WMMD #3 Transcript
SPEAKER00: Want to make sure you set yourself and your money up for success in 2024? Keep listening to hear all about our financial to-do list. Hello, and welcome to the Wealth Minded MD podcast with your money best friends. I'm Dr. Lisha Taylor, and I'm here with Dr. Brittne Halford. And we're in the same room together. Yes, we're in the same room, although you can't probably tell from the video or from the audio. I forgot this is a podcast. So you may not be able to tell, but we can tell, and we're excited. And of course, we're here to help you build wealth and make good money decisions so you can create the life you desire with more control over your time. But before we get started, we got to pay some bills. Hey, Alicia, did you know that about one in four physicians experience some disability during their career? Yeah, you know what? It's so striking to me, the numbers of how common this is. In fact, that's what happened with Dr. Stephanie Pearson. She was this super passionate OBGYN physician at the height of her career, and then ended up having a shoulder injury during a precipitous delivery that basically shattered all of her dreams, prevented her from being able to practice medicine in the way that she wanted. She then was determined to make a difference for other females. And so she became a staunch advocate for her peers and helped guide them through the disability insurance process. She even teamed up with expert Scott Ravitz. They founded Pearson and Ravitz. It's basically this company that is determined to approach insurance differently. They're physician founded and physician focused, which is what I love about the company. Make sure that you visit PearsonRavitz.com today to schedule your consultation with a Pearson Ravitz advisor. All right. So this is our Life is Lifing segment. And as always, we're going to kick things off with a little sneak peek into our lives. Yep. So here on Life is Lifing, Alicia, I want to ask you to tell me what's going on in your world. But I know we kind of chatted already. And I just want to say that Life is Lifing because we're in the same room together. I know it's kind of awkward because like I'm trying to look at her because I can see her in the corner of my eye, but I know because the camera is like here. We should have like figured out how to strategically do this because now and people listening to the audio probably like you guys are weird, but we are trying to figure this out. Brittne flew into Atlanta. I got her to come to hot Lana, so I'm excited about that. And Brittne, you have ties to Atlanta. Why don't you tell the people what your ties are to Atlanta? Well, I moved here. after following my husband because I was tired of a long-distance relationship after graduation. So I actually had my first attending position at Emory and we spent two years here. Our first born, Brooke, was born here right at Emory Midtown Hospital. I did not know that. Oh wait, what year was your daughter born? 2018. I was going to say, did I deliver your daughter? So I did family medicine, and obviously that includes some obstetrics. And so I delivered some babies, and I was about to say, oh my god. Well, you would have remembered that. Yeah. You know, there was a black woman. She was a resident. She was a resident. Really? Oh my gosh. Wow. Yeah. Man. I'm confusing my kids, actually. That was KJ, that was KJ. All right, mother of the year over here. That was KJ, who was a black resident. I also had a resident, but she was a third year resident, but she was not a black woman. But she was a woman, and she did a fantastic job. I don't recall her name. Oh my gosh. But if you're out there, you did a fantastic job. Very, very, very good. Wait, wait, when was your son born? 2021. So I might have actually, was your son born at Emory Mental? No. Oh. We were in Boston. This was so unexciting. Why did we go here? Now I'm just so like. I'm so let down. Anyway, we got to get this is our, OK, this is kind of like life is life, but this is not what we plan. All right, so Brittne, what's going on with you this weekend besides coming to see me and throwing me off track? So I just got back from the White Coat Investor Conference, and I'm really excited about just the opportunity to talk about money and to brainstorm and strategize in a setting where there were other medical professionals. And it was not taboo. So that was that was really nice. I also presented. Yes. Congrats. Congrats. Congrats. How do you feel like you did? It was so good. I had my little jokes in there. Jokes. Oh, okay. We're comedians now. I got to hear this. I can't wait to hear the recording. I actually haven't heard it yet. So now the bar is set very high, Brittne. You told me that you're cracking jokes and making people laugh while talking about money. I got to hear this. It was really good. Of course, the nerves were there, but they eased and I got some really good feedback saying that I looked confident, people participated, so I added in like Turn to your neighbor and ask them, yes. Oh, we're speaker 101 right here. We are. Actually, that's more like 201. We're turning to our neighbors. You know, I always get confused when people do that. Have you ever been sitting in church and they're like, turn to the neighbor on your right? And you're like, well, the neighbor on my right just turned to the neighbor on their right. So I don't have nobody looking at me. Yeah. Instead of his name, it's like neighbors, you know? Oh. But everyone engaged, so it was really nice. What about you? You just got back from a conference. Yes, I did. I was not speaking, so let's lower the bar. But I was attending a conference. I actually just got back from the U.S. Olympic and Paralympic Medical Conference. I know, it sounds fancier than… I was there, I was there. You know, I do sports medicine as my day job and so got the awesome opportunity to go to this conference, which was in Colorado Springs, which is actually where one of the three main Olympic training centers are. So in the United States, there's three training centers. And one of them is in Colorado Springs. It's actually one of the main ones. And so that's where this conference was. And it was great because we got to hear from the leaders of Team USA, which is very different. So I've always been fascinated by this world, partly because I love sports medicine, but there's Team USA. And then each sport has their own governing body. So there's like USA track and field and USA basketball and USA skiing and snowboarding and all of these different sports. And so there's each sport that has its own governing body and team of doctors and physical therapists and athletic trainers. And then there's, of course, Team USA. And so it's interesting having people from each representative sport being there, or most of the sports at least being there and being able to talk to the leaders of Team USA. and hearing about new protocols and parameters and how they're going to do things for the Olympics in Paris in 2024. I was there because I am hoping to at least be able to participate in the Olympics when it's back in Los Angeles, which is where I did my training. And so really kind of getting a glimpse for how that works and how everybody gets ready and touring the training facilities and looking at all of these different things. It was awesome. And so I'm really glad that I got a glimpse into that world. It wasn't as exciting as you, you know, speaking in front of hundreds of