots going on.

Manisha Thakor:
I feel super excited about the world of personal finance and investing.

Bobbi Rebell:
Good, and I'm super excited about the story that you brought to share today, because it has to do with some father-daughter bonding around, not the dinner table, around the HP 12C calculator.

Manisha Thakor:
I love this. When I was around 11 years old, my dad, he's an MBA and a CPA, he sat me down in a moment of father-daughter bonding that only financial geeks, like ourselves, could really appreciate. He had an HP 12C calculator, which for folks who may not be familiar with it, is a financial calculator that enables you to do sophisticated compounding calculations on it.

Manisha Thakor:
He showed me how to calculate how much money I would have by the time I was 65 if I invested my babysitting and my lawn mowing money, and then we did a couple scenarios. We tested how much I would have if I was earning 5% after inflation, if I earned 6% after inflation, if I earned 7% after inflation, and when I saw how big those numbers were I was just hooked.

Manisha Thakor:
That was really my first introduction to the power of compounding, and I think because he had my physically touching the buttons on the calculator, and then he made me write down the numbers in a little grid on a notepad. I can literally still even remember what the notepad looked like. It was so tactile and so visual.

Bobbi Rebell:
Do you have the notebook still?

Manisha Thakor:
You know, I wish I did. He and I both say in retrospect, "We totally should have saved that for the grandkids," but it's in my mind's eye. That's how I got hooked on saving and investing.

Bobbi Rebell:
So then what is the lesson for our listeners? Should everyone be bonding over calculators?

Manisha Thakor:
That's right.

Bobbi Rebell:
We know that's not going to happen.

Manisha Thakor:
No, I-

Bobbi Rebell:
Let's bring it down to a realistic level.

Manisha Thakor:
The lesson for me, and the lesson that I want to scream from the mountain tops, is, and particularly for women, is that it's not enough to just save money. Saving is great, and it's freaking hard to do, but you must invest it as well, first and foremost to offset the corrosive power of inflation.

Bobbi Rebell:
Which is picking up by the way, so that's something we need to start being more aware of, and a lot of young people haven't really seen inflation at the level that other generations have. But it is going to become a bigger part of our dialog.

Manisha Thakor:
Yeah, and Bobbi, you've nailed it. We've just gone through such a bizarro period of de minimis inflation. An example I love to give is 100 bucks over a 30 year period at 3% inflation is worth $40, was, at the beginning. If you just increase that inflation to 5%, which doesn't sound like a big jump, but that drops the value of $100 in 30 years to what $20 would have bought.

Manisha Thakor:
So small [inaudible 00:05:54] inflation have a huge, huge impact, and that's why you cannot just save. You have to invest, because the first step of investing is keeping your money growing at least with the rate of inflation. If you do investing well, then ideally over the long run you grow your portfolio even faster than inflation, which increases your real purchasing power.

Bobbi Rebell:
Okay. Now for your money tip, Manisha. We're geek out even more, because you have actually brought a formula. Your, Manisha's, magical formula for investing success. I promise everyone, just stick with us, she says it really well. She's going to explain it all, and we're going to have it all written down in the show notes for you as well. Go for it.

Manisha Thakor:
The way I think about how to take your hard earned savings and invest it is the following. First, take a look at the total dollar value of your current saving and investment portfolios. Second, subtract out any money you know you need to spend in the next five years. This could be money you need for a home down payment, or it could be your six month emergency fund.

Manisha Thakor:
Then, for any of your long term money, which for most of us is our retirement money. So it's any money that you know you don't have to spend in the next five years. What you do, is you take 110, and you subtract your age to get a back of the envelop estimate of what percent of your portfolio should be invested in stocks. That was a mouthful, and Bobbi, as you mentioned, it will be in the show notes, but I'll give you an example.

Manisha Thakor:
I'm 47 years old. We'll round that down, because at my age you like to round down. To keep the math easy, 110 minus 45 equals 65. So a good starting point for me, for how much of my long term money at my age should be in stocks, is 65%. Lo and behold, that's how much I have of my long term money in stocks.

Manisha Thakor:
The biggest mistake that I am seeing with young people these days is shying away from investing their savings, because they're afraid of losing money. So they're missing those vital early years of compounding. That's why it's so important that you subtract out the money you need to spend in the next five years, so no matter what the market is doing, you're fine. The money you know you needed, it's in cash. It's only your long term money that's being invested.

Bobbi Rebell:
I think a lot of young people witnessed their older siblings, or their parents, really being burnt in the recession, and that's a lot of the hesitation.

Manisha Thakor:
I'll just say, Bobbi, when I hear somebody tell me that 2007 to 2009 ruined their retirement, what I say is, "No. Either you had the wrong asset allocation going into it, or you blink and you deviated from your plan." Because if you followed the formula that I'm saying, and you didn't have any money that you needed to spend in the next five years in the market, in 2007-2009, you would have seen your portfolio drop as much as 50%, but you wouldn't have sold a single share of anything, because you didn't need to touch it, and then you would have seen your money double or triple as you came out of the recovery.

Manisha Thakor:
So the people who lost in 07-09, where the people that were forced to sell at bottom to maintain their lifestyle, or got scared because they didn't have the cash cushion, and sold at the bottom. That's why this formula is so important.

Bobbi Rebell:
Right, and you've got to sit tight. Even the beginning of 2018 we had some scary days. You've got to know your focus and stick with the plan. All right. Mrs Manisha, I also hear you have big news, new projects, new jobs. Tell us.

Manisha Thakor:
I'm so excited. I have just accepted the role of vice president of financial education for an amazing firm called Brighton Jones. I could not be happier. When I think about what I want to accomplish in this world, my belief is that money is power, and women need more of both.

Manisha Thakor:
And so I am going to be doing my darnedest in this new role to help women achieve that. As part of that, I'm really going to be ramping up my efforts with my MoneyZen newsletter. So if listeners are interested, I encourage you, go to my website, moneyzen.com. I'll have a monthly newsletter that I'll be putting out. It's educational, and I'm really going to be working hard to share the most vital resources, articles, tools, each month around women's economic empowerment, and how we can all use personal finance and investing to increase our voices and choices. I always say, "Money gives women, it gives everyone, voices and choices," and financial education, and financial guidance are what helps unlock those doors.

Bobbi Rebell:
Awesome. Before I let you go, where can we find you on social media?

Manisha Thakor:
My name is a mouthful, and I'm the same handle on everything. I'm ManishaThakor everywhere. It's M-A-N-I-S-H-A-T-H-A-K-O-R, on Twitter, Facebook, LinkedIn, Instagram. If you forget that, go to moneyzen.com, because I have all my social media icons right up at the top.

Bobbi Rebell:
All right. Thank you so much for joining us.

Manisha Thakor:
Bobbi, always a pleasure to chat with you.

Bobbi Rebell:
As warned, Manisha and her dad totally geeked out with all that math, but the good news is, you guys don't need to go out and buy yourself fancy HP 12C calculators and do all this kind of fancy math, because these days it's really all there for you.

Bobbi Rebell:
Financial grownup tip number one, there is nothing more powerful than seeing the numbers. And like I said, you don't even have to do the math yourself these days. Log into your HR website from your job, or if you work for yourself and you have retirement accounts, which you should, go there. Go to the provider, and just take a look. Most of them will have nice calculators. They'll do the math for you. They'll have probably some graphic ways to show you how you measure up, where you are relative to your retirement goals.

Bobbi Rebell:
You can actually see how you stand, and see how you feel about it. You might get pretty emotional. It could be a really emotion. You might doing pretty well. It could possibly be not that great, but maybe that will motivate you. But the important thing is, get the information, it doesn't take much work, and make decisions from there.

Bobbi Rebell:
Speaking of decisions, financial grownup tip number two. While you're on that website, look at the retirement savings, and look for a box that says, "Increase your withholding," or a box you should check that says, "Increase your withholding by 1% every year," and of course check that box.

Bobbi Rebell:
Now, you can always undo it, but by checking that box it will automate increasing the amount of money that you are putting away each year, and you probably won't feel it because it's tax deductible, so it won't cost you that full amount, and it will amplify your savings.

Bobbi Rebell:
We have been hearing a lot from you guys, wanting to share your own financial grownup money stories, lessons, and money tips. So we are going to start having one guest a month be a listener. If you want to be considered, email us at info@financialgrownup.com, and tell us, what is the money story that you would like to share, and what is the money tip that you would also share with us, if you are chosen.

Bobbi Rebell:
Subscribe if you have not already, and help us spread the word by sharing on social media. I am @BobbiRebell on Twitter. Follow me, and please retweet these silly promo videos I'm doing. They're a lot of fun. I enjoy making them. Hopefully you guys are going to enjoy seeing them, if you have not already. Help us reach more listeners. On Instagram I am @BobbiRebell1, you can also repost those, and go to bobbirebell.com/financialgrownuppodcast to learn more about the show, and sign up for our mailing list so you can hear about things like how to be guest on the show. I hope you enjoyed Manisha's story, and that we all got one step closer to being financial grownups.

Bobbi Rebell:
Financial Grownup with Bobbi Rebell is edited and produced by Steve Stewart and is a BRK Media production.

Doug Boneparth  CFP®, author of The Millennial Money Fix,  got his entrepreneurial game on early in life when at just 15 he was selling Japanese Anime video’s on a new platform- eBay. While the business did not last, the lessons about supply and demand, as well as keeping track of the profits, provided the foundation for the entrepreneur he is today. 

In Doug’s money story you will learn:

-Why checks were arriving in the mail for the then 15-year old Doug Boneparth

-How Doug leveraged his passion for Japanese Anime into a thriving online business just as the internet was becoming a mainstream tool for commerce

-The skills Doug and his brother developed to grow the anime business, and other businesses they started

-How much money Doug made

In Doug’s money lesson you will learn:

-How Doug’s passion for his product drove sales

-How Doug has used the lessons from that teenage business to build his current CFP® practice

-How Doug continues to leverage the internet for business

-Why it is important to understand the legal ramifications of business decisions

-Where the profits from his business went!

In Doug’s money tip you will learn:

-How to make your commute more productive

-The financial and psychological benefits of investing in improving your time between home and work

 

In my take you will learn:

-The importance of tracking your business spending and costs, in addition to top line income

-How saving money in the wrong places can hurt both your business, and the quality of your personal life

-The specific, and very tough decision Bobbi made to increase her intentional work time, in order to improve the quality of her time with her family. 

 

Episode Links

Doug Boneparth’s Bona Fide Wealth Website: https://bonefidewealth.com/

Get Doug’s book The Millennial Money Fix

Follow Doug!

Twitter @dougboneparth

Instagram @Dougnotsofunny

Facebook Bonefidewealth

LinkedIn DouglasBoneparth

---

Transcription

Bobbi Rebell:
Support for Financial Grownup with Bobbi Rebell and the following message come from TransferWise, the cheaper way to send money internationally. TransferWise takes a machete to the hefty fees that come with sending money abroad. Test it out for free at TransferWise.com/podcast or download the app.

Doug Boneparth:
I remember my dad and my mom kind of wondering, "Well, why are all of these checks coming in the mail?" Eventually, I think eBay was a little suspect as to what I was doing, as well. My parents were a little suspicious. My dad, I think, stopped bringing my boxes for shipment to the post office.

Bobbi Rebell:
You're listening to Financial Grownup with me, Certified Financial Planner, Bobbi Rebell. Author of How to Be a Financial Grownup. And you know what? Being a grownup is really hard, especially when it comes to money. But it's okay. We're going to get there together. I'm going to bring you one money story from a financial grownup, one lesson, and then my take on how you can make it your own. We got this.

Bobbi Rebell:
Hey, friends. Certified Financial Planner and Author of The Millennial Money Fix, Doug Boneparth, was born to be an entrepreneur. He started building businesses in his teens. Doug was hesitant to share the story you're going to hear because, well, it was the early days of the internet. And let's just say the rules were still unclear. That aside, it is a great lesson in taking something you love, knowing the market, and then filling a demand by creating supply.

Bobbi Rebell:
Here is Certified Financial Planner, Doug Boneparth. Doug Boneparth, you are a Financial Grownup. Welcome to the podcast.

Doug Boneparth:
Thanks for having me.

Bobbi Rebell:
One of my favorite CFP friends, and also, by the way, congratulations on your still relatively new book, The Millennial Money Fix. We're going to talk more about that soon. But first, I want to get to your money story. It's a really good one. We've been talking about this.

Doug Boneparth:
It's a throwback.

Bobbi Rebell:
It's a throwback to when you were 15 years old. Anime was a big thing. You learned about the markets with a little business venture. Tell us.

Doug Boneparth:
So self-admitted super dork here. In high school-

Bobbi Rebell:
No.

Doug Boneparth:
I really kind of got into Japanese animation. I thought it was awesome, and one thing that I noticed was, it was becoming more and more popular in American culture. I think Cartoon Network had Toonami and it was something I just loved. I loved all these things, video games. Of course, Japanese animation. I was really good with computers. My brother and I were both really good with computers, and I always was able to find a way to surf the internet a little bit better than others. So I said, "Geez, if we could find a way to get some great shows, these anime shows and sell them, we could probably make some money."

Doug Boneparth:
I noticed the demand in this relatively new market in the US and I did just that. I found a number of series, back from like the '80s. I think CD burners were relatively new, and eBay was relatively new, so what did I have? I had a market, I had a way to distribute, I had a way to capture content, and I was in business, and the checks came in.

Bobbi Rebell:
How much were the checks, Doug?

