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HerMoney Podcast Episode 200: Why Happiness Eludes Overachievers, Even When We “Have It All”

Kathryn Tuggle  |  February 12, 2020

We pursue money and power, and may even seem to “have it all,” so why, then, does happiness still seem to escape us? A look at what every overachiever needs to know.

When’s the last time you thought about your net worth? What about your self-worth? Did you ever consider that those two things might be related?

This week’s guest, business coach Keren Eldad, has spent years coaching executives worldwide on the correlation between the two, and serves as an advisor to entrepreneurs and executives at companies including Christian Dior, J.P. Morgan, Van Cleef & Arpels and many more. Known as “Coach Keren,” her background includes service in the Israeli Army and a degree from the London School of Economics. 

Listen in as Jean and Keren talk about what it means to be an overachiever, and what drives us to want to be among them. Why do we pursue money and status, only to find that happiness eludes us? “We are constantly pursuing greatness, but cheating ourselves out of happiness in the process,” Keren says, highlighting some of the ways we can start to genuinely feel good about the remarkable things we do on a daily basis. 

Unfortunately, many of us have a “negative radio” that plays in a loop in our heads, and we mentally beat ourselves up about silly things, or tell ourselves that we’re no good no matter what we do. (Even when we’re doing amazing, incredible things, and our friends may even envy us.) Thankfully, “tomorrow is another day,” Keren says. “You have to change the rhetoric in your head to be more accepting, more loving and gentler with yourself.” In other words, it’s okay to stop all of the “striving” and just relax and enjoy life. When you reach a stage of self-awareness or self-acceptance, you can then find clarity and get started with the process of creating real change in your life, Keren explains.

Many people may confuse self-esteem with self-acceptance — but it’s only self-acceptance that we should seek. “Self-esteem will abandon you,” Keren says. “What you’re really looking for is to have the ability to speak to yourself compassionately, and know that we are not perfect, and we are all fighting our own battles.” 

Jean and Keren discuss some instances in which perfectionism (or simply having high standards) can work to our advantage. “When the standard to which you hold yourself is born of inspiration and not fear, then you’re on the right track,” Keren says. You have to be setting goals, not creating judgement — the voice in your head should be saying, “I want to,” and not “I should.”

The pair also talk about burnout, and how people can turn their finances (specifically their savings goals) into an exciting and celebrated game rather than a hassle or worry. Hint: You should “benchmark” your way through your finances and celebrate the incremental successes that you have. If you’ve noticed, people often don’t complete their New Year’s resolutions — that’s because their expectations may be set too high. “Unless we see the fullness of the manifestation, we’re not happy, but when we look at the micro-changes happening on a smaller level, then we can be happy and feel like we’re making progress,” Keren says. 

In Mailbag, Jean and Kathryn tackle questions from a listener who is debating getting an MBA and is curious where she should invest her money once she starts graduate school. Jean also advises a listener debating putting money into a Roth 401(k) or a traditional 401(k), or both. We also break down some answers for a woman who has questions about selling her father’s home in order to protect his estate, or when the time comes to move him into assisted living. Lastly, in Thrive, Jean dives into ISAs— income share agreements, a new way to pay for college.

This podcast is proudly supported by Edelman Financial Engines. Let our modern wealth management advice raise your financial potential. Get the full story at Sponsored by Edelman Financial Engines – Modern wealth planning. All advisory services offered through Financial Engines Advisors L.L.C. (FEA), a federally registered investment advisor. Results are not guaranteed. AM1969416

Editor’s note: We maintain a strict editorial policy and a judgment-free zone for our community, and we also strive to remain transparent in everything we do. Posts may contain references and links to products from our partners. Learn more about how we make money.

The HerMoney podcast is supported by      Edelman
All advisory services offered through Financial Engines Advisors L.L.C. (FEA), a federally registered investment advisor. Results are not guaranteed. AM1969416


Keren Eldad: (00:03)
If you really boil it down to the nitty gritty, it’s Keren, when is perfectionism a good thing? Or when is having standards a good thing? And the answer is you have to understand the difference between having standards and beating yourself up. When they start to work against you, when you yourself are creating judgment versus the goal, you are in a place that is not only going to miss the goal but also gonna create misery in the process.

Jean Chatzky: (00:31)
HerMoney is supported by Fidelity Investments. We want to inspire you to demand more from your money by first knowing what you own, what you owe, and what you want from your money. We’ll help you reach your financial goals faster at HerMoney comes to you through PRX.


