Throughout this podcast, you've heard Paula Christine talk about how her perspective as a financial coach is informed by her life experience. We are thrilled to announce her Making Money Matter program - a six week course to help you understand the basics of managing your money. In this episode, Paula sits down with our podcast producer, Jon Gay, to walk us through it.
Paula explains what's involved with each section of the course. New classes will post each Monday for you to watch on demand, and there will be a live Q&A each Thursday.
For more info on the course or working with Paula, visit https://www.paulachristine.com/
Or send Paula an email: paula@paulachristine.com.
Jon: Welcome in to Beyond the Paycheck. I am Jon "JAG" Gay. I'm the producer of the show. And Paula is here with us today to talk about her new course she's offering. And before we get to that, Paula, I know you've talked in this podcast about how your personal experiences have informed you as a financial coach. And that's the thought behind this whole making money matter course that you've revealed.
Paula: Right. I made so many mistakes as I was, uh, guess, maturing we'll say. And I wish that I would've known the stuff that I know today. I know hindsight's 20/20, but I wish I could go back and be 18 years old again with going to school and using a credit card for the first time.
And dating and getting married and starting in my career and start all that over again with what I know today.
Jon: You are preaching to the choir. If I, as an 18 year old college freshman, knew everything I knew now, boy, my college experience would've looked a lot different in terms of money and everything else too.
Paula: I mean, we all do. But we also know that when your parents should just say, well, you need to do this or don't do that. We did it anyway, because we knew so much more than they did.
Jon: Especially as teenagers.
Paula: Correct. Well, I think it even having five children of my own, I know that they're finally in their late, well, mid twenties to early thirties and they're coming to me all the time.
Mom, what do I do for this? Mom, what do I do for that? And so I thought, well, they don't know. And even though I tried to tell them, they still, and I was having a conversation with my son yesterday. He's like, Mom , I just don't understand this investing stuff. So I decided, well, let's make a course.
Jon: I think if anybody who's listened to the first dozen or so episodes of our podcast at this point, the beauty of the podcast is that it really explains things on a level that the everyday person, and by everyday person, I mean me, can understand. And so with this Making Money Matter course, let's break it down cuz it's a six week course that really gives you a one on one and really builds your financial knowledge for that stuff, that to your point earlier, Paula, we wish we had known when we were younger.
Paula: Yes, it does. So in week one, we're gonna look at what your money personality is. Let's ask you, Jon, are you an investor, a saver? Are you in debt? You know? What's your money personality? So we're gonna look at that and see,. If you're a saver and you save everything, that's great, but it's also not good.
You still wanna have a good life, but if you're somebody that uses your credit card to pay for everything, then you're in a constant battle to get out of debt. And that's not good. So what is your money personality? ANd what are your goals? Those are the first things we're gonna look at in week one.
Jon: I'm laughing because I've been married five years as of this month. And before I was living with my wife, I had a completely different money personality than I have now. Because before I got married, I was definitely a spender. Lived beyond my means, made every financial mistake you can make in the book. And my wife just happens to be a saver and really good with money.
And once we kind of got into a rhythm between the two of us, as far as cadence and agreeing on how we were gonna manage our finances, which by the way, is I let her manage the finances. I'm now more of a saver, but your point here is really important, Paula. The psychology behind why we do what we do is really the first step to understanding our personalities and our habits and why we are the way we are.
So in the first week you said, we're gonna find the money personality, find out what our money personality is. What's week two?
Paula: Week two is about managing your money. So we're gonna look at where your money is going first. We're gonna put together a budget. So I have a budget worksheet that you're gonna be able to download.
And we're gonna go through what is my income coming in? How much is going into savings, what are my expenses? And hopefully we get to the bottom of that and there's a surplus. But if there's not, and there's a shortage, then we're gonna have to figure out what you're gonna have to maybe cut back on.
Jon: That accountability piece is really so important because we spend more than we realize. And I think you and I have talked about this on a previous episode of Beyond The Paycheck. When my wife and I were long distance, I was in New Orleans and she was here in Detroit and I said, oh, I don't have much money left this month. I spend this money on plane tickets to come see you.
And she said, no, you didn't. You spent that money at Starbucks every morning. And I was like, no, not 10 bucks at Starbucks versus 300 for a plane ticket? And I went back and she was right. It was those little things that added up more quickly than I ever could have imagined. So creating your budget and it's so easy now, too, with being able to download your bank statements and we use plastic more than cash.