people and like having that feeling of accomplishment. But I was fascinated by this world. And so we were both at conferences. So yeah, so I guess that's a little bit about what's going on in our world. But now we get to be hot. So this is our money mishaps and confessions part. So along with starting off our podcast with a life is lifing segment, we also want to occasionally throw in some money mishaps and confessions. And this is kind of where we talk about some of the mistakes that we made. Britt, do you have any money confessions or mishaps this week? Yeah, so as you all know, this is the time to prepare your tax documents. And with that, it also means that that deadline is approaching for the backdoor Roth IRA. Now, I still haven't done it yet. Wait, for 2023? For 2023. Okay. Yeah, and it makes taxes just a little bit more complicated because I haven't already done it. They've already sent out, you know, all of the tax, the K-1s, the 1099s, and all of that stuff. I don't know what the specific document is that Fidelity sends us regarding the backdoor Roth IRA, But it's not there. And so I have to, therefore, tell my tax accountant, oh, by the way, despite what this says from Fidelity, I'm actually, I've done this on April 13th. It's not going to be that long. It just makes things a little bit more complicated. If I had done it in the actual year, the tax year, then it would be a lot smoother. And I haven't done Brooks either. So nobody has contributed to their Roth IRA. Well, okay, so for our audience who may be listening and be a little bit lost. So when you're trying to invest money, there's different accounts that you can use. And so a lot of people invest money through their work sponsored retirement accounts. Those are things like a 401k or 403b. And then you can also invest money outside of your work retirement accounts. And one of those kinds of accounts is an IRA. And one type of IRA is a Roth IRA. And so when you make a certain amount of money, you can't contribute directly to a Roth IRA, you have to contribute indirectly. And one of the ways to do that is through the backdoor, which we'll talk about probably on a future episode. But you were just saying that one of your money mishaps is not doing it in the calendar year. And so this is probably getting a little bit into the weeds, but there are certain things that you have to do by the end of the calendar year in order to account for them on your taxes. And then there are other things that you actually have until the tax filing deadline. And so contributing to a Roth IRA or back to a Roth IRA, you can actually do into the tax filing deadline. And so what you're saying is that you're basically going to do it before the deadline because you haven't done it yet. Right. And because you've waited a little bit longer than maybe other people do, you have a couple of more tax documents and it's made your tax life harder. But you actually slipped in something really cool in there that I don't know if our listeners picked up. And that's that you haven't done it for your daughter, who is, by the way, what, four? She's five. She's five. Oh, I'm sorry. She's five. She's five. So I don't know about you, but when I was five, my dad, now I have a bone to pick with my parents. Because I definitely, my dad was not setting up a Roth IRA for me. Mine either. An investment account for me at five. Yeah. I don't even think I was getting an allowance. So and you're like investing on behalf of your kid and we probably have to get into the nitty gritty of a Roth IRA and how you can set one up for your kid to set your kids up for success in the future. But I did hear you slip that in there. So even though maybe one of your money mishaps is not doing your own backdoor Roth IRA before the end of the calendar year, you're clearly doing something right because you have Set this thing up for your kids and a lot of our listeners probably gonna want some inside scoop into that Brittne So you'll have to let us know well, Alicia. I just thank you for always taking us a step back and clarifying the details We always will get the details from Lisa. So thank you for that and also I appreciate the support that even though there's a something that I could have done better that I'm still doing a lot, right? And that's where we are with Wealth Minded MD. Like, yes, we still make money mistakes. But as long as you're doing more things right, and you can appreciate those, then there's still opportunity to fix the mistake and be better in the future. Well, Alicia, that's enough about my money mistake. What about yours? So I did my Roth IRA on top. So I don't know what you're talking about. I got mine in there. I'm actually doing it for 2024. So I'm on top of my game. But no, so you know, mine is related to this conference. You and I were just talking about how we just got back from conferences, and we both found them rewarding in different ways. But you know, for me, when I'm going to the conference to attend, usually I'm going and my job is reimbursing me. And so one of my money mistakes is basically, you know, trying to make sure that I understand all of the details to get reimbursed. I am newer in my job. I just started my job here about five months ago, maybe at this point. And so I'm not as familiar with the way that reimbursements work for certain things. And I've had some difficulties in the past, you know, paying for things up front, waiting months to get reimbursed. And maybe part of it is my fault. Maybe part of it is the system. But really trying to figure out this thing, and I tried something new. I tried to go and submit it as a cash advance, which sounds like it should work, right? Yeah. I did not get the cash advance in advance. And so the cash advance has been delayed. And so I probably clicked something wrong. I'm still trying to figure that out. So part of my money mistake or confession is that even folks like me who can be on top of some things, still struggle with some basic things like getting reimbursements in and process through my job. And so I'm still trying to figure that part out. Hopefully I can figure it out sometime soon so I can get my money back. But yeah, that's a little bit about kind of what I'm going through right now when it comes to money and cash. Yeah, the reimbursement is a little bit tricky because that's even the case for us. They will not reimburse you until you have evidence that you attended the thing that they're paying for. So the fact that you pursued a cash advance, I mean, that's high level. I've never actually thought about like, well, I was struggling trying to put it in and I had to zoom call with somebody and I don't even know. Anyway, so we were trying that because I was like, man, you know, part of the problem with the reimbursements for a lot of people is that you pay for the stuff in advance, right? You're paying for the registration, you're buying the flight. And then when you're on the conference or at the place, you're paying for food. You are paying for the hotel and that's oftentimes can stack up to thousands of dollars. And then it's not until months later that you're getting that reimbursement. And so it really just makes you have to keep more money in cash. And I think that's part of my problem is that I'm so like I know where every dollar is going, so to speak, that sometimes I don't always leave room for inefficiency. Yeah. And so that's part of the thing that I'm learning is that, okay, sometimes there are things