Afford Anything - Ask Paula: How to Pay Off a $8,000 Medical Bill Without Going Broke

Episode Date: November 24, 2023

#473: Sarah has cash to pay a $8,000 medical bill but she’s reluctant to drain her savings. Should she sign up for the hospital’s interest-free payment plan? Jennie is an independent consultant but gets paid as a W-2 employee. Without access to a SEP IRA or a 401k plan, is there another option to save for retirement? An anonymous caller is wondering how to run a cost-benefit analysis on pursuing a graduate degree. Brian is getting inundated with spam calls as a real estate investor. Is there a way to stop the madness? Former financial planner Joe Saul-Sehy and I tackle these four questions in today’s episode. Enjoy! P.S. Got a question? Leave it at https://affordanything.com/voicemail For more information, visit the show notes at https://affordanything.com/episodes473 Learn more about your ad choices. Visit podcastchoices.com/adchoices

Joe, have you ever gotten a huge medical bill in the mail? Very luckily. I have not. Oh, well, we're going to answer some questions. I have. I have many, unfortunately many. And we're going to answer some questions today from a caller who is also dealing with that. And, well, I'm not going to spoil it.

So let's get to it. Welcome to the Afford Anything Podcast, the show that understands you can afford anything, but not everything, every choice that you make. is a trade-off against something else. And that applies to any limited resource that you need to manage, whether it's your money, your time, your focus, your energy. So what matters most and how do you make decisions accordingly? That's what the show is here to explore.

My name's Paula Pamp. I'm the host of the podcast. Every other week, I answer questions that come from you, the community. And this week, as always, my buddy, the former financial planner, Joe Sal C-high, joins me to answer these questions. What's up, Joe? I am here. I've got coffee.

I'm ready. And I can't wait to help some people out. Beautiful. I got a cup of coffee, too. I've got, even on the desk, I've got some macadamia milk. I've got some. Do you put that in the coffee or do you use this as a chaser? Oh, I've got collagen peptides.

I put that in the coffee as well. Because who doesn't like a good collagen peptide once in a while? Exactly. A peptide. to think you're all right our first question comes from sarah hi paula and joe my name is sarah a quick thank you to both of you for all the content that you provide you've really helped me and my family get our finances back on track just by us listening to your podcast so thank you for that i'm calling today with a question about medical bills earlier this year i was hospitalized and have an outstanding balance to our

hospital for about $8,000 because of my high deductible health plan. I'm wondering about how I should pay that bill. I have the option through the hospital to make a payment plan that is interest-free, so I could make a small payment every month, and that could go on for two or three years of those small payments, or I could pay that bill out of my savings, and while I don't love that idea, I could do it. So I'm just wondering what your thought is on that. I was wondering if it would be better to make those small interest-free payments and then to keep that larger chunk of money in my money market savings account where it is now, where it's at least earning a little over 4% or is it psychologically better to just make that payment and be done with it. So thanks so much for your

feedback. Sarah, thank you for the question. I have been in exactly the same position many, many times. a huge fan of taking the interest-free loan, you have a zero interest, essentially, loan from your medical provider. So why not make the smallest possible payment, stretch it out for as long as you possibly can, and then keep that money in a high-yield savings account, keep that money in a money market account, and you know, you're functionally arbitraging the difference between 0% versus whatever return you're getting on the money that's in your savings account, your high-old savings account. So I'm a huge fan of that. The only exception, I'm saying this not for you, Sarah, but for anybody else who's listening. There are some people. Their psychology is such that having any type of debt would cause them to just have anxiety attacks, go into a cold panic. Their stomach would clench. It would keep them up at night. So for the sake of everyone listening, if that is your inner psychology, then of course, pay it off so that you can not have those anxiety attacks. But for you, Sarah, just

based on the fact that you're even considering this, based on the fact that you ask that question, my assumption is that that is not your psychological makeup. And so I would say, if you have the stomach, the psychology, to be able to do it, hold onto that debt and make the smallest payment possible. Good news too there, Paula, is that the credit reporting agencies have changed the rules around medical debt as well. So this debt won't affect your FICO score in the same way that it might have a few years ago, which is also good news for a lot of people. And she's going to have a history of on-time payments. Right. But sometimes people worry about, hey, you know, is this going to make my utilization I? Is it going to, it will have some impact,

but not like it used to. So you won't have that hanging over your head like you might have three or four or five years ago. Right. You know, the interesting thing about this, Paula, is that we see all these stats talking about the psychological makeup of some people, that people are happier when they have no debt, just in general. And whenever somebody asks this question, I always want to know, what is this money competing against? Right. What are the other goals that this money would be used for if I don't use it to pay off my debt? And we obviously don't know that.

