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The Financial Upside to Leaving Academia

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In this episode, Emily interviews Dr. Chris Caterine, the author of Leaving Academia: A Practical Guide. Chris holds a PhD in classics and worked as a visiting assistant professor before transitioning into a career in the private sector. Leaving Academia addresses the necessary identity shift and practical steps that accompany this process and grew out of the informational interviews Chris conducted. Emily and Chris discuss the financial pressures that motivated Chris to shift to a non-academic career and how to financially prepare for that change. They also discuss the role side hustles and volunteer experiences can play in helping you land a non-academic job. This episode is a must-listen for anyone currently in PhD training or working in academia!

Links Mentioned in the Episode

financial upside to leaving academia

Teaser

00:00 Chris: And when I really stared down that fact it became very, very hard for me to cling to this idea that it’s okay to accept a certain degree of poverty or lack of wealth in being an academic. And to really say, you know what, like actually, I want to have some nice things and I’m not sure I’m willing to be ashamed of that anymore.

Introduction

00:27 Emily: Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. I’m your host, Dr. Emily Roberts. This is Season 10, Episode 7, and today my guest is Dr. Chris Caterine, the author of Leaving Academia: A Practical Guide, which was published one year ago. Chris holds a PhD in classics and worked as a visiting assistant professor before transitioning into a career in the private sector. Leaving Academia addresses the necessary identity shift and practical steps that accompany this process and grew out of the informational interviews Chris conducted. Chris and I discuss the financial pressures that motivated Chris to shift to a non-academic career and how to financially prepare for that challenge. We also discuss the role side hustles and volunteer experiences can play in helping you land a non-academic job. This episode is a must-listen for anyone currently in PhD training or working in academia!

01:29 Emily: Did you know that I run a couple of database websites for collecting stipend and salary information for PhD trainees? The domains are PhD Stipends dot com and Postdoc Salaries dot com. If you haven’t done it yet, would you please take a minute to: 1. Fill out the survey to report your 2021-2022 stipend or salary to the appropriate website? The databases consist of crowd-sourced information, so they rely on the willingness of PhD trainees like you to self-report their income. 2. Share the site with your peers over a social network, a listserv, or a forum website? These websites are super useful for prospective PhD students and postdocs, but they are also often used for advocacy efforts to bolster the case for raising stipends and salaries. Thank you so much for participating in these efforts! Without further ado, here’s my interview with Dr. Chris Caterine.

Will You Please Introduce Yourself Further?

02:32 Emily: I am delighted to have joining me on the podcast today, Dr. Chris Caterine. He is the author of the new book, Leaving Academia: A Practical Guide, and I’m super delighted to have him on because we’re going to be talking about career changes, graduate students, and PhDs and academics who are leaving academia and how personal finance relates to that process. So I’m super excited. Chris, will you please introduce yourself a little bit further for the audience?

02:56 Chris: Of course. Thank you so much for having me, Emily. Again, I’m Chris Caterine, I’m a communication strategist and proposal writer for a global consulting firm. My academic career was actually in classics, which is Greek and Roman literature history and all that stuff. I got my PhD in 2014 from the University of Virginia. And as Emily said, last year I had a book published called Leaving Academia: A Practical Guide with Princeton University Press.

03:20 Emily: Fabulous. And in the book, it talks a lot about your own journey, as well as what you learned from others. And there were lots and lots of interviews which went into the book, which was fascinating. Can you just tell us like quick synopsis, what’s the book about, what do you want the reader to do with it?

03:34 Chris: The book is really designed to do two things. The first thing is that I’ll go to the practical side, which is to say, if you are in academia and you realize that you don’t have a career, a future in academia, which, you know, 93% of entering social sciences and humanities graduate students don’t, then the book gives you practical steps, just put one foot in front of the other and figure out what you need to do to find a new career. Even if you have no idea what that’s going to be. And that practical side of the book again, is good for everybody, not just humanities and social sciences, but STEM folks as well. The other side of the book is almost more psychological or identity-driven. And that’s really trying to get into the mindset of people who can’t imagine having any career besides a professorship. And what sort of, how do you approach what is ultimately an identity crisis, not just knowing what you will do, but not knowing who you will be if you leave the academy. I think those tend to drive more towards the humanities and social sciences side because there’s always been more industry outs for people in STEM. But really it applies to anybody who views academia as vocation and feels called into that line of work and realized since then, that might not be their future.

04:50 Emily: I love the way you described that. And I also loved, I don’t remember if it’s the introduction or something, but you sort of positioned what your book adds to the field already, because I don’t know if I read some of the exact same books you’re referencing, but I read the kind of book that you’re referencing, which is like a lot of like personal essays or like individual stories around careers that people have after they, you know, get out of graduate school or finish their PhD. And that’s wonderful to see examples of what’s going on, but your book is more about, okay, what is the actual like logistically, like, what is the process here? Like what do I actually do to get to that end point that I see as possible? And I really appreciated that. And of course I love, and I’m sure everybody loves that these six chapters have alliteration for all the titles to them.

Motivation for Leaving Academia

05:32 Emily: So there’s, I’ll just read them out because I have the book here. Dread, discern, discover, decipher, develop, and deploy. And I actually found I thought my favorite parts of it were actually in decipher when you were talking about, I don’t know if you use this term, but the translatable skills that you develop in academia and how they actually relate to other jobs you could do later. And I know I’d always heard that in graduate school, you have translatable skills, you can use them later, but like your explanation was just more detailed than anything I’d read before, which I found really delightful, it made me feel a little bit better about the things that I learned while I was in academia. So thank you for that. So, delightful book, and as I said it’s, it was driven by all these informational interviews that you did. And you did more in-depth interviews for the book. But I wanted to know about sort of your motivation for leaving academia. And it’s apparent from the book that finance has played at least some role in that. So would you please elaborate on that?

06:32 Chris: Yeah, really, for me, I think I began accepting that I was going to be leaving academia around age 30. It sounds a little bit cliché, but it was a big transition point, even if I didn’t want to admit it. And I was getting to that stage of life where you know, my wife and I had been married for a few years. We were thinking that we probably wanted to start a family at some point. I just remember looking at all of these jobs I was applying to, you know, I was making $40,000 a year teaching a 3/3 as a visiting assistant professor. And I was applying for jobs like that, that were apart from my wife and I was saying, well, first of all, how do we have kids if we’re living apart, that’s really work. But also like just doing the math and the salary and trying to think, okay, if we’re trying to live in two places, that’s two households, 40, 50, even $60,000 a year like this, just like the math doesn’t work.

07:22 Chris: And on top of that, even if we lived in the same place somehow, you know, solved the two-body problem, because my wife is also an academic, or still is an academic. Even if we solve that, I looked at it and said, you know, I don’t know that my wife and I would be able to give any child or children in the future, anything resembling the quality of life that our parents gave us. And when I really stared down that fact, it became very, very hard for me to cling to this idea that it’s okay to accept a certain degree of poverty or lack of wealth in being an academic. And to really say, you know what, like brass tacks, actually, I want to have some nice things, and I’m not sure I’m willing to be ashamed of that anymore.

08:07 Emily: So interesting. I mean, really what you’re talking about here is a realization of your own values as you grew, you know, towards age 30 and so forth, and realizing that the career, which is one of your values, I’m sure that aligned in some way with your values was in conflict with these other values of what is the standard of living that I want? What is the kind of family that I want? And you resolved, I assume, this conflict by having a career outside of academia that still, again I’m assuming, fulfills many of your values and so forth, but this book is about the process of finding that and landing that career. I’m just wondering, because we’ve heard the story before, a similar story before on the podcast. I’ll refer listeners to the episode with Dr. Scott Kennedy, who similar to you, came into academia, aspiring to the professoriate.

Financial Framework in Grad School

08:51 Emily: And during graduate school got married and actually had, I think, two or three children during graduate school, and realized that it was just not tenable financially and exited academia and found fulfillment elsewhere. So that was a wonderful example, but I want to know. Okay. You just mentioned, you know, as a visiting assistant professor, the $40K salary. Did you know, like back when you were in graduate school, that that was your financial future, if you stayed in academia? Or did you have like a rosier picture? Like what did you think was going to happen?

09:18 Chris: Well, in grad school, I was living on an $18,000 a year stipend. So I figured anything more than that would make me rich. I mean, I literally just thought it’s double the buying power and of course that isn’t actually the case, you know, taxes increase. If you’re living with a partner, like maybe you have two incomes, but you need more space for the two of you. The costs do not kind of move up in a linear way. And so I sort of expected that as my salary went up, you know, in a linear way that the costs would track and they just don’t actually in a lot of ways. And so, I really worked hard to live on that, that $18K a year. You know, it’s funny, I was looking at my pandemic hair, which is getting all too long in the back and I was like, man it hasn’t been this long since graduate school.

10:03 Chris: And I’m like, oh yeah. Like I got one haircut a fiscal quarter for $12 at a place, you know, a 20-minute drive away because I wanted to not put money into that and save it for drinks out, whatever it was. And so I think I just assumed that like my spending was so low that anything that I brought in would let me do infinitely more. And part of that was I was living in a low cost area. And part of that was, I just didn’t understand how those costs scaled, and part of it was that, you know, at age 22 the prospect of kids was a long way off. And then you start thinking about it, you say, oh, I have 18 years to save, you know, $350,000 for college. That’s that’s not going to work right on $40 a year. The math just doesn’t track. So yeah, I think my thinking definitely changed later on. But in graduate school I just assumed that it would be okay.

Financial Strain as a Common Motivator

11:03 Emily: And I think that, you know, you said earlier, oh, it’s cliché approaching my 30th birthday, I had all these, you know, realizations or whatever. But I think that your story, again, is common that as we age, we realize that we want a higher standard of living than what we were enduring during graduate school. And the other thing, you mention this, I think, somewhere in your book that during graduate school, I don’t believe that you were contributing to your retirement. That was something you were able to do only once you had your full-time job and so forth. And so there’s also this like sort of deferred cost, like you’re pushing off responsibility to the future for yourself. And so, yeah, maybe $40K is not actually double $18 K because you have XYZ taxes and retirement and all these other things. Maybe a house, maybe a family, all these other things you want to do. So I totally understand. And it’s the same, you know, experience that I have as well. Do you find that financial strain in academia is a common motivator for leaving academia for other people?

11:59 Chris: Yeah. A lot of people that I’ve spoken with do raise that issue. And I would say that the stories vary a lot. These are some people who say I have a ton of debt, I have nothing in savings. And you know, I’m done with graduate school in three months. Can you help me. And that’s a big ask. You know, I can give advice. I can tell you maybe how to prioritize that three months that you have, but that’s a challenging situation. For other people they see it a little bit earlier on, and maybe they realize that things won’t work out financially, for other people, especially in the U.S., healthcare becomes an issue as well. I would say that that is a big motivating factor for a lot of people. And I think as you do get closer to completing, and as you start applying for jobs and thinking about you know, incurring the cost to move for a jobs that pays you $30,000 like that’s going to cost you a few thousand anyway, you’re kind of burning negative on that deal.

13:06 Chris: I think when people start actually thinking about that or trying it out a few times and seeing how it works out, yeah, the finances do become a big issue. And especially looking at salaries outside of the academy, it’s just wild. I mean, I felt rich when I went from my $18,000 to $40,000 as a visiting assistant professor. And I didn’t realize just how small a salary that was until I began looking outside.

Personal Finance Strain on Contingent Faculty

13:36 Emily: Yeah, my husband’s also PhD and he and I went through a similar thing going from like graduate student to postdoc salary, but then realizing, oh, wait, we’re paying FICA now. Okay. It doesn’t go that far. So I’m actually wondering, so, you know, you mentioned near the start of the interview that only maybe 7% ish of people who start a PhD program will actually end up in a tenure-track job. And I think one of the issues that maybe is not discussed head-on, but certainly indirectly in your book is the problem of contingent faculty, right? So if you get the tenure-track job, then maybe you are on a decent salary path. I mean, I don’t know about your field necessarily, but I have certainly run across many citations of professors making over $100K a year and even $150K or more, but that’s not at the contingent level, the visiting level, the adjunct level. Can you talk a little bit about sort of the strain on the personal finances of contingent faculty, as they’re maybe holding out hope of this, you know this ultimate dream job?

14:38 Chris: Oh, this one really breaks my heart. And one of the things that actually precipitated my move outside of academia was working on contingent faculty issues for my professional society. So that was the first time I really started to look at what life could be like. And when you start hearing figures that something like, it’s like 54% of adjuncts qualify for food stamps you know, like I can’t remember all the statistics off the top of my head now, but I mean, the numbers are really bleak, and you start realizing like, oh my God, this is severe. And as a society, we’re essentially subsidizing these universities that don’t pay people. Like, what, why do we do this? Why do we put up for it? I think the thing that really crushes me so much now, when I talk to people in contingent roles who say, well, you know, I want to try one or two more times is that, you know, they are missing out on the opportunity cost of the situation as well.

15:42 Chris: And it’s like, well, yeah, okay. You can try to get an academic job one or two more times, and maybe you have a, you know, three to 5% chance of getting one, but all the time that you spend on those applications, all the money you spent flying to the conference interview for the job, whatever it is, all of that time and money could be put into other things that could be preparing you for a career that actually makes you happier than being an academic and gets you out from under the thumb of the system that is fundamentally broken. And convincing people that if they’ve bought into the idea that their identity is tied up in being a professor is very, very hard. And there’s sort of only so much that you can do to get people to move past that. And I hope, you know, the early chapters of my book, “Dread,” I give this dire name, title, because I’m trying to shake that sense into some people who maybe are resistant to it. But really, you know, for some people, it is just a matter of coming up and seeing what that’s like. But I would encourage all your listeners to really go out and read some stories of what contingent life is actually like financially. It’s not a good situation.

Commercial

16:53 Emily: Emily here for a brief interlude. If you are a fan of this podcast, I invite you to check out the Personal Finance for PhDs Community at PFforPhDs.community. The community is for PhDs and people pursuing PhDs who want to take charge of their personal finances by opening and funding an IRA, starting to budget, aggressively paying off debt, financially navigating a life or career transition, maximizing the income from a side hustle, preparing an accurate tax return, and much more. Inside the community, you’ll have access to a library of financial education products, including my recent set of Wealthy PhD Workshops. There is also a discussion forum, monthly live calls with me, and progress journaling for financial goals. Our next live discussion and Q&A call is on Wednesday, September 22nd, 2021. Basically, the community exists to help you reach your financial goals, whatever they are. Go to pfforphds.community to find out more. I can’t wait to help propel you to financial success! Now, back to the interview.

Changing Money Mindsets

18:06 Emily: Chris, I know we could stay on the subject for quite a while, and I wish we could, but let’s talk a little bit more about money mindset, specifically for you. So, you know, what was your attitude towards money, practice of personal finance when you were in graduate school, versus did it change later on as you became a visiting assistant professor, as you moved into your non-academic job?

18:26 Chris: So growing up, both my parents were trained as CPAs. I had like a pretty decent financial literacy growing up in that, you know, I knew how to balance a checkbook. I knew how to make at least a basic budget and make sure that there was more money coming in and going out and use that to sort of set my discretionary spending accordingly. So I’d been doing that sort of all the way through graduate school and had adapted pretty well to a very modest standard of living. And I was proud of doing it, and I still am that I did it, but, you know, as time went on, I think, especially with my move to New Orleans. You know, I grew up in Boston, went to school in Virginia. When I ended up in new Orleans, I saw a very different mode of life and people here definitely embrace the better things in life.

19:14 Chris: There’s good music, good food, good drink. And I started saying, wait a minute, like, why am I deferring all of that like a hundred percent? And so my wife and I had made a choice to live in a smaller apartment so that we could afford to dine out in New Orleans thinking we’d only be here for one year. Well, eight years later, here we are. So you know, geography sort of changed my outlook on what I actually wanted to be doing with my money. Not just squirreling it away in the bank, but using it to enjoy life. And I think I also ended up going from being extremely risk averse in graduate school. Just because there wasn’t that much, so if I lost any of it I felt it more, to over time just becoming a little bit more comfortable with risk.

20:01 Chris: And for me, leaving academia was actually a process of embracing risk and embracing financial risk in a way that I hadn’t before. So I had one year left on my visiting assistant professor contract and my wife and I had decided that we wanted to stay in New Orleans no matter what. And we decided to buy a house. And I was terrified of that decision, because we could afford the monthly payments for the next year, but I had no idea what was coming after. I hadn’t really built a good network. I didn’t have good leads on jobs. It was a big question mark, and I actually used that life event to sort of put my back against a wall and say like, if there’s the prospect of losing this house if I don’t figure something out, then I better figure something out. And that was a huge motivator to me. Again I was in a privileged position to be able to do that, but that was sort of the rationale was using sort of a financial tool to push me into a space where I was uncomfortable.

21:09 Emily: I think I’ve heard this referred to as like a commitment device. Like there’s going to be some real big downside if I do not follow through on my goal of X, Y, Z. I’ve heard it in a lower stakes situation than home ownership, but I think this qualifies as well. And, you know, I think what you said earlier about the opportunity cost of that particular example, the opportunity costs of staying in a contingent faculty position, doing 1, 2, 3 more cycles on the job market. There’s also a major opportunity cost to graduate school. There’s also a major opportunity cost at staying at these lower salary levels. So you said, you know, I had to think about risk in a different way. I had to be willing to take on more risk. There was implicit risk in what you were already doing, but it probably wasn’t forefront in your mind, right? Like the risk of spending years and years and years pursuing this career that was not working out financially, was never going to work out financially. But it’s so hard to see that. It’s hard to see graduate school as opportunity cost.

22:11 Chris: It is. And I think the biggest challenge with the PhD right now is really that if you want to be a professor, it is a credential that you need to get. So if you want to keep the professorship open as a possibility for your future, that is the only path you have to do it. And yet, the vast, vast majority of people who get a PhD, can’t become professors. And I think because of that tension, people do get sucked into this mentality that you just need to forge ahead. And anything that you do that deviates from your scholarship or your teaching is ultimately going to be lessening your odds of that thing that you’re working towards. So it feels like a risk-averse position to be overly narrow, when actually it’s not.

Preparing Finances for Leaving Academia

23:00 Emily: Very well phrased. You mentioned earlier an example of, you know, someone coming to you for advice who has three months until they’re not being paid anymore and they have a lot of debt and so forth. And you’re saying, oh, it’s a short timeframe. We can do something here, but let’s say that, you know, some listeners have a longer timeframe, a year or more before they’re thinking about exiting academia. What can that person do to help prepare their finances for this process of leaving academia?

23:30 Chris: I would say, you know, save every penny that you can because at a certain point, you can actually buy time. And what I mean by that is that if you have, you know, three months of expenses in the bank, then even after your last paycheck hits, you will not necessarily need to take the first job that comes your way. And if you are making a major career change, you know, from a planned academic path to something totally different, it is likely that the first offer that you get is not going to be a job you want. And, you know, I cite these examples in the book, but I was interviewing for jobs to pour samples of beer at the grocery store. I was offered a job to sell life insurance, which seemed like a really good idea going through the interview process until I stopped to think about it and then said, wait a minute, like actually this whole thing, the financial arrangement that they put before me was a scam.

24:32 Chris: And I had, you know, friends and family fortunately say like, yes, we didn’t want to be discouraging, but that would be a bad idea. And because I had some savings in the bank because I had a partner with a stable income, you know, we’d looked at the numbers and said, okay, I can probably wait three to six months after that last paycheck. And then at that point I’ll need to shift my mindset into another, take anything that’s available or, you know, begin looking outside of New Orleans and consider potentially having to uproot. But the more you can save, the more flexibility you will have to make a sort of a positive choice at that end game, instead of being backed into something that you’re not totally happy with.

Benefits of Pursuing a Side Hustle for Skill-Building

25:16 Emily: I am in total agreement. And if someone were to follow this process in your book, it’s very deliberate and it takes a good amount of time, not just like the number of hours, but sort of longitudinally for you to be able to process and understand what’s going on and make the networking connections and so forth. It takes quite a bit of time. So to give yourself that runway, it’s the same thing with entrepreneurship, give yourself a runway before your paycheck ends, or, you know, if you can give yourself runway with savings, the more you can, the less of a desperate situation you will end up in eventually. And hopefully, as you said, you can make a positive career choice. And so I really enjoyed that you talked about in the chapter “Develop” how a side hustle can further this whole process. And I think in that chapter, you were specifically citing side hustles as a way for you to sort of add to your resume, add more experiences, demonstrate your skills, that sort of thing. But I think that side hustles could probably be helpful in multiple stages of this process of leaving academia. Can you talk about the benefits that you’ve seen of pursuing a side hustle?

26:18 Chris: For me, what I will say first of all, is that in graduate school, the only side hustle I had was tutoring, which was great because it got me some extra money, but it was also a really foolish thing to do because it didn’t get me anything besides that money. Like it didn’t actually make me a better teacher. It didn’t develop any new skills. It just sort of deepened my presence in a space that I was already in. So if you’re thinking of doing that and like, you just need a little bit of extra cash. Okay, fine. But again, think about opportunity cost. How could you spend that time? Could you get, you know, more than $15 or $20 an hour tutoring to do something else? You know, in that regard, I got lucky. I had a neighbor and a close friend who had a small business.

26:59 Chris: It was him and one other developer. And he just needed somebody to help with website development and like maintaining his books and like doing all this stuff that I had no idea how to do. And I knew him well enough that he said, well, I can pay you. I think he gave me 15 bucks an hour, and he said, “you know, I know that like me giving you $15 an hour to do it is going to free up time for me to bill my clients. And it’s going to let you learn some skills. And it’s probably, you’re going to figure it out faster than somebody I’d pay $35. So I’m good.” Now I got lucky with that situation, but it was great because I brought in a little bit of extra money, but I also began thinking about, okay, how do you sell a business service to a buyer who is probably resistant to incurring that expense in the first place?

27:50 Chris: Where do you go to advertise to small and mature businesses for kind of a small salesforce.com development group. So I began thinking in all these different ways, and it turned out that all that practice talking about technology services for maybe skeptical business audiences really paved the way for the stuff I’m doing now, where most of the time I’m working on proposals for big technology for the patient. I had no idea that would pan out, but that’s sort of how it did. So I think, you know, to get back the core of the question, how can side hustles really help? You don’t know how they could help. But I think you want to use them as a way to simultaneously build new skills and make some extra money. And if you let them do double duty, then that’s great.

28:47 Chris: My wife has a saying now which is like, she doesn’t do anything that doesn’t count twice. And if she can’t kind of apply it in two places, it’s not worth doing because the time investment is just too high. So I think that’s a really good attitude to take as you’re exploring new careers, as you’re trying to, you know, make extra money in graduate school or even beyond graduate school. You know, tutoring, you know, working in a restaurant, all that stuff can, yes, get you money, but is it going to be advancing those other career objectives that you have? If the answer is no, then you might want to think again about how to balance that equation.

Career-Advancing Side Hustles

29:24 Emily: Yeah, you’re absolutely speaking my language here. I have an interview with Dr. Gaius Augustus, which we’ll link in the show notes, where we talk through this framework that I have thinking about how valuable a side hustle will be to you. My favorite side hustle, I call career-advancing side hustles. Double-duty, as you said, it brings in money and also helps you demonstrate a skill, learn a new skill, have another line for your CV, expand your network, anything like that. And I think what was interesting about your example of, you know, keeping the books for your friend’s business is that you didn’t know how that experience was going to advance your career. And it turned out it did, in retrospect. And I think that just speaks to the benefit of like trying something new. And as you said, instead of staying in the same space that you already know tutoring, you know, it’s in your wheelhouse already, try to stretch yourself a little bit and it’ll spark new thoughts and it’ll spark new perspectives.

