All right, ba fam welcome. It's Friday, and y'all know what time it is. It's a b a QA and I have got a lovely guest in the studio with me, mister Chris Browning Popcorn Finance Welcome.
Thanks for having me. Maddy always get talking with me.
Yeah, I feel like you have some nerdy knowledge that I don't and some like pretty obscure topics. And this is not a dig I don't know why you're laughing like I'm making I'm not.
This is a compliment. It's not like you fight.
Let me run it back in my mind. You have some nerdy knowledge too. Yeah, yeah, I don't see that's a compliment. You're welcome. You're welcome from you.
That's a compliment.
Thank you, truly, truly, truly. But you do have some great like nuanced knowledge and like the nitty gritty of financial topics. So I'm excited to have you in the studio today. Welcome to the BAQA. We're kicking off the new year with some juicy questions. We're gonna tackle one that's like a mix between four to one k excuse me, and life insurance, and we're going to tackle another one that is all for a one K and pretty confusing
like match situation. So heading into the new year as employees trying to figure out your employee matching your four to one k stuff, we got you. But before we get into the questions, just a little disclaimer, like, don't come sue us. This is just for purely financial edutainment. We're here too. I don't know if it's entertaining, but you know it's here as as just information. Okay, you don't have to follow our advice. It's just as a hmm let me see what they have to say about
it type vibe. Okay, So don't sue me for sure, Chris, do you want them to like.
I would appreciate it if they didn't.
They give them your address?
Okay, no, no, no, no, no, no, okay.
Sons don't. Just just to be clear, don't sue Chris either. Okay, he doesn't got it like that. Okay.
Please.
A man's moving to San Francisco, he's got a new saying he can't he can't be dealing with legal paperwork.
Okay, I got expenses.
Come on, So we're just here for fundies, not your financial advisors. You got to get your own financial advice, your own financial planner, your ow investment advisor, all those good things. But we are here to take some of our listener questions and we love to do it. So as a reminder, y'all can submit your questions. You can send us a DM on ig at Brand Ambisson Podcast or you can email us Brand Ambisson podcast at gmail dot com. So please please please send in your questions.
The mail bag is, you know, looking a little light at the beginning of the year, so let's get some new juicy questions in there, y'all. And to our new listeners who maybe found us from this viral TikTok post, welcome and hello and thanks for actually tuning in. You're in the right place. We're happy to have you. All right, So diving into our first listener question of twenty twenty.
Five, let's go.
All right, Chris, you're ready for our first question?
All right, let's get into it.
I'm shaking my shoulders back, all right, it says, I am thirty seven. I'm gonna be Oh, this is from Nadine and Ig. I am thirty seven. I'm going to be thirty eight next month. I lost my job, so I no longer have health or life insurance through them. I was thinking of getting my own policy outside of my employer, and right now I'm trying to decide between term and whole life insurance. I also want to grow wealth with my policy at some point? Is this realistic?
I don't have kids yet, but I just feel like it's something that adults should have. Also, can you talk a bit about investing through your four to one K versus the IUL, which, thanks to the power of Google I know stands for Index Universal Life Policy to ne get that right?
Yeah, that sounds right to me.
Yes, Hold on, I'm gonna double check real quick. Yeah yeah, okay, Index Universal Life Insurance versus a WROTH. Okay. So there is a lot of like alphabet soup in this question, Chris, So this is important and so we're going to tackle it together. Hold my virtual hands ba FAM. All right, So starting with the initial question, life insurance policy. She's thirty eight, has no kids, considering getting her own life insurance policy. Is that something that she should consider?
You know, whenever I hear people talk about like should they get life insurance, I'm always the first thing comes to my mind is like you should be thinking for who like, who is this for? Because you will no longer be here on this earth, so you're not going to get to enjoy the money. So is there somebody in particular who would need your income that's going to
be lost now? And that's basically what you're replacing, right because if you have a spouse who you're obviously you're part of that, you know, financial contributions to the home, if you have kids who have expenses that are going to keep going on then Yet, but oftentimes made for single people, there's not really a reason to have life insurance unless you have unless you can come up with a very valid reason, like you want to leave some
large chunk of money to a foundation or something like that. I don't know, but yeah, you're just existing and by yourself, you're perfectly fine. To me. You can just gift and give the money that you accumulate. So you should be like, as you're planning for retirement, you're saying for emergencies, you have something set aside and you can give that away as a gift without having to take on the expense
of like a term or whole life insurance policy. So for me, in this situation, if you're single, thirty seven, thirty eight. No kids, No spouse's going to rely on your income, no family member that you're supporting, and they're going to be in a tough spot when you're gone. It's no one who's depending on your income.
