Podcast 104: Money Confidence for Real Life with Katy Song

Steve Chen (00:00:06):

So welcome to Boldin Your Money. I’m Steve Chen, your host. I am joined by Katy Song, a certified financial planner who also happens to live here in Mill Valley, which we discovered when we met. She works with younger families, with kids, and we’re going to talk about how financial planning is evolving, why she got into it, especially what’s happening with flat fee planning and technology. So with that, Katy, welcome to our show. Thanks for joining us.

Katy Song (00:00:38):

Thanks, Steve. Good to be with you.

Steve Chen (00:00:39):

Yeah, so we’d love to, for our guests, it’s kind of understand more about how you got here, why you got into this line of work. So a bit about your journey so far.

Katy Song (00:00:50):

Yeah, so I got my MBA at Berkeley, and then after I finished my MBA, I went into investment banking, which why not? So I did that for a while and I focused on technology companies and then I was starting my own family. So I had my first child in 2007, took my maternity leave, and then on my way back from maternity leave, I used to do a lot of travel for work and traveling to India and Asia is like par for the course. So they wanted me on a plane and I had a four month old that didn’t take a bottle. So those two things as a new parent just do not coincide. So I kind of felt like the universe was giving me a strong message that it was time to pivot. It was also 2008, so I don’t know if people listening to this remember how the market felt in 2008, but in baking, it’s one of those things that where most people hold on until bonus time. And I was just like, first of all, I don’t think bonuses are going to even happen, and why am I going to do this? I’m going to leave my baby at home to starve to death. So that wasn’t going to happen. So I met a woman in San Francisco and she was a certified financial planner. And honestly, Steve, I had never even heard of a CFP before, and this woman was joyous. She was so happy and I was like, whatever you’re doing, I want to do.

(00:02:07):

So I started working for her. I started working for her and ghost writing plans and building financial models for her and studied for the CFP exam passed it became a CFP. And I’ve always been a CFP and a registered investment advisor, but unlike 99% of my industry, I do not manage money. So that kind of makes me the unicorn.

Steve Chen (00:02:31):

And I remember when we first met, that was something that was really unique and it continues to be really unique, the core business model for most of this industry. And so why was this what the person you’re in San Francisco was doing too, or why did you go to fight?

Katy Song (00:02:48):

Yeah, she was also doing that. She’s not a financial planner anymore. She kind of focuses more on the marketing side. I always did this because the people who, I mean, I was a 3-year-old with a year old, we don’t have any money to invest. We were hoping to renovate a bathroom, maybe buy a car that was big enough for a stroller. So the people that I wanted to help weren’t the people that had hundreds of thousands of dollars that somebody was going to pay attention to and help them invest it. And for families starting their lives together, which is what I’ve always focused on, or couples starting their lives together, they need holistic financial advice that’s practical to help them have confidence in their decision making. So that’s why I always did what I did.

Steve Chen (00:03:32):

Got it. And I feel like this was such a, I remember just personally, I had a similar kind of experience when I was in my thirties or whatever. There was a person I know who was probably 10 or 15 years old than I was, and I saw him coming out of his house. He had a house in San Francisco, had some kids and a Porsche in the driveway. And I was like, how does this happen? I actually asked him that. I’m like, how did you get here? And actually what he said was kind of funny, and I also was like, how do you pay for it? He’s like, well, when you have kids in this life, you figure it out. You have to make it work. But I also feel like there, there’s some storytelling and I mean this happens for people, not everybody, but for some people they figure it out, they make good choices, and then they end up 15 or 20 years later, they’ve really made it. But I think a lot of people don’t know what that journey is. I mean, is that what you find?

Katy Song (00:04:30):

Well, I feel like so much of it depends on your earnings to live in the San Francisco Bay area or pretty much any major metropolitan area. When I first started out, you needed to make 200, 250, 200 $50,000 to live a life in one of these areas, and that was in 2008. It’s now up to around 3 25, 3 50. So that’s what I find. If you want to own a house and you’ve got kids that require childcare, if you think that as a couple or as a single parent that you’ve got to make $350,000 just to break even, that’s not even saving. So for the guy who has the Porsche and the kids leaving his house in San Francisco, his earnings were probably exceeding what it was taking to break even. And so a lot of people don’t even know what that number is for them, what their lifestyle is. It’s so easy to fall into lifestyle creep and seeing what your neighbor has. How do they have a nanny? How do they have a house in Tahoe and overextend yourself.

Steve Chen (00:05:31):

Yeah, I think for a lot of people hearing this is even for me, those are big numbers. And to think, and I do see this, I mean, I’ll say living in Northern California, incomes are higher. If you work in tech or finance, maybe that’s happening for you, but it does feel daunting to say, Hey, I have to make this kind of money and that’s what it is to accomplish the goals I want to accomplish. I mean, do you see in your practice a lot of people doing this and making it happen? I guess you must

Katy Song (00:06:06):

I, so I have clients since I don’t manage money, I don’t have minimums, so some people can have negative net worth. So there’s no problem to weird for me to try to solve. I have clients that are both nurses or physical therapists or teachers, and they find a way to make it work. You can’t spend as much money. And around here, a lot of my teachers, they bought their houses 20 years ago for two teachers trying to buy a house in Marin County where we are right now, it’s virtually impossible.

Steve Chen (00:06:39):

Yeah, right. Yeah. I think in general, the whole American dream is still for a lot of folks, it is buying a house. Although for many folks that will reframe it, I mean, I know some fire folks like Andre Nader, he is like, I rent and I invest it all. And that’s a smarter decision for me. So I do think it’s also possible, and you have to be smart about, do you want to sign up for a six or 7% market rate? And if you have a 3% mortgage rate, can you afford to get out of that? You kind of want to maintain those kinds of things.

Katy Song (00:07:14):

Well, and there’s a lot of flexibility that comes with renting. I used to live in France when Trump was first elected. I moved over there for four years and it’s an American thing to own property. Some of the people there, they do because their families have owned houses for hundreds of years, but owning isn’t kind of the ultimate goal. And so I have a lot of clients that come to me and they’re like, we want flexibility. We want adventure. We want to be able to move to Hong Kong for three years or quit our jobs and do a micro retirement. Owning a house is in conflict with those other goals.

Steve Chen (00:07:48):

I do think it’s pretty interesting if you can reframe. A lot of times you kind of get very locally focused. That’s where your community is and your friends are, and your schooling and your kids and all that stuff. But if you can zoom out and be like, oh, I moved to Portugal, or I live in France, or I’m going to South America, it can be way cheaper. I mean, the cost of living arbitrage even in the US is huge.

Katy Song (00:08:14):

Yeah, I mean, I found that living, we lived in Bordeaux, France, that it was a third of the cost of living. I mean, that’s tremendous, but also there’s been a ton of research done for the boomer generation and retiring showing that the happiest retirees are renters.

Steve Chen (00:08:29):

Really?

Katy Song (00:08:30):

Yeah.

Steve Chen (00:08:31):

Why is that?

