Podcast Summary: So Money with Farnoosh Torabi Episode 1760: How to Crush $50K in Debt While Saving For Your Future Release Date: December 11, 2024

Introduction

In Episode 1760 of So Money with Farnoosh Torabi, host Farnoosh welcomes Jodi Smith, the creator of the personal finance blog Abundance of Jo. This episode delves deep into Jodi's inspiring journey of paying off $50,000 in debt while simultaneously saving for her future. Listeners gain valuable insights into effective debt management, wealth-building strategies, and the importance of financial education.

Jodi Smith’s Financial Journey

Background and Origin Jodi Smith shares her personal story, originating from Jamaica and moving to Canada to pursue an MBA. This decision led her to incur significant debt, which became a pivotal point in her financial education and eventual success.

• Jodi Smith [04:38]: "I moved up north to Vancouver to do my studies there. I took out about $50,000 in loans. That's a lot of money when you're very young."

Inspiration from So Money Jodi credits the So Money podcast for providing the knowledge and motivation to tackle her debt head-on.

• Jodi Smith [07:18]: "I started listening and I started to put together a plan to pay off this debt."

Strategies to Crush Debt While Saving

Balanced Financial Plan Jodi emphasizes the importance of balancing debt repayment with saving for the future. Her strategic approach involved:

1. Understanding Debt Structure

   • Jodi Smith [31:57]: "First, understand the debt. Know how your debt is structured."

2. Debt Avalanche Method

   • Jodi Smith [34:05]: "Start with paying off the debt that has the highest interest rate so that way you can save money."
   • Farnoosh Torabi [34:08]: "We call that the debt avalanche."

Emergency Fund and Retirement Savings While paying off debt, Jodi also prioritized building an emergency fund and contributing to her 401(k).

• Jodi Smith [10:42]: "I set up a separate emergency fund account and I save and I'm still doing that even to this day."

Building Wealth: Saving and Earning More

Saving Strategies Jodi highlights practical saving techniques, such as automating savings and utilizing high-interest savings accounts.

• Jodi Smith [24:46]: "I focus a lot on giving practical advice like here's how you actually save money. You go to the bank and you open a high interest savings account."

Increasing Income Beyond saving, Jodi stresses the importance of earning more to fund financial goals.

• Jodi Smith [24:47]: "If you don't have extra money to really fund your financial future, it's going to be very hard."

She discusses various methods to increase income, including starting a side hustle or leveraging existing skills to create additional revenue streams.

Negotiation and Earning Extra Money

The Power of Negotiation Negotiation is a critical tool in maximizing income, especially in corporate settings.

• Jodi Smith [25:53]: "I find especially women, a lot of people do not negotiate and they leave money on the table."

Practical Negotiation Tips Jodi provides actionable advice on how to effectively negotiate salaries and raises.

• Jodi Smith [25:56]: "Focus on teaching people how to ask... Simple things that people can do so that they can earn extra money."

Personal Financial Goals and Vision

Future Aspirations Jodi envisions financial freedom that allows her to travel, own a beautiful home, and give back to her community.

• Jodi Smith [26:46]: "I want to be able to travel and see the world... create a legacy."

Creating a Legacy Her long-term goals include establishing a scholarship fund in Jamaica to support education.

• Jodi Smith [16:48]: "I want to start a scholarship fund back home in Jamaica to help people go to school and get an education."

Common Financial Struggles Discussed

Global Financial Challenges Jodi acknowledges that financial struggles like credit card debt and student loans are universal issues affecting people worldwide.

• Jodi Smith [29:50]: "Credit card debt is also a big issue... Another one is the same student loans."

Saving on Low Income She addresses the difficulty of saving money when income is limited and bills are prioritized.

• Jodi Smith [30:43]: "How do I save if I've already paid off all my bills, there's nothing left."

Advice for Overwhelmed Individuals

Know Your Debt Jodi advises listeners to fully understand their debt, including amounts, interest rates, and payment schedules.

• Jodi Smith [31:57]: "Know how much you owe. Know what the interest rates are."

Create a Plan Developing a structured plan is essential for effective debt repayment and financial stability.

• Jodi Smith [32:00]: "Once you have a plan, you make it. Pay off the most expensive debt first."

Debt Avalanche Method Using the debt avalanche method is recommended to minimize interest payments and accelerate debt clearance.

• Farnoosh Torabi [34:08]: "We call that the debt avalanche."

Conclusion and Additional Resources

Empowering Through Education Jodi's journey underscores the importance of financial education and proactive planning. Her blog, Abundance of Jo, serves as a resource for others seeking financial independence.

• Jodi Smith [17:06]: "I started a blog in 2021 and so far it's been growing and I've been able to educate people from across the world."

Encouragement to Listeners Farnoosh and Jodi encourage listeners to take control of their finances through informed decision-making and disciplined planning.

• Farnoosh Torabi [34:09]: "Thank you so much for coming on SO Money. I'm so happy that we're actually connected now, face to face."

Resources Mentioned

• Abundance of Jo: abundanceofjo.com
• So Money Members Club: SoMoneyMembers.com

Notable Quotes with Timestamps

• Jodi Smith [04:38]: "I took out about $50,000 in loans. That's a lot of money when you're very young."
• Jodi Smith [07:18]: "I started listening and I started to put together a plan to pay off this debt."
• Farnoosh Torabi [34:08]: "We call that the debt avalanche."
• Jodi Smith [25:53]: "I find especially women, a lot of people do not negotiate and they leave money on the table."
• Jodi Smith [31:57]: "Know how much you owe. Know what the interest rates are."
• Jodi Smith [26:46]: "I want to be able to travel and see the world... create a legacy."
• Jodi Smith [17:06]: "I started a blog in 2021 and so far it's been growing and I've been able to educate people from across the world."

Final Thoughts

Episode 1760 of So Money offers a comprehensive look into overcoming significant debt while laying the groundwork for a secure financial future. Through Jodi Smith’s personal experiences and actionable strategies, listeners are equipped with the knowledge and motivation to take control of their own financial lives.

For more information and resources, visit abundanceofjo.com and consider joining the So Money Members Club at SoMoneyMembers.com.