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Stipend Data and Strikes on the Path to a Grad Student Union

March 24, 2025 by Jill Hoffman

In this episode, Emily interviews Garrett Dunne, a 5th-year PhD candidate in the College of Fisheries and Ocean Sciences at the University of Alaska Fairbanks. Realizing that they were being dramatically underpaid, Garrett and his peers used the data from PhD Stipends to advocate for a significant stipend increase in their department. Subsequently, they joined up with grad students in other schools within the University of Alaska system to unionize and bargain for better pay and health insurance. Garrett’s account of their relatively quick process includes several concrete tips for graduate students at other universities who are advocating to increase their stipends and improve their benefits, including who is in the best position to lead the charge.

Links mentioned in the Episode

  • PF for PhDs Tax Workshops
  • PhD Stipends Database
  • PF for PhDs Tax Center for PhDs-in-Training 
  • PF for PhDs Subscribe to Mailing List
  • PF for PhDs Podcast Hub
Stipend Data and Strikes on the Path to a Grad Student Union

Teaser

Garrett (00:00): Disturbing and depressing is probably the best way I can put it. And so it, it does take students that are in that position of safety and strength to then advocate for the people who are a lot more vulnerable.

Introduction

Emily (00:19): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (00:47): This is Season 20, Episode 6, and today my guest is Garrett Dunne, a 5th-year PhD candidate in the College of Fisheries and Ocean Sciences at the University of Alaska Fairbanks. Realizing that they were being dramatically underpaid, Garrett and his peers used the data from PhD Stipends to advocate for a significant stipend increase in their department. Subsequently, they joined up with grad students in other schools within the University of Alaska system to unionize and bargain for better pay and health insurance. Garrett’s account of their relatively quick process includes several concrete tips for graduate students at other universities who are advocating to increase their stipends and improve their benefits, including who is in the best position to lead the charge.

Emily (01:32): The tax year 2024 version of my tax return preparation workshop, How to Complete Your PhD Trainee Tax Return (and Understand It, Too!), is now available! This pre-recorded educational workshop explains how to identify, calculate, and report your higher education-related income and expenses on your federal tax return. Whether you are a graduate student, postdoc, or postbac, domestic or international, there is a version of this workshop designed just for you. I do license these workshops to universities, but in the case that yours declines your request for sponsorship, you can purchase the appropriate version as an individual. Go to PFforPhDs.com/taxreturnworkshop/ to read more details and purchase the workshop. You can find the show notes for this episode at PFforPhDs.com/s20e6/. Without further ado, here’s my interview with Garrett Dunne.

Will You Please Introduce Yourself Further?

Emily (02:44): I am delighted to have joining me on the podcast today, Garrett Dunne, who is a fifth year PhD candidate at the University of Alaska Fairbanks. And we are going to discuss increasing grad student stipends through a couple of different mechanisms. And I, I won’t say more than that now, but hopefully you’ll take away a couple of actionables that may be applicable at your own university as well. So, Garrett, would you please introduce yourself a little bit further for the audience?

Garrett (03:08): Hi, everybody. Uh, I am Garrett Dunne. Uh, I’m a fifth year, as you said, PhD candidate, university of Alaska Fairbanks. I study, uh, two species of a shark in Alaska. Um, I’m trying to improve the federal stock assessment for those two species. Uh, I did my undergraduate work at Eckerd College in St. Petersburg, Florida, and then I did my master’s degree at Northeastern University in Boston, Massachusetts. But did my field work in, uh, based outta Biloxi, Mississippi in the, uh, Gulf of Mexico. The naming has changed, but I’m gonna go with Mul- Gulf of Mexico. Um, and then I have been working on and off in Alaska for about the last decade, uh, primarily on fishes. I started with Salmonids and then transitioned into sharks, which is my true passion. But, uh, salmons where the money is made.

Emily (03:53): Wow, okay. You’ve lived all over the place. I was gonna ask if you’re an Alaska native or anything, but it sounds like you’ve been living there on and off for 10 years.

Garrett (04:00): Yeah, originally I’m from New England. I split my time between New Hampshire and Massachusetts, but I really have kind of lived all over the country. Um, and I settled in Alaska full-time about four years ago now,

The Impacts of Low Pay and Poor Healthcare in Grad School

Emily (04:12): Speaking of four years ago, that is when we first started our email correspondence. <laugh>, uh, the listeners, sometimes it takes this long to our podcast episode to get into production. So, so four years ago you emailed me about the project that I have going on PhD stipends, PhDstipends.com, which is a database of self-reported stipend information all across the US and actually outside the US as well. So let us know, like what was going on with you back in 2021ish, like what was the pay you were receiving the benefits and like what led you to reaching out about this dataset?

Garrett (04:47): Unsurprisingly, it was because the pay and, uh, university healthcare was underwhelming. So, uh, in 2021, uh, there was a bunch of different levels within my college. University of Alaska Fairbanks breaks up the way that they, uh, pay students one by college and then usually within the college. It’s multiple different levels, but for sake of ease here, if you averaged out what master’s students were making at different levels and PhD students were making at different levels, uh, in 2021, the average salary was, uh, about 21,500 annually for a graduate student at UAF. Um, and the, to further complicate things that really depended on, uh, what type of funding you were through, um, the UAF and kind of UA system is funded through a very large patchwork of different ways to be funded. I, myself have been funded as a TA, RA and fellow, uh, throughout my five years. Um, and at different times and in different orders. I started as an RA, moved to fellowship, moved to TA, and now I’m an RA again. Um, so it’s a bit complicated and the numbers change a little bit depending on what style of funding you have. Um, sadly, uh, after my first year of being an RA, I moved to a fellowship, um, and in some ways that was easier, uh, but it did not leave enough room for summer funding, so I was unpaid in the summers. So while my take home should have been 21,500, my effective take home, because of the lack of pay in the summers was about 17,000, um, which is quite low. And the cost of living in Alaska is very high. Um, the federal government adjusts, I think their numbers from I think 1.25 or 1.5 times the poverty line, uh, for Alaska and to, in 2021, the poverty line was $16,000 a year, um, in Alaska. So, uh, as a graduate student in the sciences, I was being paid a thousand dollars above the poverty line, and I was forced to take, uh, additional work on in the summers. Um, I didn’t mind taking on that work. It was something that I got to, uh, I I’ve always enjoyed and actually did before going back to graduate school. Uh, but it has significantly delayed my progress on my dissertation. Um, and so yeah, we kind of came to, uh, the realization as a college that we just were not being paid enough. Um, and too many people were living at near poverty levels, and we wanted to, uh, push the graduate school to do better. And most of this work was led by the student organization within my college, so the, the, uh, fisheries student organization where people realized that the healthcare was poor and that, uh, we were being underpaid. And because of this patchwork nature, people were going from making $21,000 a year to me then making 17 a year, and then I wasn’t even sure if I was gonna get paid the following, uh, year. So, uh, quite complex as far as things go.

Emily (07:44): Also, shocking shockingly low numbers for 2021, as you said, in a, a relatively high cost of living area. Um, wow. I mean, I know you just sort of offered part of the effect on your own personal finances, which is that you had to take outside work in the summer, which has then, you know, therefore you’re not working towards your dissertation and that’s gonna push things out. Um, would you be willing to share with us anything else that you experienced on that low stipend at that time or maybe that you observed your peers experiencing?

Garrett (08:16): Yeah, for me personally, it was just I had no ability to save. Um, and so I was living very much paycheck to paycheck. I was in the privileged position of coming into, uh, my PhD with no major debt. Um, so I didn’t have major debt from undergrad or large car loans or a, a home loan, anything like that. And, um, I was living paycheck to paycheck. Uh, and so for others that I had spoke to people coming in with undergraduate debt or master’s debt or medical debt, which is a huge problem in the United States, um, they were actively losing money. Um, and so they were dipping into their own savings to be able to have the privilege of going to the graduate school. And it was becoming a real problem. And once we started digging into it, one of the reasons that we were paid so low was that we realized that the college had not given a pay raise to graduate students since 2008. So we were in 2021, and we had not gotten a pay raise since 2008. And so in 2008, the pay was actually fairly competitive and did keep up at least somewhat with the cost of living in the area. But I used the data set that you provided to then look at how we were being paid nationally and even in compared to low cost of living areas. Um, at 21 5, we were being underpaid. And then you had students like me who were making just above the poverty line, uh, and we were obviously being deeply, deeply underpaid. And so we took this data set. I did most of the data analysis and just kind of made box plots and just looked at the fact that we were being paid underpaid nationally. Um, and within specifically art disciplines, I used your dataset, got rid of everything that didn’t have to do with kind of biological science, and we were still being underpaid, um, nationally. And again, we, we <laugh> we live in a relatively high cost of living area. Yeah, it is not one of the major coastal cities, but Alaska’s expensive and especially the stuff that graduate students need, food is very expensive. Housing used to be inexpensive. Um, that has changed actually just really in the last five years, especially in, uh, the major campus areas, which would be Anchorage Fairbanks in Juneau. Um, I don’t live in any of those partially because of the high cost of living. Um, but with food and shelter being expensive, uh, it really, really dips into our ability to, uh, survive up here, um, and not have to dip into savings or take out loans, which, uh, many other students did.

Emily (10:40): Yeah, so the, the data from PhD stipends, okay, first of all, I was in graduate school in 2008 <laugh>, and those numbers are still not that rosy. Um, especially I was even in a moderate cost of living area and I was being paid more than that. Um, yes. Okay, so <laugh>, your lived experience is were barely above the poverty line. People are having to, you know, do outside work and these kinds of things to, to get along here. That’s your lived experience. Then also, you look at this data set and you’re like, wow, wow, wow. Okay, everybody else across the board is getting paid more than us. What, what was the, and you did this data analysis and then what was the next step that you took, like with approaching the administration, for example?

Using Data to Negotiate a Long Overdue Pay Increase

Garrett (11:20): The last part of that analysis was looking and saying, okay, so we are being underpaid. And then, uh, actually adjusting, using the federal numbers to adjust what we were being paid to the current marketplace. So taking in co- uh, inflation and the fact that the federal government says that our poverty le- poverty level is higher. And so our average was 21500, adjusting for all of that. It was about 30,000 is what we should have been paid in 2021 compared to what it was in 2008, which I think is definitely more competitive. Still not that competitive, but more competitive. Um, and so our next steps after having those numbers, having this write up in all of this data analysis was mostly getting, uh, at first graduate students riled up. I mean, all of this came outta the fact that we kept having these student meetings and all these graduate students were saying, I can’t pay for the healthcare. I’m having to ch- choose. I’m having to ration meals I’m having to live in. Um, uh, one of the unique experiences, the University of Alaska Fairbanks is dry cabin living. And it is not something that a lot of people think about. Fairbanks gets incredibly cold. Uh, last winter we hit negative 50 Fahrenheit, so aggressively cold. So heating buildings is not always feasible. And so a lot of the cabins do not have running water. And so a lot of graduate students have had to resort to living in dry cabins that are heated in a variety of ways with no running water.

Emily (12:44): That’s a new one for me. Wow. Yes.

Garrett (12:46): Yeah. And so that had used to be the way that you could save money and attend the university is an experience. Um, and not everyone dislikes it, but it is a difficult one. Um, and those dry cabins have actually gotten quite expensive. And so, you know, even when I joined the university in 2020, uh, those were usually 400, $500 a month and you could get a small cabin for yourself. Uh, those prices have skyrocketed close to a thousand dollars a month for the privilege to live without running water. Um, and so during covid, the university shut down shower access, we have lots of students living in dry cabins, so that got everyone quite angry. And then we all got together, decided that the pay was too low, the healthcare sucked, got us all angry, and then we approached our faculty. Um, and not all faculty were supportive, but my advisor was quite supportive. And a couple of new faculty especially were supportive of this because, similar to your experience, which was they looked around, they went, oh wow, we’re not paying these students enough. And they had seen other university systems and seen the conditions for other graduate students and were very supportive of bringing that forward. And so we got a large portion of the graduate students, a number of the faculty, and then we approached the dean. Um, and that is how we pushed forward with it and said, you are criminally underpaying us. Some people are living at or below the poverty line. Something needs to be done. Um, and we did effectively, uh, petition for a, a pay pay increase. Um, it wasn’t everything we wanted, but it was at least a, a sizable increase.

Emily (14:17): How long did that take from, from the point of, um, I guess first approaching the dean to the pay increase? What was that timeline?

Garrett (14:27): The timeline for approval was surprisingly short. I think that was about a month, two months of negotiation. Um, we did have to wait to the next fiscal year for it to be implemented, however, so that took a a bit longer. Um, I think the problem was we had told the dean a problem for him was that we had told him that we were gonna start going to the papers. Um, the fact that we had students living in poverty and squalor, um, was a real problem and it was gonna look really bad for the dean and the university. Um, we were also significantly underpaid compared to the other science disciplines within the university program. Um, the other colleges, uh, in, in other sciences especially, uh, geoscience, aerospace, those kind of programs are quite well funded. And as I said, we hadn’t gotten a pay raise since 2008, so it was, uh, a bit of an issue.

Emily (15:19): So you used PhD stipends, but you also were gathering data from your peers at your university?

Garrett (15:24): Yeah, absolutely. And just saying that we were even being underpaid within the university system, so PhD stipends was absolutely one of the best ways we could say, look, not only are you underpaying us compared to these other colleges, but like you are underpaying us nationally and it’s expensive to be here. Um, so yeah, it was, it was kind of a double whammy.

Emily (15:43): One of the, I guess, points of criticism about PhD stipends that I’ve heard from other advocates is at least that what they heard when they presented the data was, this is self-reported. This has not been verified by anybody. Did you get any pushback like that or was it just so obvious in your case that we overlook that?

Garrett (16:04): Uh, I had to do a lot of cleaning of the dataset to make sure that we were getting out outlier values. ’cause there are definitely some things that have been mistyped and, you know, we had to take out some of the small values and some of the extreme values where you’ve got somebody who’s counting their stipend as like they’re being paid by a tech company to go back to school and they’re reporting that they’re getting 80,000 or $90,000 a year to go back to graduate school. We had to pull all of that out, but we really didn’t get much pushback on it because it was just so obvious that we were being underpaid. Even if some people were misreporting and there were some outlier values still contained within it, um, yeah, we didn’t get much pushback and the fact that they hadn’t given us pay raise since 2008, pretty much just it was self-explanatory, uh, that we, we something needed to be done.

Emily (16:47): Absolutely.

Commercial

Emily (16:50): Emily here for a brief interlude! Tax season is in full swing, and the best place to go for information tailored to you as a grad student, postdoc, or postbac, is PFforPhDs.com/tax/. From that page I have linked to all of my free tax resources, many of which I have updated for this tax year. On that page you will find podcast episodes, videos, and articles on all kinds of tax topics relevant to PhDs and PhDs-to-be. There are also opportunities to join the Personal Finance for PhDs mailing list to receive PDF summaries and spreadsheets that you can work with. Again, you can find all of these free resources linked from PFforPhDs.com/tax/. Now back to the interview.

The Unionization Movement at University of Alaska

Emily (17:41): And so the next step was you achieved this big win for your department, um, but then you rolled this into a larger movement. Can you tell us about that larger unionization movement?

Garrett (17:53): Yeah, yeah. And, um, I don’t want to undersell this. So we were kind of having this conversation within our own college and push for the pay raise, and we actually got them to, uh, agree to a biennial, uh, pay increase as well, pegged to inflation, which was really nice for us, so we didn’t have to fight for it as often. And as a part of this, we started kind of hearing murmurs in the background that actually the, uh, some of the liberal arts colleges had already started talking about unionization. So I don’t wanna say that we were the, we were the start of this, but we did join in with a lot of gusto. And so we heard that there were other organization groups. And so, um, one of the main reasons that that started in the liberal arts college is to my understanding, they were being paid at or below poverty line at their maximum amount amount of pay. So most of these students were making between like 14 and $17,000 a year, and that was maximum if their summers weren’t paid for. Um, they were making $12,000 a year, um, well below the poverty line for Alaska. And so they had a lot more reason to be even angrier. So they kind of got things started and then we joined in in that process. Um, and so that the murmurings of that happened, I think around the time I got started, uh, in 2020. And then by 2020, late 2021, early 2022 is when things kind of got moving. Um, and I’m, I’m happy to talk more about kind of that process if that’s something you wanna dive into.

Emily (19:29): Yeah. Maybe give us like, ’cause it’s, I mean, we don’t need to motivate this. We obviously see the problem with the pay for the graduate students. Um, I’m more curious about, you know, at the time of either, um, you know, voting to form a union or starting to approach the administration about the contract. Like just go over how that process went for you all. We’ve heard it a couple of times on the podcast before, but every story is a bit unique, so I’d love to hear yours.

Garrett (19:55): Yeah, yeah, the healthcare seems to be one of the biggest drivers for us. The, the pay was always bad, um, for, for most of the graduate students, and that was always an easy one. But we are under United Healthcare Student Resources, um, and United has a reputation, um, deservedly so for being quite poor and frequent to deny pretty much any type of coverage. It’s actually, how I got involved in all of this was I spent about two years fighting with them. And so we kind of took these people who were upset about pay and very much upset about healthcare, and we were getting a lot of pushback from United and the, um, student, uh, healthcare manager at the university. And so we decided to say that we were not getting anywhere as a group. And so we started talking internally and seeing what it would take to form a union. And so it was starting to take like, you know, the, the student organization out of the, the College of Fisheries and Ocean Sciences, which is the college I’m in, and finally meeting with the, um, you know, a lot of the liberal arts colleges, many colleges have this problem or universities have this problem where the different colleges are quite separate. Alaska is specifically difficult, um, because we are so spread out. It is a giant state. The UA system, since it is integrated, we actually had to, uh, unionize across all of the colleges. We could not just unionize UAF or UAA. And so it was trying to get all the graduate students from all the different colleges to gather in enough of a critical mass to then move forward. So that was step one was just trying to get these meetings and get enough, uh, frankly upset students <laugh> together to say, okay, so this is something that we actually do want to do.

Garrett (21:35): The next step from there was then saying, okay, we need to start picking people who have time and ability to then, um, become officers and really lead the charge. Uh, I was one of the officers during that push, um, but I was definitely not one of the leaders. I I was just kind of there to help do paperwork, reach out to people, move forward and, and get in contact with people. And the, once we kind of had officers, the, the me- major next step was getting the word out and finding union representation. And that was, honestly, that’s one of the biggest key steps that in retrospect I see is just you can’t do it alone. You need lawyers and you need someone who’s actually been through the unionization process before because all of us officers were very engaged, very motivated, but we needed somebody to actually guide us through. Um, and so we approached two unions, one of which we never had much interest from, and then UAW so United Auto Workers, which I did not think would be heavily involved with graduate students in the United States, which they are, um, was really excited about working with us. And, um, kind of we got in touch with them, found somebody who was gonna be, you know, our, our union rep for this process and their set of lawyers, and that’s really where we got the ball rolling.

Emily (22:48): Wow. Okay. So the ball’s rolling on the unionization process. Um, I think the next step is like a, a card drive, like a signature drive kind of thing, and then, and then it’s starting to talk with the admin, right?

Garrett (23:01): Absolutely. Yeah. Yeah. And so card drive was next, and that was again, trying to make sure we had that critical mass of pissed off students before we kind of even got that ball rolling. Um, and that was really difficult, especially up here because I’m more in the Anchorage area and so I had cards shipped down to me UAF primarily. They have the bulk of the graduate students for the UA system. And so we were the primary university for driving this. We were shipping most of the cards everywhere, but it was really trying to make sure that we had representation of these officers in all these different places so we could go to offices, hand out cards, talk to people, um, because graduate students are bombed with emails, the best thing you can do is call people in this day and age, text people, um, emails sometimes work, but we didn’t always have the best response there. And it was really the officers in the background making sure we went through every graduate student collecting everyone we could and just reaching out over and over again to get those cards signed. Um, it was an incredibly successful drive. Um, the graduate students in the UA system are quite upset with kind of the general state of things, um, and that’s not always the university’s fault. There’s more information there we can always chat about. Um, there were some very large cuts in 2019 to the university system that have made it very hard to make things better for everyone, including faculty and staff. Um, but we got the cards together and then, uh, yeah, I mean we had representation and then we could approach the university, and then we went directly into bargaining, um, and we bargained for a contract if I’m not misremembering, within five months, which is unheard of. Um, getting from card drive to a, um, a, a formal union in, in a contract within a year is impressive. So we went quickly into bargaining and then had a contract within a year. Um, and we have signed and it is formed.

Factors that Accelerated the Unionization Process

Emily (24:48): Yeah, I’m also surprised by that, um, speed, especially given what you just said about there being university-wide, like funding cuts just prior. So like, what, what do you think, what were the factors that made that happen? And especially fast for you all?

Garrett (25:04): I mean, we were protesting a ton. Um, we were protesting on the University of Alaska, Anchorage campus, UAS and UAF, uh, UAF especially because we have the largest population of graduate students. We were regularly picketing the deans of the colleges and the deans of the college and ju- and the university. I mean, we were just being very loud and obnoxious. Um, and we were talking to several papers up here, um, really just getting the word out that we were very, very unhappy and that was the best thing that we could’ve done. Um, partially because the university is so resource strapped as well. Um, we got more than what we initially asked for as far as inclusion within the graduate school. Um, so we, it’s, uh, it’s a difficult thing to deal with, but you know, the TAs and RAs are very easy to say yeah, they’re employees of the graduate school, the fellows, as I talked about, it’s a much more washy area, but we actually managed to get all the fellows included as well, um, as well as some staff.

Garrett (26:03): There were a lot of weird kind of one-off students that are partially employed by the university also in graduate school, and we got a lot of those included as well. Um, the, the university did not play their hand particularly well, and the state was, uh, very sympathetic to a lot of our arguments. So, so it went quite well, uh, for us there. Um, yeah, and, and the speed was just because the university was tired of dealing with us. Um, we really wore them out. Uh, we did not get everything that we wanted within the contract. Uh, one of the big things that we had to jettison for the year was the, uh, healthcare. And so that’s what I care about most. But we had already signed a contract with United for that year, and so if we wanted a contract that at least locked in a floor for all graduate students for pay and a lot of other, you know, representation, grievance policies, things that really are, uh, a huge part of what a union provides and streamlining all of that, we had to wait for this year, which we are now going into bargaining for.

Emily (27:02): Hmm. So everybody, all parties knew that that was still gonna be renegotiated as soon as possible.

Garrett (27:07): Yeah, we wanted to, and absolutely it’s why I got involved and I was disappointed to see that that was the case. But the, uh, university just didn’t have time. They had already signed the contract with the United, so yeah, all parties knew that we were gonna be coming back to the bargaining table within the next year or two to, uh, work on that. Um, one of the fun things that we discovered through this whole process of discovery and requesting information from the university was for years we had been told that, you know, actually no, we, we look at this every year. We find the best healthcare for you guys and we’re really on it. And through discovery, we found out that literally they just check the mark. They, they ask for requests from three possible institutions, they pick the cheapest one and go with it. And turns out they’re pretty much just rubber stamping united every year because they United shifts most of the cost to the graduate students so they can provide the lowest cost to the university, uh, on the healthcare. For the record, we are also required to buy this healthcare. There is no way to opt out. Um, and it’s, uh, become quite expensive. It’s about $1,500 a semester now, and it was about a thousand dollars a semester, um, previously, and that’s before copays and, and all of that. Um, yeah, it’s, it’s poor coverage.

Post-Unionization Stipend Amounts

Emily (28:17): Okay. So forthcoming progress on the healthcare front, but in terms of the stipend, can you tell us like what’s the new minimum or like maybe what you’re making now versus what you were making before?

Garrett (28:29): Yeah, yeah. My, my experience is probably not the best one to go for, um, because I’ve now switched back to an RA ship and so I’ve gone back up to being paid, um, uh, quite a bit better and through the summers. So I’m no longer living at that kind of 17,000 and having to take on summer work. Uh, my new pay rate is closer to, uh, 25,000 a year, um, which is more reasonable. It’s not amazing, but it’s definitely more reasonable, um, if you average out all of the different pay steps that they still have within our college because while we put a floor through the union for the whole university system, um, our pay actually wasn’t affected all of that much. We just now get a regular annual increase peg to inflation, um, rather than, um, we, we didn’t see a pay raise ’cause we were already above that floor. Um, uh, the average now is about 27,000 a year. Um, and some graduate students are now making over 30,000, which, if you remember from when we were chatting earlier is in 2021, arguably kind of where we should have been, um, if we had actually, uh, kept giving pay raises with inflation that said inflation’s been rampant over the last four years or so, uh, post covid or, you know, whatever we wanna call this era of time. Uh, and so I would argue that we’re now should probably be paid in kind of the mid 30 thousands, um, if we were really trying to be, uh, competitive. But it is significantly better than it was, uh, although the healthcare is not where we would like it to be.

Emily (30:05): Okay. So on your personal side, the work that you did to, with your peers to, you know, advocate for increasing the stipends within your department, um, that was sufficient to bring everybody above the minimum that then was set by the union. So really it’s like both efforts were important, like that unionization part of it is not gonna allow you guys to drop below any floors. It’s going to make sure that everything is reevaluated on an annual or biannual basis. Um, but you had already done a, a great amount of legwork for your closer group of peers, but now we get to extend this to a much wider group within the university.

