Today we have a really special guest. I'm excited to have her not only on the podcast, but also at WCICON22. If you have not yet registered for that and want to come, you can still do so. In person registration goes through January 24th. You can register virtually even after the conference starts, if you like, but make sure you do that so you can catch this awesome conference.

Michelle Singletary is a personal finance columnist for the Washington Post. Her award-winning column “The Color of Money” appears twice a week in dozens of newspapers across the country and is syndicated by the Washington Post news service and syndicate. She's a frequent contributor to NPR and CNN and has been on the Today Show and the Early Show. She even hosted her own TV program for a couple of years. She's authored four books, including the latest What to Do with Your Money When Crisis Hits published this year.

She was raised and educated in Baltimore and lately she's been collecting a lot of awards, including the Eugene Meyer Award, the highest journalistic honor from the Washington Post, the Distinguished Achievement Award from the Society for Advancing Business Editing and Writing, the organization's highest honor. She was also inducted into the Hall of Fame for the Society of Professional Journalists along with names you may be familiar with such as Wolf Blitzer and Peter Mayer.

This year, she won the Gerald Loeb Award for Commentary for a series titled “Sincerely, Michelle.” She's also and perhaps more impressive than all of those awards, the director of Prosperity Partners Ministry, which is a financial program she founded at her church, the First Baptist church. Through the ministry, she teaches various financial aspects and financial topics. As part of this ministry, she and her husband also volunteered to teach financial literacy to prison inmates in various correctional facilities in Maryland.

Michelle was raised in Baltimore by her grandmother. Her parents struggled to take care of their family and before being placed in foster care she and her four siblings were taken in by their grandparents. Michelle talks about how her grandmother taught her everything she knows about money. Her grandmother taught her all of the basics and, despite having very few resources, she was always able to pay the bills and provide. Michelle's grandmother never took any money from the state to provide for her family.

I'll bet you've used her examples many times in columns over the years, too.

“I have, but I have different recurring characters in my column. And Big Mama, that's what we called her, is one of those characters because I just wanted people to know that I didn't come from money. I was abandoned by my parents and my grandfather was an alcoholic and yet this woman, if she held a penny, Lincoln would scream. And she just was amazing. She taught me so much about being grounded. And I'll tell you why that's so important because I didn't come from money. She struggled, but she always paid her bills on time. And then as I progressed financially in my career, got married, had kids, she had laid such a foundation that no matter how much money I make, I still live like I'm going through a recession.

And that really helps me stay grounded financially. Oftentimes the more money you make, the more money you spend. And I often find people who earn a really good living, six figures, but they are just living paycheck to paycheck. There was a survey that showed that a great deal, about like 25%, of people who are making over $150,000 a year, live paycheck to paycheck. And because of how my grandmother raised me, I've been able to sort of avoid the success story where that turns into a financial tragedy so that you have to work until you are 70 or 80, even though you're making good money because you haven't been able to manage it well.”

Yeah, you're preaching to my audience here. Everybody listening to this is either making six figures or soon will be. For sure, it's a real problem. A high income does not guarantee a high net worth for sure.

“It does not. And we are trained in this country to focus on our salaries. And so, doctors and people making those figures, they think, ‘Oh, they've made it.' But you talk to them, and first of all, they're carrying a lot of student loan debt and then they often marry another professional who's carrying a lot of debt. And they want to live that life. They worked really hard and they want to show something for it. So they get a bigger house, they get better cars, they take vacations. But they forget the basics, and it's understandable why. But it's so key, the more you make, you have to focus on your net worth, not your income.”

Exactly. I totally agree with that. Speaking of training, tell us a little bit about yours, about your education and your career up to this point just so people can get to know you a little bit better.

 

Getting Higher Education Without Debt

“I went to University of Maryland College Park on a full academic scholarship. I studied journalism, radio, television and film, minored in journalism in English. And then went to work full-time for the Baltimore Evening Sun in Baltimore, my hometown paper. And then a couple of years in, I actually thought I might switch to the business side of the paper. I went to Johns Hopkins to get my master's in business, because I thought I'd sort of jump ship from daily journalism. It turns out that ink runs in my blood and I just didn't want to give it up. I do have a master's degree. And then I spent probably the last 30 years training myself on investing and working with people on budgeting and how to get out of debt. I've got three decades worth of experience in helping people budget and manage and create a legacy for themselves and their family.”

A lot of docs have thought about going and getting an MBA too. What effect did that have on your career? I can't imagine you've met a lot of other journalists that have an MBA.

“Yeah. Not very many. That is absolutely true. Traditionally journalists get their feet wet by just doing the work. Working for newspapers, internships, sort of getting in there. Here's the thing, I paid cash for my degree and my companies reimbursed me. I wouldn't have it if I had to go into debt. And honestly, in terms of income booster, it didn't do much to boost my income at all. It's not like they go, ‘Oh, you got an MBA, you're going to get a 10% raise.' It did boost my knowledge of what it's like to be in business and economies and things like that. In that sense, I think it made me a better journalist, but I don't think there's a direct correlation between getting that degree and earning more money.

I always tell people to be very careful what you do if you have to do it with debt. Now, if you just wanted to do it for the knowledge, which is what I wanted to do, fine, as long as you're not piling on more debt, because you have to do a cost analysis for these kinds of things. The more education you get, the more education you sometimes want. But you just need to be really careful that you aren't stranding your family with all this debt. My husband has an MBA as well, an executive MBA, but we paid for it out of pocket, no loans, I'm a no loan kind of woman.”

There are a lot of programs where you can get even some graduate degrees without any debt. Certainly, there are plenty of places where you can do your undergraduate education without debt. I think it might be a little tough for somebody with no resources whatsoever to do med school or dental school without at least a contract with the military, or something similar. But certainly, there are MBA programs out there that you can do that with.

“There are not as many as when I started because so many people want to go back and get their degrees. The scholarship money isn't out there, and it used to be more employers paid for it. That's what happened to me. My husband's employer paid two thirds of his degree. We don't find that often now, unless it's directly tied somehow to your job. It's a lot harder for people to find money, to get an advanced degree, without any debt. Unless you want to go to the business side, and you are a doctor, you're like, ‘Yeah, I want to go to administration,' just think very carefully about that and whether or not you can just get that on job experience without carrying all that debt.”

More Information Here: 

Student Loans 101: How to Manage Your Student Loan Debt 

 

It Does Not Take Debt to Get Ahead 

You've been writing about personal finance for a long time, years and years and years. What has surprised you the most over the years about personal finance?

“I'm going to sound like a broken record, but what continuously surprises me is that so many people have bought into this notion that it takes debt to get ahead, that you should be savvy in using debt and that's how you create wealth. And if you talk to wealthy people, they don't use debt. One of my favorite books is The Millionaire Next Door, and that book is all about how you would not suspect these regular folks to be millionaires because they drive American cars or they don't have flashy cars, and they have reasonably priced homes. You would never expect that.

But in America we have brainwashed people to believe that you can be very savvy leveraging your financial future. And it just never ceases to amaze me how much debt people have, how much they put on the credit card, or get a bigger house, or even go to college. And I get it, especially for doctors and people of profession. You've done this. And so, you want your kids to have that kind of path and then they send them to these schools that even on a doctor salary, you can't afford this school, but we just think that's what we have to do for our kids to succeed. And I'm here to tell you that you don't. My husband and I have three children. We have no debt for them for undergraduate or graduate school because we saved the entire time they were growing up. They went to state schools and got a great education, and they're doing extremely well. It is not true that they have to go to the Ivy's or the brand name schools to make it in life. What they'll make in life is a lot of debt.”

 

Inflation – What Do We Do About It? 

I have been looking through your more recent columns and I wanted to ask you about a few of them. The first one was a column about inflation, which I just saw a news article in the last couple of days saying, it's now at the highest it's been since 1982. What steps should consumers and investors take in this new environment?

“One thing that you always have to do is go back to your budget and expenses. That's the first thing. And it sounds so basic, but we have built so many wants into our budget that we don't think, ‘Okay, well let's just look back and see what we can cut out.' And then when prices are rising, you have to think about substitution or perhaps, putting off major projects. I work with people on their budgets all year long. I have a year long program that I have with my church. And I work with people at all income levels. People who are struggling to just pay the light bill and people with lots of money but lots of debt.

And it is harder to get people who make more money to pull back when things happen than it is with other people. Now you might say that I don't have a choice, but I'm fussing at good people who have good salaries, tons of debt, and not a big net worth. They just think that the gravy train is going to keep coming. And it's really hard to get them to look at their budget and cut. And many doctors now know that those high salaries that sort of were automatic now are not necessarily automatic anymore. Healthcare is really expensive, and people are trying to figure out how to cut back. You have to figure out if you can't control that, then you have to control what's coming into your household and what's going out of your household. But that's a hard sell.”

How about on the investment side? Do you think it's worth just staying the course with your investment plan or do you think changes ought to be made given that inflation's gone up four or five points?

“The smartest thing you can do as an investor is not try to time the market. And you time the market by looking at what's going on and go, ‘Okay, I'm going to change it. Inflation is up. I'm going to do something.' No, no, no. You should have a financial plan that is set based on your risk tolerance, how much savings you have, how much debt you have, when you want to retire and you let that plan roll. I know it's heart stopping when the market gets insane and crazy and it's seesawing and rollercoastering, and you're thinking, ‘Well, I have to do some changing.' But if your plan is a tight plan, then there's nothing you need to do. I think we learned that lesson during the great recession. And it was heart stopping. 30% to 50% of a portfolio on paper lost value. But those folks who stuck it out, who had a plan, said, ‘You know what? I'm not going to need this money for 10, 20, 30 years. I'm going to stick it out.' They got back all of those losses and then some. Those who left, those are the ones who locked in losses.

The same thing happened with COVID. Look what happened in March 2020, the market just cratered and people panicked. But if you had a good plan, and I’m not saying I didn't want to scream. I did. But I didn’t make any moves because we have a solid plan. My husband and I have been meeting with financial planners. We've got a plan in place. We're not carrying any debt. And we were like ‘We've got this.' And by August 2020, the market went back and even with the dips, toward the end of the year, it was still returning an amazing amount of returns for people. My portfolio is up like 30%, 40% even during a pandemic. Same with my husband's portfolio.

