Podcast Summary: So Money with Farnoosh Torabi

Episode 1893: Ask Farnoosh — Smart Budgeting Hacks, Earning More Outside Work, and Tackling Credit Card Fees
Host: Farnoosh Torabi
Date: October 17, 2025

Overview

In this Friday “Ask Farnoosh” episode, host Farnoosh Torabi addresses listeners’ financial questions focused on practical budgeting strategies, earning supplemental income, and navigating costly credit card fees. Farnoosh also discusses trending money headlines, shares actionable advice for anyone struggling with medical debt, and maintains her trademark candid, supportive tone throughout.

Key Discussion Points

1. Money Headlines and Generational Mindsets

• Rise of "Soft Saving" Among Gen Z (05:32):
  • New research shows that over 70% of Gen Z would rather have better quality of life than additional savings.
  • Many are prioritizing living in the present over aggressive saving due to economic uncertainty.
  • Farnoosh empathizes but cautions against dismissing savings entirely:

    "Let's hope for the best. Let's save and invest even just a little... Even 5% or 10% goes a long way. I don't think anyone regrets saving money, right?"
    — Farnoosh, (07:30)

• Financial Grit and Retirement Savings (10:27):
  • Study from Goldman Sachs connects financial grit (persistence, optimism, resisting short-term temptations) to 50% higher retirement savings.
  • Encourages listeners to cultivate grit as a muscle—build small emergency funds to boost resilience.
  • Quote:

    "Financial grit is not something you're born with. It's something you can build."
    — Farnoosh, (11:17)

• PSA for Those Struggling with Debt (12:44):
  • If impacted by events like furloughs or cut hours, call credit card issuers to ask about hardship programs that can offer lower rates or payments.
  • Recommends last week’s episode for deeper debt payoff strategies.

2. Smart Budgeting Frameworks

Listener Question from Lauren — Transitioning from "Every Dollar" Budgeting (18:00)

• Lauren’s Dilemma: She and her husband are tired of tracking every dollar but worry relaxing their approach may threaten their 20–30% savings rate.
• Farnoosh’s Analysis:
  • 30% savings rate is “pretty aggressive” and admirable; wonders if they’re planning for early retirement.
  • Recommends the 50/30/20 rule as a baseline, customized to reflect 30% savings if desired:
    • 50% needs, 30% wants, 20% savings (adjust as needed).
    • Automate fixed-costs and savings first; spend the remainder consciously.
    • Identify and plan for big discretionary expenses through “sinking funds.”
  • Notable Quote:

    "I call that eating your vegetables and then have some dessert. Spend what's left over on things that you want."
    — Farnoosh, (21:40)

  • Encourages embracing intentional spending and celebrating that they’ve avoided lifestyle creep as income has grown.
  • Suggests joining So Money Members Club for deeper dives and ongoing budgeting support.

3. Earning More Outside of Work

Listener Question from Kelly — Using Time Off to Supplement Income (28:05)

• Kelly’s Situation: In her 30s, newly employed in a high-cost Canadian city making ~$70K/year. With two months off annually, she’s considering side income (e.g., online courses) but worries about job conflicts.
• Farnoosh’s Advice:
  • Use part of the two months for rest; extra income is a great goal.
  • Transparency with employer is key—discuss any side ventures early to avoid conflict.
  • Employers often support side hustles, recognizing that financial security at home reduces burnout and improves retention.
  • Practical tips:
    • Start with small teaching/training gigs via LinkedIn, Upwork, etc.
    • Start networking and planting seeds before the break.
    • If immediate income is needed, consider more transactional/short-term virtual work.
  • Notable Quote:

    "Employers, the smart ones, understand that when you are able to make more money and it doesn't cost them anything for you to make more money, it actually benefits their bottom line."
    — Farnoosh, (31:44)

4. Handling Costly Credit Card Fees

Listener Concern — Getting Rid of High-Fee Cards Without Hurting Credit (38:21)

• Situation: Long-time cardholder with a platinum card ($700/year fee). Issuer offers downgrade (still with some fee); listener wants to drop all annual fees but fears closing the account will hurt her credit.
• Farnoosh’s Guidance:
  • Product downgrades (within the same issuer) won’t hurt your credit score; this is called a product conversion.
  • If seeking more value, ask for a retention offer before downgrading—may earn points or perks for staying.
  • Closing the card may cause a minor, temporary dip in credit score, but nothing dramatic or lasting (unless you’re about to apply for a loan or mortgage).
  • Quote (on balancing costs vs. credit):

    "Sometimes our credit scores, we take the hit because...on the other side, it means saving a lot of money or sleeping better at night. If you don't have an immediate need to leverage that credit score, then save your money and open up a card that makes more sense for you."
    — Farnoosh, (43:11)

5. Pro Tip: Handling Medical Bills and Debt (47:00)

• Farnoosh’s Recent Experience: Received a $15,000 hospital bill before insurance review.
  • Did not pay upfront; waited for insurance to process, which reduced it significantly.
• Key Takeaways:
  • Don’t pay medical bills until insurance has processed the claim.
  • Hospitals may pressure you to pay early, but it’s not required.
  • Unpaid medical debt is now treated more leniently by credit bureaus:
    • Debts under $500 are not reported.
    • 365 days to resolve debts before they may appear on your credit.
  • Quote:

    "Why give this company a loan? Then you have to chase them down to get your money back...keep tabs on the bills, but don't feel like you have to pay it immediately."
    — Farnoosh, (48:55)

Notable Quotes & Memorable Moments

• "I don't think anyone regrets saving money, right? And I'm not saying save all your money. I'm saying save 5%." (07:52)
• "Financial grit is not something you're born with. It's something you can build." (11:17)
• "I call that eating your vegetables and then have some dessert." (21:40)
• "Employers, the smart ones, understand that when you are able to make more money...it actually benefits their bottom line." (31:44)
• "Sometimes our credit scores, we take the hit because...on the other side, it means saving a lot of money or sleeping better at night." (43:11)
• "Why give this company a loan? Then you have to chase them down to get your money back..." (48:55)

Timestamps for Important Segments

• 05:32 — Gen Z "Soft Saving" Trend and Living for Today
• 10:27 — Financial Grit and Retirement Outcomes
• 12:44 — Credit Card Hardship Programs and Debt Relief PSA
• 18:00 — Listener Q: Shifting from "Every Dollar" Budgeting
• 28:05 — Listener Q: Using Extended Time Off for Extra Income
• 38:21 — Listener Q: Downgrading or Closing High-Fee Credit Cards
• 47:00 — Pro Tip: Navigating Medical Bills and Insurance

Resources & Further Information

• So Money Members Club: somoneymembers.com (for workshops, office hours, and commercial-free episodes)
• So Money Links: somoneylinks.com (newsletters, blueprints, and curated financial resources)
• Last week's episode for in-depth debt payoff strategies

Final Thoughts

Farnoosh delivers clear, honest financial advice tailored to real-life situations, always with a focus on empowerment and practicality. Her encouragement for intentionality—whether budgeting, pursuing side hustles, or handling debt—makes this episode a must-listen for anyone wanting to level up their financial resilience in uncertain times.