30:13 Emily: And so, yeah, just give some new things, a chance. And I noticed from that chapter of your book, it seemed like you were pursuing this side hustle, maybe, you know, some other volunteer experience and so forth over a fairly short period of time. And you got a lot out of it over just like a few months, six-month period or something. And so it doesn’t have to be like, oh, I have to set this up and do it the entire time I’m in graduate school. No, just try something. You know, see if you benefit from it. If it’s good pay and you do, keep doing it. Or if not, try something else. Just experiment with it.

30:40 Chris: Yeah. In software development, they have this concept of failing fast. And the idea is that it’s good to experiment and try little things. And like the sooner you find out something doesn’t work, the sooner you can stop spending time doing that thing. And so, I think that sort of agile and iterative approach to trying new stuff to build career skills is absolutely the right path.

31:01 Emily: I think the other benefit is that, you know, working for your friend’s business for a bit, it gave you some language probably that you didn’t have before. Not just the skills, but just that practice, as you said, of speaking with people you weren’t speaking with already inside academia and just that diversity of experience helped you, ultimately, you know, get the job that you have, because I know you said in the book that it took practice to change the kind of language that you use the kind of speech that you used from what you were used to in academia to what was acceptable in the business world, and that exposure can help a person, you know, along with that process.

31:33 Chris: Yeah. It’s maybe expected that a communications strategists would say that like career changes ultimately come down to communication. But in this case, I really do think that that’s the biggest challenge, is just that academics speak their own language, their own jargon. We have ways of interacting with people that are different from the world outside. And until you go out there and learn how other people speak and behave, the like trying to translate is a fool’s errand. It’d be like me trying to translate Latin into Mandarin. I can’t do it until I know Mandarin.

Best Financial Advice for Another Early-Career PhD

32:06 Emily: Chris, this has been such a wonderful conversation. I’m so glad you came on the podcast. I know we’re leaving the listeners wanting more. So where can they find you and where can they find your book?

32:15 Chris: So I’m available on Twitter @clcaterine, also on LinkedIn, Christopher L. Caterine. My book is available from Princeton University Press on Amazon and also at local independent bookstores.

32:27 Emily: Very good. And by the way, hat tip to Dr. Brandon Renfro who connected us, and you can listen to his episode, we will link that in the show notes as well. So Chris, the question that I ask all my guests at the end of our interviews is what is your financial advice for another early-career PhD? So would you please share that with us?

32:44 Chris: You know, we looped this earlier and I think budgeting is a really valuable tool and you should absolutely do it, but sort of don’t be tricked by thinking that the budget that you set for yourself as a graduate student is going to scale up. And yeah, you know run models, figure out what you might need to have the sort of life you want to live, and use that to figure out what kind of income you would need from a job to live that life. And if you have real data that backs it up, you can be really targeted in the jobs you pursue, both inside and outside of the academy, and find a career that works for your life.

33:21 Emily: Yeah. And I think that’s a wonderful exercise to couple with all the exercises that you lay out in your book. So thank you so much again for joining me on the podcast today!

33:29 Chris: Thanks so much for having me!

Outtro

33:37 Emily: Listeners, thank you for joining me for this episode. PFforPhds.com/Podcast is the hub for the Personal Finance for PhDs Podcast. On that page are links to all the episode show notes, which include full transcripts and videos of the interviews. There is also a form to voluntee to be interviewed on the podcast. I’d love for you to check it out and get more involved. If you’ve been enjoying the podcast, here are four ways you can help it grow. One, subscribe to the podcast and rate and review it on Apple Podcasts, Stitcher, or whatever platform you use. Two, share an episode you found particularly valuable on social media, with an email list listserv, or as a link from your website. Three, recommend me as a speaker to your university or association. My seminars cover the personal finance topics PhDs are most interested in like investing, debt repayment, and effective budgeting. I also license prerecorded workshops on taxes. Four, subscribe to my mailing list at PFforPhds.com/subscribe. Through that list, you’ll keep up with all the new content and special opportunities for Personal Finance for PhDs. See you in the next episode! And remember, you don’t have to have a PhD to succeed with personal finance, but it helps! The music is Stages of Awakening by Podington Bear from the free music archive and is shared under CC by NC. Podcast editing by Lourdes Bobbio, and show notes creation by Meryem Ok.

How to Financially Transition to Grad School as an Underprivileged Student

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In this episode, Emily interviews Rutendo Chabikwa, a first-year PhD student from Zimbabwe at the University of Oxford and the host of the podcast So, You Got A Scholarship? The topic is the financial aspects of transitioning to graduate school. Emily and Rutendo list start-up costs, explore the financial “hidden curriculum” of grad school, and discuss financial habits to establish and how to do so. This episode has a particular focus on underprivileged and/or international students.

Links Mentioned in This Episode

Teaser

00:00 Rutendo: If there’s something that you think somebody might cover, even if you don’t think somebody might go cover it, just ask. That’s definitely something I think underprivileged students can fall behind on simply because some of us have to cover a lot of gaps, not coming from families with people that have done PhDs or some of us who will be first-generation graduates to even begin with.

Book Giveaway Contest

02:19 Emily: Now, onto the book giveaway contest. In May 2021, I’m giving away one copy of Bad with Money: The Imperfect Art of Getting Your Financial Sh*t Together by Gaby Dunn, which is the Personal Finance for PhDs Community book club selection for July 2021. Everyone who enters the contest during May will have a chance to win a copy of this book. I’ve listened to a few episodes of the Bad with Money podcast, and I’m looking forward to reading and discussing this book because Gaby has such a different perspective and approach to personal finance than I do. If you’d like to enter the giveaway contest, please rate and review this podcast on Apple Podcasts, take a screenshot of your review, and email it to me at emily@pfforphds.com. I’ll choose a winner at the end of May from all the entries. You can find full instructions pfforphds.com/podcast. Without further ado, here’s my interview with Rutendo Chabikwa.

Will You Please Introduce Yourself Further?

03:24 Emily: I’m delighted to have joining me on the podcast today Rutendo Chabikwa. She is a first-year PhD student at the University of Oxford. She’s from Zimbabwe. So we are going to discuss in this episode the transition into graduate school, some of the financial stuff that goes on in that time, especially for underprivileged students. This is going to be really great episode. Rutendo and I have actually spoken before because I was on her podcast. She has a podcast called, So, You Got a Scholarship? and my episode of season three, episode one. So we’re doing a swap here. I’m so glad, Rutendo, to have you on my podcast. Welcome. Will you please tell the listeners a little bit more about yourself?

03:58 Rutendo: Thank you so much, Emily. Glad to be here. Glad we could do this. My name is Rutendo. Yes, I am a first-year PhD student, or DPhil as it is called, at the University of Oxford. I’m from Zimbabwe. But basically I have been an international student for the past about 10 years, starting with my two years of high school. Did that in Canada. My undergrad was at upstate New York at St. Lawrence University. So I have a bit of U.S. experience in there with also a couple of study abroads. And then my master’s was in London at the LSE and then now I’m here for my PhD. So it’s a bit, quite of a long trajectory over there, and I am studying information communication and the social sciences. So basically things to do with the internet, digital media, and political participation.

Costs for Anyone Starting Grad School

04:42 Emily: Wow. Okay. Yeah. Fascinating. Thank you so much. So we’re going to jump right in with talking about the financial startup costs for entering graduate students. And obviously you’ve done this before at minimum for your master’s and now again for your PhD. So you’re quite familiar. Let’s talk about this in three layers. One would be for just anyone who’s starting graduate school that didn’t require a move. Two, someone who did need to move to get to graduate school. And then three, someone who had to move internationally to start graduate school. So we’ll layer those on. So what are some costs in that first layer of just anyone who’s starting graduate school?

05:16 Rutendo: Yeah, absolutely. So anybody that is starting, I mean, there’s the obvious in terms of just generally your life in grad school, household items. I know that sounds very minimal, but it can be actually something that builds up and that we underestimate as well as, you know, your working equipment, your laptop. Right now, we’re in a pandemic, so everybody’s sort of working from home, but even outside of pandemic, generally grad students need to have really well stationed, you know, workspaces for your work. Books, and not just books that are not just textbooks as well, because you might have costs to do with like your research topics. Sometimes you might prepare having your own book to highlight or write in, things like that. And obviously we can talk about ways of minimizing those costs later, but definitely anybody going there, your stationary, books. Definitely.

06:07 Emily: Yeah. Well, I’ll add, you know, in the U.S., and you can tell me if you’ve experienced this at LSE and Oxford, but a lot of graduate programs in the U.S. seem to require some fees to be paid upfront. Like even before you ever get your first paycheck as a graduate student, you owe hundreds, maybe a thousand dollars of some kind of fee, which is just, I wish they set the system up differently. But it is that way in many places.

06:33 Rutendo: Absolutely. This is actually, I mean, even before actually getting accepted, right? So these fees, even for applications alone, so there’s that, and then getting accepted, the deposit fees. Sometimes you might be lucky enough to get a waiver. Sometimes not so lucky. They could, you’re right, go from a few hundred dollars to a large sum of your tuition as well. And then I think there are also, depending on your institution, fees, such as for student association fees as well. Those are definitely something to consider and look up how your institution works on that.

07:09 Emily: Yeah, those are the kinds of fees that I was referring to, like a recreation fee or an activity fee, or even sometimes the health insurance premium here, you know, it needs to be paid upfront. That can happen. So that could add up to a sum. The thing about that is that you can know in advance, right? So as soon as you figure out which school you’re going to go to in April, or whenever you do that, you can start asking what is the amount of money that I need to give you before I get my first paycheck? Now, I don’t want to say that everywhere is that way, because it’s not. But it’s definitely something worth figuring out as early as you can.

07:44 Rutendo: Absolutely. And also to find out from the different sort of stages, right. There’s fees, your department might have some type of fee or, I mean, if you come into something, I guess like the Oxford system, you might also try to talk to your college, see if they have any kind of fees or which is a different sort of department or different area. So to make sure that you’re checking boxes with different offices and different levels of the institution to make sure that you have that. Always definitely ask for that.

Startup Costs Associated with a Move for Grad School

08:09 Emily: Hmm. Yes. Okay. So let’s add a move on top of that. If you are moving, what kinds of, you know, startup costs are associated with that?

08:17 Rutendo: Oh, absolutely. Transport for sure. However way you’re getting there. Moving costs, shipping costs. In order to save money, you might have to use money. So in order to save money on buying all new items, for example, let’s say for your house, your desk, it might be cheaper to move with them, but that’s also a cost. So there’s, you know, you need to juggle that and, you know, do your tallies and do your trackings and write that out and see what’s cheaper and what’s easier for you and most convenient. So those moving costs are definitely a thing. Some people, I mean, I guess if you’re moving, then you’d have to consider things such as deposits on rent, rental fees. There might be costs as well for even finding a place to stay if your institution doesn’t provide that. Some people might work through agents. If that’s easier and safer for you, obviously different cities, different countries have different rules and regulations.

09:10 Rutendo: But I’d say that’s definitely a big thing to consider. So, and then the different taxes. Council tax in some places. I know in the UK, council tax is sort of like a big thing, which is one of the bills to do with, you know, your household that you need to consider and that you need to kind of look up at if you know, what’s easier and cheaper for you. If you’re a student, generally, depending on what household you’re living in, you can get a waiver for that. The process on that also requires research. I think the biggest expense is definitely if anybody moving, let’s say cities right now, would be things to do with, with living, added on to what we talked about before.

Different Scales of Moves

09:47 Emily: Yeah. I’m actually thinking back because there are different like scales of moves, right? So I’m thinking back to when I started graduate school, which I was living within a long drive, it was like a four-hour drive from where I was living before to my new graduate student city. So I was just able to drive with my stuff in the back of my car, did not bring any furniture. You know, it was pretty like low-key in terms of the actual transit costs. And then also I got into an apartment complex where they were doing, they didn’t require like a massive upfront deposit. It was some kind of like student special, you know, kind of thing. Like, so I feel like my move, which I did with no savings. I had like my last paycheck that was going to get me through two months, you know, to my first graduate student paycheck.

10:29 Emily: I did that without, you know, any real strain. I didn’t really buy furniture. I kind of lived without furniture for awhile, but that was a really, really low-key, low-scale kind of move. And like there can be, and we haven’t even talked about moving countries yet, but you can go way, way up on that scale. If you have an entire, you know, household, if you have stuffed move, if you’re flying and you have to ship your car, like plus as you just said, you know, I’m thinking about like Boston, where many people go through brokers and have to pay some kind of fee. Like, I don’t know if it’s a month’s rent like upfront just for that plus like the deposit, which could be large. Like, moves can vary so much from, I would say maybe a couple hundred dollars up to like thousands of dollars easily without even going, again, international. So like, that was my experience. I somehow like skated by with very little like actual outlay of money. What was your experience in this most recent move?

Rutendo’s Recent Move: 3 Suitcases

11:20 Rutendo: The most recent move? I could only fly with three suitcases. Somehow Emirates had a really great deal. So I could fly with three suitcases. In that, I made sure that I had my coffee pot because that’s always an essential, I had my bedding and my clothing, including my winter clothes. I knew winter clothes would be actually quite a big expense. So made sure that I had that over here. And then I didn’t have to buy furniture, thankfully, because I’m living in a student flat. So my apartment is actually furnished, so that’s great. But the biggest expenses now came into trying to, I guess, kind of make it feel like a home. Pots and pans, that that was not provided. The couple of basics. So it was a bit costly, but honestly, I guess not as costly as my master’s move, which is a whole different situation because I was not in student accommodation, which we could talk about later, the advantages and disadvantages of that.

12:13 Rutendo: So, this move was definitely slightly easier. But I did have quite some costs. And I did want to say there’s another cost that I think people, not even just internationals, might have to consider. If you’re changing things like your different insurances that you have, your health insurances. If you’re switching, you might need to do a bit more. So that’s also a cost that you need to consider, I guess, talk to your family about, or if you’re by yourself, figure that out how are you going to deal with those.

International Moves for Grad School

12:39 Emily: Yeah, absolutely. Okay. Let’s add that third layer on of now the move is an international move. Anything else you want to add about that particular cost?

12:47 Rutendo: Absolutely. Visa expenses. Sounds like just this one thing that you have to pay for, but then you need to consider the medical expenses within those. You need to consider health insurance within that. Some visas, like for example, the UK visa you have to pay, I think now it’s up to 500 pounds for every year of your visa. And so if you’re getting a five-year visa, it’s quite expensive. So you need to consider that. And then consider obviously things, things like flights you need to consider expenses to do with opening up a new bank account. You can get free bank accounts thankfully, but navigating that system. So, and if you’re going to a new country that you’ve never been to, I would say always make sure that you are able to have money to move around. So transport, to be able to do a couple of things in the first few weeks that you’re there. Add this to everything else that was mentioned before deposits: first month’s rent, household items, textbooks, and all the good stuff.

Challenges for Underprivileged Students Starting Grad School

13:46 Emily: Yeah. Wow. It can be quite a list here. So let’s now focus in particular on underprivileged students. What are the, you know, particular challenges that they’re going to have when they start up grad school?

Challenge #1: Funding

13:57 Rutendo: I’d like to talk about this in four different groups. So the first one is funding. I think this is the biggest thing to even begin with. Sometimes you can have funding for a year. Make sure you understand what your funding structure is as an underprivileged student. You want to know what is included and what is not included. Make sure that when they say it’s just tuition, you’re aware that it’s just tuition and you need to consider how you’re going to live and where that money is going to come from, what opportunities there are for RA ships, TA ships, how much they pay. And so to navigate that, before even I think I would say accepting and finalizing your offer. The different reasons why underprivileged students, you know, can have more difficulty navigating the funding structure, especially if you’re international, there’s that added layer. One of the things is that if you’re from certain countries, for example, I’ll give you the example of myself as a Zimbabwean. I am from a country that was formerly the Commonwealth and is no longer slash officially in the Commonwealth. So there are a lot of funding things that I could qualify for, but I don’t qualify for anymore. And so I needed to understand what I could get and what I couldn’t get. The offer I got, right now it covers tuition. My tuition is covered by the lab that I’m a part of. I’m a part of the computational propaganda lab here. However, there is no stipend. So for me to get a stipend, I need to work my maximum number of hours as an RA. And so that’s something I had to think about. Do I want to not have 20 hours a week to do my research, but to be an RA?

15:21 Rutendo: And so you need to be able to think about the time factor and how that is affecting or adding onto your work. Fortunately, my RA actually allows me to do the work in my research field. So it’s not like I’m spending 20 hours a week doing something that has nothing to do with my research, just so I can pay bills. However, I do need to do this so that I can pay bills. And so there’s that aspect as well of funding. And then one of the things I am consistently aware of is that my funding is pretty much dependent on grants that the lab has. And so that might be perceived as somewhat of a risk. However, it’s a bit of a new situation, not a new situation. It’s something that the lab has done for years. And so this is just how a lot of students in my lab are funded. But just me understanding that it’s not coming from a specific fund, is very useful for me to know what I can do and what I can’t do. So to ask those questions for funding.

16:14 Emily: Yeah, I totally agree. And I think this is, how funding works. It actually varies quite a lot by where you are the field that you’re in the type of university that you’re at. And so like, I am just thinking, Oh wow, I should really create a resource that’s like all just how funding grad school works. And I’m thinking to myself, do I know the full picture? Because I know things very well for certain fields that I’m close to, but like to know the full picture I think is very difficult. So for anyone, really, you do need to understand how funding works in your field, in that school, in that specific situation, where it’s coming from, what you have to do to get it, like you were just saying, how reliable it is, who it’s depending on? You know, if there’s a downturn in enrollment, are TA positions going to go away?

17:01 Emily: If your lab doesn’t get that next grant is like, that, you know, sector of your funding going to go away? Are there any guarantees? You know, guarantees at least in the U.S., they vary quite a lot. Some people get them. Some people don’t. Depends on the field. Depends on the school. Not getting one is not necessarily a bad sign. Although certainly getting one is a great sign. So there’s just a lot of layers to this. And yeah, I think the less versed you are in it, the more, yeah, you’re kind of flying by the seat of your pants, and it’s worth investigating for sure. Probably at an earlier stage than we’re talking about right now, we’re talking to basically rising or matriculating graduate students. And this is something you should ideally try to figure out kind of before you even apply so that you can, you know, know that you’re applying to the right places that have the right funding structure for you.

Challenge #2: Research

17:45 Rutendo: Then the next piece for me is research. Your actual research, but also I do need to say maybe this is in my field as a social scientist. I do not know how things work for sciences or humanities. But generally funding in terms of money and personal finances, there are things that your department, you know, some people can self-fund for a lot of things. So for example, some software that we use, some people in my department will say, Oh yeah, the software is fairly cheap. And I just subscribe this much a year. For me, that takes quite a bit out of my budget, you know? And it is part of research. It is actually part of a research cost. So things like that. However, I guess the best way to go about it is to talk to your department about it and understand what you need for your research.

18:27 Rutendo: If anything, if you think anything at all is tied to your research, talk to your department about it because they should be able to support you through that. But definitely I think as an underprivileged student, if I hadn’t spoken to other people who have navigated the system before, I would be worried about buying such software, for example, or I would be worried about managing the cap on the research fund that I have to be able to do field work and get those needs met as well. And so I think that’s definitely something that, you know, you kind of learn as you navigate the system. Yeah.

19:02 Emily: Yeah. Absolutely totally agree. Ideally, get someone else to pay for everything. And if not, at least you ask and then, you know, well, this is not something that we cover. And then you get to decide, you have to decide if it’s something that you’re willing to do out of your personal funds. But just apply, apply, apply, I would say, for funding. You know, extra grants. A lot of times travel in U.S. institutions sometimes comes down to the student to fund. Like, you know, summer trips to here or there to do their research. Basically, you’re going to get a grant for it, or you’re not going to go. I don’t think that too many people fund those things by themselves, but the smaller costs, like you were saying, like software or some kinds of equipment. Yeah. You should definitely be asking, at least, that your department will do it.

Challenge #3: Professional Development

19:44 Rutendo: For sure. The third one is professional development, and these are things that are not necessarily tied to your work or your research, but you need to do to begin to build up your CV or your presence in the field. And so some of the things might include, some courses offered through either online courses offered through either organizations or sometimes schools do actually offer these, but you still have to pay for them. So I know my library offers different professional development courses and, you know, each of them cost like about 15 pounds, a course. And so imagine taking about, you know, four or five of those a year. For some people, that could add up quite a bit. There could be things like attending conferences as well, that are not necessarily hosted by your school. It could be things like attending events.

20:37 Rutendo: I mean, I know I’m saying attending now, they’re all on online. Some thankfully are free, some still aren’t, which is still a cost for a lot of people. And so even though these things aren’t necessarily tied to your research, these are expenses that some students have actually footed themselves, but I don’t think it’s necessary for you to always do that. And this is, once again, when we talk about applying for assistance. But when it comes to applying, I do want to point out that the information isn’t always out there explicitly to say, Hey, there’s money. You can apply for this. So if there is something that you think somebody might cover, even if you don’t think somebody might cover it, just ask. The chances are that somebody will know where the answer is. Even if it’s not, you know, on the website that says, Hey, we offer professional development funds. But that’s definitely something I think underprivileged students can fall behind on simply because some of us have to cover a lot of gaps, not coming from families with people that have done PhDs, or some of us will be first-generation graduates to even begin with. And so we might have a lot more things and a lot more sessions or professional development work that we need to do but not enough money to actually pay for those things. And so there are a couple of costs entailed in that.

21:52 Emily: Yeah. And when you say ask, I just wanted to point out, who? Who should the people ask?

21:59 Rutendo: A supervisor, I would say start with your supervisor as the first port of call is your supervisor. Your department might have somebody that’s in charge of your program as well. I don’t know how different institutions work, but generally there’s someone that’s not necessarily your supervisor, but oversees your actual program. Those are the people to talk to you. And then if it’s things that are very just professional development focused, career services. I know a lot of schools have career services departments.

22:24 Rutendo: Those places are actually really great, whether you’re an undergrad or a PhD student. They know a lot about what’s going on. And so definitely those three, start off with those three. One of them will be able to assist.

22:36 Emily: Yeah, I would also add older students, students ahead of you. If they’ve done a conference that you want to go to, just ask them if they had it funded from somewhere. If they say, no, that’s not necessarily the final word, but if they say yes, then you’ve gotten a really good lead. And I would say also, you know, the person in charge of the program at my school that was called the Director of Graduate Studies, DGS. That person has an assistant. That is the person who knows everything going on everywhere. So that is the person to befriend to get on your side to advocate for you. That person is going to be an amazing resource just generally, but specifically with respect to funding and knowing how everything works behind the scenes.

23:17 Rutendo: That is definitely true. There is always that one person in administration who’s a great person to know. And I agree with that. Finding those people is very useful.

Commercial

23:28 Emily: Emily here for a brief interlude. Taxes are weirdly, unexpectedly difficult for funded grad students and fellowship recipients at any level of PhD training. Your university might send you strange tax forms or no tax forms at all. They might not withhold your income tax from your paychecks, even though you owe it. It’s a mess. I’ve created a ton of free resources to assist you with understanding and preparing your 2020 tax return, which are available at pfforphds.com/tax. I hope you’ll check them out to ease much of the stress of tax season. If you want to go deeper with the material or have a question for me, please join one of my tax workshops, which you can find links to from P F F O R P H D S.com/T A X. It would be my pleasure to help you save time and potentially money this tax season. So don’t hesitate to reach out. Now, back to our interview.

