Afford Anything - Timeless Financial Lessons from My Grandma, with Michelle Singletary

Episode Date: September 21, 2020

#277: Michelle Singletary writes The Color of Money, for The Washington Post and is a winner of the prestigious Gerald Loeb Award. Her column is syndicated in more than 100 newspapers nationwide. She’s the author of three finance books and holds an MBA from Johns Hopkins University. But her strongest financial education came from her grandmother. Her grandmother raised five grandchildren while working full-time as a Nursing Assistant at a hospital. She earned $13,000 per year, but never took welfare, was never late on a bill, and “handled her money like a pro.” In this podcast episode, Michelle shares timeless financial lessons she learned from her grandmother, including: Save from every penny or dollar you receive Live below your means Hate debt like it’s the devil Save for the future Don’t buy more than you can afford Don’t care about what other people think about what you wear or drive Michelle’s grandmother taught her resourcefulness, humility and the value of a strong work ethic. Michelle joins us to chat about the financial independence retire early (FIRE) movement, emotional spending, how her experience growing up poor gives her a unique perspective in financial media, and the falsehood behind the phrase “it’s not what you earn, it’s what you save.” You’ll enjoy this episode if… You’re new to the world of personal finance or FIRE and want to learn more about the basics. (#lessonsfromgrandma) You can’t relate to some of the discussion around FIRE because it seems unachievable to you. You love down-to-earth guests who tell it like it is. For more, visit https://affordanything.com/episode277 Learn more about your ad choices. Visit podcastchoices.com/adchoices

You can afford anything but not everything. Every choice that you make is a trade-off against something else, and that doesn't just apply to your money. That applies to your time, your focus, your energy, your attention, any limited resource that you need to manage. And that opens up two questions. Number one, what matters most to you? And number two, how do you align your decision-making, your daily, your weekly, your big-picture

life decisions? How do you align everything in accordance to that which you prioritize? Answering those two questions is a lifetime. practice, and that is what this podcast is here to explore. My name is Paula Pant. I am the host of the Afford Anything podcast, and today, Michelle Singletary from the Washington Post, joins us to talk about timeless financial lessons she learned from her grandmother. Michelle Singletary writes a Pulitzer nominated personal finance column called The Color of Money for the Washington Post. This column is syndicated to more than 100 newspapers nationwide. She's also the author of three finance books

and holds an MBA from Johns Hopkins University, but she says that her, her Best financial education came from her grandmother. In the interview that you're about to hear, Michelle shares many of the lessons that she learned from her grandma, including saving from every penny or from every dollar that you receive, living below your means, not buying more than you can afford, not caring about what other people think, and hating debt like it's the devil. We originally aired this interview in 2018, and we are rebroadcasting it right now as part of our September sabbatical series.

So during the month of September, I take the month off from creating new content, and we share some amazing episodes from our archives. Ones that if you're a new listener, you might not have heard yet. And if you're a long-time listener, you last heard it back in 2018. We got great response from the community when it first aired. I'm looking at the comments right now. Iris said, this is my favorite so far. Droh said it connects with everyone at every level. Gail called it down to earth and compassionate.

So people loved this episode when it first aired, and I hope that you feel the same way. So with that said, here is Michelle Singletary from The Washington Post sharing the financial lessons that she learned from her grandma. Hi, Michelle. Thank you for coming on the show. Oh, it's my pleasure. Michelle, you have been writing about the financial independence movement for the Washington Post. I'd love to talk to you about how that began.

But before we get there, please introduce yourself a little. How did you start writing about money generally? And how did you become interested in this topic and what led you to writing about money for the Washington Post? I was hired by the Post to cover bankruptcy. I worked for a paper in Baltimore, the Baltimore Evening Sun, my hometown paper. They were looking for someone to cover bankruptcy issues. So I went to the Post and started covering bankruptcy, then banking, small business. I'm a very frugal person and I have a newsroom of people who are not necessarily frugal.

And so I'd bring my bag lunch and they would all want to go out to lunch. You know, Washington is all about do lunch. And I was like, nope, can't do lunch. Too expensive. And then I would just talk about stories about my grandmother and my editor. It was like, you should just write about all the things that you learn from your frugal grandmother. That was like in 19. I don't even know what I want to mention the time of the year.

But I started writing about the things that my grandmother taught me. And it just as if everybody was like, thank. you because, you know, the business sections were always these areas where regular people didn't think was for them. And so the way I wrote it, you know, very simple about the things that I learned from her and how to handle your money really resonated with the readers. Shortly thereafter, I was given a full-time column and then the column was syndicated by the post. And I've been writing it like that ever since. So back in the 19 somethings, we're going to assume it was the 1990s. It was fairly revolutionary at that time, as you mentioned, for business pages to write about issues that related to the average middle class person.

Why was that? Was that by design or was that a series of early decisions that then became entrenched? I think the business section was always looked upon as the section that businessmen read. And so there was an inclination to write about the stock market and how to start a business and, you know, all sort of very heavy, heavy financial issues. And so regular people with regular jobs didn't see themselves in those pages or anyone sort of talking to them. And so I think it was a welcome relief for people to have someone talk about, you know, what is it like to grow up poor and then have a little bit of money? How do you handle that? Or how do you handle that? Or how do you? you handle money with your spouse or how do you teach your children about money? You know, the thing about money is, especially the business sections, they kind of focus on investing and things like that. But once you put your money in your retirement plan and sort of set it, then you don't really have a lot of interaction with that, but you do have a lot of interaction with the day-to-day money decisions that you have to make with your budget and really fighting off the urge to spend more

than you make or live below your means. It's those topics that people struggle with. Now, they do struggle with investing. Not enough people do it, but it's the thing like, you know, I've got to go to a wedding and I really can't afford to go, should I go? Or there's a family reunion this summer and it's really expensive and everybody in my family's like, you've got to come, you got to come. Or, you know, destination weddings, which I hate. You know, my cousin's saying, if I don't come, I don't love her, You know, those kinds of things that speak to people. And really, it's those issues that keep people from finding the money to invest. Or it's those issues that the fire movement we talked about all the time.

