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The Life of And podcast is for high-achieving women and working parents who are ready to stop living a life of “have to” and start designing a life they actually want. It’s a space where we talk honestly about the things we’re often afraid to admit — even to ourselves. The exhaustion. The ambition. The loneliness. The joy. The tension of wanting more without losing yourself in the process.
If you’re in the thick of it — feeling stretched, tired, hopeful, driven — this is your invitation to take a breath, get real, and find your way back to your own Life of And.
[00:00:00] Nicole Lorch: To me, it's about financial stability and it's about the idea that someday I want to not have to work anymore. What am I building for my family and for myself so that there is a level of stability and security? We hear about things like generational wealth and people who sell companies and catapult themselves into much, much higher stratospheres. But I think for most of us, it's really just about stability and security.
[00:00:30] Tiffany Sauder: I'm Tiffany Sauder, entrepreneur, wife, mom to four girls, and a woman figuring it out just like you. Come on, let's go build your Life Of And. Welcome back to another episode of Life Of And. I'm your host, Tiffany Sauder, and today this is not a finance 101 conversation. We are really going to be digging more into the deep end of how do we as women understand different constructs about money and the way that we can create wealth for ourselves, for our families, and so we can be generous to our communities. So I am joined on the microphone again with Nicole Lorch, president of First Internet Bank. And when we started this partnership, it was over this idea of if we can get women talking about money more, we can get women learning more about money, we can get women doing more with money.
[00:01:23] Tiffany Sauder: And so that really is what the backdrop of this conversation is about. It is not going to give you everything you need to know to go and create a life of wealth, but what I hope it does is it gives you a starting point to begin to have conversations with yourself, with your partner, with your banker, with your community about how do I have better money sense so that we can create wealth and opportunity for ourselves and those around us. So let's jump into it. Nicole, welcome back to the studio.
[00:01:52] Nicole Lorch: Thanks for having me.
[00:01:52] Tiffany Sauder: This is a midsummer recording and we're all feeling some midsummer vibes.
[00:01:58] Nicole Lorch: It is hot out there.
[00:01:59] Tiffany Sauder: Yes, totally. We've been joking. I'm in the studio today with a button down with feathers on my sleeves. It's a Monday morning. We're not totally sure about what that means about how I've started the week, but here we are, feathers and all. Okay. I want to start with this backdrop of where we've began to create this vocabulary around income statement, thinking and behavior in our finances and balance sheet thinking in our finances and behavior. And so this really is a balance sheet conversation.
[00:02:32] Nicole Lorch: Okay.
[00:02:32] Tiffany Sauder: But before we dive into that, can you just give our listeners a refresher or if this is the first time you've heard Nicole and I on the mic, really what we mean by that vocabulary? Oh,
[00:02:42] Nicole Lorch: Absolutely. And I hope words like balance sheet and income statement don't cause you to tune out because it's not as scary or as overwhelming as it may sound. There's this idea I think so many of us talk about what we make. We talk about what our salary might be and we think in terms of budgeting and what we can afford and what we can't afford. And so all of that to me is income statement thinking. In finance, you have income statement and you have balance sheet. Those are the big two. Income statement is really how much do you bring in and how much do you put out into the world? So how much revenue do you have? What are your expenses? And then at the end of that, that's what's left. And
[00:03:30] Nicole Lorch: I think that's how a lot of people think. And many of us, because we're trying so hard just to keep up, that's as much as we can do is try to put out less than we take in. That's the way we think. And as people start to think about, you used the word earlier, wealth, that has nothing to do with income statement. That is balance sheet thinking. So balance sheet is what you have. And the two go hand in hand because when you get down to the end of that income statement, you think about what you have brought in, what you have put out and what's left, that then feeds your balance sheet. So I won't get into too many technical terms like assets and liabilities and put everybody to sleep. But when you think about wealth, that is truly what you have. And wealth is what you're striving for at the end of it.
