BA Q&A: Should I Pay Off Credit Card Debt or Loans First?

and she's got Remy. We love an alliteration queen around these parts. So as a result, I'm here to act up all by myself and lonesome, but I'm gonna represent well for you, Mandy. Don't you worry, Sis, We're still doing baqa. So we are going to take your questions because I have some answers. But remember I'm not your financial planner. I'm not your doctor, I'm not your attorney. I'm not anybody that you give money to in order to answer your question. So that means sue somebody else.

Take what I say with the smallest of smallest of grains of salt and be well right. First question is a Mulah question and straight from the IG. So if you've got questions honestly, you can hit us up Brian and Bisson podcast on IG the BA podcast on Twitter, Briannabisson podcast dot com and click click contact us or ask us anything and we take questions all over the place. This is a quick one. Hey ladies, I've been listening for a while now and I love your advice. Okay,

I'm in need of some financial guidance. This year, I have done a lot of work on my home roof, gutters, siding, bathroom. It was all very much needed, but of course super expensive and a big headache. So then I took my family on a week long vacation to decompress. However, I have not recovered since. Financially we are a family of five. I'm assuming two partners and three children. I don't know, and I feel like things have increased in price over time.

Should I take drastic measures and focus on getting rid of loans or my credit card debt? I feel like even though my credit score will go down by focusing on the loans, it won't go down too much where it won't be such a huge impact. What are your thoughts, Well, we're going to call you new home. Who this new home? Who this? Well, first of all, let's get clear that your credit score is not just contingent upon your credit cards.

So let's just get clear on that your credit score is contingent on any money that you borrowed, or any money that you have not paid back. Right, So, if you have not paid like say your PC and G bill or whatever you know, cont or whatever utility bill or whatever that you have, that might go on your credit score because you have not paid that money that you owe someone. But if you also borrow money, your credit score is going to be reflective on how well

or how not well you pay that back. So your loans and your credit card debt are both contributing to your credit score. So I don't want you to think that like, oh, if I don't prioritize my credit card debt and I prioritize these loans, then you know that somehow they don't both contribute to your credit score, because they do. So if the question is should I focus on credit card debt or the loans, the answer is It depends like the adult diapers, It depends, right, because

it depends on who you are and how you are. So, for example, if you're someone who is emotionally charged by their finances, you might want to pay off whatever debt is the least expensive debt so you can get rid

of it sooner. So let's just say you've got three loans, you've got three credit cards right and own one two three, one hundred, two hundred, three hundred, four five six four hundred, five hundred, six hundred, and you're like, you know what, I'm gonna focus on paying off the loans or paying off the debt that I owe that has the smallest

balance first. I'm gonna pay off that one hundred dollars debt first, and then I'm gonna work on the two hundred, then the three hundred, then the four hundred, five hundred and six hundred. So if you're someone who needs that like extra boost of confidence that comes with paying off debt and the smaller debt first, then certainly you could do that. You could use a method called the snowball method.

That's when you list your debt from the lowest to highest and you basically pay that minimum to everybody except for that lowest debt. The lowest debt, you pay it it's minimum, plus you give it any extra money that used to give to other debts. So let's just say it's minimum, and you find another two hundred dollars that you can put toward that debt. So by the first month you'll get rid of that first debt because it's only one hundred dollars anyway. Then you roll over that

full payment to the second lowest debt. The second lowest debt is going to get first lowest debts minimum. It's gonna get its own minimum plus that extra two hundred dollars you have from your budget, so it's gonna get like three payments in one and when that's paid off, you roll over to the thud level's debt and you

continue until you pay it off. The benefit to paying off via the snowball method is as you get to debt with higher and higher balances, you start to collect minimum payments from prior debts that you've paid off along the way. You see. So that's if you're someone who was like like me, I need to emotion emotionally check things off my list, so I like the snowball method

to start. Now, if you're someone who's just super logical, let's just say you have this accounting kind of brain, mathematical brain, you might want to do something called the avalanche method and pay off the debt first that's costing you the most. And you know a debt is costing you the most because the interest rate is highest. So you're gonna do that same method, paying off one debt at a time while paying the minimum to everything else.

