Earning $400,000 and Still Drowning in Debt
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It's time for the V, A, Q, A, A, V, A, Q, A. What you say? The V, A, Q, A, with mon day.

The B, A, Q, A, the B, A, Q, A, A. What's A B, A, F, M, A? I am so excited to be here with you.

I'm a little recipe today, but i'm kind of into IT. I don't know why i'm into this getting older, getting a little bit recipe, are getting some grit on them vocal cords. But today is the Q N A, which means the yoga questions.

I have some answers, but like with a lower case, a OK, as I say, you're gotta get those salt shakers out, because everything that I say on the show take IT with a grain of salt. Don't sue me. You can call your attorney, but you are gonna a sue me.

Okay ay, this is for pure entertainment purposes. I maybe a fabulous career in money coach, but I am not your personal career money coach. And honestly, we don't know all the details, right? So if I say something, it's just for fun and i'm doing the best I can.

But like obviously, we don't have all the information. So again, don't do us. Thank you.

who? right? So our first question of the day comes from instagram.

And if you all want to send us a question, keep saying us because it's like there were us, but now it's me. And it's like, what do we do in this new era? B, F, M, just know that i'm trr ying trying.

I'm so a little hunger about my eggs. Love tivy. All right. This question is from Regina, from I G. Yuk can hit us.

Hit me up prohibition podcast on instagram if you want to have your question answered on the show. Also prohibition podcast at gmail, duck on all. Regina says he love all the content you'll do.

I have been following alpha a few years now. My question is that I have a four one k from a previous employer still sitting with the original broker. I opened IT in when I worked there, which is T I A A. I am now with a new employer, and I have a four one kay through that employer, through a different brokers, which is fidelity. Now I realized I should roll my original four one k into an ira for ease.

Should I just rolled over to my new program? If I do this and then end up with another employer later in life at another broken age, would I then be able to roll both my, I ra and current active for one k over? I would imagine i'd wanted keep them together, just so I don't forget where my money is.

Hello, thank you so much for your thoughts. And no, I won't sue my Brown bestest. Thank you.

Regina. Regina got her solo take around. He knows, okay, but this is a great question, Regina. And I think our instinct is important, which is like for you, you would wanna keep them together because you worry that you might forget where your money is.

And that is a real concern here, right? As if you have accounts and all different places, life is going to life. You may have several jobs um over the rest of your career and I can IT doesn't seem like you know possible but IT is very possible to forget that you have some money left over.

I am myself have like fifteen hundred dollars or something like that saved in a foo k that's now been rolled over into an I R A from a previous employer. And I still have not got around because everytime I think about IT, I like I got to do that and then I just don't do IT because I go to log in and I don't know my password and I like i'll come back at another time and IT sh'll see. No, it's a little bit there's friction there.

It's not so simple. It's still like takes effort to do IT, right? So and I ichael does not go in anywhere, but what if I forget to have this fifteen hundred dollars? Just not a lot of it's not a little bit of money, you know.

So we don't want that to happen, right? So if you think you may be inclined to forget, IT may make a lot of sense to just take your previous employers for a one key and roll IT over into an array that you own, and then make that array your destination for any future for when cave. All lovers.

okay? So that means if you leave the job that you have now and you want to move your four one key out of the fidelity account, you already have this array opened with that, that has your previous for one key already rolled over. And then you can just add and then open up your new for a one key, whether your employer has their partnership with.

Another reason is great to roll IT over um is because you're four one k through your employer and may not have all of the investing options that you want. They may have very limited funds or the funds that they do have maybe more expensive than what you can find opening your own broken account, like through a var or a swap. The good news is that, I mean, finally, I A, these are both platforms that should have a wealth of options for investing and low cost investments as well.

So you could be good, you know, just keeping your money parked there in that account. Um but let's the other side of this is okay. I don't want to open array even if I do designate that as my four one k roll over pot for the rest of my career, I would rather just take my foreign key from my previous employer and rolled over to this new for win ky at fidelity.

You can absolutely do that too. That takes a couple of like cos at the equation IT means that you won't have to keep track of that for one k roll over, I ray, that you would open and IT just sort of gives you something to pick IT gives you something to build on through your four one k at your new company. So those are a couple approved.

But for me, it's really which option is going to work Better for you, the simplest, which means like I can just do one thing and kind of a get this ticked off and I know that i'm not losing or keep not losing track of the money that I is just to go ahead and roll that for a one. K, L, T, I, A, A. Here's where you can send my money.

