NerdWallet's Smart Money Podcast - Financial Fitness for Big Moves: Achieving Your Goals Without Sacrificing Security (Video Episode)

Episode Date: September 9, 2024

A certified financial planner offers a listener actionable advice to help him save for a big move while maintaining financial stability. NerdWallet Advisors is no longer accepting new clients, and will be closing its financial planning business as of December 20th, 2024. How much should you save before you move to a new city? How can you reach your savings goals while also spending on your lifestyle? Recording in-person from a studio in Chicago, host Sean Pyles sits down with Magda Doemeny, a certified financial planner with NerdWallet Advisors, to host an actual financial planning session with a listener. Jim, a 36-year-old nonprofit worker, joins them to share his aspirations of moving to a higher cost-of-living area without a job lined up. Magda advises him on how much money in living expenses he should consider saving before making the move, the practicality of high-yield savings accounts, and the benefits and limitations of using a Roth IRA for a down payment, among other practical strategies for reaching his goals while maintaining financial stability. NerdWallet Advisory LLC, dba NerdWallet Advisors, is an SEC-registered investment advisor and wholly owned subsidiary of NerdWallet Inc. The advice provided in this episode of Smart Money was for illustrative purposes only and not intended as financial or investment advice specific to your personal facts or circumstances. In their conversation, you’ll hear about: smart financial planning, major life transitions, certified financial planners, financial stability, dream relocation, higher cost of living, Roth IRA for a down payment, high-yield savings accounts, budgeting tips, saving for relocation, emergency savings, long-term financial health, actionable financial strategies, transportation costs, retirement savings adjustments, financial goals, balancing life changes, moving to San Diego, cost of living, clear financial goals, financial risks, increasing income, trimming expenses, side gigs, prioritizing savings goals, healthcare coverage costs, affordable financial planning, financial plan, setting financial goals, car purchase planning, and moving expenses. To send the Nerds your money questions, call or text the Nerd hotline at 901-730-6373 or email [e-mail]. Like what you hear? Please leave us a review and tell a friend.

Welcome to NerdWallet's Smart Money Podcast, where you send us your money questions and we answer them with the help of our genius nerds. I'm Sean Piles. This episode, we're continuing our series where we're doing something pretty unusual for smart money. At the request of NerdWallet's brilliant legal team, we say often and explicitly that we are not here to give you individual personal finance advice. What we talk about is food for thought for educational and entertainment purposes only. But this episode, our listener is getting specific personal finance advice for their money question. A few weeks ago, you may remember that we put out a call inviting you, dear listener, to contact us

if you wanted some free financial planning and allow us to record that planning session. Lots of you wrote in, and today we're going to hear from one of you. We're coming to you live from a studio in Chicago, and we'll be talking in person with a listener. But before we get into that, I'd like to bring back Magda Domini. She's a certified financial planner with NerdWallet Advisors. One thing I want to be clear about is that Magda and NerdWallet Advisors are a distinct

platform from NerdWallet. Magda will give our listeners some specific individual personal finance advice, and that advice will be given on behalf of NerdWallet Advisors, not NerdWallet. Also, in exchange for coming on and talking with us, our listeners are receiving a free one-year membership to the NerdWallet Advisors platform. Magda, welcome back to Smart Money. Thanks, Sean. So we've talked with you before, but can you give us a refresher on who you are and what the NerdWallet Advisors platform. Magda, welcome back to Smart Money. Thanks, Sean. So we've talked with you before, but can you give us a refresher on who you are and what the NerdWallet Advisors platform is? Yeah, so I'm an advisor with NerdWallet Advisors, and what we offer is affordable

financial planning memberships with access to a certified financial planner like me at a low monthly cost. What we do is review your finances as a whole and ultimately create a financial plan that has action items in there that are pretty bite-sized for you to break down. And then we'll check in with you periodically throughout the year. And ultimately, if you ever have a question, you can always schedule a call and or send us a note, and you really just have unlimited access to us. Great. So a lot of people have not gone through the financial planning process before. What's something that people might not expect about going through this? I think the thing that folks aren't usually ready for is the commitment aspect of this.

