Paulette Perhac:
“The Big Life” author and former Seventeen Magazine Editor-in-Chief Ann Shoket’s boss literally mocked her when she asked to get paid more as a young magazine editor. Now, she knows better. Ann shares the one thing she does to find out what to ask for in negotiations, and how she leverages it to make more money.
In Ann’s money story you will learn:
-How as a young magazine editor, Ann loved her job, but her compensation was not in line with her contributions.
-How Ann prepared to approach her manager about a raise
-The shocking reason the manager denied her request
-The uncharacteristic response Ann gave to his pushback
-Exactly what Ann would do if she could do it over
In Ann’s lesson you will learn:
-How the resources of today could have helped Ann get that raise
-The specific advice Ann offers millennials
-Where and how exactly listeners can get the information they need to better negotiate
-How to find out what you are worth in the job market
In Anne’s money tip you will learn:
-The best way to approach colleagues and friends to share salary and compensation information
-How e-mail vs IRL compare in sharing sensitive information about compensation and other career advice
-Why it is so important to Ann that she help other women
-The specific language Ann uses in her conversations about money and other compensation with her peers
-How to handle issues of competition with peers and colleagues after sharing information
-What Ann learned from millennials about transparency
In my take you will learn:
-The importance of creating networks and career allies to share pay and other relevant information
-How to decide and communicate boundaries regarding the information
-How to decide if it is best to share information over email or IRL
-The importance of security when sharing sensitive information online
Episode Links:
Ann’s Ted Talk: Why We Should All Be More Millennial
Anne’s book The Big Life: Embrace the Mess, Work Your Side Hustle, Fie a Monumental Relationship and Become the Badass Babe You Were Meant to Be
Anne's website:
AnnShoket.com
Follow Ann!!
Twitter @annshoket
Instagram: @annshoket
Facebook Ann.Shoket
LinkedIn Ann Shoket
Transcription
Bobbi Rebell:
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Ann Shoket:
He looked at me and he said, "You know Ann, you don't go into journalism to get rich." I was so stunned. I wasn't asking to get rich, I just wanted to pay my bills.
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 everyone. So this episode is going to be a treat and perfect for anyone that feels they could, and let's face it, should, be earning more money. You may have a boss you need to convince or you may have your own business and need to figure out how to charge your clients more and grow your business. Ann Shoket is a big name. She first became famous as the editor-in-chief of Seventeen Magazine and was named by Forbes to be one of the most powerful U.S. fashion magazine editors. More recently, she penned The Big Life and started a Badass Babes community. And being a badass herself, she also has an amazing TED Talk called Why We Should All Be More Millennial. Which brings us to the advice she is going to share, because it is about using that idea to get paid more money. Here is Ann Shoket.
Bobbi Rebell:
Ann Shoket, you are a financial grownup. Welcome to the podcast.
Ann Shoket:
Oh, I'm so excited to be here.
Bobbi Rebell:
Congratulation on your massive bestseller, The Big Life, and more recently your TED Talk, which I've now watched a number of times. You are literally the Jane Goodall of millennials, so I'm so excited to be talking with you.
Ann Shoket:
Thank you. I have devoted my career to understanding millennials and supporting them and helping them find their power.
Bobbi Rebell:
Which brings us to the money story that you're going to share, which really has to do with trading money for meaning at work. Because of the importance really of meaning, because we spend so much time at work.
Ann Shoket:
So when I was sort of mid-level editor coming up in the world, just past the stage of eating ramen and scrounging and going to happy hours to have dinner, where I had some experience under my belt and a little bit of a salary, I was creating new content for my company and doing great innovations and I wanted to get paid more. And I remember I walked into my boss and I came in with a list of things that I had achieved, I'm no dummy, you know, you come in with these [crosstalk 00:03:09].
Bobbi Rebell:
So you were prepared, right.
Ann Shoket:
It wasn't entitlement, I was prepared for this conversation, and he looked at me and he said, "You know Ann, you don't go into journalism to get rich." And I was so stunned. I wasn't asking to get rich, I just wanted to pay my bills. And frankly, I wanted to get paid for the work I was doing and for the good work that I knew I was bringing them. And I remember feeling instantly small, as if I had asked for too much or my ambition was too obvious, and I backed off of my request. I felt small, I retreated. He made me feel like I should feel lucky to be in that position. And maybe it's true, it's a competitive world that we're in-
Bobbi Rebell:
But you had worked for that position. I mean, yes, many other people would love to be in that position but you had earned it and you were working.
Ann Shoket:
And probably the worst part is I loved my job, I really did and he knew it. I loved my job, I was engaged, I was doing good work, I was doing work I felt was meaningful. I was on my path to finding what felt like my purpose, I was doing something real. And he used that to make me feel small in a salary negotiation and I didn't go for the big dollars and I didn't push hard and I backed off immediately. And could I do it all over again, I might have left that meeting, gone back to my desk, and then come back with a nuts and bolts, "Here's what other people are making in my position." It was at a time where frankly we didn't have Glass Door, we didn't have a million ways to check our salaries, so I didn't know what other people were making.
Bobbi Rebell:
Well, was it that other people were making more or that they were just paying you very little? We don't really know I guess, we don't know.
Ann Shoket:
I don't know.
Bobbi Rebell:
We don't know.
Ann Shoket:
I don't know. But had I had the resources available that we have today and had I had the benefit of greater perspective on the world, I would have taken that moment and figured out how to get paid what I thought I deserved at that time. I would have really pushed for it rather than feeling small and retreating.
Bobbi Rebell:
So now we are years later, you are the voice for so many millennials, you are teaching them so much. What is your lesson from this that you would share to them if they find themselves in a similar situation?
Ann Shoket:
Knowledge is power. So if you know what other people at your level, in your company, who sit next to you in the competitive company, are making then you have a much greater leverage to get paid what you deserve. Women say to me all the time, "I just want to get paid what I'm worth," and I am like, "That's great, except for how do you know what you're worth?" And the only way to know is to share your salary information.
Bobbi Rebell:
Right.
Ann Shoket:
If you walk away from this interview right now with only one thing, it's share your salary information with a trusted colleague, someone who sits next to you, your regular lunch buddy, but share your salary information. It's not gratuitous, it's not for gossip purposes, but it's so that you know and are better prepared when you go into your own salary negotiation.