But instead of the lowest debt being paid off first, it's the debt with the highest interest rate that's going to be paid off first, because the debt with the highest interest rate is the debt that's costing you the most. So if you have a debt with like a thirty percent interest rate and then you have a debt with a five percent interest rate, you might say, you know what, I'm actually going to focus on the thirty percent interest rate first debt first, because that debt is costing me

a lot of money. For every dollar I owe them, they talking me thirty cents, you know, oh, child, So I like to do sometimes a mix of snowball and avalanche. So I like to see what debt can I pay off fairly quickly first, relatively speaking, and then slowly move toward debt that's costing me more money because the interest rate is higher. So that's what I would do. Ooh, but I would definitely set a plan. I would also

automate those payments and check in with it monthly. And good luck to you, but you know you definitely want to. You know, you've gone on your vacation. You have your beautiful house, so sit down and enjoy it while you start to pay off some of this debt that you owe, because one of the best ways to give your family a raise is to get rid of debt so you don't have to make that monthly pay All right, new house, who is okay? Hopefully that was helpful. Hopefully that was youthful.

Useful because I'm youthful, but hopefully that was useful because I know what it is like. I mean, I have been nearly three hundred thousand dollars in debt my condo at the time I was in my twenties. I bought

it for two twenty. Then I just finished my masters and I was like fifty two thousand dollars give or take my master's in education and then I had thirty five thousand dollars in credit card debt, which was a lot because of a scam that I unfortunately stumbled into, and so it left me, you know, about three hundred thousand dollars in debt and it was really scary. So I know how overwhelming debt can be. And it seems

like it's like something that you can't get past. But I promise you know that it's one foot in front of the other. It's writing down who you owe, how much, and what are the terms of the how much, and then slowly working your way through it. I was able to.

I had foreclosures, so kind of like the debt from the comb was wiped away because during that time, because it was the recession, they didn't make us pay Typically, when you lose a home to foreclosure the debt that you owe, you might still have to pay taxes on the money forgiven, which is who horrendous. But thankfully I didn't have to pay taxes on the two twenty because it was like I think President Obama or somebody at that time had put a law in place saying you

don't have to pay taxes on that money forgiven. Thank God, because imagine paying thirty percent taxes on two hundred and twenty thousand dollars. That's over sixty thousand dollars. Your girl didn't have the two hundred. How I have the sixty, you know. So that was one I was able to get rid of the house, which was hard because I had already paid five years worth of a mortgage into it. And then my student loan debt, I was able to basically

pause payments because they were federal loans. And then the credit card debt. I just used the snowball method and the avalanche method to slowly but surely pay them down. That took me. The credit card debt took me about three years of like hardcore going at it to pay it off. And then I worked on my student loan debt much more slowly because I was like the girl. The government can wait. The girl can wait. Okay, the

door all can wait. So I'm just sharing that as somebody who has been through owing a lot of money, and now your girl is debt free like a toddler. Your girl is debt free like Rammy, like Rio and Rammy Mandy's babies. Okay, I am. I own two properties, both of which I brought cast, both of which I've renovated. Cash my car that I own, I have bought that cash certified pre own a baby. They used to call it used cars, but we fancy now certified pre own.

I don't have no debt and so and I love it here because it keeps my lifestyle, my my monthly expenses low low Lou Lou lou. Look, it keeps them low, so I can maintain my lifestyle without having to worry about my monthly expenses. To me, let me tell you something about adulting. My thing is, I want to ask myself self. I want you to be able to afford this current life for as long as possible, if not for the rest of my life, you know, my rest

of my foreseeable life. And so one of the ways to do that is to try your best not to incur too many monthly expenses. And so wherever I can kind of cut out a monthly expense. So do I have credit cards, Yes, but I pay them off every full and full every month. I don't finance things like a couch and a desk and a lamp and a cat, things like that. Although there have been times when I've done that, but I tried my best, as my finances

