Speaker 1: If you haven't solved the root issue why you were
Speaker 1: racking up credit or turning to credit cards in general,
Speaker 1: then it's very likely that you will consolidate it and
Speaker 1: shift it onto a personal loan that you can focus on,
Speaker 1: but that you may just recreate the same problem a
Speaker 1: year from now or even less with how expensive things are. Hey,
Speaker 1: aba fan, what's up? It's your girl, Mandy Woodriff Santos
Speaker 1: aka Mandy Money, your host hostess with the Mostess. I'm
Speaker 1: actually here for a classic, a classic Brown Ambition episode,
Speaker 1: the Baqa where y'all got questions. I'm going to take
Speaker 1: them and give y'all some answers. But just a reminder
Speaker 1: if you're new here, this is answers with a lowercase A,
Speaker 1: meaning I am not your personal financial advisor. Don't sue me,
Speaker 1: don't come for me, don't say well Mandy said I
Speaker 1: should do. I am giving you like a besties perspective,
Speaker 1: like a really smart, financially savvy financial journalist for over
Speaker 1: a decade, podcast host for also a decade, knows a
Speaker 1: lot of stuff about money and career, like That's where
Speaker 1: I'm coming from here, But at the end of the day,
Speaker 1: I don't have all your info. I don't even I
Speaker 1: don't you know, I may not know you one hundred percent.
Speaker 1: So just take this with a huge grain of salt.
Speaker 1: Get your salt shakers out. Okay, now that I've covered
Speaker 1: myself legally, let's get into the real real because y'all's
Speaker 1: questions are becoming increasingly stressed, increasingly intense. And I got
Speaker 1: a question this week from a listener called A n
Speaker 1: and she emailed me directly, which, by the way, if
Speaker 1: you want to get your questions financial investing, career, whatever
Speaker 1: it may be, you can email me Browdambition Podcast at
Speaker 1: gmail dot com or slide into my DMS. I'm at
Speaker 1: Brown Ambition Podcast on ig. If you want to be anonymous,
Speaker 1: that's cool. If you want to use a pseudonym, also great.
Speaker 1: If you want me to say your full name so
Speaker 1: everybody knows who it is that's asking the question. You know,
Speaker 1: it's a to y'all. The point is I want to
Speaker 1: give y'all a chance who may not be able to
Speaker 1: get access to my coaching program to me one on
Speaker 1: one ask your questions. You don't have to go through
Speaker 1: hardshit alone, and that is what I'm here for. Okay, Okay,
Speaker 1: BA fan, stay tuned. We'll be right back now. Other
Speaker 1: housekeeping stuff, what else is going on? We have a
Speaker 1: new intern, a new producer intern, BA fan. We want
Speaker 1: to say hello to our brand new producer intern, Miss Gabrielle.
Speaker 1: Welcome her. And Gabrielle is a upcoming college sophomore at
Speaker 1: Syracuse University, which is an incredible journalism program. And this
Speaker 1: is a really good example of how if you want
Speaker 1: to know, if you want to put yourself in the
Speaker 1: room where opportunities can happen to you. Gabrielle is an
Speaker 1: incredible example of that because I ran into her. I
Speaker 1: met her because she asked a question at an event
Speaker 1: that I went to for an author and former guest
Speaker 1: of the show, Alencia Johnson, when her book came out
Speaker 1: Flip the Tables. Both me and Gabrielle happened to go
Speaker 1: downtown to the Barnes and Noble in the Upper West
Speaker 1: Side where Alencia was giving a talk, and Gabrielle raised
Speaker 1: her hand also she went with her mom, which is
Speaker 1: just adorable. She raised her hand, she asked a great question,
Speaker 1: and I was at that point where I'm like, I
Speaker 1: would love to work with a college student to give
Speaker 1: them some real hands on experience in you know, podcasting,
Speaker 1: and to be able to help with this brand and
Speaker 1: also the youths. I need to connect with the youths.
Speaker 1: So I heard Gabrielle's question. I walked up to her.
Speaker 1: I was like, okay, tell me about yourself. You said
Speaker 1: you went to Syracuse. What's all going on? Do you
Speaker 1: want an internship? This was maybe back in February March,
Speaker 1: I want to say. So she's like, well, I have school,
Speaker 1: but let's talk. And so we talked. You know, she
Speaker 1: sent me her resume, her clips. I got to know
Speaker 1: her a little bit better, and then I was like,
Speaker 1: you know, when do your finals over, can you start then?