Garrett (30:42): Yeah, absolutely. And that was the case is the College of Fisheries and a lot of the science colleges didn’t see much of a pay raise. Um, we did get those locked in, you know, annual or biannual increases, uh, but it was really trying to keep especially our, our liberal arts colleagues from living in poverty. And so that was one of the privileges of being able to be a part of this was I was able to work before I went back to graduate school, I had savings and I was less concerned with, uh, retaliation from the university. And it was something that I felt good that I was able to provide was help, uh, help push through to help our lower paid colleagues who really just didn’t have a lot of, uh, leeway and, and ability to then argue, uh, without worrying about retaliation from the university. Um, and there were several times where retaliation seemed to be very much on the table. Um, the power dynamics of going through, uh, a unionization push was not what I expected it to be. Um, and it was, uh, difficult for sure.

Power Dynamics During the Unionization Process

Emily (31:41): Can you share any more about that observation?

Garrett (31:43): The power dynamics of, of some of these people who are leading colleges and paying paid hundreds of thousands of dollars against students who are living at or below the poverty line, taking out loans to survive and are deeply concerned that if they get sick or are living with chronic illness, they’re gonna fall into deep medical debt. Um, is, uh, it’s disturbing and depressing is probably the, the, the worst, yeah. The best way I can put it. Um, and so it takes often students that are in positions that are a little bit more stable and have support. Like I said, my uh, advisor was very supportive of both our push for, uh, a pay raise within the college and the unionization push, um, that I felt safe. And so it, it does take students that are in that position of safety and strength to then advocate for the people who are a lot more vulnerable, um, because they, they simply, the power dynamics don’t allow for them to be as loud.

Emily (32:42): Yeah. Thank you for pointing that out. I hope that for any listeners who are interested in this, who there’s not yet union representation for their campuses, that they’ll take a, you know, an eye to themselves and see am I in this more privileged position? Am I in a safer position to be able to advocate on behalf of my peers or am I, am I not? And I need to, uh, advocate within my peer group for somebody else to take on these, uh, bigger roles. But I’m really glad to hear that you felt like you were able to do that and, and carry through it with all this, um, wonderful progress. Um, would you say, so earlier, you know, you mentioned that like the main thing for you having the lower stipend was that you weren’t able to save anything. Are you able to save now?

Garrett (33:26): I am, yeah. Which is quite nice. Um, and primarily I’m saving up for unexpected car repairs and it is not a significant amount of savings, but it is, uh, much more stable and I don’t have to worry about going to the grocery store anymore, which is very nice. Um, and not having to shop all of the worst possible least expensive brands, <laugh> is also, uh, a bit of a relief. Um, and so I mean, one of the ways I was able to survive at that very low pay rate was, and I think this ties into uh, a question we’ll probably talk about more, is by creating a very, very detailed budget. I mean, I have a monthly spreadsheet that has all incomes, all outflows and then an annual up or down. And that’s how I kept track of the fact that I was actually generally losing money at that lower stipend level was that you could see, you know, month to month I was losing a couple hundred dollars. Um, I was in the lucky place to have some savings, so I was able to dip into that rather than taking out loans or asking money from friends and family. Um, but that is not the position for many graduate students that I spoke to pre uh, unionization push. So

Emily (34:32): Yeah. And do we really wanna select for graduate students who have worked prior to graduate school who have family support, et cetera, et cetera, or do we want graduate school to be a place that anybody can financially survive?

Garrett (34:45): Absolutely. Yeah.

Best Financial Advice for Another Early-Career PhD

Emily (34:46): Great. Well, Garrett, this has been such a wonderful story. I’m so glad that you came on to share it with us. Um, I would love to hear, uh, from you the answer to the question I ask of all my guests at the end of interviews, which is, what is your best financial advice for another early career PhD? And it can be something that we’ve touched on already or it could be something completely new.

Garrett (35:04): Yeah, I, I think I’m gonna echo a lot of the themes we’ve had during this interview. Um, is first is to pay attention to the entire compensation package. It’s not just to the stipend, but also especially for us, in my experience, the, uh, healthcare that’s provided, how expensive that’s gonna be, what your expected out of pocket is gonna be. Um, does university provide it? Do you get, pay it through your grants? Um, and then you need to really understand the cost of living in the area that you’ll be, uh, doing your work from. If you’re lucky enough like me to be able to do things remotely, you can reduce some of your costs, but a lot of universities I know don’t allow for that. Um, and so you need to see what your pay is gonna be, what your healthcare is gonna be, and any other kind of sneaky costs and, uh, costs of living are gonna be. Um, for me, uh, it was a benefit to wait to return to grad school, um, make sure that I had some savings and was able to, uh, have resources available in case of an unexpected car repair or a surprise cost, a surprise injury. Uh, and so I would encourage some graduate students to consider whether going directly to graduate school is the best option for them, depending on financial situation. Um, my fi- my, uh, budget spreadsheet or using an application for keeping track of your finances, I think is huge. Um, it, it really, really helped me when I was living at kind of the most, uh, spare ends of when I was being paid. And um, and then one of the biggest issues for me, and we haven’t really touched on this, but also looking at how long that funding that you have, uh, for your graduate program lasts. Um, I came into graduate school with only one year of funding and so every year I’ve had to reapply and it’s been a huge stressor for me and, and a big financial strain not knowing whether I’m gonna be in graduate school next year. I do not know if I’m gonna get paid. I don’t know if I’m gonna have my classes taken care of. I’ve been really lucky. I’ve managed to get all the way through and every year I’ve managed to find some form of funding, but it’s been really tight and very close in a couple ways. And so I think that is one of the things that’s most important is making sure that there’s enough money for at least your first many years and that it’s stable. Um, we live in a climate now where funding stability is much more in question and it’s definitely worth asking that, um, before you decide to go to any program.

Emily (37:22): Absolutely. Um, for like prospective graduate students, you know, looking at the offer letters and starting to do, uh, visits or interviews or what have you, um, what’s the best way do you think for them to find out some tricky things like that? You know, what is this insurance policy actually gonna cost me out of pocket? Um, that kind of information within this compressed time period of like the admission season.

Garrett (37:45): Yeah, absolutely. And that is the real hard part is you’re juggling multiple universities, multiple offers and trying to figure out how to navigate it all. Uh, graduate student groups are probably one of the best ways I’ve found. ’cause often that’s where a lot of the grievances are held and that’s where I got together with my colleagues and kind of figured out how to start pushing forward towards action. So any of the graduate student groups in the colleges that you might be going to great people to reach out to, um, other graduate students within your lab, um, often I would argue the ones that are farther along tend to understand the systems a little bit more and be a little bit more honest about the difficulties that they’ve had within the system. Um, and that those are probably my two biggest resources. They tend to be the most honest about both the benefits and drawbacks of those institutions. 

Emily (38:32): Yeah. They’ve had time to see maybe some edge cases play out, like, uh, oh yeah, this is normally how things go, but like 10% of the time it goes this other way, you know. Um, well, Garrett, again, thank you so much for agreeing to come on, um, to the podcast and talk about this whole process. It’s been a long, you know, time in, in making this story, but I’m really, really glad to hear this, uh, not a final outcome, but this point in the process and how, how things have been for you and your peers. So thank you so much for your work and for sharing it with my audience.

Garrett (39:03): Yeah, it was a pleasure and thank you so much for having me. Um, I’m just hoping we can make, uh, the graduate student experience better for everyone.

Outtro

Emily (39:21): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by me and show notes creation by Dr. Jill Hoffman.

This PhD Promotes DEI with a Focus on Finances

July 1, 2024 by Jill Hoffman

In this episode, Emily interviews Dr. Carolina Mendoza Cavazos, who holds a PhD in microbiology from the University of Wisconsin-Madison and currently works in industry. Carolina has long been interested in and open about personal finances, and she focused her DEI efforts while in graduate school around finances, including starting a money club and creating clear communications regarding pay and benefits. Carolina shares her insights into the kinds of financial issues graduate students face and how universities should back up their recruitment of diverse candidates with sufficient financial support and communication. Finally, Carolina and Emily discuss the financial goals and lifestyle upgrades Carolina has enjoyed since starting her job in industry.

Links mentioned in the Episode

  • Dr. Carolina Mendoza Cavazos’ Website: Finances with Carolina  
  • Dr. Carolina Mendoza Cavazos’ Twitter 
  • PF for PhDs Excel Spending Tracker
  • Host a PF for PhDs Seminar at Your Institution
  • Emily’s E-mail Address
  • PF for PhDs Subscribe to Mailing List 
  • PF for PhDs Podcast Hub 
PhD Promotes Diversity, Equity, and Inclusion with a Focus on Finances

Teaser

Carolina (00:00): Basically like who, who can afford to go to graduate school and how the people that have made it to graduate school, how can we support them during? There’s a lot of focus on the DEI efforts within recruiting. I also think that if there is not a support system for the students that are coming in and staying, I think that is a disservice to the minorities that you recruited. While it’s really great to get a fellowship, if the school can get to brag about the funding that you have, the schools should also support you through the issues that may arise due to that funding.

Introduction

Emily (00:55): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (01:24): This is Season 18, Episode 3, and today my guest is Dr. Carolina Mendoza Cavazos, who holds a PhD in microbiology from the University of Wisconsin-Madison and currently works in industry. Carolina has long been interested in and open about personal finances, and she focused her DEI efforts while in graduate school around finances, including starting a money club and creating clear communications regarding pay and benefits. Carolina shares her insights into the kinds of financial issues graduate students face and how universities should back up their recruitment of diverse candidates with sufficient financial support and communication. Finally, Carolina and I discuss the financial goals and lifestyle upgrades she has enjoyed since starting her job in industry.

Emily (02:10): When I teach budgeting, I emphasize that it actually consists of two components, budgeting aka telling your money what to do and tracking aka checking that your money did what you told it to do. While I love and use automated tracking software, in my opinion nothing beats manual tracking, which naturally keeps you accountable to yourself for your spending. In fact, last year I made a custom expense tracking spreadsheet for my own use. If you would like to try out manual expense tracking, feel free to take my spreadsheet and use it as is or build it out however you like. I built in a couple of budgeting principles that I like to follow and teach to PhDs. There’s a companion video available explaining those principles. If you’d like to grab the spreadsheet, it’s totally free, simply sign up through PFforPhDs.com/tracker/. You can find the show notes for this episode at PFforPhDs.com/s18e3/. Without further ado, here’s my interview with Dr. Carolina Mendoza Cavazos of Finances with Carolina.

Will You Please Introduce Yourself Further?

Emily (03:29): I am delighted to have joining me on the podcast today Dr. Carolina Mendoza Cavazos. She is a scientist working in the private sector. She finished her PhD about two years ago, and like me, Carolina is also really, really into personal finance and also she has a special focus on DEI, efforts related to personal finance. And Carolina has a website called FinancesWithCarolina.com, and I first came across her, it must have been several years ago on Twitter, and I’ve been keeping my eye on her for a while. We finally had reason to connect recently and set up this podcast interview, which I’m really excited about. So Carolina, would you please go ahead and introduce yourself further for the audience?

Carolina (04:04): Sure thing, Emily. Hi everyone, my name is Carolina and I obtained my PhD at the University of Wisconsin Madison. I’m currently a scientist in the r and d department at Promega, and um, I’m very excited to be here today.

Finances During Childhood, College, and Beyond

Emily (04:21): Yeah, let’s go back, um, even further because I want to hear about, uh, your background, especially with respect to finances starting kind of in your childhood. You can give us a brief overview of how things were, um, financially growing up and then through college and graduate school and I’m, I’m interested both in kind of materially what was going on and also how that affected your mindset through that period.

Carolina (04:41): My family and I moved to United States in 2011 and I finished my senior year of high school, then applied to college and I obtained my undergrad at California State University Fullerton. My dad is an accountant, so he talked about money quite often. I would say that being an immigrant, we did have certain like mindset that came with that and frugality was a really important one. I would say that from the both sides of my family, either one or two generations broke the cycle of poverty and I grew up in a family with two college educated parents and we were able to migrate here to the United States, um, due to a job opportunity for my mom. So that was kinda um, how we got here. I would say I was always interested in finances in general in college. The first time I got a paycheck was through a program called MARC Maximizing Access to Career Research and is a pipeline for like graduate school program. So that’s kind of where my budgeting journey started. I lived at home, uh, during college and receiving that paycheck was the first time that I was, you know, making all my budgeting spreadsheets and stuff like that.

Emily (05:58): Yeah. So let’s kind of turn to graduate school now. It actually seems like you were set up pretty well to understand maybe the finance of graduate school having been in that program, the MARC program during undergrad. Um, so tell us about like that transition and maybe the kinds of offers you got and whether you considered, you know, finances. It sounds like you probably would in your selection of which university to attend.

Carolina (06:17): I don’t think I looked at the stipend as carefully as I would today. I gravitated towards the Midwest because the Midwest had awesome microbiology and I knew I was gonna end up somewhere in the Midwest. Um, my last two top school choices, like were between UW Madison where I ended up attending and um, Wash U. So those were my two offers. And in general, stipend wise, they were pretty similar. However, UW Madison had a program similar to MARC called SciMed, shout out to SciMed, it’s called Science and Science and Medicine Scholars. And basically it was a community that I could plug into that I did not see at any other universities and I felt that that was, uh, a good fit for me. So that’s kind of why I decided to go to UW Madison.

Emily (07:16): So tell us a little bit more about how finances were going for you during graduate school. You said that you had, you know, uh, a frugal and a debt averse kind of background with your family. Um, you’re in the Midwest. Yeah. Was the stipend livable? Were you able to save? How are things going for you personally?

Carolina (07:33): Yeah, in terms of finances, I did move here to Madison with a partner at the time, now my husband and we, that’s kind of when we started not fully merging our finances, but we’re definitely operating as a household at the moment and basically we were like kind of equally splitting everything. So that was definitely helpful and I would say that the stipend was livable, however, having a partner was definitely helpful. And one interesting thing is that I was funded the whole time during graduate school, so the five years I had different grants, fellowships, things like that. So I was fortunate that I didn’t have to pay segregated fees or like the student fees for that. Um, I ended up working as an hourly for assignment and that was, um, a workaround in order to get retirement benefits like a 403B or something like that.

Carolina (08:35): I definitely think that my husband and I had like different mindsets about finances and it was interesting to kind of get into that. But I would say in graduate school I found your podcast through Hello PhD and I think the, the thing that really caught my attention was the use of, um, buckets for like high yield savings accounts. So I think that that was like one of the first things that I did in order to get the same service but like in a cheaper way. Like for example, like car insurance, I faced a lot of issues with funding transitions that ended up being, in my opinion, DEI issues in terms that I don’t know, I, I saw a lot of the times like the same pe- people in the program doing the same jobs and being funded differently would still face different issues. And in terms for advanced opportunity fellowships like for, um, minorities like me and things like that, I would say like that was like a double whammy of you might have a surprise tax bill and things like that. And like how, how do you deal with that? Do you, do you have your emergency fund set up? Do you rely on a network? Is there network that you can rely? Do you incur debt? And things like that. Issues that I encounter with my funding, I always wonder and through the grapevine have heard that other people that were funded had this issues. So I think that that was my first step to get into using personal finance and deed efforts during graduate school.

Financial Challenges During Grad School

Emily (10:15): Hmm. Yeah, I definitely wanna hear about more about that in a minute. Um, can you expand at all on the, the issues you were just talking about with like the funding? So like quarterly estimated tax bills. We talk about that a lot in the podcast, hopefully the listeners familiar with that. Um, anything else? Like, just tell me what, what the issues were that you either experienced or that you observed.

Carolina (10:35): Yes, so one of the issues right off the bat was taxes obviously. And um, I definitely had a tax bill that I wasn’t expecting and I wasn’t aware of the fellowship, um, quarterly estimated taxes on my first year or something like that, the Kiddie tax. Why not? One of the things that I would say is that access to benefits was a little different. So for example, there was no, someone in my lab and me, the other peop- the other person could contribute to an FSA account or they would be able to and eligible to open a 403B. Um, what else? Gaps in insurance or, um, what are they called? Potential gaps in insurance. For example, some of my friends that were in the NSF were getting COBRA letters when they were having their funding transitions because you might have lost insurance and they were not aware of this and it was just because some paperwork was delayed and things like that.

Carolina (11:46): Personally, I did a, an internship during my fourth year summer, somewhere between fourth and fifth, and I had to take a short leave of absence for that. I had to prepay my insurance and there was a lot of issues with that. Um, I, I think I was the first one to do this and the program that was receiving a stipend that, that was receiving a stipend and had to pause that in order to go into the private sector and get, um, private sector money. Usually if you were in your, I don’t know, a W2 route, I don’t know how they would have handled it, but there was miscommunication on that. Uh, one point I wasn’t sure if I was gonna have insurance over the summer and access to healthcare is definitely something that everybody should have. And, um, I had some health issues during graduate school, so that was a very scary time for me.

Carolina (12:45): And through the grapevine again when that happened, I started documenting if other people have faced this within the, the fellowships during, within the T32s and stuff like that. So when I was working as an hourly for assignment, some of my job was to write down what should you do if you are going to into a internship, what are the, um, I also implemented, I was part of the DEI committee in my program and I also proposed and implemented a funding transition form to pinpoint where is your money coming from in this semester? Where is your money gonna come from next time? Do these people know each other? Should we introduce everybody? Do they know that you’re coming or that you’re leaving the, the fellowship training grant, et cetera. And I found a lot of people that were having trouble with this things and it wasn’t just me. So I think that there is, there, there is a very powerful thing in community and I was trying to find the people that were having these issues and try to play safety nets for when people did face them because they’re bound to happen sometimes. They knew what to do, who to contact and things like that.

Emily (14:10): So helpful. I mean, it’s amazing that you, you know, worked along with your peers to put that resource together, um, through SciMed. It sounds like it was kind of part of your job, but to the extent, yes, you were doing it and it wasn’t part of your job, uh, amazing community service, but probably should have been taken up by the university. Um, obviously they’re the ones providing these benefits or facilitating the benefits, so like, yeah, they should be taking charge and making sure the transitions are seamless. I think about some this sometimes with respect to the tax questions of, you know, calculating, filing quarterly estimated tax or dealing with stuff during tax season. Um, like I know it’s really normal in the US for your employer to be very hands off about taxes. Like yeah, we’ll do withholding, that’s it, that’s the extent of what we’ll handle. But like universities aren’t even doing that much in most cases for fellowship recipients. And I do think they should be a little bit more proactive and, and thank you so much to the ones that work with me and are proactive about this, but be proactive about at least communicating right when the students, um, about what’s gonna happen. And it sounds like not, not only in the tax realm, but it extends with all these other benefits like you were just talking about. So I’m really glad you kind of gave us that overview. Um, so it sounds like you were working with, you know, SciMed and also talking with your peers. Can you tell me a little bit more about kind of what you learned or observed about how your peers were handling this stuff financially? Not just with, with respect to the benefits issues that we just spoke about, but maybe more generally what they needed to know or what they needed to apply, um, in their personal finances during graduate school?

The Birth of the Money Club

Carolina (15:36): Yeah, I, I think a lot of my peers were either, I don’t know, like I would say like there was like two categories. People that were in the category of like, you know what, I don’t wanna think about it. I am, I’m gonna take a pause on this while I’m in graduate school and once I figure out what my career path is gonna be, I’m gonna pick it up. And there was a small subset, small but mighty that was interested on talking about this and was sort of like, I think the taxes are the foot in the door for everybody that they’re just want to learn a little bit more of how to handle those. But once they’re in and then you just start chatting and like, where do you put your tax money before the thing is due? How are you, um, self withholding and things like that. I think that was kind of like the natural birth of the, the, the money club that we developed. And I really can’t remember if that was part of the SciMed job or eventually we kind intertwined it or something like that. The SciMed job was basically really help your community, how can you do this? Obviously there was like events and food ordering or flyer making and stuff like that, but I, at one point I was trying to explore student services as a career, so I think that that was my in, um, with that position. And then it turned into a way for me to look at this DEI issues and try to create resources for the people that were within the fellowship where in the fellowship were gonna come into the fellowship and things like that.

Emily (17:22): I totally agree with you that the taxes are the way to most, uh, you know, getting most people’s attention into personal finances. Yeah. Uh, where did it go after that? You know, you already mentioned using targeted savings or sinking funds as a helpful sort of addendum to your budgeting. Did you all talk about that or what other topics did ended up being of interest to this group?

Carolina (17:42): One of the topics definitely people were interested in investing. I think that that was one of the other ones that we’re kind of popular and, um, I don’t know, mystified a little bit and people wanted to ask around. I think, I think the money club really started getting around going like in 2021 after the summer of 2020, um, when George Floyd was murdered the entire a a group in the program started writing a letter to our admins and our professors and things like that in which we were quote unquote demanding changes in our program and whatever. So I was involved in that effort and I do remember putting some personal finance stuff in there and, um, I think when the whole program read it and they knew that there was like some of the things that I was requesting, like for example, um, I had recommended you to, to our program. I don’t know if they ended up hiring you or not. Basically like in the program then I, I became known as the person that talked about money and then people that wanted to talk about money found me. And, um, the other topics that I would say not so much as investing, but I kinda wrapped it around with investing was retirement and some of the benefits that the university was offering for students that did have access to those. The majority of my program was not like brought partners or anything like that. I, I don’t remember, but sometimes there was students that had in their budget a, a way to invest and they just wanted to start.

Emily (19:22): Absolutely. For me, I always say taxes and investing are my two favorite topics to discuss. And it’s lucky because those are the two top, um, most popular topics that get requested, which is really fun for me. Um, it’s so interesting too being in an environment where some people have access to that 403B, um, and even the other, well you mentioned FSA not an HSA, um, through the university, but perhaps other benefits that’d be relevant, you know, for investing. Um, and obviously if you’re on fellowship or, and if you’re not an employee, you’re not gonna have access to that, but it sounds like a subset of people would, and you and you also had access to <crosstalk>.

Carolina (19:55): So I found a loophole

Emily (19:57): Yeah. To be, um, a proper W2 employee at least for a few hours enough to give you that benefit.

Carolina (20:03): And I made it automatic that all a hundred percent of my hours with SciMed would go to the 403B.

Emily (20:10): Well, that’s kind of cool that they let you do that. I know sometimes employers that have like a restriction like no more than 50% of your paycheck or 25 or something, but obviously since it was just part-time for you, if that makes sense. Um, yeah. Anything else you wanna tell us about the money club?

Carolina (20:25): I think people just need safe spaces to talk about money, and I think it’s one of the cases that if you create it, people will come. I, I personally feel that a lot of people wanted to start working on their finances and they just didn’t have the language, the space, sometimes the resources or like the, the uh, uh, closed mindset of, well, I’m not making enough money so I, how can I work on this? And I think that’s my main, one of the things that I try to help people with is that your personal finance, like, and starting to work in your personal finance, it doesn’t have to be this ginormous thing that you have to put thousands of dollars into it. I think it’s small actions that just kind of add up and, um, my whole spiel is that I, I would like to create systems that you later edit when you get a different job and there’s a lot of things that you can do in order to work in your personal finance that don’t cost money or they can be a $2 thing and, and it’s more of like flexing that muscle as a lot of people say in the community. I think it’s true.

Emily (21:51): I totally agree. Um, and I, going back to kind of what you said earlier about, you know, the, you sort of encounter two kinds of people, like some people who wanted to engage, but some people just wanna say, you know, I’m not making that much money, it’s not the right time to be working my finances. I will pick this up later. And they are overlooking that benefit of, as you said, flexing the muscle of learning a few skills, of getting a little bit of extra knowledge, um, whether that can be applied during grad school or whether it’s just gonna be something that’s practiced a bit or set aside for later. Um, all of that does help you set up for financial success in your next post PhD career when you have that higher salary coming in. And of course it will be easier in some sense when you have, when you’re making more money, but if you’ve never practiced budgeting, if you’ve never really thought about what’s important to you in your spending, if you’ve never opened an IRA before, well that’s stuff you’re gonna have to learn, um, when the stakes are a little bit higher later on. So of course you know that I’m a proponent of working on that stuff during graduate school, you know, if at all possible, and as you said, it doesn’t have to, you don’t have to be able to save necessarily to have a savings rate to do positive things, um, in your personal finance, there’s lots of cost neutral things that you could do. Um, and hopefully you can get to a point where you’re able to save.

Commercial

Emily (23:05): Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, frugality, increasing income, or student loans, each tailored specifically for graduate students and postdocs? I offer seminars and workshops on these topics and more in a variety of formats, and I’m now booking for the 2024-2025 academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, or postdoc office? My seminars are usually slated as professional development or personal wellness. Orientations or very close to the start of the academic year would be a perfect time for tax education or general personal finance content. Ask the potential host to go to PFforPhDs.com/financial-education/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

DEI and Personal Finance

Emily (24:32): I wanna get back to this point about how you, um, use the topic of personal finance within your own DEI efforts. And it’s something you’ve mentioned a few different aspects of it until now, but I just wanted you to just make it really explicit, like how do you view this and how do you work in this area?

Carolina (24:47): So I think DEI efforts are sometimes in some spaces, and this is not particularly about my university or my program or anything like that, but they get a little bit performative and they can get into, uh, check a box. We have a DEI committee and that’s it. That’s it. So I was involved in the DEI committee since this founding at, um, my program after the letter that I mentioned that we wrote. So through that there was two representatives for the students in this committee and we’ll bring issues forward regarding whatever our, our peers had brought up. And a lot of those ones sometimes were personal finance related, for example, there was one time that our paycheck schedule changed from a monthly to a biweekly time and a lot of the students were like, how am I gonna make rent if the biweekly paycheck is happening and then that I’m receiving that in this amount of time. I don’t have a safety net to just make that payment at the beginning of the, of the month if this happens. Um, so trying to make explicit what type of resources are available in the university for, uh, emergency hardship and stuff like that. That was one thing I definitely always advocated for more clarity on funding transitions as well as the fellowship letter. For example, I know that that one or my specific university came in March while your W2 came in January. So we had a case in which a student basically submitted their tax return after they got a W2 and they then they got the fellowship letter and they had to amend it. So basically being more transparent and proactive about the types of issues that funded students might face having I, I know one of my, um, one of the other representatives really advocated for having the, the number of the stipend for our incoming students instead of just kind being this nebulous number that you kind of hear there when you’re already in the interview.

