Personal Finance for PhDs

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Jill Hoffman

Even More Reasons Not to Fund Your PhD with Federal Student Loans

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In this episode, Emily interviews Janna McKay, a Certified Student Loan Professional (CSLP) who works as a consultant for Student Loan Planner. They discuss the changes to the federal student loan program brought about by the One Big Beautiful Bill Act of 2025 that were implemented on July 1, 2026. For both continuing and new PhD students, Janna shares the federal student loan borrowing limits in play and the available repayment plans, emphasizing caution for graduate students who hold significant student loan debt taken out prior to July 1, 2026 who are weighing taking out another federal student loan with closing a funding gap in a different manner. Janna and Emily also discuss the updates on the Saving on a Valuable Education (SAVE) plan, how all the income-driven repayment plans intersect with Public Service Loan Forgiveness (PSLF), and the possible advantage to waiving deferment in favor of enrolling early in the Repayment Assistance Plan (RAP). This episode is a must-listen for any graduate student who is considering or will consider taking out a federal student loan going forward and any PhD or PhD-to-be who is currently holding federal student loan debt.

Links mentioned in the Episode

Even More Reasons Not to Fund Your PhD with Federal Student Loans

Teaser

Janna (00:00): I first want to acknowledge it is really hard to be a borrower right now and really hard to make the right decision. It feels like it’s an impossible task. Unless we see a new administration with new rules, which in my experience, we’ve had a new repayment plan every administration for the past five.

Introduction

Emily (00:25): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (00:54): This is Season 24, Episode 4, and today my guest is Janna McKay, a Certified Student Loan Professional who works as a consultant for Student Loan Planner. Janna and I discuss the changes to the federal student loan program brought about by the One Big Beautiful Bill Act of 2025 and implemented on July 1, 2026 that are most relevant to PhD students. For both continuing and new PhD students, Janna shares the federal student loan borrowing limits in play and the available repayment plans. She emphasizes caution for graduate students who hold significant student loan debt taken out prior to July 1, 2026 who are weighing taking out another federal student loan with closing a funding gap in a different manner. Janna and I also discuss the updates on the Saving on a Valuable Education or SAVE plan, how all the income-driven repayment plans intersect with Public Service Loan Forgiveness or PSLF, and the possible advantage to waiving deferment in favor of enrolling early in the Repayment Assistance Plan or RAP. This episode is a must-listen for any graduate student who is considering or might consider taking out a federal student loan going forward and any PhD or PhD-to-be who is currently holding federal student loan debt.

Emily (02:22): I’ve been casually recommending Student Loan Planner for years, and this is the third podcast episode in which I’ve interviewed one of their consultants. We are finally formalizing our relationship, and the key factor for me was you all getting a discount on their student loan consultation package. If you need a consultation after listening to this episode or in the coming years, please go through PFforPhDs.com/SLP/ to receive $100 off Student Loan Planner’s standard consultation fee. This is an affiliate relationship, so I’ll also receive a commission when you go through my link. However, like I said, I’ve been recommending them all along anyway and now you get a discount, so win-win-win if you are in need of professional advice on how to handle your student loans. That link again is PFforPhDs.com/SLP/. I’ll also add that there are tons of free resources, including very detailed calculators at StudentLoanPlanner.com. I highly recommend working with those calculators as you’re listening to this episode if you’re a current borrower or are considering taking out a federal student loan to translate what Janna and I discuss into concrete numbers that apply to your life. You can find the show notes for this episode at PFforPhDs.com/s24e4/. Without further ado, here’s my interview with Janna McKay of Student Loan Planner.

Will You Please Introduce Yourself Further?

Emily (04:03): I am delighted to have on the podcast today Janna McKay, who is a consultant with Student Loan Planner, and we are going to talk about all the recent federal student loan changes that are most pertinent to PhD students and funded graduate students. Um, this is actually the third time I’ve had a consultant with Student Loan Planner on the podcast. Uh, Meagan McGuire joined me in season seven, episode 13 and season 14, episode seven. But those were a lifetime ago and we have so many new things to talk about with respect to student loans. Um, I know this will not apply to everyone, uh, listening to this for various reasons, but if you’re willing, I would say stay on because you might save a life with some of the information in this podcast if you can pass it on to a friend that it is relevant for. So Janna, thank you so much for joining me on the podcast today, and will you please introduce yourself further for the audience?

Janna (04:50): Yes, thank you so much for having me. I’m so excited to be here. Um, so I’m Janna McKay, like you said, accredited financial counselor and certified student loan professional. But what’s more important to me, I’ve spent my entire career of over 22 years in higher education and I specifically work with applicants, students and alumni managing educational debt, understanding it, um, and also helping with financial wellness and confidence. So I still do. I work with PhD students, both stipend-based, and I’ve worked with tuition-based in the past. And so I really understand the tough place that we’re in and everybody’s in as far as funding goes, whether it’s funding in the lab, whether it’s how far the stipend goes. So I’m excited to be here to talk about the changes that are ahead.

Federal Student Loans for Grad Students Starting Programs in July 2026 and Beyond

Emily (05:33): Yes, and we’re really lucky to have you. So thank you so much for, um, being willing to come on the podcast. Now, we’re gonna divide this discussion into a few sections. So first, we’re going to talk about a new graduate student. So someone matriculating into a graduate program in July 2026 or following. Have some questions there. Then we’re gonna talk about a continuing graduate student who started their program prior to July 2026. Uh, in both those cases, we’re talking about a person who is considering taking out federal student loans. And then the third section we’re going to talk about, um, not someone who’s taking out new student loans post July 2026, but just someone who has existing student loans and what is going on <laugh> for that person. Uh so those are three sections that we’ll go through. Um so first for that person, new graduate student matriculating July 2026 or later, oh, by the way, I have to say today is July 8th, 2026, and maybe something will change after July 8th, 2026. So what you’re hearing is accurate as of today. Um, but obviously there’s been fast moving changes even in the past few weeks. Okay. So with that out of the way, we’re talking about someone who is matriculating to a new graduate program in July 2026 or following. Um, if they are thinking about taking out a federal student loan, if they do decide to take out a federal student loan, what are the borrowing limits that they’re subject to? This has been so confusing in recent, uh months. So yes, let’s start with that question.

Janna (06:54): There is no GradPlus loan anymore. So we just have to start with there is a lot of a big limit on funding and what’s available and how much is available. So no more Graduate Plus loan is a big one. But for federal student loans, that does leave us with the unsubsidized Stafford loan, which will have an annual limit of $20,500 per year and a lifetime limit of $100,000. So that is not going to go very far. And I wanna add another layer on top of this. There is something called loan proration where if you’re not attending full-time, you’re not eligible for the full amount, which complicates it even further. Um, and even financial aid offices are like, how are we gonna handle this except for recommending people go full-time all the time? 

Janna (07:39): So what can be tricky here is the limit does include prior borrowing. So if your program started after July 1st, we are looking at that lifetime limit of $100,000 for graduate students. If you have a previous master’s or doctoral program, that borrowing is included. So it’s not as easy in the past where you could pay down some of the funds, come back to school and be eligible again. You are looking at all past borrowing history, whether there’s an outstanding balance or not, that is going to limit what you’re eligible for.

Emily (08:12): Wow. And that was one of the points of clarification that I really wanted because it is so common, for instance, coming to a PhD program to have debt from the undergraduate to get their master’s degree, whatever had happened before that point. Really, really good to know that even if you paid down the debt, you’re still subject to that $100,000 lifetime borrowing limit. So listener, think for yourself, like, what are you already up to? How much have you borrowed in the past and how close are you, um, to the limit? And there may be listeners who are already over it. So maybe federal student loans are just completely out of the question, um, under this, under this framework.

Janna (08:43): If you do have the past borrowing history and we’re gonna get into different repayment plans, but you borrow again, it does exclude you from legacy repayment plans, which can be a deal breaker for some people. Um, I have certain people that have high borrowing from prior that are choosing a private loan as an option, for an example, because they don’t wanna lose access to certain repayment plans. So that’s another consideration, not just the limits, but how does this impact the other debt that I do have?

Emily (09:11): Yeah, let’s really hit hard on that. So let’s assume that a person does have some degree of past federal student loans, um, and they’re coming into this new degree program. Um, they’re subject to these new limits, the lifetime limit, the annual limit. Um, but they’re also, there’s also this change in the repayment plan. So if I understand this correctly, um, if they don’t take out a new loan, they still have access to what you just called the legacy programs. Let’s define more specifically what those are. Um, but if they do take out a new student loan, then they’re under the new options. So let’s go through what are the legacy options that, I’m sure it depends on the individual, but that might be available, um, if they don’t take out a new student loan.

Income-Based Repayment Plans for Federal Student Loans

Janna (09:50): Our most common one is the income-based repayment plan. So there are two versions of this, the new and the old. The new version, lower payment, it’s 10% of discretionary income with a 20-year term. The old version is a 25-year term. 15% of discretionary income is used for the payment. So it’s a more expensive plan, but it all depends on when you borrowed for the very first time. So the new version is for people that borrowed for the very first time on or after July 1st of 2014. Um, the old version is for anyone that borrowed before then. Okay? Um, but we also have the pay-as-you-earn plan and that is available, but it’s only going to be available for two more years. So it sunsets June 30th of 2028. Um, and something really important to know about income-driven repayment plans, um, they can be made through regulatory process, which is through rulemaking with the Department of Education.

Janna (10:43): That would be your pay as you earn, your SAVE plan. There’s income contingent too, but it’s not a very common plan that we see anymore. Um, but then we have the IBR plan, both the new and the old, those are made through legislative changes, so acts of Congress. Um, so it was easy with the bill that passed last July to get rid of the regulatory plans. But the ones that were made through Congress a little bit tougher because it would take a separate act of Congress to eliminate the income-based repayment plan, as an example. So those are legacy. And then when we talk about fixed repayment plans, our typical plans are the standard 10-year, which is your default repayment plan, highest monthly payment amount over 10 years. We also have a graduated repayment plan where it increases every two years or an extended 25-year term plan. So those are what we would call legacy plans.

Emily (11:35): And my understanding is that, um, with the, the income-driven repayment plans you mentioned, um, IBR repay and so forth, the idea there is that someone enters into that kind of a plan to get this lower monthly payment. They have the extended repayment term, but forgiveness comes at the end of whatever the term is. So it is a person who is not necessarily planning on paying off their loans in full, but is going for this forgiveness option. Versus the standard, the graduated, the extended plans that you just mentioned. That is a person who is planning on paying off the loans in full over whatever the term is at whatever the rates are, um, given the specific plan. So it’s like people who are going for forgiveness or people who are going for full repayment are sort of the two camps. Is that right?

Federal Student Loan Forgiveness vs. Full Repayment

Janna (12:21): Yes, exactly right. So the pay as you earn had a 20-year term, and some people might get there in the next two years. The new version of the income-based repayment has a 20-year term as well. And it doesn’t have to be consecutive. So I also like to think of it in qualifying payments. You have to have 240 payments there. Um, the IBR has 30 or 300 payments, excuse me, 25 years. And so you’re making the minimum payment, you’re getting forgiveness at the end, and that forgiveness may be subject to taxes, which is the other hot topic right now. Um, just because we had a tax exemption in place from 2021 through 2025 and it was not extended. So 2026 come, you know, tax season next year, we’re going to see the impact of taxation on loan forgiveness.

Emily (13:09): Okay. So to bring it back to the person who is considering taking out a new federal student loan, they kind of need to know, I guess, are they in a go for forgiveness camp or are they in a, I’m gonna repay this in full camp? That would help them with the decision-making here, right? Because the plans will change if they take out a new loan. And I guess we, we haven’t gone through the new ones yet. We need to go through the new ones. Um, but they really need to know, do I have to retain access to these old plans or is it okay if I am sort of stuck with these new plans? Is that right?

Janna (13:41): Yes. Very good point. I would say the majority of people either want the 20-year term and lower payment of the new version of the IBR and they want that forgiveness piece or it’s typically the lowest monthly payment out of old and new plans for public service loan forgiveness. So another example. Um, or they would rather have a 25-year term versus the RAP, which we’ll talk about. It has a 30-year term. So it’s a full-on mortgage term.

Emily (14:09): But we’re still kind of talking about people who have relatively high student loan balances. And I’m saying relative to their post PhD, post-done with graduate school incomes, right? People who have a pretty low balance relative to their future income are probably gonna be in the repay in full camp anyway, right?

Janna (14:25): Yes, exactly. Yep. And though, I mean, you have more options there and we would then be looking at what are your interest rates? How do you wanna prioritize paying this off? But more than often, it’s a fixed repayment plan so that it has predictability and gives them a little bit of flexibility with their cashflow.

Federal Student Loan Plans in July 2026 and Beyond

Emily (14:43): So let’s talk about the new set of plans. Um, if someone does take out a student loan July 1st, 2026 or later, then they are in the new regime. So what are the repayment options in the new regime?

Janna (14:53): We have two plans. So they’re thinking this simplifies things. Um, we have the fixed in this case as a tiered standard. It is a 10 to 25-year term based on how much debt you have outstanding at the time that you have, you enter repayment. And then on the other side, the only income-driven repayment plan available is the RAP plan or the repayment assistance plan. And there are good sides to this plan. Um, but I really see it working for very, couple groups of people where it’s beneficial. So nobody is going to borrow and think, “Ah, I’m gonna pay this back in three – 30 years,” right? And get some sort of forgiveness. Um, it’s drawn out so long that it makes that hard to achieve because our income goes up as our career goes. And I think it’s hard for people to be able to get forgiveness in that plan, really.

Emily (15:46): Yeah, that makes sense. Um, the, the term is so long, um, that you’re getting through those early stages of your career. I mean, that’s, that’s a full mortgage. That’s a age 30 to age 60 kind of situation making that payment the whole time. So it sounds like the math is working out that for a lot of people, even if they would prefer the lower payments, would prefer to have forgiveness, just it’s going on so long, they’re gonna end up with complete repayment at some point along the way if their income continues going up as kind of the average persons would.

Janna (16:14): Exactly. And so one thing I forgot to mention about the IBR is there is a ceiling on that plan. There’s a payment cap equal to the 10-year standard amount. And so we don’t see the payment going above that. There’s a hard stop. So you can make more money and it won’t impact the student loan payment. On the other hand, though, the RAP plan does not have a limit. If you make more than $100,000, it’s a straight 10% of your adjusted gross income. So that matters too. So when we look at RAP though, where I do think it’s helpful is for new grads where we are looking at you’re earning less. Um, the RAP plan has an interest subsidy where if your minimum monthly payment does not cover the amount of monthly interest that’s accruing, the difference is subsidized or paid by the government. And so we don’t have balance growth or negative amortization, which is really helpful early in the career. So that is a nice benefit of the plan. And really to use the plan for what it’s worth is that interest subsidy. Um, but I wanna note that if you make extra payments while you’re eligible for the subsidy, it just reduces the subsidy. So it’s not always beneficial. It’s more beneficial to save anything extra you’d be putting toward your student loans. And when you no longer qualify for the subsidy, pour that all into your loans.

Emily (17:31): I see. The new graduate student <laugh> coming in, considering taking out the federal student loan, they probably need to study all these systems. They need to know what their best option is under the old set of systems. Was it going to be, um, IBR, new old, or a different one? Which you said a couple of those are sunsetting in the, in the near future. So they might still even be in grad school, by the time the sunsetting happens. Um, versus the new set of plans. And they really have to weigh how important is it to my financial wellbeing at this moment to take out this federal student loan versus some of the other options that may be available to them for funding their graduate program or their living expenses?

Janna (18:12): Exactly. And short-term versus long-term planning, right? Short-term is getting you through your program, but then how does this impact me long-term as far as what does repayment look like?

Private Student Loans for Grad School

Emily (18:23): So let’s take the first scenario where someone definitely needs debt <laugh> for this new graduate degree. Um, but they, let’s say they’ve decided it’s not really a great idea for them to take out a federal student loan. What other options do they have?

Janna (18:36): So typically with that, we are looking at private student loans. That is the most common. Some states have different programs, but there isn’t, there aren’t a lot of options available to graduate students, not scholarships, um, and other sources that we usually see. There could be institutional loan programs that varies by institution. But aside from that, the majority are private student loans. So we’re looking at going into the private market. This is of course based on the privilege of good credit and the possibility of a co-signer. Um, but you’re going to be getting who knows what kind of an interest rate. We’ve had some people apply and get a six and a seven and then another lender gave them a 14. So it’s a little bit unpredictable. And it’s really new territory because they eliminated the GradPlus loan. Um, different lenders have had to come up with different products, which mean different credit criteria.So it’s gonna be an interesting time, but you do have to think about taking out a private loan is going to mean two separate payments at repayment, right? So how is that going to impact cashflow going forward? Because that will be part of the decision-making process too.

Emily (19:44): So it sounds like check with your state, check with university, but last resort may be this private market, which is, um, evolving and uncertain at the moment. And maybe shop around quite a bit <laugh> and see what multiple different lenders are trying, are going to offer you. Um, I think listeners, you know, longtime listeners in this podcast will know that I’m pretty debt averse. And so I’m gonna be asking you to look at a variety of other ways that you could possibly, um, fund your graduate degree, um, without resorting to debt. So that would certainly be like looking for assistantships at your university, applying for fellowships, applying for scholarships, um, talking with different advisors to see if you can get on, you know, a grant of theirs. Um, and even working on the side, which is, um, not great. It may take away from, you know, your focus on your graduate program. But if you really have a high-stakes decision here with a lot of prior student loan debt that you don’t want under the new system, and maybe you’re only looking at high interest rates in the private market, maybe that is gonna be the best choice. So there are a variety of options here. Um, but we just have to be so much more careful about those federal student loans than we did if we were still under the old system. Is that a fair –

Janna (20:51): Yeah, that’s completely fair. And I am with you. I would put private loans at the bottom of my list. I would look at every other option before that just because you really have to look into the terms and conditions of these loans to know what you’re getting into.

Commercial

Emily (21:07): Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, budgeting, or designing your financial life, each tailored specifically for graduate students and postdocs? I offer live workshops, asynchronous online courses, and cohort-based programs on these topics, and I’m now booking for the 2026-2027 academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, medical school, postdoc office, or postdoc association? My workshops are usually slated as professional development or personal wellness. The fall semester is an excellent time for any type of personal finance content. Ask the potential host to go to PFforPhDs.com/financial-education/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

Federal Student Loans for Grad Students Continuing Their Programs in July 2026 and Beyond

Emily (22:41): All right. Similar set of questions now, Janna, but different person. So this graduate student is someone who is a continuing, continuing in their same degree, um, across July 2026. But similarly, they are considering taking out a federal student loan. Maybe they came in with funding and the stipend is not sufficient for the living expenses. Maybe their funding source dried up because of a change in, in grants. We don’t know what happened, but they’re looking at a federal student loan as a continuing student. Are there any modifications you would need to make to your answer for the new student for a continuing student?

Janna (23:14): Yes. And this is all dependent upon did you borrow for this same program before July 1st? Okay. So if you did borrow a direct loan, any type, it could be unsubsidized offered, it could be graduate plus, you do have access to legacy provisions for up to three years or the completion of your program, whichever comes first. So it’s just important to know that means same loan types, same loan limits, business as usual, but you would had to have had a disbursement of a direct loan for your current program by June 30th of this, of 2026.

Emily (23:50): Okay. So if in… Let’s assume this is a PhD student. So if in their PhD up to this point, they had never taken out federal student loans, but they’re now looking at it, they would be in that first question as if they were matriculating for the first time. But if they had taken out a federal student loan for this program, not prior programs, for the current program, um, prior to July 2026, then they have these legacy options. Um, and so by legacy, you mean the borrowing amounts, right?

Janna (24:18): Yeah. I mean, borrowing amounts, um, the loan types that they have access to. The disbursement after July 1st, still same repayment scenario, right? You only have access to the new repayment plans when you borrow a loan after July 1st. But the limits… So the limits are still the $20,500, but the lifetime limit for a graduate student is $138,500 where the new limit is $100,000. So there can be a little bit more leeway there. Um, but also if they’ve used up all of their Stafford, unsubsidized Stafford limit, they still would have access to the Graduate Plus loan, which is the key for some people.

Emily (24:54): But if they take out the student loan July 2026 or later, then they are subject to the new set of repayment plans. Is that right?

Janna (25:04): Yes. It’s kind of a, you get caught in that, right? So-

Emily (25:08): So you’re allowed to borrow more, but you still have to repay under the new system.

Janna (25:12): Exactly. Exactly. Unless we see a new administration with new rules, which in my experience, we’ve had a new repayment plan every administration for the past five. So possible, right?

Emily (25:22): Yes. And that is really important for people listening to this anytime after the release date. You know, we’re on July 8th, 2026 and something could be different in the coming months, years, next administration. Absolutely. Um, and if you go back and listen to those prior episodes, by the way, that information’s now outdated. <laugh> So, um, they’re useful in terms of, like, understanding high level concepts, but not for the particular applications, um, any longer. Now I wanna talk about graduate students who are not considering taking out federal student loans. Let’s hope they never have to take out another federal student loan, but they do have existing student loan debt, um, all taken out prior to July 1st, 2026. Um, what is going on with them? Everybody is so confused. What is happening with SAVE? Like, um, as of this moment, right? Again, we’re in early July. So what, what’s going on with these prior borrowers under the new whatever’s going on now?

Emily (26:14): Right.

Janna (26:15): I first wanna acknowledge it is really hard to be a borrower right now and really hard to make the right decision. I feel it’s like it’s an impossible task. Um, let’s touch on SAVE first. So we have started seeing communications from loan servicers to the borrowers saying, “This is your 90-day notice.” Okay? So prior to then, they were coming from the Department of Education. They were like, “This is coming. This is coming. You should change.” But now it’s actually coming from the loan servicer that, okay, it’s time. Um, but not everybody is getting them at one time because I think it would be a logistical nightmare to process that many applications. So one example that I have is Nelnet as a loan servicer. They actually house almost half of all SAVE borrowers in the forbearance. And so they recently released on their website that they are gonna be notifying borrowers from July 1st through March of 2027.

Janna (27:09): You’re gonna fall somewhere in there, which is just more to me, a hurry up and wait. Like, I’m not sure when this is gonna happen to me, but you can still proactively get out of the forbearance if you’re ready. Um, but I know some people maybe filed taxes differently this year thinking it’s not gonna impact my student loan payments, but now it might, right? Uh, so we have that coming up. You’ll have 90 days to change plans and choose a different plan. And if you don’t choose a different plan, you’re going to be defaulted into a standard 10-year plan or a standard consolidated plan, which is typically a more expensive plan for most people.

Emily (27:45): Let’s keep on the assumption that we’re talking to a graduate student whose loans are in deferment. Okay. So maybe they never enrolled in the SAVE plan, okay? Um, if their loans are currently in deferment, what’s going on <laugh> for them?

Janna (27:58): So they can stay in deferment. Um, but I have been working with a lot of students that I don’t think know this, but you have the ability to opt out of deferment. Okay? And w – the reason to do this would be if you can opt out of deferment and go into the RAP plan. As an example, you have an interest subsidy, like we talked about. So the minimum payment in the RAP plan is $10. Yes, we would be looking at a loan payment. We would really wanna know what that payment is to see if it fits within our budget before making this decision. But the idea is you could finish your program with the interest subsidy, which means your balance isn’t growing for the duration of your program if you can fit that monthly payment in. So I think that is a good option.

