Season 2, Episode 11: WTF Is Wealth?

Champagne and caviar or just knowing you’ll be able to pay for a movie in your retirement: what it really mean to be building wealth

The movies tell us one story about wealth and it looks a lot like white men playing golf and drinking single malt whiskey. But is that what we’re trying to build for our futures??? No thank you.

So, what’s a more inclusive vision of wealth, and how do we find our own definition? Could wealth actually mean something that’s achievable for a normal person?

Caitlin asks Sara what it is we’re actually talking about when we talk about wealth, and finds out, yet again everything about money is complicated - even our fantasies.

Oh! And do you have a passive income story? A success? A failure? Tell us about it in a voice memo and e-mail it to: womenonthevergepodcast@gmail.com

Ask us your dumb investing and finance questions for Season 2 on our Ask Us page!

This episode was edited by our co-producer Kelly West. Music by Bad Bad Hats and Devmo.

Transcript for Season 2, Episode 11: WTF Is Wealth?

Caitlin Welcome to Women on the Verge of a Financial Breakthrough, a podcast where we're figuring out finance. One dumb question at a time. I'm the dummy. Caitlin Meredith, a coach and mediator based in the Bay Area.

Sara And 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 and Facebook.

Caitlin Before we start, do you know a woman who might be on the verge of a financial breakthrough? Will you text her a link to our show and maybe to other friends while you're at it? Also, please, if you can leave us a review. This helps other women on the verge find us and we read them and they make us happy cry.

Caitlin Okay. Sara, are you ready for my question today?

Sara I don't know. I don't know. I don't. I don't know what to expect. Pull it together.

Caitlin So I've been thinking a lot about the difference between personal finance and building wealth. And I think I get confused about those two things. Like if they mean the same thing and if they mean different things. Personal finance, to me is like how I manage my daily budget, what my grocery spending should be, what my overall goals, how much should be in my savings account. Like this very sort of tangible my day to day life or even out like four years, five years, I'm saving for a car, whatever, personal finance. But I feel like you've talked about something in previous episodes and just in our conversations about building wealth and that seems like a really different thing that what I'm usually preoccupied about, like, Oh, how? Well, if I go on this trip, then we want to go out for dinner. Like really short term or medium term things, or like in our episode about saving for college, like it's a big thing, but I realize I don't really know what building wealth means. Does it mean something different to everybody? Is being wealthy not worrying about money every day? Like when you think about building wealth for your clients, what are what does that mean to you? Is that leaving money for the next generation? Is it? Having $1,000,000 in your bank account. Like what is wealth in this? When you think about it, when you talk about it with your clients.

Sara Oh, okay. That's a that's a good question. Okay. So I would say that when I'm thinking about personal finance, which I do kind of put that that kind of financial planning aspect of how do we run our day to day? How do we make sure we're not spending more than we're making all that good stuff? I tend to think that a lot of those decisions comes down or it comes down to arithmetic. Right. Like adding and subtracting.

Caitlin Right.

Sara Which everybody can do. Right. We can add and subtract. I think that the building wealth part of it is where multiplication comes in. Right. Like, instead of just being focused on the dollars in dollars out, now we're trying to take the money that's left over after we've done the addition and subtraction and we're trying to multiply it over time. So I think for me, it's that multiplication aspect that is what builds wealth because that multiplying of your. Savings through choosing investments that multiply at a certain rate. That's what the wealth building is, because it's happening in the background. It's happening on its own over time based on what you're investing in. So that's how the wealth is growing. Kind of regardless of what the addition and subtraction, part of that part that's going on in your day to day personal finance life, does that make sense?

Caitlin It does. Of course, they're connected because how much you have left over to put into the money making money multiplication table is directly correlated to how much you have in your day to day life to put aside.

Sara For sure. Like there is a very, very important connection, right? Like, it doesn't matter how many times you multiply zero, like you can multiply it 20 times and it doesn't matter. It's still zero.