that you can't control and you probably do. I say you as in me talking to myself. There are probably some things that I myself can do differently in order to maybe not have that be so big of a stress. Yeah. I get that. I get that. We should talk about how to manage that, like some strategies for managing that in the future. All right, well, let's move on to our financial focus. Yes, it's our financial focus. All right, so we are going to talk about a financial to-do list. And it's so funny, as I was thinking about this, as we were thinking about this, it wasn't necessarily for the entire year. It's kind of a financial to-do list for this part of the spring, as this is dropping probably sometime early March. to-do list in the spring over the next month or two in order to get your ducks kind of in a row. And so, yeah, we got a list for you. Brittne, go ahead and start us off. What's the first thing? Yeah, so the first is to update your spending plan. Yeah. Lisha, you helped us with the script here, and I see that you strategically wrote spending plan and not budget. That's what we mean, basically. So, okay, so here's the thing. I don't like the word budget. I feel like it's very restrictive and it makes me feel like these are the things that I can't do. I see. And so I like to frame things more positively because I found that I've had more success doing it that way. Yeah. And so if I say, you know, I have to have a budget, it makes me think, oh, okay, these are things that I can't spend on. Versus if I say, this is my spending plan and this is what I've designated that I'm going to spend money on and how much I'm going to spend. I don't know, for me, it just sounds different. Yeah. makes it something that is a little bit more feasible. And so yes, basically update your spending plan. If you like a budget, if you like that word, you can use budget. Whatever you want to call it, the allocations for where your money is going to go for that month, and not even just thinking about that month. Like Lisha said, she has these conferences, and sometimes we don't necessarily allocate for that spend because it might be an opportunity that comes up in short notice and you want to take advantage of that opportunity as career women but then it always doesn't match with our finances and how we've made that allocation. So one of the ways that I like to do this to start with looking at All of your money that's going out when you're updating your spending plan I like to reflect on the past three months because no month is the same If you have in this month december, we know that christmas is there or maybe there's a birthday month So therefore you might find yourself spending a little atypically like than you would traditionally, you know from a day-to-day So to go back and retrospectively evaluate your expenses, then how I like to look at it is what is the income that's coming in each month. And for those of us who have side hustles, there might be some variability in that. So what is your variable income? What is your fixed income? And there are different strategies for your spending plan versus variable versus fixed, but looking at the income and then doing an average. Then using that information to predict or project what's going to be upcoming in the next months and what it's going to look like so that you can allocate your expenses appropriately. Then looking at your expenses and marking what is fixed, like your rent, your mortgage. If you have daycare, then typically that's a fixed expense. If you have any type of insurance, things of that nature, and categorize that. Because usually, unless you're calling somebody and negotiating for a lower rate, you're not going to be able to change that amount. and looking at your variable expenses. How I also like to evaluate the variable expenses is, is this a need? Like my utilities, it's a need, but it's a variable. You know, if it's a hot summer, then I'm going to spend a lot more on air conditioning versus a want like dining out. That's a variable expense, but it's not something that I necessarily need. Alicia, what do you think about your spending plan? How do you, how do you work through this? Yeah, so it seems like you kind of first take a look at income, and you look at what's fixed, so what's the money coming from my salary or from my job, right? Because usually that's around the same each month or every two weeks. And then you're examining variable income, and then you're looking at different expenses that you have, what's fixed, what may change. I do the same thing, I think. It depends on if I'm making a brand new spending plan, like if I've got a new job where I know that the income has changed drastically. or if i'm in the same job i mean most people don't change jobs that frequently and so usually you're going to have their same you're going to have some sort of base pay base salary for most people and so i usually take that when it comes to the variable income i tend not to count that as much because i don't want to rely on something that may not be there and so i tend to kind of discount that and not even include that so i just use the income from my main job And then I say, OK, I know I have this much coming in. What are the things that I know I have to spend money on and what are the things I know I want to spend money on? And I kind of divvy it up that way. So I think both of us do things pretty similarly. And the important thing is to just update your spending plan, because, of course, you want to make sure that your money is being allocated the way that you desire. Are you spending too much in your eyes? Are you saving too much or maybe not enough in your eyes? Are you paying down debt the way that you'd like? And so I think whenever you update your spending plan, you're able to make sure that your spending plan aligns with your money goals. Yeah. And that is kind of the main point here is, am I spending money the way that I desire? Am I spending money the way that I think I am? And I think any time that you're examining your spending plan or updating your spending plan, you're really able to answer that question more accurately. And I love that you included the savings. And not only are you saving enough, but are you saving too much? I don't know how you think about your savings. I've heard a couple of strategies at the conference that I was at. I went to a couple of sessions that talked about this as well. When I think about savings, I think about how much money do I have in the bank saved right now? Yeah. Because if I have $8 million invested. Oh, OK. That's what we. That's the. I said yes. Those are the examples that we. Because I was going to say more like $80, $800, maybe $8,000 if we were being pushed. See, this is a problem. See, you and I are on different levels here. I'm willing to accept the fact that you've been in attending longer because you're older. You look great. You look great. You look great. You look great. I didn't even want to go down that path and I could just feel it going the direction I didn't want it to go. I was just saying that's the reason why we're using different numbers for our examples here. But anyway, keep going. $8,800,000, $80,000, $80,000, wherever you fall. So it's how much do I have saved? How old am I? Because we know when you start investing, and when we say save, we don't necessarily mean just saved in a brick and mortar or online bank account. We are also incorporating investments here so that that money can