Episode three eighty four is episode two thirteen, how to Save your first one hundred thousand dollars.
Welcome to the Frugal Friends podcast, where you'll learn to save money, embrace simplicity, and liver with your life. Here your host Jen and Jill.
Welcome to the Frugal Friends podcast. My name is Jen, my name is Jill, and today we are continuing in the theme of our six week roth Ira Challenge with how to save your first one hundred thousand dollars.
Mm and it sounds like a lofty goal, but we're here with you. There's steps along the way, and I think having that tangible goal, the why is this the amount that we are aiming at is going to get explained in this episode.
Yeah.
At the end of our six week roth Ira Challenge episode which if you haven't listened to that you should go back and listen, I ended the episode with a challenge to not think about becoming a millionaire. Sometimes we can think I don't need to become a millionaire. I'm
perfectly happy working. I'm perfectly happy living on you know, not a lot, or working till I die, which is what Jill said, but I probably will, honestly, everyone should pursue becoming a millionaire, not for the sake of having a million dollars, not for the sake of saying you're a millionaire, not for vanity. But when good people hold wealth, good things happen. Wealth is going to be there, The money is going to be there, and the question is
who's going to hold it? All right? Are you going to let your employer hold it because you're not asking for a rays, are you going to let target hold it because you're not controlling your impulse spending, or are you going to control it by pursuing the raises, controlling your spending, and putting your money into your investment accounts.
It's also letting the math math. One million dollars sounds like a lot, but when it's for the purpose of retirement, you're living off of that money for X number of years, and it's a helpful metric to aim at that for most people, that amount of money will be sufficient or in the ballpark of sufficient to live off of in retirement so that you can be work optional if your
circumstances demand it, or it's what you desire. So that's the reason for kind of all these aims to be a good person holding wealth and to just be able to provide for yourself too. So wherever you fall on the spectrum of the whys behind it, I think we can find ourselves having this as a beneficial aim. But just starting with one hundred K can really set us on the right trajectory to finding ourselves in an excellent place come retirement.
Yeah, it is definitely the place where we want you to start. Because one million, yes, overwhelming, but when you think about compound interest, theoretically your money doubles every ten years. I said this at the episode to at the end of that episode too, right, So if you're looking to get to a million dollars, all you have to do is start thinking about the first one hundred and twenty five thousand. I know that's a little more than one hundred K, which is what this episode talks about, But
think about it. When you have one hundred and twenty five thousand dollars invested, if you don't touch your accounts ever again, in ten years, that's going to double to two fifty. In ten more years, that's going to double to five hundred and then in ten more years. So after thirty total years of you not looking your your investment accounts. That could good double again to one million dollars.
So it's a rule of thumb. It's not a hard rule, but after playing with the numbers and some calculators, it's, you know, close enough to where if you just think about getting to that first one hundred and twenty five thousand, that's that's the main hurdle go, that's the big thing. And so that's what this episode is trying to get you past that barrier.
Jen loves her some compound interest. Her mind gets blown, but she still talks about it.
Don't understand it.
But first, this episode is brought to you by something special. It's what you are and it's what we all love. And right now we've got a little something special going on for our friend Letter subscribers. We're doing a one thousand dollars debt payoff giveaway. We've already been talking about it all month long in the friend Letter. Sorry for those of you, sorry not sorry for those of you
who don't have the friend Letter. And this giveaway is for our friend Letters scribers only, but we do want to let all you listeners in on the tee as well, So if you could use an extra one thousand dollars to pay down debt, or get one step closer to any other financial goals one step closer to that one hundred thousand dollars mark. Then get the newsletter at Frugal friendspodcast dot com. So you've got three more days to register to sign up for the newsletter before we announce
the winner. So the timeline is shortening, but it's not too late. So if you want to be notified as well when we do more things like this. We've been doing a couple of giveaways over the past year. They've gone really really well. Real people are getting money and helping towards whatever it is that they want to put that money towards. Then stay subscribed to the friend letter so Frugal friendspodcast dot com and you can sign up and you could possibly get a thousand bucks.
Yes, yeah, the last one goes out tomorrow before the giveaway ends, So today is your last day to say sign up for the friend letter and get the link to sign up for that giveaway. And we we are running this giveaway, so we're not like selling these email addresses or sending you spam. This isn't like a third party thing. This is our thing with our personal finance friends, and we just want to help some of our collective community pay our debtor or whatever financial goal you have
this year. If this goes well, we could do more of them. So this is just a test for us, and somebody benefits.
By winning one thousand dollars.
