1937: The January Financial Wrap: Lessons to Carry Us Into the Year

Summary

Podcast Summary: So Money with Farnoosh Torabi

Episode 1937: The January Financial Wrap: Lessons to Carry Us Into the Year
Date: January 28, 2026
Host: Farnoosh Torabi

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Overview

In this solo episode, Farnoosh Torabi reflects on January 2026—often a reflective and challenging month in financial lives—and distills key lessons and themes from recent episodes and her own experiences. She revisits standout interviews with personal finance leaders, addresses practical money questions, and discusses the broader impact of current events. The episode emphasizes intentionality, honesty in financial self-assessment, and the value of agency and stability, especially during periods of change.

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Key Discussion Points & Insights

1. The Weight of January and Midlife Money Reflections

Timestamp: 05:00–11:00

• Farnoosh candidly discusses why January feels particularly heavy: “It’s reflective, it’s aspirational. It’s when everyone is asking big questions about money, work and security. But this January feels especially heavy for a lot of reasons.” (05:44)
• She shares personal considerations as she approaches midlife, questioning whether constant financial acceleration is still necessary: “I'm turning 46 next month...I've kind of been like on this hamster wheel of saving a lot of my money...I'm just wondering what would happen if I kind of released my foot off the gas a little bit...” (09:13)
• Farnoosh highlights the importance of maintenance and stability over perpetual striving, particularly for caregivers and those with multiple life responsibilities.

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2. Building Intentionality and Financial Agency

Timestamp: Throughout

• The core theme emerging from January’s episodes: “A lot of what it came back to was this idea of intentionality, being honest about where you are in your life. Not the one you're supposed to be in, but the one you're actually living.” (07:06)
• Farnoosh encourages listeners to view stability as “progress,” especially when balancing careers, family, and caregiving.

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3. Revisiting Standout Interviews

a) David Bach & The Power of Automation

Timestamp: 11:00–19:00

• Farnoosh shares a full-circle moment with David Bach, author of The Automatic Millionaire, whose advice on “paying yourself first” and investing early shaped her financial journey:
  • “Honestly, it was two things. It was paying myself first...and investing. I didn't think that I had the capacity to invest. I thought that I had to wait until I was making more money.” (11:47)
• Personal anecdotes underscore the power of simple, automated systems—a theme that resonated deeply for Farnoosh in her twenties:
  • “...you gave me permission to go in that realm. And I started investing in my 401k...That literally set me up for so much success. It gave me the confidence.” (12:28)
• The emotional impetus: “I was afraid...of arriving at a place in ten years and going, what was it all for? I have nothing to show for it.” (13:53–14:06)

b) Jesse Mecham & Budgeting for Agency, Not Restriction

Timestamp: 19:17–27:04

• Jesse Mecham, founder of You Need a Budget (YNAB), shares foundational budgeting advice:
  • Practical first step: “Pull up on your phone and look at the balance of your checking account and write it on a piece of paper. And then below that number, write down what you will spend from that pile and where you will spend it...make sure that every one of those dollars...has a job.” (22:51)
• On the myth of income vs. spending:
  • “My audience is not for people that are truly living at poverty level...Most people, they will solve their money problem by earning more. I have countless examples of people that earn so much money and are so stressed about their money...Worry, worry, worry...So we solve it now. Solve it first by getting their spending right.” (24:03–25:20)
• Definition of being “good at money”:
  • “If you are good at money, you do not worry about it...If you're bad at money, inconveniences are emergencies. And when you're good at money, emergencies are inconveniences.” (26:09)
• Farnoosh’s takeaway: “Budgets are not about restriction, they’re about awareness...give yourself agency instead of judgment.” (27:04)

c) Patricia Roberts & The Realities of College Costs

Timestamp: 27:30–37:45

• Candid talk about the ROI of college and the emotional and practical dimensions of taking on debt:
  • “I still do believe education is worth it. But I don't think college is the only path after high school. I think there are so many other routes...” (32:27–32:55)
• On emotional spending and parent/child expectations:
  • “Oftentimes emotion gets in the driver's seat...it’s really not a dream when your child comes out with 10, 15, 20 years...of student loan debt.” (33:40)
• Guidelines for responsible debt:
  • “I've heard professionals say not to borrow more than what your first year salary would be.” (37:00)

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4. Reflections on Current Events & Broader Systems