They'll rolled IT directly into your new employer, provided for a one. k. And you can, you know, keep IT moving. You can keep doing that for the next job and the next job and the next job that you have. This like snowball when k baLances that you're moving over.

But IT can't hurt to take a couple of extra steps to say, okay, long term, maybe I should have my individual broken age where I can roll these accounts over into and I can control what types of investing options I have. There's no bad the answer here. There's just slight differences.

And at the end of the day, it's up to you and what you're willing to do, how much work you're willing to put in and how much effort. And it's yes, it's up to you. But that's a great question, Regina, and thank you so much for sending that. I'm going to take a quick break and the right back with question, too.

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And this is a question from mrs. Ex from instagram. SHE says, love you all, love your show.

Tifany one, miss you. Girl, you, me too. okay. He says, my name is misses x and my husband and I make a combined income of nearly four hundred thousand dollars, yet we are in hello credit card debt to the point of almost paying hundreds and over drapes overdraft feeds wondering why credit card debt cause overdraft fees.

I'm going I guess you mean like late fees or or um interest fees but regardless, you're paying extra money on top of the dead, right? We have a child in private school and no one who will be starting college. We have a child in private school and one who will be starting college soon.

Oh, we also have a high as monthly tax bill. We're considering taking alone to wipe out all credit card debt and try to live off of one income or live off of one income to save for college and emergencies. Is that the right thing to do? Please help.

Thank you. Oh, mrs. X, well, the first thing is thank you for sharing this. I in the world of like internet bulle chattery and where everybody has a microphone and like to cast judgment upon anyone who has something to complain about, this is the kind of thing that would like really pissed internet commentors off. It's like, oh, mrs.

Explore you, you're making four hundred thousand dollars and you're so bad with your money that you have all this credit card debt and you have you chose to put kids and prove at school. So like this is all your own doing. And europe pizza garbage, that's not why you're here.

mrs. Ex, you're here because I think you have represent a lot of americans, a lot of working people who are making good money. And yet because of the inflation that's happening, and because the best choices for our children often are more money.

And as a parent myself, I get IT. Now, I really get IT. So I make decisions not infrequently that are not in my own best financial interest because they are what's best for the kids.

And that is so real and was so real. It's not like you can look at a piece of paper. I feel like this is like in the age of um will call him dr. We wonder who i'm talking about, these old school financial educators or financial influences who will look at someone like you inside, take your kids at a private score.

What's wrong with the public school down the street? You know, you could probably be saving sixty thousand dollars or hover much your annual tuition is and just put that money into paying off your debt. But I get IT because, like your child's education, at least in my mind, IT is one of the most important investments you can make.

And if we're gonna be scrimping and saving, is that where we're gonna a pull or trim the fat from to you? That is up to you. That is your own dam business, mr.

ex. And mr. Y, that is up to you. You all chose to put your kids in private school because you want what you want for them. And that is none of our business, but also doesn't help when IT comes to just your overall question, which is like we are earning this much money, but we have this credit card debt.

So now you're wondering, how can I get some relief not just from the credit card debt, but from the fees that are associated with IT? And I am in a very similar position right now. mrs. X, high earning household started to put more and more expenses on credit cards, got a little too comfortable doing that, and then realize how to quickly that debt can start to accumulate just because you're paying interest on IT in those interest charges add up. It's like the beauty of compound saving.

When you put money in a savings account and you start to earn interest on IT and then the money that you are in interest gets added in there and then you get more interest, then you're earning money. You're earning interest on the interest. You say it's just like a fly whe of savings, right? But the same thing happens when IT comes to credit card, dad OK.

So it's very easy to see how you can get overwhelm. I'm just trying to like validate um that is difficult right now. Here's the uncomfortable truth that I and my husband i've had to face to or mostly me the other day I was literally I can't believe i'm told you guys on this show. I literally was in target IT was the day after halloween. And when I tell you mind, budgie was stack to the ceiling with stuff because they had their fifty percent off of all the halloween stuff.

And those yellow, clear and science were up and I was like, oh, we need this for the kids for next halloween, and we have a halloween block part and I should start stockpiling, you know, decor and and plastic cups and disposable this and that and decorations and all this like, and goody bags and errors ers and minature bubbles in the shape of, you know, dracula things, and like all this nonsense. And not only was the buggies stack higher than me, I mean, like, I could not see, I should you'll post a picture I could not see over the top of my own frequent target caryl. And then, but bring, I look at my phone, and there is an an identified number calling, and I, my g Polly, an election campaign.

