City of Plantation Podcast

Episode 31 - Financial Planning in a Gig Economy

March 19, 2021 City of Plantation Episode 31
City of Plantation Podcast
Episode 31 - Financial Planning in a Gig Economy
Show Notes Transcript

Thank you for listening to the City of Plantation's Podcast. In this episode, Cary and I speak with Doris Baker from Consolidated Credit, Doris is a Financial Education Specialist with Consolidated Credit, she has extensive experience in the baking and financial services industry, as a personal banker and loan originator.  In this episode, Doris speaks to us about financial planning in a Gig economy and other financial factors for all of us to consider. This Podcast is aimed at keeping the residents of Plantation informed of events and important information happening throughout our city. Please subscribe to this podcast, as we will be producing new episodes regularly.


Hosts: Cary Blanchard and Ezra Lubow
Guest: Doris Baker
Music: Oakwood Station
Graphics: City of Plantation

Speaker 1:

Welcome to the city of plantations podcast. I am Carrie Blanchard, battalion chief of public affairs for the plantation fire department. Thank you for tuning in our podcast is designed to keep you up-to-date on all the latest happenings and activities in about and around the city of plantation on our episodes, we talked directly with the leaders decision makers and the movers and shakers who make plantation the great city that it is

Speaker 2:

Welcome back to another episode of the city of plantation podcast. Carrie and I are very excited to have with us Doris Baker in his studio today for this episode, Doris is a financial education specialist with consolidated credit. She's had extensive experience in the banking and financial services industry as a personal banker and a loan originator. Her passion is to serve all sectors of the community by providing financial education and empowerment, budgetary insight, and the development of positive economic life skills. So thank you very much for joining us today.

Speaker 3:

You are so welcome and thank you for having me today. Absolutely.

Speaker 1:

Thanks Doris. We appreciate you being here. Um, I guess today, I think you wanted to talk about making the most of the gig economy and like how to set up a second income stream without cramping your lifestyle. And I know that there's a lot of people that are worried about economics, finances, whatever. What , what can you tell us?

Speaker 3:

Well, first thing I want to tell you is that , um, right now we have 57 million American adults that are part of what we call the gig economy. And this is outside of your full-time employment. If anything, 2020 taught us with downsizing business, closing hours being cut back is that we need an additional stream of income. And this is where the gig economy comes in. Now, one thing we can start with as far as the gig economy is concerned is to look inside yourself. What are your passions? What is it that you like to do? That would be the easiest way for you to introduce yourself into the gig economy, but maybe you might say, Oh , I don't know. I might not have the self-confidence to do that. Another thing you can do is go to a retail store, go to a restaurant somewhere where you're going to have a choice of hours where you're going to work, namely the hours that the managers have a hard time feeling, which is what evening and weekend hours. This gives you a toe in until the gig economy to see how, how you float, how you like it. Right? Right. Also think about if you have any skills that can be used virtually, we're talking about writing, we're talking about coding. We're talking about any type of design that you can do via the computer. There are websites that you can use that you can go and see if your skillset fits anything. One website is called upwork.com. Another is freelance.com. And lastly, there's something called people per hour.com. But I want to warn you about these websites. It is very competitive. You have millions of people that are vying for these positions that are there. So you have to be a one on your game. You have to come in knowing that your skill set is going to produce an employee that these companies, or sometimes even other entrepreneurs may want to hire.

Speaker 2:

Let me ask you a quick question on that. Would that would that, would that provide opportunities for an independent contractor type of person to maybe make connections and network with possible longer term contracts or employment opportunities?

Speaker 3:

Definitely. So , um, to take just a step back, a lot of independent contractors that had contracts, if I can use that word with businesses because of the COVID-19 pandemic, some of those businesses had to close, therefore those independent contractors or freelancers lost opportunities. So here's another endeavor. You can just put your resume out, like you would for any nine to five. And these websites that I just mentioned and possibly you'll get a hit. Excellent.

Speaker 1:

So this gig economies , what we're talking about is this like a second job or a job in place of what , a job that you may have lost .