has done better, to save and buy those things. I know everybody can't buy a house cash or a car cash, but I have worked toward intentionally putting myself in that position with my business the income I've made for my business to do so, because I want, no matter how much I make, I want to be able to afford my lifestyle. While I make, you know, a million dollars a year, or one hundred thousand dollars a year or fifty thousand dollars a year, I can fit within the life,

my bare bones basic lifestyle because sometimes things fluctuate. So just keep in mind that, like ideally, you do want to live a beautiful, wonderful life, but can you do so without incurring additional monthly expenses? That's really the key. Okay, all right, Well we're gonna take a brizz ake and we're gonna come back to being black and brown on

brown ambition. And I have another question to answer from one of our amazing listeners, Akau, see you in a few I am black, I am brown ambition, and I'm here by myself in a stew because, like I said, Mandy's just had her baby, honey, And because Mandy ain't here, we acting up. We do a business question. Next time, I'm gonna do all business Mandy, because who go stop me? Who go check me? Blue? You know I love answering business questions. And this one actually came from one of

my mentees this morning. She called me literally, it was a ten minute conversation, and she said, Tiffany, you told me about someone who was able to give one hundred thousand people on their email list in one month. But I don't remember how she was able to do, so can you tell me? I said, girl, I can't cause I remember, I said one of my other mentees she did something that I did. Now, I was not able to get one hundred thousand people on my email list in a month, but it took about a year, which

one hundred thousand people for this one thing. Okay, well, first let's dial it back. Why is it important to have people on your email list when you have a business. I'll tell you why, because you want to own access to your audience. Because the facebooks, if you're even still on there, the Instagrams like look, look, look what they're doing to tick off the talk, right, the girls was ticking,

talking and filling themselves. And now the US government is looking like they might say, girl, you know what's gonna be out of here in a minute. TikTok. She can't sit with us, okay. And so if they take TikTok out of here, what are these TikTok stars going to do? Right? If they say they change the rules Mark Zuckerberger, if he changes the rules down to the down to the

Facebook and the Instagram, what y'all gonna do? And so one of the things I learned very early on in business is that although you want to use these tools to communicate with your audience, ideally you want to own access to your audience. So what does that mean. It means can I communicate with my audience without the use of these social media tools that could tell me what

to do? Right? And so if you do, if you can't, if all your audience exists on social media and no place else, you are indangerble Molly, you in danger, girl ran right, you in danger? And so if we don't want them, and so here's how you get out of danger. You're gonna use those platforms to get people onto your email list. And there's a number of ways to do so to get people slowly, but sure you're on your

email list. And so my mentee, the one who got one hundred thousand people in one month, what she did was something that I did. You know. She was honest, she said, girl, I seem to do it. So I copied or whatever. I'm not even mad at that because I'm like, girl, the game is to be played, not I don't even know the other part of that, I don't. I feel like this is there's a quote there the game is to be played, not something anyway. So I put her on game and I'll put you on game tune.

And so one of the best ways. There's so many ways to get people on your email list. You can get people on your email list by offering something for free, like hey, do you want this free budget checklist? You know, people put in their name and email, they get the checklist. Yeah, everybody's happy. So one you have to choose. They call it a CRM. Don't ask me what it stands for CRM. I don't know. But there are like there's like mad mem,

there is Oh Goodness. I use one called keep k E a P. But keep is like the rolls Royce of CRMs, you don't. It's a lot of money and you don't need that to start off with. There's another one called I used to use called oh man, I forget the name, event don't get me the line child, But there are Basically these are just ways to collect people's emails and be able to email them. If you just google CRMs, you'll see there's one. There's one that was actually a really good one, but it wasn't so

expensive anyway. You know, your girl got the mind of eight year old sometimes, so do your Google do a little bit of work, right, So you're going to pick a CRM and then you're going to link You're like, So the CRM will allow you to people will like, It'll allow you to create a contact form where people will put in like, it'll say welcome dreamcatchers, this is

what I have. Like for example, if you want to get a goodie for me, I call my things goodie emails and one of my giveaways to get people on my email list. If you go to budgetistogodies dot com, for example, you will see like it'll say welcome, do you want to get a free goodie? YadA, YadA, YadA YadA. You put your name in your email in it adds you to my key email list, and then you get your free goodie right away. And then every Wednesday I

send out more free stuff. And it allows me Now when I'm launching a book, like I have my workbook coming out Made Whole and November of this year, when I'm like when my Netflix special came out Get Smart with Money, I was able to email the people on the list. So having a list means that when I have something to say or share or whatever, I can speak directly to you. Sure I can post it on social, but I can also land in your inbox. Okay, Okay,