Now, we're a little bit more risky. We're more equities than most people would be probably where we are, but we know what we're doing. But if you have a balanced portfolio, you have not seen losses this year at all. You've got to not panic and not time the market. Yeah, inflation is up. But when things check out, more people get vaccinated, those COVID cases come down, the supply chain issues subside, the market will do what it does. It'll return a very decent return for you to live off of in retirement over time, about 8% to 10%, which is going to keep you with inflation. If you remember in the 70s and hyperinflation and you're thinking, ‘We're not going to go back to those days.' The Federal Reserve does a great job of managing the economy, and I don't believe that we're going to see those double-digit inflationary periods like we had in the 70s.”

Some of us would love to see rates up. If you're more of a saver than a borrower, for sure it would be nice to make more than 0.5% on your savings these days.

“That is absolutely right. Some savers are like, ‘Let’s go for inflation.' But we do want to be careful about those cheering. Obviously, I'd like more money in my basic savings account, because that's where I keep my emergency money, but I'm okay with that because that money is there to be there when I need it. So that's not growth money. It's doing its job, which is to just sit there and be there in case something happens.”

Yes, it's the return of your principal, not so much the return on your principal.

“That's exactly right. I'm not fretting that my emergency money isn't earning anything because I don't really care. I just want to make sure the principal is there if something happens. If my husband loses his job, if I lose my job, we get sick, that money is there to take care of us. Now I do care what my investments are doing, my retirement and my non-retirement. I pay attention to that and make sure it's invested the way I want to invest it and it's doing what it needs to do. And then I'm okay.”

 

Investment Portfolio 

What is in your investment portfolio?

“Well, I'm going to say caution, but I'm an equities kind of gal. And one of the reasons why is because my husband and I were extremely conservative when we first started out investing. We didn't know much. We didn’t know what we were doing. We were very scared. And so, we're trying to make up for those years where we were way too cautious. Probably more than 90% of my money is in equities, but at mutual funds, low cost indexed mutual funds. I do not have individual stocks. I'm not smart enough to be sitting there looking at all those financials and trying to figure out what stock. I love low cost index funds, and they have done well by me for my retirement plan, for my non retirement money.

For the kids' college funds, we put our money into 529 plans for them. And over 20 years we were able to send all three children to college with no debt and still have some leftover to send them to graduate school with no debt. But typically, the average investor should have a very balanced portfolio, some stocks and bonds based on their risk tolerance. But that's what I like. I like index funds. It's easier for me to have the diversity that I need by investing that way. And I'm very cautious of costs because lots of times people don't pay attention to what their investments cost them, and that money impacts directly your returns.”

Well, you're preaching to the choir here. My listeners know I'm a huge fan of index funds and the vast majority of my portfolio is made up of index funds. You say you're not smart enough to pick stocks. I would argue you're smart enough not to pick stocks.

“I have stocks in my portfolio. This idea that I have to pick individual stocks. Why? If I'm having the S&P 500, I've got stocks. If I'm in Russell, I've got stocks, I've got small cap, I've got midcap, I've got stocks in international companies. And so, there's a whole group of folks who get paid to manage those indexes. And could I do better with individuals? Perhaps. But I could also lose a lot and probably pull my hair out when I see something happening to a particular company. You have to know yourself. And I know that that's not how I want to invest.”

More Information Here: 

10 Reasons I Invest in Index Funds

 

How COVID Has Disproportionately Affected Women 

Let's talk about another one of your columns recently. The pandemic has been called the “She Session.” Why is that? And what can women do to recover from it?

“We found obviously because of how COVID hit and the shutdowns that it adversely affected more women than men. About a quarter of the job losses were experienced by women. And also, because daycare centers and things like that were shut down. And so, the kids couldn't go and they had to either try to figure out how to work from home or quit so they could take care of their children. We still know in this society the women take care of the children. And also, because so many of the jobs that were lost or impacted were in the service industry, which predominantly employed women. And so, that's what happened. Women were hit very hard, and still are because of the pandemic.

Now as we try to recover, I don't think I need to tell all this crowd how important it is to get more people vaccinated, because that really is the key to getting our economy back on track. If you were in a service-related industry, I think a lot of women are now thinking, ‘You know what? I need to have some skills that can weather a storm, or I could have skills where I could work at home.' Obviously, we still need service-related jobs. And people out in the field can't do their job at Target from home. But I think lots of women realize that they need to do some skill boosting to try to get through this COVID and on the other side, earn more money and stability for their family.”

It was amazing how much more affected people that had to go to work were. And that includes doctors. Most doctors listening to this podcast remember March and April and May of 2020, and their incomes went down 10%, 20%, 40%. And all of a sudden elective procedures were canceled. And it turns out your entire practice has elective procedures, like joint replacements. And all of a sudden, your income dries up. Meanwhile, anybody who was working online already, it's like they didn't have a hiccup at all in their income stream.

“That's exactly right. I felt bad for my dentist who I have been with for roughly 30 years. I asked him about his experience with COVID. He saved enough that he could cover people's salaries, even though they couldn't come into the office, but he was a week or two away from having to lay off people before things opened back up. And so, he was very smart with how he ran his practice. He had savings for the practice. He wasn't living it large with the practice so he was able to carry his staff. So, he didn't have to let them go and kudos to him for being able to do that.”

I wonder if a lot of times employees realize things like that, what the business owner has done for them and maybe they should ask about that sort of thing more in job interviews.

“Well, there's another trend called the great resignation and people are thinking, ‘You know what? Life is way too short.' Including people in the medical field. They're like, ‘You know what? I'm in the trenches. People are coming to you, some vaccinated, some not, putting your health at risk. And I did go to get this degree to be this doctor, but this is not worth my life.' So you see an outflux of a lot of people in the medical profession, nurses and people on the lower end of the pay scale in terms of the medical field, it's been a tough ride for them as well.”

Yeah, it sure has. I think anybody who works in a hospital right now understands just how serious the staffing concerns are and how much that resignation is people leaving the field completely, retiring early, being burned out. And how much of it is people switching jobs. It seems like a merry go-'round in my city with nurses. I think nursing pay has gone up about 25% this year because they're just trying to get people in the door and get them to stay there. But what's happening I think is the nurses are bounced around from hospital to hospital and just trying to get a better job and take advantage of it.

“Yes, and you're right about early retirement. Lots of people have been retiring early. There has been a great exodus of people in their late 50s saying ‘I'm done. I've got to live a life.' And it's a hard job, long hours. If people have done well and have saved, invested, they can retire early.”

I think people are riding a lot of the recent good returns we've had. Over the last 10 years there have been great returns in the markets. And they go, “Well, maybe I didn't think I was going to be able to retire now, but maybe I can.”

 

Social Media and Debt Collectors 

You've had a couple other columns recently about social media, which is something that fascinates me, partly because I make a living online with social media, but also because it's been such a game changer in the world the last few years. But one of your columns was suggesting that people be aware of “FOMO spending,” you called it. Fear of Missing Out spending. And the other one was pointing out that debt collectors can now hound you on social media. What are your thoughts about social media? Should we just ban it all together?

“Back in the day, I sort of thought that I was one of the last adopters. But it's very helpful to people when it's done right. I'm very active on Twitter. That's sort of my platform. You just need to be very careful about what you put out and what you take in. It's immediate reaction to everything. So, it can be really tough. Now on the side of the Consumer Financial Protection Bureau which is the Consumer Watchdog, under the Trump administration theyq changed the rules so that it will allow debt collectors to contact you either through text messages, emails, direct messages on your social media platforms. And that could open the door to so much because we do know that debt often is sold and resold and resold, and it's not sold with the backup information.

Lots of people are being contacted that don't actually owe the debt. And so, they put in a rule that says, okay, they can contact you through these other mediums because many of us, that's how we communicate now. They don't like calling us anymore, and we are not answering the phone anyway, because it's just a lot of scammers. And so, people aren't picking the phone up. Now the rule says that if they do contact you through social media, they can't post anything on your page or anything that will allow your friends or family or your contacts to know that they are trying to collect a debt. They have to send you a private message. And in that private message, they have to say upfront, I'm trying to collect a debt from you. They can't sort of slip into your Facebook and say, ‘Hey, when did we go to college back in the day?' and not say that they're debt collectors.

My concern with that is that we're getting so much spam and scam messages through email and text messages. And even in some of our social media platforms, I think some people will be scammed into paying a debt that they don’t owe or into giving up information that could lead to a scam down the road. What I'm telling people is that if you know you owe debt, and you get a text message or email or something on your social media platform, don't respond, don't click on anything. Look up that debt collector, make sure it's a legitimate company, independently Google them and then contact that company outside of that platform so that you can protect yourself. Because the scammers know, they read the paper, too. They're online. They know how to craft their scams and schemes to flow with the current news. You just need to be very, very careful. I don't click on anything, even if I contact my bank and I go ‘Okay. Let me just call you independently to make sure.'”

Yeah. That's probably a good policy. Clicking on links is a good way not only to get scammed, but to download malware onto your computer. You have to be careful with it, for sure.

 

Sincerely, Michelle 

Now I want to talk about a recent series you did. This was an award-winning series titled “Sincerely Michelle.” It explained misconceptions involving race, regarding investing, credit scores, homeownership, and more. How does the experience of Black Americans differ when it comes to personal finance and investing?

“Where do I start? This was a 10-part series, and it sort of was born out of a lot of the unrest that happened after George Floyd and then just the last couple summers. I don't talk about race a great deal in my column. Because from my perspective, money's all green. We all have to sort of deal with it. But I just felt compelled to talk about what it's like to be a Black American, even as what many people would consider a successful Black American. And the things that I've had to deal with, even at my level of success, the microaggressions. I walk into a room and there's an assumption that I don't know what I'm talking about.

Even sometimes when I give a speech, people will come up to me, and I know that they mean well, and they're saying, ‘Oh my gosh, wow.' But the level of enthusiasm often makes me feel like, well, what did you think? I've been working for the Post for 30 years. I have a master's degree in business. What did you think I was going to do? And it's just the expectation that you are not going to be excellent. And even at the Washington Post, when I got there, people were asking behind my back, ‘Well, how did she get to the Post?' I got there at a fairly young age but I also got there because I had expertise in some different areas.

And because I heard all the stuff going on, this was the first column I wrote in a series about affirmative action. I asked my editor at the time, ‘Did you hire me just because I was Black?' And he said, yes. And I just was floored. And I started to tear up, and he said come into my office and he sat me down. And I'm thinking in my head all those people were right. I'm just some sort of token here. And then he said to me, ‘But Michelle, I hired you because you're Black, because you have a unique experience. You grew up with no money. So you have a different perspective that you bring to the Washington Post business section. As we write about the economy, if we write about personal finance, you understand what it's like not to have.'