Speaker 3:

It can be a second job mainly. That's what we look at it as a second job, something to enhance your full-time job , um, something to bring in additional income because maybe your hours were cut. Um, a lot of things are opening back up, but a lot of things are not having, or a lot of businesses aren't having as many as employ as many employees as they have, or not with as many hours. So here's something to supplement say your main income.

Speaker 1:

So like, what you're talking about is you finding a passion or something that you , you have the skillset for, because if you have to do this, even as a second job, it's obviously easier to do if you're passionate about, or if you enjoy it,

Speaker 3:

If you love it, I love what I do at consolidated. So it's easier for me to get up in the morning and go to work. Now, if I get a second opportunity, I must love, love that I have to really be passionate about it because here goes my free time. But I have to think about it positively that I'm making money. Okay. And then I'm making money to hopefully get out of debt, put something towards savings, but I'm getting ahead of myself with that. Also, I wanted to , um, say that you can use your social media platforms that I want to use. For an example, I have a friend that is a terrific Baker. She has a very good career and Miami Dade County and County government, let me add. And she's a very good Baker. Well, with COVID to relieve the stress and everything, she started baking from her house. And let me tell you every weekend, she makes hundreds of dollars, hundreds of dollars in guest switch . She's de-stressing, she's doing something she loves when you taste her baked goods, you know that she loves what she's doing, because that love is all stirred up in there. Honey, let me tell you. And so that is the thing about the gig economy. Like I said, in those start, if 2020 taught us nothing else is that we could use most of us, our second stream of income. And if we're going to do that, why not love it, right?

Speaker 1:

Yes. I know that there's people like , uh, they're recruiting and things like that, but there's a lot of scams and a lot of, you know, bad things that happen. You hear about it all the time, send them money. We can get you a job, but what's up with that.

Speaker 3:

Um, what's up with that. It's it's a whole lot, but it is one of the biggest scams out there is if you're going to hire me, why do I have to send you money upfront? My advice is with anything that we're going to potentially do business with less start be it from a Gardner that I don't know from a roofing company to someone that is looking to hire me for a side gig, the better business Bureau let's go there. Let's see how other people feel about it. We'll do that when we're buying a car or we're buying furniture. Let me see the reviews. I want to hear what other people, other consumers, okay. Other jobs seekers have to say about this particular company. There's also websites such as , um, consumer finance.com. Let's see, let's see what everybody has to say about it. And there's something called. Trustpilot go on there. They're going to research you real , not real . If they're a scam, they just want to get your money. So you researched them. You do your due diligence.

Speaker 1:

But I think that in the troublesome part is that some people are desperate. You know, they, they need money. They need to feed their families. So they see what appears to be an easy way out. And it's hard for them to even know whether it's a scammer. It's real. And you're saying to do a little bit of research, but sometimes people get desperate and make I'm going to use the word poor decisions out of desperation. So is there any way to be able to tell by looking at it, if it's real or not

Speaker 3:

Just the points that I gave you, if they're asking for money upfront, if they're telling you using verbiage, such as, if you don't jump in on this opportunity quickly, it's going to pass you by. If they're always saying we have someone that's waiting on your spot, act quickly. If they're harassing you, if they're calling you all times of day to say, did you read over it ? Because it doesn't hurt them to send you a fake proposal, fake information, because if I can get a hundred dollars from 10 people in one day, yeah ,

Speaker 2:

Yeah . Right . You've made some money. That's my side. Good . So , so ultimately your advice to our listeners would be, you know, we understand that some of you might be hurting. We understand. I mean, we've, we've talked about this subject throughout multiple episodes of our podcast, but your best advice is take a step back, do a little bit of research. If it's too good to be true, it probably is. Right.

Speaker 3:

Definitely. You took the words from my mouth. If it sounds too good to be true, it usually is. If they're asking you for $50 and with the potential of making a thousand, that's a pretty good return. Especially if you're in a position, like you said, Carrie , where you need to feed your family when you need to make that rent payment or that car payment, we understand. But guess what? The bad guys are out there. They're like buzzards on the fence. They're waiting for people that are desperate. They feed off us being desperate. So you have to take a moment. You have to take a chill mode and you have to do the research, or you're going to find yourself in a worst financial predicament, right? So you have to take that opportunity.

