WEBVTT - BA Q&A: Emergency Savings Is A Safety Net ft. Shauntae

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<v Speaker 1>It's time for the b a q a A. The

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<v Speaker 1>b a q A what to say? The b a

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<v Speaker 1>q A with Manday although she's out sick today, the

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<v Speaker 1>b a q A with him today, the b a.

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<v Speaker 2>Q a A.

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<v Speaker 1>It is time for Brianna Vision Questions and answers. You

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<v Speaker 1>have some questions, We have some answers. Well today is

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<v Speaker 1>just me because maybe have the nerve to have lost

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<v Speaker 1>her voice, honey. But I'll be the voice for both

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<v Speaker 1>of us. So although we have some answers, I don't

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<v Speaker 1>have all the answers.

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<v Speaker 3>Right.

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<v Speaker 1>I'm not your auntie, I'm not your mom, not your

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<v Speaker 1>financial advisor, your attorney, but I am a smart brown

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<v Speaker 1>girl when it comes to some money, career, business, etcetera.

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<v Speaker 2>So we have a guest today on b a q

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<v Speaker 2>A with day Shante.

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<v Speaker 1>To be exactly, she's be a listener and she has

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<v Speaker 1>a really great question.

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<v Speaker 2>So we invited her. Come on.

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<v Speaker 1>If you want to be invited to come on, and

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<v Speaker 1>you know you don't do go head on to Branna

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<v Speaker 1>Vision podcast, especially on Instagram. Leave us a voice note,

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<v Speaker 1>like a message voice note. When you do that, our

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<v Speaker 1>producer MANI will listen, and you know she might invite

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<v Speaker 1>you on okay, just like you won't be like you

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<v Speaker 1>know you do.

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<v Speaker 2>Welcome Sante. How are you? I'm good and you I'm

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<v Speaker 2>good good. Where are you from, Santa? I am from

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<v Speaker 2>the West Coast. I think I put that in the message.

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<v Speaker 4>I don't know why I had to go so hard

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<v Speaker 4>for it, but I've been born and raised in California.

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<v Speaker 1>Okay, Okay, West Coast Okay. So Sata, you have a

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<v Speaker 1>question for me?

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<v Speaker 2>What does that?

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<v Speaker 5>My question is when it comes to emergency savings, should

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<v Speaker 5>you be putting your emergency savings in a high deal

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<v Speaker 5>savings account or should you invest it into ETFs?

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<v Speaker 2>So, first of all, great question.

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<v Speaker 1>I'll say this, So one, emergency savings is a safety

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<v Speaker 1>net right, meaning that it is there to protect you

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<v Speaker 1>in case of loss of income or in case you

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<v Speaker 1>experience some sort of financial trauma or drama, to protect you.

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<v Speaker 1>The purpose of savings is not to make you money.

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<v Speaker 1>So I think that, like I want to like it's

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<v Speaker 1>almost like and some people be mad at me when

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<v Speaker 1>I talk about insurance, right, because you have like whole

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<v Speaker 1>life which I'm like boom right, Because the purpose of

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<v Speaker 1>insurance is not to make you money, is to protect

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<v Speaker 1>your assets, so emergency now, because we confuse emergency savings

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<v Speaker 1>with just money in general. Yes, we love our money

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<v Speaker 1>to make money, but emergency savings is literally a safety net.

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<v Speaker 1>So you don't want to put in a position not

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<v Speaker 1>to be there to protect you. Right, So, if you

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<v Speaker 1>put it in a high yield savings account like Allline

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<v Speaker 1>Only Bank or whatever, as long as I only only

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<v Speaker 1>bank is FDIC insured, meaning that you get your money

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<v Speaker 1>back up to like two fifty if you if the

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<v Speaker 1>bank should go under, then you can be pretty much

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<v Speaker 1>assured that when you need this safety net, the money

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<v Speaker 1>will be there. Now, the reason why we like high

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<v Speaker 1>yield savings is because although the perfect purpose of savings

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<v Speaker 1>is not to make you money, we don't want to

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<v Speaker 1>lose so much to the inflation. You know, right now

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<v Speaker 1>inflation is super on the high side, but back in

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<v Speaker 1>the day, inflation was like two or three percent. Emergency

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<v Speaker 1>savings accounts for yielding like you know, one or two percent,

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<v Speaker 1>so you were basically net net even it was there

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<v Speaker 1>ready for you in case.

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<v Speaker 2>Of and emergency. I want you to think about this,

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<v Speaker 2>like let's.