You know, why can't you live on less of your salary? It's because of all those issues. If you grew up poor and you now have a little money and you hate it being poor, you no longer want a discount shop. You don't care if it's not on sale. You want all the fancy shoes and purses and the big house and the car because you remember what it's like not to have. But you can't live like that and save and retire early. And so I try to write to kind of get people at that end and then sneak in stuff about investing and the stuff that, you know, makes people's eyes glass over.

So what you're talking about really is the beginning of that merging of personal finance with the traditional business press. And what strikes me when you talk about this is that the 1990s was also when the millionaire next door was published. It was also when your money and your life was first published. So it sounds as though that decade had a bit of a personal finance revolution. It most certainly did. And it was the best thing that ever happened to our business pages because it opened the door to regular people. When they did surveys of what sections people read, business regular folks was always less. I mean, or, you know, next to last. It was, of course, sports and then maybe entertainment in the front page.

But we were like way back there because like, oh, no, that's not for me. But I think to their credit, my editors and editors across the country realized just busts on their own personal experience that people were hungry for personal finance news and information and advice. They don't know what to do. We often like to criticize everyday people for how they handle their money. They don't doing well, they don't know what they're doing. But the fact that the matter is, you know, personal finance is not your grandfather. You know, that commercial is like it's not your grandfather's catar like anymore. It's not like that anymore either. It's so much more complicated. I mean, we have all these different hybrid of mortgages. Back in the day, it was just one type of mortgage.

That was it. You know, one type of car on one, you know, you either had a pension or you didn't have a pension of Social Security. You didn't have 401K, 4-3B, TSP, annuities, Roth, Cyrus, Whole life insurance, life insurance. I mean, there's just so much to sort through. And lots of the papers realized that people needed help and guidance. And I think it was a great thing for regular people. You started by writing about frugality lessons that your grandmother taught you. Where did you expand from there?

What topics did you expand to from there? And why? When I started in my column, I was in my early 30s as a new. wife shortly after a new mom. And so I've actually taken my column through my lifespan. So initially, a lot of the columns were about how do you negotiate things with your spouse and raising children and saving for college? And all the personal finance issues that involve how to buy a car, how to not get ripped off when you buy a car. Do you need whole life or life insurance? All those kind of life issues. And then as I've become older and more season, I find my

I'm writing much more about pre-retirement, retirement, the second stage of your life, just as if anybody else would be going through this. Because a column is a very personal thing. It's who you are. It's not the same as reporting. You know, you're kind of getting into what your beliefs are. And I've used that to talk about, like giving, for example, you know, that it can't just be all about you.

Why are we rushing around? Like, my husband, I believe, in timing and, you know, giving. a percentage of our income to charity. And so the column has evolved as I have aged into issues that a large swath of the population is interested in right now, which is retirement. So let's talk about that. First, why are so many people interested in retirement right now? Are more people interested in retirement now than 10 years ago? Well, obviously, because the population is aging. We're going to have more seniors than young folks. And, you know, this world has always been geared towards the young. I mean, TV advertisers, we've got to get the young folks and actually ignoring people who are older who actually have the money to buy the stuff that they're trying to pitch. And so because we have a population that is aging quickly, we have boomers are coming into retirement and then also many coming into money. I think people are starting to understand that this is a topic that they have to pay attention to. And it's a topic for old or young because we know that the Social Security system,

needs to be fixed. It's not broken. It's not going to be broke, but it's definitely going to need some major fixes. And we also know that you can't just live off of Social Security. Or if you do, it's a very low living standard. And then we also know that pensions, although we like to make it sound as if everybody had a pension, of course, everybody did not. But a percentage of the population had pensions, well, that's going away. And so if Social Security's in trouble and more people don't have pensions, that three-legged stool that advisors would always talk about your savings, pensions, Social Security, now is really just one-legged, too. There's a unicycle, right? So you have to do more for yourself. And that's a tremendous amount of savings. And the early you start,

as everyone in the fire movement knows, the more you'll have. Well, that's not how it's been. I mean, you kind of did your thing as a young adult and got married and had kids. And then you're like, okay, it's time to retire. I got my social security and pension, maybe a little bit of my savings. You can't wake up like that at 50 and say, oh, my bad. And so I think that's why there's a lot more interest in retirement. And there's a lot of us who are trying to get the younger adults to start earlier because the earlier you start, the less you have to save.

And we also know people are living longer. And there's long-term care issues. So there's so much more you have to deal with financially at the end of your life than it used to be. I mean, really, the lifespan was so short that you retired and, you know, less than a decade later, you were no longer here. But now we're talking 20, 30, maybe even 40 years in retirement. That's a lot of money to take care of yourself. You recently wrote about the fire movement and it got a lot of attention. You mentioned to me in an email that you got a lot of.

comments, you got a lot of emails, there was a lot of feedback that came from this article about the fire movement. Why? Well, a couple things. I've been writing about fire for a while. And of course, the post at one point featured Mr. Money Mustache, which is sort of like the poster trial for the fire movement. And then, obviously, your podcast was Susie Ormond, who likes to people like and listen to and were, you know, a little taken back by some of the things that she said. And so it was a combination of all of that. But there is also a lot of interest from particularly young adults about retiring early. And it's so interesting because older adults are like, oh, those rippersnappers, they don't want to work, you know, but I think they have it absolutely right. You know, I'm coming

towards the last part of my career. And I'm thinking if I could have retired 20 years earlier, I might have to because what the young adults are getting is that there is nobody loyal to you right now. You could work for a company for 30 or 40 years and they have a layoff and you're gone. And so they're saying, I am not going to spend all in my life at an office for, you know, eight, nine, ten hours a day with not a lot to show forward at the end because you're not going to have a pension. And I want to live. I want to travel. I want to be there for my children.

