YFP 352: Pharmacy Innovators with Kelley Carlstrom, PharmD, BCOP


In another episode of the Pharmacy Innovator series, Dr. Kelley Carlstrom, CEO and founder of KelleyCPharmD, discusses entrepreneurship in oncology pharmacy.

Episode Summary

On this episode, we have another segment of the YFP Podcast’s Pharmacy Innovator series! Hosted by Corrie Sanders, PharmD, this series is tailored for pharmacists venturing into entrepreneurship, featuring stories and strategies for aspiring pharmacy entrepreneurs.  

This week, we delve into the dynamic world of entrepreneurship within oncology pharmacy with Dr. Kelley Carlstrom. Kelley is a board-certified oncology pharmacist and CEO and founder of KelleyCPharmD, which addresses crucial gaps in clinical oncology training. Dr. Carlstrom shares her experiences working in traditional and non-traditional settings, healthcare technology, insights on her transition from employee to entrepreneur, her evolving business model, and opportunities in oncology for pharmacists. Kelley also discusses how to monetize your expertise and the value of communities when starting a business.

About Today’s Guest

Kelley Carlstrom is the CEO and founder of KelleyCPharmD, an education company that fills the considerable gap in clinical oncology training. She is passionate about democratizing oncology pharmacy education and increasing accessibility and inclusion through her unique L.E.A.R.N Oncology Method.

Kelley received her Doctor of Pharmacy from The University of Colorado and completed post-graduate residency training at Beth Israel Deaconess Medical Center and Dana-Farber Cancer Institute in Boston, MA. 

She is a board-certified oncology pharmacist that has worked in a variety of traditional and non-traditional settings including at large academic and small community cancer centers, as a consultant for a large electronic medical record implementation, and in the healthcare technology space helping create digital products for oncology clinicians and patients. 

Kelley is also a prolific content creator, sharing clinical and motivational pearls about oncology. She is part of the LinkedIn Top Voices program, an invitation-only program that recognizes and celebrates the most influential and engaging professionals on LinkedIn.

Key Points from the Episode

  • Entrepreneurship pathway in oncology pharmacy with Dr. Kelley Carlstrom. [0:00]
  • Career transition and business ideas for pharmacists. [2:34]
  • Starting a business in oncology and program design. [6:24]
  • Building a successful oncology pharmacy business model. [12:27]
  • Transitioning from consulting to entrepreneurship with a pharmacist. [18:00]
  • Leveraging clinical skills for business growth. [23:40]
  • LinkedIn usage and its impact on pharmacy businesses. [28:37]
  • Oncology pharmacy roles and opportunities. [36:07]
  • Oncology pharmacy training and business model. [42:27]
  • Entrepreneurship and decision-making with KelleyCPharmD. [49:35]

Episode Highlights

“You know, once you have a problem, it’s great. But then you have to figure out what’s the best way to solve it both for the both for the customer and for you. Like you don’t want to build a business that you don’t want to run.” – Kelley Carlstrom [7:44]

“So I think when the number one thing I would encourage pharmacists to do is to connect with people that are interesting to them, not just you know, other pharmacists.” -Kelley Carlstrom [30:20]

“When I got into entrepreneurship, I realized you need to make decisions very quickly. And if you’re always second guessing yourself, it’s not you’re you’re not going to be successful.” -Kelley Carlstrom [48:11]

“There are no bad decisions in entrepreneurship. It’s just you have to get off of the table and start walking and start doing things. And that’s how you learn.” – Kelley Carlstrom [48:55]

Links Mentioned in Today’s Episode

Episode Transcript

Corrie Sanders  00:00

Hi YFP community, Corrie Sanders here, host of the Pharmacy Innovator segment of the YFP Podcast. Pharmacy Innovators is designed for pharmacists navigating the entrepreneurial journey. In this series we feature stories and strategies that help guide current and aspiring pharmacy entrepreneurs. Today we have Dr. Kelley Carlstrom, known on social media as the oncology pharmacist. Kelley is the CEO and founder of Kelley C PharmD, an education company that fills a considerable gap in Clinical Oncology training. Dr. Carlstrom is a board certified oncology pharmacist that has worked in a variety of traditional and non traditional settings. This includes a large academic medical center, small community cancer centers, and then the healthcare technology and startup space. Kelley is also a prolific content creator and was recently invited to be part of the LinkedIn top voices team, an invitation only program that recognizes and celebrates the most influential and engaging professionals on LinkedIn. Dr. Carlstrom is a returning guest the podcast and was featured in August of 2021 on episode 217. We will link to that episode in the show notes as it provides great detail about Kelley’s background and pharmacy journey. Today we speak to Kelley about the timing for her jump from employee to entrepreneur and dive into her unique business model how her business has evolved over time, and opportunities in oncology for both Kelley and the pharmacy profession as a whole. Kelley share some great lessons surrounding monetization of her expertise as an oncology pharmacist, to include the value of various communities and reflections on decision making both inside and outside of clinical practice. Now that we’ve set the stage, let’s dive into today’s main event. Our incredible guest, Dr. Kelley Carlstrom. Kelly, welcome back to the podcast. It’s great to have you.

Kelley Carlstrom  01:46

Thank you so much. I’m excited to chat again.

Corrie Sanders  01:49

Well, I know that you and Tim recorded in August of 2021. And during that time, you guys did a great job of really diving into your educational background, your pharmacy career path, what we want to really dive into today is that entrepreneurship pathway, and what exactly that looked like for you when that started in your career. And we’ll get into some details about your mindset and growth. So let’s start with really diving in to the consulting portion of your career. Before that you were in a large academic medical center, you were in an outpatient oncology clinic, and then you transitioned into consulting. So let’s talk about that consulting. How did you find that job? What important mindset shifts happened during that job? And how did that ultimately set you up for success with where you are now?

Kelley Carlstrom  02:34

Yeah, I love talking about this transition, because it was completely unexpected. In my career, I thought that I would be in a clinical practice role my entire career, you know, I spent a decade training in school and in residency to get that type of role I was in, and then all of a sudden, I was I was entertaining, moving out of that role. And I really had a lot of doubts and a lot of conversations with myself during that time about whether I really wanted to do that. And what it came down to was me kind of thinking through what’s the worst that could happen. You know, it sounded like a really interesting opportunity, this consulting. And being in clinical practice was kind of the safe bet. Like I knew I would always have a job that would be very, very comfortable. And consulting was a complete black box. I knew nothing about it. I didn’t really know what they were hiring me to do, which was a Cerner implementation, I had always worked with Epic in the hospitals I worked at. So it was very scary. And I just decided to jump in and see what doors it opened. And it opened a lot of doors both. From a job perspective, and like networking perspective, but also a lot of doors kind of, for me personally, kind of my mindset, how I thought about how I thought about where my career would be, because when I first started consulting, you know, they were paying me very well. And I didn’t, I had never seen a pharmacist in that type of role where I was there, essentially, for the knowledge I had. I wasn’t doing any of the building in the EMR. They had a whole team of analysts that were building, they were hiring me as that clinician, that liaison between their clinical end users, their doctors, nurses, pharmacists, and their Cerner builders, they needed somebody in between to kind of talk both languages. And that was really the first time I’d heard about that role. And that that led me to see like, man, there’s a lot of skills pharmacists have that we don’t talk about, we don’t recognize, we don’t market. And that’s that’s what really opened my eyes to thinking, oh, there’s a lot more out here that I could, that I could dive into. And so that’s how my business ideas kind of got started. I started having a whole bunch of ideas about how how else I could solve problems besides this kind of one specific problem I was solving during my consulting contract. And over time, I just started to iterate on that and lean into it. And it’s been a very interesting journey.

Corrie Sanders  05:06

Yeah, it’s great to hear you say that. Pharmacists aren’t very, don’t realize maybe some of the clinical or some of the skills that we had outside of our clinical training and our knowledge. And it really takes seeing the profession through a different lens to maybe bring that into fruition, and shine a light on some of the skills that we have that have nothing to do with clinical practice. But really what role we play in a team based care model, whether that’s from, you know, an electronic EMR perspective, or whether that’s from a direct patient care perspective. So I love that you highlighted that.

And then Kelley, let’s talk about how the company that you have now started to build off of that consulting practice. So you said you started getting some ideas for your company. What did that look like? Did you have people coming to you with specific questions? Were you getting questions from the company itself about oncology? How did the idea for your business really set a seed during that time?

Kelley Carlstrom  06:04

I was getting a lot of questions on LinkedIn for years where I’ve been active for years, but I honestly wasn’t paying that close attention, which is funny now that I look at it in hindsight. You know, you don’t pay attention until you start paying attention, right? And then the light bulb goes off. And you’re like, Man, why didn’t I think about this years ago? But I had a lot of ideas about about starting a business. You know, it was I had stumbled into a couple podcasts, a couple heard of people heard a couple of people talking about entrepreneurship. And I’m like, Okay, that sounds interesting. But I didn’t really there. This was kind of the beginning of the, of the pharmacy entrepreneur, kind of wave, if you will. And so there wasn’t a lot of people talking about it. So I had a couple ideas that were that were ruminating in my brain. But just all of a sudden, one day, I was answering a LinkedIn message. And everybody asked me the same question on LinkedIn, which was, hey, I’m new to oncology. You talk a lot about oncology on LinkedIn, can you point me to somewhere where I can learn it? And I was like, and I always I got this question so much, I had a copy, paste kind of ready to go of like, five resources that I send to everybody. And just one day, and I’m like, I’ve been answering the same question for a long time. Obviously, there’s a gap here, these people are not residency trained, they’re not going to go back to do residency. They’re working in cancer centers, taking care of cancer patients. And they should be, you know, they want to be better. And they should be supported in this. And I’m like, Alright, I’ve got the training, got the knowledge, how could I help them do this? And that that kind of started started the flow of of a million ideas. You know, once you have a problem, it’s great. But then you have to figure out what’s the best way to solve it both for the both for the customer and for you. Like you don’t want to build a business that you don’t want to run. Right? So I spent a lot of time at the beginning trying to figure out how the heck am I going to do this? Because oncology is giant.It’s not like where you can like set it and forget it, I’ll record a couple of videos and sell that and people will learn oncology. No, we get new drugs approved practically every week. It’s a it’s an ongoing thing. So it took a lot of design upfront.

Corrie Sanders  08:19

And let’s talk about that design. So when you touched base with Tim, it was almost three years ago now. And you were just about to launch the ELO program, which is enjoy learning oncology. So I know that that was going to be your first program within your business. How has that developed? What did that look like when you first put that out? And then ultimately, where are you today with the services and the products that you offer?

Kelley Carlstrom  08:46

Yeah, when I talked to him, I can’t believe it’s been three years – I feel I feel like I’m my mother when I say where does the time go? It goes by so fast. But I remember when I talked with Tim, I was at I was I had just finished my pilot version of my program. So when I had sold the pilot, I had reached out to the the people on my email list that I had expressed interest and I said, Hey, I’m gonna build this thing. It’s not built yet. I’m gonna build this plane as we’re flying it. And I had eight pharmacists that raised their hand that said, Yep, well, we’ll buy into this program, even though you have nothing built Kelley. I literally was building it as they were going through the content. And I took their feedback. And I took the lessons learned from that and kind of made changes and made iterations to it. And that’s kind of when I talked to Tim was when the the first official iteration was was rolling out. And it’s pretty much been the same from a structure perspective since then. So I’m going into the fourth year of that program. And it’s been when I think about the structure, you know, for pharmacists that are thinking about starting something, I really spend time take the time to spend time to really think about how you’re going to format the services that you offer. And one, you obviously want to think about it from the client perspective, like, how is the is the service that you’re offering, or the product you’re offering going to best suit the customer? But also, from your perspective. How are you going to design it? So, one, it doesn’t take up all of your day, because as a business owner, you actually have to run the business, which is, sounds like logical, right? But at the beginning, you don’t really think about how many kind of back end, if you will, things there are, you know, not just kind of bookkeeping, like the standard things. But also, marketing takes up a big chunk of my time and relationship building and just client support, customer success, things like that, like they, that takes a lot of time. So when I was building the program, I really thought about one, one challenge I have is oncology is rapidly changing. So I had to figure out how am I going to keep up with this in terms of content? And then two is, am I who’s going to do it? Is it me, or am I going to get other people to do it. And so I settled on a model where I hire other expert pharmacists to support the lesson content. So at any given time, I have 24 expert oncology pharmacists that are in my program, because I have 24 lessons. And they’re the ones that are reviewing the content, kind of making sure it’s updated. They’re the ones that are supporting my clients with clinical questions. And that takes that pressure off of me. But it also frees me up to do the operation side behind it, you know, I need to find those experts, I need to get them the content to review, I need to review their content, because the program is through my lens, it’s my kind of IP. And so just because an expert says we should include something doesn’t mean I necessarily include it, it’s just, you know, I know my customers very well I know what stage they’re at. And so I everything has to kind of filter through what the what the lenses of my client and my particular program. So when you’re designing your your business and your offers, I think it’s really important to think about all those different steps and not get bogged down in the really fun kind of sexy things at the beginning, which is like, Oh, I’m gonna, I’m gonna offer something for sale, it’s like, well, you have to, you have to really think thoughtfully about it and not not kind of box yourself in.

Corrie Sanders  12:27

And I want to highlight a couple of things that you said, especially at the beginning there about one, you had a very small cohort to start. You at eight pharmacists. And you were learning as you said, you were building the plane while you’re flying it, I think that that is instrumental to, it does not have to be a perfect business model. And it’s not going to be a perfect business model. And it is going to evolve over the course of time. So just getting started and realizing that yes, there’s going to be so many modifications and iterations of different things along the way. But all you really need is that small cohort or client base to launch yourself and to figure out what you need and the feedback and the evolution of a business. So I think that that’s really important to hold on is that it is going to not be perfect from the start. And you’re not going to have 100% market share or analysis from the second that you started your own company that will evolve over time. So let’s explain that that business model a little more just because I want listeners to really understand how valuable the business model that you’ve built is. And I think you’ve done such a great job. I mean, honestly, you are one of the pharmacy pioneers and really monetizing your clinical expertise. So you have these programs, and they’re sold directly to pharmacists that are practicing oncology. And how do they buy into that? Are they buying into each lesson individually? Are they buying into packages? Have you tiered them over time? Has that changed over time? What is ultimately the product that the consumer is buying?

Kelley Carlstrom  13:56

Yeah, great question. I have a essentially, I have a signature program, and I have a couple tiers to it. But I have one kind of main tier, one main offer that I want to sell. And the reason I want to sell it, it’s called my ELO Collaborative. The reason I want to sell it is because I know pharmacists get the best benefit from that particular program. When I was for and that’s that’s the one I’ve been building since my since my beta, my pilot project. And when I started selling it, I got people that would reach out to me and say, Hey, I don’t I don’t want this big program. I just want to do the content. And I’ll go through it on my own. And so I do have like a DIY path where people can access the program content, but they can’t access the experts in the program where which is where you can ask questions and get support and kind of hear, hear the experts talk through those real world nuances which are so important in oncology. And so that came about because people were asking the market was literally he asking me to sell them something. So that’s great when that happens, but I think you really do also need to know, how do you get your customers the best outcome, because at the end of the day, if they’re buying into your program or service, and they’re not getting an outcome, they’re not going to talk about you, you’re not going to have that word of mouth, which you do need and is beneficial in any type of business. So I think really, really honing in on on what that offer is. Because if you have a lot of offers, it’s hard to focus on one particular one. So I do have tiers to my main offer. And then over time, I’ve, I’ve considered other kind of smaller offers that I’m always kind of experimenting with, which I think is a really important part of entrepreneurship is experimentation, which I didn’t really understand. At the beginning, I wish I had done more of it initially. It’s easy to get kind of stuck in, like, Oh, this is what so and so guru says, or this is what some other entrepreneur’s doing, I’m going to I’m going to do it exactly for my business. But that’s our businesses, everybody, every business is different, particularly healthcare, clinician based businesses, I have found are very different, like marketing tactics don’t work the same as they do for, you know, other types of businesses. So I think experimentation is really important. But so I’ve got that name program, I’ve got tiers to that program, I also have some individual courses that I’m now starting to sell, I’m actually rolling those out now. And I also do, I also offer like one-to-one mentorship matching. So pharmacists that want to work one-to-one with an experienced oncology pharmacist, kind of like a preceptor and a residency where you can talk with them about maybe a QI project, or maybe you want to change roles, and you need to create a case presentation to present at an interview and you want some help with that. I also do some matching with things like that, but at the core of my business is this ELO collaborative program. That’s what I’m known for. And I help I help pharmacists that are working in oncology today, develop their baseline knowledge, and that’s a very clear kind of avatar or, or target client as well, you know. When I started, I was pretty broad. And I included people that were interested in oncology. But that is challenging, because if you’re not working in oncology today, and you’re trying to learn this really complex field, it’s much harder because you’re not applying it at work. So I would encourage listeners also to think, who is your best fit client, and it feels counterintuitive to narrow and to niche down. But it’s actually the best thing for a small business is be super, super clear. Because when people come across my website, when they come across my LinkedIn, when they meet me at a conference, it’s it’s very clear who I helped. And when it’s clear, that means other people can refer me very easily.

Corrie Sanders  18:00

And that is such an important point. I also love that you talk about experimenting a little bit. And not only using and leveraging experimenting to get to that target audience. But there’s no wrong and experimenting as an entrepreneur, trying to figure out who your ultimate end user is how that changes over time. And then it sounds like you’re doing a great job of also getting feedback from your clients to make sure that you’re providing the services that they want, you’re providing the services that they paid for. And that ultimately, you know, what they’re purchasing is, what they’re getting, and how you can help fill some more gaps and some more needs based off of those responses to I think that’s really great. So Kelly, I want to step back a little bit further. So we talked about the nuances of your business, and the tears and how that’s evolved over time. Let’s talk about the transition from that consulting role to ultimately stepping out and having your own business. Was there something that was very black and white, where the contract ended? And then you decided, Oh, this is the perfect time that I’ll do that. Were you kind of you know, one foot in each camp where you were doing both of them simultaneously, and then you eventually made the jump? What did that transition ultimately look like for you?

Kelley Carlstrom  19:12

Yeah, I straddled a lot for a long time. And I think I think most pharmacists could probably appreciate the fact that I was very risk averse. When I was in clinical practice. I think a lot of pharmacists are it’s probably a bias for who they let into pharmacy school or at least did when I applied you know, it’s just a natural tendency to be like, this is risky, I don’t want to do it. But when I jumped into that consulting role that kind of gave me that initial like zing if you will, of what it felt like to take a risk and it didn’t, it wasn’t terrible. Like alright, I survived this risk and I got a lot of benefit from it. So that that led me to think okay, what’s the next next risk I should take? Now with that said, I still I was very cautious at the beginning because I had so many ideas. I knew zero about business. Like in my pharmacy program, we had that classic, you know, business course, which was really an independent pharmacy course. So I didn’t take it because I wasn’t interested in it. So I knew nothing about business. And I was really nervous at the beginning, like, I don’t know anything about running this business. So I didn’t want to invest a lot of money into it, I was willing to invest my time, kind of my sweat equity, if you will. And that’s what I did. I had like, all the free tools, my email tool was free. I did pay, I did invest for some business coaching upfront, but for the most part, I tried to spend as little as possible until I validated the idea and people were paying me money. And then when that when I got that validation, and I started investing more, I realized, okay, if I can continue my day job and have the revenue, the income from that supporting my life, and anything extra that I make from my business is you know, is I don’t need to pay myself, I can reinvest it in the business. So that first pilot that I ran, I didn’t, I made zero money, I lost money on it, actually. But that didn’t matter to me, because I was getting a lot of feedback. And I was like validating the idea. And so I kept working I was I did consulting for almost three years. So during the pandemic, I actually had the opportunity to take a role in a in a startup. So a healthcare tech startup that was building oncology software tools for clinicians and for patients. And so what that allowed me to do was continue to straddle those things, I was building my business while I was still making a full time salary. And I did that for about a year and a half, and then transitioned into part time. So I actually got recruited out of that role. And this is a good little side caveat about LinkedIn. I always talk about how great LinkedIn is. And I will continue forever talking about it because pharmacists do not use it enough, we need to use it more. But I got recruited. And I was not looking for a job. But somebody reached out to me and said, Hey, I see you posting all this stuff, because I was posting a lot of oncology content for my marketing purposes. And he said, I want you at my company, what kind of job do you want? Essentially, essentially built me a job. And I said, well, I’m building this business, I don’t want to work full time. And he said, fine. So I got a, I got a part-time job in in a digital health company, and did that for about a year and then actually got laid off from that. So it was a lot of tech layoffs at that time, which was just about a year ago. And so that’s how I came to work full-time in my business, which honestly was a great thing. Funnily enough, when I found it funny enough, when, when I got laid off, I called a couple of people that day. And, two of them said immediately, congratulations. I said, I’m not sure you’re supposed to say that when somebody gets laid off. But they knew I was building this business and they were like, you’re ready to just like try it out and see how it goes full time. So I have now been full time in my business for about a year. So you know, suffice to say this, the summary of that is that I didn’t I didn’t want to go full-time right away. Because one I didn’t know if it could support me from a revenue perspective, I wanted to be able to invest a lot of my, my revenue back in the business, and to have it grow. And so I did, I straddled two, two roles for gosh, three and a half years or so before I went full time.

Corrie Sanders  23:40

But I think it’s important to recognize that that’s maybe the best path for most pharmacists that are risk averse. I think there’s a lot of validity to you know, jumping off a cliff and investing in yourself and sinking or swimming to see if you survive. But ultimately, that can have a lot of dark ends if you haven’t really pivoted to a model, if you haven’t established proof of concept, if you don’t have the confidence in yourself yet that you’re going to be able to run whatever business it is. So I love that you straddled both. To be honest, it sounds like you really built up something that was manageable and workable and scalable during that time, while you were you know, had one foot in each camp. And then eventually, when you were congratulated for getting laid off from your job. You already had that experience. And you already had that model and you already had that confidence to move forward with your business. So I love that. And I think that that’s a great growth trajectory and maybe a more realistic growth trajectory for some of our more risk averse pharmacists. So Kelley, what resources outside of LinkedIn and we’ll get into LinkedIn in a little bit because I want to give you some time to talk about this platform that you love so much. But outside of LinkedIn, what resources did you use? Was there any tapping into a small business community in your area? Did you have any coaches? Did you really just boot strap this thing independently all by yourself, or were there some outside community entities that helped you better leverage your clinical skill set and set up a business model?

Kelley Carlstrom  25:10

Well, nothing is ever done by yourself. There’s always a huge team, whether they work for you or not, but there’s always people that you lean on. And so my initial resource was the Medi-preneurs Conference, which I went to back in 20, I think it was early 2019. And that’s where I kind of brought like a bunch of ideas I had, and the education business is what kind of, you know, took root, if you will, in some of the conversations that we had, and that that’s what I ran with after that. But I have a software idea, actually, when I first start when I thought that was going to be what I what I went with at the beginning. So that’s a great tool I did, I did use some of the Score, resources. So everybody probably has a Score chapter near them. This is I forget exactly what it stands for. But it’s essentially retired executives that are that help the small business community and it’s a free service in your local community. I also did work with a couple different business coaches. And you know, that’s a whole conversation in and of itself, too. I’ve worked with many different coaches over over the past couple years. But I did work with a couple in the beginning that kind of helped me get some traction helped me understand the basics. So you know, I knew nothing about running a business. So business coaches, at least got me a little bit on the right fit about the right foot about finding like product market fit and who my clients would be and how I would need to talk about it. I also listened to a ton of podcasts. So when I was traveling for consulting, I was I was on a plane, like a lot. Listen to tons and tons of podcasts. And honestly, most of them were way over my head. I remember listening and them talking about acronyms or saying words that I had no idea what they meant. And I just kept listening and kind of absorbing just kind of throughout osmosis. Honestly, like I wasn’t taking notes or anything, I was just listening and seeing what little nuggets I could catch on to what strings I could pull a little bit and learn a little bit more. I didn’t do a lot of reading of business books at that time. But that’s something I use now I listen to a lot of audiobooks or read business books, I have a long list and in my queue of anytime somebody recommends a book, I drop it in my queue whether or not I can get to it right away

Corrie Sanders  27:28

I do the exact same!

Kelley Carlstrom  27:30

You can only read so many at a time. But and honestly something that I think we don’t value enough in pharmacy or not, I guess not that we don’t value enough, but we don’t know enough about it our communities. So how can you find a group of like minded people that are working towards a similar goal, so you all can learn from each other. I’ve been in multiple different communities. And I would encourage pharmacists to look outside of pharmacy communities as well. Because pharmacy, although pharmacy entrepreneurs and pharmacy, pharmacist run businesses alike, depending on your business, if you’re selling, you know, like a service to anybody. But if you’re marketing to healthcare clinicians, I think it’s really easy to get in a silo and forget about some of the general business practices. And I’ve learned so much from just a communities of regular entrepreneurs, you know, often I’m the only pharmacist in those groups. Sometimes there’s other healthcare clinicians, but usually, most of them are not in healthcare. And I’ve learned a lot from them.

Corrie Sanders  28:37

And I think that that’s an important differentiation, too. So you’re still learning a lot, but your end user is a pharmacist. So you can ultimately relate because you guys are seeing practice through the same lens, you’re seeing your service and your products through the same lens. But I think that’s even more important if you’re selling to non-pharmacists, is embedding yourselves in these communities and learning how to speak business to people that aren’t pharmacists or just how to speak business in general, right, like, we, one, don’t sell ourselves appropriately, normally, for what we can do as pharmacists. But really having to see your business outside of that pharmacy lens is something that I think you’re alluding to, and then I certainly found very helpful is having that communication line and having that vernacular to be relatable to someone that doesn’t know anything about your profession for the most part. So Kelley, let’s talk about the LinkedIn community. Because you’ve mentioned that a couple times throughout our conversation already, I want to give you a chance to really explain how LinkedIn has shaped and changed the trajectory of your business and your personal development. And then let’s talk a little bit to about the elite community that you’re a part of in LinkedIn and how you got invited into that.

Kelley Carlstrom  29:45

Sure, yeah, LinkedIn is, I think people underestimate it because they don’t know what it’s about. You know, I remember when I first joined, which was back in 2014, early 2014. And I remember looking at the feed and thinking like, oh, okay, this is sort of like the Facebook feed. But I didn’t see anything particularly interesting. So I’m like, this is kind of boring. Why am I here? And the reason I didn’t see anything interesting is because I didn’t have a network that I was connected with. So LinkedIn didn’t know what information to share with me. So I think when the number one thing I would encourage pharmacists to do is to connect with people that are interesting to them, not just you know, other pharmacists, but sure, other pharmacists. But also people that are, you know, if you’re interested in the technology space, you know, connect with technology leaders connect with if you’re in managed care to connect with people, you know, that are in that space that talk about problems and solutions in that space, because that means your feed is going to be interesting to you. So once I’ve been building up my, my network, they’re on LinkedIn for many years, I started to get much more engaged, because I saw interesting things, I connected with interesting people. And again, that’s where I got recruited into that consulting role, actually, the consulting role in the digital health role. So I’ve always, I’ve always known that that’s where people find me. But the key is, you have to be active. And what I mean by active is, you have to log in pretty regularly. I always chuckle when I send people a message, and I get a response, like three months later. And they say, sorry, I don’t really log in that often. And I’m like, okay, that’s, that’s fine, if you would, if you don’t want to do that, but you’re not going to be able to use LinkedIn, for the way that it’s been intended to be used, which is to have you be seen, and for you to see others and you have to log in, and you have to engage pharmacists are not engagers. We, we are lurkers by default, and by lurkers. I mean, you read the content, but you don’t click the Like button, you don’t message people, you don’t write comments, just lurk on other people’s posts. And I know this to be true, because I go to conferences, and people say, Kelley, I love your content! And I have no idea who they are. Because they never put a comment, they never send me a message, they just lurk on my information, which is fine. I mean, it’s free content I’m putting out there, but you’re I just had a post this week or last week about it where you know, those that those that speak up, stand up, like they’re the ones that if you’re saying if you’re putting yourself out there, and you’re interacting, and you’re commenting that you’re gonna get more kind of recognition, more help, like people are much more likely to respond to a message and answer a question you have when you’re when you’ve already engaged with your content previously. So I think those are the those are the big things like login regularly and really engage, even if it puts you out of your comfort zone, which it will in the beginning. But but push yourself, push yourself, you know, you don’t have to write this huge diatribe. Just write you know, think about one sentence comment on somebody’s post that’s insightful or something from your experience that could help not only the person that posted it, but also somebody else that comes across that post, you know, hey, think about this perspective, or this is what I have seen in practice when I’ve seen this happen that that goes a long way on LinkedIn. So that’s how I’ve used it, I use it today. I do I post a lot of content. So I post Monday through Friday. For our aspiring pharmacy entrepreneurs, I would not recommend starting there. It is a lot. I worked my way up to that. I first started posting infrequently, then I was posting once a week, then twice a week, then three days a week. And then when I went full time last year, I started posting five days a week, but content creation is is a whole is a whole thing. It’s a whole beast. It takes a lot. It takes a lot of time and effort to do it. So don’t don’t start there. But that’s how I that’s how I present on LinkedIn. I also do a lot of outreach. I connect with a lot of pharmacists, both individual pharmacists working in oncology and not, I connect with other healthcare leaders. And I use it to help not only kind of pharmacists find my program, because that’s a marketing effort that I’m putting in. I want pharmacists working in oncology that are new to oncology to see my content and recognize that I can help them learn this complex specialty. But I’m also using it to spread the word about oncology pharmacists. You know, I get a lot of people that comment on my posts to say, Oh, I didn’t realize oncology pharmacists could do that. And that that’s kind of a much more broad profession expansion when when people outside of our profession start recognizing what we can do. So I enjoy having that impact as well and that comes with when you have the ability to reach more people. So that’s how I use LinkedIn kind of on the regular and then you mentioned the group I’m a part of, which is called LinkedIn Top Voices. And this is an invite program, an invite only program that LinkedIn extends to people that are that produce a lot of content that is helping users of LinkedIn. And so I was invited into this program in January of this year, which is super exciting. It’s pretty it’s it is like, I think less than .5% of LinkedIn users are in this program. And what I have learned, from I’ve actually learned a lot about LinkedIn from being in this program just a few months. And what I’ve learned is that they it’s different than other social media platforms, they want their users of the LinkedIn platform to get better. They’re invested in helping professionals get better at their jobs, learn and develop themselves as they want people on the platform that are sharing content, that will help the users do that. So that’s how I got invited because I share a lot of content that helps oncology pharmacists get better at their jobs and develop themselves.

Corrie Sanders  36:07

And it’s great to certainly be rewarded for putting so much time into the platform and effort and energy over the past 10 years. And again, that’s something that was not recognized overnight, you gradually worked your way up from just sporadically posting to a couple times a week to every day, Monday through Friday. So I think that’s something too, that maybe entrepreneurs will lean into LinkedIn very, very hard at the beginning of their journeys, or maybe there’s a maybe they actually don’t lean into it at all. But really realizing what you can do with that platform. If you use it to the maximum extent if you’re cultivating a feed that provides you a voice and provides you information that’s relevant to your business, or relevant to your specialty area. There’s certainly a learning curve with LinkedIn. And there’s certainly a way that you can make the platform much more valuable to you than I think the average pharmacist realizes. So that’s great to hear that you’re being rewarded for the time and the effort that you put into the platform too. So Kelley, let’s talk a little bit now about what oncology is going to look like in the future. You are in the depths of oncology, you are the oncology pharmacist, as you’re known on LinkedIn. So what do you see for oncology in the future? And what do you see the roles for pharmacy specifically in oncology, and the next couple of years? So specifically for this question, I’m thinking of pharmacists that may or may not know if they want to dabble in oncology, or maybe they were voluntold to now be a part of an oncology program. Like where do you think the trajectory of oncology and pharmacy and oncology is going?

Kelley Carlstrom  37:43

I like voluntold. I have a lot of clients that kind of fell into oncology. I actually didn’t like oncology at school. It was not where I expected to be. And I didn’t get into it until my grandmother developed leukemia when I was a P4 student on rotation. So there’s kind of two components of this question. I guess there’s like the, the what types of jobs will there be, and like the tactical pieces, and then the outlook of, you know, where’s oncology pharmacy going? So the outlook is, is that it’s growing? It, I mean, it’s really the best specialty if we think about it. Yes, I’m biased, but it’s totally the best specialty for many reasons. Because we have the most drugs approved, we have the most clinical trials, we have arguably the most expensive drugs. And that means that and the most complex drugs, which all means that the pharmacist has a really important role in helping manage costs and toxicities from all these drugs that are hitting the market. So there’s definitely going to be lots of drugs, lots of opportunities, lots of jobs in oncology. And the types of jobs that there are and will be, are pretty vast. I don’t think people recognize how many different types of opportunities there are. So certainly, there are many positions in patient care. And this is where a lot of the jobs are right now. And that is because we are having similar burnout issues in oncology pharmacy as the rest of the profession is having lots of our experienced staff are leaving clinical practice, which is a bummer. Honestly. I think it’s great for them, because everybody’s entitled to you know, do jobs that,  do work that fulfills them, but it’s also leaving a big gap in patient care. And even if we can fill that gap with bodies, which we do, and they are all like centers are almost always recruiting and hiring for oncology positions. What what the missing piece is that we’re losing people with experience. So when somebody with 15 plus years walks out the door and they hire somebody with a couple of years, even if they’re residency trained, that’s a big gap in knowledge and experience that’s leaving. So I think that’s that’s a challenge we’re all facing and in all the oncology conferences we’re talking about it ad nauseam, because we haven’t figured out how to stem this kind of bleeding, if you will. So there’s lots of opportunity in patient care both in community cancers, in academic centers, inpatient, outpatient, individual private practices, even though there’s not a ton of those around anymore, there still are plenty. There are also patient care roles or specialty pharmacies. So this is particularly good for pharmacists in the retail community setting that want to do something a little bit different. Specialty Pharmacy is an excellent transition. Actually just heard about an opportunity in California where they, they ideally want somebody with a retail background, who also has an interest in oncology. They’re willing to do training in oncology, because they have legal requirements where they need a pick to dispense oral drugs and this particular legal situation, but they’re dispensing oncology drugs. So they want that retail background, but you need some, you know, they’re, they’re dealing with these complex drugs. So there’s a lot of opportunities there, we’ve got opportunities in managed care and the payer space. So think about every time you send a prescription, and it needs a prior authorization, those people on the other end at the insurance company that are dealing with those prior authorizations, they often have very little oncology training, which is not fun for getting approved complex oncology drugs, because we’re talking to these people that don’t know anything about oncology. And they’re the ones that are saying yes or no. So those people need oncology training. And there’s, there’s lots almost every oncology drug I feel like needs a prior auth these days. So a lot, there’s a lot of opportunities in managed care. There are certainly jobs in pharma. As with every specialty. There are jobs in tech, like I said, I worked in on the tech side of oncology for many years. And there’s there’s becoming more and more kind of non-traditional roles, I do get a lot of people that reach out asking about remote oncology jobs. There is not a ton, but there are some, there are some at companies like McKesson, for example, where they do still have patient interaction, but they also they also get to, you know, have the flexibility that comes from from being in a remote in a remote position. So lots of opportunity, lots of different types of roles. Again, this is why oncology is the best specialty. Yeah,

Corrie Sanders  42:27

I mean, I think you nailed the, or you hit the nail on the head with the funds are there. Unfortunately, cancer diagnosis is increasing. So the diagnostic component is there. And it’s really just going to be a never ending game, it seems of filling positions for a growing specialty area. So like, as you said, I think there’s a ton of opportunity across various different continuums in the care spectrum, for for people to jump into oncology, even if they don’t necessarily have the experience. And I also love that you said that you didn’t like oncology in school, I’m sure a lot of people will relate to the fact that oncology is a beast of a module in school. And it’s very, very intimidating. So comforting to know that there’s people like you that are creating content and creating different products that people can buy to bridge that gap between what was taught in school and what’s needed in clinical practice. I think that’s such a beautiful business model. So looking at your business model, specifically, what’s in the future for you? It seems like right now you’re doing a lot of direct to consumer products and advertising. Is there any component of a business to business model moving forward? What do you think the evolution of your business is looking like over the next couple years?

Kelley Carlstrom  43:35

Yes, I would love to, to continue to work with institutions. So I have started working with some institutions that enroll their staff in my program. So that’s definitely a focus as well. And that’s because, you know, they’re hiring people without experience, but they also need them to do the job. And what I have found from all centers, I talked to this, they have a very good onboarding, technical process. You know, when somebody’s newly hired, they show you the EMR, they tell you the workflow, this is how, you know, this is how we do this thing here. Nobody gives clinical training. They kind of expect you to learn that on the job or on your own, which I’ll tell you doesn’t work. There’s there’s not enough hours in the day to do it at work. You get kind of the bare mitts sure you’ll get comfortable with some of the drugs, but you won’t understand breast cancer. You won’t understand, well, why is the doctor blowing through treatment parameters for this drug, but not this drug? Those are things you have to learn from a clinical perspective, from a disease perspective. And so institutions are recognizing that they need to support their staff better. And I’ll tell you the main reason is because turnover is expensive to them. You know, I don’t think we realize as pharmacists how much money it costs an institution when you leave. Not only do they have to pull another FTE to cover that that role that you’re leaving, which leaves a gap open somewhere else that and they have to do that for however long the hiring processes and right now the hiring process is long because everybody’s hiring oncology pharmacists and they can’t find people. But then they have to onboard that person. So it takes months for somebody to get up to speed. So it is a it’s like tens of thousands of dollars for people to, to for to recruit. So it is a huge cost savings to retain employees. That means keeping everybody happy. And and also potentially promoting from within. So I have centers that have pulled retail pharmacists, they have pulled ambulatory care pharmacists, which is a pretty good kind of matchup to oncology because they understand the am care space. And there’s actually a lot of internal medicine issues in primary care as well. And then, you know, they have to learn the oncology piece. So I think there’s a lot of financial benefit for institutions to train up their staff. So I look forward to working with with more of those. I’m always going to work with individual pharmacists, because that is honestly what fills my cup. Like there’s nothing, there’s no greater feeling than when a pharmacist reaches out to me and says, I passed the BCAP exam. Or I finally had a conversation with my doctor and didn’t feel like an idiot. Or I made a recommendation about this chemotherapy dosing and the doctor accepted it. Like, ah, those feelings just made me feel so good, because that’s what it’s all about at the end of the day. It’s not only that pharmacist’s gets that, that when and feels like they’re doing good work. But that patient is getting better care because their pharmacist feels more confident and is better educated, and I can’t ask for anything better than that.

