Latest / Beyond the Paycheck / Kristine Karnath, Group VP of Total Rewards at Moog

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Kristine Karnath, Group VP of Total Rewards at Moog · Beyond the Paycheck

• Courtney Cardin (00:42) Thank you so much, Kristine Karnath for being here and for joining us. I'd love for you to introduce yourself to our audience. Kristine Karnath (00:48) Hi Courtney, thanks for having me. My name is Kristine Karnath. I am the VP of Total Reward at Moog, which is an aerospace defense company. I've been at Moog for almost 21 years and we're headquartered ⁓ just outside of Buffalo, New York. Courtney Cardin (01:03) Great, and we're so excited for you to be here and hopefully you're staying warm up in Buffalo. I'd love to just jump right in and hear a little bit more about your experience and your earliest money memory. What is your earliest memory and how did it shape how you see things like security, freedom or responsibility? Kristine Karnath (01:08) You know? Yeah, I was thinking about this and one of the things I remember earliest kind of about money was ⁓ I was in kindergarten. So it's about five. And our teacher had asked us to draw a picture of what we wanted to be when we grew up. All the kids are drawing like firefighter, policeman and ballerina and fun things that normal five year olds do. And I still have this picture. I drew a picture of a person, I'm assuming myself, at a big wooden desk, piles of coins on it, kind of like Scrooge McDuck, and like coins floating in the air and it said banker over the top. I don't know what I knew about being a banker. I think I just wanted money. I think that's what my interest was. I just wanted to work with money and I wanted money. And so I think that kind of gives an idea of kind of even from a young age, my view on money. I'm actually fairly physically conservative personally, I'm not very risk averse. ⁓ always ⁓ saving, always had my Snoopy bank at home that was filled with coins and then graduated to a wallet that was with money. so, yeah, just always kind of worried making sure I had enough. don't know why, because it's not like I ever had to pay for anything when I was a kid. But I think my parents were fairly risk averse and very careful with money. And that's just what I knew and what I learned. A movie never did without. Courtney Cardin (02:37) you Kristine Karnath (02:45) We always went on vacation every year, but we did not live extravagantly. And so I think I've kind of always picked that up from there and have carried that through even to today, how I am. Courtney Cardin (02:58) Yeah. Well, thank you for sharing. So the research shows us that people really start developing their money personality by the time they're seven years old and it starts to solidify for them between around seven and 11. And I love that you as a little five-year-old were like, yes, money. This is what I'm going to get and I'm going to be super powerful and I'm going to be really great at it. Kristine Karnath (02:59) I'm And it stuck with me. have a degree in finance and I work with, you know, well, it might roll kind of money all the time. So, yeah, I guess I guess I didn't move away from that. Courtney Cardin (03:29) Yeah. See, you manifested yourself into this role. I'd love to know a little bit more about your first job and what you did with that first paycheck as well. Kristine Karnath (03:32) You know. So my first job, I worked at a flower shop. I was there about five years. It was a really small business. There were maybe, maybe 10 of us that worked there. I absolutely loved it. Again, I sound kind of nerdy when I talk about this, but I'm pretty sure I took my first paycheck and put it in the bank. ⁓ Yeah, maybe I kept a little bit of it. I did not make any big purchases, but I viewed it as I'm working for a reason. And it wasn't a say for spending money. was 17 when I got my first job. So was, you know, a senior in high school. So I was a bit older. ⁓ But my focus was I need to save money for college. And so I'm going to start now. So by the time college starts, I already have a bit of a nest egg saved. And so, yeah, I don't have an exciting story about what I, you know, some crazy purchase that I made because it just went all in the bank so that I could kind of start off a little bit on the plus side when I started college. Courtney Cardin (04:34) I love that. Also, you have a great story about being in a flower store. What's your favorite flower? Kristine Karnath (04:38) Gerber daisies. Courtney Cardin (04:40) ⁓ nice. So, okay. My guess is if you took our money personality quiz, I think you will learn ⁓ that you were probably squarely in the thinker realm, ⁓ the people who diversify their portfolios from the ripe old age of seven. I'd love to know, and there could not be an answer to this, but do you have any embarrassing purchases? Kristine Karnath (04:51) I that's probably. Yeah, I was thinking about this and I have to say I really don't. And I think the reason being is that when I started working and I actually had