But I think that's important information because maybe. Maybe there might be halfway where she pays off. She pays part of the debt to get rid of the debt. Maybe there's something else that's competing with. I don't like that at all. But if the money's just sitting in cash, if the money's sitting in cash, I really want to know what the other goals are. And I'm not talking about for Sarah.

I totally agree with you for Sarah. Because I think Sarah's asking the question. and she said point blank, I don't like putting this money toward the debt. Well, then go with the 0% loan. But here's what I see on the other side. When you talk about people that don't like having debt hang over them, so then they pay it all toward this debt that could have been interest free. And there was some goal that's not interest free on the other side that we should have

probably put that money toward because that money needed to earn a return to get the goal. Well, then we're very suboptimal. Right. So, and that's why I always want to know what the other goals are that this money might be used for. Well, I mean, even if, let's just say that her goal is retirement, because ultimately everybody's goal eventually is retirement, whether or not you want early retirement, everyone wants to retire by the time they're 90, right? So even if we'll say that's her only goal, that requires earning money at a rate that's greater than 0%. Agreed. So no matter what, arbitraging that money by keeping the zero percent loan and keeping her money in a high-yield savings account, collecting that arbitrage is going to be

useful. I don't think it always is. So I do think it's different for her and for other people and knowing what the what the other goals are that we're competing against for that money. And so let's take a look at that. I mean, let's let's dive into that. Let's say that she is close to retirement. she saved nearly enough for retirement. She's even, she could even probably coast in. The happiest retirees don't have any debt. She doesn't like having any debt.

But this loan is $8,000 and $8,000 is all that she has. I would in that case say, let's take your biggest emergency, the thing that freaks people out. Let's double that number. Let's leave that number in cash. And then let's take the rest to pay off this medical debt, right? because if you're going to be happy, happier in retirement, since we're using retirement as the example, without having the debt, I still wouldn't take all of it and pay off the loan, but I would take a chunk of it so that you knew that you're three-quarters of the way there.

I think as long, for, again, with the exception of that edge case of people who really panic and really get into court. sweats about any debt. It isn't an edge case. It's most people are happier in retirement when they don't have any debt. Well, that is, yes, but that is true. But, but, but in Sarah's case, as long as she has $8,000 in her savings account, she functionally doesn't have debt. She has technically debt on paper, but she has the money to pay off her debt. So unless, unless she is that edge case of person who gets into a cold sweat about the cold sweat about the fact that this $8,000 balance is on ledger A rather than ledger B. It's still not an edge case.

It is absolutely an edge case. No, the number of people that I, when I was a financial planner, the number of people, and I would sit in your seat, Paula, and I'd say, listen, we got the money sitting right. I don't care. I want to pay it off now. Are you kidding me? This is a 0% loan.

It is totally not an edge case. It is not. There are a ton of people walking around that go, you know what? If I have the money paid off, why the hell? wouldn't I pay it off. Let's pay it off. Let's get it off the books. Psychically, I need to get this out of my brain. It does take up psychic power in my brain to have this debt, quote, hanging over my head. Even though I can tell them and you can tell them all day long, you go, no, it ain't hanging over your head. Listen, we can pay us off whenever we want. Fine. Edge case or not. If you're the

type of person, which Sarah is not, the fact that she's calling in to ask this question, she's not that person. I think we agreed on that. We agreed on that a long time ago. Yeah. So I'd say, unless you are that type of person who would get into a cold sweat, who would get the anxiety attacks, if you're that type of person, then then pay it off so you don't get the anxiety attacks. Otherwise. Let me tell you what would help with the people that are the people that break into a cold sweat. This very much helps. You know how I'd meet them halfway, Paula? I'd tell them to hook up an automatic payment so they don't have to think about it anymore. And I don't know why that helps, but that totally helps. And maybe it's the fact that I have this, I don't want another payment

every month. I don't want to think about the, you know what, don't think about the payment. Let's not think about the payment. You got the money sitting over here. It's not being used for anything else. Let's hook up an automatic monthly payment. So it automatically goes into the account it's supposed to go into. I don't know why it helps. I can't explain it. I think the reason why is then it becomes ostrich philosophy, out of sight, out of mind, right? Everything. The system is humming along in the background, and so it never reaches the level of your consciousness. Yeah. Yeah. Yeah. So I could meet people halfway there. Let's at the very least keep earning almost 5% if you've got a good high yield savings account. Let's keep it earning 5% while it's

getting zero. Just have it. Okay. Yeah. I can do that. All right. Well, Sarah, you've got your answer. And I hope that you are the type of person psychologically who can take advantage of the arbitrage because that's a decent junk of money over time. Thank you so much for calling and asking that question. Hey, Joe, does your phone number ever get inundated with spam calls? Constantly. What's great is that my provider puts a little tag that says potential spam. Ah, yeah. Yeah, a lot of them do. Well, we are about to answer a question from a caller who is not a spam caller. Let's hear it. Hi, Paula.

