Women & Money: The Shit We Don't Talk About!
Women & Money: The Shit We Don't Talk About!
The 5-Step Wealth-Building Framework with Annie Cole
Most people rely solely on their job (and maybe a retirement account) to build wealth. But here’s the truth: there are 5 powerful areas anyone can tap into to take control of their financial future!
In this episode, we're so excited to introduce Annie Cole- financial coach, founder of Money Essentials for Women, and author of 101 Ways to Build Wealth in Your 30s. Annie walks us through her own inspiring journey from social work to financial independence, including some major career pivots and the moment she decided to start investing.
Annie didn’t just climb the ladder, she rebuilt it. She went from earning $26K in her first job to confidently asking for double the salary by changing her mindset and honoring her worth. In this episode, she breaks down her five-step wealth-building framework to help women create a clear financial vision, budget with confidence, build multiple income streams, and invest with purpose.
Annie shares super practical advice, especially if you’re just getting started with investing, exploring side hustles, or thinking about retirement. She also talks about why knowing your household finances inside and out is non-negotiable, how to live within your means (without feeling restricted), and what financial freedom really looks like. Bonus: She’s giving away free digital copies of her book, 101 Ways to Build Wealth. Grab your copy here!
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[00:00:00] It's so interesting, Mag. We talked to all these amazing women and the ones that have had these great jobs like at Google or an attorney or something like that, and they left because they were miserable. They made a ton of money. Which after a while wasn't important to them and they really found something they'd rather do and use their skillsets in different ways, and maybe they didn't make as much money, but they were so much.
Better off and happier doing that work. And I think oftentimes we talk about, doing the thing, going to school, getting your degree and slotting you into a position that you're supposed to work the rest of your life. I mean, it's all changing and it's because people are taking bold moves and saying, I'm not doing that anymore.
I mean, I did it myself when I was working corporate nine to five, and I'd pull into the parking lot , I don't think I can get out of the car. I just don't think I can do this anymore because it wasn't in alignment with the work I wanted to do and with what I felt I could offer the [00:01:00] world.
And so many of us, you know, step out on that skinny limb and say, I'm gonna do something that aligns more with my value system and I'm not trading my time for money anymore. I remember having this job before doing purse strings. That was in a little literal cubicle and I had no work to do and I was literally waiting for the clock to turn five and I was like, can I not take a lunch and leave at four?
They're like, no, you can't. I was like, okay. You know, like, and I would just literally wait for the minutes and I was just thinking like this cannot be my life because I'm gonna go crazy in this literal cubicle, especially when we have daylight savings and I come and I go and it's dark out at both hours.
I knew that was not for me. You couldn't pay me enough to just sit there. So I, get that of trading time for money ' cause you're just counting the minutes, And so what many have done is really stepped back and assessed what makes me happy? What are my skill sets? How can I parlay my skill sets into doing something that I really love?
And, [00:02:00] you try things and, it's exciting because not only is it a change in your career, but when we talked to Annie just now, what she said was, when I invest my money is making money for me every single day, and I don't have to be concerned about a nine to five paycheck because I'm leveraging the money.
I am Ernie, even if it might not be as, much as a nine to five, I'm investing it wisely and it's growing on my behalf. So I have to look at that as part of my, growth and income and my whole money picture. And we've gotta count that too. It's exciting to know that like, I maybe put in 40 hours and maybe my job gave me 60,000, but without doing anything else, I also received, another 10,000 from my investments just growing by themselves.
And so we can't earn that money without putting in the time, which is, I can see why she was excited to see that. See that? Yeah. And what I loved most was, what did she start with? $26,000 and being a social worker. Yeah, patient does. She [00:03:00] started there, but she left, right? Yeah. And she opened an account with $1 just to watch it.
Gotta get started. Just to watch it fluctuate and grow and learn about investing. And you can do that right online on an app, right? Yeah. And see your money grow. So when we talk about investing, what's cool about it is A, you can add to your income or to the growth of your retirement or future savings just by investing the money you are earning.
And B, investing is not hard. You don't have to have a million dollars. You can do it right online. You can work with a financial professional if you so choose, but you can start learning just by dipping in your toe, adding a little bit more, adding a little bit more, and then being financially conscious about should I spend this a hundred dollars on some new clothes, or should I invest this hundred dollars in the fact that.
