Are you looking to make a change in your working life? Perhaps with a new job entirely, a new boss at your current firm, career growth or a raise?
Asking for more money — whether you’re sticking with your current company or doing new hire negotiations — is so very important. Unfortunately, even though it’s 2021, we know the gender pay gap is very, very real, with the average woman earning just 81 cents on the dollar of what the average man earns. For women of color, that gap is even more severe, and it seems no matter how high up the ladder we climb, that divide is still there.
Nationwide, 13% of men earn $100,000 per year and above … Yet only 6% of women earn that much. And when you take a look at the world’s billionaires, 89% are men. Then when you look at small businesses and entrepreneurs, we see that 30% of all U.S. businesses are owned by women, but just 2% of female-founded businesses hit 7-figures in revenue. These numbers are depressing, yes, but this week’s guest on the HerMoney podcast is on a mission to change all that. Rachel Rogers is an attorney, mother of four, business coach, and founder and CEO of “Hello Seven,” an organization devoted to helping women increase their income, build wealth, and earn 7-figures per year — without sacrificing their family, health or sanity in the process.
Listen in as Rachel dishes on how to ask for more money, and what makes her say “yes” when one of her employees asks for a raise. “When folks come to me, they’re talking about the additional things that they’re taking off my plate. they’re talking about what more they’re going to be able to do and accomplish in their role when they’re being paid more and given that additional responsibility. Those are the things that sway me more than labor department data on how much people in other comparable roles are being paid,” she says.
She also talks about earning potential, and what it means to truly maximize ours: “I find that a lot of people who talk about personal finance are often talking about ‘What do we do with our 401(k)s and our IRAs and saving for retirement?’ There’s a lot of discussion about divvying up your paycheck, but we’ve already discussed that our paychecks are smaller than they should be because of the pay gap and a variety of other reasons. And so, I don’t want to just talk about how we manage the money we already have. How do we get more of it? Let’s talk about earning potential.”
Rachel dives into how we can find roles that don’t just provide us with a paycheck, but also profit sharing, equity, commission and more. She shares how she started her business with an email out to a small group of people… this led her to get a handful of clients, and her business grew from there. She also discusses how she manages a household with four children along her business. “We as women need to start outsourcing a lot more and delegating a lot more,” she says. ‘I don’t do it all. I have conversations and negotiate with my husband, my children, and everyone that’s available to me for help.”
Rachel also talks about the importance of leaning into your strengths, and embracing your natural gifts. “We are professional women. A lot of us have natural talents at organization, at nurturing, at writing, at marketing or branding. How can we use the skills that we have to solve problems in the world and make additional money? That’s what I want to see a lot more women doing,” she says. “And a lot of women are doing that, there’s a huge amount of women who have side hustles that they’re running on the side in tandem with working a career, and sometimes those businesses become big enough that they leave their career and focus on that, other times it just becomes another source of income. But I do want to see more women looking at, “What are my options?”
Jean and Rachel also discuss Black wealth, and what we can all do to touch the Black community and affect change — not just talk about making a change. We discuss concrete steps like hiring more Black employees (if you’re in a position to do so), and finding Black-owned businesses that we can support.
In Mailbag, we talk about switching 401(k) contributions from a ROTH to a traditional account, and financially assisting our aging parents. In Thrive, the email phrases that make you sound unprofessional.
Rachel Rogers: (00:01)
I find that a lot of people who talk about personal finance are often talking about what do we do with our 401ks and our IRAs and saving for retirement. There’s a lot of discussion about divvying up your paycheck. But we’ve already discussed that our paychecks are smaller than they should be because of the pay gap and a variety of other reasons. And so I don’t want to just talk about how do we manage the money we already have. How do we get more of it? Let’s talk about earning potential.
Jean Chatzky: (00:28)
HerMoney is supported by Fidelity Investments. We all have our own financial needs and goals. Investment advice from Fidelity can help you reach yours. Plus, they have tools like financial checkups and more to help you make smarter, well-informed decisions every day. Visit Fidelity.com/HerMoney to learn more.
Jean Chatzky: (00:53)
Hey everyone. I’m Jean Chatzky. Thank you so much for being here with me today on HerMoney. The new year, whatever new year it is, always brings with it a renewed resolve to meet our goals, to be better, to do better, to improve our lives. And for many of us, our working lives are one area where we may be looking to make a change, whether that’s with a new boss or a new job entirely, or with career growth and a raise in pay in our current position. Asking for more money, whether you are sticking with your current company or negotiating for a new job is so important. And unfortunately, even though it’s 2021, we know that the gender pay gap is very, very real. It is one reason that women have suffered so disproportionately during the pandemic. The average woman still earns just 81 cents on the dollar for what the average man earns. And for women of color, that gap is even bigger. And it seems that no matter how high up the ladder we climb, that divide is still there. Nationwide 13% of men earn a hundred thousand dollars a year or more. Only 6% of women earn that much. And when you take a look at the world’s billionaires, yes, I said with a B not M, 89% are men. Just 11% are women. It’s even true. When we pop over to small businesses and entrepreneurs. Just 30% are owned by women, but just 2% of female founded businesses hit seven figures in revenue. Men are three and a half times more likely to hit that mark. Yes, those numbers are a big bummer. But today’s guest is on a mission to help us change all that. Rachel Rogers is an attorney. She’s a mom. She’s a business coach. And she is founder and CEO of Hello Seven, an organization devoted to helping women increase their income, build wealth, and earn seven figures a year without sacrificing their family, their health, or their sanity in the process. Sounds great to me, Rachel, welcome.