[00:04:23] Nicole Lorch: We all think of this number that we want to have when we retire perhaps. But as you go, you're accumulating wealth. And I think that's something worth checking in on from time to time because it can quietly amass or it can erode if you're not paying attention to it. So that's why I think it's so important because at the end of the day, what we really want to be doing is building toward wealth and we get so caught up in the day-to-day, the earning and the spending that sometimes we think about what we're growing behind the scenes.
[00:04:59] Tiffany Sauder: Totally. Can I ask you this question? I think even this word wealth can be like a cringey, dirty word to say, is that a prideful thing to want to be wealthy? Is that a greedy thing to want to be wealthy? Or what is behind even the desire for wealth? Have you thought about that for yourself when you think about your number or why wealth is important to you? Because the why does drive you even when you need to make tighter income statement decisions like I'm tightening up our budgets for this reason. Or sometimes making an investment means you have to say no for a period of time. So what's your personal why behind wealth? And I can share mine as well if you' thought through that what that looks like for you.
[00:05:47] Nicole Lorch: Well, yeah. I mean, the word wealth might sound like someone named Muffy who goes to the country club, right? And that may not be your vibe. To me, it's about financial stability and it's about the idea that someday I want to not have to work anymore. And so what am I building for my family and for myself so that there is a level of stability and security? We hear about things like generational wealth and people who sell companies and catapult themselves into much, much higher stratospheres. But I think for most of it, most of us, it's really just about stability and security.
[00:06:30] Tiffany Sauder: I think that's exactly right. I think for me, it's also about the generosity of being able to say yes. Something as simple as I have this young girl that has lived with us and we have a great relationship with and she called me, she's like, "Can you host my bridal shower?" And I'm like, "Yes." Just the ability to say yes to things and be generous to people for me is also a real reason behind the desire to have abundance of I'm not just trying to make ends meet, but I'm able to sort of have this layer of generosity to the people around me gives me a lot of energy to want to keep figuring out how to do it. Absolutely.
[00:07:13] Nicole Lorch: Oh, I love those words, generosity and abundance. Every time I listen to one of your podcasts, and I think your audience, it's probably the same. It's this other layer of thinking that you bring to things. And so those are such positive easiest.
[00:07:25] Tiffany Sauder: Well, I think it's not about I want more stuff. And I think when we say wealth, we can. That was such a great caricature of sort of Muffy that goes at the country club that you want more time to be able to tan your legs or get laser treatments. And those aren't bad things, but that underlying is not my core reason. And I think as you even begin to practice or think about this pursuit of different tools in your financial toolbox, I'm talking to the audience now, thinking about why it matters to you is a really meaningful starting point I think in all of this.
[00:08:04] Nicole Lorch: Of course.
[00:08:05] Tiffany Sauder: In a previous episode, and Sam, you can put the show the link to it. I don't remember the name of it, but I shared from our family some different choices we made in our 20s and 30s to put us into a different place now that we're in our mid to late 40s. I just turned 46, she's in denial, mid to late 40s, that we're in a different place because we made different choices in our 20s and 30s. So you can go listen to that episode if you haven't. But one of the things that is so acute to me as I'm in this midlife sort of season of my career is if you make the exact same choices as everyone around you and expect to be at a different place, that is just not how it works. And so at some point you have to decide you're going to make different choices than the tribe, than the crowd, than maybe your family, than maybe some of your friends to put yourself in a position to potentially have a different outcome.
[00:09:00] Tiffany Sauder: But there's oftentimes more risk in that different outcome. And so I'm curious to know in your family, maybe in your own career journey, Nicole, or the choices you and your husband have made, what different has looked like for you guys to sort of chart a different path for your family?
