Top Money Moves for your 40s

Introduction

Welcome back to another episode of Black Girl fly. I'm your girl Tanisha Nicole, and I'm Tashaunda Dixon.

And today we want to continue a series that we have been going on about talking about finances through the decades. And guess what? We are to the 40s people like, Oh, my goodness. And so I was just asking Tashaunda offline, I was like, You should have some advice, because you're glad to be 40. And I was saying she's not there yet. But I've been advised to try and prepare for that time frame in my life. Exactly.

Peak Earning Years and Preparation

What what do you have in mind for 40s 30s?

We talked about like you're really you NASSCOM in your career. And 40s, I think is really about, I think you're gonna hit the peak of your earnings. So So those first few years, your 40s Realize that you are peaking. The reason this is important to me, because I met so many people, I tell you guys, I worked in finance for a really long time. But I met so many people that didn't realize that the end was going to come that they had been on this ride from the 30s into their 40s. They were like, you know, robots will keep going up. We're not in a place, and then they get hit. Because like I told you guys before, there's peak, there's, there's a peak, and it's not, when you leave off for retirement, right? It's that thing that hits you when you least expect it. And that's when you when you get up at eight, and they realize that they can bring in someone a lot younger and pay them a lot less and get maybe not as much as but a portion of the productivity that you had. Wow. And so. So I'm saying so I think the first thing that you need to do in your 40s is understand that you are preparing for your career to in the trajectory that it was on abruptly.

And what does that look like? For some people like is it you getting fired, demoted.

So for most people, it's just not fired, because they layoff and you'll realize when you look around the people in the room who got laid off all the highest earners, and typically, those are the olders workers, right? So I've been there, and they're going to, to lay you off. And the bottom line is that we are an environment where organizations are trying to make a profit, right, and they're, it's the bottom line, and you're costing them, you no longer help with the bottom line.

And I have seen this over and over again. And every time I set the person, they were caught off guard, a lot of times by that time, they had a lot of debt still.

In their 40s Yeah, you have, you might have a family, you might have a while your kids are going off to college, you know, and you're like, Oh, I'm gonna make you're still optimistic is my point, you're, you're optimistic and I don't think you should be that optimistic. And so how you prepare for that. One is you start to reduce the required I wouldn't even say your lifestyle, but you start to reduce the required monetary needs. So like drinking your your overall bills, or your your, what we call a but your necessities to a lower dollar point. And I'm saying you can still have at this point, you can still have some things you do that, that are nice to haves, you can have a subscription, you can have the whatever, but be able to shriek fast if necessary. And by this time, guys, I hope that you are putting a substantial amount in retirement still, you know that was talking about about really building that in your 30s. And moving that on to your 40s you're still doing that you're still preparing for that. But but also at that time, I would extend the amount of emergency fund that you have talked about having six to nine months of emergency fund, extend that and I'm saying and I'm the reason I'm saying extended is because also, when you get into your 40s and 50s, it is a lot harder for you to find a job, because you are aiming for more senior level positions. And senior level positions are harder to feel they lower level positions. And so it takes longer for you to fill those positions. So the first thing is, is be prepared. Don't be shocked mentally. The second thing is is shrink your your required font that it takes you to live on a monthly basis. Right. And then the third thing would be be prepared for an extended emergency. Yeah. And so not just refighting the job but also health guys. As we get older your bones start to creek right exactly work like you used to write. And there is a higher likelihood of sickness and things that could follow at that age as well. So I would actually extend your emergency fund out further or longer. Yeah, I would say more like a year to two years, someone right there, that makes sense. One thing that I recently did, I'm in my 30s. But if you haven't done this in your 30s, I think by 40, you definitely need to have have done it based on what you're talking about with health is get disability insurance. And I wouldn't recommend disability insurance for everyone. So I will say you can get disability insurance, or you can get a term life policy that you could access, like a living benefit. And there are some Whole Life policies where you can access a living benefit. But these policies are designed so that if you get injured or something you can this is disability, specifically, there are specific injuries that you could get, that will take you away from work, that basically will supplement your income for a period of time. And for me, this was super important because I'm an entrepreneur, and like, this is my only source of income. And you know, right now I'm busy, it happens to you, you Yeah, like there's no going back to work or anything like that. So I would need to find a job after I got healthy, which would, you know, make my timeline a lot longer than a normal person who has a job. So that's why I got that might not be for everyone. But the other insurance that I got was a living was term insurance that can be convertible to whole life insurance later on down the line, you have to make the conversion within like 20 years, but you go term, mostly because it's cheaper. But this specific policy that I have, based on kind of specific life, illnesses that may come up like cancer, or, you know, you lose some functions, you could tap into that benefit while you're living, right. And so, like Tashaunda, saying, if you're out for a health, you know, health issue, you might be able to, you know, in addition to having a larger emergency fund actually have some supplemental income for a time period.

This came up now, actually, because I was having a conversation with someone who actually wanted some health things now. And they were like, if I could tell you anything. And she had a product actually, that everyone that she knows, in that 40 year range ghosts this. She she was like, it's not a one off. It's not specific people. But everybody that I know, went through, at least got like an emergency period.