He said, ‘I hired you because you have a master's degree in business. I hired you because you're a woman. Because you grew up in inner city Baltimore. I hired you because you had, at the time, developed an expertise in bankruptcy coverage.' And at that time there were a lot of corporate bankruptcies, and no one on the staff had experience in covering bankruptcy. So, he hired me because I had been covering bankruptcies for the Baltimore Evening Sun. And he just went through all of these things. And so, I said, ‘Why didn’t you start there? Why did you just say yes, I hired you because of that?' Because he said, ‘I don't want you to run away from your Blackness. That is an asset to the Washington Post. And there's nothing wrong with the fact that I wanted diversity on our staff, but you did not take a job from someone else more deserving. This was your job to have.'

And so, each part of the series tried to examine a lot of myths as it relates to African Americans. For example that we buy sneakers and all we do is we buy all these consumer goods when we should be investing. Even one pair of Jordan sneakers are 200 something dollars is not going to send your kid to college. And reparations, why should Black people receive reparations? And just sort of going through the historical perspective, why we still should be talking about slavery. And I was talking to an expert, a Black historian, out at Duke University. And I talked about how I got all this pushback. Well, why do you keep talking about slavery? And he said, when you talk about it in a sense of generations, it's not that long ago. And that is absolutely true. I am a direct descendant of enslaved people. My grandmother's grandfather was enslaved. And because of all of that happened to her though that she passed a lot of those things off to me, the fear of financial institutions. And why does she fear them? Because they would take your property. They would burn your town down.

Talking about microaggressions, when people say to me, ‘Oh, you speak so well.' They wouldn't say that to you, Jim. They wouldn't say ‘Jim, you speak so well.' They expect you to speak well. You have a podcast. You're a brilliant person. Why would you say that to me? And so, I wanted just to open a door to a conversation, which is why it's called ‘Sincerely Michelle.' It's a letter. I don't want to yell at you. I don't want you to feel guilty. I just want you to understand what it's like to be Black in America. And it's tough even for those who succeed, because then they say, ‘Well, you made it. Why can't other people make it?' I had a whole bunch of people helping me along the way. I had a first-time home buyer's program that helped me buy my first home. I got a scholarship because the Baltimore Evening Sun had been peppered with community complaints about how they covered the Black community because they didn't have enough Black journalists.

All of those things were put into place to help me succeed. I didn't do it by myself. And when you have all this going on, you just want to explain why there's so much unrest, why there's still police brutality, why there's still disparity in what I might get paid and someone with the credentials that I have is getting paid more than me because they are a white man or a white woman. And I just wanted to say, listen, this is still going on. This is not in the past. This is still our today. And I just felt it was really, really important. And the response was typical. Lots of emails that I couldn't even repeat on air, but then some that just made me cry because they thought ‘You know what? I had never thought about it that way.' And that's why I did the series, for that kind of comment where people's eyes were opened, that said, ‘I did not know that that was still going on.'”

Let's turn the page a little bit. You're one of our keynote speakers at WCICON22. We are going to be giving away your book What to Do with Your Money When Crisis Hits a very timely book these days. What will people learn from that book?

 

What to Do with Your Money When Crisis Hits

“When we came up with the title for the book, one of the things that concerned me was people, especially people who are doing well for themselves, would say, ‘What do you do when a crisis hits? Oh, this isn't for me.' But this pandemic has shown us that no matter where you are on the economic ladder, you could be impacted, you could lose your job. And we talked about this earlier for some doctors and their practices. It was an economic downturn. I wanted to write a book that says no matter where you are, you've got to be careful about how you spend your money, and here's how.

A great deal of the book talks about building a legacy and lessons that I learned from my grandmother. Learning when I didn't have any money, to now that I have money, how do I spend it well? How do I make sure I'm investing well? How do I make sure that I'm not living so far above my means that no matter what my salary is, I can still be broke?

That's what I want to talk to the audience about. And also, just making sure that you're managing and you are getting what you want out of the work that you're doing. My husband and I have sort of a legacy plan. We knew that we wanted to send our children to college debt free. We wanted to give that gift to them. We have our wills and estate plan in place. My husband loves this quote from Warren Buffet. I'm not going to quote it exactly right. He always gets it better than me. But he says, ‘I want to leave my children enough that they do well, but not so much that they don't do anything.' That's what our plan is for our children. We're going to leave them some wealth, but not so much so that they can sort of just sit back and go ‘I got it.' We trained our children from the time they were little about managing money, not overspending.

I want to talk to this audience about how you sometimes lose focus the more money you make. You want to create a legacy that helps other people. You want to create a legacy of giving. A great deal of our income, 10% of our gross income, goes to charity. My husband and I give back to the community. We are very active in our community in terms of volunteering. My husband and I teach at prisons to teach inmates who are about to be released how to handle their money.

I guess maybe this is a theme of my talk, as to whom much is given much is required. And you are at a part of your life where you have the financial resources, the intellectual resources and the bandwidth to give back beyond just being who you are. I could just say, ‘I'm a syndicated columnist for the Washington Post' and be done with that. That's just the top of my field. That's not enough for me because it could be gone tomorrow. What else is going to be my legacy?

When my youngest said she wanted to be the teacher, I was so happy. I was just thrilled. And you would think with me earning six figures, my husband earning six figures, a multimillionaire would be thinking ‘Really? A teacher?' But I thought about the people who had an impact in my life and they were always educators. And the fact that my daughter wanted to do that for somebody else. And not only that, she's in special education. I'm so proud. Guess what? I had taught my child how to live off of that salary. And she is probably going to be richer than somebody's mama and daddy who's a doctor because she knows how to handle that teacher salary.

That, to me, is what this is all about. And I think the whole conference is about financial wellness, health and financial health. And it's not just about the zeros behind that. What are you going to leave to your children, your community and the world from all of this you've been able to gain? And to me, I want the headline to say that I volunteered in my community, that I sent my kids to college debt free, that I embraced the things that they wanted to do, their calling and I didn't push them into STEM or push them to be a financial planner or something that I thought would make more money. I listened to them ‘What do you want to do with your life?' And then supported them in a way that they can live off of the salary that they make.”

“To whom much is given, much will be required.” Can we use that as the title for the talk?

“You can. I love it. I was taught to think about what to use and that’s it. Because that's really what it's about. We're in a unique position, those of us who have done well for ourselves, to make a great deal of difference. And it can't just be about a bigger house, a fancier car, a world trip. Now I'm not saying don't do those things. We have a beautiful home. I'm not so into cars. We don't really care about that. We take five-star vacations, but we also build into our budget as a line item, as important as our mortgage, tithing to our church. That is paramount to who we are and what we do. We built into our budget, not having our kids come out with debt and intentionally raising them in a way that they don't think that they are rich. And one of the things I have learned in working with people, especially people who have money, oftentimes their children are not good money managers. Their children are overindulged and overprivileged, and they don't have a sense of community.

You scrimped and saved and maybe even your parents scrimped and saved, but oftentimes you're not passing it on to your children. Because I get it. People will say things like ‘I want them to have it better than I did. I don't want them to struggle.' That is wrong. It's bad. So bad. I want my kids to suffer, and they did, but it made them better human beings because my children are not entitled at all. If I ever could be immodest about something, that is something I want to be immodest about. They are not entitled at all. They want to get what they want on their own. And I just am so proud of that. And that's the legacy we can leave them.”

Our time is getting short, but I want to ask you a little more about this Prosperity Partners Ministry. Can you share an experience, an anecdote, from teaching financial literacy in prisons and what that's been like?

 

Prosperity Partners Ministry 

“Because I was sort of rescued from foster care, I've always had this sense of giving back because so many people stepped in to save me. Even when I was in my early 20s, I had my first little dog on my own, because I've been a homeowner since I was about 21, right out of college, a year out of college. I would take my dog and visit nursing homes. It was called Pets on Wheels. They found that nursing home residents didn't necessarily respond to volunteers. But when you brought the pets in, they would just brighten up. And so, I participated in that program. And from there I moved on to different kinds of volunteer programs. And I realized I had a knack for managing money. I learned it from my grandmother. And so, I wanted to do something when I moved to the Washington DC area.

At my church, I created this ministry, but I also realized that you can't just have one workshop. It doesn't work that way. It takes time for people to change behaviors. And so, I wanted to create a program in which we would meet regularly for a very long time. It's a year-long program, and every month we have a workshop which I teach. It's about a two to three hour workshop about money. And you can imagine, it could be four or five hours. People are so enthralled because they are hungry for the information. And in addition to that, which is unique about our program, I thought about Alcoholics Anonymous and how they are set up. They have sponsors. They have people who kind of walk along your journey so when you fall, they're there to help you out or to cheer you on.

And I wanted something like that with money. And so, we have money mentors who walk along with people and help them do their budget, fuss them when they don't do their budget, fuss at them when they're overspending. That's what the ministry is. We have created a team of people. We call them senior partners who walk along and help people. They're not financial experts. They're not bankers or anything, just regular people. And the criteria are, they were in debt, they got out of debt. They weren't savers, now they're savers. They help other folks. And then as a part of that, our church also encourages us to have our own sort of mission program within our ministry. I was asked to speak at a prison. And so, I went in to teach a financial class and I just loved it. I mean, think about this population that we've just thrown away.

But the fact that matters is most of them are going to come out and they're not going to come out with skills to handle their money. And honestly, particularly when it comes to African Americans, a lot of them are there for selling drugs. And why did they sell drugs? And I know that people want to just say, ‘degenerates of society,' but really a lot of times they got into drugs because they were just trying to get money, to feed their family. Like 13-year old’s feeding their eight-year-old brother or sister. And they wanted things like they saw everybody else had. They wanted nice sneakers. They wanted clothes like they saw other families have.

Now that's not the reason why you should do it, obviously, but then they're in prison, we lock them up, we don't give them any skills. Now when they come out, it's going to be hard for them to get a job. And when they do get a job, they are going to want more stuff. I really wanted to create a program to say, ‘Listen, you're going to have it harder. So let me teach you how to handle your money so that when you get out, first of all, you don't go back to those habits that got you in there. You don't resort to that to make money. Let's figure out how to legitimately make your money and use it in a way that can create wealth for yourself and change your legacy.' My husband and I teamed up and we went inside institutions. It's such a worthwhile thing because these are folks that we just want to forget about, and they need help, too. And the more we can help them do better, we can help create citizens who will be productive. Because everybody's crying about the programs for them and why are we giving them money for that? Think of it selfishly, because if we train them and give them education and give them some resources, they're not going to go back to a life of crime. And that might mean they're not going to steal your car or break into your house. And that's important, right?”

Societal benefits are there, for sure. They actually have to be better at managing money because when they come out, they're going to have that felon status. It's going to be harder for them to make good money. They're going to have to be even better at managing it than the average Joe might.