So all right, So before we get into this one, we have had some other episodes play that are really great since releasing this one. Episode three sixty two the Multiple Forms of Capital to Earn and Build Wealth, that was another rerun with Laura ol Daney, and this one is really really great. That one will be helpful for you if maybe you do feel a little behind on your savings but you want to build wealth and maybe you prioritize Main Street over Wall Street. That's a really
good one. And then episode three oh five Intentional Strategies to increase your income with Rich Jones. That's going to be a really good one if you've been going to work and you haven't been pursuing promotions, raises, looking for jobs that pay more. Again, somebody is getting the money, right, it's either your employer who is withholding it from you, you know, because you haven't pursued it. Or it's you because you are doing the things to increase your income.
And so episode three oh five is a really good one to listen to if if that one is for you.
That's a standout interview. But let's do this one again.
What we're going to be talking about today is a little bit different from what we talk about one sixty five that both are kind of essential. And then episode two oh four how to transition from spender to saver because that's a skill you're going to need if you want to save one hundred thousand dollars. But now, now, Heine, let's let's get into our articles for the week. This first one is from four Pillar Freedom and it's called the Math that explains why net Worth goes crazy after the.
First one hundred k.
So we wanted to put it first out why it's so hard, why it's so important, and some of the math that goes behind it.
What'd you think of this one, Jill?
So I have a confession to make to you, Jen, and I'm going to do it publicly on this podcast that this article opened my eyes to We were talking a while back about our membership that we have that we get to enjoy just more relationship more community over in that membership, and you were expressing a goal at one point that you want to help women get to their first one hundred thousand dollars in savings, and I was so on board. I'm like, how beautiful, Jen, this
is amazing. You know, that sounds so cool helping women get to one hundred k in savings or net worth. Awesome, let's do it. But to me, it kind of felt like just a cool, arbitrary number, like, sure, we found we were aiming at six figures. That sounds like something people might want to do. Let's go for it. I support you, and I don't think it was until I read this article that there's actual math and reasoning behind
that six figure number. And I really like how this particular article explains that in the beginning that they notice this trend of people who saved their first one hundred thousand dollars. Now they're talking about savings and investments, but how they didn't really see exponential growth in that or huge dent in their savings until they got to that
six figure mark. So saving up until that point is still valuable and worthwhile, but we're not really going to see the benefit of compound interest until that one hundred thousand mark, until we see the scales start to turn. So it's not just an arbitrary number. There's a reason to aim at that number in order to see a noticeable impact in the wealth building and what our future can look like, and what a remarkable aim to put our frugal skill set to to be able to notice
something profound for our future. And it doesn't even have to be that distant of a future if we can start aiming at this now. So that's my confession and my reaction to this article that it really helps something click for me of oh, this is why, this is why it's a decent aim it's at that point that we really see a big shift in our ability to make more money.
I don't always do a good job of explaining why I think things are important. I just am really good at telling you things are important. But yeah, so it's not just an arbitrary number. But part of it is, like you do get a mindset shift because we are used to seeing numbers in like five digits, like annual salaries or like bonuses. That's kind of like five digits
are kind of the max for most people. We are not conditioned to see six figure numbers, and so the first time you see a six figure number, not only does the math click, but your reality shifts as well, because it's a number that people don't get to until maybe later in life, until they don't have all of
the time for compound interest to build. So if we can make that shift earlier with our money and our mindset and get used to six figure numbers, then the change doesn't just compound in the accounts, but it can change in our minds as well, and that's that's a big reason why that six figure number is so important, But it is also the hardest to get because of
the math. And if you're in our membership, you'll see in the Personal Finance Simplified course that we have in there, we actually have a lesson about compound interest and investing, and you can see that it's what James clear refers to as like the plateau of latent potential. And you think that your growth is going to be this linear path, it's just going to go like straight up, but what we see is that really it's if you zoom out, the first ten, fifteen, twenty years is pretty pretty flat.
You're going up a little bit, a little bit, a little bit, and then once you hit that ten fifteen year mark, you still to make like crazy growth. And once you hit the twenty year mark, it doesn't even go like you know, east west anymore.
It's just going straight north. Like that. That line looks like it's going straight up.
It's a slide. You don't want to go down.
Right, Yeah, so it is, but you have to get through that first ten to fifteen years where the progress looks pretty flat. And that's where this one hundred thousand mark is. And we have a graph where it shows you on the path to a million, what that first hundred thousand looks like, and it's the shift is kind of crazy.
For anyone who has a mortgage, it's a similar concept. Those first few years it's primarily interest, and then the last years it's primarily principal. And yeah, that's not quite the way that we want to work towards wealth, but it's that kind of concept where there's a lot of heavy lifting at the front and then you just see amazing results towards the end, but even better with saving and investing than with paying down interest on your house. But with the way that they break down the math.