Carolina (27:24): During the time that I was there, another person, not myself, but they got my full support, was really trying to start the conversation of a livable wage. So what is that? Like, how do we compare to other programs? And um, she did a tremendous effort, um, in order to look at the cost of living and how is that going and how, you know, it might not be our stipend might not be keeping up with this, what are we gonna do about that? So I would say that I definitely advocated for transparency in my, um, dei position from the program for the university. And I basically started spreading the information and just kinda reporting back to the committee and say like, this is what I did and I had my, my PI’s full support. I was very fortunate that she had my back. And um, there was instances in which I think if my PI was not supportive, like maybe they could have been like some issues and um, in terms of just like, hey, I think that what we’re doing is wrong, not wrong, but like not having the stipend number really there.

Emily (28:46): Yeah. Sort of obfuscating. Yeah.

Carolina (28:49): Yeah, I didn’t like that as much. My main issue was the medical coverage and I, I did as much as I could in order to create as much documentation and as much process safety nets for people to not receive that letter, um, of the COBRA Fellowship, um, not have to pay out of pocket for necessary prescriptions. If you have a lacking coverage, you cannot even make an a, a doctor’s appointment. It’s not like you can make it for later when you have coverage, they’re just not gonna talk to you. I had a back injury during graduate school and um, other chronic conditions that access to healthcare was, is necessary for everyone, but for me was particularly scary not to, and just the threat of not having it, it’s sometimes it was just that the, some deadline was occurring and like you’d really never had a lack of care. But just having that big thing in your brain that you might not have it, I think you, that takes you away from science and then you’re worrying about that instead of your experiment.

Emily (30:04): That’s exactly what I was thinking when you were going through, um, that response is that if we want to keep graduate students and postdocs, um, focused on their research, focused on progressing in their programs, successful in their academics, academia has to materially support them properly so they aren’t one distracted by the things like the benefit issues and all the, all the one things that we’ve talked about so far. Um, but then also by financial stress overall, um, having to be super, super frugal or having to make very extreme sacrifices in what your expenses are. Or on the flip side, you know, maybe spending a lot of time side hustling because your stipend is just not sufficient. And as a DEI issue, I mean if we want <laugh> more diversity in academia, um, and more people being successful across the board, we have to support them in a way that we’re assuming that they’re not gonna have to depend on family members or partners or other people who might or might not be able to contribute financially to them. Um, and frankly, a lot of people, you know, now have caregiving responsibilities. They have to contribute to the finances, other families too. And so again, you can’t even assume it’s just like a single person and all we have to do is provide for your basic living expenses and that should be enough for you because even these small bumps in the road, like you’ve been talking about these small emergencies or something medical comes up or I have to take an unexpected flight, these irregular expenses that you mentioned earlier, um, that can completely throw off your budget if you’re living with very little margin very close to the edge in the first place. So the way that I see it, we just have to fund graduate students, um, more than the baseline, right? Like not even the living wage. We gotta go beyond the living wage because you, to really be financially secure, you have to have a savings rate because these things will ease emergencies, these things will come up and it’s so much easier to recover from them and get back to being focused on your program and on your work, um, when you have the finances there and you don’t have to scramble and be stressed about it. So <laugh> that’s my part of the soapbox there. Um, yeah, anything more that you’d like to say about your, like the way that you do these DEI efforts?

Carolina (32:13): What, what I, I currently try to do and what I tried to do during graduate school was really providing the information that some people might not have. Basically like who, who can afford to go to graduate school and how the people that have made it to graduate school, how can we support them during, I believe that there are, there’s a lot of focus on the DEI efforts within recruiting and being like, yes, come to our university and having admissions numbers. And I think that that is very important. I also think that if there is not a support system for the students that are coming in and staying, I think that is a disservice to the minorities that you recruited. So while it’s really great to get a fellowship and it’s really good to be a funded student and that opens the doors for you to go into a lab that you might not have access before or gives you more research freedom and things like that, I think that if, if the school can get to brag about the funding that you have, the schools should also support you through the issues that may arise due to that funding.

Emily (33:48): Very good point. Thank you so much for adding that. Let’s turn our attention back to you in your post PhD life with your proper job, with your proper, uh, salary, which sounds amazing. So how are you pursuing financial goals these days and how are you doing with your, um, spending and just like, what’s going on in your finances now?

Post-PhD Finances

Carolina (34:08): Well, the private industry pays very well and as we know, our equation for our budgeting income is one of the biggest, um, in there. So I would say that for the first six months that I was at my full-time employment, I didn’t give myself a raise and I threw everything into retirement. So I think I started in the end of August, so I tried to get as close as the max as I could for the employee sponsored 401k and um, that, that was really great because, um, we were used to living in a given stipend and we didn’t really change much during those six months. Then after that I would say that my husband and I made a list of things that we wanted to upgrade in our house and one of them was a new bed <laugh>, one of them was a new fridge and, you know, things that we were like, it’s large expenses and is, I don’t know, it just felt like it was definitely a, a pivotal moment in an income that we could just buy this and not really like budget for it or something like that. And I, I think we bought the fridge for like a bonus or something <laugh> my sign up bonus or something like that. And I would say right now, because in graduate school I faced some medical issues, I would say that I really became a quote unquote vaulist that I was really trying to find what adds value to my life and the things that I really care about. And I think when people get sick or something like that, they really turn inward and, and start thinking of like, what is important in life. And I really started seeing like, okay, what in my budget reflects my values? What doesn’t and how can we reconcile those? So for example, family is very important to me and my husband, so I am happy that travel is a big category in my budget and we, we ran the numbers for the last year and I think like that was like our third category that we spend money on because our families are not here, so we have to travel to see them and we are pursuing fire. I think right now we don’t have responsibilities that are really sinking funds at the moment. So, um, I think I’m, we’re just kinda understanding what this new income can do and where can we put it into the long term retirement plans. And I’m also focusing on trying to live the life that I, I want. And I feel like during graduate school sometimes people really throw themselves into work and they’re like, they’re passionate about their stuff and they kind of like sometimes like don’t have like outside things. I definitely was guilty of that. So I’m trying to course correct and really focus on things that bring me joy in my every day today and spend on those ones I wouldn’t say previously, but definitely spend on, on the things that bring me joy and the things that I don’t care about, like my cell phone plan to definitely cut it as much as I can.

Emily (38:00): I just hope that, um, the listeners who are still in graduate school and are looking forward to the transition that you, um, have com- have, um, completed, can remember this example when they’re in your shoes because in, in my view, you have executed this like just perfectly <laugh>, um, which is kind of a combination of live like a grad student, like okay, don’t make any major changes right away. You, it sounds like you didn’t have to move or anything. So like there was some stability and it was, uh, easier in a sense to continue on with your previous level of spending, but in combination with that sort of as a default, okay, we’re not gonna, we’re gonna default to not changing anything, but then as you said, be so intentional about thinking through where you do want to spend more or where you wanna save more, um, to reach your financial goals and your lifestyle goals and everything and just add money to those buckets and to those places, um, and really get, as you said, like introspective about what’s important to you and apply that to your budget and reconcile them as best you can. Um, I just think it’s a wonderful, wonderful example, especially for someone who, who doesn’t right immediately after graduate school because the moving process brings in like more variables and more opportunities for like chaos in your budget when you have those kinds of transitions. That was the one that I went through personally. But yeah, I just think it’s so wonderful and awesome job. Of course, given the background that we heard, we knew that you were gonna do an awesome job with this, but it’s just amazing to like hear some more details about that.

Financial Mindsets, Skills, and Habits That Help With Post-PhD Life

Emily (39:22): Were there any skills or mindsets that you developed during graduate school with respect to your finances that you found useful in this post PhD, uh, life that you haven’t already brought up?

Carolina (39:34): I think making things automatic was something that I am still doing and I’m glad that I started before and I think like going back to the beginning about the savings accounts and we, we had a lot of transactions being automatic and right now I feel like we’re just kind of coasting. Like it, it’s something that we, we have developed already and I think that I’m never gonna pay my car insurance by month. I think that that is something that, um, I started doing in grad school because it was cheaper and now we, we just kind of continue with that. I think the frugal mindset of, of graduate students and like finding fun things to do for free, that is something that I have continued. Just yesterday I went to the library because they had a craft cafe and I made a craft and I had a blast and, and it cost $0. So I, I think a graduate student is good at finding those things around and taking the opportunity to, you know, have fun with a free activity when you, when your stipend is not as large, you sometimes like you really try to find the things that you care about and spend money on those. Like for example, I have a friend that he was willing to bike in and he bought a rather expensive bike, but it brought him a lot of joy and that was something that he did during graduate school and biking was his like stress reliever. So that was very worth it for him. And I think finding the things that are worth it for you, I think graduate school is a great time because you are sort of like tied on the money side and then sort of like continue those things and cut merci- mercifully, um, in the rest.

Finances with Carolina

Emily (41:37): Mm-Hmm <affirmative>, that’s Ramit Sethi <laugh>. I know that quote. Yeah. Um, well it was so great. It was so wonderful talking with you Carolina. Can you tell the listeners more about Finances with Carolina and what you do through your business?

Carolina (41:48): Sure. This business started out of the money club and I, I wanted to have a space in which I can help graduate students that are facing similar challenges to the ones that I faced or that my peers faced. And I would say that right now I do a lot of coaching calls in which students fill out a questionnaire that I have for them and that covers things, uh, as I mentioned, what brings you joy in your life and uh, I’m not gonna ask them to cut in their budget if that thing brings them joy <laugh> and, um, we go all over debt repayment and, um, trying to set up those high yield savings account, what are irregular expenses that they are gonna face. Retirement a lot of people are interested in that. And I would say personally from my community, I think finding someone that went through graduate school is just helpful that they can relate to you. I think that that is something that you and I bring to our communities that we, we know what it was like and we know what the problems might have been and, and heard about certain solutions or know someone that might have gone into that. So I would say the network that we, that I developed during graduate school, I have been using that for my clients as well. If someone is, and, and right now I would say coaching like just once on ones are my main focus and the way that I try to get funded is basically making the program, uh, cover those so the grad student doesn’t have to pay. Yeah, anything from budgeting to debt repayment. And I really like the one-on-one conversation. I I don’t think that’s scalable, but uh, I’m having a lot of fun with that. So, and I do like having an impact on someone’s life directly. So I think that’s why I am, I’m keeping it on the one-on-ones at the moment and I do have one digital product in which I have put like just kind of like stuff together in which, what the most common questions are and things like that. And I understand that not everybody likes the, the chatty, um, the chattiness that comes with like one-on-one coaching. So that’s, um, why I developed that one. In the future I hope to develop one that is not focused on graduate students and just in general because now I have been finding at work that some people that I did not find them in graduate school and they’re now starting their careers and they’re in their first full-time job with benefits and things like that, they’re a little bit lost. So that is another digital product that I wanna develop but is not ready yet. <laugh>.

Emily (44:38): Yeah, sounds like you’re repeating, repeating what you did during graduate school. You’re, you’re just a person that is open about money that people can feel comfortable talking to you and you find other people who are interested and you find other people who need your help at every single stage. So that’s just wonderful. And tell the listeners where they can find you.

Carolina (44:55): Yes, listeners can find me at financeswithcarolina.com and in there there’s uh, there’s a link to the digital product that I talked about. Um, there’s a link to the coaching services and things like that. So if you find me relatable and you wanna chat about money, schedule something <laugh>.

Best Financial Advice for Another Early-Career PhD

Emily (45:16): Beautiful. Okay, let’s finish up with the last question that I ask of all my guests, which is, what is your best financial advice for another early career PhD? And that could be something that we’ve already touched on in the interview or it could be something completely new.

Carolina (45:29): My best financial advice. The, it’s, it’s a marathon, not a sprint. And I think that if you start flexing the muscle of working on your personal finances with small changes that are sustainable in realistic for you, you’re more likely to stick to those goals. I would also say that in order to keep that momentum going and that inspiration that you sometimes need on, on personal finance, I really would like to encourage the listeners to find content creators that speak with relative, like speak to you in experiences that you relate to in experiences that you might have aspirational in things. And, and overall really find the content that is gonna keep you motivated. And the content is the same, it’s just the delivery, it’s the, the, the experiences that the people that are delivering the content, the network of those people. So overall, find someone that does inspire you and keep you motivated and slow and steady.

Emily (46:46): All right. Name your top few content creators that you love to follow for, for yourself personally.

Carolina (46:52): Yes. Um, well of course your podcast. I think that was one of the ones that Hello PhD. You you did a cross interview with them and that’s how I find you and I was just mesmerized of all the things that I could do with my stipend <laugh>. Um, so that’s one definitely related to graduate school in terms of minorities, I I really like the podcast Brown ambition. There’s two ladies in there and they have everything about career questions, entrepreneurship, money stuff and how that relates to one another. They’re in different stages of their careers and lives and just very interesting to see where they’re coming from and where they’re going. Uh, popcorn Finance is another one that is very nice and um, it has a lot of investing. I love their investing series. I referred everyone to that one because they have a lot of content of like, what is an ETF, what is an index fund, what is a lot of what is and and when you start reading all these things,

Emily (48:01): I didn’t know about that series. I’m gonna check that out.

Carolina (48:03): It’s really good. Um, journey to Launch is another one, that I follow, she definitely has like really cool interviews and just a lot of inspirational stories. Afford anything by Paula Pant. Yeah, those, those ones are the ones that like I probably listen like yesterday or today.

Emily (48:27): Yeah, every single one of those podcasts is also on my feed except for Popcorn Finance. I’ve only listened on and off to Popcorn Finance, but the rest of ’em, I’m a regular listener. I love all of them, especially, um, Afford Anything is like taking the podcast medium to like the next level with like journalism, um, around finances, which is so amazing. Paula Pant doing an amazing job. Um, okay. Well Carolina, thank you so much for giving this interview. It’s been really insightful and it’s been lovely talking with you. Um, thank you so much for agreeing to come on.

Carolina (48:55): Of course.

Outtro

Emily (49:06): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by Dr. Lourdes Bobbio and show notes creation by Dr. Jill Hoffman.

Addressing Fellowship Tax Pain Points through Education, Resources, and Advocacy

April 1, 2024 by Jill Hoffman 1 Comment

In this episode, Emily interviews Jack Mao, the founder of Tax Fellows, a nonprofit organization that prepares pro bono tax returns for Stanford students. Tax Fellows primarily serves first-generation, low-income undergraduate and graduate students, and has a special focus on the tax implications of receiving scholarships and fellowships, such as the Kiddie Tax and estimated tax payments. Jack shares the advocacy approach he’s taking to reform the Kiddie Tax at the federal level and lists ideas for how graduate students across the US can bring more attention and resources to resolve their tax pain points.

Links mentioned in the Episode

  • PF for PhDs Tax Workshops (Individual Purchase)
  • PF for PhDs Tax Workshops (Sponsored) 
  • Emily’s E-mail Address
  • IRS Volunteer Income Tax Assistance (VITA) Program
  • Jack Mao’s TaxFellows Program
  • PF for PhDs Tax Center for PhDs-in-Training 
  • PF for PhDs Subscribe to Mailing List
  • PF for PhDs Podcast Hub
Addressing Fellowship Tax Pain Points through Education, Resources, and Advocacy

Teaser

Jack (00:00): Where students aren’t being told to expect significant tax liability on their stipend checks and like making sure that they save money for taxes. There’s no, you know, mechanisms like withholdings where the schools will pay the taxes on the students’ behalf. And so the students just kinda have to like figure it out and learn the hard way during their first tax season. And I feel like, you know, that’s not really the way to go. That there definitely needs to be a lot more resources across all the universities in the country to really help educate these students on their tax liability and really help support them through it as well.

Introduction

Emily (00:54): Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs.

Emily (01:24): This is Season 17, Episode 7, and today my guest is Jack Mao, the founder of Tax Fellows, a nonprofit organization that prepares pro bono tax returns for Stanford students. Tax Fellows primarily serves first-generation, low-income undergraduate and graduate students, and has a special focus on the tax implications of receiving scholarships and fellowships, such as the Kiddie Tax and estimated tax payments. Jack shares the advocacy approach he’s taking to reform the Kiddie Tax at the federal level and lists ideas for how graduate students across the US can bring more attention and resources to resolve their tax pain points.

Emily (02:04): The tax year 2023 version of my tax return preparation workshop, How to Complete Your PhD Trainee Tax Return (and Understand It, Too!), is now available! This pre-recorded educational workshop explains how to identify, calculate, and report your higher education-related income and expenses on your federal tax return. You’ll hear me reference this workshop once or twice during the interview. Whether you are a graduate student, postdoc, or postbac, domestic or international, there is a version of this workshop designed just for you. Go to PFforPhDs.com/taxreturnworkshop/ to read more details and purchase the workshop. By the way, it’s never too early to start laying the groundwork for university sponsorship. If taxes are a pain point for you, please let the administration at your university know that you would like them to provide additional resources either during next tax season or near the beginning of the academic year, as Jack suggests near the end of the interview. I can license one or both of my asynchronous workshops or deliver a live seminar. Please cc me ([email protected]) if you decide to recommend me! You can find the show notes for this episode at PFforPhDs.com/s17e7/. Without further ado, here’s my interview with Jack Mao of Tax Fellows.

Will You Please Introduce Yourself Further?

Emily (03:40): I have a really special guest joining me on the podcast today. His name is Jack Mao and I’m going to let him introduce himself to you further in just a second. I just wanna say how we got connected, which is that I have been working with Stanford this past tax season to provide my tax workshop to their graduate students and postdocs, and Jack started an organization at Stanford called Tax Fellows. The more serves on the undergraduate side, but definitely some overlapping, um, interests in populations between our two. And so because of our mutual collaborators at Stanford, we got to talking and just had an absolutely fascinating conversation and I knew that I had to bring him onto the podcast. So Jack, we’re gonna get into your whole background, but just really briefly, can you tell us who you are and what you’re up to right now?

Jack (04:23): Sure. Uh, thank you so much for having me on the podcast here, Emily. Um, my name’s Jack. I am, I was a Stanford student, uh, until recently. And, um, I’ve been also a credentialed tax professional, uh, federally credentialed for the past, uh, couple years, but in the industry for about six years so far. Um, and yeah, it serves a lot of, um, you know, college students, that’s kind of my strong suits and so it was natural for me to just kind of start Tax Fellows, uh, in partnership with the IRS and few Stanford offices to help out other college students with their taxes.

Emily (04:58): Yeah, and this is a really unique organization. I haven’t found one like it at any other universities I’ve collaborated with. So I wanna hear more about that. But first I wanna get a little more background on you, Jack, and sort of how as an undergraduate student you became interested in income tax and ultimately, you know, that led you to starting Tax Fellows.

Jack (05:16): Sure, sure. So, um, my background is actually in computer science and so totally different than, you know, tax, um, and accounting. But, um, it was back in high school I was, um, so I come from a low-income background and I was trying to start a small business to help out with family finances. Um, and at the time I just had, you know, my McDonald’s paychecks to pay for everything, which wasn’t really enough to, you know, pay for, uh, you know, accountants or, uh, lawyer’s advice. So what I did was, yeah, it’s a good CS major or do just Google everything. Uh, would not recommend unless you plan on switching ma- uh, you know, majors in industries, um, or careers. But, um, yeah, um, Google, everything. Really loved. Uh, just the way the taxes works, you know, I hate paying taxes, but it’s just, you know, it allows you to have a lot of creativity and flexibility and kind of, uh, finding ways to get around taxes you don’t really want to pay, uh, at times. Uh, and so that was really fun. I really want, uh, go more into it and to decide to volunteer with the IRAs VITA program, um, that works with nonprofits, uh, to provide free tax services to income taxpayers. So been, uh, in that program ever since, uh, and still am in that program, uh, through Tax Fellows today.

Volunteer Income Tax Assistance (VITA) Program & TaxFellows

Emily (06:37): So can you explain a little bit more what the connection is between the VITA Program and Tax Fellows? Is it exactly the same? Is there, is there more to it?

Jack (06:45): Sure. So, um, originally we started out just as a VITA site. And so Tax Fellows is a 501(c)(3) nonprofit, it’s a standalone nonprofit, um, that’s separate from Stanford, but we partner with the IRS, where the IRS helps us provide some training, some overhead and, you know, oversight, um, and helps us source a lot of our volunteers as well. Um, but now, now that Tax Fellows, um, has finished their first year and joined to our second tax season, uh, we have been expanding our programs a little bit, um, to also provide a additional pro bono, um, program called Tax Advisors, where we have our credential tax professionals, um, on a team prepare more complicated tax returns for undergrad students with kiddie tax, uh, obligations, uh, just because that is something that is outside the scope of VITA program. Um, and so we couldn’t prepare those in the past. So we kind of are in a way, um, half pro, uh, VITA sites and half a kind of a pro-bono tax in a sense. Um, and so, uh, but you know, we do have a pretty good partnership with the IRS and a few, uh, good stakeholders in the area.

Emily (07:59): And just for the listeners who aren’t familiar with VITA, maybe they’ve never been to, you know, access to services that are available to them at their university or their library in their city or whatever, can you explain like who that program is for?

Jack (08:10): Sure. So Tax Fellows, um, is, uh, or just VITA program in general, um, is for low income taxpayers, um, who might want some, you know, additional help with their taxes, um, but, you know, um, might not be able to afford say, a tax professional. Um, and so VITA sites, they are run by nonprofits at IRS, uh, partners with, uh, usually and, um, they’re staffed by volunteers, many of whom are credential professionals or retired professionals, but a lot of whom are also just newer, um, folks to the industry who want to get some more experience. That was kind of how I got my experience, um, with taxes and, uh, just kind of, uh, having the IRS, you know, train them, uh, on the volunteers on, you know, these basic tax topics so that they can, um, help prepare your tax returns for you, uh, at no charge. Um, these are all out of the volunteers, uh, generosity, um, of their time. And so, um, but it’s a really great program, um, with a lot of guardrails so that, you know, um, the quality control is usually pretty high. Um, and, um, yeah, yeah, definitely a really great program for anyone who makes under around $64,000 every year, um, and have fairly simple, uh, situations, uh, to get their taxes done, uh, really great and for free. So

Emily (09:39): I’m so glad you mentioned that number. ’cause in a lot of the country people are making less than that amount of money, so it really covers, yeah, a broad swath of people, especially my population graduate students, even some postdocs will fall under that, um, level of income. So they can almost always, if they have a VITA site available to ’em, access those services. And I’m really glad you just mentioned, you know, there’s, there’s guardrails there. Um, there’s only, you have to have a simple tax situation to really benefit. And that’s why you mentioned earlier that you started this tax advisors wing of tax fellows. Let’s talk a little bit more about some of these like confusing tax issues that may be common between like the first generation low income population that you serve, and then the funded graduate students and potentially postdocs population that, uh, that I serve.

The Kiddie Tax

Emily (10:22): So you, you mentioned the kiddie tax, um, let’s brief overview right now about what the kiddie tax is for anybody who has the, uh, misfortune of hearing about this for the first time.

Jack (10:32): Yeah. Yeah. So, um, kiddie tax originally, um, the inspiration behind that, uh, on the legislation side was, you know, a lot of these high net worth individuals, uh, your parents especially would, you know, have pretty high marginal tax rates. What they would do is, you know, have tax professionals who would kind of find all these little loopholes. And one of them is, you know, they could just pass along their investments to their children who are basically making no money, right? Uh, especially if they’re a minor. That way they could both save on taxes, Congress didn’t like that. Um, and so they implement kiddie tax where if, uh, the child is a minor, uh, or a full-time student who didn’t, uh, you know, earn, uh, from a job, uh, so earned income, um, more than half of their living expenses, then they’re considered basically, in a sense a soft dependent of their parents.

Jack (11:33): And so any unearned income that the child has now, uh, will be taxed at their parents’ highest tax rate. Um, and so, uh, that way, you know, the richer parents can’t just pass on their investments, uh, through their children because they’ll be tax rate basically. Um, unfortunately the way Congress defined kiddie tax, um, was very broad. And so it also encompasses, you know, college students who have, you know, taxable scholarship, financial aid, uh, you know, fellowships where, uh, you know, if they don’t have earned income from a job that’s more than half of their expenses, especially at, you know, Stanford where cost of tuition and like the, um, the room board are like an 80 to a hundred thousand dollars every year, uh, if not more. And so the student, not only do they have to like work a, you know, um, full-time job, you know, making more than 50 K to get outta it, uh, it is just a lot of qualifications and so too much complexity. Um, and that’s kind of, um, one of the biggest reasons why, um, we’re so popular at Stanford as while just helping students navigate, uh, through all this complexity.

Emily (12:52): Yeah, that makes sense. And this hits my population all the time. When you’re receiving a fellowship, one of the things about the calculation that goes into the kiddie tax is that your expenses include your education expenses and not just like your living expenses. So that scholarship that goes towards paying your tuition, the cost counts as part of your living expenses, but the scholarship that pays for it doesn’t count on like your side of the ledger of like providing half of your own support. Exactly. Exactly. So, right, so like they get hit with this fellowship, um, issue too. Now, what was interesting about the kiddie tax, I think I read into like the history of this and it seemed like there was like a creep going on. Like at first it was just minors, then it was up to age 19, then it was now it’s students, um, up, up, up until, you know, through age 23, under age 24.

