side hustle

Financial Hacks Unique to Graduate Students

February 10, 2025 by Jill Hoffman 1 Comment

In this episode, Emily interviews Kyle Smith, a sixth-year graduate student at Penn State, about the financial strategies and hacks he’s used during grad school to increase his income and optimize how he spends and manages his money. In addition to side hustles and credit card and banking bonuses, they discuss how graduate students can benefit from using 529s and 457(b)s in a unique way. Kyle’s message is that finding ways to spend a few percentage points less on much or all of your expenses really adds up over time to confer financial security in the present and increase wealth in the long term.

Links mentioned in the Episode

Financial Hacks Unique to Graduate Students

Teaser

Kyle (00:00): By saving a few percent off your living expenses, having your emergency fund earn a few extra percent, saving a few percent on your taxes for money, that’s gonna grow a few percent every year until you retire. Um, these things, when combined, uh, really start to add up and let you, uh, get to a place where you have enough money, that you have more financial stability and more flexibility, uh, to do the things you want. Um, and really a lot of it comes from having enough of an emergency fund saved up that you can do these sorts of strategies.

Introduction

Emily (00:39): 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 (01:08): This is Season 20, Episode 3, and today my guest is Kyle Smith, a sixth-year graduate student at Penn State. Kyle and I go deep on the financial strategies and hacks he’s used during grad school to increase his income and optimize how he spends and manages his money. In addition to side hustles and credit card and banking bonuses, we discuss how graduate students can benefit from using 529s and 457(b)s in a unique way. Kyle’s message is that finding ways to spend a few percentage points less on much or all of your expenses really adds up over time to confer financial security in the present and increase wealth in the long term.

Emily (01:49): 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. 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/s20e3/. Without further ado, here’s my interview with Kyle Smith.

Will You Please Introduce Yourself Further?

Emily (03:24): I am delighted to have joining me on the podcast today, Kyle Smith. He’s a sixth year graduate student at Penn State, and we are going to talk about, well, I’m gonna reference the title of another podcast, I listen to All the Hacks. We’re gonna talk about several different, numerous different kind of financial hacks that Kyle has used throughout graduate school to increase his income, decrease some expenses, optimize finances in a few different ways, and Kyle’s been at it for several years, so he has a lot to share with us, some very unique strategies that we hardly ever touch on in the course of the podcast. So you’re definitely gonna hear some new stuff today. Um, Kyle, thank you so much for volunteering to come on the podcast. And will you please introduce yourself a little bit further for the listeners?

Kyle (04:03): Yeah, my name’s Kyle Smith. I’m a, uh, sixth year graduate student at Penn State. Like you said, uh, I got first introduced to your podcast right before I was starting, uh, graduate school, so I’ve been able to learn from some of your tips over the years. Um, my research, I’m in the anthropology department, uh, looking at dog human interaction. So for my research I’ve gotten to go to the dog park and watch people’s dogs and, uh, study how they think and interact with people, um, which has been a lot of fun.

Motivation Behind Pursuing Financial Hacks

Emily (04:31): Yeah, that does sound like fun. Um, okay. We are going to, as I said, talk about some different financial hacks that graduate students may be able to apply in their own lives. But before we get into your list that you sent me, um, I wanted to know why have you pursued all of these and kept going with, you know, some of them that worked out? Like why not just take your stipend and work with it as is and not put in the effort to find these extra, you know, extra workarounds? So tell us about that motivation.

Kyle (05:02): Yeah, I suppose really kind of my whole life, I’ve just been more of the saver sort of mentality. Um, you know, just whatever money I got, I would usually just save it up. Um, I think I tend to have less expenses that I wanna spend money on compared to a lot of people. Um, but then, so I’ve just tried to, you know, just kind of accumulate enough excess that I have the flexibility that when there is something then that I wanna spend the money on, um, that I have enough of a buffer to do. So. Um, so really been just kind of, uh, trying to optimize things to just accumulate a little bit more, uh, focusing a lot on retirement and especially saving for retirement in a way that gives them flexibility with what to do with that money, which we’ll get into it a little bit later. Um, and just realizing that, you know, any money that you’re saving up now and investing, uh, for the future will be worth a lot more later. Um, so, you know, if you’re fine to do a few things to save on some of your expenses, that that really adds up over time.

Emily (05:59): Absolutely. And I do wanna point out that, um, in the list that you sent me, there really isn’t too much about what I would call like true frugality. We’re actually not talking about decreasing expenses in terms of like giving up, uh, quality or downsizing or anything like that. We’re really gonna be talking about earning more or like financial type ways to spend less without getting less. Is that a fair way to characterize the list?

Kyle (06:24): Yeah, I would say so. With the things I’d mentioned. I mean, I definitely do, you know, try to, you know, spend less money on, you know, don’t eat out super often. Uh, split living expenses with people, um, never lived solo. So, you know, there’s strategies like that that have saved some money. Uh, but um, yeah, a lot of the things I just try to figure out ways where if I have a recurring expense I can save a few percent on it. Um, you know, if I have some money sitting there, I can get a few extra percent on it. Uh, and finding that those really add up over time.

Emily (06:57): Yeah, and I especially wanna point this out for like the listeners who <laugh> have, have felt like they’ve maxed out on spending less. Like I’m doing everything already that I can to spend less and I’m not interested in cutting any further. How can I earn more or optimize more to, you know, free up more money for my goals? Right. So that’s really what we’re talking about today. Okay. So let’s jump into your list. The first thing you told me is that you volunteer for research studies. Tell me about that and how much you’re earning from it.

Grad Student Financial Hack #1: Participating in Research Studies

Kyle (07:27): Yeah, there’s, it’s been a while since I’ve done any of those. Um, but you know, when you’re on campus in a university you can walk around the hallways and see there’s, you know, signs sometimes where they have looking for research participants. Um, you know, so a lot of times I’ll just pay attention to that and um, follow up with that if it seems like something that’s worth pursuing. Um, you know, plenty of studies are kind of short and you can make a quick 20 bucks or some are a little more involved, but you can make hundreds over time. Um, you know, so there was one in particular, uh, that I got quite a bit from because they were doing a longitudinal study of graduate students that started my first year of graduate school. Um, so there were kind of recurring surveys that they would have you do, they’d have you come in sometimes, uh, for some invis- in-person, uh, sampling, such as like cutting your hair to look at your cortisol and stuff like that. Um, you know, so I saved up few hundreds of dollars, uh, through studies like that. There was one I did where they were did an MRI scan of my brain that they also pay you a little bit higher for, uh, ’cause you’re in a cramped box. So yeah, just looking out for opportunities like that allow you to sometimes save just a little bit extra money here or there. Uh, and then if you have a strategy where you’re trying to save anything extra for retirement, uh, or for the long term instead of uh, you know, getting an extra $20 and immediately spending it, then that really adds up over time.

Emily (08:46): Mm-hmm <affirmative>. Either way, whatever you wanna do with it, it’s your extra $20 here or there. I mean, like you said, in any sort of large research university, there’s gonna be studies like that. I think one of the other bonuses is that sometimes they’re actually pretty interesting to participate in. Um, like you actually learn something about yourself or about the study or, or what have you. Have you found that to be the case?

Kyle (09:05): Oh, definitely. Um, you know, it’s been interesting just getting to see a different side to research from the research that I’m doing and the research that I read about. But actually being a participant in it, um, can be pretty interesting sometimes, especially when you see connections with like what you’re doing. Like I had look at the hair, cortisol, the dogs, and I was giving my hair for the hair cortisol. Um, there was actually a study I did when I was an undergrad. I volunteered and they as part of it, uh, took my DNA and I got my 23andme results back in addition to getting paid for doing it. So that was an interesting thing,

Emily (09:37): Definitely. Wow. Gotcha. Okay. Next item on your list was a side hustle, a true side hustle. Tell us more about that.

Grad Student Financial Hack #2: Editing as a Side Hustle

Kyle (09:46): Uh, yeah, this was kind of funny ’cause it was just came out of nowhere. I got an email in my inbox one day, um, saying that the person was a Chinese academic who was looking for American students to help edit manuscripts by Chinese academics. Uh, and asking if I was interested. And I immediately thought that it looked like some sort of scam phishing email. There was a strange address. Um, you know, people offering you money that you’ve never heard of before is usually something to be a little wary of. Um, but it seemed, you know, I thought about it and I was like, well, it might be legit. So I tried to look up the person and looked up his papers. Um, I found that, um, people in the acknowledgements had been thanked for helping translate, so I actually reached out to those people before him and was just is that guy legit, and they, they told me they’d work with them and had good experiences. Um, yeah, so that was just kind of an occasional thing. Sometimes I would do a few of these in a month, sometimes they didn’t offer me any for a while. Um, but yeah, just, uh, he seemed to have some connections to other researchers and try just to reach out to Americans, uh, to help just edit the English. I’ve done a handful of those over the past few years. They usually paid around 150 to $200 per manuscript depending on how long it was.

Emily (10:55): That’s an amazing pay rate. Yeah,

Kyle (10:57): No, it’s been, that’s been a good way to, it’s not a reliable enough thing that I can count on that as predictable income, but just occasionally they reach out and they’re like, Hey, can you do this paper?

Emily (11:07): I really like this type of side hustle that just opportunities come your way and depending on your schedule and your availability, you can just say yes or no and that’s great. It’s nice to not be committed to something when you go through busy or periods as a graduate student.

Kyle (11:21): Yeah. Whenever they’ve reached out about editing these, they’ve asked first if I’m available before sending it and you know, there were a couple times where I’m like, no, sorry, I’m too busy this week.

Grad Student Financial Hack #3: Credit Card/Banking Bonuses

Emily (11:31): Absolutely. Okay, next item on your list is kind of a bigger one. Um, credit card and banking bonuses. Tell us about your strategies here. Yeah,

Kyle (11:40): There, there’s a few websites out there that accumulate these sorts of things. Um, doctor of credit is one where they have bank bonuses and credit card bonuses that are, uh, being offered at that time. Sometimes you get some in the mail so you know it’s worth checking your junk mail about these. Uh, and a lot of times different banks will, or credit cards will offer you like a couple hundred dollars if you sign up for a bank account or open a credit card with them and spend x amount of money in the first certain amount of time. Uh, and in many cases these can be, uh, fairly profitable ways with not that much effort. Um, usually there’s some sort of requirements attached to it, so you have to pay attention to those and carefully note down, uh, what the requirements are and if you can meet those and that you’re not gonna be incurring more expenses than you’re getting back. But for instance, a lot of banks, they’ll say like $200 if you direct deposit at least a thousand dollars. So I just update my direct deposit for that month, you know, have my next paycheck go into there and then, you know, change it back after that. And there’s, if there’s not ongoing fees for maintaining it, um, then that’s sometimes just an easy way to get some money.

Emily (12:47): Okay. Yeah. Let’s pause a little bit on the banking bonuses. Um, so you just gave one example of like, oh, I just had to update my direct deposit to go to a different place. Um, sometimes you might have to keep that up for a few months. I think for some offers like this or other ones I’ve heard of, you have to keep like a certain balance in the account for a certain amount of time. So I’m wondering if you have done anything like that. Have you had to move like a chunk of money somewhere and kept it there to get a bonus?

Kyle (13:13): Yeah, there’s sometimes little requirements like that. Sometimes there’s a minimum bonus for a certain amount of time. Um, some of these, when you run the math, it doesn’t really make sense to do, but others, you know, I can keep a thousand there for three months and then get a few hundred dollars out of it. Uh, assuming you’ve got enough money saved up that you have some flexibility there. It’s a strategy that makes more sense. If you’ve got enough of an emergency fund that um, you have a few extra thousand dollars to spare, uh, some of them require a certain amount of transactions. Um, you know, there’s oftentimes easy ways around this. You can like set up your main account to just transfer $10 in and take it out automatically if you need to have a certain transaction each month, um, in order to not have a fee. Um, some of them are tied to like use your debit card, you know, 20 times in the first month and I just go to the gas station and buy a dollar of gas, buy a dollar gas, buy a dollar of gas just in a row. Um, so there’s ways to trigger it. And if you look on sites like Doctor of Credit, they usually detail, uh, what these are.

Emily (14:11): Hmm, that’s so interesting. I hadn’t heard about those little strategies just to fulfill that requirement like very quickly. That’s very helpful to not have to like think about it over a long period of time and remember, oh, I’m supposed to be using this card versus like this one to do this.

Kyle (14:24): Yeah. I think the way they get you with these things is they’re hoping that, um, it’ll be too much for you to do all that. So they either won’t have to pay the bonus because you trip up or that you just, um, you know, you’re not paying enough attention and then you start accumulating some monthly fee because you weren’t doing their one transaction a month or whatever.

Emily (14:43): So you just have to be really organized. Yeah,

Kyle (14:45): Yeah. You just have to be really organized, pay attention to what exactly the rules are and just make sure you’re following those to a T.

Emily (14:50): Yeah, absolutely. Okay. So let’s take like a credit card example then, since we just talked about bank accounts now. When I was in graduate school, it was quite a while ago, so credit card offers were different than they are now. I know. I was always concerned about being able to reach those signup bonuses like spend 1, 2, 3, 6, whatever it is, thousand dollars over two to four months. These kinds of things are common. Um, and I also, I don’t think in graduate school I ever paid an annual fee for a credit card. I do now <laugh>, but that was something I was just sort of like the whole category. I was just like against it at the time. Right. So like, tell us about that. Like how do you balance knowing that you’re gonna be able to meet these signup bonuses? You know, do you have any tricks about, you know, spending or timing the spending or whatever? Um, and also, yeah, how, how do you weigh the pros and cons if you, if there are some costs associated with it?

Kyle (15:38): Yeah. Um, I just try to pay attention to what my actual level of spending is and what the requirements are. And if there’s something where I don’t think I can meet the requirements won’t do it. I don’t have as many credit cards as some people who really pursue the strategy. Um, but there’s some that are quite easy to meet, like, um, some of the ones from Chase tend to be some of the most sought after ones and you can only get a certain number of credit cards per often before your credit score starts to go down and you start getting rejected. Um, but you know, some of the chase ones you have to spend $500 in the first three months and you get $200 or something like that. And that’s easy enough for most people do if they put all their groceries on it for a few months. Um, there’s some that have had bigger amounts, so some of the chase ones are more lucrative where you can get a thousand dollars signup bonus or so the amount fluctuates. So you have to look at the time, but you have to spend $4,000 in three months. And I don’t spend that much in that amount of time, especially ’cause uh, you know, you’re not paying the rent on the credit card typically. Um, but there are strategies that you can do and I think you’d only wanna do this if you’re the kind of person who knows that you’re gonna specifically be doing the math to spend the right amount to make it worth it for you instead of just spending a bunch of money and thinking, oh, I’m saving money because I get it, uh, a bonus. So what I’ve done when I, you have to spend like the, you know, a larger amount of money, you know, getting a thousand back on 4,000 spending is still worth it if you can make it work. So what I’ve done is just put everything that I can on it during that time. And then when it gets closer to the deadline, um, there’s various grocery stores and pharmacies sell these $500, um, prepaid debit cards with about a $5 fee, um, which normally doesn’t make any financial sense, but if you’re getting essentially 25% back, then you can put the last couple thousand dollars of that on these prepaid cards and then just use those for your expenses for the next few months. Um, so you can kind of preload your spending of that amount and let it stretch over your expenses for for many more months. Um, I’ve also, you know, paired this for if I know I’m gonna be booking some flights for the holidays or some other expenses. So when the timing of when you get these cards can matter a bit too.

Emily (17:47): Yeah. So not only for either one of these strategies, you have to stay very organized. You also have to really know your budget. You have to know what your spending is going to be over the next, you know, three or six months or whatever so that you can understand, yes, I’m gonna have enough spending or I’m not quite going to have enough. So as you said at the end, I’m gonna be able to use this strategy. But prepaying, you know, by buying gift cards or whatever, um, debit cards that requires you to have that money up front. So another area where we talked about like getting that first, you know, thousand two, three, $4,000 in like an emergency fund or just a general savings fund is so, so helpful to actually help you generate even more side hustle money. Like you’re really putting your money to work for you. Now we’re all of course hoping that an emergency wouldn’t come your way in that time when you have some money tied up in a de- in a debit card or whatever. Um, but anyway, it gives you more flexibility. So it’s just something that like builds on itself. Um, so if you get that first thousand, like then maybe the next, you know, few hundred is easier to come by ’cause you can use some of these like tricks and hacks

Kyle (18:45): For sure.

Emily (18:46): Um, and you also were just telling me that you paired this strategy with paying estimated tax on your fellowship. Can you tell us what that strategy was, uh, when, when you were using it?

Kyle (18:57): Yeah, so if you’ve not been listening to this podcast as much and you’re not aware of the estimated taxes, uh, sometimes if you’re on a fellowship, um, they’re not withholding your income tax and you’re responsible for paying that several times a year. Uh, I was on a fellowship like this my first year of graduate school. Some people are on it, if they have the GRFP for three years, depends on your situation. Um, and they let you, um, pay these payments either straight from your bank account or you can pay it with a debit card for like a $2 or so fee I think it is. Um, so again, if you’re able to buy these prepaid debit cards in such a way that you’re earning a decent percent back and then you can use that to pay your prepaid taxes for a small fee, you know, you do the math and see if the, if it works out in your favor, but especially if you’re getting a big bonus or if you have a big percent back on that credit card, then uh, it can end up saving you quite a bit more money than you’re spending in a fee. Um, there’s some credit cards too have like different rotating benefits. Like I have one that has a category that changes, uh, four times a year and sometimes they are giving you a bunch of money back for PayPal and they also normally give you money back for a pharmacy and those stack on top of each other. So if I can get 7% back at a pharmacy by buying a pre-K card and then use that for my taxes that they immediately refund to me, uh, that saves you a decent bit of money. Uh, the last time I tried that, they didn’t let me buy the prepaid card with the credit card at the pharmacy, uh, or with PayPal anyway. Um, so you have to, you know, your mileage may vary as they say, and the, the kind of rules for these things are changing all the time. But if you look at, uh, sites related to, you know, people who are doing these sorts of strategies, you can kind of find out to some extent what works and doesn’t at that time.

Emily (20:42): Yeah, all the like buying of gift cards, buying of prepaid debit cards, those kind of, um, ways to get up to those minimum spends. It’s a common suggestion, but the routes to doing it oftentimes get shut down. <laugh>, it, it makes sense that these things don’t always work in perpetuity, but as you said, there are resources available where you can learn how to pivot.

Kyle (21:01): Mm-hmm <affirmative>.

Emily (21:02): Yeah. Is there anything else you wanna add about the credit card or the banking bonuses?

Kyle (21:07): One thing with regards to the banking is, you know, another strategy is not just the signup bonuses, but banks that are gonna give you a certain amount of, uh, interest on what you have in that account. Uh, most banks tend to give you very low percentages these days, uh, but you can sometimes find some that give you a few percent back. I have most of my money, uh, in an account offered through Vanguard called Cash Plus, uh, that gives I think three or 4%, uh, per year of what you have in there as interest. It’s kind of a clunky account. It seems like it’s not as made to interface very well with other banks. So there’s been some frustrations with using that. But if you have thousands of dollars saved up as an emergency fund and you can get 4% of that back every year, you might as well park that money in a, in an account where it’s gonna be, uh, giving you a decent percentage back. And that just goes back to the whole theme of trying to optimize, uh, your finances by a few percent here or there, especially in the long term.

Commercial

Emily (22:07): 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.

Grad Student Financial Hack #4: 529 Contributions

Emily (22:58): Okay, now we’re gonna get into the strategies that I’m really excited about. So the first one is a 529 strategy. So Kyle, tell us, what is a 529 <laugh>? Why would a graduate student be using one? You know, how are you using it in a way that’s very different from how it’s like advertised?

Kyle (23:14): So a 529 plan is something that was created to help incentivize parents to save money for their kids’ college. Uh, if you’re familiar with retirement accounts, it’s kind of similar to that where you’re getting some tax benefits to be investing money for a long-term goal. Uh, but in this case it’s higher education. Um, the, like I said, the intention seems to be more about saving for your kids’ college, but they have some flexibility about this. It doesn’t have to be your child, it can be your grandkid or your spouse or even for yourself. Uh, and while the intention is that you’re, uh, going to for expenses farther down the road, usually, uh, the minimum amount of time it has to be in there, it seems to be about a week. And it’s not just college that this works for, they let you, you use these funds for K through 12 education that has tuition and also for graduate school. So a lot of states have tax deductions for people who contribute to these plans because they’re trying to incentivize people to invest in higher education. Um, the idea is if you’re a parent, you contribute, you know, a few thousand dollars each year, uh, invest it, and then when you’re taking time that money out for your kids’ education, uh, you don’t owe taxes on that after all the growth and you’ve been saving some money on your state taxes along the way. What I’ve been doing is a tip I learned from, uh, your site years ago where you create an account where you’re both the account owner and the beneficiary, you contribute money to it, withdraw it a week later after the hold lifts, and then you can, if you’re using those money for qualified educational expenses, you’re allowed to deduct that from your state taxes. So the qualified educational expenses, you know, you need to look up and make sure it works, but basically it’s room and board for a graduate student, it’s tuition’s allowed too. But since most graduate students aren’t paying tuition, that’s not as helpful. Uh, I believe you can also do a certain amount of, uh, student loan payments as well. So, you know, I’ll just every few months, uh, contribute some of my money into this account, withdraw it a week later, uh, and then just keep track of how much I’m spending on food and rent and then just kind of do this so that the amount that I’ve contributed and withdrawn, uh, is, you know, as close as I can get it to the amount that I’m spending on room and board without going over it. Uh, and then when it comes time to pay my taxes in Pennsylvania, I can deduct in theory up to $19,000, uh, of contributions from my taxes, assuming that that doesn’t, you know, go that I’m not using these for things that are other than the qualified educational expenses. And since the Pennsylvania income tax is 3.07%, uh, you know, that adds up over time. I think in total I’ve saved about $2,000 on my estate taxes over the years by doing this.

Emily (26:07): Wow. Okay. I can see now why you’re being careful to keep track of how much you’ve actually spent in qualified education expenses. So I didn’t know about Pennsylvania specifically, but some other states I’ve looked at, the benefit might be limited to like $5,000 or like a few hundred dollars even. So with having such a high limit then yeah, it really makes sense that you are trying to, as you said, get as close as you can to matching your actual qualified education expenses so you can try to deduct as much as possible for that year. Um, that may not be as much of a challenge in other states is what I’m saying. ’cause maybe your rent alone for a few months would already max out like that benefit. Uh, we’re using the term qualified education expenses, which very, very astute listeners will know that when we talk about qualified education expenses, we always have to say what the benefit is that is defining that particular instance of qualified education expense. So qualified education expenses from a five for 529 accounts, as you mentioned, include things like living expenses, uh, you know, room and board. Um, it’s defined, but qualified education expenses for other benefits are like only tuition and required fees and so forth. So just be sure that you’re looking at the right definition, the right list when you’re trying to figure out what your qualified education expenses are for 529s. Um, so anyway, your particular benefit in Pennsylvania sounds incredible because that limit is so high. Other states the limits will be different. Sometimes it’s a credit, not a deduction. Um, some states don’t have any benefit and we are talking about a state level benefit, not a federal benefit. So the state that I, that I live in, California doesn’t offer any tax incentives for contributions to 529s. So, you know, you may be stuck with a state that doesn’t participate in this in any way, and then this isn’t gonna work for you. But if you live in a state with income tax <laugh>, then you should certainly look up whether there is any 529 contribution benefit. And I’m just, you know, struck by the fact this is another example where because you have freed up, you know, a thousand, 2000 whatever amount of money that you’re able to move around and do these different things that like these 529 contributions, you’re able to then spend less so, so much more money, like how that little bit of financial flexibility is buying you even more and more and more financial flexibility. So for those listening, I would just say if you haven’t saved that first 1, 2, 3, $4,000, like work on that hard because then you can, these other ideas are then open to you after that point. That’s so awesome. Now I have been wondering about that residence time of like the money being in the account, um, because you know, in your case, like you don’t wanna contribute $19,000 and let it sit there for the whole year, right? You wanna do small bits like frequently throughout the year. Um, so how did you come to find out what the minimum time it had to spend in, in the account to, to, you know, qualify for this deduction?