I want to volunteer. And I think they have it absolutely right. The thing is, the trick is you've got to, you know, have some balance, right? You've got to make sure you've got enough saved. you're doing it right. But I would love for my young adults to have that same perspective that when I was coming up, my grandmother was like, you work for the company forever no matter what, no matter what they did to you, you just stay loyal to them. I just don't think that's the case these days. Companies are not loyal to their employees, nor should you be to them. Now, that doesn't mean that you don't put in a good day's work,

that you don't work as hard as you can. When you're at work, I'm a hard worker. I believe that I'm going to do what I need to do to help my employer, but I don't owe them my life. And I think that's what a lot of people are saying. So when they say they want to retire early, it's not a rejection of work. It's actually an acceptance of life. That's beautiful. It's not a rejection of work. It's an acceptance of life. Yeah. It's true. I mean, how many times I work my schedule so that I could be a lot of my kids' functions. I work home. And so I did that on purpose. If I couldn't have, I would have been a stay-at-home mom. But I've been to events where not a lot of parents could come.

And you see their kids looking for them. And I never wanted my kids to be on stage or on the field and look and not see me in the stands. And it's very stressful trying to get off work to get there in time. Or just volunteering during the middle of the day or going on there's field trips. All of that stuff you miss by working so hard. Now, of course, a lot of people don't have that. choice. But if you can structure your finances so that you have that choice, there's nothing like being in anyone else and your kid tilts their head, because you know, they always say,

oh, you don't have to come, but that's not true. So they tilt their head ever so slightly to look to see if you're there. You see them look. They act like they don't look, but there's nothing like that. And that's what they'll remember that your presence. They're not going to remember that you stayed at work to 9 o'clock at night so they can have an Xbox. They're going to enjoy the Xbox, no question about it. But at the end of the day, you want them to have a connection with you that is more than that Xbox. You're in a very unique position to hear and read a lot of comments from people who are not

personal finance nerds and they're not in the fire movement. When I hear from people, the people who I hear from self-select as the type of people who would listen to a personal finance podcast or read a personal finance blog. It's a very specific crowd, whereas you get, being with the Washington Post, you get comments from a much broader audience that represents mainstream America. What are some of the both positive and negative things that people are excited about with regard to financial independence and early retirement, as well as things that people worry about or object to? So from regular people, the pros is that they see a way out of the grind. I actually love being in my position, but just for what you said, I hear from every walks of life, the experience financial folks and people who are like, I don't even know how to balance my

checkbook. And, you know, it's so interesting because we think that the more experienced people know or just great at their money. And that's not all. always true, like might be a doctor listening, for example, and they're a great doctor, horrible with their money. And so I like the probe that every walk of life, those people who are interested in this early retirement or trying to downsize their life, have a mission. And their mission is, I want to work, I want to say, but I also want to just live a great life. Now, the cons is that lots of people don't think that they can do it. And there's a lot of criticism of this movement. And you and I talked about this one. We did a Q&A for my post newsletter that there's a lot of people who say, oh, well, the people in the primary movie, of course they can do that. They are techie people. They're making six-figure salaries. You know, they're doing podcasts. They're watching money. So they're really not retired. When they do that, though, when they discount those. sort in the fire movement. And as you and I talked about, they're not all techies and not all people

make the six-figure salaries. It gives them an out because they say to themselves, well, those people over there are not like the rest of us. And so therefore, they're at aberration. There's no way I can live on less money. There's no way I could do this. And they really feel bad about themselves because they feel as if they can't do it that the fire movement is looking down on them. And I think that's the wrong way to look at it. I think. think that they can do it at almost any income level, not all. And when you look at the essence of the movement, what I'm really saying is, do we need all of this stuff? Do we need this huge house, this big core, these private schools? Do we really need all this? Because if we don't scale back,

we will be working towards 70 or 80 and still not have enough. Because as you earn more, you spend more, And so you're still not achieving the goal of saving. And I think they shouldn't criticize the movement and look at it as a criticism of their life, but yet look at their life and see what can I scale back? Okay, maybe I can't retire in my 30s or even 40s, but maybe I can retire in my 50s and mid-50s or as early as 60 and have enough money to live on for the next 30 years. Maybe I do make just 30,000. I am just skimming by, but perhaps rather than having a house by myself, maybe we do shared housing with myself and maybe a sibling or another family or move to a different area or cut out the cable or not eat out so much. Rather than look at I can't do that, think about what I can do.

Having the column and being able to talk to both sides allows me to just have people examine their biases to see. whether or not it's really them saying and feeling like they can't do it. That makes sense. We see the world not as it is, but as we are. Correct. The criticism in the fire movement doesn't really make sense because we have had this group of people who are saying, I want to live on less. And if I live on less and say and try to create some security for myself, then I can do

some things that I really want to do. And it's really about values, right? it's about values. And they're saying, this is my value and I don't want to grind it out. And then look up and I'm 70 or 80. And I haven't done some of the things that really matter to me. And now on the flip side, I think sometimes the fire ribbon has to be very careful to say everybody can do it. Because then that doesn't take into account those people who really can't. You know, they have two or three jobs. Their housing is 60 and 70 percent of their take home pay. Well, you can't save half your income. that way. So just appreciate that there's a great amount of people in this country who are

living paycheck to paycheck, but not because they're buying big screen TVs or living in big houses or drive big cars. They just don't make enough. Yeah. And the wage is not enough. They don't, they can't make a living wage. We ought not to make them feel bad about that. We should just say, do what you can because you've got to save something. Yeah, absolutely. And that's a message that I try to bring to the fire community as well, that you look at the median U.S. household income and by definition, 50% of people are living below the median. Right. That's right.