Federal Student Loan Interest Subsidy

Emily (28:43): I actually wanna stay on that a little bit longer, um, because that was the subject, one of the key subjects that I talked about with Megan McGuire in season 14 episode seven when we were discussing the SAVE plan because the SAVE plan had this interest subsidy. The RAP version of it looks a litle different, but there’s still… The point is to halt the growth of the loan to stop the negative amortization that was going on that was so troublesome for student loan borrowers in decades past. So that is a really good thing, a great idea from SAVE, a great idea in RAP. Um, but as you were saying, there will be a payment, right? There was not necesarily a payment under SAVE, but there will be a payment under RAP, uh, $10 or possibly more depending on your income. And so I am very curious about this. So you are seeing that people are questioning, okay, even though I could be in deferment right now, I’m going to elect to start the RAP, make whatever the payment is as long as it’s affordable for them. And the reason to do this is because they’re planning on going for forgiveness, right? And finishing out the RAP and getting forgiveness. Um, and so they’re just starting the clock. Am I reading that correctly?

Janna (29:43): A couple, there’s a couple ways to think of it. Okay? So one could be I want the interest subsidy now because I know when I’m done, I’m gonna pay this loan in full, right? So I want the balance to stay the same today as it will be in three years from now when I graduate. So that is a great strategy… Um, and in addition to the principal or the interest subsidy, there is a principal pay down of a minimum of $10 per month so it’s going backwards a little bit. So it’s decreasing, which is nice. Um, it could be that you plan to work toward the 30-year subsidy, but one thing that’s important to know is we haven’t talked about how payments transfer between these plans. So your progress in the repayment assistance plan as far as qualifying payments toward, um, forgiveness as an income-driven repayment plan does not transfer to the other plans. Okay? But your time prior would go into the RAP plans timeline. So it’s really important from the start that you’re choosing the right plan or choosing it for the right reasons. So this could just be bridging a gap so we don’t have balance growth. Um, and then maybe we’re gona go into the IBR later, but that doesn’t always make sense. You can, you know, opt out of the deferment and do the IBR if you’re looking for a 20-year timeline. That’s also a great option because you are earning less money right now, which is great. Um, but the idea of the RAP is to halt the interest primarily. And so most times I see that those folks are the ones that wanna come out of school and attack their loans, but they just don’t want the balance to be growing in the meantime.

Emily (31:16): Okay. This is a new idea for me, so I’m loving this. Um, and I hope that listeners have gotten this far in the episode to hear this, this idea. So perhaps for some people, even if they have the plan that they are going to repay their student loans in full, while they’re in graduate school, while they’re eligible for deferment, they elect not to defer, they elect to be under the RAP. Um, but that is under the assumption that they, again, no longer want access to these legacy IDR plans, right? ‘Cause they wouldn’t be able to switch from RAP to –

Janna (31:46): You can switch. It’s just that your time, your time doesn’t count. Right? Um, and I think that’s the biggest part is typically you’re not going into it because you’re counting on time, right? You’re going into it for the interest subsidy. But if you spend time in the income-based repayment plan, as an example, and you go into the RAP plan, that time in IBR does count toward the RAPs timeline. So it’s a very, it’s a one-way street here.

Emily (32:11): I see. So a lot of people come to me with questions like, and this is very, like, old regime. Um, should I, you know, s – my loans are accumulating interest while I’m in graduate school, while they’re in deferment? Should I just pay, just make the interest payments along the way so my balance at the end of graduate school is the same as the balance at the start of graduate school? So you don’t have this, like, capitalization event that happens, um, when you come out of deferment. I get that question all the time because I think that was something the servicers offered, right? Like, “Hey, make your interest payments and, you know, freeze the balance.” So the idea is a little bit analogous here to what’s going on with this RAP suggestion of you’ll get a little bit of principal pay down, you’ll get the interest freeze, your payment might be low enough that you’re okay with making it. Um, that’s sort of similar ideas, is that right?

Janna (32:54): Yes. Yes, you’re right. Yeah. And I think the interest pay down, you know, when you’re doing it yourself and you’re in school, it almost feels like you’re climbing up, uphill mountain, right? You’re just, like, it is growing, but are you able to pay the, uh, the amount of interest that is accruing each month? Most times the answer is no, so that’s where this RAP plan is helpful. So it’s not just your money covering the interest, but it’s the government’s.

Public Service Loan Forgiveness (PSLF)

Emily (33:19): And I know that some listeners are going to have questions around PSLF, because a lot of people in the listenership will have jobs that will be eligible for PSLF. They’ll stay in academia or they’ll go to another research institute that’s a nonprofit, like these kinds of things. Um, so how does PSLF work with or not work with all the options we just talked about?

Janna (33:40): Great question. Complicated, of course. Um, so the criteria for PSLF, you have to be in an income-driven repayment plan and you have to meet the employment criteria. So it could be any of the income-driven repayment plans. Um, typically we would see the IBR offers the new version offers a lower payment than RAP. Not always, but most times. Um, and then the old IBR is typically the more expensive. So I think the whole philosophy for PSLF is you’re gonna choose the plan that gives you the lowest monthly payment, right? But maybe that’s RAP for now, but then I make so much money that I could really benefit from that IBR payment cap, right? So you might switch partway through. So when we talk about it not counting toward other plans, it does count toward PSLF. It doesn’t matter the plan, you’re counting your time toward PSLF. So that’ helpful to know.

Janna (34:34): Um, one thing I do wanna be specific on, on the RAP plan though, there’s a new term called on – time payments. Only on – time payments are counting as qualifying payments, both toward forgiveness for the plan itself and toward PSLF. And this just means you need to make your payments in full on or before the due date in order for it to count. So I often recommend setting up auto-pay a couple days before the due date because we really don’t know what if your due date’s on a Sunday, what if it’s on a holiday? We don’t know how they’re going to treat that. Uh, but it is pretty rigid on what is going to be a qualifying payment.

Emily (35:07): Okay. Very good. I’m so glad that you provided that clarification about PSLF and changing plans. Um, I just wanted to add, for this hypothetical graduate student who elects to not defer and go into the RAP for the interest subsidy, um, that time, even though maybe they’re an employee of a university during that time, it’s not going to count towards PSLF because they’re not full-time employees. So don’t go into the, I’m going to not defer and enter the RAP thinking that that time is gonna count towards PSLF. It’s not because you’re not a full-time employee.

Janna (35:40): Right. You have to be 30 or more hours per week on a W-2, which is also important because I find sometimes you’re paid by W-2, sometimes you’re paid by a 1099 and the 1099 just does not count. And when we get into the weeds on that situation, quite frankly, I would say stay in deferment because the balance is gonna be forgiven at the end anyway, whether it’s interest accrual or principle. And I’d rather you put that money in something that’s gonna work for you, whether you’re working on building an emergency savings fund, you’re opening up a Roth. Those are all great options. Keep your money. Have it work for you in that instance.

Emily (36:15): I’m glad you said that because I had a little brain lapse right there because yes, of course, if you’re just doing 10 years after graduate school and you’re going for forgiveness under PSLF, it doesn’t matter what the balance was. It’s all gonna be forgiven at the end. Now, maybe people wanna hedge their bets in different ways possibly because they don’t know for certain what their career trajectory is going to be. That’s another layer of consideration in all of this. Janna, this was so helpful, but it also proves why you have a job. Um, can you please let people know how they can get in touch with Student Loan Planner if they’re looking at all these options and they’re like, “I need a professional in my corner to help me sort out, do the math on this. ” How can they work with Student Loan Planner?

How to Work With Student Loan Planner

Janna (36:54): Absolutely. Just come to our website, studentloanplanner.com and you can up in the corner, it’ll say, “Get a plan.” And you can either look under our individual bios and book with us individually. Or if you just click Get a Plan, you’re gonna get a round robin any of us. And we’re honestly all really great. It’s a really great team to work for. We’re all in your corner. Um, and know that with the consult, you do have three months of email support after we meet. And I think that part is really important because as much as we try to give you all the information and the follow-up resources and tools, there will always be questions. Um, so we’re always here to support you through that.

Emily (37:31): Emily here, breaking in with the updated link that you heard about at the top of the episode. If you want a consultation from Student Loan Planner, please go through my affiliate link of PFforPhDs.com/SLP/ to receive $100 off the standard fee. Now back to the interview.

Emily (37:52): Yeah, thank you so much. And I’ll put in a plug for the Student Loan Planner Podcast and also there’s a, what’s it called? A wealth version of it. There’s a couple different podcasts, right?

Janna (38:01): SLP Wealth. Yeah.

Emily (38:02): SLP Wealth. Yes. I listen to those podcasts regularly. That’s where I get my primary <laugh> student loan news from. So I, you know, you’re already listening to a podcast. Add those if you are a student loan borrower, um, on as well. If you’re not ready for a consult yet, just get some great information through the podcast. And at the right time, you’ll remember <laugh> who to reach out to. Um, so Janna, thank you so much for, um, coming on this interview.

Best Financial Advice for Another Early-Career PhD

Emily (38:22): I wanna end with the question I ask all of my guests, which is, what is your best financial advice for an early career PhD? And it could be something related to student loans or not.

Janna (38:32): I’m gonna go out of student loans and I actually have two today. So I think of my PhD students that I work with and I get to see them from beginning to end. And we always talk about investing early. And so they open an account, whether it’s the Roth or the employer sponsored. And at their end, five or six years in, they’re like, “Thank you so much.” And I think what this tell – like starting early is like, you’re gonna thank yourself later for making that decision, even if it was the tiniest amount. So think about that. Um, and then my next one is automate as much as possible. You all are so busy that know that you can set up multiple direct deposit accounts with your paycheck so you can have some money going to your checking, some to your savings. Like those are tools that will save you so much time and a headache for sure.

Emily (39:17): I love that advice. Janna, thank you very, very much for joining me today.

Janna (39:21): Thank you so much for having me. I’m happy to be here.

Outro

Emily (39:33): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by me and show notes creation by Dr. Jill Hoffman.

This Grad Student’s Social Spending in Boston Pays Dividends

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In this episode, Emily interviews Richard Coca, a 3rd-year PhD student at Boston University. Richard breaks down his budget, detailing his top five largest expenses: rent, groceries, eating out, hobbies, and social spending. He rents a bedroom and private bathroom in a shared home convenient to public transit in East Cambridge, and the higher rent is offset because he does not own a car. Richard has developed two intensive hobbies since starting grad school: running and stand-up comedy. To participate in those hobbies, he spends on race entry fees, shoes, and drinks and meals at venues. Richard used to overwork and be much more frugal; he now spends more on his hobbies, eating out, and friends, but he’s still reaching his goal of maxing out his Roth IRA every year. He feels mentally and physically healthy and is happy with his work-life balance.

Links mentioned in the Episode

This Grad Student's Social Spending in Boston Pays Dividends

Teaser

Richard (00:00): When you are doing physically well, usually you are also doing mentally well and uh, financially well. And I feel like those three things kind of all are intertwined and if you’re working on one of them, they kind of help support the other two. Um, so I think, yeah, I might not be saving as much as I could be, but I think spending that money pays dividends and sort of my mental wellbeing as well as sort of just being uh, a lot more physically active, being a lot more in community with like the huge running community here in Boston, the standup scene here.

Introduction

Emily (00:43): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (01:13): This is Season 24, Episode 3, and today my guest is Richard Coca, a 3rd-year PhD student at Boston University. Richard breaks down his budget, detailing his top five largest expenses: rent, groceries, eating out, hobbies, and social spending. He rents a bedroom and private bathroom in a shared home convenient to public transit in East Cambridge, and the higher rent is offset because he does not own a car. Richard has developed two intensive hobbies since starting grad school: running and stand-up comedy. To participate in those hobbies, he spends on race entry fees, shoes, and drinks and meals at venues. Richard used to overwork and be much more frugal; he now spends more on his hobbies, eating out, and friends, but he’s still reaching his goal of maxing out his Roth IRA every year. He feels mentally and physically healthy and is happy with his work-life balance.

Emily (02:12): At the start of every academic year, fellowship recipients need to know that if they are not having income tax withheld from their paychecks, they should start self-withholding and possibly make a payment by September 15th. Otherwise, they are in for a nasty surprise when they file their tax returns next spring. If your university has not in the past provided adequate messaging and resources regarding estimated tax, would you please recommend me as a workshop facilitator for the start of the upcoming academic year? I offer both live and asynchronous versions of a workshop that guides US citizens and residents in filling out the Estimated Tax Worksheet in IRS Form 1040-ES and managing their money to seamlessly meet their tax obligations. These workshops are typically considered professional development or personal wellness. I would appreciate you cc’ing me when you recommend me so I can follow up with additional information for the potential host. Thank you very much! You can find the show notes for this episode at PFforPhDs.com/s24e3/. Without further ado, here’s my interview with Richard Coca.

Will You Please Introduce Yourself Further?

Emily (03:41): I am delighted to have joining me on the podcast today, Richard Coca. He is a third year PhD student in neuroscience at Boston University and today we are doing a budget breakdown. So we’re gonna get to know all of Richard’s top expenses and all of the nitty gritty details about his finances. So Richard, thank you so much for volunteering to come on the podcast. Will you please introduce yourself a little bit further for the audience?

Richard (04:03): Yeah, of course. Super excited to be here as a long time listener. Um, as you said, my name’s Richard Coca. I would describe sort of who I am. I’ve always kind of been in the science space and a scientist, but recently my PhD journey has been like, okay, science is obviously very difficult and very hard. There are other things to life. So I’ve been trying to sort of expand more and increase sort of my hobbies and in that sense that’s sort of had a stress on my budget and we’ll sort of break that down further. But I pivot back to you Emily.

Current Funding, a Cross Country Move, and Household Size

Emily (04:36): That’s great. Um, finding some identity outside of the lab. Very highly recommended <laugh> along this PhD journey. Um, wonderful. Okay, so we know you’re at BU. Um, can you tell us a little bit more about like how you’re funded? Do you have an assistantship or a fellowship or just give us some more details about that.

Richard (04:56): Yeah, so my program actually um, will fund you for five year guaranteed. Um, our stipend right now, um, now actually all the stipends at BU now that the union has negotiated a rate are all the same. So it’s around like $48,000 a year. Um, I actually was on our training grant for the first two years of my PhD. Um, so that was nice and they were nice enough to give what I thought at the time was a baller $3,000 relocation, stipend, um, and it was baller but then you kind of realized that living in Cambridge is expensive. I’m now on my PI’s uh, grant. So that’s my current funding source.

Emily (05:35): Well I know from my work around the country that um, Boston is an unusually difficult market to move to, right? Because you have um, the realtor fees if I remember correctly as well as, you know, first month’s rent, maybe last month’s. So that $3,000 probably really helped with that process I would imagine. Do you wanna give us any more details about how it was to actually move to Boston?

Richard (05:56): Yeah, I mean at the time I was actually living with uh, my former partner so it was less hard. So in that we had subsidized housing, which was so lovely. Um, but I think really a lot of the funding or a lot of the relocation went from like shipping all of our items to Cambridge, which I think in retrospect really didn’t need to bring that much from California. But um, I think it’s something you don’t know until you kind of live through it and make that move across the country.

Emily (06:27): And tell us about who is in your household now.

Richard (06:30): Uh, now I live with roommates, um, and that is um, it’s a bigger home in Cambridge, so I’ve always kind of lived in the Cambridge rental market. Um, yeah and uh, I’m very bougie in the sense that I always want my own little bathroom. So I do have kind of essentially a studio but like you know, you’re sharing a common space. Yeah,

Emily (06:55): Let’s find more out about your housing when we get to that in your list of expenses. Um, so you’ve covered your stipend, which sounds great actually. I mean I know Boston has a high cost of living area, but like that’s not bad at all. And like do you wanna give us any more details about were you there when the union was negotiating or like what was the timeline of that relative to you starting grad school?

Richard (07:16): Yeah, so I think the strike actually started probably like within the year of us moving here. Uh, so my first year was really clouded by a lot of strike negotiations and sort of classes not being offered. Um, my, I would say I’m glad that effort went through I think my PhD program even before sort of those efforts already was among one of the more higher paid programs at BU. Um, but there are also pro programs out here that were paid maybe like 20K a year. Um, so really glad sort of that effort went through for them.

Maxing out a Roth IRA and Using High Yield Savings Accounts as a Grad Student

Emily (07:50): Yeah, amazing. Are you currently working toward any financial goals?

Richard (07:55): Yeah, I think my goal every year, um, and I’ve learned, I just saw an article about this actually. It’s like Gen Z is doing a Roth IRA max every year. They’re the generation that’s done it the most and that’s always been something that I’ve done every year. Um, I think this year in particular I have tried to shift a lot more of my funds in high yield savings. I am kind of trying to think less about money and kind of just have it passively grow itself. Um, but really I think my goal is just every year maxing out Roth IRA and I think kind of at the point where I’m almost, I think I could spend a little more than I should, but you know, that’s something that I’m constantly negotiating with myself

Emily (08:36): In 2026 maxing out a Roth IRA is like seven and half thousand dollars I believe. And so I’m just doing some quick math in my mind. But that’s something like 13, 14% of your gross income, is that right?

Richard (08:48): Yeah, I think so.

Emily (08:49): So that’s a pretty ambitious like goal, so that’s amazing that you’ve been able to do that consistently.

Richard (08:55): Yeah, and I think part of it was like I was uh, set up nicely in college. Um, I was lucky enough where, um, due to sort of my parental income, I kind of never had to pay tuition. Um, and I was also an RA and I think that’s kind of the cheat code for undergrad or grad school. Um, you just get like seven K or that was my stipend, um, in undergrad and each year I would just throw that in the Roth IRA. Um, so I kind of have had at least five years of maxing it out or four years of maxing it out, um, which is nice to like look at as a good chunk of change. Yeah,

Emily (09:33): Yeah. Even when you are still, like you said, four or five years in, it really does start adding up like pretty early on. That’s amazing. And then when you mentioned like the high yield savings accounts and just putting money in there, um, do you have any, um, purpose linked to those accounts? Is it just to have some safety money or fallback money or like how do you think about that money?

Richard (09:52): Yeah, I, I just think like at least growing up I wasn’t really raised like my parents in particular up until like two years ago, like they are the type of people who, it like kills me, but like all their money is like in a checking account or like a savings account with very low interest. Um, so like learning about high yield savings account or like even different accounts, um, where you can, you know, the interest rates are a lot more generous I think of my high yield savings account as, oh, this is the interest that will be used for like casual spending money. Um, or at least that’s how I treat it. Um, I think in a way probably not the best financial perspective to look at it, but I, that is how I kind of currently use it. Um, yeah.

Emily (10:34): What types of things would you spend that on?

Richard (10:37): Yeah, I feel like, um, oftentimes, uh, and I, this goes sort of into some of my bigger expenses. Um, so thinking about sort of like social outings is particularly with my cohort or with friends out in the uh, Boston area, like those are very expensive. Especially here it’s like a, if you wanna have a good day in Boston, it’s a minimum of a hundred dollars. Um, so that’s the type of uh, time where the high yield saving kind of does generate. I don’t think it’s a hundred dollars if I’m being honest. Sometimes I do dip into it, but like, um, it covers part of it I would say.

Emily (11:10): And all of this is like you were saying earlier, in an effort to just feeling less stressed and less like tight about money. Is that right? Like you think you can, you should be loosening up a little bit more it sounds like.

Richard (11:21): Yeah, I will say like I kind of, in order to max out the Roth IRA earlier in college, I kind of feel like I um, was definitely a lot tighter and a lot more meticulous about how I was spending. Um, and in a way I kind of gave myself um, this feeling of missing out. ’cause a lot of my friends post-college kind of went into the whole traveling the world bit. Um, and I’ve done some of that, but I do feel like, I don’t know, uh, money is one of those things where like if you spend it, it somewhat comes back to you. I, I don’t know if that’s always necessarily true, but um, I definitely feel like I am not going to, uh, go and destroy my wallet if I accidentally dip a bit too much.

Emily (12:06): Hmm. I I’m getting like a, uh, a Die With Zero vibe from you. Have you read that book or have you heard about that book? Okay. It might, if you read it, it might reinforce some of this, um, mindset. It really helped me because from when I went through graduate school I like learned to be really frugal and really tight and really careful and all of those things. And definitely airing more towards maybe too much saving and not as much lifestyle spending as I should have been doing. And so that book, when I read it a few years ago, really helped me kind of rethink about just kind of what you were saying there is how money can buy you what the author calls memory dividends. Like it literally is an investment that you make in your enjoyment of your life going forward in the decades to always have those memories to look back on.

Emily (12:52): Um, so it just, it’s a book that does very well for people who aren’t have the tendency to over save. It’s definitely not a good book for somebody who’s already in like the overspending, not saving enough, investing enough for the future kind of, um, side of things. So anyway, I’m just, I think you might find, um, some commonalities if you did read that book, but I’m very curious now that we’ve had that point in the conversation to know about what your expenses are, um, to kind of see how you’re balancing things within this stipend. So we’re gonna run through your top five expenses in either last month’s budget or a typical monthly budget. So lead us off, what is your number one expense? It’s the same for everybody. <laugh>.

Budget Breakdown: Housing and Transportation

Richard (13:33): Yep. It’s always, it’s always rent. Um, and I live in east Cambridge, which is relatively nice area, maybe like a half hour to 40 minute commute to work. Um, and that is probably like the big budget, like where most of my income goes and that’s like $1600 a month. Um, just went up this year but it, it always does. Um, but that is sort of, you know, kitchen, uh, bedroom own bathroom, which I really love and it’s a big bathroom. Um, and I think for the area it’s like actually probably on the lower end I would say.

Emily (14:08): So 1600 a month. You said you have your own bedroom, your own bathroom. How many in like the overall unit or home size, how many people are living there?

Richard (14:17): So it’s two other roommates. Um, they share a bathroom. I think the rent is cheaper and kinda at the point where like I love having my own bathroom. 

Emily (14:27): How did you find this place and how long have you lived there?

Richard (14:30): Uh, this was now year two. Um, and I kind of just found it via probably Craigslist actually. Um, and it was one of those moments where um, you know, the really lucky in terms of who my roommates are and I think in terms of almost their frugality, like they’re not the type who will run the heater 24/7 or necessarily like drive up utilities or anything else. Um, and it’s, yeah, shout out to them, um, because you know, those things do kind of add up. I think utilities wise, I probably spend less on utilities a month than I do groceries for sure. Um, or even like smaller things. Yeah,

Emily (15:13): That’s great. It’s really wonderful to find people who you have the same kind of attitude with about things like that. Um, tell me about the choice to live in Cambridge and have that length of a commute. Like tell us about your commute. Do you use public transit? Do you drive?

Richard (15:27): Yeah, so that’s a great question. Um, I used to live actually my first year when I was living with my, uh, former partner. We would live literally right above Harvard Square, like the red line station was underneath our house. Um, and back then I would just, it was weird because BU is like, it’s on the green line so you would have to go from the red line to the green line and it was easier to walk 45 minutes than it was to take the T. Uh, which is really like a failure of sort of that transportation system. So when I was moving I was like I need an easier commute public transportation wise. Um, and I want to be somewhat closer to the city ’cause that’s just where things really are. Um, so I knew I was gonna move towards East Cambridge and now my commute is maybe like 20 minute green line and then like a 20 minute walk to lab, which is awesome. Um, same time a lot more, I don’t know, fun, less stressful, I think, of a commute. Um, and I really have always loved living on the other side of Boston. There’s something about being separated by the Charles River where I kind of just like, once I cross it, I am detached from work and lab and, and kind of just relax.