actually grow and work for you. So if you're a lot younger, like Brooke, right, she's five, she's quote unquote saving, I'm saving for her, but putting that money into a Roth IRA that has so many decades to grow and to compound and to earn more for her. So if I am younger, then maybe my savings rate will not be as aggressive, depending then if I am older. Then the third factor that I incorporate is when will I retire? When will I desire that opportunity to no longer work? If I'm 20, I want to retire at 40, then that means I have 20 years of savings. But if I'm 20 and I want to retire at 70, then I have 50 years of savings. So trying to incorporate all of that because time is the one factor that we have to incorporate into these money decisions. What about you? What do you think? Yeah, no, I love that. I love that. It's because it's not just a lot of us think about, OK, I'm saving for a trip. I'm saving for a house. I'm saving for a car. And some of the things that we're, quote unquote, saving for are for things that we're going to spend within the next few years. But I love the way that you thought about it and said, wait a minute, saving also includes our investments and saving also includes what we're doing for retirement, when we think about it that way, then we may think, oh, goodness, I need to be saving or investing maybe a lot more. And we're going to get in future episodes on what accounts are we using to do that? How are we doing that? How is that feasible for us? Because people could look at us and say, well, you guys are both doctors. You make a lot of money, so it's easier for you to save. It's easier for you to have a spending plan. And I will say that there is this threshold or baseline level of financial security that you get once you start making a certain amount. But it really, it's not like once you make past x amount of dollars, whatever numbers in your head, that all your money problems go away. And actually, I think that that was one of the things that I was surprised by when I did start making more money. So for those who maybe aren't as familiar, right, you go years of school, you finally become a doctor, then you're paid not a high wage because you're still in training for so many years. And then you finally get to a point where you can practice on your own and you're making a lot more money. And my assumption was I'm going to feel so much better. My assumption was I'm going to be able to do everything that I want. I'm not going to have any money problems. And I'm not even going to need the budget because I'm just going to have so much left over that it doesn't matter. And that wasn't the case for me. And I think it's not the case for a lot more people. And it sometimes can be embarrassing to talk about because I think once you make over a certain amount of money, people stop having sympathy for you and your money issues. The point that I'm trying to make is that no matter how much you make, whether you think it's a lot or you think it's little or whatever, Everybody needs a spending plan. Everybody needs to look back and say, how much am I spending? How much am I saving? And really start to think about, OK, do I want to alter this a little bit? Do I want to allocate my money in different ways? Because it might require cutting back in one area and stepping it up more in another. Definitely. And the one thing that I just want to add to this is that we acknowledge that everybody's not starting from the same space, you know, from the same starting point. Yeah. And Lisha, I love that you said that, you know, I thought my money problems were going to go away as I got more money. Actually, when I graduated from residency, not to say that there was a new money problem, but there was a new sentiment of responsibility, now that I'm making more, how do I reach back to help those, you know, my family, I'm from Flint, Michigan, so to help those who supported me through this journey, whether it was a financial support, or a moral support, sometimes we still have to reach back. I know that some individuals might need to send money to family that are international to help to support them. So that stuff should be considered in your spending plan also. Like who else? How else do I want to make a contribution with my money? Whether that's to family or whether that's to a charity, whether that's to church, some philanthropic pursuit. And sometimes we don't think about that gift giving component as well, or that not necessarily a gift, but the additional support that we need in order to feel like we're doing a good job. Yeah, for sure, for sure. So our first thing on our financial to-do list is to update your spending plan or your budget, whatever you call it, but to make sure that you're spending money and allocating money in ways that align with your values. Number two for us is to gather documents for your taxes. And that's so funny because I remember, Brittne, I don't know if this is your same thing too, but I remember not making as much. And being like, ooh, tax time. I'm going to get a refund. It's going to be great. I'm going to go shop. I had plans for the money that I was going to get back. And my taxes were not complicated because I worked one job, if that. Most the time I was in school, right? So I'm working one job. And I've got one, you know, W4 or whatever that I'm getting back or W2 that I'm getting back. I just put that in H&R Block TurboTax and it's like, OK, it's how much am I getting? $3,000, $2,000? That is not the case anymore. I'm going to tell you, like, as I have been blessed enough to be able to have multiple sources of income. Yes. My taxes have gotten so complicated. Even things that I didn't think was income is income. I moved from Los Angeles, California back to Atlanta, Georgia, and so I actually got a little refund from the state of California last year. Don't worry, I had to owe a lot to the feds, so that was a whole money mistake. We gotta talk about it. Anyway, so… Got some back here, had to pay something. It was a whole thing. Anyway, I didn't realize that I had a form from the state of California saying like, hey, you got a tax refund. You got to put that in. I used to do some side work for a consulting company, and they paid me partially in stock. And the stock value chains are like, hey, here's this form. I have credit cards, and some of them are rewards cards that I earn points for. And they're like, hey, you earned this many points. Here's your little form. And so it's getting to the point where I'm like, First of all, how do I follow these forms? Do I have all the forms that I need? And so it's gathering all of your documents. And so for me, it's what were all my different sources of income? Do I have a 1099 or a W-2 or whatever from all of these different jobs and things like that? Do I have some other alternative types of investments that require K-1s and other sort of tax forms? As people, you and I both kind of are self-employed in that we own our own businesses as well as working our day jobs as physicians. And so for our own businesses, it's, okay, what were my business expenses and my business deductions? And do I have proof of that? And do I have the receipts? And did I fill out the stuff in QuickBooks correctly? And did I do my bookkeeping? All of these different things. And so one of the things I've taken away is, even though I feel like I'm pretty good at taxes, is I'm probably going to have to outsource that sooner rather than later. Brittne, I