1964: How to Ditch Budgeting Overwhelm with The High Five Banking Method

Summary

So Money with Farnoosh Torabi

Episode 1964: How to Ditch Budgeting Overwhelm with The High Five Banking Method
Guest: Sirenise Pierce
Date: April 1, 2026

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Episode Overview

In this episode, Farnoosh Torabi sits down with Sirenise Pierce—financial educator and creator of the High Five Banking Method—to discuss how her personal journey through financial trauma shaped a career in helping others simplify and take control of their finances. Sirenise unpacks why traditional budgeting often fails, introduces her practical five account money management system, and shares tangible strategies for navigating financial instability. The episode is rich with stories, actionable advice, and encouragement for listeners to take back the power in their financial lives, even when the world feels unstable.

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Sirenise Pierce’s Financial Awakening

[03:01–11:02]

• Sirenise shares a moving and personal story of how the 2008 financial crisis affected her family:
  • Her parents, immigrants from the Dominican Republic, saw temporary stability and prosperity unravel: home lost to foreclosure, cars repossessed, and ultimately, divorce.
  • Her father bluntly told her and her sister they were broke and prepped them for encounters with sheriffs and tow trucks.
  • "I started realizing that I was living my entire life based on fear. I picked my first major in college, not because I was passionate...I wanted a recession proof career." – Sirenise [09:13]
• The trauma led her first to a scarcity mindset and later to a drive for independence, as well as a pivot in college from pharmacy to business/finance.
  • "This is my opportunity to take care of myself. If I don't do this, who's gonna take care of me? My parents can't." – Sirenise [12:04]
• She highlights the importance of seeking community and intentionally nurturing growth beyond her immediate environment.
  • "Community really does matter. Who you hang around with, what you're reading, what you're seeing...it does make an impact." – Sirenise [15:18]

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The Roots of the High Five Banking Method

[16:10–18:15]

• Sirenise explains her fascination with diversification:
  • Her parents’ over-reliance on real estate (without an emergency fund or investments) led to disaster.
  • "You really do need to have different diversifications when it comes to your savings, when it comes to your investments, when it comes even to your retirement plan." – Sirenise [17:42]
• These lessons inspired the High Five Banking Method—a system that uses five accounts to give clarity and purpose to every dollar.

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The High Five Banking Method Explained

[18:19–24:21]

• The method consists of 2 checking accounts and 3 savings accounts:
  1. Bills Account (Checking): All mandatory expenses—housing, transportation, utilities, healthcare, debt payments, groceries.
     • "Once you have this account filled up, give yourself a thumbs up, you're doing good." – Sirenise [21:38]
  2. Lifestyle Account (Checking): All non-essential, "fun" spending (eating out, entertainment, shopping).
     • "The more pointing you do, the less saving you can do. So… make sure you control that lifestyle account." – Sirenise [22:03]
  3. Emergency Fund (Savings): For unexpected disruptions—job loss, recession, natural disaster.
     • "Without a doubt, you wanna make sure you have a protection plan...some of that safety net." – Sirenise [22:21]
  4. Short-Term Goals (Savings): Expenses in the next year (vacations, memberships, holiday spending)—designed to "pink promise" yourself not to accrue new debt.
  5. Long-Term Goals (Savings): Expenses 1–5 years away (wedding, home, sabbatical), helps track steady progress without pressure.
     • "Once you have all five accounts, give yourself a high five." – Sirenise [23:58]
• Visual labeling and dividing accounts helps with clarity, automation, and reducing day-to-day money anxiety.
• "When we have a system for our money, we can feel confident that…the responsible things I have to get done are getting done." – Sirenise [19:52]

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Impact on Real Lives and Couples

[27:04–29:55]

• Sirenise describes increased transparency and communication as the top benefit, especially for couples:
  • Partners feel more engaged and enthusiastic rather than anxious about shared goals.
    • "I've also seen a lot of people share that they're accomplishing a lot more goals than they were previously." – Sirenise [27:49]
• The framework creates easier routines—regular "all hands meetings" to review and plan.
• Retirement savings are kept separate to encourage people to see them as investment, not simple savings accounts:
  • "You can't save your way to retirement…If you're someone who doesn't have a company-sponsored retirement plan, you can definitely put money into your bills checking account to transfer to your Fidelity or Vanguard account…" – Sirenise [29:16]
• The High Five system is a framework, not a rigid rule; it should be adapted to fit any stage or size of budget.

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Strategies for Tight Budgets, Cash Flow Issues & “Budget Overwhelm”

[31:07–38:15]

• With inflation and high living costs, many listeners feel squeezed; Sirenise offers practical, empathetic approaches:
  • Cut, Keep, Reduce Strategy:
    • Regularly categorize expenses to know what to cut first in an emergency, what can be reduced, and what must be kept.
    • "At what point do we need to cut, keep or reduce our housing expense? And what options do we actually have?" – Sirenise [32:50]
  • Extend Emergency Fund Runway:
    • By reducing expenses, your savings last longer.
    • "If you do a cutkeep and reduce, and now you're feeling more confident like oh my goodness, we can get through this." – Sirenise [33:58]
  • The Two Week Gap Strategy:
    • Realized during her time working at a payday loan company: most customers had cash flow, not income issues.
    • By building a two-week buffer (via no spend challenge and moving pay dates), you cut reliance on high-interest products.
    • "If they just maneuvered a little differently, that could be changing the due dates on some of their bills, negotiating, doing a reduce, seeing what they can do." – Sirenise [36:49]

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Encouragement to Take Charge and Self-Advocate

[38:20–39:54]

• Farnoosh underscores the importance of self-advocacy:
  • "We think the bill's due when it's due, and I'm gonna get paid when I get paid. And the cost is the cost. And I think we don't say, wait, what if it wasn't that way? Let me call, let me negotiate." – Farnoosh [38:20]
• Sirenise encourages learning, curiosity, and pride in financial involvement for everyone, especially women.