Rachel Rogers: (03:30)
Thank you so much for having me. I’m delighted to be here.
Jean Chatzky: (03:33)
Well, thank you so much for being here from your ranch in North Carolina. We’re very, very happy to have you. Tell me a little bit about Hello Seven. First of all, I just love that the name. It’s fabulous. But what do you do? What kind of programs? What kind of guidance do you offer?
Rachel Rogers: (03:51)
Yeah, well, I created Hello Seven because I found that most of the advice that was going out to women in general and also definitely women entrepreneurs was all about hitting six figures. It was all about like a hundred thousand dollars was like the holy grail. And I beg to differ. I actually don’t think that a hundred thousand dollars gives us necessarily the level of freedom or the headstart that we are looking for. And, you know, as you talked about just now, all of those stats that show how far behind we are economically as women, we need more than six figures. And so at Hello Seven, we focus on helping women build businesses that generate seven figures or more, so that we can see more women millionaires. And I think the world will be a better place when more women are making a lot more money.
Jean Chatzky: (04:39)
I completely agree with you. I mean, my last book is called Women With Money and in it, we talk a lot, I talk a lot about the fact that when women have money, we use that money to make the world into a much better place through our charitable initiatives, but also in the way that we support our families, in the way that we support our communities. So I’m with you. I say more money in the hands of women is a really, really good thing. But seven figures sounds kind of intimidating, particularly if you’re somebody who’s maybe earning, I don’t know, $50,000 right now. So what do you say to a woman who is there and who’s thinking, well, this is just impossible for me?
Rachel Rogers: (05:27)
Yes. I mean, I am a woman who thought it was impossible as well. I grew up low income. There was no generational wealth being passed down. My parents didn’t own property or anything like that. I went to law school. I had six figures in law school debt, you know, and started my own practice just because I couldn’t stomach any of the options that were given to me after I graduated law school, and decided to do my own thing. And I went from, you know, all I wanted to do is replace a salary of $40,000 a year when I started my business in 2010, and now I’m running a $5 million business. So it’s impossible until you do it. And to women who think it’s too much, I say dream bigger, right? I think we’ve become accustomed to making our dreams small and palatable and manageable. And ooh, who does she think she is? Let me just not, you know, draw the attention, negative attention of other people by being too successful. And men never worry about this. This is not something that they’re ever concerned about being so successful. You know? And so I say like, listen, come roll with my squad and you will see that making seven figures is not impossible. In fact, it is incredibly possible. It’s never been easier than it is today given the tools and the information that we have available to us. And so I say, if you want it let’s make it happen.
Jean Chatzky: (06:45)
So let’s make it happen. And let’s talk about making it happen from the perspective of the fact that, as I mentioned earlier, women have lost a lot of income in the pandemic. Many women have taken a step back from work. I mean, the statistics, I’m not going to go there, but they’re really, really demoralizing, especially because we were there, right? We were 50.3% of the workforce when this pandemic hit. There were more women in the workforce than men, and now there are not. So let’s talk about getting back on track and then let’s talk tactically about earning more money.
Rachel Rogers: (07:25)
Yes. Well, I think that that’s one thing that women need to do. Let’s turn towards our money and focus on our earning potential. And I think even in a pandemic, when there’s a pandemic, when there’s a depression, when there’s any kind of economic recession, those who are opportunists are going to look at, okay, what are the opportunities being presented to me by this challenging situation? A lot of companies are made during recessions. And careers can be made during that time too. My hope is that women will see this pandemic as a launching pad, as crazy as that sounds, right? Like, so for those of us who are still working, we’re working from home. We’ve eliminated the commute. That gives us two hours a day back. What can we do with that time differently? How can we manage our time differently? How can we think about the way that we work differently? And, you know, let’s use this opportunity to find other jobs. If there’s no jobs available, then build your own, right? Build your own business. Create a side hustle. And that is one of the tactical things that a lot of my clients start with. They’re working in a career and then they start with a side hustle that can bring in some additional income. And that way all of their income isn’t in one source. And so that’s something that women are doing. I think there’s also opportunity for you to make yourself more valuable and make the case for increasing your income with the company that you’re with, and showing them how you’re adding value.
