Buy Now Pay Later: The Data Revealed

21:42Brian Preston:I might get bonuses. My expenses might decrease. I might have other capital inflows that take place. So I want to be careful being all or nothing one way or the other. But I do think seven years is far enough out there that a sinking fund in pure cash, pure high-yield money market, you're going to miss some opportunity there, but I also don't want to go hog wild and have all of it in a brokerage account. And then in the moment when my car dies or when I need to replace it, the market's not at a great spot. I kind of like the 50-50 approach. So let me, let me put it, cause I think Bo's answer's right on.

22:16So I would say if you, if you have the need for the car within the next three years, um, it's, it's a no brainer to do high yield savings account cash only that three to five years starts to become a gray zone where you can start introducing you know maybe we take you know 20 percent 30 percent into investments five years and beyond now you're kind of in the territory where bow is on solid ground is that i think it's okay to have a balanced approach to where you have half of it in investments or index funds and then you can do half of it in liquid you know liquid investments that way just in case you have some flexibility in case decisions are forced upon you sooner than you planned.

22:57You're going to be able to weather it, whether that comes in as the car breaks down in the next few years or even in the next three years you have some market volatility, you have enough time frame, it's going to be A-OK.

23:11Brian Preston:Feel good about that? Good. Love it. Good question, KaiDunto230. All right, let's move on to Newberry Charles. His question is, when's the point you should get a financial advisor? I just hit one million net worth this week. Oh, congratulations. Two comma club. And I want to thank you guys for that too. Been a blessing to learn from you all. Very kind. But big milestone. We always talk about hitting these milestones, investing milestones, cash flow milestones. We've even got some shows coming up on that soon. So make sure you're subscribed here on YouTube. But what would you say to Newbury Charles?

23:47Brian Preston:When should he think about hiring a financial advisor? Bo, there's a big difference between$1 million net worth and$1 million of investable assets. How does that shape the answer? Yeah, because if you had a million-dollar net worth and$800 ,000,$700 ,000, all of it's a liquid portfolio with different account types, different account structures, then I'd argue potentially a financial advisor makes sense. But maybe you've had a million-dollar net worth, and it's because you bought a home and you're in a high cost living area where the value of homes have gone up substantially. And so your$400 ,000 house turned into an$800 ,000 house.

24:25Brian Preston:And there's not, not there's anything wrong with that, but that's a different level and different component of complexity than the other one. And so generally we say that it makes sense to hire a financial advisor when one of three things happen. Can I say the three things? Yeah, go ahead and go through the three things. When one of three things happen. Number one, the gravity of your financial decisions is greater than you feel like navigating on your own. Meaning, man, okay, if I made a 10 % boo-boo on$100 ,000, maybe it doesn't change my life. I'm going to make a 10 % boo-boo on a million-dollar net worth.

24:59Brian Preston:Well, now it's substantial. I just want to make sure that I'm not missing anything. The second point is I just don't know what I don't know. Life has gotten complicated. My taxes are more complicated. My portfolio structure is more complicated. I have access to more accounts. Whatever that thing may be in your world, complexity is entered in and you're just nervous. I want to make sure that I know what I'm supposed to be doing and I'm not doing the things I'm not supposed to be doing. So there's like a complexity opponent. So number one is gravity. Number two is complexity. And then number three is time.

25:32Brian Preston:Often in our lives, as our lives take shape, the important financial matters tend to fall to the back burner. Oh man, I'm in the messy middle and I know I should get life insurance, but gosh, I can't reach out to the agent or I know I need to do my estate documents or I haven't rebalanced my portfolio in the last seven years just because I don't have time to look at it. If you find that really important financial matters are falling on the back burner, a good financial advisor can help keep the important stuff in front of you. So if you find yourself in one of those three areas or potentially all of those three areas simultaneously, that might be an indication that you should reach out to an advisor.

26:09Brian Preston:So does that mean, hey, as soon as I hit a million-dollar net worth, I have to have a financial advisor? No, not at all. And there are a lot of people who will never hire a financial advisor, and I'd argue that's okay. You'll have to decide for yourself, okay, could I get value, or is this something where I would have a greater sense of peace and a higher confidence in my future financial security by having a personal CFO on my side? And Charles, if you realize, hey, I think I qualify or I definitely see a need, I'd encourage you to go to moneyguy.com slash resources. We have the eight questions you should ask anybody you're considering for financial advisors.

