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Joy today: College for all

I’ve been thinking a lot about the college cheating scandal. As a poor kid, higher education was the ticket I chose to build a better life for myself as an adult. I worked incredibly hard in high school and I was so fortunate to have an amazing guidance counselor.

My college tuition was more than my mother’s annual salary. I am forever grateful to Penn that they had need-blind admission and that they had (and continue to have) a guarantee to meet 100% of a student’s need through loans, grants, scholarships, and work-study.

I worked 3+ jobs all through college. It was tremendously difficult to be a student who struggled financially in a school full of privilege. That shame left a scar that took years into my adult life to heal. I’ve learned to be proud of those scars; they show what I survived.

Now w/ college 20 years in my rear view mirror, a graduate degree from the Darden School (another wonderful school), and currently enrolled in a second graduate degree in biomimicry at The Biomimicry Center at Arizona State University. I understand the pressure to get into a top school and the opportunities it affords.

What’s most tragic to me about this college cheating scandal is how many students there are today who are in the same boat I was in at 18 years old. How many spots were taken from them at these colleges by people who had parents pay their way in? That loss is what hurts most.

My great hope is that this situation will lead to greater equity in higher education. I’m living proof that it is a path to a better life, and it’s an opportunity that should be open to all who are willing to work for it, regardless of the financial status of their parents.

A Year of Yes: The zen of taxes

This weekend, I’m preparing my taxes and grateful that I’m able to do so. I received assistance from government programs as a kid via the WIC program and the free lunch program. I went to college and graduate school with the help of students loans and government grants. Now on this flip side of life, I’m glad that I can pay forward this money to kids and young people who need those same programs to build a better life.

I know that there are parts of our government—local, state, and federal—that are inefficient and don’t spend money well. I also know that there are programs funded through taxes that change lives. I’m living, breathing proof of that. So while taxes can seem like an unwelcome chore, today I’m focusing on all the good that taxes do in my city, my state, and my country. This is the zen of tax preparation, and I embrace it.

In the pause: Don’t let money run the show. At least not at the beginning.

On Friday, I was talking to a friend about a new business she’s thinking of starting. She reached out to another friend of hers to ask for advice. Though she has a lot of passion for the idea, she wasn’t sure how to monetize it. Her friend, a very successful entrepreneur in the financial services space, said, “Don’t worry about monetization right now. Just build what you want to build.”

That might sound like odd advice, especially from someone who works in finance. Aren’t we taught that to build a business we must think about bootstrapping or raising capital and an exit strategy? Doesn’t it all start with how to get money in and then how to get your money back out? This is where a lot of ventures fall down – they worry so much about the money at the start that they lose sight of why they’re building a business in the first place. It starts with passion and heart.

At the beginning of a business idea, you’re experimenting and testing. You’re trying to figure out what you can do and who you can help. To do that, you build the smallest possible piece that you can with as little money as possible for a very small number of people. Go ahead and dream big, but build small. You don’t need to save the whole planet in the next hour. All you need to do is make one thing better for one person. That’s the seed. Start there and see where the path leads. Stay curious. Stay hungry. Stay alert. Pay attention. Listen. Try, fail, and try again. Right now, that’s the only work you have to do.

In the pause: More data on our national economy

As a follow-up to my post a few days ago (Leading Economic Indicators We All Need to Watch), I had a conversation with one of my former business professors. I wanted to get his perspective on my concerns and about the economy to see if there were other indicators I should be watching. He mentions a few here and details some of his very real concerns as well. He is someone who constantly watches the global and national economy, as well as the stock market, so I trust his advice, guidance, and thoughtfulness. I hope this is helpful to you as well.

“Christa:

Nice to hear from you!

Like you, I’m feeling a bit uneasy about the stock market right now. Very high P/E multiples. To justify those prices will take an extraordinary breakout of growth in the US (and world) economy. The saving grace is that the financial industry still looks fairly stable—bigger capital bases than in 2007, more conservative lending, etc. If there is a downturn in the next year or so, I don’t think it will have the force of 2008. But still, a downturn is a downturn and something to be prepared for.

Your blog post offers some very good advice. I encourage people to keep 12-18 months’ worth of living expenses in fairly safe and secure investments. And I remind them of the old adage that there are two ways to be rich: one is to have a lot of money; and the other is to have simple needs. Avoid running up debt balances (except for education and a home mortgage). And the most important asset one has is between one’s ears: keep learning so as to stay valuable to your employer—that’s the best defense against a layoff.

Hope these comments help.

Be well.”