Bobbi Rebell:
So sticking to this theme for your money tip, you've talked about sharing your salary information but are there specific ways and specific resources that you can tell people about that can accomplish this goal? Because it's a little bit awkward to just go up to people and say, "Oh hey, tell me what you're making and I'll tell you what I make and it will be all good." I mean, how do you actually ... Are there certain things that you look for with someone that you feel you can trust them? Are there websites you can go to, are there chat groups? Specifically how does this happen? Because it's awkward, right?
Ann Shoket:
It is awkward and I'll tell you, the first time that someone asked me to ballpark my salary for them it came in an email-
Bobbi Rebell:
And was it a close friend, was it someone you knew well?
Ann Shoket:
It was a colleague.
Bobbi Rebell:
Okay.
Ann Shoket:
Not a close friend. It was a colleague and we had been supportive of each other over the years. And at first I was so shocked, I was like, "Can you believe the nerve of this woman! I would never share my salary information with her!" And I calmed down and tried to get a little perspective and I gave her some sort of halfway information that she may be able to use, I didn't go all the way.
Bobbi Rebell:
In writing, in writing.
Ann Shoket:
I did, I emailed her back in writing.
Bobbi Rebell:
Okay.
Ann Shoket:
However, if I did it again I would 100% ballpark and tell her the number. I was so stunned by it but I realize she was so ahead of the curve in even asking. And I have since been in a position to help other women where I've talked about what I got paid and about the ins and outs of my book deal to help other women in getting their book deal. I have had women who have helped me as I've been building a speaking practice, women who've been tremendously supportive, because it's all brand new.
Ann Shoket:
You know, one of the things about having careers that are more complicated and more evolved than we ever planned for is that suddenly you're being thrust into totally new arenas and you have to figure out how to take the skills that you have but make them work in new places and in new ways. How do you do that unless somebody gives you the lay of the land? And so that's another piece of this sisterhood, this idea that we should all support each other so that we can rise together as women and be collaborative and powerful.
Bobbi Rebell:
I mean, just to be specific about this, how do you know when it's okay to trust somebody or do you try to ... You were comfortable doing it in an email, you don't feel you have to pick up the phone or meet someone in person.
Ann Shoket:
I think when you're talking real numbers, I think it's okay to send an email that says, "Hey, can I talk to you about this? I'm interested in finding out what you charge or how you got paid or how the deal went down," in an email, to be clear about what it is that you're asking them. But then to have the real nuts and bolts money conversation in person, I think is probably smart. That's how the last couple of conversations that I've had have gone. But I think it has to be someone you trust, who's not going to feel competitive, someone who's going to give you good, smart information. And I think that you find those people in your network, maybe they're not someone who sits next to you at work, maybe it's not your work wife, although you probably should share some of this information with your work wife. But it is people who are going to be in your life for a while, right?
Bobbi Rebell:
Right.
Ann Shoket:
You're going to see them at industry events, you're going to be up for the same jobs, you're going to see them schmoozing here and there, you're going to see them at parities-
Bobbi Rebell:
What do you do if you find out that there's a big disparity?
Ann Shoket:
I think the only thing to do ... I mean, yes, maybe it's awkward with the two of you but I think it's better to say now you know and now you can go to your boss and let them know that you know and to be clear. One of the most interesting things about this transparency that millennials have brought into the world is that Gen Xers are so supremely uncomfortable with it, we think it's TMI and that it's oversharing and that the system, sort of old systems, are set up to keep you in line and to keep you not knowing. And those don't really serve us moving forward, the transparency that millennials are demanding is going to become second nature for all of us. And so I think it's a smart company that honors this kind of transparency rather than shuts it down.
Bobbi Rebell:
Well said. All right, Ann Shoket, I know that you are so busy on the speaker circuit and with all of your projects. Tell us more about what you're up to these days and where people can find you.
Ann Shoket:
So since the TED Talk, Why We Should All Be More Millennial, I have actually been doing a ton of speaking. It is, in so many ways, a love letter to millennials, to a generation that I believe is going to lead our future and is changing the way we define power and success. But it's also incredibly important for boomers and Xers, and there's this real tension at work between boomers and Xers and the millennial employees that are coming up behind them. And it is my goal to make everybody come together so that we can rise together as women.
Bobbi Rebell:
So where can people find you?
Ann Shoket:
Annshoket.com is the best, fastest way to find The Big Life, to find my speaking, to find my TED Talk.
Bobbi Rebell:
Which is awesome, by the way. And on social media?
Ann Shoket:
Annshoket.com on Instagram, ann.shoket on Facebook, annshoket on Twitter. You can find me everywhere, I'm very easy to find. A-N-N, S-H-O-K-E-T.
Bobbi Rebell:
Awesome. Thank you so much, this has been amazing.
Ann Shoket:
Thank you Bobbi, I love it.
Bobbi Rebell:
I love how direct Ann was, I feel there were a lot of takeaways but this is what I'm going to focus on. Financial grownup tip number one, create networks and career allies to share pay and career information. But this is what I'm adding, treat it kind of like any successful relationship, in that you need to respect the boundaries and you also need to respect that even though you're being transparent with each other that doesn't mean that the information goes beyond that relationship, you need to respect the other person and their privacy. Be sure to vet someone also before you reveal too much, and keep the information that is said between the two of you, or the group, private unless it is clearly agreed that it is for public disclosure. Ann and I have shared career information and goals, but that remains private.
Bobbi Rebell:
Financial grownup tip number two. When you have these conversations, Ann points out that while you can initiate via email, you should have the real conversation in real life, in person, face to face. Meeting in person is worth the time, at the very least, do it by phone. On your end, you don't want to create a paper trail with information that you don't want to go beyond the intended recipient. No matter how well-intentioned they are, things happen, be secure with your information.
Bobbi Rebell:
Okay. The minute this podcast is over, I want everyone to go listen to Ann Shoket's TED Talk, Why We Should All Be More Millennial. I will leave a link in the show notes. Then check out her book, The Big Life, and follow her on social media. I want to hear your money story and get some great money tips from you, our listeners. We are going to be starting having one episode a month be a listener as our guest. If you want to be considered, email us at info@financialgrownup.com and tell us what money story, lesson, and money tip you would share.
