Season 1, Episode 3: How to get rich real slow and boring-like

If you learn only one finance-y thing, let it be compounding interest

The "Let's learn about finance and investing!" party is still going over here at Women on the Verge of a Financial Breakthrough!

This time, Caitlin and Sara talk about what the hell people are talking about when they tell us to "save" money, how starting small is totally awesome, as long as you're starting at all.

Also, Sara gets out her (imaginary) megaphone to tell Women on the Verge that COMPOUNDING INTEREST is the MOST IMPORTANT concept you need to understand about building your financial future. You're welcome.

Don't forget - at the end they share the one thing Women on the Verge of a Financial Breakthrough can do TODAY to take the first, or next, step towards building a strong financial future.

Ask us your dumb investing and finance questions on our contact page!

This episode was edited by Kim Shelton and Kelly West. Music by Bad Bad Hats and Devmo.

Transcripts for Episode 3: How to get rich real slow and boring-like

Music intro by Bad Bad Hats

Caitlin [00:00:06] Welcome to women on the verge of a financial breakthrough, the podcast where we're going to figure out finance one dumb question at a time. I'm Caitlin Meredith. I'm a mediator and a coach based in the Bay Area, and

Sara [00:00:20] I'm Sara Glakas. I'm an investor, advisor and founder of Black Barn Financial and the Austin Women's Investing Group, which can be found on Meetup.

Caitlin [00:00:30] And she's the expert that I ask the dumb questions to.

Music transition by Bad Bad Hats

Caitlin So are you ready for some more dumb questions?

Sara [00:00:42] Yes, I'm ready. I can't wait to hear them. I hope they're so dumb.

Caitlin [00:00:46] They're super dumb. What is the difference between savings and investments? When someone says you should have this much in savings, I always think they mean in a savings account. And sometimes I feel like people are actually saying that that money should be in the stock like you're saving money for retirement, which would mean it would be in investments, not in a savings account.

Sara [00:01:15] Yeah, that's a good question. I think context probably matters because I think people do use those terms interchangeably, and I think I'm probably guilty of this as well. So I'll tell you what I think. And then you can see if that's a good answer or not. So when I'm thinking about investing, that is the process of turning the money you've saved, right? You earn some money, you pay for some stuff and then there's some money left over right. That is your savings. And I think of that as cash and you turn that into investments. You use your savings to buy investments. So the savings piece is important because you need to know at the end of every month or the end of every year how much you can save. And then it's up to you as the investor to figure out where you put the savings. Do you put it into a savings account or a checking account, which is cash? Or do you turn it into a mutual fund with stocks in it or bonds or something like that? And you turn it into what I think most people would think of as an investment, whereas investment accounts? But I think they do get used interchangeably. It probably depends on the context how much money do you have in savings? I would take that to mean, how much money do you have in a savings account? How much money do you have in cash? OK, but when I'm talking to someone and doing like doing a financial plan for someone, you know, one of my questions is, Well, how much do you save each month? In my mind, it's like the amount available to turn into investing if you make that choice.

Caitlin [00:02:58] OK, so it's the money you are earning, but not spending correct in that category. And I'm assuming in a financial plan some of that should go into a savings account. So it's available to you, your emergency fund, whatever fix the car. The other part of that unspent salary needs to go in investments, which is also called retirement savings.

Sara [00:03:27] Yes, I mean, I think again, that's a point. Like if someone's talking about this, you would want them to clarify because not all investing is for retirement. I mean, that's kind of the the easiest thing to think about. I earn money. I save some money. Some of that saved money goes into a savings account for an emergency. Some goes into a retirement account for retirement, and it's called a retirement account. But there's lots of people who invest outside of retirement accounts. So I think limiting it to retirement accounts is a little bit. The vocabulary is a little bit limiting. I try to use the phrase investment accounts and investment accounts encompasses both long term retirement accounts and shorter term, maybe college savings accounts or just some brokerage account that you have because you don't know what you're going to use the money for yet, but you still want to be investing it, you know, putting it at risk with the expectation for a higher rate of return than you would get in a real, legitimate savings account. But there's all kind of fall under the realm of investment accounts.