 

In the pause: Leading economic indicators we all need to watch

Buried deep in the Business & Finance sections of media channels, there are some leading economic indicators that we all need to watch. I have to admit that I’m getting very nervous. I’m beginning to feel like it’s 2007 so I’m making plans with my money. You’ll find a mini-action plan at the bottom of this post. I hope it helps. Please feel free to share this post with anyone whom you think would be interested. I don’t have a crystal ball. This is just what I’m seeing, reading, hearing, thinking, and doing. I put links below for you to reference:

  1. Executives at Wall Street’s largest banks are dumping stock, and I mean dropping shares like they’re hot potatoes. They have sold nearly $100 million worth of stock since the election. And it’s not just some of them. It’s all of them! Bankers dump stock because they think now is the best deal they’re going to get for a good long while. They’re smart as hell when it comes to these kinds of predictions so pay attention to them. Yes, the Dow hitting 20,000 is a big, flashy story. But honestly, that’s all it is. Don’t think that means good times are ahead. The Dow is going to seesaw like it’s on an elementary school playground for years to come. In July 2007 the Dow hit a record 14,000 and then it plummeted to 6,547 in March 2009. Those were dark times filled with panic. There is a high degree of volatility in our economy right now, and by all accounts that volatility is going to continue to a frightening degree.
  2.  Emerging markets are selling debt at record numbers. Argentina’s finance minister explains why in an interview with the WSJ: “Nobody knows what’s going to happen to U.S. interest rates with Mr. Trump as President. We have to reduce the level of uncertainty that there is now. The right decision is to minimize financing risks.” Again, finance ministers in foreign countries are seasoned professionals who spend their waking hours watching economies and policies. This is all they do, so when they make statements like this, it’s very significant. We need to listen to them.
  3. Contrary to all of the hoopla from the West Wing this week, American corporations are not investing in their businesses. They are stockpiling cash to the tune of $1.9 trillion, the most cash they have ever held. Ever. This isn’t rainy day savings. This is flat-out hoarding. Why would they do that? The same reason you would stockpile cash—because they are worried about what’s ahead. By having cash on-hand, they will be able to make adjustments and survive. In a difficult economy, cash is life (literally!) Accountants and finance professionals help companies manage and hedge their risk. Again, they know what they’re doing.

Look, I have no desire to relive those frightening years of 2008 – 2012. They were awful. But please understand that in the case of global economics, there is very little that ordinary individuals like you and I can do to impact this outcome. This is an issue that is truly in the hands of fiscal policy makers and elected officials. Trump’s volatility and foreign policy decisions will move markets. I wish that weren’t the case, but it is. So here’s what I’m doing to protect myself:

  • Increasing my cash savings. I’m still savings for retirement in my 401K and IRA, but I’m not making any significant purchases that will put me behind the 8-ball financially. I have a lot of friends who bought houses, cars, and the like in 2007 just after we graduated from business school. Some paid dearly for those decisions for years. I have an emergency fund if my job evaporates or I have a medical emergency. Liquidity will be the name of the survival game if our economy goes belly up again like it did in 2008.
  • I’m continuing my side hustles as a freelance writer and I don’t spend any of that money. I save it. The extra income really helps.
  • I have a plan if lose my job tomorrow. I know it is scary to think of things that way. I know it isn’t optimistic. I know it sounds like Doomsday is on our doorstep. No one wants to think about this. But we must. Please. Just have the plan ready to go, and then get back to work.
  • Now is the time to up your skills and make yourself more marketable. I’m now thinking of ways to do that through volunteer work and free or low-cost trainings. Now’s the time to break out our jack-of-all-trades game faces.
  • If you are in a job that looks shaky now, I would strongly encourage you to look for a new job and get out ahead of the storm. If your company is unstable now, it will only get more unstable with a rocky economy. Don’t cross your fingers and hope everything will work out alright. Now is not the time to preciously cling to feeling badly about leaving your company, or your boss, or your coworkers. The only one who’s going to make things alright for you is you, and remember a company will protect its own survival before it protects your job. When their backs are up against the wall, people become line items. I know that’s painful to hear; it’s also truthful. I watched 10s of 1000s get laid off from my company from 2008-2012. It was harrowing. I still feel sick about that time. Companies are survivalists so we must be, too. Take care of you.

I wish this were a sunnier post. I wish like hell that I had great news for you when it comes to the economy. But listen, knowledge is power and protection. I would be delighted to be completely wrong about all of this though I’m of the belief that it’s better to have a plan you never need rather than needing a plan you never have.

And if you need help, please let me know. I am not a finance expert by any means so please don’t take this advice as such. I do read a copious amount of information on a daily basis in dozens of channels. I try to stay as informed as possible on a wide variety of subjects. As I learn and understand more, I will of course share it. Together, watching out for one another, we are stronger and more resilient. If last week is any indication, we’re in for quite a ride for at least the next 18 months until the midterm elections. At least we’re all in the same boat. Now let’s row in the same direction.

Wonder: What I wish I could tell my 20-year-old self

On Saturday, my friend, Chris, and I went to look at a house I’m interested in buying. We were sitting on the porch waiting for my wonderful agent, Yo-G, to arrive to show us the house. Chris and I grew up in a similar socioeconomic situation and we started talking about how lucky we both are. Our educations literally saved our lives, and the road wasn’t easy but it was worth it. For me to even sit on that porch with the possibility of making an offer on it is a dream come true. I feel the same way when I go out to eat, take a trip, or even pay my monthly bills. While it sounds simple, I’m glad I’m able to do all of that and still save for my future. For so long, that felt out of reach.

