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From 100,000 in debt to owning a home in New York City

…and all before 35!

When you’re a first-gen immigrant (or even second!), there’s a ton of internal and external pressure to succeed.  Melissa Jean-Baptiste knew her family had high expectations, and she wasn’t going to let them down –– but she learned some tough lessons along the way, including the very real crush of six-figure student debt.

In an effort to change her future, Melissa learned everything she could about paying off debt, investing, building wealth, and making more money through side hustles and passive income. Lessons she’s distilled into her new book, So This is Why I’m Broke.

Melissa and Tori sat down to talk about the unique experiences of first-gen Americans, from the systemic barriers that prevent access to wealth and education to common financial misconceptions.

You’ll learn:

• How Melissa’s “just start” mentality helped her become more financially confident

• Why Melissa recommends some form (or multiple forms) of passive income for everyone

• Her perfect metaphor for why everyone needs some sort of prenup (yes, even if you’re totally in love)

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Transcript:

Melissa Jean-Baptiste:

You can’t tell me that pleasure and joy and happiness are not tied into finance when finances and money give me the opportunity to gain these things that I want, that make me happy. Especially on Twitter, they’re like, “Money doesn’t buy happiness.” I’m like, listen, grow up. Okay? That quote, let it die. That is ridiculous. That’s not the life we’re living right now. We need the money to give us the joy and happiness we want.

Tori Dunlap:

Hi, Financial Feminist. Welcome back to the show. Every time I try to say it slightly differently, but I’m saying the same word, you’re going to get what you’re going to get. You’re going to get the intro. You’re going to get hello. If you’re new here, welcome to the show. My name’s Tori. I host the show. Obviously I have a New York Times bestselling book that’s also called Financial Feminist, wherever you get your books, including motherfucking Target stores.

That’s the coolest moment ever is walking into Target to get some skincare and some bananas, and then look, look, that’s my face on the shelf. Very cool. Very, very humbling. I help you be better with money and talk about how money affects women differently, and that’s what we do in this show. If you’re an old buddy goodie, welcome back. We’re so excited to see you. Depending on when this episode comes out, it might be still summer. Bask in the glow of summer as we transition into my favorite season, which is autumn.

I love the crunchy leaves. I love the pumpkin flavored beverages. I love the Gilmore Girls on my television. I’m starting to light candles, and oh, it feels very spooky, seance girl. That’s my secret personality is just cabin in the woods. I read a lot of thrillers too. I’m going to go on a quick tangent. My favorite genre to read I’ve discovered in the past couple of years is thrillers. They’re all the same. They’re the same book, which is like girl has husband. Husband does something. Is husband guilty?

I don’t know. Also, she might or might not be crazy. She might or might not have some sort of drinking, drug, anxiety problem. We have to decide if she’s a reliable narrator or not. And then the rest of the book is trying to figure out what happens. This is the same thing or cabin in the woods, 12 people, they start dying off. This is the murder mystery that’s been going on forever. My other favorite trope, which is beautifully done by the Kristen Bell show, what is it, The Woman Across the Street from the Woman in the Window Looking at Me?

I don’t know. It’s the longest on purpose title. That’s basically what I’m saying is that is the… Kristen’s giving me the most like, nope, that was not it. I know the looking for me wasn’t right. It’s like The Woman in the House Across from the Girl from the Window. No, hold on, I’m going to get it. The Woman in the Window Across from the Girl. Oh, I’m going to get it. The Woman in the House Across the Street from the Girl in the Window. I don’t know. It’s basically that show. If you did watch that show, that show was such a moment.

That’s the kind of book that I love and that’s also kind of the book that I love reading in a cabin with a fireplace. Anyway, so that’s September. Welcome to the show. All right, let’s talk about today’s guest. I am so excited to welcome today’s guest. She has been a longtime internet friend of mine, but this was actually our first official meetup. It was so fun to chat with her in general, but also she is just a lovely refreshing take on personal finance that is very similar to mine.

Melissa Jean-Baptiste, financial educator and author of So…This Is Why I’m Broke: Money Lessons on Financial Literacy, Passive Income, and Generational Wealth, is a first generation Haitian American and former NYC high school teacher. As the Beyonce of personal finance, she paid off over $100,000 of student loan debt on a teacher salary while writing and producing the award-winning Millennial In Debt Web Series.

She has since pivoted into personal finance and career coaching to help millennials and gen Z build generational wealth and gain financial freedom in a shame-free digital environment. She can be found at millennialindebt.com and @millennialindebt on all social platforms. Melissa joined us on the show to talk about how as a first generation American she was able to pay off $102,000 of student loans and buy her first home all on that teacher’s salary.

We also get into the systemic barriers that have prevented BIPOC from having equitable access to wealth building strategies and what it truly means to build generational wealth as a marginalized person. She also has one of the best analogies for why you need a prenup that I’ve ever heard. And yes, if you’re getting married and you or your partner has assets or just you don’t want the state to decide for you, we talk more about that, you need a prenup. Without further ado, let’s go ahead and get into it. And now a word from our sponsors. Oh my gosh, the book photo shoot, so cool.

Melissa Jean-Baptiste:

Thank you. I had to fight for that cover.

Tori Dunlap:

Oh, I had to fight for mine too. Isn’t it funny?

