Good Cash Podcast — Stability Traditions and Wealth-Constructing with ‘Culturally Competent’ Ideas from Jannese Torres

Welcome to NerdWallet’s Good Cash podcast, the place we reply your real-world cash questions. On this episode:

Perceive how first-gen People can obtain monetary success with suggestions for balancing cultural obligations and wealth-building methods.

How can first-generation People develop their wealth and shield their cash? How will you set monetary boundaries with household and mates whereas staying dedicated to your long-term monetary targets? Hosts Sean Pyles and Kim Palmer focus on the distinctive monetary challenges confronted by first-generation People and immigrant households that will help you perceive methods for attaining monetary independence. They start with a dialogue of suggestions and tips on managing twin monetary pressures of supporting oneself and one’s dad and mom and breaking cycles of poverty by self-compassion and monetary schooling.

Jannese Torres, host of the non-public finance podcast Yo Quiero Dinero, joins Kim to debate the significance of constructing a powerful monetary assist community tailor-made to particular person wants. They focus on methods for figuring out reliable monetary advisors, setting and sustaining monetary boundaries with household and mates, and gracefully declining pricey invites in favor of guaranteeing long-term monetary success. This episode is important listening for anybody navigating cultural and familial obligations whereas striving for monetary independence.

Take a look at this episode in your favourite podcast platform, together with:

NerdWallet tales associated to this episode:

This transcript was generated from podcast audio by an AI software.

Welcome to NerdWallet’s Good Cash podcast. I am Sean Pyles.

On Good Cash, we’re all about answering your cash questions, and right now we’re tackling an essential one: How can first-generation People develop their wealth and shield their cash? Kim, in her position because the host of our common e-book membership collection, is right here to information the dialog. So Kim, who’re you speaking with?

I’m talking with Jannese Torres, creator of the brand new e-book, Financially Lit!: The Fashionable Latina’s Information to Stage Up Your Dinero & Turn into Financially Poderosa. She can be the host of the non-public finance podcast Yo Quiero Dinero, and we’re joined by my fellow Nerd Melissa Lambarena, a author on the bank cards group, who additionally serves as an English and Spanish language spokesperson right here at NerdWallet.

Sounds nice. Nicely, I’ll allow you to all take issues from right here.

Nice. Thanks. Jannese, thanks a lot for becoming a member of Melissa and me right now.

Thanks a lot for having me. Excited to be right here.

Let’s begin with what’s distinctive about cash for first-generation People and immigrant households. You write about how cash is commonly not talked about, for instance. Are you able to share a few of these monetary challenges that first-generation People usually face?

Completely. So I believe at its core, it will probably begin with one thing so simple as the language barrier. For a lot of first-gen children, we might be the household translators, oftentimes in monetary conditions. And so it isn’t unusual for us to tackle the duty of serving to our dad and mom file their tax returns, navigate balancing a checkbook, or any variety of different monetary duties that, for folk who can converse English, it’s simply a lot simpler to do this.

In order that’s one factor. However then I believe there’s numerous, possibly I might name them cultural nuances, that make the monetary business and first-gen communities type of be at odds in a means. And I believe a few of that comes from the truth that there’s this lack of culturally competent schooling and knowledge oftentimes. It is actually even actually laborious to seek out alternate language content material from a banking establishment or a monetary establishment.

And in addition, there’s numerous trauma related to funds, particularly in case your dad and mom have come from one other nation the place possibly the financial state of affairs just isn’t as secure. There is a huge distrust of economic establishments. So numerous these issues can compound in a means that make us very fearful of cash and in addition the establishments that management it.

I can undoubtedly relate to that as a first-generation American, having to assist my dad and mom with numerous these, determining completely different paperwork and numerous these monetary questions. One other factor that impacts us is that we would have to avoid wasting for our personal future, but additionally assist dad and mom who lack retirement financial savings within the current. And that is one thing that you just speak about in your e-book. What do you see or need for individuals who discover themselves on this state of affairs?

Nicely, I believe first off, it requires numerous self-compassion as a result of what I discover is there might be numerous resentment and frustration amongst first-gen children who really feel like, effectively, why did not mother and pop do higher? And it is like we’ve to have the context and perceive that they could not do what they did not know. It is not like monetary literacy info is pervasive no matter the place you are from, however particularly if you’re from an immigrant group.