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<v Speaker 1>Just say you're on a on a like a flight

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<v Speaker 1>and the you know, like the air the mask comes down, right,

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<v Speaker 1>So the purpose of like the air mask coming down,

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<v Speaker 1>it's not for fashion, like girl, we're not looking turning looks,

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<v Speaker 1>is to save you in the in the case of

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<v Speaker 1>emergen Can you imagine like if you were like, but

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<v Speaker 1>it would be cute if it was like, you know,

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<v Speaker 1>giving a look or whatever. It's like, that's not the purpose.

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<v Speaker 1>So like, so that so the reason that's why so

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<v Speaker 1>I like ETFs. But the problem with putting your emergency savings.

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<v Speaker 1>So let me, I always forget what like ETF stands

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<v Speaker 1>for e TF, right, so at ETF, I always forget

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<v Speaker 1>the name. I just could I just call them ETFs

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<v Speaker 1>all the time?

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<v Speaker 2>Right me? ETF is an exchange traded fund.

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<v Speaker 1>So what that is is basically, it's a basket of investments.

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<v Speaker 1>Typically it could be stocks, bonds, and some other investments. Right,

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<v Speaker 1>It's a basket that is traded like a stock a

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<v Speaker 1>mutual fund. The difference is just it's a basket, but

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<v Speaker 1>it's not traded back and forth like a stock during

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<v Speaker 1>the day. You can only buy mutual funds after the

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<v Speaker 1>market is closed. You can buy it like you know,

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<v Speaker 1>you can purchase a mutual fund, but it's not traded

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<v Speaker 1>back and forth.

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<v Speaker 2>So an ETF is almost like.

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<v Speaker 1>A love child between a stock, which you can buy

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<v Speaker 1>and sell all day, but it's one singular piece of

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<v Speaker 1>a company and a mutual fund, which is a basket

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<v Speaker 1>of stocks.

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<v Speaker 2>You know, So at ETF is like.

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<v Speaker 1>The love child between those two things because it's also

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<v Speaker 1>a basket, but it could also be traded. Hold that

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<v Speaker 1>thought before we continue. Let's go to break because you know,

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<v Speaker 1>we got more to talk about and we're back. And

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<v Speaker 1>what I what I do like about ETFs too, is

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<v Speaker 1>that the more hands on someone is on the other

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<v Speaker 1>side to help you manage that money, the more you're.

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<v Speaker 2>Going to be charged. So i'll tell you what that means.

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<v Speaker 1>Meaning then with a mutual fund, there is typically a

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<v Speaker 1>person that is picking the fund, and that the so

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<v Speaker 1>mutual funds the expense ratio, meaning the cost to invest

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<v Speaker 1>is higher because there is somebody typically actively choosing the fund. Okay, right,

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<v Speaker 1>so you have to pay more money because that person's like, oh,

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<v Speaker 1>I need to get.

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<v Speaker 2>Paid to this.

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<v Speaker 1>ETFs are typically like electronically generated and so there is

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<v Speaker 1>still an expense ratio. There's still there's still a cost.

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<v Speaker 1>But because it's not this person picking it, the cost

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<v Speaker 1>is less. And with stocks, it's you picking it, it's

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<v Speaker 1>not a person behind the scenes. So oftentimes there is

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<v Speaker 1>no expense ratio, There is no no, no fee for

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<v Speaker 1>trading a stock except for, like, you know, whatever the

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<v Speaker 1>platform is charging you. You see, the further way you

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<v Speaker 1>get away from human intervention, the less and less money

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<v Speaker 1>you pay to actually play.

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<v Speaker 2>Does that make sense? It makes perfect sense, you know.

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<v Speaker 1>And so I just say all that to say that

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<v Speaker 1>I do want you to invest he but not with

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<v Speaker 1>your emergency fund, because now that you've worn your face

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<v Speaker 1>masks for fashion, the plane is going down. What you're

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<v Speaker 1>gonna breathe with? You know what I mean. So it's like,

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<v Speaker 1>so I, at the very least, what.

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<v Speaker 2>You could do? Do you like, do you have an

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<v Speaker 2>emergency fund? Do you have money set aside?

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<v Speaker 5>Now?

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<v Speaker 2>I sure do? Okay? Good.

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<v Speaker 1>So what you might consider tay is say, once I

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<v Speaker 1>get to three months, anything excessive over three months, I.

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<v Speaker 2>Can invest, okay, or.

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<v Speaker 1>You might say any depending on Now three months is

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<v Speaker 1>the bare minimum, depending on how quickly you can replace

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<v Speaker 1>your income if necessary. So like three months for a

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<v Speaker 1>nurse is more than enough, three months for a teacher

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<v Speaker 1>probably more than enough.

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<v Speaker 2>Three months.

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<v Speaker 1>For maybe an engineer, they might need six months. So

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<v Speaker 1>whatever your bare minimum is that you would need months

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<v Speaker 1>to replace your income. Once you get to that, then

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<v Speaker 1>anything outside of that, absolutely you ought to invest it.

