Monday, October 29, 2018

My Money Story

Since October is gifting us with a fifth Monday, I decided to share the interview I did for my first podcast episode, when I launched Money Mondays with Sorana. If you prefer the audio version, please check out this and all the other episodes in the player on the right side of the page at the top. Here is the transcript:

1. What is your biggest money accomplishment?  
I think that my biggest money accomplishment is the fact that I have been able to be self-employed for over 10 years now in my adoptive country; and just being able to maintain that, and not having had to depend on anyone for a paycheck, represents an accomplishment that I’m proud of. And for me coming from a background within a blue-collar family that always depended on a paycheck, I think that is a major accomplishment. I am able to sustain my lifestyle and do the things that I want to do and not really depend on a 9 to 5 or a regular steady paycheck. Once I learned about
entrepreneurial ventures and the way they can work in the 

U.S., building my own business became a no-brainer. I’m happy to see the fruits of my labor and to wake up every morning knowing that I’m one step closer to my goals and dreams. 

2.     What is a money memory from childhood that comes to your mind right now?  
Well, growing up, my parents were, like I said, blue-collar. So, they went to work and brought home a paycheck. Back then it actually used to be cash. My mom’s job was to actually give out the wages in her department within the plant. Sometimes she would bring home new bills because since she was giving out the wages, she tried to put those to the side. So, she would take the money I had saved and trade it for new, crispier bills, better looking, prettier ones than I had at that time. And, for me, that was really cool because I liked the new money. Actually, to this day, I like the new bills that have no creases, and I’m still inclined to save them. 
So if I would get any new bills – let’s say instead of what in the U.S. would be five $20 bills, I would get one $100 bill – it would help me save money. I always had some cash stashed somewhere because I liked the feel of new money and I didn’t want to part with it. The newer and the bigger the bill, the better, because I would hold on to it the longest and I would not feel compelled to spend it on trivial things. I guess you could say this was how I learned to save.  
3.     What is your biggest money challenge? (currently or ever) – if past, how did you overcome it?
For me, the biggest thing was coming here (to the U.S.) and having to figure out how things are done in this country. Before coming to the U.S., I didn’t even know what a credit card was. I knew what a mortgage was only because we had one of those when I was growing up (though a lot different set up than here), but not what a credit card was. I didn’t know how those interest rates can cripple your finances for many, many years. So, I learned those lessons: some of them the hard way, some of them from other people. But it was a good lesson to understand all of that.  

My husband (the one I married before coming here, and whom  I’m still married to) is of the opinion that if he didn’t have enough money to pay it off, he would not buy it. And when I first arrived in the U.S. we needed reliable cars – or at least one, since at the time I was not driving. So, we got some clunkers for cars because he didn’t want to have monthly car payments. When I finally decided that was not going to work for me anymore, I had to learn how car financing worked, because he never needed it. So I had to learn on my own.  

We had 7 cars in my first 2 years in the U.S., and that was not because we had a lot of money and we wanted to have 7 cars, but because they were dying. At the time my husband was driving me everywhere. Based on that experience, when I started driving myself, and while having a career that required transportation because of a lot of field work, plus being a woman driving mostly by myself, I had to have a reliable car.

I had to have a car that would not die on the side of the road. That was a big one for me. From my need for reliable transportation, I learned a lot about credit purchases, credit score and credit history. It was quite stressful at the time but also very educational for someone who had no experience with the U.S. credit system. 

4. Share a money lesson you guide yourself by – your money mantra or belief.  
The most significant thing is to make sure that I have some money left at the end of the month. This way I know I’m OK at the beginning of the month. And the reason I’m saying this is because I’m self-employed, and I have to make sure that my months run together smoothly. I don’t know when the next check is coming, so I have to make sure that I have enough money for the next bill. That way, when I get my next paycheck, I have enough for the next bill. So that is my plan. As someone who had been working on commission for many years now, the planning from one check to the next is a little different from the employees with a predetermined amount coming to their bank account every week or every other week. 
I would not say I’m great at budgeting every dollar, but I became really good at establishing priorities and making sure the income went toward necessary expenses before going to unimportant things. Fluctuations in income (as all entrepreneurs can relate to) taught me to classify my expenses in 3 categories: fixed, flexible and discretionary. And this is how I managed my finances. 