Speaker 1: And that's exactly what's happened. So she's going to be
Speaker 1: with us for the summer and we'll see about the future.
Speaker 1: But very excited to give her this opportunity, and I
Speaker 1: know she's gonna smash it. All right, So let's get
Speaker 1: into today's question, y'all. This is from a listener who
Speaker 1: wants me to call her a ny and she has
Speaker 1: a question about credit card debt. And I says, first
Speaker 1: and foremost, Mandy, I want to let you know I
Speaker 1: have been a huge fan of the brown Envision podcast,
Speaker 1: a dedicated listener for the past six years. Y'all have
Speaker 1: helped me so much with valuable information throughout the years.
Speaker 1: I could really use some solid financial advice right now.
Speaker 1: I'm carrying a total of eleven thousand, five hundred and
Speaker 1: fifty seven dollars and twenty six cents of credit card debt.
Speaker 1: I have an American Express card with a twenty nine
Speaker 1: point nine to nine percent interest rate, a Capital One
Speaker 1: card at twenty eight point twenty four percent, another one
Speaker 1: at thirty one point two percent, and my PayPal credit
Speaker 1: is at thirty point thirty nine percent. With these high rates,
Speaker 1: it feels like I'm barely making a dent in these balances.
Speaker 1: Would it be wise to take out a personal loan
Speaker 1: with a lo interest rate to consolidate and pay off
Speaker 1: these cards and then focus on paying down that loan instead.
Speaker 1: I also have student loans, but that's a whole separate conversation.
Speaker 1: Thank you, all right, And I that's really expensive debt.
Speaker 1: I'm glad that you only have eleven thousand. I know
Speaker 1: that that number seems really high, and it is. I mean,
Speaker 1: it's a lot of debt, right, but I'm glad it's
Speaker 1: not worse, because that can easily double. Like with these
Speaker 1: interest rates. There are some interest calculators that you can use.
Speaker 1: I know bank rate has one investor dot gov. You
Speaker 1: can put this into a calculator and see what's going
Speaker 1: to happen to those credit card balances. If you continue
Speaker 1: to just pay you the monthly payment and you're not
Speaker 1: actually chipping away at that principal amount, it can really balloon.
Speaker 1: I actually do think, in my personal opinion, that it
Speaker 1: would be wise to take out a debt consolidation loan. Now.
Speaker 1: It's not going to eliminate your debt, right and I
Speaker 1: don't want you to. This is the hard part when
Speaker 1: you pay down those credit cards. If you haven't solved
Speaker 1: the root issue, like if you haven't gotten to the
Speaker 1: bottom of why you were racking up credit or turning
Speaker 1: to credit cards in general, then it's very likely that
Speaker 1: you will consolidate it and shift it onto a personal
Speaker 1: loan that you can focus on, but that you may
Speaker 1: just recreate the same problem a year from now or
Speaker 1: even less with how expensive things are. So that's something
Speaker 1: to consider for right now when you do feel like
Speaker 1: you are bleeding from these high interest rates. I would
Speaker 1: start shopping for a debt consolidation loan. I recommend starting
Speaker 1: with your local credit union. I recommend shopping around online,
Speaker 1: looking for some online lenders because they tend to have
Speaker 1: fewer fees and be more affordable. Obviously, read reviews, read
Speaker 1: the fine print. There's a lot of great content out
Speaker 1: there where people you know will rigorously test and vet
Speaker 1: these different products for consumers. I used to work at
Speaker 1: a website called lending Tree, Magnify Money, you know Value Penguin,
Speaker 1: where it was our job to really like drill into
Speaker 1: the fine print of these types of products and help
Speaker 1: consumers make educated decisions when they're comparing. So do your
Speaker 1: due diligence. The one great thing about credit unions is
Speaker 1: they have an eighteen percent cap on their credit cards,
Speaker 1: and I believe it applies to loans as well. Also,
Speaker 1: credit unions may be more willing to work with you
Speaker 1: if you don't have the most, you know, the greatest credit.
Speaker 1: And what I want to avoid is, you know, with
Speaker 1: these high interest rates, I'm going to guess your credit
Speaker 1: score is probably in like the fair category, maybe like six'
Speaker 1: eighty mid six hundreds. And it doesn't mean it's impossible
Speaker 1: to get a debt consolidation loan, it just means that
Speaker 1: you may not save as much as you were hoping. Yeah,
Speaker 1: that can be kind of disappointing. And if you get
Speaker 1: a debt consolidation loan and the interest rate is maybe
Speaker 1: not even that much better than the interest rate you
Speaker 1: have in your credit card debt right now, then it
Speaker 1: becomes a decision about simplicity and also a fixed rate
Speaker 1: versus a variable rate. One of the key differences with
Speaker 1: a person alone is that you have a fixed interest rate.