Corrie Sanders  46:43

I hope that you can see the ripple effect that you’re creating by training these pharmacists. I mean, it’s I love that the pharmacist gratification fills your cup. But I really hope that you can see not only are you changing so many pharmacist’s lives with the business that you’ve created, but ultimately, the end user and the patient, you’re just improving care for so many more people than you could ever do alone. I love it. I love your business model. I think that it honestly could be applicable to some other specialty areas. For pharmacists that may not be an oncology, there’s certainly a way to leverage monetizing your clinical expertise in different ways and providing that to different pharmacists or other health care providers. I just think what you’ve done and what you’ve built is just something to be very proud of. So Kelley, I will end today with any advice that you would give to any budding pharmacy entrepreneurs, any lessons that you’ve learned along the way or anything that sticks out in your head that you’d like to convey to the listeners.

Kelley Carlstrom  47:39

Yeah, something that I consistently remind myself to do, which is take action. It really makes a bigger difference than then you think it will make. And I remember when I was in clinical practice, I had mentioned that I was risk averse. And for me how that played out was that I would research things to the Nth degree, you know. Whether it was a purchase I was making, whether it was a job decision, it took me months to take a consulting role, because I just kept making pro/con lists. And when I got into entrepreneurship, I realized like that that doesn’t fly, when you’re running a business, it just the time that you need to make decisions is very quick. And if you’re always second guessing yourself, it’s not you’re you’re not going to be successful. So what I would encourage people to do is have that experimenters mindset, which is I’m going to make a decision, I’m going to take some action on whatever this thing is I’m going to pull the trigger on trying out this piece of content or talking to this particular client or trying this new software tool, and then reevaluate it, like nothing is set in stone. So you can think about it a month later, six months later, and decide did that experiment work? Did that decision I made lead to anything to those clients, I was potential clients I was talking to actually buy for me? If a lot of them did great. That was a positive experiment. If they didn’t, no. That means, okay, I need to pivot and change course, it doesn’t mean it was a bad decision. There are no bad decisions in entrepreneurship. It’s just you have to get off of the table and start walking and start doing things. And that’s how you learn. I can’t tell you how many how many times I’ve done something where I’m like, Well, that was unexpected. And if it if it just took me, you know, if it took me months to make that decision, it would have taken me months to figure out that thing didn’t work or that thing didn’t work, you know, you got to make faster decisions in this world.

Corrie Sanders  49:33

And I really enjoy the experimenters mindset. I think that’s a great summary and a great way to put it and also just how you’re alluding to how we make decisions in clinical practice and how we might research decisions and how we might look into those things to the Nth degree. And maybe that shouldn’t necessarily carry over to your business mindset and how you’re running your business and entrepreneurship. Those are two very different, maybe the same skill set, but two very different applications with how you’re going to think about approaching those decision making processes and the time that you put into them. So I love that. I think that was wonderfully said. Well, Kelley, for the listeners that want to find you, they can obviously find you on LinkedIn. But is there any other way that people can find you, your website and I would love for you to also spell out your name to make sure that people get the spelling correctly. We’ll link to it in the show notes. But where else can our viewers and our listeners find you?

Kelley Carlstrom  50:26

Yeah, definitely LinkedIn. Send me a message there, please. And my website is KelleyCPharmD. So that’s Kelly, K-e-l-l-e-y C PharmD. C for my last name. Yes, my mom spelled my name that way. And I always have to spell it.

Corrie Sanders  50:44

Well, Kelley, thank you for your time. This was a wonderful conversation. I think there were a lot of great nuggets built into this conversation, a lot of great learning points that our listeners can take. So thank you again for your time. This was wonderful and we look forward to keeping pace with you and watching you as your business continues to develop.

Kelley Carlstrom  51:01

Thanks so much, I appreciate it.

[DISCLAIMER]

Tim Ulbrich  51:03

As we conclude this week’s podcast and important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding materials should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. Furthermore, the information contained in our archived newsletters, blog posts and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of Your Financial Pharmacist unless otherwise noted, and constitute judgments as of the dates published. Such information may contain forward looking statements that are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer. Thank you again for your support of the Your Financial Pharmacist podcast. Have a great rest of your week.

[END]

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YFP 351: Legacy Planning 101: How to Build Your Legacy Folder


Tim Ulbrich discusses the importance of creating a legacy folder to organize essential financial documents for access during emergencies and peace of mind.

Episode Summary

In this episode, YFP Founder and CEO, Tim Ulbrich, delves into the critical aspect of establishing a “legacy folder” to efficiently organize essential financial documents and accounts. This folder serves as a vital resource in emergencies, streamlining access for loved ones and averting confusion or delays. Drawing from personal experience, Ulbrich shares how he and his wife maintain their financial plan and essential documents in a shared electronic folder and a secure physical safe at home, ensuring accessibility and peace of mind during unforeseen circumstances.

Tim explores the contents of the legacy folder, which encompass a comprehensive checklist, electronic copies, and hard copies of vital papers such as birth certificates and social security cards and other critical documents like insurance policies and estate planning materials.

Learn how to proactively organize your financial affairs to safeguard against unforeseen events, ultimately fostering financial peace of mind and security.

About Today’s Guest

Tim Ulbrich is the Co-Founder and CEO of Your Financial Pharmacist. Founded in 2015, YFP is a fee-only financial planning firm and connects with the YFP community of 15,000+ pharmacy professionals via the Your Financial Pharmacist Podcast podcast, blog, website resources and speaking engagements. To date, YFP has partnered with 75+ organizations to provide personal finance education.

Tim received his Doctor of Pharmacy degree from Ohio Northern University and completed postgraduate residency training at The Ohio State University. He spent 9 years on faculty at Northeast Ohio Medical University prior to joining Ohio State University College of Pharmacy in 2019 as Clinical Professor and Director of the Master’s in Health-System Pharmacy Administration Program.

Tim is the host of the Your Financial Pharmacist Podcast which has more than 1 million downloads. Tim is also the co-author of Seven Figure Pharmacist: How to Maximize Your Income, Eliminate Debt and Create Wealth. Tim has presented to over 200 pharmacy associations, colleges, and groups on various personal finance topics including debt management, investing, retirement planning, and financial well-being.

Key Points from the Episode

  • Building a legacy folder for financial peace of mind. [0:00]
  • Creating a “legacy folder” for financial documents. [2:36]
  • Important documents, insurance policies, estate planning, and car titles. [6:50]
  • Organizing financial documents for emergency situations. [14:59]

Episode Highlights

“So when it comes to why having a legacy folder is important. Getting organized with your financial records plays a significant role not necessary in terms of moving the needle on your net worth but in making sure you and others have access to all the information that you need to make informed decisions.” – Tim Ulbrich [2:24]

“Now, what is the legacy folder? So essentially the idea of a legacy folder, whether it’s a physical copy and electronic copy, or combination of both. It’s a place where you have all of your financial related documents. So in the event of an emergency, others will be able to quickly assess your financial situation and get access to all of the documents and accounts that pertain to your finances.” – Tim Ulbrich [4:07]

“Don’t underestimate the peace of mind and the clarity that can come from having this information collected.” -Tim Ulbrich [5:25]

“Once you get organized with your information, you’re going to be walking from that point of confidence, you’re going to feel prepared in taking action on other parts of your financial plan.” – Tim Ulbrich [16:49]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRO]

Tim Ulbrich  00:00

Hey everybody, Tim Ulbrich here and thank you for listening to the YFP Podcast where each week we strive to inspire and encourage you on your path towards achieving financial freedom. This week I’m talking through Legacy Planning 101: How to Build your Legacy Folder and why it’s important. To assist with implementing this important step and your own financial plan, make sure to download the YFP Legacy Folder Checklist at yourfinancialpharmacist.com/legacy. This checklist includes a list of 15+ financial related documents that you can have a record of in your legacy folder. It helps you identify key parts of your financial plan that you may or may not have in place but need to get started. And it helps give you peace of mind knowing that in the event of an emergency, all of your financial documents are organized in in one location. Again, you can access that free checklist at yourfinancialpharmacist.com/legacy. 

Tim Ulbrich  00:51

Now before we jump into today’s episode, I have a hard truth for you to hear making a six figure income is not a financial plan. Yes, you’ve worked hard to get where you are today. Yes, you’re earning a good salary. But have you ever wondered, am I on track to retire? How do I prioritize and fund all these competing financial goals that I have? How do I plan financially for big upcoming life events? Whether that be moving, having a child, changing jobs, getting married or retiring? And why am I not as far along financially at this point in my career, as perhaps I thought I should be? The answer your six figure income is not a financial plan. As a pharmacist, you have an incredible tool in your toolbox your salary, but without a vision and a plan that good income will only go so far. That’s in part why we started Your Financial Pharmacists back in 2015. At YFP we support pharmacists at every stage of their career to take control of their finances reach their financial goals and build wealth through comprehensive fee only financial planning and tax planning. Our team of professionals including certified financial planners and a CPA, work with pharmacists all across the US and help our clients set their future selves up for success while living their rich life today. Ready to see how Your Financial Pharmacist can support you on your financial journey? The next step is to book a free discovery call with our team by visiting YFPplanning.com Again, that’s YFPplanning.com Alright, let’s jump in today’s episode.

Tim Ulbrich  02:18

Hi there, Tim Ulbrich here. Welcome to this week’s episode of the YFP Podcast. I’m flying solo this week to discuss legacy planning 101: how to build your legacy folder and why it’s important. Now this episode is going to be a brief one. But I hope you can walk away with a specific action item or to relate it to your own financial plan. Whether that be to create a legacy folder if you don’t already have one or if you do to make sure that you look at it and update that information if it’s been a while. So when it comes to why having a legacy folder is important. Getting organized with your financial records plays a significant role not necessary in terms of moving the needle on your net worth, but in making sure you and others have access to all the information that you need to make informed decisions. Think for a minute about all the various financial accounts, documents, records, insurance policies, tax returns that you have right, the list quickly grows to be one that is overwhelming. And the more you operate in your own system, the easier it is to navigate for you. But unfortunately harder for others to unravel, should they have to do so in the future. Right? Think of a situation where in the event of an emergency, you have this beautiful system you’ve created, you know where all your accounts are all your files, all your passwords, but unfortunately, others aren’t able to readily access that and to make sense of that information. 

That’s where the legacy folder concept comes in. I actually first heard of this idea, it’s not my idea, I first heard of it when taking Dave Ramsey’s Financial Peace University class, this was probably 15 years ago through our local church. And I remember walking away thinking, wow, that is so obvious, yet so important. And something that Jess and I hadn’t yet done at that point in our financial plan. Now, what is the legacy folder? so essentially the idea of a legacy folder, whether it’s a physical copy and electronic copy, or combination of both, which is what we have, and I’ll share more information about that. It’s a place where you have all of your financial related documents. So in the event of an emergency, others will be able to quickly assess your financial situation and get access to all of the documents and accounts that pertain to your finances. We just went through updating this – Jess and I did in our own financial plan, shifting everything to an electronic version with the exception of a couple things that we keep in a safe at home, so that in the event of something happening to Jess or I or both of us, those caring for our boys along with our financial planning team at YFP readily have access to all the necessary information that they would need. 

So when I think of the importance of this, you know, it really is peace of mind but there’s a secondary part that we often don’t think about, which is it forces you to get organized right? When you go through this process, and I’ll talk about the different sections of our own legacy folder. When you go through this process, you quickly might realize, wow, I’ve got some areas of the plan that I need to clean up, I need to gather some information. And this like many other parts of the financial plan, sure, it takes a little bit of time to get set up. But once you have it set up, right, we’re then in that update or maintenance mode. And again, don’t underestimate the peace of mind and the clarity that can come from having this information collected. So what’s included in the legacy folder? Well, I mentioned our checklist before and if you didn’t already download that make sure to download the YFP legacy folder checklist, you can access that again, at yourfinancialpharmacist.com/legacy that will give you a good guide. 

There’s no one right answer to this. So I’m going to talk through what we have in our legacy folder. And you can see maybe some of that makes sense. Or maybe you have other documents and sections that you would want to include. So here’s how we have it organized in a combination of a Google Drive a shared drive, and a safe at home with the password the master password to our One Password, which is the the password account that we use the password management account that we use, I have the master key password in a safe at home, along with some hard copies of some documents like birth certificate, social security card, etc. Those things are in the safe, everything else is stored electronically and anything that’s in the safe as referenced as such in the electronic documents so so keep that in mind to combination of an electronic folder we used to have this all in a paper copy it was in a blue folder, we used to joke with our my parents and our in laws that hey, if anything ever happens to Jess or I – get the blue folder! For obvious reasons, having everything in a hardcopy wasn’t ideal in terms of updating that as well as making sure that the integrity of documents stay in place. 

Okay, so section one is what we call important documents. Okay, so these are birth certificates for Jess, for me, for our four boys, these are our social security cards for us and the boys, this is our marriage certificate. These are our passports. And these components, we keep in a fireproof safe at home, obviously, because the hardcopy is important to have. So that’s section one important documents. 

Section two is insurance policies, and information. So this is something that we have to update. Some of these we have to update annually, others not so much. So for example, long term disability policies or term life policies unless something changes with those policies, you know, we’re not updating those on a regular basis. But this includes things like auto insurance policies, homeowners insurance policies, or umbrella insurance policy, or health insurance policies, long term disability insurance policies, and our term life insurance policies. And we have a couple of different term life policies and long term disability policies. So all of that is included here in section number two. Now, what I have done typically in the electronic version, is I’ll list these out. And then I have the the actual policy hyperlink. So it can be easily reference to get to the actual policy, right, whether that’s a term life, disability, or another type of insurance policy. So that’s section two insurance policies and information.

Section three is estate planning documents. So we have an electronic copy on the Google Drive folder, the shared folder, and then we have a hard copy of these as well, because of the wet signature that’s needed on these and each state is different. Ours is a wet signature with a note notarized copy. So we have a hard copy in the safe at home. So these include our revocable trust agreements, this is our healthcare power of attorney, this is our living will, our last will and testament, et cetera, a lot of work to be done here. Now, if you’re hearing those terms, and thinking, Wow, maybe I need to get my estate planning documents in place. We’re gonna be talking more about that on the podcast, but I would reference you back to Episode 222. We’ll link to that in the show notes, when we brought on a couple of attorneys to talk about why estate planning is such an important part of the financial plan, as well as Episode 310, when Tim Baker and I talked about dusting off the estate plan, so this is not a you set it and you’re done. 

Again, most of the work is upfront. Sure, there’s an investment of time and money to get these documents created. Again, the value is in the process of getting these created. And then you’ll have to update these periodically. So Jess and I often joke that our youngest son, Bennett, he wasn’t named individually in our documents when we created the so I guess that’s how it goes right when you’re the fourth son in the family. So he’s represented –  it does address future children. But it’s just funny that he’s not called out individually. So we’ve got some updating to do there. So that’s section three – estate planning documents. And again, we keep a hardcopy in the safe. And then we have an electronic version of that available as well. 

Section four is car titles. Now I’m not sure how valuable these are based on the current conditions of our minivan and our other vehicle, but, you know, calling these an asset would be a stretch but nonetheless, they have some value. Okay, so we have the car titles, readily available in section four so that someone could quickly sell or transfer the title of the car if need be. That’s section four car titles. 

Section five is all documents related to our homeownership, okay, this is the deed on our home. This is the HELOC that we have open in the event, essentially, we have this as a backup emergency fund or if we need to tap into some of the equity in the home. So this is the HELOC documents. This is another copy of our homeowners insurance just to have it all in one place as well. So any important document related to the home, obviously, information about the mortgage, all of that is here in Section Five. 

Section six is probably the biggest document I think, or close to the biggest section, which is a summary of all of our financial accounts. It’s our net worth tracking sheet, which I’ve talked about before on this show. And it’s all of our social security statements. Now I was just talking with a group of pharmacists last night that I was presenting to and I was talking about, hey, how many of you have pulled your Social Security statements to see your projected benefits, and I kind of got this impression that it was very few if any, right. So if you haven’t done that, it’s a good action step you’re going to do if you go to ssa.gov, to look at your Social Security statements, it’s got good information on there on projected benefits, and you can see your work credits. It’s pretty cool.

But this is a section where I have a table of contents that explains every account we have, right. So at Ally Bank, we have our high yield savings account, we have our checking account. Here’s where we have our Roth IRAs. Here’s where we have our 401 K’s. Here’s where we have a Roth 401 K. For every single financial account that we have, what is the account name? What is the institution? Where’s the link to that account? And what are we using that account for. And then as I mentioned before, we use One Password to store all of our password information and shared between Jess and I and the master key to that Password account is inside of our lock safe at home. So essentially, in the lock safe, you get to the One Password document through that you can then access all the individual financial accounts. 

Now I know I’ve talked about this before, but I really believe in the value and the importance of not only having a good idea of the summary of all of your accounts. But this is a good place to also be tracking your overall net worth and your trajectory of your financial health. Right net worth is your assets what you own minus your liabilities, what you owe. Tom Stanley talks about the importance of tracking your net worth in the book, The Millionaire Next Door, and he talks about those that develop and build wealth over time they think differently, right? What he’s talking about there is that they realized that their income is a good tool. But their income is only a tool if they’re applying that to building their assets and paying down their liabilities, which ultimately is translating into their net worth. 

So Jess, and I track our net worth on a monthly basis. It’s a very simple spreadsheet. If you want to see what that spreadsheet looks like I have that in the toolbox, yourfinancialpharmacist.com/toolbox along with a couple of the resources that I use, you can make a copy of that make it your own, very simple- every financial account we have, it’s the value of the asset. It’s the amount of liability assets minus liabilities we track that month over month, I think about that as the 20,000 foot view of kind of where we’re progressing financially, of course, the real work to be done is on a much more granular level. So that’s Section six, summary of financial accounts, net worth tracking sheet, and social security statements. 

Section seven is our tax returns, this is our tax returns. On the personal side, this is a tax returns on the business side. So for us that would be the business, Your Financial Pharmacist as well as the business YFP Tax. And then for the property that we own, we have a separate LLC for the property as well. So for any business filings or extensions, or important communications, documentations. Obviously, it’s important to retain your tax records for everyone. But here to have those readily available, as well whether it’s needed in the event of an emergency, or if you’re working with a tax professional or someone you need to reference that information that’s good to have. So that’s section seven tax returns. 

Section Eight is all information related to business records. So this is a summary of the business entities, I have a quick summary of what are the different entities and then of course, all of the legal documents, including the incorporation documents, the operating agreements, the buy/sell agreements, really important that you not only have these in place, but you have these readily available and accessible in the event of something happening. So any important document related to the business is there. And then as I mentioned, I kick off this section with a quick summary. So that in the event that someone needs to look at this, they can quickly understand what are the entities, what’s my ownership in the entities, and then what are the important documents within each entity that’s included in the legacy folder. 

Section nine is just a miscellaneous section. So this could be utilities information or other information that is not easily fit into one of the other buckets in the first eight sections. Pretty simple. Right? So yeah, it takes time. And I think even recently, when I went through a pretty major update of this, I want to say it took me you know, three, four or five hours just to update documents, things that I had to scan to get electronically and making sure I had the right setup, creating some of the explanation in the summary documents. But not only as I mentioned, is it helpful for whoever is looking at this information? Hopefully that never needs to happen. But it’s also helpful for you as you go through this to identify like, oh, maybe there’s some gaps in here in the financial plan that we could use as an opportunity to make some adjustments or changes as you’re looking at goals for the next year. 

So in terms of who has access to this, of course, Jess and I have access. Also, my in-laws have access to this who would in our state planning documents become the caregivers of our boys in the event of an emergency so important for them to have access and awareness of it, as well as our financial planning team at YFP right. So I know that in the tragic instance, if Jess and I were to get in an accident tomorrow, and something terrible would happen, I know that instantly my in-laws, who would be in charge of the boys and I know our financial planning team who would be helping them and making decisions, they have access to all of this information. Now, it doesn’t mean it’d be easy. There probably are still questions, maybe things that I’ve missed or haven’t thought about. But it’s a really, really good start again, gives us peace of mind knowing that we thought through this in great detail. 

So in closing, right, simple yet effective, simple, yet effective. And that’s so true for so much of the financial plan. Sometimes we overthink this, we overcomplicate this, yeah, there’s work to be done. There’s professionals to be hired, certainly on the financial planning side, on the estate planning side, on the tax side, but the gathering of documents and information. This seems like a bigger mountain to climb than it actually is. And I think for obvious reasons, right? Who likes to think about, you know, some of these circumstances that might be tragic, where someone would need to access your information. It also might expose areas of the plan really like ah, I don’t really like the progress that we’ve made, we’ve got opportunities to improve. So for those reasons, it seems like a bigger mountain to climb. But I promise you that as you go through the process, it likely is easier than you think. And once you get organized with your information, you’re gonna be walking from that point of confidence, you’re gonna feel prepared in taking action on other parts of your financial plan. If you have questions on this episode, as always, feel free to reach out to us [email protected]. Again, make sure to download the YFP Legacy Folder checklist. As you follow along in this episode, you can get that at yourfinancialpharmacist.com /legacy. Thanks so much for joining this week. We’ll catch you next week. Have a good one.

Tim Ulbrich  17:17

As we conclude this week’s podcast, an important reminder that the content on this show is provided for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding materials should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. Furthermore, the information contained in our archive newsletters, blog posts and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. opinions and analyses expressed herein are solely those of Your Financial Pharmacist unless otherwise noted and constitute judgments as of the dates published. Such information may contain forward looking statements, which are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer. Thank you again for your support of the Your Financial Pharmacist podcast. Have a great rest of your week.

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YFP 350: Monetizing Your Clinical Expertise with Dr. Gauthier (YFP Classic)


Tim Gauthier, PharmD, creator of two learning platforms shares advice for pharmacists seeking to monetize their clinical expertise. Episode sponsored by APhA.

Episode Summary

This week on the YFP Podcast, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, welcomes antimicrobial stewardship pharmacist and fellow pharmacy entrepreneur, Tim Gauthier. Tim is the creator of IDStewarship.com and LearnAntibiotics.com. During the show, Tim and Tim discuss the genesis for creating these two learning platforms, how Tim has monetized his clinical experience to create passive streams of income, and how he manages to stay consistent in entrepreneurship while balancing a full-time pharmacy career and fulfilling personal life.

Listeners will hear about Tim’s pathway to pharmacy, what drew him into the profession, his passion for infectious disease pharmacy, and what he was hoping to accomplish with his learning platforms, IDStwardship.com and LearnAntibiotics.com. Tim walks us through the content and resources available on his websites and how he has monetized them while providing a wealth of free content to his community.

Making things passive and generating passive revenue streams is crucial to Tim, and he shares the tools and systems he has put in place to make that goal possible while balancing other obligations. Tim also discusses the incredible value of community and how he has built an active, engaged pharmacists community that contributes to the platforms in multiple ways. Tim closes with advice for pharmacists looking to follow a similar path in monetizing their clinical expertise.

About Today’s Guest

Timothy P. Gauthier, Pharm.D., BCPS, BCIDP is a pharmacist trained in infectious diseases and antimicrobial stewardship. He is a clinician, researcher, educator, and author. He is an advocate for antimicrobial stewardship and pharmacy education.

Dr. Gauthier graduated from Northeastern University’s School of Pharmacy (Boston, MA) in 2008. He then completed a Post-Graduate Year-1 Pharmacy Practice Residency and a Post-Graduate Year-2 Infectious Diseases Pharmacy Residency at Jackson Memorial Hospital (Miami, FL). Since finishing terminal training he has worked in academia (Nova Southeastern University, 2010-2015), clinical practice (Miami Veterans Affairs Healthcare System, 2015-2019), and a leadership role (Baptist Health South Florida, 2019-current), all focusing on advancing the fields of infectious diseases pharmacy and antimicrobial stewardship.

He holds certifications from the Board of Pharmacy Specialties for Pharmacotherapy and Infectious diseases. He has completed the Making A Difference in Infectious Diseases Pharmacotherapy Antimicrobial Stewardship Training Program.

He is the creator and editor-in-chief of www.IDstewardship.com, www.LearnAntibiotics.com, and the many @IDstewardship social media profiles. He co-hosts the #ASPchat each month on Twitter. He reaches thousands of people each day on the internet and on social media, where he aims share reliable and relevant information from the world of pharmacy and healthcare in general. IDstewardship.com alone has registered over 5,00,000 page views as of November 2022.

Key Points from the Episode

  • The genesis for creating two learning platforms (IDStewardship.com and LearnAntibiotics.com)
  • How Dr. Gauthier has monetized his clinical expertise to create passive revenue streams
  • How Dr. Gauthier manages and leverages his time to be able to consistently put out good content while working full-time and fulfilling his personal commitments and goals

Episode Highlights

“So it’s been a really rewarding experience, and collaborating with others from around the world has been something an area of success, I think, to be part of kind of the community that I’ve built. But I have a lot of flexibility, and that’s one thing that a lot of organizations don’t have.” – Tim Gauthier

“But that’s what drives me because I just really am totally obsessed with infectious diseases and microbial stewardship, and I think people need help learning. I needed a lot of help learning. I see where there’s benefit. I see where there’s value. There’s some monetary benefit that comes with it. It’s not anything that’s extreme by any means. But by having that win-win, it’s really been something that I think has been worth pursuing.” – Tim Gauthier

“I think that’s kind of the most important thing I’ve learned when it comes to telling people you have something to share with them, showing them that it’s meaningful, getting them excited about it, showing them that you’re a reliable person that has the know-how to get them the resource that they need to succeed. That is really critical. So that’s kind of some of the messaging there.” – Tim Gauthier

Links Mentioned in Today’s Episode

Episode Transcript

[INTRO]

[00:00:00] T. ULBRICH: Hey, everybody. Tim Ulbrich here, and thank you for listening to the YFP Podcast, where each week we strive to inspire and encourage you on your path towards achieving financial freedom. 

This week, I had a chance to welcome antimicrobial stewardship pharmacist and fellow pharmacy entrepreneur, Tim Gauthier. Tim is the creator of IDStewardship.com and LearnAntibiotics.com. During the show, Tim and I talk about the genesis for creating these two learning platforms, how Tim has monetized his clinical expertise, and how he manages and leverages his time to be able to consistently put out good content while working full-time and fulfilling his personal commitments and goals.

Before we jump into the show, I recognize that many listeners may not be aware of what the team at YFP Planning does in working one-on-one with more than 250 households in 40-plus states. YFP Planning offers fee-only high-touch financial planning that is customized for the pharmacy professional. If you’re interested in learning more about how working one-on-one with a certified financial planner may help you achieve your financial goals, you can book a free discovery call at yfpplanning.com. Whether or not YFP Planning’s financial planning services are a good fit for you, know that we appreciate your support of this podcast and our mission to help pharmacists achieve financial freedom. 

All right, let’s jump into my interview with pharmacist and entrepreneur, Tim Gauthier. 

[INTERVIEW]

[00:01:21] T. ULBRICH: Tim, welcome to the show.

[00:01:23] T. GAUTHIER: Hey, thanks for having me. I’m really excited to be here. How are you, Tim?

[00:01:26] T. ULBRICH: I’m well. I’m excited to dig into the work that you’re doing and for you to share with the YFP community how you’ve been monetizing your clinical expertise. But before we jump into that, I’d love to learn about your journey into pharmacy school, into the profession, where you went to school, when you graduated, and what drew you into the profession of pharmacy.

[00:01:44] T. GAUTHIER: Oh, yeah, of course. So I went to Northeastern University in Boston, Massachusetts and graduated in 2008, which feels like yesterday, but it’s been four years now. I got into pharmacy because I really was interested in microbiology. It turns out it’s easier to transfer into microbiology from pharmacy than pharmacy to microbiology. So I started in pharmacy. I ended up sticking with it. I never thought I’d go into infectious diseases pharmacy, just because it didn’t really cross my mind, and I didn’t know much about that early in my years. 

Then later on, after PGY1, I had the opportunity to do a PGY2 in ID. Lo and behold, today, I’m an infectious diseases-obsessed pharmacist, who’s out there to defend antibiotics and promote clinical pharmacy. So here we are today.

[00:02:27] T. ULBRICH: So the Northeast, Tim, to Florida. This is the time of year in the Northeast. I grew up in the Buffalo area, where it’s beautiful. I always say six months out of the year, I’d live anywhere else. But the Midwest I’m at now or the Northeast. But the other six months, included this time of year, is absolutely gorgeous. So do you miss the seasons at all?

[00:02:49] T. GAUTHIER: I do miss the seasons, but the winter in Miami, Florida, where I live now, is just absolutely wonderful. I love the culture, as well as all the different types of food here. We do visit. Periodically, I go to Boston, Rhode Island, Connecticut and stuff. So it’s nice to be able to have a little bit of the best of both worlds.

[00:03:06] T. ULBRICH: Yeah, yeah. So we connected several years back, and I’ve been following your work for some time. I wanted to bring you out in the show, as I think what you’ve built is a really cool example of how pharmacists can monetize their clinical expertise. Certainly, as we’ll talk about, it’s not just about the money, but it’s being able to leverage the skills, the passion, the interest that you have to fill a gap in the market and to help people looking to learn more about a topic. 

Here, we’re going to be talking about infectious disease, of course, and we have featured a variety of individuals on the podcasts over the past year or so. So I’m excited to share your journey as well. So let’s start with IDStewardship.com. When and why did you start it? Who was it for? What were you hoping to accomplish? 

[00:03:49] T. GAUTHIER: Yeah. So IDStewardship.com has been alive since about 2016, and I just had a friend who knew how to build websites, and I wanted to build something on my own, and he offered to help and put it together. Then I kind of took off from there, and I do pretty much everything on my own now. When I have a technical problem, he comes in? But why did I do it? There’s a couple of reasons. 

One is I wanted to own my own space on the Internet, where I could have a voice, where I could publish things and not be restricted by a company or a manager or a group of people. Also, I just really enjoy your writing. So it gave me an opportunity to use a different part of my brain on the weekends and in the evening hours to share information that could be open access and someone else could benefit from. There’s a huge need in pharmacy. It has been for us to share our experiences and practical advice and insights so that others can learn and grow from it. 

Also, just sharing information about antibiotics to make it easier for people to understand what drugs can I use for MRSA or Pseudomonas. But then some deeper things like what are five things to know about, I don’t know, Stenotrophomonas or Acinetobacter. So really, it’s just a myriad of content these days. If you’re a pharmacy professional, if you’re a healthcare professional, there’s some stuff on there that you’ll be interested in. If you’re just looking for fun stuff, there’s a drug name emoji that people really, really seem to enjoy. 

[00:05:03] T. ULBRICH: So I’m trying to understand, Tim, the need you’re filling with this resource. So obviously, we all went through ID curriculums in our PharmD program. There are there are PGY2 residencies that focus on this fellowships who focus on this. Certainly, there are associations or interest groups within associations that focus on this. So what is different here that you’re trying to carve out to fill a need that you felt like either wasn’t being met for you or for other clinicians through those other learning pathways?

[00:05:32] T. GAUTHIER: Yeah. I didn’t do very well in ID in pharmacy school, ironically, and I didn’t feel comfortable with it until I was like halfway through my PGY2. Practical resources that are available that are insightful and that consider the things that are beyond just the obvious, those were lacking. That really motivated me to try to put out things that were interesting. But also, like when you go to practice, these are five things you need to know about [inaudible 00:05:55] come across [inaudible 00:05:57]. I think that the community has received it really well, but I use social media to amplify that voice in different social media platforms. 

So it’s been a really rewarding experience, and collaborating with others from around the world has been something an area of success, I think, to be part of kind of the community that I’ve built. But I have a lot of flexibility, and that’s one thing that a lot of organizations don’t have.

[00:06:21] T. ULBRICH: Yes, yeah. The digestible nature of the content strikes me. You’ve alluded to it a couple of times with examples you’ve given thus far in the show. It reminds me of one of the pharmacist we’ve had on this show, Kelley Carlstrom, on episode 217. Her business called KelleyCPharmD. She does an awesome job of this in the pharmacy space, specifically in oncology practice, making it accessible, no matter where you are. She trained at the Cleveland Clinic, an internationally recognized institution. Not everyone can go do your residency there, right? Has the time to commit, potentially has to travel to do that. 

Her vision really is what about all the other hospitals? What about all the rural healthcare settings that are trying to treat patients and get their clinical staff up to speed? Or perhaps different practice models that don’t have a lineup of board certified residency trained pharmacists with multiple credentials? How can we expand the accessibility of this content? That’s one of things I love about what you’re doing here, and it really does strike me as being much more accessible than what is out there and some more traditional training programs or those that are offered by other groups. 

It’s also written and presented in a way that is easy to understand. It’s relevant. It’s things that, Tim, you’re experiencing daily as a clinician yourself or encounters when you’re precepting residents or students. So you know the pain points. You know the questions, the problems, the points of confusion because you’re living them each day. I love the platform of what you built to address that. 

So take us, Tim, through IDStewardship.com, in terms of the content you have, the resources you offer, and how you’ve been able to monetize it, right? You give out a lot of great content for free. But you also been able to monetize the site and enable to reap some of the fruit for all the work that you’re putting in, and you’ve put in over the last seven years. So talk to us about what you offer and provide on the site and how you’ve been able to monetize that.

[00:08:14] T. GAUTHIER: Yeah. I offered way too much stuff for free, probably. But exactly like an altruistic passion project, it has to make some kind of money for my wife to allow me to continue it. So definitely, it’s a mixed bag. But the art of the IDStewardship.com offers articles, which are blog articles talking about the student experience, the pharmacist experience, clinical insights into common questions that we ask and that we see. Those are always written by content experts who have practical experience in the area, and I vet all that content to make sure it’s reliable, credible, and it goes beyond like the obvious content that you might find in a general article. 

Also, there’s a study guide section, which is free and open access that has a picture of the drug, some of my key points, which I think you might find on your pharmacy school exams or maybe the BCPS or BCIDP exam and then links to some of the articles or some of the guidelines that are really relevant to that drug. I have a list of resources, which is pretty cool. If you’re looking for anything about antibiotics, that is a very robust list of resources. So like hepatitis C screening for Child-Pugh score. There’s a calculator in there. Just pick one random example. Or even if you’re looking for regulatory content from the Joint Commission, it’s linked there. 

I also have the contributor section, where you can see who’s participated, and there’s really a lot of contributors to my website. So I do want to emphasize that that’s a really cool part of what I’ve been able to do, and it’s not just Tim doing it. It’s the community. But I kind of lead it because I’m kind of like the editor in chief of the content founder. The other part, though, which I really want to talk about for a second is LearnAntibiotics.com. So I’ve taken the opportunity to show people that, yes, these are articles that are available. But I’ve been able to produce content that you can use for learning. As a background in academia, I know that you have to go and be able to identify and define before you can analyze and assess and predict. 

So I’ve built content specifically to help people through that learning process. If you’re looking to identify and define, I have cheat sheets on different disease states, on different drug classes. Those can help people to say, okay, like, “Pseudomonas drugs, these are my drugs.” But then I also make more fun content that has like a word search or a Jeopardy game. Those can be applied to the specific area. Then the practice tests I’ve built so that if you are able to pass that practice test, you can practice pretty competently as a pharmacist and know what questions to ask for infectious diseases and even some of them I’ll give you. Here’s the question, here’s the answer, and here’s the rationale for why each answer is right, and each answer is wrong. So it’s pretty robust. 

[00:10:59] T. ULBRICH: I love that and I want to come back in a little bit to talk more about the LearnAntibiotics.com, in terms of what you’re trying to accomplish there. I think that’s going to give some folks some interesting ideas about as you’re considering monetizing your clinical expertise, there’s a lot of different ways to do that. I love what you’ve built there with that membership type of model. 

Two words, Tim, that really stand out about what you’ve built and the vision that you have going forward are passion and community. You mentioned community just a moment ago, and I love that you’ve brought together a group of people that are, obviously, passionate about learning more about antimicrobial stewardship, learning more about infectious disease, bringing in contributors to the site, taking them from just a passive learner, to engaging them in the conversation, contributing to the community, and then passion. Your passion for this topic and furthering individuals’ knowledge and, obviously, the more our healthcare professionals know about this topic, the better they’re able to serve their patients. 

I think this is so important for folks to hear, when you’re working on a side hustle or a business, especially when you’re working a full-time job, you have lots of other commitments, doing something that you’re passionate about, you mentioned that I probably got too much free content out there, right? It’s a passion project for you. Yes, you’re monetizing it. But that is going to really drive the energy and the enthusiasm to continue to build, especially in the early years, as someone who’s trying to get something off the ground. 

Tim, as people go to IDStewardship.com and they see what you’ve built over several years, how much of this is what you have built and maintained? And how much of this is what you have other people that are helping you in building and maintaining the site?

[00:12:36] T. GAUTHIER: That’s a great question, and it’s definitely changed over time. When I started to look at developing a website, I talked to one of my friends who’s in website development, and he said, “Tim, we can do a website. But this is not a six-month thing, and this is not a one-year thing. This is like a 10-year journey, and you have to think of it very long-term.” So taking small bites has been one of the keys to success. As I’ve understood the workflows on developing different items, it’s gotten to be more efficient over time. I do produce actually the majority of the content on my own when it comes to the background work. 

But the one thing that people send to the community of pharmacists, they’re willing to be a part of this journey. Them sending me articles and communicating with me and offering their assistance and trying to get their message out and share their passion, that really has enabled me to produce more content and put more information out there. But it is a tremendous amount of work. I do spend a lot of time between the hours of 8:00 PM and 11:00 PM working on this type of stuff. I think if you don’t have the passion for it, it’s probably going to be hard to do it long term. 

But that’s what drives me because I just really am totally obsessed with infectious diseases and microbial stewardship, and I think people need help learning. I needed a lot of help learning. I see where there’s benefit. I see where there’s value. There’s some monetary benefit that comes with it. It’s not anything that’s extreme by any means. But by having that win-win, it’s really been something that I think has been worth pursuing. 

