Money
215: Taking Control of Your Money: A Simple Starting Point
I didn’t always have a solid understanding of money. In fact, there was a time when I was living paycheck to paycheck, racking up debt, and not fully grasping why my money seemed to disappear so quickly. As a female physician, managing finances can feel overwhelming or even embarrassing when you haven’t taken control yet, but the truth is, it’s never too late to start.
The first step? Getting real about where you stand. Just like tracking your weight for fitness goals, you need to know your financial numbers. We’ll dive into how to create a spending plan (a term I prefer over budget), track your accounts, and understand your cash flow, all while keeping your life vision in mind.
Tune in today to learn how to take those essential first steps toward financial empowerment. I’ll walk you through practical tips like creating a spending plan, auditing your expenses, and understanding your investment accounts. We’ll also explore the mindset shifts that are key to reaching your financial goals, whether it’s building a side hustle or tackling estate planning. If you’re ready to start taking control of your money, this episode is for you.
Learn more about Money for Women Physicians, an exclusive money coaching program to get your money and mindset working for you.
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What You'll Learn from this Episode:
- How to take the first step in managing your money by understanding your current financial situation.
- How to create a spending plan that aligns with your life goals, rather than using a traditional budget.
- Strategies to track your accounts, cash flow, and spending habits effectively.
- How to shift your money mindset and break free from limiting financial beliefs.
- How to grow your wealth through investments without overcommitting your time.
- The importance of estate planning and financial adulting for long-term security.
Listen to the Full Episode:
Featured on the Show:
Welcome to The Wealthy Mom MD Podcast, a podcast for women physicians who want to learn how to live a wealthy life. In this podcast you will learn how to make money work for you, how you can have more of it, and learn the tools to empower you to live a life on purpose. Get ready to up-level your money and your life. I’m your host, Dr. Bonnie Koo.
Hey everyone, I hope you had a great week. By the time you’re listening to this I am super excited to present today’s topic. You know, I realized that it’s been a while since I’ve kind of gone back to the basics. So whether you’re new or not, I think this will be really helpful to kind of give you a framework for how I want you to think about and approach money.
This will be especially great for those of you who are new and have been wanting a sort of step-by-step framework of how I think about money and how I approach money.
And the first thing I want to say before I start is that it’s going to change over time. And I was actually thinking that I need to do an episode about how my money beliefs, how I approach money, how I invest has evolved since I started, which was back in, I don’t know, 2015 because that’s when I finished residency, it was around that time. And so that was like what, nine years ago?
And one thing for sure is that you will change, you will evolve, you’re going to have new experiences, you’re going to have just new insights when it comes to every area of your life. And so I just wanted to say that, and this is where I’m at in terms of my approach with money and I’m really excited to kind of go over this with you.
Okay, so basically what I want to do in this episode is basically how to get started with money as a female physician. And so one thing that I do know after having coached so many of you, speaking et cetera, is that it is so common for you, for female physicians to feel overwhelmed when it comes to money. And what I mean by that is, yes, I know it’s important. Yes, I need to do something, and I have no idea where to start. And it just seems daunting. And honestly, that’s one of the reasons it’s so easy to ignore.
And so if this is you, you’re normal. I see this all the time in my work. And I want to just start with that because I think there can be some shame or even embarrassment that you may not have fully dove into your finances, and so I just want to let you know you’re not alone. And I was there as well.
In fact, let me share a bit of my background. And so I basically, it’s not like I didn’t know anything. I was paying bills, I’m sure you were doing that too, et cetera. But I never understood why I always ran out of money. I just assumed it was because I didn’t have enough. And that is true to some degree, but the amount of money you make very rarely corresponds to your ability to spend within your means.
And so as a resident, I definitely lived paycheck to paycheck. And it was almost worse because we only got paid once a month. And so, you know, versus like getting paid every two weeks where you’ve got a little influx into it every two weeks, obviously. And so it wasn’t uncommon for me to run out or even overdraft my account a little bit. Okay? Like I was one of those people. I definitely was an overspender in certain areas of my life. And I had racked up a lot of credit card debt by the time I finished all of my training.
So that’s sort of where I was starting from. I didn’t understand how important investing was. And to me, it really was like, oh, I know I’m supposed to invest in the stock market, but that was the paradigm that I was taught in the beginning. And again, that’s one of those things that has changed over time as I’ve learned more about making your money work for you faster than the stock market.
But that’s where I started, okay? I started there. I started in terms of thinking that I had to pay off my debt as fast as I could. If you’ve been following me for a while, you know, that is sort of not what I preach now. And so we all start somewhere and that’s where I was starting from when I first started learning. Okay?
And so before I go into like the actual steps that I want you to take, I want to take a step back because, as you know, I talk a lot about mindset, how we think about money, how we’ve been conditioned. And it’s really important to examine this because if you don’t know sort of your mindset blocks around money, it’s actually going to be harder for you to get going and do the actual practical get in the weeds type of stuff.
And it’s also going to affect what you think you’re capable of in terms of how much money you want to have, what kind of life you want to live. And so knowing what your current thoughts about money, how you think about money, your current lens, it’s just important to know where you’re at.
And to give you some examples about me, I just assumed I was always going to struggle with money. And I don’t necessarily mean not having enough, because as physicians we are blessed and privileged to be making a great income, no matter what specialty you are, right? And I just assumed that I would never be able to really live the life that I want, that I was always going to be thinking I could save more or can’t retire till I’m 65 or 70.
When I did my initial calculations, that’s basically what it told me and it was quite depressing, to be honest. And so I just assumed I was always going to have that sort of, and I wasn’t even thinking it was a mindset. It just seemed like the truth to me, okay? And probably the most common thing I hear is I can never be rich, whatever that means to you, because I am a family medicine doctor, I am a pediatrician. So I want you to notice if you have some version of that belief in your brain.
And notice I said belief because it is not a fact. Okay? And so if you’re starting to argue with me in your head, it’s okay. I just want you to consider, what if it actually isn’t true? And let me remind you, you don’t want it to be true, right? Because it really limits what you can do. And so often we are actually putting ourselves in this box. I know it may not seem this way. It may seem like, no, this is really how it is. And you know, I got divorced or XYZ. And so I just want you to consider just for a few seconds that it may not actually be a truth that you need to live your life by. Okay.
Now, the way you think about money, like I said, with all things it’s going to change and evolve over time. And so I don’t want you to think that you have to figure it all out and change into this, like money is everywhere and of course I can have it all. You probably aren’t going to get there on day one. And I don’t really think that should be a goal. I want you to just make a little bit of progress, a few steps in the direction where you’re feeling a little better about money, because that’s all it takes. It’s like one step at a time.
And I always want to remind my clients and the women that I work with and that I speak to, one little step at a time. And over time that all compounds. And I am making a pun with compound interest because it is true. I have seen this all the time with the people that I work with. It may seem like, oh, I’m just taking little steps and it’s hard and I’m scared, you know, wherever they might be. And months later, a year later, you can be in a completely different place just because you had the courage and motivation to take that first step.
Now let’s move on to some practical things of how I want you to approach money. So the first step is you need to know what your numbers are. I want you to think about, you know, if you’re trying to lose weight, you need to know what you weigh. You need to get on the scale. So I want you to think about this as getting on the scale. Getting on the scale. And I will say this can be difficult for most of the clients I work with.
This is the part that people want to skip over and they just want to go right into how do I grow my money? Which is way more fun, right? Of course, like everyone wants to know how to grow their money. And that is fun, but you need to know where you’re starting from. And so what I mean by understanding your numbers is just knowing what all your accounts are, how to log into them, what the balances are.
There’s that part, just like where is my money right now? What accounts do I have? I have seen people realize that there were accounts they forgot about. Now, what I mean by that is you’re probably thinking like, how do you forget that you have money somewhere? It’s not uncommon as physicians for us to have multiple jobs, and I’m including residency as one of them. And so that’s part of understanding where it’s like, where is the money? Where are the numbers?
And then we have to think about our spending plan. Now, as you know, I talk about cash flow, spending, and budgeting. They’re all the same thing to me. I like to use the word spending plan because the words you use matter. Personally, I think the word budget generally has a negative connotation. It’s like the equivalent of a diet, and nobody likes diets and nobody likes the idea of having to cut down on something. Right?
And so what it really is, is how are you spending the money that you’re getting with every paycheck? Okay? That’s what I mean by a spending plan. And it’s also easy to go right into, okay, what’s the plan that I’m going to create? What are the line items? Like what is my rent or mortgage and et cetera, et cetera. But there’s actually a really important step before we even get into this.
And I should have mentioned it before, but let me just take a step back. You need to know your vision. You need to know what is the life that I want, because you have to understand that money is a means to an end. Your money goal has to be intimately tied to what kind of life that you want to live.
And so what that means is you need to take stock of where you are in life. And there are several areas, and if you Google life wheel, you’ll see the main areas. It’s relationships, it’s your career/business, whatever you do to generate money, it’s spiritual or religion depending on where you are with that, physical fitness, emotional fitness or health, hobbies, contribution or philanthropy.
So those are sort of like the main areas. And when I say relationships, you can subdivide it into your spouse if you have one, your children if you have one, your friendships, it could be your work relationships, right? So you can really subdivide that. And it’s like taking stock of all that and how do I actually want my life to look like?
And I often find a lot of you may not actually know because most of us haven’t asked this question. Most of us, people just haven’t asked us about this, right? It’s like, we stopped thinking about this almost as children, right? We’re always asking children like, what do you want to be when you grow up? But that’s more of a career thing, but what do you want your life to look like?
Do you like the way your life is now? Most people will know what they want to stop doing? What do you want to do less of? I find that that is often an easier question to start with. And so what would you like to do less of? You probably know what those answers are right away. And then you can kind of reverse engineer. Okay, I want to do less of this, but why?
I should probably do another episode about how to even do all this, but I think you can get that you need to know where you’re going in terms of how you want your life to look like. And you may find that you actually do have the life you look like, because that’s going to be a very different conversation about how to set up your money.
So, okay, going back into understanding your numbers, because your spending plan is going to be built to reach your money goals. And those money goals, like I said, money is a means to an end. It’s to help you to live the life that you want, or to keep living the life that you want.
And I want you to keep in mind, life is in seasons, right? If you have young children, like I do, you are in a pretty expensive phase of life, right? And so you have to realize that there are seasons of life and your spending needs will change over time. Okay? If you’re a parent, you know that most of us will want to launch our kids and for them to be financially independent and productive members of society, right?
Okay, so I’m not going to go into how to create a spending plan because I have so many episodes talking about that and we will put them in the show notes. I especially want you to listen to my recent podcast with Nick True, where we talk about spending plans and how we think about them. And we’re going to talk a lot about how important it is to know your vision and what’s important to you and what you want to spend your money on because it’s so easy to spend your money on things that actually aren’t that important to you.
And this is where really understanding your numbers in terms of how have I been spending my money? Does it align with how I want to actually live my life right now and in the future? And so this is where you’re basically auditing how you’re spending. And like I’ve said many times before, the best program, in my opinion, for spending plans is YNAB, Y-N-A-B. It stands for, you need a budget. I’ll put a link to that as well.
Once you understand your numbers, then you can create a spending plan that will help you move forward. And then we’re going to put a pin on that because you’re probably going to have to go back to your spending plan after you think about how you want to grow your money.
Okay, so remember you’re going to have a vision. It doesn’t have to be crystal clear. I don’t want you to think you have to know exactly what you want at certain ages of your life. You just want to have an idea. Obviously the more specific you can be, the better. But I just want you to start thinking about it and start writing down some notes.
And this is something that’s going to change and you’ll revisit. And so if you are married or have a partner, this is something obviously that would be a great discussion as a couple and a great idea for a couple’s retreat, right?
So then we have to do some, what I call financial adulting. And so this is where you’re going to continue to take inventory of where your money is, if you haven’t done that already. Remember, I meant logins, passwords, just knowing where everything is. And in my program, Money For Women Physicians, I provide a pretty robust spreadsheet template where you can enter all this stuff. And then it also serves as a great estate planning tool. So you want to have all that stuff organized, okay?
And then you want to know where your investment accounts are. Now, I will say pretty much everyone I work with will have some form of a retirement account. And so we want to know how much is in there, how they’re being invested, and if you want to change how they’re being invested, okay? Decide, well, how much do I actually want to put away every year?
If you’re prioritizing stock investments, notice I said if you’re prioritizing stock investments, because there are many ways to grow your money. And one of my goals is for you to know all the many ways that you can grow your money besides the stock market. There’s nothing wrong if that’s how you want to get to your money goals. It is pretty hands-off if you’re doing mutual fund investing. And it’s also a very slow way.
So if you want a faster way to grow your money or to have capital to invest, then you’re going to have to do something different, right? That just makes sense. You’re going to have to do something different. And there are many ways to do that. And if you’re a listener, you’ll know that I have episodes ranging from real estate, expert witnessing. I’ve talked about my business. I’ve had guests talking about their businesses.
So many ways to do this. I would probably say most of my clients end up doing some form of real estate. And then actually quite a few end up starting some sort of side gig or business. And this doesn’t mean that you have to do that, but being a physician there are so many ways we can help people. And so I always want to remind you how valuable your brain is, how valuable the knowledge in your head is.
And there are so many ways that you can create value and get compensated for that by using the knowledge you already have and maybe even combining it with a passion. And so I can give you so many examples, but for example, many of you know that I’ve worked with a parent coach. I actually have had her on. It’s the episode with Hope Seidel, and she’s a pediatrician. She just retired and she is now a parent coach. And so it’s such a natural thing to do as a pediatrician.
You don’t have to be a pediatrician to be a parent coach, but it’s something she noticed that she was doing a lot anyway. And if you’re a pediatrician, you definitely know you definitely are a parent coach already, by the way. And so she wanted to hone her skills and she got some additional training in how to do that.
So that’s just one example. There’s so many other examples. In fact, I just saw on my Facebook feed recently, someone that I know just through my network had been working on a patent, an invention. And she, I believe she’s a pediatrician too. And so she just noticed a problem, I think she created a nasal aspirator. And she noticed like the ones on the market, she felt that she could make a better one. And so she ended up inventing one. I just saw her post that it’s available for sale. And so like, how cool is that?
Again, I’m not saying you have to invent something, but I bet there’s a problem that you’re noticing that you probably have a solution to. And it’s possible that that solution is something people are willing to pay you for, right? And so I just want you to think about how else could you bring in money besides seeing more patients.
If you don’t want to start a business, how else could you bring in money that wouldn’t necessarily be a unit to unit increase of the time and effort you’re putting in now? Because of course, if you see more patients, you can make more money, right? But that’s not necessarily something that’s sustainable. Okay.
I do have a lot of, I was going to say patients, clients who will do that temporarily because they want to have capital to do something with. Again, it’s all about what is your goal? What are you willing to do, right? Because some of us there are certain things that you’re not willing to do. Like you might be like, I’m not willing to work an extra day a week in order to reach my money goals. And so the question for you, if that’s you, is well, how can I do it? Because it’s going to require you to do something different, okay?
Now, I know this might seem obvious, but if you are not where you’re at money goal wise, then I just want you to realize that this is going to require you to do something different, probably something new, probably something that feels scary. And that’s normal and it’s okay. And it’s all expected. And this is where knowing where your mindset is is so important, right? It always comes back to your mindset because that is what’s going to influence what you do and don’t do, and frankly, what you think you’re capable of, right?
So we were talking about investment accounts and figuring out how to grow your money, because if you don’t figure out how to grow your money that will help you reach your goals, you will be working forever. Actually I was like thinking there’s a second answer, but really there isn’t. You’ll be working forever unless you win the lottery or marry rich or get a windfall of some sort, right? Which you can’t count on, unfortunately.
So if you don’t figure out a way to make money in your sleep while you’re not actively working, then you will be working forever. And I think that just makes sense, right? And what I mean by that is making money while you sleep doesn’t just happen on day two. I wish it’s true. You’re going to have to put some initial time and effort into doing this.
And this is where I often find a lot of my clients where they have some resistance to this. But here’s the flip side, if you don’t decide to do something like this, you will be doing what you currently do forever in terms of making the amount of money that you want. So I want you to think about that for a second because people will often say, well, real estate seems like a lot of work. It is at first. And the reason why is like, you don’t know how to do it. Most likely you need to learn how to do it. Then you need to do it. And there’s a learning curve, of course there is.
But it’s not like, I’m talking about like, you’re seeing patients traditionally in terms of like fee for service, it’s not going to change unless you practice medicine differently. Right? And so you will only get paid a certain amount based on the service you’re providing. And it’s kind of linear, like direct time and effort per unit of money made. Okay? I hope that makes sense.
Whereas if you figure out a way to make money that isn’t directly tied to a unit of time and effort to make a unit of money, that’s what I want you to figure out. That’s what I help people do, right? And so initially there might be a lot of time and effort, but it’s not going to always be that amount of time and effort. It’s going to decrease over time, and yet the money will still come.
I wish I could show you a graph of what I mean, but hopefully you understand what I’m saying. And let me give you an example of that. When I am, for example, actively selling my conference and then actively planning it and delivering those programs, there is time and effort involved in that. Of course, right? But there are periods of time throughout the year where I’m actually not doing that much work, right?
Many of you know, I went to Greece for a month and before that, I think I went away for another two weeks. I moved, I’ve been spending a lot of time recently just getting my family settled, helping my son to settle into school and getting his sort of whole support team into place. He gets speech and OT and he has a reading tutor right now. And I have not been doing anywhere near the amount of work that I was doing earlier in this year when I was running my program and running the conference. And I was still making money. There was still money coming into my bank account.
You want to start to uncouple that direct relationship from your time and effort to the amount of money that comes in, because most of you right now, if you don’t work, you don’t make money. And that is just not a great place to be for the rest of your life because things will happen. You’re going to want to take a break. You might need to take a break. You might not even have a choice. And so it is worth putting in that time and effort so that in the future you don’t always have to.
So that’s the main piece. And then of course, in terms of financial adulting, having the proper insurances in place and your estate plan in place. Now, this is something that is so important. The insurances are relatively easy because I will teach you what the insurances are that you really should have. And it’s, you know, basically financial catastrophic insurance, right? Because you probably, you know, when you’re early in your wealth building, you need life insurance. Most of you know you need malpractice, you most likely have that already. The right auto insurance, umbrella, et cetera, et cetera.
So there are things that you want to consider depending on your life circumstances, et cetera, and who depends on you for money. And estate planning, especially important if you have kids. This is definitely the thing I see a lot of my clients put off because it’s like, it’s on the important but not urgent task on your list of many things to do, except you don’t know when you’re going to pass. You don’t know when you’re going to die. And obviously if you die, it’s too late.
And so I cannot underestimate how important this is, especially if you have children. And if any of you have had a parent pass, and I think that the statistic is something like more than half of Americans die without an estate plan. If you have dealt with a parent who did not have their stuff in order, you know how difficult it is for someone else to pick up the pieces.
So that’s sort of how I want you to think about the money pieces that you need in place. And then this is not a one and done thing, right? You’re going to keep learning. You’re going to keep figuring out how to grow your money because that’ll change. I guarantee you it will most likely change, because your goals will change.
As you dive into this world of growing your money, you’re going to meet people who are doing similar things or different things, you’re going to get ideas. And what you believe you’re capable of will increase and change over time, I guarantee it, which means you’ll need to make some new plans. And this is a good thing, okay.
And so I know some of you might be thinking, okay, that was a lot. Again, baby steps. What is the first thing that you can do today? I think one of the easiest things you can do to get started is to just sit down one day, like literally set a timer for one hour and make a list of your accounts and put them in a spreadsheet, right? If you already know what they are, maybe you have a password manager like I do where all the accounts are there, the logins are saved or you already have it in a spreadsheet. Fantastic.
Then it’s looking at your spending plan. Now, again, I know that’s kind of like a deep abyss of like, what does that even mean? And so I will reference some of the episodes I have of how I want you to think about your spending plan. But I also want you to think about your mindset.
Now, actually, as I’m talking about this I realized I actually have a podcast guide. I actually have curated a list of podcast episodes that loosely follow the steps I just outlined. So you definitely want to make sure and grab that. We’ll put that in the show notes, but you can also get it at wealthymommd.com/podcast.
And so I understand that learning this new language of money, actually doing all the action steps required can feel daunting and honestly feel a little lonely if you’re doing it by yourself. And so that’s one of the reasons I created Money For Women Physicians. It is my signature program where I teach you everything I just talked about on this episode from A to Z. I guide you step-by-step. You have me helping you and you’ll have a community of other female physicians who want to do the same thing.
And actually the best part of being with other female physicians is you get to learn about what their goals are. And you’re like, oh, that sounds cool. And you’re going to have new ideas just by being in this community. Okay.
This is a three month coaching program. It’s an online course with live coaching, live Q&A where I help you create your vision, figure out where your money mindset is, make a plan of how to improve it and think bigger, create your vision, look at your numbers, create your spending plan, figure out how to grow your money and what type of wealth creation vehicle makes sense for where you’re at right now. And then of course, making sure you have the proper insurances and estate planning.
There’s a lot of education because again, this is something that you were not taught in school. And so I’ve really wanted to create a one-stop shopping place where you can get all of this, what I call financial literacy, like 101 and 102 in one place so you don’t have to keep digging for things.
And so if this sounds like something you would love help with, if you would love to learn how to grow your wealth without confusion and overwhelm, if you want to gain confidence to make informed financial decisions, if you want to get clear and create a clear, actionable financial plan, again, tailored to your goals and vision, and if you want to break free from the paycheck to paycheck cycle and take control of your money, then I want to invite you to join our fall cohort 2024 of Money For Women Physicians.
We’re going to start the second week of October. To learn more and enroll, you want to go to wealthymommd.com/money. Again, that’s wealthymommd.com/money, or just go to the website, wealthymommd.com and you’ll see a link to learn more about the program. Spots are limited to make sure that you get the attention that you need. And there also is an opportunity to work more closely with me, you can think of it as the VIP package.
And so I hope you will join us. Enrollment will open on September 24th. You can join the waitlist now, and you’ll be the first person to learn about it and get access to some special bonuses that will likely sell out just from the waitlist itself.
Again, wealthymommd.com/money. I hope this episode was helpful for you. Make sure to get the podcast guide and to review the show notes. And I really, really want to encourage you to start taking steps because I promise you, if you start today, take little steps, by the end of the year you will be in a different place. You will be heading in a different direction. I promise. Okay, take care. I’ll talk to you soon.
Hey there, thanks so much for tuning in. If you loved what you heard, be sure to subscribe so you don’t miss an episode. And if you’re listening to this on Apple Podcasts, I’d love for you to leave a review. Reviews tell Apple that this podcast is, well, awesome. And it will help women find this podcast so that they too can live a wealthy life. And finally, you can learn more about me and what I do at wealthymommd.com. See you next week.
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214: The Power of Slowing Down: Lessons from a Month in Greece
Today, I want to talk to you about my experience in Greece and how it completely shifted my perspective on productivity and life. We spent a month living at a slower pace that made me rethink what it means to truly live and work. This wasn’t about packing in activities or sightseeing - it was about embracing a slower pace and seeing what life looks like when you allow yourself to just be.
Throughout our time there, I noticed how much we're conditioned to believe that busyness equals success. There were days when I’d sit in a café for hours, just letting the day unfold, and I’d catch myself feeling guilty for not “doing” more. But then it hit me - this slower pace was exactly what I needed. It made me appreciate the life I’ve built and opened my eyes to what I truly want moving forward.
This experience was a powerful reminder to step outside of my usual environment and reassess what really matters. We're already planning to do it again next summer, because sometimes it takes a break from the norm to gain clarity. If you’ve ever felt the pressure to constantly be productive, tune in this week as I share how slowing down and reevaluating can actually be the most rewarding thing you do for yourself.
Learn more about Money for Women Physicians, an exclusive money coaching program to get your money and mindset working for you.
Hey! We have just a few rooms left at our amazing group rate at the Four Seasons Oahu for the 2025 Live Wealthy Money and Wellness Conference For Women Physicians. Don't miss this chance to join us in luxurious Hawaii with incredible speakers to focus on money and living your best life. Virtual tickets are also available!
What You'll Learn from this Episode:
- How embracing a slower pace can shift your perspective on productivity and success.
- The importance of stepping out of your usual environment to gain clarity on your life’s direction.
- Why slowing down can help you appreciate what you already have.
- The benefits of letting go of the pressure to be constantly busy.
- How to create a more balanced, fulfilling life by allowing yourself time to simply be.
- Practical insights on rethinking your approach to work and life, inspired by a month-long stay in
Greece.
Listen to the Full Episode:
Featured on the Show:
Welcome to The Wealthy Mom MD Podcast, a podcast for women physicians who want to learn how to live a wealthy life. In this podcast you will learn how to make money work for you, how you can have more of it, and learn the tools to empower you to live a life on purpose. Get ready to up-level your money and your life. I’m your host, Dr. Bonnie Koo.
Hey everyone, welcome to another episode. So at the time of recording this, my son Jack has started school. School starts way earlier in Tampa. He got kind of gypped in terms of summer vacation. He basically lost about three weeks compared to if we stayed in New Jersey. Although at this age, I don’t think he really knows the difference. He’s not thinking, “I got one less month of summer vacation,” right?
But it’s definitely different here in terms of that. And besides the fact that we’re in a brand new city, brand new school, and there’s just all the things that come with that. And I will say so far, I love his school and I do feel like we picked the right place.
So what I want to talk about today was my experience in Greece. So we went to Greece for a full month. We did this program specifically for families where you get an apartment, the kids go to a school. I guess during the summer it’s more of a camp, but you can actually do this as school during the school year. So during the summer it’s not like actual school. And a coworking space for the adults.
And there were about, I think, 30 families there. And a small group of us, when I say us, of physician entrepreneurs, had actually planned this more than a year in advance. And it’s crazy, when I actually looked we booked it like May of 2023 and it felt so far away. But as you know, things always come up fast, right? Like I remember a month before I was like, holy cow, that trip is coming up. Anyway, I digress.