“That's exactly right. And you know what? My presentations are not any different to them. I don't change anything. It's the same thing I teach to the rich people or I say people earning high incomes, because they're not rich. They just have high incomes. The same lessons.”

Before we wrap up, you have got the ear of 30,000 to 40,000 high-income earners, mostly doctors. What else should they know that we haven't talked about already?

“I would say you're so busy doing what you do and you've worked so hard to learn what you do. Take some time to come up with a personal financial plan for yourself. And that is more than just investments. That's more than what's the next house I'm going to get, the next Mercedes Benz, or whatever. At the end of the day, you’ve earned a good income. What would you have to show for that income? And to me, that's what you should be focused on. That's the difference. Who's going to remember you when you're gone and how will they remember what you did with those vast resources that you were able to get for yourself? And that means creating a legacy and that means having a plan.

Do well for yourself, get the things in life that you enjoy. But also, what are you giving back? Because that's also part of being well. I think those of us who are earning good money, oftentimes we sort of think, ‘Well, I got mine, and they need to get theirs and they need to pull themselves up by the bootstraps.' But just remember that you got there because a whole bunch of people helped you. And that's how I feel. I had a whole bunch of people help me and I want to turn around and do the same for somebody else.”

Awesome. Well, it's been great having you on here, Michelle Singletary, award-winning columnist, best-selling author, now with her newest book out What to Do with Your Money When Crisis Hits. You can check that out or better yet, come to WCICON22. We'll give you a free copy. You can hear her keynote talk there. You can still register for this conference at whitecoatinvestor.com/wcicon22. Michelle, it's been wonderful to have you here. Thank you so much.

 

2021 has been a year with a long list of tax changes and we will still face additional surprises in early 2022. As a result, your current tax plan may not be tax-efficient and need a tune-up to make sure you’re keeping more of your hard-earned money! Medical professionals all over the country rely on Cerebral Tax Advisors for proactive tax planning strategies for doctors, helping them lower their effective tax rate and increase their wealth through court-tested and IRS-approved tax strategies. As the spouse of a physician, the lead tax strategist, Alexis Gallati, has nearly two decades of experience in high-level tax planning strategies and multi-state tax preparation. Cerebral’s services are flat-rate and they are focused on their client's return on investment. Check out Alexis’ book “Advanced Tax Planning for Medical Professionals” or if you’d like to schedule a free consultation, visit their website at www.cerebraltaxadvisors.com.

 

WCICON 2022

Time is almost up to register for The Physician Wellness and Financial Literacy Conference. The conference is in Phoenix on February 9-12, 2022. We will, of course, have incredible speakers and presentations on financial literacy but will also have a big focus on the wellness side of the event. There will be fantastic speakers, presentations, and activities to help revitalize you after what has been a difficult few years for everyone. If you cannot attend the in-person event, we are also offering a virtual component. Get your tickets today!

 

Milestones to Millionaire

#45 – Pediatrician Pays off $185K in 3.5 Years

Renting a less comfortable home than they would have preferred, this couple focused on crushing their student loans. Not being big spenders helped accomplish this goal. Their net worth may have been higher now if they had invested versus paying off loans but everyone's crystal ball is cloudy. They don’t regret the financial freedom and safety being debt-free gives them.


Sponsor: Bob Bhayani at DrDisabilityQuotes.com

 

Quote of the Day

Today our quote is anonymous. If anyone knows who said this I will give them credit on the podcast.

“Tend your portfolio as you would a cactus.”

I think the idea there is to keep your hands off. You don't want to be messing with your portfolio in response to market conditions all the time. You'll end up chasing your tail.

 

Full Transcript

Transcription – WCI – 242

Intro:
This is the White Coat Investor podcast where we help those who wear the white coat get a fair shake on Wall Street. We've been helping doctors and other high-income professionals stop doing dumb things with their money since 2011. Here's your host, Dr. Jim Dahle.

Dr. Jim Dahle:
This is White Coat Investor podcast number 242 – Avoiding debt and giving back with Michelle Singletary.

Dr. Jim Dahle:
2021 has been a year with a long list of tax changes, and we'll still face additional surprises in early 2022. As a result, your current tax plan may not be tax efficient and may need a tune-up to make sure you're keeping more of your hard-earned money.

Dr. Jim Dahle:
Medical professionals all over the country rely on Cerebral Tax Advisors for proactive tax planning strategies for doctors, helping them lower their effective tax rate and increase their wealth through court tested and IRS approved tax strategies.

Dr. Jim Dahle:
As a spouse of a physician, the lead tax strategist, Alexis Gallati has nearly two decades of experience and high-level tax planning strategies and multi-state tax preparation. Cerebral services are flat rate and they're focused on their client's return on investment.

Dr. Jim Dahle:
Check Alexis's book, “Advanced Tax Planning for Medical Professionals,” or if you'd like to schedule a free consultation visit their website at www.cerebraltaxadvisors.com.

Dr. Jim Dahle:
Welcome back to the podcast. We're recording this on December 13th. It'll go live on December 23rd. You should be aware that the next day after this goes live, December 24th through January 3rd, we are having a sale of our three main online courses.

Dr. Jim Dahle:
That includes our Financial Wellness course. That's the Fire Your Financial Advisor course with the CME credit with the additional wellness content in it. It includes our Fire Your Financial Advisor course. This is our flagship course that helps you design your own financial plan. And also, the CFE 2021 course – Continuing Financial Education 2021 course.

Dr. Jim Dahle:
If you buy any of those during that time period, the 24th through the 3rd of January, we will give you CFE Las Vegas absolutely free. That's another 50 hours of content. It's basically more than doubling your content for most of these courses. And so, it's really a pretty awesome addition to what you're getting for that.

Dr. Jim Dahle:
Check that out at whitecoatinvestor.teachable.com. Look for the bundles there. This will show up as the course bundle. Basically, we're bundling these courses together for that time period and you can get a great deal on it. If you want to get yourself a Christmas present or you want to get somebody else a Christmas present, this is a great way for you to be able to do. Especially if you waited until the last minute when you can buy this one on Christmas Eve no problem.

Dr. Jim Dahle:
All right, let's do our quote of the day. This one is an anonymous quote, as far as I know. If you know who said it, I'll give him credit in a later podcast, but it is “Tend your portfolio as you would a cactus.” And I think the idea there is to keep your hands off. You don't want to be messing with your portfolio in response to market conditions all the time. You'll end up chasing your tail.

Dr. Jim Dahle:
I want to make sure I thank you for what you do. It's been a long year with lots of challenges. We had that pandemic come up and right when we thought it was getting better, we had Delta come up. And right when we thought maybe it would get better soon, we had Omicron come up. And it feels like it's never going to end. I assure you it is going to come to an end eventually, or at least some sort of low-level endemic state that we can live with and get back a bit more to our normal lives. Thank you for hanging in there and thanks for what you do.

Dr. Jim Dahle:
We got a really special guest on today. I'm excited to have her not only on the podcast, but also at WCICON 22. If you have not yet registered for that and want to come, you can do so. In person registration, I believe goes through January 24th, that was the latest we could push it, because we got to have the numbers for the food people.

Dr. Jim Dahle:
You can register in person up until January 24th. You can register virtually even after the conference starts, if you like, but make sure you do that so you can catch this awesome conference.

Dr. Jim Dahle:
Our guest Michelle Singletary will be one of the keynote speakers there, but you can register at whitecoatinvestor.com/wcicon22. Let's get Michelle on the line.

Dr. Jim Dahle:
Michelle Singletary is a personal finance columnist for the Washington Post. Her award-winning column “The Color of Money” appears twice a week in dozens of newspapers across the country and is syndicated by the Washington Post news service and syndicate.

Dr. Jim Dahle:
She's a frequent contributor to NPR and CNN and has been on the Today Show and the Early Show. She even hosted her own TV program for a couple of years. She's authored four books, including the latest “What To Do With Your Money When Crisis Hits” published this year.

Dr. Jim Dahle:
She was raised and educated in Baltimore and lately she's been collecting a lot of awards, including the Eugene Meyer award, the highest journalistic honor from the Washington Post, the distinguished achievement award from the Society for Advancing Business Editing and Writing, the organization's highest honor. She was also inducted into the Hall of Fame for the society of professional journalists along with names you may be familiar with such as Wolf Blitzer and Peter Mayer.

Dr. Jim Dahle:
This year, she won the Gerald Loeb award for commentary for a series titled “Sincerely, Michelle”. She's also and perhaps more impressive than all of those awards, the director of Prosperity Partners Ministry, which is a financial program she founded at her church, the First Baptist church. Through the ministry, she teaches on various financial aspects and financial topics. As part of this ministry, she and her husband also volunteered to teach financial literacy to prison inmates in various correctional facilities in Maryland. Michelle, welcome to the white coat podcast.

Michelle Singletary:
Oh, thank you for having me.

Dr. Jim Dahle:
Let's start at the beginning. Tell us a little bit about your upbringing and how that affects your views on money.

Michelle Singletary:
Sure. I was raised in Baltimore by my grandmother. My parents had some issues and we ended up nearly in foster care, but I was rescued by my grandmother and my grandfather. I went to go live with her when I was four and there were five of us total. I had an older sister who was eight. There was me, I was four, a sister who was three and twin brothers, just about two years old.

Michelle Singletary:
That was quite a bit of a giant experience for my grandmother and us. She was the one who taught me everything I know about money, the basics. She was just unbelievably good with her money, even though my grandfather, although he was quite a sweet man, had a lot of issues with drinking and so his paycheck often didn't make it home.

Michelle Singletary:
And even with that, she was able to raise us and provide for us without actually taking the cash payment, that time we referred to it as welfare from the state. She said, “No I'm going to handle this, just give me medical coverage for the children and I got it from here”.

Michelle Singletary:
And I just watched her manage her money in a way that was so impressive. And I’m not always happy about the things that she couldn't get us. But now with my own children, I understand why she did what she did. And I'm in an awe at what she was able to do with so little.

Dr. Jim Dahle:
I'll bet you've used her examples many times in columns over the years too.

Michelle Singletary:
I have, but I have different recurring characters in my column. And Big Mama, that's what we called her, is one of those characters because I just wanted people to know that I didn't come from money. I was abandoned by my parents and my grandfather was an alcoholic and yet this woman, if she held a penny, Lincoln would scream. And she just was amazing.

Michelle Singletary:
She taught me so much about being grounded. And I'll tell you why that's so important because I didn't come from money. She struggled, but she always paid her bills on time. And then as I progressed financially in my career, got married, had kids, she had laid such a foundation that no matter how much money I make, I still live like I'm going through a recession.