Caitlin [00:04:33] OK. So when I first started your class investing for beginners those many years ago, I didn't think I was investing because I didn't know what investing was. And then, through your class, realized that because I had a 401k from a very old job, I already was investing in that. In fact, having a 401k, or I think I had a 403 b what it non-profits,

Sara [00:05:08] probably a 403b

Caitlin [00:05:09] 403b. I had been investing and I find it difficult to understand why I wouldn't have made that connection. It was like they were two completely separate things and investing would have been for a rich person. Yeah, and a retirement account is just what you got with a job that meant you'd get some money later. But I did not connect the two. I would like to believe I'm not the only person.

Sara [00:05:37] No, that happens all the time. The other thing I hear that's in a similar category is people will say to me, Well, I don't invest in stocks. But then they'll show me their 401k that has 60 percent in a stock mutual fund. And I'm like, These are stocks. You're investing in those stocks through your 401K. But what they're trying to tell me, and I only know this after doing some research. What they're trying to tell me is I don't buy individual stocks that somehow like in their brain. They're differentiating between buying shares of individual stocks and buying shares of a mutual fund that invests in stocks. And so people, you know, they put their money in all sorts of different categories, according to the mind map that's in their brain. And that makes it difficult for us to talk to each other about it, right? Because my mind map is different from your mind map when it comes to a person. And we're just trying to figure out like how to connect it. And, you know, luckily, I get to see people's mind maps every day because I ask them to submit their financial documents or like a spreadsheet they've put together, or do they use Mint.com or personal capital or something like that. And so I can see how they've categorized things, and then I can move everything around into my own categories so that when I'm talking about it, I know what I'm talking about. But there's almost always, you know, just the subcategories that people put things in. It's kind of fascinating, like all the different buckets that people come up with in order to, you know, make their money map, work for them.

Caitlin [00:07:12] Well, and I feel like this all comes back to not having a shared vocabulary. You're either in the club or you're out of it is what it feels like. And if you're out of it, you've had to kind of cobble together your own understandings based on just like whatever random newspaper article you've read. But mainly I avoided all that stuff. But yeah. So you don't know even what you have, what you're already doing. And that's that's very confusing to write

Sara [00:07:42] because it's also like Russian Dolls. You know, you have your 401k and inside your 401k, you have mutual funds and those mutual funds invest in stocks. And so you can look inside the mutual fund and see what stocks the mutual fund invests in. So you have to keep or you can keep, you know, opening the portfolio and opening the accounts and opening them into smaller and smaller pieces. And how those all fit together is very confusing for people who aren't used to the vocabulary and aren't used to taking a deeper dove into what they have.

Caitlin [00:08:18] Well, it's really comforting to know that I'm not the only person out there that really did not get, and I just want. I think there's something about the people that we see in movies and TV that have investment accounts that can say the word brokerage or my broker. Those are people in TV that are men in polo shirts, you know, that make a lot of money. And so it's not a sort of universal concept that we I would also be doing something the exact same as they are, right?

Sara [00:08:54] I mean, and we should all be having more and more conversations in whatever our understanding of the language is so that you can get more used to the vocabulary and more used to the language and you can become more fluent. Most people will never become fluent, so there will always be that, you know, finance as a second language, something that comes up where it's like, Oh, she she said this, but she meant that now I understand what she's trying to tell me. But I mean, I'm this way with learning languages like embarrassed to, you know, speak in a foreign language to someone else because I'm afraid I'll look dumb like that is a huge barrier in finance. Like, you don't even try to ask the questions like you are asking them right now. And I think I don't know, like people like me, like people who are kind of do this professionally, we need to be more accommodating. We need to be more open to taking the time to understand what people are trying to tell us because it's I don't know, it's really important. It's also good for us to hear how other people think of finance, right?