I've got kind of a miscellaneous question that's not really financial. It's more so related to real estate investing. Over the past three years, I've bought a couple of out-of-state single-family homes as investment properties as long-term rentals. These properties were all purchased in my own name, so no LLC or anything like that. and they're all managed by a property management company. My question is, I am getting absolutely inundated with spam calls from quote-unquote local investors asking if I'm interested in selling these properties. I'm not interested.

I tell them so, and then I block that number. However, I'm continuing to get similar spam calls at least three or four every day. I now have over 400 of these numbers blocked in my phone, but new numbers keep calling me every day with the same solicitation request. Yep. I know that you've got a number of out-of-state rentals. I'm curious what you do to minimize spam calls from local investors trying to buy your properties. Any advice? Thanks.

Paul, I'm laughing about Brian's question, because I got one of these, Brian, yesterday. Yesterday. And you know what's funny? It's a property I haven't owned in three years. Oh, man. Oh, man. And you know what? This applies not just to property owners, but also to business owners.

of all stripes. So absolutely. The moment you own assets, you start getting spammed. I think this has to do, Paula, with the public record of the property. Of property. Yeah, yeah, exactly. Property is public record. So it's easy to find a person.

But, you know, business registrations, domain names. If you own domain names, you start getting spammed. I can't tell you how many spam calls I have trying to buy various URLs from. me. So yeah, this happens not just to real estate investors, although I think real estate investors get it very, very bad, but it happens to all kinds of business owners and asset owners generally. I invested in, when I buy domains, I've invested in, and I buy them through a company that offers for a little extra fee a shield so that my personal data doesn't show up. Like it shows up is through them, you know, mysterious owners through them. Which makes me ask you this question,

Paula. So as a real estate person, does it make sense as you accumulate properties then to just invest in another phone number? It seems like a very low cost to have this, quote, business phone number where the spam goes. Well, so a couple of things. Number one, you don't actually even have to invest in that. Google Voice gives you a phone number for free. Well, there you go. So I do a couple of things. Number one, use Google Voice to get a free secondary phone number and use that as your. the phone number that you basically you'll have the phone number that you give to the general public such as the phone number that you use for real estate records and then you'll have your own private phone number that is just for family and friends and colleagues so that's one way that I do it and just for everybody listening I just found out why I can never get a hold of Paula she gave me that phone number I'm on to you now I do the same thing with email addresses The second thing that I do, there is a setting an iPhone in which any call from an unknown number automatically goes to voicemail. So rather than your phone ringing with an unknown number, it will just auto get sent to voicemail.

And then you can, of course, weed through your voicemails. And if there are numbers that you recognize, maybe your dentist called you and that isn't saved in your phone, you know, you just then save that number, right? So siphoning off calls from unknown numbers automatically. That's another thing that I do. And then finally, you know, there are occasions where I have to turn that feature off. So for example, when I was in journalism school, I was placing calls to a bunch of sources in order to do reporting for news articles that I was writing, right? So I knew that I needed to get a bunch of calls from unknown numbers.

So there were two things that I did at that time. Initially, what I did was I, I, screened my calls such that calls with area codes in the cities in which I own properties, those calls I never picked up because oftentimes spammers will call from the same area code as the property, as where the property is located, under the assumption that you're more likely to pick up those calls. And so what I do is if I see a call from an Atlanta area code, an Indianapolis area code or a Las Vegas area code, I do not pick it up. I send it to voicemail. by contrast if I see a call from an unknown number with a New York area code, I'm more likely to pick that up.

So that was one thing that I did. And then eventually over time, I did actually just get a second SIM card and a second phone number entirely. And that was specific to being, when I was in journalism school, that was specific to being in a position in which I needed to be able to pick up calls from unknown numbers. I don't do that anymore. I have since canceled the SIM card because I no longer have the need to pick up unknown numbers. So those are all the ways that I try to screen spam. Well, and it's important. I mean, you know, the great thing for Brian is as he gets more successful and adds properties,

this is going to be a problem that manipulates. And it sounds like he's already successful if he's getting these calls frequently right now. So, yeah, it's only going to get worse. Yeah. Welcome to the club. This is the price of success. So congratulations, Brian, on getting frequently spammed. Way to go.

Brian can tell people now. I'm so popular. You know how popular I am? I get five spam calls a day. The holidays are right around the corner, and if you're hosting, you're going to need to get prepared. Maybe you need bedding, sheets, linens. Maybe you need serveware and cookware. And, of course, holiday decor, all the stuff to be.