You know, kind of like if you decide to update your health and fitness regimen, you know, going to the gym or going to the doctor, if that's all that you're committing to, that's not really going to change your life. And so what we really want is for folks to understand that, you know, we can break this into bite-sized pieces so that it is one day and one month at a time. So it's a lot less daunting, but it does take commitment for you to make sure you want to go through this process. It's about those small, regular actions beyond one big meeting with you. Exactly. All right. Well, let's get to some financial advising. In a moment,

our financial planning session with a listener here in Chicago. Stay with us. Exactly. to Smart Money. Thanks for having me. So tell us a little bit about yourself. What do you do for work? What are your hobbies? All that sort of stuff. I work for a nonprofit. I manage grants that go out to education programs. I'm a former journalist and middle school math teacher, actually. And for fun, I play a sport. I play a sport called hurling, not curling on the ice with the brooms. Hurling is like Irish lacrosse. And I love, love, love to kayak for the very few number of weeks that it's fun and comfortable to do that. Yeah, I bet. Okay. So how would you describe your current mode of managing your finances? Are you active? Are you passive somewhere in between? I would say extremely active. Okay. Yeah. What does that mean for you? I track all of my expenses. I rebalance my accounts as best as I can about every quarter. I'm very, very, very cognizant of where my money is going and if it's doing the most that I can make it.

Great. And that's why you're a smart money listener. That's right. So how would you very broadly describe your finances right now? I would say stable, but maybe precarious. So I make enough to do what I'm doing now, but I don't make enough to be working towards some other really big goals. So what I'm really interested in learning is what kind of financial risks might be worth it for me to take so that I can pursue some big goals that I have.

Okay. Well, tell us about your current financial goals. From what I understand, you're hoping to move from Milwaukee to San Diego potentially. And you're considering even maybe dipping into your retirement accounts to fund that move. Talk with us about that. That's right. I am a Midwestern boy born and bred. I was born in Chicago. I absolutely love the Midwest. And I absolutely love Milwaukee.

Everyone should visit. It's a wonderful place to live. It's affordable. It's got this gorgeous lake. It's got friendly people. And I am so sick of winter. I never want to be cold again for the rest of my life if I can avoid it. And while I'm pretty sure that if I did move to a warmer place, I'd eventually see that maybe the grass isn't greener, but I would feel a lot more peace of mind if I'd given it a shot. So I've been on the job hunt for a while to try and make that feasible. And San Diego was kind of my prime target. But it's been slow going and I've had a couple of close calls and

I've got some traction right now with a few things, but it's an expensive place. I don't have a lot of connections and I've put a lot of time in and I'm getting older and I'd like to start a family and buy a house one day and stuff like that. So I'm trying to weigh how important is it to me based on my kind of financial security, if it's a risk that's wise to take. Right. Well, making such a jump, moving to a new place and maybe even using retirement funds to make that move is pretty risky. So how are you thinking about the trade-offs of the risks and potential rewards for your life? Absolutely. So I have a Roth IRA that I've been saving, and I'd originally used it as a way to save for a down payment. I have a really generous retirement plan through my work. When I put 5% in, another 9% comes back. So about 14% of my pay

is going into my retirement fund through my employer. So extra stuff has been going into this Roth IRA that I've had for a couple of years. And it's because I've done some research and I know that you can use a Roth IRA without paying penalties and without paying taxes. And even on the earnings of that, I know that there's a limit that you can use even toward a down payment on a first home. So I've been saving for that, but because I really, really, really want to make this move and I haven't gotten a job to do that yet,

I would feel more secure and not like I'm going to deplete all my emergency funds and all that if I knew that it wasn't a terrible idea for me to tap into that Roth. And I might even be willing to go without a job and work, you know, service industry things just to kind of get out there and maybe that would advance the job hunt faster. But I don't want to do that if I think that that's going to put me in an unwise situation. I would say that I'm very, very cautious about my finances because I took on a lot of student loan debt in my undergraduate degree. So I never want to be in that position again. And being kind of stable financially is

really, really important to me. Right. Okay. And so you're hoping to get maybe a second opinion to bounce some ideas off of and see if this isn't so crazy an idea. I would love someone to give me permission to do something a little scary. Okay. Well, have you ever used a financial advisor before? No. Okay. Well, Jim, I know you have been sitting here across from Magda for a little while, but

let me officially introduce you to each other. Jim, Magda, Magda, Jim. Hello. So Magda, I'm curious if you have any initial thoughts about Jim's financial situation based on what we just talked about. Yeah, you know, I think this is not uncommon, right? There are folks who want somebody to talk to them

about where they are financially today and what kinds of decisions they can make, whether it be moving across the country or halfway across the country, buying a home, how much can they actually afford when it's so expensive? Can they actually afford a little bit more than they think? So when I look at your situation, I think you're doing all the right things by asking all of these questions. And what it really boils down to is what do we do, right?