Timestamp: 37:45–41:00

• Farnoosh addresses recent troubling events in Minneapolis. She amplifies business journalist Andrew Ross Sorkin’s call for systemic accountability:
  • Sorkin: “When you have circumstances like this now two times in three weeks, where clearly things have ended tragically and terribly...most business leaders stand up and...say we need to rethink how we’re doing it...I think this is one of those moments.” (39:36)
• Farnoosh’s call: “I wish that business leaders would be more vocal about what we're witnessing...I think we need to hear more and louder.” (40:59)

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Notable Quotes & Memorable Moments

• David Bach’s impact:
  • “No one cares about your money more than you. And that switch went on in my early 20s...” – Farnoosh Torabi (14:00)
  • “If you are good at money, you do not worry about it...When you’re good at money, emergencies are inconveniences.” – Jesse Mecham (26:09)
  • “It’s not always constant acceleration. It’s about...fulfilling various buckets at the same time and recognizing that just maintenance is a win.” – Farnoosh Torabi (09:41)
  • “Oftentimes emotion gets in the driver’s seat...but it’s really not a dream when your child comes out with...a nightmare of student loan debt.” – Farnoosh Torabi (33:40)
  • “Training...when you have circumstances like this now two times in three weeks...most business leaders stand up and...say we need to rethink how we’re doing it.” – Andrew Ross Sorkin (39:36)

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Timestamps for Key Segments

• Intro & January Reflections: 05:00–11:00
• Thematic Recap – Intentionality & Midlife Money: 07:06
• David Bach Interview Highlights: 11:00–19:17
• Jesse Mecham (YNAB) on Budgeting: 19:17–27:04
• Patricia Roberts (College Planning): 27:30–37:45
• Andrew Ross Sorkin & Social Accountability: 39:36–41:00

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Tone & Style

Farnoosh is candid, empathetic, and practical throughout. She reveals personal vulnerabilities and lessons, fostering a supportive, non-judgmental atmosphere. Her commitment to equity, agency, and data-driven empowerment runs through the discussion, making the episode especially resonant for listeners navigating complex financial and societal terrain.

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Recommended for listeners seeking honest, actionable financial wisdom, stories from top personal finance experts, and reflection on current events impacting financial security and well-being.

Transcript

[Farnoosh Torabi]

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[Guest or Sponsor Voice]

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[Farnoosh Torabi]