Emily (16:38): That makes sense. And I’ve heard that so many times from people who have commutes of any sort, like it, it provides a reset point in your day and helps you, yeah, maintain that kind of psychological separation from your home life versus like your work life. And obviously that got destroyed <laugh> from you work from home like I do, uh, doesn’t exist. We don’t have that benefit. But anyway a lot of people hate commuting, but there is that one, you know, kind of upside for it. Um, that yeah, it gives you a reset point and a way to relax for part of the day. And I love using public transit, a combination of public transit and walking like that sounds ideal to me.

Richard (17:11): Yeah, and it is ideal. And I’ve also started, um, one of the hobbies I guess going on the next expense that I, um, has slowly crept up on me. It is like running. So I’ve started like run, commuting occasionally to work. Um, and then you also save on transportation, I guess expenses, which aren’t that high in Boston if I’m being quite honest.

Emily (17:31): Yeah. Actually let’s talk for a second about transportation expenses because you gave me a preview of your expenses and they don’t appear in the top five. So just tell me like, do you not own a car? Do you pay for a pass for public transit? Like how do your costs play out? And I know they’re not in the top five, but I’m curious about what they are.

Richard (17:49): Like my station in particular, um, it’s really just like $2.40 to take the T. Uh, and I would say like it, it’s frequent enough where um, if you’re, if you’re lucky and you need to catch a bus like, and you take the T immediately after it’s only 70 cents additional, um, so I would say like $2 a day or like 4 or 3, $4 a day actually. It really doesn’t add that much. And I’m also, because I do ride on the weekends, like I kind of save on that money. Um, so it’s not like a noticeable debt in the budget.

Emily (18:22): And your public transportation expenses are pretty much the sum of your transportation expenses. You don’t have any other regular transportation expenses?

Richard (18:29): Yeah, I don’t, yeah, I don’t use a car. I have a roommate who has a car, which again, this isn’t really coming clutch, uh, for those big Costco runs. Um, and I think yeah, other friends have cars and it’s so often where like if I am traveling to somewhere in state that’s farther out or say making a trip to New York, it really doesn’t like, it doesn’t make a big dent. Um, which like I’m coming from LA where you need a car everywhere to go and gas so expensive. I’m kind of like, that was one of the big selling points for moving across the country for me.

Emily (19:05): Yeah. And it definitely helps to offset the higher rent price if you have very, very low transportation costs and you don’t have to own your own car. Amazing. I love to hear that.

Commercial

Emily (19:16): Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, budgeting, or designing your financial life, each tailored specifically for graduate students and postdocs? I offer live workshops, asynchronous online courses, and cohort-based programs on these topics, and I’m now booking for the 2026-2027 academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, medical school, postdoc office, or postdoc association? My workshops are usually slated as professional development or personal wellness. The fall semester is an excellent time for any type of personal finance content. Ask the potential host to go to PFforPhDs.com/financial-education/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

Budget Breakdown: Groceries and Dining Out

Emily (20:50): Okay. Your number two expense, what is that?

Richard (20:53): Uh, my number two expense is definitely probably gonna end up being my groceries. Um, as I said, I’ve started running a lot more and with that comes the dreaded food noise, so I’m like constantly, uh, getting more food. Uh, the other thing is like, because I um, was formally lived my partner, now I’m paying like the singles tax in terms of food prep and making more food. So I am not someone who like, actually I make probably make enough where I should have leftovers for lunch and should be saving there, but I’m not necessarily having leftovers after I eat dinner after a run. Um, which is like, I mean it is what it is, but I definitely spend more than I think one would typically expect for groceries. Uh, so it’s like maybe a hundred to 150, um, per week I would say. And I’m someone who loves fresh produce as well. Um, and I very frequently learn that if you buy big batches of like fruits and stuff, they will rot in my fridge. So I’m someone who has to get it like day of. Um, and there used to be a grocery like really close to my lab so I would just kind kind of swing by and eat a fresh plum or anything like that. Um, but yeah, it was like those small things like that were like a nectar, a $4 nectarine kind of like quickly added up, um, over the week.

Emily (22:17): So tell us about your like grocery shopping habits then. Like how many times per week are you grocery shopping? You mentioned Costco a moment ago. How often are you going there?

Richard (22:27): Yeah, I would say a Costco run is maybe like bimonthly like every other month. But, uh, the bigger expenses I would say would be um, like dinner and I think in, in terms of like, uh, shopping habits like that can range anything, anything between like once or twice a week to sort of the European model where I’m kind of going in there for, you know, just the ingredients for dinner for that night or for like fresh produce and stuff like that. Um, so one way I try to actually cut costs ’cause I started realizing it was getting like a bit excessive in particular for lunch. Um, is just like getting, relying more sort of on like food kit or like salad kits and stuff like that. Um, so I started doing more of the, you know, sometimes lunch has to be boring and I kind of had to convince myself of that. So more salads and sandwiches and stuff like that.

Emily (23:19): Yeah, I was just gonna ask about like what types of foods you’re eating and what types of foods you’re cooking for yourself. So you mentioned lunch, salads and sandwiches, like what kinds of things do you eat for dinner? Do you have patterns that you’re in?

Richard (23:30): Yeah, I feel like it’s mostly a lot of chicken. Um, I don’t typically eat pork, but I guess like the bigger expense would be like beef, um, and stuff like that.

Emily (23:41): And do you cook dinner like every night? You said that it’s hard to maintain leftovers, so are you cooking like pretty much every day?

Richard (23:50): Um, not as much as I should be and I think maybe it’s like the current recent spell that I’m in. Um, but I would say I like cook maybe every other day. Recently I’ve kind of, the other hobby that I’ve joined that’s been somewhat expensive is like I do standup now. Um, and sometimes making the open mic means that I’m not going to be able to make dinner or like trying to balance that between the PhD. Also getting my mileage in for my run for the week. Um, it means that I have to like stop by somewhere, uh, in between the commute and that’s sort of where my third expense is. Just like the, the food that I’m not cooking for myself. That adds up so quickly, that’s like $20 each time. Um, and I feel like that is definitely a bigger expense than say transportation per se.

Emily (24:39): So that third expense of like eating out of your own home Yeah. What does that add up to over the month?

Richard (24:48): Ooh, that’s like a good $300 I would say it’s a good chunk of change. It’s the one where I’m like, huh, maybe we should tie it up.

Emily (24:56): It just depends. That’s why we talk about goals first. Like if you’re meeting that Roth IRA goal, hey <laugh>, what else do you need to do? Right.

Richard (25:04): Yeah. Yeah.

Emily (25:06): Okay. So it sounds like you’re eating out, um, you know, when you’re transitioning from place to place. Um, you mentioned, you know, you used to grab things from the grocery, uh, near your work. Um, in what other situations do you find yourself eating out and I guess how do you feel about it? Like are you happy about spending that money or are you like, oh no, I need to find a different way to manage this?

Richard (25:26): Honestly, I’m someone who like, especially when I eat out with friends, like I would definitely not regret that. I feel like that is experi- experiential and going back to sort of the idea of memory dividends, having to pay for that, where I’m less excited to do so is when I’d say have gone for a run or I’ve had like a really long day in lab and I’m like, uh, screw it. Like I don’t wanna make dinner for myself. That’s sort of the time where I, I kind of look back in time. I’m like, no, just, just like quickly make some fajitas. It won’t be that long. Um, but yeah, I think I, the guilt I feel is probably going back to that idea of like, oh, you could be saving some money there. Um, but you’re not, but it is what it is.

Budget Breakdown: Hobbies

Emily (26:08): Okay. What is your fourth highest expense?

Richard (26:12): My fourth highest expense has to be like my hobbies. So like running or like stand up. Um, each definitely have a cost associated with them running in particular, I’ve been signing up for a lot more races and it’s kind of like the one that’s like biting me. Um, I recently did like the twin lobster half marathon with like a week’s notice and that was like a good a hundred dollars, uh, race fee. Um, that’s a huge chunk of change. And the other thing is like shoes, uh, the amount of mileage that I put into my shoes, I’ve needed to like replace ’em and that’s like maybe $150 to $200, uh, per pair. So that’s definitely been eating at me and I think I now have um, like seven or so pairs of shoes. Um, so it’s like a huge, huge part of sort of the disposable income I would say.

Emily (27:06): I am not a runner and I’ve never like paid to enter a race or anything. Can you tell me what like benefits you get from it? Is it being around other people? Do you do it with friends? Is it challenging yourself and your times? Like what’s the reasoning?

Richard (27:19): Yeah, I guess like they close the street so it’s like easier to set like a personal best. Um, but oftentimes races have amenities so they’ll have uh, actual like, um, let’s say water on the course or electrolytes on the course as well as like fueling bananas and sometimes they’ll have a metal or a t-shirt associated with them. And oftentimes it’s just like a sort of a chance to kind of prove to yourself like what you can do, um, which is a bit nice, but I really like the atmosphere of race day. Um, you can just sort of feel in the air like before the actual uh, sort of gun goes off that everyone’s kind of a little anxious and everyone wants to really do their best and there’s something about seeing people try really hard and sort of try to reach their goals. Um, it’s just like worth sort of pain to be around and just being in that community there.

Emily (28:11): How many races would you say you’re doing per year?

Richard (28:13): I would want to say maybe like two to three per season. Um, so that’s actually adding up to lots maybe like, um, eight to 10, I don’t know if I did my math right. Yeah. Some somewhere around that. Um, marathons are a lot more expensive because you have to kind of fly out there as well, uh, get accommodations, but I limit those to two per year. Um, I’m running Philly in the fall saving, saving on accommodations by staying with a friend actually. Um, and the other sort of local race that I do here are like the Cambridge seasonal 5Ks and that I try to, those are only like $40 a race I would say. Um, so it’s not too much. And then I try to do a couple of halfs as well.

Emily (29:01): Have you found, um, any other, um, PhD students or other like academics who have a similar commitment to running or their own like kind of athletic hobbies? Like is this something you bond with other people about?

Richard (29:13): Oh, oh, absolutely. Uh, same with standup comedy. You would be surprised how many academics are actually in those spaces. Um, and I think it’s like something that I really enjoy seeing. Like there’s been times where I’ve been say like at a comedy club and actually talking like pure science to the point where like, wow, the work that you do in your lab is extremely relevant to like what I’m doing in my dissertation. And that’s like something where I’m like, I wouldn’t say like only in Cambridge, but like it’s honestly like an awesome thing. I think about sort of the Boston ecosphere. Same with like running, there’s been times where I’ve met like the editors of journals of um, sort of like the science family or cell, um, and they’re just be giving like advice to like other grad students. I would say like in particular, something about the mid twenties brings out a lot of runners. Um, so there’s a lot of PhD students, um, that I’ve met who are like training for different things and people often say, you know, the PhD is like a marathon and sort of not a sprint. And I think that’s something that a lot of people actually take to heart. And I would say maybe running a marathon is easier than doing a PhD. Um, but that’s just my opinion.

Emily (30:24): That’s amazing that it also turns into a networking opportunity and and so forth. Um, yeah, I mean you mentioned maybe not only in Boston, but Boston would be a great place. There’s obviously, there’s just so many universities there, such a young population overall, like yeah, I would imagine if you’re just getting out there and doing things, you naturally run into a lot of other people who are in a similar position to you. Tell us more about the standup comedy. I mean, I totally understand, uh, you’re going from, you know, work over to where you’re, I don’t know what the word is, delivering a what do you do? A, an open mic. I, i don’t know what the words are, but you know, you have to grab dinner along the way. Um, what other costs are associated with that hobby?

Richard (31:05): Yeah, so doing an open mic or doing a showcase, a lot of the time these spaces are actually kind of very hard to come by. Um, Boston has a small comedy scene, I think relative to sort of the big three of LA, New York, and Chicago. Um, and recently a couple mics have been closing and one of the big things around that is like, you gotta support the venue. You really gotta support the menu. These guys need to sort of sell drinks, sell food in order for them to know this is profitable to put on these events. So there’s a cost of buying sort of drink or buying food to support the venue. Um, that goes into doing like open mic. The other expense is like if you do showcases or you get booked on for another show, there’s often the traveling that you have to do. Um, oftentimes that’s like another part of Massachusetts. So like, you know, paying for someone or like, you know, I would want to pay for someone’s gas if they’re driving me to like say Foxborough per se. Um, the other cost sort of associated with standup as well, if I’ve been lucky enough to sort of kind of co-produce, um, a show before. And it’s just like fronting the money for, uh, the things that you need for the after production, um, be it like flowers or, um, sort of the ticket writer for the other performers in the show.

Emily (32:23): Well this is so exciting and so unique that, that aspect of, of your hobby of doing standup. Okay. We’re down to your fifth largest expense on a monthly basis. What’s that?

Budget Breakdown: Gifts

Richard (32:34): Um, I would say more the social aspect. I’m someone who really loves spending money on gifts. Um, so when it comes to like friends’ birthdays or stuff like that, one of my friends actually who got me more into running, um, she’s great. Shout out to Viv, I think she’s over at Woods Hole right now. Um, she, uh, for her birthday I really wanted to sort of spoil her ’cause I, she really again got me into running, so I decided to get her like a fresh pair of running shoes as well as kind of like a runner starter pack, so like some gels and electrolytes and other stuff for like stretching. Uh, um, and I guess that was like a more, um, expensive gift. And I, I do like sort of thinking more of like well thought gifts for other people as well, um, whether that’s like surprising them or their graduation and stuff like that. So that’s kind of like on the scale of a hundred dollars, $250 kind of monthly splurges and stuff like that.

Emily (33:37): Amazing, amazing. You’ve identified that about yourself by this point, like that generous spirit like in that way. Um, and great that you have the room in your budget to, um, indulge it to the degree that you want. Kind of one of the themes that I, I think is coming out with this episode and you know, something you’ve, you’ve found along your journey in graduate school is this is finding these pursuits outside of the lab and outside of work, um, that are enhancing your life and satisfactory to you and so forth. Would you say that that is necessary to maintain like your mental health, your physical health and still work like very well and effectively in the lab? Or like how do you think about, I don’t wanna use the word balance, but like how do you think about the, the time and energy you’re spending at work versus these other pursuits and how do they complement one another or how do they, I don’t know, maybe compete with one another?

Richard (34:34): Yeah, I would kind of say that they’re almost intertwined. Like I think about I guess the earlier part of my PhD, um, and even post rotation, uh, like in the first lab that I joined, um, I was spending like a lot of time, a lot of effort on the weekend and I think, um, definitely at the expense of sort of a more balanced life approach and yeah, I’m sure I was saving money, but I definitely was not as happy I would say. Um, so I think like when you are doing physically well usually you are also doing mentally well and uh, financially well. And I feel like those three things kind of all are intertwined and if you’re working on one of them, they kind of help support the other two. Um, so I think, yeah, I might not be saving as much as I could be, but I think spending that money pays dividends and sort of my mental wellbeing as well as sort of just being, uh, a lot more physically active, being a lot more in community with like the huge running community here in Boston, the standup scene here. Um, if they’re doing, you know, I’m happy. Thankfully I’ve met like so many wonderful people and I think that really carries into sort of how I conduct myself at work. My coworkers often be like, you’re always smiling and I’m like, thank you for noticing that. Um, but I think it really helps, I think for, um, I don’t know, just like staying at the top of my game and trying to be who I am.

Emily (36:03): It’s really lovely to hear. Thank you for kind of summing up, you know, your, your approach, um, in this respect and I’m, I’m glad to hear that, you know, over the years in graduate school you’ve found a level of spending and a level of, you know, uh, time commitment that as you said, it’s kind of like a mutually positive reinforcing cycle between like your finances and your mental health and your physical health and your performance at work and so forth. So I’m just really glad to hear that. Um, Richard, thank you so much for, uh, volunteering to share your budget with us and give this interview.

Best Financial Advice for Another Early-Career PhD

Emily (36:31): Um, I’d like to end with the question I ask of all, I ask of all my guests, which is, what is your best financial advice for another early career PhD? And it can be something we’ve touched on already in the interview or it could be something completely new.

Richard (36:44): I would say probably like in all actuality, just try to max out that Roth RA if you can. Um, but also don’t be afraid to spend. ’cause like as I tried to touch upon earlier, like that money that you do spend does come back, whether it be in the form of memories or accidental networking with other people, I think it’s like a great opportunity. Um, like money is not something that just like sits there and collects dust. I think it’s something that can work, um, in your favor, uh, whether it be just like passive saving or sort of gaining an opportunity that you wouldn’t elsewise try.

Emily (37:19): Amazing. So glad to hear from you during this interview. Thank you so much for volunteering.

Richard (37:23): Alright. Well thank you so much for having me.

Outro

Emily (37:35): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by me and show notes creation by Dr. Jill Hoffman.

This Grad Student Fellow’s Frugal Lifestyle Enables a High Savings Rate

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In this episode, Emily interviews Michele Remer, a 4th-year PhD candidate at Michigan State University and repeat podcast guest. Michele breaks down her budget, detailing her top five largest expenses: rent, groceries, utilities, restaurants and social events, and transportation. During grad school, she has found ways to decrease her spending on some necessary expenses, which has allowed her to intentionally increase her spending in other areas of higher value. Due to her frugality and her National Science Foundation graduate research fellowship award, Michele has maintained a very high savings rate, which she puts toward her Roth IRA, taxable brokerage account, and student loans.

Links mentioned in the Episode

This Grad Student Fellow's Frugal Lifestyle Enables a High Savings Rate

Teaser

Michele (00:00): I’m just like, okay, I send my money here to, uh, pay off the debt, or I send to my savings account to save up, to pay off debt, or I’m sending it to my investment accounts. And so it’s not super exciting once you’ve got it set up, but I think that’s a good thing because then you just kind of get to live your life while it’s all happening in the background. So as long as you kind of have your expenses figured out, which is really nice.

Introduction

Emily (00:34): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (01:03): This is Season 24, Episode 2, and today my guest is Michele Remer, a 4th-year PhD candidate at Michigan State University and repeat podcast guest. Michele breaks down her budget, detailing her top five largest expenses: rent, groceries, utilities, restaurants and social events, and transportation. During grad school, she has found ways to decrease her spending on some necessary expenses, which has allowed her to intentionally increase her spending in other areas of higher value. Due to her frugality and her National Science Foundation Graduate Research Fellowship award, Michele has maintained a very high savings rate, which she puts toward her Roth IRA, taxable brokerage account, and student loans.

Emily (01:49): You’re probably listening to this podcast because you’re interested in improving your own practice of personal finance, and you want to learn the best PhD-specific strategies. Well, you don’t have to listen through the entire episode archive to do so. Instead, go to PFforPhDs.com/advice/ and enter your name and email there. You’ll receive a document that contains short summaries of all the answers ever given on the podcast to my final question regarding my guests’ best financial advice. The document is updated with each new episode release. Plus, you’ll be subscribed to my mailing list to receive all the latest updates there. Again, that URL was PFforPhDs.com/advice/. You can find the show notes for this episode at PFforPhDs.com/s24e2/. Without further ado, here’s my interview with Michele Remer.

Will You Please Introduce Yourself Further?

Emily (02:59): I am delighted to have back on the podcast today, Michele Remer. We, she first gave an interview for us in season 13, episode 8, published in 2022. At that time, Michele had just started graduate school at Michigan State University. She’s now finishing up her fourth year. During today’s interview, we’re gonna do a budget breakdown episode. So we’re gonna get to hear about Michele top five expenses, some other things she has going on in her finances, and we’re also gonna talk about how those certain expenses and so forth have changed over the last few years. And so it’ll be really interesting if you wanna go back and listen to that earlier episode to get that time point, to get the time point right now to get the um, how Michele summarizes that things have changed over that period of time. So Michele, thank you so much for volunteering to come back on the podcast. It’s great to have you. And will you please introduce yourself a little bit further for the audience?

Michele (03:47): Yeah, I can. Hi everyone. Um, like Emily said, I am doing my PhD and so I’m doing it at Michigan State University and I’m now a PhD candidate after passing my comps last semester. So officially went from student to candidate. Um, my undergrad degree was in environmental biology and now in my PhD I am in the Fisheries and Wildlife Department. And then, um, before starting my PhD, I worked a few seasonal jobs, one of which was volunteering with AmeriCorps, which I talked about in the previous episode. So that kind of gave me some good experience for learning how to save money and, um, knowing that going into this field I wouldn’t necessarily be making a ton of money.

Current Fellowship Income, Additional Income, and Household Size

Emily (04:31): Well, again, it’s wonderful to have you back. Um, okay, so let’s talk about today. Uh, you’re at Michigan State. Tell us a little bit about yourself, your household, if there are any other people or beings involved with that. Um, and you have an assistantship, do you have a fellowship? What’s going on with your income?

Michele (04:49): Yeah, so I, like I said, I go to school at Michigan State University, so that’s located in East Lansing. I actually live in the Lansing area as that is a bit more affordable, not living like super close to campus, relatively. Um, and then I’m also on fellowship currently and have been throughout my time at Michigan State. And I currently have one roommate in a shared house that I’ve lived in since the beginning of grad school. But this has changed from when I first started since originally we had three grad students in this house, but we’ve gone down to having only two people now.

Emily (05:26): Yes, I remember, I mean, your interview has really stood out for me over these years as you having this like ace in the hole with how much your, how much your rent was at that time <laugh>. So we’re gonna talk about the rent amount when we get there. Actually we’ll talk about the roommate situation too when we get to talking about rent. But good to know you’re living with one other person in a house in Lansing. Um, can you tell us what is your stipend income, your, your fellowship income, and then do you supplement your income in any way?

Michele (05:50): Yeah, so I was very lucky. I was fortunate to receive the GRFP and I was also lucky in the sense that I received it after the stipend increase went up from $34,000 up to $37,000, which in Lansing is very nice income to have. Um, and then, so I’m currently at the last year of the GRFP and that’ll be transitioning back into a university fellowship. So my income will actually go down, um, starting in September, but I will be supplementing that with another job over the summer helping out, uh, one of my committee members with some field work. And so it’s not quite making up the difference, but it’s getting me a little bit closer, which is nice.

Emily (06:32): So you’re anticipating coming off the GRFP, you’ve taken these measures to try to supplement your income currently, but in the past several years, have there been any points when you’ve made additional income?

Michele (06:43): Yeah, so throughout my time in grad school I’ve had what I call several small little side hustles that I’ve had. So that’s included opening, um, bank accounts to get the bonuses. Chase had one, I think last year that you got additi- an additional $900 if you open the checking and the savings account with them. And to, you just have to, to avoid having a fee, you just have to make sure you have direct deposit set up with them. And then I also did that for our local credit union at MSU. They had a similar thing when I first started grad school, so I think I got like an extra $100 from that. And then another thing that I’ve done is I open credit cards when I know that I have a big expense coming up. So in order to get like those travel bonuses, so like for my health insurance for instance, when I, I have to pay that with a credit card and so then that way I’m not spending my own money on trying to get these travel rewards.

Michele (07:36): And so that’s been also really nice. I haven’t done it too many times, probably just, uh, like twice maybe. But it has been nice to get a little bit more like travel points in that sense and then to cover various research projects or other professional development opportunities like conferences. I’ve applied and gotten some smaller fellowships through the university and I’ve also like volunteered at a conference to get lower registration before in the past. So just a few different ways to kind of, even though like with conferences it’s kind of sometimes a gray area between like who’s gonna cover it, it, it’s helpful for making sure that you have that and it looks nice in your CV, so.