Kyle (28:49): I don’t remember how I first found out if it was somewhere in the, you know, the documentation about opening it or if I’d seen other people mentioning it. Um, the one thing to note, like you said, the state laws vary quite a bit, so you just have to look up how it applies to you if it does. But the, um, some states require it to be a specific plan from their state and others let you do any 529 plan. Pennsylvania doesn’t care what state it is. So I just did it through I think the Kansas plan because I already had a Schwab bank account and Schwab runs the, uh, Kansas plan, but you know, there’s others through Vanguard or whatever the case may be. So you need to make sure about that. But at least the one that I’ve done through Schwab, the, it just needs to be there for one week minimum. And like you said, I’m not gonna put my entire living expenses for the year all in at the same time. Um, but every month or two, um, if you just have enough money saved up for, you know, the next month’s living expenses, you can put it in, in the middle of the month, take it out, and by the time you’re paying your bills at the start of the next month, um, it’s still back there. Um, so you wanna have, you know, some extra money saved up, but it doesn’t need to be a ton.

Emily (30:03): Yes. Wow. What a powerful strategy. And so you’ve been, have you been doing this the whole time you’ve been in graduate school?

Kyle (30:08): Yeah, I, I first heard of it I think either in the beginning of graduate school or slightly before. Um, so I’ve just been doing that the whole time. Uh, it saved me quite a bit of money on my state taxes.

Emily (30:18): Yeah, you said about $2,000, that’s something like 400 per year approximately, right?

Kyle (30:23): Yeah, something like that. I, uh, I got married last year. Um, my, my spouse is also, she was a graduate student. Um, so once I was married I started contributing for her expenses as well, which saved us a little bit extra. Um, but yeah, if you’re doing this, uh, in graduate school in Pennsylvania, you know, saving 3% on all your rent and food expenses each year really adds up.

Emily (30:47): Yeah, it definitely does. Oh my gosh, I’m so grateful for this example. Thank you so much for sharing this with us.

Kyle (30:52): One important thing to note with the 529 plans, uh, is because they’re not really set up for people to be using it in the way that I’ve been using it is you gotta pay attention to certain details. Like in my account I’m listed as both the account owner and the beneficiary. Uh, so you have to make sure that you are contributing as the account owner and removing money as the beneficiary, uh, because it gives you the option to also remove it as the account owner, uh, I guess for people who contribute it and then decide that they didn’t wanna contribute it. Um, but if you’re removing it as the account owner, uh, then they’ll say that you’re not actually contributing it. Uh, so then you won’t get that tax benefit. So you just need to pay attention to that detail.

Grad Student Financial Hack #5: 457(B) Retirement Accounts

Emily (31:31): Yes. Another example of where being organized and detail oriented is very necessary for making this strategy work. Okay, awesome. And then the last strategy you mentioned to me was about using a 457 retirement account, which is not one that gets a lot of airtime. So tell us what’s different about this account? Why do you choose to use this, um, either uh, first or in, you know, to supplement your other tax advantage retirement accounts?

Kyle (31:58): Yeah, so I was working for a few years before I started graduate school. So I already had a Roth IRA and an account from my employer. Um, they thought I was contributing money and saving up that way. Um, and then when I started graduate school, I was still contributing to the Roth IRA at first. Um, but then I saw, I just think I got some letter in the mail just mentioning employee benefits that I had access to and one of them was a supplemental retirement account and I was like, what is that? Um, so I looked it up and something that a lot of graduate students encounter is that they’re not eligible for most employer sponsored retirement accounts, so they can’t sign up for, you know, a 401k and get their employer matching their contributions or anything like that. Um, but uh, I found in my case this probably holds at some other universities as well that there’s something called a supplemental retirement account where they’re like, we’re not gonna contribute any money to this as your employer, but you’re allowed to put money into it. Um, at first this wouldn’t seem like it has that much of an advantage compared to just your own IRA because you’re managing that yourself. Why would you worry about involving your employer? But I noticed when I was reading the benefits that the 457B seems to have some really specific advantages that are actually quite nice and that I don’t think you can really get, uh, through any other account that I’m aware of. Um, so if you’re not as familiar with, uh, retirement accounts, uh, they, whether they’re an individual retirement account, an IRA or an employer sponsored plan, uh, there’s usually two types, either Roth or traditional. So Roth, you’re paying your taxes on your income now, um, and then contributing it to the account where it can grow, uh, without getting taxed on your dividends or anything when you’re investing it. Uh, and then when you withdraw it when you retire, uh, you don’t owe any tax on it. Traditional is the other way around where you’re saving on your taxes for what you contribute. You don’t have to pay income tax on it, it grows without getting taxed on the dividends. And then when you withdraw it in retirement, you, uh, owe tax on it at that time. Um, so there, there’s two different strategies depending on whether you wanna pay your taxes now or pay your taxes at retirement. And a lot of people seem to recommend the Roth accounts in situations where it actually doesn’t really seem to make sense. Um, the typical advice that you hear is, oh, if you’re, you know, a graduate student or somebody else with a relatively low income, you’ll probably be, uh, earning more money in retirement or when you’re older, so you might as well do the Roth now, uh, and save on your taxes ’cause you’ll owe more tax on it later. Um, there’s really no way of knowing exactly what your taxes will be in retirement because you don’t know how policy will change and how your lifestyle will change. Um, but let’s say for instance, you’re in the 12% tax bracket now and you’re in the same one when you retire. Um, if you contribute to a Roth account, you’re saving the 12% or you’re paying the 12% now and then you withdraw that tax free later. Um, but if you’re contributing to a traditional account, you’re paying, you’re saving the 12% now and then you pay o tax when you retire. But if you’re in the same tax bracket, the first chunk that you pull out goes to your standard deduction and you don’t owe tax on it, the next chunk you pull out is in the 10% bracket. And not only after that, uh, do you owe the 12% tax on it. So your average tax rate will actually be probably lower than your marginal tax rate. So it’s a little more advantageous in many circumstances to do traditional. Uh, one of the disadvantages with traditional, as opposed to Roth, is that money is tied up until you’re 59 and a half and you’re not allowed to remove it early without owing both the income tax on it and also a 10% penalty. Uh, with Roth, one of the nice advantages is you can take that money out, um, that you’ve contributed early without owing any penalties on it. Uh, that’s only a contribution. It’s not what it’s grown from being invested. But the unique thing that I found out about the 457B plan is it kind of is the best of both worlds. You get the tax benefit now, um, which like as I just laid out, is probably in most cases gonna be saving you money on your taxes overall. Um, but uniquely with it you can actually withdraw the money you contribute before retirement age as long as you’ve separated from that employer. Uh, and as a graduate student, I’m not planning on being employed by Penn State for the rest of my life just until I finished my PhD and then after that point I’ll have access to that money should I want it. Um, and I think that this is a really nice advantage because it’s nice to have the flexibility. You know, if years down the line I have a loved one who gets sick and I want to quit my job and you know, for a year or two live off of what I have saved up, I would be able to do that and I would just owe my income tax and not any extra fee. If I get to age 50 and decide I wanna retire, then instead of waiting until 59 and a half, if I have enough money, I could just go ahead and do that and use this account. So it gives you a lot more flexibility about how you wanna use it. Um, yeah, the, this does get withheld from your paycheck, so you have to a month in advance go in and say how much you want withheld. Uh, I’ve kind of adopted a flexible approach about this where I just look at my, uh, expenses and budget and how much money I have and I’ll be like, I have more money saved up than I need, so I’ll make my contributions a little bit higher. Or, oh, I had an unexpected expense this month with car repairs or something, I’ll make it lower. Um, but I’ve been trying to save up through that and uh, I think on average contributed in the like eight to 9,000 per year, uh, into this account, which is actually more than the space from an IRA.

Emily (37:25): Thank you so much for that thorough explanation. Um, I totally agree. So, because I think most, most Americans, if they have any kind of workplace based retirement plan, it’s gonna be a 401k or maybe if they’re a federal employee or something, TSP, but a lot of people who are employed by nonprofits, um, and also government agencies at whatever level, um, might have access to a 403 B and maybe also a 457 as you do, but, but because it’s such a small like kind of percentage of the population, this account doesn’t get a lot of airtime, you know, when retirement accounts are discussed. So you’re exactly right that like this benefit of being able to remove the money early without penalty is pretty unique. Um, that is to say without having a special circumstance, like you can remove sometimes for education or like stuff like buying a home, stuff like that, but, but without any reason, right? You just, you just have access to it whenever you want it. You don’t have to justify it. It is a really unique thing and especially attractive for people who are going for early retirement or as you said, might just wanna access a chunk of money for whatever reason, for special life circumstances or, um, what have you. So it is really unique. It sounds to me like you are using this as your primary tax advantaged retirement account, right? Like you’re, you’re not using a Roth IRA or anything similar in addition.

Kyle (38:39): Yeah. Ever since I found out about this account, I’ve only contributed to that for retirement. Uh, I still have the Roth IRA from before that’s been accumulating money in the meantime. Um, but because of the advantages of this and that I’ll only have access to it for the time that I’m a graduate student, uh, I’ve just been prioritizing anything that I’m saving for retirement into this account.

Emily (38:59): Absolutely. And I do wanna point people to season 17, episode nine, my interview with Dr. Corwin Olson. So he and I had a, a long discussion in that, um, episode about what you were just mentioning, how sometimes contributing to a traditional retirement account, even when you’re in graduate school or a fairly low tax bracket, uh, makes sense, makes sense in certain situations. It’s still not something that I’m gonna say is my number one <laugh> best thing to do. I still firmly believe in the Roth IRA for most people who are going to expect that higher income marginal income tax bracket in retirement. But certainly like we talked about with Corwin, like people who are planning on retiring early have to do a lot different kinds of considerations about filling up like the standard deduction aspect of their, um, income and the 10% bracket and the 12% bracket and so forth. So it’s kind of a different calculation. Um, but I appreciate you bringing that to light again and yeah, why this could be certainly a legitimate choice even for a graduate student.

Kyle (39:56): Yeah, and as far as I understand too, the fact that I have a Roth IRA, um, from before actually pairs well with this because, you know, I could withdraw from the 457B up to the standard deduction or up to the 10% tax bracket, and then if I’m still spending money beyond that withdraw from the Roth IRA without owing any extra taxes.

Emily (40:15): Absolutely correct. Yeah, I, that’s one of the reasons why I say that it’s great to have both traditional and Roth money available to you when you get to retirement so that you can do that kind of tax optimization. And we’re even talking about pre-standard retirement age in the case of the 457 that you, you would’ve access to it, as you said, as long as you’ve separated from your employer. So that’s a really exciting account to use. Um, as you kind of mentioned early on, you do have to be an employee of your institution to have access to this. So like you mentioned your first year you were on fellowship, I’m suspecting this letter came after you transitioned over to an employee type position. So for those listeners, um, for those listening, if you are an employee, then certainly this is something to check into. I would hazard a guess that, um, large public universities part of state systems like the one that you’re at are more likely to offer this kind of benefit than private universities, or it might depend on your state as well, like maybe some state systems do, some don’t, but I have heard of this for, you know, certain employees at um, large public institutions.

Kyle (41:19): Yeah. My understanding is that, uh, it’s more of a benefit of public universities, so you wouldn’t find it everywhere and some universities might just not offer it, but worth looking into if you’re employed by a public university.

Emily (41:32): Absolutely. Before I ask you my final standard question, I was just wondering, with all these strategies you’ve been using over the past five, six years, what’s been the effect? Like, have you, you’ve mentioned numbers here and there, but like have you significantly increased your income or your net worth or reduce your stress or like, what, what has been the effect of actually employing these strategies? And I guess also the cost, like how much time do you spend on these kinds of activities

Kyle (42:01): Overall, the result of these has been, you know, thousands of dollars that I’ve saved up. And because any extra money that I’m saving up, I’m putting into retirement accounts that’ll continue to compound. So, you know, a thousand dollars saved now will be even more thousands of dollars at retirement age. Um, so it’s really kind of had a snowballing effect, uh, where just a little bit saved results in making it easier to save more money, uh, which will result in more money with investments further down the road. Um, so I found it to be definitely worth pursuing. Uh, my net worth has definitely increased quite a bit in graduate school, although part of that was having a Roth IRA from even before I’d started graduate school. Um, and like you said about, uh, benefits to stress and wellbeing, I think that’s a very strong part of it as well. Uh, by having enough of an emergency fund, uh, saved up that you can do these sorts of strategies and have money to contribute for, uh, 529s or bank bonuses or whatnot, um, and having enough extra money like that beyond your monthly living expenses is really a source of stress relief. Uh, it’s nice to know that uh, if something unexpected comes up, I’m not gonna be unable to pay my bills that month. You know, and there’s circumstances where, you know, for instance, one point in graduate school, both my parents injured themselves within a few days of each other and I flew out, uh, to help take care of them. And you know, having enough money that you can just book a last minute, uh, flight without having to, you know, be unable to pay your bills, uh, is really a source of stress relief

Emily (43:40): About the cost question. Like how much time would you say you spend doing the stuff? Like per week or per month?

Kyle (43:45): Really not that much, I would say. Um, a lot of these things, especially over time have gotten better at optimizing. Um, you know, in terms of like contributing to a 529 plan and stuff like that. Um, you know, once you’ve got it set up, it just takes a few minutes to say, you know, transfer a thousand dollars into this account and then just put a reminder on your calendar to do taking it out next week. Um, so some of these are pretty low effort. I would say that the bank bonuses and credit card bonuses take a lot more time and that’s something that I’ve not been doing as much lately, especially as I’m trying to finish up my dissertation. Um, but it’s something that, you know, was a nice extra source of cash here and there, there, and you can kind of devote time flexibly to it depending on if you’ve got extra time to look up if there’s any good signup bonuses right now. Um, but then since you’re not depending on that income, if you’re don’t have the time or don’t wanna deal with it, then you don’t have to.

Best Financial Advice for Another Early-Career PhD

Emily (44:47): Yes. Oh, such a wonderful position to be in. Thank you so much for sharing all of the things that you’ve learned and tried out and, you know, found what works and what didn’t for you, um, over the course of your time in graduate school. This is really amazing. I really hope the listener is gonna take away at least one thing to experiment with <laugh>. Um, so let’s wrap up with, um, my final question that I ask of all my guests, which is, what is your best financial advice for another early career PhD? And it could be something that we’ve touched on in the interview already, or it could be something completely new.

Kyle (45:14): Yeah, if I had to sum up everything that we’ve touched on in this interview, it’s that things that are small amounts of money here and there and just a few percent of recurring things, uh, really add up over time. Um, that by saving a few percent off your living expenses, having your emergency fund earn a few extra percent, uh, per year, um, saving a few percent on your taxes for money, that’s gonna grow a few percent every year until you retire. Um, these things when combined, uh, really start to add up and let you, uh, get to a place where you have enough money that you have more financial stability and more flexibility, uh, to do the things you want. Um, and really a lot of it comes from having enough of an emergency fund saved up that you can do these sorts of strategies. Um, so especially anything that you can do to save up extra chunks of change if you don’t have an emergency fund. And then once you get to the point where you, you know, got four or five months of your living expenses you’ve saved up in the bank, you can start to play around with some of these other strategies to let that money snowball.

Emily (46:18): Wonderful. I love it. Thank you so much, Kyle, for volunteering to come on the podcast.

Kyle (46:23): Yeah, of course. Thanks for having me.

Outtro

Emily (46:34): 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 Former Prof Found True Flexibility and Profitability in Her Academic Editing Business

December 2, 2024 by Jill Hoffman Leave a Comment

In this episode, Emily interviews Dr. Paulina Cossette, a former professor and the owner of Acadia Editing. Paulina followed the prescribed academic path, but found herself profoundly unhappy in her faculty position. After leaving academia, Paulina stumbled into academic editing and eventually started working under her own brand. As a business owner, Paulina earns more, works less, and has true flexibility, which has enabled her to design her lifestyle in a way that was not possible within academia.

Links mentioned in the Episode

This Former Prof Found True Flexibility and Profitability in Her Academic Editing Business

Teaser

Paulina (00:00): The system makes it unsustainable, particularly if you have kids, though, not exclusively. Um, and so I think I just reached a breaking point, you know, and, and it really wasn’t planned.

Introduction

Emily (00:24): 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 (00:53): This is Season 19, Episode 8, and today my guest is Dr. Paulina Cossette, a former professor and the owner of Acadia Editing. Paulina followed the prescribed academic path, but found herself profoundly unhappy in her faculty position. After leaving academia, Paulina stumbled into academic editing and eventually started working under her own brand. As a business owner, Paulina earns more, works less, and has true flexibility, which has enabled her to design her lifestyle in a way that was not possible within academia. If you’ve been enjoying this podcast and want to see it continue, would you please help spread the word? Take a minute to leave a review on Apple Podcasts or Spotify, text a recent episode that you enjoyed to a friend, or give it a shout-out on social media. Any of those actions helps me to grow Personal Finance for PhDs and continue finding amazing guests for the interviews. You can find the show notes for this episode at PFforPhDs.com/s19e8/. Without further ado, here’s my interview with Dr. Paulina Cossette.

Will You Please Introduce Yourself Further?

Emily (02:15): I am delighted to have joining me on the podcast today, Dr. Paulina Cossette, who is a former professor and currently has a business called Acadia Editing Services. I’m really excited to learn about her business journey, her exit from academia, all that kind of related stuff. And so, Paulina, welcome to the podcast, and will you please introduce yourself to the audience a little bit further?

Paulina (02:36): Yeah, thanks so much for having me, Emily. Um, so I used to be a political science professor. Um, I was in academia for about 12 years, uh, and in 2019, um, I had a 1-year-old child and I was just sort of, uh, very overwhelmed, um, and getting fed up with the lifestyle of academia, having to work seven days a week, you know, just facing that burnout, especially having just had a baby. Um, and so I decided to quit and we moved aco- across the country to live in Maine near our family. And I sort of fell into copy editing. And, you know, long story short, uh, four or five years later, here I am, I have a successful editing business and I work from home for myself. Um, and life is good.

Emily (03:28): I love this concept. Okay. Are you familiar with Cal Newport?

Paulina (03:32): Yes.

Emily (03:33): Okay, so I’m gonna get his like, name of this wrong, but it’s like lifestyle centered career design, something like that. Have you heard him talk about this lifestyle centric career design? Something like that? Um, so that really sounds like, I mean, you said you fell into it, but it, I mean, it really sounds like that’s kinda what you were doing, right? You had built up career capital in academia and then said, Nope, my lifestyle is more important than this particular job, and so I’m gonna pivot and use this career capital in another area that supports how I want my full life to look like. Okay. So very, very great brief introduction, but let’s kind of dive, you know, more into this and sort of starting back from the beginning of the academic journey, like what led you into the career in academia in the first place?

Dr. Paulina Cossette’s Academic Journey

Paulina (04:17): So I, you know, I was always a good student. Um, I was a first generation college student, so I didn’t really have guidance on any of that other than my grandparents who were always saying, you have to go to college because that’s how you succeed. And I just, I liked school and I liked learning, so I just, I went to college, um, I kept, I just kept going and, you know, I started doing research, uh, as an undergrad and then went on to get a, the PhD program and I didn’t really have a plan, you know, I just sort of enjoyed being in school. And then once you get to graduate school, I think this is true for many people. Um, your advisors direct you towards academia and, you know, I was in political science, so there weren’t, there wasn’t any discussion of alternatives of industry or, you know, working in government or anything else. Uh, and I didn’t really know, uh, I didn’t know any other options. And, you know, they said, you apply to these schools and you get the tenure track job, and it doesn’t matter if you don’t like where you’re living, that’s just part of it, you know, you don’t have to stay there forever. And so I, I think like many people, I sort of fell into this funnel, you know, of like, this is, this is what you do, and I just did what I was told. And, um, it worked for a little while, but that was a recipe ultimately for disaster. So, um, so yeah, I, I loved school and I loved learning, but it was just sort of like, I, I just kept doing what I was supposed to do, uh, and ended up, you know, ended up there and not very happy.

Emily (05:56): Hmm. I wonder if I was on a track similar to this myself, um, up until the point in graduate school, um, when I discovered personal finance, actually. And that’s when I figured out like, oh, people have like all kinds of different jobs and businesses sometimes, and like some people work part-time and some people retire. And like all the, it’s just sort of opened my mind. And not that I was on necessarily an academic track, but certainly to stay in research, that was my intention. Um, so that is so interesting, and I totally, I totally understand how that would happen, but also good on you for being successful, even in something where you were like, I’m just following the prescribed path here. Um, but clearly it, it went well for you for a time at any rate. Right? And then you sort of, you know, briefly said earlier that the timing of you leaving your job was, you know, around when your child was very young. Is there anything else you wanna share about that decision to leave and like maybe what you thought you were jumping into next?

Paulina (06:52): Yeah, I think, um, it was a long time coming and I’m actually, I’m reading Annie Duke’s book Quit right now, where she talks about how we put off this decision to quit far longer than we should. Um, and it, it brings back a lot of memories. ‘Cause that was the exact situation that I was in, that I was so unhappy. And I thought, well, maybe it’s just the school I’m at. So I went on the job market and I changed schools, and I was, it was better, but I was still unhappy. It’s still, you know, and like I said, I I, I had my son. I was working seven days a week, and it was just, the system makes it unsustainable, um, particularly if you have kids, though not exclusively. Um, and so I think I just reached a breaking point, you know, and, and it really wasn’t planned. Um, my husband and I had talked for a long time about moving, um, his mom had been diagnosed with lung cancer. Uh, and so all of these factors were sort of playing on our minds until we finally reached this breaking point and said, you know, I said, I just can’t do this anymore. And it was the summer of 2019 and I resigned and we sold our house and we moved to Maine. And I had no idea what I was gonna do. I, you know, I thought I would go on the non-academic job market, trying to find something around here in Maine, which is not, you know, there aren’t a lot of options, um, trying to find remote positions. And I kept striking out, you know, people kept telling me I was overqualified or I wasn’t the right fit, or they decided not to hire anyone. Or like, it was, it was a really demoralizing experience, you know, feeling like, I have all this training and education, I’m smart, I’m hardworking, but nobody sees that, you know? And I think a lot of people go through that where they just don’t know how to translate the academic lingo into industry lingo, um, on a resume. And so I had just written a book and we had worked with a freelance copy editor in as part of the process of publishing it. And I thought, oh, well I could do that. I’m a really good writer. Everybody always tells me I’m, I’m a good writer, you know, I can edit. And so initially I thought it would be temporary, but I ended up loving it. And, you know, like you were saying about the lifestyle change, uh, this was shortly before Covid and then Covid happened and I thought, oh my God, I’m so glad I’m working from home. I’m so glad I didn’t take a job in an office. Um, ’cause especially with little kids, you know, I didn’t wanna be having to go off to work and then come home and potentially, you know, getting sick or something. So, um, yeah, so I really just fell into it, um, and ended up loving it, and everything has just grown from there.