So we decided to do this as just a way for our families to spend time together. You know, this small group of friends we see each other a lot, but it’s not like we get to spend time with each other’s families et cetera. It’s usually in the context of going to a conference or some sort of entrepreneurial related sort of thing. And so this was the first time that many of our family members actually met each other.
Actually, I’m thinking about that. Is that true? No, I think I have met the kids and I think the kids have met each other, but in terms of spending a sustained amount of time together.
So I personally have been to Athens and Santorini before. After I took my boards, I took a post-sports trip with a group of friends, I think they were all physicians, and that was part of the trip. Now, people always ask me, should I visit Santorini? Now I really debated whether I should take my family there because it is extremely touristy and everything that you’ve read is true. It’s crowded, et cetera. And it is beautiful. It is gorgeous. And I just decided to do it.
So we went for two nights and it wasn’t crazy crowded. I heard August or the end of July and August is when it’s really crowded. I heard this year was insane actually. Now, it’s not that it wasn’t crowded when we went, but it didn’t feel overwhelming at all.
And what was different about this time is I booked a private tour for the three of us, no, four of us, my stepson was also there. And I really thought that was the way to go because when I went 10 years ago, we didn’t do that and we didn’t really get to see much of the Island. It’s kind of hard to see it all without a car there. And so I just felt like we got to see a lot, learn a bit of history.
And then we landed in, or I should say, took the ferry to Syros, S-Y-R-O-S. I had personally never heard of this Island, not that I really knew the Islands, except for Santorini and Mykonos basically, like most of us. And it is the capital of the Cyclades. I loved it. We loved it. And being there for almost four weeks, it was such an amazing experience.
Now I’ve always been into, okay, I’m probably not using the traditional definition of slow travel, but I’m not someone who jam packs or who wants to jam pack their itinerary just so I can see as much as I could. I like to, when I do these trip itineraries I like to build in obvious things, some sightseeing, et cetera, but I also love to build in lots of downtime.
Also, I always find that when you actually get to the country or the place, you’re always going to find new things or cool things that you should or want to check out that you hear about from the locals that you just, you know, it’s hard to plan for.
And so I never want a schedule that’s so jam packed that I don’t have the freedom to sort of add on some things and just kind of like, you know, where travel takes you. Sometimes you just find out things or meet people and want to do different things, right?
So I definitely have friends who love to pack it in, like always on the go, go, go. And that is definitely not me. And when you’re somewhere for a month, you have an opportunity to do that. And in fact, I really had to think about like, oh, wouldn’t it be fun to visit an island every weekend? And it sounds like a good idea, but again, I just knew that I could spend a whole month on this island and not do everything.
And so we ended up going to an island called Tinos, T-I-N-O-S for, I think it was actually only one night. And that’s mainly because it was like a 20 minute ferry ride, so it was very close.
But I want to talk a bit about what was the purpose of this? What did I learn? And I will tell you, not that I had grand plans, but I really thought I would spend a lot of time thinking about my business, working in my business and figuring out what to do with the rest of my business life. And I didn’t actually do much of that.
In fact, the last few weeks since I’ve been back, I’ve kind of been noticing a lot of the sort of negative thoughts I’ve had about how I should have spent the month in Greece. And what I’m noticing is how we are just so conditioned to be productive. And that if you’re “doing nothing,” that’s not productive. And not being productive is bad. It means you’re lazy and you should be doing something.
I think all of us can relate to this. I think it’s definitely worse for women. And it’s been really hard to drop that narrative. And the reason why I’m saying this is because this is how I spent most of my days in Greece, okay, or in Syros. I would drop Jack off at the school and then I would walk back into sort of the main town area. And that was like a 15, 10 to 15 minute walk, mostly downhill.
And then I would go to a cafe, and I had a few that I would always go to, and kind of the same group of friends or sometimes just alone. But I would go to a cafe and I would kind of just sit there for hours. And then lunch would come around and I’m like, I should get something to eat. And then sometimes I would eat, usually I would just eat with a friend who was also there.
But the cool thing is because we were there with a group of families and it was intentionally created as a community, someone actually made a comment that it was kind of like college where you just kind of run into the people you know all the time. And that’s what it was like, because that’s sort of the town center, it’s not that big, right?
And honestly, by the time I thought about doing something “productive,” it was kind of time to pick up Jack. And after a week or two of this, I was like, you know what, maybe I should just be okay with this. Like, this is the pace. Maybe this is what I was meant to do, to not actually do much and to just experience life there.
And life there is so different. We all know that Americans are, I think we’re the most workaholic people in the world. And Europeans in general are much, much better at really living life. Now, Syros is pretty hot, nowhere near as hot or humid as Tampa though. And everything would shut down like right after lunch and wouldn’t open until it cooled down significantly, and that was often six or seven.
The stores were open till midnight, even the toy stores. It was very different than what we’re used to, right? Almost reminds you of Spain. And Syros is extremely safe and there’s this main square and people would just come and hang out, mostly kids, and they would just run around.
And one thing I really liked about this trip was that Jack had a lot of freedom, a lot of independence, which I enjoyed as a child. And I feel like now in the US there’s just too much helicopter-y stuff. I’m definitely like that too, but I’ve always wondered like, why?
And obviously people say it’s because of the crime rate, et cetera, but I could have sworn I read, and I think it’s true, that things like child kidnapping et cetera is actually at an all time low. But it just feels like there’s a lot because we just have so much quicker access to the news.
But anyway, I digress. I think Jack really enjoyed having that freedom. For example, he’d be at the square with some friends and I’d say, I’m going to go grab some ice cream or grab something and I’ll be back. And he had no problem with that. He’s never been someone who was always needing to be next to me. Well, it depends on the situation, obviously. So I would do that.
And the first few times it felt really weird, I’ll be honest, but it kind of became the thing. And then where our apartment was, there’s a lot of steps in Syros. I climbed a lot of stairs, there were a lot of steps. And there were a few flights of stairs and it led to a playground. And Jack would often just leave our apartment, obviously he would tell me, and just go to the playground on his own. And then I would come later, but I didn’t feel the need to walk him there, and that was pretty cool.
And so the things that I did learn or experience there that I wanted to share is, well, first of all, pretty much every person there was an entrepreneur. Not everyone, but almost everyone had a business. It ran the gamut. We weren’t all just physicians, by the way, I think maybe a quarter of us were physicians, but there were a lot of other different types of entrepreneurs. And that was super cool to just like learn about what they do, et cetera.
And everyone had different skill sets and so people would kind of just offer these workshops. And so one of them offered a values workshop where we got to think about the values that we either have or want to have, and then make a conscious choice to be those values and live those values. And that was really great.
It’s something I’ve always wanted to do. And so I made my list of five and we got to define them, et cetera. And so that was really useful to me and I’ve been using that to kind of like think more about my life vision.
And so the month of Greece was really meant for, I really wanted it to be a month of visioning where I really thought about where I wanted my life to look like to be, et cetera. And I’ll be honest, what I realized is I pretty much have the life that I want. And to me, that’s sort of driven by freedom. And to me, freedom means different things, right?
People use the word financial freedom, and I think there’s so many different ways to define that. But to me, it’s really the freedom to, I guess you could say it’s time freedom and it’s flexibility, et cetera. And that’s way more important to me than the amount of money that I bring home, right?
Like I’m just thinking about this, if I worked as a full-time dermatologist and really hustled, I would probably make double of what I take home now, but I wouldn’t trade that for many reasons. Number one is I would have a lot less free time. I wouldn’t be able to take time off when I wanted to. If I had to pick up my son from school or sign up for something where the hours didn’t quite align I could still do it, whereas in a normal work situation it’s just much harder. There’s just so much less flexibility.
And being able to take a month to go to Greece, I think actually I was gone for about five weeks. And in case you’re listening and you’re like, that must be nice, there were actually two physician couples who both work clinically full-time and they were able to do it. So I say that because maybe it is possible for you to do something like that.
There was another couple, not physicians, but they both had full-time jobs and they were able to do this as well. And it took some planning. It wasn’t like something they just decided to sign up for, but they wanted to do it and they figured out a way to do it.
And so I’m not saying that you should plan for something like this, but what if you could? What if you did take a month off and purposefully didn’t do much? Which is much harder than you actually, because again, most days I was like, oh, I should have worked in my business more, or I should have figured things out. And as you know, any sort of thought that has the word should is never useful.
I personally think it’s such a great idea to spend time, when I say time, like more than three nights or four nights, like honestly, even a month isn’t that long when you think about it, to just learn how other people live, learn about their culture. And it’s just so easy to get caught up in our lives at home, and I don’t know, I always love being reminded that there’s just so much out there that in many ways my life is insignificant.
I don’t mean that in a diminishing way, but sometimes it’s really easy to be so self-focused on what’s going on with you, your family, to forget that there’s like a whole world out there. And I don’t know about you, but it always helps me zoom out and realize, oh, what’s actually really important?
Now this was an experience that we really enjoyed. And so we actually signed up to do this again next summer. And I totally want to do a school year version of it, but not right now. And we’ll just have to see. You know, anytime you’re out of your normal environment, it always is a great opportunity to, again, zoom out, think about what you want your life to look like. And to also appreciate what you do already have and how much there is to be grateful for.
Now, not too long after I returned from Greece, I learned about the death of a physician who passed way too early and left two young children and also a physician wife. And I was trying to think of what I should call him. I guess you could say partially a mentor, but he is a dermatologist and someone I met when I was in medical school and someone that I wouldn’t talk to very often, but every once in a while we would have a conversation.
And I think all of us, whenever something like this happens, it kind of shakes you. And again, always such a great reminder of just how short life is and helps you sort of realize that so many of our problems just really aren’t that big of a deal. And it’s always an opportunity to think about things like, okay, what am I tolerating? Why am I tolerating it? Because most of us live our lives like, well, there of course there’s going to be tomorrow.
Or even like in the context of retirement, like, well, I’m investing now so I can retire in 20 years. But like, how can you do some of those things now? In a future episode I’m going to be talking about sort of the different things, I should say basically physical wellness and just vitality is one of the values that I chose. And how do I optimize that? How do I optimize my body for longevity, for lack of a better description?
And so when I found out about his death, it just really struck me how fragile life really is and how it’s so important to really know what’s important to you and to see how our fears are stopping us. I still have a lot of fear about a lot of things. And the more that I see, the more that I experience, I just know that I don’t want to die with regret.
I don’t want to feel like I put something off because I was scared. And this experience in Greece and what I just talked about with one of my dermatologist mentors passing has really been shifting sort of how I look at life and how I live my life and what are the things I’m putting off that I probably should do something about so that I don’t die with regret.
And it’s like, how do you bring this into the life that you need to live now, right? Like if you have kids and they’re going to school, you know, whatever you do to bring income, most of you are working as physicians and life goes on. And so it’s always a balancing act. I kind of hate that word, but I think you know what I mean.
And so I think it’s so important to have a compass, a vision, and I’m actively working on a process now. How do you create a vision? And then what, or rather I should say, how much money do you need for that vision now and later, right? Because we have different seasons in life.
And so I’m really excited about this and I’ll be probably teaching it in my fall cohort of Money For Women Physicians, maybe I’ll teach some of it at our Live Wealthy Conference taking place in February of 2025. And it’s about half sold out now, and so if you’re interested in going, I would definitely grab your ticket at wealthymommd.com/conference. And many of the physician entrepreneurs that I spent time with in Greece will also be there. Dr. Sunny Smith, Dr. Letizia Alto, her husband, Dr. Kenji Asakura, Dr. Peter Kim, and other amazing physicians as well.
And so I hope you learned something, or I hope you’re taking away something from this episode to just take a minute to slow down. It’s okay if you binge on Netflix, it doesn’t mean that you’re lazy. It’s okay if you do nothing and just lie around for a day or an hour, and maybe it’s exactly what you need.
Okay, I’ll talk to you next week.
Hey there, thanks so much for tuning in. If you loved what you heard, be sure to subscribe so you don’t miss an episode. And if you’re listening to this on Apple Podcasts, I’d love for you to leave a review. Reviews tell Apple that this podcast is, well, awesome. And it will help women find this podcast so that they too can live a wealthy life. And finally, you can learn more about me and what I do at wealthymommd.com. See you next week.
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213: Moving Smarter: Managing Costs and Adjusting to a New Life
When my family and I moved, it was more than just a change of scenery—it was a whirlwind of new challenges. We barely had time to settle in before I jetted off to Greece for five weeks. The new house felt overwhelming with its extra space and unexpected tasks like dealing with the humidity. The move wasn’t just about a new address; it was a complete shift in our lifestyle.
Moving was expensive, but my husband’s relocation allowance allowed us to hire full-service movers, which was a lifesaver. Adjusting to our new state involved dealing with different water quality, new routines, and extra sun protection.
In this episode, I share our moving experience, the financial decisions we made, and tips for navigating such a big transition. You’ll also hear about the importance of having a spending plan that aligns with your life goals. Tune in to learn about the real costs of moving, unexpected challenges, and how to keep your finances on track during major life changes.
Learn more about Money for Women Physicians, an exclusive money coaching program to get your money and mindset working for you.
Hey! We have just a few rooms left at our amazing group rate at the Four Seasons Oahu for the 2025 Live Wealthy Money and Wellness Conference For Women Physicians. Don't miss this chance to join us in luxurious Hawaii with incredible speakers to focus on money and living your best life. Virtual tickets are also available!
What You'll Learn from this Episode:
- How to manage the real costs of moving and make smart financial decisions.
- The benefits of hiring full-service movers for a stress-free relocation.
- Tips for adjusting to a new home and state, from dealing with humidity to water quality.
- The importance of creating a spending plan that aligns with your life goals.
- Practical advice on navigating unexpected challenges in a new environment.
- Insights into the pros and cons of renting versus owning a home.
Listen to the Full Episode:
Featured on the Show:
Welcome to The Wealthy Mom MD Podcast, a podcast for women physicians who want to learn how to live a wealthy life. In this podcast you will learn how to make money work for you, how you can have more of it, and learn the tools to empower you to live a life on purpose. Get ready to up-level your money and your life. I’m your host, Dr. Bonnie Koo.
Hey everyone, it’s been a while. If you’re a regular listener, first, thank you, and then you may have noticed that it’s been a few weeks. It’s been a minute. Well, a lot has been going on, and if you’ve been following me, you may know that we moved from New Jersey to Tampa. And pretty much right after the movers, the truck came, four days later, I went to Greece for a month. In fact, I think it was five weeks.
So there’s been a lot of change. There’s been a lot going on, and I was thinking about recording an episode about all the financial aspects of moving and any tips I could share with you, but really, all I can say is that moving is really freaking expensive, and there’s really no way around it.
Well, obviously, there is, but what I have learned is, number one, I’m no longer in college. I cannot move by myself like I used to. And Matt’s job gave us a pretty generous relocation allowance, and let me tell you, I used it all up, most of it anyway. We probably have a few thousand dollars left.
But what I did was I hired full service movers, and so what that means is they packed, they moved, but I didn’t have them unpack because I hired organizers that came that fully unpacked, put all the boxes away, put everything away, and then I think they were here for like three days because they had to unpack, and then they had to organize by room.
And let me tell you, that was the best money I’ve ever spent. I could not imagine having to put all of it away by myself because, let’s just face it, Matt probably wouldn’t have helped that much and he doesn’t really know where things go, and this is not a skill I’m very good at, right? I totally could have DIY this, but again, I’m so, so glad that I spent the money on it, plus it got reimbursed, so that was amazing.
Now this move was prompted by a pretty sudden job offer for Matt in Florida. As you know, I work remote and so I really could move or live anywhere, I guess. I will say I do not enjoy or have not enjoyed all the logistical challenges of moving states, you know, like getting a new license, having to register the cars, and moving my LLC from New Jersey to Florida, all that kind of stuff. However, we are definitely excited about no state income taxes, and we moved into a much bigger place that is cheaper than what we were paying in New Jersey.
But here are a few things that I’ve learned, and keep in mind that I have literally slept in this new house for maybe two weeks total when I’m recording this, okay? So there’s way too much space, which to me means a few things. One is there’s way more opportunities for Jack to leave a mess. There are more toilets to clean, and there are just more ways for things to get disorganized and for dust to collect.
And we didn’t have, at least in my opinion, I don’t think we had a lot of stuff to begin with. And we pared down even more after the organizers came, because I just noticed I really don’t need this, I really don’t need this. And it’s something that I think all of us strive for, is to become a bit more, I don’t think minimalistic is really what I’m striving for, but like not having things that I don’t need, right? I definitely don’t want stuff that I don’t really need. And so moving has been a great opportunity to pare down and get rid of a lot of things.
And so here are a few things I’ve noticed about living in Tampa, Florida so far. It’s very different from New Jersey and here are the things that I specifically have noticed. The water here is very different. And having lived mostly in Northern New Jersey and New York City for pretty much my whole adult life, the water isn’t soft in New Jersey or New York, but it’s nowhere near as hard as in Florida.
A lot of stuff was covered with limescale, the dishwasher. And the water just smelled funny. I think it smelled like sulfur and I could tell right away that there’s something weird about the water. And maybe you know, hard water, very hard water is not good for your skin. It’s not good for your hair. It’s not good for appliances or pipes. It just clogs everything.
And so I have had to do a few things. I had to get a water conditioner/softener installed. We also got reverse osmosis installed for drinking water. I had to do a deep cleaning of the dishwasher twice with citric acid. I love citric acid as a cleaning agent, it does wonders and dissolves limescale.
And so I did it twice and now the dishwasher works again and it actually cleans because Matt was like, oh, this dishwasher isn’t very good. It’s not really cleaning the dishes. And it wasn’t, which is annoying. It’s like, why have a dishwasher if it doesn’t actually wash your dishes?
Okay, so the water is different. I’m recording this in early August and it is very hot down here. It’s very humid, although I haven’t spent a ton of actual time outside. It’s mostly going from home to the car, to drop off points for Jack or something and then back into the car. But what I have noticed when I go outside, it’s so damp. I feel like my feet are wet as soon as I go outside.
And that’s another thing, the humidity. For the first time, I have had to buy things called damp rid, and maybe most of you know what that is. But it’s like this thing you hang up in the closet that absorbs extra humidity. I had to get like a tiny dehumidifier for our bathroom because it just wasn’t really drying up.
And the last thing I will say about Florida is that because of the move, I’ve had to call a lot of places to help me with things like make sure I have everything in order to apply for a new driver’s license, which is actually tomorrow. What do I need to register the car? Make sure I don’t forget any documents.
Let me tell you, everyone I’ve talked to has been amazing. So nice and so helpful and genuinely want to be helpful. I will tell you, that is not the case in New Jersey. In fact, I do recall a specific conversation I had with the New Jersey business department about LLCs, and this lady was so rude and downright mean to me. And basically said she was not going to help me and that it was my fault. And I forget what was the deal, but I ended up having to hire a lawyer to deal with it because I was like, I’m not dealing with this.
But so far in Florida, everything has been actually really easy. And that is something I have found very pleasantly surprising. Now, with the move there has been a change of income in terms of Matt, change of benefits. And then also I am making slightly more because of the no state income taxes. And so this was a really great opportunity to kind of reevaluate our spending plan and our goals and to just make some new goals.
And so what that means is I sat down, I have a spending plan template and I kind of just listed all the things that we would need to pay for. Kids are really expensive. It’s on me that I chose a private school for Jack, but he does get a lot of extra support like speech and OT. And he needs to get some catch-up tutoring because he’s transitioning from a Waldorf school to a mainstream school.
And so I put all that in, right? And I already have, you know, pre-selected categories that aren’t really changing, but maybe the amounts are changing and all that kind of stuff. And this is something that I think it’s so easy to not do. And a few episodes ago I had Nick True, I think it actually was maybe in June.
And if you skipped that episode, it’s episode 211, I really encourage you to listen to it. Nick, I just love that guy. He is so good when it comes to cash flow and spending plans, AKA budgeting. And we talk about it in a way that maybe you haven’t heard before. And so I really encourage you to listen to that episode.
I always love connecting with Nick. I’ve known him for quite a few years right now. And it’s so easy as higher income women to kind of think that looking at our budget or how we spend our money is really not that important because we don’t run out of money. Assuming that your checking account doesn’t go negative and you’re not able to pay your credit card bills in full, then you’re “fine,” right?
And you totally might be. But there’s so much wisdom and power in knowing actually where your money is going. And it’s not just to know where your money is going. It’s like stepping back, how do we want to live? What do we want our lives to look like? And what is the spending plan that’s going to support that? That’s why I love spending plans and I love looking at how I spend my money every week.
I use this budgeting program called YNAB. I'm sure you guys have heard me talk about it a lot. And so I was doing a lot of YNABing, looking at the spending and honestly delighted that we’re going to have disposable income. But I also had to keep in mind that that didn’t mean that we were just going to spend the difference, okay?
Like we are saving money on renting right now, but we probably want to buy a home in a few years. Although I will say right now in Florida, we just went through, it wasn’t a hurricane, it was a tropical storm, but it was almost going to be, I think, category one, I may have gotten the categories mixed up.
But basically, apparently it’s a no big deal rainstorm, but Matt and I thought it was going to be a big deal. But I guess, you know, for Florida, it’s like, oh, this is just a rainstorm. But there was a lot of rain and there’s all these ponds and lakes in Florida, and I have no idea why. And some of them got really full around me. So I’m just guessing that flooding can definitely happen when it rains a lot more.
Anyway, I digress. Any opportunity I think that sort of forces you to reflect and think about how you want your life to go or keep going is always a good idea. It’s so easy to kind of go on autopilot and be like, just not think about it, right? And did I mention how expensive it is to move?
I talked about all the moving expenses, but then you got to buy all this stuff for the new place, right? Like I had to buy bath mats. I had to buy, every day I noticed there’s something else I have to buy. Our old place had these shades that went up and down and they were pretty nice. We lived in a luxury high rise building and now we live in a townhome. And so there are blinds installed, but I bought curtains for all the windows. The landlord left the curtain rods, thank God. And so, but I needed curtains. I guess I didn’t need to, but otherwise it just looks kind of weird without curtains, right?
Now, a bunch of people have asked me why I didn’t buy a place. Although if you’ve known me for a while, you know that I’ve pretty much, yeah, I’ve always rented. I’ve never actually owned a home. Isn’t that crazy? And this is something I’ve been thinking about a lot because it’s one of those things that’s kind of accepted culturally, socially, I don’t know what you’d call it, that one should own a home as an adult and that’s like a thing that you do.
And I’ve personally, it’s not that I’ve always questioned it. I think it’s honestly how I personally grew up. We only lived in a house that my parents owned once, otherwise we’ve always lived in pretty small apartments and we moved a lot. And that was because of the shifting financial landscape of how my parents were doing. And so I’m sure it would have been different if I sort of lived in the same home that my parents owned for most of my childhood.
And of course I’ve heard all the things about why you shouldn’t rent and why you should own, et cetera. And I personally love renting. I love the freedom it affords me. I love that if something breaks, it’s generally not my responsibility. And moving to a completely new place where I don’t know anything, like truly don’t know where anything is, people talk about these things, I have no idea what they’re talking about. You know, it gives us time to figure out where we want to live.
Now, moving sucks and moving to our new townhome, and now I’m like, okay, if we move again in like two years, we figure out where we want to live, we know we’re going to stay here, that feels daunting. But it’s very different from a long distance move and I’ll deal with that later, right?
But I’ve already noticed a few things like, oh, this might not be the best area for us long-term. And I don’t really know. I think we have to see how things are when Jack starts school. But if we decided to buy right away, obviously we would have taken our time to really figure that out. But I feel like, how do you really know if it’s the neighborhood you want to live in without actually having spent time there?
I don’t know, but we would definitely love the option to buy if we felt we were ready to do so. And so that has to go in the spending plan too for like a down payment, or we’d have to pull from investments. It’ll probably be a combination of all of the above.
The last thing I wanted to say about Florida is the sun. Y’all know I’m a dermatologist, right? Because I have had to rethink some of my habits. Living in New Jersey, it’s not that it doesn’t get sunny, but it’s not something I have to think about year round, really just for the summer. And so here are a few things that I’ve had to institute and change.
Okay, number one is I have bought these stick-on sunshades for the windows. I guess I could get like a UV coating, but honestly right now I just can’t deal with any big projects at this point, nor do I want to spend thousands of dollars doing that for the two cars that we have. And so I bought these little stick-on window shades that you can easily stick on and remove so when I’m driving, you know, I’m not getting all this sun to the left side of my face.
And obviously I always wear sunscreen every day, and here I am double layering. And what that means is first I apply a layer of chemical sunscreen followed by physical sunscreen. And the products that I currently use, although it changes from time to time, I'm currently using La Roche-Posay. I think it’s called Mela-C, M-E-L-A dash C. And it’s specifically for if you have melasma or pigmentation, et cetera. Right now I’m using EltaMD UV Elements, and then I also mix it with a little bit of the IT Cosmetics CC Cream to give a bit more coverage.
And I wear a hat. And in fact, I put hats everywhere. I bought all these visor hats. I have one in my car. I have one in the little hallway by the garage/front door because you need to wear a hat here because it’s just sunny all the time. And I’m always having to put on sunscreen on my neck and my chest because the neck and the chest are the areas that women tend to not put sunscreen on. And those are constantly, constantly exposed.
In fact, I even ordered this sun shrug with sleeves to leave in the car. It hasn’t arrived yet, but I’m just noticing that these are the things I’m going to have to really pay attention to because I will be doing, well, I don’t know. I’ll probably be doing some more driving here with commuting to Jack’s school and whatnot, and so I’ve had to really up my sun protection game.
And I have my brush on sunscreen that I carry in my purse for touch-ups. I don’t think they’re a good idea to use as your primary source of sunscreen, but they’re great for reapplying. When I’m at the beach, I honestly just reapply the cream. And specifically, right now I use Isdin I-S-D-I-N. I don’t know exactly the type, but it’s their shakable tinted sunscreen. That’s what I wear at the beach and I reapply.
And I do actually really enjoy being at the beach. In fact, I went to the beach a lot in Greece. I think I’m gonna have to do a whole separate episode about my experience in Greece, being there with other families, being there with mostly entrepreneurs and just sort of like what I’ve learned there and all that stuff and how it was a month of rest in terms of my business.