know you probably have a lot more experience with outsourcing than I do in terms of your tax person. We were talking about this before the episode. Why don't you give the people a little knowledge about what you do? So Alicia, I hear just the complexity of tax documents. And I don't really think that I have personally developed a strategy right yet that I'm practicing. I thought you were going to drop a bomb on us. And you were like, girl, I got nothing. But as you're talking about this, it just makes me recall a couple of things. Like one is simplifying things as much as possible in your finances. Because we know, and I think you actually mentioned this the last episode about atomic habits, right? And this also qualifies for our quality improvement principles. But anytime we make something complicated, we're not going to want to do it. It's not going to be as visible if we're missing something. And so as you're talking, I'm like, oh, you know what? It would be a really good thing for us to create. is like some type of portfolio where you can not only keep your investment stuff, yes, that's important, but just an overall financial organizer so that you can keep track of all of your accounts. Because you were mentioning like your bank accounts, right? We have a mortgage with one bank, we have a cash balance plan, and we'll talk about the details of all of this. So cash balance plan is basically like a pension, like a defined benefit plan with another bank. And then we have our emergency fund and an online bank. And then we have a brick and mortar bank that we can go and have access to. But each of those banks served a purpose for our lives at one point. But now I'm just thinking about the complexity of it all and how many more forms I got to look for. You know what? I did this the other day. You brought up a good point. It wasn't until this summer, Brittne, that I was like, I'm going to close one of my banks. Like, I am a member of a credit union. I'm a member of Navy Federal Credit Union. I don't necessarily endorse them, although if they want to endorse this podcast, we won't say no. Because my father works for the Department of Defense. And so because he's in the military, I have access to Navy Federal. And they're headquartered where I grew up. So it was just easier. But I like that bank. I like being a part of a credit union. I feel like I get good deals. But I also had a bank account with Bank of America. And I was looking this summer, and I was like, why do I still have this bank account? I opened it when I was like 18. So I guess there's a little nostalgia there in terms of like, oh, it's my first bank. But I don't go into Bank of America bank. It doesn't really serve a purpose. And I feel like I was paying a lot of fees, honestly, being a part of a big, large commercial bank like that. And so I made the decision this summer to just transfer everything over to Navy Federal so that I had one bank for a lot of my stuff. And it has really made my life simple. It took a little work in terms of making sure that I figured out which bills went to which bank and connecting everything together. But I do agree with your point about simplifying things, especially when it comes to banking, when it comes to your investments, and as much as you can in terms of income sources, and just making sure that you can keep track of it all. Yeah, it's so much. My husband, so I'm married, and we do a joint return. So we also have my husband's income, and my husband speaks. And when we speak, we get paid. And if you pay someone over $600, then you have to get that 1099. So it's kind of keeping track of all of this income. We've had some issues before with the IRS and RCPA. The IRS? Issues with the IRS. So fun fact, my dad's an auditor for the IRS, which is what he does for the Department of Defense. He doesn't audit individuals. But I do find this funny that my dad's like the tax dude. And you're like, we got in trouble. Yeah. Man, it's it because you have to those documents, the 1099 are filed with the IRS. So the IRS, although we have to file our taxes, they already have a rolling list of calculation of how much income you've produced. And of course, they want their cut of it. And as a 1099 versus a W2, then those taxes are not removed before you receive that payout. Yeah. And so you have to make sure that you report your income. And unfortunately, there is like some question of under-reporting. Thank God, our tax agent, CPA, she, what is it called? Alicia, you probably know, is an enrolled agent, right? When they can speak directly to the IRS. Oh, that's good. I don't remember. I think that's the correct terminology. We can Google it and correct it in the show notes if it's wrong. We might have to cut this part. But thankfully, our new tax advisor was able to reconcile those differences pretty easily. And at some point, we had overpaid significantly. So this is the real benefit of just making sure you have somebody within your financial community who can make sure that you're making your quarterly payments on time. But you don't want to give the government more money than you have to. Because basically, it's not necessarily a 0% interest. Because we actually got, I think, a K-1 from the IRS this year because we had overpaid. And they gave us some interest, nonetheless. Y'all paying so much to the IRS that they paying you back for interest. I ain't heard that one before. But you don't want to underpay, you don't want to overpay, right? You don't want to overpay because if you get a refund, basically you gave somebody else that money and that money could have been working for you. That's true. And another element to add to this is Whenever you're gathering your documents, so it's not only just your income and then also your expenses that we talked about from the business perspective, but donations, right? So you want to document all of those and any 529 accounts if you have any children or even if you're a grandparent and you gave some money for 529, then all of that can be deductions. So yeah, there's a lot involved with taxes. Yeah, a ton, a ton, which we'll probably dedicate some entire episodes to that a little closer to tax time just to give you all some strategies. But yeah, so our number two on that list is making sure that you are gathering all of your tax documents. Yeah. All right. So moving on to number three is to reevaluate your debt reduction plan. And I think I'll start this conversation with if you are someone who is a medical professional, you likely got some student loan debt. Or had some and maybe you paid it off like Brittne did or you still have some like me. Yeah, so you probably have some student loan debt. This is really important because for some of us, when you pay student loan interest, then that's another tax deduction that you can include, but you really want to ensure that you make a strategy for your student loans or your consumer debt, but to focus on student loans first, a strategy for your student loans, because it's going to impact all of those things that we've already talked about, right? It's gonna impact your spending plan. It can also impact your taxes. And when you're thinking about your student loans, because if you get into an income-driven repayment plan, and we could talk about this more, but there are ways in which you can lower your income to reduce your debt payment and get more things forgiven, right? And really maximize that. I think oftentimes when we approach debt, we