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<v Speaker 2>Okay, that makes sense. Okay, it's hard sense, yes, right.

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<v Speaker 1>So I just want you to I want you to

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<v Speaker 1>visualize when you're like, oh man, this money's not making

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<v Speaker 1>money for you. I want you to visualize someone walking

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<v Speaker 1>down the street with their air masks from the airplane,

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<v Speaker 1>turning a look. Meanwhile, someone's up in the sky, like

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<v Speaker 1>I need my mask. Who took the mask from the plane?

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<v Speaker 1>You know they want the stunt and now we need it, Like,

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<v Speaker 1>you know, you don't want to take that money that

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<v Speaker 1>you need. The purpose of emergency savings is protective. There's

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<v Speaker 1>some money that's meant to earn, there's some money that's

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<v Speaker 1>meant to grow, and there's some money that's.

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<v Speaker 2>Meant to protect. And that's protective money. Okay, protecting money, Yeah,

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<v Speaker 2>that's protecting money.

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<v Speaker 1>Is there to protect you in the case of emergency

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<v Speaker 1>at least three months, more and more if you feel

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<v Speaker 1>more comfortable.

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<v Speaker 2>But I will say it is possible to save too much.

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<v Speaker 1>I think that's what you're thinking about, because there might

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<v Speaker 1>be people who have five years worth to save.

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<v Speaker 2>I'm just making that up. That's too much. That's too much.

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<v Speaker 1>You know, once you get to whatever that thresholders, you're

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<v Speaker 1>three months or six months. Anything above that, you're right

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<v Speaker 1>that money is being wasted.

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<v Speaker 2>And I have been there. I'm sorry.

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<v Speaker 4>I just think like I have to switch my mind

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<v Speaker 4>from like you said, it's not meant.

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<v Speaker 2>To make you money, it's meant to protect you. I

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<v Speaker 2>have to switch my mind to that.

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<v Speaker 1>You know, it's like your warm winter coat versus your

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<v Speaker 1>cute winter coat.

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<v Speaker 2>Right, you're like, it's really gold out.

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<v Speaker 1>Well, you wouldn't know because you're in California or whatever.

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<v Speaker 1>It does get a little cold, right, But don't you

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<v Speaker 1>have some things where you're like, this is my big, old,

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<v Speaker 1>ignorant coat, where it's not about cuteness, it's just because

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<v Speaker 1>it's cold out.

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<v Speaker 2>And then I have like something else.

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<v Speaker 1>It's like it don't really keep me warm, but it's

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<v Speaker 1>really so I could be cute when I go out.

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<v Speaker 4>Yes, like I got the jacket I would buy versus

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<v Speaker 4>the jacket my mama brought me exactly.

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<v Speaker 1>So I want you to be like, this money is

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<v Speaker 1>saving that's my mama bought jacket.

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<v Speaker 2>Right, It's like, all right, this is.

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<v Speaker 1>My responsible you know, and anything above that then I

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<v Speaker 1>can start looking at jackets that I'm purchasing for myself.

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<v Speaker 2>Okay, So just like you know, yeah, that's really good. Okay, good?

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<v Speaker 2>Well was it helpful?

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<v Speaker 5>Yeah?

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<v Speaker 2>It was so much like I'm wanted to change my

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<v Speaker 2>whole game plan. So thank you. Good, I appreciate it.

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<v Speaker 5>Good.

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<v Speaker 2>Now you're welcome.

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<v Speaker 3>I talked to you though, because oh my god, I

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<v Speaker 3>cannot wait.

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<v Speaker 2>I will tell you mom, what's your mom?

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<v Speaker 1>You bet?

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<v Speaker 2>What's her name? Help woe.

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<v Speaker 1>Over here to ask you a good, smart and relevant

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<v Speaker 1>financial question.

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<v Speaker 2>You did a good job to Sevet. Oh she'd let

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<v Speaker 2>me hear that.

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<v Speaker 5>So thank you so much.

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<v Speaker 2>I appreciated so much.

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<v Speaker 3>Here we go, bye bye, Hey ba fan, we could

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<v Speaker 3>not do this show without your support or the support

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<v Speaker 3>of our team behind the scenes. The Brown Emission Podcast

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<v Speaker 3>is produced by Cumulus Podcast Network. It's edited by the

0:09:43.559 --> 0:09:48.160
<v Speaker 3>wonderful Emani Crosby and produced by Tanya Bustos. Dennis Stimplinsky

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<v Speaker 3>is our in house tech guru, and I am Bandy

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<v Speaker 3>Woodrid Santos your co host, and I will see y'all

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<v Speaker 3>next week,