Emily (08:14): Yeah, I love that you mentioned those specific avenues. Um, because they’re available to everybody. Like I don’t wanna speak out of return about visa regulations and so forth. So always international students need to be careful about what kinds of, um, avenues they pursue for earning additional income. But go back to my previous episode with um, Frank Alvillar and Sheena Connell about whether or not credit card rewards and those kinds of things, banking bonuses would be okay or not typically. Um, so go check that out. But none of these are gonna violate like the terms of your fellowship. They’re not going to, you know, rub your advisor the wrong way to be, you know, pursuing a credit card or like volunteering at a a conference. Those are absolutely very, very accessible ways for people to supplement your income and not ones that take hardly any time. I would classify those as passive, um, pursuits for increasing your income. So I love those suggestions. I hope that people um, take them to heart if they are looking for a little like marginal ways to either decrease some expenses or increase their income a little bit. When you were last on the podcast, I know we talked about your Roth IRA, so I wanna hear an update on what your current financial goals are, um, and how they’ve changed over the past few years.

Current Financial Goals, a 20% Savings Rate, and Debt Repayment

Michele (09:25): Yeah, so for the investing side of it, the Roth IRA, I’ve continued to focus on maxing it out. Um, even with the increases in the, I guess the floor for the Roth IRA, I think now you can do up to $625 a month, um, which is really nice that I’ve, with the GRFP been able to afford investing that. Um, and so that’s something that I try to prioritize when I can. If there’s like certain months where I’m not able to, then obviously I wouldn’t invest it. But that’s something that I’ve continued to prioritize.

Emily (09:59): Yeah, I think we’re up to $7,500 on an annual basis in 2026. I think that’s correct. And so with your income of $37,000 you’re looking at, that’s just about a 20% investing rate off of your gross income rate. So that’s pretty high for a graduate student. I know you’re about to say you’re working towards other goals as well. So just wanna put that touch point in there of like, okay, already like you have a relatively like very high savings rate for your current position. That’s awesome. Okay. You’ve got the Roth IRA, you’ve maxed it out even with the increases along the way. What else?

Michele (10:32): Yeah, so then with, if I do have like extra money at the end of the month, besides on top of the Roth IRA, I’ve been doing the a taxable brokerage, um, which that’s just obviously not as tax advantaged as a Roth IRA, but it still is helpful, especially for me. I’m not planning on buying a house anytime soon. The market is <laugh> not the best and I don’t know exactly where I’ll be. So I don’t really have a plan of purchasing a house in the next like five years or so and so, and I’m probably gonna continue renting. And so for me, I think it makes more sense for me to put additional money into, uh, investing rather than leaving it in a savings account. And then, um, the other thing that I did wanna mention that I just recently got a Fidelity credit card. This one don’t worry, no annual fee involved, but you, it gives you extra rewards if you, uh, invest in their Fidelity account, which can be your Roth IRA or a taxable brokerage. Um, and it’s also really nice if you charge any of your reimbursements for conferences or like I said was saying health insurance on there, you can get a pretty sizable percentage back or I think it’s like 2%, but when you’re paying that much, it’s a pretty big chunk of money, um, which is nice. So.

Emily (11:49): I love that idea as like, ’cause you mentioned opening credit cards for like, like signup bonuses. Um, I love the idea of having a baseline amazing cash back in a sense card like this Fidelity card is.

Michele (12:01): Yeah, I’ll say amazing is kind of a relative term, but <laugh>, it’s,

Emily (12:05): Yeah, but, but 2% for cashback card

Michele (12:07): Even $100 extra is so nice. So.

Emily (12:08): Yes. It is awesome. And then when you’re not working on a signup bonus, falling back and like always using that 2% cards great plan.

Michele (12:15): Yeah. Uh, which is really nice because I’ve found after doing a few of the annual fee cards, it’s, it gets to be kind of annoying to deal with and like having to remember to cancel it eventually if like you don’t, aren’t getting the enough rewards to kind of cover the cost.

Emily (12:31): Okay. So we talked about your Fidelity relationship and that’s great. Um, what else have you been working towards?

Michele (12:37): Yeah, so besides the investing, I’ve been working towards debt repayment. So I had a sizable chunk of student loan debt from my undergrad university since I went to, um, a private like liberal arts school. And so for that I, I borrowed from the federal government and then I also borrowed from a few family members who luckily had money saved up for me to go to school. And so as of right now, and I think in about three months I’ll have repaid my debt to my family members, which is awesome because I did not want to have to like owe them money anymore.

Emily (13:16): That’s incredible. And actually it’s particularly incredible that you’ve accomplished this during graduate school. So can I ask about, I don’t know, whatever you’d like to share, like either the starting balance or um, how much you’ve been paying on a monthly basis? Has it been regular or irregular? Like how has that relation-, that repayment relationship worked?

Michele (13:35): Yeah, so for this relationship, so it’s my parents, I, um, send them the money through, we have like a shared checking account kind of set up or I guess it’s like a shared bank account set up for this. So I send them like a set amount every month. And then also what I was doing at the beginning of grad school when I, I had extra money too because I just like didn’t want to owe them all this money. I think it probably started out at around like maybe 8 or $9,000. And so I was sending them like extra money as like I saved it up. And then I also, um, was just doing like a base of like a hundred dollars a month, um, just because I didn’t want to have to pay them back this money and I wanted them to have it back as soon as possible. And so that’s been really nice to basically by the end of grad school have, have that debt paid. And then for my other debt that’s through the federal government, I only took out the subsidized loans that I was offered. So that means like I didn’t pay any interest during grad school. And so for that I put it into like a kind of like a CD ladder when I had the, the rates were good, I would put it into a CD. And so then that way I’ve saved up like a large chunk of money to hopefully pay back, if not all of it, by the time the interest payments like come due, then I’m gonna be pretty close to paying off the debt. So I’m excited for that too. <laugh>.

Emily (15:05): Yeah. That’s incredible and I love that you’re introducing this idea of a CD ladder to the audience. It’s not something that, I don’t know that I’ve ever discussed on the podcast before. Um, but basically I love this approach because as you said, when we’re dealing with subsidized loans, not accruing any interest, you do not need to take any action and like your money is gonna be doing better for you literally in a savings account or a CD ladder or you know, money market account. I, I like that you’re not investing it. Right. I like that you’re not taking a lot of risk with it because you know, yes, this is gonna come due. Yes, I do wanna make these payments, um, pay it off quickly once you know it’s back in repayment. So I love that you’re not taking risk with it, but you’re doing as best as you can in terms of the interest rate, um, in the meantime. So wonderful approach. And another point of congratulations of wow, like look at all that you’ve accomplished financially during graduate school, like maxing out the IRA yearly, you know, getting ready or almost completely repay your student loan debt. Like that’s a lot to do as a graduate student.

Michele (16:07): Yeah, I’ve been really fortunate just the way everything lined up with the GRFP and um, also just, I mean we’ll get into my expenses, but I’ve also been able to keep my expenses relatively low as well, which is a good thing to be able to meet all these goals. And I will also say that I became a big fan of Mr. Money Mustache in <laugh>, uh, during grad school. And his approach really helped me be like, okay, how do I lower my expenses as much as possible, um, and kind of make sure my money is going to the right avenues. So.

Emily (16:43): Um, I’m not a big follow of follower of Mr. Money Mustache, obviously I have listened to him plenty of times and quite familiar with him, but, um, what I like about his approach is it’s really about finding satisfaction in a lower spending lifestyle. So it’s not about staying in your mind in a, um, a state of deprivation. It’s really about finding joy in simplicity and a low spending lifestyle. And I do think it’s quite compatible with the situation that graduate students are forced to be in, at least for a period of time. So I’m glad you found something that kind of like helped you with your overall, you know, disposition towards this financial stuff during graduate school. Um, is there anything you’d like to add about these, um, various goals that you’ve had or how they’ve shifted over the course of graduate school?

Michele (17:29): That’s the other thing is that it’s pretty boring when you’re doing like your finances in a, like a healthy way, I guess. Just like, okay, I send my money here to uh, pay off the debt or I send to my savings account to save up to pay off debt or I’m sending it to my investment accounts. And so it’s not super exciting once you’ve got it set up, but I think that’s a good thing because then you just kind of get to live your life while it’s all happening in the background. So as long as you kind of have your expenses figured out, which is really nice,

Emily (18:01): I think that’s very insightful. Healthy finances are boring. Like once you get it sorted out, you put everything on autopilot. Um, they’re boring, but that’s a good thing. Like you said, you can shift your attention away from those financial elements. You don’t have to pay a lot of attention to it once you have your decisions made and your system set up and then you’re free to <laugh> do anything else with your mind and your time. Um, so I think that’s very insightful. It’s not something that has to consume you continually, forever and ever and it shouldn’t, it shouldn’t be exciting, honestly, like you said, I mean I find it nice over time, you know, check the investment balance periodically, especially if things are going well, you know, in the market. Yeah, go ahead and check it. If things are not going well, don’t check it. <laugh> don’t look, you don’t need to know.

Michele (18:41): Yeah, it’s, it’s kind of crazy too just when, when you do get to like a stable place and you’re able to invest regularly, just looking back at my account over the past five years, it’s like, wow, like I didn’t think that this would add up to this much, you know, with the compound interest and this payments that I’m making. So yeah, it’s very satisfying. I will say once, I know not every grad student is able to contribute as much as I am, but even like if you can’t contribute until you graduate, like just starting out now is also, um, still gonna be help people out in the future.

Budget Breakdown: Housing

Emily (19:20): Okay. Let’s dive into those five, those top five expenses. Um, and feel free also to share how they’ve changed over the course of time in graduate school. Um, and I know number one is gonna be housing, it’s always housing for everybody. Um, so share about the rent payment that you’re making and share about how you only have one roommate now instead of two, like before. What’s going on with that?

Michele (19:42): Yeah, so basically when I started, um, the rent was probably, I mean I couldn’t really have gotten cheaper rent somewhere else, but it was $375 a month, which is insane <laugh>. Um, but it was $375 a month because we had three grad students living in a shared house with like one bathroom, one kitchen. And so that’s kind of why we decided. We had one roommate who graduated and moved out and she lived in like the top floor, which she was a trooper for living up there because it, it was like an A frame and so it’s not like a super great spot if you’re tall like me, I have to kind of lean when I go up there. Um, and so we were, my other roommate and I were still living here. We were deciding if we wanted to have someone else on the lease, but our other roommate had graduated and moved out. So we had the summer to our ourselves and during that time we were like, well, it’s really nice like sharing the bathroom with one less person, not having as much, um, to think about like the kitchen space as much. Like we still kind of had to plan around like our meal prepping around each other, but it wasn’t quite as bad as it was with three people since we didn’t do like a, we didn’t like cook together, we all cooked individually. So that was also a challenge. And so based on that and we both, my roommate, uh, who I lived with for the past three years was also on the GRFP, so we decided okay, we could probably swing to having just two of us. So that meant that our rent, it’s gone up slightly more since then, but currently it’s at $600 a month. So it’s still very affordable compared to other places around us as well and like living by ourselves would’ve been.

Emily (21:22): So your, the whole house is $1200 a month and you and your roommate are each playing paying half.

Michele (21:29): Yep. And so that roommate that I mentioned, she graduated in December, so she moved out and then, um, we, I think technically she’s my current roommate is like subletting her portion of the lease, but we’re gonna resign it in for the next year and then that’s gonna go up slightly to 630 a month each. So it’s going up by $60, which my landlord apologized, but I was like, it’s really not that much compared to like other places because he had like his property tax go up in his like rental fee. So.

Emily (22:00): Sure. And I’m also doing some quick mental math, um, that’s around 20%, right? Maybe a little over 20% of your gross income a little bit higher if we’re talking about net income, but really quite again, quite manageable. Like nobody is feeling rent burdened right on 20%.

Michele (22:17): No, no, it’s been, it’s a pretty affordable rent I would say. I know that, um, like some of my friends who live alone, they’re paying around like, um, eight to 900 a month for theirs. And so then there are other grad students though who are in like a shared housing situation. I think that’s pretty common for Michigan State at least.

Emily (22:42): Yeah, well I can see that even though you’ve elected to pay more in rent than you absolutely could have, um, still seems super affordable. Hopefully you’re getting use out of the space and you like only sharing with another person, like you said. Um, anything else you wanna talk about in terms of your rent expense?

Michele (22:57): It helps that, I’ve had great roommates who like, I think living with other grad students is really helpful ’cause you know, they’re all gonna be like respectful and um, kind of respecting your time. And also like that you’re also like both maybe working from home sometimes if you need to. So I think it, it’s really nice when you have like great roommates and I, I, I also prefer that because it helps you save money in other ways too if you’re, if we’re talking about like the financial side of it, but also like, I think the emotional side of it is great too to have someone like living with you. But um, it’s also nice like, you know, you can have your roommates like give you a ride to the airport if needed or pick you up from somewhere or like, just like take care, water your plants. My previous roommate had a cat and she never had to pay for a cat sitter ’cause I would always take care of her cat for her. So yeah, it’s just things like that, it’s just very useful to have a roommate I think. And I, I enjoy living with roommates. So.

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Budget Breakdown: Groceries

Emily (25:28): Let’s talk about your grocery expense. I know that’s number two on your list. Um, so tell us about your grocery spending.

Michele (25:35): Yeah, so I just looked at it for the last month, which it came up to $250. I would say that’s pretty average for me. I did go to a conference in like the beginning or at the end of April. And so like that was all covered by like a travel award. So I think it’s usually ranges between like $250 and $350 a month depending on like how much I’m spending or like if I have to do like a restock or something like that. And I will say I’m vegetarian so that also helps me save a lot of money too ’cause I’m not buying meat. So yeah.

Emily (26:08): Definitely. What do you find are other ways? ’cause I know yes meat is expensive, but so is dairy, so are nuts. So are, you know, other things, there are categories there that are expensive as well. Can you share anything about the way that you eat? Like do you have certain go-to meals or do you uh, batch prepare things? How does that work?

Michele (26:27): Yeah, so I guess I’m trying to think about like my day. So like for breakfast I usually just have the same thing. I have like two eggs with toast, so it’s pretty basic and I kind of know where to get like cheap, the cheap bread now, well I’d say cheap bread. Cheaper bread. I like don’t wanna get the like just tiny squares of white bread. I like to get good stuff. But um, yeah, like Trader Joe’s, we just got one of those in East Lansing, so I usually go there for that. Um, and then for lunch and dinner it’s usually like I will cook like on the weekends and then also like maybe on like Wednesdays or if I have time during the week and then I’ll just have my leftovers for both lunch and dinner. And then I also do what I call my bridge meals. So I’ll get like something like gnocchi at Trader Joe’s or some other frozen meal that if I’m like traveling or coming back and I don’t wanna make sure that I’m not ordering like takeout or something like that, I’ll have that ready to go. Um, and then that helps me too. And then as for the meals that I’m cooking, they’re usually, uh, pretty basic, some variety of having like beans or lentils with veggies and so those are all pretty cheap. Um, I do also do protein shakes, so that’s a little bit more just because I’m getting like protein powder and Greek yogurt and things like that. But, um, another way that I’ve saved some money on groceries too is I, I wish that I’d realized this sooner, but one of the grocery stores near me has a 10% off like discount for students. So you, with your student id, you can get um, 10% off groceries, which is really nice.

Emily (28:06): I hadn’t heard of that before actually. That’s amazing. Is it like a co-op or like locally owned or?

Michele (28:10): It’s actually one of the Meijers, but it’s like oh, the downtown location. And I think that maybe they were having issues like getting people to go there because it’s a little bit of the way for some people maybe, but yeah, I think, I’m not sure why they’re offering it, but I saw the sign and I was like, I have my student ID.

Emily (28:29): I was just gonna ask how you found out about it. So it wasn’t like another student who gave you that tip, you just saw a sign at the store?

Michele (28:34): Yeah, I literally just saw a sign at the store, so now I’ve been telling all my friends like, you guys should go here and get this 10% off with your student Id <laugh>.

Emily (28:41): Yeah, that’s amazing. What a good, I mean it’s a good idea for them, um, because yeah, most people don’t, I mean if you’re really frugal you would shop at multiple different places, but most people don’t shop that way. And so it makes sense to try to capture like people’s, you know, become the primary shopping destination for more people.

Michele (28:58): Yeah. And then the other way I save money on, on groceries, well is kind of getting into transportation, but I like to bike to go to the store <laugh>, so ah, um, that also saves you money because then you’re not buying anything that’s really bulky. So like, I’m not buying like pop or I guess, sorry, soda, um, Midwestern coming out, but um, things like that or, uh, any other like seltzer water, things like that I’m usually not purchasing. So.

Emily (29:27): Um, I would imagine also cuts down on impulse purchases if you’re looking at your, your backpack or your bags or whatever you’re using to carry the groceries. Um, I have a strategy that I now use, which is like, I very rarely physically go into grocery stores. I do all online ordering and then do pickup, um, which keeps like the impulse purchases at a minimum. 

Michele (29:46): Yeah, <laugh>. I will say that I, I’m not always going to the store with my bike so I, there is times where the impulse purchases still do come through, but it’s also just like a very enjoyable way to spend like a Saturday morning or afternoon even though the stores are kind of busy at that time, but it’s like a nice little bike ride to get there. So at least for me when I’m going to certain stores it’s like, um, like a nice trail. So

Budget Breakdown: Utilities

Emily (30:14): Yeah, I love to hear about that. Your next expense you told me is utilities. Lots of different utilities under that umbrella. Tell us about those expenses. Um, what they amount to typically and how they’ve changed.

Michele (30:25): Yeah, so those have gone up obviously since we have one less person. That was kind of when we were deciding if we wanted to have only two people live, the utilities, that was our sticking point because those can get quite pricey. So I looked at my past month and it came up to around $200, so that’s with electricity, water heating, cooling, internet, trash. And I also include my phone bill in that. So for like the first, obviously the phone bill I’m paying on my own, but everything else is split between my roommate and I and those are pretty variable just because, well I guess like the electricity and the water usually stays pretty, um, similar but like the heating and cooling, it’s more expensive in the winter here in Michigan to heat the house. And then we usually try not to use the AC unless it’s like super hot outside in the summer. And then the internet and the trash are also like pretty affordable. Um, I’ve actually managed to save money on utilities for the internet by switching from like a different provider. And then I also lowered the internet speed because most of the time, unless you’re like playing a lot of video games or something, you don’t need the speed that they give you as like the baseline. So yeah, that’s my utility bill.

Emily (31:49): Yeah, I love that you were, you know, conscious of that evaluating it because stuff like internet bills, they’re not the biggest things in your budget, but as fixed expenses, if you can just put in the like 30 minutes of effort or whatever it’s gonna take to like research it and, and call the company or chat with them or what have you, um, then you can sometimes get that bill lowered and very little effort, very long payoff like throughout the course of at least the next year. So that’s awesome. Have there been any other ways that you’ve decreased your spending on utilities over time?

Michele (32:23): Yes. So some of these people might not wanna do because they do take a little bit of extra time, but some ways that I’ve been able to lower my utility bills has been um, I line dry my clothes, which is obviously a lot easier when you’re in the house, but the dryer is kind of an energy hog.

Emily (32:41): I did that too during grad school.

Michele (32:42): Yeah, I actually, um, yeah, I have some like hanging up downstairs right now, but yeah, I just gotta, gotta time it if you like, need your like clothes at a certain time, like you gotta do like a day in advance, but it’s pretty easy. And then the other thing, um, my roommate who moved in probably doesn’t know what she’s getting herself into, but uh, I layer up in the winter, so kind of try to reduce heating bills by lowering the thermostat. Um, I think that’s a pretty obvious one. But then also in the summer, like running fans and keeping the blinds closed, um, like I said also the internet, but then my other thing I did was in Lansing at least the trash is you pay dependent on like the size of your trash and so I switch it to like the smallest size possible that only comes every other week. So that’s another way that I save money,

Emily (33:33): Another fixed expense that you managed to lower and as long as you’re confident you can like meet those, you know, those limits then that’s great.

Michele (33:41): Yeah. And then the last thing that just happened recently that I’m super excited about, I don’t actually know it’s gonna affect my energy bills at all, but, uh, I kept kind of pestering my landlord about our dishwasher and we just got a new one. And so even if it’s to save us money, it’s, it’s better because it’s a lot quieter so, and I don’t have to try to clean it as often. So yeah, that’s some ways to that I’ve done that. Well then I guess also the, um, for electricity, I don’t know if this is the case, like if it’s the same hours in other places, but our utility provider has like, uh, off peak and on peak hours, so we try to run like our bigger stuff like the dishwasher and the washing machine during those off peak hours.

Budget Breakdown: Restaurants & Social Activities

Emily (34:27): Definitely. Alright, then let’s move on. What is your fourth largest expense each month?

Michele (34:33): Yeah, so this one, the next two are kind of variable, but for this past month it was, um, $160 for restaurants and other social activities. So like this past semester I was the social chair and so I, I hosted some like department happy hours or I guess co-chair. And so that was, you know, we , would go out to like some bars and get like a drink or two and then also just going out to eat with friends as well.

Emily (35:03): And has that changed over the course of time?

Michele (35:05): Yeah, I would say that I, when I first started grad school I was a lot more frugal with those like kinds of social activities. I tried to limit them a little bit more, like tried to have people over at my house rather than going out as much. But now I’ve been that I feel like I’m in a better financial position. I have been going out to eat more often. Um, and then I guess another thing that I’ve started doing is I’ve been doing some sports leagues, so do like, um, adult volleyball or um, sand volleyball as well. So those have like higher costs to them as well, but they’re pretty affordable I would say, especially spread over the like the weeks that you’re participating in them.

Emily (35:50): I just love this that, you know, getting this picture of you at the beginning of graduate school and now four years in, like you’ve found ways to spend less in certain areas. You’ve also decided that it’s worthwhile to spend more in certain areas and still along the way you’ve done all this investing in debt repayment and it’s absolutely wonderful. So I’m very glad to hear that, you know, you’re putting your dollars where you value them.

Michele (36:10): Yeah, it’s, it is definitely like an adjustment because I feel like for so long, like you, like I said, I, I volunteered for AmeriCorps and then in undergrad I was like just saving money all the time and so it’s been nice to be like, okay, I have a little bit of breathing room now and kind of let loose a little bit more with some of my like, like I can go out to eat more often now. So it’s been nice.

Emily (36:36): I think we should do another follow up interview in another four years when you have a proper salary <laugh>, like, we’ll see, we’ll see where you are then. Are you, like, are you still very low spending or have you managed to, you know, moderate with the newer income or are you going crazy with investing? Like, yeah, we’ll let’s put a pin in that and, and return to it. Um, okay, your fifth, uh, highest expense in your budget? What’s that?

Budget Breakdown: Transportation

Michele (36:57): Yeah, so this one was also higher for this month because I went on a trip but, or kind of a trip I went home to visit family. Um, the transportation was $125 and so this usually is closer to $70 for car insurance and gas. But like I said, I like to bike a lot, so my gas is usually pretty low, which is also good for the current gas prices.

Emily (37:23): So it sounds like you have a paid off car, right? Can you tell us about your car?

Michele (37:28): Yeah. Okay. So for the car, it’s basically the same one that I’ve been driving since high school and like I said, my parents are very generous and so they made sure that me and my siblings each had a car. Um, and yeah, I basically don’t put any miles on it. I just use the car basically for like big trips and then if I do need to, like I’m going to those volleyball leagues that are kind of further away from campus then I’m driving to those things. But I, I try to keep my driving to minimum, which also is, is the money, but also because I’m really cognizant about my carbon footprint being in the Fish & Wildlife department. So I, I try not to drive as much as I can.

Emily (38:07): I see. And another way that you have found a kindred spirit in Mr. Money mustache because he definitely writes a lot about not owning a car or minimizing your car usage. So how do you commute to campus?

Michele (38:19): Yeah, I, I bike to campus so I have, the way I do it, I have like, um, a mountain bike that I put like a rack on the back and then I have two like bike bags that I attach. So it’s plenty of room for like my laptop and any other things I need to bring like books or um, like a change of clothes if I’m going to like work out or something like that. So yeah.