I wanna go on a cruise next year, or I wanna go to Europe in three years, or for my financial future when I get [00:04:00] older. So it's really a financially conscious choice. Yeah. And Annie has given tips and insights and actionable things on how to go about doing all of this. So I think we should just dive into the episode and get started.
Let's do it.
Gloria Steinem once said, we will never solve the feminization of power until we solve the masculinity of wealth. Barbara Provost and Maggie Nielsen are the team at purse strings that will help you navigate the ins and outs of financial independence so that you can be financially fearless. This is women in money, the shit we don't talk about.
Maggie: Annie, welcome to Women and Money, the shit we don't talk about. We are so excited to have you on today. Could you introduce yourself to the listeners for those who haven't met you before? I.
Dr. Annie: Yes, so I'm Annie Cole. I am a money coach and also the founder of Money [00:05:00] Essentials for Women. So it's a one-stop shop where women can come and get financial support.
We cover really everything you can think of from budgeting to tax advice to general financial planning, but we also help women where money kind of meets. The intersection of life. So business, career, everything else that comes to money. So, yeah, I love the topic of your podcast because I think money is hard to talk about and, you know, I'm hoping to hopefully make it easier for women to talk about money in the world.
Barb: Okay. So Annie, you've had quite a journey your first job as a social worker earning what, 26K to now planning for retirement at 45 with multiple streams of income. Can you walk us through the pivotal moments in your career that you led to this remarkable transition?
Yeah, there have been quite a
Dr. Annie: few pivotal moments, yeah. That I can talk about. Yeah. Some of the big ones. So when I first got my job outta college, I think like a lot of people, I thought, I got the [00:06:00] degree, so I'm set. Right? I'll be able to make plenty of money and it's just not true. There's so much that I learned about, there are certain jobs that
you can only make so much money, it's very hard to grow up in the career ladder. So I think that was a pivotal moment. 'cause I realized if I wanted to make enough money, I needed to change my career path. So I actually made a complete 180. I took a temporary break from social work, went into the higher education.
Space. Went back to school, got my master's, got my doctorate degrees, and slowly climbed the ladder and learned a ton about what it means to just advocate for yourself and advocate for your worth. So that was a big part of the journey. And then I would say closer to now, one of the things that's changed my life is learning how to invest.
And so I think. Making that mindset change and just learning what it means to go from, Hey, I work to make money, and my hours make me money, versus I'm investing my money and now my money is making me money to the point that I can eventually stop working. That was [00:07:00] a huge, pivotal moment for me.
Barb: Well, it's such a mind shift, right?
I mean, we grew up thinking you trade hours for money. Like how much do you make an hour? Yeah, that's how much that hour is worth. But and really social work. God bless you, EV everybody who in social work, it's so needed, but they just don't pay you enough. Right? So unfortunately, so we know that either you need a side hustle or you need to do what you did, which is get more education, different skill sets and change your job then.
Maggie: Yeah, like what did you get your new degrees in or what was kind of that next step from moving on to doing social work to kind of being that advocate?
Dr. Annie: I loved being a, I always identified as a helper, got my degree in psychology, my bachelor's degree, and thought I wanna help people.
And I think it was, social work was too much personal, emotional toll. I was definitely taking it home with me. So I thought, how can I transition into this peer support in a little bit lighter environment? So. I got a job working in [00:08:00] a student center at a college, and so I helped first year students, first generation students, and then got my master's degree in higher education and my doctorate in education, so I really wanted to focus on that helping, but in the more advising educational.
How to get the degrees, how to further your career path role. And that was a ton of fun. And then along the way, also really focused on data and research and how we can use data to really help people out. So for example, when a student comes in, there's a lot of things we can look at to say, okay, these are the areas where you're gonna flourish and these are the areas where you might struggle.
So we can preemptively give you the supports and resources to help you out even more. So it was a ton of fun to be able to be doing that work. And then also getting the degrees at the same time.
Maggie: Yeah, it's fun to see the aspects that we like and how we can take that into different jobs and different careers.