Bobbi Rebell:
Thank you all for your support. If you like what you are hearing please don't forget to hit the subscribe button so you won't miss any upcoming episodes. And of course, rate and review the show, especially on iTunes. Anywhere is good, but especially iTunes so more people can learn about the show. And on that note, please share this with a friend so we can share these stories with more people and help them live richer lives. Follow me on Twitter @bobbirebell, on Instagram @bobbirebell1, learn more about the show at bobbirebell.com/financialgrownuppodcast. I adore Ann and I hope you do now too. It was a great episode and here's to us all getting 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.
Kristin Wong laughs about it now but she literally cried and wanted to drown her sorrows at TGI Fridays when an unexpected tax bill hit her out of the blue. She fesses up to Bobbi that it never occurred to her that she would not get a refund. Ironically, her money tip is one for the budget conscious foodie in all of us.
In Kristin Wong’s money story you will learn:
-Why she did not pay her taxes when she started freelance writing
-How your tax responsibilities change when you switch from being an employee to being self-employed
-Why she owed money instead of getting her usual refund
-The benefits of having an emergency fund
-The emotional toll it took on Kristin
In Kristin’s money lesson you will learn:
-The big mistake Kristin made regarding money when she became a freelancer
-Ignorance is not bliss when it comes to taxes
-Kristin’s tips for managing major work changes
-How to find free resources online to manage and pay your taxes
-How to know when you need a professional for your taxes
In Kristin’s money tip you will learn:
-The high/low method for restaurant spending
-The most expensive/biggest splurge meal Kristin has had
In my take you will learn:
-What happens if you send in your tax returns without payment
-What to do if you do not have the money to pay your taxes on April 17th
-Strategies to use when you set up a payment plan with the IRS
-Why you should avoid paying your taxes with a credit card
Episode links
Pickup your copy of Kristin Wong’s new book Get Money
The book website is at: https://thegetmoneybook.com/
Get Kristin’s downloadable worksheets at https://thegetmoneybook.com/worksheets/
Kristin Wong’s website is https://www.thewildwong.com/
Follow Kristin!
Facebook- (and join her private facebook group): https://www.facebook.com/thewildwong/
Twitter @thewildwong
Instagram: @thewildwong
Pinterest thewildwong
YouTube The Wild Wong
Other links:
IRS.Gov
TurboTax.com
Vanguard.com
https://www.irs.gov/newsroom/what-if-i-cant-pay-my-taxes
https://www.irs.gov/payments/direct-pay
Cary Carbonaro
Stefanie O’Connell
Holly Hanson
Get Rich Slowly
JD Roth
Transcription
Kristin Wong:
So, I just cried. My now husband, who was my boyfriend at the time and he was like trying to calm me down. He was like, it's going to be okay. I just remember like I wanted to go to TGIF Fridays.
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 and make it your own. We got this.
Bobbi Rebell:
Hey friends, spoiler alert, our guest Kristin Wong author of "Get Money" was crying because of something that happened to her at tax time. And I thought this would be a great time to hear her story about the time she, oops, forgot to pay her taxes. So her book, as I mentioned is called, "Get Money. Live the Life You Want, Not Just the Life You Can Afford." It makes learning about money feel like a game, which she really could have used her own book at this time because it was not a fun time.
Bobbi Rebell:
You've probably read Kristin's work in the New York Times, New York Magazine, Glamour, Life Hacker. Kristin got her start as a money writer at the fantastic blog, "Get Rich Slowly." This is a story you need to hear, especially right now at tax time. Here is Kristin Wong.
Bobbi Rebell:
Hey, Kristin Wong. You're a financial grownup. Welcome to the show.
Kristin Wong:
Thank you for having me on the show.
Bobbi Rebell:
I am loving your new book, "Get Money. Live the Life You Want, Not Just the Life You Can Afford." Full disclosure, I'm only about two thirds of the way through, but I will be finishing it very soon. Great job.
Kristin Wong:
Thank you.
Bobbi Rebell:
It's not easy to say something new in this space and you really did it.
Kristin Wong:
Yeah. And I've been writing about money for so long that it was kind of hard to say something new. So I really had to think about it for ... I had to take myself out of the money geek persona.
Bobbi Rebell:
You're not a geek. You're the cool money nerd.
Kristin Wong:
All right. I'll take it.
Bobbi Rebell:
You're the cool friend, talking about money and we have cool stuff to talk about. Your money tip is super cool, but before we do your money tip and that's a teaser for all the foodies out there, we're going to do your money story, which is so appropriate, because this is going to come out in April, which is our favorite month. Not. Because we talk about taxes and your money story is about the fun world of taxes. Tell us, Kristin.
Kristin Wong:
Oh man, I have a crazy tax story. When I first started freelancing six or seven years ago, I was full time freelancing and everything was going fine. I wasn't making that much money because I was new at it. I had no idea that you had to pay estimated quarterly taxes. It's just not something that I paid attention to. I was so used to having an employer take out taxes for me. So in April I decided to do my taxes, which usually I liked doing taxes because-
Bobbi Rebell:
Well, you were probably getting refunds. You were getting refunds when you worked for an employer.
Kristin Wong:
Exactly.
Bobbi Rebell:
So this was the time you would be getting like a bonus.
Kristin Wong:
Right. So I was looking forward to all this money coming in, thinking what I was going to do with it. But nope. I had a $5000 tax bill. And some of it was penalties but it was mostly, I hadn't paid any of my taxes. And the fact that my taxes were only $5000 should tell you that I wasn't making that much. I had an emergency fund, thankfully and it just depleted my emergency fund.
Kristin Wong:
I remember, I had just moved to Los Angeles and I was proud of myself for finding a job here and I was a writer and I was making it at work, and I had an apartment, and I just remember-
Bobbi Rebell:
You were very grown up except for one thing.
Kristin Wong:
Except for the taxes. Well I just cried. I remember it was a Friday night-
Bobbi Rebell:
Did you just literally cry? You actually cried?
Kristin Wong:
I cried. I did because it was just-
Bobbi Rebell:
Was there witnesses?
Kristin Wong:
My now husband, was my boyfriend at the time and he was like trying to calm me down. He was like, it's going to be okay. I just remember like I wanted to go to TGIF Friday that night.
Bobbi Rebell:
And spend more money.
Kristin Wong:
Yeah. I was like, I want to do it. Let's go to TGIF Friday.
Bobbi Rebell:
Now did you have everyone helping you? Did you just go to a tax preparer? What happened?
Kristin Wong:
No.
Bobbi Rebell:
How was this all discovered?