26:47Because by the way, we're not all created equally. We just did a React recently where I was like, there's a huge difference between an investment advisor who's only just helping you shape allocation versus a full financial planner who's impacting all parts of your life, whether it's education planning for the kids, retirement planning, estate planning, taxes going through. I mean, I feel like we pay for a lot of our fees by just not doing the tax return, but just making sure that all of your wishes are fulfilled or it's done or recorded correctly when you're following those annual tax returns.

27:21That's the type of stuff that a financial planner should be doing for you. It's outside of even the investments so that you're getting that extra, what we like to call the alpha and the gamma and all the things that when you do look into the research on it, that a good financial advisor actually adds a lot of value to your life and frees up more time.

27:41Brian Preston:Love that. Love that. Update on our poll from the YouTube live chat. Have you seen our latest resource we asked? 61 % said, of course. Nice. Love that. They've gone and downloaded it. 39 % said, going to check it out now. Let's go. That's what we like to hear. But don't leave the stream. Check it out on a do tab and then come back and hang out with us. Oh, you can absolutely do that. But, yeah, we're very excited about that resource. I think it's very powerful and very interesting. It is cool when you see articles written on some of the research and content deliverables that you do, and you're like, all right, this is connecting.

28:17It's connecting with the general public. And I think because the thing I like about this one, because we've always been pretty consistent with the 25 % savings rate, But we've known that the flaw in it was that for somebody who starts super early, you have such a powerful component of your army of dollars because time, being a billionaire of time, I didn't like it saying in the old version that you're going to have 157%. What I like about this is this rubber meets the road. If you're starting early, this tells you, hey, maybe your savings rate goes as low as 15 % in some situations or even 10%.

28:56But if you're somebody who kind of procrastinated, this is going to give you the tough love that you need. So it kind of meets you right where you are.

29:03Brian Preston:I like that it's not discouraged. A lot of people are saying, because we'll talk to 20-year-olds, like, guys, I love your stuff, but I'm never going to hit 25%. So why should I even start? That was one of the biggest impetuses for us. Empetai. Is that the plural of impetuses? Implementing. No, I was just looking for the plural of impetus, like multiple. That was one of the many reasons. That's an SAT word. It was one of the many reasons why we did this one because we don't ever want building wealth to be discouraging. No matter where you are, no matter where you started from, the way your journey begins does not define the way that it ends.

29:41Brian Preston:And we think this deliverable really shows that. It doesn't take a whole lot if you can figure it out early. And I'm excited that we now have one that shows that. Listen, you and I both eat pork rinds. Yeah, we do. So we don't say the words impati or whatever that is. That's not a pork rind type eating person. That's not a pork rind vocabulary. By the way, I love pork rinds, so that's not a compliment or a cut if you like pork rinds yourself. I'm just saying that we're just everyday folks. I'm trying to eat healthier and do that kind of stuff. Really? I know too much. I convinced myself that pork rinds is like a healthy snack because it's like protein, right?

30:16Brian Preston:I don't think it's healthy. I don't think pork rinds are good for you. My favorite thing is that I went to – I have a friend, and he loves his conversation starter, is things that rich people and ultra-poor people have in common. Okay. And there's some funny things, if you've seen people go on that line of thinking. But I actually had an experience where my wife and I were doing a staycation at the Hilton Conrad in Nashville. Okay. And you know how these bougie, fancy hotels or restaurants will do things sometimes, you know, like, uh-huh. I'm on this. Their thing that they brought out to open the meal were like fancy versions of pork rinds.

31:00And then when I was out in Vegas, we had a dinner, and we were at some meat-heavy restaurant, and they brought out pork rinds. And I was like, they don't call them pork rinds, by the way. Right, right, right. It's kind of like grits and polenta. They're all related, but they don't call it. But if you know, you know. That's a pork rind.

31:21Brian Preston:Whenever I see fried bologna on a menu, I'm like, I've... Okay, now you might have actually broken the system. Fancy people have not. I don't think they call... I'm still not in the fancy restaurants yet. I don't think fried bologna has cracked the hollowed hallways of being what wealthy people do. I know when I was a kid, that was like a delicacy. No, it's still good. Was it Roberts? If you're going to the Honky Tonks in Nashville, you still go to the Recession Special, and they will get you a fried bologna sandwich, I think, at Robert's. Have you ever had fried bologna before, Revy? Yes, when I was younger.