Caitlin I guess I. Yes. Which is a situation many of us find ourselves in. Like. Yes, all that sounds amazing, but like, look, I need dental work. And so that has to be the priority. I think I get caught up in like retirement savings and retirement savings just seems like a projection of personal finance. Finding a projection of.

Speaker 3 A projection. Can't say this.

Caitlin A projection of personal finance. But in 40 years or whenever we retire, like, how will I afford name brand toothpaste? How will I do all these, like, personal finance decisions later on? So it's carrying on, like when I no longer have a professional income, will there be money? But that feels like a very different thing than building wealth. That's just like a practical I'll I'll still need a budget then. And when you say building wealth, it sort of feels like there's like Beyoncé is coming down on a golden cloud.

Speaker 3 You know, like, well, that you're not thinking about whether or not you can.

Caitlin Afford to go out to eat three times a week or five. Wealth indicates not just all comfortably retire, it's wealth.

Sara No, I mean, wealth is how people are going to comfortably retire. You need to go back to the building wealth and the multiply the multiplication part of it. Like if you want to be able to afford the toothpaste in the future. You have to be invested in something that is going to exceed the the rate of inflation. Right. So you need something that is growing faster than the rate of inflation. That real growth in wealth that we expect to get from the stock market or real estate or whatever we're investing in. That is that multiplication effect. Your deferring some of your income today so that it's going to become income in the future. But it also has to it could become more than one year's worth of income in the future if you invest it in something that grows wealth faster.

Caitlin So wealth in this wealth quality, like a healthy retirement savings account, qualifies as wealth. If it That means that when you stop working, you still have the money that will be injected and your yearly budget to live the life that you want to live. That is among the definitions of wealth. Guess when you first described compounding interest? The first time I had really contemplated that and talked about it as like the flywheel that wealthy families, the people that invented the railroad, I don't know, or the first families of American corporations that are have generations of wealth. I'm sure the Rockefellers would qualify for this. It seems like a different kind of wealth than wealth that is for different generations. It goes beyond whatever I do in Florida in my eighties. It's what my daughter and my grandchildren will have access to because of investment decisions I made.

Sara Yeah. Generational wealth. Absolutely. Some people are you know, some people are concerned with covering the expenses of the day today or the day to day jobs, which I think we all we all know people who are in that situation or who go in and out of that situation. And then there are some people who have the day to day covered. And so they're able to set some aside in order to take care of their future selves when they don't have income anymore. And then kind of the next level is. Okay, well, now I'm setting my sights beyond my lifetime. And certainly, you know, I think that there are there's a level of wealth where it falls into the category of you couldn't spend all this if you tried. Right. It's like escape velocity. Wealth. Right. Like, whatever that is, we probably all have a number where if we had that much wealth, we couldn't spend it all if we tried. Right. Right. But that's going to be different for everybody. I mean, I think of this idea of like, especially when we talk about building wealth, it's. It's being able to look forward far enough and make decisions for something that's that's way off in the future. And it gives you a level of safety and security in some way for your future self or your children or grandchildren or whatever, whatever you're looking, whatever you're you're seeing when you look out into the future.

Caitlin It's for me, it's a new understanding of wealth. And I like it because it's a lot more inclusive, because it means like a government worker who's been really good about putting 10% in there for anyone care, whatever government workers like, they have wealth in a way that we don't think of, like, Oh, that's a really wealthy person. Like it's a more inclusive definition of what wealth means. And I think I understood wealth before to be a family money, be money you didn't make yourself necessarily or know, like obviously Bezos or somebody like that, like he's in theory, made his own, like he worked to create a company that then made him a lot of money. And C is like the ginormous Olympic sized swimming pool of cash. Like what you're saying couldn't spend it in a lifetime is so beyond personal finance decisions. It's not because they didn't go to Starbucks like that was not the reason why they got wealth. And it allowed me to think of like building wealth as like on such a different level. That had nothing to do with any decisions I'm making. Like, I'm just trying to make it through the day, make it through this week, make it through this month, the next year, and maybe make it. I'll go to the college and.

Speaker 3 Earn money to.