Melissa Jean-Baptiste:

Definitely. It’s just like, all right, well, this is what I want.

Tori Dunlap:

You’re like, and also, I know my brand. This is what I know will work.

Melissa Jean-Baptiste:

Exactly.

Tori Dunlap:

We’ll plug your book many times during this episode, but if you haven’t seen the cover of her book, she is in a shopping cart in a laundromat, reading a newspaper, magazine, newspaper. It’s so badass, and the color gradient on it, it’s just a really cool book cover. We don’t get a lot of cool book covers, especially for nonfiction books. Yeah, it’s badass.

Melissa Jean-Baptiste:

Thank you.

Tori Dunlap:

I’m so excited to have you on the show. We have been internet friends for a long time, and this is actually the first time we’ve chatted, which is so cool. We ask every finance creator, money expert that comes on the show, what was your first money memory?

Melissa Jean-Baptiste:

My mom’s going to be like, “Why do you keep telling this story?” My first money memory, I was eight years old. We were doing back to school shopping. It was me and my little brother and we were in a store. My parents, who are still married, very happy in love, she had started doing joint accounts. They had a joint credit card. She goes to buy this pair of shoes for school. She swipes and she gets declined. I remember she turns around furiously and she’s like, “Never open a joint account with a man.”

I’m l
ike, I’m eight by the way. I’m just like, okay, but that’s honestly the first thing I ever remember. Obviously, as I grew and evolved and learned more, I really understood what she was trying to tell me. It’s really a great story. I take that as really just keep your financial independence no matter what state, no matter what is your relationship status. Even now today, she’s like, “I still don’t. Don’t do that.” I’m like, okay, all right, mom, thanks. That’s my favorite and first money memory.

Tori Dunlap:

What great advice though, right? It’s just like when you’re eight, it might be a little lost on you. I think it’s just don’t be dependent on any person, especially not a man, right?

Melissa Jean-Baptiste:

Yeah.

Tori Dunlap:

I know you talk about this, we talk about this all the time, it’s just like money buys you freedom. It buys you the ability to not be in a situation you don’t want to be in. There’s something so powerful about making financial choices for yourself as a woman.

Melissa Jean-Baptiste:

Absolutely, even at eight.

Tori Dunlap:

Right. Right. I love that. I love that your mom’s just happily married, but do not ever do that.

Melissa Jean-Baptiste:

Yeah. She’s like, “Don’t even think about it.”

Tori Dunlap:

You have done lots of incredible things, traveled to 25 states. You’ve jumped out of planes. You’ve bought a house on a teacher’s salary. You grabbed two degrees and you paid off a 100K of student loans before turning 35 for those two degrees. Can you take us on a tour of the start of your career and then how you built Millennial In Debt from your experience?

Melissa Jean-Baptiste:

Yes. I love that intro to that question. Thank you. I am first generation Haitian American. I’m also the eldest daughter. Anyone in any of those two categories listening, they know automatically you just carry this burden on your shoulders of you got to make your family proud. You have to make your parents proud. You have to do the absolute best, and you can’t make any mistakes because your parents worked so hard. As the eldest daughter, I’m like, okay, well, I have to go to college.

I have to get a degree in something. I have to get a job using that degree, and then I have to get my ass out of my parents’ house. I have to move out of my parents’ house. That’s the goal, that’s the trajectory I’m supposed to be on. When I graduated at 22 and I’m just like, okay, I’ve got the degrees. I’ve got the teaching job, and now I’m going to just work and pay my bills so that I can get this house. At 25 in 2013, I called a real estate agent. I’m like, okay, I’m ready. I want to get pre-approved.

I want to do all these things. I go through the pre-approval process and I get approved for $100,000, which honestly, they shouldn’t approve me for anything. I didn’t even have a savings account, but I got approved for $100,000. In New York, that’s not getting you anything. You might get a Barbie house with $100,000. Of course, I start the crying and I’m just like, I pay all my bills. I have good credit. I don’t understand why I’m not approved for more.

That’s where that conversation pretty much changed my life. He was just like, “Your debt to income ratio is way too high.” I’m like, sir, my what? What are you talking about?

Tori Dunlap:

I was just going to pause you and ask if you could define it for the listener.

Melissa Jean-Baptiste:

Yes, absolutely. Essentially when you are trying to borrow money, they look at you as a risk. How much risk are they willing to take? Your debt to income ratio is how much debt you already have versus how much you are making. What they’re doing with that number is they’re calculating how much more debt you can take on, so how much more risk they’re willing to take.

I was on a teacher salary. I was making about $50,000 a year, and I had about 50, so I thought, I had about $50,000 in student loans. He’s just like, “Nah, your risk is maxed out. They’re not going to give you any more money,” which is why I didn’t even know why I got approved for the 100,000, honestly. I was just like, you should have gave me zero.

Tori Dunlap:

Well, they did it probably to make money off of you. Because if you are a risk, they’re thinking, oh, she’s not going to pay her money back, so we get to charge her a shit ton in interest and late payment fees. That’s part of many reasons why 2008 happened. People who could not afford these huge houses got approved for these huge houses, and then because ultimately a good chunk of financial companies are just greedy motherfuckers.