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Book Release, Final Thoughts, and Staying Curious

[39:54–43:35]

• Sirenise’s book, The High Five Banking Method, is out everywhere books are sold.
• She shares the value of systems in all aspects of life, and the importance of adjusting and giving oneself grace for imperfection.
• "You're not always gonna be perfect. And even in my relationship, I'm not perfect…I feel like when you do that, it opens up the conversation to be a little bit more smoother. You're accepting that you're not perfect." – Sirenise [41:14]
• Farnoosh’s signature question—"What makes you so money?"—is answered:
  • "I'm open to learning, I'm open to experiencing new things…You never know everything. Even if you consider yourself a financial expert, you're always learning still." – Sirenise [42:03]
• Special encouragement to women: "It is your place…Take pride in that…and teach your daughters the same thing." – Sirenise [42:55]

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Notable Quotes & Moments

• "My relationship with money, realistically started in 2008. You know how they say you're supposed to learn about money at home? I started learning about money while I was losing my home." – Sirenise [06:08]
• "There's only one way to get out of this. When there's so many ways to survive difficult times. It's not just breaking into your home." – Sirenise [09:46]
• "You can't save your way to retirement…You have to invest the money." – Sirenise [29:16]
• "A lot of people, they're very overwhelmed with the daily responsibilities…and the mental load, it's too heavy. We need to reduce it and get some margin back into our life." – Sirenise [19:46]
• "Even at my lowest points, I still had a lifestyle. It might be $40, but it was still a lifestyle." – Sirenise [30:19]
• "Everything in life is a blessing. How do you maximize? It really shows your stewardship." – Sirenise [43:31]

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Key Timestamps

• 03:01: Sirenise’s 2008 financial trauma, family background, and initial money lessons.
• 09:13: How trauma reshaped her life choices—shift from fear to proactive planning.
• 16:10: The importance of asset allocation and diversification.
• 18:19–24:21: Detailed walkthrough of the High Five Banking Method.
• 27:04: Real-life benefits: communication, ease, and flexibility—especially for couples.
• 31:07: Navigating budget constraints—practical solutions for lean times.
• 33:56: “Cut, Keep, Reduce” strategy for extending emergency funds.
• 35:20: The “Two Week Gap” and payday loan pitfalls.
• 39:54–43:35: Sirenise’ book, living with grace, systems, and the value of curiosity.

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Bottom Line

Sirenise Pierce’s High Five Banking Method offers listeners a simple, practical solution for money management rooted in deep personal experience. This episode is an honest, inspiring resource for anyone seeking to ditch budgeting overwhelm, communicate better about money, structure their way to financial wellness, and stay empowered—even when life feels uncertain.

Transcript

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You're listening so Money with award winning money guru Farnoosh Torabi.

[Sirenise Pierce]

Each day get a 30 minute dose of financial inspiration from the world's top

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business minds, authors, influencers and from Farnoosh yourself.

[Sirenise Pierce]

Looking for ways to save on gas

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or double your double coupons.

[Sirenise Pierce]

Sorry, you're in the wrong place. Seeking profound ways to live a richer, happier life.

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Welcome to SO money.

[Sirenise Pierce]

And it wasn't just our household. In my neighborhood, lots of people were losing their homes, lots of people were losing their jobs, and eventually my parents even ended up divorcing. So I lost more than just a home and a car. Forget that losing your family unit is a huge deal and seeing how deep and how big a recession can impact you, your actual life, on a day to day basis, that's what woke me up and it changed my life. And I realized, you know what, I got to figure out this money stuff because no one's going to come here to save me. And I started realizing that I was living my entire life based on fear.

[Farnoosh Torabi]

Welcome to so Money everybody. I'm Farnoosh Tarabi.

[Podcast Narrator/Host Intro]

You know, there are moments in life when everything you thought was stable suddenly is not. It's when the floor drops out and the plan you trusted no longer works.

[Farnoosh Torabi]

Our guest today had a moment like that that arrived when she was a

[Podcast Narrator/Host Intro]

teenager watching her family lose their home during the 2008 financial crisis. Think sheriffs at the door, cars being repossessed, A life that just months earlier, she says felt secure, unraveling in real time. And what followed wasn't just financial hardship. It was a lot of fear, anxiety, and a relationship with money built on survival. But what's remarkable about our guest, Sirenise Pierce is what she did next. She didn't stay stuck in that fear. She studied it, she questioned it, and ultimately rebuilt her entire approach to money, turning chaos into a system. Today, Cyrenese is a financial educator, speaker and the creator of the High Five banking method, a simple but powerful framework that helps people organize their money with purpose. It reduces financial stress and actually allows them to follow through on their goals. In our conversation, we talk about how financial trauma shapes our decisions, why traditional budgeting often fails for so many. Her five account system that can help simplify your entire financial life and how to create stability even when the economy, especially right now, feels anything but stable.