Caitlin Take care of me later.

Speaker 3 Well, all of this really is sort of like tangible, even domestic imagination.

Caitlin And so I like instead to replace that with like the slow and the steady are building wealth and maybe it'll go a generation beyond them and maybe not. But that's still important wealth. I just don't think it still again how much like Daddy Warbucks and Annie like the people I have in my head that are like, yeah, wealthy.

Sara Yeah.

Caitlin I it's just funny to realize I didn't even know what wealth really meant. And I was listening to an older episode that you said, like building wealth. And I was like, I don't even know what she's talking about. Like, is she next level? Are we like, is this retirement scheme just like this piddly little stuff? But the real thing is building wealth.

Sara I mean, so what's a good definition? I mean, maybe it's maybe it's just like money that you don't need right now. That would be. Wealth that you are hopefully building over time, like getting to a point where you have you have money, you have wealth that you don't need right now, that you are specifically putting it, earmarking it for the future. I mean, because then it doesn't matter what tax bracket you're in or what the number actually is. I mean, what you know, what a blessing and what a luxury if you're able to have. Money that you don't actually need right this very second. Right. That's kind of the point. It's that layer of security. Like, well, if something happens in the future, which something certainly will hopefully happen in the future, that's when I will use my wealth right to take care of myself, take care of my family, you know, make things happen.

Caitlin So, yes, just a second. I need to yell at Alexa.

Speaker 3 Alexa alarm off. I was wondering what that was. It was not the.

Sara Ice cream truck this time.

Speaker 3 Yeah.

Caitlin No, that's right. The ice cream truck did come yesterday. Okay. Yes. It's what we don't need. And our immune immediate future. That is the excess that then we can turn into money. That makes money. I mean, what I'm hearing from you is that wealth isn't how much your salary is, because no, that money isn't going to build over time, like even if you make $1,000,000 a year. Now, come on.

Speaker 3 Like.

Caitlin I guess it depends where you live.

Sara If you make $1,000,000 a year and spend $1,000,000 per year, you're living paycheck to paycheck. I'm not saying it's a you know, it's the same level of lifestyle as people who make $20,000 a year and spend $20,000 a year. But it's not building wealth.

Caitlin But there's this connection that it's not like I think we we've talked a lot about how women's earning potential, like increasing that is a really good way of getting financial security. And I'm sure I've had this epiphany many times, but it's not just okay, because now I have 700 extra dollars per month to do the things I want to do or whatever. It's because that money then can be turned in the money that makes money. Yeah. And so it's not like, yes, we need your salary to increase. Yes, inflow of money is super important, but what turns it from a healthy savings account to wealth is when the money is making money.

Sara Yes, absolutely. I'm because as I don't know, I think most people know. Right. If you're just if you're saving it in your savings account. I mean, I think we all know that you're, like, pretty much guaranteed to not keep pace with inflation, right? So your wealth is actually being eroded over time, like keeping money under your mattress or in a savings account or a checking account just in U.S. dollars in cash isn't building wealth, it's your wealth is being eroded through inflation. You're losing purchasing power almost every single year. Right. So that's actually destroying wealth over time or taking your income and putting it into things that depreciate. Right. Like a car. Like you buy a fancy car, the fancy car is going to be worth less and less every year as it gets used up. Right. So having a high income and a fancy car and a, you know, a savings account and nothing else isn't you're not building wealth, right? You've kind of maybe preserved some of it in different forms, but it's it's not growing. And most of us need the growth. Right. We need the growth over time so that we don't have to work forever.

Caitlin With your clients who have built some wealth because of your expert guidance, obviously. How do people do people then at that level who have that safety, that security of knowing that, like my retirement is fully funded, I'm going to be okay when I stop? What about the money that's left over when they die? Like the typical is like it goes to your kids. Or if you don't have kids, a charity or to other family members. How do people talk about the money that's left over when they die? Is that important to people? I'm trying to figure this out. I'm never it's crazy. I've never thought about how important it is for me to leave money to my. I think I assumed it. But what I strategize and are really specific, what I really scrimp in my.