Melissa Jean-Baptiste:

Yeah, they just want to make as much money from you as possible. He’s just like, “If you want the bigger mortgage, if you want to be approved for more, go speak to your loan provider and see what you can do to accelerate your student loan debt payoff.” I’m like, okay. I go. I contact, and that is when I find out that I had more than $50,000 in student loans, although I only borrowed $50,000 in student loans. The provider told me, “Well, you’re on an interest only payment plan.”

At that point in 2013, after three years of payments, I actually owed $20,000 more. Obviously I was just like, well, I have failed. First generation, eldest daughter, I failed. I didn’t do what I thought I was doing. I didn’t do what I was supposed to be doing. After many, many, many days of crying and feeling like an ultimate failure, I really decided, okay, I can’t live at home until I’m 65. I can’t just stay in this moment and just feel sorry for myself because it’s not going to solve anything. I’m not going to get this house.

Honestly, and I’m going to share, I haven’t shared the reason I really, really, really wanted to get my own space, I wanted to have adult relations not in my parents’ house. I didn’t want to do all those things in my parents’ house. I’m like, it’s probably time to get a house to get my own space.

Tori Dunlap:

That’s valid.

Melissa Jean-Baptiste:

I was just like, that’s going to be one of my motivators. I want to get my own space so I can do my own adult activities in my own space. I really started learning about what passive income was. I started learning what a sinking fund was, an emergency savings account, and really started trying to build multiple streams of income because the $50,000 annual salary as a teacher wasn’t going to cut it. I just wasn’t going to be able to move the needle if I did not make more money. I think tha
t’s such a crucial conversation in this space because we can save, we can budget, we can do everything.

But if my bills are $5,000 and I only make $2,000, what am I budgeting? Nothing. I’m in the red. I started selling my lesson plans and my unit plans, because I was already teaching. I already had the know-how. I started making an extra $10,000 a year just by doing that. I would throw that directly at the principal of my loans, but it wasn’t enough for me. I wanted to live. I wanted to go to brunch. I wanted to go to Thailand. 2013-2014 was big for Thailand and millennials.

Tori Dunlap:

It was just Bali. Everything was Bali.

Melissa Jean-Baptiste:

I’m like, how are y’all going? How are you affording these flights? I started asking conversations to my closer friends at first, and they were like, “Girl, debt. We’re credit. We can’t really afford anything. We’re just swipe and then think about it later.” I’m like, oh, so you’re in this same shit show as I am. Cool. I started asking more family members and friends and learned that none of us actually really knew what we were doing. We were all just scrambling and sitting in this embarrassment and depression on our own without having these conversations.

I decided, you know what? I’m going to make fun of it. I’m going to make fun of myself, make fun of all of the others, but also add some educational piece to it. I wrote the Millennial In Debt Web Series, and I made fun of how much I did not know about buying a car. I did not know about student loans. I didn’t know all these things. It got really big on YouTube, and I was just like, oh, people want to talk about this. People care about this. Everything really just happened by chance. I was like, I guess I’ll make an Instagram.

I don’t know. We’ll see what happens with that. It just started picking up from there, and I’m like, oh, I guess I’ll make a blog. Everything was like, I guess I’ll do this. It just really all came together into this brand, this educational platform where people didn’t feel the shame. People didn’t feel embarrassed because they had someplace to go to learn and ask questions and share their stories as well. That is how Millennial In Debt was born.

Tori Dunlap:

I have so many follow up questions. Debt payoff journey, let’s talk about that because I want to start from where you realized that you wanted to pay it off sooner rather than later or maybe even before then of like, I didn’t realize I had, what, double the amount of loans. You had 50,000, but actually you had 100.

One of the things that I talk about all the time with student loans is that I remember I was getting a TikTok comment every other day about it for a while where people are like, “I am paying off my loans. I’ve been doing it for years, and yet this was the first time I checked my balance since I graduated and I haven’t either made any progress or very little progress or actually I owe more than I did before.”

Can you first maybe talk about the personal finance side of that of how that’s possible, how that happens, and then walk us through your mindset and you’re like, okay, we’re going to figure this out, how to pay this off?

Melissa Jean-Baptiste:

Yes. I talk about this all the time because a lot of times when we talk about we should have loan forgiveness, people will say, “Well, pay what you borrowed. You got yourself in this mess.” But we don’t talk about the predatory nature of what student loan companies do. For my case, when I received that letter where it was like you could pay $1,500 a month as your standard payment, or you can pay $200 a month. As a teacher making very little money, I’m going to go with the $200 a month.

But what they didn’t tell me or what I didn’t understand was that $200 a month was only going towards the interest that I was accruing, which means the principal, the actual money you borrow is not being tackled at all.

Tori Dunlap:

I want to pause you, credit card companies do this too. They say, “Okay, you put $1,000 in a credit card, but you can just pay 200. That’s fine.” But of course, if you have any personal finance knowledge, you’re going, wait, there’s got to be a catch, right? But a lot of people either don’t want to think about it, they ignore it, they’re like, “Oh, that feels weird, but I guess it’s fine,” or there is this level of they’re not as transparent as they could be.

It is in the fine print. It has to be there legally somewhere, but they’re not as outwardly transparent because, of course, this is how this company makes money. This happens with a lot of pieces of debt, student loans, credit cards is they say, “Yeah, you owe this technically, but you can pay less in exchange for a bunch of interest.”

