Dr. Patrick Payne of the Arizona State University W. P. Carey School of Business joins us to explain why managing your money is anything but cookie cutter. As he puts it, the hard part of personal finance isn’t the finance, it’s the personal. In this conversation, he breaks down how your financial priorities shift as you age, offers practical advice for new graduates landing that first job, and reframes early career moves as investments rather than final destinations.
Transcript:
Jeffrey Snyder, Broadcast Retirement Network
Well joining me now is Dr. Patrick Payne of the Arizona State University Carey School of Business. Dr. Payne, it’s great to see you. Thanks for joining us this morning.
Patrick Payne of the Arizona State University W. P. Carey School of Business
Yeah, thanks for having me, Jeff.
Jeffrey Snyder, Broadcast Retirement Network
I’m really excited to talk to you because money obviously is an important part of our society. You were part of an interview at Arizona State University that I read. I thought it was really important.
So thanks again for coming on. Let me start off with a basic question. Is managing your money cookie cutter?
I mean, is it simple? Is it just figure out the percentage you need to save, invest it, and everything else will take care of itself?
Patrick Payne of the Arizona State University W. P. Carey School of Business
Absolutely nothing could be less cookie cutter than personal finance. I’m always telling my students the hard part of personal finance isn’t the finance part. It’s the personal part.
I can do the math. The computer can do the math. The web app can do the math for you.
Like sort of the finance, math, background stuff, that’s the easy part. The personal, how does this work for me? Does this make my life better?
Does this take me in a direction? Do I want to go? How do I discipline myself and make sure I’m not going way out on my budget?
Am I buying the right things for me? That’s absolutely not cookie cutter in any way. And I think educators, public figures, anyone who kind of promotes a cookie cutter approach is doing a disservice to the public in many ways.
I understand people want a single answer. They want, tell me A, B, and C and everything will be fine. I understand that.
I want that, but it just is not the case with finances. Everything has to be applied personally and integrated in your own way. And that makes it very challenging.
Jeffrey Snyder, Broadcast Retirement Network
And I would tend to agree with you. It’s not as easy as one, two, three, put money in a cookie jar and it’s going to be a million dollars at the end of that. It takes a lot of machination and coaxing.
So with that being said, and I’m in complete agreement with you, does your approach to money have to change as you age? Because clearly you’re working in a very prestigious university, a very prestigious business school. You have very thoughtful students.
They’re of a certain age probably, but as we get older, do our priorities change and therefore does our management of money have to change?
Patrick Payne of the Arizona State University W. P. Carey School of Business
Oh, absolutely. You’re going to change your priorities. You’re going to change your goals.
You’re going to change interests even. Your circumstances are going to change. What you need is going to change.
So every part of your life is going to fluctuate and change. And so it’s important that you update and modify your approach as you move through your life, both to accommodate changes in your life and your situation, as well as to just, as you approach retirement, that’s an important inflection point in your finances. And so you need to be, as you approach that point in particular, it’s time to start paying attention to some things that maybe were deep in the background for a long time.
It’s time to start bringing forward and paying attention to them.
Jeffrey Snyder, Broadcast Retirement Network
You may teach students of all ages because people go to school for all different reasons at all different times. But let me ask you about specific categories of people, if I may. And again, we’re generalizing here.
It doesn’t always apply. People are individuals and therefore personalization matters. But let’s talk about that first job.
And many of your students may be coming out of school, getting that first job. What are some of the things they should be thinking about? That’s very overwhelming if you’ve been in the college life for some time.
So what should they be prioritizing maybe that they’re not?
Patrick Payne of the Arizona State University W. P. Carey School of Business
I think a lot of times they’re looking at that first job as the payoff, the reward for their investment in their education. Hopefully they’re thinking about the reward and the payoff from their education. But they’re thinking of it as the end, as, all right, I need to pick the right job in the right field, doing the right thing for the right people, because this is going to set the trajectory of my life.
And in a certain way, that’s kind of true. In a certain way, it’s too, it’s just a little dramatic. Like you can change jobs, you can change paths, you can change entire career trajectories, entire industries when you’re 50 if you want, right?
But when you’re young. Case in point. Yeah.
Jeffrey Snyder, Broadcast Retirement Network
Sorry to interrupt, go ahead.
