Financial Fitness with The Money Doctor, July 5, 2026
Financial Fitness With The Money Doctor with Frances Rahaim, Ph.D. "The Money Doctor"
Financial Fitness – Q&A - Money Doc in the Hot Seat!
What happens when real financial questions come in live — and there’s no script?
In this episode of Financial Fitness with The Money Doctor, Jess fires unscripted money questions from viewers, and Dr. Frances Rahaim responds in real time with thoughtful, practical, and often surprising answers.
No canned advice. No one-size-fits-all solutions. Just honest questions about money — and deeper conversations about what’s really going on beneath the surface.
Topics include:
• What to do when you owe more than your car is worth
• Whether to pay off debt or save for retirement first
• How to know when spoiling your grandchildren is financially harmful
• Talking with your adult children about money survival - for you both
and more.
What makes this show different is context. The right financial answer is rarely just about math — it depends on the whole picture. That’s where clarity begins.
Learn more at HugYourMoney.com.
Show Breakdown:
Money Questions, Real-Life Pressure, and the First Steps Toward Financial Control
Real Questions From Real Financial Lives
In this episode of Financial Fitness with the Money Doctor, host Dr. Frances Rahaim joins co-host Jess Tyler for a listener Q&A focused on practical financial problems that are also emotional, relational, and psychological. Jess explains that Frances has not seen the questions in advance, which gives the show a spontaneous, real-world feel. The episode addresses credit card debt, emergency savings, retirement worries, adult children needing support, upside-down car loans, Social Security timing, grandparent spending, buy-now-pay-later services, and anxiety around opening bills.
Credit Card Debt Versus Emergency Savings
The first listener, Melissa from Greenfield, asks whether she should use her $1,000 in savings to attack $6,000 in credit card debt. Dr. Rahaim advises against draining all savings to pay the card, even though the interest rate may be high. She explains that without emergency reserves, the next unexpected expense may simply send the person back to the credit card. Her advice is to balance both priorities: continue building cash reserves while also sending something extra toward principal, but only after tracking real spending and understanding how the debt was created in the first place.
Starting Retirement Savings at 48
Kevin from Turners Falls asks whether it is too late to make a meaningful difference if he is 48 and has very little saved for retirement. Dr. Rahaim says it is never too late, but stresses that “meaningful” needs to be defined carefully. She explains that if someone is carrying debt, especially a mortgage, car loan, credit cards, or student loans, then paying down debt strategically may sometimes function like retirement planning because it frees future cash flow. She encourages people to compare scenarios: saving while carrying debt versus using structured debt-reduction strategies that eventually open up more room for retirement contributions.
Helping Adult Children Without Sacrificing Retirement
Donna from Shelburne Falls asks how to help an adult son who is struggling financially without damaging her own retirement. Dr. Rahaim says this is one of the hardest questions for parents because they are used to putting children first. She advises having an honest adult-to-adult conversation, explaining personal retirement limits without blame, and inviting the child into a cooperative plan. Rather than continuing to act as an ATM, she recommends shifting toward a “buddy system” where both parent and child work on financial improvement together, while the parent avoids lecturing or shaming.
Upside-Down Car Loans and Social Security Timing
In the second half, Mona asks what to do when a car payment is consuming too much of her paycheck while she owes more than the car is worth. Dr. Rahaim explains several options, including repossession, refinancing or recasting the loan, trading the vehicle and rolling negative equity into another loan, or selling the car and borrowing only enough to cover the shortfall. She says repossession is often the path people fall into, but it damages credit and may still leave a balance owed. Tom from Colrain then asks about taking Social Security early versus waiting. Dr. Rahaim says the decision depends on need, health, life expectancy, and personal circumstances, but all things being equal, she tends to favor waiting because benefits rise by roughly 8% per year.
Grandkids, Buy-Now-Pay-Later, and Hidden Financial Patterns
Nancy from Gill asks how to know when spending on grandchildren is beginning to hurt her finances. Dr. Rahaim says the fact that she is asking the question may already mean it is affecting her mentally or financially. She recommends small pullbacks, teaching children money skills, and using tools like spend-save-share jars rather than abruptly cutting them off. Ashley from Millers Falls asks about buy-now-pay-later services for clothes and household items. Dr. Rahaim warns that these payments can layer quietly until they become unmanageable, comparing them to the frog-in-the-pot effect. She emphasizes awareness, visibility, and understanding how companies use immediate gratification to encourage spending.
