It's time for the ba qa A the ba qa what to say? The v a qa with Manday, the va qa and Tiffany A the ba qa A. Okay, I lie, Tiffany's not here, y'all, She's not here. She left me solo today, but not for long, because I am joined by our brilliant guest. If you haven't listened to her episode about her brand new book, Your Journey to Financial Freedom, why are you here? Going back to Wednesday's episode and check it out. Jamila sous frant is
in the house. Hey Jamila, hey girl, Hey, long time nothing I know, right, so excited to have you on. So in the baqa. First, we got to start with our disclaimer, okay, Jamila, because we ain't trying to get you sued. You just got here. We are your financi You can call us your financial sisters, your financial besties. We are not your lawyer, not your financial advisor, not financial planner, not your investment advisor, not anyone that you would pay for advice. So take everything we say the
grain of salt. Okay, we got brains, we got smarts and all of that juicy goodness. But no, please, you can just send those you know, send those send those legal fees somewhere else. Okay, we don't have time for that. Let's jump into some questions, because Jimmy, let your book is all about your journey to financial freedom and helping others feel what is possible for them if they take some steps in their lives today to get to their
own version of financial freedom. So we picked out a couple of good questions from our BA fam that we're going to read today listen. As a reminder, y'all can submit your questions at Brand Ambition Podcast on ig slide into our DMS, or you can go to Brandnambisson podcast dot com and click ask us anything and submit your questions there. All right, Number one? You ready?
Yeah, let's go.
Little shoulder shimmy, little shoulder rub rub, I wish shoulder rub, little shoulder stretch. All right. The first question comes from IG from listen, Ana Anna says, hey, ladies, First, thank you so much for creating this space. Finance credit savings investing is so overwhelming to me that I just turn away from it. But I can't afford to do that any longer. I picked up Get Good with Money, Tiffany's book, and I'm ready to put in work. Yes, My question is should I invest in a four to oh one
K or a wroth I? Ray, I have zero dollars in either of these right now. I'm an immigrant from Dr Hey Mandy High girl Ola, and no one in my family knows how to navigate American finances. I'm thirty one years old and I want to retire comfortably around fifty five years old ish. Any tips or reality checks are welcome. Okay, Anna, Anna in the house. Okay, So she's got this feeling that her family doesn't know how to navigate American finances. She's on her own, but she's
ready to do something, all right. But the question itself is pretty simple. One K or wroth Ira, what do you say?
Okay, so this is gonna be Yeah, it's gonna depend on a couple of things. So if you have access to a four to one K through your job, so one, you know, make check that out. Make sure that you do have access. Do they give you a company match, meaning if you put in a certain percentage or a certain amount, do they also match you up to a certain point? Because if you can, then you should be investing up until that point in which they can max or match you in your account. It's almost like free money.
I do air quotes because technically it's not free, like it's part of your compensation package, so you should be using it, and you know start there. So, do you have a four to one K? Does it have a company match? If it does, you should invest up into that company match at the minimum. Also recognizing the difference between a four to one.
K and a wroth IRA.
So typically the four to one K will be through a company. It's a company sponsored pre tax retimement plan, meaning the amount you put in reduces your taxable income so you actually pay less in taxes or it makes your net income less. And then a wroth IRA is an after tax retirement vehicle that you can use and open up separately with a brokerage company outside of your job. And that's after tax money, meaning you pay taxes on that money already and you're now putting it into this
roth iray to grow over time. So I always like to think about what is your income level, So people who are typically higher earners like to put money in their four one K and pre tax retirement accounts to reduce how much they need to pay in taxes. So it's a smart tax strategy and just it's helpful to
put money away. Or if you're not earning a lot of money and there is a limited amount, if you do have that match, do up to the company match in your four to one K. But then you can also take and use your after tax dollars to invest in a roth ira if you're not earning a lot At the moment.
I was just looking up the limits for four oh one K because I haven't had a traditional job in a few years, so I'm like, what is the limit now? God, I miss my four to one K. It's so easy, y'all. People make you know, business ownership looks so cute and sexy, but it's more complicated. Okay, I miss my cute little cozy four one K. I got my little auto payroll deposit.
