How a California Mom is Changing the Future of Money Management!

#055 Join us in this enlightening episode of 'Raising Financial Freedom' as we dive into the world of Anna Sergunina, a financial planner whose life’s work is dedicated to merging personal experiences with professional expertise. From the bustling economic backdrop of California to the quiet moments of teaching her son about money, Anna’s story is a captivating exploration of financial literacy as a lifelong journey.

In This Episode, You Will Learn:

• The Impact of Geography on Financial Decisions: How does living in California influence Anna’s financial planning strategies for her clients?
• Financial Literacy as a Family Affair: Discover how Anna integrates financial education into her role as a mother and how these lessons transcend the family unit to broader life applications.
• Practical Financial Wisdom: Gain insights into simple yet effective ways to introduce financial concepts to young children, preparing them for a future of financial independence.
• Inspiration through Personal Journey: Learn about the pivotal moments in Anna’s career that shaped her approach to financial planning and client relationships.

Featured Quote: "Navigating life’s financial waters doesn't just require a map, but a deep understanding of the currents that propel us forward." - Anna Sergunina

Connect with Anna

mainstreetplanning.com

Money Boss Podcast

Don’t Miss Out: If Anna’s story has sparked your curiosity or if you’re seeking more guidance on how to raise financially savvy children, be sure to check out the wealth of resources available at our website nurturingfinance.com, dedicated to helping parents cultivate financial independence in their children.

Connect with Us: Listen to more empowering stories and expert advice by visiting raisingfinancialfreedom.com. Join our community to continue the conversation and share your own stories of financial discovery and freedom.

Call to Action: If you found value in today’s episode, we’d love for you to visit our main site for more insightful content, or share this episode with other parents and guardians in your life. Together, we can make financial freedom a reachable goal for the next generation.

Stay curious, stay informed, and most importantly, take action towards a financially free future!

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Transcript

**Eric**:
Today, we have a special show for you, even though to me, every show is special. Nevertheless, today's story blends personal growth with financial smarts. We're diving into Anna Sokranina's world, a financial planner in California. She navigates the busy economic scenes and her cozy home. How does California's economic vibe shape her financial planning? How does being a mom change her views on money? We'll explore Anna's life, sharing lessons that can help you manage your finances better. This episode is more than a tale. It's a guide to financial literacy from the start of life to adulthood. Let's get it in.
**Introducer**:
Have you ever wondered why some people seem to have it all financially? Do well-off parents simply hand their children money? Or is there more to this wealth thing? Welcome to Raising Financial Freedom, the podcast. We are here to talk about everything you never knew to teach your children when it comes to starting a business. Starting their financial future, the principles behind wealth and methods that are out there to teach your child about personal financial freedom. There is no real trick to earning other than learning. We are here to discuss, teach, and grow with you. Raising Financial Freedom, the podcast with your host and concerned parent, Eric Yard. Let us get right into today's show.
** Eric **:
Today on Raising Financial Freedom, Anna Sokranina joins us from California. She's welcomed with open arms, bringing her financial know-how to the show. How has her day been under the sunny California skies?
** Anna **:
Thanks so much for having me. Hi, Eric. I am doing wonderful.
** Eric **:
So where are you coming out from right now?
** Anna **:
I am in the beautiful, sunny California, northern part, right outside San Francisco.
** Eric **:
Oh, how about that? I'm over here in Florida. So we're both in sunny states.
** Anna **:
Sunny states, yes. And I've been stuck in my office today, so, but it looks sunny outside.
** Eric **:
Oh, how about that? So Anna, tell me, with the state of financial literacy at what it is right now, what is your opinion of it?
** Anna **:
It's been a passion project for me over the years to help parents. And this is really the type of clients that I work with in my nine to five job, because I'm a full-time mom, is to not only help them be better with their finances. Right. And make smart financial decisions, but also raise good humans. And so I come from a family that didn't have as much of experience to come from an immigrant family. And so their motor was to make sure we have food on the table and survive. And so all of the skills around financial literacy and what are you supposed to know, right? Once you graduate from college and all the good money management skills I didn't get. And so one of the reasons I even went into financial literacy. And I think that's one of the most important things that I learned in my financial planning career is to help folks be better with that. So as far as wanting to help not only parents, but kids as well, my mission amplified by that once my son was born. And so I am definitely for making sure that these young individuals get on the right footing, because it's really critical in the success that they're going to have in life. And I wish. I don't want to get in the soapbox. But I wish. I wish that our educational system had a lot more structure to that. Even, you know, even some basic concepts starting all the way from middle school, high school, college. I graduated from college with the finance degree and then was required to take the money management course, like personal finance, money management course. So I hope that by the time my son graduates from college, there's some more structure around that.
** Eric **:
Anna's life is filled with two big roles. Being a mom. And a financial planner. Her journey into motherhood has changed how she views money. Now she mixes her personal growth with her work skills. So now, your son has a big advantage with you being a financial planner and you being his mom. I take it you have big plans for him.
