Imagine growing up in a neighborhood where everyone is on government assistance, pulling yourself up on your feet enough to attend one of the most prestigious colleges in the USA… only to find yourself deep in credit card debt and struggling. That’s a small sliver of Yanely Espinal’s story (you may know her as Miss Be Helpful on YouTube). She joins us today to help you figure out how to pay down debt, fix your credit, but most of all, to just get started.
In our headline segment, Wells Fargo (that bad-boy bank out west) is in the news again, and NOT for a good reason. We’ll share why AND what you should consider doing with your money if you’re with one of the big banks. We’ll talk credit unions, online banks, and the world of FinTech to help you make a swap to more friendly shores.
Of course, we’ll also throw out the Haven Lifeline to a Stacker in need AND challenge you with Doug’s Miss Helpful trivia. Remember the Miss Helpful books? They made TONS of Benjamins for the author AND helped people to be a little kinder to each other.
Deeper dives with curated links, topics, and discussions are in our newsletter, The 201, available at StackingBenjamins.com/201.
- Former Wells Fargo executive Tolstedt to pay $3 million SEC penalty (InvestmentNews)
Big thanks to Yanely Espinal for joining us today. To learn more about Yanely, visit MissBeHelpful. Grab yourself a copy of the book Mind Your Money: Insightful Stories and Strategies to Help You Reach Your #MoneyGoals.
- In the book originally published in 1981, the character Little Miss Helpful, who is positive and loves to help out, was what color?
Need life insurance? You could be insured in 20 minutes or less and build your family’s safety net for the future. Use StackingBenjamins.com/HavenLife to calculate how much you need and apply.
- Jane has a question about the most efficient way to name beneficiaries on her three investment accounts.
Want more than just the show notes? How about our newsletter with STACKS of related, deeper links?
- Check out The 201, our email that comes with every Monday and Wednesday episode, PLUS a list of more than 19 of the top money lessons Joe’s learned over his own life about money. From credit to cash reserves, and insurances to investing, we’ll tackle all of these. Head to StackingBenjamins.com/the201 to sign up (it’s free and we will never give away your email to others).
Written by: Kevin Bailey
Miss our last show? Listen here: From Covert Ops to Unleashing the Mind: Itamar Marani Shares Mindset Hacks.
So you’ll pick me up tonight at 7 45? Oh, well, no. I got a few things to, to take care of first, but what, why don’t we make it quarter to eight? Stop it. Okay. 7 45
Live from Joe’s mom’s basement. It’s the Stacking Benjamin Show.
I’m Joe’s mom’s neighbor, Doug and get ready to mind your money here today to share her story and strategies to reach your money goals without being bored, senseless. Let’s welcome miss. Be helpful, Elli Espanol in our headlines. Wells Fargo. Welcome back to the News again, y’all’s son of a Gun. We’ll cover the latest from The Bad Boy Bank of the West.
Plus we’ll throw out the Haven Lifeline to Lucky stacker Jane, who wants some advice on the most tax efficient way to leave retirement accounts to loved one. And then I’ll share some Tish trivia. And now two guys who know something about being animated, Joe and Oh
yes. One take. They call him one Take Doug, everybody in Hollywood and in mom’s Spaceman, everybody, welcome to Wednesday. I am Joe’s. C i Ever Joe Money on Twitter. And we are animated and not like marionettes animated in a way that we can’t get enough talking about money. Mr. Og, across the table, no strings attached to him.
I’m nobody’s puppet. He is. I’m a puppet master. Well maybe come on. You want like a Megadeath song about that reel? I don’t know. I or something listening to Megadeath when I was like 12. Ouch. So who am I kidding? I wasn’t even listening to, I was listening to Barry Man Low when I was 12. I’m like, he is fantastic.
Do we need to go there again? Because we had a whole time period where you guys gave me a lot of grief for listening to Barry and now you’re admitting it. You made young Girls Cry and Young Boys for that matter. Me. Is he the one that made Doves Cry or you don’t want Doves to Cry? Oh, doves is Prince Wayne.
Doves Cry. Different guy. Whole different guy. Yes. Uh, welcome to the Oldies Music for the Win podcast. We got a great show though. Yli Espanol does everything. Uh, uh, marketplace by American Public Media has a new outlet and uh, she is the host. She also, it does stuff for next Gen Finance. She is going to come in and give her best tips as a Brooklyn Born Ball of Energy.
She’s bringing that energy to today’s podcast, but before that, we’ve got, maybe can we have sponsors? Can we have sponsors right now? Joe? Hold on. Wait, wait. Please wait more. Please, sir. I thoroughly enjoyed that. Sir, please, can we have some more, please? Might have gone a bridge too far with that, uh, that one Doug, but hey, Elli Espanol is here, but first.
It’s time for the headline. Hello Darlings. And now it’s time for your favorite part of the show. Our Stacking Benjamins headlines In our headline today, it comes to us from investment news. Hey, remember this little bank out West og? Well, they’re in nearly every neighborhood in America called Wells Fargo.
Are you familiar with them? Mm-hmm. I haven’t heard of them. Oh, they had this cute little thing they were doing. Let me explain it to you. See, you went in and you opened up a bank account and they opened up like seven or 10. Oh, it like buy one, get one. Yeah, it was, it was, it was. It was buy one get nine. It an oer.
Yes, it was a BOGO offer and it was all because they were giving incentives to the banks based on the amount of new account openings. Well, they end up paying bankers. Incentive to the bankers. Incentive To the bankers, yes. Not the people actually use the banks that, some people say matter, but apparently Wells Fargo didn’t think was important in this deal.
The s e c levied on. Wells Fargo, 3 billion in penalties in 2020. Well, more has just come out of that. Here’s the headline. Former Wells Fargo executive toted to pay 3 million s e c penalty pocket change. Wells Fargo and companies former head of retail banking carry Toted agreed to pay 3 million to settle securities and exchange commission case over misleading investors about a key metric.
The lender used to gauge success. The settlement subject to court approval follows toad’s agreement. Marched to plead guilty to obstructing a probe at the bank’s practice of opening millions of accounts for customers without their authorization Toted faces as long as 16 months in prison. Under her plea agreement, according to a statement from the Department of Justice at the time, her sentencing is set for September.
Uh, she not only had to pay 3 million. This is personal by the way, og. This is over and above the 3 billion that Wells Fargo had to pay. She also, uh, had to pay back one and a half million dollars of what they call ill-gotten gains, and she also had to pay some penalties on top of that interest of about $450,000 on that money.
Uh, the s e C. Back when the banking crisis happened. You remember there was a lot of finger pointing. And yet, and we have had people on the show talk about this, only one person went to jail and that’s because they admitted wrongdoing. Everybody else said, Hey, wasn’t me. And nothing bad happened. Wells Fargo not just being taken here for a lot of money, but now going after an executive personally, that’s, I, I think that’s a pretty big deal.
Turns out you’re not supposed to lie, cheat or steal. Isn’t that weird? And they’re actually gonna go after you s e c getting some teeth now. Is that the deal? On the heels of the, uh, Elizabeth, what’s her name? Elizabeth Holmes. The Theranos. Elizabeth Holmes. Yeah. Person, uh, going to jail. They’re feeling all chuff.
Yeah. They can get anybody now. They’re on a roll. Yeah. Although, to be fair, she was convicted, what, like a year and a half ago, but was given like a year and a half of like forever just get your stuff together. She got pregnant twice, you know, to make this actionable. We’ve said before on this show that in your list of to-dos the big banks might not be your best friend og.
There might be some better options. So I’ve got a piece here from Investopedia, credit unions and banks and how to choose, which might be better for you. And actually when it comes to banks, which ones might be better for you. Uh, the key takeaways here, credit unions tend to have lower fees, better interest rates on savings accounts and loans while banks, mobile apps and online technology tend to be more advanced.