Speaker 3 Life so that.

Caitlin She got a bigger inheritance.

Speaker 3 Or.

Caitlin Like what's left.

Speaker 3 Over she'll get.

Sara Yeah. That's a really good question. It's really it's really broad. But I do think that's actually the question that a lot of people and at least in my experience, women especially have a hard time. Coming up with the plan for what they want to happen during their lifetime and or after they die with their wealth. I have. A lot of clients who are not spending it fast enough. In order to draw it down over time. Right. They have accumulated enough. And now, at the pace that they're drawing money out of the accounts, there's basically no hope of it falling. It's either going to go sideways or continue to increase in value over their lifetime because they're watching the rate become poor. But, yes, there's there's I mean, you can never say anything with certainty in finance, but by all calculations, at the pace they're taking money out of the accounts now, there's no chance. Their accounts will go to zero.

Caitlin And can I help them with that?

Speaker 3 I'm volunteering to chip in to see what we can accomplish together.

Sara I mean, it's it's it's a it's a different type of challenge for people. Right. And I think it's something that maybe, you know, we don't identify with. But I think maybe at some point you do you do identify with this concept of like, I if I don't need something, why would I spend money on it? Right. Like, I've I have I have everything I've ever wanted. I have my family, I have my health, I have the ability to travel. And so I have like my my wealth is larger than I need. And then coming up with the idea of, okay, well, who is going to spend it right? Is it going to be you or is it going to be the people who come after you? And I think that's a really, really difficult I mean, for all sorts of reasons. Like it's it's all tied up in the most difficult topics to talk about, which are money and death. Right. Yeah. You know. What does it mean to have a certain amount of wealth that you are pretty sure you're never going to need? And maybe you don't necessarily want to think about it being an inheritance or you don't? I don't know. It's I see people struggle with it all the time, and I don't know what the answer is. This is like way beyond my. My skill set, like as a therapist, right? Like, what does it all mean? Right. So I try to encourage people in that situation to make sure they're spending money on the things that either give them joy and happiness or a sense of fulfillment. And then it like when you inevitably set spend money on something that doesn't give you joy or a sense of fulfillment, like let it go. Right. It's fine. You know, just just you don't have to agonize over every single decision. And if you want to do something special, we only have one life. Do something special. Take someone on a trip. Take someone out to dinner. You know, whatever it is that you think is going to put a smile on your face. Because if it's not you, it's going to be someone else. Oh, my gosh. You'll never guess what's happening right now, Caitlin.

Speaker 3 The, uh, the ice cream truck. It's.

Sara It's the fucking Mr. Softy. She's just going to park right outside my house again. I think we're have to change our recording schedule Friday afternoons. Sorry, Kelly.

Speaker 3 Um, yeah.

Caitlin Okay. I can talk because, well, I won't come up on my.

Sara I'll even mute my side.

Caitlin I also think it's interesting because of course, like moms of daughters, we're doing this podcast. We want women to claim wealth. To work on it. To be to to meet our male peers in this space and be as included in investing and financial planning, you know, to to build wealth, to not end up in poverty, to also get the power that comes with having money. But when I think about my kid, let's say I worked my ass off and invested all the money, Sara gave me all the hot tips haha, she doesn't give her tips. And then I had $1,000,000 to leave to my daughter at the end. Like when I think about a kid grow up, okay, she wouldn't be a kid anymore. But like her getting $1,000,000. I also have strong feelings about that. Like, you know that that's not fair. That she gets that. Not just like I didn't get $1,000,000. She shouldn't. But I have feelings about people that had trust funds, and yet I kind of want more women to have the kind of wealth where they can leave trust funds. And yet we have I have a lot of prejudices.

Speaker 3 Against people, but there's a lot.

Sara Happening.

Speaker 3 In Turkey. And you said a therapist I can't remember was that we don't have.