Do we actually make that move with your current financial situation or not? I think I am a firm believer that your retirement is intended for retirement. And we want to do everything in our power not to touch that, mostly because we can't undo it. Once we remove the funds from a retirement account, you can't really put them back. And there's so many tax benefits specifically to those types of accounts. So I want to talk a little bit more about the details of kind of what your income is, talk about those expenses, talk about other ways we could increase income, if at all. Because when we do something big like this, I want to plan for it. And that means not taking the resources necessarily that we have and seeing what we can do with it, but instead saying, I'm going to do this in X amount of time. How do I get myself there? What do I do now? Let's look into some

more specifics. I know when you do financial planning, you need some specific numbers. You're looking for balances of savings accounts. Let's really dive into that nitty gritty. So when it comes to something like a savings fund for a move, what would you maybe want to see from Jim here? Or what other options might there be for Jim to make this move if there isn't a lot of liquid cash available? I think if you're going to be making a move without a job, I want at least a year's worth of expenses. I really want a year's worth of expenses where you're going, not where you are today, right? Because what we want to know is if it takes you a year

to find a job that can pay you somewhat near your cost of living, I don't want you to have to incur high interest debt, which is what could happen, right? Ultimately, if you need to pay for something, it goes on a credit card. And if there's not cash to support it, that stays there. You get a rolling balance. And that could just be for your day-to-day expenses, potentially. So we need, ideally, at least a year if you're quitting your job and moving. And so, Jim, what is your emergency savings like right now or your move savings fund? Do you have anything like that put aside? I do.

So my emergency fund right now, I've been aiming to have about six months, and I don't have that yet. So I'd say right now I just wanted a big trip, but I've gotten reimbursed from my company. So I would say I've got something like $6,000 in emergency savings. And my low cost of living in Milwaukee, I'd say that would just barely cover three months. Okay. And are you putting aside a certain amount monthly to build that up?

Or how are you thinking about increasing your emergency savings? Yeah, I save about $850 a month. Although I've had a couple of big expenses lately, and I have a car that I love, but she is at the end of her rope. Uh, she's put in a good hard life and she deserves a rest. So knowing that, uh, I have this car that serves me fine now, but would absolutely not make a cross country move. Right. Uh, I've been delaying doing anything about the car in hopes that I might be able to move somewhere where that's not a necessity and that would save me a lot of money.

But I don't know those circumstances until I've made that change. Okay. So talk with us a little bit about the car. Are you willing to take on some debt? I know you mentioned that you're not really keen on debt at this point after all of your student loans. It seems like it might be an inevitability unless you really prioritize living somewhere that's more central, which could mean higher rent payment, especially in a more expensive

place like San Diego. Sure. I mean, of course, if I bought a car, I would absolutely need a car loan. But my bigger, more important priority is the move. So if I could move somewhere where I didn't need a car, I would happily forego a car so that I could pursue that. Okay. Well, Magda happens to live in San Diego. Can you speak a little bit about how walkable

certain parts might be? What are your thoughts around the necessity of a car in that city? Yeah. I've been there for just over a year now. And I live more in the suburbs since I have two kids. You know, I think it's possible, but generally California is not very public transportation friendly, I'd say, born and raised in California. So part of what's fun about California is all the places you can go, right? Beach, mountains, and those things will need a car. And so outside of you moving there to restrict your life to your area, you can expect to need a car to get places, which is a hundred dollar lift here or something like that. I mean,

it cost me $50 to get to the airport. So you'll probably need a car. So I'd like to hear your thoughts around Jim's savings in terms of emergency savings and savings for a move like this. Do you have any tips for how he could potentially increase the cash that he has to make a move like this possible on the timeline that you have? Do you have a set timeline, by the way? Do you want to move within a year? Yesterday. Yeah. So as soon as possible, what do you think are some good ways to accelerate savings? Yeah. So, you know, I have a little bit of context on your situation, which includes how much you have in retirement savings, which for your age is actually pretty good relative to how much your income is.