Then no one needs you.
They may need your friendship. You know, you do you have life insurance?
You're you're no technically single and no kids?
No, not anymore. I did when I was working and I was married, I had a life insurance policy. But after that, I'm like, who is this for. I'm like, if once I events, I vacate this earth, whatever money I've saved for retirement, I'm going to just give that to my family and my niece. You can help pay for college or help out you know, anyone else in my life. But I'm at this point I don't need a life insurance policy. If all was of a sudden, I.
Put me down for that fancy microphone, I would like that, just you know, think a little posted on it.
It's gonna be, it's gonna be. I have i'mna have a little uh insult counter in my will and then want people to go back and review these records.
Put them on the tombstone.
Yes, you definitely give you do this.
His beard connects and nothing else.
I like that. That's the best. That's like the best thing you can say about me is like your beard connects every time. Just think it's such a.
Fun sentence to say, like your beard connects. I don't know, and it just matters in some way that I don't understand. I just think it's funny, does it really? There's nothing to connect it too, because it's.
You know what, there it's one more wait, you wasted one of your insults on this point. It was pointless. You already wasted it now, but it.
Feels so good. It's like a medicine for me. Okay, So anyway back to Nadine's question, if we could, this is a very serious podcast, Chris, okay, So we're talking about life insurance. So now term versus whole, you know, simply put, term is like, so I have a term policy. I think it's twenty or twenty five years, which is basically my prime working years. So something happens to me for the next twenty twenty five years, I know my
family is going to be Okay. It kind of sucks to have to pay anything into that pool, and it's not cheap because I'm black and at the time I had just given birth, I had just gotten on like an antidepressant. Oh, some policies won't even like cover you if you have that kind of thing on your record. So anyway, my monthly payment is like one hundred and fifty bucks. It ain't cheap. And so the next question, so there is this sense that some life insurance policies
are more of like an investment vehicle. So now Nadine's asking about, like, do you can you talk about using a four to one K versus the index Universal Life policy versus a WROTH four one K or roth IRA. Maybe I feel like for BA FAM, the first thing maybe confusing to them is like what even is an IUL insurance plan? Can you make it simple for us?
Yeah, I'm going to try to use this few words as possible to descrive this. But indexed Universal Life think of it as a version, like a variation of a whole life insurance policy. So whole life is meant to be you just can keep paying those premiums for the entirety of your life, and then at whatever point you die, that benefit would go to whoever you designate, whereas like with term right, once that period of time is up,
the policy goes away like there doesn't exist anymore. So if you were to pass away after the term is up, then no one would get any money.
Right.
There was just more like a security for you if something were to happen when people needed you during that time. So the Index Universal Life it kind of takes it a step further. So with the whole life policy, typically it's just very simple. You're just giving your premiums and then they gave you this benefit whenever you need it. With the Index Universal Life it lets you kind of invest some of the value that can kind of grow
in these policies. Right, you have like a death benefit, which is the money that like if you get a million dollar policy, that's the death benefit. But you can if you put as you put more money into the policy develop I kind of almost like excess cash that kind of over it being invested over time, it has that extra value to it. So they allow you to take that money and then kind of almost like a four to one k like choose some options to throw that that money into, and so it gets marketed as
this is a great wealth tool. It's a great way to invest, and because you're building up this money and you need to avoid taxes, all these things. But the thing they oft sometimes don't tell you about is one whole life policies are much more expensive than term life policies. They can be you know, up to like ten times more per month for the same amount of money the same amount of coverage. So you're already giving way more money up front into.
Bucks a month for life insurance. Like do you need life insurance?
Like you needed that bad?
You got the money in the bank for the family. I don't know.
I'm just saying it might be okay if you get four a ton of money every month in these premiums. And then on top of that, they oftentimes will cap. They do cap your losses, which is one of the selling points, like, oh, look, we can make sure you don't lose too much money. Because you put your money into the stock market, if it goes down a lot, you have this big downside. But with us, we can protect you on the downside. But the only reason they can do that is because they also cap how much
you can earn. So even if the stock market makes twenty percent, you may not be getting all that they're going to keep the difference. They may say, we're going to cap you at nine percent and they get to keep the eleven percent that it earns over that. So there are all these things in place that they're like, even think about an insurance company, they're going to make sure they come out on top, right, They're not in
the business of losing money. So it sounds like a great deal, but oftentimes there's these fees if you try to get out early. There's the fact that you can only earn so much in these policies. It cost you a lot every month that oftentimes don't make the math makes sense anymore. You would have been better off just putting it in your four one K or your IRA.
