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A Money Workshop For Women: Q&A

Last month I attended Transform Philly Church‘s Money Workshop For Women, in West Philadelphia with Bola Sokunbi of CleverGirlFinance.com presented. I was glad to have the opportunity to attend to support my Personal Finance Friend, Bola, and visit my old stomping grounds of West Philadelphia.

The 2-hour workshop presentation covered Money Mindset, Budgeting for Greatness, Investing and Building Real Wealth. And there was a room full of attentive attendees, keen on learning all Bola had to share about building wealth. On a Saturday morning at that, these women were not playing! It was so great to see!


 

 


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There was particular interest in investing and learning more about index funds, as well as, understanding and managing student loans and getting rid of debt.

During the Q&A portion of the workshop, Bola invited me to chime in on paying off student loans and making a plan for your money, in order to reach your financial goals. Of course, I happily jumped at the chance to join in!

 

 

 

Here’s a summarized version of the Q & A portion of the workshop.

Money Workshop For Women

Questions & Answers


Money Question 1:

Can you buy index funds within your 401K?

Money Answer 1:

Bola: What you have available to purchase within your 401K is dependent on your company. Companies usually create an agreement or plan with brokerage firms. Based on whatever agreement they structure, with the brokerage firms, 401k’s may offer one mutual fund, or ten.

What you have available to purchase within your 401K is dependent on your company.
They offer they may offer individual funds, they may offer index funds, they may offer a Roth option. It just depends on your company.

You can buy index funds through a brokerage. My favorite brokerages are  like Vanguard or Fidelity because they offer great customer service and I really like them.

Melisa: Another thing is that you can talk to your company’s HR, like Bola suggested during her presentation, to ask about getting more information regarding what type of funds are available within your 401k and then your HR department can tell you whether there are index funds available within your 401k.

Keep in mind too, that if your employer provides a match on your 401k contributions and you have contributed to a level to get that match, and you still want to save more, you can open you own Roth IRA, with Vanguard for example, and then Vanguard would have more options and you can be in control of what you invest in.

Bola: You can invest outside of your 401k, but the recommendation is that you get the full employer match then go outside.

Money Question 2:

For Melisa, what I want to know is, in terms of student loans, I am just intrigued about how you managed to pay off so much, save for a home. I am curious as to how you stayed disciplined to budget?

Money Answer 2:

Melisa: Like Bola covered, it starts with your mindset. I graduated with $68,000 of student loans and just looking at my big picture, I had no money but I had all these loans. I knew that this was something that I wanted to get rid of, but also invest and save for a home one day.

My mindset, from the beginning, was to figure out how to pay as much as possible towards the loans. I started out with a plan that I would pay off all my student loan debt in 3 years, but life happens, and I ended up paying off $37,000 in 5 years, and I still saved and invested.

My mindset. from the beginning, was to figure out how to pay as much as possible towards the loans.
One thing that I did when I finished school is keeping my expenses low. In general, your “must have” expenses should typically be less than 50% of your income, but I knew I had all these loans, so I kept my “must have” expenses much lower than 50% of my income.

I did not get any new or financed cars. I got a used car that I paid $6,000 for and I kept that car. By keeping my expense low, I had more money to allot towards savings and debt payments.

When I started my first full-time job, I made sure I did not even know how to live on 100% of my income. One of the first thing I did was sign up for my 401k. I also had the option of a Roth 401k, so I was investing in both automatically. Then I determined what amount I would put towards my student loans and told myself that even though I like to travel, I will have to just do road trips only. I had to ask myself what are my values and one of my main values was to get out of debt.

By keeping my expense low, I had more money to allot to savings and debt payments.

That meant that I was committed to not getting a new car, even when my car got totaled, I got another used car. I was very conscious of what my goals were, automated my finances and saved my raises instead of inflating my lifestyle. I chose to stay in the same apartment I had and commit more money to savings and pay off more debt.

This is how I was able to buy a home, even when I was not done with paying off my debt.

Money Question 3:

If I have debt, should I be saving? Should I be contributing to my 401k, if I still have debt? How do you decide?

Money Answer 3:

Bola: I am of the opinion that you can save and pay debt, that’s my philosophy. Dave Ramsey, who I love, will tell you to stop saving for retirement, save $1,000 in your emergency fund and put, everything you can, towards paying off your debt. I think that you have to save for retirement, no one is going to prepare for your retirement for you. At the minimum, put that $1,000 emergency fund there, do that. If you are employed and you employer offers a company match for retirement savings, get that match. To me, it doesn’t make sense to forego  the employer match.