Jean Chatzky: (00:56)
Hey everybody. It’s Jean Chatzky. Thank you so much for being with me today. When was the last time you thought about your net worth? What about your self-worth? And did you ever consider that those two things might be related? Today’s guest has spent years coaching executives worldwide on the correlation between the two and when she and I first discussed this topic, I was pretty surprised by some of her research, including the fact that people with a greater sense of self-worth really do earn higher salaries and some studies have shown self-esteem may even affect your salary as much as your cognitive abilities. Of course, we all face situations that are beyond our control like layoffs and health crises and emergencies and they can all set us back financially, but our mindset really does have this tremendous impact on our ability to save and grow and prosper and if you’re ready to take steps to change up your financial situation, I can’t think of a better place to begin then with changing your mind. That’s what we’re going to talk about today. Business coach Keren Eldad, known as Coach Keren is in the studio with me today. She advises entrepreneurs, executives at companies like JP Morgan, Christian Dior, van Cleef and Arpels, many, many more and she’s got a background that is really interesting. A stint in the Israeli army, a degree from the London School of Economics, and maybe we can talk her into speaking to us in one of the five languages she has under her belt. Keren, welcome.

Keren Eldad: (02:47)
Thank you, Jean. It’s a real honor to be here. I love your show.

Jean Chatzky: (02:50)
Oh, thank you so much. Ani midaberet k’tzat Ivrit.

Keren Eldad: (02:54)
Wow, well done.

Jean Chatzky: (02:56)
Thank you. Thank you. That was my two years of college Hebrew, and that’s about all I remember.

Keren Eldad: (03:02)
That’s incredible. You basically told me that you speak Hebrew and…

Jean Chatzky: (03:06)
A little bit of Hebrew.

And I speak pequeno Espanol.

Keren Eldad: (03:09)
Poquito Espanol.

Jean Chatzky: (03:09)
Poquito Espanol. See. There you go. I get an F.

Keren Eldad: (03:14)
That’s fantastic.

Jean Chatzky: (03:15)
What languages?

Keren Eldad: (03:16)
I speak Hebrew, Spanish, English, French and German.

Jean Chatzky: (03:20)

Keren Eldad: (03:20)
The language of love. Just kidding.

Jean Chatzky: (03:24)
Well, it’s very nice to have you with us. How’d you get into coaching?

Keren Eldad: (03:28)
Oh, by accident. My whole life collapsed and then I started asking really, really big questions and discovered through service, through volunteering and through a process of self discovery that this is what I really wanted to do. This business has only been alive for three years. It’s been the great joy of my life. And by far the biggest success and financial success of my career.

Jean Chatzky: (03:48)
What kind of big questions led you to this revelation?

Keren Eldad: (03:53)
Well, I did everything right Jean. You know, you described it very aptly. I went to the right schools. Essentially I did everything in its order. I reached all of the goals that one is supposed to reach in life, including marrying a tall guy, which as we all know is the height, the pinnacle of anybody’s desires.

Jean Chatzky: (04:10)
Don’t tell my husband.

Keren Eldad: (04:12)
And I ended up 35 years old. I was the marketing director at $1 billion corporation and married to said tall guy and living in a large house and doing everything right. And I was absolutely miserable. And this is when I asked bigger questions. Is that all there is? What else is there? And if there is something else that I have an inclination towards, could I pursue it? And that was pretty much it. That was the beginning of everything. That was seven years ago. And here we are.

Jean Chatzky: (04:41)
Here we are. One of the things that you speak a lot about is anxiety and how even the most successful people in our midst are often torn apart by anxiety, specifically financial anxiety. Where does this come from?

Keren Eldad: (05:02)
It’s actually not “even” superstars or overachievers who are plagued by financial anxiety, it’s “particularly” superstars or overachievers who are plagued by financial anxiety. In fact, I found the correlation to be in the inverse. You would think that the more money you have, the less financial anxiety you have, but it comes in the form of the fear of failure, the fear of change, the fear of judgment and those are all completely uncorrelated and almost exacerbated the higher up you go. In fact, entrepreneurs and C level executives are more than twice as likely to suffer mental disorders such as panic, anxiety attacks, anxiety and stress and all of the correlated fear. It has a lot to do with the keeping up of appearances. The, I have all the answers stance, but Michael Freeman’s last studies in Stanford corroborated that which I see every single day in coaching. They are in a larger exposure to that dimension.