I think it was helpful for me to digest and felt attainable, and I also liked how they gave a realistic expectation for how long this would take. So they give a basic example of someone investing ten thousand dollars annually with an interest rate of seven percent. Obviously, you're not always guaranteed that. This is just the numbers that they're working. With interest rate of seven percent, it would take a little over seven years for you to reach
that one hundred thousand dollars mark. But I would say investing saving ten thousand dollars a year is relatively attainable for the average person. Your average salary could potentially do this. Maybe you'd have to add in a side hustle, maybe it would take you a few years to get to that point, and that's fine too, But it also felt pretty typical, pretty average, if you were going, you know, decently hard at saving that amount of money, which, again
I like attainable. I like what can be sought after for the typical average person. You know, if the average household is earning collectively sixty thousand dollars, then this is possible. Obviously, there are people who that's not the case, and it will take longer, but recognize, you know, seven years isn't short. So even if it's ten years, fifteen years, it's still worth aiming at because, like we're describing here, you're going
to see exponential growth once you hit that mark. Ten fifteen years might feel like a long time, but let's still get after it because once you reach that ten fifteen years, the amount of time that it takes to reach the next one hundred thousand dollars is going to be even shorter than that. So that was helpful for me that bite size understanding of oh, here's how I can break it down into smaller goals.
Yeah, and we don't want to minimize ten thousand dollars a year for somebody who's never invested before, that's a lot. You don't have to start there. It's totally okay.
I'm not doing it yet. I'll clarify I'm not doing it yet. It just felt like, oh, okay, in one year, it's less than one thousand dollars a month.
Yeah, so you can start with ten dollars a month and work your way up. I think ten years to get to one hundred thousand dollars is a totally reasonable goal. And typically when you set your eyes on something that's ten years away, you end up doing it in a fraction of the time as well. So if you set a ten year goal, you're likely going to reach it in that seven point eight four that we're that we're seeing here, or even less. You just have to start
working towards it. But yeah, so seven point eight four is what they are, and I love the I use the seven percent when I calculate retirement savings too, because a diversified portfolio will usually return that. So seven point eight four and then your next one hundred k. This is the hypothetical Shannon. Shannon is our hypothetical friend who
invests ten thousand dollars a year. If Shannon changes nothing and keeps investing for the next ten years or for the next like however many, she reaches her second one hundred thousand dollars in five point one years. And so how does that happen? It's because of compound interest. Every time your money can build on other money, it's going to grow faster, and so that's why it always takes. When you're starting at zero, you have nothing to compound.
That's why the first hundred k is going to take the longest, and then it's going to get shorter every hundred k from there. So we get five just over five years to double the money essentially, and then for the next we go down to three point seven eight years, then we go down to three years, and then we go down to one hundred thousand dollars in two and a half years.
So that's over.
Our hypothetical friend Shannon has gone from zero to half a million dollars in twenty two years. But that path, and you can even see right on this graph, it has not been linear. The first seven point eight four of that year's was the flattest, and then we get a little bit more curve up for the next hundred k and a little bit more curve up, and then once we get to a million, that graph.
Just starts shooting up.
But I thought it was really even like for somebody that has saved it, to see those time blocks get shorter and shorter on this graph is super eye opening and encouraging, especially when I feel like my saving is kind of arbitrary at this point.
Yeah, I also really enjoyed the graph that showed what growth on our savings and investing would look like at different interest rates, because I think that's always the hole that we want to poke in this of oh, well, you're not going to get twelve percent interest, you're not gonna get ten percent interests, You're gonna be seven percent interest. So it's helpful to see what the growth looks like.
Obviously it's less growth if it's a three percent interest, but it's helpful for my brain to see that chart.
Yeah.
I also liked that graph because sometimes people will use six, sometimes people will use eight, so you can see depending. I mean, the interest rate is arbitrary because you can't control it, but you can kind of see the difference.
Or actually I would say, like the not big difference like how fast you're going to save, But I it's less important to focus on the rate of return and more important to focus on the rate of saving, which is kind of where we get into going through in these like these next charts.
Let's see yeah.
And then the author just says, like the math works at every level. So yeah, and the magic of compound interest doesn't tend to reveal itself until you cross the one hundred thousand net worth mark, but then you get to see it at every level beyond there.
So let's talk about how to do this. What are some of the key components If we were to say this is a great aim I want to do this, how do we do it? And so Investipedia has a really great article breaking some of that down that we're going to go through. Jen would you think So?
I liked this article because it was a little different than all the other ones, Like, yes, you're gonna get lower your expenses and increase your income.
Duh.
Every article is going to say that, but there's a few unique perspectives that I think you don't really hear about or think about unless you're like entrenched in the personal finance world.
So I really wanted to like go through all of these two.