** Anna **:
I hope he does. I hope he takes all of the advice that I have for him. But I certainly want to give him, you know, a lot more footing. I want to give him a lot more support than I had growing up and definitely help. And one of the things that I've learned as a mom, too, especially for your listeners who have younger kids, not just around finances, but it does apply to money management and finances, the child's brain gets developed in the first seven years. I mean, it does get developed further than that, but the most like core concepts and ideas around the world and habits and everything gets sort of synced in the first seven years. So I am a mom. I'm extremely on the lookout here to make sure that not only, you know, I teach him the right principles, right, that he can understand at this at this age around money, but also, you know, everything else, because there's there's a lot to be said as what we as adults do was, you know, initially seeded in us when we were that little. And I didn't know that for the long time, because a lot of times you can look at yourself and say, well, you know, why do I feel a certain way about money or why do I, you know, some people really think that? I think it's evil or, you know, or they're afraid of it or that gives them anxiety or they don't want to look at it. You need to kind of sit down and do a little bit of looking back and understanding, like, you know, what was happening? What you know, what environment were you in? What messages were given to you? Look at your parents, right? Look, look at your siblings and that hopefully will start to give you some idea. So if anything, if you're in this early phase of raising kids, definitely, definitely put more effort. But but more or less, I think all parents need to think about what what right footing do you give to your kids? Because once they become adults so that they're equipped with the right tools.
** Eric **:
So with financial capabilities being the emotions and behavior behind money, what should a parent establish from the beginning when it comes to that with their own child? Or what do you plan to do with your child?
** Anna **:
Yeah, very good question. So I I find that and also looking at adult behavior, right, clients that I work with, I find that having. Systems right or structures in place helps us, you know, stay on the top of these necessary things. So if I think about, you know, my son, who's, you know, he he goes for when we're at the grocery store or the, you know, any other store, he he knows that in order for us to get something or for him to have something, we need to pay for it. Right. So I mean, he goes and grabs my wallet and pulls my credit card. That's all good. We got that down because he saw me doing that, you know, often enough. Right. And I would bring him with me. So I mean, and that's a three year old right brain. This is a three year old understanding of things. But as as he gets, you know, older, like what and I have a particular plan in place, I'll share. But what what else can I teach him? Right. Or what else? What other concepts or tools or structures can I put in place so that he can grow with it? Right. He can practice it. He can get a custom. So one of these for for younger kids, right, when they're just getting exposed to these conversations around money and and they're in there, see their parents deal with it, however they are, you know, they know what to deal with, would be good to start to introduce something called a three jars concept, probably around age four. So that's, I think, as early as I've seen that kids start to comprehend. Although I think, you know, the the buckets or whatever the jars they they could probably come. I'm pretty sure that my son would understand, like, you know, here's where you put the coin. So the three jars concept centered around teaching ideas around. What do you do with the money? Like, once you have it, right, what do you do with it? And and also it gives gives them the practical experience. Like, it's great to give lectures, right? It's great for them to watch videos. It's great to read books. And I do that very frequently as well. My son loves to read books, and I've started to kind of slip in, you know, financial financial books or, you know, topics that would kind of cover that. He doesn't understand a lot of it, but he can count. Right. You have three carats. You have, you know, two carats. What happened to one? So those kinds of, you know, really easy examples. But with the three jars where it gives the practical experience of a tool, someone can start to introduce concepts like, OK, well, we have something right. We have a coin and we have a dollar. What do we do with that? Can we save it? Can we spend it or can we think about others? Give it. So it teaches this concept of basic money management one on one. But how do we make sure that we take care of ourselves? Right. That's for the spend category and cover all of our lifestyle expenses. How do we make sure we think about the future? That's the savings part. And how do we help others? Right. How do we develop this given heart, right? And given mind in these young kids? So I definitely am planning to go on doing that. I advocate for all of the clients who have younger kids to start to introduce that because, again, I like the fact that it gives practical experience that can be carried over because our kids are going to be a lot more equipped with technology than us, guys. Growing up. So they're going to be doing and practicing these money management skills in a different format. But the actual touching of the money and the jars and all of that is really interesting. Interesting to me as a concept, but also practical for anyone to implement.
** Eric **:
Anna shares her practical tips for getting kids interested in finance. Her advice is a treasure trove for early financial education.