Melissa Jean-Baptiste:

Right. The thing that’s so tricky about this is for my case, I had private loans and federal loans, and private loans have a lot less regulation than the federal loans. What ended up happening, not only was I paying this interest, but the interest that I was paying wasn’t covering the actual interest being added every month. I was on a variable interest plan. I did not, at 17, 18 years old, I had no idea what standardized, unsubsidized, subsidized, variable, I didn’t know what any of that meant.

I just knew I wanted to go to school and get my degree and I needed this money to do so. When I signed these, I looked back as an adult that understood, when I looked back, I signed these loans at 7%, at 8% interest. The time that I paid these loans off, my final payment was in 2018, my highest rate was 16% interest. That was higher than my credit card at the time.

I’m just like, how could you allow me at 17 years old to sign this and then double my interest, not give me a notification, not really tell me, “Yes, it’s in the little tiny, tiny fine print,” but I’m paying you $200 a month for three, four, five years, and you’re adding in $500 interest, $600 interest every month. It’s just like I’m never going to dig myself out of this and I’m not going to understand why until I sit down and really learn and teach myself these financial skills.

Tori Dunlap:

Again, when we talk about personal finance, you and I both and many of our friends, it’s not just here’s how to budget, here’s how a loan works. Because we actually know, I know this from research for my book, is that actually women go into debt because they don’t know how a loan works. That’s actually the number one reason. There’s all of this, yes, the education and also the personal choice, and also, there’s a student debt crisis.

There are things outside of our control, and this is why we need policy change and why we need so much more structural support other than just suck up and pay your loans from people who went to college in 1970 and college costs $12. It’s not the same experience anymore. I graduated in 2016 and I looked at what my college charged us for a year. Now, I love my college. They would, I’m sure, ask me and demand that I say that 99% of kids get some s
ort of aid, but a year of college now at my university is like $62,000. That is bonkers crazy. That’s insane.

Melissa Jean-Baptiste:

Same experience. I’m just like, I love my school, but what is going on? What?

Tori Dunlap:

John Mulaney has a bit about this. He’s like, 17 year old, I was in sweatpants and hung over, and I signed on the dotted line to be an English major and $120,000.

Melissa Jean-Baptiste:

Same.

Tori Dunlap:

It’s just crazy. Specifically too, I think with first gen Americans, there are many additional money challenges. Can you talk through what are some of the common ones faced by folks of color, especially first gen Americans?

Melissa Jean-Baptiste:

Absolutely. I say this all the time, it’s one of my favorite things, and it goes across all things, you don’t know what you don’t know. My parents came in, they tried to give us the best opportunities for education. When we are doing these things, it’s kind of like, oh, well, this looks like the most appealing. We’ll figure it out. Where other situations it’s like, let’s go in with a plan and this plan will have options. That’s the financially wise opportunity. I never had conversations about what affordability would look like for higher education.

I never looked into how much would textbooks cost, how much would staying on campus be versus staying at home, and having these conversations about looking into scholarships and what grants look like. Those weren’t things that we talked about because we just didn’t know we had those opportunities. In school I’m like, yeah, they apply for a scholarship, but they never said, “Well, what do you do if you don’t get that scholarship? Or what do you if you don’t get any scholarships?

Do you have another plan? Or what happens if you are in school and you have unsubsidized loans?” I wish I had known or I wish my parents had known that if I had taken this unsubsidized loan that I could make payments while I was in school. Because once you sign an unsubsidized loan, the minute you sign, they start charging you interest. It doesn’t matter if you’re in school or not, versus subsidized loans, they don’t have interest while you’re in school. These are things I didn’t know.

These are conversations that first gen Americans are not having because we simply don’t know the questions to ask. We don’t have the information, where if it was a personal finance class in 12th grade in high school or even freshmen seminar in college saying, “Hey, maybe look at the loans you’re taking or the loans you could stand to take. These are things you want to know and how it’ll impact you in a year, how it’ll impact you in four years,” where I’m just going in blind because it’s like, okay, well, I have to go to college.

This is the school I got into. It looks cool. The stats are great. We’re going to just go until the wheels fall off and the wheels, they always fall off. These are some of the things. It’s just we don’t have the questions because we don’t have the idea on what to be asking.

Tori Dunlap:

I think about, I grew up in the United States. I have many generations who did, and it’s complicated enough. If you grew up here, you’re still confused. It’s hard to imagine if you did grow up here and already feeling confused, imagine if you don’t even understand the general concept of a credit score. There’s so many things that no one teaches you. And then if you didn’t grow up in the system, you’re exactly right, you don’t know what questions to ask.

Melissa Jean-Baptiste:

They’re like, just do this FAFSA. Like, okay.

Tori Dunlap:

What does that stand for? What does that mean? The other thing you said that I know is a common experience with a lot of first gen Americans and a lot of especially women of color, is this like, I need to succeed and I need to succeed at a very high level. The entire expectation of my family and my legacy and our success and how hard they’ve worked to get me here are all on my shoulders.

Melissa Jean-Baptiste:

Yes. It’s not even like a, I need to succeed at some point. It’s an, I need to succeed now. There’s a sense of urgency. I’ll use my example. I went to a private university and I went into a program that was a five-year program. I ended up accelerating and doing it in four years and paying more money to do it that way because I couldn’t figure out how to tell my parents that I had to do an extra year in college, because the idea or what we see on TV or what the American Dream is, you go to high school for four years, you go to college for four years, and you come out and you start working.