Doug Boneparth:
Each series, in the beginning, and what was really interesting is I watched the price of these series come down pretty dramatically over the course of like six months. But checks were 80 bucks, 70 bucks for a particular show.

Bobbi Rebell:
And you're how old again?

Doug Boneparth:
I was 15.

Bobbi Rebell:
15, okay.

Doug Boneparth:
Yeah, so here I was, thinking I had a really cool idea. I remember my dad and my mom kind of wondering, "Well, why are all of these checks coming in the mail?"

Bobbi Rebell:
Oh, they didn't know what was going on?

Doug Boneparth:
Well, no. They really didn't. They knew like I was savvy with computers, and I was into these shows, but they let me. I was a good boy. They left me to my-

Bobbi Rebell:
How much money, Doug, was coming in exactly? How much? What was your haul here?

Doug Boneparth:
I think from beginning to end, I had to have cleared $10,000 in checks.

Bobbi Rebell:
Oh, my gosh.

Doug Boneparth:
Yeah, it's a lot of money for a 15 year old, and the worst part is, I have no idea what I did with it.

Bobbi Rebell:
Oh, no.

Doug Boneparth:
I know. I'm sure I spent it on like candy, and video games, and computer equipment, and again, real dorky stuff. But, yeah. It was cool and I felt like I was running this amazing enterprise, where I had really tapped into something that was becoming popular. But those checks eventually dwindled, and eventually, I think eBay was a little suspect to what I was doing, as well.

Doug Boneparth:
My parents were a little suspicious. My dad, I think, stopped bringing my boxes for shipment to the post office, which was right outside his office. And that was the end of my borderline questionable anime sales and marketing job on eBay.

Bobbi Rebell:
Was there a talk that your parents had with you and your brother? By the way, so your brother's involved in this, too, I assume?

Doug Boneparth:
Oh, no. No, he remains innocent. I remember my dad pulling my brother aside and asking, "What is your brother doing?" I think my brother covered for me pretty good. He goes, "He's putting these shows on CDs, I think they're so old that nobody cared." And my dad kind of looked at him strangely and I think that was the end of him kind of sponsoring or being my mule to bring the series to the post office. Yeah, quasi unethical behavior perhaps at 15.

Doug Boneparth:
Hey, look. Kids are going to get in trouble and it's probably a good reminder to let those who are trying to become entrepreneurs early on, make sure what you're doing is completely legit, like the computer repair business. My brother and I were running, that seemed to be probably a little bit more above board. But it was a great learning lesson. It kind of fanned the flames of the entrepreneur in me and only led to greater success down the road.

Bobbi Rebell:
It was the early days of the internet, so the rules were not clear yet, to be clear in terms of you were a 15 year old kid. You certainly were not intentionally doing anything that was not above board.

Doug Boneparth:
Yeah, no. I thought it was extremely clever. I thought it was amazing that this could all be put together. And if I was smart enough to do it, then to the victor go the spoils. Now looking back at it, yeah, it maybe a little bit dicey.

Doug Boneparth:
But again, I kind of wear it with a badge of honor, and have more value from the lessons that I learned in doing it and in business, than really just about anything else. But, yeah. You got it. Probably walking a fine line there.

Bobbi Rebell:
From an entrepreneurial standpoint, from a money standpoint, what did you learn running this internet business at age 15? I mean, were there marketing [inaudible 00:06:37]? Because you did well.

Doug Boneparth:
Yeah.

Bobbi Rebell:
You did really well.

Doug Boneparth:
Yeah, I learned that if you can sell something that you're excited about and you're passionate about, it's almost like not working. And that's a really important lesson. And that holds true as an advisor. My friends don't want to hear how I love Monday. I do. I absolutely love what I do, in the same way that I loved what I was doing. I loved these shows, and the stories, and I thought that I was sharing them with other people in this new trend that was emerging. That was super cool. So that was lesson number one.

Doug Boneparth:
Two was really an economic lesson, and looking at something here that I saw the trend. I saw the demand. I had an ability to supply it. And sure enough, you put those two concepts together and you're in business. And then third, is the internet side of things. Again, this is kind of the dawn of the eCommerce. This is the beginning of the internet. I thank my parents for allowing my brother to get a broadband cable modem and to be able to do a lot of cool stuff out there.

Doug Boneparth:
And I think the lessons and the experience I had there followed through to even how I'm operating business today. A lot of the way that I market my firm is definitely on the internet side of things, so I was an early adopter. And those are my three big lessons from being an entrepreneur at the age of 15. Even if it was selling Japanese animation on eBay.

Bobbi Rebell:
I hate to ask you this, but the $10,000. You really have no idea where it went, Doug?

Doug Boneparth:
All right.

Bobbi Rebell:
Because I know people want to know.

Doug Boneparth:
Fourth lesson. Become financially literate and responsible, and I only ... This is where I'm haunted by, "What if I had bought some really cheap technology stocks back in the day?" Or something like that, I'd be swimming in it, right?

Bobbi Rebell:
$10,000 at age 15, Doug. Where did it go?

Doug Boneparth:
You tell me. Where didn't it go? I always had a lot of fun, and I really liked video games, and computer, I probably just ... I'll tell you where it went. It went into computers, and hardware, and things like that. Again, you're having me admit just how big of a nerd I was.

Bobbi Rebell:
But that's investing back in the business.

Doug Boneparth:
No, that was to play video games, and get like cool graphic cards, and buy video games, and stuff like that. No, it was-

Bobbi Rebell:
I was trying to help there you there, Doug.

Doug Boneparth:
No, no, no. I appreciate that, but there's no, really no helping me on that one.

Bobbi Rebell:
So let's talk about your money tip. This is a good one. You struggled with this, but I think it's a really good one. Because so many people spend so much time on their way to and from work. Hopefully they're listening to podcasts like this one while they do it. But it's important to really prioritize this time and think about it as an asset. And you have a money tip to that end.

Doug Boneparth:
That's right. When you're thinking about commuting, I think that you should pay for the things that free up your time. So for me, that's parking across the river in Jersey City, so there's a car that can get me to my daughter or home a lot faster. And therefore, I can be more productive with my time.

Doug Boneparth:
It's paying for things like your 4G internet, for your laptop, so if I do take the train or I'm not driving, I can work and be productive. The theme here is, I usually don't hesitate to spend money on things, like parking or internet, things that make me become more productive when I'm commuting. It's usually a good payoff.

Bobbi Rebell:
All right. Sounds good. Let's talk a little bit about The Millennial Money Fix. This is a great book. It's very comprehensive, and yet to the point. Tell me more.

Doug Boneparth:
So there are a lot of personal finance books out there, and I hope that the stories are what differentiate one book from another. And this is A, 80% of what you should have learned about in personal finance, right here in like 200 pages. Extremely digestible, but B, it's a first-hand perspective of what it's like for two hardworking millennials to navigate their young adult and now more mature adult lives in a way that's relatable and practical.

Doug Boneparth:
We know what hundreds of thousands of dollars in student loan debt looks like. We know what it's like to buy a home, and start a family, and have kids with that burden. And we know how hard you have to work to make these things happen. So we practice what we preach and we want to share our story. My wife, Heather, and I want to share our story with everyone, so they become financially educated, empowered, and go after their great things in life.

Bobbi Rebell:
And also, of course, people look at you. You're a very successful Certified Financial Planner. You're all over the media, so prominent. But you have the same challenges that so many people do have.

Doug Boneparth:
That's right. If you judge a book by its cover, you might say to yourself, "Well, there's nothing these two really need to worry about. They're doing really well for themselves." And that's false. I mean, yeah, we're doing really well-

Bobbi Rebell:
You're doing well, but it's not all roses.

Doug Boneparth:
Yeah, exactly. Nothing's been handed to us and our debt was something that we took on ourselves through Heather's own decisions to go to law school-

Bobbi Rebell:
You went to graduate school, too.

Doug Boneparth:
I went to graduate school, too. But I willingly knew what the impact would be. She did not have that advantage, and that's actually a cool contrast that we provide in the book. What it's like to pay for an expensive education, knowing fully well what it means financially, as well as what it means to pay for that education, not being financially literate. And I think that's something a lot of young people are going through, the older millennials.

Doug Boneparth:
And I think it's an opportunity for younger millennials, and even Gen Z to use this as a cautionary tale. Know what it is that you're getting yourself into, and how to find that return on your investment, and set yourself up with lessons that you should be learning, but unfortunately, aren't offered to you. So we're going to provide-

Bobbi Rebell:
Well said. And where can people find you?

Doug Boneparth:
People can find me so many places. So many places. BonafideWealth.com's website. You can follow me on Twitter @DougBoneparth. Facebook. Just Google Douglas Boneparth and take your pick.

Bobbi Rebell:
All right, and YouTube especially. Check out his YouTube channel. It's awesome.

Doug Boneparth:
Especially for young financial advisors, that's for you.

Bobbi Rebell:
Absolutely. All right, Doug. You've been such a pleasure. Thank you so much.

Doug Boneparth:
Oh, thank you.

Bobbi Rebell:
Here's my take on Doug's teenage entrepreneurial venture. Financial Grownup tip number one. You guys may have noticed I didn't want to let Doug off the hook about his profits. It was $10,000, he was only 15, so we are going to give him a pass. But if you are bringing in cash, you need to have a system, any system. Whatever works for you. There's a lot we don't know about what was going on with Doug's business.

Bobbi Rebell:
We don't know if there was overhead, probably not. We don't know who was paying, for example, for his shipping costs. Probably his dad, so it was pure profit. So $10,000, he enjoyed it, he was 15, but if you want to be a Financial Grownup, figure out what's going on with your cash flow, and be more deliberate, and more intentional.

Bobbi Rebell:
Financial Grownup tip number two. Doug talked about spending money to make your commute and your life more productive. He focused on logistics, like parking, and having internet wherever he goes. And that is a great point. Spend money on productivity, so you can complete more work more efficiently. For example, this is something I've come to realize. I will sometimes cut my workday short to pick up my son from school. That can be as early as 2:30 in the afternoon some days. On a personal level, that's great.

Bobbi Rebell:
But sometimes it's a mistake because it can cut hours off my workday, when I could simply pay a babysitter just to pick him up and get those hours back. Then I can be focused on my son when he is home because I have completed my work. Racing to get him and then ignoring him because I have to get work done is not a win for either of us.

Bobbi Rebell:
Thank you all for listening to this episode of Financial Grownup. Don't forget to hit that subscribe button if you have not already and be in touch. Follow me on Twitter @BobbiRebell, and Instagram at BobbiRebell1 and learn more about the show at BobbiRebell.com/FinancialGrownupPodcast. You can also get our newsletter there and find out how you can be a guest on the show. I hope you enjoyed Doug's story and that we all got one step closer to being Financial Grownups.

Bobbi Rebell:
Financial Grownup with Bobbi Rebell is edited and produced by Steve Stewart and is a BRK Media production.

John Schwartz, NY Times correspondent and author of the new book “This Is the Year I Put My Financial Life in Order” shares the story of his first home purchase, how it brought him to the brink of bankruptcy, and why he flosses every day. 

In John’s money story you will learn:

-How John’s seemingly solid real estate investment went downhill

-How the rights of tenants can put owners in losing positions

-The specific financial steps John took ahead of a likely bankruptcy filing

-The factors that went into John’s decision about bankruptcy

In John’s lesson you will learn:

-Why John says failure is not the end of your financial life

-How John and his family rebuilt their life

-The specific steps John took to financially protect his second home

-What he would and would not have done differently in buying real estate

-The impact of a broad-economic downturn on individuals like John, and how you can create some protection as a home owner

In John’s money tip you will learn:

-The one health tip that John says will save you a ton of money

-The importance of daily health habits to avoid massive medical bills

-How his life informed his book “The is the Year I Put my Financial Life in Order” and how the book came together

-Why John did not have a will until his late 50’s

-John’s advice on retirement savings

In my take you will learn:

-Real Estate is a high stakes game, that should be entered into with eyes wide open

-My take on what John could have done differently

-The choice my family made to avoid investing in a property that would be hard to sell

-Why I still believe owning real estate is a great opportunity, despite the tax law changes

Follow John!

Twitter: @JSwatz

Facebook: This is the Year Schwartz

 

 

Buy John’s book!! : This is the Year I Put My Financial Life in Order ! 

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Transcription

John Schwartz:
My father-in-law said, "You have to file for bankruptcy." I contacted a couple of bankruptcy lawyers and the one that I ended up with said, "You don't need to file for bankruptcy, you need to get out from under the single debt that's killing you."

Bobbi Rebell:
You're listening to Financial Grownup. With me, certified planner, Bobbi Rebell, author of How To be a Financial Grownup. You know what? Being a grownup is really hard, especially when it comes to money, but it's okay, we're going to get there together. I'm going to bring you one money story from a financial grownup, one lesson, and then my take on how you can make it your own. We got this.

Bobbi Rebell:
Hey everyone, before we get into today's interview, I want to do a quick thank you to all of you for supporting the show. Our numbers are going up, which is really cool. The show is being discovered and I have all of you to thank for it. I also want to thank some of our friends in the media that have highlighted Financial Grownup, including Forbes, which named Financial Grownup one of five podcasts that are getting it right. We were up there with some really big names like TheSkimm and Masters of Scale with Reid Hoffman and Powderkeg and a Rent the Runway related show, so it was pretty incredible to get that recognition.