Caitlin To resolve it all here. I just again and again realize how complicated my own feelings are about having money, not having money, having wanting the security, but not the excess, wanting to keep it real, wanting feeling really in touch, like having been worked in the service industry. Like these are all really important things to me and important to a lot of the people that we talked to in the podcast and you know, with about the podcast and yet like what we are hoping people women that we can talk to, can build towards is a level of wealth where they're sort of beyond all of that day to day concern.

Speaker 3 But those feel like my people. So I get used to.

Sara It is confusing. I mean, but as you're you know, as you're saying that as as I'm thinking about the conversations I have with people all the time around this topic, I wonder if, like, what I want for my girls and if what you want for your girl and you know what we want for our our friends and family around us. I think that I want this level of responsibility baked in right. This like sense of like none of us did this on our own. You don't you don't deserve any of this. But you, you know, through through grace and and good luck have it and are responsible for taking care of yourself and your family and the people around you and learning and developing skills around how to be a responsible manager of wealth, you know, with a lot of flexibility built in, built in around that. Because certainly like this issue of having too much wealth. You know, is probably better than the alternative of not having enough.

Caitlin Finally. Right.

Speaker 3 We agree. Yes. Right. Like, okay. Like, well, lucky to have any of these problems that are keeping me up at night. Yeah.

Sara Right. So I think we're all kind of trying to avoid having children with a sense of entitlement or children who just don't have the skills to manage something like this responsibly. At least when I think about it, that's kind of where, you know, I get kind of hung up. And then I think about like, I wasn't I wasn't always responsible. Right. Like, I somehow learned it over time. And a lot of people don't. But it does. There's just a lot of feelings. There's a lot.

Speaker 3 A lot of feelings with all of these.

Sara Money topics.

Caitlin There are. And I realize one of the things that I really liked about the our discussion with Casey Schwartz, who we interviewed for the Sustainable Investing ESG. How to sort of be an ethical investor is that showing the power that money has to influence whole industries by who you invest in, who you don't? The proxy sort of advocacy work that happens in that space. And so where as my primitive association with wealth is sort of like you get you're just too busy on your yachts and your jets to like, interact with the little people anymore. And instead it gives you greater power to influence policies and the way things are done and the values that companies who employ everybody are living by. And so when I think about that, I get very excited. I mean, spoiler alert, this is not a risk for me.

Speaker 3 This feels so heavy. I'm not about to reveal that. I just inherited $20 million and I'm having an identity crisis all angsty wreck at the end. Yes, this is absolutely a manufactured identity existential crisis.

Caitlin But I, I feel really strongly, as do you, about women being proactive and empowered in this space and doing all this learning. And so sometimes I get confused like, Well, but wait. And they'll be like, these totally disconnected, rich snobs.

Speaker 3 Yeah, like.

Sara Maybe. Have I have I told you about how like, my. My. I love reading the story about like Elizabeth Holmes and then that woman who is in the FTC's the woman who is the Alameda trader. What's what's Caroline Ellison like? I want more women committing massive financial frauds. Right. Like, I just think that that's like how we'll know when we've arrived, when we have like an equal number of women committing huge financial frauds, an equal number of women who are just like wasting their lives and wealth, you know, because they control too much wealth. Because then we'll also have more women who are managing wealth responsibly and making a difference and kind of all of those things do. So, like, you can't get you can't take the good with the bad.

Caitlin Yes, yes, yes. More financial fraud committed by women. And yeah, I know this is complicated in that Elizabeth Holmes realm or she cop it was a one of the strategies was like she was so influenced by her boyfriend that, you know, she did all these things because of the force.

Sara Yes.

Caitlin I think in my work as a criminal defense consultant, a lot of the women I've worked with that have committed financial fraud, there's been it's not because of it. It's been because there's been a mental health component. There's been a domestic abuse component. There's been all of these external things, not just like classic bad guys, bad girls that were committing all of this. But I think it's a really it's a reasonable metric for women having arrived and having that power to.

Sara So you're telling me we don't even have any like classic bad guys? I feel like Bond villains.

Caitlin It's hard, you know? I don't know.

Sara Hmm.