Speaker 1: Credit cards have a variable interest rate, and the more
Speaker 1: the Fed, you know, tweaks the interest rate and raises
Speaker 1: it lowers it, that can impact the interest rate on
Speaker 1: our credit cards. It's very well likely possible that when
Speaker 1: you first took out these credit cards, your interest rate
Speaker 1: was better than it is now, but rates have been
Speaker 1: rising and here we are, so with a personal loan,
Speaker 1: like let's say it's high twenties in terms of like APR,
Speaker 1: which doesn't sound great, but you're not just but at
Speaker 1: least you know then the interest rate is going to
Speaker 1: be fixed and no matter what the Fed does, it'll stay.
Speaker 1: You're also going to get a fixed repayment term, which
Speaker 1: means they're going to give you a loan for like
Speaker 1: thirty six months, forty eight months, whatever it may be.
Speaker 1: And then you know, by the time this time is over,
Speaker 1: I'm going to have one monthly payment. It's going to
Speaker 1: be a fixed rate, and I know when I'm going
Speaker 1: to have this debt paid off. And then you don't
Speaker 1: have four different credit cards to keep track of, right
Speaker 1: you have like four or five different credit cards to
Speaker 1: keep track of. You have that one payment. But I
Speaker 1: really encourage you, like to get rigorous and get really
Speaker 1: diligent with your tracking of your expenses and your overall
Speaker 1: budget because getting to the root cause of what's caught,
Speaker 1: what's led to this, you know, five figure credit card debt,
Speaker 1: that is what's going to help you prevented from happening now.
Speaker 1: And listen, I am not here to judge. It is
Speaker 1: so expensive in these streets, and as an entrepreneur, as
Speaker 1: a mom, you know, with a mortgage, and y'all know,
Speaker 1: I got these kids in daycare and after school activities
Speaker 1: and summer camps is coming up. My goodness, I one
Speaker 1: hundred percent can see how in just a few months
Speaker 1: you can have this much credit card debt and then
Speaker 1: it becomes really stressful and it weighs on you. Hey,
Speaker 1: ba fam, we got to take a quick break, pay
Speaker 1: some bills, and we'll be right back. All right, ba fam,
Speaker 1: We're back. So I just want you to know it's
Speaker 1: not at all something that you know. And I just
Speaker 1: had Asia Evans, a financial therapist, on the show. If
Speaker 1: y'all haven't listened to that episode from Wednesday, please go
Speaker 1: check it out because we talk about mindset around debt
Speaker 1: and how it's important not to put so much focus
Speaker 1: or like really like get down on yourself on a
Speaker 1: personal level because you have this debt. Like I'm dumb,
Speaker 1: I'm you know, I made some poor choices. What's wrong
Speaker 1: with me? I should know better. That's not helpful. It's
Speaker 1: not helpful. You're probably making the best decision with the
Speaker 1: options that you have. And there's this famous quote, at
Speaker 1: least for me. In this series Little Fires Everywhere, where,
Speaker 1: Carrie Washington's character is talking to Reese Witherspoon's wasp neighbor
Speaker 1: character and she's like, Reese Witherspoon's character is judging Carrie's
Speaker 1: character for the choices she made about her daughter, and
Speaker 1: Carrie Washington is like, you didn't make good choices. You
Speaker 1: had good choices, And that says so much about privilege
Speaker 1: and about just the fact that we're all out here
Speaker 1: doing our best with the plate we have, like the
Speaker 1: lot we have in life. And yeah, unfortunately that does
Speaker 1: look like putting things on credit that you may not
Speaker 1: be able to pay off right away. But let's just
Speaker 1: like set that aside. You know, acknowledge that you're doing
Speaker 1: the best you can. You're listening to Brown Ambition. You
Speaker 1: sent me your question. You know, I really hope that
Speaker 1: this is helpful for you and that you can start
Speaker 1: chipping away at that debt. And another good thing about
Speaker 1: a debt consolidation loan is when you take out that
Speaker 1: loan and use that money to pay off these credit
Speaker 1: card balances immediately, your credit score should go way up
Speaker 1: because your credit score, yes, you still have the same
Speaker 1: amount of debt, you haven't eliminated that debt. That personal
Speaker 1: loan will appear on your credit report, but it's not
Speaker 1: a line of credit. It is a fixed term loan.