Jean Chatzky: (08:50)
That’s just three different things that I want to dive into, right? I mean, you just teed up, you know, three different shows in one answer. So let’s unpack that a little bit. First of all, you talked about earning potential. You use the phrase earning potential. What does that mean to you?
Rachel Rogers: (09:08)
Well, I find that a lot of people who talk about personal finance are often talking about what do we do with our 401ks and our IRAs and saving for retirement. There’s a lot of discussion about divvying up your paycheck. But we’ve already discussed that our paychecks are smaller than they should be because of the pay gap and a variety of other reasons. And so I don’t want to just talk about how do we manage the money we already have. How do we get more of it? Let’s talk about earning potential and have that be a conversation that is happening in the personal finance circles on a daily basis. Not just retirement or how to divvy things up. And we are professional women. A lot of us have natural talents at organization at, you know, nurturing, at writing, at marketing or branding. How can we use the skills that we have to solve problems in the world and make additional money? And so that’s what I want to see a lot more women doing. And a lot of women are doing that. There’s a huge amount of women that have side hustles. So they have like small businesses that they’re running on the side in tandem with working a career. And sometimes those businesses become big enough that they leave their career and focus on that. Other times it just becomes another source of income. But I do want to see, more women looking at like, what are my options. Also, you know, look at where you’re working and what is the potential to not just get a paycheck, but to get profit sharing or to get commission. We need to start looking for roles that provide that for us. That is something that we do at Hello Seven. Every person on my team gets profit sharing because I don’t want to just build wealth for myself. I want to build wealth for my team and for my clients. And so that is something that we should be asking for, looking for those positions that provide that. So I just want us to be really focused on our earning potential, as we’re thinking about, all right, what are all the options. If I needed to make $10,000 in the next 30 days, and I had to make it happen, under whatever circumstances, what would I do? What are my options? What would I sell? What could I promote, right? I want us to start thinking that way.
Jean Chatzky: (11:07)
One of the options we have is, as you’ve been talking about, starting your own thing. Whether it’s a side hustle, whether it’s just starting your own business. I mean, I feel like I had a side hustle for many, many years, and then it became my full-time job. And then I started a business kind of after the fact. So I sort of feel like I backed into it. But how do you know when you have the space in your life to do this? And how can you do it in a way that, I mean, we don’t want to necessarily be Uber drivers, you know what I mean? And no offense to anybody who’s driving for Uber because I think that that is a great way to earn additional money if you want to do that. But I don’t think that’s what you’re talking about. I think you’re talking about starting a business that you have control over that has the ability to grow and scale and really make a lot of money. How do you figure that out?
Rachel Rogers: (12:09)
Yeah. Well, one of the first things I tell women to do is really start looking at like, what do you love to do? It might be something you’re already doing in your day job, or maybe you kind of hate your day job and you wish you were doing something else. What is that something else that you wish you were doing? How could you start doing it now, right? And start putting yourself out there. I started my business with an email out to a bunch of people. I was looking for a job after graduating from law school. There was not a lot of great options because it was during the 2008 recession. And so I decided to start my own practice. And the way that I started it was I sent an email to everybody that I knew, literally like 150 people. I just compiled an email list and said, hey, I’m an attorney available for hire. Here are the things that I can help you with. And I started helping people. I got four or five clients from that initial email. And then that was all she wrote. It grew from there slowly but surely. So I think yes, selling our services or our skills. And if you’re really at a loss of like, what is that thing for me, doing assessments can be really helpful. I love the strengths finders assessment, DiSC, Kolbe. Those are some great ways to see, like, what am I naturally good at? Am I a natural organizer? Am I a natural galvanizer? Getting people excited about things. Am I very strategic? We all have natural talents and skills. And I think when you capitalize on those when you’re making money, you’re doing things that are naturally easy for you. It’s naturally something that you’re good at. So you’re going to do more of it. You’re going to do it more often. There’s going to be less lift and like work for you to accomplish that thing. And so that allows you to sort of ride that wave to seven figures, which is one of my piece of advice to my clients all the time is, how can you be doing something and showing up in your business every day in a way that really focuses and utilize your natural skills so that it doesn’t feel hard. Because I think we have this idea that making money is hard. And I want to take the hard part away.
Jean Chatzky: (13:59)
You also talk about solving the one problem that you need to solve in order to grow that business or scale that business. I mean, as somebody who runs a small business myself, I know, it was tough hiring that first person. Then it was tough getting from one person to four people. You know, it’s hard all along the way. What is that one problem?