The limit right now is twenty two twenty two, five hundred, but in the new year, which is just around the corner, it's going to go up to twenty three thousand, So if you get that match. I mean, I always kind of went by the rule of max out the four to one K or try to because it's hard to get up to that, like save twenty two something k a year. That in and of itself is a huge,
you know, a huge accomplishment. And then my financial planner was always like, you know, okay, once you get past that, then let's move on to the ROTH because you can save less in the ROTH. Ira there's and there's income limits, so there's it's a bit more like complicated. And when it comes to financial steps again, I'm not a financial planner.
I'm always like, what's the easiest path to entry? And for so many of you listening, including you, anna go to your payroll department, your HR and be like, how do I enroll in the four one K? And make sure they tell you and they probably told you at orientation, make them tell you again. That's their job. Okay, Jamila. Now I'm curious because you're Jamaican and you were born in Jamaica and your mom brought you here? How did
that work? But I want to know, because she obviously wasn't from here, how did she navigate her finances in America?
Listen, my mom was a force because she came here at twenty years old, and yeah, she left me behind in Jamaica when she had me to establish herself a bit and then I came to join her just a few months later. But she did with no internet, no phone, so quickly you type up to find something. She yellow pages and showing up to places that said they would be open, you know, looking into resources and getting on
government assistance in the beginning to help sustain herself. And so it did take a lot of curiosity and tenacity, and at such a young she was only twenty years old. Like again, I can't imagine doing it by herself, for right, and so in a country.
She had to leave.
Right that part, So you know how it is being a mom now, I mean, I get it. I talk about this in the book Your Journey to Financial Freedom, that you know, for her to forge a path like go to the country she's never been, to experience seasons she's never experienced for the first time with barely any money in her pocket, how bold she must have been
to be able to do that. And so like the the call for us to try to attain financial independence is bold, right, Like Anna now is entering into this stage where she's like needing to make a big decision, and it is big for her, you know, and it can change the course of her life. But It's just like, think about what your parents or your your ancestors did to put like to get you here, and how probably you know it wasn't like their money that was at risk,
it was their lives and livelihood. And that always gave me the courage. I'm like, you know what, I can call hr, I could do this. Yeah, I can ask this question and so use that as your motivation to get you going to do something different because just because no one in your family, look, I get it. No one in my family also talked to me specifically about investing. These are things I learned on the as I got older and especially on my journey. But you can be
the first. You can change that and then be the person that you know puts your family on and your cousins and you start to help other people when you have the knowledge and information right.
And I just want to say too that when you're on this journey and you know, I would say, gather friends confidants as you go along who were on the same path as you. Because family is amazing. But family doesn't always understand the journey that we're on because they have their separate journeys. So I just feel like the more voices you have, whether it's hours from listening to the podcast. I'm happy that you found BA, but also Jamila's podcast Journey to Launch. It's a great one to
add to the mix. So you yeah, we can be like your big sister friends who can give you these ideas and help guide you a little bit of the way. But to take ownership of your own journey. And you're only thirty one, you're so young. Fifty five to me does not seem like out of step with reality at all. To have a goal of you know, being able to retire or at least being used to say it's comfortable, of course, like fifty five, Like that's twenty five years
almost that you've got to invest. I'm like, start now, Yeah, let's.
Go to it. You got you got a lot of time, and it's never too late. You know, it's never too late.
You'd be surprised how much ground you can make up once you just start, because as you start, you may not know everything you need to know right now, but as you start going, you start it's like picking up gems you play in a video game, right and it's just like you picking up these gems and tools and it becomes like a big effect, a snowball effect, and things start accumulating faster that you could have ever imagined. So just start and this is a great start for you asking the question.
Absolutely. Okay, thank you, Anna, thank you so much for sending in your question. We're going to take a quick break and we'll be right back with more of the Baqa with our guest Jamila Soufront of Journey to Launch. Hey, ba Fan, we are back with question number two. This question comes from a listener who'd like to be called Manifesting Wealth Babe. Okay, I feel that I'm excited to hear from you, Manifesting Wealth Babe, because you've been a
long time listener. Let's get into this question. Hey, Mandy and Tiffany. She says, I last wrote to y'all one and a half years ago when I was seventy five hundred dollars in credit card debt and seeking advice on how to pay that down and buy a house. Well now I am credit card debt free, yes, and I'm getting the keys to my first row home next week, which will be my primary residence. Come on, this is amazing and just one and a half years that is phenomenal.