Challenge #4: Emergencies

24:34 Emily: Okay. And we had a fourth one, right?

24:38 Rutendo: Now, the last one has nothing to do with all of these other things, but it’s emergencies. These happen. And sometimes, especially as a student, as an underprivileged student, if you’re moving somewhere new, you might have used most of your money for moving in and getting settled, but emergencies do happen. And this actually recently happened to me whereby I needed to go to an emergency room. Thankfully, it was not COVID-related. So just have to say that in a pandemic, just to make sure. However, you know, I ended up being able to talk to my welfare team here at the college and they covered a lot of the costs for a lot of things that I didn’t even know they could be covered for that are emergencies simply because I wasn’t ready then when that happened.

25:25 Rutendo: And so I think it’s really important that we understand that whatever emergencies we face to be able to be open about them, to the best of our abilities and you know, and obviously balance keeping your privacy and your private information private, but also letting letting the right people know to give you assistance. Because while some people might be able to just write their families and, you know, call up home and say, Hey, look, I need an extra, this amount of money. Some people might not be able to. And so to know that most universities will be, there will be some funds somewhere. I know my university has something called hardship funds for things like that. And different levels of it that you can apply for, but definitely the understand that emergencies for underprivileged students can be something difficult to navigate and challenging as well.

26:13 Emily: Absolutely. Absolutely. Could not agree more. I think in the U.S. it’s becoming more common, but I wouldn’t say it’s totally common, that universities or graduate schools have either emergency grants or emergency loans available. It’s not everywhere, but it’s definitely, definitely worth inquiring about because it’s, yeah, it’s becoming more and more popular to set up those kinds of things. As we understand, not everyone has the means to cover an emergency in cash or has access to debt even to finance an emergency or has family to fall back on or whatever the case may be. Yeah, not everywhere, but definitely worth asking about.

People are Your Best Resource: Talk to Them 

26:53 Emily: Okay. Yeah. Anything else you wanted to add about sort of helping, you know, underprivileged graduate students prepare for starting graduate school or, you know, make it to the end? Because finances are a big reasons that people leave PhD programs.

27:08 Rutendo: I mean, I would say that, you know, the most important thing in terms of getting a hold of your finances is also just, you gave the advice of talking to older students in one of the specific categories for professional development. But in general, talking to as many students as you can, once you accept it, try to connect. If there are any people that you see online, if you’re on Twitter, for example, you know, when somebody says I’m doing this program, try to connect with them. I set up a couple of Zoom calls with third years and second years and even people that had just finished their PhDs in my department, just to talk to them, just to hear about their experiences and, you know, students, you know, not just underprivileged students, but everyone just to know about the experiences outside and inside to know what I need to prepare.

27:51 Rutendo: And so I think that’s part of your research and getting so that you really understand your finances. Especially if you’re going to be doing some form of RAing or TAing, it’s important to talk to somebody that has done it so that you understand such as the salary structures as well. Because, you know, sometimes they tell you, this is how much you get paid pro rata, but you don’t even understand what pro rata is, for example. And so it would be useful to talk to people. So I’d say, that your best resource is people that have been through the very same system as well. And just understand the general lifestyle that helps you understand the costs, you know. So just asking them what they do in general, how much things cost, ask people where they go shopping, what things they had to buy, things like that would be very useful as you are preparing to go, and helps you definitely understand your finances, even before you start.

Establishing Good Financial Habits in Grad School

28:40 Emily: So the last thing we wanted to talk about was establishing good financial habits at the start of graduate school. Both what those habits might be, and how to actually go about establishing them, which is really the key. So let’s talk about what habits are great to establish at the beginning of graduate school, and for each one, how people can do that.

Habit #1: Track Your Expenses

28:57 Rutendo: Okay. I think the first habit is to track your expenses.

29:02 Emily: I always say that number one as well.

29:03 Rutendo: Which is, I must actually say, something I got from your podcast. So I listened to this podcast before doing my PhD and honestly like it’s, I went on a binge and it has been very useful for me. And I learned to track, just track. So what I did was I had the first month of not knowing, you know, what is needed or no projections, not knowing how much I might be able to save, just to track everything I bought. It sounds tedious, but you do need to track. And so the how, I think there are different ways of doing this. The way I did it was I used Notion. So I made a table and this sort of like budget looking thing in Notion, even though it wasn’t a budget, it was what I was spending.

29:50 Rutendo: And I had categories for each thing. So groceries and toiletries. So I knew that week one, this is what I spent. Week two, this is what I spent. So that helped me also see an average about on average per week, what am I spending on this? And then I kept my subscriptions. So knowing what subscriptions, you know, I have, and then during that month also making sure am I actually using them, like I have Spotify premium. Do I actually use it? How important is this feature for me? And then there were miscellaneous as well. Things that I, you know, that I’m spending on this month that I won’t necessarily be spending on next month, but just to understand that how much cushion and move room do I have in my budget for that? So I wasn’t going to be buying pots and pans every month, for example. But I kept that in there. That helped me understand an average. Because there will be some things that I will need to pick up throughout the month that are not in necessary, you know?

30:40 Rutendo: So having all of that. The other way you could do your tracking is to use the budget apps, you know, the ones that you connect your bank accounts to an app. I think in the U.S. it might be mint that most people use. In the UK, I use money dashboard. Personally, I find that to be really good. It has, you know, web interface and app interface, and it’s fairly automatic. And so habit number one is track. Just, you know, just to understand exactly what you’re spending. Don’t try to, and don’t lie about anything. If you spend, if you spend money, I spend money on sparkling water because I love sparkling water and I don’t have a soda stream. I wrote that down just so that I actually understand how much money I’m spending on sparkling water. Things like that.

31:32 Emily: Yeah. Completely could not agree more. And I would say when you’re choosing like this manual method, which as you said, can be tedious. I think there’s a lot of power there in the tedium and staying close to the expenses. But if you know yourself and you know that you’re not going to do it, you know, you’re not going to do this daily or multi times per day or whatever it is, and you decide to use mint or you need a budget or something similar, that’s okay. Know yourself, know what’s sustainable for you. And just choose something that, as you said, can become a habit and it is, you know, less maintenance to use one of these automated systems, yeah. But whatever can become easiest for you to sustain. I know for example, I kind of fall on this manual tracking side of things. My husband will not do that. So for us keeping a joint budget together, it has to be software, or it’s not going to get done. But it is a habit. And when we use software, we do check it. So whatever you think is sustainable for you in the longterm.

Habit #2: Understand Your Expenses

32:22 Rutendo: Right. Absolutely. And then the second habit would be connected to the tracking. So after the tracking comes the budgeting. And that’s something that I have found to be very useful. So I then moved, after understanding my expenses, I then, you know, created like a, okay, so per month here’s how much I want. Here’s, you know, on average how much I think I need for groceries, how much I need, I think, for this and this and that. And then I then moved it into the automated system. The automated system for me was easier simply because there were things that I could grab, let’s say, and sometimes forget to enter. I was afraid I’d forget to enter manually because I was no longer in the tracking phase. I was now in, you know, I’m technically still the tracking phase, but you know what I mean?

33:04 Rutendo: Like in the actual making sure I understand how much I spent of what phase. And so I moved that understanding to money dashboard and had all the different categories. And, you know, it’s been very useful, but like you said, even if you do automate something, it’s a habit. So I do check my money dashboard just to make sure that an expense has gone into the correct category or into the category I want it to go into by the categories I’ve set in my budget. So, and also just to see how far I have, how much do I have left this month for this specific thing?

33:35 Emily: One thing that I think is really valuable about tracking, and also budgeting to an extent, is even if you don’t really think you need to do it right now, you may, six months from now, want to look back at that data and, you know, get some insights from it because of a decision or something you have to make at that point. So, it’s just a good thing to make a habit, you know, make as low maintenance as you possibly can, just so you may want to use that data in the future you’ll have it.

34:03 Rutendo: Absolutely. Yeah, one thing I do understand that because of, I do regret not having had a budget during my master’s degree because it was in the same country, so I really have no excuse. So, I couldn’t actually say how much I spent on groceries on average. You know, now I can say that and now I can. And so I do agree. It is nice to just have that data at some point. You never know what you might do next in a couple of months or a couple of years even.

Habit #3: Save

34:30 Emily: Yeah. What’s the next habit on your list?

34:33 Rutendo: The next habit on my list is to save. This one is a bit, I think people, people go about it different ways. I know that the advice generally is pay yourself first, which I understand is great advice. As somebody who’s not that wealthy, not even, let me not even put a “that.” Who is not wealthy, who is mostly just doing enough to get by, paying myself first is actually quite, quite difficult, even on my budget categories. What I always do know is that I always have some little leftover. So I do this thing that I actually learned again from another guest on this podcast, which is at the end of the month, whatever I have leftover in my checking account, I put into my saving and I start from zero with my new paycheck. That is my saving. And then there’s also the other way that I save, technically kind of like save/invest, is through this app called Moneybox.

35:31 Rutendo: I think the U.S. equivalent might be Acorn. I don’t know if that’s what they do, they round up your expenses and sort of, kind of like quote unquote invest it for you. It’s not like you’re investing in big, very risky, you know, things. You’re not making like $5,000 worth of investments, but it is quite nice to just see that number go up. You know, if I buy something and then there’s 20 pence left, knowing that that 20 pence is going to do something. Because also, at the end of the day, in my head, in my budget, anyway, that was a round figure, right? That was not necessarily 0.8. you know. And so, that sort of save and invest model, I find it to be very useful, to always try and save. And it’s useful to save, even if you’re saving very little, because once again, emergencies do happen.

36:19 Rutendo: And then it also is useful to try and strive towards getting to that three to six months worth of expenses, which is something you don’t always start with. Especially if you’re somebody that’s not coming from a wealthy background. You don’t always start out with being able to have three to six months worth of expenses in your savings account. But that little bit counts. Just that little bit counts, and hoping that emergencies don’t happen. Knock on wood. You will get there through I guess some of the other things we’ll talk about.

36:44 Emily: What I really like about that articulation. Now, of course I am an advocate of pay yourself first. I definitely am. But what I like about how you’ve set things up is that saving is not, even though it’s the last thing you do with your money each month, it’s not the last thing on your mind. You know throughout the month that you have that intention of doing it at the end. And so I’m sure it affects your behavior. Oh, well, I want to be able to save a little bit more this month. So I’m going to really try to come in under budget on this category, because I know that’s going to enable me to save this much more. And so what I like about that is that it’s still an intentional thing that you have throughout the entire month, even though you do the action at the end.

37:20 Emily: And I think that, you know, sometimes that’s just how you need to start. And when you’re living essentially paycheck to paycheck, you know, there’s a possibility you might spend your entire paycheck that month, if something odd came up and you can’t, you really can’t, you know, set anything aside in advance. It’s okay to do that system. As long as it’s working for you most of the time, most of the time that you’re able to save something at the end of the month and increase that savings as you were just talking about. I think, you know, it’s, it’s a way it’s a way to start. It’s a way to start saving,

37:47 Rutendo: Right. Also, just to actually say that that’s what I’m doing now, because I’m just starting out. So my intention right now is, because technically I’m still settling in. So there are still odd expenses that are coming up here and there since I’ve been here for a couple of months, but I don’t think that’s what I’ll be doing, let’s say, next year, this time. By then I will have, you know, very few things that come up and I will now know exactly what I can save, even if I’m still living paycheck to paycheck, which then just becomes something I do first. And so this is definitely something transitionary, but yeah.

38:18 Emily: I think it’s also easier as you learn a new city to become more frugal with time. You know, you mentioned earlier, well, where do you shop? That’s a very key question. Maybe when you first move to a city, you don’t know the least expensive places to shop, or the places that have the sales at this particular day of the week. You don’t have that insight. And so, you know what you’re spending on groceries, for example, in month one, you might be able to spend much less by month 13 because you figured out a few of those tricks. And so don’t think that just because you’re starting out completely paycheck to paycheck, that you’re going to be that way forever, because you will learn over time if you’re, you know, if you’re minded in that way.

38:53 Rutendo: Absolutely.

Habit #4: Learn How to Be Frugal

38:54 Emily: Okay. So do you have another habit on your list?

38:56 Rutendo: Yes. Which you actually kind of got to, which is understanding the best way you can be frugal. I put it in a different category than saving because the saving is something very technical, but the other habit you can do is try to find out how best you can reduce costs. It doesn’t matter how little it sounds. You know, for example, Spotify premium, normal is 9.99 pounds, student is 4.99. You might think, okay, that’s not much, but it is, it sort of adds up. So if you know what, just that extra amount of time it takes for you to sign up to student, if you need that. If you use that. Or knowing exactly where to shop, right? And if you go to the store and we’re like, here, we have reduced shelves where you can get fruits and vegetables that are technically about to go bad, kind of like the shelf date really, saves a bit more, you know, I could buy an avocado for 40 P or I could buy it for two pounds 70.

39:47 Rutendo: So then I get two avocados, instead. You know, something like that, just, just being as frugal as you can. If there are books that you want to buy, trying to get them second hand, instead of getting them new. You know, or if it’s something that you actually don’t need to be writing in and that you just want to browse, consider getting it from your library instead. If you’re fortunate enough to be living in, you know, even in a pandemic, some libraries are doing, you know, click and collects or things like that. So try to do that. So just finding ways to be frugal, no matter how small the amount seems, definitely adds up. And the other technique, and this is cash backs as well. I know that some banks do different cashback things with, you know, different retailers or you could actually sign up for like I think in the UK there’s TopCashback or something I think is also a U.S. thing online.

40:44 Emily: I use Rakuten.

40:46 Rutendo: They do have that. Yes. Yes. So things like that definitely, you know, for things that you’re going to buy anyway, might as well get a percentage of it back it’s really useful. And these things I know they seem very minimal when you think about you’re like, Oh, it’s 5%. It adds up. It adds up, and that 5% could be something that goes into your savings, for example. Fine. If you don’t want to spend it on something new, that’s how you end up getting to your three to six months worth of, you know, expenses of savings. So.

41:16 Emily: I was just going to say, tie any little frugal, you know, tactic that you implement to directly increasing your savings rate. If that’s your top goal at the moment, right? So if you, as you were just saying with Spotify, for example, you know, you reduce it by $5, whatever it is, Hey, why don’t you pay yourself first $5? Because you were spending that anyway. So that’s the way you can kind of transition between these two systems, or save at the end of the month. Hey, my grocery budget was this, but I came in, you know, $10 lower because I’ve learned all these frugal things to do. Okay. Your $10 at the end of the month gets to go into your savings. Yes. I love that idea. Yeah. Did you have another habit?

A Note on Side Hustling

41:52 Rutendo: Well, technically it’s not a habit, I guess, because a habit would have to be things that you do consistently, but then to try and be on, this is the last thing under this question, to try and do like side hustle type of things. I don’t know if I could classify that as a habit or a thing. But also, I mean, obviously you have to consider how much time it takes away from your work, because, you know, first and foremost, you are a student. But if possible, you know, there are different ways. Some people do short-term consulting things. I know for me, the thing that has helped me right now is a short-term consulting gig which I know, you know, at the end of that will help me build up my savings so much faster than, you know, saving the little bits off of my paycheck and things like that.

42:34 Rutendo: And so to find out where your skills lie, if somebody wants help with like a couple of editing, copyrights, things like that, that you could take away just a couple of hours of your time to do. Not necessarily to make that become the focus, but only if possible. And this is something that sometimes is also really a sign of privilege as well, actually, rather than something I’d advise underprivileged students to do, because sometimes you have more things to deal with, honestly, than side hustling. So this is why I’m not saying this is necessarily a habit, but if you feel that you do have that privilege of time and space and mental capacity to do that, then do so. But don’t necessarily, please, if there’s something you can’t do feel obligated to.

43:16 Emily: Yeah, absolutely. I mean, you’re primarily in your degree program to get that degree. So I always say about side hustling, like, don’t do anything that’s going to jeopardize your progress toward that end goal. But if you have the capacity, it can be a really great supplement. And like you were saying, I think that sometimes graduate students you know, they end up devaluing what they’re capable of doing because they’re being paid such a low, you know, rate through their stipend or whatever. If you can do consulting, as you were just saying, or employ your skills in another non-academic capacity, especially, you might be able to command a fairly high pay rate, at least compared to what you’re getting through your primary work as a graduate student. And so don’t think that a side hustle is going to be 20 hours a week or 10 hours a week.

44:03 Emily: It could be, as you said, two hours a week and still make a really big impact on your budget. If you select it very carefully, really employing what makes you unique in the marketplace. Now I will say, because we’ve been talking a lot about international students in this interview, in the U.S., international students are extraordinarily limited in what they’re permitted to do in terms of making money outside of their primary position. That is, they really can’t do anything unless it’s been approved through like CPT, like OPT kind of situation. So I’m not encouraging international students to side hustle to work for money, but there might be ways that you can set up passive income sources that it’s not actually exchanging work for money, but other ways you might be able to make money. You mentioned cash back earlier. Credit card rewards are a thing.

44:51 Emily: They can be fairly lucrative. I’ve had a couple episodes in the past on that. So I’ll link them from the show notes. International students would not be able to do that day one arriving in the U.S. because you have to work on your credit score first. But after a year or two, that might be a possibility as like a passive income source. So you are going to have to be a little bit more creative in your thinking about side generating side income as an international student, but it is still possible. Maybe it’s worth looking into again, if you have the time and the energy to do so.

45:19 Rutendo: Precisely. Yes.

Best Financial Advice for Another Early-Career PhD

45:22 Emily: Okay. Rutendo, thank you so much for this wonderful interview. I think we’ve gotten so many insights out of it. I will ask you for one last one, which is what is your best financial advice for another early-career PhD? And that can be something that we’ve already touched on in the interview, or it can be something completely new.

45:39 Rutendo: I would say, we’ve already talked about this. If there’s a chance that you don’t have to pay for it, don’t. It doesn’t matter what it is. Just ask if there’s a chance that you don’t. Because it doesn’t matter how many times you track something, how many times you budget something, if you can get it from somewhere else, all these other habits, all these other things will be better as a result of you not necessarily having to go out of your way to do this. So that’s the biggest thing for me.

46:04 Emily: Absolutely. I think, you know, maybe a more broad category of term for this is just negotiation. Like you can kind of think about it that way, because you’re just sort of ferreting out, you’re feeling out, is there a possibility that someone else can foot this bill for me? Is there another creative way that I can get this paid for by someone else? I know in the U.S. we don’t have a strong culture of negotiation at all in terms of like sales or anything, but I know that other countries, it’s more of a common thing that you learn in your childhood. And so if that’s your, you know, personality, maybe you can think of it that way as just feeling out what are the possibilities here, financially? What are the parameters of this space? Yeah. And oftentimes that’ll be to your advantage. I mean, you’re not going to get anywhere by not asking. That’s for sure.

46:46 Rutendo: Definitely. And I mean, I do just want to say that, especially for underprivileged students, the one thing I do want to say about the reason I’m giving this advice and I put it, so plainly is because a lot of us it’s about our mindset. A lot of us were, you know, I mean, let me not say a lot of us, but then for me, the problem I had to get over was knowing that I had to work for certain things and then sort of feeling that I am not allowed to have certain things, just the social conditioning, right? That I’ve already come this far as like a Black African woman. Now I have to ask again, if they could pay for this conference. Now I have to ask again, but really just, there are people, you know, once I started talking to people that have been doing this for four years and some people for generations because the families had already navigated the system. This is actually what the system is the afford to support you, to become the best that you can be as a researcher, as a student, as whatever it is that you’re doing.

47:40 Rutendo: And so it’s not necessarily, I hope that a lot of people realize it’s not in sense of entitlement, but really just to understand that there are systems of support that might not be explicitly said, you know or stated that they are there, but they really are there for you. And to help you with your finances. And like you said, Emily, at the beginning of the interview, a lot of people are beginning to understand now that finances really impact underprivileged students’ experiences in these institutions. And they are open to that and open to discussion and negotiation. So.

48:12 Emily: That was so well put. Thank you so much for this interview, Rutendo. It was a pleasure to speak with you again.

48:16 Rutendo: Thank you so much. Thank you for having me. I appreciate it.

Outro

48:23 Emily: Listeners, thank you for joining me for this episode. Pfforphds.com/podcast is the hub for the Personal Finance for PhDs Podcast. On that page are links to all the episode show notes, which include full transcripts and videos of the interviews. There is also a form to volunteer to be interviewed on the podcast and instructions for entering the book giveaway contest and submitting a question for the Q&A segment. I’d love for you to check it out and get more involved. If you’ve been enjoying the podcast, here are four ways you can help it grow. One, subscribe to the podcast and rate and review it on Apple Podcasts, Stitcher, or whatever platform you use. If you leave a review, be sure to send it to me to share an episode you found particularly valuable on social media with an email listserv, or as a link from your website. Three, recommend me as a speaker to your university or association. My seminars cover the personal finance topics PhDs are most interested in like investing, debt repayment, and taxes. Four, subscribe to my mailing list at pfforphds.com/subscribe. Through that list, you’ll keep up with all the new content and special opportunities for Personal Finance for PhDs. See you in the next episode! And remember, you don’t have to have a PhD to succeed with personal finance, but it helps. The music is Stages of Awakening by Podington Bear from the free music archive and is shared under CC by NC. Podcast editing and show notes creation by Meryem Ok.

How This Prof Developed Her Career, Family, and Finances (with Dr. Sarah Birken of AcaDames)

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In this episode, Emily interviews Dr. Sarah Birken, a faculty member in the Wake Forest School of Medicine and co-host of the podcast AcaDames. Sarah tells the story of her financial life from her PhD training to her research faculty position at UNC to her new tenured position at Wake Forest, which paralleled the births of her children. She has recently experienced a financial awakening after years of being unaware of her cash flow. Sarah explains the motivation behind some of the financial decisions she’s made, such as working part-time and accepting her position at Wake Forest. Graduate students and PhDs who aspire to become faculty members and/or parents will find this episode fascinating!

Links Mentioned in This Episode

career family finances PhD

Teaser

00:00 Sarah: I think I probably would have taken out a loan and, you know, if I could have understood that I would be making an amount of money in the future and really taken that into account and would be able to pay off a reasonable loan, I probably would’ve done that.

Introduction

00:22 Emily: Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. I’m your host, Dr. Emily Roberts. This is season eight, episode 12, and today my guest is Dr. Sarah Birken, a faculty member in the Wake Forest School of Medicine, and co-host of the podcast AcaDames. Sarah tells the story of her financial life, from her PhD training, to a research faculty position at UNC, to her new tenured position at Wake Forest, which paralleled the births of her children. She has recently experienced a financial awakening after years of being unaware of her cashflow. Sarah explains the motivation behind some of the financial decisions she’s made such as working part-time at UNC and accepting her position at Wake Forest. Graduate students and PhDs who aspire to become faculty members and or parents will find this episode fascinating. On the theme of post-PhD financial life, I thought I would give you another update on my family’s house-hunting process since it’s almost literally all I can think about at the moment. The housing market is wild right now, y’all.

01:29 Emily: My husband and I are trying to buy a single-family home in the San Diego area. We are first-time home buyers, and we are looking for a home we can live in for the next 20 years, at least, which is putting a lot of pressure on the process. We look at every home to see if it can meet not only our immediate needs, such as sufficient indoor and outdoor space for us to weather the rest of the pandemic, but also our anticipated needs when our children are in high school. The cycle that we’ve fallen into just about every week for the last six weeks is to monitor the listings that go up throughout the week and message our real estate agent about any houses we want to see that weekend. On Saturday, we drive from Orange County to San Diego County, leaving our kids with their grandparents.

