Jill Schlesinger: ‘The Great Money Reset’

Our guest on the podcast today is Jill Schlesinger. She is the author of a new book called The Great Money Reset: Change Your Work, Change Your Wealth, Change Your Life. Jill is also a business analyst for CBS News and comments on the economy, investing, and personal finance for CBS television and radio programs. She also hosts the popular Jill on Money podcast and writes the nationally syndicated “Jill on Money” column for Tribune Media Services. Jill’s first book, The Dumb Things Smart People Do With Their Money, was published in 2019. She has received numerous awards over her career, including an Emmy Award for her work on CBS Sunday Morning. Jill is a certified financial planner and spent 14 years as the co-owner of and chief investment officer for an independent investment advisory firm. She began her career as a self-employed options trader on the Commodities Exchange of New York following her graduation from Brown University.

Background

Bio

The Great Money Reset: Change Your Work, Change Your Wealth, Change Your Life, by Jill Schlesinger

The Dumb Things Smart People Do With Their Money: Thirteen Ways to Right Your Financial Wrongs, by Jill Schlesinger

Jill on Money podcast

Making Changes and Mindful Spending

“How the Pandemic Changed the Rules of Personal Finance,” by Paddy Hirsch, npr.org, Jan. 31, 2023.

“Year-End Money Moves 2022,” by Jill Schlesinger, jillonmoney.com, Dec. 2, 2022.

“Use This Expert-Approved 5-Step Strategy to Assess Your Financial Health Today,” by Katie Couric Media, katiecouric.com, Feb. 15, 2023.

Negotiating in the Workplace

“How to Negotiate With Your Boss,” Jill on Money podcast, jillonmoney.com, Feb. 11, 2022.

“The Great Resignation,” by Jill Schlesinger, linkedin.com, Aug. 9, 2021.

Current Environment

“Investor Panic Prevention Plan 2022,” by Jill Schlesinger, jillonmoney.com, May 13, 2022.

“Scary Financial News: Actions to Take Now,” by Jill Schlesinger, jillonmoney.com.

“Bank Failures Put Fed in Hot Seat,” by Jill Schlesinger, jillonmoney.com.

“Silicon Valley Bank Fails: What Happened, What’s Next?” by Jill Schlesinger, jillonmoney.com.

Other

“Jill Schlesinger: ‘What Are You Going to Do With Your Life?’” The Long View podcast, Morningstar.com, Feb. 15, 2022.

Morningstar Investment Conference 2023

Christine Benz: Hi, and welcome to The Long View. I’m Christine Benz, director of personal finance and retirement planning for Morningstar.

Jeff Ptak: And I’m Jeff Ptak, chief ratings officer for Morningstar Research Services.

Benz: Our guest on the podcast today is Jill Schlesinger. She is the author of a new book called The Great Money Reset: Change Your Work, Change Your Wealth, Change Your Life. Jill is also a business analyst for CBS News and comments on the economy, investing, and personal finance for CBS television and radio programs. She also hosts the popular Jill on Money podcast and writes the nationally syndicated “Jill on Money” column for Tribune Media Services. Jill’s first book, The Dumb Things Smart People Do With Their Money, was published in 2019. She has received numerous awards over her career, including an Emmy Award for her work on CBS Sunday Morning. Jill is a certified financial planner and spent 14 years as the co-owner of and chief investment officer for an independent investment advisory firm. She began her career as a self-employed options trader on the Commodities Exchange of New York following her graduation from Brown University.

Jill, welcome back to The Long View.

Jill Schlesinger: It is wonderful to be with you both.

Benz: Well, it’s great to have you here. We want to talk about your latest book, The Great Money Reset. It’s about people navigating transitions in the wake of the pandemic. Why do you think the COVID-19 crisis was such a catalyzing force for so many people to undertake big changes in their lives?

Schlesinger: I don’t remember a time in my life when collectively we all went through an excruciating experience that kind of forced us inward. And that goes for people who were maybe pulling their hair out of their head and saying, Oh my God, my kids are home. I’m schooling them. And it’s been in the quiet moments where you were really thinking what is this pandemic? This is so scary. My physical health is threatened, and I am looking around and I’m seeing chaos and I’m scared. And as that fear kind of started to morph into something else, I think it became this self-examination where so many people were forced home that allowed them to maybe have the space in their minds to be able to contemplate a really critical question that you wish you asked all the time, but sometimes you just don’t, life gets in the way—is this really how I want to live my life?

And something was interesting that’s happened. I’ve gotten questions like that when I was a financial advisor for 14 years, I think that oftentimes when people go through traumatic experiences—it can be an illness, and it can be a death, and it can be a divorce—that it does require some introspection. I just never had experienced the amount of people who were talking to me on my podcast during the let’s say, early pandemic called the summer of 2020, through right the end of 2022, who really said, “I don’t know if this is how I want to keep living my life. Whatever going back to something was normal or whatever the prepandemic life was, I’m not sure that’s what I actually want to do.” And I was really struck by that. Frankly, I didn’t really want to write another book. I’m not like you. I’m not as prolific as you. So, I felt like I couldn’t write a book and then this book came out of my experience just listening to people, hearing these stories, and trying to walk them through the process where you could make a decision to give people a framework to make a reset, to make a big change.