Building an Academic Editing Business

Emily (09:45): Amazing story. And I, I mean, I think so many people in academia, whether that’s just as grad students or postdocs or whether that’s a career in the professorship type position after that can relate to this. I mean, there’s so many like academic exit stories like floating around in the last 10 years. Um, even on this podcast. It hasn’t been published at the time that we were recording this interview, but an upcoming episode is someone with a very similar story of having gotten that tenure track position and then just, it was not the right fit and ended up quitting, moving across the country, you know, familial reasons in the mix, kids in the mix, all that stuff, not surprisingly another woman. Um, so there’ll be echoes of that same like, motivation, um, between these two interviews as well. Um, and so I’m so glad that you found something that you loved, but it, it, it does sound like you are casting around and applying for different things and trying different things and, um, not sitting stagnant, but really like pursuing some different things until you found something that was an awesome fit. And I, I just love that. So let us know more about your business now, like, um, it’s been a few years since you like started it. So what does it look like now?

Paulina (10:47): Um, so when I first started out, I was very much a freelancer. The idea of being an entrepreneur was like, that’s too much for me. That sounds like a lot of risk. I could never do that. Um, and so I started out freelancing for some different companies that we usually refer to as editing agencies, um, where you have scholars from all over the world upload their documents and then the company hires you as a freelancer to edit them.

Emily (11:16): I worked in such a service as a side hustle for several years, yes.

Paulina (11:19): Oh, fantastic. So, you know that it is not ideal and the pay is not very good, but when you’re just starting out, it’s a great way to learn the business. You know, you are, um, it’s essentially, I tell my students it’s on the job training. You know, it’s if, if you’re faculty, you know how to do academic editing, um, but you’ve just never done it at the level that is required, you know, in professional editing, fixing every mistake using advanced tools and word track changes, all that stuff. And so I think working for these agencies is a great way to get that initial experience. And my mistake was that I just stayed there too long. You know, I didn’t have enough confidence in myself. Um, I saw other editors in these Facebook groups talking about how the way you make real money is to get private clients. And I thought, oh, I’m not good enough for that. You know, like the, the academic imposter syndrome carried over into this new life, unfortunately. Um, but eventually I got more and more experience and I decided probably a year or two ago, you know what, I’m just gonna go for it. And I started, uh, connecting with some private clients. And at first it was just a handful of people, but I, my confidence grew and I, and, and people were happy with my work. And so I realized that I really am good at this. And I think, you know, I wish it hadn’t taken me so long. Um, I did have a second child in that period, so I, I, you know, had other things going on. But, um, but yeah, I think I’ve, I’ve learned so much from building a business, you know, and, uh, a lot of it is just having confidence in myself. But a lot of it also is also that, you know, a lot of PhDs, um, think that they don’t have any skills that they can apply outside academia. I think they’re, they’re terrified to leave graduate school or their academic position because they think that they’re not gonna be able to do anything else. But there’s so much about a PhD or other doctoral program that trains you to be successful. You know, you’re hardworking, you’re persistent, you’re creative, you’ve got thick skin, you know, like all of this stuff. You’re a, a pretty good writer, probably. Um, you know how to do research, you like to learn new things. Um, all of this, no matter whether you wanna go into editing or business or, you know, industry or whatever, you have so many skills that you can apply elsewhere. And I think that the process of building a business has taught me that

Emily (13:55): I agree so much. I actually, right when I was, I guess around the time I started my business, which is also the time that I finished graduate school, I was kind of, yeah, I was trying some different things, sort of like you did for a little while. And, um, I, I remember writing a blog post about like, the similarities between like entrepreneurship and, um, the academic life. And in addition, all those, all those characters, which that you mentioned are totally, I totally agree with them. And I don’t remember if you had this in there, but I really focused a lot on like, sort of being, um, like a self-starter slash really in charge of your own work in an independent way by the time you finish a PhD. Or certainly if you go beyond that, um, very similar to being like a solopreneur or like the top person in like a business. Um, and also for me anyway, working alone. ’cause like I am a solopreneur, so I work with contractors, but I don’t have employees of my own. Um, and so that was also very similar to like, okay in, when I was in graduate school, like I had some collaborators, but I, I worked my own projects. And so like, not being part of a closely working together team was very similar to me between those two like environments. So yeah, I mean, and I actually, I really relate also to your experience of like, I’m gonna try this, um, mode of work first as like a freelancer. So working for somebody else’s business, whether as an employee or as a contractor, either way you would sort of learn what the business is and then eventually gaining the confidence, as you said, to strike out on your own and sort of do it under your own branding. But coming with that, uh, there’s much more responsibility for actually getting clients. So like, that’s the part when I was doing the freelance, like editing work, I loved that I didn’t have to get clients, I just had to do the work. Whereas when you become the business owner, like the sales aspect is something you have responsibility for. So that’s a tough, like, that’s a big role to like add when you’re making that shift. Do you have anything else that you’d like to add to that?

Paulina (15:45): Um, yeah, you know, what you just said about, uh, marketing and things being just a bit more challenging. And that’s exactly what I tell my students is like, it’s not ideal to start out working for these editing agencies that pay less, but it lets you focus on that training, uh, and, and really perfect your editing skills before you then go out and try to attract private clients. ’cause marketing does take a lot of work. It is, you know, I don’t wanna paint the picture that entrepreneurship is easy because it’s not, but um, it certainly does pay off when you get there, you know, and you figure out how to connect with people. And I think, um, I also agree with what you were saying about the similarities between being faculty or being in academia and being a solopreneur is one of the biggest things that I hear from people that they’re terrified to leave academia because they don’t wanna lose their flexibility. And I always push back on that because, um, I don’t think academia is all that flexible. You know, there’s a meme that’s gone around that says, academia lets you work, or you have to work seven days a week, but you can choose any seven days a week that you want. Uh, and it’s so true, you know, but being, being an in entrepreneurship, you, you do, you get to keep that flexibility and you’re not working nine to five.

Emily (17:03): Hmm. I agree. Like it might be a big shift for like an employee to then strike out on their own in a business, an employee in the sense of like, not in an academic setting where like maybe you work your 40 or your 45 or your 50 hours, but you can kind of turn it off and you don’t have a ton of responsibilities like outside of that. But in the way that academia can be all consuming business also can be all consuming. And so whatever skills you’ve learned about, like the boundaries that you can put up can, it can also be translated between those two settings. And like you said, academia is flexible in the sense of like, yeah, exactly. You are just gonna have a ton to do. So like, pick what you’re gonna do, all that ton of work. And, you know, business ownership is a little bit different because you can sort of define the scope a little bit better. Someone else isn’t defining it for you of how much work there is to do.

Commercial

Emily (17:47): Emily here for a brief interlude! I’m hard at work behind the scenes updating my suite of tax return preparation workshops for tax year 2024. These educational workshops explain how to identify, calculate, and report your higher education-related income and expenses on your federal tax return. For the 2024 tax season starting in January 2025, I’m offering live and pre-recorded workshops for US citizen/resident graduate students and postdocs and non-resident graduate students and postdocs. Would you please reach out to your graduate school, graduate student government, postdoc office, international house, fellowship coordinator, etc. to request that they host one or more of these workshops for you and your peers? I’d love to receive a warm introduction to a potential sponsor this fall so we can hit the ground running in January serving those early bird filers. You can find more information about hosting 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. Now back to our interview.

Personal Finances as a Professor and as a Business Owner

Emily (19:03): Let’s talk about the money part of this. So compare, you know, your job as a professor, what that paid and what it required of you to what you’re doing now. Like how have your, I’ll say, how have your personal finances changed with this transition? And there’s a lot of transitions in there. You mentioned, you know, multiple children moving across the country. Care, you know, caring for elderly parents. Like there’s a lot in there. So like how has your financial situation changed from when you had that previous position to, to now?

Paulina (19:30): So, um, with editing specifically, uh, so much of how much you can earn is based on how quickly you can edit because there are some editors who charge hourly, but I think that’s sort of on the way out. I think both editors and clients like to charge per word. So, you know, for each project you can give a quote, uh, based on your per word rate, you know about how much you’re gonna make based on your editing speed. The client knows what they’re gonna pay. And so, um, obviously the faster you can work while, you know, being accurate still, uh, the more money you can make. And so I think I am fortunate because I can edit pretty quickly, um, certainly as I’ve gotten more experienced. Um, and so I would say that, you know, my, I was making about $60,000 when I was a, an assistant professor on the tenure track in political science when I left, plus the benefits. And, you know, you, when you have a salary job, they’re contributing to your health insurance and retirement and all that, which you obviously lose when you go freelance. Um, my first year out of my first year of freelance editing, I made about 45,000, and that was working maybe 20 to 25 hours a week. Um, and you know, just kind of trying to figure out the landscape. Uh, my second year I made the same amount, but I took three months off because I had my daughter, uh, and wanted to take time for that. Um, and then within the last few years, it’s just climbed steadily, especially when I started working with private clients. And, you know, you’re not having to, you can charge much more. You’re not giving up those costs to some other company that’s employing you. Um, and this year I’m set to hit six figures. So, uh, and that’s only working about 30 hours a week. So, you know, there are a lot of editors out there who struggle with finding clients, but I’ve, I’ve somehow managed to find this formula that lets me, that has let me build up a client base with referrals and repeat clients and just new people finding me through Google or whatever. Um, and I’ve had a lot of success. And so, you know, I’m, I’m happy to share that with other people, uh, you know, to, to try to help them find their way out of academia.

Emily (21:52): Hmm. So it’s while not, and immediately upon that transition, it’s the business that you’ve built over time, I would say does compensate you well, more than, um, the academic position did, even after accounting for the benefits and so forth. And you’re limiting your work to 30 hours a week as you said, whereas it was whatever, 60, 70, whatever it was when you were in academia. Um, awesome. I’m glad to hear that both the up the upside of more money and less time both together. That’s amazing. Um, so when you volunteered for this interview, you said that you had a message for academics who are unsatisfied with their jobs like you were. So what’s that message?

A Message for Academics Who Are Unsatisfied With Their Jobs

Paulina (22:33): Um, I, if, if I could just talk to every unhappy academic, you know, I would say you don’t have to stay you if you are miserable. And you know what, if you are in academia and you’re happy, that’s fantastic. Uh, that that’s wonderful. But there are so many people out there who are unhappy and they’re terrified to leave for all the reasons we’ve been talking about, and they just feel trapped. And, you know, in the so many people that I’ve talked to in the last several months, um, you can see the anguish in their faces, you know, you hear it in their voices and, and I know exactly what that feels like. The anxiety, the stomach churn, the do I leave? Do I stay, do I leave? Do I stay? Uh, it’s horrible and I don’t want that for anyone, you know? And so if I could, if I could tell anyone who is unhappy, that’s, that’s my message is, you know, if you wanna go into editing, great. I’d love to help you get there. But, uh, no matter what you wanna do, um, you just don’t stay right. Life is too short to, um, life is too short to be unhappy and to not do what you wanna do.

Emily (23:40): Incredible. I absolutely agree. Life is too short. I’m, I’m 39 now, and so I am, I’m not having a midlife crisis, but I’m having a midlife like rethink, like, yeah, this, this is my life. Like, am I happy with the choices that I’ve been making? Most of them, yes, I am very happy. Um, what can I do differently? You know, going forward, what can make this an even better experience for me? Because you only get one life. And so to spend your twenties and your thirties and into your forties, maybe like as you just described, like dreading every day at work. Absolutely. Life is too short. Um, so totally agree. Will you please tell us more about like, well, one, where can, where can people find you if they want to, you know, employ your editing services? And I understand there’s another arm to your business actually, which is like helping other people make this kind of transition. So tell us about all that.

Get in Touch With Dr. Paulina Cossette

Paulina (24:31): Yeah, so for editing, um, my homepage is acadiaediting.com. Um, and you can also find me on Instagram, Facebook, uh, LinkedIn. Um, and that’s, that’s pretty straightforward. If you have an editing project, I usually just ask to see a draft and give a quote and happy to help whether it’s, uh, you know, a dissertation or journal article or even I’ve edited tenure packets and job market letters. Um, and then yeah, this summer I launched a digital course and group coaching program called Becoming an Academic Editor. Uh, we’ve just wrapped our first cohort. Uh, it’s a 12 week program and we’ve started our second cohort, um, so far over 20 people have gone through it. Um, and it basically, I teach you what I did, right? How to start freelance editing, how to build a website, how to find clients, um, and it’s really awesome because of that we do these weekly Zoom calls and you’re just surrounded by people who are just like you, who understand how horrible academia can be and who are ready to get started with, you know, like you were saying with that, that midlife change of, uh, really starting to pursue what makes us happy instead of what we feel like we were supposed to be doing.

Emily (25:52): That sounds incredible. And actually not to like whatever, get content out of your course, but when you described your transition, you left the job first and then you started and you found editing after having, after struggling to find another position. And so I would imagine what you’re teaching people now is, okay, you already have an idea that you might wanna edit. Let’s start that on the side before we quit the big job. Is that right?

Paulina (26:16): There’s honestly, there’s a mix of people. Um, some found me and I had one student who said she was in a therapy appointment and decided she had to leave academia and she went home and googled it and she found my website and enrolled in the course right away. Uh, other people have started editing on their own and are not having success. They’re struggling to find work, and so they find me and, and are able to get some help. Um, other people, yeah, they just wanna make some extra money, you know, they don’t wanna leave their academic job and they like that with freelancing. They can work five or 10 hours a week editing and bring in some extra cash or do it in the summer or whatever. Um, so it’s really, it works no matter what your situation is, as long as you’re a strong writer and you understand academic publishing, then you know, it’s, it’s totally doable for whatever your timing and all that.

Emily (27:10): I love it. Um, I’ll share that. Like I, when I was doing this kind of work, which I did for, I don’t know, maybe three years or so, four years, um, strictly as a, you know, contractor for another company, um, I did it as a side hustle and I started it after I defended as I was starting personal finance for PhDs and it wasn’t bringing in as much money as I wanted to bring in yet. So it was like another, it was truly like for the money, that’s why I was doing it. I didn’t anticipate having a career in this area or anything. Um, but when I started I was like, wow, I could have been doing this earlier, like I could have been doing this during graduate school as a side hustle. Like, um, and I liked that it was within, it was all within kinda my area of expertise and like that was really like nice that I still got to use those skills. Um, so I think at any stage, if you wanna pick it up and whether it’s gonna be a thing on the side or whether it’s gonna be like you are really doing this like for a lot of time and it’s gonna be one of your main sources of income, uh, maybe transitioning on to being your full-time income, like, that’s awesome. So I’m glad that people can find you if they’re curious about this career path.

Best Financial Advice for Another Early-Career PhD

Emily (28:09): Um, let’s wrap up with the question that I ask all of my guests, which is, what is your best financial advice for another early career PhD? And that could be something that we’ve touched on already in the interview or something completely new.

Paulina (28:22): So, um, so my biggest piece of advice I think is, you know, we all know we’re supposed to save and have a budget and all that stuff, but at some point, if you’re not earning enough money, enough money, you can’t save, right? I, I grew up with a single mom with not very much money at all. And so I know you, you just can’t save if there’s not enough coming in. And so for anybody who is getting their PhD and thinking about going on the job market, absolutely you need to negotiate. Uh, and I think this is especially important for women in particular who, you know, we don’t apply to jobs because we think we don’t, we’re not qualified. Um, whereas men will apply to any job that you know that they feel like they’re extra qualified for, even if they’re not. Um, so apply to jobs when you get an offer. Negotiate, right? Don’t be a don’t be afraid to ask for what you’re worth and, uh, let them tell you no, right? Like don’t, don’t assume that you’re not gonna get it and then be afraid to ask. Just go for it ’cause you deserve it.

Emily (29:25): Awesome. I love it. Okay, we’ll leave it there. Thank you so much for volunteering to come on the podcast. It was delightful talking with you.

Paulina (29:32): Thanks so much, Emily. It’s been fun.

Outtro

Emily (29:44): Listeners, thank you for joining me for this episode! I have a gift for you! You know that final question I ask of all my guests regarding their best financial advice? My team has collected short summaries of all the answers ever given on the podcast into a document that is updated with each new episode release. You can gain access to it by registering for my mailing list at PFforPhDs.com/advice/. Would you like to access transcripts or videos of each episode? I link the show notes for each episode from PFforPhDs.com/podcast/. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! Nothing you hear on this podcast should be taken as financial, tax, or legal advice for any individual. The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by Dr. Lourdes Bobbio and show notes creation by Dr. Jill Hoffman.

This Grad Student Channeled Her Financial Exuberance into Teaching and Coaching Her Peers (Part 2)

November 4, 2024 by Jill Hoffman

In this episode, Emily interviews Elle Rathbun, a 5th-year PhD candidate at UCLA. This is a continuation of a conversation started in the last episode. Last year, Elle shifted her financial education efforts into an official position with the UCLA financial wellness office, through which she delivered presentations and provided one-on-one coaching. Having a 75% position with the university required her to adjust how she managed both her time and money. Elle and Emily conclude the interview by sharing ideas for how the listeners can start helping their peers at their own universities with respect to their finances.

Links mentioned in the Episode

This Grad Student Channeled Her Financial Exuberance into Teaching and Coaching Her Peers

Teaser

Elle (00:00): Because I, I grew up with so much anxiety regarding spending and money that is, I, I think it was actually really good for my health, mental health that I sort of figured out where, where to cut, um, that anxiety from just because I needed to be able to save time in order to do my job, um, to do both jobs and get enough sleep.

Introduction

Emily (00:28): 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 (00:57): This is Season 19, Episode 6, and today my guest is Elle Rathbun, a 5th-year PhD candidate at UCLA. This is a continuation of a conversation started in the last episode. Last year, Elle shifted her financial education efforts into an official position with the UCLA financial wellness office, through which she delivered presentations and provided one-on-one coaching. Having a 75% position with the university required her to adjust how she managed both her time and money. Elle and I conclude the interview by sharing ideas for how the listeners can start helping their peers at their own universities with respect to their finances.

Emily (01:37): You’re probably listening to this podcast because you’re interested in improving your own practice of personal finance, and you want to learn the best PhD-specific strategies to do so. Well, you don’t have to listen through the entire episode archive to do so. Instead, go to PFforPhDs.com/advice/ and enter your name and email there. You’ll receive a document that contains short summaries of all the answers ever given on the podcast to my final question regarding my guests’ best financial advice. The document is updated with each new episode release. Plus, you’ll be subscribed to my mailing list to receive all the latest updates there. Again, that URL was PFforPhDs.com/advice/. You can find the show notes for this episode at PFforPhDs.com/s19e6/. Without further ado, here’s part 2 of my interview with Elle Rathbun.

Financial Wellness: Struggling with Motivation

Emily (02:47): I’m curious what you learned once you, or you said you had to get up to speed on student loans and so forth. That makes sense. Um, once you started talking outside of your like biosciences peer group, were there any, aside from the financial things you already brought up that were more like taxes and bureaucratic kinds of things, any financial patterns that you noticed or issues about the PhD community more broadly at UCLA? Like what were people struggling with or what, what do they have questions about aside from retirement, aside from taxes, aside from pay checks.

Elle (03:14): One of the main things was motivation. Um, and so this is mostly to speak about the wellness side of it, but it has a huge impact on the financial side of it. And so, um, people just didn’t seem, it’s really hard to convince someone to save for something that’s like 30 plus years out, right? And so, um, a lot of the people I talked with, um, they, they just needed to feel a little bit more motivated or they’re like, I know I need to start investing. I have no idea how. Um, but also I think credit cards were a huge aspect of it as well. Um, I think there’s a lot of misinformation, um, about how to pay off credit cards, um, and when to pay off credit cards. Um, and so, so I think credit card, like debt in general, um, and student loans, uh, as well as just motivation of how to get organized to the point that you then felt comfortable going forth and either paying off that debt or investing or just saving or just spending, um, certain things. And so there was that, there was also just what, what resources are available. Um, UCLA is phenomenal in terms of offering so many student resources. Um, besides financial wellness, we also have, uh, like loan services where you can talk about your student loans and figure out a repayment strategy, but student legal services was incredibly helpful to me when I was figuring out, um, some stuff with like my employment and, and the pay schedule and overpayments. Um, and, uh, so I think there are just so many resources that students are not necessarily aware of or they needed to be reminded of. And so just being able to point them in the right direction, um, was a huge thing that we talked about. Um, and it wasn’t a huge burden to me. I was like, oh, there’s an office specifically for that, and they’re much more capable of talking about that. Um, so I would just redirect them to there.

Emily (05:03): That’s one of those great advantages of being a student that you might not realize until you’re no longer affiliated with the university is like there are so many resources available to you and a lot of them are free or low cost because they’re designed for students. And yeah, once you exit the university system, you’re on your own and you have to pay for everything. So like, yeah, get all your checkups, your financial checkups, your legal checkups, whatever needs to happen, like before you leave the university.

Elle (05:27): Yeah, absolutely. And I will say also that there are people who before graduate school, whether they’re master’s program, uh, or PhD or what have you, um, they would, they worked right? They, a lot of them worked in the UC system. And so when I helped a, there were a couple people who I helped create a, a Roth IRA with, I would just, they would screen share or I would sit next to them, um, and they would see, because uc use- the uc system uses Fidelity as, uh, its brokerage institution. They would see a retirement account with like tens of thousands of dollars in there. And they’d be like, is that mine? And I’m like, yeah, that’s yours. That’s all yours. Um, this is the type of account it’s in. This is, these are some of the restrictions. Just know it’s there and know where it is and know what you could do with it. Um, and so that was actually really nice to see that, um, you know, a lot of people don’t necessarily pay too much attention to their withholdings and um, and things like that, which is totally fair. People are busy, but also, um, you’re, you’re paying into that for, for a reason. And so it’s already there. You may as well may as well know that it’s there and know how to use it.

Emily (06:30): That speaks to the power of pay yourself first, that you can literally forget that money was being removed from your paycheck for that, you know, great purpose and oh, discover it like free money later. You didn’t even, you didn’t even miss it. That’s the whole point.

Elle (06:44): Absolutely.

Working for Financial Wellness as a PhD Student

Emily (06:45): I’m also curious about the logistics of you working, um, for this office. And I understand you’re not working with them anymore, right? So it was maybe a nine month, eight month kind of period, right?

Elle (06:56): Yeah, uh, the beginning of November to the end of June.

Emily (06:59): Okay. Were you paid W2?