[00:09:19] Nicole Lorch: Oh my goodness. So many decisions. And it probably goes back to really my first job getting out of school and having that first job. I started saving in my 401k right away. And I would say to anyone who is listening, please, please, the sooner you start, the better it will be. The market is volatile. There will be ups and downs, but studies have shown time and time again and the math works. The sooner you start to save, that can compound. And so it's hard. I made $22,000 a year when I first graduated from college and it was hard to find the money or make the choices, the trade-offs, the things that I gave up in order to start saving. But
[00:10:06] Nicole Lorch: With a company match, that's additional money that your company's going to give you in many cases. And so I'm so glad I started early. So I mean, that's an easy answer, I guess, not easy to execute. But over time then that has changed. And it's interesting to me because when I started, you talked about keeping up with the Joneses and that was maybe the people who lived on the left or the right or the apartment above or below you. But now with social media, we see all of the different ways that people live their lives and there are people who make their living just advertising products. And you see these travel blogs and you see these handbag blogs and you see normal vloggers, I guess, or influencers and they're showing these things and all these ways to spend more. And what we don't know is what do they really have behind the scenes?
[00:10:59] Nicole Lorch: So that for me has always been kind of a touchpoint on what am I trying to build toward? And part of that helps to take a look at it on a quarterly basis. I'm sure we'll get into that, but I would say as we've gotten on in years and our lives have changed, we welcome the child. There have been different choices that we've had to make. And more recently, there are a couple of changes that I think are surprising. They're probably surprising to my family. They're surprising to people around me because my husband made the deliberate choice to step away from his job. And that was five years ago.
[00:11:36] Nicole Lorch: And that had to do with quality of life for us. He was a teacher. We though of it as May and December were the worst months for our whole family because not only was my daughter going through the end of the school year and all of the things that come with it. For you, it's times four. No, it's a real thing. It's a lot. And it's all the school programs and everything wrapping up and buying the teacher gifts and. And for him as a teacher, it was the same thing and it just got to be unwieldy for our family. And it wasn't just May and December. There were other issues as well, but he made that conscious decision to choose our family and to choose a quality of life for our family. So that was a big deal, but it wasn't without financial ramifications. There were trade-offs to making that decision.
[00:12:26] Nicole Lorch: The other thing that we've recently decided to do is we're going to send our daughter to private school for high school. And that again has to do with quality of life and choosing what is right for her at this stage in her life
[00:12:40] Nicole Lorch: At this moment. And I am a big proponent of public schools. I have generations who have taught in public schools that my husband did. So it was a philosophical dilemma for us, but at the same time, we had to choose what was right for our daughters. So these were two big choices that I think kind of went against the grain of what my family would typically do. But for our family, for our tightly knit little group, those were the right choices at the right time. And it goes to quality of life, which I think is really what you're talking about in all of your sessions is how to get that Life Of And.
[00:13:17] Tiffany Sauder: Yeah. Were there places where when you made maybe these choices for your daughter and you and your husband to walk away a little bit from a community you've built in her public school experience and then also to go from having a spouse that's working home where those choices made you feel left out or you were looking at sort of suddenly the outside looking in where there was more than just a financial thing, but there was a separation of some kind that just made you feel displaced?
[00:13:49] Nicole Lorch: Oh well, I mean you could have my husband and ask him, but I know that it's an isolating feeling to be at home not working. And it's I think different for men than it is for women in some ways because at least where we live, there is a stay-at-home mom. There's a model for that, but there isn't as much a model for the stay-at-home dad and there's not a tribe for him to hang out with. So I think that that's been a tough thing for him going from being a teacher to being in a workplace where there were other adults to talk to as well as children to teach. Yes, that was a real adjustment for him. And sometimes I come home at night and I'm just brain dead. I've had every conversation, I've dealt with all the problems, I've made all the choices, and I really just want to sit and watch TV or scroll my phone endlessly and just breathe and drool and that's about it.
[00:14:45] Nicole Lorch: That's been an adjustment for me too to realize that I need to still be that outlet for him.
[00:14:51] Tiffany Sauder: I even want for myself to hear and capture from this is that even when you were talking about the decision, there was a visceral understanding that this was exactly the right choice for your little family and still it was hard. It was
[00:15:04] Nicole Lorch: Hard, of course it was hard.