To make sure that you know that it's not just about lower your expenses and increasing your income. Obviously those are the two biggest things, but there is more to it. So the first one here is the right mindset. This was actually the first one on most of the articles, which just brings like back home the point that your mindset is not just like a woo woo thing that
you don't have to think about. It is something that directly impacts your ability to do the concrete actions, and so for most people, saving, like what I said in the beginning, saving your first one hundred thousand dollars is difficult because we don't think in six figure numbers. We don't think that we are capable of those numbers because we have not reached them ourselves. We do not have people close to us that have reached them, or people in our outer network that have six figure savings, at
least that we know of. I would argue that there are probably people with six figure savings that just don't talk about it because they think it seems like they're being better than other people, and so they think. That's another reason why we need to expand the personal finance conversation, because if you have one hundred thousand dollars saved, you should feel more free talking about that in a way that lifts other people up and doesn't lift yourself up.
And they're for sure are.
Ways to do that, but yeah, we need to have the right mindset and believe that a six figure or seven figure net worth is not only attainable, but it is simple to achieve and it is necessary to achieve. Honestly, one hundred thousand dollars is not going to get you anywhere in retirement.
So it is like.
Minimal requirement to get to six figures, and it's just the earlier you get there, the better off you are down the road.
Similar to debt payoff, saving your first one hundred thousand dollars is not going to happen accidentally. So we certainly have to have a mindset that corresponds with an ability to do this and the why behind it, why we're doing it, that's going to keep us sustained because at best it's going to take over set like a little over seven years, and for those of us who live on a little bit lower incomes, it's going to take even longer than that. So that's a marathon, that's not
a sprint. It's gonna take a while. So we're gonna have to have a good framework in our in our thought life and how we're gonna get after this goal. Of course, the next thing, like we said, it's gonna be on all of these articles, but it's worth the reminder that we're gonna need to keep costs low. Again, this is gonna be in a sustainable way. This cannot
just be rice and beans forever. And always because again we're talking seven to fifteen years that this could take us to get to this point, usually after we've paid off debt, unless you're combining debt payoff with savings and investing. This is this is long term, So keeping costs low but in a way that's going to work for you long term. Some of this could mean looking at, of course,
your variable expenses, your food. It's a big expense every month, and so certainly make it the smaller shifts like dinner at home, not eating out as much. I know it sounds relatively minimal, but over the over a year, over two years, ten years, that is going to add up to thousands of dollars of money savings that if we've got that mindset to support it can go towards that
savings and investing. Yeah, looking at transportation costs, housing costs, so of course you want to look at the big expenses and the little expenses and trying to keep it as low as possible.
I was just thinking, so we say it's a marathon to get to one hundred thousand dollars, but you can run a marathon in a day like you can run it in a day. A marathon and when you're trained, like if you're a regular runner. Even I don't run marathons, but I'm a regular runner, Like I could run a marathon in a month or two, like a twenty six point two miles, I could do that in like two months easily. Like this is like a marathon is nothing
compared to this? So like about that when you're using the terminology like it's it's not a sprint, it's not a marathon, it's like a lifelong like this.
Is a haul, like I don't even know.
Yeah, yeah, this is for Tria, Like get the magnitude of it, Like this isn't I know like fire bloggers and like all these other people will make it seem like it's easy to save money. It's it is a life like journey mission.
I think it's a mission. I think that's the word I'm gonna go with.
But yeah, so a mission, yes, yeah, So like.
These changes that you make in your lifestyle to reduce your expenses, is that is significant because you're not This isn't just a I'm gonna eat rice and beans for six months and sprint to see you challenge myself to see how much debt I can pay off I love I love that idea, but this is longer, and you need to develop a system of values based spending and understand yourself and what you want because that's the only way that you're going to make this, say, this type
of saving sustainable. So yes, we love these tips. We've got over two hundred of them in our Modern Frugal Living ebook that I'm sure a lot of you've seen. Those are just the start, Like those are the foundation really identifying your values and creating a values based spending system. That's the goal, Like, that's the goal, that's the tool to get here. So I think, I think that's like an important perspective that I like literally just came realized
on the spot. The second one I really appreciated the way this one was worded. The second one is to reduce your interest burden. I appreciate this line so much because typically you would see pay off your debt, But this is like a mindset shift of why are we.
Paying off our debt? What's the point?
Like, yeah, we hear, yeah, I shouldn't have any debt, let me pay it off. It's evil, it's not. But the reason we pay off our debt is because it is charging us interest. It is costing us to have that money. If it was not costing us to borrow that money, no one would pay.
Off their debt.
Nobody's paid off their student loans in the last two years, their federal student loans. Like nobody has done that. Well, I'm sure, I'm so sorry if you have, I don't want to exclude you, but like most people haven't, if it's not costing you, you won't pay it off. And so the real thing that we're doing by paying off debt is reducing our interest burden. And we want to specifically focus on interest burdens that are higher then the returns that we could get through investing. And so that
is a big distinction to make. Where there are camps where it's like I only want to pay off debt and then I'll invest or. I only want to invest I don't want to pay off debt, or somewhere in the middle. The real point of paying off debt is to reduce your interest burden. And I like the number seven percent when calculating return like long term investment returns for a diversified portfolio, and so really.