Rachel Rogers: (14:21)
Well, I think that is the key. If you look at businesses that are making seven figure and eight figure, small businesses and women that I followed for years, and I see who is making the most money, I notice it’s the ones who are selling one thing. And I’m like, oh, interesting. So we’re not putting out 17 offers. Because I think culturally, our society tells women do less with more. Even historically, right? Like we’re meant to be doing a lot with a very, you know, women who ran household hundreds of years ago, right? Very tiny budget. Make all of this magic happen with this tiny amount of money and this tiny amount of support, right? And so how can we, first of all, stop trying to do everything ourselves and do less and do only one thing and do it really, really well and really nail it. Because that allows us to iterate and grow and get better at solving that problem for our clients over time instead of having 12 different ways that we solve clients. And I think that comes from a money scarcity where we’re like, well, if I don’t offer these 12 different ways, I’ll lose clients. In fact, I have found the opposite. You actually make more money when you focus on one thing and there’s one way for people to work with you. What’s your one thing. My one thing is the club. So we have a club called We Should All Be Millionaires. And it’s a membership community for women entrepreneurs who want to build wealth. And every single way that I used to work with clients, it’s all included. So there’s, one-on-one coaching included, there’s group coaching, there’s all kinds of business training available. We have retreats and events. And so everything that I used to offer, all as separate things that I used to sell and market each one of those things and deliver it was very time consuming. And so I decided I’m going to merge all of that into one experience for one price point sell at one time and be done.
Jean Chatzky: (16:06)
Amazing. Amazing. I love it. I know that there are a lot of people out there saying, okay, she teed up, how do I get a raise? I want to come back to that in one second and talk about it. Cause it’s important. How do you make more when you’re working for somebody else not working for yourself? But before I do it, let me remind everybody that HerMoney is proudly sponsored by Fidelity Investments. Whether you are looking for a turnkey way to save and invest, or you need to tap the support of an experienced pro for a more complicated financial picture, Fidelity can help you meet your goals. In addition to investment advice, Fidelity has awesome online tools like financial checkups that can help you make smarter, more informed decisions every single day. And you can visit Fidelity.com/HerMoney to learn more. I am talking with Rachel Rogers, founder and CEO of Hello Seven, which is devoted to helping women increase their income, build wealth and earn seven figures a year.
Jean Chatzky: (17:11)
So I just had an experience last week, Rachel, where my assistant, Rebecca, who is also our social media manager, we have a weekly call weekly check in, and it’s usually, you know, largely the same. We go through what’s happening. And this weekly check-in surprised me because she had put together a PowerPoint entitled Why I Deserve A Raise and presented to me for the next, I mean, literally half an hour about everything that she was doing. And I was, well, first of all, I was a little surprised. But I was also blown away. Like she did her. She laid it out there. She went online. She figured out what other people are making. And I was like, all right. Yeah, I guess you do. What else can people do? Or should everybody be in these work from home days, be doing a PowerPoint called Why I Deserve A Raise.
Rachel Rogers: (18:07)
I love that. Yay, Rebecca. So good. But you know, I’m the owner of a business of 20 employees. And so I get pitched on why I should be giving a raise on, not a regular basis, but fairly often it’s happened. And even negotiating pay as we’re recruiting people. And so these conversations happen a lot and the things that sway me and the things that I think that women should be focused on, first of all, ask for a raise, like ask for it, you know. And of course, make sure that your performance backs that up, right? But you should be asking for a raise. So many women don’t. There are crazy studies. I can’t remember the exact stat, but there’s a stat about how the majority of women don’t ask for a raise ever in their lifetime, which is madness. Let’s change that stat for sure by at least just asking. The other thing is, what sways me is really, I need you to tell me how paying you more money is going to make this business more money. Because at the end of the day, as a CEO, that is my priority, keeping us in business and continuing to accomplish our mission. So show me how paying you more helps us to continue and further that mission. And so when folks come to me, they’re talking about the intellectual property they’re creating on behalf of the business. They’re talking about the additional things that they’re taking off of my plate. They’re talking about what more they’re going to be able to do and accomplish in their role when they are being paid more or when they’re given that additional responsibility in which they want pay to go along with it. And so those are the things that sway me more than what is the average person making at a company this size, according to the labor department. That data is valuable, but I really need you to make the case of like, how is this helping the things that I’m worried about every day as a CEO. And as long as you can tap into that, I mean, that is, you know, just persuasive conversation 101, right?
Jean Chatzky: (19:58)
Right. Well, a lot of it is just math, right? I mean, the thing that she said to me, the social media statistics were great and I was really, really happy to see the growth. But then she said, well, I can write one additional story a week and then you don’t have to pay a freelancer, and that’s going to save you this much money. I was like, okay, done.
Rachel Rogers: (20:16)
Exactly. I love that. It’s true. And I’ve had that too, where folks have said, hey, I’m part-time. Bring me on full-time. Pay me this much. You’re going to be able to cut these contractors lose, and here’s what else I’m going to take off of your plate. So I welcome those conversations. And even if I can’t do it right then I know that person wants to make more money. I know that person is ambitious and I’m already starting to make a plan in my head. If I can’t do it that instant, I’m thinking about what’s the pathway for her to step into more leadership and to able to make more money, right? And so I’m starting to think about it as well. So even if you don’t get an immediate yes, those of you out there asking for raises, you know, hopefully if you’ve got a great boss, they will be looking at, okay, how can I make a pathway for her? Cause she’s not going to be satisfied with the status quo for much longer, you know? And if not, then you know what, Hello Seven is hiring and so are other companies. So jump ship and go somewhere where you’ll be valued and appreciated.