money to spend and after that first paycheck, I would put about half of my paycheck in the bank and I would save it, most half of it for spending and doing things. I mean, I did actually spend money and go out. But I have this really particular view of if I was going to buy anything, it had to be in need. Courtney Cardin (05:17) Mm-hmm. Mm-hmm. Kristine Karnath (05:31) not necessarily a want. didn't feel I was financially in a place that I could just splurge on things that I wanted because I was the, paid for school myself. And so I have a saving for college. I paid for every semester, I paid half of it in cash. So I only took a loan for half of it. And so for me, it was really important that I had enough money so I didn't have to take that loan to, cause knew I'd have to pay off eventually. And so anytime that I, Courtney Cardin (05:38) Mm-hmm. Kristine Karnath (05:57) I bought anything. mean, I would go out with friends and you know, it's not like I would never purchase anything, but it would always kind of fall into do I need it or do I want it? And then I would calculate how many hours would I have to work in order to buy this? And so if it seemed extreme, was like, I really don't need it. But I do remember one time I was out with my friends, we were shopping and saw a pair of sneakers that I wanted and they were probably 35, $40 like that. a ton of money, but at the time it was a lot to me and I didn't buy them because I didn't need them. And about two to three weeks later, I was still thinking about these sneakers and every time I would go out, I think all these sneakers would look so cool with this outfit. And I thought, you know what, I'm going to go get them because I don't need them. But it's not an impulse buy. I've been thinking about them. I will wear them. So I'm going to go buy them. I still have those sneakers today. I can't say the last time I wore them. I mean, it's been years since I've worn them, but I think I keep them just as a reminder of like, you know, this was like my first, not big purchase, but like my first purchase where I really, it wasn't something I needed, but I really thought about what it was that I, you know, whether I wanted them or not. And so, yeah, I don't have any like truly embarrassing stories because to your point, I've always been kind of a thinker when it comes to money and planning and making sure I had enough for what I. what I did need. Courtney Cardin (07:22) So I want to follow up on that. Was there a time when you felt like you had moved from, I'm not just going out or like you didn't have to wait the several weeks to go where you started to feel more easeful spending money or feeling like you actually were in a place where you could buy things that were more on the want rather than the need spectrum? Kristine Karnath (07:44) yeah, I would say probably after college, when I had like a, you know, real job, ⁓ know, career type job, I, I definitely moved. still very careful. Tried to buy, I still to this day, try to buy things on sale. Why pay full price if you don't have to. but you know, definitely would, you know, purchase things that, you know, definitely had to be within my budget, but was willing to purchase a few more things that I didn't need. Courtney Cardin (07:58) Totally. Kristine Karnath (08:12) I do remember thinking at one point, it'd be so nice to someday not really have to look at the price tag and worry about how much it was going to be. And I think it was probably years later where, you know, not that I never look at a price tag, but it's, you know, I'm not, I'm not structured as such a budget now because I don't have to be. I think because of the way I was for so many years and I live still to this day, well below my means. that it's allowed me actually that freedom now to be able to buy what I want and when I want to buy it and not really have to worry about it so much. Courtney Cardin (08:49) Yeah, that's a great foundation to build off of. I'm interested, how does your money story influence how you think about pay and benefits for your team now? Kristine Karnath (09:01) I think it does quite a bit because I am so careful with how I spend money. don't mean it's not my money when I'm working, but I kind of view it as if it were. And so I'm not in the sense I'm not well, I think even personally, I'm careful with my money. I'm not cheap, though. And so because I think there's a difference there and I kind of feel like I'm the same here. And so whether I'm working with my own team and making sure that there's equity within Courtney Cardin (09:19) Mm-hmm. Kristine Karnath (09:29) pay or I'm taking care of it or what I'm doing responsible for the comp and benefits for the entire organization. It's being fiscally responsible, but being fair and equitable. And that's kind of how I view my own personal finances and that's how I view it for everybody else. And I feel like, well, I know people who at work, they travel and they spend, I guarantee you, not the way that they would spend their money. It's you know, they're eating at the