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I am 36 years old and I am an independent consultant, meaning that I have multiple different clients from, time to time. I currently have one client who wants to pay with a W-2, and they are my only and main client for this year. I'm wondering about what I can do for my retirement accounts. Obviously, because they pay me with a W2, I can't take advantage of a SEP self-employed 401K. However, the company itself doesn't have its own 401k plan. Am I just going to miss out on this 401k operational. opportunity this year of putting money in with tax benefits for retirement, or is there something else I can do? I've already maxed out my IRA for the year. I'm looking to see how else I might be

able to save for retirement without just opening a regular investment account. Thanks for any insight. Jenny, thank you for the question. So if you are a W-2 employee and your employer does not offer any type of retirement plan, your best bet is a traditional IRA or a Roth IRA. But, Jenny, you already have that. As you know, there's a glaring contribution limit, which is $6,500 that applies to you at your age. You're 36 years old. Once you are over 50, there is a catch-up contribution. It's an extra thousand that you can put in. But it's a very low contribution limit.

So that's the first thing that you can do is fully fund an IRA. But the drawback is once you've hit that $6,500 limit, you're tapped out for the year. Beyond that, you mentioned that you are an independent contractor and your main client pays you through a W-2. I assume that means you have other clients that pay you 1099 income. The good news there is that the money that you make from those other clients that pay you 1099 income, you can treat that money as any type of self-employed money. And so you can then, with the income from the clients who pay you as a 1099 worker, you can access all of the options that are available to. self-employed individuals, which are the three key ones are the solo 401K, the SEPIRA, and the simple IRA.

Joe, you're the former financial advisor. Is that what you would say to a client? Yeah, but you know what I would say even before that, Paula? What's that? Why does that employer want you to be a W2 person? Like I really, especially if they don't have a 401K, they don't have benefits, like some employers that are, you know, forward thinking and, you know, really. realize that treating your employees better matters. Maybe they've got health benefits. They got

things. They want to include you. Like that is great. But why do they want you to be W2 if you don't want to be W2? Like if somebody came to me and said, I work for other people. I just want you to 1099 me. I would say, oh, Lordy, thank you. Because it makes my job so much like the tax reporting on their end, all the stuff they got to fill out that's state-specific is just so, it would make their job so much easier. Oh, yeah. We had a W-2 employee from the state of Alabama once, and the state, oh my goodness, for years after he left, we were just being hounded for paperwork by the state of Alabama. Because no matter how many times we tried to tell them, we don't have any employees from the state of Alabama, they were still like, we need quarterly taxes.

And we're like, we don't have any employees there. And it was, it was a nightmare. So yeah, the state reporting requirements when you have a W-2 employee is just a job unto itself. So I think there might be a conversation opportunity there to say, to say, hey, you know what, I would much rather be 1099. But we don't know. Maybe she gets health benefits, right?

maybe the function of being a W-2 employees that she gets health benefits from this particular client. If she does, yeah, then there's a reason. Right. But just from the evidence we had from that call, she's like, for whatever reason, they may be W-2. If you don't want to be, then I might talk to them about how much in their favor. You know, when you enter into discussions like this or any negotiation, it's always best to argue from the other person's point of view. Right.

So if you can make it a win for them to do the thing that you want, that's way better than going to them with something than talking about your side. Right, right. Yeah. Here's why it would be easier for you. It would be cheaper for you. It would be less reporting for you. It would be less onerous for you. Yeah.

But if there is a reason, Paula, I think you, I think you nailed it. You can look at things, you know, like the solo 401K is pretty cool as well as the SEP, the simple. Good stuff. The types of retirement accounts that are available to you, if you have access to an employer-sponsored plan, are far more restricted. But in your situation, given that you do not have access to any employer-sponsored plan, that completely opens up the window for all retirement accounts that are available to self-employed individuals. The key is that that can only be funded by the money that you make. from your 1099 income. So you'll need to have both sources of income, your W-2 and your 1099 income. If Jenny has the worst-case scenario,

and she has to do what she alluded to, which is just open up a brokerage account and save money there because she's capped out. Right. I do some good news for Jenny, which is, while that is suboptimal, the degree to which it's suboptimal is a lot less for most people. than I think that a lot of people in our community allude to.