And so I prefer to consult with the oxygen masks analogy, for particularly first-gen children, as a result of on the finish of the day, the inspiration that you’re constructing as a wealth builder is just going to be as secure as you make it. If you happen to overextend your self or simply end up constantly serving to all people else, however on the expense of your individual future self, then it is simply going to perpetuate this cycle of poverty and battle and feeling like we preserve working in direction of a purpose that we by no means truly obtain.

So I do advocate that people prioritize their very own monetary stability. However then additionally, if you already know that you’ll be able to must financially deal with somebody, begin having these conversations early and infrequently so that you could begin to perceive the scope of what that is going to appear like after which make a plan accordingly.

Within the foreword of your e-book, it notes that numerous private finance publishers actually have a blind spot, and so they’re primarily writing for rich, white older readers. When did you understand the necessity for a podcast and a e-book like yours, and how much questions do you get from listeners that they won’t hear wherever else?

I have been consuming private finance content material since 2016. And after about three years, I spotted that the voices simply did not 100% resonate with my lived expertise as a first-gen Latina. And in order that’s once I determined to stay my foot in and resolve to launch the podcast, which inevitably led to my alternative to jot down this e-book.

It is undoubtedly been impressed by the quite a few conversations that I’ve had on the podcast the place of us really feel numerous imposter syndrome for wanting wealth, numerous worry as a result of there’s that lack of expertise and a scarcity of reliable sources that we will go to, to study extra about this info. And I’ve discovered that it actually strikes the needle when folks can hear tales from of us that they will resonate with.

And that is why I believe it is so essential to have that cultural context once we’re speaking about cash. As a result of for instance, I believe numerous the mainstream private finance content material may be very individualistic-based, particularly right here in America. Whereas for lots of communities of shade, it isn’t unprecedented to have multigenerational households the place individuals are contributing collectively in direction of monetary targets.

And simply the thought of the bootstraps narrative and choosing your self up and dealing laborious, however only for your self, it does not actually align with how we function most frequently in our communities.

And monetary trauma is one thing that you just strategy in your e-book that’s usually not seen throughout many private finance books. Is that this one thing that’s ignored of different private finance books, and the way can folks get to the foundation of their monetary trauma to make progress on their monetary targets?

I imply, I believe the entire dialog round psychological well being and cash is one thing that it must be extra prevalent. As a result of I’ve discovered time and time once more that it does not matter in the event you inform any person what they need to be doing, whether or not it is budgeting, saving, or investing — if they’ve psychological well being points and monetary trauma, that’s going to stop them from taking these steps. And so attending to the foundation of your cash beliefs is a essential a part of this entire journey.

For me, it was actually essential to incorporate that info within the e-book. One of many issues that I do is I stroll readers by understanding the place these narratives that we’ve internalized come from. When you’ve got a notion that wealth is someway intrinsically unhealthy or immoral, did you develop up in a family the place possibly that was the messaging from a non secular side? Or did you see your dad and mom combating over cash, and so it makes you afraid to speak about it together with your accomplice? All of these issues are subconsciously impacting how we function with cash, and I believe it is essential for folk to have that context as a result of oftentimes there’s simply this disgrace and guilt that we really feel about us not having the ability to make progress. However you must perceive why you’re feeling the best way you do about cash earlier than you can begin to alter these narratives.

I completely agree. I am so glad that we’re having these conversations extra now. I do not know in the event you’ve seen this too, however I do really feel like within the private finance house, individuals are keen to speak concerning the psychological well being aspect of issues extra. It looks like one thing that is arising extra usually.

Completely. I believe there’s much less of a stigma with regards to simply speaking about psychological well being on the whole, however I believe that has not essentially been on the similar tempo relying on the place you are from. I believe for particularly communities of shade, there nonetheless is numerous stigma about first speaking about psychological well being after which letting of us know that you just could be working with a therapist.

So I believe the extra that we normalize these conversations, the much less they will be taboo, and the extra open that folks might be. Since you usually understand when you begin speaking to folks, there’s lots of people which are going by the identical actual feelings, and it simply helps you’re feeling much less alone when you already know that there are secure areas the place you possibly can speak about this.

