Finding Your Best Financial Self with Farnoosh Torabi

While talking about money has never been taboo for Farnoosh Torabi , she’s the first to admit she’s made her fair share of missteps.

“I’ve made mistakes for sure,” admitted Torabi, the host of podcast So Money , during her live chat with SoFi’s Lauren Anastasio. Torabi recalled an occasion in college when she overdrew several times on a debit card, wracking up significant overdraft fees when she wasn’t watching the account balance.

Instead of panicking, Torabi took action. She knew she could sort it out, so she called the bank, explained her issue and asked them to forgive some of the fees. All it took was a call, and she had saved a significant amount in penalties.

It was a relief in the short run, but it also shed a light on the work she’d build her career on; “I learned you can always look for the solution, you can always talk to someone to work things out.”

With over fifteen years of experience in the finance space, Torabi’s dedicated her career to teaching financial literacy and empowerment, publishing multiple books in addition to her popular podcast.

When first starting out, “I was in the trenches with my readers,” Torabi explained, making very little straight out of college in New York City. She was learning to manage her money in real-time and helped her audience work through financial problems.

As she hit milestones, she worked through them with her audience, publishing “When She Makes More ,” in 2014, exploring the dynamics of when the woman brings home the biggest paycheck. “It helped me wrap my brain and heart around the issue,” Torabi explained, as making more in the relationship applies directly to her personal experience.

With So Money, she’s been able to elevate her advice, calling it “a little more sophisticated, 301 level, if you will.” She invites followers to reach out on social media with any questions they have to be answered in her #AskFarnoosh segments.

Torabi’s appearance rounded out SoFi’s financial literacy series, where she touched on discovering your best financial self, turning to the right resources, and how to collect all the facts to make your best money moves.

What Does Your Best Financial Self Look Like?

For Torabi, being the best financial version of herself means having control over her money, and how she spends it, “No one else can choose what you do with your money,” she said.

Getting in the driver’s seat when it comes to finances, doesn’t start with thinking about money, advised Torabi, “sometimes people get overwhelmed with the numbers when it comes to money.”

First, a person should think about the goals they want to achieve. What do they want to achieve in the short, medium, and long term? It could be buying a home, paying off loans, starting a business, or even retiring early—people should steer towards whatever drives them.

Now, money comes into play. “Plan your finances through the lens of your goals,” Torabi advised. How monthly savings and spending get a person closer to their goal?

As a person embarks on their financial journey, Torabi urges them to think about how it feels, and reflecting on that, “there were years when I managed to do X and it made me feel Y,” she said.

For most of us, the positive feelings that people associate with saving towards their goals are more likely to drive them than the number in a spreadsheet. “If you just obsess about money, you can get lost in the weeds and lose that sense of motivation,” explained Torabi.

It might feel counterintuitive, but gaining control of finances is much more about feelings towards a bottom line, than the amount in the bottom line.

When it Comes to Investing, Focus on Facts, Not Feelings

Now, this can feel counterintuitive based on the idea above, but aspiring budgeters need to remove feelings from the equation when it comes to decisions in investing, explained Torabi.

Several attendees had questions around the changing of their financial strategy in the COVID-19 climate. With uncertainty about the future, should they change their investment strategy?

Torabi felt the same kind of uncertainty during the Great Recession but says, “you shouldn’t change your investing behavior based on feelings, you should do it based on concrete facts.”

Many investors are decades away from retirement, and while the investments will fluctuate over time as the market changes, the knee-jerk reaction to pull money out might mean more loss in the long term.

With apps and push notifications constantly telling investors how much the market is up or down, the pressure to make adjustments can feel very real. “It used to be my job to closely follow the market,” Torabi recalled, “and I was always in the doctor’s office with stomach aches.”

To avoid the aches and pains, investors may choose to resist the urge to constantly check their retirement accounts. Consider deleting investment apps from the phone, or make it a goal to only check them quarterly, advised Torabi.

It only takes a quick look at the market in recent months to prove the point, reasoned Torabi. While some might have felt the urge to pull out funds when the markets plummeted in March, looking at the numbers now, “you’d be proud of yourself if you stuck with the market,” Torabi said.

However, because of the economic impacts of COVID-19, there will be changes to people’s investment strategies. If a person is furloughed or lost their job, they might choose to bolster their emergency savings instead of continuing to invest, explained Torabi.

“If you can’t afford to invest right now because you lost your job, we get it,” Torabi reasoned, “but if you can still afford to do so, there’s no excuse not to.” It’s best to leave feelings out of the market, avoiding panicked money moves that could set an investor back.

“I might not have blind faith in the markets, but I have blind faith in humans,” Torabi said. Innovation and new ideas come out of hardship, and investors have a unique opportunity to have a stake in that journey.

Stay in the Know, Turn to Resources

Torabi left viewers with her final thoughts on how to navigate these times, “information is so vital to your success right now,” and staying in the know is more important than ever.

Assistance is coming from the government and employers, and the offerings are changing day to day as we adjust to life with COVID-19.

Paying attention to updates can, well, pay. Federal student loan payments have been halted, small businesses can apply for federal loans, and unemployment benefits have increased.

Local and federal government organizations are announcing subsidies and grants, as workplaces provide resources to help employees navigate challenging financial times.
When people don’t pay attention, they could miss out on stimulus payments, assistance for small businesses, or more.

“Information is so vital to your success right now,” Torabi explained, there’s no such thing as too many resources when it comes to financial health.

That’s why SoFi offers complimentary financial planning to its members. Set up an appointment to speak with a financial planner, through the SoFi app or online, about goals, challenges, and obstacles in the path to financial freedom.

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