Did Not Expect This Mess

0:00I'm Garrett. I'm 37 years old. Based out of Minneapolis, Minnesota. and this is Financial Blog. A fellow Midwesterner. I'm from Michigan. Thanks for coming down. I'm from Midwest. Yeah. Yeah. I don't miss the winners. I don't know how you're still there, but you get it. Yeah. So it's a love-hate relationship. What do you do for a living right now? So best description is data engineer. Oh, love it. That has to be pretty good paid. Well, actually, I already know how much you make, But how much do you make? So this is actually part of what we're going to get into. Yeah. But so most recently I took a contract job, W-2 contract, not$10.99.

0:48Sure. And that was$105 an hour. Mm-hmm. Yeah. It's delicious. No, it's good pay. Yeah, it's good pay. How many hours a week? Well, it's a 40-hour work week, so yeah. But actually next week, I'm starting a new job. I did land a new job. Full-time salary,$250 a year. Okay. So if$218 wasn't lovely enough,$250 a year, I love that. That's incredible. Yeah. That's awesome. So you're obviously a bad ass for what you do. I'm pretty good. That's awesome. I absolutely love that. So$250 ,000 a year, how long have you been making, and let's just say six figures. How long have you been making six figures? A while, but it's been, so here's the thing.

1:43Like when COVID happened, that was like a big shift because I was very local, you know, like, you know, making a good living, right? But local companies would pay maybe$150 ,000 a year. Sure. Right. And then when COVID happened and everyone was like, oh, we're all remote. Then it's like the whole world was opened up to me. And you're remote now in the new positions? Yes. I'm remote now. Yes. And so then it was like, oh, do you want to make$300 ,000? You know? Yeah. But even then, my dude. Yes. $150 ,000, let's just say. Yeah. You have made too much money for too long to have too many high interest, high balance debts.

2:37Yes. Especially nearing 40, my dude. Okay. Because you've. What would you rate your finance score right now, 0 to 10? Maybe a 3. But I have good income. I do have retirement savings. Yeah. Which is good, but entering 40, you're, yeah, yeah, yeah, yeah. You're where I'd want you to be for retirement. I will say that, so that's good. But we're also sitting like$40 ,000 in a personal loan at 9 % with a minimum monthly payment of$1 ,000. What was this personal loan for? I mean, just the miscellaneous expenses that have added up over the past few years. it's been you know so was where they sitting on credit cards and you consolidated them into a personal loan or like how did this personal loan work when did you say okay we're going and we're taking out 40 or whatever it was at the time thousand dollars and yeah i took out i took out a 50 and a 25 okay and because were there bills yeah because i like i didn't want to you know like I knew that high interest credit cards, I don't want to pay 25 % or some of it was dumb decisions I made in the market, unfortunately.

4:12What did you do in the market? Oh, just playing with options. Ah, shit. I'm just, I can't, I'm not going to. How much did you lose? No, I appreciate that. But how much did you lose? A lot. Probably like 30 grand. Yeah. I have an Amex personal loan, but that one I've actually, I've pounded down pretty hard. Good, good. Because it's probably not reflected in there, but I think the balance is like 9 ,600. I'll jump to it and we can talk about it. Okay, here's American Express then. Yeah. So you're saying this went from$11 ,377 to... Because I've been paying extra on that as much as I can, which is not enough because I know I can pay more.

5:01You can. Right, with my income. You can. What's the balance at today? $9 ,600. Okay. Now the interest accruing on this is just rough on a monthly basis. Yeah. $60. $760 minimum monthly payment. Okay. Yep. So I assume this was taken out for a similar reason. Yeah. What is the Santander? That's a not alone. I'd like to take a brief moment to thank today's episode sponsor. The holidays mean more travel, more shopping, more time online, and more personal info in more places that could expose you more to identity theft. But LifeLock monitors millions of data points per second. If your identity is stolen, our U.S.-based restoration specialists will fix it, guaranteed, or your money back.