Sure, completely. You additionally write concerning the significance of constructing your self extra financially safe with a number of earnings streams. And I really like your private story with this, how your aspect hustle began with a weblog. So I might love in the event you can share how your individual aspect hustle helped you after an sudden job loss and why it is so essential to have these a number of earnings streams.

So I take into account myself an elder millennial. I graduated about six months earlier than the Nice Recession. And so regardless that I went to highschool and acquired a level in an effort to “get the secure job,” I didn’t expertise that as quickly as I acquired into the workforce. I discovered numerous of us having sudden layoffs.

And seeing particularly individuals who had devoted 20, 30 years plus to an organization and be walked out the door with nothing greater than a thanks and a field to gather their issues, I believe that for me was a really jarring realization at a younger age that possibly it is simply not so secure out right here within the company world. I at all times had that behind my head that I did wish to diversify my earnings.

After which once I acquired laid off in January of 2014, it was affirmation of all these emotions that I might had about simply not placing all of your eggs in a single basket with regards to your monetary stability. I had been dabbling with content material creation with the weblog in early 2013. And once I acquired laid off, I took a few months. As an alternative of speeding again to get one other job, I made a decision to double down and actually study on how you might flip an internet content-based weblog into an precise enterprise.

And so I began studying about issues like internet online affiliate marketing and model partnerships and the way do you set advertisements in your web site. And in order that led me down a rabbit gap of entrepreneurship, which led me into the non-public finance house. It has been a very attention-grabbing expertise seeing how one can have the ability to create your individual earnings streams simply with concepts that you just give you together with your head.

I prefer to encourage of us to actually check out their talent units, whether or not these are private or skilled abilities, and see how one can flip them right into a aspect hustle. As a result of on the naked minimal, you’ll make more money to repay debt or save and make investments. Greatest-case situation is you could be constructing your new profession.

For positive. After which, as you discovered, in case your major job supply or supply of earnings disappears, you’ve that to fall again on.

Completely. There’s only a sense of energy that comes from understanding that no one can mess with you financially, particularly if in case you have alternative ways of earning money.

I believe numerous our listeners are going to be impressed by that story. It is essential to remain conscious and simply learn up on what different individuals are doing on the market. And on that notice, some folks won’t wish to give up their job in the event that they take pleasure in what they do or they like having that safety of a full-time job. In that state of affairs, what are some choices that folks could must create a number of earnings streams, and have you ever stumbled upon any success tales all through your work?

Nicely, I believe that on the naked minimal, we must always all be utilizing a few of our disposable earnings to take a position. As a result of with regards to making that attractive passive earnings that everyone desires to make, that is the best strategy to do it. Creating a further earnings stream by dividend investing and thru capital beneficial properties, that is primary. If you do not have entry to an funding account by your job, anyone who has earned earnings can open a conventional or a Roth IRA.

So simply take into consideration what these choices are for you. It does not must be that you just’re constructing a enterprise. There’s of us who resolve to buy actual property, and that is how they create a secondary earnings stream. There’s of us who resolve to not purchase bodily actual property, however they will spend money on REITs or actual property funding trusts and be getting paid month-to-month rental earnings simply by being an investor.

There’s different methods to earn money versus simply beginning a enterprise. However I believe it is simply, like I stated earlier than, not put all of your eggs in a basket. And on the naked minimal, I believe it is actually essential, particularly on this unsure time that we’re dwelling in, to consider bulking up your emergency funds simply because it’s taking longer for folk to seek out jobs in the event that they do get laid off. And understanding that you do not have to take the primary supply and you’ve got room to breathe and work out what your subsequent steps are, I believe that is one thing all people ought to be serious about.

You additionally write concerning the significance of making a assist community for folks with regards to their cash. Are you able to clarify what precisely does that appear like? How can we create that assist community?

Completely. So I did discover myself at numerous factors of my private finance journey feeling unqualified to make choices, whether or not it was serious about am I prepared to depart my job and tackle entrepreneurship full time, or how do I begin investing on behalf of my household, understanding that I need to have the ability to assist them financially? And so in these situations, I wanted a second opinion and I began working with a licensed monetary skilled.

I’ve labored with an accountant now by my enterprise. I’ve an legal professional. So there’s completely different of us who’re consultants of their area who’re going to have the ability to assist you navigate moments the place you simply do not feel like you’ve all the data that you just want. And I believe it is essential to know that you do not have to determine all of this out alone, and oftentimes you in all probability should not.