02:14 Emily: We see between one and four houses and debate the merits of each house for the rest of the weekend. Finally, we submit an offer or not by early in the following week. Then the cycle starts over again, even before we hear back about the offer we submitted. As of the time of this recording, we have submitted three offers on homes, none of which have been accepted. All of the offers were between seven and 12% over the asking price. With the latter two offers, we waived the appraisal contingency, which means that we still intended to buy the home, even if it didn’t appraise for the sale price, and would bring cash to the closing table to make up the difference between the appraisal and sale price. I never knew that was a thing before getting into this process. Our offer was the first runner-up on the latter two homes, which I suppose means we’re offering in the right ballpark.

03:07 Emily: On the second house, we lost out to a buyer who was quote, “willing to beat any other offer,” end quote. And on the third house, we lost out to an all-cash buyer who waived all contingencies. So, on top of California real estate prices always being mindbogglingly high, inventory is very low at the moment. And buyer demand is bidding prices up well over asking. It seems like a very bad time to buy. Yet, here we are trying to, because we are personally and financially more than ready for this step. I’ve been trying to think of advice for future first-time home buyers in my audience, and I might end up doing a whole episode on this process once it’s complete. For now, my advice is to do absolutely the opposite of everything we’re doing.

Emily’s Home-Buying Advice

03:50 Emily: One, don’t buy in a sellers market. Two, don’t buy in a pandemic. Three, don’t buy from a distance. That is, unless it’s the right time to buy, like it is for us. My one actionable piece of advice right now for future buyers is to regularly go to open houses, starting well in advance of when you actually want to buy. In California during the pandemic open houses aren’t allowed. So we missed out on seeing lots of houses casually. We only see a very small number of houses seriously. The problem is that we didn’t really know everything that we were looking for when we started the process and we’ve become more specific in our vision as we’ve seen more homes. We’ve probably doubled our list of must-have and nice-to-have features since including minimum square footages for various areas of the home and lot. It’s the kind of stuff we never paid attention to when simply visiting other people’s homes. We’ve also learned about sort of California-specific things like unpermitted additions and Mello-Roos. So, there is a big learning curve for first-time home buyers. And that open house phase, I think would have been really helpful. Wish us luck to get a house soon so we are put out of our misery.

Book Giveaway Contest

05:06 Emily: Now, it’s time for the book giveaway contest. In March, 2021, I’m giving away one copy of I Will Teach You to Be Rich by Ramit Sethi, which is the Personal Finance for PhDs Community book club selection for May, 2021. Everyone who enters the contest during March will have a chance to win a copy of this book. I’m personally really looking forward to reading I Will Teach You to Be Rich for the first time. I have recommended this book and given it as a gift before, but never read it. I do know, however, from reading Ramit’s website and listening to interviews with him that in some ways he has a very different approach to personal finance than I do, such as putting a big emphasis on earning more. So, I think I’ll really benefit from reading a full book from his viewpoint. If you would like to enter the giveaway contest, please rate and review this podcast on Apple podcasts, take a screenshot of your review, and email it to me at emily@pfforphds.com. I’ll choose a winner at the end of March from all the entries. You can find full instructions at pfforphds.com/podcast. Without further ado, here’s my interview with Dr. Sarah Birken of AcaDames.

Will You Please Introduce Yourself Further?

06:17 Emily: I have a really special guest joining me on the podcast today. It’s Dr. Sarah Birken, you know her from AcaDames where she’s a co-host. She also recently became a faculty member at the Wake Forest School of Medicine. So congrats to Sarah for that. And we are going to be talking today about finances through career transition points. And it’s a real pleasure for me to get to speak with someone, interview someone on the podcast who has been through a few transitions, you know, post-graduate school. So I think she’s going to have some really great lessons for us who are a little younger on in our career to to take from it. So, Sarah, thank you so much for joining me on the podcast. And will you please introduce yourself a little bit further for the listeners?

07:00 Sarah: Yeah, sure. Thank you so much for having me. It’s a real pleasure. And I’ve been getting some friendly joking from friends and family that I’m on a personal finance, finance podcast. But yeah, so Sarah Birken, I am an Associate Professor in the Department of Implementation Science at the Wake Forest School of Medicine Division of Public Health Sciences. And as you mentioned, AcaDames co-host. I have been in the field of implementation science since the end of my PhD where I found out that that was in fact what I was doing. My post-doctoral fellowship was in cancer prevention and control. And as we’ll talk a little bit more about, I started out in a half-time research faculty position after my post-doc then moved to full-time and just in July 2020 transitioned to a tenure-track position at Wake Forest.

Sarah’s Finances and Money Mindset in Grad School

08:00 Emily: Yeah, it’s fantastic. And I know you covered that very well on your podcast. So, we’ll link to, in the show notes, a few of those episodes. So let’s start, you know, way back during graduate school and tell us what your finances were like at that time and whether you were aware of them working on them at all? Maybe not?

08:18 Sarah: Yeah. I mean, I have the benefit of having been partnered with somebody who was always very on top of finances. And I started graduate school after having made very, very little money as an administrator at a community health center. And when I applied for graduate school, I had like a vague sense that I wanted to make more money than I was making at the community health center. It would’ve been hard to make too much less than that, but I mostly, my objectives were not to be in a ton of debt and to be able to pay for graduate school, period. And when I applied for graduate schools and I did all over the country and got a full ride to UNC, that was so much of a blessing. I didn’t even, I mean, I knew that I was really lucky and I knew how wonderful it was that I wasn’t going to have to pay for graduate school, but I didn’t fully understand it at the time because I was pretty irresponsible with money.

09:31 Emily: Did anything regarding like your money mindset start to change during graduate school? And were you making more money, by the way, than you were from your prior job?

09:40 Sarah: Yeah. I was making not an appreciable amount more once I was in graduate school, right? Because I had, you know, my tuition and health insurance paid for, and I had a stipend through graduate school, but it was peanuts. It was really very little money. And so I just got accustomed to spending very little. I didn’t take out any loans because I didn’t have to, but I didn’t spend very much because I didn’t have very much to spend. So my, you know, modus operandi was just spend as little as possible, which I think in retrospect was not a great idea because instead of thinking of how much do I have to spend, it was just head in the sand. Don’t spend too much.

10:32 Emily: Yeah. So it sounds like you were, yeah, sort of in denial about, or like not wanting to deal with money very much.

10:39 Sarah: Oh yeah. Correct.

10:40 Emily: Thankfully the good part of that is you were erring on the side of not overspending, but underspending, but had you been in a little bit of a different headspace, you would have loosened the purse strings a little bit.

10:50 Sarah: Yep, yep. Exactly.

How Having a Child in Grad School Shifted Finances

10:52 Emily: What else happened in graduate school that affected your finances?

10:55 Sarah: Yeah, so I transitioned from the master’s program into the PhD program. So I completed the master’s and then started the PhD. And the stipend situation was really the same. I again had the tuition remission and the health insurance covered and the stipend, and I was kind of, you know, rocking and rolling doing the graduate school thing. And then I became pregnant with my first child in my second year of graduate school. And kind of, that was a big wake up call. Like I can, I can certainly continue to try to spend as little as possible, but I’m going to have a whole new creature to take care of. And some immediate things that became clear were that I needed to not live next to the drug dealer who I was living next door to anymore. I didn’t feel like I was in imminent danger, but certainly it was not a setting, it was a ton of graduate students and just not the sort of place where you want to raise a child if at all possible. So, I decided to find a single-family home and moved a little bit farther away from the university and found a job that was 30 hours a week, in addition to graduate school, that would pay a little bit more. So I went from making probably around $20,000 to making about $40,000 overnight. Which at the time felt very luxurious.

12:31 Emily: Wow, I don’t know that I’ve interviewed anyone else who’s made that kind of decision. So you took a 30-hour per week job. Does that mean you gave up the job you had, like if it was an assistantship, or how did that work combined with the, you know, the funding of graduate school?

12:46 Sarah: Yeah, that’s an important nuance. So, in the first two years of my PhD program, we were guaranteed some sort of position that would include a stipend. So that was a research assistantship or a teaching assistantship. And then a lot of students find a fellowship that will, you know, a pre-doctoral fellowship that will cover the cost of their schooling, their dissertation writing. And I had applied for maybe one or two, maybe it was even just one fellowship, didn’t get it, and was really worried. Like, what am I going to do next? And so I emailed faculty who were doing research in my area and they didn’t have any funding. And so I emailed the chair of the department and said, here’s my situation. Do you have any suggestions? And she said, actually there is a coordinator position for the reaccreditation of the school of public health. It is 30 hours a week. It is a real 30 hours a week. So it’s not like an assistantship where you might work, you know, 10 hours one week, you know, 25, the next. It was going to be a full 30-hour week position, but it made double what I did before. So that’s how I ended up in that position.

14:00 Emily: Okay. And was your funding still, that is for like the tuition and fees and so forth, was that still provided by your program?

14:08 Sarah: Yes, it was.

Housing Expenses and Saving on Childcare 

14:09 Emily: Okay. Yeah. That’s, that’s really interesting. Of course I know sometimes people who get into the ABD stage have different work arrangements, but I’m really glad to hear how that worked out in particular for you. Okay, so you’re making more money but you have the child, so what’s the next stage in the finances?

14:26 Sarah: Yeah, so we had bought this house and it was very inexpensive and I think it felt comfortable because where I live in North Carolina, really, the market is such that it was as affordable to buy a home as it was to rent a home. And that way, you know, I was building equity and I, you know, I had been for teaching spin classes on the side just to kind of make some extra money and fill in gaps for fees, for example, were not covered by the tuition remission. Which, you know, sometimes they were like $700, nothing to sneeze at. So my partner did start making a little bit more money, but in the meantime there was a gap where he wasn’t making very much money. So we, again, were just really trying to keep things as inexpensive as possible. So one of the decisions I made, it was primarily for kind of personal reasons, but also financial. I had minimal childcare, which was pretty stressful because I was doing, you know, my dissertation, I was working 30 hours a week, and I had an infant. But it was important to me to kind of keep things as limited as possible in terms of expenses and childcare is extremely expensive around here. Probably no more expensive than elsewhere, but it was like a second mortgage to have full-time childcare.

15:56 Emily: Yeah. I was going to ask you about that next because yeah, childcare is, I’ve definitely spoken with other graduate students who have, because the flexible schedule, like tried to make it work and not having at least full-time childcare, maybe just part-time or something. How do you feel about that decision now?

16:14 Sarah: You know, I have reflected on it because I do know of graduate students who have children who have gotten childcare. And in retrospect, I do wish I had given myself the grace of having a little bit more help than I did, because it was just a lot. I remember being extremely sleep deprived. I don’t regret anything because I really savored that time with my daughter, but it was stressful in a way that I don’t think I would want my child to do for themselves if they were in that situation. So I think I probably would have taken out a loan and, you know, if I could have understood that I would be making an amount of money in the future and really taken that into account and would be able to pay off a reasonable loan, I probably would have done that.

17:09 Emily: Yeah. I’ll link in the show notes to another episode where I interviewed a graduate student who is currently taking out student loans for daycare and also side hustling and doing all the things on top of it. Do you feel like you still finished in good form or maybe you took a little bit longer or how do you think that worked out?

17:26 Sarah: You know, I took three years to finish my dissertation. So, it was two years for the master’s program, two years for the predoctoral coursework, and then three years of writing my dissertation. And honestly, I think, you know, a lot of people finish their dissertation in two years in my program. For me, I think it was less about having a child and more about like data issues as, you know, these things go. But yeah, I felt like I was in a pretty good position when I graduated.

Decision to Do a Postdoc After Grad School

17:58 Emily: Okay. And so you did a postdoc after graduate school, is that right?

18:01 Sarah: Yes, I did a postdoc, but I did go on the job market in a very limited way, mostly because I wanted my dissertation chair to read my dissertation. And I knew that if I were on the job market, he would read my dissertation, and it worked. And so I very seriously considered a faculty position that I was offered. And the salary that was offered, it was a nine-month tenure-track faculty position. And I was considering also two different postdocs that I had been offered in North Carolina. The faculty position was outside of North Carolina. And you know, postdocs didn’t make, there was one postdoc that made not terribly far off from the faculty position. And then another post-doc that was just very little money. It was a T32 and it had no research support. And the postdoc that I ended up taking, it was an R25, which at the time you could do a post-doc, they funded them that way. And it was a much more generous salary than the T32. It had research funding. I hadn’t even been counseled about thinking about a startup package for a faculty position. And I don’t know if that was on the table. I’m not sure I remember, I don’t remember talking about it. And so again, in retrospect, it was really smart of me to take the generous post-doc that had research funding that had a little bit more generous salary than the other one. And I did that for three years. And for each of the two years subsequent to the first, I got a $5,000 raise.

19:43 Emily: Yeah, not bad. It’s very curious though, because you don’t hear about people turning down tenure-track positions too often. So what was it that tipped things in favor of doing the postdoc?

19:53 Sarah: Primarily, my partner was not super excited about moving, and I felt like I wanted to make sure that he was comfortable with our next life stage, our next, you know, career decision. And also I did get advice from somebody at the institution where I had gotten the tenure-track offer that I should do a post-doc. And part of that, I think for her, the reason she recommended that was because I would have time off of the tenure-track clock, the tenure clock to publish, to get some preliminary data for a career development award. And so taking those things together, it was a pretty clear decision.

20:40 Emily: So, your idea then at that point was to go on the job market again, after the conclusion of the postdoc and be a stronger position for winning funding and getting a position at that time.

20:51 Sarah: Exactly.

Sarah’s Finances and Money Mindset During the Postdoc

20:52 Emily: Gotcha. Okay. So let’s talk about the finances during the postdoc. How much were you making approximately at that time and you know, what was going on?

21:00 Sarah: So, I started at, I want to say $50,000, which is pretty good for a postdoc back in 2011. And then the next year I made 55 and then the final year I made 60, which was really pretty sweet.

21:16 Emily: Yeah. That raise schedule is, yeah, that’s pretty good.

21:19 Sarah: Yes. I finally felt like I was able to breathe a little bit. I mean, I wasn’t exactly like going on fancy vacations and buying a new car which, you know, I hadn’t done. I think, you know, my husband and I went on our very extravagant honeymoon. We went to New Zealand six months after we got married. But other than that, we really weren’t doing anything extravagant. I was driving the same car I had gotten right after college which was used anyway. And so, I think that I just was able to feel like I didn’t have to scrimp and save at every turn making $60,000 a year, which is pretty good.

22:02 Emily: Yeah. And regarding, you know, your child as well, how were you spending money in that respect?

22:09 Sarah: And at this point, I had two children. So in October of my first year of the postdoc, three years after my first child was born, I had a second child. And so, at this point, my daughter was in preschool about half-time. And then my son, I stayed home with exclusively for quite a while, maybe six months, again, kind of fitting my work around the edges, having a little bit of in-home daycare. Somebody would come into my home and watch him while my daughter was at preschool and I would get some work done. And I was doing a lot of work at night and on the weekends.

22:51 Emily: Yeah. So, you had your full-time job, but it was fit into the margins around the children’s schedule.

22:57 Sarah: Exactly. It’s the double-edged sword of that flexible job situation. And I don’t do bench science, so I really was on my own schedule for the most part.

Retrospective Reflections on the Affordability of Childcare

23:07 Emily: Yeah. And I’ll ask you the same question again. How do you feel about that arrangement now, looking back on it?

23:13 Sarah: I mean, I think I’d probably give you the same answer, that first of all, I probably could have afforded more childcare. Particularly once I was making, you know, above $50,000, I probably could have done it. It would have been a little bit tight, but I could have afforded it. Again, it was kind of my own personal comfort level with how much I wanted to be away from my children, but it also was, I just was so used to living as restrictively as possible. It didn’t even occur to me to get more help because I just operated as stringently as possible, but I didn’t have to. And if I had taken a little bit more time to really understand my finances, my cashflow, I’m very lucky. I didn’t have any debt from college. My parents paid for college. I didn’t have any debt from graduate school, aside from my house. I didn’t have any huge responsibilities, liabilities, so I probably could have afforded it. And if I had really examined my finances, I would have seen that.

24:22 Emily: Yeah. I’m asking these questions because I was in a similar period. So I have two children. They’re four and two right now. And in their very young years I was self-employed. And so I had this wonderful flexibility. And so I also didn’t employ as much childcare as I could have, and we sort of slowly dipped our toe into more and more childcare as they got a little bit older. And then the pandemic took the childcare away, and I really, really miss it. So that’s kind of my perspective on this. It’s like, yeah, I could have done a little bit more with that and been a little bit more focused on my work. And maybe for my business, you know, maybe gotten things ramped up a little bit faster than they had been. But, you know, like you said, also, like not regretting having the time with the children because that’s wonderful, but yeah, I’m just curious now for, I know, obviously there’s, you know, younger listeners maybe still in graduate school, maybe they haven’t had any children yet. Just trying to think through these decisions. I think it’s useful as you do on your podcast to talk through the issues that people face as they’re juggling career plus, you know, caregiving for family members and so forth.

25:24 Sarah: Yeah. And I think the bottom line is, you know, it is an intersection of personal values, finances, aspirations for what you want to do with your money, and just understanding all of those fully is going to position you best to make the right decision.

Commercial

25:47 Emily: Emily here, for a brief interlude. Taxes are weirdly, unexpectedly difficult for funded grad students and fellowship recipients at any level of PhD training. Your university might send you strange tax forms or no tax forms at all. They might not withhold your income tax from your paychecks, even though you owe it. It’s a mess. I’ve created a ton of free resources to assist you with understanding and preparing your 2020 tax return, which are available at pfforphds.com/tax. I hope you’ll check them out to ease much of the stress of tax season. If you want to go deeper with the material or have a question for me, please join one of my tax workshops, which you can find links to from P F F O R P H D S.com/T A X. It would be my pleasure to you save time and potentially money this tax season. So don’t hesitate to reach out. Now, back to our interview.

Retirement Savings, Directed Gift-Giving, and Coaching

26:52 Emily: So, let’s also talk a little bit about what financial practices did you have? Because you were saying you weren’t super aware of your cashflow during that time. You didn’t really examine it. So, were you budgeting? Were you saving? What was going on?

27:05 Sarah: Yeah, so by this time my partner was a personal financial planner, which was extremely convenient. He had always been really interested in personal finance. And so, you know, early on I had been, even when I worked at the community health center, I maxed out my retirement savings or contributions and didn’t have that option as a graduate student, no benefits there, but we certainly were saving as much as we could. Just a little bit here and there. But I was not a participant in that decision by my own, kind of, I guess it was more passivity than it was a conscious decision that I didn’t want to be involved in that. And so, I think for me, I just had so little perspective on any of our cashflow. But we had set up 529 plans for each of our children before their birth. And that was something that we started to ask anybody who wanted to give presents to just contribute to 529 plans. So, these were the kinds of things that we were starting to do that would make things a little bit easier and asking for things like, instead of stuff, like memberships to museums and things like that.

28:18 Emily: Yeah, I like that directed gift-giving, the nudges, that’s a good tip for any future parents. Okay. So, any more that you wanted to say about that postdoc position?

28:28 Sarah: I did work with a professional coach when I was trying to make a decision about kind of what I wanted to do towards the end of the postdoc in terms of my next steps. And one thing she encouraged me to think about was that there are all types of currency, and salary is just one of those. You know, benefits are just another component, but flexibility, anything really that you value as a human, you know, personal happiness, contentment in your relationship, proximity to family, be that far or near, depending on what you want. These are all important forms of currency. And that was kind of my orientation as I sought another position following my postdoc.

29:15 Emily: Yeah, that sounds like a really great exercise to go through when you’re at that point of deciding where you’re going to go next in your career. Is that something, an exercise you would recommend to others?

29:25 Sarah: Oh my gosh. Yes. Literally writing it down. I think just making all of those things as explicit as possible. Again, in the vein of really having clear picture of all of these things. Now, still at this point, I didn’t have a clear picture of my finances, but at least knew that that was a consideration that I had to account for.

Sarah’s Half-Time Research Track Faculty Position

29:50 Emily: Yeah. So, you went on the job market again, and where did you end up?

29:55Sarah: Well, so I didn’t really go on the job market. One of the major values that I pulled out of my experience with the coach was that I did want to stay home part-time with my children. I really liked being home part-time and I liked kind of being able to be with them as much as possible while continuing to do my research. And so, I basically worked with a mentor who was in a powerful position to design a half-time research track faculty position. Again, this was a huge compromise in terms of, you know, just financial benefits because it was half a salary, it was no benefits. So I forewent retirement savings aside from any personal contributions, which I did make, and, you know, was on my partner’s benefits which was stressful because he worked for a very small firm. Health insurance was very limited and expensive, but that was a conscious decision on my part to forego the benefits, you know, real and kind of personal, associated with the kind that I would get in a full-time position.

31:10 Emily: Yeah, I think, so I also work part-time now because I can design my own schedule. I find it to be great. And I think a lot of people wish that they could negotiate for that kind of, like still keep their career going, maybe a little slower speed than before, but still on some kind of track while having a lot more time for their own stuff, for their own families or whatever it is that they’re doing. How long were you in that part-time role?

Transition to Full-Time Contingent Faculty Position

31:37 Sarah: I was in the part-time role, I want to say, for maybe a year and a half or two years. And then I sought a position elsewhere because I was ready to work full-time, and it didn’t seem like that was going to be an option at UNC in my department. And so I did get an offer for a full-time position at another institution. And as you know, the chips fell, I was offered a full-time position at UNC in the same department where I was. It was still research track. So I was completely contingent, which means that I ate what I killed. If I didn’t get a grant to cover my salary, I wasn’t going to get a salary ever or a full salary. So that was stressful. But I was taking into account, frankly, a couple of things. One was the kind of intellectual freedom that I would have being in this, even though it was not a tenure-track faculty position, I had the intellectual freedom to do investigator-initiated research. Another consideration was, I was just scared, basically, to do something new or to think about what else my career might look like. I was kind of already on a path, and it was frightening to me to think about doing something different.

33:08 Emily: I see. So, were you at UNC that entire time, or was your postdoc at a different institution?

33:13 Sarah: No, my postdoc was at UNC and its Cancer Center.

Sarah’s Finances During Full-Time Faculty Position

33:17 Emily: I see. I think you’ve talked about on your podcast about the relative of merits of staying at an institution, right? The same institution where you did your graduate work. So yeah, I’d love it if you could give me an episode and I’ll link to it in the show notes for like further discussion about that. For our purposes, now you have this full-time role. You know, you’re going after your own grants, but you get to set your own salary. What do you want to say about the finances during that stage?

33:45 Sarah: I have to say that it was a kind of delay cognitive shift, because I doubled my salary overnight and I was still functioning as though I made half of my salary. And, you know, I really, because I had never confronted or taken the time or the initiative to closely examine my finances, I couldn’t adjust my thinking around finances or how I spent my money. Again, my M.O. was just make as much as possible and spend as little as possible. And I think that, on the one hand, that continued to work out relatively well, but on the other hand, it meant that I was really deferring to my partner for all things, all financial decisions. And I do not recommend that. I cannot overemphasize, and I remember sitting down with a financial planner who helped my partner and me before we got married.