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6:59By refinancing your student loans with SoFi, you can begin to focus and plan for your future free from debt. So if you've been struggling with paying your student loans or you're just looking for a way to bank, borrow, and invest all in one app, then visit SoFi.com forward slash Caleb or click the link in the description below. Yeah. What do you drive? So that car is a 21 Lexus NX300. Someone was like, I make six figures. I'm going to drive nice. So this is where we're going to disagree. Oh. Because I'm a car person. Okay. That's my winter car. Winter car? Winter or winter? Winter. Okay, I can't picture it.

7:45Like, I have a summer car. It's a Jag. Kill me. It's paid off. Good, I'm glad that's paid off, but like, we have personal loans, man. I'm not f***ing around with a winter car. And this is where I say, and like, this is where we're probably going to disagree, because you'd be like, sell your Jag. Maybe, but, I mean, dude, I was driving around my 2000 Buick in non-winter tires for many terrible West Michigan where it's like one of the snowiest places in the United States. You know, like top five snowiest colleges in the U.S. or university, at least at one time, I don't remember. But I was just driving around.

8:27I didn't crash. I was just being responsible. But I'm not saying driver Jaguar. I'm saying in the overall situation, we're being irresponsible with our car debt. So this is where I say we're going to disagree because like cars, I know you hate cars. I just don't care about that. I've watched the show enough to be, you know, you're like, Americans love their cars, blah, blah, blah. Yeah, they're obsessed. Yeah. But I am a car person. I go to car shows. I go to road rallies. I've driven my jig in charity events. you know i've taken it on shows like so it's it's more than just like you know get me point a to point b right like it's my passion that's great it's a hobby it is a hobby i have hobbies i don't put it over my financial future right so that's i'm not against cars i think it's a little silly but i think a lot of hobbies are silly yeah and a lot of people would think my hobbies are silly That's okay.

9:28That's just my personal, like, who gives a shit. But when it actually comes to hobbies versus our actual self-interest of survival and personal finance and security, it's like hobbies do not take precedent. Sure. They don't. Yeah. Dude, you're making great income. I say we pay off this debt, try to deal with some of the addiction stuff, and we get, like, three Jaguars eventually. Yeah. Why not? Do it. If you can afford it, do it. You can't afford it. Not right now. Not right now. right now so does that seem like a decent middle ground yeah but this is where i said like we're going to disagree because you're gonna i i have a feeling your opinion is going to be like sell your jag well i don't know because it's probably it's old but it's probably still worth about 30 grand you know and it's driving in charity events it's only worth like 30 grand yeah well Again, this is my ignorance to car culture, but why is a$30 ,000 car exciting?

10:28$30 ,000? It's cheaper than a new Jeep Cherokee. Well, it's almost 10 years old. Isn't that one of those hold value type? I guess not. I mean, it was over 100 new. And now it's kind of getting to the point where it's kind of... Or an investment. no it's not an investment yeah yeah so so anyways but but my point is like why do we have to get a lexus we had to get a winter car why didn't we just get a chunky suv with snow tires being the most important part the problem was then the whole world shut down yeah so now you know after three years i had this car that had 4 000 miles on it it. Yeah. You know, and it was worth, you know, uh, you could probably get like 40 grand for it at the time.

11:28And my buyout was like 32. So it was, it would be stupid to return the lease. So I just kept it and got a loan for it and got a loan for it. What's the interest rate of this loan? 499. Okay. Well, at least that part is stomachable. Don't still don't love leverage I don't love a 5 % loan, but surprisingly reasonable given the current environment. I don't know why they gave me a 5%. You have good credit? What's the term you went? Five years. Don't love that. Usually I wouldn't go over three. Yeah. My credit's 820s. But still, I don't know why they would loan. 820s. That's really good. Oh, okay. You made it sound like I was like, oh, it's fine.

12:22No, it's good. No, I have good credit. I mean, I'm not going to... I know what I have, and I know what I don't have. Yeah, yeah, yeah. But for whatever reason, they're like, yeah, we'll give you a 5 % loan, so I was like, all right, I'll take it. $656 minimum monthly payment. That's what I don't like, is the minimum monthly payments are stacking up quite rudely. Yep.