I think it really depends their own gm, what you’re looking for. But I still, you know, the Wells Fargos of the world, the, you know, the Banks of America. I think you can largely now with online banking look beyond that. Does anybody use ATMs that much anymore? It’s funny, I was just having this conversation with my mom cuz she banks with a, uh, small.
Local credit union and that credit union merged with another credit union. And so, you know, it was meant to be a pretty simple, smooth transition. And of course, you know, it was everything. But, and I said, well, I don’t understand why you’re doing, you know, what, what the heck are you doing on a, a bank for anyway?
I mean, just, just find the one that’s gonna pay you the best with the least amount of issues, right? We use Ally, not a pitch for Ally, but it’s a simple process. The app is fine, the interest rates are good, the tech is easy. If you do have to call somebody, it’s quick. And you know, they do everything I wanna do.
If I need to move money, wire money, whatever. It’s easy. All on, all on your app. And she said, well, how do you get money though? And I said, what, what do you mean? She’s like, well, if you need money, how do you get money? I said for what purpose? Like what, what would one need this money thing for? Like, I mean, seriously to your point, like, I mean I’ve got cash in the wallet.
You’ve got cash in your wallet a little bit at home, you know, tips or something like that. You know, a little something, but you know, the days of needing to go to the bank to cash your check to go pay the water bill, you know, you just do it online now, you know? So do you, when you get your, if it’s an all online, cuz I do not have an all online bank, but if you, if you do do one of those institutions, you get an ATM card and you go to any atm, you might pay fees, they might waive your fees, but you can go just, you just go to any atm.
That’s how you get cash. I think it’s pretty uniform now that most online banks waive all ATM fees. Yep. And yeah, you can go to any ATM to get that. And that’s what I was, mm-hmm. That’s what I was getting at with mom. I was like, well, you just go to an ATM machine. I don’t see any ally ATMs laying around.
It’s like, like, no, but you know what? I’m guessing she must drive like into town to go to the ATM for the one ATM at the one credit union that she uses. I mean, like even if you need local support when it comes to credit unions, people forget. There’s this co-op share branch network that I use. This piece talks about 5,600 branches, more than 5,400 surcharge free ATMs across the United States og.
So if, if you truly want a credit union atm, they have the ability to do that if they’re a member of the co-op share branch program. . So, so I think you’ve, you’ve got it there. I think the difference between the big bank, which used to have all the modern conveniences and the little guy, not so big a difference anymore. No, no, you’re right. Absolutely. Yeah. Not so much. And you know what’s funny is Ally and the online banks, I think that they’re making headway all the time.
In fact, there’s a, there’s a talk I’ve giving at a credit union conference coming up, and I’ve been studying this issue about the difference between banks and credit unions. And what’s also interesting is how much FinTech has brought a lot of these online banks, og to your point, like Ally to the forefront with all the stuff, just not the local presence.
Which to your point, we don’t, we, we may not really need. I’ll link to this Investopedia piece, credit unions and banks, and the key differences between them on our show notes page at stacky Benjamins dot com. We also, by the way, have a newsletter that’ll dive more into where to find the best features in banking and in credit unions at uh, the 2 0 1 stack Benjamins dot com slash 2 0 1 for our newsletter, which comes out every Tuesday and Thursday.
Coming up next, Elli Espanol is known online as Ms. B. Helpful. She’s a millennial financial educator. Started her career as a teacher. You can tell she’s a teacher. She definitely is the heart of a teacher. Now serves as Director of Education, outreach, NextGen Personal Finance. As I mentioned, American Public Media’s Marketplace, which I’m sure a lot of you are familiar with.
She now is the host of a new program that they have out. Uh, she is coming up next with some phenomenal tips, not just on banking, but on credit and more. But before that, Doug, you may have some trivia that might be miss, be helpful, related. I don’t know. I’m just gonna start talking and we’ll see where it ends.
Uh, it might be, might be, I don’t know. Hey, there’s stackers. I’m Joe’s mom’s neighbor, Doug, and I’m known for my helpfulness around here. For example, I’d like to help out all the neighbors by letting ’em know when their yard work isn’t up to snuff. Someone’s gotta let ’em know when their edging is getting sloppy.
I don’t care if you hurt your back or you got a newborn. Excuses. Standards have to be met. Speaking of being helpful, the first Little Miss Children’s book series was published in 1981 as an addition to the Mr. Men series by author Roger Hargraves, where each character had a single dominant personality trait, both of which were later turned into a cartoon.
After Hargrave’s death, the rights to all 92, Mr. Man and Little Miss Characters were sold for over 34 million. My question is, in the book originally published in 1981, the character Little Miss Helpful, who is positive and loves to help out, probably inspired by me, was what color? I’ll make that simple.
What color was little mis helpful in the book? I’ll be back right after I counsel Bob on keeping his lawnmower blade sharp.
Hey there, stackers. I’m fertilizer spreader and Northern California sent Amelia, expert Joe’s mom’s neighbor, Doug. And I think I’m changing hearts and minds on lawn standards in the neighborhood. I don’t want to have to mow another man’s lawn, but I’ll do it. I will. And now I’ll also be helpful and share today’s trivia answer.
What color was mis helpful? Well, she was Pink. Joe’s Mom’s pink with Pride because it’s time to introduce the woman who will help you learn how to mind your money and reach your financial goals. Elli Espanol. Espanol is here with us. It’s about so excited. It’s about time. It is about about time. Let’s start here.
You got in trouble. I gotta make sure I pronounce this right. You got in trouble for talking about a fefe when you were lucky about a fefe. Tell us why you got in trouble. Talking about the fefe? Oh man. First of all, I didn’t know what the heck that word. I didn’t know what my mom was saying, but my mom oftentimes would say to us, like I, and she would be like frantic, getting her keys, getting her purse, getting everything.
And I never knew what, what these things were. She was going to these. And I think, I think I must have been in college when it, like it finally clicked to me that she was saying face-to-face. And the reason why is because I saw it in writing on paper. There was a paper that came in the mail that said, your face-to-face is scheduled on this date.
And I was like, oh. I was like, oh my gosh. She’s been trying to say face to face, but my mom doesn’t speak any English. She’s immigrant from Dominican Republic. Her and my dad. My dad speaks a little bit more English because he drove a taxi cab in New York for decades. He learned, he picked up some English in the taxi, but my mom, no.
So that was her telling me she had to go to a welfare appointment in order to renew her food stamps and to keep getting benefits from the government. And um, yeah, I got in trouble for yelling that out because my sister, who was like a teenager at the time, I was probably like nine years old. She heard me in the yard doing my little tours.
I was sweeping and stuff, and I, and I yelled out to her like, I didn’t know where mom went because she was asking me Where, where’s mom? And so eventually I was sweeping and it just like it hit me. Oh, that’s right. She didn’t go to a doctor’s appointment. She said that she was going to your thing. So I yelled it out really loud.
Mom had a welfare appointment and my sister was so upset, like she was so mad at me that when I came back in the house, she like knocked me on the top of my head. Like she was knocking on the door and she was like, why would you tell everybody on the block that we’re on welfare? Like, you’re telling everybody our business.
Um, and I was nine years old, so I just didn’t get it. I’m like, why is she so pissed? Like, what is the, what is she so upset about? And plus everybody on the block was also on welfare. So I, so I don’t understand why she was so mad. We were all in the struggle, you know? So yeah, that was definitely the, the, the story that I wanted to open with because it just sets the tone for the fact that from day one, from a young age, I was kind of taught not to talk about money.