And struggling, struggling mightily to even just put food on a table or worried if their mortgage or rent is going to be paid the next month. But I think we all have to realize we're really all in this together. My success is somebody else's success in a sense that my husband and I help extended family members, we help people in our community, and when one person can't make it, that's a cost to all of us, really. It really is. Higher taxes, more stress on the resources, and so we need to be helping each other. We'll come back to this episode after this word from our sponsors. Fifth Third Bank's commercial payments are fast and efficient, but they're not just fast and

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How has your philosophy of money evolved during the last 30 years? It hasn't, to be honest. I was raised by my grandmother, who called her Big Mama. everything I know about money I learned from her. Now, I had financial advisors. I had a master's in business from Johns Hopkins University. I'm a very learned woman. Talk to the head of the Federal Reserve and interview all kinds of people, John Bogle from Vanguard. So I know lots and lots of smart financial people. But the basics of money, I learned from my grandmother, who didn't make very much money. She was a nursing assistant at a hospital. Probably never made more than like $13,000 a year,

raising five grandchildren. Didn't take welfare. She took the health care because we were sickly bunched and health care costs a lot even back then. But she was an amazing saver. She handled her money like a pro the little bit that there was. She never was late on a single bill in her entire life. And I mean that literally, even with a husband who had a drinking problem, who often didn't bring his money home. She paid her house off before she retired, and she lived a good life. And I just looked at how she handled her money. And I say that it hasn't involved because the basic principles about how to have your money don't change with the decades. They don't have to evolve. It's always the same. It's like the sky is always going to be blue. Grass is always going to be green. And so I

say that it hasn't involved in a sense that the basics that will keep you wealthy. And I don't necessarily mean, you know, with two commas behind the one. But the basics of money, you know, save from every penny or every dollar that you get. Live below your means. Hate debt like it's the devil himself. Say for your future. Don't buy more than you can afford. Don't care what other people think about what you wear or dry. All of those principles are the same no matter what time in what century that you live. So I haven't evolved in that sense. I do have to evolve in terms of what kind of financial products they're out there, the games that are played against consumers, trying to help people protect themselves. Those things change and evolve. And you have to stay on top

those kinds of things. But the basics of personal finance is always the same. So the tactics change, but the principles stay the same. Absolutely. It's like that book, you know, everything I needed to know I learned in kindergarten, same thing with finances. I mean, with the kindergarten, it's like, be nice to folks, be kind to people. Raise your hand and be respectful when it's time for you to speak. It's the same kind of with your money. Don't spend every dollar that you make. Say for a rainy day, my grandmother, to say, you have to save for the ready day because it's always going to rain. And then just be generous. That's the other thing that we often leave out of personal finance is that to, I believe, to who much is given, much is required. So as we set out to save for ourselves and secure our future, we need to carve out

on a regular basis, just like it was our mortgage or our rent, a percentage of our income and savings to help other people. So giving is at the top. up our expenditure, even above our mortgage, because we have to put that first. Because if you don't, and it comes last, there's not a lot of left to give. There are some people who are listening to this, who are currently in their late 40s or their 50s, and they haven't really been paying attention to their money until now. They haven't really been saving for retirement until now. And now that they've started paying attention, everything they're hearing is that they should have started in their 20s. And they're kind of going, oops, too late for that. What should they do?

You know, I love this question because I hate it when I'm off to speak in engagements. I'm on panels. And then there'll be financial people's like, oh, you know, if you have to say by now, it's too late. You'll never have enough money. You're just going to die in some box. And I think, how does that serve anybody? How does that serve the person? who didn't know because you don't know what you don't know. Now, if you know and then you do something crazy, then, okay, I'm going to fuss at you. But if you didn't know, you didn't have someone teaching you, you didn't, hadn't listened to this podcast or read my column, you just don't know. And I don't think it serves people to make them feel bad about themselves. If you wake up

and you're listening and you're 40 or 50 or even 60 and you haven't saved enough, okay, that's where you are right now. Now, let's figure out what retirement or how your life is going to look. So you probably are not going to have the same kind of retirement and say those of us in the fire movement or those of us who saved since we were 20. I mean, I'm saved since I got my first job at 14. So I can, you know, leave my job and travel around the world. And I might even be able to buy a second home in Florida or somewhere on the beach or whatever I wanted to. You know, I've been saving for multiple decades. So that means you might not be able to have to do that. You may have to live with your kids or have someone come live with you or open up your room.

to a roommate or maybe you do have to work a little longer or working to your 70s if you're healthy enough. And that's okay, right? That's okay. That's where you are. You can't beat yourself up. You can't change. You can't go back in time. We don't have a time machine yet. And so I'd like to get people like that hope. Don't beat yourself up. That's not going to do anybody any good. But what you can do is say, today is the day I'm going to make a change. Every single day. is a chance for you to get it right and a chance for you to make a difference. And so now, if you're 40 or 50 or 16 and say, oh, my goodness. So now let's look at your budget. Let's see where we can cut. If you're in a too big a house that you can't afford, maybe we're going to sell and downsize.

