Podcast

YFP 265: 10 Lessons Learned: Employee to Entrepreneur

Posted on July 21, 2022November 2, 2022 by yfpadmin

10 Lessons Learned: Employee to Entrepreneur

On this episode, sponsored by Insuring Income, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, shares ten lessons he has learned on his journey from employee to entrepreneur.

Episode Summary

This week, Your Financial Pharmacist Co-Founder & CEO, Tim Ulbrich, PharmD, shares the top ten lessons he has learned over the past five years while taking Your Financial Pharmacist from a hobby to side hustle to a full-time business. Tim shares his most impactful takeaways on his journey from employee to entrepreneur and advice for those looking to take the same path. Tim shares how he found the motivation and inspiration to get started, the importance of the foundational why of the business that transcends motivation, the mindset required to move from employee to entrepreneur, and the incredible value of partnership. Tim shares ways to build on and nurture business partnerships and shares a helpful resource for maintaining successful business partnerships that help your business thrive. He shares why it is crucial to establish your core values early and how and why you must embrace the role of CEO. Considering growth and expansion, Tim outlines the need for implementing systems and processes. More specifically, he mentions having a system for evaluating the business. Tim shares a common theme he has discovered in the last five years interviewing pharmacist entrepreneurs, a passion for learning that drives entrepreneurial success. Lastly, Tim shares how identity and role differ and how embracing failure is necessary for business leadership.

Links Mentioned in Today’s Episode

Episode Transcript

[INTRO]

[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 fly solo to talk through 10 lessons learned through the first five years of starting your financial pharmacist and making the transition from hobby to side hustle to business.

Before we jump into the episode, I’m excited to announce that we’re doing our first ever virtual summit, employee to entrepreneur building blocks for starting and growing a business. The Employee to Entrepreneur Summit is designed for pharmacists who are planning or actively working on a side hustle or business idea. The summit will be hosted live via Zoom the evenings of Tuesday, August 30th, and Wednesday, August 31st. Topics and activities will include how to hone your mindset and uncap your potential as a business owner, how to grow a business from a position of financial strength, retirement savings and tax optimization strategies as a small business owner, how to develop a system for achieving business financial goals.

We’ll also be featuring several examples of pharmacists that have made the transition to entrepreneur and are monetizing their clinical expertise. Some awesome bonuses for those that sign up by August 23rd, including a one-on-one implementation meeting with myself or certified financial planner, Tim Baker, access to a live goal setting workshop that I’ll be leading to help focus on setting and achieving big personal and business goals. Finally, on-demand access to several bonus expert interviews, including how to sell with confidence marketing strategies and how to evaluate healthcare insurance options as you make that transition from employee to entrepreneur. You can learn more and register at yourfinancialpharmacist.com/businesssummit. Again, yourfinancialpharmacist.com/businesssummit.

Okay, let’s hear from today’s sponsor, Insuring Income, and then we’ll jump into the show. This week’s podcast episode is brought to you by Insuring Income. Insuring Income is your source for all things term life insurance and own occupation disability insurance. Insuring Income has a relationship with America’s top rated term life insurance and disability insurance companies, so pharmacists like you can easily find the best solutions for your personal situation. To better serve you, Insuring Income reviews all applicable carriers in the marketplace for your desired coverage, supports clients in all 50 states, and makes sure all of your questions get answered. To get quotes and apply for term life or disability insurance, see sample contracts from disability carriers or learn more about these topics. Visit insuringincome.com/yourfinancialpharmacist. Again, that’s insuringincome.com/yourfinancialpharmacist.

On November 6th, 2015, I wrote the first blog post under the name Your Financial Pharmacist. That post was a chronicle of the journey that my wife, Jess, and I took into and out of $200,000 of debt. Furthermore, it was an acknowledgment that there was a need to develop a community of pharmacists that could encourage and inspire one another on their path towards achieving financial freedom. Fast forward to 2022, the YFP community is now 13,000-plus strong, but it started with a list of less than 100 individuals that I twisted their arms to say yes to receiving my first blog post. Those blog posts led to some speaking engagements and more pharmacists coming forward to share their own stories.

After that, I was invited to do some speaking engagements, which would eventually lead to relationship with a National Pharmacy Association that helped increase the awareness of the mission of the work that we’re doing at YFP. Shortly thereafter, I would co-author the book Seven Figure Pharmacist with Tim church. Not too long after that, I would connect with my business partner of now five-plus years, Tim Baker. Funny enough, we recently discovered that Tim began his work to start a fee-only financial planning firm for pharmacists within the same week that I wrote that first blog post in November of 2015. Tim Baker, after we met, we would decide to launch the YFP Podcast in July of 2017, which was the beginning of a friendship and a partnership that was essential to grow the business to where we are today.

When I reflect on the past five years and the ups and downs of going from hobby to side hustle of business to making that transition from employee to entrepreneur, here are the top 10 lessons that I’ve learned along this journey. Number one, start. In July of 2015, I was traveling to the AACP Annual Meeting in National Harbor, Maryland. The book I selected for the trip to read on the plane was Start by Jon Acuff. It’s a special moment when a book collides with your life path, and this was one of those moments. You see, at the time, I had been thinking about the idea of YFP but was struggling with what to do with the idea. I was reflecting on my first business venture, a company called Farm Forward, and the lessons that I learned from taking those initial baby steps into entrepreneurship. It was the words Jon Acuff penned in Start that would push me over the edge to formalize the initial idea of YFP to get the name established, to set up the legal entity to build the first prototype of the website. It was rough, and to ask 100 friends and colleagues to join the start of my email list and ultimately published that first blog post.

I needed the words of encouragement from Jon Acuff to just start. I knew I had to heed this advice because the idea of YFP would not leave me alone. I couldn’t stop thinking about building a platform for pharmacists to learn more about personal finance, to bring a community together. I knew it was needed, and I knew it could have an impact. But fear still crept in, with questions like, “What if it doesn’t work out? What if nobody likes the blog post? What if this is a good idea only in my head, and who am I to write on this topic, not being a financial planner myself?”

Speaking with many entrepreneurs over the last five years on the YFP Podcast, this theme of just start keeps coming up again and again. Those who have built something that is solving a problem and serving others all had to work through their own fears, anxiety, and unknown to take the first step. You see, many great ideas never see the light of day. Too often, individuals get paralyzed in the analytical phase where passion gets muted by excuses, questions, and doubts. Sometimes, you just have to jump in the deep end and figure it out. The idea of just start has stayed with me through the entire journey so far of YFP. It doesn’t just apply to getting a business off the ground.

As I reflect back over the past five years, we’ve evolved from three companies to one company. We’ve changed our logos and branding, we’ve redesigned our website multiple times, we’ve reformatted the podcast, we’ve identified better tools and solutions inside of the business, and we’ve taken the lead to grow our team. None of these were smooth-sailing, and the only way we were able to identify and grow is because we ended up in the first place of just starting. There had to be a beginning. So that’s number one is start.

Number two is a strong why, a strong why. In his book, Start with Why, Simon Sinek talks and says that every one of us has a why, a deep-seated purpose, cause or belief that is the source of our passion and inspiration. Making the shift from employee to entrepreneur will inevitably include bumps along the way. Challenging days and seasons are to be expected, but getting stuck and being a prisoner to your motivation is not an option. Motivation alone may not provide enough fuel during the challenging seasons. Therefore, it’s critical that the why of our business and its offerings transcend the level of motivation that we have on any given day. We need a strong enough why that drives us to commit the time and effort that the business needs.

One of my favorite podcasts over the past several years is How I Built This with Guy Raz. On this show, Guy takes the listener behind the scenes with a founder to hear about the movements that they have built. Many of these stories have trials and tribulations, and it was in those moments, in those trials and tribulations that the passion behind the idea and the problem the product or service was solving would help propel the founder through that difficult time.

At YFP, our mission has helped pharmacists achieve financial freedom. Why? Because having a financially well pharmacist workforce is in the best interest of the profession and, ultimately, the patients that we serve. Furthermore, the profession of pharmacy needs big ideas. We need disruptive ideas, ideas that are going to improve the health and wellbeing of our nation. But the problem is big ideas, disruptive ideas, these rarely come from someone that is living in a state of financial stress.

If someone’s overwhelmed with student loan debt, if someone’s confused about how to best save and invest for the future, if someone’s frustrated by the fact that they’re making a good income but not progressing financially, or if they’re anxious that they feel like they’re financially behind, any one of these is a killer of a dream, a killer of a big idea. So we’re on a mission to change this narrative and to empower pharmacists, to ensure that future generations of pharmacists are financially well, and to embed financial literacy into the core and fabric of our profession. I remind myself of this mission every day, and this propels me through the highs and through the lows. Our mission is greater than any one challenging season of the business.

Number three is mindset, mindset. Since leaving my work in academia most recently in a position at Ohio State to work full time on the business, I did not anticipate the growth that would happen and that was needed related to my mindset. Thanks in large part to an incredible coach and mentor, Chris Caldwell, I would begin a journey that dug into some serious self-reflection that was stimulated by some really deep questions, questions like why is achievement so important to me and my identity? Why have I struggled to just be present, without work or accomplishment? How could my life look if I embrace the purpose of just being the best version of myself? What do I actually want? What are the stories that are telling myself? In what ways am I showing up as an inauthentic version of myself? What artificial ceilings have I created in my personal and professional life, and why have I created these ceilings?

Over the past year, I’ve come to appreciate that I’m just beginning a lifelong journey of digging deeper. This journey of leaning into some hard questions with the goal of living to my fullest potential and being the best authentic version of myself that I can be has been one of the greatest gifts of entrepreneurship that I did not see coming.

Number four is the value of partnership, the value of partnership. In the summer of 2015 after meeting on Twitter, yes, that is a real thing, I had the chance to connect with Tim Baker in person. We met at a Bob Evans of all places off I-71, about halfway between Cleveland and Columbus. As Tim Baker likes to tell the story, he found me on Twitter and is wondering, who was this other Tim that was talking about personal finance in pharmacy? At the time, Tim Baker was living in Baltimore and was visiting his sister in Columbus, which provided the opportunity for us to connect in person.

The timing was perfect because at that time, I was struggling to connect the education piece of what I was doing around personal finance, with a sound financial planning offering. I knew that was going to be an important piece of the puzzle of transition to work into a viable business, and I knew that service was needed in our profession. I was in the process of talking with several planners in Northeast Ohio, trying to understand the lay of the land and how the industry works. You see, at this time, I was not aware of terms just fee-only and fiduciary, and I quickly realized the complexities of the industry after having several conversations with different planning firms. I was frustrated by the lack of transparency in pricing and how the industry historically has not served folks in the early stages of their career, since how much one has an assets was usually a prerequisite for a planning relationship.

When I met Tim Baker that day in Bob Evans, he shared his journey starting in the United States Military Academy at West Point that would lead him to a career in logistics for a major retailer and then a construction company in Ohio and California. After realizing that he wanted something different, he made a pivot to a career in the financial services industry. After working at a small independent financial planning firm, he decided to take the leap to start his own business, offering fee-only financial planning services focused on the pharmacy profession. At the time, the business was Script Financial. Through a friend at West Point, who was married to a pharmacist, he identified that there was a gap in the industry in serving pharmacy professionals.

Now, I was hooked when I learned about the meaning of fee-only and the fiduciary standard, and that combined with the alignment on values and growing a small business led Tim and I to start collaborating on the Your Financial Pharmacist Podcast. This collaboration furthered our friendship and respect for one another, which led us a step further towards eventually becoming business partners.

Now, growing up in a family business, I observed firsthand the challenges that can come from partnerships, especially when it’s family members that were involved as partners. From that experience growing up and hearing many other individuals’ words of caution about partnerships, it shouldn’t have given me a pause, but it never did. I knew if there was alignment on vision and respect for one another, we could thrive and work through challenges. That has been exactly the case, and I’m so grateful for the friendship and partnership that Tim and I have.

One resource that’s been key to our partnership is the Book Partnership Charter by David Gage. This book takes two or more individuals going into business together through a series of activities and challenging discussions that lays the foundation then for the operating agreement. Tim and I have made it a priority to annually review and update our charter and check in on the health of the partnership.

Number five is establish your core values of the business early. Establish your core values early. When starting a business, it’s easy to be off and running in the day-to-day such that activities like strategic planning or vision setting or setting core values might not be the priority that they deserve to be. I’m so grateful that early on, we decided to set a set of core values that several years later serve as the guiding path for the culture of our company, for the benefits that we offer our team, for how we hire, and for how we evaluate our team members. One resource here that was really helpful was the book Delivering Happiness by the late Tony Hsieh, the Founder of Zappos.

Number six is embracing the CEO role, embracing the CEO role. I can easily fall victim to squirrel syndrome. As the founder and leader of a business, it’s a fine line between identifying new opportunities and getting sidetracked and losing full focus on the core mission. A couple of years ago, I had the pleasure of interviewing Samm Anderegg, CEO of DocStation, and he would provide some advice to me that has stayed with me and helped me to refocus when I’m feeling overwhelmed or sidetracked. The advice he would share that is at the end of the day, the CEO has three main responsibilities, and that is vision, people, and resources.

For vision, it’s the CEO’s responsibility to ensure there is a compelling vision and that the vision is core to the business and well-understood and accepted by the team. The products, the services should be aligned to the vision, and new opportunities should be evaluated for alignment to that vision or perhaps lack thereof of alignment. When it comes to people, as a business grows beyond its founders, the success of achieving its mission is dependent upon the people that are hired. I’ve come to appreciate how important it is to build the right team and to ensure those team members have alignment with core values. Beyond the minimal technical expertise for one to be able to do their job, it’s the other things that matter most. For us, that includes alignment with our core values, including be kind, value team, optimize, you serve the community, and embrace ownership.

When it comes to the third component, that third main responsibility of the CEO, in terms of money and resources, the CEO has to have oversight to ensure the resources are sufficient to keep the ship moving forward. Cash money in the bank to keep the lights on, pay the payroll, and keep that vision going in the right direction. Now, depending on the nature of the business, one may have cash flow, decide to cash flow the business, or they decide that they’re comfortable taking out some type of debt or additional capital from investors to be able to fund the business.

Number seven is implementing systems and processes, implementing systems and processes. When starting a business, it’s all hands on deck and all roles. It’s natural to wear every hat there is, and the energy behind the idea typically sustains us through this phase. Whether it’s content creation, marketing, sales, finances, HR, IT, we do our best to wear every single hat. But at a certain point, if the goal is to expand the mission and reach of the business beyond yourself, naturally, two things need to happen. One, you have to be comfortable delegating that work to someone other than yourself. Two, you have to download that information in your head in such a way that a process or service can be replicated and built upon by someone else.

Let me give you great examples. I think my business partner, Tim Baker, has a really good mind in this area of the importance of systems and operations and being able to document those systems and operations. In 2020, we realized that in order for us to achieve our mission of helping as many pharmacists achieve financial freedom as possible and being able to transform the financial wellness of the profession of pharmacy, we were quickly going to run into a barrier if Tim Baker remained a full-time financial planner. That was eventually going to be a ceiling for us.

One problem here is that was going to quickly lead to burnout, as he was trying to be an owner and a full-time planner. Two, him stepping out of that seat was going to force us to develop the systems and processes to replicate the financial planning model and approach in a way that could be scaled. This was really our first aha moment of needing to fire ourselves from various roles, and that has been our mantra ever since. What should we be doing next to make the business less dependent on us so that we can further expand the mission of the offering?

Not only does this mindset allow the business to grow, but it also makes the business more valuable because it’s not just dependent upon you. It also increased the likelihood the business could go on when you decide to retire or take an extended break, and it reduces the risk that you will become a prisoner to your own business. Two books that have really helped shape my mindset on the value of systems and processes inside of a business are The E-Myth Revisited by Michael Gerber and Traction by Gino Wickman.

Number eight is developing a system for evaluating the business. Now, building upon the previous concept, which was implementing systems and processes, once you begin to systematize and process the processes and operations and bring others into the business, we need to make sure that we have a system to regularly evaluate the success of the business. Now, this will naturally evolve over time, but this would include things like key performance indicators, KPIs, and a method to track and review those.

In the book Traction by Gino Wickman, he recommends developing a scorecard that has 5 to 15 of the most important metrics that can help you quickly identify the health and direction of the business. Now, naturally, the question is, well, what are those metrics, right? He proposes a great question in the book to get you thinking about what those 5 to 15 metrics might be, and that question and scenario who presents is imagine you’re on a desert island somewhere. All you have is a piece of paper with a handful of numbers on it. These numbers must allow you to have an absolute pulse on your business. What are all of the numbers that must be on that piece of paper, right? That activity is designed to help you come up with what those 5 to 15 metrics might be for that scorecard.

In addition to Traction by Gino Wickman, I would also recommend here the book Profit First by Mike Michalowicz. We’ll link to all these books in the show notes. The Profit First methodology has really been instrumental for how we handle our business finances and really helps expose whether or not you are accounting for all of your expenses. It ensures that as a business owner, you’re taking some amount of profit home each quarter, even if that’s just 1%, that you’re putting aside money for your taxes, and that you’re paying yourself a sufficient wage for your time and efforts. For many, this model helps expose the true financial health of a business and often can shine a light on a business that is not as profitable as it thinks it is or that is not charging enough for its services.

Number nine, become a voracious learner. Become a voracious learner. In conducting over 200 interviews for the YFP Podcast, I’ve noticed a common thread among the entrepreneurs that I’ve talked with. Those interviewed often demonstrate humility in knowing that no matter what credentials they carry or success that they’ve had, there is always room to learn and grow. They are hungry to learn. This is evident in the books they’re reading, the professional development courses they’re taking, and the time and money they’re investing in services to grow personally and professionally.

In the book, The End of Jobs, author Taylor Pearson argues that we are rapidly moving into a time period when one’s credentials and degrees have limited value, thus requiring continuous learning and growth. The good news is that we live in a time in history when learning is more accessible than ever, and I’ve come to appreciate that one of the greatest things I can do for my company, our team, and the community we serve, is to continuously learn and grow.

This has led to a constant growing list of podcasts and audiobooks, and here are some of my favorites from the past year. The Four Agreements by Don Miguel Ruiz, The Big Leap by Gay Hendricks, Procrastinate on Purpose by Rory Vaden, The Entrepreneur Roller Coaster by Darren Hardy, The War of Art by Steven Pressfield, The Surrender Experiment by Michael Singer, A New Earth by Eckhart Tolle, The Secret by Rhonda Byrne, and Changes That Heal by Henry Cloud. Again, we’ll link to all these books mentioned in the show notes.

Number 10 and perhaps most important is identity versus role, identity versus role. I alluded to this a little bit in number three when talking about mindset, but it’s worth coming back to this one a little bit further and another shout out to Chris Caldwell for bringing this concept to my attention. Based on the IR theory, identity and role theory, it’s common for us to believe that our identity, our self-worth can be derived from how well we perform in various roles. That could be as a spouse, as a parent, as a pharmacist, as a business owner. If we can’t separate our identity and our roles, our self-worth can ebb and flow with how well we have or have not performed or a perception of that in various roles.

This is natural, considering that we are taught from a young age, many of us, to tie success to the affirmation we receive from others. But here’s the problem. We are naturally going to experience failure in our personal and professional lives. Experiencing failure and being a failure are two very different things. Experiencing failure and being a failure are two very different things. But if we’re not careful, through experiencing failure, we can convince ourselves that we are a failure, and this can lead to a shake in confidence. This can lead to playing it safe and avoiding future risk.

But in my mind, that’s not the biggest threat. The biggest threat and tragedy is when we let failure escalate to a feeling of less than and a feeling of having a diminished self-worth. Without the right perspective and accountability, these feelings can quickly creep into every corner of our lives, and we must not let this happen because experiencing failure, again, is not being a failure. That does not equal being a failure. As many leaders and entrepreneurs know, experiencing failure is to be expected and can be welcomed with the right mindset. Albeit painful at the moment, through failure, there can be great growth. If we can begin to accept that there is growth in failure, we can entertain the idea that failure is essential.

I’ve struggled with this mindset shift, which is also true, I suspect, for many of my peers in the profession because it’s drilled into us from our education and training that mistakes should be avoided to prevent medication errors as close to 100% accuracy as possible is the goal. This makes sense for patient care, but this mindset of getting it right all the time shouldn’t carry into all aspects of our work and our lives for that matter. That mindset of 100% accuracy all the time is exhausting, and it prevents real growth because it doesn’t embrace failure. But if we can anticipate and welcome failure, our mindset shifts from disappointment to learning and minimizes the likelihood that we’d let the experience of failure creep into our identity and our self-worth.

So those are the 10 takeaways, the 10 lessons that I’ve had in this journey of starting YFP back in 2015 and making the transition full time and reflecting back on the past five years, from hobby to side hustle, to business, from employee to entrepreneur. That’s why I’m so excited. We’ll be digging into these points and so much more during our upcoming virtual summit, employee to entrepreneur building blocks of starting and growing a business.

The Employee to Entrepreneur Summit is designed for pharmacists who are planning or actively working on a side hustle or business idea. The summit will be live via Zoom the evenings up Tuesday, August 30th, and Wednesday, August 31st. Topics and activities will include how to hone your mindset and uncap your potential as a business owner, how to grow a business from a position of financial strength, retirement savings and tax optimization considerations as a small business owner, how to develop a system for achieving business financial goals. Also, we’ll be featuring several examples of pharmacists that are monetizing their clinical expertise and have made that transition from employee to entrepreneur.

Bonus content for those that sign up by August 23rd, including a one-on-one implementation meeting with myself or certified financial planner, Tim Baker, access to a goal setting workshop, I’ll be leading to help focus on setting and achieving big personal and business goals, as well as access to several bonus expert interviews, including how to sell with confidence marketing strategies, evaluating health care insurance options, and more. You can learn more about the summit and register at yourfinancialpharmacist.com/businesssummit. Again, that’s yourfinancialpharmacist.com/businesssummit. As always, thanks for listening and have a great rest of your day.

This week’s podcast episode is brought to you by Insuring Income. Insuring Income is your source for all things term life insurance and own occupation disability insurance. Insuring Income has a relationship with America’s top rated term life insurance and disability insurance companies, so pharmacists like you can easily find the best solutions for your personal situation. To better serve you, Insuring Income reviews all applicable carriers in the marketplace for your desired coverage, supports clients in all 50 states, and makes sure all of your questions get answered. To get quotes and apply for term life or disability insurance, see sample contracts from disability carriers or learn more about these topics, visit insuringincome.com/yourfinancialpharmacist. Again, that’s insuringincome.com/yourfinancialpharmacist.

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.

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YFP 264: How a 2022 PharmD Grad Left School Debt Free

Posted on July 14, 2022November 2, 2022 by yfpadmin

How a 2022 PharmD Grad Left School Debt Free

Dr. Alexis Miller talks about graduating from pharmacy school debt-free because of her service to our country, by joining the Army in 2017. She shares why she decided to join the Army while in pharmacy school, the ins and outs of the GI Bill and tuition assistance, and how she plans to apply her pharmacy knowledge to her role in the Army.

About Today’s Guest

Alexis Miller, PharmD recently received her Doctor of Pharmacy degree from Ohio Northern University and is a postgraduate resident at Steward Carney Hospital in Dorchester, MA. Alexis is originally from Wayne, OH, and currently resides in Boston, MA with her fiance, Curtis, and their golden retriever, Hudson.

Alexis enlisted in the Ohio Army National Guard in 2017 for the tuition benefits. Because of the Army, she obtained her Doctor of Pharmacy completely debt-free. In the Army, Alexis is a motor transport operator and retention NCO (non-commissioned officer). Alexis holds the rank of Staff Sergeant.

Alexis is looking forward to connecting with the YFP community and helping young pharmacists and pharmacy students utilize another option to minimize student debt and maximize financial freedom.

Episode Summary

This week, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, is joined by Dr. Alexis Miller, a 2022 graduate of Ohio Northern University, who discusses her recent graduation from pharmacy school debt-free because of her service to our country by joining the Army in 2017. In this episode, Alexis explains her incredible story and motivation for joining the Army when selling cows didn’t cover her education cost. Alexis shares her feelings about graduating debt-free, her plans to complete her six-year commitment to the Army, and her unique pathway in transitioning from a student to a new practitioner as a doctor/truck driver. Alexis dives into the ins and outs of the GI Bill and tuition assistance and how she was able to piece together various forms of funding and scholarships to get her annual education payments to roughly $1,000 annually. She provides insight into working with recruiters and why choosing a recruiter who cares about you and your goals is incredibly important. As a ‘type A’ personality, Alexis speaks on her desire to seek perfection while juggling her Army commitment as a pharmacy student and how her mindset shift from being the best to doing her best made all of the difference in her educational experience.

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 a chance to welcome a 2022 graduate of Ohio Northern University, Dr. Alexis Miller, to talk about her journey graduating from pharmacy school debt-free not just from scholarships or from selling her cows. Yes, you heard me right. From selling her cows. But also, because of her service to our country by joining the Army in 2017.

Some of my favorite moments from the show include hearing Alexis talk about why she decided to make the decision to join the army while in pharmacy school. The ins and outs of the GI Bill and Tuition Assistance, and what she learned about herself during the journey of completing pharmacy school and joining the army, and why she realized that bare minimum is not in her DNA.

Now, 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 240 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 working one-on-one with a certified financial planner may help you achieve your financial goals, you can book a free discovery call at yftplanning.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 into my interview with Dr. Alexis Miller.

[INTERVIEW]

[00:01:35] TU: Alexis, welcome to the show.

[00:01:36] AM: Hello. It’s so exciting to be here today.

[00:01:39] TU: Well, in the intro I put together for the show, I referenced you were a 2022 grad of Ohio Northern University. Go! Polar bears. And now, officially Dr. Alexis Miller. How does it feel to finally be done with pharmacy school?

[00:01:53] AM: I think the moment that you graduate and you realize you’re done, it’s absolutely surreal, because you’ve spent the last, really, 20 some years of your life being a student. And that’s all you’ve been used to. At that point you’re like, “Wow! Like, I am done.” And quite frankly, I don’t necessarily know how to pursue the next step like. I don’t know what awaits me. But I guess I’m ready for the world.

[00:02:18] TU: I love that. And I’m excited to dig into your story and share how you were able to graduate debt-free from Ohio Northern University this year. And we often talk on this show about debt repayment strategies. Or we’ve shared debt-free journeys where folks have really worked hard or through forgiveness programs to get to the point of having no more student loan debt. This is different because you avoided it all together. And we’re going to talk about how are you able to do that through the journey that you’ve taken.

You posted this on LinkedIn a couple months ago. That post went viral. I think maybe surprised you a little bit as well. Had almost 30,000 reactions. And excited to share your story with the YFP community. But before we get into that story, tell me a little bit more about your interest in pharmacy and what ultimately drew you into the profession.

[00:03:05] AM: I always like to say it wasn’t necessarily why I joined pharmacy. Just because with Ohio Northern, it is a direct admit program. You’re joining as you are still a high school senior. I was 17-years-old and really didn’t have any idea of what I was going to do with my life or really what I necessarily wanted. But I always say it’s really what made you stay in pharmacy, especially in a direct admit program like that. You have so many opportunities as you’re going through to change your major. Get out. Take a whole completely new path.

And I always like to say, it was a lot of the people that I encountered between doing experiential hours or my internships and even the people that I just went to school with. I realized like those were the kind of people that I wanted to work with for the rest of my life. And those were the kind of people that I wanted to impact. And that was the thing that I couldn’t give up. Even when pharmacy school got to be at the point where I didn’t know if it was for me anymore, it was always the people that were really telling me I could do this every day.

[00:04:05] TU: I love that. One of the things I like to talk about is that your why and your purpose has to be stronger than your motivation. Because your motivation can wax or wane, right? You live that firsthand in pharmacy school. There are some tough seasons. But if you’ve got a strong purpose and why of what you’re doing and why you’re doing that, I think that can really carry through. That’s really cool to hear that.

Alexis, I’m going to share your post. What you wrote on LinkedIn that really garnered so much attention. And then I’m going to ask you kind of how you got to the decision that you did. You said, “In September 2017, I decided the only way for me to complete my pharmacy degree without being in debt was to join the army. I joked that I was “young and dumb” signing my name on the dotted line, committing myself as a pharmacy student to basic training and six years as a truck driver. I was enticed by the idea of the GI Bill and Tuition Assistance. And my original plan was doing the bare minimum to get my degree paid for. Getting in, getting paid, and getting out. Today, I pinned staff sergeant at only four and a half years in the Army.”

First of all, congratulations. Really appreciate your commitment and your service. My question is I think this thought maybe has crossed other folks’ mind especially in the health professions in a pharmacy. But few I think actually make the decision to move forward. How did you come about this opportunity? And why did you ultimately make the decision to go forward?

[00:05:27] AM: When I started my freshman year throughout high school and summers and everything else, I came from a farm. I was selling livestock. I was selling animals. And I was selling crops. And I had this dream that, with my cows, I was going to pay for my school. But it came down to freshman year, after one year of tuition, I had about a thousand dollars left and five more years of school. And I realized that my goal of graduating debt-free, if I were just trying to do it on cows, really wasn’t going to work anymore.

And I was already paying for school with cows. It was already a very abnormal decision. I just kind of looked around, chopped around of like how can I get this paid for now? And maybe in the generation of instant gratification, the first thing that I found was the Army. And I ended up in a recruiter’s office and was talking about the opportunities, the options, and essentially how much I could make out of it. And, of course, the idea is very scary. I kind of got myself in a position where it’s like I have to commit now or I’m going to change my mind. I just immediately, “Let’s commit to the bit. Let’s go.”

[00:06:32] TU: Alexis, would this have been – I’m trying to think 2017. Would this have been your P2 year? You’re still like in pre-pharmacy?

[00:06:39] AM: Yes.

[00:06:39] TU: Okay. I think back to my time in academia. And if a student would have come to me – I did a lot of career counseling with students. If a student would have come to me and said, “Hey, Tim, I want to join the Army.” I’d have been like, “Uh, I don’t know how to help you. But let me find out.” And I don’t think this is an area that we talk enough about from a career development opportunity standpoint. How did you navigate finding that information?

Because I think for others that are listening that are thinking, “Hey, I didn’t think about this pathway. Maybe it’s something I consider.” Where could one go? Tell us more about how you’re able to navigate this opportunity.

[00:07:12] AM: A lot of it myself where I started was with Google of like what recruiters are in my area. Who can I talk to? In terms of my family, I don’t have any military background in my family. And especially at school – And Ohio [inaudible 00:07:25] private school as well. I knew I wasn’t going to get as much assistance there.

And especially when recruiters came in to talk to students in high school, I ignored them. I didn’t think that was an opportunity, a path that I was ever going to take. I had to go back to the route that I ignored, and I went back to finding recruiters. And I found one nearby. And I ended up switching a couple times trying to figure out who I really wanted to be with. That’s a big thing, too, for people who, pharmacy student, are looking at that path. Sometimes recruiters are going to sell you on anything. They’re looking to increase their numbers. They’re looking for that next bullet point. And you are part of that bullet point, whereas others really do care. And that is very important that you just don’t jump on the first hook. The first bait that comes to you. It’s important to look for somebody who actually is there because they want to be there.

And so, that was me just kind of looking around. And I finally found one person who he was adamant, like, “You’re here for school money and you want this deal. And that’s it.” That was really awesome when I found – My recruiter at the time, his name was Sergeant [inaudible 00:08:31]. He’s now retired and rides his Harley every day. He’s living a great life.

But when I talked to him, he would frequently take his time, come down to Ohio Northern, which was an hour drive from where he was. And that’s my biggest tip, is find a recruiter. But make sure it’s one who really cares about you. Or as well as somebody who’s already done it. They can tell you the ins and outs, the good, the bad, the ugly. And those two are your best avenues to kind of get that information. For me, I had Google and Sergeant [inaudible 00:09:02]. That was the only way I was able to get my information.

[00:09:07] TU: That’s great, Alexis. That was one of my hopes of bringing you on the show, was to share and celebrate your story. But also, I suspect for many that are listening, perhaps some that are even currently in school, maybe not thinking of this as an opportunity. And I didn’t know for example that it really matters what recruiter you talked to. I kind of had this impression, all information is equal and consistent. Just being able to have someone like yourself to reach out to, to ask questions, to point in the right direction I think can be really helpful.

You’ve already achieved, Alexis, two firsts on the YFP podcast. One, being that we’ve never had anybody that has sold cows to go to pharmacy school. That’s a first. And only folks that maybe grew up in our area will understand that. And second, being you’re the first person we’ve had on the show that has combined – That at least we featured combine this pathway in the army with being able to graduate from debt-free. So, really, really excited for you.

Were there other branches of the military that you were considering? I know, often, when I talk about being able to consider military pharmacist positions and how that relates to student loan debt, I kind of talk broadly about positions. Here, we’re talking specifically about a role in the army. Talk to us about was this an obvious choice? Or were there other branches in the military you were considering?

[00:10:22] AM: The two options that offered the National Guard near me to be able to pay for school in the manor were the Air Force and the Army. And I’m going to be honest, I never once looked at the Air Force. Hindsight, when we are in the field and we haven’t showered, and it’s hot, and we’re miserable. Sometimes I think maybe I should have looked at the Air Force. But I definitely will say, when I was 17 and looking for that path, maybe my ego got the best of me and I wanted to be in the Army instead of the Air Force. Whereas, in our world, we called the Air Force the chair force. And I look at that now and I’m like, “That’s so stupid.” Like, why did we think that way? And why did I think – But I wouldn’t take anything back. But that was – I looked at the Army simply because of its reputation and the ego behind it. I hate saying that. But it really is the reason why.

[00:11:15] TU: Tell us more about the specifics of joining the army and how that allowed you to graduate debt-free. I’m thinking here about like the requirements of service, the time commitment. How the stipends work or the tuition reimbursement? Tell us more about the ins and outs of how that service in the Army ultimately allowed you to graduate from Ohio Northern. Great school. I’m a little bit biased. But a great school. And to do that debt-free.

[00:11:40] AM: The way it begins when you first join, in order to get the four years for school credit, it’s good at any – At least in Ohio, it’s good at any public school in the state. And then it will do the max public school amount going to any private school. It does fluctuate year by year of what you can get. But in order to get that four years theoretically for your undergrad, you have to commit six years. And that six years is the moment you sign the dotted line until six years later.

Even when you’re not completely doing a whole lot and you’re still waiting to go to basic training, that still counts towards your time in. I had about, I want to say, seven months like that, that still counted towards my six years. But I really wasn’t doing what I’m doing now.

With that, with the six years, you’re able to get 13,000 about per year through your scholarship. Mine fluctuated sometimes a little over, a little under. But on average, I was getting 13,000 for four years sent automatically to my school. If you were at a public school, per se, it would be entirely covered. They cover the max there.

And then, because I was a full-time student, I automatically was able to get the GI Bill. My GI bill was about 400 per month. And then following the GI Bill, you had your drill pay. Drill pay is like when you go in every single month and you do your work. It could be anywhere from two days, to four days, to – I want to say my longest was a week. While you’re doing it, it’s a little tough. But the paychecks are really nice when you get it.

But anyway, drill pay where I was at, average ranking, it depends where you’re at. Your rank and how long you’ve been there. But you can expect to make anywhere between 300 to 600, potentially more, on your drill pay per month. And then once a year you do two weeks typically out of the summer. And that’s your annual training. And on annual training, you can expect to get about 1500. In total, in the one year that you’re there between your scholarship, your GI Bill – Your GI Bill you just get for being a full-time student. You do not have to do anything for the GI Bill except call the VA and say, “I’m a full-time student. And this is my school.”

And then drill pay and annual training pay combined, you can make about 23,000 per year just from being on that. And then as well, wherever you’re at, any school regardless, you get to tack any other scholarships you receive on top of that.

[00:14:07] TU: Oh, wow!

[00:14:08] AM: That’s why, at Ohio Northern, I was able to do really well, because I was able to tack on – Especially during undergrad, my 19,000 a year that I got from ONU to that 23 to where suddenly I was paying minimal. Less than a thousand dollars per year in my first four years of undergrad to go to school.

[00:14:26] TU: Wow! And so, therefore, the cows could handle the rest of that, right? We could get down to the zero balance.

[00:14:32] AM: Yes. The cows, the internships, the on-campus job, that was easy to manage.

[00:14:38] TU: How were you – When I hear you say on-campus jobs, you obviously had requirements here through the Army. When I was in pharmacy school, granted you’re obviously more mature than I was at the time, but I felt like it was all in on time and effort just to be able to get through pharmacy school and to do that well. Here, you’ve got the commitment piece in the Army. You mentioned other on-campus work requirements. I’m guessing you were involved in other things as well. Talk to us about how the balance of this works. And were you ultimately able to feel like you were going through pharmacy school and completing that well while also filling your other service obligations?

[00:15:12] AM: There were different times, especially I want to say my third year was when I really started to experience a few of the challenges of the service obligation combined with pharmacy school. Everything else seemed, especially on campus, with sports, and organizations, and work, it all just seemed to bend to the whim of pharmacy school.

Pharmacy school always trumped that. It never seemed to get in the way. But with the military, it’s kind of like taxes. You don’t get to say no, even if it’s a bit of a challenge. There were days starting in my third year when school started getting more intense. And I started picking up more rank in the military that I could be going out of school for a week at a time.