Jean Chatzky: (21:11)
I think a lot of resumes are going to be coming your way. I know that you are leading a lot of conversations about growing black wealth, which is absolutely a necessity. Can you tell me a little bit more about that?
Rachel Rogers: (21:27)
Yes. Well, I mean, if we look at the stats, they’re really sad. You know, the average white families’ net worth is $171,000. And for the average black family, it’s $17,000. That is a damn shame. And that is a result of slavery and the legacy of oppression and racism in this country. And we have to commit to doing something about it. It’s not going to change just by like waiting for it to change, right? We have to put some effort into making that change. And I think as women, as small business owners, we have a lot more power and influence than we think. And so what I like to do and what I like to see from folks who call themselves allies is, don’t just talk about these issues. Yes. Talk about them. That’s valuable, but how can you actually put dollars in the hands of black people, right? Like what are your opportunities to do that? How can you actually touch the black community and affect change with them and not just talk about things? So what that looks like, and what I’ve asked my small business colleagues to do is, look at hiring more black people and putting money in the hands of black people by the software companies that you’re using, and the different contractors that you use. How can you find black-owned businesses that you support? Because oftentimes they’re harder to find. We’re out there. We’re here. It’s just that sometimes we don’t have the network and, you know, for all of the historical reasons, right? They’re just not as easily found. Well put some effort in and find us and put some money in our hands. And that is one of the commitments that I want people to make.
Jean Chatzky: (23:00)
I think that that’s a really good point. I mean, is there a way other than the obvious, just, you know, continuing to look until you find one. Are there networks that we should be tapping into? Are there places that we should be looking when we are, you know, wanting to hire somebody to handle our tech support or whatever, you know, and we want to hire a black owned business. How do we find that?
Rachel Rogers: (23:26)
Yes. Well, there’s a couple of things. One thing I will say is that if you’ve got a diverse community, if your own personal network is diverse, you’re going to have an easier time finding people. So you could start by, you know, making friends who don’t look like you. That’s a great way to begin, is like build your own personal network and make sure that you’re putting effort by going to conferences or going to events or listening to things like podcasts or media that is black created. And so that way you can sort of start to immerse yourself in a different network and not always be sort of in an echo chamber, right? I think that’s one of the things. One of the other things that we do at Hello Seven in terms of recruiting is we recruit through HBCUs. So we’ll specifically go to them and their career offices and make sure we’re posting our jobs there right at the beginning of the hiring process to make sure they’re seeing our stuff. And Carla, who’s my hiring coordinator. She is a woman of color as well. And she recruits on LinkedIn. She will literally go tap people on LinkedIn and go into Facebook groups, which I think is such a great tip. She will find a Facebook group that has like a Facebook group for instructional designers, for example. We’re hiring an education manager right now. And so she’s found Facebook groups of instructional designers, and that’s where she’s posting, where it’s like women of color who are instructional designers and that kind of thing. We were looking for a barn manager here for our ranch and she found a Equestrians of Color, which is a Facebook group. And that’s where she posted. And we got multiple applicants who are women of color for this barn manager role, which is like such an obscure, random type of position to be hiring for, right? But we found those women. So I think if you just are strategic and creative, find where those folks are hanging out, instead of just posting it online in like the typical job boards, find those like sort of niche communities where they’re hanging out and post it there and you’ll get more diverse applicants.
Jean Chatzky: (25:21)
So I mentioned at the top of the show, Rachel, you’re a mom. I didn’t mention that you have four children. How do you do this?
Rachel Rogers: (25:31)
Yes. So people tell me all the time, they’re like, they asked the question, how do you do it all? And my answer is always, I don’t do it all. I have a lot of help and support, which is, you know, exactly what I advocate for. There’s actually two chapters of my book that’s coming out that talks all about building a team and getting support in your household and for your business and your career. We, as women need to start outsourcing a lot more and delegating a lot more. And so I don’t do it all. And I have conversations and wrestle and negotiate with my husband, with my children, you know, with everyone that’s available to me to help. And then I also seek help like in my business. And I think one of the main things that I would love to see women do is hire a personal assistant. Even if it’s just five hours a week at $20 an hour, $100 a week, find somebody on Craig’s list and just start getting a few things off of your plate every week. It is life-changing. Everyone that takes this advice, all of my clients that take this advice, they wind up making so much more money just because they have more mental space to think about their money, you know?
Jean Chatzky: (26:37)
It’s amazing. It’s amazing. When I stopped booking my own travel, and that was the first thing that I outsourced. Amazing.