Michelle Singletary:
And that really helps me stay grounded financially. Oftentimes the more money you make, the more money you spend. And I often find people who earn a really good living, six figures, but they are just living paycheck to paycheck. There was a survey that showed that a great deal, about like 25% of people who are making over $150,000 a year, live paycheck to paycheck.

Michelle Singletary:
And because of how my grandmother raised me, I've been able to sort of avoid the success story where that turns into a financial tragedy so that you have to work until you are 70 or 80, even though you're making good money because you haven't been able to manage it well.

Dr. Jim Dahle:
Yeah, you're preaching to my audience here. Everybody listening to this is either making six figures or soon will be. For sure, it's a real problem. A high income does not guarantee a high net worth for sure.

Michelle Singletary:
It is not. And we are trained in this country to focus on our salaries. And so, doctors and people making those figures, they think, “Oh, they've made it”. But you talk to them, and first of all, they're carrying a lot of student loan debt and then they often marry another professional who's carrying a lot of debt.

Michelle Singletary:
And they want to live that life. They worked really hard and they want to show something for it. So they get a bigger house, they get better cars, they take vacations. But they forget the basics, and it's understandable why. But it's so key, the more you make, you have to focus on your net worth, not your income.

Dr. Jim Dahle:
Exactly. I totally agree with that. Speaking of training, tell us a little bit about yours, about your education and your career up to this point just so people can get to know you a little bit better.

Michelle Singletary:
Sure. I went to University of Maryland College Park on a full academic scholarship. I studied journalism, radio television and film, minored in journalism in English. And then went to work full-time for the Baltimore Evening Sun in Baltimore, my hometown paper.

Michelle Singletary:
And then a couple of years in, I actually thought I might switch to the business side of the paper. I went to Johns Hopkins to get my master's in business, because I thought I'd sort of jump ship from daily journalism. It turns out that ink runs in my blood and I just didn't want to give it up. I do have a master's degree. And then I spent probably the last 30 years training myself on investing and working with people and budgeting and how to get out of debt. I've got three decades worth of experience in helping people budget and manage, and create a legacy for themselves and their family.

Dr. Jim Dahle:
A lot of docs have thought about going and getting an MBA too. What effect did that have on your career? I can't imagine you've met a lot of other journalists that have an MBA.

Michelle Singletary:
Yeah. Not very many. That is absolutely true. Traditionally journalists get their feet wet by just doing the work. Working for newspapers, internships, sort of getting in there. Here's the thing, I paid cash for my degree and my companies reimburse me. I wouldn't have it if I had to go into debt.

Michelle Singletary:
And honestly, in terms of income booster, it didn't do much to boost my income at all. It's not like they go, “Oh, you got an MBA, you're going to get a 10% raise.” It did boost my knowledge of what it's like to be in business and economies and things like that. In that sense, I think it made me a better journalist, but I don't think there's a direct correlation between getting that degree and earning more money.

Michelle Singletary:
I always tell people to be very careful what you do if you have to do it with debt. Now, if you just wanted to do it for the knowledge, which is what I wanted to do, fine, as long as you're not piling on more debt, because you got to do a cost analysis for these kinds of things.

Michelle Singletary:
And the more education you get, the more education you sometimes want. But you just need to be really careful that you aren't stranding your family with all this debt. My husband had an MBA as well, an executive MBA, but we paid for it out of pocket, no loans, I'm a no loan kind of woman.

Dr. Jim Dahle:
There are a lot of programs where you can get even some graduate degrees without any debt. Certainly, there are plenty of places where you can do your undergraduate education without debt. I think it might be a little tough for somebody with no resources whatsoever to do med school, dental school without at least a contract with the military, et cetera. But certainly, there are MBA programs out there that you can do that with.

Michelle Singletary:
There are not as many as when I started because so many people want to go back and get their degrees. The scholarship money isn't out there, and it used to be more employers paid for it. That's what happened to me. My husband's employer paid two thirds of his degree. We don't find that often now, unless it's directly tied somehow to your job. It's a lot harder for people to find money, to get an advanced degree, without any debt. Unless you want to go to the business side, and you are a doctor, you're like, “Yeah, I want to go to administration,” just think very carefully about that and whether or not you can just get that on job experience without carrying all that debt.

Dr. Jim Dahle:
Yeah, exactly. You've been writing about personal finance for a long time, years, and years and years. What has surprised you the most over the years about personal finance?

Michelle Singletary:
I'm going to sound like a broken record, but what continuously surprises me is that so many people have bought into this notion that it takes debt to get ahead, that you should be savvy in using debt. And that's how you create wealth. And if you talk to wealthy people, they don't use debt.

Michelle Singletary:
One of my favorite books is “The Millionaire Next Door”, and that book is all about how you would not suspect these regular folks to be millionaires because they drive American cars or they don't have flashy cars, they have reasonably priced homes. You would never expect that.

Michelle Singletary:
But in America we have brainwashed people to believe that you can be very savvy and leveraging your financial future. And it just never ceases to amaze me how much debt people have, how much they think let's put it on the credit card, let's get a bigger house, even to college. And I get it, especially for doctors and people of profession.

Michelle Singletary:
You've done this. And so, you want your kids to have that kind of path and then they send them to these schools that even on a doctor salary, you can't afford this school, but we just think that's what we have to do for our kids to succeed. And I'm here to tell you that you don't,

Michelle Singletary:
My husband and I have three children. We have no debt for them for undergraduate or graduate because we saved the entire time they were growing up, 20 years. And yeah, they went to state schools and got a great education, and they're doing extremely well. It is not true that they have to go to the Ivy’s or the brand name schools to make it in life. What they'll make in life is a lot of debt.

Dr. Jim Dahle:
Yeah, exactly. I have been looking through your more recent columns and I wanted to ask you about a few of them. The first one was a column about inflation, which I just saw a news article in the last couple of days saying, it's now at the highest it's been since 1982. What steps should consumers and investors take in this new environment?

Michelle Singletary:
One thing that you always have to do, you'll fall back when things are happening and especially with inflation or you have some income destruction, is to go back to your budget and expenses. That's the first thing. And it sounds so basic, but we have built so many wants into our budget that we don't think, “Okay, well let's just look back and see what we can cut out”.

Michelle Singletary:
And then when prices are rising, you have to think about substitution. Maybe you are the person who is “I've got to have this kind of whatever it is at the grocery store.” And you might start looking around for store brand things, or, perhaps put off major projects. Like right now, it's really hard to get things done, because of materials, the supply chain issues, which is contributing to inflation.

Michelle Singletary:
Maybe you decided you wanted to put on a deck. Well, maybe you just wait till next summer till things kind of shake themselves out. Those are some of the kinds of things that you got to fall back on.

Michelle Singletary:
And I tell you, this is so true because I work with people in their budgets all year long. I have a yearlong program that I have with my church. And I work with people at all income levels. People who are struggling to just pay the light bill and people with lots of money, but lots of debt.

Michelle Singletary:
And it is harder to get people who make more money to pull back when things happen than it is with other people. Now you might say that I don't have a choice, but I'm fussing at good people who have good salaries, tons of debt, and not a big net worth. They just think that the gravy chain is going to keep coming. And it's really hard to get them to look at their budget and cut.

Michelle Singletary:
And many doctors now know that those high salaries that sort of were automatic now are not necessarily automatic anymore. Healthcare is really expensive and people are trying to figure out how to cut back. Reimbursements are lower, malpractice insurance. I mean, all the things that it takes to do what you do, it costs more. And so, you got to figure, “Okay, if I can't control that, then I've got to control what's coming into my household and what's going out of my household”. But that's a hard sell.

Dr. Jim Dahle:
For sure. How about on the investment side? Do you think it's worth just staying the course with your investment plan or do you think changes ought to be made given that inflation's gone up four or five points?

Michelle Singletary:
Well, the one thing, the smartest thing you can do as an investor is not try to time the market. And you time the market by looking at what's going on and go, “Okay, I'm going to change it. Inflation is up. I'm going to do something”. No, no, no. You should have a financial plan that is set based on your risk tolerance, how much savings you have, how much debt you have, when you want to retire and you let that plan roll.

Michelle Singletary:
And so, I know it's heart stopping when the market gets insane and crazy and it's seesawing and rollercoastering, and you're thinking, “Well, I got to do some changing”. But if your plan is a tight plan, then there's nothing you need to do.

Michelle Singletary:
I think we learned that lesson during the great recession. And it was heart stopping. 30% to 50% of a portfolio on paper lost value. But those folks who stuck it out, who had a plan, said, “You know what? I'm not going to need this money for 10, 20, 30 years. I'm going to stick it out”. They got back all of those losses and then some. Those who left, those are the ones who locked in losses.

Michelle Singletary:
And the same thing with COVID. Look what happened in March, 2020, the market just cratered and people are like “Aah”. But if you had a good plan, and I’m not saying I didn't want to scream. I did. But I didn’t make any moves because we have a solid plan. My husband and I have been meeting with financial planners. We've got a plan in place. We're not carrying any debt. And we were like “We got this”.

Michelle Singletary:
And what happened by August 2020, the market went back and even with the dips, toward the end of the year, it was still returning an amazing amount of returns for people. My portfolio is up like 30%, 40% even during a pandemic. Same with my husband's portfolio.

Michelle Singletary:
Now we're a little bit more risky. We're more equities than most people would be probably where we are, but we know what we're doing. But if you have a balanced portfolio, you have not seen losses this year at all. And so, you've got to not panic and not time the market. Yeah, inflation is up. But when things check out, more people get vaccinated, those COVID cases come down, the supply chain issues subside, the market will do what it does. It'll return a very decent return for you to live off of in retirement over time, about 8% to 10%, which is going to keep you with inflation.

Michelle Singletary:
I look younger than I am, but if you remember in the 70s and hyperinflation and you're thinking, “We're not going to go back to those days”. The Federal Reserve does a great job of managing the economy, and I don't believe that we're going to see those double-digit inflationary periods like we had in the 70s.

Dr. Jim Dahle:
Some of us would love to see rates up. If you're more of a saver than a borrower, for sure it would be nice to make more than 0.5% on your savings these days.

Michelle Singletary:
That is absolutely right. Some savers are like, “Let’s go for inflation”. But we do want to be careful about those cheering. Obviously, I'd like more money in my basic savings account, because that's where I keep my emergency money, but I'm okay with that because that money is there to be there when I need it. So that's not growth money. It's doing its job, which is to just sit there and be there in case something happens.