Right. I was very much. Yeah. Taught that and conditioned that way. I grew up in a completely different household, but my parents, whenever, whenever they were talking about money we had to, my sister, my brother and I, we had to walk outta the room. We were not allowed in the room. Wow. When, when money talks happen, you just, you just didn’t talk about it.
And the sad thing is, even though you’re out there, spreading the good word, we’re trying our best, you know, to keep up with you. We, we still, it’s so frustrating how few people listen. Yeah. Yeah, it’s true. I mean, it’s just not, it’s just not sexy. Like it’s not hot, it’s not trendy. You know, it’s funny. I’ll tell you this.
I recently hired a virtual assistant to help start helping with social media, especially with the book promotion. It’s a, it’s a lot of work. Yeah. And so she was going through all of my social media posts for my Instagram account and she was like, all right, let’s see which of your Instagram posts has been the most popular.
And I was like, I think it’s probably gonna be something about credit cards, because a lot of people, you know, found me on YouTube through posting a lot about my credit journey and paying off credit card debt. I was wrong. The number one most watch post on my Instagram has over half a million views. And it is a real, a video that I screen grabbed off of Twitter, of Cardi B ranting about inflation being so high that her groceries were going up and up and tripled up.
Her places were tripled up at the grocery store and she was ranting about it. So I took that Twitter video, I screen grabbed it, and I cut out all the curse words and I reposted it on my feed as like the clean version, right. Why did that have half a million views? Because it’s, it’s entertaining. It’s entertaining.
There you go. Right. So when we’re talking about like budgeting and being smart with your money and making sadly financial choices, that’s not sexy, that’s not funny, that’s not entertaining, that’s not cool. That’s not trendy, that’s not it. That’s not hot. So it, it’s really tricky for us as educators because we have to find ways to trick people into thinking that we’re entertaining them, but we’re also, you know, adding nuggets of financial education in there for them too.
Well that’s when, when you were growing up, your parents worked very hard. You talked about your dad driving a taxi. I didn’t know that. I read that he worked in an Italian restaurant. Your mom had so much trouble finding childcare for kids. It was much better for her to take that full-time job at home.
Yes. So your family struggling. You felt bad asking for money. So you decided that there was an easier way to get stuff. Tell me about the easy, about the easier way to get stuff. When I was in elementary school, I think I was about like 11 or maybe, yeah, 11 or 12 years old. So probably middle school I would go after school with my friends and just start like, cuz the bodegas in New York City, there’s bodegas, right?
Like corner stores where after school it gets wild. The bodegas packed with like, 55 kids from after school coming in with their little, you know, change to buy quarter waters and little bags of chips and stuff. So the bodega’s packed. It’s very easy to steal something if you’re in a crowded bgo with so many kids and you, you know, so I noticed like just how easy it would be to take ice cream sandwiches from the fridge or to put potato chips in my coat or my book that no one would notice.
It was too crowded. It was too busy. And so I, I started doing that and I think at first psychologically, like when I reflect on it, I think it was because I wanted to impress, like my friends, I wanted to be cool and I wanted to be popular. And so if I was the kid that was doing that, like that little rebel, I would have a, a way to be cool because I, there was no other way I could be cool.
I had no, no name brand clothes, no name brand sneakers. I didn’t have name brand book bag. I never had the cool clothes, shoes when, you know, Christmas break. Everybody would come back with like this and that and I’d be like, no, I got some hand downs from my sisters. Like I got, I got nothing. I got nothing.
And, and so I think that was kinda like mentally, like I think that was my way of trying to find a way to still be cool even though social status didn’t buy me. Yeah. That, that cool badge. Um, and so I started stealing and I got caught stealing with my sister in, um, Dwayne Reid, which is like one of the Yeah.
CVS, Walgreens type of, uh, pharmacies in New York City. And I slipped up some lip gloss right up my sleeve. I thought I was gonna be so slick. And of course, right on the way out, the security guard stopped us and showed footage of me putting it right up my sleeve, and I was so embarrassed. And I think it was just like a learning moment for me of a, a check-in like that I had to have with myself because I saw my mom and dad’s faces.
I saw how, how so like disappointed and sad they were when they found out that I did that. And it just made me think like they busted their butts to come to a whole different country to start a whole new life. So that. Me their child could have an opportunity and access that they never got, and so that you could have the access to steal some lipstick, literally.
I was like, is that that what they all for this person? So I check in with myself and I realized all. No, this is not the kind of person I want. I wanna be, I wanna make them proud. I want them to know that all their sacrifices and all their hard work was worth it because they raised a quality human being with, you know, values and, and strong character traits.
Not, you know, malicious intent. So I stopped stealing and I never stole again. I put it in my book because even though it’s a little embarrassing, I worked with a lot of teenagers and a lot of students in the education work that I do, and a lot of times they get caught in, you know, all kinds of negative situations, whether it’s stealing, whether it’s detention, whether it’s fighting.
And I really want younger people to read my book so that they know you can still be successful. You can still have a, a great career. You can still be the type of person who inspires others, who speaks at event, who has a YouTube platform, who, whatever you wanna pursue, you can still do it. Even if you’ve got caught stealing or got detention or got suspended.
Those mistakes don’t make you who you are. If anything, they should make you stronger, make you more reflective. But I think that we oftentimes, we assume that young people stealing, teenagers stealing, oh, they just have malicious intent. They’re just. They’re no good and really, like you never know what they’re going through or why they’re doing that.
Um, and poverty oftentimes has a lot to do with it. So I wanted to include that. Oh, absolutely. I mean, when you talk about that and how we don’t know what’s going on with people, there’s a report that I absolutely love from a group called Nonfiction Research that talks about all of these hidden statistics around America.
And I think it’s 5% of us, like one in 20 of us, have stolen food outta the refrigerator at work. Like if you’ve, you’ve worked in schools, you know, there’s always that person, you think they’re a jerk who’s stealing your jello out of your lunch. They’re not doing it though you, Nellie, because of the fact that they’re, they’re being a jerk.
They’re starving. They have no money. Their debt is so bad that they’re stealing. I mean, it even talks about the number of people that said that they’ve dumpster dove before. You know? Yes, it’s. I think those are the stories of struggle that need to be told more because A, the people who are doing that, the one out of 20 don’t want to tell anyone that, right?
First of all, it’s, it’s shameful. It makes you feel shame. It’s embarrassing. So I do think that it’s something we just need to make it more normalized, more acceptable to talk about like all of the struggle and what it looks like and not only the parts that are convenient to package and offer to the press.
So like, I really wanted to make sure I told that story. It was, it was, I, I kind of double thought about like, I really second guessed myself, like, should I share it? Should I, I was hesitant. No, but then I made, I made the decision. I gotta put it in. I think it’s the right decision because I think people think that people like you are people that were just born with this gene that other people don’t have.
And I think the more we dispel that myth, the better. So I think that’s, uh, that’s like a Detroit home run at Yankee Stadium is exactly what that story was. Just go, sorry. Oh, did I say that out loud? I’m sorry. So you gotta get it in so you work your ass off. To go to Brown University. Yeah. It’s a very prestigious school.
When you’re there though, you and I have something else in common. You, you could approach. I saw at the student union, there was this cool thing where they were, I don’t remember if it was a Frisbee or beach towel or whatever. You had somebody with a clipboard come up to you and they were offering you something.
Awesome. Can you tell us that story? Yeah. So I remember I was walking across campus cause I, I would work in between my classes. I was like, I was always working, I was a little worker B. And so I’m walking across campus to go from class to work. And this woman comes out to me with a clipboard and she’s like, Hey, like if you fill out this application for a credit card, student credit card, you can get a free T-shirt.