Anything I know.
David Bach of the Latte effect, he says anything under anything over five percent. So anything over that five to seven percent, that is a heavy interest burden and should definitely be eliminated. Anything under five percent is kind of like less pants on fire and more like sitting on hot coals sort of thing. So you can if you're thinking about maybe I should have gone with heavy things
versus fire, I can't think of anything right now. But and so yeah, if you're thinking about your burden as being fire, things that are above what you would get in the in your long term investment, is that's pants on fire, get rid of it, and then.
Below is hot coals.
It's definitely diminishing your returns, but it's not like you're not dumb for not getting rid of it.
Like, so, we've got so many images, so much imagery happening here, picturing people hopping around taking their pants off.
I do notwhere in my mind did people take their pants off Jill nowhere.
You said, if your pants are on fire, you want to get out of that.
Don't want to get out of that.
That would be like like consolidating your dead your fiery pants. No, put the fire out, Jill, Gosh, your mindset needs to be shifted. We don't want to take the pill. We want to put the fire out on the pants because we like the pants.
Okay, Well, eventually the pants will need to get changed because move on. The next one is invest in. Okay, and I refuse to use this word just I mean same. It's better than the word cheap, but I'm not using it invest in. I'm going to say efficient vehicles and products. They savvy. Yeah, I don't know what understands what that is, so we're not using it. So invest in efficient smart vehicles and products. So, once you have begun to ramp
up your savings and investing, you've got a plan. You want to make sure that you're putting your money in the smartest possible place. So they list out a few things to be considering. We want vehicles and products that are going to help us save on taxes. Some of these tax sheltered investment options include your traditional four oh one, Hey, your traditional IRA. These are things that help to protect and buffer us from some of that tax burden. They will be helpful vehicles for investing.
Yeah, it's it's helpful. We're not talking about cars, We're talking about investment vehicles and investment products.
This is not cars on fire on fire.
Yeah, so I think what a lot of people miss. We talk a lot about low cost investments. We really love index funds and ETFs because they're very affordable and user friendly investment options. But people don't think about how much their taxes are. Taxes are higher. They are a higher percentage quote unquote fee than any brokerage or managed fund will charge you. So that's kind of the first thing that you want to look at, and you don't get that on the actual investment that's on the account.
So that's why we love the tax advantage retirement accounts, your iras and your employer sponsored so those are best if you are So we had this in our our Q and A with our membership last night, Like, if you have a IRA and you're maxing that out and you want to invest more and you don't have an employer sponsored plan where you go, well, one of your options is if you have your own business, you can actually open your own like solo for one K or something like that. You'd have to see with a W two.
There are several different types of quote unquote employer sponsored plans. You can open yourself if you have like your own side hustle. You just have to see how that conflicts with what your W two employer does and doesn't offer. But if you cannot open some kind of ESP employer sponsored plan, then you go to brokerage account, like a
traditional regular brokerage account as your last resort. But it's going to be you're you're paying taxes on what you've already earned, You're paying capital gains taxes, You're you know, paying taxes later. Like it's not it's still better than a savings account for shore, especially long term, but it is taxed higher than an IRA or a fur one k or comparable. So taxes are important. Pay attention to them.
Also along the lines of investing in the right types of vehicles. The vehicle again not a car that you're driving, but it's what run.
Cars for a second.
Is that's amazing?
I know?
Is the manager risk appropriately? I know we talk about you hear this a lot, like what's your level of risk? And sometime we don't know, But generally it's going to be considering how much time you have, how old are you, how much time do you have until you retire. That's going to dictate some of the risk that you might take. But also how much you know about the investment. Do your own research. Don't just take the information from one person who's doing something that sounds too good to be true.
I know way too many people and I'm not going to say what it was or who it was, but just invested in some very risky because it wasn't even something to be investing in. Didn't know much about it, just knew that someone who sounded kind of smart is doing this thing, and so like I might as well do it too, and lost a lot of money. And that's not just unlucky, that's like we didn't do our research.
So that's what we mean when we say manage rest. Yeah, know what you're investing in, and know how you are and how much time you have yes to be investing.
So I was listening to Scamfluencers the podcast, and they were talking about this Hollywood scam which ended up being a Ponzi scheme, but essentially the guy was taking investments from his friends and then instead of investing it into the actual business he said he had, he was paying
off earlier investors and that's a Ponzi scheme. And they were saying in the podcast that people invested their life savings into this, like everything they had, parents, grandparents, friends, because this person they thought was their friend, this person they knew, they just thought they trusted. And I was
so sad because this. Obviously, investing in businesses is a great way to get a higher return than the stock market, but the people that do that know that they could lose everything, and like venture capital funds effect only twenty percent of their investments to make back a return, they just expect those twenty percent to make back all of the eighty percent of losses.