Anxiety, Avoidance, and One Small Change
Jason from Orange says his finances are a mess, but he avoids opening bills and checking balances because it makes him anxious. Dr. Rahaim says many people, including wealthy people, experience money anxiety in different ways. Rather than telling him to immediately open every bill, she recommends changing one small, non-threatening thing first, such as taking a daily walk. That positive experience can build confidence, which can later be applied to money tasks in small steps: first bringing bills to the desk, then opening them later. She closes by encouraging listeners to send questions to info@HugYourMoney.com or through Jess, and reminds them they can reach her office by phone or visit HugYourMoney.com.
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“Financial Fitness with The Money Doctor” is a weekly, hour-long National radio show devoted to helping individuals and small business owners better understand their finances and the psychology involved in why we make the decisions we do, how it affects our relationships, our sense of self-worth, and most importantly what we have the power to DO about it! Even prior to this current, highly timely expansion including with BBS Radio TV, which is syndicated to every major audio portal on the world wide web (150 locations reaching every corner of the world), including iHeart, Google, Apple, Amazon, Alexa, etc..., the show enjoyed long-term success in Western MA, Southern VT and NH on WHMP, WHAI, BEAR Country and other SAGA stations, with Dr. Rahaim as a sought-after guest and contributor on News and other talk programs.
Dr. Frances Rahaim’s loyal audience loves her no-nonsense, diplomatic, if sometimes controversial approach to helping sort out difficult issues surrounding effective debt management, successful budgeting, and truly holistic retirement planning and beyond. She has an uncanny ability to translate financial jargon and confusing topics into every-day easy language, engaging her listeners and disarming the stigma around talking openly about money. Rahaim, and her cohost Jess Tyler, Program Director/Morning Show Host WHMP Northampton, banter passionately about real-life, everyday money matters. Nothing is off limits! College, student loan crisis, 401k dos and don’ts, marriage, divorce, insurance, going solar, buying a car, starting a business, you name it. It’s all fair game -- political, economic, and social topics that affect us all, and ALWAYS, what you can DO to give yourself the edge.
In 2008 Rahaim started PowerDownDebt, Inc. right in the middle of the housing bubble. Four years later, she formed HUG Your Student Debt, Inc. to address the crisis not only for students but for parents struggling to retire under the weight of their children’s and often their own college loans still. At 43, with 20 years of experience as an Independent Broker / Registered Investment Advisor, Frances developed a way to address the elephant in the retirement room – becoming 100% debt-free including mortgage, student loans, credit cards, every type of debt, has broad reaching effects on RETIREMENT! Nest-eggs grow faster and last longer without the burden of debt. Today, Dr. Rahaim’s fully dynamic HUG Your MoneyTM software is patented, and she is continuously working on new developments and financial tools to help the public.
What led a top Investment professional to shift her focus toward debt? $10,800 monthly going out in mortgages and business loans, throwing extra money at it and still no real light at the end of the tunnel. In solving her own problem, she found the missing link to retirement planning – the one thing no advisor wants to talk about. The key element that changes everything you THOUGHT you knew about retirement -- liabilities. Now, financial advisors train with her to utilize this path to retirement dollars and help clients, even ones who thought the ship had sailed, get a second chance to reach their goals.
Frances doesn’t just talk the talk, she LIVED this stuff and her listeners get that. They FEEL it! Their comfort level with her non-judgemental approach and down-to-earth demeanor invites questions you never thought you’d hear anyone admit to or ask on the air!
Whether her listeners are interacting or listening in on their neighbors’ stories, this lively show holds their interest and fosters a loyalty rarely found in radio. Part financial, part domestic, part political, part entertainment, always ear-opening, informative and pragmatic.
Speaker Identification
Speaker 1 - Announcer / Program Voice. Identified from the opening and underwriting language introducing Financial Fitness with the Money Doctor.
Speaker 2 - Dr. Frances Rahaim / The Money Doctor. Confirmed by the user as the host and identified throughout the episode as the financial expert answering listener questions.
Speaker 3 - Jess Tyler / Co-host. Identified from the program introduction and the conversational Q&A role.
Speaker 1 - Announcer / Program Voice: Financial literacy and the human condition. Welcome to Financial Fitness with the Money Doctor, Dr. Frances Rahaim.
Speaker 2 - Dr. Frances Rahaim: You are not alone. My goodness, so many people, even if they did save a lot by age 48, may be getting a divorce, may have lost a spouse, lost a job, or may be helping their kids. There are all kinds of reasons why people in that age group do not have much put away for savings.