I didn’t even understand or have the words to say, “Hey, this is a five-year program, so it’s not that I’m being left back, which would be the thought process. It’s just I have to do this extra year of school.” I was like, nope, I’m actually going to do this quicker, and then I’m going to get these two degrees. I’m going to pay extra because I need to graduate in four years so that my parents could see me walk across the stage. That state of urgency also removes the opportunity and the options to be more fiscally aware of what you could do.

I could have potentially gotten more grants or scholarships because at 21, I had not a great understanding, but a better understanding of what I could do. But I was just like, no, I need to pay this for this grad year and I need to go. That sense of urgency really fuels a lot of first gens because you have to make that impact as quick as possible.

Tori Dunlap:

Was investing even on your radar? Because I imagine if you feel the sense of urgency, we talk many times on the show about how investing is consistent, stable over a long period of time. It’s not like the get rich quick. It’s not the stuff that happens overnight. You’re shaking your head. People might not be able to see this.

It sounds like investing was not even on your radar, but then I imagine thinking about money as this long-term thing that does take time is directly juxtaposed with this feeling of I need to be successful immediately. I need this right now.

Melissa Jean-Baptiste:

Yes. I know no one could see us. I was shaking my head as you were speaking. I’m like, absolutely. I had the very, very, very fortunate opportunity of meeting my work mom early on in my career at 22 years old. She was a little older, and she’s just like, “You need to open a 403(b).” I’m like, girl, I don’t know what you’re saying. I’m going to be taking as much of my money home as possible. I’m already being taxed. There’s already this pension that I’m forced to be enrolled in. I don’t even care. I don’t care about 65. She’s like, “No, trust me. You need to open up a 403(b).”

These were not conversations I was having at home. My father does have a 401(k), but that was because he was automatically enrolled as a city worker, so it wasn’t something he was coming home and having conversations at the dinner table like, “Oh yeah, I invested in index out of my 401(k). He was just like, “This is money they’re taking out of my check. I don’t know.” When I opened the 403(b), it became that same type of feeling at home. It’s not something I was going home and saying like, “Oh, I just invested in these things.”

These weren’t conversations at the dinner table, but I’m so thankful that it became a conversation in my workplace because that 403(b) starting at 22 has let me, allowed me to reach Coast FIRE before 35. I love talking about Coast FIRE and essentially I was investing $121 a check. I hated every minute of it, but I’m so thankful that I did because starting off with that 121, I have a six figure portfolio that even if I never invest, I’ll have $1.8 million by the time I reach traditional retirement age.

I’m definitely trying to retire in five minutes, but it is nice to have that sense where it’s just like I don’t have to worry about what’s going to happen when I want to retire because of the work that I was pushed into gently by someone who knew and understand the importance of that long-term game. That time where it’s just like this money now that you don’t don’t get to spend is going to grow and really change the trajectory of your life in the future.

I’m very happy she pushed me to do that. It doesn’t mean I didn’t make other investment mistakes, but that was absolutely a game changer for me then and even now today.

Tori Dunlap:

When we’re thinking about investing, that is how we build generational wealth. I’ve had many conversations, especially with folks of color on the show about generational wealth, because when I hear that, when other people hear that, I think of yachts and succession and old money. I think of white families, and that has been the reality for many, many years, is that generational wealth is not only a privilege, but also something scoffed at because it’s just straight white men passing it on to their sons.

When we think about generational wealth, what does that mean to you? Of course, it’s the obvious barriers, racism, sexism, ableism, everything, but talk to me about some of the other things that you have to think about in building generational wealth as a woman of color, as a Black woman.

Melissa Jean-Baptiste:

Yes, I love this question. Generational wealth to me is the luxury of leisure and time. I always say time is our biggest currency. The wealthier you are or the stronger your lineage of generational wealth, the more access you have to your own time where you get to do things you want to do, where you get to have experiences you want to experience, where you get to learn and do all of these things that you simply cannot do if you have to work 60, 70, 80 hours a week or you work two, three jobs just to make sure that you’re able to eat, just to make sure that you’re able to keep a roof over your head.

Generational wealth means gaining that time for myself and being able to pass down the education as well, but that time where my children, their children, they are able to, yes, we’re going to invest, but we’re going to also have the opportunity to relax, to rest. Rest should not be something you have to earn. But unfortunately in this country, it’s something like if you rest when you have debt, you’re lazy. But it’s just generational wealth gives you that access to rest.

As a Black woman, rest is not something that is typically discussed as like, yeah, you go to school. You get a job. You work hard. You hustle hard, and you rest when you’re 65. You rest when you’re 70. For me, generational wealth has given me the access and opportunity to have my own time. That is really what wealth means to me in general.

Tori Dunlap:

I didn’t plan on asking you this, but I have seen a lot of people start talking on the internet about the word pleasure. We associate it with sexual pleasure, but it’s so much more. It’s just like ease, right? I think I wrote the word ease in my book way too much. It’s just like that is what money can buy you is ease. No inconvenience is actually an inconvenience. I’m in New York right now getting off the subway. If it’s pouring down rain, it’s like, okay, no worries. I can do something else. I can figure that out.