But then I hear that do, which is my calendar, saying, hey, bet you have an appointment with your planner right now, you forgot about IT. And not only, not only did you forget that you had disappointment, but but you were standing in the middle of target with all their ship that you know you shouldn't be buying, that you know you're not to put on your target red card and you're going to somehow try to justify because you give five percent off on the target with five percent cash back on your target red car, and also with all of fifty percent of really saving money in the future, right? Oh, my days.

I look, I look at once I realized to IT was that call that was calling i'm not proud of myself. I sent to a voice meal. Okay, I sent to a voice meal and I kept on going and my heart sort starting to race.

And i'm navigating the store and i'm trying to like, get down these eyes and i'm peaking around this giant fuck like ten foot tall pumpkin playing and air guitar long decoration that I just had to because I thought my son would think would be funny. And I am trying. And the skeletons are not making this up.

Skeletons are falling off of my car because it's too piled high and they're an awkward shape. And i'm trying to like tech them back into the bugging. I get to the checkout area.

I look at my phone. The guy from the financial planning firm has sent me a text message, hey, i'm so sorry. We we doesn't seem to we haven't seem to be able to connect. Let me know if you still have time, and I just, i'm not gonna. I started to sweat and I picked up the phone and I called him back. I called him back and I had one hand on my car and the other hand on the phone, and I just standing near the truck out because I like this guy, doesn't even know how deluded I have sort of become. Not okay, not deluded.

But he doesn't even know how like I have I have like tricked myself into thinking that everything is fine and how I in such this like spiral of overspending now and it's like it's really starting to bear me and now it's becoming IT has become an issue but IT was so humbling and so Frankly embarrassing and shame inducing he, you can even see me we're not on face time but just the fact that I am talking to him and I have one hand on this buggy y full of halloween shit that I do not need an on about to put on my credit card like the shame my inner shame is so high at this point and I see the optics like somebody snap a picture of me and puts IT on the internet with the mean saying um financial educator at target spending beyond her means on the film with her financial planner to talk about uh had a manager or credit card debt like I I get IT I get IT I can see IT and it's really great like I don't want to say crazy because I something that we all like so many of us go sorry right at certain seasons in our life so anyway, i'm talking this guy and and he has all of my accounts uploaded because at this point at least, I have done the work to like get all my accounts on the system. The platforms that he can see where stuff is and all that. And i'm telling him that OK, yeah, we have know this credit or dt.

And right now, a lot of IT, most of IT is on percent interest to credit cards that those interview periods are gone to be expiring over the course of the next year in different time periods. So but it's like it's gonna fine. I was just think that maybe what you know take out a whole equation of credit, you know tapped into the equity in our house.

And shouldn't we do that? Because you know some banks, they may pull back from offering home equity loans because of the economy um because the same way that they did during the pandemic and pass recession, they stop offering them so much. And so that means that could just be smart really just to take out this hole equity line of credit, just to have IT like as an emergency and also to pay off this credit card debt like this seems to make sense, right? And I wanted him to validate me.

This poor guy, by the way, is first session together because he came I had the a free consultation through my um through my financial planning. My financial management platform is called in power. Check IT out if you want to.

I don't get paid by that. Maybe I aren't you but anyway um he's said and I can tell he's like he's listening is like aha, aha. Well here's the thing.

If we don't treat the underlying issue, which is that you are spending more than you make and it's a small bits. It's not like anyone. Huge um spending spray has pushed you so far over the edge, but for a no extended period of time.

Now i've been i've been transparent about how and twenty twenty three, I was super hard for me because I couldn't work. I had a baby. I'm writing a book.

I'm going through all this dma with my dad being sick. I wasn't able to produce the income that I needed. And now we're constantly like trying to keep up with that, right? Trying to build back up.

So as an extended period of time, he's just like a home amErica credit won't fix IT. He wasn't this blood, but he was pretty much what he was saying. The hey, luck is not gonna x IT.

It's just going to put you in an even more vulnerable spot because now your home is tied up in IT. Now you could lose your home if you can afford to pay back the heat lock. If you draw, put take a draw off that line of credit, we've got to solve the underlying issue of the overspending, and that is when we can sort of move forward from there.

And I want I tell you, like obviously, that's the answer. Like I know that I know IT very well, but it's like when you have them, the fact in front of you and the logic and the reasoning is there. It's really it's you sort of need that wake up call.