34:50 Sarah: And she said, you need to focus on this. You need to pay attention. And I, honestly, where my brain was was to say like, I’ll figure it out when I need to. Like, right now, I’m overwhelmed with everything I have on my plate. And I don’t want to think about it. There was nothing anybody could have said to convince me to pay more attention to it until I was ready, which is kind of my personality anyway. But at this stage, it’s much harder to wrap my head around things because things are much more complicated. And I would like to think that if I had started earlier and focused when things were simpler, I would be able to keep up a little bit better now. Now that I really am taking the bull by the horns, I am able to get my head around it. I’m happy to say I was right. You know, I need to figure it out now and I am figuring it out, but it’s much more complicated than it would have been, say, when I was in graduate school.

35:50 Emily: I think that’s a really, really great message for the people listening who are starting their adulthood, right? And I actually have, not about finances generally, but I kind of say the same thing about taxes, actually. Like when you start understanding how your tax return works and how income tax operates when you have a simple income, a small income, you know, no assets, no house, no all this complexity that can come like later on, as your financial life gets more complicated, your taxes also get more complicated. And so I can definitely see how, yeah, if you were deferring this work to your partner for all those years now, suddenly you open your eyes and you have this wonderful paying job, but you’ve got the two kids and you have all the different, you know, aspects of your finances that are going on. I can definitely see how it could be certainly overwhelming, but I’m really glad to hear that you’re finally, you know, deciding to take charge of it. So definitely the advice is pay attention when it’s small and, you know, your knowledge will grow as your finances become more complicated. Yeah.

36:52 Sarah: Absolutely.

36:54 Emily: Is there anything else that you want to say about your finances during that period when you were still at UNC, but at the full-time role?

Negotiating Salary as Research Track Faculty

37:01 Sarah: The only kind of negotiating advantage one has as a research track faculty member is that the institution is not on the hook at all for the money that they’re paying you. Because it’s not them paying you. It is completely grant funding. And as a non-physician research scientist, there is no amount that, you know, if I were a physician and I made over the NIH cap, then sure, the institution would have been on the hook for the remainder, but that wasn’t the case for me. So, that was something where I didn’t feel like it was asking too much. So, I did kind of push that a little bit more than I would have otherwise when I was negotiating that retention package.

37:53 Emily: Because as you said earlier, you’re completely funding your own salary. Plus, the research expenses, the lab, whatever it is, well, you said you weren’t lab-based research, but whatever it is that you’re funding costwise.

38:01 Sarah: Right, exactly.

38:02 Emily: Yeah. So, what I’m taking that to mean is that you can set your own salary, but there’s some input from the institution and you don’t want to shoot too high because then you’re running through the grant money more quickly. Is that right?

38:13 Sarah: I mean, that is a consideration, although you kind of put in for a percent effort, but that will eat up the research budget a little bit. That wasn’t something I thought of too much, just because I think the kind of incremental chunk of the overall budget that my salary would take up, you know, a $5,000 increase in my salary, isn’t going to blow my budget.

Sarah’s New Tenure-Track Position at Wake Forest

38:40 Emily: Gotcha. Let’s talk about your new position now. What prompted you to go for it and be willing to leave UNC?

38:49 Sarah: Oh my gosh, it was such a process, but I had a career development award. That is how I funded 75% of my salary for the time, the three years that I was in a full-time position. The other 25% was made up of teaching and other kind of co-investigator positions. And as I near the end of my career development award, you know, the writing was on the wall. I was going to have to, you go from 75% of your salary being covered to, you know, whatever you can pull in with grants. And after your career development award is over, as a, you know, an academic researcher. You’re never going to have a grant that’s going to cover that percent of your salary again. It’s just, you know, you might, if it’s a really generous project, you might get 25%, but usually it’s more on the order of like 10, 15, 20% of your effort.

39:47 Sarah: And that means that you’re on a lot of projects. And funding being what it is, it did not seem like something that was viable for me in a research track position, being able to pull in enough money to support the lifestyle that I had come, you know, again, I was still not spending a ton of money. But, you know, we moved from a smaller house to a bigger house. We had bought a new car by that time. These are things that do add up and, frankly, I wasn’t excited about making half a salary anymore. And, you know, one of the things that happened when I was on faculty was I just wore, in graduate school and for the postdoc, I really just more whatever clothes I had and I just didn’t really care. And something happened and I was like, I love clothes. And I still only buy used clothes to the extent possible. I really am like a big consignment person, but still, these are kind of the orientations that shifted a little bit. So.

40:58 Emily: I want to actually interject there because I think it’s, again, I’m so pleased to speak with someone who’s a little bit further on in their career, because I think this is a great perspective to have that the lifestyle sacrifices that you are willing to do in your twenties might not be ones that you’re willing to do later on. Now, of course, within personal finance, there’s this FIRE movement and there’s lean FIRE, which is, you know, keeping your lifestyle capped at this really low level. And you expect to live on that in perpetuity, maybe for a subset of the population that is acceptable. But I think most Americans on average kind of want to spend more as they, you know, advance through their lives. They grow accustomed to certain comforts and little luxuries that they want to keep around. So, I think that’s a perfectly reasonable perspective. It’s something I’ve observed in myself as well of, yeah, growing to like a little bit more spending once it’s available and not wanting to backtrack from that.

41:53 Sarah: Yeah, exactly. Yeah. And so, you know, going through a tenure-track position was, in some respects, kind of just a psychological shift. I knew that I could probably find a position that would have some startup, which would cover a part of my salary and kind of the percent coverage that I would have would decrease over time. This is kind of the way things go in my field. But that psychological comfort of knowing that I didn’t have to pull in a hundred percent of my salary based on grants was enough to pull me away. And it was time for me to find a position that felt more secure. So, really it was just psychological. I am in a soft money position now, but I like to call it, you know, semi-firm because it is, you know, my startup package was such that I started out with 90% of my salary funded and then it will decrease over five years to 65% of my salary I need to pull in from outside. And my thinking was, if, you know, I’m five years into a tenure-track faculty position and I can’t pull in 65% of my salary, then I probably shouldn’t be doing the kind of research that I’m doing. There’s a little bit of wiggle room because there are lean years, but I feel like I should be able to do that. So, it felt very fair.

43:27 Emily: Interesting. Yeah, this is, it’s kind of a lesson in like betting on yourself, I guess, that you’ve gone through. That is to say, you’re giving yourself a little bit more time for that transition by getting your salary covered again, but you’ve just sought out the structure within academia that makes you feel comfortable at any given time. I really love this lesson about like negotiating for what you want. Like when you did the half-time position, then, well, you phrased it as if it fell into your lap, but somehow you managed to get that to be a full-time position. So, presumably there was some kind of negotiation going on there, or at least going after a position. Yeah, I really like how you’ve been kind of flexible and gone with what you want and what you feel comfortable with, through these you know, through this arc of your career. Is there anything else that you want to say about negotiating that startup package?

Negotiating a Startup Package

44:13 Sarah: Yeah, I mean, I think it’s important to acknowledge a couple of things. So, one is kind of a small thing, but it was really important. When I was a postdoc, I attended a seminar given by an expert in negotiating. And one of the things I remember from that was, you know, well, two things I remember from that, one was start with a win. And the other thing was, you know, you can be honest about what you’re hoping for in terms of the outcome. And so when I was faced with the opportunity to negotiate, because I had been offered a position, I took those things to heart. So, I knew that I wanted the position. And so I didn’t, you know, make any effort to suggest otherwise. I said, I really want this to work out. I’m looking forward to finding a way that we can make that happen so that we’re both happy. And I think that was true and it was nice and it made for a really comfortable negotiation.

45:15 Emily: Yeah. You’re sort of establishing from the beginning, like we’re going to be working together. So let’s make this a pleasant process and both get something that we want here.

45:24 Sarah: Exactly. And, you know, I think I had very different expectations about what the salary was going to be, not very different, but sufficiently different, that that was one of the things that I wanted to negotiate. And we came to a place that we were both happy with. And the startup package made up for kind of any, you know, difference between what I kind of thought the salary was going to be versus what it was. And I certainly came out of the negotiation feeling really good about where things landed. And I think my chair did too.

45:58 Emily: Yeah. I think that’s the best kind of outcome is that you, it’s actually something that I like to say about discussing finances generally is that you, you learn a lot about another person by sort of exposing your values through discussing how you handle your money and what your aspirations are and so forth. And this the same kind of thing could happen through negotiation. My husband actually was in, it wasn’t a negotiation, but it was a performance review recently. And he was asked by his supervisor, well, what motivates you? Is it more salary? Is it more something else? Like what’s going to really, you know, get you to do great work for us? I thought that was a great question, you know?

46:34 Sarah: Great question.

What Motivated You to Face Up to Your Finances?

46:34 Emily: Yeah. Is there anything else that you want to add about, you know, finances through this arc? Do you want to talk about what motivated you to finally face up to your finances and do that whole process?

46:48 Sarah: You know, I turned 40 this year, last year. And I think with taking on a new position, really, it was, I mean, I should emphasize what a big deal it was for me to leave UNC. I like control. I like being able to anticipate what things are going to be tomorrow. And for me to take the leap to leave an institution that I had been at for five years as a faculty member for three years as a postdoc and for seven years as a graduate student was huge. Huge. Especially since I had had several opportunities prior to that to leave and I hadn’t. So, I think, you know, a combination of turning 40 and having succeeded in shoehorning myself out of my comfort zone and, you know, emphasis on the succeeded. Because I really did succeed.

47:47 Sarah: I got exactly what I wanted. That empowered me to be like, Oh, I can do this. Like I’ve got skills, I can handle this. So, and I, you know, I now work with, and there’s a website called Personal Capital that I use and I’m working with a financial planner through them and just getting a hold of the basics. I think I’ve just come to recognize that I have skills, and I’m smart. And I just need to approach this in a really pretty straightforward way of like, I make money, I spend money. I should be able to know what those things are and have a full picture. And I owe it to myself to have that full picture. And hopefully all of the kind of, you know, considerations I have when I look back at my trajectory, I can think that moving forward, I’m going to have a much clearer picture and I will be able to make decisions that are fully informed.

Best Financial Advice for Another Early-Career PhD

48:52 Emily: I’m so glad that you’ve come to this point. And isn’t it fortuitous that I asked you to come on the podcast right at the same time as you’re going through this personal journey as well? You have a new lease on your financial life now. It’s wonderful to hear. So, Sarah, as we wrap up, the question that I ask all my guests is what is your best financial advice for another early-career PhD? And that could be something that you want to emphasize that we’ve already touched on, or it could be something completely new?

49:17 Sarah: Well, I mean, I guess I’ll just double down on the idea of, I think if I could go back and tell myself it would just be, for me, I like things as simple as possible. I would just break out a spreadsheet and put in my income and start tracking my spending. Like that’s pretty easy. It really is. And it’s really easy now with all the apps. And I think that just doing that is a first step. And then you start to get curious, like, okay, well, what do I do with the gap between what I make and what I spend? Okay, I got to do something about that. Or what do I do if I have a little extra? What can I do with that? And it kind of can be a natural progression.

50:02 Emily: I think that’s exactly right. I’ve heard that from other guests as well. And it’s something I went through myself is just that very first baby step is just to start tracking. Just to write down what’s going on, and then you don’t have to push yourself to start budgeting or do anything complicated right away. Just start observing what’s going on. And then as you said, you’ll become curious, you’ll naturally start to make changes. Yeah, I think that’s wonderful advice. Well, thank you, Sarah so much for this interview. It’s so fascinating to learn about, you know, the arc of your career and how your finances have changed through all of that as well.

50:30 Sarah: This has been lovely. Thank you so much for inviting me.

Listener Q&A: Taxable Fellowship and Scholarship Income

50:38 Emily: Now, onto the listener question and answer segment. Today’s question was asked during a live tax webinar I gave recently for a university client. So, it is anonymous. Here is the question. Quote, “How does the IRS verify the amount of taxable fellowship and scholarship income that we report on our form 1040?” End quote. I love answering questions during live events, and I especially love questions like this one that are completely unique. I’d never been asked this one before. It sort of goes to this fundamental thing about income tax in the U.S. which is that the IRS does not necessarily know in advance what your tax liability is. You are really telling the IRS what it is through generating your tax return. So there’s a lot of individual responsibility there, and there’s also kind of a lot of, you know, trust on the IRS’s that you are doing a good job at reporting, you know, your income and your expenses and so forth accurately. That is, unless they decide to audit you. Anyway, that’s pretty unlikely for a grad student.

51:39 Emily: So, to give you some context for this question in the workshop, I talk a lot about how to track down all of your income sources as a graduate student and also all of your qualified education expenses. Now, if your university issued you a form 1098T, you would think that that 1098T would be a complete record of those two things, but it is not. I emphasize in the workshop that it’s very common for graduate students to have additional qualified education expenses not listed in box one of the 1098T that they can use to reduce their taxable income, and therefore, ultimately, their tax liability. So, the question is basically asking, well, if my taxable scholarship and fellowship income is not simply box five of the 1098T minus box one of the 1098T, how does the IRS know that I actually have those expenses?

52:32 Emily: Or how does it know that I did my math right on the subtraction? And my answer, at least for U.S. citizens and residents, is that the IRS doesn’t really know what went into calculating that taxable scholarship and fellowship income, at least when you first submit your tax return. All you’re reporting is that net number, the taxable fellowship and scholarship income. You’re not putting on your tax return anywhere your total scholarship and fellowship income and your total qualified education expenses, only the net of those two. So, in that tax return, you’re not showing the math, right? You’re only showing the answer. However, my firm suggestion is that you keep your notes on this process. Keep the receipts. Keep the records of all the qualified education expenses and so forth. Because while unlikely, it is possible that the IRS may come back to you and say, Hey, we don’t understand where this number came from of your taxable scholarship or fellowship income.

53:31 Emily: What is it? What went into this calculation? And then you’ll be able to show how you did the math there. It’s not something you have to submit in your initial tax return, but it is very handy to keep around for several years in case the IRS does question your return. By the way, that’s not necessarily a full formal audit. It could just be something that you respond to in a brief letter or over the phone. I’ve actually coached several graduate students through something similar to this process where the IRS didn’t understand how they were reporting their grad student income. And they were able to, you know, write a coherent letter, justifying it, and the issue was put to bed. So I loved answering that question in the live webinar. I’m glad to have been able to replicate that for you here. By the way, there are two ways that you can get more of this kind of tax info in your life.

54:17 Emily: One is that you can join my tax workshop, which is called How to Complete your Grad Student Tax Return (and Understand It, Too!). You can join that as an individual, or actually you can even make a bulk purchase. Like if you want to arrange that through your department or grad student association or something. You can find out more details about the tax workshop at pfforphds.com/taxworkshop. I am also available for live events. Believe it or not in previous tax seasons, I have been booked late in March to give an event actually that was in-person that year in early April. So, if you want to bring this kind of material to graduate students and even postdocs broadly within your university, please just email me, emily@pfforphds.com, to kind of get the ball rolling on that. If you would like to submit a question to be answered in a future episode, please go to pfforphds.com/podcast and follow the instructions you find there. I love answering questions, so please submit yours.

Outtro

55:21 Emily: Listeners, thank you for joining me for this episode. Pfforphds.com/podcast is the hub for the Personal Finance for PhDs podcast. On that page are links to all the episode show notes, which include full transcripts and videos of the interviews. There is also a form to volunteer to be interviewed on the podcast and instructions for entering the book, giveaway contest and submitting a question for the Q&A segment. I’d love for you to check it out and get more involved. If you’ve been enjoying the podcast, here are four ways you can help it grow. One, subscribe to the podcast and rate and review it on Apple Podcasts, Stitcher, or whatever platform you use. If you leave a review, be sure to send it to me. Two, share an episode you found particularly valuable on social media, with an email listserv, or as a link from your website. Three, recommend me as a speaker to your university or association. My seminars cover the personal finance topics PhDs are most interested in, like investing, debt repayment, and taxes. Four, subscribe to my mailing list at pfforphds.com/subscribe. Through that list, you’ll keep up with all the new content and special opportunities for Personal Finance for PhDs. See you in the next episode! And remember, you don’t have to have a PhD to succeed with personal finance, but it helps. The music is Stages of Awakening by Podington Bear from the free music archive and is shared under CC by NC. Podcast editing and show notes creation by Meryem Ok.

This Two-Time International Graduate Student Gives Excellent Advice to Her Prospective Peers

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In this episode, Emily interviews Josephine Shikongo-Asino, a second-year PhD student at Oklahoma State University from Namibia. This is Josephine’s second stint as an international graduate student in the US, having completed a Fulbright fellowship about ten years ago. She has great advice for prospective and rising international graduate students in the US about the financial transition into graduate school. Josephine and Emily discuss funding models, the importance of saving and debt reduction prior to matriculating, researching cost of living, visa restrictions on working, credit and debt, budgeting, remittances, and more. Josephine’s excellent advice nearly always applies to prospective and rising domestic graduate students as well; this episode is for everyone!

Links Mentioned in this Episode

international grad student

Teaser

00:00 Josephine: If anyone is considering to come, I would say before you hand in that resignation letter, really do an inventory analysis in terms of your financial needs and maybe also pay off any loans, if you can. If you have any loans, you can pay them off. If you have a car, sell it, you weren’t needed at least for a year. So yeah, that’s really doing a financial inventory to make sure that you are in the right place.

Introduction

00:34 Emily: Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. I’m your host, Dr. Emily Roberts.

00:42 Emily: This is Season 8, Episode 5, and my guest today is Josephine Shikongo-Asino, a second-year PhD student at Oklahoma State University from Namibia. This is Josephine’s second stint as an international graduate student in the US, having completed a Fulbright fellowship about ten years ago. She has great advice for prospective and rising international graduate students in the US about the financial transition into graduate school. We discuss funding models, the importance of saving and debt reduction prior to matriculating, researching cost of living, visa restrictions on working, credit and debt, budgeting, remittances, and more. Josephine’s excellent advice nearly always applies to prospective and rising domestic graduate students as well; this episode is for everyone!

01:32 Emily: It’s always a pleasure for me to create content for international graduate students, postdocs, and PhDs with Real Jobs, and I’m really grateful to Josephine and everyone who has donated their time to help me and my audience learn more about how to navigate finances while in the US on a visa.

01:48 Emily: Some other episodes in which I’ve covered this topic are S4E17 Can and Should an International Student, Scholar, or Worker Invest in the US?, S2E6 Making Ends Meet on a Graduate Student Stipend in Los Angeles, and S6E3 The Financial Hurdles of Moving to the US as a Postdoc.

02:08 Emily: I’m actually working on some tax content specifically for international graduate students this spring, so if you aren’t already on my mailing list, please join to hear more! You can do so at PFforPhDs.com/subscribe/.

Giveaway

02:21 Emily: Now it’s time for the book giveaway contest! In February 2021, I’m giving away one copy of The Simple Path to Wealth by J L Collins, which is the Personal Finance for PhDs Community Book Club selection for April 2021. Everyone who enters the contest during February will have a chance to win a copy of this book.

02:42 Emily: If you would like to enter the giveaway contest, please rate AND REVIEW this podcast on Apple Podcasts, take a screenshot of your review, and email it to me at emily@PFforPhDs.com. I’ll choose a winner at the end of February from all the entries. You can find full instructions at PFforPhDs.com/podcast/.

03:03 Emily: The podcast received a review this week titled “Crucial knowledge for a first year PhD student”. The review reads: “I started listening to this podcast a couple months ago, and the tricks I have learned have increased my confidence in personal finance has tremendously. As an international student. Not all advice work for me, but I especially enjoyed episode two in season eight, when Laura was sharing her experience as an international student. In general, this podcast have taught me to manage my new monthly stipend the best way. I now know that it’s okay not to prioritize paying down my student loans, I’m not crazy to be checking my bank account on a daily basis, in fact, it’s encouraged, and I’m now putting together a 50/30/20 budget. My goal is to one day be managing my personal finances in a way that I could be a guest on Dr. Robert’s podcast”.

03:51 Emily: Thank you for this a wonderful review and I can’t wait to have you on the podcast without further ado. Here’s my interview with Josephine Shikongo-Asino.

Will You Please Introduce Yourself Further

04:02 Emily: I am delighted to have joining me on the podcast today. Josephine Shikongo-Asino. She is a second year graduate student at Oklahoma State University. And she’s here to talk with us about international students and their transition to the US, particularly the financial aspects of their transition. This is a subject I’m highly interested in. I hope you are as well. I’m interested in for all types of graduate students, both domestic in the US and international, but I’m really, really happy to have the focus on international students on the podcast today, because it’s a group that is highly in need of more information about this. So Josephine, I’m really pleased that you suggested this topic and that you’re joining me on the podcast today. Will you please tell the audience a little bit about yourself?

04:42 Josephine: Thank you, Emily. Thank you for having me. I’m Joseph Shikongo-Asino. I am originally from Namibia, which is in Southern Africa. We are just above South Africa. I’m sure many people know where that is. My background — I’m a certified accountant. I have a master’s in strategy as well, which I did here in the US. And then I’ve spent about 10 years working in the financial sector, including financial services, banking, and investments. But currently I’m a second year PhD student at Oklahoma State University with my research interests, really more on higher-ed finance and policy.

05:20 Emily: Wow. What a great fit for this podcast. I’m so glad you’re joining us. And between your master’s and starting your PhD, did you stay in the US that whole time, or did you live back in Namibia, or elsewhere?

05:31 Josephine: No. I had to go back home because with my master’s, I was sponsored by the Fulbright program. They require you to work two years at home once you finish your program so that you can give back, which is the purpose of the Fulbright program. I had to serve two years in my country and then come back to proceed with my PhD.

05:49 Emily: Gotcha. So you really have the perspective of having transitioned into the US twice?

05:54 Josephine: Yes.

Similarities and Differences Between Finances in Home Country and the US

05:54 Emily: Perfect. So tell us a little bit about, maybe before that first time that you came to the US, a little bit more about the finances in your home country, and how they are similar or dissimilar to the US.

06:07 Josephine: Namibia is classified as an upper middle income country by the World Bank. So it is actually, one of the better performing economies on the continent. And even when I came here, I realized that there’s not much of a difference in terms of salaries back home and being in the US, other than currency exchange, obviously. But, because I had to quit my job, I did not have a backup, I did not have any cushion, that could keep me in case something happens. In case I have an emergency, I did not have, um, any backup. And also because I’m coming from a low income family, I did not have any other backing, other than the sponsorship, which I go through the Fulbright program. I really had to do to survive on my own. I took a decision to leave my job because I thought that I would come to a better situation, which will give me better opportunities afterwards. Looking back, maybe I would have made a different decision after the two years were over. I don’t know if I would have necessarily quit my job had I known what I was signing up.

Advice for Prospective International Grad Students

07:24 Emily: I see. Okay. So I think we’re going to get a little bit more of those stories as the interview proceeds. First of all, you just mentioned that you quit your job, no savings, no backup before you came here. What’s your advice for another international student planning to come to the US? We’re recording this in December, 2020. I think it will be out sometime in the early spring, so people are receiving decisions about their admission to grad programs, but they still have a bit of time before they actually need to matriculate. What is your advice for that time period?

07:59 Josephine: I think the first question really is can you afford to quit your job. For me, that’s the first question you should ask yourself. Do you have expenses such as maybe dependents at home that depend on you on you solely, financially? Do you have a home loan? Do you have a personal loan, that needs continued financing from you?

08:20 Emily: Okay, so you mentioned paying off debt earlier, but what about generating savings? You know, I imagine a degree of savings is helpful for anyone who is moving, but more so when that move is international. So can you speak to that a little bit?