Yeah, I mean with the traditional four to one K you get the pre tax benefit, so you're putting in funds before taxes have been taken out. Yeah, that's so interesting. It just sounds like one of those products that people with a lot of money get talked into investing in because they have a fancy financial advisor who gets made who gets mad kickbacks, and they're not so worried about little fees, like they're just kind of like letting an advisor kind of take their money and do things with it.
And I think for like the average person, it doesn't sound like the kind of tool that makes sense long term for investing.
To me, the red flag, oh well go a sorry.
Yeah, just based on what I've read and what you've said so far, I'm not a fan.
And to me, the red flag is you see a lot of people, even on not TikTok all for social media, I see a lot of people who are like salespeople for these insurance policies where ITA's whole life. Sometime they call it infinite bankings and they call it index like they have all these names infinite banking.
Yeah, they have all those targeted to like dudes like, oh.
You know what it is, don't You would have banked that just gives you infinite money. It's crazy, but you think about it, Why are these people why are they putting so much energy into selling these products to try to get you to get it because they make a lot of commission on it. You don't see those people doing that for term life insurance. You don't see a bunch of videos like oh here's how I can make you money with term left because there's not an incentive
for them to do it. So to me, that's the red flag. If a bunch of people I don't know where want to just sell me this, there's in it for them. They're not doing this out of the kindness of their heart, and.
They're doing it because they don't think you're going to kick the bucket anytime soon. Exactly, really underwright so that they can pick people who probably will be alive and never need the money. That's the truth of it. It's such a gross, kind of morbid, but fascinating industry. Necessary.
I believe in.
Insurance for sure, Oh yeah, for sure, But it's just interesting the life insurance policy and the underwriting process and how, yeah, how they completely can predict down I've heard this guy. He was on a podcast I was listening to. I don't know his name, doesn't really matter, but he worked for in the insurance underwriting business for a very long time,
and he's like, oh, we know we can. We have these like really scary calculations that if you saw you'd be like, oh shit, I'm want to die when because they figure that out? Okay, but so Chris, you're you're an entrepreneur, you worked until when did you officially go one hundred percent and this whole popcin.
Popcorn thing twenty twenty one.
Sorry, but the popcam I don't know where that came from.
Twenty one. We're so happy you know so much about me.
Yeah, yeah, yeah, okay, So how are you investing now as an entrepreneur?
Oh? So I still go through uh IRA. That That's what I've been using. So I have obviously had all my retirement from when I was working my day job, but I still use an IRA. I haven't graduated over to doing like a opening up a four one K through my business. That's like I'm thinking about that down the line, solo four one K. I have one of those, but for now, like IRA still works perfectly fine.
Well, but isn't there a limit on the how much you can control or that's just the roth IRA.
Well there is, so you do have. I do have the same contribution limit when I do like I'm doing a typical iry like everyone else would would do. I'm not doing like the like a sep ira, which is like for self employed people where you have higher cap on that to what you can do. And that's because I'd already thankfully have done a pretty good job of investing before I left my job that I'm like, Okay, I don't need to max out as high as I was doing before, so at least for now, I may
change my mind. I'm like, you know what, I want to accelerate it. But with the current limits, I'm like, oh, I'm still good based off of what my plans were.
Like seven thousand for the year.
Yeah, this is last year, seven thousand. I think it's still the same issue. I didn'tcheck the twenty twenty five limits yet.
Ohkay, gotcha, Yeah, I need to. I kind of forget. It's usually something my CPA or my advisor is like, hey, and max out your wroth iray, and I'm like, oh, sometimes it doesn't feel like saving money. It just feels like but I wanted that exactly.
It's like I can doing something with this man.
Thirty something me, twenty four year old me would be just be appalled by some of the basic like personal finance failures I have been making lately, just because she's like she would be like, Mandy, come on, like what about our seven savings accounts? What about lifestyle inflation and keeping that away?
You know, life happens, though it's easy to get get pulled into life and they say, you.