I spent very little time working in or on my business, although that wasn’t exactly planned. I was going to do some work, but it just ended up not really happening. So that will be another episode for sure.
But these are my thoughts so far about the move from New Jersey to Tampa, I hope you enjoyed it. Thank you for sticking around and I will see you soon.
Hey, we only have a few rooms at our amazing group rate at the Four Seasons Oahu for the 2025 Live Wealthy Money and Wellness Conference For Women Physicians. Last year’s conference sold out really quickly. Thankfully in 2025, we have a lot more spots, but it’s already close to about 40% sold out and with very few rooms left at our amazing pricing.
And so to learn all about it, wealthymommd.com/conference. You definitely do not want to miss this amazing opportunity to be in the luxurious Four Seasons Oahu in Hawaii with me and an amazing group of speakers to focus on money and how to live your best life. Again, wealthymommd.com/conference. We also have virtual tickets available as well.
Hey there, thanks so much for tuning in. If you loved what you heard, be sure to subscribe so you don’t miss an episode. And if you’re listening to this on Apple Podcasts, I’d love for you to leave a review. Reviews tell Apple that this podcast is, well, awesome. And it will help women find this podcast so that they too can live a wealthy life. And finally, you can learn more about me and what I do at wealthymommd.com. See you next week.
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212: Financial Planning for Special Needs Children with Britta Koepf
Planning for a child is one of the most rewarding journeys, but it can also be quite the challenge, especially when that child has special needs. Financial considerations are crucial if you or someone you know is in this situation. This is what led me to my chat with Britta Koepf, a certified financial planner and special needs consultant who has dedicated her career to helping families navigate these complex waters.
In our discussion, Britta shares her expertise on the intricacies of financial and special needs planning, from setting up various types of trusts to exploring ABLE accounts. We dive into why it's so important to plan for multiple futures, given the unpredictable nature of special needs. Britta also stresses the importance of starting early and customizing plans to ensure your child can thrive without losing out on government benefits.
Tune in this week to pick up invaluable tips on securing your special needs child's future. Whether you're a parent, guardian, or know someone in this position, this episode is packed with practical advice and resources. We cover everything from understanding government benefits and insurance options to the role of financial advisors in planning for your child's long-term needs.
Learn more about Money for Women Physicians, an exclusive money coaching program to get your money and mindset working for you.
What You'll Learn from this Episode:
- How to set up different types of trusts for special needs children and their benefits.
- The essentials of ABLE accounts and how they compare to trusts.
- Why it’s important to plan for multiple futures given the unpredictable nature of special needs.
- Strategies for ensuring your child can thrive without losing out on government benefits.
- Key considerations for incorporating government benefits and insurance options into your financial plan.
- Advice on working with financial advisors to secure your child's long-term financial needs.
Listen to the Full Episode:
Featured on the Show:
Welcome to The Wealthy Mom MD Podcast, a podcast for women physicians who want to learn how to live a wealthy life. In this podcast you will learn how to make money work for you, how you can have more of it, and learn the tools to empower you to live a life on purpose. Get ready to up-level your money and your life. I’m your host, Dr. Bonnie Koo.
Hey, everyone, welcome to another episode. So I’ve been looking for someone to talk about the financial considerations that you need to know about and estate planning wise for special needs. Specifically, if you have a special needs child, or maybe you know someone who, whether it’s a relative or a friend that does, and they might be feeling lost or overwhelmed with what they need to do to best prepare for their child.
Of course, there’s, you know, special needs covers a huge range, right? I’m definitely not an expert on this. I’ve been looking for someone to educate us and I have found her. And so I hope you learn a lot. And really my goal, if you’re listening and this applies to you, is that you get this all done. And if you have things in place, the things that we’ve talked about, I also want to make sure that you’re revisiting this periodically, and especially after major life changes like divorce or major wealth changes.
And so I’m assuming the same type of changes apply in this case as well. So have a listen to my conversation with Britta.
Bonnie: Okay, welcome to the show, Britta.
Britta: Thank you for having me.
Bonnie: I’m so excited that you’re here because I have been looking for someone when we first met to talk about this topic because it’s something I don’t have expertise in. And I know that many moms in the audience have children with special needs or a relative, or even maybe a sibling. And I even have found it hard to find good information about it.
And so before we go on and discuss all the things, can you introduce yourself, tell us a bit about what you do and how you got into it?
Britta: Yeah, my name is Britta Koepf. I am a certified financial planner, as well as a charged special needs consultant. I have been working in finance for about nine years now. About half that time I’ve been kind of focusing on trying to get into the special needs and then mostly working in the special needs market. It’s a very fulfilling place to be working.
I mostly got into it because I wanted to find a way to both work with money and also help people. Not just make rich people get richer, which I find also very fulfilling. But I wanted at least part of my work to be really helping someone who might otherwise not be doing so great in the world.
And so a lot of what I do is helping people who may be wealthy themselves, but have a child who might need government benefits that would not be there if they pass along that wealth to their child. And so I sometimes say that what I do is help people’s children not be in poverty, because without the ability to find a way to pass on that wealth and keep the government benefits, these kids and then when they’re adults are forced to have pretty much no assets and very, very little income.
And without it, a lot of parents think that the only option is to disinherit the child completely. And then they have to rely on siblings or aunts and uncles to support them. And that’s just not, in my mind, the best way to do it. So my job is to help people keep their kids out of poverty, and it’s extremely fulfilling.
Bonnie: Yeah. And remind me, but I think you also said that some of your clients, they’re the ones with special needs, too.
Britta: Yes.
Bonnie: It’s not just the families who have a child or a sibling, right?
Britta: Yeah, I have some clients who are neurodivergent or have physical or mental disabilities themselves. They chose to work with me both because I understand the disability space, so I have some clients who are going to be in the future needing to be on disability benefits, and they want to plan for it or who are, one spouse is already on disability. And for them, it’s very useful for me to know how to work with these uncertainties as well as the intricacies of how you get the benefits and how they can work into a full financial plan.
I have other clients who might never need government benefits. They have a disability, but they’re also able to earn money. They’re good with money. They’re able to save money. But when they hire a financial advisor, they want to find someone who understands the needs of someone with a disability, because maybe they have a different way of communicating because they’re neurodivergent and they need a little bit of prodding with some things or understanding of how to keep conversations on track.
And just understanding the way that different kinds of disabilities or chronic illnesses can affect someone’s finances and just their communication is really helpful for people.
Bonnie: Well, first of all, I just want to say, and you kind of just said it, is that special needs/disability et cetera isn’t black and white. Because I think it’s easy to say, oh, you’re special needs or you’re not. So there’s like a gradient sort of depending on each person.
Britta: Yes.
Bonnie: And so the main thing I want to talk about today is sort of like what are the things that anyone who has in their life, someone with special needs, what are some of the financial things they need to understand and know about?
For example, the only thing I really know is that there are some special types of trusts, like special needs trusts, and that there’s something called ABLE, A-B-L-E. There’s probably more out there. I’m just trying to think how to structure this, because obviously we can’t go through everything in one 30 minute podcast. But I want to give sort of some broad strokes and also maybe a little push for those parents who have been maybe just avoiding really putting things in place.
Most people put off estate planning, so there’s that part too. It’s like if anyone’s listening and you have someone in your life with special needs or you know someone, make sure you share this podcast episode so that they know. It’s like, basically, I just want them to seek out help and get all this stuff done. And it’s like a huge peace of mind to have all this stuff taken care of.
So, all right. So why don’t you walk us through sort of like, what are like the main things that you go through with a new client?
Britta: So the first thing that is on people’s mind when they come to me depends on where they are in life and how old their kids are or who they’re helping because sometimes it’s, you know, their sibling. But how old that person is, because what’s most important if someone has a three-year-old and what’s most important when they have a 20-year-old and what’s most important when they have a 40-year-old are going to be completely different things.
Bonnie: Sorry to interrupt. Why don’t we focus on moms with younger children?
Britta: So the primary concern that a lot of people have when they have children who are maybe under 10, or really under 15 I’d say, is you still have very little idea of who this person is going to grow into. You have your hopes and your dreams, but you don’t know. And when someone has a disability, a lot of the time we have to plan for multiple futures.
If a child has autism, then that can be anywhere from an adult who is able to live on their own and thrive, manage their own money, make their own money, to someone who will be dependent on their parents or their siblings or their aunts and uncles or their whole community for their entire lives for all their money, won’t be able to manage it, won’t be able to have it.
And sometimes if someone has a three-year-old who’s just been diagnosed, they don’t know. And so we end up planning for multiple futures and we use different scenarios. And when we’re looking at plans for estate planning, if there’s really any chance that that disability will make it so that they cannot manage money or they’ll be on government benefits, then we need to have that special needs trust in place.
There are two main varieties, there’s a third party and a first party. So a third party trust is what the parents would be setting up. And the first party trust is kind of what the kids or their guardians will be setting up if the parents don’t get their estate planning in order.
But a third party trust, you put money in while you’re alive or after your death. So most of the time it’s funded through the estate. But if you have it already in place, sometimes grandparents from their estate will fund it. So it might be around before you die because other relatives or other loved ones will have put money in.
But it is a trust where the money goes in and you say this money is not going to be controlled by that person with special needs. It is restricted. And the language of the trust, I’m not a lawyer, so I don’t know the exact language, and it’s going to be different in every single state.
Bonnie: Yeah, but you’ve read a lot, I’m sure.
Britta: But it’s designed in such a way that says this eventually adult will not have any access to this money. They’ll not be having any control over this money. So government, you should not be counting this money as theirs as long as they fulfill certain requirements.
And sometimes the trusts are a little bit more restrictive. I prefer them to be as loose as possible while still following the rules so that the trustee can use it for whatever they need, whether that is for entertainment, for clothing. Sometimes you want to avoid food and shelter to keep certain government benefits. But, you know, for paying for the kids’ vacation, you know, all these different things to make sure that they are having a life like you’re dreaming of them having because you’re funding the future with this trust.
Bonnie: Okay, so the special needs child, because you mentioned the word trustee. So are they a trustee but they – It sounds like it’s a different type of role than a regular trustee of a regular living trust.
Britta: So the trustee of the trust will, when someone sets it up, the trustee will be the same person who put the money in, usually.
Bonnie: Okay.
Britta: Usually it’s set up so it’s the person who put the money in. Once they have died, they name someone else. Either a family member or in my personal opinion it’s better to name a corporate trustee, so a bank. They charge a good bit, but it’s a hard role. But that’s the person who will dictate how the money is invested. They’ll dictate how the money is spent. And they will do all the bookkeeping and follow all the rules that are a big headache. And that’s why you want the corporate trustee so that this child’s life is funded, so it’s a great life but they never have control over the money so they’re still getting their government benefits.
Bonnie: It almost sounds like an irrevocable trust, but it’s –
Britta: It is. It’s an irrevocable trust. It’s a kind of irrevocable trust.
Bonnie: Okay, but it’s a specific type.
Britta: Mm-hmm.
Bonnie: Okay, got it.
Britta: Yeah. So like other trusts, it starts out as a revocable trust most of the time and then turns into an irrevocable trust. And then it just has these restrictions in place to make sure that it’s used specifically for that one party and making sure that they keep their government benefits, if that is the best thing for them.
Bonnie: So I think the first main point here is that you probably need to get a special needs trust in place.
Britta: Yeah.
Bonnie: And as early as possible, it sounds like is what you’re saying.
Britta: As early as possible. If someone is just starting out and they don’t have any assets, it’s not as important. But if someone has any kind of assets –
Bonnie: Well, it could be like a retirement account, right?
Britta: It could, yeah. Oh yeah, that definitely counts. But a lot of the time people are starting out, like when someone has children, once their babies are born, a lot of the time they don’t have much money yet. They might have just graduated from medical school and mostly they have debt to their name.
So that person, it’s still very important to have the estate plan in place and be planning on that trust. It’s not this fire that needs to be under them. But once someone has assets, it is something that is needed because the moment they’re gone, their child will probably – Well, once both of the parents are gone, they’ll probably be qualifying for some government benefits if they qualify, if they have low enough assets. And making sure that that trust is in place, maintains those benefits.
Bonnie: I mean, most people will have some sort of 401k or 403b, a Roth IRA and hopefully life insurance in place. And so, yeah, the 403b might not be a lot, but the trust should be like, maybe the second beneficiary. Usually it’s the spouse.
Britta: Yeah, the spouse and then the trust.
Bonnie: The trust, yeah. So that’s number one. And then let’s talk about the ABLE thing. Can you tell us what it is and why someone should consider having one?
Britta: So an ABLE account is kind of an alternative to the trust. It is easier to set up and it’s not expensive to set up. You can set it up right away. And it is essentially kind of a 529, which is a college savings account, only for people with disabilities. And it actually is technically a 529 of a different variety.
But an ABLE account is a savings vehicle and you put money in, you don’t get the federal deduction that you would in an IRA. And sometimes you can get a state deduction, sometimes you can’t get state deduction. But either way, the money will grow in the account if you are investing it.
You do have a limit into that account of the gift tax. So I believe that’s $18,000 this year, that’s all that can be put in. That’s not every person can put that in, per beneficiary. So if the parents put the whole amount in, the grandparents can’t put extra. That is pretty limiting. But you can put that money in, you don’t have to set up that trust. And that can grow. It won’t impact any government benefits until it hits $100,000.
Bonnie: Okay.
Britta: Once it hits $100,000, it does impact government benefits.
Bonnie: Okay. So it sounds like it’s not something people would have in addition to a special needs trust.
Britta: It depends. There are things that if special needs trust pays for, it might impact government benefits, such as paying for rent. And so a lot of the time, you want to avoid paying for that rent if the child is on supplemental security income. However, ABLE accounts can pay for that rent and it won’t have any impact.
So I have clients who have kids who are 18, 19, and they’ve moved away from home and they’re now in an apartment. And so they put a few hundred dollars into that ABLE account every month, that few hundred dollars goes to pay their rent every month. And so it kind of passes through so that it can keep the government benefits because the parents also can’t pay for rent. But it allows people to kind of get around that problem with losing SSI because of people paying for rent.
In that case, it can be good to have. Even if someone has a special needs trust. It also allows there to be money that is being used while the parents are alive. And so I don’t usually have people with large ABLE accounts. There are other downsides. It’s subject to Medicaid payback. You don’t want a big ABLE account.
But another reason to have money in ABLE account is there are ways of giving the child access to spending money through that ABLE account, because if they’re using it to pay for qualified disability expenses, and that can include things like food sometimes, then they can have like a debit card that they use to pay for things. And that is really empowering that they’re not constantly having to ask for money. It feels good.
It also, because it grows tax-free, there is that benefit. There are reasons to have a small ABLE account. I wouldn’t want it to go over a hundred, but it can be a beneficial tool. And it’s nice to have a small ABLE account in addition to the trust.
Bonnie: Okay, so what are some other considerations that someone would need to know?
Britta: So I think the major consideration after the trusts that someone has throughout their child’s life is how are we going to figure out how much money they will need? How are we also going to get them that money?
Bonnie: Yes, that’s a wild card, right?
Britta: It’s a wild card. And when you go to a financial advisor, one of the main things they’re going to do, because it’s one of the main things people have asked questions about, is retirement. They’re going to project out your retirement and say, here is how to meet the goal of retirement. And here’s to make sure you have money at the end, you don’t run out.
And sometimes people do have legacy goals. They want to leave each of their children a hundred thousand dollars or half a million. A lot of the times they say, my kids can figure it out. I don’t need to leave them anything.
When someone has a kid with special needs, they have to say, I need to make sure I leave X number of dollars, at least X number of dollars to this child. It’s not an afterthought where it would be great if. It is a major priority for these people. So making sure they leave that, we are planning to leave that legacy and also figuring out how much to leave.
So sometimes people say that it’s planning for multiple retirements because you’re planning for your own retirement and then you’re planning for your child’s retirement after you’re gone, because they’ll probably hit retirement age about the same time you die, statistically. And then you have to plan for yet another 30 years after you’re gone that money will have to last. Or you die early –
Bonnie: Can we just pause for a second?
Britta: Yeah.
Bonnie: I mean, I think we need to acknowledge that there are more challenges when you have a child with special needs in terms of money, right?
Britta: Yes.
Bonnie: And so is it safe to say that they’re going to need more money than the average person who doesn’t need to do this? I mean, I think that’s just without question, right?
Britta: Oh yeah. So almost everyone does need more money if they have children with special needs, both while the child is alive. While you’re raising that child, you have to be paying for therapies and such. And you have to plan for when they’re an adult, supplementing. And when you’re gone, make sure that everything that you had been paying for is covered.
There are times where the kids are 20 and they’re on their own, they’re launched. And we’re saying, okay, well, we don’t actually need that much more. I mean, you know. But when someone has a young child, we definitely have to prepare for a future when you’re not there.
Bonnie: It sounds like get a lot of life insurance is what I’m thinking.
Britta: Frequently. A lot of that is going to be still term. You can still do a lot of this with term. As long as you plan to have that extra money by the time the term runs out and you are saving on the side, you can do this all with a term policy.
There’s also policies called second to die. So if there are two parents in the picture, you can save some money on a permanent policy because it won’t pay out until the second of you dies. So the spouse won’t get anything, but that way you can fund a trust with that money.
Bonnie: Oh okay.
Britta: So if someone is in their thirties and they buy this policy and it says second to die, you can frequently buy it without much cash value. So it’s more expensive than term. It’s definitely more expensive than term, but it lasts for the rest of your life and it will pay out, help fund that trust. It also makes it so if one spouse is not as healthy, they might be able to get that policy because it will last until the other spouse dies.
I’m sure that there’s some situation out there that I’ve never thought of where someone has gotten folks that were higher with the second to die, but they are an extremely valuable insurance tool with special needs planning because it’s the way to fund an inheritance and special needs requires an inheritance in almost every situation.
Bonnie: So obviously there are different considerations all around. So in the insurance product, would you say that most insurance agents will be well-versed in this area or are there –
Britta: No.
Bonnie: Yeah, that was sort of what I thought. So I’m assuming because this is what you do, you probably work with – Because you’re fee only.
Britta: I am fee only.
Bonnie: Yeah.
Britta: I have my go-to people, but I’ve also talked to other people. There are specialists, insurance providers and there are financial advisors who sell insurance who are specialized. But for me, I just tell the insurance what to get. But I know that there are some, there’s one that I just heard of from a colleague who is also fee only, and he has a daughter who’s on the spectrum. And so he’s looked into this for himself. He’s very involved in the community. So he has worked to be very specialized.
Bonnie: I mean, that makes sense. Just like in medicine, we have different specialties, right? Like don’t ask me anything about broken bones, I will have no idea. But I’ll know someone who you could talk to.
Britta: Yeah.
Bonnie: What else do you think people listening should know? We talked about special needs trusts. We talked a bit about ABLE. We talked about how there are some insurance considerations. We didn’t go through specifics, but I think anyone listening who’s like, oh, I need to look into this. Well, first of all, there’s multiple things to look into and whoever you talk to, hopefully will point you in the right direction when it comes to insurances. So is there anything else?
Britta: So when it comes to government benefits, it’s important to make yourself knowledgeable on them. And when it comes to the federal benefits, especially social security and SSI, which is the one people can qualify for if they’re low income. A lot of the time they aren’t going to kick in until your kid hits 18. But there are other programs while your kids are growing up and there are sometimes Medicaid waivers that they do qualify for, even if their parents have income.
There are other supports that you can learn about by getting involved in the special needs community near you. Contact the Arc near you, which is a –
Bonnie: What’s that?
Britta: It is a not-for-profit that is national, but they have local chapters that provide education and resources and help.
Bonnie: How do you spell it?
Britta: A-R-C.
Bonnie: Okay.
Britta: So the Arc.
Bonnie: I’ll look it up right now while you’re talking.
Britta: The Board of Developmental Disabilities, all these different things. Use your resources.
Bonnie: It’s called thearc.org. A-R-C. Yeah, and it says for people with intellectual developmental disabilities.
Britta: So they are an extremely valuable resource for a lot of parents to learn about all the programs near them and just get involved, find out what’s available. If you have an assigned social worker, they will know things, but they’re probably paid by the government and can be very helpful, but they might not know everything that you would want them to. So get involved.
Bonnie: And it does stand for something, but it’s not great because it was formed a long time ago. So I’m surprised the name hasn’t changed.
Britta: Maybe that’s why they just go by Arc because I can kind of think of what it might stand for.
Bonnie: Yeah, it looks like it’s not capital A-R-C anymore. So yeah. So I don’t think they say it stands for anything anymore in terms of where the name came from. But Arc is a regular word too.
Britta: Yeah.
Bonnie: It’s just using terminology that isn’t used anymore, basically.
Okay. So no, but it’s good to know what these resources are because I think with, for example, when I was seeing a lot of patients with psoriasis, a skin disease, I would always refer them to the national psoriasis foundation or NPF. And that, you know, kind of covered everything.
And also there was like a nice kind of a legislative arm where they would lobby for certain things. And I think they say about 2% of the population has psoriasis, between 2 and 5%. So it’s sizable enough to kind of make changes when it comes to laws and things like that. I think sort of knowing what are the larger organizations where people can lean on for information is really helpful.
Now, are you saying that the Arc is a good place to learn about federal and state resources, or is there another place that you think is a good place where people can learn about it besides Chat GPT?
Britta: So Arc has a lot of information on their website. And my understanding is different chapters can have different degrees of helpfulness.
Bonnie: Yeah.
Britta: But generally, if someone has questions, go to their website, see if you can connect with them. There are also local organizations and organizations diagnosis specific. So if someone has a specific diagnosis, look up what organization, national organizations there are related to that diagnosis.
And they can help with national resources and then find local organizations, either diagnosis specific or local organizations that are just disability focused that might help people connect and learn about local resources, because Medicaid is state specific. And a lot of the guidelines are going to change as soon as you cross that border.
And so knowing other people in your state, or in some states, like Ohio, some things are county specific. So it is knowing local resources, knowing local rules, state benefits, state taxes. So contacting the local generalists is also great. And if it’s a big enough part of the population, local diagnosis specific organizations are good.
Bonnie: I also know this annoying thing about the state stuff is that it is, every state has its own thing. Like the way they tax and even just thinking as a physician, like why do I have to get a license specifically for, for example, I’m moving to Florida. And they ask for the same exact thing that New Jersey asks for. There’s an organization now called the Interpac or something like that, where it’s much easier to get a license now. They kind of accept – It’s almost like reciprocity, but not quite. It’s like a shortened application. You don’t have to do all the things.
Because I was actually looking on the Florida website and I have to get fingerprinted. I have to get official documents sent from like every – I’m just like, seriously? Because I’m licensed or have been licensed in like five other states. Medicine doesn’t change when you cross a border. Law does, so I understand having to take a bar exam specifically to the state. To me that makes sense.
But medicine, it’s like, part of me is like, just tell me to pay a fee and I’ll pay it, but please do not make me fill out 10 pages of paperwork. Because I just started doing it and I literally, I’m like, I cannot do this again. Like someone has to do this for me or I’m going to wait until they – the actually joined, so I called them. But the government is so slow moving. It got approved in March and they’re like, oh, it’s going to be at least six months until we figure out how to implement it.
And then I was like, okay, let me take a stab at it. And I was like, I’m going to wait six months because I can’t deal with this. I’m not paying all these fees and coordinating all this stuff to verify that I passed all these exams, et cetera.
So anyway, I’m just venting here, but I think it just makes it hard. And that’s just a medical license. And like I said, every state’s different, that’s just got to be tough.
Okay, so I just want to summarize what we talked about so far. We talked about special needs trust. We talked a bit about ABLE, you know, different insurance considerations, mainly in the life insurance area. And then also just knowing the federal and state sort of rules. Because my guess is, Britta, you probably don’t know every state’s rules.
Britta: I don’t.
Bonnie: You know the federal stuff pretty well.
Britta: I know the federal, I know Ohio. I do work with clients in other states and I know how to find out the information. There aren’t many people specializing, and especially not many fee-only people specializing. So I don’t want to limit myself to just working with people in Ohio because there might be people, you know, there might be states without any fee-only advisors specializing in special needs.
So I do get pretty well-versed in, you know, as soon as someone comes in from one state I will learn those benefits. And I’m very good at figuring out state taxes.
Bonnie: Hopefully they have a good CPA who can assist with that and knows that stuff, yeah.
Britta: Yes.
Bonnie: Okay. Well, this has been really informative for me. I hope everyone listening, like I said, maybe you know someone who could use this information. I hope it’s been helpful. I hope this is motivating you to either get started. And even if you have met with an estate planning lawyer, those things need to be updated. The trust needs to be funded.
Britta: Yes.
Bonnie: You know, one of the biggest mistakes in estate planning land is having a trust, but then never putting anything in the trust. It’s kind of pointless. Especially if they don’t have a financial advisor who is guiding them through the process, I think my guess is it’s something that needs to be revisited with some frequency.
Britta: Yeah, definitely need to revisit it, especially if you have someone who’s going to be dependent on you for their entire life.
Bonnie: Yeah. Okay, Britta, how can people find you if they’re interested in working with you, especially if they’re in Ohio, since you know Ohio very well.
Britta: My website is probably the best place to go to it’s tranquilfp.com. That’s like tranquil FP, like tranquil financial planning. So that’s the website to find me. And then there’s on the contact us page, there’s a little questionnaire someone can fill out, that will be sent to my email and I will get back.
And sometimes someone will fill it out and I’m not a good fit for them. So what I do in that case is I help them find someone because it’s very important to me that someone finds the right advisor and I’m not always the right advisor. So I have like a list of different people to send them to.
Bonnie: Oh, great. Okay. And we’ll link that all in the show notes. So in case you missed that, it’s so much easier to look at something and just click on the link.
So, okay. Well, thank you, Britta, so much for your time and for educating us about this very important topic.
Britta: Thank you for having me.
Hey there, thanks so much for tuning in. If you loved what you heard, be sure to subscribe so you don’t miss an episode. And if you’re listening to this on Apple Podcasts, I’d love for you to leave a review. Reviews tell Apple that this podcast is, well, awesome. And it will help women find this podcast so that they too can live a wealthy life. And finally, you can learn more about me and what I do at wealthymommd.com. See you next week.