08:34 Josephine: Yes. I mean, most people plan their international studies way ahead before they happen, because you even go through the process of first researching the institution’s, researching where to go. So when you start thinking about going to study internationally, I think you should start at nest. You should start putting money that you can have in case, even if you don’t get a full tuition waiver, even if you don’t get a full scholarship, to have something that you can either supplement yourself, or you can just supplement your expenses, or you can keep paying off the debt back home with that. It’s very important to definitely start the saving nest the moment you start looking into going to study international, and as you really want to have a cushion to land on

09:22 Emily: One other thing to point out here is in this process of researching where are you going to be moving, I find this the idea very daunting of figuring out what is the cost of living in a country that I’ve never lived in, in a city that I’ve never lived in. The US is obviously very diverse in terms of cost of living, and some places I’m thinking about bringing savings, like to a place where if you’re going to rent somewhere it requires, first month, last month deposit all upfront, that can be thousands of dollars easily, as well as just the actual transit, the transitioning costs. Plus sometimes there are fees to be paid to universities upfront. It depends on how your university structures things, but sometimes there could be over a thousand dollars, multi-hundreds of dollars in fees to pay near the start of the semester, that are not like prorated over time. So all of these things have to go into the research of where you’re going to be living.

10:23 Josephine: Yes, they definitely have to and I always advise people that do not look at the big cities. It’s very tempting to want to go to the big cities, because that’s what you’ve seen on TV all your life. And that’s where maybe some of the most universities that you’ve heard of are, but smaller cities actually have just as good universities, but their cost of living is lower. When you’re in a smaller city, your cost of living could really be low, which could then make it easier for you, but as you do the research, look at programs that offer graduate assistantships, if you can, if they offer full graduate assistantships. And like you said, some of them include fees and others don’t, so if you can get a program that pays for fees, pays for health insurance, and a stipend at least close to the cost of living in the town, because those are available online; you can look up the cost of living. That could make really your life more manageable, if you can get an assistantship that can give you full tuition, including fees, health insurance, and a stipend. Otherwise, fellowships or scholarships, because all of these are really, they’re not just readily available, they are competitive. It’s important to look out. Some of them are not even advertised, so sometimes you might have to just write to people at the university and say, “Hey, I’m looking at coming into your program, can you talk to me about the funding structures of your program?” Because some things are not advertise, and if you don’t ask, you wouldn’t know. So it’s really, it’s an investment into just looking into deciding where to go to ensure that you are not under financial strain while you are in your studies.

12:15 Emily: I totally agree. This is the same process, again, that domestic students need to go through is figuring out what the funding structure is. I would say most primarily in your field, because this is oftentimes very field dependent, like whether funding typically comes from fellowships or training grants, or whether funding typically comes from research assistantships versus teaching assistantships. Versus other fields, maybe the funding is very spotty. Sometimes it’s here. Sometimes it’s not. And all that you need to be going in with your eyes wide open as to what that situation is. I usually suggest a bit of networking and informational interviewing, not necessarily with the faculty, but rather with anyone you have a connection with who’s already at a university in particular, if you have one in mind or even just your field more generally. Like alumni associations, for example, is a great way to reach out to people. You don’t know who they are, but they have some kind of connection with you and maybe they’ll be willing to have a conversation with you because you can really get the best insights, I think from current students. Faculty, sometimes they might paint a little bit too rosy of a picture about the finances in a graduate program, because well, one, they may not be aware of some of the difficulties that students are going through. And two, they may want to recruit you and so they might be a little more optimistic than things really are. So I would say talk to with current students. Of course you do eventually need to connect with faculty members as you’re in the application process, but maybe when you’re just getting more information, just trying to narrow down the field, students are really great resource.

13:46 Josephine: Oh yeah. Students will give you the true picture without needing to paint it any rosey, because they have gone through it and some of them might not have had the same guidance. They will tell you the truth, so the reaching out to current students is definitely a must, I would say.

14:03 Emily: Yeah. And the extra wrinkle there for international graduate students, you can correct me if I’m wrong about this, but the extra wrinkle there is, well, really please do talk with other international students, and even particularly if there are some from your own country that would be especially helpful, because a lot of times programs don’t pay very well, like you just mentioned pay at least equivalent to the cost of living in a certain city. The resource that I really like to point to is the living wage database at MIT, livingwage.mit.edu. That’s an awesome resource for telling you in every county in the US or every metro area, what is the baseline amount of money that this research points to as needing to just get by just necessary expenses.

14:48 Emily: Okay, so speak with other international students, because I know what happens a lot on the domestic side is that if universities are not paying well enough, domestic students will side hustle. They will have outside jobs. And that is, as we discussed earlier, at least for jobs originating in the US, not an option for international students. Also debt is almost completely not an option because you have to have a US guarantor and that’s a whole big hurdle to get over. And so pretty much student loans are not accessible to international students unless you already have connections in the country. The fallbacks that domestic students have — the safety pressure release valves on their finances — are not necessarily available, usually not available to international students. That’s something really important to consider that if a domestic student is telling you, “Oh yeah, it’s okay, but I work 5-10 hours a week tutoring or whatever outside of my primary appointment,” please know that that option is not available to you and you’re going to have to make the finances work another way.

15:48 Josephine: Yeah, absolutely. And I would say that you would also need to just manage the little that you have when you get it. If you manage to get an assistantship, if you have a scholarship, if you somehow have an assistantship, even if it’s outside of your department, in the university, really try to stick to a budget. Draw up a monthly budget, stick to it, your income is fixed, so your expenses should be. Those really include things such as like sharing an apartment, to reduce the rent costs, just keeping your expenses low, using campus resources, such as buses to get around, instead of buying a car. If the university has a good bus system, you can use that to get around, you don’t need to get a car. Medical expenses, try to minimize those. Use the university campus health facilities, because medical expenses can be really high. I’ve had experiences in both times. When I was here the first time, there was a time I had to get an ambulance, and that cost me a lot of money. And this time I also had to go to an ER and that, again, cost me a lot of money that I had to continue to pay off. So try to minimize those. Save every month. If you have a stipend that you receive, even if it’s just $20, just put away something, you never know when you might need it, especially when you’re in a country where you might not have a network at all, not anyone that you can just call up. If you don’t have obligations at home, you will manage somehow. Try to stick to your budget and save every month, if you can.

17:42 Emily: Totally, totally agree with all of that. Especially about not committing yourself to higher fixed living expenses, right away. Yes, definitely find a place that’s on a bus line. I do remember, so I went to graduate school at Duke, so Durham, North Carolina. At the time, it was a very car dependent town, so moving there as a domestic student, I was like, “Oh, I have to buy a car.” I was living actually car-free before that point, but I was like, “Oh, Durham, I have to buy a car there.” But once I moved, I noticed that a lot of the international students who were my peers did not have a car yet because, there’s a process to go through. They had to get a license. They had to be able to get credit, to qualify for a loan. It took six months or 12 months for them to buy cars. So I was realizing, “Oh, well, they’re managing to get around okay. Yeah, they have to bum an occasional ride, but mostly they’re using the buses” and it’s actually pretty manageable. Try to set your life up that way, at least in the first year. You can reevaluate in subsequent years if that’s working for you or not, but really try to get those baseline expenses low until you have kind of your bearings in your new city.

Commercial

18:54 Emily: Emily here for a brief interlude taxes are weirdly, unexpectedly difficult for funded grad students and fellowship recipients at any level of PhD training. Your university might send you strange tax forms or no tax forms at all. They might not withhold your income tax from your paychecks, even though you owe it. It’s a mess. I’ve created a ton of free resources to assist you with understanding and preparing your 2020 tax return, which are available pfforphds.com/tax. I hope you’ll check them out to ease much of the stress of tax season. If you want to go deeper with the, or have a question for me. Please join one of my tax workshops, which you can find links to from pfforphds.com/tax. It would be my pleasure to help you save time and potentially money this tax season. So don’t hesitate to reach out. Now back to our interview.

US Funding Models and How They Impact International Grad Students

20:00 Emily: Was there anything else that you wanted to add about funding models in the US. We mentioned a few of them — assistantships, fellowships and scholarships. I did notice I’ll add here, in my own graduate program, a lot of international students did come with funding from their own home countries. So they were sponsored by their own federal government, so that is an option you can investigate in whatever your home country is, but I noticed that as another possibility.

20:27 Josephine: Yes. There are some countries that would have scholarships within their own funding structures, so if those are available in your country, that’s great. Some companies within the country could also sponsor you, or maybe even your employer, they might be able to sponsor something so that if you have those options, that is great. But the one thing that I also wanted to mention on the funding structure is that as you review an offer for an assistantship, for example, they usually do not include summer. That’s another aspect that you need to look at — what will you be doing in the summer? Will you be able to survive during the summer? Will you have an option to work? Would you be able to get an exception to work, or would you be able to have your assistantship extended to cover the summer? Because most assistantships do not include summer and many international students find themselves over the summer, really stranded and not having any funds. And it can be tragic.

21:32 Emily: Yeah. I would say that goes into the research that you need to be doing into how your field, and then how specifically the programs that you’re looking into are funded. Because as you said, many places do not offer summer funding, or at least the funding might be different. Like maybe you have an assistantship during the year, but then summer it’s on you to go and apply for fellowships and when win of them., so that could be the expectation. Other places do have 12 month, year round funding. It really just depends and so it’s something you have to go in your eyes wide open and aware of. Again, I’ll repeat, the same advice for domestic students read that offer letter really, really carefully, because I’ve read many that just say what your funding is for nine months, then just stop talking about what happens next. You really need to ask those follow-up questions — what’s typical, what’s on the table? If they just say, “Oh, well, yeah, you’re definitely going to be funded, we just don’t know exactly how, we don’t know exactly what the mechanism is, but don’t worry about it, you’re definitely gonna be funded.” That’s a great answer to hear, but if you hear, “Oh, well, right, summer’s on your own, you need to figure that out,” then, okay, you need to know that going in.

Money Management Tips for International Grad Students

22:34 Emily: Now in terms of strategies for money management, you already mentioned budgeting. You mentioned saving even if a small amount. Are there any other strategies that you particularly want to point out for international graduate students?

22:48 Josephine: It’s really more looking at what you can bring in from home and this simple things such as watching…I don’t know, some countries have exchange rates that really fluctuate a lot, so if you have some money at home, for example, and something your currency just suddenly became favorable in comparison to the dollar, you should set up the money transfer from home in that way to say, “Oh, look at my currency — if I transfer right now, I’ll get double the money then I would get some other time.” I mean, obviously it’s something you need to actively do, and maybe it needs a special skill, but it can benefit you if you transfer money at times when your currency is not too weak against the dollar. For me, that’s something you can, you can as well look at. Again, leaving no obligations at home, I think that that can really leave you free and be able to focus on your studies, because if you have a debt back home that keeps needing money from you, it will weigh on you and you will need to accommodate it in your budget here in the US, and that can just kind of set you back up.

24:13 Josephine: Try to find really people that you can share expenses with, like whatever you do, if you’re able to share expenses with people — I loved to travel, when I was here for my masters, because I had the time, unlike now, and I would find friends and we would go to visit a state that we have never seen before. And when we are in a big group, you are able to share that cost without necessarily breaking a bank and you you’re able to kind of also have a good time, so that you’re not just focused on your studies. You have a good time as well on a budget, but when you have friends that you can share with it keeps your expenses down. Phones, again are another thing where if you have a friend who you can share, who can maybe help you put on their family plan, which are cheaper, instead of subscribing for your own phone directly.

25:21 Josephine: Don’t get yourself into things such as getting cable and do what you can stream online. Books for school — there are many used books out there that are cheaper. There are rental options. You can also stick to just maybe borrowing books from the library and really checking which book do you really need to buy in the end, instead of just buying all the books that are required. Books can be really expensive, so I had worked with the library for the most part. At the beginning of the semester, what books do I need? Check the library. Are they available? And then if I see that it’s a book that is really important for my future, then I will actually I’ll actually go and buy it, but otherwise I just borrow, use it and take it back. That way I keep my expenses low.

26:16 Emily: I’ll add a note on the textbooks there. I ended up borrowing textbooks from other students who had taken the course the previous year or whatever. Sometimes there might be an edition change, but sometimes not. And so I found that to be really useful because yeah, some people do invest in books and they want them available to them long-term but yeah, they can part with them for a semester, especially when they know where to find you. So that’s another good resource is just students who took that class last year.

26:41 Josephine: Yeah.

26:43 Emily: I do want to bring up remittances. You mentioned earlier supporting maybe dependence back in your home country, but that could extend not just to your children, but maybe your parents or other family members. So you have any suggestions for people who are expected to help continue to support family members or the like?

27:04 Josephine: Yes. I think there’s many tools online that actually charge really, really low fees to transfer money back home and are easy and fast. If you have a bank account, which for the most part, you would probably have, there’s ways that you can send money through your bank to your country, but that tends to be more on the expensive side, in terms of the international wire fees. There are online tools, financial apps that you can use to send money back home, as long as the person back home is able to receive it, and you can track it, that’s okay. But for me, I found those services cheaper compared to doing it through my bank, because the bank is obviously to involve the process that you have to go through. The money might not be available as soon as you needed, if the people need emergency money. It’s better to use the international wire tools that are available online. I think, I don’t know if I should mention any of them, but there’s WorldRemit, there’s MoneyGram, and the likes. There’s this many of them. One really just has to look and see which one offers the lower cost for sending money to your country, because the cost also varies depending on where you’re sending the money. So check which one has a low cost of sending money to your country and a fast one as well, because often people at home are not going to wait a week if they need the funds. So find the ones that it’s cheaper and faster to send money back home instead of doing it through your bank.

28:55 Emily: Yes. Thank you so much for making those suggestions. That’s something that I hadn’t thought about, like the mechanics. And I know a lot of people hear about building credit in the US when they first move here. Can you make a couple comments about your experience with that, or the best way to do that?

29:11 Josephine: Credit card companies here just give you unsolicited credit offers. And for me, I would say resist them if you can. It’s important to build a credit if obviously you plan to stay here, and maybe eventually get a job. But credit needs discipline. And as a student who might not necessarily have the means to always service your credit, my main advice is to stay away from the credit, but if you find yourself not able to, and you would like to take on some credit, either for credit building, or just really to make up some gaps that you need, then make sure that you do pay it off. Do not take away anything that you are not able to settle within that the month. Or if you really need, if it’s an emergency, then you have to set up a fixed repayment plan to make sure that you pay back because you also don’t want to leave the country with debt. I would advise against getting debt. If you’re going to get a job, just wait until you have a job. But if you want to access the credit that’s available and you have some offers then make sure that you do pay them off.

30:44 Emily: Yeah, I think my perspective on that question is it is helpful to have a credit score, a good credit score, in terms of actually just finding rentals. And this also depends on the housing market that you’re in, so it might be different, you know, cities versus smaller cities. Go ahead and build the credit, but like you said, don’t actually use it by carrying debt or carrying balances or paying interest. Do it in a way that you don’t have to pay any fees, essentially, but you can still build your credit score for the point that you need it. And like you said, maybe you won’t really need a credit score until you need to get a job or take out, like I mentioned car loans earlier. That could be a possibility if you feel you can support the debt. It’s a funny thing because credit scores seem like they should only be useful when you’re taking out debt, but in fact, they creep into other areas of life as well. It’s like a helpful thing, although not maybe like strictly necessary depending on your housing market.

31:43 Josephine: Yeah. I mean, yes, you do get kind of penalized if you don’t have any credit history, like you have never taken out credit, they penalize you on that. But yeah, build as little as you can for what you need, but don’t get into it because you probably come across friends who have used debt to pay off their studies, especially the domestic students, but it’s different. I would say as an international student do not take on any credit that you are not able to service immediately.

31:17 Emily: I totally agree. And we talked about the dangers of having debt earlier, when you’re obligating a portion of your already very small stipend, already completely limited stipend. It’s a tool you have to be really, really careful with because it’s very easy to get in trouble.

32:33 Josephine: Oh yeah, and they just send you, sometimes the moment they have the address, they just send you offers — “you qualify for a hundred thousand”, “you qualify for a credit line and you also get this airline miles” and you’ll still have to pay for them, so just stay away from it.

The Financial Culture Shock for International Grad Students

32:50 Emily: Absolutely. Is there anything that has struck you about the financial culture in the US that you think international students need to know about before arriving?

33:01 Josephine: I think for me, what was shocking is really the 20 hours a week that that is really strict. I think when we come, sometimes we think, ah, I’ll be able to make my way around this. I’ll be able to find a job. I’ll be able to make extra money. You really can’t. So you are only allowed to work 20 hours a week and it’s important to keep that in mind, That that 20 hours a week is the only income you will have. Life is expensive. Just buying bread itself, I was shocked at how much bread cost around here. The culture of eating out for the most part and really not, not cooking at home. So you would have to resist always being out, because obviously you won’t be able to probably fund it, and find ways to really cook at home. For me, the credit card offers were the most shocking, because I’m like, “Do they know how much I earn? Why are they offering me this credit?” Because in my country getting credit is very difficult. You only get credit if you earn a certain salary and you can prove that you have a good credit history of paying off any loan that you have had before. So getting offers from companies to just say, you qualify for credit, without me doing anything, was what was kind of surprising.

34:40 Josephine: Big cities, again, very, very expensive, every little thing costs you money, so it’s better to stay maybe in like a rural town, which is very close to a big city where you can take and one hour train to a big city, for example, that takes off a lot. If you can stay in a smaller town, which has a train that goes into a big city for one hour, that kind of gives you the best of both worlds. But yeah, the financial culture in the US is just, it’s a spending culture. It’s obviously about revolving money in the economy and supporting the businesses. So it is just, we have to keep spending there’s always holidays that have different things that you need to spend on. You really need to be able to manage your spending within such a culture.

35:39 Emily: I agree. I think from what I’ve read about, let’s say permanent immigrants to the US, they come with certain, I’m generalizing, obviously the world is very diverse, but oftentimes the US is more consumeristic and then the countries that they come from. And so, maybe that first-generation keeps some of the mindsets from their home country, original culture, but it gets diluted, and within two, three generations, the descendants of those people are just totally in the thick of the consumerism of the US and completely Americanized in that way. I would imagine it can be quite shocking, and a lot of pressure to spend once you’re here.

36:24 Josephine: I think the other thing is also to pay your taxes. Obviously in many countries, people still pay taxes, especially if you’re in a salary, your employer has an obligation to deduct that, but the deadlines on when to file and all that could be like flexible. But here it’s really, I feel it’s important to keep to the deadlines and ensure that you file the taxes and don’t do anything to feel maybe, “Oh, okay. If I say this, then I can claim more.: Don’t do it. It will ruin your life and it will ruin your chances to ever be in the US, so do pay what is due to the tax man and do not claim anything you are not entitled to.

37:18 Emily: Yeah. So I think what I’m hearing you say between the rules about visas and then the tax stuff is, there’s not flexibility here. The rules are the rules, and you need to follow them. You need to toe the line, because especially as you said, if you eventually want to get a green card and stay in the US, there could be things that come up in your history, your record, that torpedo that application, if you’ve made any missteps early on. So really, really keep to the rules. I have corresponded with international graduate students who have skirted the rules and worked extra or whatever, and they got away with it, I guess, for the time being, but I always say don’t chance it.

38:01 Josephine: No, because then you walk around looking over your shoulder, wondering if someone will come after you at some point. So I think just live, you’re in another country, just live according to their rules.

Financial Advice for Early Career PhDs

38:12 Emily: Okay. Josephine, as we wrap up, what is the best financial advice that you have for another early career? PhD could be an emphasis of something we’ve already talked about today, or it could be something completely different.

38:24 Josephine: I think there’s a few things that I just need to emphasize, which is seek funding. There are options out there. Don’t up on your dream thinking, there’s no way I can study in the US, I don’t have the money. There are options. There are funds out there that sometimes go unclaimed. Talk to as many people as possible that can help you to give you the information on where to find funding, because there are ways for you to be able to fund your PhD dream. Again, avoid debt. Live modestly. The rewards will obviously come later, hopefully.

39:04 Josephine: And then just make sure that you do it for the right reason. As you make your decision to pursue a PhD, it’s not like a master’s program where you do it, you finish maybe within two years or one year, and you can go and get a job. It takes time. So at some point it will get tough. Whether it’s financially or just the coursework, it will get tough. But if you have a clear motivation, if you have a “why” you’re doing it, you will remain on track. Don’t come to do a PhD as a way to just be in the US because when it gets tough, you will find it hard to keep motivating yourself. When the stipend is much less than the salary you used to get back home before you resigned, there will come a day when you are like, why am I even doing this? Why did I have to give up my job to come and do this thing, which is now going to take me four years to finish, but if you have a clear motivation on why you’re doing it, I think it will keep you going., when you can keep going back to your why.

40:15 Emily: Beautiful, beautiful advice. Thank you so much for adding that. For the international listeners, I will add a few links in the show notes of previous interviews I’ve done, some articles I’ve written specifically for international students. There’s one especially, we didn’t touch on investing in this interview, but if you’re interested in investing as international student, I have an interview on how you can make that happen, so that could be of interest as well. Josephine, thank you so much for joining me on the podcast and giving me this wonderful interview.

40:45 Josephine: Thank you. Thank you, Emily.

Listener Q&A: Credit Cards

Question

40:47 Emily: Now it’s time for the listener question and answer segment! This week’s question is one I ran across on Twitter from Jake Thrasher, who gave me permission to answer it in this segment. Here is Jake’s Tweet: “Does anyone have good credit card recommendations for grad students? I’ve never had a credit card before, and I have no clue what I’m doing.”

Answer

41:08 Emily: Jake got a lot of great answers to this question on Twitter, and I’ll link to it from the show notes.

41:13 Emily: I’m going to answer this question not with respect to what might be the best credit card for a grad student right now, but rather how to find a first credit card no matter when you may want one.

41:23 Emily: First, you should determine what characteristics you’re looking for in a first credit card. It is recommended that you keep your first credit card open indefinitely because having a higher average age of credit boosts your credit score. So even if you open and close other cards later, ideally you would keep this one open for many years. Given that, I recommend that you sign up for a card with no annual fee and also with a creditor who has a reputation for good customer service. Some other features that are nice-to-haves but not must-haves, in my opinion, are ongoing rewards, a sign-up bonus, and waived foreign transaction fees.

42:03 Emily: If you have any inkling in your mind that you might carry a balance on this card in the future, look for a card with the lowest interest rate that you can find. I did this when I signed up for my first credit card because I didn’t 100% trust myself to pay it off completely every statement period. I ended up creating a track record of paying my cards off completely and on time, so now when I open credit cards, I don’t even look at the interest rate. But if you’re just starting out with credit cards, that’s reasonable to take into account.

42:34 Emily: Finally, to avoid applying for cards that you won’t get approved for, you should take into consideration your current credit score. If you’re new to credit you might not have a credit score or it might be not very high yet. You can search for cards that don’t have a credit score requirement in that case. For anyone new to the US, it’s typical to apply for a secured credit card as your first one.

42:57 Emily: Once you have your lists of must-haves and nice-to-haves, it’s time to start searching for current offers. You can definitely Google “best first credit card” or some variation on that and see what you get. I also like to use the sites bankrate.com and Nerdwallet.com. Those sites typically set up categories of cards for you to peruse, such as student cards, no annual fee cards, cards for bad credit, etc. However, please note that probably any credit card review you run across online has an affiliate or commission structure in place. That means that if you click through a review to open one of the cards, the site hosting the review will get paid, and that can bias their reviews. Look across a few sources to see if some cards commonly pop up within the criteria you’re searching for.