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Welcome to SEW Money. Welcome back to SEW Money everybody. I'm your host, Farnoosh Tarabi. Before we get into the show today, I want to quickly share something I'm really excited about. So I just wrapped a live investing workshop for my so Money members. It ran two hours. It was supposed to be an hour. Two hours. It was so long, my computer actually crashed in the middle of it. It was like, what are you doing, you crazy woman? Luckily the crash was only nine seconds and I was able to get back into the zoom and everybody was still there. And some people didn't even notice. They were like, hello, what's going on? I can't see the slides anymore. And I made it back and it was a marathon. But we had so much to uncover. We were talking about what to do with our money in 2026, where to put our money, how to make it grow, what to do if we're scared, how I have managed my money over the last 25 years, the time I rebalanced my portfolio, why I did it, and we answered people's questions. It was a lot. And I thought I was just taking up so much of their time, but thankfully that I was doing it. January, it's been a lot, right? And we're going to get into some of the things that January taught us so far. It's January 28, 28 days in and my so many members club. It's a very. We're a small group and I like to keep it tight. I don't have thousands of people in this group. It's not even hundreds of people. It's a very intimate group, toe to toe with you in your financial life. I'm in there every day, as much as you need me answering your questions. I host live workshops every month. Not every time it's two hours, but when it's important, I take my time. I do office hours. If you're looking for accountability this year, if you want a financial advocate, a friend. And not just me, the members themselves. We're a lovely bunch, a caring bunch. We're good people and we're in some ways taking care of each other, at least looking out for our financial well being. We ask each other questions, we jump in, we give resources. It's not overwhelming. We're not sending you texts and messages and alerts all the time. It's a light touch. I recognize we're all very busy. People don't always come to the live events. A lot of times people are just learning on their own time and pace and I respect that. But if you want to see what I taught last night, it's available to you. Everything is logged in our library, so you can go to somoneymembers.com and subscribe. This is something that I've reserved behind the scenes. In addition to this free podcast, there's also this monthly membership. I've been doing this for a couple of years. It's been a delight for me to have this access to our audience in this way and I invite you to join if it's something that you're interested in. All right, onto today's show. This is a solo show. No guest, just me. I haven't done this in a long time. Partly because of the snow that we experienced over the weekend. My schedule completely went off the rails this week. And I was not able to put together a guest interview this week. But also because as I was thinking about what to make of today's episode, it hit me. It's January 28th. We're at the end of the month, and January is always heavy. It's reflective, it's aspirational. It's when everyone is asking big questions about money, work and security. But this January feels especially heavy. But this January feels especially heavy for a lot of reasons. So I thought, let's pause and recap. And let me, let me drive this. So what have we actually learned this month? We've had a number of exceptional guests. I've been so, so lucky. We've been all lucky to hear from some of the biggest names in personal finance. We've covered financial planning on the show, budgeting, investing, real estate, and long term. Think if I took a big giant step back, there was a theme for sure. There was definitely a through line. And for me, and I'm curious what you thought, but for me, a lot of what it came back to was this idea of intentionality, being honest about where you are in your life. Not the one you're supposed to be in, but the one you're actually living. And I've also been thinking about midlife money check ins. In fact, I'm seriously considering teaming up with a financial planner to do a special episode or workshop just on this because I keep hearing the same questions from everybody, from you, from friends, in my voices, in my head, you know, like, are we optimizing for retirement or just winging it? Do we actually have enough in savings? Could we retire at 60? Is that just a fantasy? Can we maybe stop contributing to certain accounts, like the college savings plan or even our retirement accounts, and just coast? I've been curious more about coasting, financial coasting. I'm turning 46 next month and I don't know, I've kind of been like on this hamster wheel of saving a lot of my money, investing a lot of my money. And I've been very diligent about all of that. And I'm just wondering what would happen if I kind of released my foot off the pedal, if I release my foot off the gas a little bit and asking, not like, how much more can I save, but what have I Already set in motion. That's what I'm curious to ask a financial planner. Can I let compounding do some of the work for me now? Like how much can compounding do for me at this point that I can maybe take a backseat? I've been maxing out my SEP IRA for like a decade. Can I redirect some of this income to something else? Can I afford to take my foot off the gas just a little bit? Because, you know, we have a lot of competing expenses. We have a home that needs repairs. As I'm recording this, there is a guy on my roof who's probably going to tell us we need a new roof. And could I, instead of maxing out my SEP IRA this year, put some of that towards a new roof? You know, it's making me life right now is making me think differently about what financial success looks like in midlife. And it's not always constant acceleration. It's about like fulfilling various buckets at the same time and recognizing that just maintenance is a win. Stability is progress, especially for caregivers, especially for anyone carrying a lot of the invisible labor in their homes. But these questions are pretty practical and they tend to show up when you're juggling a lot, including kids, aging parents, careers that are peaking or shifting. And that brings me back to how we kicked off the month we started January with a sit down conversation with an OG in personal financ. Know him, David Bach. And this was a very full circle moment for me. David is one of those voices in personal finance who's influenced millions of people. But he's also somebody whose advice very directly influenced my own life in a major way. I remember being 23, 24 years old at my desk. I was a business producer for New York 1 NEWS in New York City. On all of our desks in the newsroom, we had these small little televisions. At 4 o', clock, everyone's televisions mostly was tuned to Oprah on mute, but we would catch Oprah. And this particular day, I remember I caught a guy named David Bach and he had a book out called Automatic Millionaire. And I was covering personal finance and the economy and business for the station. So I was naturally tuned in and interested in what he had to say. And I turned to my anchor at the time, Annika Pergamen, and I said, we gotta book him. Like if he's gonna do a book tour, I would love to get him on New York 1 and meet him and share his advice to New Yorkers. He's talking all about the power of automation and this idea of the latte factor and how we spend money on coffee and all these, like, little expenses and how they add up. And it was just really refreshing ideas about how savings can be meaningful. I just thought his advice was really accessible. But I also really loved that he was giving us permission. And I think that's what, for me, I really needed at that moment in my life was permission to stop chasing perfection and just simplify my financial life to, you know, to not wait for someday, but to just start doing something that would actually move the needle in my financial life in meaningful ways, to automate the basics. I didn't really think that that would be powerful thing, but the idea that you can kind of create a system for your money was a very new idea in my head, and it really clicked. Here's actually a moment from that conversation with David that talks about how he basically changed my life and got me to really take my future more seriously and how I was pretty scared in my 20s. If you're in your 20s listening, maybe you can relate that you're just like, when will my life ever get real? I have debt. I'm not making as much as I'd like. I want a big life. How do I get from here to there? Take a listen.

So let me ask you a question.

Because you said this book impacted you.