Elle (07:02): Yes.

Emily (07:02): Okay. And so how did this work with your existing funding or your existing stipend?

Elle (07:06): So my income was W2, um, for the first, when I first became employed through the Department of Neurology, which is the department my PI is associated with. Um, and so they would both appear, so I had to get explicit permission from my PI to sign off so I could have a higher percentage of effort. Um, so it was basically 10 hours a week or 25% effort for this financial wellness position. Um, and then I was at 50% effort for my graduate student researcher position, uh, with neurology. Um, and then things had to become rebalanced because that grant that I applied to did get funded. And so, um, so then I was partially had partial effort on, uh, for neurology. The 25% financial wellness remained the same. And then I was a certain percentage on my own grant, which was not W2. But now is.

Emily (08:02): Yeah, that’s the highest percentage I’ve heard of a graduate student going up to in terms of employment. So it’s not at all surprising to me that you had to get like the special permission and everything to do it. And then in terms of like your own work and your own time management, did that 10 hour per week that you were devoting to the financial wellness office, was that like over and above a 40 or more than 40 that you were already working?

Elle (08:22): Yes, very much so. Um, and so it is one of the things that I had laid out in that initial email to my PI requesting to, to be able to apply for this, and then eventually, if I got it, um, that he would sign off on this. Um, and he’s been nothing but supportive. He’s been phenomenal, um, in this whole process. Um, but one of the things I laid out was this is not a zero sum game. This will not take away from my time or effort in lab. Um, I am one of those people who the more things I have going on, the more productive I become. Um, and, uh, so, so I maintained many hours in lab, um, and that never faltered during my time. One thing that I had to come to terms with was I had to be okay with spending more. So I knew that if there was a way to save time in my personal life, um, even if that meant spending a little bit more, I had to take it. So I didn’t meal prep as often, um, and I didn’t drive out of my way to get the cheaper gas because that takes like 20 minutes. Um, and so, so there were things that I just had to come to terms with. Um, I, it was definitely a net gain. Um, I was paid $24 an hour for that position, and so, um, that added up in a month. But, um, because I, I grew up with so much anxiety regarding spending and money, that is, I, I think it was actually really good for my health, mental health that I sort of figured out where, where to cut, um, that anxiety from just because I needed to be able to save time in order to do my job, um, to do both jobs and get enough sleep, um, and serve as a mentor to, you know, my undergraduate students and a rotation student who is, um, uh, working on my project. Um, and just to make sure I wasn’t slipping in any ma- major areas, I had to be able to, to pay for saving time.

Emily (10:13): So this, tell me if you thought about it this way, but I guess the way that I would think about this is that despite the fact that it was associated with the university, you had to get the special permission you’re paid by the university and all of that. Essentially what you were doing is you had a side job, you had a side hustle, maybe you were doing it, you know, during your regular, what other people would consider their, you know, nine to five. You had permission to do it, but essentially it was a side job. And really what this is, is kind of a hobby that you decided to monetize, right? So like, it’s something that you clearly had been devoting time to before that point on a volunteer basis, and then you switched at least some or maybe all of that effort into this paid position. Um, and so it absolutely makes sense to me. Like it’s essentially like you took on a side hustle, right?

Elle (10:56): Absolutely. Yeah.

Emily (10:57): And then the other thing that I’m thinking about this is that, um, just what you were talking about there of like making the decisions of like, okay, I need to manage my time a little bit differently. I need to manage my money a little bit differently because I had this extra position. Probably all the work that you’d been doing in YNAB and everything really helped you make those decisions because you already had a really good perspective on what you’re spending, how you were managing your time and so forth. And so it was probably very easy for you to make decisions about what you could shift now that you had more money, but a little bit less time.

Elle (11:27): Yeah, it did. It made me, I, I sort of looked at my budget and said, okay, um, if I didn’t meal prep, how much would I spend on eating at the hospital cafeteria or, uh, getting something from the store or, um, just, you know, going somewhere else and, and dining out. Um, and so, so I knew exactly how much I was comfortable increasing my food budget, my gas budget, um, and uh, I think those were the two main things. Um, but I also had to look at my calendar. So I think part of it is financial. Absolutely. And part of it was also where is this coming from in terms of time? So I stopped giving strangers advice on Reddit, <laugh>, that was one of the boundaries for me. I’m like, okay, um, I can still read stuff and still look for opportunities, um, and resources, um, but I’m gonna spend less time writing paragraphs. Um, so

Emily (12:14): I also had to create a Reddit boundary with myself because I loved it so much. I could not continue at all.

Elle (12:21): <laugh>. Um, yeah. And I’ve, you know, and after, uh, ending the position, um, that I, I sort of slipped back into that. Um, and so, but really figuring out where that time was going to be coming from was essential. Um, and just relying on every day I would just like wake up. I had no idea what I did the day before. I had no idea what I was doing that day. I just had my Google calendar tell me everything. Um, and so, um, so yeah, it was really, it was, it was very busy. Um, but I loved it so much. I don’t think there’s ever been another time or activity in my life where I felt like I was making such a huge positive difference in other people’s lives. Um, and so that was incredibly rewarding to me.

Emily (13:02): But you’re not with them now, right? Because I think you said

Elle (13:05): I’m not with them now

Emily (13:06): Sometimes, like the structure changed, but you, you ended the position basically last June.

Elle (13:11): Yes. So, um, I got my NRSA funded, um, and that started in 2024. And so the NIH has the stipulation that I can’t work more than 25% elsewhere. Um, and there was a little bit confusion around that. Um, I thought, great, I can, that’s financial wellness, 25%. Um, however, I’m at 21% effort with neurology. So essentially what it boiled down to is, um, if I had taken the financial wellness position for this coming year, I would be at 46%, which is significantly different. Um, and, and then, so, so I wouldn’t be able to take that position. Um, and I would still be able to continue it theoretically, um, if I was willing to, to decrease my neurology appointment. So essentially I would be paid less for the same work. ’cause I’m really working, um, for neurology no matter what.

Emily (13:59): Yeah, the PhD has to get finished.

Elle (14:01): Yeah, exactly. I’m like, well, I have no other choice. Um, but so that was, so that became the question to me is, uh, am I willing to essentially not get paid anymore to keep this position? Um, and because I had to make sacrifices in my life that cost more, um, I wasn’t able to, I decided against, um, against maintaining and keeping that position. Um, and so, um, I I’m so excited, like financial, well, they’re right across the street from my, my lab. Um, I told them I will be at their events. I’m still in touch with, uh, coaches in that office and with the director. Um, but, uh, in terms of can I do 10 hours a week for the next year, um, without additional pay? Um, the, the answer to that was no.

Emily (14:44): Yeah. And so I’m wondering, you know, you mentioned your Reddit usage came back <laugh> once the, uh, once the position ended. Have you made any other shifts to like sort of scratch this itch in the personal areas of your life? Like, are you back to chatting with your peers more like what’s changed?

Elle (14:59): Absolutely. Um, yes. So, um, I think my peers are tired of listening to me. Um, I do post a lot on our Slack. Um, we have a, I I created financial, uh, channel on our slack. So if there’s something that I discover, um, for instance, you can pay taxes with PayPal, um, <laugh>. And, um, uh, so, so that’s one way I scratched the, the, the NSID or the neuroscience and PhD specific itch. Um, I also started volunteering for junior achievement in SoCal, and so that’s more focused on educating, um, young people, so middle schoolers and high school students. And so that’s been incredibly rewarding. And I just started this summer, um, because I knew I, this, there is an itch to scratch and their headquarters are fortunately really close to where I live. Um, and so, uh, and so just doing a lot of like, work in the community, um, and, and talking to individuals and sort of just always being open. I like if I’m introducing myself, um, not necessarily the first thing I say, but also it’s always, it’s a huge part of my identity in that like, I have a passion for personal finances. And so, um, and so I just have friends who aren’t associated with the university at all, who are then open to budgeting. I have friends who do a lot of like freelance work in the entertainment industry, and so I talk about YNAB with them. Um, and so I think just sort of putting myself out there, I I, there are things that I don’t need to share. I don’t need to share what, what banks I bank with or my net worth or anything to have a, have a good discussion in that like, oh, I love my budget budgeting software, or, oh, I have so many thoughts about student loan repayments, um, and things like that. So yeah, just putting myself out there and, and doing more work in the community, but on a more flexible schedule and timeline.

Commercial

Emily (16:46): Emily here for a brief interlude! I’m hard at work behind the scenes updating my suite of tax return preparation workshops for tax year 2024. These educational workshops explain how to identify, calculate, and report your higher education-related income and expenses on your federal tax return. For the 2024 tax season starting in January 2025, I’m offering live and pre-recorded workshops for US citizen/resident graduate students and postdocs and non-resident graduate students and postdocs. Would you please reach out to your graduate school, graduate student government, postdoc office, international house, fellowship coordinator, etc. to request that they host one or more of these workshops for you and your peers? I’d love to receive a warm introduction to a potential sponsor this fall so we can hit the ground running in January serving those early bird filers. You can find more information about hosting 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. Now back to our interview.

Writing a Book About Lessons Learned During Financial Coaching Sessions

Emily (18:02): So I see a lot of, um, parallels with my situation when I was in graduate school, um, engaging in many of the same activities. Um, what I was doing at the time was blogging about personal finance, because blogging was a thing back then, um, 10 plus years ago. So I think because I had this blog and it wasn’t like anonymous, like I would, you know, link to it, you know, on like my personal, like social media page or something like, and I would talk about it with my peers too. I was open, it was clear to other people that I was open to talking about this stuff because I talked about it on the internet. Um, now fast forward, you know, we’re in 2024, blogging is not so much of a thing now, but, uh, creating social content is, so you’ve talked a lot about creating actual in-person face-to-face connections, you know, with your peers and with the, the people you’ve met through the financial wellness office, and that’s amazing. I’m wondering if you do any content creation or if you’re interested in that, um, sort of for the wider internet.

Elle (18:55): Ah, great question. I am actually writing a book, um, which is nowhere near, uh, being ready for a manuscript or anything. Um, but something that came up as, uh, a QuestBridge scholar and a PhD student is that a lot of people just need to know where to start. Um, and I, I think a lot of people, and probably a lot of listeners know like, okay, I know I need to invest. I know I need to save, I know I need to pay off debt. Um, but it’s really hard to know what order to do things in, um, and to feel comfortable in whatever you pick. And so, um, I’m sort of putting together lessons that I’ve learned for, from those coaching appointments, um, into a book that will hopefully be available for very, very cheap or free, um, and, and sort of putting that together in a more synthesized, very thoughtful way. Um, I do avoid social media, um, just for my own like mental health and benefit. Um, Reddit is really as far as I go, Reddit and LinkedIn. Um, but I’ve never really like posted on LinkedIn, um, except for like one review article that I wrote. And so, um, but yeah, so I, I do want to have like a choose your own adventure book. Um, hopefully physical, but maybe just published, um, as an ebook as well. Um, and that’s sort of the brainchild of conversations I’ve had with, with fellow QuestBridge students and with the founder of QuestBridge as well. So they’ve been hugely supportive even after I’ve long graduated from undergrad in, in helping alumni try to figure out where, where to go from here. Like, okay, great, you have, you started your new job, um, now what? And, and I think it’s, that’s not, that’s not a unique situation for people to be in. I think that’s very widespread. So, um, yes, uh, that, that will eventually come out. Um,

Emily (20:37): I’m so glad to hear that my question was not a suggestion, honestly, <laugh>, because social media can be, as you already know, because you’re not really using many forms of it, um, such an incredible, uh, time suck. And it also doesn’t necessarily, some people can blow up from it and, you know, make it their whole thing or their whole business or whatever. But I think because you have this other career <laugh> that you’re pursuing, um, a book is an amazing like, place to put all of your like thoughts and knowledge and, and observations and what you would guide other people to do. And it’s such a, I I’m a reader, like I love consuming books. And so I just think it’s a wonderful format, like for teaching, and you can obviously have a great teaching experience through a book and not have it take over your entire life <laugh> the way that social media can. So I actually really love like the balance of your striking, and you obviously need to strike that balance because we’ve talked about the time management, like you can’t be on socials like all day long because you have so much to do. Um, so I’m, I’m really, I’m really glad to hear that and I would love to, you know, when it’s finished, like I’ll help promote it, like let me know, you know, podcast listeners I’m sure would be interested in, in seeing it as well. So that’s amazing. I’m really glad you’re working on that project.

Elle (21:42): Thank you. Yeah. Um, I’m very, I’m very excited about it and I think I, I, in terms of content creation, I do do it like I do investing. I set it, forget it. Like I don’t want to have to maintain something, um, because I know that it’ll just always be omnipresent. Um, and, and so I would like to focus on, on my research, um, but I absolutely want to to sort of, uh, compile everything that I’ve learned and, and put it out there because I’m gonna do it anyway. Um, may as well be something that’s accessible.

Supporting Financial Institutional Knowledge at Your University

Emily (22:12): Yes. I’m so glad to hear that. Maybe there are some other listeners to the podcast who, like you listening for a long time, you know, got really excited about personal finances, wanted to, you know, read the books. Consume other <inaudible> Learn a lot and they have a lot of insight into how things work at their university in particular, and all the idiosyncrasies that go along with their, their own experience as a graduate student at their university. Um, do you have any suggestions for listeners on how they might do some of the things that you’ve done or similar things, just how to help their peers because they have so much of institutional knowledge and how can they pass that on?

Elle (22:47): Yes. Institutional knowledge is the first phrase that popped into my mind. So, um, do whatever is sustainable and if there’s one particular person who’s driving this, um, or one particular person, for instance, like a student affairs officer who will be at the university for a long time or even a professor, um, if they are okay with just like owning a Google Drive, that’s really what my resources are. They’re just all in a Google Drive. I can share it with anyone, it’s publicly available. Um, people can share the links to it. I don’t care if anyone from outside of UCLA sees it, it’s great. Um, but sort of just, I think whether it’s an individual effort or a group effort, just start. Um, so if you give a presentation, um, even if it’s 15 minutes of how to sign up for direct deposit or how to enroll in your university’s retirement plan, et cetera, um, just write it and just put it somewhere. And I think once you have somewhere to put it, then it makes writing it even easier. And a lot of the content I’ve created and a lot of the resources I created took me maybe an hour, sometimes less, sometimes a little bit more, but just having a place to stick it where it could be organized. Um, and then I can create copies of, for instance, I create copies of my managing finances presentation for orientation every year and I edit it. Um, but it always just gives me a launching point. And so, um, finding a place to stick that institutional knowledge and then just, just doing it or hosting a conversation, um, creating an outline of, um, of what you might wanna talk about with your peers. Maybe there’s a question you don’t know the answer to that, um, that maybe just a discussion with a few people who are older or have been in the program longer, um, that they can answer, I think is, is huge. Um, so few people know exactly what they’re doing, <laugh>. Um, and so I think the more we talk about it, especially with people in similar situations with us as us, um, are are is incredibly useful just to have those conversations and then, you know, someone can just take notes and then stick it in whatever Google drive or box account, um, that they have. But, you know, it’s, it’s surprising how quickly those resources build up once you just dedicate yourself to, okay, every time I have a discussion that’s a little bit more structured, every time I have a presentation that’s a little bit structured, um, this is where I’m going to put it, um, I think is useful. Even if that’s like a, something that’s pinned on a Slack channel, which is currently what mine is. <laugh>. Yeah,

Emily (25:13): I think that makes so much sense. Um, especially the part about like where you started, which is to find like a sponsor who’s going to, whose tenure at the institution is gonna last longer than any one individual graduate students. Um, I love the idea of asking a staff member or a faculty member to house that, um, so they can for, you know, years and so to speak, generations of students to come can keep pointing to it. Another suggestion to throw in there is to maybe involve a student organization, like your graduate student organization in your school or your university or even at the departmental level, if that’s where you went to start, like that’s where you started. Those institutions, although the people change, the group itself stays on for, you know, decades. And so that could be another place too, how these kinds of resources, and I love that the way you phrased it as like, um, sort of a collaborative effort. Like yeah, you might be creating some resources or having some conversations, but also if you make it known that this is the place where these sorts of things go, other people can create them too. Anything they learn can go in there. So our episode from season 18, episode three with Dr. Carolina Mendoza Cavazos, she talked about, again, this institutional knowledge, um, and how it built up with her over time, very similar to the story that you’ve told as well, like some of those weird things about pay schedules and, you know, tax withholding and all this stuff. Um, so, so practically useful and yet until you’ve lived through it, you don’t know that it’s coming. So like, yeah, just a place to house these resources so that people can get prepared for that month or two where they’re not gonna have paycheck, which is so scary. Or like with, which I talked about with Carolina, like lapses in benefits if you don’t handle like a transition between funding sources properly, like just giving people a heads up that stuff is coming is so, so important. So I love this idea. Thank you so much for suggesting it. Um, anything else on that topic of like how people can help their peers if they’re excited about this topic?

Elle (26:56): Um, I think if you don’t have a financial wellness, uh, program or office at your university already, I think talking with administration, whether that’s, um, of your program or even higher, um, the, the way financial wellness at UCLA was started is like 10 years ago. Um, student feedback was, please give us a resource that where we can learn about things like credit, like credit cards, we’re getting this great education, but also there’s things in our daily lives that we need to know that we currently don’t have a great way of learning, at least through the university. So, um, if your financial, well, if a financial wellness office exists already at your institution, I think just going and seeing what resources they have. Um, I didn’t know that financial wellness created all these workshop presentations that are publicly available, um, to anyone even outside of UCLA. And, uh, so just seeing, seeing what resources they have, um, getting involved, if it’s also a passion of yours, um, which I’m sure a lot of listeners of this podcast it might be. Um, but if it doesn’t exist, if that office doesn’t exist and that resource doesn’t exist yet, make it known that you want it and, um, you’re definitely not alone in that. Um, I think just having a lot of names on a letter could at least get the ball rolling for those future generations of students because it worked at UCLA. Um, and I think it’s sort of, uh, continuing across the country as more and more financial wellness offices and programs pop up and, and start really helping students in a way that really matters.

Emily (28:25): Yeah, so I’m part of this, um, community, I guess called the Higher Education Financial Wellness Alliance, and it’s, it brings together financial wellness professionals from universities and colleges across the country. So when I attend like their conference, it seems to me like everybody has a financial wellness office. Maybe that’s not the case, but I will tell you that a lot of universities have financial wellness offices. It’s just that they might be focused on the undergraduate population. Now at UCLA, it sounds like they had like a position for like a graduate student, you know, two, two graduate student peers, um, peer counselors at a time, which is amazing. I’ll tell you that that’s not common. But the more and more graduate students who go to their financial wellness offices and say, we want these resources, and by the way, we want them tailored to our specific situation because it is different than an undergraduate situation. Um, the more and more they hear those requests, they will try to meet them, um, eventually <laugh>, but I think right now a lot of these offices don’t see graduate students ever. And so they don’t, it’s like the two popula-, they’re just not talking to each other, right? It’s not that graduate students don’t need this information, it’s just that they’re not going to that specific source and asking for it, but they should. So yes, I agree.

Elle (29:33): Amazing. Yeah, I think if you, if you never speak up right then, then um, it’s great to have, yeah, one Google Drive folder housed by like a professor, but, um, think about how great it would be to yeah, expand, uh, a university’s financial wellness program to include or be more inclusive of, um, graduate students. I think there’s always going to be work to be done, but um, I think it needs to start with, with a voice.

Best Financial Advice for Another Early-Career PhD

Emily (29:55): Awesome. Okay, well let’s end with the question that I ask all of 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.

Elle (30:09): Yes. Um, I thought a lot about this, um, because I knew the question was coming. Um, but I think, you know, there’s, there’s of course the, the starting a Roth IRA and budgeting, but I think the main advice I would give is to make time. Um, I think it’s so easy to put off something because this is sometimes scary for a lot of people. If you’ve never invested before, if you’ve never even heard of something, um, just make time, set a schedule maybe for me, I set aside two hours every week where I focus only on, or sorry, two hours every two weeks to focus on only my finances. So I pay off my credit cards, I check my credit report sometimes. Um, and, um, I, I look at, I update my net worth tracker, I look into if there’s a credit card that might have a good bonus. Um, I sort of see where I am in terms of my budget and my, my goals. Um, and then I also look at like potential investing opportunities. My, my investing is strategy is pretty set, um, and that I don’t want to really touch it, but, um, but when I was first starting, I think just making myself make time for it and then dedicating only those like two hours of just educating myself, figuring out what an index fund is, um, what, what I wanted to do, uh, in, in terms of like tax strategy, all that stuff, paying taxes, et cetera. Um, I think make, it starts with, with making time to do it, um, and not putting it off.

Emily (31:39): I love that piece of advice. Some people call this a money date, um, a recurring money date that you have by yourself or with your partner or whatever your applicable situation is. Um, I would also add in there like, I mean, all the things that you listed are things that, um, you can do either every time you have the money date or maybe they’re sort of seasonal or occasional. Um, but I would also add in, uh, consuming content. So like maybe that’s okay, I have two hours set aside every two weeks and it took me 75 minutes to do my tasks and I have another 45 and I’m gonna read a book, or I’m gonna listen to this certain podcast, whatever, just to like further that. And I, I love that, you know, keeping that space on the calendar, you obviously, um, do block scheduling with your calendar time block planning. Um, so that’s like an amazing way to do things and just to have that protected time because then if something does come up in your financial life, like I had something come up recently, which is that, um, my 401k provider is no longer my 401k provider. They ended the program for everyone. So like, I had a lot of administrative things to do to like, get this 401k moved elsewhere. And so just having that protected time on your calendar is great when something like that comes up because you can sit, you don’t have to steal time from, you know, some other aspect of your life. It’s already recurring there. So I really love that suggestion. Um, Elle, thank you so much for coming on the podcast, spending this time with us. I hope the listeners really enjoyed this episode, got a ton out of it and are inspired like I am to continue the work. So thank you again.

Elle (32:58): Thank you so much. Yeah, it’s, I’ve, I’ve been hoping to come on this podcast for so long and I was just always like, maybe I’m not ready, but, um, I hope, yeah, I hope this is useful to your listeners and thank you so much for having me. I, I really had fun.

Emily (33:09): Awesome. And a note to the listeners. Yes. So Elle and I happen to meet each other in person and I said, why do you not come on the podcast? Like, let’s make that happen. And as she just said, she’d been waiting and waiting, waiting to volunteer and yeah, there’s never gonna seem like a perfect time. Your story is done and whatever. Just go ahead and volunteer pfforphds.com/podcastvolunteer. That’s the form you can go and fill out and uh, I would love to have you and have another wonderful conversation like the one we just said. So yeah, I hope uh, more people volunteer and more people will take up the mantle for what you’re doing as well.

Elle (33:38): Absolutely. Thank you so much.

Outtro

Emily (33:50): 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.

Navigating the Career and Financial Transition Out of Academia

October 7, 2024 by Jill Hoffman 1 Comment

In this episode, Emily interviews Dr. Jill Hoffman, a former assistant professor who left academia to become a stay-at-home parent and part-time business owner supporting academic entrepreneurs (including Emily!). Jill recounts how she decided that academia was no longer the best place for her and how she and her husband planned out how to swap roles as the stay-at-home parent and move cross-country to be closer to family. One of the major themes of this episode is how to prepare financially and in your career for transitions. At the end of the interview, Jill gives not only her best financial advice but also her best advice for someone looking to leave academia and someone starting a side business.