And this is more something that we use to gauge just general progression around how much you're saving for retirement. But it is based on your income and your living expenses, right? Because it means you've saved enough to cover your current lifestyle. But with a move to San Diego, the assumption would be you'd have to increase your income and increase your savings if that was your permanent home forever. If you end up moving back to Milwaukee, great, then you're saving higher. So because of that, I think something that I could suggest is, one, we want to take a look at your

expenses in general. It sounds like you track them pretty closely, which is great. But we can always, if we set a goal, which is I need to save X dollars, which for you would definitely be six months. But if you didn't have an income, I'd want it to be a year. And we can work backwards from that number. One thing I could suggest is that we actually decrease some of your retirement contributions, but I want to learn a little bit more about your match. So in order to get that 9% match, is there a minimum contribution you have to put in to get the 9% match? So we are a unionized office. So there's actually two employer contributions. So when I put in 5%, that gets matched to 3.5%. But then there's a 5.5% that is not a match. It's just put in.

But my 5% that I put in now is necessary to get the full nine. Got it. And this is 5% on what salary? Well, I just got a raise. So about 74. Okay. Congrats on the raise, by the way. Okay. And so you mentioned that Jim is in a pretty solid place in terms of his age for retirement savings. What was that balance, and how do you think about these benchmarks? Because there are certain numbers people see around, okay, one times your salary when you're

30, that sort of thing. So can you provide some context and details around Jim's situation for that? Yeah. So correct me if I'm wrong, Jim, but I have that in terms of retirement savings about $125,000, $125,000 or so, which is spread between a Roth IRA and a 403B at your employer. So that's about $97,001 and $26,000 in the other it's like 120 in the employer and then another 27 or so in my Roth okay so just for context we'll put you ahead of the vast majority of people in this country so even though these benchmarks are very aggressive one times your salary at 30 is impossible for many many people you're doing fantastic in that regard so you should be proud of that exactly older me will thank me but younger me really wants to be warm yeah Right. Yeah. Right. And that's true. So that I tend to use, there's a number of different ways you can just figure out if you're on or off track. I tend to not use

the very detailed method until you're really close to retirement, because then we're actually making a decision to cut off your salary, which, you know, the best ways for you to increase your saving is really only two ways. It's increase your income or decrease your spending. And so for you, I think that your retirement savings is great, which is why potentially we could trim back a little bit, but I really hate giving away free money. So I don't know that I'd want to do that. So I would want to prioritize two things. The first one would be, is there any other way we can increase your income? Whether it's gig work or contracting at what you do, if there's a way for you. I know, I think you had mentioned at some point that you have a journalism background. Is there a way you can start picking up some writing?

Sure. Something like that. Fun fact about me, I'm a giant nerd and I actually am a seasonal tax preparer. Oh, fun. So I've done that the last couple of years. People look at me like, what is wrong with you that you do this for fun? But I love it. But part of the reason why I haven't spent more time on side gig work, even though I have plenty of time for it, is because I've been using that time for the job hunt.

So I've been trying to spend my time making connections and networking and finding roles that I might want to do that would increase my income in my full-time job. So it's tricky to be able to find the time to do that when you're working, you know, at night as well. And what's the target salary range you're looking – where are you finding it? I would love something in, like, maybe the 110s, but I think I would accept a role that would be anything from like 95 and up. Okay. Okay. And what sort of specific jobs are you looking for? That's a great question. So my background is in nonprofits. That's where I have like the most experience and I think it's most likely where I'd go. One reason why I've stayed in

nonprofits so long is not only do I love it and it is very meaningful work and I work with good people and I like the causes that I work for, but I was on the public service loan forgiveness plan. So about half of my student debt was forgiven in April because I had worked for a nonprofit for 10 years. So now that that's happened, I'm no longer like the financial incentive isn't there for me to stay in nonprofits. So I'm very open to going into something else. You know, for a while, I really liked the analytical parts of my job. And I take, you know, classes in SQL and R and Python for fun. But because I'm sort of in a middle career, it's tricky to find a role where I'm not taking a low step, like a step downward. And, you know, I've got a lot of ad hoc, like, do it yourself learning that is a little trickier to sell, especially in tech right now, which seems like it's had a lot of layoffs.