There was a point when I was gone for almost 10 days and then you come back and you’re like, “Hi! What happened? I’ve been gone.” And your inbox is full. People are emailing you, “Where are you?” And you’re like, “I didn’t even have a phone for the last 10 days.” Like, I don’t know what’s going on. Those were the really challenging times.

And just kind of missing things of like rearranging things with professors of like, “Hey, the exam is Friday. I’m leaving Tuesday. And I won’t be back until next Tuesday.” It was a lot of taking – My third year, I took everything early. I think every quiz, every exam, it was like, “Oh, I’m here.” Five o’clock at night to take my quiz three days before everybody else.

It was kind of at that point when I realized I didn’t necessarily have to be at the same point as everybody else. And I know, like, especially with type A personalities, as pharmacists and pharmacy students, you really get caught in that pressure of that person A did this. And person A was able to do all these other things. And person B got an A in this class and an A. And I wasn’t going to be a 4.0 student. And that was the hardest pill for me to swallow, was that I couldn’t be all these other things because I had this one nagging thing that a lot of other people didn’t necessarily have. That was the hardest part, is to kind of realize you can’t compare. And I really think we get caught in that comparison game.

And so, that was when I realized, like, “I’m not going to be a 4.0 student anymore. I have to make it through, do my best. And as long as I put in all the effort that I could put in, use all the energy that I had.” I couldn’t be ashamed of myself at the end of the day. As long as the effort I know I couldn’t have put in any more, I couldn’t be upset with that.

[00:17:37] TU: Yeah. And, Alexis, arguably more important than your grades is what you learned about yourself through this journey. And I think I’ve come to appreciate that more and more since being out of pharmacy school where in that moment, as you mentioned, especially I think in a very competitive program, it’s very easy to draw that pure comparison. It’s very easy to get caught up in that. But big picture, I’m hearing you talk and talk about your journey. And I can tell there’s a lot of self-discovery through that journey. And one thing I wanted to hit on specifically is in the post you put on LinkedIn, you had mentioned that you were enticed by the idea of the GI Bill and Tuition Assistance. With your original plan is that you’re going to do the bare minimum. Get your degree paid for. Get in. Get paid. Get out. But then you would later say good things come to those who put in the work. Bare minimum is not the kind of person I am or will be. That’s a significant jump from where you started mindset-wise to where you kind of ended. Tell me more about that and what you learned about yourself during the journey.

[00:18:33] AM: I guess when I started, I first looked at strictly money. And that’s all it was about. It was only about money. I felt like some people go through the military and they’re like, “Oh, I love my country.” I felt like I didn’t have a patriotic bone in my body. I just wanted that money to get my pharm beat.

There was no like family history. There was no massive drive. Like, no bald eagles cried when I woke up. It was money. Honestly, whether you put in the max effort or the minimum effort, you’re still going to get the same amount of money in the end. And that’s where I was looking at it and was like, “Okay, I don’t have to do anything spectacular.” I just have to get in, do the bare minimum, get out. Show up one week in a month, I don’t have to do anything extra, and also get paid.

But then the more that I was there – I hate saying it. But it’s always the toxic leaders that you seem to learn a lot from. The best leaders and the toxic leaders. And I saw in that environment there were some that were absolutely phenomenal people. And they busted their tail every single weekend we were there. And even in the times outside, like, they just really cared about people. They really cared about their small part-time job. But then there were other people who I could tell had only received their leadership roles and promotions because they’d been there long enough and they were running out of people to promote. And that, to me, I was like, “Wow! Like, there are people like you here taking care of soldiers, young individuals, and you’re trying to mold their minds. And this is how you’re acting.” And I just felt like that wasn’t – It wasn’t a strong environment to be in. But I saw that there were enough people that really did care. I was like, “I want to be like those people.”

And I always like to tell myself that I’m going to just show up. And sure, I’ll do the minimum. That’ll be fine. I never end up doing that. I should have known I was not going to do the minimum. But basically, I always wanted to help out the people who were doing so much.

And then it came down to a lucky break. There was an extra spot to hit a promotion. And I had all of my stuff turned in. I was just waiting for a slot to come up. And out of 150 some people, I was the only one in the position waiting for it. I was able to nav my first promotion, my E5 sergeant, at two and a half years. And that, again, is not very common either.

And then I just kind of took the same steps into the next role. And as I always like to kind of just tell my own soldiers, you have to stay hungry. Because there’s people around you that aren’t. You’re getting out of this what you put in. And there are people who want to improve themselves. But then there are people here who they don’t care. And you can easily go around those people. You should want to be better than those people, because that’s the legacy you’re going to leave. When you leave here, people are not going to remember who you were, or they’re going to remember who you were. Probably not have very good things to say about you. And that’s where you kind of have to worry about the impact and the impression you’re leaving. I’m sorry. That was a very long-winded answer.

[00:21:33] TU: No. That was fantastic. And the thought that came to mind as you were speaking there, Alexis, is that we stand on the shoulders of the folks that have provided us opportunities and led before us. And so, you talked about great leadership and not so great leadership, which obviously we can learn from. And now, you’ve got an opportunity to pay it forward with your soldiers. But also, to the folks that are listening, others in our profession, that I think are certainly going to look up to you and the work that you’ve been doing. I appreciate you sharing that.

If I’m doing my math right, you mentioned six years of a commitment from signing the dotted line. A little over four and a half years in, you were pinned staff sergeant. You mentioned to me before the show started that you’re getting ready to make a move from Ohio to Boston. Tell me, we got a little over a year left in your six-year commitment, and I’m trying to kind of understand, like, what is the career path? What’s the trajectory as you think about this transition from student to new practitioner? And where the intersection of pharmacy and the work that you’re doing in the army? Tell us more about what lies ahead.

[00:22:33] TU: The way I arrange my contract and the choices that I made, granted I am a doctor. And, theoretically, people once they get a bachelor’s degree, master’s degree, doctorate, will advance into the officer realm. But because of the choices that I had made earlier on and chose to stay enlisted, I will be a doctor and a truck driver all at the same time. And some people think that’s a little bit odd of a choice. But for me, I wanted that flexibility. I only have that year and a half left. But had I chosen to go an officer route, I would have had a bit more of a commitment.

And I wasn’t sure where I wanted to be tied with it. And I do have the option. If I really wanted the commission, I most definitely could. I could drop my packet, the packet to go commission and go off of the route. And I could be in in the next year. But I’m not committing that time yet just because I don’t know where – Especially with residency, and potentially a PGY2, and really where life is going, I don’t necessarily know where that’s always going to fit in. I have stayed enlisted to give myself that flexibility to get in and get out.

But since I started in Ohio, and that’s where my first unit was, and I am moving to Massachusetts, I have met phenomenal people who will live in a different state and then fly back to their drill weekends. I knew a man from Arkansas and he would come up once a month to Toledo where we would drill and work. I’m not that tough as an individual. I don’t want to catch a flight. I don’t want to deal with it. I ended up transferring to a unit in Massachusetts. And I’m in the process of doing that now. You pretty much fill out a bunch of paperwork and transfer.

I’m in that process of waiting to get picked up in Massachusetts. And I’ll stay there until I leave. And right now, I don’t have any intentions of following that commitment past six years, just because I don’t know where my career will take me. But, really, I don’t think the door has closed yet. I think I will probably come back as an officer once I have a more stable location and more stable job other than a residency. But for now, we’re going to put it on pause.

[00:24:41] TU: And so, if I’m following you correctly, Alexis, you’ll be doing residency while you’re continuing out the six years of the commitment. Is that correct?

[00:24:50] AM: Yes. I will be doing my residency as well as finishing my commitment out in Massachusetts.

[00:24:54] TU: Awesome. I love that. I think – Not I think. I know your journey is going to be an inspiration to so many. And as I shared with you before we hit record, this is a topic we don’t talk often enough about of the intersection, I think, between the health services and opportunities in the military and to serve our country. And obviously, how that can intersect with one’s financial plan here as we talk about being able to graduate debt-free. And I’m confident that several people are going to listen to this and say, “Hmm, I hadn’t really thought about that. But I don’t know where to get started.”

And so, my question for you is – I don’t want your email to get inundated necessarily. But for folks that want to follow you and your journey, where is the best place that they can go to do that?

[00:25:35] AM: They can obviously go ahead and connect with me on LinkedIn. My LinkedIn – My name is Alexis Miller. Kind of hard to find. But if you go to the linkedin.com/amillerx. It’s a play on amillerrx, no one gets it. I thought it was funny. No one else did. But that’s where you can find that.

And then of course, I will give out my email. I don’t get too many emails. It is [email protected]. I’m not always the fastest on my email. But I will try to get back as soon as possible.

[00:26:07] TU: Awesome. We will link to both of those in the show notes. And I’m so grateful for your time. Again, thank you for your service. Thank you for taking the time to share your story with our community. And Dr. Alexis Miller, a staff sergeant, really appreciate your time and the contributions you’ve made here. Thank you so much.

[00:26:28] AM: Thank you so much for having me.

[OUTRO]

[00:26:29] TU: As we conclude this week’s podcast, an 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 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 Pharmacist podcast. Have a great rest of your week.

[END]

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YFP 263: The Intersection of Financial Literacy and The Energy Burden

Posted on July 7, 2022November 2, 2022 by yfpadmin

The Intersection of Financial Literacy and The Energy Burden

On this episode, sponsored by Insuring Income, Diamond Spratling, an impact-driven environmental health professional and non-profit leader, discusses her TEDx talk, The Secret to Clean Energy: Addressing The Root Causes of Energy Burden.

About Today’s Guest

Diamond Spratling is an impact-driven environmental health professional and non-profit leader motivated to mitigate health, racial, and environmental inequities in Black and Brown communities. She is the founder of Girl Plus Environment, a national non-profit organization designed to educate, engage, and empower Black and Brown girls, women, and non-binary individuals to stand up for environmental justice in their own neighborhoods.

The Detroit native and 2021 & 2022 TEDx speaker has spent more than six years at the forefront of environmental justice. Ms. Spratling has led many environmental and health initiatives for cities and organizations such as the Centers for Disease Control and Prevention, Bloomberg Associates, WaterAid International, and Greenlink Analytics.

Episode Summary

America is in an energy burden crisis. In today’s show, we will unpack what energy burden means, the root causes of energy and utility burden, and how financial literacy and education play a role in combating energy burden. Joining YFP Co-Founder & CEO, Tim Ulbrich, PharmD, is environmental health professional and nonprofit leader, Diamond Spratling. We discuss Diamond’s TED X Talk, “The Secret to Clean Energy: Addressing Root Causes of Energy Burden,” where she addresses this crisis. In that talk, Diamond shares the disparities of energy burden for low-income communities in the United States typically made up of people of color. After Diamond shares her professional background and how she ended up in environmental health, the conversation moves to the three aspects of environmental justice and her definition of energy burden. Listeners will learn about the correlation between income and energy burden, how and why America is failing in financial literacy education, some ideas on how to implement financial literacy education in America, and why all people should learn about financial literacy from an early age. Diamond provides background and insight into the why and how of her non-profit organization, Girl Plus Environment. Through Girl Plus Environment, Diamond engages black and brown girls, women, and nonbinary individuals in all forms of environmental justice.

Key Points From This Episode

A warm introduction to today’s guest, Diamond Spratling
Diamond’s educational and professional background.
How she got into doing the work that she’s involved in today.
Her definition of environmental justice.
Breaking down the three aspects of environmental justice: Earth, built, and social.
What energy burden is and why our guest decided to speak about it.
Why income is a big factor of energy burden.
What an acceptable energy burden percentage looks like.
Energy burden versus utility burden.
Taking a look at some of the root causes of energy burden.
Why America is failing in financial literacy education.
How to implement financial literacy education in America.
The importance of educating the youth as early as possible.
Diamond provides a link between improved financial literacy and the energy burden crisis.
What Girl + Environment is and why she brought it to fruition.

Highlights

“I can work at the intersection of both environments with justice and health equity. Understanding that both are very important and both highly impact each other.” – Diamond Spratling, MPH [0:05:21]

“In the clean energy sector, we often focus so much on the environmental side of things but neglect this whole other side of energy burden, which is income.” — Diamond Spratling, MPH [0:09:48]

“There’s a lot of disparities in income and race as well that we have to be able to first, understand and identify, but also try to mitigate and eliminate.” — Diamond Spratling, MPH [0:14:19]

“We need to think hard about why are we not putting financial literacy in the classrooms, especially in communities that have generational poverty.” — Diamond Spratling, MPH [0:17:15]

“I saw a gap in who understood what environmental justice was in comparison to who was at the forefront of the justice movement.” — Diamond Spratling, MPH [0:24:24]

“How do we know how to protect ourselves if we don’t even know that environmental racism exists?” — Diamond Spratling, MPH [0:25:20]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[0:00:00.4] 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 sitting down with Diamond Spratling, an impact-driven, environmental health professional and nonprofit leader, to talk about her TED X talk: “The Secret to Clean Energy: Addressing the Root Causes of Energy Burden.” During the show, we discuss what environmental justice is, the root causes of energy burden, how financial literacy and education can play a role in combatting energy burden, and why Diamond started a 501(c)(3) nonprofit organization that shares educational resources tools and information to get black and brown girls, women and nonbinary individuals excited and engaged in all forms of environmental justice.

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 into my interview with Diamond Spratling.

[SPONSOR MESSAGE]

To get quotes and apply for term life or disability insurance, see sample contract from disability carriers or learn more about these topics, visit insuringincome.com/yourfinancialpharmacist. Again, that’s insuringincome.com/yourfinancialpharmacist.

[INTERVIEW]

[0:02:23.9] TU: Well, I’m excited to welcome Diamond Spratling to the YFP Podcast. Diamond is an impact-driven environmental health professional and nonprofit leader, motivated to mitigate health, racial and environmental inequities in black and brown communities. She’s the founder of Girl + Environment, a national nonprofit organization, designed to educate, engage and empower black and brown girls, women, and nonbinary individuals to stand up for environmental justice in their own neighborhoods.

Diamond is a Detroit native and 2021 and 2022 TED X speaker that has spent more than six years at the forefront of environmental justice. Diamond has had many environmental and health initiatives for cities and organizations such as the CDC, Bloomberg Associates, Water Aid International and Green Link Analytics. Diamond, welcome to the show.

[0:03:09.9] DS: Hi, thank you so much for having me.

[0:03:12.4] TU: Well, this is a rare opportunity and we crossed paths somewhat unexpectedly at the TED X Bowling Green State University event. I had the opportunity to get to know you a little bit as a co-speaker but also to watch your talk on energy burden, with the focus on financial literacy as an opportunity, financial educational literacy as an opportunity to really get out some of the root causes around energy burden.

Which I thought would make for a great interview on the show, so I really appreciate you taking time to come on. We’re going to talk about, and I’ll link in the show notes to your TED X talk, “The Secret to Clean Energy: Addressing the Root Causes of Energy Burden,” for folks that want to go and watch that. Before we get into the topic, love to hear more about your background, where you went to school, what you studied and what drew you into the work that you’re doing today.

[0:03:57.9] DS: Yes, absolutely. So, I started my undergraduate career at Bowling Green. I started in 2014 and I studied environmental policy and analysis, with a specialization in international perspectives. So for me, I guess, growing up, I was always more that typical environmentalist and save the polar bears, save the trees type of work.

It wasn’t until I had an internship, my second year at Bowling Green, where I was working at the intersection of energy policy in health equity. I learned about all of the different disparities between different communities that we saw in our environment, how it impacted our health, and, for me, that was very triggering, especially being a black woman. I felt like, “Wow, all of these disparities and health implications that we’re seeing are in communities where I essentially grew up.”

So I was like, okay, all the more earth side of things and the trees and things like that, those are important but I need to center, recenter my work and what I want to do in the next couple of years. So basically, I decided that I would shift gears a little bit and get into the public health side of things when it came to the environment.

After I graduated from Bowling Green in 2018, I went directly to Emory University to get a master at public health at the Rowland School of Public Health, so that I can work at the intersection of both environments with justice and health equity. Understanding that both are very important and both highly impact each other. So that’s basically how I got into the sector and I’ve been in the sector for about six years since then.

[0:05:37.0] TU: So, you already mentioned one term that I think we’re going to visit often throughout the show, which is environmental justice. Another is energy burden. I want to take a moment to define these terms. Let’s start with environmental justice. How do you define environmental justice?

[0:05:49.8] DS: Yeah, absolutely. So often, we go back to this definition that I’ve seen on the department of energy and I think that they do a really good job in making sure that when we talk about environmental justice, we’re talking more so about the human impact and human implications from our environment.

So when we talk about safe drinking water, air pollution, how does that impact our environment, specifically people who are disproportionately impacted by our environment? So, a lot of times, those are low-income communities and those are also communities of color.

So, environmental justice, since there’s this aspect of making sure that those who are disproportionately impacted by our environment are at the forefront of those decisions, and being able to have access to environmental resources that helps improve their overall mental health, physical health, and just like wellbeing as a human rights.

[0:06:38.8] TU: You talk on your website, which we’ll link in the show notes, Girls + Environment, you talk about three different aspects of environmental justice around the earth environment, the built environment, and the social environment. Can you break those down a little bit further?

[0:06:51.1] DS: Yes, absolutely. And I’ll just flag, we’re very intentional in making sure that we are interdisciplinary with how we consider environmental justice. So, traditionally, in the past, people in this sector have usually looked at this earth environment side of things, and so do we have access to safe drinking water, clean air, landfills, waste, pollution, different things like that. So that’s more so our earth environment, but I think that those have huge implications on other parts of our environments too.

We also look at our built environment. Our built environment can be, for example, do I have access to a safe park near me? What is the walkability in my neighborhood, are there sidewalks for me to even run or ride my bike, are there bike lanes? So many things, all the way down to having access to a grocery store, can be considered a part of our built environment.

The last concept that we look at is our social environment. That gives it more the feeling of feeling welcomed in your environment, feeling like you have a place. So, is there a YMCA place in my neighborhood or boys and girls club or some type of community group of people who either have shared experiences as me, look like me, or somewhere that I have a support system that can help me through everyday life situations and things like that?

We look very interdisciplinary in our environments but also, understanding that all three of these pillars have everything to do with racial justice and health equity and even just thinking about our life expectancy and quality of life.

[0:08:20.3] TU: In your TED X talk at BG, the title again, “Secret to Clean Energy: Addressing the Root Causes of Energy Burden.” Define for us, what is energy burden? And, why did you decide that this was the topic that you wanted to share about?

[0:08:34.7] DS: Yeah, absolutely. So energy burden is basically this concept of, how much are you paying for your energy or utility bills every month and in comparison to how much money you are actually bringing in each month. So, it looks at two different things, the amount of your bills that you’re having to pay but also, your income. Your annual household income.

So basically, if you just do, I like a sample of formula, you basically just divide both of those numbers. You’re able to get what your percent of energy burden is and, for a lot of households, if you have an energy burden of over 10 percent, then you are considered severely energy burdened.

As back to the TED talk, what I would say is, my primary reason for censoring it around this concept of energy burden is that a lot of times, especially in the clean energy space, we focus so much on, “Let’s get this renewable energy out there. We need to invest in solar power. Why don’t you have solar panels on your roof or wind energy?”, and things like that.

It’s like wow, all of those things are great but look at the affordability. If I can barely pay my energy bills, how do you expect me to invest in all this really cool technology, as far as renewable energy? I felt like, in the clean energy sector, we often focus so much on the environmental side of things but neglect this whole other side of energy burden, which is income.

A lot of families are not making enough income to even pay their bills. So, having to pay an energy bill or utility bill, that’s a significant burden for people, even more than we think about, from the environmental side of things.

[0:10:10.8] TU: That was really what caught my attention actually, in the practice session we did the day before. When you talked about this heightened focus on some of the clean energy things, whether it’s windmills or solar panels or other things, which obviously have value and purpose, and the technology is being advanced but if we’re not addressing some of the core infrastructure and the core issues, are we out of order, right?

I often think about investing, when we talk about it on this show, there are steps to investing, like hey, if your employer offers a match with your retirement accounts that’s low hanging fruit, you take it, and then we progress that investing plan to more brokerage accounts and other things and often, we may do those things out of order, and that really struck me of, you know, great conversations.

I think often, those gather headlines and perhaps have some political motivations that are behind them, but are we really getting to the root cause of what is necessary around energy burden? Just put numbers to your definitions. So, if energy burden as percent of annual household income spent on energy bill.

So round numbers, if someone makes $100,000 a year and they’re spending $3,000 on energy bills, they would be looking at 3 percent and you mentioned greater than 10 percent is considered a substantial burden. Is there a normal or an average or an acceptable that we would look at as a percentage?

[0:11:21.8] DS: Yeah, so around 3 percent is around like the average energy burden across the US, three, 3.5 percent. If you are above five or 6 percent, then that means that you are highly energy burdened and then if you are above 10 percent, that means you are severely energy burdened.

[0:11:39.9] TU: Okay, that makes sense and it’s just like electricity in terms of gas and electric, is this also inclusive of water? How do you typically define this when we look at the utilities?

[0:11:50.5] DS: Yeah, so when we say energy burden, we are mostly looking at gas and electric but you can also say utility burden and that will then include your water bills as well.

[0:12:02.2] TU: So, as we just alluded to, some of these other solutions around clean energy may not be addressing the root cause. So, the natural question that is, what are the root causes as it relates to the energy burden? I really found this part of your TED X talk fascinating. So talk to us about some of the root causes related to the energy burden and then we’ll talk about the financial literacy piece as a potential solution.

[0:12:20.9] DS: Yeah, absolutely. One of the things that I talk about in my TED talk is this concept of housing and also, even just redlining, which I know we think like redlining happened tons of years ago but unfortunately, lots of communities in neighborhoods are still bearing that burden.

So, when we talk about housing, like for example, I can run my air-conditioning unit all day or even just an hour, but if I don’t have proper housing conditions, if the structure of my home is horribly put together or very old, if I don’t have tons of insulation in my home, then it’s really doing nothing.

I’m just running the air conditioning or the heat all day for it to not even cool down or heat up my home. That’s a huge issue right there thinking about housing, especially when we think about section eight housing. I mean, those homes are poorly structured, rarely ever updated or invested in and therefore, a lot of those homes have to constantly run electricity.

I mean, if you think about what happened in the Bronx about a couple of months ago, there was that huge section eight housing fire, which resulted in the fact that people were freezing cold in their homes because they couldn’t afford to pay for the electric, or they’re running the gas from their stove which we know is very unsafe, or just using space heaters which also can be unsafe as well.

So, housing is definitely an issue here, but the other thing that I often like to bring up is just this concept of income disparities and thinking about communities of color, especially black communities, how much we are getting paid in relation to our white counterparts. So, again, when you go back to this concept of energy burden, it’s not just how much you have to pay for utility bills, it’s how much annual income you’re bringing in, in the first place.

We’re already set back by whatever the difference is between white counterparts and black communities and how much we’re bringing in financially every year, that’s a huge impact in itself as well. I think there’s a lot of disparities in income and race as well that we have to be able to first, understand and identify, but also try to mitigate and eliminate these issues as well.

[0:14:30.7] TU: Yeah, and I think it’s so important to go back to the definition, two parts of the equation, right? The utilization and then the utilization relative to the income, and I think you just articulated so well some income gap and challenges, and I think on the utilization, we’re not talking here about, “Oh, I’d like to keep my home at 75 degrees when it could be 72. We’re talking about infrastructure problems that lead to unnecessary high burdens on energy use, and I think that concept, to me, was really something you articulated so well.

Let’s talk about some financial literacy piece as a potential solution. Obviously, this is a multipronged issue as well as an approach that’s needed to address it, and I just wanted for a moment talk about some statistics that were reported by the University of Chicago around financial education and literacy, and we’ll link to these in the show notes, and then I’ll get your thoughts, Diamond, a little bit on why is the financial literacy so inadequate in this country and what are some of the potential solution.

So, I’ll read a couple of these, nearly 50 percent of high school seniors say they wish they learned personal finance in school. That is according to discovery education in 2018. A recent study finds that differences in financial knowledge account for 30 to 40 percent of retirement wealth inequality and that’s from a 2017 study by Lucardi et al. A 2016 survey indicated at 31 percent of young Americans agreed that their high school education did a good job teaching them healthy financial habits. Bank of America, 2016, meaning that the majority did not think that.

A study from FINRA in 2015, students exposed to various financial educations at high school saw their credit scores increased by an average of 20 points and their probability of delinquency reduced. I mean, these go on and on but it impacts retirement savings, it impacts the ability to deal with energy bills in the moment, it deals with access to housing through credit and other issues.

As you hear those statistics, why has this been an area that we just have not done a good job, around financial education and literacy?

[0:16:26.2] DS: Yeah, that’s a big question. I mean, it’s hard to even find the why. A lot of those statistics were from students or from professionals who thought back to their education in high school and I mean, even thinking about my personal experiences, I’ve never taken a financial literacy class and I think that that’s true for a lot of us. As to why they don’t teach it to us, I have absolutely no idea.

I mean, a part of me is thinking, on the back of my head like of course, they don’t want all of us to know how to protect ourselves financially, you know? They want the rich to get richer and you know, whatever the case may be, but I think that it has had a continuous toll on us because I mean, it is not just the financial issue, it is a public health issue, a mental health and everything else.

I think that we need to think hard about why are we not putting financial literacy in the classrooms, especially in communities that have generational poverty, especially because how else do we get rid of that cycle if there isn’t really a generation that is being taught what to do as far as our finances.

[0:17:35.4] TU: Yeah and I couldn’t agree more. I mean, I think we’re finally starting to see a little bit of traction on recognition to your comment about it’s not just about the dollars. It is a public health, it’s a mental health issue. We’re finally starting to see financial wellness as a key component of wellness and that is certainly a new development I think in the last several years, but it’s long overdue.

We’re starting to see more states, Ohio, finally coming onboard with requiring some personal finance education literacy through the K12 program. That really is baseline and we certainly know from our experiences in undergraduate and professional programs in pharmacy education, despite the awareness that we continue to bring to the topic, it’s slowly developing, but it’s slow, right?

I think there may be some baggage of, “Well, this is a pharmacy degree. We’re not here to talk about personal finance.” But to be an effective clinician, be an overall wellbeing, this is an important part of it, just like we address mental health with our students, right? Just like we talk about other public health issues. So, let me ask you in terms of where we go, sure, we could dwell on why this hasn’t been the case or where we go.

Are there programs or initiatives that you’ve seen to be successful in this area around financial literacy and education? If so, what do they look like? Who is offering? When are they starting them or if not, what do you perceive to be the ideal place of how we implement financial literacy and education?

[0:18:57.4] DS: Yeah, that’s a great question and I’ll probably have to get back to you on this, specific resources. What I would say as far as what I think is most ideal and most critical here, is definitely centering financial literacy in education as young as possible. It is never too young to learn about financial literacy, and I think also, when we use students to learn about financial literacy, then a lot of that gets reflected onto the parents because many other times it’s a generational cycle to instill.

The kids may even know how to protect themselves financially but parents may not. So I think that parenting programs are just as critical as well because you don’t know what you don’t know and so you lean on, “Oh, well my parents did this” or “My parents told me not to get a credit card” or anything like that. So we go based off of what people who we know have done or have not done.

I would say definitely centering conversations in literacy that are directly within the community, that are targeting both students and parents and even grandparents, and being able to provide those resources on a generational side of things, as opposed to just like, “Here is some resources. Good luck” those are, you know, it’s a small piece but I think also just drilling things into people like many, many times.

I think that that’s very, very critical. My boyfriend actually teaches a generational wealth class on Sundays to my family and he’s like, “Well, I thought I already covered this?” I was like, “Cover it again.” Cover it a million times because people need, you know, we want things to be drilled into us as many times as possible. I think doing that and making sure that it is very community centered and family centered is all the better, especially when building that trust with people.

Because traditionally, we’ve been told not to do this and not to do that but really, it’s not always the case, especially when it comes to different financial advice as well.

[0:20:49.3] TU: I love that. I love the focus on community-specific, community-centered. I love the aspect of the family-centered, you know, bringing in the education that includes the families at large. I think the other thing, I am linking those two, research has been done on drug abuse education and really the importance of starting that as early as the pre-k level and it’s longitudinal throughout.

I think something similar in the personal finance space, that it’s got to be early. As life goes on, we carry more baggage with us about finances. We start to hear more stories and scripts and it impacts us, and the longer we go, the harder it is to change. So I think the earlier we can start the conversation, the more longitudinal it can be in the repetition and, to your point, that can happen overtime is so important.

So what do you see, I mean perhaps obvious, perhaps not so obvious, but what do you see is the direct link between improved financial literacy and education and the energy burden crisis?

[0:21:43.5] DS: Definitely. So I think that there are a lot of components here, especially when it comes to education. I mean, a lot of the advocacy or the work that I talk about often goes back to education, because we know that education is linked to how much you know about a specific topic, down to how much you’re potentially going to get paid or your percentage of going to college and things like that.

I think that being able to one, educated ourselves or to be able to have access to education is a concept within itself because a lot of us don’t have access and don’t have good quality educational systems that can help us to earn higher amounts of income every year. A lot of that goes into what’s your education, what did you learn, are you going to go to college for example, which I know college has implications on the financial side of things.

But being able to understand whether or not we have access to an educational system that advocates for us to be able to earn more income, but I think also when we think about this education system, the side of education within the housing and knowing what to look for when buying homes or being able to be in a position where you can own a home, because the impacts that renters, people who rent a home versus people who own a home, there are tons of energy burden disparities with between that too.

So, if you are renting a home, you have less autonomy on even being able to make updates or changes to your home that helps to lower your energy bill, as opposed to someone who, “Oh, I own this home so I may be able to make updates to my house” because a lot of times landlords are like, “Oh, well I don’t care. You need to pay the bill on the first regardless.” So that’s a huge concept too when it comes down to being in a position where you can own a home or purchase a home as well.

[0:23:31.0] TU: Yeah and I think, you know, as I think about the financial literacy, I could see the connection, as you mentioned, to some of the education and the awareness around owning versus renting and updates that you can make to your home or what to look more in buying a home, but it still feels like there is a core issue. You know, I’m thinking about folks that had been in homes for 10, 20, 30 years.

Income gaps have already been established, not to say there can’t be movement or change, but there has to be some changes in advocacy for housing changes and infrastructure and things that may be dependent of the individual and their own financial education literacy and their own financial position as well. Talk to us Diamond about Girls + Environment, what is it? Why did you start it and what are you hoping to accomplish?

[0:24:12.0] DS: Yeah, of course. So Girls + Environment, we are a national organization, we’re a 501 (c) (3). I actually started it my first year at Emory, so back in 2019, and I created it because I essentially saw a gap in who understood what environmental justice was in comparison to who was at the forefront of the justice movement.

So for me, back in 2016 when I was doing my internship first learning about environmental justice, I remember being so fueled up because I learned there were asthma rates in Black and Latino communities that were skyrocketed, and I was just so mad about the air pollution and the asthma rates comparison, and so this was back when Facebook was really popping.

I would go on Facebook and type these long statuses about how mad I was and try to educate my family and friends and no one was really interacting with the posts. They’re like, “What are you talking about?” I realized that, okay, we are experiencing the greatest amount of environmental burdens but none of us even know what’s going on in our own backyards, that’s a huge issue.

How do we know how to protect ourselves if we don’t even know that environmental racism exists? So for me, that was a huge problem and I wanted to get more people who look like me at the forefront of the sector, so Girl + Environment was created specifically so that we can educate black and brown communities on what environmental justice is, engage them in the sector and empower them to be leaders in the sector.

So that they can stand up for themselves and their neighborhoods, but in a very fun and creative way too because I also acknowledge that there is tons of papers out there, literature, but no one wants to read that. Give it to me straight, give it to me in a fine creative way, that is why you’ll see on our page it’s very fun. It’s supposed to be very engaging so that people don’t even realize, “Oh, I’m learning about environmental justice right now.”

Yeah, you sure are, and you’re learning about how it impacts you, your health, your mental health and everything else. So, that is basically why Girl + Environment was created and in the pipeline, we have tons of just different programs that we are putting together. We actually just got funded by Al Gore’s organization for protecting our energy project, which helps to educate black and brown women in Atlanta about energy burden and to put them at the forefront at Georgia’s energy policy process that’s going on this summer.

[0:26:33.9] TU: Wow, congratulations. That’s awesome.

[0:26:35.8] DS: Thank you.

[0:26:37.3] TU: Yeah, no offense to the Department of Energy or research papers but they’re boring, right? I think the platform you’ve created, I love the vision, I love the platform. It’s girl+environment.org. From there you could join the community, you can look at projects that are ongoing, you can read the blog, you can donate, and get involved. So I love the vision of what you’ve created and we’ll link to that in the show notes as well.

So for folks that Diamond want to follow the work that you’re doing and the journey that you’re on, where is the best place that they can go to do that?

[0:27:04.0] DS: Yeah, absolutely. So you can go on our website, girl+environment.org. We’re also on Twitter @girlenvironment and on Instagram @girl+environment and then you can also follow us on Facebook, Girl + Environment and my personal LinkedIn is just my name, Diamond Spratling and I am also on Twitter as @diamondsprat but I’ll be sure to send you all of those links and things like that in case it’s helpful.

[0:27:28.2] TU: Awesome. We’ll include those in the show notes to go along with the TED X talk again, The Secret to Clean Energy: Addressing the Root Causes of Energy Burden. Diamond, thank you so much for taking time to come on the show. I appreciate it.

[0:27:38.0] DS: Yeah, absolutely. Thank you so much for having me. I had a great time.

[END OF INTERVIEW]

[0:27:42.1] TU: Before we wrap up today’s show, let’s hear an important message from our sponsor, Insuring Income. If you are in the market to add own occupation disability insurance, term life insurance or both, Insuring Income would love to be your resource. Insuring Income has relationships with all of the high quality disability insurance and life insurance carriers you should be considering and can help you design coverage to best protect you and your family.

Head over to insuringincome.com/yourfinancialpharmacist or click on their link in the show notes to request quotes, ask a question or start down your own path of learning more about this necessary protection

[DISCLAIMER]

[0:28:18.9] 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 it is not intended to provide and should not be relied on for investment or any other advice. Information of 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 post, and podcast is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analysis 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 262: How Two Pharmacists Paid Off $250k of Student Loan Debt

Posted on June 30, 2022November 2, 2022 by yfpadmin

How Two Pharmacists Paid Off $250k of Student Loan Debt

Kristen & Nate Hedrick to discuss their journey in paying off $250k of student loan debt, their motivation and why for aggressively paying off the debt, and the role a side hustle and real estate investing played to help them achieve their goal.

About Today’s Guests

Nate and Kristen Hedrick met at Ohio Northern University and were married in 2013. Nate is a pharmacist with Medical Mutual and a real estate agent with Berkshire Hathaway. Kristen is a pharmacist with Bon Secour Mercy Health. Together, they graduated with over $300,000+ in student loan debt. They enjoy visiting National Parks as a family. Today they live in the suburbs of Cleveland, Ohio, with their two daughters, Molly and Lucy, and their rescue dog Lexi.

Episode Summary

How do you go about aggressively paying off a $250,000 student loan debt without feeling overwhelmed? To help answer that question, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, is joined by fellow pharmacists Nate Hedrick, PharmD, and Kristen Hedrick, PharmD, BCACP. The Hedricks tell us how they successfully paid off over $250,000 in student loan debt, their motivation for tackling that debt, the pivotal moment that sparked making repayment a priority, and the role a side hustle and real estate investing played in their journey. After a brief history of Kristen’s background, listeners will hear what motivated the couple to take an aggressive stance on their debt repayments, how a life-changing event and one book altered their financial philosophy, and how the pandemic helped them focus on their strategy. Nate and Kristen share their reasons behind paying their debt off now instead of putting their money toward investments and how they found an additional $3,443 per month to make their goal attainable by reducing expenses and increasing their income. This earnest conversation takes us through the possibilities of working full time, raising a family, making investments, and paying off a huge debt, all at the same time. Nate and Kristen talk about their life after paying off this debt and share some advice for pharmacists who may be struggling with a similar debt situation.

Key Points From This Episode

Kristen’s background, how she ended up in pharmacy, and what she’s doing now.
What their student loan debt looked like at its peak.
How student debt can creep up and surprise you.
The initial feelings the couple had towards their debt and their plans to pay it off.
What motivated our guests to come up with an aggressive plan for paying back their debt.
How a life-changing event (and a book) in 2016 changed everything.
The global pandemic as a moment of inspiration.
What they had to change in their lives to be able to make the monthly repayments.
Paying off debt now versus investing for the future.
The way the couple used ‘double motivation’ to reconcile an age-old debate.
How our guests were able to raise a child, invest, and pay off a huge debt at the same time.
Nate’s decision to pursue real estate investing and what that meant for their debt repayments.
The approach the couple has taken to make real estate investing work for their family.
Other strategies that helped to pay off the debt aside from cutting expenses and real estate investments.
The benefits of receiving objective, third-party advice.
What life is like now after paying off their massive debt.
How paying off the debt helped Nate make an important career decision.
Kristen’s advice for the pharmacist struggling with debt.
Nate’s parting words of wisdom.