Wow, it, we were talking about it more. And she was like, it wasn't just about the sickness that can happen. But mental breakdowns like you've been liking it, you've been working for a long time, you've been hard working. I mean, at this time, do you probably have kids, if you had kids, doing kids you're doing relationship, you're doing work that you are going going going going going? At some point you have to acknowledge that you may not be able to sustain at the levels that you were sustaining before, right? And so that there is going to be a break. Right? Right, right. And just the pain so that that break, doesn't put extra strain in you from the financial aspect of that, right. And that, and I would say, this happened a little bit earlier for us. But I think also around your 40s is the time where you're the health of your family members, like your parents might be declining. So you might have that added burden to kind of consider you know, how you'll take care of that it can have a financial impact on you, for sure. But it can also be taking away from your emotional toll and your ability to work in, you know, with all of that. And I will say again, the policy that I have, it actually allows for you to access the money based on if a family member is sick as well. And you have to you know, take care of them. So Alvin, like, you know, not to bank on insurance, but I think that people should actually do a lot more exploration and talk to some insurance professionals because we can avoid some of these things. But I think insurance is not the main thing.

I think for me there there's a concept that's going on here though, and it's that at this time of your life, things will happen

right? Life is going to happen and that you don't want your financial world to be an extra burden exaggerating things like like getting laid off is a huge trauma. Yeah, right like giving having a sick parent is a huge trauma having you know, things taken away from you because you can't afford a huge trauma. And so so there are things that we can prepare guys this this isn't this is an unknown Yes, it's an emergency Did you know what's gonna happen but you knew at some point it was going to happen right you know, and emergency was gonna happen at some point in the future just not precisely when Yeah. But yeah, so these are things that you can really, you know, quote unquote plan for Prepare yourselves as best as you can for them because you know that they're coming somewhere down the line. Anything else you were at about? 40s? I'm trying to think.

I really like to help thing that you that you talked on. So in your for your parents are usually 60 and above? Yeah, that's a critical time as well.

Shift how you Make Money

Yeah. And as you were talking, I was trying to think like, well, how can we avoid? That's the angle I was coming from. So insurance, yes, but I think it requires some additional things in your 30s that we might not have touched on. But we did talk. But I do want to recap, it's been a while since the 30s, though, yeah, we did talk about starting to shift how you make money. Yes. And in your 40s, you should continue that shift with understanding at some point, you will not be capable of making the money in the same way.

So your your earned income? Um, yes.

So we talked about before, like, like thing, finding more passive ways. And when I say passive, we talk about the definition of passive that I'm passing earlier investment, continue to, to provide residuals on it. And so continue to make that shift. And by the way that would come in handy. So for instance, if your finances right now with your employer give you three, three grand a month, right? All right, but you started to make that shift, I'll be talking about 30. Because you follow directions really well, exactly, you are a student, you will be getting $500 a month, from one real property that you bought 10 years ago. And not only that, but you could also have purchased it 10 years ago, and it was worth X amount of dollars worth of remember, we talked about appreciation. So you also have some some equity, some value sitting there or the ability to tap into that equity value. And so what what's happening now, by the way, is that because you acknowledge in your 30s, that the way that I need to make money will shift and you started to invest in those different areas, while you were in your high power 30s. Making the money and growing in your career, that you're laid off, and you lose that 3000, you still have 500 in your kids, by the way, we talked about not maxing out your expenses. So your expenses at this point, maybe 2000. And so now, you have 500 of your $2,000 expenses. So you need to only figure out how to get 1500 instead of replacing that 3000 You're trying to replace before, right? All right. So that's just an example of one of the things thanks for bringing it up. You need to continue something that you started in your 30s with diversified your revenue sources into your 40s. And to make sure, by the way, I hope that you'd be at house for your 40s if you actually started in 30.

Careers Geared Towards Older People

Okay, goals, I hear you I hear you is that is that a goal? For example? No, it is something that also came to mind. Yeah, lots of ideas here. But I know a lot of people who actually did career changes, like in their late 30s, early 40s, to actually to careers that were geared towards older people. And so there are some careers right becoming president, that you can do well into your 70s When I was a little younger, I don't know that I was sleepy Joe goes to jail. I mean, that's just all jokes aside, like there are actually some careers like attorneys that you can do this, literally, at Walmart. No, no, I mean, if that's what if that's your life, that's your

life? That's easy. Yeah. Like, they probably really enjoy it. Like, like, I would be cool with that. But you're not the thank you just smile.

I mean, I think it's a great opportunity, that if that's what you want, you know, I don't want to have to be anywhere. So I need something I can do remotely. In that example, though, what I'm saying now is that there are things you could do, if you don't know, if you reduce your your experiences, if you created additional revenue sources, right? Like you could you could be like a greeter at five hours a day. Exactly. Because you've set yourself up to do something like that. Yeah. And I would say a lot of I see a lot of folks in my industry like leaving the classroom and becoming consultants are like starting their own consultancy. And that you know, just provides a lot of right or tutoring just provides you a lot more flexibility but it also it benefits you to be older in those situations because people kind of look to your expertise, right a little differently. So there are definitely things on being a professor lots of things you can pursue in your later years 40 and beyond, but you really do have to plan like it gets back to that expect the shifts in Don't just expect things to stay the same time they're changing. So you need to change to definitely. Yeah, that was a word. That was a word. So folks until next time, I'm your girl Tanisha Nicole, and I'm Shana and we are black girl black