'cause when we come out of, high school and then college, it's very like, you're a firefighter, you're a doctor, you own a business. Yeah. Like, they're very straightforward, these buckets, but then you're like, I see how I can, [00:09:00] later apply these different things that I like into a different position that, can make me a livable wage.
Right. Yeah. And it's just fun to see how those characteristics kind of carry over. And so I know you have some five kind of keys to building wealth that you talk about, so I'd love to kinda run through those and share, how listeners can start using them in their everyday life.
Dr. Annie: Yeah, so I think the five step wealth framework that I use, I talk about it in my book and I also use it when I'm coaching clients.
I really stumbled upon it in my own experience because I feel like the general advice is two pronged. It's have a budget. Have a job. And those are the two things we focus on. Like, and mostly it's just have a job. If you don't have a budget, but at least you have something in your bank account, it's fine.
But and those are actually further down the framework for me. So what I ended up learning is that money, there were times when I was making a lot of money and I was happy in times when I wasn't happy. So step number one is actually having a vision for your life. [00:10:00] Because if you don't know where you're going.
It's gonna be hard for the money to make you happy. You could be making more than enough and spending it on crap that has no value to you. You could be working hard and burnt out and making good money, but you're exhausted. So once you have your really clear financial vision of what you want money to do for you, what do you wanna spend your days doing?
What do you want your life to look like? That's what we wanna be grounded in. And that actually lays the framework for 2, 3, 4, and five. So then step number two is having a budget. Crunching the numbers, knowing what you need to turn your vision into an actual number set. Number three is then creating the income to live the life you want based on the vision and the numbers you've crunched.
Number four is going beyond just income to actually invest and build wealth and learn how to compound your money and make it work for you. And number five is sustainability. So that's creating habits and lifestyle. That keep your life going and keep you in check. So again, I think it's so different than go out and get a [00:11:00] job without a vision and then flipping it on its head and saying, what do you want your whole life to look like?
Not just your career.
Maggie: Yeah, we don't take enough time sometimes to step back and really feel, what do we wanna do, what do we want it to look like, and how can a job help me get there? Yeah, it's always been, have the nine to five and just do the grind and maybe one day, you'll retire.
Yeah. So it is really flipping it on its head, changing that dynamic and putting your goals first and then what money needs to support you there.
Dr. Annie: Yeah. Yeah. I think it's really empowering and hopefully just a different way of looking at life for folks and making it so we're not so career centric.
I mean, I love work. I think making money and creating an income stream is really important, but it's almost too much of a focus we need to remember. We still have family members and hobbies and lifestyles, and we wanna make the most of that.
Barb: Did I read where you were looking for a job and you put in the amount of money you wanted to earn and then you just upped it [00:12:00] 20,000?
Dr. Annie: I did. Yeah. I actually just, I post about this story every now and then because again, my background's in psychology and mindset is. I just know how important it is. So I was being paid $30,000. This was when I was working at the college and I thought, okay I'll set the bar to 40,000. That seems reasonable, right?
And then I thought, well, why? I just got my doctorate. Why can't I ask for a little more than the normal amount? And I didn't even know what normal was, but I thought, well. Let's try 60. So I put the bar, I set the filter on Indeed to 60, started applying and got a $60,000 job. And it was this, it really shook my mindset to the core to believe, okay, I can quantum leap in salary.
It doesn't have to be a straight line. It can be major shifts and I think not enough women know. What your future self is capable of is. It doesn't have to be linear. It could be something massively different than what you're doing now. [00:13:00] And so that was just a real life experience of that and how it just started with mindset and it ultimately resulted in a salary change.
Barb: yeah, why didn't you put a hundred?
Dr. Annie: I wouldn't, I mean, my brain could not have even comprehended that at the time. I would've thought, I'm not worthy of that. That's not possible. Nowadays I would, but yeah, back then, that probably would've been too beyond my thought processes.
Barb: Yeah, it's interesting. We both have the same doctorate in EDD, which most people don't even know what that is, but I know we do. We do. Yeah. Yeah. So for someone, starting out with smaller amounts to invest, what would you recommend be the first steps to start investing, to diversify your portfolio?
For women who are like, maybe it's time for me to start taking this on.