Emily (38:42): Have you thought about getting rid of the car entirely and if so, what, why are you keeping it?

Michele (38:48): I have thought about getting rid of my car, but I don’t want to because it’s very hard to live in the US without a car. Um, just like I said for those times where I am doing like a trip or something. And then also for those times where I’m traveling a bit further on to the outskirts of town, it’s basically if I just like worked and stayed at home, I wouldn’t need it. But since I do value those social activities then I do still need the car.

Emily (39:20): It is great. I feel like for something like this where it’s like, yeah, I get some marginal utility out of it. It’s not like a daily thing. It’s good that it’s falling to number five on your list and it sounds like some months it might be even lower, right? ‘Cause in particular you had a trip that you took this month, so in some months it might even be outside of the top five. Um, and that’s about the right size for something that is like, yes, this enhances my life in some, some way. It’s not totally essential. So it’s good that it, you know, that it is a paid off car and that the insurance doesn’t sound like it’s too expensive and, and you’re not using it that much. So the, the operating costs are not very high.

Michele (39:54): Yeah, I will say I did use it more this past semester than I have in the past just ’cause it was a particularly intense Michigan winter um, so I drove to campus a bit more than I usually do and um, just kind of had it on retainer a bit more than I usually do. But yeah, I’ve been usually like biking through the winter too. So.

Emily (40:17): How do you park on campus when you do drive?

Michele (40:20): My office is kind of on the outskirts so um, it’s kind of far away and so it’s not like, um, as big of a deal for me to park over there than it would be so I kind of just risk it on getting a ticket <laugh>. Um, and usually I, so far I’ve been fortunate but for my office parking, but if I am going on further onto campus, I pay, there’s like a pay by plate option so I’ll pay like five bucks or whatever it is for however long I’ll be on campus.

Emily (40:51): Gotcha. So once again, the car comes into use and these like occasional, okay the weather’s particularly bad occasional scenarios. Um, great. So that’s your backup plan for getting to campus is you have your car and you can <laugh>, um, skirt the parking regulations since there don’t seem to be any consequences <laugh>.

Michele (41:10): Yeah, well there is, um, there’s tickets but I somehow have avoided the parking attendants, um, just because it’s kind of for off the beaten path for them. But yeah, ’cause I think it wouldn’t really be too much, but um, the grad students are always doing that calculation like, how many tickets <laugh> would I need to get before getting a parking pass? So, so far it’s kind of the math that’s worked out for me.

Best Financial Advice for Another Early-Career PhD

Emily (41:35): Gotcha. Well we’ve run through your top five expenses. I mean, I’m just so pleased that like you’ve, you know, honed in what’s, what’s of value to you over time that you’ve obviously had these great financial accomplishments, you know, especially coming up in another year, whatever the timeframe is on your graduation, you can really say, wow, look at all these things I accomplished financially during graduate school. It’s incredible. We will wrap up with the question that I ask all of my guests and I know I asked it of you before, but what is your best financial advice for another early career PhD? And it could be something that we’ve touched on today already or it could be something completely new.

Michele (42:11): Yeah, so I have a few things. When I was thinking about what my best financial advice would be, the first thing is to track your spending as I think it’s really helpful to plug any holes where you don’t realize where you’re spending more money. Like for me, I’ve been spending more recently on going out to eat than I have in the past. And so the way that I’ve done that is I’ve mentioned Fidelity a lot because I use them for basically everything, but um, they have this really nice thing where you can connect all your credit cards to one location and so that way you can kind of automate the tracking. Um, and like if you, you could also probably add in like if you’re Venmo people or using cash for something, then you could track it that way as well. And then another thing that I probably, I think that was my last, last time I was on, I talked about the Roth IRA, but I recommend not only sending money to your Roth IRA but making sure that you’re depositing funds into a, some sort of fund because I, I have talked to people in the past who have only put it into the account and not invested in it. And so just gotta make sure that you realize that it’s not a normal bank account and you need to invest the money. So those are my two big pieces of advice.

Emily (43:24): Yeah, so mistake I literally made with Fidelity with the first IRA that I opened, I don’t know, hopefully their interface has changed <laugh> in the intervening time, but I for sure made that mistake. Also, I’ll say that at the time mutual funds were the thing to invest in and there were higher minimums. Now we have ETFs and it’s a little bit more flexible. So another thing to look out for to make sure that you know, you’re investing appropriately and that your money is not just sitting in a money market account.

Michele (43:50): Yeah, yeah. I’ve helped, um, multiple people like set up their Roth IRAs, so I’m always like, okay, make sure you have to pick one of these funds now. And I try to, I think people get overwhelmed by choosing, so I’m just okay if here pick one of these three <laugh>, they’re all basically the same though. So

Emily (44:07): Yeah, definitely. Um, I list this when I teach about getting started with investing, I list this as like a separate step. Like one send over the money, two, make sure it’s inve- like a few days later. Like make sure that it’s actually invested where you intended for it to go. And it’s not just randomly like you missed a step there. It’s a whole other thing you have to consider. Um, absolutely. Well Michele, it’s been so great to have you back in the podcast. I’m so delighted by this update and thank you again for volunteering. It’s been great to speak with you.

Michele (44:36): Yes. And thank you for having me on again. I appreciate it and thank you for all of the great work that you do with this podcast and helping everyone out with learning how to <laugh> navigate finances as a grad student.

Emily (44:46): Yeah. Thank you for saying that.

Outro

Emily (44:58): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by me and show notes creation by Dr. Jill Hoffman.

How This PhD Solopreneur Manages Her Time and Money

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In this episode, Emily interviews Dr. Leslie Wang, the professor-turned-solopreneur behind Your Words Unleashed and repeat podcast guest. Leslie works as a developmental editor and career coach primarily for academics. Leslie and Emily discuss in detail how Leslie manages her time and money, balancing the appointments and payment schedules of approximately three dozen clients throughout the year. Leslie has molded her business to fit the life she wants to live, including frequent travel and personal and familial pursuits.

Links mentioned in the Episode

How This PhD Solopreneur Manages Her Time and Money, Money Story with Dr. Leslie Wang

Teaser

Leslie (00:00): You know, maybe moving away from the idea that the work needs to be its own reward, or that, you know, money and meaningful work are somehow detached from each other. I think that they’re very much can be part of the same thing. And it’s not a zero sum game. And I think I’m a really good example of that is that I feel like I earn very well using the skills that I learned in the academy.

Introduction

Emily (00:34): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (01:02): This is Season 23, Episode 10, and today my guest is Dr. Leslie Wang, the professor-turned-solopreneur behind Your Words Unleashed and repeat podcast guest. Leslie works as a developmental editor and career coach primarily for academics. Leslie and I discuss in detail how Leslie manages her time and money, balancing the appointments and payment schedules of approximately three dozen clients throughout the year. Leslie has molded her business to fit the life she wants to live, including frequent travel and personal and familial pursuits.

Emily (01:34): This time of year, mid-April to mid-June, is my reflection and planning season. I consider what types of financial education I want to offer my university clients in the upcoming academic year, and there may be a big shake-up in store for this one. When I pilot new workshops and programs, I typically offer them to my mailing list subscribers for free or at a steep discount so that I can work out the kinks and receive feedback. If you would like to be the first to know about these opportunities, please join my mailing list through PFforPhDs.com/advice/. As a bonus, you’ll receive a document that catalogs all of the financial advice given by my podcast guests at the end of our interviews. By the way, this is the last episode of Season 23 of this podcast, and I’ll be back in mid-June with the start of Season 24. You can find the show notes for this episode at PFforPhDs.com/s23e10/. Without further ado, here’s my interview with Dr. Leslie Wang of Your Words Unleashed.

Summary of Dr. Wang’s First Podcast Episode and Recent Updates

Emily (02:50): I am delighted to have joining me on the podcast today, Dr. Leslie Wang, of Your Words Unleashed. Leslie is actually a repeat guest on the podcast. She was on way back in season 11, episode 10, released almost exactly four years ago from when we’re recording this May 2022 to May 2026. And so I’m just really excited to hear all the updates that we have. So Leslie, can you kind of take us back to, you know, maybe a summary of where you were at that point, what we talked about in that episode, and then tell us what’s happened since then.

Leslie (03:21): Sure. So when I first appeared on this podcast, and thank you so much for having me back, I was still a faculty member, so I was a tenured professor of sociology at University of Massachusetts Boston. Um, maybe just like a little bit of background about me. I got my PhD, uh, from UC Berkeley in 2010. And then I did all the things. I had a two year postdoc. I had two different tenure track positions, um, and I wrote two, sole authored scholarly books, a lot of articles. And around the time I went up for tenure, I was really burnt out and I was looking for answers to the question of, is academia still for me? And I decided to train as a life coach the same year that I went up for tenure. And that was in 2019. Um, I had a baby a few weeks before COVID hit, and then I was on parental leave and sabbatical all during lockdown.

Leslie (04:20): And so during that time it, I think a lot of people were just really soul searching. And I was definitely doing that. And I realized that like I did not want to stay in the academy forever. And so that’s when I started building my business. Your Words Unleashed and it also has a podcast to the same name. And so all of that was happening when I was still a faculty member. Um, so I think when I talked to you, if it was like early 2022, I knew I was gonna leave. I had no idea when, and then three months later I decided to leave <laugh>. It was like that. So basically, I, I still remember all it was, um, was I got an email from the chair of my department asking what my course preferences were for the fall. And at that point I was like, I can’t do this anymore. I’m done. And I’m like, I have to resign. I have to resign. So I did. And basically, you know, my contract went through I think August 31st, 2022. So I ended up just fully leaving. At that point I did have a full fledged business and I had launched it early 2022. Now it’s 2026, so I’m moving into the fifth year. Um, and so, you know, basically I am a full-time writing coach. I help people, uh, demystify the scholarly book writing process and create a practice that really centers their own values, um, and helps them, you know, express themselves using a more authentic voice and trying to get away from a lot of the sort of jargon, um, and insular nature of a lot of academic writing. Um, and I also do a lot of career coaching as well for mostly tenured faculty members that are looking for like a renewed sense of purpose.

Leslie (06:13): And I think right now, as we all know, it’s very hard times in higher education. And so I kind of do a mixture of both. I’d say maybe like two thirds of my clients are long-term writing coaching clients for, for whom I do a lot of developmental editing as well, and that’s most of my time. And then maybe about one third are career coaching clients. Um, and so I’m happy to talk about any aspect of, you know, launching my business, going full time into solo entrepreneurship. Um, but I would say the difference is that like now I’m very happy with where I am. Like I’m really satisfied with, um, I think balance is a tough word, but like the alignment I think that I’ve been able to create between my career and my life that I did not have in any way, shape or form in academia. And I probably didn’t have the first few years of my business as well.

Structuring Time and Staying Accountable as a Solopreneur

Emily (07:07): Yeah. Well I wanna hear more about that now. Um, I’m always curious when I get to speak with, um, especially people who, like we were just talking about, have a lot of agency over their own, you know, um, calendar and over the kind of work that they do, whether that’s inside of academia or outside. I’m always curious to hear about, um, how people hand handle their time and how people handle their money. And there’s sometimes so many parallels between those two. So let’s start with the first one. Like, can you tell me what, um, an average work week looks like for you? How you structure your time, how you maybe keep yourself accountable to the work that you need to do?

Leslie (07:42): Yeah, totally. Um, and it, it, it’s an interesting thing to reflect on ’cause it’s changed a lot since I first started my business. And I think a lot of business owners are gonna say this, but the first couple of years you were just working your ass off like you are, there’s not a lot of limits. And I think also coming from academia where there’s definitely no limits or boundaries with work I was, I was overworking and I was aware of it, but I wasn’t in control of it. So now moving into year five of my business, I am in control of it after having experimented a lot with like, what is the right amount for me, um, when factoring in the other things in my life that I wanna be devoting time to. So, you know, I would say my weeks vary quite a bit, but I typically have about five to seven, hour long, um, client sessions per week.

Leslie (08:35): And like I said, about two thirds of my clients are there for writing, coaching and developmental editing. And for each of those sessions I need to take anywhere from two to four or even five sometimes hours outside of that meeting to review the work, give feedback and that sort of thing. Um, and then the other sessions are with career coaching clients who I don’t need to prepare very much for. Um, and so that means I really need to space out my, my writing coaching clients to not have more than about three in a week, otherwise I just can’t keep up. And this is definitely a trial and error thing and I’ve come to realize that like summertime is not a relaxing time for me for the most part because academics are on, they’re producing a lot of material they wanna meet more frequently. Um, so I’ve become much more rigid around like how many clients I will take on at a particular time.

Leslie (09:33): Um, and then thinking about like how do I sort of structure people so I’m not overloaded in a week? Because, you know, after you work with someone for a while, you realize how much time it’s gonna take you to look at their work versus another person’s work. And then I have to factor that all in. Um, and so yeah, and then I normally have maybe like one half hour free coaching consult per week. And again, I, I stretch those out as well ’cause I don’t, I also don’t want people to have to wait too long after our consult to work with me. ’cause some people will have like a six month waiting period and you’re probably gonna lose those clients <laugh>. Right. So trying to kind of think about people’s time and um, and my own time. Um, but really like I just use Google Calendar to organize my time.

Leslie (10:28): I, I think I’m a much more visual person. I color code everything. So all of my client sessions are in green, dark green. Um, my consults are in light green, exercise is light blue, you know, other kinds of, you know, health appointments are purple. Like I’m always trying to, I’m always looking at it, um, and trying to figure out like what needs to be moved around. But yeah, for the most part it’s um, I think knowing now like what kind of life do I wanna lead? Like what does that actually look like on a daily basis? How much time do those things take? Say like, I want to, you know, be able to cook dinner four times a week. That takes a lot of time and that obviously takes away from other things that I can do. But if that’s a priority, then I need to think about my clients and how to move things around so I can fit it all in.

Emily (11:23): Let me ask about your Google calendar. Um, so you mentioned in that some things about like appointments, um, or even like an appointment with yourself, like to exercise. Uh, do you then look at open space and see, okay, that’s when I can do my prep or that’s when I can do the other work for my business? Or do you actually block out times of like, okay, this is when this type of behind the scenes work is going to happen, this is when this type of behind the scenes work is gonna happen. How do you, how do you um, plan for those kinds of work blocks?

Leslie (11:54): You know, I’m not quite as, um, probably detailed as some folks where they, they will block out the entire day because I like to have immense flexibility with my time. But I would say the first three hours of my workday, so about like 8:15 to like 11:15 or so is I’m a hundred percent on which means I’m probably gonna do the hardest work during that time. So if there’s um, you know, developmental editing, especially challenging editing I need to do, that’s gonna happen during that time. Um, and then coaching is probably gonna happen after that. So I have blocks that I, I give like specifically for coaching, it’s either gonna be between, I’d say 10:00 AM and noon or between 2 and 3:30. And that’s like, those are the blocks and I just kind of have it mentally in my head unless they like live in another continent or something.

Leslie (12:54): And then oftentimes we have to move things around. Um, but I had made a decision a couple of years ago that my clients need to work with my schedule because I had been doing a lot of like trying to coach people in Australia and it, so it was like 7:00 PM my time and I was exhausted and I had a baby and I was like, what am I doing? Um, and so I just started putting in more boundaries around my time and I’m like, if they wanna work with me, they will figure out a way to do that. And that’s, um, I will work with them within the range that I can work with them, but I’m no longer going outside of that. Right. And I think people also don’t know how many clients any one person has. And so I have around 35 clients at any one time and they’re going at different paces. Some of them are like on parental leave and I’m not gonna see them for six months. Others are meeting like very regularly every month for years. Um, and so it’s this dance, it’s like a constant, um, consideration of like, how’s, how are all these moving parts working together? Whereas I’m the only constant, so I gotta be, yeah, I gotta make sure that I can show up for all the, all the people and their needs without feeling overstretched. And that takes years to figure out, I think.

Emily (14:19): Yes. And especially ’cause like you said at the beginning of a business, you just wanna say yes to everybody and everything. And the boundaries you do, you don’t realize how much it’s going to affect you to not have good boundaries until you’re a little more busy and you’re a little more established and you have your work rhythms down and so forth. Um, you mentioned earlier that summer is a really busy time. I’m wondering if you’ve noticed any other seasonality to your work and whether you sort of lean into it and you go with it. Yeah, summer’s busy. I work longer hours in the summer or whether you try to like make it more regular throughout the year.

Leslie (14:51): That’s a really good question. I’ve tried to observe annually, but I do think it’s hard to tell under the Trump administration and like all the cuts that are happening in higher ed, um, it’s taken away regularity maybe. But if I had to, I think I, I definitely have a big drop off in, you know, people wanting to meet or even new clients probably in September and then towards the end of the year, because I did notice last September I had a couple weeks where it felt very spacious <laugh> and then it all ramped up back again. Um, maybe like, you know, beginnings of semesters can be a little slower end of semesters for sure are slower. There’s a lot of rescheduling in April, May. Um, but at this point I feel like it’s busy. It’s just busy most of the time.

Emily (15:48): I’m thinking about this from my own schedule as well. You know, you mentioned traveling and we’re, we’re in May now and I’m thinking about my summer schedule and I go to a couple conferences. So those are unusual weeks. I also have vacation scheduled and I also am thinking about how do I move around these blocks of work that I need to do to avoid these weeks when I have these other special, you know, things happening. And so, um, that’s very interesting that you’ve sort of built that into, for me it happens in the summer, but like you’ve built it into the, the rhythm of your business that you do a lot of traveling and you manage to not work during those weeks, which is pretty incredible. How far out do you have to plan that to like, make sure you’re not scheduling client meetings or whatever during that time?

Leslie (16:25): Well, it depends on how long I’m away. So if it’s only like a week, it’s usually doesn’t disrupt anyone. Um, but then in the summer we always go to Europe for like two and a half weeks. And that period of time, if you add on the jet lag afterwards, like I have like three weeks where I don’t really work. So that is much harder. And that’s why I’ve stopped taking on so many clients in the summer. Like I won’t start for the most part, start new clients then ’cause I have to fit everybody else in. Um, and I just treat those like, uh, compressed periods of time. But I would say I don’t not work at all. I I have to take it back. I don’t, I do some work on vacation, but it’s always like, um, I’ll have people send me their, their papers to read and I’ll, I’ll read those in like, you know, when I got 45 minutes there and you know, on the plane for example, great time actually to be doing this work. Um, I still do emails, like I don’t check out completely, but I’ve never been someone who did, you know, some people like to like not touch anything regarding their work when they, when they’re on vacation. I like to keep my mind still in it a little bit. Like I might be editing a podcast episode or like putting things up on my website. And I think that’s more of a personal preference ’cause I actually enjoy it when it’s, it’s feels like more of a choice almost. Like I’m getting ahead a little bit when I’m doing it on vacation and it’s very small amounts.

Emily (17:55): Yeah. So you’re getting some like pleasure or satisfaction out of that as well. So it’s not like taking away from vacation. It’s like, it feels good to do a little work. I I do the same thing. I had a week long vacation, like sort of over winter break this last year and I was really debating with myself like, do I finally leave my laptop at home? Do I finally like really disconnect? Um, and I ended up taking it with me, but I, I felt like it added to the experience, not like, took away from it. ’cause it was like, yeah, planes are like, oh, we have to wait in our hotel room until this activity starts. Well the kids are watching TV and I’m gonna do a little, you know, this other work. Um, so anyway, it worked out for me.

Commercial

Emily (18:32): Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, frugality, increasing income, or student loans, each tailored specifically for graduate students and postdocs? I offer seminars and workshops on these topics and more in a variety of formats. This is a perfect time to book me for a workshop at the end of the current fiscal year or at the beginning of the upcoming academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, or postdoc office? My seminars are usually slated as professional development or personal wellness. Ask the potential host to go to PFforPhDs.com/financial-education/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

Behind the Scenes of a Solopreneur’s Business Finances

Emily (19:57): Okay. We’ve, we’ve talked a lot about time, which I love to discuss, but again, the other parallel kind of is money. So I’m very curious about how you operate your business finances.

Leslie (20:09): I mean, I have to say I have kept my business extremely simple. So to the point where, you know, my financial planner and CPA are like, you need more expenses, <laugh>, because I don’t employ anyone except a podcast editor. Um, I have a coworking space so that I’m not completely isolated at home. I have some various sorts of scheduling tools, zoom and that kind of thing. You know, my podcast recording, um, platform costs money. But you know, in terms of like keeping track of everything, I, I do have, you know, a credit card that’s, uh, a business card that I try to put everything onto just so when it comes tax time, it’s very clear what I spent things on. Um, you know, I keep things organized bank account wise too. So I have a Capital One account that is just dedicated to retirement contributions that get pulled out weekly, um, into a Roth IRA. I also have an account dedicated just to estimated quarterly tax payments. And so at the end of each quarter I pull from there. So I’m, I’m constantly sort of shuffling money around. Um, and I would say, you know, I’m constantly also updating these financial spreadsheets that I have and one is for me where I keep track of all of my monthly income. And the other one is with my financial planner where we’re, we’re looking at that kind of together. I put in my total monthly income in there. I also use it to keep track of my, um, all of my expenses and also keep track of my, uh, estimated quarterly tax payments. So basically, you know, I had worked out, and this is why I think having a financial planner is amazing, especially if you’re going to be moving into owning your own business. I wouldn’t have known like what percentage of my income should I be putting into retirement right now? Um, how much should I be paying for taxes? Like all of that. I think having guidance like CPA as well right is, is extremely important just in giving this peace of mind that you’re doing, you’re just like, you’re doing the right things. Um, and you’re not gonna be um, surprised, you know, April 15th kind of thing. So in general, that’s how I manage my finances. I don’t know if you have like more specific questions about money.

Emily (22:36): Yeah. So I think you mentioned a lot of great stuff there and I think because you’re working with a financial planner, probably the first thing was you do have a separate checking account, right? As well as credit card.

Leslie (22:47): Actually I don’t, I experimented with having a business checking account and it turned out that I just wasn’t using it. So I do keep it all together. 

Emily (22:58): Okay, so the revenue for your business comes into your personal account or accounts. But you keep all the expenses on a credit card so they’re easy to track, right? Because, and you’re also tracking it aside from just it being on the credit card, it sounds like you’re also doing regular, uh, bookkeeping. And then you have these other, it sounds like savings accounts where you set aside, you sort of what I do, I call it a system of self withholding. Um, so you’re putting aside the, the money that will eventually make it over to the quarterly estimated tax payments that’s gonna go to a separate account. You have another account or you pull aside the future retirement account contributions that eventually get over there. Um, okay, interesting. Well, as long as your financial planner is okay with it, like obviously it gets like the stamp of approval, but obviously keeping, having everything going to one credit card is very organized and that’s probably, um, a sufficient level of organization to, you know, comply with like the IRS regulations and so forth.

Emily (23:52): So that actually takes away one of my future questions, which was do you pay yourself like a salary or what, but if all the revenue is coming into your own personal account, then it’s already there. But then sort of maybe the corollary to that is, is your business’s profit, let’s say, you know, the revenue minus the expenses, minus the taxes, minus the retirement, is that very regular because you have these like long-term relationships with clients? Um, or does it vary quite a bit month to month and then you kind of have to deal with that on the personal side?