best restaurants and they don't care. You know, they're they're making travel arrangements last minute because whatever it doesn't sound their money. And I look at it and I'm like, Well, I don't I can fly coach that's I don't I don't I fly coach when I travel personally. So why wouldn't I do that? You know, for work and you know, there's very few things I kind of splurge on, which is usually just can I find flights that fit my Courtney Cardin (09:55) Mm. Sure. Kristine Karnath (10:22) you know, my needs of when I need to be somewhere and when I need to be home. yeah, whether it's, you know, spending, you know, taking my team out, you know, this week we're going out for the holidays for lunch and, you know, going to a nice restaurant, but not going to, you know, anything crazy. So it's, it's kind of just having that same view of as fiscally responsible as I am at home, I have to be the same at work in order to properly do my job. Courtney Cardin (10:24) Totally. Yeah, absolutely. Especially if you're, I mean, it's not your money, but maybe you're in charge of the budget or maybe you're responsible for allocating it and making sure those funds go a long way. You know, as a startup, Kelsey's job as CEO is to make sure that we don't run out of money. And so it is our money in a sense, and it's also our investors' money. It's really important to make sure that we are adhering and we're cost conscious. And as a result of Kelsey's, know, really good financial management, we've outlasted a lot of other startups. Kristine Karnath (10:51) Thank you. Courtney Cardin (11:18) in a pretty wild time. it is, that's a really good lesson, you know, to remember that the organization's funds, they're also there to serve a purpose, to serve the organization. And so the people who are in charge of managing those budgets have to treat their money like their own. It's a great reminder. Kristine Karnath (11:33) Yeah, I mean, ⁓ we have a profit share as part of the organization that every employee participates in. So all of us mismanage funds. That's all coming out of our profit share. And when it comes to benefits, for example, if I'm not managing our medical plan properly, everyone's going to pay for that. So the more I can save and what provide my view is always, how do I have a win-win? How do I give the best quality and care? to our employees with the best value and save the company the most money. And if I can save them, because if I save the company money, I'm also saving the employees money likely too. So it's not just shifting costs from one to the other. It's how do I actually improve the situation for everyone? And so, I mean, I've got example of an example about that at work of how we do that. How do we provide value to employees, save them money and save the company money? And then everybody's happy. Courtney Cardin (12:26) Absolutely. I would love you to share a little bit more because I think that's a pretty unique structure, ⁓ the revenue share model and sort of talk a little bit about how that shows up in your ethos as a company that is really treating their colleagues like co-owners. Kristine Karnath (12:42) So it's the profit share of the benefits of all. Courtney Cardin (12:46) The both, but I just want to double click because I think that's pretty interesting and unique. And I want people to hear how that is a part of the benefit ⁓ of working at Mog. Kristine Karnath (12:54) Yeah. Yeah, we have a couple of different kind of profit sharing or bonus type structures, but it's not individual based. It's really based upon how does the organization perform. So it depends on the level of the organization of what you're held to. So whether it's free cash flow or it's EBITDA or it's EPS, anything like that, it's how's the company doing as a whole? Courtney Cardin (13:08) Mm-hmm. Kristine Karnath (13:24) So we don't look at individual employees and we don't look at operating groups or departments to determine bonus off of that. We're all in this together. So we all share in it together. So if the company does well, we all do well. If you happen to work in an area that maybe isn't doing well this year, well, your bonus doesn't mean that you're not working. It doesn't mean, it could be that there are oftentimes, because we're a government contractor, there are things out of our control. about how our contracts work. And so it doesn't mean that anyone's working less. It just means that you happen to be in an area that economically just maybe isn't doing as well as others. But we all share in that. I mean, if we didn't have that, I'd be paying into a profit share because we never make money. I just spend money all the time being in corporate. So we benefit from the profit share. yeah, so from that aspect, it's very much aligned with our values and our culture as a that we are all in this together. From a benefits perspective, we have programs like, for example, we have an onsite wellness center that we looked and said, if costs are going up in medical, what's driving those costs? And what can we do about it? And so