I think we have been denied pleasure as women, definitely orgasms and sexual pleasure, but we have been denied pleasure. When you think about food, a lot of women’s relationship with food is like don’t eat or don’t eat that thing. It’s too fatty and be as skinny as possible. Deny yourself the pleasure of a good carbonara. When you think about the pleasure of just a relaxing day where you don’t have to worry about work, capitalism will tell you, “Nope, you’re being lazy. You’re not being productive.”

We’ve I think lost sight, not because it’s our fault, but because we’ve been forced to lose sight of what feels pleasurable for us. Money’s the answer for that.

Melissa Jean-Baptiste:

Yes. No, I love that because I talk about how knowledge is pleasure, but health. People are like, well, money doesn’t buy happiness. I’m like, well, money keeps me healthy. I feel really happy that I could call up my therapist and schedule a session. I feel really happy that I can go to a chiropractor. I feel really happy that I could pay a copay.

You can’t tell me that pleasure and joy and happiness are not tied into finance when finances and money give me the opportunity to gain these things that I want, that make me happy. Especially on Twitter, they’re like, money doesn’t buy happiness. I’m like, listen, grow up. Okay? That quote, let it die. That is ridiculous. That’s not the life we’re living right now. We need the money to give us the joy and happiness we want.

Tori Dunlap:

I have a whole section in my book, I run through the myths that we believe about money, and one of them is like money can’t buy happiness. I’m like, that is a narrative meant to keep you underpaid and overworked and not pursuing money. Because yes, if you buy a Ferrari and you expect that to fix your problems, no, that’s not going to work. But it can buy me stability and safety and ease, and that is happiness or at least stability for me.

Melissa Jean-Baptiste:

Yeah, totally.

Tori Dunlap:

In your book, you state quote, “There is not a single wealthy person in existence that gained financial freedom with one income stream.”

Melissa Jean-Baptiste:

That is correct.

Tori Dunlap:

Let’s dive into this, because of course, I agree. I believe multiple streams of income, side hustles, diversifying, all of that can make a huge difference. But in the thread of lack of p
leasure and capitalism, most people are already working a ton. This idea of passive income, when you think of passive income, again, you think of a bro with a podcast talking about passive income and earning money.

Melissa Jean-Baptiste:

I know. Let’s take away the mics already.

Tori Dunlap:

Can you go through some of your income examples that you lay out in the book, and can an average person have passive income? Can an average person create more than just one source of income, typically like a 9:00 to 5:00 job?

Melissa Jean-Baptiste:

Absolutely. 1,000%. I think what happens is we’ve created this idea of passive income and side hustle culture into you have to do nine million things all the time just to get a little bit of extra money. The truth is passive income doesn’t always start off passive. That is something that is very, very true. But when I talk about when you set up these structures and you set up these things that you already know how to do, that you’ve already endure, that you’ve learned the skill, then you put in that little bit of work, it does become passive.

I talk about this. For example, my 9:00 to 5:00 at the time was teaching. I had to go in. I had to lesson plan. I had to do all these things, grade. Lesson planning and unit planning was taking me about 40 to 50 hours a month on top of teaching. It was not passive in the beginning. I’m like, this is ridiculous, I’m drowning. But I already had the skills and I saw the market available for lesson plans and unit plans for sale. I edited. I adjusted. I learned how to use Canva and all those things, and I put it on sale on this platform where teachers were going to like, “Okay, I need this idea. I need this.”

I put this up, and even now I have not been in the classroom almost two years in September, that’s kind of crazy, but I’m still making about three to $400 a month from those lesson plans and unit plans that I put up almost 10 years ago. Passive income does not have to be something that is so out of reach, or I have to go get a certification, or I have to learn how to code. It’s things that you already know how to do. You navigate, you do a little bit of elbow grease in the beginning, and you set it and forget it essentially, because I don’t even know the last time…

I look at the account when the money comes in, but I don’t know the last time I’ve updated those lesson plans or changed anything. It’s you set this up in the beginning. Same thing for creating Millennial In Debt, I was already in the beauty blogger space. I’m like, oh, I know how to do a page. I can just throw up a WordPress website and see. I’m already writing a lot. I’m an English major. Let’s see what happens. I’m using these skills that I already have and I’m just navigating it in a way where I want to create another stream of income.

I want this money to come in without having to go out and do a bunch of things. I’ve done that. I have seen that hustle culture take its way and side hustles where I was just like, I’m going to walk dogs, I’m going to tutor, I’m going to do all these things. It’s like, girl, you wake up at 5:00 AM to go teach. You get off at 3:00. You want to spend time with your family. You want to go to the gym. You want to rest. When are you going to dog walk? How is that going to fit into your schedule?

You want to lean into for passive income and side hustles things you know how to do, things you know that are going to have a return on investment and that people want to access or people are willing to pay for. That’s how you navigate that where you set it up and you get those multiple streams. Passive income is my favorite income, because I get tired. I’m like, I don’t want to do anything, but you have to do something a little bit in the beginning to get that set up.