approach it from a negative. At least for me, with my student loans, my parents weren't able to pay for my education. And so I express gratitude to my debt. And yeah, I don't know about y'all can see my face. I'm like, gratitude. I'm like, Dad, you could have paid that. No. But when you think about the definition of debt, right, something that you owe or that you're indebted or grateful for, So the reason why I bring this up is because a lot of us feel guilt about either having so much student loan debt or we feel burdened, overweighed, and that anxiety is not going to allow you to be strategic, to feel empowered about managing your debt. What we want you to do is to make wealth-minded decisions that you can be empowered. and manage and create a strategy for your debt. So Alicia, I'm going to hand it over to you because I know you have student loans, so you're going to let us in. Okay, so I don't like the way that you do that when you're like, let's just get it out in the open. The way that you say it, it was triggering to me. I'm sorry to trigger you, but I just also acknowledge that you have a level of expertise right now. When it comes to debt? Oh, thanks. to student loans because you have them. And I know you pay attention to all the details. I'm just passing the mic. I'm giving you a hard time. I'm giving you a hard time. I'm giving you a hard time. No, but Brittne's right. I did do a lot of student loan consults, and I have studied student loans extensively. So we will do probably an entire episode when it comes to student loan strategies. But I do agree with you when it comes to really evaluating your debt and ensuring that you're paying it off at a reasonable time, over a reasonable time. A lot of physicians, I don't know if this has been your experience, Brittne, I've run into a lot of physicians who say, I'm not worried about the debt. It's like it doesn't phase them anymore. Many of them have multiple six figures and student loans, and they're like, Lisha, I'm not in a rush to pay it off. It's almost like they've had the debt for so long and it's grown so large that they've just kind of accepted it as a fact of life and said, you know what? I'm just going to make my whatever minimum payment is, and I'm going to do that for the set amount of time. I'm going to set it on auto pay, and I'm not going to let it concern me. And I'm not necessarily saying that that's a bad strategy. I think it depends on what debt you're talking about, what the interest rate is and what your other goals are. But my main thing when I say, you know, reevaluate your debt reduction plan is making sure that having that debt is not negatively impacting your life. And for a lot of people, myself included, it can. Even in ways that maybe you might not have thought about. You mentioned that even just having that student loan debt can be a burden, right? Because you're having that high monthly payment that you've got to send to your loan servicer each month. But there's also other sources of debt. A lot of people have high mortgages, or they've got a car loan, or they've got credit card debt, or whatever it is. And one of the things that's really come to my attention is that having that debt can really prevent you from being able to accomplish other things. If you've got a lot of debt, then that's going to impact the kind of mortgage or the kind of house that you can purchase. It's going to impact how much cash flow you have on a monthly basis. It's going to impact your ability to go on vacations and purchase some of the things that you want. And so for a lot of people, that debt is negatively impacting their life because it's preventing them from doing some of the things and acquiring some of the things that they desire. And then when you add on the interest, the fee that you're paying to have the debt in the first place, oftentimes that is accumulating over time. So by the time you finish paying off that debt, you paid off double, if not more than what you even borrowed. And so for A lot of us, especially if you're going to be somebody who's going to say, you know what, I'm going to take charge of my finances and I really want to do better this year in 2024. Part of doing better is not just evaluating your spending plan. It's also taking a look at your debt and saying, is there a way that I can maybe pay this off faster or get it forgiven so that I can really make bigger strides when it comes to my finances? I love that. And so we've talked a lot about student loans, and we're definitely going to dive into the weeds about student loans. Another thing that I want to mention is consumer debt. I do not recommend any high interest credit card consumer debt because it outpaces any other investment that you will ever invest in. So whenever you're examining your consumer debt, or all of your debt, you want to know what are your interest rates. Are they fixed or are they variable? So when we purchased our home, I have a 10-year arm adjusted rate mortgage, okay? I did that for a specific reason. I have a strategy for that. And I need to know though, okay, it's fixed for how long? And then afterwards, what's going to happen if I don't pay this off in 10 years or if I don't refinance? So what are your interest rates and what are the terms around those interest rates? Then if you have consumer debt, what is the minimum payment? Because if you're someone who's carrying a balance on your credit cards, and you have a goal to pay it off, you can employ various strategies. One is thinking about the snowball method where basically you pay them down from the smallest amount to the largest amount, right? So that you can get that dopamine boost because paying debt ain't fun, but you got to train your brain that it is. Or the avalanche where you pay the highest interest rate first, pay that one off because you're going to pay less money over time. But you cannot create this strategy unless you know these things. Then you also want to look at the balances. And this was something that I realized after coaching many women to pay down their debt, is that sometimes we go over the balance. and we're not even aware of it. And when you do that, they charge you a monthly fee, usually about 39 to $49 every single month. And if you're carrying a balance on your credit cards, that's money that's not working for you. So the strategy will be in that case to pay off the one at least or pay down it to that maximum balance so you're not being hit with this fee every single month. Yeah, yeah, I love that. I love that. So really taking a look at the kind of debt that you have. And as you mentioned, especially if you got credit card debt, OK, looking at what's the interest rate, what is the fee that I'm paying to even hold that balance? What's my minimum payment? How much do I need to pay each month at minimum? And then what's my overall balance and what's my credit limit? And we're going to talk about credit cards in depth. But I think really reevaluating your debt reduction plan, all of the different kinds of debts is really integral as we really get started in 2024. You know, another thing is to adjust your work retirement account contributions. You know, I run into people all the time, some of my colleagues, some of my friends who, you know, I talk to them, I say, hey, are you investing money? Yeah, I put money in my 403B at my job or 401k. And I say, that's great. Did you make the adjustment this year? Because the contribution limit has changed. And they look