[Sirenise Pierce]

Here we go.

[Podcast Narrator/Host Intro]

Here's Sirenise Pierce.

[Farnoosh Torabi]

Sirenice Pierce, welcome to SO Money.

[Sirenise Pierce]

Thank you so much for having me. Super excited to be here.

[Farnoosh Torabi]

Yes. Our mutual friend Janice Torres introduced us. Yokito Dinero, podcast host, Shout out to Janiece, she knows the best people. And she said, you gotta speak to Cyrenice. Cause she has an interesting kind of. In the world of personal finance as for as long as I have been reporting on it, it's not often that you come across like way of thinking or a nuanced concept. And Sirenice, you've come up with what's called the High Five Banking Method. This is essentially a book now it's become so popular. I want to get into that, of course, and learn what this is and share that with our audience. But first, as always, we want to know more about you and what drew you to this world of personal finance. Your website's called thepoiselifestyle.com. what's your personal story?

[Sirenise Pierce]

Yes, my relationship with money, realistically started in 2008. You know how they say you're supposed to learn about money at home? I started learning about money while I was losing my home. My parents are immigrants from Dominican Republic. And they honestly, they worked their buns off. They accomplished their version of their American dream. They bought a nice house, a nice car. They were able to travel back home to the Dominican Republic as they pleased, help their family. And it was amazing when the economy was good. But every single time the economy dipped, we felt it. And in 2008, my dad finally sat my sister and I in the front living room, the one that no one ever sits in, and told us very bluntly, we are broke. Don't ask us for lunch money, don't ask us for money for clothes, vacations, nothing. If the sheriffs come knocking on the door, I want you to know that they're here to kick us out. If a towing truck comes around, they're not here to help you fix a tire. They're here to help take the car. We're not making any of the payments, so we really don't have the money. And at this moment, for me, my sister and I, my parents, they raised us on reading a lot of financial books like the Rich Dad, Poor dad, the Richest man in Babylon who Moved My Cheese. And they were very ambitious. And they always told us to manifest what we wanted. We used to cut out pictures from real estate magazines of the house that we wanted because my dad was in real estate. And it was all very positive. But this was the first conversation that it wasn't so positive. And I started building a relationship with my money based on fear and anxiety. I started hoarding money like a crazy person. My friends were even like, okay, you're being a little too tight with Money. And I was trying to save up. I was working, going to school part time at Southwestern Community College and just trying to make ends meet because it was such a tough time. And it wasn't until we finally lost our home when the sheriffs came, kicked my mom out in her pajamas. And the only reason they let her back in the house was because my youngest sister is special needs. And she had to go get her and her medication, all of that. And they told her, if you or anyone goes back in the house for any reason, we will arrest you, no questions asked. So, of course, Pranoosh. I felt like a criminal breaking into my house that night just to get some of my bare essentials, My school uniform, my uniform for work, my school books, my toothbrush. Because I knew I was never gonna be sleeping in that home again.

[Farnoosh Torabi]

Oh, my gosh.

[Sirenise Pierce]

And before I that home, I remember my mom always telling me to take pictures of the house. You never know. And I never knew why she told me that because she always decorated it very nice. And I took one good look at that home and I was like, wow, I'm done. Wow. I can't deal with this shit no more. I can't live like this anymore. Living in complete fear. Seeing a police officer thinking they're going to come kick us out. Seeing a tow truck and thinking they're not here to help me, they're here to take the car. And all of that fear that was just built up in my body, just released.

[Farnoosh Torabi]

Wow.

[Sirenise Pierce]

And I told myself, I cannot do this. You know, I see how my sister took it, how my parents took this situation. And it wasn't just our household. In my neighborhood, lots of people were losing their homes, lots of people were losing their jobs. And eventually my parents even ended up divorcing. So I lost more than just a home and a car. Forget that losing your family unit is a huge deal. And seeing how deep and how big a recession can impact you, your actual life, on a day to day basis, that's what woke me up. And it changed my life. And I realized, you know what? I gotta figure out this money stuff because no one's gonna come here to save me. And I started realizing that I was living my entire life based on fear. I picked my first major in college, not because I was passionate, I loved it. I picked pharmacy because I wanted a recession proof career. I wanted to know that I was gonna come out of college making money, I could take care of myself. I. And I realized, man, I'm making a lot of choices. My decision matrix was Very narrow, very focused on. There's only one way to get out of this. When there's so many ways to survive difficult times, it's not just breaking into your home. There's other solutions.

[Farnoosh Torabi]

Yeah.

[Sirenise Pierce]

So I decided.

[Farnoosh Torabi]

Sorry, go ahead.