Links mentioned in the Episode

Navigating the Career and Financial Transition Out of Academia

Teaser

Jill (00:00): There are different seasons of life. Um, I think this is a season where like the benefits of, of flexibility, um, with our schedule and our time, um, and having a low stress job, um, they greatly outweigh, um, having that second full-time income right now. Um, and I know that it’s just like this period of time, not forever.

Introduction

Emily (00:31): 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 (01:01): This is Season 19, Episode 4, and today my guest is Dr. Jill Hoffman, a former assistant professor who left academia to become a stay-at-home parent and part-time business owner supporting academic entrepreneurs—including me! Jill recounts how she decided that academia was no longer the best place for her and how she and her husband planned out how to swap roles as the stay-at-home parent and move cross-country to be closer to family. One of the major themes of this episode is how to prepare financially and in your career for transitions. At the end of the interview, Jill gives not only her best financial advice but also her best advice for someone looking to leave academia and someone starting a side business.

Emily (01:45): I’m looking for interviewees for Season 20 of this podcast! This is your official invitation to volunteer to be interviewed. I love that on this podcast I get to feature PhDs and PhDs-to-be who are almost exclusively regular people and learn and share their real-life stories and strategies. If it’s been in the back of your mind to volunteer, please go to PFforPhDs.com/podcastvolunteer/ and fill out the quick form, and I’ll be in touch over email. I look forward to interviewing you in the coming months! You can find the show notes for this episode at PFforPhDs.com/s19e4/. Without further ado, here’s my interview with Dr. Jill Hoffman.

Will You Please Introduce Yourself Further?

Emily (02:43): Today’s episode is a really special one because I have joining me today as a guest, Dr. Jill Hoffman. Jill is actually a returning podcast guest. She was originally on season three, episode four, and we’re going to use the interview today to just kind of like catch up financially and what’s been going on in Jill’s life overall, um, in the years since she gave us that prior episode. Um, to give you a tiny preview, Jill was a tenure track faculty member at the time of our last interview, and now she’s not <laugh> and she’s doing other things in her life, um, including working with me, uh, in personal finance for PhDs. So that’s what we’ve been doing together for the last about year and a half. Um, yes. So how did Jill get to this point? <laugh>. Um, Jill, please give us, um, a slightly longer introduction, um, and catch us up to where you were when we had that last interview.

Jill (03:32): Yeah, sure thing. So, um, I got my PhD in 2016 in social work. Um, and I worked as an assistant professor for six years. I quit my job right before or right when I was supposed to go up for tenure, um, which was two years ago, so 2022. Um, and then we moved back across the country to be closer to family from Oregon to Virginia. Um, and now, um, I am mainly a stay at home parent. Um, I’ve got one kid in preschool and one in elementary school, and my husband, uh, works full-time. And as you mentioned, um, we, we work together. I also have my own, um, small business providing virtual assistant services for online business owners, especially, um, academic entrepreneurs.

Financial and Personal Life Updates

Emily (04:14): So exciting. Let’s go all the way back to when you were on the podcast before. We talked a lot about student loans, we talked about public service loan forgiveness. Like let’s just kind of close that story first of all.

Jill (04:25): Yeah. So we have taken a, like student loans are on the, the back, back, back burner, um, right now since that time when we were really focused on student loan debt and kind of like figuring out what to do with it. Um, we, with all of the changes that have been going on with student loans, with like the save plan and um, with the covid pause and all those things, we just kind of said, all right, we’re, we’re not, nothing’s really happening with them at this moment. Um, we’re not doing anything with ’em. I got to a point in my, because I was doing public service loan forgiveness, um, I got to a point where I think I have like a little over a year left, um, and until I could potentially get them my loans forgiven. Um, but it, the trade off between staying in my job, um, and, and leaving it just for me personally, didn’t, the payoff wasn’t as, um, um, good as I thought it would be.

Emily (05:30): Anything else would you like to tell us about, you know, that maybe the time between our last interview and when you decided to leave your job?

Jill (05:37): A lot of things have happened, um, since that time and since kind of that when I decided to leave, two kind of big things happened. We had two like family emergencies that happened, um, since we last talked. So at the end of 2019, my dad unexpectedly passed away, and then my mom, um, had multiple major hospitalizations from like 2019 through 2021. And so those two things happened. Um, and then I had, in terms of like life events, not emergencies, I had another baby in 2021. Um, and so it was shortly after my dad passed away that we kind of were like, we’re too far from family. Um, we wanna move back to the east coast. We were on the West coast and, um, I don’t know that this is the job for me. Um, and so we kind of like used that time to figure out like, what do we, what do we do? ’cause we didn’t move until 2022 and I didn’t quit until 2022. Um, so we had a couple of years to like figure out what we were doing, um, in terms of next job, um, and, and where we were moving.

Emily (06:46): Yeah. I’m so sorry about your dad passing, especially unexpectedly, and I can certainly understand why that would cause you to rethink, um, what, you know, how you’ve set up your life and what you wanna be, um, doing with it. But obviously obvious to everyone who’s listening, like the decision to leave a tenure track job is huge. So tell us more about what was going on job wise that made you think wasn’t really the right job for you.

Jill (07:11): Yeah. I, there were a lot of different aspects to it. I think what it boiled down to was what, that I always felt like you have like the, the research, the teaching, the service, the three aspects of the job. And it felt like each of those could be a full-time job in and of themselves. And I felt like I could never do, um, like to the, like I was doing like a mediocre job at all of ’em, <laugh>, and it never felt like I felt like I was doing something unattainable, I guess. Um, and I was doing well and like, you know, I, um, was, had positive reviews, um, up until that point. Um, it just wasn’t, it didn’t feel meaningful enough for me to, to keep kind of working in a job that didn’t feel meaningful. I guess <laugh>, um, for, for me and the teaching aspect, there was a lot of teaching involved in my role and it wasn’t, that was never, um, why I got into academia. I really enjoyed the research part of it. And so, um, while I enjoyed like working with students, especially like one-on-one, um, and kind of like talking about career plans and things like that, I did not enjoy the teaching aspect and it just was so draining. Just like, I can’t, I can’t do this, um, for the rest of my career.

Emily (08:36): Mm-Hmm. <affirmative> and I remember, um, you had, or maybe still have a blog, right? Hmm. Toddler on the tenure track, and I remember that you, you’re into like time management and productivity and those kinds of things. And so obviously you put effort into your job and like trying to do your job as best you can, and you were intentional about that and you had tools at your disposal and so forth. And it, it’s, it’s very obvious to me that the job let you down, you know, like, you know that not the other way around. Right? Um, do you wanna say anything more about that?

Jill (09:11): Yeah, you know, I think the, the blog, starting the blog, um, was my way of like, trying to make it something that I wanted to do. Like it brought like some fun and meaning and like interest to it for me. And so, um, it was almost like, all right, I’m gonna figure out how to do this job in a way that like, allows me to really enjoy it. Um, ’cause how I’m doing it now is not, is not cutting it, I guess. Um, and so like by, I think just kind of like taking more time to reflect on like what I was doing, how I was doing it through the blog was a like my way of, of trying to figure out like, can I do this? Or is like, is this something that I wanna step away from?

Financially Preparing to Leave Academia

Emily (10:00): Mm-Hmm. <affirmative>. And so how did all this work financially, right? Because I also remember from the time of our last interview that I think you had your job but your husband wasn’t working at that time, right? So yeah. Talk about <laugh>, how, how the finances of leaving your position worked.

Jill (10:17): Yeah. Yeah. So this was like, we, um, so my husband was a stay at home dad for, um, pretty much the entire time we were in Oregon, which was about six years. Um, and we kinda slowly made the switch to him working full time and me being at home. When covid hit there were like whispers at my university that faculty might be furloughed a day a week. And I did the math in terms of like what income we would lose and it did not look great <laugh>. Um, and so my husband and I started kicking around the idea of him getting a part-time job, um, to, to boost our income if we needed that. Um, and uh, he ended up getting a, um, remote part-time, um, customer service job with Squarespace, um, that was like incredibly instrumental in helping us get across the country. Um, and just super helpful for making that actually work. Um, and so he started that job in like the fall of 2020. Um, and I can’t remember how many hours a week he was working. It wasn’t a ton, but we would, um, you know, as like most people that time like no childcare, so we would just kind of like switch off. Um, and I did a lot of evening, um, online classes and so, um, I would work in the evening and on the weekend and um, when he wasn’t working during the week, um, and then we’d like switch, um, child childcare or caregiving roles um, when I was done. Was not an ideal, like not an ideal setup. <laugh> as I’m sure lots of people know, um, but we knew it would, would be kind of temporary. I did not, um, end up getting furloughed. Um, so everything that he made, we threw into savings to save up for this move that, like, we weren’t at that time it was like, do I get a job? Do I get another job? Like do I keep my job and do it across the country? Like, what’s gonna happen? Um, but we knew that we likely wouldn’t have an employer paying for our move, so we were saving up for, it’s expensive to move across the country, <laugh>. Um, so we were kind of thinking towards that goal in terms of finances at that time, um, of saving up for this potential move the more like life happened. Um, with my mom being kind of in and out of the hospital and then having a baby and all these things, I was ju- I got so like burnt out and just like exhausted from life that I was like, I just need a break <laugh>, um, from like a, a higher stress career. Um, and so I made that decision to, to step away, um, just to kind of like let myself breathe a little bit, even though there’s like plenty of <laugh>, plenty of stress and all those things that come with caregiving, um, and taking care of family members. But um, not having the added stress of a job on top of that or like a full-time faculty job, um, felt a lot better to me, um, than than trying to stay or to move into another role.

The Two Income Trap

Emily (13:39): We’re going to continue with your story in just a second, but I wanna make an observation. Um, which is that there was this book that I read, actually my husband was assigned this book in college for some class he was taking, I read it afterwards. Uh, it’s called the Two Income Trap and Elizabeth Warren is the author or co-author or something like that. Um, and so it’s about how middle class families fall into what she calls the two income trap, which is we have two full-time jobs between the couple and our lifestyle consumes all of, you know, most all of that income. And so I see in your story, you and your husband intentionally avoiding the two income trap by if ever there was more than a hundred per- Yeah. Let’s say more than, um, one full-time job between the two of you. Like you said, that was going into savings. It was like an intentional like, um, uh, safety plan or like a backup plan, right? To get, have him get that part-time job when you had income uncertainty. And so at the point that one person has to leave a job or chooses to leave a job or whatever, then the other person, that couple can step up, take a full-time job and still be providing completely for the family because you’ve intentionally set your lifestyle so that only one full-time income is needed or something, you know, close to that. Um, so I just wanna make that observation. That’s very unusual actually, it these days. I mean, even since that book was published, it’s become more the case that people fall into and live in the two income trap because cost of living is so high compared to incomes. Um, so I just wanna make that observation and ask you like maybe how intentional that was from the finances side. I certainly understand why you would do it from like a lifestyle perspective, but how about from that financial perspective? ’cause your husband also has at least a master’s degree, right? He’s also like highly educated.

Jill (15:27): Yeah, yeah. He has a master’s degree. Um, I think the, I think when we first decided that he would be a stay at home parent, that was like a, definitely a financial decision there in terms of like childcare is so expensive. Um, and his, he has a master’s degree, but he’s in, um, his background is in counseling. Um, which not to say you can’t have a really high income with a counseling degree, but they’re not necessarily known for like super, super high incomes. Um, and so we figured that like him getting a job when I was working my faculty job, like most of that would be going to childcare, student loans. We don’t- rather him be able to spend, you know, his time with our kid, um, while I’m working, um, than be at a job and, and have our kid in in daycare. I’ve been budgeting for a long time in terms of like looking at what’s coming in, what’s going out. Um, and so we had a good sense for like what we spent in various areas and what we knew obviously what my salary, um, was. And when we moved to Oregon, he didn’t have a job so we were living on just my income and continuing to make it work. And so it stuck. Um, and we like the flexibility that it allows. I think we’ve just gotten so used to that <laugh>, um, that like, I think to have us both working feels like even though financially it would be really helpful, um, from like a logistical perspective, it just feels like, oh, I don’t, I don’t wanna do that. <laugh>.

Emily (17:14): Yeah. I remember thinking when my husband and I bought and moved into our house three years ago, it was the first time we were homeowners that there was just so much work to go around <laugh>. Like he works full-time, I work part-time and we have children and we have a house to take care of. My goodness, what is this? There’s just a lot of work to do and it’s, it is very, very helpful if there’s not in the mix two full-time jobs as well. Right. Um, so let’s pick up back with your story and about, um, you know, gearing up and for that cross-country move.

Financially Preparing to Move Across the Country

Jill (17:46): Yeah, so that, so we moved in 2022 when I, um, when I made the decision that I was not going to look for another job, my husband started talking to people at his work about like, can I, like how can I get to full-time? ’cause we knew that my benefits would not be around forever. Um, and so he was able to move into a full-time position in the, the same role that he was the same like customer service role, um, that he was in. This was like two months before we moved. It was kind of like last minute, last minute switch. Um, it was not, the pay was not great, but it got us benefits and we had a lot in savings. So we knew like we will be okay for a little bit, um, and we can do like a more, um, focused job search when we get to where we’re going if, if needed. Um, he continued to, um, look at open positions within his company and the month we moved, moved into another role with his company, um, higher paying, um, full-time remote position, which is where he is, um, current-, what he does currently. Um, and all of those things like allowed us to make all of this work without having to do too much like of a like major job search and, and um, like taking time off to interview and all these things like it since it was at his, um, employer already. And it was just really, really helpful. <laugh>,

Emily (19:26): Tell me about the cost of living difference between where you are in Oregon and where you live now.

Jill (19:31): Yeah, so in Oregon, um, we were in Portland, which is a high cost of living area. Um, and now we’re in Richmond, Virginia, which I was looking it up, it looks like it’s about average, maybe like a little below average, um, in terms of cost of living. So that was another really helpful move for us. Um, in terms of the house we bought here in Portland would’ve been like way out of our way out of our price range. Um, and so it’s just made some, some things possible that we probably, if we were moving back to like where I’m from in the DC area, I know you’re from there too. Like we wouldn’t have been able to <laugh>, um, buy a house probably at all the income difference. So when I was working as a professor, my highest salary, um, was just under 75,000 for like the 10 months. Um, so not super high. Um, we made it work. Um, and right now our total income is like a little bit above that, like 77,000. So that includes my husband’s salary, my part-time work, and then some interest income. Um, and so we have like roughly the same salary in a lower cost of living area, however, we’ve added one child, um, to our family. And so like we’re not saving anything right now. Um, and we’re not doing anything with student loans, as I mentioned. And I think it’ll probably stay like that until my daughter, my younger daughter is in kindergarten and I can add on like a client or two. Um, but I think like there are different seasons of life. Um, I think this is a season where like the benefits of, of flexibility, um, with our schedule and our time, um, and having a low stress job, um, they really outweigh, um, having that second full-time income right now. Um, and I know that it’s just like this period of time, not forever.

Emily (21:36): I, I think I’ve mentioned to you before, but I’ll say it for the benefit, um, of the listeners who have children or may want to have children in the future. But parenting wise, everything got so much easier. When our youngest got to kindergarten, like I felt like my whole world opened up <laugh> because they’re just so much more independent by that point and being in school and everything. So I can definitely see like just the lifestyle choices that you need to make, you need to make, to get through that like young child period. And like you just said, it’s not gonna last forever. Like things will be different in just a few years. Um, and so you can always make a different career decision. Either one of you can at that point.

Commercial

Emily (22:14): Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, budgeting, investing, and goal-setting, each tailored specifically for graduate students and postdocs? I offer 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. 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 institutes 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.

Starting a Business While Working in Academia

Emily (23:32): Let’s talk now about your business. Like why did you, um, start it? Was it primarily motivated by money or something to do with your time and your brain? Like, tell us how that got started.

Jill (23:44): The business has had like various iterations over the years. So when I was working as a faculty member, like my role was like community manager, um, for another person in the personal finance space, um, Jamila Souffrant with Journey to Launch. Um, and so I got a taste for like entrepreneurship, um, through working with her. I did that for about a year and a half. Um, and since that time I had like tried out a bunch of different things, just like curious about like, oh, there’s all these people making money online. Like it’s opened up a <laugh> whole new world. Um, to me in terms of like what it just broadened, I guess my perspective on making an income, um, and that it doesn’t have to be the traditional jobs that we, um, think of like doctor, lawyer, professor, all these things. So I kind of was playing around with various things. Um, on my way out of my faculty role, I thought perhaps I’d wanna do some like coaching for, um, faculty who are interested in like leaving their jobs. Um, and I used some of my professional development funds, um, to pay for some training, um, in that area ’cause it was like aligned with what I was doing too with students. So I was able to kinda make a case for using money for that, um, or my professional development money for that. But to like run a business, you also need to fund it. I needed more, um, money to like fund the business, um, that I didn’t want to pull from like our personal income. And so, um, as I was kind of thinking about how to do that, um, I think you emailed your list at one point, um, needing, needing support. Um, and this is after I left my my faculty position. You emailed the list, um, needing some support. ’cause you had somebody who had left and I was like, oh, that fits with, um, like what I, you know, the skills that I have, um, interests that I have, um, I’ll apply. And um, so we started working together and kind of since that time I’ve really enjoyed supporting, um, other like small business owners. Um, and I have moved away from the coaching. Um, I did that for a little bit, but really like I enjoy the, the supporting other entrepreneurs. Um, and so, um, right now I work with you and I have one other client, um, just provide-, like it depends on like the needs of the business. A lot of like backend support once my, I thought about adding another client. Um, and I think once my daughter, um, is in kindergarten, I think I’m, I’m setting my sights on, on that time for expansion. But I think right now, like two is a good <laugh> a good number for the amount of time that I have, um, uh, when my daughter is in preschool ’cause it’s not, not many hours a week <laugh>.

Emily (26:38): Yeah. Well this is, um, just a curiosity on my part because I know that the work that I ask of you is very seasonal. Um, so we have a really busy tax season and then less at the other times of year, but sort of variable from week to week and and month to month based on your interest in like productivity and everything like that. Like do you have any, I don’t know if it’s for me, but strategies for people who go through like busier and less busy, like periods <laugh>?

Jill (27:02): I think what I find at least for myself is like really, I think it can be easy to like try and force yourself to use like, uh, you know, whatever task management tool. Um, because other people are using it or like, it, it could be so easy to get into like, well other people are using this and they say it works. Um, I’m just gonna like force myself to do it. I think using what, um, works best for your brain, um, is helpful. So I just had like, I used to use notion a lot, um, which I still love for like my planning, um, and all those things, but I’ve been finding that like just I needed something a lot more simple. Um, and so now I just have like a notebook where I like keep track of things, um, and write things down and check them off. Um, and so I think really like don’t, if something isn’t working, try something else. Like figure out a system that works for you and your brain and that might change depending on like the time of year it is. Um, and, and what you’re doing. Um, but don’t like, feel like you have to force it to make it work. Um, ’cause that just makes it that much harder. <laugh>.

Emily (28:19): Yeah, I’ve been reflecting. So as you know, we use Asana, um, to keep track of tasks and I find that if I get really busy, I need to go outside of Asana and use paper. Um, because in a task management system like that, I mean, I could blame myself too. It’s not necessarily the tool, it’s the way I use the tool. Um, I find that like everything is given so much equal weight <laugh> when they’re all like different check boxes on the screen and I’m like, actually one of these is much, much, much more important than the other ones. And so the paper helps me clarify like, what are my real priorities for the day or the week or whatnot. Um, not just like, what is my task management software telling me to do? Um, and I think I’ve been listening to a lot of Cal Newport recently and reading his books and stuff, and I feel like this is the difference between, I can’t remember what he has, like some kind of name for it, but basically like checklist productivity versus like actual, like getting things that are important done, uh, productivity. So when things get really busy, I have to draw a distinction between those two and focus on, uh, what’s actually important versus what I’m, I’m being told to do by my software <laugh>. Uh, let’s leave with some words of advice then a little bit more advice than I usually ask my guests because the first sort of person I want you to think of is a person who’s considering leaving a tenure track position or maybe even just maybe even before that point, like someone who was going down that route and maybe is deciding to leave graduate school or not pursue a postdoc or just basically step off of the path that they thought they were on. Um, do you have any advice for, for that person considering a major career shift?

Advice for Major Career Shifts

Jill (29:48): I’m thinking about the things that were helpful for me that I did. Um, I think one of the main things was like creating a plan, um, both financially, logistically on what things could look like. Um, when you leave wherever it is you’re at. Um, I had so many spreadsheets, so many like notion databases of just like different iterations of like what me leaving my job could look like and where we would move would look like. Um, and I think obviously this, like, this will change depending on if you’re going into another job. Um, if you’re, you’re taking a break between jobs, if you’re staying at home, if you’re starting a business, um, if you’re moving, um, I think there’s like a lot of different aspects of that that when you create like a, a detailed plan as as detailed as you’re able to get, um, I think those things can become a little bit clearer for you when you have it all out, all out on paper, um, or the screen or wherever. Um, I remember my, when we were in the process of like our move, we would have move meetings like once a week, my husband and I of like, okay, like what are the things, like here’s this big goal, like what are the things we need to do to get it done? Um, that was very helpful. But, um, yeah, so I think those things were like intertwined, um, in, in this process, especially if you’re tenure track faculty, I can’t speak to like being a postdoc, um, and grad school, this might be a little bit difficult. Um, but I think using the resources that are available at your institution to help support you and figuring out what you wanna do next. Um, so I think I mentioned earlier, um, if you have professional development funds to use, is there a skill you wanna build? Um, do you wanna get some career coaching? Um, do some networking at a conference, buy some books. Um, I think using any and all of the resources that are available to you, if you’re able to kind of make a connection to what you’re doing in your job, um, and it’s relevant to what you wanna do next, um, I think it’d be a helpful way to, to find that extra support.

Emily (32:02): Yeah, we’ve heard that advice actually from several other interviewees on the podcast who have made, whether it’s like a grad student, you know, graduating and moving on to something else or a faculty member. I’ve, I’ve heard that numerous times. It’s, it’s kind of amazing that people can make those connections between what they’re doing now and what they think they’re doing next and, and get training that is supportive of both of those roles.