Maybe you've got a sister or a brother who lives close by on another city who has extra space in their home because, you know, we all like to have all this extra space. Hey, Brahms, sis, no, I didn't do what I was supposed to do? What do you think about us sharing a home together, sharing so that, you know, I don't have to work till I'm 80. You're going to have some of those conversations. Just think outside the box if you haven't done all this. But it's never too late, I believe, to make a change and to realize that you may not be able to have what some other people have. And that's okay. I love that you gave the example of living together, like living with a roommate or living with a sibling, because there's this dominant cultural paradigm that that's something that

you only do in college, but past the age of 25 or maybe 30 at the oldest, then you're to quote unquote too old for that. I've never understood why so many people stress their finances out by choosing to buy into that idea when, in fact, in lots of countries around the world, it's very common. Housing is your single biggest expense. Exactly. You have countries where multiple generations of family together and think nothing of it. Only in America that we say to an 18 year old, okay now you're on your own. Get out there. Get an apartment. Pay all this rent. Do all this stuff that make yourself independent and an adult. That's just ludicrous. There are people that you have to be careful not to enable. If they're not doing

what they're supposed to do, then you know, you may have to ask them to leave and make it on their own so that they can learn that lesson. But if you've got a kid who went through college, They got tons of debt and it's going to take them 30 years to pay this off. There is nothing wrong with saying, honey, come back home, work, take almost all of your pay to get rid of these loans as quick as you can. Stay here as long as you're paying off the loans or as long as you're saving to buy your house, I'm okay with you not paying rent if the parent doesn't need the money. There's no failure about that.

I think it's ridiculous that we live in a country where we make everybody feel that that everybody has their own house or apartment. It's not sustainable on a lot of levels, economically or environmentally. We're so busy tearing down forests and clearing out land so everybody can have a house with five rooms, six rooms, five bathrooms, half the rooms you don't even use, you just fill it up with stuff. You have rooms that people can't even walk or sit in. It's ridiculous. My husband and I built, you know, a larger home, but we have always had somebody living with us. We just had someone rotate out and somebody else is living with us again because we knew that we wanted to share our space and our fortune with other people and our family and extended friend network.

We just had a relative come live with us. She was in a lot of debt. So we said, okay, you can live with us for a year, you know, pay no rent, take all your money, pay off your debt. And then that's like assess the situation after that. And that's exactly what happened. And now she's back on our own. One of my daughter's friends got into a situation and what she needs some help us. She's living with us. And so we always open in our home. I am a huge advocate for shared housing and multi-generational living. And the only way many families in this country are going to succeed is that they start accepting that. And we stop telling people that they're a failure. If they're living at home when they're in their 30s or even 40s, there are some people who have done some things wrong financially and end up coming back home.

But that's not what we're talking about. If you've got a very stable young adult who's doing all that they're supposed to do, and they don't want to pay all that rent to somebody else. They want to be able to save their money so that at some point they can buy their own home and start their family maybe or stay there with their family. That's okay too. To me, it's just ridiculous that we put the stigma on having a roommate or shared housing. When we know that housing is one of the biggest parts of anybody's budget, and if you can reduce that, that's more money that you can save for your retirement and your family.

future and not stretch yourself out. Absolutely. In terms of generations, it works in all directions, right? So it's not just young adults. If you're an older adult, if you're in your 60s and you're looking ahead at your retirement and you're realizing my retirement, I don't think I have enough money, it's okay to ask your kids for help or to move in with your kids. I absolutely think it is. I absolutely think it is. And think about it multi-generational households, then we wouldn't have kids having to go off the daycare because, you know, the grandparents are there to help out. But that also means, though, that we've got to fix these relationship issues that we have because in order to be under one roots, you got to have some good relationships. And lots of families are not in that situation.

Young adults can't wait to get out because they didn't have a good happy life. Or there's lots of acrimony and issues and favoritism and just bad parenting. So let's try to address those issues so that we can be in a situation where people can live together and peacefully. Yeah, I'm glad you said that too, because that's the other thing. Whenever people talk about living with your family, the thing that strikes me is that there are so many people who, for whom it's not an option. They came from maybe a family that was very emotionally abusive or they came from a family where they have serious cultural differences. So perhaps you come from a family, the family has a very concerned. culture, but you are gay or transgendered. And it's just not a match. Those are the people who just

can't move in with mom or they can't stay with mom and dad because it's just not going to work out. You know, you come from a family that believes very strongly in arranged marriage and you don't want an arranged marriage. That's just you can't live at home with your parents. It's not going to work out. There's too many cultural differences. And that's okay too. I mean, not every situation is going to work for everybody. And so that's okay, too. If you have that kind of situation, all right, now we've got to think of something different. Yeah, and I think that's where roommates can play a really big role in it, yeah?

Yeah, that's exactly right. And some of us have to do that. You know, some of us, some of our friends are our family. And that's okay, too. Other than that, what are some other out-of-the-box ways, unconventional ways that people can at any age improve their financial situation? Obviously, you start with employment. You know, are you adequately employed?

Do you need to elevate your credentials or education or vocation? We often talk about college, but there are a lot of vocations out there that people make really good money. I mean, anybody who has a home and has to call a repair person to fix anything understands this, that it takes weeks for you to get a repair person to come to your house. Because those vocations have been looked down on and not as many people go. into them. Look at your employability. Am I maximizing my ability to earn a certain amount of money? And where do I live? I mean, we all kind of want to, not all, but many people want to live in big city areas and things like that. But let's think out there are some towns and places that may not be big city where you can still earn a good living and the cost of living is lower. Maybe I shouldn't be in Manhattan, you know, if I really can't save enough to retire early or retire at all. question sort of the assumptions that you make that I have to be in some place or I have to be in this kind of job or I can't live in my, I can't share my space with a roommate. Just question all of those if it's keeping you and holding you back from saving and living below your means.