So the very first thing is, of course, you know I am going to say it is never too late. But he asked a very important thing: is it too late to do something meaningful? We did not say, “Is it too late to start?” It is never too late to start. Is it too late to do something meaningful? No.
Speaker 2 - Dr. Frances Rahaim: Hi, it is Frances. I just wanted to take a minute to thank you for watching this video. If you are catching us on YouTube, please help us help others by clicking like, subscribe, and all notifications so you do not miss any videos. Check back for the next video. I think you are going to love it. Thanks again. For more information, you can visit us at HugYourMoney.com.
Speaker 3 - Jess Tyler: Welcome to Financial Fitness. I am Jess Tyler, along with the Money Doctor, Dr. Frances Rahaim.
Speaker 2 - Dr. Frances Rahaim: Hi.
Speaker 3 - Jess Tyler: Hi, Jess. I have not seen you in a little bit. How are you?
Speaker 2 - Dr. Frances Rahaim: I am doing well, and these are always my favorite shows because we are doing some questions and answers today.
Speaker 3 - Jess Tyler: Well, questions at least. We will see if I have the answers. So yes, I love to do these too, because they are real. These are questions that people ask all the time and that I do not get a chance to answer one-on-one for everybody. So to air them like this is a nice way for us to be able to just chit-chat and get down and dirty with some real financial questions. They are not always really financial, either. A lot of the time they are emotional or psychological, or they are just about, “Why does my partner not get it? Why am I like this? Whose fault is this?”
Anyway, I want to remind everybody too that I do not tell you what these questions are ahead of time, the ones that I get. So you are just on the spot and flying from the hip, I guess.
Speaker 2 - Dr. Frances Rahaim: Living on the edge.
Speaker 3 - Jess Tyler: Exactly. Are you ready to dive right in?
Speaker 2 - Dr. Frances Rahaim: Sure. Bring it on.
Speaker 3 - Jess Tyler: Let me get over to our first listener question. All right. This is from Melissa in Greenfield. She says, “I have about $6,000 in credit card debt, but only $1,000 in savings. Should I throw everything at the cards, or keep building my emergency fund first?”
Speaker 2 - Dr. Frances Rahaim: Well, I wonder what we are going to tell her, Jess. I know the answer to this. Do not throw everything at the card, but let us get into that a little more deeply.
Your logic tells you, “Wow, I am saving at 4% and I am spending at 29% on my card,” or whatever. “Why do I not just throw this at the card?” But if you really think about this, the reason you have $6,000 in credit card debt and only $1,000 in savings is because you probably do not have quite enough money coming in to handle surprise expenses, holidays you did not plan for, keeping up with the Joneses, or whatever. So you ended up with this $6,000 of credit card debt.
Here is how I want you to think about this. First of all, the very first thing is that I think it is ultimately important that you have emergency cash reserves. So I would say keep building your cash reserves, but I am going to balance this out a little bit. You want to try to do both things.
If you only have that one debt, if all you have is that credit card debt, then honestly, Hug Your Money is not going to get you out of debt any faster, except for probably the budgeting and coaching parts that we do, which might substantially help.
Speaker 3 - Jess Tyler: Yes, but the software is not going to work faster with only one debt.
Speaker 2 - Dr. Frances Rahaim: But once you have two or more, it will help you.
Speaker 3 - Jess Tyler: Which most people have, by the way. Maybe even this person.
Speaker 2 - Dr. Frances Rahaim: So let us suppose they only have that one debt. It is $6,000. You only have $1,000 in savings. I have already said do not throw all your savings at the credit card debt, but balance it out. Step one is, let us say that she is, or they are, right now saving $50 a month, and that is how they are building that $1,000. Maybe you split that. Maybe you save $40 a month, and $10 a month extra goes to the principal of your credit card. Try to balance it out in that way.
But before you decide any of that, do some reality tracking. Check your real budget, not what you think you spend, not your hard expenses, but the actual money that you spend every day for at least a month, two months, or three months, so that you understand why you built up that credit card debt. Not just, “Well, I needed a refrigerator, and that was a problem.” Because if you needed a refrigerator, that should have come out of cash reserves if you had a real vision of everything you were spending.
Speaker 3 - Jess Tyler: Okay.
Speaker 2 - Dr. Frances Rahaim: All of that being said, I understand that you want to pay off that high interest rate using your savings. But if you deplete your savings, the only thing that will happen is that the next time you are in this position, if you have not tracked reality and set up a real budget you can live within and built some cash reserves, you are going to be back into the credit card again.