Katy Song (00:08:32):

I think that you don’t have, mean, part of it is maintenance and upkeep. So you can have the flexibility of not having to put tens of thousands of dollars into maintaining one of your biggest assets.

Steve Chen (00:08:45):

That’s fair. Well, ultimately, I think caregiving is becoming, this is something that’s become a much more real topic in our business. People are with their parents dealing with it, and it’s like you’d essentially become a renter at that point. You might sell your house and maybe it’s a pseudo ownership thing, but it’s mostly like you’re paying rent. Totally. And with some level of services packaged up with that from assisted to nursing to memory care or whatever it is.

Katy Song (00:09:13):

Yeah, I mean, it does become hard. I mean, kind of with the sandwich generation, when you have an 85, 80 7-year-old parent that may be kind of showing signs of dementia and you’re like, okay, we may have to look at some kind of assisted care for them, but they’ve got this 1.5 million house in Danville or wherever it might be. What do you do with that asset? They bought it for $40,000 50 years ago. They have this huge capital gain. So I help my clients figure out what are the pain points and what do you do? Do you try to rent out your mom’s house? I mean, that could be a very painful process because there’s a motion tied to it. There’s cleaning it out. There’s like, how does this even work? But then how do you afford assisted care if you don’t monetize that asset?

Steve Chen (00:09:57):

Right. Yeah. Are you finding that within your practice you’re helping people? Are they thinking intergenerationally?

Katy Song (00:10:03):

Definitely. It’s definitely been more of a 2025 trend. It’s been more like this year than any previous years. I normally don’t work, like we were talking about earlier, I focus on families with young children and couples starting their lives out. But now I’m working with a lot of my clients that I’ve worked with for a decade. They’re coming to me now saying, Hey, can you help my parents make this decision of whether or not they should sell their house and what they could afford? I mean, recently I had a client that was still paying. He’s in his eighties and he was still paying whole life insurance premiums, and it was causing this huge cashflow suck. And I was like, you are making yourself so stressed out for what to buy to pay up a little bit more whole life insurance. You have plenty of money. Let’s do some paid up policies and stop paying these premiums. So sometimes the advice is easy,

Steve Chen (00:10:56):

And we did this with my mom. She had a term life insurance and we’re like, well, let’s give it up. We don’t need this. It’s going to pay out a hundred grand and this point, this doesn’t matter. And I think you have to be smart about insurance and do you use it as a vehicle or do you just kill it? All that stuff. Yeah, it’s so interesting. So are your customers, are your clients mostly here or are they all over the place?

Katy Song (00:11:21):

They’re all over the place. Yeah. So I mean definitely there tend to be more in metropolitan areas. I do have a lot of Bay Area clients just because this is where I was based and I started in 2008 before we were as virtual as we’ve become now. But yeah, I’ve got them in Arkansas, Florida, you name it, Minnesota, Michigan, all over the place.

Steve Chen (00:11:43):

How do they find you?

Katy Song (00:11:45):

A lot of them are on podcasts. They hear me on a podcast or they read about me. I tend to be in, one of the main groups that I help here in the Bay Area are moms in tech. So there’s a Facebook group called Moms in Tech. It has a pretty robust following, and these women tend to be the primary earners of the family and they’re juggling being moms. So I was getting so many calls from the same type of woman, which is why I wrote my book Financially Fearless Tech Moms Guide to Money, because I couldn’t help everybody. So I decided to put everything in my brain and what I do in this book to provide a framework so that anybody who’s a DIYer who wants to be able to do this on their own could essentially just follow the book and get the plan that I put in place for them.

Steve Chen (00:12:37):

Awesome. We’ll definitely link to your book. Yeah, I was curious about that. So it’s interesting that they’re the primary breadwinner. It is so interesting how it’s changing, right? Women are 60% of the college students now-ish, right? They’re graduating, they’re getting STEM jobs, and definitely it’s shifting.

Katy Song (00:12:59):

I noticed that the switch really started about nine to 10 years after I started becoming a financial planner. So I started in 2008, I think it was 2017 ish that it used to be the majority of the calls that were made to me were from men. And then around that time it switched to mostly women, not mostly, but majority

Steve Chen (00:13:22):

Nine years ago.

Katy Song (00:13:23):

Yeah.

Steve Chen (00:13:24):

Okay. And then is the trend continuing? Is it, I don’t know if you keep track of this, but it was whatever, 30, 70, 50 50. Is it now 60 40?

Katy Song (00:13:35):

Yeah, it’s kind of 60 40. And I do think that inevitably with aging as all getting older, and I’m sure you see this just with people that you talk to, but there tends to be, especially with people who are working in the technology space or even marketing or advertising, we’re in a contraction right now. There are people that are losing their jobs. And what I’m finding is my clients that are men in their fifties are struggling a lot more to find a new job. And when they are finding the new job, it’s taking nine to 12 months to find it. And in most cases, they are not being compensated at the same level as they were in the job that they left. However, my women clients who are also laid off tend to find new work between three and six months. So I do find it very interesting.

Steve Chen (00:14:27):

That is fascinating. That’s interesting. So same age groups?

Katy Song (00:14:32):

Yes, around the same age. Sometimes the men are a little bit older,

Steve Chen (00:14:35):

So men is taking nine to 12 months and women is taking three to six,

Katy Song (00:14:39):

Three to six,

Steve Chen (00:14:41):

And men’s comp is lower. And how about women’s?

Katy Song (00:14:44):

Yeah, no, it’s pretty much the same.

Steve Chen (00:14:46):

Okay.

Katy Song (00:14:47):

Well, I mean I have 700 clients.

Steve Chen (00:14:49):

We got to run a survey. We’ll have to run a survey on our side too. We are surveying our users now in a much bigger way. And yeah, that’s amazing. Good. Wow.

Katy Song (00:14:58):

So I feel like my younger clients are motivated to figure out, okay, how do I make these finances work? How do I maybe not buy the PORs someday? Maybe something a little bit more affordable, but how do I make this all work? And then we’ve got this newer issue with people more approaching retirement, which is like, what is my enough number? And I mean, you work on this with your company every day. What is the enough number and do I have to find the next job? I mean, the goal would be work optionality. I mean, that’s what everybody comes for. Even my clients in their thirties, they’re like, how long do I have to do this? How long do I have to work at Meta? How long do I have to work at Google? How long do I have to work at Amazon? And so it’s always my privilege to help them figure out that number and be like, okay, this is your enough.

Steve Chen (00:15:48):

I think Google Meta and these companies need to figure out how to make their customer, their employees so happy that,

Katy Song (00:15:55):

So if they provided financial planning, I mean, that’s why I think we do what we do, which is if you are able to give people clarity and peace of mind, you can live with a better life. You have this one life to live. And so if you want to live the best version of yourself, you can’t be stressed out about money. I mean, it’s such wasted energy. And the majority of people in America are stressed about money.

Steve Chen (00:16:25):

A hundred percent. Do you ever watch the soap opera one? Life to Live? Never heard. Yeah,

Katy Song (00:16:31):

No. When I was a kid, I just remembered that one. I was more of a guiding lay type person. But

Steve Chen (00:16:38):

What happened to soap opera? We need to up sun on soap operas. They even exist anymore or what? I don’t know. I

Katy Song (00:16:44):

Don’t know.