Kristin Wong:
I just wasn't prepared at all for it. I thought, you know I've always been when of those type of people, I'll just say yeas and figure it out later. And that can definitely work in my favor, but this time it did not. I was unprepared for the freelance life and the massive change. Like how different it is financially.
Bobbi Rebell:
All right, so let's talk about the lessons. What are the lessons, besides know whether you're paying taxes or not.
Kristin Wong:
Right. I'd say the lesson is just don't ignore money. Like I just ignored what it took to be a freelancer financially and I ignored all of that. And I think a lot of people do that. We don't like to think about money. We don't want to figure out the practical side of things. So we just kind of sweep it under the rug. I think a lot of people even take it further. They don't look at their budget or they don't look at their credit card statements, and that really was a game-changer for me because this was pre-writing about money days.
Kristin Wong:
But I really realized, nobody is going to care abut your finances. Nobody's going to hold your hand and walk you through it. And if you don't take care of it the somebody else will. Well if you don't care of your money somebody else -
Bobbi Rebell:
Somebody else will take it, somehow.
Kristin Wong:
They'll take it.
Bobbi Rebell:
It there like a checklist of things? So number one would be, be aware of taxes that you may owe. And if you're just starting out the truth is, you may earn so little money that you, especially with the new tax system, under a certain amount you may not even owe taxes. But you just need to figure out if you do.
Kristin Wong:
Right. And I would say, if you're going through a major work change like that, where your status is changing from full time to freelance, if you can afford it, go to a tax preparer and have them kind of walk you through the process. But at the very least, always research what your financial situation is going to look like if you have a major life change, especially when it comes to taxes. There are a lot of free resources on line, but I would say if you can afford it you certainly want to go to a professional.
Bobbi Rebell:
Are there some resources you can recommend?
Kristin Wong:
Yeah. The IRS.gov website is actually pretty great. They have a lot of resources for freelancers and independent contractors and that sort of thing. And Turbo Tax, their website actually has a lot of useful information. So I would check out those two resources.
Bobbi Rebell:
Let's go to the money tip because I teased it a little bit earlier. I love this Kristin. This is one for the foodies.
Kristin Wong:
Yes, so it is ... My money tip is the high, low method for restaurant spending. And I actually read this tip from a restaurant critic on line. And he or she, I don't remember, this was a long time ago, basically said don't go to any middle of the road restaurants. Save your budget. Spend it mostly on hole-in-wall, cheaper restaurants because they are usually mom and pop owned and the food is really good and they stay in business because the food is really good.
Kristin Wong:
You're going to save money going to those cheaper restaurants and then use that to splurge every now and then on a really high-end, nice restaurant that's known for their cuisine. So his or her tip was, basically just avoid any middle of the road restaurants. And so if you are going to go out six times a month on restaurants, go to the cheaper places five times and then save your sixth splurge restaurant meal for a nicer high end restaurant.
Kristin Wong:
The idea is, those middle of the road restaurants ... I mean there are some exceptions to this. This is a generalization, but they're usually like, the food is very mediocre, and your not getting the most bank for your buck.
Bobbi Rebell:
Right.
Kristin Wong:
But you will get the most value from the high, low method.
Bobbi Rebell:
Right. And you're usually just avoiding cooking at home because you just don't feel like it.
Kristin Wong:
Yeah.
Bobbi Rebell:
Hey, let me ask you ... So you talk about splurge. What is the most you've ever spent on one meal out, Kristen?
Kristin Wong:
Oh my gosh. I've told this story before but I ... I still I feel guilty about this but I spenT $40 on a steak once. And I don't know what I was thinking. I think that I had been ... My lifestyle-
Bobbi Rebell:
So the entrée was $40? The entrée. But that's not that bad.
Kristin Wong:
Yeah, but-
Bobbi Rebell:
Obviously there were other things to the whole meal.
Kristin Wong:
Yeah.
Bobbi Rebell:
What do you think the whole meal cost you, then?
Kristin Wong:
I was with a friend so we split it. But it was probably like $50, $60 for one person. And I had never spent that kind of money before. That's the thing. I grew up in a lower income household so $40 on steak. If my parent found out about that, they would slap me silly.
Bobbi Rebell:
All right. You haven't spent that much time in New York City, but maybe that's a good thing. New York City is not very budget-friendly. All right. We are never going out for steaks together. We are going to have some plain, simple coffee.
Kristin Wong:
I like the steaks, though.
Bobbi Rebell:
Yeah. Maybe we'll make steaks at home. That sounds like a good plan. All right. Thank you so much. I want to talk about your book quickly before I let you go. "Get Money." This is a good book. It is a paperback. I now carry it with me because it's like little nuggets of money tips and little things like what you just said about the restaurants. So many brilliant musings on money. Tell us a little bit more about it.
Kristin Wong:
Yeah. Well, it's a very actionable and interactive book so there area lot of exercises and there are a lot of assignments in it. You have to do work when you're reading it, so I would read it with a pen or pencil in hand. You can also go on line. There is an accompanying website to the book, called Thegetmoneybbok.com or you can find worksheets in like video tutorials for it, because I think sometimes with these money concepts, somebody tells you how to open a retirement account.
Kristin Wong:
And you're like, okay that sounds well and good when I'm reading it but when I go to the Vanguard website I have no idea how to get started. So I actually show you in some video tutorials exactly what you need to do to get started, so you have no excuse not to get your money in order.
Bobbi Rebell:
And there's a lot of value out of this book, because you quote so many of my favorite people, Cary Carbonaro. You quote Stephanie O'Connell, Holly Hansen, so many brilliant money minds are in here. It's great, so congratulations on the book. Where can people find you and what else are you up to?
Kristin Wong:
I am at the WildWong.com, is my website and all my social media handles. And I just sort of write about, of course personal fiance, but also resources for freelancers and that sort of thing too.
Bobbi Rebell:
Cool. And your background, by the way is so cool. You were a movie writer, a TV writer. So interesting.
Kristin Wong:
Thank you.
Bobbi Rebell:
Just quickly, how did you fall into the money stuff?
Kristin Wong:
Well I was actually writing full time freelance for about dating and relationships when I started writing about money. I actually started writing at "Get Rich Slowly', J.D. Roth's blog. I have always been fascinated with money. That's a longer story. But I would read his blog every morning and then one day he said that he was hiring writers, so I just applied to be a freelance writer and I started kind of blogging about ...