Jean Chatzky: (05:59)
I think I know our listenership pretty well. I think we have an audience that is full of over achievers, full of women who do remarkable things. Some men, but mostly women who do remarkable things on an every day basis and don’t always feel good about that, aren’t always able to feel good about that. So, let’s take a step back. I mean, what does it mean to be an overachiever compared to just a regular achiever and what drives us to want to be among them?

Keren Eldad: (06:39)
Sure. And that’s actually also what’s going to answer the question, which is why are they so much more prone to feeling anxiety over achievement? So I too know your audience because I am your audience and I can attest to the fact that we are all over achievers listening here. Otherwise, why would you even want to up-level your life? Why would you listen to a podcast like HerMoney? Think about it. Of course everybody falls into that category. Overachievers are generally speaking classified as people who achieve goals above and beyond the norm or far above and beyond the norm. Generally speaking, people who see their goals to completion, which interestingly enough, according to a recent study I just reviewed by the university of Scranton, is only 8% of people. However, 32% of people consider themselves overachievers as in they are constantly in pursuit of goals and they’re constantly working to improve themselves and in that sense, yeah, you’re right. It is a far, far broader category. Certainly the listeners of this podcast. And what drives them to achieve is the hallmarks of what they believe will attain happiness in this lifetime or allow them to measure up societally most of the time. That is either money or status or a derivative of those because that’s how we learn what success looks like. Now, if you really just look at people who have money and status, very, very much money and status, you’ll see that happiness has alluded many of them, so they’re not directly correlated. But that’s what ends up in this vicious cycle. We are constantly pursuing and pursuing and pursuing and in so doing we’re beating ourselves up and we’re cheating ourselves from happiness and that’s when we end up with anxiety.

Jean Chatzky: (08:12)
When you work with these overachievers, how do you get them to take a step back? I remember having a conversation because I’m definitely one of your women. I feel myself striving and striving and striving and I remember having a conversation with a friend about when do we get to stop all this striving and neither of us really had the answer.

Keren Eldad: (08:38)
The beautiful thing is the moment you asked that question, you’ve created the space for change. So what I’m striving for in coaching is always to get to that question. When does it stop? Karen, please help me. When you reach a moment of self awareness and clarity where you understand that everything you know that has brought you thus far is not going to get you to the next level, is only going to create chaos, that is a huge moment of opportunity. The second way is a problem, a big juicy problem. Trauma along the way, chaos. Now, coach does not want that for you, but I promise you that’s not a bad thing. That’s usually another thing that’ll bring you to a full stop. By the way, my life didn’t collapse because I asked the question. It collapsed before that when I went through a divorce and everything started to fall apart and then I asked the question.

Jean Chatzky: (09:26)
So it doesn’t matter what the impetus is as long as you actually get there.

Keren Eldad: (09:32)

Jean Chatzky: (09:32)
Once you ask the question, how do you start the process of creating the change?

Keren Eldad: (09:38)
Well, of course, creating change is not something that happens overnight and I always question anybody…

Jean Chatzky: (09:42)
That’s so frustrating. I wish it would happen overnight.

Keren Eldad: (09:45)
If it did, however, we would be very bored and we wouldn’t like our results that much. Earnership is a delightful thing in life. That’s why I’m always very suspicious of people who walk out of a guru seminar. Their whole life has changed and you’re like, no, it hasn’t just spent some time with this. And this is why coaching is so effective. It’s a process that takes you from A to Z over several months to really help you mold that into shape. But the first couple of things that anybody can do to start, if you really are at the point where you have asked that clarifying question, is this all there is? Do I have to continue to live like this? What gives? There are a couple of things that people can do. The first is to take that prodigious focus that they have and instead of focusing it on saving and on financial goals and on status goals and on keeping up with the Joneses and on Instagram, focus it directly in the path of happiness, meaning at what you love and at what you love doing and at what you would do naturally. Most of us are burning the candle at both ends and that’s what’s exhausting us. The second thing that they can do that I think is equally important is to stop beating themselves up.

Jean Chatzky: (10:52)
That is hard.

Keren Eldad: (10:52)
Overachieving comes with perfectionism and that’s awful.

Jean Chatzky: (10:55)
And it’s really, really hard for women. I mean, so many of us have those negative radios in our head telling us that we’re not good enough no matter what we do.

Keren Eldad: (11:03)
It’s true. So the best thing to cultivate is a nice self-talk. A lot of us have children who would never speak to a child that way. The way that you speak to yourself in your head when you, I don’t know, eat gluten or miss a workout.

Jean Chatzky: (11:15)
Right. I did that this morning, missed a workout. I was not happy with me.