31:57Brian Preston:Okay. Are pork rinds big in Ohio? I don't know. I don't think so. I never really had them much. I'm trying to think if I've actually had a pork rind. Oh, well, I guess. Yeah, but I don't know if that's just a me thing or if it's in Ohio. I mean, I literally, when I went down to Augusta a few weeks ago, I literally had a bag of pork rinds. You know how I know she's never had them? On the road trip. Because she ended the word with a D. She actually said pork rind. I don't know if you're listening to me and Brian. We're calling them pork rinds because that's what they are. It's like an R and a Y and an N and just a bunch of N that ends with an S.

32:34Brian Preston:That's how you know. That's how you know. That's how you know. I know another thing we got to do with Rebe. How about boiled peanuts? Have you not had boiled peanuts? Don't make me say it. Have you not had boiled peanuts? How do you know this? No, I think I have had those. But I don't say it like you do. I say it like a Midwesterner. How do you say it? Boiled peanuts. That sounds okay. I didn't say that. Bold. Sounds exactly. I think we're really the same person. Okay. Well, on that note, we are going to do rapid fire after the next question. So last chance to get your questions in. But until then, Skippy has a question for you.

33:17Next to Jeff. I like me some Skippy.

33:20Brian Preston:You're going to love this question. Wait, what? We both were thinking about peanut butter as soon as you said Skippy. That's fantastic. That's hilarious. Oh, man. I'm so hungry. All right. The question, you're going to love the question even more. Are you ready for it? Okay. Brian, I think one of the biggest surprises when you start a business is realizing you're responsible for everything. That's exactly right. At the beginning, you're the marketing department, operations, HR, customer service, all of it. Yeah, and it can be exhausting if you don't have the right systems in place, which is why having the right tools and the right partner can be a game changer.

33:57Brian Preston:That is where Shopify comes in. Shopify is the commerce platform behind millions of businesses around the world and 10 % of all e-commerce in the U.S., from startups to popular brands like Allbirds and Untuckit. And they help you get up and running fast. You can build a great-looking online store with ready-to-use templates and their AI tools can handle things like product descriptions and even improving your product images. Shopify can even help with the email campaigns and social media. So you can actually reach customers instead of just building something and hoping people find it. And everything from inventory to payments to analytics is all there in one place.

34:33Brian Preston:So you're not wasting time trying to connect a bunch of different tools. And that's huge because it means you can spend less time on the mundane tasks and more time building something meaningful. So start your business today with the industry's best business partner, Shopify. And start hearing. Sign up for your$1 per month trial at shopify.com slash moneyguy. Go to shopify.com slash moneyguy. That's shopify.com slash moneyguy. When, if ever, is it better to lease a car rather than buy? At the end of a lease, how do I decide on buying the car or moving on? discuss. Okay, look, the easy answer. I'm going to give you all the easy answer, and then I'm going to level set with you.

35:21You need to be in step eight. Even consider leasing a car of the financial order of operations. But then now let's get down into the weeds on this. Is that I have actually leased my first car because I love my wife. And look, sometimes love is irrational. And you see things for what they are. And I've told you all, you all have heard me. Some of the biggest rants of my broadcasting career have been on her prior European luxury SUV. And to repeat the same mistake over and over is insanity. So I was like, at least we're going to mix this up. And instead of buying this horribly depreciating, expensive to operate vehicle, we're going to lease or rent this bad decision.

36:07So that's what I've done. And by the way, she is as happy as she can be with that car. And she does look good. I pass her on the road in it every now and then coming in and out of the neighborhood, going and doing things. I'm like, she looks good in that thing. But we're going to be able to get rid of this bad decision before it actually starts showing its warts.

36:25Brian Preston:So the question is, when, if ever, is it better to lease a car than buy? And so what we're asking is a comparative question, not an absolute question, because I would argue that auto leases are not a very sound financial decision. But there are consumers. I agree with you, Brian. In step eight, that's where it should happen. But we have people, and I have someone in my life, it's a relative of mine who I love incredibly dearly, and she sent me a text message the other day, and she said, hey, look what I just got. And it's a brand-new car. And I'm like, whoa, whoa, whoa. Why are you going to do it?