** Anna **:
Yeah. So I think also it would be fair to comment on the fact that, and this might be a completely different topic, but not every family sees sort of given an allowance as the practice, right? Right. Like some families believe that you have to earn your money or have to do chores, and that's fine, right? However, whatever you believe is, or whatever you've been exposed to as a child, right? Again, all of these things come from something or an idea that you maybe experienced elsewhere or got somewhere else. So once the child sort of sees something, they're like, oh, I'm going to do this. All right. So the real benefit of this is that the money is coming in. And I think the biggest highlight here is the consistency. So it isn't just that, okay, here, this week you get whatever, the rule of thumb that I like to say, okay, give them as much a week as their age. So, like, if my son is three, right, and we're going to start, like, I'll give him three dollars, right? Actual dollars. So that way he can touch them, experience them, and then stay consistent with that until, like, let's say, he's four. I'll start to give him more. So consistency meaning, it's not just you. You do it this week and you don't do it next week. So pick a date that works for you, whether it's the weekend or anything in between. And every week it's the same thing, right? Because how does that translate into the real life skills? Well, we have to pay our bills, right? It has to be consistent. Every month we get paychecks, every two weeks or once a month we get paid. So it helps them in the future connect the dots there. So as you give them the money, however it is, whether it's an allowance that they get that, just because, or it's something that they have to work for and they have to do certain chores or go to crates. Behind that, not just, you know, here's the money, start to discuss with them, start to have conversations and ask questions, although you can also add stories from the books, right? Maybe reading or videos that they can be watching. So if we're looking at the three jars, right? Let's say the spend jar or the gift jar, like what, you know, why would we put money in there? Like explain to them, why do we put money in there so that in the future, right? And even given practical ways, like take that jar with you, put a dollar in there for a week, for two, for three. We can take that jar with us when we go to the store so that you don't have to pull mommy's credit card. You can take the money out of your jar and get what you want, right? So it introduces sort of that flow of them actually not just kind of, oh, I get the concept, I think, right? That's what they think. But I actually get to live it and experience. Right? So each of the jars definitely needs to have a purpose, right? That is understood by the kids. So spend jar would be, you know, taking it to a grocery store or, you know, whatever it is that they want to spend money on. The gift jar, I would, this is a fun one too, right? Like especially maybe around holiday time or like Thanksgiving, you know, or even like in schools, there's always projects that, you know, require donations or charities. Get them, you know, get them. Okay. This is probably for a little bit older child. Right. Right. But get them, get them interested in, you know, what do they, how do they want to help the world? What are some of the ideas that, you know, or charitable causes that they are excited about? What would, you know, what would make them, what would give them a smile and, you know, and help somebody else? So that might be, you know, a little bit of a research and an understanding in order for them to like, okay, what's the give part. Now something else too, just an example I gave with my three-year-old, right? Just easy $3.00. Okay. So let's say you give an allowance or whatever, they get the money and it's, you know, there you have three jars. I don't think it's, it should be the decision of the child of how they want to spread the money. So let's say one week they decided that they wanted to put more in the spending jar, right? They put $2 in the spending jar versus one. Let them make the decisions on that or next week they're going to sort of reshuffle it some, you know, some other way. That's also really important because it's, it isn't, you can explain to them, here's how it, you know, ideally how it should be done, right? But let them make the decision so that they feel that they're in control because that's the important part, like let them feel it. Maybe one, one week they, for some reason they have an idea, right?
** Anna **:
They understand that maybe they need to have an extra dollar there or two because they're
** Anna **:
going to take that jar for, you know, for a shopping spree or giving spree. So same thing with the savings. That's the, the hard, I think the hardest part for all of us. Everybody likes to spend. Savings. That component of that is hard for adults as well, right? That's where there's, you know, cases of folks having debt and struggling with really managing those, those components of like, okay, here's, I only work with what I have and not more than that. So the savings also would align in, in, in financial planning, the type of work that I do or the focus of it really is designed to help clients understand what the goals are. Like same thing with the kids. If you're saving this money, right? If you're not putting it in this jar and you're not supposed to touch it, yes, that's part of it. But what are you saving for? Like when you talk to them and ask them questions, what are they trying to accomplish? Maybe there is a, you know, new bike that they want to buy or, you know, whatever else, a new PlayStation game or video game or whatever, right? So like give them a visual or something to strive for as opposed to just, okay, you need to save this much, or you only can spend that much. So that flexibility and creativity. Yeah. I think it's, it's really important in this concept, but real life examples win out of all of this.
** Eric **:
So for my child, I, I definitely use the jars, but she has envelopes and one thing I do let her do, I definitely let her divide it amongst by herself, but I tell her, make sure you put something in each envelope and that has been working out very well because at first, you know, she was just putting everything in. I was like, hold on, you need to spread this around, always put something in all envelopes. So right now that's what she's, that's what she's been doing. So after this now, well, after this, using this jar envelope concept with your child, when it comes to allowances, what can they grow into after that? What can a parent look to, to try to get their child on a better path to financial literacy? After this?
** Anna **:
Well, I think, you know, once the child is old enough and there's, there's plenty of actual, you know, tools these days, such as videos or, you know, like one of the biggest ones that I like for, you know, for older kids, not the three-year-old that I have. But so Khan Academy.com has a lot of free videos on, it was started around tutoring kids, math and how to really do well on that. And it kind of evolved from, from just that and really teaching any kind of topics. And so they have a whole section on, it's free resources, just, you know, small, short videos introducing these concepts. So get them to, you know, to actually take it a, you know, a step further, right. And then once they're old enough, right, 10 is not quite, quite old to have their own account, right. Let's say maybe opening an account at the bank, but that's, you know, that's giving like the real life experiences, right. Once maybe they have an opportunity to earn a paycheck, right, maybe they had a part-time summer job. Yeah. Or something that, you know, pays them actual real money, not the ones provided by the parents. Then you can start to, you know, talk about topics such as, you know, what do we do when we make a dollar, right. We need to pay taxes, not just, you know, spend, save and give, because hopefully that concept has been, has, has been understood. But now let's talk about the money that we save. Can we take it to the next level and start thinking about how do we grow it, right? How do we invest what we have, right. The investing concept. Because ideally. Yeah. It's hard to throw it in the jars at that point because nothing really grows there in terms of, you know, or multiplies there, it grows by the amount that you're adding. So introducing concepts about investing, because that's, you know, ultimately what, you know, makes everyone successful. You save, you, you, you work, you earn your money, you save it, you grow it, and it helps you accomplish your goals. So I think investing is definitely something I would introduce. I've something I've done, which probably still very early for a three-year-old to understand, and even a 10-year-old, but, you know, I think parents could be the best examples of, of all of this, you know, just in, in how they treat their finances. So I opened up a, and we can talk about this too, if you'd like, an investment account for my son, because he can't quite, you know, own an account yet, because he's not a, an adult, right. So minors can't have accounts on their own, but something called a custodian account where I picked five stocks that I was just excited about. And I thought, you know, at some point once he's old 200, old enough to understand, I'm like, okay, here's a Disney stock or Coca-Cola, right. Like he may grasp that 10 year old might have a better view of this because, you know, maybe this is we'll watch Disney plus, or we drink Coca-Cola or, you know, you, you could pick any, any, any, any types of investments. So I wanted to start with that and, and, and that's how I seek to introduce the investment concept, right. So here's, here's the consumer side of these things, but here's the ownership of these companies. And that's, you know, this is what it is. What it's doing. So teaching and just really, you know, opening, putting, pulling up your browser, logging into your account and saying, here's what it looks like. This is, you know, we started here every day or every month we get a dividend or, you know, however often it comes. So getting again, that real life experience. And at some point my plan is just let, let him run that account and make the decisions about, you know, what he wants to invest in. And
** Eric **:
The narrative then shifts to a significant chapter in Anna's professional life. Focusing on her association with Main Street Financial Planning, Inc. What inspired her to take this path and dedicate her career to family financial planning?