Highlights

“That was the worst that it got and, that same month, for what it’s worth, we had a negative net worth of $306,000. We had about 10k to our name and a bunch of debt to add on to that.” — Nate Hedrick, PharmD [0:03:44]

“I had no plan early on until we developed the ‘why’, which was getting our financial house in order so that we could live the way that we wanted to.” — Nate Hedrick, PharmD [0:06:23]

“The expenses were the catalyst, and then it was the extra income side of the equation that really boosted everything to actually make it possible.” — Nate Hedrick, PharmD [0:13:37]

“Spending more time with the kids without having that student loan debt, and being able to do more things and travel more, it feels like it’s definitely paying off in the end, with making some of those sacrifices.” — Kristen Hedrick, PharmD, BCACP [0:17:16]

“One great thing about real estate investing is even if something happens, you still own a building.” — Kristen Hedrick, PharmD, BCACP [0:22:00]

“Find something that is going to supplement your life that the more effort you put into it, the more reward you get out of it. That is a really great way to set yourself up for success.” — Nate Hedrick, PharmD [0:29:32]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[0:00:00.4] TU: Hey everybody, Tim Ulbrich here. 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 sitting down with Kristen and Nate Hedrick to discuss their journey of paying off $250,000 of student loan debt. In this show, we discuss their motivation and why, for aggressively paying down the debt. What the pivot moment was that motivated them to make the debt repayment a priority, how they were able to come up with more than $3,000 per month extra to throw towards the loans, and the role a side hustle and real estate investing played in helping them pay down the debt.

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 240 households in 40-plus states. YFP Planning offers free only, high-touch financial planning that is customized for the pharmacy professional.

If you’re interested in learning more about 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 into my interview with Nate and Kristen Hedrick to learn how and why they aggressively paid off $250,000 in student loan debt.

[INTERVIEW]

[0:01:23.4] TU: Kristen and Nate, welcomed to the show.

[0:01:24.7] NH: Hey Tim, good to be here.

[0:01:26.1] KH: Hi.

[0:01:27.0] TU: So Nate, obviously, you’re a frequent flyer. You’re old news so I’m not even going to spend a whole lot of time focusing on you. Many folks have heard you on the podcast before, whether it’s this show, talking about home buying, whether it’s the Real Estate Investing podcast on Saturday mornings, of course, Nate being the cohost of that show.

So, we’re going to focus a little bit more on Kristen’s background as we get started, and we’re going to jump into more about your debt-free journey and how ultimately, you guys were able to knock out $250,000 of debt, and what that has meant to you guys personally, to your family, as well as also the financial goals and plan that you have going forward.

So, before we jump into that debt payoff and that journey, Kristen, let’s start with you. Tell us a little bit more about your background, what drew you into pharmacy, where you went to school and the work that you’re doing now.

[0:02:13.0] KH: Yeah, thanks. I had some extended family members in pharmacy so I just thought it would be a good career path, and looked at the different pharmacy schools and found my way to Ohio Northern in the middle of cornfields, and no cellphone reception and for some reason, that’s where I wanted to go. I think we all know it’s a great campus and community there.

So went to Ohio Northern and that’s where Nate and I met. I completed my residency here in Cleveland, Ohio. Now I work for a large health system doing population health on clinical pharmacy, and following patients with their chronic disease states and helping them with their medicines, and helping in here in Cleveland.

[0:02:50.8] TU: Kristen, it’s funny you mentioned the cellphone reception in Ada Ohio, Ohio Northern University. I remember, I maybe as a P3, P4, just a few years ahead of you guys, but it was a big deal that they added a tower on campus, and I think we got one bar, maybe two bars, but not a whole lot going on in Ada Ohio. I had the chance to go back recently and take Jess and the boys. It was so fun to see campus and really relive some of the memories in that place.

So Nate, tell us about the student loan debt at its peak? What were you guys working with and then, from there, we’ll get into more of some of the motivation and journey of paying it off.

[0:03:26.4] NH: Yeah. So, when we graduated and totaled everything up and, I think it was even a month or two after we graduated that I even wanted to look at it. Because it was the initial plan of, “I just won’t look at it and then it won’t be a problem.” And when we totaled it all up, looking back at our highest count, we were at $316,000 in student loan debt at one point.

So, that was the worst that it got and, that same month, for what it’s worth, we had a negative net worth of $306,000, so we had about 10k to our name and a bunch of debt to add on to that.

[0:03:54.8] TU: I’m curious, did that surprise you guys? One of the stories I often share is that, it’s somewhat embarrassing, but when I was in pharmacy school, it felt a little bit like monopoly money, and it was all of a sudden when I crunch the numbers and I was like, “I owe how much, and how much interest, and what’s my net worth?” It just caught me off-guard, and it shouldn’t have. Were you expecting that or was that number somewhat a surprise at that point?

[0:04:15.4] NH: I agree, it was just totally like made up funds, you know? Every quarter or every semester, I’d have to go and submit for what I needed, and it was the tuition plus a little bit of living expenses, and I would just submit for it and it would get added into this imaginary pile of money somewhere, and I don’t think I ever checked the balance while I was in school, I don’t know why, I don’t know why I would have.

[0:04:35.7] TU: You’re dating yourself Nate, when you talk about quarters by the way. So that ain’t a thing anymore.

[0:04:40.7] NH: Old school, how I work.

[0:04:42.7] TU: Kristen, tell us about the plan that you guys had for the student loans after graduation, after you got married in 2013. How did you feel about the debt overall and then, what was the thought in that moment about how are you going to pay this off?

[0:04:55.7] KH: I think our main thought was it’s overwhelming. It’s just such a large amount that it feels so ambiguous that we thought that we had this plan. We had always wanted to try to pay it off within 10 years. I think I was a little more on track of, “Oh, I want to pay this off in 10 years” and we had some advice from a previous financial advisor that had said, “Oh, it’s just student loan debt, everyone has it, it will be okay.” We changed it to 30 years so we could have minimum payments but always pay extra if we wanted to and, ultimately, we just found that that eventually did not work as well for us.

We needed a more targeted plan to get us on track with what we were doing. We had always been paying the amounts, but I think it was how we were planning to target to actually pay it off. It always felt like this end date that we were never going to get to.

[0:05:44.4] TU: One of the questions I like to ask folks, and we’ll talk more in a little bit about how aggressive you guys were to really get a chunk of this paid off, but I like to understand, what’s the why? What’s the motivation behind it? It’s one of these things, as you mentioned, you can take them out 25, 30 years if you want to. Obviously, you guys made a good decision to be much more aggressive. Tell me more about for the two of you, for your family, why was that important?

[0:06:08.2] NH: It’s funny you say that because I think until I had a why, it wasn’t important. Like I said, I didn’t look at it, I barely wanted to check it. I think at one point in residency, I put myself on the graduated repayment plan and my only motivation was because the payment today is lower and that seems like—that seems better, right?

I had no plan early on, until we developed the ‘why’, which was getting our financial house in order so that we could live the way that we wanted to. Travel, work less, work in the capacities that we wanted to, all the things that have led us to this point. Until I had that in place, there wasn’t a why and it didn’t matter.

[0:06:42.7] TU: Yeah, I think that’s such a good encouragement for folks that are in the midst of their journey, or maybe have wondered into the repayment or for that matter, the financial plan at large, and feel like, “Hey, maybe I’m progressing but not as quickly as I would like to. I’m a little bit stuck.” Really going back to what gets us excited, right?

The topic of money, money is a tool. So, what gets us excited, why do we care bout this topic of money, why do we care about debt repayment, why do we care about saving/investing for the future, why do we care about giving? And then using that as the motivation to drive some of the action and the plan going forward.

So, Nate, what happened in 2016 that was really a motivation to say, “Hey, we’ve got to do something different?”

[0:07:22.0] NH: Yeah, that really is when it changed for us and, again, we’d been paying on them and, every once in a while, we get the idea that, “Hey, we should throw in some extra money because these loans are huge.” We would do it for a couple of months and I feel like we just were inconsistent. But in 2016, we got pregnant with our first child and, again, I tell this story on the podcast several times, but I read Rich Dad Poor Dad and it completely changed my mindset about money and what I wanted to do with money and what I wanted to do with my life and work, and just how I looked at finances.

It’s crazy it took that long to figure that out but I had no formal financial education. We go through pharmacy school, not business school, and until I read that book and changed how I wanted to approach finances in general, again, I didn’t have that why behind it. I didn’t have that motivation, so that’s what really jumpstarted us. I think it was a combination of, “Oh crap, we have a kid on the way and we have to pay for a lot of stuff” and again, this mindset shift that occurred, at least for me.

[0:08:16.1] TU: Kristen, I’m curious. I can just see Nate, because I know him now, I could see him like this totally nerding out over Rich Dad Poor Dad and coming to you with all these ideas and, “What about this, what about that?” Were you equally on fire in that moment or was there different motivations that really led you to say “Hey, we’ve got to do this differently?”

[0:08:34.4] KH: Yeah, I think I had always wanted to pay off the loan. Again, it was just so—it was a large amount that I think I didn’t know how to get there. When Nate said he read Rich Dad Poor Dad, he kept talking about it and talking about it. I think finally, in 2019, I read it, I said, “Oh, this is a really good book, I should have done it sooner”

So, I think we are a really good team together, in trying to work together and get those payments down, and Nate was very much more into it. I think at the time, I was like, I’m growing a human, I’m just going to keep doing what I’m doing, and that was the time that Nate entered real estate. He’s told this story before but, I’m six months pregnant and he goes, “Oh, I think I want to get my real estate license.” This is a time most people would have been getting board certified.

He’s like, “I’m going to go get my real estate license.” He had classes multiple times a week and I’m pregnant, trying to take care of the house and do all these things, getting ready for a baby. So, it paid off in the end and I’m glad that he did it, but I think in the moment there was also that stressful situation for me, but he’s a jack of all trades. He does lots of things and keeps busy, so it’s good.

[0:09:36.0] TU: We’re going to come back to that in a little bit, of what role did that play, Nate, for you, in terms of pursuing that, as you call, a side hustle. It’s much bigger than that, the work that you’re doing now, obviously, but why was that so instrumental, and not only to the numbers but also to some of the mindset and the motivation behind the financial plan and the journey that you were on?

I want to first talk about, though, Nate, walk us through what happened in the pandemic that really allowed you guys to say, “Hey, we’re going to get specific about when we’re going to payoff a big chunk of this debt, what it’s going to take each month.” Talk to us about what happened during the pandemic that led you to the decision around how you were going to pay off a huge portion of that debt.

[0:10:15.5] NH: Yeah, so, like I said, 2016 is where we started getting pretty serious, but even then, it wasn’t truly resolute plan, right? It was just, “Okay, we really got to be focusing on throwing extra money at this” and we did a lot better. But in 2020, we had a month or two in the pandemic and realized, “Okay, we’re not traveling as much, we’re not going to be going out to eat as much, everything shut down, let’s use this time to take the extra money that we’re not spending and really attack that loan.” At one point and, again, we were talking this morning, it was right at the end of the year, we said, “Okay, this thing is not going away, let’s really use next year to just get rid of this loan.”

So, right in December of 2020 and going into the beginning of the New Year, we said, “Let’s figure out a number. What is it that’s going to take to get this loan knocked out at the end of the year? Who cares of the balances right now, we’re going to do it in a year, let’s make sure to get it done.” So, we did some crunching of some numbers and basically said, “Okay, if we can pay everything we’re paying today but also throw an extra $3,443 at the loan every single month, mine will be gone by the end of the year and it will be just knocked out.”

So, that number, I wrote it on the big note card over here and it became like—actually got it here, I’ll grab it. Here you go, so there’s the evidence, right? 3,443. So, that became—I put that everywhere and it became the mantra of like, “If we can do that every single month, this will be gone” and that was such a huge motivator for us.

[0:11:32.8] TU: I don’t want to brush over that, because we’ll talk about it, I mean, that’s a big number, so we’re going to talk about the how of that, but tell us more about how you were able to get to that conclusion and get on the same page with that conclusion? What I’m specifically getting at here is, was it a, “hey budget status quo and we’re going to find ways to grow our income”? Was it a, “we’re going to cut some expenses”? How did you guys work through the details, Kristen, to ultimately say, “Yup, it’s $3,443 and this is how we’re going to do it.”

[0:12:04.5] KH: I think it was a little bit of a combination of both. During the pandemic, we had a little bit more interest. I think also, in doing some real estate investing and had an opportunity, we said, “Okay, do we take this money and do we put it towards real estate or do we pay down the loan more?” and eventually, we decide real estate, but we said, “Hey, like, maybe we should aggressively pay off our loan a little bit more if we are traveling and doing these things.”

So, I think in December, we had a lot of discussion about it and both of us just decided yes, we both want that to be our goal, that starting January 1st, we really start cutting back on what we’re spending. I think, really, from any area that we could, we went thorough our budget, we scrubbed it. We said, “What are we spending money on, what are the subscriptions we have, what can we cut out, what can we save money on?”

“Which of those little purchases can we just stop doing? Which things do we think that we need, can we actually hold off on buying?” and then, certainly, Nate’s side hustle helped with that as well. So, I think it was both a combination of, let’s cut back to really bare minimum spending. We weren’t eating out, we weren’t getting the extra cups of coffee from Starbucks, we weren’t doing the purchases at Target that said, “This is what you need, and this is in the dollar spot.” We just stopped all of that. And Nate worked as hard as he could with his real estate; it really is a motivator to keep putting that extra money towards it as well.

[0:13:22.3] NH: Yeah, I think we quickly realized that trying to find for an extra $3,000 in the budget. We weren’t over spending by three grand every month, that was not it, so it became my challenge to say, “Okay, well, how can I work at this side hustle to really get us the rest of the way?” So, the expenses were the catalyst, and then it was the extra income side of the equation that really boosted everything to actually make it possible.

[0:13:44.7] TU: Yeah. What I love about that is, certainly, cutting expenses, especially short-term, if you’re focused on a goal, you were talking about debt repayment, can be really valuable but it also can be a grind. I mean, it can be soul sucking sometimes, you know?

I think that one of the things I love about the approach that you took is that if you’re moving both sides of the equation, there’s a different level of momentum and mindset that come from that. Maybe the numbers aren’t as big for other folks that are pursuing ideas, but if you can both focus on, “Hey, how can we draw the income and how can we keep the expenses?” you all of a sudden feel like you’re picking up momentum in a significant way, but I don’t want to brush over that number.

$3,443 per month, that’s, for many pharmacist, if we assume, hundred, $120,000 of wage, it’s like, it’s about half of take home pay. I mean, for a lot of folks, we look at that at a monthly basis so that’s certainly commendable, and that’s a big number. Nate, I want to ask the question that I know the listeners are thinking, which is Nate, Kristen, you guys are smart. $3,443, why not invest that money?

Why not put that out so we could see that grow and compound over 20, 30, 40 years? Like, how did you guys reconcile this ongoing debate, which is maybe a little bit of a moot point right now because the administrative forbearance, but this ongoing debate of, “Should I pay down the debt or should I invest for the future?”

[0:15:03.9] NH: Yeah. This is something we struggled with for years. Should we go out and buy another rental property or should we just take this money and throw it at the loan? That’s been the back and forth. Like Kristen was saying, we were evaluating whether we should be doing real estate or paying down the debt.

We challenged ourself to say like, “Can we do both?” and so, for me, again, working and trying to add extra income to the equation. It became a game of, “Okay, if I can make $3,000 a month extra, that’s going to get us there. But if I can make 4,000 or 5,000, that’s another couple of grand I can put at the real estate investing budget.”

So what we have, we had a bucket in LI, in our LI bank account, that was the real estate investing fund and we still have that, we still use it, it is a great way to separate our money. I had to pull from that in any month that I didn’t make enough income to really make the difference, I had to pull out of that. So it was like this, I was afraid to give it up. So it became a challenge to myself and to us.

We need to cut our expenses and raise our income in a way where I can keep padding that account, that bucket, while also meeting our number. It was a double motivator of let’s get rid of the debt and I don’t want to lose sight of the other thing that I’m really passionate about. So, let us find a way to do both.

[0:16:09.8] TU: Kristen, we both know that kids could be expensive. We love them, but it can be very expensive. I think one of the challenges folks have that are raising young family, whether it is debt repayment, whether it is achieving other financial goals, is it’s an expensive phase of life, right?

The data suggested it’s multiples of hundreds of thousands to be able to raise a child, and I am curious of how you guys were able to reconcile this with young ones? I know you guys are so active and intentional as a family now. When you’re looking ahead to say, “Hey, this is a sacrifice now but it is going to allow us to really push our goals forward as a family later in the future.” Tell us about your thoughts on that.

[0:16:46.9] KH: For sure. I remember being pregnant in 2016 and just thinking like, “Oh my gosh, I already feel like we’re living paycheck to paycheck, how are we possibly going to raise a child and afford daycare?” We even joke now, our big expense is mortgage. Childcare and student loan debt was there, our mortgage was the least expensive of all of those.

So yes, certainly having kids is—we always felt like we knew we wanted to have kids and it was just figuring out how do we plan for that. I think, especially now, spending more time with the kids too without having that student loan debt and being able to do more things and travel more, it feels like it’s definitely paying off in the end with making some of those sacrifices or making those adjustments.

Really, that mindset change, I was joking this morning, like you said Tim, it’s mindset changing. In 2021, we actually kept a list of things of, what are things we didn’t buy that we’re going to buy when the student loan is paid, and I was laughing because I’m like, “I still haven’t even bought these things yet.” We just found that maybe we don’t actually need them.

[0:17:44.7] TU: Yeah and some of those behaviors. That’s what I always encourage folks, whatever goal you’re working towards, some of those behaviors you implement in that season will stay with you for the long run. Certainly, there’s a time and place to loosen the reigns a little bit and make sure we’re living a rich life today as well as planning for the future, but we’ll talk about what that looks like for you guys.

But some of those behaviors can stay longer, which I think is really an incredible part of the journey. I want to touch on two things we’ve mentioned I think play a really important role to this journey, which is, number one, that you talk about the side hustle you had working full-time as a pharmacist, as a real estate agent that allowed you to accelerate some of the goals and momentum.

Then the second being the investing in real estate, which much of our community already knows the work that you there on the Real Estate Investing Podcast but talk to us first about the side hustle as a realtor. When did you become a realtor, why did you become a realtor and you know ultimately, how have you been able to balance this while you are also at the time working full-time?” You are raising a young family, tell us about the decision to pursue that work and the role that it played and the debt repayment journey.

[0:18:51.3] NH: Yes, I mentioned that mindset shift that occurred in 2016. I realized I needed something else that was going to be able to supplement my pharmacy career, something where I could put extra effort in and get extra reward from doing that, real estate became a natural fit. Again, it is mentioned a dozen times in Rich Dad Poor Dad and I started reading other things about ways to diversify income streams and, you name it, right?

Real estate was in that conversation. I talked to my father-in-law who has been in real estate for years and he’s like, “You should just get your license.” At the time that felt like, “Well, that’s a different career. I can’t do that” but as I looked into it, it was actually a really reasonable option to supplement that. So I went, like Kristen said, to classes in 2016, got licensed in early 2017 and I assumed that everyone was all of a sudden coming to me, right?

All my family and friends were going to flock to me and say, “Nate, buy and sell me a house” and it was, I think, eight months before I had a real client and actually closed the deal. I mean, it was a long time, and that’s because I wasn’t putting the right amount of effort into it and I wasn’t targeting what I needed to be doing, right? I wasn’t niching down and, again, that’s what led to the creation of real estate RPH and all the work that I do with pharmacists and the real estate community.

All those things progressed down the road to the point where I am at today where, again, now I get to work with a bunch of active clients here in Cleveland. I help people all over the country with our real estate concierge service and it is a really cool way to put my passion for real estate into the world of pharmacy that I started out in and, again, it’s also been a great way for us to supplement our income stream just because it is something where I could put more effort in and get more dollars out as a result from doing that.

[0:20:21.6] TU: Yeah. I want to put a plug in, just so you don’t have to as well, but I think that service has really been so valuable to the community. So, if folks are looking to buy a home, sell a home, looking to buy an investment property and they’re looking for an agent that would be a good fit for them. It is okay if you’re not in the Cleveland area where Nate is, he’s built a network of agents all across the country that have supported other pharmacist.

So, if you go to yourfinancialpharmacist.com, you click on home buying, you’ll see a section for find an agent and from there, you can get connected with Nate further.

Kristen, I want to ask you about the real estate investing side just because Nate talks about this on the podcast every week but I know, because I’ve seen it offline through some of the times I am talking with Nate, you guys are crunching numbers on the property and you’re on the spreadsheets punching numbers, “Is this a good deal, is this not a good deal?”

Tell us more about the vision that you guys have had for real estate investing for you as a family, why that’s been a good fit, and the approach that you’ve taken thus far in your real estate investing journey?

[0:21:17.5] KH: Yeah, I think we always had an interest in real estate investing. You know, my family has some experience with that, like Nate mentioned, my dad is a realtor, so we knew its something we eventually wanted to do. It was just figuring out ,how do we put it in as part of our plan? But when Nate said he was interested, I was all onboard, but I was also that type-A risk averse pharmacist as in, “How do we do this? I have no idea.”

I vividly remember a lot of my commutes, listening to Bigger Pockets, reading a lot of real estate books just to fill my brain with the information I felt that I needed to feel comfortable with real estate investing, and we always knew that we wanted to have those properties. I think one of the biggest things I had learned from Bigger Pockets was, one great thing about real estate investing is even if something happens, you still own a building.

You still have something physical there that you could sell and we just—we always knew we wanted it to be something to supplement with one of our investments.

[0:22:13.4] TU: Yeah, so right now you guys have property, correct me if I am wrong, you’ve got property in Northeast Ohio and then you’ve also got property outside of the area, correct?

[0:22:22.0] NH: Yes, so we’ve got properties here locally and then some up in Michigan as well.

[0:22:25.7] TU: Awesome, love that. And folks can tune in to the Real Estate Investing Podcast for more stories of other pharmacists real estate investors. So, we’ve talked about really three main buckets that were instrumental in paying off this $250,000 of debt and that was, I categorize it as hustle, cutting your expenses that more than $3,000 per month, growing the income through the side hustle, and then also looking at how you’re able to build a real estate investment portfolio. We’re there other strategies that helped you along this way of paying off this debt?

[0:22:55.8] NH: There are little things. I think one that comes to mind for me is that we refinanced that loan, I think four different times, and a lot of that was because we were getting low interest rates every single time, and the other is because we were able to get big bonus. So, if you have been on any of the YFP resources for loan pay down or for loan refinance, you get cash bonuses depending on your loan balance.

A couple of times we would go out and refinance it, wait a couple of months, refinance it again, and we’d get a check and a lower interest rate, it just made a ton of sense. So, that was a little thing that helped quite a lot along the way.

[0:23:24.2] KH: I think another thing that really helped us was working with Tim Baker and the planning team at YFP. They were very much instrumental in guiding us through and helping us make the decisions. You know, I grew up putting my money under a mattress making sure it was nice and crisp and counting it every week. When we started this journey, Nate wasn’t financially savvy until 2016, when he got more into it after reading Rich Dad Poor Dad.

So, I think working together in having a third party objectively look at everything and give us some guidance was really helpful as well.

[0:23:55.9] TU: You don’t have to make Tim’s ego any bigger. No, I’m just kidding. I can see he is listening to that. So the question that I am begging to know the answer to is, you guys were throwing a huge amount of money at this debt. Obviously, at some point, you got that debt paid off and, all of a sudden, you’re not having to make that big of a payment anymore. I often think about this in the context of my journey and I often chalk it up to where did that money go.

Well, more kids, kids got expensive, other things come along the way, but I also know you guys have been really intentional as a family about what are we trying to do in terms of experiences and how we want to be intentional with the resources and the money that you have each month. So, Kristen, talk to us about this journey after the $250,000 of debt, where no longer making this massive monthly payment. What’s happening? What are we doing?

[0:24:43.5] KH: Well, we went to Disney World. I feel like that’s the most appropriate thing, you know? Honestly, in some parts, it feels like it hasn’t changed at all. We still have a lot of that mindset with being frugal and still saving for our future, but also trying to live in the moment, and we have done a lot of life planning as well and things that we want to do. I think we’re working on travelling more.

Like I said, we went to Disney, hopefully some other trips coming up, just being able to spend more time with the kids I think. People with children understand that the first five years before they start school is just hectic and overwhelming. We were just trying to take in all these moments before they head to school officially.

[0:25:20.1] TU: I love that. Right, it goes quick and everyone says that, but it’s real, and I think the intentionality around these experiences and making sure there’s the budget there to support those experiences and to be able to enjoy those moments along the way. Nate, you recently shared publically your decision to go from full-time to part-time work in your pharmacist role. So we’re going to officially call you a pseudo pharmacist now.

[0:25:41.7] NH: That’s fair.

[0:25:42.9] TU: How much of a factor was getting to this point of having this $250,000 of debt paid off, how much of a factor was that and being able to approach that decision and ultimately, feel confident in that decision.

[0:25:55.4] NH: Yeah, it was huge. I mean, I can’t say that when we stared off that was the plan but as we get closer, we realized that it was a possibility, and I looked at the timing and I looked at where we were at and I said, “Look, this is like the last summer before our oldest goes off to kindergarten and then it is just going to get crazier and crazier as time goes on” So I took a step back and said, “Now that this debt is gone, we really can take a step back.”

Kristen has been so supportive and helpful in allowing me to do that, but it’s been really cool because now I can just focus on them for the summer and those extra 20 hours that I found every single week is just, I’m on the kid’s schedule. Like the other day, it was raining in the morning and so we went to the movies and we saw a kid’s movie and then we got out and I was like, “Hey, it’s sunny. Let’s go to the playground” and so we did that.

It was just really cool to be on their schedule rather than some work schedule or something else that I had to do or had to get done. There wasn’t a timeframe anymore and that’s been really cool and again, without that debt being gone, there is no way we could have done that.

[0:26:51.3] TU: Yeah, what I love is I think both of you are such a great example. Where yes, you’ve got a PharmD, yes, you’ve got residency training, yes, you could continue to climb certainly in various clinical roles and there’s the opportunities always there and will be there, but you also have some opportunity for flexibility in those roles and I think sometimes we don’t think creatively enough as pharmacist about how we’re going to use our time each week, and that can change season to season.

I work with other pharmacists who went through a season with young family and others where they pivoted to part-time roles or more flexible schedules and then that changed the game at a later point in time. So I think there’s opportunities to make sure that we are coordinating our work plan with our life plan and with the financial plan as well. Kristen, I’ll start with you and then Nate, if you have other thoughts as well.

I’m someone listening who, maybe I’m a student, and I am like, “Oh my gosh, thanks so much I feel depressed about the journey ahead” or maybe I am in the middle of the debt repayment journey and I just feel like, “When does this going to end?” or I feel like I am spinning my wheels. What advice would you have for pharmacists that are in that debt repayment journey as they’re trying to really navigate that path forward?

[0:27:58.8] KH: Yeah. Not to sound cheesy, but I think a really big player, at least for me, was the YFP planning team. We felt like we had a plan but we weren’t really sure if it was a good plan, and really it was after I had our second child and I was listening to a lot of podcast. I was walking everyday on maternity leave and I was listening to podcast every time I would go for a walk and I was like, “We really need to look at this.”

I feel like we need a more set plan as to what we’re doing, especially since you’re at such an integral point of your life where you want to be able to spend extra time with the kids, but you also may feel like you can’t financially do that, and so I think having that, like I said, that objective third party look at what you two are talking about as a couple can be really, really helpful, and also helped us look at a lot of our other financial plan with the investments.

Like, can we get into more real estate investing, are we contributing enough to our 401(k)? Are we doing things that seem like we should be doing? I think that is really, really been a big impact on us on being able to achieve this.

[0:28:55.0] TU: Nate, any other words of wisdom, advice you’d have to folks that are kind of in the thick of it, if you will?

[0:29:00.6] NH: Yeah, I think for me, again, just for me at least, what were just this mindset shift away from being stuck at, “Okay, I only have—this is my income” right? “If I make a $110,000 a year as a pharmacist, that’s all I’ve got and there is no other opportunities and I have to make it work with that money.” I challenge everybody out there, and there’s a thousand and one different ways to do this, but you should find something where the more effort you put in, the more you get out of it, and it doesn’t have to be money, right?

That can be just time, that can be time with your family, that can be things that you enjoy doing, whatever that is, find something that is going to supplement your life that the more effort you put into it, the more reward you get out of it ,and that is just a really great way to set yourself up for success.

[0:29:40.9] TU: I love that. To reiterate what we talked about a little bit ago, the dollars are one piece of that, but don’t underestimate the momentum that comes from that as well, and that momentum is so important as it relates to the financial plan. You’re related to the debt repayment but I always stick to the other parts of the plan as well. Again guys, congratulations on knocking out this huge chunk of debt.

Really incredible to hear the story and the why behind it and how you’re able to do it, excited for what lies ahead of you guys and thanks for taking time to come on the show.

[0:30:10.5] NH: Thanks Tim, we appreciate it.

[0:30:11.6] KH: Thank you.

[END OF INTERVIEW]

[0:30:12.3] 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 it is not intended to provide and should not be relied on for investment or any other advice. Information of 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 post and podcast is not updated and may not be accurate at the time you listen to it on the podcast. Opinions and analysis 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 261: YFP Planning Case Study #2: Planning for Retirement, Saving for Kids’ College, and Paying Off Debt

Posted on June 23, 2022November 2, 2022 by yfpadmin

YFP Planning Case Study #2: Planning for Retirement, Saving for Kids’ College, and Paying Off Debt

On this episode, sponsored by Insuring Income, YFP Co-Founder & Director of Financial Planning, Tim Baker, CFP®, RLP® is joined by YFP Planning Lead Planners, Kelly Reddy-Heffner, CFP®, CSLP®, CDFA®, and Robert Lopez, CFP® to walk you through a financial planning case study on planning for retirement, saving for kids’ college, and paying off debt.

About Today’s Guests

Kelly Reddy-Heffner, CFP®, CSLP®, CDFA®

Kelly Reddy-Heffner, CFP®, CSLP®, CDFA® is a Lead Planner at YFP Planning. She enjoys time with her husband and two sons, riding her bike, running, and keeping after her pup ‘Fred Rogers.’ Kelly loves to cheer on her favorite team, plan travel, and ironically loves great food but does not enjoy cooking at all. She volunteers in her community as part of the Chambersburg Rotary. Kelly believes that there are no quick fixes to financial confidence, and no guarantees on investment returns, but there is value in seeking trusted advice to get where you want to go. Kelly’s mission is to help clients go confidently toward their happy place.

Robert Lopez, CFP®

Robert Lopez, CFP®, is a Lead Planner at YFP Planning. Along with his team members, Kimberly Bolton, CFP®, and Savannah Nichols, he helps YFP Planning clients on their financial journey to live their best lives. To go along with his CFP® designation, Robert has a B.S. in Finance and an M.S. in Family Financial Planning. Prior to his career in financial planning, Robert worked as an Explosive Ordnance Disposal Technician in the United States Air Force. Although no longer on active duty, he still participates as a member of the Air Force Reserves. When not working, Robert enjoys being outdoors, playing co-ed volleyball and kickball, catching a game of ultimate frisbee, or hiking with his wife Shirley, young son Spencer, and their dogs, Meeko and Willow.

Episode Summary

What are your retirement goals, and do your investments align with your vision of the future? Welcome to another episode of Your Financial Pharmacist Podcast. YFP Co-Founder & Director of Financial Planning, Tim Baker, CFP®, RLP® is joined by YFP Planning Lead Planners, Kelly Reddy-Heffner, CFP®, CSLP®, CDFA®, and Robert Lopez, CFP®, to walk you through a financial planning case study on planning for retirement, saving for kids’ college, and paying off debt. This is our second case study, and this time we hone in on the lives of a fictitious couple, Fiona and Rob Anderson. We examine their financial portfolios, from salaries and debt to their investment accounts and insurance policies. Listeners will learn about Rob and Fiona’s retirement goals and whether they have invested in the right ways to achieve them. The problem of conflicting goals rises to the surface, and Kelly and Robert share how you can manage to prioritize your children’s college education with your own retirement plan. Kelly and Robert touch on innovative ways to spend less on college while giving us invaluable advice on making your investments work for you. Delaying your retirement and waiting to claim your Social Security are helpful methods in ensuring cash flow during retirement. Finally, we get a glimpse at what paying a mortgage during retirement is like, and whether there is reason to panic.

Key Points From This Episode

Getting to know Fiona and Rob Anderson.
The home, work, and financial portfolios of our case study couple.
Fiona and Rob’s investment accounts and insurance policies.
Diving into tax concerns.
Your children’s education versus building your retirement fund – conflicting goals.
How to prioritize conflicting goals.
Some innovative ways to lower the costs of college/university.
How to use 401Ks, RSUs, and other investment accounts wisely, for investing in your goals.
Delaying retirement and waiting to claim Social Security.
A closer look at whether their particular investment accounts work for their specific goals.
Unpacking the target date fund and traditional IRA.
What to consider when paying a mortgage in retirement.
Your age concerning your debt, and if there is reason to panic.

Highlights

“You can take out loans for school, but you can’t take out loans for your own retirement. So make sure you take care of yourself first.” —Robert Lopez, CFP® [0:08:20]

“It’s really like golden handcuffs. It’s a way for a company to make sure that you’re not going to want to leave, ‘Hey, here’s this money, but you have to stay here to get it.’” — Robert Lopez, CFP® [0:18:25]

“Taking those dollars that you feel are being wasted and putting them towards something that you actually feel pain over, is huge.” — Robert Lopez, CFP® [0:21:00]

“Things happen unexpectedly. So, having your documents in place is important, and it makes it a lot simpler and less chaotic.” — Kelly Reddy-Heffner, CFP®, CSLP®, CDFA® [0:24:20]

“The emotional variable, I can’t calculate for.” —Robert Lopez, CFP® [0:32:12]

“‘Money is power.’ But money is not power. Options are power. Having the option to do different things, and having the ability to make different plans is powerful.” — Robert Lopez, CFP® [0:35:02]

“The best plan is one that works. As long as it works for them, then they made the right choice.” — Robert Lopez, CFP® [0:35:16]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[00:00:00] TB: You’re listening to the Your Financial Pharmacist podcast, a show all about inspiring you, the pharmacy professional, on your path towards achieving financial freedom. Hi, I’m Tim Baker, and we’re back with the Case Studies, this time with the Andersons. I sit down with YFP Planning’s Lead Planners, Kelly Reddy-Heffner and Robert Lopez, to walk through this fictitious family and their financial plan.

Although the Anderson’s are not an actual couple we work with, they are really a composite of clients that we do work with in reality. The first part of the discussion, we lay the groundwork of the Anderson’s jobs and salary situations, where they live. We walk through their net worth and point out important elements of their financial situation. We also talk about their goals and what they’re trying to achieve.

We then talk back and forth about their financial situation. One of the big focuses being on education versus retirement planning and how to best use their investments going forward. This is a bit of the behind the scenes look at what goes on at YFP Planning. I hope you enjoy this episode, but first, let’s hear from our sponsor and we’ll jump into the show.

[SPONSOR MESSAGE]

[00:00:58] ANNOUNCER: This week’s podcast episode is brought to you by Insuring Income. Insuring Income is your source for all things term-life insurance and own-occupation disability Insurance. Insuring Income has a relationship with America’s top rated term Life Insurance and Disability Insurance Company. So pharmacists like you can easily find the best solutions for your personal situation. To better serve you, Insuring Income reviews all applicable carriers in the marketplace for your desired coverage, supports clients in all 50 states and makes sure all of your questions get answered.

To get quotes and apply for term life or disability insurance, see sample contracts from disability carriers or learn more about these topics. Visit insuringincome.com/yourfinancialpharmacist. Again that’s insuringincome.com/yourfinancialpharmacist.

[EPISODE]

[00:01:50] TB: What’s up, everybody? Welcome back to YFP Planning, case study number two. The last time, if we remember our first case study, which I thought was smooth, looked at the Joneses. This time, we’re looking at YFP Planning case study number two, the Anderson’s. The Anderson’s that are a little bit different stage of life, but I’m excited to jump in with my colleagues Robert Lopez and Kelly Reddy-Heffner. Guys ,what’s going on? How are things going where you’re at?

[00:02:15] KRH: Good.

[00:02:16] RL: Yeah. It’s 105 today, so—

[00:02:19] TB: 105 in Phoenix. Kelly, you are, I’m sure, all in on this case study, not imagining sitting on the beach next week.

[00:02:26] KRH: That’s right. I am totally all in. Not distracted at all, but excited to talk through people in mid-stage.

[00:02:34] TB: Awesome. All good. So, Robert, same as last time. Why don’t you set up and, for those listening on the podcast, we are releasing these on video, so you should be able to see us talk through our one page overview of the Anderson’s. Robert is going to set us up in terms of salaries and things like that. Kelly is going to get into goals and debt, and then I’ll take us home, and then we’ll open it up for discussion and go from there. So, Robert, why don’t you take us away?