37:02Brian Preston:Your car's not that old. You just got that other car like three years ago. And she's like, well, guess what? I took it in for some service, and they made me a deal I just couldn't turn down. Would you believe that I actually have a lower payment now? It's all on the payment. And I borrowed it for even less time than my last car. And I'm like, no, all you did was reset. And so I kind of walked through and explained the mathematics to her. In the situation where someone is trading out new cars every two, three, four years, If you are a buyer and you're buying those cars, all you're doing is paying for all the depreciation up front.

37:38Brian Preston:You just keep paying it over and over and over again. So if you're going to be that kind of consumer, there's a mathematical justification that leasing a car may actually be more advantageous than you buying the car, paying the depreciation, losing the value, rinsing and repeating. Now, neither of those are good choices or good decisions, but that's a scenario where if that's the kind of consumer you're going to be, you'll likely save yourself some money by making that poor decision slightly better. Yeah. By the way, this vehicle that we are renting, it depreciates like a rock. Because I don't think anybody – by the way, you can go buy this luxury car, go look at these vehicles seven years in the future, and you're like, why are they giving these cars away?

38:23It's because they have air suspension systems that definitely are going to need requirements. They're over-engineered, and they create a lot of trouble. So that was my thing was that they depreciate like a rock, and then I knew the maintenance. Because, by the way, this one that we have, it's not only an over-engineered car. It has an electric battery in it too. It's one of those plug-in electric hybrids with a motor in it. And so that's why it didn't work. But I'm also being told, we're getting a mid-question update, that Skippy, not Jeff, is in step three. So without a doubt, you do not need to be leasing a car.

39:02You need to be, if you've got high interest debt, you need to get something that gets you reliably from point A to point B. It's not to maximize the love in your relationship or how cool you look out there to society.

39:16Brian Preston:You've got to figure out how to get your transportation costs down to as low as reasonably possible. I don't say as low as possible because I'm not specifically an advocate for like the go-buy$1 ,000 clunker. I think oftentimes that can be more expensive. But buy the lowest priced, most reliable car that you can to get your car payment or to get your transportation costs as low as possible because you need all of that margin right now to be going to step three, knocking out that high interest debt. Car leases and buying new cars and replacing cars, not where you need to be if you're in step three.

39:51I've got an update coming out to some things I'm not ready to share at all, but I've been writing a lot and Ruby knows she's read it. but timing of major purchases definitely matters. And if you're only in step three and you're a young person, you need to make these type of decisions. That's why step eight is going to be there to protect you. But most people are going to reach step eight until their wealth multiplier is in a completely different place. So don't make fake purchases in your 30s or 20s. Let yourself actually have some success so that you can buy in those abundance goals. and maybe that's when you reward yourself with the fancy car.

40:27Yep.

40:29Brian Preston:That's great. Skippy, thank you for the question. We're glad you're here. I think Skippy said they're new here. So, hey, welcome. Skippy, if you've not subscribed, subscribe right now, so that way every time we put out brand new content, you will get updated so you can continue to do money better. Love it. All right, it is time for It Does Not Depend Rapid Fire segment where Bo and Brian will answer your questions in 30 seconds or less. And I will give them the opportunity at the very end of the segment. Since they can't say it depends in the answer, in the 30-second answer, we'll give them a chance at the end, or maybe it does depend segment, where they can expound if they really feel the need to on the questions.

41:19Brian Preston:Okay, so. Are you guys ready? Did you just snore it on air? What is going on? It feels like when we do these, typically I take 25 and you get five. So I apologize. Bo just said the quiet part out loud. You only get 15. Are you guys going to alternate who starts or are you just going to go? Okay. Who's starting then? This is a gentleman's game. All right. Brian's up first then. Oh, wow. Are you ready? No, but let's go. Should I make Bo go first? No, we go. All right. Brian's first. All right. 30 seconds on the clock. Here's the first question. Where does accelerated 401k loan repayment come into the Foo?

42:02I mean, I think that's probably like a three, a step three type thing, because you want to get that 401k loan paid off very quickly.

42:15Brian Preston:Step three, any 401k loan is a high interest loan because of the opportunity cost of those dollars. You should get that knocked out quickly. Very well done, team. Next question. You both used your 15 seconds. I like that. I'm like fishing around the dark and then Bo comes in definitively with an exclamation point and then he gives me still the fist bump. All right. Next question. I'm in the 25 % to 30 % tax rate. How do I determine if I should do Roth or traditional? You need to look at your other accounts. How much pre-tax money do you have? How much Roth money do you have? What is your timeline to being able to need those dollars?