We'll come back to this episode in just a minute. But first, Michelle, one thing that strikes me when I hear you talk is I can hear the passion in your voice. And again, you've been writing about this since the 19. 90s, how have you remained so passionate about money for this long? You know, I get that question quite like, how do you keep thinking about columns or how do you keep not get stale? I don't know. Growing up the way that I did and under the circumstances, it just has stuck with me. My soul is different than I think a lot of people because I literally know what it's like not to have. I know what it's like to be literally hungry. Like we,

now when you open the refrigerator and there's food in there and you say, oh, there's stuff in here to eat. I mean, you open up the refrigerator and there is no food in there, just a box of baking soda. So I understand that. And I come from that to being helped by my grandmother,

where we didn't have a lot. We had enough to eat, no extra. So we didn't have like leftovers because we barely, you know, had enough for what we needed at each meal, to men young adult and then starting out with my husband, to having a good salary now and not having to worry about. Now I'm in the position where I open the refrigerator and I say there's nothing to eat. There's plenty of food in there.

And because of that, and because I had to help, I had a brother who was disabled, so I had to help him financially and emotionally and, you know, when my grandmother got ill and my grandfather. I mean, so I've had to do so much connected to personal finance through all of this time that I know what it's like at almost every single level, except for maybe Uber rich. Right, Uber rich. And so I know what it's like when your eyes are open and someone helps you and you get that, as Oprah would say that aha moment. I never want to lose that. I never want to forget where I came from. And it's that legacy that my grandmother left me, that compassion that she had.

I mean, who in their right mind takes in five grandchildren on a minimum wage job and then still handles her money in an amazing way? And I always feel like I would do her a disservice not to remain humble and compassionate and make it my life mission to help people understand this money thing and to have have financial freedom. Not a lot of stuff. I'm not about a lot of stuff. I don't like branding clothes and fancy cars and things like that, but just financial security. There is just something about that. That when your phone rings, your stomach doesn't cringe thinking it's a bill collector. Or it comes time to send your kid to college. You're thinking, how can I, can I do this? I got to take out all these loans.

Or you hate your job. You've been working in it forever. And you're like, I'm done. And you want to be able to have enough to retire and say, I'm ready for this next phase. And so all of that is sort of crunched in my little body. And I just want to be that beacon for people, that person with, you know, common sense. And I'm going to tell you just like I see it. You know, I'm a black and white kind of financial columns. I'm not great. I hate debt. And I would scream it. If debt was a person, I'd slap it. And so I unapologetically. talk about the need to stay out of debt and how car leasing is crazy and, you know, I'm very passionate about certain things because I know what it's like when you get to that other side and you have a certain amount of financial security. And I want other people to feel that. So I just remember where I came from and that just, I guess, resonates with the way I write and the way I speak. And I think it helps people say, I'm not somebody who came from money. I'm not

telling you something that I don't do myself. I'm not telling you something that you can't do. I mean, there are some people who do this and they don't understand where a lot of people are coming from. And I do. I understand where you're coming from if you didn't have it. I understand if you can't retire early. That's okay too. And if you can retire, great. So I think when we talk to people about personal finance, we just have to understand where they are and be compassionate and impathetic. And when you do, they will hear you and they will listen. And so that's kind of how what keeps me fresh, just always remember where I came from. You mentioned earlier that oftentimes if you don't come from much and then later in your life you have money, you might

experience the temptation to spend it because you remember the experience of not having things. How was it that you were able to overcome that? Again, I think it was my grandmother, because she was so, we didn't have a lot. But my grandmother was never ashamed of being low income. She never felt guilty that she couldn't get a certain stuff. She's like, get over it. That's the best I could do. Those shoes are okay.

They're not brand name, but they're okay for you. For me, financial security is not about stuff. It's about making sure that if I lost my job, that I could keep my lights on and food and refrigerated so I got another job. And that another job could be cleaning toilets. I'm okay with that too if I have to do that. And I think the key is remembering, I might get get a little biblical here, but, you know, in scripture, Apostle Paul says something like, I know what it's like to live when I have a lot, and I know what it's like to live when I have a

little. The key is to have a balance between those two worlds so that you never feel so poor that it hurts. You never get so rich that you don't understand what it was like to be poor. And that's what keeps me humble and living below my means even as I earn more money. Because I never like that feeling of open the refrigerator door and not have anything to eat or worrying about, you know, my grandfather not coming home with the money. For me, it's always remembering that it could all be taken away. Nothing's guaranteed. You know, I think I'm doing a great job at the post, but tomorrow they can say, you know what? We decided to let you go.

And if that happens, I don't have to worry about down sales in my life because I never lived up to the level of my salary anyway. So it's like, okay, if I don't have to have cable, it's cool. I can read a book. And so I guess it's just about being humble, knowing that not much is guaranteed in this world. And so you just make sure as best you can because we can't guarantee against everything. as much as you save unless you are like a Bill Gates or Elon Musk, that even your savings might not save you from everything. But I tell you what, the more you save when it rains,

your umbrella will be a lot more sturdier if you continue to live below your means and stay humbly financially. And so that's kind of how I do it. Well, that's beautiful. I'm glad that your grandmother has left such a legacy. and through you, that legacy is spreading. Yeah, she was fire before there was fire. She understood this principle.

I'm in awe of her still to this day. She's passed away, how she did it. And she did it with such regalness, and she never felt deprived. Her grandparents were slaves, and so she understood the absolute issue of having nothing and being considered inhuman. And so she was always okay where she was financially.

And she never needed to impress anybody, never cared what you thought about what she had. And I love that she gave that to me because I really don't care what you think. I don't have to wear anything, drive anything, have anything, even to the job. You know, I work for the Washington Post. Very prestigious place. I don't think anything of it. Not at all. I'm very honored to be able to do it.

but it's not who I am. If your grandmother was still alive today, what do you think that she would tell you? Oh, my gosh. Are you saving enough? My grandmother, she didn't really believe in a lot of phrase because she didn't want you to get a big head. So she's like, yeah, don't think too much of yourself, girl.