Jill (32:22): Yeah, yeah. Another thing, like another resource, um, I guess that was helpful for me. It was just like I asked so many questions of HR <laugh>, um, and this process just like hypothetical, like if I were to like quit at this point in my contract, like how long will my benefits last? And just kind of getting those logistical pieces that are helpful to know like, okay, my, my husband needs to have his health insurance, um, by this date because mine will no longer be in effect. And if that doesn’t happen, we need to get temporary health insurance and all those things. I think HR can be a really helpful, um, resource, um, if you’re comfortable like talking with them about potentially leaving. So like when my dad died and my mom was hospitalized, um, I was doing all the like estate settlement and then I was considering going back and helping with my mom’s care. Um, and then Covid happened, so didn’t, that didn’t happen, but I talked through with hr, like I think at that point I was kind of considering like, do I wanna quit or do I just need like a, a significant break? And so I talked with HR about like, can I use FMLA to go care for my mom? Like how can I take a break without actually quitting and doing the things I need to do? Um, and I didn’t actually use, um, FMLA for my parents, but did for, um, uh, when my daughter was born. Um, if, um, like family medical stuff is, is, um, any anyone is going through that. Um, I think they’re also a helpful resource to talk through, like what your options are. I think another thing that was so helpful for me is to seek out other people who have done what you’re trying to do, um, and talk to them if possible. I had a lot of Zoom conversations, phone calls, um, just to talk about like how did they, how they made it work, any tips they had. And honestly, just to like, I think when you’re still in the position, it can be, it could feel like impossible. Like, this isn’t ever gonna happen. I’m not gonna be able to find something else, or I’m not gonna be able to make this work. Um, so just seeing o- other people, other examples of, of doing the thing that you wanna do, um, and is so, so helpful. Um, and there are a number of, at least for like leaving academia, um, Facebook groups. Um, if you’re into Facebook, um, Academics say goodbye. The professors out, PhD mamas leaving academia, those were three that I, um, joined and kind of like, um, looked into as I was trying to make that, um, decision. And I think also related to other people like using your network, including family and friends, um, like tell them about what you’re wanting to do. Um, even if they can’t support you directly, they might know somebody who might be able to help you out in some way. Um, whatever it is. And so I think that helped a lot, just kind of like sharing this is what we’re, we’re doing. Um, do you know anyone might that might, um, be able to talk to me about X, y or Z?

Emily (35:36): It’s, it’s not surprising to me that you were able to find so many other examples, um, of people who had left tenure tech positions or those Facebook groups, for example. It’s just a little sad, it’s just a little sad that this profession, people make it their identity so that leaving and they make an academia makes it seem like it’s a one way street, right? You can never get back. It’s a permanent decision. So people put a lot of weight on the decision, right? Um, and yet it’s also such a difficult place to survive <laugh> that a lot of people want to leave <laugh>. Um, it’s not, it’s not everyone’s dream job as it turns out once you’re actually in it. So, um, but that is really, really great. I thank you for mentioning those groups specifically and, and the networking aspect of it. And yeah, there, we’ve had numerous people on the podcast too who have left academia, so I’m pretty sure including Jill, any of those people would be good ones to reach out to. Um, if, uh, you aren’t considering the listeners considering, uh, such a shift. Um, okay. Let’s talk about advice then for another type of person, which is, um, someone who wants to start a business, let’s say on the side, like part-time, the way that you’re doing right now. Um, and they could be at any stage in their career when they wanna do that. Uh, do you have any advice for that person?

Advice for Starting a Part-Time Business

Jill (36:45): Yeah, I think, I mean, I think a lot of the I things that I just shared are, are applicable to, I think also the, the networking and just seeking out other people. There are a lot of people, especially academics who, um, start businesses it seems. Um, and so talking to those people, um, and asking kind of the same, same thing, like how, how did you make this work? Um, or like listening, finding other podcasts that, um, where, where people are talking about kind of these, these types of things. I think too, like if you’re in, especially if you’re in, you’re in a faculty position, like it could be helpful to look at like your university’s policies on having a, um, an outside, outside employment. Um, I know my previous university, because I was in social work, so a lot of people like saw clients outside of, um, outside of our like faculty roles. Um, and so there was definitely language somewhere. I can’t remember exactly what it, what it said, but it essentially like, as long as, if you’re working like during work hours, like no more than eight hours a week or something can go to your, um, like outside business, um, or outside income. Um, and so it’s just making sure that like, honestly no one ever talked to me or asked me about it <laugh>. Um, but I think just so that, you know, um, what the university’s policies are, I think that can be super helpful to, to look into.

Emily (38:19): I noticed something, um, when you were describing the start of your business as well, which was experimentation, um, which I did too. And I think a lot of people who start businesses also do, uh, in terms of like businesses that like make it, maybe they become big or you know, whatever, it’s usually those entrepreneurs like third, fourth, fifth, seventh business, like, it’s usually not the first thing they’ve ever tried and they’ve had either failures in the past or just things they’ve abandoned along the way. And you didn’t necessarily abandon your business, but you just tried different things, different activities, different ways to make a money, different types of clients and figured out what you preferred. And I’ve done that too, even within like personal finance for PhDs, different ways of making money, again, different clients to work with different modalities and like figured out what worked best for me. So don’t, I guess for the listener, like, don’t be surprised <laugh>, if the first thing that you try is not the thing that you end up doing, um, after some time and it’s perfectly natural and, and should be experimented on because you’ll, you’ll find a good fit along the way. Um, it’s not necessarily, even though we were just talking about visioning and planning, like it’s not necessarily that your vision is gonna work out exactly the way that you thought it would from the beginning, but you can get to that point by just taking steps. So just getting started with something is the most, uh, the best thing to do.

Jill (39:30): Absolutely. And you learn so much throughout that journey. Um, I think, yeah, I feel like from where I started, I think I started with doing, um, online, like planning, yearly planning workshops for faculty and, and grad students. Um, and just have learned an incredible amount. <laugh> since those days are just like, oh wow. Like I, this is actually, people are actually paying me to do this. This is, it’s wild. So I think it gives you that confidence and then you learn like what you, like, what you don’t like, and, um, yeah, it’s a journey. <laugh>.

Best Financial Advice for Another Early-Career PhD

Emily (40:02): Yes. Um, okay. Well let’s wrap up with my official last advice question, which is, what is your best financial advice for another early career PhD? And that can be something that we’ve touched on in the course of the interview or it can be something completely new.

Jill (40:16): I think knowing exactly what is coming in and what is going out in terms of finances, um, at least for me has been so impactful. Um, knowledge is so powerful, um, especially about your finances. Um, it allows you to make more informed decisions. Um, and I think there’s something about seeing all that data, um, at least for me, it’s really motivating, um, in terms of like, you know, reaching savings goals or like seeing your retirement funds grow or it, I think it’s, it helps you, makes you wanna do it more. Um, at least I, I found that <laugh>, um, and I think like tracking those, like your expenses and income in a way that works for you. I know there’s like a ton of different budgeting apps and tools. I alway- I’ve used a spreadsheet, um, for a long time, um, and have tried out some apps, but just like I can’t, I always come back to the spreadsheet. Um, and so each year I start out with a new spreadsheet. Um, I have a tab for each month that looks at, um, what we spent, what we earned, um, that I’m updating on a weekly basis. And then I also keep track of like, um, savings, retirement, mortgage, student loans, um, on a monthly basis. Um, but that spreadsheet, um, has so much, it’s, it’s interesting to look at over the years and in preparation for this interview, I was looking back from like 2019 to now and it’s wild. Just like all the changes, um, that have gone on financially for us.

Emily (41:53): Yeah. And I think that the tracking, like you said, knowing your numbers, knowing what’s coming, what’s going out, um, enabled you and your husband to make those big financial decisions about jobs and moves and, and where to live and buying and all the things that have happened in the last few years. Um, because I think that people who sometimes people can get so, um, emotionally, um, intimidated by looking at their numbers that they don’t and they, it becomes an avoidant thing and then they become paralyzed and they’re not able to make those like bold decisions to change their lives because they just really don’t know what’s possible. They can’t do the visioning exercises, they can’t do the planning because they’re just not looking at the numbers. And so that’s just the first, the first step is really just to be able to like open that bank account, you know, um, you know, open it, look at the transactions, like look at the balances and everything and it all kind of like flows from there. Um, I was actually just listening to Ramit Sethi’s podcast. Um, I will teach You to Be Rich just earlier today, and the episode I’m listening to as so many of his episodes are the people he was interviewing, the couple, they were telling themselves a story about their money that was absolutely not true once you actually looked at the numbers. And it’s so clarifying to actually look at the numbers and the answers can come from the numbers. You just have to be like, brave enough to face, you know, the data and, uh, yeah. So I’m, I’m really glad to have this story from you, this example of how, um, your finances and your career and everything have all like played together and how you’ve been able to make those big decisions to do what works for you and your family, um, especially during the, the young kids season, the challenging time of life. Um, yes. So thank you so much Jill for volunteering to come on the podcast. It’s been lovely to speak with you, uh, in a different way than we normally meet

Jill (43:31): <laugh>. Yes. Yeah, thanks so much for having me, having me back on the podcast. It was fun.

Emily (43:36): Absolutely.

Outtro

Emily (43:36): 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.

Your Side Hustle Really Is a Business and Other Tax Insights with Hannah Cole of Sunlight Tax

September 23, 2024 by Jill Hoffman

In this episode, Emily interviews Hannah Cole, an artist and the founder of Sunlight Tax. Sunlight Tax primarily serves artists and creatives in their business tax needs, but there are many overlaps between artists and the academic community. Hannah and Emily discuss the best practices and insights that graduate students, postdocs, and PhDs with side businesses need to stay on the IRS’s good side. Hannah clarifies exactly when a business starts, the first step you must take with your finances, and how to calculate and pay your additional tax liability.

Links mentioned in the Episode

Your Side Hustle Really Is a Business and Other Tax Insights with Hannah Cole of Sunlight Tax

Teaser

Hannah (00:00): You know, we have a whole tax industry out there trying to, you know, its marketing is based around making us all hate and fear our taxes and actually kind of implicitly training us not to even look at it, to just feel so fearful. And so, like, hands off that we don’t even look at it. And I’m just here to say I hate that. I disagree with it.

Introduction

Emily (00:29): 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 (00:58): This is Season 19, Episode 3, and today my guest is Hannah Cole, an artist and the founder of Sunlight Tax. Sunlight Tax primarily serves artists and creatives in their business tax needs, but there are many overlaps between artists and the academic community. Hannah and I discuss the best practices and insights that graduate students, postdocs, and PhDs with side businesses need to stay on the IRS’s good side. Hannah clarifies exactly when a business starts, the first step you must take with your finances, and how to calculate and pay your additional tax liability. This whole episode is devoted to business taxes, but before we get started I want to ask you if you or your peers need help figuring out taxes on your academic income, your graduate student stipend or postdoc salary and the attendant benefits. Now is actually the best time to start the conversation with your graduate school, postdoc office, graduate student association, etc. about bringing my tax content to your university in the upcoming tax season—so that they have time to plan their budgets. In this upcoming tax season I’m offering live workshops that I will tailor to your university and state and also pre-recorded workshops that are widely applicable. I would be very grateful if you would issue a recommendation to a potentially appropriate host at your university. You can find links to more information from PFforPhDs.com/financial-education/. Thank you! You can find the show notes for this episode at PFforPhDs.com/s19e3/. Without further ado, here’s my interview with Hannah Cole of Sunlight Tax.

Will You Please Introduce Yourself Further?

Emily (02:56): I have a really special guest on the podcast today, Hannah Cole of Sunlight Tax. I have been listening to Hannah’s podcast, Sunlight, the Sunlight podcast for, I don’t know, definitely more than a year now, maybe closer to two. And she is an amazing, uh, podcaster and practitioner in her field because she teaches about taxes to her community. I’m gonna have her introduce her community to you, but I see a lot of overlap between Hannah’s community and our community of academics and PhDs and graduate students and so forth. So Hannah is really gonna be able to bring her insight into taxes and specifically self-employment taxes to our conversation today. Um, which is going to focus on self-employment situations that grad students and postdocs are typically in, which is like a self-employment side hustle. So Hannah, thank you so much for agreeing to come on the podcast. I’m really excited. Will you please introduce yourself a little bit further for our audience.

Hannah (03:48): Sure. Um, thank you so much, Emily. I appreciate it. Um, yeah, so I am an artist first. I, I went and got my MFA in painting. Um, and I have a degree in art history and, uh, started my life as a professional artist and was so upset at how I was treated by the world of accounting <laugh> by my dad’s accountant that eventually I, you know, went out to get the information on my own. I went all the way back to school for accounting and studied taxes. Um, ’cause I live with a, you know, artists are solitary creatures. You know, you, when you’re a painter like me, you’re in the studio for long, long hours alone. And the only way to build your career is through a network. So, you know, we are like, uh, super networkers and my community of artists was deeply in need of the same information that I was. And I, I like, knew there was a need out there, and I was like, I’m so upset by the way that this has been delivered to me, if at all. Um, there’s, there’s a market here. Um, so I started my business Sunlight Tax. Um, and that’s my mission is to, it’s much, it’s much bigger of an audience than just creative people, but it is really kind of for people who maybe where money is not the sole interest that they have when they do the thing they do. Right. And I think as academics, you can probably relate to that because most people who go into academics have a passion for their field. Right. They’re trying to do some research, and that probably is a little bit primary over money. And so, you know, that’s very similar to artists that’s very similar to sort of mission-driven people. So it’s kind of a big group of people where money is not the only thing, but these people need to do their taxes too.

Similarities Between Academics and Creatives

Emily (05:37): Yes. I see so much of an overlap between how you described your journey to what you do today, uh, in the tax world, at any rate, and what I do with, uh, as being a financial educator. Yeah. Um, I love you sort of got started comparing the community that you come from the artist community with the academic community. I totally agree about those, um, overlaps. Are there any, would you like to elaborate on that in any way? Specifically? I’m thinking of are there like mindsets or like skills that you’ve observed or perhaps lack of skills among your community, um, perhaps that overlap with ours that either are, um, helpful or not so helpful when it comes to running a business, which some academics end up doing.

Hannah (06:16): Yeah. Well, I’m, the, the world of academia is not foreign to me. I mean, I taught, I was a professor, uh, at Boston University for a brief moment, <laugh> before I realized that I, I, uh, the, the strictures of academia were not, not for me. I think for people like us, when you’re, when your identity is formed around a passion for a thing, um, money can become the enemy by accident. Not really on purpose usually. But I think, um, I see a parallel between people in creative fields where, you know, there’s no artist in the world who’s gonna tell you that they do anything except make the best possible art they can. Right. And I think the same is true in academia. You’re gonna do the best, highest quality research you possibly can. You’re gonna, you know, whether that’s the most innovative or, you know, you’ve got the best ideas, the best protocols, whatever, however you’re doing it. And I think when that’s the case, you can kind of lose, you know, what you focus on is what does well, and if your focus comes off of money, too much money can get, uh, it can atrophy, right? Your skills in it can atrophy. Um, when your attention is not there, you just, uh, it can kind of get away from you. Right? And so I think that that is a sort of similar issue that, um, people in academia have to people in the creative world. Um, and I think just, you know, we’re busy, right? We’re busy doing the thing, we’re doing <laugh>, and this is one of the reasons I didn’t wanna be in academia ’cause of how busy you get <laugh>. Like, I was like, I, I’m never gonna be in the studio again if I do this. Um, and, and you just, it’s hard to check like, you know, self-employment, you know, when you’re talking about like grant income or the types of income that, that we’re talking about here, like track doing, doing, setting up bookkeeping, paying estimated quarterly taxes, like things like that. You know, they are a little bit complex and they do require some ongoing attention. So that’s, that’s a challenge.

Emily (08:23): Totally agree with everything you just said. Underline that. Um, in addition, I wonder if you could speak to, because I think another commonality between these communities is a percep- a perception among ourselves that our work is undervalued by other people and then we end up undervaluing ourselves in some cases, um, which is really dangerous when it comes to business ownership

Hannah (08:45): Very much. Yeah. And I think it’s, it, it’s easy to get into a mindset like that, especially if people around you in your daily life have a mindset like that. You tend to absorb the attitudes of the people you are with all day. Um, and so yeah, if you have people around you who feel like, uh, you know, the good ideas are over here and the money is over here and they’re in opposite directions, you’re gonna start getting outta balance where with, where money is in your life, like, I, I like to think of it this way, that money is neutral, right? Money is a tool. It’s like a hammer. You can do good things with it. You can do bad things with it, right? Like it’s amplifying the power of the person who has it. So if you’re doing good work, if you’re an ethical person, you can do amazing things and you can do more of them when you have more money. I don’t know. Think, um, think Oprah, think, um, Dolly Parton, you know, these are people who have great amounts of wealth and who do truly world changing wonderful things with their money, right? Uh, we could also probably think of quite a few examples of people who do not so great things with their money <laugh>. But I think the problem is when you go from thinking of money as neutral, right? Money as just being an amplifier of your agency to being negative, that that’s where you start getting problems. You start getting in a sort of stuck space around it. Because if you think of money as negative, or if you think that somehow your motives or ethics will be corrupted, if you simply have money more of this tool, you won’t advocate for yourself properly, right? Um, you cannot walk into a job interview and really nail it, um, nail the salary negotiation part of it specifically. Um, you’re not gonna advocate the way with the fierceness in that interview that you would if you believed that money was good, right? Or, or money in your hands was a good thing. If you fundamentally think, you know, having a fully funded retirement is makes you kind of a yucky person, you’re not gonna ever fund your retirement. You know, these things are related.

How Do You Know When You’ve Actually Started a Business?

Emily (10:55): Mm-Hmm. That is so interesting. I’m really, I really like the way you put that. I haven’t thought about it quite that way before. So thank you so much. Um, okay. I wanna narrow down to talking about like business ownership for, again, my community, which has many similarities with yours. Uh, they’re gonna be doing this as a, we’re gonna say a side income though, right? They have their primary thing as being a graduate student or being a postdoc, and they’re pursuing that, but they have a self-employment side hustle as well. Oftentimes what I see is people acting as like consultants, for example. Um, or maybe they’re a writer or an editor in, in this kind of world. So these, these kinds of side hustles, whether maybe, or data science. They’re employing some skills perhaps that they have developed as an academic, but outside of that academic context as a business owner. So, and I love that you’ve talked about this extensively on your podcast, but the question to you is how does someone know when they’ve actually started a business? Because especially when it’s something on the side, it may be a little vague at first.

Hannah (11:50): Yeah. This gets really confusing if you start thinking of the other organizations that think of your business start time as different. Um, and I, I do have a whole podcast episode about specifically when each one thinks you start. Um, so if you want me to, you know, link to that in your show notes, I would be happy to send that link. Um, but, you know, that’s on the Sunlight podcast. So to the IRS and this, you know, I’m a tax person, so I’m orienting towards that. When it comes to when you report the income, when you report the expenses, um, to the IRS, your, your business begins the moment you advertise. And that actually makes a lot of sense if you understand what makes you a business. The IRS says that you’re a business versus being a hobby. Um, so your side hustle is a business and not a hobby. If you have a profit motive, if you are trying to make money with it, right? It doesn’t mean that money has to be, you know, you worship at the altar of money and there’s nothing else in your life and you throw all your ethics and your, you know, value and, and your amazing work out the window. Not that, but it has to be in there, has to be in the mix, and it has to be, you know, strong. Um, and so if you think about that, having an intent to make a profit, which is the IRS definition of you being a business that happens before you make a profit, that happens before you make money. And I think this is where people get confused. They think, I I, I, I only get to report it once I’m making money, but actually no, because you start that business with expenses, right? You have expenses first. Then once you’ve built something, um, let’s use an example of like a pizzeria. ’cause it’s very tangible and we’ve all been to one. Um, you don’t start generating income from that pizzeria day one, right? The pizzeria has to exist first. Like, you can’t sell a slice of pizza if you don’t have an oven <laugh>. You have to install the oven, you have to have a bakery, you have to have flour, right? So you’re gonna have a lot of expenses before you ever can even bring a dollar in the door. And I think it’s really important to get your head around that concept. You are not broken because that’s how your business is working. That’s actually normal, right? And we have in business school, they teach this concept called the break even point. Well, what is that? The break even point is the magical moment when you go from negative income, AKA, AKA spending <laugh> and, and, um, it’s that magical moment when you go from negative income to zero, right? And then over the zero, then the number starts getting positive. That’s the moment you become profitable, right? When your, when your income rises above the amount of your expenses for the first time, and you know what, there is no guarantee or promise that that will ever happen or that it will happen on a certain timeline. That’s all within your control and your profit motive should be driving that bus. But, uh, it’s, it’s good to know that it’s normal to have expenses first. And in fact, you’re entitled to file a Schedule C that is where you put this stuff on your tax return. You’re entitled to file one before you have a profit. So the title of the Schedule C is profit or loss from business. So one, you have to be a business, it’s in the title, but also you don’t have to have a profit that’s also in the title. So that’s kind of a good baseline. So remember, the moment you advertise, and if you think about it is, is the moment that you start that your business starts. And if you think about it, that makes sense. ’cause advertising says hello world, hello clients, I’m open, I have this thing available. If you’re the right person, if this will work for you, come and get it. Right? But also, you know, to somebody who is, let’s say, doing some freelance editing on the side, advertising is not gonna look the way it does for Coca-Cola, right? Advertising for you is probably gonna be an email to a couple of friends and family. You’re still advertising. You probably aren’t thinking of that as advertising, but whatever you do that’s signaling, Hey, hey, I do this thing, are you interested? So maybe that’s an Instagram post. Maybe it’s an email to friends and family. Um, maybe it’s a website going live. Those are all your moment when you started advertising.

Emily (16:14): I’m so glad you gave that example because as I said earlier, I see a lot of like service-based businesses as side hustles, um, for this community. And so just when you were describing that, I was like, yeah, if you put something up on LinkedIn, if you put your services out there on, um, whatever the current version of Upwork is, um, or like you said, an email to a friend putting up a website, Hey, it costs money to host a website. So like, you’re probably having your first expense when you do that. Um, or maybe you’re starting to pay for software to like get client scheduling set up or whatever it might be. Um, I think part of the confusion when people are asking this question is they think somehow it’s like a, a bad or like an onerous thing to be considered a business and have the attendant tax filing, uh, requirements along with it.

Emily (16:57): But what I really learned from your podcast and your attitude around it is no, this is a great thing to be considered a business, especially as you were just saying, when it takes some time to get to that turning point where you actually have profit. So like, if you have a whole year when you have some, some loss, even though you’ve started advertising, maybe you have some expenses, the income isn’t there yet. Um, you can use that to reduce your tax liability, actually. And so it’s not, it’s not a bad thing to be considered a business earlier. It does have some complications, but it’s, it’s, it’s actually a very positive thing to realize that you have a business

Hannah (17:29): Very much. I mean, and it, it tangibly lowers your taxes. <laugh>. I mean, we in this country are supporting business not out of a charitable purpose, but because it’s good for the u- US economy, right? Like when we support us small businesses and, and we count, you and me, Emily, we count <laugh>. Um, when you support a small business, you are, you are helping the US GDP grow, right? That’s in the interest of the nation we live in. Um, ultimately, you know, you’re gonna spend a lot of money, you get business deduction, you get business expenses, they are deductible on your tax return. That’s a incredible benefit given to you by Uncle Sam. I mean, I, I don’t think we all appreciate that quite as much as we should. Um, but that’s, that’s huge. Um, and yeah, and so you’re, you’re getting this subsidy <laugh> and it’s nice to take advantage of. It’s nice to know what your rights are and take advantage of it. Um, and of course, if you weren’t a business, if you were operating as a hobby, instead you wouldn’t get those deductions. So there’s a real difference.

Emily (18:38): Yeah. Thank you.