Ptak: What are some examples of big life changes that you’ve seen people make?

Schlesinger: There have been radical ones and not so radical ones. One of my favorite stories in the book is a story of a woman who was a nurse, and her husband was a physical therapist. They were living their lives as you might expect. I would call them like upper-middle-class people. They made good money. They had some kids. They took on a bunch of debt to put their kids through college. So, there they were in their 50s and COVID hits and the kids are out of the house, but Pam and her husband Tom are really still servicing a lot of debt and feeling tremendous pressure. One day in the operating room, the doctor started talking, and we’re talking about real estate in their area, and she was like, what do you mean? How much our house is worth? And by the way, this is what people are talking about when they’re operating on you I guess—the real estate market, just to put that in perspective. And she was sort of struck when, don’t you know someone who’s a Realtor, get them to come to your house and just see what you think the house is worth.

When they did that, they found out the house was worth so much that almost in a split second, Pam came to this idea, if I sold this house right now, I could essentially pay off all the debt and not have to work so many hours to service that debt and maybe extend my work life. Because part of the problem is that when you’re in your 50s and you still have the overhang of big expenses, you’re crawling to the finish line. And she was taking on a lot of extra work, working many extra hours and overtime to make up for it. So, I thought she was calling me, and I was like, “Oh you burned out because of COVID?” She’s like, “No. I’m burnt out from debt.” And what she and her husband decided to do was sell their house, pay off all the debt, reduce the number of hours she worked and actually take the money for a while and push it aside, just keep it safe and keep working and see how they felt. They didn’t feel like they had to buy anything. They actually went into a long-term Airbnb, and they are still there, and they were very content to see just what an emotional relief the reduction of that debt was.

So, instead of feeling like she was going to limp to this “finish line” of 62 or 65 and not even knowing that she could get there, she said, “Without that burden and without working all those extra hours actually remind myself I like my job when I work normal hours and when I work normal shifts.” And he felt like he could pull back on his physical therapy practice, not seeing 14 clients in one day, that they both felt like the easing of the burden allowed them to have much more longevity in the careers that they really did love. And to me, that was just the perfect great money reset. Wow, I’ve got this unlocked equity in my home, and it allows me to make different choices going forward. And I think that’s one of my favorite stories of the book, because it doesn’t feel so novel, doesn’t feel so out of reach for many people in that kind of a situation.

Benz: Right. It’s not radical. Would you say that that’s sort of a commonality among a lot of the stories that you discuss in the book where people are down shifting in some way in an effort to achieve a better quality of life that maybe they’re making some financial sacrifices or changes, but the greater good is just a more peaceful, tranquil, balanced life?

Schlesinger: I think that that’s a lot of it, and I think that I would have thought that that was very common among, say, late 50s to the 60s. But I also found that to be the case often with even younger people. I start the book with a story about one of the young, rising star producers that I used to work with. And she really was seen as this person who was like on the pathway. I’m sure you guys have experienced this. You meet these people and they’re in their 30s, and you’re like, oh, that’s one. That one has got it, got something there. You know they’re, like, destined to just kill it. She was ambitious, and she did all the right things. And at some point, amid the pandemic, I think she just was flat-out exhausted. She really wasn’t sure whether all that ambition was worth feeling the way she felt, just feeling kind of like at the end of her rope constantly.

I think that for someone who is in their 30s to make a kind of reset often requires introspection and a longer period of time. So, when I hear from people in their 50s, sometimes it is like somewhat of a downsizing and a balance. And when they’re in their 30s and 40s, sometimes it’s, I’m not sure I’m on the right path. How do I figure that out? How do I give myself a self-imposed sabbatical so that I can figure out what it is that I really want? Because I’m not sure the path that I’m on is going to do it. I think that for many people who work in that sort of achievement-oriented way, when you’re getting the external confirmation that you are on the right track, sometimes you forget whether or not you actually like what you’re doing. You’re in it, and then all of a sudden, this thing, the pandemic hits and it’s forcing you to come to terms with certain parts of your life that you may not have been so happy about.

I think that in many ways the pandemic was like this precursor to people saying, OK, wait a minute. Wait, I need a little bit of a timeout here. What am I going to do? Some people really come back and say, I’m doing exactly what I want to do because I know plenty of people who have done that. In other cases, there’s a risk in doing this, and it’s scary to do and maybe you can do it for six months, but you can’t do it for three years. And one of the things that I think that the framework of The Great Money Reset can do is that it can give you the parameters to actually weigh your options, and it can give you, I hope, a time frame that you can impose on yourself to be able to determine, OK, what’s my next step? How long am I going to give myself? I have a side hustle. I want to make it my main gig. What’s the runup to that? I have a consulting practice. I’d like to expand it, or I’d like to make it smaller. What’s my time frame to make that happen? What portion of the money that I’ve saved am I willing to allocate to this project called a reset without blowing up my entire financial life?

Ptak: You talk about the value of backup plans in the book, having a Plan B, noting that, among other things that can help take the stress out of making a change. Can you talk a little bit about that?