Speaker 2:

Makes sense. Going through that, what are some tips and tricks that the majority of us can utilize to balance our budget and balance our lifestyles?

Speaker 3:

Okay. First thing, that's a curse word for most of us budget because no one likes to think about , um, having restrictions and really a budget is not restrictions. A budget is simply knowing where your money is going. And I like to tell my husband, our budget is giving money and assignment and not money telling us what it's gonna do. Okay . So what's a gig. Um, our , our, our side hustle, as we like to call it w what you to do with that money. If you can afford it, start to pay down credit. Okay? If that's your number one thing, and that's your number one thing with any household budget, there are many budgeting formulas there. Um , many things online that you can use, even things through your bank or credit union , um, online banking platform that you can use for a household, a sustainable household budget. First thing you need to do any income coming in from your side gig is to pay down credit, get your credit paid down. After your credit is paid down. Then you're going to put something towards emergency savings, because we have seen a recent report , um , prior to the pandemic that less than 40% of American households have $1,000 put aside that they can put their hand on for an emergency. So if your car breaks down at that fridge blows, if your oven breaks for less than four, 40%, less than 40% have a thousand dollars,

Speaker 2:

Never guessed that number was that high. I mean, you know, I guess you don't, from our perspective, it's not something we work with every day. So you didn't think about it. But I have a question about that when, when I was younger and starting to learn about finances, that I remember the mantra about credit card specifically. Cause I think most people are going to buy a house and buy a car at the very least those, those items are going to be financed, right? So there'll be a credit liability there . Correct. But the way I was raised in the beginning, and I haven't always adhered to this in my life was when it came to credit cards and store cards and things like that, always plan to pay what you spend at the end of the month is that still sound financial advice

Speaker 3:

That is still and shall always be sound financial advice. Um, we have a presentation that we do. And at one point in the presentation, it says , um, wise credit use you're using credit wisely. And it says, first bullet is to pay what you pay, what you owe something to that effect. And a lot of people go, Oh, I can afford my minimum payment. And so we have to interject. That's not really what that statement means. Ideally, that statement means that if I'm going to charge, when that bill comes in, I'm going to be able to pay that full payment. That is why we advise keeping whatever your credit line amount is. You keep your balance at 30% or less, 10% is ideal because 10% you usually can turn right around and pay it off. And that is helping to your credit. Okay? Because , um, 35% of our credit score is based on timely payments. So if something goes on like a pandemic and you're not able to make that monthly payment, that starts a very fast decline of your credit score. And if we learn anything during the pandemic, we need to keep our credit up because you just never know when you're going to need.

Speaker 2:

And let me ask you a question about credit score too , and I'm sorry if you had planned to discuss this, but , um, so I know that there's also a value in your overall credit score based on , uh, the overall amount of credit that you carry based on or in relationship to your , your maximums, I guess . Yeah . And how does that fit into this equation?

Speaker 3:

Okay. Um, of your credit score. I mentioned that 35% of your score is payment history paying on time versus not paying on time. So we always want to pay on time. 30% of your credit score is utilization. So the higher you get to your limit, okay. Let's take a Macy's card. I love Macy's. Yes, that's my friend. Okay. So your Macy's card, you have a thousand dollar limit. Okay. When you start creeping past that three 33, 300 range, and you start to get closer to your credit limit, it affects your store, a store. It affects your score. I'm thinking about Macy's yes, I am. It affects your score and it affects your score negatively. So it sounds crazy. But credit is offered to individuals who know how to maturely handle credit, because if you pay your payments on time, if you keep your utilization to that 30% or less 10%, like I said, it's ideal. Then that is going to cause your score to rise better than anything else. That 65%, those two numbers that I mentioned that 35 in that 30, those are the markers that are going to cause your credit scores to go up. And it is your credit score goes up, lenders, look at you more favorable. You're offered lower interest rates than a person that does not have a favorable credit score.