Like within the case the place I used to be serious about creating an property plan, I didn’t really feel snug taking over some DIY template and hoping that that was going to move the bar within the occasion that I wanted to make use of it for authorized functions. And so in that occasion, I made a decision to hunt out an property planning legal professional to assist me determine that out. So I believe it is simply essential so that you can know there are folks out right here who can assist reply these questions in order that you do not really feel this overwhelming strain to determine all of it out your self.

For positive. One factor you write about, too, although is that it may be laborious to know who you might belief, and also you discuss concerning the significance of boundaries and what to do when members of the family ask you for cash. And right now on social media, when there’s individuals who name themselves consultants speaking about every kind of issues, how do you resolve who you possibly can belief on this situation if you’re making an attempt to construct your individual assist community like that?

I believe it is essential to belief, however confirm. So not simply taking your entire info from a single supply. There’s so many various locations to study private finance that I prefer to diversify my schooling the identical means that I prefer to diversify my earnings. Doing all your due diligence, ensuring that you’re researching any person simply to know what info is on the market about them.

After we’re speaking about monetary professionals, there are certification boards and completely different locations you could search for, ensuring that they’re nonetheless in good standing. I like referrals too. There’s one thing about working with somebody who has a direct relationship with somebody that you already know. That may be technique. Additionally, going surfing and looking for opinions.

There is not any such factor as an excessive amount of analysis with regards to determining who you possibly can belief. And I prefer to assume that folks naturally reveal themselves after a sure period of time, so be looking out for that too.

Sure. I like that phrase that you just used about diversifying your schooling and your sources. That makes numerous sense.

It is also essential to assemble assist in your monetary targets, and that is one thing that you just speak about in your e-book. Some members of the family or mates could not perceive what we’re making an attempt to do, and setting boundaries round cash can assist you fulfill these targets that you just may need, whether or not it is to avoid wasting or get out of debt. What are some ways in which you’ve got needed to navigate this and what recommendation are you able to share with our listeners?

I believe the very first thing is to know that it isn’t going to be very productive to ask somebody for instructions to a spot that they’ve by no means been. After I say that, I imply, in the event you have been the primary individual to be investing within the inventory market, it is in all probability not going to be very productive to speak to your loved ones about this if no one’s doing it. And so simply the thought you could create your individual group of assist, I believe it is an essential factor to think about.

As a result of most frequently we glance to the those that we already know to validate what we’re making an attempt to do and to know, and it isn’t essentially their job. It is your job to know the mission that you just’re on after which to rally the troops, if you’ll, create group, whether or not that is in individual or on-line. I’ve discovered an unbelievable group of entrepreneurs who assist me from everywhere in the world on-line.

And it is the identical factor with being a first-gen wealth builder. Whenever you begin speaking about these things, you may naturally discover the people who find themselves aligned with the place you might be and the place you are making an attempt to go. And so I believe it is simply essential that you do not essentially restrict your scope for creating that group amongst the folks that you just already know. It’d require you to be in new areas and have conversations with new folks.

What about with regards to setting boundaries round cash? When members of the family say they wish to go on trip or these weddings come up or holidays, how do you navigate that in a tradition that generally is not used to speaking about cash at occasions?

These situations are completely difficult. I do not wish to make it seem to be it isn’t going to be troublesome to face as much as the folks that you just love and say, “You understand what? I simply can’t swing this. I am engaged on different targets and that is simply not on the prime of my checklist.” You are going to must be okay with folks not getting it. And sadly, generally that is going to imply possibly offending any person.

However on the finish of the day, we’ve to develop a thick pores and skin with regards to staying true to what our values are and understanding that this short-term sacrifice goes to then mean you can probably be able sooner or later the place you possibly can splurge, the place you possibly can truly be the one which’s treating your loved ones to those superior experiences as a result of now you’ve got put your self in a monetary place to have the ability to achieve this.

I believe it is simply essential to keep up that long-term perspective and to know that not all people’s going to get it, however it’s not essentially for them to get.

Yeah, and that is actually motivating too. I wished to delve into a few of your particular suggestions and why they matter. So I picked out just a few to spotlight. First, your observe your wage negotiation script thought. I really like this one as a result of it is one thing my very own dad additionally instructed me about. So inform us why that is so essential and why it may be useful.