Dr. Annie: Yeah, I think I would go back to the five step framework first, because I think one thing that happens a lot in with our finances, we can Google our way to almost anything we wanna know, right? There's just an overload of information.
We all know we should be [00:14:00] investing, saving, budgeting, and yet so many of us don't do it. So I think the first thing we have to do is have a clear vision. And if you know why you wanna invest. You know what investing will do for you. It'll create this intrinsic motivation and this vision that will get you excited to keep going.
So, for example, one way you could practically do that is pull up an investment calculator online. There's a ton of free ones if you just Google free investment calculator. See what would happen if you put $10 in a month and got a 10% annual return and just look at what would happen in the next 10, 20, 30 years that will get you excited.
And then if you think, okay, well I could do that, but I could probably do 25 or I might be able to do 30, what would that look like? The more you start playing around with it and see the vision of what it will do for your life. That would be step one. And then step two I would say work with a professional.
If you need to make sure you have all the technical information right, but set up an account so you can set up either a retirement account [00:15:00] or a regular investment account. And hot tip for people who don't know. You do not have to have a job to get a retirement account. There are retirement accounts for people who are self-employed or not employed.
So don't let that hold you back. And then once you have your account set up. You can make your first investment and you can truly just transfer cash from your checking account into your investment account and you can invest invest it and start the process. So those would be the three things I would suggest to start with.
Maggie: The things I wanna highlight there is like how you started with low numbers. You didn't start with a hundred or $300, you started 10, maybe 25, and then 30. And like, is that gonna be enough forever? Probably not. But is it getting started, opening an account, getting in the habit, putting that one step in front of another, just getting used to the thing.
Yes, a hundred percent. And so it's really. I think we can all find $10. It doesn't have to be even a hundred. And sometimes it's like, well I don't know about a hundred, ten's fine. Just get started. Yeah. But then also we all have access to this. I know [00:16:00] so many stay at home moms, don't think that they have access to those retirement accounts or entrepreneurs, or just gets put on the back burner, which I understand as well since no one else is automating it for you.
Yep. But that there is that opportunity for everyone. And so even us as entrepreneurs or stay-at-home moms putting in $10. I mean, those are huge steps to take. Yeah,
Dr. Annie: they really are. And another thing that I suggest people do, it might seem silly because it's so small, but what I did when I first started investing, I didn't know what I was doing and I knew I wanted to get started and I wanted it to be a risk-free experience.
So I literally opened up. A regular investment account and I put a single dollar in it and for about one month I just opened the account every day. And I watched what happened to the dollar because I wanted to understand what it would feel like to watch my money go up and down and understand how the stock market works.
'cause I really, I just didn't have a grasp on that and or know how it would impact me to watch my dollar go up and down in value. So even doing that is gonna give you so [00:17:00] much education because it's your dollar. You'll watch it go up and down in value, you'll see how you emotionally react to it. You'll start asking questions like, why did it go up today?
What was I invested in? Why did the market change? So it's just a super easy way and it's a dollar. So, yeah, it reminds me those huge risk.
Maggie: Examples where they're like, if you wanna start going to the gym, just, sit up and put on your gym shoes. Just, yeah. Just, okay, just walk into the gym.
You don't have to do anything there. Just walk into it. It's just getting used to those little things and how you're feeling and getting in the habit and having the app and just doing the actions. Yeah. And then kind of that money will come with it.
Dr. Annie: Yep.
Maggie: Absolutely.
Barb: It's like strengthening that money muscle almost.
We don't start out running, we start out with just crawling and the baby steps. But it's just getting started. And we know the number one regret of women is that they even, they either haven't gotten started or they started too late. And we know the cost of waiting. Is so [00:18:00] impactful. We did a piece where we did put a hundred dollars in either a high yield savings account or the market.
And what you just look at, if you did that every month for 30 years. It gives you so much money that you probably don't even think about. And so there's a trade off like, do I wanna buy myself another fancy purse or do I wanna put this in the market and see it grow and compound and be there when I'm older and I think, gosh, I've invested in my thirties and now that I'm in my sixties, I have all this investment money that's grown because I made these decisions early on.