Rachel Rogers: (26:45)
It’s life-changing. I’m telling you sisters, go get yourself as personal assistant. Just try it for a month or two, short term, and just see what’s possible when you have somebody helping you.
Jean Chatzky: (26:59)
This has been an amazing conversation. When is your book coming out?
Rachel Rogers: (27:02)
May 4th, 2021. So a couple months.
Jean Chatzky: (27:06)
Well, is it called Hello Seven?
Rachel Rogers: (27:08)
It’s called, “We Should All Be Millionaires.”
Jean Chatzky: (27:11)
All right. Will you come back? Cause I have a million more questions that I could ask.
Rachel Rogers: (27:16)
I would love to come back and we can talk about it more. Yes, that’d be great.
Jean Chatzky: (27:19)
That’d be fantastic. Enjoy the ranch. Thank you so much for being with us. And I’ll be right back with Kathryn and your mailbag.
Jean Chatzky: (27:32)
HerMoney’s Kathryn Tuggle has joined me. Hey Kathryn, how are things in Paris?
Kathryn Tuggle: (27:39)
Oh, Paris is beautiful, as you might expect. It’s quiet because of the pandemic, but it’s a lot like New York, quiet because of the pandemic. But still beautiful. We’re still eating lots of pastry and having lots of fun.
Jean Chatzky: (27:53)
I got to say, I felt like the outlier. So we use a tool just to let everybody who’s listening to this show visualize a little bit. We use a tool called Riverside to tape these podcasts. And there are visuals. We don’t let you see them because I’m not ready for prime time, but we do use them. But I can see Kathryn in her Parisian apartment and I could see Rachel and behind Rachel out the door was just this bucolic landscape. And I’m, you know, I’m sitting in my bedroom. I’m wearing sweats. You know, I feel like I’m a loser in this equation today.
Kathryn Tuggle: (28:31)
Not true. You always look great. Your house is so beautiful.
Jean Chatzky: (28:36)
It’s not about that. It’s just, you’re in Paris, you know? Rachel’s like, with horses. I mean, I’m here with Elliot. You know, don’t tell him I said that.
Kathryn Tuggle: (28:49)
Elliot making appearances in the background of your videos is like the highlight of my week. Because I don’t know if he’s going to have like some sporting equipment or like maybe, you know, he’s going to be doing something interesting in the background.
Jean Chatzky: (29:02)
You know, he was doing laundry at one point. I was on a call with. I was actually on a major zoom, like with a client. And I don’t think he realized I was on with a client and, you know, he should have realized cause I put on makeup and I was dressed in a good zoom shirt. And sometimes I work out of my bedroom and I shut the door and I shut the doors to the the closet and all of this kind of stuff. And he comes in and he starts folding laundry on the bed. And they are all cracking up. And I want to say to him, like stop laundry on the bed. Like I’ve got a meeting going on here and he just didn’t realize it. But it was very funny.
Kathryn Tuggle: (29:47)
That’s so funny. I feel like all bets are off in the pandemic, you know? There’s like the classic video of the guy on the BBC, when his kids come in the room, like we’ve seen it all.
Jean Chatzky: (29:58)
Kathryn Tuggle: (29:58)
You know? It’s all been laid bare for the world
Jean Chatzky: (30:01)
And it’s all fine, right?
Kathryn Tuggle: (30:03)
Jean Chatzky: (30:04)
It’s all fine.
Kathryn Tuggle: (30:04)
I think some of our relationships have actually gotten closer because of it.
Jean Chatzky: (30:08)
So I did wonder, because we have a very small team and I did talk a little bit earlier about Rebecca asking for a raise and I wondered if you coached her. Because I know she confides in you. And by the way, that would be fine. Like if anybody’s listening and they’re thinking about, okay, I want to do this. I want to tee up asking for more money. You know, should I talk to somebody else on my team? Should I talk to somebody who’s a little more senior, or a lot more senior in this case than me, about how to best make my case. And it was really polished. And I was wondering, did you walk her through that? Did she practice with you?
Kathryn Tuggle: (30:50)
I walked her through the part where, if you are going to ask for a raise, it has to be merit based. You have to show your boss, what have you done for me lately and what you will continue to do? Because just like Rachel said, at the end of the day, every raise request has to benefit the bottom line in some way. And yes, we are a team and I feel like we are a family. I feel like you are my family, and I think all of your listeners feel that way too. But you’re running a business, right? But you know, she’s really sharp. And I think a lot of those techniques, I think she learned from you.
Jean Chatzky: (31:26)
Well, if she’s listening, she learned from us, you know? I mean, this is how I learned personal finance. You just write about something. You pick up the phone. You report on it. You talk to smart people. That’s how you learn. That’s how I learn. But I was very impressed. Very, impressed.