Caitlin [00:10:01] Well, I think your language analogy is right on. Like when you learn enough to ask someone directions and then they turn around and tell you those directions in their language, you're like, Oh shit,

Sara [00:10:15] I know

Caitlin [00:10:18] I know how to put together my one question. And so that shuts you up. You sort of, you know, your your fingers get burned on that first one and you can't even ask a follow up because you have that overwhelming experience of asking the question, getting an answer and actually feeling even more confused. And so a follow up. You have nothing to dig into and exactly that feeling of asking a simple question in a foreign language and getting a full answer, which probably completely answers that, but that you are totally in equipped to absorb, process, analyze or just understand what the freaking words are. Yes. So you're right, and that's one thing that has been so great about us women's investing group and being asked to ask the dumb questions because I think I would have never even articulated the assumptions I was making, except for taking that class where I had to know things. And, you know, any class with a one on one on it encourages people to start from the beginning. Yes. OK, so let's talk about compounding interest. So I'm going to give you my understanding. This is like a game of telephone. You taught me what compounding interest is now. I'm going to tell it back to you. I'm so excited. You're so excited. OK, well, I'll tell you what my take-home message is from compounding. I'll work backwards. My take home message from understanding compounding interest is the longer you're in the stock market, the more money you make, which seems self-evident. But when I say more money, it's like orders of magnitude more. The longer you're in it. So it's not the same as saying the longer you work at your job, the more money you make. Because you'll get a promotion every once in a while and with seniority, you'll get bonuses. Whatever I'm talking, if you start at the beginning of your working life, the riches you can amass by your retirement are beyond what most of us would have imagined. And so that means that the money, whatever money you put in earlier, will always turn into much more money than if you start putting in a lot money later in your life.

Sara [00:12:48] Tonight, I think that's pretty good.

Caitlin [00:12:50] It's so hard to do it without the math example. So compounding interest is using your lifetime to increase your wealth. That's stronger than the amount of money you actually put in it. So your years are worth more than your dollars, essentially. So starting out as early as you can means you'll be richer at the end than even if you can put in twice that amount later in your life.

Sara [00:13:24] Yes. And so to drill down on that. I'll just add on to that the way that I think about compounding using that as a jumping off point. Now compounding is the idea that the money you earn earns its own money in the future. Okay. And so there's all these mathematical formulas that we use to describe that exponential growth. But another way to think about it, where you don't have to think about exponential growth, necessarily something that's a little bit more intuitive to me is thinking about compounding as how many times can you double your money? So going back to what you said about age and youth, if you're starting at 25 and you're ending at 65, you have 40 years of compounding. Mm-Hmm. If we expect an investment, let's say a stock to double every 10 years, you have four rounds of doubling. Okay, so one dollar invested turns into two turns into four turns into eight, right? If you start later and you only have 20 years of compounding, you go through that doubling cycle only twice. One dollar turns into two dollars turns into three dollars. OK, I think I missed a compounding cycle for the younger person, but it ends up being like, How many times can I double my money before I die? Right? I get that. We are. We're bound by our life span. So that becomes important and maybe a nicer way to say it. How many times can I double my money before I need to start working that whole thing in reverse and start using this wealth that I've accumulated to live off of and have a secure end of life? Whatever the timing on that looks like.

Caitlin [00:15:16] There's another part of it. I feel like that is not intuitive, but that's super important, which is you can't compensate for the time you lost almost with any amount of money. I mean, if you're super wealthy, it doesn't really matter. But you can't compensate for those 20 missed years by just saying, Well, I'll start by investing more money now because of missing those doubling cycles. It's crazy because, you know, when I was young, I didn't have money, but I had time. And that would have actually made me. The time was the key there, not the money. Yes. And later in life, you need to have a lot of the money to compensate for the lack of time to make it even.