we try to actually get at the root cause of what's driving cost so that we can actually reduce the problem as opposed to shifting costs from maybe the company to employ. My view is if the company says we can't afford it. Why do we think our employees can afford it? And so we actually look and say, what's driving it? Let's reduce it. So for example, we have a site in North Carolina, that very rural area, there aren't a lot of doctors there. So people weren't going to the doctor. So what we started seeing was we had a lot of very high cost claims coming out of that site because people were waiting to get care because they were waiting, they had to drive two hours pretty much to get care. So they were waiting until they were really, really sick. Well, a lot of times they were very sick and so they ended up with poor outcomes or very costly treatments. And it was costing for us as a company, it was costing for them as an employee. And then the outcomes weren't that great usually. So what we did was we built an onsite medical center there with a doctor, with labs to get people primary care to see can we get them want to focus on their health, to be healthier. And also if there is an issue, Courtney Cardin (15:24) Sure. Mm-hmm. Kristine Karnath (15:46) try to address it and catch it earlier and direct them to the right care so that they can hopefully get better outcomes and end up reducing costs. So that's an example of things that we've done to say, okay, where can we actually provide a solution to a problem that benefits employees and benefits Courtney Cardin (16:05) Wow, that's incredible. I imagine you're already seeing the impact of that too. So you're seeing the real dollars and cents, but I'm curious, are you collecting sort of the qualitative data on that as well of people who are saying like, you know, I'm feeling better or like it's easier to do this. And I imagine that's probably a huge win for your employee base. Kristine Karnath (16:27) Yeah, so down there, site's only been open for two years. That medical center has only been open for two years. So there's still some of that to come. Our CEO was down there recently and he was telling me that people were just coming up to him left and right saying, this is life changing. The impact that it's having for them and for their families because it's open to dependents as well. And then, you know, also what's been able to happen for recruitment and retention. Courtney Cardin (16:47) Sure, yeah. Kristine Karnath (16:54) We do have two other sites, one here locally where I am and then one in Virginia. And those have been open 10, 11 years respectively. And that we definitely see, you know, we've seen impact on, you know, costs. But then we also hear the anecdotal data. ⁓ You know, we've got people who've been diagnosed with cancer from coming here, things that were caught that they probably wouldn't have been going to the doctor because it's so convenient here. Courtney Cardin (17:09) Mm-hmm. Kristine Karnath (17:19) We see, so a lot of that surgeries that have been avoided because they've been going to physical therapy here. People who have drastically lost weight because they've been seeing our on-site dietitian. We have an on-site pharmacy. So we see a huge adherence for prescriptions than what we were seeing before because they have access to a pharmacist who knows them and can catch things before it becomes a problem. And so we have a lot of anecdotal data. If you go over there, I was over there giving a tour last week and it's just people filtering, whether it's the pharmacy or the vision center or the regular wellness center, just people filtering through. So yeah, it's a huge benefit to our employees and I think employees recognize that it's a bit different than a lot of other employers out there. Courtney Cardin (18:03) Absolutely. How have you seen some of these sort of tools that you've used, this root cause approach, pay dividends in attracting talent and transforming lives? You just said a little bit about that, but I want you to expand a little bit more around sort of the root cause approach that you're using. Kristine Karnath (18:22) Yeah, and I don't know if our employees necessarily appreciate that in its essence, but I think the outcomes of it. you know, up until the last couple of years, we've been able to keep our medical costs fairly flat. So way below trend last couple of years, it's been a bit higher just because of GLP-1s and scripts and things like that. But we're hoping to see the benefit of that in long term. We do have a fairly robust wellbeing program. And I think it's one of those things that if you participate in it, you recognize the benefit, you get out of it. It's more of, I don't think it's really in people's faces because it's just part of our culture, caring about our employees, doing the right thing. just who we are. And so people don't necessarily point to what we're doing on my team or the wellbeing program because it's just an essence, an example, and an extension of our general culture at our sites. You