Money Workshop For Women Money Mindset QuestionIf for example you contribute 10% toward retirement and get your employer match, then save $1,000 for an emergency fund, keep saving for retirement and then get aggressive with your debt. If you are going to sacrifice not saving anything else, you need to get aggressive with your debt. The quicker you pay off that debt the sooner you can come back to savings. And it’s important that you come back to that savings. If your goal is just to pay off debt here and there and you are not going to save any money, then you are wasting your time. You need to get aggressive with paying off your debt and that means, paying off as much as you can, as quickly as you can.

You need to get aggressive with paying off your debt and that means, paying off as much as you can, as quickly as you can, to destroy that debt. If it is a 2-year plan, or a 3-year plan and you know at the end of that plan you will be at zero debt, then

You need to get aggressive with paying off your debt and that means, paying off as much as you can, as quickly as you can.
When you consider the interest rate that you pay for your debt, it doesn’t make sense when it compares to savings in a bank account. But you retirement is an investment, it’s not like savings in an account at less than 1%.

So again, establish your emergency fund, fund your retirement and get aggressive with your debt.

 

Melisa: To piggy back on what Bola says, when it comes to investing in your retirement and you are getting an employer match, why would you miss out on that employer match when paying off debt, when you could choose to get an extra job to put towards debt payments.

Also, think about whether choosing to stop saving for retirement will make your debt payoff period shorter by two years or more. Consider if it will be worth it for you to forego saving for retirement if it will not help you pay off your debt in less than a year.

Bola: Think about the fact that your contributions to you retirement plans, 401k or 403b, is pre-tax, so if you were to use a take home calculator, you will see that by the time you are taxed 25% – 35% you will have less than what you would have contributed to your retirement to put towards your debt.

Money Question 4:

Any advice for high school senior going to college?

Money Answer 4:

Bola: Sit down with your parents and have that discussion about paying for college. Once you go to college, when you go to the job fairs do not sign up for any credit cards, under no circumstances. Get a part-time job and start saving your money, your friends are going to want to go out and have fun, and that’s okay, you can spend a portion, but think about saving half of your paycheck and putting it aside until the foreseeable future and not spending any of it.

Just start developing the habit of savings and not signing up for any credit cards.

Money Question 5.

What should I do to get a handle on my student loans that are in the post-graduation grace period?

Money Answer 5:

Melisa: The first step is to make sure you know that you have all you loan information. Check your credit report for private student loans and the National Student Loan Data System for Federal student loans. Prioritize your private student loans and for your Federal student loans figure out which of them are accruing interest during the grace period.

Depending on the amount of interest that accrues during the grace period, you can contact the student loan service and ask whether you can pay the accrued interest off before it is capitalized and added to the student loan principal balance.

The first step is to make sure you know that you have all you loan information.
When accrued interest is capitalized, this will make you student loan principal large and can increase the size minimum payments. If you have room in your budget you can apply payments to the student loan interest that is accruing right now, during the grace period.

Once the repayment period starts, focus on paying off your private student loan because there aren’t as many options for deferment and forgiveness like the Federal student loans.

Money Question 6:

As a current graduate student with loans in deferment, what should I do now to get a handle on my student loan debt?

Money Answer 6:

Melisa: First, make sure you have all the account information on your student loans, and what their current status. For your student loans that are in deferment, while you are in graduate school, find out how much interest is accruing while the loans are in deferment.

There are also, certain benefits you can get by enrolling in an income-driven repayment plan where even if you have a $0 minimum payment, those would still count as eligible payments certain forgiveness programs available for Federal student loans.

For your student loans that are in deferment, while you are in graduate school, find out how much interest is accruing while the loans are in deferment.
In order to be eligible for these forgiveness programs, your loans will have to be consolidated or be direct loans. You might want to check on the status of your loans right now, on that front.

You can also, estimate how much interest will accrue on your student loans during the deferment period, and even if you can’t pay it off now, you can make a plan to pay it off before it is added to your principal.

That sums up the Q&A portion of the Money Workshop!

What are your money questions about savings, investing and paying off debt. Chime in below!

Thanks for reading!

~Melisa

(Photo Credits: Transform Philly  Church)

3 Steps To Reach Your Money Goals This Year


The only way for you to reach your money goals is the to have a solid plan for your personal finances. The good news is, you still have time to get on track with you money, this year. Here are the three steps absolutely need to take, right now.

Step 1: Identify Your Core Values and Develop Your Goals

You already know that you need to do better with your money, but where exactly should you start? First thing’s first is to identify your core values. Ask yourself, what is most important to you in your life? It may be to travel, have a more flexible work schedule, or pursuing continuing education. There’s no wrong answer, dig deep and write them down.

Developing the main goals that you want to achieve, is another important part of this first step. What are those non-negotiable goals that you want to achieve? Do you want to finally get your passport and travel to two international destinations this year, or do you still need to set up a college fund for your child? Remember to make sure that you establish S.M.A.R.T. goals that you can realistically achieve.