Steve Chen (00:16:45):

There’s different versions of them now. It’s like Real Housewives of blah, blah, blah, whatever.

Katy Song (00:16:49):

Yeah, I can’t do that. It’s

Steve Chen (00:16:50):

Reality TV versus

Katy Song (00:16:52):

That’s time I cannot get back. I don’t see you spending your time watching that stuff either.

Steve Chen (00:17:00):

When we were younger, we don’t have the same access to all of the things, ways people can waste their time. Now, that’s the other problem. I can do a whole other podcasts on devices and kids. We can hold off on that. Okay, well, this is really interesting. I mean, so do you see your clients then? It sounds like they’re really thinking about this stuff strategically and aware of the clock as well. I think that’s something else. Like, hey, I’m 35 a high income earner, but I might have a past due date to 50 years old as a male. I got to make it count next 15 years need to count. I need to save a lot of money, put it to work, make good choices. I think that probably makes it very more real for people.

Katy Song (00:17:48):

Well, because there’s actual planning to do. It’s not like this hypothetical, theoretical like, oh, someday when I’m 80, what is my social security going to be? We’re talking about the now, which is like, I mean everything tactical from do I do, and these are the questions I get all the time, should I be doing the mega backdoor? How do I fund that? What about the ESPP? What about my RSUs? So these are companies that have equity compensation, which not everybody has. Once you get to a certain level, do you have deferred compensation programs? Should you be doing it? What kind of distribution strategy do you want to do? But even for my younger clients looking at equity compensation or bonuses, the goal for all my clients is how do we get you to live on your base income? Is it even affordable? Which means that if you get a bonus or if you get equity compensation, that’s all gravy. Then the question is, for all your financial goals, we have to put a price tag to them. And depending on the time horizon for each of those goals, that is what determines how we invest it.

(00:18:52):

So is it a five to seven year time horizon? Is it a 10 plus year time horizon? And it makes that once we define those parameters, it makes investing the easy part. That’s super easy. I mean, I’m a big fan of low cost ETF portfolios,

(00:19:12):

So I’m not cherry picking individual stocks. I try to get my clients away from doing that just because there’s business specific risk and I don’t want them to be overly concentrated. I mean, there’s so many people that are freaked out about, there’s some people that are really freaked out about AI and other people that are super gung-ho and they’re like, okay, how much should I put into ai? Should it be 20% of my portfolio? And then other people that are like, I want to short it. How do I get out of it? It’s going to collapse someday. And then everybody’s freaking out about government debt and the shutdown and you name it, what’s going on right now? So how do we reposition your money for your goals and just give you a peace of mind? Okay, this is why we’re doing what we’re doing. Don’t react, especially don’t react emotionally. One of the things you and I had talked about before is what are the mistakes that people commonly make? One of them is emotionally reacting to what’s going on in the market. So this year has been pretty amazing. The number of people that have come to me that have put every single penny of their retirement account in cash,

Steve Chen (00:20:20):

This happens.

Katy Song (00:20:21):

Yeah.

Steve Chen (00:20:23):

And what do you tell them?

Katy Song (00:20:24):

Don’t do that. Please don’t do that. Let’s get it redeployed. And then people freak out about timing the redeployment of it, and statistically it’s better just to get it reinvested, reinvest it, right? Because you’re never going to time the market perfectly. So that’s one new mistake that I’ve been seeing in 2025, a lot more than I would like to see it, but the are coming to me, they don’t know what to do. So it’s not existing clients that would really concern me if it were existing clients.

Steve Chen (00:20:54):

Well, I feel like this is something also you have to live through to some degree to really understand. I mean, I’ve lived through 90 19 99, 2008, like 2020. It’s like you realize that it’s going to happen. Corrections will happen. You need to be comfortable that your paper value could go down 20, 25%, but then have the fortitude basically look at the long-term chart. Okay, these are little blips, but if you look at this over a 20 year period, if you’re not in the market, you’re going to get crushed too. I think that’s something else I had to really learn. I was like, oh, I was a good saver. I only share this in the spirit of helping people, but I wasn’t fully invested all the time and making some of the mistakes you’re seeing. And now I’m a index and chill just in the market and I don’t have a think about it.

Katy Song (00:21:48):

Okay, I love that index and chill. That should just be the motto. So yeah, a lot of people freak out. I understand the emotional reaction, especially if you’re super close to retirement, but that’s why, and usually my clients are not at that retirement stage, but the rule of thumb is to have two years worth of your spending in cash and equivalence if you’re about to retire anyway. So that way you’re not having to time the market to sell a bunch of stuff when it’s 20% down. I mean, November, 2021 was icky. Nobody wanted to sell stuff then. And you just want to have enough liquidity that you don’t have to sell when the market is tanking.

Steve Chen (00:22:31):

Right. Well, and also to be honest, the real opportunities are when there’s quote blood in the streets. 2008, 2009 was the buying opportunity of a lifetime.

Katy Song (00:22:45):

How about people who bought houses in 2010, 2011? I mean, fantastic timing.

Steve Chen (00:22:52):

That was one of the good financial moves that I made. We made was that when you bought, we bought our house in 2009 and we were going to my house in 2005 and we’re like, felt like anybody who could fog a mirror could get a loan, and we were actually an escrow. And I was like, I’ve worked my whole life to save enough for this and I could have done nothing and just had no savings and just gotten a negative, negative amortization loan. And I mean, people are getting crazy stuff. And I was like, this doesn’t make any sense. I think that’s one thing that normal human beings see, they’re in any market that aren’t in that world. They’ll be like, this doesn’t make sense. And if you can, and hopefully, I mean obviously you should be talking to other people, but that is seeing those things or what they are can be helpful.

Katy Song (00:23:46):

Well, I feel bad for people now because if you’re a young couple and you’re starting your family and you’re like, we really want to buy a house because we want to have roots and we want to have Halloween and we want to do all these great things in our home, and housing prices haven’t really corrected, they’re still super inflated. Interest rates haven’t come down by as much as we thought they would’ve in the last year or two, but people still want to buy a house. So it’s not necessarily a terrible idea.

Steve Chen (00:24:15):

It

Katy Song (00:24:15):

Just means don’t pay a premium to lock in a 30 year rate and make sure this is a house that you can stay in for five to seven years because the transaction costs alone will eat away at whatever equity you’re putting into it.

Steve Chen (00:24:26):

I mean, there is an arbitrage there. It is shocking to me that housing prices have not come down, especially in the Bay Area. But then you also read like, oh, all the open AI is doing secondaries and people are showing up in San Francisco with cajillions of dollars and they’re spending it on houses. But if you get in and then rates come down, you can refi and then theoretically your house buy.