Bobbi Rebell:
I also want to thank Business Insider for highlighting our recent episode with The Muse's co-founder Kathryn Minshew. Her story is pretty incredible, so I'm glad more people got to learn about it. Thank you to all of you and I hope you guys are enjoying the show. Okay. Now to the show. Many of us bring our A game to our professional lives. I certainly try to, but then we don't always make the effort at home. Think of the chef that whips up these gourmet, amazing meals at their fancy restaurant, then they go home and they can barely scrounge together maybe a grilled cheese or some leftovers. Who knows? New York Times correspondent, John Schwartz, is that guy. No, he's not a cook. He's obviously a journalist, but he does research for a living.

Bobbi Rebell:
He's written four books and he's also been a journalist at a number of prestigious publications. Right now, as I mentioned, he's at The New York Times, but in his personal life, he messed up and it cost him, and it kept costing him for years. It was really bad. But, the story of the author of his new book, This is the Year I Put My Financial Life in Order. Sensing a theme here, he got it together. Does have a happy ending. Just maybe not what you were thinking. Here is John Schwartz. Hey John Schwartz, you are a financial grownup. Welcome to the podcast.

John Schwartz:
Well, thanks it's great to be with you.

Bobbi Rebell:
Congratulations. Your new book, This is The Year I Put My Financial Life in Order is coming out right now. I whipped through this book by the way in a day and a half, which is pretty amazing, cuz I can be a bit of a procrastinator, but I couldn't put this down. It was a great book.

John Schwartz:
God, I'm glad to hear that. Thank you so much.

Bobbi Rebell:
How long did it take you to write it, by the way?

John Schwartz:
It was a little more than one year.

Bobbi Rebell:
I brought that up, because within the book is this gem of a money story that, I don't know, at first when you told me it I was disappointed in you, but when I read it in the context of the book, I respected you and I felt like, wow, this could happen to anyone. Tell us your money story.

John Schwartz:
Well, we bought an apartment in New York, which is either a success story or the beginning of a horror story. In our case, it turned pretty bad, because I got a job in another city.

Bobbi Rebell:
Which should be good-

John Schwartz:
Which should be good. Again, career advancement? Exactly. But, we got there and not only could I not sell the apartment in New York, because we had bought at the top of the market, but when we had a tenant, which also seemed like a pretty good idea, that tenant decided to stop paying. And, knew his rights, as he told me over the phone. I was either gonna have to spend a tremendous amount of money on lawyers to get him out or as the super in the building suggested, kill him.

Bobbi Rebell:
Yeah, no.

John Schwartz:
No, exactly.

Bobbi Rebell:
He is alive and well. Let's just make that clear.

John Schwartz:
Right. Well, at least, last I checked. Then, over time all our savings were gone. We were faced with near bankruptcy and ended up defaulting on the apartment and losing it. As a little side note, that apartment's worth more than a million dollars today.

Bobbi Rebell:
Wow. Can you give us some of the numbers involved and how this happened?

John Schwartz:
Well, it was $136,000. I believe, it might have been 138, my memories not perfect. We were able to pull together the down payment in part, because my wife had a little inheritance from her grandfather and I'd been making pretty good money at Newsweek. We were able to make the payments, but we were not able to make those payments and pay our rent in Washington. That's where the money really started to kill us.

Bobbi Rebell:
And the tenants weren't paying.

John Schwartz:
And the tenants were paying nothing. Well, we have the first tenant, I finally got him out at the suggestion of a very kind lawyer who said, "Send him a letter telling him that you won't pursue him legally if he just leaves."

Bobbi Rebell:
So, you forfeited money.

John Schwartz:
He was never gonna pay. I was gonna spend more money pursuing this guy in court and the lawyer, very intelligently said, "Don't throw good money after bad. Just see if this is enough of an incentive to get him out." It was and he left. Then we got the next tenants in. Again, just as with the first guy, we did a credit check, looked good. We tried to do eyes open transactions here. The second couple was very nice, but a few months in the woman called me and said, "My husband's left and I can't pay." I said, "Okay. Get out." That's when my father-in-law said, "You have to file for bankruptcy."

John Schwartz:
I contacted a couple of bankruptcy lawyers and the one that I ended up with said, "You don't need to file for bankruptcy. You need to get out from under the single debt that's killing you. Everything else, you're banking all your other payment. You're living right, but you have this one unsustainable debt, this mortgage." He walked me through the default process.

Bobbi Rebell:
What is the lesson for our listeners here?

John Schwartz:
The first lesson is failure, really crushing failure, as much as it hurts, is not the end of your life. It's not even the end of your financial life. We went through this, more than 20 years ago. You gotta imagine I was devastated by it, but over time we were able to rebuild. Before doing the default, I had been able to get a mortgage on a place in Maryland. So, we had a home that we could not lose.

Bobbi Rebell:
So you were smart with your timing. You did this very thoughtfully. You didn't just let it default. You thought, "Okay, before we let this happen, what financial things can we put in order?"

John Schwartz:
Right. How can I fix this to the extent that I can fix it? So, we were in the house. We went through the process on the other place. It was our new beginning and that's the message. That you can take failure and turn it into the next step of your life. In fact, when we sold that house five or six years later, we were able to sell it at twice the purchase price. Now, we bought it, it was a wreck and we really had to fix it up. That's-

Bobbi Rebell:
You put in the work.

John Schwartz:
... sort of the way we do things. We put in the work and we found a place that was seriously underpriced in the market. Largely, because it was such a wreck, but that turned around everything for us. We went from total failure to in a house, to a pretty good success.

Bobbi Rebell:
I love a happy ending. Looking back though are there things that you would have done differently or looking back, it just happened. Would you have not taken the job in Washington had you known what a debacle the New York apartment would be or really, it just happened and this is the way your life is?

John Schwartz:
I think I could have done things more intelligently. The way that I was looking for an apartment was more about feel than really working through the numbers and understanding what I was up against. I didn't know and might have been able to figure out that this apartment, which was part of a co-op conversion was happening in a building where the for rent apartments were not shifting to co-ops quickly enough.

John Schwartz:
One of our big problems was that we couldn't sell it, because banks didn't want to lend money in a down market in an undersubscribed co-op. Now, those were things I only learned after the fact, but wouldn't it have been smart to learn them before putting money down? Research counts. I mean, I do research for a living, right? I do the research and I type.

Bobbi Rebell:
Your job, but not your personal life sometimes. That's what happens to all of us, right?

John Schwartz:
That's right and that's the story of this book. Learning to do for myself what I do in my job.

Bobbi Rebell:
Part of my enjoyment in reading this book was getting some of your little tips in life. Tell me the money tip that you are gonna share with us that everyone can put in place. Hopefully, they're already doing it, but it actually is a money tip even though people may not think of it that way.

John Schwartz:
Okay. If you're ready for this, it's flossing. Now I sound like that dentist from Sesame Street. Could I just say a few words about flossing? Flossing's important not just because it helps keep your gums healthy and all that stuff, it is something that I started to do in my late-20s regularly, after I had a bout with a periodontal condition. I needed a procedure. After that, there was not a day I missed flossing.

John Schwartz:
What flossing does, more than helping your gums, but I'll get back to that. Is that it establishes a daily habit. Establishing daily habits is the foundation stone for all sorts of good things. If you can floss every day, then you can exercise every day, if you can find the time. Then you find how to make the time. If you can exercise every day, maybe you can save a little money.

John Schwartz:
You can show discipline in other parts of your life, but even more than that, your teeth and gums are gonna be healthy. You're gonna have a much smaller chance of running into the kind of mouth problems that I had in my late-20s, which are expensive. Even if you've got insurance, you've got deductible and everything else. It's part of using good habits to prevent, preventable problems.

Bobbi Rebell:
It all goes together. The book, This is The Year I Put My Financial Life in Order. I love it. Tell our listeners a little bit more about it.

John Schwartz:
Well, it's coming out on April 3rd. It is part guide and part memoir, which is a sort of weird blend, but you know. Reese's put together chocolate and peanut butter and that worked. The idea is that I put my financial life in order by applying research to the problems of my life and the issues that were still undone. Like, I was in my late-50s and I didn't have a will, which is idiotic. I hadn't looked at my retirement to understand whether I was gonna live comfortably, or whether I needed to do more, whether it was a disaster.

Bobbi Rebell:
But you are okay, by the way.

John Schwartz:
Yes.

Bobbi Rebell:
Spoiler alert. You're fine.

John Schwartz:
Yes, spoiler alert.

Bobbi Rebell:
Good to hear.

John Schwartz:
Largely because I started putting money away in my 20s. The first time I got a significant raise, I opened a 401k and put the money in. There are no financial secrets in this book, but there are a lot of fundamentals like, start early and make your contributions. These were the lessons that got me through. The idea behind the book is, I would hope that by reading what I went through, people could figure out what they can do too.

Bobbi Rebell:
Where can people find you, John?

John Schwartz:
I am on Twitter at @jswatz, J-S-W-A-T-Z. There's a Facebook page for the book, This is The Year Schwartz.

Bobbi Rebell:
Love it.

John Schwartz:
It's fun, but the Facebook page is there to talk about the book and for people to talk about their own financial issues. The book is gonna be in stores or you can get it anywhere.

Bobbi Rebell:
Awesome. Well, I am a huge fan, John Schwartz. I highly recommend everybody read it. It is a page turner, which is not typical of personal finance books. So, definitely everyone check it out. Thank you so much, sir.

John Schwartz:
Thank you.

Bobbi Rebell:
Here is my take on what John had to say. Real estate investment glorified in our society, but make no mistake, it is a high stakes proposition and sometimes life and the macro economy gets in the way. Financial Grownup tip number one, buy what you can sell later on. Always think, how will this sell? You can read more in John's book, but in short, that apartment that he bought, because he could afford it, to be fair, was not in a great family neighborhood. He got a good deal, he thought, but when the apartment went for sale in tough times and he needed to sell, it just wasn't selling.

Bobbi Rebell:
Case in point, when my husband and I went to buy our current apartment, there were two identical apartments for sale in the same building, same layout. You get the idea. One was a lot cheaper, like 25% cheaper, a lot. We could have really used the savings, but there was a catch. A giant flashing orange neon parking sign right across the street. You could see it through what would be our son's bedroom window.

Bobbi Rebell:
We rationalized a little bit. Many apartments in New York face brick walls, so this at least was facing open air, just at night there would be this giant flashing parking sign. We could get blackout shades though, right? You know what? We ended up going for the other apartment on a higher floor, not a great view, but an okay view and no parking sign, because we knew that the pull of buyers when we went to sell would be limited even in an upmarket and it could be nonexistent in a downmarket, if we went to sell that apartment where people just would not buy it. Some people, no matter what, they are not buying the apartment with a flashing orange parking sign that would be in their child's room their whole childhood. So, John found out that sometimes an apartment that's a deal, is not really such a deal.

Bobbi Rebell:
Financial Grownup tip number two, don't give up on real estate. John kept at it and had a great experience the second time around. I'm a big believer in owning your own home. The tax breaks are not as good as they used to be, but you're not gonna live in fear of a landlord raising the rent, or simply asking you to leave.

Bobbi Rebell:
Friends, be sure to check out John's new book, This is The Year I Put My Financial Life in Order. You will learn from John, but you will also laugh along with John. It is a fun and readable memoirish personal finance guide well worth your time. Thank you all for spending a little bit of your day with us. Keep up the great feedback. I am on Twitter @bobbirebell, on Instagram @bobbirebell1. I hope you enjoy this episode with John Schwartz and that it brought us all one step closer to being Financial Grownups. Financial Grownup with Bobbi Rebell is edited and produced by Steve Stewart and is a BRK Media production.

 

Money expert Lynnette Khalfani-Cox admits she was “young and dumb” when she owed money and could not pay it back. Instead of facing her reality- she hoped if she ignored it, it would go away. It did not. 

In Lynnette’s money story you will learn:

-Why she decided to borrow money from family

-The reason she was not able to pay it back despite having a plan

-Why she hid from several creditors- and her creative cover ups

-The devastating consequences of not paying her debt

In Lynnette’s lesson you will learn:

-Strategies to identify in advance when you are buying to impress others at your own expense

-No one who loves you is going to want you to go into debt for them

-You can run but you can’t hide from debt

In Lynnette’s money tip you will learn:

-The 3 questions Lynnette and  her husband ask each other before taking on debt

-How to borrow strategically

In my take you will learn

-The importance of facing up to your debt

-The danger of getting creditors involved

-Strategies to lower your obligations including meeting in person and negotiating lower payments

Episode Links

MoneyCoachUniversity.com

Askthemoneycoach.com

https://themoneycoach.net

Follow Lynnette!!

Instagram @themoneycoach

Facebook The Money Coach

Twitter @themoneycoach

Money expert Lynnette Khalfani-Cox admits she was “young and dumb” when she owed money and could not pay it back. Instead of facing her reality- she hoped if she ignored it, it would go away. It did not. In this Financial Grownup podcast episode you'll learn how to strategically borrow money. #DebtFree #FinanceTips #BorrowMoney

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Transcription

Lynette K. Cox:
I was mortified that my sister had to literally call me out and call me on the carpet, and just tell me how raggedy I was being, and how irresponsible.

Bobbi Rebell:
You're listening to Financial Grownup with me, Certified Financial Planner Bobbi Rebell, author of How To Be a Financial Grownup. You know what? Being a grownup is really hard, especially when it comes to money. But it's okay. We're going to get there together. I'm going to bring you one money story from a financial grownup, one lesson, and then my take on how you can make it your own. We got this.