So I have a very, very broad net, which has its pros and cons. It means I'd be willing to do a lot of things, but then it's really hard to know how to network or find something. So I'd say right now I've, you ultimately want to look at what your goal is here, which if it is to increase your income, you know, we as financial planners will tell people all the time you can stop working to go and get a degree if that's going to increase your income over time. And so even you mentioned taking a step down from maybe career level where you are, but ultimately if you're stepping into an industry that will two to three X your salary, that might not be a bad decision, right? Especially if some of these positions, being in the engineering tech space, their entry level positions could be not too far below your current one. And sure, it might be below, but it's probably remote, which is great. And you will still be a W-2 employee, which we care a lot about. Not that you can't be a contractor, but that comes with benefits when it comes to being fully

remote. And so that could be something that you shouldn't shy away from if you can actually get into that industry and then start to really progress your career a lot higher versus in one that might be a little more stagnant. I have no problem with that and applying elsewhere. And I love learning, but I have such a hate, hate relationship with the higher ed industrial complex. And the thought of taking on more student loan debt makes me want to jump out a window. It's not to say that I would never do it, but it would be very hard to kind of like maintain the feeling that this is- Really going to help you. Right. Really going to help me that it's not going to cause a lot of the same kind of anxiety

that it's caused me for the past 18 years. And could you get into the industry without additional education? I'd like to think so. Yeah. But that's where you're struggling. People keep saying that I can, but they haven't given me an offer yet. Well, I want to turn to talking about a different type of debt, home debt, mortgage debt. You're hoping to become a homeowner at some point. How have you begun to plan for that? Limited.

So I used to be married. I got divorced last year, and I had been using the Roth IRA combined with my partner. We were saving together in different vehicles. But the Roth was a way where I could save this money. I'd worked in a lot of other kind of sketchy nonprofits before that I didn't really trust how they were managing their finances. So I did my retirement savings myself through my Roth. So after doing some research, I learned that with a Roth IRA, as long as it's at least five years old, you can use all the contributions toward whatever you want without a penalty or taxes and even 10,000 of the earnings for first-time home purchase.

So the way that we were saving for home together was she was using her savings vehicle and I was using the Roth IRA as my savings vehicle. So that's kind of like been there. Like I'm not contributing to that Roth right now because I've got other priorities on my budget. But it's kind of been there as, well, when it's time for a down payment, I, whether, whether or not living somewhere with a really, really wonderful, miraculous climate like San Diego would be, you know, worth it. So I guess I, I, my, my savings is in the Roth IRA. And that's part of why I'm interested in talking today is like, well, I don't think buying a home is in the very near future. And I don't think it will ever feel like something that I'm really, I really feel good about until I made this other change, if that makes sense. for something that I would view as an investment. Not to say that you moving to San Diego and bettering your life in the way that it would better your life isn't an investment, but

the problem with doing it not into an asset like a house is that if you decide that this isn't for you and you don't like it and you move back, it is money that was depleted that didn't have the potential to turn into something more. And so for something like living expenses, that is something that I'd prefer we save for outside in some capacity, right, versus depleting a retirement account to use for effectively emergency fund really is what we would be using it for. And I do think that we could ultimately find a way to do that. We just probably extend your timeline a bit. But, you know, you had mentioned that you're saving typically around $880 or so a month, you know, in a year's time. And especially if there's any way we can even trim back expenses even more, that can be a

good chunk of money that we can set aside to say even more, that can be a good chunk of money that we can set aside to say like, this is you're getting to San Diego. I know a year might be too long of a timeline. So we can figure out how to adjust that if we can figure out how to make more money, right? And then we can really hoard a lot of cash that we can use for a move. Music to my ears is making more money. So I want to turn to specific advice on an even monthly basis, potentially for Jim in a moment. But I also have a question around accounts

because we're NerdWallet. I'm all about getting people the best products for their goals. What sort of savings account are you using? Do you have a high yield savings account? Talk with me about that. I chose my savings account based on NerdWallet's recommendations. And it is high yield? It is high yield. It's a SoFiyield savings account. Talk with me about that. I chose my savings account based on NerdWallet's recommendations.