Sara [00:16:04] Absolutely. And that's what traps people who don't start until late, whatever that is relative to, you know, how long you have left to go. Starting later means just because of the way the math works. If you start later and you're trying to get to the same end point, you have to save way more money, which means you need to earn more money and or spend less money in order to have that much larger amount to save and put away. And so that turns into an example. You know, someone has, you know, worked their whole life. You know, they put all their kids through college and then they turn 50 and they come in and they say, OK, now I'm ready to start saving for retirement. Yeah. The amount of money you need to save from age 50 to age 65 can be huge. You're trying to, you know, let's say you're trying to get to a million dollars. That savings amount can be such a large number that people get discouraged and they just give up. And that's when people say, like, OK, I'm and I have to work longer than expected, or I'm going to have to invest in the types of things that I wouldn't normally invest in because I need a higher rate of return in order to make this math work

Caitlin [00:17:25] to compensate for all those years lost. Exactly. Can we do our examples? Sure, right. OK, I'm going to give you three examples of women at different stages of their life, and we'll go through the math so we can demonstrate this, OK? Our first young woman is Lucy. She's 25 years old. She just graduated college and she's starting her first job. Now she's barely making more than her living expenses. So this is a first job at is not more. Let's say, she says, OK, I can put twenty five dollars a month, which would be like three hundred a year. I can put that in my retirement account. And she works until sixty five. Let's say nothing else changes. She just does that. She should put more in as she goes along. But just for the purpose of this example, she does 300 dollars a year from age 25 to 65 when she retires. How much will she have in that account when she retires at 65?

Sara [00:18:25] Yeah, so Lucy here. So we would use a financial calculator or an Excel spreadsheet or a Google future value calculator to do these examples. But in this example, if Lucy has 40 years and she's putting in $300 a year every year for those 40 years, and let's just assume she gets an eight percent rate of return. So she's investing pretty aggressively. She's in the stock market and it's growing at an average of eight percent per year. Then, at age 65, just at $300 per year will turn into seventy seven thousand seven hundred and sixteen dollars.

Caitlin [00:19:01] Will you do math for me? Just figure out what's $300 times 40. So what was the actual amount she put into it?

Sara [00:19:10] Yeah, that's an awesome question.

Caitlin [00:19:11] $12000 she put in 12000 over 40 years, and what she's getting out on the other end is 78 correct? Yes, OK. So that's amazing. But in theory, she would be putting in more. So she started out at 25 per month, but then she starts making more money. And so that number should go up, so rise for the purpose of example. Now let's take. Kesha, who is 40 years old and she's been freelance in her career, and so she just never felt like she had enough money to do her retirement account, she never had to do one for a job. But at 40, she's had her first kid and she feels like, OK, I kind of freaked out. Like, now people I know are talking about retirement. So she says, I can afford now $50 a month into my retirement account. So that is six hundred a year. So twice what Lucy was putting in. Who's 15 years younger? How much will Kesha have when she retires at 65?

Sara [00:20:14] OK, so Kesha has 25 years of compounding in front of her. Let's also assume an eight percent annual rate of return pay $600 per year. That's what you told me. Right? So when she starts that plan in motion, if she contributes $600 a year for twenty five years and gets an average eight percent rate of return, she will end up with forty three thousand eight hundred sixty three dollars.

Caitlin [00:20:41] So half as much. And how much did she put in her cash? So six hundred times. Twenty five,

Sara [00:20:49] six hundred dollars times twenty five? Yeah. Fifteen thousand.

Caitlin [00:20:54] She put in fifteen thousand and gets forty three thousand out. Yes. Whereas Lucy put in 12000 and got almost 80000 out. Yes. OK, now let's talk to our sixty year old woman, Camila, who's divorcing, and both she and her husband were shift workers, or he got his retirement account. She raised the kids. He took the retirement account. She got it. Not a great. She got the house. Instead of the retirement account or something, she decides she's going to start putting $100 a month. And what would she get? She only has five years for that theoretical retirement point at 65, but she's putting in twice what Keesha did and four times what Lucy did.

Sara [00:21:42] So over those five years, again, assuming an eight percent rate of return and now over five years, that would be reasonable, but not you would need good luck. But assuming the eight percent rate of return, five years of compounding, putting in $1200 per year for five years, she would end up with seven thousand and forty dollars.

Caitlin [00:22:04] That's that's terrifying.