Leslie (24:25): Yeah, I mean I think that it varies month to month, but annually it’s very stable, right? So from the beginning I was, yeah, from the first year I launched my business, I earned over six figures. It has stayed that way and it’ll go up when I take on more clients. And then I made a very conscientious decision to not overwork. So then it’s come down, but it still sort of hovers around the same place. And because of that, it’s easier for me to estimate how much I need each month because my own expenses don’t change a whole lot. Um, but that, you know, like I am primarily paid by academic institutions, they have their own timelines. Sometimes it takes a very long time to get paid depending on the bureaucracy and what’s going on there. Like, there have been some campuses where I’ve been waiting for nine months and there’s literally, it’s somewhere in the system. Others pay me before we start. And so that’s, that’s what I’m dependent on is kind of, you know, do I know how they’re gonna be paying me? Do I know when they’re gonna be paying me? Um, and then having enough to get me through the months where it’s, it’s just gonna be lower because I just put in a bunch of invoices and things take at least 30 days, maybe 30 to 60 days. So yeah, that’s, it’s something that I have gotten used to over time, but it get, it’s just, I would say it’s fairly disconcerting at the beginning because you’re like, it feels like you’re not earning any money, but then you look at the end of the year and you’re like, oh, the totals are the same or the totals are even higher.

Emily (26:09): So my business also has a great degree of seasonality. Like, um, high season is like just following tax season, right? When I send out all the invoices for the tax education that I did, and then the money rolls in as you said, over the next, you know, one, one to two months usually sometimes longer. Um, and anyway, so there’s sort of these very lumpy times of year where I get a lot of revenue for the business and there’s other times a year when almost nothing is coming in. Um, but I still have expenses to pay. So that to me is like something I don’t want to have touch my personal finances. So that’s why I keep like a separate business checking account. All the revenue goes there, all the expenses come out of there. Um, and then I pay myself a salary from that account, which as you said, over over time, you know, you kind of figure out okay, what the annual is gonna be and then the salary is kind of based, you know, a little bit lower than that in case of some fluctuations and so forth. Um, but anyway, I don’t want that to touch my, the personal finances side of things ’cause I don’t wanna see like months where I’m making negative money <laugh> in like my personal account, you know? Um, it sounds like you don’t have maybe quite as much variation. Um, I as I do.

Leslie (27:12): I don’t think so. I don’t, I, yeah, I don’t think so because I do have a year-round business. I don’t think, um, I don’t work tremendously less, I would say, except for those holiday periods, uh, which are built in. So, so that’s why it was a little hard to answer the question about seasons, because I think in some ways I’ve stopped having seasons.

Emily (27:34): And I guess you, you sort of started to answer this before, but like, how are your clients paying you? You said some pay after the fact, some pay upfront. Are these lump sums? Are these monthly retainers? Like what’s the kind of schedule of client payments?

Leslie (27:49): Yeah, and that’s a really great question and it also depends on the institution. So, you know, I’d say 90% of my clients are using institutional funds and I’ve noticed like small liberal arts colleges tend to just pay a lump sum before you start. There doesn’t seem to be as much bureaucracy involved. Some of these bigger R1s, um, they will pay as you go. And so then I just decide like how many invoices will I send? So for, I, I typically take people on for eight sessions. That takes around at least eight months. Um, so usually I’ll, I’ll invoice maybe every two or every three depending on how quickly they’re, they’re moving through. I really don’t wanna do it every single time. It’s just, it’s, it’s just more work on everybody’s part honestly. Um, but I’ve lately, uh, there’s been some schools that have asked me to invoice every time. It’s just easier for them for their own financial reasons to do that. So, um, and then the folks who pay out of pocket, we just decide what works for them. So if they’re doing a six session career coaching with me, they might pay every two, um, they might pay half at once. And so it becomes very individualized.

Emily (29:09): I can see why you end up just looking at this on an annual basis and it’s like so many different frequencies and contracts and lump sums and yeah.

Leslie (29:16): And it’s also like they might be paying through a credit card link. They might be paying through PayPal, they might be sending me a paper check, they might be sending a wire, you know, I’m working with someone in Hong Kong and it’s like a telegraph transfer, which I had never even heard of before. So it’s a constellation <laugh> of ways that I get paid. And that is a good, you know, five, at least 5% of my time I would say is, is put towards figuring out how to get paid, making sure I get paid and do, you know, dealing with the money.

Emily (29:53): I have also had to set up systems around this because I realized earlier on, like, oh wait, did I receive that check? I’d have to go back into my bank account and figure out, oh wait, this anonymous, you know, payment ended up, you know, from this institution and now I have much better systems around like receiving, noting, you know, sending a thank you, like all the things that go along with that. And I noticed at one point, this was a couple tax seasons ago, that I was like psychologically somehow like procrastinating sending out the invoices. Like for all the work that I had already, this is the work already delivered right <laugh> from that tax season. And I was like, why am I procrastinating this? This is so weird. It’s like an undeserving thing or something like that. So now I’ve just have that, I just have my assistant do that. Like she does all the, not all, but a lot of the invoicing goes through her because like I just wouldn’t do it in a timely manner. And she doesn’t have the like baggage <laugh> around sending invoices that I do apparently. So, yeah.

Leslie (30:46): Interesting.

Emily (30:46): It’s, it’s been a learning process.

Leslie (30:48): I, I, for sure, I have to always, uh, like I on that spreadsheet for myself where I keep track of payments, I also have to keep track of did this come through Stripe? Did it come through PayPal? Was it a paper check? Was it a wire? You know, I have to know that because for taxes, you know, and I didn’t know that initially. So it’s like over time. And then I also, one spreadsheet I didn’t mention that I use constantly is I have a client sessions spreadsheet where I can see, and I have it all mapped out with months, you know, when did they start? How many sessions did they sign up for, how many did they have left? And I’m constantly also color coding that around who still needs to pay. Um, I have another color code for who has two or fewer sessions left because then I can know when is someone gonna finish so I can, uh, confidently take on another client without overtaxing myself. So it’s another thing that I, it’s like almost like checks and balances, um, around time, around finances, around like, yeah, did I get paid from them yet? Or like, what’s, what did they decide? Were they gonna do three payments? Like I have to know all of that stuff, but I don’t avoid, I like, I I find that interesting for some reason. <laugh>,

Emily (32:08): Yeah. I’m glad you like, kind of brought it back to like this overlap of time and money and tracking and scheduling and like all that stuff. ’cause there are so many like parallels between the two. So thank you so much for answering those questions. I’m always just so curious how other people operate and um, I would imagine for people who are inside bigger institutions, like, um, universities, this would be fresh information. Like they can see what it looks like on the other side, like dealing with money. No, we have people to do that. Well, no, you have to hire ’em or you have to do it yourself.

Leslie (32:34): I mean, I did not know that when I was a faculty member, right? I knew very little about how to run a business and, um, and the good thing is that it’s a set of skills <laugh>, and you can learn it and you will learn it over time. You have to, if you wanna be successful and sustainable.

Advice for PhDs Interested in Self-Employment

Emily (32:52): Let’s talk now then about how you would advise another PhD, maybe particularly a faculty member who’s interested in self-employment. And I may have even asked you this question in our first interview, um, but I’m curious to see if the answer has changed. Like how would you advise someone and maybe you, you do part through part of your career coaching, sometimes this question comes your way. What’s like one really solid piece of advice you can give to someone who’s curious about self-employment?

Leslie (33:17): Well, maybe following up on what we’ve been talking about is there’s a really big difference between having a really good idea for a business or even doing work really well and running a business, right? So like for example, like in my coach certification program, there were a couple folks that were incredible coaches. I mean, they were so like innately talented at it, but they did not have the skills to turn it into a business. And I don’t know if they really wanted to either, but you could see how like there’s skills for the work and then there’s skills of running a business. And I think, you know, listening to this podcast and other business podcasts is really, really helpful in shedding some light on the areas where you probably need to grow. Um, I would say also to really think about what you’re bringing to the table that is different from everybody else who is doing similar kinds of work.

Leslie (34:27): For the field of developmental editing that I’m in or even writing coaching, there’s a huge amount of people that have come into this area in the past few years, which makes a lot of sense. You know, if there’s an exodus from the academy, this is a very transferrable skill. It’s very aligned with how people were trained. So it’s not like this mega leap. At the same time, if you don’t, if people like people like clients or like the, the world out there doesn’t know how you think or how you, how are you approaching this that’s different from the 75 other people you just saw on LinkedIn. There’s really no reason for them to be interested. And so I think that comes down to this word that I think a lot of academics are scared of. And I was too when I was an academic, which is called Marketing <laugh>, um, which is really just about creating connections with other people.

Leslie (35:24): And I think allowing them to get to know you in certain kinds of ways that give them insight into whether or not they wanna be in your orbit. Not necessarily whether or not they wanna hire you, but whether they think you’re a compelling human being and they wanna be in your realm because you really don’t know, uh, how people are gonna hear about you, right? So maybe they wouldn’t hire you, but they would be aware of the things that you’re doing and the things that you’re saying online, um, and really like what you’re doing and refer you to somebody in their department. I think that kind of thing happens all the time. But that comes down to getting more comfortable with visibility. And so I think self-promotion can be a very tricky thing for many academics. I have podcast episodes on this, like how hard it is for I think most academics to put themselves out there because it often feels egotistical or it feels like you’re bragging or like why are you drawing all this attention to yourself?

Leslie (36:30): And I really had to shift that mindset to get comfortable. And this is like incrementally over time with putting myself out there again and again and again and taking small risks and with, you know, sharing my opinions, sharing my experiences, sharing my reflections, also sharing about my work. But it was the whole sort of spectrum of things that I think is why I now have like a pretty good platform on LinkedIn. I’m not usually even talking very much about coaching. Um, I’m talking about, you know, what I think about academia or, you know, sharing my own experiences of leaving. Um, so I think what it comes down to is if people can think about self-promotion as more of like sharing, you’re sharing your story, you’re sharing your insights, it’s more relational and you’re actually creating relationships with other people, then that can be something that really helps your business. Because in the end, like we, we need each other. We, we need people to know about us and you need to know about other people doing stuff too. Like we, it’s an ecosystem, right? And so part of that is I think, uh, allowing yourself in very small ways to be seen.

Emily (37:52): I, I found what you said so inspirational, you know, for me to use in my own business. I like that reframing. But it also strikes me that successful academics also do this. I mean, we might call it, we probably wouldn’t call it marketing, right? Inside academia, but I mean, I have had like for instance, Dr. Gertrude Nonterah on the podcast to talk about personal branding. Like not even personal, it could be just professional branding, like of yourself as an academic and the type of research you do, the networking that you do like at all. It’s applicable there as well. It just may not be a skill that the types of people who are attracted academia are, um, naturally many of them are not naturally inclined, but in either setting it’s a very useful thing to learn.

Leslie (38:28): Totally.

Dr. Wang’s Contact Information

Emily (38:29): Well, Leslie, this interview has been so delightful and, and I’m glad that people can get to know you through, you know, this platform and this interview. Um, if people want to, you know, connect with you, maybe potentially be, become a client or just wanna be in your orbit as you were talking about, where can they find you?

Leslie (38:44): My website is yourwordsunleashed.com. My podcast has the same name. Um, people can always reach out by email as well. Uh, my email is [email protected]. I’m also on LinkedIn. I’m all over LinkedIn <laugh>, so connect with me on there.

Best Financial Advice for Another Early-Career PhD

Emily (38:59): Perfect. Um, and then we’ll wrap up with the question that I ask all of my guests, which is, what is your best financial advice for another early career PhD? And this can be something that we’ve touched on in the interview already, or it can be something completely new

Leslie (39:11): In kind of thinking about it now. And what I really had to do to go from academic to successful business owner is like, it’s really about financial literacy. It’s like learning the things, right? And I think that many, I have known many academics who take an approach of like more head in the sand when it comes to finances because, um, partly it’s that like academics don’t make a lot of money. You have a delayed, um, there’s a delayed period of time, I guess, uh, before which you do earn, start earning a salary hopefully, um, in the academy. And I don’t know, there can be just some fear I think around like, I don’t know if I’m doing the right thing. And then I think the other thing is in the academy there’s this idea that the work is its own reward. So finances are secondary. You are lucky to have a job, especially if you get a tenure track position where there’s so few these days. You know, I recently posted something on LinkedIn or someone, I reposted something where this man was saying he just got a tenure track job offer of 57K in 2026, you know, and I was like, my very first offer was 54K in 2011. Like, what is happening here? So, you know, maybe moving away from the idea that the work needs to be its own reward or that, you know, money and meaningful work are somehow detached from each other. I think that they’re very much can be part of the same thing and it’s not a zero sum game. And I think I’m a really good example of that is that I feel like I earn very well using the skills that I learned in the academy. Um, I understand what’s transferable about it, but I have much more breadth now and I’m able to align that with a life that feels meaningful too. So maybe part of it is like I would first start by thinking about what kind of life would feel really good to you and how does work fit into that versus what’s the work I want and how do I fit my life around that? And I know that’s a very privileged thing to say, but I also think it’s something, it’s a really good thought exercise for all academics to do. There can be more alignment.

Emily (41:42): Well, I think that’s a beautiful place to end it. Leslie, thank you so much for coming back on the podcast. It’s been a pleasure speaking with you.

Leslie (41:48): Thank you for having me. This was super fun.

Outro

Emily (42:01): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by me and show notes creation by Dr. Jill Hoffman.

Sacrificing for a Lofty Financial Goal on a Grad Student Stipend

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In this episode, Emily interviews Dr. Jed Kim, a recent PhD graduate in chemistry from the University of Wisconsin at Madison. Jed built a $35,000 Roth IRA by the time he finished his PhD due to consistent $500 per month contributions. Jed and Emily discuss what it took financially to maintain that savings rate, from applying for fellowships and bank bonuses to sharing food with multiple roommates to engaging in free and low-cost activities. Jed speaks openly about how spending too little at times hampered his mental health and how a family emergency caused him to rethink his approach. This interview illustrates the trade-offs graduate students have to navigate when striving to make the PhD less of a financial liability.

Links mentioned in the Episode

Sacrificing for a Lofty Financial Goal on a Grad Student Stipend, Money Story with Dr. Jed Kim

Teaser

Jed (00:00): I have to do this in order to do my dream job of being a, being a researcher and a scientist. So how do I make this so that this PhD is no longer a liability but an asset for me, both financially and like career wise?

Introduction

Emily (00:22): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (00:52): This is Season 23, Episode 9, and today my guest is Dr. Jed Kim, a recent PhD graduate in chemistry from the University of Wisconsin at Madison. Jed built a $35,000 Roth IRA by the time he finished his PhD due to consistent $500 per month contributions. Jed and I discuss what it took financially to maintain that savings rate, from applying for fellowships and bank bonuses to sharing food with multiple roommates to engaging in free and low-cost activities. Jed speaks openly about how spending too little at times hampered his mental health and how a family emergency caused him to rethink his approach. This interview illustrates the trade-offs graduate students have to navigate when striving to make the PhD less of a financial liability.

Emily (01:45): This time of year, mid-April to mid-June, is my reflection and planning season. I consider what types of financial education I want to offer my university clients in the upcoming academic year, and there may be a big shake-up in store for this one. When I pilot new workshops and programs, I typically offer them to my mailing list subscribers for free or at a steep discount so that I can work out the kinks and receive feedback. If you would like to be the first to know about these opportunities, please join my mailing list through PFforPhDs.com/advice/. As a bonus, you’ll receive a document that catalogs all of the financial advice given by my podcast guests at the end of our interviews. You can find the show notes for this episode at PFforPhDs.com/s23e9/. Without further ado, here’s my interview with Dr. Jed Kim.

Will You Please Introduce Yourself Further?

Emily (02:55): I am delighted to have joining me on the podcast today, Dr. Jed Kim. He graduated with a PhD in chemistry from UW Madison, um, in June, 2025. And we’re gonna be hearing today mostly about his financial journey through graduate school and specifically what he did to build up a $35,000 balance in a Roth IRA by the time he finished. So that’s really exciting. So Jed, welcome to the podcast. Will you please introduce yourself a little bit further for the audience?

Jed (03:23): Yeah. Hi. Um, I’m Jed. I got my PhD from UW Madison. As you just said, um, I was an avid, uh, runner. I, um, I liked, we have two cats right now, so a big animal lover and for the most part I like going out in nature, which is why I went to UW Madison as well.

Emily (03:40): I have had the pleasure of visiting in the summer, and I found it quite lovely. Um, I don’t know about the rest of the year. 

Jed (03:48): Yeah, summer’s probably one of, personally, I think it’s one of the best and worst times ’cause that’s when all the mosquitoes come out, but also like the lakes are just so beautiful. Um, and if you go like, uh, fishing at the, at either Monona or uh, Mendota, it’s just great. Also, like all the wilderness, all the trees. It’s super nice.

Financial Position at the Beginning of Grad School

Emily (04:09): Well, that’s wonderful. Let’s take it back to the beginning of graduate school. I wanna know kind of what your financial position was and also your mindset was going into graduate school. So can you tell us, like, you know, did you have any assets at that point? Did you have any liabilities and what were you thinking about money when you first started graduate school?

Jed (04:28): Yeah. Um, I guess we could, um, going into going into graduate school, I was very lucky where I got a lot of, uh, I guess it sort of like my financial journey starts in undergrad, right? Where I had a part-time job in undergrad, as well as my second part-time job was like applying to as many scholarships that were even remotely relatable to me as possible. So all throughout all that I was able to come out of, uh, undergrad debt free. So like, I had no assets, but also no debt. So there’s, there was a little toss up. So I pretty much started grad school at zero. I think I maybe had like a thousand dollars. Um, the outlook was, uh, when I first toured UW Madison, they said that it wasn’t really a place to like build wealth. It was just a place to like enough of a stipend to survive. And I was always an overachiever. So I was like, okay, how could I make this stretch as far as possible? Um, I got a, um, I got a minor in entrepreneurship and business, so I was really financially focused at that at that time. So I want to like really say, okay, I have to do this in order to do my dream job of being a, being a researcher and a scientist. So how do I make this so that this PhD is no longer a liability but an asset for me both financially and like career wise.

Emily (05:44): Oh, I love the way you put that and I love how, um, conscious of that fact you were going into it. Like it is, it is for most people, the financial reality is yeah, you’re just gonna be treading water, if that, during a PhD. But, um, I’m so curious now to find out how you went against that narrative. Um, especially that local narrative. ’cause it’s not the same everywhere, um, to start building wealth and as you said, not let the PhD be as much of a financial liability. Love it. Can you tell us what your stipend was at the start of grad school?

Jed (06:15): Um, I think it was, well, like it was high 20k, low 30k, and it stayed that way throughout the entirety. I think, I forget the exact numbers, but I think it started off at 28 and ended around like 32. But if, I could be wrong with a couple of thousand here or there, I don’t, I don’t think, I think it’s relatively reliable. I mean, you know, if you’ve had a lot of interviews, that’s pretty much just standard stipend for most PhDs.

Emily (06:42): Yeah. And I do know that UW Madison, at least from the previous interviews I’ve had, not a generous stipend. Definitely not.

Jed (06:48): Definitely not. Yeah.

Emily (06:50): Yeah. And what year did you start grad school?

Jed (06:52): Um, I started in 2020.

Emily (06:54): Okay. Uh, interesting time to start graduate school. Um, you moved, you were, you know, you were on campus the first year?

Housing Expenses During Grad School

Jed (07:02): Yep. No, no. So actually that’s the first way I, I started saving money. Um, before starting grad school, I, I made sure to message all of my incoming, um, grad school, you know, class. And I tried to get as big of a, um, number of people in one place as possible. So we found a house near near UW Madison. It was like a, still a 10, 15 minute walk. Uh, there was a bus that went straight to UW Madison, but I ended up spending only like six to $700 a month in rent. So that, that was like a, I really wanted to stay under like half a paycheck for, for that first year so that I could like, sort of get my, uh, um, feet under me when I first moved it.

Emily (07:47): Okay. This is an amazing tip already for both prospective and current graduate students. So how many, it sounds like you’re renting a single family home? And how many other people did you share it with?

Jed (07:57): So initially it was four, and then one, one person did end up dropping out it, in total, it was about three people. The rent though, was really, uh, we, it wasn’t the best first place. Obviously, as you stay longer and have it, um, in undergrad, you have no money <laugh>, like, pretty much all my money went into paying back, uh, paying back my, uh, student loans. But in the first year I was trying to stay, uh, as lean as possible. The rent, I think was like 1800 some, somewhere around that, maybe 18, 1900 for the whole house. Um, so it started off as four. When it was four, it was great, but, uh, we, like rent was super cheap, but then afterwards it got a little more expensive. Utilities, we kept it at as, at a minimum, I remember us trying to turn off the lights as much as po-. It was all the, all the things where you could scrounge as much as you can, as well as like splitting the internet bill, which was, which is a set cost. A lot of the set costs ended up being split among three, four ways. So that really reduced like the monthly expenses.

Emily (09:00): And did your roommates have a similar, oh, you also shared food. Oh, okay. Did your roommates have a similar mindset to you about wanting to be pretty frugal?

Jed (09:08): One of them did, the other did not. So there was a big room, a medium room, and a small room. The big room person, we just gave it to them. They paid, they paid like an extra 150 a month. The small room person paid like, like a hundred dollars less and I got the medium room. So I, I was considered like the base rent. I’m not sure how that worked out, but it ended up being pretty good. Uh, in the long run,

Emily (09:35): I’m spending some time on this because the housing decision for graduate students is honestly make or break for a grad student’s budget. And and you were so smart to know that going in, like knowing that as a prospective and rising first year, um, is that, was that the same housing that you kept throughout graduate school or did you end up moving?

Jed (09:53): So, um, in grad school I moved every single year. Um, mostly because every single year for some reason, rents kept going up. So I was trying to find a way to, uh, to minimize that. The first year, first first two years, we stayed in that place. Second year, um, we tr I tried to get another roommate, but that sort of fell through. So I found a, uh, uh, apartment that I rented on my own that was the most expense I spent on rent. And then the last two years I actually moved in with my now wife, then fiance. Um, so that ended up splitting rent as well. Um, but rent usually stayed around that when I lived by myself, it was like a thousand dollars, which was a lot. It was. But luckily at that time the, the stipend ran- randomly increased in UW Madison. So there was like a sort of cost of living adjustment, I guess. But, um, yeah, so it was like around that six to thousand dollars mark throughout the entirety.

Transportation Expenses During Grad School

Emily (10:56): Okay. Yeah. So good to know. And I really hope people are taking this message to heart. Um, I also moved a couple, maybe three times during graduate school. Um, a couple of those times were motivated by rent increases that I was like, I, no, I, we can do better elsewhere. Um, what about your transportation situation? Did you have a car? Did you not?

Jed (11:16): Yeah, so that was actually like a deliberate decision. My parents really were, were badgering me. Like, oh, you’re in America. You had to get a car. You have to get a car. I’m like, a car is a monthly expense. I just cannot, I could afford Right? Like a car payments. The car payments is one thing, but the car insurance was something else, something else. And as well as if you get a car in Madison, you have to have it covered. Otherwise it’s gonna like snow over you and ruin the car. So, um, I just took the bus everywhere. It was definitely a time drain, but it was just something that I had to do in order to like not go into debt while in grad school. 

Emily (11:55): And what about your peers? Did a lot of them have cars or a lot of them made the same decision as you

Jed (12:00): Most took the bus. Um, the ci- the bus, luckily the bus system in Madison were, was actually quite robust. So, uh, whether you lived like 30 minutes away or an hour away, there’s usually some sort of bus line that gets you through. Um, for instance, like I lived, I didn’t live in Madison City, I lived in Fitchburg, which really saved a lot of money at in that way. Um, there was a direct bus line that went straight from our apartment to the ma- uh, to Madison. And that really helped.