And it is high-yield? It is high-yield. It's a SoFi bank account, yeah. Okay. So I think right now my savings account is at 4.6%. Okay, great. So what do you think about trimming expenses to be able to save more? Do you have anything in mind that you think, okay, that would be an easy expense to trim right off the bat?

Honestly, no. So, sure, I go out often. I am a pretty extroverted person and it's been very good for just my mood to be able to see a lot of my friends. I don't always have to spend money when I go out, but it's pretty tricky to go out into a bar or to a restaurant with friends and not spend some money.

So I can imagine if I was really disciplined, I could shave a couple hundred dollars a month off of that. But like I said about my car, I feel like anything that I would save by doing that would just get gobbled up when this car ultimately crosses the rainbow bridge. And it is something that we want to plan for, right? When we look at cash, we don't want anyone to have too much cash. I don't know if that's crazy to say out loud, but cash is not great. Cash is for specific purposes,

which is your emergency fund and any short-term goals that you have, right? Your car being one of them. So we would want to pre-fund whatever we think a down payment would be. So, you know, you'd want to do some research on what car you would want. And then we'd figure out roughly how much we'd want to put down for something like that. And that we'd want to set aside in cash. So if you're saying that you don't think that you could trim expenses too much, which is fair. I mean, I, you know, I don't want, I don't want to say, you know, go live with 10 roommates and, you know, find a way to never go out and enjoy life. That's not what your finances are all about, right? It's about meeting you where you are within the means of getting to your goals.

I do think the next priority would have to be focusing on increasing income, which it sounds like you're doing. But then my goal for you would be that we wouldn't move to San Diego until we at least knew where your income could get. Because if we find out that your income is $110 or $120, that's very different than if we find out your income would stay at $75, which we know for certain would not cut it. Would not be possible. Yeah, because, I mean, right now your housing expense is $1,000 a month, correct? Which is incredible. It's incredible. And no roommates, I assume. That's right.

Yeah, right. So I think in San Diego I would guess that you could do $1,000 with, like, maybe two or three roommates or something. I don't know if I'm being extreme. And so right now, based on your ability to maintain your contributions to retirement, which I'd love to do, like I said, you're a little ahead of the game. So if you change jobs and they didn't have this incredible match, I think I'd be okay with you trimming down your retirement contributions and we could reallocate those funds to maybe a cash account or just a standard investment account so that you can liquidate that anytime.

There could be penalties associated with if you've made money on them, but no penalty. That would just be taxes. So we could reallocate funds that we could say, you know, this is towards building towards a future home or something like that. So I would be okay with that. But I think we really need to figure out what your next job is going to be. You and me both. Yeah. Well, that brings me to the next part of this conversation, the actual specific recommendations, Magda, that you would have for Jim. So when you're thinking about a financial planning session like we're having now and this ongoing relationship that you will have with Jim going forward, what would you say is maybe the first best thing that Jim

should do to get to that goal of moving to San Diego, hopefully within a year, maybe two years? I think the first thing would be that we get a better idea of what the cost is actually going to be in San Diego. So that means really doing some research and finding real places on rent. I mean, we could talk about the other parts of the cost of living, obviously, but there's ways to do research and just find out, you know, how much is it going to cost to buy your groceries down there? And then accommodating for lifestyle change of just, you know, going out and about potentially a lot more in a new city. So I'd want to get a better handle on that. So then we could figure out how much do you need to make

to support that lifestyle. I also want to make sure we figure out how much we need for a down payment on a car. If we need one, which I think at San Diego we would, I wouldn't want to anchor on not needing a car because if you do, we got to find that money somewhere once we've already, once we've already done that. So I imagine it'd be cheaper to buy a car in Wisconsin than San Diego and driving it all the way through. I don't know

if there's, um, income tax you guys have, or do you guys have state sales tax there? Yeah. Okay. So I'm sure it's probably cheaper than California. Um, So I think those would be the first few things. And then we would want to figure out how to create an actual budget for you once you moved, so that we could decide how much can you be spending while you're there on non-housing, so that we don't go too far over budget. And then we would figure out if we need to, how much we can contribute to your retirement once you started your job. You know, my biggest thing that I actually haven't mentioned is moving somewhere without a job, one of the most important things that you're losing is your healthcare. And I don't know about other states, but being in California, it's not cheap.