I wish I could go back and tell my 20-year-old self that everything’s going to be fine, that eventually after a lot of hard work and hardship life would get easier, less stressful, and be fulfilling in so many ways. I wish I could save her the sleepless nights, constant worries, deep depression, and intense fear that plagued so much of her college years into her 20s and 30s. I guess that’s why I’m so intent now on mentoring and helping young people. I can’t go back and save myself that stress, but I can help others who are on the same path. I can let them know that with determination they will be ale to build a life they love. And the difficult path certainly has an upside – it made me so grateful for what I have today.  I’m glad I got to see the world from my view now, and I’m intent on taking other people with me while I rise.

Wonder: Getting my health and wealth in order thanks to Fidelity

Yesterday, I attended a lunchtime webcast about health and wealth for personal and professional reasons. I want to make sure I’m doing everything possible to take care of my finances and my health. It was run by Fidelity and featured personal finance journalist Jean Chatzky and Dr. Mike Roizen from the Cleveland Clinic. It was incredibly helpful so I wanted to share the highlights that they sent in a presentation at the end of the webcast. I hope it’s as helpful to you as it was to me.

fidelity_health_and_money_webcast

 

Wonder: Telling stories takes you back in time

I’m working on a piece of writing for my dear friend, Amanda. She’s the best editor I’ve ever worked with, bar none. Whenever she asks me to write something for her, I jump at the chance every time. This particular assignment involved traveling back in time to the dark days of September 2008 when the world, my career, and my life was turned upside down by a frightening, unprecedented economic recession. I was working for a financial institution, an industry I swore I’d never join, and I was, in a word, terrified.

Rather than cower and hide, I rose up. To this day, I’m not sure where I found the strength. I guess the fear of losing my job and my livelihood was adrenalin for me. I took that energy that gets wasted by fear and used it to drive me forward, headfirst, right into the abyss of the unknown. I still shiver thinking about it. And then I smile. Time travel is a wild ride. We are so much stronger than we think we are.

Wonder: A wrong righted 10 years later

 

10 years ago, I interviewed at a large retail company for a summer internship while I was an MBA student at Darden. It was my top pick for an internship and I was proceeding well in the process. The final step was a psychological evaluation that was supposed to be a formality. Instead, the psychologist dug into my family history for over an hour. She asked me a lot of very painful questions and was very judgmental about my childhood. I stood my ground, told the truth, didn’t crack, and stated how I did the best I could in the circumstances I was born into. I didn’t get the internship, and I was heartbroken. I thought the story was over, but it wasn’t.

A few months ago I received a letter from a law firm. A class action lawsuit was filed against this retail company for discriminatory hiring practices. The HR records had been subpoenaed and unsealed, and it was deemed that I may be due a payment for damages. I confirmed that I interviewed with the company during the time period in question, sent the letter back, and never gave it another thought.

When I arrived home yesterday, I had a letter from the law firm.The retailer confessed to its discriminatory practices, and settled out of court. The letter contained a check for damages. Not a huge check, but one that I can put to good use. I was shocked. I’m still shocked. I actually cried a little. And then I cried a lot. Not out of sadness, but out of relief.

I didn’t realize how badly I’d felt about this incident all these years. When you grow up without enough, you think you aren’t enough. It is a painful fact of growing up poor. And as much as I have grown into a strong, resilient, and confident woman, there is a small part of me who still carries around this slightest feeling of shame. I’ve learned to use it to go further, try harder, and reach higher.

That incident 10 years ago with the retailer brought all of those feelings into clear focus. I wasn’t mad that I didn’t get that internship. I was ashamed and deeply embarrassed because I knew that my family history made them turn me down. I was told I wasn’t good enough because I hadn’t grown up with enough. How hard I had worked for so many years to lift myself up didn’t matter to this company. And in fact it was a black mark against me.

So getting that check yesterday was a nice thing financially, but that is such a small benefit compared to what it means to me on a much more profound level. That is karma. That is the universe righting a wrong. That is the reward of standing tall, and not letting small-minded people get you down. That is proof to me that our authenticity, work ethic, and determination to making meaning of our past does get rewarded. It can take time. It can often take too much time. But it happens. It happens.

Wonder: Looking for a home in D.C.

That’s it. I’m buying a home in D.C. After investigating my rental options, I discovered that buying is both less expensive and makes better long-term financial sense. In some ways it’s scary to put down these kinds of roots. In other ways, it’s freeing and comforting. I’ve decided to not be afraid and to channel all my energy into the excitement of becoming a homeowner for the first time. It’s one of the main reasons I moved to D.C., and now it’s time to make it happen. I’m madly in love with this city and I’m so glad I chose to move here for a thousand different reasons.

I have an amazing agent (Sharif Ibrahim) and an equally amazing loan officer (Mark Eigenbrode). I hit the jackpot with this combination of real estate talent and knowledge. I’m lucky beyond belief, and I know it.

So here’s to finding a home this week and making an offer. That’s my big goal, and I’m going for it!

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