So she always tried to keep you humble. I'm sure she would be proud, and I think she would be grateful that she taught me so much. But she wouldn't let me know she wouldn't say anything. She was always about being very modest and not chomping in your own horn. So I think she would just be like, are you sure you saying? Do you need to buy that? Even though I'm fairly frugal.

But that's okay. What was your grandmother's name? Her actual name was Marie Kelly. But I only called a big mama. That's what we always call. She was a great woman. Crazy down the webbing. She was a cross between a drill sergeant and a guardian angel.

So you can imagine those two. Crazy, crazy. Anyway, thank you so much. This has been great. Thank you. People who are listening to this, if they want to find out more about you, find out more about your work, obviously they can read your column in the Washington Post twice a week. Is there anywhere else that you would encourage them to visit?

My website, Michelle Singletary.com. The best place to find my work and reach me is at the Washington Post, Washington Post.com. Thank you, Michelle. You're welcome. Thank you, Michelle. What an amazing interview. What are some of the key takeaways that we got from this? Here are six.

Number one, decide what is more important, living as though you're rich or actually becoming rich. And it is easy from the comfort of sitting. in a podcast booth to say something like that. But the reality is that there is a lot of emotional and psychological weight behind our spending decisions. And that needs to be faced and it needs to be dealt with and processed in a healthy manner. And so the solution of live on less than what you earn so that you can invest the difference, that solution is simple, but it's not easy. If you grew up poor and you now have a little money and you hate it being poor, you no longer want a discount shop. You don't care if it's not on sale.

You want all the fancy shoes and purses and the big house and the car because you remember what it's like not to have. But you can't live like that and save and retire early. And so there is a trade-off between living as though you have money, versus actually having money. The more you do one, the less you have the other, or the less that you can grow the other. That is mathematical fact. And it is also the case that living that out on a day-to-day basis

requires some deep inner self-work, because money is an inherently emotional topic. So that's key takeaway number one. Key takeaway number two. The younger generation of millennials, we didn't invent the fire movement. Of course, we all know this. Fire has been around for many, many, many generations in the past. It may not have been called that, but in one form or another, the philosophy has been around for a very long time.

But the modern resurgence of fire, the fact that it's grabbing headlines, maybe, in part, a social and cultural reflection of the fact that we no longer stay with one employer as people did back in the 1950s. Companies are not loyal to their employees, nor should you be to them. Now, that doesn't mean that you don't put in a good day's work, that you don't work as hard as you can. When you're at work, I'm a hard worker. I believe that I'm going to do what I need to do to help my employer, but I don't owe them my life. And I think that's what a lot of people are saying. So when they say they want to retire early, it's not a rejection of work. It's actually an acceptance of life. Many of us have discretionary income and activities with which to fill our leisure time.

And we live in an era where it's socially acceptable to move from job to job or industry to industry. And all of those factors combined give us the opportunity to ask what are our values and what the life that I want to live, and give us the context in which it's socially appropriate to step away from an employer, to quit your job, and yet still thrive in the fabric of society. So that is the second key takeaway. Fire is very much of our time, and as Michelle so beautifully described it, it is not a rejection of work, but rather an acceptance of life. Key takeaway number three. The essence of the fire movement is a rejection of consumerism.

And when you look at the essence of the movement, what I'm really saying is, do we need all of this stuff? Do we need this huge house, this big core, these privacy? Do we really need all this? Because if we don't scale back, we will be working until we're 70 or 80. Now, if I may, what I love about the fire movement and one idea that I would like to spread is that fire is not, and this may be semantic, but fire, in my view of it, is not about frugality. It is about anti-consumerism and about the joy of production and being productive. So frugality in the way that at least I understand it or that I define it and I understand we can have a different debate about what exactly the word frugality means. But my working definition of frugality is that it is the attempt to consume for less.

And that inherently is a fixation on spending. Sure, you're trying to spend for less money, but you're still thinking about spending. You're thinking about thrift stores and yard sales and coupons. And anti-consumerism, by contrast or minimalism, is the question, do we need all this stuff in the first place? Or, you know, do we need the stuff that we find at thrift stores and yard sales and through coupons? People drag stuff out of their garage and sell it just so that we can buy it and put it in our own garages? Like, do we need that? Or can we skip all of that?

by just buying less stuff in the first place. Because remember, the best Black Friday Cyber Monday deal is to save 100% by not buying anything. And that is the ultimate scaling back, right? When you live in 1,500 square feet instead of 3,000, that's not an extreme measure, but it can shave years, perhaps even a decade off of your working life. But that said, there are many people for whom a 1,500 square foot house is an expensive stretch. And that leads us to key takeaway number four. Just appreciate that there's a great amount of people in this country who are living paycheck to paycheck,

but not because they're buying big screen TVs or living in big houses or drive big cars. They just don't make enough. Their wage is not enough. They can't make a living wage. We ought not to make them feel bad. bad about that. We should just say, do what you can. Many people in the fire movement can sometimes be flippant about what it's actually like to earn a low income. And so broad sweeping statements like, oh, it's not what you earn,

it's what you save. It is what you earn. That's why it's called low income. What you earn matters. And to say something like that denies the reality that if you only make $11 an hour, an unexpected $50 expense is extremely stressful. So the only people who say things like, well, it's not really what you earn, it's what you spend. The people who say that are people with plenty of discretionary income. So let's never forget that fact because when we as a collective start forgetting that, that's when we begin appearing out of touch or worse, insensitive. Let us never become people who make 75,000.