One of the secrets that they say is not to do things alone, right? If you’re going to build a program like this, or you’re going to build a side business. I have mixed feelings about that. On one hand, I love the freedom that I have. I have total creative freedom to do whatever I want, whenever I want, with no one arguing with me. But at the same time, being in an echo chamber with yourself is not always a positive thing, and having a partner can push you in good directions. So I think partnerships are important, and you can choose to pursue things as a partnership or as an individual. 

Something else I want to note that as I built out what I have online with IDStewardship is I’ve really purposely tried to make it about the brand and not about me. That kind of protects me in a way because the voice is the voice of the brand and not the voice of the individual. Also, people can engage within behind that brand and be a part of the community again, rather than it being part of what Tim is doing. So that was actually very strategic in the development. 

[00:15:02] T. ULBRICH: Yeah, Tim. I think that’s a strategic move for the reason you mentioned also. I think about the passion and the mission of what you’re trying to do. Like there may be a day where maybe this isn’t only Tim who’s doing this. Or for whatever reason, you have others that are involved in the mission of advancing the education around IDStewardship and being able to have this information accessible, where folks can learn and perhaps be excited about learning it I think transcends just one person, right? So I think the contributors is another important aspect here of what you’ve highlighted.

[00:15:34] T. GAUTHIER: Like making things passive is also really important to me. I’ve learned that a lot during COVID because COVID has been absolutely horrible for all infectious diseases pharmacists and time management and when life was balanced. I mean, everybody in general. But I mean, trying to keep up with the literature and be engaged, on top of having this site and stuff going on, I need things to be able to put on pause, right? If I have no commitments that I’ve made, that’s not going to serve me well in the long term. So I really try to do things that are passive whenever possible and then only commit to like a couple of things at a time.

[00:16:05] T. ULBRICH: Yeah. One other thing I was thinking about, Tim, as I was looking at your site, that would be I think good advice for folks that are thinking about building their own, especially if they don’t have a huge budget upfront to be able to hire a web developer. If you’re building a content-based site, it could be blog articles that you’re adding, podcasts that you’re adding, e-resources that you’re adding checklists, guides, e-books, whatever, like you want to make sure you’re building it in a way that you understand and can add to it on a regular basis. 

So even if you’re working with a developer or a contractor to help you, making sure you have enough understanding of the back end so that you’re not spending a whole lot of money long-term or frustrated that each time you’re trying to add a piece of content to the site, whether that’s a blog, podcast, an opt-in guide, whatever be the case, that you want to be able to have something that’s nimble, and you can add to over time. 

[00:16:51] T. GAUTHIER: I’ve seen some people who built 20,000, 25,000-dollar websites, and they tend to be the people that follow a lot of podcasters in the space of like social media and engagement and business development. So I think if you’re committed to it, it can be worth the money. But you got to proceed with caution.

[00:17:10] T. ULBRICH: When I go to the site, Tim, and you mentioned already that LearnAantibiotics.com, www.learnantibiotics.com, we’ll link to that in the show notes, which takes you over to the IDStewardship site, that really is the membership portion of the site, where folks can be engaging with the community on an ongoing basis. Obviously, the goal there is that becomes some stability of recurring revenue that supports a lot of the time and effort and the free content that you’re putting out there. 

Talk to us about – I think in content marketing, and I hesitate to use that word because I feel like you’re leading with such good passion and education that sometimes that word can sound dirty. But ultimately, the value that you’re providing and really good free rich education is naturally going to make people aware of what you’re doing on the membership side, which has a recurring revenue potential. 

So what has your strategy or approach been to connect the free content with the membership model? Is it just that, hey, more eyeballs on the site and value that they’ll kind of find their way over there? Is it opt-ins that then point people to that resource? Tell us more about the strategy that you’ve employed to connect the free education people are viewing and receiving with some of the paid options you have. 

[00:18:24] T. GAUTHIER: For sure. As you’re saying, this, I’m thinking about how I need to be more strategic. Sometimes, just go with the flow. That feels good. That feels good. Sometimes, I think of things, and I’m like, “Oh, I wish I had done that.” Even right now, there’s a list of things that if I had the time in my life to do, I would totally do. 

But in general, what I try to do is capture a large audience and engage a large audience and do that through all these different ways that I think of, whether it’s something that’s like a clickable link on an Instagram story, or it’s a new blog post that I put out, or it’s putting a meme out there or just sharing like, “Hey, here’s like a part of my cheat sheet. If you’d like to see more of it like, shoot me your email address. I’ll shoot you a copy of this cheat sheet in full.” Then I have a way to communicate with those individuals. So if you’re just interested in the LearnAntibotics site or you’re interested in like all of IDStewardship, and you want to get our monthly newsletter, I’m able to reach you that way.

Another thing that’s important about having a mail listing is that if like tomorrow, Instagram decides to just delete my account, which they can’t, I have nothing. I’m left with nothing. Whereas since I have a Mailchimp account, they’re able to house my ability to communicate with my people. So in general, I provide something for free. I get the ability to contact these people. If you want to unsubscribe, I have no problem with that. Actually, when people unsubscribe, I don’t have to pay for you to be on my listserv anymore. I actually don’t mind at all. So if you don’t look at the newsletters we send out, feel free to unsubscribe. But if you want to subscribe, then we’d love to communicate with you. 

I think that’s kind of the most important thing I’ve learned when it comes to telling people you have something to share with them, showing them that it’s meaningful, getting them excited about it, showing them that you’re a reliable person that has the know-how to get them the resource that they need to succeed. That is really critical. So that’s kind of some of the messaging there. 

[00:20:18] T. ULBRICH: Yeah. I think one of the other things you’ve done really well, Tim, that I admire is you’re consistent in your content. We know and we’ll talk in a moment about how you balance time with other personal responsibilities. None of us are perfect and consistent in delivering the same amount of material, but you’ve been consistent over the years in terms of there’s not months and months of like quiet phases, and then you dump a bunch of content. 

I think that’s so important for any – If we think about communities we like to be a part of or content we like to follow, it’s a consistent offering that we’re engaging with that content. So as you’re getting started, as someone’s getting started, I think thinking about what is – Once you decide on the medium, is it a blog, is it a podcast, whatever you’re looking at, is it something like a vlog, what is going to be your rhythm roughly that you’re going to be delivering content and making sure you’re showing up on a consistent basis with your audience and those that are finding value from what you’re doing?

[00:21:10] T. GAUTHIER: Along those lines, I think listening to your community is important. I had someone email me recently and say, “Hey, Tim. I wish you had a malaria cheat sheet because I’m studying for the BCIDP exam or the BCPS exam,” I forget which. I made one that weekend, and I really enjoyed it. I thought it was super interesting. I learned a bunch about malaria. So not only does it like help people advance their professional goals. It helps me remember things. I use my websites all the time to remember some of these nuances that are details that are just – You can’t remember everything.

[00:21:40] T. ULBRICH: That’s where I think the community piece comes in well too. You’ve got a good social media following. I’m sure people reach out to your questions all the time. You have students on rotation. You start to put some of those repeated questions into content buckets, right? I know you have a list of running content ideas. I’m sure you do. But once you hear a question more than one, two, or three times, it’s like, all right, maybe there’s something here in terms of a piece of content that we should be putting out. 

Let’s talk about time and balancing doing this. You’ve certainly made a strong case that there’s a lot of passion behind it. But nonetheless, like you’ve got a family. You’re working a full-time job. You’re precepting residents, students. You have expectations at home and at work. Like what strategies have you employed time blocking, or how have you been able to really leverage time so that you can continue to put out content on a consistent basis while working full-time?

[00:22:31] T. GAUTHIER: Yeah. Well, in the early days, and I was working at the Veterans Affairs Hospital in Miami, and they’re very strict in terms of their hours. So when you’re off duty, you’re off time. So everything that I did in the beginning was during off hours. That’s still the same today, but it taught me that you should only work on these things when you’re not on company resources, etc. 

But then I didn’t have small children in the early days, which meant I have had a lot more time, especially in the evening areas of the day. More recently, I have a three-year-old and a seven-year-old, and the evening hours are much more strenuous. So now, since we’ve developed more of an awareness in the community about IDStewardship, I reach out to people. When I see an article posted on like Twitter about something new that I’m interested in, I’ll reach out to the person who authored the article and say, “Hey, I’d love to have you write five things to know about whatever the topic is.” 

People almost always say yes because they want to share their passion. But it’s not just about me getting content. They now have a way to share that information. Sometimes, it’s the resident or the student or the second or third author that I work with. So they get an opportunity to share their voice. Coming up with strategies where I don’t have to do all the work has been one thing. Then also, like when you look at the development of like research and scholarly work in an academic position, you kind of look at it like a conveyor belt, and you want projects in all areas of your conveyor belt. 

Some things are in – You’re designing. What do you think it might look like, and you have your concepts, your list of projects? Then other things are going into publication, going out on the newsletter. So you’re constantly just like feeding that conveyor belt and keeping it going in different areas, and that’s how you stay productive over a long period of time. It’s not about taking one thing and rushing it forward but just maintaining that conveyor belt. There might be different conveyor belts that go faster or slower, and some things might take two years to do. 

But I always move forward with projects based upon what I think is like fun and interesting, and I don’t put pressure on people. I’m not out there saying, “Hey, if you don’t get back to me in two weeks, you’re not going to be allowed to do this.” If you don’t feel like doing this later because you have a problem, whatever. Don’t do it. If you want to circle back in two years, circle back into years, like no pressure.

[00:24:39] T. ULBRICH: Take us a little bit behind the scenes. I think one of the barriers that folks run into is they’re just trying to get started, and they go to someone’s site. They don’t necessarily have a picture of what are some of the tools and the systems and the processes that you have in place. You’ve mentioned a couple things already. Obviously, you’ve got the website infrastructure. You mentioned the email list. So like for us, we use WordPress for our website build. We use Bluehost for our domain hosting. We use ActiveCampaign for our email marketing. Then we have several other tools we use for project management and other things. 

So what are some of the tools that you use or that you have found to be helpful as you’ve been working on IDStewardship?

[00:25:18] T. GAUTHIER: Yeah, for sure. I use WordPress, and then I use WPX Hosting. Then for like the memberships, it’s PMPro or Paid Memberships Pro. I’ve been pretty happy with those overall. The WordPress in particular, it’s just overall really easy to use. You add a plug in. It updates. It’s no big deal. WPX is really – Once a year, I pay a fee. Once in a while, I’ll have a bandwidth issue. So I’ve learned that I need to downsize the images that I use when I post, which I think a lot of people kind of learn that lesson. 

I mean, that’s really the gist of it. Outside that, I use Mailchimp for my emails. I don’t really love how much they charge. I think they’re charging me like 250 a month for like 25,000 subscribers. So it’s great to have that many subscribers, but it doesn’t feel good paying $2,500 a year for that. But it also motivates me to put out content to use that tool that I’m paying for. So those are some of the key things that I’m using now. 

Otherwise, I just maintained like Excel sheets for a while. In the beginning, when I didn’t have as much content, I would do a lineup, and I would remind myself of when I posted to Facebook about a specific blog post, and I would just keep cycling through them. So I was always posting like one thing a day on Facebook. But it’s gotten to the point that I can’t do that anymore. I’d need to hire like a social media manager or something like that. I think as you grow, you need to start considering how can you work with who can you bring in. 

Another thing is as I’ve kind of met people in life through my way or through other venues, I work with them. So I just met a guy over the weekend that he prints things for a living, right? So there’s so much opportunity for us to collaborate with printing things. My audience is interested in topics of pharmacy and infectious diseases. So being entrepreneurial is one of the definitely keys to success here and also not being stuck in your ways, being able to evaluate things, and then accept feedback. If it’s not going well and someone tells you it’s not going well, take that advice and see how you can make it better and ask them, “Hey, how can I make this better?”

[00:27:13] T. ULBRICH: Yes, great advice, Tim. I think for people that are listening, and they hear 25,000 people on an email list and again not getting paralyzed from Jump Street. I think I love what you shared of it was a spreadsheet to begin with, right? I’ve shared before on this podcast that the first 100 subscribers on our email list were a combination of text messages and Facebook messages and LinkedIn posts that I had, and that eventually got added to an email software. Eventually, we added automations. Eventually, we added opt-in funnels and all those things, project management, social media management tools, things like that. But just getting started, you can do a lot of that manually. Get some of the things off the ground. Then as you get momentum, you can build out the systems and the processes that will help with efficiencies. 

Tim, if someone is listening and they are on the very front end of this, so let’s just pick another specialty that’s out there, and they’re thinking, “I’d love to build something in this domain, similar to what I see Tim doing with IDStewardship, Kelley doing with oncology. I also think about what Jimmy Pruitt’s doing with acute care out there in pharmacy,” like what advice would you have with them at the very beginning of their journey? If you think back to where you were when you started in 2015, like now looking back seven years later, like what piece of advice would you have to share with them as they get started on this journey?

[00:28:33] T. GAUTHIER: Well, I mean, first of all, not just because I – If I say something, it doesn’t mean it’s necessarily true. So it’s just my opinion on some of this. So feel free to disagree. But one thing I feel is that, especially when it comes to social media, people go on Twitter, on TikTok, on Facebook because they’re looking for things for themselves. So if you’re not putting out things that are going to be interesting to your audience, then your audience is not going to grow like they should. 

So everything that you do, no matter what you’re doing, should be aligned with why your audience is going to that area, and that’s going to help to get them to like it, get them to share it, which is very, very difficult in the pharmacy profession. We’re like 90% passive users. We love to learn. 

[00:29:11] T. ULBRICH: That’s right. 

[00:29:13] T. GAUTHIER: I’ll post something on Facebook, man, and it’s like five likes. But then I’ll see that I got 250 link clicks. So it’s very interesting. From an outside, you might look at my Facebook page or something and say, “Oh, I got a couple of likes or clicks,” and you can’t see the clicks, but you’ll only see a couple of likes, and they got lots of clicks. So it’s kind of one thing that’s important, I think, as you’re starting off. 

Another thing about starting off would probably be considered like long-term how you’re going to grow, and you’re talking about the design of your product. I think that core message and that core what am I doing here is really important. Over time, is that going to change? Because if it’s focused on something that’s relevant now like COVID, for example, or moneypox, maybe that’s not relevant in two years from now.

[00:29:59] T. ULBRICH: It’s pretty cool. Yep, absolutely. That’s great stuff, Tim. I’m excited for our listeners, if they’re not already aware to follow the journey, and I hope they’ll opt in your newsletter. Where is the best place that folks can go to follow you and the journey and the work that you’re doing?

[00:30:16] T. GAUTHIER: Yeah. I mean, definitely IDStewardship.com, and you can sign up for our newsletter there or just follow along on Instagram or our Facebook or goods areas. Twitter, you can find me there as well. It’s a little bit more focused on infectious diseases and as a whole and staying up with the literature on Twitter. So either of those but the newsletters are really a good place to start.

[00:30:37] T. ULBRICH: Awesome. Thanks, Tim. Appreciate you taking time to come on the show.

[00:30:39] T. GAUTHIER: Oh, it was my pleasure. We’ve worked together for so long over the years. It’s really a wonderful opportunity for me, and I appreciate your time.

[00:30:46] T. ULBRICH: Thank you. 

[END OF INTERVIEW]

[00:30:47] T. ULBRICH: As we conclude this week’s podcast, an important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding materials should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. 

Furthermore, the information contained in our archived newsletters, blog posts, and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of Your Financial Pharmacist, unless otherwise noted, and constitute judgments as of the dates published. Such information may contain forward-looking statements that are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward-looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer. 

Thank you, again, for your support of the Your Financial Pharmacist Podcast. Have a great rest of your week. 

[END]

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YFP 349: Your Top 3 Questions Answered by a CERTIFIED FINANCIAL PLANNER™


YFP’s Tim Baker addresses key questions from the community, covering retirement savings, cost of living, and the importance of the nest egg calculation.

Episode Summary

On this week’s episode of the YFP Podcast, host Tim Ulbrich is joined by YFP Co-Founder and Certified Financial Planner, Tim Baker, to dive into some of the most common questions from the YFP community. He covers topics ranging from debt repayment to investing and retirement planning in three key questions:

  • How much do I need to save in order to retire? How do I determine what is enough?
  • The intricacies of cost of living and understanding the income you’ll have in retirement.
  • Why the nest egg calculation is crucial in financial planning.

Our discussion also delves into the pros and cons of paying off low-interest debt, such as student and auto loans, versus investing. Tim Baker also shares the strategies for prioritizing debt repayment, retirement savings, and saving for a house down payment.

In a particularly insightful segment, Tim and Tim tackle a question from a listener with a $200,000 student loan balance, where Public Service Loan Forgiveness (PSLF) isn’t an option. Tim Baker shares his perspective on weighing the decision between paying off the loans and pursuing forgiveness over 20-25 years, including the potential tax implications.

Join us as we navigate the complexities of financial planning and empower you to make informed decisions for a secure financial future.

About Today’s Guest

Tim Baker is the Co-Founder and Director of Financial Planning at Your Financial Pharmacist. Founded in 2015, YFP is a fee-only financial planning firm and connects with the YFP community of 12,000+ pharmacy professionals via the Your Financial Pharmacist Podcast podcast, blog, website resources and speaking engagements. 

Tim attended the United States Military Academy majoring in International Relations and branching Armor. After his military career, he worked as a logistician with a major retailer and a construction company. After much deliberation, Tim decided to make a pivot in his career and joined a small independent financial planning firm in 2012. In 2016, he launched his own financial planning firm Script Financial and in 2019 merged with Your Financial Pharmacist. Tim now lives in Columbus, Ohio with his wife (Shay), two kids (Olivia and Liam), and dog (Benji).

Key Points from the Episode

  • Debt repayment, investing, and retirement planning.
  • Retirement savings and investment strategies.
  • Retirement planning and nest egg calculation.
  • Retirement planning and the “Nest Egg Exercise” to connect long-term goals with current actions.
  • Prioritizing debt and investing strategies.
  • Prioritizing debt payoff vs. investing for financial freedom.
  • Financial planning and prioritizing goals.
  • Managing $200,000 in student loans without PSLF.
  • Student loan debt and financial planning.

Episode Highlights

“I think what, what sometimes happens, Tim, is that we try, we try to do a lot. We try to do a little bit of a lot of things versus a lot of like one or two things. Yeah. So I think working with a planner to help you prioritize is going to be really important.” – Tim Baker 

“So I think the best thing, and we we’ve done this a lot, and when we speak, Tim, the best I think way to determine if we’re on track to retire is to do a nest egg nest egg calculation” – Tim Baker

“But I do think that that push and pull between today and tomorrow is really important. So let’s focus on that trip to wherever; let’s focus on the down payment for a real estate property or whatever that is, like those things, I think, have to be part of the plan as well.” – Tim Baker

“The cons of paying off debt, I think, is the opportunity costs of, like, what you might miss in terms of if you were to invest that, especially if the interest rates are really low, and then just kind of just overall money,less money for investments. The pros, I think, of investing, is potentially higher returns, although not guaranteed, compounding growth, potential tax benefits, if you’re putting in things like 401Ks and IRAs.” – Tim Baker

 

Links Mentioned in Today’s Episode

Episode Transcript

Tim Ulbrich  00:00

Hey everybody, Tim Ulbrich here and thank you for listening to the YFP Podcast where each week we strive to inspire and encourage you on your path towards achieving financial freedom. This week, YFP Co-Founder, Director of Financial Planning and Certified Financial Planner Tim Baker joins me to answer your top three financial questions. During the show we tackle pros and cons of paying off low interest rate debt versus investing strategies to optimize student loan repayment for those not pursuing Public Service Loan Forgiveness and how to determine how much one needs to save for retirement. Before we jump into the show, I want to make sure that you’re aware of our next YFP Open House that I’m hosting on Thursday, March 14 at 8:30pm. Eastern. If you’re wondering how working one-on-one with a financial planner can help you achieve your financial goals, the best place to begin is by signing up for our open house. You can do so by visiting YourFinancialPharmacist.com/openhouse. 

During this open house, we’ll help you gain clarity on your vision for living a rich life and how the financial plan can become the engine for achieving that vision. We’ll also help you determine how much is enough when it comes to retirement planning whether or not you’re on track. I’ll be taking the group through nest egg calculation. You can learn about the nuts and bolts of hiring a financial planner including what to look for different types of planners that are available and why fee-only planning matters.

And finally, we’ll cover an overview of YFP services, including our financial planning, and tax and accounting services. Make sure to sign up to attend live. We won’t be recording this workshop. For those that attend, they’ll receive an interactive workbook as well as a free resource: Where Should My Next Dollar Go? that will help you assess your overall financial well being and provide clarity on how to efficiently deploy cash, avoid overspending and prioritize various goals. Again, you can register for this Open House on Thursday, March 14 at 8:30pm Eastern by visiting YourFinancialPharmacist.com/openhouse. Alright, let’s jump into today’s episode. 

Tim Ulbrich  02:04

Hi there, Tim Ulbrich here. Welcome to this week’s episode of the YFP Podcast. I’m excited to welcome Tim Baker back to the mic as we’re gonna put him on the hot seat with some rapid fire Q&A with some of those common questions that we get from our community, including those around debt repayment, investment, and retirement planning. Hey, Tim, it’s been a while since we’ve had you on the show, what’s new, what’s exciting?

Tim Baker  02:24

What’s new? We’re in the throes of tax season. So I’m, we’re busy there. I’m talking to a lot of potential clients coming on board. Baby number three is about a month away, Tim. So we’re preparing for that. I joke we have about 1000 projects that we have to complete before the baby gets here. So you know, kind of maneuver in my my wife’s lifts list here. So but yeah, all good. Thanks. No complaints.

Tim Ulbrich  02:55

Well, we’re excited to jump into these questions. I know it’s a busy season for you, busy season here for YFP as you mentioned in the midst of tax season. And, you know, we’ve been, we’ll talk at the end of this episode about our YFP Plus community, our new community that we’ve been offering now for a few months. And it’s been really exciting to see the questions and the engagement that that group has, and one another jumping in answering those questions. And we wanted to pull three of the most common questions that we get, whether it’s inside of that community, whether it’s, Tim, questions that we get when we’re speaking that come up on repeat. And so they may be variations of these, but you know, common questions around things like hey, how much do I need to have saved for retirement? What are the pros and cons of paying off debt versus investing? That’s probably the most common question that we get. And, you know, what should I do with my student loans? And how can I best optimize the repayment strategy? So let’s jump into these one by one. Tim, the first question that we have is a big one, but how much do I need to save in order to retire? How much is enough? And how do I begin to determine what that number is?

Tim Baker  03:57

Yeah, so I mean, it depends. Just gotta get that out of the way, right. I mean, this is such a multivariable thing. I think it’s just really hard to determine, you know, without a, you know, pretty deep level analysis to be honest Tim, you know, I know, you know, I’ll talk through some rules of thumb here and things like that. But, you know, like I was talking to a couple last night, and, you know, I think the the wife, the pharmacist was, like, you know, I kind of want the same level of comfort in retirement that I have today in terms of like my standard of living and the husband, the spouse, was like, I could live in a tent and be completely content. You know, so like, so like, that’s, that’s a big thing. You know, like if, if what your need is in retirement, you know, you could have enough saved today, Tim,  like it’s it really don’t know. So the variables there, some of the variables could be you know, the standard of living the time in retirement. There’s a lot of clients that we work with that like, will say like, Hey, like I don’t know how long I’m going to be around because of my family history. So we, you know, we put that in, in in play, taxes, inflation unexpected, you know, expenses, a lot of that can be medical, even the inability to work so that, you know, a lot of people, when they’re when they’re doing this calculus, they’ll say, Oh, I’ll work till 70. Or I’ll work part time. And the stats say that 40% of the people out there are going to going to stop working earlier than they think that they do. So you know, what I always do, there’s, there’s lots of fancy ways to kind of calculate this. And you know, if you’ve ever heard of Monte Carlo analysis, this is where we, we simulate portfolio returns 1000s of simulations and say, with, you know, X percent probability of success, we typically want, anywhere from 70 to 80% probability of success, you might say, Tim, why not 100%. Typically, if we’re, if we’re lower than, you know, 70%, we’re going to adjust the plan accordingly, in real time to get it to the end of that.

So I think the best thing that and we we’ve done this a lot, and when we speak, Tim, the best I think way to determine if we’re on track to retire is to do a nest egg nest egg calculation. And this was really born out of, Tim, like, back in the day, when I started advising people on their on their, you know, retirement stuff. What I learned from a mentor is we would say, hey, based on your based on these assumptions, you need $3.5 million to retire. And then we would just move on to the next thing. And I would see the, the look in people’s eyes were like, that number just didn’t hit the mark at all, like it was just like, it was kind of equated to like student loans where it’s just like Monopoly money, that doesn’t make any sense to me at all. So what I started to do is I would take that number, and then I would kind of use another time value of money calculation to discount it back to a number. So if you’re the client, Tim, a number for Tim in 2024, that actually is digestible to you, that’s palatable to you that says, okay, like that makes sense. And typically, what we’re doing is that we’re comparing, you know, what you’re putting into your 401 K, your IRAs, what you already have, you know what your allocation is, so we can kind of make some assumptions on performance returns, how long you’re going to work. And then we can say, hey, you’re on track by this amount of dollars per month, or you’re off track by this amount of dollars per month. And obviously, that that hill gets steeper, if we’re off track, the closer that we get to our target. So, to me that that’s a huge thing to actually connect the dots to, like when I ask people like, are they on track? A lot of people say I have no idea or they’ll say, like, I’m using a calculator, that typically is not a great indicator of where they’re at. So, but I think a lot of this goes back to kind of, you know, move the answer forward is like, you know, what do you need, you know. A lot of the estimates, you know, a lot of the estimates will say, you know, a lot of retirement planners will say, hey, you need 70 to 80% of your pre-retirement income in retirement. And that’s typically the reason for that. It’s like, you’re typically saving 20, 30% of your income, pre retirement, like so leading up to the years of retirement. And you’re not doing that in retirement. So, but a lot of that, Tim, also misses the mark, right? Because it’s like, alright, well, if I’m, like, 20-30 years from retirement, what does that even mean to me? Right. But if you take, you know, I did a kind of a, an example here, if you’re making $125,000 today, and you have a 30 year career ahead of you, and you get a 3% cost of living adjustment every year, in 30 years, that equals $303,400.00. Three or three 400.

Tim Ulbrich  08:55

Almost hard to believe, right? When you when you put the numbers on that.

Tim Baker  08:58

Yep, But then if you look back 30 years, like look back at, like, what a total cost of like a house was or like, what the… you know what I mean? Like, so you have to, you know, it’s perspective, right? So, so 30% of that $303 is about $212. So, essentially, what you need is $212 for 30 straight years, so every year $212. And then we had to, you know, account for inflation and things like that. 

Tim Ulbrich  09:22

$212,000?

Tim Baker  09:24

 $212,000. Right. So you need a portfolio. So if you just do it in simple terms to earn 12 times 30 Like, that’s kind of like, that’s a very, you know, linear way to look at it. But then you have to, you know, factor in things, you know, like variable expenses and things like that. So, what a lot of people will point to which, I don’t love it, because I think it can steer people wrong, but I think at least gets a like a foundation of where to think about this is the 4% rule. So the 4% rule is, you can withdrawal 4% of your savings in the first year retirement adjusted for inflation ever year thereafter, to ensure that your saving, you have enough saved for 30 years. So the way to kind of backwards plan to that is if you multiply your annual retirement expenses, so let’s say you need 40, that let’s say you need $60,000 per year, let’s say 20,000 of that comes from Social Security, then we need $40,000. $40,000 times 25 years, so we’re just doing the 4% inverted is a million dollars, or a million dollars times, you know, point 0.44% is that $40,000. So that’s a way to look at it. But again, like, I don’t know, if that does a great job of, you know, planning for longevity, you know, there’s a lot of there’s a lot of errors in that, you know, in that assumption, but I think it’s a good place to start thinking about this. So, I mean, it’s a, it’s a really big question that has a lot of, you know, at anytime that you look at something over, you know, 2030 years, I guess, if you’re closer to this, maybe maybe the questions a little bit easier to answer, but, you know, looking at expenses, you know, looking at budget, the budget never goes away, you know, people are like ugh budget, you know, scenario analysis, I think all of those things kind of play into this. 

Tim Ulbrich  11:10

Again, this is why I love as you mentioned, the the nest egg exercise, you can see the connections that people start to make in that exercise. Now, of course, especially if we’re looking over a long horizon, right, 20-30 years out, or even if it’s 10 years out, like things are going to change, this is not a one and done, you know, type of thing. We’ve got to be looking at it on a regular basis. But when you’re able to take people from that overwhelming shock number, right, 3 million, 4 million, 5 million to as you said, Hey, here’s what we need to be doing this year and actually, this month. Like this is what we need to be doing based on what we have saved, based on a set of assumptions that we obviously have to think through and think about risk tolerance, capacity, all those kinds of things, based on what we choose to assume or not with Social Security, you know, based on what you’re getting through your employer, all these things are going to feed into where we at currently, and what do we need to be doing per month. And, you know, I did this recently, during an Open House that we did in February, I’ll be doing it again, in our next open house coming up on on March 14, again, you can register for that yourfinancialpharmacist.com/openhouse.

And what’s fascinating about that is I can see this come to life, when people start to just see how these numbers are calculated and see the assumptions in place. Because, again, we’re actually making it mean something today, right? When we look at a number per month, we can start to see how that does or doesn’t fit in with the budget, we might not like that number. But we can start to actually work with that. And in fact, sometimes we find out through this exercise that people are over saving, you know, and there’s a conversation to be had there about, hey, how do we feel about it? What other goals are happening? And might we shift around, you know, different priorities? And then you can toggle some of these factors like, Hey, I said, I wanted to retire at 67. But what happens if it’s 62? Or 58? Or, you know, hey, I’d like the work that I’m doing, and I don’t really see myself going from full time did nothing for 30 years. What if I’m working part time and having an income? And these changed things significantly when you look at these calculations.

Tim Baker  13:08

Yeah, I mean, if I do say so myself, I think it’s a great tool. I think it was born out of like the misconnection between that big number in the future and what we’re doing today. And I think to your point, like being able to, like toggle those levers and pull those levers, you know, whether it’s, you know, working longer working less, you know, dialing back things, you know, down up things like I think it’s really cool to see. And to your point, yeah, we’ve had a lot of clients that have definitely, you know, we talk about, you know, living a wealthy life today and will live in a wealthy life tomorrow. Sometimes the calculus shows that they’re really focused on living a wealthy life tomorrow, in spite of today, meaning like, you know, I think it’s rare for a financial planner to say like, Hey, you’re saving too much for retirement. But I do think that that push and pull between today and tomorrow is really important. So like, let’s focus on that trip to wherever let’s focus on you know, that, you know, down payment for a real estate property or whatever that is, like the like those things, I think, have to be part of the, of the plan as well. So yeah, it’s a great question to ask. It’s just really hard to, to to answer without, you know, a lot of detail. A lot of, you know, what’s the balance sheet look like? What are the goals and, you know, go  on from there.

Tim Ulbrich  13:14

 It is.

Tim Ulbrich  14:34

If listeners want to dig deeper on this topic, first love to have you join us at the Open House. Second, we’ve covered this as a stand alone topic on the episode on the podcast before Episode 272. Tim and I talked about how much is enough and how do you determine that. We’ll link to that to the show notes. Make sure to check out that episode as well. Our second question we have as I mentioned before, probably the most common question that I get when I’m presenting is Hey, what are the pros and cons of paying off low interest debt, such as a student loan or auto loan versus investing. Furthermore, how do you think about prioritizing strategies for paying down debt, saving for retirement and saving for a house down payment? Tim, I’ll add to this before you jump in here that this is a really common question that we see, especially among, you know, those within that first 10 years of graduation, right. They’ve got a lot of things that are coming at them. I’ve got, you know, a bunch of student loans, I’m looking at buying a home, you’re telling me that I should be investing in saving for the future? I need an emergency fund. How do I begin to prioritize and weigh all these things? And, again, before you say, it depends, like, I think this is an example question where the value of planning is so important, because we got to get all those things out of our head on the paper, so we can start to plan. So what are your thoughts here?

Tim Baker  15:46

Yeah, I mean, I always look at debt as like a spectrum. I think you have, you know, good debt, which, you know, I would I would categorize as, like a mortgage. I would still put student loan debt in there, because, you know, a mortgage is a, you know, typically appreciating an asset that you can, that you’re living in, raise a family. Student loans, typically, you know, the price of doing business to become a pharmacist, you know, higher levels of of income, you know, post degree. But then as you go like, like auto loans, again, again, these are used assets that are typically depreciating. You’re typically paying higher interest than you have in the past, but it serves a function of like getting you to work. But then as you go, it might be things like, debt for furniture or other types of personal loans. And then credit card debt is typically at that, you know, other end of the spectrum of bad debt, where it’s, you know, you’re typically, this is the purchase of of wants not necessarily needs, or, you know, it’s there because of a lack of an emergency fund or kind of planning, planning for those unexpected things. So, you know, I think like, where you sit, where you draw the line between good debt and bad debt, it’s going to different be different for everybody. You know, typically, it’s, it’s the car to the right is good debt. So car, student loans, mortgages, are okay. And then everything for the left is not. Some people will put cars like a bad debt. So I think it just depends on what your again, what your goals are, what your what your aspect of debt. You know, I was asked recently by a prospective client about like, you know, hey, was watching something that Dave Ramsey said about paying off, you know, a mortgage that’s less than 3%. And he’s very, paints with a broad brush and said, like, you know, really any debt, you’re kind of a slave to the master is kind of how he describes it. And I think like, there’s a psychological thing of this, like, if you if you feel like that debt, is preventing you to be financially free, that I would treat that differently than something else, you know, like, I have no qualms about sitting on my two and a half percent mortgage for 30 years, I just don’t. So I think if we look at this, like the pros of paying off debt, versus invest in, you know, the paying off debt, it’s a guaranteed return, right? So if your debt is 6%, that’s, you know, you’re not necessarily gonna get that in the market consistently. So it’s a guaranteed return. I think it reduces financial stress. So eliminating debt can reduce stress and kind of simplify your finances. You do, I think, if you are completely debt free, I think you can you operate differently, you think you look at the world a little bit differently than if you have, you know, multiple liabilities. That’s kind of, you know, weighing on you and we see this with student loans, Tim, right. Like, you know, I feel suffocated, because I have this $200,000 in debt. The cons of paying off debt, I think, is the opportunity costs of like, what you might miss in terms of like, if you were to invest that, you know, especially if the interest rates are really low, and then just kind of just overall money, you know, less money for investments. The pros, I think of investing is potentially higher returns, although not guaranteed, compounding growth, potential tax benefits, if you’re putting in things like 401Ks and IRAs, The cons are again, market risk, there’s no guarantee. And, you know, complexity, like you know, if you’re just paying off debt, you know, a lot of people will make investing more interesting or sexier than it needs to be I look at as an as an investment as it should be super boring, but not everyone does that. A lot of people don’t do that. So that’s, that’s kind of my, there is no right or wrong answer. I kind of have my own biases.

When I’m working with a client, I’ll look at their risk tolerance. I’ll look at what their goals are. I’ll look at like, what are they saying to me? If they’re saying things like, this debt keeps me up at night, I’m gonna treat that very differently than if someone’s like, yeah, like it’s whatever. But there is a mathematical component to that as well. In terms of prioritize and financial strategies or just get the financial, like, what do we do, you know, for paying down debt versus saving, you know, I was speaking to, you know, a prospective client the other day, and they have real estate, they have some investments, they have a brokerage account, no emergency fund. So like, we’re we’re doing steps, six, seven, and eight, before we’re doing step one, really. So building an emergency fund, having a high yield savings account with, you know, those non-discretionary, you think expensives, just stowed away. Super important. That’s, that’s a foundational thing. I think from there, it’s also like the consumer debt, so like credit cards, you know, furniture debt, whatever that looks like, I think is really important, because it’s typically higher nterest that you want to get get out from underneath.

I would also put taken advantage of the employer match up there, like, you know, most of the time, I think that is really, really important to get the free money. But still see people that don’t take advantage of that. And then I think looking at higher interest debt, paying that off. So, you know, maybe that is a car, you know, we’re seeing, you know, car rates, I think you you mentioned it in YFP plus community, just what those rate rates are. Shocking, you know, they’re high. So I assume, yeah, I would I, I would pay that off before I would go into the market. So I think that that to me, and again, like the one thing that the questioner asked, you know, it’s like, what about saving for retirement, again, I kind of look at, get the match. And then I look at it as that as you are navigating these other things to me, in the back of your mind, it should be a race to 10%. Like, get the match, which may be 5%. But then you really want to get to 10% as quickly as possible, and then assess from there. And then I think, like, to me saving for a house down payment. That’s a really tough one to prioritize, Tim, because oftentimes with this one, like, like you’re, you, you rationalize it, you know, you rationalize your decision. So like, it’s a super emotional decision, once you start going down the path of looking at houses, being a Zillow warrior, actually go into houses, like those timelines get cut overnight. And I always joke, like, I was talking to a prospective client. And they were like, Yeah, I want to buy a house in the next two or three years. And I talked to them two weeks later, and they were under contract. So to me, like, if that’s important for you, I would put that to the top, you know, put that at the top of the list, you know, and prioritize that. I think what, what sometimes happens, Tim, is that we try, we try to do a lot. We try to do a little bit of a lot of things versus a lot of like one or two things. Yeah. So I think working with a planner to help you prioritize is going to be really important. And it’s hard to do. Sometimes it’s hard to do that when you’re stuck inside your own head, or even with like a spouse. So sometimes that you know that that third party objective viewpoint to help you guide guide that conversation, I think is important. But again, there’s really no right or wrong answer here. It’s just tailoring to like when I say it depends. What I mean by that is, you know, it depends on what your balance sheet are, like, what your balance sheet looks like, and what your goals are. And unfortunately, you can’t like look at a neighbor or a colleague, because like you’re going to be different. You are a unique snowflake. So you know, your your experience, your life experience, your your finances are going to be different than than everybody else’s. And I think, you know, developing a plan that navigates that is super important.