Emily (13:34): And so over time it kind of like expanded and expanded. Um, but there was a reform a few years ago with the Tax Cuts and Jobs act that attempted to, um, make some changes to the kiddie tax. Mm-Hmm . And it really hit your population, that low income population because what they did was they, for a couple of years changed the definition so that, um, no longer were you taxed at your parents’ highest marginal tax rate, but you were taxed at the marginal tax rate for trusts, which simplified things certainly because you would just look at a table and see where you fell on that instead of having to, you know, link your tax return with your parents. But if your parents were low income to begin with, maybe that kiddie tax was not so big of a bite. Now, if your parents were high income, of course it was a big bite, but because it really, really increased those marginal tax rates on those low income populations, there was a big outcry. And after a couple of years, I think it got shifted back to the old model of go to your parents’ tax rate. So that was, yeah, just some interesting like shifts that happened with end time. But yeah. Yeah, the kiddie tax is a very unpleasant thing to find out about.

Commercial

Emily (14:33): Emily here for a brief interlude! Tax season is in full swing, and the best place to go for information tailored to you as a grad student, postdoc, or postbac, is PFforPhDs.com/tax/. From that page I have linked to all of my free tax resources, many of which I have updated for this tax year. On that page you will find podcast episodes, videos, and articles on all kinds of tax topics relevant to PhDs and PhDs-to-be. There are also opportunities to join the Personal Finance for PhDs mailing list to receive PDF summaries and spreadsheets that you can work with. Again, you can find all of these free resources linked from PFforPhDs.com/tax/. Now back to the interview.

Paying Estimated Taxes as a Graduate Student

Jack (15:38): Oh yeah. So, uh, especially for like first year grad students, uh, who have like a lot of taxable stipends ’cause they get like stipend checks, uh, usually and, you know, they would owe a pretty significant amount of taxes. Uh, and so to, to a point that they definitely need to pay estimated taxes, not only like to avoid the underpayment penalty, but also to, uh, just not be surprised at the tax bill end the year and try to like, try to recoup all the money, um, to pay, uh, substantial tax liability. And so, uh, we’ve been educating, um, grad students, um, as they come in, especially the first year grad students, uh, kind of how to pay estimate taxes. ‘Cause we also have California and they have like, their kind of special snowflake. They have like very, um, specific percentages, um, where it’s like 30%, 40%, 0%, 30% for like, the amount of estimated taxes that need to be paid.

Jack (16:31): Federal is like pretty straightforward. It’s just one fourth of the tax every quarter. Um, but just kind of educating students on like how to pay those, uh, payments, trying to figure out, um, how much to pay. Uh, and then kind of repercussions if they don’t, uh, pay as many taxes. ’cause you know, uh, students they could be busy and so, uh, you know, I’ll just kinda let them decide based on all the facts available, like whether um, it’s worth the effort of doing as many taxes. Usually it is, ’cause like usually if you don’t do it, um, for students that we have, um, served, their penalties are gonna be around a two, $300 range, uh, in this economy with, uh, the inflation. ’cause the penalties really based on just interest, um, and the interest rate that r assets for, you know, all, all their penalties and interests and, um, it’s just prorated across the year, uh, based on the, um, estimated tax payment you’re supposed to make, uh, from that date on, um, to the tax season. And so right now, uh, usually the past the rate was like 3% and so it wasn’t too bad, but right now the rates are in a 7% range. And so it’s definitely significant.

Emily (17:44): I found that as well that a lot of graduate students are aware of the estimated tax issue, but they just choose to not address it until tax season. And if they go into that with their eyes open, of course that’s their decision. But, uh, like you, I just try to lay out, okay, this is the trade off if you decide you’re going to neglect this.

Jack (18:01): Yeah. Yeah.

Emily (18:03): I think the real tough part is ra- facing that, you know, multi-thousand dollar tax bill that you exactly may not be prepared for.

Jack (18:10): Exactly. Because, you know, yeah. Students are also taxed on your part of the fellowship that goes to room board and room board in the Bay Area is pretty significant. Um, and so not only do students have to usually save for taxes on their stipend checks, you also have to like figure out, um, how much tax to save on housing, uh, stipends and some of the other stipends. And I feel like, you know, right now there’s not really a good way for the students in general, I feel like maybe it’s just more of a lack of re- uh, educational resources in the first place, um, where students aren’t being told, uh, to expect significant tax liability, um, on their stipend checks and like making sure that they save money for taxes. Um, there’s no, you know, mechanisms like withholdings where the schools will pay the taxes on the student’s behalf and so the students just kinda have to like figure it out, um, and learn the hard way , uh, during their first tax season. Um, and I feel like, you know, that’s not really the way to go. Uh, that there definitely needs to be a lot more resources, uh, for across all the universities, uh, in the country, uh, to really help educate these students on their tax liability and really help support them through it as well.

Emily (19:27): Yes. You know, I agree with you of course ’cause this is one of the main missions of my business, but, um, we’ll talk more about how people can sort of get more resources and get more education to their own peers, um, later on. But I just wanna add on that point. I mean, Stanford, obviously, you and I are both working with people at Stanford, so like Stanford’s obviously making a pretty, a relatively large effort in this area. Sure. Um, to get people informed about this. But I, it’s, um, I do not see this at this degree of resources being offered at many other places, which is to add, but I will tell you that there are a couple universities I went to one Duke, um, where they actually did offer income tax withholding on fellowships. I don’t know how or why it happened. I mean, the paychecks were being processed through payroll instead of through financial aid.

Emily (20:10): So there was a mechanism for doing it. Um, and it did generate a weird tax form. We got a 1099 miscellaneous instead of a, you know, 1098 t or whatever. Sure, sure. Yeah. Um, so it caused some downstream tax complications, but they did offer it. So that is something that I know is happening at some places and maybe it could happen at more places and it would certainly be easier on the students than having to engage with the estimated tax system. So Now that we’ve kind of talked about, like, you know, this example of the kiddie tax, how the kiddie taxes changed with time, um, how advocacy actually around after the pa after the passage of the Tax Cuts and Jobs act, when, you know, the tax rates were jacked up for these low income families, there was an outcry and it was reversed. I want you to give us a few examples, if you don’t mind, of Yeah. Some things that have changed within the tax law over time, uh, that relate to students, just so we can see some examples of like, this is not completely static, like these things do change.

Advocacy Around the Kiddie Tax, Taxable Scholarships, and Other Niche Financial Issues

Jack (21:02): Yeah, yeah. So, um, right now we’re actually trying to do some advocacy, uh, around the kiddie tax and the taxable scholarship arena just because, uh, it is, I’d say slightly outdated, uh, set of tax law. Um, you know, it was most recently updated back in, uh, the 1986, um, uh, tax changes. Uh, there, there were some major tax changes back then, uh, and never since, like since then, like I’d say like the, just the way scholarships and financial aid work, especially at like, you know, expensive private universities like Stanford, uh, and like the Ivy League, um, like it tuition has just gone up significantly where I don’t think it really makes sense anymore to put a lot of that tax burden on students. Um, and without any, like, you know, as you mentioned, like, uh, stu- you know, schools have to like put withholdings on a 1099 miscellaneous.

Jack (21:59): Um, so like, there’s not really like a, a mechanism say on a 1098 t or another like educational oriented form, um, to really help students, you know, save a little bit on their taxes, um, you know, having those taxes being taken out already. Uh, and so we’ve been, uh, trying to do some advocacy around their, uh, you know, the legislative side who’ve met with, um, the late Senator Feinstein’s office, uh, and representative Eshoo’s office, uh, who represents the district Stanford’s in, um, to kinda discuss about, um, you the struggles that students are going through with K tax and, uh, especially like undergrads as well, where they don’t get stipend checks really. Um, but even the in kind aid for, you know, room and board, you know, especially on top of like internship income, that is pretty significant. Uh, burden, you know, we typically see like about two, two, $3,000 of burden on in-kind aid, so money that the student never sees.

Jack (22:59): Um, and so they have to like work a, you know, good like on-campus job just to pay the tax on again, money that they never see. And so it, it’s a struggle. I mean, um, we’ve been, um, able to help the students save a little bit on taxes, you know, optimize, uh, with the parents, uh, so that we dumb it down to about, uh, a few hundred dollars, but even a few hundred dollars is pretty significant for these income students. And so we’ve been really help, um, working with in these, um, legislators, um, on, you know, ways that we can really change the tax around us. Um, and, you know, the judicial side as well, trying to poke holes and, um, kind of, uh, tax code surrounding, uh, these topics, uh, through tax court. Uh, and we might even, um, do some advisory, um, and meet with advisors through, uh, President Biden’s office, uh, very soon here. Yeah. Even on this, uh, university side as well, uh, you know, trying to get, you know, support fund going for, uh, you know, students to pay their tax liability, uh, especially in the first years where they might not expect such high liability, uh, and it would be, you know, challenging for them to pay those liability. Uh, but it’s been, it’s been tough working with Stanford, um, for now. Uh, but we’re still keeping at it and, and we’ll see kind how it goes, uh, over time. Yeah,

Emily (24:30): I think the kiddie tax is such a great example of an issue that’s right for change, just because, you know, the way you explained it earlier, which is the way that I understand this as well, is the original, um, conception of the kiddie tax was to make it less advantageous for high net worth parents to pass assets, income generating assets to their children. And that is not at all what is going on with scholarship and fellowship income. It’s, it’s perplexing to me how scholarship and fellowship income even got tied in with investment income in the first place. Yeah. Yeah. I, it’s, it’s completely baffling to me. Yeah.

Jack (25:04): Well, I mean, even with leg- legislators, uh, you have with, uh, it’s been, uh, it’s been challenging for them to just, I guess like, um, everyone has, um, like especially legislators have, you know, lots of, uh, different priorities that they need to kind of first, um, solve. And so I guess we weren’t too high on the set priority list. Uh, I mean, hopefully they’re, that they’re working on it, but, um, it, it’s, it’s, you know, a lot of politics as well. And so it’s a, it’s gonna be a long game, but, um, we we’re pretty committed to, you know, doing long-term advocacy around this, um, gonna go at it, um, as long as this is a thing, uh, and, you know, just some interesting, uh, statistics as well. So, um, you know, yeah, can tax, like, as you mentioned, like it’s definitely for, you know, these high level worth parents, uh, and their children.

Jack (25:58): And so typically the median, uh, an average income that we see for, um, you know, students or just children who have to fill out the kiddie tax form 8615, the me-, uh, the average parents income is actually in a, uh, about $1 million, uh, taxable income. A lot of these low income students, their parents are not making a million dollars . Um, and so like, yeah, this is definitely unintended consequence of the way legislators wrote the tax. Uh, and even for taxable fel- um, scholarship fellowship in general, uh, it’s heavily under-reported, uh, only about $4 billion of taxable financial scholarship and fellowship are, is being recorded. Uh, and so it, it’s, you know, it’s an area of the tax field that, you know, Congress and IRS isn’t really making a lot of money, um, in, in the first place. Uh, and so, uh, you know, using those arguments, you know, we’re hoping to really push along the change a little quicker, uh, especially ahead of the upcoming, uh, sunset of the TCJA, uh, Trump, uh, the Tax Trust and Jobs Act, uh, back when President Trump passed it, uh, just to kind of see if we can push along, um, uh, as a rider on, uh, those big tax bills that are coming up soon on the Congress side.

Jack (27:24): So, so we’ll see. We we’re, we’re definitely, uh, steadfast our commitment, uh, to advocacy here.

Emily (27:30): And I mean, I’m, I’m so excited about this and I hope you keep , keep it up and everything, and I’m just, um, I’m really inspired by like the story of how the definition of taxable compensation change for the purposes of contributing to an individual retirement arrangement. Because that also seems like a very, very tiny niche issue, right? The, the Graduate Student Savings Act to, if anyone is not familiar, it used to be that fellowship income not reported on a W2, was not eligible to be contributed to an IRA. And this was proposed, you know, federally several times in terms of the Grad Student Savings Act to change this definition so that it could be, and it failed several times until it finally got rolled in with the Secure, the Secure Act in 2019, and it was passed. And like, again, it was a thing that mattered so much to like my population, um, and it was amazing that it passed.

Emily (28:17): But yeah, that’s a really, really niche issue. And hopefully, again, some of these other niche issues like the kiddie tax can be addressed too. I actually have one more example. Yeah. So the tuition and fees deduction, they tried to eliminate that over and over and over again, and it kept being like resurrected year after year. It’s finally gone now. But again, for the listeners who were not in graduate school, maybe a few years back, yeah, there are currently three higher education tax benefits, but there used to be four available. The fourth one was the tuition fees deduction. Yeah. And it was the least useful and valuable one, and it ended up, I mean, the reasoning why they kept a congress kept trying to sort of sunset that particular de deduction was that it ultimately just confused people more. And so people would take the tuition fees deduction Mm-Hmm. when really one of the credits, for example, might have been better for their tax liability overall. Mm-Hmm. . So my understanding was it was causing more confusion and they just eliminated it. And it, it kind of sounds bad to like, oh, eliminate a deduction that was available to you, but really there were better ones avail better credits available. Yeah. Yeah. So that was another, I just kept watching it year after year being like, okay, it’s finally gonna die. No, they brought it back again, finally. Now it is gone.

Jack (29:24): No. Yeah, yeah, yeah, it’s definitely confused. Uh, so the students I’ve served in the past as well, um, and like there’s just, I think there’s a lot of different ways Congress is, uh, trying to help with education expenses, uh, through tax code, but, uh, you know, I don’t think, you know, with the taxable financial aid, fellowship scholarship, uh, section, um, there’s definitely a lot more potential there, uh, for, uh, you know, change. And so we’re definitely, uh, um, hope that Congress can, you know, really take up our word. And there’s definitely a lot of other nonprofits like us, uh, that I’ve met with who are also advocating for same thing as well. Um, you know, typically we don’t really see audits rates that high, especially for students. But even then, you know, none of my clients have gone on in knock on wood, uh, yet.

Jack (30:16): And so, uh, but yeah, I’ve definitely heard from a lot of these other nonprofits, some of the students that we’ve been working with. You know, there’s one, uh, one of the organizations that was, uh, serving foster youths, uh, that I met with, and one of their foster youth got audited on their taxable financial aid fellowship, uh, scholarship. And the outcome is not pretty. Um, so, uh, it’s definitely, uh, one of the biggest and one of the most urgent issues that we’re trying to tackle. Um, not only on the legislative side, but also, uh, just kinda on university side as well. Just especially the, um, private institutions like Stanford and, uh, the Ivy League. They have a lot more resources that they can more easily deploy. Um, and, you know, that’s quicker than, you know, trying and, you know, make change on the, uh, policy side of things. But yeah. We’ll, we’ll see.

How Graduate Students Can Advocate for Tax Related Resources at their Universities

Emily (31:11): Do you have any ideas about how graduate students at other universities can, um, do any kind of advocacy work or just ask their university for anything that would help them sort of gain more resources or, um, education or anything that would help them on this, you know, in, in tax season to, to handle things a little bit better? So like, what can they, maybe not, of course, founding a whole organization like you did but some little things they could do at their university to get some more attention to these issues.

Jack (31:39): Yeah, that’s great. Um, I think, uh, you know, for example, let’s say your podcast and kind of your resources are great, you know, great starting point. Uh, you know, one of the partners that we’ve worked with at Mutual Partners here, uh, Mind Over Money, uh, they’ve, uh, spoke really highly of your resources. And so that’s definitely a great starting point and just kind of advocating for universities to, um, kind of, uh, provide resources and kind of distribute resources, um, across, uh, campus. But also I think like, you know, while not, you know, maybe not founding a whole, you know, uh, tax program from scratch, but, you know, if a university has a law program, uh, then definitely would recommend, you know, working with Senate faculty there, uh, to try to set up, uh, maybe in con- conjunction with United Way usually has, uh, VITA programs already set up. And so just kind of, uh, using existing infrastructure in support of, uh, VITA sites and just kind of start, you know, a small one. It could be a small one, just trying to start out, um, kind of helping other students through their taxes, um, and then trying to attract like, you know, tax professionals and lawyers to the organization.

Using Caution When Getting Tax Help as a Graduate Student

Emily (32:47): So I observed with the VITA site at Duke, um, sure. Sorry to speak against them, but, um, yeah, they were not preparing returns properly with the weird fellowship stuff that was going on at Duke. I see. So I would just say whether there is a VITA site or whether you wanna start one, make sure that they know the population that’s gonna come in and the questions that they’re going to have so that they can train their volunteers specifically towards the situations that they’re going to see Now, because of the weird way that Duke did things, like I actually understand why the mistakes that were made were made, and it might be easier at other places that don’t use the 1099 miscellaneous. Sure. Yeah. Um, but yeah, just to let them know like, Hey, I’m gonna tell all my friends to come in and like, make sure that your volunteers can do this Sure. Correctly and easily and quickly. Definitely.

Jack (33:29): Definitely. Yeah. I mean, we don’t really see a lot VITA sites and universities, uh, where we really should. But, um, even a lot of, uh, sites that I’ve seen, um, at universities, you know, I’ve kind of had a connection with Yale, um, and I wanna say, uh, UC, uh, Santa Cruz as well, uh, in California, uh, they, I I wanna say a lot of them only serve low income tax payers that are not students. Um, and like they don’t orient these services to students, which I think is a good approach, especially if they’re newer site starting out, uh, and not have a lot of those more experienced volunteers, uh, or professionals to kind of guide, you know, the volunteers. But yeah, you, you mentioned a really great point, uh, which is that like, you know, not all VITA sites and even tax professionals I’ve worked with in the past, you know, who have like decades of engineers, not all, you know, professionals or VITA sites, understand, um, kind all the ins and outs of the tax code that are relevant to students.

Jack (34:33): Uh, I’ve even had tax professionals think that, you know, taxable financial is not taxable , um, that was, that’s the you highest extreme I would say. But, uh, even just like optimizing, especially for a lot of undergrad students, optimizing, you know, the, um, you know, parts of the tax, you know, involving, you know, like tax credits, you know, deductions, you know, against their financial aid, uh, and along with their parents, you know, their parents who might be, you know, claiming for example, like the earned income tax credit, um, or the premium tax credit for health, uh, insurance or a lot of other tax credits and just like coordinate the, uh, tax credits that both the students and the parents are claiming, uh, to maximize those resources that that takes a lot of expertise, uh, to do correctly. Um, and so I definitely agree with you there.

Jack (35:25): Um, definitely do be careful, um, with, you know, starting VITA sites, uh, and with just tax professionals in general, just making sure that they actually have the expertise, um, and experience serving students, uh, in order to serve you, uh, you know, better and more accurately. And so I think our, our, uh, you know, tax fellows, um, uh, program, I’m very glad I’m able to, uh, you know, help students, uh, using their expertise. Um, and you know, we’ve been invited, uh, to train other volunteers at other VITA sites, uh, in these student tax considerations. And so, you know, if you’re thinking of starting VITA site, uh, please do reach out, uh, to us at Tax Fellows. Uh, happy to kind of, um, kinda walk you through the steps of starting VITA site, uh, and managing a VITA site, but also kinda allow of the student tax, uh, considerations that, uh, you should think about and kind of consider and, you know, we’ll do some more practice together, uh, on it too.

How Universities Can Support Graduate Students Around Taxes

Jack (36:20): But yeah, I think just in general, um, working with university administrators, uh, and the folks who, uh, you know, run orientation programs to add another orientation session might be just, you know, even if it’s just like one hour long, um, just to kind of prep students for what they should expect with taxes. You know, a lot of these like, you know, big picture, you know, policy changes, you know, like, uh, university like, just kinda like resource changes. Those take time. But I think you just adding another program to orientation, uh, for new students, that’s a really good first step that I think doesn’t take too much convincing to do and will be really effective, uh, to really help students, um, kind of foresee what they should expect at tax season, uh, so that they don’t have to, uh, you know, get surprised, you know, kind of play the game of Russian roulette and like try to, you know, guess and pray, you know, for the best I guess. Yeah.

Emily (37:31): Yeah. And I’ll just have to do a self plug because I have a session like that that’s ready to go. It’s perfect for orientations. It’s live, it’s awesome. Um, yeah, so those of you who are listening, if you, if you want me then please, you know, reach out to me, reach out to administrators at your university. But I would actually say just even back up from that, um, yeah, just talking about the issue of, or like the struggle that people that you’re having with your either preparing your tax return or dealing with your estimated tax or whatever it is, just telling the faculty and the administration that you have concerns about this and you want them to provide resources to you is very, very helpful. Um, because a lot of universities are super reticent to touch taxes with a 10 foot pole because of perceived liability issues on their end. Now it’s kind of funny because they, they do help international students to a great degree. They don’t usually offer the same kind of help for domestic students. Um, but if you tell them repeatedly and get a lot of people to tell them that you want more resources around this, then that’s, I think, the best they can figure out how they want to meet that need. But just letting them know that that need is there, that that concern is there is a wonderful first step.

Jack (38:34): Definitely. Definitely. Yeah.

Best Financial Advice for Another Early-Career PhD

Emily (38:36): Okay. So Jack, thank you so much for giving this interview. It’s been wonderful to speak with you. Yeah, thank you so much. And I want to end with our last question. Sure. Which is, what is your best financial advice for a funded graduate student or an early career PhD? And it can be something related to taxes if you want. It could be something that we’ve talked about during the interview, or it could be something completely different.

Jack (38:56): IRAs, I cannot emphasize enough how important and just like life changing that IRAs could be. Um, you know, there’s definitely, you know, for, you know, especially grad students, uh, PhD students, uh, you know, once you, you graduate, you, you might go into academia, but if you go into industry, uh, where you’re getting paid, you know, six figure salaries out-, out the door, it’s gonna be, you know, you could still contribute to say like a Roth IRA, but uh, it’s gonna be a bit more difficult and there’s like backdoor stuff to consider. But um, you know, now is the best time for a lot of, you know, grad students with their income level to contribute to Roth IRA while they still can, uh, easily. And you know, once the money is in, it’s a basically tax free, um, forever, uh, you could invest in, you know, stocks, you know, um, even occasionally startups, if that’s kind of your thing.

Jack (39:58): You know, I’m a little biased. I, I, I’m running a startup and like Stanford really good on startups, but, uh, you, that’s how you know folks like for example, Peter Thiel, um, have, you know, so much money that’s tax free is because he was able to contribute while he was, um, having lower uh, amounts of income in his early days. Uh, and then, you know, once the money’s in, there’s a lot of flexibility, uh, and ways to really help maximize your investments. Uh, while at the same time not having to kind of hinder the compounding growth of this investments with tax payments, yet I have to make, um, you know, on like dividends or interest or whatever. And so, yes, definitely Roth RAs is big and like, you know, lot students are also younger as well. And so the growth potential for those Roth IRAs across, you know, 46 years is gonna be huge. Uh, and so definitely do look into Roth IRAs as soon as you can contribute as much as you can, uh, ’cause you know, later down the line, uh, your future self will definitely thank you for it.

Emily (41:04): Absolutely could not agree more. My current self, thanks my grad student self were contributing to my Roth IRA back then. Not to put an even finer point on it, you know, as a graduate student you’re probably in the 12% federal marginal tax bracket and you may never see that one again. you maybe exactly, you know, above that for the rest of your career. So like exactly, that is the time to do it and it’s incredible and I love this advice because it’s both tax and overall financial, um, advice and it’s wonderful. And Jack, again, thank you so much for coming on the podcast.

Jack (41:34): Yeah, thank you so much for having me, Emily. It was great, uh, chatting with you.

Outtro

Emily (41:48): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by Dr. Lourdes Bobbio and show notes creation by Dr. Jill Hoffman.

A Political Economist Explores How to Respond to the Financial Pressures on Graduate Students

January 22, 2024 by Jill Hoffman 1 Comment

In this episode, Emily interviews Michael Dedmon, a PhD candidate in Political Science at Syracuse University and the Director of Research at the National Endowment for Financial Education. Michael’s research focus is in political economy, particularly in how governments respond to economic crises like the Great Recession and the COVID-19 pandemic. Emily asks Michael to share his view of what is happening in academia today as both a graduate student and a person with relevant academic expertise. They discuss how the strong labor market, high inflation, the lack of affordable housing, and constrained state and federal budgets for education and research are putting so much financial pressure on individual graduate students. Michael also explores the avenues for advocacy that are available to graduate students, such as unionization.

Links mentioned in the Episode

  • PF for PhDs Tax Workshops (Sponsored) 
  • PF for PhDs Tax Workshops (Individual Purchase)
  • PF for PhDs Subscribe to Mailing List
  • PF for PhDs Podcast Hub
  • Michael Dedmon Twitter

Teaser

00:00 Michael: Unionization is just one of the ways, right? That graduate students can really sort of band together, right? Really use that solidarity with one another and with graduate students across universities. To really sort of fight for a situation that really helps them reduce their vulnerability, but then also build a good financial sort of basis as they go into their career in academia, which is kind of a separate conversation. But we know that the challenge is right to. To living a financially secure life as an academic, are extremely challenging. So if you sort of start right from a negative as a graduate student, it sets you up for a lot of problems down the road.