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211: What You Need to Know About Cash Flows with Nick True, Owner of Mapped Out Money
This week, 
I had the pleasure of sitting down with Nick True, the founder of Mapped Out Money, to discuss the often overlooked world of cash flow management. Nick's journey into financial coaching started with a blog and YouTube channel back in 2015 where he and his wife explore the nitty-gritty of day-to-day financial planning. Unlike the often glamorized world of investing, Nick argues that mastering your cash flow is fundamental - it's the backbone that supports everything from budgeting to long-term financial security.
A common pitfall among high earners is neglecting cash flow. Nick’s approach isn't about being overly frugal, but rather about aligning spending with personal values and long-term aspirations. From the importance of tracking every dollar spent to the strategic use of some amazing tools, we discuss the transformative power of understanding where your money goes.
Tune in this week to learn how to navigate your financial journey with clarity and purpose. Discover why mastering cash flow isn't just about budgeting - it's about gaining the freedom to live the life you envision, without financial stress holding you back. Join us as we uncover practical steps to align your spending with your values, and to build a sustainable path towards your financial goals.
Learn more about Money for Women Physicians, an exclusive money coaching program to get your money and mindset working for you.
What You'll Learn from this Episode:
- Why mastering cash flow is crucial for long-term financial security.
- Practical strategies to track and optimize your daily spending habits.
- How to align your financial decisions with your personal values and life goals.
- The benefits of using tools like the You Need a Budget (YNAB) app for effective budget management.
- Insights into common pitfalls high earners face with neglecting cash flow management.
- How to challenge your approach to money management and start building a path towards financial freedom.
Listen to the Full Episode:
Featured on the Show:
- Follow me on Instagram
- Nick True: Mapped Out Money | YouTube | Podcast
- You Need A Budget
- YNAB Coaching
- The Ultimate Blueprint for an Insanely Successful Business Hardcover by Keith J. Cunningham
Welcome to The Wealthy Mom MD Podcast, a podcast for women physicians who want to learn how to live a wealthy life. In this podcast you will learn how to make money work for you, how you can have more of it, and learn the tools to empower you to live a life on purpose. Get ready to up-level your money and your life. I’m your host, Dr. Bonnie Koo.
Hey everyone, welcome to another episode. So I have been waiting for a while to have my friend and colleague, Nick True, on the podcast to talk about cash flow, spending plans. I know, everyone’s favorite topic, but you are going to love this conversation.
Nick and I really share the same sort of paradigms in how we think about this and why we think it’s so important. And how you handle your current cash flow is probably way more important that all the other things like investing your money et cetera, because at the end of the day, the reason why you’re growing your money, the reason why you’re managing it is so you have cashflow today and tomorrow for how you want to live your life.
Now, the budgeting program that Nick and I both love is called YNAB, or You Need a Budget, and it’s the program that I recommend all of my clients use. In fact, I think it’s so important that I actually bring Nick into the program when we’re running it live. The next time we run it is probably going to be this fall of 2024.
And Nick has also recorded tutorials for our program too, although it’s definitely in need of an update just because things have changed. The program hasn’t changed that much, but just in terms of how I think about cash flow has changed. However, they’re still valuable and they’re still relevant.
And he’s also available for one-on-one consulting as well. A lot of my clients will work with him for one appointment to really get things up and running and then they’re able to kind of run with it. And so here’s my conversation with Nick True.
And if you are ready to take the plunge to start looking at the data of your spending, then again, the best program is YNAB, which stands for You Need A Budget. And if you use my link, wealthymommd.com/YNAB, you will get a free trial. I think it’s like a 34 day trial. YNAB does have an annual fee, but it’s very reasonable. Again, go to wealthymommd.com/YNAB, Y-N-A-B. All right, here we go.
Bonnie: Hey, Nick, welcome to the show.
Nick: Hey, thanks for having me, Bonnie. I’m excited to be here.
Bonnie: Yeah, I’m so glad we made this happen. I know we had to reschedule a few times, mainly because of my schedule. But I cannot wait for everyone to hear our episode because we’re going to be talking about something that you and I both love. And I think it’s both of our goals to get everyone to love it as much as we do. But before we begin, why don’t you introduce yourself?
Nick: So my name is Nick True. I run a financial coaching business called Mapped Out Money, and I really kind of specialize and focus on helping people in the day to day, like week to week, month to month planning with their money. So very in the weeds, very like nitty gritty how are you thinking about spending today? How are you thinking about spending next week? How does that impact some of your long-term goals, those kinds of things?
And so that’s what I do. I’ve been doing that for, I launched a blog in 2015 and parlayed that into a YouTube channel and blah, blah, blah. And I’ve been doing it for a long time. And so these days it’s myself, my wife works with me and co-hosts podcasts with me and does some YouTube stuff with me. But then she kind of does a lot of the behind the scenes stuff as well. So yeah, that’s a little bit about me.
Bonnie: And Nick and I both love this money program called YNAB.
Nick: Yes.
Bonnie: Which stands for You Need a Budget. And I’ve mentioned it on the show a few times and we’ll talk a bit more about it. This isn’t an episode purely about YNAB, but you’ll understand why we both love it so much.
So I don’t even know how I found you, Nick. I must have just found you on Google.
Nick: I could be misremembering, but my guess is that I think somebody maybe had mentioned – I remember us connecting over email through maybe the FinCon world or through the finance world or something. But yeah, we’ve known each other for a little while now.
Bonnie: At least 2019.
Nick: Yeah. Yeah. For sure.
Bonnie: Yeah, I think you’re right. I think it was through a mutual friend. Was it Travis Hornsby?
Nick: It might have been. Yeah, it might have been Travis.
Bonnie: Do you know Travis?
Nick: Yeah.
Bonnie: Yeah, okay. That’s kind of what stuck in my mind. Okay. So one thing that I’ve actually just been realizing and sort of like, you know, I’ve been teaching money for a long time is in the world I’m in, people focus so much on growing their money investing, which is obviously very important. And I think cash flow or how you spend your money kind of gets pushed off to the side.
Nick: Totally.
Bonnie: Especially with my audience because they’re high income earners. And so they’re not really thinking I have a cash flow issue because the money keeps coming in. But that’s actually something I’ve sort of had a renewed interest in and really like diving in, and for myself too, because that is actually, I don’t know if low hanging fruit is the right term, but I think you can make a huge impact by diving into your cash flow.
And when you think about the big picture of finances, the way I think of it anyway, all this talk about retirement, investing, you know, we all have different notions of what that is, it all comes down to cash flow.
Nick: Totally.
Bonnie: And the spending that you have.
Nick: Yep.
Bonnie: And so when I say cash flow, I also mean budgeting, spending plans, whatever you want to call it. But it’s not sexy, is it, to talk about cash flow?
Nick: No, it’s not. It’s not. People, it’s way more fun to talk about how do we make more money? It’s way more fun to talk about how do I take the money and invest it so it grows into more money. When I come into the conversation, I go, hey, cool, great, I love all that. And also, we should look at how we’re currently managing the money that we have. It’s like, well, I mean, I make plenty. It’s fine. I hear it all the time.
And with your audience in particular, right? Like I’ve worked with a lot of physicians and folks in the medical world over the years. I think the other thing that I notice is they work so hard to get into the position that they’re in and it takes so long.
Like, when you think about graduating high school and then the amount of time it takes before they’re actually making that good income, there can be this sort of, and I’m not even saying it’s unjustified, but there can be this sort of like, I put in the work. I put in the years. I put in the time, and I finally made it. I deserve to spend this. I deserve to live this. I deserve to sort of enjoy it.
And all of a sudden, if you’re not careful, you can ratchet that lifestyle up very, very quickly to where it doesn’t really matter how much money you’re making, you can still go through it.
Bonnie: Yeah. And this is also where I see a lot of the mindset work, because I think it’s so easy to be like, well, more money will fix this problem. And depending on what’s going on, that could be true.
Nick: Yes.
Bonnie: But what I have found, and I’m sure you see, is your income rises and your spending rises at the same time.
Nick: Yes.
Bonnie: Now, we’re talking about personal finances but I’ve been learning a lot more about business finances, way too late in my opinion when it comes to my business, and cash flow is king in a business too.
Nick: Yes, it is.
Bonnie: And people focus a lot on increasing profit margins by making more. There’s so many analogies between personal and business, but all the, I shouldn’t say all but some of the people I follow and have been learning from in terms of business finances say the first thing you should do is reduce expenses.
Nick: Totally, yeah. It’s a bloat thing that just sort of happens, right? Because similar to what can happen on the personal side, but on the business side it can almost even be worse because you start justifying it because you can write it off. And you go like, oh, well, I mean, it’s a write-off.
Have you seen that, did you ever watch Seinfeld much?
Bonnie: I have in the past, yeah.
Nick: There’s a scene where Kramer is trying to get Jerry to write something off and neither of them know what it means. But that’s kind of the bit like Kramer is yelling at Jerry and he’s like, “Jerry, you just write it off.” And he’s like, “What does that even mean?” He’s like, “It doesn’t matter. You don’t have to know what it means, you just do it. The write-off people know what it means.” And it sounds so stupid, but it’s like I hear that, you know?
But I think it’s very tempting because you look at it and you go, well, this could help my business grow.
Bonnie: Everything can help your business grow, that’s the problem.
Nick: And I can write it off, so let’s go. I was thinking, Bonnie, let me do this real quick. I wanted to share a story to maybe frame this up. I like to share this story from time to time because I think it really exemplifies that cash flow can be an issue for a lot of different people.
This was four or five years ago now, and I was running a group program at the time that on that call in particular we had maybe 10 people on the call. And what was interesting about that group is we were focused on the emotional side and sort of the behavior around spending money.
And people on the call didn’t necessarily know what other people on the call, how much money they made or what line of work they were in. But I knew because I had done individual calls or I had seen their budget. So I kind of knew what everybody’s actual dealings were, but the call wasn’t about income. And so other people on the call didn’t know what other people were dealing with.
And we had one lady on the call who I knew her take home income was right around $2,500 a month. Single woman living on $2,500 a month, super tight, but she was making it work. But another woman on the call who her take home income after taxes that hit her bank account was about $75,000 a month. And these two ladies don’t know this about each other.
And the conversation we were having at the time and sort of what we were reminiscing over around this sort of behavior around spending, these two women are talking to each other and totally connecting over it and going, “Oh my gosh, you do that? I do that. We do the same thing. I’ve been there.”
And I’m sort of sitting back laughing to myself because I’m like, this woman makes literally 30 times as much money as this one and they both have the same exact problem. Like they both are talking about the same exact behavior, the same exact stuff.
I think about that story a lot when it comes to people who make higher incomes because they often neglect this area. But to your point, it’s such a key area that if we could make just a couple of tweaks, you can see a massive change.
Bonnie: What I’m hearing from your story here is like it almost doesn’t matter what the number is, there’s just more zeros.
Nick: Totally. That’s all it is. All it is.
Bonnie: Yeah. So, okay. So I’m trying to think how we should make this episode, because I feel like you and I could talk about this stuff for hours, but we don’t have hours. So in your experience, and this is specifically what you do, what are some of the things, do you have like the top three things you wish everyone knew about a spending plan or how we want people to think about it?
Nick: Yeah, good question. So the first thing I would say is the importance of recognizing this and getting the data is one of the most important things to be able to then tweak. So the first thing I would say is like the overwhelming majority of people just have no clue how much they even spend. And that’s normal, right?
But if you think about being a physician, I don’t know anything about what it takes to actually be a doctor, so I’m going to probably butcher this idea, but I think it’ll still make sense hopefully.
If you think about being a doctor and then trying to do your job, but without any data of any kind. So a patient comes in and they say, hey, these are the problems that I have. These are the symptoms I’m having. But you don’t get any blood work and you don’t get to take any scans and you don’t get to check anything. You don’t get to test anything.
All you have to go on is just like how they’re feeling. That’s it. The odds of you being able to successfully diagnose exactly what’s going on drop significantly without data.
Bonnie: Yeah. This is actually a great opening because you just reminded me of this business book, I don’t know if I told you about it. If you don’t know about it, Nick, you have to get it. Maybe you’ve already read it. It’s by Keith Cunningham, do you know who he is? It’s about business finances.
Nick: Got it, okay.
Bonnie: But he actually has a similar story, so I’m going to expound on what you just said.
Nick: Please.
Bonnie: So what you just said is people don’t even know the data, like they don’t know the ins and outs, right?
Nick: Totally.
Bonnie: So he said, not only that, people don’t know how to interpret the numbers.
Nick: Yes.
Bonnie: So he actually has a similar story. It’s like going to the doctor and they order all these labs. So we’re taking it sounds like, okay, that this doctor is actually ordering labs instead of not ordering labs. So let’s just say she took her blood pressure. She ordered cholesterol. She gets everything back. You’re at the follow-up appointment and she’s like, so I got your labs back. And I look at your blood, but like I don’t know what it means, but you look fine. So you must be fine.
Nick: That’s perfect.
Bonnie: And he said that’s how most people run their businesses when it comes to money. Because they get this P&L and the P&L seems nice, but the P&L doesn’t actually tell you how your business is doing. It’s kind of a vanity number. Well, the top line is definitely a vanity number.
But I see that because I think there are people who look at their money to some degree. They’re like, oh, there’s more money coming in than going out, so it must be fine.
Nick: There’s money in the checking, yeah, it’s fine. Yeah, it’s fine. No, I think you’re totally right. So that’s the first thing I would say.
Here’s the second thing that I would say. In my opinion, this is kind of my whole shtick is like, my argument for why I think this is so important is an argument for efficiency. And so the most common objection that I hear is, well, I’ll just make more money. And I’ve literally had people say this to me, they’ll go, “Well, at some point you make enough money, you don’t need to budget. You don’t need to plan.”
Bonnie: Yes, I hear that a lot too.
Nick: And I always find that really interesting because I think about the biggest companies on the planet. Like, imagine if Amazon, Jeff Bezos comes in and says, “You know what? We’re done budgeting. We’re done with bookkeeping and tracking money. We’re done. Marketing departments, you guys just spend whatever. Sales departments, you guys spend whatever. Product departments, you guys spend whatever. No more budgets. No more nothing.”
You recognize intuitively that makes no sense, right? Like you would think actually in the case of a humongous business, they have to budget even more. It’s even more important, right? Because they’re managing more. And so it’s even more important that they manage it well.
And I think on the individual level, the more that you have, the more opportunity there is for waste. And so my argument from an efficiency standpoint is I’m not about cutting back, I’m not about being frugal for the sake of being frugal. I’m about spending as much money as possible on the things that matter the most to you. But in order to do that, you have to know where you are spending money and then what matters the most to you.
And so I think maybe that the other piece I wanted to make sure we get in is like when I look at the data, right? So we talked about putting the data and getting through our tracking system. In terms of interpreting the data, the next thing that I’m looking at is I’m going to somebody’s sort of longer term vision and longer term values and saying, “Hey, what do you care about? What matters to you? What do you want to do with your life?”
And then are we using money in a way that’s going to help us do those things? And it’s not about, like I said, spending less, it’s about spending more, but on the things that matter the most to you. And I think that’s sort of the mindset shift that I try really hard to get people to see is like the spending plan is not about cutting back.
The spending plan is about going, hey, what are the things that, not what your friends at the hospital think is important. Not what would impress the nursing staff. Not what would impress your client base. Not what would impress your parents. But what does Bonnie care about? And then how do we shove as much money as possible into the things that Bonnie cares about? Like that’s the thing.
Bonnie: No, I love that. And it’s such a great way to reframe, because again, like you said, people think about cash flow, budgeting, spending plans, they’re thinking, oh, Nick or Bonnie is going to tell me I can’t spend money on that. That’s like the most common thing I hear. They’re like, I’m afraid you’re going to tell me I can’t spend any money.
I’m like, no, it’s kind of the opposite. We want to make sure you’re spending money on the things that matter to you. And to take it a step even further, and you kind of touched on this too, is like, well, first we need to think about like, well, what are your goals? And when I say goals, I don’t necessarily mean like I want $10 million in the bank because I feel like that’s kind of like old school money goals at this point, you know, like how much money do you want in retirement?
It’s like, okay, that’s nice, but what is the point of having that money? It’s like, it’s to live a certain way and at different stages, because we all have different stages. And even me, I feel like I have to unprogram my brain from the traditional one career to retirement paradigm. That’s kind of, I think a lot of people are noticing that that’s just not true.
We’re sort of in this like in-between generation where that was true for our parents and it’s less true for the younger folks. It’s a lot of figuring out like, what do you actually want your life to look like? And most of us haven’t answered that question since we were like five years old, apparently.
And it’s something I’m sure, Nick, you and I are probably similar in that we’re on a regular basis asking ourselves what that looks like. And that changes faster than I care to admit. What’s important to me last year is less important to me this year. And more and more, it’s less about things, it’s more about freedom and travel. And so what I realized is I actually don’t need as much money as I thought I did, especially with credit card points, but that’s a whole other discussion.
Getting back to what we were talking about. Okay.
Nick: So here’s an example to try and make something a little more concrete. I’ll tell another brief story, right? So two things here that come to mind. Number one, you and I, we both are very into this spending plan thing. But as we discovered a month or two ago when I was hosting a workshop, there are things that you and I like that are very different in terms of the way that we spend money.
Bonnie: Yeah.
Nick: I can’t tell you the last time I got on an airplane. I can’t tell you the last time that I –
Bonnie: It was like yesterday for me.
Nick: That I spent the night at a hotel. Like those things are just not important to me. I spend a lot of money on my pets. I spend a lot of money on travel in our Airstream travel trailer. I spend a lot of money on those types of like road tripping travel. And I don’t fly because I want to take my dogs with me. And we buy them the best pet food. We buy them super expensive pet insurance. We buy them super duper, whatever grooming. Like we do the whole thing. And that’s where we spend a lot of our money.
Bonnie: Yeah.
Nick: And we travel with them and that’s our thing.
One other example that came to mind when you were talking about retirement. I was talking with a client a couple of months ago and I thought this was really a beautiful way that he was talking about why he wanted to build his wealth.
So we were talking about long-term and I was really sort of pushing him to think down the road, 10, 15, 20 years. And his oldest kid is 14 and then he’s got 14 and then he’s got 10 and then like six or seven. And he said, you know, one of the reasons that I would like to have a chunk of wealth is I have not been able to go and visit my family, my parents, as much as they would like me to, because I have kids, they’re busy, I’m working, dah, dah, dah, dah, dah. My parents are retired and they live in two different places, right? His parents live in Jersey, they live in Florida.
And he was going and saying, you know, we just logistically, it’s very difficult for our family to like go up there as often as my parents would like us to. My parents are also not in a position to have enough money to fly and come see us as much as they would like to. He said, “so what I’m thinking about now is that I would like to have wealth. One of the reasons is I don’t want to put the pressure on my kids to come and visit us. But I want to make sure that we have enough money that we can afford to fly them or we can just go visit them when they’re adults and they have kids of their own.”
And I thought that was such a beautiful long-term way of a very concrete thing to go, here’s something that is not ideal about my relationship with my parents as an adult that I would like to shift. And that if we had more money and if we were thoughtful about our investments now, we can put ourselves in a position where that’s not even an issue down the road. I thought that was a really cool way of thinking about the reason that we’re doing all of this work.
Bonnie: Yeah, the why.
Nick: Yes.
Bonnie: Yeah. No, I love that. And I think getting as concrete as that is really, really compelling. Because the whole like, well, I’d like to be able to retire from my job right now. Like for some people, that is really compelling, especially there’s definitely a growing number of physicians who are really unhappy with medicine. So that’s one of the reasons.
But that’s more about what I call reducing pain versus like –
Nick: What you can achieve.
Bonnie: Yeah, exactly. And when I try to ask that of my clients, we just haven’t asked that question or we haven’t just given ourselves the freedom to even ask about that stuff.
So what are some of your longer term things that you have in mind as you’re carrying out your spending plan?
Nick: So for us, a couple of things come to mind that are driving why we’re so intense about things today. So number one, probably the thing that is most pressing is within the next couple of years, we would like to buy a beach condo down in South Alabama on the coast. It’s an area that we’ve always, both my family and my wife’s family have always grown up going to.
When you live in Tennessee, that’s sort of like the place that everybody goes and vacations. So it’s an area we’re familiar with and love. And we would like to own a beach condo there. It’s one of those things, too, where like the beach condo prices on that beach make no sense from an investment standpoint.
Meaning if I was just doing it for the purposes of investing, it doesn’t make any sense to do that. But we want it for the ancillary benefits. And then, yeah, if it makes money, you know, a little bit to just help cover the mortgage, fine. So that’s one sort of shorter, nearer term.
The next that comes to mind is we want to be able to buy a house that has the size, if you will, to do all of the things that we care deeply about. So, for example, we’re planning to adopt kids over the next probably three to five years. And that’s a whole other thing in terms of money and expenses.
Bonnie: Oh, yeah, yeah. I’ve heard.
Nick: That’s another big reason. But what we envision sort of our life looking like in a few years is having a house that is large enough to have an art studio for my wife to have a kiln. If you’re not familiar with what that is, my wife’s into pottery and a kiln is like the fiery oven, basically, that you bake your pottery and more or less. That’s like the most slang way to say it, but that’s what it is.
We want to have a garage that can have a really nice workout gym that we care about. We want to be able to work from home and we also want to be able to homeschool kids. All of that requires a decent amount of space. We also would love to do that, we’re planning on moving in the next couple of years and we are looking to do that in a very small coastal beach town. We would like to be in a walkable area.
And it’s like all of those things around the home and the lifestyle and the way that we’re trying to build our life, all that requires money.
Bonnie: Pretty much everything requires money.
Nick: It does. It does.
Bonnie: It’s like, have you noticed?
Nick: I don’t know if you know this, but it requires money.
Bonnie: Yeah.
Nick: But the point I’m making is like when I think about why we are so focused on, obviously making more, we are focused on increasing our income, but also managing that well, is like when I close my eyes and I picture our life a few years from now, that’s what I see. I see Hannah with a detached art studio in the back with lots of windows that allows her to paint and do her pottery and have this very indoor/outdoor lifestyle there.
I see us having a podcast and recording studio at our house so that I’m not having to drive anywhere because we like the sort of cohesiveness of that. I see kids that we have, you know, running around doing their thing. And potentially depending on what sort of we feel led to do, some of those kids may end up needing more specific help in terms of medical needs and those kinds of things. And so that’s another huge reason that we’re trying to make sure that we are budgeting well now so that we have wealth to be able to do that and take care of those needs when the time comes.
And so those are some of the things that sort of show up in our life vision. And we sort of have a vision doc that we use and update regularly and those are the things that are on it right now.
Bonnie: Because I find that if that isn’t solid, the motivation to actually work on money is very low. Have you found that too?
Nick: All the time. Yeah, it’s really funny. So in marketing, I don’t know if you’ve heard this phrase, sell them sizzle, feed them steak. People typically buy products or programs or whatever for the sizzle, for like the sexy thing that sounds cool.
But then sometimes, this is not always the case, but sometimes we have to recognize that the sizzle is not actually the thing that’s going to help you. It is the hearty food, if you will, right? And so we’re going to sell you the sizzle, but we’re going to actually feed you what the thing is.
And so I think about that a lot with my programs and what I’m doing when I coach people. The only way that I see this stuff work is if you lock into a compelling vision for your future that you care deeply about achieving. If you don’t do that, then you’re not going to want to keep tracking your money because it’s a pain.
You’re not going to want to keep looking at it and trying to change it and plan it and tweak it and sometimes, yes, cut back in certain areas so that you can do more over here, right? You’re not going to want to do any of that. It really is like the most critical piece of what we do.
Bonnie: In fact, I was really noticing how critical it is for me to be very effective in helping my clients do that, you know? So I don’t know if you know, but I started doing a conference and we had our first one earlier this year and so we’re having the next one in February of 2025. We’re going to start with laying out the vision and making sure they don’t leave without having one.
I think it’s so easy to be like, yeah, yeah, we know that’s important, but tell me how to grow my money.
Nick: Yep, 100%. It’s really interesting too. Like, I think it’s one of those things where I’ve found so often when I ask people, especially if they’re business owners or they have some level of control over their income, right? So maybe they’re a physician, but they own their own practice or they’re a partner or whatever. And so they have some level of it’s not just like they’re a W-2, they have some control and see a path to growing their income.
And I’ll ask questions like, well, how much money do you want to make? You know, eventually what’s kind of your goal that you want to get to? And do you want to know that in all the years I’ve asked that question, no one has ever given me a number that isn’t round. Meaning like it’s always, well, I want to make 400,000, I want to make 500,000, I want to make 700,000, I want to make a million, I want to make 200,000.
Like no one ever says, for me, it would really be nice if I could make 335,800 bucks. If they gave me a specific number, that would tell me that they’ve thought about what that money will do for them, how it will impact their life and what matters to them and that that’s the number that they calculated they need to live the life that they dream of.
But no one gives me that number, people give me round numbers. Why? Because it’s an ego thing. It sounds good. It’s, ooh, I made this much money. My parents will be impressed if I make this much money. Or so-and-so made that much money, so I want to. It’s always a round number, right? And I just laugh so hard at that because I go like, you can tell that number doesn’t mean anything to you other than it just sounds good or looks good on paper.
Whereas if you, and Hannah and I literally, we did this. It’s so funny, we literally did this. We do this once a quarter where we go over our vision and stuff. But we just went in the weeds on this earlier this week because we’re talking about some big decisions we have coming up.
Basically, I started and said, if we want to have X amount of dollars per month for kids, we want to be able to buy a beach condo like this size and keep it, and we want to be able to buy a house in this location around this size, here’s what they cost. And we want to be able to do all these things. And I put a little spreadsheet together.
I figured out what our take-home number needs to be. And then, because I know my business margins, I can then go, all right, cool. So here’s what the business needs to make in order for us to take this home, in order for us to have the beach condo, the house, the kids, dah, dah, dah. And so now we have like a business revenue number that actually means something.
Bonnie: Yeah.
Nick: Because I know this is the revenue we’re going for. And if we hit that, here’s what our life looks like.