[00:02:58] RL: Yeah. So, today we’re working with Fiona and Roy Anderson. Fiona is Field Medical Director. She’s 46 years old, making $155,000 a year. Roy is a Pharmacy Manager, 48 years old, making 135. They’re married, filing jointly. They have two sons, Michael and Paul, aged 16 and 14 respectively. They live in Jersey City, New Jersey. Their gross income works out to about $290,000 a year, which breaks down to around $24,000 monthly. Their net, or what they actually receive in their bank accounts, is about $12,000 a month. Their fixed expenses are $6,300, variable expenses of $2,200, and then about $3,300 of monthly savings. They live and own a three bedroom, a single family house. They purchased in 2008, which they got for $420,000 using a conventional 20 percent down at a 6 percent interest rate. Then, in 2015, they’re able to refinance to a 4 percent, 30 year fixed mortgage.

[00:03:56] KRH: Then they have a few goals that they want to accomplish while we’re working together, hypothetically. They want to pay for the four years of undergrad for Michael and Paul. They are making 529 contributions, which they recently increased. They have a pretty robust amount in the account baseline. They want to know if they’ll have enough to accomplish that. Concurrently, they want to try to retire in the next ten to 15 years. One thing to consider is, with the home that they currently own, they want to downsize and move to Florida. Then they are concerned about some of the debt that they still have, as well. So, that debt is listed out as a home equity line of credit that has a 5 percent interest rate.

They remodeled their kitchen and are paying $1,000 a month on that. They still have car loans. They pay a total of 750 interest rates between 3.5 and 4.25 when the two car notes. They still have their own student loans, which is always an interesting intersection with paying your own children’s college tuition as well. They refinance to a ten year private loan, 4.25 percent five years ago. Then, of course, they have the mortgage. So it’s a 30 year fixed 4 percent interest rate after that refi. They’re seven years in and they’re paying 2,500 a month.

[00:05:21] TB: Then, from the wealth building side, they have some cash in the bank, $20 grand in checking, $50 grand in savings, but in terms of their investments they’re looking at 401K, so they both currently have 401K that they’re contributing 4 percent each, plus a 4 percent employer match, so basically 8 percent in total. They’re both invested in the 2035 target date funds. Fiona has an old 401K, a small one at $15,000 that she hasn’t really looked at. They do have a 529 account that they’re increased their contributions lately to $1,0LL, so $500 for each son, so $12,000 a year to get to that goal. Unfortunately, they don’t get an income tax deduction, because in New Jersey if you make more than $200,000 it’s off the table.

They do have a taxable account which is basically Fiona’s RSU, so stock units as part of her compensation, which we see in a lot of Industry Pharmacists. We’ll get that as part of their comp. She has $125,000 that it’s currently sitting in there, all in the company stock, and then they have a joint savings account that they’re putting a hundred bucks a month in, to consider the rainy day.

Michael graduation trip, when you graduate high school, and then a traditional IRA that they’re funding for Fiona in a balanced fund. That is basically their investment accounts. Roy also has a Roth IRA that has about $36,000 in it that he’s not contributing to. It’s sitting there presently.

From a wealth protection, so this is typically where we talk about insurance, in a state, they each have a 20 year term, $1 million policy that they purchased five years ago, plus a little bit of group life insurance that basically matches their salaries, $150,000, $135,000 respectively. They both have short term and long term disability which has a benefit of 60 percent. That’s going occupation for two years, then any act after that. Roy carries his own professional liability policy. Then, they have a will that was done when Michael was born, so basically 15, 16 years ago. A living will or trust, power of attorney that needs to be updated.

From a tax perspective, they currently use an accountant, but they’re not sure they’re maximizing their deductions. They recognize that New Jersey state income tax and property taxes are killing them, which is why a lot of people from New Jersey moved to Florida. It’s not as bad. They typically owe taxes every year, so they’re basically reached in their pocket for that. One of the big tax concerns they have is that with Fiona’s RSUs, they’re worried about capital gains on that and not really sure what to use that for.

Some other things are conflicted about how much to put towards college versus their own retirement. Can they retire in 15 years? In retirement, they’re really looking to up their travel game a little bit more. So I guess, I’ll pose the question to the group here when you guys look at the Anderson’s, Fiona and Roy, what are some major things that stick out to you when you’re approaching them in terms of their financial plan?

[00:08:08] RL: Yeah. The first two goals that they have are conflicting here. So they want to pay for education for the boys, but they also want to make sure they’re setting themselves up for retirement. One of the phrases that you’ll hear a lot through financial conversations is, “You can take out loans for school, but you can’t take out loans for your own retirement. So make sure you take care of yourself first.” I think they’ve done a really good job with that so far. They’ve saved a lot in their 401K. They’ve set aside money for the boys at the same time, but now it’s really deciding on how to be important about that and how to be decisive.

The 4 percent that they’re doing into their retirement accounts, plus 4 percent of a match is good, but not where we’d like to be. Ideally, we want to meet at least 10 percent, and I think there are going to be some ways that we can get them to that point. I think that their savings in their 529, right now, is aggressive at $1,000 a month. That’s a pretty big chunk of their cash flow. I think that that’s actually going to be enough, depending on some scenarios we may discuss. But really deciding is the order that they gave it to us, to correct order that they have. Is the boy’s education more important than their own retirement? Are they willing to accept the opportunity cost or the change that would require? They may need to work longer to send the boys to college, and really flushing that out.

[00:09:14] TB: I think one of the things that is interesting about this case, because we hear it for a lot of new practitioners, is the age old question of, should I pay down my debt, i.e., my student loans or should I get going on my retirement, my investments? There’s that push and pull that I don’t think really ever goes away, because there’s just different things that are always competing against that berm investment game. So when you look at this, how would you walk them through or walk them down the path of getting down to the granular bits and pieces of the retirement versus the education? Is that something that you would look to model out? Is it really asking more clarifying questions with regard to their goals? Walk me through your thought process there.

[00:10:03] KRH: Sure. I agree with Robert that those are conflicting. So, talking through what’s important when individuals have their own student loan debt, they really do tend to lean towards creating scenarios where that doesn’t exist for their own children. We do a high level nest egg that popping some numbers in, based on this case study, they probably wouldn’t be able to retire in ten years, based on these numbers. So, Robert is correct about that, too. More contribution would be better. As far as the education, we can model out and take a look. Certain schools are going to be more cost effective. There are other things that students can do. Good grades. Robert gives a great talk on collect exams, which I love. My own children have listened to some of the conversation.

There are ways to make college funding more affordable and have those conversations. The kids are at an age at, especially at 16, really to start the conversation about what’s affordable, what makes the most sense, and the parents, setting some boundaries on what they’re comfortable with to not sacrifice their own retirement goals. Yeah, a combination of modeling would definitely answer some of the questions about that expected cost in the future, how much they’re going to be able to cover. What the shortfall is. Then I think Robert’s right too, about finding a better balance with the goals and how to prioritize them.

[00:11:40] TB: Robert, can you give us the cliff notes on the CLEP thing? Because I think that’s actually pretty powerful, if you’re a pharmacist that’s listening and then you have kids that are high school age looking at colleges. This is something that I think [inaudible 00:11:50].

[00:11:54] RL: Yeah, Tim. One of the big things that we like to talk about with clients is not necessarily just saving for college, but also ways to save on college and education expenses. There are a ton of ways to do that, whether it’s planning to go to a community college for the first couple of years or it’s maybe just ignoring traditional education and going to our trade schools. But one of the ways I like to do it is just getting credits out of the way, and everyone understands dual enrollment credits and everyone talks about AP courses, where they can test out of college classes, but a CLEP, a C-L-E-P is run by the College Board. It’s the same people that create the SAT.

What it is? Is it’s a test where you can sit down. Take a one-time test where it costs about 90 bucks on a bunch of general education classes. If they pass that course, then they get to skip it in college, they get automatic credits that will be accepted at the majority of universities. Now, every university in college has their own rubric that they request, and they say, “Hey, you have to get at least 65 on this class for it to count. They only accept these five classes. 65 different CLEPs, that different college will accept.

If you’re a math major and you don’t want to take English classes, take these two tests while you’re in high school, when you just learn English and never have to take it in college. Or if you’re an English major who doesn’t want to take mathematics, when you take a mathematics and high school that’s practicing for the test, you take a CLEP, you pass it, you never have to take it in college again. It’s a great way to either get a head start on college or get through the classes that are going to slow you down, and allow you due to the coursework that actually excites you and makes you want to go to college, rather than slogging through the first two years of Gen Ed before you can get to the stuff that you care about.

[00:13:20] TB: Yeah, I think it’s now really important to highlight all the tools that are available for students and parents to make a good decision. I feel like, if I get in the time machine and go back to when I was looking at schools, I didn’t have any. And I think because—I would have done very foolish things back in the day. I think that if there are things that we can do, whether scholarships or things like Test NL, going to put the price tag a little bit more affordable. I think probably one of the things that I would want to model out and what’s interesting about the Anderson’s is that they have a goal in place.

A lot of people, especially, I think if they have young kids, will ask, “What’s the goal for sending your kids to college?” It’s like, “I don’t know.” That’s what we talk about the one third rule, which we’ve talked about at length, where you can pay—basically the idea is that what you’re putting in 529 is one source of the tuition, and then another source would be when your child is 17 or 18 going into college, you’re basically paying that out of your paychecks, you’re sending a check to the college. Then the last third would be the scholarships and the student loans. Last but not least. We use that as a default, that there’s no idea what they want to do. With Fiona and Roy, the idea is put them through four years of undergrad.

Kelly, we know that not all schools are created equal, right? Whether they go to somewhere like Rutgers, which is in the state in New Jersey or somewhere like The University of Miami, which is a private school out of state in Florida, how do you advise parents to talk to their kids or just approach this with their kids, in terms of sensible decisions with regard—I know it’s hard at 17, 18 year old to go about approaching that question.

[00:15:07] KRH: Well, definitely when we started that conversation, it was talking about what our budget was, what we were going to be able to contribute. Then, looking when we would look up schools, understanding what the tuition is. There’s a number that pops up a lot on schools or websites. That’s an average cost, unfortunately, depending on your income and for many of our clients. That income is not going to reflect what that average cost is. So the average cost assumes 100 percent paid for, in some scenarios, all the way up to paying the full price tag. It’s really good to understand what your cost is likely to be, and at this income level for Fiona and Roy, it’s probably not a whole lot of financial aid.

I would assume no financial aid based on need. I do recommend having an understanding of what your cost might be. What schools are going to give those scholarships? There are certain schools that only give financial based need aid. There are schools that give grants for being a tuba player, the football player, great academics. So knowing your skills, what your talents are in a range. I would agree, we mentioned, Rutgers, a state school is going to be different than Princeton. What does that look like between the two? But I think people also discount private schools, and just seeing some of those schools have pretty nice endowment and a little better package. I would say I’d look at a nice handful.

We sometimes see kids are applying to 30 schools. You’re busting your budget, just on application fees. So, pick a few that makes sense. Have a few you can compare apples to apples, oranges to oranges and be like—you’re really looking for the best package and the best fit that’s financially viable for you and the student borrower, who’s going to take on any debt that you all can’t pay for if the savings is at capacity.

[00:17:14] TB: Yeah, I agree. I think one of the wildcards in this whole situation is we look at the taxable account. So, I don’t think I broke down what they have in their 401K. But Fiona has a 425 plus another 15 in an old 401K, Roy has 459. Then they have 365 and a Roth IRA and 195 – Ira. I think the wild card Robert, in this whole scenario in terms of the planning is what to do with the RSUs. These are a weird, because it’s compensation that comes in the form of stock that can grow over time. I’m a big proponent of like, “Okay, let’s tie this to something.” So, is this something that is for retirement? Is this something that they could apply towards the debt, towards the education? What’s your thought with regard to—how would you approach it? How to utilize that for the goals that the Andersons have?

[00:18:08] RL: Yeah. So restricted stock units, for those who aren’t aware, are a form of compensation when a company gives you stock, but you have to invest into it, right? Generally it comes in with the grant where it says, “Hey, you’re going to get this many shares.” Then, you’ll get a portion of it every year or quarter or month depending on the policy. It’s really like golden handcuffs. It’s a way for a company to make sure that you’re not going to want to leave. “Hey, here’s this money, but you have to stay here to get it.” Yeah, you may want to leave, but you have some invested RSU grants that you’re not going to be able to get if you leave right now. So you should probably just stay with us.

One of the things that I like to make sure clients understand is that these RSUs are just income, right? It’s taxed as income when you get it and you need to treat it as such. Although it looks like this big shiny object that we have to save and grow forever, it is just income and we can use it as such. So when we look at them, their big goals are, “Hey, I want to pay for college. Hey, I want to make sure we retire. Hey, I want to have less debt.” We want to help them, again, rack and stack those goals where sure, if we need that money for college, then it’s there, right? But if we can find out a plan for college, “Okay, cool. Let’s check that off, the boys understand what we have for them. The boys are going to come up with their own plan and it’s going to be financially settled.”

Okay, retirement. How can we use this money toward retirement? We could reorganize our cash flow, when we’re actually cashing out. Some of these are issues which would allow us to put more away in our retirement buckets. That’s a great way to use it. Another way is to solve that fourth goal. These are issues again. It’s just a taxable investment account. We have an unknown what the capital gains are, so we’re not sure, in this scenario, exactly how much of that is the grant itself and how much that is gained.

There will be some tax complications of this plan, but the $125,000 could, in reality, pay off all of their debt other than the mortgage. We can pay off the HELOC, which is $43,000 at 5 percent. We could pay off the cars at 3.5 and 4.5 percent. We could pay off the student loans at 4.5 percent. Then all they would have left is the mortgage that would free up $2,300 in cash flow on a monthly basis—

[00:20:04] TB: It is huge.

[00:20:05] RL: That’s huge, that’s a huge amount of money, okay. That could then turn around and immediately go towards extra savings, extra travel budget for that graduation trip they want to take in two years, extra 401K contributions. Right now, they’re doing 4 percent plus a 4 percent match. We could easily get that to ten or 12 percent without changing their life at all, only by reallocating those RSU dollars that are just sitting in a holding to this thing. We also know that she’s getting more RSUs, so this isn’t the end of her getting company stock. She’s going to get those refreshed, which is what happens when you get a new grant all the time. So as long as she’s still working, those grants are going to keep coming. We just want to make sure we’re using them appropriately.

They’re just sitting there, maybe they’re growing, they’re doing phenomenally, maybe they’re going down. We got to check the company trajectory, but using that to solve an immediate goal, like get out of debt and save for retirement would be a huge lift on somebody’s spirit. Having done that with clients in the past, taking those dollars that you feel are being wasted and putting them to something that you actually feel pain over, is huge.

[00:21:05] TB: Yeah. I think one of the things that I would want to unpack. I love all of the different avenues to go, potential pot of money, the RSUs, which is, like you said, another form of compensation. I think the other thing that I would really want to impact with the two of them is to retire in the next ten, 15 years. Is it closer to ten? Is it closer to 15? One of the things that’s going through my RICP coursework that I just thought was astounding was delaying retirement by three to six months is the equivalent of saving 1 percent more for the course of your 30 year career.

Another way to look at is delaying retirement by one month is the equivalent of saving 1 percent more for the final ten years before retirement. One of the big things that I think people get wrong in retirement is when to claim Social Security. Obviously, if you can delay that, you have an income stream for life that follows inflation that’s super valuable. So, are there ways to potentially increase that retirement paycheck? Now, they could look us and we know that this is true, guys. In pharmacies, I only got ten more years left. I’m burning out, I’m not good. Maybe there is the ability to work part time or things like that.

I think to Robert, to your point, being able to model out and move those pieces around to say, “We could use this pot of money and clear all that debt that frees up that cash” is a beautiful thing. But they could also say, “We feel bullish on the company that we want to let it ride and we won’t have the certainty there of cashing out and retiring those debts. Maybe we’ll let it ride for greater upside, but we know that there’s risk there as well.” Super fascinating. The nice thing about this is there are pieces to move here and there’s different scenarios to run. I guess, one question I would have with regard to the protection of the plan. Kelly, what are some things where their insurance related or a state plan and related that you see has some areas of exposure for them?

[00:22:59] KRH: I mean, in general, the insurance looks pretty good. The term 20 years, they just purchased it five years ago. So they’re going to get the kids through college. I know we had talked about this the last time. What amounts make sense of the disability policies? The amount looks reasonable with the 60 percent of income replaced. I would say the own-occupation for two years is a little bit of a question mark or sometimes we see the policies follow an income amount. So is it the income amount? Or is it that owning your own or any occupation? That’s probably something, I’d look at a little further, because we know just with the actuarial data that that can be a bigger problem than [inaudible 00:23:42]. But things look reasonable.

I would say, I would get the estate planning documents updated. So I would get the will double checked and updated, some other things probably have changed, as well over the last six years. I am a fan of having advanced medical directives in place, in terms of retirement. I think one of the statistics in our slide deck is that things happen sooner than we think they might happen at times. On the positive side, if you have an opportunity to retire, great. But sometimes health events, issues, things happen unexpectedly. So having your documents in place is important, and it makes it a lot simpler and less chaotic, especially at this phase. The kids aren’t really old enough to be making decisions, so you do still need to have things in place for sure.

[00:24:38] TB: Yeah. I think obviously that’s one of the often overlooked parts of the financial plan. Unless you’re military, where they force you to do wills and things like that, that’s where you typically see it more frequently. But just making sure that that’s buttoned up and there’s a plan in place for that. I think the other thing that I would probably circle back on. Robert, I would love to hear your thoughts on, is just the overall allocation. Do you think l balance funds—I see that we’re funding the traditional IRA, which see— were in 2035 target date funds, which are in that time frame. Ten to 15 years is still a pretty long time to go, so I’d want to dig deeper into that in terms of what they’re actually invested in.

We know, as we talked over at length in the past, that the allocation console of a lot of things, because if you’re looking at ten years, 20 years-time, typically the stock market, will take care of you. So, how would you look at their investments, particularly with the traditional IRA and maybe some of the allocations that you’re seeing?

[00:25:35] KRH: Yeah. One of the things on the traditional IRA that we need to double check on is, how are these dollars even going in there? Based on the fact that she has a 401K and they make so much money, shouldn’t be qualified for deductible contributions. So we want to make sure that these contributions have been going in undeductable, that they’re not trying to take a deduction on it. Beyond that, having them in a balanced fund doesn’t sound bad.

Most people in the world will believe that balanced means 50/50, but in the finance world it means 60/40, because why would we make sense? So a 60/40 fund on that account isn’t terrible for their age range, but it’s probably a little conservative. To go along with that, the target date 2035 funds, which are just mutual funds aged for a use at 2035, so they decrease in risk over time. Those are probably about the same right now, so about 60/40 at this point in time. I think that that should be probably extended. If they’re going to stay at a target date fund which is not necessarily a bad thing, I’d probably want to extend it closer to that 2045 timeframe to line up more with a normalized retirement.

You don’t actually aim for the year you’re planning to retire. It’s more so you aim for 65 and then that stretches out over your lifetime. It’ll never go to 0 percent investments. It’ll always have something in the market, because if we’re going to live to 100, we can’t just put it all into cash the day we retire. We need to have some risk in there. I think they still need to have a little bit more risk going on. So we want to look at what options they have, what the fees are, what the expenses are, how complex we can make it, but at the very minimum, I’d to maybe take that up to about 80/20 from a risk perspective. We obviously talk to them and make sure that they’re comfortable with that amount, but with their current time horizon, I think that that would still work.

[00:27:10] TB: Yeah, I think it’s asking a clarifying question and maybe digging into – because I think, even all target date funds in this, they aren’t created the same. There’s different allocations that are associated, depending on the year. I think the other thing that I would probably want to look at, just to make sure, is that you could have a balanced fund for the 529, which might be good for Michael’s accounts, but maybe not for Paul’s. Maybe it is Paul’s 14, so he has a couple more years, maybe just looking at that.

As Michael is going to college, we’re not overexposed in equities and we see a crash and then not as much dollars are there. One question, and then we wrap this up, guys. I think one question that I would ask related to the mortgage. They’re 46 and 48, respectively. Based on their refi that happened after what was that? That was in 2015, so we’ll say seven years ago, they had 23 years left on the mortgage.

Kelly, you recently relocated, so maybe get your take on this. Your thoughts on you—whenever says like, we have too much debt. I think Robert did an excellent job of outlining the path, or basically, we can redeploy some of the assets to basically wipe all the debt out, except for the mortgage. My question is this. If I’m mid to late 40s, or 50s, and I have a mortgage that’s going to take me well beyond retirement age, should I be freaking out about that, or what’s your thought? How do you talk clients off the bar to that part?

Because of debt, obviously, this is something that can be a detriment to your retirement paycheck in the future. Walk me through what you guys think in terms of that. It’s like, now I’m 46, I’m 48, we have 23 years left in the mortgage, or that [inaudible 00:28:54].

[00:28:56] KRH: Oh, my gosh. I love this question, because I think it really could be all over the place. I think, well, I feel like, there could be a point-counterpoint, point-counterpoint about this. It is interesting. Off the top of my head, when we do the nest egg, we’re like, okay, the wage replacement ratio, 70 percent of what you’re living on now, because you’re debt-free, you’re not paying into retirement. They’ve said that they want to move. It will be interesting to see if you are downsizing and you’re going to sell the house. Anyhow, that current mortgage debt is not going to be as big of an issue.

I would say, if they’re not moving, ideally, you’d probably like to see it paid off, but it really does come down to cash flow. When we run modeling and looking at retirement and potential for success to reach a very pleasant age of 95, or a 100 and still have resources, it really always comes down to cash flow and budget. What you’re living on per year has a big impact on that. Is the mortgage affordable to make the plan work? It really does depend. It would go in the modeling and scenarios and again, comfort.

I guess, I would lean towards wanting the debt paid off if I wasn’t moving before retirement. Then, we just have that conversation in my house and my spouse is like, “I could live with pain for a couple years, and then we sell it, and we become expats on a Caribbean island.”

It depends, but I do think it does a little bit. Wherever they go with it, Robert, I will love to hear what you add in, too. Before I turn it over to Robert, I would say, too, the other thing about wealth protection, at this stage, this is often when our parents are having stuff going on, too, if their parents are still alive and they have a relationship with some understanding about that. That relationship, hope and expectation is definitely a key part of protection. I’m often surprised at what an overwhelming time that can be. The kids are in college, but the parents have some type of health issue, and that can be stressful as well.

[00:31:20] TB: Which is important to bring up, because it’s not necessarily that Fiona or Roy’s parents would be our clients, but their parents situation can affect the financial plan of our clients. It’s good to get in front of that before—have those hard conversations about who is doing what or providing care, or if they have policies that not left the—cover down on that. Yeah, that’s a huge important point. How about you, Robert, in terms of the debt? 23 years left. I’m in my mid to late 40s. Should I be freaking out about that, or is it depends?

[00:31:51] RL: Specifically for the mortgage, I think, to Kelly’s point there, that two of them in our own household have different vibes on that. That’s one of the key things when we’re talking about this with clients is, mathematically, I can tell you the right answer. Mathematically, it’s interest rate arbitrage. We’re paying 4 percent of the mortgage. We can get 8.50 percent, 80-20 portfolio. We should just put it in the retirement accounts. The emotional variable, I can’t calculate for.

If someone has a money script that tells them that they have to have no mortgage when they retire, because they saw their parents or their grandparents have issues in their life because they had a mortgage tying them down, then that’s something we have to attack. If they’re going to downsize, doesn’t necessarily mean that their mortgage is going to go down. In Florida, are they going to leave a single-family home in New Jersey and move to a very swanky condo, 50s plus condo in Florida where they’re playing shuffleboard with movie stars? Maybe they’re going to be paying more even with less space. Those are some things to work out.

Having that conversation of 4 percent interest rate, although it may have sounded extremely large a year and a half ago, or even six months ago, is really a good rate historically. It’s not going to be the end of the world. It’s a securitized debt, so it’s tied to their house. I would be more worried about the other loans.

[00:33:05] TB: I was going to say the same thing. Probably, even the student loans that have probably just been kicked down the road a bit, I would almost—and this is probably an emotional thing, because I’m sure the—well, we said that the student loans are four and a quarter. Then not much more. I think, and this is more an emotional thing, this is a bias of mine, I’m like, “Let’s retire those loans before we start sending Michael to school,” would be my thought.

It’s a great point is, what is the plan in the future? It’s that arbitrage. Do we emotionally make that extra payment on a 4 percent mortgage, which historically over a 30-year mortgage reduces that by seven years, if you pay that extra payment, or do you put that extra payment more towards the retirement, get a better rate of return over the long-term and secure that?

I don’t know. That’s also another thing that, as Kelly mentioned, in her household, it’s different. It’s different in our household, too. I don’t think it really even registers with, where I’m I in my mind want to have the mortgage paid off as I retire, which in my mind is 70, but I could lose my marbles before that and have to retire sooner. That could be a thing. That’s another thing that people sometimes discount, is that you’re not always in control of when you actually retire, either because of career stuff, or health stuff.

Yeah. I think these are fascinating questions that we’re talking about this on a vacuum, but really go back and ask Fiona, ask Roy, the fake clients that we’re talking about, some clarifying questions about the debt, about the investments, the education and with the retirement picture, I think would be really important to then proceed with the plan.

Again, as we always say, it’s not about necessarily the plan. It’s about planning, because we know the next time we talk, there’s going to be a wrench in the system that’s going to potentially have a zig and zag as we get further along the plan. Guys, anything else to add?

[00:34:52] KRH: No.

[00:34:51] RL: No. I think they’re in a great spot. I think that Fiona and Roy have done a really good job of setting themselves up for success. People always like to say, and I use this phrase all the time, “Money is power.” But money is not power. Options are power. Having the option to do different things, and having the ability to make different plans is powerful. They have put themselves in a place where they have a lot of options going forward, and they can choose what they believe is the best path. The best plan is one that works. As long as it works for them, then they made the right choice.

[00:35:19] TB: Totally agree.

[00:35:20] KRH: If they use the RSUs to buy an RV, we’ll see.

[00:35:24] TB: Don’t do it. Don’t do it. I was talking to the team last night, on our happy hour, that I said $800 RV. It’s actually $1,100. Yeah, they’re a money pit All right. Robert, Kelly, thanks again for talking about the Andersons on our case study here. Looking forward to doing the next one here, in the next couple of months. Yeah, we’ll do it again soon.

[00:35:45] RL: Toodles.

[MESSAGE]

[00:35:47] ANNOUNCER: Before we wrap up today’s show, let’s hear an important message from our sponsor, Insuring Income. If you are in the market to add own-occupation disability insurance, term-life insurance or both, Insuring Income would love to be a resource. Insuring Income has relationships with all of the high-quality disability insurance and life insurance carriers you should be considering, and can help you design coverage to best protect you and your family.

Head over to insuringincome.com/yourfinancialpharmacist, or click on their link in the show notes to request quotes, ask a question, or start down your own path of learning more about this necessary protection.

[DISCLAIMER]

[00:36:23] ANNOUNCER: 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 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.

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YFP 260: Why It’s Critical for Women to Take Control of Their Personal Finances

Posted on June 16, 2022November 2, 2022 by yfpadmin

Why It’s Critical for Women to Take Control of Their Personal Finances

On this episode, sponsored by APhA, Robin Hauser, an award-winning director and producer, talks about her most recent documentary, $avvy, which explores why it’s critical for women to understand and take control of their personal finances.

About Today’s Guest

Robin Hauser is the award-winning director and producer of documentaries (CODE: Debugging the Gender Gap, Bias, $avvy, Running for Jim) made to illuminate causes about which she is passionate. Those include the gender gap in tech, unconscious bias, equality, and financial savviness. Robin’s work has carried her around the world, from the TED and TEDx stage to the White House, NASA’s Kennedy Space Center, and conferences worldwide, speaking about mitigating bias in artificial intelligence, the likability dilemma, diversity, inclusion, financial wellness, and gender equality. A self-described “disruptor,” Robin is committed to provoking thought to address the most important socio-economic issues we face today.

Episode Summary

There is an antiquated stereotype that women are ill-equipped to deal with the complexities of finance, but did you know that women outperform men when it comes to investing? In today’s episode of the Your Financial Pharmacist podcast, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, is joined by award-winning director and producer, Robin Hauser. In connection with her most recent documentary, $avvy, Robin walks us through the gender-based stereotypes surrounding finances while giving us her lived experiences of unconscious bias. Robin shares her motivation and inspiration $avvy and why it is an important work for people to view. The $avvy documentary addresses why women often take a passive role or give up their role in managing their finances, particularly millennial women. We dive into the different responsibilities men and women have concerning the financial planning of their households. Robin then highlights some of the obstacles facing women who want to take control of their finances—surprisingly, age is a noticeable factor. The conversation takes us through the confidence gap, and Robin states the importance of financial literacy education and instruction from an early age. Listeners will learn all about the pain of paying and the reasons behind financial education being a male-dominated space.

Key Points From This Episode

Robin’s real-world example of unconscious bias.
The gender-based stereotypes surrounding finances.
How day-to-day and long-term financial planning responsibilities differ in a household.
Why a woman’s lifespan is an important consideration.
The biggest obstacles facing women who want to take control of their finances.
How women outperform men when it comes to investing.
The psychology of confidence.
Negotiation and gender perception.
When financial literacy should be taught to women, men, and teenagers.
The pain of paying.
Why it’s mostly men who are the educators of financial literacy.

Highlights

“‘You do know that women have pocketbooks too, right? Women can buy condos or can join a timeshare.’ It was as though it never occurred to him. Poor guy.” — Robin Hauser [0:04:31]

“It just really struck me that they were missing this entire demographic by not actually approaching women.” — Robin Hauser [0:05:00]

“The reality is that we all take on a lot. So we need to divide and conquer at times, to be most efficient.” — Robin Hauser [0:08:05]

“We live longer than men. Even if you live a full life, chances are that a woman’s going to live eight years at the end of her life on her own.” — Robin Hauser [0:08:33]

“90% of women who are widowed or divorced changed financial planners or advisors within the first year.” — Robin Hauser [0:11:09]

“Because of women’s patience and their sensibilities to risk, they tend to make better investment decisions.” — Robin Hauser [0:13:13]

“We violate societal norms of what it is to be a likable woman when we are negotiating hard for ourselves.” — Robin Hauser [0:16:54]

“There’s no reason that you can’t learn in high school the positive and negative impacts of compounding interest.” — Robin Hauser [0:20:00]

“When you take two things that tend to have the stereotype to be very male-centric, I think it stands to reason that there are less women there.” — Robin Hauser [0:26:40]

“I do think that it’s hard to be what you can’t see.” — Robin Hauser [0:27:18]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[00:00:00] TU: Hey, everybody, Tim Ulbrich here. 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 sitting down with award-winning director and producer, Robin Hauser, to talk about her most recent documentary, Savvy, which explores why it’s critical for women to understand and take control of their personal finances. During the show, we discuss the main obstacles for women to take control of their finances, why women typically outperform men with investing, and why negotiation skills are essential for women to embrace as it relates to the financial plan.

Before we hear from today’s sponsor and then 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 50 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 financial planning services are a good fit for you, know that we appreciate your support of this podcast and our mission to help pharmacies achieve financial freedom. Okay, let’s jump into my interview with Robin Hauser.

[INTERVIEW]

[00:01:17] TU: Today’s episode of the Your Financial Pharmacist podcast is brought to you by the American Pharmacists Association. APHA has partnered with your financial pharmacies to deliver personalized financial education benefits for APHA members. Throughout the year, APHA will be hosting a number of exclusive webinars covering topics like student loan debt, payoff strategies, home buying, investing, insurance needs and much more. Join APHA now to gain premier access to these educational resources and to receive discounts on YFP products and services. You can join the APHA at a 25 percent discount by visiting pharmacies.com/join and using the coupon code YFP. Again that’s pharmacist.com/join and using the coupon code YFP.

Well, I’m really excited to welcome on this week’s podcast, Robin Hauser, who’s the award-winning director and producer of documentaries CODE: Debugging the Gender Gap, Bias, Savvy, Running for Jim, made to illuminate causes about which she is passionate. Those include the gender gap in tech, unconscious bias, equality and financial savviness. Robin’s work has carried her around the world, from the TED and TEDx stage to the White House, NASA’s Kennedy Space Center, and conferences worldwide, speaking about mitigating bias in artificial intelligence, The Likability Dilemma, Diversity Inclusion, Financial Wellness and Gender Equality. A self-described disruptor, Robin is committed to provoking thought to address the most important socio-economic issues that we face today. Robin, welcome to the YFP podcast.

[00:02:50] RH: Thanks, Tim. I’m happy to be here.

[00:02:52] TU: I’m really excited to have you on the show and to dig into the documentary that you helped produce, Savvy. This came from a friend of mine who let me know about the documentary. I’m so glad that she did, because I think it’s going to be an incredible resource for the YFP community and, of course, for pharmacists and others even beyond. I want to start with a story, Robin, that you shared in your 2019 TED talk (that we’ll link to in the show notes). That TED talk was called, “The Likability Dilemma for Women Leaders.”

You share a story when you’re on the ski resort and a man approached you and asked you if you’re with a husband or a fiancée. You said, “No” and started to head back toward the lift, and your curiosity got the better part of you and you decided that you were going to follow up and have a conversation. Take us there and tell us what happened at that moment.

[00:03:43] RH: Right. This is such a good example to me of unconscious bias, right? I’m walking through the ski resort. I’ve got a pair of skis on my shoulder. This man, he was young, probably late twenties/early thirties, just came up to me and said, “Hey, excuse me, are you with a fiancée or a husband?” I said, “No.” He said, “Oh, okay.” Sort of like, okay, never mind. So I kept walking and I thought, this is—wait. I’ve got to find out why he asked me that. I turned around and walked back to him and I said, “Hey, I’m just curious. Just wondering why you asked me if I was with a man?” He said, “Oh, because we’re selling timeshares.” That gave me pause. Then I looked at him and I said, “So you don’t sell to women?” He said, “Oh, yeah, oh, yeah. Well, we could. Yeah. Are you interested?” I said, “Well, no, not really.” I said, “You do know that women have pocketbooks too, right? Women can buy condos or can join a timeshare.”

It was as though it never occurred to him. Poor guy, he’s just trying to do his job. But I think that it’s the way they trained him. to go for probably the average (which is fine) couples that are together, heterosexual couples, and ask the guy, because, usually, it’s the man handling the purse strings and making long term or investment decisions. It just really struck me that they were missing this entire demographic by not actually approaching women.

[00:05:09] TU: You shared another story in that same TEDx talk where you had a cocktail party and you asked the man about his line of business, and he said he was in the fintech business. You said, “What type?” He said, “Well, it’s complicated.” I think it’s just another example of what you just mentioned there. My question for you is, why do women often carry this implicit bias that women don’t understand finance or they’re not involved in the finances? Where does that come from?

[00:05:33] RH: Well, and I just want to point out that these are, likely, very well-intended men. When this man said to me, “Oh, it’s complicated,” he did definitely say it in a dismissive way. What I was curious about is, had I been a man, how he said that to me. Would he still have said, “Oh, it’s complicated?” Or would he have said, “Well, actually, we’re a white bank and we’re raising 10 million for a first fund” or whatever, and gone into details about it. But he just assumed—and maybe it’s because I’m a woman, maybe because I’m blond. I don’t know—but he just made this assumption that it would be probably too complicated. Then, my response to him was, “Try me. You might be surprised. I actually might be able to understand you and the concept of whatever your fintech deal is.”

A lot of it is stereotypes. I mean, it’s really interesting that in our society—our society dictates that finance is male territory. If you look back over the years, that’s how it’s been. So, even if a woman handles the lunch money or the day-to-day grocery money, it doesn’t mean that she’s involved in long term financial planning. It doesn’t mean that she’s necessarily involved in, how much are you saving? Who’s your mortgage with? What debt do you even have? I mean, these are questions you might not be able to answer.

[00:06:49] TU: Yeah. Just the point of vulnerability here for a moment. My wife and I had this conversation not too long ago, where just what you said there—my wife stays home. We’ve got four boys, just phase of life we’re in. She, day-to-day, is spending money on the groceries, activities, home schooling things. She has a much closer look on the financials day-to-day than I do. But long-term planning, I was really taking a lot of that under my wing. We really identified this disconnect between the long-term planning and what was happening day-to-day. We said, “Really, if anything you should be in charge and empowered in the financial plan. Obviously, we both need to be involved.”

I think that’s a very common thing that can happen. We really felt like it was a great moment to take a step back and say, “Sure, there’s the issues where if something were to happen to one of us, do we both make sure we have a good understanding of the whole plan?” But just objectively, day-to-day, week-to-week, month-to-month, year-to-year, especially in the phase that were life that we’re in, it just makes sense that she would really be taking the lead in what we’re working on financially.

[00:07:49] RH: Well, that’s right. When you think about, look, we’re all really busy, right? Division of labor in a partnership, in a marriage, is important. You don’t both need to always take the kids to school. You don’t both need to walk the dog together. I mean, if you can, that’s wonderful, that’s fabulous. But the reality is that, we all take on a lot. So, we need to divide and conquer at times, to be most efficient.

My point is, that’s not what we need to do with money. With money—when it comes to money, and planning money and understanding personal finance, it’s something that we need to at least collaborate on once a month, so that we know. That’s exactly right, as you said. Here are the reasons that women are so vulnerable. Number one, we live longer than men. Even if you live a full life, chances are that a woman’s going to live eight years at the end of her life on her own. We earn less money because we spend more time out of the workforce; therefore, we have less Social Security. And we earn less. We earn $0.80 to the dollar that a man makes.