Patrick Payne of the Arizona State University W. P. Carey School of Business
But so I always encourage students to keep two things in mind when they’re looking at that first job. The first is to think of it as an investment. It’s not the reward, it’s a continuation of investing in their skills.
And so when you’re evaluating a job, it’s not just salary and location. Those things are obviously important. Those things matter.
But even more important that gets overlooked is what skills can I learn here? What types of people will I meet? How can this job lead me to the next job that will be better?
And the next job after that, and the next job? So view it as a stepping stone rather than a final destination. And then the second thing I like to encourage them to do is to just get going.
Sometimes young people, they get paralyzed with fear that they’re going to make a bad choice. I felt that way when I was their age. I’m like, oh, is this a bad choice?
Is this a bad job? Should I major in this? You know, you’re making these big decisions for your whole life.
And sometimes it paralyzes them into not making a choice at all, not trying. It gets overwhelming. And so I like to use the analogy of a car.
You can’t steer a car that’s parked. So if you find a job and it seems like it’s going to be okay, it looks good, go ahead and just take it and get going down the road. And if it winds up not being the perfect job or not being great, or it winds up being like, I hate this and everything about it, that’s fine.
You can steer as long as you’re moving. And a lot of times you can be like, hey, now I know what I don’t want. And that clarity is valuable.
Even when you roll to the next job, you’re applying for a second job out of college. And they’re like, well, your first job is very different than this one. What’s going on?
You say, I learned what I didn’t want. And I think you have what I do want. And that’s valuable too.
Jeffrey Snyder, Broadcast Retirement Network
Uh, it sounds like maybe people need to reset their expectations. Students may have to reset their expectations. You don’t have to stay at home, run to use a baseball analogy.
Um, at that first at bat, you just got to keep singles, doubles, triples, bumps, whatever it takes to get on base. It sounds like, um, maybe is a, is a good analogy. Um, I want to ask you about, as we progress through the timeline, but I did have a thought that occurred to me.
So much has been talked about in terms of financial literacy. I know part of what you do is educate students about these, I call them basic skills. Are you finding students have some of the basic mathematical and financial skills that they will need to be successful?
Or are they coming in as really blank slates? Maybe didn’t get some of this in home ec like I did, or, or, you know, in, in, in school or high school and they’re, and they’re basically a blank slate.
Patrick Payne of the Arizona State University W. P. Carey School of Business
Um, overall I would say blank slate. Um, there has been, uh, I think gradual improvement that I’ve seen over the course of, um, you know, 10 years of teaching. I actually think they are coming in with better prepared on average, uh, with a better background.
I think there’s a growing awareness among kids at younger ages of the importance of these topics. Um, that said, when it’s hard to get a high school or to, to recognize the importance of homeowners insurance estate planning, you know, like I was the same way. I can’t blame them at all.
Right. I was exactly the same. Um, if you told me I would be make a career out in this field, I would have just laughed at you in high school.
Um, but here I am. Right. And I love it.
So, um, yeah, blank slate, I would say like the math skills are, are not, not any better or worse, I think, than they’ve been in the past and just kids are young and they’ve always been young. That’s why they’re kids. Um, and so I don’t know that it’s necessarily, uh, a bad thing per se, I would be better if, if they were more prepared, but, um, I think that’s why it’s just that our job as instructors and universities, as, as parents, family, friends, just as the adults, um, to provide that education and, and to teach them as they mature and become more capable of appreciating it.
Uh, I had my, my first job, my, um, my media manager, um, took like three hours every Monday and pulled the team of us together. And there was like six of us and we’re all fresh out of college and he just taught. And it was a, it was a job at a bank and he talked about banking and he talked about finance and he talked about economics and he just, he just shared like life wisdom and experience.
And I really appreciated that. And it did a lot of good for me. So if you’re frustrated and you’re like, well, I don’t teach at a university.
How am I supposed to help you? You can just, just be there for, for the youth who need you.
Jeffrey Snyder, Broadcast Retirement Network
Yeah. I think that’s a very important perspective. And, and, you know, life is a great teacher and you don’t come out of high school, as to your point, you don’t come out knowing everything.
And you may think, you know, everything because we all think we’re at that age that we’re infallible. We know everything, right. We’re better than the generation before, but the reality is, and I want to get your reaction to this, it’s life’s circumstances put you in the situation to learn something.