Dr. Jim Dahle:
Yeah. It's the return of your principal, not so much the return on your principal.

Michelle Singletary:
That's exactly right. And you need to have those kinds of pots. I always tell people I'm a pot person. Not that kind of pot, but I have different pots for things for my money to do. Just like when you're cooking every pot that you have on a stove has a different meal in it. You've got maybe your vegetables and your meat and they all sort of do what they're supposed to do. And it's the same thing with your money.

Michelle Singletary:
I'm not fretting that my emergency money isn't earning anything because I don't really care. I just want to make sure the principal is there if something happens. If my husband loses his job, if I lose my job, we get sick, that money is there to take care of us.

Michelle Singletary:
Now I do care what my investments are doing, my retirement and my non-retirement. I pay attention to that and make sure it's invested the way I want to invest it and it's doing what it needs to do. And then I'm okay.

Dr. Jim Dahle:
Let's talk about that for a minute. What's in your investment portfolio?

Michelle Singletary:
Well, I'm going to say cautionary, I'm an equities kind of gal. And one of the reasons why is because my husband and I were extremely conservative when we first started out investing. We didn't know much. We didn’t know what we were doing. We were very scared. And so, we're trying to make up for those years where we were way too cautious.

Michelle Singletary:
Probably more than 90% of my money is in equities, but at mutual funds, low cost indexed mutual funds. I do not have individual stocks. I'm not smart enough to be sitting there looking at all those financials and trying to figure out what stock. I love low index funds and they have done well by me for my retirement plan, for my non retirement money.

Michelle Singletary:
For the kids' college funds, we put our money into 529 plans for them. And over 20 years we're able to send all three children to college with no debt and still have some leftover to send them to graduate school with no debt. We've had one go through graduate school, and she didn't have to borrow. We didn't have to borrow for her.

Michelle Singletary:
We've got another one coming behind her. He's thinking about going to grad school, and got that money set. My youngest one has a pretty good scholarship because she wants to be a teacher. All that money that we saved for her is still sitting there. And we actually might have to take a penalty because we don't need that money.

Michelle Singletary:
But typically, the average investor should have a very balanced portfolio, some stocks and bonds based on their risk tolerance. But that's what I like. I like index funds. It's easier for me to have the diversity that I need by investing that way. And I'm very cautious of costs because lots of times people don't pay attention to what their investments cost them and that money impacts directly your returns.

Dr. Jim Dahle:
Well, you're preaching to the choir here. My listeners know I'm a huge fan of index funds and the vast majority of my portfolio is made up of index funds. You say you're not smart enough to pick stocks. I would argue you're smart enough not to pick stocks.

Michelle Singletary:
Yeah. I have stocks in my portfolio. This idea that I have to pick individual stocks. Why? If I'm having the S&P 500, I've got stocks. If I'm in Russell, I've got stocks, I've got small cap, I've got midcap, I've got stocks in international companies. And so, there's a whole group of folks who get paid to manage those indexes. And could I do better with individuals perhaps? But I could also lose a lot and probably pull my hair out when I see something happening to a particular company. You have to know yourself. And I know that that's not how I want to invest.

Dr. Jim Dahle:
Let's talk about another one of your columns recently. The pandemic has been called the ‘She Session’. Why is that? And what can women do to recover from it?

Michelle Singletary:
We found obviously because of how COVID hit and the shutdowns that it adversely affected more women than men. About a quarter of the job losses were experienced by women. And also, because daycare centers and things like that were shut down. And so, the kids couldn't go and they had to either try to figure out how to work from home or quit so they could take care of their children. We still know in this society the women take care of the children.

Michelle Singletary:
And also, because so many of the jobs that were lost or impacted were in the service industry, which is predominantly employed women. And so, that's what happened. Women were hit very hard, and still are because of the pandemic.

Michelle Singletary:
Now as we try to recover, I don't think I need to tell all this crowd how important it's to get more people vaccinated, because that really is the key to getting our economy back on track.

Michelle Singletary:
If you were in a service-related industry, I think a lot of women are now thinking, “You know what? I need to have some skills that can weather a storm, or I could have skills where I could work at home”. Obviously, we still need service-related jobs. And people out in the field can't do their job at Target from home. But I think lots of women realize that they need to do some skill boosting to try to get through this COVID and on the other side, earn more money and stability for their family.

Dr. Jim Dahle:
Yeah. It was amazing how much more affected people that had to go to work. And that includes doctors. Most doctors listening to this podcast remember March and April and May of 2020, and their incomes went down 10%, 20%, 40%. And all of the sudden elective procedures were canceled. And it turns out your entire practice has elective procedures, like joint replacements. And all of a sudden, your income dries up. Meanwhile, anybody who was working online already, it's like they didn't have a hiccup at all in their income stream.

Michelle Singletary:
That's exactly right. I felt bad for my dentist because I've been with one dentist for, I don't know, was it 30 some years? And I was asking him, and I love him. He saved enough that he could cover people's salaries, even though they couldn't come into the office, but he was a week or two away from having to lay off people before things opened back up. And so, he was very smart with how he ran his practice. He had savings for the practice. So, he wasn't sort of living it large with the practice so that he could carry his staff. So, he didn't have to let them go and kudos to him for being able to do that.

Dr. Jim Dahle:
Yeah. I wonder if a lot of times employees realize things like that, what the business owner has done for them and maybe they'd ask about that sort of thing more in job interviews.

Michelle Singletary:
Yeah. Well, there's another trend called the great resignation and people are thinking, “You know what? Life is way too short”. Including people in the medical field. They're like, “You know what? I'm in the trenches. People are coming to you, some vaccinated, some not, putting your health at risk. And I did go to get this degree to be this doctor, but this is not worth my life.” And so, you see an outflux of a lot of people in the medical profession, nurses and people on the lower end of the pay scale in terms of the medical field, it's been a tough ride for them as well.

Dr. Jim Dahle:
Yeah, it sure has. I think anybody who works in a hospital right now understands just how serious the staffing concerns are and how much that resignation is people leaving the field completely, retiring early, being burned out. And how much of it is people switching jobs. It seems like a Merry Go ‘Round in my city with nurses.

Dr. Jim Dahle:
I think nursing pay has gone up about 25% this year because they're just trying to get people in the door and get them to stay there. But what's happening I think is the nurses are bounced around from hospital to hospital and just trying to get a better job and take advantage of it.

Michelle Singletary:
Yeah. And you're right about early retirement. Lots of people have been retiring early. There has been a great exodus of people in their late 50s saying “I'm done. I got to live a life”. And it's a hard job, long hours. If people have done well and have saved, invested, they can retire early.

Dr. Jim Dahle:
Yeah. I think people are riding a lot of the recent good returns we've had, over the last 10 years there have been great returns in the markets. And they go, “Well, maybe I didn't think I was going to be able to retire now, but maybe I can”.

Dr. Jim Dahle:
All right. You've had a couple other columns recently about social media, which is something that fascinates me, partly because I make a living online with social media, but just because it's been such a game changer in the world the last few years.

Dr. Jim Dahle:
But one of your columns was suggesting that people be aware of FOMO spending, you called it. Fear Of Missing Out spending. And the other one was pointing out the debt collectors can now hound you on social media.

Michelle Singletary:
That's right.

Dr. Jim Dahle:
What are your thoughts about social media? Should we all just banning it all together?

Michelle Singletary:
Back in the day, I sort of thought that I was one of the last adopters thinking, “Oh, that's this social media stuff”. But it's very helpful to people when it's done right. I'm very active on Twitter. That's sort of my platform. I really like Twitter. But getting a little bit into Instagram and TikTok, I think it can be very helpful to people. You just need to be very careful about what you put out, what you take in. Its immediate reaction to everything. So, it can be really tough.

Michelle Singletary:
Now on the side of the consumer financial protection bureau which is the Consumer Watchdog, under the Trump administration, changed the rules so that it will allow debt collectors to contact you either through text messages, emails, direct messages on your social media platforms. And that could open the door to so much because we do know that debt often is sold and resold and resold, and it's not sold with the backup information.

Michelle Singletary:
Lots of people are being contacted that don't actually owe the debt. And so, they put in a rule that says, okay, they can contact you through these other mediums because many of us, that's how we communicate now. They don't like calling us anymore and we are not answering the phone anyway, because it's just a lot of scammers. And so, people aren't picking the phone up.

Michelle Singletary:
Now the rule says that if they do contact you through social media, they can't post anything on your page or anything that will allow your friends or family, your contacts like a LinkedIn to know that they are trying to collect a debt. They have to send you a private message. And in that private message, they have to say upfront, I'm trying to collect a debt from you. They can't sort of slip into your Facebook and say, “Hey, when did we go to college back in the day?” and not say that they're debt collectors.

Michelle Singletary:
My concern with that is that we're getting so much spam and scam messages through email and text messages. And even in some of our social media platforms, I think some people will be scammed into paying a debt that they don’t own or to giving up information that could lead to a scam down the road.

Michelle Singletary:
What I'm telling people is that if you know you owe debt, and you get a text message or email or something on your social media platform, don't respond, don't click on anything. Look up that debt collector, make sure it's a legitimate company, independently Google them and then contact that company outside of that platform so that you can protect yourself.

Michelle Singletary:
Because the scammers know, they read the paper too. They're online. They know how to craft their scams and schemes to flow with the current news. You just need to be very, very careful. I don't click on anything, even if I contact my bank and I go “Okay. Let me just call you independently to make sure”.

Michelle Singletary:
Because I won a Loeb award that came with a cash prize. They sent me an email asking me to fill out a W-9. I said I don't know if this was you. I got out of the email, went to the Loeb website, contacted the person that was in email. I said, did you send me an email? He's like, yeah, that was me. That was me. And I knew that that was coming, but I don't trust anything. Nothing. I don't click on anything.

Dr. Jim Dahle:
Yeah. That's probably a good policy. Clicking on links is a good way not only to get scammed, but to download malware onto your computer. So, you got to be careful with it for sure.

Dr. Jim Dahle:
Now I want to talk about a recent series you did. This was an award-winning series titled “Sincerely Michelle”. It explained misconceptions involving race, regarding investing, credit scores, home ownership, and more. How does the experience of Black Americans differ when it comes to personal finance and investing?

Michelle Singletary:
Ooh, where do I start? This was a 10-part series, and it sort of was born out of a lot of the unrest that happened after George Floyd and then just the last couple summers. I don't talk about race a great deal in my column. Because from my perspective, money's all green. We all have to sort of deal with it.

Michelle Singletary:
But I just felt compelled to talk about what it's like to be a Black American, even at what many people would consider a successful Black American. And the things that I've had to deal with, even at my level of success, the microaggressions. I walk into a room and there's an assumption that I don't know when I'm talking about.