at me and I'm like, what? Huh? I haven't adjusted that thing in two years. What are you talking about? And I'm like, well, okay, the amount of money that you can contribute each year to a retirement account It increases with inflation a lot of the times. And so the limit in 2023 was around $22,500 for people under age 50, and that's increased in 2024. Now the limit is $23,000. So you can contribute up to $23,000 if you're an employee under the age of 50. You can contribute a little bit more if you're over the age of 50. But I was telling them this, and they were like, oh my goodness, I didn't know. How do I adjust it? How do I change it? And, you know, it's one of those things where it's not complicated, but until someone has really explained it to you, it can really be a barrier to you making any change. And I always tell them, you know what, figure out what percentage of your paycheck allows you to contribute the maximum. You know, so if you you know, make $250,000 a year, and it's 2024, so you're trying to contribute that maximum of $23,000, say $23,000 divided by whatever you make per year, and you'll get that percentage, and that's what you enter into your work portal. You know, and so it's not complicated, it's just one of those things, if the contribution limit has changed, as it usually does from year to year, then the percentage of your paycheck that you're contributing also has to change, so that you can make sure that you're contributing the maximum each year. Part of that is updating your work contributions. And as you're doing that, in most work portals, I don't know if this is the same for you, Brittne, they'll also ask you to check off if you're going to contribute pre-tax versus Roth dollars. And we'll get into this in a different podcast about the differences in those, but also making sure that you're deciding, is this pre-tax? Meaning, am I going to get a tax break this year for the contribution that I'm making? Or am I going to make this contribution Roth? Meaning, am I going to pay those taxes up front and then never have to pay them again? And for certain people in certain situations, it can make sense to do one versus another. And so, you know, in order to figure out the right one for you, we'd really have to examine your own situation. But I just want to make sure that you're aware of like, yeah, you may have your thing on autopilot at your job, and that's fantastic. But each year at the start of the year, look up and say, oh, did the contribution limits change this year? Or, oh, maybe I've crossed that mark and I'm now over age 50 and I can contribute a lot more. And making sure that you're maxing that out, AKA making sure that you're contributing the maximum to your work retirement accounts. And we'll talk about in future episodes all the perks and the benefits of doing that, asides from just saving money on your taxes and allowing you to build wealth. They also have a lot of asset protection benefits. Sometimes you get extra money from your job to Invest so there's all these perks and benefits of using these work retirement accounts. So there's nothing wrong with doing so We encourage you to do so just want to make sure that you're contributing the right amount each year Definitely and you know for some people Like you said two years. Oh my gosh, two years is not a long time It is a long time when you're thinking about investing but some people aren't able to max out your retirement account like you're not able to put away that 23 $50,000 into a 401k and we get that you know, wherever you are what we're saying is to push the limit a little bit more to Evaluate your spending and I just wanted to know one thing that when you make this adjustment that's going to impact your net pay how much you're bringing home maybe depending on how what tax bracket you're in, right? It may not actually adjust your net pay much. But when you're creating your spending plan, you don't want to base it off of your salary because you haven't incorporated taxes, right? So you want to make sure that you're adjusting it for what you're going to be bringing home. So when you make these adjustments, then that may impact your net pay, And that's okay, as long as you reflect on those expenses, you have an idea of what's the need versus what's the want, and you can adjust accordingly. But if you're not maxing it out, go back, and you don't know these details, go back to your HR and understand what is the match. because you want to at least contribute up to the match so that you can get that free money. And it varies. Sometimes they match a percentage of your salary. Sometimes they match a percentage of your contribution. And you just want to make sure that you're getting as much as you can and try to adjust your spending plan accordingly. Yeah, I agree with that. Yeah. So talking about that, this is a great segue to setting up automatic savings. I love this because out of sight, out of mind. When you make it easy, you're going to do it because you don't have to manually go in and do it yourself each and every month. So how I like to do this is to think about paying myself first. Because in my mind, the money equation is your income minus your opportunities equal your spending, your expenses. And I don't think savings is an expense, I think it's an opportunity. And the only way that we can maximize that is to make that contribution first, because we know that there's lifestyle inflation, and you're just gonna spend more money when you see that there's more money there. But if you're able to allocate and automate these savings, then you're not going to spend as much. So paying yourself first. Investing in your retirement accounts. From your paycheck, designate a certain amount to go to an emergency fund if your emergency fund isn't fully funded. designate a certain amount to go to that account for your spending plan, right? And then think about other ways in which you can automate things. I like to also automate my bills, make sure that they get paid on time, because then that's gonna impact my credit score. So automate as many things as you can. Yeah, yeah, I agree with that. And so those are kind of our five things as we go through this episode is updating your spending plan, gathering documents for your taxes, reevaluating your debt reduction plan, adjusting your work retirement account contributions, and setting up automatic savings. And we actually, Brittne, we have a few more of these, but we're going to spare you today. But we are going to give you access to them. And so if you go to the WealthMindedMD.com website, you can go to that website and we will give you access to the remaining things on our financial to do list. We also got a freebie we're going to have on the website for you, for you to download. So we've got some goodies for you that we're giving away for free. Just head on to the website and you'll get some information on how to do that. Yeah, it's going to be in the email. So make sure you subscribe to the email list and we're going to email you the rest of the things that should be on your financial to-do list. Yep. Yep. We got you covered. And now we're on to one of my favorite segments, fun money. Fun money. That's fun money. Fun money. Let's get it. All right. OK, so Brittne, what are you doing fun with money? I mean, we just finished talking about our financial to-do list. And so I think it's cool for us to kind of go in and talk about something fun that we're doing with our money as