Bobbi Rebell:
Hey, friends. Well, the only thing worse than having debt you can't pay back is having debt and just ignoring it. That will only make it worse. Actually, wait. There is one thing that is actually even worse, and that is, of course, owing money to family and trying to duck it. My guest is Lynette Khalfani-Cox, known as the Money Coach. She is also the force behind Money Coach University. Her sister's loan wasn't the only one she was hiding from. Let's just say there's a guy she wants to impress involved, cars get repossessed, and all kinds of chaos ensues. I can't believe she told us this story. This is definitely unbelievable. Here is Lynette Khalfani-Cox.

Bobbi Rebell:
Lynette Khalfani-Cox, welcome to the show. You are a financial grownup.

Lynette K. Cox:
Hey, thank you so much for having me.

Bobbi Rebell:
Well, it's great to have you, especially because I am such a fan of yours. We've met through friends a couple of times at different events, and of course you were a superstar at the last FinCon, which was fantastic.

Lynette K. Cox:
I am so looking forward to FinCon 2018.

Bobbi Rebell:
Orlando.

Lynette K. Cox:
Exactly. What is not to like about Florida?

Bobbi Rebell:
Exactly. I love the money story that you are going to share with us. You did a little bit of hide and seek in college. You weren't always the superstar that you are now, to say the least.

Lynette K. Cox:
Yeah. That's putting it mildly. The story I want to share is about the time that I hid in college, not just from one creditor, but actually from two. One of the creditors, surprisingly enough, was my sister, Cheryl. I have five sisters, and Cheryl's the oldest one.

Bobbi Rebell:
Oh my.

Lynette K. Cox:
Never a good look there, to hide from a family member that you owe. But also from my car lender. Here's kind of what happened with both situations. I was totally young and dumb when I was in college. Honestly, I didn't borrow wisely, but-

Bobbi Rebell:
What did you borrow for? What were these loans for?

Lynette K. Cox:
With my sister, I had my very first internship, a college internship with ... I'll never forget. With WEAR-TV in Pensacola, Florida, and my sister lived right nearby there at the time, and I was in school in Southern California. I went to University of California Irvine for undergrad. I had this internship, but guess what? It didn't pay. They actually said, "Oh, we'll give you a stipend at the end." What happened was, I asked my sister to borrow money in order to go out there to Florida, to get a plane ticket from Southern Cal into Pensacola area. I had all the best of intentions, and I really did plan to pay her back.

Lynette K. Cox:
Well, what happens? I go back to Southern California after the internship, then I don't. I just don't immediately pay her back. Life got in the way. My tuition, and fees, and books, and supplies-

Bobbi Rebell:
Oh, yeah.

Lynette K. Cox:
... everything else. Then she called me. She was like, "Oh, hey." And she left me a voicemail, and I didn't make a speedy beat to call her back, and then the next week she called me again, and then I didn't call her back, and boy, the third time she called me did she let me have it.

Bobbi Rebell:
Ooh.

Lynette K. Cox:
She said, "Lynette, I don't want you to treat me like you would treat a Visa or a MasterCard, a creditor." She said, "You borrowed from family. I'm your sister and I love you, but you have to be financially responsible. Don't duck your obligations, and most importantly, don't duck me." She said, "If you don't have the money, just say, 'I don't have it.' Or, 'Here, let me pay you back a month from now.' Or, 'Let me work out a payment plan for you.' Or let ..." It was such a wake-up call, Bobbi, I'll tell you, because I was so embarrassed. I was mortified, frankly.

Bobbi Rebell:
Then there was also this car loan.

Lynette K. Cox:
Oh, yeah. There was the car loan. I had a 1987 Hyundai Excel. It was my very first car. Don't you know, that car got repossessed.

Bobbi Rebell:
Oh my gosh.

Lynette K. Cox:
I only missed two payments. I don't know why they did that to me.

Bobbi Rebell:
Is that standard, that they repossess so quickly? Is that the norm?

Lynette K. Cox:
Wait, or was it three? I don't know.

Bobbi Rebell:
But still, that seems ... I don't know. Did you talk to them and say, "Can you cut me some slack?" Was there any dialogue, or you just shut them down?

Lynette K. Cox:
Absolutely not. I was such a bonehead. Again, very quickly, here's what I did. I had a boyfriend at the time. Doesn't it always involve a guy?

Bobbi Rebell:
Uh-oh. Uh-oh.

Lynette K. Cox:
Very nice, sweet guy. We were totally into each other. We're walking through the mall one time in Southern California. We go into a leather store. It was around the holidays. He sees this leather coat, this brown leather coat. I see him look at the tag at the end of the sleeve, on the arm of the coat, and he looks at it quickly and goes, "whew," and just flips that tag back around, as if, "Whew, that's too expensive for my taste." He just keeps walking, but what do I do? Young and dumb. I'm like, "Ooh, note to self. I see that he really liked the coat. I'm gonna come back and buy it."

Lynette K. Cox:
Sure enough, I go back to the store. I spend like $500, which I have-

Bobbi Rebell:
What was your car payment? Do you remember?

Lynette K. Cox:
Yes. It was about $225, $250.

Bobbi Rebell:
We're talking about two months' car payments, which would have prevented the car from being repossessed.

Lynette K. Cox:
Exactly.

Bobbi Rebell:
Oh my gosh.

Lynette K. Cox:
I totally, I just blew it. I mean, I did not even attempt to contact Hyundai Motor Credit Corp, and yes, they did come and take that car, rightfully so, of course.

Bobbi Rebell:
Did the boyfriend drive you around everywhere then?

Lynette K. Cox:
You know what? I learned an even bigger lesson, because I had to fess up. One day I walked out of my apartment that I had. You would have thought I was Halle Berry. I was such an actress, okay? I was like, "Where's my car?" He was like, "Oh my god. Did somebody steal your car? Where's your car?"

Bobbi Rebell:
"You're wearing it."

Lynette K. Cox:
Yeah, exactly.

Bobbi Rebell:
Did he have the jacket on? Oh my gosh.

Lynette K. Cox:
Finally, I fessed up. I was like, "No. You know what, honey? Actually I think my car got repossessed." He was like, "What?" He was like, "What do you mean?" I said, "Well, to be honest, I didn't pay my car note." He was like, "What?" He was so shocked. He looked at me. He said, "If you didn't have the money for it, how come you didn't just ask me? I would have given you the money."

Bobbi Rebell:
Oh my gosh.

Lynette K. Cox:
He was a very sweet guy, and I said, "No, no, no." He knew that I was working at the time. I was a dispatcher for AAA at the time, in college. He says, "Well, can I ask, what did you do with your money?" I was like, "You know that brown leather coat that I got you for Christmas?" He was like, "Yeah." I said, "Well, I kind of spent two car payments on that."

Bobbi Rebell:
See, he wouldn't spend his own money on that.

Lynette K. Cox:
Yeah. But he told me something, Bobbi, again, that I never forgot. He said, "Lynette, I would have never want you to put yourself in the hole for me." It was a wake-up call. I mean, nobody who loves you is really gonna want you to just ... You don't have to spend to impress somebody. You don't have to buy someone's love. You don't have to try to dig yourself in the hole, quote-unquote, to make somebody else happy. It just doesn't work that way.

Bobbi Rebell:
What is the lesson for our listeners? What could you have done differently, looking back with all of your wisdom now?

Lynette K. Cox:
Unquestionably, the biggest lesson that I got is that you can run, but you can't hide, and that literally as much as you may try to duck your responsibilities ... Believe me, I tried to hide that Hyundai. Like, I parked on the side, not right in the front of my apartment complex. But as much as you try to shirk or duck your financial responsibilities, in the end, it always catches up with you.

Bobbi Rebell:
For your money tip, I love that you're going to talk about debt, because sometimes you do need to borrow money.

Lynette K. Cox:
What my husband and I do, before we borrow now, we first ask ourselves three questions. Question one is, "Can we afford to pay cash instead of borrowing?" If the answer is "no," or "not comfortably," then we say, "Is this something that's worth borrowing for?" We love to travel, but is it worth just going into debt, putting it on a credit card, and really, the answer is "no" for that. But the third question is, "If you say yes, it is worth borrowing for, what is the lowest cost source that we can tap to borrow and pay off the debt?" When you do that, at least you're borrowing strategically. You're borrowing wisely, giving it some serious thought and consideration before you just sign on the dotted line.

Bobbi Rebell:
All right. Before I let you go, let's talk about MoneyCoachUniversity.com.

Lynette K. Cox:
Well, I'm doing courses, and I'm teaching people everything under the sun about money, about budgeting. I have a course on there, Negotiating for Women. I have a course about paying for college, credit courses, debt courses. It's really teaching people the nuts and bolts about personal finances, in what I hope is an engaging way, and they get lessons. I give them homework assignments, and we kind of make it fun, but it's all video-based. You know, I write a lot. You know I've written 12 books, but everybody doesn't want to read a 200, 250 page book. Watch a video instead, and learn.

Bobbi Rebell:
You are prolific. Oh my gosh. I mean, 12 books, all these video courses. Amazing. Where can people find you?

Lynette K. Cox:
Well, my free financial advice site is AsktheMoneyCoach.com. A ton of videos on there. 1600 plus articles. You mentioned that I've written 12 books. I'm super proud about that. Then the latest is MoneyCoachUniversity.com. We're all on social media. Everything is just @TheMoneyCoach. Facebook, Twitter, LinkedIn, YouTube, all that good stuff. Instagram too, now.

Bobbi Rebell:
Instagram too. Everything.

Lynette K. Cox:
I'm on the Gram.

Bobbi Rebell:
I know. I don't know how you do it all. Thank you so much for joining us. This has been great. Thank you so much.

Lynette K. Cox:
Thank you, Bobbi.

Bobbi Rebell:
This episode was a tough one. My friends, I truly hope you do not have an experience anything like Lynette. Financial Grownup Tip number one: Do not duck and cover. If you can not pay a debt, find a way to work something out. No creditor wants to get zero paid back. They want to work with you, and you do not want them sending your case to a collection agency. No one wins there, and it will wreck your credit score. There's nothing more not grownup than just hoping if you ignore the debt it will go away. It will not.

Bobbi Rebell:
Financial Grownup Tip number two: Make a phone call to the person or business to whom you owe money. Even if you can, make an appointment and go in person. I say that because if you just email, there's no human touch. If they can sense your goodwill and your honesty, and see you as a person, not a bill to be collected, it could make them want to help you more, because you're a person, not a piece of paper. While you should be prepared to tell them what you can pay- in other words, do your math in advance and come prepared- before you actually offer anything, tell them your story and say, "I want to work something out. I value your service, and you do deserve to be paid, but can you help me out a little here? What can you do for me?"

Bobbi Rebell:
Just give it a few minutes. Let them think about it. They may reduce the overall bill. They may propose some kind of payment plan that works for you better than you even would have proposed to them. Even if they don't, move forward. Set up something. Find a way to pay them something. If you are really tight, a small payment, even if they have to increase down the road.

Bobbi Rebell:
Thanks to all of you for supporting Financial Grownup. If you like the show, take a minute to rate and review us, and if you have not already, please hit the subscribe button so you won't miss any episodes. I want to hear from you guys. Get in touch on social media, @BobbiRebell on Twitter, @BobbiRebell1 on Instagram, and don't forget to leave me comments. Go to my website. Please sign up for my newsletter so I can keep you posted on everything going on with the show. No more hide and seek, my friends. I hope you guys enjoyed Lynette's story as much as I did, and that we all got one step closer to being Financial Grownups.

Bobbi Rebell:
Financial Grownup with Bobbi Rebell is edited and produced by Steve Stewart, and is a BRK Media production.

The popular podcast host fesses up to having been a cheapskate fashion victim early in his career- and how learning to dress better, literally made him wealthier. 

 

In Joe’s money story you will learn:

-Joe’s penny pinching philosophy- and how it backfired

-The impact of getting a gig on local tv

-Joe’s off-base take on how to develop trust in clients

 

In Joe’s lesson you will learn:

-The true cost of plastic shoes

-Why your co-workers may not tell you the truth

-How to avoid some of Joe’s mistakes

-How Joe invested in fixing his image problem, and increased his wealth

-Ways to get feedback on not just your career but also other aspects of your life

 

In Joe’s money tip you will learn:

-How to delegate one person to be the lead family financial manager

-What Joe refers to as ‘fantasyland'

-The one thing Joe does that avoids fighting about money in his family

-How to spot mistakes in your bills

 

In my take you will learn:

-The value of investing in your personal appearance

-What Kevin O’Leary had to say about investing in quality clothing and accessories

-How I have been burned by low quality purchases as fast fashion stores

-Why renting clothing can be a viable option that may work for your budget

-The importance of constantly upgrading your skills through education including online courses. 

 

Episode links:

Mint

Clarity Money

Moneylion

Udemy

Rent the Runway

 

Follow Joe Saul-Sehy!

 

Joe’s course How to legally cheat on your taxes

Joe’s money in the mornings show on facebook

Joe’s Facebook group

 

Money in the Morning podcast

Stacking Benjamins podcast

 

Twitter: @averagejoemoney

Facebook: Facebook.com/stackingbenjamins

The popular podcast host fesses up to having been a cheapskate fashion victim early in his career- and how learning to dress better, literally made him wealthier. 

The popular podcast host fesses up to having been a cheapskate fashion victim early in his career- and how learning to dress better, literally made him wealthier. In this Financial Grownup podcast episode we discuss the value of investing in your personal appearance. #AppearanceTips #InvestInYourself

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Transcription

Joe Saul-Sehy:
That changed my entire career. My career went from growing at an okay rate, to all the sudden growing by leaps and bounds because I looked the part.