This is why 80 percent of women, 65 and older, live in poverty (80 percent more than men). That’s astounding. I mean, that’s a problem. Women need to get involved with personal finance, take the reins of their money, and really understand how to grow their wealth. So that if they did or when they do end up on their own, they’ll be able to handle it.

[00:09:13] TU: Which is a great call to action. Our communities, I mentioned before, we hit record, the pharmacy profession is predominantly more women than men, especially as of late with graduates over the last 20 years or so. Such a good call to action and reinforcement for our community. So, the Savvy Documentary addresses why women across the board often take a passive role or give up their role in managing their finances. You say, particularly in millennial. Obviously, there’s many factors as to why, but what do you feel like is the greatest obstacle or two for women being able to take control of their finances?

[00:09:46] RH: Probably intimidation. I think what happens is that—I mean, the financial industry was built by men for men, not on purpose to exclude women. It’s just that’s the way it was when Wall Street was being created. It was men that was handling that, that organized that, right? So, along with that comes this sense of ambient belonging. We’re using a lot of acronyms, ETFs, SEP, your IRA, what do these things mean? Even very well-educated, very intelligent women can feel marginalized and can feel intimidated if they haven’t kept up and if they don’t understand.

Especially now with technology and the way fintech is working. There’s all sorts. I mean, cryptocurrency, there’s all sorts of new terminologies. It takes you no effort to keep up with what does this all mean, right? So, I think that that’s probably the biggest hurdle is this intimidation factor, thinking, “Oh, boy, I really should have kept up with this all these years and I haven’t. So now I’m behind and I don’t even know. It’s overwhelming. I don’t know how to catch up. I don’t even know how to start.”

Often the woman who is busy with kids and probably her own job and volunteer hours and everything else, doesn’t make the time to go to the financial planner with her spouse. Therefore, she doesn’t really have a great relationship with that person. 90 percent of women who are widowed or divorced changed financial planners or advisors within the first year. What does that tell you? That tells you that women are not relating to the financial advisor or the financial advisor doesn’t really understand the plights or the issues that women face when it comes to money, and they’re not really working to maintain their female clients.

[00:11:35] TU: Yeah. Perhaps weren’t invested in that relationship together or a part of the decision making for that relationship to begin with. It’s one of the reasons, when we’re talking with individuals that are looking for planning services, if it’s a situation where it’s a spouse or a significant other, but folks are doing that together, both parties need to be present from jump street.

Now, as time goes on and maybe that schedules get busy, maybe it’s not realistic that, for every single meeting, two people are always there. Upfront decision making, understanding the goals, the priorities, the issues, it’s so important to have both individuals that are involved. One of the things that you highlight in the documentary, that I thought was fascinating, is the statistic that when women invest, whether that’s hedge fund managers, mutual fund managers, or individually, they outperform men by about 1 percent annually.

When I saw that, we preach and teach on this podcast, that 1% really matters. Our listeners know that in terms of a compound effective 1 percent over time, whether that’s in returns or perhaps fees or a combination of both, so when I see 1 percent, that matters, that’s significant. Why is this? What’s behind this? Tell us more.

[00:12:42] RH: Yeah. I think it’s one basis point a year, which corresponds to about 1 percent. I think what that is, is women are more risk aware. They’re not more risk averse. They’re more risk aware. So, women understand the risks involved in investing. They might pay a little bit more attention into being well diversified, to not jump into something that sounds like it’s a really good investment but could have a huge negative impact on a portfolio if it were to go wrong. So, because of that, because of women’s patience and their sensibilities to risk, they tend to make better investment decisions.

[00:13:22] TU: Yeah. That, of course, compounds over time. We know when you look at simulations of portfolios, if you’re able to mitigate the volatility of a portfolio, but take on appropriate risks of the long term, you’re going to see really good returns, so that makes sense. The other aspect that I’ve seen, in my own situation, and a pharmacist I talk with (all across the country, the men that are pharmacist that listen may not like me calling them out), but there tends to be a little bit more overconfidence that I see in terms of— certainly there’s varying levels of education—but is there an openness and a receptiveness to learn and to have someone come alongside of you to be able to advise, but also to keep your accountability? I know that’s a big generalization, of course, but I think there’s a different level of receptiveness that may come to that as well.

[00:14:09] RH: Well, there’s no doubt that there’s a confidence gap when it comes to women and to girls. This is just something that we tend to suffer from, right? There have been some really interesting studies, and in catalyst of the study several years ago that showed ten different qualifications that you would need, whether you’re a woman or a man, to apply for a job. Men tended to apply with confidence if they had even just 60 percent of the qualifications, right? Women even who had 100 percent of the qualifications still were not 100 percent confident that they would get the job or that they qualified for the job. So, there’s a big difference in physiologically. Is that because of testosterone? Maybe.

What it says is that we need to push ourselves as women. We need to push ourselves to become more confident, to take on investing, to decide that we’re going to take that promotion in order to stay on a good career trajectory, because otherwise, I don’t know that we’ll ever feel 100 percent confident that we’re ready for that next step. But when we do take it, we perform well, right? So, it’s just a matter of feeling confident and understanding that we can take that risk.

[00:15:24] TU: Yeah. As you challenge the women to lean into that confidence and be comfortable taking some of that risk, I would challenge the men listening to really ask themselves, “Am I perhaps overconfident in the financial plan? What are the opportunities for learning and improvement and perhaps a different perspective as well?” Robin, you also touched on in the film Negotiation Skills, a topic we’ve talked about in this podcast before, specifically around credit card negotiation, salary negotiation. Why is this so important for women to develop and refine, and why do you think it’s something that many women may shy away from?

[00:15:55] RH: Well, I think we shy away from it, because the confidence gap, what we just talked about. But negotiating is a really interesting thing, because what happens is that women and men, when we negotiate, women tend to outperform men in negotiations, but only when women are negotiating on behalf of somebody else. When we negotiate for ourselves, we are not as successful. Why is that? Well, it’s because in our society, women are supposed to be especially, a good woman, right, is supposed to be supportive, deferential. We are not necessarily rewarded when we come across as overly confident, overly assertive, decisive, right? But those are things that men actually are rewarded for, because they are seen as leadership skills in men more than they are in women.

This comes into this likability dilemma. But when it comes to negotiating, it’s fascinating, because women, we violate societal norms of what it is to be a likable woman when we are negotiating hard for ourselves. We come across as being selfish and self-centered and maybe even greedy, right? Which is ridiculous, but those qualities, we tend to tolerate more in men and expect more of in men than in women. So, what does that mean? Women have to often come to the table, negotiate and give examples of why they need money, which is interesting. Why they would need a higher salary? Those are things that men aren’t burdened with as much. I think that if you’re an employer, I think we need to pay attention to this. We need to understand.

If you want to retain women, if you want women to rise in your company, we need one: to push them to take promotions. Two, understand that it’s going to be harder for her to ask for a salary raise, even though she has earned it and deserves it. So, we need to be aware of that. We need to also be aware of the fact that women know how we’re perceived when we negotiate. So, we are careful about how we negotiate in what we do. The reason we need to continue to negotiate successfully regardless is because otherwise the pay gap widens.

[00:18:09] TU: Yep. That’s where my mind is just going around with the pay gap and I appreciate the call to action to the employers that are listening. So important to be aware of it and to be taken action appropriately, especially in a field like pharmacy where we have great flexibility, where pharmacists may through different seasons of life, cutback hours or increase and then take back hours or overtime, depending on family needs and other needs, which is a great benefit, but also can be a challenge if you’re stepping out and into the workforce to make sure that that pay differential is not widening over time.

I think the responsibility certainly lies in part on the employer, also in the individual, to be able to effectively negotiate for themselves and to be confident in doing that. It’s a great, great piece. We often, on this show, talk about the lack of financial literacy available to pharmacists while they’re in pharmacy school. I know financial literacy education is a big topic, one I’m passionate about, that really should start as early as possible and be as longitudinal as possible. This is really striking for our profession, where we have new graduates coming out on average with about $170,000 in student loan debt. Because of the lack of financial literacy of education, I think it’s easy to make missteps along the way.

My question here is, were there any key lessons that you took away from the documentary, in the preparation of the documentary, that really focuses on helping to improve financial literacy among women? Even if it’s access or interest, how do we overall raise the level of financial literacy in education and make it one that is accessible of interest and also is able to be action oriented?

[00:19:46] RH: Well, and this is for men and women, we need to have relatable financial education courses in school and in high school even. I mean, I’m even a proponent for starting them age appropriately in grade school. But there’s no reason that you can’t learn in high school the positive and negative impacts of compounding interest for example. You need to understand that you can’t just— that you need a credit card. First of all, you need a credit card in order to establish good credit.

In fact, when you get to college and you’re going to rent an apartment, they’re going to check your credit score. S,o you need to establish a credit score by having a credit card and yet paying off the minimum. Nobody teaches us how to use credit cards, right? Unless we’re having to have parents that teaches these things. Otherwise, you, probably everybody, that comes out of school comes out of the pharmacist training and school gets, what, maybe three different credit card invitations a month?

[00:20:40] TU: At least.

[00:20:41] RH: Yeah. At least, if not a week, right? I mean, it’s ridiculous. Yet in any of those, unless you’re going to— even if you read the fine print, does anybody stop and say, “ut here, let me actually teach you how to use this.” Because paying the minimum is not enough. Paying the minimum means you’re actually going to be paying interest, right?

[00:20:58] TU: Yeah. Lot of interest.

[00:20:58] RH: Interest is accruing, a lot of interest. Some of those credit cards, those initial credit cards, are over 25 percent, so that’s huge. I think that’s essential for men and for women. We need to know what our credit score is. We need to pay off the total balance on a credit card every single month. We need to use less than 10 percent usage of it in order to have the highest credit score rating. But these are things that nobody teaches us, right? I think that’s important. Then I also think that, yes, whether you’re in business school, whether you’re coming out of pharmaceutical school. There’s no reason that there can’t be an education or finance course that’s specific to your industry, right? I think that that’s something that we’re owed, especially if you’re going to end up with $170,000 in student loans debt.

[00:21:43] TU: Yeah. I think we’re starting to see momentum among this. I think there’s other health professions I would give kudos to. I think medicine has done this well, from an association colleges standpoint. Veterinary medicine has done this well, from an association colleges standpoint. I think what we need immediate past is the stigma and the idea that this is a doctorate level education and personal finance doesn’t belong. It does belong, right. Because we know the connection between financial wellness and one’s ability to be a clinician and to work effectively in their role. Those things are very well connected. So, I think we’re starting to see momentum in our profession around this topic, which is very exciting.

Of course, for folks that are listening and have kids at home, what a great opportunity to just begin conversations as early as you possibly can. These come up all the time if you watch and listen for them. I remember being with my oldest son, who’s now about to be 11, probably when he was five, maybe six, and we’re at the grocery store and he just asked me a question once at checkout. He was like, “Oh, so dad, you just swipe the card and then you get the groceries. Is that how it works? You just swipe the card and you get what you need?” I was like, oh, my gosh, what a great teaching moment, about how does money go from work into a bank account. There’s not physical cash, right?

This is such an incredible learning moment, but that is a foreign concept. If a child gets money from a gift or from work and it ends up online, but I don’t see it in front of me, but it’s in an account. What? What is that? What does that mean? So, I think just such a great opportunity to be having these conversations, if we’re in a position to do that.

[00:23:18] RH: Yeah. It’s so interesting. The psychology behind all that too, right? We are just swiping. I mean, it’d be interesting to see how your son would react if you pulled out your wallet and paid in cash, which none of us do anymore for the groceries, as opposed to swiping that card, right? There’s something that they talk about called a pain of paying. I think that’s really interesting, because it is much less painful to pay with a credit card. It’s more painful when we see our balance at the end of the month than we have to say, “Okay, pay that off.” But in terms of swiping versus taking out a few twenties or fifties from our wallet, that hits us a little bit more in terms of the pain.

Let me tell you, I mean, with Venmo. What’s Venmo? I mean, that it’s crazy, right? There’s just this fictitious balance. I mean, it is a balance, actually, but you almost forget that it’s tied to your checking account and there seems to be no pain in that at all, which is why it’s so easy to spend.

[00:24:15] TU: Yeah. One of things my boys will often ask me now, I guess I’m glad that they’re comfortable asking the question, but they often ask, “How much does that cost you, Dad? How much is that cost you?” Sometimes your reaction is like, “Oh, my gosh, I had no idea.” Or “Oh, that’s not bad.” I’m like, “Well, it’s still a lot of money and let’s have a conversation about work.” But you also want to create a scarcity mindset. So, there’s a delicate balance as you’re having these conversations with kids about money, but there’s things they can relate to, right?

If they get a dollar or $3, or whatever the tooth fairy pays now nowadays for a tooth, they understand what that is. If they can understand something cost $20 or $50 that might really resonate with them and be able to put their arms around exactly what is the amount of something. And, to your comment about the pain of paying, it becomes real when they can really see the tangible dollars that are at play. One of the other things I wanted to ask you about is it feels like, to me, there’s a significant inequality of who is leading the financial education out there. One of the reasons I was so glad to see this documentary specifically geared towards empowering women around money, and obviously the work that you’ve done here is— it feels like if you look at the traditional education around financial topics, it is largely led by men.

Now I think that’s shifting what’s happening, but let me give one example. I’m going down the rabbit hole right now. I’m learning about cryptocurrency. One, because it’s a topic I feel like I’ve got a baseline knowledge in, but as we get more questions, I want to, myself, become more knowledgeable. I’m digesting YouTube videos and blogs and books, and I’m pretty far into the journey. I can maybe think of on one hand (if even that many) women that are leading the conversation and the education around cryptocurrency. Well, that’s one example. I think it sheds light into other areas of the finances, whether we’re talking about the alphabet soup of retirement planning, or estate planning, or tax planning. It feels so heavy on the male side of the equation as it relates to financial education literacy. Am I reading that correctly?

[00:26:17] RH: Well, yeah. I think so, because I mean, there are many more male financial advisors than there are women. This is something that there’s a big effort to change in trying to get more women into financial advising, but I think especially when it comes to crypto, and why? Well, because crypto’s a merge of finance (which we know is male oriented) and computer science, which is male oriented. When you take two things that tend to have the stereotype to be very male-centric, I think it stands to reason that there are less women there. Again, back to that idea of ambient belonging. I mean, if you just don’t feel you belong there, if it doesn’t feel like home when you’re—so if a woman goes to a cryptocurrency conference and she’s one of the only or the few women there, she’s going to feel like she doesn’t belong, right?

It’s really hard to pioneer and to push through being the minority, and many women have. Same goes for people of color, right? I do think that it’s hard to be what you can’t see. So, we need to get more women into finance and into crypto, into computer science and sciences in general. I love hearing that pharmaceuticals has a stronghold of women, that is fabulous. But this is what we need to do in order to change the stereotype.

[00:27:39] TU: Well, this is great, Robin. I really appreciate the conversation. I would encourage folks to make sure that they check out the Documentary Savvy. We’ll link to it in the show notes. Where is the best place that folks can go to learn more about you and to follow the journey and the work that you’re doing?

[00:27:53] RH: Well, finishlinefeaturefilms.com is our website. We will list different screenings of Savvy, whether it’s film festivals or whether we’re doing public screenings, you’ll find them listed there. So, keep an eye on that website.

[00:28:06] TU: Awesome. We’ll link to that in the show notes. Thank you so much, Robin, for your time. I appreciate it.

[00:28:10] RH: Thank you, Tim.

[OUTRO]

[00:28:11] TU: Before we wrap up today’s episode of the Your Financial Pharmacist podcast, I want to again thank our sponsor, the American Pharmacists Association. APhA is every pharmacist’s ally, advocating on your behalf for better working conditions per PBM practices, and more opportunities for pharmacists to provide care. Make sure to join a bolder APhA to gain premier access to financial educational resources and to receive discounts on YFP products and services. You can join APhA at a 25 percent discount by visiting pharmacies.com/join and using the coupon code YFP. Again that pharmacies.com/join, using the coupon code YFP.

[DISCLAIMER]

[00:28:50] TU: As we conclude this week’s podcast, an important reminder that the content on this show is provided to you for your 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 this 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 for your support to the Your Financial Pharmacist Podcast. Have a great rest your week.

[END]

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YFP 259: Building a Medical Writing Business with Megan Freeland

Posted on June 9, 2022November 2, 2022 by yfpadmin

Building a Medical Writing Business with Megan Freeland

On this episode, sponsored by Insuring Income, Megan Freeland, PharmD, talks about talk about her career path in medical writing, the types of health content writing that might interest pharmacists, and how she created the Health Professionals to Health Writers program.

About Today’s Guest

For the longest, Megan’s ultimate career goal was to become a public health pharmacist working for the Centers for Disease Control and Prevention. She accomplished that goal on multiple occasions — supporting divisions related to medication safety, health communications, and emergency preparedness and response — but realized she was missing the opportunity to apply a creative flair to her writing career.

Megan set out on her own to build a health content marketing company. Through StockRose Creative, LLC, Megan supports innovative health organizations, helping them use the power of words to reach their target customers and clients and turn them into raving fans. She uses a strategic approach to develop culturally-relevant content for digital health companies and health information websites. At the same time, Megan runs the Health Professionals to Health Writers program, which helps pharmacists and other health care providers learn how to replace a portion of their income through freelance health content writing.

Earlier this year, Megan also began lending her talents to an in-house communications team for the nation’s leading provider of sexual and reproductive health care and education.

When she’s not writing, reading about writing, or teaching others how to write, she’s binging podcasts and new music, scoping out the latest Peloton apparel drops, and laughing hysterically with — or at — her two young children and husband.

Episode Summary

In this episode, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, is joined by Megan Freeland, a pharmacist, entrepreneur, and health content writing expert. Megan is the creator of StockRose Creative LLC, where she supports health organizations, helping them use the power of words to reach their target customers and clients. In this discussion, Megan shares how she unexpectedly found herself with a career path in medical writing after accomplishing her ultimate career goal of becoming a public health pharmacist working for the Centers for Disease Control and Prevention. Megan explains the types of health content writing pharmacists may be interested in pursuing and why many individuals get started in health content writing. She also shares how she saw the opportunity to create the Health Professionals to Health Writers program, helping pharmacists and other health care providers learn how to replace a portion of their income through freelance health content writing. Throughout the episode, listeners will discover how Megan’s passion for public health has been pivotal in the decisions that brought her to her current position. From volunteer work in healthcare centers, fellowships at the CDC, and sitting on the SNPhA board to an unexpected pregnancy, opportunities with the FDA, and more, Megan educates the listener on the art of life management while pursuing your dreams.

Key Points From This Episode

Understanding Megan Freeland’s career by looking at her interests and background in pharmacy.
How to apply knowledge and experience in pharmacy to the public health system.
What opportunities Megan took to further explore public health training and experience.
The hard journey she took to end up at her dream job in the CDC.
Her passion and motivation for the intersection of public health and writing.
The influence Megan’s family and community had on her passion for public health care.
Understanding the types of medical writing and how to pursue one.
A guide to beginning your career as a freelance health content writer.
Megan’s ideas, goals, and motivations behind StockRose Creative.
A look into how Megan has grown her career on LinkedIn.
Advice for those starting to pursue their content writing careers.

Highlights

“All of the opportunities that I was taking part in to try to enhance my candidacy for being in a public health space, all of those roles and opportunities involved writing in some way.” — Megan Freeland, PharmD [0:04:33]

“People are thinking about their own experiences and their own limitations when they are thinking about what you are or are not capable of doing. Even though they have the best intentions, those ideas and those preconceived notions get projected onto you.” — Megan Freeland, PharmD [0:15:53]

“It wasn’t just my individual, nuclear, or immediate family’s health conditions that I was aware of, but we were all aware of everybody’s business. I saw how important it was for people to have good healthcare and good health information.” — Megan Freeland, PharmD [0:19:03]

“I think about the environment, information, and access to healthcare and good health information, how critical that is to the health of communities — as a black woman in the world, that level of awareness that comes with that lived experience as well.” — Megan Freeland, PharmD [0:19:37]

“You are not necessarily a reflection of the people who are trying to learn from you.” — Megan Freeland, PharmD [0:39:36]

“Your life is your own, no one else is responsible for what you do. No one else has to live with your decisions or your choices — know that you are deserving of having the professional trajectory, having the life, having the career, having the whatever that you decide you want.” — Megan Freeland, PharmD [0:42:37]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[0:00:00.4] 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 a chance to sit down with Megan Freeland, pharmacist, entrepreneur, and health content writing expert. Megan is the Founder of StockRose Creative, where she supports healthcare organizations, helping them use the power of words to reach their target customers and clients and turn them into raving fans.

A few of my highlights from the show include Megan talk about how she unexpectedly found herself in a career path in medical writing after accomplishing her ultimate career goal to become a public health pharmacist working for the CDC, the types of health content writing that pharmacist may be interested in, pursuing and the main reason that individuals get started in this field and how she saw an opportunity to create the health professionals to health writers program where she helps pharmacists and other healthcare providers learn how to replace a portion of their income through freelance health content writing.

Before we jump into the show, I recognized that many listeners may not be aware of what the team at YFP planning does in working one-on-one with more than 240 household 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 working one-on-one with a certified financial planner that 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 into my interview with Megan Freeland, Creator of StockRose Creative.

[SPONSOR MESSAGE]

[0:01:42.8] TU: This week’s podcast episode is brought to you by Insuring Income. Insuring Income is your source for all things term life insurance and own occupation disability insurance. Insuring Income has a relationship with America’s top-rated term life insurance and disability insurance companies, so pharmacists like you can easily find the best solutions for your personal situation. To better serve you, Insuring Income reviews all applicable carriers in the marketplace for your desired coverage, supports clients in all 50 states, and makes sure all of your questions get answered.

[INTERVIEW]

[0:02:34.4] TU: Megan, welcome to the podcast.

[0:02:36.0] MF: Hello, Tim. I’m so excited to be here with you, thanks for having me.

[0:02:39.8] TU: I too am excited. We had a chance to connect several months ago and I’ve been excited to do this interview to share your story, your entrepreneurial journey with the YFP community. Let’s start off by hearing about your background, where did you go to pharmacy school, and what ultimately was some of your interest in going into pharmacy in the first place.

[0:02:57.6] MF: Great question and thank you for orienting me with this question, because whenever I get that background question, I’m like, “Where do we start?” I went to undergrad at Emory University and then I stayed in Atlanta for pharmacy school to attend Mercer University. When I went into pharmacy, I did not necessarily go into the field with the intention of practicing in the traditional sense.

When I was still in undergrad, I was trying to decide whether I wanted to pursue public health or whether I wanted to pursue pharmacy and I was encouraged by family members, my mom namely, to go into pharmacy because she was frankly disappointed that I decided that I did not want to go to medical school anymore and her thought was, “Well, at least, if you go to pharmacy school, you still come out with a doctorate degree.”

So I listened to mom and I chose to go to pharmacy school but I still had that public health bug in the back of my mind and so, my goal was to figure out, “Okay, how can I apply the experience, the knowledge that I gained through the pharmacy program to a public health setting?” How can I become essentially, a public health pharmacist when I leave?

Obviously, didn’t have a whole lot of guidance or examples to look to because at that time and even still now, there weren’t a whole lot of people who were kind of going down that public health path with the pharmacy background. So what was very much four year period of trial and error and kind of figuring out where I landed and how I could make that happen and what I noticed was that all of the opportunities that I was taking part in to try to enhance my candidacy for being in a public health space, all of those roles and opportunities involved writing in some way.

So, once I noticed that pattern, I decided, “Okay, well, this is kind of naturally the course that I’m going along, so I’ll just keep doing this and see where it takes me.”

[0:04:56.8] TU: It’s really interesting, Megan. I think it’s rare that someone goes into the pharmacy degree with a thought of a non-traditional career path these days. One example that I am passionate about is that my hope is that we can begin to see the PharmD education as being more of a gateway to many different opportunities and you know, not just one or two different pathways which folks may typically associate with.

So I think that’s really neat to hear that someone entered in with that non-traditional path and let me ask you a follow-up to that then, as you went into pharmacy school with a specific interest in public health, which isn’t a surprise, right? Emory University is known for their public health training, what specific opportunities did you look for in pharmacy school to further explore and build upon that interest?

Was there an organizations, was there specific internships, or rotations you’re able to get more experience, tell us more about how you’re able to foster that interest during pharmacy school?

[0:05:51.3] MF: Yeah, I love that question. And yes, that was not coincidental at all, actually, I’m originally from Columbia, South Carolina, and in the 9th grade, my magnet program, we took a field trip to Atlanta, and during that trip, we toured Emory and we also toured the CDC, which is right next door to Emory. So in the ninth grade, I decided, when I go to college, I’m going to Emory University and I’m going to work for the CDC.

So, it kind of was like a full circle situation but when I got to pharmacy school, I noticed that a lot of the extracurricular opportunities, the clubs, the programs, they were all pharmacy-related and so for me, I felt like, “Yes, I could do these things but will they really help me in the public health setting?” I’m going to have the degree, that takes care of my pharmacy qualifications.

I felt like anything that I was doing outside of going to class and taking tests needed to be more specific to public health in some way and so because of that, I was actually looking for opportunities outside of my school’s ecosystem because those were not what I felt like I needed to increase my candidacy for public health.

I looked at community organizations, I ended up volunteering at a center called, The Feminist Woman’s Health Center in Atlanta. They do a lot of education around sexual and reproductive health and I ended up volunteering on their health and education training committee for all four years of pharmacy school.

I looked into the CDC to see what types of internships or fellowships they offer that pharmacy students were eligible for. So, the summer after my second year of pharmacy school, I completed a CDC fellowship, it was called the Emerging Infectious Diseases Fellowship and it lasted for nine weeks, you were paired with a mentor, you actually worked on CDC teams, worked on a project, presented, everything.

I traveled to Panama for an epidemiology investigation in a Panamanian hospital. Those are like two of the core examples but any other time that I was engaging in extracurriculars, I made sure that they were related to public health in some way. One more that I just thought of, I was a part of SNPhA, the Student National Pharmacist Association and I participated in some of their community service projects because again, those are more public health facing educational opportunities.

I always had that lens and that perspective whenever I was doing anything outside of going to class, taking tests, and trying to get my degree.

[0:08:34.8] TU: I love the intentional and I hope if we have any students listening, they go back and rewind and listen to that because the message I hear there is that sometimes we got to get outside of the walls of the college or pharmacy to explore other opportunities and again, the PharmD can be used in so many different ways and I think your story here is a great example of that but sometimes it takes some creative thinking and it takes some initiative to see what those opportunities may be.

Tell us more one of the things you shared to me before is that you know, working for the CDC was a dream for you and you’re ultimately able to achieve that. Tell us more about what happened right after you graduated from pharmacy school. So it was during school, you identify this growing interest in public health, you see the connection to writing and then you have an opportunity to do an industry, fellowship as well as some work with the CDC thereafter, tell us more about those experiences.

[0:09:22.0] MF: Yeah, as I was going through pharmacy school and kind of collect these experiences that I hoped would be helpful for me in the future. I was also trying to think about what the immediate step post-graduation would be. My goal was to go straight back to the CDC after graduation. Those are the opportunities that I was most excited about and most intentional about but it wasn’t working out.

I wasn’t getting any opportunities that would be timely for me to start right after graduation and so I said, “Okay, if I can’t get to the CDC right now, what are other opportunities that I could take part in that were still public health-related that would still help me get back to CDC down the line?” So I looked into industry fellowships and I was specifically attracted to one program in particular because it had an FDA rotation as a component of the fellowship.

I graduated in 2015. So, at that time, it was one of the only industry fellowships that had any type of public health rotation as a part of it. It wasn’t like I had all of these choices. I did apply to many more programs because I would have made it work but this one, in particular, was of interest to me because of the FDA component and so that’s the fellowship program that I ended up getting accepted into.

Ironically, I got pregnant unexpectedly during the first year of my fellowship and so I never actually made it to the FDA rotation of the program. I was in the middle of my second rotation when I found out I was pregnant. What happened at that point was that I was located in New Jersey, the portion of my fellowship I was in at the time was the medical information rotation for Johnson Scientific Affairs, which is the pharmaceutical arm of Johnson & Johnson.

I was in New Jersey and I’m like, “Okay, well, I need to move back home” where my now husband but boyfriend at the time was and we have to get ready for it to be parents and so, I’m like, “Well, that also means I need a job because I can’t do my rotation from Atlanta” you know, maybe if it was 2020 or 2021, things are different now, maybe that would have worked out but at that time, basically, we just brought my rotation at one year instead of two.

I went back to the CDC drawing board, I was looking for fellowships, I was also applying to a whole bunch of other jobs mind you because like, this was survival at this point in time. It wasn’t about my preferences, I just needed a job in Atlanta but I was also looking for CDC opportunities and I saw this opportunity that was in the same department that I had completed my fellowship program in during pharmacy school.

I reached out to my mentor from that fellowship to ask her if she knew anything about the position, she wasn’t the hiring manager but she knew the person who was and so she connected me with that person, I went through the application, the interview process, everything and I got that position. I ended up back at the CDC, back at home in Atlanta, preparing for, to become a parent, and a lot of this story that I tell, it’s important for me to say that like, it sounds great now but that’s because I’m reflecting on past experiences, right?

Hindsight feels a lot better but all this journey was not easy. Even during pharmacy school, when I was engaging in all of these non-pharmacy specific projects, it was uncomfortable because I didn’t know if what I was trying to do was actually going to work and I had a lot of people who meant well, advisors, faculty members, in my ear, saying that I needed to go another route.

Similarly, with the fellowship experience, I was very disappointed in myself for not being able to complete my fellowship and I had three preceptors, which meant I had to tell three different people, “Hey, sorry, I’m pregnant and I can’t finish the fellowship” but they were all super supportive and when I got that role back at the CDC, one of my, I probably shouldn’t have favorites but one of my favorite preceptors said, “You should be proud of yourself because this two-year program was supposed to prepare you for a role like the one that you just got, not even nine months into your fellowship.”

“You should feel very proud of yourself.” I burst into tears because I was emotional and it was a lot going on, that really helped me put it into perspective. So that’s how I got back to the CDC. I should also add, the fellowship that I completed was in drug information and the CDC fellowship that I started after the one year of my fellowship was in health communications.

[0:14:10.0] TU: And we’re going to come back to more of the expansion on the interest and writing and where that has led to the work that you’re doing today. I want to come back real quick, Megan. You said something really important which I want – especially if we have any students listening. I want them to hear is that, you were given advice by several folks that I think, probably had good intent that maybe you should consider a different pathway and I can tell you from being in the academic environment for several years, we like very linear pathways, right?

We like very linear pathways where we know this opportunity’s going to lead to that opportunity and your pathway wasn’t necessarily linear in that you were coming in with somewhat of a nontraditional interest. You were getting different experiences but what you were doing is you were planting a lot of seeds and building a lot of relationships that sometimes it takes time for those to grow, right?

To flourish and I just love the passion and the interest that you had and continuing to pursue that, despite perhaps some outside noise of, “Maybe you might consider this and maybe you might consider that” and I think the lesson I hear there is, pursue the interest, plant the seeds, trust he process as you’re continuing to move forward and it might not always feel like one dot is going to connect to the next but I think as you shared in hindsight, you can start to appreciate how some of those things come together.

[0:15:24.3] MF: Absolutely. Trust the process and also trust yourself. One of the people who was encouraging me to do a residency which that’s what everybody was telling me to do, even my mentor at the CDC, understanding that I wanted to follow in her footsteps like once I found her, I was like, “You’re the person who I want to be like” and even knowing what my intention was, she was like, “You know, I really think you should do a residency first” and I’m like, “I hear you,” but what happens is sometimes, people are thinking about their own experiences and their own limitations when they are thinking about what you are or are not capable of doing and even though they have the best intentions, those ideas and those preconceived notions get projected onto you.

It’s really important to trust yourself enough to be able to examine what your thoughts, your preferences, your intentions are as well as the advice from trusted people but then to make your own decision based off of all of that information, including your own desires and intentions.

[0:16:26.9] TU: That’s one of the passion that I have and I’m not going to get on the financial soapbox because I do that in every other episode but that’s one of the challenges I have in our profession is that, they’re so often is the financial pressure of the student loans, the golden handcuffs of that six-figure income that folks that might be thinking about something more nontraditional or not as structured in terms of, “I’m going into residency, I’m going to go into fellowship, I’m going to go make this income” it can just be hard to have the space to explore that when you have those other pressures that are there.

I want to come back and ask you, you’ve really done a nice job I think of outlining this interest that you have in public health and an interest in writing, we’re going to come back and talk more about that but I didn’t ask you, what is the why behind that? Where did that passion come from in this intersection of public health and writing and what really motivates you and inspire you towards the work that you’re doing?

[0:17:14.1] MF: That’s a good question and one that I don’t think about as often. I can say that my interest in writing, I wouldn’t call it a passion at this present time or at the time that it started but my interest in writing actually came from a work study job that I had when I was at Emory. I was lucky enough not to be assigned to like putting books back on the shelves at the library the way a lot of our friends were for work study but I had a job with CancerQuest, which is a patient education website that was associated with Emory’s Winship Cancer Institute, and my role for CancerQuests was basically to update and write a lot of the patient education information that was on the website.

So that was like a huge directory of all these different types of treatments, preventative measures, therapies for different types of cancer and so I had to do a lot of research and write information that could be interpreted by the general public. It was kind of my first taste of health communications but I did not have the language to be able to say, “This is what this is.” I would say, from that point that kind of planted the seed for my interest in medical writing and health communications, although I didn’t realize it until probably a decade later.

Public health, I think that’s just something that has been a part of my experience as a person in the world. Like growing up in Columbia, South Carolina, amongst my family members who dealt with their own personal health issues, we were in a very communal environment. So in my neighborhood, like, my grandmother knew all the people on her street, all the people on her block, we were all kind of family.

Because of that, it wasn’t just my individual, like my nuclear or immediate family’s health conditions that I was aware of but we were kind of all aware of everybody’s business and so I really saw how important it was for people to have good healthcare, good health information and again, I wouldn’t have been able to verbalize this as a child but looking back, all of this information was kind of more abstractly in my brain at that time.

I think that just as I progressed throughout school, like K through 12, undergrad, I started to think more concretely about how environment and information and access to healthcare and good health information how critical that is to the health of communities and I think that also, just kind of as a black woman in the world, that level of awareness that comes with that lived experience as well, public health was just something that kind of called my name.

When I went to that field trip in the 9th grade, and toured the CDC, I think that was probably the first time that I was able to connect the actual field of public health with all of that previous life experience that I just named.

[0:20:13.5] TU: Admittedly Megan, my knowledge related to medical writing, health writing, health content writing, we’ve used our term health communications is pretty elementary and I’ve seen these terms used in different ways, and for folks that are listening, thinking about, “Hey, maybe I’m interested in entering this field” and whatever way that may be, break those terms down a little bit further for us.

What are the differences between those and the types of writing opportunities that folks maybe able to pursue?

[0:20:40.5] MF: So this is a juicy question because there are so many routes that a person could take, depending on what their interest are. So if we kind of backup and go to the most high-level area of this, when we talk about medical writing, like you, many people are using that term, interchangeably. Some people might describe what I do health content writing as medical writing.

It’s not that there is anything wrong in particular with using that language, but, I think what some people don’t realize is that medical wiring is more of an umbrella term that could actually describe a lot of different types of writing. Same thing with health writing. So when I talk about broadly and holistically, this space, you will sometimes hear me say medical and health writing, that’s because those are the broadest terms that describe all of the individual types that come down from that.

When we get to talking about like specific examples, you’ve heard me reference specific examples during this conversation, right? You heard me reference a drug information fellowship, a health communications fellowship, I’m a health content writer, it really depends on who is the audience and what style of writing is being done. Those are like, the two big buckets that can kind of help differentiate the different types of medical writing.

Medical writing, I typically think of those types as writing that’s geared towards a clinical audience, an audience of health professionals, an audience of scientist, it’s typically more formal in nature and the topics are often times more specific to medicine, like actual treatment, prevention, therapies and so some specific types of medical writing would be drug information that adhere to a clinical audience.

Another type would be scientific writing, another type would be regulatory writing. So you will see a lot of regulatory positions at pharmaceutical companies because there are people there who are writing INDs, they’re writing documents that need to go to the FDA or to different regulatory associations, so that’s definitely a type of medical writing. Scientific publications is a type of medical writing.

Medical communications, so these are companies who are sometimes contracted by pharmaceutical companies to create materials, to educate other health professionals, right? So if you want to put together a slide deck or a post of presentation to present at a conference, that’s often happening at medical communications companies. So, all of those are examples of medical writing, which is often times again, a more formal and geared to a clinical or health professions audience.

Then, on the other side of that, you have the other umbrella term of health writing. Health writing, I typically think of as geared to a more lay or general public audience and the topics are not always so scientific or medical. They could be more wellness oriented or more health oriented but health oriented from the standpoint of how does an individual person apply this information to their actual life, not health oriented as in like all of the science of like how this drug works or blah-blah-blah.

Specific examples of health writing are health communications, the fellowship that I mentioned at the CDC. In that position, I was basically like a liaison between our research team and the general public. So when they would come up with their research, I would create fact sheets, blog post, maybe sometimes op-eds, talking points that could go on the website that regular folks could understand.