Tori Dunlap:

The first time you make money while you sleep, it’s great. I want to highlight too, high-yield savings accounts are passive income. Putting your money in a high-yield savings account, again, I talk about high-yields, tattoo it on my forehead, but high-yield savings accounts, passive income. Investing, passive income. Now, with investing, typically you’re not getting that income immediately, but it’s money that is yours eventually. It’s very similar to your story.

One of the first products we ever created at Her First $100K, I literally posted about this on LinkedIn the other day, I took the resume I was using, literally just deleted some personal information, wrote a guide in the margins of why I was writing this way or why I was formatting this, so it was like a resume template plus a guide, that’s what we still sell on the website.

It was years of putting together a resume, years of research, and then sold the thing I was already using. Same thing with a cover letter template. The cover letter template was based on the cover letter that I would send when I was applying for jobs. There’s a lot of ways that you can take what’s already working for you or what you’ve already built. Somebody out there needs it.

Melissa Jean-Baptiste:

Yes, and I’m very for you put in the work, you should get paid for it. It’s just like don’t try to reinvent the wheel, use what you’re using and see who’s out there in the market for it.

Tori Dunlap:

You have a chapter in the book that’s called First Comes Love, Then Comes Prenup.

Melissa Jean-Baptiste:

Yes.

Tori Dunlap:

As someone who on my third date with my now partner was like, “Hi, just let you know, you’re signing a prenup if this goes forward.

Melissa Jean-Baptiste:

I know that’s right.

Tori Dunlap:

Yeah, I was very clear. Talk to me about the stereotypical version of what we think prenup relationships look like. I can also add my two cents in here. Why is prenup a dirty word and why shouldn’t it be?

Melissa Jean-Baptiste:

I love that, because I’ve also told my partner, “We’re signing that contract.” I think what really, really throws people off is this image that we’ve been fed through video, radio, TV, boobies, all these things where it’s like, “Oh, only really rich, wealthy people get a prenup because they don’t really love each other, they’re just in it for the money. And when they get a divorce.”

Tori Dunlap:

It’s like old guy, young woman. It’s like the 65-year-old Hugh Hefner marries the 24-year-old model.

Melissa Jean-Baptiste:

Exactly. It’s like, oh, I’m protecting my money. It’s like, yes, prenups absolutely protect your money, but they protect so much more. Same thing with estate plannin
g, you don’t want to leave your money up to the decision of the state. You worked for that money. New York doesn’t get to decide what happens to my money if I break up with my partner. You are really taking control and making sure that you get the say so, you get to decide what happens. No one goes into a marriage saying, “Yeah, we’re not going to work, so let’s get this prenup.”

That’s not what prenups are. I compare it essentially to a condom, and my mom was like, “Melissa!” But I’m like, yes, a prenup is a condom. It is protecting you and your partner from catastrophic disaster as you are doing adult things, and getting married is a very adult thing. Once we start looking at it like that, as a condom, I think it becomes more a part of our normalized conversation of, yes, we’re approaching marriage. We’re getting serious. Let’s look into what we want to protect as we’re entering into this union.

Tori Dunlap:

Kristen, that’s going on the Instagram. That’s great. I’ve never thought of it. I always say, if you are choosing to become legally partnered with somebody, you are signing a prenup. You mentioned the State of New York. Wherever you live is deciding what happens with your money, unless you choose differently. Prenups are, yeah, it’s this dirty word. It’s a scandalous thing. You have a prenup already, whether you know it or not. You have a prenup. Whether you choose to create one yourself because you want something different, you already have one.

You either like the states’, and spoiler alert, it’s probably not great. Your condom example was great. I have a less sexual answer, which is if I’m entering into business with somebody, I just got off speaking at this huge corporate company, there is a contract. Now, I have every intent that this is going to be a great experience. I have every intent, but I’m not going to not sign a contract. At the end of the day, yes, marriages hopefully are full of love and support and mutual admiration and affection.

They are also legally binding agreements, which is why you sign a marriage license, which is why you get tax breaks. If you are entering into some sort of financial partnership with somebody, whether that’s a business relationship or yes, a romantic relationship, you need to make sure that you and the other person have what they need in order to feel great.

Melissa Jean-Baptiste:

Yes, agreed. It’s just like, come on, let’s get on the same page here. We’re not doing anything wrong. It’s always like, “Oh, but you’re jinxing your relationship,” or I’m protecting it. We just need to change the narrative.

Tori Dunlap:

We were talking before about money gives you the freedom to not be in situations you don’t want to be in. On the flip side of that, there’s something actually so beautiful. I’ve talked about this with my partner because I definitely outearn him and we’ve had transparent conversations about that. There’s something actually so beautiful about the fact that one of us could leave this relationship at any time, but I’m choosing to stay.

It’s not about the money. It’s not like I need you for the money, or I need you for the stability, and so that’s the reason I’m staying. It’s like, actually, I’m here because I want to be here. I’m here because I love you and I want to be here. That is actually a great incredible gift that you can give somebody and give your partner.

Melissa Jean-Baptiste:

That was so beautifully said.

Tori Dunlap:

Thanks. It’s just so shameful and I fucking hate it. You mentioned estate planning, and I want to highlight this, because we haven’t talked about it a lot on the show because it is kind of unsexy, but talk to me about basic estate planning. We had Tiffany Budgetnista on the show.