Tim Ulbrich  22:39

Yeah, Tim, the visual that comes to mind, as you’re talking and I alluded to this, when I asked the question is, you know, we so often live with all of these competing priorities that are swirling in our minds, right? Guilty as charged. And it really is a step that often is hard work. But it’s really important because we’re a third party can be so helpful for us to kind of get out of our own way and make sure we’re looking at all the factors, making sure we’re not thinking of things in a silo. But it’s like, we got to put all the puzzle pieces out, we got to get them out of the box. So we can start to figure out how they actually come together. And then to implement the plan, looking at our cash flow, looking at our goals and things to actually begin to execute on that. But we tend to go into execution mode, without really considering all the pieces and parts and how they impact one another. And this sounds easy, but it’s not right. You know, in this question, you know, we’re thinking about paying down debt, you know, and that could be more than one type of debt. We’re thinking about, hey, when might we buy a home we think about saving for retirement, when you look at the percentage of take home pay that these things will take up it is huge. These are these are big decisions. And we’re not even talking about other types of goals, right vacation, travel, what else is going on the financial plan, so I feel like there’s such an important step here of, before you start running in any one direction. Hey, let’s get on with This down on the paper. You know, you did this for Jess and I back in the day, like, let’s create a prioritized list of these. What’s the target? What’s the goal? How much do we need? What priority, how much per month? And then we start to actually create the buckets and the mechanism and the thing to actually make these come to life. And when you’re doing that, and you’re automating that, I can’t even adequately describe the feelings that come when you know that that system is in place working for you. 

Tim Baker  25:26

Yeah and I think like to go back to the first question, like, we’ve had conversations with clients that like, you know, they’re saving so much for retirement, and they’re like, we can actually do a little bit less than get into the house sooner. Right. So like, like, if you think about it, like, my, my Pop Pop back in the day, like he had a pension, there was no such thing as 401k is like, all of these other things that have like, like, made financial, you know, even my parents, like, it’s very different. Now, you go into the workforce, and you have 30,000 things that are like, like, vying for your attention and your your dollars. And it’s just different than what it was before. And now, like the onus, especially on retirement is up to you versus like, your employer. But it’s also like, a lot of the advice that that you’re getting is from, like, the old generation of like, hey, buy a house, make sure you’re saving for it, and those are all good things. But the world is different now. And I’m not saying that, like, that’s, that’s bad, that’s bad advice. But like, you got to kind of have to, like, you know, walk to your own tune, so to speak. And I think like, a lot of people get get anxiety because they’re like, I’m not like, I’m not doing enough here. I’m not doing enough here. And, you know, I think like, if you’re doing a plan, you’re doing enough, right.

And I think part of the part of the great thing about plan is that you are slowing down in the day to day of like busy living and objectively looking at your situation and reflecting, self reflecting or forcing to reflect of like, Hey, are we on the track that we’re supposed to be on. And also to like, celebrate the wins, like, you know, when we start with a client, you know, the the first two meetings that we go through is what we call Get Organized, where we’re building out a nice clean balance sheet of all the assets that we own, minus all the liabilities that we owe. That’s our first data points. Think of that as like the before picture. And then the second meeting is what we call Script Your Plan is all about, okay, now that we know where we’re at, where are we going, so let’s talk about you want to buy a house, you want to have a family, you want to be able to retire at this age, you want to be able to, you know, build your real estate empire, you want to be able to do XY and Z. And once we have those two foundational thing in place, the answer “it depends,” then transforms to this is what I think you should do because I know what your balance sheet looks like, I know what your goals are. And this is the you know, the the objective advice that we think is in your best interest. So like, that’s going to be different for everyone. And I think like that, you know, tracking that from data point one to three, you know, two years, three years in the future, we start to see quantifiably the benefit, we think, you know, net worth is the best measure of that, the benefit from a net worth perspective, but then also the qualitative benefits of like, wow, like, I took that trip, I am spending more time with my family, like we had a family sooner than I thought, we bought the house. You know, I thought it was gonna take us five years, we did it live in less time. So to me, those are the benefits of, of, again, working on a plan, working with a planner to help prioritize all these things, right?

Because, you know, we talked about this in the in the tax world, we feel that working with one of our CFPs and a CPA side by side and stacking years of intentional financial planning and intentional tax planning will get you to where you need to, you know, be quicker. But you know, I was working, I was working, talking to one of our planning clients that’s considering tax, and they have a tax person, but they’re just you know, and it’s a question of filing separately and filing jointly. They’re just looking at it from the perspective of tax. They’re not thinking about how that affects how the filing status affects the student loan payment. So to me, you can’t look at these things in a vacuum. They they’re all interconnected. And I think as you go, that becomes, you know, more true and more obvious. So, again, I’m biased though, right?

Tim Ulbrich  29:33

It’s great stuff. And that’s why I’m glad you brought up the quantitative, qualitative stuff because yes, it translates into actual dollars and cents net worth is the indicator that we’re, you know, looking at most assets, what you own minus liabilities what you owe, but it’s also is the qualitative stuff, are we achieving that living a rich life and also as I alluded to, just the mental clarity and the peace of mind that comes from like, I know that I’ve thought about these or I know that me and my partner or spouse I thought about these together. And we have a plan like targeted dollar amount to that. But that really is incredible. And for folks that want to learn more about our one-on-one financial planning service, you can go to YFPplanning.com. Let’s have a conversation with you to learn more about that service, learn more about what you have going on in your own individual plan and see whether or not that service is a good fit again, YFPplanning.com. From there, you can click on the link to book a free discovery call. Alright, Tim, question number three. If PSLF, Public Service Loan Forgiveness, is not an option for me, what should I do with $200,000 of student loans? How do I wait paying them off versus pursuing 20 to 25 years of forgiveness, which would then result in what we call what others call the tax bomb? So what are your thoughts here?

Tim Baker  30:49

Yeah, and again, forgive the continued commercial, Tim, but like, I think when you’re dealing with six figures worth of debt $200,000, I do think some type of an analysis is really important, especially with like, the moving goal posts, that are the student loan repayment plans, and then the strategies that are out there. So I think, you know, this is a math equation that comes from the analysis, but I think you have to also overlay how you feel about the debt, right? So again, if you’re like, like, I need to get through this, like, ASAP, like, it’s a weight on me versus  like, it is what it is, I think that with the math equation is going to color how like, I would advise you as your planner. So I would say back in the day, you know, when we would look at a potentially non PSLF, you know, strategy. So, just to remind everyone PSLF, you know, was implemented in 2007. And the so that means that, you know, the first the first time someone was able to be forgiven was 2017. So you had to, you had to work, you had your loans had to be federal, you had to be in the right type of a repayment plan, you had to work for a non-profits 501C3, the government. You paid, you know, 10 years worth of payments didn’t have to be consecutive, and then you were forgiven tax free. You can, you’re eligible for forgiveness, you’re still eligible forgiveness outside of PSLF, we call it non PSLF. The, it’s a little bit different, you still have to have the right loans and the right plan, it doesn’t matter who you work for. So you can work for a for-profit. But instead of paying it for 10 years, you are paying it for 20 or 25 years of their graduate loans. And then that forgiveness amount is taxable in the year forgiveness, whereas PSLF, it’s a tax free event. So in before, you know, the new, the new plan, the save plan, typically the calculus was if your debt to income ratio was higher than two to one. So meaning I made 100,000 and I had $300,000 in debt, my debt to income ratio was three to one in that case, then a non-PSLF strategy was on the table. Because by the time we looked at $300,000, and a standard or even a refi, by the time we looked at that compared to a an income driven plan, plus, you know, a couple $100, or whatever that was invested for a tax bomb, what you paid per month, and what you paid in total was less than what you would pay in standard.

Now with the save plan and the payments a little bit different that it’s it’s it’s changed a little bit. So I would say that, you know, and the other thing that’s changed, too, Tim, is that, you know, we’re, if if we were looking at non-PSLF, we were also looking at like, typically a refi. So like if we, if our rates were 6% Wait it, you know, you might be able to go out. And for the same 10 year, find a 4.5% or 5%. So you’d get a little bit of a better rate. That’s changed too, right. So now what we’re having a way is a non peel PSLF strategy, versus staying in the federal system with potentially a better interest rate, but meet just maybe keeping the standard, you know, the standard plan. So if you have $200,000 in debt, the standard plan is going to be $2,171 for 10 years. So I think the play here is potentially looking at a refi which I don’t know if you’re necessarily going to be you know, I would look at a 10 year if you can go a little bit more aggressive seven year, five year. But your your, you know, your your payments going to go up accordingly. So, again, the goalposts have changed a little bit here. You know, I would say that, you know, I would say that probably a non-PSLF strategy here if I’m assuming you’re making $125, $130, is probably not the way to go. So probably something in the standard, maybe even being more aggressive in the standard or, again, looking at refis if rates come down, you know. I’m not sure what the 10 year if you do an apples to apples, but there are some benefit, there are still benefits to staying in the federal that I wouldn’t want there to be a pretty, pretty significant interest rate decrease for me to move off into a private loan. And that’s irreversible. So before Tammy, we would just say, Hey, this is kind of the rules of thumb, this is the way to look at it. But it’s a lot different because of the new save plan, the interest rates, etc. You know, so that’s basically where we’re at today.

Tim Ulbrich  35:35

Yeah, I think as you pointed out, the income of this individual is a really important piece of information we don’t have, right because if they’re making $180k, versus they’re making $95k, that’s going to impact that debt to income ratio. And to your point with the new save plan, that ratio, in effect has gotten more favorable. What I mean by that, is because of the change in the plan, the debt to income threshold could potentially be lower and it might make sense to pursue a non PSLF pathway. And, you know, let’s zoom back out, right? We’ve been kind of preaching on not not getting into the silos have to decisions, when you’re talking about hey, do we go more aggressive? Do we not that gets back to conversations about cash flow? What does the budget actually support? What other goals are in mind? You know, are we someone who graduated in their mid to late 20s? Or is this someone that pharmacy’s a second career, and they’re behind on investing in retirement – all of those things, just a few examples are going to impact, right, what decision we make with the student loans and how it ties into other decisions that are happening in the financial plan. So, Tim, great stuff.

These are just a few of the types of questions and conversations that we are seeing inside of our new online community called YFP Plus if you’re not already familiar with YFP Plus, we’d love to have you check out that community. Inside you’ll find exclusive on demand courses, We’ve got weekly live events, we have monthly themes and challenges. So for example, this past month in February, we were talking all about preparing for Uncle Sam and taxes bringing in Sean our CPA into the community. For the month of March, it’s all about FIRE: Financial Independence, Retire Early. We’ve got several events lined up throughout the month, the space to ask questions of our financial planners and our tax professionals and to be in a community of other like minded individuals. It’s really an incredible community. We hope you’ll check it out and use our 30 day free trial to determine whether or not it’s a good long term fit for you. You can do that by going to yourfinancialpharmacist.com/membership to get more information on YFP Plus. Again, yourfinancialpharmacist.com/membership. Thanks so much for joining us. We’ll see you next week. Take care. 

Tim Ulbrich  37:37

[DISCLAIMER]

As we conclude this week’s podcast and important reminder that the content on this show is provided you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding materials should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. Furthermore, the information contained in our archived newsletters, blog posts and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of Your Financial Pharmacist unless otherwise noted and constitute judgments as of the dates published. Such information may contain forward looking statements, which are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer. Thank you again for your support of the Your Financial Pharmacist podcast. Have a great rest of your week.

[END]

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YFP 348: 2024 Housing Market Trends & Assumable Rate Mortgages


Tony Umholtz of First Horizon shares insights on the real estate landscape for 2024. Sponsored by First Horizon.

Episode Summary

In this week’s podcast sponsored by First Horizon, we’re joined by Tony Umholtz, a Mortgage Loan Officer from First Horizon, to delve into the housing market updates and trends for 2024. He shares insights on current rates, supply/demand dynamics, and the impact of projected Fed Rate cuts in 2024 on the market. The episode explores the pros and cons of buying a home now versus waiting and delves into assumable rate mortgages—what they are, how they function, eligible loan types, and their growing popularity.

About Today’s Guest

Tony Umholtz is the Senior VP of Mortgage Banking at First Horizon. He graduated Cum Laude from the University of South Florida with a B.S. in Finance from the Muma College of Business. He then went on to complete his MBA. While at USF, Tony was part of the inaugural football team in 1997. He earned both Academic and AP All-American Honors during his collegiate career. After college, Tony had the opportunity to sign contracts with several NFL teams including the Tennessee Titans, New York Giants, and the New England Patriots. Being active in the community is also important to Tony. He has served or serves as a board member for several charitable and non-profit organizations including board member for the Salvation Army, FCA Tampa Bay, and the USF National Alumni Association. Having orchestrated over $1.1 billion in lending volume during his career, Tony has consistently been ranked as one of the top mortgage loan officers in the industry by the Scotsman’s Guide, Mortgage Executive magazine, and Mortgage Originator magazine.

Key Points from the Episode

  • Housing market trends in 2024, including interest rates and supply/demand. [0:00]
  • Housing market trends and mortgage rates. [2:37]
  • Home insurance costs and roof age impacting mortgage approval. [5:29]
  • Housing market trends and financial planning for a growing family. [11:14]
  • Refinancing and assumable rate mortgages. [17:11]
  • Pharmacist home loan options with 700 credit score minimum. [23:26]

Episode Highlights

“One of the positives are again, these are, you know, inventory levels, on average or higher in most markets. So every markets different we’ve talked about that in the past, some markets are, you can’t generalize across the country. But on average inventory levels are better in most areas. And typically around this time of year, you build a little bit more inventory.” – Tony Umholtz

“I mean, what we saw in ’21, ’22 ’20, as well, that was unhealthy. It was great to see your house price go way up, and you make made money on equity. But it was unsustainable. Having 2023 was a blessing. Yeah, I mean, look at it that way. I mean, that was unsustainable. And this was a blessing for all of us, because it would have created a bubble in my mind. And we stopped it. And the fed helped to stop that. And I think that was a win.” – Tony Umholtz

 

Links Mentioned in Today’s Episode

Episode Transcript

Tim Ulbrich  00:00

Hey everybody, Tim Ulbrich here and thank you for listening to the YFP Podcast where each week we strive to inspire and encourage you on your path towards achieving financial freedom. This week I welcome First Horizon Mortgage Loan Officer Tony Umholtz back onto the show. During the show we discuss housing market updates and trends for the first quarter of 2024, including current rates supply and demand and how the projected fed rate cuts for 2024 impacting the market. We also discussed the pros and cons of buying now versus waiting and all things assumable rate mortgages. What they are, how they work, eligible loan types and why they are growing in popularity. Alright, let’s hear from today’s sponsor First Horizon and then we’ll jump in my interview with Tony Umholtz. 

Tim Ulbrich  00:45

Does saving 20% for a down payment on a home feels like an uphill battle. It’s no secret that pharmacists have a lot of competing financial priorities including high student loan debt, meaning that saving 20% for a down payment on a home may take years. For several years now we’ve been partnering with First Horizon who offers a professional home loan option AKA a doctor or pharmacist loan that requires a 3% down payment for a single family home or townhome for first time homebuyers, has no PMI and offers a 30-year fixed rate mortgage on home loans up to $766,550 in most areas. The pharmacist home loan is available in all states except Alaska and Hawaii, and can be used to purchase condos as well. However, rates may be higher and a condo review has to be completed. To check out the requirements for First Horizon’s pharmacist home loan and to start the pre-approval process, visit yourfinancialpharmacist.com/home-loan. Again, that’s yourfinancialpharmacist.com/home-loan. 

Tim Ulbrich  01:50

Tony, welcome back to the show.

Tony Umholtz  01:51

Tim, it’s good to be here with you.

Tim Ulbrich  01:53

We’re excited to have you back. As always we look to you to get our most up-to-date information on kind of what we’re seeing in the housing market, especially for those in 2024 that are looking to buy or sell. I know we’ve got a lot of first time homebuyers out there in our community that have been anxiously awaiting for the right right time to buy. And we’ve got people that have been in their home for a while, maybe in a starter home that are looking to sell and to move to elsewhere. And just a crazy market that I think is hindered a lot of the movement out there of people buying and selling. So why don’t we start there, Tony, of some of what you’re seeing here early in the first quarter of 2024 as it relates to the housing market, you know. What’s what’s going on with interest rates? What are you seeing out there with supply and demand?

Tony Umholtz  02:37

Well, all good questions, Tim. And as always great to be here with you. I you know, it’s been an interesting year, as we haven’t been into 2024 very long, but a lot has happened. And you know it, we kind of forecasted that this year would be a little better than 2023 as far as you know, mortgage volume and purchase volume. But we knew it was gonna be a tough year, we’re still coming out of this, this higher inflationary environment. There’s been some headwinds. But overall, there’s a lot of good things we’re seeing. And then there’s some not so good things. So I’ll start with one of the positives. One of the positives are again, these are, you know, inventory levels, on average or higher in most markets. So every markets different we’ve talked about that in the past, some markets are, you can’t generalize across the country. But on average inventory levels are better in most areas. And typically around this time of year, you build a little bit more inventory. But in a lot of places we haven’t had this amount of inventory since the 2019 are right before the pandemic, which is nice for buyers, right, because you’re finally getting an ability to find some some product and to negotiate a little bit. That being said, we’re still not in a normal market, we’re still under a normal market. Most markets are in that four month range of inventory. And an average markets probably five to seven months right inventory. So we’re still in a fairly tight environment for housing. And we’re still a bit under built nationally, meaning that we don’t have enough housing units. So that’s also you know, one of the reasons housing prices haven’t fallen, you know, despite the higher rates and the headwinds in the economy. Regarding rates, we have seen rates rise since the beginning of the year, and the rates were  higher in October, early November than they are now. But we’ve seen an increase in a lot of that is due to positive economic data. Economic data has been positive on the you know, on the spending front, unemployment has been good, inflation is still there. I will say this to the last inflation report had had inflation but it was counting some inflation from last year. So like if you look past that we’re really going in the right direction. So I think the I think rates are gonna go down as time goes on. I think it’d be very slow this year. But you know, post the election, I think things can be pretty good. So I mean, it’s a roughly a year away, but I think you’re gonna see rates really get better as time goes on. But the other issue too coming back to this, you know, supply and demand we have as a mortgage company, we have so many clients we’ve pre-approved that are looking. It’s just gonna be, and I’m just one of many, but you know that it’s just going to get more competitive as those rates drop. So it’s like a kind of like a double edged sword, I think, you know.

Tim Ulbrich  03:32

Yeah, and I know we see that, Tony in our community. You know, a lot of first time homebuyers that’s it’s natural, right. As a new graduate, you finish pharmacy school, you’re looking at that home purchase. A lot of people are getting antsy on the renting front, “Hey, I’ve been renting for a while not not as long as I wanted.” They’re looking at what they’re paying for rent “Hey, I’d love to own a home, we’d love to build some equity long term.” And so certainly some pent up demand I know we see in our community. And I think that’s natural and expected to hear it broader than that, too. And I want our listeners to kind of hold that thought on, hey, if interest rates do come down, you know, here in 2024, what is the impact that that might have on the availability of the market? Because we’re going to talk a little bit about, you know, this concept of buy now versus wait, and what are some of the pros and cons. But before we do that, Tony, you shared something with me, before we hit record that I thought was of interest, would be of interest to our listeners, about what you’re seeing out there related to the age of a roof and how that might impact being able to get an insurance policy, which of course, you know, for homebuyers is a really important piece. So tell tell us more about what you’re seeing there?

Tony Umholtz  06:36

Sure. I mean, in the insurance aspect, it’s really big. And I think certain states are going to be tougher than others. So you’ve got, I’m based in Florida. So we’re ground zero for this, right? Because we’ve had, we had some legislation here in Florida that made, there were some abuses in you know, really more against the insurance industry, by various groups, and so forth. And people really has taken advantage of some of the flexibility. And it caused some challenges here. And there’s been some changes, as always, insurance companies are going to change what they insure, and one’s been roof age, right. So roof age is a big deal down here. It’s also in other states, too. So it’s not something that’s just here. And, you know, the costs of insurance have gone up a lot, right, and especially in more hurricane prone areas, or fire prone areas in the West, you’ve seen cost of insurance go up and I’ve seen like newer properties, you know, while they’re more expensive, the cost of insurance is much lower, you know, on newer construction, but it is more expensive generally to buy new construction. I would say the the age of the roof can vary a lot but and type of roof, whether it’s shingle or tile. So a tile roof typically has a longer age of life than a shingle roof. And the you know, though, sometimes we’ll cover those longer, but some insurance companies won’t touch it under 10 years, if it’s under, it’s got to be under 10 years, some are 15 years, some will go longer with what’s called a four point inspection, which not only looks at the roof, but looks at your, you know, your electrical, as well, looks at your plumbing, and other aspects of the home. But those are some things you may need to do. And it can become harder to get insurance or get the insurance that makes sense for you as far as costs go and coverage go. But it’s definitely an issue right now. And then, you know, with repairing a roof, it’s a lot of times it has to be done prior to closing. It’s not something you can essentially escrow. Right? You know, so, you know, if you’re selling a home and you have an older roof, repairing the roof is gonna help you get a much better deal on the house as far as the seller goes.

Tim Ulbrich  08:51

I’m glad you said that.  That’s exactly where my mind was going. Right? If people are thinking about selling a home, this has an impact. If people are thinking about buying a home, it has an impact. And obviously every area of the country is different in terms of the risk and the exposure here. But it’s just another good reminder when you talk about rising insurance costs that you know, especially for that first time homebuyer, it’s very easy to fixate on purchase price of the home, right. Purchase price of the home. And we want to be thinking about the whole financial picture. So yes, it’s the purchase price of the home. It’s the mortgage that we’re going to carry the principal and interest but it’s also the taxes. It’s also the insurance, it’s also the upkeep, you know, and all those things involved. So here we’re talking about an older roof and being able to get an insurance policy if you do those insurance costs potentially going up. On top of that would be obviously that potential replacement costs to be thinking about of the roof, as well.

Tony Umholtz  09:38

That’s right. I have one little trick and secret. This is something we’ve we’ve done for 20 plus years and it doesn’t have a bearing on anything with mortgage. But sometimes clients will say, “hey, I need to get this insurance down.” And you have to have an you have to have a certain amount of coverage to get a mortgage right. So, but one thing you don’t need is, I’ll see these policies come in with $600,000 worth of personal property coverage. Yeah, well, as a lender, we don’t care about personal property. Now I recommend if you got valuables you have some coverage, right. But a lot of folks, especially buying a first home don’t have $600,000 worth of artwork and other collectibles to insure. So a lot of times taking that down, we’ll give you some premium savings. And we’ve done that quite often, over the years or suggested that.

Tim Ulbrich  10:25

Good reminder, right, to kind of look at line item of your insurance policy and what you do or don’t need, especially if you’re looking at if you options. Tony, as an aside, but related to that I we had a unfortunate fire in our neighborhood of a home, just down the street. And ever since then, we’re now a year and several months out where there’s been no movement on the house. And I presume it’s related to something being tied up in insurance. I don’t know the full backstory. But ever since then I have looked differently at my replacement cost line item, as well as the relocation piece of, you know. When you think about how long might this go on? And what are the expenses associated for relocation. So good reminder to look and understand your homeowners insurance policy.

Tony Umholtz  11:08

Absolutely.

Tim Ulbrich  11:10

Tony, I want to get your opinion on buy now versus wait. Obviously, we’re talking broadly, this, of course, is specific to one situation. But what made me think about this is I had a conversation with a colleague a couple of weeks ago, this individual is about seven years into their career, dual income household, young family just had their second child bought their first starter home about three years ago. And they’re now itching to move, right. Family has grown. They want to get a better location a little bit closer to commute to work. But naturally, as a part of that they’re facing some headwinds, those headwinds are obviously the market that we’re in. Interest rates are higher. Home costs have appreciated, of course, and in this case, they’re moving to an area that the homes are just more expensive altogether. And so when I was asking some questions, you know, what I heard, and what made me think that this is probably resonate with a lot of our community is that there’s several barriers that they’re facing. Yes, the current market conditions, but also, hey, we’ve got these student loan payments that are still hanging around, right. We’ve got daycare costs, which are rising, you know, quickly, especially now that they have a second child. And they really feel like they need to be saving more aggressively for retirement, they feel like they’re behind on retirement. And I think this is a great example of someone that I will talk to, on a regular basis that’s in this new practitioner phase of their career that feels like they’re not on track with their other financial goals, and is feeling somewhat trapped by this home situation that they’re in. And, you know, if we were to consider a move, potentially, knowing what’s going on in the market, knowing where interest rates are at, you know, potentially do we buy now, when rates are not at the highest, as you mentioned, but they’re quite high and hope we can refinance in the future? Or, do we wait and see what happens with interest rates come down with at that point, running the risk that, hey, as rates come down, I think it’s safe to assume we’re gonna have a lot more, you know, sellers are gonna have a lot more buyers that flood the market. So just would love to hear your thoughts, you know, knowing that this is a common situation we probably would hear and see in our community.

Tony Umholtz  13:10

Sure. I mean, it’s a great question. And it’s very common across the country right now. We’re seeing some of our clients, you know, growing families outgrowing their home or have to relocate because of employment situation. Very common. So I would say I mean, like we take a step back, we kind of touched on at the beginning of our discussion here is, if you look at the overall market, we’ve got lower than average inventory in most areas still, even though inventories building which inventory buildings a good thing, because we need it going into the spring season. But the you’re likely going to see pretty stable housing prices, right? Probably escalating like even if you look year over year, prices went up over last year. I mean, certain pockets fell. There’s certain areas that you know, fell. I think, but but on average home prices actually went up last year. Even with all those headwinds, right. So I think you’re getting into a pretty stable investment, as well, you know, if you if you’re moving up, like in a situation with the colleagues you spoke to, I mean, moving to a better part of town, a bigger home. I mean, all these things could be meaning more appreciation on the house, too. So yes, the cost is more, but there is the upside of appreciation. I do think we are going to all see, like anyone that bought in the last year, year to year and a half, almost two years now. They’re going to get opportunities to refinance in the future. I can’t tell you exactly when. But we’ve even seen some that are popping up that made sense. Now after these last few weeks of rates rising. We had a few clients and some of them had to pay their loan for six months just because that’s a guideline for the type of program they were in. And we couldn’t refinance them, but they the rates have dropped over a point they could have refinanced already. There’s people that have already refinanced. So I think I think you’re gonna see opportunities for that as time goes on, where your cost of ownership will actually come down. But it is tough right now, it’s very tough. There are less buyers buying. So I think you’re gonna be able to negotiate better with sellers, which is the is the benefit. But it’s a tough decision. I mean, this is where you look at the whole financial plan. Yeah, right, you’ve got to look at, okay, I’ve got daycare costs rising, I want to save more for retirement. You know, that brings me to, like, you know, making sure you’re utilizing all your company matches, right. And all the things you can do if that other buckets going up for housing, you know, and in there is no question, housing prices have trended higher, and, you know, they may, what would be healthy and really, I’ll take a step back here. I mean, what we saw in ’21, ’22 ’20, as well, that was unhealthy. It was great to see your house price go way up, and you make made money on equity. But it was unsustainable. Having 2023 was a blessing. Yeah, I mean, look at it that way. I mean, that was unsustainable. And this was a blessing for all of us, because it would have created a bubble in my mind. And we stopped it. And the fed helped to stop that. And I think that was a win. It made my business a lot harder. I don’t mean a lot of people. But it was one of those things where it was it was a blessing for this industry, I think and the housing market in general. So you know, just again, to clarify, I think you you are going to see a fairly flat market, I feel like this year, I do think you’re going to see a lot people stepping in, I will also mention that builders are opportunistic. And the builders know, there’s an opportunity right now, because we’re under built, we didn’t build enough homes from 2010 to 2020. So they’re going to be building. We’ll get to equilibrium, eventually, in the next few years. And I think things will be a little different then, but I don’t think prices are going to collapse in most markets, you know. And I think there’s been a bit of a pullback in certain areas. But for the bread and butter communities where most people are owner occupied, you’re not going to see a lot of variance.

Tim Ulbrich  17:11

Great perspective, Tony. And I think what really resonated with me with this conversation that I had is, you know, yes, there’s the objective math part right of buying a home, and we want to make sure that it fits in with the rest of the financial plan. But it also, there’s an emotional part of this that is important, you know, for I know firsthand for us, our home is we spend most of our time in our home. It’s it’s a place where we’re making memories and experiences. And so there’s this tug and pull that I see with a lot of pharmacists, which is a healthy kind of balance that we’ve got to strike of, hey, how do we have a reasonable percentage of our income going towards our home so that we can achieve other financial goals, right, we don’t want to be house poor. But also we recognize that, you know, part of living a rich life today is potentially the home and what we’re going to be able to build in that community and our experiences and so forth. And this is the tug and pull, right that we’ve got to think about. I do have one question and I’m hesitating even ask this because I have a feeling the answer is it depends. But when you mentioned the the example of a 1% reduction and refinance, and you know, in that example, they hadn’t yet got to that six month timeline that you mentioned with that loan product. Is there a general rule of thumb that you think about in terms of rate differential and where someone starts to begin to think that a refinance, of course, when you consider costs involved in doing that may be advantageous? Is it at that point? Is it less is a little bit more? Or is it just too much of it depends?

Tony Umholtz  18:37

Well, I don’t want to say it depends, but there’s a lot of variables, and one of them is clearly is the loan size. Right? Which is, I mean, it might 21 plus years doing this in this business, I mean, generally said 1%, but I’ve had numerous, especially when we do what’s called premium pricing, which means we as a lender pay the closing costs, which is a way to do that. Now, you don’t get the same rate that you would if you paid the customary costs, right. But like I’ve had larger loans, where we’ve done it at as little as 50 basis points, which is a half point. But if you have a million dollar loan, and there’s no closing costs, and you’re saving  interest, you’re going to do it. So we’ve we’ve had all kinds of scenarios, but generally I look for 1% and that tend to people on the loan size and the state, certain states have higher closing costs than other states you know, so that would be the two variables.

Tim Ulbrich  19:31

Yeah, reason I asked I think to your point is we’re gonna see this come up, and maybe we’ll have to do another episode later this year if we start to see things trending because we haven’t talked about it right much in the last couple years for good reason. 

Tony Umholtz  19:42

I wouldn’t be surprised if we get into the third quarter and closer to the election, we start seeing some movement. So we’ll just watch it. 

Tim Ulbrich  19:50

The next thing I wanted to pick your brain on was around assumable rate mortgages. So I read an article on Wall Street Journal a couple weeks ago that really just piqued my interest about this topic and I know one we haven’t talked about on the show before, and obviously in the current rate environment that we’re in, I have a feeling some of this information starts to go viral. And people are like, Well, wait a minute, Can I get an assumable? rate mortgages? So can you define for us? What is an assumable? Rate Mortgage? You know, how do these types of products work? And then give us the, you know, the real life of how viable these may or may not be as people are considering their options?

Tony Umholtz  20:26

Sure, well, they do exist. It wasn’t just an article in the Wall Street Journal. They do exist. They’ve been they’ve been out there for a long time. And there’s really only three programs that are that are available that are assumable. And one is called an FHA loan, which we’ve touched on the other ones, a VA loan, and the last one is at USDA loan. So they’re all three government programs. And the interesting thing about VA is you don’t necessarily have to be a veteran, you can assume it, you still have to be approved by the servicing lender. But you don’t have to be a veteran, which is interesting, you know, and so, you know, couple of the the pros and cons, obviously, the big pro is, first of all, you have to find a seller willing to do this, right? That’s the number one thing. The other thing would be, I had someone call me on one of these just asking my opinion. And it was it was there was the ability to assume the loan, it was a low fixed rate, it was around three and a quarter or something like that much lower than today’s environment. But the amount of appreciation above what that loan is, and you have to pay the seller for all their principal reduction, but the home was worth so much more now on the down payment is huge. So like in this, I’m just kind of give you an example: They may have borrowed 300,000, but the house is worth $420,000. Yep, so you’re gonna have to bring $420,000 to get to the what they owe, or sorry, $120,000. So it’s $120k. It’s a big down payment. So with these assumable loans, a lot of times the new buyer has to come and compensate the owner for the difference and it’s a huge amount, right, normally, because the markets run up so much and you may have put money down. Now those three programs do, I mean FHA does carry PMI, but the rates are so low, that it wouldn’t matter in a lot of these cases. The VA loan, you have to get approved by the servicing lender, okay, so they will have to approve you for the product, that means you’re going to have to meet all the criteria for the loan size, just like any other loan, it’s not going to be the same as communicating like with a team, like myself or another lender that is originating every day, you’re not going to get that service level, it’s going to be more like a we’ll get to it, we get to that type of call. And but it is possible, it’s just not easy. You know, and not only do you have to find the proper owner in home, you know, the home you like with the owner that’s willing to let go of a loan, you’d also have to compensate them and have to have some cash for a down payment. There’s a there’s those are the various that’s why I don’t think well, I read the article too. And I saw there was a guide starting to start a tech business to, it’s just going to be really hard. At the end of the day, you got to you got to make it all work and meet all these guidelines. And, and and just I just think it’s going to be a detriment since the amount of money folks will have to bring to get that rate.

Tim Ulbrich  23:26

And that’s a piece, Tony, to be honest, I didn’t think a whole lot about right that what you’re highlighting the example the, you know, $300,000 home that’s not worth $420k, and they’re bringing $120,000 of cash, like you then have to factor in all of this what’s the opportunity cost of bringing a bunch of cash? Not not even a hey do you have it, but what’s the opportunity costs of that $120,000 of cash and not just focus on the rate comparison? Great stuff. Great stuff. Well, let’s wrap up by talking about the pharmacist home loan product that we’ve collaborated in sharing with our community, Tony, now for several years available through First Horizon. You know, I think more than ever, this is an area that we see of interest among pharmacists, even though there’s gonna be less that are out there in the market right now that are buying obviously, we’re gonna have more coming in the future. But as we’ve seen appreciation, as we’ve seen, the home values go over time, obviously that down payment for a new practitioner, especially that first time homebuyer can be a huge barrier. And you know, one of the questions that comes up is, hey, how can I potentially buy a home, get into a home without having to put down a conventional 20% down as I’m trying to focus on student loans, daycare costs, investing all the other goals that we talk about. And so I think that’s why we were so excited about this collaboration several years ago and continue to be excited about the collaboration is what this product can do for for pharmacists in that position. So tell us a little bit more about the pharmacist home loan product who it’s for, minimum credit scores, maximum loan amounts, how the PMI, all of that works.

Tony Umholtz  24:55

Sure, sure. Well, you’re the minimum credit score I’ll start with that is 700. You have to have a 700 credit score. And and if you’re a little below that my team, we have ways to help give ideas and actually help with even giving like a scenario to roll up for quite a few folks to show them what they can get their credit scores to by consolidating debt or paying down a credit card, wherever it might be. The max loan amount right now it’s in most counties is $766,550. But there are areas of the country where we’ll go higher based upon that, that the, you know, the, the counties maximum loan amount. So especially like in California, in and around like Northern Virginia. There’s certain areas where we can actually lend a higher loan amount because the loan sizes are higher, even a $900,000. And there is no PMI, which is the big big driver. And that’s like a car payment for most people when they buy a home, so we can save that with this program. There is no prepayment penalty, which is big too, we need you need that that reassurance that you refinance, if rates drop. The, you know, with the reserves and so forth, there really isn’t a big need for that. There’s even the ability for the seller to give some concessions, which we have to watch that as things go on. But that’s something that, you know, if you want to get some of your closing costs covered, to keep more cash back, that’s something else it’ll allow too. And that’s bigger now, you know, Tim, where I see when a home needs a little bit of cosmetic repair, just that extra $5000-$6000 that the seller is willing to pay or compensate. That can be the the ticket to getting that work done. So those are the things that that that it’ll allow. So there’s a few extra little pieces there. But 700 is a minimum credit score, we do look at debt to income ratios around 43%, not to get too in the weeds, but income to debt ratio. It does take a lower factor for student loans than like a traditional Fannie Mae loan would we do or FHA. So there’s a little more flexibility but yes, pretty pretty much a quick summary.

Tim Ulbrich  27:10

And you may have said it and I didn’t hear it but remind us of a percent down required for a first time homebuyer versus second.

Tony Umholtz  27:19

Good catch Tim. Yeah, so first time homebuyer is 3% down. No PMI. If you’ve owned before, it’s 5% down. That’s the difference. 

Tim Ulbrich  27:30

And we have all of this more information on our website. If you go to yourfinancialpharmacist.com/ home-loan. We’ll link to that in the show notes. As well, you get more information on the pharmacists home loan product and offering. We also have a form that you can fill out quickly there that will get you connected to Tony and his team to learn more as you’re looking at options. Whether you’re in the Hey, I’m ready to buy now, or I’m thinking about buying in six months, make sure to check out those resources and fill out that form so we can get you connected to Tony and his team. Tony, this has been great as always. Really appreciate your perspective. The other thing I just want to say to our community, if you have a question, you know, whether you’re buying, selling, thinking about buying and selling in 2024, you have a question that you’d like us to tackle. We’re gonna be bringing Tony back on the show here in a couple of months. Just send us an email [email protected]. In the subject line, just put home buying, home selling question, and we’ll make sure to tee that up for Tony on a future episode. So Tony, thanks so much for taking time to come on.

Tony Umholtz  28:24

Hey, thanks for having me. Tim. Great seeing you. 

Tim Ulbrich  28:26

You too. Take care.

Tim Ulbrich  28:29

Before we wrap up today’s show, I want to again thank this week’s sponsor of the Your Financial Pharmacst Podcast, First Horizon. We’re glad to have found a solution for pharmacists that are unable to save 20% for a down payment on a home. A lot of pharmacists in the YFP community have taken advantage of First Horizon’s pharmacist home loan, which requires a 3% downpayment for a single family home or townhome for first time homebuyers and has no PMI on a 30-year fixed rate mortgage. To learn more about the requirements for First Horizon’s pharmacist home loan, and to get started with the pre- approval process, you can visit yourfinancialpharmacist.com/home-loan. Again, that’s yourfinancialpharmacist.com/home-loan.

Tim Ulbrich  29:12

As we conclude this week’s podcast an important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information to the podcast and corresponding material should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. Furthermore, the information contained in our archived newsletters, blog posts and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of Your Financial Pharmacist unless otherwise noted, and constitute judgments as of the dates, publish them. Such information may contain forward looking statements, which are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer. Thank you again for your support of the Your Financial Pharmacist podcast. Have a great rest of your week.