42:59Brian Preston:How young are you? How old are you? And based on the answer to those questions, it'll lean you one way or the other. Yeah, if you're young, Roth IRAs are going to be really powerful, all the compounding growth you get out of that. if you're older and you think your taxes will be lower in the future, you might want to take advantage of traditional. All right. We're covering a lot of ground here within the time limits. Next question. Did we say it? No, no, we didn't say it. I mean, you did skirt right around it, but you fulfilled the requirements. I didn't say the D word. None of them, actually.

43:36Brian Preston:You didn't say any D words. Okay. Next question. is a concierge doctor worth it step eight at 26 years old with 500k invested yes i mean health is wealth and so you should act accordingly especially with the way technology and innovation is going on in medical science right now money is nothing more than a tool that allows us to achieve our goals for me specifically health and being as healthy as possible for as long as possible is super, super important to me. So for that, concierge doctor is justifiable to the cost and something that if you're at that stage where you can afford it, I am a huge advocate for it.

44:15Brian Preston:Nicely done. All right. Next question. If you're the trustee and ultimate beneficiary of an irrevocable trust, would you include said value in your net worth? Principle and corpus is protected from spend down per trust docs. That last part was confusing. If you're the... Stop. You can't stop it. We can start over. That last part was hard to read. So you're the trustee and the beneficiary. You're asking, should I include the value of this trust in my net worth? That's the main question. But there are spendthrift provisions that don't allow me to get to the principal and corpus. That's what it looks like, yes.

44:51Brian Preston:Okay, got it. In that scenario, the trust is an income-producing asset for you, not an actual asset yet. It's likely, if you're the beneficiary, you'll get it at some point in the future. I would treat it like an income source, income statement item, not balance sheet item. So probably not on your network statement. I'll put other footnotes. I was going to say the exact same thing because it's basically promises of future cashflow things. It's so, it's no different than like social security or other things is that there's definitely going to be value for health, education, maintenance, and support, but it's not something that you have access to.

45:23So you can't put it on the net worth. I went a few seconds over.

45:28Brian Preston:He skated right over the time. I stole two from him. It's all right. Next question. New baby. What's the best account option for him and why? Are you at step eight is the first question. If so, then I like custodial accounts for weddings and house purchases. I like 529s for education and priming the pump to make sure your kids are going to be productive with their labor. Love both of those. I do not love people that get really, really aggressive and try for a newborn to do custodial Roth because they're baby's little baby model. I would say stick to 529s or UTMAs. The end. I was going to say, depending on what, but I didn't say it.

46:11Brian Preston:I didn't say it. I didn't say it. I stopped. That's called discipline. That's one of the three ingredients of wealth creation. Okay, okay, okay. You said the D word. Came to it, close to it. I know. I didn't say it to the end. I think points away from that, but we'll let it slide. All right. Next question. I would like to start working for myself soon, next year or two. How can I best plan for my future as I transition from an employee to a self-employed 29-year-old? Who is supposed to go first? You go first. Go. Put on your 3D glasses. There's some D words. You want to have your dream plan, run the scenario for the next few years.

46:52You want to have the down to earth of what you actually think will happen. and then don't skip out on the doo-doo plan, meaning it doesn't go as you planned.

46:58Brian Preston:In addition to 3D glasses, cash, cash, cash, cash, cash, cash is the oxygen you'll need as a small business owner. I would save up more than you think you need so you can give it longer than you think it will take. Wow, well done. I felt like we only had 25 seconds to start that one. There was some misquies. Because you kind of looked at each other for the first couple seconds. All right, next question. Bow, leg day, arm day, or cardio? Rank from favorite to least favorite. Arm day, favorite. Cardio, because then it helps you get ripped. But I love legs, too. So I'm like, I like all three. I'd say one, then it's like a 2A, 2B deal.

47:39Why did that question get asked to Bowen? Is it because he's a giga-chad? And then everybody just assumed, I don't know. Did I say it depends?

47:49Brian Preston:I didn't say that, did I? Somebody just held that up. Did I say it depends? Oh, really? Did they? Did I say it? No, no. I ranked it. You guys. I ranked it. No, we have to say it depends. It is true that somehow you easily could have thrown in it. It depends. If we didn't say the male diaper or the adult diaper, then it doesn't count. Look, I'm not going to screw up a weightlifting question. That's not one I'm going to screw up. Me and the boys, we love our day. Your time is up. Your time is up. We'll come back to it. Are we still doing this? I'd like to come back to this. Because you even got a gift yesterday.