know, what we do, we always make sure that it aligns with our company culture and our values. And so, yeah, so I mean, it's our culture we feel as a differentiator as a business in general. And that's why people stay here. You know, I have been here almost 21 years. I am not anywhere near towards the longest time you're here. I'm not even close. And there's a reason for that because people really Courtney Cardin (19:23) I love them. Thank Kristine Karnath (19:42) enjoy working here and how it is. And part of that is that we take care of our employees and we make sure that, you know, we're recognizing where they need help and we're willing to step up and help them where we can. Courtney Cardin (19:57) I think that's so powerful that you're doing something really interesting and revolutionary and making the root cause sort of the cornerstone. And you're saying yet that this is actually just the norm of our culture. even though I think you're absolutely right, this should be the standard operating procedure, but yet it's not. And so that is a big differentiator for you and your employees, which is incredible. Yeah. Kristine Karnath (20:21) Yeah, and I think a lot of it, we have a lot of engineers here and so they're very analytical. And for us, if we're just gonna check the box to roll out benefits or policies or guidelines that have nothing behind them, think people would become fairly skeptical of why are we doing this? Where if we can align it to the culture for one, and two, we have data that says this is why we're doing this. There's a reason for it. Courtney Cardin (20:40) Mm-hmm. Kristine Karnath (20:46) and here's the benefit that we see to you, to the company, people are going to be much more likely to get on board with it. So as a part that, and I know there are employers that, oh, this is the hot new thing, let's add it. And it might work for their culture and that's fine. That would never work for us here. And so we've got to make sure that there's really a purpose and a reason behind what we're doing. Courtney Cardin (20:54) 100%. Mm-hmm. I completely agree. We use a root cause approach to financial wellness and managing financial anxiety as well. We learned through doing a lot of financial coaching that just bringing up sort of financial literacy before someone is prepared to emotionally engage with that content is just very difficult to do. And so we really talk about like those money personalities as we talked about and sort of those scripts that you inherit and the reason that you wanted to be a banker and you were so vigilant. ⁓ and had that great upbringing to really be mindful about the debt that you might be taking on and were so disciplined. Not everyone has those scripts and this is a challenging time, right? You can, graduate from high school, you get a ton of applications for credit cards, no one tells you how to use credit. ⁓ We just expect people to learn. And so just like you expect people in rural places to know how to go to the doctor and sort of be healthy and do all of these things that might be easier and come more naturally to you if you live in an urban area. If you create that access, you create that opportunity and you make it easy for people to engage and learn about health and wellbeing, they tend to want to do that for themselves. People want to choose better options for themselves. So we agree completely. Switching gears a bit, looking ahead, which compensation or benefit trends do you think will most shape the employee experience in the next 12 to 24 months? I realize this is kind of a loaded question with AI coming at us so quickly and the work landscape changing, but you seem to be on the forefront of innovation in this space and we'd love to get your thoughts on it. Kristine Karnath (22:47) Yeah, I think what I'm seeing, and I think it'll continue, and I think AI is going to be a part of this, is really having things become much more personalized. So I think we've spent a lot of years, like in financial well-being, focusing on that education piece. And I think there's a lot of people who know the basics and they understand. It's kind of like, you know, your physical health. People know that salad is healthier than the doughnut. Like, they know that. Courtney Cardin (22:56) Mm-hmm. Mm-hmm. Kristine Karnath (23:15) But a lot of people still eat their Courtney Cardin (23:15) Sure. Kristine Karnath (23:16) grown up because it tastes better. And that's the thing with financial well-being too. People know that they shouldn't spend more than they make. But I think we live in a culture and a society that's a very on-demand culture and people are impatient and they don't want to wait for their dream home and they don't want to wait for their dream vacation. They want to do it now. And they know necessarily that maybe they shouldn't, but they also want to kind of live for the Courtney Cardin (23:44) Totally. Kristine Karnath (23:44) And I think as we become, we have the ability with AI and technology to become more personalized, I think we'll be able to actually