we get ready to wrap up this episode. What is something fun that you're doing with your money, Brittne? So recently, because I've been kid-free, Which is my life 100% of the time, but continue. I've been spending more time with my friends, which is really nice. And I like to spend on others when I can. So we've been going out, eating so good. And I've been paying for my friends' dinner. So y'all, she has not, I just wanna, as this episode is dropping, I have not got invited to a single dinner. All right, she's not paid for my food. So I'm like, wow, okay, this is what we're doing now. You're like having a grand old time. I'm feeling a little salty over here. I'm in my feelings a little bit. Don't be, don't be, I got you. Y'all heard it. Y'all heard it here first. I was baiting you. I was waiting. I was waiting for the invitation. And we're going to make it a wealth-minded MD expense. Oh, it's a business. Wait, no, because that means I'm paying for it. So then you're not. All right. We got to cut this, because all of a sudden, it's not fun money. It's disappointed money. That's Alicia's right here. Wow. Brittne's having a great time. So your fun money thing is you're buying dinner for your friends who aren't me, apparently. You know, I'll just kind of take you up on that. So I am also spending money on food. So I actually, I don't know if you've heard of Blue Apron, it's pretty common I think. But I do Blue Apron like a couple times a month. And that's one of the fun things that I'm doing with my money because I don't necessarily dislike cooking, I just sometimes don't have time to do it. And, you know, my mother, love her, fantastic woman, she cooks things that I don't always like to eat. Like I don't want to necessarily cook fried chicken and I don't do a bunch of casseroles and things like that. And so I love it when she does it. But when I'm cooking, I kind of want to cook things that are a little bit different. Yeah. And I like Blue Apron because it gives me different ideas for things that I could cook. And then, of course, they bring you all the ingredients. And I think it tastes good. And it's something that I, a lot of it is something that I would have not put together on my own. And so that's something fun that I'm doing with money is spending money on food for, you know, me to cook really nutritious meals at home. And so, yeah, not as exciting as going out to eat like you, you know, and going out with your friends. I'm sure it's just as delicious. It's not. Don't even lie to me like that. It's good. It's good, though. It's good, though. This is not a Blue Apron endorsement, although, you know, you want to endorse your girl. Let me go. But OK, that's our fun money segment. We are going to close out this podcast with a wealthy minds this or that. Yeah. Well, we should. You know, so it is Women's History Month. And I don't know about you, but when I reflect on just all the powerful women in my life and mentors, it just brings kind of like these warm, fuzzy feelings. Yeah. And I've also had the challenge of kind of struggling with who do I go to as a mentor, as a source of information. So my question for you is when you're thinking about choosing a mentor, do you value experience and education more or personality and vibe? That's a great question. That's a great question. Wow, when I'm looking for a mentor, what do I value more? Probably, I value the experience and the expertise more. Because usually, if I'm pinpointing a mentor, it's because they've gotten someplace and they've achieved something that I want to achieve. And the qualification for that is like, you must have done it before. Or you must have some sort of knowledge that I need. And so I'm looking for that experience and that expertise. But the reason why I pause is because if we don't have a good personality fit, then I'm not sure if it would work, right? I'm not sure that the mentor-mentee relationship would be as conducive if we didn't gel well from a personality standpoint. I really do think that you have to like the person that you're mentoring. I think the mentor really has to like the mentee because oftentimes it's unpaid labor. It's like, hey, can you Let me pick your brain and tell me all the things that you know and help me out and read my essays and do all of this stuff for free, right? And so you really have to like somebody in order to want to do that or, you know, have put in a lot of time with that person. And so I think that the experience and the expertise is more important for me, but I do think that the personality and the vibe also matters. Yeah. Yeah, I get that. I get that. For me, at least in reflecting on the women who are kind of in my mentor circle right now, the personality and vibe have very much resonated more so for me. Yeah. And I think the reason why is because if someone is someone who's Gracious empathic can see more than just that one objective. So say I'm like writing a paper or Working on quality improvement, but they can see the comprehensive perspective or view of my life With children with you know, what my goals are and help me to work through those goals I am able to value their advice a bit more if they have me In mind and not just like my career or that one. Oh, she wants to be a quality improvement expert So i'm just going to tell her everything about quality improvement Because at least the one mentor that I have that i'm thinking about she doesn't do what I do But she's a great sponsor and a great connector for me. Yeah, she has been life-changing for my fulfillment for my career satisfaction because she's helped me to process what it means to have all of these things and how that incorporates into who I am. Yeah, no, I think you make some great points. And I also think that there may be a difference between a sponsor, a mentor and an advocate and having people in those different roles in your life can really make a difference. So without going into a whole new podcast, Because we could talk about this all day, as y'all could see. We're going to close this one out. Yeah. So today's episode was all about your financial to-do list at the top or the beginning of 2024. And of course, don't forget to go to our website, subscribe on our email list. We can drop the last few ones that you need to know. Yeah. Hopefully you guys enjoyed this episode. We can't wait to come back to your ears next week. Bye-bye.
SPEAKER01: Hello, everybody. It's me, Brooke. I'm recording a little disclaimer for my mommy, Dr. Brittne Halford, and her friend, Dr. Lisa Taylor. Just so you know, they're not financial advisors, tax professionals, lawyers, or financial planners. Everything you hear is for education and entertainment. It's not strict financial advice, you know. So use your best judgment. Chat with a checked professional and all those other people that you need to talk to. Thanks for tuning in today. Keep cruising on your journey to wealth and wellness. Bye-bye.
SPEAKER_00: Now a final word from our sponsor. At Pearson Rabbits, they understand that life can change in an instant. It's hard to imagine that a sudden illness, injury, or catastrophic event could put you and your family in a devastating financial situation. Position-founded and position-focused, Pearson Rabbits builds human connections before they create growth. And they're a great company that can help you get the disability insurance that you need. Visit www.pearsonrabbits.com today and embark on a journey of safeguarding your financial future.