Caitlin I think we don't have enough legal funds and the women on the verge for me to start.

Speaker 3 Going by one by one who I think might.

Caitlin Be in that category.

Speaker 3 Or not. I think we have to bulk up our legal defense fund before I mention what I think.

Caitlin About different cases. But I. Yeah. Just for women to be at a high responsibility level where they have access to that and decision making power over that vast amount of money to do stuff like that does seem like. All right. Yeah. We got our turn to.

Sara Yeah, I'm into it.

Speaker 3 Like I see.

Caitlin In a camp. There can't just be one or two because then, you know, then it seems like it needs to be. Did. It was because there are women.

Sara It needs to be commonplace. I feel like commonplace.

Speaker 3 The podcast is taking a weird turn about recruiting women. I'm not recruiting. It's a financial fraud.

Sara I think it'll happen organically as more women control more money. Yeah, people just up and organically.

Caitlin Do that are greedy. Exactly. Yes. Yes.

Sara Exactly. So why.

Caitlin Are. Hubris.

Speaker 3 Women with.

Caitlin Hubris. That's the next podcast.

Speaker 3 Women on the Verge and Women with Hubris. Women on the verge of.

Sara Hubris, of having hubris, whatever it is. No, I mean, because that that's it. It's like you have more. If everybody has the opportunities to make all of the mistakes, then like we don't have to feel like we're held to a higher standard or we have to be perfect or make the perfect investments or can never, you know, never make a mistake or never make a bad investment. Right. Like, people do that all the time.

Caitlin Men do it like.

Sara Men do that all the time. Yeah. So no one has to be perfect. You know, a couple people can get in over their heads. More people? Yeah. I think it should just be common.

Caitlin Well, you put that on LinkedIn.

Sara Yeah, that's. This is the world I want to live in.

Speaker 3 Okay, well, I.

Caitlin Have another question for you, but it's not necessarily related to this. So now I'm curious about whether it's about Roth IRAs.

Sara Oh, geez, Pivot. Okay.

Caitlin But maybe that's not good for episodes. Like, maybe it's better just to talk about wealth for one. And.

Sara I mean, if it's a short one, we could do a short Roth IRA question. If it's a long one, we could do.

Caitlin The whole.

Sara Episode.

Caitlin It's a short one, but we could cover it on the income tax one, too.

Speaker 3 Okay.

Caitlin Okay, I will. I'll do two more. Uh.

Speaker 3 How is my family? I have do not disturb on.

Caitlin Um, I have, um. I wanted to look at what time? My God, everything's happening at once.

Sara Oh, and I have basketball. I'll leave at 530. Okay? Yeah, I. Basketball practice. Okay.

Caitlin Okay, good. I just wanted to get a sense, like, did we talk for 10 minutes? Not 33. Okay. It'll be a shorter episode. That's fine. Okay. Sara, I have a feeling I know the answer to this question, but that's never stopped me before. I want to know when we're talking about this wealth and money, Making money like I have now come up with this definition is when there's wealth. It is money in some realm of your accounts with your name on it. There is money that is making money. Maybe not in 2022. We'll take that out, right?

Sara Yeah. Yeah, we'll just Yeah, through 2021.

Caitlin Okay. You have money somewhere that is making money just because it's money, not because you've worked. Got a side job for DoorDash. It's because your money is now in a quantity that through compounding interest, it is making more money. That is.

Speaker 3 The What's.

Caitlin The tools that we have to achieve this as the normal people without family wealth, without a corporation in our name, whatever is investing in our retirement, maxing out whatever. Retirement. What are they called? Retirement savings accounts are. A brokerage account, a Roth IRA, which I also have questions about. You can save that for another episode. Like, that's what we got. Or real estate like it is. Investing and investing means you're putting money somewhere where it will make more money, not because of your labor. And the realms are. Buying collector sports memorabilia.

Speaker 3 That's what you're.

Sara Starting.

Speaker 3 With. I mean, because I feel like we're a broken record, like index funds and the stock market. I mean, to me, it could be interesting baseball cards. Baseball cards, but for real money making.