Dr. Annie: Yeah. Yep. It's so important and one thing that's actually helped me a lot in that area. Because I started investing small amounts and I used to spend a lot more on random things. I would go shopping a lot for clothes and for makeup and all the things. The more I started getting excited about what investing could do for me, the more I found myself putting that extra money in there.
So again, I think it comes back to having a [00:19:00] vision, because the vision is what's gonna keep you going when. You wanna spend the money on something else. But the other thing that I've really embraced is living a more minimalist lifestyle. So these days I think my budget on an average year is only about $40,000.
I live very minimally don't spend money on a lot of things. And I've done a lot of internal work and journaling and reflection on what are the things that are most valuable to me. And it really is having dinner with friends. Being able to sleep in, going on a walk with the dog. So the more you can think about what brings you value in your life, the things that are free or low cost, and fill your life with those things, you might find that you naturally stop spending on other things and you have that money opened up for something else.
Maggie: Those are great examples and I was gonna ask you, what's important to you? What are you spending on? But I love that of just kind of being outdoors dinner with friends, that eating out in that community is kind of important, which is, great to understand. And it's not just cut restaurants from the budget, but it's like, no, that's important to me.
We're gonna go out to eat. That's my [00:20:00] community time, my friend time. Yeah. Building those relationships.
Dr. Annie: Yep. Absolutely. And I think books are a huge one. Like if I'm gonna spend extra money, I'm gonna buy five new books and Okay. Have piles of books on my desk. I think the other thing that it's allowed me to do, and I think a lot of people don't think about this, is you don't necessarily have to work full time if you're cutting your living expenses.
So for right now I'm doing, I am running money Essentials for women. I'm also doing some contract work. I have less time. I actually have to spend working because I'm not spending as much and then I'm putting a little bit less into my investments these days. So your financial journey and your current journey doesn't have to keep going like this.
It could go like this. It could have times where you are going big and climbing the ladder. Moments when you're taking a micro retirement moments when you are living on less or having kids and taking time off. It just, I don't know, there's so much pressure that it has to happen in a certain way and it just doesn't have to be that way.
Maggie: I think that's a great point. That's for, [00:21:00] yeah. And yeah, we, I mean, I think there's sometimes we gotta take those breaks while we still are healthy and young and can enjoy them. Yeah. Not just waiting until like, we're old and, our knees don't feel good and we actually can't do that walk or do that adventure.
But it sounds like you, kind of have some different income streams. I mean, I know you're an entrepreneur, so you don't just have like a nine to five, but you have these different income streams. How can other people who do have these nine to five jobs. Start those or even have the confidence to, to start building
Dr. Annie: that.
I think that's such a good question. I remember when I was working, probably five, six years ago, I saw a, an old coworker that started her own coaching business and I saw her post about it on LinkedIn and I thought, I could never do that. That's just not me. So I think it's definitely a mindset shift, so giving yourself permission to test it out, and also giving yourself permission to fail.
I think a ton of people are afraid that I'm gonna try this. I won't get any clients, I won't make any money, and I will fail. Really, I mean, success looks different to everyone. I would [00:22:00] say test it out. There's also. It would be really valuable to test out different types of things that you might be interested in.
So for example, maybe you are really good at your job and you work at a business and your expertise is marketing. So maybe you want to start consulting on the side. You could, number one, connect with people in your network. Just send a message on LinkedIn to other individuals and say, do you know someone who's looking for specific help with?
Website design with social media, with something very niche within marketing, since that's your area of expertise. You could also go on a platform like Fiverr or Upwork, create a profile that describes your expertise, and then try to connect with people there. If you wanna go, full fledged into launching a business, you can create more of a, like a social media account dedicated to your business, a website or some sort of landing page, and start direct directing traffic to your page so you can do it.
In a very light touch way while keeping your job or in a more heavy, I wanna launch this business kind of way. And then you can keep [00:23:00] dipping your toe in until you start making enough money and you can decide, I wanna make this to be part-time on top of my full-time work. Or you could eventually transition out of full-time work.
So it doesn't have to be black and white. It really can be like this gray testing the waters.
Barb: There's so many opportunities these days online, right? When I was young and I was going through school, working during the day, my side gig was waitressing at night. Right? And it doesn't have to be the standard, part-time job that you're doing at night.