[Sirenise Pierce]

Sorry. No. So I decided to change degrees from pharmacy to business. And eventually I found finance and financial planning. And to me it felt like the aha moment. There's strategies, there's systems, there's way to protect yourself. We start learning about budgeting, paying off debt, estate planning, tax planning, protection planning. All of the little things that no one in my community knew. And ever since then, I completely fell in love with personal finances and wanting to help my community, my friends, my family make sure that we can take care of ourselves no matter what's going on.

[Farnoosh Torabi]

Wow, what a story. Oh my gosh. And as you were sharing that, I couldn't help but think about. You said so many millions of households impacted in a similar way. Houses being foreclosed on, sheriffs knocking on the door, the liens put it put on the homes. And this was not just a recession, this was a housing crisis. 2008, 2009. So you have this sort of quote unquote, rock bottom moment. What's worse than being forced out of your home? And first of all, why they gotta do it in the middle of the night? Like, can we have some, like, decency? So that's another thing. But what was the first thing you did? It sounds to me like there were many steps, right? You reconciled with your fears, you started to read more about personal finance, you switched your major, but what was the first decision that you made to yourself in that moment that allowed you to start to rebuild and rebuild and rebuild.

[Sirenise Pierce]

To me, it was hitting that I'm done moment and realizing that I don't have to continue down this path. When I saw myself breaking into my own home and knewing that, you know the consequences behind that, that's not me. Like point blank, that's not who I am. My decision matrix was completely screwed up. I was in survival mode and I had a scarcity mindset and none of that was apparent to me. I think that's the scary part when, you know, you're making decisions in your life and you're thinking, oh, this is the best decision for me. And then something happens this dramatically and you realize I'm not making good choices, I'm not making the best decisions for myself and where I actually want to go. I was in community college at that time and a lot of my friends, they all got out of community college, they dropped out. And the amount of people who were transferring were very low. And I knew all the odds were stacked against me around this time. I also got a full time job and I went to college full time. I had to figure out how to get out of this situation and into a four year university so that I can take care of myself. Realistically, this is how I saw it. This is my opportunity to take care of myself. If I don't do this, who's gonna take care of me? My parents can't. Right now we want everyone to have

[Farnoosh Torabi]

this mindset and yet not everyone can or does or chooses to. And you said you had a sister, you had parents. Like, were you kind of alone in this laser focusedness to rebuild? And if you were, what do you think it is about your personality, your makeup? There are behavioral biases that happen. There's something like, for example, a home foreclosure. There's a distrust of the system.

[Podcast Narrator/Host Intro]

People have a hard time moving on

[Farnoosh Torabi]

and reinvesting in their financial lives for that fear. But what was the voice in your head that differentiated what your journey would look like versus somebody else who would have just stayed stuck?

[Sirenise Pierce]

I think I started seeing myself as the older sister in the Latina community. We're the backbone of the family. And seeing meet myself in that home with my sister, breaking in and doing that, I felt responsible. And even when I went and transferred to Cal State Northridge, I took her with me. She was there with me for a year in the Valley in la. And I felt responsible. I need to make a good impression for not just her, but our friends and our family, to let them know that there is hope we can do this, but we have to stick together. And being the eldest daughter, I had to have tough conversations with my parents about money. And sometimes they're like, no, we know best, we're the adults. But because you're learning about finances, especially for me, when I was in my personal finance classes with investing and retirement, all these things, you couldn't shut me up, to be honest with you. And my boyfriend at the time, which is now my husband, he was like, you know what, I'm open. Tell me all this stuff. Because his family also struggled a lot during the OIT recession. His dad lost his job and his confidence and you can see that. And he was also very driven and motivated to make a name for himself and get out there. He moved from Alabama to California, which is a really big jump his community. And he was excited and driven and I was too. So I was looking for my own tribe. I had another friend that went to usc, and I would hang out with him and try to get involved with people who were trying to push forward and not feel stuck. And sometimes, really, that community really does matter. Who you hang around with, what you're reading, what you're seeing on social media or on YouTube, on TV. It does make an impact. So you really want to make sure that you're nourishing yourself and not positioning yourself back in the old environments that weren't letting you grow.

[Farnoosh Torabi]

Yeah, yeah. Creating boundaries, really being intentional. What would you say is your favorite part of personal finance education or practice? Like, for me, I like earning more than budgeting. I like conversations about investing more than saving. And I think that's not everybody. I think everybody has, like. Like their own interests within personal finance. Where do you think you love to hang out and play most?

[Sirenise Pierce]

I don't know why, but I really am intrigued with asset allocations. I don't know if it's just a fancy word. It just makes everyone say, oh, okay, what's that? But I love not having all your eggs in one basket again. Because my parents are from Dominican Republic. They're immigrants. Over there, there's a very different mindset. They don't have the stock market. There's really only a few ways to make money. Either you own real estate, you own a business, or you play baseball. That's about it for my parents. We came over here, my dad, and he's all attainable. Attainable, yes. So he's, you know what I'm gonna do? Real estate. And because they put so many of their eggs in real estate, they didn't have an emergency fund. They didn't have investments for retirement or even a brokerage account. They didn't really have a lot of second plan, any plan in place. And that's what my parents were arguing about. My mom had one idea, my dad had another. My dad said, just sell a house. The market's down. The house isn't gonna get a lot of cash for that. And that solution no longer worked. And that's where I started realizing you really do need to have different diversifications when it comes to your savings, when it comes to your investments, when it comes even to your retirement plan. When you start talking to people in financial planning, they have a completely different strategy for your Roth ira, a completely different strategy for your traditional ira, your brokerage account, different thing. And I love that because it gives you clarity, and it makes you feel like, you know what? There's a plan in place. Even if we are not at 100%, we're at least a 90% and we're gonna get there and we're gonna make it through. But when you have all your eggs in one basket, that's very tough place to be in. So that's probably why I'm so intrigued with asset allocations and different counts for the different purposes. It does have a play in why how I created the high five banking method as well.