Awesome. And I was like, what a free t-shirt. Sign me up. I work free t-shirt. You know, you, you, you’re in college especially. You’re so broke. You’re just thinking free, free, free. You know, free is where I wanna be. You got free pizza. I’m there. You got free t-shirt. Sign me up. You know. So I went over, and then the thing too is the way she explained it to me was that if I was struggling to pay for things like my textbooks or any school supplies that I needed, or just errands that I needed to run, pick up some detergent that I could put it on a credit card and pay it off little by little.
And that this student credit card was, you know, very popular and that a lot of students have signed up today and should, you know, you could see the application stack so, I was like, okay, you know, sounds like a great deal to me. I, I buy it today and then pay it off little by little. Why, who wouldn’t wanna do that?
Duh, duh. So I filled out the clipboard, the, the, you know, application on the clipboard. And like two weeks later I had a, you know, plastic card with my name money in my campus mailbox. And how cool was that by the way? Oh, I don’t, oh man, I don’t, I don’t know about for you. I took mine, I took a bunch of, a bunch of other students to this exclusive restaurant called Ruby Tuesday.
It was amazing. Oh yeah. And at at the, they had a salad bar and everything. It was incredible. But then at the end of dinner I told everybody, I’m like, I got this. This is on me. Oh yeah, because I had no idea. You did something similar. You ended up running up. How much credit card debt did you run up? Oh my gosh.
I had, I had over 20,000 by the time I was outta college. So I graduated in the, in the spring of 2011. It was wild because I didn’t realize how quickly it was all adding up, cuz I never looked at my credit card bills. I never read like the line items to see like the interest fees that kept on I, I never looked at it.
I would just open it up, look at the first page of the P D F, which was your minimum balance due by the due date. That’s the only thing I cared about. Minimum balance, $35 due date, June 1st. Okay, great. I’m gonna send $35 on June 1st. Check that off my list and go on my next homework assignment or paper that I have to write.
Like I was very much just like to-do list kind of kid. And I feel like if I had understood ev all of the implications of using our credit card and not paying it off in full every month, or making an attempt to try to get as close to paying it in full, I, I think I would’ve made a, a valiant effort. But I didn’t know, I had no idea.
They didn’t explain to me the interest rate or how the interest accrue. She just told me, you buy one thing with the card and you paid off little by little, it helps you build credit and all this kind of stuff. So, you know, the funny thing is too, I think back to when I opened that mailbox and I pulled out that plastic card.
And if there’s one word I could tell you that I like to describe the feeling, it’s weird, but the word is pride. Yes. Because I felt like now I don’t have to go ask mommy and Poppy for money and bother them and put more of a burden on them and stress them out. I have a card with my name on me and I’m handling it myself.
So for some reason I felt like a real adult. Like I got this credit card with my name on it. Now I can handle my, my, my money and my finances and not worry, not make them worry about more. Stress them out. Mind you, I had no idea that I was gonna simultaneously run up a bunch of debt and, and mess up my credit score.
You dive into this later in your book. What are the couple things about credit that people should know that we don’t know? So I try to handle credit a little differently because I feel like every time I learned about credit, it’s so confusing about what exactly goes into the credit score, what do you do versus don’t do.
Some people literally say, do this with your credit card, and then another TikTok video will say, don’t do this with your credit card. And I’m like, do I do it or do I not do it? I mean, the information online is conflicting and it’s so confusing. Yeah. So I try to think of like an analogy that would have helped me when I was in school, because that was when I really needed this information.
Me too. And you know, and I, and so for me, I started thinking like, okay, why was I so successful in school? Why was I, why did I thrive academically? Like, what was it that made me so nerdy and, and like school so much? And I really think it’s because when you start a class, the professor literally hand you a roadmap to get an A plus.
It’s called the syllabus. They just put it right in front of you and you see the books that you’re gonna need to buy for this class. All the times that you meet when the, you know, the papers, the due date, the midterm, the final. And you can see the breakdown of your grade. So your syllabus literally tells you, you know, 30% of your grade is attendance.
So you show up to class and you get those 30 points. You know, 15% of your grade is participation in class. You better raise your hand and speak up and make sure the teacher knows your name. You know, 10% of your grade might be this project or this homework assignment or quizzes. So, you know, this is what I gotta do and these are the things that matter the most for my a plus.
And these are the things that, it’s okay if I skip a quiz or something cuz it’s only 10%. I don’t care. Right. That is why I was so successful in school. It’s not because I’m some genius or because I have some, you know, gene that somebody else doesn’t have it. I was given a roadmap. If I had been given a syllabus for my credit, I would’ve followed it and I would’ve literally been thriving with a excellent credit score because I, I thrive off of being given a very clear plan of attack and what steps I need to do and by when.
So I call it in my book a credit syllabus, which literally is like when a professor hands, you got a syllabus. You see 35% of your credit score is all based on your payment history. So you better pay your bills on time. 30% credit utilization never spent more than 10 to 30% of your credit card limit. You know, I broke it down like that because I think if a high school or a college student is reading this book that they’re gonna be like, oh, Exactly.
And instead of just being confused and, and like, it’s so it can get so overly complicated for no reason. It can, and that is the sad thing. And by the way, you, not only degree from a prestigious university, I believe you also have a master’s degree. I do. You have all this work that you’ve done and, and, and you have what, what I’m gonna call a rant.
And I love this rant about, you know, going into the syllabus thing, you’re a very smart person and you got into credit card debt. Why don’t we have this in schools? Talk to me about personal finance in schools because, well, you just had an insta, we’re doing this on Instagram for people listening later.
You just had an Instagram post about this. How, yay. There’s a couple more schools finally that are, that are offering personal finance in school. Why is it taking so long for us to put this into schools? You know, so the way that the laws work in our country, laws can be either at the federal level, which means that one federal law can affect all Americans in all 50 states.
Other laws would be local laws, which are state by state level laws. Education as an issue in our country is a local issue, which means it’s left to the states to determine what the education system must teach and what it must include and what is not allowed state by state. By state. So you could live in New York City like I do and be learning certain class, picking certain classes and learning certain things.
And then your friend who lives in Massachusetts is not learning that. Yeah. Is learning something completely different? Because the state determines what you learn when you learn it, how many credits you need, which classes you have to take, the curriculum, all of that. It’s at a local level. If it were a federal issue, it would be so easy for the president to just wave a magic wand and say, Federally.
Now, the education, uh, depart, the Federal Department of Education says every state must teach this. But they cannot do that because education is local. So what that means is we have to literally go state by state by state, and convince every single house committee on Education and Senate Committee on Education.
So two education committees on both sides of the chamber. You have to convince two groups of people to all vote yes, or majority vote yes on a requirement, and then when you get one, you gotta do that again and again, 50 times. So I started working in personal finance education in 2018 and the beginning of 2018, there were only five states that had a full semester requirement as part of graduation requirements for graduation for high school level specifically.
And at the end of 2018, there were eight states. Then it slowly started going up. Now, today, as we’re speaking on June 1st, 2020 3, 21 states, 20, technically 20 states have officially signed a law, the 21st State, which is Connecticut. The, the bill was passed, but in order for it to officially become the law, the governor has to sign it with Wet Inc.
That hasn’t happened in Connecticut yet. Technically, the governor could veto it. I don’t think that’s gonna happen, but, so once Connecticut’s governor signs that bill, it’s officially now the 21st law in the country. So that means we still have a little bit of a ways to go to get half of the country, the 25 states, and then we got another 25 to go to get the fifties.
Well, and I’m, and I’m only laughing because we can’t even agree on, uh, which historical facts are facts. So, you know, that is so true. And here’s the thing about financial education, which is why I love my job. Honestly, I couldn’t tell. Do you love your job? I can talk about this for hours, but, but here’s the thing about it.