Caitlin Money, not side hobbies or collectors things. It's like the stock market or for specialists. And we will have an episode on this real estate investing.

Sara Mm hmm. Yeah.

Caitlin We're not like those are our options. That's what we've got.

Sara Yeah. I mean, those are your best options.

Caitlin Okay.

Sara And if you want to make money faster, they're not your best options if you're trying to avoid risk. Right. But we're talking about growing wealth, right? That's what the whole point is against us.

Caitlin Yes. Yeah. And the more money that's there, the the more money it will make. So people that get and create generational wealth, it's because of the quantity of the money in those accounts that is making interest that they'll never spend in their lifetime. It's not that they have access to accounts that we don't have. I know that to open some brokerage accounts, there's a a minimum balance you have to have. But in theory, I could. The account that I have, if I put enough money in them, will accumulate wealth at the same rate as the rich people's accounts. They just have more of it. So every time they make interest, that's.

Speaker 3 More.

Caitlin Interest.

Sara Yeah. I would say the exception for the the super rich is most people originally create their wealth by starting or owning a business. And so not not not buying shares of Apple. Owning a business, but like starting Apple, right. And growing it from nothing.

Speaker 3 So that's 1.

Sara To $1000000000000 company. Start also starting a business.

Speaker 3 Olive Garden and get a whirlwind. Okay. Yeah.

Sara So just like that's like for super mega wealth. I mean, like, you know, Bill Gates and, you know.

Caitlin They started companies.

Sara They started companies.

Caitlin Or their grandparents started companies.

Sara Correct. You can trace it back to, you know, the Walton family and the first Walmart in. Arkansas or wherever it was started. And so that's like where the super duper mega wealth starts. But I mean, I see a lot of normal, wealthy people who have inherited wealth from their parents. Their parents created generational wealth that is now passing through the generations. And so maybe it's not, you know, $500 billion, but it might be a few million dollars that is being passed down through the generation. And it's up to each generation to figure out how they're going to use it or how they're going to keep passing it forward. And that is almost always done with either real estate or stocks. I haven't seen anything else that's really come through where like baseball cards or, you know, something like that or or gold or anything like that, It's hey, like, my dad worked at this company for 40 years and he saved in his 41k and he didn't spend as much as other people did. And so it grew to 1.5 million. And then he passed away and then my mom inherited it and she didn't spend it down either. And then she died and then I inherited it. Right. And it's just in like a Vanguard account or a, you know, Morgan Stanley account or wherever. Like it's just been hanging out this whole time in mutual funds and stocks, maybe, but over long, long periods of time.

Caitlin You know, this just brings up like we really want to interview this woman who wrote a book called The Whiteness of Wealth. And it just like the people that had access to those jobs were white men, you know, 100 years ago, 50 years ago, you know, women weren't allowed to be police officers until like the eighties. And a lot of places are firefighters. And so I get both, like happy for those people that have inherited that money and weren't they smart, but also like the access part of it where people of color, women weren't allowed to have those jobs that paid that money, that turned into the wealth. And so you really see how problematic intergenerational wealth becomes because the people that are living off of it now is because one of their ancestors had access to that totally. And so that's another reason for us to like really fuck with this system and make yeah. Now to compensate for the years and years of compounding interest that women and people of color missed out on because they weren't allowed the places where you could even make the money to then have it to put in a retirement account.

Sara Absolutely a yes to all of those things. Like if you can trace back wealth, certain people will be able to trace back wealth through the generations and others won't. And they didn't have the access and they couldn't get the mortgages and they couldn't buy the house and they couldn't get the business loan. And that's going back to the not distant past, obviously, right?

Caitlin In my lifetime.