** Anna **:
Yeah. So I've, I've been mentioned this a little bit already. It's really, a lot of it is a personal journey of, of how, you know, where I come from and how I didn't have a solid background of, of finances and certain mistakes that I've made in my, you know, young adult years. I wanted to be a doctor when I started in college and that never happened. I just, I switched majors along the way and learned about personal finances. And that was sort of the, that what sparked the interest still gave me my satisfaction of helping people. Right. Just like the doctor, except that it was not around their health or medicine, but more around finances. So once I graduated from college and started to pass my career working, I learned about financial services industry is really vast. There's different ways. Yeah. How someone can get financial planning advice. There's a different business models. And so something that resonated with me was I want to work with, with the clients, right. That come for particular advice and my position of giving that advice is not influenced by, by anything else. It's not influenced by the fact that I need to make a commission. It's not influenced by the fact that, you know, I need to sell them a financial product or insurance policy. So I want to have an objective seat. And so. I wanted to be objective. And so I found a business model that supported that, which is called fee only financial planning. There's this, there's a place for everything in terms of buying insurance products or, you know, other financial products, but I want it to be objective. And so I found a business model that supported that, which is called fee only financial planning. And so main street financial planning is a company that, you know, 20 years ago, actually in November of this year, it's going to be 20 years old practice that. And so I it's, it's a company that I own now, but I didn't, it didn't start that way. I was really interested. And I reached out to the owner or founder of it and said, you know, this is the type of work I want to do. And it was still very early on, you know, only four years into the company. And so that's kind of how it all sort of started. So I started at the very bottom, learned about, you know, the, the ropes of how to be a financial planner, how to, you know, how to deliver advice in this fashion and really kept the mission of it's, it's objective, it's, it's accessible and available to everyone because there's still misunderstanding about the fact that. Financial planning, like supposed to be for the very wealthy and not really, it's about, it's for everyone because you need to have the right platform, right? We call our financial plans, roadmaps, money roadmaps for a reason, because everybody needs to have one in order to get to some, you know, some success point, whatever that is, that financial independence. So it's not, it's not just for the very wealthy, they're all getting plenty of advice. It's for regular folks. So I'm passionate about that. I love that idea. And the clients that I work with are just amazing. Wow.
** Eric **:
So now tell, so what, what motivated you though, to keep going on this journey?
** Anna **:
It's just, I mean, it's really simple. It's just the, the more people I can help, you know, the better the world becomes because again, personal experience of not having the right platform. I wish my parents had exposure to this, even as immigrants, right? It's not, there's nobody should be excluded from this. But also seeing, you know, the impact that it makes on clients' lives, when they have the right tools to make decisions, that's, I mean, that my, the way I view money is that it's a tool. If I know how to use it, and that's why kids are so like crucial in this, like, that's why I, we need to develop these skills in them. Once you know how to use it, then, then you, you know, you set up the platform for yourself as an individual and you accomplish what you want. So just that alone is really what drives me. And so at some point it was. There's only so many clients, you know, folks I can help with. So I now have a team of like-minded and passionate advisors who believe in the same, same idea.
** Eric **:
As the story nears its climax, Anna reflects on pivotal moments and milestones that have shaped her career as a financial planner. The journey is dotted with challenges and triumphs, each shaping her professional identity.
** Anna **:
Yeah. Obviously. Just. Just because I spend my, my, my, you know, my entire day looking at somebody's finances, I also have to face my own. So I think, I think the biggest advantage is I don't worry about money. There's definitely times, right, when life gets really busy. And one of the reasons I don't worry about it is because I've got a structure in place and it, it didn't come on day one, it really didn't, and I've made plenty of mistakes along the way. Because I have a structure and I know where everything is at, at any given time, you know, whether I have my phone on me or I can open up a browser, all the bills are paid, all the paychecks are going in the specific accounts. I know how much money I can spend at any, you know, at any given time. So a lot of this is basic stuff, right? Basic financial planning concepts that, and I see a lot of examples with clients, are not quite mastered, right? Just, just because maybe it wasn't taught to somebody. Or whatever the reasons are. So for me personally, that sort of confidence, you know, allows me to enjoy the conversations with clients and not have to worry about, okay, you know, I haven't paid my bills or, you know, there's not enough income coming in. Plus for my family, we're both, my husband and I own our businesses, so we don't get a consistent paycheck. So that's, that's even more amplified in the fact that we need to have a structure in place. We know, we need to know what our lifestyle is like. And, you know, live within that. In order to be, you know, successful with everything else. So that's, that's the one I go by. My structure, my system.