Kristin Wong:
Like I would write essays about my own dysfunctional relationship with money and I really just, I figured out how to get money through just writing about it for five years. So I wanted to share that knowledge with other people.
Bobbi Rebell:
Well, we appreciate it. Kristin Wong, thank you so much.
Kristin Wong:
Thank you.
Bobbi Rebell:
Much as we hate to deal with it, taxes are a reality of being a financial grownup. Here's the thing. Kristin was able to contain the damage of not filing quarterly taxes as a freelancer because she had the cash in an emergency fund. So great. There were some consequences, but all things considered, Kristin made the problem go away. In reality that is not always the case. In fact, I'm going to bet, very often it's not the case, so what do you do if you don't have the cash?
Bobbi Rebell:
Well, first of all, financial grownup tip number one. No matter what, you still have to file the paperwork on time. Now you can file an extension if you just want to procrastinate and not even figure out what you owe. But you got to figure out some kind of idea, because they're going to start penalizing you and you're going to be paying interest on what you owe. So when you do pay it, it's going to be so much more.
Bobbi Rebell:
The money is due April 17th. Now, as Kristin said, the IRS.gov website can very easily walk you through all of this. They even have an IRS direct pay area of the website, where you can easily pay tax estimates. I'm going to leave a link to that in the show notes.
Bobbi Rebell:
Financial grownup tip number two. Okay, let's say you literally do not have the cash. You need to get in touch with the IRS and you need to get on a payment plan. They can even give you extensions if you literally don't have the ability to pay anything right now. I'm going to give you a phone number to the IRS. 1-800-829-1040. 1-800-829-1040. Call them up, They will work out a plan.
Bobbi Rebell:
Be nice. The whole point is you're talking to a human being. You can be reasonable. They want to get their money and they want to get it consistently in a way that you're going to be able pay. So they're going to be flexible. In fact, they can often waive the penalties. Not only the interest on the money you owe, but the penalties. So ask.
Bobbi Rebell:
I do not recommend putting it on a credit card. In almost every case, unless you hae a 0 interest credit card, in almost every case the IRS, even with penalties will be less than the interest on a credit card. If you enjoyed this episode, subscribe and consider writing a review on Apple Piecasts, aka iTunes.
Bobbi Rebell:
It helps the show get discovered so we can share more money stories and tips and be in touch. On Twitter, I'm @BobbiRebell. On Instagram at BobbiRebell1 and Bobbi Rebell on Facebook. And to learn more about the program and to get on our mailing list for bonus content and more go to BobbiRebell.com/FinancialGownuppodcast. I hope you guys enjoyed this episode with writer and money expert Kristin Wong. Get her book, "Get Money" and here's to us all getting always bit 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 !
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.
MSNBC Your Business host JJ Ramberg didn’t just love Ben & Jerry’s ice cream growing up.
She loved their mission. That led not only to her career interviewing entrepreneurs on television but to her own socially responsible ventures including Goodshop and The Startup Club.
In JJ’s money story you will learn:
-How Ben and Jerry’s Ice cream inspired JJ’s business with her brother called Goodshop
-How her business supports non-profit causes
-How to use GetGumdrop to support causes you care about
-How her ventures have raised nearly $13 million dollars for non-profit causes
In JJ’s lesson you will learn:
-How to balance being socially responsible business with profitability
-Why JJ believes corporate sustainability starts with focusing on secure jobs for employees
-When NOT to give directly to charity
In JJ’s money tip you will learn:
-How JJ’s new spending categorization strategy is helping her save money
In my take you will learn:
-How to balance supporting your business with supporting causes you believe in
-No-cost ways to support charities you believe in
Episode Links
Learn more about
JJ Ramberg on MSNBC
Been There Built That podcast
Your Business with JJ Ramberg on MSNBC
The Startup Club book
Goodshop
GetGumDrop
Ben & Jerry’s Ice Cream
The Body Shop
Patagonia
Amazon Smile
Bidding for Good
Follow JJ Ramberg!
Twitter @jjramberg
Instagram @jj.ramberg
Facebook JJRamberg
MSNBC Your Business host JJ Ramberg didn’t just love Ben & Jerry’s ice cream growing up. She loved their mission. That led not only to her career interviewing entrepreneurs on television but to her own socially responsible ventures. In this Financial Grownup podcast episode we also discuss no-cost ways you can support charities. #CharityIdeas #GiveBack
Transcription
JJ Ramberg:
The most socially responsible thing you could do is make sure your employees have a job tomorrow and treat them well, whatever that takes.
Bobbi Rebell:
You're listening to Financial Grownup with me, certified financial planner Bobby 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:
Wise words from this episode's financial grownup. She is JJ Ramberg, host of Your Business on MSNBC. JJ has been talking to small business entrepreneurs for more than a dozen years. JJ also hosts the Been There, Built That podcast, and she has a few pretty significant side hustles that she herself has been building including a fantastic plug-in app called Goodshop and a young adult book project with her sister that she will tell us about. Here is JJ Ramberg. JJ Ramberg, welcome. You are a financial grownup. Great to have you.
JJ Ramberg:
So happy to talk to you, Bobbi.
Bobbi Rebell:
You have your own new podcast and a new book to talk about. Tell us more.
JJ Ramberg:
I do. There's a lot going on. We've recently a few months ago launched our podcast Been There, Built That. Basically, I've had this show on MSNBC for 12 years called Your Business.
Bobbi Rebell:
Longest running show, right? Is that the longest running show on business?
JJ Ramberg:
It's the second longest running show after Chris Matthews, after Hardball. I know.
Bobbi Rebell:
That's the longest business show.
JJ Ramberg:
Yeah, for sure. It's crazy. I think it's the second longest running female anchor.
Bobbi Rebell:
Awesome.
JJ Ramberg:
Maybe first female, I don't know.
Bobbi Rebell:
Let's just go with first. Let someone correct us.
JJ Ramberg:
Exactly. I've had this show on MSNBC for 12 years about growing businesses. We just launched the podcast because on this show I get three minutes to talk to people. I always get to talk to them much longer in the green room and at coffee. The podcast is my chance to now get those conversations out to our audience too.
Bobbi Rebell:
You also have The Startup Club.