I'm also starting a new job where I'll be making fifty k more than my last one. To me amazing, like I shook it. Wow, you did the damn thing, girl. This is incredible. Okay, starting a new job making fifty k more. Since my mortgage interest rate is at seven point three seven percent ooof yes, it's so expensive out there right now, I'd like to pay now my house as quickly as possible. I figure that I can put that fifty k a year toward my mortgage by tripling
my monthly payment. What else should I be doing to make my money work for me? I have several four to one ks from different jobs throughout the year, but I don't keep up with them, and I don't know the collective total. Should I start focusing on building that up, put more money toward my emergency face savings, or start investing. I've got a six month emergency fund, and since I'm using some state grant programs, I'm technically not supposed to
rent out my house for the life of the loan. Okay. Interesting. Any advice on next steps now that I've got my head above water would be greatly appreciated. Things for all you do ooh, Okay, got to celebrate those wins. Yeah, but now it's the Okay, I did the dirty work, paying down the debt, doing what I can to get access to I love the idea that you use grants, some state programs to get your first property, but fifty k more and thinking about tripling her mortgage payments? Why
does my chest kind of do like it? When I don't know, am I wrong? I kind of feel like, don't do that? But I don't know what. I don't know what exactly I'm thinking yet, what do you think?
All right, there's a few things here. So the first is, oh my gosh, congratulations, you are doing the damn thing. You'd be primed to like join me on this journey to financial independence because you're the kind of person where you're a journey to financial freedom because you have so much, so many assets in terms of what can help you on this journey leap frog you forward very fast through these stages that I talk about to reach financial independence.
And so first this is going to just be technical, but I would like you to go search down and find where your several four one ks are, so you know, a task is to where are those four one k's located.
If you got in the book, honey, right.
Sit down, call those companies up, get the log in information and it might be best served that might it will be best served for you to probably roll those all over into your own you know outside what would
happen is a traditional ERA. So because it's a pre tax four one K, if you roll that and took that out of your companies who's ever holding it and put it into your own ERA account, you can roll that over and combine everything just so you can have it all in one place and be more direct or active in knowing what the numbers are and where you're invested, because you don't know if the company's charging you overcharging you to help manage these investments when you can park
them on your own somewhere else in a mutual fund that has a low fees. So just one get that information for all your accounts, consider rolling them over into one and talk to a tax person. So at your income level, I'm assuming it's a lot more now you know it might be best to talk to someone who
can help navigate and manage this for you. The other thing is that you're you're going to have a very huge increase in income, So investing in a four to one K to help manage taxes, right, you're putting away for your financial future and financial independence, but you're able to lower your taxable income because you know, when we make more, that's when the government comes in and they tax us more, which is not always a bad thing.
You know.
I am for paying taxes because this country needs to run some way. So but if you can then increase your four one K contributions at your current job, that will help to reduce how much taxes you pay and put some money away for yourself that you can use. I think the other thing I didn't want to mention before, Mandy, I want to hear some of your feedback is that you know, the biggest thing is that you don't have to make this complicated. It seems like you pay down
your credit card debt already. The interest rate is very high, So I just keep your eye in the interest rate to see when you can refinance at a lower rate once they start dropping, because in a couple of years they will. But for me, I wouldn't necessarily put all of my money or additional money in the house just because you know, it's a non liquid asset. You know, to tap into that money. It would be a lot harder if you need it or need to sell or
whatever the case like. In order to tap into the equity of your home, you're going to either need to sell it or to take out a home equity mortgage versus you invest that money and you can maybe beat I mean, this is a high interest rate, but if you can beat the average of what you're paying any of your mortgage, it maybe makes sense to do it that way. But I wouldn't discourage you. I do the math on how much do so would I pay or how long will it take if I do triple these payments?
Does it shave off five years? Does it shave off only like? What does that look like? And less cash flow? Does that matter more to me versus increasing my assets on the other side, versus increasing my equity in my house? Mandy, what do you think?
Yeah, I love a lot of what you said. I think the reason my stomach was kind of turning when it came to the idea of tripling their mortgage payments is like the high of paying down debt. You know, you get that this is like the Dave Ramsey way of paying down debt. Right, just like attack, attack, attack.