** Eric **:
How about that?
** Anna **:
Of giving your money to flow.
** Eric **:
Speaking of that, now, when you say money flow, what are, what, what, what is that for people who possibly haven't heard of it, or if you're going to try to explain it to a child one day, who's going to become a teenager, what is money flow? Yeah.
** Anna **:
So. It's really, I mean, it's really simple. And it also came out of my sort of own frustrations of how do I make sure that when I get that $1, right, or whatever that number is, right, your paycheck, that dollar flows in the right direction in terms of just like the, the spend given, save jars we talked about, right? Showing the kids how all of the money sort of goes. So the flow in my head was, okay, once they get the paycheck, what needs to be sort of absolutely done with the money? Like, how do I get the money? How do I pay myself first? So I've kind of envisioned it in my mind thinking, okay, I get the paycheck. What am I responsible for? Like over in my monthly obligations, like savings, for example, that's an obligation in my head. Like you, you're just like, you have to pay your mortgage or your rent. You should save, right? That should be like as high on your list of expenses as everything else, more of the, you know, consumer items. So once I see sort of the paycheck and then designate things for fixed expenses, right? Or my standard monthly obligations, then whatever is left over, and this is a good lesson for everyone too, is sort of living beneath your means or learning how to live within your means is when you have fixed expenses covered and you know how, when, when income comes in, it's going to cover that. And then on the other side, you would see, okay, I have this much to work with for, you know, items that are fun or, you know, variable spend. So the flow is just, just step by step process of how you're, you know, every dollar that you get in into your system has a purpose. Same thing after this, just the savings component happens, right? Just putting money in the savings account isn't going to get you too far. What do you do with it after that, right? Like purposely having a structure where, okay, well maybe I need to save it in my retirement plan, or maybe I need to put it in my brokerage account because I have a particular goal and all of this is backed up by financial goals, which are specifically designed to have a dollar amount. So that's an example of what I would do. So I'm going to add a car to my cash to it. So like a really simple example, let's say I want to buy a car in two years from now. So I want to buy a $25,000 car. I have two years to go and I don't have any savings for that yet. So now looking at my income, right, what, what comes in, all the baseline expenses are paid. I know I have this goal, how do I save for it? Right? Right? So now you're going to designate a specific amount of money from your paycheck to reach that goal in two years. So that's really where all of the magic happens, where all of these things are in sync, as well as having reserves for the rainy day. Because I think a lot of us get derailed from the plan when we are kind of, you know, fortunate situations happen all the time, right? Circumstances where you may lose your job or maybe your business is not doing as well and whatnot. So, you know, I can't emphasize enough of having emergency reserves for those kinds of circumstances. So if you're not at that level yet, then that may be one of the line items in your flow system is, okay, how can I put some funds aside for these kinds of circumstances?
** Eric **:
Understood. Yeah. Makes sense. Now, what was your biggest challenge you would say that you've had? What have you had in your journey with MainStreet Financial Plan?
** Anna **:
Interesting question. So when we've, I used to live on the East Coast and that's where we started our company in Maryland. I think the challenging part, and this is all pre, I know now all of us are really familiar with working remotely and, you know, Zoom calls all day because pandemic happens. But, you know, this is 12 years now ago when my husband and I moved to California, so that was not quite, you know, a practice, you know, for client meetings and interactions remotely, right? Everybody wanted to come to your office and meet you as a financial planner in person. So I think the most challenging part for me was, and I traveled quite a bit back and forth between East Coast and West Coast for client meetings. So kind of, you know, getting to a point where how can we work with clients and we do now, which is obviously pandemic helped. Yeah. But to a point where it doesn't, it doesn't need to be an in-person meeting. The client really needs someone like me, right, or financial planner, because they need help making a decision. And if I can give them the right platform, which is the financial plan, right, or roadmap, then all they need to be able is to get ahold of me and, you know, ask questions if they have them in order to make that decision. So more streamlining of our operations and being able to work with clients remotely, I think has been the biggest challenge. And I think that's been the biggest struggle, but yet the biggest accomplishment so far.
** Eric **:
I hear you. I do, do hear you on that. Now, the thing is, what is your ultimate goal that you're trying to reach with Main Street Financial Planning?
** Anna **:
Yeah. Well, I'm when I, when I purchased the company from our founder Jim I had the, the goal that I set was to in the type of business that I have now is it's, it's quite uncommon. You see. There's a lot. I mentioned sort of the landscape of financial services, so it's a lot more common for financial planning firms to possibly manage assets, right, or be portfolio managers, which tailors to a completely different group of people, right, because not everybody has enough assets to be managed. Correct. And so if they don't, then that kind of like excludes them from the services, right, from being able to qualify for an advice. Right. So I'm on the side where I don't really care what your assets are, it's the problem and the challenges you have. So it's a completely different approach or, you know, business model. And so my goal is, it still is my goal, I haven't quite accomplished it yet, but to have, you know, to grow my team, right, because we really started with just the two of us. There was the founder and then I was the assistant that grew, you know, into a financial planner and then the owner of the company, is to have 10 folks like me, right, like it was impossible to do. To think like, wow, can I have 10 other advisors like me doing the same thing? Because I do know that it's very much needed. There's a lot of people that need help, but they don't qualify, right, to go and get services elsewhere. Right. So that's been a very interesting journey and we're in the midst of it, about halfway into my goal.