Bobbi Rebell:
You're listening to Financial Grownup with me, certified financial planner, Bobbi Rebell author of How To Be A Financial Grownup. You know what, being a grownup is really hard, especially when it comes to money. But it's okay, we're going to get there together. I'm going to bring you one money story from a financial grownup, one lesson and then my take on how you can make it your own. We've got this.

Bobbi Rebell:
Hey friends. This episode is all about investing in yourself. Whether it comes to your wardrobe or your education as you hear and will hear more from our guest Joe Saul-Sehy is the host of the crazy popular award winning Stacking Benjamins podcast. I don't have time to list all of the awards it has won but they include Best Business Podcast from the Academy of Podcasters, and Best Finance Podcast by Kiplinger. They also win a lot of these Plutus Awards among others.

Bobbi Rebell:
You're going to really like Joe's story. If you're a good dresser you're going to feel validated for spending all that time, effort and money. If you're not such a good dresser, I hope you're going to get motivated. Here is Joe Saul-Sehy. Joe Saul-Sehy, you are a financial grownup. Welcome to the podcast.

Joe Saul-Sehy:
I can't believe I made it here. I must be a grownup if I made it here.

Bobbi Rebell:
You must, and you're up early these days. We're going to talk more about it later, but congratulations on the launch of Money In The Morning. It's awesome, and I love the music.

Joe Saul-Sehy:
Thank you. We picked it out just for you Bobbi. That's our whole thing, if we can win with Bobbi we win with everybody, so there we go.

Bobbi Rebell:
It's happy music.

Joe Saul-Sehy:
It is happy music, and I need happy music with coffee in the morning.

Bobbi Rebell:
You've evolved a lot in your grownup life, but there was a time, and we're leading into your money story here Joe, when you were a bit of a cheapskate. It wasn't just affecting you, it was really affecting your whole universe. Do tell.

Joe Saul-Sehy:
I was a financial planner for 16 years. During that time I was teaching people how to pinch pennies and cut corners where they could. I thought, "You know, I really should take my own advice." I learned a valuable lesson here because people come to see you and they expect a certain type of person, but at the time I didn't think about that. I thought, "You know what? I'm in my office all day. I'm never out of my office." When I am, I started doing a television gig in Detroit at WXYZ Channel Seven, go Detroit. Even when I did that, people didn't see my shoes. So I went from really nice shoes-

Bobbi Rebell:
Well people that were watching you on camera did not see your shoes.

Joe Saul-Sehy:
Right, right.

Bobbi Rebell:
To be clear.

Joe Saul-Sehy:
People watching me on television didn't see my shoes. People that I interfaced with on a daily basis, they did, and my clients did. So I went from these really nice shoes that I had to these plastic shoes. You know, the shoes that buy at-

Bobbi Rebell:
I don't know about plastic shoes Joe.

Joe Saul-Sehy:
Of course you don't. Like a Payless shoes. I would go there and I'd find these shoes that looked nice, but they looked like they were polished but they really were just plastic-y. For about a year, I for those. I dumbed down my suits, I wore cheaper ties. I thought, "People trust me, they like me. I don't need to spend a lot of money on this stuff." And then I realized that everything that I was doing was wrong one day, when I finally bought some new shoes and I went to my mentor's office, and the very first thing he said Bobbi, I walk in he said, "It's about time you got rid of those cheap shoes."

Joe Saul-Sehy:
I said, "What are you talking about? I've had those for a year. How come you didn't tell me?" He goes, "Well, I just thought you'd find out sooner or later by yourself." So I realized then that everyone notices. Then when I hired a firm to help me look better on TV, because I also-

Bobbi Rebell:
You hired someone.

Joe Saul-Sehy:
I had to.

Bobbi Rebell:
So now you're really investing.

Joe Saul-Sehy:
Yes. Yes, because I realized from the shoes, I realized I kind of have to invest in my career, and then I realized how bad everything was. The very first thing that the firm said that I hired, they said, "Well, we need to give you a big boy haircut." Because I was still wearing this haircut that I had from college, this is back when I had hair. They changed my look to be a more sophisticated haircut, to be shorter, to be more conservative, to look the part.

Joe Saul-Sehy:
They went with me shopping for clothes to show me how I could still spend less money on clothes, but I had to dress much more smart. I had to be trust ... and it's funny how that changed my entire career. My career went from growing at an okay rate, to all the sudden growing by leaps and bounds because I looked the part. I don't know about you Bobbi, I don't trust people who look too good, people that are dressed to the nines. For whatever reason I don't trust them, but that doesn't give you an excuse to not dress appropriately, and I guess even to widen it, to take responsibility for your career. We have to take responsibility for this thing that we call a career and make it our own?

Bobbi Rebell:
Expending on that, what is the lesson for our listeners from the story?

Joe Saul-Sehy:
I think the big lesson is don't wait for somebody else to give you this feedback about your career. Look in the mirror, and not just in the physical aspects like I was, but look in the mirror when it comes to your relationships with your family, with your relationship with money, with your relationship with your job. It's far easier, everybody wants to pinch pennies, it's far easier to go make a lot more money that it is to pinch pennies. It's funny, we might be able to save 50 cents or a dollar, but we could make $100 this week if we just looked outside ourself and went looking. I mean, there are so many job opportunities online, there are so many things to do. Look in the mirror and take responsibility for yourself was something that I learned that day that I try to teach other people now.

Bobbi Rebell:
And grow the top line.

Joe Saul-Sehy:
Grow the top line, amen.

Bobbi Rebell:
So give us a money tip, something personal that you and your family do that people can maybe make their own and do right away.

Joe Saul-Sehy:
I just said, focus on the top line Bobbi, but I also look at the bottom line. Because if we can stretch the difference between the two of those, then that's where we experience growth. In a lot of families what I noticed is that one person in the family, like you have a budgeting partner, a spouse, a significant other, one person usually knows where every dollar is, every dime is. The other person's in a place I refer to as fantasy land. They think they know, they have this general feeling, but they also know the other person's taking care of it.

Joe Saul-Sehy:
That's when fights begin. That's when bad things happen in a relationship, it's because the person in fantasy land all the sudden realizes the fantasy doesn't look the way they thought that it should have, so there ends up being friction. To avoid friction, something that Cheryl my spouse, and I implemented and that I like to teach people how to do, is just have a quick weekly meeting. Maybe 15 minutes over breakfast, or I prefer over wine.

Bobbi Rebell:
In the evening, not wine at breakfast.

Joe Saul-Sehy:
It's wine, iHop, you're probably [crosstalk 00:07:10]

Bobbi Rebell:
I mean, I'm not judging but you know.

Joe Saul-Sehy:
That's right, good for somebody but maybe not me. The thing I like about this weekly meeting though is it's quick, it's actually fun. We look through ... I use an app called Clarity Money but you can Mint, you can use MoneyLion. There's lots of apps out there. You could even just use a spreadsheet or look through, go to your bank website and take a look at what expenses you had. It's very easy, here's the way we do it. We look through all the upcoming expenses. What are we going to spend money on in the next week? We talk through that. Then the second thing we do is we look at the previous week's expenses and we see if there were any mistakes on any of our bills. What's funny is, we find so many mistakes. It's horrifying how many-

Bobbi Rebell:
And they're never in your favor.

Joe Saul-Sehy:
They never ever ... It's amazing that none of them ... Yeah, isn't that shocking. Yeah, business is always taking from me. And then also look for recurring expenses that you don't need anymore. I found just a couple weeks ago that there's been a recurring meeting, because we miss meetings from time to time and I must have missed it the last two years in a row. There's a Norton subscription that I've had for the last two years that I don't have hooked up to anything. That's a $100 a year for this subscription. It was really ... Luckily I caught it. I was able to get back this year, I can't go back and get the year before that, but have that money refunded to me.

Bobbi Rebell:
That's a good thing.

Joe Saul-Sehy:
Yeah, which also is cool. But the best thing is, Cheryl and I now go through the week and we know where the dollars are going to be spent. If things change we've got this open line of communication. I've got to tell you, it's so fun. The weekly meeting is so fun.

Bobbi Rebell:
Good. And you know what's really fun? Is spending less on your taxes. I have a CFP, but I have to tell you, especially because I got the CFP before the new tax law was passed. I find it a little bit overwhelming, but you have out that can help a little bit.

Joe Saul-Sehy:
Yeah. Thanks for mentioning this, because we were going to call this, Bobbi, we were going to call it Understanding The Tax Form, but that sounds so boring. It just sounds so-

Bobbi Rebell:
I would want that. I would do that one, but maybe not other people.

Joe Saul-Sehy:
[crosstalk 00:09:10] Yeah, you and I are money nerds so that's great. But here's what somebody did with me, this is the genesis of the course. I thought taxes were kind of mystical and I would ask people, "Can I write this off? Is this something that maybe I can take advantage of? Is this taxable? Is this not taxable? How does it all work?" Somebody sat down with me and walk through the 1040 and how the 1040 works, and then the itemized deductions page and how that works.

Joe Saul-Sehy:
Once I knew that, and what's cool is it's only three pages, once we walked through that I totally then could see what I could write off, what I couldn't write off, where my opportunities might be, how my retirement plan fit into the big picture, what the downsides might be in the future, what tax problems I might have in the future. We call the course How To Legally Cheat On Your Taxes, and it is a lot of fun. It's a do at your own pace course. It teaches you how taxes work. You can do two things. Number one, put Humpty Dumpty together, like right now during tax season.

Bobbi Rebell:
Yes, it's coming.

Joe Saul-Sehy:
Put things together- Yeah, put things together in a way that helps. But that's not where the magic is. I think the real magic is doing things through the year so that when you're trying to put Humpty Dumpty together next year, you're able to do that much, much better because you knew how taxes worked going in. I think that the powerful thing. That's the reason we created it, was to try to get people that same leg up that I got.

Bobbi Rebell:
I love that. Where can people find that? And where can people find you? I know Facebook in the morning, it's fascinating people. You can him do Money In The Mornings on Facebook and you can see how everything is made.

Joe Saul-Sehy:
It's so-

Bobbi Rebell:
Including the bloopers.

Joe Saul-Sehy:
Yeah. I was going to say, it's so uncomfortable because ... and I did it live on Facebook to try to force myself to do ... We talked earlier about taking responsibility for your career. One thing I do, I'm a natural stutterer, and do try to get around stuttering-

Bobbi Rebell:
What?

Joe Saul-Sehy:
Yes, and to make myself more natural on camera and try to get used to that. I started doing these daily Facebook Lives and say, "You know what, we're going to do this show without a net." So Money In The Morning is without a net, five days a week, wherever you're listening to this show. We just do two quick headlines. It's live, and man sometimes bad stuff happens. Which I think some people listen to it just to hear the car wreck.

Bobbi Rebell:
That's the best part.

Joe Saul-Sehy:
Right, right. Just to hear some of the bad stuff that sometimes happens, because you can't take it back if it's live.

Bobbi Rebell:
I know. All right, so where can people find you and the course and everything?

Joe Saul-Sehy:
Yeah, yeah. That's wherever you listen to this podcast, is where you can find Money In The Morning or Stacking Benjamins, our main show. The course is at learn.stackingbenjamins.com, that course, and we have a couple others, Save 50% Of Your Income and a quick hit course on your benefits package, so when you are going through open enrollment every year. Just a very quick, like, "What do I need to remember while I'm doing my open enrollment?"

Bobbi Rebell:
Cool. Where can people find you social media before we go?

Joe Saul-Sehy:
I am @AverageJoeMoney on Twitter, stop by and say hi. On Facebook it's facebook.com/istackbenjamins.

Bobbi Rebell:
Joe Saul-Sehy, thank you so much.

Joe Saul-Sehy:
Thanks Bobbi. This was so fun. I'm so happy that I'm finally a grownup.

Bobbi Rebell:
You are. Congratulations Joe. Here is my take on what Joe had to say. Financial Grownup tip number one, wear quality clothing. This is something that previous guests Kevin O'Leary touched on as well with respect especially to his mother. Not only is it important to look your best in business, but you often come out financially ahead.

Bobbi Rebell:
I get tempted like everyone by the fast fashion places. I always get burned. I buy a sweater for 20 bucks, it looks identical to the one for 200 in the department store, so I think I'm really smart. But then, after a couple of wearings, it's trash. I'm going to let you guys in on an open secret. Notice that I said wear quality clothing. I did not say buy. If you come see me speak, I am often wearing a very expensive designer dress that I don't own. It's rented. The designer handbag I'm carrying, you got it, probably rented. That way I get the benefits of always showing up in a well made dress without having to constantly invest in buying expensive clothing.

Bobbi Rebell:
Financial Grownup tip number two, always keep learning. Joe talked about education, so whatever interests you or will further your career, get better at it. If you work for a big company, always find out what they will pay for. My first employer, CNBC, paid for my CFP classes. There are also incredible online resources from LinkedIn to Udemy, even Investopedia has great online classes. In fact many top universities are putting their classes online and you can often audit them for free. Make yourself smarter, it will probably pay off for you financially, but you'll also probably enjoy it.

Bobbi Rebell:
Thank you all for your support and feedback. I truly appreciate everyone who has subscribed, rated, reviewed and shared the podcast. It's amazing. Please, follow me on social media @BobbiRebell on Twitter, @BobbiRebell1 on Instagram. Go to my website, sign up for my newsletter so I can keep everyone posted on everything going on with the show. I hope you enjoyed Joe's story and that we all got one step closer to being financial grownups.