43:46 Emily: For example, when I’m doing this exercise in January 2021, I’m seeing that Discover offers a student card that probably fits the bill. Many of the people who responded to Jake’s prompt said they used Discover cards when they were starting out. I read Discover’s policy, and apparently after you are no longer a student they reclassify the card to a non-student card with the same benefits structure, so you keep the longevity of that account going. While I’ve never had a Discover card myself, they are one of the major players in the credit card space and their online reviews seem to be solid, which leads me to believe it will be easy to keep the card open for a long time.

44:22 Emily: Another great suggestion from the Twitter responses is to open your first card at a local credit union because they are likely to be less predatory than a bank. So that’s a great approach as well, provided that you will still be able to use the card with ease if and when you move away from the area that the credit union serves.

44:40 Emily: One final suggestion for Jake since he said he has no clue what he’s doing: Read my article titled Perfect Use of a Credit Card, which is linked from the show notes, and follow its advice to the letter. It’s super, super easy to slip up with a credit card and quickly get in over your head with the high interest rate. I’m very strict about how I use credit cards, which I explain in the article, and I suggest you set up rigid rules for yourself as well, such as treating your credit card exactly like a debit card.

45:11 Emily: Thank you, Jake, for posing this question on Twitter and permitting me to answer it here!

45:16 Emily: If you would like to submit a question to be answered in a future episode, please go to PFforPhDs.com/podcast and follow the instructions you find there. I love answering questions so please submit yours!

Outtro

45:29 Emily: Listeners, thank you for joining me for this episode. PFforPhDs.com/podcast is the hub for the Personal Finance for PhDs podcast. On that page are links to all the episodes show notes, which include full transcripts and videos of the interviews. There is also a form to volunteer to be interviewed on the podcast and instructions for entering the book giveaway contest, and submitting a question for the Q&A segment. I’d love for you to check it out and get more involved. If you’ve been enjoying the podcast, here are four ways you can help it grow. One, subscribe to the podcast and rate and review it on Apple podcasts, Stitcher, or whatever platform you use. If you leave a review, be sure to send it to me. Two, share an episode you found particularly valuable on social media, with an email list serve, or as a link from your website. Three, recommend me as a speaker to your university or association. My seminars cover the personal finance topics PhDs are most interested in, like investing, debt, repayment and taxes. Four, subscribe to my mailing list at pfforphds.com/subscribe through that list. You’ll keep up with all the new content and special opportunities for Personal Finance for PhDs. See you in the next episode! And remember, you don’t have to have a PhD to succeed with personal finance, but it helps. Music is Stages of Awakening by Poddington Bear from the Free Music Archive and is shared under CC by NC podcast, editing and show notes creation by Lourdes Bobbio.

Catching Up with Prior Guests: 2020 Edition

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Emily published the first episode of this podcast in July 2018. This is the one hundred and seventh episode, and over the last two and a half years, the podcast has featured 94 unique voices in addition to Emily’s. The last episode in 2020 catches up with the guests from Seasons 1 through 3. The guests were invited to submit short audio updates on how their lives and careers have evolved since the time of their interview. The question with which all the interviews are concluded now, “What is your best financial advice for another early-career PhD?” was not one that was asked in the earliest seasons. The guests who didn’t have the opportunity to answer the question in their initial interviews answer it in this update, so you’ll hear lots of financial advice throughout the episode as you have grown to expect from this podcast.

Link Mentioned in this Episode

financial interviews

Introduction

00:10 Emily: Welcome to the Personal Finance for PhDs podcast a higher education in personal finance. I’m your host, Dr. Emily Roberts. This is season seven, episode 16, and today I’m featuring many guest voices. I published the first episode of this podcast in July, 2018. This is the 107th episode and over the last two and a half years, the podcast has featured 94 unique voices, in addition to my own. For a last episode in 2020, I thought it would be fun to catch up with the guests from seasons one through three. I invited them to submit short audio clips to update us on how their lives and careers have evolved since the time of our interview. The question with which I conclude all of my interviews now “what is your best financial advice for another early career PhDs?” was not one I asked in the earliest seasons. I asked the guests who didn’t have the opportunity to answer the question in their initial interviews to do so in this update, so you’ll hear lots of wonderful financial advice throughout the episode, as you’ve grown to expect from this podcast. The audio clips in this episode are ordered by when the original episode was published. If you’d like to circle back and listen to any of the previous interviews you can do so in your podcatcher app, or at my website, pfforphds.com/podcast. To keep up with future episodes, please hit subscribe on that podcatcher and/or join my mailing list at pfforphds.com/subscribe. Since I featured my own financial story from graduate school in season one episode one, you’ll hear an update from me first followed by the rest of the guests. Happy listening and here’s to the end of 2020!

Dr. Emily Roberts

01:53 Emily: Hi, this is Emily Roberts from Personal Finance for PhDs. I was on season one, episodes one and two, and season three, episode one and it’s been about two and a half years since I recorded the first of those episodes. Not a whole lot has changed career-wise in that time. My husband still works for the same startup that brought us to Seattle, and I’ve expanded my business into a few new areas. I now offer one-on-one financial coaching, run a group coaching program called The Wealthy PhD a few times per year, and facilitate the Personal Finance for PhDs community. And of course, continue to host this podcast and give seminars and webinars for universities and conferences. The big personal changes are that we had a second child, so our daughters are now ages four and two, and we moved from Seattle to Southern California in August, 2020. Moving in a pandemic with toddlers was much more challenging and less enjoyable than the move I described in my earlier episode, but it went very smoothly, all things considered my husband and I are now technically location independent, at least for the time being. Our current big financial goal is to buy our first home in Southern California in 2021. For the last several years, we’ve balanced investing for retirement with saving a down payment, so hopefully we’ve done enough on both fronts. I’m really looking forward to stability in the housing area of my life. Thanks for listening to my update. If you want to get in touch, you can visit my website pfforphds.com or find me on Twitter at @pfforphds.

Dr. Caitlin Faas

03:27 Caitlin: Hi there listeners. My name is Dr. Caitlin Faas and I was on episode seven of season one, October of 2018. A lot has changed for me since then. I left my position as a faculty member. I was tenure track at the time earned tenure, became a department chair and then left the position at the end of 2020 to work for myself full time as a certified life coach, I made that decision officially in February of 2020, right before COVID hit. And I knew it was time to take the leap. And then the universe sent me all the tests, my husband being laid off and COVID and so many other things, but I still trusted and knew it was time to leave. And I’m proud to say this year, I’ve earned over a hundred thousand dollars and we paid off all of our debt and all my concerns and worries that I managed along the way are what made it possible for me to be ending the year of 2020 successfully.

04:33 Caitlin: We also, in that time adopted our teenage daughter out of foster care and something I wish I could tell myself, looking back in 2018, as I had an idea that I might want to leave academia and continue to grow my business was I just wish I could tell myself not to stress as much about the debt we had. I took it a little too seriously. It all worked out as it was supposed to, and I didn’t have to hustle and grind my way there. I definitely followed a budget and Dave Ramsey’s plan, but the biggest thing was money mindset and law of attraction, setting those goals for myself and continuing to trust the flow and surrender to the process. That’s what made the difference. So best of luck as you hear my update and go about your own path with Emily.

Nicholas Giangreco

07:13 Nicholas: Hi, this is Nicholas Giangreco from season one, episode 10. I am a systems biology PhD student at Columbia Medical Center. I’ve kept a budget throughout my studies and living in New York City, logging in my expenses and savings. First switching to a rainy day fund goal, then a more moving fund/cushion goal, and now recently, been able to transition to more heavily into a retirement saving, and that’s because having the budget has helped me be more conscious of my spending and saving decisions over time. That would be my advice for new graduate students — keep a budget. I use Google sheets. Whatever makes you conscious of your decisions and helps you stick with a goal that you have in mind is really important throughout your graduate career. As well as taking advantage of opportunities, such as tutoring, teaching, and internship. They can help you get to your goals and become more financially stable. Hopefully that helps out people and enjoy the rest of your listening.

Bailey Poland

08:51 Bailey: Hi, my name is Bailey Poland, and you can find me at Patreon.com/BaileyPoland. I was originally on season one, episode 12. I’m now a fourth year PhD candidate in rhetoric and writing studies. And I’m about a chapter and a half away from being done writing my dissertation. I’m currently on the job market, both for academic and industry jobs, especially given the way the COVID-19 pandemic has affected the academic job market. In the original episode, Emily and I talked a lot about side hustling, so I wanted to give a little bit of an update about that. While I do still have my Patreon, my other side gigs have changed a lot and this year I’m on an assistantship that allows me to focus exclusively on my dissertation, so that’s my main priority right now. But in the past couple of years, I’ve worked as a virtual social media assistant for a women-focused finance organization called city girl savings. I took on some extra work in my department as a digital development and promotional outreach assistant, and I’ve done various freelance jobs in writing and editing, especially professional writing and editing, as I’ve had the opportunity to work on those. So despite my stipend only going up a little bit across the time that I’ve been in the program, I’ve managed to hit a six figure net worth over the past couple of years by keeping my expenses low, doing that extra paid work and investing.

10:14 Bailey: And on that note, my best financial advice for another early career PhD is to find a way to save and ideally invest as early as you possibly can, even if it’s just to get into the habit of having some money set aside or having an automatic transfer of some kind of set up. Even if you’re still paying off other debt, even if it’s only a little bit of money here and there, that really, really adds up, especially over the long-term. Time is a huge factor in creating financial security for yourself and the earlier that you can build those foundational habits, the better off you’ll be.

Dr. Lauri (Lutes) Reinhold

10:51 Lauri: Hi, my name is Lauri Reinhold, formerly Lutes, and I was on season two episode one. My main updates are to share that I completed my PhD and amidst the pandemic, which was quite an achievement for me. And I now have a postdoc position. In my episode, I spoke a lot about the ways I took advantage of resources in my area to overcome some of the challenges of being a single mother and a graduate student. One of the goals later on in graduate school that I looked into was home ownership. And I wanted to share this with you because had I looked into it sooner, I probably would have benefited a little bit more. I am settling into a higher cost of living area, especially in comparison to where I grew up in the Midwest. And looking into home buying is quite intimidating due to the average cost of a home. I found in my state in Oregon, there’s a program called an individual development account or an IDA, and this is a three to one matching program where I can contribute $2,000 and walk away with $8,000 that I can use for a variety of different expenses — educational buying a car retirement. However, I was most interested in using these funds for a down payment on a home. Unfortunately since I looked into this later in my career and my admittance into this program was delayed due to the pandemic and this perfect storm of things occurred, my current income puts me just over the threshold to qualify for this program, so I’m no longer able to participate. However, I am happy to report that I have learned a lot about the home buying process along the way, and that I am still actively pursuing this long-term goal. My advice to you is if you have these financial goals, I encourage you to see what’s available in your state and take advantage of these programs sooner than later, so that you can start saving. And perhaps you might be more likely to meet some income thresholds and take advantage of some of these opportunities to get ahead.

Dr. Gary McDowell

12:54 Gary: Hi, I’m Gary McDowell and I work as a consultant on early career researchers and affecting change for and with them. I’m now based at Lightoller LLC, but you may have heard from me on season two, episode three, when I was the executive director of the nonprofit Future of Research. I’m doing almost exactly the same kind of work and have the same motivations to work on behalf of the interests of early career researchers. Now I’m just in a different business model. I’m also now more permanently settled in Chicago, Illinois. I spoke about our effort on postdoc salaries with you before, and I’m still working on that in my spare time. I’m currently embarking on a new set of data requests from universities, and I hope to have five years of data to look at and share with you all in the not too distant future.

13:38 Gary: But I think the best advice that I can give to you at the moment is that you should be very proactive in bringing up the topic of salaries when talking with current or potential supervisors in an academic setting. I mentioned this for a couple of reasons. Firstly, my sense is that compared to when I started working on salaries nearly five years ago, it has become much more acceptable to talk about money, hopefully in no small part because of the efforts of people like myself, constantly putting this up as an issue publicly with academics. This is particularly true, I think, in the present situation with the COVID-19 pandemic and the increased financial burdens that that’s placing on early career researchers. I think it’s important that you try, if you can, to advocate for yourself.

14:23 Gary: Secondly, I always advise that you bring this up with a potential supervisor because how they react can tell you a lot too. Even if you don’t get a raise in the salary offer from the discussion, if they react with, “why would I pay you more?” I think you should probably question generally whether this is the person you actually want to work for versus someone who might respond that they can’t give you a raise, but then talks about how that could be explored through fellowship applications or talking to the department chair, or just generally seems willing to about it. If you don’t feel able to advocate for yourself, maybe you have a precarious visa situation, for example, find ways of advocating with others through a union or association. There’s strength in numbers and decades of recommendations from blue ribbon panels that you should be paid more. So make sure you’re advocating for your worth because you are worth it. Feel free to contact me. You can do so through my website, lightoller.org or emailing info@lightoller.org. Or you can always contact me on Twitter at @GaryMcDowellPhD, or find me on LinkedIn. Thanks for listening.

Maya Gosztyla

15:33 Maya: Hi guys, this is Maya Gosztyla from season two, episode four of the podcast, which came out in February of 2019. And that episode was about how during my postbac fellowship at the NIH, I was able to save about 30% of my income despite having a fairly low salary of only around $30,000 a year. We also talked about how I use science communication as a side hustle to earn a bit more money on top of that. It’s been almost two years now, about a year and a half since that was published and a lot has changed since then. I got married to my then fiance and we had a very simple wedding. We just eloped at the cherry blossom festival in DC and spent some money on a two week honeymoon abroad, which was lovely. I also started grad school at the University of California, San Diego, which is also lovely. I love it here.

16:25 Maya: A lot of the things that I talked about in that episode have continued. I still live very simply. I don’t eat out very much and I try to budget very carefully. But of course, 2020 had a lot of things that made it much harder to live the way I had last year. In grad school, I have a pretty similar stipend as I did as a fellow and I also have a fairly similar cost of living, but the difference is now of course it’s me and my husband, not just me living by myself since we were long distance during my fellowship. As a result of COVID, like so many other people, my husband does not have a job right now so we’re basically both living on my grad school stipend. As a result of that, I’m no longer able to save 30% of my income. Unfortunately, we pretty much just break even with the stipend alone. However, I have continued doing my little side comm side hustle, and all of that is kind of on top of my stipend just goes into savings. So that just gives us a little extra buffer to continue saving a little bit toward our goals as much as we can. And having that emergency savings that I did build up during that fellowship was super helpful. It gives us a lot more peace of mind in case we have any major expenses, like when we just had to get some car repairs done, and having to buy health insurance from my husband when he aged out of his parents’ insurance. We were able to do that without much problems. So that’s been really helpful to have that little cushion.

17:45 Maya: Our plans for the future are basically when my husband does get a job, and hopefully this pandemic ends, people can go back to work, we’re going to continue to live on my stipen as much as possible and then try to use anything that he makes to just work on paying down student loans, and eventually saving toward retirement. My advice for students would be definitely save up some emergency savings before grad school, if you can. And if you’re living with a partner, try to live on one income, if you can. I’d be happy to talk to people who are in a similar financial situation and gives some advice, so you can feel free to reach out to me on Twitter. My username is @alzscience on Twitter. Good luck to everybody.

Dr. Jill Hoffman

18:25 Jill: Hi, this is Jill Hoffman from Toddler on the Tenure Track. I was on season three, episode four, where I talked about public service loan forgiveness, as well as the decision that my husband and I made to have him become a stay at home dad. Career-wise, I’m still on my tenure track position and I’m on track to submit my tenure package in October of 2021. Also in September of 2020, my husband started a part-time position that he does from home. So he’s still doing the bulk of the childcare, but we’re switching off with childcare responsibilities when our work hours overlap. Financially, given the pause on student loan interest that’s happened as a result of the pandemic we’ve put our more aggressive student loan payments on hold for now. I still have a significant amount left on my loans and I’m still on the public service loan forgiveness program. And with my husband’s loans we’re waiting to see what happens when the new administration takes office before we start back up with our focus on paying those off.

19:24 Jill: Personally, we’ve had some major ups and downs since I was in the podcast and are currently trying to work out the logistics of a move back East to be closer to family. We’re currently in the Pacific Northwest. Sadly, my dad passed away in late 2019, and we had some other family emergencies that really made us reconsider the distance from family at this point in our lives. And financially, the money associated with traveling back and forth isn’t sustainable for us at our current income level. on a happy note, we’re expecting our second child in may of 2021, so that’s also playing a role in our interest to at least be an easy driving distance to family. You can find more about what I’ve been up to toddleronthetenuretrack.com.

Crista Wathen

20:08 Crista: Hi everyone. This is Crista Wathen from Richful Thinker. Last time you heard from me was season three, episode seven, where I spoke about the benefits of completing your education abroad and how I am using my PhD salary and Swedish kroner to pay down my US student loan debt. The biggest update since the interview that I have for you is I have finally reached positive net worth after being negative for so many years. I was also asked what was the best financial advice that I can give you, but that has changed in the meantime, and it is increase your savings rate so you can let that. You do have to decide the vehicle in which you want to place it in, but you have to let that grow. Now you can follow my journey as an American abroad. You can go to my blog, richfulthinker.com or my Instagram account, which is @richfulthinkerblog. Thank you guys so much for listening and I hope to speak to you soon.

Dr. Gov Worker

21:12 Gov Worker: Hi, this is Dr. Gov Worker and I appeared on season three, episodes eight and nine. Emily and I talked about the FIRE movement and the FIRE movement stands for financial independence and early retirement. Since that time I’m still on a path towards early retirement and financial independence. And in fact, with the large market gains that have been going on since the time we recorded, I’m further ahead than I thought it would be towards achieving financial independence. Once I reach financial independence, I’m still planning on working right now, but it’s nice to know that if something were to happen, I’d never need to work again, but I’m enjoying my job right now too much to leave.

21:58 Gov Worker: And I know I gave advice on the podcast, but if I had more advice, it would be really understand your employee handbook. Or if you work for a university, the university rules, or the federal government rules. Whatever your workplace is, understand all the rules about your employment, because sometimes you might find a benefit buried somewhere deep in an employee handbook that you don’t know about. And I think a lot of what I am really passionate about right now is educating people on how to get the most benefits out of their jobs that they’re they’re already at. I definitely recommend doing that. And if you want to get in touch with me, I’m on Twitter. You can tweet at me it’s @govworkerfi, and I’d love to hear from you. I love hearing from my readers. I also have a blog governmentworkerfi.com, but if you just tweet me, you can get to my blog.

Dr. Toyin Alli

22:59 Toyin: Hi, this is Toyin Alli from The Academic Society. I was on season three, episode 12 of the podcast where I shared how grad students can find the perfect side hustle while working on their degree. Since recording my episode, my job hasn’t changed much besides doing it remotely. I’m still a lecturer at the University of Georgia, and I’m up for promotion this year. My business, The Academic Society has grown so much since the episode. My YouTube channel has grown to almost 6,000 subscribers and my time management programs and courses are helping so many grad students. I’ve also revamped my signature grad school prep course for new grad students. It’s the resource for new grad students. Inside of my program I help recently accepted in first year grad students uncover grad school secrets by learning about the culture of grad school. I help them transform their mindset from an undergraduate mindset to a grad school mindset. I help them up level their productivity so that they can actually get their work done, and master time management so they can have time for themselves without worrying about how grad school works. I help grad students become more prepared and understand what grad school is all about so they don’t feel anxious about starting. I’m so happy that my business is in a place that allows me to not depend solely on my income as a university lecture. This summer, I was able to buy my first home, a condo in a pandemic. I’m paying off my student loans from undergrad, and I’m excited about building wealth from my side hustle.

24:41 Toyin: Thank you so much for taking the time to listen to my update and catching up with me. You can find me on my website, theacademicsociety.com on YouTube, my channel is called The Academic Society with Toyin Alli. You can also follow me on Instagram @theacademicsociety_, and you can join my Facebook group for grad students, it’s called The Academic Society for Grad Students. Across all platforms, I talk about time management and productivity, but my overall mission is to show grad students and academics that you can live a fulfilled life and be successful in academia at the same time.

Follow-up from Emily

25:23 Emily: Hey, it’s Emily again, adding onto the last update. After Toyin and I got back in touch for this update episode, she invited me to guest lecture for Grad School Prep, the course you just heard about. The recording of the workshop I gave, “Set yourself up for financial success in graduate school” now lives inside Grad School Prep. If you are a prospective or first year grad student, I highly recommend joining Toyin’s course. In hindsight, I recognize how desperately I needed the skills and information in Grad School Prep when I started my PhD. My contribution lets you in on the financial secrets of grad school, explains the financial mindset you should adopt, and walks you through the financial steps you should take during your application year and first year of grad school. Toyin gave a free masterclass on what to expect from your first semester in grad school and how grad school prep can help you with the transition, including a description of my workshop. You can sign up for the free masterclass theacademicsociety.com/Emily.

26:28 Emily: Toyin’s interview was the last one in season three so we are finished with this update episode. I hope to devote an episode at the end of each calendar year to updates from previous guests. I hope you have a restful and joyful holiday season, despite the year we’ve had. We’ll be back with a new episode on Monday, January 4th, 2021.

Outtro

26:51 Emily: Listeners, thank you for joining me for this episode. PFforPhDs.com/podcast is the hub for the personal finance for PhDs podcast. There you can find links to all the episode show notes, and a form to volunteer to be interviewed. I’d love for you to check it out and get more involved. If you’ve been enjoying the podcast, please consider joining my mailing list for my behind the scenes commentary about each episode. Register at PFforPhDs.com/subscribe. See you in the next episode, and remember, you don’t have to have a PhD to succeed with personal finance, but it helps. The music is stages of awakening by Poddington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing and show notes creation by Lourdes Bobbio.

How a Freelancing Career Can Take You from Academia to Affluence

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In this episode, Emily interviews Courtney Danyel of Academia to Affluence. Courtney became a successful freelance writer after leaving her PhD program in anthropology and moving to one of her field sites. She now teaches other academics how to launch freelancing careers through her course, Endless Freelance Income. In this interview, Courtney gives us her #1 piece of advice for new freelancers, which all academics need to take to heart! She also outlines the simple steps it takes to get your freelance career off the ground. Courtney’s location-independent business has enabled her to earn a very nice income on very part-time work, which will be attractive to academics looking to freelance for a side or main income.

Links Mentioned in the Episode

academic freelancer

Teaser

00:00 Courtney: I actually do not work full time. I work maybe 15 or 20 hours a week. But I actually still earn a full-time income because I get paid well.

Introduction

00:16 Emily: Welcome to the Personal Finance for PhDs podcast, a higher education in personal finance. I’m your host, Dr. Emily Roberts. This is season six, episode 17, and today my guest is Courtney Danyel of Academia to Affluence. Courtney became a successful freelance writer after leaving her PhD program in anthropology and moving to one of her field sites, but it wasn’t all smooth sailing. She now teaches other academics how to launch freelance careers through her course, Endless Freelance Income. In this interview, Courtney gives us her best advice for new freelancers, which all academics need to take to heart. She also outlines the simple steps it takes to get your freelance career off the ground. Courtney’s location-independent business has enabled her to earn a very nice income on a very part-time schedule, which I know is attractive to academics looking to freelance for a side income or main income. Without further ado, here’s my interview with Courtney Danyel of Academia to Affluence.

Will You Please Introduce Yourself Further?

01:17 Emily: I am delighted to have joining me on the podcast today Courtney Danyel of Academia to Affluence. And I just want to tell you, in one second, how Courtney and I first met online, which is that I saw a post that she wrote a few months back on Jobs on Toast, and I saw her business name, Academia to Affluence, and I was like, this is going to be a good fit. I need to talk with Courtney. So, Courtney, will you please tell us a little bit more about yourself and why your business name is what it is and what you’re up to?