And, you know, this can be several hundred dollars a month just so that you have healthcare coverage, which you have to have. And so that's another reason why it's just important for you to have some source of employment, whether it be that they provide it or you have an income to pay for the healthcare. So we'd want to make sure that got set up as well. Accomplishing financial goals. One thing that Magda and I talked about before this recording is about making changes it's like going to therapy like you don't just go for the conversation it's about having some proactive differences that you're going to make in your day-to-day life

are you prepared to make some significant changes to maybe how you manage your income and expenses maybe working a little bit more to be able to get to where you want to be in a year i very much am um the challenge is, you know, making the changes that are going to yield the biggest benefit. So like I mentioned, like I have no problem working two jobs. I've done that for a lot of my career. But lately, I've been using that second job time to find a different first job. And so it's hard to know what the payoff is. Like where is the most lucrative place to spend my time that also aligns with my goals and also takes into account just how much time I've already put in. I don't want to look too

much of like all this time that I've worked on it, but the fact that I've put so much time in and it's still this important to me kind of makes me want to kind of look more boldly at what kind of risks am I really willing to take? Well, Jim, do you have any other specific questions for us that you haven't asked yet? You know, anybody selling a car for really cheap? Unfortunately, no, not here. Not me. Great. Well, Magda, let's turn to what some listeners can get from this conversation. At a high level, what do you see in Jim's situation that might be applicable to our audience? You know, I think it's very common for people to not really understand exactly what their money can do for them. And frankly, even as a CFP, I find this to be the case sometimes too,

where I want to take risk, which is taboo. But sometimes I want to do that. And I know folks want to be able to stretch their dollars. And, you know, it is possible to be too conservative sometimes. And so I do sometimes, I want to encourage folks to take risks sometimes that are something you've at least thought through and have a plan for it. I know I've said plan a thousand times right now, but that's really what this boils down to is when you want to take a risk, you just have to do the research to put it together so that you have a plan. Because too many times what we see is I might talk to somebody on the back end of that non-existent plan and I say, well, let's talk about how you got here. And it

comes along with such and such was going on and I just didn't want to do it anymore and I did X and now I'm here. And that's not always the case for everybody. But if you have a plan and a direction, it also helps you decide when it's not working, right? You get there and you're bleeding cash. And you say, wow, I can only make it here six months. So you have an exit point, right? To say, I can only spend this much money in six months now.

I need to go back to my cheaper lifestyle. If we don't at least plan things through, then we don't know our entry, our exit, and we don't know when things are really turning in the wrong direction. I know that's more of a negative way of thinking about it, but the positive spin would be true as well. Like I mentioned, when you want to make a change, I want people to be empowered by that change, right? The same is true if you decide to go back to school and get an education. I want you to know that this is bettering your future, and that's why you're willing to take the risk and slow down your career temporarily to speed it back up. The same is true for making this move. I want you to get

there and enjoy it and not have money be the thing that's just constantly in your background saying, like, oh, is this a bad decision? I can't afford it. And so I think that's pretty applicable to most people who want to take risks. Great. Well, Jim, I hope this was helpful. Cleve has posted on how things are going for you. And thank you so much for coming on Smart Money and talking with us. This is fantastic.

Thank you so much. And Magda, thanks as always for sharing your insights. Of course. Happy to be here. And that's all we have for this episode. Remember, listener, that we are here to answer your money questions. So turn to the nerds and call or text us with your questions at 901-730-6373. That's 901-730-NERD.

You can also email us at podcast at nerdwallet.com. Also, visit nerdwallet.com slash podcast for more info on this episode. And remember that you can follow the show on your favorite podcast app, including Spotify, Apple Podcasts, and iHeartRadio to automatically download new episodes. To learn more about NerdWallet Advisors, go to nerdwalletadvisors.com slash smart dash money. Here's our brief disclaimer.

I am not a financial or investment advisor. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances. This episode was produced by Tess Viglin, Cody Goff, and myself. And a special thank you to Magda Domini, Georgia McIntyre, and Emily Canedo. And a big thank you to NerdWallet's editors for all their help. And with that said, until next time, turn to the nerds.

NerdWallet Advisory LLC, DBA, NerdWallet Advisors, is an SEC-registered investment advisor and wholly owned subsidiary of NerdWallet Inc. The advice provided in this episode of Smart Money was for illustrative purposes only and not intended as financial or investment advice specific to your personal facts or circumstances.