5. If money were no object, what would your perfect day look like?  
Well, I’m an animal lover, so I would probably spend it with cats. I know that is not expensive, so it is not about the money, but that is what I would enjoy. I also like traveling so if money were no object, I would travel a lot more than I do now – and I already travel quite a bit. And if money really were no object and I had all the money I needed, I would probably take my cats with me on trips – which would be really interesting.   

I would also go back to Florida and visit the Big Cat Rescue, which is a sanctuary for big cats. And if I could have all the money that I wanted on a regular basis, and not just as a onetime lump sum but as cashflow, I would like to be able to donate to them enough to keep a tiger there. When I was there I learned that it takes about $10,000 per year just to feed the tiger – it doesn’t include housing, medicine, surgeries or whatever they might need. So I would like to literally adopt a tiger there – just feed that tiger for the rest of his or her life. 

Being able to help animals, especially cats big and small, and be a voice for them to enact changes in legislature and people’s behavior is my WHY for working on my business to grow it and make it a financial success. 

      6. Share a goal that you achieved that had a price tag.  
In 2015 I bought a brand-new car. I really needed it because my old one, even though it was still good and working, was kind of old by then. And I was able to buy the car paying it off in cash. That was really awesome because I don’t have to worry about a car note. I have a new car that hasn’t needed
(thank God) any repairs. And probably won’t need any for a long time. I’m a big fan of Corollas. I’m still in the same brand family, nothing fancy. But it is a car that I know I can rely on to take me where I need to go – and I do drive a lot. So I like to know that wherever I need to get, I can get there and I won’t risk dying on the side of the road because of the car failing.  

Achieving this goal was great not for flashy reasons and vanity but for practical reasons and because I wanted to practice what I preach. The new car was a necessity; a luxury vehicle was not. So I took care of what was necessary in setting and achieving my goal.  

For those listeners who want to get a car and cannot pay for it in cash and will have a 5- or 6-year loan, my advice to help pay that faster is to wait a little bit if you can. Look at your credit score and fix whatever you can on your credit report to raise your credit score – if it is not an emergency. If it is an emergency, then, of course, you go ahead and buy. If you don’t need to worry about your credit score, then you can buy. But most people have little bumps and bruises on their credit report. Fix your credit report as much as possible before committing to a purchase with a payment whose size is determined by your credit score. The higher you can get your credit score, the lower your interest and your monthly payments will be.  

Once you get the car, pay a little extra each month (however much you can, without putting yourself in a bind). My first car that I financed, the car I traded in last year, I had a 5-year loan on it. I wanted to pay a little more; so I actually didn’t take the whole 5 years on it. It feels really great not to have a car payment. That is why, though I wanted a new car, I was really determined not to get a new loan, because I knew how good it felt not to have a payment. So, if you can, and there is a way to ask them to put the extra toward the principal, that is what you want to do – make sure that principal goes down. 

7. If you could double your income, what would you do with the extra money?  
At this point, if I doubled my income I think that I’d probably save some of that toward purchasing my dream home. We do own the house where we live, but it is not the dream home. It is the house that we got, and we are glad to have it. It would be great to have a dream home at this time because I don’t want to be retired and cut grass and do maintenance, so by then, I would probably be ready to downsize. Therefore, if I can hurry up and get my dream home now, I can enjoy it for some years until that time comes. That would probably be what I would do with the extra money. And, of course, save some for later, because I’m always planning for my retirement. 
I need to point out that I don’t see retirement as a vegetative state – posing as a couch potato – but as a time when I work because I want to, and not because I have to. I also see retirement as a time when I focus more on giving back – through the charities that I support, and working on changing the world. Just heard the phrase “going from success to significance” recently and it spoke to me; it suggests a time when I would focus exclusively on helping the community, and most of all, the animals I love – without tracking numbers (activity and revenue) for my business. 