Keren Eldad: (11:20)
Yeah, well if you did what I do when I occasionally miss a workout. It’s okay. Tomorrow’s another day. You can go a little bit later. Things happen. There were priorities. I just didn’t focus properly. It happens to everybody. We really start to ease our way into a completely different way of existing and that relationship between myself and myself is prodigious. It’s extraordinarily important. Those are just a couple of very, very basic things that people can start to actively practice in their life to change the course of history.

Jean Chatzky: (11:52)
I want to talk about the flip side as well. I want to talk about the people with low self esteem and how do we get them back to normal but before we do that, let me remind everybody, her money is brought to you by Fidelity Investments. You don’t have to know all the answers when it comes to your financial future, but an important question to ask yourself is what you want from your money. What are your financial goals? No matter where we’re meeting you on your financial journey, Fidelity is here to help you reach your goals faster. It all starts with a financial checkup and an understanding of what you own and what you owe. From there the folks at Fidelity will work with you to evaluate your investment options and different ways to grow your savings, discuss your goals, see where you stand and get help taking the next steps at We are talking with executive coach Keren Eldad about the superstar paradox and the dangers of letting your net worth define your self-worth and vice versa. There are people who would never classify themselves as overachievers, who feel a low level of self esteem. How do they get back to normal?

Keren Eldad: (13:10)
All right, so you’re touching upon one of my favorite bugaboos and that’s the self esteem is good or self esteem is what you’re aspiring to. What you’re really aspiring to is self acceptance. Self esteem actually trips people up most of the time because it really depends on two things psychologically. It depends on your achievements, what you have, your assets if you will. And number two how you rank set achievements and assets versus the rest of society. How you measure up. Now unfortunately because life is so volatile and so finicky and as you said we suffer setbacks and we suffer failure, all of us will gain 15 pounds in this lifetime. I don’t care who you are for some reason or other. You can’t always be up so self-esteem will abandon you and that’s exactly when you need your self-esteem. What you’re really looking for is self-compassion, self-love, self-acceptance. These are interchangeable terms and as Dr. Kristin Neff of the University of Austin defines it, number one self-compassion is the ability to speak to yourself compassionately – what we just talked about. The second is the knowing or the understanding that we are not perfect and we’re all running our own race – so the dropping of comparison. And number three, it’s emotional equanimity – the state of being chill. If you can start working and focusing towards those versus self-esteem – how do I boost my confidence and get my hair to look right today – I promise you will have much, much longer lasting effects. And to this end, this is how net worth really does correlate with self-worth. The higher your self-worth, the higher your leverage, the higher real respect for other people, the higher your respect for your discipline and the higher respect for money. It just works all in tandem.

Jean Chatzky: (14:50)
So I have two feelings about this measuring up. I don’t believe that we want to do it without parameters, right? I don’t believe that keeping up with the Joneses, keeping up with random neighbors, Instagram comparisons are at all helpful and I think we should try to steer clear of them. On the other hand, I often talk about benchmarks to know whether you’re on track for retirement and those sort of numbers sometimes drive people crazy too. I mean I’ve posted them on Twitter to not a very good response from people who felt like they had a lot of ground to make up. They are necessary in terms of the amount that we save in order to have the ability to maintain our lifestyles in retirement at a time when we’re not getting as much support from our companies and the government. So how do you square those things?

Keren Eldad: (15:51)
I love that question so much, Jean. If you really boil it down to the nitty gritty, it’s Keren, when is perfectionism a good thing? Or when is having standards a good thing? And the answer is, you have to understand the difference between having standards and beating yourself up. When they start to work against you, when you yourself are creating judgment versus the goal, you are in a place that is not only going to miss the goal but also going to create misery in the process. But if the standard is up-leveling you, is exciting to you, is something that has been born of inspiration and not of threat or fear, you are definitely on the right track. The difference is in a feeling, and I know that that sounds a little woo-woo, but everybody can understand what that means. It’s not I should, it’s I want to,

Jean Chatzky: (16:37)
Okay. All right. I’m processing. I’m taking it all in. It’s not I should, it’s I want to. I want to save more so that I know that I’ll be able to have this life.

Keren Eldad: (16:47)
Because I’ve found that it is an easier life. It’s easier than not having money and in that sense I think many people will agree with you.

Jean Chatzky: (16:56)
I watched your Ted talk on YouTube. You talked about yourself as a recovering overachiever. Why do you use that term?