Speaker 1: It's not a revolving credit line like your credit card
Speaker 1: debt was, and your credit score should benefit from that
Speaker 1: because revolving high interest debt can drag down your score,
Speaker 1: especially when you have a lot of it, you know,
Speaker 1: compared to your total available limit you know, utilization rate.
Speaker 1: That's how much of your credit card limit you're using
Speaker 1: versus how much your limit is. And another sneaky thing
Speaker 1: that credit cards do that you may not even realize
Speaker 1: when you're someone who is continually racking up and adding
Speaker 1: more to your credit card is they will adjust your balance.
Speaker 1: So you may think you have like a twenty thousand
Speaker 1: dollars limit, but if they see that you are getting
Speaker 1: close to hitting that limit and you're not paying it
Speaker 1: down in full each month, they can of their own
Speaker 1: will just go in there and reduce your your limit
Speaker 1: because they're afraid that it's looking like an I may
Speaker 1: not be able to pay this off, so let's actually
Speaker 1: decrease her limit so she doesn't take on even more
Speaker 1: debt that we're not going to get paid back for.
Speaker 1: So that can hinder your credit score, because all of
Speaker 1: a sudden, you may have five K, you know, on
Speaker 1: a ten K card, which which gives you a fifty
Speaker 1: percent utilization rate, and that's not great, but it's not terrible.
Speaker 1: Then they maybe they chop that limit in half and
Speaker 1: now that five k is on a card that has
Speaker 1: a five five hundred dollars limit, and now your utilization
Speaker 1: is almost at one hundred percent. And so that is
Speaker 1: how you know, even these like little things behind the
Speaker 1: scenes can be impacting your credit as you are relying
Speaker 1: more on credit cards and using those on a revolving
Speaker 1: basis and not paying them down in full. So and
Speaker 1: I hope this is helpful. I also like, if it
Speaker 1: comes down to being a budget issue and you have
Speaker 1: cut everything that you can possibly cut from your budget,
Speaker 1: then I would say it's time to start looking for
Speaker 1: additional sources of income. And maybe once you have a
Speaker 1: one fixed rate debt consolidation loan payment to worry about
Speaker 1: each month, you can come up with a side hustle,
Speaker 1: you know, a way to bring an extra income and
Speaker 1: just use that money and say this is going to
Speaker 1: be to pay on this debt consolidation loan. And that's
Speaker 1: how I'm going to you know, be able to move
Speaker 1: forward and create that space in my budget for this
Speaker 1: new expense. Hey, bafam, we got to take a quick break,
Speaker 1: pay some bills and we'll be right back. Welcome back,
Speaker 1: BA fam. Let's get back to the show, all right,
Speaker 1: and I think I've said everything I possibly could say
Speaker 1: on this. I want to wish you well. I want
Speaker 1: to wish you luck, and to our listeners who are
Speaker 1: also struggling with credit card debt, I want to hear
Speaker 1: from y'all. Could you email me Brand Ambition Podcast at
Speaker 1: gmail dot com or dm me at Brand Ambition Podcast
Speaker 1: on Instagram and let me know how much debt you have,
Speaker 1: how you're managing it, and even if that's the first
Speaker 1: time in a long time you have gone and actually
Speaker 1: looked at all of your accounts. And just because Mandy
Speaker 1: asked you how much debt you have, you don't have
Speaker 1: to tell me, but I at least want us together
Speaker 1: to hold hands and like, go check our balances right now.
Speaker 1: Check your balances, check your limit, see if it's been changing.
Speaker 1: You know, it's so easy to get a free credit report,
Speaker 1: a free credit score these days online. Probably all your
Speaker 1: banks offer some version of that. So let's actually look
Speaker 1: at it. I know better than anyone that it's really
Speaker 1: easy to just like stick your head in the sand.
Speaker 1: It's nice and dark in the sand. You don't have
Speaker 1: to look at stuff that stresses you out. But now
Speaker 1: I have one of my recent gas rokel Odin from
Speaker 1: HSBC Bank. I have her voice in my head like,
Speaker 1: look at it. You have to look at it, even
Speaker 1: if it's scary. It's not going to go away just
Speaker 1: because you're avoiding it, and in fact, it make it
Speaker 1: even worse. So I encourage y'all go check out your balances.