We really go a little overboard on some of the tech stuff. Because if you are an investor and not a trader, Jenny, if you're a trader, you're going to be churning taxes and you're going to be throwing off a lot of different things. But if you're in an exchange traded fund or a mutual fund that's based on an index, it will sometimes throw off usually a very, very, very small. tax bill and don't get me wrong that's friction and if you did have it inside of a IRA or a solo 401k or a SEP or simple whatever it is sure that would go away it's not as big as people think it is

Paula if you're a buy and hold person it's not a ton of friction so don't let perfect be the enemy good right yeah I would save the money into a brokerage account be very happy with the upside of that which is now you can get at that money whenever the hell you want. I don't have to worry about the IRA rules. Hey, it's flexible in which there's so many times, so many questions we've answered in the past, Paula, where flexibility has won the day. Right.

Exactly. Exactly. So the glass is half full, Jenny. I mean, technically the glass is entirely full because it's got both water and air. Only Paula Pant would say that. That's fabulous. But no, I agree. I'm a huge fan of taxable brokerage accounts.

You know, if you can get a tax advantaged account, great. But if you can't, taxable brokerage accounts are wonderful as well. I've got loads of money in my taxable brokerage account. And I happily pay the tax bill because I know that I've, you know, I've got the, like Joe, like you said, I've got flexibility with. the money that's in there. And over the span of a person's life, you want to build out that tax triangle, where you've got the three points of the triangle, taxable brokerage, tax deferred, and tax exempt, right? Over the span of your life, you want to build that out. But if in any one given year, you have to put more money into one of the three points of the triangle, okay,

you know, that's one year, right? It's one year out of decades and decades of building out that tax triangle. You'll have other years to compensate in other ways, you know, in the other points. Yeah. So thank you for asking that question, Jenny. And congratulations on what I hope is otherwise a good client to have. Yeah. Absolutely. Black Friday is here at IKEA and the clock is ticking on savings that you won't want to miss. Join IKEA family for free today and unlock deals on everything from holiday must-haves to cozy at-home essentials,

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to one of my favorite podcast episodes. I like her, this woman wherever she is, she's a comedian named Aisha Tyler. I saw her on the main stage at a podcasting conference and she kind of changed my, just my viewpoint on podcasting and was really influential and in so many ways. But she was interviewed on Tim Ferriss's podcast. And I think I've listened to that interview maybe five times. And I was listening to it this morning. And as just a powerful woman, I've had the opportunity to listen to what we're about to hear. And I think Aisha is probably a great name for this caller. Okay, perfect.

All right. Well, then our final caller today, who is Anonymous, we will name Aisha. Hi, Paula. This is Anonymous. I'm a big fan of the pod, especially these Ask Paula episodes. so thank you for doing them. I always learned so much. I'm calling because I need help figuring out if I should pursue a graduate degree and how I should go about it. Here is some helpful context. I have an undergraduate degree in Africana Studies, which I love and would do again if given the

chance. I focused on the intersection of art and politics in the Black diaspora, and thanks to this degree, I got to pursue so many dreams, including living and studying in Ghana, working on an exhibition in South Africa, spending years working at world-renowned media and cultural organizations, and falling in love with marketing through my work at a history-based research institute. I am now 10 years into my career, and while I've had a ton of fun and learned a lot, I've also experienced a significant amount of discrimination, both because of my race and my gender. I even went through a grueling, year-long public fight with a deeply racist and sexist VP at a prominent media org that ended up with him getting fired by the board and

all of the top leadership of the org being replaced. I am tired of fighting so hard, and having to work 10 times harder than everyone else, only to find out, I'm being paid half as much as white male colleagues doing the same exact work, even though I scored highest on the annual performance review. I'm exhausted, and I feel like taking a step back to study, get an MBA, and gain credentials that are valued in the workplace could help me advocate for myself even more, and more importantly, get seen for the value that I bring. I'm 10 years. in and I am confident that I can do any job and reach any heights, but I am not sure I can continue fighting as hard as I've been. In my mind, getting an MBA means removing one more

obstacle for my path. Is it worth it, though? I've identified an online program at a top 50 business school that would allow me to keep working full time and that I can pay for easily out of pocket. Is it okay to not shoot for the top? Is it okay to put financial stability ahead of prestige and brand name? Will I regret not choosing an in-person program and at a more famous school, since everyone is telling me the point of an MBA is the network. Truthfully, I don't want to do a full-time program,

even if I were to get a full ride. I not only love working, but doing the affordable part-time program would be less money in the long term. I just don't want to feel like I'm choosing the easy way out instead of the smartest way. Thank you so much in advance for your help. Thank you for that call. I'm sorry that you're in the same.