Like that's how it works.
You have to have money to lose if you're going to get these bigger gains from these like obscure investments. If you ain't got the money to lose, do it in a safe, safe space. And for all that it's worth, the stock market is a safer space than so many other types of investments, especially if you are in a well diversified You have a well diversified portfolio. So that's that's what I learned from scamfluencers this week. But the
next is to maximize employee benefits. And so first we think of the matching on the four oh one K,
which is always something you should get I think. So we have like a chart in our membership in the investing lesson that gives you savings plans for one hundred thousand, like a five, ten, and fifteen year plan, and I think the ten year plan, one of the ten year plans is just it's five eighty five a month, and you could do five hundred in an IRA and eighty five in your employer sponsored plan, and typically that's going to be like they'll match that too, so it's going
to be you'll get to it even faster. But yeah, so take that for sure. But there are other employee benefits that can help you as well, such as discounts at places, they'll help you lower your expenses. Health savings accounts. This is a great thing if you don't have maybe an employer sponsored plan, but you do have a high deductible healthcare plan through your employer that has a health savings account, because this can be used kind of exactly like a four oh one K, but with a a little.
More flexible, much lower limit.
So you can save like pre tax just like a four oh one K, and you can use it throughout your life on any qualified medical expenses. But if you don't and you use it like a four oh one K, then at gosh, I think it's fifty nine and a half. I could be wrong. I think it might be seventy.
I don't know.
Check my math, check my facts. It converts to a regular retirement account. So yeah, that health savings account is a great option if you have access to that and not like a four oh one K or something. But yeah, maximize your employee benefits and whenever you're looking for new jobs to increase your income, compare employee benefits as well.
Like ask to look at their four oh one K plan and look in the investments inside of it, see what the fees are on them, ask about their health savings ca options like these are things that are also going to impress whoever you're interviewing with because it means you know your stuff.
These last two I'm going to combine because I think that they can go hand in hand. And also, you've heard of this, you know this. This is just your friendly reminder to create short term goals and generate additional income. We are going to be far more likely to get at big, lofty goals if we break them down into bite sized, manageable, attainable pieces. That allow us to experience wins along the way, celebrate, see the successes, see that we can do it, build our resilience, have muscle memory.
Break it down into short term savings goals. And when those savings goals, even in the short term, feel a little bit too beyond your reach, generate additional income. I mean, even if they're not beyond your reach, Generate additional income because then you can reach all those short term goals faster. So whether that means talking with your current employer, changing jobs, or starting a side hustle, you name it, it's always going to be a fantastic thing to aim at in
how can I increase my income? We're not saying to push yourself to the point of stress, overwhelmed, fatigue, but are there creative ways to be bringing in more income that's going to help us get out these short term saving schools and the long term saving schools, get us to that one hundred thousand dollars and then just see the growth from there. And we're here for you along the way. And you know what else, we're also here.
For I have a follow up statement.
We're here for my follow up statement, jil Okay, I just wanted to say, like, it's it's no longer an option to only have one stream of income, like the world is volatile, inflation is insane, and it's no longer acceptable for us to have one dream of income. Like I think we all know that at this point, even if we're trying to avoid the fact. Is it okay?
Is it just debatable? Like probably not. But we can sit around and wait for things to change outside of our control, or we can do something about it that's inside of our control now. And if you wait five years, you're gonna wish that you had started five years ago when you heard this. And so I think it's it's important. It's more important than just like, oh, let me get on uber or uber eats and make some quick cash. I think we all need to be focused on how
do I generate additional income long term? And that's all I have to say about that.
So I think a consideration your capacity, I'm going to be I'm holding the tension. I'm holding the tension of those ten sticks on all sides because I know that there are some people who work eighty hours a week, even sixty hours a week, and recognize your life season recognize as your capacity. But certainly I agree, have your sights on this. Whether that means that's not sustainable even
if you stay in that job. So that could mean a change in employment that generates additional income, or it could mean, yes, that we find ways that don't overwhelm or overburden us that could bring in additional income. Just the permission for creativity in this space, that we don't have to stay in one place and think this is just what I have to base my life around. Make what you set your hands to also work for you. You know what, we also make work for us.
Jill, You're never gonna be there. It's never gonna be there. I okay, it's nan.
The bill of the week.
That's right, It's time for the best minute of your entire week.
And baby was born and his name is Williams.
Maybe you've paid off your mortgage, maybe your car died and you're happy to not have to pay that bill anymore. Fuck bills, butffalo bills, Bill Clinton, this is the Bills of the week.