Speaker 1: If you need a spreadsheet, you're going to use a
Speaker 1: tracking app like I do. I use Rocket Money. Do
Speaker 1: what you got to do to get all of your
Speaker 1: ducks in a row, your financial ducks in a row,
Speaker 1: and then we can start strategically paying them down. And
Speaker 1: if you're wondering, like mey, hey, Mandy, why didn't you
Speaker 1: recommend that? And I just did the debt snowball or
Speaker 1: the debt avalanche method, that's also something like if you
Speaker 1: really want to tackle this debt and you know you
Speaker 1: don't want to take out that personal loan or an eye,
Speaker 1: if you go and apply for a personal loan and
Speaker 1: you find out that they're not going to give you
Speaker 1: an APR that's any better than these credit cards, then
Speaker 1: maybe at that point it's like, well, what's the point
Speaker 1: I offered you all the pros of a personal loan?
Speaker 1: So there still is a case to be made for
Speaker 1: taking one out. But if you were just going to
Speaker 1: tackle this one card at a time, the interest rates
Speaker 1: are all so similar, it might make more sense for
Speaker 1: you to take the debt snowball approach where you order
Speaker 1: them from the highest to lowest balance or the lowest
Speaker 1: to highest balances, and you pay down your smallest balance
Speaker 1: first and then you just like let that. You know,
Speaker 1: even though it's not going to save you the most
Speaker 1: on interest technically over time, it does really help to
Speaker 1: get that momentum going and to help give you a
Speaker 1: bit of like positive reinforcement to see that progress being made.
Speaker 1: I'm interested to hear what you do. Please follow up
Speaker 1: with me and ba fan. Thank you so much for listening.
Speaker 1: I would love if y'all could take a second to
Speaker 1: leave me review on Spotify or Apple Podcasts. It's so important,
Speaker 1: especially at its where everything in the economy is a
Speaker 1: little Craig crag that includes the podcasting space, So your
Speaker 1: support means so much to me. If you haven't left review,
Speaker 1: it takes less than twenty seconds to do. You can
Speaker 1: you scroll on your app right now find out where
Speaker 1: you can leave the review. Leave some kind words. I
Speaker 1: do love them. And I'm actually gonna shout out a
Speaker 1: reviewer right now because I love reading y'all's reviews so much.
Speaker 1: All right, let me go find one. There you go,
Speaker 1: all right? From listener WGSSF, she says, yay Moms five stars, Mandy,
Speaker 1: I love, love, love your Mother's Day episode with Moms
Speaker 1: Reina and Jessica. I love how honest and thoughtful y'all were.
Speaker 1: Your conversation was about the difficult balance that motherhood can bring.
Speaker 1: Thank you for your candid takes on life and money.
Speaker 1: And then listener are and Optional says so good, Thank
Speaker 1: you five stars. Eal been listening for years. Mandy is
Speaker 1: handling solo hosting with great Brown Tables and continues to
Speaker 1: bring amazing guests. I also love how vulnerable she is
Speaker 1: in her motherhood season. Keeping it real is how we
Speaker 1: support each other. Thank you. That is so so kind.
Speaker 1: Ba fam. I read all your reviews. I can't wait
Speaker 1: to read some more. Thank you so much. And while
Speaker 1: you're at it, shared this episode with someone who you
Speaker 1: think might need to hear it and tell a friend,
Speaker 1: Tell a friend. Until next time, I am your host.
Speaker 1: Mandy Wichard Santos aka Mandy Money, and thanks so much
Speaker 1: for listening. Bye okay va fam, thank you so much
Speaker 1: for listening to this week's show. I want to shout
Speaker 1: out to our production team, Courtney, our editor, Carla, our
Speaker 1: fearless leader for idea to launch productions. I want to
Speaker 1: shout out my assistant Lauda Escalante and Cameron McNair for
Speaker 1: helping me put the show together. It is not a
Speaker 1: one person project, as much as I have tried to
Speaker 1: make it so these past ten years. I need help, y'all,
Speaker 1: and thank goodness I've been able to put this team
Speaker 1: around me to support me on this journey. And to
Speaker 1: y'all be a I love you so so so so much.
Speaker 1: Please rate, review, subscribe, make sure you sign up to
Speaker 1: the newsletter to get all the latest updates on upcoming episodes,
Speaker 1: our tenth year anniversary celebrations to come, and until next time,
Speaker 1: talk to you soon via bye