Schlesinger: I am the queen of the Plan A, B, and C. I really am. I think it’s funny because, look, I put myself out there. I obviously wrote a bit about my own situation, because I was not born into the world of journalism. I came from two other previous careers. I was a trader. I was an investment advisor and money manager. And then, I kind of happened upon this idea of, like, wow, maybe I could do this thing, this thing called media, which I’d been using to help grow my investment advisory business but that I really didn’t know if I could do full time. So, I kind of look at myself as a very good example. I think the natural tendency for someone like me who is trained as—I was a derivatives trader. I was an options trader. And the first thing we were taught as young traders is always look at your downside risk first. So, I’m always looking at the worst-case scenario first. This also may be just in my DNA. My mother is also like this. But it is a training and in the DNA. And I look at the worst case.

So, I said to myself, OK, I’ve sold this business called my investment advisory business. I have zero income starting at some date in the future. I have a bunch of money saved. What’s the worst-case scenario? Like, if I can’t get any, any, any job at all, I can go sell something. I could go sell software. I knew I could sell because I have a good salesmanship personality, and I could go sell financial services. I could go sell ads for somebody, for a publication. I knew I could do that. I could make money selling. My middle-case scenario, my Plan B, was that maybe I could just do some form of consulting to investment advisors. Maybe I could do some work bringing in some business for them, but also do a little media on the side and grow that presence either on television, on radio—this is before podcasts—do some writing, and maybe I could cobble together some money that way. And then, over the top, I’m going to try for it, but I don’t know if this is going to happen—the first choice would be someone actually hires me to maybe do this thing called talking about money.

And I was pretty set that I’d give myself a year to figure out which plan was going to be executable, A, B or C, and I thought B was the most likely scenario. But CBS News came out of the blue. And as the beginning of this process for me was, shockingly easy, because they came to me and said, we’re going to do something. We need someone who has been in the business, we want to hire you. And that was almost 15 years ago. So, it has been quite a ride. But I always have a Plan B and C in my background. I’m in a business where if the next person who runs a network doesn’t like who you are, your contract doesn’t get renewed. So, always in the back of my head, I’m like, well, if my contract doesn’t get renewed, what’s my Plan B? What’s my Plan C? And for some reason, for someone like me, it gives me great comfort. And I would encourage a lot of people who have big incomes or medium incomes or even small incomes—it doesn’t really matter what it is—it matters that you feel like you have some options, and you create those options for yourself. I think when we feel trapped, we never make good decisions.

Benz: That’s interesting. In the book you talk about, someone gave you the advice to start, I think it was called a little pink book of jottings about certain things. Can you talk about that and how that influenced your career change?

Schlesinger: You have pinpointed one of the most important people in my life. You didn’t even realize this, because it’s not in the book. And so, kudos for you for focusing in on this. I really think you’re awesome. So, I have a friend named Maureen and she is a media person. She had been working for many years at Viacom legacy stations. She worked at MTV, and she worked at VH1, and she worked at Logo, and she worked at BET, and she was really in the media. She is a friend of mine before I was ever in media. And when I was talking about, you think I could do this media thing? What do you think? And she said, “You need a pink notebook.” I said, “What is a pink notebook?” And she literally picks up a three-ring binder, and she goes, “This is a pink notebook.” And she goes, “And here are the sections.” So, she was showing me this is like at every turn in her life and her career she would turn to the pink notebook as an organizing mechanism for her thought process.

And she said, “The first tab I always have struggled with is the money part. That’s going to be easy for you,” which is true. “So, it’s just a way to put your money stuff on one tab.” But the next tab for me, for example, was, she said, “Talk to everybody you’ve ever dealt with in the world of television, write down every single person’s name, get back in touch with them, go have a meeting, and go take notes and find out how someone like you could do something like that and what their lives are like and whether you’d want life. Do the same thing for the next tab, which is radio. Do the next tab, which is writing. Do the next tab for your Plan B. What financial firms would you want to actually work for or with? And in your last tab, your Plan C people, where would you turn if you just had to go make some money right now?” It was such a great and simple way to think about when you’re going through a big change to organize your thoughts and keep yourself accountable to the process. And I thought it was great.

You want to know why this is just the craziest thing is that Maureen, the big planner, always liked to say, “I plan so that I can execute. So, I do.” She would write goals every year, not for her boss, but for herself. I never was that person. So, last summer, Maureen was diagnosed with stage IV ovarian sarcoma, and she died four months later. And the first thing I did after she called me and told me about her diagnosis is I brought her a brand-new pink binder, and I said, “I don’t know how long you have left and we don’t know what’s going to happen next, but I bet you need a pink binder.” Literally, I keep it next to me. I have her pink binder for those four months next to me. And to me, I don’t tell you to get all bummed out. It is a terrible loss for me, for her wife, for all of our friends and her family. But what I tell you is that she was so instructive in this whole process for me about the planning, but not for planning in and of itself, planning so that you do the things you want to do. My friend is dying, and she said to me, “I have had the most unbelievable life. There’s almost nothing I could complain about except that it’s ending 20 years too soon.”

Ptak: You also point out in the book that people contemplating big changes should spend some time delving into what’s the real problem. An example you gave is someone who is dissatisfied with their job may realize that it’s not really the job but rather the boss. Can you share any wisdom about how people can get to the bottom of their true key problem spots?