And I'm always curious, what was it.

[Guest or Sponsor Voice]

That impacted you and what made you make changes?

[Farnoosh Torabi]

Honestly, it was two things. It was paying myself first, which I was not doing in my 20s. I was paying everybody else and myself last, and investing. I didn't think that I had the capacity to invest. I thought that I had to wait until I was making more money and that I wasn't taking myself seriously as an investor. I was somebody who was earning, paying off her debt and spending and saving a little bit. But investing, my gosh, that was like a very graduated concept to me. And you gave me permission to go in that realm. And I started investing in my 401k. I started earning the match that same job that I was at where we met. I started investing in my 401k there. When I left, I had about $30,000 in a retirement account in my early 20s. If you had asked me to do this on my own willpower, never. I'm not kidding. I mean, what more do you want to hear? That literally set me up for so much success. It gave me the confidence. So when I went into the next job opening up a 401, not anything I questioned. Absolutely. Sign me up. Let's double down. And. And as I also started to get more into the world of personal finance as an expert, I asked you to endorse my first book. You said yes. It was like the quickest reply I ever got to an email, which for anyone who knows when you're going out for blurbs for your worst, it's the worst. And no matter how many books you've written, no matter how successful you become, that ask just feels so gutting to me. At least, by the way, to me, too.

[Guest or Sponsor Voice]

Yeah.

[Farnoosh Torabi]

It's just, you don't want help. You want to feel like, can do this all on your own. There are gracious people out there. And then I started to really just love you as a person. I was like, he's not only a great expert, he's like a good human, which, you know, you walk this earth. It's not always the combination.

I really appreciate that, and thank you.

For sharing all that. I think the thing I'm curious about.

I'm always curious what makes somebody make the decision? Because to me, lots of people hear.

Me on podcasts or read my books.

And then it's the. There's the difference in people's lives are a result of.

[Guest or Sponsor Voice]

Did they make a decision?

[Farnoosh Torabi]

I was afraid, I will say I wrote a book about fear, the healthy state of panic. I think I was really afraid of arriving at a place in 10 years and going, what was it all for? I have nothing to show for it.

[Guest or Sponsor Voice]

Oh, God, that's so good.

[Farnoosh Torabi]

Like, I really. I had you fast forwarded 10 years. Yeah.

[Guest or Sponsor Voice]

See, I think, oh, it's so good.

[Farnoosh Torabi]

I would see women in my office get pregnant, David. And then never come back to work. And have nothing in savings. And have nothing in savings. And feel as though they just lost all this momentum. They couldn't negotiate, they had no financial power. And I didn't want to be in that compromising situation. I knew I wanted a family and I wanted a big career. And I knew something you said very early on is, it's your responsibility to protect your finances. No one's going to show up at your door and say, here's how you should do it, and here, let me do it for you. No one cares about your money more than you. And that switch went on in my early 20s, listening to you and just reading a lot about personal finance. And I just realized, like, I'm afraid so the best way to meet this fear and relate and have a relationship with it that's healthy is to start answering questions for myself, start making some moves, little ones, little steps, little ones. I don't have to change things overnight, but compounding, oh my God, that power. Here's the thing about New year's resolutions. Nearly 80% of them fail by February. And it's not because people lack willpower. It's because they lack data. Real, lasting change starts when you actually understand what's happening inside your body. Things like hormone imbalances, inflammation, thyroid issues, even how your body responds to stress. These hidden factors can quietly derail your health goals before you even know what's going on. This year, I'm focused on reducing stress and strengthening my body and mind, not through guesswork, but with real data. And that's exactly why I chose Function. Function is the only health platform that gives you access to over 160 lab tests looking at hormones, metabolism, heart health, inflammation, stress markers, and even toxins. You can also add MRI and chest CT scans, and everything is tracked in one secure place over time. It's a level of insight most people never get. There's a reason top health experts like Dr. Mark Hyman and Dr. Andrew Huberman are behind it. When you stop guessing and start measuring, everything changes. So this year, don't rely on guesswork. Get your data, track what matters, and make health decisions based on your biology. Once my lab results are in, I can't wait to learn my biological age, which will hint at my true rate of aging and risk for disease. Own your health for $365 a year. That's a dollar a day. Learn more and join using my link. Visit functionhealth.com somoney or use the gift code SOMONEY25 for a 25 credit toward your membership? I'm Farnoosh Tarabi, host of so Money, and this episode is sponsored by GT Feeling like your CPA is always one step behind, causing you to miss valuable tax advantages? Questioning if your tax plan is truly as optimized as it should be? That's where GHELT comes in. GHELT is a tax planning and strategy solution for you and your business. They're the modern alternative for entrepreneurs who feel like their CPA is reactive, not tech forward, and maybe not asking the bigger strategic questions about how your business is growing. What I love about GELT is this they make taxes part of the business plan. With gel your partner in taxes, CPAs and AI align your tax strategy to how your business grows. That includes the real levers that matter choosing the right entity structure, maximizing retirement contributions, and uncovering hidden credits and deductions, all handled alongside your business and personal compliance and GHLT is proactive. Your tax strategy gets revisited every quarter by a dedicated cpa, not just a tax time. No more slow replies, no more surprises, no more spreadsheets and email chaos. Just a slick dashboard, clear next steps and year round support. Schedule a [e-mail] today and learn how your taxes can become a lever for growth. That's joing.com and schedule your discovery call today. Farnoosh tarabi listeners get 10 10% off their first year of service. Just mention my name on your intake form.