Know, yes, it truly does. But I do need to start thinking more about like future me and how I want to create like a certain lifestyle for myself so I can be there for my kids and to like be a certain kind of just really have my golden years sooner than I would otherwise. And I got to tap more into that future future me future.
I mean, I think I think having a couple of kids kind of really does make you have other things you're thinking about.
I think you have nothing for everything though home, Like I'm telling you therapy, I think you know it's I gotta take some responsibility. Okay, Well, thank you Nadine for your question and for and for Chris for almost making that makes sense for me, Like I kind of get it, and I hope you do too, pa fam. But it's also a good reminder. I'm sorry.
I think that wasn't so mean. I think you were on pace to lose the ability to get this microphone like by the end of this recording, like.
I'm gonna need that, Mike.
Thank you.
Yeah, so thank you to Nadine for your question. We're gonna move on, be right back we have another juicy question for y'all. Be right back. Okay, be a fan. I'm back with Chris Browning a popcorn finance and we have our second question twenty twenty five from a listener, Christa, who sent us an email and she says, Hey, brown Ambition, I hope you are well. I have a question about my job. I started a new hourly position in January.
After a few months, I was given the opportunity to start an internship or role sharing in a new field within the company. I have been excelling at this position and everyone has been complimentary, including my boss and the CEO. Now that the internship has ended, I have been and I've been given an offer. To my surprise, I only received a title change, no raise, no transition to salaried employee. I'm frustrated that I've gotten no pay bump even though
my workload has more than doubled. I've decided that I should accept the junior position and wait for a year, other than go back to the position that I was originally hired for. I tried negotiating for PTO and more flexible schedule to no avail. I want to grow in this new position, but it feels that the company is getting a steep discount for my work. Also, the workload is a lot. To be honest, the original position I had was less demanding, and I would just be focused
on one department. I feel like I'm going to get if I'm going to get paid the same, why not just stick to the less busy the less busy title. It can be frustrating seeing others do a lot less work for the same pay. Which would you choose?
Oh, this is a tough question. I'm really curious to hear your response is because me and being a people pleaser, I'm like, well, I can't. I had to take the job, right, I had to take the tible because they offered it to me. What if I say no, are they're going to risk? I know it's wrong. That's why that's why I come to you. I come to Mandy with these type of questions.
Confused by that response. I don't understand it. Hell no, so girl, it's funny because so I'm writing this book right now, right And one of the beautiful things about this process is that I'm an email hoarder, and I save an email from people, and I went back over ten years ago and I found this email from a mentor of mine. His name was Ray Matoyer and he's he was a brilliant journalist. I say it was because
he unfortunately passed away last year. He had cancer. And Ray was, you know, he was young, he's probably in like his sixties, but he took the time to send baby Mandy an email. And I was in a similar position as Christa here, and I was a I was a reporter at Business Insider and my editor had just
been let go because she went mongering. And I am, I guess a snake, And I was like me, may me gim me anyway, I went for her job and they said yes, and then they gave me a very small pay bump even though I was doing who I was moving from a reporter to editor and all this stuff. And I remember at the time, Ray was like, yes, say thank you and accept what you've been given and then go out and find another job and go out and get a competing offer. And that's really the only
thing I can say to you. Krista is like, yep, well, they are telling you what they want to give you and it's not and they're telling you like it's not fair. You can see that, you can see that they don't really value the additional work that you're doing. They are trying to get you at a cheap price and they think they got you, and right now they do because you don't have a competing offer to use as leverage.
Now you could definitely argue them, like, I think the financial morals of the situation is like, hey, your people, you know, commenceate with like their skills and the value you're getting from them. That's shady on their part, but it's also the it's the reality that you're in. So I think I would make it my job Krista to
take these and you've done. I think we're smart to get the opportunity to intern in this different, you know, department and get all these great skills, take that great skill, take those great skills and leverage them for another opportunity at a different company that will pay you what you're worth.