Katy Song (00:24:53):

Yeah, you have to let go of the whole, I don’t have a 3% mortgage though, right? Mean, so most new first time home buyers didn’t get to experience having a 2.25% mortgage, but there are a lot of people that feel really trapped with it. And then the question is, one of the things I help clients with is can you keep your current house and have it as a rental property because it’s super inexpensive to pay the mortgage? Or do we need the equity from this house to buy your next house? And from an outflow perspective, people are going from spending five grand a month on principal interest, taxes and insurance to 10 to buy a new house. Now it’s a lot,

Steve Chen (00:25:37):

But life happens. We have a friend of ours and they’re in Mill Valley and they’re selling their house, which is kind of a, but making changes for various reasons. And yeah, you’re trading away from those theoretically lower costs, but maybe it’s more than you need. And then people want different things in their lives and it’s like, oh, I’m going to go to live in San Francisco, or whatever it is. So life happens to everybody.

Katy Song (00:26:00):

Yeah. I mean, divorce is a big reason for these kind of changes. For whatever reason a separation happens, then all of a sudden it’s the sale of the family house. So I do get a decent amount of people who are going through that process that are asking questions like, okay, can I buy my spouse out of the house? Does it make sense for me to keep it? Okay, we’re both on the loan. I don’t want to have to refinance because we’ve got a really good rate. So it’s strategizing what makes the most sense for you. And I think that that’s where some people who try to maybe either put their head in the sand about financial planning, they’re like, I just can’t figure this out. There are resources out there for people to help bold or a fee only advice only planner like myself to help you figure out your puzzle because there are answers to these questions. I mean, one of the big reasons that I got into this business is because I don’t want people to stress about money. So it’s stress less and live better. That’s what I want people to do. And if you’ve got clarity, and I think this is one of the great things that Boldin does, which is you can see all of your assets and liabilities in one place. So knowing your balance sheet and your net worth position is the first step of financial planning.

Katy Song (00:27:15):

If there’s anything anybody does after this listening to this podcast is construct your balance sheet. You need to have a starting point. So then some people are like, well, I don’t know if it’s good or bad. So there’s not one test that all financial planners use to ascertain whether or not that’s on track or not. But there is one good really quick litmus test. So it’s from this kind of old school personal finance book called The Millionaire Next Door. Did you ever see that in the airports in the two thousands? This is the test. So you look at your gross income and you divide it by 10 and you multiply it by your age. And if that is similar to what your net worth is, you’re on target. If it’s below, you’re not on target and you need to save more. And if you have two times what that amount is, then you’re considered wealthy in this book.

Steve Chen (00:28:08):

Okay, this is interesting. So let’s run the number. So if your gross income is $350,000, so divided by 10, that’s 35 grand and

Katy Song (00:28:22):

10 50 if you’re

Steve Chen (00:28:23):

50, yeah. If you’re 50 years old, then what is that 2 million ish, one and a half, blah, blah, blah. It’s like, no, 1.65. Am I doing my maths?

Katy Song (00:28:33):

I don’t even have a calculator in front of me. Here we go. Bring your phone out.

Steve Chen (00:28:37):

I’m bringing my phone out. Okay.

Katy Song (00:28:38):

Okay. So 35,000 times 50.

Steve Chen (00:28:41):

Yeah, 1.75 million. Sorry. Okay, so 1.75. So if you’re doing that, you’re kind of like on track,

Katy Song (00:28:48):

You’re on track,

Steve Chen (00:28:49):

You’re on track. But if you had two times that, so if you had three and a half million dollars,

Katy Song (00:28:54):

Then you’re wealthy.

Steve Chen (00:28:56):

Then you’re wealthy. Okay. That’s interesting. Yeah, and I think a lot of this depends on, I mean, I think the real question back to the point, it’s like people want to be, I think two things. One is financially confident. Am I doing the right things? Am I on the right track? And ideally second, am I financially independent? Can I go work optional? What does that

Katy Song (00:29:19):

Look like? Yeah. And I have to say that when it comes to work optionality I have, because of where we are in the Bay Area and because of equity events, honestly it’s really inheritance or equity events that enables work optionality at an early age. I even have a couple of fire clients that are just like, we don’t spend any money. We live in a trailer and we rent out the trailer when we’re not there and we eat beans and rice. It’s easier to be work optional when you spend no money. But for

Steve Chen (00:29:55):

Don’t have kids, a lot of the power people are like, I don’t have children, whatever that,

Katy Song (00:30:02):

And so if you’re a family, that whole, I’d like to retire as soon as possible,

(00:30:08):

And they’re like 45 and they have 600 grand combined, say for retirement, that’s not happening. But the one nice thing about doing a financial plan, not the one nice thing, but one of the nice things is that you get your number, which is like, okay, how much do I have to be saving every year to make 65 happen? What about making 60 happen? And so we have to get those kind of magic numbers. So we’re like, okay, is this even financially feasible? So we talked about the balance sheet, constructing your balance sheet, are you on track? The next step is really your cashflow. It’s like any company, you need your financial statements. So I use Monarch money with my clients. It’s just an app that’s out there that you create an account, you link your bank and your credit cards, but there’s this reports function. You click on reports and spending, it shows you a pie chart. It’s like, okay, for the month of September you spent X. Well, we need to know what your X is. So the average family, believe it or not, spends around 15 grand a month

Steve Chen (00:31:06):

In the Bay Area.

Katy Song (00:31:07):

Yeah, 15 to 20 depends if you need C child,

Steve Chen (00:31:09):

By the way, wheel out this stat. Because when we first met a couple of years ago, you told me it was like 13 grand, and I was like, is it 13? Holy smokes, that’s so much money. It’s pretty. But

Katy Song (00:31:20):

Did you do yours

Steve Chen (00:31:22):

Number? I know roughly what our numbers are. Yeah, and it’s not that mean. Definitely. I mean, we live in the same town, right? It’s like even if you’re efficient, if you own a house and you have a mortgage, you have kids and you’re living and whatever, it’s easy to get paid for.

Katy Song (00:31:38):

Yeah, I mean, so the big three discretionary categories are food, shopping and travel. Health and personal care has now emerged as my fourth discretionary category that I’m trying to pay attention to with my clients. During COVID, people were swapping gym memberships for mental health, for therapy, and now it’s kind of switching back. People are like, oh, well now we’re both joining the gym and we belong to this club. And I have a client in North Carolina and they spent a lot of money on food.

Steve Chen (00:32:09):

And

Katy Song (00:32:09):

Then I was looking spending, I’m like, okay, so your club dues are like 1200 bucks a month. Is that normal? And they’re like, oh, we eat there too. And I’m like, okay, wait. Now we’re spending like $5,500 a month on food. And so for anybody that’s listening, that is not normal. That is a lot of money.

Steve Chen (00:32:26):

Is that eating out or is that everything all

Katy Song (00:32:29):

In? That’s everything. That’s everything. A family of four who buys organic and goes to nice stores but doesn’t go crazy, 3,200 or less on food is average.

Steve Chen (00:32:41):

It’s still insane. I think people listening to this would be like, that’s crazy.

Katy Song (00:32:45):

Yeah. Well, an individual should be spending like 1200, a couple less than 2,400. And then when you add some kids to the mix,

Steve Chen (00:32:52):

It’s a hundred dollars a day to feed your family organic food essentially.