Sara [00:22:07] I know it's so hard.

Caitlin [00:22:09] It is really hard, and it's the kind of thing that, of course, we don't want to talk about to scare people, you know, to encourage people to say, I love it. When you always say the best, you know, people are always asking you, like, should I do this system or that system and start investing and you say whatever system you will do that starts today, do it because the time factor is what you can't. You can figure out exactly your ratios and how you all do that later, but you can't do anything to compensate for the time that you're losing by not being in the market, right? OK. Anything else you want to say about compounding interest?

Sara [00:22:50] I think the concepts of compounding are the most important thing for pretty much anyone to learn, but certainly women like you don't have to know the math. You don't have to memorize the formulas. You don't have to take finance one to one. But you do need to have an appreciation for the power of compounding because that is the underpinning of everything anyone is talking about when they're talking about investing.

Caitlin [00:23:15] What I love when you talk about compounding, I love it when you talk to me about my spare whisper sweet compounding in my ear is that I feel an enormous loss for that money that I that cash money I put from tips in a shoe box to spend on, you know, whatever. When I was 20 that I could have very easily put it in this account that I did it, but I have a daughter. And so she will have no choice but to start as early as possible to put that bare minimum in. And so all get to see over her lifetime, you know, in my lifetime how that works for her. And I think that's just this other part is not just for ourselves, but what we can pass on to younger women and people that we know who don't think of themselves as any of this applying to them as it does and we can be the ones that intervene and say, Yup, this is how you open this account. $15 a year or not a year. Let's hope for a month, whatever will make a huge difference in their lifetime. So even for those of us that feel little, we caught on a little late. There's pride in being able to pass it on to the younger generation.

Sara [00:24:41] Yes, and that makes those calculations on your calculator really exciting and interesting and illuminating. Oh my gosh, what if you start thinking intergenerationally? So not a requirement. You can just run it over your own expected lifetime. But when you start thinking like, OK, like what could the power of this be over generations and generations? I mean, spoiler alert, that's what rich people do, right? You don't think about just your generation, you think about the following generation, and you start doing intergenerational planning and run these calculations out for decades and decades and decades. That's how vast family fortunes are made because the whole machine is set up to take advantage of compounding over decades. And once it gets going, it's a flywheel and it's really hard to stop. I mean, Warren Buffett, you know, he started this flywheel at age 14, and now he's 90. I mean, I would assume that he is still compounding money on top of such vast sums that he can't give it away fast enough. Right. 

Caitlin [00:25:44] So that's why you hear about people that are heirs to a family fortune for a company that doesn't even exist anymore or that made a big thing in the 40s, but isn't even available anymore. It's because of this compounding. Yeah.

Sara [00:26:00] If the generations stick with it

Caitlin [00:26:02] and that money is just making more money, even though no new money might be put in the system,

Sara [00:26:09] right, they don't have to be investing it in the original business. They're probably investing it in the other businesses that are available to invest in in the world. But the concept is the same. How fast do we expect this money to double over a period of 10 years? And that's just how you're generating a high rate of return on top of a high base amount? And it just I mean, that's what compounding is, and it's also how it can get out of control. Right. But you can start using at least that concept right for yourself in some capacity.

Caitlin [00:26:43] Yeah. But also when you think about the rich, get richer and the poor get poorer. This is also just like whoever's plugged into that versus who isn't. Yes, and there's no possibility of compensating for not being in it. If you have that machine that is making you this vast quantity of money. And I think the other thing that surprises me about it is that it's relatively or can be passive. You know, we're talking about Lucy investing twenty five dollars a month. She's just putting it in a retirement account that has a mixture of stocks and bonds, and she's just leaving it there. It's not like she's actively making all of these like really wise money decisions all the time and has to really understand the whole thing. All she's literally doing is setting up an auto transfer, and that will build her the money. I think for me, I think of those super wealthy is that that's kind of their job is to be thinking about it and strategizing all the time. So it's like a lifestyle decision for me. I'm not going to spend my time doing that. And therefore I. The secret is that it can be pretty passive if you set up a system, right? 