Introduction

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

01:12 Emily: This is Season 17, Episode 2, and today my guest is Michael Dedmon, a PhD candidate in Political Science at Syracuse University and the Director of Research at the National Endowment for Financial Education. Michael’s research focus is in political economy, particularly in how governments respond to economic crises like the Great Recession and the COVID-19 pandemic. Michael shares his view of what is happening in academia today as both a graduate student and a person with relevant academic expertise. We discuss how the strong labor market, high inflation, the lack of affordable housing, and constrained state and federal budgets for education and research are putting so much financial pressure on individual graduate students. Michael also explores the avenues for advocacy that are available to graduate students, such as unionization.

02:02 Emily: The tax year 2023 version of my tax return preparation workshop, How to Complete Your PhD Trainee Tax Return (and Understand It, Too!), is now available! This pre-recorded educational workshop explains how to identify, calculate, and report your higher education-related income and expenses on your federal tax return. Whether you are a graduate student, postdoc, or postbac, domestic or international, there is a version of this workshop designed just for you. While I do sell these workshops to individuals, I prefer to license them to universities so that the graduate students, postdocs, and postbacs can access them for free. Would you please reach out to your graduate school, graduate student government, postdoc office, international house, fellowship coordinator, etc. to request that they sponsor this workshop for you and your peers? You can find more information about licensing these workshops at P F f o r P h D s dot com slash tax dash workshops. Please pass that page on to the potential sponsor. Thank you so, so much for doing so! You can find the show notes for this episode at PFforPhDs.com/s17e2/. Without further ado, here’s my interview with Michael Dedmon.

Will You Please Introduce Yourself Further?

03:27 Emily: I am delighted to have joining me on the podcast today, Michael Dedmon, he is both a PhD candidate, Syracuse university, and currently an employee with the National Endowment for Financial Education. And he and I met at a conference this past summer, the higher education financial wellness summit, where I was listening to him give a presentation. I said to myself that man has a PhD. And so I approached him afterwards and found out, I was almost right, he’s almost to the PhD,  Um, and yeah, so Michael, I know we’re going to have a fascinating conversation today. I’m really looking forward to it. Would you please introduce yourself a little bit further for the audience? 

04:01 Michael: Absolutely. Well, first, thanks so much for having me. This is really a great opportunity that was totally unanticipated from that particular, uh, presentation. And I’m really thrilled to be here. Uh, well, I guess by way of introducing myself, uh, I’m from Colorado originally. That’s where I live. Currently. Um, I’m a 1st generation college student. Uh, and so by that extension, you know, also very much. So 1st generation PhD student, uh, I started off, uh, studying international relations at the American University of Paris. Uh, and then I studied in an MA in European politics at the European Institute at the London School of economics. Really, I had even gone into that MA level, really kind of wanting to focus on foreign affairs and international relations, but it was really kind of at that sort of stage where I really started to be pulled more in the direction of studying political economy after taking a few years off after the sort of starting with some early career research experience. I started pursuing a PhD in political science at Syracuse University. Where I’m currently a candidate, um, as a graduate student, you know, I got a couple of different, you know, sort of areas of research experience worked at a small research initiative focused mostly on international NGOs. And the Moynihan Institute of global affairs, uh, and then when I was more advanced in the PhD process, sort of started working in this field of financial security and financial education, uh, it started off at a smaller nonprofit in Brooklyn. Where I focused on identifying barriers to financial security for low and moderate income families, mostly in the New York City area and recently joined the National Endowment for financial education earlier this summer as the research director. And and I’m also an adjunct instructor in the political science department at the University of Colorado Colorado Springs. So, sort of maintain my academic connection in that regard. 

Research Interests: Financial Crises, Financial Security, and Financial Education

05:52 Emily: So listeners, what we’re going to do with this interview is take all this fascinating experience and expertise that Michael has and ask him to apply it to the PhD population instead of the populations that he’s been typically studying and working with. Um, and since he has that personal experience being part of that population, I think it’s going to end up being a great conversation. Okay. So you went, uh, over that, you know, your CV a little bit. Is there anything that you’d like to dive in further and tell us more about that’s going to be relevant to our conversation today?

06:21 Michael: Well, I could maybe. Sort of start by talking a little bit about what really brought me sort of out of the academic, you know, sort of world and into this sort of field of financial security and financial education. Um, you know, I could maybe start by talking a little bit about what informs sort of my personal research interests, I guess, uh. You know, starting maybe with my, even my dissertation project and my dissertation work, uh, which is broadly speaking, sort of focused on the politics of economic crisis, specifically the politics of how and when governments choose to intervene to support individuals, families. Businesses really anybody in response to difficult economic times. I’m especially interested in how policy makers and academic experts. And politicians make sense of economic crises, how that sort of, you know, the frames, uh. Narratives the stories, the interventions that they think are necessary, uh, maybe have changed over time, uh, and what the political sort of determination of those stories that they find compelling are, um, my project specifically sort of asked this question in relation to the 2008 financial crisis, uh, and the recent economic consequences of the COVID 19 pandemic. Uh, you know, in 2008, we saw a certain type of discourse around what caused that particular crisis, how government should respond and what types of policies were needed to protect certain groups or certain firms or certain banks or businesses and then ultimately to get the economy back on track and, uh. Really, it was kind of my interest in how governments, how we, as people, how society makes sense of these types of crises and how the really serious consequences that individuals and families, especially people that are already vulnerable, uh, how they experience those crises and how that informs our politics. That’s really kind of what drew me, I think, into this particular field, which I would say is, you know, sort of the field of research and policy and advocacy that’s really focused on trying to understand the barriers that people. Uh, face to living their best financial lives and experiencing economic security and financial well, being, uh, and it’s been a really fulfilling experience. I think, to try to apply my academic interests, uh, both in the sort of policy and advocacy space. And then now, and, and, uh, I would say more of a broader, you know, sort of research, uh area looking at how financial education is just one out of many different ways that we can address economic insecurity and barriers to financial well being.

Financial Journey as a First Generation College Student

08:48 Emily: Of course, I love that working in the field of financial education for a number of years now. It’s so apparent to me in the last few years that there’s so much policy work that needs to be done, um, for us to even get to a point where financial education can be effective and can, it can really help people. So, um, I love that message. Um, would you like to add anything more about your personal journey through this period. 

09:09 Michael: You know, I couldn’t agree more with you as well, just really about seeing financial education really is sort of existing within like an ecosystem, right? Of issues in the ecosystem of problems. Really? Uh, that our society sort of has, uh, is presenting to individuals and families to living their best financial lives. And I’ve definitely really experienced that in myself. Um, you Not just before, you know, being a PhD student and after being a PhD student, or at least, I guess, after being really focused on the coursework, but being a graduate student as well. Um, you know, for me, and my personal sort of finance journey is really informed in a lot of ways by being a 1st generation college student. Uh, you know, could even say seeing, I would say, I guess, the, the sort of financial and economic struggles that, uh, that my parents, I think, experienced not having attained that college education, uh, trying to figure out, I think, how they were going to find their place in a labor market that was. I guess, maybe presenting different kinds of barriers to them being successful. You know, I kind of come from a family, like a lot of 1st generation college students where, you know, the idea of going to college was presented a little bit as a non negotiable. Partly because of how my parents understood their own experience and their own struggles. Um, and then. You know, my academic research interests, uh, are really sort of informed by how I experienced the financial crisis sort of period and in the U.S. and in the advanced industrialized world specifically. I mean, I was still in college. It was junior. Uh, no, I was senior in college, I guess, in 2008. so I sort of graduated in the spring of 2009 into 1 of the worst labor markets, right? That there was, uh, And not really sure exactly sort of how I was going to make my way, like, apply the things I had learned and and really just sort of start my career. It’s part of the reason why I continued on right away by pursuing an M. A. because it seemed. No, like, a lot of us, it seems like an answer to that question of what I was going to spend my time doing when we were looking at such a difficult economic situation. So, even though I was studying something else, and, you know, at the time had kind of, I think I wrote my master’s thesis on the relationship between the European Union and Russia. Which, uh, funnily enough, at the time, a lot of people said it was a very boring topic. Of course, that’s not the case now. Um, but, uh, what really pulled me to toward political economy and trying to think about these issues of, of, uh, financial security and political economy in general is seeing the extent to which the financial crisis created so many difficulties, uh, for people to sort of find financial security after, after that event. And really just being fascinated with the, the political and policy conversation about How we made sense of something like that. How did we sort of understand the fact that the economy had, uh, experienced this shock? How did we make sense of trying to get the economy back to growth? And how did we make sense of the fact that that really didn’t happen right away in most of the advanced industrialized economies?

12:11 Michael: Uh, so that was really, and experiencing that myself, I guess I would say, right? Uh, even coming out with an MA facing a tough labor market, you know, I found myself struggling to pay rent, struggling to sort of figure out, I think, how to. To to get on the career ladder, uh, you know, working a retail job, you know, going back and forth, you know, to different interviews. I have this very, very clear memory of, um. Interviewing for a job, I think is like an office manager at a at a apartment complex and I kind of remember leaving my job at the gap. A little bit early and getting in the car and driving, you know, and then showing up at this apartment complex and interviewing with what had to have been like, 35 or 40 other people, all of us standing there and, you know, uh, you know, press shirts and ties, you know, for like, uh, an entry level office manager job. And I think that that’s, that’s the experience that a lot of people had really just kind of trying to figure out what their place is going to be in a labor market. That was really, really not recovering from the crisis anywhere near fast enough. Uh. Okay. So that was really, I think, uh, a really big inspiration for me to try to understand what’s the government’s role in responding to those types of crises. And why were the types of responses that we saw to the 2008 crisis not working? Right? And that wasn’t just in the United States that we were experiencing that. And that was countries across, you know, the United States and North America and Northern Europe, um, where my research sort of has taken me. But, uh, yeah, that was really just a really, really important part of my personal. You know, development that informed, I think, my future research interests and, and now it’s sort of become, uh, really central to my career. 

Comparing the 2008 Financial Crisis to the COVID Crisis

13:52 Emily: What a vivid story. And I’m also thinking now about, you know, you made a comparison earlier, just that you’ve been thinking about the 2008 and 2009 financial crisis versus the COVID crisis that we’re having now. And I’m thinking about, um, someone listening to this podcast who is a recent college graduate and maybe graduated in 2020 or 2021. And how is what, I don’t know, can you tell us a little bit about generally over at the population level, how what they’re facing is is different or similar to what you and me and other of our peers experienced during that earlier crisis?

14:28 Michael: That’s a really fantastic question. Um, in a lot of ways, I think it really highlights how different the situation and the sort of post uh, landscape is compared to 2008. Um, And I think that should really cause us to ask a lot of really difficult questions, right? About why it is that, you know, maybe you and me, other people in our sort of, you know, cohort, uh, had such a different experience. Because 1 of the things that you really see, and I think we’re seeing additional evidence of this really every day, especially in the United States with additional sort of economic statistics is that the labor market situation that you and I faced, right? When we graduated from college, you know, in the early 2000s. Was one in which the premium, the benefit that you got from having an, uh, you know, higher education was certainly still there. But, um, the barriers that we were facing to really getting on the career ladder were really, really extensive. Um, there’s a lot of scarring in the labor market, meaning all of the layoffs really that had happened or the long term unemployment that people had experienced in the immediate sort of period after the financial crisis took a really, really long time to recover in the United States. There’s a lot of different explanations at the time for why that was. Uh, right you had a lot of people that were focusing on saying, well, maybe the unemployment insurance that the government offered in response to the crisis was too generous, right? It was keeping people from from taking additional jobs. I think we can kind of look back and see, especially given the extent of unemployment insurance, I guess, uh, generosity in the 2020 COVID crisis. That is a really, really difficult explanation to take seriously. 

16:03 Michael: But anyway, there were a lot of different reasons why economists sort of trying to understand why the labor market was taking so long to recover and why it was so difficult, even for people with college educations to really get on the career ladder and get a job that was going to pay them a living wage so that they can pay rent and pay the other expenses they needed. One of the biggest differences is that in part, because, uh, the government took a much more active role in responding to the downturn, uh, that was sort of caused by the COVID 19 pandemic that the labor market did not experience that same type of slow return to normal. After 2020, in fact, you sort of saw the opposite, right? Businesses had trouble hiring folks. They had difficulty hiring people to fill the jobs, which, uh, had a really, really beneficial impact on wages. Also, just something was completely different from what happened in the after the 2008 financial crisis. You had a labor market situation, which was incentivizing businesses. To try to pull people into those jobs, so they were offering higher and higher wages, right? This is sort of where you saw, you know, people getting offered 15, 16, 17, even in some places to work, uh, you know, places like McDonald’s coming after a number of years where fast food workers were trying to organize and demand, right? A 15 minimum wage in those same jobs. And we’re experiencing a lot of barriers to making that a reality. So on the one hand. The government’s willingness to spend a lot of money in response to the 2020 pandemic to try to make sure that vulnerable people specifically, uh, didn’t lose their homes. Didn’t lose housing. Uh, didn’t get too far behind on making payments on their debt or their mortgages or other types of, uh, you know, that’s that they had. Really put the economy in a much stronger position to recover afterward and in terms of facing, you know, labor market opportunities is 1 of the best ways to see the positive impact of that response.

17:56 Michael: And so, I mean, I don’t know. I’m interested to kind of know what you think as well. Talking to so many folks who are sort of leaving the, the, the graduate school situation and thinking about their finances. But I would say that on the whole, I think people are facing a very different type of labor market now that are not experiencing the same type of restriction of opportunities. That we experienced after the 2008 crisis, that’s not to say that they don’t also face a lot of difficulties, right? In terms of. Making the most out of their careers, earning a living wage, feeling like they have what they need to live their best financial lives. But in terms of the. Barriers they’re facing in the labor market. It’s really not quite the same. 

18:36 Emily: Well, I was thinking about so I entered graduate school I should say I entered PhD training plans to go into a PhD program in 2007, which is when I graduated from college So it was just before so I was kind of safely ensconced in my PhD program by the time things really started going downhill in 2008 and I say safely because my lab happened to be well funded which obviously is a very real concern inside academia my lab in the area it was in, we had funding, my, my funding was secure during that time. I don’t have any statistics on this at all or even anecdotes, but I’m just wondering if, you know, comparatively the stronger labor market, as you were talking about, um, didn’t incentivize people to go into academia to start those graduate programs and start the PhD programs in the last few years in the way that, again, we experienced back in 2008, 2009, 2010. Um, Um, yeah, so I’m just kind of thinking about maybe the different pressures on people and when they can choose to go into a job that would be satisfactory to them, then maybe earning a decent amount of money and they think, Oh, I was sort of interested in going to graduate school, but I can put that off for a few years and I’m going to work this job for now. Um, I don’t have those numbers on whether or not enrollment has decreased in the last, you know, couple of years compared to 2019, for example. I don’t know if you have looked into this at all or have any thoughts about this. 

The Labor Markets Impact on University Enrollment

19:51 Michael: Yeah, that’s a really interesting point. I definitely can’t really. Speak very confidently, uh, at the graduate level, but especially because I’m teaching undergraduates right now, you know, the regional campus of a state school, I can definitely say, uh, that, you know, the University of Colorado system in particular is, uh. Definitely not experiencing the same type of enrollment surge that they saw after the 2008 crisis, especially at the undergraduate level, even campuses like ours here in Colorado Springs. I wouldn’t say, like, struggling with enrollment. But definitely having to ask some, some really difficult questions about what the future of, uh, right of enrollment is going to look like serving students best, helping them get the training they need for their future careers. But I think you’re exactly right that that those students are not feeling the same types of pressure and especially with the increase in wages that we. I would say that, you know, we at least saw in the 1st, few years after 2020, uh, the wage increases are sort of, uh, I would say, uh, leveling off now, partly because of the monetary policy response of the Federal Reserve and the increase in interest rates, which it was the goal, right? The goal was to sort of slow down that economic growth and see those wages, uh, not grow quite as fast. Um, but just the fact that wages were growing at all. After 2020 in the way that they were definitely presents people with a different set of opportunities. Um, and then I know this is something that you are very interested in and your podcast offers a lot of, uh, really important context, uh, around, but especially students that are looking at the trade offs between taking out debt to pay Right for their education, and then sort of considering that trade off in the context of what they can earn in the labor market. Uh, that’s becomes a little bit more difficult. Right of a choice. Um, and like you had said, if they can make the choice to put off right, getting additional credentials for a little bit, because of what they’re able to to do in their careers outside academia, uh, I definitely think that that set of choices is very different now for folks than it was in 2008, 2009, 2010.

21:57 Emily: I’m so curious and this is not a question for you, but I’m so curious to see how this new SAVE plan for federal student loans is going to impact people’s decision making around whether to enroll in school and how much debt to take out when there’s, um, you know, we’ve, we’ve eliminated with this repayment plan, the negative amortization that was so, so painful, um, for so many people on the back end of their degrees. And without that, I feel like the risk of taking out debt is much, much, much less now. Okay. The risk of the SAVE plan, we don’t know. Politically, we don’t know how long it’s gonna stick around for, but it’s, it’s here for the moment. So I’m just curious how people’s decisions are going to change around that.

Unionization Movements in the U.S.

22:33 Emily: But the next question for you, since we’ve started talking around, um, academia and versus the labor market and so forth. Um, I’m curious what your thoughts are around the unionization movements going around the U. S., around, that is to say, around graduate students, um, unionizing, and also how like stipend levels are, are being affected by this like strong labor market. I don’t know if you have any thoughts or data or speculation around that, just how academia itself and the graduate students going into academia and staying in academia are affected by these larger economic forces. 

23:09 Michael: Yeah, there’s so many, I mean, even just the way that you said that affected by the larger economic forces is such a great way of framing that issue because there’s so many different inputs, right? I think into, uh, the way that universities and the way that even departments are trying to figure out how they can do, uh, right by their graduate students, um, but also how they can attract, right? The best type of candidates that they, that they, uh, that they want. Um, I think that 1 of the ways that I think about this. Thanks. Of course, it’s just starting by thinking that graduate students on the whole experience of a lot of really specific vulnerabilities, right? Um, any type of event or situation that doesn’t conform to a more traditional sort of academic experience can also, like, really exacerbate those, um, coming into a, you know, a graduate program, something we both know. Well, there’s a lot of expectations, right? That are sort of carried over from. Decades and generations of the way that the graduate student experience is supposed to work. Specifically, right, like, figuring out how to live a decent life right on the graduate students stipend is who identified as kind of, like, the biggest thing that a lot of students have to face. Um, that includes trying to figure out how to pay rent, especially when, you know, rent inflation is out of control and most metro areas in the, in the U. S. including in places like Syracuse that traditionally speaking, right? Have had pretty depressed housing markets because of. Um, so. A lot of different dynamics of, uh, of, uh, economic vulnerability at the community level, right? That go back, you know, since the 1970s. Um, but as students are facing that, I think that that’s sort of combined with a lot of other, you know, sort of issues and concerns around equity and justice in general. Right seeing universities as being primary sites of contesting. A lot of those questions have really motivated a lot of graduate students to really participate in and unionization efforts to really try to not just have living wages, but also try to address other issues of fairness in the, in, in either their specific discipline or just in the, in the field more generally, um, you know, I can say from my own department, uh, we had a year’s long sort of unionization drive. Um, That kind of went in fits and starts and took a really kind of long pause and then I’m, I’m advanced enough of a student now to sort of be outside of the bargaining unit, but they just recently were able to, uh, to to to get that union recognized, uh, which is a huge achievement for them. And so at least still being part of the department and seeing how those conversations and negotiations are proceeding. You know, I already can look back and see how different that would have made my life right when I started in that program to know that there was a possibility of increasing the stipend on its own. But then a lot of other ancillary issues, right? Like. Uh, at what level is the department going to cover your health insurance premium? Uh, when I started in the department, uh, you know, I can’t remember now, but the percentage was really low, but even, you know, as as I became a more advanced graduate student, I could see that that was 1 of the ways the department was really trying to sort of reduce the, the cost right on students is by saying, well, if you are on a TA-ship, if you’re on an RA-ship, you know, we’re going to start covering that premium in full. Including in some cases for for other members of your family, which, you know, that’s a huge benefit that we identify with, like, a solid career job. Um, that maybe as a graduate student is kind of an afterthought. I guess also, of course, depending how old you are when you come into a program, um. But that makes a huge difference financially for folks, right? To not have to pay. You know, 1000, 2000 dollars and a yearly health insurance premium that, of course, you’re required to have. Uh, so unionization is just one of the ways, right? That graduate students can really sort of band together, right? Really use that solidarity with one another and with graduate students across universities. To really sort of fight for a situation that really helps them reduce their vulnerability, but then also build a good financial sort of basis as they go into their career in academia, which is kind of a separate conversation. But we know that the challenge is right to. To living a financially secure life as an academic, are extremely challenging. So if you sort of start right from a negative as a graduate student, it sets you up for a lot of problems down the road.

Commercial

27:35 Emily: Emily here for a brief interlude! Tax season is in full swing, and the best place to go for information tailored to you as a grad student, postdoc, or postbac, is PFforPhDs.com/tax/. From that page I have linked to all of my free tax resources, many of which I have updated for this tax year. On that page you will find podcast episodes, videos, and articles on all kinds of tax topics relevant to PhDs and PhDs-to-be. There are also opportunities to join the Personal Finance for PhDs mailing list to receive PDF summaries and spreadsheets that you can work with. Again, you can find all of these free resources linked from PFforPhDs.com/tax/. Now back to the interview.

Impact of State and National Politics on University Funding

28:27 Emily: I’m thinking now about. The comparatively strong labor market, surprisingly strong coming out of a crisis, um, perhaps competing with graduate school for talent, right? I’m thinking about the unionization movement, which is putting more pressure on universities to pay better wages and get better benefits and so forth. Um, but then more to your, I think, uh, research experience, I’m curious about the national and state level responses to these pressures, right? Because the funding for academia comes partly from the people participating in, like the tuition and so forth, but it also partly comes from the federal and state governments through grants and, and, uh, the state funding for public universities and so forth. And these, these pressures are, are coming against one another. And I feel in some sense, like graduate students and postdocs are the people, um, who get left behind. In these pressures, right? So can you talk about, like, sort of based on your research and how, um, you know, governments can intervene in crises, like what you see as potential, um, uh, pressure release in, in this, in this area? Uh, I hope that made sense to you. 

29:34 Michael: No, absolutely. No, and you’re so right. And, you know, again, there’s so many different levels that you can, you know, sort of analyze that on the one hand, you know, you sort of pointed to. The relationship between state level government and funding levels at state universities in particular, which affect stipends for graduate students and segments for postdocs directly the number of, you know, funding opportunities for graduate students to support their research, which helps reduce their time to degree, uh, you know, the number of services the university is able to offer, uh, to graduate students from, you know, um, Health, it’s not even just paying for health insurance premiums, but it’s just health services, you know, overall, um, going from that all the way to whether or not universities are able to provide child care support to students and to graduate students and even to faculty and other people who work at the university, you know, as you had said, like, all of that’s tied to the funding situation that the state university has. You know, and of course, that varies on a state by state basis, right? We see some states like the University of University of Wisconsin system. It’s really, really struggling with the sort of domestic politics of the of the state in general to to sort of figure out a funding model that really makes it to where they can support all of the good work that they’re doing across all their campuses. But Colorado struggles with that too, right? Trying to figure out how to really create a sustainable funding model for the state university system in the long term. So, that’s at 1 level that I really sort of see, as you had said, like, states being able to appropriately fund their state university systems. Interacts directly with graduate students and their sort of financial security and of course, like, how that impacts their, their long term career prospects. Um, but there’s also these other situations that really very also for graduate students to, um. That they’re existing, not only in a university community, but existing in a community that has all of these other dimensions, right? So the cost of housing, right? And a particular university community varies widely. And I think about this, even in a situation in Colorado, where you have the University of Colorado at Boulder, our sort of flagship research university is in one of the most you. If not the most right expensive, uh, sort of residential area on the front range and, uh, you know, I’ve never lived in Boulder, but I can’t imagine how challenging that is for the university to both attract graduate students and then for graduate students to figure out how to make the stipends that they’re receiving go as far as they can without having to choose to live 20, 30 minutes away right from from campus, which is. Not practical, right? Especially in the early years of your graduate student experience. Just even if we were to focus on, like, how much like, the cost of housing, right? Gets eaten up, uh, or eats up the sort of graduate student stipend. Um, that’s obviously something that universities can’t really do a ton about, right? That’s more of a role for, uh. For local governments or for state governments and can definitely see how the politics of that is really playing out in Colorado, an area where had a ton of influx of people since the pandemic that rent inflation is really, really high here. And we’re struggling, honestly, in a lot of ways to figure out how to how to control that.

Local Government and the Affordability and Availability of University Housing

32:38 Emily: I’m curious then, so I’ve noticed, um, there’s been struggles over, um, universities providing housing for, for undergraduates and graduate students, right? We’ve seen in, I can’t remember which UC is it, whether it’s Berkeley or another one, but um, struggles with local government in terms of permitting for additional, um, Student housing to be, uh, built. I know also at Vanderbilt, they opened up new, um, student housing a couple year or two ago, I think, and the students were very disappointed that the housing seemed closer to market rate and for a luxury apartment than like what was affordable for the students themselves. So the universities have some agency here, but they still have to play, as you said, with the local communities in terms of the permitting and everything. And, of course, the funding for those kinds of building projects. 