Katy Song (00:32:58):

And that’s gone up obviously over time. I mean honestly,

Steve Chen (00:33:00):

Yeah, if you shop at Whole Foods and whatever, we need to get Trader Joe’s moving into Mill Valley here.

Katy Song (00:33:05):

Oh, that’d be great.

Steve Chen (00:33:07):

Whole Foods shut down. I know. Single hand. They bring down the cost. A thousand dollars a month

Katy Song (00:33:15):

Very much would.

Steve Chen (00:33:16):

Okay. Very much. Well, it’s actually super interesting. So you can get these kinds of insights and be like, how do you benchmark in terms of other families and what’s possible

Katy Song (00:33:24):

Social benchmarking? Big. It’s big because also the same client in North Carolina when we were looking at, when I see a red flag, so either eating out, so people who are listening to this, some practical things. Ideally it’s a 50 50 split between groceries and eating out. If it’s more like 30% groceries and 70% eating out, then either you hate cooking or you’re slipping into convenience mode,

Katy Song (00:33:53):

Which Is like we’re just too tired at the end of the day. We’re not doing any kind of forward thinking when it comes to meal prep and that kind of planning and stuff like that, which is hard. It’s really hard, especially if you’ve got two people working full time. So that is the ideal split. When it comes to the other red flag is shopping, like discretionary spending, and I’m talking about clothing, electronics, books, stuff, Amazon, target, that kind of stuff. If you are having multiple packages arrive on your porch every day from Amazon, there’s a problem.

Steve Chen (00:34:27):

Yeah

Katy Song (00:34:27):

So my red flag goes off when Amazon shopping is seven 50 or higher. And it seems like, I mean, seven 50 sounds like a big number, but I’m telling you, I’ve got clients that come to me and it’s like $1,300 to $1,500 a month just at Amazon. And that’s not the only place that they’re shopping. And monarch’s kind of cool because it has an extension and then it will further categorize is this because everybody will be like, but I buy everything. I get my toilet paper, I get my shampoo, I get my vitamins. And you’re like, okay, what are these? You have 279 transactions in a year long period. That’s essentially almost every day you’re ordering something from Amazon.

Steve Chen (00:35:07):

It’s crazy how Amazon has made it so convenient that brings stuff to your house. Okay, so housing, food, discretionary. What was the other big bucket?

Katy Song (00:35:17):

Travel.

Steve Chen (00:35:18):

Travel

Katy Song (00:35:19):

Travel’s a big one. I do every once in a while have a client that doesn’t travel or they do camping or something like that, but that is the rarity. So the average family of four spends 25K to $40,000 a year in travel.

Steve Chen (00:35:35):

Okay, that’s two grand a month. Two to three grand a month

Katy Song (00:35:39):

Which is not insignificant. And a lot of times that may have to be funded from bonus income. I mean because so many people were like, okay, well now my kids are older, I want to take them to Europe. Or the other one is the exhausted, I need a vacation. And so you end up paying this big premium to go to Hawaii during the break when everybody else does. I mean we live in Mill Valley, which is special, but there’s Mill Valley West, which is Maui. We’ve got Mill Valley North, which is Tahoe, and we’ve got Mill Valley South, which is somewhere in Mexico. And you see how much, I mean every trip ends up costing around $10,000. If you do three of them a year, that’s 30,000.

Steve Chen (00:36:22):

Who has time to take three trips a year? I want their, just kidding.

Katy Song (00:36:26):

My goal with my clients is like, you should take as much travel as you want.

Steve Chen (00:36:32):

Totally. Okay.

Katy Song (00:36:33):

If that’s a goal.

Steve Chen (00:36:35):

Well, I think it’s super interesting just for people to compare themselves and see what, it’d be super cool to look at this by town. I’m sure it’s by zip. I’m sure you can put it into these zips of like, hey, if you’re in a high cost living area and you’re a high income earner, it’s probably not that dissimilar to what we’ve just described. And then I’m sure there’s different segments in terms of the cities and earning power and stuff like that. Yeah.

Katy Song (00:37:03):

Well, and the big thing is too, is your age of children. There’s this like cashflow hemorrhaging when your kids are under the age of five, that’s what I call them, the cash hemorrhaging years. So usually during those years I’m like, it is okay if you can’t save a penny, but we still need you to be maximizing your 401k and making sure that the investments are really aggressive and that if grandparents want to give money for 5, 2, 9 plans, yay. Just say thank you. But maybe you don’t need to be saving for that goal once your kids are in elementary school there then is this, I mean, you have kids, how much activities cost? So many people are like, well, I mean I want my kid to do everything that they want to do. But that can spiral out of control. Camps are expensive, but if you’re working full time and you got two parents, it’s just a necessity. So activities and camps, what I’ve seen is it’s usually four to once your kids are in public elementary school, four to six grand per kid for activities and stuff like that. Once kids are in middle school though, I mean stuff becomes free. Again, you’re not spending, unless you’re doing traveling soccer or baseball or something crazy that

Steve Chen (00:38:12):

That’s the whole industry. I was going to say that should be your other line of costs if you

Katy Song (00:38:15):

Well, aren’t there? I think the private isn’t private equity buying all that stuff up.

Steve Chen (00:38:20):

You’re beat me to it. This is exactly has happened because it’s such a money machine, kids, parents spending whatever it takes for their kid to play travel lacrosse or travel baseball.

Katy Song (00:38:31):

Oh, volleyball. Yeah, no, 12 grand. 12 grand.

Steve Chen (00:38:35):

I want to come back and I want to run basketball tournaments where I charge admission and every team pays 500 to a thousand bucks to be part of it. And you can hold, I’ve met people are holding one basketball tournament and you’re making 50,000 to 100 grand. It’s crazy. Everything is, it’s insane.

Katy Song (00:38:54):

Yeah, no, I think that youth sports is become insane,

Steve Chen (00:39:00):

But

Katy Song (00:39:01):

That’s why private equity is buying them all up,

Steve Chen (00:39:03):

Man. Alright, well look, this is actually fascinating for me to kind get your perspective on the inner workings. It feels like this should be a show that the real whatever lives of these families and what’s happening and how much they actually spend on stuff.

Katy Song (00:39:21):

I know every once in a while I’ll do a case study and be like, okay, well this is how this person usually, it’s like, this is how they achieve financial independence early. But I mean, some of them, I’ve got clients in San Francisco who are paying private school tuition for three kids also need to have a nanny because they don’t get out of work in time. Maybe they’re both attorneys or whatever it is. And they’re spending $120,000 easily on their kids every single year. And the cost of private school for K through 12 is a half a million dollars.

Steve Chen (00:39:54):

I know. It’s crazy.

Katy Song (00:39:55):

So you really do have to be earning 500,000 plus to even afford that.