12:52now we do have a credit card but it looks like we're paying it off the only thing that's hit is the annual fee but spending five thousand bucks is what i really don't like so after taxes and i don't know the state income tax of that situation what do you think is going to be coming home after contribution matches after health insurance shopping is hard right but i found a better way. Stitch Fix online personal styling makes it easy. I just give my stylist my size, style, and budget preferences. I order boxes when I want and how I want. No subscription required. And he sends just for me pieces, plus outfit recommendations and styling tips.

13:29I keep what works and send back the rest. It's so easy. Make style easy. Get started today at stitchfix.com slash Spotify. That's stitchfix.com slash Spotify. or whatever other benefit after state and federal income of the$250 ,000. So if I'm being conservative because it varies, you know, I hit the Social Security max, right, and then I get more each month, right, you know, all that other stuff. Yep. Let's just call it$11 ,000 after tax. Okay. Well, we then went and basically spent what would be half of that on this credit card. Paid off, but we did spend$5 ,000, so let's see. Bath and Body Works, Fire Eden.

14:17Yep, that was my girlfriend's birthday. Yeah, that was an expensive birthday. It was an expensive birthday. It was. Here comes alcohol, and we're door-dashing alcohol. Amazon, alcohol, alcohol. Potential taquitos and or alcohol. Alcohol, alcohol, alcohol, alcohol. Door-dashing McDonald's. It's expensive,$42, but some of these cheaper grocery trips, I'm thinking we're like picking up some alcohol, but I'm not 100 % sure. Or not grocery, cheaper gas stations. I don't know. I have to see them. I don't really like just stop at gas stations. Okay. I mean, I definitely see where you fill up. Oh, more alcohol that we missed there.

15:03I see where you fill up gas because it's more expensive, but either way. Yeah. Apple Bill, Amazon. lego shop lego yeah lego sets are expensive i don't i mean if you want to talk about that but i have a lego problem what yeah i've spent thousands on lego sets i love lego at least that one's fun i know but like if you looked at my house and you saw all these like built sets you're like well actually i'm kind of a nerd for that so i'd probably actually like it But, like, I don't know why I don't do Legos. Like, I feel like I'd love that. Amazon, again, lawn care. So it's biweekly. You could buy within just two months.

15:48You could have a, you know, lawnmower of this. Yeah, and I do have a lawnmower. But I just pay people to come mow my lawn. Again, not opposed to that. If it financially fits, we have bad personal loans. We do not do it. Amazon, Amazon, Amazon.

16:07StockXX,$186. Is that car? No, that's more Legos, actually. Oh. I bought Lego on StockX. It's like a reseller website. DoorDash, Chipotle. That was another Lego purchase. I know that. Mortgage. Mortgage. $520. Yep. What's the house worth? I'd say about$650. Okay, so, okay, equity position. Yeah, it's not, I mean, Minnesota. I love the rate of 2.75. I was going to say, I think you're going to like the rate. Love it. Minnesota has not gone crazy like a lot of, you know, places have. Well, a lot of the places that went crazy, you know, they've seen a dip does not make up for how crazy it went. Right, but like Minnesota is just pretty reasonable, you know.

17:04Yeah. I actually hear really good things about Minneapolis, not going to lie. Yeah. $3 ,139 a month. So, I mean, these minimum payments stack up plus the$5 ,000 we spent on the card. It's our$11 ,000 is quickly gone. Yeah. Actually, it's gone. Like, it is gone. Okay. What's your favorite Lego set you've ever done?

17:33so I built the ultimate collector Millennium Falcon yeah I like that one a lot that's awesome I also built the Rivendell cause I'm a Lord of the Rings nerd I just got chills like I actually just got chills like I started thinking about the music and everything oh man Yeah. That's so cool. That was fun. That's really cool. Yeah. Yeah. I have way too many Legos. If you want to send us a picture, if we end up uploading this episode, if you want to send us a picture of these builds, we'll put it in. Okay. Happy part. $257. And this is within a rollover IRA. Yeah. That's great. Absolutely fantastic.