I. That many of us fell back on. You can create your own work, right? With Upwork, Fiverr, just on the internet, you can create what you are really good at and offer a consulting on that or some people just love, to make jewelry or whatever it might be, maybe even Etsy shop.
There's so many different opportunities for people to leverage their skills and expertise in ways that bring them joy as well, and not just kinda, I have to make more money, so now I have to wait tables or something like that.
Dr. Annie: [00:24:00] Exactly. Yeah, and it's, you can turn your craft. So I wrote a book and published a book last year.
You can self-publish on Amazon, which is what I did, and get your thoughts out into the world and educate other people. You can sell jewelry, you can sell a ton of different online templates. So whether you're good at newsletters or again, graphic design. Budgeting templates. You can sell those kind of things on Etsy or on your own website.
There's just so much you could do with your hobbies to turn them into something that is making money on the side. And one other thing that I love and is very low hanging fruit for folks that wanna test out a side hustle. Do online research. So there are definitely lots of places where you can take surveys and they're gonna pay you a dollar to take a survey.
Don't do that. It's not worth your time. Your time is precious, but there are legitimate places that will actually pay you, $50 an hour, $150 an hour to participate in surveys, focus groups, and interviews. My favorite place is respondent.io and there's [00:25:00] another one, I think it's called user interviews.com or.org.
Check those out. They have very legitimate research studies by big name companies and they're looking for participants all the time, and it's a ton of fun. You just get paid to share your feedback.
Maggie: I did that one time. I've done that a couple times, but I get the surveys and I fill 'em out quickly and one was like just going to the sporting goods store and meeting them there and just telling 'em like, how you're shopping through the store, what you're looking for.
Like why would you buy this? Why wouldn't you buy this? What do you think of this brand section? I was like, you want my opinion? I'm happy to share. Just talk isn't cool for an hour and tell you what I think I was like. Sign me up, for 150 bucks. I was like, this is not bad at all. Like, and it was just kind of fun, interesting to see, as someone who does their own, a lot of our own marketing to see what other people are looking at and how they go about it.
And just as a business owner, I always like to see what other people are doing and how they're doing it and stuff. So they can't be a lot of fun. And I do, I mean, you don't get, picked for [00:26:00] all of them. They're, can be specific, but the surveys usually take two minutes to figure out, if you're in or not.
So it's a lot of fun. I do recommend that as well. I'll have to check out those websites though 'cause I don't think I know those.
Dr. Annie: Yeah they're a ton of fun. I recently, I did one and it was feedback on tanning lotions. Great. And it was like, yeah what do you like, what do you think about this label?
What do you think about this color? And it's, yeah, it's actually really fun. I have a good time with it, so That's awesome.
Barb: Yeah, that sounds like a lot of fun to make some easy money. So, good tip there ladies, if you're listening. But you've managed to invest and acquire a substantial retirement investment, and is that because you're looking to retire early?
Then the typical 65 67, what's your plan for your future there?
Dr. Annie: I think when I first started the goal was I just wanna be able to stop working and I wanna have freedom of choice. And I think at this point, when I [00:27:00] first started investing really heavily, I was working full-time, experiencing some burnout, was feeling like, I don't wanna do this forever.
What I'm doing now, running my own business and being able to work on my own schedule and do something that really lights me up. I could see doing that for a very long time. So I think my needs have changed. My wants have changed, but I ultimately see investing as the best way to number one. Create wealth almost out of thin air.
If you think about it you're putting your money to work for you to make you more money, and it just gives me unlimited choices. So if I did wanna retire in my forties, I could do that. If I don't have kids, so if I wanna have kids and be a stay at home mom, I could do that. If I want to keep working and have even more in retirement, I could do that.
So for me, it's the freedom. It's the freedom that it gives. So I anticipate I'll probably keep working a lot longer. But I love knowing that I have the ability to do a bunch of different things.
Maggie: And for those listening, how do you kind [00:28:00] of find that number that would be like, I have this amount so I have enough to retire at the age of 40 or 45.
How do you kind of find what that would look like or predict? What things are gonna cost when I'm 80? If we're already, if prices are already rising?