[END]

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YFP 347: Redefining Retirement with David Zgarrick, Ph.D. (YFP Classic)


Dr. David Zgarrick, retired professor, redefines retirement after 30+ years in academia and shares insights on embracing a fulfilling post-pharmacy life.

Episode Summary

This week on the YFP Podcast, we revisit a classic. On episode #291, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, welcomed Dr. David Zgarrick, a Professor Emeritus of Northeastern University, to the show to discuss redefining retirement. Some highlights from the episode include Dr. Zgarrick sharing his views on his next phase in life, after 30+ years in academia, as a preferment phase of his career. He shares how and why he started planning for his financial future early on in his life and career and hands down advice for new pharmacy graduates facing competing financial priorities. Throughout the discussion, listeners will hear Dr. Zgarrick speak on standout moments from his pharmacy career, the impact his financial choices have had on that journey, and ultimately his decision to enter this preferment stage of his career. He shares excitement for retirement and this next phase of his life, what he means by a preferment phase, and how retirement can be an opportunity to experience a rich, fulfilling life outside of pharmacy without the guilt of competing responsibilities. Listen for helpful advice Dr. Zgarrick took from his financial advisor regarding his first year of retirement and how factoring in a cross-country move played a role in his retirement and financial plan.

About Today’s Guest

David P. Zgarrick, Ph.D., is a Professor Emeritus in the School of Pharmacy and Pharmaceutical Sciences at Northeastern University. His prior positions include Associate Dean of Faculty at Northeastern’s Bouvé College of Health Sciences, Acting Dean of Northeastern’s School of Pharmacy and Pharmaceutical Sciences, Chair of the Northeastern’s Department of Pharmacy and Health Systems Sciences; John R. Ellis Distinguished Chair of Pharmacy Practice at Drake University College of Pharmacy and Health Sciences; and Vice-chair of Pharmacy Practice at Midwestern University Chicago College of Pharmacy. He is a licensed pharmacist, receiving a BS in Pharmacy from the University of Wisconsin – Madison and a MS and Ph.D. in Pharmaceutical Administration from The Ohio State University. Dr. Zgarrick taught pharmacy practice management and entrepreneurship in the health sciences. His scholarly interests include pharmacy workforce research, pharmacy management and operations, pharmacy education, and development of post-graduate programs. He has published over 150 peer-reviewed manuscripts and abstracts, is co-editor of the textbook Pharmacy Management: Essentials for All Practice Settings (5th Ed), and authored the book Getting Started as a Pharmacy Faculty Member. He was editor-in-chief of the Journal of Pharmacy Teaching, Executive Associate Editor of Currents in Pharmacy Teaching and Learning, and an editorial board member of Research in Social and Administrative Pharmacy. Dr. Zgarrick is active in many professional organizations, including the American Pharmacists Association (APhA) and the American Association of Colleges of Pharmacy (AACP). He served on AACP’s Board of Directors for 12 years, including as Treasurer from 2016 – 2022. Dr. Zgarrick also serves on the Board of Visitors for the University of Wisconsin School of Pharmacy, the Board of Grants for the American Foundation for Pharmaceutical Education, and is a Fellow of the American Pharmacists Association.

Key Points from the Episode

  • Why David views the next phase of life after 30+ years in academia, not as a retirement, but rather, as a preferment phase of his career.
  • How and why he started planning financially early in his career to put himself in a position of having choice.
  • Advice he has for new grads that are facing the financial headwind of many competing priorities including student loans, saving for the future, and buying a home.

Episode Highlights

“I think when one thinks about getting to this stage in a career, I mean, there’s been so much that’s been rewarding and interesting about the work that I do. But like anyone, none of our career paths or jobs are perfect. They all come with sometimes things that we would just assume not be doing. Or the longer we’ve been doing something, we get to know ourselves pretty well.”  – David Zgarrick, Ph.D.

“Money is a means to an end. It is not an end in and of itself. The same as our career. We have to think of our career path as a means to an end. Not the end in and itself.” – David Zgarrick, Ph.D.

“I remember one time you posted on one of your blogs or something, what’s the most fun thing one can do when you’ve got some extra money? And I think I remember my comment to that post was: save it. And to some people that might not seem the most exciting thing in the world. But when I can take that money and put it in the bank, that tells me that I’m going to have that for – I’m going to be able to make decisions in a future based on having made that decision now to save that money. And it’s going to give me options that I know other people might not have if they didn’t save that money.” – David Zgarrick, Ph.D.

“We have money and we manage our money because we want to be able to live a life that’s meaningful to us. And however that is, I’m not here to judge how one spends their money or what one does with their money. So long as you’ve got the money to be able to do it, that’s our choices. It’s your choices to be able to do that how you wish.” – David Zgarrick, Ph.D.

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[00:00:00] TU: Hey everybody, Tim Ulbrich here, and thank you for listening to the YFP podcast, where each week we strive to inspire and encourage you on your path towards achieving financial freedom.

This week, I had the pleasure of welcoming Dr. David Zgarrick, a professor emeritus of Northeastern University College of Pharmacy. Some of my favorite moments from the show including hearing Dave share why he views the next phase of life after 30-plus years in Academia not as retirement but rather as a preferment phase of his career. How and why he started planning financially early in his career to put himself in a position of having choice? And advice he has for new grads that are facing the financial headwind of many competing financial priorities, including student loan debt, buying a home and saving for the future. 

Now, before we jump into the show, I recognize that many listeners may not be aware of what the team at YFP planning does and working one-on-one with more than 280 households in 40-plus states. YFP planning offers fee-only high-touch financial planning that is customized to the pharmacy professional. If you’re interested in learning more about how working one-on-one with a certified financial planner may help you achieve your financial goals, you can book a free discovery call at yfpplanning.com. 

Whether or not YFP planning’s financial planning services are a good fit for you, know that we appreciate your support of this podcast and our mission to help pharmacists achieve financial freedom. 

Okay, let’s jump on my interview with professor emeritus Dr. Dave Zgarrick. 

[INTERVIEW]

[00:01:29] TU: Dave, welcome to the show.

[00:01:30] Dr. DZ: Thank you. Thank you. It’s great to be here, Tim.

[00:01:33] TU: Well, I’m really excited to have you on to dig into your professional journey and the impact that finances has had throughout your journey so that you could retire or perhaps better said, as we’ll talk about, take a half-time break at the age of 57. And you and I have known each other for several years through the academic circles. And when I saw your post on LinkedIn about entering this next phase, I knew that your story would have such a great impact on our community. So, thanks so much for coming on the show.

[00:02:00] Dr. DZ: Thank you. Thank you so much for having me. I’m really great to be here. And it’s great to think about half time. It was interesting, I’m a Green Bay Packers Fan. You’re a Buffalo Bills fan. Just thinking about half time. We’re about halfway through the NFL season. It’s time to make some adjustments. And I think both the Packers and Bills will have some adjustments to make. And so, we can talk about how we make financial adjustments as well.

[00:02:22] TU: I love that. I love that. Let’s start with your pharmacy career. When did that Journey begin and what drew you into the profession to begin with? 

[00:02:31] Dr. DZ: I’m from an interesting community. I’m from Marshfield, Wisconsin, which is a relatively small community in Central Wisconsin. But it’s a very unique community and that Marshfield has a very large medical center. It’s the Marshfield Clinic. It has now the Marshall Medical Center. 

I grew up with health and healthcare even though no one in my family was a healthcare professional. My father was an administrator for a dairy corporation. My mother is an educator. She taught special education. I was not brought up in a healthcare background. But I had lots of friends and knew lots of people that were in the healthcare space. 

And as I was going through high school, I was thinking about health and healthcare a lot and thinking about wanting to go down that pathway. I was reasonably good at all the things they tell you you’re supposed to be good at in high school, math and science, and communications and all those things. 

I had honestly probably was thinking first about medicine at the time. I was going to go to medical school. I guess, in some ways I was very fortunate. I went to a career day seminar and one of the speakers that came to that career day seminar was someone from the University of Wisconsin School of Pharmacy. And talked a little bit about pharmacy and what pharmacists did and so forth. And pharmacy hit a good spot. 

And again, I’ll give my parents credit. They were very pragmatic with me when it came to where are you going to go to college? And what are you going to major in college? That kind of stuff. And they were said, “You know, you can go to college anywhere you want. And you can major in anything you want so long as you can support yourself when you’re done.” 

And to that end, pharmacy seemed it was a great at the time. Keep in mind. It was a five-year BS degree at the time, which was a great fit. Because in some ways I’m thinking, “Okay, I’m going to learn all these things that are going to help me if I go to medical school. Become a physician. I’m going to learn a lot about drugs, and a lot about health and health care and so forth.” Worst case scenario, if I don’t get medical school, I could be a pharmacist and I’ll be able to support myself. 

I’ll say two things happened along the way. One, I recognized that being a physician wasn’t all it was cracked up to be. And especially the pathway towards becoming a physician. It’s not just medical school, of course. It’s residency and training and everything that that life brings. And then I also learned that there’s so much more to pharmacy than I had envisioned there was. Probably many people, when you start down this path. Growing up in Central Wisconsin, honestly, my only connection with pharmacy was with community pharmacy. 

I saw people, primarily men, wearing white coats working behind counters and seeing them take big bottles of pills and put them into little bottles of pills. And didn’t think that much more of it. Obviously, as I learned so much more of about not only what the role of pharmacy was at that time but what we were seeing it begin to evolve to. Towards not just dispensing medications, of course, but really using our knowledge and expertise to help maximize the benefits from medication therapy.

I was fortunate. I had some really good experiences along the way. I hooked up with folks that were doing research in a variety of different ways. I spent one summer doing medical research working in a lab. And honestly said to myself, “That’s not what I wanted to do.” 

But I spent more time doing research with social administrative scientists and learning about the kinds of questions that they asked. My parents will tell you I am one of those people that always ask questions. I was one of those always kids that always asked, “Why? Why? Why?” 

And as you can imagine, parents, you being a parent yourself, you’re probably – at a certain point, you just want to tell your kids go figure it out yourself. Because, honestly, that’s what we do as researchers. We ask questions and we have the tools to be able to learn how to figure it out ourselves. 

Now, my questions I was very interested in asking were honestly about pharmacists themselves. The work they do. How they’re rewarded for that? What their ambitions are? Where they see themselves going with their careers? As a pharmacy workforce researcher, my interest is very much in who pharmacists are and what they want to do with that pathway. 

And so, I got my pharmacy degree from Wisconsin. I went and worked as a community pharmacist for several years. Worked for a company that’s called Shopko. Unfortunately, Shopko is no longer with us. But many of us probably remember what Shopko was. And for a number of years, they were a great place to work with because I really used my knowledge as a pharmacist and as a pharmacy manager working for Shopko. 

But then went back to – went to Ohio State for graduate school. That was a good place to be able to go to be able to learn the research tools that I needed to have to be able to do the research that I do is. As well as to get more experience with teaching and educating. 

I had gotten some experiences as a teaching assistant, as an undergraduate student at Wisconsin already. But then at Ohio State, I got even more experience and learned what it was like to be in part of a classroom of 100 students and have to be prepared and have to help students understand how does their knowledge of this particular topic fit into a bigger picture of all of the things that we expect them to know as a pharmacist? 

As I finished up my graduate work, I had options. I could go work for the pharmaceutical industry. I could go work with a managed care organization. I could work with wholesalers like Cardinal, or McKesson, or Bergen or something like that. There were lots of options. 

Ultimately, I chose the academic path because I really enjoyed that ability to not just continue to do research but to connect with students and to really – it felt that I could have the biggest impact in my profession. And ultimately, the biggest impact on patients by continuing to train and help educate the next future generations of people that are going to go into pharmacy.

[00:09:00] TU: I love that, Dave. And you would ultimately spend 30-plus years across three different institutions in that area of work and I know have had an impact on so many other colleagues that you’ve crossed path with, obviously, the thousands probably of students that you worked with over the years. 

[00:09:17] Dr. DZ: It’s interesting. At this point of one’s career when – yeah, one naturally does kind of look back at those types of things. And I started adding up the numbers between the institutions I’ve taught. And I’ve been the professor of probably close to 5,000 students over the years. I’m editor of a textbook and I work with several others on that book as well that I know is used in most colleges of pharmacy in the United States. And including not many colleges of pharmacy across the world. And so, it’s kind of cool to think about how one has an impact not necessarily even just directly like we are used to with our patients. But that indirect impact that the work that we do can be used by so many people. 

[00:10:01] TU: One of the reasons I was so excited for this interview, Dave, is that I think there’s often a perception around retirement that folks might be limping towards that line. Or begrudgingly working late in their career. Or there’s a lot of energy around early retirement. But often, I think that’s with the context of that someone may not necessarily be enjoying the work that they’re doing. 

And what’s really interesting about your story is the great career you have had. The fulfillment and joy you had in your work. The impact you had on many others. But also, this excitement around the next phase of life. And to me, that is what – when we talk about preferred retirement, when we talk about what retirement may look like and the vision of like that, that to me is the success I know that I’m yearning for, is to have an option and choice, of course. But also, to look back and feel like, “Wow! I love the time that I had and the impact and the opportunities I had.” 

And you shared something really interesting on LinkedIn. You said that, “While I may have concluded the pharmacy educator phase of my career, I certainly don’t think of myself as being done.” And to borrow a phrase from Lucinda Main, someone we both know. You said you’re entering the preferment phase of your career. Fortunate to have the luxury of choosing what you’d like to do. Who I’d like to do it with? And taking the time to figure it all out. I love that, the preferment phase. Talk to us more about what that means to you.

[00:11:31] Dr. DZ: Thank you so much, because I feel so fortunate to be able to be at this phase of my career. And I want to share my wife, Michelle, who’s also a pharmacist who I met in graduate school at Ohio State. She has also started at her preferment phase as well. She was a pharmacist. Worked in the hospitals and outpatient oncology settings for many years. And has decided to start her preferment stage at this point with us. 

But, no. I think when one thinks about getting to this stage in a career, I mean, there’s been so much that’s been rewarding and interesting about the work that I do. But like anyone, none of our career paths or jobs are perfect. They all come with sometimes things that we would just assume not be doing. Or the longer we’ve been doing something, we get to know ourselves pretty well. 

And I say to myself, “Well, these are things that I really like that I’m really interested in.” And then there’s other parts of my job that I’m doing that, “Well, I’m not so interested in those things.” And I’m just doing them because at a certain point you kind of feel you have to. And I guess this is, again, a good position to be able to be in. 

When one thinks about preferment, I mean, yes, I stepped off in academia what we call the tenure track. I was a tenured full professor, which in many respects is the ideal position. It’s the golden ring that many people go towards. This idea that you have a lifetime contract. And I was very fortunate to have a lifetime contract at a leading university and was well-compensated for what I did. I’m very fortunate to have been in that position. 

That said, if you’re staying in that position, you’re going to keep doing all of those things essentially for the rest of your career. And I just kind of said to myself, “Maybe not.” Maybe there are other things I’d like to do. Again, there’s things I like doing. There’s things that I don’t like doing. And then there’s this whole outside of my job life, the things that make me, so to speak, that I kind of wanted to think I’d like to be able to do them without feeling guilty that I should be doing something else. And so, no, I decided that this was a good point in my life to be able to make this type of change. 

[00:14:01] TU: Mm-hmm. Yeah, and I think – No pressure, Dave. But I think you and maybe Lucinda should work on a book on the preferment phase. Because I think – and we try to find this balance. But we focus so heavily on the dollars and cents, right? Really important. We got to have enough to cover our needs and the goals we have. Whatever those may be. But we tend to overlook both in retirement as well as throughout our careers. What does it mean to live a rich life? Not just dollars and cents. But at the end of the day, money is a tool, right? 

[00:14:34] Dr. DZ: Oh, exactly. Exactly. I couldn’t agree with you more. Money is a means to an end. It is not an end in and of itself. The same as our career. We have to think of our career path as a means to an end. Not the end in and itself. 

Again, when I stepped back and thought about that, I think about my family. And it was difficult sometimes especially during the pandemic. I mean, my family was back in the midwest, in Wisconsin, in Chicago and so forth. And there was a long time where we literally couldn’t travel to go see them. My wife’s family was in Ohio. The same thing. My wife was working at a hospital and they’ve literally told her, “Well, if you leave the state of Massachusetts to go visit your family, you have to quarantine for two weeks before you come back to work. And that, just for a long time, wasn’t viable for either of us. 

We started thinking about our families. We started thinking about the things we enjoy doing. I mean, I enjoy skiing. I enjoy getting out on my bike and going on rides and that kind of stuff. And some of the mental type things that we all like doing and so forth. The things that honestly make us us. 

I look to this point of life that we’ve entered now where it’s giving us more space and time to be able to do that and not feel like, “Oh, I’ve got to do this job aspect of my job or that aspect of my job.” I mean, we’ve figured out ways to be able to manage that.

[00:16:09] TU: One thing I mentioned to you before we recorded is I’m reading right now a book called Retirement Stepping Stones by Tony Hixson. We’ll link to that in the show notes. And this was recommended to me by a shared colleague that really John [inaudible 00:16:23] said, “Hey, Tim you got to read this book,” to really have perspective on what he and I were talking about at the time, which is more this concept of life planning. Again, need the dollars and cents. But also, what are the goals? What’s the vision we have to live life well? 

And Tony Hickson, in this book, talks about retirement not as a finish line but how we need to be thinking about as a half time. And I love that. Because what do we do at halftime, right? You already kind of mentioned it when our Bills and Packers played. You adjust. You adjust and you have a plan. 

Yes, it’s been informed a little bit by what’s been happening. But it’s a time to reset, to look ahead and to make sure we have a plan. We don’t just go out into the third quarter and hope it’s going to work out, right? 

My question for you is it’s clear to me, Dave, when I hear you talk talking about investment of more time with family, with the outdoors, and skiing and traveling. That there’s these other goals. But there’s been thought and intention behind this transition. And talk us through that a little bit more and how you and your wife got to this decision point and ultimately painted the picture of what this vision would look like.

[00:17:28] Dr. DZ: Yeah, I think for many of us – I mean, in some ways, it’s been a conversation we’ve thought about for a long time. I mean, we knew from this point that we started working that someday we were going to retire. We weren’t just going to stay chained to our desks, or to our hospitals, or universities forever and ever. 

We knew that that day was going to come. We didn’t necessarily know when that was going to be. But we started saving and thinking accordingly for that knowing that it would come. And so, there was an aspect of having a financial plan that we started to put in place. 

Moving forward, I’ll say, like many people, we did get to the pandemic and kind of said to ourselves, “As our jobs were changing and our careers were changing, are these changes we wanted to make –” I mean, in some ways we made them because we had to. We all adjusted and so forth. But did we want to continue down this pathway? And I think we put some thought and energy into this. 

And then now, I’m going to say we also sat down with a financial advisor. And actually, I’m going to mention just a little bit thinking about finances. Because, of course, there is a financial aspect to be able to make these decisions. Like I said, my wife and I had started saving. And we are savers. That’s part of our culture. 

I remember one time you posted on one of your blogs or something, what’s the most fun thing one can do when you’ve got some extra money? And I think I remember my comment to that post was save it. And to some people that might not seem the most exciting thing in the world. But when I can take that money and put it in the bank, that tells me that I’m going to have that for – I’m going to be able to make decisions in a future based on having made that decision now to save that money. And it’s going to give me options that I know other people might not have if they didn’t save that money. 

Like I said, we were pretty good savers. That said, we didn’t have – let’s say, we didn’t have a sense of when halftime was or how we were actually going to go about making that decision. And so, in some ways I was really fortunate that a financial planner, so to speak, somewhat fell into my lab. 

My parents had set up a life insurance policy for me when I was born. Like, many families do with their kids. And it was a whole life policy that had a relatively small cash value. But let’s just say a number of years later somebody from that company reached out to me and said, “Have you thought about your retirement and retirement planning?” And for years I just kind of put them off thinking, “Oh, you’re just somebody trying to sell me more insurance or something like that.” And didn’t pay much attention to them. 

But then, ultimately, we just kind of – I’ll give him credit for his persistence. But every year, he came back and touched base. How’s things going and all that kind of stuff? And then ultimately kind of said – it kind of hit me that, “Yeah, I could really benefit the perspective from somebody like this.” 

Because like I said, I’ve done – I’m a pretty informed investor so to speak. I’ve done a pretty good job of saving and thinking about where my money was going to go, and making our money work the best for us and all that kind of stuff. But that still doesn’t give us necessarily a sense of when can you say it’s half time? And when can you make that decision? 

Tom, our financial advisor, really helped us with that thought process. And I’ll say I remember this very well because it was January 2021. We’d all been living through the pandemic for the better part of that year. And he just kind of sat down with us and said, “Well, okay, given what you’ve saved to this point, if you guys decided today if you wanted to not continue to do the jobs you’re doing right now and start living off of your savings based on the lifestyle that you have, of course. The spending patterns that you have and everything. He told us, essentially, you could live within – you could live to be 95 and you have a 95% chance of not running out of money. And we kind of thought to ourselves, “Wow! That’s a really good thing to hear.” 

And just having that conversation really kind of opened up our eyes to, “Well, what could we do? What are the things?” Not so much the things that we felt like we had to do, but what do we want to do? Where could we go from here? And I think that’s where we really started saying, “Okay, this is – we’re going to start moving down this path.” 

I mean, I didn’t – needless to say, didn’t immediately go to my boss and say I’m leaving. We had a very good conversation about how this was going to look. And honestly, it was more than a year and a half after I had that conversation. I didn’t officially retire from Northeastern until this past August. We had that conversation. My wife had that conversation with her folks at our hospital. And then we started planning for what our next phase of our life is going to be. 

We started thinking where do we want to be? Do we want to stay in the Northeast? Or do we want to start thinking about other parts of the country that we might want to live in and so forth? We landed on Denver is where we decided we wanted to be. We started going through the work of preparing to sell our places in the Northeast and find a place to live in Colorado. 

And I’m going to add real estate to that mix of your financial picture that you go through in making these decisions about what your total financial picture is. Because we’ve always thought of our homes not just as a place to live but as an investment that we are going to buy and hopefully sell for more than we paid for them at some point. 

But we went ahead and started making those decisions and putting that into motion. And as of last March, or this past March, we made the move from Boston to Denver. nd I’ve been very happy that we made that move. It’s worked out very well for us.

[00:23:59] TU: Let me ask for, I suspect, some pre-retirees that are listening thinking, “Ugh! Dave, I love the story and the journey.” Maybe they even look at their numbers and say, “I think it’s there.” But then they are living the reality of 8%,9% inflation, market volatility. There’s so much discussion out there of when you retire and what the market’s doing can have a long-term impact on returns and how you mitigate that risk around retirement. Talk us through – for you, obviously, we can plan scenarios. I don’t know if any of us were planning for this type of inflation volatility.

[00:24:35] Dr. DZ: Well, that’s a really good point. And believe me, I’ve had some thoughts about what we’ve gone through and in terms of the timing. I mean, when I think about even what the environment was back in early 2021 where in some ways, yeah, the stock market was starting to come back pretty strong at that time. Inflation was still pretty low. Interest rates were really low. 

One of the things – Needless to say, we go into an environment now. One of the things my financial advisor advised us of. And I can’t begin to tell you what a good piece of advice this was, was to be reasonably liquid going into what essentially will be your first year of – I’ll keep using the word preferment because I’m just not convinced that I’m retired. 

But he said, “Basically, you want to have a year’s worth of spending money, liquids, such that you don’t have to sell stocks in order to be able to have money to live on essentially.” 

And I’ll say this, it was actually relatively easy for us to be able to do that not just with some of our financial instruments that we had been using. We used them for a variety of instruments. I mean, from equity, to bonds and other types of things that everyone else uses. But again, this was the aspect of buying and selling real estate. We owned two properties outright in Massachusetts – one in Massachusetts. One in Maine. And when we sold those, we were able to purchase a home in Denver, as well as have a little bit of cash on hand. 

And having that cash on hand has made things a lot easier. Now, no one likes 8%, 9% inflation of course. And it’s certainly taken a little bit of a bite out of that cash at hand. But it’s also saved us from having to go and sell stocks at a time where stocks have taken like in the past year – What? A 20% dive. 

The one thing, thinking about stocks – I mean, I have confidence that the markets will come back. I’ve seen markets go down before and they’ve always come back. And looking at our economy and the things that underpin it, the market will come back. I don’t know exactly when and how it will. If I knew that, I probably wouldn’t be doing the preferment thing. I’d be making a lot more money as a financial advisor. 

But anyway – but I had that confidence that it will. And with that confidence I know that essentially the way we have things structured, this combination of different assets that we’re utilizing to be able to make these decisions. It’s not just one type of asset class that you look at. It’s not just your 401k, for example. There’s a variety of different ways that we can get to what we’re doing. 

And you know what? Another thing, just to get to think about this preferment thing, too. I mean, preferment does not mean not working or no income. It’s likely going to mean different types of things. I mean, I’ll say, as I’ve moved into this phase, I’m doing what most of us would call consulting work. I’m working with a couple of different universities right now. I want to add some teaching stuff. I want to add some more administrative stuff. Helping them deal with some issues that they’re dealing with and so forth. 

And, again, just utilizing the expertise that I’ve developed over the years to be able to do some things. I mean, it’s bringing in a small amount of income. Definitely not as much as I was making when I was working full-time. But that’s okay. I don’t need as much as I was working full-time. 

My wife’s in the same position. I mean, she is a pharmacist. She could go back and work as a pharmacist. I mean, especially right now, there’s lots of demand. She could. I don’t actually know if that’s really what she wants to do. She’s been telling me that her next job may be working at a Trader Joe’s. And for her, that, again, this could be the perfect thing for her.

[00:29:02] TU: Store discount. Bonus. Right? 

[00:29:03] Dr. DZ: Exactly. Exactly. Believe me, that comes in handy. But again, that’s the sense of my wife and I were both very money pharmacists. We were well-compensated people. We were not hurting for income. But I just took a step back and said, “I don’t need or even want to live my life where I have to depend on having that level of income for the rest of my life. I just looked at it and said, “I can do the things I want to do and live a very good life on not having that level of income.” 

[00:29:44] TU: Yeah. And that takes me – Dave, I’ve been thinking as you’re talking, you’ve said several things that have caught my attention. Your somewhat inherent behavior around saving. Really, this mindset around, “If I had an option to spend extra money, I’d save it because I could think about the growth and delay gratification into the future.” And those are a sneak peek into a mindset around how we think about and how we handle our money. 

And it feels like, as you’re talking, that this is something that has been ingrained in you for a long time either through personal interest, research, family experience, whatever may be the case.

[00:30:20] Dr. DZ: We were talking a little bit about this before we came online. I mean, it’s almost fair to say I’ve been thinking about this essentially from the time I was born. Because I was born into a family of savers essentially. I like to use the example of my folks – again, like I said, my father was an accountant who went to work in the dairy industry in Wisconsin. And my mother was a teacher. Between the two of them, they had a decent middle-class income, of course, and everything. But again, always saved. Part of it was to be able to save to send myself and my two brothers to college, which again I cannot begin to tell you how fortunate I was to be able to have parents who had saved for our college education and then gave us that ability to be able to start our lives without the debt that I know that many of our students have today as they’re getting that education. That, again, I know that I was so fortunate. And I’m very thankful to my parents for that.

But even more than that, it created a mindset in me that I saw what they did to be able to not only to provide a college education for me and my brothers, but to create the life for themselves as well. And my dad also retired at the age of 57. And now, – And again, retirement for him wasn’t retirement. It was. And I’ll still say is. Because my dad’s 82-years-old and is still doing this. It’s very much preferment. 

My dad was – Like I said, he’s an account who had always specialized in tax. And while he was working in the dairy industry, he started doing people’s taxes during tax season. And then when he decided he didn’t want to work in the dairy industry anymore, he just said, “Well, what am I going to do?” He just essentially start – his side gig has been doing taxes. And he still has about 200 clients to this day, including myself. 

[00:32:32] TU: In his 80s, right? 

[00:32:32] Dr. DZ: In his 80s. It is that – I’ll say for this. It’s that great mental thing for him. It keeps him very engaged. A matter of fact, every year, this time of year actually, he goes back to tax school. It’s like a one-week seminar that he goes and learns about like, “Okay, what are all the new tax codes?” and all the new things that he needs to be able to work with people as a tax advisor on and all that kind of stuff. 

And so, every year he goes to just that. And every year he shares it with me and tells me what I should be doing and how I should be preparing myself financially and that kind of stuff. But again, I just give so much credit to my parents because they had instilled in me mindsets about the value of saving and about just think about your finances really is just another one of our tools in our toolbox so to speak. It’s not an end of in itself. It’s a means to an end. 

We have money and we manage our money because we want to be able to live a life that’s meaningful to us. And however that is, I’m not here to judge how one spends their money or what one does with their money. So long as you’ve got the money to be able to do it, that’s our choices. It’s your choices to be able to do that how you wish. But it’s just having those tools and having that mindset to be able to make those decisions has been a really great thing. 

I remember probably likely somebody we both know, Karen [inaudible 00:34:13]. I went to graduate school with Karen back at Ohio State. She introduced me back, and I want to say this was probably 1990, 1991, to this little financial tool called Quicken. 

And I have to think back. Back in 1990, ’91, I don’t know if you remember the Macintosh computers that were literally like these cubes. And so, I got one of the first versions of Quicken for Mac that was – it started – And honestly, it was this way of tracking your finances. Tracking how you use your money. Doing the checkbook thing but doing it on the register on Quicken and everything. And then the fact that it keeps track of everything. 

I mean, I’m pretty proud to say now, I – what is it now? 30 some years later, I have – I still use Quicken to this day. And I have a record of my financial transactions that goes back over 30 years. And that’s been valuable to me. I mean, I can’t say that I go back and look at every transaction from 1992. But it does tell me when – let’s say if my financial advisor wanted to know, “What kind of money do you need to live on?” so to speak. Well, I had that data. I could get those answers relatively easily. And that’s been – Again, one of my bits of advice is whether it be Quicken or any of the other tools out there that help us get in that picture of ourselves financially, utilize those tools. I say I probably put one to two hours every other week into managing my various aspects of my finances. And for me, that’s always been time very well spent.

[00:36:14] TU: Yes. Yeah. And the consistency and compound effect of that is huge over time. And it’s interesting, you’re talking about tools and Quicken. Here in 2022, obviously, there are more tools than ever, apps, that will help us, software tools. But I would argue, some of the mindset and behavior, it is getting harder and harder just because of all the things that are competing – 

[00:36:39] Dr. DZ: Or time and attention.

[00:36:40] TU: Yeah, tracking, easier execution I think is even becoming a little bit harder. Let me ask you one final question. I know we have some new practitioners that are listening. You obviously work closely with students and new grads as well. But folks that are feeling the headwind financially despite obviously making a good income, having a good potential for their income into the future but they’re facing large student loan debts. They’re looking at potentially the housing market and wanting to buy a home in this market. Inflation. Tim and Dave, you’re telling me I need to start saving early and max out my retirement accounts. I need an emergency fund. I need to get rid of my credit card debt. Just overwhelming, right? What advice would you have for those folks about some of the early wins and behaviors and habits that they can employ? 

[00:37:32] Dr. DZ: I think you nailed it right there. Early wins. One step at a time. Rather than getting overwhelmed by all of these things that are hitting you. Focus on one thing that you can do that you can impact. 

Yeah, a good example would be like my wife. Or my wife and I, shortly after we got married, she did have a little bit of college loan debt. And she was somebody – she had gotten a bachelor’s degree. She went to graduate school. And then she decided to go to pharmacy school. And so, it took her a little longer to go down that path. And she had a little bit of financial debt. We decided to focus – to prioritize on paying down that debt. It was the highest interest debt that we had. 

And we did the things that we had to, which in the short term, yeah, everyone probably meant making some sacrifices. There were some vacations we didn’t go on. Maybe we bought the used car rather than the new car or something like that. There are all the little things that one does to be able to then have a little bit more money to put in the areas that you want to prioritize. 

So, whether it’d be paying down student loan debt, or sitting to make a down payment on a house, or all the other things. I mean, the great news is, as pharmacists, we are relatively high-income folks. We have access to funds. It’s just a matter of how we decide to utilize those funds. 

But, yeah, should focus on that one thing. Don’t get overwhelmed by all of the different things and thinking to myself, “Oh, gosh. There’s so much going on here. How am I going to handle all of this?” You can handle things. Do one thing at a time. Then use that leverage, that success you have in doing one thing. So, then go do the next thing. 

[00:39:22] TU: Yeah, I love that, Dave. I talk a lot with new practitioners about that early momentum. And while any one financial decision or win may not feel monumental in the moment, it’s the compound effect in the momentum that comes from that over time. And there’s a natural excitement of like, “Okay, small win. What’s next?” Another win, what’s next? What’s next? And you look back three, five, ten years later, and some of those behaviors start to really compound and add up over time. 

[00:39:49] Dr. DZ: Oh, that’s the one thing. I remember back, I was thinking in high school, you learn about compound interest. And the idea that interest builds on interest builds on interest. And again, I think about 30, 40 years into my career span, so to speak. The decisions we made very early on are definitely paying dividends today and how they do things. 

Now, that said, I also don’t want to turn off or upset your readers who maybe aren’t that young anymore or maybe thinking of themselves, “Gee! I didn’t do that when I was you know 25-years-old. What am I going to do?” It’s never too late to start. And there’s a lot that one can do to make good financial decisions even – again, another really good habit I picked up from my parents is while I have credit cards and use them liberally, it’s with the sense of never – my dad just instilled in me. You will pay off your credit card in full every month. You will never carry a balance on these cards. 

And that’s, again, always just been part of my mindset, that I use a credit card. I get that bill out of it every – Actually, I don’t even get a bill obviously. Everything’s electronic these days. And honestly, it’s automatically withdrawn from my checking account. But I – essentially, I use the credit that’s available. Credit is not necessarily a bad thing. I’m not one of these people who will say never use credit cards. Or don’t take out interests. And don’t take out loans. I mean, heck, a lot of us, the reality is we wouldn’t go to college. We wouldn’t be able to buy a home if we didn’t take out debt. Debt can and is a good thing. It just has to be used in balance with everything else. Because if it’s not in balance, it will take over in a not so good way.

[00:41:55] TU: Well, this has been fantastic. I knew it would. And it’s delivered. And I’m excited to get this out to our community. And really excited, Dave, for you in this next phase of your preferment. I think I’m going to adopt that term. 

[00:42:09] Dr. DZ: That’s a great thing. I do think Lucinda and I should get together and write a book on preferment. But as always, one of the great things about being an educator is – you know, Tim, is you – it’s not just the impact you make on students when they’re in your classroom. It’s the impact you see as their careers move forward. 

And I’ve been so blessed and fortunate to be able to stay in touch with many of my former students and not only see the successes they’re having and the things that they’re achieving in their lives, but to be able to share what we’re all doing and so forth. And to that end, I hope some of my former students are out there and are seeing this. And I would love to be able to stay in touch if there are things that I can share more with your listeners about how one prepares to get to the point in this life. The thing, decisions that we make as we get to this point. 

I will still say, keeping on our football analogy, it’s still half time. And my wife and I are sitting in the locker room still making those plans for what we’re going to go out and do in the third quarter. And just like I’m offering advice to some folks. I’m also appreciating advice from people who have been down this pathway ourselves. And whether it’d be books or whether it’d be other folks that have made similar decisions to what we have. There’s a lot to learn. And to me, that’s always been the best part about the academic path, is it’s not the teaching. It’s the learning.

[00:43:45] TU: Absolutely. 

[00:43:46] Dr. DZ: And the more that we can learn, the better off we’ll all be. 

[00:43:49] TU: Well, that’s great. We’ll link to, in the show notes, your LinkedIn if folks aren’t already connecting with you. I know that’s a way they can reach out. All right. Thanks again, Dave. I really appreciate it.

[00:43:58] Dr. DZ: Thank you. Appreciate it a lot. Thank you very much.

[OUTRO]

[00:44:01] TU: As we conclude this week’s podcast, an important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding materials should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. 

Furthermore, the information contained in our archived newsletters, blog posts and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of your financial pharmacists unless otherwise noted, and constitute judgments as of the date publish. Such information may contain forward-looking statements are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward-looking statements. For more information, please visit yourfinancialpharmacists.com/disclaimer. 

Thank you again for your support of the Your Financial Pharmacists podcast. Have a great rest of your week.

[END]

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YFP 346: Developing a Budget That Works…And You Don’t Hate with Tim Ulbrich


Tim Ulbrich shares the importance of setting a budget for achieving your financial goals and five steps to help you get started.

Episode Summary

In this week’s episode, we learn all about one of the key first steps to mastering your money: creating a budget. You’ll learn how to implement a budgeting system that not only works, but is also enjoyable. Tim Ulbrich, YFP Founder and CEO shares a practical five-step process to help you get started. A budget isn’t a restrictive tool, but an important instrument that can empower you on your journey toward financial well-being and help align your money with your vision for a rich and fulfilling life.

About Today’s Guest

Tim Ulbrich is the Co-Founder and CEO of Your Financial Pharmacist. Founded in 2015, YFP is a fee-only financial planning firm and connects with the YFP community of 15,000+ pharmacy professionals via the Your Financial Pharmacist Podcast podcast, blog, website resources and speaking engagements. To date, YFP has partnered with 75+ organizations to provide personal finance education.

Tim received his Doctor of Pharmacy degree from Ohio Northern University and completed postgraduate residency training at The Ohio State University. He spent 9 years on faculty at Northeast Ohio Medical University prior to joining Ohio StateUniversity College of Pharmacy in 2019 as Clinical Professor and Director of the Master’s in Health-System Pharmacy Administration Program.

Tim is the host of the Your Financial Pharmacist Podcast which has more than 1 million downloads. Tim is also the co-author of Seven Figure Pharmacist: How to Maximize Your Income, Eliminate Debt and Create Wealth. Tim has presented to over 200 pharmacy associations, colleges, and groups on various personal finance topics including debt management, investing, retirement planning, and financial well-being.