Steve Chen (00:40:01):

I think these are the big framing up those huge trade-offs and really being thoughtful about it is usually important. So yeah, I was just back to the, I want to talk more about what’s happening in the industry in a sec, but I’m actually super curious. Just the pragmatic reality is, okay, so say that the numbers we use, you’re 50, you’re making this kind of income, you should have 1.75 million, but if you’re wealthy, you have three point a half million, even three and a half million at a four to 5% safe withdrawal rate. If you wanted to live on it, it’d be one 40 to 1 75 per year. And we’ve just talked about how now if you were just trying to do that and you didn’t have to save, well, I guess your taxes would be lower. You’re not saving for retirement anymore.

Katy Song (00:40:51):

So taxes are big. Taxes are big. So most people who are dual income earning both of them earning a living, paying social security, paying Medicare, paying disability, all that kind of stuff that you have to pay. Your tax rate is usually, unless you live in Texas or Washington, don’t have income taxed, your tax rate is usually maybe low on the 28 to 37%. And then I’ve done so much income tax planning for people who are now retired and not earning income. Even in California, your effective tax rate, meaning every dollar is charged, that is between 14 and 18%. So a huge difference.

Steve Chen (00:41:35):

So it feels like, okay, I’ve been living in this HighCo living area and I spend 13 to 15 grand, or maybe I’m spending 15 grand, but now my kids are out of school, I’ve saved three and a half million dollars. I’m going to assume a 5% saved withdrawal rate. You’re there, you’re 15 grand. Well, you got to pay taxes and stuff, but it’s not that far off. I mean, I think the other big variable is social security. You can’t get it at 50, but if you have two high income earners, your social security could be not nothing, right? I mean it could be four.

Katy Song (00:42:09):

Yeah, it could be four grand a piece,

Steve Chen (00:42:11):

A piece that’s 8,000 a month that adds up, right?

Katy Song (00:42:16):

Yeah. So it’s that in-between period. So getting back to the beginning of the conversation, talking about the guys that work in tech that got laid off and now can’t find jobs. That’s why I work with my clients earlier on to be like, we need to diversify your assets. So it’s great to have maximize your 401k. Of course, we want to get any kind of matching if we can do, most of my clients can’t do direct contributions to Roth IDAs, but every once in a while they can. So if they have the cashflow to do that, we like to do that. But even then you can’t really take it out to your 59 and a half. So we also want to have some kind of brokerage account. So even with my super young clients that are in their twenties, we are setting up a Schwab brokerage account and setting up automatic investing. And sometimes it’s a hundred bucks a month.

Steve Chen (00:43:00):

Yeah, right

Katy Song (00:43:00):

Like, okay, we’re going to put $70 a month into the s and p or a broad index broad US market index, 30% into an international broad international total stock market index. And then every time they get a raise, we bump it up or then we make it every two weeks instead of every month so that they have some diversification in their assets that they can pull from. Because the happiest retirees, not only do they tend to be renters, but they also have multiple pockets to pull from. So you’ve got taxable brokerage and you’ve got your pre-tax stuff.

Steve Chen (00:43:34):

A lot of our users are really leaning into this tax arbitrage. They’re doing Roth conversions and stuff like that’s even into the huge plays, but you need to have that tax diversification in many cases. You got to pay the taxes when you’re pulling it out, you’re trying to maximize your marginal tax rates. So some people, they’ll even engineer low income so they can do these conversions and they got to make sure they can pay for taxes, and they’re just trying to get the money reallocated from qualified to Roth. But having some brokerage money is super helpful too.

Katy Song (00:44:08):

Well, are you finding though, that people are doing that as early as their mid forties or people waiting till they’re retired in their late fifties, early sixties to start doing those conversions, finding that they’re not working anymore and doing the conversions?

Steve Chen (00:44:25):

Right. Well, our users buy us 50 plus, or at least they start, that’s where it started. Now it’s getting younger. I think our user base is informed by they’ve been doing the right things for a long time, like your clients, right? For you, it’s like you’ve got to be prudent. You’ve got to invest. You’ve got to make good choices over the course of your life. And then you can end up as a 401k millionaire. You can be a normal person and be a 401k millionaire. I think without getting RSUs and all the rest of it, that’s a lot of our users, and I think they’ve been doing this and they’re like, okay, what are the other, the first question they always want to know is, am I going to be okay? Right. Will I be okay? Am I on track? And if yes, either way, how do I get on track?

(00:45:09):

But then how do I optimize? How do I make, what are those things I know? What can I do? And then it’s a game they’re trying to play and then they’re to, then it’s hopefully if they take care of themselves, then it’s like, how do I take care of my parents or my children? But I would say what we were talking about from zooming out, the game continues to change because many of us have aging parents. Now is that’s a real thing. That can be a huge cost that people don’t, Hey, if somebody needs memory care, 15 grand a month, think your kids are expensive. Try your parents in memory care, 20 grand a month. It’s like that can happen.

Katy Song (00:45:48):

I usually see 10, I think 20 is high, but

Steve Chen (00:45:53):

Someone in our family had 18. I was like, holy. I was like, what are you doing? And this was in a second tier. It’s not in a high cost memory engineer, but it was in a nice facility and Emma was memory care. But

Katy Song (00:46:07):

Yeah.

(00:46:09):

So I do find though that one of the things, getting back to the reframing, reframing reality, which is everybody’s looking for certainty and nothing is certain. The only certainty is that there’s going to be change. So if you work with a great software or a great financial planner and you have a good plan in place that accommodates for change, that’s where you want to be. So you have your plan for, okay, what are you doing this year? But just like you were saying about Roth conversions, your strategy can change on a year to year basis just because it worked for you for age 50 to 53 doesn’t necessarily mean it’s going to be 53 to 55. So having somebody that you can talk to and bounce ideas off of is the ongoing service that I provide to my clients. So I’ve got 700 clients, I’ve helped 700 people. They’re not all coming back every single minute of every single day. They come back when there’s a life event. My mom’s going to go into assisted care. Should we sell her her house? Should we keep the house? I’m getting a divorce. My kid gotten to this, gotten to NYU and we thought they were going to go to Cal Poly. How do we pay for this? So it’s life event based for my ongoing work with clients, which is what I love. I’ve done the heavy lifting. I’ve done the modeling. I know your financial picture,

(00:47:32):

And it’s really easy to keep it up to date.

Steve Chen (00:47:35):

Well, I think that’s, yeah. So we’re doing, it’s so interesting. I think the way you’re working is the way of, for many people in the future that this gets more accessible. I mean, I’m not against, most advisors charge the 1% model and they’re managing your money, but I feel like a lot of the value is really the majority of the value is in helping people see their situation clearly and anticipating what’s likely to happen. I think this is a much bigger part of it. I think it used to be like, Hey, someone’s managing my money. Oh, it’s invested. Great. Now it’s like, Hey, this is what the next 20 years looks like. Here’s people like you, and guess what young family, exactly what you’re doing this life stage. Okay, zero to 5, 5, 10, 10 to 18 in college, out, whatever, parents, what could happen. And I also think there’s all these things around money. If you’re going to potentially get divorced, that could blow your plant out of the water more than anything else. For sure. People realize, right?