33:27 Michael: Yes, it’s interesting points, because you’re exactly right there, too, that, you know, the permitting issues, just the space, you know, sort of issues I think about different university communities that I’ve lived in between, you know, Syracuse. This is a completely different situation, right? Then, uh. As you had said, right, the, for, for Cal, like, in a city like Berkeley, or I lived briefly in Ithaca, you know, thinking about Cornell really struggling also with kind of figuring out where to even build right housing. If they, if they were able to for and making that available to graduate students and how the funding model works for that. So, that is a really great point. Maybe I, even in my sort of answer, letting universities off the hook a little bit too much. But in the same way, right there, like, you had said that there’s a lot of complex issues that. That they have to work with sort of the local community to figure out what is available to them. And I know that in Colorado, you know, this is relevant for us in the sense that we’re going through sort of a statewide conversation about permitting reform and there was, uh. You know, a bill that was passed by the Colorado state legislature to to really try to give local municipalities more power to change their zoning laws to build more affordable housing that ultimately was, uh. Was I believe vetoed by by by governor polis in part, because there was just so much opposition to it at the, the municipal level. So we’re going to try to sort of, I think, figure out how to proceed. But, uh, you know, we’re obviously not the only state that’s really struggling to sort of figure out the balance between Local control and state level control, uh, over, uh, zoning regulations, uh, to really try to incentivize, like, actually affordable housing or just more housing. Right? And, uh, so, yeah, lots of really complex layers there, but it has really, really, uh, serious impacts right on how graduate students figure out their, uh, their sort of budgets throughout their, uh, throughout their graduate student career.

35:17 Emily: And this is making me think about prospective graduate students, um, looking at, and I usually think about this actually, and this is not the full picture, right? I think about it as a snapshot in time. What’s the current cost of living in this particular city where I’m considering attending for my PhD, and what’s the stipend at this moment? But to be really comprehensive and fair, we have to look at the trends. Um, and whether, you know, states are struggling to, um, to really financially support the universities. And that means that the stipend raises not, might not be keeping up with inflation going forward. We need to look at housing and how that is trending and whether or not something like on campus housing is being provided or might be provided in the future. And just, I’m just thinking about a prospective graduate student, like, You know, for me, when I was applying to graduate school, like taking, you know, a day or two and visiting a campus where I might devote the next five, six, seven years of my life and, um, how much, uh, really should go into that decision on the financial side and how difficult it would be to collect all that information. for every single university you’re considering and really understand it. It’s such a, wow. It’s a really complex problem. 

Inflation and Financial Pressures During Graduate School

36:26 Michael: Yeah. You said it so well. And, uh, the time inconsistency situation is tough for graduate students because you’re exactly right. You’re coming in with sort of a quoted time to degree. You’re trying to plan your life out in that block. Um, and before you’re even talking about all the other changes that happen to you in your life, right. New relationships, you know, you have a kid. Other types of situations that happen to you and your family, you know, you live a whole lifetime really, especially at that age, right? Coming in and thinking about your 5 to 7 years before you’re finished. And then you have to make a decision about how you’re going to make the finances work. And you’re exactly right that. You know, the stipends don’t keep up and, you know, we are, we’re also living in a period where we have gotten used to, uh, cost of living inflation. Overall, not really being a huge pressure, right? Rent inflation. You know, the inflation of the cost of education cost of health care, you know, these things were always really difficult for for people that were early in their careers. But then you think about after the, the covid pandemic, and now we’re experiencing inflation on like a. A much more wide scale level, right? It’s like graduate students thinking about the cost of groceries going up, right? That’s not really something that if you went into graduate school in 2018, 2019, you really were thinking about. And, uh, I guess the only thing I’ll say for, for me is that this, I think highlights the importance, I think, of being able to really build that solidarity with other graduate students within a union. Because that’s where you really have the ability to to present that United front to your department of the university and say, look, these are the pressures, right? That we’re experiencing. This is the value that we’re offering to the department of the university through our work. And, uh, and we are going to work together, right? To come up with a solution that makes it to where we can have. A living wage, while we’re also sort of continuing to pursue our studies, um, and then linking that sort of struggle with other people in the economy. Right? I mean, these graduate students are joining, you know, the service employees in a national union. You know, some graduate programs are joining the United Auto Workers, right? I mean, they’re building solidarity. I think with other workers that are experiencing those same pressures. And it’s really inspiring. And I think it really is a really big part of the solution. I think at least from a graduate student perspective on getting to a point where can really make the finances, finances work. But your, your point about timing, I think it’s like, so it’s so true. Right. And so, so real on an individual level, especially. 

Shifting University Funding Models to Better Support Grad Students

38:45 Emily: I love your point about the, the power of the unionization movements and the unions that are already in place so much. I almost wish we could end the interview right there, but I have kind of like one more question, um, which is so with unions. You’re talking about advocacy at the very local level, and then of course we’re bridging to advocates and other, um, branches of that union. Uh, but I’m also thinking now about, you know, we just talked about funding from the state level. I’m also thinking about funding from the federal level, which in my field, like in the biomedical sciences, is what they do in academia, in graduate education, is so dependent on the National Institutes of Health and other federal agencies funding. And so I’m thinking about also, like, Okay, we want graduate students to be paid, not just a living wage, in my opinion, much more so they can do even more with their finances and actually have some financial security. More than the living wage. Also, other people in academia, you mentioned the pressures don’t end with graduate school. It extends into faculty and administrators as well. More funding is needed for the whole system. I think if we decide as a country and as a planet that we really value what’s going on in academia. Right? So I think the advocacy has to also be at the state and national level as well, um, to increase the budgets again, if we decide as a society that what we’re doing in academia is valuable. Because. If society does not decide to value it, then academia has to shrink because the pressures on these lowest levels, as I said, the financial pressures are just too much, too much to bear and you’re driving people away at this point. That’s how I see it. What do you think? 

40:14 Michael: Yeah. I couldn’t agree more. Um, I completely agree with you too, that it’s a national level question, right? And I think that this is at least from my perspective, one of the helpful insights that you get. From the political economy, sort of, you know, perspective coming within the political science discipline is that you see how these things interact with so many other things in our economy, right? Thinking about how we train people at the university level, what sort of skills we want them to have, who’s doing the training, right? Who’s gaining the skills to actually play that role of being those teachers. And that’s even before getting to the, to the other issues, you know, you know, a lot better than I do. I think coming in the biomedical field You know, who’s the ones who are investigating the types of advances that are going to help us solve the biggest issues that we’re facing, whether that has to do with, uh, you know, avoiding pandemics or responding to climate change or whatever it is. Right? And you’re exactly right that it’s a choice about whether or not we value that as a society and taking seriously what that looks like. And I think that both of us know quite well that, like, at the individual level, we’re not really just talking about having more access to funding for individual research, but that is a huge part of it. That empowers graduate students to be able to not only do their best work, but to be able to really focus on the work that motivates them. Right? Which gives them space for creativity for solving problems for asking questions. And it’s not to say that, like, you don’t gain a lot from teaching doing other research and that kind of stuff at the same time that you’re doing your own, but it is a lot of pressure. And a lot of the most successful, uh, you know, people emerging from graduate school are folks that didn’t really necessarily have to deal with those pressures in quite the same way. It’s 1 of the benefits of going right to 1 of the top programs is having access to more funding. And so you imagine what it would be like if. Everybody right going to graduate school has access to that same type of support, or at least. A lot more support and, uh, absolutely funding coming from the, you know, the National Science Foundation and other types of, uh, you know, federal sources of funding like that to really, really fund a wider range, right? Of research projects. And there’s also, you know, questions here related to what types of folks are getting, what types of funding and are we really supporting also marginalized voices in the academy that are really focusing on important questions, asking questions about. Yeah. You know, either the history, or the experience, or, uh, you know, of marginalized groups, uh, in our economy and in our society already. Right? Those are not necessarily the types of, uh, projects that get the. They’re the top choice for funding, um, because they’re more difficult questions to answer. So there’s, there’s a number of different benefits that we would experience at a societal level, um, from really embracing, uh, a university funding model That is actually oriented towards what we want to get out of universities, instead of just seeing them as sort of factories to train people with the skills to make them successful in the economy as important as that is. Right? 

43:05 Emily: I think about universities, both the product of a university that you just mentioned, people are the product, trained people, but also the research itself is a product. And graduate students do both of those things, right? They’re becoming those trained people and they’re also generating the research that is disseminated and helps on a much wider basis. But as you just said, if they can’t focus on the work that they’re there to do and then the skills they’re there to, um, to develop in themselves, like we’re really, we as academia, we’re really hamstringing ourselves by not supporting those trainees, um, financially and in other ways to the greatest extent they can so they can flourish. Um, I’ve been thinking recently about Maslow’s hierarchy of needs. So like at the top, like self actualization, like. That’s where we want academics to be operating. But if they don’t have the safety and the physiological needs levels met financially and again through other support systems, how, how can they be expected to be in that actual self actualization level, which is ostensibly what they’re there to do. Um, so it doesn’t really make a lot of sense, but as we have been talking about, there are so many different inputs to this system. That have to be, um, considered in the history of it. And gosh, well, I’ve enjoyed this conversation so much, Michael. Um, is there anything else that you would like to add at this point on How universities or state level or government or federal level governments could be better supporting their graduate students. 

44:31 Michael: I think that we have really covered, I think the wide range right of inputs. I really appreciate the conversation. I really appreciate your perspective and, uh, I think that you’re doing such great work. I think I’m trying to highlight how diverse right? This is the experience of, uh, financial life can be at the graduate student level. And, uh, Yeah, it’s just not really a story. I think that you think of immediately when you think of financial insecurity, but, of course, as we know, it’s, it’s, it’s a very, very pervasive feeling that a lot of us experience the graduate student level and it really resonates with me about how important the work that happens in universities is. Right? And I don’t even think that you really need to be overly romantic about it to think about the value those institutions have to public life and graduate students are a critical part of that. Uh, so I really have enjoyed this conversation and, uh, I don’t think I have anything additional to add.

Best Financial Advice for Another Early-Career PhD

45:24 Emily: Okay. Then we’ll just end with the final question that I ask all of my guests, which is what is your best financial advice for another early career PhD? We really haven’t gone in to that personal finance realm too much at all during this interview. So this is kind of your opportunity to enter that individual level and say what’s worked for you or what you think would work for other people at the graduate student level.

45:44 Michael: Yeah. I appreciate the time to sort of reflect, I think, on that, uh, on that question. And a lot of it is sort of connected to these key key elements that we’ve talked about so far in the conversation. I know that for me, 1 thing I didn’t think about enough about before I started was availability of funding, right? For my own research. And even looking at the availability of that funding, uh, what was it going to take to actually try to be competitive for it because of how limited it is, um, because it’s 1 of the key things, right? That we just were talking about this, but, like, relieving that pressure, um, of, uh, you needing to focus on the teaching and the work in order to make a living, right? To earn that stipend to sort of survive, um, the space then in your life gets shrunk, right? To focus on your own research, which it’s not even just about, like, you know, the, the personal fulfillment and self actualization as you were talking about, but it’s also about how long are you going to take to finish the degree? Right? I mean, I’m a graduate student. I’ll be candid about it. I mean, I’m, you know, in my 9th year, that’s definitely over the average sort of time to degree. A lot of that has to do with Trying to sort out sort of my own financial, you know, and my family’s financial situation at an individual level. I’m certainly not the only graduate student That’s tried to. To balance those 2 things with a limited availability of a funding to support me finishing my degree. So that’s something really just thinking about what types of opportunities are available to you and where you can get the best support for your own sort of research career if you have the choice, right? If you have the programs to choose from, if you have different types of opportunities available to you, just really thinking about that. And it’s hard when you’re just starting. Because you’re about classes, you’re thinking about where you’re gonna live. You’re thinking about, uh, you know, how you’re gonna read and pass your exams. It’s a lot of pressure, but taking some time to think about that earlier rather than later I think is really important. And then the last thing I’ll just end with to think resonates with the conversation we’ve had as a whole is trying to think about the various, you know, changes that are gonna happen to you in your life during that period of time. And how you can maybe try to anticipate some of them think about preparing, you know, for them, or just being mindful of how that might impact your financial situation. Uh, you know, changes in your in your family, right? Having, you know, a child, maybe experiencing a situation where you have to prioritize the care of a parent, um, these types of situations that can really come out of nowhere in life, you know, um, and I can say that Graduate students, I think are particularly vulnerable to these changes because the image of the graduate student is like a young person. That’s able to sort of stay up all night and eat ramen and read books. But that’s not every graduate students reality. Um, the onus is on you individually a lot of times, unfortunately, to really think about how to navigate that. And I know that for me, I think I wish I would have spent a little bit more time thinking about how my life was going to change over that period of time and how I could be better prepared for it.

48:51 Emily: That’s something I’ve definitely heard from other interviewees, um, something I also experienced to an extent while I was a graduate student. I mean, a PhD program is long. I took six years, you’re on nine now. Um, you can move through different life stages, as you said, during that period of time. And as we’ve been talking about, The economy can change underneath you. You can have a pandemic. If you started graduate school in 2018, 2019, you’re still in graduate school. Um, and so absolutely like as, as thinking of it as an individual decision, where am I going to go? How well are they going to support me there? You have to build in that. You’re going to need more support than you do at the moment, right? You can’t necessarily assume for five years, you’re going to be eating ramen and staying up all night, right? Your life is going to change and you, you have to think about those shocks. Um, but unfortunately Stipends being what they are, it’s very difficult to say, okay, I’m, I’m definitely going to go to the program that fits me best, the research interests, as well as supporting me above and beyond what my current needs and wants are, but factoring that into account, very, very, very difficult, but really, really good food for thought for anybody who is in that perspective stage.
49:56 Michael: Yeah, absolutely. Couldn’t agree more.

49:59 Emily: All right, Michael. Thank you so much for coming on the podcast. This has been a delight and I really appreciate you.

50:06 Michael: Thanks so much again, Emily. I really had a great time. Uh, really, really loved, I think, just being given the time to sort of reflect and think. about my own sort of financial life as a graduate student. And, uh, you’re doing such great work. And so I really love the opportunity to come on the podcast.

50:21 Emily: Thank you so much.

Outtro

50:28 Emily: Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by Dr. Lourdes Bobbio and show notes creation by Dr. Jill Hoffman.

This Grad Student Strives to Change Financial Policies at His University

October 9, 2023 by Jill Hoffman Leave a Comment

In this episode, Emily interviews Jason Anderson, a 5th-year PhD student in aeronautics and astronautics at Stanford University. Thanks to his work experience prior to grad school, Jason developed an unusual ability to read legalese and view every “no” as a starting point for negotiation. Both as a part of the Graduate Student Council and independently, he has advocated for changes to the benefits Stanford offers to its graduate students, particularly with respect to retirement accounts, health care options, transit, and income tax on fellowships. Emily and Jason have a lively conversation regarding the history and current status of these benefits at Stanford and at other universities, culminating in Jason’s advice to other grad student advocates and personal financial advice for all graduate students.

Links mentioned in the Episode

  • How to Not Hate Your Fellowship During Tax Season
  • Emily’s E-mail Address
  • Host a PF for PhDs Tax Seminar at Your Institution
  • Student Exception to FICA Tax, Treasury Decision 9167 (Example 8 on page 24)
  • Host a PF for PhDs Seminar at Your Institution
  • PF for PhDs S14E2: How This Grad Student Fellow Resolved an Expensive Tax Bill in His Favor
  • PF for PhDs Subscribe to Mailing List
  • PF for PhDs Podcast Hub
  • Jason’s Website
  • Jason’s LinkedIn
This Grad Student Strives to Change Financial Policies at His University

Teaser

00:00 Jason A: So they made some changes this year that I, hopefully will alleviate the problem. But, you know, this problem could have been alleviated years ago if they were listening to the students.

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, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others.

00:47 Emily: This is Season 16, Episode 3, and today my guest is Jason Anderson, a 5th-year PhD student in aeronautics and astronautics at Stanford University. Thanks to his work experience prior to grad school, Jason developed an unusual ability to read legalese and view every “no” as a starting point for negotiation. Both as a part of the Graduate Student Council and independently, he has advocated for changes to the benefits Stanford offers to its graduate students, particularly with respect to retirement accounts, health care options, transit, and income tax on fellowships. Jason and I have a lively conversation regarding the history and current status of these benefits at Stanford and at other universities, culminating in Jason’s advice to other grad student advocates and personal financial advice for all graduate students. You’ll hear in the second half of this interview that Jason and I dive into some of the issues regarding fellowship income and taxes, which as you know is one of my favorite subjects. By happenstance, we recorded this interview in late September 2023, and in early October, about a week before this episode publishes, I’m scheduled to give my new webinar, How to Not Hate Your Fellowship During Tax Season, for Stanford. I’m crossing my fingers that it really helps alleviate the stress of the grad students and postdocs and is received well, like it has been the other times I’ve given it.

02:18 Emily: If you’d like to bring that webinar in particular to your institution this fall or any of my pre-recorded tax workshops now or during tax season, just reach out! I would be happy to chat with you and give you more information that you can take to your graduate school or postdoc office to ask for this kind of support. You can reach me at [email protected] or read more about these offerings at PFforPhDs.com/tax-workshops/. You can find the show notes for this episode at PFforPhDs.com/s16e3/. Without further ado, here’s my interview with Jason Anderson.

Will You Please Introduce Yourself Further?

03:06 Emily: I’m so excited to have joining me on the podcast today, Jason Anderson. He is a fifth year Ph.D. student in Aeronautics and Astronautics at Stanford University. And Jason was actually connected to me by some of my contacts at Stanford who are hosting me for a webinar at the time of this recording. It’s coming up in a couple of weeks, and they told me that Jason is the person to talk to about some of the financial policy questions and concerns that the students may have. So that’s kind of going to be our topic for the podcast today. The advocacy work and the areas that Jason sees room for improvement in in terms of financial policies at Stanford and possibly at your institution as well. So, Jason, thank you so much for agreeing to come on the podcast. It’s a pleasure to talk with you here. And will you please tell us a little bit more about yourself?

03:49 Jason A: Sure thing. Thanks, Emily. It’s a pleasure to be here. And I’m really glad that I’m going to be able to share this knowledge. I’m really excited to help graduate students get get every everything they deserve. So as you said, I’m a fifth year aeronautics and astronautics student. My research pertains to augmenting GPS signals with cryptography in a way that is efficient and manageable. You know, GPS signals are have been around for a while, and cryptography requires a lot of data. So that’s what my research is about. And my hobbies would definitely be emailing administrators to get them to do things that the grad students need, you know, blow off steam. You know, that does come from some of my background working for and the legal field for a while writing those nice, crisp emails.

Connection Between Legal Experience and Advocacy

04:47 Emily: Let’s talk more about that experience that you had prior to starting graduate school. Yeah. So you were working in the legal field to some degree. Tell us about that experience.

04:59 Jason A: Yeah. So before Stanford, I went to UC Berkeley, go bears, and I needed to make a lot of money for my out of state education to be able to afford that. So, you know, I was a freshman engineer and applying to all these jobs to try and get myself an internship. So I, you know, I’d have have to have that income. You know, one of the checkboxes on one of those large websites was legal intern. And so the only job that returned to 19 year old Jason was that legal job. So it turned out to be a really interesting experience for me. I worked I worked there for between three or four years, actually, as a as a telecommute or working, you know, lots and lots and lots of hours and, you know, hours functioned as an executive assistant, which, you know, scheduling meetings, phone calls. But also my mentor allowed me to learn a lot about legal things. So I spent a lot of time reading agreements and reading laws, trying to trying to, I don’t know. So there’s this, you know, not to be cliche, but there’s this Sun Tzu person who wrote The Art of War. And, you know, his his main mantra was the art, the supreme art of war is to wage war without fighting. And so that’s like a big that was a big context for me. And the law of trying to use and take pieces together, strategy of trying to fix issues, using that. And then so that sort of prepared to me for a lot of the advocacy work today. And then after that experience, I worked at a different defense contractor and then came to Stanford. And so I have served as the in the student government here. I had no interest in student government in my undergrad. And it was not until I needed things that I became interested, like with regards to health care, retirement transit, a bunch of other benefits that I wanted I didn’t have. So I came to that quest to get them. And then, you know, so Stanford just voted to unionize and I am involved with that. So our union, as you know, is is undertaking a lot of these issues to help graduate students afford living. So here at Stanford, there are a lot of issues with affordability because, you know, Stanford is a very, very high cost area to live. So, you know, we have a lot of people going to the food pantry are especially partners with children, you name it. There’s a lot of work that needs to be done to make sure that that Stanford is affordable. So and that’s that’s part of what I’ve been working on in my as my hobby project, I suppose pretty serious hobby. But, you know, I still work full time as a graduate student.

08:07 Emily: Well, thank you so much for telling us about that experience. And we’ll get into talking about these specific benefits in a moment. But I just wondered if you could really explicitly make this connection between having this experience, being able to read legal documents and grappling with that kind of language and how you’ve been able to employ that past experience and that skill in asking for finding, advocating for the things that you and your peers need.

08:34 Jason A: Well, so I say that the first sort of thing that comes to mind is like the grit to even though when somebody says no to you, it’s not actually a no. So like, for instance, one of the items we’re going to talk about is retirement and when we get to there, we’ll talk about someone gave you a legal opinion that turned out to be false. And so, you know, when someone says says no to me, it’s it’s just not no. There’s still ways there’s still a way that you can you can talk. There’s a way to position yourself to respond back in such a way. Because, you know, Stanford or pretty much any school administrator is counting on you going away like. Right. So students are there in and out. And if you can just persist just a little bit, you know, you’ll be 100 times more successful. Ah, let’s see there are a lot of student government things that come to mind, like, you know, I got food trucks to come on to campus. That was a that was quite the ordeal. You know, for someone said, well, we can’t do this because these four different department departments need to approve, you know, like the infrastructure and then, you know, like, you know, parking, transit and then fire and then police and then, you know, these other things. And anyway, so the persistence that comes from being able to respond back, you know, when somebody says no, but also to read the documents because someone says no to me and I’m like, well, can you point to me the written rule of why somebody say, no, no, they they might not be able to point to a written rule. What they want you to do is they’re just so used to saying, Oh, I can just say no to this person and they won’t question. And then, you know, there are a couple of times where somebody says no to me. I ask them where in the rules it says that. And then they’re like, Oh, well, we reconsidered. So yeah. So being able to essentially mean where can I appeal. Right. If you know I do appeal, well then yeah. So

10:41 Emily: Yeah, it’s kind of appealing or negotiating and also like asking for your source. Like if you’re telling me there is a rule, okay, I’d like to take a look at it myself. Would you send me the link? Would you send me the document? I found the same thing that people have an impression of what rules are, and that’s actually not literally how it’s written or they’ve misinterpreted maybe what was written. And there’s another way to interpret it. Yeah.

11:05 Jason A: Everything’s sort of like a game of chicken when you’re trying to spar with someone. So their game with chicken is all the same. I just said no, they’ll go away. My game of chicken is I need the rule and they’re going to have to do the work to find the rule. And then they’re going to they’re going to realize, I don’t want to do that anymore. And it’s easier just to let me get what I want. So anyway.

11:26 Emily: I like what you said, though, about, like, oftentimes administrators. I mean, I don’t like to ascribe ill will to people. That’s not very, very, very obvious that that’s what’s going on. But a lot of times people are just overloaded and it’s easier to say no or just dismiss you or whatever, because it would create more work for them. But if it’s really important to you and important to your peers, then you should both try to come to a solution together. That’s mutually appealing.

11:53 Jason A: It helps I don’t take things personally on these types of issues. You know, I am I’m not someone who takes things personally, so it’s cold water on a duck’s back to me. But I can still write that emails to respond back. But yeah,

Retirement Negotiations

12:06 Emily: All right. Well, let’s get into these enticing areas of negotiation and pushback that we talked about before. So I want to hear about your kind of personal experiences working with or against or whatever the Stanford administration in these these four areas. Okay. We’re going to talk about retirement, going to talk about health care, transit and then income tax withholding, estimated tax. So let’s start up at the top with retirement. Can you give me a summary of what’s going on right now and what you have tried to ask for, what you’ve tried to advocate for?

12:39 Jason A: Well, so I have the privilege of having some extra income. You know, not everybody at Stanford has that. But one of my goals is to save 15% of my income. If you start early, this is what Fidelity says it’s only 15%. But a Roth IRA isn’t sufficient for that. And, you know, I think retirement is more like a public health issue. So in that you should have it deducted and not think about it, because if it’s not there, then people aren’t going to do it. So that’s why I think the employer deduction is really important.

13:12 Emily: That’s why people are moving to opt in system or rather opt out systems rather than opt in systems that are normal type of workplace.

13:19 Jason A: Yes. And then also my first year, I needed to borrow for my retirement from my company because I was in a cashflow pinch for about three months. And I was able to do that because I was still employed. I was simultaneously employed. If I didn’t if I weren’t simultaneously employed and I would have you know, you have all these graduate students who are super cash for. But you know something? A lot of them work between undergrad and graduate. So, you know, if Stanford provided this retirement benefit, then, you know, a lot of things happen. You know, you can do that public health savings, you can borrow from it. And, you know, and the benefit is very cheap. So, for instance, another company I work for, I know that the price per person participant is about $4 per month. And that’s actually a very expensive plan. So what my my knowledge is, is that I know this is very cheap and it’s extremely beneficial. I mean, it’s essentially helping grad students avoid taxes from the federal government. Right. Or avoiding shark loans.

14:21 Emily: Absolutely. And furthermore, I mean, Stanford and every university already operates a 403(b) plan at a minimum. And that’s the plan we’re talking about here for the listener. We’re talking about expanding access to the 403(b) plan that the university already has for its employees and faculty and everybody to the graduate students who are also employees. Correct?

14:42 Jason A: Yeah. Yeah, that’s exactly right. 401- 403(b) for for my institution because I guess we’re we’re exempt from income tax. But yeah.