kind of break that education down a bit to allow people to see what is the personal impact for these decisions. I also think we need to start moving towards getting to people earlier on in their careers. I think for a long time, we focused on retirement, which is actually very important and people. you know, saving for retirement, especially as pensions went away and DC plans came about. But I think we focus on people who are already in a problem. are they have already made decisions that have caused an issue for them. I think what we're trying to do and what we're looking at is how do we pull that back? And as our workforce is changing and is becoming younger because we have, you know, long tenured, some people stay a while. So a lot of those people are starting to retire now. How do we get to people before they make some of those life changing decisions? Buying the first home, buying that expensive car, getting married, having kids. How do we kind of get to them with that personalized information to say, okay, let's think about how you make these decisions. So what is a value to you? What is a priority to you? Not just now. Courtney Cardin (24:44) Mm-hmm. Kristine Karnath (25:03) but also long-term, really thinking long-term. And that's difficult for people because people are very focused on the now. But if we can make it personalized, I think people will be much more likely to start thinking a bit differently in how they make those decisions. We used to do, back when I started, we used to do a lot of meetings around the 401k and how to invest and stuff like that. And the question we would get all the time too, we would get is either, Courtney Cardin (25:07) Definitely. Kristine Karnath (25:31) Okay, what does that mean for me? So can give them all the information, but they still couldn't connect the dots of what it meant for them. Or they would say to me, well, what are you doing? And my response would be, well, you're a 55 year old man and I'm a 25 year old female. Like we are in completely different points in our life. What I'm doing has no relevance on what you should do. And so people, they can have all the information, but if it's not personalized to them, it doesn't necessarily mean Courtney Cardin (25:33) Mm-hmm. Totally. Yes. Absolutely. think I completely agree with you. That's the whole basis of the product that we're building, which is a personalized financial coaching platform that helps you identify your own scripts, the things that are always running on repeat. And I think it's so fascinating that you said that about what are you doing because people really do want to know what their peers are doing. And in your case, even maybe not quite your peers, because they want that external validation. Everybody, when it comes to money, It feels like there's a secret that some people know that they're let in on and other people don't and you're not supposed to talk about money. So it's really hard to sort of get a clear view or feel like you're on the inside. And that's also something that people need to overcome. That's also something we work really hard to break the taboo around talking about money. So people feel more comfortable understanding the struggles other people are. showing up with, know, buying a house and then being house poor, it's a super common problem and you're not alone. What do you do then? Or is that a problem you might run into and then maybe you don't want to take those steps? Kristine Karnath (26:58) Yeah. Or I think people, because of the On Demand site, I think there's very much a Keeping Up With The Joneses mentality that's out there. I've never subscribed to that, just not who I am. I could care less if everyone I know has a bigger house than me. If I'm comfortable where I am, it's fine. But not everybody thinks like that. And what I've told people, my husband sometimes gets house envy, go to see other houses. we don't live in... Courtney Cardin (27:10) Mm-hmm. Kristine Karnath (27:31) tiny house, but we don't live in a huge house. But he'll say, you know, what are we doing wrong? And I'll say, we're doing nothing wrong. Like we have no debt, we owe nothing to anybody. We owe everything free and clear. We're not doing anything wrong. Because what you don't see, you see a huge house and fancy cars. You don't see the debt, you don't see how much they have in their bank account, you don't see their 401k balance. And so I think that's a lot of things that people Courtney Cardin (27:33) Right. Mm-hmm. Kristine Karnath (28:00) They see what people allow them to see. They see the fancy vacations that are posted on social media and all this stuff, but they're not seeing maybe the stress that's behind that. Maybe what they're not able to do because they don't have the money to do it because they're just very focused on how everything looks. Where for me, my priorities are I want to be able to retire early and comfortably. I want to be able to travel. I want to be able to have my kids be able to Courtney Cardin (28:05) Exactly. Right. Kristine Karnath (28:28) do things