Last but not least on this question, this is going to seem a little strange to people when I say this, and it is not the only thing to think about, but think about it this way. Your $6,000 credit card is probably charging you about $120 a month in a payment, up to maybe $240 a month in a payment. But let us suppose she had $6,000 in savings to throw at it. How long would it take her to break even at $120 a month? How many $120-a-month payments would she have to make before she broke even on that $6,000 she depleted her savings by?
Yes, it is way oversimplified, but what I want you to start thinking is, “Wow, if it takes, let us say, five years before I have recouped basically my $6,000 that I gave up in savings, was I able to save that money up again in five years because I do not have that credit card payment?” Probably, it is a wash.
That strips away the high interest rate. I know it is overly complicated. Here is the simple down and dirty: do not send all your cash reserves to that credit card. Balance it out, track reality, and start to think in terms of, “If I do give up my savings, will it really solve my problem? Will $120 a month back in my pocket really solve my problem, or am I just trying to stamp out a fire? I do not like that credit card. It has a high interest rate. I should get rid of it.”
Speaker 3 - Jess Tyler: Should you be making sure, though, that you are paying more than just what that interest is every month, toward your principal?
Speaker 2 - Dr. Frances Rahaim: Ideally, yes. But if you do not track reality, you do not know if you can really do it. A lot of times what people do is they send extra because they do not know that they cannot. It seems like it is in the account, and then something happens. There is not enough money. This is the cycle that everybody complains about: “How did I end up in this place?” This is how you ended up in that place.
Speaker 3 - Jess Tyler: Yes, right. Okay. Next one. Kevin from Turners Falls asks, “I am 48 and barely have anything saved for retirement. Is it too late to make a meaningful difference, and where should I start?”
Speaker 2 - Dr. Frances Rahaim: Okay. Thank you.
Speaker 3 - Jess Tyler: You are welcome.
Speaker 2 - Dr. Frances Rahaim: Welcome to America, Kevin. You are not alone. My goodness. So many people, even if they did save a lot by age 48, may be getting a divorce, may have lost a spouse, lost a job, or may be helping their kids. There are all kinds of reasons why people in that age group do not have much put away for savings.
The very first thing is, of course, you know I am going to say it is never too late. But he asked a very important thing: is it too late to do something meaningful? We did not say, “Is it too late to start?” It is never too late to start. Is it too late to do something meaningful? No. But you need to define meaningful, and you need to be very, very careful about how you are doing it.
In fact, what is meaningful? Let us suppose that he is carrying some debt at 48. He probably is: maybe a mortgage, car payment, credit card, student loans. If you are carrying debt, your “retirement savings” dollars may actually be more meaningful paying off that debt, if you can do it with a very low effective interest rate.
So, like the first example, you do not want to take whatever you could be saving for retirement and just throw it at debt without a plan, because it is going to cost you a lot of money. If you do something like Hug Your Money, where the software is muscling that interest rate down to less than 3% in most cases, and you are paying all your debt off, including your mortgage, in about nine years or less, then that not only frees up dollars for retirement after that point, but along the way it opens up options to do what we were just talking about: balance that money out.
Let us say you have retired enough debt that it is $500 a month in payments you do not owe anymore. Maybe $300 goes to your savings, and maybe $200 continues to go to debt. But you have to do something, Kevin, in order for it to be meaningful. You need to analyze what is meaningful to you and then run the scenarios. What does it look like if I save this money and keep paying this debt? What does it look like if I pay off this debt first and then save for retirement?
Speaker 3 - Jess Tyler: Okay. Let us try to get one more in for the first half here.
Speaker 2 - Dr. Frances Rahaim: My answers are long.
Speaker 3 - Jess Tyler: No, no, it is fine. We talked about some of these questions being emotional, and this one is. Donna from Shelburne Falls asks, “My adult son is struggling financially and frequently wants help. How do I support him without jeopardizing my own retirement?”
Speaker 2 - Dr. Frances Rahaim: Wow. What a fabulous question, and well worded. That is every parent’s question. How does any parent who loves their children, like all parents do, watch them struggle and say no? Really, your role as a parent, at least up until that point, has been kids first, me second. But when you are in that time crunch, when retirement is looming, the child has more time to recover and improve their financial situation, and you have less. It is now time for the roles to start to reverse a bit.