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Emily (18:41): Emily here for a brief interlude. Would you like to learn directly from me on a personal finance topic, such as taxes, budgeting, investing, and goal-setting, each tailored specifically for graduate students and postdocs? I offer 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. 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 institutes 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.

Best Financial Practices for Early Career Academics With Businesses

Emily (19:59): Okay. So I’m thinking still about this grad student or postdoc or early career PhD who’s, has this business now they know they’re starting it on the side. What are some best practices that they should implement in their finances from day one to make things easier or like totally above board going forward?

Hannah (20:16): Sure. Um, the first is to open a separate bank account. Um, you wanna keep your business income and expenses separated from your personal bank account and personal expenses. Um, there’s many reasons why this is a good idea. All of it is a good idea. <laugh>, there is no negative, um, except that you have to go through the effort of opening an account. Um, but the magic that that separation does is now when you have that business bank account and you deposit all the money you earn from that freelance side hustle, you know, that gig, whatever it is, now you are creating a record of everything into and out of your business. That record becomes the backbone of your bookkeeping. So now from there, setting up bookkeeping, setting up tracking becomes far simpler. Um, Emily, when I started out as a professional artist, before I knew to do all this stuff, I was printing out bank statements going through, you know, like three days before tax time, going through my bank statement, line by line with a highlighter, trying to, trying to recall if that trip I made back in February last year to Lowe’s was for business or for my home, right? <laugh>, Like we don’t want that <laugh>. If you have a dedicated business account and you keep a mindset of I only spend this money on business expenses, then everything in there is deductible. You just have to sort out what category of deduction it goes into. So man, it makes your life simple. And then, you know, once your business grows, this is a thing that grows with you. Um, you can automate that bank feed into bookkeeping software. That’s a next step thing. You don’t have to do that day one, but it gives you the, you know, the easy option. Um, also if you one day create an LLC for liability protection, your LLC will be instantly invalidated if you don’t have a separate business bank account, you, when you have a liability, uh, limited liability corporation, the whole thing you’ve done legally is to separate your business and personal selves. And if you then don’t actually do it in the background, a court of law can say you don’t have an LLC, you don’t have any liability protection, and basically your LLC is thrown out, you’ve wasted all that money. Um, so <laugh>, there’s no downside, in other words, to a business bank account. PS it doesn’t actually have to be technically a business account according to your bank’s rules. It can just be a personal account. That’s another separate account. It’s the separation that’s important. So it can be, you know, technically a personal account according to the bank. That’s fine. Just use it like it’s your business account.

Emily (23:05): Thank you so much for that. Um, that clarification, and actually you threw out a couple of terms there. So I just want to, this is partially some things I’ve learned from you, clarify for the listener. Um, this, this term LLC, the limited liability company, this is a legal status and it’s not, it doesn’t necessarily confer a specific tax status. So when you’re first starting out out, when you’re first starting out with a, a side business or something, you’re likely gonna be operating as a sole proprietor. Then maybe for the entire lifetime of the business, you’ll be a sole proprietor. Whether or not you open an LLC as well, your tax status will stay a sole proprietor. That is, unless you decide that you want to grow your business to the point where becoming a different kind of tax status would make sense, like an S selection, et cetera. But for people who keep businesses on the side, I would imagine many of them continue to operate as sole proprietors indefinitely.

Hannah (23:55): Yep. I would say that’s probably true. Yeah.

Preparing for Tax Season as a Business Owner

Emily (23:58): So you just mentioned this core first step, which is to open a separate bank account, and I totally agree with it. You know, when I first started out my very first side hustle, I didn’t have that, but I knew by the time I started this business that it was important. So that was the first thing that I did when I started this, um, this business, even though I’ve been a sole proprietor the whole time as we were just talking about. So is there anything else that someone should do, um, like at this point in the year, you know, we’re sitting in September when we’re recording this. Is there anyone, anything that, uh, business owners should do outside of their actions during tax season to set themselves up to, you know, prepare a tax to return easily to minimize their tax liability beyond this core, as you said, the backbone of having a separate account?

Hannah (24:39): I mean, there’s a whole world of year-end tax planning. I would say independent of year-end tax planning, which is coming up, we are coming upon that time of year. But independent of that, I would say from your separate business bank account, just setting up some basic bookkeeping is a good idea. Having the separate bank account isn’t bookkeeping itself, though. It forms a basis for it. So if you don’t love the idea of like sitting with your bank statements and pulling everything into a category, you know, before tax time, doing that in advance is quite nice and quite helpful. <laugh>. And I actually think if it’s at the level of a gig or a side hustle, I actually think you don’t need bookkeeping software at all. I think bookkeeping software, if I’m just being totally honest with you, it’s very easy to make very expensive mistakes that compound and, uh, that you can only get undone with very expensive accounting help. Um, so I actually don’t really think people with very, very small like side hustle level businesses maybe even should have software for bookkeeping at all. Um, but that doesn’t mean you do bookkeeping. You can just do it on a spreadsheet. So have a spreadsheet, lay out your expense categories, track your income, and just do the tallies. Um, because knowing if that will help, you know, in an ongoing way if you’re profitable or not, which is a, a big deal, it’s also what your taxes are based on. So, um, paying estimated quarterly taxes, for example, if you need to, is only going to be possible when you know what the number is, <laugh>. Um, so you wanna be able to know what your profit was for the quarter. So you can do a little calculation about what percentage of that you need to pay to the IRS and to your state for taxes.

Side Hustles and Estimated Tax

Emily (26:29): This is a little bit nuanced. Um, what I’d like to specifically talk about is how to like sort of add the estimated tax process on top of an existing salary, right? Because this is a side hustle business, so. What would you tell someone who’s, uh, who has that situation, how they should handle their estimated tax?

Hannah (26:50): Yeah, I might tell them to avoid it altogether. Um, honestly, because human behavior being what it is, estimated taxes are manual. You have to do the calculation, you have to make the payment. And we just know from data, you know, from behavioral science that people don’t do things like the, they do the default more often than not. So if you can default your taxes, that’s what you wanna do. So if you’re in the side hustle zone, the thing you wanna understand is that your taxes are holistic. They are all of your income lumped together and your spouses lumped all together and put onto one tax return with one number of what you owe, or you know, what you got a refund for if you overpaid. So if three quarters of your income comes from a job, you know, where you’re an employee and you have payroll withholding your taxes throughout the year, and one quarter of your income is coming from this gig or side hustle, you have enough proportionally money that you could take out of your W2 to never have to pay quarterly taxes. But what you need to do, the action you do need to take is to file a new W four with your employer to adjust your withholding at your day job to over withhold. In other words, you don’t wanna withhold only enough taxes to cover the tax obligation formed by the employment. You wanna overdo it and go into taking enough taxes to account for your self-employment. Um, your gig, your side hustle income that is considered self-employment income. FYI, um, and the taxes on that are always higher than you think because self-employment tax applies to self-employed income. So your employer is paying one half of that amount. It’s one of your wonderful benefits as an employee. You pay both halves when you’re self-employed because you legit are the boss <laugh>. You pay the employee and the boss half of Medicare and social security. And we call that self-employment tax. So my tip there is pull a W 4 off the internet, go to irs.gov, grab yourself a W 4, fill it out. You might need some old pay stubs. You might want last year’s tax return. If you have any bookkeeping from your business year to date, that’s great. Um, or just last year’s tax return. Um, hopefully if that gig was going already last year. And then you just wanna fill out the little, um, paycheck checkup tool on the IRS website that will help you, um, adjust your withholding to essentially give you, you know, the refund level that you wanna have. Um, I recommend zero <laugh>

Emily (29:34): I, it’s the same way I would approach things. That’s how I also teach. Um, anyone, anyone who has a fellowship income, which does not have withholding on it, but who also has W2 income, their spouse or them, that’s the same thing. I say, make this easier on yourself, just fill out a new W 4. But let’s add the added wrinkle of they don’t have the W2 position. Let’s say they’re receiving a fellowship, it already doesn’t have tax withholding on it. Maybe they’re already doing estimated tax because they have that fellowship. Um mm-Hmm. How should they incorporate the self, the self-employed income and, and the income and the self-employment tax from that, um, in with their ongoing like fellowship type income, uh, calculations?

Hannah (30:12): Yeah, well they’re gonna, you’re gonna need to do some degree of bookkeeping or else it’s gonna be a very stressful moment before the tax deadline. Um, and you will, you know, you’ll need to pay quarterly taxes every single quarter that that’s your legal obligation. So under US tax law, if on last year’s tax return you owed more than a thousand dollars, then you have to pay quarterly taxes this year or else you’ll get penalties and interest. Um, and you can pull out last year’s tax return and you can check if you’re in this category. So line 37 of your 1040 personal income tax return is gonna tell you what you owed last year. And if you see a number on there and it’s greater than a thousand, you gotta be paying quarterly taxes this year. Um, PS line 38, the line just below that is your estimated tax penalty <laugh>. So you can look at that line to see if you’re already being punished for not doing this. Um, I think that people, you know, we have a whole tax industry out there trying to, you know, its marketing is based around making us all hate and fear our taxes and actually kind of implicitly training us not to even look at it to just feel so fearful. And so, like hands off that we don’t even look at it. And I’m just here to say, I hate that I disagree with it. Your taxes are yours. Your 1040 is your information and you can, you know, the first two pages of it summarize every single thing that is in that big tax packet. And if you just look at every line on the first two pages, you have massive power. You know what’s happening. Um, and I just told you two lines, the power in those two lines, line 37 and line 38 and that, you know, that will, that will help you kind of get your head around <laugh> whether you have to pay quarterly or not. If you do, um, you know, if you think about what line 37 tax, you know, what you owe, like owing something at tax time is not supposed to happen, right? It does happen. It’s okay. It’s a reconciliation document where we reconcile the actual amount paid versus the expected amount, um, and we settle up the difference. But essentially owing anything means you underpaid your taxes throughout the year. ’cause we live in a pay as you go tax system. You’re supposed to pay your taxes as you go through the year, not all on April 15th.

Emily (32:40): I think what I would say, in addition to what you just said, um, the, the form form 1040, ES, the estimated tax worksheet is a very helpful document in calculating your estimated tax due. Um, people in the audience listening may already be familiar with this for their fellowship income, but you just have to add in a few more lines relevant to the business income and so forth. But if they don’t wanna do more calculations, I think I would tell them just to kind of, as a rule of thumb, set aside an additional 15.3% of their business profit. If there is a profit for that self-employment tax pay, that plus whatever their marginal tax rate is, let’s say it’s 12% usually for graduate students, maybe 22% for some postdocs. Um, if they’re single and just doing that much, if you don’t wanna do like a full calculation is gonna get you, that’s an 80 20 <laugh> on that is to add mm-hmm, that additional amount of money in with either your W 4 or your estimated tax payments if you’re doing it on your fellowship already. Um, but doing the detailed calculation is always gonna be the most, uh, thorough and the most accurate way to go. But Hannah, uh, when you were.

Hannah (33:46): Sure, although keep in, keep in mind ’cause it’s stressful for people. I think like especially if you’re coming to this and you’ve not learned about how estimated quarterly taxes work, um, it’s really important to remember the first word. It is an estimate and you’re not gonna know, like fundamentally you can look at your tax rate from last year, but last year’s tax rate does not guarantee this year’s tax rate, right? So even if you do it in good faith and you did the best possible job, you could, you can still be wrong. And so really, I just encourage you like 80 20 is a good attitude on this because it is called an estimate because you don’t have a crystal ball, like the law cannot compel you to accurately predict a future. So we can all just breathe a sigh of relief and just estimate and that’s okay.

Emily (34:35): The other good thing about paying those quarterly taxes, um, as you go, as you were saying is that, um, there’s never gonna be such a huge balance built up. Like something that often happens in our community with fellowship income is that people get to tax season and they realize they owe three, four, $5,000 because they never paid estimated tax or had tax withholding during the year. And that is a huge shock on like this level of income that we’re talking about. And it can happen with business income too, um, especially if you’re taking distributions from your business and then you’re spending that money. Um, so either keep the money in your business account and don’t take the distributions or as you take the distributions, make sure you’re putting aside something for either your quarterly or your annual tax bill so it doesn’t, doesn’t get away from you <laugh>.

Hannah (35:17): Absolutely. Yeah.

Sunlight Tax and the Sunlight Podcast

Emily (35:19): So just a few minutes ago when you were talking about how, um, you know, our, our system, mostly the tax industry that’s built up around our regulations, they want you to feel a certain way about taxes and in fact you should be empowered about this, et cetera, et cetera. This is a taste of what people can get on your podcast. So I would love you to take a minute and just tell everybody where they can find you, what you put out there, what you do in your business, and if they want to learn more from you or work with you in some way, how they can do that.

Hannah (35:46): Sure. Thanks Emily. Um, well, so my business is Sunlight Tax. If you go to sunlighttax.com, you’ll find everything there. So if you miss something, sunlighttax.com, I have my podcast, which comes out every Tuesday, Sunlight, um, you can find that on my website, sunlighttax.com. Um, I also have a bunch of free resources like, uh, deductions guide, a visual Guide to Tax Deductions, which you can also find on my website. Um, I offer a lot of free courses, including a recent one about, um, LLCs. If you go to sunlighttax.com/llc, if you happen to have formed an LLC for your side hustle or your business, um, there’s a mandatory, a mandatory new report required, um, from the US Treasury <laugh>. Um, but also I have a program called Money Bootcamp where I teach, um, people how to set up very simple systems to track your taxes, um, pay your estimates and fund your retirement using tax advantage accounts. So, um, all of that you can find @ sunlighttax.com and,

Emily (36:51): Excellent.

Hannah (36:51): Yeah.

Best Financial Advice for Another Early-Career PhD

Emily (36:52): Yes, and I will definitely personally vouch for the podcast because I am a listener every single week and I learn something new every week and I think it’s great. Um, okay, Hannah, I’m gonna end by asking you the question that I ask all my guests, which is, what is your best financial advice for an early career PhD? A grad student, a postdoc, someone recently out of their PhD training? Um, and that can be something that we’ve touched on already that’s related to tax, or it could be something completely aside from what we’ve discussed.

Hannah (37:19): Sure. Um, I’ll say this, it’s a bit of my personal religion, but, um, if you have never played with a compound interest calculator and seeing what the power of your money is when it is invested, um, please do yourself that favor, <laugh>. Um, and I would say do not just write yourself off. Say, I am broke right now. I will wait to put money in an IRA I really highly encourage you, if you do nothing else, maintaining an annual habit of maxing out your IRA will put you in a better position. Um, it, it will, you know, you invest the money inside the IRA so it will grow with compound interest and tax sheltered. So it’s really a wonderful thing that works when you start young <laugh>. You don’t wanna miss five years of compounding because you’re in grad school. Um, if you can, you know, just make it your religion to do it every single year without skipping, I think that is my best piece of advice. And believe you as a 45-year-old woman, woman, <laugh> talking to you, I, I wish for everyone here that we could all have started at the age that you are now. Um, and the age you are now is only it, you know, the best time to start this investments your investments was 20 years ago, but the second best time is now.

Emily (38:41): Love that advice. You touched on my two favorite topics today, taxes and investing. So it’s amazing. <laugh>. I will also just say, I mean, I love the goal of maxing out an IRA, but that’s not gonna be possible for many people. So even if it’s just, um, $50 a month, a hundred, 200, whatever you can do, be in the habit of it. And do as much as you can. And then absolutely, once you get that higher income from your lovely post-PhD job, then you can really ramp it up and use your 401k and use everything else. But having that habit of doing it from earlier and having sort of developing the identity of I am an investor and understanding things like compound interest that is gonna serve you so well later on, um, not just the dollars and the numbers, but all that psychology that comes along with it.

Hannah (39:24): Absolutely. Yeah. They, they show that even very, very poor people who have a savings account save more because just having it there helps you do it. So if you haven’t opened an IRA yet, I encourage you to do it this year. Even if it, even if you put 10 bucks in <laugh>, like open it. The fact that it’s there is setting up the infrastructure to make it easier to do that, you know, thing. And really saving, savings and investing is a muscle. So think of it as like a muscle that you have to get in some reps to get good at.

Emily (39:55): I love it. Hannah, thank you so much for joining me today. It’s been a wonderful episode and thanks again.

Hannah (40:02): Thanks so much, Emily. I really loved joining you today.

Outtro

Emily (40:15): 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.

How This Life Sciences PhD Fosters Entrepreneurship

June 3, 2024 by Jill Hoffman Leave a Comment

In this episode, Emily interviews Dr. Marquicia Pierce, who holds a PhD in molecular physiology and biophysics from Vanderbilt University and an MBA from Northwood University. In the ten years since finishing her PhD, Marquicia has worked in various capacities to foster life science start-ups and small businesses, and she is now the owner and principal consultant for Ruby Leaf Media, a science communication company for people who want to turn their tech story into a business story. Marquicia recounts the courses and projects she pursued during graduate school that set her up for her post-PhD career and how she balanced her advisor and committee’s expectations with her career ambitions. She also details the multitude of government, academic, and private sector resources that are available to founders and inventors and the skills and mindsets that a PhD can bring to entrepreneurship.

Links mentioned in the Episode

How This Life Sciences PhD Fosters Entrepreneurship

Teaser

Marquicia (00:00): Get in a great habit of, um, not only just looking at the numbers, but what is the story behind the numbers? If I was to say, have a narrative around this, what did, what did it mean? And it’ll help you uncover what your priorities are. Something that’s not working. Like I, I spent so much money on this, but I don’t know if it’s really working. You’re kind of already gut checking and doing like an audit, if you will.

Introduction

Emily (01:00): This is Season 18, Episode 1, and today my guest is Dr. Marquicia Pierce, who holds a PhD in molecular physiology and biophysics from Vanderbilt University and an MBA from Northwood University. In the ten years since finishing her PhD, Marquicia has worked in various capacities to foster life science start-ups and small businesses, and she is now the owner and principal consultant for Ruby Leaf Media, a science communication company for people who want to turn their tech story into a business story. Marquicia recounts the courses and projects she pursued during graduate school that set her up for her post-PhD career and how she balanced her advisor and committee’s expectations with her career ambitions. She also details the multitude of government, academic, and private sector resources that are available to founders and inventors and the skills and mindsets that a PhD can bring to entrepreneurship.

Emily (01:52): I’m looking for a couple more interviewees to round out Season 18 of this podcast! If it’s been in the back of your mind to do so, this is your official invitation to please volunteer to be interviewed. I love that on this podcast I get to feature PhDs and PhDs-to-be who are almost exclusively regular people and learn and share their real-life stories and strategies. Please go to PFforPhDs.com/podcastvolunteer/ and fill out the quick form, and I’ll be in touch over email. I look forward to interviewing you in the coming months! You can find the show notes for this episode at PFforPhDs.com/s18e1/. Without further ado, here’s my interview with Dr. Marquicia Pierce of Ruby Leaf Media.

Will You Please Introduce Yourself Further?

Emily (02:51): I am delighted to have joining me on the podcast today, Dr. Marquicia Pierce of Ruby Leaf Media, she’s the owner there. And Ruby Leaf Media, as she described to me, is a science communication company for people who want to turn their tech story into a business story. And just in our pre-interview chat that Marquicia and I had, it was so fascinating to hear about her career journey. I know you’re gonna get a lot from this as well. So, Marquicia, welcome to the podcast. Would you please introduce yourself and your company for our listeners?

Marquicia (03:18): Thank you so much, Emily, for having me. This is such a great opportunity, um, just to chat, sit down and chat with you. You’ve been providing such great valuable resources for, uh, a lot of my colleagues, so I appreciate the opportunity. Um, so yes, so my name is, um, Dr. Marquicia Pierce. I am a life scientist by training. My, uh, training was in molecular physiology and biophysics. And, uh, ever since my time in the lab, I, I found that I really enjoyed being able to take those concepts from the lab and bring them out to the community. So, um, as we’ll get into, uh, some of the, the context here, um, my background includes, um, being a military brat who, who knows that community can be, uh, made and you have an obligation to, to bring something to that community. And so, um, I’ve just been able to fortunately, have been able to do that for a lot of different, uh, high tech companies that are started by PhDs and they’re trying to cross over from the lab to, uh, bringing value to, to their community, wherever that is.

Experiences During Grad School That Went Beyond Basic Research

Emily (04:20): And this is gonna be a really fascinating interview, um, on just all the opportunities there are in front of graduate students and PhDs for doing just that, for, um, advancing their careers and translating their work. And this is gonna be amazing, but I wanna hear more about your kind of personal journey as well. So going back to graduate school, can you tell us a little bit about like the, um, the things you did that were above and beyond just your basic, basic, you know, research as a graduate student that were like side hustles or like, like extra projects that you did just experience that you gained that helped you, that helped you along in your career path?

Marquicia (04:54): Absolutely. I love this question. Um, so I did my PhD at Vanderbilt University in Nashville, Tennessee. And during that time, I knew two things for certain. I knew I wanted to incorporate some type of business into what I was, um, what I, what I was studying at the time. I was looking at how vitamin C moves in the brain, uh, on a molecular level. We were looking at different proteins that made that po- possible, if there were any, uh, phenotypes or if there’s any characteristics when you didn’t have these nutrition, um, in your, in your diet. And I love that I could connect that to and translate that to my family, like, Hey, if you don’t eat these particular nutrition, these things might happen. Um, and, uh, I remember very specifically, my, my grandmother had major symptoms of diabetes during the time that I was, um, getting my graduate program, uh, completed. And I distinctly remember one day thinking through, I know down to the molecular level what’s happening with her symptoms and her disease progression, what would happen. But I feel so useless and helpless ’cause I don’t know if there’s a particular innovation or something that could, that could help. And that I think that kind of solidified for me that there has to be a way to take what we’re learning and translate. Um, many people have done that, but that’s when it clicked for me. And so, um, I knew I wanted to incorporate business. Uh, I wanted to get an MBA, but at the time, there wasn’t really a great place to insert that into my, my program. So I ended up, um, auditing engineering, a lot of engineering management courses in the undergrad engineer engineering school, and being able to work with them on their marketing, their tech management courses.

Marquicia (06:39): Uh, I was able to be involved with one of their capstone day for seniors where they were, um, trying to put together a research project, um, around a particular technology. We were working with a small businesses in the ecosystem. Um, uh, I had a fantastic member, uh, mentor around that, Dr. John Beers who, who facilitated that connection. And so in the lab we were doing what we needed to do, but I was auditing courses, um, around that particular thing. I was involved with, uh, tech, tech Venture Challenge where we were tasked with we being other students from the medical school, the graduate school, the law school, the business school. We were all trying to get behind a particular Vanderbilt, um, or small business in Nashville invention and make a case for this could be a business that could be sustainable and provide value to the community. Um, those are, those are things that I think were pivotal to add on. You always wanna have science plus something that you, you, uh, enjoy. And also like creative graphic design types of things. So I was, uh, a lot of those art science, um, classes as well. Uh, but yeah, definitely had a lot of projects while I was getting my PhD that helped spark that fodder, if you will, for, you know, what do I do after I get my PhD.

Entrepreneurial Opportunities for Grad Students

Emily (08:02): And in your, outside of just your own personal experience in graduate school, can you think of other like, types of opportunities that graduate students might encounter that would provide similar benefits?

