Looking to pursue financial freedom on your terms? See how Rich and Regular's Kiersten and Julien Saunder's book Cashing Out can help you lay out a path!
Why Your Family Needs a Financial Plan
When I mention this idea of having a financial plan, people tend to imagine is only for those who already have some money. But that’s not true.
Many families can benefit from creating a financial plan.
Here are a few that come to my mind:
- you’re feeling under-appreciated and underpaid at work
- you want to have flexibility, leverage, and options when it comes to how you work
- the pandemic really threw your finances for a loop and you’re looking to get back on track
- you’re sick and tired of the opportunities (or really the lack of them) that are out there for your family
- the idea of financial freedom and independence is something that excites you because it means you’ll have more time for the people and projects that matter most to you
These are all situations where having a flexible financial plan makes sense. The trouble is that financial plans seem complicated, unattainable, and well, boring.
Here’s the thing – you can create one that reflects you. Your situation, your priorities, and your goals.
Kiersten and Julien from Rich and Regular are on the show to share some thoughtful points and stories from their new book Cashing Out: Win the Wealth Game by Walking Away.
It offers a framework and path based on key principles in financial independence and retiring early on how to build your family’s finances in a way that opens up options.
In today’s episode, we get into:
- Why money matters and how to use it in a meaningful way for your family
- The challenges and triumphs of changing financial habits and mindset
- Aligning your finances to your priorities
You can listen to or download the episode here or read the edited transcript below.
Hope you enjoy!
Resources for Families Interested in Financial Independence
If you're looking to get ahead with your finances as a family, here are some resources to check out!
- Best Budget and Money Apps: Personal Capital, Tiller, Mint
- Jumpstart Your Marriage and Your Money
- Cashing Out: Win the Wealth Game by Walking Away
- Rich and Regular
- Money on the Table
- Which Financial Independence Path is Right for Your Family?
- Crafting Your Family’s Plan for Financial Independence
- Retire Early By Rethinking Your Priorities
Join Our Thriving Families Community on Facebook to chat with other families and swap tips and stories about working towards financial independence.
Thank You to Our Sponsor Coastal!
Support for this podcast comes from Coastal Credit Union! If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today.
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Financial Freedom By Cashing Out
Elle Martinez: Last time I chatted with Kiersten Julian on the podcast, we talked about real estate investing. One of the things I immediately appreciated was how they gave an honest account about the pros and cons of managing a property.
One of my goals on this podcast is to be honest about family finances so you can be better prepared.
With their book cashing out. Julian and Kiersten take a similar approach. Yes, it does address the mechanics of financial independence and freedom. But they don't discuss finance in a vacuum. There are a lot of ties into the real world. And that struggle of juggling all your different goals, taking care of your kids. And in some cases, helping out your parents.
That's actually how the book begins. Both of them had a parent get hit with a health crisis. That opened up their perspective about so many things including believe it or not money.
Kiersten and Julien Saunders: Those particular stories that we share are not just personal, but I think there's stories that a lot of people, especially working professionals deal with. I also think, unfortunately as one of those things that just continues to catch people by surprise.
Especially when you're parents, you are so like head down focused on your children. You kind of forget to think that your parents are aging, as well. As the age, they tend to have these health challenges that don't just disrupt their lives. They disrupt your life as well. Depending on their situation, you could impact how you spend your money, right?
It was really just a wake up call for us. In Kirsten's case, it was her father being a hit with cancer. In my case, it was my mom facing some pretty intense blood pressure issue and she wasn't quite able to kind of solve it. The good news is they both have got over the hump.
As we started thinking about that and asking them questions, what we really learned was that like, they come to what to do, right? Like they weren't surprised by any of this stuff. And it's not to say that they're bad people or that they irresponsible. I think what it really does is it just highlights that this is kind of, part of the human experience is certainly a part of American culture.
In many cases, we know what to do when it comes to money. We know that we're actually spending more. We know we should probably be asking certain questions, but all of the other parts of life kind of get in the way. And as a result, you kind of end up in a sticky situation. We just thought that there was an interesting parallel and something that a lot of people could actually identify with.
And so sharing that story we hope that people can kind of see themselves in that situation as well.
Family Finances Is More than Just the Numbers
Elle Martinez: I know reading it. I definitely connected with what they were saying. I mentioned before that during the pandemic, my mom moved Raleigh.
She wanted to be closer to the grand babies and us. Because she has respiratory and other health issues. I was the one physically out there with her real estate agent house hunting.
Thankfully we found the place within her budget not far from us. This decision in turn affects us and that we can drop off the girls for overnight stays with her. So again, Uh, family and finances are so much more connected than we realize. That's what I loved about the book.