Most of us at this point. You can track your transactions. You can see what you spent on everything. There's nowhere to hide because when you're looking at it in front of you in black and white, it can be really eye opening.
Paula: Well, that's the second part of it is the tracking you need to track. You need to look and see if your budget for groceries is $500 for the month, and you spent that in the first two weeks, now you're overspending. It was funny. I was in the grocery store the other day, cuz everything is going up and I thought, am I gonna have to get my calculator out again and start calculating as I'm going through the grocery store? So then I don't walk up to the cash register and am I paying, you know what, I think I'm gonna spend a hundred dollars and I end up spending $150?
You're gonna learn how to track. And one of the other things we're gonna do is talk about how to get outta debt and that's huge. You've gotten yourself in debt. No judgment here. We've all done it. But how do you get yourself out of it?
Jon: Exactly. Okay. So in the third week after we cover the budgets in week two. In the third week, we're talking about insurance and this I think is so important, cuz this is an area that I always get stuck on. Have a hard time getting my head around.
Paula: Yeah. Health insurance, number one, everybody needs to have some sort of health insurance if you're buying it on your own or through your employer, but just understanding what it covers, what are the different types of policies. And then we're gonna look at life insurance. Do you need it? What are the different types of policies? Long term care and property and casualty. Do you have enough coverage if you were to get in into an auto accident or something were to happen to your phone? Not only do you have enough, but do you have the right coverage for what you need?
Jon: That is so important. What about week four?
Paula: Week four. Oh, fun topic investing. Which is really good to be talking about now based on what's going on, but we're gonna look at what is a stock? What is a bond? What is an option? What is a mutual fund? I'm gonna be as comprehensive as I can be about that topic. I'm not gonna go into full detail, but we're gonna do some learning the basics about investing.
Jon: And some of the important things about investing, especially for our younger listeners. The earlier you can start the better.
Paula: Yeah.
Jon: And I've learned this in recent years, the power of compound interest.
If you start putting just a couple bucks away in your early twenties, like I wish I did, that money is gonna gain interest and then that interest is gonna gain interest and so on and so on and so on. And you can really have a nice nest egg built up just by starting the whole process of saving and investing in your early adult life or even before your adult life. As you're working as a teenager in the grocery.
Paula: Correct. I just was doing a post for social media. I figured out if you saved $20 a week, starting at age 20, until your full retirement age. For most of us is 67. You'd have at a 10% return, I can give a whole bunch of past performance, blah, blah, blah.
But at average of a 10% return, you'd have over a million dollars at age 67, which a million dollars when somebody 67 may or not be enough for them to live. But it's a good start and that's like $20 a week. So how much were you spending at Starbucks?
Jon: Oh gosh, I was there, when I was living in new Orleans, I was probably there five days a week and I'd get a breakfast sandwich or an oatmeal and a drink. I was probably between $5 and $10 a day. So yeah, we're talking probably 50 bucks a week. That's way more than the 20. You're talking about putting away.
Right,
Paula: but you didn't know. I mean, you didn't know that you could invest that and that the compounding. I didn't know when I was 18, 19 years old either, but what if you can just change that part? How much better off you would be years down there road.
Jon: And the other thing about investing is I think it's worth mentioning, given how the markets have been in the first half of 2022, our natural reaction as human beings, our natural behavior is that fear response in the brain.
Oh, the markets are way down. I shouldn't be investing. I should be stashing the cash under my mattress or whatever, or in the backyard or whatever the cliche is, but I've also heard it described, and you can tell me if you agree or disagree with this. When the markets are down, stocks and bonds are actually on sale because you're getting them at a lower rate.
And then eventually as past performance would indicate, it will bounce back at some point.
Paula: Yeah. Who doesn't love a sale? I mean, when you think about it. I was talking to a friend today and they said they were looking to go on vacation and they were looking at the cost of hotels and different things.
And I think, and you're spending that much time planning your vacation. But think about what's going on in the market today and what you may be wanting to consider, because you're looking for prices there. Why are you not looking at the prices of stocks today and thinking maybe I should be invested something.
Jon: I forget where I saw this stat, but it rings true. Americans spend more time planning their vacations than they do planning their retirement, which actually leads us right into week number five of the Making Money Matter course. And that's planning for your retirement. Right?
Paula: Right. Everybody wants to retire.