01:47 Courtney: Okay. Yes. So sure. My name is Courtney Danyel. I am an anthropologist by training, but I actually wear quite a few different hats. I’m a freelance business writer also. I’ve been doing that for the past seven years. And as an anthropologist, I’ve worked in Africa in the Central African Republic and Ethiopia. And I actually currently live in one of my field sites, which is Ethiopia. I’ve lived here since I started freelancing seven years ago. And another thing that I started doing late last year was I started mentoring other academics and other people with an academic background to help them transition into freelancing and actually have created an online course for that purpose.

Top Advice for an Academic to Start Freelancing

02:30 Emily: Yeah. So the course name is Endless Freelance Income. I’m actually affiliate for Courtney’s course. I had an opportunity to check it out, you know, before this interview, I think it’s fabulous. And if you want to find out more about that on my end, you can go to pfforphds.com/freelance and find out more about Courtney’s course. And I actually have a couple of bonuses for people in my audience who want to sign up for her course. So, first, you know, right up front, we’re going to get some insights from this course. And then we’ll learn a little bit more about Courtney’s background and her personal story that got her to this point. So, Courtney, your absolute top advice for an academic looking to start freelancing, what is it?

03:10 Courtney: My number one piece of advice for academics who want to start freelancing is to command high pay from day one. That’s because that’s a major mistake that I made when I first started freelancing. I had finished my master’s and I had done part of my PhD and I ended up dropping out of my PhD and decided to switch to freelancing. And as far as I was concerned, I thought I was starting from zero because I was doing freelance writing and I’m writing about topics that aren’t related to my academic discipline. And so, “I don’t know what I’m doing.” And that’s basically what I thought about myself. And so for that reason, I didn’t think that I deserved very high pay. And then I took a lot of jobs that didn’t pay very well at all.

03:57 Courtney: Actually, for the first year and a half or so that I freelanced I was not paid well at all. And then one day I was doing some research for an article that I was writing. I did a lot of ghostwriting back then, which is you write content for other people and it’s published under their name. And I was doing some research for an article that I was ghostwriting for a client. And I Googled something and I clicked on an article that was on forbes.com and I looked at it and it looked familiar. And then I realized that it was written by me. And after I realized that, I started doing some more Googling and I found that my content, stuff that I had written for my clients, had been published on Forbes, Vice, Business Insider, entrepreneur.com and like all these different top business publications. So, that’s what made me realize that, wow, I guess I am a really good writer in other niches besides just anthropology. And I do deserve to be paid well for the work that I do. And after that, I raised my rates, tripled them really, and basically never looked back.

05:05 Emily: I think that this advice is, one, good advice just for everybody, but two, something that academics or post-academics really need to hear, because we are kind of conditioned during graduate school to undervalue ourselves. And it takes really a lot of mental work–and for you a year and a half of actually working in your new field–to undo that conditioning, that mindset that’s been instilled in us. So, I think that it’s something that this audience really, really needs to hear. And I have found as I’ve been involved in academic entrepreneurship spaces, this is one of the top pieces of advice that we pass to one another, which is just raise your rates, raise your rates, raise your rates. I mean, we’re so conditioned. Yeah. We’re so conditioned not only to undervalue our time, undervalue our work, but also think that service is something that you have to do for your job, which I guess in academia, yes, you do have to, but outside of that, no, you should be paid for the value that you bring.

Courtney’s Course Covers Base Pay in Different Freelance Fields

06:09 Emily: So, anyway, it’s a wonderful, wonderful piece of advice. So, actually one thing I wanted to mention is, something I liked in your course is that you speak, of course your experience is in writing, but in the course, you cover a lot more than that, right? Freelancing is a lot more than just freelance writing. And so you talk about base pay rates that you can kind of expect in different fields. Right? I thought that was really that you just got the research jump-started a little bit for the people in the course.

06:40 Courtney: Yeah. You know, for me, I’m basically almost a hundred percent at this point, just a writer, but I actually have a lot of experience freelancing in other areas also, including doing editing and data science and different things. Because you can dip your nib in a lot of different freelance niches. And I also wanted to make the course really open to people who have different skill sets from what I have. Not everybody’s an anthropologist. They have different things, different skills that they bring from academia that they can earn good money from in freelancing also. And so, the course actually introduces several different popular niches, including writing and editing, translation, data science, consulting, sales, and marketing. So, you can kind of discover which one is the best fit for your current skills.

07:30 Emily: Yeah. I mean one of the fields you just mentioned, consulting, is always one that’s very attractive to me when I find other PhDs or graduate students who are consulting. One, because it’s a very broad in flexible kind of terms. So, a lot of people can be consultants in different ways, but also because it tends to command a nice high pay rate if you’re consulting in an area of expertise. I mean, you mentioned earlier that when you went into freelance writing, you were kind of moving away from anthropology. You were writing more about business. But you know, many other people who might be listening to this, they want to double down in their field of expertise. Right? And that’s how they can command those really high pay rates that you mentioned earlier.

08:07 Courtney: Absolutely.

Get Noticed as a Freelancer

08:07 Emily: Okay. So, let’s say you’ve convinced people, people are in your course, they’re going to go down this freelance route, whether it’s writing, consulting, some other field. What’s the best way for them to get started kind of hanging their shingle and letting people know I’m a freelancer now, you can hire me?

08:27 Courtney: Yeah. So, I think the first and most important thing is to build a website. Which, surprisingly to me, I know a lot of people in academia who were like, “Wow, you have your own website. That’s so cool. I wish I could do that.” And I’m like, “Well, you can. You can set up a website in one day. It’s not very difficult.” Yeah. So, building a website is the first and most important thing you can do to make yourself look like a professional freelancer. And that is another thing I discuss in my course. I take you through step by step, how to buy your domain hosting and set everything up, and what the important information you should put on your freelance website to make yourself look like a professional. So, that’s the first step.

09:02 Courtney: And then the next thing that you should do is use networking and cold pitching to get clients. Because there are a lot of freelance websites out there that you can get on where you can apply for jobs and stuff. And I’m not kicking that. I think that’s great also. And I do recommend that you do that, but you won’t get really high-paying clients from those kinds of gigs. You want to first start with networking. And even if you don’t have anybody, you can’t get any clients through your personal network. That’s fine. You can do it through cold pitching. And for me personally, over the years, the clients that I’ve had that have earned me hundreds of thousands of dollars are always the ones that I got through cold pitching. So, that’s what I recommend.

09:43 Emily: Yeah. You know, I actually went through a similar process. I don’t, I guess, identify as a freelancer, I identify as a business owner. But I went through a similar process when I started my business, which is how do I let people know that I’m available for speaking engagements and the other work that I was doing? And so I went through several years as I was building my network where I was cold emailing people. So, I know I don’t really love to be on the receiving end of most cold emails. And so I don’t love to send them either, but honestly, that was the necessary step in the overall process. So, I did a few years of a lot of cold emailing, built up my network, got some responses from that. And now I have basically stopped that. I kind of only do warm-emailing or cultivating my existing network at this point. So, I like that I’ve moved past that, but I feel like it was a really, really necessary start to the whole thing. My business would not have gotten off the ground if I hadn’t just been reaching out to people and trying to start establishing that network. So, it’s not necessarily pleasant, but it is necessary.

10:46 Courtney: It is necessary. And I always found it intimidating in the beginning, especially because you can send 50 emails and not get a response on a single one of them. That’s just the reality of cold pitching. But once you get that one gig and then it earns you a bunch of money, and then it’s like, “Oh, totally worth it.” And you feel motivated to do it more. And so, it can be intimidating. But that’s another thing that for the people who sign up for my course is that they have email support from me. And so, I will help them out with any questions they have. So, if they want to start cold emailing, but they’re not really sure where to start or what to say, they can ask me about that and I’ll give guidance based on the experience that I’ve had over the years.

How Freelancing Enhanced Courtney’s Life

11:28 Emily: That’s actually really nice. Because I know one of the sort of major challenges when you’re starting a business or starting a side income, like freelancing could be at first, is not really having colleagues who you can talk with about the work that you’re doing. And so, that’s just a really great sort of addition, in addition to the excellent content in your course, is also to be able to have interactions with you to get that support, again, as you’re building your network of your peers who are also freelancing or doing other kinds of work like that. So, I find that really valuable. I’ve been part of a couple of communities and I love just, you know, some people process things by talking to other people and they want some outside input, and you’re providing that. So, that’s super valuable. Now that we’ve gotten those excellent nuggets of advice from you, let’s talk a little bit about you and your story. I know you gave a quick overview at the start of the interview as to how you got into this, but why don’t you dive into a little bit more detail about what freelancing has done for you?

12:30 Courtney: Yeah, so, I flew through my bachelor’s degree and flew through my master’s holding my breath. I did that all really young and then I was starting my PhD. By the time I started my PhD, I was completely burnt out. It was just, I don’t need to explain how difficult academia is to anybody who’s listening to this podcast, but yeah, it was just too much for me and I needed a break. And the thing that I always loved about anthropology, the one thing that I love the most about it was being able to do field work. But field work was something that I was only ever able to do, if I was lucky, one or two months out of the year. And the rest of the year was spent in a windowless office doing research and data entry and stuff like that.

13:17 Courtney: And so, I wanted to just have the field work experience without the office experience. I just wanted to do something different. And so I was like, “Okay, I’m going to move to my field site. I love it there. I think it’s great. And I want to go live there. How can I do that? I don’t know.” And so, I actually ended up talking to my mom about it, who she actually works online. And she’s like, “Well, why don’t you start freelance writing? You don’t need to earn a lot of money in order to earn a living, especially if you’re in Africa. So, just give it a go.” And so, that’s what I did. I dropped out of my PhD program. I sold my car, used that to buy a plane ticket, and I left and I started freelancing here in Ethiopia and I’ve actually been here ever since.

13:59 Courtney: So, that has enhanced my life a lot because I get 12 months of sunshine, which is really important to me. And I love the environment and I love the culture and learning languages. And so that location-independence was really, really valuable to me for my mental health and just my personal happiness. And then the other thing that is always important is money. So, I earn very, very good money as a freelancer. I didn’t the first year and a half, as I mentioned before, but once I figured out that I was worth it, I started demanding it and asking for it. And I got it. And I continued to get it every time I raised my rates. People say, yes, somebody says yes. You know? And so, that’s really important, especially compared to academia, unfortunately. After the first two years of freelancing, I started earning more money than my former PhD advisor earns. And they’re a tenured professor. So, that’s something.

Location Independence and High Pay Rates

14:58 Emily: Yeah. I want to explore each of those points a little bit more because they’re both super attractive. The first one, the location-independence, you explained how that played out in your life. It enables you to move to the place that you want to live at one of your field sites and have sort of your whole life feel a little bit more like what you enjoyed the most about your academic experience. And of course, if someone else wants to do that and wants to make freelancing the way they make it happen, that’s awesome. I can think of some other benefits, which is, as you know, academic careers and PhD careers, you don’t have a lot of control over where you live, especially if you’re in academia. But even if you’re just a highly specialized professional, there are certain industries that are concentrated in certain cities, and so forth.

15:44 Emily: So, there may be reasons related to your PhD why you want to stay in a certain place, and this freelancing can follow you wherever you go. Side note, I as a, what’s called a trailing spouse–so we live where we live because my husband’s job is here and we anticipate moving because my husband may be changing jobs from time to time and he’s highly specialized–I get to take my business wherever I go. So, I don’t have to start over in a new job every time I might need to move. So, that’s a real, real benefit that I see that location-independence. And then of course on the money side, because this is a personal finance podcast. So, commanding the high pay rates, getting paid very well for your time.

16:26 Emily: Not just for people like you who are doing this full time, but as a side hustle. If that’s the way this starts, or that’s the way you want to keep this as you move forward in your freelancing career, as well as your academic or PhD-type career. It’s really nice when you can make a good amount of money for not that much time invested. As a PhD student, for example, you might be able to work, I don’t know, two hours a week, five hours a week, some pretty small number, but still get a really, really nice amount of money out of that small, small side hustle. And when you compare that, when you’re thinking about hourly rates to the other kinds of work that some PhDs do, or some people do when they’re still in graduate school or PhD training, it’s really nice, right?

17:10 Emily: To not have to work so many hours and also to have maybe a more like stimulating type of work, intellectually that is, yet something that is different probably from what you’re doing as your main day to day job, if this is still a side hustle. I think that’s really attractive in terms of having balance in your life. It’s awesome that you’ve been able to command these high pay rates and put together this full-time career, making a very nice income from Africa, from where you wanted to live. And I definitely want others to consider following your tracks.

17:44 Courtney: You were saying that this is like a full-time job for me, which it kind of is. But a lot of other people who listen to your podcast are people who are in academia to stay and they would like to have some additional stream of income to add on top of that. So, one point that I would like to make is that I actually do not work full-time. I work maybe 15 or 20 hours a week. But I actually still earn a full-time income because I get paid well. And this is something that I choose for my personal life because I have three foster kids and I homeschool them. And between that, and being a mom and, keeping my yard clean, I work 15, 20 hours a week on freelancing and that’s about it. And so you could do this as a part-time gig and still earn a lot of money. It doesn’t have to become like your full career. You don’t need to invest a hundred percent of your time in it. I don’t even invest a hundred percent of my time and I don’t even have another source of income. So, that’s something.

18:41 Emily: Yeah. Thank you so much for adding that. That’s awesome that you’re earning this like great, full-time income from part-time work. I actually also work part-time as well. I work about 25 hours a week and I’m quite happy with that balance actually. So, I really like that you added that point because the whole working 40 hours a week thing is so job-centric. That’s what our culture has decided–well, really not just 40, much more than 40 hours a week–is like the proper amount of time to be working. And once you start your own business, once you strike out on your own, all the rules are out the window, right? You can define what you want your work life to look like completely. And that goes both location and time and amount of money as we talked about earlier. So, I’m so glad that you added that. Thank you.

Endless Freelance Income: What to Expect

19:28 Emily: Let’s say someone is super excited about what we’ve been talking about. They want to start down their freelancing career in whatever field that might be in, and they want to sign up for your course, which again, they can do through pfforphds.com/freelance. And you can get the couple of bonuses that I created there. So, what can someone expect to find when they start your course?

19:49 Courtney: Okay. Well, first I guess I’ll explain who the course is for specifically. After I started freelancing, even in the first year or two I started freelancing, I got emails from people that I know. From people in my former cohort, professors that I know, people in grad school who heard, “Hey, I heard that you left academia and started freelancing. And I’d like to do something similar. Can you give me some advice?” And so, I’ve been giving advice to people for years. I get emails several, 10 or 15 times a year, I get an email from somebody, or I get a referral from somebody who’s in academia and they want to make the switch, or they want to add on to an additional stream of income through freelancing. And so, after years of basically kind of helping people just as like a side project, I decided to create a course to basically do what I was already doing, but do it in a more organized and formal way to help people.

Ch. 1: Intro to Freelance, Ch. 2: Identify Your Valuable Skills

20:47 Courtney: So, that’s what I created this course for. It’s called Endless Freelance Income, how to turn your liberal arts degree into an endless freelance income. However, even if your background is in science or any of the STEM areas, it can also be relevant to you. So, the course at the very beginning, it just introduces you to the online freelance world. So, if you don’t know the first thing about it, don’t worry. I will explain it to you in the course. That’s the first chapter. And then the next chapter, which I think is probably the most valuable one for people, is helping you identify what your most valuable and profitable skills are, from academia, that you can translate into freelance income. Through the mentoring there, I also kind of help people–people tend to overlook their skills. They think, “Oh, I guess I can write,” or like, “I guess I can do some data analysis, but I don’t have a degree in that. So, I’m not qualified to do that.” So, kind of just help people break that down. Imposter syndrome follows you outside of academia. I learned that the hard way. And so, just kind of help people to understand, no, these are valuable skills and you can utilize them.

22:08 Emily: What I liked about that portion of your course, what I noticed there is that you have worksheets in here, right? So, it’s not just like, I’m just reading all this material. It’s a very engaging format, right? So, you’re giving people some little tools they can use to do things like brainstorm about their own skillsets, which I totally agree with what you said. We tend to discount our own skills or our own areas of expertise unless we have a degree in it. That’s very important to us in academics that we have a degree in XYZ. But I know, personally, like my field is now personal finance and I don’t have a degree in personal finance and that’s okay. I’m still confident at this point that I am an expert in this area because of my long experience. But I think that for people who aren’t quite there yet, it is a little difficult of a hurdle to overcome. So, your course definitely helps with that.

22:55 Courtney: Yeah. And you know, same story for me, I’m an anthropologist, but I write in marketing topics, marketing and entrepreneurship. And I am an expert because I became one. And that’s it. And so, you can do it, too. That’s basically what the course helps you to figure out. So, once you’ve kind of broken down and pulled your skills out, then the next chapter teaches you about several different major freelance niches that you can get into. And I already mentioned before, there’s writing, editing translation, administrative support, design and creative, customer service, consulting, data science analysis, and sales and marketing are the ones that I go through. So, those are the main ones. And then it walks you through how you can look at your current skills and line them up with what each of these niches demand, or what they need.

How to Look Professional as a Freelancer

23:46 Courtney: And then it also helps you think about which one’s most interesting to you too. Because it’s not just about your skills, it’s also about what you want to do, right? And then you can choose your niche. And then after that, the course goes through how to make yourself look professional as a freelancer. One thing that I discovered when I left academia is that I needed to tone down my CV. What’s professional in academia and what’s professional in the online business world are very different. And so I kind of teach people how to make yourself look professional online as opposed to professional as a 10-page CV, or something like that. So, that’s the next step. And then the next thing after that is teaching you how to research your niche so that you can figure out what the going rates are in your niche, the going rates for somebody with your skill level, and just kind of also to weed through the riffraff.

24:47 Courtney: Because a lot of people out there, you know, they say $10 an hour or something like that. Yeah. You don’t need to pay attention to those people. So, to figure out how much you should be charging in the beginning. And then after that, the course takes you through step by step how to create your website, which I mentioned before. And then it walks you through what you need to do to land your first client. And that is the course in a nutshell, as it is right now. I plan to add onto it. Like I said before, I think cold pitching is important. So, one thing I plan to add on to it in the future is more information about walking people through how to set up a cold pitching scheme. And so, that’s something I plan to add onto it in the future. And the good news is that if you have access to the course, you buy it now, you’ll have access to all that future material as it comes up.

Bonus Content from Emily

25:34 Emily: That sounds awesome. As I said earlier, I read through the course prior to this interview, and it really breaks things down and simplifies them and doesn’t make it seem so intimidating to start down this path of freelancing. You really don’t over complexify anything. It’s very simple steps to follow, to get started. So, I wanted to mention for my audience, if you choose to buy Courtney’s course through my affiliate link again, pfforphds.com/freelance, I’ve created a couple of extra bonuses for you. So, one that everyone will receive who buys through my link is a free video training on how to budget with an irregular income, right? So, like I’m really confident, you go through Courtney’s course, you’re committed to this. Like you’re going to be starting down that path of having freelance income.

26:18 Emily: And you know, that’s a really great thing, but it can also pose some budgeting challenges. So, I’ve created a training that you’ll get for free when you buy the course on how to manage that. Like manage your finances when you have a side income stream that’s irregular, maybe growing into a full-sized income stream over time. So, it’ll help you with that. And then for the first five people who buy the course, so not everyone, but just the first five, I’m going to offer a free 20-minute financial coaching session. So, what I think will be really great about this is if you schedule this for maybe like two months out from when you start taking the course, it’ll be a nice little accountability point to meet with me at that time and say, “Okay, Emily, here’s the income stream. I’ve established it. I got my first invoice over here. I’ve gotten paid for the first time.” And so we can talk more about what you want to do with that money. How it’s going to help you reach your goals. How it’s going to fit into your budget. Do you want to be paying debt? Do you want to be investing it? So, we can talk about all that kind of stuff. So, that’s how I recommend you use that bonus if you’re one of the first five to sign up is schedule it a little ways out. So you actually have that income stream established by the time we meet together. And I’ll certainly be asking you, have you been implementing everything from the course? So again, pfforphds.com/freelance is where you can sign up and of course link through to find out more about the course from Courtney.

Best Financial Advice for Early-Career Academics

27:38 Emily: So, Courtney, we’ve come to the end of the interview. Thank you so much for what you’ve shared with the audience today. I think it’s been excellent advice and thank you for telling us more about Endless Freelance Income. So, final question that I ask all my guests is what is your best financial advice for another early career academic or maybe recovering academic like you?

28:00 Courtney: My best advice would be don’t put all your eggs in one basket. Something my dad told me when I was 17 years old and I didn’t know what it meant at the time, but now I do. So, even if you’ve got your dream job, even if you’ve gotten that research position or that tenure track job or whatever, you never know what’s going to happen in the future. That’s something we’ve learned this year in 2020, I think. And so, having an additional stream of income is really valuable. And I know that’s what Emily talks about all the time on her blog. And the thing about freelancing is that there’s no risk in starting and giving it a try. And you can just work on it in your spare time and you can build it up over time in whatever time you have. And if you don’t have time to work on it, you don’t have time to work on it. And it doesn’t hurt you to work on this and build up this extra stream of income. You don’t have to be like me where you leave your job and leave your country and change your whole career. I think that all academics should be doing something on the side, some kind of freelancing, blogging, something. So, that’s my advice.

29:06 Emily: Yeah. I totally agree. You know, not all the eggs in one basket can apply it to a lot of different areas, but certainly when it comes to your income, having a job or even being in graduate school means you’re dependent on another institution to decide to continue to give you work. But the advantage of freelancing is that you spread that around to a lot of different clients and it’s much less risk. Yeah, one client drops off, no big deal. You can supplement that by hustling up a few new clients. But if your employer decides they don’t want to work with you anymore, that’s kind of a devastating like life thing. So, excellent, excellent advice. What I also like about what you said is that if you do the work, for instance, by going through your course. If you do the work to establish yourself as a freelancer, and you devote even something like an hour a week to it, like I mentioned earlier. As long as that income stream is established and in a field like freelancing, it’s something that you can decide to turn up or turn down as you need in your own life.

30:00 Emily: So, for example, if you have an unfunded summer, you know, some people–again, you mentioned 2020–some people in 2020 have late in the game discovered that they don’t have summer funding in the way that they thought they would. Yes. Their funding will pick up again in the fall. It’s not like they’re going to drop out of graduate school and get a full-time job or whatever. But for a few months, the income that they thought was secure is not there. So, once the situation is upon you, it’s very difficult to scramble and kind of fix it. But if you’ve already established that one hour per week freelancing job, then that’s something you can ramp up or ramp down as your life allows, as your money situation requires. So, I just think that’s a real advantage to establishing yourself. Even if you’re not going to do it, like you just said, 15 hours a week to make the equivalent of a full-time income. So, great, great advice. Courtney, thank you so much for joining me on the podcast today. It was a real pleasure to talk with you again.

30:54 Courtney: Thanks so much, Emily. Thank you.

Outtro

30:55 Emily: Listeners, thank you for joining me for this episode. Pfforphds.com/podcast is the hub for the Personal Finance for PhDs podcast. There, you can find links to all the episode show notes and a form to volunteer to be interviewed. I’d love for you to check it out and get more involved. If you’ve been enjoying the podcast, please consider joining my mailing list for my behind the scenes commentary about each episode. Register at pfforphds.com/subscribe. See you in the next episode! And remember, you don’t have to have a PhD to succeed with personal finance, but it helps. The music is Stages of Awakening by Podington Bear from the free music archive and is shared under CC by NC. Podcast editing and show notes creation by Meryem Ok.