I love it so much because when you think about some of the hot button issues about, you know, what is American history, how should that be taught? Or, you know, should civil specific education be taught? Or, you know, there there’s so many debates, right? In terms of personal finance education, I will admit to you, it is not difficult to get both sides to agree whether you are a Democrat or a Republican or independent.
We all agree that financial literacy education is critical and is a priority of the school system. Yeah. Where, where we can’t always agree is who is gonna teach it? When does it get taught? So who’s gonna teach it? Is it gonna be the math teacher? Is it gonna be the economics teachers, the business teachers, the CTE teachers, the social studies teachers?
Who’s gonna teach it? Second of all, when do the students take it? Is it gonna be freshman year, sophomore year, junior year, senior year? What if a student needs, uh, AP credits? Will we have a personal finance class as an AP level so the kids can get college credit? Okay. How are the teachers who have never learned personal finance themselves, how are they going to get upskilled so that they can teach this class if they don’t know personal finance themselves?
So per professional development training for the teachers? No. When is this gonna happen? Can you just say like, starting tomorrow? Teachers have to teach it, you know, so these are the the, the details, right? All the little things. All of these, yeah. Yeah. This is what I would say called like the fine print, the terms and conditions in the law, which is why you need everybody to come together, create a coalition, and agree on when it gets taught, who’s gonna teach it, what are the standards they’re gonna teach.
All of these details get decided together. But now when you have a coalition of the politicians, the lawmakers, the teachers, the parents, the students, the teachers union, the bankers league, the credit union folks, the small business leadership, you, when you have so many people, the Superintendent’s association, Now it kind of becomes like, like too many chefs in the kitchen type of thing.
Right. You know what I mean? So, right. Imagine even when all the Republicans, all the Democrats, all the independents all agree. Yeah. Right. Yes. We need to get this financial literacy bill. Oh, but we all have to go into this coalition room in this meeting and agree on those details. Oh, but I don’t agree with that detail.
Oh, but I think it should be freshman year. No, I think it should be senior year. It should be 2024. No, it should be 2026. And then we’re just in the weeds. We’re totally in the weeds. Literally in the weeds for so long that guess what Sessions have deadlines. So you don’t meet the session deadline. The bill doesn’t get passed.
It doesn’t become a law this year. Oh, you gotta start all over again next year. So that’s what happens. The bills tend to die of silent death. Every year, which is why it’s taking so long for us to get every state on board. I got two more areas I wanna cover. We, we talked earlier about your debt. How, how high did your debt actually get before you started your turnaround plan?
So it was just under 21,000 and the breakdown was about 16,000. Just under 16,000 was just straight up pure credit card debt. And that was from four different credit cards that I had. Three were maxed out completely and one was like almost maxed out, but not completely maxed out. The rest of the debt was a student loan that I took out.
Even though my scholarship covered my tuition, my room and board, and my three meals a day, it didn’t cover anything outside of that. So when I wanted to study abroad, I mean, I had been studying French since like middle school, and I was like, why am I, I studied French for two decades in my life to not go to French and actually see French, like it doesn’t make sense.
So I really wanted to study abroad before I graduated. And the study abroad program was way too much money. I did find a few grants that covered some of it, but the other 7,000 I had to kind of, you know, take out a student loan to pay for that. I ended up borrowing directly from Brown University rather than borrowing a federal student loan or growing the private route.
Thank goodness. Because you know, those private student loan rates end up getting really high. Yes. Yeah. So I was, fortunately I got a very low interest rate student loan at about $7,000 and I paid that off little by little. Um, and honestly that was paid off before I even realized how bad my credit card debt had gotten.
So, you know, total a little bit, uh, over 20 k and honestly I can’t even complain about the student loan cuz I luck out with lower rates. Well, that’s what I was gonna ask first as a follow up, is, would you do anything differently about your education or financing your education? I got admit, I did not know how else I was supposed to come up with money to buy a laptop and pay for my textbooks.
Me neither. I, I mean, how, where is this money coming from? Yeah. You know, And the confusing thing for me was I never got a class about paying for college. And that’s why I love like championing personal finance. Personal finance. It includes budgeting, banking, investing, saving taxes, insurance. It includes managing credit and your credit score.
It includes paying for college careers. So when you have a comprehensive course, a full semester, which is 18 weeks, which is what we championed, cuz a lot of states will say, we have financial literacy already. And when you look at the law, it says nine weeks of instruction must be taught. That’s not comprehensive.
You need a minimum of 18 weeks to cover all those topics. Right? Yeah. So if I had gotten that and I had been taught about paying for college strategically, what I would change is I would actually borrow student loans instead of using my credit cards, even though there’s a student loan debt crisis and people go, oh, oh, against student loans.
Student loans are low interest rate debt. These are much more favorable terms versus a credit card, which were, for me, were over 24, 20 5% interest. Yeah. So, which is wild. Yeah. So for you to be paying 20 something percent interest, like as a student, as a broke college kid, and recently I actually saw a chart that showed all different credit card rates, small businesses, individuals, uh, college students.
The highest interest rate on any of those types of credit cards, it’s not for business owners, it’s not for individuals with low credit scores. It’s college students, student credit cards have the highest rates. So I just would not do that again. I would get a student loan. I would max myself at, you know, the maximum federal allowed amount each year, and I would just use that to live little by little and then pay it back aggressively when I graduated and got my job.
Man, at the very least, if you’re a parent and you’re hanging out with us and you can impart before your kid goes to college, some of this wisdom. That you and I didn’t have. Like if anybody, anybody in our stacker community can just help their, because you know, you talked in your book about how, what happened to you and happened to me, the person with the clipboard for you, the table in the student union for me, that can’t happen anymore.
But what you just said is that they’re still predatory. They’re still predatory because the highest interest rates are still on those campuses for those very same people. A hundred percent. And actually, I was recently on a college campus in Maine. I went to go speak to a group of students and I was walking around the campus and I saw a cafe set up, but it was branded by a bank.
So I was like, oh, this is interesting. They’re not actually pushing the credit cards in exchange for little Exactly. So it’s so funny to me how they still find ways to get, you know, their branding in front of these young students, uh, even if they’re not pushing credit cards onto them. All right.
Everybody’s yelling at their device right now. Ask her how she got outta credit card debt. How did you get, get rid of the debt? And if you were gonna do it again today, would you have done it a little differently? The first thing I would do differently is I prioritize paying off my student loan debt.
Over my credit card debt. Why? Because I had no idea what the interest rates were. I had no idea what, how paying off debt strategically even looked or sounded. So I tackled my lower amount, which was my student loans, and I was taking that very seriously while maintaining my minimum balance on my credit card.
But that literally makes no sense because my credit cards were charging me nearly three to four times as much in interest. So I, I always think about paying off debt as like you’re in a race. And you have to, if you wanna win this race, you have to find out who is your highest competition. Who is the fastest runner in this race?
That’s the person you’re racing against. That’s the person you gotta be when you have different um, um, debts, different debt accounts. You need to find out which one is running the fastest, which one is growing the fastest, and that’s who you are up against to beat first. Set all your payments on, minimum on all your accounts, and attack with everything you have.
Fastest running, fastest growing debt, which is the highest interest rate you have.
You gotta hit the first. If you really want a quick win, just pay one really low one and then immediately reorder them by highest interest rates and lowest its interest rate. Because at the end of the day, you’re saving yourself potentially thousands of dollars depending on how much debt you have. So it really makes a big difference to focus on the fastest growing or the fastest running debt in your group.
Which I didn’t do that, but I wish I could have. Um, if I could go back in time, that’s one thing that I would change for sure. But how did I pay off my debt? I mean, it was 18 months of intense, frugal living. Um, I don’t know if I would necessarily put myself through that again, but I’m glad I did it. Yeah, because I, I had a lot of, um, perks.