Yeah. Nicely, on the finish of the day, negotiation is an artwork kind. It’s a skillset that you must hone in. You need to work it similar to a muscle. And so I believe oftentimes when of us even begin serious about negotiation, it is normally within the context of a wage or a promotion. And that may really feel very life or loss of life for some folks. It is like, oh my god, if this does not go proper, what is going on to occur? And so I prefer to encourage of us to begin with the fundamentals.

Calling up your bank card firm and seeing in the event you can negotiate a decrease rate of interest, or when your renewal time period is arising for a streaming service and so they wish to double your charge, give them a name and say, “You understand what? I am unable to do that. I am solely going to remain on in the event you guys can match the introductory charge that I already had.” You would be stunned how usually firms wish to retain you as a buyer and are keen to make these negotiations.

And so the extra snug that you just get with these small issues, when there are greater issues at stake, whether or not that is negotiating the value of a automotive or a home or your wage, you are going to have extra observe and you are going to have extra confidence as a result of you are going to have extra of these wins below your belt.

Sure, that’s so true. The second I wished to spotlight is making use of the 50/30/20 budgeting rule. At NerdWallet, that is additionally one thing that we speak about so much. Are you able to clarify why it really works so effectively?

Nicely, I believe it is a good baseline for lots of people to know the place they need to be with reference to their fastened and their variable bills, in addition to their financial savings targets. Now, the factor that makes it an eye-roll state of affairs for lots of people is relying on the place you reside, these percentages might be wildly completely different. If you happen to reside in a really high-cost-of-living space, it isn’t unusual so that you can be spending 60, 70, possibly even 80% of your earnings on these fastened bills.

And so I believe it is a good baseline for folk to arrange their first budgets, however I do not assume that it is best to let it discourage you if you must tweak these parameters. As a result of on the finish of the day, budgeting is rather like private finance. It truly is an individual-based journey, and you must work out the system that works greatest for you.

And at last, you say create sinking funds, which I do not assume everyone seems to be conversant in that time period. So are you able to clarify how sinking funds work?

Certain. I really like sinking fund, and I had no thought what they have been till I began down the rabbit gap of private finance. And basically, you are simply creating buckets of cash for particular functions. I believe most people are conversant in an emergency fund, and an emergency fund is only a sort of sinking fund that you just’re saving particularly for emergencies. However I encourage folks to consider all of these targets that you’ve got, whether or not that is shopping for a house or upgrading your automotive or taking an expensive trip.

We will create sinking funds for all of those completely different targets that we’ve, and that means your cash is clearly earmarked for that goal. It is simpler to see if you’re making progress in direction of these particular targets as a substitute of getting your entire financial savings in a single pot after which hoping that you’ve got allotted sufficient for all the issues that you just wish to do. There’s one thing very visible about having the ability to monitor your progress for these particular person targets that makes it a lot simpler for lots of people to keep up that momentum versus simply having a pot of cash with no designated goal.

For positive. And in addition helps you keep organized, I believe, and simply ensure you’re on monitor.

Nicely, thanks a lot, Jannese. Do you’ve any closing ideas to share with our listeners?

Nicely, I prefer to at all times remind of us that private finance and getting your cash stuff collectively is a journey. It’s a marathon. It’s not a dash. And so the very best factor that you are able to do is simply be a perpetual learner, a steady pupil, and by no means be afraid to ask a query as a result of this world is altering so usually, so quickly. So continue to learn, continue to grow, and preserve making use of what you study.

That’s the good notice to finish on. Jannese Torres, thanks a lot for becoming a member of us on Good Cash.

And that is all we’ve for this episode. To share your ideas on cash, shoot us an e mail at [email protected].

Go to nerdwallet.com/podcast for more information on this episode. And keep in mind, you possibly can comply with the present in your favourite podcast app, together with Spotify, Apple Podcasts, and iHeartRadio to mechanically obtain new episodes.

This episode was produced by Sean Pyles, Melissa Lambarena, and myself. Tess Vigeland helped with the enhancing. And a giant thanks to NerdWallet’s editors for all their assist.

And here is our transient disclaimer. We’re not monetary or funding advisors. This nerdy data is offered for common instructional and leisure functions and should not apply to your particular circumstances.