It does take you through how to create a financial plan and have this vision. But the reality is finances, it's all in context. What's going on with your kids? What's going on with your parents. You have to have a certain amount of flexibility. 'cause you never know when you're going to get thrown a curve ball.
Another big moment I had while reading. Was seeing how their parents made significant changes with their habits. With both cases, a health issue was the motivation to get them to what they already knew they should be doing. With finances. It can be a bit of the same mentality. Change can be hard, especially if you're doing something significant, like working towards financial freedom or independence.
I was curious about how Julien and Kiersten themselves handled it.
Kiersten Saunders: I think for me, it was two of them because I'm in the camp of people who have always focused on income. And so earning money has never really been my challenge where I encountered challenges where some of them. That you're talking about now and then just the overall financial habits that I had.
My first one was unlearning the habit of always looking for validation from my friends and family. I would decide that something was a good idea. I would feel confident about and something like index funds or setting up a 529 for my son.
Then I go and tell people and I'd be really excited about it and they would come and express their doubts. I would take that as the idea of being less credible. So I had to unlearn the habit of seeking validation. Now I can share, and I really don't care if they agree or not, because I've already put this what I'm doing.
The second habit that I had to unlearn was my endless optimism. Not allowing me to save for things that I know inevitably would happen in the future. So it was more of a savings mindset. I think I thought of savings as like the absence of income. And so I was a good with an emergency fund, but I wasn't saving for things that would inevitably happen.
Needing new tires, needing to replace a refrigerator needing, like all the bad things that you can just don't account for that your goods and products don't last forever. You're going to need to replace these things.
As I started thinking about saving as money that I'm going to spend later, it became much easier to actually set aside for the things that I know I want to do. Take vacations. Update my wardrobe. So that's been hard for me to change, but that I've worked on.
Pursuing Financial Freedom in a Broken System
Julien Saunders: I'm in a similar boat. I actually had to confront my own issues with optimism. But mine wasn't necessarily around a habits. It was really around the workplace. I was very optimistic. You know, feel really good about the company or the department or company culture kind of based on some of these big splashy diversity messages.
I would always feel like change was coming. And I always felt like, things were just on the up and up and we were not going to be our parents' generation.
Then, life happens right? Really no different. It happens both outside of work and happens inside of work. And he starts to see and get confronted with things that you really have to do. I think for me, it was a huge reconciliation of uncomfortable truths.
The uncomfortable truth was that we'll be looking at the broader set of economic factors that were impacting the black community many of the those have not changed since the 1960s. So with respect to home ownership rates, like the same percentage of black people in the United States own a home today as they did in 19, in 1968.
There were studies that were coming out in the late 2010s that were talking about the pace of black wealth or median black wealth, which was actually slated to be zero by the year 2053.
Again, these were numbers that were slated prior to the pandemic. When you factor in the loss of homes, loss of income and all of these other things, it's pretty safe to assume at this rate, that things are actually going to accelerate that median wealth will be zero for the typical black family far sooner than 2053.
Very few people, wake up, wanting to talk about those things, but we really had to confront those things and say, all right, what does that mean for us? What are the likelihood that corporate America will continue to fail miserably at creating equality at paying people fairly for the work that they do and so on.
The effort for us, kind of all culminated Figuring out a way to ensure that we protect our finance to wellbeing and figuring out the way that we protect our relationship and our family in the event that history repeats itself.
Elle Martinez: Yeah. Honestly, it's frustrating in sad. This past spring, I was invited to speak on an online panel for mothers working to improve their family finances. And I looked at some similar data that Julian had mentioned. And I think this brings up a good point.
When we're talking about money. We cannot just focus on our immediate needs or immediate family, but look at the bigger picture in context.
This can help us to have more meaningful conversations about things that do need to change, but then also, how do we need to adjust our family finances to deal with the reality of the situation?
Why You Need Your Own Financial Plan
Elle Martinez: Every family is going to be different with what you're dealing with, what challenges you face. That's why personal finance isn't a one size fits all approach.
It's great to get information online and in books and podcasts like this, but just understand that this is just one piece of the puzzle. You really have to tailor it for your specific circumstances.
For example, in our family, we have two different cultures. Initially we didn't even consider this. But from there, we have different expectations about certain circumstances. For example, when our parents get older, what's going to happen.
And these are ongoing discussions. We try to be respectful and understand where each other's coming from, but that doesn't mean there aren't moments of some tension, some friction. That we have to work on until we find a compromise we're both happy with.
And we shouldn't feel like we need to avoid or kind of tiptoe around these difficult and maybe awkward conversations. In fact, this is an opportunity for real growth.