Key Points from the Episode

  • Budgeting for financial freedom. [0:00]
  • Pharmacist financial success and budgeting. [3:51]
  • Financial health check and budgeting. [7:32]
  • Setting a financial vision and budget. [11:40]
  • Budgeting methods for personal finance. [16:04]
  • Budgeting and financial planning. [20:54]
  • Budgeting and financial planning for pharmacists. [26:06]

Episode Highlights

“So I think it’s safe to say that most pharmacists didn’t spend six to eight plus years training to get into this profession, to work hard to find themselves living paycheck to paycheck.” – Tim Ulbrich

“So, if we can identify in advance what our goals are, and we can identify how much we have to allocate towards those goals, then the next step we’ll talk about is how to actually make sure we distribute them accordingly. All the sudden, we’re thinking in a way that we are pre funding our goals, right really important, rather than waiting to see what’s left over at the end of the month.” -Tim Ulbrich

Links Mentioned in Today’s Episode

Episode Transcript

Tim Ulbrich  00:00

Hey everybody, Tim Ulbrich here and thank you for listening to the YFP Podcast where each week we strive to inspire and encourage you on your path towards achieving financial freedom. This week, I’m digging into how you can develop a budgeting system and process that works and is one that you don’t hate. During the episode, we’re walking through five steps that you can follow to implement your own budget. But before doing that, we’ll discuss why it’s crucial to do a financial vitals check along with some vision setting to get clear on what it looks like to be living your rich life. 

Tim Ulbrich  00:32

Alright, YFP community, I’m really excited to invite you to our next webinar on March 7, at 8:30pm/Eastern: Budgeting Blueprint, What Zero Based Budgeting Is, Why It Works and How to Start One. This webinar is different than webinars we’ve done before. Not only am I gonna dive into the ins and outs of the zero based budget and the power behind assigning each dollar a job, but I’m going to be doing a live demo of a zero based budget using the YFP budget template. And we’re going to be anonymously featuring real pharmacists’ budgets for you to see. So here’s the deal. First, I want you to register for the webinar. It’s free, visit yourfinancialpharmacist.com/budgetwebinar to save your seat. Again, that’s yourfinancialpharmacist.com/budgetwebinar. Second, we’re gonna be giving away three $50 amazon gift cards to pharmacists who submit their budget to be featured and who attend the webinar live. Here’s how you can do that: you go to download your FREE zero based budgeting template at yourfinancialpharmacist.com/budget again, yourfinancialpharmacist.com/budget, then go ahead and fill out your budget with your numbers. If you’ve never used a zero based budget before, don’t worry instructions are included in the template that will help you walk through the process. Make sure to save your budget, send us an email with that budget attached at [email protected]. And make sure to include the word “budget” in the subject line so we can quickly identify your template. In the email, I would love for you to also share any additional information that would be helpful for me to know, whether you’re a single income earner, whether you have dual incomes in the household, if you have any children, where you live. And of course, if you have any other questions that you’d like me to answer as it relates to your budget template. Then make sure to attend the webinar live for your chance to win one of the three $50 amazon gift cards. If you don’t want to turn your budget, no problem make sure to register for the webinar and we’ll send you the replay if you can’t join us live. Can’t wait to see you there and see the real life budgets from pharmacists in the YFP community. 

Tim Ulbrich  02:37

Hi guys, Tim Ulbrich here. This week, we’re gonna be talking all about how to develop a budgeting system that works and hopefully is one that you don’t hate. Now if we’re being honest with ourselves, who gets a little nauseous when the topic of budgeting comes up? I mean, besides the future financial nerds out there, not many are a fan of the whole budgeting thing. Quote, “It takes too much time.” “I already know how much I spend.” “I don’t know how to make one and follow it.” “I’m afraid of what I might find when I track my expenses.” “I don’t like to be so restricted.” “I make enough money so I don’t need a budget.” These are just some of the most common reasons that I hear for all of the hate surrounding budgeting. So in that light, what if we thought of the budget instead as a mechanism by which we achieve our financial goals? It’s simply the roadmap. It’s the execution plan that we have for the vision for living our rich life. It’s the way that we’re going to achieve what we set out to achieve. Now what are the most common things I hear pharmacists say is, “Tim, I make a great income. But I don’t feel like I’m progressing financially.” And one of the greatest threats to a pharmacist long term financial success is believing that a six figure income equals financial success. That mindset I can guarantee you will hinder progress. And here’s why if you take the average pharmacists salary, a reasonable take home pay after taxes after health insurance premiums after any type of employer retirement contribution is about $7,000 per month, right, give or take. And if you assume the average student loan debt on a 10 year standard repayment, plus let’s just say a $400,000 home and interest rates today that adds up to about $4,500 per month or 65% of a pharmacist take home pay. Let me say that again. Between the average student loan debt and a $400,000. home on a 30 year mortgage. Right. I know some people live in higher cost living areas, some people live in lower cost of living areas. That adds up to about $4,500 per month of committed expenses or looking at it another way about 65% of that take home pay number that I just mentioned. That means we have about $2500 left each month for everything else, right all the other home related costs, property taxes, homeowners insurance, upkeep, of course food, clothing, car payments, gas, other debt payments, insurance premiums, additional savings, and not to be forgotten the more enjoyable discretionary expenses like vacation, experiences, eating out, giving, and so forth. So I think it’s safe to say that most pharmacists didn’t spend six to eight plus years training to get into this profession, to work hard to find themselves living paycheck to paycheck. Now, obviously, some pharmacist households have more than one income, so we have to factor that in. But regardless, we can see that the take home pay of a pharmacist only goes so far. And that’s why it’s critical that we shift the mindset that pharmacists make a great income. Yes, it’s a good income, one that is more than $50,000 higher per year than the average household income in the United States. So it’s a good income, objectively speaking. And so it’s a tool and it’s a pretty good one at that. But without a plan, it is going to have significant limits. So shifting your mindset around how much you make, and how far that income will go is the most important thing that you can do for your financial plan. Why? Because everything else will flow from that mindset, how you save, big purchase decisions, how you handle your debt, ideas for growing your income, and so on. So with that in mind, with the plan that we need to have one, right, we need to have some direction to make sure that we’re achieving our long term goals.

Let’s talk to you five steps to developing and automating a budget that works and hopefully is one that you don’t hate. Step number one is we have to do a financial vital check. Alright, before we get into the vision, before we get into the budget, we have to assess where we are at today. And sometimes this is painful. Sometimes this is exciting, right? Depending on the progress that we’ve made thus far. We need to really honestly assess are we on track? Are we ahead? Are we behind? And what does that even mean? And we don’t want to start running forward until we know where we’re at. And we want to find out what path we want to be running on. And a great starting point, certainly not the only place to be but a great starting point for the financial binos check is to really be tracking your net worth on a regular basis. Now, if you’ve been listening to the show, you’ve heard me talk about net worth many times before. Net worth is simply your assets or what you own, minus your liabilities or what you owe. And as I’ve shared often in my journey, paying off $200,000 of student loan debt and coming out of a significant amount of debt really into a period of trying to grow that net worth. This was a significant part of our journey, really shifting that mindset from income to being a tool, right income not being the end all to really being able to move that income to growing assets, paying down liabilities, and therefore growing net worth.

Now Dr. Tom Stanley in the book, The Millionaire Next Door, which if you haven’t read before, I’d highly recommend it. He says that one of the reasons that millionaires are economically successful is that they think differently. One of the reasons that millionaires are economically successful is that they think differently. And part of what he’s talking about here is this concept of income versus net worth . They recognize that income is a tool, but income by itself does not mean financial success. Now, what should be our net worth? Right? That’s an interesting question, what should be our net worth? And of course the answer that is it depends. But Dr. Tom Stanley in the book, The Millionaire Next Door gives us a calculation for expected net worth. And he says that your expected net worth is your age times your gross annual income divided by 10.

For example, if we had a 45 year old pharmacists making $140,000 per year, if we took 45 as their age, we multiplied it by $140,000 of income, we divide that by 10. That’s $630,000 would be their expected net worth for that 45 year old pharmacist making $140,000. Now in addition to net worth, that’s just one calculation. We certainly don’t want to hang our hat on that. There are other areas inside of this financial vitals check that we should be thinking about. Things like, where are we at with the emergency fund? Is that a box you’ve already checked? Is that something we need to focus on? Perhaps you looked at that several years ago, and now we need to update that because expenses have gone up. So where are we at with the emergency fund? That’s one part. Do we have revolving credit card debt? If so, typically, because of where those interest rates are we going to focus on that before we look at other parts of the plan. Have we landed on, for those that have student loans, have we landed on an optimized student loan repayment strategy? Critically important, many different pathways we can go. We know that certain strategies can be more advantageous than others in terms of cash flow, what we pay out of pocket, potentially forgiveness. So have you critically evaluated your loan repayment strategy? Other areas of the financial vitals check are we set with things like own occupation, Long Term Disability Insurance, or for those that need life insurance, we have a good term life insurance policy that’s going to cover the needs that we have, are we on track with retirement savings? Right?

We’ve talked about all these topics on the show before these areas, why it’s important to start here with the financial vitals check is all of these areas are going to potentially impact cash flow, and give us insight into where we want to prioritize and focus with the budget because you’ll see here in a moment, then we talk about how to execute on the budget. One of the things we need to know is what are the goals that we want to include in our budget? What are we focusing on? What are we prioritizing on in doing this vitals check is going to help us in part, identify what those areas are. Now if you want more information on this concept of financial vitals checking, you want to do your own financial vitals check, we have a neat tool available for free. If you go to yourfinancialpharmacist.com/financial-fitness-test. That’s our financial fitness test, again, yourfinancialpharmacist.com/financial-fitness-test that will take you to a quick interactive tool, and it’ll help you identify what some of these areas are to focus on. Again, we’ll link a link to that in the show notes. So that’s step one, doing the financial vital check. 

Tim Ulbrich  11:40

Step number two, again, we’re not even in the budget yet, right? Step number two is setting the vision. I firmly believe, we firmly believe, that without a compelling vision, the budget will feel restrictive, right. Without a compelling vision, the budget will feel restrictive. And I can almost guarantee you as well that you will run out of gas at some point in time, if you don’t have a compelling vision, only to find yourself and the whiplash between, in and out of being intentional with your finances. Like we tend to approach other areas of our life, right, such as fitness, such as our diet, and so forth. If we have a compelling vision, think of that as the engine for the financial plan, especially if you are in a season of grinding it out or cutting back, which hopefully is temporary. But especially in those seasons, we want to have a very compelling vision that’s going to drive us forward and keep us motivated. So first things first, what does your rich life look like? What does your, keyword there, your rich life look like? I love this quote quote from Roy Bennett. He says, “Dream your own dreams achieve your own goals. Your journey is your own and unique.” That’s so important here, when we think about setting the vision for living a rich life. When we talk about our financial plan and our goals. It’s so easy to get caught up into what are other people doing or the comparison game. What does it mean for your family to be living a rich life.  If we can get clear on that -something we’ve talked about on this show before – that’s gonna help us really have a strong plan when it comes to how we’re not only going to implement the budget, but how we’re also going to be able to achieve other financial goals like long term savings, and retirement. Don’t underestimate this step. Step number two, setting the vision think of this really as the window in which we’re looking through as we’re making any of the individual financial decisions. 

Tim Ulbrich  13:44

Alright, step number three, is I want you to track back your spending 90 days. So before we get into the spreadsheets, before we start to set the budget going forward, I want you to track back you’re spending 90 days right? This is the audit of the expenses to identify how have we been spending our money before we set what the goal is going forward. Now, this is really easy to do. Thankfully, in 2024. Many banks, many tools, software options that are out there, that we can quickly pull statements from credit cards, from debit cards, from various accounts, and be able to aggregate these and many of them even automatically will categorize them for you. Sometimes you gotta clean that up. But this is a process that we think is really important before we set the plan going forward. Now 90 days, I believe is an important window of time, because in any given month, right in any 30 day period, we can have some anomalies with the budget that might not be “normal.”, right to the month that we would have throughout the year. And so 90 days is going to help to average that out a little bit. That’s one of the reasons we want to look back 90 days but also by looking back 90 days we’re going to start to identify some patterns of things that we might want to adjust or at least be aware of as we set the budget and plan going forward. So that’s step number three is we’re going to track back 90 days categorize those expenses, really look at what is our spending patterns, what’s the spending behaviors? And there, we’re going to quickly identify what’s the difference between our expenses, and what’s the differences between our take home pay, right, and that’s going to help us identify what we have to work with for the budget.

Tim Ulbrich  15:21

 Alright, step number four is then actually setting the budget. Now, this is intentional that we don’t start here, right, I firmly believe from experience from working with many pharmacists on this that if we start with a budget, we tend to lose that momentum that I’ve been talking about. And especially if we have two people that are working on this together, where maybe they’re not on the same page financially, we want to first get clear on the vision, right? If we can have the shared dreams, the shared vision, I’ll never say the budgeting process is easy. But it’s more palatable when we’re working then from that mindset where, okay, now the budget is simply the execution of the vision that we’ve agreed upon. Right. So we don’t want to start here with a budget.

Of course, there are many ways to budget, some of you might be familiar with budgeting methods, such as the 50,30, 20 budget, which is about 50% of your expenses should be for essential, or excuse me, 50% of your income for essential expenses, about 30% of your income for discretionary expenses, those are the things that are the nice to haves, but we could cut them if we needed to cut them, and then about 20%, that’s going to go towards savings or investments. So there’s different models and frameworks of that. But many of you may be aware of something like that. There’s also budgeting methods that are known as like the no budget budget, which simply means that you identify, you know, what are those critical expenses that you have to fund each month, and then you just don’t overspend your income beyond that, right. And so that’s a method that we see people that are a little bit further in their career, that have a more significant rhythm and cadence to what they’ve been doing over a long period of time. They have a good handle on their expenses and their goals and whether or not they’re on track, that might be something that they’re not tracking in such a granular way. Okay, so lots of different ways to budget I’m going to focus though not on the 50-30-20 budget, not on the no budget budget, I’m gonna focus on the zero based budget, because I believe that while this isn’t for everyone, I believe that for many people that are trying to get either on track, let’s say you’re just getting started in your career, and you’re trying to develop a system that makes sure you’re setting yourself up for a good long term plan and that you have a good foundation, I think this is a great way to get started. And then you can pull back over time, or for those listening saying, hey, maybe you need to get back on track, or I’ve kind of lost my way. And I want to have a season of really getting refocused. I think the zero based budget method can be a way to do that.

Now, as a reminder, if you want to download the YFP budget template, so you can work along side as you’re listening, hopefully, you’re not driving as you’re doing this, you can go to yourfinancialpharmacist.com/budget to get that Excel template for free. Okay, so inside of this step of the zero based budget, I’m gonna walk you through five steps of how to complete the zero based budget. Step number one is you have to know your take home pay. Now, as obvious as that sounds, this can be challenging sometimes, right, especially for folks that are just getting started. You know, I see this often from a transition where someone’s going from student to resident or student to fellow and then they’re going into the first job, right? There’s that change that’s happening, or individuals that are going from one income to two incomes in the household, that certainly can be a season of change as well, or for those those seen that variable income. Right? Whether that be you know, side hustle income, additional income, or you don’t work consistent salary types of positions. This can be sometimes challenging, but we have to know on average per month, and for those of you that have variable income, we want to be conservative in this estimate. We have to know on average per month, what is our take home pay, right? This is the amount that you’ll be working with each month to cover your expenses and to put to work to achieve your financial goals. The take home pay or net pay is the amount that shows up on your paycheck, every pay period after taxes after health care insurance premiums that you pay after any retirement contributions and any other deductions that are withdrawn from your base pay or your gross pay. Okay, so for students, any students that are listening, right, this could also potentially include things like student loan disbursement money, plus any earned income that you would have in internships and so forth. So that’s step number one is that we have to determine our take home pay.

Step number two is we then want to account for and subtract our necessary or essential expenses. Now, the definition of necessary can be debated but for the purpose of this activity, let’s include the following as necessary or essential expenses. These would be things like housing, transportation, food, utilities, insurance premiums -if that’s applicable-and any minimum payments on your debts that you need to make. Now in this step, consider your food expense as what you need as an essential right, anything else that would be dining out, we’re going to include in discretionary in step number three in this budgeting exercise. Okay, so that’s step number two is we account for all of our essential or necessary expenses. And we’re working down from our take home pay.

Step number three, then is we’re going to determine how much we spend on discretionary expenses. Think of discretionary expenses as the nice to haves, but in a true financial emergency, they could be cut, if you needed to cut them, right, these would be things like eating out, you know, trips, extra trips, or shopping, extra payments on debt, clothing, expenses, beyond the minimum, you know, housing upgrades, and so forth. Right, it’s very easy to justify any one of these as essential. So it’s important here to be honest with ourselves, when evaluating this category. If you have no idea how much you spend on these types of expenses in a month, a good place to start is to review these from again, as we did earlier, looking back 90 days to review what you’re spending in these areas in various statements and categorize these whether that’s credit card statements, debit card statements, whatever might be the source of those expenses. Now, I want to emphasize here that discretionary expenses are not bad, right in any way, shape, or form. I think sometimes we get to this step, and we start to have some self judgment, and a little bit of questioning, Well, should I be spending money here? Should it be spending money there? Discretionary expenses, and of themselves are not bad, we’re just separating them from essential expenses as we look at this exercise. In fact, they’re an important part a very important part of living the rich life that we want to live, right? Yes, we’ve got to pay down debt. Yes, we have to save and invest for the future. But we also want to enjoy some of these things along the way. So that’s step number three is determining how much to spend on discretionary.

Step number four, then, is calculating what we call disposable income. Remember, we started with take home pay, we subtracted essential expenses, we subtracted discretionary expenses. And now what we’re trying to determine is what is the disposable income. So this is the amount that we calculate by taking, again, the take home pay, subtracting essential and discretionary expenses. This number is the amount that you have to put towards other financial goals, whether that’s building an emergency fund, whether it’s saving for kids college, whether that’s additional retirement savings, down payment on a home, second property, whatever might be the case. So for example, if you have a take home pay of $7,000, you have necessary expenses of $3,000, discretionary expenses of $2,000, you would have leftover $2,000 of disposable income that we can identify and work with and put towards other goals. Now, why this budgeting method, I think works well and hopefully is one that you don’t hate is we are doing this proactively, before we actually earn the income. Right? We’re doing this proactively before we actually earn the income. So, if we can identify in advance what our goals are, and we can identify how much we have to allocate towards those goals, then the next step we’ll talk about is how to actually make sure we distribute them accordingly. All the sudden, we’re thinking in a way that we are pre funding our goals, right really important, rather than waiting to see what’s left over at the end of the month. And that is what we typically see is sure this takes time to get set up. But when we have this system humming, when we see that we have disposable income, or we thought about that to assign to our various goals, and we know that we’re funding those goals, we can really see some feelings of momentum and progress that are taking place. So that’s step number four, calculating your expense, disposable income.

And then step number five is allocating that disposable income to your goals, right. This is where I really feel like the magic happens: allocating your disposable income to your financial goals. And again, we’re doing this proactively before we earn the income, or at least preparing for this. And then once we earn the income, we’re going to allocate accordingly. So if the amount of disposable income, right, in step number four, when we calculated that disposable income, if the amount of that disposable income isn’t enough to meet the goals that you’ve set and the timeframe that is desirable to you, or you find out that you have a deficit here, well, this is where really where the rubber meets the road. We’ve got some work to do. Right, we’ve got two options. We can adjust our goals, I guess three options, we can adjust our goals, we can cut our expenses, or we can try to grow our income and perhaps it might be a combination of those three, but this is really where we shine a light on the reality of where we are at and so often with the financial plan. The stress comes from living in the dark, right wondering, I hope, I wish, I dream are we going to be able to do this? And we’re going to be able to do that? Really, this system is telling us where are we at? And what are the areas that we want to focus on? And what are the dollars that we have available to do that if we can’t meet those two things? What adjustments do we need to make? Do we need to adjust our goals? Do we need to cut our expenses or, and or are their options to grow our income? Now, the reason why this is called a zero based budget is because at the end of step number five, where we’re allocating our disposable income to our goals, we should have “spent”, “spent” because we’re doing this proactively, our entire income, meaning that every dollar has been assigned, and we have a $0 balance remaining, right, because we’ve allocated every dollar to essential expenses, discretionary expenses, and then ultimately, to the goals that we’ve determined are most important.

Alright, so those are the five steps of creating the zero based budget. Now, if we zoom back out, remember, where did we start? We started with doing a financial vitals check. Where are we at today? What what is our net worth position? What are the areas of the financial plan that we want to focus on? We then talked about setting the vision, right? What does it mean, for us? Our unique plan and vision for living a rich life? How are we spending our money? How are we spending our time? We then talked about tracking back 90 days, so we can get an idea of what our spending is in various categories of the budget on average each month. And then we talked about setting the budget, right. And that was the five steps I just reviewed with a zero base budget.

Tim Ulbrich  26:31

Now the final step of all this part number five years really tracking and automating this system. Now how you choose to track this really doesn’t matter to me, at the end of the day, it’s the system that works best for you. And is the system that is feasible for you to keep going, at least for the foreseeable future. So when I asked a group of pharmacists, hey, what system do you use to track? You know, some people use some of the fancy softwares and tools that are out there, such as YNAB, or Every Dollar, just a couple examples, some use a tool that’s provided to them through their bank or the credit card that they use. Most people I would say, use probably a Google spreadsheet or some type of Excel template. So how you track it to me, doesn’t necessarily matter. But the second part of this final step, right, I mentioned, track and automate. Track and automate when it comes to automating your financial plan. It is so obvious, so effective, so easy to implement, but so many people aren’t optimizing this.

Think of automation as the mechanism by which you’re going to put your budget that we just said, we’re going to put this to work for us each and every month, because we’ve already done the hard work to proactively define what are our goals? And how are we going to prioritize and fund those goals. Now, I cover this in detail at length in Episode 341, where I talked about five financial moves to make in 2024, I talked about the concept of automation, I talked about exactly what the system looks like for Jess and I and our own financial plan. So make sure to go back and listen to that and how you can begin to implement automation as a part of your financial plan. Alright, so there you have it. Five steps that you can use to implement a budgeting system and process that not only hope, hopefully helps you achieve your financial goals. But I also hope makes this topic just a little bit more palatable. So we talked about the importance of doing that financial vital check, setting the vision, tracking back 90 days, setting the budget, and then developing a process to track and automate that along the way.

Alright, as we wrap up today, an important reminder about our webinar coming up on March 7 at 8:30pm/Eastern, Budgeting Blueprint, What Zero-Based Budgeting Is, Why It Works, and How to Start One. I’m really excited to walk you through in a visual manner how you can implement your own zero based budget as well as to anonymously feature other real pharmacists’ budgets for you to see. So to get started, you can register for the webinar for free again, you visit yourfinancialpharmacist.com/budgetwebinar again that yourfinancialpharmacist.com/budgetwebinar to save your seat. We’re gonna be giving away three $50 Amazon gift cards of pharmacists who submit their budget to be featured and who attend the webinar live. So as a reminder to have your template, your budget template featured, you can download that free zero based budget template yourfinancialpharmacist.com/budget, fill it out with your own numbers, send it back to us attach it [email protected], in the subject line make sure you note budget and then if you have any questions in your own budget template you want me to address during the webinar make sure to include those in the email as well. Alright, thanks so much for listening to this week’s episode of the YFP Podcast. We’ll catch you again next week. Take care.

Tim Ulbrich  29:51

 As we conclude this week’s podcast and important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding material should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. Furthermore, the information contained in our archive newsletters, blog posts and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of Your Financial Pharmacist unless otherwise noted, and constitute judgments as of the dates published. Such information may contain forward looking statements, which are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer. Thank you again for your support of the Your Financial Pharmacists Podcast. Have a great rest of your week.

 

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YFP 345: 7 Personal Finance Books to Read in 2024 with Tim Ulbrich


Tim Ulbrich reviews seven impactful finance books he recommends for both seasoned investors and beginners to gain strategies and inspiration for success.

Episode Summary

In this episode, Tim Ulbrich continues the discussion from Episode 341 on “5 Financial Moves to Make in 2024.” The fifth “move” was about “setting a plan for your personal finance learning,” and this week, Tim dives into seven personal finance books that have profoundly influenced his financial journey.

With no particular order in mind, Tim shares insights from each book and how he has implemented key takeaways into his own financial plan. You can find links to all these recommended books in the show notes. Tim emphasizes that these are not just any books – they are ones he frequently recommends or gifts to others, and they have played a crucial role in his and his wife, Jess’,  journey towards achieving financial freedom.

Whether you’re a seasoned investor or just starting on your financial journey, these books are a must-read (or re-read) in 2024. Tune in for valuable insights and inspiration to help you pave your way to financial success!

About Today’s Guest

Tim Ulbrich is the Co-Founder and CEO of Your Financial Pharmacist. Founded in 2015, YFP is a fee-only financial planning firm and connects with the YFP community of 15,000+ pharmacy professionals via the Your Financial Pharmacist Podcast podcast, blog, website resources and speaking engagements. To date, YFP has partnered with 75+ organizations to provide personal finance education.

Tim received his Doctor of Pharmacy degree from Ohio Northern University and completed postgraduate residency training at The Ohio State University. He spent 9 years on faculty at Northeast Ohio Medical University prior to joining Ohio StateUniversity College of Pharmacy in 2019 as Clinical Professor and Director of the Master’s in Health-System Pharmacy Administration Program.

Tim is the host of the Your Financial Pharmacist Podcast which has more than 1 million downloads. Tim is also the co-author of Seven Figure Pharmacist: How to Maximize Your Income, Eliminate Debt and Create Wealth. Tim has presented to over 200 pharmacy associations, colleges, and groups on various personal finance topics including debt management, investing, retirement planning, and financial well-being.

Key Points from the Episode

  • Personal finance books and their impact on achieving financial goals. [0:00]
  • Balancing saving and spending for a rich life. [5:30]
  • Wealth-building books and their impact on financial planning. [9:30]
  • Building wealth through calculated risks and long-term investments. [14:09]
  • Personal finance books and their impact on the Tim’sjourney. [18:03]

Episode Highlights

“When it comes to personal finance, I believe strongly that there is no “arrived” with the financial plan. A commitment to ongoing learning and having the humility to understand that there is much to learn on this topic and mistakes are inevitable is key to long term success.” – Tim Ulbrich [01:49]

“Money is a tool that if we are planning appropriately, we can facilitate and direct to those areas that have the most significance.” – Tim Ulbrich [04:04]

“That’s why as we say, often, a good financial plan should take care of your future self, but also allow you to live a rich life today.” – Tim Ulbrich  [07:13]

“Money is something that affords us the opportunity to pay for our basic needs and, if we’re able, to live our rich life and to give to others. And next time you hold a bill of any value in your hand, remind yourself that it’s a piece of paper. In fact, it’s a piece of paper that I recently learned is 25%, linen, 75% cotton. But this is a piece of paper that has value because, number one, we all agree that it has value. And number two, it’s backed by the faith and credit of the US government. So what’s my point? My point is that it’s finite, right. And if we’re not careful, we can miss the boat on accruing while losing sight of the so-what.” – Tim Ulbrich  [20:00]

Links Mentioned in Today’s Episode

Episode Transcript

Tim Ulbrich  00:00

Hey everybody, Tim Ulbrich here and thank you for listening to the YFP Podcast where each week we strive to inspire and encourage you on your path towards achieving financial freedom. This week, I’m covering seven personal finance books that have been integral in my own journey that I think you should read or perhaps reread in 2024. My criteria for a book to make this list includes one that I frequently recommend or gift to others, and that I have implemented one or more things from the book of my own financial plan that has had a significant impact for Jess and I achieving our financial goals. Before we jump into the show and my list of seven personal finance books to read in 2024, I recognize that many listeners may not be aware of what our team at YFP Planning does and working one on one with pharmacists all across the country. YFP Planning offers fee-only high-touch financial planning and wealth management services for pharmacists at all stages of their careers. If you’re interested in learning more about how working one on one with a certified financial planner can help you achieve your financial goals. You can book a free discovery call at YFPplanning.com. Whether or not YFP Planning financial planning services are a good fit for you, know that we appreciate your support of this podcast and our mission to help pharmacists achieve financial freedom.

Tim Ulbrich  01:17

Hey, everyone, welcome to this week’s episode! Tim Ulbrich here and I’m excited to talk through seven personal finance books that I think you should read or perhaps reread in 2024. For now, we kicked off the new year with Episode 341, where I cover the five financial moves to make to crush your 2024 goals. And we’ll link to that episode in the show notes. One of those moves was to set your learning plan. To have an intentional plan and effort to up your financial IQ and your financial knowledge. And when it comes to personal finance, I believe strongly that there is no “arrived” with the financial plan. A commitment to ongoing learning and having the humility to understand that there is much to learn on this topic and mistakes are inevitable is key to long term success. Now one of the greatest advantages that we have living in the 21st century is that we have access to learn just about anything that we want, often at low or no cost. Right. Thank you very much to the Public Library system. So here are seven financial books that have had a profound impact on my journey, such that I often recommend these books to others, gift them and I’ve implemented at least one often more than one of the teachings in my own financial plan. 

All right, in no particular order. Let’s jump in with book number one, which is I Will Teach You To Be Rich by Ramit Sethi. Now I had the chance to hear Ramit meet speak in 2019 at the FinCon event the Fin Con Conference in Washington DC and it was fire. He’s a fantastic speaker, a fantastic teacher. And at the time, the theme of his talk, which he talks about the book I Will Teach You To Be Rich, is money dials. Money dials, a key concept in that book. And really the concept of money dials is identifying what areas of spending have the most significance, meaning or impact for you, and dialing those up. And on the flip side, finding those areas of spending that perhaps are somewhat automatic, and we may not even be thinking a whole lot about it. And they have the least significance, or meaning or impact and dialing those down. Right? It’s about intentional allocation of the dollars that we have and spending them in areas that we derive the most significance. Now it sounds obvious, but it’s easy to fall into the trap of spending money on things that you don’t really care that much about at the expense of not having money to spend on things that mean the most to you. And I love that he starts off the book with this, right? Because before we implement the X’s and O’s of the financial plan that you’ve heard me say on this podcast many times, we have to be clear on what does it mean to live a rich life. 

Now he uses the terminology money dials, we talked about living a rich life, we’re talking about the same thing, right? Money is a tool that if we are planning appropriately, we can facilitate and direct to those areas that have the most significance. Now in fact, as a society, I would argue that we do this all the time, the literature shows us that experiences and giving derive the most significance in terms of the connection between happiness and money-  hold that thought I’m gonna come back to that in one of the other books that I mentioned in this list of seven. Yet those two things often fall towards the bottom of the list as we give preference to less meaningful things. Now this is not about me saying what should or shouldn’t be meaningful, right? Everyone has different significance and meaning it’s about getting clear on what are those things that you derive the greatest significance and meaning from and is your financial plan is your spending in alignment with those areas? 

Now, in addition to the concept of money downs in this book, his teachings on automation have stayed with me and are ones I’ve applied in my own plan and teach, often to other pharmacists. Now he says in the book that automating your money will be the single most profitable system that you’ll ever build. And I would whole heartedly agree with that. It takes time, a little bit of time to set up a perhaps not as much as you think. But once you have a system in place, where you’ve thought about and identified your goals, we’ve accounted for them inside of the monthly spending plan. And then we are automatically funding those goals. And we see that process happening. Boom, right? That’s when we’re really humming with the financial plan. In general, this book is a great personal Finance 101 read, it’s an easy read. Again, he’s a fantastic teacher. And I love the principles in this book and are principles that I often apply in my own financial plan. So first book on our list,  I Will Teach You To Be Rich by Ramit Sethi. 

The second book on my list is Die with Zero by Bill Perkins. Die with Zero by Bill Perkins. Now, this book is all about perspective, and was one of my favorite reads, if not my favorite read of 2023. This book is going to challenge you to think differently about the value of spending and finding that balance with saving or as we say, at YFP finding the balance between living a rich life today, and planning and taking care of our future selves. Now, if you’re an aggressive saver, guilty as charged, right, and you find yourself challenged to enjoy spending money today, right to let go the reins a little bit, this is a must read for you. Bill Perkins, in the book challenges traditionally held beliefs about retirement planning, and passing down generational wealth. 

One of my favorite quotes from the book is when he says quote, “People who save tend to save too much for too late in their lives, they are depriving themselves now just to care for a much, much older future self, a future self that may never live long enough to enjoy the money.” Nothing in the future is guaranteed. Yet we should plan for our future selves. Both are true, right, we have to strike this balance. And that’s why as we say, often, a good financial plan should take care of your future self, but also allow you to live a rich life today. And if you’re feeling that tension, I think you’re gonna find a lot of value in this book. 

Through Bill’s teaching, I’ve come to appreciate and still need a lot of help guidance and reminders from my financial planner, from Jess in our own plan, that spending just like saving is a learned habit. I was recently reminded of this after listening to an interview on Ramit Sethi’s podcast, where he was talking with a couple nearing retirement age that had over $6 million in net worth. It was quite sad to hear the husband rationalize with Ramit for almost two hours, all the reasons why he couldn’t spend and enjoy because he had to, quote, “first save it up” or quote, “work harder” to make up for what he was going to spend. Again, net worth of $6 million. So for all intents and purposes, they achieved their savings goals plus some, right? The plan had worked. They had gotten to that point that they were planning for all along. But despite what the numbers showed, he couldn’t shift his mindset. He was stuck in the grind and the hustle of working and saving, working and saving. And this is something we don’t talk about often enough with a financial plan that when we work hard for 30 or 40 years to save, that is a big transition. When we get to the withdrawal phase, right? We need to be planning for that. We need to be preparing for that. And we need training wheels along the way to help us with this learned behavior of spending. And the point that Ramit was trying to make and trying to get this husband to see is that in order to live a rich life, the plan that got them there can’t be the same as the plan going forward. Right, the plan that got them there to work hard to save, save, save, work hard, save, save, save, that mindset was going to require a shift in order to live a rich life. New behaviors need to be learned. And ideally, we can build these spending muscles throughout our careers and not just wait until some day off in the future that may or may not come and may or may not be what we have in mind. So my challenge for you is I highlight this book Die With Zero here by Bill Perkins not only to read the book, but my challenge to you is does your financial plan include a balance of saving for your future self and living a rich life today? 

Number three in the book is Rich Dad, Poor Dad by Robert Kiyosaki. Rich Dad, Poor Dad by Robert Kiyosaki. Now, Robert Kiyosaki has recently come into the spotlight and many different controversial ways. So personality aside, his teachings in this book, in my opinion, remain a classic. This book is all about mindset, not X’s and O’s. Like some of the other books that are on the list today. And if you think of the financial plan as a series of decisions that need to be made, I think of this book as being a philosophy that guides those decisions, it’s the thread behind the decisions that we make. Now, some key takeaways from this book that have stayed with me for several years, I think I first read it about seven or eight years ago, maybe even longer. I’ve read it a second, maybe a third time at this point. And it’s one of those books I’d like to come back to every so often. And a few of the things that have stayed with me is that, you know, what we might think is an asset versus a liability. I think he challenges that mindset. Why the leverage is an important tool to build wealth. And of course, there’s risk with leverage. And we have to balance that. Also, what has stayed with me is why traditional W2 income limits wealth building. Traditional W2 income has limits as it relates to wealth building. And finally, why business ownership and real estate investing are key legs of wealth building. So he makes a strong argument that much of the tax code is really written in favor of those that own a small business and those that own real estate. Now, that’s not to suggest that those pathways are for everyone, by any means. But it really highlights to me the philosophy in which we might be thinking about building wealth. 

Now, this book in particular, along with Tax Free Wealth, by Tom Wheelwright, and we’ll link to all these books in the show notes, Tax Free Wealth by Tom Wheelwright really opened my eyes to the importance of tax as a part of the financial plan, one that is kind of always behind the scenes that probably many of us are not thinking about. And more specifically, the strategies that can be employed to optimize our tax situation, right? We want to pay our fair share, but we want to pay no more. And I think through these teachings, and really digging into the form 1040 and understanding how the different components of that form work and what are the levers that we can pull to make our tax rate as efficient as possible. These two resources: Rich Dad, Poor Dad and Tax Free Wealth have really been instrumental in opening my eyes to the significance and importance of tax as a part of the financial plan. 

Our number four on my list is The Millionaire Next Door by Dr. Tom Stanley. The Millionaire Next Door by Dr. Tom Stanley, and the updated version, The Next Millionaire Next Door, featuring Tom’s daughter, Dr. Sarah Stanley Fallaw which we had the pleasure of having on the podcast on episode number 200. This book examines the key behavioral traits of millionaires. One of my favorite quotes in the book is when he says, quote, “One of the reasons that millionaires are economically successful is that they think differently.” They think differently. What he’s talking about is one of my key takeaways from that book is that net worth, not income, net worth, which is your assets, what you own minus your liabilities, that really is a true indicator of your overall financial health. Net worth, not income, as the financial vitals check, is really going to help us as we think about this mindset of is our income being translated into building our assets, and paying down our debt. 

Some of my other key takeaways from this book is that, you know, we often wouldn’t know who the people are that are millionaires or multimillionaires. When you look at the research that’s presented in The Millionaire Next Door, as well as the updated version and The Next Millionaire Next Door, the spending behaviors and patterns would say that they probably aren’t the people that we think are millionaires that more or portray to be millionaires. They often have a frugal mindset, doesn’t mean that they’re cheap doesn’t mean that they don’t like investing in good experiences, doesn’t mean that they’re not philanthropic or givers. But they often have a frugal mindset. They’re typically not trapped, millionaires are not trapped by what I think of as the big rocks, right? They’re not house poor, they’re not car poor. They do take calculated risks, often in business or real estate. And most millionaires, as the research suggests, in that book are self made. It’s not typically inherited money. Fascinating research and concepts. I would highly recommend The Millionaire Next Door or the updated version, if you haven’t already read it. 