Schlesinger: I think that sometimes when we are a bit in a rut, it is healthy to really figure out what it is that’s motivating you and what’s causing you the anxiety. When I give that example of Pam and Tom, I’m sure that there are many times she went home from the hospital and said, I hate my job. But was that really the problem? I hate working so much. I hate that I am working so much because I’ve made this decision about carrying a bunch of debt. But in many respects, when you can try to pinpoint what it is that is causing you to feel the way you feel—look, I’m not a shrink. So, I’m not telling you to do that. But I just think that you got to figure out if your job is really a great job and you work for a toxic person, then you got to get out. That’s it. If you start to realize some of the things that, like Maureen always asked me, “Tell me about the things you’d like to do.” And I said, well, I’d like to go on this; I’d like to do this.” “What don’t you like to do?” “Well, I don’t like managing people.” She’s like, “Good, don’t manage people.” And you really start to ask yourself, are you doing the things you actually want to do? We all have to do certain things we don’t want to do. But are you working in an environment that fosters you and your growth? Are you working in a place that sees who you are and recognizes what you bring to the organization? And sometimes you’re just in the wrong field, sometimes you’re in the wrong company, and sometimes you’ve got a rotten boss. And if you can try to isolate that, it may prevent you from having to make such a huge reset. You might say, oh, I never, ever want—I’ll just use myself—I never want to be in media ever again, but maybe I just have one rotten boss and maybe I could go work someplace else or someplace else in that company and take myself out of that negative, toxic environment and find out exactly what’s really moving me these days.

Benz: That was one thing I mentioned to you, Jill, that I really liked about the book was that it isn’t saying that everybody needs to do some really radical change and completely upend their lives, that you plot things on a gradation and in some cases, your answer is, you know what, don’t do anything. In some cases, maybe it’s to take a medium step, like downsizing your home and then, in some cases, a more radical step. So, can you talk about that and maybe share some examples of what you mean by each, starting with the one where you would say don’t do anything, just suck it up and stick with what you’re doing?

Schlesinger: Before we went on the air, I said to Christine, I said, oh, I just had a call like that. And it was not even in the book. But let me just recount the call. Someone calls in and says, I’m really done. I’m exhausted. I’m tired. I’m like, OK, tell me more. I go through all the numbers. And part of this process is a numbers process. When we got down to it, it was like working an extra two years would yield another guaranteed $10,000 a year for her and her family. They hadn’t saved so much money up that just retiring immediately was the slam dunk. And I said, I think, you’re 60 years old and you say you’re done. But I’m telling you, if you just work until you’re 62, you’re going to have many more options, and those options are going to be the ones you’ve created for yourself. But walking away right now and taking that haircut on your pension is really putting yourself at a disadvantage.

I know you guys give this advice all the time, which is, I know you want to take your Social Security at age 62, but if you wait to take that, you really start to feel a much better wind at your back for retirement because you’re not taking a permanent reduction in your Social Security retirement benefits. And if you can even do one step better than your full retirement age, you can wait until you’re age 70, and there’s almost like an impatience or a desire—I just need to get out—and people don’t understand oftentimes that essentially not moving so quickly actually could provide you with much better options down the road, especially if you’re talking about two years and not 20 years. I’m not saying, oh, you know what, stay in a job you hate for 18 more years. We’re talking about two years. You can figure out how to gut it out.

Ptak: Do you think older adults should be more or less inclined than younger people to make big life changes? On the one hand, it may be now or never in a sense for them. On the other hand, we typically have more responsibilities as we age, so pulling off big changes can be logistically difficult. So, what’s your take on that?

Schlesinger: To find older kemosabe. I’m starting to feel like I’m part of that older crowd. Listen, I don’t want to be ageist about it. In many ways, when you’re older, you have more resources. So, you actually have the ability to do it. But I understand that in order to really go through a reset, it can involve a lot of emotional and thorny issues. I recount the story in the book about people who were thinking—they really wanted the last swing, a couple that wanted the last swing at maybe being not an entrepreneur but part of a startup. And when they made this decision and told their kids, the kids freaked out on them. So, it wasn’t that they had a responsibility to the kids, but in some respects, they kind of led the kids to believe that life was going to go down a certain path.

What I would say about making a reset, especially as you get older, is don’t presume everybody’s on board with you. You may have to sell this a little bit. If you can explain to your kids, to your friends, maybe to your parents, if you’re in your 40s and they’re saying, what are you doing, why are you throwing away this career, that you start to lay out the idea that you’ve done the work to test this and that it isn’t all or nothing. There’s a Plan A, B, and C, and that you want to bring people around. But you can’t live your life because of what your kids want you to do. It’s just like when you’re a kid. You can’t live your life for your parents. They give you certain opportunities and then you’re an adult, and then you’ve got to make your own choices.

The thing that I am somewhat more worried about when people make big resets is that they do so without really contemplating the obligations and the promises they’ve made to someone else. So, if I’m in a partnership, a marriage or a partnership, and my spouse and I are on a certain path, and then, all of a sudden, I wake up one morning and be like I’m off that path, we’re done. That’s not really a great way to do it. And conversely, it’s not really fair if you’ve got a kid who is a junior in high school and you’ve decided you’re going to do a great money reset and that means you can’t pay for the kid’s college when in fact you told your kid, Oh, don’t worry, I’ll pay for college. You don’t want to change the rules that late in the game. So, if you’ve made an obligation to somebody, if you’ve told your sibling, yes, of course, I can help you with mom and dad who are aging and yes, I can contribute. But then you do a money reset, which actually puts all the pressure on your sibling to do the financial lift, that’s not fair either. I think it is important to really understand the things that you do actually impact others and you have to honor the—maybe they’re not promises—but you’ve made certain obligations. You know what they are. You didn’t make an obligation to your adult children that you would always be there with the beach house for them. I mean, that is not a great idea to make that promise anyway. But if you’ve done that, that’s a rule I’m OK blowing that one up. College, not so much.