Michelle Singletary:
Even sometimes when I give a speech, people will come up to me and I know that they mean well, and they're saying, “Oh my gosh, wow”. But the level of enthusiasm often makes me feel “Well, what did you think?” I've been working for the Post for 30 years. I have a master's degree in business. What did you think I was going to do? And it's just the expectation that you are not going to be excellent.

Michelle Singletary:
And even at the Washington Post, when I got there, people were asking behind my back, “Well, how did she get to the Post?” I got there at a fairly young age but I also got there because I had expertise in some different areas.

Michelle Singletary:
And because I heard all the stuff going on, this was the first column I wrote in a series about affirmative action. I asked my editor at the time, “Did you hire me just because I was black?” And he said, yes.

Dr. Jim Dahle:
Wow.

Michelle Singletary:
And I just was floored. And I started to tear up and he said come into my office and he sat me down. And I'm thinking in my head all those people were right. I'm just some sort of token here. And then he said to me, “But Michelle, I hired you because you're black, because you have a unique experience. You grew up with no money. So you have a different perspective that you bring to the Washington Post business section. As we write about the economy, if we write about personal finance, you understand what it's like not to have”.

Michelle Singletary:
He said, “I hired you because you have a master's degree in business. I hired you because you're a woman. Because you grew up in inner city Baltimore. I hired you because you had, at the time, I developed an expertise in bankruptcy coverage.” And at that time there were a lot of corporate bankruptcies and no one on the staff had experience in covering bankruptcy. So, he hired me because I had been covering bankruptcies for the Baltimore Evening Sun.

Michelle Singletary:
And he just went through all of these things. And so, I said, “Why didn’t you start there? Why did you just say yes, I heard you because of that?” Because he said, I don't want you to run away from your blackness. That is an asset to the Washington Post. And there's nothing wrong with the fact that I wanted diversity on our staff, but you did not take a job from someone else more deserving. This was your job to have.

Michelle Singletary:
And so, each part of the series tried to examine a lot of myths as it relates to African Americans. We buy sneakers and all we do is we buy all these consumer goods when we should be investing. Even one pair of Jordan sneakers are $200 something dollars is not going to send your kid to college.

Michelle Singletary:
And reparations, why should Black people receive reparations? And just sort of going through the historical perspective, why we still should be talking about slavery? And I was talking to an expert, a historian, out at Duke University, but a black historian. And I talked about how I got all this pushback. Well, why you keep talking about slavery? And he said, when you talk about it in a sense of generations, it's not that long ago.

Michelle Singletary:
And that is absolutely true. I am a direct descendant of an enslaved people. My grandmother's grandfather was enslaved. And because of all of that happened to her though that she passed a lot of those things off to me, the fear of financial institutions. And why does she fear them? Because they would take your property. They would burn your town down.

Michelle Singletary:
Talking about microaggressions, when people say to me, “Oh, you speak so well.” They wouldn't say that to you, Jim. They wouldn't say “Jim, you speak so well”. They expect you to speak well, you have a podcast. You're a brilliant person. Why would you say that to me? And so, I wanted just to open a door to a conversation, which is why it's called “Sincerely Michelle.” It's a letter. I don't want to yell at you. I don't want you to feel guilty. I just want you to understand what it's like to be black in America.

Michelle Singletary:
And it's tough even for those who succeed, because then they say, “Well, you made it. Why can't other people make it?” I had a whole bunch of people helping me along the way. I had a first-time home bias program that helped me buy my first home. I got a scholarship because the Baltimore Evening Sun had been peppered with community complaints about how they covered the black community because they didn't have enough black journalists.

Michelle Singletary:
All of those things were put into place to help me succeed. I didn't do it by myself. And when you have all this going on, you just want to explain why there's so much arrest, why there's still police brutality, why there's still disparity in what I might get paid and someone with the credentials that I have is getting paid more than me because they are white man or a white woman.

Michelle Singletary:
And I just wanted to say, listen, this is still going on. This is not in the past. This is still our today. And I just felt it was really, really important. And the response was typical. Lots of emails that I couldn't even repeat on air, but then some that were just made me cry because they thought “You know what? I had never thought about it that way.” And that's why I did the series for that kind of comment where people's eyes were open that said, “I did not know that that was still going on.”

Dr. Jim Dahle:
Let's turn the page a little bit. You mentioned the response, which I wanted to ask you about, and I guess I'm not surprised to see it was mixed. But we're excited to have you out at what we call WCICON around here. It's the Physician Wellness and Financial Literacy conference.

Dr. Jim Dahle:
We are going to give away your book. You're one of our keynote speakers at the conference. We are going to be giving away your book “What To Do With Your Money When Crisis Hits” a very timely book these days. What will people learn from that book?

Michelle Singletary:
When we came over the title for the book, one of the things that concerned me was people, especially people who are doing well for themselves and said, “What do you do when a crisis hits? Oh, this isn't for me.”

Michelle Singletary:
But this pandemic has shown us that no matter where you are on the economic ladder, you could be impacted, you could lose your job. And we talked about this earlier for some doctors and their practices. It was an economic downturn. I wanted to write a book that says no matter where you are, you've got to be careful about how you spend your money and here's how.

Michelle Singletary:
A great deal of the book talks about building a legacy and lessons that I learned from my grandmother. Learning when I didn't have any money, to now that I have money, how do I spend it well? How do I make sure I'm investing well? How do I make sure that I'm not living so far above my means that no matter what my salary is, I can still be broke?

Michelle Singletary:
And so, that's what I want to talk to the audience about. And also, just making sure that you're managing and you are getting what you want out of the work that you're doing.

Michelle Singletary:
My husband and I have sort of a legacy plan. We knew that we wanted to send our children to college debt free. We wanted to give that gift to them. We have our wills and estate plan in place. My husband loves this quote from Warren Buffet. I'm not going to quote it exactly right. He always gets it better than me. But he says, “I want to leave my children enough that they do well, but not so much that they don't do anything”.

Michelle Singletary:
That's what our plan is for our children. We're going to leave them some wealth, but not so much so that they can sort of just sit back and go “I got it”. We train our children from the time they were little about managing money, not over spending.

Michelle Singletary:
It's so funny now that they're young adults in their 20s. My younger daughter came to me one day and she said we have a nice house and all that. And her friends came and they were saying, “Oh my God, you're rich”. And she said, “No, I'm not. What are you talking about?” She was like, “No concept of that. We have no money. She was like, I don't know what you're talking about. My mother doesn’t buy us anything”.

Michelle Singletary:
We were very intentional about that. They did not live up to our financial potential because we didn't want them to feel as if they were so wealthy that they didn't have to try hard. That we were going to leave them so much that it would be okay. And so, we made them work during the summer and they had to use their money to pay for themselves when they were in college.

Michelle Singletary:
We didn't do shopping as a form of entertainment. If you look in their closet, it's not a jam full of clothes. They were last to have video games or anything like that. We're a reading family.

Michelle Singletary:
I remember this one time we were in Disney. You know those long lines. And so, I just noticed that all the kids had those PlayStation whatever handheld things, just a long line of the kids on their phones. And I looked at my three children. It was one of my proudest moments. All three of them had a book in their hand and were reading in line.

Dr. Jim Dahle:
That's awesome.

Michelle Singletary:
Because we didn't get them cell phones until they were in high school. We didn't get them video games until they were in high school. They didn't have anything else, but to read and they were happy about it. They were just reading their book as we were moving in line. And I tell you, that was just such a proud moment for me. And we didn't tell them to bring out their books. We didn't even tell them to bring a book to the park. They just knew that the lines were going to be long. They didn't have any video games and they brought books to read.

Michelle Singletary:
And so, that's sort of what I want to talk to this audience about because you sometimes lose focus the more money you make. You want to create a legacy that helps other people. You want to create a legacy of giving. A great deal of our income, 10% of our gross income goes to charity. My husband and I give back to the community. We are very active in our community in terms of volunteering. My husband and I teach at prisons to teach inmates who are about to be released how to handle their money.

Michelle Singletary:
I guess maybe this is a theme of my talk as to whom much is given much is required. And you are at a part of your life where you have the financial resources, the intellectual resources and the bandwidth to give back beyond just being who you are.

Michelle Singletary:
I could just say, “I'm a syndicated columnist for the Washington Post” and be done with that. That's just the top of my field. That's not enough for me because it could be gone tomorrow. What else is going to be my legacy? I don't want my obituary, I know it sounds so morbid, but I really do think like this. I don't want to say she was a Washington Post syndicated columnist, and that's kind of it. Or I was the chief or surgeon or I was a dentist. That can't be all. It can't be, it shouldn't be.

Michelle Singletary:
It would be “I set my kids to school debt free so that if my kid doesn't want to be a doctor, maybe my kid wants to be a social worker. Maybe my kid wants to be a teacher”. But we look down on those professions, especially when you make more money, because you know they're not going to make a lot of money.

Michelle Singletary:
But when my youngest said she wanted to be the teacher, I was so happy. I was just thrilled. And you would think with me earning six figures, my husband earning six figures, a multimillionaire would be thinking “Really? A teacher?” But I thought about the people who had an impact in my life and they were always educators.

Michelle Singletary:
And the fact that my daughter wanted to do that to somebody else. And not only that, she's in special education, I'm so proud. Guess what? I had taught my child how to live off of that salary. And she is probably going to be richer than somebody's mama and daddy who's a doctor because she knows how to handle that teacher salary.

Michelle Singletary:
My other kid is a social worker. She's a social worker therapist. She's not going to make the amount of money her dad and I make, but she's going to make enough that she's already on the road to be a millionaire.

Michelle Singletary:
She's contributing 15% of her income to her retirement plan. She wants to buy her car with cash because we bought her a little used car in high school that she still has. She's had this car for 10 years and she says, “Mommy, when I get 30, I want a new car”. She wants an electric car. I said, well, for four years, you can save so you can pay cash for it. She's saving it, she's investing it. She's going to have that money.

Michelle Singletary:
That's to me what this is all about. And I think the whole conference is about financial wellness, health and financial health. And it's not just about the zeros behind that. What are you going to leave to your children, your community and the world from all of this you've been able to gain?

Michelle Singletary:
And to me, I want the headline to say that I volunteered in my community, that I sent my kids to the college debt free, that I embraced the things that they wanted to do, their calling and I didn't push them into a stem or push them to be a financial planner or something that I thought would make more money. I listened to them “What do you want to do with your life?” And then supported them in a way that they can live off of the salary that they make.