Sara Yes, Right. And so that certainly I hope that like part of this podcast is like, okay, like for some people, can that kind of generational wealth building start now? Can it just stop not happening in some way for some people? Well, yeah. Is there a way to ever go back and make that fair? Like prob probably not in this country, probably not in our lifetimes. But can we. Start start the cycle for people who maybe don't have the experience or don't have the resources right this very second, to start creating that generational wealth building education base, the actual wealth and resources space to grow off of. I mean, I think that that's really important and very, very important to be mindful of always as we're going on this journey that, you know, some people are just getting to the plate and some people were born on third base. Right. And so, you know, should we glorify the people who have vast amounts of wealth, like, yeah, maybe if they're truly self-made, but their people are rarely truly self-made.

Caitlin Yeah, I have a lot of feelings about that. Okay. I this is I feel like this conversation will continue and that it to sort of refocus. I need it all the time about what is our goal? What are we working towards here in my personal life with this podcast, in your work in Austin Women's Investing Group, like what are we doing? We're making up for so much lost time where active laws were preventing us from act like accessing all of this stuff and that. So so I can get like caught up on my esoteric confusion about what it would mean if I became very rich. There's not enough to worry about. But underlying all of this is that like we're standing on the shoulders of the. Women that were like not allowed to have their own bank accounts or the credit, if you were married, went to your husband and not to you. And so we are fighting against like history here and venturing into it. And that's what we really hope is that we can help open that. Anyway, now I have to really, like, go sing some ballads or something. Yeah, I get all up in my feelings.

Caitlin Okay, Sara, thank you for having this conversation with me.

Sara Oh, thank you for asking. I'm. Those were really good questions, and I think we have to keep that. I don't know. We have to keep it in mind as we go through all of these episodes. You know, we touch on like a lot of technical tips and tricks and strategies and things like that, but it is always. Important to keep in mind. Like what? Like, what are we doing here? Like. And not lose the thread. Like, both for the podcast, you know, and for our own investing in our own lives.

Caitlin I thought of something, but I want to ask you first. One thing a woman on the verge can do, uh, about wealth. Like about her relationship with wealth.

Sara Oh, my gosh. I don't know. Do you have.

Caitlin One? I have one. I thought, you know, it's not until this conversation where I even thought of what is my definition of wealth and do I want is it that I leave my daughter $1,000,000 or is it that I am completely relaxed about retirement and my plan to get there? Like whatever? I think coming up with your own definition with wealth could be a really good anchor in the long run to like, What am I building for here? What's keeping my eyes on my prize? Not on anybody else's definition or expectation? Yes. What's important to me in my lifetime, what is wealth mean to me? And it maybe it means that like my idea of wealth is that I can send my kid to college and not be really worried about it. But my idea for my daughter's wealth is that she'll make a lot of money and pass it on to her. Kids like my daughter will make up for whatever I can't because of the building blocks that I give her. But just that we can each think of our own idea of what is wealth mean to me and because then you can enjoy it, it might be more achievable than you think for yourself. And then you can really be proud of yourself.

Sara Oh my gosh, that's amazing. And I love the point about not comparing it to anyone else's definition. It's it's thinking about your goals in absolute terms and not in relative terms, not worrying about like, you know, how am I compared to the other people in my age bracket or my zip code or my, you know, school district, whatever it is? It's like really thinking about it for yourself because then you'll stick with the plan that you put together for yourself because it's meaningful to you.

Caitlin Yeah. And it's based on like what's realistic for you, not like the Instagram story you aspire to. I'm not going on Instagram. But I know I know stories.

Sara Make sure to not follow Caitlin on Instagram.

Sara To follow social media and call out. You can find it.

Caitlin Okay. Thank you, Sara.

Sara Thanks, Caitlin. Bye bye.

Music transition by Bad Bad Hats

Caitlin Hey, before we go, thank you so much to Kelly West, who co-produced and edited this episode.

Music transition by Bad Bad Hats

Sara If your partner is making you ask for money, giving you an allowance are not letting you know about family income. This could be economic abuse.

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

Music outro by Devmo

Devmo I know the first thing you notice is that I'm covered in gold, the flick of the wrist it could turn a hot bitch cold, to get what you want in life girl you gotta be bold. Now Imma die rich, and I know...

Sara 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.