Hello.
So I'm Grace from Maryland, and I first off love the podcast, But my bill up the week is that I was like looking at my budget and everything I was like, okay, well I could cancel my digital only weight Watcher subscription. It's like yeah, they advertise other things in the program as well, like little things you go buy too, So I'm like, how was that really different than my Fitness Pal, which is free.
You know.
I'm like, okay, I just I'll cancel that. I'll switch over to my Fitness Pal. I mean, I'm sure I enjoy the community and weight Watchers, but I'm gonna make do save the money. And then as I'm like going through the cancelation process and everything, it's like, oh, this discounted price thirteen dollars a month, and I'm like no, no, no, no, cancel, can't it's like two free months. I'm like, okay, so
that's my bill of the week. I got two free months of weight Watchers because I was like, nah, I'm going to cancel, so I give them the fake out, although I was actually serious. Anyway, that's my bill of the week. Bute.
That's hilarious. I'm so glad that we could help you get that.
I love the it was serious, but then it turned into a fake out and the benefit that you can receive from that. So that is both a tip for someone who wants to try and reduce expenses to see what is the company going to give you, because they'd rather have your loyalty than lose you. But also I would encourage you once those two free months are up, see what your life is like without it. Are there things that you can implement beyond that that you don't
have to pay for that subscription? Again, when we're talking about getting that some debt payoff or long term savings goals, those are the things that are really going to help us, not keeping those ten dollars thirteen dollars, twenty dollars twenty eight dollars subscriptions, but really honing in on our budget and figuring out free alternatives. We're here for you. We're
celebrating that bill. If you all listening, have a bill, whether it's a fake out or a real out, or your pants are on fire, we want to hear it. Visit Frugal Friends podcast dot com, slash bill, leave us your bill, and now it's time for learning.
You think that's how their pants got on fire, they were hit by lightning.
Possibly, Gosh, they'd have more problems than their pants being on fire. Fided so true.
Well, in this episode of questions that Goldie has given us to get vulnerable with you. I like this one. What is the most challenging part of saving for you?
Chill competing goals. I have so many things that I want to do with my money, and I have made more money. I have generated additional income, which is so amazing to see that it's possible. From twenty eighteen to twenty twenty two, We've really done it. We've done it, and I hope that we keep doing it. But the goals keep increasing, and the part of that could be
lifestyle inflation for sure. But I've got so many things that I want to do and that I want to do right now that it can be tough to get at that one thing of ten thousand dollars a year. I'm not doing that. I'd love to get to the point of doing that, but I also want to cash flow renovations. I also want to not get into further debt. And the reality is is that, well, I want to avoid a scarcity mindset. My resources are not unlimited. I
don't have unlimited money. I'm still like a very typical person. I don't I don't crazy amounts of money. I mean more than I did five years ago, but I still have to be really thoughtful about what am I gonna do with this? So some of that has to do with all, right, can I give myself grace, freedom and permission to take time to even get to that ten thousand dollars of savings idea? But also can I generate
more income? And so some of this cash flowing renovations is what's going to allow us to generate more income through having short term rentals. So there's a I have to keep reminding myself of why am I doing what I'm doing? How is this helping me get to my goal? I can't do it all everything at once. Is this still the best thing to be doing with my time, energy resources? Okay, keep going nice. That's my little self talk.
I will say, you may have gone first, but I wrote down my answer first, and mine is also goals.
So mine is.
Specifically having on crete goals I have. Yeah, I mean competing goals as I think most people's going to be most people's answers, like, there are so many things pulling for our money, and with every increase in income, we have another financial goal to add somehow. But I think for me, I am still a little burnt out from
our debt payoff journey. I know it's been like five years, but those two years were very traumatizing and I have I don't know, and then we just we saved like so fast for our to get to that first hundred K. So I think it hasn't been challenging like stalking away money, because our frugality allows us to naturally spend under what we make. We pay less attention to our budget if we have one, because we know what we make and
what we want and we just save the excess. And so having a concrete goal, though, does help us save more. Like with the buying the new house, that was like a big thing for us, so a big savings goal. So I would say, yeah, having the concrete goal, having the one goal. I think we can sum this lightning round up by saying, like, focus on one goal, which is what we always say, focus on one goal at
a time. And so if you are paying off debt and you still want to get the clock running on your compound interest, you don't have to choose one or the other, but choose one is your primary goal and then just maybe do a little excess here and there at the other and for most people listening, that's usually going to be like, focus on paying off the debt, especially if it is a heavy interest burden, and then get your employer match every month if you have one,
or do one hundred dollars into a roth IRA every month, money that you won't miss that won't make a big difference in your debt payoff, so that you can start to get that ball rolling. But it doesn't feel like these goals are competing.