Yes, they are struggling. It is easy for me to say, “Look, you are not helping them by paying things for them all the time, because someday you might not be around and they need to learn how to do this.” So the answer is: get them involved, believe it or not. The most uncomfortable thing is to talk to your kids about money, like, “Hey, I really cannot afford to do that.”
When they are little and you say to a child in a store, “No, we cannot afford that,” all the kids hear is “No.” They do not know what “afford” means. They do not believe you. They just say, “Mom or Dad just said no. That is it.”
Speaker 3 - Jess Tyler: Yes. I do not know why, but that is their go-to excuse.
Speaker 2 - Dr. Frances Rahaim: When your children are older and they are able to comprehend this, it is time to start talking to them about why this cannot continue long term. “I can help you for now in this way, but you need to understand that I am not going to be able to do it long term because I am facing my own timelines. Let us work together to figure out how we are both going to come through this well.”
In that way, you can kind of bond. Most adult children will really respect their parent for talking to them like this if you frame it that way: “Let us work together to figure out how we are both coming out of this clean.”
Then you talk to them about, “Let us start finding out what is going to change for you in the future. How will that happen?” Here is my caveat: do not put your parent hat on for this one. Do not lecture them about how they have to get a job, they should not have married that person, or they have to stop spending on lattes. Do not do it. It will not get you anywhere.
For resistance, instead ask them for their help as an adult son, daughter, or child. “It is uncomfortable for me, but I have to talk to you about this because I am now 65,” or whatever it is, “and I am wanting to retire. I am certainly not blaming you for this. You are my child and I love you, and I want to help you. But the best way I can help you is for us to figure this out together. Honestly, I need you to help me too.”
This is the buddy system. We are going to go on a diet together. We are going to go to the gym together. We are going to fix our finances together. If they will not do it, if they see you as the ATM, this is your wake-up call. If they will do it, then you are both going to get better together.
Speaker 3 - Jess Tyler: I am wondering too, if you are doing okay financially, should you still have a cutoff probably at some point with them?
Speaker 2 - Dr. Frances Rahaim: You can teach them to fish, or you can give them a fish. I am sorry. It sounds hard. I know you want to help them forever. Some people have enough money that they do not care, but I have heard so many stories: “I gave my kid everything. I built this business for my kids. My kids do not want it. My kids just spend it.”
You have to do work ethic, financial stuff, moral stuff as a parent. You have to do it. It is your job. You have to do the hard job.
Speaker 3 - Jess Tyler: All right. Well, after some of the hard questions and easy questions and questions altogether, how do people get hold of you?
Speaker 2 - Dr. Frances Rahaim: If they still want to talk to me, they can reach us at 413-773-3333, and you can go to HugYourMoney.com.
Speaker 3 - Jess Tyler: We will be back with more questions and answers from the Money Doctor, Dr. Frances Rahaim, right here on Financial Fitness.
Speaker 1 - Announcer / Program Voice: Financial Fitness with the Money Doctor is underwritten by Franklin County Technical School. We build futures. Visit FCTS.us or call 413-863-9561.
Speaker 3 - Jess Tyler: Welcome back to Financial Fitness. I am Jess Tyler, along with the Money Doctor, Dr. Frances Rahaim.
Speaker 2 - Dr. Frances Rahaim: Hi.
Speaker 3 - Jess Tyler: Look how happy I am.
Speaker 2 - Dr. Frances Rahaim: Yes.
Speaker 3 - Jess Tyler: How are you doing with all these questions so far?
Speaker 2 - Dr. Frances Rahaim: I love this stuff. This is like a little town hall to me, without the political baggage.
Speaker 3 - Jess Tyler: Exactly. I have a ton of questions for you. This one is from Mona. “My car payment is eating up a huge part of my paycheck, but I owe more than the car is worth. What do I do?”
Speaker 2 - Dr. Frances Rahaim: Yes. Wow. That is a complicated one. There is no way to be quick.
Speaker 3 - Jess Tyler: Okay.
Speaker 2 - Dr. Frances Rahaim: It is eating up a big part of your paycheck, and it is worth less than you owe?
Speaker 3 - Jess Tyler: She says it is eating up a big part of her paycheck.
Speaker 2 - Dr. Frances Rahaim: If it is really dragging you down the rabbit hole, and you are looking at this car as something that is going to, in turn, cause you to fail financially in a bigger way, and you cannot fix it by earning more money, then you have to look at your options.
Option one is you stop making payments on it. I am not saying these in the order of preference. These are just different options. You stop making payments on it. It eventually falls into repossession. They come and tow it away. They take it.