Bonnie: I just want to stop you right there, just illustrating how specific it’s like, okay, I have this very specific vision. And he has actually taken the time to sit down to calculate how much, you know, the actual numbers.
Nick: Yes.
Bonnie: And then because you have a business, and I do too, reverse engineer. That’s your primary source of income, right?
Nick: Yep.
Bonnie: I haven’t done that in a while. And now that we’re moving, there’s some new numbers and data points I need to enter now. How does investing come in for you? Like, how do you think about that in respect to your current cash flow and future cash flow?
Nick: So this has changed a little bit over the years. A couple of years ago I would have told you that we were primarily focused on real estate investing. It’s not that I no longer believe in real estate investing as a thing. Like I think tons of people, it makes good sense for them to do and it’s awesome. Since we bought a property and managed it and renovated it and dah, dah, dah, dah, for me, I have found that my time, energy, and effort is best put by simply growing my main business and then trying to invest as passively as possible. And the way that we’re going about –
Bonnie: Are we the same person? I’ve come to the same conclusion too.
Nick: That does not surprise me. I massively underestimated the amount of work associated with it and the amount of focus it took away from my main business.
Bonnie: Well, it’s also because you have a business too.
Nick: Totally, yes.
Bonnie: I think if someone doesn’t have a business as well.
Nick: It’s completely different, yes.
Bonnie: Yeah, I agree.
Nick: So that means for us, the overwhelming majority of what we’re doing investing-wise is focused on maxing out 401ks, IRA, traditional in the market index fund long-term, set it and forget it type things. That being said, in terms of how we think about it, I also have done the math to figure out, because I really, really like what I do, I’m not super interested in trying to retire early. I’m interested in building the business in a way that I really enjoy and can run it for a long, long time.
And so I’m not trying to invest aggressively to hit some sort of FI number by age 40, whatever. That’s not my thing. And so I know exactly how much money that we need to be investing today in order to have the amount of wealth that I would like to have at 60. And I’ve done that math to know, well, if we want our lifestyle to look like this, we need this much money by 60. And so we need to invest this much money today.
And so that’s built into our spending plan. Meaning when I’m talking about these things like the beach and adoption and all these things, investing is also built in there in terms of taking the money out that we pay ourselves and then throwing it into the market and letting it grow sort of passively.
And I sort of treat that, in my mind, as almost like a table stakes or a bare minimum of going, it’s very important to me to have this much wealth at age 60. And so I need to make sure that the first thing we’re doing is investing this and all these other pieces come after that. That’s how we do it.
Bonnie: I’m guessing that people will be like, okay, this sounds fantastic, but how do I actually start? Because I can almost hear people like, okay, this sounds great. I’m kind of on board, but what are the steps? It can feel overwhelming, especially if a lot of my clients are fearful that once they, actually, a lot of them are just afraid to even look at what’s going on with their money.
Nick: Totally, yeah.
Bonnie: They’re just like, you know, out of sight, out of mind. You know, they don’t have collections people showing up at their door, so it must be fine type of thing, you know?
Nick: They didn’t get into their line of work because they wanted to budget.
Bonnie: Yeah. So what happens when you look at your numbers and you realize that you are nowhere near where you’d like to be? Because I’m guessing a lot of people might be in that situation and it can feel not so great to be in that position.
Nick: This is not the fun part. But the first thing that I always say is, like Mick Jagger says in his song, you can’t always get what you want, honey. And I start there because I have to make sure people recognize that in life, there are trade-offs. There are 24 hours in a day. There are only so many years that you’re going to live. And however much money you make, and I hope it’s a ton, but however much money you make, it’s a finite number, it could be counted.
And at the end of your life, we could say, Bonnie made this many dollars and here’s how Bonnie spent them. We could look and we could count it. It is a finite number, it’s not infinite.
And so even when we look back, I hope that we look back and go, wow, Bonnie, look at all these things that Bonnie did with her money, it’s so cool. But we probably would still be able to look back and go, ooh, she kind of wasted money there. She kind of spent money on that that really probably wasn’t her highest value and priority. And I think that if she had it to do over again, she might shift that particular thing so that she could have done more of this.
And so the first thing that we’re doing is just like, I’m trying to get someone to understand that unfortunately we live in a world where there are trade-offs. You do not get everything you want all the time. And so we have to sort of recognize that and embrace it and then work within the constraints. So that’s the first thing, in my opinion.
The second, then we go, okay, well, in light of this, what are the most important things to us? And now we’re back at vision, right? Now we’re back at like big rocks. Now we’re back at what are the things that matter the most to you? And so I end up having a lot of hard conversations with clients about some of their biggest expenses.
This is not always the case, but there’s many times where I’m having hard conversations where I’m saying like, okay, you say that you want to do all of these things, but you have all of these fixed things in your life that just completely drain your finances out of the gate before we can even get to any of this stuff over here. We need to look at those.
And so we have hard conversations about moving sometimes. We have hard conversations about getting rid of vehicles. We have hard conversations about things like, do you actually need to be sending your kid to 18 summer camps or is four summer camps fine, right? Like those types of situations where –
Bonnie: Well, they’re big expenses. I mean, the mortgage is probably the number one.
Nick: They’re huge.
Bonnie: Have you had clients who have decided to move?
Nick: Yeah, I’ve personally helped at least seven people leave California at this point.
Bonnie: Well, yeah, it’s such an expensive state. Yeah.
Nick: It’s so expensive. So expensive. I had a widowed woman who, this was very difficult, but a widowed woman who finally decided to sell the house that her husband built with his bare hands after like 50 years. And it was very, very hard for her. But we came to recognize the fact that we had to thank that house for that season and that time in her life, and then recognize that that house no longer served its purpose in her new season.
Bonnie: Yeah.
Nick: And this idea of like, we’re not saying it was a mistake. Like it was a beautiful home that your husband literally built. And then you guys raised a wonderful family. And now that home no longer makes sense for you. And so thank that season for what it was. Remember it, look back on it with fondness. And also now be grateful that the home, we can sell it and it provides for this next season.
A lot of it is mindset around training people to recognize that regret can be, I like the phrase like regret can be a road sign. So it’s one of those things where we can channel this idea of going like, hey, it’s not about regretting it. It’s about going, this no longer makes good sense for the person that I’m becoming and the vision that we’re creating.
But yeah, back to your question concretely. If you’re looking at your numbers and you’re going, holy crap, I do not make enough money to make this happen. What do you do? I think it starts with recognizing that trade-offs are part of the game. And then it starts with going, well, what are the things that matter the most to me?
And then recognizing that you do have some agency, you have control. You can take ownership over that and you can make that change.
Bonnie: Yes, I think that’s huge because I think it’s so easy to feel like you don’t have agency over how your money goes. And obviously you and I both know, the more you think that, the more that’s true for you, right? And I have to think about future Bonnie.
Nick: Yes.
Bonnie: What does she want? And what can I do now so that she is set up for the life that she wants and what I want for her, right? And so the first step is getting the data, right? And that’s what I teach in my program. And so this is where we talk about our favorite program for gathering data. And so it’s called YNAB or You Need a Budget. I’ve been using it since, actually my friend told me about it when I was still a resident, so it must’ve been 2014. And so I was using the desktop version. Were you using it back then too?
Nick: Oh yeah. It was, well, 2015 for me. So a little bit after you.
Bonnie: Yeah, the desktop.
Nick: Yes.
Bonnie: Yeah. And then it finally caught up with the modern age and went web-based and sync. Back then it didn’t sync. You had to, well, the good news is back then I didn’t really have a lot of transactions. It was just me and I was constrained by resident salary. Now it’s like the volume of transactions is so high.
And I think people are surprised, again, going back to what we said before, like, oh, at some point you can stop doing this. And I don’t see, in fact, I actually find that I look at it more often than when I had less money.
Nick: Yeah.
Bonnie: I look at my YNAB once a week, sometimes more, more now because of all this moving stuff. And we’re hemorrhaging cash right now. Moves are very expensive.
Nick: But you also, how old are your kids?
Bonnie: I have a six and a half year old. And then I have a stepson who’s 17.
Nick: Yeah. So like, this is what I would say too, you’re sort of like in the most expensive season of your life, which is like the kids, the 17-year-old and then the six-and-a-half-year-old are getting into activities and doing stuff and money is just flying everywhere.
Bonnie: Yeah, and then with the move it’s just flying everywhere. We are getting reimbursed for a significant thing because the movers are like $18,000. I’m like, Jesus.
Nick: Oh my Gosh.
Bonnie: Yeah. But our relocation allowance is more than that. But still it’s just like, it’s just insane how much it is. And I tell Matt like, I don’t want to move again anytime soon.
Nick: Yeah. Yeah, it’s a huge shift. Huge.
Bonnie: Yeah, it’s definitely messing up our spending plan right now. I’ll tell you that. But this is also part of it, doesn’t YNAB say you’ve got to roll with the punches.
Nick: Got to roll with the punches. That’s how life is.
Bonnie: Things can happen and you have to be flexible.
Okay. So tell me why you love YNAB. It’s probably the same reasons I do. And why we think it’s the best program and getting everyone on board, because there is a bit of a learning curve, right?
Nick: There is a learning curve. I have built a reputation around YNAB, but I try to keep myself honest and so like every year I try to take time to test out new budgeting apps, see what’s coming on the market, see if there’s anything out there that I like better and really do an honest look at it.
YNAB does some things, sure, that I think could be improved upon. Sure, absolutely. But overwhelmingly it does a couple of things that I think are just so fundamentally key to actually creating behavior change and helping people really, really make progress towards their goals.
And honestly, probably the number one thing that I think it does that most other tools don’t do, which I think is so goofy, is YNAB doesn’t let you budget money you don’t have.
Bonnie: And people are pissed when that happens.
Nick: They’re so mad. They’re so mad. They’re like, I’m going to get paid next week, why can’t I just put that money in here? Bonnie, it’s funny, have you ever counted calories or macros?
Bonnie: Oh yeah.
Nick: Okay.
Bonnie: Not anymore, thankfully.
Nick: I was telling somebody this the other day, they were personal training in the fitness space and I was trying to connect this idea of like YNAB doesn’t let you budget money you don’t have. You have to physically have the money in order to use it. And it’s the key thing that creates behavior change.
And so here’s what I said. I said, okay, let’s pretend that I’m counting macros and that I can eat 2000 calories a day. That’s my eating plan, 2000 a day. Well, next week I’m going to get 14,000 calories. Why don’t I just go ahead and eat some of those today? Why don’t I just go ahead and eat 10,000 of those today? I’m going to get them next week.
And you immediately go like, well, hold up. That doesn’t make sense. You’re going to need calories next week, unless you’re planning on fasting for the week. And also, I don’t think eating 10,000 calories in a single day is good for your health. And you go like, yes, but that’s what people do with money. They’re like, well, I’m going to get paid next Friday, why can’t I just go ahead and use it now?
Bonnie: Just over broke.
Nick: Just over broke, I see it all the time. So if I had a selling point for YNAB, it is that forcing you to come to grips with your actual cash position that creates that sort of trigger that we have to have.
Bonnie: Yeah. And we should probably say what YNAB means because sometimes I say it and people are like, what are you saying? You Need a Budget.
Nick: You Need a Budget, yes.
Bonnie: An acronym for You Need a Budget, yeah. Every client that does get on board with it and get it working there, when they hit that sweet spot, they’re like, oh, now I get it. And then they’re like, whoa, it could be in a good or a bad way. Like, whoa, like I can’t believe all this money is going out on things that I really don’t give a crap about.
Nick: Yep.
Bonnie: It’s just, it’s too easy to buy things right now.
Nick: It’s so easy. So easy. Well, on Amazon, you’re just like one touch, one, you know, I mean, it’s ridiculous.
Bonnie: One click.
Nick: One click.
Bonnie: They have that one click purchase feature.
Nick: But yeah, so get the data. That’s the starting point, right? And I tell people too, the other thing I would say the starting point is, this is very hard to do, but try very hard to bring no shame, no judgment, no anything. We want to almost treat ourselves like we’re a scientist in a lab that’s just observing the data as if it’s not yours.
Bonnie: Yeah.
Nick: And so for the first month or two, I’d always tell people, don’t change a thing. Just track it and don’t really think about like, oh, that’s too much or that’s too little. Just track it. Start collecting the data, we’ll worry about analyzing it later.
Bonnie: That’s what I teach too. When we first look at spending, it’s like you’re just collecting data. And even that phrasing, it’s like we’re neutral. It’s like we’re not making judgments. We’re just collecting data. But this is obviously where a lot of like, oh, ooh, or shame. Like, I don’t want to, I don’t really want to know. Like, I know I’m spending way too much on Amazon. And they’re like, holy cow when they see that number. There’s a lot of self-judgment. But again, as you were saying, everyone that I work with is in the same boat to some degree. We all have, I’m sure you have clients who are the extreme opposite and they’re afraid to spend money.
Nick: Yes, 100%.
Bonnie: And that’s a different type. It sounds like maybe a “good” problem, but it’s a bad problem because they’re not enjoying it.
Nick: Totally.
Bonnie: What’s the point of having money if you can’t enjoy it, you know?
Nick: It’s a huge problem.
Bonnie: This could become a two-hour episode easily, but let’s just quickly walk through. Okay, so number one is data collection. And then what do you do next?
Nick: The next thing that I do in my process is, well, I typically start with like, step zero is almost like I do a little bitty why statement framework thing, right? And so we don’t go deep into the vision at the beginning for us, but we start with like, why are you here? What is that? And we come up with a little framework. And I use the framework, “I want to manage my money well so that blank, if I don’t blank.”
So we get that. Then we go into data collection. Then while they’re sort of running the data collection in the background those first couple of months, no judgment, no changes, just data, then we shift gears and that’s where we go deep into the vision piece. And that’s where my job comes a little bit more life coaching because I’m having them look at what’s your vision, what’s your values?
We create a vision plan that has the next few years laid out with the things that matter the most to you and some of the bullet points of the high-level stuff that you want to accomplish. And then at the bottom we have sort of a future dream section, which is kind of like a bucket list in that it’s the things that you want to make sure that happen before you die. And we get very clear on that.
The third step then is now if we’ve got a couple months of data and we have the vision document, I like to say we put our money where our mouth is. If we know where your money’s going and then with your mouth you tell me this is important to me, my only job is going, all right, are you putting your money where your mouth is? Are you using your money to do those things? And almost always we go, no.
And then we go, great, so let’s look at the vision and let’s tease out the items on here that are financially related, right? The travel you want to do, the things you want to do for your kids, the places you want to go, the stuff you want to buy, the whatever. The things that are money related.
Or in some ways, the things where we could use money to improve them, right? So if you have health related goals, great, can we hire somebody? Can we hire a coach? Can we hire a trainer? Can we whatever. And we start creating new categories for them. And we start working those into the budget.
And then that’s almost always when we realize, now I really don’t make enough money to do these things. And that’s where we have the hard conversation about trade-offs and whether or not we do need to focus on increasing income or if we just need to focus on reallocating the income we have.
Bonnie: Yeah, or a combo of both, right?
Nick: Yes. And that’s often what it is.
Bonnie: Yeah. I mean, that’s, I think, ideal if you can do a little bit of both.
Nick: Totally.
Bonnie: Yeah. So I guess the question is, well, how do I get started?
Nick: Yeah.
Bonnie: And what’s your answer to that?
Nick: I was going to say the first thing is to start tracking your money, but it’s almost like a prerequisite for that. And I know this sounds like me and Bonnie are just a broken record today, y’all, but the prerequisite is almost like you just have to decide that this is so important that you’re going to do it.
And so that means you have to have a strong reason for why you’re going to actually start collecting the data and start paying attention and start trying to manage your money better. And so the prerequisite is you need to have a very, very strong, compelling why. And then the first step is to start tracking the data.
Bonnie: So, yeah, first it’s like deciding that you’re going to do something about it.
Nick: Yeah.
Bonnie: Because what I see with higher income earning, which is my clientele, is it’s so easy to delay because there isn’t like an emergency.
Nick: Yeah. This could just be my clients, my client base for who often hires me and stuff. This is not always the case, but I would say 80% of the time, the overwhelming majority of my clients, something has just happened or something is about to happen that has finally created enough urgency that they’re like, all right, I’m going to make a change.
And so it’s like they just got married or they just got divorced. They just had a kid. They just changed jobs. They just moved. They’re about to retire. They’re about to move. They’re about to change jobs. Like it’s some major life event has occurred or is about to occur, and that’s the thing that actually pushes them over the edge to go, all right, I need to get serious about this.
And so to your point, the higher your income, the less urgent things can feel.
Bonnie: Yeah. I know that’s kind of where I’m at, like how do we convince, and when I say convince I don’t mean convince them to pay me money. But it’s like, how do I convince them to work on it now when you don’t have an urgency?
Nick: The urgent thing, yeah.
Bonnie: You know, how do I convince the person who actually feels great, I’m talking about physical health wise, to work on it now versus waiting until they get like a cancer diagnosis, for example.
Nick: Yeah. It’s interesting. It almost goes back to like, do you learn by having to go through things yourself or can you learn from others’ mistakes, right?
One of the things that I’m really so grateful that for some reason just clicked with me early was when I decided I didn’t want to pursue the career path that I went to college for. So I have a degree in mechanical engineering. And in particular with that industry, so I looked down the road and I was able to see other guys who were 15, 20, 25 years ahead of me. And I looked at their lives and I realized, I don’t want my life to look like that.
And that industry in particular, it was like constant travel. I was constantly getting called out for clients to fly across the country and work long weekends and work holiday weekends and be away and all these things. And I knew even back then, I was watching the guys ahead of me and watching the stuff that they were going through and watching the divorces that were happening and watching all these things and going like, I don’t want that life, and so I need to figure something else out.
And that’s when I ultimately decided I needed to change either industries or change fields completely. But to your point, maybe managing your money well doesn’t feel urgent to you right now, but can you look at someone in your life, either a coworker or a family member or parents or an aunt or an uncle who’s maybe 5, 10, 15 years older than you who hasn’t managed money well and then now is reaping the consequences of that?
Bonnie: I think everyone knows someone like that.
Nick: Yeah. Can you look at them and go like, all right, it doesn’t feel urgent to me right now, but I’m looking at them and not being hateful, just saying, I just don’t want that life.
Bonnie: I think it’s, actually, I don’t know what people think about me, but I’m just presuming people probably think I have a shitload of money and I probably have a lot less money than people think, but I’m able to do the things I’m doing just because of the way I’ve, a combination of managing money and choices I’ve made about how I want to live.
Nick: Yes.
Bonnie: Like I don’t have a huge house. We also love renting. I think at some point we will want to buy and that’s something I’m gonna have to really think about. I don’t think buying a home in Florida is the best idea with the weather.
Nick: Weather and home insurance down there is very expensive.
Bonnie: Exactly, yeah. So I’m just like, I kind of like renting because the place that we found that we signed a lease for is bigger, it’s nicer, and it’s cheaper because it’s Florida. Because where I live right now is very expensive, I live right outside of New York City, Northern New Jersey, which is not California expensive, but it’s not far. Also making sure we’re not gonna just suddenly increase, fill that up with something. Although we did just buy a new car.
Nick: You all have a lot of life changes right now, and it’s a good time for you to get reacquainted and reconnected with your vision because what you think life’s gonna be like in Florida versus what it’s actually going to be like are probably somewhat different.
Bonnie: Yeah.
Nick: And so you can create a vision now, but then it’s going to be good to reassess that vision in three to six months once you get down there and are like, all right, well, what does life actually look like now? And what does that next season look like?
Bonnie: All right, Nick, this has been great, not just for me, but I’m sure for everyone listening. How can people find you?
Nick: Yeah, so the easiest thing is probably just go to YouTube and search Nick True in the search bar. And depending on when this comes out, we will probably have some new YNAB tutorials coming out here shortly as well. So if you’re looking to get started with tracking the data, go to YouTube and search for Nick True and you’ll find it.
Bonnie: Awesome, thank you so much for your time, Nick.
Nick: Yeah, thanks for having me.
Hey there, thanks so much for tuning in. If you loved what you heard, be sure to subscribe so you don’t miss an episode. And if you’re listening to this on Apple Podcasts, I’d love for you to leave a review. Reviews tell Apple that this podcast is, well, awesome. And it will help women find this podcast so that they too can live a wealthy life. And finally, you can learn more about me and what I do at wealthymommd.com. See you next week.
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210: Navigating Long-Term Care Insurance with Wallis Tsai, CEO of AboveBoard Financial
With many of us living longer lives, often with chronic illnesses, understanding long-term care is more crucial than ever. Wallis Tsai, the founder and CEO of AboveBoard Financial, is driven by a passion for ethical insurance practices. She transitioned from a high-powered role at Goldman Sachs to start her own independent insurance brokerage. Her mission is to provide transparent, informed guidance on long-term care insurance, a topic that can often feel overwhelming and confusing.
Wallis unpacks the evolution of the long-term care insurance industry, highlighting its tumultuous past and significant changes. She breaks down the various types of policies available today, from traditional long-term care plans to innovative hybrid policies that combine life insurance with long-term care benefits. Wallis shares her insights on industry challenges and pitfalls, like sudden premium hikes, and offers practical advice on making informed decisions.
Tune in this week to learn about the critical role long-term care insurance can play in your financial security and peace of mind. Wallis explains how AboveBoard Financial is setting a new standard with their transparent and client-focused approach. We also discuss practical tools, like cost analysis, to help you understand the expenses associated with long-term care in different regions.
Learn more about Money for Women Physicians, an exclusive money coaching program to get your money and mindset working for you.
What You'll Learn from this Episode:
- The evolution of the long-term care insurance industry and its significant changes over the years.
- The differences between traditional long-term care plans and innovative hybrid policies.
- Common challenges and pitfalls in the long-term care insurance industry.
- Practical advice on when and how to start considering long-term care insurance.
- Tools and tips for understanding the costs associated with long-term care in different regions and making informed decisions.
Listen to the Full Episode:
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- AboveBoard Financial | Email
- Outlive: The Science and Art of Longevity by Peter Attia
Welcome to The Wealthy Mom MD Podcast, a podcast for women physicians who want to learn how to live a wealthy life. In this podcast you will learn how to make money work for you, how you can have more of it, and learn the tools to empower you to live a life on purpose. Get ready to up-level your money and your life. I’m your host, Dr. Bonnie Koo.
Hey everyone, welcome to another episode. So today I have a special guest. I have Wallis Tsai and I happen to be, I’m trying to think how did I meet her? We were introduced by a mutual friend and I have been looking for someone to educate me and educate you about long-term care insurance.
People ask me from time to time and I don’t really have a great answer. And so this conversation is really focused on that. What is it? Why you should consider it. What are the types of costs of long-term care and how, frankly, a lot of us really do need to think about it since most of us are living longer and many of us will likely have some sort of chronic condition, unfortunately.
Speaking of that, I am reading the book Outlive by Peter Attia. I’m not quite sure how to pronounce his last name. You may have heard of the book, Outlive. I guess you could say it’s a book about longevity, but it’s more about how can we feel and stay healthy for longer? Because right now the statistics aren’t so great about our later years because most of us will just have way less decreased function as a result of things like, you know, losing muscle mass every year after the age of 30 and things like that.
And so I’ve been reading that book. I’ve been learning a lot and I’m ready to implement a lot of the things so that we can try to mitigate some of those risks and live healthier for longer.
Now as a side note, I’m really hoping, and if you know of a book or some resource, go ahead and email me at [email protected]. But as much as I love that Peter wrote this really, really great book, I really wish there was something more specific to women because our bodies are different, right? We all know that. And unfortunately, a lot of the data out there is male specific because that’s just what’s been studied. And so I would love to see more data on our life as women because there’s things like hormones and things like that.
And so I’m actually learning about that myself as I am perimenopausal, if not almost there. That’s a whole nother conversation. And so I’ve had to educate myself because basically things have changed a lot since I was in medical school. Basically I was, you know, in that era of HRT is bad, it can cause cancer. And that study has since been, not so much debunked, but basically how crappy that study was and how it basically ruined a whole generation of women in that age range where they really could have benefited from HRT.
Anywho, this conversation with Wallis is something you definitely want to listen to for yourself to learn more about it. And to, again, it’s all about learning what options there are in terms of stewarding your money and thinking about your financial future. All right. Here’s the conversation.
Bonnie: Welcome to the show, Wallis.
Wallis: Thank you.
Bonnie: I’m so excited that you’re here. Before we get started, why don’t you introduce yourself?
Wallis: Sure. My name is Wallis Tsai and I’m the founder and CEO of AboveBoard Financial. We are an independent insurance brokerage that takes a unique ethical and tech enabled approach to life and disability and long-term care insurance.
And it really came out of my own experience working at Goldman Sachs for over 10 years covering financial services companies and seeing just how often those industries were not delivering the best outcomes for consumers, and wanting to build something that was a better way of making these industries do the right thing for people.
Bonnie: Tell us what’s different about you, because obviously there’s a lot of insurance companies that sell insurance. So what would you say is sort of unique about what you guys provide?
Wallis: Yeah. So we have a uniquely analytical and also ethical approach to the way that we work for our customers. And that comes through in knowing our stuff and being transparent with clients about what the reality of these products are. Because what I’d found, even before I started AboveBoard, was that insurance can be incredibly powerful as a force for good and it can provide critical support in life’s worst moments, right? When you lose an adult prematurely or severe illness strikes and somebody can’t work, right? Insurance can be incredibly helpful.
But I noticed that it was also the scene of some of the biggest, worst financial mistakes that I would see as well. And so at AboveBoard, we wanted to be laser focused on getting it right, like really knowing our stuff, and then also executing with efficiency and delivering a delightful experience to the customer that feels empowering. When they’re done, they feel like they got the best thing in the market for them and they really did something they can be proud of.
And my co-founder is a software developer, and so we’ve basically built software to support the delivery of this totally differentiated experience in a way that’s efficient. And so we can help people who are looking for a million dollars in a 20 year term, we can help people who are doing sophisticated estate planning for tens of millions of dollars. And so we have a really unique client experience that’s underpinned by this desire to give smart, ethical advice.