Bobbi Rebell:
Financial Grownup with Bobbi Rebell is edited and produced by [Steve Stuart 00:14:28] and is a BRK Media production.

Stefanie O’Connell had stars in her eyes but no cash in her bank account. So she pivoted her passion for drama into a more profitable profession. 

In Stefanie’s story you will learn:

-The challenges of her seven years as a professional actress

-How the recession left her unemployed half way around the world

-The harsh financial realities of the entertainment business

-The creative ways Stefanie handled her finances, including roommates, while she traveled as an actress

-Her advice on balancing passion with paying for the life you want

-Why she pivoted to become a personal finance expert

-The tools she uses to manager her own money

-How to build a lifestyle you love while still following your passion

-The two big fairytales she says millennials need to get over

-Her take on how the financial challenges millennials face are different from previous generations

In Stefanie’s lesson you will learn: 

-How to own your income potential

-Ways to build your skill sets and find new market opportunities

-How to maximize income growth

-How to transition your passion skill set into one that is also profitable

 

In Stefanie’s money tip you will learn:

-Her online shopping strategy

-How she uses online cash back portals like ebates

-The savings you can get from browser extensions like Honey that automatically search for coupons and promo codes

-Ways to stack your savings using cash back credit cards

In my take you will learn:

-Why I believe passions should usually not be connected to income

-The benefits of taking the pressure off earning money from your passion

-The danger of having unrealistic expectations from side hustles

-Strategies to own your future by going beyond your credentials like academic accomplishments

 

Episode links:

Stefanie’s book The Broke and the Beautiful Life

Ebates

Honey

 

You can find Stefanie at:

Stefanie O’Connell.com

Get Stefanie’s free Cash Confidence challenge  

Sign up for Stefanie’s All In DIY class!

Stefanie’s facebook group: https://www.facebook.com/groups/661192974055824/

Stefanie’s book The Broke and the Beautiful Life

Instagram @stefanieoconnell

Twitter @stefanieoconnell

Facebook: Stefanie OConnell

Stefanie O’Connell had stars in her eyes but no cash in her bank account. So she pivoted her passion for drama into a more profitable profession. In this Financial Grownup podcast episode you'll learn about Stefanie's challenges of her seven years as a professional actress, her advice on balancing passion with paying for the life you want, and how to maximize income growth. #Income #LifeLessons #Author

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Transcription

Stefanie OC:
The reality hit me that this pursuit of my "passion" that everyone says, that isn't always the case because there's more to your life than just what you do for a living.

Bobbi Rebell:
You're listening to Financial Grown Up with me, certified financial planner, Bobbi Rebell, author of How to be Financial Grown Up. You know what, being a grownup is really hard, especially when it comes to money. But it's okay. We're going to get there together. I'm going to bring you one money story from a financial grown up, one lesson, and then, my take on how you can make it your own. We got this.

Bobbi Rebell:
Hey, friends. How many of you have been told, "Follow your dreams. The money will come. Just trust in yourself?" In most cases, you were lied to. Former struggling actress turned millennial finance expert Stefanie O'Connell is here to set you straight. She is also the author of The Broke and The Beautiful book, and she also has a thriving community over at her website, stefanieoconnell.com. I love her story because it will put you on a path to prosperity and, hopefully, more happiness doing what you really are passionate about when you're not earning money. Here is Stefanie O'Connell.

Bobbi Rebell:
Stephanie O'Connell, author of The Broke and Beautiful Life and millennial money expert, you're a financial grown up and welcome to the program.

Stefanie OC:
Thank you for having me, Bobbi.

Bobbi Rebell:
I want to congratulate you on your new venture, All In. Tell us about it.

Stefanie OC:
Oh, it is a course specifically designed for millennial women who want to feel as confident with their money, as they do in the rest of their lives. I know too many women who are really successful in their careers, really successful in their personal relationships, and all these different facets of their lifestyle, but when it comes to their money, they feel really out of control, so I built this 10-module step-by-step blueprint to help those ambitious women match their cash competence with their lifestyle ambitions.

Bobbi Rebell:
Perfect, and we will put a link to where you can find that more in the show notes. I want to get right to your story because it's so relatable and it's something that is so relevant to young people figuring out where they want to put their energy and where they want to earn their money. Tell us your money story, Ms. Stefanie.

Stefanie OC:
Okay. I'm going to try to keep it concise here. It's been a bit of a journey. But, essentially, it started in college when I decided I was going to pursue acting professionally. Now, I did get a degree in psychology as well as like backup plan, my responsible, quote unquote backup plan, but the plan was to be a professional actress and, believe it or not, I was. I actually was for seven years a professional actress, but it was extremely difficult, primarily because I worked in theater, not film, so the paydays are not the same.

Stefanie OC:
I also graduated in 2008, which was the year of the recession. So even though I got a great job right out of school on like a dream tour of Asia, understudying one of my professional musical theater idols, the producers flew out about halfway through the tour, and there were, like, "Oh, you know, there was a global recession. We're going to send you all home." [inaudible 00:03:22]-

Bobbi Rebell:
Just like that?

Stefanie OC:
Yeah just like that, so my bubble just got-

Bobbi Rebell:
So you basically got laid off in the middle of the world, in the middle of nowhere.

Stefanie OC:
As a actress, which is the most ... it's the first thing to go, right? Entertainment budget, especially for something like live theater that's really expensive is the first thing people cut out. So the industry was really in bad shape and the first job offer I got after was to play three leading roles in three musicals for $225 a week. And I was like, "Okay, that is not sustainable. Yeah. This is my profession it is how I support myself." So I had to turn it down. And for the next five or six years after that I kept coming up against this reality of okay, I'm doing what I love, but it's not paying the bills. It's not sustainable, it's not consistent, when I do get work it's a huge win if I'm making $500 a week, I live in New York city. That is not enough money to sustain even a very basic lifestyle.

Bobbi Rebell:
Yeah, how were you living? Did you have roommates? What was going on there?

Stefanie OC:
Oh yeah. So I've always had roommates. I've never not had roommates, so I'm 31 years old.

Bobbi Rebell:
Including now.

Stefanie OC:
Including now. I live my boyfriend now, so it's a little different.

Bobbi Rebell:
That's a good kind of roommate.

Stefanie OC:
Yeah it's a better kind of roommate situation. And then I also sublet my apartment a lot. So one of the things about being an actor is I was on the road a lot, so I was able to sublet my apartment so I didn't have the expense of rent which was a savior for me. And so even if I wasn't making a ton of money, maybe two, three hundred dollars a week, if I didn't have a $1500 a month cost of rent that made it a lot more sustainable to pursue it. That said, I would come home at the end of my contracts and still need to pay rent.

Stefanie OC:
So it just didn't work. The numbers didn't add up. And so what happened for me was there was just this huge sense of frustration and the reality hit me that this pursuit of my passion, quote unquote, that everyone says if you do that everything will work itself out, just that isn't always the case when it comes to your money. Because there's more to your life than just what you do for a living. There are other goals you have, there are the trips you want to take, there are the weddings you want to have, there are the children and family you want to start, there's the house you want to buy. And that costs money. And I had this realization that if I continued doing what I was doing I was never going to create enough capital through acting, through this pursuit of my passion to do all these things that I cared about in the rest of my life.

Stefanie OC:
And so I really started digging into personal finance because I wanted to understand, okay, how do I take the little money I have and maximize it and then step two, how do I bring more in? So that I have more to maximize and that really set me on this journey of personal transformation to owning my own cash confidence, as I like to call it, through tracking my spending, through earning more, through learning to invest, through saving and tracking that all on my blog at stefanieoconnell.com and then finding a community of other people in similar situations, millennials working through the recession who were really taught do what they love and are facing this reality of, well what if that doesn't pay the bills? And how do I still build a lifestyle I love, even if it's not necessarily the way I thought it was going to look like?

Bobbi Rebell:
Do you feel that you and lot of millennials were sold this fairytale that if you follow your passion the money will come?

Stefanie OC:
Absolutely. I think there are two big fairytales. That one and then the second one is if you get a college degree you're set for life. Because I think you know, for my parents for example, they graduated college, they did get their MBAs, but from there it was smooth sailing right from graduation to retirement. There was great salaries, there were income increases, there was healthcare, there was retirement benefits. I've never had any of those things. I've never had employer sponsored health care, I've never had a 401K plan. So it's so much more, even if you're not necessarily pursuing your passion, even if you're just trying to make a living, for so many young people today there isn't that inbuilt infrastructure that takes your hand and paves the way for you from graduation to retirement.

Stefanie OC:
So much of the onus now is on the individual, and that's why I really started writing about this stuff, because I found that so much of the personal space was like, "Contribute to your 401K." And meanwhile, I'm surrounded by people who've never even had the opportunity to have access to a 401K. So that's why I write about what I write about.

Bobbi Rebell:
All right so you are 31 years old now. What is the lesson from that journey, for our listeners?

Stefanie OC:
Yeah, so for me the biggest lesson is that you are the primary driver of your own income potential. I think we have this idea that our degree or our experience or our skills or our lack of any of those things is what dictates what opportunities are available to us, but the reality is it's us. It's our willingness to continue putting ourselves out there, building our skillsets, finding new market opportunities and really putting ourselves in the drivers seat of our own earning potential that really leads to maximal income growth. And I think that it's so important because we too often make excuses for ourselves for why a six figure salary is not available to us or why a one million dollar net worth is not available to us.

Stefanie OC:
And we have to [inaudible 00:09:04] ownership of those things, before we can start making progress to actually achieving them.

Bobbi Rebell:
And it may not be in the glam career that you envision, that may be a side thing.

Stefanie OC:
Yeah. And the other thing is I think there's this all or nothing mentality that's really destructive. I'm not professionally acting anymore, but I love what I do. And one of the big things I do is I give talks, I go on camera a lot, I do a lot of media appearances and I feel like I get to use that skillset from acting that I so enjoyed [inaudible 00:09:36] performance all the time, but now I get paid ten, 20, 30 times what I used to make. But the fact is I would have never found this outlet if I had never pivoted temporarily to something a little less glamorous like freelance writing and blogging about money. Right?

Stefanie OC:
So we have to remember that it's not like you're abandoning this thing forever, it's just about trying a new approach so that you can have a lifestyle you love and not just a career you love.

Bobbi Rebell:
Give us a money tip, something specific and actionable that everyone can do right now.

Stefanie OC:
Okay, so this one is a little bit more simple, a really quick win that you [crosstalk 00:10:15]-

Bobbi Rebell:
We love simple.

Stefanie OC:
Can start with right now.

Stefanie OC:
There's a lot of shopping online, I personally do most of my shopping online because anytime I walk into a retail environment it's a 20 minute wait, it drives me crazy. So one of the ways I save, I have different ways of doing my shopping. So I will sometimes go through an online cash back portal, like an Ebates, where if you go through their portal first and then select the retailer you can get one or two or three or four percent cashback on all of your purchases. And then also downloading a browser extension like Honey that automatically searches for coupons and promo codes for you. And applies them to your order without you even having to go open up 20 tabs and search for promo codes.

Stefanie OC:
And then you can stack your savings even further by using a cash back credit card. So you know, get one percent or [inaudible 00:11:10] percent cash back on all purchases on your credit card, plus the promo code, plus the cash back from shopping through something like Ebates, you're really stacking your savings for immediate wins on all your purchases.

Bobbi Rebell:
Excellent advice, Stefanie O'Connell, millennial money expert, thank you so much.

Stefanie OC:
Thank you Bobbi.

Bobbi Rebell:
Okay friends, here is my take on what Stefanie had to say. Financial grown up tip number one, detach your passion from your income. We all spend a lot of time at our paying jobs and businesses so obviously you don't want to pick something that you don't like and you can't stand. You want to be happy, you're putting a lot of time in there, but that may not be your passion. Focus on earning the income you need to be happy in life and maybe pursue that passion on the side. It could be a side hustle, it could just be a hobby. Take the pressure off trying to earn a living at your passion. You may actually find yourself enjoying it more without the pressure to create income from that passion.

Bobbi Rebell:
Financial grown up tip number two, don't sit on your laurels just because you got a college degree. It matters a lot, but for the most part after your first job it's going to come down to you and how hard and how smart you work. As Stefanie said so well, you have to have ownership of your own future. Don't just show up at your job, really show up. Be present, try hard, do extra things that are beyond the exact job duties. Impress your boss, learn new skills. A degree is only one piece of the puzzle, you have to fill in the rest by earning it.

Bobbi Rebell:
All right thank you all for your support of the podcast, I love hearing your feedback and I truly appreciate everyone who has subscribed, rated, reviewed and shared the podcast. Please also follow me on social media. I'm @bobbirebell on Twitter, @bobbirebell1 on Instagram and of course, go to my website, sign up for my newsletter so I can keep you posted on everything going on with the show.

Bobbi Rebell:
I hope you enjoyed Stefanie O'Connell's story and her advice. I think she's terrific. Check out her website, as I said, stefanieoconnell.com, and I hope we all got one step closer to being financial grown ups.

Bobbi Rebell:
Financial Grown Up with Bobbi Rebell is edited and produced by Steve Stewart and is a BRK Media production.

In this episode, millennial financial literacy advocate David Grasso, of Gen FKD and Bold Business shares the story of his Cuban immigrant mother and how at age 9 she found herself in charge of the family finances after an unexpected accidental death in the family. 