[00:15:05] Tiffany Sauder: And that's what I want us to understand. Even when you're like, "I know this is the right choice. I know this is about building either balance sheet wealth as it relates to money or balance sheet wealth as it relates to time and connection that you need for life to feel sustainable." It is hard. There is a loneliness I think always that comes with choosing something new, moving your tribe, moving where your energy's coming from, moving your point of connection, and also doing something different than everybody else is doing. And it can create at least for me, this wave of doubt. Am I really making the right choice? Because man, usually the right choice means belonging somewhere. And I don't feel like I'm belonging, but I'm building something different, unique, long-term that I believe is going to play out right. And it's like you believe this is the right choice for your daughter.
[00:15:57] Tiffany Sauder: You believe this is the right choice for your family and you're laying these foundational seeds, you won't really know for a while. And I think that's so many balance sheet choices. You don't know for a while.
[00:16:13] Nicole Lorch: That's true. And it's hard to measure. I mean, because I'm a banker, I think so much in terms of dollars and cents and it's easy for us to quantify what my husband walked away from in terms of a teacher pension. It's easy to understand the dollar impact of that, but it's not as easy to understand how we're going to feel about it. And so there are emotional investments that we make in our lives and we hope that it's the right one. And you're right, there's a dissonance that is caused within us when it's something that our tribe would not do. In this case, my family would not have done that. And we still had to go against the grain and hope and pray that it's Team Lorch against the world here and we hope that we're making the right choices.
[00:17:00] Tiffany Sauder: Yeah. So thank you, Nicole, for sharing so transparently because I do think these are, again, back to what I hope this episode does is these are the conversations that we need to have with one another is where are you making new choices and how does that make you feel? And just giving one another confidence that if it's on the outside, it can still be right. So thanks for sharing that with us. Okay. I want to move our conversation, this balance sheet narrative, to this idea of women being bankable. That is not vocabulary that I had for a long time. And as I've built and invested in and bought different companies, understanding what it means to be bankable to a banker is something I understand now. And so I want to share that with the audience. So I'll just open that up with a broad question and then keep probing, kind of sitting in the seat of the listener of what do you mean by that?
[00:17:59] Tiffany Sauder: Of course. And to the extent that I can share how our journey has been, I will do that, but we'll see kind of where it goes. So what does that mean to be bankable?
[00:18:08] Nicole Lorch: Wow. So there are so many things that lenders are looking for. And our founder who is a lifelong entrepreneur talks about how he used to cuss bankers. He hated the way they wanted for him to redesign his plans around what the bank thought was best. I would say to your listeners, some of us don't know from birth that we want to go out and start a company or that we are going to want to buy a business. We may not even know that we want to own a home at some day. You I think were a young entrepreneur.
[00:18:43] Nicole Lorch: So you had that feeling very early, but you never know where life's going to take you. So there are certain things that I would advise all people to do, whether they think they're going to work in corporate America or they think they're never going to work, or maybe you do want to someday own a business. Think about your own personal credit score. We're going to talk about again, income statement and balance sheet thinking. What lenders are looking at is how much debt have you taken on relative to your income? So that's one thing. If you think you're going to go buy a house, debt to income is one of the very first things that they look at. Because when banks are making decisions, we are thinking about how likely is it that you'll pay us back?
[00:19:27] Nicole Lorch: That's what we're looking at. And some of those things can be measured in terms of how many responsibilities are you taking on? What do you have to spend every month before you're even going to think about paying the bank back? So we think about things like your housing, your transportation, what do those absolute minimums cost you and what does that stack up relative to how much you actually make? So debt to income is something we're thinking about, your credit score. The credit score is that big black box. Nobody knows exactly how it's calculated, but there are some hard and fast rules, which has to do with how many different avenues do you have to borrow? How many credit cards do you have? So how much is out there? Do you have $25,000 available to you on credit? Do you have 50,000, 100,000? How much money is available to you that at any given moment you could go out and charge up the cards?
[00:20:30] Nicole Lorch: And then how much of that are you actually revolving? Are you paying your cards down every month or are you always carrying a balance? And how much left is available to you? So those are things that lenders are looking at. What we want to make sure is that you're displaying a pattern of responsible use of credit. I
[00:20:51] Nicole Lorch: Don't know that any banker would tell you don't take out any credit cards. You actually need credit cards to build a credit history. It's hard sometimes to get that first foot in the door, but if you can start, if you know, for instance, that your credit is not great right now, there are secured credit card programs out there. Be really careful.Be really careful because so many of them are traps. So check with Better Business Bureau.