Bonnie: You were saying with your experience when you worked in Goldman Sachs in the financial industry, like what were sort of the things you saw that you didn’t like?
Wallis: Yeah, so a lot of colleagues would come to me because they knew that I was a financial services sector expert. And they would say things like, hey, like I had this meeting with this insurance agent. They were saying I should do this, what do you think of it? Or they would come to me and say like, hey, I bought this thing like two years ago and it’s kind of not turning out the way I thought it was going to work. Like what’s happening here?
And I realized that a lot of people were getting advice that was either ill-informed, like the person who was delivering the advice themselves just didn’t know what they were talking about. Or it was presented in a way that was deceptive and designed to make the sale, but not really putting the client’s best interest first and explaining to them, what is this product really? How does it work? What can you expect to get from it over time? What should you not expect to get from it over time? What are the risks?
And being from a hedge fund investing background myself, like I’m very focused on risk management and thinking through both the upsides of something as well as the downsides. And I really think that’s the right intellectual framework to use for insurance as well. And I think perhaps the biggest proof that we do that well at AboveBoard is that we actually have clients where we end up not recommending insurance.
And I kind of figured out from my informal work with colleagues and friends back when I was at Goldman that, wow, there’s a lot of stuff going on in the financial services industry that’s just not a good idea. Or it’s in some cases an okay idea, but maybe not the best idea for that particular client. And like, man, with good analytics, getting the math right, and then also a desire to just level with people and help them, you can really affect just massively better outcomes than what’s currently happening.
And so that’s how we decided to start AboveBoard.
Bonnie: I mean, in the physician sort of world in terms of personal finances, I think physicians are kind of, unfortunately used to kind of being taken advantage of. Like people just see dollar signs and they sell us all sorts of things that maybe aren’t necessarily bad products, but just might not be the most appropriate thing for them at that time.
And so one of my goals is just to provide as much education as possible, because if you don’t know, then you’re not going to necessarily know whether you’re getting “a good deal” or good advice, right?
And so anyway, so I’m so glad you’re here. And we talked about beforehand already why I really wanted you here is to talk specifically about long-term care insurance. You know, I’ve had episodes where I talked about disability, I’m just thinking out loud here. I think an episode on the other types of life insurance products would probably actually be a good thing.
Maybe you and I could talk offline about that, mainly because term life is pretty easy to understand, but I’ve also been learning that it probably is best to explore some other options just because there are benefits to the other types of insurance.
But today we’re focusing on long-term care insurance. And I’ll just tell you sort of my limited understanding of it is, first of all, it seems like it’s hard to find someone who sells it. My misconceptions about it is that, like, is it really going to pay out? Just because the data is showing that we’re all living longer, so many more of us are going to need long-term care. Like are these insurance companies going to go bankrupt?
You know what I mean? Because an insurance company is a business, right? They’re not going to pay more than they’re going to make, right, because they’re going to go bankrupt. So how does that all work? And just like some of the costs I’m hearing of what people are paying for their parents is really scary. And so I think it’s a topic that scares people. And so we kind of avoid it.
Just like estate planning. I think the data is like 70% of families in the US don’t have an estate plan, which I’m sure doesn’t surprise you.
Wallis: Not at all, I see that a lot. And we actually help clients connect with legal professionals when asked. So that’s hugely important.
Bonnie: Yeah. So where do you want to start?
Wallis: Yeah, so how about we start with long-term care? Maybe what you mentioned about people observing their parents’ experience, because I think that’s often a catalyst for people to think about long-term care for themselves. And it also informs the expectations and assumptions people have about long-term care.
Bonnie: Well, let’s talk about Medicaid, too, because people also know that that exists.
Wallis: Yes. Yes, and so in terms of how to think about long-term care, it’s an industry that’s undergone a lot of change and it’s an industry that made a lot of mistakes in the 90s and early 2000s. And I would say that that book of business that was so problematic that the insurance carriers did back in the 90s and the 2000s is driving a lot of the things that people are observing their parents experience today.
So we often get clients who work with us on life and disability because they’re kind of like the young, like earning family stage of life. And they reach out and they’re like, wow, like my mom just got this letter and it says that her premiums are going to go up by 32%. Should we keep paying this or not? I think it’s a very common scenario.
And the reason for that is that a lot of companies wrote really aggressive policies based on faulty assumptions. And just to use round numbers, if you price this product assuming that 20% of your folks are going to actually need long-term care for an average of two years, and then you find out that actually 53% of the folks need long-term care for an average of three and a half years, that massively destroys the profitability of that business for the insurance company.
Bonnie: Yep.
Wallis: So what’s happening now is those carriers that made mistakes in the past are going to their state regulators asking for price increases, and in many cases being approved because as much as state regulators don’t like price increases, they really don’t like insurance companies going under on their watch.
And so that’s an important consideration that we’ll come back to in a minute when I talk about what’s on the market today and what to look out for as a consumer, and how to think about the choices that are currently available, because I have talked to a number of clients who were unaware that the price of the policies could go up. And the truth is that it was in the fine print all along, and it was probably sold in a way that either wasn’t transparent about that fact, or the person selling it might not even have been aware of it themselves.
And so people’s expectations about what long-term care is, is often formed by these policies that are relics of the past and not representative of what’s available today. And so what I encourage people to do is get a quote, learn what’s actually available in the market, and then make a decision based on those facts.
As humans we’re busy, and we want to give ourselves a pass to not have to take a to-do off our list. And so it’s easy to think like, oh, I don’t think long-term care is worth it, like it’s not worth looking at. But it really is worth taking a look because there are products in the market today that are very well-structured and can actually insulate you from that experience I was describing of getting really unpleasant letters saying that your price is going up.
Now, in terms of what is available in the market today, the mistakes that the industry made in the 90s and early 2000s have led to some different choices available in the market. And so traditional long-term care is one bucket of policies, and those are still available. There are some carriers that still do that. And those policies are generally characterized by you pay in premiums, and you only get money back if you have a long-term care need. So it’s a little bit like term insurance in that way.
But you can structure some of those policies so you get a refund of the premium. The reality is the math of doing that is rarely compelling, because, of course, the insurance company charges you more for that. So the right analysis then is like, well, if I just took the insurance-only product and invested my money elsewhere, how would that play out?
And we run that analysis, which I think is hugely different from how a lot of insurance brokerages operate. We will run that analysis for the client and just level with them about what the math says. I’m like, I love math. I love correct math. So if you do that for clients and you’re just honest about what it says, the right answer really becomes apparent.
So aside from traditional care, long-term care policies, there’s this newer category of policies which offer some very attractive benefits. And those are typically called hybrid or linked benefit policies because they combine life insurance and long-term care, but they’re really weighted towards long-term care.
Like the reason that you would get this type of policy is that you’re looking to hedge your future risk of needing a bunch of long-term care and wanting to be able to pay for it comfortably, without raiding your other assets. So these hybrid policies tend to be characterized by offering indemnity instead of reimbursement-based benefits. And what that means is that you don’t have to submit receipts.
Most traditional long-term care policies do require you to submit receipts. I’ve actually gone through this process myself with a family member. It’s not impossible, right? It’s definitely something you can do. But if you’ve ever put together a corporate expense reimbursement request, you kind of know.
Bonnie: It’s annoying.
Wallis: It’s not great, right? Like it’s definitely something you could do. You could have maybe adult children do it, but it’s not great, right? And so like these policies where you just don’t have to do it and all that’s required is proof that you need long-term care at all before you just get the benefit and then it’s your business how you spend the money. I think if you had a choice between the two and the price was the same, you would choose something that’s easier.
The other thing that’s nice about a number of these hybrid policies is that they’re fully guaranteed, meaning they do not give the carrier a contractual ability to raise the price in the future. Just the product is what it is. When you sign up for it, you put the premiums in that you expect. If the carrier realizes later that it mispriced your policy, that’s their problem to deal with. They have to go adjust their pricing on new business. They have to make other operational changes, but they can’t send you a letter telling you that it’s time to pay more.
Bonnie: Wait, so is this specifically for the hybrid policy or you’re talking about something else now?
Wallis: The hybrid policies tend to be fully guaranteed. And I’m speaking in generalities here because with hybrid policies, many of them are indemnity, but there are some examples that require reimbursement. But generally they are fully guaranteed. And so I like that aspect of the product where it just makes life easy.
Bonnie: Right, so there’s no surprises, basically. You know what you’re paying is what you’re paying, just like my disability insurance is fully – I know the language differs between insurance products, but I know my disability insurance, for example, is fully guaranteed and it’s also non-cancelable. So my premiums won’t increase, which as a side note, part of me feels like I’m surprised it doesn’t, just because inflation does exist. You know what I mean? But that’s not my problem, I guess.
Wallis: Oh, you mean you’re surprised that the premiums don’t go up with inflation?
Bonnie: Yeah, at least my disability insurance, I don’t know about the type of insurance you’re talking about.
Wallis: Yeah. Yeah, so basically the insurance companies kind of know that when they’re designing the product and so they have to model that out, right? Like they understand if I’m going to offer a fixed price product, I got to price it correctly because inflation does exist. They basically build it to account for an assumption about inflation.
And then the third thing you can do to get long-term care benefits is really to get a life insurance policy that allows you to take the death benefit while you’re still alive if you need long-term care. And usually the way that’s structured is that you can draw a certain percentage of the death benefit each month if you need long-term care.
That’s an option that can make sense if somebody is really focused on getting permanent life insurance coverage. And I’m using permanent life insurance to include any type of coverage that’s designed to last your entire life, whether it’s whole life or universal or variable. Permanent life insurance with a long-term care rider is another way to plan for a long-term care need.
On average, if you’re mostly focused on long-term care and you’re not that focused on the death benefit and legacy planning, usually something from the first two categories is going to be a better value for what you’re trying to do with hedging the risk of long-term care needs. But that permanent insurance option is available and sometimes it’s the best solution.
And so what we do for clients is we look across all these products and then we analyze like in different life scenarios what would the payouts look like? What would the returns be? And from that analysis, it becomes apparent when insurance makes sense and when it can deliver really significant value for people.
And so, for example, if we do the analysis and it shows like, wow, you’d have to generate like a 12% return before tax year in and year out in your brokerage account to come close to replicating this policy, that’s like really attractive because a long-term pre-tax return at 12% over the next 30, 40 years should not be your base case assumption for your financial planning, right?
That’s just too high. So markets have been on fire for the past, you know, really since the financial crisis. So it can be easy to sort of think like, oh yeah, I’ll make 15% of my money, but it’s not a good long-term planning assumption. And so we can do this analysis for people and the answer sort of reveals itself about whether insurance makes sense as part of the strategy.
And there’s like an emotional piece too that I think is important to consider because sometimes when people look at all these insurance options in the back of their mind, and I think this is probably especially relevant for your audience, where there’s a possibility of self-insuring and I would really encourage people to at least look at the insurance options before making that determination because long-term care is really expensive and it can go on for a really long time.
For women specifically who are lucky enough to make it to age 65, about one in five of us will end up needing long-term care for five years or more, right? That’s like a meaningful –
Bonnie: What are the costs? I know that’s a huge wild card, right?
Wallis: Yeah, so it varies a lot like where you are, but there’s really no place in the country where it’s cheap, right? So just like I, actually for this and I would actually encourage your audience to check it out for themselves, Nationwide, which is one of multiple carriers we work with, offers a really cool free online tool where you can just go and look up the costs of different types of long-term care by the area of your state.
So for example, like where I am in the New York City metro area, the average cost for a nursing home runs about $15,000 a month.
Bonnie: I know, which is insane.
Wallis: Yeah. And it’s actually even more ludicrous if you narrow it down to where I live currently, which is the Upper West Side of Manhattan. Yeah, I’m an only child and so being kind of a planner, I have visited facilities locally thinking like, okay, well, if just one of my parents or both my parents need this kind of support one day, where could they go that would be an easy walking distance for me? And the quotes I found from those places are 20 to 30,000 a month. I mean, it is real.
And even if I look at a much lower cost of living area, like where I grew up in Cleveland, Ohio, the nursing home average there is a bit over $9,000 per month. So absolutely less than Manhattan, but $9,000 a month is not an easy lift either. Even for somebody who’s quite well off, that’s a meaningful amount of money.
And I think importantly, it’s really important to try and put yourself in the headspace of where you’re likely to be in life when these types of topics are really presenting themselves. Some people need long-term care during their working lives, but for most of us, it’s something that happens post-retirement.
And so in that situation, right, like you’re oftentimes retired, thinking about, you know, maybe there are children and or grandchildren in the picture and you’re thinking about like, well, what is it that I want to sort of leave behind? How do I want to be remembered?
And when you’re self-insuring, it’s tough because you don’t know for sure that self-insurance money was needed for you until after you’re gone, right? Like even if you’re a healthy 82-year-old, you can’t decide then that like, okay, well, I was holding back this one and a half million dollars for myself, but like, I feel good. I’m going to just go ahead and give it to my kids or I’m going to endow something at my college that I want to support.
And so I think the long-term care can be a great tool for people to take risk off their own balance sheet, because even if you’re well off and you could spend down your own money to cover a five-year Alzheimer’s situation for yourself, like, do you want to manage your life assuming that you might have to, or do you want that to be someone else’s problem if it comes up?
And so long-term care insurance is the instrument for making that someone else’s issue to deal with so that you can focus on, this is my money, I’m going to choose to use it in a way that’s meaningful to me during my lifetime.
Bonnie: Yeah, no, that totally makes sense. Yeah, I remember hearing that cost before and it still just boggles my mind. So, okay. So everyone listening is probably freaked out. They’re probably paying attention now.
Wallis: I mean, it’s good to connect with reality, right? Because the reality exists whether you want to acknowledge it or not.
Bonnie: Yeah. So when should people start thinking about getting it? Because for example, for life and disability it’s kind of like as young as you can basically, right? And so when do you need to think about long-term care? Is it like just do it all at once? Like what’s the best recommendation?
Wallis: Yeah, that’s a great question. So with long-term care, one element of it that’s quite different from life and disability is that some of the carriers impose a minimum age that’s way higher than 18. And so for some long-term care companies, they won’t even consider you until you’re 40. Others, it’s 35, some it’s 30, but you really can’t get individual long-term care coverage in your 20s. And a number of carriers won’t consider you until you’re 35 or 40.
So I would say the ideal time is probably when you hit 40. It’s kind of a milestone birthday. Just go consider your options because at that point, the world is your oyster, right? One of the good things about turning 40 is that any carrier that does long-term care is excited to consider your application, which I know, might not –
Bonnie: Why is that?
Wallis: They just impose these minimum ages, I think, because they don’t want people who are coming in too early and holding their capital for that long. I won’t bore you with the details of insurance capital and regulation, but I think they’ve decided that for their business they just don’t want to have clients on the books for quite that long.
But once you’re 40, anything is an option. And then it becomes a question of, is there a way to get this thing to fit into your overall financial plan? Because as much as you want to be thinking ahead about your future self’s needs and planning for them while you have time, right? Like while you have good enough health to qualify, while you have enough runway to put the money in to have a meaningful benefit for your future self, that’s all great, right?
But the 40s also often coincide with when people have really high household expenses, right? For a number of our clients it’s the same period in life when they have kids at home and they’re saving for college and they have just a lot of things to pay for. So I think we do a very good job of helping people figure out a strategy that is both appropriate from a protection perspective, right, giving yourself some real benefit, but also aware that not everyone’s working with an unlimited budget and that’s fine too.
And we can help people understand like, okay, well, maybe it makes sense to get in place like 50% of what you’d ideally like to have today. And then in the future, once you’re youngest is off to college, maybe we’ll revisit then. And there’s some risk in that strategy for sure, because health can deteriorate, the person might not be able to qualify in the future. And those are all great reasons to kind of go ahead and get it done if you’re in a place where you can financially today.
But I think just realistically we have to live in reality and help people with the situation that they’re currently living in. And not everyone has the budget in their forties for the type of long-term care setup that they’d ideally like. But it’s really important not to let perfect be the enemy of the good. And it’s so high impact to have something in place versus nothing in terms of your own peace of mind and just like the gratitude that your kids will feel that you thought about this and set something up in advance.
Bonnie: Yes, the burden on kids is huge.
Wallis: Yes. And I think if I’ve made one insurance mistake myself in my own life, I really wish that I had been thinking about this back when I was a young professional in my twenties at Goldman. I wish I’d gone to my parents and been like, my gift to you with my bonus is going to be a long-term care policy for you, because it’s a lot to navigate and that was something I just wasn’t, it wasn’t even on my radar screen.
Bonnie: Well, it’s like people don’t know about this stuff. You know what I mean? There’s just not enough education. That’s one of the reasons why I have you on, so you can talk about it.
But one thing I want to ask specifically is, okay, so you said around 40 is maybe when someone should start looking into it, at least getting quotes and educating themselves about it. And you’ve talked a bit about the cost. Now, obviously I know you can’t give us what the cost is, but I’m sure you have averages, right? And do they do, is there a full medical underwriting involved, kind of like for life and disability?
Wallis: It’s a great question. So the underwriter always has the right to require those things. But in general, for most people it is not as heavy a lift. Oftentimes people do get waved through without a medical exam. Again, it’s very individual and the underwriter always has the right to require it.
Bonnie: Yeah.
Wallis: We see a lot of clients getting approved without needing to do that. One thing that came out of Covid that’s actually been a benefit for the life, disability, and long-term care industry is that carriers got much better at using electronic stuff.
Bonnie: Everyone, yeah.
Wallis: The benefit is that they’re better at accessing medical information and they can pull somebody’s report, obviously with the client’s authorization, right? As part of applying, you authorize the carrier to go out and look at the data they can easily get access to. And the reality is that if the carrier can get comfortable with your health profile using that information, they don’t really want to pay to send a person to your home to draw your blood either, but they’ll do it if it’s a necessary step for them to understand you as an applicant.
But thankfully for a lot of folks, the information’s already out there, right? They had a physical a year ago, they have data about them that can show that what they’re saying about their health is correct. And it just kind of sails through smoothly. I would say on average, it’s a much easier process than life or disability.
Bonnie: Yeah.
Wallis: All that said, life and disability has gotten a lot easier as carriers get better at electronic stuff to the point where we now have carriers who will approve people the same day with no labs.
Bonnie: Oh, wow.
Wallis: At the rates that you would get with a full medical exam. And obviously not everybody qualifies for that accelerated path, but a meaningful chunk of folks do.
Bonnie: So can we talk, I guess, a range, like for example because people ask me, like, oh, how much was your disability insurance? And I can tell them what mine costs. But again, as you know, it depends on, you know, I didn’t get it until I was, I think, 38 years old. I got it in New Jersey, not California, for example. It hurts my soul when that $7,000 leaves my account every November, but it’s like a $15,000 a month benefit, and that’s post-tax income. And so I pay it because until I’ve got a gazillion dollars in the bank, it doesn’t make sense for me to relinquish it at this point.
Wallis: Yeah, no, that totally makes sense. And I think that with a lot of these disability and long-term care products, you want to try and encourage yourself to hold it with the energy that you do with your homeowner’s insurance. It’s so interesting to me that very few people who own a home are like, I don’t need that insurance. Like if our house gets destroyed, I’m going to tell my spouse to start working more, right?
And yet we hear that logic with respect to disability insurance, right? Like if I get disabled, I’m going to tell my spouse to go back to full-time, right? And it’s just like that way of thinking about it is really just not a good idea. Like when that collides with reality, there’s a lot of hurt and anger in a situation that’s already difficult because of the health deterioration. It’s like you just really don’t want to set your future self up for that type of thing.
But with long-term care, I think this is a situation too where like, and having gone through it with my father-in-law, the stuff that’s happening at the time that you’re filing a claim, it’s just difficult, right? Like people end up in the circumstance in different ways, right? Sometimes it’s an accident. Sometimes it’s a long-term degenerative illness that people see coming. Other times it’s really sudden.
But the common theme is that it’s hard, not just on the person experiencing it, but the people around them who love them and who are trying to help support them through this clearly difficult time in life. And so I think that at least if you do the financial planning piece of it before you’re there, you can remove one really significant source of stress and it just makes it so much better for everyone.
But to go to your question about an example.
Bonnie: Do you want to just use me as a case study? I don’t know how easy it is to find a quote entering some info.
Wallis: Yeah. Yeah, so it would take me a few minutes to pull up a quote for you. I certainly could do that if you wanted to. But I also happen to have a quote up for an actual client.
Bonnie: Yeah, yeah, let’s go with that.
Wallis: And it’s a male/female couple. And to be clear, male long-term care rates are lower than women’s on average, all else equal, because as women, we are both more likely to need long-term care. And when we do, it’s also a longer need, on average. And if you’ve ever been inside of a nursing home, you might have noticed that a significant portion of the residents are female, right? And so that’s why the rates are different by sex.
Bonnie: Kind of like disability.
Wallis: Exactly. Exactly. We have lower life insurance rates because we live longer, but for long-term care and disability our prices are higher.
So this is a male/female couple, and they are both in good health. Not perfect health, but definitely very good health. And this is a policy that looks at a $5,000 a month starting benefit, and it would be covering both of them, right? So theoretically, they could both be on claim at the same time, each drawing $5,000 per month.
Bonnie: Oh, so you can get a policy for a couple?
Wallis: Yes, in fact, some of the best stuff on the market now is shared. It’s not always the case.
Bonnie: Do you have to be married?
Wallis: So the short answer is no, but there does have to be some reasonable evidence of a committed partnership.
Bonnie: Versus just picking a rando and just being like, let’s get this because it’s cheaper for both of us.
Wallis: Totally. Yeah, it’s like as a 44-year-old woman, I’m like, hey you, young man, get over here. No, it has to be kind of like a reasonable relationship.
Bonnie: Yeah, yeah.
Wallis: Committed partnerships, absolutely no problem. One of the things that we enjoy doing at AboveBoard is like pushing the envelope too. Like if something is reasonable, but maybe a little bit outside of what’s normally done, we’re totally happy to advocate for it. But yeah, absolutely. Like we work with couples who aren’t legally married, same-sex couples, absolutely no problem for the insurance industry.
Just want to be clear that the insurance industry, for as kind of old school and backwards as it can seem sometimes, is absolutely excited to welcome couples, however they define themselves.
And so the product that I’m talking about starts with a $5,000 benefit. And that benefit grows at 3% per year. And now, unlike most disability insurance policies where the inflation adjustment only starts to happen once somebody’s already on claim, with long-term care it works differently. The inflation adjustment, in general across most carriers, starts the moment you get the policy, which is super important because when you’re in your 40s and you’re planning for things –
Bonnie: It makes sense though, right?
Wallis: Right. You’re probably going to, in practice, need this thing 30 plus years from now. And so you want something in the policy where your idea of what you think you’re buying today is kind of matched up with what you’ll likely actually end up with.
Now you can choose different inflation adjustments. Like I’m running this with 3% compound. There’s also a choice for 5% compound. One thing I’ll footnote here is that you want to be careful with inflation adjustments because sometimes they’re quoted only lasting for 20 years. And so for me as a 44-year-old, if I bought that policy, I’d get an inflation adjustment until age 64, but then nothing, right? And that’s not very helpful either.
Bonnie: That’s like fine print stuff you need to be aware of.
Wallis: Exactly. It’s like super sketchy fine print and the reality is that you don’t have to run the quote that way. So even though it makes it look cheaper, we never run quotes that way at AboveBoard because I think that it’s misleading.
Even if people know that that’s technically what’s happening, it can be hard for them to conceptualize what that means if they have a claim when they’re 80 and they’re like16 years past the end of the inflation adjustment. It’s just not the right way to talk about the product in my opinion. And so we always run our quotes with lifetime inflation, at least 3% compound.
And then the other thing you have is a choice with long-term care is how long you want benefits to last for. There are very few unlimited products in the market today.
Bonnie: That makes sense.
Wallis: Mostly because of what I said earlier. Yeah, mostly because of what I said earlier about how some companies really blew themselves up over promising stuff.
There is one product still out there that’s unlimited. As you might guess, it’s pretty expensive. We do work with that carrier and have done that before. With these policies you have a choice about how long you want the benefits to go for. And oftentimes for an individual policy, it’s just as a one person choosing the maximum benefit period you would want. But then for these shared products, you can actually share the benefits with your spouse, which I really like because the reality is that we don’t have a crystal ball, right?
Bonnie: So like you can share 10 years?
Wallis: Exactly.
Bonnie: So like one person can use it all or you can share it. Is that kind of what you mean?
Wallis: Exactly. Exactly. So in the case of this product, it is an eight-year benefit period product, but it can be divided up between the two people however they need it, right? So if both of them need it simultaneously for four years each, that works. If one of them has an extended memory care experience that goes for like seven or eight years for that one individual, that person who needs it can use all of it.
And so it’s a nice product because you don’t know what the future holds, but you know that eight years between the two of you is statistically very likely to cover most scenarios that you would encounter.
Bonnie: And you have that data in terms of how much time you would recommend per person?
Wallis: Yeah, we can definitely walk people through that. And so just sort of in round numbers, the average male long-term care need runs for about two years. On average for women, it runs for about three. The challenge is when you get into those tails, right? And so for women, about 18% of women who see age 65, end up needing long-term care for five or more years. And then for men it’s 10%, right? So it’s meaningfully lower for men.
So we actually have a table where we run the math for couples based on the gender identity of the couples, the people in the couple, and just talk about like, well, what are the odds of the two of you as a couple encountering this scenario versus that scenario? And it helps people get in touch with what their future selves might experience so they can make good choices today so that if they end up in that situation, they feel like, okay, I know what’s happening here. We’re ready for it.
Obviously any scenario where somebody’s needing long-term care is not the dream scenario, but it can be so much better when you feel financially supported through it.
So going back to this. This is set up so it’s 5,000 starting benefit a month, 3% compound adjustment for life, maximum eight years of benefits shared between the two of them. And the cost of that, if you wanted to pay for it in just over 10 years, right? So sometimes people, I personally subscribe to this view, feel like I don’t want to be 77 years old and needing to open the mail or log in and make a payment. Like I could get a lifetime pay policy, but I don’t want to deal with that.
