So Money with Farnoosh Torabi Episode 1764: Ask Farnoosh – How to Negotiate Work Benefits, Paying Taxes on a Bitcoin Sale and More Release Date: December 20, 2024

Introduction

In episode 1764 of So Money with Farnoosh Torabi, released on December 20, 2024, Farnoosh engages with her audience through the popular "Ask Farnoosh" segment. As the podcast approaches its 10th anniversary, Farnoosh reflects on personal milestones, celebrates loyal listeners, and announces exciting plans for the future. The episode delves into several pressing financial questions from listeners, offering expert advice on topics ranging from cryptocurrency taxation to negotiating workplace benefits and navigating the job market with an advanced degree.

Personal Reflections and Announcements

Farnoosh begins the episode with heartfelt personal anecdotes, celebrating the birthdays of close friends and family members. She shares plans for the upcoming year, including a renewed focus on involving her audience more directly in the show's evolution. Farnoosh emphasizes the importance of community feedback in enhancing the podcast's content and invites listeners to share their success stories for potential feature episodes.

Notable Quote:

"One thing I have decided, though, is that I want to... understand how the show may be helping you or has helped you go through a financial transition, make a financial move, become more financially empowered."
(00:50)

Listener Questions

1. Paying Taxes on a Bitcoin Sale

   Question from Lori:

   "My mom transferred/gifted bitcoin to me this week worth about $18,000. What is my tax responsibility when I sell this currency?"
   (06:45)

   Farnoosh's Response: Farnoosh explains that the IRS treats Bitcoin and other cryptocurrencies as property, subjecting them to capital gains tax rules. She emphasizes the importance of understanding the cost basis—the original value at which the Bitcoin was acquired. When selling, if Lori sells the Bitcoin for more than the cost basis, the difference is taxed accordingly. Conversely, if sold for less, it may result in a deductible capital loss, adjusted to the fair market value at the time of the gift. Farnoosh advises consulting a tax professional for personalized guidance.

   Notable Quote:

   "Bitcoin and other cryptocurrencies are classified as property for federal tax purposes... the difference is considered a capital gain and it will be taxed accordingly."
   (07:30)

2. Negotiating Work Benefits

   Question from Mary:

   "I'm considering negotiating equity in a small family-owned business. What benefits can I negotiate besides salary increases?"
   (15:30)

   Farnoosh's Response: Farnoosh commends Mary for advocating for herself and details several strategies for negotiating benefits beyond standard raises. She suggests enhancing retirement plans, such as increasing IRA matches, tying bonuses to performance metrics, and exploring profit sharing or phantom stock as alternatives to equity. Farnoosh also recommends professional development opportunities, additional paid time off, and flexible work arrangements as valuable benefits. She emphasizes the power of collective negotiation with colleagues to present a unified proposal to employers.

   Notable Quote:

   "Framing it as, 'I want to stay here, I want to be more invested in this company,' can make your ask more compelling."
   (16:45)

3. Navigating the Job Market with a PhD

   Question from a Recent PhD Graduate:

   "I recently earned my PhD and am entering a competitive job market. Any tips on how to navigate this landscape successfully?"
   (23:15)

   Farnoosh's Response: Farnoosh advises defining clear career goals, whether in academia, corporate, or nonprofit sectors. She underscores the importance of updating resumes and LinkedIn profiles to highlight transferable skills such as research, leadership, and critical thinking. Networking is crucial—leveraging university connections, engaging with alumni, and utilizing headhunters can open doors. Farnoosh encourages embracing the unique expertise a PhD offers and confidently showcasing it to potential employers.

   Notable Quote:

   "Highlighting your transferable skills like research, leadership, and critical thinking can make your PhD stand out in the job market."
   (24:00)

4. Investing in Health

   Question:

   "What are the best ways to invest in our health for longevity, mental well-being, and overall wellness?"
   (29:45)

   Farnoosh's Response: Farnoosh outlines several strategies for investing in health, emphasizing both preventive measures and lifestyle adjustments. Key recommendations include:

   • Preventive Care: Regular checkups and screenings to catch health issues early.
   • Sleep: Prioritizing consistent sleep routines and creating a comfortable sleep environment.
   • Nutrition and Exercise: Maintaining a balanced diet and regular physical activity.
   • Mental Health: Seeking therapy when needed and implementing stress-management techniques.

   She shares a personal anecdote about the physical manifestations of stress and the importance of setting boundaries to improve overall well-being.

   Notable Quote:

   "Creating boundaries is essential. I was working 24/7 without boundaries, and it took a toll on my health and relationships."
   (30:20)

5. Taxes on Whole Life Insurance Policy Withdrawals

   Question:

   "Do you have to pay taxes if you get money from a whole life insurance policy and not a death benefit?"
   (35:10)

   Farnoosh's Response: Farnoosh explains that withdrawals from the cash value of a whole life insurance policy may be tax-free up to the total premiums paid. However, any amount exceeding the premiums could be subject to income tax. She stresses that taxation can vary based on the specifics of the policy and recommends consulting with a tax professional or financial advisor to navigate the complexities.

   Notable Quote:

   "If you withdraw more than the total premiums paid into the policy, that excess may be subject to income tax."
   (35:50)

Conclusion

Farnoosh wraps up the episode by encouraging listeners to engage with the podcast's evolving format and participate in future episodes by sharing their financial success stories. She reiterates the importance of proactive financial planning, informed decision-making, and investing in both personal and professional growth. As the podcast nears its decade milestone, Farnoosh expresses gratitude to her audience and looks forward to fostering a more interactive and community-driven show in the coming years.

Notable Quote:

"When you're more alert and in tune with your body and mind, you make better decisions—not just in finances, but in relationships and personal well-being."
(32:10)

Key Takeaways:

• Cryptocurrency Taxation: Understanding cost basis is crucial for determining tax liabilities when selling Bitcoin.
• Negotiating Benefits: Beyond salary, consider retirement plans, performance-based bonuses, professional development, and flexible work arrangements.
• Job Market Strategies: Define career goals, leverage transferable skills, and utilize networking and headhunters to enhance job prospects.
• Health Investments: Prioritize preventive care, sleep, nutrition, exercise, and mental health for long-term well-being.
• Insurance Withdrawals: Be aware of the tax implications when withdrawing from the cash value of whole life insurance policies.

Connect with Farnoosh Torabi:

• Email: farnoosh@somoney.com
• Instagram: @Farnoosh
• Website: SoMoneyPodcast.com

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Disclaimer: The information provided in this summary is for informational purposes only and does not constitute financial or tax advice. Consult with a professional for personalized guidance.