Benz: The crux of the book is how people can assess these perspective changes and make them work from a financial standpoint. You outline what you call the fabulous five, which are five metrics that people should have on their dashboard, financially related metrics, before they embark on a big life change. Can you discuss those fabulous five items?

Schlesinger: Do you think it is sort of like a funny thing? I had to be like a network TV person, label it. You are doing this all the time. I know people who listen to your podcast are going to be like we didn’t need the funny label, Jill, thanks very much. We do this. But this is what I think of the five steps that I’ve always walked people through when they’re talking about their reset.

So, the first is to really take a good hard look at the money part of your life. And you start with the resources that are at your disposal. And when I talk about resources, I’m not just talking about the left side of your balance sheet. It’s not just your assets. It is your assets, of course, but it’s also the income you’re earning. And the income you’re earning is not just your salary, it’s the benefits you receive. Because if you’re doing a reset and you’re 58 years old, and you’re like, I’m out of the big corporate-America job. You don’t have the healthcare coverage. And you’re going to miss that when you don’t have it. You’re not going to have maybe a 401(k) match that you had. You may not have an HSA, a health savings account. You may not have flexible spending accounts. There’s a whole host of benefits that we receive from employers that we very rarely value while we’re working. But when you don’t have them, it’s real. Those are big beneficial parts of your financial life. And it’s not to say you shouldn’t do anything, and you should always preserve those, but we want to list that under the resources that you have.

The second step is to look at that other side of the balance sheet, which is your liabilities. So, what are the debts that are there? It could be your mortgage and it could be a line of credit. It could be a credit card or a car loan or an education loan. Not every single debt is the same, but we just want to list it. We’re not doing anything with this right now except building a list.

Your third step is to consider your housing situation. I think what’s been funny about the pandemic is that the house became this central figure in our lives. We’re all home and now from the people who live in a high-density city with a teeny tiny apartment to people who live way out in the exurbs with lots of house, their relationship with the place where they were dwelling became their workspace and many other things and maybe like the landing spot for their kids or their parents. So, what I do think is that I think many people said, oh, well, this is the reason why I have a house. But on the other side of the pandemic, the question may be, do I really want to be here? Do I want to really be in this house? Do I really want to make sure that I’m moving more toward my family rather than away from them? And it’s just a way to kind of put a little placeholder on this thing called your house.

The fourth step of the fabulous five is to consider your spending habits. And I think that many people who call me and talk to me about, like, “Well, I’ll just spend less money when I do my reset.” I would be a little bit careful about that and I’ll tell you why. Because many people will say I’m going to spend less, and they don’t, and it’s hard to spend less unless you’re making like a real downsize. You’re moving from a 5,000-square-foot house, and I’m going to move to a cheaper state and much less room, it’s hard to really pull back on your spending. I do a whole chapter on consumption, but I think you really have to think about the fact that you’re probably going to be spending more than you believe you’re going to spend even with a reset.

And then, the fifth step is something we talked about, which is consider the obligations that you might have made to other people. These five things will help set that first tab of your financial life of your pink binder. They really will set the tone.

Ptak: Since you mentioned spending in the book, you note that one dimension of leading a healthy financial life is being thoughtful about spending that can help us spend less. Obviously, some of the spending for basic needs isn’t negotiable. But do you have any tips to share with people aiming to make their discretionary outlays really count?

Schlesinger: I think that what was so instructive about the pandemic is, I’m sure you guys heard from so many people, colleagues, friends, listeners, readers of Morningstar, where people were just piling up savings during the pandemic. It was estimated at $2.7 trillion of excess savings. Part of that had to do with the fact that some people got stimulus checks and excess unemployment, and the other part is that you didn’t have a lot to spend on. There’s just so much Bounty that anyone could buy and sanitizer.

So, what I thought was very interesting about the pandemic was that it kind of gave you this real-life lesson in, like, what is important? Yes, you have a safe place to live, and you pay your utilities and you’ve got your healthcare. But what else do you really need? Sometimes I talk to people and they’re like I live paycheck to paycheck. I’m like, is that including private school and your country club, because you’re including that? It seems weird that you’ve included that because that’s not exactly how I would define paycheck to paycheck. So, what I think is important is to at least question what you’re spending on and really determine what is the actual thing I must spend money on and what is it that I’m choosing to spend money on?

I think that there are a couple of other questions about spending that I put in this chapter about consumption, which is, sometimes people spend—and it’s really a psychological outlet—do I find myself guilty or am I insecure or am I anxious? Do I feel like just to go out with my buddies, I’m spending a lot of money, and that makes me feel weird because I can’t really afford it, but I don’t want to tell them I can’t afford it. Do I make impulsive purchases? I was going to put the story in the book, but my mother refused to let me. So, now I tell it everywhere I talk about the book.