Speaker 3 - Jess Tyler: Right.
Speaker 2 - Dr. Frances Rahaim: You hurt your credit. They take it to auction, and if it sells for less than you owe, you are still on the hook for the balance. Now you are paying on what we call a dead horse. That is an option. It is not my favorite, but it is an option.
A good option might be this, if she could do it. This is my favorite one. You do something called recasting the loan. Now, your lender might not call it recasting. They might call it refinancing or whatever. But let us say she has been driving this car for two years already, but she still owes enough that they might refinance it for a six- or seven-year loan. Even though I do not love those long car loans, because sometimes the car is dead before the loan is done, if she can do that, she could lower her payment and then throw it into a program like ours along with other debts if she has them, and still pay it off fast. So she gets the low payment, some breathing room, and she still pays it off way ahead of schedule.
Another possibility is she trades it in to a dealer. Now she is what we call upside down. Do you love these terms, dead horse and upside down? Now she is upside down. In other words, they take the extra that she owes on that car, and they put it on the new loan with the new car or used car. It gives you a sigh of relief for a moment, but it is not the best option. However, she could do the same thing with that. If she can get herself into an affordable payment, she can then put it in our program and pay it off ahead of schedule.
Last, of course, maybe not the last because I always have more, but there is one more idea, which is to simply sell it retail and come up with a small loan to pay off the balance. Then you are going to have to drive something else, use public transportation, borrow a car, or whatever is available to you. However you are going to handle your transportation after that, at least it might be, “Okay, I am out of the car, and I only have a $4,000 loan. I have five years to pay it off, and I can afford that. What am I going to do in the meantime? Am I going to drive a beater, borrow a car, carpool, walk, bike, whatever?”
Speaker 3 - Jess Tyler: Yes. Options two and three seem better than one because one seems like you can still be on the hook for money, and you are also going to have a worse credit score when you are trying to pay it off.
Speaker 2 - Dr. Frances Rahaim: I mentioned one because that is what most people do. They let it go to repossession. I think I said foreclosure like a home, but they let it go to repossession, and then that stuff happens and they are surprised that they still owe money at the end. “They repo’d my car. Let them chase me for the money.” Well, they are going to, and it is going to show up on your credit too, and you may end up owing that.
Speaker 3 - Jess Tyler: Okay. Tom from Colrain asks, “I am trying to decide whether to take Social Security early or wait. What factors should go into that decision?”
Speaker 2 - Dr. Frances Rahaim: Hey, Tom. One of the most common questions we get. This is a little flippant, but how long are you going to live? Because that is the answer.
No, nobody really knows. What we do know is that Social Security goes up by about 8% a year. So if you can afford to wait, I tend to lean toward waiting. But these are not cookie-cutter answers. Maybe it is better for you to take it now. Maybe you have some health concerns. Maybe you need the money now. Maybe it would drastically change your life now. There could be a number of reasons to take it now.
All things being equal, I would prefer that you wait until full retirement, because you will never make that money up again. But the argument from people, especially people who want to take it now, is, “Yes, but if I wait three more years, I get this much less money, and I never got all my money.” But unless you know when you are going to die, you do not know. So you balance things like that. Do I need it now for these reasons, or can I do it a different way? Because your savings probably are not growing at 8% a year, and Social Security goes up by about 8% a year.
Speaker 3 - Jess Tyler: Do you get people who are worried and want to take it now because of all the news stories about how it is going away or is going to be greatly reduced all the time?
Speaker 2 - Dr. Frances Rahaim: All the time. The scary part about that is a lot of them are working now. That means they may be falling into that tax bubble of, “For every $2 I make, $1 gets reduced,” and so on. You do not want to do this by panicking, that is for sure. Even if you did take it now, there is no guarantee that they do not change something and pull the plug on it.
Speaker 3 - Jess Tyler: That is uplifting. Okay. This is kind of similar to the other question that we just had. Nancy from Gill says, “I spend a lot helping my grandkids with clothes, activities, and everyday expenses. How do I know when generosity is starting to hurt my own finances?”
Speaker 2 - Dr. Frances Rahaim: You are already asking me.
Speaker 3 - Jess Tyler: Yes.
Speaker 2 - Dr. Frances Rahaim: That is so easy, because grandkids are even harder. They see grandparents as the lottery.
Speaker 3 - Jess Tyler: Yes. Or even if Mom and Dad say no, sometimes the kids think, “Oh, Mom could pay for camp for the kids.”