Alright, number five on my list is the Compound Effect by Darren Hardy. The Compound Effect by Darren Hardy. It was one of those books, it’s a quick read. It was one of those books, I remember exactly where I was when I read it. At our old house up in Northeast Ohio during the summer, I read it outside in couple hours, I couldn’t put it down. And one of those books, you’re just constantly highlighting taking notes. You’re like “Yes, yes, yes!” And this is not exclusively a personal finance book, but I love the applications here. And I was recently reflecting on those in my life that have been financially successful because I think it’s helpful to learn and grow from those who have actually done it. Right. And as people came to mind that I thought, okay, who has been long term financially successful in building wealth? Not short term success, long term, financially successful? And as I thought more about that as like, I can’t think of anyone I know who got rich off of buying whole life insurance policies, buying and altcoins are buying NFT’s. And I’m not saying that people don’t exist that have built wealth in those ways. Rather, what I’m saying is that I don’t know anyone that took this path. And I feel confident in saying the perception is much greater than the reality when it comes to these types of vehicles being a viable path to building wealth. Right? Often these are short term solutions that are bandaids when we really need to look at long term consistent behaviors.

Rather, when I think of those people that have built long term wealth, it was a long, methodical, patient journey. One intentional step after another where those decisions, and good decisions not to say there weren’t mistakes along the way, but those good decisions compounded over a long period of time. And I think, unfortunately, we’re hearing less of these journeys, right, because these aren’t great clickbait, these aren’t great in terms of social media algorithms. They’re often boring stories in the literature really supports that in the book, The Millionaire Next Door, which I just mentioned previously. And several, when I thought more about who are these people, several not all have multiple pathways of building wealth. Typically, it’s traditional investments, it might be equity in a business, it might be real estate, and those are always in balance. But I’ve noticed that as a theme, and those that have been really long term, successful in building wealth, and often being philanthropic, as a part of that wealth building. These individuals that come to mind are taking calculated risks on opportunities, where they see that the upside dramatically outweighs the downside. And they have a strong financial foundation in place such that if that calculated risk doesn’t work, they’re not going to be impacted in a significant or catastrophic way. Right, they’re able to take that calculated risk, because they have that strong base and foundation in place. 

As I think of these people that come to mind, I would describe them as overall fairly conservative, yet willing, again, to take some level of risk if an opportunity presents itself. So they’re not risk averse, but they’re also not flashing. In fact, they’re quite humble. And they’re often very philanthropic. And they really do embody some of the teachings that have stayed with me from this book, The Compound Effect by Darren Hardy. He has a formula in this book that I often reference back to and that formula is small smart choices, plus consistency plus time equals radical difference. Small smart choices, plus consistency plus time equals radical difference. That is the definition of compound interest when we think about saving over a long period of time. So this is the path I will follow. This is the one that I have seen work – a path defined by working hard, taking calculated risk, investing in tax efficient, appreciating assets, building equity that can be converted to other assets, developing a habit and priority for giving and doing this over and over over a long period of time to allow those results to compound.

Our number six on my list is Total Money Makeover by Dave Ramsey. The Total Money Makeover by Dave Ramsey. Now, I’m not an avid follower of Dave Ramsey and his principles and the baby steps but I have to give credit where credit is due. Reading the Total Money Makeover going through Financial Peace University listening to Dave Ramsey’s podcast, was really like a wake up call over a decade ago that inspired the journey that Jess and I took to ultimately pay off our $200,000 of student loan debt, and really led to is the really beginning steps of the place that we are today the journey that we would take to get there. That book, The Total Money Makeover, listening to the podcast really lit a fire under me to want to learn more, right, as I mentioned, was kind of a wake up call to create our own path, our own plan. Even if we didn’t follow the path and plan that he prescribes to so many through the baby step formula. The baby steps, I will admit early in our journey, it was a grounding framework. A grounding framework for us that we needed at the time, as we were trying to balance many things. We weren’t doing any of them particularly well. And we didn’t have an intentional plan in place. And that really was the footing that we needed to get started that would ultimately allow us to build momentum, to build our emergency savings, to get out of debt, and then to have a prioritized approach to achieving our goals. So that’s number six, a Total Money Makeover by Dave Ramsey.

Number seven, last on my list is Happy Money, The Science of Happier Spending by Elizabeth Dunn and Michael Norton. Now, I would assume many of you have heard of all, perhaps, the first six books that I mentioned, but maybe not the case with this one. I ran across this several years ago. And I intentionally book ended my list of seven here with this one in particular because I think that it’s an important reminder that money is a tool, right? I mentioned that when I talked about Die With Zero by Bill Perkins. Money is something that affords us the opportunity to pay for our basic needs and, if we’re able, to live our rich life and to give to others. And next time you hold a bill of any value in your hand, remind yourself that it’s a piece of paper. In fact, it’s a piece of paper that I recently learned is 25%, linen, 75% cotton. But this is a piece of paper that has value because, number one, we all agree that it has value. And number two, it’s backed by the faith and credit of the US government. So what’s my point? My point is that it’s finite, right. And if we’re not careful, we can miss the boat on accruing while losing sight of the so-what. And that reminder comes I think strongly in the book, Happy Money, The Science of Happier Spending, by Elizabeth Dunn and Michael Norton. 

This book provides what the research has to say, on the science of spending and the connection between money and happiness. Now, happiness,how do you define that, right? That’s an important component to consider. But my takeaways from this book were that the literature supports, to no surprise, but an important reminder, the link between happiness and money typically lies in two main areas. Number one, spending money on experiences and memories that will come from those. And number two, on giving. When you look at the connection between happy and money, this, it strongly points to giving and experiences as an important part of the financial plan. I think if you talk to anyone who’s been at this for a while, you start to see this come out again, especially as they shore up some of the basis of their financial plan. These are the areas that you typically see people light up when they talk about their financial plan. Alright, so there you have it, short and sweet, seven personal finance books that have had a profound impact on my journey and are books that I would recommend you read or reread in 2024. We’ll link to all of these books in the show note. 

And if you have a book that you often recommend, or that has had a profound impact on your journey, I want to hear about it! Shoot me an email at info@your financialpharmacist.com Let me know what I left off the list. I’d love to read it and perhaps share it with our community in the future. Again, you can reach us at [email protected]

Now we all know that learning right reading books, listening to podcasts, learning is one thing, but learning and taking action with accountability is really where we start to see things happen. And that’s why we’re so excited about the work that our team at YFP Planning is doing through our fee-only, certified financial planning service. You want to learn more about what it looks like to work one-on-one with a fee only certified financial planner from Your Financial Pharmacist,  yes to learn and grow in your financial IQ and knowledge, but also to take steps and implement those in your financial plan and be held accountable to achieve those results. You can book a free discovery call at YFPPlanning.com. Again, that’s YFPPlanning.com. Thanks so much for joining me on this week’s episode. And we’ll be back next week. Have a great rest of your day. 

[DISCLAIMER]

As we conclude this week’s podcast and important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding material should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. Furthermore, the information contained in our archive newsletters, blog posts and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of Your Financial Pharmacist unless otherwise noted and constitute judgments as of the dates published. Such information may contain forward looking statements, which are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward looking statements. For more information, please visit YourFinancialPharmacist.com/disclaimer. Thank you again for your support of the Your Financial Pharmacists Podcast. Have a great rest of your week.

 

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$800*

Loans*

≥150K = $800

100-149K = $450

<100K = $350

Variable: 5.28%+ APR (with autopay)*

Fixed: 5.28%+ APR (with autopay)*

*All bonus payments are by gift card. See terms

The "Kayak" of student loan refinancing, Credible displays personalized prequalified rates from multiple lenders

$750*

Loans

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YFP 344: Beyond the ER: The Entrepreneurial Journey of Dr. Jimmy Pruitt


Jimmy Pruitt, PharmD, Founder & CEO of Pharmacy & Acute Care University, shares insights on his entrepreneurial journey and the EMPower Rx Conference.

Episode Summary

In this week’s episode, join us as we sit down with Dr. Jimmy Pruitt, a Clinical Pharmacy Specialist in Emergency Medicine at Atrium Health. Dr. Pruitt wears multiple hats as the Founder & CEO of Pharmacy & Acute Care University and the brains behind the EMPowerRx Conference. Our conversation delves into his fascinating entrepreneurial journey, exploring the roots of why and how he embarked on this path.

Throughout the episode, we gain valuable perspectives on the intricacies of balancing professional commitments and entrepreneurial endeavors. Dr. Pruitt shares his experiences, lessons learned, and the strategies he employed to overcome obstacles on his journey. Dr. Pruitt also shares his vision for the EMRower Rx Conference – a  unique conference and continuing education experience for professionals in emergency medicine pharmacotherapy. 

Tune in to this insightful conversation with Dr. Jimmy Pruitt to glean wisdom from his unique blend of clinical expertise and entrepreneurial spirit. Whether you’re navigating the realms of healthcare, entrepreneurship, or both, this episode offers valuable insights and inspiration for the road ahead.

About Today’s Guests

Dr. Jimmy Pruitt is originally from Orlando, FL, and is a combination of nerd and gym junky having a background as a division 1 cornerback then turned Doctor of Pharmacy from Presbyterian College School of Pharmacy in 2017. He completed a PGY-1 Pharmacy Residency at Florida Hospital Orlando, and then went on to Grady Health System in Atlanta GA for his PGY2 Emergency Medicine Residency. Dr. Pruitt is currently an Emergency Medicine Clinical Pharmacy Specialist at the Medical University of South Carolina in Charleston, SC.

Dr. Pruitt was honored with the Excellence in Diversity from MUSC College of Pharmacy, Presbyterian College School of Pharmacy (PCSP) Alumni of the Year, and keynote speaker for the 2021 PCPS graduation. Dr. Pruitt’s professional interests include cardiac arrest, shock syndromes, trauma, and hosting the #1 Emergency Medicine Pharmacy Podcast “Pharm So Hard” and operation his new pharmacy academy called Pharmacy & Acute Care University.

Key Points from the Episode

  • Entrepreneurship and pharmacy with Dr. Jimmy. [0:00]
  • Entrepreneurship, pharmacy, and education with Jimmy Pruitt. [1:37]
  • Validating a gap in the market for pharmacist-created acute care content. [6:21]
  • Overcoming fear and taking the first step in starting a podcast. [12:01]
  • Balancing full-time work and business as a creator. [16:10]
  • Growing a team and delegating tasks. [22:53]
  • Business growth and vision for a pharmacy education company. [29:02]
  • Emergency medicine pharmacotherapy conference. [34:56]
  • Emergency medicine and pharmacotherapy conference. [39:25]

Episode Highlights

“The biggest thing that people say is like sometimes you have to just jump and you just have to do all these different things. And I’m like, I have a family, one. So that really kind of changes the dynamic. It’s not just me making this big shift, but I want to make sure that I was able to consistently get that number.” – Jimmy Pruitt [18:37]

“But I’ve noticed as I continue doing both of this, me being a business owner and being very focused as being the president, CEO, whatever the title you want to give yourself when you’re when you’re starting out, it actually made me a better employee.” – Jimmy Pruitt [19:09]

“So as I looked at the component of making sure I’m meeting that output, that I need to be able to consider stepping back, I also realized there was so much more value, because now I’m able to understand other people’s problems.” – Jimmy Pruitt [20:29]

“But learning more at the job and understanding the problems that they have, and other people like them have, has made me be able to understand the market, and how I can potentially use that in the future. But more importantly, my skills as a business owner, has allowed me to be able to solve problems that early in my career, and earlier, you know, in places I’ve been people don’t necessarily think about.” – Jimmy Pruitt [21:58]

“I think when looking at growing a team and really get into that first step of, I want to bring someone else into this, especially when you’re talking full time employment. The very first employee that I hired a couple of years back was just my virtual assistant. And one of the first aspects I realized was a very big challenge of mine was, how do I explain what’s in my head that I do every day?” -JImmy Pruitt [25:03]

“The big thing that I believe that I’m trying to accomplish over again, this next five to seven years is to make this to where we have one unified goal and mission we’re trying to do: provide high quality education related to pharmacotherapy.” – Jimmy Pruitt [31:20]

“I want to provide a home for those individuals and I want I want them to be able to have a home, whether they’re gonna be the consumer, or the producer.” – Jimmy Pruitt [32:42]

“And we want to figure out, how can we do it as for us and by us, instead of someone else creating it and thinking they know what we want. Why don’t we just create it from the ground up?” – Jimmy Pruitt [38:01]

Links Mentioned in Today’s Episode

Episode Transcript

Tim Ulbrich  00:00

Hey everybody, Tim Ulbrich here and thank you for listening to the YFP Podcast where each week we strive to inspire and encourage you on your path towards achieving financial freedom. This week I welcome Dr. Jimmy Pruitt, a clinical pharmacy specialist in emergency medicine at Atrium Health, Founder and CEO of Pharmacy and Acute Care University and Founder and CEO of the Empower RX Conference. We discuss his entrepreneurial journey, including how and why he got started, why he has maintained full-time employment, challenges going from creator to solopreneur, to building a team and the vision for the business over the next five to 10 years. I’m excited to announce our partnership with the 2024 Empower RX conference, a leading event in emergency medicine pharmacotherapy. This year it’s happening in Charlotte, North Carolina on April 26-April 27. I’ll be there and hope to see you there as well. It’s ideal for pharmacists, physicians, PAs, nurses and others in the field. Empower RX offers more than 10 CPE credits, insights from top experts, interactive workshops and groundbreaking research. It’s not just a conference, it’s a community focused experience, fostering learning and networking in a welcoming environment. Take advantage of discounted registration available to the YFP community by using code YFP2024 for 15% off. Again, that’s code YFP2024 or 15%. You can join in person or virtually registered now at EmpowerRX-conference.com and elevate your emergency medicine skills. Again, that’s EmpowerRX-conference.com. 

Tim Ulbrich  01:35

Jimmy, welcome back to the show.

Jimmy Pruitt  01:37

Hey, thanks for having me on again. And it’s been great.

Tim Ulbrich  01:40

So our listeners might remember you back from Episode 284, where we discussed your experiences monetizing your clinical expertise, we’ll link to that episode in the show notes so that folks can dig a little bit deeper. We’ll have some crossover here as well to bring people up to speed. But we certainly did a deeper dive in that episode. And Jimmy, for those that didn’t catch that episode and aren’t already familiar with you and your work, give us a brief introduction to your background and pharmacy and the work that you’re doing now with Atrium Health, as well as being the Founder and CEO of Pharmacy and Acute Care University and the Founder and CEO of the Empower RX Conference.

Jimmy Pruitt 02:14

Thank you. And that’s a mouthful for a lot of you guys. But again, I’m Jim Pruitt. Again, I’m by training at clinical pharmacy specialist at Atrium Health here in Charlotte, a Level One Trauma center, academic, Medical Center, all those great things. And then, in my spare time or lack lack thereof, I like to start off as being a content creator with this pharmacy PEARLS and just having different things that I can give my providers, then that really led to something else led to a podcast called Pharm So Hard. And once that happened, it was really the genesis of something special, I believe. It led to an audience of 1000s of people who didn’t know how to interest in acute care pharmacotherapy, and then from there trying to figure out how to solve the problems that they had. So that led to the next thing, the next thing being after 100. And so episodes Pharm So Hard led to Pharmacy and Acute Care University. And all that really is it just an academy that helps people, pharmacists in particular, with continuing education, but more particularly going to be for board certification prep. So whether you’re studying for your BCPS, or our most popular product that be CMP, your emergency medicine pharmacotherapy, or certification. That is where I spend a lot of my time- question banks, practice exams. And is making a lot of the content that goes along with that. And it’s just been phenomenal to see that growth. And what that led to is people saying, oh, man, I wish I had a place to go to talk about these things versus just studying for it, which led to the Empower RX Conference. So I think, long story short, I am an educator that started to understand the business a little bit more and continuing to learn what business is, and really is focused on how can I not just bring myself along, but how can I bring other people with me to understand the business side of things and monetize their expertise and content? 

Tim Ulbrich  04:08

We’re gonna talk a lot about that on this episode, Jimmy, I want to pick your brain have you know, you started with with an idea identified a problem that needed to be solved starting to solve that problem, which opened up more doors built community in this niche, which is really exciting. And now as you enter this growth phase, you know, there’s exciting opportunities and challenges with, Hey, how does this grow beyond the hours that you have in the day? Right? And what what what challenges may that bring? I want to first ask you that I was I was stalking you on LinkedIn and noticed in your headline, you have four different words creator, connector, educator, and pharmacist. Do one of those resonate more with you than the others and why?

Jimmy Pruitt  04:49

I think that is that’s a very, that’s a great question for one, but I think it it depends, like a good lawyer would say it depends. It depends on what I’m doing. And I think as I look at the different platforms that I’m currently in, I tend to be on one side more than other depending on that particular project. So I like to say, the biggest thing is like, I can be a connector, because again, most of everything I’m doing is usually not just myself, I’m usually bringing different people on whether that’s going to be at work. And I’m working with a provider, and a nurse is having a concern about something, I’m connecting those two and that problem and trying to also provide a solution. The same thing for when I’m in my pacu, where my pack you have, well, a potential customer has a problem. They want to be board certified, and I’m trying to connect them with the best highest quality information that helps them get to their end goal. And my conference, prospective people want a place to come. So I’m literally physically now connecting them with other people throughout the world in emergency medicine, pharmacotherapy. So I think connectors the the one thing I can say, but realistically, I have to be all of those other things, to be able to be a good connector. I have to be a great pharmacist, I have to be entrepreneur to make these things happen consistently. And I have to be kind of a creator to be able to have that audience to begin with. So I think connectors the one word, but I think depending on what hat I’m wearing, is really just depends on that location. 

Tim Ulbrich  06:21

Well, we say it depends on this podcast often. So that is that is welcome. But I appreciate what you’re what you’re sharing there. I want I want to dig deeper in a few areas that I see come up often with aspiring entrepreneurs and side hustlers that I talk with. And you know, one of the first things is really what was the beginning? Like, right, so the genesis of starting the side hustle that’s turned into a business, obviously, you have many, many different activities that you’re doing within that business. You know, tell us a little bit more about the problem that you are trying to solve and how you identify there is a gap and a need in the market. And I know you shared that briefly already. But you know, a natural question might be well, like Jimmy, aren’t these pharmacists already part of other organizations or, you know, cohorts where they’re able to gather other societies and so forth. So what stood out to you as an opportunity in the market that wasn’t already being served that you said, Hey, not only am I a part of this community, but I feel like my peers, my colleagues could also, you know, come together and we can provide value?

Jimmy Pruitt  07:22

Absolutely. So I think one of the things we look at, and I think the very first problem I wanted to solve was providing high quality education in the acute care space. So if we look, one of the things that is very common is that from a oncology standpoint, from a transplant, those medications that are branded still they have a lot of great continuing education out there. Because again, there’s grants, there’s different incentives for companies to make that content. And a lot of those get heavily represented. But from an acute care standpoint, a lot of things from a pharmacotherapy perspective was not necessarily being created by pharmacists. And emergency medicine in the pharmacy space is my first you know, love within this, but I realized that emergency medicine has everything is critical care is ambulatory care is all these other spaces. So I realized that there wasn’t pharmacist created content that was detailed, that was detailed, but also a concise so that we can see it and be actionable. And that was the aftermath of creating the pharmacy Frothy Pearls series that I created when I was a PGY2 resident at Grady. Once that kind of became the first thing I was like, Okay, well, the problem trying to solve is providing high quality education, from a pharmacist perspective in the acute care space, that is highly assessable. That was kind of a next branch with the audience that I was able to generate from from farm so hard, I realized that, hey, I’m already providing education, but I didn’t necessarily consider it to be very different and very unique. But then the audience would tell me these things. And after you start to look, you kind of change your perspective on how you’re looking at your interactions with people want to online, you realize, hey, I have a model here, from a business perspective that I can sustain because most of it, you know, I would love to direct you away for free every day. But it’s not sustainable. Yeah. And that was kind of the first component of finding pharmacist-created acute care, physical therapy information that was concise, but also provide them continuing education as well.

Tim Ulbrich  09:25

My next question was around validation. And how do you validate that that gap truly exists? You know, one of the traps, especially early on in a business as a hey, I’ve got a great idea. I’m gonna kind of run hard and then you realize, oh, wait a minute, like the problem that I thought needed to be solved. Either I’m in misalignment or maybe it’s not as big of a problem as I thought, you know, others may think and so you partly answered that when you said, hey, you know, through the podcasts, obviously, seeing your listeners getting some feedback, you are getting real time information that I’m sure shaped your next steps. Was there anything you did prior to starting that podcast as a PGY2 to validate the problem that needed to be solved, or was that the first step in?

Jimmy Pruitt  10:05

I think it was the first step. I would love to say that I had this aesthetic plan and things of that nature. But realistically, the first two years I was in business, I didn’t know I was in business. Yeah, because I wasn’t charging anything. I think that part of the equation that I didn’t look at what’s the value I was providing, and whether or not that was something that could be sold as a resume. And I think within pharmacy in general, we get so used to just providing a lot of content. And we’re just doing it for just the validation of our colleagues and just to provide great education. But I think the first piece that helped me understand the business aspect of it was when we started creating some of these, you know, hour long presentations, people said, hey, you know, is this for continuing education? And I said, Well, I can get it for but I didn’t realize the process, go through that. And then I remember saying, Hey, how can I get this credential? Is this AACPE certified? It’s like, oh, it’s a price tag to that. Yeah. And then the first step, like, how do I get that taken care of versus me just paying out of pocket a significant amount of money for one hour? I think the first the very first time I did this, three years ago, the credit hours was like $600 for one hour CE. And I was like, Well, if I have 100, people come to this, and we break this down, I think, you know, a few bucks would wouldn’t be horrible for me to do it. So I think that was the first step. But I think I don’t, it made me just think differently. That was the very first trigger to realize, like, hey, if I’m gonna sustain this, I have to figure out a way to monetize it, to just cover the basics of what I’m doing. I think that was the very first step in realizing people were okay with that. Not as many as I thought, initially. There’s a certain amount of people that was okay with that. And I realized that if I can scale it to any degree, it may be something that I can build build upon.

Tim Ulbrich  12:01

And speaking of first steps, you know, I often will will talk with folks that have an idea. But taking that idea, and taking the first step to begin implementation. It’s scary, right? I mean, you know, even when you do the validation of the idea, it’s one thing if people say, I’m interested, I’m gonna pay for it. It’s another thing if they actually show up and pay for it. And as you and I both know, you can assume some much lower percentage than then people may report. And so my question here is, how were you able to be comfortable with taking that first step, and maybe as a PGY2 resident, you know, maybe the pressures off a little bit, and you weren’t yet thinking about as a business, but even that, I’ve talked with pharmacists that are like, Hey, I’ve got a great idea. But, you know, to run a podcast, I got to do A, B, and C, and I got to worry about the microphone and editing and hosting, and yada, yada, yada. And soon enough, there’s no action. Right? There’s no action. And my question for you is, how were you able to take that important first step, that important first action, from which even though you didn’t know you’re in business, from what you would eventually learn and get feedback that would become the foundation of the business?

Jimmy Pruitt  13:09

Yeah, I think that the first step for me, and I would love again, to say that it was it was just phenomenal intuition and I was great, but it really came from mentorship. To be honest, the first thing was that someone, one of my mentors, John Paca, wanted to hear a podcast episode done by me. And he, he, I remember him mentioned, he’s my RPD, he’s my mentor, he was like, I want you to be yourself. And I want you to be different than everyone else. And that was the first thing he wanted me to do. So I think the process went from me having an idea to someone really pushing me and said they want to hear it. So the result was always him hearing this versus me starting it. So I think that was the first goal initially was that, hey, how let me produce this first episode, so he can hear it? Yeah. And that was the end result of the very first task or create this first pearl. So I can present it to these individuals because it’s part of my residency objectives. So I had like this end goal that I started while I was still in residency, but I think the biggest thing was him wanting to hear an episode, because the Pearls was the first thing but it wasn’t necessarily a first step into business. Pharm So Hard was actually the first step into business because again, that’s what opened me up to understanding the problems and the things that were valuable to people that wasn’t just my RPD. I think the first step was being able to start that podcast and the first step of me actually doing that was him saying, hey, I want I want to hear this. So I think for me, my action item was to complete it versus to start it. I think, getting to that point to where letting other people hear that episode, now that took a much longer period of time. To say same episode, I recorded the same thing, but having other people hear that and I was just fortunate to have him, Sean Troy Johnson, a few people to saying hey, you know, you should go for this and you should now let other people hear it. And I think once that came about my partner, Oscar Santalo, who initially started together, we went back and forward it on PGY1 but never gained traction. In PGY2 we gained a little bit more traction, and I made the first episode. And then it’s like, hey, I’ll do the next one. So it became this kind of back and forth to where I made the first one, we listened to it, it was fine. And then the next step was for him to do it. And then I had a little bit more time to be able to get to the next step. But I think those were our first action items. And I thought that I didn’t think it would lead to what it did. But I think just getting started and having some type of MVP is really what it being just having an MVP to start with. Now everything I do, I tried to create an MVP. But I think the first episode, and that was what, Brian Gilbert on antiquated reversal, back 2019? And its 2018. And that kind of lit to what it is today. But I think just getting that first MVP and having someone to push me, because traditionally, I wouldn’t have went through all the steps because my first episode took 16 hours to edit.

Tim Ulbrich  16:08

I remember those well. And I’ll occasionally throw back on, you know, episode one, just remember the journey. And, you know, but it’s a great reminder, I’ve mentioned on this show several times the book Start by Jon Acuff and I think your journey and story is such an important one that, you know, the dots aren’t always in a straight line. And the key is, when we take that first step, you know, we might have a loose idea, often not of what might be steps two, three, four and five, but it’s really through that first step that, you know, things start to happen, where in this case, your meeting a learning objective, you know, you sat down, you did the recording, obviously, there was some nudging in that process, you know, eventually it’s okay, we’re gonna edit this, we’re gonna share this, you know, and then they start snowballing. And obviously, through there, you start to build community, get feedback, validate the idea and start to evolve this into a business. And I’m so glad you mentioned mentorship, because it’s a critical reminder, for all our listeners out there that are precepting students, residents, fellows that are educators that, you know, sometimes we see something in someone, and it’s not until we can really slow down and have some of those in depth meaningful conversations that we can really help, you know, be the gentle nudge to help them – that learner  – see something that may, they may not even see themselves. And that’s really what I heard, you know, in your journey, that your RPD saw something in you that perhaps, you know, naturally as a resident, you may not always see in the moment. And I love that right, because I think that’s, that’s true for many, many stories, many journeys, where we can reflect back on a mentor, I’m thinking of several, as you’re talking that were so influential, and just action steps that I took, that led to other things, but it wouldn’t have been without their mentorship and encouragement from the start. 

Jimmy Pruitt  17:52

Absolutely. 

Tim Ulbrich  17:54

So Jimmy, if I’m following your journey correctly, your five plus years in as a creator with the podcast, creating content, three years or so with the Acute Care University, we’ll talk about the conference here in a little bit as well. And you’re still working full time in clinical practice. Talk to us about your decision to stay full time in practice, as you’re trying to also grow a business and what value that’s provided and challenges, I would presume as well. 

Jimmy Pruitt  18:23

It’s been unique, I would say, one of the things that we looked at is making sure I’m at that number, and making sure I don’t make the mistakes that I’ve seen other people do. And more importantly, make the mistakes that I’ve read about. The biggest thing that people say is like sometimes you have to just jump and you just have to do all these different things. And I’m like, I have a family, one. So that really kind of changes the dynamic. It’s not just me making this big shift, but I want to make sure that I was able to consistently get that number. And early on I end up saying once I’m able to make you know, one and a half times my my salary consistently, and my business can continue to function smoothly, then it will be a conversation of what I do from a full time standpoint. But I’ve noticed as I continue doing both of this, me being a business owner and being very focused as being the president, CEO, whatever the title you want to give yourself when you’re when you’re starting out, it actually made me a better employee. That was very unusual because I started going to work and said, Okay, understand the objectives that I’m trying to do, and understand how, what it feels like to have someone work for you. Yeah, and be able to accomplish these goals. So when I have conversations with  the board and with the administrators at my hospital, I’m asking the question, Hey, what are the KPIs that we’re trying to understand? And they’re like, What are you you’re a clinical pharmacist? I said listen, I can solve many problems. I realize the problems that you’re going to care about. And more importantly, I realize the problems that the person that report to you is going to care about. I’m going to help save people lives. I work in emergency department. That’s my fulfillment. How can I make this a, you know, a symbiotic relationship to where I get the resources that I want, but I’m also getting the things that you want me to get. So from that perspective, being a better employee has made it more enjoyable, because now I’m able to go in and solve problems and be able to find different things and have conversations that before I started being, you know, heavily involved in my company, I didn’t understand all the problems. I didn’t understand those problems. So as I looked at the component of making sure I’m meeting that output, that I need to be able to consider stepping back, I also realized there was so much more value, because now I’m able to understand other people’s problems. And  it makes me say, Hey, I may want to do this for a little bit more, because I’m able to do consultant work now where I can get brought in as a consultant for and ED pharmacotherapy, find different problems, and then say, Hey, I’ve done these things now, at certain institutions, and it opens up more doors for me at this point in my career, and I just don’t think that I initially thought that. Because I think everyone who goes into business initially thinks, oh, I’m going to work for myself, it’s gonna be great. I can wake up when I want to. It takes quite a while. But I’ve enjoyed the process. And I think as I look at all these things, what having a business and working full time has allowed me to do is cut a lot of this the skin out of my life when it comes to tasks that I don’t necessarily need to do. And it’s made it easier for me to focus on family, focus on activities, I want to focus on health. So I think having both of those has kind of put me in a position to where I have to stay very focused and enjoy, pick the things that I want to enjoy, and to glean different insights from situations knowing that there will be a transition at some point, yeah. But learning more at the job and understanding the problems that they have, and other people like them have, has made me be able to understand the market, and how I can potentially use that in the future. But more importantly, my skills as a business owner, has allowed me to be able to solve problems that early in my career, and earlier, you know,  in places I’ve been people don’t necessarily think about. So yeah, I’ve enjoyed it. There’s challenges, of course of not being able to take significant breaks and being able to have days where you just do nothing. But I think realistically, the continuation of doing it and seeing some benefits allow me to be able to do both, and be able to enjoy both. Because now I walk into the ER I don’t have to be a CEO today. I could just focus on this component and is vice versa. So I’ve enjoyed it. It’s helped with burnout. But I’ve really enjoyed the process. 

Tim Ulbrich  22:52

A few things you said there that I love, Jimmy,  that are worth highlighting, you know that the patience that I hear there, the intentionality in your thought process. You talked about a certain multiple of income one and a half times and you know, that that’d be in a place where maybe the conversation starts to shift, obviously, you and your situation – everyone’s entrepreneur journey is different, right. And I think there’s sometimes there’s this blanket, kind of advice or blanket type of idealism around entrepreneurship, which is like, jump in, and you’ll figure it out. You know, and it’s like, you know, for some people, that is their story. It’s not my story, wasn’t your story. But for some people it is. And I think for everyone’s situation, you know, it’s different. And some of the things you said really resonated with me as I had some crossover from full time work and the entrepreneurial journey. And it was several years in before making that transition. But the connection between, you know, the entrepreneurial journey and becoming a better employee, I felt that. I felt like I brought more skills to the workplace. I felt like it prevented burnout, right, some of the change in pace and environment and work and, and I think there’s something to be said, too, when you’ve got, you know, the business that’s growing, and all of a sudden your employment becomes this place of opportunity and learning and growth like, wow. I would argue Jimmy’s probably that much better of an employee and an asset. Like you’re you’re not dependent necessarily in that moment on that income, you know, as you’re building something else, and you’re able to really bring the value to the workplace, you know, that you can bring. So I think a lot a lot of wisdom there that you shared, as well as just continuing to build build the skills. Jimmy, as you have grown from content creator to solopreneur, to now building out a team. And we’ll talk again about you know, the conference here in a little bit in the logistics and all that’s involved, my mind is spinning partly because I’ve been through this journey as well. And I know that with that growth, comes fruit and comes challenges as you look into building a team and delegating and letting go. Just talk to us about that journey. I think it’s something we don’t hear enough about, as we often hear maybe more solopreneur type of stories but as you have grown and you built the team, what has been and some of the fruit what have been the challenges of that?

Jimmy Pruitt  25:02

I think when looking at growing a team and really get into that first step of, I want to bring someone else into this, especially when you’re talking full time employment. The very first employee that I hired a couple of years back was just my virtual assistant. And one of the first aspects I realized was a very big challenge of mine was, how do I explain what’s in my head that I do every day? I didn’t realize how challenging that was going to be, until I started assigning tasks and realized that that wasn’t necessarily what the output that I wanted. And I realized that it wasn’t necessarily the employee’s fault. It was really how I was able to give information and how I was how detailed I was able to be about what’s the purpose, how to get there. And then SOPs and having templates and all those things that people talk about that are not, the cool thing to think about are so valuable. And what it allows, it allowed me to do is be able to communicate more efficiently. When I first got into pharmacy, what are the key things that was very, you know, self conscious about my ability to communicate, because again, I grew up inner city kid, again, not necessarily being around many college educated people. Again, I’m one of like, six high school graduates in my family. So the way I communicated, it was, again, very different than the way I communicate on a daily basis now. It was something that was a very limiting factor for me. And I realized that I had to figure out a way to communicate better. And I really, I love to talk, I love to kind of do these different things. But as many people can probably hear, I have a Southern sudden tone, I still, you know, speak in a particular way. And I realized that in order for me to work better with other people, especially on diverse set of people, I need to translate that, translate that and technology has been phenomenal. Being able to voice to text has been the best feature I’ve ever had. So that took the initial challenge of communicating exactly what I wanted to my first employee. And it kind when I went back and edit it and went back and forth, that changed everything. Then going from there to next step was figuring out how can I not spend all of my time not doing this, in the next step was reading different books, educating myself as a, Hey, have that employee have them make the template. You know the output that you want, you know, what’s quality work for you now have them do that. And I think once I’ve transitioned from being the only person that produce the output, to try and to explain that and figuring out better ways to explain what I want to allowing the person who I’ve been working with now for over two and a half years to make the template because they do it well. That was a very long process. But I think it was one of the more unique and impactful things that I’ve learned through this process. And it went from a major challenge to being something now that I consider to be a very, you know, streamlined process. And now bringing other people on has been a lot easier because I have something and a have that he can I can show them as an output, but I can also provide them now templates, SOPs and things of that nature. So I think that’s one aspect that many people don’t speak of, or think about, but the books are out there, people don’t speak on it, and think about enough when they’re starting a business. And I everything you do, guys, if you possibly can record yourself, speak through it, dictate it and do it once. So you can always be able to reference back to it. That’s the one thing I would like to tell people and then realizing that you have to take some level of consideration depth that everyone is not going to do it the same way you do it every single time. You have to create a process that allows for them to get close, I say 75% as good as you are on a consistent basis.

Tim Ulbrich  29:02

That’s really good stuff, Jimmy. I’ve had similar experiences and I think often people run up into, you know, barriers where they start to grow, they might hire a contractor to hire employees, they run into some of the frustrations you experienced. You know, I think we’re you push through it, often people may retract and kind of fall back into this solopreneur model, which again, everyone’s build something for different reasons, different goals. But as you continue on this vision, being able to accomplish the vision you have will depend on Hey, what time, what tasks need to get done beyond that that Jimmy can do within a day which requires a team and processes and all the things that you mentioned. You’re sharing reminded me of the book, procrastinate on purpose by Rory Vaden. He talks about, you know, exactly this concept of, you know, could you do the task in 10 minutes, that’s going to take you you know, five hours, you document you could. but there’s a certain return on time investment Right, if if you do a repetitive task five times a week, that takes you 30 minutes, sure, it’s gonna take you a lot longer to train someone to get to the quality that you want. But over enough repetitions, especially those recurring tasks, if you can fight through that, you’re gonna have a lot long term benefit of the return on time. And so I love the share that you had there, I think is a great example of that. I want to ask you to zoom out on your business for a moment. And I think it’s sometimes it’s hard as the CEO, as the person who’s operationalizing, at times in the weeds, you’re in the midst of planning for a conference, I’m sure there’s tons of logistics things that are moving, it’s hard to zoom back out to that 20,000 foot view to say, Where are we going? And why are we going in this direction? And so, Jimmy, as you zoom out and look at all the things you’re doing across the content, and the podcast, the PACU, the conference, the various educational products, the offerings that you have, what’s the five to 10 year vision? Where do you see the growth going, as you look at all these things you started and now you move into this this next phase of growth?

Jimmy Pruitt  31:10

That’s a great question. And I do this every once a while and I had to force myself usually, every every quarter, I tried to do it. Sometimes better than others. The big thing that I believe that I’m trying to accomplish over again, this next five to seven years is to make this to where we have one unified goal and mission we’re trying to do: provide high quality education related to pharmacotherapy. How do I go from many different products, many different services, many different things to one umbrella company that can be operationalized by other people consistently and provide that value that we started out with, and, and being okay, not knowing each individual step to get there. So I would love to say in in five years that I’m in a position where I’m sitting on a few boards, I am the one who makes the final checkoff. But I want other pharmacists that have this, this passion, to be able to impact people through education, to be able to monetize their expertise to have a home. And I don’t necessarily feel that there’s a huge home for that now, there’s opportunities to volunteer your time, there’s opportunities to be part of other organizations, things that nature, but I believe that there’s I should say, there’s not an abundance of homes for pharmacists, and those who engage in pharmacotherapy to share, monetize their expertise. I want to provide a home for those individuals and I want I want them to be able to have a home, whether they’re gonna be the consumer, or the producer. I think that those is the things that push me forward and figure out how can I add more people to my team to add that passion? How can I make sure that we do this, and I feel good about it, because at the end of all of this, the one main thing that’s going to happen is improved patient care. So for me, when I think my business perspective on that, I feel much better knowing that the very, very end end goal and very in any user of this, the recipient of all the things we’re doing is going to be someone getting the right drug at the right dose at the right time. And doing it in the right way. Yeah, so for me, I want to provide a platform that I’m leading, or that I’ve led, that’s going to be able to influence patients by those who expertly use pharmacotherapy.