8. What is the one thing you wish you knew when you were 21?  
At 21 I graduated from college back in Romania, so I really had no idea what I wanted to do with my life, other than start a career in the travel industry. I started working for a travel agency that was owned by somebody that I didn’t really respect a lot because he didn’t seem to know what he was doing within the agency. If I could look back from where I am now and talk to myself back then, I would say “Don’t worry about working for these people, because that is not what you are going to do for the rest of your life, so you don’t really need this kind of experience.” But it is funny how we go to school… and actually my degree is in tourism – and I really wanted to work in travel agencies. My goal was to travel to different places and know more about places where I can tell people to travel. And once I moved to the U.S., even though I’m still traveling, I don’t do that for a living. So it is funny that I just am on a totally different career path. I would probably say that it is best to learn as much as you can about the business side of whatever business you are in. 

Even if it is not your own, don’t learn just how to do whatever your job is. Learn how the business is run because if at any point you want to start your own business, that is the number one thing that you are going to use. That is the most important knowledge: be an apprentice of the business, not just the craft. You can then use the knowledge with whatever craft you develop later. 

A lot of people fail in their businesses due to not knowing the business aspect, not because they are not good at whatever their business is. If you are a fantastic baker, you may have the best cupcakes or the best cakes ever, but if you don’t know how to run a business, you can still go bankrupt. Or if you are a good plumber, it doesn’t mean you know how to run a business. So that is probably what I would tell myself: “Learn as much as possible about running the business, not just the activity you are responsible for.” 

9.     What advice would you give a woman just starting her business/career?  
If she hasn’t started the business yet, I would say “Talk to somebody who is in the same business you are interested starting, someone who is already successful in that field, someone you admire and respect. And ask them if you can hang out with them, help them around their office or anywhere in their company and learn how things are run. Offer to be an unpaid intern and see what you can soak up.” You don’t have to do it forever. And don’t look at it like you are just slave labor and you have to work for free and they don’t pay you. But look at it as an opportunity to learn how the business is run. This is an opportunity to learn for free, whereas in college you have to pay for the information. Take advantage of this free education opportunity. 

Like I said, you may be the best baker but you have to have some business acumen. And really the only way to learn it is by soaking up from somebody else who is great at it. Because you can read books and go to school, and the professors can tell you, but ultimately, they are just professors, it is not like they have businesses – some might, but most don’t. 

So, if you talk to whoever you are working with, find a mentor that can guide you. Look for the person that you want to be when you grow up. Find that person, and then try to hang out with them as soon as possible and for as long as possible. Because that will help you learn a lot about how to achieve what they have already achieved. It is an opportunity to learn from the best. 

10. If you could spend 3 days with a millionaire/ billionaire, who would that be and why?  
One of my favorite people is Jon Bon Jovi – I really love his music. I’m not sure if he is really a multimillionaire (many times over) but I know he is very successful and I would love to spend some time with him and see how he runs his companies. If I could hang out with him for 3 days, I think I would learn a lot because it is not just about the fact that he can sing – which he can. Ladies, I hope you agree with me! But he also does have a great business mind.  

I was watching a documentary, and he was calling somebody about setting up a meeting, and they were giving him the runaround. And he said “I am the CEO of a multimillion dollar corporation, I demand that we do this or otherwise I don’t care; I’m not interested.” And at that point I realized that he is absolutely right; he does run a multimillion dollar corporation.

So I would love to learn something from him. I believe he knows what he is doing. Another great point I still remember from the same documentary is him saying “this is not a democracy” – when referring to the Bon Jovi company. I took to heart the idea that someone has to make the executive decisions and take responsibility for the outcomes.  

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