situation to begin with. So let's figure out what to do. All right. So to your question, I hear two questions in here. Is an MBA the best next step? And if so, is this specific online program the particular MBA that you should choose or should you opt for a more prestigious MBA that would be a full-time in-person program? We'll start with the premise of the question, which is, is is an MBA the most optimal next step? On that question, I'm torn. On one hand, credentials can be a form of armor. Traditionally accepted credentials are a way, it's a shorthand way of saying, hey, look, I'm qualified. There's another factor I think we have to also talk about, which is many of the women that I'm surrounded by also get asked questions

that frankly, Dave Ramsey doesn't get asked because he's a white dude. Like there are questions that when I've been, and I've been co-host on different podcast with women and the judgments about the women and the questions they're asked are questions that I've never been asked, right? Like what? Like credentials to be on the show, right? The, So why you? And by the way, and also just some of the gross discussions about the appearance of my co-host or the tone of her voice that I would never get, it is deeply disturbing and frankly weird and in some ways disgusting. So I think there's also that, Paula. But Dave just, you know, Dave's a guy who sounds like he knows. what he's talking about. If he's a dude who knows what he's talking about, nobody asks the question, you know, hey, I'm the voice of authority. I put this little tone of my voice. I'm a guy who looks

like a guy who has done it, but Paula Pant comes along. Well, who the hell are you? What is, what is your authority to be there? Right. I did it. You know, I was featured by CNBC in this, this video and if you read the comment thread, I mean, it's just hundreds and hundreds of comments of people saying, oh, how is she a personal finance voice? You know, oh, oh, I guess anybody can just be one, right? Like, because there is nothing formal in my background that gives me a formal credential in finance or economics all the comments on the

CNBC video were like well geez I guess my dog can be a personal finance commentator so yeah so to your question Aisha one of the reasons that I did go to Columbia I mean there were many reasons

but one of those reasons was because I wanted to be able to say look I have a degree in economic journalism, business and economic journalism, from an Ivy League institution. So no one can really ever question that credential now. Now, does it matter? I don't know. Sometimes I think it matters in my own head more than it does to other people.

Which I think is not not important, by the way. I mean, excuse the double negative, but I think that is important. I think when you show up with this, this, yeah, you're not going to. going to question me because I've got this background. It gives you the confidence to continue the fight. Like, you can hear how tired she is, right? Yeah. Yeah, exactly. So confidence is everything. Yeah. Well, and Joe, to your point, what, you know, when you said, hey, when you show up and you speak with complete authority and you're like, I'm, I'm Dave Ramsey and this is what I believe, right? People really respond to that display of confidence. You look at Susie Ormond, right? She is arguing.

the most successful female in the personal finance space. And what does she have? Absolute confidence and absolute authority. You know, Susie, what do you think of the fire movement? I hate it, I hate it, I hate it. Right? She came onto this podcast. She came onto a fire podcast and said that with so much authority.

And yes, it generated a backlash. But you know what? She's Susie Orman. She stands up to the backlash because she's Susie effing Orman and she says what she thinks. Yeah, what's interesting about that, Paula, is that if you actually look into Susie's background and you see how checkered her background is and how a lot of that is, is her bravado. It has nothing to do with getting another MBA about getting more education. It is just Susie having that armor that presenting herself in a certain way that did it.

Yeah, exactly. And so that's why I'm torn on the question of, will an MBA be helpful? because on one hand, I think if it generates confidence, then yes, it could be helpful. On the other hand, an MBA is a time-consuming and expensive way to generate confidence, right? Ultimately, people respond to bravado. They respond to chest up, shoulders back. I'm going to look you square in the face. I'm going to, you know.

Yeah. You know, that is, that is, that is my initial reaction. And, you know, it's easy for me to have a reaction, right? Because I haven't gone through a lot of this. So my experience, you can take or leave. This is kind of, this is kind of an offshoot, though, about what I talked about on the main stage of FinCon when I was doing the closing keynote about some of this stuff.

But I think what Aisha needs to embrace is that all the degrees in the world are not going to make a, not be a. Yeah. Yep. Yep. 100%. The does not care how many degrees you have. The racist doesn't care. The sexist doesn't care.

Yeah. It does not matter what you have because it's not about you. It's about them. Yep. Uh-huh. Yeah. And so, so I have a coach, a good coach and, you know, I very strongly believe in having good coaches around you. And Mary Lou has told me over and over, Joe, that's a cluster of misery.

Get the F away from it. Stay away from clusters of misery. Clusters of miserable people doing negative work, living in negative spaces. And once again, that's easy for me to say. It's hard to actually do. So I want to acknowledge that that's not an easy thing to avoid clusters of misery and miserable people. The good news is, though, there are groups of people working together who are the opposite, Aisha, of what you're going through, who are empowering, who are helpful, who have each other's back, who want to see each other succeed. those people are out there.