48:21Brian Preston:I did get a gift yesterday. Stay around after a rapid fire segment. I'll tell you about the awesome gift we got yesterday. Next question. When calculating your emergency savings, can you factor in a guaranteed severance from your employer? No. No. Here's why. Being unemployed is an example of an emergency. But what if the emergency you have does not involve losing your job what if it's car goes out hvac goes out medical some of those things where that severance doesn't pay out just because it's guaranteed if you get severed it's not necessarily guaranteed and a lot of guaranteed severances say so long as you're not fired for cause like what if you screw something up or something yeah that was the only thing i was going at is that time's up we're going to bat the guaranteed severance because i was i'm on the I'm on the same page as you.

49:18Brian Preston:We'll come back to it in our next segment. Okay. Next question. Wife and I are age 35 with three kids and eight times our income invested. Wow. Our dream home breaks the home buying rules and will cost five to six times our income. Since we are ahead of the curve, can we buy it? You've got to stress test this to see because being ahead of the curve does give you flexibility. Now, what I don't think you can do is allow your monthly note to be exponentially above the 25%. What you may be able to do is decrease your savings to build up the down payment to then be able to afford the home and get inside the affordability.

49:58Or even go see how ahead of the curve you are and be honest with yourself and maybe use a little bit of capital to increase your down payment so that that payment does reach within our 25%.

50:11Brian Preston:We're coming back to this one. I am very impressed that you actually got a good answer there in that 30 seconds, though, because that was a doozy. There's a lot of, it depends in there. Okay, next question. Is slowly investing$50 per month in a cloud storage and AI-focused fund like FSPTX too non-diversified? Currently investing roughly$400 per month at 23 years old. Am I too bullish? $400 a month at 23. You're up. Look, we've been there, done that. I did the internet fund when I was your age, and I made money immediately and then ended up selling it at a loss eventually. So I still like nothing wrong with you dabbling it, but just don't let it be your eating money.

50:56Brian Preston:I want to know what else you're saving because at$400 a month for a 23-year-old, if you were just a ploppet in the S &P 500, go play with a wealth multiplier, see what that can turn into. I don't want you to waste opportunity. Nothing inherently wrong with those sector plays, but that's more the vacation stuff, not the main course. That's more like the dessert, not the main course. There you go. I'm over. She didn't call me. Thank you for taking a sip. She missed it. It was slightly over. I don't know why I had grace. I think I was just looking at the next question, which is our final question, last but not least.

51:27Brian Preston:Star Wars or Star Trek? And why? And does Bo know the difference? I mean, we just came through May the Fourth Be With You. So, I mean, I'm going to choose Star Wars. and they've made it easier with the way they've handled the Star Trek franchise, but Star Wars. I would say Star Wars also. Because you know more about that? I do like them both, though. And I hope that, I think the next decade's going to be good for both franchises. I really do. So optimistic. They're still adding to both of them? They're still doing more stuff? I think so. Yeah, there's things in the works right now. Star Wars at Disney, like the whole thing or whatever, wild.

52:10Brian Preston:I was very impressed by that. Like the whole, it was just, you do feel like you're in a different, like in a different universe, man. Very fun. Well, that concludes our It Does Not Depend rapid fire segment. Now it's time for our Maybe It Does Depend segment where Bo and Brian get a chance to expound on any questions they didn't have enough time to do. So I have one where you said you definitely wanted to come back. It was talking about calculating your emergency savings. Can you factor in a guaranteed severance from your employer? Did you have anything else to say on that? Yeah, that one is, look, the reason you have emergency reserves is to keep you from making desperate decisions.

52:50And part of what makes desperate decisions is your employer's cash flow coming in. And, yes, they might tell you we have a guaranteed severance if we ever separated ways or we went out of business. But I bet if you read the fine print, you'll see exactly what Bo said is you're still an at-will employee in a lot of cases. there's lots of outs for your employer and we're trying to build independence outside of the obligations or your employer so that means you need to stand on your own feet i love that um

53:18Brian Preston:i i don't have anything to add to that because i do i agree that like emergencies are the things that you're not counting on they're they're the things that can come out of left field on a random tuesday uh i think your emergency fund should be a true emergency fund and you should not try to find ways to shrink it or minimize it. Set it, let it hang out there, chisel it away, compartmentalize it, and then get under wealth building, but don't sacrifice it. Don't try to get too cute with it because when you need it the most is when you will be the most thankful that you actually have it there. That was guaranteed severance.