[Farnoosh Torabi]

Good segue. Yeah, that's perfect. Let's talk about the high five banking method where you teach people how to basically organize their finances with purpose and I believe is two checking accounts, three savings accounts.

[Sirenise Pierce]

Yes.

[Farnoosh Torabi]

Why do you like this breakdown?

[Sirenise Pierce]

The reason I love this breakdown is because a lot of people look at things in textbooks or online and they hear podcasts or interviews and like, oh, this makes sense. Logically, it makes sense to have different accounts for different purposes. But when you actually go through difficult times, like how I did when and the reality, the reason that I created the high five banking method was because I found out that my son had an open heart. He needed open heart surgery. He had a heart defect when I was pregnant and this was such a difficult thing to wrap my mind around. I was five months pregnant. They're asking me, hey, do you want to keep the baby or do you want to keep going? And all of these difficult decisions I felt that were out of my hands and out of my control. So the main reason why I love the hi Fi baking method is because it allowed me to take control of the things that I can take control of. When it comes to your health or the future, that's up in the air. But when it comes to your bills or planning a date night or going to a wedding or buying a home, these are things that you can take control of right now, exactly where you're at. So the main reason why I love this system is because it allowed me to take my hands off of my finances during the difficult times. When times are good, you can budget, you can make good money, you can go on vacation, everything seems a little easier. But when you're going through difficult times where you don't have the mental capacity to be focusing on, are the bills paid? Do we have money to go out to eat? Do we have these things? It alleviates the day to day stress that so many of us are having on our heads. The mental load, it's too heavy. We need to reduce it and get some margin back into our life. So when we have a system for our money. We can feel confident that, hey, the responsible, the responsible things I have to get done are getting done. If I want to spend a little bit of money for free time, that can be happening. My emergency fund taken care of. My short term and long term goals handled. And when you talk to someone that's in the financial planning space, they love the hi fi banking method because you're secretly budgeting, you're secretly having a protection plan. When you have your emergency fund, you're secretly setting goals for your short term and long term things that you want to accomplish. So there's a lot of financial planning practices in it and it makes budgeting so much easier. Especially if you're someone who doesn't like budgeting, you just feel like you have the time for it or just get overwhelmed with numbers. I know that some people, they see these large numbers and they're like, okay, you went too far.

[Farnoosh Torabi]

So walk me through it even more crystally. You can use yourself as an example or what are we labeling these accounts? What are they for? Is it like one's for debt, one's for. I have a separate account that's. I just labeled it the other day. I didn't realize I could even do this at my bank, but for how many years I went, I knew intellectually oh, this is my account for this. But like I hadn't visually cemented it. And then of course, it's so easy.

[Sirenise Pierce]

Like you, they just have a little

[Farnoosh Torabi]

edit it emoji and you just click on it and you can change the name of that account. And I changed it to what is it? The when I have to pay my taxes ahead of time, the early taxes or whatever. I know that's not maybe as specific as you advise, but it speaks to the visualization and the compartmentalization I think that you insist upon. But walk me through these five different accounts and the practical uses of them.

[Sirenise Pierce]

Yes. So to keep it simple, the high five banking method is a money management system that's composed of five purpose driven bank account accounts where you have two checking accounts and three savings accounts. So the first checking account is gonna be for your bills. This is where you put all your mandatory expenses like housing, transportation, utilities, healthcare, minimum debt payments, and even groceries. All the mandatory things that you need to survive needs to go into this one checking account. Once you have this account filled up, give yourself a thumbs up, you're doing good. After that, the second checking account is gonna be specifically for your lifestyle. This is for everything that doesn't go into the bills. Accounts think of eating out, entertain, late night, buying clothes for the kids or for yourself. All of the fun things that you want to do on a monthly basis that you want to make sure you're not getting out of hand. Because a lot of times we'll start putting these on our credit cards, we'll start overspending and going over budget. We want to make sure that we have a cap that you know, that you can spend 500, let's say, for example, feel free. You don't have to feel stressed out about that. But I always want to remind people, the more pointing you do, the less saving you can do. So if you want to be okay, just make sure you control that lifestyle account. Now, when it comes to the three savings accounts, the most important savings account is your emergency fund. Without a doubt. You wanna make sure you have a protection plan for you and you have a little bit of a safety net just in case life doesn't go perfect. Because hey, this is life. Sometimes it comes out of nowhere. So you really wanna make sure you have money set aside just in case there's a job loss, there's a recession, there's a natural disaster. You wanna make sure you have what you need to take care of your household after that is gonna be your short term goals to me. This is my I'm not going back into debt account account that you can utilize to save for vacations, to save for annual memberships, for some of the fun things, but also some of the boring things that come up in life. These are for goals that take less than a year to save up for Christmas. It comes around every single year, the same date. We want to make sure we're saving up for it and we're not catching us off guard. So this is the account where you're going to pinky promise yourself that you're not going to get into debt for any of these expenses after that. The last one is going to be your long term goals. These are goals that take more than a year, but less than five years. This could be saving up for a house, a wedding, a sabbatical. You want to make sure that you have this money set aside in a separate account so that you can clearly see that you're getting closer to your goal. And because some of these goals have a high price tag, down payment isn't cheap nowadays. You want to make sure you're giving yourself time. If it takes you three years, that's all right, takes you four years, that's okay. Just stay committed to your long term goals and Once you have all five accounts Accounts give yourself a high five.