So you're going to pick a CRM. That's one. Then two you're going to decide how to get people on. So one is to give them something free, another free thing that works really great. It's a lot of work though, but I created a Liverature challenge. A challenge is a great way. So challenges are anywhere, are typically from three days so minus three weeks long, where it's basically it's like a free course, but people are more likely to give their name and email if they're going to receive

something great and juicy in return. So my annual Literature Challenge. Well, actually it's I mean, you can always take that at liverature challenge dot com. It's free, but in exchange, people give me their name and email and a lot more so, because the challenge is three weeks, I don't just ask for name and email the registration email. I want to

know how old you are, where you live. The Liverature Challenge allows me every year to get a clear demographic of whom I'm serving, so I can tailor make things directly for my audience. So the bigger gift you give to the audience, the more you can ask of them. So I like to ask a lot when people set up for my literature challenges, because then I'm clear about oh I'm serving. This is like a specifically black women I see on here ages, you know, thirty five to

forty five. She's educated with the college degree. So as I build things, I know exactly who I'm building things for. So bigger thing you're giving them more things you're allowed to ask, so I know I'm doing this roundabout way I'm African girl. We don't get to the point. So the way that I was that my friend or my mentee was able to grow her email lists in the way that I did too. Another way was a quiz. So we talked about one a free downloadable something to

give away, two a challenge, three a quiz. So there's this site called out Grow out g r ow outgrow dot us. I believe in me see because I think I tink tink a tink outgrow owe ut out. Well, you know what if I go to gg wm forget Good with Money quiz ggwm mone yeah, gets Good with Money quiz, you could actually go see Outgrowing Action and yes it's outgrow dot us and so gg wm quiz. You can see my financial Hollness quiz. And what I love about it is that as I do is right

now at the bottom. It has a little window and it says and you can see it publicly. One hundred, one hundred thousand and seven, No, one hundred seven thousand, six hundred and sixty seven people have taken a quiz. So over one hundred thousand people have taken this quiz in the last like almost two years, which is awesome. If the quiz is literally it says your financial Honess quiz, and it says there are ten questions and each is worth ten percent. How close are you to being financially whole?

Take the sixty second quiz. Now. One of the things I'm saying here, One, if you're gonna do a quiz, what are the people gonna get? You're gonna get your score? And two how long is it gonna take me? That's why I have the button says take the sixty second quiz, because now someone can decide do I have sixty seconds? You know, and you know that there's ten questions and I love it because I can click on it and

the quiz an outgrow. What I like is I mean, I don't know if there's other options, but I use the thumbs up thumbs down. So it's going to take you less than sixty seconds to just say yes I have budget, No I don't have a budget. Yes I have this, No I don't have this. And what I love is at the end of the quiz, you can you can create your own on outgrow is it'll like.

So I'm just telling myself. I'm left. I'm saying no that I don't have any of these things, and Outgrow is going to give me a score of like of So before I get my score, guess what Alco asked me for They're like, girl, before you get your score, put your name and your email in Boom collected their name and email after they taken a quiz, so they're already invested. They're like, girl, I want to know my score and it says tiffing your financial honors score zero percent. Way.