Step 2: Track Your Spending

Once you have identified you core values and your S.M.A.R.T. goals, it’s time to determine whether the way you currently handle your finances are in alignment. Track your spending for at least a month’s time or grab last month’s account statements to review what your spending and where you are doing that spending. This will give you valuable insight into how you need to readjust your spending and savings.

If travel is one of your core values, for example, have you set up a travel fund and are you building savings, specifically to fund the trips you desire to take? If not, then the next step will be to set up that travel fund and direct savings there.

3. Make A Plan For Your Money

Making a  plan for your money is critical to reaching your goals. Not only do you need a budget to plan your savings, investing and spending, but you also need to have a plan for windfalls, bonuses, raises and your tax returns. Set up those savings buckets so that you can direct the extra cash when in shows up, without a second thought.

When you set up Your Money Plan, it represents a blueprint for keeping your money in alignment with your core values and stated goals. It will document how you will allocate your savings and spending. To boost your travel fund, or pay off debt with extra debt payments, for instance.

Need help getting your money on track? Download these free Your Money Plan Worksheets.

Your Money Plan Worksheets

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How are you doing with your Money Goals going this year? Are you on track? Let me know in the comments below!

Take care,

Melisa.

6 Things First-Time Home Buyers Should Keep In Mind When Saving For A House

I am happy to feature this guest blog post from Kasasa.com. I have had personal experience with a Kasasa Provider and had a great experience getting a Kasasa Savings account, as well as, a home mortgage through them. Today, Kasasa.com is sharing what you need to consider when saving for a house as a first-time home buyer.


Once you have made the decision to become a homeowner, you can’t help but envision finding the home that has everything on your wishlist. Still, before you get to the fun part of house shopping, you’ll need to kickstart your savings to cover the costs of buying your first home, which will include your down payment and closing costs. Here are six  things you need to keep in mind when building those savings.

1. Consider An Affordable Mortgage

To guard yourself against buying too much house, apply the rule of 28  to your budget. When you apply this rule, your mortgage payments should not exceed 28% of your monthly take-home pay. (Use a home loan calculator to can help you run the numbers).

You can also use your current housing costs to figure out a reasonable house budget and look at neighborhoods that are within your means. This will keep your goal of becoming a homeowner within reach, without setting you up for future foreclosure. Tip: Get pre-approved from your lender, so you’re sure of your set budget.

2. Eliminate Your Debt

Getting rid of your current debt should be a top priority when purchasing a home. Paying down your debt will ultimately free up more cash to boost your home buying fund and put you in the best position possible to get approved for a home mortgage. Consider using the  snowball plan to accelerate your debt payoff. You should also continue to make your debt payments on time so that you can improve or maintain a good FICO score.

3. Get A Side Hustle

In addition to paying down debt, increasing your income will help you reach savings goal faster. Consider moonlighting to grow extra cash or use your free time to make money, just for savings, whether it’s house-sitting, or working at your favorite retail store. You can also draw on your interests, by tutoring, or by teaching a fitness class in the park for extra money, for example. Bonus: Time spent working means less time spent shopping online.

4. Simplify Your Food Budget For More Savings

Taming your food spending can reap extra cash quickly. Consider buying in bulk at your grocery store or co-op, and other creative and affordable meals, like these bean dishes, to save even more. Implementing meal planning is another way to cut your grocery bill. Any money you free up can go straight to your home buying fund.

5. Make the Switch From Your Commercial Bank

Here’s the thing: Moving on to a credit union or community bank gives you access to the lowest home mortgages around. Not just that, you get a more personalized experience and won’t treated like another number, like at a big bank. On top of saving money on the costs of your mortgage, the personal touch is a big plus, especially when you are navigating the home buying process for the first time.

6. Maximize Your Rewards

While you are saving for your home purchase, every little bit counts. Consider cashing in any checking account rewards you have accumulated or sign up for a checking or savings account that provides those extra benefits.


Thank you Kasasa.com for those great tips! Are you a first-time home buyer? How are you saving for your first home purchase? Chime in below!

~Melisa

THE FIRST CARIBBEAN STARTUP DIGITAL ACCELERATOR

First Caribbean Start Up Accelerator

YourMoneyWorth.com was selected for the inaugural, Summer 2016 Batch, for The First Caribbean Startup Digital Accelerator  held by CaribbeanStartedups.com – The Home of the Caribbean’s Startup Ecosystem.

As the founder of YourMoneyWorth.com, I joined 422 other entrepreneurs, and together, we represented the 105 companies selected for the Summer 2016 Cohort. The Accelerator took place July, 11th through July 13th, 2016, and  included a 2-day startup development program, followed by a virtual demo day for 10 selected companies.