JJ Ramberg:
The Startup Club was my side passion project that I did with my sister. It's a fiction book for kids about kids who start businesses. It's a typical book for grade school kids, like two best friends start a business. The mean girl in school copies them. They get in a fight. The brother gets involved, all this stuff. Through it, they learn what's the difference between profit and revenue, and what is marketing, and all kinds of business things, which tap into kids' general interest at this age anyhow.
Bobbi Rebell:
Kids are curious. My son is very curious. I have a ten-a-half-year-old. He is very curious about business. I am definitely going to check that out with him. You also, speaking of kids, when you were a kid, you loved ice cream. It was memories of Ben & Jerry's that inspired your money story that you're going to share with us.
JJ Ramberg:
It was. When I was growing up I was really taken by the idea of socially responsible businesses. In those days it was Ben & Jerry's, all the good that they were doing, and The Body Shop when it first started, and Patagonia. I thought when I'm older, even just as a kid, I thought I want to do something that is business because I come from a family of business owners and incorporates doing good. Cut ahead many, many, many years, and my brother and I came up with this idea called Goodshop, which was we partnered with thousands of stores. You'd shop just like you normally would. We'd get you all the best coupons and deals for those stores, but you can select your favorite cause no matter what it was. A percentage of what you spend goes back to that cause.
Bobbi Rebell:
That's awesome. Now there are extensions.
JJ Ramberg:
Now we have the Gumdrop extension. You don't even have to worry about putting the coupon in or choosing your cause every time. You just go to getgumdrop.com and add the extension. It automatically puts the best coupon in at checkout. If you select a cause, a percentage of what you spend will go back to that cause. We've raised nearly $13 million for causes so far.
Bobbi Rebell:
Amazing. What is your lesson for want to be entrepreneurs who also want to be doing good? How do you actually execute this? This is an 11-year overnight success.
JJ Ramberg:
Twelve, actually.
Bobbi Rebell:
Yes, 12. Oh my gosh, 12.
JJ Ramberg:
Yeah. It's interesting. I get this question a lot from people. As you can imagine, because of the show, I meet so many founders and people who want to start companies. Because my company is socially responsible, I get the question. My thought is Goodshop was born originally on this premise of let's give away our revenue when people choose causes. It was baked into what we were doing. That's why we launched it in the beginning, but not every company is like that, and not every company needs to be. You got to think of social responsibility not just about giving money away. It can be about treating your employees really well. The best thing, I think, the most socially responsible thing you could do is make sure your employees have a job tomorrow and treat them well, whatever that takes. Yes, if you can take time off to volunteer, or if you can donate part of your profit, that's fantastic, but I don't think you need to feel the great pressure of that right when you're starting up, if you don't have time.
Bobbi Rebell:
I feel like there is pressure for people to say, "I'm giving this percentage to charity." In fact, by employing people, you are helping.
JJ Ramberg:
Yeah, and look, when you're starting out, you know this, you don't necessarily have money to spare to give away. That money needs to go back into building your business.
Bobbi Rebell:
Solvency is important.
JJ Ramberg:
You have to think about what makes sense for your company at this particular time. Look, it's changeable. As you grow, things can change. I think treating people well and keeping your doors open, you can think of that as socially responsible.
Bobbi Rebell:
Give me a money tip, something that you and your family do that our listeners can implement right now.
JJ Ramberg:
I have recently started categorizing all of what I spend, which I think is so fun. I know some people think that is so horrifying.
Bobbi Rebell:
That's fun? That's not fun.
JJ Ramberg:
I know. It's so funny. To most people, that sounds awful. To me, I take such great pleasure in seeing exactly where my money is going. My money tip, if it at all sounds fun to you, go ahead and do it also. There are all kinds of systems online.
Bobbi Rebell:
Are you using an app?
JJ Ramberg:
I use a proprietary one, but there are lots of them out there that will help you do this.
Bobbi Rebell:
Thank you, JJ.
JJ Ramberg:
Good to talk to you, Bobbi.
Bobbi Rebell:
Here is my take on what JJ had to say. It has a lot to do with her refreshing and realistic on business and being socially responsible while you build a business. Financial grownup tip number one, as JJ says so well, when starting a venture don't get caught up in making sure that you give, for example, a certain percentage of profits to charity, or give employees days off to volunteer. If it works for your business plan, that's great. The truth is if your business provides a service that is helpful to your clients, providing value for them and also can provide a solid and stable job for your employees to support their families, that is good too. A solvent, profitable business should be your priority.
Bobbi Rebell:
Financial grownup tip number two. From the consumer perspective, for things that you are already buying, see if there's a way that you can buy things that you're already buying, and have a percentage of what you are already paying go to a cause that you care about. For example, you can start with Goodshop's new Gumdrop extension. You could also, for example, shop with retailers that donate a percentage to charity like Amazon Smile, which has the same products as Amazon, but donates half of one percent of your purchase to the charity of your choice.
Bobbi Rebell:
Also, keep an eye out for themed promotions at places you already shop where they will give a certain percentage to charity for that time period. Separately, you can go directly to charities and even schools and ask if they have any partnerships with retailers. Very often you can put a code in and, for example, enter through a website portal with retailers. Then that organization will get a cut of what you spend. I also like to shop at school auctions where I can buy things that I probably would have bought anyway, and you can support the school or the cause. The website I use for that is called biddingforgood. You can bid on items for any school or organization there. You don't have to be affiliated with that organization or school. I've bought everything from kids' classes to theater tickets, even a yoga mat, all through bidding for good often at lower than retail prices, in fact. Even though you're bidding, it's not always a higher price. Sometimes you actually get a good deal for yourself. Of course, the money goes to the school or the organization, so it's all good.
Bobbi Rebell:
Thank you so much for listening to this episode of the Financial Grownup podcast. If you like the show and want to hear more, please help support us by subscribing and then rating or reviewing on iTunes or Apple Podcast. That is the way more people can hear about us. Also, please share on social media or just tell a friend. I hope you enjoyed hearing JJ's story and advice and that we all got one step closer to being financial grownups. Financial Grownup with Bobbi Rebell is edited and produced by Steve Stuart and is BRK Media Production.
Farnoosh Torabi was underpaid and overworked as a young journalist. But a key piece of information put her on the road- albeit a rocky road- to doubling her pay.