But the good thing is is that I have on here like you can get it says want to stay and get one hundred percent Hohle pre order made Whole The Practical Guide to Reaching your Financial Goals, a companion to my New York Times bestselling book Gigga of Money. Here so you click on here and guess what it takes you to pre order the book. So what I love about quizzes is two things I was able to accomplish

with this quiz. I got your name and your email added to my list, and then at the end I can tell you about my new book that comes out in November. How awesome is that? You know? And then you might want to pre order it so it can

lead to pre orders. So gig of Money did really well in large part because I was able to collect a lot of name and emails prior to the book coming out for people who I knew were interested in something called financial hooleness, because the purpose of my two books, Get Good with Money and Made Whole is to get you to understand there's something called financial wholeness and you may or not be You may or may not be financially whole, but I can help you get there with

these tools. So do you see it primes you to say, hey, I'm not quite financially whole, but hey, Tiffany can help. Here's the tool. And then on top of that, even if you don't get the book, adding your name and your email to my list means I can tell you about the book or other products and services I have later. So having access to my audience is so critical. But do you see how that one quiz it answered so many business questions? Do I have access to this audience member? Yes?

Do I get to tell them about a product or service I have? Yes? Do they get to understand more about me by taking the quiz? Yes? Do they get to potentially purchase the thing at the end? Yes? That one quiz does like five things? Is that fourth things? Four things? Right? And so that's a quiz is one. It's an awesome way to get people on your email list. Now.

The thing is the reason why my mentee was able to get one hundred thousand people in one month is because she has over two million people on TikTok that follow her and she goes viral quite often. So I don't have two million people on TikTok. I don't you know. I don't even know if I have ten thousand, might be like two thousand. So it took me longer to get to one hundred thousand people on my quiz. But

that's okay, you know. So yeah, I'm not saying you're gonna get one hundred thousand people on your list in in a month, but what you will get is somebody, you know what I mean. And then what you want to do is when you get people on your list, keep it warm. What does that mean? It means at least monthly reaching out to your list to add value to someone's life. Here's a free tool, here's a free checklist. Here's a video that helped me. Whatever it is, whatever

your fitness, you know, vaginal health, I'm moving there. Whatever it is that you teach, you can keep your list worm. I do a weekly email to keep the list warm, and I'm always pouring in and giving. So every once in a while, once or twice a year, when I say here's something that you can buy, the girls just like say lasses you've been given, I love it. You see what I mean? Doesn't that makes sense? Girl? I mean knowing what stuff. It's been fifteen years of business,

over forty million dollars made. Yes, Brown Girl Tipany has done all of that. Bland Girl Tivity has done all of that. I have many a mentee and if you want to be a mentee of mine, I don't take on any more one on one mentees, even though I always say that, but someone always wheezles their way in. But the good thing is that when I talk to my one on one in person mentees about I also

talk to like my mentees online. There's over about thirteen hundred mentees that I have, and we have a monthly chat where I teach a live lesson or do a Q and A and the mentees actually meet with each other weekly get to connect with each other, and then every month for any new mentees that might have joined that month, they have a networking session. They just did a fun one where it was a game night, which

is so fun. Okay, So if you want to be a mentee where you know you're gonna get a lesson from me every month live and then they're recording you can watch later. Connect with other mentees weekly if not daily, because we have like a chat every week. I also give like some sort of tool that I use in my business. It's just a really awesome place. It's only ten bucks a month for now, because I'm not gonna lie. The prices going up. It might be twenty by the time you listen to it. You lost out in the

ten bucks. But it's ten bucks a month currently right now as I'm speaking, and it's available at my mentor Tiffany dot com. That's my mentor Tiffany dot com. We'll put it in the show notes. But yeah, if you want you I just want to say, if you want my body and you think I'm sick, name that artist, tweet me who sang that song. Tell of y'all too young. You're too young. That song was a jam back in

the day. So if you have a question and you want it answered, you know, hit us up Brana Bischen everywhere and we will help you and I will try my best to pour into you questions about business, questions about money, questions about career. We are here for you. I'm here for you. And tell me Andy, I've been all my best behavior, okay, Tell her I was the only singing just a little bit, and that I was real good. Okay, all right, until next week, y'all, I will see you on the ba QA Bye hey, ba Fam.

We could not do this show without your support or the support of our team behind the scenes. The Brown Ambition podcast is produced by Imani Crosby and Dennis Stanplinsky is our in house tech guru, I and your co host Mandy Woodrif Santos and we will see y'all next week, ba Fam.