14:53 Emily: Yeah. And so you’re saying, yeah, just what you said. Like if a student came in, let’s say they had a 401K or a 403B at a prior employer and they were able to roll it into Stanford’s 403B plan and they’re currently an employee at Stanford then like you did, they would be able to take a loan or while withdrawal could happen either way, but a loan against the four oh three B and then be able to pay it back gradually over time to alleviate the cash flow crisis. As you said, that is so common, especially the start of graduate school, very, very expensive transition. Generally speaking, they’re not helping you at all or very much so. Absolutely. That makes sense. And as you said, to continue the, I think it’s partially like a mindset thing, like because four oh three B’s are not typically offered to graduate students. It’s like not it’s not on their mind. It’s like an out of sight, out of mind thing about saving for retirement. And as you said, if possible, saving something like, you know, a few percentage is fine, but up to 15% would be an amazing goal to be able to accomplish during graduate school. And without the employer support on that, it’s easy to put it on the back burner. It takes a lot more initiative to open up an IRA, you know, separately from what’s going on at work.

15:59 Jason A: Yeah. The only reason why I was on my mind is because while I’m out of Berkeley does this. All right? Right. And so, you know, there are institutions out there that do do this. So

16:09 Emily: Okay. And so what communications did you have with the administration regarding the 403B?

16:14 Jason A: So, you know, student government is its own own thing. And, you know, so on the docket list of priorities, retirement is at the bottom one. Okay, because there’s far more important issues. Okay. But it also costs the employer nothing. Postdocs already have this. Okay. So this is like at the bottom of the list. You know, we’re hoping that they’ll give us the crumbs or whatever. Right. So when I pursued this avenue of advocacy several years ago and the response was, well, so if we give you this plan, then you’ll lose your FICA tax exemption. So just for your readers, graduate students and students in general do not have to pay FICA taxes and which is seven and a half percent off if your paycheck for Social Security and Medicare. So it’s like, Oh, wow, Well, we wouldn’t want to give up seven and a half percent of our paycheck. So I can I can have the option of putting 1% away. Right. Well, so you know that that’s where the legal experience comes in. I’m like, well, they said no for a very good reason to me. And so I go through and read the IRS law and I look up, I see I pull up the document just in case, you know, document number 9167, And on page 24, the IRS provides a comically helpful example that explicitly explains that graduate students can participate in the form of 403B plan and not be FICA exempt. And this is like so you know that tenacity I’m talking about. Well, I read that document from page one through page 30, right? It takes a lot of gumption, I think is to read through really boring topics like this. And it turned out to be helpful. So then as a student government, I got some pro-bono advice from a retirement lawyer. After I wrote my own opinion, I had the lawyer look over it and then I sent back this demand letter that says What you said is not true. And no, and we should be able to get this. And then so then after that, they’re like, Oh, well, nobody would use it. And, you know, the survey data that I have by most, my constituents shows that that’s not the case. People would in fact use it. But, you know, you know, I’m hoping that different organization, hopefully our union will be able to win that. But, you know, there’s a lot of other priorities, too.

18:30 Emily: Okay. So that’s the current status of you think you’re in you’re in the right here, at least their excuse number one was not a valid excuse. I haven’t looked at this myself. It’s very interesting to me. I’ll have to check this out after the end of the podcast interview. And that’s where it stands right now. You’ve knocked down their argument, but no further progress.

18:49 Jason A: Yeah. I mean, I think food insecurity and affordable housing and health care are much more important issues. But, you know, two years ago when I was working on this, I was, you know, you know, Thursday evening, I’m like, we’re doing my research and I’m like, oh, thank you, IRS they like, I’ll give you an example. Like, student J, is this No, they are exempt from FICA, which is I think it was kind of comical, but yeah, they didn’t do their homework or they were they’re lying to me to give me a go away. I mean, who knows? You know, I want to give them the benefit of the doubt, but at the same time I think it’s clear and Berkeley and other universities are able to do it.

19:31 Emily: Mm hmm. Yeah, I mean, I agree in terms of, like, basic needs, you know, paying people enough that they don’t have to access food pantries and be housing insecure and all these things very important. But there’s also like the optics on, hey, like let’s treat grad students like they’re real employees and give them real benefits that other people have in other places. It’s quite standard. So there’s that aspect of it as well. But thank you for filling us in about that, because I am quite sure that many, many grad students around the country would also like to use their universities for 403Bs and you know, maybe they can get a little budge on this like you have so far not been able to, but good efforts to move on to the second topic of health, health care, health insurance.

Health Insurance Negotiations

20:13 Jason A: Yeah. So Stanford you know your readers can Google Stanford Bill on affordability and I, I wrote with my colleagues in the graduate Student Council 10 page actually explaining why Stanford is not very affordable. But one of those things is health care. We have the most expensive health care plan that I can find. And then one of the things that is expensive about it is that Stanford students, rain or shine, I have to pay $1,000 per year for their primary health care. I do think that other universities have similar fees, but they’re covered by their tuition. So I do have family who are health care administrators, and I’ve  participated in health care advisory boards. So it’s typical for an employee, an employer, a large organization to have advisors on benefits. Stanford faculty have this, Berkeley students have this. We’re still working on Stanford students, but essentially the students come together and they advise on what benefits should they should they have like, oh, graduate students need wisdom teeth surgery because we’re young or prescription eyeglasses would be nice at Stanford they’re not covered, you know, things like that. And it doesn’t necessarily have to be cost positive or neutral. The point is, is that people should have a say because they pay into the plan. And the administrators, I think, don’t have the best knowledge. The students have the best knowledge. So that’s something I’ve been fighting for for more than two years. I mean, retirement is probably the interesting thing about the taxes and whatever. But, you know, you know, you know, we’re that’s the thing I’ve been working on for a long time. So, like, for instance, Stanford recently changed and they passed just a smidge on allowing student advice on that topic. But they retracted actually. So we’re we’re still fighting for back. But essentially, you know, the advice that I was able to talk about is, you know, students want an app to use their health care because last year, in order to get claims processed, you had to mail in the claims and pulling your hair out like, I don’t know, maybe your readers have an app for their health care, right? So I had to help. I had an app for my parents when I was on my parents insurance. And then and then. Furthermore, the plan is a very high level plan which sort of prices out. Most everybody, only people on the plan have it subsidized. So, you know, the professional students are really hurting right now because they might be over the age of 26 and their only health care options are Obamacare or Medi-Cal or this plan that Stanford offers. So I’m really, that’s something that we’ve been asking for. And, you know, I think we’re going to get it with the with the union. But, you know, I wish that Stanford was as good as Berkeley, so I’m wearing my Stanford shirt. But, you know, Berkeley has been doing this for years. I wish Stanford would catch up on this on this regard.

23:11 Emily: Well, it’s good to have a nearby, you know, peer type institution to compare to and say what are the best practices that we can take from over there and share back and forth? I think in our prior conversation, you mentioned to me that the annual premium, if I remember correctly, for like a like a single person enrolled on the health insurance plan was like $7,000, is that right?

23:33 Jason A: Yeah. So the aggregate expenses are a 68 plus 1000. So I think about 77 to 7800. And if you have a student partner with a child, the premiums are 12 grand a year. At least 12 grand last year might be 13 this year. So and so to me. So, you know, there’s been issues with the plan because it’s in low participants and they’re apparently in a spiral out of control. And, you know, you wonder why it’s so, so, so expensive that nobody can afford to use it. So, yeah, to me, that price is like, please go away. That’s what the premium says, Please go away. So and then especially to our Stanford International students who bring partners and children and they have visa restrictions preventing them from getting other jobs, you know, those are the people who are at the food pantry every month because they are doing their best in such an unconscionable circumstances.

24:40 Emily: I can confirm when you said that number to me in our previous call that really raised a red flag for me, that that was very high compared to what I hear at other institutions. I want to say. I mean, I was in grad school some number of years ago, but I want to say it was like 2 to $3000 for the year for the premium for one person. So, yeah, a very different price level between those two. So that’s interesting that you. Okay, so you’re saying there it’s an under enrolled plan because the price is so high, which causes the price to go higher. So it’s like in sort of a death spiral. But the competition, let’s say, okay, if you’re a student, you can enroll in this plan. If you’re still under age 26, maybe you can enroll in your parent’s plan or maybe have a spouse. You know, there’s other places people can go, but then that last resort is like the ACA exchange rate versus the Stanford plan.

25:26 Jason A: Yeah, what’s sad about that is you lose a bunch of tax subsidies, right, because that’s why your employer pays for your health care. You know, and there are some tax subsidies. You know, I haven’t done my research into it, but I mean, it’s a very it’s it’s really structured that your employer should pay for this. And also the plan here is for the facilities nearby. If you go ACA, you know, who knows where you where you’re going to be and especially those international students who are coming into this health care system and don’t know what is going on. But yeah, yeah. And part of the reason why the plan is so expensive is because all all Stanford, pretty much all the health care, you have to go to the hospital. And Stanford also is a nice hospital, but it’s impacted. So like I tried to get an appointment nine month waiting time for myself, you know, So they made some changes this year that I hopefully will alleviate the problem. But, you know, this problem could have been alleviated years ago if if they’re listening to the students. So yeah. And also say a lot of this is my opinion. So take that with every grain of salt.

26:37 Emily: Absolutely. Okay. So the idea here is to get a committee, a student group that advises on the health care plan. And right now you’re voicing a main concern is it’s very expensive and it’s driving people away.

26:51 Jason A: Yeah. And I’m not the only voice. I mean, people talk about the mental health issues. There’s the minority disparities in health care that, you know, my family members talk about that I think are insane. You know, this is the type of feedback that needs to come in. And I think the best way to resolve it is to have everybody speak their own voice. And I just I’m just one voice. That’s why it needs to be a committee

27:13 Emily: Okay. Well, thank you so much for bringing that up.

Commercial

27:15 Emily: Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, frugality, increasing income, or student loans, each tailored specifically for graduate students and postdocs? I offer seminars and workshops on these topics and more in a variety of formats, and I’m now booking for the 2023-2024 academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, or postdoc office? My seminars are usually slated as professional development or personal wellness. Ask the potential host to go to PFforPhDs.com/speaking/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

Transit Negotiations

28:35 Emily: Third on our list is transit. Tell us what you’ve been doing on that front.

28:40 Jason A: Stanford took away free transit benefits and May June and people are very angry about that. So I’m

28:49 Emily: Are we talking about on Stanford’s campus like busses? Are we talking about trains or what level of transit?

28:55 Jason A: Trains, yeah so rent is very, very expensive in Palo Alto. I don’t know if you’ve heard of so there’s a train that was very convenient that Stanford used to use, used to purchase the monthly pass for, and so I’d like to see that returned. Furthermore, I like on the subject of retirement benefits, costing them nothing. Every employee at Stanford has access to purchase those tickets pretax, which is an effective 30% discount to Stanford students. Right. So and yet another payroll benefit that costs them almost nothing that they can extend so that their employees get thousands of dollars every day. So I would say that that is the transit element that I would like to see happen.

29:40 Emily: Plus the environmental benefits of incentivizing, using public transit over other forms of transportation.

29:47 Jason A: Absolutely. As part of, you know, the Stanford just inaugurated a new school called the Doerr School of Sustainability. So yes, I totally agree with those arguments, although I am a little bit focused on the taxes because I’m a little bit biased on. Yeah.

Income Tax Withholding Negotiations

30:03 Emily: Great. All right. Fourth topic and one of my favorites, the lack of income tax withholding on paychecks for non employees who are U.S. citizens and residents of for tax purposes. And for that group, the possible requirement to pay estimated tax. So this is the issue that you and I first got connected over. So, yeah, I’d love to hear what you’ve been talking about on that front with the administration.

30:29 Jason A: You know, Stanford is an educational institution and I think it is on them to educate their students on their taxes. So one of the things I’ve been working with, graduation council, are these tax office hours. Well, where the government, the student government will purchase the CPAs time and will, you know, explain how to, how to do this. Students really don’t know. You know, I was fortunate enough to grow up in a high school district that literally made every single 18 year olds in your file taxes by hand and like a dummy scenario. So like I you know, you can go to the post office and get your tax forms. I didn’t know that. Right. So I came in knowing every single dollar that I earned, I have to pay tax. A lot of people don’t know that. So at the office hours, you have a wide breadth, you have your international student who’s dealing with tax treaties and all sorts of stuff, and then your domestic student who is this is their first time in their entire life that they’ve earned income and it’s a fellowship and they don’t get their W-2. It’s not you know, TurboTax can’t handle it. And, you know, TurboTax and professionals will get the advice wrong on certain aspects. So one of the things that I was fortunate enough to get Stanford to do is to take a stance on health care fees, the taxability of health care subsidies on fees. So a lot of students at Stanford, which is really why I’m excited to talk to you today, are are falsely paying taxes on their health insurance stipend. So they they get charged at Stanford $7800 a year and some people that’s partially subsidized and then it’s reported funk funky on the 1088 and 1098 is not an income tax. It’s just a it’s just a education benefits, deductions and credits right and graduations aren’t taking those deductions and credits. It’s really the wrong form for them. So you know stand for housing affordability issue. But, you know, I’m so glad that Stanford talked to you. I mean, the reason why they’re hiring you for this is I’m hoping, you know, so we can save graduates from $3,000 of taxes a year. Right. We have an affordability crisis where people are going to the food pantry every month with their wagons and children. This is $3,000 that they don’t have to be paying. Right. And so, you know, when I was student government and I had this from government to government is paying a CPA like $500 for their time. Right. And then you’ve got 100 people coming in and they’re overfull and each one of them is is saving thousands of dollars. Right. This is like the, you know, retirement, transit. But this tax stuff is probably the easiest way that Stanford can take initiative and stop all of this. You know, years ago when I was starting my advocacy on this, a Stanford person told me that that the interest and penalties that students pay every every April as part of their tuition rate, as part of their tuition, they don’t know. They come in. They they don’t know they need to make estimated payments. And then they get you know, they get those fees. That’s their tuition. It just made me so angry that they that they could send an email to everybody today. But this is an example of tenacity where Stanford’s like, it’s not my problem. I don’t want to be liable. What not. Right. But that’s not true. Okay. They they can say this is what a typical student does. You know, my high school in Marietta, Georgia, explained to us how to file taxes in a theoretical scenario. Stanford can do it, too. So, you know, I’m really glad that you’re coming on, you know, a couple of weeks to talk about that. So that’s the end of my long rant. But I could go on.

34:16 Emily: Absolutely. I mean, you hit on several different issues in there, which I think are incredibly important. So let’s start with that. Okay. $7800 in what I in my framework, it’s called awarded income. So it’s fellowship scholarship type income, not reported on W-2. That’s what I call awarded income. And as you were saying earlier, awarded income. Like you have to assume it’s taxable right from the outset. You have to assume that as part of your taxable income, unless you can prove that it went towards paying a qualified education expense and then it gets to be tax free. So the argument here is that whether or not health insurance premium paid, you know, for university health insurance for a student is considered a qualified education expense. And in my opinion, the opinion of the CPA hired to, you know, work with me on this. It is under limited circumstances where it’s required of the student and the student is purchasing it through the university. And that means that that premium or that means that the amount of money that goes towards paying the premium gets to be tax free because you all have such a high number on that. That 7800 really makes a big difference to you all, especially it’s going to be a lesser effect at other other institutions, but still in effect. And so it is an important thing to know that if you receive a 1098-T, that amount of that premium is not going to appear in box one as a as an education expense because it’s not a qualified education expense for the other benefits. As you were saying earlier, the Form 1098T is not designed for the tax free scholarships and fellowships benefits. It’s designed for the lifetime learning credit. It’s designed for the American Opportunity Tax Credit. But that’s not the one grad students are taking. They’re taking tax free scholarships and fellowships. So anyway, the 1098T is like, okay, as far as it goes, but you have to have this inside knowledge that it’s not a complete document. It doesn’t actually list all your qualified education expenses. And that’s a real disconnect. People think they receive a form and it’s kind of trustworthy and it’s really not. You have to double check everything on it to make sure that it’s complete and accurate for your situation. Oh, I’m going on my rant now too.

36:11 Jason A: Yeah, well this is why it’s really important to read those really dull IRS instructions after having three and a half years of legal experience. And you view me the legal brains like, well, health care is disallowed in sections two and three for undergrads, but it’s not disallowed in section one for graduate students. And then you’ve got a CPA. So like I’m in office hours, I’m literally arguing with someone who is has their own tax advice over the phone. And I’m like arguing with the professional over this because they’re wrong, because professionals get this wrong. And this is why Stanford needs to step up and take a stance here, because that’s a lot of money here. And anyway, it also kind of points to how our government should function because it shouldn’t require years of legal experience to be able to navigate our tax code. 

37:02 Emily: I totally agree. It’s interesting that you and I have kind of come to this in a similar way of just like I just I just read the thing like, I just sat down and read it, like, completely. And once you do that a few times over a few years, like you kind of get used to the language and it’s not so intimidating. And you can make those connections like, Oh, the definition of qualified education expense is different depending on which benefit you’re talking about. Oh, the definition of earned income is different depending on which tax benefit you’re talking about, but you only pick up on that after, you know, exposure. And as you’re saying, it doesn’t it’s very hard to find, I mean, this is the experience my client is. But if you work with me, it’s because they can’t find a CPA who’s versed in this because it doesn’t pay. This is not their typical client base. And so you either have to find a CPA and really educate them or somehow find a magical unicorn, which I have not found who is like already well versed in this. But anyway, that’s why people end up working with me, because while I’m not a CPA, but I have read this and I’ve really tried over years, including professional consultations to understand what’s going on, and now I can communicate that

38:04 Jason A: Yeah, I mean, humans were never meant to read all IRS instructions document, so I don’t really want to fault them for it, but that’s just the world we live in. So.

38:16 Emily: It’s tough, especially because even many tax preparers, CPAs included end up relying on software to prepare the returns, and they’re not necessarily deeply analyzing what goes in and what comes out of that software. And if the software, as you said earlier, like TurboTax, is not designed to handle, like you can do it if you know the tricks, but it’s not intuitively designed to handle this income. And so if the software is letting you down, but you don’t even know enough to know that it’s letting you down, it’s a really, really tough area. Oh, I’m getting fired up about this, too. I’m like, I need to create a software solution. Okay. Anything else you want to say about this topic of estimated tax or the reporting or the taxability of like this fellowship type income?

38:55 Jason A: You know, I just want to add like my one sentence obstruction, which is what I do is I go to this website called Smart Asset. I put in my expected income. I ignore the FICA taxes and I look at the federal income and state income, and I take that number divide by four. And that’s what you need to be paying every quarter. And if you forget, you’re going to be splashed with interest and with interest and penalties. Interest rates high now. So if you get a fellowship, you owe money. Even if they don’t tell you

39:29 Emily: Exactly. And that’s the same website that I recommend when I teach this as well for like, okay, honestly, the best best thing to do is to fill out the estimated tax worksheet in form 1040-ES. Yes, but a lot of people don’t do that. I understand. So that calculator is a really good like substitute. You may be paying more than the bare minimum you’re required to, but that’s okay. Like if you accidentally overpay a little bit, you’ll get a refund at the end of the year. And it’s a quick way to get some peace of mind that you’re like, you’re on top of this issue. You’re not going to be fined at the end of the year, most likely. So yeah, I really like that suggestion. And the other thing that I’ll mention, just throw in there for potential future advocacy on on your front is that the university that I went to, Duke, they did withhold income tax on fellowship, paychecks and fellowship stipends. I’ve only heard of a couple of institutions that do that. It’s very, very, very rare. But it happened to be that the one that I attended did that and it causes other complications with reporting. So it’s not an easy, easy solution. But they did it somehow.

40:26 Jason A: Stanford told me that they can’t withhold and now you say that that that’s not true.

40:32 Emily: No, it’s not true.

40:32 Jason A: They don’t have to. But you know just, another reason why it’s not my problem go away administrator, but. Yeah, I mean I talked to them about this and I totally, I it might not be the best solution but I think it’s better. People have their rent deducted. You know in the tax office hours, they’re like, my, I have this deduction why wasn’t taxes put in there. I’m like well your rent deduction didn’t include a tax deduction. So, anyway.

41:01 Emily: Yeah, it’s definitely not impossible. But as I said, it’s very, very rare. What ended up happening in my case is that the income then was reported on a 1099 Miscellaneous. So they basically so they had a box for your amount of income and they had a box for your amount of withholding. They had to use a form that did that because the 1098T doesn’t have a box for how much income was withheld from it. Now compared to back when I was in graduate school, there are 2 1099 options that sometimes gets used for fellowship income. One is the 1099 MISC and one is the 1099 NEC, I’m not sure which Duke is currently using, but I’ve noticed that some funding agencies end up putting fellowship income on a 1099 NEC, which brings up a whole other issue, which is people confusing their fellowship income with self-employment income, which shouldn’t happen and just PSA to anyone who’s listening to this, like do not allow that to happen on your tax return because the fellowship was not self-employment income, in my opinion.

41:50 Emily: Okay. 

41:51 Jason A: It’s very expensive mistake. 

41:53 Emily: Incredibly, I mean.

41:53 Jason A: Very expensive mistake, yeah.

41:55 Emily: You mentioned the 7.65% for your FICA tax it’s double that right for self-employment tax. So huge, huge issue to get into and actually I’ll reference in the show notes an earlier podcast episode I did with someone who went down that mistake route and had to correct it with the IRS. Okay. So among these four areas that you’ve been working on, along with student government and some other people, are there any like big takeaways or lessons that you can convey to the listener about like best practices around doing this advocacy around financially related policies on campus?

Best Practices for Financial Policy Advocacy in Higher Education

42:24 Jason A: I you know, again, tenacity to read the documents. You know, I think we’ve gone through three examples where a Stanford administrator says the wrong thing because there’s just not there probably want to go away but IRS instructions twice and then know. Yeah so like you know on our outline here about how to negotiate for better benefits, the first step is to ask and when they say no, do your homework with with the documents. And you know, I consulted that retirement lawyer and graciously gave me that advice to confirm what I had read in the documents. So, you know, student governments can engage lawyers, unions can engage lawyers, you know, get your own advice and stick them with the letter that says, no, what you said was false. Oh, and then get it in writing too writing is really important because. Yeah. 

Best Financial Advice for Another Early-Career PhD

43:22 Emily: Absolutely. Well, thank you so much for that. That advice, that suggestion, that route to go down. Let’s end with the question I ask all my interviewees, which is what is your best financial advice for another graduate student or another early career path? Ph.D. And it could be something that we’ve touched on already in the interview, or it could be something completely new.

43:40 Jason A: So. Okay, maybe this might be this, this might make you chuckle a little bit. So what I do when I file my taxes is I use, I do it redundantly with two softwares and then I submit it with the free one. I make sure the numbers match and it’s actually debugging that is how I’ve really learned the tax code of of all this. So and then so don’t pay money to the to corporations that lobby for our taxes to be complicated. So I will not do that. But anyway so that’s that’s the first piece of advice.

44:14 Emily: I want to make a small comment on that because I love that suggestion A lot of people don’t know. So I’ll mention TurboTax just because I’m more familiar with the software. A lot of people just, you know, input their numbers and then the the return is generated and filed. But there’s a step before that where you can preview your return. So you preview the 1040 and any other forms that have been generated through that process. And that’s what you can compare apples to apples with another software. You also preview the 1040 over there. You get a nice PDF or whatever, and there you can compare line by line to make sure everything matches or see what the discrepancies are. So you don’t just have to blindly submit whatever forms this software is generating. You can actually look at the final form before it’s submitted.

44:55 Jason A: Yeah, and, you know, TurboTax has like the automatic import. So it’s not necessarily that you’re entering it twice. It can be a just a double check

45:04 Emily: Very good. Well, I love that suggestion. Also for me, filing my tax returns manually, like literally by hand or through the free fillable form system was a great education. And I’m very I don’t know. Is the IRS still on track for their own software coming out for upcoming tax season? I know I’m excited too. Okay what was your second suggestion

45:26 Jason A: You know, so there’s this Reddit financial or personal finance page with the flowchart on what to do. I would Google that and follow the flow chart. And then one of those things after you’ve done emergency savings is, you know, Roth IRAs can be a vehicle for your emergency savings under certain circumstances because Roth IRAs, you can pull out the contributions, you can put your emergency savings in cash and a Roth IRA or Treasury bills if you if you want to do that, low risk. And then, you know, if you have the emergency, you have the emergency. But if you don’t have the emergency and five years at six grand, you know, then you’ll have $30,000 in your retirement and your Roth IRA when you end, and then you’ll go straight into that high income job will not be eligible. So, you know, if you can, I would put your savings in cash in a Roth IRA until you have enough cash to start investing it. But.

46:25 Emily: This is an advanced technique. It’s not one that I recommend because I think it’s difficult to do that. The qualifier that you mentioned is keep it in cash or keep it in a very no risk investment inside the Roth IRA. That’s what I think is difficult and where people might not complete this whole process correctly, because it is to me very important that you not take any risk with your emergency fund. But yes, you can still keep it inside the Roth IRA. I love your point of like use that eligibility to contribute to the Roth IRA when you have it, because it may not be around forever once you get to those higher paying jobs. So good suggestion, but I want them to listen to your whole suggestion.

47:01 Jason A: Yeah, it’s all about the audience here. You know, a Stanford PhD student, you know, you’ll find people who are ready to do that advanced topic. I mean, graduate students but yes, you’re right. Totally right about that.