** Eric **:
And I think that is very interesting too, because that is a common thing amongst adults is that they're not going to see a financial planner. They feel they don't have enough assets and it's like, I'm not going to go, I'm not going to invest my time and money to that because I don't have enough assets. And that is majority of the nation, but you still need to plan no matter what level you're on. Definitely kudos to you and your team for trying to address this problem.
** Anna **:
Thank you. We're working really hard for sure. And the good part about this is that we all enjoy it and it's a, it's a happy work. So I love it. I love the planning part more than really personally, more than investment management side of things. Yes. We talk about investments because it's really important, but it's a lot more fun to talk about goals. Don't you think?
** Eric **:
Definitely. So what is the best thing that has happened to you since you started this journey?
** Anna **:
I think, I think having my son definitely has been sort of the, you know, the product of all this because we waited a while to have a family. And so I think I'm a different, you know, definitely a different person. Cause I put, you know, put career first for a reason and yeah, I'm, I'm, I think I'm a lot more mature mom if I, if I had him when I was in my twenties and definitely, yeah, I think that's probably the best.
** Eric **:
What do you love most about being a financial planner?
** Anna **:
The best part is when I have a client that comes back, right. For updates and reviews and I get to hear about not just like, Hey, I've my bank account is up by. This much money or my investment account grew by this much percentage, but that's all great. We look at that, but it's more about, Hey, I was able to reach my goal. This is what we said initially, just like what I was describing with the goal I set for my, for my business, right. For, for the company and I'm halfway there. Same thing with the clients. Like that's the best. I was able to take the vacation and we bought a home that we've been saving for like along the way. Right. I get to see behind the scenes and the struggle. But when they get there, it's. It's just. It's just as rewarding as it was your goal. So I'm a little selfish there, but imagine how many clients I have.
** Eric **:
All right. So. All right. So let's paint. Let's paint your picture here. I'm a brand new parent. My child is about one and I'm coming to you now and I want to start an account for my child. What can I start with and what kind of investments do what needs to be in it or what kind of, how much money do I need to put into it? Or, or so on and so on.
** Anna **:
Sounds good. Eric. Okay. So let's talk about, um, a couple of things first. What are we trying to accomplish? So what is our goal if we're trying to save, and I'll give a few examples, cause there's a few accounts that I think parents need to think about opening for their kids. So if I'm assuming you want your child to get really good education and ultimately go to college, correct. So that that's every parent's goal. Um, I should know. So if that's the case, then maybe perhaps we should talk about, uh, college savings account. They're known as 529, 529 plans there exists in every, every state has 529 plan that you can select, or you can actually go and, you know, choose one from another state. So it doesn't have to be one, one in the particular state that you live in. So the goal with the 529 plan and why they are, are great additions to your, you know, to your accounts. And especially when you have a one-year-old or, you know, the, the very young child is because every dollar that you save in that account is obviously specifically earmarked for education, college education, and recently tax laws had a lot now allows for parents to pay for private school. So that's really exciting news because you know, some, some choose to have private school, but what's really interesting about this is all the money that grows in that account. And if you think about your one-year-old. And by the time they get to 529, 529. They need the money for college is 17 to 18 years from now, right? For the first year, all of that money in that account grows tax-free. So a lot of years, right? Of compounding interest, hopefully investing by not just the savings account, but in investing the funds gives you that advantage of the tax-free growth. If the funds are used for college related expenses, and there's a very wide list of, you know, other things that could be used for tuition, it could be used for room and board. And some of, you know, some of the other things. So if your goal as a parent to make sure that you have enough resources for college education or private school down the road, that's a very first thing to, to think about. I used to, in my early, earlier days as financial planner, I used to volunteer for Maryland when I used to live in Maryland, Maryland 529 college plan. And so I would go to elementary schools and I thought it was quite late to talk to parents, you know, of elementary school kids. I mean, it's still okay, but I shouldn't be talking to, you know, folks at the nursery when they're giving, you know, birth to kids, Hey, you should be opening 529 accounts. So I would give presentations about, you know, what these accounts do and how they work and you know, how the, how parents can start with like as little as $25 a month in, in saving, right? Like, you don't think you need, again, a ton of money. You need to start with a little bit in order for it to accumulate for you over time. And it's, it's also like, when you look at your one-year-old, you're like, all right, where are they going to go to Stanford? Are they going to go to, you know, where they're not going to go to college at all? So it's like, it's a big unknown, right? You don't know what kind of dog they're going to grow into, but at least the time is on your side. And that's really like the secret sauce of investing. The more time you have, the better you are, right? Because it lets the funds grow. So I would, I would definitely think about 529 plan.
** Eric **:
Now, since the 529 plan is a. A plan you can only use for education, then you'll, if you use it for something else, you'll get, you'll definitely get a high tax on it, probably 20%, if I'm correct, if I remember correctly.