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[Sirenise Pierce]

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[Farnoosh Torabi]

Oh, wow. Okay. And so what are some of the stories you hear from people who are doing this? Where they had everything in one pot and now with the five, how has it changed their ability to save, their ability to achieve goals? And also, like, where does the investing go? Is that I assume this is all after your paycheck, so maybe you have a 401k at work, you're already contributing to that, but if you're doing it on your own, is that coming out of your necessities, you think?

[Sirenise Pierce]

Yes. So the first part is the people who are doing the hi fi banking method. What I've noticed with a lot of couples specifically is that they're communicating a lot more about their finances. Everything was very separate. This person handles this, this person handles that, and it brings a lot more openness and communication when it comes to the finances. I've also seen a lot of people share that they're accomplishing a lot more goals than they were previously. That I have a friend, that she bought her home and now they're saving up to buy rental property and that they're seeing the forward momentum and it makes them excited together to be like, hey, we're both combining our finances to get towards this goal and we're getting to it quicker. So it brings a level of excitement and joy. And again, especially when it comes to the emergency fund, a lot of couples, they want to make sure that they're taking care of themselves. But this is for both people and for your kids especially. Life gets very hectic when you have a family. So you only really want to make sure that you have that savings and that both partners can actually access it. Because if something happens to one partner, they get in a car accident or God forbid something happens, the other partner can be there, be like, hey, I got the medical bill, I'll make sure the bills are getting paid. And it gives that transparency that a lot of couples are needing when it comes to their finances on a day to day basis. And I'm really excited about it. I've been using it for years at this point. And even from my own marriage, we do all hands meetings where we talk about our finances and we both make sure that we're keeping up the accounts and maintaining them so that they're very clear and transparent for both of us to understand. The whole point is for it to be easy. It's not for it to be difficult for you to see how much money you can spend. Can you go out to eat? For both of you to say, hey, can we afford to go out to eat this weekend? Yeah, we can. We have $300. We're good, let's go. Yeah, yeah. And to be open in that way, I know communicating about finances in relationships or even with yourself is a little intimidating for even individuals. So to have that transparency and that clarity is key when it comes to retirement. The main reason why retirement isn't part of the hi fi banking method is because I want to not look at retirement as a savings account. I want them to look at it as a investment account. You have to invest the money you can't save your way to retirement. And also because some people, like you said, some people have 401ks, 403bs, there's a lot of options on how people can put money away for retirement. If you're someone who doesn't have a company sponsored retirement plan, you can definitely put money into your bills checking account to transfer into your Fidelity or Vanguard account to fund your own individual retirement account or Roth IRA as well. So I, I definitely want people to know that there's a lot of flexibility. This is a framework, it's not meant to be set in stone where you have to have all five accounts at the same time. It really builds upon based on where you're at. So if you're someone who, you know, you don't feel like you have the wiggle room to save for retirement, that's okay. Let's make sure that we're nailing down your bills, giving yourself a realistic lifestyle budget. Because even at my lowest points, I still had a lifestyle. It might be $40, but it was still a lifestyle. So we want to make sure that we're being realistic with ourselves. A lot of are really trying to maximize their retirement accounts, but then they're ending up in credit card debt and then falling off their budget because they're not being very honest or transparent with themselves about how much they can push towards retirement. And I want people to have that honest conversation with themselves. And that starts with looking at your bills and looking at your income and seeing how much can you actually squeeze out to push towards retirement in a realistic.

[Farnoosh Torabi]

Yeah. Oh gosh. One thing that keeps coming up a lot in my conversations with experts and even just neighbors is just either a recession or the reality that life is so expensive. Yes, I get that I have to save and I have to budget and I gotta live within my means. But when you have inflation with where it's at, and our wages haven't really caught up to the cost of living. I'm just curious what you're hearing from your audience and what you would to somebody who's like, I have. I'm doing the high five banking method, working towards having an emergency fund. But it's just like, the necessities of life are so expensive, I don't even know where to cut back. What would you say to this person? Is there always room to cut back or is it maybe time to shift the strategy to a different way of creating breathing room in your budget?