Unfortunately, I don’t know if you know that she lost her husband unexpectedly, and we were talking about just the gift of his estate plan just being there and how much that alleviated the stress and the emotions she was already feeling. If somebody’s listening, let’s say they don’t have a bunch of assets, a trust wouldn’t make sense, what is the basic estate plan that they need in order to take care of themselves and the people they love?

Melissa Jean-Baptiste:

Yes. I always recommend two things, and they don’t require much time and they don’t require almost no money at all. All of the accounts that you do have, the assets that you do have, you want to at least have a beneficiary. That could be things just like your checking account or your savings account or your 401(k). You want to make sure that if something happens to you, that that money… Again, the state loves to just come in and make decisions for you.

You want to make sure that if something happens to you, that that money is not just going to sit there and just wait and people are going to decide, “Okay, you’ll get this about, you’ll get this,” or people are going to argue or fight. You want to say, “No, if something happens to me, the money in my checking account is going to go to my child, or the money in my checking account is going to go to my partner.” It’s super simple now. Financial institutions make it like you could just log into your digital account.

You could just add the name. Some of them ask for the social and birthday and then you’re done. It doesn’t take more than five minutes. Another thing, I know it sounds so morbid, but I made my dad do it and it doesn’t take too much time, doesn’t take too much money, you want to make sure you have a death folder. I have to come up with a sexier name for it, but essentially it’s a folder with all the passwords for things and the locations of things. The most recent, you could update it every year, every six months, however you…

Tori Dunlap:

My parents have a binder they told me. They have a huge binder.

Melissa Jean-Baptiste:

You just want to have it. If something happens, I’m not scrambling and going to a bunch of different places or trying to figure out, okay, well, what was the password for their phone? Or what was the password for the computer? How do I get access to their 401(k) balance and things like that? It’s just all in one place. This is going to be some of the saddest moments of your life. You don’t want to add the stressor of, oh my God, now I need to figure out how do they want to be buried, or how do they want all of these things.

It’s all in one place and then you know where to find it if anything happens. It’s not a sexy name, it’s not a sexy activity to do, but if you want to bring in a pizza. I did it over a pizza and I was like, okay, dad, let’s just do a little death folder. He’s like, what? I’m like, I’m working on the name, but let’s just do it. And then it’s in his drawer and that’s where it is. We update it annually, whenever we need to. And that’s it. Those are the two great places to start. It’s not going to be too stressful, and it’s not going to take much time or much money.

Tori Dunlap</str ong>:

If you believe and want to be the least selfish person you can, that is the gift you’re giving. I know it’s uncomfortable to talk about money. It’s also uncomfortable to talk about death. My last corporate job, I worked for a company that did online estate planning, and the amount of conversations that we were having with people who are just like, “I lost somebody.” It was just, “I’m already grieving. I’m already stressed about getting everything together and I don’t know what they want. I don’t know what is going to whom.”

Especially if you have young children, if you have children, guys, you need a will because you need to be able to assign guardianship. Yes, beneficiaries for financial accounts, but guardianship too. Because especially if you have fraught family dynamics or if you don’t want your children to go to a certain family member, again, talking about the prenup, when you have a document, that is what you want. You are in control of that. Especially if you are no longer with us, if you are dead, you can’t make that call.

Melissa Jean-Baptiste:

Yes, yes. You don’t get to decide anymore. You want to decide beforehand. I love New York, I love here, but I don’t trust them to decide what happens to anything in my life. I want to decide that.

Tori Dunlap:

It’s like the ultimate gift you can give your other loved ones who are trying to navigate this for you. This was such a great conversation. Thank you for being here. I just love your work and you know that, and I’m so excited for your book. Tell me about the book. Tell me about where we can get it. Plug away.

Melissa Jean-Baptiste:

Thank you. Yes. The book is called, So…This Is Why I’m Broke. You can find it everywhere books are sold or on sothisiswhyimbroke.com. It’s really just breaking down all of the crazy money things that we didn’t want to talk about, including all of the crazy money things that I have done right? If you want to laugh and you want to just feel like, okay, I’m not the only one making mistakes and learn along the way, then it’s absolutely the book for you. Thank you so much for having me on, Tori.

Tori Dunlap:

I love it. Thank you for being here. Thank you so much to Melissa for joining us on the show. You can go to the show notes, or you can follow her @millennialindebt. Her book, So…This Is Why I’m Broke, is also available wherever you get your books. Thank you as always for being here, Financial Feminist. We appreciate you subscribing, liking, sharing the show. Again, the easiest thing you can do to support the podcast that you love most is just hitting the subscribe button.

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Thank you for listening to Financial Feminist, a Her First $100K podcast. Financial Feminist is hosted by me, Tori Dunlap. Produced by Kristen Fields. Marketing and administration by Karina Patel, Sophia Cohen, Kahlil Dumas, Elizabeth McCumber, Beth Bowen, Amanda Leffew, Masha Bachmetyeva, Kailyn Sprinkle, Sumaya Mulla-Carillo, and Harvey Carlson.

Research by Ariel Johnson. Audio engineering by Austin Fields. Promotional graphics by Mary Stratton. Photography by Sarah Wolfe, and theme music by Jonah Cohen Sound. A huge thanks to the entire Her First $100K team and community for supporting the show. For more information about Financial Feminist, Her First $100K, or guests and episode show notes, visit financialfeministpodcast.com.