Dr. Annie: Yes. I'm so glad you brought that up. There's lots of ways to do it. So I have my own budgeting template that I've been using for years, and it does, there's a couple things that I'm calculating in there.
So, number one, if you wanna know how much you need to retire, I highly suggest again, I. Googling free retirement calculator, and you can find out exactly what you would need. So you're gonna need to know, number one, how much your annual expenses are. So you'll wanna create a budget and know how much it costs for you to live each year, and then every year in the future from now, we can expect that things will get about 3% more expensive.
So. You would wanna calculate, and there are online calculators that will do this for you, like 20 years from now, things will be this much more expensive. Therefore your [00:29:00] $60,000 that you need to live on a year is now more like 110,000 a year. So you'll find out what those needs are. And then there are a couple different ways you can find the retirement number.
So the 4% rule is a really simple one. That's the amount that you can pull from your investment account and live off of it forever. And not run out of value. So let's say you had a million dollars. Your 4% rule is saying that you could pull 4% of your million dollars to live on every year and never run out.
So that would be, I think, $40,000. That means you could pull $40,000 and live on it every year and it will adjust for inflation and growth in the market. So those are just a few of the different numbers, but again, there are online calculators that will calculate the exact numbers for you. But definitely don't forget to account for inflation and things getting more expensive every year because what you need to live now is not gonna be what you need to live 20 years from now.
Maggie: Yeah, I mean, I think about, our grandparents and they were, $60,000 was a ton of money to them, and now it's [00:30:00] not taking you as far
Dr. Annie: Yes, exactly. So it,
Maggie: it does make a huge difference. And so it is kind of looking about, what's your lifestyle? What do I want today? If I'm earning a hundred thousand dollars today and just kind of wanna keep this lifestyle, that's what that money would be.
But if I wanna do more travel, more live a more expensive lifestyle, that number will raise. And you have to plan accordingly.
Dr. Annie: Yep. And one thing you can do too, I've done this and it's really helpful. You can have your budget of how you live now, but create a retirement budget because for some folks, they do wanna travel a lot more.
They wanna buy their dream home. That might be a more expensive lifestyle in retirement. I. But a lot of people find it's the complete opposite because you maybe have kids now, you also give maybe 15% of your income to your retirement account every month. That's all gonna go away when you are retired, or maybe you no longer have a mortgage because you've paid off your home payment, or you've paid off your cars.
So your retirement budget could be completely different. And playing around with those numbers can be really helpful.
Barb: That makes perfect sense. But [00:31:00] let's talk about the focus on retirement and women because as we know, women typically live longer and I always say, as women age, they'll typically age alone and they'll be in charge of their like.
Oversight, their healthcare, their welfare. So, what is your advice for women starting out now and thinking about the impacts of women long term in their money?
Dr. Annie: Yeah. I think one thing that I'm a huge advocate for is that women just understand what's going on with finances. And at the very basic level, if you're in a partnership.
Regardless if you are a man or a woman, know what's going on in your household and in your partnership and in your finances. I know a lot of times one partner will lead the finances and the other will kind of just trust that person, but you never know what will happen or if someone will die early or if someone will get sick.
And in general, it's just [00:32:00] good to know what's going on, so know what income is coming in. Just generally what the number is, how those income streams are coming in. Know about your taxes, what are you owing every year, and then know about your budget, what your general expenses are every year. Those three things are really easy, basic things that you can start to learn more about, and then the more you can get involved, if you have an investment account.
Meet with an advisor and say, tell me more about this. Like what am I in invest? I'm seeing this list of things I'm invested in and it says target date fund. What is a target date fund? What does that even mean? How do I know how much I will make each year? Will this go down? Will this go up? Ask questions.
Don't feel stupid. Please just ask lots of questions, and I think you'll start to feel really empowered and educated to know how to navigate all of these things. And then as you get older, you can ask specific people what different things should be costing. So I know for example, my dad just retired.
He's looking at what are my medical [00:33:00] costs? Going to be over the next two years, and they're gonna be very different than what they have been while he's working and having his insurance covered. So, when you go through different phases of life, talk to the people that can get you the answers you need and just keep asking questions.