[Guest or Sponsor Voice]

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[Farnoosh Torabi]

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[Farnoosh Torabi]

That's ironcladapp.com podcast David's book the Automatic Millionaire is now actually in its 20th year and this January he re released it with some updates and that's actually what brought him to New York. He's living in Italy right now with his family. He moved there during the pandemic and we talk in that conversation too about what his new life in Italy has taught him about building wealth and what he's trying to bestow onto his sons about the meaning of money and, you know, all that important stuff. It was just for me a really I'll cherish that interview for the rest of my life and I hope that David will come back. But I think he was saying this was kind of his last interview tour for his book and I was just honored that he made so many one of his first stops on that tour. One of our other big episodes in January was with Jesse Macham and he is the founder of youf Need a Budget which if you don't know about you need a budget, you gotta know about you need a budget. Ynab, as we call it, and it's been around for over 20 years. This has been a go to resource for so many people looking for smart budgeting systems. For a long time it was YNAB and Mint, and then Mint went away and so now it's YNAB and bunch of other softwares out there. Of course, YNAB is not the only one, but it's been around for probably the longest and I wanted to understand why. And Jesse is biased, obviously, he's the founder, so he's gonna speak very positively about it. But it's the track record speaks for itself. And in fact, just before Jesse came on the show, I was watching Good Morning America and Good Morning America and one of the anchors just said, very honestly, she said, I love ynab. I use it. My husband and I got married. We use it to kind of get squared away with our finances, get our budget figured out so we can start accomplishing our goals. People who use it, they swear by it. And it's not for everybody, of course, and Jesse will say that too. It's not for everybody, but it's. It's working for a lot of people. And budgeting is not fun. And Jesse actually admits to not liking this word, which ironically is in the title of his company. But I wanted to start the year with this topic because love it or hate it. Budgeting. And love the word. Hate the word. It's an important topic. And some people like to call it a spending plan. It's important to know where your money's going, and it's important to align your spending with your values and your goals. And that is essentially what budgeting is. So in this conversation, I want to share a little bit of it so we can remind ourselves of why budgeting is important. But here, specifically, Jesse talks about the patterns that he sees with his most successful budgeters. I wanted to learn more about the behaviors of his budgeters and like, what are the wins and what are the patterns? All to encourage people to do this, because I know it can be an uphill battle sometimes. Take a listen. Quick advice. If someone feels just a little like the January train has left the station, they're not on it. They want to be. They want to get onto some financial goals this year. Budgeting topping the list. What's something they can do to ease into it starting this week?

[Guest or Sponsor Voice]

Oh, yeah, pull up on your phone and look at the balance of your checking account and write it on a piece of paper. And then below that number, write down what you will spend from that pile and where you will spend it. Like I'm going to spend a hundred dollars for gas. I'm going to spend a hundred dollars for groceries at 3pm after bus pickup or whatever. And you're going to keep going and make sure that every one of that, those dollars in that pile of money, I don't care if you have 300 or 300,000. It's the same, same job that will help you feel so in control and you will feel like you are acting, that you are take like you are asserting your will in the world. That's what we want. So start there, see how it feels and then recognize that there's an app that you do the same thing over and over again for the rest of your life. So you know exactly what your money is for that precious, lovely resource. Yeah, but don't. You can start right now. There's, there's January's arbitrary. Right. Start when we start. And then the, the key is just, just keep going. Yeah, just keep asking that question of what job do these dollars need to do?