Tim Ulbrich  33:42

What I love about that we haven’t talked too much about that on this episode is I’m a firm believer in having a strong anchor in your business of a why behind everything you’re doing, because through the ups and the downs, you’re going to have to rely on that anchor. And when you talk about everything pointing towards improved patient care, wow, that connects all the dots of everything we’ve been talking about, right? Because building a team, delegation, getting comfortable with that space, and, you know, may not always be done the same way that you do it in here community! Community of the consumer. Community of the Creator. Like, wow, the urgency of that is important, right? Because that’s all aligned towards being able to have more people in this community, creating in this community, as well as getting information and benefiting from the community, all pointing towards improved patient care. Like that, I just hope everyone hears that that is thinking about an idea or has a business that when you have that type of compelling torch of a vision and a flame. It provides so much clarity. I’m not saying it’s gonna be easy. It provides so much clarity of where are you going and why are you going there and that is so critical when you’re building something and not every business can say that. To have that type of clarity of vision and that type of clarity of messaging. I love that. Absolutely love that. Let’s talk about the Empower RX Conferene coming up April 26-27th in Charlotte, I’m really excited about our collaboration surrounding this event. I’m looking forward to have the opportunity to meet your community there live in Charlotte. And I suspect that we have several listeners that have different areas of clinical expertise that maybe are in acute care and are going to be attending the event. Maybe they’re brainstorming other educational opportunities in their own niche. So tell us more about the event. How did it get started? And how is it evolved to the current state?

Jimmy Pruitt  35:27

Absolutely. EmpowerRx has been just another brainchild of wanting to improve patient care. But realizing again, we sort of go back a couple years ago and realize the history of emergency medicine. Again, we had three PGY2s in emergency medicine back in 2004. I’m starting one this, we’re over 119, I believe, in 2020. So I think as we look at the number of the growth that’s there, we realized that not every aspect of emergency medicine pharmacotherapy has been able to catch up. One of the areas that I remember mentioning, as we made Pharm So Hard was that there wasn’t a place for us to come together, hang up talk about just emergency medicine, versus just having a 10 minute Pearls or just having a 60 minute session with a few presentations. That was you know, spread out dispersed amongst the major organizations, they’ve done a phenomenal job of providing resources, and helping us grow the specialty. But I wanted to provide a place that it was very unique to emergency medicine pharmacists. And if you know anything about us, if you’ve had, if any listeners are part of, you know that you have to be a certain type of personality to consistently work in emergency department. And I wanted to provide a space for that. So I remember sending a text message to Kyle Wendt, he was he was at MUSC at the time, and saying, hey, what if we just created our own conference? And what if we just made it to where it was? It was like, it wasn’t like any other from a professional standpoint, what if you just you didn’t wear dress clothes? What if you didn’t come there at a tie, you came there and a T shirt, some jeans, and you just was having a good time. And we just spent all day talking about things that really impact emergency medicine pharmacotherapy, whether it was clinical, or whether it was the social components. There’s a lot of things that happen in emergency medicine on a day to day basis that there’s it’s not in the textbook. You don’t know how to have the interaction with the one mean nurse. You don’t know how to, you know, make sure that you’re able to think quickly when that patient comes in, that’s unannounced. We want to provide a place where we can talk about those things. But also, can we be ourselves the same way we are at the bedside. Because many ER pharmacists will tell you, when we go to the actual pharmacy area, there’s a certain persona that we we uphold when we talking to our superiors. And there’s what happens in the ER when we spend the majority of our time with nurses, physicians, EMTs things that nature. So I wanted to provide that environment, that community. And we sent this out in 2020. And we want to figure out, how can we do it as for us and by us, instead of someone else creating it and thinking they know what we want. Why don’t we just create it from the ground up? And that really was the initial phase of this. And it led to us being able to create an environment where we speak on many aspects of acute care pharmacotherapy, particularly again, the resuscitation part of it. So whether you’re a central pharmacy that responds to cardiac arrest, we have information there for you whether you’re a nurse who just happened to be interested in the drug component, we have something for you. So I think we are a emergency medicine pharmacotherapy conference. And we’re not necessarily a EM pharmacist conference in a say. So I think it kind of brings together our world in one place over two days, and the initial one was going to be virtual, because again, COVID definitely has something to do with that. And then last year, partnering with SAEM. And we got to see a sense of it. But I think that the next phase was okay, we keep saying that we’re for us, and by us, we have that everywhere. This is the first year we’re going to do everything completely in person, have some virtual access and completely be for us and by us and we grew our team tremendously to build something that again, it’s for all of us. And when I say us, that can be a physician, that can be a nurse, that can be anyone in that space, but you now have a home to discuss pharmacotherapy. 

Tim Ulbrich  39:24

I’m really excited to experience it. I’ve been to many, many pharmacy conferences, but I’m sensing there’s something different, something unique about this, and I can’t wait to be a part of it. Hopefully the emergency medicine folk will allow me into the room. It’ll be a good, good, good chance to interact. And I’m really looking for it’s another great example to me, Jimmy, of something that, you know, you obviously had interest built up in a community and following at the point of when you launched that first one, but you still had to take that first step, right. And sometimes that means success. Sometimes that means failure and certainly you’re going to learn and grow from it. And I can hear the evolution that the conference has taken the last several years. So really looking forward to being a part of that. And I just as we wrap up, Jimmy want to say I admire and I mean this wholeheartedly admire, what you’ve built, why you’ve built it, how you built it. I love the niche focus. I love the clear messaging you have, there’s a strong sense of community. And there’s a strong anchor back to the vision of why that you’re doing and that that is the recipe for success in my mind as people are thinking about building a business. So, Jimmy, thank you so much for taking time to come on the show. I appreciate it.

Tim Ulbrich  40:29

As we wrap up today’s episode, let me remind our acute care healthcare listeners about our partnership with the 2024 Empower Rx conference, a leading event and emergency medicine pharmacotherapy. This year, it’s happening in Charlotte, North Carolina on April 26, and 27th. I’ll be there and hope to see you there as well. It’s ideal for pharmacists, physicians, PAs, nurses and others in the field. The Empower RX conference offers more than 10 CPE credits, insights from top experts interactive workshops, and groundbreaking research. It’s not just a conference, it’s a community focused experience fostering learning and networking in a welcoming environment. Take advantage of discounted registration available to the YFP community by using code YFP2024 for 15% off. Again, that’s code YFP2024 for 15% off you can join in person or virtually register now at EmpowerRx-conference.com and elevate your emergency medicine skills. Again, that’s EmpowerRx-conference.com.

Jimmy Pruitt  40:29

Thanks for having me on, Tim.

Tim Ulbrich  41:32

 As we conclude this week’s podcast and important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding materials should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. Furthermore, the information contained in our archived newsletters, blog posts and podcasts is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analyses expressed herein are solely those of Your Financial Pharmacist unless otherwise noted, and constitute judgments as of the dates published. Such information may contain forward looking statements which are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward looking statements. For more information, please visit yourfinancialpharmacist.com/ disclaimer. Thank you again for your support of the Your Financial Pharmacists Podcast. Have a great rest of your week.

 

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YFP 343: Getting Ready for Tax Season with Sean Richards, CPA


Tim Ulbrich and Sean Richards, CPA, discuss the tax preparations listeners should be considering ahead of the 2023 filing.

Episode Summary

In this episode, Tim Ulbrich and Director of YFP Tax, Sean Richards, CPA, discuss the tax preparations listeners should be considering ahead of tax season and the 2023 filing. Whether you DIY your taxes or work with a professional, there are documents that need to be on hand to file your taxes. Sean shares essential tax moves for the year, emphasizing the significance of being proactive for the 2024 tax season. Sean also discusses the value of a year-round approach to taxes and the in-house services by episode sponsor, YFP Tax, showcasing the value of personalized, holistic tax planning.

About Today’s Guests

Sean Richards, CPA, received his undergraduate degree in Corporate Finance and Accounting, as well as his Master of Accountancy, from Bentley University in Waltham, MA. Sean has been a Certified Public Accountant (CPA) since 2015 and is currently pursuing his Enrolled Agent certification. Prior to joining the YFP team, Sean was the Senior Treasury Manager at PRA Group, a global debt buyer based in Norfolk, VA. He began his career at American Tower Corporation where, over 10 years, he held several positions in audit, treasury and accounting. As the Director of YFP Tax, Sean focuses on broadening the company’s existing tax planning and preparation operations, as well as developing and launching new accounting offerings, including bookkeeping, payroll, and fractional CFO services.

Key Points from the Episode

  • Tax preparation for 2023 with a CPA. [0:00]
  • Tax moves for 2023 and preparation for 2024. [1:11]
  • Tax planning and preparation strategies for individuals and businesses. [8:56]
  • Tax season preparation and changes. [13:59]
  • Tax planning and goal setting for next year. [16:56]
  • Comprehensive tax planning and year-round approach to taxes. [22:25]
  • Year-round tax planning and personalized service. [27:24]

Episode Highlights

“And the big thing I’ll say about extensions is that the one of the things I’ve been noticing over the past few years is that there’s just this stigma about extensions, and how you know, a lot of people have never done it before. And it seems like it’s only something you can do if your situation is complicated. And it’s only something you can do if you are working with a professional and they need to do all the work for you and everything. But really extensions just give you and give your preparer more time to get things figured out, make sure that you are taking advantage of all your deductions and credits and everything.” – Sean Richards, CPA

“As Tim Baker would say, when it comes to extensions, right over rushed right over rush, right.” – Tim Ulbrich

“Yeah, I would be, you know, thinking about your own kind of general financial goals and then try to think about as you’re going through this whole tax filing process, how does your tax situation align with those goals?” – Sean Richards, CPA

“With comprehensive tax planning, is just looking at your taxes kind of throughout the course of the year like I’ve been alluding to throughout this whole conversation. And one big thing there is will be kind of what you were just saying that filing taxes. It’s not always really the finish line and might also be the starting point for somebody else.” – Sean Richards, CPA

“But with holistic plan, you have your tax return that you start with whatever is etched in stone sent to the government. And then from there, you’re able to sort of do whatever with testing out different types of scenarios and projections and looking at, hey, let’s take a look at our paychecks year to date, let’s see where are withholdings are at, let’s see what we expect our side income to be and our rental income. And oh, we’re going to have a kid this year congrats and, oh, we’re buying a house, let’s see how all these things play into our tax situation in the middle of the year.” – Sean Richards, CPA

“So there’s just so many different opportunities to, you know, maximize your efficiencies with your taxes, you know, take advantage of all the things that are out there. And if you don’t have a year round kind of approach to it, and you’re not looking at it in a cyclical kind of way, you’ll miss those things, you’ll come to filing, and you’ll be kicking yourself saying, let’s do it better this year, let’s do it better this year.” – Sean Richards, CPA

“So the name of the game with those is energies. Definitely still the big biggest thing. Energy efficiency, green initiatives. So people typically immediately think of EVs. I mean, that’s that’s a great example. And that’s one where the credits are sort of just getting better every year, there’s, more available to you” -Sean Richards, CPA

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

Tim Ulbrich  00:00

Hey everybody, Tim Ulbrich here and thank you for listening to the YFP Podcast where each week we strive to inspire and encourage you on your path towards achieving financial freedom. This week YFP Director of Tax and CPA Sean Richards joins the show to discuss getting ready for the 2023 taxes. Yes, it’s that time of year tax season is officially upon us. And you probably started to receive various tax forms in the mail that are piling up if you haven’t already done so now is the perfect time to switch gears and start getting ready for the 2023 taxes. If you aren’t sure where to start, we’ve got you covered with a free checklist to help you along the way. In this free checklist we cover three final tax moves that you can make for the 2023 tax year, four ways to start prepping for tax season, and three key items that you can be doing now to plan ahead for this tax year and beyond. If you’re ready to take action and set the stage for a successful 2023 taxes, you can download this free checklist at yourfinancialpharmacist.com/taxchecklist. Again, that’s yourfinancialpharmacist.com/taxchecklist. 

Tim Ulbrich  01:09

Sean, welcome back to the show.

Sean Richards  01:10

Thanks. Thanks for having me. And thanks for allowing me the chance to get on here before I disappeared. And hopefully I can spread some knowledge to folks again before I kind of go into my hole for the for the spring and start getting into the fun stuff that I live for.

Tim Ulbrich  01:26

Tis the season, hard to believe here we are and end of January thinking ahead to tax season. And we’re really excited about the work that you and the tax team are doing. We’ll get into that as we get towards the end of the episode. But we want to use this time of the year really as an opportunity to make sure that our community, our listeners are focused as early as they can on getting prepared for the tax season, whether they’re hiring a pro, like YFP tax, whether this is a DIY type of solution. You know, this is the season where we start to see those forms showing up in the mail, we put them aside on the desk. And then we want to do everything that we can to get ready. So we’re going to talk about in this episode, Sean, some some final tax moves that folks can make here. Even though we’re in 2024. We’re doing the 2023 filings. So some final moves that they can make. We’ll talk about getting ready for the tax season, how they can be prepared to make sure that the filing goes as smooth as possible. And then we’re to start the conversation about –  as we’ve highlighted many times before on the show – we want to be as proactive as possible. So how can we be thinking ahead to the 2024 tax filing here in the beginning of the year, again with that proactive strategic approach. So before we jump into the meat of each of those sections of the podcast, Sean, just remind us of the deadlines. I think folks are probably familiar overall. But you know, we see more people in our community extending. So I think it’s worth talking about that as well. What are the deadlines that folks need to be thinking about this time of year as it relates to tax? 

Sean Richards  03:01

Yeah, I mean, the big deadline that people typically are familiar with his tax day, and that’s usually April 15, which is this year, sometimes it falls on holidays, or, in fact, sometimes I’m from Massachusetts, and it often falls on a Massachusetts specific holiday. So we get a little bit of an extra push there that other states didn’t get but not not afforded to that anymore. But that mid-April date is typically the the regular sort of Tax Day date for regular individual filers, assuming that there’s no extension that’s filed. And the big thing I’ll say about extensions is that the one of the things I’ve been noticing over the past few years is that there’s just this stigma about extensions, and how you know, a lot of people have never done it before. And it seems like it’s only something you can do if your situation is complicated. And it’s only something you can do if you are working with a professional and they need to do all the work for you and everything. But really extensions just give you and give your preparer more time to get things figured out, make sure that you are taking advantage of all your deductions and credits and everything. And that bumps your regular tax deadline from April all the way to October. It’s six months. And it’s a guaranteed thing, basically. I mean, almost every state falls the Fed. And if you do the extension with the Fed, it’s guaranteed as long as you make a payment against any, you know, expected bills you’re gonna have. It’s just it’s worth doing. We do it for all of our clients proactively. That’s something we’ve been rolling out over the past couple years is just getting ahead of that, get it filed. And that way you don’t have to worry about it. You know, you can take your time figuring out if you think you’re going to owe any money, make an estimated payment, and then spend however much time you need to just dot all the i’s and cross the T’s and get everything figured out. You know, it’s what we see a lot of folks doing nowadays, it’s the way the industry is heading. So those are the two big individual deadlines. And if you’re a business owner and you actually have to file a business return, basically shift that up a month. Yeah. On March 15, and September, if you extend out.

Tim Ulbrich  05:03

As Tim Baker would say, when it comes to extensions, right over rushed. Right over rush, right. So I think when we look at tax season, you know, there’s a lot of work crammed in a short period of time, and we want to make sure that we’re doing it right. And that we’re, you know, optimizing the tax situation the best that we can. So let’s jump into the first section, first part of our discussion, which is some final 2023 tax moves that our listeners could make may or may not make sense, obviously, depending on their individual plan. So Sean, even though we’re in 2024, calendar year, there are some actions that can still be taken for the 2023 tax season. What are those key ones that our listeners should be thinking about? 

Sean Richards  05:47

Yeah, and it’s one of those things that you always want to try to be doing things in the calendar year if you possibly can. But there are things that you aren’t going to be able to do by the end of the year. You know, some of these things with retirement contributions and stuff, you’re gonna want to know what your AGI is, or what you expect it to be. Or you might have to find out kind of what kind of cash flow you have available for yourself to make some of these different types of contributions and things. But right, so the IRS actually does allow some actions to be done after the tax season, when typically, if you’re a cash basis, taxpayer, it’s sort of whenever you get that cash, that’s the year that it happens. And so the big ones are retirement contributions, IRAs, specifically, those go out to your your regular deadline. So typically, it’s going to be April 15. For folks, the one I’ll mention there is that aside, for some exceptions, with some solo plans, 401K’s that’s typically a year end kind of thing. So if you didn’t max out on that, you probably don’t have much of an opportunity there. But again, you do have the opportunity to contribute to an IRA. So that’s something to look into. And I mentioned a solo 401K, but if you’re doing anything like that, or a sep IRA, those actually can be extended out if you have an extension. So another reason to file that extension, by yourself six more months to figure out where you’re gonna land, what kind of cash you have available to make a contribution towards something like that. And then the other big one is HSAs, very similar IRAs, it’s it goes to your your April deadline. So if you didn’t hit your max, or if your company contributed, but you still have some room to hit the max there, definitely tried to hit that that the HSA, I say it all the time, but it’s one of the few things that has the triple tax benefit of tax free contributions, tax free distributions, and tax free growth. So big one there. And then the other one is it. So it’s a little bit more, I don’t want to say complicated, but it’s, you know, not typically something that folks that are just having a regular kind of basic W2 job experience. But I was alluding to it before when I mentioned extensions, and that’s making estimated tax payments. So if you’re on a quarterly cadence where you know, your withholdings aren’t covering off on your tax bill, at the end of the year, whether you have side gigs, or it’s by design, you should be making estimated payments, those actually would have been due on the 15th of January. So hopefully, if anybody’s listening in, they’re supposed to make q4 payments and didn’t this will be a little reminder to go do that. But the other thing to keep in mind there is that even if you’re not making estimated payments, if you’re expected to have a balance due in April, you’ll want to make a payment against that before that date. So even if you do extend out, you know, get a rough number, do the math say hey, I think I’m going to owe approximately $1,000 make that payment now or any time between now and April. And then like I said, take the time, get your return figured out maybe that 1000 becomes 800. And you get to 200 of it back or, you know, you just buys you that time to really get things figured out. But you have the ability to make payments early anytime now for the 2023 season.

Tim Ulbrich  08:56

Yeah, and I think it’s really important. You know, for those that have been at this for a while they’re they’re probably well plugged into, hey, I can make IRA contributions after the first of the year, right before the deadline. I can make HSA contributions, but especially for, you know, our listeners that are relatively new at filing their own taxes or working with someone they may think which would be common sense that hey, calendar year is over. Therefore, opportunity’s gone. And as you’ve highlighted, that simply isn’t the case. And Sean, I also want to put a plug in when it comes to estimated tax payments -you mentioned this being a little bit more nuanced – and I think especially for those that have some more complicated tax situations, we’ll come back to this at the end. You can feel overwhelming in terms of you know, how do I determine that what’s the amount am I doing that correctly? What what changes are happening? And so I think this is a spot we’re really working with. Someone can be really valuable to feel comfortable and confident that you’re making those estimated tax payments. Yeah, in the correct way.

Sean Richards  09:50

We send out reminders to everybody that’s on that cadence and it might as well just be a reminder back to me because you know, all of our clients basically just say, I pay But we have the tools to go in and just you know, we have that number already figured out ahead of time. Usually it’s a little back and forth of hey, yeah, everything’s still the same, business still doing the same, you know, any changes on things, and we update our projections and get those numbers. But yeah, if you ever if you expect a big tax bill, or really have any kind of income, that you don’t have withholding for, that’s something you really should be thinking about. And if not working with a professional, at least having a plan to know what that number is going to be for yourself.

Tim Ulbrich  10:26

I get that email too from you, Sean. And then I say, hey, Sean, well, why don’t What is that supposed to be? So….

Sean Richards  10:31

I always push back a little bit to Hey, Tim, tell me about this. 

Tim Ulbrich  10:34

Yeah, that’s right.

Sean Richards  10:35

He’s telling me to go check the books, so we go back and forth.

Tim Ulbrich  10:39

Awesome. So that’s the first part we want to talk about is making sure that we use this window of time right to make any of these 2023 tax moves before we file. The second part is getting ready preparing for the 2023 tax season. So Sean, we preach and teach proactive tax planning. And we’ll talk about that here shortly. Most of the focus this time of year is getting ready to file for the previous year. What are some things that our listeners can be doing should be doing to get organized, and be prepared for filing, whether they’re doing it themselves, or again, they’re hiring a tax professional.

Sean Richards  11:15

Yeah, whether you’re doing it yourself or hiring a tax professional, you’re gonna need to gather the documentation and either have it for yourself or give it to somebody. So that’s the big name of the game right now. So knowing when you’re going to get things, you know, a lot of that is you’re sort of at the mercy of whatever businesses you’re working with. So if it’s a bank, and you have interest income, there’ll be sending out 1099s. If you work for a company, and you get a paycheck, there’ll be sending W2s, the deadline for most of those is January 31. So folks are probably starting to get them in the mail now, if they have a little bit more proactive payroll companies. 1099, typically, they’re due on the 31st are most of them are and you’ll see those right around the 31st. Because those are a little harder to get out. But there’s other things that you can be gathering now to that may not actually have sort of deadlines that are going to be issued by a company, but things that you can pull together yourself. So if you have a rental property, you know, have you been taking income and expenses and have all that stuff figured out? Or if you work with a property management company? Do you know how you can go get that? Do you have a side business? Have you been tracking income and expenses there, you know, if you bought a house or sold a house this year, you’ll probably have the closing documentation and everything and that stuff that you’ll need or again, your accountant will need. So one good way to start is to just look at what you did last year and kind of figure hey, I needed all these things last year, I’ll probably need those again. And then think what did I had as a change this year? And you know, what could that possibly bring up? Having a system in place is great, you know, if you’re a client of ours, we have a tax questionnaire that I’m sure listeners are rolling their eyes saying, Oh, no, not again this year, though. I do promise it’s a lot prettier than it has been in the past. I’m really excited about some of the changes we’ve made there. But you know, it really guides folks through Hey, did you have this happen? Did you have this happen? Things that you might not think about. Hey, Oh, I did. I forgot I sold that stock in January of 2023. Right, of course. So just kind of understanding what situations you had in your tax life for the year, what forms may or may not be needed from that. And then when you’re going to be getting them and who you’re going to be getting them from. And sometimes it’s not even things that you’re going to be getting right now. Like I mentioned, if you have a business and your partner with that a business or an S corp or something, you might not get your K1 until September 15 when that extensions due. So there’s a lot of things for planning purposes, you know, if you know that you are a shareholder of a business, you’re going to want to file that extension now because there’s a good chance you’re not getting that until the summertime or something like that. So it’s a lot to think about. It might be overwhelming for folks. That’s why it’s you know, really good to have a system or work with a professional. But starting with last year is always a good place to start. 

Tim Ulbrich  13:58

Yeah. And I found that to be really helpful. I use a combination of what you said. So I have a Google Drive, you know, folder for personal, for business, and I separate it by year. And then as those forms come in, you know, I’m scanning them, I’m dumping them into a folder just to kind of get them out of my mental space. And then exactly what he said, right, so I’m going through the tax questionnaire, which is super helpful to not only, you know, remind me of, okay, what were the forms last year that maybe I haven’t yet gotten or, you know, whatever, I need to look into that further. And then also asking those questions of are there new things that happen this year, and things that I need to be nudged and reminded of that might not have been represented in the documentation from the previous year? So I think a combination of the factors that you said, but that questionnaire I really like because that’s kind of the force point of are not only answering the questions, but then that’s the cue to upload all my tax forms and make sure that we have every documentation that’s needed, according to the questions that are being asked. 

Sean Richards  14:59

Yeah, and like I said people are probably rolling their eyes. And I don’t mean that because the questionnaire itself is bad. It’s more that people are probably thinking, Oh, no, I have to gather those documents again. But unfortunately, everybody has to do that regardless. So you might as well have something that’s going to guide you through and remind you. It’s nice because like I said, our system is battle tested, we’ve had it for years now. You can put things in and save it and come back. So if you say, Ah, right, I forgot I had that transaction in January of 23. I mean, we’re already a year past that, when you’re filing, we might be a year and a half past. So it’s always good to have that little reminder to go back and get things. 

Tim Ulbrich  15:36

As we’re talking about getting ready for the tax season. And the filing that’s coming up whether you know, that’s going to be the standard date or an extension. You know, the other thought I have here, Sean, is what new tax changes have been happening that folks, maybe or maybe not plugged into. And I feel like in years gone by, there’s been a lot more activity than than there was this past year. But talk us through some of the things that you’re seeing with our clients that our listeners might want to be tuned into.

Sean Richards  16:04

Yeah, I would say ’23 wasn’t the craziest year. I mean, it could just be with the election kind of coming up, maybe a lot of waves didn’t want to be made. But it also obviously comes down to Congress having to get things passed and making it through all of the checks and balances in the system. So we did have a lot of changes with the Inflation Reduction Act a couple of years ago that are kind of starting to roll out over the course of time. So I’d say that those were probably the biggest, year over year changes as far as actual real changes of like, Hey, this is a new creditor, this is a completely extended credit that used to, you know, phase out at $500. And now it’s 30%. with with no limits. So the name of the game with those is energies. Definitely still the big biggest thing. Energy efficiency, green initiatives. So people typically immediately think of EVs. I mean, that’s that’s a great example. And that’s one where the credits are sort of just getting better every year, there’s, more available to you. But even things that folks might not be thinking of. So if you had worked done on your house, there’s a pretty good chance that whatever you did was considered energy efficient by the powers that be and may qualify for at least some type of credit. So it’s worth at least thinking about, hey, I did this project, I replaced a window or I, you know, did some roof work or something like that, even just to ask the question of, Hey, can I get something for this? Worst case scenarios the answer is no. But you know, maybe next year or something. Aside from that, like I said, there weren’t a whole lot of crazy changes, there was a lot of increases across the board, just due to inflation with things like the standard deduction, and all of the kind of income brackets and everything. That’s not, you know, unusual, but it was a little bit more than it has been in the past, just given some of that inflation. And then there’s some new reporting requirements that know people are definitely getting fired up about. 1099k is a big one that gets thrown around a lot. So that’s with third party processors, if you work with like, Venmo, and things like that, and it scares people, because the question I get a lot is, hey, I, you know, send my dad 50 bucks every month for my cell phone bill, am I is he gonna get a 1099 at the end of the year for something like that? And the answer is probably not. The idea behind that is that third party payment providers, credit cards, Venmo, things like that are supposed to be identifying business transactions, because you know, you have that little button, you can click if you’re in Venmo, this is a business or purchase. And it gives you the insurance and everything, but it’s more intended for things like that. That’s not to say that you may get a 1099. Or it might come out of something like that, if you did give your family member $6,000 for something over the year. But that doesn’t also necessarily mean that it’s going to be income to that person. It’s just the company letting the government know, hey, this is the money that moved between these people. So a lot of things are getting thrown around. And you know, companies are trying to get people excited. So they’ll, you know, listen to their services and things like that. But I don’t want folks to be scared about these things. But definitely, you know, be inquisitive, ask your accountant, ask whoever you’re working with, hey, does this apply to me or you get something in the mail, ask them about it or you know, run it by somebody, don’t just say, Hey, I don’t think this applies to me. I’m not going to worry about it and deal with it later. 

Tim Ulbrich  19:26

So thus far, Sean, everything we’ve talked about is really for the upcoming filing, again, whether that’s April or whether there’s an extension in October, so let’s shift gears to talk about thinking ahead to next year. So the 2024 tax filing. And again, even though we haven’t yet filed for 2023, we’re making decisions right now that are going to impact that filing. So we want to be thinking and planning as proactively as possible. And this is a great time of year to be doing it. So what are some of the areas, Sean, that folks should be thinking about here for next year’s filing in 2024. 

Sean Richards  20:00

Yeah, I would be, you know, thinking about your own kind of general financial goals and then try to think about as you’re going through this whole tax filing process, how does your tax situation align with those goals? Or does it and if it doesn’t, should it and can we kind of shift it that way. So it could be something of, hey, I really want to pay off my student loans this year, that’s my my number one thing is that that’s what I want to do. So you might be more inclined to, you know, get more money in your paycheck in a particular year, in order to take that money and pay it against your debt, versus somebody who’s saying, hey, my number one goal by far is to lower my taxable income. And if that’s the case, you know, you don’t care about having your student loans paid off, or maybe you don’t have student loans, you just want your taxable income as low as possible. So we’re gonna max out 401K, we’re gonna max out HSAs or kind of, you know, do any of those types of things. So this is the time to really figure that out. Set goals for your tax situation that apply to your financial situation and overall strategy and also kind of come out of your tax return. Did you do your tax return and say, Oh, crap, I have a huge bill this year, I don’t, I don’t want that to happen. Or vice versa, oh, my goodness, I am getting a huge refund, I certainly could use that $1,000 a month back over the course of the year. This is the best time to identify those types of things and set those goals. And then from there, you can start to make changes, you can you know, if your goal is to not have a big tax bill at the end of the year, you can adjust your withholdings now and have 12 or 11 months of that to take effect. And by the end of the year, you’ll probably be in a good place. Or again, if you want to get more cash back to pay off your student loans, you can adjust your 401k or vice versa you want to lower your taxable income as much as absolutely possible, max out 401k. And now you have 11 months of that to go through. So it just a really good time to kind of get those goals set in place. Think about how you’re going to get there work with somebody who will build out a roadmap to get you there. And then just start checking in throughout the course of the year. It’s one of those things that once you file your taxes, I know everybody wants to say that they’re done. And it certainly is something you should celebrate. But it doesn’t mean that you should put it aside and not think of it till next year. Get those goals figured out now. And then, you know, constantly check in and make sure that you’re still on track.

Tim Ulbrich  22:25

Yeah, I like to think and we’ll talk about this with the services, we offer at YFP Tax. But I like to think about the filing is really the start line and not the finish line. Right. And, you know, as we talked about, in the very first section of this episode, there are some things that are calendar year deadlines, right? So we want to make sure that we’re taking advantage of those here in 2024. If it’s suitable for your plan, so that we’re not chasing it, you know, a year later, right, we’re able to really take advantage. And I think, as you mentioned, and highlighted well: it all starts with their goals. And this is why I’m so excited about the combination that we have of CFP and a CPA. When when you’re doing financial planning, and you’re doing that one on one and you have a CPA in your corner. That combination is really powerful as we can look across the financial planning and the strategy there, and then make sure we’re doing it in as tax efficient manner as possible. And just as a reminder, as I mentioned at the intro of the episode, we’ve got a checklist to kind of help guide you some of the things that we’ve been talking about, you can get a copy of that free checklist at your financialpharmacist.com/taxchecklist. And we’ll link to that, again in the show notes. Sean, let’s shift gears as we wrap up and talk about what we do at YFP Tax. Why we do it. By we I mean you!  The philosophy, the philosophy, the philosophy behind this service and I think it’s it’s such a good thread to what we’ve been talking about. Yes, we’ve got work to do. We’ve got to file the IRS says we have to do but we also want to be thinking ahead and thinking proactively so we’re really excited. We’re now more than a year in of the shift we’ve made to offering comprehensive tax planning what we call CTP in-house. Tell our listeners, what is comprehensive tax planning and what does that offering look like at YFP Tax.

Sean Richards  24:16

Yeah, I’m excited too.  It’s been you know about a year like you said of kind of having this as the flagship offering that we have on the tax side and it you know, I love where it where it’s been and where it is now and I love even more where we’re planning on taking it this year. But yeah, comprehensive tax planning, is just looking at your taxes kind of throughout the course of the year like I’ve been alluding to throughout this whole conversation. And one big thing there is will be kind of what you were just saying that filing taxes. It’s not always really the finish line and might also be the starting point for somebody else. It also is you know, could be the sort of middle of the year depending on what you have going on. Not everybody is on this exactly perfect cyclical cycle of hey Q1 of the year, which is this January, February, March, I’m going to be doing my full tax filings. And then mid year I’m going to be, you know, everybody, depending on what you have going on might be at different points in their individual tax cycle at any kind of point in the year. If you’re a business owner, you might not be filing your taxes until September, October. And then you know, you can’t be thinking about filing at this time of year when you’re going to be six months away from it. So comprehensive tax planning is really just having kind of a year round approach to your taxes and really catered to what you have going on. So again, where you’re at in the year, if it’s if it’s tax filing season, that’s what we’re focused on. If it’s more of that, you know, six months away from tax filing, we’re doing what we call tax projection. So we use a tool called holistic plan that we really use for our end to end tax process, which is amazing to have it all kind of in one place that we can carry over year after year. But with holistic plan, you have your tax return that you start with whatever is etched in stone sent to the government. And then from there, you’re able to sort of do whatever with testing out different types of scenarios and projections and looking at, hey, let’s take a look at our paychecks year to date, let’s see where are withholdings are at, let’s see what we expect our side income to be and our rental income. And oh, we’re going to have a kid this year congrats and, oh, we’re buying a house, let’s see how all these things play into our tax situation in the middle of the year. So we don’t come to whenever we file and say, Ooh, you know, I covered off on 75% of my stuff. But I kind of forgot about this whole other 25% here. So like I said, I love the projection process, I’m really excited to get into returns now and see exactly how accurate we were with them. And, you know, areas for improvement too. And not necessarily that we might have made mistakes or anything but looking at, hey, last year, we were really focused on the side income, but you know, you had more of an opportunity to be putting money toward your 401k and your W2 job that you had on the side there. So there’s just so many different opportunities to, you know, maximize your efficiencies with your taxes, you know, take advantage of all the things that are out there. And if you don’t have a year round kind of approach to it, and you’re not looking at it in a cyclical kind of way, you’ll miss those things, you’ll come to filing, and you’ll be kicking yourself saying, let’s do it better this year, let’s do it better this year. 

Tim Ulbrich  27:24

I think he’s you articulated so well. We’ve really designed the service to match the philosophy we have right, which is tax is not one and done. It’s something we need to be thinking about throughout the year to really optimize this part of the financial plan the best that we can and I think the service does that incredibly well. And we do recognize Sean, that CTP comprehensive tax plan. We recognize that it’s not for everyone, right. So you know someone who is listening that, you know, is single, they’ve got one W two income, that withholdings are clean set correctly, there’s not a whole lot of changes, they probably aren’t in need at least yet. In terms of year round tax planning service. So with that in mind, who are you seeing with the clients that you’re working with YFP Tax that are getting the most value out of this year round service? 

Sean Richards  28:11

I would say overall, you know, if you have a kind of a basic situation, that’s not typically the client that we’re seeing coming on and getting the most value out of it. That’s not to say that we don’t have plenty of people who want comprehensive tax planning, just to be able to say, hey, I don’t want to think about it. I just want someone’s hand on the wheel. And I want someone to take a look at my paycheck at the middle of the year and say, Hey, we’re still on track to have a $0 balance. And you know, we’re all good thumbs up and everything. There’s plenty of those. But I will say that the majority of folks are probably those who have slightly more of a complex tax situation or more of a complicated tax history or a little bit of both. So complicated tax history, think of things like big refunds or big bills, like I mentioned before, like, Oh, crap, you know, I’ve had a couple of years where I had big surprises that I wasn’t happy about, or I had that side gig and I completely forgot about that little thing called self employment tax, things like that. And then, you know, more complicated things. So real estate investors, tons of our clients have real estate, and there’s lots of opportunities to take advantage of tax laws there. And I don’t mean take advantage in in a shifty kind of way. There’s just so many different opportunities available to real estate investors out there. Folks with student loans, that’s obviously huge in the pharmacy space, stock purchase programs in restricted stock units. Another thing that’s huge in the pharmacy space, especially with our friends in the industry. So you know, those are definitely the biggest and then of course side hustlers and side gigs and stuff. But you know, I would definitely say that those are probably the biggest areas where we see people kind of proactively looking for that assistance. And like I said, just because your situation is uncomplicated doesn’t mean that you can’t benefit from having that year round look at it or if you anticipate it’s going to get more difficult getting ahead of that now, as opposed to, again, having that revisionist history and saying, Ooh, let’s hopefully not have that happen again, you know, to any extent you can get ahead of those things, it’s always a good thing in my mind.

Tim Ulbrich  30:14

Great stuff. And for those that want to learn more and determine, hey, is this a good fit for me, now is the time, right? So here in a little bit, we’re going to kind of shut down the doors and say, we’ve got to focus on really serving those clients well, so if you’re interested in learning more to determine, you know, for this year and beyond, can wifey tax add value to your tax situation, you can simply just go to YFPtax.com. From there, you’ll see an option to learn more and book a free discovery call that call will be with Tim Baker. And from there we can determine what the path is. That makes sense. And you know, Sean, just to be clear, you know, there are folks, as you mentioned, that might have some more straightforward situations, but want to know that someone has a hand on the wheel and want to know that they have someone in their corner year round, and that’s okay. But we aren’t and we’re not shy about it, we’re not trying to compete with big box solutions that are, you know, running commercials these days. 24/7 for, you know, free returns, right, very different apples and oranges, in terms of the level of service, the year round nature of it. And what we believe is, is really high touch as well. So again, learn more yfptax.com, you can book a discovery call, and we’d love to have the opportunity to discuss further. Sean, thanks so much. We’ll see you back in the spring perhaps when you’ve come out of hibernation well, not hibernation, because you’ll be working hard. 

Sean Richards  31:30

It’s the opposite of hibernation. I’m not quite sure what the opposite exercise to that is. Yeah, yeah, hopefully I will emerge and not see my shadow or however that works. I will, I’ll see you in a couple months.

Tim Ulbrich  31:42

Awesome. And at that point, we’ll recap some of the things that you’ve probably been seeing throughout tax season and how people can be thinking again more proactively and strategically ahead. So thanks so much, and we’ll catch up later. 

Sean Richards  31:53

Sounds good. Thanks, Tim. 

Tim Ulbrich  31:56

As we conclude this week’s podcast and important reminder that the content on this show is provided to you for informational purposes only and is not intended to provide and should not be relied on for investment or any other advice. Information in the podcast and corresponding materials should not be construed as a solicitation or offer to buy or sell any investment or related financial products. We urge listeners to consult with a financial advisor with respect to any investment. Furthermore, the information contained in our archived newsletters, blog posts and podcasts is not updated and may not be accurate at the time you listen to it on podcasts, opinions and analyses expressed herein are solely those of Your Financial Pharmacist  unless otherwise noted, and constitute judgments as of the date published. Such information may contain forward looking statements which are not intended to be guarantees of future events. Actual results could differ materially from those anticipated in the forward looking statements. For more information, please visit yourfinancialpharmacist.com/disclaimer. Thank you again for your support of the Your Financial Pharmacists Podcast. Have a great rest of your week.

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