Yeah, having something on in the background that you're not thinking about the auto payment into that savings, so that your real time energy attention goes to the things that are going to be necessary for whatever the main goal is at the time. All right, man, that lightning round is still true for me. I still have competing goals. That's always my problem. That is not unlimited resources. Yeah, I know that is everybody. Well it's not everybody. There's a few billions.
Okay, everyone listening to our show. We all are goal oriented overachievers who have compete goals, and unfortunately we don't have unlimited resources. I think that's probably if we were supposed to define our listener avatar, that might be her. So if it sounds like you You're in the right place, still.
Struggling with the same thing two years later.
I know, I know it. It is hard to program, like reprogram your brain to work differently. So I am a lot better at really honing it on one goal at a time, but I want to pursue multiple goals at a time always, so, and I think I still, I mean, I still struggle with like defining my concrete goal. Like I have goals, but sometimes it's scary for me to say them out loud because then I have to pursue that. I know, So I think that's that's why I.
Make my goals like super realistic.
I want to save one hundred dollars.
My goal is to eat this chocolate bar by the end of the month.
That is a legitimate goal for you, Jill, because you can take a chocolate bar and literally eat one square.
Yeah.
The rest of us are like, I don't need that goal because I've finished it. I so the guys working on our house brought a chocolate bar in for Kai to be nice. Oh, I ate it that by the end of the day the chocolate bar was gone.
You know what, you needed it more than he did. I did I that's what that says. Well, this episode, We hope it was helpful for you all. I still think back on this one as a helpful marker for me. You know, those different guide posts that you experienced throughout life that helped to define what your aim even should be.
I would say that, yes, I still don't have unlimited resources, but I think in part because of this episode, I've I've got a more refined goal and an idea of where we should be heading and what to build upon, and the tools and resources to utilize to build upon those goals. So while we are still talking about some of the same things and the same things still hold up and ring true, there's growth that's happening along the way too. So hopefully this has been inspirational for you
to also experience some growth. Thanks for being here with us.
Yes, absolutely, I hope it's it's continuing to make saving and investing more accessible to you. And we love, love, love reading your reviews and emails when you say that we have made things more accessible to you. Kind of like Beck two two five three two who says, super fave, I count down the days until each episode is released, not only because of the quality entertainment, but also because I always come away with awesome tips for living more frugally.
It's clear that these ladies have solid values to ground them, which creates a genuine, wholesome listening experience.
Love it, oh Back two two five three two.
I don't know who you're listening to. Jill is not wholesome.
I was gonna say, I'm talking you. I was just gonna say, I don't think I've ever been called wholesum. I love it. I'm basking in that adjective and Jenna is ripping it away from me.
Wow.
Thank things back for your perspective on a lifetime opportunity to be wholesome.
If you do are enjoying this wholesome, genuine listening.
Someperienced family fun for the whole church.
We gotta wrap this in, please do feel free to leave us a review and rating. We read them, Potential new listeners read them to. It's how they can to find their wholesome experience and get the friend letter for womenspodcast dot Com.
Thank You Bye.
Frugal Friends is produced by Eric sirianni.
Oh Man. What's something that's wholesome whole wholesome grains is that a word that you might find on food packaging.
Whole grains, possibly wholesome grains, wholesome.
When I think of a wholesome person, they're probably wearing a dress.
I think everything that I think of as wholesome has been ruined by someone who's made a horror film. That's so true, you know, like if I can think wholesome like Teddy Bears, and then I think, oh no, Teddy Bears have definitely been ruined ted it's not wholesome. It's not horror film. But yeah, I don't know. I don't know what's wholesome.
It's probably what pres are, probably not peers that we're so jaded.
We're not.
We don't believe anything wholesome.
We're not adjacent to wholesome. So that's why we can't think of anything.
We don't curse on the podcast because wholesome, because we actually have funny things to say.
We don't need to rest on profanity to be funny.
Off the mic, though I love me, she doesgen does.
I'm going to just project it on her though or innocent clean she's reading the dictionary definition.
Wholesome things examples.
We have to google it because we don't know.
What is the most wholesome thing you've seen? There's a New York Times that pay for it to read it.
You got to pay for a dollar a week.
Wholesome, they're extortions.
Have some an unwholesome to say about the New York Times.
Oh, animals, that's true. Babies and animals babies together, when babies and animals are getting along, or just mostly when animals and animals are getting along.
Yeah, we do love an animal Instagram account. What's your favorite animal Instagram like animal themed Instagram account? Mind's raccoons.
Oh, there's one that I watch. I forget what it's called, but this guy does voiceovers on animals doing crazy stuff.
I love that. Oh, I love the voiceover guy for the pigeons in Australia.
Yes, but that's not wholesome. No, it's not allSome.
Day it back to the drawing board.
It is funny though,