Katy Song (00:48:39):

Yeah. Divorce does not help anybody, but it’s just what the statistics are. It’s like isn’t 50% of marriages and a divorce? I mean, sometimes it’s not avoidable. I don’t think people should stay married just for financial reasons, even though some do, but nobody walks out feeling better.

Steve Chen (00:49:00):

Yeah, a hundred percent

Katy Song (00:49:01):

Financially.

Steve Chen (00:49:02):

Yeah, for sure. Yeah. No, but it’s just these things that are not always in your control. Parents and children and all that stuff, and where they go to school and who needs care and whatever.

Katy Song (00:49:12):

Well, getting back to what you were saying about the industry and asset center management. So 1% is kind of standard. Sometimes they’ll chart, the more you have, the less they charge. It’s like a sliding scale in a way. There tends to be a tipping point, at least with my clients. So I’d be interested to know for your client base or your customer base too, is that there’s this like, Hey, when do I have so much that I should seek professional help? And there are some people that are like, no, I’m a Bogle head. I want to DIY it for the rest of my life. So I’ve got some clients that have $20 million and they meet with me twice a year. We look at their portfolio and that’s how it works. But I do find my clients, when they get to that three to $5 million mark, they’re like, oh, I think that psychologically I might feel better if I’m paying somebody to manage this money for

Steve Chen (00:49:58):

Me.

Katy Song (00:49:58):

Yeah,

Steve Chen (00:50:01):

Have pretty, our user base is much more biased towards DIY on the consumer side, but we work, our platform is used in other places. And I think it’s a couple of things. So one is, yeah, how comfortable is the person’s DIY versus not? And then also, do they think that, hey, mostly those people are like, there’s this term banker in the family. A lot of times there’s a banker in the family, they kind of know what’s going on. It could be a person, you maybe like me that they’re educating their people, but other people are just not at the same level and don’t necessarily want to be at the same level. But the banker’s like, okay, but now it’s three to 5 million bucks, and if I’m not here to babysit this money, who’s going to do it? So I think that is a very real thing. Taking care of your spouse, just thinking about your family more broadly and just being aligned. I do think that people will go there. And so for you, what happens? Do you find pressure to, I should offer this?

Katy Song (00:50:55):

I have thought about offering assets under management for on and off for the last 18 years, but there was this person of my mastermind group, I belong to the Secret Society of Financial Planners, which is awesome.

Steve Chen (00:51:10):

Is that the actual name of it?

Katy Song (00:51:11):

Yeah, the Secret Society. It’s called the Society. It’s amazing. It’s a secret. So I can’t tell you anything more, but one of the women that I was talking to in that group, she’s like, Katy, if you haven’t done it yet, you’re just not going to do it. So just stop. Because every once in a while I’d be like, Hey, should I custody at Schwab? What should I do? Should I do a tamp? These are all industry terms. And I was like, you’re right. I don’t want to do it, so I’m not going to do it. Ever.

Steve Chen (00:51:37):

Ok

Katy Song (00:51:38):

Decided there’s my line. Yeah, right now, never going to do it on this podcast. You’re the first to know Steve.

Steve Chen (00:51:46):

Well, good. And we’ll see. Who knows.

Katy Song (00:51:50):

It’s not going to change,

Steve Chen (00:51:51):

But I want to join the Secret Society of Financial Planners, so I got to learn about all this stuff. I guess.

Katy Song (00:51:55):

It’s pretty cool. We meet in Park City.

Steve Chen (00:51:58):

Oh, park City. Park City.

Katy Song (00:51:59):

Yeah. There’s no surfing there for no foiling there.

Steve Chen (00:52:02):

Park City sounds good though. Okay. Yeah. Well, I guess I appreciate all the stuff we’ve covered. I mean, hopefully I think people will find this pretty interesting. Hopefully people are good with it in terms of sometimes I feel like we live in this crazy world that

Katy Song (00:52:17):

People can’t relate to

Steve Chen (00:52:19):

And even describing it sounds like, I mean, I grew up in upstate New York in a very middle class world, and even these numbers are kind of hard to say for what it’s worth, I think. Anyway. But I’m interested about your view on how this world’s going to evolve. It feels like you’re doing really good stuff. I mean, I feel like we’re doing good stuff. It feels like many more people need access to financial planning, literacy planning, good support. How does that happen? How do we help a lot of people?

Katy Song (00:52:48):

Yeah. So there’s this network called the XY Network, XYPN. So I went to a conference in Austin a few weeks ago, and I was surprised to meet as many advice only planners as there were out there, which was phenomenal. So there are more people that do what I do. I call myself a unicorn. So maybe I’m not quite the unicorn anymore, but I have been doing this for 18 years, so maybe I was of the first unicorns out there. So you just have to find a person. You have to find the right fit. And so there are a lot of people who come to me where the DIY and finding the program, it’s too much. It’s such a hercule effort for them. So there is help out there. You just have to really know. You can call yourself a fee only planner and still be a UM and still do assets under management. So just be really clear on what you’re looking for to get financial advice. And there’s never, I mean, the best time to start is when you’re ready to make change. So I have some people that are like, oh, I passed along my information to so-and-so have they called you yet? And it’s like seven years later and they finally call me and that’s fine. It’s like when they were ready to engage in it. So if you can make the call, that means you’re ready for change.

(00:54:02):

Stress causes pain and pain causes change. So as much as we don’t want to have stress in life, sometimes it’s the instigator to actually put you on a pathway to making your life better. But I think that that’s the deeper thought, which is, do you want to live your best life? And is stress and concern about money standing in your way? Then do something about it. Right? If you had a thorn in your foot, you would sit down, you take off your shoe and you get the thorn out. So just 20, 25 is almost over, right? 2026 is upon, it’s like, just do it now.

Steve Chen (00:54:39):

Hundred percent.

Katy Song (00:54:40):

Yeah. Just do one thing to improve your life today.

Steve Chen (00:54:44):

And coaching, it feels like so much of this is behavior change. It’s like people need an accountability coach. A lot of people, I think, know what to do, but they don’t do it. And so they need someone to help them do it.

Katy Song (00:54:56):

Well, I also ask some questions, some qualifying questions, which is like I show people a bank of words or I give them a welcome package. And in this bank of words, I want them just to check off three things that resonate with you. And it could change over time, but there’s a very different person. If you check off, I want adventure, wellbeing and experience that is very different than the person that checks off. I want balance and security,

(00:55:21):

Totally different people. I’m going to make different recommendations. So while the numbers will tell me a story, tell me the math of it, who you are as a person really needs to drive the recommendations. So if you want that adventure and experience, maybe home ownership isn’t the thing for you. But if you’re striving for security and balance and you don’t want to be evicted from your rental property that you’re renting, then maybe home ownership is the thing for you. And so much of the time, everybody comes with their baggage, their money stories. I grew up with a father who is a bond broker. I was never worried about money, and maybe that enabled me to think of money with abundance.