 

In David’s story you will learn:

-How David’s heritage as the child of Cuban immigrants shaped his focus on finances

-David’s strategy for not just making money, but keeping more of it

-The strategies David learned from his mother, who took over her family finances at age 9

-How talking about money at the dinner table can instill children with financial values

In David’s lesson you will learn:

-Why getting a raise is not the solution to your financial problems

-David’s savings plan strategies

-How to be a defensive consumer

-The dangers of automatic bill payments

In David’s Money Tip you will learn:

-Why he focuses on the bigger purchases in his life

-How to be a defensive consumer

-How David uses the Trim app

In my take you will learn:

-How to fight for your price.

-The true story of how I paid $25 for a prescription where one quote I got was for $354!

-How to use online coupons for prescriptions

-Why the price you pay through insurance is not always the lowest

-When to pay attention to big expenditures vs when to acknowledge that little things like latte’s do add up and become big things over time

Links from this episode

Gen FKD @genfkd

Bold Global  @boldglobalmedia

BoldTV

Bold Business

Bookstr

David Bach

Trim app

Check out David Grasso’s articles GenFKD here: http://www.genfkd.org/author/david-grasso

Find David’s Bold Media page at http://bold.global/david-grasso

David is also a content creator @purehouselab

You can follow David

Twitter: @grassroots

Instagram: @grassoroots

Facebook: David Grasso-Ortega

In this Financial Grownup podcast episode, millennial financial literacy advocate David Grasso, of Gen FKD and Bold Business shares the story of his Cuban immigrant mother and how at age 9 she found herself in charge of the family finances after an unexpected accidental death in the family. We also discuss why getting a raise is not the solution to your financial problems and the dangers of automatic bill payments. #Money #MoneyTips #MoneyGoals

In this Financial Grownup podcast episode, millennial financial literacy advocate David Grasso, of Gen FKD and Bold Business shares the story of his Cuban immigrant mother and how at age 9 she found herself in charge of the family finances after an unexpected accidental death in the family. We also discuss why getting a raise is not the solution to your financial problems and the dangers of automatic bill payments. #Money #MoneyTips #MoneyGoals

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Transcription

David Grasso:
"Oh, if I only got a raise I would have more money. Oh, if I only made this much more I would be stable." It never works that way.

Bobbi Rebell:
You're listening to financial grown up with me certified financial planner Bobbi Rebell, author of how to be a financial grown up. But you know what? Being a grown up is really hard especially when it comes to money. But it's okay. We're going to get there together. I'm going to bring you one money story from a financial grown up, one lesson and then my take on how you can make it your own. We got this.

Bobbi Rebell:
So I think we've all had that feeling where if we just had that one little raise or that one more client, we would feel less stressed out financially. I know I've of course felt that way, and so has my friend David Grasso. He's a millennial financial literacy advocate. He's also the editor at non-profit GenFKD. And the anchor of Bold Business where I have had the pleasure of co-hosting with him.

Bobbi Rebell:
David is also the child of Cuban immigrants who came here just after the revolution, their experiences really shaped his focus on not just making money but also on keeping it. He grew up first in a little Havana area of Miami. And fun fact, he later moved to the Disney inspired town of celebration, Florida. Here is David Grasso.

Bobbi Rebell:
David Grasso, you are a financial grown up. Welcome to the podcast.

David Grasso:
I hope I'm a financial grown up by now. I'm a spokesperson for a financial literacy non-profit, Bobbi.

Bobbi Rebell:
You are. So tell me what is new with GenFKD and both business, and of course campus fellows for 2018

David Grasso:
You know, we've expanded our reach, GenFKD is a non-profit dedicated to helping millennials succeed in the new economy. We have a presence on over 30 college campuses. And one of our biggest news items right now is that we jut completed our first four credit class at SUNY Purchase, so that's a state university of New York Campus right outside of New York City.

David Grasso:
On my front, we continue to have the Bold Business Show on BoldTV every week, as well as Bookstr business on one of our partner organizations Facebook page, Bookstr where I interview authors who write about entrepreneurship.

Bobbi Rebell:
And they are super interactive. So everyone should try to watch them live on Facebook. You are on Tuesdays at 9:00 AM correct? With Bold Business.

David Grasso:
Yes. And Thursdays 1:00 PM for Bookstr business.

Bobbi Rebell:
And you can always catch them after. But LIVE is always a lot of fun 'cause then you can literally interact directly with the host. And I've even gotten to be a guest host on the show. So definitely check it out and-

David Grasso:
And we'll have to be back soon Bobbi, we're ready to have you back already.

Bobbi Rebell:
Yes, any time. So David, you brought with you a really compelling money story that has to do with your family's immigration to America from Cuba.

David Grasso:
Yeah. You know my family unfortunately after the Cuban revolution was on the wrong side of things. So they made their way to New Jersey right here outside of New York City. They quickly learned that this was the land of opportunity and that they could get ahead really fast. Unfortunately my mother had to grow up very fast because my grandfather died in a factory accident. And one of my mom's most profound memories from her childhood was having to go ask landlord how much the rent was.

Bobbi Rebell:
How old was your mother?

David Grasso:
My mother was about nine years old.

Bobbi Rebell:
She was nine years old when her father passed away and she was taking charge of the family finances?

David Grasso:
Yeah. And if you know anything about my mother, she's a financial wizard. And she's the type that she constantly talks to us about money. And really the most profound lesson that she passed on that came from her father and our ancestors who came to Cuba penniless from Spain and Italy was that making money was never going to be hard. It was hard to hold on to but ... And I can't tell you how often at the dinner table we talk about how we're going to maintain our family's wealth. And how we can save and how we can be defensive consumers to make sure that money isn't coming out of our bank account that shouldn't be going out.

Bobbi Rebell:
So what is your lesson then to our listeners? How can they apply this to their own lives?

David Grasso:
You know, a lot of people focus on making money. "Oh! If I only got a raise I would have more money. Oh! If I only made this much more I would be stable." It never works that way. The lesson I have for the listeners is no matter how much money you make, you can find a way to spend it. What you should really focus on is a savings plan at any level, because as your income goes up, your needs go up as well. So it's very important to put a certain amount aside and further more it's important to watch all moneys coming in and out of your bank account, and making sure that people aren't double charging you, or charging you more than you expected, et cetera. It's important to be a saving consumer as well as a defensive consumer.

Bobbi Rebell:
I like that, defensive. Can you give me an example of how you've been a defensive consumer, David?

David Grasso:
I'll give you an example. You know Time Warner Cable and you know, a lot of these companies, you know, they offer great services, but a lot of times they double dip into your account. Or suddenly your promo ends and then your price goes up two or three times the amount overnight.

David Grasso:
I constantly sit down and watch my credit cards, and watch all those automatic payments. You know, the automatic payments are so convenient, but they can bedevil you financially.

Bobbi Rebell:
Okay David, before I let you go, I want you to share with us a money tip. And I know the different podcast we had David Bock who is well known for talking about the latte factor, which is all about making sure you don't have your money kind of whittle away on the small things. He always keeps reminding me that it's a metaphor, that it's not literal, that people can have their coffee, but it's about the little things. You are not about the little things. You're about the big things when it comes to your money tip.

David Grasso:
Well, I mean I'm holding a latte in my hand right now, so you know, let's focus on the big things. I have an app called Trim. And it really focuses on the big stuff that's coming out of my account. You know, if I had to follow every latte that I spent money on, I would go crazy. So I use an app called Trim. And it shows me major money movements above $250 that come in and out of my account. That way I notice, if my paycheck wasn't deposited. It I didn't pay a bill on time et cetera. If there's too much money. There's never any mystery as to how much money I'm supposed to have in my account.

Bobbi Rebell:
David, thank you so much. That is awesome. I am going to check out Trim right away, and I'm going to definitely keep my eye on the big things in life. Thank you for joining us.

David Grasso:
Absolutely. From one defensive consumer to the other.

Bobbi Rebell:
All right. Here is my take on what David had to say. I was pretty struck by David's passion for being a defensive consumer. Making money is of course meaningless if it all goes flying out the window.

Bobbi Rebell:
So financial grown up tip number one is to fight for your price. Just this week I went to pick up a prescription at CVS. It was replacing a liquid prescription. This was in a tablet form because of manufacturing problems with the liquid form. So this was not my choice. We've been paying $25 a month. CVS rings up the new prescription. Get this guys, $161 and this is not a one time deal, this is monthly.

Bobbi Rebell:
So we called the insurance company, they basically said, "Well, tough luck. It's not on the formula list. So you're stuck. I was really frustrated because number one, it's not my choice. It was literally the same medicine just in a different form. And the doctor had told me the generics were not a good fit. So that wasn't really an option for me. So I was not going to give up.

Bobbi Rebell:
I looked online because I know there are sometimes coupons available for drugs. And I did find one that said up to 84% off. Literally it was 84% off if you qualify. So of course I had to wait on the line again. And I had them ring it up with a coupon this time. And guess what, no, I did not get a huge discount. Nothing. Not only did I not get a discount. They said you have to forego your insurance if you want us to ring it up this way. So I said, "Sure, how much worse could it get?" And you know what it came up as? $354. And by the way this is for 30 tablets, and it's going to be a monthly prescription.

Bobbi Rebell:
I was pretty upset. So I went to the drug company's website. I was thinking maybe I will write a complaint letter, I don't know. But I looked around there, and by the way this was Pfizer to their credit. They have a program where after you get into their system and fill out the proper paperwork and all that stuff you can actually get this medicine for $25 a month.

Bobbi Rebell:
So that is what I did. And after a grand total of almost two hours of waiting in line, calling lots of people, getting codes and so on, lots of back and forth with this pharmacy, another pharmacy, the drug company, the insurance company. It was a mess, bottom line I paid $25 when some people are paying as much as $354 for this same medicine. Fight for your price, please. Take the time and find out, can you get a lower price for something. And especially when it comes to medication these days there are so many changes going on in our healthcare system. Look for everything. And absolutely this was Pfizer, go to their website, see if they have a program for people to get drugs. It does not necessarily ... It's not income based as far as I know this one was not. Look for those opportunities to get the same medicine at a fraction of the price. It's worth it.

Bobbi Rebell:
Financial grown up tip number two. David talked about an app called Trim. Now it helps him with the big stuff. But what I would say to my latte sipping friend is that while you do need to focus on the big stuff to really move the needle in your finances, and to reach big goals like retirement and saving for a down payment and all that stuff, you also should watch the pattern of the little stuff. So, if you're going to have the latte that's fine. But think about the fact that if you are having a latte every singe day, then that does become a big thing. So just keep that in mind.

Bobbi Rebell:
Thank you all so much for taking a few minutes to listen to our show. The feedback and support, truly appreciate it. Love hearing from everyone. Take a moment please to rate and review us on Apple podcast. I keep bringing you these inspiring stories. I hope you enjoyed David Brasso's story and that we all got one step closer to being financial grown ups.

Bobbi Rebell:
Financial grown up with Bobbi Rebell is edited and produced by Steve Stuart and is a BRK media production.

Rebecca Jarvis, ABC News Chief Business, Technology and Economics Correspondent, and Host and Managing editor of the “No Limits with Rebecca Jarvis” podcast learned her financial lessons early.

But the truth about the value of that education really came to light when she learned what was going on with a dear friend.  

You will learn why you want Rebecca, and friends like her, on your team. 

 

Rebecca's money story:

• The  money lessons from her journalist mom that set her on the right path

• How Rebecca has helped her friends who have run into money trouble

• The ways that poor money decisions can hurt your opportunities, including jobs

• How banks sometimes lure young people into borrowing more money than they can afford

 

Rebecca’s lesson: 

• specific tools to figure out wants vs. needs. 

• advice on how to maintain a budget

• her favorite app for managing money

Rebecca’s money tip:

• How to make sure your education pays off

• What kind of classes to take post-college

• To be featured as a women entrepreneur of the week email Rebecca Jarvis nolimitswithrjpodcast@gmail.com

Links to people and things we talked about in this episode

• No Limits with Rebecca Jarvis podcast

• Robin Roberts

• Gabby Bernstein

• Sheila Nevins

• Randi Zuckerberg

• Mint

• CFP Board

• The Federal Reserve

Rebecca Jarvis learned her financial lessons early. The truth about the value of that education really came to light when she learned what was going on with a dear friend. Listen to this Financial Grownup episode to learn Rebecca's advice on how to maintain a budget and her favorite app for managing money. #MoneyManagement #Budget

Transcription

Rebecca Jarvis:
He even had some issues along the way when he was applying to jobs. If they think of you as somebody who's not a credit worthy individual, they can say, "Hmm is this person really responsible."

Bobbie Rabell:
You're listening to Financial Grownup with me, certified financial planner, Bobbie Rabell. Author of How to be a Financial Grownup. You know what, being a grown up is really hard, especially when it comes to money, but it's okay, we're going to get there together. I'm going to bring you one money story from a financial grownup, one lesson, and then my take on how you can make it your own. We got this.

Bobbie Rabell:
Hey friends, welcome to another edition of Financial Grownup. I do want to first take a moment to thank those of you who are already supporting the show through subscribing, and of course through rating and reviewing it. Those early reviews have been so precious to me. They are truly appreciated, and I thank you from the bottom of my heart. If you haven't rated or reviewed the show and you like it, or you just want to give me some feedback, please do so. It means the world to me.