When my grandfather was in the hospital, he was in the hospital for a long time and on and off at the end of his life. And I’ll never forget having this conversation where we were driving into the hospital. My father says to my mother, he goes, “Susan, I was just looking at the American Express bill and gosh, it was a real number. And I noticed that every store was within 10 blocks of the hospital. And maybe you’re spending because you’re just upset that your father is dying, which I understand. But maybe window shopping would be just enough. You don’t have to actually spend the money to do that.” And my mother, kind of, copped to it. She goes, “You know what, it’s so true, because I’m so anxious and I’m so worried, and it’s like I spend a little money.” And he said, “Well, you know, you can always return it. We don’t have to keep it either.” So, there was a funny thing about that that always stuck with me, which is, a lot of spending that we do is about something is going on and you spend, and you feel good in this moment. And then, it doesn’t make anything change. My grandfather was still dying, whether my mother bought a new outfit or not, and it didn’t really do anything. So, she actually stopped after that. And when my father was in the hospital, she goes, “It’s a good thing daddy is in the hospital and not in such a nice neighborhood, so I can’t even shop if I wanted to.”

I think that when you are choosing a partner—I feel younger people are so much better at this than in our generation. When I talk to my nieces and nephews in their 30s and they do seem much more aligned with their partners very early on about money. I just think it’s really interesting that we can pay attention to some of these tensions that will arise and how we might be able to help one another through them. It was an interesting thing. I tell the story about a friend of mine named Kelly, and she was talking about her engagement and when she got engaged during the pandemic and then her then-fiancé was like, “Let’s buy a house.” And she was like, “Oh, I don’t want to buy a house. I’m so scared because my father lost his house.” And there was all this stuff going on. But it was really interesting that the couple came together in a way and talked about the idea of making this splurge for a home and talked about it in a way that was really constructive without saying well, this is just what I want to do. And having open dialogue about those things is so much more nurturing for a relationship and it just leads you to the right conclusion.

Benz: Jill, in the context of spending and budgeting, a question that comes up is whether people need to do that line-item-by-line-item tracking of their spending, or can they just forget that and set a savings target and reverse-budget and anything left over they can spend and not worry about the specifics of it? How do you suggest that people approach that?

Schlesinger: It depends on your personality. It really does. So, what I have found is that if you go through the process of actually looking at how you are really spending your money, it can be embarrassing, not to anyone else but to yourself. And it can be mortifying in some ways, like, I’ve never really done that. What I would suggest is, I think it is a better way to just approach the process is to get a sense of—I’m not saying, oh, this is my shoe budget; but this is my discretionary fluff stuff. I put shoes in one month. It was a fancy dinner in the other month. I bought a beautiful bunch of flowers 14 times for my loved one, whatever. But just pick that. You can put the fun category and just put it out there and try not to judge it. And then, the only reason why I say understanding what the actual spend is helps me at least and I think for certain people like me. I’m a money person. So, it helps me make it concrete. What is that squish factor? What do I have? And I do think that there are plenty of people who make a lot of money usually and they know that they’re fine. They’ve run their retirement numbers. They’re saving a lot of money, and they want to blow a bunch of money doing something, then fine.

But if you feel like you want to be a little bit more part of the process, I do think that figuring out the actual what you’re spending money on without saying I’m going to draw up a budget, but just to be more mindful of it, can help you prioritize. I’m not saying what your priorities should be. I’m not a finger-wagger at all. You guys know me. I don’t really care. You could buy a latte 15 times a day as long as you’re hitting your retirement numbers, I could care less. You’re not going to become a millionaire if you stop drinking lattes, by the way. But I will say that I think that there is a sense of control sometimes that you can give yourself. I’ll tell you what, I feel somewhat more worried about people who are so deep into the numbers that they just don’t allow themselves to spend. So, sometimes I’ll tell people to cut back on the analysis and have some fun and spend your money. Because life is short, and that you want to have some fun and you want to have fun along the way. So, what works for you, works for you, and I don’t have a preference one way or the other.

Ptak: Your book has a chapter that’s playfully titled “Bully Your Boss” about how workers have more power than they’ve had in decades. Would you say that’s still true given how recessionary worries have recently come to the fore and some industries have had actually had layoffs?

Schlesinger: I think that you have to know where you are in an organization. I think that there are certain firms that are still hiring. And I still believe that workers have—I’m not going to say unlimited leverage—but I think that workers probably have more power in certain areas than in others. So, when I talk about bullying your boss—I’m not a bully. I never have been, by the way. It’s just an acronym. I think it’s probably the right steps to have, whether we are in a recession or whether we’re in the high times, but it is really about how do you approach somebody who is in power and actually advocate on your own behalf. And I want to be clear that you have to know the landscape. If you work for Meta or you work for a media organization that’s downsizing and you’re about to ask your boss for a raise, you better really have the goods to ask for that raise. I’m not saying you won’t get it, but you better ask yourself, is this the right time?