In Farnoosh’s story you will learn:
-What to ask your HR department to find out if you are underpaid
-Strategies to use if your pay is at the low end of the salary range for your job
-When to know it is time to look for a job outside your current company
-How to handle the big question “How much do you want to make” during job interviews
-How to turn an employers promise of a future raise, into an immediate salary bump
In Farnoosh’s lesson you will learn:
-How to most effectively advocate for yourself
-How Farnoosh was able to persevere even when she faced pushback about her compensation
-The importance of getting the information in advance of negotiations
In Farnoosh’s money tip you will learn:
-Why she advocates checking your numbers every day
-What weight and wealth management have in common
-How she uses Mint
-How checking your finances can help catch financial fraud or hackers
In My Take you will learn:
-My mothers suprising negotiating technique
-How I got a salary above my ‘reach’ range by using it
-My dad’s philosophy on how companies show appreciation
-How to handle being offered a higher title and more responsibility- without a pay bump
Episode Links:
Find out more about Farnoosh’s course “Personal Finance for Grads” on Investopedia.com by going to academy.investopedia.com and look for Personal Finance for Grads.
Be sure to use the code FARNOOSH20 to get 20% off the $99 course lifetime access.
Farnoosh also mentions Mint, where you can also check out her columns.
You can learn more about Farnoosh Torabi on her website http://farnoosh.tv/
Follower her on social media:
Twitter: @FARNOOSH
Instagram @farnooshtorabi
Facebook: www.facebook.com/FarnooshTorabi
Listen to the So Money podcast on itunes
And check out my episode from when How to be a Financial Grownup came out!
Farnoosh Torabi was underpaid and overworked as a young journalist. But a key piece of information put her on the road- albeit a rocky road- to doubling her pay. Listen to this Financial Grownup podcast to learn how she doubled her salary and how you can too. #Salary #SalaryIncrease
Transcription
Farnoosh Torabi:
I was in my mid 20s, wanting to get a raise at my job, kept asking over and over again to no avail. Finally, my father clued me in to this term that was really ground-breaking for me.
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:
So, what were the magic words my guest's father told her about? And no, they were not, "I quit," or anything like that. But I do promise you, friends, you will learn a lot about the harsh reality of trying to pry more money out of a current employer, emphasis on current.
Bobbi Rebell:
You're also going to learn a whole lot about the power of information. My guest is Farnoosh Torabi. She is a big name in the personal finance space. You probably know her as the host of the So Money podcast. She's also the author of a growing list of best-selling books, which began with the, You're So Money; Live Rich Even when You're Not, published in 2008, and her most recent, When She Makes More. She also has a red hot course on Investopedia on personal finance. What else? I'm going to ask her about it. Here is Farnoosh Torabi.
Bobbi Rebell:
Farnoosh Torabi, you are a financial grownup, and I am so excited to be chatting with you today.
Farnoosh Torabi:
I'm so glad that I earned this designation. Financial grownup, how great. Thank you for having me.
Bobbi Rebell:
I'm so happy you're here, and you're definitely a grownup, and by the way, I have you to thank for inspiring me to do this podcast. It was something that I was thinking about for a while, and we had a little conversation in the green room at the 92nd Street Y before a conference, and that was kind of the final push that I needed. So, I am forever grateful, so thank you.
Farnoosh Torabi:
Oh my gosh. Well, I'm glad to help. I'm happy to serve. I'm in. So wonderful that you're doing this. It makes a hundred thousand percent sense.
Bobbi Rebell:
Women podcasting about personal finance is a category that we want to grow, so we're all in this together. Speaking of growing, you are moving into courses. You have a really cool new thing happening with one of my favorite websites, Investopedia.
Farnoosh Torabi:
Investopedia.com basically brought my dreams to life. I've always wanted to do a money course, but as you know, as people listening know, a course is a big project. It's not just the teaching of the course, but it's the marketing, the infrastructure, the sales, the production, and frankly, all that just made me get dizzy and not feel like at all interested. I just wanted to show up and teach.
Bobbi Rebell:
But this is where you say, "It was worth it, though."
Farnoosh Torabi:
It was worth it. Well, they came to me and they're like, "We'll do all the back end stuff if you can just show up and teach," and that was music to my ears. So, together in collaboration, we created a nine-module money course, catered to graduates, people who are just recently out of college, young adults. They're getting their first paycheck, their first real paycheck, and they want to learn how to maximize it, how to make the most of that weekly/monthly paycheck.
Farnoosh Torabi:
So, you're going to learn about how to budget, how to save, how to invest properly, how to earn more, as salaries have been stagnant for a long time, so really excited about that.
Farnoosh Torabi:
If you go to academy.investopedia.com, and you look for Personal Finance for Grads, that's the new name of the course. We ended up switching it, because we wanted it to be really specific about who we were targeting. Personal Finance for Grads. And if you use the code, FARNOOSH20, you'll get 20% off. It's just 99 bucks, but you'll get another 20 bucks off with that code, FARNOOSH20.
Bobbi Rebell:
And also, maybe a good graduation present. Just a couple of months from now, people will be graduating. It's a really good thing, even if you're not a graduate, to think about gifting to someone.
Farnoosh Torabi:
Great idea. Yeah, thank you. Thank you for that plug. It's lifetime access, so whether you buy it now, or in six months, or today, you'll have it forever.
Bobbi Rebell:
Good stuff, and by the way, when I was studying for my CFP, Investopedia was my go-to destination when you're looking for some arcane financial term, they have it all there, so that's my nod to Investopedia.
Farnoosh Torabi:
Well, they're the largest resource for financial information, so makes sense that you were able to bank on their definitions.
Bobbi Rebell:
Right, no one would have some of these terms, but they have everything there, so they're a good place to check out, and get your course.
Bobbi Rebell:
But I also want to talk to you about the money story that you have brought today, because it has something that I would love to do, which is that it doubled your salary. So, tell me. How exactly did you double your salary?
Farnoosh Torabi:
I was in my mid 20s, wanting to get a raise at my job, kept asking, over and over again, to no avail. Finally, my father clued me in to this term that was really ground-breaking for me. It was what's known as your salary range or your salary band. It's information that human resources typically has at the ready to give you. They're not going to voluntarily give this to you, but it is your right to know.
Farnoosh Torabi:
So, I went to HR, because what this salary band essentially tells you, is what your employer has budgeted for your job, for your post. At the time, I was a producer. I discovered through HR that the salary band for my job at this particular new station, was anywhere from $44,000 up to $85,000/$90,000.
Bobbi Rebell:
That's a big range.