Sara [00:27:56] I mean, that's what your 401k is. It's that system. So you have to make two choices. You have to make the choice to not spend the money, and you have to make the choice to log into your account and choose what you are investing in. And you basically can choose high risk, high return or low risk, low return. And if you are able to get closer and closer to the high risk, high return side, where you have a chance to get an eight or nine or 10 percent average annual rate of return, if you can get yourself to that side of the spectrum, that's how this calculation works. If you aren't, if you can save the money, but it sits in your savings account or it sits in a money market account in your 401K and you're earning one percent per year, it's basically going to take you 70 years to double your money so you better save a lot of money or you're not going to have enough.

Caitlin [00:28:51] So that's crazy. Like it or not, the way that the system we have is that two people making $50000 a year. One person screams and saves and saves $20000 a year and puts it in their savings account. And so they have like $500000 in their savings account down the line compared to someone they work with who just puts five thousand and the only saves five thousand, but puts it in the market will actually have a lot more to retire with. It's so counterintuitive to like what a good person does with savings and how smart you are with money. It really is for me,

Sara [00:29:27] and it's a counter to most of the advice that you hear right? Or the money lessons that you probably learned as a child or learned as an adult, which is, you know, you do the right thing. You don't have any debt. You save money and you don't take too much risk because you don't want to get burned. But there's more to the story, right? I think that's what this podcast is for is exploring the other parts of the story where maybe those words aren't as wise as we were led to believe.

Caitlin [00:29:55] Yes, and we're going to unpack a lot of those later.

Music transition by Bad Bad Hats

Caitlin Sara, can you tell me one step a woman on the verge of a financial breakthrough could take today to take a good look and start the kind of future financial planning maybe she's never done before or has done before, but got out of it, or just needs a couple of reminders to keep that sort of financial health future focus.

Sara [00:30:28] So I think that one really easy thing that every woman can do is once a year, go to AnnualCreditReport.com and double check to make sure this is the one that's sponsored by the U.S. government. And you can get a free credit report from all three national credit reporting agencies. So that's Equifax, Experian and TransUnion. These are the credit reporting agencies that keep, you know, they calculate your credit scores that keep your credit report. And here's why. So yes, the easiest way to explain why you should do this is you want to make sure that someone isn't stealing your identity and taking out debt or taking out credit cards in your name. So you do want to prevent identity theft and fraud, that is very good. But for women on the verge, you want to make sure that your credit score is in the best condition possible because you're going to use that credit score in order to get healthy types of debt or to refinance the unhealthy debt that you have. And all of that depends on your credit score. Well, I should say not all of it. A lot of it depends on your credit score, and a lot of it depends on your income. But having a healthy credit score and knowing generally what your score is and whether it's, you know, mediocre or good or excellent will allow you to start using debt in a really healthy way. And so this is just an easy thing to do to mark your calendar once a year. Go and check your credit report. Make sure that things are looking good. You're paying all of your bills on time and keeping track of that because your credit score isn't there as like a trophy that you put in a trophy case and you're always trying to make your credit score look better and better and better. You are eventually going to use this credit score in order to improve your finances. So just make sure it's in good shape because we're going to come back and we're going to talk about in future episodes, how to use your credit score in order to make good financial decisions.

Caitlin [00:32:35] OK, but tell me this. I know people are worried. I've never been worried because I don't do it. I will today, if your credit gets checked too much, that it looks bad on it now.

Sara [00:32:47] So this is checking your credit report. If you apply for credit over and over again, it will affect your credit score. But this is checking your credit report. You're not asking for a new credit card. You're not asking for a loan, you're not inquiring about anything. You are just checking the information that these three companies have on file about you. So it will not affect your credit report or your credit score to check

Caitlin [00:33:14] to check it. OK.

Sara [00:33:16] Because once you know why it's bad, what is showing up on your credit report, you can start fixing those things.

Caitlin [00:33:25] Oh, they have bad credit. Why should they have to look at it if they just already know it's going to be bad?