Bobbie Rabell:
All right, this guest is amazing and inspiring. She was spared some of the most damaging early in life mistakes that so many of us make thanks in large part to her mom's early lessons about using credit cards and the dangers of debt. But, here's where it gets really good guys. In addition to learning early on how to be financially responsible herself, what I love about speaking with her and what really comes through in this interview is that she is an empathetic and truly supportive friend. Many of her friends, for whatever reason, didn't have the ideal financial educations or experiences, but she is there for them. She is not judgmental. She is helpful. Rebecca Jarvis is the Chief Business Technology and Economics Correspondent at ABC News. She is also host of one of my personal favorite podcasts, No Limits with Rebecca Jarvis, which you should definitely check out. In the meantime, here is my interview with Rebecca Jarvis.

Bobbie Rabell:
Rebecca Jarvis, you are such a financial grownup and I'm so excited to have you on the program. Welcome.

Rebecca Jarvis:
Thank you so much Bobbie. I'm so excited to chat with you. I love your books. I love you. You set a great example for so many people.

Bobbie Rabell:
Thank you.

Rebecca Jarvis:
So thank you for what you're doing.

Bobbie Rabell:
Well, speaking of great examples, I am such a fan of the No Limits podcast, which is no moving into live events, which is awesome. I mean I could literally spend my entire podcast rattling off all of my favorite episodes. Of course, I love the live show you just did, which featured Robin Roberts, who holds a special place in my heart because she survived a horrible disease that my mother did not survive. Every time I look at Robin I get emotional and happy for her. I love the Sheila Nevins episode, which is dishy. I'm basically telling people to go through your archives. Of course, my friend Randy Zuckerberg, who is amazing. Tell me more about what's going on for 2018 with No Limits.

Rebecca Jarvis:
Thank you. I really appreciate that. We are starting to do more live podcasts. We did this most recent one with Robin Roberts. Also, Gabby Bernstein, which a number of people probably know from the space. She had an awakening, a moment in her life where she hit rock bottom, and she figured out gratitude to come back and be a stronger person. But what we're looking at now is a year ahead where we will be doing some live events. We'll continue to talk to game changing women. That's my mission statement is to talk to women who have broken down walls, who have figured out how to play the game, set the rules, and looking at their paths, the trade offs along the way, the choices that they've made along the way, what success really means to them and how they're figuring out balancing all of it. It's really honest, authentic conversations. My favorite thing Bobbie is when a guest will say, "I've never told this to anyone before." I know we're in the right spot if that's the conversation that we're having.

Rebecca Jarvis:
We'll continue to do that. We also will continue to feature and highlight women from our community who are No Limits entrepreneurs of the week. Every single week we feature a listener who is building an empire of her own, and how she's doing it. She gets featured on her Instagram account, on my Instagram account. She gets featured on the podcast and we share a little bit about her story. Anybody who wants to apply for that can always email me at nolimitswithrjpodcast@gmail.com. Feel free to send me ideas and submissions as well. I do read all of the emails there.

Bobbie Rabell:
Okay, I can't wait to see who is going to be next on No Limits, but I'm also looking forward to your money story. It's a good one, do tell.

Rebecca Jarvis:
Okay. I would say that for me my money story, it started early. My mom is a financial journalist. She's a columnist at Reuters. When I was a kid, she was a columnist at the Minnesota newspaper where I grew up. She sat me down before college. The conversation that we had prior to me leaving for college was all about credit cards. It wasn't your typical going off to college conversation, but she talked me through the idea that when you go to college, and the rules were a little bit different back then, you could be a bank and advertise anywhere on campus for people to sign up for credit cards. She said they're going to be everywhere. They're going to be hounding you. They're going to tell you it's great, it's the best thing in the world. Don't do it. You need-

Bobbie Rabell:
By the way, people should know, no longer allowed, but they were bribing you too probably.

Rebecca Jarvis:
Exactly. Exactly. That's the latest story that just came out that a lot of these banks are now even working with the colleges and giving kickbacks to the colleges. Anyway, my mom sat me down, she had this conversation with me and basically said, "Becky, whatever you do, do not sign up for these credit card offers that sound too good to be true. You don't need to do that. Instead, save your money and think about every penny that you spend is money that's coming out of your savings account. Don't spend money that you don't have." That really made a huge impact on me. I have to say because I now in my life have two credit cards. From that point forward, I was just much more skeptical. I think, I look around at a number of my friends who didn't necessarily have those conversations ... I actually had a really good friend in college who he ran up $10,000 in credit card debt not fully recognizing at the time that he would eventually have to pay that back.

Bobbie Rabell:
Oh no.

Rebecca Jarvis:
And he's a smart guy.

Bobbie Rabell:
And it's not just pay it back. It's pay it back and paying interest.

Rebecca Jarvis:
Exactly, which the interest on credit cards is always going to be the highest interest that you're going to get. It's way higher than the amount of interest that you pay on a mortgage. Way higher than the interest that you'd pay on a student loan. Credit card debt is some of the worst debt that you can take on. Anyway, this friend of mine, his credit score was ruined so he couldn't go out and get a mortgage or a car loan post-college. He also ended up not being able to afford paying off the loans and ultimately his family had to step in and help in. He even had some issues along the way when he was applying to jobs. If they think of you as somebody who's not a credit worthy individual, they can say, "Hmm, is this person really responsible?" He was. He was totally responsible. But anyway, that was a big lesson for me along the way just thinking about debt and my mom sitting me down. I'm so thankful that she did, talking to me about it early on.

Bobbie Rabell:
Besides obviously not getting into credit card debt in college, what is your lesson for our listeners? What is the takeaway?

Rebecca Jarvis:
I think that one of the biggest takeaways is recognizing that no matter how much money you have, or feel that you don't have, budgeting and thinking through your needs versus wants is a really valuable thing. There's research out there that shows that almost every person, whether they have $10 in their pocket or $100,000 in their pocket, is very likely spending more on wants than they're truly aware of. I cover so many stories about people who have gotten out of debt. One of the biggest things that the people who have gotten out of debt have done is they figured out, they've gone through line by line, their spending for the last three months.

Rebecca Jarvis:
They've said where am I spending on my needs versus where am I spending on my wants. One of the greatest things that you can do for yourself is think about what those wants are in the short term, and if you can cut back on those wants, you will make sure that you have the future cushion and money to spend on your needs and to get out of that debt. I think it's a really important thing to budget and to look at needs versus wants.

Bobbie Rabell:
Do you have any specific recommendations for budgeting? Do you budget?

Rebecca Jarvis:
I've done the budget. You literally sit down with your credit card statements and you go through line by line. You can use a ruler to go through line by line. You circle every single time you see something on that credit card statement that is a want verus a need, you circle it. It's a reminder to yourself that those are not the things, especially if you're already in debt, which so many people are. Credit card debt just passed $1 trillion. It's at the highest level, a record level. Going through those credit card statements, circling the wants. You don't have to go out and get an app. You don't have to go out and get some fancy technology to do this. It is really right in front of you right now. Most people have bank accounts and credit cards that are already on the internet, that you can access on the internet.

Rebecca Jarvis:
I really like Mint. I think Mint is a good app where my husband and I have all of our, every single loan, every single piece of money, every single paycheck, feeds into our Mint account so we have a full picture of how much we have, or need to spend towards various areas. I do think that that's a good way, but I don't want people to feel complicated. We don't have to over complicate it. It's as easy as taking a look at that whatever it is, whether it's your checking account, or it's your credit card, and saying where am I spending my money and where am I wasting my money.

Bobbie Rabell:
Right, the numbers tell you the story.

Rebecca Jarvis:
Yes, completely.

Bobbie Rabell:
Before I let you go, I do want you to give us a money tip. Something you or maybe your husband uses. Something that our listeners can put to work right now.

Rebecca Jarvis:
One tip that doesn't relate to debt or any of the things we've already talked about that I really like is if you are spending money, think about how that money can help improve you in some way, education, additional learning, whether it's useful to your community. Those are the areas where that dollar, whatever amount of money that you're putting out there, will come back to you ten X, will come back to you so much, with so much more value than just the single penny or dollar that you've spent. Think about those places, when you are spending, think about those places where it goes beyond that sugar rush of oh I just got this new thing. Think about those areas where if you spend your money on something to make yourself better or stronger, then you will gain so much more from that dollar than if you just spend it on whatever thing is sitting in front of you.

Bobbie Rabell:
Can you give us a personal example?

Rebecca Jarvis:
Well for me, I've spent my money on education. I mean that's probably the biggest thing I've ever spent my personal money on is going to college, taking ... I'm not good. I'm not there yet, but taking Spanish classes. I haven't done this yet this year, but I was looking at different art classes because I really love art and I really would love to be able to create art better. Even things like a gym class, for example, if you feel healthier, and it's something that you feel like you can regularly commit to. I have a group of girlfriends that I work out with now, and I will spend money on those workouts with that group of girls because it has genuinely made my life exponentially better.

Bobbie Rabell:
It's all about experience versus just having more stuff. Thank you so much Rebecca.

Rebecca Jarvis:
Thank you.

Bobbie Rabell:
This was wonderful. Rebecca Jarvis, No Limits. I can't wait to hear all of your episodes for 2018 and beyond. Thank you so much.

Rebecca Jarvis:
Thank you. Have a great day Bobbie.

Bobbie Rabell:
Wow, Rebecca had a lot of great info and advice. Here is my take. I want to pick up on Rebecca's money tip and the importance of investing in yourself through education. I have always done this, and I really encourage everyone to do it as well. Most recently, some of you know this, I became a certified financial planner. It was a huge investment, both in time and money, but I felt strongly that if I was going to be here giving advice I need to know my stuff. Can I be stumped? Well, definitely. You guys will definitely be able to stump me, and I'm still figuring out the new tax law, but after I left Reuters last spring, I did take a break and I got my CFP.

Bobbie Rabell:
Over the years I've also gone back to school when things just didn't make sense, or I wanted to know more. For example, early on at my first job at CNBC I realized I honestly, truly did not understand how the fed worked. It was something that I would go on to write about quite a bit in my career, so I took a class. I kid you not, I literally took a class on how the fed worked, how the federal reserve worked. There is a class on that. It doesn't get nerdier. I even took a class on technical analysis because it was just so strange and I didn't understand it. Still don't get it 100%, but the point is I'm always learning.

Bobbie Rabell:
So how do you make it work, both from a money perspective and a time one? Financial grownup tip number one, get someone else to pay for it. If you work for a large company, odds are they have a program to reimburse tuition. Some may require good grades. All the better. Incentives are good. If they don't have a program, ask your boss if the company can pay for a course. Explain how improving your knowledge will ultimately benefit the company. For example, if you want to learn a language like Spanish or Mandarin, you could help the company break into markets where that language dominates, or maybe open up an office in another country. Find a way to make your case and get them to pay for it. If not, there are nonprofits that support continuing education, as well as government programs. Do some homework, find the money.

Bobbie Rabell:
Financial grownup tip number two, and this one is harder. Find the time. We are all so busy. Finding time for something that seems like an extra may seem like a non-starter. I had this problem when I decided I was going to write my book. I had a very demanding job, and was barely seeing my family as it was. I would get home literally just in time to tuck my son into bed before I ate a quick dinner and crashed for the night exhausted. I mean I couldn't even get to the mail pile. But then, I thought about it. I decided I was going to write this book and I was going to find the time. But where?

Bobbie Rabell:
Well, I found the earliest time I could drop my son off at his school, and even if I had a ton of work and a huge busy day ahead of me, I did not go into the office early. I created a window of time between school drop off and my job, my primary job, and stuck to it as a protected time. No plans with friends. No grabbing coffee with the other moms. No doctors appointments. No phone calls. Just the book. And it worked. Find the a time slot that you can carve out and then protect it like a beast. It works.

Bobbie Rabell:
All right, that wraps up this episode of Financial Grownup. Thank you again for all of your support. If you like the show, or just want to give me some feedback, please rate and review it in iTunes, and of course share it with your friends. I truly appreciate all of your support.

Bobbie Rabell:
Financial Grownup with Bobbie Rebell is a BRK Media production.

Even the best money experts can make money mistakes. For nine-time New York Times best-selling author David Bach, it happened in college.

It is not that surprising that he got buried in credit card debt. That happens to a lot of students who get tempted by the easy credit available. But after paying off his debt, David went back and did it again! 

Things get really interesting when he goes to his parents to ask for help.

In this episode you will hear

David Bach’s Financial Grownup money story including:

• How David Bach got into credit card debt- twice- before even starting his independent adult life

• The tactic the credit card companies used that led to even more debt

• How David’s parents reacted when he came clean about his debt

• The common mistakes college students make when it comes to credit cards

• How that debacle actually led to his beginnings as an entrepreneur as a sophomore in college. 

• What David’s first business was and how it helped him get out of debt

• How Bach learned to automate his savings and investing

• How he has used those early in life lessons to build his own wealth, and teach others as well

David’s Financial Grownup lesson including:

• How damaging credit card can be

• Ways to avoid credit card debt

• Why he has not carried credit card debt since age 21

• How he has avoided borrowing for 3 decades

David’s personal finance tip:

• Why automatic payments are great for investing, but not always for bill paying

• The first thing david cut from his budget in 2018.

• How to decide what to cut from your automatic payments

 

In my take you’ll hear my controversial advice on credit card debt including when to use:

• The avalanche method

• The snowball method

• How and when to use your home equity as a resource

• How and when you should consider opening up a zero interest credit card

 

Links to things mentioned in this episode:

David Bach

Smart Couples Finish Rich

AE Wealth Management

Even the best money experts can make money mistakes. For nine-time New York Times best-selling author David Bach, it happened in college. It is not that surprising that he got buried in credit card debt. Listen to the Financial Grownup podcast on ways to avoid credit card debt. #CreditCardDebt #FinancialGrownup #Money #Author