Emily (12:25): So, uh, I managed to live car free for exactly one year of my life, and it was glorious <laugh> and I have not achieved it since. Um, but I know like the questions for some people who maybe they have a car currently, but it, it is expensive and they’re not using it like that much. Like, talk to me about, okay, let’s say someone has like the daily commute solved around town. They know how to do that. What about those really outlier things where like you would really, it would be very convenient to have a car for X reason, like when you’re traveling or something like that. Like how did you solve those? Like, very rare but acute needs for a car.

Jed (13:01): So it really helps to have friends. First of all, <laugh>, if you have friends, um, um, outside the graduate school program, I found that that really helped me. Um, usually, uh, every grad school has some sort of like big industry, like industry company nearby, and that usually employs some people that aren’t in a PhD program. Um, I remember, uh, in Madison usually we go to Chicago or something like that for a trip, um, for a day trip or weekend trip. And usually the people that work at Epic or or in the U- University it’s entirely would sometimes like schedule like a road trip. And we, and that way I would avoid that flight, uh, that, that trip. The renting a car situation is actually not too terrible, especially if you know that you’re not gonna be in the, uh, in the city. So, and you try to plan as much as you can to not travel in the winter, and that way you don’t have to worry about the over, like the covered parking situation that you really had to worry about.

Investing $35,000 in a Roth IRA During Grad School

Emily (14:05): Gotcha. Thank you so much for those, um, insights. Okay. We’ve gotten a picture into your largest fixed expenses, right? Housing and transportation. And we also got a picture into your mindset, which was don’t let the PhD be as much of a financial liability as usual. And so, you know, I mentioned up top that you managed to build up a Roth IRA of $35,000 by the time you finished graduate school, which is incredible. So I wanna hear kind of some things that went into it that, did you do anything on the income side? Did you do anything on the expenses side aside from in housing or transportation that we’ve already covered? So kind of take this where you will, like how did you manage to, you know, save and invest that much?

Jed (14:43): Yeah, I mean, the lar- the fact that my largest expense, um, monthly was $600 really helped. Right? So, um, I was able to sort of squirrel away around $500 a month every month for my entire PhD. Um, and that comes to around like 6K, $6,000 a year, right? Um, luckily I started in, well, okay, I don’t wanna say luckily, but I started investing around, uh, 2020. And there the, uh, the, uh, s- like I mostly focused on like ETFs like, um, international and local ETFs, and those did pretty well. So that really helped with the growing, but the majority of the Roth IRA is still my own contributions, which I’m hoping won’t happen too for too much longer. But right now that’s kind of where it’ll, it’ll stuck.

Emily (15:33): Yeah. So let’s, um, talk a little bit about on the income side. Now, as you know, you mentioned during your undergrad that you applied for so, so many scholarships. Did that continue during graduate school or how did you apply those lessons in grad school?

Jed (15:45): Yeah. Um, first three years, no. Um, but then af- because the first three years is the first year it was mostly like COVID really hard to like sort of get acclimated to the university. Um, second year, uh, there’s these quals called, uh, TBEs that UW Madison has you take. So I was focusing on that. Third year there’s another qual called the RP research proposal, um, that you have to take as well. So those three years pretty much I was just trying to survive <laugh>. Um, um, but then in my fourth and fifth year I was really looking at like external fellowships. Um, I was lucky enough to get one that was, uh, tangentially related to the research I was doing. So the A-C-S Medi, um, I, if you are in the medicinal chemistry or in the organic chemistry field, I highly recommend that you do apply to that one. Um, it’s a very generous fellowship as well as, uh, a allows you to go, they pay for an entire trip to the Gordon Research Conference, which is a really good networking opportunity. Well, it was for me. Um, and then other fellowships I applied to that were a lot smaller were like, um, some scholarships I previously applied to in, um, in undergrad, but you know, in grad school format, um, there’s a grad school, uh, or post undergrad, uh, program as well.

Emily (17:03): And did these fellowships actually increase your stipend or was Madison just like, thank you very much for the money. Your stipend stays the same

Jed (17:11): That, for the ACS Medi? Yeah, it was pretty much your stipend stays the same. Um, they did give me a little bit, I think like four or $500 extra, but it was pretty much, I mean, if you talk to someone from UW Madison, you kind of know that there’s like a whole internal process where all the fellowship money goes into the university, they take the taxes out and then, um, and then they, uh, get give you the rest. That’s actually how I found you because I was, look, I got my first fellowship and I was like, what is going on? How do I use this money? Like what, how do I, like, do I get extra money for doing this? Because technically the stipend was more than I was making, uh, sorry. The fellowship was more than I was getting from the stipend, so I was like, do I get a bonus or, but it was pretty much they get it, use it to pay for my insurance, and then I could get like maybe two, 300 extra dollars extra. Which was a little bit disappointing. But

Emily (18:02): Yeah, it can be. And that’s something where I definitely want grad students to be aware that that could be the outcome. And so you have to know your motivation when you apply to fellowships, is it purely I want to increase my stipend, or is it also I want the prestige, I want this on my cv, I wanna get to go to a Gordon conference? You know, you have to know your reasons, because if you’re applying purely for the money and then your university just absorbs the money, that will be very, very disappointing. I, but it sounds like some of the smaller ones were able to stack.

Jed (18:27): Yeah, the smaller ones was able to stack a little bit, but again, they were so small that when I asked the university, they were like, yeah, it’s fine. Just it went directly to me. Yeah.

Emily (18:38): So you did have a conversation about it, you like disclosed it and yeah.

Jed (18:42): Um, I talked with our, uh, our advisor and she was like, yeah, it’s fine.

Emily (18:47): Um, and then when you won the larger fellowship from ACS did you ask about receiving more of a bonus than a few hundred dollars? Like did they turn you down? How did that work?

Jed (18:58): I did, and then they sat me down and said, here’s all your expenses that we pay for health insurance. You’re not getting that. I was like, okay, that’s fine. And then, okay, <laugh>, I, I kind of just left at that. It was, it was a, uh, in the end it was like a great experience for me anyway ’cause again, they paid for the Gordon conference as well as, um, it’s a, it was a huge boost to my cv. Um, it was a particularly, um, uh, prestigious fellowship, so it was more, I guess prestige wise, but yeah, in the moment I was like, ah, $38,000 extra will be great. And then didn’t happen.

Emily (19:32): Yeah. Um, okay. So that sounds like that about sums it up on the income side.

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Emily (19:39): Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, frugality, increasing income, or student loans, each tailored specifically for graduate students and postdocs? I offer seminars and workshops on these topics and more in a variety of formats. This is a perfect time to book me for a workshop at the end of the current fiscal year or at the beginning of the upcoming academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, or postdoc office? My seminars are usually slated as professional development or personal wellness. Ask the potential host to go to PFforPhDs.com/financial-education/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

Reducing Expenses with Roommates, Costco, Sharing Food, and Low-Cost Experiences

Emily (21:04): Do you wanna talk about how you sort of managed or even maybe, you know, reduced your expenses over time in these non housing, non transportation areas?

Jed (21:12): Yeah, of course. So both. Mostly I if stay with roommates for as long as you can, that’s the best advice I could give because not only does it split the rent, but it really like, I don’t know how, how, how it is for you, but utilities are kind of expensive, especially Madison, where it’s like sometimes the utilities could go up to like 150, $200. Those are severe months. But, um, paying that by yourself, it it beco-, it ends up adding up to becoming an extra rent payment. And, um, if you split it among everyone, it becomes way more manageable. Where, where even the expensive months, like it ranges from like 30 to $60 instead of like 50 to $200 and that makes, that makes life a lot easier.

Emily (21:57): Now you mentioned earlier that you all shared food. Can you tell me about that?

Jed (22:01): Yeah, so we usually go, we, um, so conventional, uh, grocery stores, if you go weekly, ends up being really expensive. So what we did was we, we would go to Costco together and we’d get like those bulk deals, like the bulk beef, the bulk pork, um, giant trays of like eggs. And then we’d all just like split the, split the expenses, uh, which, you know, economically fa favorable, but also those meats could be frozen and we could, we usually like use them for like hot pot or like Korean barbecue nights. And then it was like really financially feasible. Um, Wisconsin also has like weirdly cheap beef and pork, so it was like really helpful there. But if we bought ’em individually from the package, I did the math, I think it would’ve been like two, three times more expensive. So I was like, that’s not gonna happen. We, we literally bought yeah, bags of like meat

Emily (22:52): I distinctly remember like discovering Costco when I was in graduate school and realizing, like you just said, like, you don’t have to go through six pounds of meat in a week, like just freeze it. So like if you have an operating freezer, like you can buy in bulk, even if you’re just, even if it’s just one or two people, you know? And it’s still, it’s still pretty feasible. So I was not, of course you might not buy, you know, 48 ounces of ketchup or whatever, but there are definitely things at Costco that you can buy and manage to consume, um, you know, in a timely manner. Uh, so were you all only shopping together or were you also like cooking, like preparing food together?

Jed (23:28): So one of my roommates were, was in the same lab as me, so we did cook together. Um, someti, uh, I’m like, I love cooking. So usually what I do is I would cook for the entire group, um, and then like everyone could just eat what they want. Um, I would meal prep and then, and then we’d sort of split. I mean, the costs are all split and I actually do enjoy cooking, so it, it would end up working out. Um, sometimes people would, uh, in order to like pay me back for that, sometimes pay me back. Not really money-wise, but like they would make dinners. Um, so we would sort of not eat together per se, but still eat the same food. If that makes sense.

Emily (24:08): I honestly have never tried that cooperative relationship with anyone other than my, like family. It sounds to me it sounds challenging, but like, I guess it, for you, it seemed like it was working out, especially since you were willing to do a lot of that labor upfront as like a service to the household.

Jed (24:22): Yeah, like Sundays it was pretty much like for me cooking, a lot of the dishes I cooked are like Asian, right? And like if you have a giant pot, it doesn’t really matter whether you’re cooking for six people or one person, it’s gonna take the same amount of time, like a stew needs a stew for cer-a certain period of time. So I would just turn it on, it would be ready and then people would just take it as they need.

Emily (24:46): And would you like to share any other kind of areas in your budget where you kept a lid on expenses or managed to reduce expenses? Like what did you try during the course of grad school?

Jed (24:55): Oh, well, in grad school, I mean, you know, this like, there’s not really that much free time. So, but when you do have free time, um, you want to ch- uh, I chose experiences and things that I found like very fulfilling that didn’t cost too much. I mentioned fishing, I loved fishing. It was pretty, I mean, you just need a fishing pool and sometimes you can rent those from a friend. Um, you would go ice fishing at the on the lake, which is free <laugh>. Um, you would, we did a lot of like, uh, if you know, lake Monona and Lake Mendota, it’s actually a beautiful walk. So I would, I would run that. Um, I trained for a bunch of like marathons and, um, half marathons, a 5K. And again, all you need are like really good running shoes for those. Um, there was a new rock climbing gym <laugh> in Madison. So in order to advertise for that, I tried to go to as many free events as possible. So like I would still be experiencing the city, um, and still experiencing what, what, uh, what what can be done in the city, but also not pay too much. I did end up spending some money on some activities, but, um, for the most part, I try to keep costs to a minimum. ‘Cause I knew that after grad school I would have more disposable income.

Emily (26:07): I mean, that makes so much sense to me that, you know, in graduate school for need or for want, like you’re gonna choose activities that are pretty low cost, unless you really are roll rolling in the dough, it doesn’t make sense to pick up like an expensive gym membership when you could just be running outside, you know, that kind of thing. Um, so that absolutely makes sense to me. Like I know one of my big activities in graduate school was like watching basketball games, which it’s not free to attend, but it’s free to watch them. Like if you have a watch party at your friend’s house and I’ll bring a little bit of food, like, it’s very, very low cost. Um, so that was like a really enjoyable thing that I did. And yeah, my activities are different like on the other side of graduate school. Um, okay. So you mentioned to me before we started that you were a fastidious budgeter. Can you tell us a little bit more about that?

Tracking Expenses and Budgeting as a Grad Student

Jed (26:54): Yeah, so, um, I had an Excel sheet that I made in undergrad, sort of budget for how much I spend in everything from rent, health insurance, phone bills, food, fun activities. Um, I used, I, I play, I play, oh, video games is how is a lot, was also an activity I have. So like how much I spend on video games, how much I spend on computer stuff, accessories, things like that. Um, clothes, like every category you could think of, I have, I have it. And basically anytime I do anything, I just, I log it into the Excel sheet and then move on. Um, that, that first, oh, um, that first month where I first started was what I called my baseline pay, baseline spend. And I was eating out a lot more than I thought I was. So I, I went to USC in undergrad and USC if, you know, is very close to K-Town. So we would drive to K-Town a lot and spend a lot on Korean barbecue. I didn’t realize how much I was spending until I, I did this, did this exercise. So the first month was just tracking. The second month was using that tracked data. I would extrapolate what can I really give up and what can I actively see, use that money that I’ve given up into something more what I consider to be more, uh, rewarding. For instance, like instead of going to Korean barbecue, which is very expensive, maybe we go someplace cheaper, but also save that money to go on like a trip. Um, ’cause of that I was able to do a lot of things in undergrad that I normally, but that’s not really normal for an undergrad experience. And also like, was able to sort of carry on that mindset and, and sort of modify it. So instead of going on trips ’cause a PhD, you don’t really have time to go on trips that often. Um, you, I would use, uh, divert all of that excess spend, excess spend from my initial first month into, um, into savings.

Emily (28:48): Yeah, it sounds like an incredible approach. Can you tell us a little bit more about how you actually did the budgeting? I think you said you used a spreadsheet. Um, but any details about, like, did you also use software or like how many different accounts were you tracking?

Jed (29:03): Um, so I, if you open a, if you open different bank accounts, they do give you bonuses, right? So, um, I use that spreadsheet to sort of track among the different account that I opened in order to get the bonuses and then close them as, as the times as as as I didn’t need them or if, or if the burden became too high. Um, mostly it was three to four accounts at a time. Anything above that, I was completely overwhelmed. Um, four, I remember I tried to do five accounts at one point and that was just too much ju- money juggling and just ended up, I’ve ended up making some mistakes when I had five accounts, which is how I knew that five accounts is the end, four is my limit. So, um, that’s what, um, I also experimented with like how much money I can spend in each category without becoming too depressed. Like there’s a, when you’re making a budget, you’re like, oh, I could be super, uh, super, uh, militant and I could live this like nomadic lifestyle, but af after living a nomadic li like after living that very like Buddhist monk-like lifestyle for six months on top of doing all the work that’s required of you in grad school and really just like hamper you mentally. So I found like a how much I’m comfortable with spending while also not me-, uh, hinder like, um, hurting my mental too much.

How Investing Beyond Your Means Impacts Well-Being

Emily (30:27): Yeah, that makes total sense. And I think it’s also, again, a good message for like prospective graduate students or early on graduate students that, and I’m saying especially for those who set them up for, set themselves up with high fixed expenses, they might think, oh yeah, I’ll be totally fine spending 80% of my income between my housing and transportation. No problem. I’ll just be really frugal everywhere else that gets old very, very fast. It’s very hard to sustain that. So you were in the fortunate position that you had those low, you know, relatively low fixed expenses. Um, and so, but you have these high savings goals and that was what you were navigating with, like the rest of it. So, um, I’m really glad that you, you know, set those fixed expenses up to be on the moderate side, uh, from the beginning because you had that choice really, like it was okay to increase your discretionary spending once you realized that your budget was unrealistic.

Jed (31:16): Yeah, yeah. Um, there was, there were some times where I was sort of for-, I did, I was not doing well mentally, but I still had to do a on the lower side. Um, for some reason I was really obsessed with that $500 mark, um, in grad school. So if I, like, I did that first and then once it’s really hard to get money out of the Roth, IRA, so it was just like, uh, I paid myself first and then if I was suppo-, if I had to scrimp and save for the rest of the month in order to make sure that I could live, that’s kind of what I just did.

Emily (31:46): I see. Yeah. I don’t necessarily advocate taking it to an extreme that, you know, you’re kind of suffering under it, but, but I do really appreciate that approach of like, this is my savings goal and I’m gonna make the other numbers work so that my savings goal happened. Right. Because you paid yourself first. So like, I did it. I’m not taking the money back out. Like, you know, we gotta go forward with this. So I do appreciate that approach even though it sounds like you were pushing yourself at times.

Jed (32:10): Oh yeah. No, no. I do not recommend what I did. Um, I, if, if, if I were to give myself advice from back then, I’d be like, instead of moving it to the Roth ira, just put into a savings account. That way if you need to use the money, you don’t have to like, uh, pray that next day you have enough like milk, uh, to make cereal. So like, it was, it’s like really, like there were some months where it was like I was playing within like margins of like $10. That was completely, completely reckless of me. It was definitely, I was definitely, um, on the too far end of the, um, contributing.

Emily (32:46): I, I, that kind of takes me back to like my first couple years of graduate school where I really played like chicken with the bottom of my checking account. And, and I also, not as much as you were, but I was also investing into a Roth IRA at that time and like yeah could have just done less of that and had more cash on hand. And I, you know, I learned that lesson over time. So like over time I still kind of found a way to do the investing and also built up savings so that there was something there that I could dip into if it was an unusual month.

Jed (33:11): Yeah, I, that is, I really wish I did that. Um, the first couple years of grad school were really hard because for some I was like so militant on that number and I don’t know why I was so set on that number.

Dealing with Irregular and Unexpected Expenses During Grad School

Emily (33:25): How did you ultimately deal with like, irregular expenses? Because that was the thing that pushed me to have more cash savings was to be a- ready to pay for irregular expenses.

Jed (33:33): There was like a family emergency at one point, um, that I had to go back to California for. Um, and it was like the tickets were like $600 and for me that was like a lot of money, um, that month. I luckily it happened in the beginning of the month before I did my stupid thing and did that. Um, but after that event I realized, oh, shoot, I would’ve missed this if I, um, didn’t have that. So that’s when I started building a three, like building an actual savings account first and then start contributing back into the Roth IRA that year I contributed a little bit less, but I think it, like, I built like a thousand dollars, $2,000 savings account. Um, and that really helped with the money anxiety for sure.

Emily (34:17): Yeah. And like, I mean, what you just said, you saved a little bit less that year. But it bought you so much peace of mind for like every year going forward, right? So like, it’s so worth it. Like I, again, I did not do that myself at the beginning grad school, but that is what I teach now. I do teach at least a small emergency fund first before you do anything else. Um, and it, it just, it honestly makes such a big difference to your stress, even if you never have an emergency that causes you to need to use it. Like, you know that it’s there, you have that peace of mind. You can sleep better at night and so just delaying your investing by like a few months, you know, four months or whatever it was. Yeah. It bought you a lot.

Jed (34:56): Yeah, no, that’s, I, I wish I did that early in my grad school ’cause so that I wouldn’t have to be so stressed for the first three years. But luckily at the third year, I, I, um, some like family emergency happened and I was sorta like able to wake up

Emily (35:10): And hopefully some of the listeners will take this advice to heart and not have to have that experience before they make, you know, their own change. Um, well how did it feel, you know, when you got to your defense or your graduation and you had that Roth IRA balance, like did you feel accomplished?

Jed (35:27): I, um, I mean, I’m not sure how you feel about a Roth ira, but for me it’s just like a number. Um, I, I felt like it was something that I had to do in order to retire. So this is this, um, the way I felt was like it was, oh, I’m paying future Jed this this amount of money so that he doesn’t have to worry about too much. Also, something that really inspired me was, um, like a money, the money money multiplier effect, right? So early investing, um, in your early career ends up like multiplying by 32x, um, 32 to 48x and I was like, okay, I have, I put 35K in. So that means th- uh, that means if I multiply that by 32, I’m close to a million dollars. Okay. Jed has a, future Jed has a million dollars to play with next time. I suffered a lot, but I hope he’s able to use it pretty well.

Emily (36:22): Yeah, I mean, time will tell <laugh>, I certainly can also, like, I’m very glad that I did the investing I did during graduate school and I’m far enough out that I’ve seen, you know, that compound interest growth in a significant way. Um, but there were also things I missed out on. So like, it’s definitely a mixed bag and I don’t know, I, I’m sort of a more like a no regrets kind of person. So I think it was a good decision. But yeah, there were some things we didn’t do that, you know, were one time opportunities and they, they don’t come around again. So it’s all, there’s always trade offs.

Jed (36:52): Yep. Yeah. That’s how, that’s how I felt. But I graduated, I got a job, so I was pretty happy. I guess things were looking up

Best Financial Advice for Another Early-Career PhD

Emily (37:02): Good. Um, well let’s end on, I, you know, we’ve learned, we’ve learned so much from this interview you’ve shared so openly. I really appreciate that, um, to, you know, learn honestly about your financial journey through graduate school. Um, why don’t you leave us with, uh, the answer to the question I ask all of my guests at the end of interviews, which is, what is your best financial advice for another early career PhD? And that could be something that we’ve touched on in the interview already, or it could be something completely new.

Jed (37:28): Yeah. Number one rule number one advice is to get, get roommates for as long as you can. Um, I feel like I felt, I felt that even though I was playing on the riskier side of my finances in the first three years, because I had roommates, I had that check, like that ability to like mess up a little bit. We were able to rely on each other when we had really bad bumps. And if you live by yourself, yes, you still have your friends, they’re still your friends, you’re still gonna talk to them. But it’s really hard to have the same kind of relationship when you’re living with someone and asking someone for help that’s not inside the house.

Emily (38:05): Yeah, it is. I mean, it’s a different level of community that you have when you have roommates versus just friends you don’t live with. So, um, thank you so much for sharing that. Thank you again for volunteering to come on the podcast.

Jed (38:17): Of course. Thank you so much, Emily.

Outro

Emily (38:28): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by me and show notes creation by Dr. Jill Hoffman.

Holding a Financial Standard While on the Faculty Job Market

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In this episode, Emily interviews Dr. Dillon Pruett, an assistant professor in the School of Communication Science and Disorders at Florida State University. This is the second part of a two-part interview in which we discuss Dillon’s turbulent faculty job search and transition to a faculty position. A higher income doesn’t completely ameliorate all financial challenges, but the future is looking bright. Dillon’s candor during this conversation is laudable, and his experiences are likely to be both relatable and a cautionary tale for prospective and new faculty members.

Links mentioned in the Episode

Holding a Financial Standard While on the Faculty Job Market

Teaser

Dillon (00:00): I was, my jaw dropped. I was like, are you kidding me? Like that is, that’s really, really crazy.

Introduction

Emily (00:20): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (00:48): This is Season 23, Episode 8, and today my guest is Dr. Dillon Pruett, an assistant professor in the School of Communication Science and Disorders at Florida State University. This is the second part of a two-part interview. In the first part, Dillon and I covered his financial journey through his PhD and postdoc at Vanderbilt University. In this second part, we discuss Dillon’s turbulent faculty job search and transition to a faculty position. A higher income doesn’t completely ameliorate all financial challenges, but the future is looking bright. Dillon’s candor during this conversation is laudable, and his experiences are likely to be both relatable and a cautionary tale for prospective and new faculty members.

Emily (01:33): For Season 24 of this podcast, I plan to publish a series of Budget Breakdown episodes. These interviews follow a template in which the interviewee shares their income, current financial goals, and five largest expenses. I’m looking for four grad students to provide these interviews, so this is your official invitation to volunteer. I love that on this podcast I get to feature PhDs and PhDs-to-be who are almost exclusively regular people and learn and share their real-life stories and strategies. If you would like to break down your budget, please go to PFforPhDs.com/podcastvolunteer/ and fill out the quick form, and I’ll be in touch over email. I look forward to interviewing you for this summer series! You can find the show notes for this episode at PFforPhDs.com/s23e8/. Without further ado, here’s my interview with Dr. Dillon Pruett.