** Anna **:
There's yes, there's tax, there's a, there's penalty for taking funds out if it's used for something else. And then tax would depend on your, you know, your own tax bracket, but yes. Correct.
** Eric **:
So now I want to keep going and I'm, I've opened a 529 plan. Now I want to keep going in and help my child out even further. What else, what other account can I open up for them that will help them have some money that's growing and they could probably take it out when they turn an adult, maybe 18 or 21. Yeah.
** Anna **:
So let's, so there's probably two that I'd like to talk about here. So, and as still, I still think of myself as a new mom, right? Like there's all, there's a new day every day of raising, raising each other, but you know, initially. Okay. Like you get all of these gifts and, and, you know, baby shower and all of that good stuff. And then the first, first birthday comes around and we got so many gifts too. And it's like, oh my God, my house is just like exploding with toys and so you start to think like, all right, I don't need any more of that. My child doesn't need more of that. We've had, you know, we've had a fill for that, for that. So I would start with something simple as a savings account. And. If you get it. And sometimes, you know, some families are smarter than others, right? Sometimes they're like kind of realized that, or if they had experience or if you have siblings who had kids already, they're like, you kind of seen that. Um, I sort of, I mean, I knew this professionally, but I saw a real life example with my brother when his, he and his wife had kids, they're a little bit older than Liam. And I just, I saw that, um, you know, all the, the, the toys and everything that all the gifts that they've been getting. And so like, all right, well, we need to do something else. Um, and so here's the money. I don't want to buy the toys. Why don't you put it in a savings account and, um, keep it there. Right. Um, and, and use it for, you know, whatever else you may need down the road, but hopefully it's a long-term play. Now we're, we're in our conversation, we've, we've talked about how saving something isn't going to multiply, right. Or grow the money as fast, but that's not the concept here is how do we get from the consumer sort of mindset of like, we need toys, we need clothes, we need all of this. Yes. You need that. You don't limit to where the money is put to work. So savings account where obviously you as a parent have to be the primary holder, but it's, you know, custodial savings account. You can any, you know, fair amount of banks allow for those. So any gifts and I, you know, I tell friends and family like, look, um, we don't need any more toys. We're good. So here's, you know, you can just, you know, whatever you want to give, give us cash and we'll just put it in that account. So that just gives you that much more freedom. I've seen with clients too, over the years, they would come for, you know, their kids are like five or 10 years old and they're like, I have the savings account that I've been sort of hoarding for my son. What do I do with it now? That could be a really good seed for 529 plan. If you, by then, right. If your child is a little bit older, you can put that money in the 529 plan because limits on 529 plans are pretty high in terms of what you can put in it. So don't, don't underestimate the fact that just because. You don't know what you're going to invest it for just yet, keep, you know, keep accumulating it. And then at some point something will become more visible, right? Maybe you would want to spend it for education, right. Or a private school or a camp or something that's a lot more significant than a whole bunch of toys. Right. And I don't want to kill all the toy lovers. Believe me. I love the toys.
** Eric **:
It's all good. But to a certain degree, right. It's only plastic.
** Anna **:
Something else. Something else. Yeah. Something else as well that worked actually, it's magic for my family. And I had been advocating this for years. Tell grandparents, and they're the ones, they're the, the, the, you know, the makers of all the gifts, you know, for the most part, right. Cause grandparents are at that level where they're like, oh, well, you know, we can just do fun stuff. Tell them not to buy it. The things that you don't need. Here's a 529 college savings account or better yet, they can open the one on their own because there's not only tax-free growth that you get with the 529. There's also tax benefits in certain states. Not every state has this feature, but whatever contributions you put in, you have an opportunity to deduct it on your state taxes. So grandparents might be interested in that, but the idea is that whether they give you the money or they set it up, you know, on their own, it goes to, you know, for some, for some better cause in the form of savings or investing. So ask for that. That's this it's really easy to do. Maybe uncomfortable at the beginning. But you do it once and hey, you say, I, I give this script to clients to say, tell them your financial planner, Anna, um, asked for this. So kind of blame it on me. So you guys are all allowed to use me as your financial planner and say, Anna suggested we put this money in the savings account as opposed to buying toys. Right.
** Eric **:
Definitely. Definitely. So you said that, you know, using, uh, the savings account. As a sort of kind of a budgeting tool in order to accomplish other goals, like putting it into 529 and to other, uh, places. What kind of account can I start for my child that it'll grow with investments inside of it? Yeah.