18:20And it looks like it's, yeah, S &P 500 basically. Pretty much. Yeah. With a little extra. I juggle in some other things, but for the most part, I just put everything in the S &P. Yeah. And just some extra individual things as well. Yeah, I play around a little bit. The majority is in the S &P, which is good. I'd be cautious of the play around just because you have bad history with options. Yeah. I'm good with some individual stocks. Usually I do like 15 % or lower of my overall stock portfolio. and then there was where did it go oh what is this

19:02individuals I have about I don't know what this is I have about 40 45 in just a brokerage account yeah

19:13and then 20 20 in a in a oh this is your Roth IRA Yeah, I have about 20 in a Roth. Do you backdoor every year? Or how do you do this? Well, I was working for a company that they allowed the mega backdoor Roth. Yeah. But I don't have that anymore, and I miss that. The mega backdoor Roth is great. It looks like that's, again, S &P 500, which is great. Individual brokerage. Okay, so I mean in general we have like$300 to$350 in retirement. Yeah, it's about$350. Cool. Well, keep that up. You're on the right track there. Obviously what we want to do, mortgage, I mean that's probably minimum monthly payment until it's paid off because that interest rate just can't beat it.

20:01It's incredible. Even though it is a chunky minimum monthly payment, it's okay. The car, interest rate, hit the minimum monthly payment on a depreciating asset. that Amex obviously want to kill it, and the other person alone, we want to kill it, destroy it, obliterate it. So mortgage, and this includes property taxes and insurance, all that good stuff, correct? Yep. Good. 3 ,139.45. Utilities on average. What are we looking?

20:34Let's call it 400 if we round everything. That includes the internet? no, I didn't actually think about internet. Okay, how much for internet? About 500 with internet. Okay. Because electricity varies, gas varies. Electricity more in the summer, gas more in the winter. Gas more in the winter, and then, you know. Water, trash, all the goodies. Yeah, water, trash. I do, my garage is heated, so. Oh, okay. Is that where the Legos are? No, but... No, that's where the special cars are, right? That's where the... Yeah. They need to be kept nice and warm. They do. Car insurance is... together? So that's bad.

21:27I think right now it's probably about 300 a month. And that shot up because of a DUI. Okay, well, you said you didn't drink and drive. Hopefully, we're not doing that anymore, right? That was 2020. Okay. Yeah. We're not doing... No, no, we're not doing that now. But that was, you know, it stays with you. Yes, absolutely. So once that hit, it pretty much doubled my premiums, unfortunately. Okay. Phone bill? It's about$100. How much do we spend in gas on average? Vehicle gas? I mean, maybe like$150. I don't... Because I work from home, I don't drive that much. Right. Yeah. Well, we saw$200. Did I?

22:33So we had from gas stations specifically, again, so we couldn't tell if we were stopping in and getting some things. No, I don't buy anything from there. Then it was definitely$200. But it's also like I might put a tank in my Lexus and then not fill it up for like six weeks, literally. We'll do$150. We'll do$150. Yeah. Okay.

23:00Yeah. Yeah, so the bull and the drinking, all that comes out close to just about, first of all, grocery stores? Where is that? So anything that says Walmart, I get all my groceries from Walmart. Gotcha, so that was about$4.53. Yeah. Okay, so that takes up a good chunk of the unknown shopping, but still liquor and everything. is about 15 to 20 % of our spending. Oh, wait.

23:36Yeah, about 15 to 20 % of our spending, which is a lot when we make so much and we spend so much. Yeah. And then, like, the body works and the lawn care and the Legos and True Green and the other more Legos, that's 6.3 % of our spending. So, yeah. A lot of our money is going out that could be personal loans. Honestly, these just shouldn't exist at this point. They should be gone. They should be done. There's really no reason that they don't. Let's keep building the budget. Sorry, I got distracted. Oh, we were looking for the gas. That's why. Okay. Minimum monthly debts besides the mortgage,$2 ,455.02.