There is also health journalism, which is when you go to the Washington Post or you go to health magazine, those articles that you see in there, those are forms of health journalism and then my personal favorite, health content writing. We’ll probably dive more into content writing but broadly content writing is information or education that’s presented online in most cases that help someone solve a health problem or answer a health question.

One of the most common ways that content writing becomes visible is when you go to Google, right? If you’re a mom, a new mom at 4:00 in the morning and you baby is not latching and they won’t go to sleep and you go to Google and you say, “Help, my four-month-old isn’t latching” the information that comes up, some of it might be like forums, parent forums but the articles that come up often times those are examples of health content writing because they’re helping you answer a question or solve a health problem that you have.

[0:25:23.7] TU: That was great. I mean, probably the best explanations I’ve heard and I know you have my mind spinning of, “Okay, if I am thinking about this as a potential side hustle or career opportunity, okay, what are the different ways? What might be my strengths or interest?” What would yours that I’d want to pursue? So the examples there were really helpful. I have heard you talk before about three main reasons that folks may get started in medical and health writing.

Those could be number one, they want to influence the public health on a larger scale, number two is to use their degree along with a healthy dose of creativity and number three is to create an additional stream of income outside of their clinical career. My question for you knowing that you coach many other pharmacists and other healthcare professionals that are exploring this area of writing, do you see one of those resonate more than the others or are folks often entering into this space because of all three of those or some combination of them?

[0:26:18.1] MF: That’s a really good question. I think most people have – I will answer this question in two ways, there are people who are interested and then there are people who take the steps to pursue. Those are often two different types of people, so people who are interested of course can have any of those three reasons. It could be relevant but I find that often times the biggest draw is the additional stream of income.

But what happens is once they realize how much work it actually involves to get to the point where they are qualified to be a health content writing, only having the interest of an additional stream of income is not enough. It’s not enough –

[0:26:59.0] TU: It’s not a strong enough why right?

[0:27:00.0] MF: No, it’s not at all because the return on investment yes, could be there because like you can make a whole living out of health content writing and plenty of people do but to get to that point where you can even do that, the time that it takes to learn the skills, to create the portfolio, to go out and find clients, only being motivated by the money is oftentimes not good enough.

The students that I work with and even students, that pharmacists that do decide to pursue health content writing but they choose another route or aren’t necessarily in my program, I find that there is more of that interest in really influencing public health and utilizing their degree in a way that brings them fulfillment and joy and opportunity to actually educate people, which is something that we are often sold on during pharmacy school.

But in reality, in real life once you get out into the workforce, sometimes it’s not really a major piece of what you are able to do in your workspace. So a lot of the students that I work with express to me that of course, they love to have some extra money because you said it earlier, loans and debt and family but what they’re really looking for is a way to find more fulfillment and joy within their profession.

There are lots of side hustles, other opportunities that people could engage in to make money but people don’t necessarily want to let their degree and their education and their experience go. It is not that they don’t love pharmacy or love healthcare, it’s that maybe they don’t love the way that they have to execute it in their full-time roles. So if there’s a way for them to still use the background that they have in a more fulfilling and impactful way, then they’re very into that.

[0:28:50.0] TU: So well said, you know, often I say and feel myself that forward progress and growth is such an important factor for us as individuals and human being, that we have a feeling of growth that we’re developing ourselves and I think for many pharmacists that may be are feeling stuck or they aren’t feeling that growth or they aren’t feeling like they’re using their degree to their full potential, that can be a suffocating feeling.

I often say that side hustle’s income that’s a nice symptom but really what we want to be focusing on I think in part and not overlook is, what’s the motivation, what’s the purpose, what creative outlet is this providing and that’s a hard benefit to measure but don’t underestimate it because it’s so powerful especially if you feel like you’re in a situation where you’re stuck. It’s so powerful to feel like you’re growing, you’re developing and you’re moving forward.

Let me ask you a question I’m sure you get all the time, which is: can I work full-time doing this? Is that a viable pathway to grow a medical writing business?

[0:29:49.3] MF: Yeah, so I’d say that the answer is emphatically yes. When I started out as a freelance health content writer, I had a full-time job. I will do a quick aside to address something that you just brought up in terms of having that source of fulfillment is I was in a job that I did not like. It was my third time at the CDC and it was a regulatory writing job and it was not my most exciting role and so I started blogging on the side just because I needed a creative outlet.

That really helped me when I was in that full-time role that I didn’t like because I had something that was going on that was interesting to me and so that was exactly how I got started as a health content writer. I had a full-time job at the time, it was accidental because I was not yet aware that health content writing was a field and so when I started my blog, it just so happened that a health company saw it and reached out to me and asked if I was right for them.

That was how I first freelance writing opportunity but it wasn’t until a year and nine months later that I actually left my full-time job for that entire year and nine months, I was freelancing on the side. So it’s definitely possible, I would say it is definitely one of the most common approaches. If you are in a position where you are just learning the skill of freelance health content writing, I don’t know what your financials are like.

If you have a couple of tens of thousands in the bank and you can afford to just shut your full-time work down so that you can focus on freelance health content writing, that’s definitely open to you but for most people, it’s going to take time to even get the foundations that you need to be able to get started and then once you start, it’s going to take you some time to get your feet under you and get to the point where you can bring on more and more clients.

So, in most cases, it actually makes sense to start with a full-time job so that you are not reliant upon this income source that you haven’t yet created. So definitely possible, it just takes time management and availability of time as well.

[0:32:02.2] TU: Yeah and I am a firm believer as you kind of were eluding to there that building a business upon the back of a strong personal financial foundation is so important, right? Because you can approach that opportunity with less stress, you can approach that opportunity with confidence and perhaps some folks can manage to make that jump and not to have that stress still if they have additional savings.

But I think for many, having that full-time job will allow them to pursue that opportunity with confidence and to minimize that stress. Talk to us about StockRose Creative, the company that you’ve started and have been growing, talk to us about what it is, how it came to be and what are the services that you offer?

[0:32:38.4] MF: Yeah, so StockRose is the business entity that I created when I decided to go full-time in my health content writing work. Unlike the students that I work with, I did not have real guidance when I got into the health content writing space. I was just out here figuring it out on my own and so because of that, I dabbled in a lot of different types of writing through StockRose before I landed on health content writing solely and before I got even narrower in the specific types of writing services that I was offering through health content writing.

Today, what that looks like is I offer blog writing and video scripting services particularly for digital health companies and especially if those digital health companies have audiences that are primarily black or they have portions of their audiences that are primarily black and the reason for that is because content writing is a very small piece of content marketing. It’s a much broader process and so a part of what you had to do if you’re interested in being a freelance health content writer is you have to understand how that fits into the broader process.

With that, strategy is a part of the process that has to come before writing and sometimes companies, they do not have that strategic part in-house and so I consult with them to say, “Hey, if you have audiences that are black or primarily black, you’re going to have to develop a different content strategy in order to actually have content writers that are writing effectively for those audiences.”

That’s the core service that I provide but it did not start out that way, it was much more lose and difficult to define because I was figuring it out as I went along. So that’s kind of the service part of my company and then the coaching part of my company, I’ll kind of give some context to how that came about. I really sat down one day and thought, “What is the theme of my professional career?”

I’ve had a lot of different roles and they’ve all had writing in common but beyond that, what kind of links everything together? I realized that in all of my past, fighting health misinformation and putting out good health information has been the theme that connects everything together and is what I’m passionate about and what I want to continue doing into the future and so if I want to fight health misinformation, which is getting more rampant by the minute it seems, I am not the only person who can or should be doing that.

There are more people and specifically, healthcare providers who should be doing that. The problem is that most healthcare providers don’t have experience in health content writing or creating online content. It is not because they can’t do it, it’s just because they don’t have the exposure or the experience in order to be able to do it. So the question is, well, how do they get that? Technically, I could hire them.

However, I am not particularly interested in running an agency or managing other writers like that’s just when you get to the point where you’re running an agency, it often takes you out of the actual execution of whatever the service that you’re providing and you become a manager and my passion is about the creation of the health information. So my question was, “Well, how do I help other healthcare professionals become health writers so that they too can be able to counter the misinformation that’s out there?”

I decided that creating this accelerator program called Health Professionals to Health Writers, where there is didactic teaching to make sure people have the foundational knowledge of content marketing that they need, where they are able to create the portfolio of samples that they need to actually get freelance gigs and where they actually build out the business processes they need to know how to go out and secure clients.

That would be the way to help more professionals have the skills and the experience that they need to be freelance health content writers as well. So that’s what my coaching side of StockRose does under the Health Professionals to Health Writers accelerator program.

[0:36:58.0] TU: I love that and I think that aligns so well with your why, right? Of how you got into this in the first place. You talk about fighting misinformation and looking at doing that on a broader scale, the impact of that is you coach up and train up other pharmacists, other healthcare professionals, the impact of that is going to be much greater than your writing alone or even a team or writing if you did go with that approach.

We’ll link in the show notes, that’s stockrosecreative.com, folks can go there. We’re also going to link in the show notes, you have a Health Writing for Health Professionals 101 series on YouTube, and then folks can also learn more about the accelerator program that you mentioned as well, some of the work that you’re doing. I do want to ask you, this is somewhat of an aside, but I think a really cool accomplishment, I’ve been following your work on LinkedIn, and I saw you recently went through the LinkedIn Creator Accelerator Program as a part of the first class of a 100.

First of all, congratulations on that accomplishment, that was fantastic. What did you take away from that program about yourself and about leveraging LinkedIn as a platform to help grow your business?

[0:37:57.2] MF: Thank you, Tim, for the congratulations. That was probably one of my most exciting accomplishments of last year. I was literally in tears when I got the email that I got into the program and I do also have to shoutout Brian Fung, who was the one and only other pharmacist in the first 100 with me, so we had a great time. I think the most important thing that we took away from that experience was how important it is to really be intentional about the content and the information that you’re creating not just on LinkedIn but online in general.

That might sound odd because as a health content writer, that’s exactly what I do but I think the most important part here is thinking about there’s always an audience that you are sharing information to. If you are ever creating any content whether it’s health content or social content or anything, if you are creating that just for you, then you are really missing an opportunity to connect with the people who are following you and watching you and listening to you.

Because they often times have different perceptions, leads, preconceived notions than you do and so, whenever you’re creating content, this applies to health content writing as well, you really have to be less focused on what you think and what you already know and really dive into what your audience thinks, what they do and don’t know so that you can create that content in a way that helps address their questions and helps solve their problems as accurately as possible.

You are not necessarily a reflection of the people who are trying to learn from you. If I were creating content on LinkedIn just for me, I would be going over the heads of so many people because I’ve been a content writer for five years. There are people, pharmacists who are coming across my account who have literally never heard of health content writing before. Students that I’ve worked with are like, “I did not know what this was until I saw your post.”

If I am not keeping that in mind and really trying to get a sense of where people are, then I am missing the point and the same holds true for any type of content that you are creating for any reason, paying attention to what your audience thinks and what they need.

[0:40:17.9] TU: I hope, folks, if they are not already following you on LinkedIn, they’ll be able to see that in action, so I hope they will. We’ll link to that in the show notes, Megan N. Freeland on LinkedIn. All right, my last question here for you, Megan, you had a post on LinkedIn recently that caught my attention and I didn’t prep you for this question, so this is going to be a discussion but you said:

“When you’ve worked so hard to get to a certain point, people may tell you to just be grateful that you’ve made it there. The sentiment implies that asking for anything more is mere greed. To that I say, don’t you dare dim your light for anyone else’s comfort. You can be grateful for your journey without having to stay there. We are all allowed to grow, mature, and evolve. Going after the career you want and the life you desire is not selfish, it’s your right and most importantly, it is within your power to do.” Tell us more.

[0:41:10.0] MF: Okay, hearing that read back to me that kind of got me in the heart a little bit. This kind of goes back to what I alluded to before about trusting yourself and recognizing that people might have your best interest at heart, or they might think that they do but they will also set limitations on you based on what they think is possible and what they think is fair and what they think is possible for them to do.

Sometimes, when you’ve worked really hard to achieve this goal, let’s say the goal is just graduating from pharmacy school, that might have been an expectation that either people didn’t have for you or people don’t have for themselves and so when you get to that point and if you turn around and realize, “I am proud of myself and I am glad that I accomplished this goal but I don’t feel completely settled” right?

I still feel like there’s something out there more for me, I still feel like maybe I am not in the exact place that I should be, maybe I’m close but maybe I’m not quite there, if you express that feeling to people, there are people who might say, “What are you talking about? You’re a pharmacist, you graduated, you should be grateful. I am over here doing XYZ, that’s not as cool as being a pharmacist, you have nothing to complain about” and that’s not about you.

That type of response is not about you, that’s about them and so my advice to anyone in this situation is your life is not anyone else’s. Your life is your own, no one else is responsible for what you do. No one else has to live with your decisions or your choices and so, regardless of how people respond to your discomfort or your feelings of unfulfillment or whatever it is, know that you are deserving of having the professional trajectory, having the life, having the career, having the whatever that you decide you want.

That’s within your control, that’s within your power and frankly, it is not for anyone else to comment on at all but if you say it to people, they will comment but just keep in mind that you determine all of that stuff. You determine the trajectory and you don’t have to feel guilty about that because it’s your life and you’re the only person who’s responsible for it.

[0:43:27.2] TU: So powerful, Megan, great said. It reminds me of a couple books I read and reread recently that I’d highly recommend, The Four Agreements, is one and the second one is, The Big Leap by Gay Hendricks. We’ll link to those in the show notes but those, both of those books get exactly to what you just shared there and that is so important for other people to hear especially for folks that are out there creating, putting content, stepping out in non-traditional ways like if you don’t work through that individual, everything you just shared there, it can be a very painful journey.

I think for folks to really realize what is their full opportunity but are their goals not what is the outside noise but what is their full opportunity, what are their goals and can they really lean into that is such encouraging words. Well, this has been a lot of fun and I am so grateful that you have taken time to come on the show. Where is the best place that folks can go to follow your work and learn more about what you’re doing?

[0:44:17.6] MF: Thank you for having me, Tim. This was a wonderful conversation. It’s been a while since I did a podcast, so I thought I was going to be a little rusty, but you made it really smooth, so I appreciate you. The best way to reach out to me is really via LinkedIn, we’ve talked about LinkedIn a lot, I am on there every day. So if you listen to this episode and you want to learn more about health content writing or you just want to say hey or you want to ask follow-up questions about anything Tim and I talked here, just find me on LinkedIn and shoot me a message. I love having conversations with folks there, so that is how you can reach me best and I look forward to chatting with you.

[0:44:51.7] TU: Great stuff, thank you so much, Megan, for taking the time to come on the show. We really appreciate it.

[0:44:55.1] MF: Thank you, Tim.

[END OF INTERVIEW]

[0:44:56.7] TU: Before we wrap up today’s show, let’s hear an important message from our sponsor, Insuring Income. If you are in the market to add own occupation disability insurance, term life insurance or both, Insuring Income would love to be your resource. Insuring Income has relationships with all of the high quality disability insurance and life insurance carriers you should be considering and can help you design coverage to best protect you and your family.

[DISCLAIMER]

[0:45:32.9] 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 it is not intended to provide and should not be relied on for investment or any other advice. Information of 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.

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 258: How Much Home Can You Afford?

Posted on June 2, 2022November 2, 2022 by yfpadmin

How Much Home Can You Afford?

On this episode, sponsored by First Horizon, Tony Umholtz talks through how to determine how much home you can afford.

About Today’s Guest

Tony Umholtz 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.

Episode Summary

In this episode of the Your Financial Pharmacist podcast, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, is joined by Tony Umholtz, a mortgage manager at First Horizon. Tony has years of experience working with pharmacists all over the country in securing home loans. In this episode, Tim and Tony kick off the discussion by looking at how the real estate market has changed recently and why we are currently in a seller’s market. Tim and Tony discuss rate hikes and inflation, the 28-36 rule, and what that means for a pharmacist as a potential home buyer. Next, they dive into the many factors banks consider when someone applies for a home loan and which are the most important. Tony shares how each home loan situation is different and dependent on individual circumstances. He also discusses insurance and how you can make better choices to save in that area. Then, Tim and Tony dig into the area of tax and how it differs from state to state. Tony shares a brief overview of the First Horizon pharmacist home loan product, the challenges pharmacists may face with this product, and the benefits it can provide for a pharmacist, whether fully qualified and earning a full income or not.

Key Points From This Episode

An overview of today’s guest, Tony Umholtz.
How the real estate purchase market has not slowed down but refinancing has.
Why we are in a seller’s market.
What rate hikes mean and the impact they have on mortgage rates.
The impact inflation will have on rates.
Why locking as soon as possible is preferable when purchasing a home.
What the 28-36 rule is.
What banks consider when you apply for a home loan and what factors are more important.
How the appraisal gap affects the market.
The importance of considering expenses, fixed and variable, other than the loan.
How insurance changes depending on what part of the USA you are in.
The danger of over-committing to personal property insurance.
The effect of property value on tax and how that changes from state to state.
An overview of the pharmacist home loan product Tony offers through First Horizon.

Highlights

“The most important [factor] is the ability to repay [your loans.]” — Tony Umholtz [0:10:57]

“Just because the bank says you can afford this, doesn’t mean it’s right for you.” — Tony Umholtz [0:11:24]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

This week, I had a chance to welcome back on to the show, Tony Umholtz, a mortgage manager for First Horizon, formerly IBERIABANK. During the interview, Tony and I talk through how to determine how much home you can afford, a timely topic, considering the seller’s market we’re in and the rising interest rates that are driving up the cost of owning a home.

During the show, we talk about the current state of the market, interest rates, and trends Tony has seen through his experiences working with pharmacists across the country. We discuss what formulas lenders use to determine the amount of home they will allow one to purchase, why you and not the bank should establish the budget for buying a home, and we also discuss the total cost of owning a home and things to consider beyond the purchase price.

Before we hear from today’s sponsor and then 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 240 households in 40 plus states. YFP planning offers free only, high-touch financial planning that is customized for the pharmacy professional.

Okay, let’s hear from today’s sponsor and then we’ll jump into my interview with Tony.

[SPONSOR MESSAGE]

[0:01:36.2] TU: Does saving 20 percent for a down payment on a home feel 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 percent for a down payment on a home may take years.

We’ve been on the hunt for a solution for pharmacists that are ready to purchase a home with a lower down payment and are happy to have found that option with First Horizon, previously IBERIABANK/First Horizon.

First Horizon offers a professional home loan option, AKA, a doctor or pharmacist home loan that requires a 3 percent down payment for a single-family home or townhome. Has no PMI and offers a 30-year fixed-rate mortgage on home loans up to $647,200.

The pharmacist home loan is available on 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 preapproval process, visit yourfinancialpharmacist.com/home-loan. Again, that is yourfinancialpharmacist.com/home-loan.

[INTERVIEW]

[0:02:41.9] TU1: Tony, welcome back to the show.

[0:02:45.3] TU2: Tim, good to be here with you.

[0:02:47.3] TU1: So, we had you last on this show on episode 245 when we talked about getting under contract in a competitive home market. Interest rates at that time were starting to creep a little bit back in March but they have certainly jumped significantly since then. So with interest rates on the rise, Tony, are things slowing down at all in this market?

[0:03:08.6] TU2: You know, it’s interesting Tim, the purchase market has not slowed down, it’s still very healthy. Refinances have, we’ve definitely seen a pullback in refinances are some cash-out refinances where people are taking advantage of their equity position and then something called a delayed cash out because there seems like there’s a lot of people that have money to pay cash for houses so they’re actually coming back to do what’s called delayed cash out. So we’ve been seeing some of those but on average, the refinance are way down as you can imagine with rates coming up.

[0:03:39.5] TU1: Yeah, it wasn’t too long ago you and I were talking about refinancing back at the beginning of the pandemic when rates were in the high twos and low three. Obviously, we’re at a very different point in place but at the end of the day, we still have a supply issue so you know, we see rent prices that are skyrocketing, which I suspect is further in individuals to want to get a new home, supply and demand.

So it feels like, despite the rate hikes that are happening, you know, recently it feels like for the home buyer, unfortunately, they’re still going to be in a very competitive market that is the seller’s market. Is that what you’re saying as well?

[0:04:11.8] TU2: Yeah, absolutely, Tim. I mean, every market’s different as we’ve discussed but on average, most markets are just not – they don’t have enough inventory and I think clearly, that’s going to push prices higher and if you’re renting and you could go pay equivalent of your rent or even less buying a home and you get appreciation. I think that’s why we have such demands. So yeah, there’s no season and demand out there that I’ve seen so far.

[0:04:36.8] TU1: Tony, I want to pick your brain for a minute, you know, the day we’re recording this, we’re expecting news today of the Fed to hike interest rates, I think we’re expecting 50 basis points, a half a percent but you know, awaiting that news and so is the stock market to see what happens.

But I always appreciate your perspective economically on what these types of Fed rate hikes mean and the impact that he may have on mortgage rates. So as you’re expecting this news to come up today, whether it’s 50 basis points or it ends up being something a little bit different than that, what are the potential implications that we should be looking for?

[0:05:09.9] TU2: Great question. I mean, the timing is a couple of hours here we’re going to get the announcement but the biggest thing is that the rates have run up so much this year since January, without the fed doing much of anything yet, right? It’s just been talk, it’s been kind of projections and they did raise a quarter already on the Fed funds rate and right now, the outlook is 50 basis points today.

It could be 76, it might shock the market but let’s say, it’s 50. Really, that’s not what I’m pinpointing as the issue for mortgage rates. It’s not going to be the front end of the curve so that front end of the curve, what we call the fed funds rate is going to affect your credit card rates, your home equity line rates, maybe some auto loans, floating rates, rates that are floating rates on the market. But long-term mortgage rates are more going to be influenced by what the fed says about balance sheet reduction.

Basically during the last couple of years, during the pandemic, they were helping stimulate the economy by basically buying bonds, being the biggest buyer of bonds, mortgage bonds, the treasury bonds and that helped push rates lower. So essentially, that runoff of their balance sheet adds supply to the bond market so that affects rates and it’s going to affect the stock market too I would think but that’s going to be what I’m watching the most for rates, you know, long-term rates and how to advice my clients.

I mean, I’ve been in a complete locking bias since the beginning of the year. I’ve had very few clients that wanted to float but my opinion’s always been lock as soon as you can and I think, today’s going to be, you know, we’ll learn more about the outlook here and what the fed’s going to do. You never want to fight the fed in what you do and the one thing I would say too is, inflation is the thing we have to watch for rates as well.

If we get any sort of ease and inflation, that can spark a new trend of rates, maybe easing a little bit, maybe capping. So those are the things I’m going to be looking for today, Tim.

[0:07:07.1] TU1: Yeah, and as you and I talk before the – we hit record, if we do find ourselves in a mild type of recession or recessionary period, we would expect the rates to come back down which could have implications as well so certainly, we’re in a volatile time period and to your comment, in case folks aren’t familiar with that terminology in terms of rate locking versus floating.

You know, in time periods where we may be expecting a reduction in rates, perhaps something like a float matters but you know, to your point, this year, as we’ve been expecting rates to go up, locking as soon as possible typically seems to be in someone’s advantage as a look they are looking to purchasing a home.

So today, what we’re talking about is how to determine how much one can afford when it comes to home buying and I think this is a really timely topic ass we’ve painted a picture so far. We’re in a seller’s market, we got rising interests rates which of course means more to the home buyer.

We also see that there’s more and more that’s out there in terms of the average loan size. So perhaps someone depending on the part of the country they were living in, you know, maybe a couple of years ago they were looking at a home that was selling at 400,000 and easily that may be north of 500,000, obviously, very different depending on the market.

So escalating home prices, rising interest rates means affordability of home, it’s certainly a timely topic and as we’re often talking about, we need to be considering how this home purchase and how the cost of the home fits in with the rest of the financial plan and the goals that someone is trying to achieve.

So Tony, let’s start with how the bank determines how much they’re willing to lend to an individual? So does the 28-36 rule stilly apply and first, if you could define what that is and talk to us about how that is determined in terms of what one is willing to lend from the institutions?

[0:08:51.1] TU2: Sure, yeah, sure. So the 28-36 rule has been around a long time. It’s a little different nowadays, we look at the multitude of factors which is to kind of go back to define what that is. Basically, the 28 percent is the amount of your monthly income that can be for a housing payment, okay? So basically, we’ll try to make it as simple as we can so let’s say you had a $10,000 a month gross income, the definition would be okay, so $2,800 can be allocated to a housing expense, okay?

Now, that is not how it’s underwritten today but historically, that was something that we looked at. It’s still looked at to some degree but we look at it a little bit differently now. It’s more your total debt, right? Your total debt ratio and that’s with a 36 percent looked at so they’d say, “Well, if you make 10,000 a month gross income, we could allocate $3,600 a month to debt” so that might be your housing expense, your car loan, credit cards.

One thing that banks do not look at is like, your auto insurance, cellphone bills, we typically don’t look at any of that in your expenses, it’s just creditor debt. So credit cards, student loans, things like that. So historically, that was a metric, especially when we did FHA loans years ago but nowadays, it’s more viewed on the total debt ratio. So we typically like to stay at 43 percent of your total debt or better.

That could be like, if you have no debt and you have a $10,000 a month gross income, household income and you are buying a home that requires a $4,300 a month payment. So that’s your total payment, it’s your principal interest, taxes, and assurance, you could still qualify because you have no other debts, right? So that’s going to be a fairly large house but you could still qualify given that there’s metrics. So that’s kind of the significance of it.

So these are called debt to income ratios is what the terminology is and that’s a very important metric for lenders. In fact, it’s one of the most important metrics. Like credit score obviously is important, reserves can be in certain products but the most important is the ability to repay. Banks are required by law to prove that.

That’s why income, if anyone’s gotten a loan anytime in the recent future, at least in the last 10 years in the recent past is you had to give a lot of documentation to the lender because we have to document the income because we have to prove you have the ability to repay. It’s called the ATR rule, so that’s the reason for these ratios.

Just because the bank says you can afford this, doesn’t mean it’s right for you, you know? So, everybody’s different, everyone’s situation is different, so it doesn’t mean it’s right for you. Now, the other side of it too and I’ll mention this is depending on the product, depending on the individual, we can go up to higher debt to income ratios, above 43 and that’s generally when you’re putting 20 percent down and you have a compensating factor.

So we do see that as well, that does occur as well. I know it’s kind of a broad scope but I wanted to kind of include because everyone’s situation is different. It’s not like a one size fits all.

[0:12:03.2] TU1: Yeah and that’s great, Tony, because I think for many pharmacists, even the numbers you use, so $10,000 a month of gross income, you know, pharmacists, you divide that by 1,200, $120,000 a year, pretty close to what we thread that comes to a national average and obviously people can do the math if there’s more than one income but I think that’s a good point of reference.

Just to reiterate what you said, you’re talking there about when we were refer to percentage that can be allocated in the housing expenses, we’re referring to the principle interest taxes and insurance, which is important. So folks are looking on Zillow or Red Fin or Realtor, we’re looking at homes that they’re looking at all those expenses that would be combined.

I want to come back Tony, and just dig a little bit deeper, you know, you mentioned a few things, if I heard you correctly that that will factor into this decision whether it’s a number lower than 43 percent or perhaps higher than 43 percent You mentioned down payment and the amount that’s down, you mention reserves. I heard you mention credit score as well.

So talk to us more about, in addition to just the income that one is making or obviously you have to produce W2s or income source as a part of the lending application, how do those other things factor in? So if I’m someone that’s got substantial reserves and I can bring more down but perhaps I don’t have as high of a credit score like how will that impact or do some of these weigh more heavily than others?

[0:13:20.5] TU2: It does. I mean, there’s different types of products out there so everything, there is different programs we have, different loan sizes, all sorts of things, so everyone’s different. So for example, we have loans for lower credit score, people with lower credit scores. I mean, FHA loans for example, which is a government backed loan, we can get pretty low credit scores approved for that with just three and a half percent down.

Now, there is high PMI with those loans, right? There’s very high PMI and then rates can be affected by your credit scores as well and then, we have loans for people that have lots of money and don’t show income, which is fairly common with business owners, right? They have sold the business or I had a couple of pro-athletes that I’ve worked with over the years that in between contracts and they’ve made a lot of money but they don’t have an employer right now.

So and there’s programs available for them. So not to get into too much of the granular but there is different options out there for different people. I would say the key though is the ability to repay. So it’s hard to say now, for example, the product we offer to pharmacist, we have minimum credit score of 700. I really can’t deviate from that because that’s a program guideline for that particular product but a conventional loan through Fannie Mae and Freddie Mac has, I mean, I can go down and do a 620-credit score with that which is pretty low.

But if your rates are going to be affected by that, you’re going to – may have to put more down than you would like to and there is going to be a give and take. So it’s viewed a little differently, depending on situations.

[0:14:50.4] TU1: Yeah and I think you just highlighted there why this is not a cookie-cutter approach, right? I mean, everyone’s credit situation’s going to be different or income’s going to be different, obviously, the area in which they’re buying a home is going to be different, what to bring down, the reserves, the type of loan product name to pursue could be different so I think really have any good understanding of those and working with a wonder that can walk you through those really important, because it needs to be a custom decision to your personal situation.

Tony, I want to talk for a moment, you mentioned obviously the idea that yes, you know, what the bank approves is one variable but also, you know, that may or may not mean that it fits in with the other financial goals and I think that’s really important but you and I have talked about this before in the show but the bank isn’t’ considering one’s list of financial goals in the home buying decision, right? They may not be thinking about, “Well, are you on track for retirement or are you not? You know, how are we addressing the student loan repayment plan?”

So obviously is a part of the broader financial plan, we need to be thinking about that overall monthly budget, that overall housing expense and how that fits in and allows us or does not allow us to be able to progress and achieve with other financial goals. So again, we’re going to have to play by the rules of the bank of course but ultimately, we need to be setting our own budget. So with that in mind, I want to talk through other costs that folks need to consider.

So we mentioned already principle, interests, taxes and insurance. So those are four things that we need to be thinking about but in this market that we’re in right now, one of the things that I’m going to talk about is just the amount that someone might have to be bringing to the table and yes, down payment is going to be one part of that but I know in our area, we’re seeing a lot of waving of appraisal gaps which could mean that more cash needs to be brought to the table by the buyer.

So can you talk to us about what is that in terms of the appraisal gap waver and why we’re seeing that play out in the market that it is and how that can obviously impact how much money somebody has to bring to the table.

[0:16:46.6] TU2: Yeah, absolutely. So, let’s address that and we could talk a little bit more about how things may evolve here but I think the appraisal gap, you know, we’re still seeing that in many markets around the country. I mean, there’s a lot of high demand markets and we haven’t built enough homes the last 10 to 15 years, so that’s why we’re in this position that we’re in and builders can’t keep up with because of obviously the tight supply chain, it’s taking longer to build and it’s harder to build.

So the appraisal gap is tricky because, if you agree to this, right? I’m going to bring this, you basically, have to have the catch, right? To fill the gap, so if the price of the home is $400,000 and you have this waver and it appraises for 350, well, the bank’s going to use a 350, right? 350 value. The lender has to uses the appraised value and you know, let’s say we’re going to lend you 5 percent down. It was a 400, now it’s 5 percent down and 350, so you’re putting 5 percent down off 350, plus, the 50,000 gap that you agreed to with the seller.

So you really have to plan ahead and look at how much cash you have if you agree to that situation. Now sometimes, it will appraise in that you don’t know, it may come in okay but I would definitely heed your realtor’s advice if they think they may not, right? Because there could be a change. You know, one of the things that we’re looking and at every market’s different so you can’t speak to every single city in the country but on average, there’s a lot of this happening around the country but a little bit of a pause with help, right?

I think if we could get, you know, instead of seeing double-digit price increases for homes, if we got mid-single digits would be healthy right? You know, if you got a 5 percent, 6 percent appreciation on your home and you are putting 5 percent down, you’re getting an unbelievable return on your money and you are getting – you are not in such a bidding war crisis that we’re in now but I am hoping that will kind of happen and will normalize a little bit.

But I would just be really careful about what you agreed to when you are buying now. I am very cautious about waving inspections and things like that. I just think if you can get anything in, plugged in, it just protects you and you have your eyes open and if there is, if you have to agree to something like a waiver, just make sure you have enough time to get your inspections done so you know every – at least you know the house is in good shape.

There is nothing to worry about there and if there is a little bit of a value change then I hate to say it, but the reason you are agreeing to that is there’s other buyers out there waiting to buy it too. So there is going to be a lot of demand for real estate for quite some time until you see inventory levels rise.

[0:19:23.6] TU1: Yeah and I think that’s the concern, right? You’re set and done, I am not in the market you know, for a home in the moment but especially for first time home buyers it’s an exciting, it’s an emotional process and in a seller’s market where we are seeing a lot of bidding wars, I think there is just caution that we need to use when you look at waiving appraisal gaps, waiving of inspections and some of that as well because ultimately again, you know as we talk about often on the show, you know home buying is a really important part of the financial plan but it is one piece of the puzzle, right?

So we got to make sure that we can enter that home, we can enter that situation with confidence that we’re able to move our other financial goals forward. We were just talking before the show, I mentioned that Tim Baker and I were looking at property here in the area that it was listed around 530 and it ended up selling for an all cash offer at 650 and that was an example where appraisal is going to come in around that 530 points.

So that means in that case, that’s someone is going to be bringing in over a $100,000 of cash to the table. So that is another thing is we talk about affordability of home, if you find yourself in that position even if it’s a smaller amount, right? Five or $10,000, we got to factor that in on top of the down payment and on top of the other expenses that relate to purchasing that home.

[0:20:39.8] TU2: Absolutely. You have to run your numbers on your reserves and how much cash you have if you agree to something to that effect.

[0:20:46.8] TU1: Tony, I think it’s interesting the trickledown effect of this economically, right? We’re seeing rent prices here in Columbus, which I think is happening nationwide are going through the roof and obviously that presents a challenge for many folks. The other thing I am seeing recently, actually I heard an ad this morning, it was a window company here in Columbus that was running an ad basically playing on this saying, “Hey, instead of moving because of the market that we’re in, now is a great time to upgrade your home” right?

So you know, I think that we’re seeing this rising level of cost, some people are thinking about making an upgrade or finishes to their home, windows, remodel their kitchens, basements, whatever and again with the supply chain issues, I mean it is really hitting people I think in all different areas. So certainly a challenging time and yes, there’s appreciation there but having to see that offset by some cash flow pinches that can happen in the moment.

[0:21:34.9] TU2: Right, yeah absolutely.

[0:21:37.1] TU1: Tony, I want to go a little bit deeper into, you know, we talked about principle interest taxes and insurance. So again, as we think about affordability of the home, we talked about the percent down and that may need to be more because of the market that we’re in especially, we find ourselves in a waving of an appraisal gap situation and so the other thing I want to hit on here is that assuming somebody chooses a fixed loan and we’ll talk about the pharmacist home loan product here in a moment.

You know, that principle and interest is going to be fixed over the life of the loan but one of the things that they need to consider and I’ve lived this firsthand is that taxes and insurance are not fixed, right? So we need to be thinking also about what is variable going into the future and I don’t know markets where taxes are going down. So our taxes are going up, my home owner’s insurance has gone up overtime.

So you know, hopefully, we have income increases that will go up overtime but we’re not always seeing that for pharmacists. So we need to be thinking about other expenses that could rise overtime and it’s not just in this moment, what’s the percentage of my take home pay that I am going to allocate to my home but how might that go up overtime as taxes increases, an insurance increases and then obviously, there’s other things to consider like HOA fees or upkeep or maintenance of the property.

All types of things that again, home investment is a great thing but we want to make sure that we are entering into that with financial confidence.

[0:22:59.3] TU2: Absolutely and that is a really good point. I mean so let’s say, we obviously fixed the rating, we fixed the payments in for principle and interest on the note but there is that variable nature of taxes and insurance and depending on what part of the country you live in, insurance can move quite a bit. If you are in Southern Texas or Florida, taxes or insurance can be a wild card sometimes.

But I would say this, I mean, I think it’s important that you check on insurance maybe every year, right? Whether it is your auto insurance and the home owners, just see what’s out there because there is new carriers coming to market and sometimes they will give you discounts for your policies and one other thing too that I see banks and mortgage companies require a certain amount of coverage.

That way your house is covered if it were to burn down or tornado damage or whatever it might be but one thing I do see, sometimes people overcommit on personal property. So make sure your insuring what you need. If you have a lot of personal property, clearly you can make sure you have the coverage but lenders don’t care about that. You could put it to zero and that wouldn’t be an issue for a lender.

So if you are really trying to reduce your cost, that’s one way to do it too is look at like the personal property terms in your insurance policy and your house insurance policy.

[0:24:15.0] TU1: That is a great call Tony. I would encourage folks if they haven’t done this in a while, you mentioned kind of looking at this regularly and even just pulling out the policy and looking at the line items, making sure you understand what those things are and I went through this recently. One of the challenges out there if you are trying to shop around policies is getting the apples-to-apples comparison.

So what I found to be helpful was as I was getting policy quotes, I basically provided the coverage amounts based on my current policy and what the categories were to try to get as close of a comparison as I possibly could and then that’s also true on auto insurance as you are looking at different carriers and options but great suggestion, a reminder to make sure that we’re taking a fresh look at that over time.