or go to the colleges that they want without fear of what's going to be waiting for them after graduation financially. And so to me, those are priorities. So I'll live in a smaller house that I could pay off and be able to do those things, then worry about a bigger house, more you got to heat, more you have to furnish, more all that stuff too, more you have to clean. it's... Courtney Cardin (28:35) Mm-hmm. Mm-hmm. Totally. Kristine Karnath (28:54) To me, that's what's important. And I think there's different values that are out there, but I think people do get caught up in the, well, my neighbors have this or my friends have this. I want that too. Courtney Cardin (29:03) Yes. And if you don't do the part that you've obviously done a lot of work on, which is like understand your personal values and have your personal goals and define what success looks like for you, then you will subscribe to the default, right? You will fall into that trap of seeing everything that you see on Instagram and thinking you're doing something wrong because you haven't done the work to really think about like, what does success look like to you? And today, know, homeownership is more difficult than it ever was, but investing is more Kristine Karnath (29:32) Okay. Courtney Cardin (29:33) easy than it ever was, right? There's access to all of these different tools that make it much easier to grow wealth in a very different way that our grandparents couldn't have even imagined. And so what's your personal plan for success and how do you get there is really foundational to being able to make the right decisions and stay aligned. And I think it's great that you've done that because you're able to when your husband, I mean, it is fun to go look at other houses. it's, yeah. Kristine Karnath (29:58) ⁓ yeah, but you also have to be realistic about things as well. Courtney Cardin (30:02) Totally. And then when you get to, when you have that answer to what are we doing wrong? You're like, nothing. This is very much in line with my plan. This is what I always wanted to do. And you have, and you say it, and even when you say it, you just demonstrate the freedom that comes with knowing that your investment is in alignment with your personal values. So I know I'm keeping you because I'm just so fascinated in this conversation. But I'd love to know what mindset shifts, guardrails or governance do you think other people leaders need? to have to keep pay both fair and empowering in these rapidly changing times. Kristine Karnath (30:38) I think one, I think we have to actually understand our workforce. And I think when you're looking at, hey, when you look at the compensation side, it does not move as rapidly as the benefits side does. But I think you actually have to understand your workforce and where they are. And I think you have to understand the generations and where they are, because they do think very differently about finances in life in general. I think back Courtney Cardin (30:43) Mm-hmm. Kristine Karnath (31:05) when you're looking at, say, the baby boomers, a lot of them had pensions and they were, they lived at a time when buying a home was very affordable. There was a very strong middle class during that time when they were coming up. Now you've got millennials and you've got Generation Z that are coming, Generation Z is coming into the workforce and they're in a very different position. They're much more focused on that social media and the now. Courtney Cardin (31:09) Mm-hmm. Kristine Karnath (31:33) They're also much more focused on that balance of life where my job isn't everything. I'm not necessarily willing to commit to one company forever. know, pensions are no longer, I mean, they're too expensive, but also it's just no longer an interest for a lot of people. And you've got, you know, they want to live life now. They don't want to wait to live life. And nothing, there's anything wrong with that, but they also have to understand Courtney Cardin (31:37) Mm-hmm. Kristine Karnath (32:03) What does that mean? So what does that mean in the future when you don't want to work anymore? You can't work anymore. But what does that mean when you have large expenses that are unforeseen? Are you prepared to handle that? And so, you know, I think understanding your workforce, cannot treat the generations that are coming in today the way you treated the generations that are leaving. And so and that goes for everything, not just not just pay, but that goes for benefits and really HR in general. You really have to have that understanding. And then you have to build the programs around what are the needs and the wants, whether they recognize it or not, of that generation that's in your workforce. Courtney Cardin (32:46) Absolutely. And it's also, you know, on your team, also to sort of take on that responsibility of educating them on that, right? That's why you have the benefits that you do. we always say we teach to a 50-30-20 spending plan. We don't like budgets because everyone says they want a budget. Nobody wants to use a