[00:21:17] Tiffany Sauder: What does that mean a secured credit card? Wht does that mean? I don't even know what that means.
[00:21:21] Nicole Lorch: Okay. So a secured credit card is this idea that I'm going to put up $500 of my own cash in order to get a $500 credit card.
[00:21:30] Nicole Lorch: And so am I really getting credit? No, but it will show in your credit report as some lender has extended credit to you and then you pay that back every month, you make charges, you pay it back, and all the while that lender is holding your $500 or $1,000 so that there's no risk of loss to them, which is why it's secured. Anything in lending, anything in banking that we say is secured means there's some form of collateral that has been put up against it. So you may have given your own cash and that is protecting the lender, but at the same time you're able to build a credit report.That's
[00:22:09] Tiffany Sauder: A tool that if you're rebuilding credit or establishing credit for the first time that can be used?
[00:22:14] Nicole Lorch: It can. Yeah, if you're building credit for the very first time or if you have to rebuild credit, that's one way to go about it. You need to start borrowing and showing a good track record of repayment in order to build a healthy credit score.
[00:22:32] Tiffany Sauder: I want to take a quick moment to thank my partners at Share Your Genius. For the past four years, they have been an incredible part of my journey behind the microphone. Share Your Genius is a content and podcast production agency that helps leaders and brands bring their message to life. So whether you're trying to find your voice, develop a content strategy, or get your leader behind a microphone, they're going to help you make it simple, strategic, and impactful. Interesting. Didn't know that existed. So one of the things that you kind of said this a little bit earlier, that your founder hated bankers. I do think bankers and cops, when you don't understand their real, and I'm saying this a little facetious, but when you don't understand their true nature, they can be representative. Are they really here to protect you? And I have found that is the case.
[00:23:17] Tiffany Sauder: When you really understand what a banker's motive is, it's that they get paid back, which also is good for you because if you're able to pay them back, that meant good things happened probably in the thing that you invested in. But understanding what takes place, and let's maybe talk on the business side inside of those, I don't know if they're like credit, what do we call those meetings where essentially a loan application is reviewed? Credit committee. Yeah, credit committee. I just imagine they're watching a - There are
[00:23:46] Nicole Lorch: Cigars and martinis and we're making evil decisions.
[00:23:49] Tiffany Sauder: Or it's like a reality show being like, yes, what is the next thing that's coming up here? It's like take us into that room visually a credit review meeting. What takes place? How many deals are you looking at? Who's representing it? Because it is the X's and O's of the deal. But what I've learned is it's also the story and you can put yourself in a good position or maybe a more probable position as someone who's coming and asking for money if the banker is understanding your behaviors, your intentions, your track record. And so I've learned there's some nuance in it too. So can you take us somewhere? So
[00:24:28] Nicole Lorch: You're going to go behind the curtain. Yes. Okay. Well, it's maybe not as delicious. Salacious. Yeah, exactly. It's not as salacious as you might think. At First Internet Bank, we've always prided ourselves because our founder hated bankers and hated the evil credit committee. We have tried to get away from credit committee meetings where decisions are made. In some small bank or some community size banks, those still work because you can have a team of directors or a team of leaders who know most of the people in the town and they'll say, "Oh, I know Jan, I know Joe. They're good people. I've known their families for years." Those kinds of inputs are valuable. But when you get to a bank that is our size, we're working on a nationwide basis, we don't necessarily have firsthand knowledge. But that said, we do have a lender who's working with you, is working with the business owner, working with the team from the business, and they bring the story.