(00:56:00):

My mom was a self-directed asset manager. She just traded her own portfolio. So I grew up with this stuff. So many of my clients are first generation professionals. Their parents do not have the financial acumen. They didn’t have 401k plans. They didn’t have brokerage accounts. They may have not taken big vacations or it was a feast or famine. Like, oh, one year we had a lot of money. The next year we didn’t. So part of the that I do with my clients is like, okay, I don’t get super deep into the psychology of where you were previously and the stuff that you’ve come in with, but it really is about looking forward. The past poor decisions have already been made. We’re really looking towards the future. Who do you want to be as a grownup? Do you want to be just like your mom and dad stress about money and not having a penny save for retirement? Or do you want to do something different?

Steve Chen (00:56:49):

And

Katy Song (00:56:49):

That’s usually the motivating factor for people to be like, okay, let’s just do this

Steve Chen (00:56:52):

Whole idea of first generation money is super interesting idea. It totally resonates with me. It’s like it’s first generation people or come to a new culture like America, parents are the actual immigrants. For many of ’em, it’s a struggle. And then the kids can do great. I mean, it’s changing, but same thing with money. It’s like, hey, if you’re new to money, you really don’t know your way around, but your kids might do great if they’re set up and they’re educated. The other thing that’s resonating is just how much of this is coaching for you? Do you think that it feels like, do you think many advisors think the way you do? It’s very much about the person. I believe this too. It’s about the person, the person’s, more than half the math is the simpler part. It’s the human and what they want and need and their goals. That is like what has to be managed or coached upon.

Katy Song (00:57:48):

Exactly. I mean, I think that’s one of the reasons that we have our secret society for financial planning because we call ourselves real financial planners, and everybody there is, like me, they’re all looking to help their clients be the best version of themselves, which has coaching as a component to it. So sometimes we have a perspective and we can be like, okay, listen, we can help you get the resources to work in your favor by optimizing, like you said before. But the other component of it is being really clear about, okay, what do you want? Do you want to spend more time? Do you want to coach basketball? That means getting out of work at three, two days a week and having your weekends free. Does that matter to you? How can we help you make that a reality?

Steve Chen (00:58:35):

Yeah. Awesome.

Katy Song (00:58:36):

So you have to do a little bit of that work of figuring out what’s going to make you happier.

Steve Chen (00:58:41):

Well, Katy, this is great. I think people are going to find this interesting. Good. Thanks for joining us on our Boldin Your Money podcast. We’ll definitely point to Katy song.com and your book. And obviously I think people, this will speak for itself. I’m sure lots of people will be like, oh, this is really interesting and I want to talk to Katy. So hopefully that’s helpful for your business. It sounds like you’re busy. I don’t even know. How do you scale this? What’s next for you? Actually, that’ll be my last question as we’re closing up here.

Katy Song (00:59:11):

Yeah, I mean, so as you know, I partnered with a startup for about a year and a half, and there were some personality conflicts with senior management, but we were trying to scale it. We were trying to hire advisors. I trained a whole team of people to be me, to be many versions of me. So I know it’s possible. I just don’t think that scaling, I just turned 50 this year. I’ve got freshmen in high school and I’ve got a freshman in college. I want to be able to jump on a plane and go down there and visit her like I did three weeks ago and have brunch. That’s the life I want to lead. So when it comes to what you’re doing and having a startup and building a business, it’s just not the path that I’m taking right now. But I think that the need is out there. And I think that definitely with the younger generation, with millennials and even Gen Z, they’re not going to wait until they’re 50 and find somebody to do a UM. They want help now. So one of the things that I’m doing with my business is offering a one page plan, which is really for the 22 to 29-year-old,

(01:00:22):

And it’s literally one page be like, here’s how you do everything you need to do for now.

Steve Chen (01:00:27):

Yeah,

Katy Song (01:00:27):

Awesome. Right, and can you imagine if you had that in your twenties?

Steve Chen (01:00:30):

Yep. So funny. They talk about 22 year olds. I mean, I have kids that, but that’s when it counts. Saving when you’re younger, you have time,

Katy Song (01:00:42):

And also not making realistic decisions. Do you contribute to your 401k? If so, how do you invest it? Having a high yield savings account, not getting into debt, how much do you need to be? I mean, I think that one of the biggest things is people’s human capital and financial planning doesn’t talk about that a whole lot, but that is your biggest asset. And if you take a pay cut or take a lower paying job because you feel like you have to, sometimes you have to, but that can set you back more than sitting on cash in your retirement account. So your earning potential is huge, and doing something that feeds your soul is really important as well. So if any younger listeners are listening to this, focus on your human capital and your value.

Steve Chen (01:01:32):

And this is, it’s a hard trade in Silicon Valley. I’ve spent my life in startup land. Well, I had a regular job and then I did a startup, and we got paid not a lot of money and we had a lot of paper equity, but it didn’t work out. And it’s like, okay, that was a serious opportunity cost. And then I’ve been a small business owner where I’ve printed money, and that was game changing. I think you do need to be thoughtful about actually having real dollars, not just paper wealth. And I think this is one of the things that people say is it can be much better to just go work at Meta or Google or whatever and just print, get a high salary, get RSUs, do that for 10 years. You can be way better off than people. I mean, you may not, if you’re an open ai. Yeah, great. It’s worked out, but not everybody’s in open ai. So that whole thing, that whole equation that really matters. You really got to be thoughtful about it.

Katy Song (01:02:24):

They’re really happy. As of seven days ago, all the OpenAI,

Steve Chen (01:02:28):

Well, I know there was a secondary right, and stuff like that.

Katy Song (01:02:30):

Yeah, they had a big tender. I have a lot of open AI clients.

Steve Chen (01:02:35):

Really. Alright, good.

Katy Song (01:02:36):

No, I mean, wait, really quickly though, getting back to what you’re saying about being an entrepreneur, that is a way, even if it’s a side hustle, I have a lot of clients who have not been super happy on their day jobs and they find either through coaching or marketing or whatever they’re going to do on the side, they find something that they’re really good at and something that they really like and they’re able to monetize it, and then eventually they get rid of the day job.

Steve Chen (01:03:01):

Right. Well, I think that’s something I definitely, we believe in. It’s like we think that that’s the power of getting financially confident or seeing this path. You’ve done it, right? You’ve made this pivot of I was an investment banker. Oh, this CFP stuff seems fascinating. I really love it. Obviously you love it and have been wildly successful at it and built a life that you have a huge amount of control and probably do. I’m sure you do. I know you do very well. But yeah, finding that path, I think that if all of us were financially confident, we could be like, okay, maybe there’s something else besides that, what I’m doing that I would really love with my human capital, my biggest asset, and I love it, makes a lot of money or makes enough money that I can achieve my other goals.

Katy Song (01:03:42):

Yeah, that’s the dream equation.

Steve Chen (01:03:44):

We’ll see. Okay, well look, Katy, we could keep going. Maybe we’ll help to another podcast, but I appreciate you jumping on. Great to see you, Steve. Yeah, it’s good to see you as well and we’ll know. And for everyone listening, thanks for listening and check out KatySong.com. All reviews are welcome and hopefully this has been useful. So thank you.

Katy Song (01:04:04):

Thanks.

The post Podcast 104: Money Confidence for Real Life with Katy Song appeared first on Boldin.

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