[Sirenise Pierce]

Yes, definitely. I'm very positive that there's multiple ways to solve this problem. For a lot of people, they feel like they're living page to page. This is a situation that we're hearing across the board, all over cnbc, the news, every outlet that you can think of. But when you actually look at the numbers, about 38% of people are living below the poverty line where they're getting government assistance. They are low income. The other percentage of people in that gap, they're having a cash flow issue. So what I teach in the book, a few different strategies to help you with that cash flow issue. First one would be the cut, keep and reduce strategy. This is something that I came up with during the pandemic when I realized that my husband and I do not have a game plan of what to do if our income abruptly cuts.

[Farnoosh Torabi]

You have no game plan for a pandemic?

[Sirenise Pierce]

No. Yeah, we had no game plan. We're like, at what point do we cut Netflix? I don't even know. Everyone's fighting over toilet paper. I don't know what we should be doing. And it gave me flashbacks of 08 when my parents were disagreeing on what moves they should be doing. My mom wanted to do this, my dad wanted to do that. They disagreed. They ended up doing nothing. And we all suffered because of that. So I really wanted to make sure that my husband were on the same game plan. So we actually reviewed all of our bills and we wanted to do a game plan A, B and C for the worst case scenarios. Not just if there's a pandemic or a recession, but also for ourselves, so that we know there are strategies, there are game plans that we can actually start executing. At what point do we need to cut, keep, or reduce our housing expense? And what options do we actually have for a lot of people that are renting, they don't even know where their lease agreement's at. There's A lot of information on there. Do you have a 30 day net where you have to let them know that you're going to leave or a six? How hard is it to get a roommate? Is that opportunity? What steps do you need to know in order to reduce this expense or even cut this expense out of your budget? For a lot of us when it comes to our cell phone bill, there's a lot of options. We know that we can switch plans, we can add a family member to make it a family plan or we can even move to boost mobile or cricket. We know that there's multiple ways to reduce this expense. We don't have to go cold turkey and start cutting everything out of our lives. And the main thing that you want to focus on, especially when you're doing a cutkeep and reduce strategy, is how can you extend your emergency fund Runway? That is when you're starting to reduce your expenses, you're giving yourself more wiggle room. That's going to give you the opportunity to have not just a three month emergency fund, but you might have a four month emergency fund by the time you do a cutkeep and reduce. And now you're feeling more confident like oh my goodness, we can get through this. You have an extra 30 days to make moves and that can make a huge difference in how traumatic or how successful your family gets through these difficult times. Another strategy that I talk about in my book is called the two week gap strategy. What I realized when I was working full time, around 2010, after we lost our home, I started working at a payday loan spot. This is the, this is at a point that I had no idea what this was. I had no idea about finances. I was just learning. I was looking to get a job that was full time, that can pay well. And I saw all of these amazing people, super sweet, that were making good money coming in every two weeks to get a payday loan. And when I saw the interest on these payday loans, I was shook. They were in the hundreds. We're thinking credit cards are bad because they're in the 20s and 30s. These interest rates were in the hundreds. It was wild to me. As I kept working there, I realized these people don't have an income problem, they have a cash flow problem. The timing of their paychecks are off sync with their actual bills. And I came up with a strategy that will help people get at least two weeks ahead of their bills. By doing a no spend challenge. They'll pull back not because they have to, but because they want to on lifestyle expenses, they'll cut savings, investing, even if you need to, and all lifestyle expenses. So you can get that two week gap, two weeks, a little bit ahead, at least two weeks ahead of your bills so that you can have that security and that margin that if anything happens, you at least have some extra money in your bills account to give you that peace of mind. Because so many people are using buy now, pay later credit cards, payday loans right now. And you need to make sure that we have that gap so that we're not positioning ourselves to use these tools in ways that aren't benefiting us. Because credit cards are great, but if you're carrying a rolling balance, that interest is pretty hefty and it can add up very quickly.

[Farnoosh Torabi]

When you were working at the payday loan site, what was the average amount they were borrowing? Borrowing?

[Sirenise Pierce]

It was about 200 to $250.

[Farnoosh Torabi]

Yeah.

[Sirenise Pierce]

So it wasn't like, yeah, it wasn't like a huge amount, but every single two weeks they'll come and pay $300, about 45 to $55 in interest for just two weeks to borrow it. And I know it doesn't sound like a lot, but in a month that's $100, for example, or $110 that they're paying back. So they had the money. But if they just maneuvered a little differently, that could be changing the due dates on some of their bills, negotiating, doing a reduce, seeing what they can do. Because there's a lot of people that, you know, get paid twice a month and then you get a new job and then you get paid once a month. That's a big shift.

[Farnoosh Torabi]

Right.

[Sirenise Pierce]

But if you have that two week gap, you're at least in a better position where you're not going to be getting the back end of these financial tools. And they're there for a reason. And again, buy now, pay later credit cards, they're very profitable for a reason and they're here for a reason. They're there just in case case. But we cannot continue relying on them. So if we're positioning ourselves to have a little bit of wiggle room, that margin, we don't have to be perfect because none of us are perfect. Life's not perfect. So we need to be grateful to ourselves and be nice to ourselves and say, you know what, I really do want to go out to dinner with my friends, but I want to be nice to myself and make sure I have that margin so I don't feel stressed out in case a paycheck doesn't come on time, government shutdown or a vendor. You can be your own, have your own business, then they switch. If you're thinking you're gonna get paid in 30 days, it's actually 60 days. And you're like, oh, no.