I think as a as a parent um because that is so easy to justify like so many decisions if it's for the Betterment of the kids. But if i'm really being honest and i'm being like tough on myself, I would say what's really Better for the kids and them mommy and daddy are not putting them in financial chapter d in the world, putting ourselves, I mean in financial jeopardy in the long run. Um to sort of like for the beta of the kids that sort of like puts all this blame on the children shoulders.

Like, well, you really wanted that fifteen dollar hot wheel monster truck. You know what I mean, like you really needed to go to legal and for your birthday, you really you know that's not exactly fair. I don't think it's fair at all to the kids.

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So i'm not taking me back to humans as x.

I'm not saying that the answer is like take the kids at a primary scot, but I do think you and your husband, just like me and my husband, maybe we should be friends, maybe we should all all sit down together and just look at the budget, just the bare bones of IT all, how much is coming in? How much is gonna a be going out? And if we can't trim certain things, are we have non negotiable that we don't want to to get rid of? Well, then it's a wake up call.

It's like, so where is the extra money gonna come from? And maybe you're like me, maybe you have wind falls that you know we're gonna be coming. Maybe you guys have an annual bonus that could be coming in january.

Every worry to help you take on chip away some of that debt that was me incorporate. And honestly, having those windfalls were a huge like god sent for me knowing i'd have an animal bonus or I could I could exercise some of my stock options and then get a little bit of a wild fall. And that could help me, you know, keep some of these debt at bay. I'm still Operating a little bit the way that I was Operating during corporate when I would, you know, have a couple of these like financial windfall each year and maybe you guys do to.

But let's get ahead of that and plan for IT so that we know okay, when that bonus comes through, when that tax refine comes when the equity vast, we know immediately it's got to go toward these debt payments and then how long would that take us? What can we expect to get from those when fall? And how long would IT take us to really chisel away, chip away at the rest of this? Det, okay.

And then we need a budget. And it's really annoying when you make four hundred K O year, which is like a about what in my um are bringing into collectively like three to four hundred, like it's really unknowing to them think oh we need to be scraping and like using a budget at least for me. I'm like uh budget like I want to think about that what I like, that girl starts, I like grab my stuff and go and sorry, that's not, that's not gona work.

You know, that's not gonna work. For right now, there does need to be a conversation about what is our budget for groceries, what is our budget for eating out, what is our budget for child activities and entertainment and you know and babysitting for date nights and all of that lic. We do need to have those difficult, uncomfortable conversations and like maybe stop telling ourselves that um we don't necessarily need to because we are in a certain income bracket and that kind of stuff, you know, is maybe beneath us or like just just anticipating that, that they'll be more, more, more to to take of the step that we are accumulating in the process.

This is really, really uncomfortable to talk about. I'm personally like I don't think i'm exactly slight but I did not anticipate telling all about my whole target experience right now. But my show and i'm doing IT, but mrs.

Ax, I just I really see where you're going through. Um I do think taking alone to wipe out all your credit card debt is an option. I think IT can be a smart option when IT comes to consolidating a fixed right personal loan, a fixed rate, that consolidation loan unsecured. That means that you don't have to put your house up as collateral like you do with a he lock or homework ity loan. There can be a good idea to wipe out the credit card debt and make IT less expensive for you to pay down.

But as I was just told by this very kind man from mpower the other day, my finances planner, um it's just going to accumulate again if we don't get to the root cause and we don't really get budget in place and stop the gosh stop the leaks in our own budget, stop the money from seaming out the cracks and disappearing and then leaving us with an even bigger problem, even more cracks to our foundation, because we're letting that, you know, that underlying issue not get solved. So living off of one income to stay for college, that was your second idea, you said, is that the right thing to do? I think that's an amazing idea.

And IT may be that, you know, that is a way that you all can create the space to put away money for your kids college. But is there a plan? Can you actually live off that one income? Can you actually pay your expenses and all your household needs and all your savings and investments and all of your goals and still of and avoid that credit card dead because if you can't actually live on that one income without credit card debt, it's going to accumulate again.

And that's just where I get a little bit of stress, you know because you've got fourteen or k usually now and you still have credit card debt. So take away you know half a salary and what will happen. So that's the concern.

mr. Ax, please follow up and you're i'm gonna keep keeping in a hundred because I know i'm alone. I think IT was something like over seventy percent a brand ambition.

Listeners say that credit card debt and overall debt is their biggest financial stress. Er right now and we are in IT together. B, A, M. And this is ask thank you for something in your question. B, A, M, thank you for listening again. You can hit this up brand ambition podcast at G M 点 com or and as A D M at brand ambition podcast on instagram if you want to have your question featured on the show until next time。 bye.

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