** Anna **:
So for, so once we take this a level further, we would talk about, um, what's called a custodial account. Mm-hmm . And there are, you know, they're different. There's two different types, just depending on what type of investments you wanna, uh, select for those accounts. So there's UTMA, uniform transfers, gifts to miners act. It's really complicated. So UTMA or UGMA, and it's something uniform transfers, gifts to some similar structure. But the two, the difference between the two is one allows you to invest in like really sophisticated things like real estate or commercial buildings or gold coins. Mm-hmm . Or collectibles, right? Mm-hmm . The other one is just a simple investment account. Custodial means you're still the one who's responsible, you know, for the account until the child reaches, uh, age of majority, right? Right. And, and that becomes theirs. Right. So the other one is just, like I said, simple account. You can invest stocks, bonds, anything, you know, anything that, that the, you may already own in your account. So it's just the difference. But what's neat about this, and this is, I mentioned this before, this is what I started for my son. This is my son where I picked five stocks for him and, you know, just let it grow. It wasn't a huge amount there that I put in there, but just like, okay, at some point I want to show him that and say, here's how it works. Here's the Disney stock. You watch the, the Disney, it lasts a lot. This is how, this is where it's coming from. You actually own the company there. Right. And so that's my vision for, for it. I, you know, obviously it will grow over time and, you know, any access, I have all three accounts, um, in, you know, in, in my family. Right. And so any access funds that are, if we, if we don't need any more in the 529 college plan. And by the way, keep going. I, I love 529. I don't know if you can tell. I keep coming back to it. Um, no, I do. I think it's a great tool and every parent needs to think about that. If at some point in, in what I wanted to say in terms of 529, revisiting the financial goal of, you know, what college they may want to go to. If at some point you feel like you, you're, you're good with the 529 contributions, then, you know. The money gets, the money that you intended for that maybe can be either put in a savings account, right? Custodial savings account, because that may fund something, you know, along the way that's not college related and then whatever else is still remaining can go into the investment account. Right. So kind of just a little bit of a structure, like, all right, I have a hundred dollars or I have a thousand dollars that I can devote to this. Like what is my sort of priority? So kind of give yourself that breakdown. Similar to spend, give and save jars. But this is for adults, right? College education fund stuff for like midterm goals in the savings account, and then like really investing in the custodial account, because that's the money that they can down the road use for, they can use it for education that if they, if they want, right. At the age of 18, it's theirs, their decision to make what they, what, what they want with it. But also, you know, this could serve as a down payment on the home or business, you know, funds to start that. I mean, anything really, but, but it's just, it's a little bit better than just a savings account.
** Eric **:
What is the best piece of advice anyone has that you could give any parent out there trying to get their children involved in finance?
** Anna **:
I want you to lead by example. Like I think a lot of parents and maybe doing some, some work on your own ideas around money or, you know, how you sort of, look at your own stuff. and figure out, you know, how you can be better. But I think a lot of parents don't lead by example. And so being open about what you got, and it does scare me when I say that, but that's my intention with my son too, is, you know, here's all the, you know, here's at a certain age, right? Like at some point there will be an old enough to understand what's happening. But I think that's the best example is when you can be truly honest to them and lead by example and say, okay, yes, mom and dad have made certain mistakes and this is what we've done, but here's, you know, here's how you can do it better and we can show you that. I think that's ultimately, you know, the best example, because once they grow up, they're gonna think about that, right, as a seed of making decisions and hopefully teaching the next generation maybe to do better than they've done themselves.
** Eric **:
What should a parent start doing today, right now?
** Anna **:
Sit down and have a conversation with your kid, whatever the age they are, what do they understand about finances? And if they do, if they're a little bit older, start to introduce these concepts. Like that's, I mean, as easy as it can be. I wanna invite you to have a money date. That's something that I have advocated for years and teach clients to do. I have money date with my significant other. You can have a money date with your child. I think it's a fun, you can have ice cream and, you know, have a money date. Like find creative ways to have conversation about money. Talking about it is already half the battle because some of us don't even wanna talk about it and put our head in the sand. So, if anything, have a money date. I think they would love that concept. It doesn't have to be just adults. It can be kids.
** Eric **:
Alright. Definitely, definitely. So, Anna, I wanna thank you for coming out, Coming on the show, can you let us know how we can continue this conversation with you and let us know what you may have going on in the near future?
**Anna**:
Yes, totally. Thank you so much for having me. So I have a podcast just like you, Eric. If you guys are interested in listening to more of these kinds of conversations, I certainly am focused on advocating for the parents, and I have exciting guests that are joining me as well. My podcast is called Money Boss Podcast. So whatever platform you're listening on, you can find it. I am also on social media. You can find me at Money Boss Parent. And exciting project that I'm working on that is a masterclass, I'm teaching an online 45-minute masterclass for parents of how to really focus on their finances, not for the kids. But what are some of the main and the most important things any family needs to have in place in order to know that they're on track with their finances, you know, wherever that you are? How do you put the right protection in place? And how do we actually have fun doing it? Because sometimes I feel like we're all sort of over-worried about saving, saving, saving, not spending, spending, spending, but we need to have fun along the way. So I'm teaching a web class on how to do all of that. And you guys are invited.
** Eric **:
As our journey with Anna comes to a close, we're going to have a little break. And then we reflect on the profound insights and personal stories she shared, illuminating the path to financial literacy with the warmth of her experience and the wisdom of her profession. Her tale is a testament to the power of integrating life's roles to foster a deeper understanding of finance, from the broad avenues of California's economy to the intimate interactions within her family. We invite you to continue exploring the narrative.
** Eric **:
Thank you so much for joining us today on Raising Financial Freedom.
** Introducer **:
We really hope you enjoyed this episode of Raising Financial Freedom, the podcast. Stay connected with us directly through RaisingFinancialFreedom.com. You can also join the discussion on social media, which you can also find with the link on our website. If you would like to speak with us, please send us an email through info at RaisingFinancialFreedom.com. And as always, thank you for pushing your mindset towards a better reality. This concludes the most thought-provoking portion of your day. Don't forget to please like and subscribe to stay fully up to date. Until next time, be kind to yourself and each other.