[Farnoosh Torabi]

Yeah.

[Sirenise Pierce]

Have a question?

[Farnoosh Torabi]

It sounds to me like what you're also encouraging people to do is to be an advocate for yourself, which I don't think many people default to that personality trait of with that relationship with their money that, like, I can be in control. We think the bill's due when it's due, and I'm gonna get paid when I get paid. And the cost is the cost. And I think we don't say, wait, what if it wasn't that way? Let me call, let me negotiate. And this is stuff that you have to learn because if you don't see it when you're younger. And my parents, they fought about money a lot, but the one thing that they did teach me was that everything is a negotiation, really. It is at the end of the day or better to negotiate early on, as opposed to when you're like houses in foreclosure. But when you start to feel that financial stress and the pinch, like that is the moment to. Or when you anticipate that happening, to go in and have a chat, even not even on the phone, like, you can just. I found success just with chatbots, lowering my cell phone bill on the website. It's not every day, but that does happen. We just have to put ourselves in that role and believe that we do have some authority when it comes to these sorts of things. So now tell me a little bit more about your book and where we can find. Find it and maybe one piece of financial advice that has recently even changed your life. Because we're always learning. I feel like I'm always begetting schooled on personal finance in my own life as well.

[Sirenise Pierce]

Yes, definitely. So the book is available everywhere that books are sold. Barnes and Noble, Amazon, Target, Walmart. I'm super excited that it's out and available for people to actually start reading and enjoying and learning a little bit more about me and how they can implement this strategy into their own personal finances. And when it comes to me, I think it's all about creating systems. Even though I am the systems lady in personal finance at this point, I have a system for my meal plan. I have a system for my household, I have a system for my finances. There's always ways to make improvements. And for me, in my household, it's learning about new Topics that you can bring into your all hands meeting. This is something that I also teach in the book where you don't just look at the last 30 days, you're also looking at the next 30 days on what you can start implementing. And with all the changes that are happening with the government and the economy and my kids school being open to saying, you know what, I forgot this, to bring this up during this meeting and just being honest, hey, it flew over my head. And just accepting that you're not always gonna be perfect, you're not always gonna have all the answers. And I feel like when you do that, it opens up the conversation to be a little bit more smoother. You're accepting that you're not perfect. And even in my relationship, I'm not perfect. I'll admit that when we're talking, talking about new expenses that are coming up, going over budget or not saving as much, you want to be proactive and honest with yourself and also your partner and your family members, whoever's involved in that family discussion. And don't be embarrassed. Right now, a lot of people feel a lot of shame when it comes to their finances, of learning new things. Like you said, you and me, we're both students of personal finance.

[Farnoosh Torabi]

Stay curious. Stay curious. It is absolutely one of my first guests on the show. I asked, what makes you so money? And they said, I continue to stay curious. You know, so what?

[Sirenise Pierce]

I love that.

[Farnoosh Torabi]

Sirenise, what makes you so money?

[Sirenise Pierce]

I think what makes me so money?

[Farnoosh Torabi]

I'm gonna start throwing that into.

[Sirenise Pierce]

Really good question.

[Farnoosh Torabi]

Yes.

[Sirenise Pierce]

Bring that back. Bring that back.

[Farnoosh Torabi]

But a goodie.

[Sirenise Pierce]

Yeah, I think I am. I'm open, open to learning, I'm open to experiencing new things. There's so many new investments always out there. There's always new ways to save more high yield, saving management accounts. And you just, you never know everything. I think that's the biggest thing. Even if you consider yourself a financial expert, you're always learning still. And I think a lot of people, they feel intimidated to speak to financial experts or to get financial advice because they feel intimidated. And I heard it too many times in the elevators. Merrill lynch at Ameriprise. I would hear people saying, I don't know what we're invested in. I don't know what's going on.

[Farnoosh Torabi]

Yeah.

[Sirenise Pierce]

And a lot of times it's just, speak up for yourself. BCC on all the emails to the tax people, to your financial advisor. Get involved and don't act, oh, my partner has it covered. No, you need to have it covered. As well.

[Farnoosh Torabi]

Yeah.

[Sirenise Pierce]

And I feel like being a partner nowadays for women, they feel like it's not their place to learn about managing the finances. And I want you to know that it is your place. You are in the right place. So take pride in that, in everything that you do and teach your daughters the same thing because that's what I'm doing with mine. She's reading the hi Fi Banking Method now. She's like, you can't read it. She's really high in her reading. So I'm excited for her. She really wants to start like learning about money and investing and I feel like that's the biggest blessing that you can give to your family. Have them be curious, have them want to learn about money and how to maximize what they have. Everything in life is a blessing. How do you maximize? It really shows your stewardship.

[Farnoosh Torabi]

Sirenice Pierce, thank you so much. The High Five Banking Method. Pleasure to meet you. Thank you so much for your storytelling being so honest and raw. We really appreciate, appreciate it.

[Sirenise Pierce]

Thank you.

[Podcast Narrator/Host Intro]

Thanks so much to Sirenise Pierce for joining us. Her book High Five Banking Method is linked in our show notes and I'll see you back here on Friday for Ask Farnouche. I hope your day is so money.

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