thousand a year or more and finger wag about frugality. Let's not be that. And I hope that we're not. And I also hope that this reminder keeps us in the space of not being that. And when we do live in abundance, as most of us do, giving becomes even more important. And that leads to key takeaway Number 5, if something is important, such as saving or giving, you put it at the top of your bills, at the top of your expenditures, not at the bottom. So giving is at the top of our expenditure, even above our mortgage, because we have to put that first, because if you don't, and it comes last, there's not a lot of left to give. If you want to find the money for something, make it the first thing that you put your money

towards. This reminds me of something that Rachel Cruz once said. She described when she's talking to people who say, oh, I just can't save anything. She tells them, make a list of your income and your expenses. They'll write out their income, and then underneath it, they'll write down all of their expenses. And then underneath that, they'll say, look, there's nothing left here at the bottom for me to save. Rachel's reply is, oh, well, your budget is upside down. And I love that framework. That framework of your budget is upside down because you put savings at the bottom rather than at the top. And if you flip that around so that you earn and then you save and then whatever is left over is the amount that you can spend, that is a reframing of the way that you handle money that can be

very impactful. And what Michelle has talked about in her interview is that she's done that same thing with giving. So when she looks at the money that she has allocated for spending, she puts giving at the top, and then whatever is left over is what's left over to spend. Both of those examples are actionable ways of expressing and living out that philosophy that you can afford anything, but not everything, and that everything is a trade-off. And so if something is important to you, you put it first. Finally, I'd like to close out with what. One more key takeaway, and it's something that I'm really glad that she talked about because I haven't heard it discussed enough. In order for financial health to be strong, our overall health needs to be strong, and that includes our emotional health and the health of our relationships.

But that also means, though, that we've got to fix these relationship issues that we have, because in order to be under one root, you've got to have some good relationships. And lots of families are not in that situation. Young adults can't wait to get out because they didn't have a good happy life. Or there's lots of acrimony and issues and favoritism and just bad parenting. So let's try to address those issues so that we can be in a situation where people can live together and peacefully. For many years, I believed that emotional growth, emotional health, healing, psychological health, I believe that those were optional. They were nice to have.

They were something that you could get around to focusing on once you first fixed the money side of the puzzle. But in hindsight, that makes about as much sense as saying, like, oh, I'll work out once I have my finances under control, which admittedly when I was in my 20s was also something I probably would have said. In order for everything to work together in integrity, all of these pieces, your physical health, your emotional health, relational health, your spiritual health, in whatever that means to you, and your financial health, all of these need to fit together. And if one of them is out of alignment, it's going to throw everything else out of whack, maybe not right away, but eventually. And so do not ignore or shortchange other areas of your life in an overzealous or single-minded pursuit of a higher net worth or a financial independence or early retirement. You can fix the financial side of your life, but until your emotions and your relationships and your mindset, until all of that is good, then the whole will still be broken. Michelle talked about the importance of, if possible, families healing so that they can live together peacefully. Now, that's not possible in every family, but if it is, that's as important, more important than your net worth.

And also, you coming together to live peacefully within yourself. Ultimately, isn't that also the point of all of this? So those are six key takeaways that came from this conversation with Michelle. That's our show for today. Thank you so much for tuning in. This interview with Michelle Singletary is part of our September sabbatical series, in which during the month of September 2020, we share some amazing interviews from our archives.

Coming up next week is an interview with Gretchen Rubin. She talks about some of the loopholes that keep us from building the habits that we want to build. How do we justify or rationalize the excuses that we make? How do we get in our own way? That's the conversation that we'll be having with Gretchen Rubin coming up on next week's episode. And in the month of October, you'll be hearing from professional poker player Annie Duke, who talks about how to improve the skill set of wise decision making. So make sure that you hit subscribe or follow in whatever app you're using to listen to this show

so that you don't miss any of our awesome upcoming episodes. If you want to chat about today's episode with other people in the Afford Anything community, head to affordanything.com slash community, where you can connect with people based on a wide range of shared interests. So if you want to find specifically people who are paying off debt, or people who have just early retired and are in the first few years of their early retirement, or if you want to find people living in the Pacific Northwest, or in the southeastern United States, or in Europe, or if you want to find people who are in their 20s or their 40s or their 60s, you can assemble in this community among these different shared interests.

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It's at afford anything.com slash community. If you want to subscribe to the show notes so that you can get synopsies of these episodes sent directly to your inbox, you can grab that at Affordanithing.com slash show notes. Thank you again for tuning in. My name is Paula Pant. This is the Afford Anything podcast, and I will catch you in the next episode. You've been writing about money for three decades now. Yes. That's something to be proud of.

I mean, that's fantastic. I go around telling people I'm only 29, so yeah. All right. So you've been writing about money since you were in the womb. That's right. That's right. That's a wee, tidy person. Since before you learned how to read and write, you've been writing about money.

That's exactly right. And you know, it's so funny, I tease about that. Not because I don't mind aging, because I actually like aging. There is such a great feeling when you reach a point where you're very self-assured and you don't really care what anybody thinks and you have some basic knowledge about life and things. But then you also put into this box, like, oh, you know, remember back in the day where we thought somebody was 50 was like really old.

And now, you know, 50 looked like, hey, 20. And so I feel like I'm still in my late 20s and early 30s. I just love to laugh and joke and play practical jokes on my kids and my husband. And so it's really my spirit that I feel has that youthness about it. That it's like, yeah, life is still really cool and just hopeful. That's beautiful. And I think that you have this opportunity to redefine our notions of what it is to be. in a given decade of life.

That's right. Absolutely. You know, I follow Elon Musk's mom on Instagram. She's gorgeous. She's 73 years old. She's a model. She is like, wow. She's working it.

Yeah. And, you know, that's the key to making your money last, too, is being healthy. Yeah. That will definitely make your money stretch. Yeah. Of course, she doesn't have to actually worry about that. Is Elon? But the rest of us do.