[Farnoosh Torabi]

You know, you know that expression, you don't have a spending problem, you have an income problem or you don't.

[Guest or Sponsor Voice]

Such a lie.

[Farnoosh Torabi]

You think so? Okay, yeah, let's, let's hear your TED Talk on that.

[Guest or Sponsor Voice]

Well, my audience is not for people that are truly living like at poverty level or I mean the poverty line is way understated anyway. So my audience at ynab, we, we are not talking to those people. Those people know how to stretch a dollar way beyond my abilities. Most people, they will, they will think they need to solve. They, they will solve their money problem. They'll get good at money by earning more. And I, I have countless examples of people that earn so much money and are so stressed about their money, they are still worried about their money. And our, our definition internally is if you are good at money, you do not worry about it. And so that's my gauge. And I, I can just show you across all income levels. Worry, worry, worry, worry, worry all the way down. And so we solve it now. Solve it first by getting their spending right. And then you're like, Jesse, but what if they want to earn more? My have. Go for it. I love that. I love when people earn a ton of money. I love the entrepreneurial stuff. But first solve the spending. And then let's, let's look at the other thing. It's, it's such a Mirage. When they're like, oh, if I just earned more. And I'll. I did this with these business owners the other day, earning so much money. And I asked them, I'm like, do you earn more than when you were 30? They're like 40s, 50s, 60s, and they're just like, they're all like, like sometimes 10 times more. And I was like, are you more or less worried about money now than when you were 30? Most of them were more worried. And so it really is about learning to be good at it and then, yeah, earn all you want, but learn to be good at it first.

[Farnoosh Torabi]

Is there some freakonomics variable to knowing if you're good at money? Like, if you track this one thing and this is what it tells you about whether or not you're good at money. Like, often we will track, you know, our credit card statements. Is it less or more than last month? Okay, if it's less, I'm good at money. But actually it's this thing. I want to know what's your.

[Guest or Sponsor Voice]

Like there's like some kind of heuristic that would be really telling, ooh, people.

[Farnoosh Torabi]

Who are really good at money. People who are really good at money, they, they spend more or less in this area and it's, you know.

[Guest or Sponsor Voice]

Yeah.

[Farnoosh Torabi]

Consistently this thing.

[Guest or Sponsor Voice]

As far as the numbers go, I, I don't know if I could tell you if you're good at money. You don't know when payday is. It's automated. Like it's, you're, you're living, you're not on that paycheck to paycheck train. So it just comes in. If you're, if you're bad at money and you're discussing it with your spouse, it is, there's tension. And when you're good at money and you're discussing with your spouse, there's as. Right. There's creation. It's a different vibe. When you're, when you're bad at money, inconveniences are emergencies. And when you're good at money, emergencies are inconveniences. That's a good one. If you're bad at money, when you spend, you feel a little bit of guilt, a little second guessing. And when you're good at money, you feel, I don't mean just a dopamine hit. We got to get past that every time for both parties. But when you're good at money, you feel joy, you feel contentment, you feel the same even. So they're like touchy feely in a lot of ways.

[Farnoosh Torabi]