And that’s the benefit that I had now in my mid fifties, you’ve had as an instructor and other people that have come before us, they, they’ve learned from the experience that they’ve been put in.
Patrick Payne of the Arizona State University W. P. Carey School of Business
Yeah. Yeah, absolutely. Life is the great teacher.
And in fact, one of the, one of the areas I try to, or I feel is important when I’m teaching financial literacy and basics to like an intro level class, as I try to view it as less as like, I’m trying to teach them everything they need to know. Cause if I try to cram everything they need to know into a class, they’re just going to shut down. It’s a fire hose.
It’s too much. It’s just can’t do it. Right.
So I try to focus on big picture, big ticket things so that when they make mistakes, they’re the small mistakes rather than the big mistakes. And so I try to steer them around. This is the big mistake.
This is the big, here’s like the big, the big rocks in the water, they’re going to sink your ship. If you, if you run into some problems and you will, you’re going to learn from hard experience. All of us have, and all of us do try to make it the small ones rather than try to cram everything.
They might need to know everything that is useful because it’s just too much of it.
Jeffrey Snyder, Broadcast Retirement Network
Well, I mean, it’s like drinking from a fire hose. And again, going back to our early part of our conversation, experience is the great teacher. And when you go to buy the house, that’s when you need to figure out an adjustable rate mortgage versus this fixed rate, all the, all the, or do you buy a new house or a house, you know, right.
Those are, those are things that kind of pop up. I did have a question for you about the classes that you teach. So would you mind just sharing maybe the class size and then also do the tools of today, you know, the technology, because I grew up with typewriters, do they help you express and get through to students in a more, much more beneficial way than maybe before we had some of these technologies?
Patrick Payne of the Arizona State University W. P. Carey School of Business
Sure. Well, ASU is a large school. I think it’s the largest in the country by enrollment right now.
And so we do have relatively large class sizes compared to maybe other programs in a, in a gen ed for me, like a gen ed financial literacy class, I might have 180 to 200 students in something more like an upper division for the students who want to become financial professionals. They’re majoring in our financial planning program here. Might have 50 or 60 in a class like that.
And it gets to be where the technology becomes essential. We’re really trying to embrace the capabilities, for example, that AI give us to provide personalized instruction in a way that you just, you just couldn’t before. So we’re, you know, the WP Carey College of Business is, you know, providing training for faculty on how to create chatbots based on a specific set of knowledge or facts.
So you can control, you know, minimal hallucinations, get the correct information to the students in a way that maybe they could have more personalized. On the flip side, there’s, there’s also challenges, you know, AI in education, students can turn their brains off, just let the AI do it for them. So we’re, we’re working on things like making sure that our assessments are based on something that you have to do, like in person, like an in-person exam, or something proctored.
So we’ve had to adapt, and there’s advantages and disadvantages to the technology. But overall, it’s been, I think, a positive impact on our ability to provide the university’s goal to provide a quality education to a large audience at the same time, which usually traditional wisdom says you can’t do. If you want to be good, you have to be small.
If you want to be big, you have to be bad. And ASU as an institution rejects that. And it’s one of the things I love about this school, is that we believe you can be good, and you can be big, that everyone can get a really good education.
Jeffrey Snyder, Broadcast Retirement Network
Yeah, well, well said. I do. My last question is, did they still use Scantrons, Doctor?
The Scrantron, you know, the Scantron sheets with the number two pencils?
Patrick Payne of the Arizona State University W. P. Carey School of Business
Um, most don’t, but I think we’re starting to pivot back.
Jeffrey Snyder, Broadcast Retirement Network
Interesting. What’s old is new, and what’s new is old.
Patrick Payne of the Arizona State University W. P. Carey School of Business
Yeah, yeah. In fact, I’m using Scantrons again for the first time in like six years, in one of my tests, in one of my classes.
Jeffrey Snyder, Broadcast Retirement Network
Did the kids know how to sharpen pencils? I’m just kidding. Dr. Patrick Payne, we’re going to have to leave it there. Thanks so much for joining us. Great insight, and we look forward to having you back on the program again very soon.
Patrick Payne of the Arizona State University W. P. Carey School of Business
Yeah, thanks for having me.
Jeffrey Snyder, Broadcast Retirement Network
Thanks, Patrick.