[00:25:30] Nicole Lorch: So we have guidelines. There are some guardrails is how we like to think about them, but they're not even hard and fast rules always because they are just guidelines. And so decisions can be made. We like to be more flexible. We like to be more responsive and to frankly be faster. Because a lot of times in lending, it has to do with who's able to get you the answer first more so than is the rate going to be seven and a half or seven and three quarters. The turnaround time speed is really important. And we talk about a fast no is more valuable than a long slow maybe. When you're a business owner, so many of your decisions have to be made
[00:26:13] Nicole Lorch: Right then. Even as a homeowner, we've seen hot real estate markets where you've got to be able to decide right then if you can make the offer or not make the offer. So having a bank that has some flexibility I think can be important in terms of speed to respond. So unfortunately we don't have these behind the scenes credit committees, but there is a process where the lender gets to know you will take so many documents, more documents than you ever thought that you owned or you could possibly produce. I mean, you've been through this and it's like you need a tax return from when? And so yeah, have the last three years definitely ready to go in terms of tax return and financial statements, both personal and business would be helpful to have at the ready. And there will be a team behind your lender who's working to actually build a credit memo.
[00:27:09] Nicole Lorch: That's the story of your loan. And depending on the size of the loan, depending on the purpose of the loan, all of those things, the credit memo can be 45 pages, it can be two pages, but that's where the story of your loan will be written and that will be the story of you. So
[00:27:28] Tiffany Sauder: Have a good - So is there actual pros on that?
[00:27:31] Nicole Lorch: Oh, yeah.
[00:27:31] Tiffany Sauder: Okay.
[00:27:32] Nicole Lorch: Yeah. I love a story too. I mean, we are one of the nation's leading small business lenders and I call them snowflakes because there are no two stories that are identical. Every small business owner, that is the story of their upbringing. It is the story of their belief system. It is the story of creation right there on a page. We're creating jobs, we're putting food on tables for families. And so I like the story of a business to understand what's driving them, to understand what made them make this decision to get into business ownership at this time. So we talk about the five Cs of credit and one of those Cs is character.
[00:28:19] Tiffany Sauder: So lay people don't know the five Cs of credit. What are they?
[00:28:22] Nicole Lorch: I really shouldn't have opened my mouth.
[00:28:23] Tiffany Sauder: I know. Well, that's okay. We'll have Nick search the internet for it. And so we can bring it in offline. He can be our producer on the site.
[00:28:32] Nicole Lorch: Please first also make sure that it's not four Cs of credits.
[00:28:34] Tiffany Sauder: Yeah, we'll see how many Cs. But this is interesting. I never had heard that before because it does feel like this black box of financial geniuses that know about an extraterrestrial place that the rest of us have never been to. That's what it feels like when you talk about bankers banking. It's like, what do you mean? And so knowing that as the one who's coming and saying, "This is what I need the loan for, this is the story behind it, " that that is part of what you care about, makes you start to say this is about more than just being a number to you. Absolutely. And it is about you investing in what I'm trying to build. And I think when I realized that like every other place on earth, it is people helping people. That's really what a great lender wants to do is put money in the hands of people that are going to go create jobs, create community, create beautiful places for people to go and be, restaurants and experiences.
[00:29:31] Tiffany Sauder: The great lender, that's what they want to do. And I sort of felt like,
[00:29:35] Tiffany Sauder: I don't know, I didn't know that that was what that job was about. And I think that's part of what I want this episode to be is that is what that job is about. And if you have the heart of an entrepreneur, if you have the desire to build something, they are dying to meet you. Absolutely. So that they can help you figure out how to birth that into the world. And bankers have been an important part of every single thing Something that I've done financially. Our little family has not been a cash only operation. We need lenders to come beside us beside me and believe in the vision with me and be my partner in it. And I think that's what I want women listening to this to understand. If you're a small business owner and you're trying to figure out how to grow, find a lender.
[00:30:22] Tiffany Sauder: I would say call First Internet Bank and talk to one of their people to say, how can I make this happen? Because they are there to be a sover with you, not just a scary monster. It seems so trite, but that's literally how I used to think about it.
[00:30:38] Nicole Lorch: I can see why there is that kind of black box. You don't know what's happening there. You just put all your documents in and hope that you get a yes at the end of it. But you're right. I mean, you should have a relationship and as a business owner yourself, you know this. I mean, have a group of people who are going to help you make decisions. Really trust an accountant, really trust an attorney, have a lender that you trust because you will need input from all of those. And sometimes small business owners think they want to not spend money on those services and I can do that myself. I maybe get so far with QuickBooks or online legal advice, but we will take more seriously a borrower who has invested in a lender, who has invested in professional accounting services because the quality will be there.