Farnoosh Torabi:
That's a big range, and guess what? I was on the very low end of that range, despite having been there going on three years, doing multiple jobs that were above and beyond my original job requirements-
Bobbi Rebell:
And they didn't just come to you and say, "You're working really hard. Let's just give you [crosstalk 00:06:09]-
Farnoosh Torabi:
No.
Bobbi Rebell:
No, really? That's shocking.
Farnoosh Torabi:
When did that ever happen? So, I was taking all the right steps, but this was gold, you know, learning actually what my company at the most, valued me at, was gold. Now, I will say that I used that in my next meeting with my boss, "Since I have some updates, I discovered that I actually can make up to, you know, $90,000 in this role. I've been here for three years. I'm still at the very low end. I'm like in the fifth percentile of this range, so I'm not saying I want to make $90,000, but I do think we could bump me up like five or ten K." And it was, "Okay, maybe when we review budgets." It wasn't like a done deal.
Farnoosh Torabi:
So, then I started to really see the handwriting on the wall, started to look outside for a new job. When I got interviews, I never forgot that salary range, and when I finally got close to a deal at this new employer, and they were talking money, they said, "How much do you want to make?" And I remembered that range, because that range was not ... Look, remember that's not just a range probably for your employer, but it's industry norms.
Bobbi Rebell:
Right, companies know what's going on in their sector.
Farnoosh Torabi:
They know what's going on, and this new job that I was interviewing for, was a step up for me, and it was a more senior position, so that range was probably not even valid, but I used it as a baseline. So I said, "I would like to make $100,000." They said, "Well, we don't have a hundred, but we can give you 80."
Bobbi Rebell:
That sounds good.
Farnoosh Torabi:
I said, "Okay, well, you know what? I really, really want a hundred," and they said, "Well, why don't we start at 80, and then in six months we'll review where you're at, and we'll discuss maybe giving you a hundred at that point."
Farnoosh Torabi:
And I'm like, "Okay. This is the time to take all the money you can." When you're in negotiations. In six months, they're not even going to remember what they said about some meeting they wanted to have with you.
Farnoosh Torabi:
So, I said, "Look, can I have 90, and then I won't bother you in six months."
Bobbi Rebell:
I like that.
Farnoosh Torabi:
And they said, "Sure," nice and clean. And you know, so effectively, I doubled my salary. I went from 45 to 90, and I owe credit to knowing that salary range.
Bobbi Rebell:
So, Farnoosh, what is the lesson from your Financial Grownup money story?
Farnoosh Torabi:
The lesson is, you have to be your biggest advocate. You have to continually be curious about what it is you're after. So, I was not going to take "No," for an answer from my boss, and I just kept exploring, and digging, and questioning, "How can I make more money?"
Farnoosh Torabi:
And I talked to my family about it. It ended up my dad was the one who told me about this salary band thing, which I had no idea about. If I hadn't told him about it, I probably wouldn't have walked into HR, and asked them for the number, so don't give up. You know, a "No," is one step closer to a "Yes." As long as you stay curious, and determined.
Bobbi Rebell:
So, let me ask you. Do you have a day-to-day money tip, an everyday thing that you can recommend to people that they can implement right away?
Farnoosh Torabi:
Implement right away. I would say check your numbers every day. Look, I don't do this all the time, but I do step on a scale quite frequently, because I want to make sure that, you know, if I had a pretty crazy weekend of eating, I can check in with myself. I keep myself accountable. Like I'm, "Okay, I've gained a few pounds. I need to be mindful of what I'm putting in my mouth this week."
Farnoosh Torabi:
Your money's the same thing. Like you might have a week or a month where you overspend. It's important to know where you're at at all times, so that you can adjust. You can continually readjust and adjust and fine-tune your finances, but you're never going to be able to do that unless you have the knowledge of where you are financially.
Farnoosh Torabi:
So, on my phone, I am constantly checking my bank balance, my credit card balance. I check my Mint app, just to see am I over-spending, under-spending? I set budget limits for myself. This maybe isn't an every-hour or an every-day thing, but it certainly should be a regular, maybe twice to five times a week kind of thing.
Bobbi Rebell:
Well, it's also smart to check in because there's so much hacking and fraud, that this way you spot it.
Farnoosh Torabi:
Absolutely, right. For that reason alone, you should be checking your bank account.
Bobbi Rebell:
Awesome. Thank you for all the amazing advice, and thank you for being part of this new program. We really appreciate it.
Farnoosh Torabi:
My pleasure. Thank you.
Bobbi Rebell:
Here's my take, guys. Part of being a financial grownup is taking advice from your parents. I'm not always the best negotiator. I'm going to toss this one to my parents, and share some advice that they have given me over the years.
Bobbi Rebell:
Financial Grownup negotiating strategy number one, courtesy of Adele Rebell, the Just Keep Your Mouth Shut technique, meaning let the other person say the first number.
Bobbi Rebell:
True story, I once had a number in mind as a reach for a job. I didn't think I was going to get anywhere near that kind of money, but I kept my mouth shut, let them make the first move, and the offer came in $10,000 higher than that reach number.
Bobbi Rebell:
Then, I sat there. I was calm, cool, collected, pretended it wasn't enough money, asked for more, and you know what? I got another $5,000.
Bobbi Rebell:
Bonus tip, by the way, from my mother, the Keep Your Mouth Shut strategy can also work for losing weight. I'm a CFP, not a nutritionist, but guys, it does work, because of course you eat less food.
Bobbi Rebell:
Okay, back to our focus on money. Financial Grownup strategy number two, comes from my father, Arthur Rebell. Companies show love and appreciation with money. Companies may try to distract you with a fancy new title and lots of new responsibilities, but then they don't give you a meaningful raise.
Bobbi Rebell:
Imagine if you tried to pay your Visa bill by saying, "Well, my budget's tight, but I'm going to call you my Senior Global Credit Card. Yeah, not so much. Take the higher title, and say "Yes," to moving up in terms of responsibilities. That's all good, but just know, it is not the same as a raise. Companies show love through compensation, aka money. So try to keep the focus on the money.
Bobbi Rebell:
Thank you all for the amazing feedback that we have already been getting on the program. It is truly appreciated. Please subscribe, download, share, review, rate, all that good stuff. We need it. We are a brand new podcast. All of your support means the world to us.
Bobbi Rebell:
I hope everyone enjoyed the show, 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.
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
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