Like I was living with my mom in the basement for the first year that I was working like we today. So I didn’t to pay rent. Yes. Which I didn’t have to pay rent. So I was using that money, you know. So I, I kind of used a little bit of the advantages that I have. I’m like, why would I leave mom and puppy’s house when they co rice some beans every day so I can pack my leftovers for lunch and I can, um, you know, get to work pretty quickly.
I don’t have to pay rent. I just picked up one bill in the house and paid that bill to help them out. And so that helped me the first year. Um, and then I moved in with a friend and, uh, coworker. And during that time I was super frugal. I was packing my lunch every day. I was really like on my zero base budget, like every dollar being tracked.
And also picking up side hustles. So I was babysitting on Thursday nights, Friday nights, Saturday, Sunday afternoon. I was tutoring right after school ended. I would stay and the parents would pay me a nice amount because you’re not just getting a high school kid to tutor your kid. You’re getting, uh, you know, a teacher with a master’s degree in education.
So I would, I would charge a premium for tutoring as well as a charge a premium for a babysitting, because I would also help them with their homework while I was babysitting them. So you get a two for one, you know, and so I was able to make extra money on top of my teacher’s salary that I was throwing at the debt.
At that time, I learned about this like whole debt repayment plan and setting everything up this way from a Suzy Orman book called Women and Money. Yeah. First of all, it’s so strange to me that when we think about personal finance books, most of them are written by men. And the one that I picked up happened to be Women and Money by Suzy Orman of a book written by a woman, , so I, I felt like her book spoke to me because I had lived in a household where there were a little bit of differences between the genders and the expectations on us. She was, it’s, it’s funny because, you know, as I was reading in the early and mid nineties trying to get my.
Financial house turned around from my awful financial predicament that I was in. I’m reading all this stuff and you know what’s funny, reading Susie Orman versus everybody else. I think that’s part of why she cut through so quickly was she spoke differently. Like I, oh yeah. The big thing she spoke to that really spoke to me was about having respect for a dollar and taking the money in your wallet and if you had dollar bills in your wallet, rearranging them and, and just realizing how hard it is to get this money.
And that was kinda like my Vicki Robin moment, right? My, yes. Oh yeah. Hey. Oh, this is, it took me a ton of time and effort to get this money. Why am I just blowing it, you know, just yellow and all the money, all the money away. I want to ask you one, one more thing you do talk about though, about how important mindset is.
And it’s funny because one of the most hilarious stories, I think in the entire book is your name for, uh, Nobel Prize winning economist Richard Taylor. Uncle Richie. Uncle Richie. How the hell do you call Uncle Richie? And what did Uncle Richie teach you about money? You know? Okay. I found out about Richard Taylor on a PBS News Hour special that I ended up watching at a conference I was at.
And it was about how the research that they had conducted proved that you, you don’t think about money logically you think you do. We all think we’re so logical with money, but we’re not. And so they had a group of Cameroonian students at the park in Chicago and they walked up to them with the camera crew and they were like, alright, if you paid 40 bucks for your, uh, contra ticket, And you’re outside in the rain, the concert’s going on, but you’re being stoked.
I mean, you’re like, it’s awful. Would you stay at the concert or would you go? And they were all like, no, no, we’re out. We’re leaving. That sounds horrible. And then we’re like, then Richard’s Uncle Richie looked at them and said, what if you paid $400 for the concert ticket and it was pouring rain and you were standing there and it was awful?
And they were like, uh, we would stay. We would definitely stay because uh, nah, we gotta get $400 worth. We gotta get our money’s worth. And he explained to them that there is absolutely no difference in those two scenarios. You’ve paid the money, you are not getting it back. It’s a sunk cost. So in your mind, there’s this sunk cost fallacy where you think that by staying, you are getting your money’s worth the money.
It doesn’t matter how much you pay for the concert ticket. You can leave and make money with this time or you can stand there and enjoy the concert. It’s it, the money’s gone. Right? It’s a sun cost. So at this point you should decide, do you wanna stand here in the rain for the next hour or can you go do something else in an hour that you would rather be doing?
I realize that I do that a lot. I think to myself, I gotta get my money’s worth. Yeah. You know, I feel like I have to go to this event cause I paid for a ticket or I feel like I have to do this thing cuz I put money and that’s not logical. We. Think it’s logical, but it’s a fallacy. So I just became obsessed with this concept that he was sharing in the video and I went and bought his book called Misbehaving, which sounds a lot like mis be helpful.
So you know, I, I liked it a lot. I was like, oh, I like that. I like that name for the book. Maybe he is your uncle. He is your spiritual uncle then. He is. He really is. So his book Misbehaving It broke down all of these different behavioral biases and mental biases that we go through, especially when we, you think about your cognitive function when it comes to money.
And so I just felt like I was back in college nerding out reading these books, but it was specifically for money, which is something that I never got in a college class. So I just loved it and I just learned about all these cognitive biases and then I started looking into ways that you could fight back against them and try not to fall prey to all of these mental biases.
You talk about banks versus credit unions. You go into setting up a budget. Of course you talk about mindset. You talk not just about Richard Thaler, but about a few of your different uncles. You know what my favorite part of your debt story actually was? Was just you getting out there, which is how really I think you’re here with us today and we’re so out there about it and, and that, that pressure on you I think was, was just, it was so kick ass that thank you that, um, well, and I think more of us need to do that.
It was such a brave thing to do. Cuz like you said, we don’t talk about this. And to put yourself out there. But I think that also is a great way to be successful. Tell a friend, maybe you don’t want to do an Instagram thing or be on YouTube like you were a podcast. Like I do. Just tell a friend, say, Hey, help me with this thing.
Oh, yeah, yeah. No, you, if you don’t talk about something, how do you expect to get better to grow, to learn about that thing? I mean, anything that you’re interested in. Right. I think I learned this from, um, Oh, what is, there’s a motivational speaker who says this, where they’re in a conference and they have someone raise their hand and they’re like, what is it a problem that you’re having?
They’re like, you know, uh, I have my son. He really wants to play chess. And the chess camp over the summer is like $3,000. And there’s just no way. And so I just feel really bad. Like I’m heartbroken. I have to tell my son, no, I can’t put you in chess camp this summer because a mommy can’t afford it. And then they put it out to the whole group in the conference.
Anybody here have a way, an idea, a solution for them? Somebody in the back raises their hand and says, I’m a chess master. I’m a master chess player. I would love to spend my summer volunteering to help yourself. So if you don’t speak up, put your issues, your problems, your curiosities, what you wanna explore and navigate further, you don’t put that out there.
Who’s gonna hear it? Nobody, nobody’s gonna hear it. Only the little voice in your head. So I, I felt like I had to just start talking about it so I could find other people that were just as nerdy about money as me, and I could kind of create this community and have this tribe. And thank goodness for social media, because let me tell you, my family was, They were just so over it.
I had talked about rap IRAs and paying off your credit cards aggressively and they were like, shut up. We don’t, they were like, we don’t care. Like, I literally remember my brother telling me, somebody joker. Somebody joker, yes, precisely. He was like, we don’t care about the vesting schedule in your 401k and whether you get your Mac, we don’t care.
I was say, but it’s really important and if you dunno, you gotta check your 401K papers. You want me to look at it for you? He’s like, I want you to shut up. Oh, that’s so awesome. Oh, you gotta find your people. You gotta go out there and you know, find your people. If it’s not your people that is your family and your friends, that’s fine.