And so in this case this couple felt like, yeah, in retirement we just want to be like chilling, hopefully having fun and good health and be done with this long-term care stuff. And so for this 47 and 45 year old couple, they were looking at a 10 pay strategy. And so for 10 payments, it would be $13,002 per year for 10 years. So in total $130,000 in round numbers.
And then that benefit pool projected forward, right, it would continue to grow. And so by the time that they’re statistically more likely to be needing this stuff, let’s say that mid seventies is when they would access it. They would have a total benefit pool that’s over $1.25 million.
Bonnie: Mm-hmm.
Wallis: And they could draw that between the two of them. And then if they don’t need this until they’re in their mid 80s, that benefit pool would have grown to approximately $1.7 million. And so they’re basically done paying for this thing after 10 years, and then it just grows. And those are really attractive IRRs, right? Like you should not be betting that you’re going to get a brokerage account return that would even come close to that.
Now, in a scenario where they live the dream and so they live into their 90s, they’re like those people you hear about that are still active gardening and going to like weekly readings at the library their entire lives, right? It’s just like, we actually have some neighbors that kind of fit this profile and they’re like my icons of aging well, but that’s not everyone’s future.
But for people who it is, this product has a death benefit so that you basically get back a very modest financial return that you can pass on to either your loved ones or organizations you care about. In this example, the death benefit is 180,000 if you never touch the long-term care benefits. And if you use a little bit of long-term care but not 180,000, then you get paid back the remainder.
And this product also has a minimum death benefit. And this is back to the hybrid life LTC, it has like a $18,000 death benefit even if you max out all eight years of benefits. So it’s kind of a cool product because when we run the numbers on this, it’s a really interesting edge for that scenario where one or both of them has meaningful long-term care needs and it allows them to like –
Well, they will pay for it in 10 years. You can also choose to make a lump sum payment for a discount, right? That’s an option too, because sometimes people just want to be done right now, never have to think about this again. And that’s possible too, but it can be a really smart strategy for people to move this risk off their own balance sheet so they’re not sitting there thinking like, oh man, we would love to make this gift to our alma mater and have this chair named after us. But she’s like, if we need long-term care, could we afford it, right?
It really frees you up to live the way you want to live with your money, knowing it’s really yours for what you want to do.
Bonnie: Yeah. I mean, even just hearing those numbers, like for most people, and even just my thoughts, it’s like, yeah, that’s basically, they’re spending a little over $1,000 a month. And most people are probably like, well, I don’t want to pay, you know, like in your words, it is a meaningful amount of money. It’s not like it’s 250 bucks a month where most people are like, oh yeah, that’s fine.
Yeah, my disability insurance, I guess, I think it comes out to $583 a month. And that’s just me, so I guess if I double that, it’s not that unsimilar, right? So I’m guessing that many people listening might be like, well, that’s more than I want to spend right now. But then what I really like about your approach is it’s a lot of math and data, but just showing what’s at risk if you don’t consider getting it earlier.
And that’s the same thing with life insurance and disability insurance, right? A lot of people, I feel like people understand life insurance because everyone knows they’re going to die. But disability insurance, I see a lot of people are like, well, I don’t really need that. And then for some reason, everyone thinks they’re invincible until they’re not, right?
Because, you know, a car accident, which you don’t have control over can happen and that could become a, you know, maybe not a lifelong disability, but can significantly impact your ability to make money as a physician, right? Especially if you’re a surgeon. I just think there needs to be a lot more education about potential costs because even the scenario you gave us, and thanks so much for giving us some specific numbers, like even on mine I’m like 5k a month, isn’t really a lot.
Wallis: So 5k is a very meaningful contribution to the difference between your existing lifestyle and the extra support that you would need if you needed long-term care. And some of our clients do choose to do more than 5k, you know, because obviously if you’re planning for a long-term care need in Manhattan, like 5k is probably not going to get you what you’re going for.
But in terms of thinking about, well, if you live the dream, right? You still have household expenses, but then if you also have one or both of you needing meaningful support in the form of long-term care, it’s going to cost more. And so the way that we think about what the long-term care benefits should be is not necessarily your total expected cost if one or both of you needed long-term care, but looking at the difference between that cost versus living the dream.
Because you should be saving for retirement separately from planning for a long-term care need, right? And then hopefully you do live the dream and just have normal household expenses, travel, good meals out, whatever it is that brings you joy in retirement, right? There’s just like expenses associated with that baseline of living.
And then for the long-term care benefit, we recommend thinking of it as what like extra boost would you want to take off your balance sheet where it’s not your problem if that comes up? And so for some people, they say like, oh yeah, no, I’d want to stay fully set up in my situation and just be able to go visit my spouse in a really lovely $15,000 a month long-term care facility near our home. And if that’s the analysis, then yes, $15,000 a month is the right benefit number to use.
For certain people they kind of feel like, you know what? That sounds great and I would love to do that if I had the ability to afford it. But again, you can’t let the perfect be the enemy of the good. And wow, for like $5,000 a month, that would cover an assisted living facility in a lower cost of living area. It would also cover a meaningful amount of in-home care, even in the New York City area, right? Like it’s very helpful support in that situation.
And so it’s ultimately like an individual analysis about what do you envision for your future self? What options would you want to have? And then also like, what are the realistic budget constraints, right? Recognizing that you don’t necessarily need to get straight A’s to get your diploma, right? We’re trying to get the diploma here, right? Like it doesn’t have to be this fantastic, perfect thing on your first try.
Maybe you start with something that puts you on a good path. And then if later circumstances change and you can get a little bit closer to your ideal, that’s great. But at least you laid the foundation to not be flying without any parachute.
Bonnie: Yeah. How quickly can we talk about Medicaid? Maybe not physician families, but I think they might have parents where they’re like, well, they’re going to be eligible for Medicaid. And people kind of use that as their safety net. So I’m sure you have thoughts about that.
Wallis: I do. I do. So, I mean, Medicaid is a tremendously helpful safety net for people who don’t have other options, right? So I don’t want to in any way belittle Medicaid as an option that can provide meaningful support to people who would be in a far worse situation without it.
That said, I think people need to understand that Medicaid is not just the government covering the experience that you’d otherwise pay for yourself. There are some very meaningful constraints if you’re relying on Medicaid. And sometimes, especially when it’s clients’ parents, right, where they’re already in their 70s or 80s and kind of the time to make different choices is unfortunately already passed, right? Sometimes that is the only option.
But to be clear about Medicaid, a number of nice facilities will not accept Medicaid patients. And then also a number of facilities limit the number of, like “Medicaid” beds they have available. And so if you’re relying on Medicaid, you might find you’re in a situation where you end up an hour and a half drive from your children in a neighborhood you don’t know and don’t like. And you kind of have to go where there is availability and you’re at the mercy of the bureaucracy that’s deciding where they have space for you.
And yeah, I think for people who are kind of more at our stage of life and are earning and still have time to plan, I’d encourage you to try and connect with the way that you think about planning vacations, right? Are you kind of like, I’m going to go to the cheapest hotel I can find on TripAdvisor, 100%, sort by price, cheapest. I’m doing it, right? It’s like, is that how you plan? Or do you plan for the kind of experience that you’d like to have involving some comforts or things you enjoy?
Bonnie: I’m pretty sure the latter for my listeners.
Wallis: Yeah, I was sort of guessing that was probably the case for most people. I’m like, if it’s the latter, you should really bring that mindset to your own long-term care planning and think about it like, I don’t want to be staying at a nursing home that looks like a hotel I never would have chosen in my 40s.
Bonnie: Yeah.
Wallis: And on a personal note, I have a dear family friend that passed away a number of years ago, but she was kind of like my adoptive grandmother growing up in Ohio. And she was on Medicaid and I visited her in the facility that she was in. And it was frankly horrible.
It was in like a nice suburb of Cleveland, but just not very nice. Like not a place where, you know, she passed away when I was still kind of in my early 20s. But I was like, man, I’m like, this is not the thing I would want for my future self. And so I think that people should really think about pursuing options other than relying on Medicaid if those options are available.
But recognizing that sometimes, especially for aging parents who are kind of already at that moment in life, like it is the best option available. So you just kind of have to deal with it. But if you have time to make a different choice for yourself, really try to prioritize that because it makes it so much better.
Bonnie: Yeah, no, that totally makes sense. What’s the best way for people to find you?
Wallis: Yeah, so we have a website, aboveboardfinancial.com, that folks can always come visit. I mean, also feel free to just drop me a note. My name is a little bit funky, so I would suggest just dropping a note to [email protected]. And my entire team and I have access to that email, so we’ll see it. Just mention that you heard me on this podcast and we can help you get pointed in the right direction, help you figure out what you’re trying to navigate and really work with you to develop a solution that makes sense for your situation and goals.
Bonnie: Yeah. Well, thank you so much for your time. This has been really educational for me since we first connected, and so I definitely will probably seek out a quote as well.
Wallis: Awesome. Well, we look forward to helping you. And thanks so much for having me on, this was really fun.
Bonnie: Great, thanks so much.
Hey there, thanks so much for tuning in. If you loved what you heard, be sure to subscribe so you don’t miss an episode. And if you’re listening to this on Apple Podcasts, I’d love for you to leave a review. Reviews tell Apple that this podcast is, well, awesome. And it will help women find this podcast so that they too can live a wealthy life. And finally, you can learn more about me and what I do at wealthymommd.com. See you next week.
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209: Relax, Learn, Grow: Highlights from My Conference Journey
I recently took a two-week trip to the Caribbean to attend several conferences, but this time, I was there solely as an attendee, which was a refreshing change from my usual role as a speaker. In fact, this new perspective allowed me to fully immerse myself in the sessions and absorb the wealth of knowledge being shared, some of which I'd like to share with you in this episode.
Throughout the trip, I participated in four unique conferences, each offering valuable insights and fresh ideas. From the Prosperous Conference by Semi-Retired MD hosts to an eye-opening discussion on AI technologies, I gained a deeper understanding of the latest trends and strategies in various fields. The location of the conferences, the speakers, and the topics we covered were all purposefully designed for relaxation and a focus on business and personal growth.
Tune in this week to learn about my key takeaways from these conferences, including the importance of staying updated with technological advancements, the benefits of attending mastermind groups, and the necessity of diversifying investments. Whether you're looking to enhance your business acumen or stay ahead in the ever-evolving tech landscape, this episode is packed with insights that will inspire and inform.
Learn more about Money for Women Physicians, an exclusive money coaching program to get your money and mindset working for you.
The 2025 Live Wealthy Money and Wellness Conference for Female Physicians is opening for registration on May 29th, 2024. Ensure you're among the first to secure your spot and save $500 by joining our waitlist now! Click here to join the waitlist and get exclusive access.
What You'll Learn from this Episode:
- Learn about the latest advancements in AI, including practical applications for business and customer support.
- The importance of diversifying investments beyond the stock market.
- The value of mastermind sessions and collaborative problem-solving with other entrepreneurs.
- How to balance professional development with personal growth.
Listen to the Full Episode:
Featured on the Show:
Welcome to The Wealthy Mom MD Podcast, a podcast for women physicians who want to learn how to live a wealthy life. In this podcast you will learn how to make money work for you, how you can have more of it, and learn the tools to empower you to live a life on purpose. Get ready to up-level your money and your life. I’m your host, Dr. Bonnie Koo.
Hey everyone, welcome to another episode. So I recently came back, at least at the time of this recording, from two weeks in the Caribbean and I wanted to tell you all about it because what was different about this trip is, first, I attended four conferences/retreats and I attended as an attendee.
I mostly travel to conferences as a speaker and I honestly can’t remember the last time I was just an attendee. And it was wonderful not to be a speaker, because when you’re speaking it’s like you can’t really relax until your talk is done and you kind of have that on your mind. And so it was just really nice to be able to participate and to get my learning on.
So the first conference I went to was called the Prosperity Conference, and it was hosted by my friends, Leti and Kenji. You may know them as the duo behind Semi Retired MD, many of you have taken their courses on real estate. And so they had their first conference and it was on health, wealth, and relationships. And obviously there was some real estate in there, but it really was covering a large variety of topics.
Now, the one that I specifically wanted to talk a bit about was we had a fascinating talk on AI, and I wanted to talk a bit about AI. And I think I’m going to do an episode just talking about how you can use AI, specifically things like Chat GPT or Gemini. Most of you kind of know what Chat GPT is, it’s by a company called Open AI, but there are other companies that provide AI, and Gemini is by Google.
Personally, I’m a little surprised that Gemini isn’t sort of the end all be all, because you would think with Google kind of having access to all that data would be really good at it, but I heard it still has a long way to go. But what I have heard is that Gemini is a bit better in terms of writing and crafting emails. And so I’ll talk a bit about, in another episode, how we’ve been using it in our business and some ways that you can use it for those of you who don’t have a business, because I think it’s going to be a game changer.
Now, like I said, we already use it inside my business to help with customer support emails and give us ideas for all sorts of various things, including marketing. But he showed us a way to prompt it, and what that means is that the more information you give Chat GPT, the better the answers will be. So the example that he showed us was he basically had it write a book, create the marketing plan, create sample testimonials. I mean, it was ridiculous what it was able to do with very specific prompting.
And so, like I said, I’m not going to go into the details, but what it really showed me was just how important it is for all of you listening to really learn about AI, because it is going to, well, I think already is becoming a part of our lives. Maybe not directly right now, but if you’re a physician listening, you may know that there’s lots of AI scribes available and it’s really going to change the way we practice medicine, whether you like that or not, but it’s coming. It’s already coming. It’s already here. And I just want to encourage you to get on board with it, learn as much as you can.
Now, a few episodes ago, I posted my talk from the first Money and Wellness Conference. And if you haven’t listened to it, I really encourage you to do so because I talk about how important it is now more than ever to really develop skill sets that are portable. And besides your ability to be a doctor, because people are upset that medicine is being taken over by XYZ and how we’re being replaced by PAs and mid-levels.
But I will tell you that we really need to take matters into our own hands. It’s really important to take responsibility for our lives, and learning how to use AI is going to be part of it.
Now, I’ve been meeting a lot of physicians that have created their own telehealth platforms. I think that definitely is the wave of the future. And that does require a bit of an entrepreneurial spirit, but I think it’s something that all of you should consider if you’ve ever considered opening your own practice. Depending on what you do, I’m just guessing that certain specialties aren’t really amenable to an online platform.
But I just really want to encourage you to learn more about it. I don’t quite have a resource for you to learn more about it, but I know there are, someone told me there’s courses on how to prompt it.
But the main take home message that I wanted to say about that talk was just, if you have children who are a little bit older, like high school or college, they really need to learn how to use it. It’s going to be a great skill set that’s marketable. So I know they have courses available. They even have conferences. So that’s something I’m even thinking about for my bonus son who’s 17.
Okay, so that conference was in Puerto Rico. And I got to see, like I said, my good friends, Leti and Kenji, and my friend Sonny were there. And then Sonny had a retreat for her empowering women physicians coaching group. And I guess I’m a, she calls me an alumni because I was one of her one-on-one clients.
And this retreat was mainly for her alumni to get together and to sort of share things. And what was great about it for me was I got to see a lot of friends and reconnect with them. And I brought Matt and Jack for that part of the trip. And so after the EWP retreat, Matt and Jack went home and then I moved on to the British Virgin islands.
And specifically we were at a private Island called Buck Island called Aerial, A-E-R-I-A-L. And it’s a privately owned Island and Sonny had identified it. She was introduced to it through a friend who knew the owner, and myself, Sonny, and a few other physician entrepreneurs, including Leti went there. And we went there specifically, well, not just to relax, but also to mastermind, and I’ll tell you what that means in a second.
And this was a beautiful place. And we really had the privilege to actually spend some time with Brittany, who’s the owner. And she is a female entrepreneur and she’s on the younger side and her story is amazing. She is so purpose-driven and it really just made me think like, it’s not that you have to be as purpose-driven as her.
Like she really has a vision for how she wants to use money for a great cause. She’s really passionate about sex trafficking and child trafficking, and so she has a foundation to help catch these bad people, basically. And so she shared a bit about how her foundation has really helped in that effort and told us her story. How she came to be where she is now and basically how she became so wealthy.
And it was real estate, but it was her willingness to meet people and to basically be like, I want to learn from you. I will work for you for almost free. And how she had no money, but she figured it out. And her drive and passion was just so, so impressive. And it really made me think about sort of what vision I have and where I want to take my company.
And so then the rest of the time we masterminded and you spend time with other entrepreneurs and you help each other out. It’s not like there’s one head figure or business person who’s teaching and leading. It’s a really collaborative thing. It can be led by an expert. The whole point of masterminds is to mastermind with other people.
And so what we all did is we kind of all went in front of our group. We were kind of in this amazing, beautiful setting on the beach and we were sitting on a couch and then someone else had to sit up front and basically present, I guess you could say a problem or a situation that they needed help with, right?
And so I think five of us went up, I went up. And just to give you a preview, I am working on a business program, maybe there’ll be some masterminding involved. But it’s really meant for me to teach online business owners, specifically coaches and course creators, where I will be teaching you how to run a business smoothly.
Specifically all the things, business operations, understand your business finances, things like metrics, how to hire a VA, how to organize your business, like what are the systems you need, how to create SOPs and basically get your business in order and clean because if you don’t have this figured out, as you grow and scale your business you’re basically going to scale a mess. And it’s a lot less painful when you know how to do that and you know how to train and onboard them properly.
And so that is something I am working on. I don’t know when it’s going to start or where I’m going to offer it. My guess is it wouldn’t start until August. So keep that in mind. And one of the things I am thinking about is that if you do join the first group, we will do a special extra day in Hawaii at my second Money and Wellness Conference, that’s going to be February 20th to 23rd.
And you probably know that that’s happening. And I just want to let you know that you definitely want to join the wait list for that conference. Go to wealthymommd.com/conference and join the wait list. Joining the wait list is well, first of all, two things. One is you’re going to get $500 off and you really want to save your spot ASAP because we have a room block at the Four Seasons at basically 50% off. So it’s a very significant discount, okay?
I don’t know, I want to say at least 10 rooms are gone, maybe 15, possibly more because we’ve already had 24 people sign up from the previous conference. And I think we have about 40 rooms. Now, you’re not required to stay there. So you don’t have to stay there obviously, but if you do and you want to take advantage of this 50% off room block, then you definitely want to save your spot in the first few days starting May 29th.
And again, you have to be on the waitlist to get the invitation to join or register, I should say. So that’s wealthymommd.com/conference.
So yeah, when I offer this business thing, I don’t even have a name yet, but it’s going to be six months and we’ll do an extra day in Hawaii and we’ll meet and we’ll talk about your businesses and what you want to work on.
Okay, so that was an amazing experience. Got to spend time with amazing women, got to be on an amazing beach, eat good food, and just have a lot of fun with lots of other activities. So it was just a really nourishing time.
Now, after that I flew to the Bahamas and my family met me there. And there’s no direct flight from the British Virgin islands to the Bahamas, so I had to fly to Miami and then Miami to Bahamas. Anyone familiar with the Miami airport, it is a bear of an airport. And I don’t know why it’s so hard to navigate, I feel like it’s just not very well organized and there –
Anyway, I don’t want to complain too much, but it was a little stressful, even though I had a pretty long connection time to just figure out where I needed to go.
Now, we stayed at Atlantis and the reason why I was there was it was for the Eckard Enterprises Partner Conference. Now, Eckard Enterprises is a company that invests in mineral rights and a bunch of other things as well, but sort of their flagship in terms of how most people end up working with them initially is to invest in mineral rights.
Now I’m not going to give specific details about it, I’m probably going to have, I’m not quite sure if it’s going to be Troy or David on my podcast to talk more about it. And some of my clients have invested with them and have been really happy.
I will say that they’re a pretty extraordinary company in terms of transparency and customer service. And that’s always important to me and I only like to recommend companies like that, that honestly that I’ve personally invested with and that I believe are good companies and will do good by you.
So this conference is something they’ve started doing a few years ago and only their investors, and they call their investors partners, are invited. And it was basically, I think it was two or three days of programming to kind of talk more about what’s going on in their business, but also to educate us.
And so the second day that I attended was amazing. They had all these different experts in different parts of finances and kind of gave us an overview of what’s going on with the economy where they see things going and just presenting some really amazing data that you wouldn’t really get in any sort of regular financial education because it’s kind of like, this is what’s happening now, these are the things you want to think about.
And so some of the stuff he said I actually have heard before, but like through friends though. And it was good to kind of hear it from some expert and be able to ask questions. And so one of the things that I want to talk to you about, and if you’re on my email list you got an email about this other day, is that basically there are cycles and there’s economic cycles and there’s social cycles and that we’re sort of on this end of a cycle.
And it’s not a good part of the cycle to be in. It’s kind of like the decline. And I don’t mean like everything’s going to go to crap, but there are cyclical things that have repeated multiple times in history. And sort of what’s going on in the political climate, et cetera, like these have all been predicted based on the past. And so I found that fascinating in itself.
And in terms of finances and the economy, what I really took away is that things are changing rapidly. And my little spiel about AI earlier is just part of it, like things are changing so, so rapidly. The job market’s going to change rapidly because AI will replace certain types of jobs. And because the US has printed so much money and with inflation, there’s just a lot of downstream effects.
And so what I really took away is that it’s really more important than ever to have your money in diverse investments and not just the stock market. And I see so much of that education out there saying, set it and forget it. Invest in the stock market, max out your retirement accounts and you will be fine. I actually think that’s dangerous.
Now, I’m not a financial advisor. And so this is not specific advice, but I will tell you that all of my rich friends do not have all their money in the stock market. In fact, I would say that’s probably on the smaller side of their portfolio. And a lot of it’s in real estate, all different types of real estate. When people say real estate, they think of owning homes, et cetera, and that could be part of it, but there’s so many different ways to invest in real estate.
Now, Eckard Enterprises, you could think of it as real estate. And so just to give you an overview of what mineral rights means is when you own land or like a single family home, you kind of own what’s above ground. With mineral rights, you own below ground, and so you actually get to own physical land and you have the rights below for mining basically.
And it’s something you can leave to your children and it just continues to pay out. And I think that’s really the difference here, right? Because when you invest in the stock market in a retirement account, you know, you are putting money in its pre-tax, which is fantastic. It is growing pre-tax, again, fantastic.
But then ultimately you have to sell it and you withdraw. And you may have heard of the 4% rule where you can withdraw 4% and you probably won’t run out of money. At least it’s highly, highly unlikely, but you have to wait until you retire in order to get that 4% payout, you know what I mean? Whereas when you invest in other types of investments like mineral rights, you actually get paid pretty quickly and maybe like 10% a year that you get paid consistently.
Now sometimes they’re monthly, sometimes they’re quarterly, but do you see the difference? Like you don’t have to wait 30 years. And they’re all affected differently in terms of how the economy is doing. And so again, the bottom line is it’s important to have your money in different places. I’ve invested in one deal with them.
And a lot of people, and maybe you, you might be thinking I would love to invest in something else, but I don’t have the capital. And one way to get capital is actually inside your retirement account. Now you need to have either a solo 401k for the most part. Now, very few employer sponsored plans will let you do a self-directed 401k. It’s pretty unusual. So you probably don’t have access to this.
But self-directed means, basically it’s a way for you to invest in these passive investments with the money inside your retirement account. So my 401k is self-directed and it’s invested in syndications and I participated recently in a land deal where I’m part of owning a piece of land and it doesn’t pay out until the land is sold, but we’re planning to exit within two or three years. So I’m definitely interested to see how that deal goes.
If you have a Roth IRA, that’s actually something you can convert into a self-directed IRA. And so most of you probably have a Roth IRA that’s not tied to your employer at all. And so I’m actually looking into possibly converting my Roth IRA into a self-directed one so I have money to invest into some deals.
And again, just thinking a lot about my finances holistically, I’m going to have to sit down and take a look at where our money is invested and basically make some decisions, or maybe not, but just take a look and be like, do we like how we’re investing the money? Do we feel that this is going to help us reach our goals?
Because what you’re going to do, how you’re going to do it is going to be informed and predicated by what your ultimate goal and vision is. Do you see what I’m saying? And so that’s one of the reasons why in my course, Money for Women Physicians, that we actually just wrapped up about a month ago and we won’t be offering again until the fall, for those of you interested.
We’ve gotten some emails asking when the next cohort starts and it’ll probably be the end of September. The first thing we do is what is your intention? What is the vision that you have? Because ultimately money is a means to that, right? It’s like you’re not just trying to make and have more money just to have more, it’s to facilitate the vision you have.
What I mean by vision is it doesn’t have to be this crazy thing like you want to solve world hunger. What I really mean is what do you want your life to look like? If you have a family, what do you want your family’s life to look like? How do you want to spend your time? What do you want to be able to do and how much money would you need to achieve that, right? And so that’s what I mean by intention.
And of course, some of you in my program also might have a practice or another type of business, and so if you do have one also just as important to think about what is the vision, what do you see as the outcome of that business?
So again, I’m going to have someone from Eckard on the podcast soon and we’ll probably do a live sort of webinar type thing. And so we have a call with DLP Capital and they are a company that offers private REITs. And I really encourage all of you to learn as much as you can about all of these different types of things.
Now, obviously, I’m introducing you to these companies that I believe are doing good, are doing a great job and are honest and trustworthy. And I usually have some sort of financial relationship with them, but you can watch the replay, just email us if you haven’t signed up for it already at support at wealthymommd.com. We’ll probably be sending out an email with the replay, so if you’re on my email list, we will be sending that out.
But again, I’ll be scheduling something soon with Eckard Enterprises so you can learn more about mineral rights, why it’s something you might want to consider and just how it works and just being introduced to that company.
All right, well, that’s all I have for you. And maybe I’ll see you at a conference this fall.
Hey there, thanks so much for tuning in. If you loved what you heard, be sure to subscribe so you don’t miss an episode. And if you’re listening to this on Apple Podcasts, I’d love for you to leave a review. Reviews tell Apple that this podcast is, well, awesome. And it will help women find this podcast so that they too can live a wealthy life. And finally, you can learn more about me and what I do at wealthymommd.com. See you next week.
Get started on your journey to wealth by getting my FREE book- Defining Wealth for Women.
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For all other inquiries please click here.