[00:31:33] Nicole Lorch: And a good lawyer, a good lender, they won't just tell you you can and can't do X or Y. They will give you a range of options. And so yeah, it should be a relationship where you say, "This is what I'm trying to achieve and they should ask questions of you. " So with all of those professionals, make sure that you trust them, that there is a good relationship there. If you feel like they're not out for your best interest, that's not the partner for you.
[00:32:02] Tiffany Sauder: So we briefly mentioned this, the five Cs of lending of credit, the five Cs of credit. Five Cs of credit. And so we side quested here and we're going to bring those to the audience here in a little package. So Nicole, do you want to go through those five Cs? Because again, to me, this is about how do we take something abstract and give us a sense of understanding, which then gives us a place something we can control and influence. Of course. So that's why this is important to
[00:32:25] Nicole Lorch: Me. So lenders think about the five Cs of credit and these are the categories of information that we are looking for. So we're looking at capacity. How much ability do you have to repay the bank? We are looking at collateral. We talked a little bit about that earlier. What are you putting up or what do you own? Because yes, lenders will want to put liens on things, which means -
[00:32:50] Tiffany Sauder: I know. The such chickens.
[00:32:52] Nicole Lorch: Yeah.
[00:32:53] Tiffany Sauder: Go ahead.
[00:32:55] Nicole Lorch: So if you get to a place where you are unable to repay your loan, what else could a lender take that would be of equal value to repay that loan? So yes, collateral is something that we're going to talk about. We are also looking at capital. So how much money do you have in the first place? And that seems a little contradictory, right? I'm borrowing money because I need money, but we are looking, and this is again, lenders want you to be successful. We have seen so many small business owners get into business ownership without any sort of liquidity, without a safety net behind them. And I assure you whether you are starting a business, buying a business, you're buying a home, it will always take longer. It will always cost more than you ever thought that it would. In business school, we talked about the rule of three and my founder said, yeah, it's really more like the rule of four.
[00:33:53] Nicole Lorch: It takes four times as long as you think it will and it costs four times as much as you though it would. So are looking at capital and the amount of money that you have behind you and the amount of money that you're willing to put up as well because that is something that indicates what stake you have in the game. So that's important. We talked about character and I think that's a big one that is sometimes hard to explain on paper, but that's where your lender can really get to know you and get a feeling for what your character is. But yeah, we will look at background histories on people. Have they repaid their debts in the past or are they trying to run from the law? That tells us a lot about who you will be in this new endeavor.
[00:34:43] Tiffany Sauder: Yeah, this past behavior is a predictor of future.
[00:34:47] Nicole Lorch: And then the fifth one is conditions. So what types of things are happening behind the scene? Are you buying a business? And if so, are their trends going in the right direction or are they declining? Is revenue growing? Is it contracting? We might look at what kind of credit cycle are we in? And if you're buying -
[00:35:07] Tiffany Sauder: In the macro sense. In the
[00:35:09] Nicole Lorch: Macro sense, absolutely. I mean, the things that are happening that are out of your control as a business owner are going to have so much impact on your business. So character speaks to what you personally, we're looking for grit, what you personally have and the sticktuitiveness to see something through, but conditions are largely out of your control. And so those two do go together, character and conditions.
[00:35:33] Tiffany Sauder: Because every entrepreneur thinks they can outperform the conditions.
[00:35:36] Nicole Lorch: Well, every investor thinks they can outperform the market.
[00:35:40] Tiffany Sauder: Totally. Yes. And we get ourselves in trouble sometimes with our optimism.
[00:35:44] Nicole Lorch: Sometimes. And the averages exist for a reason.
[00:35:47] Tiffany Sauder: I know. All entrepreneurs hate real math.