And I don't think that's a degree. It's a pain in the a bit to go find those people and to keep searching and searching and searching for this holy grail of these people they're going to empower you. And that's not to say the MBA is wrong either, Paula. I'm as torn as you are because the MBA could be a great thing. I think what we're asking is,

what's the ROI you're searching for? Right. Right? Well, and I think, So, Joe, I completely agree. Like no, no amount of degrees is going to, you know, you can't reason with an unreasonable person, right? You could have a Harvard MBA and a PhD, but if someone is going to have preconceived notions, they're going to have preconceived notions.

And not even a Harvard MBA will solve that. But that being said, A Harvard MBA does also build your network. It builds your connections. It gets you a foot in the door in a lot of places. It is a shorthand for saying, I belong in this club. You actually literally can join certain clubs. Like in New York City, there are clubs that you can belong to, literal, actual physical clubs,

that you can belong to if you have an Ivy League degree. right? So it does quite literally open the doors. So that's why I'm torn because there are so many doors that do get opened by virtue of getting a degree and specifically where you go to get that degree. There are many doors that do get opened from that. And there are people that you meet that you would otherwise never have access to. And it is purely because you have that credential because that credential is just in a business. society, that credential is a shorthand for, hey, I'm qualified. Let me in. So that is the argument in favor of it. But by contrast, I mean, the argument, you know, the argument on the other side is, to your point, Joe, you can't reason with an unreasonable person. Some people are simply going to wallow in their biases. And the only way to stand up to that is with that Susie Orman level confidence. On the subject of confidence, there are really two elements to consider. There's internal and external. And external, you know, you might argue what's the distinction between

confidence and credibility, but I do think even when we are talking externally, there is a distinction between the two. So let's discuss both. When it comes to external confidence, there's a spectrum, right? There are certain people who, on one end of the spectrum, will always doubt you no matter what, and it doesn't matter what type of evidence they're presented with because they are not operating from their prefrontal cortex, they are operating from their limbic system, which is another way of saying you can't reason with an unreasonable person. And so those people on one end of the spectrum will never be convinced regardless of any amount of evidence. On the opposite end of the spectrum, you also have people who are

cheerleaders and they are inclined to always see the best in everyone and to always be hopeful and to always be empowering and their confirmation bias is that they want to see you succeed. They want to see everyone around them do well and succeed and do good. those people will always be out there too. And then, if you think of this as a spectrum, in that middle portion of the spectrum, you've got people sort of somewhere in between those two extremes. And most of these people, in that middle portion of the spectrum,

are relatively reasonable. Certainly, they have their biases, we all do, but they are also pretty reasonable people. Right? So if you think of that as a spectrum, of the type of people that you'll encounter. The confidence that you have in your interaction and the confidence that they have in you, I think that confidence can be aided by getting this MBA, by having this piece of paper

that gives you increased credibility. So that's the external world. But then, then there's internal confidence. And that internal confidence is how you feel about yourself. Forget all of the other people who are out there in the world. When you are alone, how do you feel? When you're looking in the mirror, how do you feel about yourself? And again, I think that oftentimes getting that piece of paper,

your true value is not the fact that you took a few classes on corporate finance and now you know how to construct a P&L statement or read quarterly reports. Its true value comes from the way that it enhances your internal sense of confidence. I think for Aisha too, there are two ways in the future to think about this fight. On one hand, there is hand-to-hand combat with stuff that's wrong is absolutely 100% wrong. And I think fighting that is brave and noble and also is probably a big source of where the tired comes from in Aisha's voice, right? Because that is a tiring ass fight. I can't imagine going through what she went. The whole executive team, Paula, gets fired. Right.

Like think about your psyche. Right. Like that is a fight. That is a fight. There is a second way to battle this as well. And I talked about finding these empowering people. Another way to do it is to find these empowering communities and isolate these asses and is these asses find themselves more and more isolated by people that want to empower each other. All of a sudden they're like, oh, I'm the bad guy. Well, yes, you are. Yes, you. Yes, you are. Why does nobody want to work with me? Well, guess why nobody wants to work with you. Like maybe they get the message. Maybe they don't, Paula. maybe there's something where they need this attention and the negativity is the way that they feed on that.

But it makes me very happy to not feed that, to not feed that. And by the way, and I'm not implying at all that Aisha did that in the past. I'm saying there is another way to fight this, which is to go, I'm not playing this game. I'm walking away from this game. I'm going to play a different game. But in the context of a career, you have clients, you have bosses, you have customers, you just, you have people that you have to interact with and they have to believe in you. Yeah, which means if she's not getting that, and as I mentioned before Paula, it ain't easy.

But letting that group go, if you're not getting that, to find that place, that's an MBA on its own. that's a whole that's a whole MBA just searching for this searching for this community in this job and these people that are going to give me that are going to feed me that way those organizations exist you saw it in uh jim collins work good to great seen in tom peters work you see it in a lot of these organizational experts work about organizations getting ahead there's exciting empowering places out there i can't imagine the place she was working Right. Was doing well.