Keren Eldad: (17:05)
The talk is called you don’t know what you don’t know. Overachievers thrive on knowing what they know. This is the primary obstacle by the way, towards self-growth. It’s a form of cognitive entrenchment. As in, I know what I know and nobody can teach me anything different, and as an Israeli I’m particularly afflicted,. But the more I learned that there is still much to learn here, that other people can offer me help, that there’s always another way to look at things, the more I grew and the more I was actually able to produce much bigger results in my life.

Jean Chatzky: (17:35)
You have said that many, many people who aspire toward wealth and material success, and as I’m listening to you talk about succeeding in your career as a coach and how much of a gift that’s been and how successful, you’ve been at it, it’s clear to me in your mind, success is not a bad thing. Wealth is not a bad thing. But you have said that people who aspire to wealth and success sometimes become victims of wealth and success. So how do we get to where you are, to the place where it’s something that you have embraced?

Keren Eldad: (18:11)
That’s another wonderful question. See, this is why I like the show so much.

Jean Chatzky: (18:15)

Keren Eldad: (18:16)
The truth is you have to flip the journey. Most people think when I get X, I will be happy, but you got to get happy to get X. And that’s really where we change the formula. I brought you a gift today. It’s a book called Solve for Happy by Mo Gawdat who is the COO of Google. And it’s a breathtaking book, and what he’s essentially saying is we are solving wrong. We are creating an equation that is ultimately aimed at money. This is an intention of greed, an intention of lack, or an intention of an acquisition of status or a need for validation. It will never end up happy because the journey is not joyful. The journey is rife with work and hard work and hustle, and these things are still incredibly pervasive in culture. Is that how everybody wants to live? I don’t think so. The reason I know is because the number one reason people end up in coaching is overwhelm and anxiety. So this is absolutely burning people out. If instead you find a journey that actually feels good to you, I guarantee you will have far, far better results. This is also why when I’m working with people on resolving their wealth issues, we have to turn saving into an exciting, measurable, celebrated at every point game. Cause if it doesn’t feel good while you’re doing it, it’s not going to feel good at the end.

Jean Chatzky: (19:30)
You know, that resonates with me for two reasons. First of all, I’ve talked about this on the show a lot, but when I got divorced I started saving like a crazy person because that’s what made me feel safe at the time. And instead of just saving blindly, I would visit my savings every month or sometimes even more often, just take a little tour online of my savings accounts and watch them adding up. And I felt really good about that. That made me feel more in control and more powerful over my whole life. But the other thing that it made me think about was, a long, long time ago, I did a study on money and happiness, a big study with like 5,000 people, and one of the findings was that it wasn’t the completion of the goal that made people happy. It was making progress toward the goal. And if you’ve ever run a marathon or 10K and you’ve benchmarked your way and marked every mile and watched your progress as you have been able to tackle those longer distances, you get that right? It is this taking satisfaction in the fact that a month ago I could only run two miles and now I can run three and a half.

Keren Eldad: (20:45)
It’s funny, we’re were talking in December,. It’s the last month of the year and the last month of the decade. A lot of people are making resolutions. There’s a reason most people don’t complete their resolutions and it’s exactly that. We set our expectations very, very high. They’re very far off . And unless we see the fullness of the manifestation, we are not happy. But if instead you flip that to the micro-changes along the way and the upping of the game along the way, you’re going to stay in it, because what you’re really doing is you’re connecting to the manifestation or to the fullness of what you want now. You’re bringing it into the now and that’s how it becomes much, much more pervasive. This is the placebo effect. This is what Dan Ariely and other behavioral economists teach all the time. You have to make it real for yourself now. Otherwise you’re not going to get there.

Jean Chatzky: (21:31)
We love Dan Ariely.

Keren Eldad: (21:32)
I love him.

Jean Chatzky: (21:33)
Yeah, absolutely. This has been a wonderful conversation. If there was one piece of advice that you could give everyone who is listening to just get on the right track, what would it be?

Keren Eldad: (21:47)
It’s the same advice that I give every single suicide counselor on the suicide hotline that I volunteer on. Be easy on yourself. You are doing much better than you think.

Jean Chatzky: (21:57)
Karen Eldad. Thank you so much.

Keren Eldad: (22:00)
Thank you.

Jean Chatzky: (22:10)
Kathryn Tuggle from has joined me in the studio. I love her.

Kathryn Tuggle: (22:16)
She’s amazing.

Jean Chatzky: (22:17)
I have a new crush. I mean I haven’t had a girl crush in a while, but God, I have a girl crush.