Sara [00:33:32] Because when you look at what is showing up on your credit report, you can start fixing it. So if you are behind on your payments, that will show up on your credit report. All you have to do is start making your payments on time, and those little red boxes will turn to green boxes. And so we're trying to turn that from not paying on time to paying on time for some length of time. And a lot of people think that they need to make all of their payments on time for seven years or five years or three years to make a difference. I mean, a lot of what I've heard is it's 12 months, 12 months of making your payments on time in order to have a significant bump to your credit score. So that's seeing am I making the payments? Do I have too high of a balance on one or two of my credit cards? If you reduce the balance on your cards and you can start taking classes or, you know, looking at YouTube videos or something on how to improve your credit score, there's this whole game to improving your credit score. Like, OK, maybe you don't want to pay off the entire balance on one card if you want to pay it down to 30 percent and then work on the other card. OK. But once you know what you're starting with, then you can start making these changes in order to improve your financial picture. And I think that your credit score is the highest impact way to do that. Once you have a good credit score, you can borrow money cheaper. You can think about buying a house if you don't own one. You can think about refinancing your student loans at lower rates. You can think about refinancing your car at a lower rate. All of these, like magical things, start happening when you're able to borrow money for cheaper and you will be able to borrow money for cheaper with a better credit score

Caitlin [00:35:23] in the first step is knowing what it is. It reminds me I used to be a bank and hiking tour guide in Europe and one of my co guides and friends. Catherine always said Information is ammunition. I love that the good, bad and ugly to play on these trips and carry them out. And it reminds me of that. That information, even if it's bad, is ammunition because you know what the next steps are, no matter what the result is. And also knowing a it might not be as bad as you think it is. And if it is as bad or worse, you have a place to improve upon like you have a benchmark. This is where I was when I started this journey and knowing it maybe is a bigger step for some people than others, and it really counts them.

Caitlin [00:36:36] Sara, I feel like a bunch of people are going to be worried about figuring out their own time value of money calculation. What are we going to do?

Sara [00:36:46] Don't worry. We're going to find some way to walk people through the calculations so that they can do them on their own or alongside us. And so they can feel really comfortable with how to think about time, value of money and how to do the calculations for themselves,

Caitlin [00:37:02] because that's really how you get to the number of both. How much money do I need to retire and how do I get there from here? Right?

Sara [00:37:12] Yes, the calculations will give you the information that you need to answer almost all of the financial questions that you probably have.

Caitlin [00:37:19] Oh my god. It's no secret formula. We're going to unpack secret formula.

Sara [00:37:25] I'm going to tell you how to unlock the mysteries

Caitlin [00:37:29] stage of investing and can't wait. OK, see you next time.

Music transition by Bad Bad Hats

Sara Hey, do you have any dumb questions about finance or investing? Send them to us at our website. Women on the Verge.com.

Caitlin Hey, so many thank yous to Kim Shelton, our audio editor. Kelly West, who not only took the amazing photos for her album art, but helped with website design and music and mental health. Emily Kleinsorge, our stylist that did our hair and makeup for our photos from Lucy's Skyrocket. Lauren Gross and Taylor Gross, who helped us with our graphic design and

Sara Our music is by Bad, Bad Hats and Devmo.

Caitlin If your partner is making you ask for money, giving you an allowance, taking your money or not letting you know about or have access to family income, this could be economic abuse.

Sara Learn more at thehotline.org or call one 800 799 safe. 

Caitlin So Sara Because you're a financial professional, we have to read a disclaimer for this podcast.

Sara I would actually really love it if you could read the disclaimer and your best legal voice. Oh my

Caitlin God, the legal voice. OK, doing it. This podcast contains general information that is not suitable for everyone. The information contained herein should not be construed as personalized investment advice. Past performance is no guarantee of future results. There is no guarantee that the views and opinions expressed in this podcast will come to pass. Investing in the stock market involves gains and losses and may not be suitable for all investors. Information presented herein is subject to change without notice and should not be considered as a solicitation to buy or sell any security.

Music outro by Devmo