Top 10 Startups Selected for CaribbeanStartups.com
Demo Day (Summer 2016)
  1. http://www.aquaflowjm.com (Jamaica) Water efficiency for the future.
  2. http://www.tabancabox.com (Trinidad) Curated box of local foods delivered to your door!
  3. http://www.farmslc.com (St.Lucia) Farming made simple.
  4. http://www.techbaseltd.com (Trinidad) Disrupting digital support for local businesses.
  5. http://www.thelocalapp.info (Antigua) The google maps of the Caribbean
  6. http://www.kwabosal.ht (Haiti) Destined to become the amazon of Haiti-#1 e-commerce for the country.
  7. http://www.livewireact.com (Jamaica) Transforming the face of entertainment in the Caribbean.
  8. http://www.caribbeanandco.com (Montserrat) Centralized hub for tourism and travel within the Caribbean.
  9. http://www.carryonfriends.com (Jamaica) The leading blog site for anything Caribbean.
  10. Instagram.com/plantbasedforyou (Guyana) Changing how we eat, one produce at a time.

The top ten selected startups had the opportunity to pitch their respective businesses, virtually, to Demo Day Judges: Sandra Glasgow, Founder and Managing Director of Biztactics Limited  and Founding Member of Jamaica’s First Angel Investors Network; Varelie Croes, Founder of the Liv Group and Co-Founder of ATECH; Robby Bitting, Managing Director of Marketing at Mass Challenge Boston; and Vanessa Alexandra Pestritto is Partner at Lattice Ventures.

Top 3 Startups Selected for CaribbeanStartups.com
Caribbean Digital Accelerator (Summer 2016)

First Place: http://www.aquaflowjm.com (Jamaica) Water efficiency for the future.

Second Place: instagram.com/plantbasedforyou (Guyana) Changing how we eat, one produce at a time.

Third Place: http://www.kwabosal.ht (Haiti) Destined to become the Amazon of Haiti-  #1 e-commerce for the country.

Each of the top 3 startups selected from the demo day presentations each won $3,000 in prizes to help propel the business forward!

My own experience during  the CaribbeanStartups.com‘s Caribbean Digital Accelerator was an exciting and informative one, that has provided me with even more knowledge to pursue the vision of YourMoneyWorth.com empowering Caribbean Millennials to do better with money. Even more so, I have gained access to a community of driven Caribbean entrepreneurs, who will, no doubt, be making massive impacts in tech and business within the Caribbean region and beyond.

You Can Apply Too!

If you are a Caribbean startup or entrepreneur, CaribbeanStartups.com is accepting applications for their Fall Caribbean Digital Accelerator which are due October 5th, 2016. Get more information on applying here: Free Digital Accelerator Fall 2016 

RECAP: I AM MY SISTER MENTORING EVENT

I had the honor of speaking to a wonderful group of recent women college graduates about personal finance at the I Am My Sister Mentoring even hosted by Guesthia
“Dynamic Black Girl” Jacques. The goal of the event was to provide a space where experienced professionals can share tips, mentor and network with recent college grads.

The event took place at the Amarachi Lounge in Brooklyn, New York, on Saturday, July 9th, 2016. It was an afternoon filled with networking with, and mentorship from, a range of professional women mentors, who offered insights and encouragement on navigating work-life, graduate school and self-care.

For my presentation, I covered how to handle personal finances as a new college graduate. I shared how the first step to getting a handle on your finances, is to work on your mindset around money and increasing your personal finance knowledge. Determining where you stand, financially, was another key step I shared and covered how calculating your net worth can help in setting up a plan to increase your wealth over time. The need to start investing early in your career, budgeting, the need for a side hustle and key insurance coverage need to protect their and their extended families’ assets were also highlighted.


Related: How to Handle Personal Finances As A Recent College Graduate


During the Q&A portion of my presentation, there were questions about how to get started investing and whether relying on employer-sponsored life insurance was a good idea.

Student loans was another concern for the mentees, some of which already had them and were considering financing their graduate studies, too. Of course, whenever you consider financing your education, you must determine what the starting salary for the degree program you are considering, in your planning. Seeking fellowships or using employer education benefits are other options to finance graduate school.

 


I AM SISTER MENTORING EVENT VIDEO  & PHOTOS


Other organizations supporting this event included Girls Empowerment Circle, Inc., a non-profit dedicated to empowering young women of color in NYC through mentorship; Your Queens, an organization that teaches about the dynamic lineage of African Royalty through performances at birthday parties and other celebratory events, and Jess, The Whiskey Chick, provided the music vibes. There were also vendors onsite, with Face Time offering massages and Bo and Calla providing flower crown hair accessories.

The I Am My Sister event was jam packed with fun and informative activities, and I especially enjoyed all the personal finance questions and the follow-up conversations with the mentees and mentors alike.

Did you attend the I Am My Sister Event? Share your experience below!

Thanks for reading!

Melisa.