Kathryn Tuggle: (22:22)
She’s so insightful.

Jean Chatzky: (22:24)
And she has the most beautiful eyes I have ever seen. She maintained eye contact and not everybody does that. And I can understand why she’s a really effective coach because you actually hear what she’s saying and you take it in.

Kathryn Tuggle: (22:41)
It’s true. You know, as I’m producing, I’m always listening for something that would make a good headline or a good tweet from a particular episode. And I kind of couldn’t type fast enough. She was just dishing out so many great one-liners,

Jean Chatzky: (22:55)
Fantastic. And in my next life I really want an accent. Like, I don’t have one. And sometimes I think that’s been a very good thing. I’ve lived in so many different places that I’m accent neutral.

Kathryn Tuggle: (23:06)

Jean Chatzky: (23:07)
But yeah, I don’t like an exotic accent. A Southern one. I can do Southern, but only one. I’ve had a couple of drinks.

Kathryn Tuggle: (23:13)
Oh, okay. Well we’ll, we’ll try that out soon.

Jean Chatzky: (23:18)
I know we’ve got a bunch of letters that we want to get to. So let’s do that.

Kathryn Tuggle: (23:23)
We do. Our first note is from Zoe. She writes hi Jean and company. I have recently decided I would like to pursue my MBA, but I’m a bit lost when it comes to financially being able to do so. I’m 26 years old, have paid off my undergraduate student loans. Yay. Have both a sizable emergency fund and rainy day fund and have also been contributing to my retirement account for the two years. I put in 10% of my salary into a 401k rollover IRA without matching dollars. Now that I’m debt free, I was planning on diversifying my investments through a mix of contributions to my HSA, my workplace simple IRA and a Roth IRA. But with the idea of graduate school on the horizon, starting in a year or two, I wonder if I need to change this approach and put money in a five 29 plan or maybe a high yield savings account. Will I simply have to accept taking out loans? The cost of exams and applications have already taken me aback and I’m confused about how financial aid works at the graduate level since most programs come with a big sticker price. My employer will cover $5,250 annually and I plan to still work full time. I know the investment will pay for itself and is a smart move for my career, but I’m unsure how to approach the beastly cost of education once again. I feel like I’m in a secure place financially and don’t want to jeopardize that. Do you have any advice on balancing the cost of grad school with saving for retirement and my other financial goals?

Jean Chatzky: (24:48)
Great question. We don’t get asked about graduate school a lot and it is a total fallacy that there is not a lot of aid out there for graduate school. There’s a ton of aid out there for graduate school. It’s just that the programs themselves are often a little more niche and a little more specific and you can still do yourself a good service by applying to a range of schools and finding one that values you enough to give you a stipend or merit aid. I would start Zoe, by going to some of the big websites that have scholarship databases and just looking at the sorts of programs that might be available to you. These are websites like and I would call the schools that you’re thinking of applying to. Talk to the people in the financial aid office about how other students who have gone through the program have done it in terms of finding financial aid. And then I would probably dial some of the savings back a little bit and funnel some money into a 529 once you get a sense of what the program’s going to look like for you. You mentioned you have both a sizable emergency fund and a rainy day fund. I don’t know the difference. I guess I’m a little embarrassed to admit that, but I think in my mind an emergency fund is your rainy day fund and it sounds like you have perhaps over saved a little bit. The other thing is if you have paid your undergrad loans off while saving, while putting 10% in your 401k rollover IRA, and while putting money into the emergency and rainy day funds, and now those loans are paid off, you could take the money that you were using to pay those undergraduate loans and just funnel it into a 529 for your future goals. The other place you could think about putting it is a Roth IRA because you can use Roth IRA money for education without penalty. So either one of those would be a fine home for the money. Don’t invest it aggressively because you’re looking at starting school two years down the road and that’s not enough of a time horizon to make up ground if the markets dip. But I have absolutely no doubt that you’ll be able to get back on track very, very quickly. I think what you need to make you feel comfortable is a greater sense of the numbers. How much is this gonna cost? Where’s the money gonna come from? Where should I just put it to keep it safe and growing at a conservative but reasonable rate and then you’ll feel a lot better about this. Does that make sense?

Kathryn Tuggle: (27:55)
Absolutely. She says she has plans to work through school and that her employer is going to give her more than $5,000 annually. I don’t think she’s going to end up stuck with a whole heap of debt.