47:14 Emily: Well, Jason, I’m so excited that you agreed to come on the podcast. This is a wonderful interview. I hope our listeners will take some of what we talked about today and go back to their own institutions and start advocating for some of these same issues or using some of the methods that you mentioned. And I especially love your tip about basically perseverance, both in reading the documents and doing your homework and also with your communications, because you’re going to get told no. And like you said, just it’s not personal. Let it roll off your back. Come back. You know, do your homework, etc. So this is really, really valuable, I think. Thank you so much.

47:42 Jason A: It’s been my pleasure. Thank you for reaching out. And I want to say good luck to all of your listeners in their their financial pursuits and advocacy and good luck to SGWU you as well, because we’re going to we’re going to fight like hell to get to get all the things we deserve.

Outtro

48:04 Emily: Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by Dr. Lourdes Bobbio and show notes creation by Dr. Jill Hoffman.

This PhD-Prepared Nurse Managed a Night Shift Side Hustle Despite It Being Frowned Upon

September 25, 2023 by Jill Hoffman Leave a Comment

In this episode, Emily interviews Dr. Jacqueline Nikpour, who holds a PhD in nursing from Duke University and is currently a postdoc at the University of Pennsylvania. Jackie side hustled with occasional nursing per diem jobs to supplement her stipend during grad school, but her side job also conferred unexpected benefits to her dissertation and career progression overall. Jackie details how she managed her schedule to fit in her research and writing, night shift job, and personal life. Jackie and Emily also discuss how finances are a barrier for many people to even pursue a PhD, how one-size-fits-all prohibitions against side hustling hurts the PhD workforce, and how Jackie advocates for the grad students she works with now.

Links mentioned in the Episode

  • AMA on the PhD Home-Buying Process (Free Live Q&A)
  • Host a PF for PhDs Seminar at Your Institution
  • Emily’s E-mail Address
  • PF for PhDs Subscribe to Mailing List
  • PF for PhDs Podcast Hub
  • Dr. Jacqueline Nikpour’s Twitter
PhD-Prepared Nurse Managed a Night Shift Side Hustle Despite It Being Frowned Upon

Teaser

00:00 Jackie N: You don’t just exist in academia as a, as a person and have nothing outside of it. Like we are fully complex, complicated, messy humans. And we sort of are the total package that we are. And so I think just creating a little bit more flexibility in place because every student, every discipline is so vastly different.

Introduction

00:28 Emily: Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. I’m your host, Dr. Emily Roberts, a financial educator specializing in early-career PhDs and founder of Personal Finance for PhDs. This podcast is for PhDs and PhDs-to-be who want to explore the hidden curriculum of finances to learn the best practices for money management, career advancement, and advocacy for yourself and others.

00:58 Emily: This is Season 16, Episode 2, and today my guest is Dr. Jacqueline Nikpour, who holds a PhD in nursing from Duke University and is currently a postdoc at the University of Pennsylvania. Jackie side hustled with occasional nursing per diem jobs to supplement her stipend during grad school, but her side job also conferred unexpected benefits to her dissertation and career progression overall. Jackie details how she managed her schedule to fit in her research and writing, night shift job, and personal life. Jackie and I also discuss how finances are a barrier for many people to even pursue a PhD, how one-size-fits-all prohibitions against side hustling hurts the PhD workforce, and how Jackie advocates for the grad students she works with now.

1:46 Emily: I’d like to take this opportunity to invite you to the next Ask Me Anything on mortgages and being a first-time homebuyer with Sam Hogan, which will be this Thursday, September 28, 2023 at 8:30 PM ET / 5:30 PM PT. Sam is a mortgage originator specializing in early-career PhDs, an advertiser with Personal Finance for PhDs, and my brother. If you are considering or embarking on the home-buying process and have a question about any aspect of it, please join us! That goes double if you have fellowship income, which can throw a wrench in the mortgage approval process. Register for the September session or any upcoming one at PFforPhDs.com/mortgage/.

2:35 Emily: You can find the show notes for this episode at PFforPhDs.com/s16e2/. Without further ado, here’s my interview with Dr. Jackie Nikpour.

Will You Please Introduce Yourself Further?

02:51 Emily: I am delighted to have joining me on the podcast today, Dr. Jackie Nikpour she is a PhD prepared nurse, currently doing a postdoc at the University of Pennsylvania. And our topic today is side hustling, especially as a graduate student. So Jackie, I’m really pleased that you decided to join me on the podcast today to talk about this topic and will you please introduce yourself to the audience a little bit further?

03:13 Jackie N: Sure. Thanks so much for having me, Emily. So, like you said, I’m currently finishing up my postdoc at the University of Pennsylvania. I’m a nurse by training, so started my career as a registered nurse in pediatrics, medicine, behavioral health, and then went into grad school, finished my Ph.D., and now working at the Center for Health Outcomes and Policy Research at the University of Pennsylvania School of Nursing. A lot of folks know that as the center that does all of the research on nurse staffing ratios and how that impacts patients.

03:51 Emily: And you shared with me just before we started that you are currently interviewing for a faculty position, so you are pursuing the academic faculty route.

03:58 Jackie N: Correct. I really want to stay in the research realm. Scholarship is sort of my bread and butter. And so teaching is something that I enjoy and I want to do. But my my focus is more tenure track.

Working Before Pursuing a PhD

04:13 Emily: And can you give me an idea of how long you worked as a nurse before you pursued your Ph.D.?

04:18 Jackie N: Yeah. So I would say everyone, every nurse who participates has a little bit of a different story. So I say I’m a kind of nontraditional person, but I don’t think there really is a traditional PhD prepared nurse anymore if there ever even was to begin with. So I kind of always knew from my undergraduate nursing school research experiences that I wanted to be on the research side. And I knew from both my personal life as a caregiver for a chronically ill parent and as a nurse later on, caring for kids from all over the world at Children’s Hospital, Philadelphia, but also kids from Philadelphia who oftentimes were from low income neighborhoods and might not have always had the resources to to stay healthy. I kind of knew that that as a nurse, I was often a Band-Aid for a very broken health care system. So I worked full time for a year and then pursued. I went directly from a B.S. to a PhD or a Bachelor of Science in nursing to a program. I don’t have a master’s degree at some point, and I get one that’s, again, that sounds a little bit atypical, but it’s becoming more and more common. These are more obviously research degrees, whereas a master’s in nursing is much more clinically oriented for the most part, so it’s seen as less of a requirement. So worked full time for a year, went into my PhD program and then we’ll talk about this a little bit later on. But about halfway through, started working as a nurse again in a per diem.

Transitioning From Nurse to PhD Student

05:59 Emily: Yeah. So the reason I wanted to kind of ask for this is because I wanted to know your motivation for taking side, hustling very seriously while you were in your PhD program. And I wonder if it was because you had experienced an income decrease coming into graduate school. It sounds like maybe you did, but it wasn’t like you had, you know, been multi multi year has grown accustomed that lifestyle. You were still kind of in a student kind of mindset, is that right?

06:20 Jackie N: Definitely. But it still was a hit. You know, I worked full time. I worked for a very well-renowned hospital, which is great in terms of the experiences I got. But also I think because of the name of certain well known hospitals, the pay isn’t quite as high. And so I was also long distance with my now husband before we were married at the time. So. So that was a hard kind of financial thing, traveling back and forth from Philadelphia to Atlanta. And I, you know, left that position, moved and went to making probably about half of the income that I was. But I prepared for that. I worked really hard to save up a lot of money as much as I could before I left. I tried really hard not to take as many vacation days as I had available so that they could all get paid out and say I was leaving all things that were a little bit tough but I knew were temporary and would help kind of set me up for success knowing I was going into a PhD program that would not offer the same kind of income support

Doctoral Institution and Stipend

07:30 Emily: And so where did you do your Ph.D. and how much was your stipend when you started?

07:35 Jackie N: I did my PhD at Duke University in Durham, North Carolina. And when I started out, Oh gosh, I have to think back, when I started my stipend was in the 35 to 40000 range. I can’t remember specifics, but it was relatively decent. Actually a big reason that I went there was lots of reasons that I pick my program, but it was helpful that Durham, North Carolina, did not have the same high cost of living as major cities like Philadelphia or Atlanta or other places that I was looking at. So that was a cost. You know, that was a driver for me. And as I’m sure it is, and what is for a lot of people. So that kind of went into my my decision making and leading up to starting with the PhD program, I definitely plan out the financial. It’s very uncertain what my outlook was going to look like.

Why Start a Side Hustle?

08:32 Emily: Okay. So it sounds like you prepared really well in that year that you had working to do to set yourself up again for starting the program and you said you started side hustling about halfway through. So what was the reason for it? Was it financial or were there other other factors?

08:45 Jackie N: Yeah. So I would say that there’s a couple of things. One of the, I guess both challenges and opportunities that I had was I was part of a national scholarship program that fully funded my tuition, have some funding for expenses like conference travel, provided extra mentorship, things like that. And in exchange for that, I completed my Ph.D. program in three years, actually, I did mine in two years and seven months, which is very chaotic. But it was good and was not crazy in the nursing field. I would say most people do their PhD between three and five years, a little bit more, a little bit less depending because you’re not in a lab, you’re not really working as an R.A. or TA as much as maybe in a STEM or humanities type of field by job. But all that to say that once I got through the first half of my program, which was very class oriented and I was, you know, really hunkering down during the semester and focusing on coursework, once I got through that and I was no more focused on my dissertation, I had a little bit more flexibility. I think I wanted more clinical experience because again, I’d only had about one year of full time clinical work and I had a really good friend who I was living with at the time and she is very passionate about the adolescents with severe eating disorders population and turned out there was a facility about 10 minutes from my apartment that she started working at and they were really actively hiring folks was right before COVID hit and I decided, okay, you know, if I can do this per diem and sort of make my own schedule so that I’m still, you know, obviously prioritizing my Ph.D. and finishing my dissertation, this might be a nice way to make some extra income. And further my clinical training, which even though I’m focused on the research side, I think having clinical experience to some degree have helped shape your way of thinking. So all of those things kind of came together and supported me in doing that. Then I say it was right before COVID because after I got hired about three months later, COVID hit, everything was remote. So I wasn’t driving back and forth to campus anymore, which saved me some time. So I was doing my Ph.D. kind of discussion work from home and then just driving 10 minutes in and 10 minutes home the next morning because I work night shift sort of on a schedule that I was able to to choose. And you, you know, all of those things kind of coincided, too, to allow me to continue.

Side Hustle Schedule

11:36 Emily: So it sounds like you were really thinking about the side hustle as part of your career progression as well. Yeah, although to me, when you said you completed your PhD in two years and and nine months, it was a bit shocking to hear that you also fit in a major side hustling position once you started really working on a dissertation. So we’re going to talk more about that in a moment. So you mentioned, you know, what your side hustle was, why you decided to pursue it. Can I ask maybe this is a silly question, but working the overnight shift, were you sleeping overnight or were you then sleeping during the day or like how did that aspect of it work?

12:12 Jackie N: So I would really plan my schedule based on what I had going on. So like for example, Monday mornings I was always meeting with my statistician to do the actual, actual quantitative findings from my dissertation. So I wasn’t working Sunday nights because I knew I had to meet with her every morning at not every Monday. So I was planning out my schedule a few weeks in advance based on when I knew that I had a meeting scheduled, I would block off time to work on my dissertation on my calendar and really only picked those nights that I knew I could sleep in the next morning. So I would work 7 p.m. to 7 a.m., get home, sleep until about noon or 1 p.m. and then wake up and kind of go about the rest of my day. The days after night shift were a little bit tricky, so I tried to use those days to get done work that didn’t involve as much brainpower. If you will catch up on emails, Maybe if I had like a paper that I was a coauthor on and I just had to look over it and provide edits, I could do that. But those were not my, like super heavy intellectual working and writing my dissertation days. I sort of staggered those so that I wasn’t doing that. I really only worked probably 2 to 4 nights per month, maybe a little bit more in the summer. But it ended up being about one or two nights a week, if that, sometimes more, sometimes less, depending on schedule.

13:49 Emily: What I like about what you said about how you set this up and what I think is applicable to other people who might not be taking on night shifts for their, you know, side hustle or maybe managing it at a different time is how you kind of you said a week or two in advance you would sort of like theme the days like on this day I’m going to be doing my heavy thinking dissertation work, really doing analytical stuff on this day. I know I’m going to be doing lighter work for your reason. It was because your sleep schedule was a little bit disrupted, but for other people there may be other reasons do that just because they maybe learned their own natural energy to the week when they’re going to work best and whatnot. And this is something that I have, I did not learn as a student, but I have only learned as an entrepreneur that like it’s really helpful, I think, to literally the podcast that I listen to, it calls this theme days. So like in my business, I have days when I’m more focused on clients and days and I’m more focused on content and days where I’m focused on business operations and so I find it really helpful not to just be like at any moment I could be doing any work and it’s all top priority, you know, like I know what the priority is for the day. So I really like that about the schedule that you developed.

14:49 Jackie N: I would say looking back, you know, I don’t think I intended to do that originally, but I do think that taking that role on really how my time management skills because I didn’t have a choice and and that was something that, you know, set me up for for success down the line. It not only allowed me to kind of think about how I would approach my week and set up days with, you know, priorities for the day and what that focus was going to be. But it also set me up to be in a better position when I was going for postdocs and even just life in general. One thing I did mention was that I was also planning a wedding at the time, so so that was a huge help for that. It was a huge thing that allowed me to help pay down my student loans during the student loan pause when there was no interest accruing. So it ended up being an incredibly valuable experience and in a lot of ways that maybe I didn’t anticipate when I started.

15:51 Emily: Yeah, is there anything else that you want to kind of add about that? People don’t like the word balance anymore, but the way you worked between your dissertation, work your side hustle, your life, everything else, anything else you want to add about that?

16:06 Jackie N: I would just say that I think it required a lot of intention. I am very lucky that I had a supportive partner, but even if you don’t have a romantic partner, you know, having people that you can ask for help when things get a little bit chaotic and knowing your own limits and knowing like, let’s say someone who is going to pick up a shift, if I knew it was a really busy week, say, you know, I can’t do this. So knowing to ask for help, knowing when you need to back off certain things. And I agree. I mean, the word balance, I think is hard because it’s never like a 50/50 balance of anything. It’s sometimes this is going to take the priority. You know, sometimes I need to be focusing on finishing this dissertation chapter. Sometimes it’s going to be summer and I keep focus a little bit more on making extra money for my wedding? Things like so priorities shift and just being mindful and aware of that. You go along. It’s for me something that I still do. You know, I’m not in a [??] role anymore.

17:12 Emily: And I love that so much. It’s just another way to like sort of broaden your horizons and, you know, get outside of the academic setting and academic bubble through your work and you’re also making money the same time. It doesn’t hurt.

17:23 Jackie N: Which was really, really valuable. And, and one thing that I wish was maybe a little bit more normalized in nursing programs. There’s a little bit of a hush hush kind of policy of you’re not supposed to be working because you’re supposed to be focusing on your dissertation. But stipends are low and often don’t meet the cost of living. And it’s a little bit untenable to expect graduate students who have a very applicable set of skills to not be using them in cases when they’re able to.

Commercial

18:01 Emily: Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, goal-setting, investing, frugality, increasing income, or student loans, each tailored specifically for graduate students and postdocs? I offer seminars and workshops on these topics and more in a variety of formats, and I’m now booking for the 2023-2024 academic year. If you would like to bring my content to your institution, would you please recommend me as a speaker or facilitator to your university, graduate school, graduate student association, or postdoc office? My seminars are usually slated as professional development or personal wellness. Ask the potential host to go to PFforPhDs.com/speaking/ or simply email me at [email protected] to start the process. I really appreciate these recommendations, which are the best way for me to start a conversation with a potential host. The paid work I do with universities and institutions enables me to keep producing this podcast and all my other free resources. Thank you in advance if you decide to issue a recommendation! Now back to our interview.

Side Hustle Policies

19:22 Emily: Let’s talk about that a little bit more. So like, was there an official policy either for your scholarship or in your program regarding side hustling?

19:32 Jackie N: Yes and no. It was a little bit of an honor system in general, I would say, at least in most research intensive programs. I don’t know about teaching or other programs. It’s a little bit kind of hush hush like you’re not supposed to outwardly say that you’re working clinically. You know, I never told my advisor until after I finished my dissertation. Now that she wouldn’t have been understanding, but just that I didn’t want to put myself in a position where I was potentially not being seen in a very positive light. And that’s that was hard. You know, I wanted to grow my skills and I got a lot out of that, like I said, influenced my career and my and my research. For my scholarship program. And we came in, they had told us, you know, you’re not supposed to work more than 20 hours a week, and 20 hours meaning in addition to your your your scholarship and your your studies. But a lot of times people were just not either following that or some universities will require their students, their students, to to pay for 25 hours a week during the semester. And then it becomes a conflict between the scholarship and the school. And you’re kind of caught in the middle. And that’s a really hard position to be in to. The other thing is that if you are, so that was the scholarship that I was a part of, that was through a private foundation called the Robert Wood Johnson Foundation. It’s a very large health care foundation. I was not funded as a PhD student through NIH, National Institutes of Health. As a postdoc I am. NIH training grants that fund PhD students and postdocs have a limit that you are not allowed to work more than 10 hours per week outside of your funded scholarship work. And that’s, in my opinion, a little bit outdated because NIH also sets limits on what you are able to be paid annually. And so it was like, okay, you’re telling me this is how much money I’m going to be making and I can’t work more than this amount outside of this. So what am I supposed to do if I’m not meeting ends meet? Like it’s just is a little, and there’s ways I think to to kind of I don’t want to say get around it, but like for example, I was a co-investigator on a study and ended up doing the the brunt of the actual work in terms of we did qualitative interviews. I led a lot of the quantitative analysis and we ended up with an extra, I think like $500 on the grant. And it was just used to sort of compensate me for the additional labor that I took on. So that’s not like a quote getting around it like that. It’s perfectly legal, if you will, but there’s other situations in which that’s not a tenable way to exist as a PhD student or as a postdoc. And so I think that’s a big structural barrier that a lot of people are kind of calling on NIH to address.

23:13 Emily: What would you put forth as like your preferred policy? Like, would there not be a number, like a ceiling on outside work or like, Well, because we all like, I think everybody is in agreement that the Ph.D. work, the dissertation needs to be the number one priority. And the person, whether as a position or as a postdoc like, you know, be making progress towards whatever your goals are and whether it’s side hustling that has gotten in the way of that or whether it’s something else has gotten in the way of that, like the student or postdoc and the supervisor need to make sure that that person is still on track. So what should what should the language be?

23:47 Jackie N: That’s a good question. And I don’t know if I have a specific this is what it should be instead of this, but I do think that it should not be a one size fits all case because this is the case across all NIH, NIH has 27 institutes and centers and these students and all of those kind of areas of research look very, very different. And nursing is a great example, right? If we’re told you can’t work more than 10 hours a week outside of your scholarship postdoc work, well, nursing shifts are typically 12 hours in line. So you’re telling me I can’t pick up a 12 hour shift on a Saturday or Sunday when I’m working 40 hours Monday through Friday? Like that’s it just wasn’t designed with that in mind because it was designed to be a one size fits all case. So I think it’s about maybe tailoring some of these things for each discipline or each university or I think what I’m seeing just more broadly and a lot of college programs is mentor mentee sort of informal kind of contracts where each party, each mentor mentee kind of shares what that relationship is going to be like and what each person’s responsibilities are and creates an opportunity to come up with an individualized plan for your development as a scholar. And when those are in place, I think that does open the door to more conversations like, Hey, listen, advisor, I really need to make extra money. Not only, you know, because my stipend is as low as a student, but what about people who have kids or what are people who have aging parents or other kind of life things going on that that they need to be able to support, you know, those sorts of things I think need to be addressed because that’s what you’re bringing to the table, right? You don’t just exist in academia as a, as a person and have nothing outside of it. Like we are fully complex, complicated, messy humans. And we sort of are the total package that we are. And so I think just creating a little bit more flexibility in place because every student, every discipline is so vastly different.

Structural Barriers in Academia

26:13 Emily: Yeah, I’m starting to, as I’ve put more and more of my own focus on advocacy and not just on like the personal of personal finance. I’m seeing the finances of PhDs as a workforce development issue. And you kind of brought this up earlier, like who gets to do a Ph.D.? Who gets to the completion point of a Ph.D.? And the finances can play into this in terms of what populations even are able to pursue that. So can you talk a little bit more about that?

26:40 Jackie N: Absolutely. I think there are so many structural barriers that limit even who is able to get in the door in academia. And I have colleagues who are in the very position where they’re low income, have family in a different state or in some cases in a different country, oftentimes are trying to send money back home to support their low income families. Maybe not may not be able to afford a car, especially in a place like where I was in Durham. I had friends who they couldn’t afford to purchase a vehicle, which was hard because it’s a very car dependent place. You know, there wasn’t a ton of public transportation available. And so that impacts even the time it takes you to get to class and how long you you have to study and get stuff done maybe in the morning before classes or how long it takes to get home. And that’s just the timing takes away from other things that you could be doing, including your dissertation or assignments. Are there is the caregiver aspect that we just talked about. There’s so many things, plus the fact that, you know, this is a very low wage job because that’s what it is. It’s a full time job. You know, you’re still a student, but it’s work. And and there’s just so many people who I think we lose out on in all disciplines because they are not able to turn their lives upend their lives to complete the demands of a program. And there’s no resources in place to support so many of them.

Advocacy in Academia

28:29 Emily: So the side hustling could help, Right? Side hustling is a bit of a Band-Aid. Like ideally NIH, everybody else would just pay people enough that at least most situations you wouldn’t need a side hustle. Now, in your case, we just talked about side hustling had other advantages besides the financial and that’s awesome. So can you tell me, is there anything you’d like to add about how you advocate now for other PhD prepared nurses around being able to side hustle so they should they so choose.

28:55 Jackie N: Absolutely. I think, you know, I’m still in a postdoc role, but I do have students who I sort of informally mentor and like, for example, I work on on one project that is a clinical pathway. We support patients who are insured by Medicaid in discharging home from hospital, make sure they get the support resources they need so that they’re not readmitted. We have grad students who work on our data collection, who run our weekly case conference meetings, who do a lot of that labor. And I’m always, you know, encouraging them and watching them make sure you’re keeping track of your hours, make sure that you are submitting for all of the time that you are eligible to be paid, because we want you to get as much money as you as you are entitled to right like you’re signed on for 10 hours a week. Like make sure that you’re actually submitting those 10 hours per week. I am. I work a lot with trying to make sure that, let’s say when we hire doctoral students, research assistant, what is the maximum amount that we’re able to pay? And let’s pay them off because first of all, that’s grant money that needs to be spent anyway, number one. Number two, I know what it’s like to be in the position. I was in it very recently myself and so I would say a lot of that advocacy that I’m doing is just within my own kind of world and those students that I work with. But it’s also showed me a lot about the kind of mentor that I want to be, Let’s say when I have my own PhD student advisees. I want to make sure that I’m creating a culture where I know what my students needs are and they need to work to support that and support their families, then I’m going to work with them to make that happen. No matter what we need to do, we’re going to get it done. I think myself and a lot of other folks, anytime there’s like an NIH open comment period about how we support career postdoctoral trainees who are funded through NIH, I really make an effort to to comment on those sort of open forums and give examples of here’s what let’s say raising the stipend for each, let’s say first year, second year, third year each has its own kind of stipend, years of experience. Raising those that could help support so many things that actually contribute to better scholarship because you’re not spending ten, 20 hours a week doing this other work. So that’s part of it. I will also say that, you know, this was not my case, but I know folks who were in student unions as students, I will say in one case in a major cities like New York and L.A., where cost of living is super high, it’s actually a little bit of a disadvantage if you want to get an NIH doctoral funding award because the stipends for that would be lower than what you would get as a stipend just by being a physician at the university. And so that’s a barrier because getting those awards sets you up to be competitive for postdocs and faculty candidates. And so that’s creating space to dismantle some of those structural barriers that prevent people from even entering academia in the first place and then developing the best science that they can.

Best Financial Advice for Another Early-Career PhD

32:23 Emily: Love it, Jackie. I think we need to leave it there. The hour has flown, so I want to ask you the last question that I ask. Of all my guests, which is what is your best financial advice for another early career? It could be something that we’ve touched on in the interview already, or it could be something completely new.

32:39 Jackie N: I would say the best advice that I can give to anyone financially going to a PhD program is just to plan as much as you can for the years ahead. You know, you’re in a PhD program, you’re already going to be, you know, I think I don’t think there’s been a PhD student who’s never been stressed out. So you’re already going to be stressed out about figuring out your dissertation, finishing your coursework, getting all the things that you need to to to get your degree. You know, you don’t want to be stressed about finances, too. I think when I first entered my PhD program, I was so I need to know exactly what my dissertation question is going to be because I’m on this three year track and I don’t know what I’m going to do, how I’m going to have enough time. I wish I hadn’t been so focused on that and I had, you know, more so narrowed my focus. I mean I did to some extent, but just planning out and budgeting. Okay, what realistically is my income going to be? How can I save up as much as I can and prepare to not have this be a stressor when I’m in the midst of everything else? And that also includes knowing, you know, sorry, but that also includes knowing about what life is with taxes as a PhD student, because it’s very, very different than I expected. So just knowing what to expect, I think, again, your your website and your your content and your podcast is a great way to support incoming PhD students. So just the preparation involved is what I would say.

34:14 Emily: Well, Jackie, I love that advice. It’s been so wonderful to talk with you and thank you so much for volunteering to come on the podcast.

34:20 Jackie N: Of course. Thank you for having me.

Outtro

34:27 Emily: Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by Dr. Lourdes Bobbio and show notes creation by Dr. Jill Hoffman.

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