Farnoosh Torabi has spent years working in finance. She’s written about topics ranging from saving money on groceries to investing your money more wisely. She’s also the host of the award-winning podcast, “So Money,” where she interviews successful people about the things that helped them find success in life. If you’re a young professional who has ever had questions about money, check out Torabi’s advice.
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Top Financial Advice From Farnoosh Torabi
A recurring theme in Farnoosh Torabi’s advice is to make your finances about you. Understand the way you operate and what your personal goals are. Then you can create a financial plan to help you reach your goals. She also recommends thinking about the things that are important to you. You shouldn’t cut your monthly massages out of your life if they’re an important way for you to unwind and refresh. Though if you know that you can de-stress just as much by going on a free hike, then eliminating the massage might be a perfect way to save money.
Torabi promotes frugality. Prevent overspending by buying just the things that you need. Then cut back on everything else. A good way to cut back is by tracking your spending. It’s difficult to know where you can save money if you don’t actually know how where your money is going. Another way to stay frugal is with a shopping list. Supermarkets are notorious for getting people to spend more than they intended. Go with a list in hand so that you can get only what you need.
Over her career, Torabi has looked into the psychology behind why people handle their money the way they do. This has led to a number of psychological hacks to help people cut back and save money. One hack from her book, “Psych Yourself Rich: Get the Mindset and Discipline You Need to Build Your Financial Life,” is to create a personal rule of thumb.
For example, people who are trying to improve their diet might hold themselves to the rule of not eating anything after 10 p.m. Someone trying to improve their savings could create a similar rule. If you buy a lot of clothes, maybe a good rule of thumb is not spending more than $75 on a pair of jeans. That way you give yourself a limit without completely eliminating something you care about.
Another psychological hack is to use cash. It sounds simple but it’s actually popular and effective advice. When you use a credit or debit card to buy something, it’s easy not to realize how much you’re spending. There is no difference in the way you buy something that costs $5 or something that costs $105. All you do is swipe and sign. Cash on the other hand will require you to physically hand over the money. Handing a $50 bill to the cashier is an immediate reminder that you’re decreasing your funds by $50.
A great way to save more money is also by having more money to begin with. Torabi recommends always negotiating your salary. This advice is especially important for those who are just starting in their career. The salary of an entry-level position is usually low to begin with so do yourself a favor by getting as much as you can. Employers usually have more leeway in your salary than they will let on. However, they won’t give you any more money unless you ask. Some people avoid asking for more money because it seems frightening or confrontational. Don’t overthink it. Just do it. Asking for more than the initial offer could also increase your standing in their eyes by showing them that you respect yourself enough to ask for what you believe you are worth.
A Brief Bio of Farnoosh Torabi
Farnoosh Torabi was born in 1980. She attended Pennsylvania State University and earned a B.S. studying finance and international business. She went on to get her Master’s degree in journalism from Columbia University.
After graduating, she had to find ways to live in New York, where the income needed to pay rent is the second-highest in the country. There was also the issue of paying off her $30,000 of debt. As Torabi says on her website, those years included a lot of borrowed clothes, canned tuna and $5 foot-long sandwiches from Subway.
Her time in New York helped her realize that there was something missing. There was no way for young people to learn about money and financial responsibility in a straight-forward and relatable way. Torabi tried to fill this hole with her work. Her career began with researching and reporting on ways to save money. Then she worked for NY1 News as a business producer and reporter. She also served as a financial correspondent on Jim Cramer’s TheStreet.com TV.
Finally, she decided to do more work on her own. She published her first book in 2008. It covered advice for those in their 20s who were just starting to look seriously at their money. In 2009, Torabi hosted SOAPnet’s “The Bank of Mom and Dad,” where she coached young women struggling with debt. She spoke to audiences around the country and appeared on a number of TV and news programs.
After becoming a mother, she wanted a way to maintain a good work-life balance. This spawned the idea for a podcast that she would host from home. Through her intimate conversations with highly accomplished individuals, she has helped to teach people about taking control of their finances and their lives.
Financial Focus and Philosophy
Farnoosh Torabi advises people of all ages, but her target audience is young professionals. As she climbed her way out of debt in her 20s, she decided that she needed to help young people understand their money. She has worked on multiple projects aimed at helping young women as well.
Regardless of the individual project, Torabi’s goal is to provide relatable and realistic advice. She wants to help people learn what they need to know about their finances in order to find success in their lives. She does this by covering the issues that she confronts in her daily life. As a 22-year-old, saving a dollar here and there was important. When she became a mother, finding a manageable work-life balance was vital. By drawing on her own life, she helps others who experience the same challenges.
Where You Can Find Farnoosh Torabi
The best way to learn more is to visit Farnoosh Torabi’s website. There you can find more about Torabi’s life, her podcast and all her other projects. You can also follow her daily posts on Twitter at @Farnoosh.
Current Projects
Farnoosh Torabi’s lastest book, “When She Makes More: 10 Rules for Breadwinning Women,” was published in 2014. It helps professional women overcome the stigma and psychological challenges that come with being the breadwinner in their relationships.
You can also listen to Torabi multiple times a week on her podcast, “So Money.” The podcast includes interviews with other successful individuals and advice on how to overcome common financial problems.
Fans of her podcast might also enjoy the CNBC show “Follow the Leader.” Torabi hosts and interviews successful leaders on how they’ve gotten where they are today.
The Takeaway
Farnoosh Torabi is a leading voice on financial empowerment for young professionals. Her advice is simple but relatable because she draws from her own experiences. She also hosts one of the most highly rated financial podcasts. Her writing has been featured in successful publications like “O, the Oprah Magazine.” She also talks around the country in person and on TV.
If you are a young professional trying to curb your spending, Torabi’s advice might be just what you need. Working mothers should also check out her advice on finding the time to raise your child while pursuing your career goals.
Tips to Build Retirement Savings While You’re Young
- Working with a financial advisor can help you grow your retirement savings while you’re still young. Finding the right financial advisor that fits your needs doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in your area in 5 minutes. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.
- Farnoosh Torabi believes that nobody cares about your money more than you. No one will go out of their way to help you earn more or to handle your money better. Remember this as you start to think about retirement savings, because it also means no one will hold you accountable for your savings. The best way to start is by making it a priority to save for retirement. That sounds simple, but a big reason that people don’t save for retirement is because it isn’t a priority for them. Tell yourself that no matter what happens, you will put as much toward retirement as you can. If something comes up and you put away less than you planned this month, that’s OK. Get back on track next month.
- Invest! One thing that Torabi emphasizes to young people is that investing is vital for building wealth. At the same time, you don’t need to be wealthy to start investing. Many people avoid investing because they don’t think they have enough. You can invest even with just a couple hundred dollars. Start a retirement account, like a Roth IRA, today. Choose to invest in a diverse set of low-cost ETFs and index funds. That will ensure your investments are diversified. Many people try to pick stocks that they think will outperform the market. Unfortunately, this rarely works unless you dedicate all your time to researching and trading. The last thing you want is to lose allyour retirement savings because a single stock does poorly. Index funds and ETFs mirror the whole market by investing in a large number of stocks. That makes them safe even when a few stocks aren’t doing well.
Photo credit: ©Flickr/Penn State, Farnoosh.TV, ©Flickr/Penn State