Special Edition: Secret Money Tips, Part 2—Understanding Debt and How to Invest in Yourself

investing financial empowerment one oh one. Now we're bringing that advice to every young woman through this series. Today, we're talking to Carmen Perez, CEO and founder of Much, a budgeting app. Carmen is also the creator of Make Real Sense, a personal finance blog dedicated to helping people achieve financial independence. Carmen, it's great to have you on the show. Welcome, I'm so excited to be here. Thank you for having me. Well, we had such a wonderful time hearing your advice at

the New York Stock Exchange and we really learned so much. So, Carmen, tell us briefly about your financial journey. What was your experience like growing up as it related to money. Yeah, So this is where I think, like the term financial trauma comes into play, and just understanding what your relationship

with money is, and that usually happens early on. Right, I was raising a single parent household, and while my relationship or my mom made it seem as if, you know, everything was fairly consistent and steady, I think by seeing her, you know, work so much and so hard and always figuring out, you know, at the end of the day, how to make something work. I think I carried that into my relationship with money later on in my adult life. So you know, getting up to living paycheck to paycheck,

just maxing out every sense of my paycheck. It was my norm and that was something I feel I took early on as it relates to my relationship with money, and just ran with it into my adulthood. So it's like, wasn't necessarily making the best financial decisions, but I could always figure it out and make it work somehow. What impact did that happen? I mean, how did that help or hurt you in the early days? Yeah, so that was it kept me in a constant cycle of stress.

So it was a very big cycle of just rense and repeat in terms of making terrible financial decisions when I had every opportunity not to do that. But again, in the early stages, how your relationship is with money, it's usually formed by apparent figure. And again that's what I took with me, and it really ended up hurting

me for a little while. You know, now I have a great success story, right, but in the early days, it kept me in a constant level of low lying stress, constantly worrying about, you know, how to make it work. And at one point, I understand you were in fifty seven thousand dollars worth of debt. What led to that and how did you turn it around? Because you turned it around I did. Yeah, So the fifty seven thousand dollars of debt, I think for me personally, I think

this relates for a lot of people too. Is you have to hit like some type of you don't necessarily have to, but a majority of folks are catalized by some rock bottom. And my moment was getting sued for my student loan and that was a thirty thousand dollars loan within that fifty seven thousand dollars of debt. And you know, the journey really consisted of credit card debt, so maxing out all of my credit cards, taking on

student loans, but really the catalyst was getting sued. So I had all these terrible things happened up until that point. I had a job offer resended that had terrible credit. I was being eighteen percent interest on my car loan that was also included in the fifty seven thousand dollars of debt. My taking a step back happened when I got sued and I had no money saved, and I instantly was, you know, catapulted into this world of having to navigate my finances very quickly within a short amount

of time. And it was just like a light switch. I woke up to the idea of like having to not have to live under distress anymore. You know, I was privileged enough to not have to do this, but I was putting myself through the stress subconscious again my relationship with money, and I had to start navigating that and feeling that back. And it was layers and pall layers of doing different things, but eventually paid off all

of that debt. Wow, congratulations, Thank you. So if there was one thing that you would take away from that experience that you could share with those listening. I mean a lot of people you know have debt for different reasons. But I think you feel that some of that debt was good debt in the sense that it was, you know, financing your education. Obviously you had to pay your medical bills. I mean, that's just investing in yourself. But maybe some of the habits that you had around the other debt

was sort of compounding things. What's the difference. Yeah, So I think debt and I feel like maybe even early on, I had a different relationship with debt. I felt like it was normalized. Everyone has it, My mom hasn't, my friends has it, everyone around me has it. I'm going to be in debt forever. Right That was kind of my attitude towards debt, and right now my relationship over time has changed with debt. The way I view it is,

you know, debt is inherently a financial tool. It's not good or bad, but how you leverage it or misuse it can get really tricky very quickly. Right And I look at, you know, my debt in the past, just having you know, some awareness around it, as my student loans really did help me get through college. Any other way, I wouldn't have been able to, you know, finance my education. I had to take out the student loans. I've bought

a home and since sold it. But that was a good way for me to you know, invest in an asset that could eventually you know, give me some cash down the road, right, And we made some profit off of that that sale. But on the flip side of that, right, like my credit cards, maxing those out and perhaps having a store credit card just wasn't I wasn't using it in the right way or leveraging it to my advantage.