Barb: Yeah, because that will change all about the questions. I mean, everything ebbs and flows so often because if you're retired at 60, well you still need to pay for your medical benefits. But at 65 or whatever, when you can get Medicare, that expense changes. So I mean, and when you talk about your own living expenses, some people buy up.
Which I would never do, 'cause house is not important to me. And some people buy down, because they think I don't need this big house anymore. My children are on their own. I'd rather use those funds to travel and go see them. So, it is about being very financially conscious about your own value system, what it is you want.
And I really think. Not even living below your means, but living within your means is so [00:34:00] important. Yeah. Because there's just been this compulsion to purchase so much, and I think it might be taking a turn, but we really need to say, is this a value of mine to buy this additional whatever it is, versus investing it in my financial future?
'cause I know I wanna go on a cruise next year, or I wanna, go live in Hawaii for a month and three years, or I want to retire, early. Yeah. What are your values? Yeah,
Dr. Annie: I love that. I think it's so important. And if you don't know, if it's been a long time that you've been spending and you don't even know how to connect your finances with your values, test it out.
Next time you buy something. That next week. Think about how it made you feel. Did it feel like, let's say you went to the grocery store and you bought everything you wanted, you didn't have a plan, you just, you overspent. How did that make you feel and why did it make you feel that way?
Is it because of the dollar amount? Is it because you normally like to be planned and you weren't that day? Is it because of the items you bought and ultimately you're worried about your health and you didn't buy [00:35:00] things in line with your health? So, exploring internally. Those connections and those emotions you have when you buy something can be really telling and can help open your eyes to what your values are.
Maggie: I end up overbuying and then wasting it, and then I get mad about it. Yeah. Oh. 'cause I was like, I wasted it. I wasted the money, I wasted the food. I didn't eat it. What the heck?
Dr. Annie: Yeah. I have that happen very often and I have definitely found, that's when I'm like, okay, I'd rather buy less and go to the store a few more times.
Yeah. If I need to. Versus what I used to do, which is definitely just overbuying and having to throw stuff away.
Maggie: Yeah. It's hard. Yeah. This has been so much great information and so many actionable insights and really showing how, working now can really project well into the future, especially if you're investing.
But there is a question we like to ask everybody while on the show, and that is, what is your definition of financial freedom, Annie?
Dr. Annie: I think it comes back to choice. For me, it's all about do I actually have the ability to make [00:36:00] the choices I want? And there are a lot of choices we can make without money, but at the end of the day, money is really how we take care of ourselves in this world and pay for the things that we need necessities and beyond.
So. Money gives us choice to be able to do what we want, and I think that's truly what financial freedom is, and I like that more than a number or early retirement or something else, because not everyone wants to retire early. Not everyone wants to have a million dollars that might not be freedom.
Freedom might be very minimal for someone else, but it's whatever level gives you choice in your life.
Barb: that's a perfect answer. It's about choices. And to add to that, we say we don't want people to be stuck, right? We don't want women to be stuck in a marriage or stuck in an apartment that they don't like or stuck in a job they can't stand because, that just weighs on you physically, mentally, everything else.
So having some money of your own so that you can someone call it. [00:37:00] F you money, just move on, get up and get out, and really taking an investment in yourself and in your financial future. So, perfect. Thank you Annie, so much for coming on our show today. We appreciate your time and sharing all of your wisdom.
We know that, what is the name of your book that you have Money Essentials for Women.
Dr. Annie: So my company is Money Essentials for Women. If anyone wants to learn more, it's money essentials.com. Okay. Tons of amazing resources there. And I have a directory of all of our coaches there, so our financial career and business coaches.
And then my book is 101 Ways to Build Wealth And actually we're giving away free copies, digital copies of the book all year long. So if anyone wants a copy, I can share the link. Please share it with your friends. Our goal is really to get as much education, my background's education, so, just educating people about finances and how to build wealth, especially for women.
Barb: Awesome. Yeah,
Maggie: we'll have all of that in the show notes so everyone could click out and grab the [00:38:00] book. Get reading, check out your resources, as I know you have so much to offer. So I wanna make sure that gets into the hands of our community as well. So thank you again, Annie, for coming on today, and we'll talk to everyone again soon.
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