I Love what Jesse said about how budgets are not about restriction, they're about awareness. It's about knowing where your money is going before it's gone. There's a saying at YNAB that, you know, you would give every dollar a job, so give every penny, every dollar when there are no more pennies, right? Give every nickel a job. Give yourself agency instead of judgment too. I think that's the other thing about budgets that we don't like, right? They brew this bit of judgment in us, in ourselves, that, you know, we shouldn't do this, we shouldn't do that, we feel guilty about spending on this and that we compare our budget with other people's budgets and that's just so toxic. So get away from doing that. Let this interview teach us that. And walk into 2026, erasing that from your mindset and use your budget to permit yourself to have agency over your money. What a shift now also, just this week I sat down to have another important conversation over a topic that is keeping a lot of families stuck and stuck, not just for a little bit, but for a long time. And that is the cost of college. My guest, Patricia Roberts joined. She's the Author of Route 529. She's been on the show many times and for good reason. She's one of the country's leading experts on College savings, specifically 529 college savings plans. She has such a grounded long term perspective to college financial planning and that's why I love having her on. And we talked very candidly about the cost of college. Is there an ROI anymore? How to be a long term thinker when it comes to choosing your school. And in hindsight, I'm so glad that I went to Penn State and didn't come out with any debt as an undergraduate and didn't have any undergraduate degree debt. Although I did get into some debt when I graduated from Columbia and got my master's in journalism. But at the time When I was 17, I was all high hoping and wanted to go to big name schools, elite private schools. And my father basically stopped me dead in my tracks. And he said, unless you get a full ride or close to it to some of these schools like NYU and Northwestern, we can't afford it. And I don't recommend student loans. And this was against the advice of all my teachers, all my guidance counselors, my friends, parents even who were taking out student loans and my friends who were taking out student loans. This was just what you did back in the late 90s. It was the beginning of the student loan blitz, I suppose. And my father, who had a Ph.D. did all of his studies debt free. Now to his credit he got scholarships and that wasn't what was expected of me. But he was just not familiar with this concept of taking out debt for education, at least not at the undergraduate level. He was like, wait a minute. Undergraduate degrees are pretty much a commodity in this country. It's only when you get to the masters and the graduate level that your education really gets precise and where you go really matters. I guess coming from a family of academics, that's debatable, I guess, but that's his opinion and, and that was what I was being fed. So I didn't agree. There was a lot of debating going on at the time. I cried, I was very upset. I got into some of those schools that I really wanted to go to and couldn't because of the cost and I even got some aid, but it wasn't enough. And so I went to Penn State. My parents could bankroll it. It was at the time I was an in state resident, so I was paying something like my parents paid something like eight, nine thousand dollars a year. I got even a little bit of a scholarship. So in hindsight, thank God, right? To not have four years of debt from college. And that's my advice now to everybody. Go where you are loved and not just where they're going to roll out the academic red carpet, but also the financial red carpet for you. Here's a little bit from my conversation with Patricia. The tragedy is that you don't have any savings for your child's college future. And what happens, A lot of parents take out of their own retirement, they sacrifice their own finances or the child takes out severe loans. And right now what are you hearing most from families and students too? I'm hearing a lot of is college even worth it? I could save for my kid, of course, but with everything that's shifting, the landscape is shifting, job market, our colleges really turning out job ready students. Given that the pace of the market is moving faster than academia is and some colleges are keeping up and others are not. The one you go to now matters more than ever. But of course there's a price to that. What is the roi? I'm just trying to see what are you hearing?

Yeah, I'm hearing the same and fair enough, the cost is high, the return on investment not always clear. Particularly when we're hearing students, recent graduates, even a year or two out are not necessarily getting jobs or getting jobs in the field that they were hoping what I talk to parents about all the time is that I still do believe education is worth it. But I don't think college is the only path after high school. I think there are so many other routes that can be considered. I hope you and I will talk about some of the recent changes to 529 that allow them to be used for much more than a traditional college. Even beyond trade and technical school, for some certificate programs, for some other non degree credentials. I think families need to be thoughtful about where they spend the money. Whatever they've saved. I think they need to be really thoughtful on the spend down. Oftentimes emotion gets in the driver's seat. As the child gets closer to those college years, they get their heart set on a dream school or two. Parent remembers they've worked so hard to get there and they want to do anything they can to let them go. But the truth is it's really not a dream when your child comes out with 10, 15, 20 years of really what can be very much a nightmare of student loan debt. So I think people need to think about what they're doing with the money, consider themselves consumers and really think of alternative ways, particularly if the family doesn't have the money and doesn't want to go into considerable debt. Think of alternative paths to get there because you can certainly start at a lesser cost school and ultimately transfer. You can live at home. Maybe it's not the dream to be living in adults and live at home and commute. There are things that can be done and I think families and students really need to be more realistic because it's not just about these two, three, four, five years. It's about the lifetime that the child will live and what the, the parent's quality of life will be later on given whether they do or don't go into considerable debt for that child.

What do you think is a decent amount of debt? One that's not going to derail you. You talked about a hundred thousand dollars, took you 20 years to pay it off. And that is I think very typical. Now $100,000. And it was just hearing about a distant relative who got into college recently. And at first they cast it as this like huge success. She got in on a partial scholarship for a sport where now at this college she's, she's like an athlete student and she's getting like private tutors on the road when she goes and she competes. It sounded very fancy and oh wow, there's a scholarship involved and she gets a special nutrition plan and she's having A great time. And then I asked, just curious, how much does the tuition cost and what is that scholarship? They said it's about a 50% scholarship. I said, that sounds great. What is the remainder? And they said she still is going to own about $50,000 a year. So I'm doing the math. And my heart sank for this person. I thought, unless, and this is not a sport where she's going to graduate and go play professional in this sport and make a ton of money. And I don't know what she's studying, but can you imagine being 22 years old with $200,000 in debt and you don't even have a job yet? And I don't know if you've thought about this. If you're seeing what seems to be like a quote unquote responsible amount of debt that families are taking on.