So I'll give you an example. I had an express credit card, and I would just go in and just max it out on you know, just normal everyday clothes, whereas I could have used that store card to actually build my credit in a productive way get the things that I actually needed, which were internship clothes that I knew that I needed, right, instead of maxing it out on stuff that I just didn't necessarily need or was

just seeking the instant gratification around. And I personally don't think, you know, behind clothes and jewelry and all that stuff,

is it bad. That's that's not it. Um. I think it's just important to find some balance in that relationship with debt, right right, And I love when you talk about kind of investing in yourself in that way and investing in your education or investing in the wardrobe you need for your interviews, but just being a little bit more cautious about, you know, kind of impulse purchases and not just thinking that you can max out on everything

all the time. Yeah. I mean, one really interesting concept that you have is, uh, you know, is it ever too early to start thinking about these things. I mean, some people listening, you know, they're just getting started. They may not have an income yet, they could be young students, or they just are not seeing a way out, or they're seeing, you know, that what they're doing is really small potatoes. What do you say to that? Oh? I

love that. Yeah, so the small potatoes thing, right. I thought, again, my early thoughts throughout debt were I'm always going to have this, I'm never gonna be able to pay this off. But you know, similar to how we kicked off is how you manage a little, is how you manage a lot. I thought, you know, my salary at the time when I just graduated college wasn't going to afford me enough to be able to, you know, pay down my debt, or wasn't going to give me the ability to start

investing in the stock market. So my thought around that and my mentality was, oh, i'll invest win or I'll pay down my debt win. And I think everyone's always chasing that kind of next milestone when it whether it becomes their career or when it comes to their money. And if you aren't managing the money that you currently have and you're making in a productive way, those skills aren't just going to instantly turn on overnight when you start making you know, big bucks, right, whatever you deem

that to be. It's really taking a step back understanding your current relationship with debt. So maybe you're a newbie, or you know you've made some mistakes in your past, like I did in terms of running and maxing out my credit card. But you take your step back examine your relationship to really understand why am I doing the things that I'm doing, or perhaps am I scared to take on debt if I'm a newbie, or I see my parents having gone into a bunch of credit card debts,

so I don't want to be like them. So again it's it's the mindset of just because you have a little, it's not small potatoes. Whether it be your income or the amount of debt that you have. The habits that you build now are extremely important for when you get bigger debts in terms of let's say you're taking out a loan to start a business or a car loan. The habits that you're building with the small things now will carry over into the big things later on. Well,

and you are such an incredible example. So you turned it around. You say that your early habits created bad credit, but you turned it around. Now, tell us a little bit about what you're doing now and some of the milestones since that low point. Yeah, so there's been so incredible milestones after paying off my debt, and you know, again, some of that included some really productive things, like my

degree and all of that. So I obviously graduated, I went to work on Wall Street for a bit, and that gave me the career that gave me enough money to do the things that I needed to do so in order to pay down my debt. But after that I found, you know that I wasn't as passionate about traditional finance as I originally thought. I was. So once I paid off all my debt, the closer I got to, you know, making that last payment on my debt, the more my vision started to open and broaden. The door

started opening like wide for me. So I went on to save a bunch of money to be able to quit my job in finance. And then when I quit my job, my intention was to learn how to code. So I transition careers in my early thirties to from out of a traditional finance to software engineering. So it's

possible for anyone to be able to do it. But more importan, after changing careers into a very lucrative field where I could potentially continue to increase my income and have my own skill set now in terms of software engineering, I started my own company called Much and Much is a social money and management platform that for people that struggle with money and accountability and then also access to

an awesome you know on platform money community. I love that, yeah, that you can connect with other users and just feel less alone. Well, I have to say, Carmen, your story is incredibly inspiring and I learned a lot talking to you and meeting you again. I love what you say that how you manage a little is how you manage a lot. And I think everybody can take something from this conversation and just re examine their own relationship with money and their own relationship with debt. And we're super

grateful for everything you're doing for us. Thank you so much for having me on. I really really appreciate it. And you know again, I love to leave everyone with this quote, You're always one decision away from a totally different life, and it's very true in my own and whether that looks like relationship, or job or your money, you're always one decision away from a totally different life. It's great to have you on the show. Thank you, Thank you, Carmen. Let me recap some of what we

learned today. First, the money habits that young women are building right now matter and they'll continue to matter for years to come. Even if your current income is small, what you do with it is important because, as Carmon says, how you manage a little is how you manage a lot. Second, think about debt as a tool. If used properly, it can be leveraged to improve your future. Debt allowed Carmen to go to school, and that opened up doors to

more opportunities than she could have ever imagined. But you also have to be careful not to abuse debt, as Carmen says, and make sure that you're using debt in the right way. Finally, it's never too late to re examine your relationship with money and perhaps move in a new direction, one that might be different than your parents or your friends. As Carmen says, you're always just one

choice away from a totally different life. Join me next week for more money tips for young women on our next episode of Seneca's Conversations, Secret Money Tips in partnership with Secret Deodorant. Thank you for listening, and please share today's podcast episode with the others in your life. This is Kim Azzarelli, co author of Fast Forward and co founder of Seneca Women. Seneca's Conversations is a production of

the Seneca Women podcast network and iHeartRadio. For more podcasts from iHeartRadio, check out the iHeartRadio app, Apple Podcasts, or wherever you listen to your favorite shows.