Kathryn Tuggle: (31:44)
I’m impressed with the presentation. I did not know there would be a presentation for you.
Jean Chatzky: (31:50)
A PowerPoint. With many slides.
Kathryn Tuggle: (31:52)
Jean Chatzky: (31:52)
I know. I know. These days of screen-sharing. Like you can’t show somebody something across the desk, but you can, I’m going to share my screen. I was like, okay, here we go.
Kathryn Tuggle: (32:03)
Amazing. Good for her.
Jean Chatzky: (32:05)
Yeah. Absolutely. All right. Let’s answer some questions.
Kathryn Tuggle: (32:09)
Our first question comes to us from Kelly. She writes, Jean and Kathryn. Thank you for putting on a wonderful podcast that always has great information. It’s so nice to hear an expert explain things in a way that’s not judgmental. You really get the emotions behind financial decisions. I loved when you talked about how the rule is to completely fund your retirement before starting a college fund for your kid, but as a mom, you get that most parents are going to disagree. My husband and I, both of us are 42, received our tax return from our accountant and we are at the edge of the $168,400 filing jointly tax bracket. I make $112,000 a year and my husband is self-employed and his amount hovers around $40,000 to $60,000, depending on income and deductions. To avoid moving into a higher tax bracket next year, should I switch my 401k contribution from a Roth to a traditional account? I currently have a Roth that has $115,000 and I contribute $6,000 a year. And my husband has a SEP IRA with $55,000. I have an HSA that I contribute $6,100 to, with my employer contributing a thousand dollars. I have about $13,500 in my 401k as I have only been with my company for a year and a half. I contribute $425 a month. My company matches 5%. and I plan to up that amount to $500 a month starting in January of 2021. I’m asking about the Roth versus traditional because we always end up owing. Even though I claim zero and my husband pays taxes throughout the year. When I asked our accountant why we still owe at the end of the year after doing all that, he said I make too much – insert annoyed face here. Since I have no plans of making less, I thought that a solution would be to have my 401k contributions taken pre-tax to lower my taxable income but I was told that with tax rates low right now, I should remain with the Roth option. What’s your opinion? Should I switch to a traditional 401k or is there a better option that I’m not seeing? Thank you for all that.
Jean Chatzky: (34:09)
Well, thank you for such a great letter, Kelly. And I hate that when they say you make too much, like that is just, that’s the wrong answer. I mean, I do sometimes feel like, okay, we pay taxes because we make money. And if we are paying more taxes, it’s because we’re making more money. And that has to be looked at as a good thing. So I would say two things. First, this is what a program like TurboTax can actually help you with. If you download a program like that and you play with the scenarios, you’ll see the difference it will make in switching your 401k contribution to a traditional account. You’ll see what it will do to the amount that you owe. And you’ll be able to make a judgment based on that. But I also think that you know, that I’m a fan of having different buckets of money in retirement. I actually like the idea of having some money that’s Roth money and some money that is traditional money so that, based on years where your income is a little leaner, you have a choice about where to spend from as you are in retirement. I do agree that we are entering an environment where taxes probably likely to go up. And for that reason, having Roth contributions overall make sense. But I would both run the numbers and consider that these different buckets of money could be advantageous in retirement as you go forward. I know that that’s not an exact answer for you, but I think that doing a little bit of math is going to be really beneficial.
Kathryn Tuggle: (36:09)
I love that answer, Jean. Thank you so much.
Jean Chatzky: (36:12)
Sure. I feel like that answer actually is kind of a little wishy-washy and I wish I was an accountant who could run these numbers in my head. I’m not. I do think that your accountant should be doing this for you if you don’t want to do it yourself with Turbo Tax. But I don’t think that there is a better option that you’re not seeing, which is the final question that you asked.
Kathryn Tuggle: (36:32)
Yeah, totally. And when so many of these things, there’s not one right path. So that’s why the evaluation is so important.
Jean Chatzky: (36:40)
Exactly. And depending on your husband’s income, you can go back and forth, right? If your husband’s picture changes and he earns more one year and you decide that that year, you want to do the Roth instead of doing the traditional, there’s no saying that you can’t even split your contribution.
Kathryn Tuggle: (37:01)
Yeah, that’s a great point. Our next question is from an anonymous listener. She writes, I’ve been listening to your podcast for over two years and I learn something new in every episode. Thank you for everything you and your team do to help educate others on personal finance. I look forward to hearing you every week. I have a broader question related to helping out parents who are aging and not financially secure. They have no savings or investments. A little bit of background. My parents have had financial issues for much of the past decade after they lost their main source of income. This included the foreclosure of our family home. They’ve since moved and are getting back on their feet with my mom working full time. My dad suffered a health setback a few years ago that has prevented him from working. I’ve helped out financially from time to time when they’ve asked, but I’d like to be better prepared to support them financially now that my career is in a good place with a salary in the six figures. Do you have any advice on good ways to start saving money, to provide for my parents, if and when they need the support. I’m trying to decide what the best vehicle would be, like a high-interest savings account, a brokerage account or real estate, to support them down the line, considering the timeline for providing support may be fluid due to health issues or larger expenses incurred down the line. Any advice you may have on how to bring up a conversation with them would also be helpful. Money was a really sore subject with my parents during my early twenties when they were most impacted by financial issues and I’d like to approach things more calmly and rationally this time around. I appreciate any advice or resources you may have, and thank you for everything you do.