Like, you know what I mean? I feel like groups that feed that also, I'd be very interested to know what organization it is to see like what their financial results were because I just get this feeling that competitively gets very difficult to compete. Like those short term things people do, you know, maybe it works for a month or two months or six months. But that just wears on an entire organization. Right.

I got to believe if the old management team got fired, it wasn't just Aisha who's feeling this. Right. Even though she was at the forefront fighting it like there's other people. My daughter worked for a company where she was the last person in her division to quit. She thought her boss hated her. And it got to the point, it got to the point, Paula, that she realized that it wasn't her when everybody else started to quit in the order that had this particular boss. Everybody else quit. And Autumn was the last one.

She was the last one. And by the way, on Autumn's last day, have I told you the story? On Autumn's last day, I was going to help her move out of, out of her apartment and leave town to go to her next job. Her boss told her she couldn't leave until 5 p.m. Wow. On her very last day. And I gave Autumn the advice. I said, you tell your boss, I'm leaving whenever the fuck I want.

You are literally not the boss. of me now. I mean, that's what a jerk this person was, but nowhere near what Aisha's going through. But that organization, my point there was that organization, you could see it in their financial results. If I told you the name of the organization, you would go, oh yeah, that organization was known for having turmoil. You could see it in the end product. You could see it in the people that work there. It just bled ugliness. this. Ayesha, to your two questions, should you get an MBA and if so where?

As to the question of should you get an MBA, I am 50-50 torn. I think there are strong arguments in both directions, strong arguments in favor of doing so, strong arguments in favor of not doing so. I don't have a position on that. But to the second half of the question, if you do get an MBA, I would strongly recommend go to the best place possible, the absolute best. Go to Harvard, go to Yale, go to Cornell, go to Columbia. I spent when, in my year at Columbia, I was in a particular fellowship. I wasn't admitted just as a traditional Masters of Journalism student. I was admitted into a fellowship for specifically

business and economic focused reporters. And within this fellowship, you could choose between three different tracks. Two of the three tracks have you taking most of your classes in the business school. One of the three tracks has you taking most classes in the journalism school. I took the J-school track, but because of the fellowship, I had a lot of time that I spent with the business school crowd, CBS, they call it, Columbia Business School. And so I got to really see the inside of that. And as you said, Aisha and your question, there, I mean, there's so much networking. They're much, much more social than the J-School crowd.

There's just, there's a lot of networking. There's a lot of relationship building. You know, you're not going there to learn accounting. You can learn accounting from watching YouTube videos. You're going there to have access to people and groups and, like I said, literal clubs that you could never join otherwise. And often in these, uh, in those communities, Paula, you know, when I talked about finding the, the better, more enlightened, maybe, uh, places, that those are great networking groups to find those, uh, people and to avoid those clusters

of misery. Yeah. Absolutely. Yeah. And there, there are some incredibly impressive, very, very inspiring people there. Just, I mean, person after person just blows me out of the water. So I don't know whether or not you should get an MBA, but if you do, go to the best. The magnitude of impact is 10x, if not 100x greater. Well, Joe, we've done it again. Wow.

Another episode for the books. Joe, where can people find you if they want to hear more of you? Oh. You can find me. Were you surprised by that question? I've got a great place, Paula. The Stacky Benjamin show every Monday, Wednesday, Friday, we call it the greatest money show on Earth.

It is meant to be a circus where we present you with ideas on four or five different topics. On our Monday Wednesday shows, we have a phenomenal roundtable featuring the amazing Paula Pan on Fridays where she is in the thick of, by the way, our trivia contest, for the year. It's coming down to the end, and man, is it close? So if you're into competitions that mean nothing. And I certainly am. And some pretty darn good financial talk. That's at Stacky Budgeman's. Oh, fantastic, fantastic. Well, thank you so much for tuning in. If you enjoy today's episode, please share it with a friend, share it with a family member. That's the most important thing that you can do.

Chat with our community, too. We have a great community, afford anything.com slash community, where we have different villages where you can organize around topics that you're interested in, whether it's paying off debt, saving for retirement, buying a rental property, anything. You know, we've got these little villages talking to other people in their 20s, 30s, 40s, 50s, 60s, any topic. Come to our community, afford anything. com slash community.

Thank you so much for tuning in. My name is Paula Pant. This is the Afford Anything podcast. Oh, and you are? I am. Wait a minute. Hold on. Joe Salsi hi.

Ha ha. And this is the Afford Anything podcast. And we will catch you in the next episode.