Speaker 2:

And I think, and you can correct me if I'm wrong, but I think that , uh, other things that we don't always relate to credit score like car insurance and home insurance, those are predicated on credit scores as well. Right?

Speaker 3:

Definitely. Um, some of your municipal utilities, it may not be a hard hit on your credit, but they're inquiring because they, everybody wants to know they're going to get paid. And , um, with COVID-19 , um, lenders are even a little bit more stringent than they were prior to the pandemic. Um, even though we're still in it to some effect, but yes, it's so very important. So with your, with your side gig, do whatever you need to do in order to get your credit where it needs to be. If you can afford to make that extra payment towards your minimum payment, that you're paying, identify it, send it to your principal, let it, let it pay down your credit. So you can, you can feel the ease of not having that credit burden on top of everything else that's going on. Right . Absolutely.

Speaker 1:

And it has so much to do with life in general, your, your wellbeing or your S because stress, it all affects it. There's a definite correlation, right . And as you've carried credit card debt, and then this month you can't pay it. You're, you're thinking I'm going to pay it off this month. Okay. Not this month, I'll pay the minimum. I'll pay it off next month. Well, it all starts to build in the finance charges start to build. So it has such a negative effect on our health and wellbeing .

Speaker 3:

It does. It really does. It , it , um, John Hancock has done a study on what causes , um, some of their folks policy holders to reach their demise. And when they do , um, interviews with the family or whatever research, they found that in some cases, and in a lot of cases, it's been stress-related to money.

Speaker 2:

Yeah . Yeah. There's been several reports published specifically about relationships in marriage. And one of the biggest stressors, if not the biggest in a marriage is usually finances. Right? So I think that your advice is , is very important for everyone to keep in mind. Yeah .

Speaker 3:

Yes. We all have a money mindset. And when we come together with our partners, we might not have the same mindset. Um , nothing is worse. I mean, there are other things worse than one being a saver and one being a spender. So you have to find some common ground if you want that relationship to be successful. Okay. You , you have to sit down and hash it out and go to counseling. Um, both of you get a side gig to make sure that you're paying towards, if one likes to travel, one is a home body, but we want to try to come together. We can't take it from the household budget if we're barely making it. So we have to have a plan and we, our mindsets have to come together. We can be our , our individual selves, but when it comes to those finances, we got to, we got to come together.

Speaker 2:

Yes, absolutely.

Speaker 1:

Okay. Doris , um , and I think that's it. That's what we , you know, I appreciate you very much for coming out here. Um, again, Doris Baker , uh, educate financial education specialist with consolidated credit. We appreciate your time and thank you.

Speaker 3:

You are so Valerie . Very welcome. Anytime I'm here to come

Speaker 2:

Before we sign off , uh , Doris just real quick. Can you tell our listeners what's the best way to , uh, contact consolidated credit? Is there a website or , um , what's the best way for them to reach out if they want any more information or want to hear more of your teachings and trainings?

Speaker 3:

Okay. Um, you can definitely go to our website, which is www.consolidatedcredit.org. You can email us , um , directly in the financial education area at Finn that's F I N ad [email protected] . Um, any questions you may have if you have any debt questions, because consolidated credit is a credit and housing counseling agency. We've been in business over 30 years or about 30 years, and we've helped over 6 million people through education and counseling to become financially stable. Excellent . Excellent. That's a great service. Yes, yes. And , um, that debt analysis that we'll provide you is my favorite four letter word, which is F R E E free. Everybody loves it. Yes, sir.

Speaker 2:

Well, again, Doris, thank you very much. And uh , we hope you have a very good weekend.

Speaker 3:

Thank you. Thank you all for having me .

Speaker 1:

All right . Thank you everyone for listening, stay safe. You've been listening to the city of plantation podcast. We strive to bring you accurate and timely information. Please continue to tune in to our podcast episodes and also catch up with us on social media, including Twitter, Facebook, and next door. If you have questions, send them to ask [email protected] and we will answer your questions directly. Thank you for taking the time to listen to our podcast and stay safe, everyone.