Dr. Jim Dahle:
“To whom much is given, much will be required”. Can we use that as the title for the talk?

Michelle Singletary:
You can. I love it. I was taught to think about what to use and that’s it. Because that's really what it's about. We're in a unique position, those of us who have done well for ourselves, to make a great deal of difference. And it can't just be about a bigger house, a fancier car, a world trip.

Michelle Singletary:
Now I'm not saying don't do those things. We have a beautiful home. I'm not so into cars. We don't really care about that. We take five-star vacations, but we also build into our budget as a line item, as important as our mortgage, tithing to our church. That is paramount to who we are and what we do. We built into our budget, not having our kids come out with debt and intentionally raising them in a way that they don't think that they are rich.

Dr. Jim Dahle:
It's a funny story you mentioned with your kids' friends coming over. I got to tell you I had a similar experience. My eldest friends came over to the house for the first time and they drove by for the first time. They were like “That can't be the house, even though it has the address”. We've done a renovation, now it's a very nice house. “That can't be the house because we've seen her phone and her car”.

Michelle Singletary:
That's right.

Dr. Jim Dahle:
And they had to call her and say, “Is that your house?” And they came back to the house and I was like a mission accomplished right there.

Michelle Singletary:
That's exactly right. Yeah. They don't think that way. And they are hard workers and they do not like to spend. We have to beg them to spend. My husband and I, was just a big joke like we went overboard, but it's so cool that it's not about what we have for them.

Michelle Singletary:
And one of the things I have learned in working with people, especially people who have money, oftentimes their children are not good money managers. Their children are overindulged and overprivileged, and they don't have a sense of community. And you learned how to do it.

Michelle Singletary:
You scrimped and saved and maybe even your parents scrimped and saved, but oftentimes you're not passing it on your children. Because I get it. People will say things like I want them to have it better than I did. I don't want them to struggle. That is wrong. It's bad. So bad. I want my kids to suffer and they did but it made them better human beings because my children are not entitled at all. If I ever could be immodest about something, that is something I want to be immodest about. They are not entitled at all. They want to get what they want on their own. And I just am so proud of that. And that's the legacy we can leave them.

Dr. Jim Dahle:
Our time is getting short, but I want to ask you a little more about this Prosperity Partners Ministry. Can you share an experience, an anecdote from teaching financial literacy in prisons and what that's been like?

Michelle Singletary:
Yeah. Because I was sort of rescued from foster care, I've always had this sense of giving back because so many people stepped in to save me. Even when I was in my early 20s, I had my first little dog on my own, because I've been a homeowner since I was about 21, right out of college, a year out of college. I would take my dog and visit nursing homes. It was called Pets on Wheels. Because they found that nursing home residents, they didn't necessarily respond to volunteers. But when you brought the pets in, they would just brighten up. And so, I participated in that program.

Michelle Singletary:
And from there I moved on to different other kinds of volunteer programs. And I realized I had a knack for managing money. I learned it from my grandmother. And so, I wanted to do something when I moved to the Washington DC area.

Michelle Singletary:
At my church, I created this ministry, but I also realized that you can't just have like one workshop. It doesn't work that way. It takes time for people to change behaviors. And so, I wanted to create a program in which we would meet regularly for a very long time. It's a year-long program, and every month we have a workshop which I teach.

Michelle Singletary:
It's about a two to three hour workshop about money. And you can imagine, it could be four or five hours. People are so enthralled because they are hungry for the information. And in addition to that, which is unique about our program, I thought about Alcoholics Anonymous and how they are set up. They have sponsors. They have people who kind of walk along your journey so when you fall, they're there to help you out or to cheer you on.

Michelle Singletary:
And I wanted something like that with money. And so, we have money mentors who walk along with people and help them do their budget, fuss them when they don't do their budget, fuss at them when they're overspending. That's what the ministry is. We have created a team of people. We call them senior partners who walk along and help people. They're not financial experts. They're not like bankers or anything, regular people. And the criteria are, they were in debt, they got out of debt. They weren't savers, now they're savers.

Michelle Singletary:
They help other folks. And then as a part of that, our church also encourages us to have our own sort of mission program within our ministry. One of the things, I was asked to speak at a prison. And so, I went in to teach a financial class and I just loved it. I mean, think about this population that we've just thrown away.

Michelle Singletary:
But the fact that matters is most of them are going to come out and they're not going to come out with skills to handle their money. And honestly, particularly when it comes to African Americans, a lot of them are there for selling drugs. And why did they sell drugs?

Michelle Singletary:
And I know that people want to just say, “degenerates of society”, but really a lot of times they got into drugs because they were just trying to get money, to feed their family. Like 13-year old’s feeding their eight-year-old brother or sister. And they wanted things like they saw everybody else had. They wanted nice sneakers. They wanted clothes like they saw other families have.

Michelle Singletary:
Now that's not the reason why you should do it obviously, but then they're in prison, we lock them up, we don't give them any skills. Now when they come out, it's going to be hard for them to get a job. And when they do get a job, they are going to want more stuff.

Michelle Singletary:
I really wanted to create a program to say, “Listen, you're going to have it harder. So let me teach you how to handle your money so that when you get out, first of all, you don't go back to those habits that got you in there. You don't resort to that to make money. Let's figure out how to legitimately make your money and use it in a way that can create wealth for yourself and change your legacy”.

Michelle Singletary:
My husband and I teamed up and we went inside institutions, we did before COVID, and during COVID, we held Zoom classes. And now the things are getting better, we're going to be going back into the institutions. And it's such a worthwhile thing because these are folks that we just want to forget about and they need help too. And the more we can help them do better, we can help create citizens who will be productive.

Michelle Singletary:
Because everybody's crying about the programs for them and why are we giving them money for that? Think of it selfishly, because if we train them and give them education and give them some resources, they're not going to go back to a life of crime. And that might mean they're not going to steal your car or break into your house. And that's important, right?

Dr. Jim Dahle:
Yeah, for sure, for sure. Societal benefits there, for sure. They actually have to be better at managing money because when they come out, they're going to have that felon status. It's going to be harder for them to make good money. They're going to have to be even better at managing it than the average Joe might.

Michelle Singletary:
That's exactly right. That's exactly right. And you know what? My presentations are not any different to them. I don't change anything. It's the same thing I teach to the rich people or I say people earning high incomes, because they're not rich. They just have high incomes. The same lessons.

Dr. Jim Dahle:
Yeah. We know about that around here, for sure. Speaking of which, we got to wrap this up. I promised you 45 minutes, we're pushing an hour here. But you've got the ear of 30,000 to 40,000 high income earners, mostly doctors. What else should they know that we haven't talked about already?

Michelle Singletary:
Ooh, we've covered so much. I would say you're so busy doing what you do and you've worked so hard to learn what you do. Take some time to come up with a personal financial plan for yourself. And that is more than just investments. That's more than what's the next house I'm going to get, the next Mercedes Benz, or whatever.

Michelle Singletary:
At the end of the day, you’ve earned a good income. What would you have to show for that income? And to me, that's what you should be focused on. That's the difference. Who's going to remember you when you're gone and how will they remember what you did with those vast resources that you were able to get for yourself? And that means creating a legacy and that means having a plan.

Michelle Singletary:
Do well for yourself, get the things in life that you enjoy. But also, what are you giving back? Because that's also part of being well. And oftentimes when people lose a lot of weight, they also become cheerleaders for healthy living because then they understand at a level that maybe someone who's never had a weight issue doesn't understand.

Michelle Singletary:
I think those of us who are earning good money, oftentimes we sort of think, “Well, I got mine, and they need to get theirs and they need to put themselves up on the bootstraps.” But just remember that you got there because a whole bunch of people helped you. And that's how I feel. I had a whole bunch of people help me and I want to turn around and do the same for somebody else.

Dr. Jim Dahle:
Awesome. Well, it's been great having you on here, Michelle Singletary, award-winning columnist, best-selling author, now with her newest book out “What To Do With Your Money When Crisis Hits”. You can check that out or better yet, come to WCI con 22. We'll give you a free copy. You can hear her keynote talk there. You can still register for this conference at whitecoatinvestor.com/wcicon22. Michelle, it's been wonderful to have you here. Thank you so much.

Michelle Singletary:
Thank you for having me.

Dr. Jim Dahle:
All right, that was great having Michelle here. I hope you enjoyed that interview as much as I did. She is a great person, great work that she's been doing through her ministry, through her columns, through her books. I think the quality of what she has done really exudes when you hear her speak and we're looking forward to having her at the conference as well.

Dr. Jim Dahle:
A word from our sponsor. 2021 has been a year with a long list of tax changes, and we might have additional surprises in the next few weeks. As a result, your current tax plan may not be tax efficient and may need a tune-up to make sure you're keeping more of your hard-earned money.

Dr. Jim Dahle:
Medical professionals all over the country rely on Cerebral Tax Advisors for proactive tax planning strategies for doctors, helping them lower their effective tax rate and increase their wealth through court tested and IRS approved tax strategies.

Dr. Jim Dahle:
As a spouse of a physician, the lead tax strategist, Alexis Gallati has nearly two decades of experience and high-level tax planning strategies and multi-state tax preparation. Their services are flat rate and they're focused on their client's return on investment.

Dr. Jim Dahle:
Check Alexis's book, “Advanced Tax Planning for Medical Professionals”, or if you'd like to schedule a free consultation visit their website at www.cerebraltaxadvisors.com.

Dr. Jim Dahle:
Don't forget about our sale. Go to whitecoatinvestor.teachable.com. From now through January 3rd, you can get our online courses there, bundled together with an extra course, a CFE Las Vegas course, that you get for absolutely free when you buy one of our online courses in the next week or so.

Dr. Jim Dahle:
You can obviously still come to the conference. You can register for that at whitecoatinvestor.com/wcicon22. You better hurry if you want to book a room there though, that block is filling up very rapidly. And I think we may even have to turn over any unused rooms we didn't use to the hotels soon. Whether you registered or whether you're about to register, make sure you get your room as soon as you can.

Dr. Jim Dahle:
Thanks to those of you who have left us a five-star review. Our most recent one, comes in from Sunday User. “Great podcast for entry into and continuing education in financial literacy”. We appreciate that.

Dr. Jim Dahle:
Keep your head up, your shoulders back. You've got this and we can help. We'll see you next time on the White Coat Investor podcast.

Disclaimer:
My dad, your host, Dr. Dahle, is a practicing emergency physician, blogger, author, and podcaster. He’s not a licensed accountant, attorney or financial advisor. So, this podcast is for your entertainment and information only and should not be considered official personalized financial advice.