A lot of us wanna retire earlier, hoping maybe can retire earlier. But what does that mean? Let's take a look at it. You may be 25 in taking this course and not planning on retiring for another 40 years. But if you can figure out what you're gonna need at that time and understanding the importance of the 401ks and IRAs and the Rothss and different types of investment accounts to get you to retirement, understanding social security is all about being intentional about your future.
And part of your future is planning for retirement. Back in the day, I remember when my my grandfather, he worked all of his life. He got a pension, he worked for the post office. Had his pension in his social security. And he pretty much could live on that. But that's not how it works today.
You're responsible for probably 80% of your retirement income and it's gonna come from your savings. Pensions aren't. For a few, there are still some out there, but they're not the norm. And who knows where social security's gonna be.
Jon: That's actually the question I was gonna ask you next, Paula, which is...so full disclosure, I'm 41 and I've heard, and I have read some stuff that social security could be cut back or in real trouble by the time I'm 65, 67 in 25 years and could be even worse for listeners in their twenties and thirties that are listening to the show. It seems like it's probably best to not be counting on that social security money for your retirement.
Paula: No. When I talk to people, especially young people today, I say, you know what, if you get it maybe it's your vacation money. Don't count on it. I mean, consider it a gift if you got it.
And I hate to be a negative Nellie, but you know, there's not enough people contributing. I don't want to get political. It's just something that I don't think that you should count on.
Jon: That's fair. And we can say that without being political that's for sure. We're just looking at the hard numbers of the situation.
Paula: Right.
Jon: All right. The last week of the course, the sixth week, we're talking about I like how you described this, the fun stuff, like taxes and estate planning. Go for it.
Paula: Yeah. Nobody wants to talk about either one of those topics we all know we're gonna die, but nobody ever wants to talk about what that looks like.
And if you have children, It's important that you think about that, that, that can happen to you. COVID's taught us a lot about unexpected death. So there's some things you need to do to protect yourself, to protect your family. And so we're gonna look at that in what your proper state planning needs are and then taxes.
Do you even understand how the tax system works? We're gonna look at your paycheck, so you fully understand what's coming out. Look at your tax return. So that you understand how that works. I mean, people think that if they make a hundred thousand dollars they're in the 22% tax bracket, but really nobody pays that 22% on that whole hundred thousand.
So we're gonna take a look at how that whole system works so that you can better understand your money.
Jon: That is something that I only learned recently was that different parts of your income are taxed at different rates. It's not that everything is taxed at the same rate. So that's really important to know.
Paula: Correct.
Jon: So to recap, all of the six weeks in the class week, one is finding your money personality. Week two is your budget and how to get outta debt, if need be. Week three is insurance. Week four investing. Week five retirement planning. And finally, week six taxes and estate planning. These classes, once you sign up, they're gonna be available on demand for you to watch when the time is right for you.
And then you're also gonna have a live Q&A right? Each week for the folks taking the class to ask you any questions about their specific situation.
Paula: Correct. So new classes will be launched on Mondays and then you'll have homework to do so it is kind of like going back to school a little bit, and then every Thursday evening we will have a live Q&A.
So you can ask any question that you need to, and to make it as personal for everybody's situation. Or you can talk about your personal situation, feel free to email me, and I will answer all your questions. My goal is just to educate you and I really need you to make the commitment to make this all happen for yourself, because I know sometimes I live in a Pollyanna world, but I just think if we can just change just one or two things someone's life that maybe we can make it just slightly easier for them.
Jon: I wish I wish I wish we'd been talking for the last 15 minutes about wishing we'd known then younger, the things we know now, and we're starting to see some legislation pass where it's requiring folks to take a financial literacy class in school.
But for the vast majority of us who have graduated high school at this point, but we never got that class. So this really is that chance for you to take that class. I'm not big on classes and homework, but when it's something that's gonna change your whole financial outlook and your future and give you a better grasp of this stuff that is so important to know that you didn't learn in school.
I can't imagine why you wouldn't sign up. Paula, what's the website for our listeners to find out more.
Paula: It is PaulaChristine.com. And if you want to email me any questions, you can reach me at Paula@PaulaChristine.com.
Jon: Again, we're gonna link all this in the show notes. The course is Making Money Matter.
The website is PaulaChristine.com. Thanks Paula. We look forward to getting started with the classes.
Paula: Thanks, Jon.