With our marriage and finances, they both improved. We were more honest and open about money and how we feel about certain things in the situation.
And yes, it does take time to work out a solution that you're both happy with. But it makes it more meaningful and it keeps both of you on the same page and on the same side.
I'm always curious about how other families handle their finances. So I had to ask Kiersten in Julian, how they approach their finances and talk about it.
Kiersten Saunders: I would say we're probably on a monthly cadence. Depends on the month. Sometimes as bi-weekly, when we're talking about the numbers associated with them.
A lot of times we're talking around money, we're talking about the larger factors that contribute to the way that we earn or the way that we spend. Those conversations are happening almost daily. We're talking about, the ads that we're seeing, we're talking about how credit cards are now positioning debt and new and innovative ways and how these new financial institutions are creating. Concepts that are really just old concepts you know, change names.
And so we're always talking about money and then we probably look at our personal finances bi-weekly or monthly on a regular basis.
I'll say we've never been lazier with respect to budgeting the name. I feel like that's a bit of an earned privilege. You just reach a certain point where so many of these things become Muslim or just flat out on a wearable.
I'm sure there's some, there are savings opportunities that we could uncover if we were to dive back into the budget, but to Kirsten's point, we're very fortunate in that a lot of these problems or challenges that we face are whatever my pop-up can be solved through income.
And so the business that we have and the position has allowed us to to tackle that problem by focusing in, on another part of the equation.
Yeah, it's an interesting, I'd never really thought about it. So you asked that question, but it is a by-product of not being under the fixed cadence of every other week.
I get a paycheck and it's the same amount. And I got to figure out how to pay the bills that I have within this month, within this fixed amount. We now understand that our upside, our earning potential is basically unlimited.
When we anticipate that there will be higher expenses, we've been turn up the income dial. When we anticipate that the income dial isn't doing what it's supposed to do, then we can turn down the expenses, but it's a very fluid relationship. I would argue to Julie's point. It is an earned privilege of being a business owner.
Better Conversations Around Money
Elle Martinez: Yeah; And if there was a time or reason to pay attention to your finances, I think these past two years were it. If you were making great progress with your finances before the pandemic hit. You were typically in a better position to have more leverage and make decisions that were best for your family.
Unfortunately, if you were just starting off your financial journey. From conversations with friends, family, and some of you in the community. It really was difficult. You almost felt like you were forced into these situations.
It literally was a matter of we're living paycheck to paycheck, and I need to take care of the necessities and take care of my family.
Many times on the podcast I say money is not the goal, but it's a useful tool. And I hope you see it that way. We shouldn't be chasing a particular number, but really looking at, ‘Okay. If I have my finances in a good spot. What are the options that I have to help me make better choices for my family?‘
Julien Saunders: It's something that we actually talk about pretty regularly. Even within the black community, there's a lot of diversity that a lot of. I think people don't even really acknowledge this.
What I mean by that is while I do identify as black culturally identify as Caribbean and specifically I'm from Jamaica, which brings it's entirely different set of nuance conversations and beliefs.
And in some cases, even languages and approaches to managing money and respect and caring for elders and all of those things that Kiersten proves family is mostly from the south, from Texas. She didn't have any of those challenges. Right.
Then on top of that, you have the fact that we both come from two different socioeconomic backgrounds.
So she comes from an upper middle class, a dual household earning family. Whereas I come from a working class, borderline working poor single income family. I was raised by my mom for the most part. And so there's a lot of backstory there that obviously influences how we are in how we think about our lives.
But when we even look at our lives today we financially support my mom. She's sort of built into the budget. We've gone to the extent of bringing her closer to us so that she could have a better quality of life and such now. I see our son, her best friend only grandson. As often as she wants, she can pick them up from daycare.
She can come back for dinner, she can hang out with us on the weekends and she's literally just five minutes away. But that doesn't mean that it's always rosy, right?
Like it very much, it's still a part, a point of tension, just being honest. It's something that I struggle with because again, We know that we would just pull back just a little bit, right, and invest that money. We could expedite potential plan. So we could really put that money to, to other uses.
But having had a lot of conversations with people elders, mentors, it's one of those things that I think is truly priceless. So right now we categorize it as giving our son, the benefit of building experiences with his grandparents, which is something that we did not have.
I have entire sets of grandparents that I'd never even met, whereas our son has met his great-grandmother. We have video of that. We have video of his, Grandmother and great-grandmother being there at the moment he was born.
So all of these different things to take trips and, you know there are financial implications to it now, but I think in our book of our family, it's considered money well spent.
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