budget. Kristine Karnath (32:55) you Courtney Cardin (33:06) But a spending plan, really a guideline that you should be spending 50 % of your monthly paycheck on your needs, 30 % on wants, and 20 % savings and investing if you can. It's just a guideline. And we understand that there are a lot of young people that live in urban areas where they can't afford to do that because rent takes up more than 50%. And we don't want people to punish themselves for making that decision. We want them to understand that they're making an investment in a component of their life. It's important for them to be in. that city at that time in their life doing the things that they're doing, and that should be an investment in their longer term. But there are real trade-offs, and the important thing is to understand what those trade-offs are before you end up... Yeah. Kristine Karnath (33:47) Exactly. And that goes back to the priorities. That goes back to understanding what are your values, what are your priorities? What is of an interest to you? I have a daughter who's a junior in high school and she's thinking about college and where to go. And she's also thinking about what does she want to do and post college and where she might live. And these are all the conversations we're having with her. You know, you could move to Manhattan and that's super exciting. And that's, you know, what an awesome experience. Here are the pros, here are the cons. Courtney Cardin (34:14) Mm-hmm. Kristine Karnath (34:15) Here, you Courtney Cardin (34:15) Mm-hmm. Kristine Karnath (34:16) could live in Buffalo, which is not known as being as exciting as New York, but it's like, maybe not a fun place to visit, but it's a nice place to live. Here are the pros and the cons of living in someplace like Buffalo, and everywhere in between. so, kids have to think about that. I'm making her take financial literacy in high school because I think it should be a required course that every kid takes. in high school before they even get to college. So they start thinking about these things and start looking at finances in a responsible way and not just go, I think too many of them just go in and, ⁓ I'll worry about that later when I'm an adult. Well, no, because you're going to rack up debt now and you're going to make decisions now they're going to impact you as Courtney Cardin (34:49) 100%. I keep saying, you know, I learned sign and cosign and all these things that I've never once used in my adult life and I did not get financial literacy in school and I use that every day. So I agree. Okay. Final question. What tools, data or automations are helping you measure and improve financial wellness and pay equity in your team, your organization? Kristine Karnath (35:11) Exactly. ⁓ so I think what we're really looking at now is a lot of AI, which I mean, we're, it's, we're almost like an AI overload now, right? But I mean, it's, that's really what we're looking at, is going back to what I've seen before about the personalization is how can we bring tools into the organization that people can get the information they need when they need it. And in some cases, can we actually mine the data that we have? Courtney Cardin (35:43) Okay. Kristine Karnath (35:51) sounds kind of big brotherish, which is not our intent, but can we mine the data that we have so that we can actually try to push out information that people need before they realize they need it? Because I think with financial well-being, that's often the case is sometimes people realize what they need way too late and they've already made those very costly decisions. So, you know, how can we work with a vendor or a company or do it internally where we can Courtney Cardin (36:03) Yes. Kristine Karnath (36:20) actually get that information out to people that is relevant to them in that moment when they need it. And how do we do that globally, which is the real challenge, because it's not just in the US that's an issue, it's an issue globally. Courtney Cardin (36:34) Absolutely. Well, this has been such an incredible conversation. I agree with you completely. We are using LightTouch AI to also help augment our experience because in our approach, we obviously get such a wealth of data around our users that we don't share back, but it helps us create a better experience and helps. us get to know people and part of your total rewards and compensation package are the benefits that you're not using. And so we want to make it easier for people to understand what benefits are being offered and how to leverage them because if they're not, they're actually leaving money on the table. The benefits are called benefits because they're supposed to be a benefit of you working there. And we want to make sure you're getting the full benefit of being an employee of one of our partners. ⁓ It's been such a pleasure, Christine. I really appreciate you joining and I had a great time on this conversation. Kristine Karnath (37:27) Thank you for having me. Thanks for asking me on. Courtney Cardin (37:30) Yeah, thanks for coming.