But I agree it's going to put you in a financially vulnerable situation to tie up even more of your money in a house, especially like like like Tiffany, Sorry, Jamila, Tiffany, I miss you, Like Jamila said, you know, it's it's something that you can It's not a piggy bank. People treat it. They think you can treat like a piggy bank,
but it takes time. And even during the pandemic, banks were like stopping giving home equity loans because everybody was like, oh, my home, my home prices have gone up so high, my home values have gone up so high. I want to, you know, tap into this. And thanks were like slow down, so and and I like the idea because you have, you know, paid off your debt. I think that's incredible. You can keep that good feeling going, the high that you get from paying it down, But don't put that
energy into your house. I would say, put it into your investment account, in your in your emergency fund. Six months is great, but you're a homeowner now, and these homes be homing, okay, Like I moved into I bought my house five years ago, and it's about that time, the appliance has start breaking down on you, and I'm like, wait a minute, didn't I just spend two thousand dollars on this washer dryer, you know what I mean? And it's like, oh, well, this is what happens. Now you
got to repair stuff. The prices, you know, the cost goes up. Also to make your money work for you. I feel like there's no better place at this stage for you then getting some of that money into the market, and whether it's like getting all your four to one ks all in one place, which I absolutely I would even go further to say, girl, go round them up
and get them in one place. You can't be losing track of money like that, like leaving money under the couch cushions, because for example, I forgot about like a little tiny baby for one K I had from a job that I was at for just a hot minute a few years back, and it was like fifteen hundred dollars and it was just putting a money market fund, earning negative money, and I missed all the fun ups of the pandemic. You know, I could I could have gained a lot on that a little bit of money,
but it was just sitting there not invested. Excuse me. So, I think if you want your money to work for you, figure out a way to leverage your increase in pay in a tax savvy way. I agree with Jamila about reaching out to a tax professional, but you know, I think it is simple open up or start contributing to your pre tax retirement account through your employer and start letting that money continue accruing on the side while adding a little bit more to that emergency fund. It's up
to you sort of what your magic number is. Six months sounds good, but I'm honestly, like a as a homeowner, I'm on that, like you know, nine to twelve month, yeah, expenses kind of train like I yeah, especially having survived a couple of processions now. But that's that's really up to you. But my message is, let's sink more money into your investment portfolio than into your house right now.
And if I could just add so One of the things I tell people to do in the book to help map out their journey to financial independence is that you have to assess where you currently are. You have to know your numbers and so you have to know
your income, You have to know your expenses. You have to know how much you owe sow your liabilities, and you have to know how much you own your assets because your assets and accumulating more eventually allows you to retire early or quit that job, or do whatever you want because your assets will pay for your living expenses.
But if you don't know how much you have or where they are, then you don't know your starting point, So you don't know you might be further along that you can even know to reaching financial independence or your journey, but you just don't know that you're not counting that
money because you don't know what it is yet. Versus, sit down, get the numbers together, look at look forward on where you want to be in twenty years, how much you would need to feel financially independent in your investment accounts, and that way you can map out what it looks to what does it take to do that? You know, I have maybe fifty thousand dollars in the four to one case combine now I want to maybe
have a million one point five million. You know in ten fifteen years how much you need to invest over time to do that? Right, which if you can't do that if you don't know your starting point. So you know, everyone assess where you currently are. You know, rip that band aid off. If you've been avoiding it, it's okay. You'd be surprised at how much further along you are.
Then you think, oh, in one little tidbit, I forgot to mention that I popped into my head. If you're going to pay extra on your mortgage down the line, you don't have to do it all right now. You can do it down the line. I think that's generally smart, because you know, it's generally smart because it could. It could if you do it the right way, pay down
your principle a little bit faster. But I will. I do want to note you have to tell your bank to apply it to the principle because, honey, amortization, I hate that word. It always wants to stay stuck in my throat. Amortization is basically how banks structure the payments of your loans, and from the beginning it is like almost all going toward interest, okay, and in your case, probably all going toward interest. So unless you say these
extra dollars must pay down the principle, they won't. So if you're going to do that, anyone listening just make sure that you check that marks on your check that box on your mortgage payment, and make sure that you talk to them to be sure it's being applied to the principle. Okay, Manifesting Wealth Babe, I just want to give you more snaps because it's incredible what your progress is. I'm so excited for this new chapter in your journey.
Please keep us posted, all right, And it sounds like I'm going to buy you a copy of Jamula's book your address, Manifesting Wealth Babe almost send it to you. Your Journey to Financial Freedom by Jamila su Front is available now wherever books are sold in the website your Journey to Financialfreedom dot com. I got it, I get it right, Yeah, yeah yeah, Jamilus is so fun. Thanks for joining us on the d a q A and we'll see you all next week