One of the rules of thumb has to do with, first of all, what type of career are you pursuing? I think the answer may be somewhat different depending on what the ultimate end goal is. I studied philosophy and political science. I don't know what number anybody would put on those two degrees. I loved them. I learned so much. I wouldn't trade that education for anything. Certainly it's led to other things with me. Law school was one advocacy, another. But I would say what you're studying really matters and the projected earnings for that field. Now, keep in mind, people change their mind all the time. You might be going in and signing that note thinking you're going to be a physician's assistant, and then you change your mind. You really like that art major that has appealed to your inner creative. Right. I think you have to think about what the earnings may be. There are calculators or there used to be called. They're called slope calculators. I'm sure a variation of this still exists. Student loan over projected earnings. There was calculators where you could figure out what seems reasonable. I've heard professionals say not to borrow more than what, what your first year salary would be. I don't know for certain what the rule of thumb is anymore, but I think people really need to think about where they're living. Like, we live in New York City. My son has an apartment in Brooklyn, New York. You lived in Brooklyn? Farnoosh. That's not inexpensive. So with or without student loan debt, I think it does matter. What you're going to be studying and where you intend to live can be part of it, but certainly not taking out more than. I like that. That rule of thumb about the first year salary.

Patricia's book again is called Route 529. That episode aired just this week. Before I go, I do want to talk about the deeply troubling crimes we've been seeing reported out of Minneapolis. This is all part of what we've been experiencing this month in January, as I was kind of referring to a bit of it in the beginning, as I was referencing the heaviness of January. There's a lot to say about it, and I want to be thoughtful here. I don't want to oversimplify it, but I do want to share something that really has stayed with me. I've been communicating behind the scenes with a friend who lives in Minneapolis who's just been sharing the terrifying days of living there. And actually, more than one friend. It's been a couple people who've been reporting on the grounds there behind the scenes and telling me a little bit about just how scary it is to drop their kids off at school and go and eat in a restaurant. And I was scrolling the other day on Instagram because it's what we do now, right? It's just hard to not to distance yourself from this. It's like you want to, but you also can't help to not see it. And part of you wants to see it, right? You have to. You want to feel connection to what's going on. And I follow Andrew Ross Sorkin. He's a New York Times columnist, He's a CNBC anchor. He's a prolific author, and most recently he published this book called 1929. It's about the historic stock market crash. He's a journalist. And what he said recently, publicly, on camera, he shared on Instagram. And I really appreciated it. I thought it was just so well said. He talks about accountability and systems and responsibility. And it really stayed with me, and I wanted to share it with you wherever you fall on this topic. I think his point is hard to argue with.

[Guest or Sponsor Voice]

I think there's a larger question that I just want to raise this morning about, you know, when the business community can and should speak out about things that they believe and are seeing with their own eyes as deeply troublesome. Even if you believe that these officers were scared for their lives and acting in good faith in that moment, it is clear that the training that they have that has led to this situation is problematic. And I use the word training because I think that's a word that the business community understands. Business meeting trains its employees. And I think when you have circumstances like this now two times in three weeks, where clearly things have ended tragically and terribly. Most business leaders stand up and they press the pause button and they say we need to rethink how we we're doing it. That's not to say we shouldn't be dealing with illegal immigration. It's not to say we shouldn't be dealing with folks who assault others. But clearly what is happening is not working. And I am, I would just call, literally, if you are watching this and you are a CEO watching this for, for folks to, to raise their hand. And I know people are scared of raising their hand and I think it can be done collectively as the chamber did. But I do think there's an opportunity. I think this is one of those moments.

[Farnoosh Torabi]

That's Andrew Rasorkin from cnbc. And yeah, training. Talk about lack of training, to say the least. I wish that business leaders would be more vocal about what we're witnessing with our own eyes and what we're hearing with our own ears. They're saying some things, you know, they're saying how disapproving they are of what they're seeing in Minneapolis. But I think we need to hear more and louder. Thank you for being with me here. Thank you for being part of this community. Thank you for letting me think out loud with you. I'll see you on Friday. I'm going to be answering your money questions and you can still send them in. Go to Farnishitsomoneypodcast.com, email me there. DM me on Instagram. I hope your day is so money.

[Guest or Sponsor Voice]

Foreign.

[Farnoosh Torabi]

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[Guest or Sponsor Voice]

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