Dr. Pruett’s Finances During the Postdoc Years

Emily (02:43): Okay. Let’s talk more about your postdoc then. I understand you did your postdoc at Vanderbilt as well, and it sounds like you didn’t move right. Were you staying in the same condo during that phase?

Dillon (02:52): Yes. Um, so that was a really great transition because I ended up doing a postdoc with a professor who I had collaborated with during my PhD. And so, um, she was also on my PhD committee. So when my dissertation defense was delayed a little bit, um, she knew exactly why. She knew exactly when it was scheduled for. There was no issue of having to contact another university and get my offer extended or have to change, you know, my moving date or any of, of that. So that, that was really, really great. Um, I noticed, so I, um, was on a TL1, which is a clinical and translational science fellowship. Um, and so, uh, that came with a stipend, I think it was about $56,000. Um, and that also came with, um, paid insurance. And so, um, that was, that was a huge boost in the amount that I was, it was more than double what I had previously.

Dillon (03:58): And so it pretty much ameliorated all of the issues I had with like counting the dollars to the end of the month. I was like, well, shoot, like this is this, this is great. I feel like a normal human being that can, you know, get a burrito and not have to be concerned that that’s gonna impact me down, down the road. Um, so that, that was, um, really huge just for, to feel like I could take a breath of fresh air. Um, even on my, my postdoc, there were some discrepancies within, um, the department and, um, I felt like I was comfortable with what I was getting, but again, knowing that other people were getting significantly more, um, was like, oh man, like it makes me feel like I am, I’m less than. So I had a very niche focus for, you know, my PhD and for my postdoc, um, postdocs that had a, a more heavily quantitative focus that could work on multiple projects. Um, were getting maybe like $90,000 a year. Um, and I think the justification was that that was more or less the going rate for the type of skills that were required for that role if those people were having the open market. And so that was, that was that. Um, so it would’ve been great to be getting, you know, almost twice as much as I was getting, but I was really grateful to be getting so much more than my PhD that it seemed like, you know what, again, just kind of focusing on myself, not letting myself worry about that. Um, and I think that my, my, uh, postdoc mentor advocated kind of on my behalf, but was essentially kinda shot down. I was like, no, we’re, that salary could not apply to me for what I was doing. Um, so no, um, no, ill feelings towards that. It’s more the issues, the larger system than my individual situation.

Emily (06:19): Yeah, I totally understand that. And people do make different amounts of money That’s true in different fields. They’re paid differently. Um, it just strikes me that like you were, they had you anchored at that grad student stipend level that unchanging grad student stipend level, so that yeah, when you double your compensation, like you feel great about it. Um, and I understand, you know, you, you were trying to, again, keep your eyes on your own paper, but like yeah, that does sting to have another person who had the same ti- kind of title as you, right. With such huge disparity. Okay. How many years were you in your postdoc and what was the financial transition, if any, that you were able to make during that period of time?

Tenure Track Faculty Salaries at R1 Institutions: $63,000 to $100,000+

Dillon (07:02): Yeah, I started my postdoc, um, in 2022, and then I, um, was applying for jobs fairly quickly, faster than I, um, anticipated with in 2023. Um, and that was because I’d had some, um, department search chairs that specifically reached out and said, Hey, you should apply for this. And I didn’t really quite feel ready for that, but I was like, okay, I mean, if you’re telling me, I guess I’ll at least put my name in the hat. Um, and once I had done like two or three applications, um, it was relatively trivial to just apply for, you know, seven or eight more. Um, and so I had a couple of on-campus interviews. Um, they were all places that I was at least interested in perhaps working at. Um, but one of the offers was for I think initially like $63,000 a year. And this is, uh, uh, an R1 school in the southeast.

Dillon (08:14): And I was, my jaw dropped. I was like, are you kidding me? Like that is, that’s really, really crazy. Um, I had a competing offer from another R1in the southeast, um, for I think 74. And I went back to the first school and said, Hey, you know, are you willing to match it? And they were sort of like, we can go up to 72, but we, we can’t match it. So I said, okay, that’s, that’s not gonna work for me. Um, for the other school that was at 74, um, I still felt like that was way low and I had a lot of debate because I’m like, well, look, this is a tenure track position at an R1 school. I felt like I could have success there. It would be limiting in what type of research I could pursue, but I felt like the bar was such that I could clear it and be a success.

Dillon (09:14): And so that, that gave me a, a big reason to pause. Um, at the same point in time, I did an on-campus interview for another R1 in the southeast that I knew would be over a hundred thousand per year. And so I was like, okay, that would also be a better place for me to do my research. Um, and I just feel like that would be the best fit. Um, it was a really weird situation where after I had my on-campus interview, I followed up and, you know, wanted to ask where they were in their search process and heard nothing and reached out again saying, Hey, I have other offers. Just wanted to know where you’re at again, nothing. So, um, I was pressured from the other school to say, Hey, like, are you gonna take this or not? And I basically just said, no.

Dillon (10:12): I said, you know, I am still waiting to hear back. And I just felt that 74,000 was, was very low. Um, still ended up being ghosted by the third place. Um, did not have a rejection email, not, and automated one, not anything else. It was just radio silence. So, um, that was really weird. Um, and I reached out to other professors at Vanderbilt. Uh, they were more senior to just be like, Hey, like, this seems odd, is this normal? And they were like, no, that’s not, but they, you know, kind of did their best to assure me that it was unlikely directly related to something inherent to me and more that they didn’t have their kind of department in order. And this is a reflection of that, and that if that is the way that things are going, then maybe that’s not a great spot to come in as an assistant professor.

Dillon (11:14): Um, so I ended up sort of doing a lot of interviews and getting very close, but kind of walked away from things and felt a little, um, unnerved by it all. I was like, okay, I, I had this position that would’ve been okay, really didn’t pay that well. I said, no, should I have accepted it? And then this other place that just didn’t even get back to me. Um, so then the following, uh, year, uh, I came back and did I think one or two apps kind of early and then did an on-campus interview, um, a little bit earlier in the season and was offered that and decided to take it, um, at Florida State. And I didn’t know it at the time, but the, um, o- offer was for $88,000 per year, um, on a nine month, um, contra- or salary or however that’s, that’s phrased.

Dillon (12:17): Um, and I was told that the starting salary was not negotiable for essentially like, uh, it’s set by the union. And I was a little bit surprised by that because I know that a lot of, a lot of state schools have faculty unions, but I didn’t quite understand how that played such, um, a large role in the salary negotiate sal- salary negotiation, because I really felt that that was like the most common negotiation point that you could have.

Deciding on a Tenure Track Faculty Position

Dillon (12:54): And so I was just sort of like, oh, that’s, that’s it. Um, okay, well, um, I guess this is my next big choice is do I take this or, or not. And I felt that Florida State was a place that I could, um, have success, have support. Um, I was in a good peer group. Um, it felt like things are gonna start getting very sticky very quickly with higher ed, and so it felt like I really should not wait on this, and this seems like a good spot. And so, um, that’s kind of how that all, all of that unfolded.

Emily (13:33): I’m trying to get to the timeline. We’re talking about fall 2024. Is that when you were extended the offer? Is that right?

Dillon (13:40): So I would’ve interviewed in December of 2024, and then I received an offer in, I think it was January of 2025.

Emily (13:48): Yeah. Sticky. Yeah, that’s a good way to put it. Sure. <laugh> uh, prescient. Good job. <laugh> securing something at that stage

Dillon (13:57): And kind of just layered on top of that. I was very sick for my interview week, week weekend. Um, I had a conference right beforehand and I had started to get sick and I was like, oh, all right. Maybe if I just take like one or two, like two days of rest where I am just trying to sleep and take meds, I’ll kind of get through it. Um, ended up getting worse and I had a fever, I was coughing consistently, I couldn’t sleep. I had lost my voice and I was like, I can’t call the day before I’m supposed to leave, or the day of I’m supposed to leave and just cancel this. Um, and so I was like, well, maybe by the time I get there I’ll be over the hump and I’ll be recovered. And so it was magical thinking. Um, and no, I was very sick.

Dillon (14:52): I went through like literally a bag of cough drops per day. Um, I had to have water with me the whole time near the end of my job talk, you know, I had this coughing spell that I had to take like a minute or two and a minute. A minute or two doesn’t sound like a long time, but when you’re coughing for a minute or two straight, um, it was, it was probably the toughest like academic thing that I’ve ever had to do, um, is you’re supposed to be on the whole time you’re supposed to be at, at your best and you’re conversational and answering these personal questions and research questions. And, um, I just got through it all and just said, okay, I guess this is, this is what I have to do. Um, I try to take this mindset that I’m like, imagine you’re like special forces in the military. There’s no option to not do it. You’re just gonna do it. And it ended up that it worked out.

Emily (15:53): What I’m actually taking from that story of, you know, these two rounds of applications and your interview process and all that is like, um, that you kind of had, I don’t know if I wanna say it’s an abundance mindset, but at least like not a scarcity mindset. Like you really talked yourself through, you know, declining the offers that you had because you were kind of like, they aren’t sufficient, it’s not gonna be a good fit. And I think a lot of people would say, I have a bird in hand, right? Like, I have it, I have to take the offer because these tenure track positions are so hard to come by. Um, yet you held out even, you know, it didn’t work out the first year, but working out the second year, despite the adversity and the interview and all of that, just like, yeah, you had a, a standard that you, um, held the job that you wanted to accept too. And so I just want people to get that message of like, it’s not all scarcity. Okay. I know there’s scarcity in academia, but not always, not for everyone. Um, there can be times when these things work out.

Dillon (16:58): Yeah. And you know, I’m very grateful that it didn’t work out because, you know, this is such a tough place to be, you know? And so, um, it’s tough to explain that to your family or your parents because they’re like, oh, okay, well you’re doing a PhD, so that means you’re gonna be a professor. And it’s like, well, first of all, it’s if you want to do it, and there’s a whole range of places and spaces that you can go with that, but also it is not any kind of guarantee. And like if, if you’re in your PhD, you, you, you kind of know that, but to explain to your parents that are like, I don’t know, um, as, as much as they love you and as much as they think you’re great, you can be really great and it can still be really, really tough. And so, um, that’s why I felt such anxiety from having said no to these places because I’m like, am I gonna be kicking myself, you know, a year or three down the road when I’m like, if I just had done that? Um, and so it, it did work out and I’m grateful for it.

Emily (18:05): I think you also, and maybe this is true, but you should have been taking some clues from okay, I was invited to apply like only a year into my postdoc. Like maybe I have a strong profile, like maybe I’m a competitive candidate here. Even though it didn’t work out in year one, it did, you know, subsequently. Um, the other thing about the parents, I think, or maybe outside people, like having that expectation of like, oh yeah, PhD means professors. Like when you actually like grab that ring and you’re like, I got it <laugh>, I’m accepting an offer. They’re like, of course, of course that’s what was going to happen. You’re like, no, you have no idea. Like what I went through to get to this point. <laugh>.

Dillon (18:41): Yeah, exactly. Exactly.

Emily (18:43): Okay. Well, is there anything that you’d like to share with us about your current position and the financial aspects of it? I mean, I kind of think you left a little open loop there with like, does the union actually determine faculty salaries? Like what have you discovered in your time since you accepted or since you started?

Dillon (18:59): Um, it’s still an open question. Um, so I know that that is not university wide. Um, it might have been that there was a specific pay line that was given to the school from the college that either there was a maximum or just a set amount. And that was just that. Um, there’s also some very interesting, uh, issues where I have a startup, but I cannot use my startup to pay students or to pay staff. And that’s kind of wild in the basic science space because like when you are just starting your lab, you, you get postdocs, you get, uh, research staff you like, that’s how you build up your lab and you do the work that you need to do. Um, and so it’s just a little bit odd that, um, that’s the restriction that, you know, I’m, I’m working through. Um, so

Emily (20:05): My understanding that until you get a grant, you can’t hire anyone. Is that right?

Dillon (20:10): Essentially. Yeah. Um, there are undergraduate and masters students who, um, can do sort of like, uh, i, I don’t know the exact term, but sort of like a, a research experience where they can work in your lab for a certain number of hours per week. Um, that’s not guaranteed. You have to, you know, there’s only so many students that that that can go around. Um, I’ve also learned that for as much as I have, you know, kind of complained about my PhD experience, um, it is a lot bleaker in other places. And so, um, you know, even with my department now, I’m like, oh, I don’t know that I would bring in a student unless I had a grant because there are so many issues. Um, they kind of, they extend in in multiple ways. Um, yeah, I want elaborate on, on, on that more, but, um, you know, I’m having to kind of transition from thinking about, okay, what were my experiences to now? What would I want, um, a student to experience as, as my student

Emily (21:29): That’s very positive. <laugh> in terms of an outcome of your experience to yeah, be thinking about it. ‘Cause you know, with some, again, I mentioned distance earlier, the distance of time, some people do forget or start to romanticize, um, their own financial experiences during graduate school, um, when it benefits them to do so in terms of who are they gonna hire and how much are they gonna pay them and are they gonna negotiate and all these things. So I appreciate that, you know, you’re still close to the experience, but that you’re taking that mindset and saying, okay, maybe better not to hire anyone under these circumstances until I can provide for them in a way that you think is fair and sufficient to, you know, further their development. Of course, the research that you want them to do for your lab.

Dillon (22:11): Yeah, I think that communication sciences and disorders is a very interesting field because it can be situated in a lot of different places within a university. It can be in the College of Arts and Sciences, it can be in a college of education, uh, at Vanderbilt it was kind of, uh, part of the medical program and biomedical sciences. Um, and so each of those different placements kind of impacts the expectations and the ability for your students to get funded in ways that I think would be appropriate.

Emily (22:48): Yeah. So it’s definitely something to consider when you’re doing interdisciplinary work. Right.

Commercial

Emily (22:56): Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, frugality, increasing income, or student loans, each tailored specifically for graduate students and postdocs? I offer seminars and workshops on these topics and more in a variety of formats. This is a perfect time to book me for a workshop at the end of the current fiscal year or at the beginning of the upcoming academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, or postdoc office? My seminars are usually slated as professional development or personal wellness. Ask the potential host to go to PFforPhDs.com/financial-education/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

Financial Challenges as a Tenure Track Faculty Member

Emily (24:21): Okay. Give us a picture of your finances. Now we know your salary. Where is it taking you? What are you doing in your financial life now that you have this position?

Dillon (24:32): Yeah. Um, it still feels very unsettled, um, because I just moved in August, um, I moved from the condo that I lived in Nashville to a house that I’m renting with my wife. Um, there were a lot of expenses with the move. Um, Florida State provided a sign-on bonus, but not, but that was, uh, it, it was, it took several, uh, weeks for that to be dispersed. So I had to put a lot of moving expenses on a credit card. Um, it took a while for our condo to sell, and so there was a short period of time where we were doing a mortgage plus rent, um, which was really tough. And then my wife, um, had to move jobs and so there was, um, you know, about four weeks where she wasn’t working. She’s just now working towards her first, uh, full paycheck. And so the, the coffers have have kind of been, been drained.

Dillon (25:37): And so, um, I feel like, you know, give it another six months and we might be in a better place, but it still feels very kind of unsettled. Um, and so even though I’ve, you know, gotten a, a pay raise, it really doesn’t feel like it, it almost feels like, um, like a step backwards as far as, um, just the amount of money that’s, that’s been laid out. Um, additionally, I am, um, paid for nine month salary, um, which previously was 12, right? And so, um, there’s a, uh, institutional grant that you can apply for that helps supplement your summer salary for your first year, but it doesn’t fully replace it. Um, and so I’m gonna have to just be basically saving money through the months in order to pay my own salary in the summer. Um, so that feels a little, a little scary.

Dillon (26:43): Um, hopefully, you know, I can supplement that with grants down the road, but that’s gonna take, you know, at at least a year or more to, to do. So, um, I am hoping to, um, buy a house in like May or June, so that will be another kind of like big major purchase. Um, and a again, a lot of money associated with, with that. So, um, and I’m ba- what I’ve, what I did is I kind of put the money from the condo into a, uh, like money market account. Um, and so I, I can’t and won’t touch that up until that point. Um, and so, um, yeah, it, it, it’s, it’s good to be starting fresh, but also there’s some aspects of it that, um, just take a while to sort out.

Emily (27:39): I’m really glad to have this message on the podcast as well of like a higher salary is not a panacea. Like, it’s, it’s helpful, definitely better than not being paid as much, but like, as you progress in your life and your career and your finances, also kind of the stakes get raised. Like we’re talking about home ownership, right? So like selling a condo and like buying a house. So like we’re trying to do an upgrade here, you know? Um, and so the expenses get raised too, and things like moving, uh, interruptions in pay because of career transitions, like all these things are normal things that happen. So it’s like, yeah, you have the higher salary, but like you said, it doesn’t quite feel much easier yet. And hopefully once you know, things settle down from the transition, the moves and all that, like, hopefully you will start to feel better about it.

Emily (28:26): But like, yeah, it can take some time for sure. Um, so it’s not an immediate fix necessarily. The postdoc salary probably felt better, right? ’cause you didn’t move, you probably didn’t have an interruption, um, in your paychecks or anything. And so it was just like, oh, immediately there’s more money. That’s great, right? But when you factor in these other things that happen at these different career stages would involve moving different cost of living different places. Yeah, it can, yeah, challenging, but I’m very hopeful for you and your wife and your future and these changes that you’re going to make and yeah, that you’ll figure out <laugh> the summer salary and the grants and subsequent years, and maybe this year will be the hardest year, right? Financially getting all this stuff sorted out. Um, is there anything else that you’d like to share about this stage and your finances or money mindset during this stage?

Dillon (29:12): I don’t think so. I think that, um, I kind of came into both my PhD and my faculty job with reasonable expectations, and I’m really grateful for getting to pursue this, you know, line of research that is meaningful to me that I feel like I’m making an im- an impact. Um, there’s certainly days or times that I’m like, man, I have so many interests and I chose this really niche thing that not a lot of people can relate to. Um, and that feels, you know, tough. But then there are times when I feel like, man, if I’m not doing this, I don’t know who else would be, or, um, I can help someone down the road that, um, if I wasn’t doing it, um, I’m not sure we would have that, that knowledge. Um, so even, even throughout my PhD, I had a roommate who was like, oh, you should, you should, you know, just go and work for Google and like their speech sciences that does voice recognition stuff and you’ll get paid way more and you’ll have a better life and blah, blah, blah.

Dillon (30:30): And, uh, I was kind of offended by that. I was like, yes, I probably could do that, but that would completely abandon this, you know, sort of dream and this motivation that made me do this in the first place. You know, I wasn’t working towards just a degree because it sounded cool, or that was just the next logical step. Like this was something that I literally planned out from my freshman year in college. Um, and so it was sort of like, you know, pursue that or go out in flames trying. Um, and I think that because my motivation was so personal, it made it easier to push through some of the hard times where, um, people that maybe lacked that a little bit, you start to look around because you’re like, well, what’s, what’s the why? And I think that that is important. It’s no wrong or right answer, but I think it, you’re going to be in situations where you confront that to varying de- degrees and, um, I’m just glad that, you know, mine has, has worked out the way that, that it has.

Emily (31:37): People are allowed to make different decisions around this, right? Like, yeah, you have this personal motivation, as you said, you’ve had a long-term plan, you’ve been executing, and this is at least the first stage of the culmination of that. Um, and certainly try it out. And if you decide it’s not all that it’s cracked up to be, then you can make a pivot at some other point. That’s totally fine. Um, yeah, but I, I’m also struck by like mission-driven people also need to be paid well enough to sustain what they’re doing. So I hope that is the case for you now that you’re in this, um, this level of your career. Um, so Dillon, it’s been an absolute pleasure talking with you and hearing your story, and I think there’s so many great nuggets that listeners can have gotten from this interview depending on what stage they’re at.

Best Financial Advice for Another Early-Career PhD

Emily (32:23): Um, I wanna conclude with the question that I ask of all my guests, which is, what is your best financial advice for another early career PhD? And it can be something that we’ve touched on in the interview already, or it can be something completely new.

Dillon (32:35): I, I sometimes struggle with that because everybody’s different and what worked for me isn’t necessarily gonna work for everybody else. Um, but something that I got in the habit of that was a huge help was just tracking my spending and knowing, learning to know exactly what I could afford. Um, and that allowed me to make some choices that were trade offs, but at least I, I sort of knew the dollar amounts and how that would impact me. So, um, yeah, I, I think that because I was on this fixed amount for so long, I had kinda my core expenses that were paid for or that I could pay for, and then it was sort of, how do I play with the margins of that and what’s that going to go towards? Um, my, my wife went to law school and took out a lot of loans and she had a very different experience where she had such massive loans that she was like, oh, what’s a hundred dollars here or a hundred dollars there, it doesn’t really matter.

Dillon (33:45): And so she didn’t have that sort of fear of God into tracking her spending because she didn’t really have to. Um, but if you don’t do that in your PhD, you can kind of quickly accumulate things that will hurt you down the road. Um, so it’s not fun, but I could kind of, after a few years, I could kind of be like, oh, alright, I have approximately, you know, $400 to appropriate this month. Where’s that gonna go and how am I gonna do it? Um, and if I know there’s something, you know, five months down the road that I’m gonna do, I can try to segment as little as I could to put towards that. Um, controversial take here is that I feel like I leveraged credit cards very well. Um, I was not a crazy points guy, but I definitely took advantage of a lot of, um, signup offers.

Dillon (34:49): I was very good about paying off my credit cards, um, for the, for the most part unless there was like a 0% APR card that I basically took out specifically for that reason. Um, and so that gave me a little bit more money. It gave me a little more flexibility, having a zero interest essentially loan. Um, and then that also did help build my credit through time. So I have a credit history that’s lengthy and positive and, you know, they’re fairly good amount of it. In fact, I was always shocked that these credit cards were granted to me for, you know, $10,000 and I’m like, I can barely afford my groceries at the end of the month and you’re just giving me 10 grand. Like, that’s crazy. But if you do it right, you can, you can make that work. Um, again, that was a super intentional and thoughtful process that I did, and you can have that go sideways really, really quickly. Um, so it’s not exactly advice for everyone, but if you can kind of thread the needle, there are good things that can come.

Emily (36:05): Well, I think the second, I don’t wanna call it advice, but the second suggestion or, you know, modeling what you did follows very well from the first you have to master and understand your own spending and develop some intuition around that before you go into, um, playing with fire a little bit, <laugh>, which is, you know, the, the credit card games and so forth you can play because the temptation with credit cards, you know, using plastic in general and then doubly, so if there’s like a benefit, you know, points or sign up bonuses or whatever, there really is a little pull there to spend more than you would if you were using other forms of payment. And so, but if you have that knowledge and intuition and the budget or whatever it is that you’re doing to kind of keep your spending in line and on track, then you can do that successfully, which it sounds like you did.

Emily (36:51): Um, so I’m very glad to hear that that worked out for you. The Points game is not, uh, controversial on this podcast, so it’s something that we’ve talked about with other graduate students and I do think it’s one of the ways that people can find a little bit more wiggle room in their spending, uh, when they’re living on a low stipend like you were. Um, so Dillon, again, it’s been such a pleasure to have you. Thank you for sharing all this, uh, with us, especially these sort of behind the scenes things and emotional things that were going on with you through these unpleasant, you know, sometimes unpleasant things that happened. Um, I just think it’s a really honest window into the graduate student experience, the PhD experience, so thank you so much for sharing it with us.

Dillon (37:28): Yeah, glad that I can share.

Outro

Emily (37:44): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by me and show notes creation by Dr. Jill Hoffman.