They’re out there somewhere, but you gotta put yourself out there to find them. I’ve never had a time in my life when I thought, thank God I waited a year before I got real about that. Never, boom. Never the book. Mind your money. It’s about the time she wrote the damn book. Yes. Mind Your Money. Insightful stories and Strategies to help you reach your Money goals.
How cool is this, huh? Yes, it is awesome. Oh, I can’t believe it. Everywhere. Yes. Available everywhere You can get it on mind Your money book.com. Yeah. And you, you even say in the book, you have some extras there too, for people. Yes, absolutely. There’s a free guide, which has a bunch of good stuff. You know, one of the things I’ll tell you, when I started becoming a higher income earner, right, I was like, oh my gosh, there’s so many things that you can do when it comes to strategies for taxes and saving money.
And, and I just like went down that rabbit hole because I don’t already know anybody else who’s as much of a high income earner. My family. Like people just didn’t make that amount of money. And even if they did, they never understood these types of strategies. So I went down the rabbit hole and then I found it so confusing to understand things like a backdoor Roth I strategy once the worst learned, worst name, worst name.
Once. Once I finally understood the backdoor Roth strategy and I tried to do it. Oh, you can’t cause the pro rat rule. I’m like, what the hell is the pro rat rule? Fuck that way. So then I’m like going and navigating the rabbit hole to try to find this pro rat rule thing and try to understand that, which is complex.
And so I felt like I finally found resources that were like simple and helped me understand these things. And so I put them all into a free guide because I mean, I didn’t have no space in the book to talk about those kinds of things. They’re so like specifically for people in a certain situation, but I added them to the free guide.
We’ll link to it on our Sonos pages, Stacking Benjamins dot com, you know. Great. It’s about time we finally got together. I know. So, so happy that you could help our stacker community. Thank you so much. Thank you. This is awesome. Hey, Nick Loper here from The Side Hustle Show. When I’m not helping people earn money outside of their day job, I’m Stacking Benjamins.
Oh, big thanks again to Yali for hanging out with us. Hey, let’s throw out David Lifeline tackle some of life’s most important questions. Our friends at Haven Life Insurance Agency, og, they put what you value first. Me again. Uh, still on golf, I guess. Uh, still golf. More golf. Uh, can I say golf again? Yes. I’m playing in a golf tournament this weekend.
Oh. And I’m playing with my brother that’s turnover a new leaf. Awful. And is the worst golfer in the entire tournament by a factor of two. He is twice as bad statistically as the next nearest competitor. So are you, are you doing this just to get the handicap advantage? Yes. But it’s not gonna work.
Totally. It’s not gonna work out for me because he is incapable of shooting anything under one 10. This is steak brother, right? Yeah. Yeah. So I, I’m gonna predict right now that if you went and looked at his shorts, both pockets will have holes in them about this diameter of a golf ball. So when he loses his ball ob, he can drop one through the shorts and say, found it.
I see. No, no. We just have to keep him off the sauce cuz he likes to pregame. He’s, he’s a bit younger than og and so he’s, he’s still got, he’s like, it’s eight 30. When do we start the Fireball shots? This is golf tournament. Like we’re, we’re trying to win the thing. We’re trying to win the thing. Buddy thinks he’s John Daley.
He is. He looks like John Daley. He’s got all of the physical characteristics of John Daley and the mannerisms, except for the actual competitive golf swing, sway, anx, except the golf swing. Yeah. He hits the ball just not squarely on the club face. This is the same brother by the way, that when I went to Alabama with him to play after playing for a day and he was, you know, a day and a half and he was kicking my butt and I was like, what is going on here?
He’s hitting the ball dead, straight down the fairway. He was the guy that I figured out put on his golf clubs because it deadens the ball. So there’s no spin. You didn’t see the knuckle ball effect as the ball was leading the t No, I mean, it wasn’t until I grabbed his club and there’s this big smear or something.
I go, what the heck? He’s like, oh yeah, something’s on there. I gotta wiped it off. And I’m like, but it’s really on there. Like, what is, it is like chapstick or something. He’s like, uh, and then he has this big. had eating grin on his face and I’d been, had it works. I was, I was out a lot. I tried it once cuz I read about it like a summer or two ago, maybe two summers ago, and I couldn’t believe it worked.
So I tried it and it does work, but I could see the ball like knuckling, you know, it was like wiggling and, and it’ll cost you like 20 yards on your drive. And I don’t have 20 yards to give on my drive. So don’t you need to swing your, to get your swing speed up a little bit. We’ll work on that this summer.
We just didn’t turn into a clinic for Doug. This is Haven Lifeline. Oh, is it? Let’s bring it back. I thought this was Golf Digest podcast time. I thought that’s what it was. Let’s bring it back. Joe, you’ve failed. In your role, it says that it’s your loved ones in your time. That should be, which I’m gonna spend a lot of time with my loved ones this week.
Keeping ’em off the sauce, keeping ’em off the sauce until at least the, the, the front nine’s over. It’s why they may buy quality turb, life ature. It’s actually simple. You go to Stacking Benjamins dot com slash haven life now to get a free quote. I love what they’re doing at Haven Life because as you crack open your life insurance online application, you can guzzle, you can guzzle their affordable prices.
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You might have a problem if you got half a million dollars off steak brother. Um, there you go. That would be payback for all the Yeah. Strife and turmoil over my life. What would you do that half a million dollars? Uh, well there’s an answer there. That’s the basis of many, many jokes, but, uh, many movies, I would invest the money prudently.
Uh, obviously. Oh, yeah, duh. That’s, oh, is that what we do here? That’s what I would do. That we talk about. Sure. Head to Stacking Benjamins dot com slash HavenLife, Stacking Benjamins dot com slash HavenLife and get your life insurance taken care of, uh, especially if you’re going to play golf with og. Hey, uh, let’s, uh, throw out the Haven Life line to Jane.
Hey Jane. Hello. You people, I’ll preface this by saying I’m not planning on dying anytime soon, but if I were to die, my estate would go basically 50 50 between my parents and my sister, and I’m wondering if maybe I should leave them in a manner that is more tax efficient for them. It’s basically a 401k, a Roth IRA in a taxable account.
But I’m wondering if maybe I should leave my 401K to my sister and then put my oth the other two accounts to my parents because my parents are already required to take minimum distributions. Whereas my sister, since she’s older, would still be able to take the 401K out based on her lifetime. Let me know what you think.
Jane, thank you so much for that question. I’ve never thought about that actually. About, well, I think I have, that’s o, that’s OG right there, Jane. That’s his thought about that, by the way, I think to answer the question, what you do, the first thing you do is you put on a smoking jacket. You sit in front of a fireplace and you make a video of right after you die.
Right? Talking about where the money’s hidden and then you send them on a, on like a treasure hunt. Like a treasure hunt, Joe, one edit to that. It might be a good idea to do it right before you die. Yes. It’s very, very odd. If you did it after you died, they, there’d be a lot of impressive investigation.
There would be, Dateline would be involved. My, your veracity might come into question. Right. Where did the money go from the Swiss bank account? We don’t know cuz he’s dead. Jane Jane’s hit the Jane’s at the Pearl Gates going, don’t forgot. So, oh crap, I got that, that timeline wrong. Yeah, go back. No, but just before you do.
And I, I think that’s the way to leave it to them. When you said, how do I leave it to them? Sounds like a much better idea. Yes. Like a bunch of limericks spread around the countryside. So why do you not care about the tax efficiency of the investments? If sister’s gonna use the money a different way than mom and dad do I think there could be something to that.
Yes. Except she said one thing in there that’s completely changed in the last, uh, tax law update, which was she said, and then my sister can take it out over her life expectancy. And that’s not true anymore. So now inherited IRA accounts have to be completely withdrawn. By the end of the 10th year, you can defer it for up to 10 years, but then, you know, you got 10 years of additional growth on top of it in order to distribute.