And part of the process of bullying your boss, I think, is making sure that you figure out what you want. If you’re somebody and you’re like, well, I know I’m valued by my boss. The mantra of the company is, we want more people to come in every single day or four days a week. I really can argue for being home two days, not one day a week. And if that’s what you want, you can go in and you can figure out how to ask for it. If you want to figure out whether it’s the time or not, like, again, if you work in technology, now is not a great time. But I was just sitting at a big aerospace conference of aerospace engineers, and they are desperate to hire as many people as they possibly can. So, there are industries that are hiring like crazy. And the engineer that used to work at Facebook may end up working at Raytheon and you don’t know where your next step is. But if you figure out what you want, understand what is the landscape of your organization, of your industry, of your sector and the company you’re working for, you lose your ego. You try not to tie so much of this and take everything so personally and you give yourself a little bit of grace, I think, that’s what I would say. And then, if you practice your conversation, you leave enough time and you don’t screw it up and you don’t make a pound-on-the-desk ask, do I think that there are places where you can get money? Absolutely. Do I think it’s going to become more difficult as the economy slows? Absolutely.

Benz: All these situations are different, but if someone is making a pitch about something they want, an employee, whether it’s more money, the ability to work from home, different responsibilities, whatever it is, do you have any tips to share about how they can actually negotiate for that thing or things that they want?

Schlesinger: First of all, one of my favorite things that I’ve learned in reading about negotiation is to really do your homework. I think that people who are in positions of hiring appreciate that. On the other hand, I think that sometimes workers, they’re sort of myopic in their view. Sometimes I have talked to people who are hiring. And they feel sometimes like they’re raked over the coals when the times are good. I’ll tell you a funny example of this.

I live in New York, so I have a lot of friends and relatives who work in investment banks. And one tip I would have is to be careful not to hammer your boss into submission and understand that things can change pretty rapidly. Like, I’m writing this book, and everyone is talking about the great resignation, the great reshuffling, and here we are months later talking about maybe there’s a recession. So, there was somebody I knew who was the boss of this very well-paid Wall Street lawyer. And the Wall Street lawyer said, “I know that so and so is leaving the firm and making a lot more money and that person is junior to me, and you hired that person back and you know what, I really want more money.” And in the year 2021 and 2022, that person was rewarded with a very big bonus. And in 2023, she was one of the first round of layoffs.

What I would say to that is be careful because if you are seen as the person who is trying to squeeze a lot out of your boss, and your boss has a memory, and you have a memory. So, I would try to really be careful about figuring out what you want. Understanding the situation can be very fluid. And maybe leaving some money on the table sometimes for other things that don’t cost as much, and that could be flexibility and that could be maybe education, that could be a lot of different things. So, I just think that if you’re using a framework where you’re looking at a range of salaries and you go out and you say, OK, I looked at and I saw that every single person who is on the air, on television, doing what I do, Jill, makes this. But I have certain things that I want in my life that are more important to me than money. All of us have different motivations. And I would be careful to be clear about what your motivation is and what you’re really going for. Again, just remember, your boss has a boss. Your boss is under pressure and your boss has a memory.

Ptak: Your work puts you in regular contact with individual investors. It’s, of course, hard to generalize, but what are you hearing from people about how they’re feeling in the wake of the simultaneous selloff in stocks and bonds in 2022?

Schlesinger: I presume we’re not allowed to curse on this podcast, right? That’s what people are feeling, like, oh, darn it. But use a different word.

Listen, last year was a terrible year. And I think for many of my listeners and viewers, I think what last year taught us was that every so often the rule of thumb is thrown out the window and it hurts like heck. It really does. So, it was one thing to be, like, the stock market plummeted. But if you had the bond market rallying and you’re a diversified investor, you’re like, OK, that stinks; it doesn’t stink as bad as it would have if I were 100% in stocks. Most of the people—and this is a self-selection process—most of the people who listen to a show like mine or a show like yours, I don’t think are the type of people who expect every single year to be a winning year. But I think that last year’s bond bloodbath was the most unexpected and scary part of the process that they have lived through.

That said, I do think that if you are somewhat long-term in nature, it is easier to look past this. My dad was a trader on Wall Street, a low-level guy before peak traders made a lot of money. And when I was first trading, I was trading gold options in the late ‘80s and the market was all over the place. It was kind of easy to make money, but then there was just a horrible year where everybody just got killed. And I remember having a night where I was like, “Dad, you’re not going to believe this. I lost so much money. This is the worst.” And he said, “You know, honey, I want to remind you that when we talk about being a seasoned investor, seasoned isn’t just moving through the seasons. I want you to think of how you season a piece of meat. You pound it and you pound it, and you pound it. And until you take enough poundings to realize the lessons that you’ve learned, you will feel really bad.” And I would say that there were so many years where interest rates were so low for so long and people thought that bond prices only went up and that 1994 was this unicorn bad year and we’d never see another year like that, and we just got reseasoned last year as investors.

Benz: So, now that rates are higher, how would you suggest that people take advantage of higher yields to improve their financial situations in addition to the obvious things like shopping around if you have cash investments? Anything else that people should have top of mind?

Schlesinger: There’s two things that I keep thinking about in this whole process. And as we come off of the failure of Silicon Valley Bank and Signature Bank and Credit Suisse, when you hear a lot of officials—like Federal Reserve chair, Jerome Powell, said that was just lousy management, and there was bad risk oversight. I would say that one of the things to think about is when you are in a very, very low interest-rate environment, many people will reach for yield. They will go into more esoteric products. And it doesn’t even have to be crazy. It just could be instead of having these very boring bonds over on one side, I’ll push out the type of bond and make it a little riskier. I’ll push out the maturity or duration. I’ll push that out. I’ll get a little more interest. So, I think that that’s like the natural trap we fall into in that environment. The converse trap is that here we are in a higher interest-rate environment, and you presume that interest rates will stay high forever.