Jean Chatzky: (28:07)
No, it doesn’t sound like it to me either. I mean the average cost of tuition for an MBA program is somewhere between $50,000 and $80,000. Wipe off the $10,000 that her employer is going to give her. But if you go to an in state public university rather than a private college for this, you know you can lower the cost too. I mean of course you want to look at the name of the program. I do think that where MBAs are concerned, it’s a little like law school. I mean you can really do an immediate calculation between the value of your degree at a particular school and what it’s going to translate to in a starting salary. That said, if you’re not looking at those tip top tier schools, go for the value play.

Kathryn Tuggle: (28:58)
Right. It’s true. I definitely feel like with grad school you are buying the network,

Jean Chatzky: (29:05)
No question, no question. And yes, you want to look at that as well, but there is aid out there, so just be aggressive about pursuing grants and scholarships and other aid that doesn’t have to be repaid that you could be eligible for and good luck. Please let us know where you end up and what happens.

Kathryn Tuggle: (29:25)
Yeah, good luck. Our next note is from Chrissy in California. She writes, dear Jean, I discovered your show a year ago and have since told literally all of my girlfriends about it who all say that HerMoney has changed their lives. So thank you so very much for your significant contributions to females everywhere.

Jean Chatzky: (29:42)
That’s nice. Thank you.

Kathryn Tuggle: (29:44)
My question stems from another mailbag question you previously answered regarding a Roth 401k versus a traditional 401k. You mentioned that a Roth may not just benefit people who are young in their careers with a lower tax rate. This got me to thinking. I’m a 33 year old single female in a higher tax bracket at 35%. I currently split my money between a Roth 401k and in traditional 401k because I’m not sure which is better in my situation. Recently ,I’ve been thinking I should allocate more to the traditional 401k because, although I can’t predict the future, I did not think with my current line of work that my income will ever hit the next tax bracket of 37%. So because of this, I’m estimating that my tax rate will stay at 35% during retirement. But of course I cannot say that with certainty. Given this information, is there a clear winner in choosing either a Roth 401k or a traditional or would you recommend hedging my bets and putting money into both? Thank you so much.

Jean Chatzky: (30:40)
I am a fan of putting money into both. I’m a fan of it because in years where your income is higher, you have the ability to pull money out of that Roth bucket and do so knowing that you have already paid the taxes. Also, if you don’t need the money at all, I mean sounds like you’re doing quite well because of your tax bracket. If you get down the road and you don’t need the money and you want to pass it along to your heirs, you can pass along those Roth dollars. It is very, very easy and they never have to pull the money out, so that gives you some additional flexibility. The other thing that makes me think putting some money into a Roth is smarter is that taxes could go up. It may not have anything to do with you. It may just be that tax rates in this country rise. I mean call me a pessimist, but I actually think that when we look at the cost of social programs in this country, we will not have these tax rates forever. Now, I could be wrong. I hope I’m wrong. Nobody likes paying taxes, but I don’t think that you can take that out of the equation, so I would continue down the road of doing both. Then, if you are figuring that you will continue to be in about the same tax bracket, at least you know you’ll have prepaid, some of your taxes and you won’t have to worry about doing it again down the road.

Kathryn Tuggle: (32:09)
That’s a great point.

Jean Chatzky: (32:11)
Thank you. And we’ve got one more, right?

Kathryn Tuggle: (32:13)
Yup. From Judy. She writes, hi Jean. I really enjoy your podcast. I enjoy it when you talk about your mother and I really would like to hear more about how to help aging parents since I’m going through it at the moment. My dad is 86 and my stepmom is 92. They live in Michigan and I live in Idaho. They live in their home that they love and have been in since 1978 but they only have a two thirds interest in the house. The other third is owned by my stepmom’s son, who also lives in the house with his wife. My parents have no other savings and there is a deed of trust on the house that is a joint tenancy with survivorship rights. My question is when it’s time to move the parents into assisted living, how do I get the stepbrother to sell the house? He has no interest in doing so, and as I understand it, he can’t be forced to do so. But if the house is not sold, there will be no money to care for mom and dad. If my step mom dies first, I’m pretty sure my dad would move to Idaho with me, but I’d need the resources from the sale of the house to help care for him. I really don’t want to spend my retirement money on his care. Meanwhile, my dad and stepmom are now developing credit card debt because their social security doesn’t cover their expenses. I’m worried that my stepbrother and his wife don’t really have my parent’s best interest at heart. They don’t cover their share of the household expenses and they took my parents to draft a will that cuts me out. I’m currently managing all my parents’ finances since they’re no longer able to do that for themselves and I have their power of attorney. Thanks for listening.