Marquicia (08:13): Sure. So, um, a lot of the student competitions are a great place to start. If you just want to, to dip your, your foot in. How do I work with other interdisciplinary teams, law students, business students on a project? These could be anything from a hackathon to, uh, which, you know, you spend a weekend trying to figure out a business proposal to, um, auditing a course that even, even though they’re undergraduates, that’s, that’s a great opportunity to kind of bring in some of those concepts that are complementary to your PhD. Um, we had a, we had a, uh, academic alliance that was between, uh, Vanderbilt and the entrepreneur community as a whole that, um, it was called Life Science, Tennessee Academic Alliance, where you could get involved as a, a mentor or you could, you can bring in speakers to your, your class. You could, uh, host this tech venture challenge.

Marquicia (09:08): Um, those are great opportunities if you just wanna see if that, that opportunity is for you. Um, a lot of, a lot of times now that was, that was 10 years ago, uh, I’m seeing a lot more, uh, fellowships or courses that you can take while you’re doing your, your, your PhD that will incorporate, Hey, here’s a small business proposal, a market research, um, uh, project, uh, at, at in Michigan, there is a group called My Lead. It is graduate students, postdoc students that do just that. They work as a small boutique consulting agency where they put together, uh, a market research plan. They dig into the de the details and the data both on the science side and the business side and be, and are able to work with other companies in that way. So, um, those smaller projects, six, three to six months or a semester long, uh, is a, is a great way to kind of get your feet feet wet. With that.

Pushback For Participating in Activities Outside of the Lab

Emily (10:05): I’m wondering, um, did you encounter any cultural in terms of, uh, the field that you’re in, the life sciences, any, uh, pushback to you participating in these outside of the lab activities? I’ve just noticed that the life sciences, um, among the STEM fields would probably be the most resistant, um, to those kinds of things. But it sounds like Vanderbilt itself was pretty well set up to facilitate this. I’m just wondering what your observations were around that sort of like, culture of do we engage with business, do we engage with startups, like from, you know, the research side of things?

Marquicia (10:41): That’s a great question. So I know that there were, there were parts of, um, the community that really was open to, you know, there’s, there’s opportunities to kind of engage in these particular ways. We very often had that same conversation, like, how, how much do I say? I don’t want to necessarily, um, have an update about this in my committee meeting, uh, <laugh>. It could very well in that particular case be, um, seen as a distraction. You know, you’re, you’re here for getting your graduate studies done, you stay in the lab, especially if things aren’t working, it’s very hard to justify, you know, um, yeah, well, I won’t be able to work on it, you know, I’m, I’m trying to do this particular class. Um, I think that’s why auditing the class was really helpful. And, um, uh, the way Vanderbilt was set up, it was, uh, their IGP or the interdisciplinary program was very used to these different departments had courses that was as attached to it that we were, depending on our specific route, able to go to.

Marquicia (11:47): Um, and so there was a little bit more set up for if you wanna audit a class, um, we can, we could help that. But I still have to get permission through the graduate school to audit an undergrad class. And that included a conversation with my PI and my director of graduate studies who very, at the beginning, very naively, I said, you know, Hey, I, I think I would like to get my MBA. They were really open to, that’s a, that’s a great thought, uh, in theory, <laugh>, you know, but not necessarily having a pathway for to, to that happen. But yeah, it was very much, uh, I felt like I’m living two lives, and if, if you’re going over to the dark side of consulting or industry or management of, uh, investment banking, something that in, in included that, it was, it was kind of, um, you have to be very careful and impactful of how, how you were able to ex explain that. Um, you know, this is a class that I’m taking, it will be over at this particular time, uh, for one of the projects, uh, as intern, I have to say, well, I, I would be willing to take a pay decrease because I’m not, I’m not putting in the same amount of hours per week. So it, there were, and whether or not that that’s discouraged or encouraged, um, especially if you’re going on year six, six of your PhD, it, those can be very awkward <laugh> conversations, to say the least.

Resources for Academics Who Want to Start a Business

Emily (13:09): Well, thank you so much for sharing kind of your experience in that area. I hope it’s, I hope it’s encouraging to people who are facing similar like questions of, it’s, it’s worth pushing it through. It’s worth having these conversations. Maybe you don’t need to tell them everything that’s going, you know, tell them what they need to know, but, you know, get your work done and, and still, because these, these, these extra quote unquote experiences are the ones that are the most valuable for your career. I, I would say, we’ll see in your own story how this, um, develops. So can you say anything more about, um, the, the resources that are available for, let’s say, graduate students or postdocs or people who are still associated with academia who want to start a business, how, how the, how academia can be set up to help them do that. Um, and what are like the pros and cons of accessing those resources?

Marquicia (13:54): That’s a really good question. Um, if you are in academia, you do have a lot of resources that say if you were not, and you were trying to get something, uh, into, into the marketplace on your own that you might not be aware of. So first of all, if you’re a student or a faculty member, um, the things that you would want to be on the lookout for is if there are any, uh, connections you have with your tech transfer office. Because first and foremost, you’ve probably signed some contract or you have something spelled out with your, your place of employment that any intellectual property or even idea or anything that you work on is, is owned by the university point blank period. So you’re, the process for being able to, um, if, if it’s connected with your research, bring that into a business, they, they have a process for doing that.

Marquicia (14:47): They usually, the tech transfer office will, will, uh, facilitate. Um, it includes, Hey, I have this idea. It is just here, I’m disclosing it to you. I haven’t formed a company. I have this idea. It’s, it’s outside of my research scope. What information or what types of resources do you have, uh, for, for this particular setup? Um, at Michigan State University where I did my postdoc, there was actually a research foundation that, um, helped if you were a student, a faculty member, or even a staff person that was at, at the, OR alumni that was affiliated with the university, and you want to start a company, they were there for you to provide resources like, uh, entrepreneur and residents would be a person who’s gone through that process. They will help you build out a business plan, build out your value proposition, which basically says, how do I, how do I make a business that creates value for other people?

Marquicia (15:39): How do I monetize it and sustain it? There will also be your guide for, here’s some state resources, here’s some academic resources in terms of money <laugh> to fund either other students, undergraduates or postdocs that can help you work through this idea. And they will actually be the, um, work in tandem with the tech transfer office, um, to say, Hey, this, this is related. This could be something that we would need the university to continue to help fund the research for think medical devices, therapeutics, um, things that it takes a university and maybe a team to research. They, they work together. Anything that has to do with clinical trials, you would have to need, you would have to use a village <laugh> that, that EIR or the entrepreneur residents can help guide you through. Um, so there’s academic ins, uh, resources, so tech transfer office, student entrepreneurship groups.

Marquicia (16:36): Um, I’ve had a lot of students that I’ve worked with that are working with a family company, they’ve been able to go through with their student, um, business groups, the, the business schools there. They have pitch competitions that give very real money, 10, $20,000 sometimes. And then also connections around that. How do you get your marketing out, your packaging, your, um, your, your story for pitching to other investors? Hey, you have this food company, Hey, you have this idea. Who in your alumni network can help bring some of, uh, some insights to this? So there’s, there’s resources there, uh, at the school. And then in the, um, community, you have, um, state resources that wanna see particularly life science, high tech innovations, push their economy forward. So there’s grants on that particular side for, uh, if you’re just in this particular region working on a high, high tech, high growth company, scalable company, which a lot of life science companies are, um, here’s what we can offer to you.

Marquicia (17:38): Here’s the connections, market research, um, legal consultants, regulatory consultants, um, how do you put together a website? Those are, those are resources that are available on that end. And then one last thing, I know I need to be brief, brief about this. There are, uh, government particular, uh, outside of the different accelerate accelerators for those things, there are government funding. It’s called, uh, small Business Innovation research, or S-B-I-R-S-T-T-R grants that can specifically, if you’re connected with the university, they, um, would provide high risk, um, uh, financial, financial resources to high risk, um, innovations. Those take a little bit longer to do, and you definitely want a team to help guide you through that. But those are also, that’s also money that you don’t have to give up equity or parts of your company to access. And I’ll, I’ll pause there.

Commercial

Emily (18:35): 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.

Ownership of Ideas and Technology Created With and Without University Resources

Emily (20:02): Yeah, I think that you led right into kinda the next question, which is like the more, um, I guess aside from technology that was developed under your employment with the university, that would then be, you know, co-owned with the university. Let’s say you had an idea outside of it, not related to directly your work, the university wouldn’t own it. Um, the more kind of help you reach out for, depending on the type of help that you get, you may be giving up, um, ownership in your idea. Is that right? Can you speak a little bit about that? I mean, maybe there’s different, you know, giving up equity is different than getting a grant, for example. Can you talk about some distinctions there?

Marquicia (20:39): Sure. So at the very, um, at the very early stage in early stage in life sciences are, um, say you have a device, a medical device, you have a prototype for that device, but you haven’t tested it out on humans. You haven’t done a clinical trial or you have a therapeutic that you, you’ve maybe tested it out on mice, um, but you haven’t, you haven’t moved it towards, um, seeing if it holds up in, in humans. Most of the time you’re doing that stuff with the university. But, uh, if you, if you aren’t and you’re still in that early stage, um, the, the choices that you have are, you can go for grants and in kind services they call this non-dilutive funding, where you don’t dilute your ownership. And, um, there’s regional and government funding for that. And then sometimes accelerators or, uh, venture venture groups will have a program in which they are developing something or they’re developing co-developing with you something that can fast track that time to the market.

Marquicia (21:42): So some examples of this could be like Y Combinator or, you know, um, uh, Techstars or something where in order to have access to this, this great structure that they put in, uh, and maybe even some funds to get together, they would require a percentage of your company small, it could be many that are between five to 12% of that company. Um, the thing is, if you are, if in, if you’re in the life science space and you’re that early stage and you’re already giving up equity, you have a very long runway <laugh> to go to where every, at every milestone the company gets a little bit more valuable. And if you, you’re already given up equity at those earlier stages, you don’t have as much for the, the really heavy duty milestones, a clinical trial, uh, you know, a a distributor agreement to also incorporate or leverage giving up some of your equity. Um, so it’s, it is a very different, uh, thing for the life sciences or an academic project to, to kind of evaluate these options. Uh, if you’re really early on, you haven’t gotten a lot of the feedback or regulatory spot you could consider yourself early and the latest you can push off giving off a pa- piece of your company, the better because it’ll be valuable hopefully later on. And, um, you’ll still have that, you’ll retain that, um, that ownership.

Common Skillsets and Mindsets Between PhDs and Entrepreneurs

Emily (23:09): Well, thank you so much for giving the listeners kind of a taste of that, um, those decisions that need to be made earlier on. It, it sounds like, um, being, you know, having an academic affiliation can be so helpful because you are in many ways still considered like a learner no matter, no matter what stage you’re at. And so there’s so many resources available to help you along that path. So I’m, I’m curious now about your personal journey and also the journeys you’ve observed in others, um, from, I believe you mentioned earlier that you started your company sort of out around the time that you finished graduate school. You’ve also had a lot of other positions along the way that have, you know, added to your career. Um, and so I’m wondering for you as an entrepreneur and someone who works with entrepreneurs, what kinds of, um, skill sets, maybe mindsets are common between PhDs and people who start and run businesses? Um, like what’s help? What did we learn in the PhD that’s helpful for later entrepreneurship, those kinds of things. And that could be from your personal experience or the people you’ve known.

Marquicia (24:09): Sure. I’ll start with my personal experience. So the very first time I was introduced to like, we have to set up a company around this technology was during my postdoc. So after I left Vanderbilt, I went to Michigan State University under a, a industrial postdoc position where, um, the goal was I was working with two academic re- tenure track professors, <laugh>, trying to get a company up and going and started. And so, um, the skillset that I brought to the table and that I was trying to hone, um, was, was interesting. ’cause I was, while I was getting my PhD, I was also getting my MBA, so I was learning what were some of the frameworks that business people used, how do they talk about how they use a process, and then how do, how does that work in the lab? Or, um, how do I need to translate that from what we were doing in the lab?

Marquicia (25:00): And so, um, I would also often go back to the framework for problem solving and commu- and gr- and great communication were, um, very much similar. They just were talking about different things. So I’ll, I’ll explain. So, um, in the lab I’m working through, okay, is a small molecule, uh, useful. We do a battery of tests to distinguish why, um, based off a couple of characteristics. It might be this one is, um, it works well with cells, it’s less toxic and, you know, um, it’s, it’s easy to make. I’m being arbitrary. The way I would translate that story, um, going through my, my MBA type of framework would be, well, what value are we creating and, and specifically, who is it for? So the molecule, these, these features that we have that we were very, um, we’re trying to, trying to point out and be distinct about, now I have to turn them into benefits.

Marquicia (26:01): Well, uh, it, it’s this type of molecule that means that it’s, it’s less toxic. What does that mean to our business uh, story? Um, the people who would use it, the physicians or even the patient themselves. Well, that means that if we can keep it within the cell, it’s not messing around with your, your gut and causing you nauseous or, you know, killing other healthy cells, that means that you could take less of it. And, you know, that means for the physicians, they might adhere to the, to the drug cadence a little bit better for the patient. It means that I’m not getting upset stomachs as as often, I don’t have to, you know, get as many injections. Those are the types of communication skills where you, you are working through the same rigorous process, but you’re just trying to communicate it in a little bit different way. Um, that you, that you see when you’re filling out that story as a, as a PhD, well, I’m doing this study who, who’s in my audience? Or who’s, who’s my audience? Usually it’s your community members, right? So they wanna say they wanna see what happened, what are you doing next? And then, you know, what, what can we help you with? Same thing with a, a VC <laugh> or a, a grant writer. You have to say, what was the background, um, in their particular words, what are you working on? What is, what’s the value that you’re creating? And then where can we go from next? What’s the big milestone? So you’re, you’re able to think through a structure, uh, that’s very similar. It’s, it just needs to be translated a little bit different. Um, but being able to communicate that is, is a strength. Uh, being able to work with multiple teams that are very bright people, but they don’t work where in the same lab and the same methods and tools that you work with, you need to be able to talk their language.

Marquicia (27:41): You have to do that in, in the business world as well. And the scientists and engineers who are able to cross that gap or the ones and coachable for doing that, understanding that, okay, this is a different language. You can apply the, the practice of it, but you have to say it in a certain way. The ones that are open to learning that those are the ones that can convince other people that this is something of value. Get on our team, give us funding, give us resources, uh, that, that helps them to move that, that tech forward.

Emily (28:10): That’s fascinating. Thank you so much. Was there anything else you wanted to add on that question about skills or mindsets that transfer?

Marquicia (28:18): Um, the only other thing is that, uh, usually when I talk about my PhD and I, and I hear other people’s story and they, it comes off very linearly. We can only say one thing at a time. We did this and then we did this, and then we did this. But in reality, your, your skillset that you’re picking up with these different experiences, they aren’t a straight line. They look more like a Gantt chart. It’s like, I was trying this and then I got, I got into graphic design by being the newspaper editor for the department or something like this. And then I, that kind of went to see what policy was doing. So I volunteered a semester at this and you know, you don’t really know if they overlap or if it will lead to that big next step, if you will. But, um, that’s okay.

Marquicia (29:00): It’s, that’s what makes the journey yours is how you find out what’s create, um, how, uh, what you resonate with and the skills that you learn and these offset project or offshoot products or something that you, I was just interested in. Those are the ones that, that when you’re talking to a hiring manager or a, a program manager for that next big gig, those are the things that will resonate with them too. So, um, uh, just know that it won’t be a straight line. You’re not gonna be able to line up, uh, everything until you’ve kind of stay taken a step back and said, well, well actually, that set me up really well for this. I didn’t even know I liked doing this particular thing. So that’s, that’s all I would say for that.

Ruby Leaf Media

Emily (29:42): Absolutely. It’s just a great encouragement to, um, devote I would say a certain amount of time, a certain consistent amount of time throughout your PhD to these, like outside of the lab type activities, um, just so you can explore yourself and explore your environment and figure out what you like. And, um, as you said, you don’t know where it’s going to lead, but that’s a reason to just experiment. And I certainly did this, I didn’t do this as much in my earlier years of my PhD, but certainly by the last couple of years I was more like actively reaching out and trying different things, including the things that led to personal finance for PhDs. Um, because I wanted to figure out where I wanted to go next, and I knew I wasn’t gonna get there by just like keeping my head down and like staying in the lab all the time. Um, that wasn’t where, uh, I was gonna be headed, so. Okay. Would you please tell us a little bit more about Ruby Leaf Media and how people can get in touch with you if they would like to follow up?

Marquicia (30:31): Sure. So I, I started Ruby Leaf Media, um, shortly, like around the time I was finishing up graduate school because I wanted to continue doing these small projects around market research or, you know, putting together a, a industry report and getting paid for it <laugh>. So, uh, basically I, I started Ruby Leaf Media to, um, have that vehicle for that and I really wanted a place to infuse some creativity. Uh, at the time I was really, um, interested in how can you turn, uh, something that’s really technical into something that could be very beautiful and inspiring to your, the people that are closest to you, your family, your, your, uh, community. And so, uh, create creativity versus, um, you know, just being very defensive and, and, um, tactical about what you’re saying. I wanted to kind of merge the two. And so being able to have my own company that worked at that intersection of, uh, storytelling that businesses usually will have to do in some type of, some shape of way was my, my reason for getting started.

Marquicia (31:41): Um, today I work with, uh, a lot of ecosystem partners, accelerators, um, academic universities or academic institutions, I to, I should say, that are trying to instill some of these ideas, um, in some of these concepts and just some of this creative, um, mentor learning or peer group learning, if you will, uh, with their, with their portfolio companies or with their, with their founders. And so, um, being able to, to provide structure for that, either through a program or being able to give them tips on how do you pitch, uh, for a particular funding opportunity, how do you put that story together? That’s what, that’s, um, what my team and myself are, are really interested in doing. And we’re really interested in being able to do that for a lot of different, um, providers so that you can get that group learning experience. Um, right now, uh, the best way to look to, to figure out and see all of the different companies that I’ve worked with actually is actually my LinkedIn profile. <laugh>.

Best Financial Advice for Another Early-Career PhD

Emily (32:48): Very good, thank you. The last question that I ask of all my guests is, what is your best financial advice for another early career PhD? And that could be something that we’ve touched on already in the interview, or it could be something completely new.

Marquicia (33:01): Um, the advice part, uh, it kind of goes around budgeting. So graduate students, uh, well, when I was a graduate student, we got paid once a month and, um, I think probably a lot of graduate students started doing this. They’re doing something similar, but it really helped me got get into the idea of, um, a little bit longer term planning than two weeks or, or even one week, like what are some of the goals that we have for this particular month? IE what bills do we have to pay? What are we trying to get, get done? And, um, it set the habit of budgeting month by month and then, um, being able to bring that over to my business. Budgeting is absolutely one of the, I mean, I feel like a lot of your resources kind of talk, talk, talk through this, but, um, just getting a great habit of, um, not only just looking at the numbers, but what is the story behind the numbers?

Marquicia (33:59): Uh, just kind of walk through. I I, I kind of like when I go through my budget, like, okay, if I was to say, have a narrative around this, what did, what did it mean? And it’ll help you uncover what your priorities are. Something that’s not working. Like I, I spent so much money on this, but I don’t know if it’s really working. You’re kind of already gut checking and doing like an audit, if you will. Uh, and, and it’s, and it’s really helpful with business ’cause it’s like, I’m paying for all these subscription services, or I’m trying, I’m trying to get this marketing campaign off the, off the ground. I think it’ll be done with this quarter, but I’m already 15% into the budget. Did we do what we needed? Just kind of talk it out, <laugh>, just have a narrative around, around your finances and just, just say it out loud. We’ll help you uncover, you know, what’s, what’s working, what’s not working, what are some of your plans? Like, if you find yourself saying things over and over, it’s like, that’s, I keep saying this, uh, that’s, that’s been helpful for me.

Emily (34:55): You know, I, I don’t think I’ve ever heard that suggestion before. Like, not only within the podcast, but like in all the personal finance, you know, material that I read. I don’t think I’ve ever heard someone say, you know, in the budgeting reflection process to tell yourself a story and to create a narrative around how did this period of time go? Did I accomplish what I wanted to accomplish? And I find that to be such a good suggestion and I think I’m gonna start doing this <laugh>, um, because it feels very like non-judgmental. Like it’s, it’s just this is how things went. I’m gonna review that. I’m gonna tell myself the story of it, and next month I have the chance to start over again and make a different story next month if I want to or tell the same one if I thought it went really well.

Emily (35:37): And so, yeah. Yeah, that’s so creative and, and I obviously it plays back into this whole interview that we’ve had and the importance of communication and what you do now. So like, it shouldn’t surprise me that this advice, uh, you know, came from you in particular, but I think it’s, that was, that was really amazing. Thank you so much. Um, Marquicia, this has been such a fascinating interview. Um, thank you so much for volunteering to come on the podcast and to share kind of all of these wonderful, you know, experiences you’ve had and the resources you’ve been able to, um, tap into and just suggestions for other people who want to go on a similar path. Thank you.

Marquicia (36:08): Thank you so much for having me. I really appreciate what you’re doing and this is great. I wish I had been listening to your podcast when I was a grad student.

Outtro

Emily (36:24): 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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Introduction

Will You Please Introduce Yourself Further?

Motivation Behind Pursuing Financial Hacks

Grad Student Financial Hack #1: Participating in Research Studies

Grad Student Financial Hack #2: Editing as a Side Hustle

Grad Student Financial Hack #3: Credit Card/Banking Bonuses

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Grad Student Financial Hack #4: 529 Contributions

Grad Student Financial Hack #5: 457(B) Retirement Accounts

Best Financial Advice for Another Early-Career PhD

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Will You Please Introduce Yourself Further?

Dr. Paulina Cossette’s Academic Journey

Building an Academic Editing Business

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Personal Finances as a Professor and as a Business Owner

A Message for Academics Who Are Unsatisfied With Their Jobs

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Best Financial Advice for Another Early-Career PhD

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Financial Wellness: Struggling with Motivation

Working for Financial Wellness as a PhD Student

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Writing a Book About Lessons Learned During Financial Coaching Sessions

Supporting Financial Institutional Knowledge at Your University

Best Financial Advice for Another Early-Career PhD

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Will You Please Introduce Yourself Further?

Financial and Personal Life Updates

Financially Preparing to Leave Academia

The Two Income Trap

Financially Preparing to Move Across the Country

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Starting a Business While Working in Academia

Advice for Major Career Shifts

Advice for Starting a Part-Time Business

Best Financial Advice for Another Early-Career PhD

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Will You Please Introduce Yourself Further?

Similarities Between Academics and Creatives

How Do You Know When You’ve Actually Started a Business?

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Best Financial Practices for Early Career Academics With Businesses

Preparing for Tax Season as a Business Owner

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Best Financial Advice for Another Early-Career PhD

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Will You Please Introduce Yourself Further?

Experiences During Grad School That Went Beyond Basic Research

Entrepreneurial Opportunities for Grad Students

Pushback For Participating in Activities Outside of the Lab

Resources for Academics Who Want to Start a Business

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Ownership of Ideas and Technology Created With and Without University Resources

Common Skillsets and Mindsets Between PhDs and Entrepreneurs

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Best Financial Advice for Another Early-Career PhD

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