It gives you some flexibility in there, but it’s certainly not distributing over your beneficiaries lifetime like it used to be. That used to be what we call the stretch ira, where, you know, you left the IRA to your kid and then they got to take little teeny tiny bits out of it for a really long time.
Now it doesn’t matter 10 years unless you’re a spouse. Um, and there’s some, some question on this also. The IRS hasn’t answered this, this exactly yet as to whether or not they require some distribution every year, uh, as part of those initial 10, that 10 year time period. So some people argue that the, the law is written intimates that you’re supposed to take a little bit every year with the final distribution being in the 10th year, not wait 10 years and take the total amount.
So, you know, there’ll probably be some clarity on that as well as you’re thinking about it. There’s certainly fine to, you know, go, well, hey, I’ll just give the money this way or this way. But number one is make sure that you solve your own problem first. Right? You know, as you’re thinking about your retirement planning, as you’re thinking about your asset allocation and asset location for where you wanna put your money for retirement, make sure you’re solving you first.
And then if you want to kind of be nice and, and work on it from a, uh, uh, from a beneficiary standpoint, you know, that’s a, that’s a nice secondary thing to do. Those accounts too are gonna probably, if they’re based on when you’re going to use that money, are going to grow at different speeds. And so also being okay with the fact that instead of the 50 50 you have now, if you do that, that also may change the percentage.
And if you’re okay with that, I think then that’s another factor. And why not give them the ability to be the most flexible that they need to be? And let’s say that you have all of your accounts, you know, Roth, a traditional in a, in a brokerage account. Why not have each account split 50 50 so that the beneficiary then can decide the best way?
To use it based on their circumstances. You know that at the time, particular time period. Yeah. Which might change between now and then. Like you said, Jane, you don’t plan on dying anytime soon. So Yeah, of course. The other thing that I would add to this is don’t be afraid to add contingent beneficiaries as well.
You know, we’re seeing a lot of people who have, you know, their traditional beneficiary listed, I got mom and dad 50 50 sister, you know, or I got my, you know, mom and dad, or I got my wife, or you know, whatever. But nothing listed as a secondary beneficiary, what we would call contingent beneficiary. If that primary person is not around anymore, then what do you want to have happen?
Think about it this way. If something bad happens in your family, is the first thing you’re gonna think of is to go, something just happened to mom. You know what I should go do, change all my IRA beneficiaries? Of course not. You wanna give yourself some flexibility in there that that’s kind of already thought out in terms of next steps, should anything bad happen kind of sequentially.
So primary beneficiaries and contingent beneficiaries, please. Thanks for that question, Jane. Uh, we have not had a question like that before, which is fantastic. And how about, here’s an idea, call me crazy. We should send her a t-shirt. Oh, that’s a good idea. Maybe the Haven Lifeline Greatest Money Show on Earth shirt.
I mean, dealer’s choice, right? You can pick what she wants. Hmm. Well no, I think we’ll send her that one. No, no. Okay. I think she should probably get the ha she called into the Haven Lifeline. She gets the T-shirt or you like it or, you know, tough pettus. The Dia works. Yes, absolutely. Stacking Benjamins dot com.
They’re still soft and buttery. The T-shirt’s buttery. Yeah. Yeah. Soft and buttery as a matter of fact. Soft, yes. Use it. I use it on my toast all the time. I’m thinking, uh, if there’s butter or Vaseline on your shirt, you may have applied that a little later yourself perfectly a little differently. What might be a whole different thing.
Stacking Benjamins dot com slash voicemail is how you get to the Haven Lifeline. Uh, thanks for the call. Hey, coming up next week, on Monday, I’m going to be on Instagram live with Carl Brower from IC Cars, talking about which cars, it’s a new, a new survey they’ve had about, uh, which cars have had the most longevity drives for the longest.
So if you’re in the market for a used car, you wanna join us Monday, 5:00 PM Eastern, 2:00 PM Pacific og. I’ll tell you, the car that’s not the longest driving, it’s the one that drives through the house. It might be, don’t do that. The one that, uh, the OG children have been privileged to drive. We’ve also got to experience the impact of leaving the interior lights on.
So, you know, oh, that’s a good, that’s a good lesson too. It’s a great lesson. Yeah. Yes. So they learned how to jump a car in a manner of speaking. It would, didn’t go as smoothly as I thought because there’s some complications, but, um, just a small shock. It was Okay. So, uh, uh, are they playing like a bingo game where they’re trying to check all the boxes of all the Sure seats.
Like it doesn’t it like they’re gonna learn every single waff waffles My keys in the car. Painful way possible. Yeah. It’s like, dad, I got some bad news. Yeah. That’s coming. Yes, that’s gonna be on Instagram on Monday. Also, if you’re somebody looking for more inspiration like, uh, YALI today, well guess what?
We have put together five of our most inspiring interviews over the years. If you had to stack Benjamins dot com slash motivation, we have curated those so you don’t have to go back through the back catalog of 1600 as Doug said on Monday. We’re happy if you decide to do that. You wanna hear the whole show.
But we have curated the top five coming soon. We’re gonna do that with retirement, finding an advisor, tax planning, all the different areas. But right now we’ve got it on motivation. If you’re lacking it and you think you need more, stack, Benjamins dot com slash motivation takes you there. If you’re not here for motivation, you’re here because you’re frustrated that you’re just now making great decisions and you need to be making better ones.
Whether it’s about banking or all the topics that you know he talked about today, well, OG and his team are there for you. Stacking Benjamins dot com slash OG links you to their calendar because they are taking new clients and you can see how adding their team to your decision making process can help you make decisions.
Future you will be very proud of Stacking Benjamins dot com slash OG to get on his calendar. All right, that’s gonna do it for today. That’s the community calendar. Doug, man, you got it from here. What should we have learned today? Well, Joe, first take some advice from our guest, ya Espanol and mind the little things like budgeting and managing credit to reach your financial goals.
Second, looking for a good bank. Maybe your best bank is actually a credit union or online or, or not. One of the big players. Take it from og. Sometimes the little guys just might try a little bit harder. But the big lesson, be mindful of your money, doesn’t make it magically appear in your bank account.
Apparently there’s this thing like an earning component. Nobody told me this was a multi-step process.
Thanks to Elli for joining us today. You can find out more about her book, mind Your Money, wherever books are Sold. We’ll also include links in our show notes at Stacking Benjamins dot com. This show is The Property of SB Podcasts, llc, copyright 2023, and is created by Joe Saul-Sehy. Our producer is Karen Repine.
This show was written by Lacy Langford, who’s also the host of the Military Money Show. With help from me, Joe, and Doc G from the Earn and Invest podcast, Kevin Bailey helps us take a deeper dive into all the topics covered on each episode in our newsletter called the 2 0 1. You’ll find the four 11 on All Things Money at the 2 0 1.
Just visit Stacking Benjamins dot com slash 2 0 1. Tina eichenberg makes the video version of this show. Once we bottle up all this goodness, we ship it to our engineer, the amazing Steve Stewart. Steve helps the rest of our team sound nearly as good as I do right now. Want a chat with friends about the show later?
Mom’s friend Gertrude and Kate Youngin are our social media coordinators, and Gertrude is the room mother in our Facebook group called The Basement. So say hello when you see us posting online. To join all the basement fun with other stackers type Stacking Benjamins dot com slash basement. Not only should you not take advice from these nerds, don’t take advice from people you don’t know this.
Show us for entertainment purposes only. Before making any financial decisions, speak with a real financial advisor. I’m Joe’s mom’s neighbor, Doug, and we’ll see you next time back here at the Stacking Benjamin Show.