Jean Chatzky: (33:38)
Oh boy. Oh boy. Oh boy. So I am not a lawyer and we don’t have lawyers on our staff. But I didn’t actually know the answer to your question when it came in. So our reporter Becca, got in touch with an estate planning attorney and here’s what we learned. I’m going to lay it out for you as we understand it, but I also think that it’s time for you to call an attorney – probably an attorney in your parents’ state. I worry about this drafting of this will that cuts you out because if you are power of attorney then you being cut out doesn’t really seem to make a whole lot of sense to me. It seems kind of like a mixed message. And so I’m wondering about that. I also am wondering about whether it is time to look at moving your parents sooner rather than later. They’re digging themselves into a hole with that credit card debt. It sounds, and they may have all of their faculties and I hope that they do have all of their faculties, but we know that one of the signs of cognitive impairment is when packages start showing up. And I’m not sure if that credit card debt is a result of over-shopping or a result of the fact that they can’t buy groceries. It’s a little unclear and you want to do what you need to do to get that under control. As far as the legal situation, what we have learned is that you can generally exercise what’s called a law of partition action and this is basically the judicial sale of a property. Essentially it means that if there are co-owners and one of the owners wants to sell and the other doesn’t, this law states that the one who wants to sell cannot be forced to remain an owner and you cannot stop that party from selling. It’s kind of like a marriage. If one party wants a divorce, you can’t stop them even if the other party disagrees. What happens is that the court then appoints someone to sell the property. In most cases that brings both parties to the table and if the other owner wants to keep the property, they can buy out the first owner who wants to sell. The lawyer that we spoke to also recommended looking to see if there’s a right of survivorship. If so, if the parents both died before the stepbrother, he automatically gets full ownership of the property. If this is implemented in this situation, then it’s an argument for you selling the house in court, for you moving forward to do this. But you’ve got to talk to a lawyer in Michigan. You’ve got to reach out and find counsel and make sure that these are the current laws, that they apply in this case and get some advice that is 100% customized for you and your parents. I am really sorry that you’re going through this. It does not sound like a lot of fun. But I do think your best defense in this case is going to be a good offense and I hope that it all works out for the best.

Kathryn Tuggle: (36:52)
I agree. This is really a tough one.

Jean Chatzky: (36:54)
It is a tough one. It’s a tough one and it’s complicated and there’s all sorts of terms that I was unfamiliar with, but this is why we have lawyers. Nobody likes paying lawyers. Least of all me, but there are situations where you are so much better off spending some money to protect yourself in advance of going down some rabbit hole that you don’t understand.

Kathryn Tuggle: (37:15)
Yup. Time to call in the cavalry.

Jean Chatzky: (37:17)
You bet. You bet. All right. In today’s Thrive, let’s talk about college specifically ISA’s. We’re throwing lots of terms at you today that we have never heard and I had never heard of this either until I read about it In the Washington post. ISA stands for income share agreements. It’s not loan. It’s an investment and it’s a new way to pay for college. Via an ISA, an investor supports a student’s education and once that student starts earning a salary post-graduation, they pay a specified percentage back to the investor for a fixed number of years. You can think of this more like equity rather than debt or, as Mitch Daniels the president of Purdue University, formerly the governor of Indiana wrote in his story, it’s working one’s way through college after college. There’s currently a bipartisan bill on the table in the Senate that would provide government oversight for ISAs. It’s intended to make them more available nationally. Just keep in mind they’re probably not a better deal than federal student loans, which have very, very low rates at the moment. But when you’re thinking about private loans and plus loans, that’s when ISA start to make more sense – just another weapon to put in your arsenal when it comes to paying for college.

Jean Chatzky: (38:45)
Thank you so much for joining me today on HerMoney. Thanks to Keren Eldad for the great conversation and the book, by the way,. It is always amazing to me how our mindset can really impact our ability to reach our financial goals. If you like what you hear, please subscribe to our show at Apple podcasts. Leave us a review because we love hearing what you think. We also want to thank our sponsor Fidelity. We record this podcast out of CDM Sound Studios. Our music is provided by Video Helper and our show comes to you through PRX. Tune in next week, we’re going to be sitting down with Janet Cowell. She’s the CEO of Girls Who Invest – a nonprofit organization dedicated to getting more women into the investment management industry. I can’t wait to hear her thoughts on how women can invest more and get started in some terrific careers. Thanks so much for listening and we’ll talk soon.

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