And at the end of the day, that is unfortunately one of the challenges of being loyal to an employer come, especially when you're coming an entry level or you're coming in like at a part time or hourly worker status, is that sometimes companies will purposefully recruit, you know, younger, more inexperienced people and try to like nurture that talent and keep them loyal because they will spend less money over time on those employees because you're kind of starting
out at the very bottom and they only have to give you so much of a raise to make you feel like you're making progress, where the reality is that if you go out into the open market, open job market, and put yourself up, you know, for different jobs, you may find that they are more willing to pay you a premium because as they know, they have to. One they have to attract you from another company, so they
have to kind of beat what you're already earning. And secondly that you're out there and they don't consider you someone who has been with the company for five years and started low, like they're just going to pay you your market value where they should pay you your market value at the time. So I'm always like, I think about that email from Ray, and I'm grateful to him for giving me that advice, because I really do think it kicked off my whole you know, my lack of
I was gonna say my lack of loyalty. It makes it sound so shady, but just my my understanding of how it works and how it's not like you're It's not that you're not people pleasing, it's like, but who are the people you want to please? And trying to please companies to save them money is just not in alignment.
That's a good phrase. It's not in alignment with like what I want, what I wanted for my finances and my career, and it doesn't have to be all it's okay, so go get you another job, Krista and Chris, Wait, is this really you? Christ and Chris?
I was like, let me change it just a little bit. I was in the exact same bank. When I say people pleasing, I meant like I would take the job because I'm like, if I say no, they're going to treat me. You know, well, yeah, I mean.
She has you could take the job like you gotta get paid.
Okay, yeah, because I was in a very similar position. I was. I was working running a payer, having run a pay roll department, and the person above me they retired and I just took I had took on all the roles in the meantime right I was doing I was basically doing the job, and I was doing the job of two people because it was me and her and now it was just me. And then when they finally got around offered me the job, they downgraded it
was like a senior position. They took the senior away, and I like, well, you just don't have as much experience. I was like, but I've been doing the job this whole time, Like, oh, you know, HR just couldn't allow it, you know, without your experience. And I'm like okay. So I took the job, and then I went and got another job, and I was already I was so fed up with this jo. I hated this place. I hated working here. So when I get the job, I get I going to tell my boss, Hey, I'm putting in
my two weeks. He's like, well, is there anything we can do to keep you. I'm like, well you want to give that chance? Right? Yeah, no, I'm leaving. I'm pretty much.
God yeah, no, one hundred percent. Okay. That that definitely makes that definitely makes sense. I mean some like the reality sometimes is like we gotta make money, so yeah, take the job. I mean, in her case, the question between like should you go back to being an hourly worker versus take the more demanding job even though they both are paying the same I lean toward take the more challenging role because of the experience you're going to get and how you can leverage that for a new
role elsewhere. But you could also argue, I guess that take the hourly job and then spend more time on the job search, spend more time you know, maybe getting like contract or clients or something like that. But I can I can see it both ways, but I definitely lean toward more take the more demanding role. But just remind yourself and like that you're going to be getting out there and you're going to be using this experience not for them, but for yourself to get a better, better opportunity.
Oh, you know, part part of the question was like way I think they mentioned, wait a year. Is that is that necessary from your perspective, like you have to put in that much time to make it worthwhile.
To No, I don't think so at all. But that is like a very common thing that we tell ourselves, like six months seems like a good as a year. Two years seems like a good amount of time to pay our dues before we can, you know, have that much experience. That was another thing that Ray had said in my email. He was like, because I think I had a year and nine months and he's like, you're about to have two years of experience. And I love that, like subtle rounding up, you know, like there's like a
way to market that. And no, I really don't think even on job descriptions. I have personally written job descriptions for roles that I have hired, and some of it's
just kind of arbitrary. Yeah, three years sounds fine, but if you're two years and four months, but you have what I need, like I'm not going to be doing the math, you know, like I think it's yeah, I think instead of saying like one year or two years, just say until I feel confident enough in this new skill set or I feel like I've learned wrinny, excuse me what I need to learn. But sometimes opportunities present themselves before you feel ready and you just take and
you learn as you go. And that's okay too.
I always come to mand to get my little confidence boosts. She's like, just do it, you can do this.
I was kind of like looking at you while I answer that, but you didn't ask me, but that, you know, I was imagining you in a wig for being.
Christa still with the connecting beer though, right as we get to.
Keep that, there would be something for it to grab onto, you know, something to connect to all right, be a fam, Chris, thanks for joining me for b a qa ba Fam. Don't forget to sign up for the five Day Career Reboot Challenge. You go to Mandy money dot com slash reboot to sign up. We're kicking off soon. If you're listening to this podcast the day it airs, we're kicking off I think like five days, so check us out January fifteenth. I'm so excited. We'll see you guys there. Thank you, bi fam. Bye