Jean Chatzky: (38:34)
Thank you so for writing and thanks for the nice words about the podcast. The answer to your question really depends wholly on when down the line is. You base your decisions about where to invest your money on when you think you’re actually going to need this money. And my instinct would be that since this need for support from your parents could come up at any time, particularly because of your father’s health, you don’t want to put this money at risk, which to me means not putting it in the stock market, probably putting it into some sort of a high-interest rate savings account, which we all know is paying nothing close to a high interest rate right now, but may, in the future, pay a little bit more in interest. And just understanding that you should probably be adding to it automatically as you would for any other goal, every single time you get paid, letting that money build, dealing with the frustration that it’s not earning money on itself. And then when it comes to the actual conversation with your parents, I got this advice or I watched my mother and father deal with my grandfather, who was a very proud man, and help him with his finances as he was aging. And the way my mother did it, and it was very, I thought, tactful and kind, was to pick up individual expenses, rather than just saying I’d like to give you this money, when for example, the air conditioner broke. She and my father would say, we’ve got this. Or when there was a need for, if there had been a need for groceries. And I don’t even remember if this was a real thing. Instead of saying here’s an extra $200, they would send online groceries. Just send the order. So that the expense was taken care of, but the money didn’t really change hands as much. And I think that that is a sort of, for people who have trouble discussing the sums involved in money, this can just be a more palatable way for them to accept help, even from their own child, right? And you’re their child. You wanting to help them is completely and totally understandable. But I think they have clearly a lot of history here and a lot of feeling that they’ve failed in the past. And what you want to try to do is help them without raising these feelings that they have failed again, because they are back on their feet and they have done so much better. And this is just, you know, life has gotten more expensive and you stepping in to help in bits and pieces, may be the better way to go.
Kathryn Tuggle: (41:50)
I love that advice, Jean. Thank you so much.
Jean Chatzky: (41:52)
Sure. Thank you, Kathryn.
Kathryn Tuggle: (41:54)
Thank you, Jean.
Jean Chatzky: (41:55)
Appreciate it. In today’s Thrive, the email phrases that make you sound unprofessional. These days, with fewer of us being able to have those all important face-to-face office chats with our bosses, we are being judged almost exclusively on our digital communication, our emails. And what we write and how we write it has always been important for success. But the pandemic has put our words under a microscope like never before. While grammar, spelling, and punctuation are always important, the words and phrases that you use in your emails are what separate the professionals from the merely casual correspondence. This week at HerMoney, we checked in with career experts to find the top 10 email phrases that can make you appear unprofessional and what to say instead. Here are just a couple of my favorites. Number one, I’d like to discuss these issues with your current performance. When you’re a manager, sometimes a team member will fall short of expectations and you will need to have this performance discussion. But whenever you need to impart negative feedback, email’s not the professional medium where you want to do it. You can’t read tone in email and your feedback could be overwhelming and cause more confusion than progress. Instead, hop on the phone, hop on zoom, have this conversation in person if you’re there, and then follow up that session with an email listing your desired corrections. Next one, number two, per my last email. Yes, it is super frustrating when you’re asked the same question over and over again and it seems like the person on the other side of that email is not listening. But even if you did explain everything five seconds ago, sending a per my last email email only makes you sound irritated and snarky. Instead consider reorganizing the structure of your message. Put the points that were discussed and that you want to bring attention to at the top of the email, maybe even number them so that everything is clearly laid out. Third, and finally, I’m so exhausted. Maybe you did have back-to-back calls from nine till four, and now you have a solid five hours of actual work to do. It is normal to feel tired and burnt out, especially as many professionals are suffering from extreme zoom fatigue. However, while it may be how you truly feel, don’t complain in an email to your manager, to your colleagues or to your employees. This is a conversation that you have with a friend or maybe your mom. Bottom line, any professional email should be read twice before it’s sent and you should make sure you’re comfortable with every single line. If anything feels off, keep editing until you know that you are sending a message that can only move your career trajectory forward.
Jean Chatzky: (45:09)
Thank you so much for joining me today on HerMoney. Thanks to Rachel Rogers for her wisdom and her encouragement. I love learning about how she forged her unique path. And I look forward to having her back on the show as we talk more about becoming a higher earner. If you like what you hear, I hope you’ll subscribe to our show at Apple Podcasts. Leave us a review. 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 Megaphone. Thanks for joining us and we’ll talk soon.