So, what I will say is, I am still a boring diversified bond person. I still think that for all of the craziness and trying to figure out where you should try to lock in, what you should try to lock in, generally speaking, I don’t like taking big bets on directions, sectors, or yield-curve decisions. I like to be really middle of the road. I am very boring when it comes to that. And I think that for a lot of people, if you live in a high-tax state, I still think that municipal bonds—when people were like all these municipalities are going broke, that’s when I was like, maybe, but I’m just going to keep reinvesting and buying some more New York triple-tax-exempt bonds, because that works for me. And that’s what I was telling people to do.

I think that one of the critical ways that you can determine whether or not you’re going to be a successful investor is your ability to stick to your game plan and not to veer off when market conditions change. So, I would generally tell people what were you doing five years ago, let’s go look at that. Was that the right move or was that not the right move? Not a market move. Was it the right financial planning move for you to hit your goals? And I wouldn’t try to veer off and try to find the Holy Grail. I’d be very careful about people who are like, I’m buying the bottom of the tech boom. OK, sure. Like, you want to allocate some portion of your money and say, you think where the bottom of something is going to be, great. Good luck. Just take whatever portion of your investments represents the money that you’d be willing to lose forever, and you can allocate it to that, and it could be 5%. If you want to say I got a million bucks in this account, I’m going to take a $50,000 flyer on these three things, great. Go do it. But if you’re telling me, it’s $500,000, then I’m nervous.

Ptak: In the book, you note that the pandemic made you a little less obsessed with telling people to save and defer gratification into the future, that you’re putting more weight on the here and now. Could you share an example maybe even from your own life?

Schlesinger: I used to be a little bit more of “this is the answer.” This is the answer. I’m a certified financial planner. I have lived through market cycles. Here is the answer. I think that now I’m more interested in hearing about what is it that you want to do, you on the other end? So, Jeff, if you call me up and you say, “Here’s what I’m thinking. I know that it’s the dumbest thing in the world to pay off my mortgage. I know that. But it still bugs me to see that darn statement. I have all of my financial planning done, all my retirement goals. Can I make a dumb decision with some of this money?” I’m like, “Yeah, you know what? Nothing bad is going to happen. You don’t have to maximize every single dollar.”

I did come around to this idea, like, even with crypto, which I’ve never owned. My first crypto story for CBS News was when bitcoin went above $1,000. So, believe me, I’ve left plenty of money on the table and opportunity as well. So, I’ve known about it. I never understood it. I never bought it. But when people say they want to try something, they want to kind of nibble at a new technology, a new company, I’m a little bit less hardcore about, “That’s the stupidest thing in the world. Don’t do that.” I just say, “Commit what you can afford to lose to it and enjoy yourself.” If that’s kind of your fun, great. My mom has a friend. She day-trades stocks from 9:30 in the morning till noon. And then, she goes and plays bridge. I consider them pretty much the same activity. And I’m like, “Aunt Judy, you know, you could lose money.” She is like, “I don’t take my real money. If I lost it, I would do it.” But it’s kind of like the same thing. I’m not going to tell you what to do. You tell me what you’d like to achieve. Let’s figure out the way you can do that and keep doing a lot of the things that you want to do as well.

Benz: Jill, as always, this has been such a fun and illuminating discussion. Thanks so much for being with us today.

Schlesinger: I cannot thank you enough, and I love being on with you guys. You’re great.

Ptak: Thanks again.

Benz: Thank you for joining us on The Long View. If you could, please take a moment to subscribe to and rate the podcast on Apple, Spotify, or wherever you get your podcasts.

You can follow us on Twitter @Christine_Benz.

Ptak: And @Syouth1, which is, S-Y-O-U-T-H and the number 1.

Benz: George Castady is our engineer for the podcast and Kari Greczek produces the show notes each week.

Finally, we’d love to get your feedback. If you have a comment or a guest idea, please email us at TheLongView@Morningstar.com. Until next time, thanks for joining us.

(Disclaimer: This recording is for informational purposes only and should not be considered investment advice. Opinions expressed are as of the date of recording. Such opinions are subject to change. The views and opinions of guests on this program are not necessarily those of Morningstar, Inc. and its affiliates. While this guest may license or offer products and services of Morningstar and its affiliates, unless otherwise stated, he/she is not affiliated with Morningstar and its affiliates. Morningstar does not guarantee the accuracy, or the completeness of the data presented herein. Jeff Ptak is an employee of Morningstar Research Services LLC. Morningstar Research Services is a subsidiary of Morningstar, Inc. and is registered with the U.S. Securities and Exchange Commission. Morningstar Research Services shall not be responsible for any trading decisions, damages or other losses resulting from or related to the information, data analysis, or opinions, or their use. Past performance is not a guarantee of future results. All investments are subject to investment risk, including possible loss of principal. Individuals should seriously consider if an investment is suitable for them by referencing their own financial position, investment objectives and risk profile before making any investment decision.)