Speaker 2 - Dr. Frances Rahaim: That is exactly right. It may not be hurting her finances, but if it is on her mind enough to ask that question, it is hurting her mental attitude. She may be starting to feel a little taken advantage of.
Start to make small pullbacks. You do not sit down your grandkids and say, “Listen, I am not your ATM and I am not doing this stuff anymore.” You start to make small pullbacks. You start to teach them about spending their own money, like we were talking about with the son, where you are doing this together.
The next time the grandchild wants this or wants that, maybe, if they are old enough, you start setting them up with the Pablo the Pirate Cat spend, save, share jars for teaching kids about money. You can look us up on YouTube and look up Pablo the Pirate Cat, which is a cartoon about teaching kids how to manage money. You make it fun. You make it, “Okay, you have $2. Well, I will kick in the other $20.” Or whatever you decide. But get them involved.
The number one thing that I think almost anybody you speak to wishes had happened is that their parents had taught them about money. Instead, we shield them from money because we think we are being kind to them.
Speaker 3 - Jess Tyler: Not that I am an expert or anything, but another thing that I think maybe you could try is, if there are services you pay for now that they could do, exchange that. If you are paying someone to mow your lawn, say, “Okay, I will pay for this, but you do this.” Like a barter system, almost.
Speaker 2 - Dr. Frances Rahaim: Yes. Remind us how many children you have.
Speaker 3 - Jess Tyler: All right. This is one that I am seeing a lot. I see a lot of ads for these things. This is a great question, I think, from Ashley in Millers Falls. “I use buy now, pay later for clothes and household purchases because the payments seem manageable. Is that type of borrowing dangerous?”
Speaker 2 - Dr. Frances Rahaim: It can be. Yes, for sure. What you are doing is, this is a little graphic, but it is the scientific experiment of the frog in the pot of water. It seems really manageable when it is cold and the frog is swimming around, and then it gets a little warmer and the frog is going, “Hey, spa. This is cool.” The next thing you know, the heat gets turned up.
This sneaks up on you. You keep buying, you keep layering, you keep layering, and then all of a sudden the layered payments are too much for you to afford. I have no problem with the idea of making payments for something. I used to love the idea of layaway that they had at stores, where you did not get the stuff until it was paid for, but you still had payments.
Speaker 3 - Jess Tyler: Oh, there were the Christmas layaways every year. Remember?
Speaker 2 - Dr. Frances Rahaim: Yes. But the difference here is immediate gratification. You are not putting that money in a savings jar or savings account until you can afford that item. You get the item now and you pay later.
Just put your corporate hat on for a second and think, why would someone do this? This is why they do it: because they know that if they have to wait for you to save that up, you might not buy it. But right now, while you are excited, you can pull the trigger and buy it.
The only thing I would tell her is, again, this is about visibility. You have to be aware of what you can actually spend and when you are reaching that mark that is, “This is too much,” which is basically the answer to just about every question we had today: awareness. Ask yourself, “Do I know where my money is actually going?” Not, “Am I to blame for buying a latte?” This is triage before guilt every single time.
What we are really seeing here, Jess, and I talk about this a lot in The Quiet Pressure, is not random stuff. You just asked me a variety of questions that might seem random to someone. It is not random stuff. It is a pattern with leverage points, and it is driven by being uncoordinated. In other words, corporate America has its stuff together. They are coordinated. They know exactly how to play us.
We are on the other side going, “I do not know. I want to buy it now, pay it later. Maybe I can afford that car. What about my grandkids?” When you start to coordinate your finances and you are aware of it, we treat you first. We put guilt on the back burner. No judgment, no guilt, even if I sound judgmental in this. I am really not. We identify those patterns, both emotionally and financially, and then we coordinate a structure that applies leverage to speed up the process of financial improvement. If that sounds complicated, basically it means you have to be aware in order to plan in place and get better.
Speaker 3 - Jess Tyler: Those services, like Afterpay or Klarna, where you get to do that and they say it does not affect your credit, does it really not affect your credit, or is that too broad of a question?
Speaker 2 - Dr. Frances Rahaim: No, I think they do not pull your credit report.
Speaker 3 - Jess Tyler: Okay.
Speaker 2 - Dr. Frances Rahaim: “Not affecting your credit” is an interesting term. It caught my ear the second I heard it in an ad. It is very carefully worded. “This will not affect your credit.” What it really should say is, “We will not pull your credit report. We will not ding up your credit in order for you to get this.” That does not mean it will not affect your credit down the road in some way, obliquely. If you cannot make all the payments and you start to default on stuff, it will affect your credit.