[0:24:54.9] TU2: Yeah and I think that could help maybe to some degree alleviate some of that movement but clearly over time insurance costs are going to go up, especially with inflation. You know that’s affecting insurance premiums because it costs more to replace property, right? So that’s going to affect the cost of insurance. Property taxes, you know with property values going up overtime, in some states they’re capped, in some states they’re not, right?

So you have – we got to be careful about this too Tim because every place is different but like for example in Florida, you have the homestead exemption and the save our homes cap, which essentially caps how much your tax basis value can go up every year and that really helps preserve the tax that you are paying every year. It can only go up a little bit so it is not a big deal in owner-occupied homes.

Now, if it is not owner-occupied, second home investment property, it’s free lunch basically. You know the county could do whatever it needs to do but every place is a little bit different. Some other states have similar measures and that can help kind of keep in check how much your taxes go up every year and generally taxes are going to rise with the property values increasing.

Now, the flipside is, I remember in ’08 and ’09 when my property values went down, my taxes went down, which is – you know, that was one benefit I guess of that side although I don’t want to relive it but you know that was a – you know, taxes generally go down if the county assesses your property at a lower amount and the other thing that I find too is that many of the municipalities are very, very generous in how they value your property.

Because I will see some of the tax bills and they are coming in well under the market value and their tax estimate is well under. So it may not be the same everywhere in the country and every state has different varying degrees of taxes. So I’ll just say one thing like our audience in New York, taxes are really high there, right? Even in Florida, they’re pretty high but you know I have seen some other states where they’re not bad at all. So just different states can vary on how much those taxes are.

[0:26:50.9] TU1: Good call out Tony that it is different everywhere as well as obviously there is a situation where it may go down and I am coming from the bias of only living in a period I’ve bought my first home in 2009 and you know, didn’t have a home when that happened and events were all fine.

[0:27:06.5] TU2: You bought at a good time.

[0:27:08.0] TU1: Yeah, that’s right. I’ve been spoiled by only living in a state of appreciation on the home side. So I want to shift gears and talk about the pharmacist home loan product that you offer through First Horizon. You know, anytime we do a webinar presentation that includes home buying Tony, this continues to be the most common question, the number of questions I get in terms of volume around the pharmacist home loan product.

I think it is becoming even more timely, it’s always been timely but more timely because as we see a rise in the purchase price, if folks are thinking, “Do I need 20 percent down?” or something traditional like that obviously, that becomes more of a barrier as the market does what it’s doing. So talk to us about the pharmacist home loan product offered by First Horizon. You already mentioned the minimum credit score of 700, who is this for? Who is not for? What does it mean in terms of down payment, purchase price of a home? Give us the overview.

[0:28:02.2] TU2: So as we discussed, 700 is that minimum credit score. You know clearly, you have to be a licensed pharmacist. We couldn’t give it to just anybody. You know, some of the attributes of the product is you just don’t have to put much down and if you are a first-time home buyer, you are looking at putting 3 percent down. You’re eligible to put 3 percent down. If you have owned before, you only have to put 5 percent down.

There is no mortgage insurance, so that is a really big driver to benefit as you have no MI and I find that with 5 percent down, the rates are every bit as good as someone came to me that was not a pharmacist for 20 percent down and sometimes better actually, an eighth better. So you get it sometimes a little bit better rate as well and the waiver of the PMI is a big thing. There is a loan cap, those ties-wise.

We won’t go above 647, 200 as far as loan size. I have had a lot of pharmacists come to me with purchase prices of like 680 and they put 5 percent down and they’re fine. You know, they are within that guidelines there. So it still gives you a good bandwidth of price but sometimes in more expensive markets like California, it can be tougher sometimes to meet that guideline. We only offer a 30-year fixed on the product.

So it is a 30-year fixed only, which I find is popular and then the other thing that’s a nice feature is there is no reserve requirement. You know, a lot of programs like this require that you have six months reserves for loans for specialist and this one does not have that and that’s a nice thing, no prepayment penalties. So it is a very clean loan. It doesn’t have a lot of concerns about it.

The other thing too is generally with student loans, it will use a lower factor than a normal conventional loan will if you don’t have an income base repayment plan in place already.

[0:29:46.3] TU1: Okay.

[0:29:46.9] TU2: So if we don’t know what your payments are, it will actually use a lower factor than like if we were to get it through Fannie Mae or something to that effect or FHA. That’s another attribute. I’ve noticed though Tim, most of the pharmacists that are applying, we’ve had a lot this year, a lot in the last few years seemed to have a payment in place. There is only a few here and there that don’t.

Yeah, so I find that kind of income base repayment is usually the driver or we just get a letter of what the payments are going to be and that tends to be the best way to handle things because those payments are generally a fraction of the balance now.

[0:30:20.9] TU1: That was my question Tony, you beat me to it especially because we’re still in this Federal administrative forbearance where there’s been a price on Federal loan payments now for over two years that’s going to continue through the end of August, if not extended further. So for folks that are listening that I would suspect many are not making payments, is that the case then you kind of projected out what the payment would be?

[0:30:39.9] TU2: Normally that’s the best way if they have an expense, a challenge, you know, if it’s close qualifying otherwise we use a factor of the balances that can sometimes cause the debt ratios to get out of line but sometimes it’s fine. So we use that factor too sometimes if there is not a payment being made but normally we just get that letter projecting what the payments will be and I found that that’s normally what we see.

But most people that come to us are already in that position but not everyone. We do have some that we use the factor onto.

[0:31:08.9] TU1: The most common question I get is, “Hey, tell me more what is the pharmacy home loan product? Why is it different, why might it be an advantage?” you obviously highlighted the points there. The second most common question I get, which you already addressed is, “Hey, that all sounds great but am I going to pay a higher rate?” and you kind of alluded to of course, for everyone’s situation it’s different.

But given the minimum credit threshold of 700 here and depending on the percent down, you know certainly it sounds like it can be competitive, in some cases it could be better. The third question I often get is, “Hey Tim, I am a resident. I am a fellow, I am a pharmacist but I am not yet earning that full income and so is this product eligible for me?” and I think, correct me if I am wrong, I think the answer is yes, you’re a pharmacist but you’re obviously going to run into some potential issues with that percentages because of that lower-income, is that correct?

[0:31:56.7] TU2: Yeah, that is going to be a real challenge to buy that level. You know, we typically because the income level is not where it needs to be unless you’re married and your spouse is earning a good living already and whatever field they might be in and that can change things, you know? I’ve had where the spouses of PA, a physician assistant or an attorney and they’re having a good income stream while the pharmacist is in training that can be.

So everyone is different through our point Tim but yeah, that would be a case where that probably qualifying for a loan, they’d have the ability to do it in that case but normally I find it is better to kind of wait fpr your training and you have that state license where you are going to be practicing in place.

[0:32:37.4] TU1: Tony, knowing that we’re at the time of year, so those that are doing residency fellowship that are wrapping up, you know typically they’re ending end of June, so they’re in this transitionary phase and I suspect many might be listening. So for those that are making the transition out where they’re going to be going from a resident or fellow income to that full pharmacist income where obviously things will improve financially, general rules of thumb in terms of like how many months do we like to see from a lending perspective where they are in that higher income state, so they evaluate potential timing of a home purchase.

[0:33:08.6] TU2: Tim, really month one we could help them. If they have an agreement and they are getting a W2 income, month one, we can help them. So they could close in month one, so right out the gate, you know, in July 1st if that is their first day, they could close. So they’d have the ability to close right away. So this product is not quite as flexible as our doctor products, which we’ll create.

Sometimes they’ll go out like over five months if you have a contract and stuff like that from your start date but –

[0:33:38.1] TU1: Oh really? Before.

[0:33:39.5] TU2: Yeah but it’s a little different program. This one, it will still allow you to close on day one. So they really could get under contract knowing where they’re going to start and be able to close right when they transition in.

[0:33:52.9] TU1: Okay, let me point our listeners too, we’ve got a page. If you go to yourfinancialpharmacist.com/home-loan, we’ll link to that in the show notes. Again, yourfinancialpharmacist.com/home-loan. We have a lot of information, five steps to getting a home loan. We go into a lot more detail about what we talked about here today and then from there, you can get more information in terms of applying for the pharmacist home loan product and getting in touch with Tony as well.

So Tony, thank you so much. As always, always appreciate the conversation and the expertise that you bring to the YFP community. So thank you so much for joining.

[0:34:28.5] TU2: Thanks for having me Tim. It’s always good hanging out with you here so I enjoyed it. Thank you.

[0:34:32.5] TU1: Thanks Tony.

[END OF INTERVIEW]

[0:34:33.9] TU1: Before we wrap up today’s show, I want to again thank this week’s sponsor of Your Financial Pharmacist Podcast, First Horizon, previously IBERIABANK/ First Horizon. We’re glad to have found a solution for pharmacists that are unable to save 20 percent for a down payment on a home. A lot of pharmacists in the community have taken advantage of First Horizon’s pharmacist home loan; which requires a 3 percent down payment for a single-family home or a townhome 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 preapproval process, you can visit yourfinancialpharmacist.com/home-loan. Again, that’s yourfinancialpharmacist.com/home-loan.

[DISCLAIMER]

[0:35:14.3] TU1: 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 it is not intended to provide and should not be relied on for investment or any other advice. Information of 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 analysis 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 257: How This Pharmacist Helps Others Transform and Advance Their Practice to Have a Joyful Career

Posted on May 26, 2022November 2, 2022 by yfpadmin

How This Pharmacist Helps Others Transform and Advance Their Practice to Have a Joyful Career

In today’s episode, sponsored by Insuring Income, Dr. Kimber Boothe, PharmD, MHA talks about her career in health systems and the pharmaceutical industry, why she founded the Kimber Boothe Group, how she has monetized her expertise, and the lessons she’s learned from publishing her second book, ‘Pharmfluencers: The Inspiring Stories of Pharmacy Entrepreneurs.’

About Today’s Guest

Dr. Kimber Boothe, PharmD, MHA, is a pharmacist, healthcare leader, and entrepreneur with decades of experience in health systems and the pharmaceutical industry. Kimber is the founder and CEO of the Kimber Boothe Group where she helps pharmacists transform and advance practice to have a joyful engaging career.

She serves by providing coaching, consulting, and courses on:

Leadership & Career Development
Pharmacy Strategy & Innovation/Intrapreneurship
Pharmacy Entrepreneurship

She calls herself a Connector and a Pharmovator® and is the creator and author of several programs and books to guide pharmacists to success. CONNECTOR CORE™ is a program on the Connector Framework™ – Connectorability™, Connector Alignment™, Connector Foundation™, and Connector LIFE™. PHARMOVATION® is a course and system to Accelerate Your Pharmacy Career, Advocate for resources & Advance Pharmacy Practice, and PHARMFLUENCER™ is to Influence, Multiply, and Impact Pharmacy through Entrepreneurship.

Kimber previously led the pharmacy services for a four-hospital community health system where she drove innovative strategy for the pharmacy enterprise as the Chief Pharmacy Officer. She was also the Director of Clinical Pharmacy Services at Yale New Haven Health. She is a graduate of the University of Connecticut School of Pharmacy and Medical University of South Carolina College of Pharmacy, University of Phoenix Masters in Health Administration program, and completed residency training at Virginia Commonwealth University Medical College of Virginia Hospitals.

She is passionate about spending time on the right things to develop others and deliver strategic, focused results. Her motto is Pharmacy Can do More with More™ and her goal is to support the addition of 100 new health system pharmacy positions annually.

She is the recipient of the Connecticut Society of Health System Pharmacists Meritorious Achievement Award and her prior organization has been recognized with the Kentucky Society of Health System Pharmacists Innovative Health-System Pharmacy Practice Award.

Episode Summary

There are more methods to monetize your knowledge and expertise in the pharmacy industry than you think. All you have to do is pick one. In this episode, discussing the various options and sharing her personal pharmacy path from clinical roles to leadership and consulting is Dr. Kimber Boothe. Not only is Dr. Boothe the author of two books, Pharmovation: Advocate for Resources, Advance Pharmacy Practice, & Accelerate Your Pharmacy Career and Pharmfluencers: The Inspiring Stories of Pharmacy Entrepreneurs, but she’s also the founder of the Kimber Boothe Group, where she guides pharmacists towards a joyful, engaging, and lucrative career. Listeners will hear Dr. Boothe break down the differences between intrapreneurship and entrepreneurship and her experience with each. We discover the purpose behind her mission, learn about her personal growth goals as she moves from a solopreneur to filling staff positions and hear her thoughts on the importance of intentional career development. We also delve into the power of mindset with Dr. Boothe, who shares some actionable tips for shaping a positive mindset. Dr. Boothe also takes a moment to discuss the levels of relationships, types of coaching available to you as a pharmacist, and why she believes coaching is so important.

Key Points From This Episode

Dr. Boothe’s career path in pharmacy, from clinical roles to leadership and consulting.
Defining intrapreneurship versus entrepreneurship.
The pros of allowing for intrapreneurship within an organization.
Why Dr. Boothe believes pharmacy can do more with more.
The genesis of The Kimber Boothe Group and the problems it aims to solve.
Dr. Boothe’s growth goals.
The importance of being intentional about career development.
The purpose of Dr. Boothe’s book, Pharmfluencers, and the information it contains.
Ways to monetize your knowledge and expertise in the pharmacy industry.
The power of mindset and tips for shaping a positive mindset.
The four levels of relationships and why Dr. Boothe believes having a coach is critical.
Dr. Boothe’s transition from being a solopreneur to hiring and filling positions.

Highlights

“Intrapreneurship is the opportunity to be innovative at work within the safety and support of an organization. It’s basically that ability to do innovative things, but within that support where you have additional financial support. You don’t have the risk of having your own business.” — Kimber Boothe, PharmD, MHA [0:04:47]

“I’m really pro pharmacy. I want to advance the profession, whether it is through intrapreneurship or with entrepreneurs.” — Kimber Boothe, PharmD, MHA [0:27:51]

“Once you read [Pharmafluencers], you’re inspired. You can think through and find your ikigai, which is your passion and purpose, and tie that to something that can be monetized.” — Kimber Boothe, PharmD, MHA [0:31:59]

“Destiny is not a matter of chance. It is a matter of choice. There’s not a thing to be waited for. It is a thing to be achieved.” — Kimber Boothe, PharmD, MHA [0:37:16]

Links Mentioned in Today’s Episode

Episode Transcript

[INTRODUCTION]

[00:00:00] TU: Hey, everybody. Tim Ulbrich here. 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 chance to welcome pharmacy leader, influencer, and entrepreneur Dr. Kimber Boothe, to talk about her career in health systems in the pharmaceutical industry, why she founded the Kimber Boothe Group, where she helps pharmacists transform and advance practice to have a joyful, engaging career, how she has been able to monetize her expertise and the lessons that she learned from publishing her second book, Pharmfluencer: The Inspiring Stories of Pharmacy Entrepreneurs.

Before we hear from today’s sponsor and then 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 240 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, financial planning services are a good fit for you, know that we appreciate your support of this podcast and our mission to help pharmacies achieve financial freedom. Okay, let’s hear from today’s sponsor, and then we’ll jump into my interview with Kimber Boothe.

This week’s podcast episode is brought to you by Insuring Income. Insuring Income is your source for all things term, life insurance, and Own Occupation Disability Insurance. Insuring Income has a relationship with America’s top-rated Term life insurance and disability insurance company, so pharmacists like you can easily find the best solutions for your personal situation. To better serve you. Insuring Income reviews all applicable carriers in the marketplace for your desired coverage, support clients in all 50 states, and makes sure all of your questions get answered.

To get quotes and apply for Term life or disability insurance, see sample contracts from disability carriers or learn more about these topics. Visit insuringincome.com/yourfinancialpharmacist. Again that’s insuringincome.com/yourfinancialpharmacist.

[INTERVIEW]

[00:02:10] TU: Kimber. Welcome to the show.

[00:02:12] KB: Thank you, Tim. It’s great to be here.

[00:02:14] TU: So excited to have the opportunity to talk with you. Before we do a deep dive into the work that you’re doing today and much of your entrepreneurial journey as of late, talk to us about the path of your work in the pharmacy. Where that began, your interest in the profession as well as your career journey as a clinical specialist in the industry, and then as a health system leader?

[00:02:35] KB: Thank you, Tim. Well, I just, first of all, want to say that I do love our profession of pharmacy and I think, I want to thank you for everything you’re doing to support our profession’s financial health and support our innovation. I have had a wonderful career in pharmacy, starting mostly in hospitals and health systems and various clinical roles and as a cardiology specialist, moving up to leadership roles, ultimately into being assistant director, chief pharmacy officer for Community Health System, as well as being a director, system director of clinical services for an academic health system.

I also did spend ten years in the Pharma industry, so I had that experience, which I actually do owe a lot of my innovation and business savvy to the development I had in the Pharma industry where I did various roles in the medical affairs department. But was definitely drawn back to health systems, to what I referred to these days as my entrepreneurship activities, where I was promoting innovative practice, and bold strategic planning to advance pharmacy within an organization such as health systems.

[00:03:46] TU: Kim, I want to dive a little bit deeper on that, because I think there’s a lot of glorification that’s going on in entrepreneurship right now. We use that term a lot, and I think sometimes that can be interpreted as being synonymous with your own business or starting your own business, but entrepreneurship is a term where we’re starting to see grow, and I’m grateful for that. I think in the profession that term, I actually like a little bit more because I think it’s something that everyone can resonate with regardless of their role and the impact that they can have on the profession. So define for a moment what you mean by entrepreneurship and obviously, I think that’s something that we’re seeing. Lots of folks have opportunities within the profession that could be independent of owning their own business, right?

[00:04:26] KB: Absolutely. At the end of the day, entrepreneurship is wonderful. I know we’ll probably talk more about that as well, later on in this conversation, as I am now, what I like to call a full-time entrepreneur. But at the end of the day, most people are not going to be entrepreneurs, when you look at our total profession, 350,000 pharmacists in the US. intrapreneurship is that opportunity to be innovative at work within the safety and support of an organization. It is referred sometimes to as an entrepreneur on the job, or an entrepreneur in an organization. It’s basically that ability to do innovative things, but within that support where you have additional financial support, you don’t have the risk of having your own business.

That company is taking the risk, but there’s definitely some challenges because I know there are some organizations that are not open to these innovative ideas and you may not be able to implement something that you’re trying to do. But definitely the most successful organizations out there, whether they’re in health care or external to health care, those that allow for intrapreneurship’ to occur within their organization are more successful. Allowing the employees, team members to come up with ideas, allowing them time to work on those ideas while in the organization, helps their bottom line, helps them to be more successful, and ultimately to create more revenue for the company.

[00:06:00] TU: Yeah. I think that’s a great point. I mean, yes, it increases the bottom line increases of revenue, hopefully, pushes the innovation. I would argue also for the employee having that autonomy, having that space for creativity also probably ties to things like satisfaction in the workplace and retention and obviously can have a positive impact for employers as well, if they’re able to create that space to allow for entrepreneurship. Kimber, your motto is, “Pharmacy can do more with more with more.” What do you mean by that?

[00:06:30] KB: Well, I have to admit that definitely is my motto. Well, there is definitely times that we need to find efficiencies. I get very upset when I hear that phrase, do more with less. Yes, again, there’s times we can find efficiencies, use technology and be able to do more, but what I’ve seen in our profession is that we are underutilized and under-resourced for all of the massive amounts of unmet medication and health-related needs out there.

When I actually return to health systems after my ten years in PharmOn, I realized that the health system I was working at had grown immensely in terms of the number of patients, the number of services being provided, but the pharmacy team had really not grown in the same ratio. What I recognize is that we could be doing so much more, but we only had enough resources to focus on the most acute problems and whether that was on the acute care hospital side or even in the amateurish space where we had very few ambulatory pharmacists helping patients on an ongoing basis.

I came up with that motto and it’s definitely stuck with me and it’s really my mission and really why I left my intrapreneurship role to do entrepreneurship because my goal is to help create 100 new positions every year in pharmacy. When I think about some of the concerns that there is too many pharmacy students graduating, or when I look at the data and you really look at the unmet needs of complex medications, aging populations, clinician, physician shortages, I see a huge need for pharmacists.

Well, I don’t know the exact number of pharmacists we need. We definitely need more pharmacists practicing, but in different places than we are today, and also with different and better reimbursement models that value our overall benefit to health care and what I often referred to as the quadruple aim that we can help with improving the quality of care, we can improve the patient experience, we can improve provider satisfaction, and ultimately reduce costs by having more pharmacy team members.

The last thing I’ll say about it is, I often do the reason I say pharmacy can do more, not just pharmacists, is I definitely see a huge value of our pharmacy technician team members and have definitely advocate in for increasing their roles and as part of a true career for them, as well as, of course, integrating our students and optimizing more roles or creating more resonant positions. That’s why I often say pharmacy can do more with more, not just pharmacists.

[00:09:21] TU: Yeah. I love Kimber, your vision and an abundance mindset of creating new positions, right? 100 new positions in pharmacy each year. I wish we would see that adoption at a greater level among our national organizations and others because I think it really gets out of the conversation of, we only have so many jobs in this many graduates. What do we do? How do we increase the pie, right? How do we increase the pie and the opportunities that are out there? Which require, what we were just talking about a moment ago, that culture and spirit of intrapreneurship and entrepreneurship. So talk to us about the genesis of The Kimber Boothe Group. Your business and we’ll talk more about products and services here in a moment. But The Kimber Boothe Group, what problems or challenges did you face? What were you trying to remedy with this business?

[00:10:04] KB: Well, it’s interesting. When I first started the business really eight years ago, definitely as a side hustle, maybe many of your listeners are doing or considering doing. So at the time, actually when I started, I was actually still in Pharma at that time, and definitely, I had had multiple business ideas that all ended up in a file cabinet. So there was definitely a bug that I had around entrepreneurship but hadn’t found the right fit for me until I actually came across this thought leader, influencer model of an expert where it took away some of what I saw as barriers to a business like physical space products. It became about, what are you good at? What do people come to you for? What are you the expert in? How can you monetize that knowledge by sharing it with other people and helping them to grow, and becoming that multiplier to spread?

When I came across this expert’s model, that’s when I decided actually to create my business. I came up with a list of the things again that people naturally came to me for, the things that I was drawn to learning more about. It was definitely a lot about strategic planning, project management, and career development were the three main areas, both career development in terms of your professional development, but also being more assertive about your career trajectory and path. So that’s how I started. It was very general. I started to do some things on the side, some coaching.

I always to refer back to my first coaching client was an opera-singing soccer mom who just wanted some help to get back into opera singing and into the stage where she had to focus on her family for so long. We worked through that and she got on stage. So she was my first coaching client. From there it was a few years later that I actually went to the Medipreneurs Conference, which is an event that a few pharmacists had created, Anna Garrett, Sue Paul and Michelle Fritsch created that event. When I went to that event, I realized there that my passion is pharmacy, and that is where I had had definitely some success with doing some intrapreneurship business plans, justifying more positions.

I was being asked to speak by various organizations, conferences. I said, “Why am I trying to do this business very broad? I should be niching down or focusing my target to pharmacy.” Because I don’t mind helping soccer moms and things like that, but really, my passion is pharmacy. What I really wanted to do and connect those dots together was really focusing on helping the pharmacy profession to advance through sharing, again, similar topics. Strategic planning, project management, and career development were definitely a big part of that.

Back then, is when I created my Pharmovation course, which then turned into my Pharmovation book and the pharmovation consulting that I do for health systems which is where I spend most of my time these days, is actually helping organizations to write strategic plans, write those business plans that actually justify those additional positions.

[00:13:33] TU: For folks that are interested in learning more about what Kimber had shared of the influencer expert business model. She talks about it in her book, Pharmfluencers: The Inspiring Stories of Pharmacy Entrepreneurs. So more information there, I think that’s a great way for pharmacists to think about, especially what Kimber, or when I think about your career journey and the expertise that you have. I suspect many of the relationships in the network that you have, it makes a whole lot of sense that you’re doing some of that consulting.

If I heard you correctly you’re doing both on the business to business side, you’re consulting with health systems and organizations, helping them on a strategy leadership level, but then also you have a suite of services that are really on the business to consumer the B2C side for the individual being the courses, the coaching and the books. Is that correct?

[00:14:19] KB: Exactly, yes. I have what I call my product matrix of what I’m trying to support people with. Yeah, there’s definitely the consulting arm that focuses on the businesses themselves. I’m usually paid by director of pharmacy, usually. Then others, whether it’s individual coaching online courses or membership programs where people have opportunities for all of us to connect in a smaller group coaching atmosphere, both on the entrepreneurship side and the entrepreneurship side.

[00:14:53] TU: Could you break down a little bit further, Kim? You said you spent a vast majority of your time in consulting with the health system, roughly speaking certainly not share individual numbers, but roughly speaking on time spent or revenue of the business, if we think about this as a pie chart with your consulting to organizations, and then some of the coaching and the coursework that you’re doing with individuals or smaller groups as well as the books or other products. How would you break that down in terms of the different products and services that are within your business?

[00:15:21] KB: Yeah. That’s a very good question in terms of that breakdown and what it is now and what I wanted to be, I’ll share here. So right now it is more 90% of my time and 90% of my revenue is coming from consulting. That is that work and the other 10% is coming from the membership’s one-on-one coaching and other things like the summit programs that I’ve done. So that 90/10 a ratio, I’m definitely wanting to change that a little bit. I’m doing things like I have a full-time assistant and we’re trying to grow the online business through the membership basically, just because my time is limited.

If I want to be able to have more impact and reach more people, it’s not going to be through my one-on-one consulting. So I think the goal would be to grow that about to 40% of the business, 50 to 60% maintaining on the consulting side because I still think that’s vital for me. Having that integrated involvement with organizations is really helpful for me to grow and for me to really have the biggest impact, but I also know again, to reach more people and to get other people to write their own business plans so that we can create even more than 100 positions a year is definitely how I want to grow.

Again, moving towards more of a, almost a 50/50, but in this current year, my goal is to get to at least 80/20. So each year I have a goal to move that needle about 10%. Again, some of that is through growing my group membership that I have called the Connector Leadership Circle. Again that I can help more people at once and I can through, one-on-one coaching conversations or one to business consulting. I will share my other goal with growing is to add to my team. So I’m definitely talking with folks about doing some consulting with me, so I could potentially take on more consulting clients if I had a team. Right now it is just a team of one, right now.

While I have been asked by other consulting companies to become part of their firms, I’ve chosen to stay on my own, because of the flexibility, so I could focus on what I want with this ratio of services. Again, I recognize that organizations do need help. When I’m full on my consulting or my coaching clients and I can’t take anymore, well, how can I serve more? That would be adding to my team and them coming under the Kimber Boothe Group to do the consulting with me and as well as potentially some additional coaches.

I do recognize that people do come to me for my knowledge, but there’s a lot of people who have learned from me over the years and can teach and do what I’m doing. So it doesn’t have to be just about me. I think the last thing I’ll just share with that is when it comes to having a business, my current business coach, which of course I’ve always recommended having a coach throughout my career. I’ve either paid for myself or advocated through my organizations to have a coach. My current coach is definitely very focused business. What they say in that program, which is, it’s called Action Coach, and they follow very organized format for business owners, but their definition of a business owner is owning a business that can operate independently of you.

I definitely am not there yet, and I don’t know that I’ll ever want it to be that way. But if I want to leave a long-lasting legacy that is why I am exploring with my coach. What are these ways through adding to my consulting team or adding additional coaches, creating these membership programs where I can reach more people and it can become a little more independent. So that is my goal. I don’t think I ever started that way, though. I mean, honestly, that definition and that thought process is still pretty new, because when I did think of this thought leader model and when I did even think about what to call my business.

I called it my name because a lot of the people I was learning from back then, that’s what they did and then their products, so I brand my products and services and trademark them, but the business itself was me, but in this new mindset it won’t be me in the future at some point or it definitely will be a team. That is why it says group, not just Kimber Boothe, so that is part of that. So thanks for letting me share those thoughts.

[00:20:07] TU: No, I’m glad you did, because, because one of the things I always encourage folks as they have an idea that they’re passionate about. They want to pursue or they say, “I want to start my own business.” One of the things I’ll ask and encourage them is, what’s the goal? What do you want this to look like? What is the vision of that product or that service? But if we fast forward 20 to 30 to 40 years, is this a lifestyle business? Are you a solo entrepreneur? Do you envision a model where, as you mentioned, Kimber, by definition of sounds what the action coach program does that this can operate without you and therefore live on without you, which makes a whole lot of sense when you talk about this vision of really impacting and leaving a dent in the profession and growing positions, like scalability makes a whole lot of sense, right? Because there goes the impact that you can have and that could mean beyond your career that could mean time off that you have, but that other folks are helping to advance that mission.

That’s part of a couple of reasons why I wanted to dig in a little bit of behind the curtain of the business is, one I suspect that you may have many listed units and I am really interested in learning more about what Kimber is doing. You can find all this at kimberboothe.com. We’ll link to that in the show notes. Number two, is that I don’t think we often share enough of among pharmacy entrepreneurs of what is the actual bones of the business look like today and where do we want it to go?

I think that’s so helpful, because for many people that are at the different phases of, hey, I’ve got an idea, or it’s a side hustle, or I’m actually starting to validate an idea and grow it and scale it. Being able to hear, even if someone isn’t thinking about a model that fits necessarily within the realm of what you’re doing, I think it’s helpful to hear other models that exist, how those businesses are monetized. What are some of the challenges and where do they envision the growth going in the future? So my follow up question with that in mind, Kimber, is as you have this business that has both a, B2B, so business to business, working with health system organizations, consulting as well as a, B2C, where you’re doing individual types of coaching and programs and books, do you see synergy between the two?

As you talk about your services, I could see where you’re consulting with an organization, and leaders within that organization may say, “Hey, I want some coaching or services individually for me, or vice versa.” Where individuals are engaging with your products, as an individual, as a consumer, and they say, “Hey, we really would love to have Kimber be a part of our organization.” Do you see some of that crossover that’s happening?

[00:22:29] KB: Yes, definitely. There’s crossover on the B2B and the B2C where, yeah, I think both ways. Definitely where I’ve been brought in as a consultant and then they say, “Oh I want to join your membership to have this.” You can finish your consulting project, but now I want to stay involved either themselves or they want it for their team members. So they’ll have them join the membership or attend my summits, buy my books. Also on the other side definitely, I’ve worked with people as one-on-one coaches, and then they say, “Oh this is great. We’ve gotten this far, but it would really help if you can come in and work with us directly. So I’m going to suggest you be a consultant.” I definitely have started, I do plan to look into this further is also trying to get these organizations as part of a bulk purchase. So can they, as part of their professional development of their team members, they pay for.

[00:23:33] TU: Yes.

[00:23:33] KB: Rather than many times the individual is paying for some of my services and products with the health system or pharmacy pay for their members to go. I have group rates, again that I’ve introduced to a few health systems, but want to offer that more broadly where if they have ten people join one of my courses or join the membership, they get ten, 20% off, because they have paid for it. Then the individual has gotten that support and recognition from the organization, so absolutely a lot of synergy there.

[00:24:13] TU: I love that, Kimber. I think you and I maybe talked about this offline while ago as we share some previous career paths and links in the health system pharmacy leadership role. I think that area is so right for ongoing coaching development at the pharmacy director and management level of folks that have found themselves in those roles through extensive training and obviously lots of professional development that got them there. If I’m a director of pharmacy, Chief Pharmacy Officer, I want to not only recruit and retain that top talent, but I want them to grow in their awareness of what is possible. We’ll talk in a moment here about mindset. I certainly see value that can happen as you’re working with organizations also doing some individual coaching and consulting as well, so glad to hear that you’re exploring that direction.

[00:25:03] KB: I think. Well, I’ll just add to that, Tim, briefly. Obviously, you’ve focused a lot on the health system pharmacy leadership with the residency programs. It is great when people know they wanted to go into leadership and they tend to focus on that, but what I’ve definitely seen in pharmacy is a lot of times people are appropriate. They’re very focused on their clinical knowledge. Then they get tapped for leadership positions or they have an interest. It is surprising to me when I ask a group of pharmacists, “Who has a professional development plan?” And maybe five to 10% of the people will raise their hand. I’ve been in audiences where nobody has raised their hands.

Sometimes we finish school and then we’re doing continuing education, but we’re not being strategic about our career development. So for me, it’s all about being strategic, not just in the business plans, but being strategic about your career and those are a lot of the folks that I help in addition to the health system, pharmacy leadership, residency training folks who knew that they wanted to go into leadership. It’s all of the other team members who weren’t as interested, but because they’re strong clinicians, they do get tacked and there’s a lot of a need and opportunity there for ongoing support.

[00:26:22] TU: You’re giving me flashbacks, Kimber of I think everyone who’s gone through residency can relate to the days. It was resi track back in the day when I completed — I think it’s an out form academic, but just the extensive evaluation and goal setting and professional development that happens during that training year. Then you just enter into the wild, wild West. That’s a common thing you hear among folks of that transition is very stark from development and goal setting and evaluation that’s very rigorous to like it becomes much more self-initiated unless you’ve got a supervisor that is very, very passionate about that. So, great reminder for folks that have gone through that training or have not, I think of how important it is to be intentional as we think about the professional development piece.

Kimber, your latest book, Pharmfluencers: The Inspiring Story of Pharmacy Entrepreneurs. Folks can find that book available on Amazon. You can also go to our kimberboothe.com to get more information. One of things you say in the intro is, “I know far too many pharmacists who are experiencing burnout from working within the health care industry who find themselves unable to achieve the level of financial freedom they want, who believe that they can do more than what they’re allowed within the confines of their job.” For those that hear that, that are listening and say, yes, that’s me. What advice would you have for them?

[00:27:43] KB: Well, definitely get the book. The reason I chose to do to get this book together is again, I’m really pro pharmacy. So I want to advance the profession, whether it is through intrapreneurship or with entrepreneurs. So this book, what’s so cool about it, is it is 34 pharmacist entrepreneurs and their inspiring stories of how they have taken their passions, their knowledge, such as yourself as you are featured in this book to share that of how they have created a business to monetize their knowledge and have the impact that they desire.

Some people are doing it, definitely there’s people in the book that are doing it as a side hustle. Others that have been able to transition to it full time like you and I. It is just my way of helping to motivate people to know that they can do this again, either on the side or as a full-time career. Again, I don’t think this is the only path, by all means, I do see lots of opportunity in pharmacy. I do think within our organizations we need to be innovative about it, but I do love entrepreneurship. It’s been a wonderful experience for me in terms of being able to be having some freedom and the creativity to design a business that in some cases has more flexibility than a job.

It does have more risks sometimes. We know there’s some data that shows that small businesses don’t succeed. Again, a lot of what this book focuses on is this expert’s model or the that’s why it’s the pharmacist influencers. So in this book, I really focus on what I said about my business. It’s a slightly easier business model than others that have lots of infrastructure, but what we do talk about in the book and why I think people who are interested in or just want to understand more about businesses is getting the book, reading the stories to be inspired.

There is access to a chapter that talks about the outline of the Pharmfluencer business model, which will walk through some of the basics of starting a business and understanding some of those aspects of why would you start a business? What type of topics do you want to focus on? Definitely we go into what I’ve summarized as the 14 common methods to monetize your knowledge. This is where somebody who, and we definitely have a lot of different entrepreneurs out there like yourself who focus on an area. We have the Prednisone Pharmacists, we have the Fertility Pharmacists, the Public Health Pharmacists, we have all sorts of people who are diving deep in areas to get and share their knowledge, but also being able to monetize that.

Those 14 methods range from creating apps and tools, writing books or e-books, creating online courses, doing coaching one-on-one or group, consulting, clinical services, which is a lot of what I would say when we think about some of the entrepreneurship in pharmacy these days doing MTMs, doing fee for service, clinical services. That’s still an awesome method, but that’s not the only way to monetize your knowledge. You can do live seminars, create masterminds, memberships, sell to smaller PDFs. You could be physical products like Dr. Megan who is the Prednisone Pharmacist, she has a supplement for people on prednisone.

You can do speaking and that could be potentially a moneymaker. It’s definitely also a marketing tool. You can also sell webinars and even do virtual summits these days, which have become important. So those are the 14 ways that I think of to monetize your knowledge that we talk about in the book and then each of the 34 pharmfluencers shares what their journey is and what they’re doing to monetize their knowledge.

You only have to pick one to start. So once you read the book, you’re inspired, you can think through and find your ikigai, which is your passion and purpose, and tie that to something that can be monetized and you pick a method to monetize. I honestly did not start with books. Books are not necessarily my favorite thing to do. So definitely the coaching was where I started doing that one-on-one coaching that actually has probably the lowest barrier to entry in terms of ease for supporting people, right away. Then I moved on to creating the online courses and selling those. Then as you heard about some of the other methods that I am using.

[00:32:38] TU: That’s what I loved about the book, Kimber, is that the 14 ways and ideas that folks can have, the buckets, if you will, of how to monetize. The work that they’re doing, followed up with over 30 different pharmacists’ entrepreneurs and stories. I think the passion we share for featuring pharmacist entrepreneurs and stories is the desire that we, I see among pharmacists today, I’m interested in using my pharmacy degree and maybe what we call a nontraditional way. I don’t know exactly where to go and how to get started. I always say as we share more of these stories like we’re sharing yours here today.