93: Money & Shame
One of the biggest barriers that stands in the way of us making money, enjoying money, and ultimately having as much of it as possible is shame. So many women experience shame in various areas of their lives, so it’s time to talk about it so we can begin to change this story.
Shame brings up a lot of negative emotions, and negative emotion can never be a driver of positive change. When we feel shame or any negativity, it’s because we think there’s something wrong with us, and we generally try to make ourselves feel better as quickly as possible. We try to focus on something else instead, like Netflix. But what if there’s actually nothing wrong with you?
Tune in this week to discover the key to creating positive changes in your life. I’m sharing where our shame comes from so you can see how to stop beating yourself up and indulging in shameful thinking and self-judgment, especially around money.
Join me for Defining Wealth For Women Live, a FREE 30-day book club party! Hang out with me and other readers in our private pop-up Facebook group and get coached on topics from the book. I can't wait to see you there!
If you're ready to take control of your money and practice medicine on your terms, you need to check out Money for Women Physicians. Click here to learn more!
What You'll Learn from this Episode:
- Why women are particularly prone to shame, especially around money.
- How not talking about money only perpetuates the shame so many women experience.
- Why you can never make a positive change from a place of negative emotion.
- Where your focus should be if you want to create lasting change.
Listen to the Full Episode:
Featured on the Show:
- Learn more about Money for Women Physicians where you'll learn the tools to make practicing medicine OPTIONAL.
- Follow me on Instagram
- Brené Brown
- Atlas of the Heart by Brené Brown
Welcome to The Wealthy Mom MD Podcast, a podcast for women physicians who want to learn how to live a wealthy life. In this podcast you will learn how to make money work for you, how you can have more of it, and learn the tools to empower you to live a life on purpose. Get ready to up-level your money and your life. I’m your host, Dr. Bonnie Koo.
Welcome to episode 93. So before we get into today's topic, which I'm actually super excited about, but my book just came out. I'm recording this the week before this episode is coming out, my book launched on January 11th, Defining Wealth For Women. And thank you so much for those that have bought that have left reviews, it means so much to me. But honestly, it's going to help so many women.
And so the more of you who read it, leave reviews, and tell your friends about it, we're just going to help so many women with money. And actually that's a great segue in today's topic, because so many women have so much shame in general, and specifically money shame.
So before we get started I do want to tell you because this is coming out right before we start Defining Wealth For Women Live, and think of this as a book club party, a virtual book club, whatever you want to call it. But it's 30 days with me in a pop-up Facebook group and eight live coaching calls with me, where I will coach you. I will coach your brain on the topics in the book.
So each call will coincide with a chapter, we'll do a brief discussion. I will have assumed that you've read it, so this event is totally free but you should probably buy the book so you understand what's going on. And it's basically a way to really deepen your understanding of all the material in the book.
And the best part, it is free, just the price of the book. So you want to go to wealthymommd.com/live, L-I-V-E, so you can join us. And we'll send you an email with the Facebook link and all the details about all the calls and when they are.
And they will be recorded, we're actually going to stream the calls into Facebook. The calls will be on Zoom, but we'll stream them into Facebook as well to make it as easy for all of you to watch and take part in these live coaching calls.
All right, so I'm so excited to meet many of you in that group. Some of you may know, or many of you may know that I used to actually have a public facing Facebook group, which I closed down about a year ago. And so I do miss that interaction. So it can be really fun for me and for you to just hang out, talk about money, and get excited about what the future can hold for us.
And so one of the big barriers between us making money, having money, enjoying our money is shame. And so I want to talk about shame. And many of you are familiar with Brené Brown, she's a– I actually don't even know what I should call her. But many of you know her because she has a very, I think one of the top five most watched TED talks, and I think it was about shame and vulnerability. But she is actually a shame researcher.
And so I have learned so much from Brené about shame. And I may have talked about the book that she just published, I think it's called The Atlas of Emotions, and it is an amazing book. It's probably not for most of you. What I mean by that is, it's not your typical nonfiction book.
It's really an atlas, almost like an encyclopedia about human emotions. And so if that's something that interests you, I definitely recommend buying it. But it's not like a typical book that kind of takes you through X, Y, Z.
So anyway, I really want to talk about shame. And I want to actually explain what it means just so we're all on the same page, you guys all know I love definitions. And here's what Brené says about shame, she says that shame is focused on self versus behavior, right?
So when you have shame, you're thinking something like I am bad. And the result of feeling shame and thinking I am bad, is you basically feel flawed and unworthy of love, belonging, and connection. And I think here's the most important thing, shame is not a driver of positive change.
And so Brené goes on to further describe shame. And she describes it as an intensely painful feeling or experience of believing that we're flawed and therefore unworthy of love, belonging, and connection. And so shame might seem like a, I don't want to say like loud or extreme way to describe it. And so if that's the case for you to substitute feeling bad about yourself or beating yourself up, because I know that all you type A ladies love to beat yourselves up.
And what did I say earlier? Shame, beating yourself up, feeling bad is not a driver of positive change. Now, we know this because when someone yells at us or tries to shame us, are you thinking, wow, this person is so right and I better go do what they're telling me to do, said no one ever.
And so if you're a parent, just notice. And I'm a parent too, and I'm not making you wrong, but this is why yelling at our kids don't work, even though we really want it to. That's a whole other discussion.
So repeat after me, feeling shame about yourself will not actually be a driver of positive change. That being said, this is what happens to most of us when we feel bad about ourselves and we feel shame, we basically try to do whatever we can to stop feeling bad about ourselves.
Or we do something to displace it. We do something else, we get a drink of wine, we watch Netflix, eat a cookie, scroll on Facebook. And the thing is avoiding it or try and do something else doesn't actually make that feeling of badness go away. Only temporarily, right?
And so like I said, I see so much shame around money, specifically in women. I also want to say that we as women are particularly prone to shame. And so the question might be, so what exactly is a driver of positive change or behavior?
It's focusing on the behavior versus the self. Remember what I said earlier, that shame is focusing on you, like there's something wrong with you, I'm bad, versus focusing on the behavior.
And so what if there's actually nothing wrong or flawed with you? Because there isn't. And what if the only thing that's happened is that you took some actions, you did something that created a specific outcome. And then now you get to decide if you want, did you like that outcome? Did you like that action, that behavior that you did? And would you like to do something differently?
And I'm going to keep saying this over and over again, because feeling bad about yourself isn't going to suddenly motivate you, it actually does the exact opposite. Now, one of the things that I want to tell you just about my journey is, like many of you, I definitely just habitually go into feeling bad about myself.
And even though I had come to the point where I knew this wasn't helpful, I had this thought that if I went the opposite way, meaning if I was feeling good about myself to change my behavior in a positive way, that would be being delusional, grandiose, and even narcissistic.
And I've actually talked to enough people where I think this is actually pretty common. And one thing I want you to notice with what I just said is that is an example of what we call all or none or perfectionistic thinking. Meaning that we go to the opposite poles. So we're like, oh, it's not good to feel bad about myself, but feeling awesome about myself is is bad too. Or that's just making me delusional or whatever.
So here's what I've learned, the key to actually creating positive change is actually to feel good about yourself, even great. And if you're not used to that, or if that idea just sounds so foreign or just delusional, that's okay. But why don't you just start with feeling less bad about yourself? A little better about yourself. So I just want you to start there.
Now, one of the things Brené says about shame is that shame thrives on silence, secrecy, and judgment. And do you notice something about these three things? Money fits all three, right? We don't talk about money, it's taboo. And because of that, there's all this secrecy around it. So it's like, how are you supposed to learn about something that nobody wants to talk about?
Now, yes, I know there are books out there and you can learn about it, you have my podcast. But very few people talk about the money they make, how they spend it, like give you like a P&L of how they spend their money or what they actually make. And we just make judgments about what we think people make and how rich they are based on their external circumstances of wealth, right?
So if they have a nice car or a nice home, we just assume that means they're rich. It could mean that, but it also could just mean that they spent that money and it could be spending beyond their means, right?
And then the last thing Brené said about what shame thrives on is judgment. And how many of us judge ourselves, judge other people about their money? How much they make, how they spend their money. I mean, there's just so much freaking judging going on when it comes to money.
Now, I do the same thing too. Being human, you're always going to judge. But we always have a choice on whether we want to keep that judgment and whether we actually want to carry out that judgment, right? And so, obviously, the antidote to all of this is we need to talk about money. We need to be open about it. We need to be able to talk about our salaries.
I remember my first salary job as a physician, I think it actually said we weren't allowed to talk about our salaries with other coworkers. That's just ridiculous, I also think that's technically illegal. And so I just think it's so silly for the medical profession because a lot of the ways that we get paid is relatively standardized, right? So that's a whole other discussion.
But anyway, so it's like how are we supposed to know if we're getting paid how much we should be getting paid if we don't know what other people are getting paid? This type of secrecy around how much money we make contributes to the gender pay gap. And just the fact that we don't talk about it, perpetuates the shame.
And so as Brené says, shame cannot thrive when shame is talked about. And so the more we talk about money openly, the less shame, badness, judgment around money that we will have. And here's the thing, when we carry that shame, when we think we're the only ones feeling bad about whatever is going on with your money or other area of your life, and we just carry that in ourselves and don't talk about it, it actually grows the shame.
And so I'll tell you, one of the things my clients inside my program, Money For Women Physicians, tell me all the time or even on the live calls is just hearing that other women like them have the same exact money concerns. Meaning we're talking about their money concerns, the badness, the shame, et cetera.
Just speaking about it and seeing someone else speaking about it, it just normalizes all of our money bullshit and it shows them and shows you that you're not alone. You're not the only one with these problems. You're not the only one who thinks this way. You're not the only one who feels stressed out about money or embarrassed that they feel stressed out about money. Or embarrassed that they don't have a handle on their money despite making a high income. And I will tell you, that alone is so freeing.
So that's what I have for you today. All about shame, all about money shame, feeling bad about money. And the antidote is actually to talk about it with someone else, not just in your head, but talk about it. We need to talk more about money.
Women need to be able to speak freely about money and not be judged for it. Because a lot of us want to actually talk about money, we would love to ask someone about money. But we feel afraid of what they're going to think or what other people will think if we ask about it. That's why money is taboo.
And so if you've been thinking about joining us inside of Money For Women Physicians, I invite you to join us. And I invite you to bring all of your money shame, let's get it all out there in the open where we can dissolve it. This is a space where we don't judge. You'll make new decisions, you'll take new actions, change your behavior and move towards whatever money goals that you have.
All right, I will talk to you ladies next week. Don't forget to buy a copy of my new book and join us for that live virtual book club. Go to wealthymommd.com/live. Take care.
Hey, if you're ready to create wealth I want to invite you to join my program, Money For Women Physicians. You'll join a community of like-minded women physicians who are committed to creating wealth. Just head over to wealthymommd.com/money to learn more.
Get started on your journey to wealth by getting my FREE book- Defining Wealth for Women.
For media or speaking inquiries please click here.
For all other inquiries please click here.
92: Women, This is Your Brain on Money
I recently gave a talk at a physician wellness conference, specifically for physician coaches. So for this week, I’ve adapted what I shared in that live talk for the podcast, and it serves as the perfect manifesto for my why behind the work that I do, and behind my new book Defining Wealth for Women.
How much money do you want to make? For this episode, that question is going to be front and center because once you’re clear on what you want to achieve, I’m showing you everything that’s standing in your way, why it seems so out of reach right now, and how to start overcoming all of it.
Tune in this week to discover why making money and practicing medicine on your terms seems so difficult in this moment, and what your role is as a woman in creating change and normalizing making serious money.
If you’re ready to challenge your beliefs, completely transform how you think about money, and get excited about making a lot of it, I’m inviting you to join me for my virtual book club Defining Wealth for Women Live. There are going to be eight live calls, each coinciding with a chapter of my new book Defining Wealth for Women: Peace, Purpose, and Plenty of Cash.
What You'll Learn from this Episode:
- Why I decided to become a coach and help physicians make more money.
- How our brains naturally get in our way when it comes to making a lot of money.
- The 3 things your brain is naturally motivated by.
- Where our historical socialization as women has us believing insidious messages about our ability to handle money.
- Why now is the time to make a change and start what I’m calling the Women’s Wealth Revolution.
Listen to the Full Episode:
Featured on the Show:
- Learn more about Money for Women Physicians where you’ll learn the tools to create wealth.
- Follow me on Instagram
- Get my new book, Defining Wealth for Women: Peace, Purpose, and Plenty of Cash
- Kara Loewentheil
Welcome to The Wealthy Mom MD Podcast, a podcast for women physicians who want to learn how to live a wealthy life. In this podcast you will learn how to make money work for you, how you can have more of it, and learn the tools to empower you to live a life on purpose. Get ready to up-level your money and your life. I’m your host, Dr. Bonnie Koo.
Hello, hello. So this is the first episode I'm recording in the new year, that's 2022. Kind of crazy, right? And I just want to warn you guys that I have a lingering cough, the whole family has COVID. Well, Matt hasn’t tested positive, but I'm assuming he will any day now.
So you might hear me coughing. My editors have their work cut out for this episode. Hopefully, they will edit out most of the coughs, but you've been warned. Also, obviously, my voice isn't 100%. And so we're just going to roll with it.
So this episode is coming out right after my book, Defining Wealth For Women, is available for purchase. And so if you're on my email list, or if you follow me on social, specifically Instagram, which is @wealthymommd, you have been seeing all the buzz around the book. And you may know already that the book is out.
But if you don't, now you know. And you can buy it in hardcover, paperback, Kindle, and hopefully the audio book. The audio book is ready, however, my publishers told me that whether it's actually available on January 11th is kind of up to Audible and Amazon. But it will be available very soon in case it's not available when you're hearing this podcast.
Okay, so what I want to do today is actually kind of tell you about the talk that I gave at this physician wellness conference that was specifically for physician coaches back in November in California. And so I'm basically going to do the talk in podcast form.
And the reason why I want to do it this week– The talk was called Women, This is Your Brain on Money, because it's kind of not even just a great summary, but kind of a manifesto for why I do the work that I do and why I had to write this book, Defining Wealth For Women.
And so I have a question for you, and so if you're listening to this driving, definitely don't get out a pen and some paper. But you can definitely answer this question while you're doing whatever you're doing in case you can't sit down and write it down.
So here's the question, how much money do you want to make? I really want you to take a moment and think about it. And so your answer is obviously a number. And I want you to say out loud, “I want to earn X amount of dollars.”
All right, now that you know how much money you want to make, go make lots of money and have lots of fun, that's my talk. Okay, obviously, that's not just my talk. But seriously, what gets in the way of you making lots of money? Why does it seem so hard? Why does it seem so out of reach?
And simply it's because our brains, your brain is not designed to make a lot of money. And so this is why I trained to become a coach, specifically a coach that helps you, my clients, to understand how their brains work. Specifically, the thoughts they have, the sentences in your brain.
And if you're wondering what sentences, those sentences. The one that just said, “What sentences is she talking about?” Also, you have to understand that you and I, we, we have grown up in a society, a world that has relatively fixed beliefs about money.
Now, if you've been following me for a while, you probably know that I talk about how our brain’s number one priority is to not die. Meaning it's to keep you alive. I mean, that makes sense, right? Our brains are primarily obsessed with survival. And just like zooming out and looking at the human race, it's done a pretty good job, right? I mean, hundreds of thousands of years the humans have been alive. So I think it's a pretty good idea that our brain is obsessed with staying alive.
And it sounds logical, except it will do this at the expense of many things, including wealth, including even happiness. And that's because our brain is primarily motivated by three things, also known as the motivational triad to ensure our survival. And so the three parts of this triad, like imagine a triangle, is one, it wants to conserve energy or be efficient. It wants to avoid pain, and it wants to seek pleasure.
And so depending on what you believe to be true about money, your brain will categorize money in these three ways. So let's kind of go through each of the components of the motivational triad. Number one, conserving energy or being efficient.
So most of us were raised and led to believe that money is hard, or some form of that. Or that money is complicated. So it kind of makes sense that our brains have no interest in dealing with this. Because doing so will require lots of energy. And our brain wants to conserve energy in case something really bad happens.
Now usually I give the example of a lion attacking us in the caveman days, but I'll give you a much more modern example. And we're not going to talk about politics, but I'm going to use the example of you hearing a gun being shot.
So having enough energy to run to act is really important. And so keeping in line of things being efficient, your brain wanting to conserve energy, simply there's no evidence that you spending energy required to learn about money, there's no evidence it's going to help you survive.
And how does it know that? Because you've survived so far without having to learn this material. Because remember, your brain wants you alive. I didn't say your brain wants you to be happy, fulfilled, et cetera. You're alive and so your brain is like, well, we haven't needed it this far to stay alive. So is it really that important? And I don't want to deal with this. That’s basically what it says.
In other words, your brain is really lazy. One more thing, so many of us believe that money is created or earned from some permutation of time and effort. And so, well, that sounds like a lot of work and your brain is like, “No, thank you.” And in case you're wondering, what? It doesn't come from time and effort? No, it doesn't.
All right, the second part of the motivational triad is to avoid pain. Physical pain and also emotional pain. And so if you're listening, you're probably a high achieving professional woman, and we are deeply afraid of failing. And so when it comes to money, this means losing money. And the thought of losing money, the thought of trying something new, investing in something new, and the potential of losing money is very not exciting to us, right?
It's kind of we're all scared about that. And so we might lose all of our money if we do something new. And that is definitely a threat to our survival. Money, in many ways, kind of elicits a primal fear in many of us because it is tied to our survival. And many of you likely believe that you need to suffer a little or a lot to make more money.
All right, let's move on to the last part, seeking pleasure. So for many of my newer clients, they're surprised that our brain is motivated to seek pleasure. But it needs to be, because you need to eat to survive. And so there needs to be a little bit of pleasure associated with eating. It only becomes a problem when you overeat to seek over pleasure, right?
The same thing with having sex. Procreating is really important to keep the human race alive, right? It's like the survival thing is not just about you, it's about the human race in general. And so a little bit of pleasure is necessary to do the things that ensure our survival.
And so our brain is always sort of scanning for what might be pleasurable for us, right? We want that little squirt of dopamine, basically. And generally speaking, anything you do to learn about money, to take some action, investing, et cetera, does not provide that sort of instant gratification, or that instant dopamine hit that our brain is looking for. Pretty much any effort you put in to learn about money, to make money work for you involves some delayed gratification, at least time wise.
So I just kind of gave you a quick rundown as to why your brain really is not designed to make money on default. Also, we, as women as a whole believe that we are not good with money. This is not an accident, nor is this true. Who do we have to thank for this? The patriarchy.
We couldn't own property. We were basically considered the property of the man that we married. And this is consistent with all of the countries in the world, although there are some, you know, more progressive countries out there.
And in fact, in the US it wasn't until 1974, which really wasn't that long ago, where a woman couldn't open a line of credit or get a loan without a man’s signature. That's mind boggling to me. So is it any wonder that today, many of us women carry the belief that we're not good with money and that we can't trust ourselves with it?
And the data shows that in married couples, heterosexual couples anyway, the man usually handles the money. But there's more, women are also socialized to not want to deal with money, starting from when we were little girls. Meaning there are insidious messages and some more outward messages that girls get about money.
Now, obviously I'm generalizing here, but pretty much from early childhood boys are getting the message that money equals power and that they should want to create wealth. It's encouraged, right? Now, listen, men have their own battles to deal with. They have a lot of pressure to have money, right?
Meanwhile, girls are getting messages about needing to control spending. And there's a much more higher focus on saving money versus creating wealth. And even if you just look at the types of words, the language we use to even describe things for women, like we go shopping and we splurge. And there's this general sense that we need to exercise self-control or self-restraint about money.
And even just zooming out, I'm talking about money, but in general there's this the patriarchy is kind of concerned with exerting control over women as if we can't control ourselves. I mean, that's a whole other story in terms of sex and lots of other areas of life. So basically, as women, we have been basically seen as not being able to do anything right in the eyes of other people or society.
For example, we all know that we are judged way more harshly than our male colleagues at work. Whereas the same behavior in a woman will be perceived negatively but will be praised in a man. We’re seen as bossy, whereas a man is seen as a great leader. And that's why women are often afraid or timid about negotiating for more money, because women are basically seen as greedy when we do this. Whereas a man is just sort of asking for what he wants.
Also, women, we often feel that we need permission. That we need a legit good and charitable reason to want to have and make a lot of money. Newsflash, you don't need a good reason. Simply because you want to is good enough. And that really goes for anything.
Now, side note, just because I know this comes up so much for the women that I know, just think about how women are often asked, if they don't have children, why don't you have children? And so many women who don't want children, for whatever reason, they feel like they have to justify why. Because the overall societal belief is that women should have children. That's just another example of how there's all this pressure and expectations of women in society.
The last thing I want to say about this is that there is a lot of what we call zero sum thinking when it comes to how we think about what we're able to do. For example, for those of you who are moms, society tells us that we should be good mothers and that should be the number one priority. And a lot of us get the message that good mothers don't work, let alone become doctors.
Now, this doesn’t obviously apply to everyone, but I definitely know that depending on what culture you come from, and this definitely seems to be the case in Middle Eastern and even East Asian cultures, you are definitely not being a great mother if you're pursuing a high powered career. And so, so many of us have believed that we can't have it all.
Many of us believe that in order to have a successful career, it will be at the expense of something, and that something is going to be your family. So a second newsflash, you can be great at your career, whatever that is, whether you're a physician, a lawyer, or some other professional. You can be a good mom and be rich all at the same time. It's not either or, it's and.
So by now you've kind of heard all the reasons why it's been so hard for many women to have and create more money. And so you might be wondering now, why should I care about this? If you already don't, hopefully you do and you're getting a little riled up here like I am. Why should you want to do something about this?
And here's why, and this is a quote from one of my teachers, Cara Loewentheil, and she is a feminist mindset coach. And this quote that she said, it just gets me all fired up. And so I'm going to read it to you. “When women are hesitant to make money and create wealth, they usually do not understand that by opting out of the game, they are insuring it continues to be rigged against them.”
Now, I'm going to say it again, but make it a bit more personal. When you are hesitant to make money and create wealth, you usually do not understand that by opting out of the game, you are ensuring it continues to be rigged against you and other women. And so it always starts with the individual.
So many of us complain, lament, or are even apathetic about the system. I'm putting this in quotes, you can't see me. The system that's preventing you from being rich. And this is especially true for women of color, right? But here's the thing, systems are created by people. And so the way to change the system is to start at the individual, and that starts with you.
Meaning you need to challenge your beliefs about money. You need to go out there and dare to be rich. You, we are the women who are going to pave the way so that it soon becomes normal for women to be rich, and not just have the Forbes 100 or whatever those rich people lists are be predominantly white men. This is the only way for change to happen, for change to scale. It starts with you.
So my question to you is, are you going to be a part of the change or not? I know I am. And this is why I wrote this book, this is why I do this podcast. Because I'm here to create, to lead, to be a part of the change of what I have called a woman's wealth revolution. And so I'd love to invite you to come along to be a part of this. To be one person that contributes to change. To be that one person that helps change the system.
And so if you're listening to this in early January, then I want to invite you to participate in Defining Wealth For Women Live. And this is basically a one month experience, event, virtual book club that goes along with my book. And so the way it's going to work is there are going to be eight live calls. And each call is going to coincide with a chapter. So there's eight chapters, obviously.
We're going to have a pop up Facebook group, and all women are encouraged to join. And I want everyone to get super excited about having and making a lot of money. I want all of you guys to start challenging your beliefs about why you think you can't have money and let's get going. Let's all make lots of money in 2022 and beyond and show our daughters and all the women coming after us that this is possible for them.
All right, well I will talk to you ladies next week.
Hey, if you're ready to create wealth, I want to invite you to join my program, Money For Women Physicians. You'll join a community of like-minded women physicians who are committed to creating wealth, just head over to wealthymommd.com/money to learn more.
Get started on your journey to wealth by getting my FREE book- Defining Wealth for Women.
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Did you know that you can invest in other things besides stocks and index funds inside of your retirement accounts? How about gold or real estate? These alternative types of investments can be inside tax-sheltered accounts such as your Roth IRA or even solo-401(k). For this post, we will focus on self-directed 401(k)s, but similar principles apply to any other self-directed retirement account.
They are called self-directed because you direct the investments. You open a self-directed account at a custodian that allows them. These custodians are not companies like Vanguard or Fidelity. There is a long list of possible custodians, and I will discuss the one I went with.
Why should you consider opening a self directed 401(k)?
Since the Jobs Act of 2012, real estate syndications and crowdfunding are becoming popular investments. They offer the diversification of real estate without the hassle of direct ownership.
They come in two major flavors: equity and debt investments. Equity investments are where you own a share of the investment along with other investors. You reap the benefits of appreciation.
Conversely, with a debt investment or debt fund, you are loaning money so that other people can buy real estate. Returns vary but can typically range from 8% and up. However, these returns are taxed at your marginal tax rates unless you invest in a tax-sheltered account. This is a perfect scenario for opening a SD-401(k).
You can invest in actual properties inside SD-401(k)s, but for the most part, it is generally not recommended since directly owned properties have very favorable tax treatment.
So which custodians should you consider? There are dozens of self-directed custodians. Through my research I discovered a very unique product that I ultimately decided to go with.
Introducing the eQRP
The eQRP is a customized retirement program that gives you the freedom to invest in alternative investments such as real estate (direct properties, syndications, debt funds), precious metals, notes, oil & gas, including being a hard money lender.
Two things that are totally unique to the eQRP is ERISA protection and checkbook control. ERISA stands for the Employee Retirement Income Security Act of 1974. In short, it ensures certain protections to the account including from creditors. A regular solo-401(k) is not ERISA protected!
Checkbook control means exactly how it sounds–you can write a check from your eQRP account to purchase assets (or more likely via direct wire or ACH transfer). With an eQRP there is no middle man, you are in total control of your account.
It was very easy to set-up. So far, I have invested in a syndication deal with Alpha Investing, who I currently invest in for real estate syndications. M opened an eQRP as well and we plan to use his to start purchasing rental properties.
To find out more about eQRP and if it's right for you, click here to find out more.
Let me know if you currently have and love your self-directed custodian!
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