Speaker 3 - Jess Tyler: Right.
Speaker 2 - Dr. Frances Rahaim: Awareness, awareness, awareness.
Speaker 3 - Jess Tyler: Do you want to squeeze one more?
Speaker 2 - Dr. Frances Rahaim: Yes.
Speaker 3 - Jess Tyler: Okay. Jason from Orange says, “I know my finances are a mess, but I have honestly been avoiding opening bills and checking balances because it makes me anxious. How do I get past the first step?”
Speaker 2 - Dr. Frances Rahaim: Wow. The key word there was anxious. He is not unlike a lot of people, and we all have some anxiety over something, I think. The thing people do not believe is that even very wealthy people have anxiety over money. It is just about different areas. They worry about who they are going to leave it to and how they are going to get taxed on it, things like that. Just about everybody has some anxiety.
I am not a therapist, but what I would say has been very valuable here is that you change one thing, and it does not have to be the scariest thing. I am not going to tell him to go to the mailbox and open up his bills. He knows to do that. He cannot do it. He is anxious. He does not want to do it. So that would be foolish for me to say, “Well, this is what you are going to change tomorrow. You are going to go and open up your bills.” It will not happen.
Instead, I want him to find something that he enjoys doing, even if it is not about money. If he likes to go for a walk, go for a walk. I know this sounds strange, but choose one thing and change it. One thing for yourself that you enjoy. Let us say it is going for a walk. He goes for a walk, and he enjoys the walk. All that tells him is there was some positive reinforcement. He chose one thing to change about himself, he did it, and it felt great.
That can translate into small steps about finance. Maybe a week later, after walking every day, he comes back from the walk and he thinks the whole way back, “When I get back, I am going to take the bills out of the mailbox. I am not going to open them. I am just going to put them on the desk. That is the step I am going to make.” The following week, he starts opening those.
You just have to fool your mind into being less afraid, less anxious of the thing that is scaring you the most. For me, it was singing. I am a vocalist and I have sung for years, but it took me two or three years of singing, with everybody telling me I looked really comfortable up there, to really be comfortable up there. Fake it until you make it. Nobody else knew it but me. But boy, did I know the difference when I crossed that path.
Really, treat yourself to something nice that you like to do and see how you feel. Then decide, “Can I apply that to my money in some way?”
Speaker 3 - Jess Tyler: All right. So many good questions. Thank you for taking the time to answer them. If you have a question, you can send it to J. Tyler at - where should I tell them to send it now? Bear953.com or WHAI.com? They do not send it to Franklin County now?
Speaker 2 - Dr. Frances Rahaim: Maybe they do now.
Speaker 3 - Jess Tyler: That is the thing. I do not know. I will put a link up with where they can send questions to. What am I going to do with the audio?
Speaker 2 - Dr. Frances Rahaim: If you have any, just give me some audio. It says, “If you have questions, you can email info@HugYourMoney.com.”
Speaker 3 - Jess Tyler: Okay, perfect. Or your Bear Country thing.
If you have any questions and you want the Money Doctor to answer them, you can email them to info@HugYourMoney.com, or you can email me at JTyler@Bear953.com. In the meantime, let us get your phone number.
Speaker 2 - Dr. Frances Rahaim: Sure. And I just want to be clear: if they email you, you are not answering the questions. You are just asking.
Speaker 3 - Jess Tyler: Yes. No, you will not like my answer. It would be like, “Go to Starbucks a couple times. Fine.” You would know it was me.
Speaker 2 - Dr. Frances Rahaim: Okay. You can reach us at 413-773-3333.
Speaker 3 - Jess Tyler: All right. Thank you. We will be back next week with the Money Doctor, Dr. Frances Rahaim, right here.
Speaker 3 - Jess Tyler: But I was there. I remember I had to be upside down on a car and going to my dad and going to the dealer, begging them for some solution. I ended up with this awful Subaru I hated. It was fine, but I was too young for it. I was like, “I am driving an old person’s car.” This was not a minivan. Big numbers of speed on the dash and digital. The numbers were 35 miles an hour, pedal to the floor. They got 36.
Speaker 2 - Dr. Frances Rahaim: Thirty-six. I can make it.
Speaker 1 - Announcer / Program Voice: Financial Fitness with the Money Doctor is underwritten by Hug Your Money. Permission granted for Chase Your Dream.