24:25How do you do groceries? What is that? Is that for you and your girlfriend? Do you guys live together? No. Okay. Then you get$300. Congratulations. That's your new food budget. Probably spend more than that. You do spend more than that. Did you say you probably will? No, I do spend more than that. Yeah, you spent$450 at Walmart. We're doing$300. And we showed that you can get a solid 2 ,500 calories and three meals, healthy meals and snacks, even desserts on a daily basis for$250. my problem is I have a pop addiction so yes a fellow popper soda and coke like weirdos soda is a bunch of oddballs but what do you drink diet coke I like diet coke too I get it I drink a lot of diet coke yeah well just what you can well first of all weaning can help you know like a less can a day one less can a day this is strictly of course for the coke talk but

25:34yeah just as long as we can fit in the budget dude I mean this is where it goes this is budget you're gonna have to just make sacrifices when it comes to the groceries we got drinks and stuff in the budget and then you know still have an extra 50 bucks so okay toilet paper anything else you need to survive for the household, all that good stuff does not include Legos. I'm sorry. That's$100. What else do you need in your budget? What else have we got to put? Other ongoing medical things? Ongoing, no. Prescriptions? Co-pays? I mean, I have a few prescriptions. They're cheap. $25 a month? Not even.

26:13I'll do$25. I mean, literally, I pick up my meds and I'm like, oh, it's$5. Okay. you know okay I'm putting 300 bucks in and it could be more it could be less depends on your health insurance or therapy copays we're starting this we're taking control of our life for the first time oh I've I've spent a lot on therapy over the we're going back to it and we're going to make it a constant thing it's not for you for your girlfriend as well for everyone around you mm-hmm I don't know how checking in a program works for the you know new job and you've gone through it but i would at least start attending group and then work with the therapist who's focused more on the addiction side of things work with them on that i can't help obviously and you don't expect me to but work with that i'm putting that in the budget so you can at least go and start that part of your life because that's just as important if not well it is more important than this side of it as well because there's no point of our dealing with our finances, if we're going to, you know, drink and drive one day, get a car crash die, if our liver is going to fail in our 50s and die.

27:23You know, there's no point of the finance talk if we're just not going to exist. And I want you to exist. So we've got to take control of that first. So I'm putting therapy in your budget. If it's more, it's fine. If it's less, it's fine. What else do you need in your budget to survive that I might be missing? I mean, when I look at, like, the minimum, I mean, that's pretty much it. Cats? I do have a cat. I saw you have a little prescription. So you probably saw some pretty litter and some chewy. So call her$150 a month because she has prescription food and stuff. Yeah. $7 ,519 is a lot needed to survive on a monthly basis, but congratulations, especially with your new job, you're going to be bringing home a lot of money.

28:11Meaning, after that 11 ,000... And like I said, I mean, that's kind of... So, like, the first half of the year, I take home less, and then I hit the Social Security cap. Yeah. You know, and then I take home more, and I just, like, conservative is 11 ,000. Which I appreciate. It's more than that. Okay, well, let's say you have an extra$3 ,500 a month. Yeah. Let's just say that. Just to make it an easy number,$3 ,500. What do you have in a savings account? Do you have a savings account? I don't have, like, a traditional savings. I use my Fidelity accounts. Your brokerage? Yeah. And so, like, I have.

28:55What's it invested in? So, like, I have, like, a layered, like, I keep, like, a few thousand in, like, T-bills, which is like my most liquid, right? And then like a few other things in the S &P and then a few other things and more, you know, so like that's kind of... Saving that money! I love when my money is making more money and the SoFi high-yield savings account I use has 4.6 % interest on that money! It's the savings account I personally use for my tax money that I set aside and other money that I just want to be building while it's just sitting there. And you can get bonuses by signing up all the way up to$250 by using my affiliate link in the description below.

29:36And it's not just because they're my affiliate. I personally use them. They're great. I've had a great experience with them so far. And I only recommend those who I like working with and who I like using. So if you have money sitting in savings, have that money, make some more money and use that high yield savings account link in the description below 4.6 % and bonuses all the way up to$250. Well, some people are going to disagree. This is my organization and just, you know, lack of risk when it comes to what an emergency fund needs to be. I would just take the, I would take, what did you need?

30:14$7 ,519 out. I put in a high-goal savings account. SoFi, that's what I use. That's what I would do. And that's a one-month emergency fund. And then I would leave everything in investing, take your match, of course. what I would do from there is there's no reason why that Amex is not paid off in three months and there's no reason why the other person alone is not paid off in