[00:35:50] Nicole Lorch: Well,
[00:35:51] Tiffany Sauder: My dad turned 70 and I had seven lessons for seven decades. And then I said, because he's a roundup kind of guy, I had 10 because he's a serial entrepreneur. I'm like, "This is my dad." It's like seven is really 10. 10 is really 100. Okay. So it's all
[00:36:07] Nicole Lorch: Entrepreneurs.
[00:36:08] Tiffany Sauder: Yes. Exactly. Exactly. Well, I think I want to maybe wrap this up to say we've talked, I think introduced probably some new vocabulary and some new constructs to the audience. I
[00:36:18] Nicole Lorch: Hope we haven't lost anyone.
[00:36:20] Tiffany Sauder: Yes. If you're still with us, I want to thank you for learning to listen to the words, how to say them, how to have conversations around them is about raising our collective financial literacy, financial knowledge, financial vocabulary. I want there to be more strong, successful female leaders and female entrepreneurs and female business owners. And when we have the vocabulary around money, then we can use it as a tool. And maybe I'll use one of the lessons I shared about at my dad's birthday, which is money is a tool and not an identity. And when you begin to be able to separate those and say, how do I think about this well? How do I put myself in a good position? And how do I use partners like bankers to help me fulfill my purpose in life and to grow the things that I can see some beautiful things can be built.
[00:37:15] Tiffany Sauder: So can we put a bow on this and say, if there is a high achieving woman listening to this and she's saying, I've heard a bunch of stuff and I'm trying to figure out where do I start? What advice do you have for her?
[00:37:33] Nicole Lorch: I feel so passionately about this because in the year I was born, the Equal Credit Opportunity Act passed. And it blows my mind to think that before I was alive, women could not necessarily take out loans in their own names. They couldn't have a credit card without a husband co-signing. And so it took legislation to make things equal. So I think about all of the change that has happened just in my lifetime. And so I feel in some ways I feel really passionate about this. Maybe it was my destiny to be a financial feminist. So
[00:38:13] Nicole Lorch: To anyone who is out there listening, it's never too early to start. It's never too late to start. Understand the common language. And anytime we're learning a new language, it's hard. And so accept that financial language is maybe different than what you're used to speaking every day. You don't need to go into your bank and talk about balance sheet thinking and collateral and capital and all of those things, but understand what the banker will be looking for, what the lender will be looking for. And I think more than anything, understand that lenders really do want to be your partner in success because we are in this together and we want to build things and grow things. And it's so exciting to see entrepreneurs like you and across the country, women wanting to start businesses and lead businesses because that is going to paint a different picture of what our country looks like 50 years from now.
[00:39:17] Nicole Lorch: So we're excited to be a part of the journey. Please feel free to ask questions, reach out with questions. And yeah, your lender wants to be a partner in success.
[00:39:27] Tiffany Sauder: So good. I think that's exactly right, Nicole. And two things are coming to mind here as I bring this to the close. One is that my next episode that I'm doing actually is going to be around an actual transaction that we've recently done with First Internet Bank. And so we're going to be diving deep into that. If you guys are like, oh my word, are we seriously going to keep going here? We are. And it's because we love you. It's because we want this for you. And I want you to have the courage to have the vocabulary around this. The second thing that's coming to mind is we are working on an in - person conversation at First Internet Bank this fall. And so if you would like to join us for that where we will be having this financial conversation with you, answering questions and just creating an environment where women can practice the language of money with one another.
[00:40:21] Tiffany Sauder: And so as Nicole and I are just creating this movement together and working together to create places where you can learn in private like with this podcast and you can experiment in a safe place like this in - person event that we're working on for this fall, we hope that you're finding your own financial courage begin to grow. So thank you for joining us for another episode of Life Of And. If you've learned something in this episode, please share it with a girlfriend and then call her and say, "Can we fumble through this conversation together so that we can get better?" If you are interested in joining us this fall, then sign up in the link in show notes. Sam will put a link for us. She's writing the to - do right now to do that. And I hope that you're enjoying the rest of your summer.
[00:41:05] Tiffany Sauder: We'll see you back here next week. Thanks for joining us.