Maybe for some folks, they’re going to say, “Hey, I hear what Kimber is doing. I want to do something like that, or it sparks an idea.” But more than anything, it’s that idea creation and Genesis and just opening up the door of I had no idea. There’s all these pharmacists that are out there that all graduated with a pharmacy degree, and now they’re doing 34 different things in the case of the individuals that are featured in the book. So I think it helps folks to spark an idea, perhaps to get them thinking a different way, but it’s tangible, right? I think often you read about, “Hey, how can you monetize your income or side hustle or this or that?”

Often folks are like, “Hey, that’s exciting, but I don’t really know where to get started.” That’s where the stories, that’s where examples of other pharmacists that are doing certain things and folks can say, “Oh, I’m a pharmacist in that setting, this is give me idea of how I might also be able to monetize the work that I’m doing or at least one place to get started.” So really well done, I think the introduction was brilliant the way that you wrote that. Then covering the business model the Pharmfluencer business models you mentioned, and then followed up with over 30 different pharmacists, entrepreneurs that are featured.

One of the things that you talk about in the book, and I want to dive a little bit deeper here as it relates to your own journey, as well as maybe what you saw as a theme or thread among those that were featured is the concept of the power of mindset. This has come up as a recurring theme of yes on this show. I want to just hear from you, Kimber, as you put together these 30-plus stories. Tell us more about the theme that you saw around mindset and why it was so influential in their own businesses and journeys.

[00:34:48] KB: Absolutely. It’s so important and I’m going to forget some of the great quotes on this topic, but what you think is what’s going to come to fruition, and it’s so important both with when we’re working as well as if we’re thinking about being an entrepreneur, because it’s it definitely can be very scary and it’s important that we think positive, we think boldly. Definitely, you mentioned abundance, a mindset before. That’s where we need to be in this a blue ocean mentality rather than read ocean. There’s a book about that where, again, there are so many needs and opportunities and there is space and need for everybody. We need to find that versus thinking that we’re all fighting for that same piece of the pie and it’s more of that restriction.

I focus on it here in the book. Definitely when I’m coaching people as well as in my courses, how important that is. I always try to support developing that and focusing on having a positive mindset and a critical way to develop that mindset is surrounding yourself with like-minded people. It’s important when you’re considering this journey that you do talk to people who have been there and done it, because it’s easy. I definitely experience this in my family. When you start talking about entrepreneurship and it’s like, oh, you’re going to behave your, you’re nice solid pharmacist paycheck to do something that’s this risky. Really, so you want to do that? It’s being around with other people.

When I was actually at a retreat and everybody’s like, well, Kimber, you need to give your notice. You need to do this now. As soon as you get back from this retreat give your notice. I’m like well, well, let me – I was, I knew I was going to leave within a couple of years, and I didn’t want to leave right then, because it was pharmacists month, but soon after that, I did make the decision, and it was surrounding myself with these like-minded folks that helped me with my mindset about this, that I would be successful and to think about it. I do think one of the quotes I do have in the book is that it did say that, “Destiny is not a matter of chance. It is a matter of choice. There’s not a thing to be waited for. It is a thing to be achieved.”

I think those are quotes and mantras that I try to think about and repeat that helped me with my mindset as well as, like I said, surrounded myself with these wonderful pharmfluencers like yourself to motivate me as well as sometimes commiserate. We can have that positive mindset, but that doesn’t mean that bad things won’t happen. It’s more about how we approach it and how we react to it. That is the key part of the mindset and not just having that grit and resilience to move through any troubles that come up.

[00:38:03] TU: Yeah. Kimber, there’s something really powerful you said in the introduction that I think gives people a sneak peek into your mindset and the motivation behind your work. That was when you said, there’s something empowering about taking hold of one’s life and sharing that narrative with the world. I think for folks that have an idea and want to create something, you want to do something. Don’t underestimate the power that can come from that shift in mindset when you’re creating, your putting yourself out there. Yes, there’s fear. Yes, there’s risk that’s involved, but that’s a beautiful thing. When you start to see that you’re producing something that’s having a positive impact in other people’s lives.

Kimber, I have a follow up on that. In addition to surround yourself with like-minded people, so important and there’s lots of different ways that folks can do that. You’ve created community that helps that as well. Are there one or two other things that you have found either personally or in coaching others, thinking of things can be morning routines or just a voracious hunger to be reading and learning, but are there one or two themes that you have found individually or in coaching others that really help in this shaping up mindset?

[00:39:11] KB: Yes. I mean, a lot of the things you mentioned are definitely important. That’s why I in the book I know I refer to it as having your inner circle and your network, so that is around that creating those connections. I do think that continuous development is an important part of that. Having a professional development plan that not only includes your subject matter expertize, but now also aspects of entrepreneurship. You don’t have to learn and know every aspect of it, because you can definitely hire and pay other people to do certain things. But expanding your development so that you are considering learning, right? This is now your business. You do need to spend some extra time and investment in that.

Definitely having a coach I would say is probably the most important thing I have done for mindset through the years. Again, whether I had what I used to maybe refer to as an executive coach, maybe at one point a career coach and then more of an executive coach when I was in leadership positions. Now having a business coach, I think having a coach is critical. There’s four levels that I actually think about in terms of relationships. The first one is just networking. You’re like level one relationship building is like networking.

Everybody should have a networking plan and be strategic about it. Then people should have a mentor, somebody that’s more that you do meet with that’s within an area that’s related to your development. People should have a sponsor if they’re in an organization, so that’s the third level. A sponsor differs from a mentor usually, because they’re in a position of power. They can sponsor and advocate for you when certain positions come up. Then the fourth level of that relationship area that is critical is coaching.

Some of the training I’ve done on coaching calls your coach, your paid best friend, but it is somebody who will challenge you beyond what you would maybe challenge yourself to do, but also see things in you that you may suppress or not be willing to acknowledge and bring out and move you through your fears to success. I would say again, definitely just having that inner circle related to your networking and your mentors doing your development, but then ultimately having a coach has been what’s been so important for me with my mindset.

[00:41:53] TU: Yeah. Well said. I would agree with that too. It took me a while to get around to the importance of making that investment about time and money, but it’s so important. I would just echo everything you said in terms of when I think about the impact that my coach has had on my overall mindset and it’s not just in those coaching sessions, right? I think when done well and when you are ready for the coaching, it’s the constant thought and dialog that’s going on, could be internally, it could be after coaching session, my wife Jess and I or a friend we’re digesting and following up on things, but it’s a continuous process that’s ongoing and it’s really, really fun to think about, what’s the next level? What’s the next level? Where else can I continue to grow and stretch myself? Often that means perhaps going into some areas that are uncomfortable as well.

[00:42:40] KB: It’s sometimes what my coach has also done is, in a way the opposite. It’s also a matter of making sure I do have balance and that’s it is a business. There’s a reason like you said, about what you talk to your clients about is, what is your goal here? Well, it’s not in most cases to work more hours than you are working at the pharmacy, but it is for some more freedom and maybe that’s not something that you expect maybe in your first few years of business.

I know my coach also helps me with that to be realistic as well in terms of, am I prioritizing the most critical things and ensuring that I don’t burn out or put too many things on my plate. Or also definitely challenge me to make sure I’m outsourcing things, if it is definitely things that I can delegate. Definitely thinking new and balancing comes from a great coach.

[00:43:35] TU: Speaking of outsourcing, you talk about in the book that your biggest learning curve was being the transition from a solopreneur to hiring and filling positions, which I was surprised at, given your background in managing and leading teams. I would assume very, very comfortable with delegation, which may not always be the case for four folks. So talk to us more about why this was such a steep learning curve for you?

[00:43:58] KB: It is a good question. I still to this day, I think, I still have some trouble with it. I don’t know why, right? Like you said, I’ve hired hundreds of people. I’ve had teams of hundreds of people under me through a Matrix organization. It was — when you’re using your own money, I guess, and I guess like in some people, like bootstrapping, I didn’t take loans, the expenses for those first few years as a side hustle, I was losing money. Technically based on the investments I was making in my education, the website, some things, because it was on the side, I wasn’t bringing in a profit. So you think hiring is just going to mean more expense. But at the end of the day, and as I’ve learned from more entrepreneurs, the faster, and you can scale up through working with others that will usually get you to the finish line faster to become more profitable.

I did have trouble seeing that early on. Then interestingly, even when I was hiring it was easier definitely to hire for specific tasks. If I needed a graphic designer, I needed a video editor. Those things seemed easier to hire for. Then I definitely had a mindset around my assistant, again where I was doing things myself and then hiring an assistant for 10 hours a week or 20 hours a week. It wasn’t until I did take a course actually on virtual assistants. It’s like, how can you scale yourself, right? Then put yourself as the CEO. Literally, that’s what they called this course that I took.

It was like, you’re the CEO of your business. You would not be the ones posting certain things or you would not be the one to create a web page. That would be somebody else if you were the true CEO of your business and thinking through that and moving to actually hiring somebody full time where just like I do talk about in our profession, you should be practicing at the top of your license. You should do the same in your business. Unless it’s something you absolutely are uniquely qualified, and only you can do it then you should be able to delegate or outsource that.

It is interesting where I feel like I still was not doing a great job was even on the hiring process. I was trying to work and wanted to just hire different agencies, who would get me an assistant. I’m like, I have hired lots of people, right? Why haven’t I converted to do that myself? So once I switched and did that and I actually hired myself and same thing I’m doing now with looking for subcontractor consultants is I can do the interview the same way I did before. I don’t know why I was treating it differently. There are definitely a lot of things that should crossover from intrapreneurship to entrepreneurship that for whatever reason I had a mental block about, but that is cleared now and moving more focus into making sure that it is a true business. I’m hiring a team just like I would have done when I was the chief pharmacy officer.

[00:47:21] TU: Great stuff, Kimber. I think that first one is very difficult. I think as time goes on it becomes a little bit easier as well, but appreciate the reflection. I would encourage again, folks to make sure they pick up a copy of Pharmfluencers: The Inspiring Stories of Pharmacy Entrepreneurs, over 30 pharmacy influencer entrepreneur stories. You can pick that up on Amazon or you can also pick that up by going to kimberboothe.com. Kimber, what’s the best place that folks can go to learn more about you and follow your journey?

[00:47:48] KB: Yeah, definitely coming to my website at kimberboothe.com, they can learn a little bit more about me. If you go to kimberboothe.com/links, you can get access to my various social media channels, as well as get the Free Pharmevader score to see what a pharmacy innovator you are. Basically, just get on my email list, so I can communicate with you more regularly when these different opportunities come up. Basically go to my website, kimberboothe.com or kimberboothe/links to get to all of my contact points.

[00:48:24] TU: Great. We’ll link to the website as well as LinkedIn and the books, we’ll link to all that in the show notes. Kimber, congratulations on, again the new book, your second book, the work that you’re doing, the impact that you’re having on the profession. Look forward to following your journey and thank you so much for coming on the show.

[00:48:39] KB: Thank you, Tim. Thanks for having me.

[OUTRO]

[00:48:41] TU: Before we wrap up today’s show, let’s hear an important message from our sponsor, Insuring Income. If you are in the market to add own occupation disability insurance, term life insurance or both. Insuring Income would love to be a resource. Insuring Income has relationships with all of the high-quality disability insurance and life insurance carriers you should be considering and can help you design coverage to best protect you and your family.

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Posted on May 19, 2022November 2, 2022 by yfpadmin

Why YFP Planning’s Lead Financial Planners Are All CFPs®

On today’s episode, sponsored by Splash Financial, YFP Planning Financial Planner, Kimberly Bolton, CFP® discusses why the CFP® designation is the most valuable credential when providing comprehensive financial planning, why the term financial planner in and of itself doesn’t mean a whole lot, what questions you can ask to find a planner who is a good fit for you, and what someone can expect when working with a financial planner.

About Today’s Guest

Kimberly Bolton, CFP®, is a Financial Planner at YFP Planning. Along with her team members, Robert Lopez, CFP®, and Savannah Nichols, she strives to help YFP Planning clients on their financial journey to living their best lives. To go along with her CFP® designation, Kim has a B.S. in Consumer Sciences with a concentration in Family Financial Planning and Counseling. When not working, Kim enjoys being in the sunshine, hitting the gym, hiking, traveling, taking her dogs Nugget and Toot on adventures, being a food enthusiast with her husband Allen, and spending time with her bonus kids Brianna and Brady.

Episode Summary

This week, YFP Co-Founder & CEO, Tim Ulbrich, PharmD, sits down with YFP Planning Financial Planner, Kimberly Bolton, CFP®, to discuss why all of the lead financial planners at YFP Planning are CFPs®. In their discussion, Tim and Kim cover why Your Financial Pharmacist believes the CFP®, CERTIFIED FINANCIAL PLANNER, designation is the most valuable credential when providing comprehensive financial planning. Kim shares her personal story of becoming a CFP®, the rigorous education and experience requirements to become a CFP®, the comprehensive nature of the CFP® exam, the ethical standards associated with the credential, and why the CFP® is considered the most prestigious financial designation in the industry. She digs into why the term financial planner, or financial advisor, in and of itself doesn’t mean a whole lot, what specific questions you can ask to find a planner that is a good fit for you, and what someone can expect when working with a financial planner. Kim also explains common fee structures in the financial planning industry and why YFP Planning uses a fee-only structure. Tim shares a little bit of his own experience as a YFP Planning client himself, echoing Kim’s sentiment that the partnership between planner and client is an intimate one and that as a client, feeling comfortable with your planner will make an incredible difference in your experience. Kim closes with an awesome client success story, sharing how one couple was able to make their home-owning dreams come true years earlier than planned.

Key Points From This Episode

Background on Kim’s professional journey to becoming a CFP®.
What inspired her to pursue a career in financial planning.
We find out about the work that Kim is currently involved with at YFP Planning.
Why the YFP team believe so much in the CFP® designation.
Some examples of how comprehensive the CFP® training is.
How working with a certified CFP® is beneficial for the client.
Kim tells us what is required to enter the CFP® course.
What people taking the CFP® board exam can expect.
Learn about the experience requirement needed after passing the exam.
The expected ethical standards once you are certified.
Differences in the types of CFP® planners in terms of fees and services.
A brief breakdown of the different fee structures associated with CFP® planners.
Examples of good questions to ask a financial planner to ensure they are the right fit for you.
Kim shares a success story about working with a CFP®.

Highlights

“If you do any research on it, you’ll see that [being a Certified Financial Planner] is titled the most prestigious financial designation that you can have within the industry.” — Kimberly Bolton, CFP® [0:10:02]

“Here at YFP, it’s really important to us that our clients are comfortable with our recommendations. We want the clients to feel that the recommendations we make are made because it is in the client’s best interest.” — Kimberly Bolton, CFP® [0:11:58]

“Talking about your finances is a very intimate conversation. You want to make sure you are comfortable with your financial planner, because you’re going to have some intimate talks about your finances!” — Kimberly Bolton, CFP® [0:22:33]

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 a chance to welcome YFP Planning financial planner, Kim Bolton, onto the show. We discuss why we believe the CFP, Certified Financial Planner, designation is the most valuable credential when providing comprehensive financial planning. We also discuss why the term financial planner or financial advisor in and of itself doesn’t mean a whole lot, what questions you can ask to find a planner that is a good fit for you, and what someone can expect when working with a financial planner.

Now, before we hear from today’s sponsor and then 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 240 households in 45 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.

Okay, let’s hear from today’s sponsor, and then we’ll jump into my conversation with YFP Planning financial planner, Kim Bolton. This episode of the Your Financial Pharmacist Podcast is sponsored by Splash Financial. With interest rates on the rise, it’s a good time to evaluate the refinancing of your student loans. If you’ve ever considered refinancing your loans, check your rate now through Splash Financial. If you qualify, refinancing could help you get a lower monthly payment on your student loans or get a lower interest rate. Splash helps you shop and compare loan refinancing offers across lenders nationwide.

Browsing rates through Splash Financial is fast, free, and won’t impact your credit until you complete a full application. Now, when you successfully refinance $50,000 or more, Splash Financial will give you an extra $500 in cash bonus using our link, splashfinancial.com/yfp. So check your rate today and see what you might be able to save at splashfinancial.com/yfp.

[INTERVIEW]

[00:02:21] TU: Kim, welcome to the show.

[00:02:22] KB: Thanks. Thanks for having me. I’m really excited to be here.

[00:02:25] TU: Well, this has been a long time in the making. We just celebrated your two-year anniversary here with YFP. So Kim is one of our financial planners that works with the team at YFP Planning. Today, we’re going to be talking all about why our financial planners are all CFP, certified financial planners, and why we believe so much in the CFP designation. The reason we’re putting Kim on the hot seat to talk about this topic is Kim just completed all of the components of the CFP to be able to use those marks. So, Kim, congratulations officially. Exciting to see that to the finish line.

[00:02:57] KB: Yeah, thanks. Thanks so much. It was a long journey. It took me – If you counted like my school and everything, it was about a six-year journey that it took to have the three little letters put behind my name.

[00:03:11] TU: We’ll talk about why that takes so long and why those three letters are so important. But before we jump into learning about the CFP requirements, a certified financial planner requirement, tell us more about your career journey leading up to and including the work that you’re doing with YFP Planning.

[00:03:26] KB: Yeah. So my career journey in the financial planning industry actually began with YFP. YFP is the first financial firm that I have ever worked for. Before Tim found me, I had applied and interviewed with a couple of big corporate financial firms, and I had just realized like that’s not really where I want to be. Like that didn’t feel like home to me. Prior to the financial planning industry, I actually worked for the University of Alabama. I was an office administrator in their maintenance department. So I kind of already had experience with like the customer service piece and like invoicing and paperwork and the admin part of the job.

[00:04:03] TU: Where did that interest come from, Kim, in terms of that pursuit of a career in financial planning?

[00:04:08] KB: So I was actually four months from graduating from college with an English major when I realized I want to be a financial planner, not an English major. So it started way back probably when I was like 16 and first started working. So I learned at a pretty young age how to semi-manage my finances since I had a car payment and insurance and things like that. Then I went through college thinking I was going to be an English major, and I realized in my thesis analysis class that that’s not where I wanted to be.

So I went and talked with my college advisor. Just through like brainstorming different jobs that I could have, I had kind of come up with the idea of a finance major. A finance major and a financial planning major are – It’s similar, but they’re very different. The finance major is more broad than the financial planning major. So you get pretty like concentrated when you do just a financial planning major. So when I had first mentioned finance to my advisor, we were going through the different jobs that I could have with that degree and everything, and we eventually just realized that I wanted to help people with their finances, and I wanted to help people be able to retire and live a financial-free life.

Then that’s when we decided that financial planning is what I wanted to do. So four months before graduating, I changed my degree to be financial planning. It added a year and a half onto my schooling, but it was completely worth it, and now here I am, being a financial planner.

[00:05:39] TU: I think for those, Kim, that have not worked with a planner, it can be hard to understand, like what do I expect? What is actually involved in that relationship? What does it look like? One of the things we’re going to talk about is how different this service can be. Certainly, that term financial planner, that term financial advisor, wealth manager, lots of terms that are used, it does not mean that all things are created equal. So there’s a variety of ways that it can be done.

But I think for folks that have not worked with a planner, it can even just be hard to wrap your arms around what does this actually look like. So as it relates to your work with YFP Planning and working alongside lead planner, Robert Lopez, give us a sneak peek into what your day-to-day, what your week-to-week looks like, as you help support the financial planning process for over 100 pharmacist households.

[00:06:23] KB: Right. So day-to-day, we’re pretty much in the nitty-gritty financial planning. So day-to-day, I’m helping Robert get prepared for meetings, making the presentations for him. So if you are a client of YFP and you’ve ever seen any kind of slideshow or slide deck, that is definitely me and Savannah, working behind the scenes to kind of put that together for him. Working with Robert to help make any kind of recommendations, usually like the two of us brainstorm together to make the best recommendation for the client based on their certain situation.

Then from a week-to-week perspective, that’s kind of when you get a bigger picture, and you have like more projects coming in. So right at this moment, it looks like transitioning our clients into like a quarterly meeting schedule and kind of what that looks like for them, what that involves from us from like a workflow perspective, and really kind of catapulting that into existence and moving clients into a quarterly schedule.

Overall, I directly support Robert and just make sure he’s prepared to give the client the recommendation, and I help him do any kind of research that is needed so that we can make sure we’re making the right call on different financial scenarios.

[00:07:37] TU: Robert, for folks that have not heard him on the podcast before, Robert Lopez is one of our lead financial planners, along with Kelly Reddy-Heffner. We had Robert on the podcast most recently on episode 248, where he talked about some public service loan forgiveness, PSLF, success story. So if folks are wondering, “Who is Robert,” that is who Robert is.

I think you highlighted well, Kim, that there’s a lot of work that goes on behind the scenes. I think about as we bring on a new client into YFP Planning, there’s a lot of work involved in terms of the onboarding, making sure we have all the information and then, of course, in the ongoing basis, preparing for meetings, following up for meetings. There could be transactions that need to happen, tasks that we need to make sure that we follow up on.

Even as one example, myself that you help, so I’m a client of YFP Planning, and Tim Baker is my financial planner. As I made the transition from Ohio State to working full time at YFP about a year ago, I had to do a rollover of my 401(a). So I had some questions as I looked at those forums. I wanted to make sure I did it right. I wanted to make sure there was no implications in terms of taxes or penalties. So you helped me execute that transition and that rollover. Lots of things that are happening that people may not see at face value, even for those that are engaged with the planning, where they jump onto an hour meeting or so with the lead planner.

Kim, one of the things we’ve touched on in the past is the importance of understanding, as I mentioned just a few moments ago, that not all financial planners are created equal. So they can have varied educational experiences. They can carry different designations. They can be regulated in different ways. They can charge in a variety of ways. We’re going to link to in the show notes an important resource that we have available to download for free, and that is the nuts and bolts of hiring a financial planner that I would encourage listeners to check out.

In that resource, we cover what are the different types of planners, how do they get paid, what are some questions that folks may consider asking when they hire a planner. Again, that’s the nuts and bolts to hiring planner. You can get that and download that at yourfinancialpharmacist.com/nutsandbolts, and we’ll link to that in the show notes as well.

So we’re going to focus our time on the CFP designation, the certified financial planners. We believe that that is the credential that’s an important criteria to do comprehensive financial planning and to do it well. We’re proud to have five CFPs on the YFP Planning team that collectively serve over 250 pharmacist households for one-on-one planning. Kim, let me punt this to you since you’re the most recent designee of the CFP on the YFP Planning team. Why does YFP believe so much in the CFP designation?

[00:10:10] KB: So the CFP designation, if you do any kind of research on it, you’ll see that it’s kind of titled the most prestigious financial designation that you can have within the industry. I really think that YFP believes in the CFP designation the way that we do, simply because when you have the CFP designation or you’re working towards that designation, you’re really proving to yourself and you’re proving to others how high of standards you have for yourself. So when someone is either in the process or has a designation, they are being extensively tested and quizzed on their knowledge of financial planning.

The questions and the coursework that you go through, it really digs deep and it makes you apply those financial planning concepts to real-life scenarios. So even though like you may be answering a multiple choice question when you’re being tested or when you’re doing like practice quizzes and everything, if you don’t understand how to apply the concept to a real-life scenario, then chances are you’re not going to be able to answer that question correctly. So the CFP designation really just sets you aside from everybody and shows how serious you are about your career in the financial planning world.

Another part to that is CFP designation requires that you be a fiduciary, which in short means you put the client’s interest above your own, even if that recommendation doesn’t necessarily benefit you. It just benefits the client. This would come into play, for example, like if a financial planner had recommended that somebody go out and get like a $1 million life insurance policy. There are scenarios where if you’re not a fiduciary, you could be recommending that to that client because it’s in your best interest, because you possibly get a commission off of that.

Here at YFP, it’s really important to us that our clients are comfortable with our recommendations. We want the clients to feel that the recommendations we make are made because it is in the client’s best interest. We don’t want that client to think like, “Hey, are they just making this recommendation because it benefits them, not because it benefits me?” So that’s really the big picture why I think YFP takes the CFP designation and so serious, is because it gives our clients that peace of mind. It gives them that level of comfort with us that we are working in their best interest, and we are doing what’s going to benefit them more than what’s going to benefit us.

[00:12:35] TU: Yeah. That was a great explanation, Kim, the fiduciary piece. We’re actually going to link that in the show notes. If people want to learn more about what the fiduciary standard is, why it matters, how it’s different from what’s known as the suitability standard, John Oliver has a great segment on this topic, and we’ll link to that in the show notes. Kim, you explained it well. So I think the highlights there would be the fiduciary piece, the rigors we’ll talk about in a moment, what makes up the CFP designation.

As Tim Baker often says, “The bar of entry into financial advising and hanging a shingle to be a financial adviser is fairly low.” So being able to have some rigor, some documented evidence of the work that’s been put in, the seriousness of that training, and obviously being prepared to then provide comprehensive financial planning, that’s something we see often that traditional financial planning services might not necessarily be serving at folks in all different phases of life. Are they well-versed in things from retirement planning to debt management and everything in between? I think if you look at the CFP curriculum, very intense but also very comprehensive.

So to that point, in terms of the rigor and the intensity, Kim you mentioned several years it took you to obtain that designation. So talk to us about the requirements that one must go through in order to be able to use those three letters by their name.

[00:13:52] KB: Right. So there’s a couple of different ways that you can be qualified for the CFP exam. The most common is for someone to go through the CFP board’s coursework. In my situation, my college degree qualified me for the CFP exam. So you either have to have a bachelor’s degree that qualifies you for the exam, or you have to go through the CFP board’s coursework. Then once you have completed the education piece, you were then allowed to sit for the exam. The exam is 170 questions. They give you a six-hour limit, and it’s broken into three-hour segments. So three hours and then they let you leave for 30 minutes, and then you come back for the remaining three hours. Yeah, it’s pretty brutal.

When I was taking mine, the lady that was working the front desk at the testing center when I left or when I was leaving, she told me, she said, “You’ve been here a long time today.” I’m like, “Yes, I just took a really long test.” Then once you pass that exam, which again during that exam, you’re tested on the ability to apply financial planning to real-life scenarios, and then you’re given a few different case studies where you have to dig through. It’s like a multiple answer question that you have to really look at.

Then once you have passed the exam, you are then required to fulfill an experience requirement. So if you are working directly underneath another CFP, which in my case, I was working directly under Robert and Tim Baker, so working underneath them, I was required to get 4,000 hours of experience, which comes in at almost two years of work in the financial planning industry. Once all that is complete, then you basically sign your life away, saying you will be a fiduciary from here on out, and you will uphold to the CFP board’s like ethical standards and their standards of conduct.

Then every year, we have some CE courses that we have to do. It sounds simple, but it’s really complex. After you’ve done all that, so the education, the exam, the experience, and then once you agree to the ethical requirements, you become a CFP.

[00:16:02] TU: Yeah. So I think pharmacists, they can relate to this, right? You described an educational component, you described an examination, and then you described what I would consider like an experiential component. So you mentioned 4,000 hours of practical experience and not until all of those have been completed and plus the acknowledgement that you’re going to uphold the fiduciary standard. Then at that point, you can use the certified financial planner marks.

We think about pharmacy education. You’ve got the doctor pharmacy program. You’ve got the experiential rotations, which are typically throughout school, and then the final year of pharmacy school. Then we have the licensure examination. So we have a NAPLEX exam, and then we have a state law examination. However, what I’ll point out here is that I won’t say the NAPLEX is easy, but the pass rate of the CFP is much lower than the NAPLEX. I’m looking at the March 2022 examination of the CFP, and the pass rate was only 65 percent, so a very rigorous exam.

Typically, we see board pass rates in pharmacy – I think the last I looked at it, we’re closer to 85 to 90 percent, so very rigorous exam. Then to my comment earlier, it’s a great benchmark, certainly not the only thing folks should be looking at as they’re shopping for a planner, but a good indicator that someone has gone through a rigorous process, educational component, examination, and an experiential piece that demonstrates their ability to do planning.

Kim, I mentioned this briefly earlier, but I want to talk more about it in this concept of are all CFPs created equal in terms of types of services and how fees are assessed. Really, when you get the CFP marks, you have demonstrated that you’ve gone through all the things that you just talked to, but that may not mean that all CFPs are operating in the same way in terms of the services that they offer or as well as in the fees that they’re charging, correct?

[00:17:44] KB: Yeah, that’s right. So it’s really a wide range of like different services and different fee structures that you can have. Kind of to be brief with it and not go down a rabbit hole, you can have CFPs that are comprehensive planners. So that’s like us here at YFP, where we go from one end of the spectrum to the other. We can help you buy a house, we can help you invest your 401(k), or we can help you improve your credit score, anything along the lines. So it’s really everything under that financial planning umbrella.

Or you can have CFPs that strictly do just investment management. This is going to be CFPs that worked directly with your investments, so like that employer retirement plan or that traditional IRA or Roth IRA that you may have. Just another different spectrum that you could be on is you could simply work at an insurance company, and you could be the financial planner that is selling the insurance, whether it’d be life insurance, disability, umbrella insurance. It’s a big world out there, and so your options are kind of limitless on what kind of services you provide.

Then as far as fees go, so really the three most common that most people have probably heard is a fee-based, commission-based, or a fee-only. So fee-only is what we are here at YFP. I’m sure we’ve mentioned it a few times on the podcast but fee-only basically. When you come on board with us, and we quote you your price to work with us, that is the price. That is what we are paid. We don’t get any kind of commissions or any kind of kickbacks or anything like that. Whereas with commission-based fees, that planner is going to work strictly off of the commissions that they make from selling you products.

Then fee-based gets a little sticky because it is where it can be a flat fee, but then you also receive kickbacks off of people’s investments or insurance policies or things like that. So fees and services can get a little bit sticky and can be a tad complicated, but that is in short are like the major ones that are the most common.

[00:19:44] TU: Yeah. As you described, Kim, it really is the Wild Wild West in terms of how services are constructed, how often you meet with a planner, what to expect, what they’re managing, what they’re doing, as well as the fees, and how those fees are assessed and charged. So that really means there’s due diligence on the client side to be asking the right questions as they’re conducting that search. We talked about this in detail in episode 54. Several other resources we have as well available at yfpplanning.com. Folks can look for more information there. But it really talks more about the model that we do at YFP Planning, as well as the concept of fee-only.

I want to just for a moment give an example, Kim, of fee-only and why we believe that matters. So you gave the definition of it. Let’s say you’re working with a client, Kim, and you determine that there’s a need for, let’s just say, long-term disability insurance on top of some employer coverage they may have. Well, under the fiduciary standard, under the fee-only model, as you work with that client to determine what the benefit need is, you’re not selling the insurance policy, number one, and you’re not getting any direct kickback for the recommendation of any specific product that you would be recommending.

In that case, you can really help evaluate objectively what does the client need, what does the client not need, and then help look at a variety of different options as they shop those policies around. So I think that many pharmacists that will resonate with them in terms of wanting to have unbiased recommendations as possible. To that point that I made that it’s important, we’re asking good questions to understand what do people do in terms of services and how do they charge. What are some questions that you would recommend, Kim, folks ask as they’re looking for a planner that is hopefully a good fit for them?

[00:21:25] KB: Yeah. So I think the first question you should ask is are you a fiduciary? Because simply, you want somebody that is going to give you advice based on your best interest, not the planner’s best interest. The second big one is like what qualifications do you have. You want to make sure that your planner is qualified to actually be giving you financial advice, and it’s not just somebody like posing as a financial planner. Then how are you paid is going to be another big one. So that’s going to tell you like, “Do they receive commission off of me like. Is this a fee-only relationship?” So how are you paid is a big one.

Then another one would be like how is our relationship going to work. So you want to make sure that you and the financial planner are on the same page about how the relationship will work between the two of you. So like how often will you meet? Like how will you manage my assets? How do you plan to help me buy a house? Like kind of what does the relationship look like? Other than those big questions, I would simply just make sure that you jive with that financial planner.

Talking about your finances is a very intimate conversation, so you want to make sure like you are comfortable with that financial planner because you’re going to have some intimate talks about your finances. So you want to make sure that you’re comfortable opening up with that person and that your personalities kind of go together. In that way, you feel comfortable talking to them, and you feel comfortable sharing details about your finances, and you don’t feel like you have to hold back because either personalities clash or because you’re not really comfortable opening up with them.

[00:23:03] TU: Great overview. As we always say, shout out to Justin here who does our business development and our discovery calls on the front end, it has to be a good fit from both ends, right? If you as a client are going to make an investment of time and money, and our planning time is going to make an investment in that relationship as well, there has to be a good fit, and that starts with expectations in terms of folks being on the same page. I think that starts with making sure you’re comfortable what that relationship looks like and by asking some good questions, as Kim just highlighted there.

Kim, do you have an anonymous success story or two that you can share of clients of YFP Planning that really highlights the impact that a CFP can have and that the planning team can also have at large?

[00:23:46] KB: Yeah. I actually have a really good example. I had even mentioned it to Robert to make sure he was okay with me sharing. When I told him the example that I was going to use, he was completely on board with it, so I’m excited. But we had these long-term clients. They’ve been around with YFP I think longer than I have, but they had gone through residency. The wife had already graduated, and she was in her career. But the husband was still in residency. It was cool to be able to watch him finish his residency program.

Then once he had finished, they moved states to be closer to where he had received a job. They were living in a townhome, and they had done a couple of budgeting meetings with us, make sure they were saving correctly and make sure that they were saving enough for retirement. Then the question came about. They were like, “Well, we want to buy a house.” Behind the scenes, they had done all the math to figure out how long they needed to save in order to have that 20 percent down payment that we always hear about when it comes to home buying.

They had figured out that it was going to take them five years to save a 20 percent down payment, and they were really in the dumps about it. Like they enjoyed where they live, but they also wanted to be homeowners. They wanted to get that next chapter in their life started. So we had a call with them. We could kind of tell that they were down in the dumps about it being five more years before they could even really begin to seriously look at houses and put in offers and everything. Then we made the recommendation to them. We told them like, “You are eligible for a doctor loan, which with the doctor loan, you don’t have to have the 20 percent down payment.” So we went through the whole process of educating them on what a doctor loan is and what those terms look like and like why they don’t need the 20 percent down payment.

Then it was literally like 30 days to the mark after that conversation. They were closing on their first house without a 20 percent down payment. At this point, they’ve probably moved in. I haven’t talked to them lately, though. But it was awesome to be able to help them realize like, “Hey, we don’t have to wait five years to buy a house. We can buy a house now.” So they were over the moon, they had found a home and that the home ownership chapter was beginning. It was awesome to watch, and it also just made me realize, and they even mentioned it. Like without the YFP Planning team, like who knows if they would have ever even known what a doctor loan was, and that it could have been five more years before they actually got in the home. So it was awesome to be able to help them make that transition into the next chapter of their life.

[00:26:24] TU: I love that story. Thanks for sharing. What I love about that too is when we think about the pharmacists home loan, doctor loan products, we’ve talked about them on the podcast before, one of the I think challenges that can be there is if folks aren’t really evaluating that home purchase in the context of the rest of the financial plan, is that home-buying can be exciting. It can be emotional. It can be stressful. We can easily find ourselves down a path of the home purchase that may not jive with the rest of the financial plan.

You are here. Robert is with a client and not only being able to open up a new avenue that maybe wasn’t considered to make this home purchase a reality, but also considering and evaluating that and the rest of the financial plan. So how does a home purchase fit with also making sure we’re progressing for retirement and with other financial goals as well? So really cool story to share, and I think one of the things that you and the planning team do so well is striking this balance between taking care of our future selves but also living a rich life today. Both are really important, and that’s a great story and example of why it is.

Kim, thank you so much for taking time, number one, to come on the show, and excited to get you in front of the YFP community, if folks don’t know who you are, aren’t familiar with you yet. Again, congratulations on all the hard work that went into getting the CFP. I would remind folks that we’ve got a great guide an overview of the nuts and bolts to hiring a financial planner. You can download that for free at yourfinancialpharmacist.com/nutsandbolts.

Then for folks that are hearing this and saying, “Hey, I’d love to learn more about the planning services offered by Kim and the rest of the team at YFP Planning,” you can book a free discovery call with Justin Woods, our Director of Business Development. You can do that by going to yfpplanning.com. So, Kim, again, thank you so much.

[00:28:11] KB: Yeah, thank you for having me.

[END OF INTERVIEW]

[00:28:13] TU: Before we wrap up today’s episode of the Your Financial Pharmacist Podcast, I want to, again, thank our sponsor, Splash Financial. If you’ve ever considered refinancing your loans, check your rate now through Splash Financial. If you qualify, refinancing could help get you a lower monthly payment on your student loans or get a lower interest rate. Splash helps you shop and compare loan refinancing offers across lenders nationwide. Browsing rates through Splash Financial is fast, free, and won’t impact your credit until you complete a full application.

Now, when you successfully refinance $50,000 or more, Splash Financial will give you an extra $500 in cash bonus using our link, splashfinancial.com/yfp. So check your rate today and see what you might be able to save at splashfinancial.com/yfp.

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 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 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 Pharmacist Podcast. Have a great rest of your week.

[END]

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