53:59Brian Preston:There was another one. Yes, about buying the dream home. They have eight times invested. their 35 with three kids. I know you have more to say. Yeah, because here's what, all right, so this is, I'm going to reframe this for those of you that just got here. This 35-year-old couple, they said they got eight times their income saved up in their investment portfolio. Well, we say that by the time you get to 40, we want you to have six times your annual income. So, they're like well ahead of the curve, like well, well, well ahead of the curve based on like sort of the, I'm going to say the averages, but kind of based on the milestone trajectory.

54:32Brian Preston:What I'd want to figure out is, okay, well, what goals are you ultimately working towards? Like, what's the future? Because money is nothing more than a tool that allows us to do the things we want to do. One of the things that might matter to you at 35 is, my kids are young. We're young. We want to have our dream home. There's no point in us waiting until we're 75 years old to finally be in our dream home and not be able to enjoy it. And because you're so far ahead of the curve, if you are ahead of the curve, because of all the hard work you've put in, you give yourself some latitude and flexibility to make some different decisions that other people who have not been as diligent might not be able to make.

55:09Brian Preston:So I would figure, okay, are we on track for retirement or financial independence, whatever we're working towards? If we were to decrease our savings in order to save up for the down payment, in order to afford the house, what would that look like? And how much would that change our trajectory? Because what I don't want you to do is be so far ahead of the curve. and then you make this life decision and then you end up drastically behind the curve. You got to make sure that doesn't happen, but I'm all for people living their absolute best life today so long as they're not sacrificing the ability to also live their best life in the future.

55:42Well, and I think that's the balance you just said. They're ahead of the schedule right now. Nothing wrong with you running scenarios where you take a little bit of that capital to boost the down payment so it fits within our 25%. but then also run it the other side to, if you're planning on leaving the workforce at 55, 60 years of age, let's make sure what do you need to have so that you don't cut it to the bone. We want you just to basically have a little, you're cutting a little bit off of out of your resources to make this life goal happen, but you're not cutting it so close that when you prune the bush, that it actually doesn't grow back.

56:20So that's the delicate balance you have to do. Nothing wrong with you pruning and using your assets to live your best life. Just make sure you don't cut it so low that you've now jeopardized something that you were ahead of the curve and even potentially on an easy street for life.

56:34Brian Preston:Now, this is one of those areas where when I hear this question, the word immediately comes to my mind is, man, you're making a big decision that likely has a lot of gravity to it. Man, the consequences of this decision, if made correctly, can be huge in terms of how much life we get to enjoy. If made poorly, it could be detrimental in terms of what it costs. There are extenuating factors where maybe you don't know what you don't know, and you're unclear about what variables and how to test it and how to stress test it. This is one of those things that you may very well be at that point in place.

57:08Brian Preston:where having a professional, having a guide, having an advisor on your side, helping you navigate and weigh this decision and how it might play out and what it might look like could be hugely valuable. It's one, to either validate or devalidate the decision. And then two, if it does work, to give you the encouragement, yes, do this, yes, it's okay, yes, spend the money, live the life, make the improvement. Sometimes it's great just to have someone in your corner giving you that confirmation that, okay, I can do this and I'm still going to be okay. Great thoughts. You know, you mentioned your 25 % rule on housing.

57:47Brian Preston:If you're curious about how to stay within the MoneyGuy guardrails to buy a house, go to moneyguy.com slash resources. We have a home buying calculator and a home buying checklist that you can download. Both of those are completely free. It'll give you some more insight on our 3-5-25 rule for buying a home. and I think that you'll find it very helpful if you're thinking through how to do this the smart way and even some of these more advanced areas of like how can you get it within that window in the situation we just talked about where they had some cash and some things to consider. So moneyguy.com slash resources, just wanted to throw that out there.

58:24Brian Preston:Before we dive into a final question, if you guys are ready for it. All right. Oh, no, I got one more. You didn't do that. Your workout thing. Your workout thing. Oh, my God. I was ready to get back to personal finance. Sorry. I still think we should answer one more, though. Yeah, I just want to say, it's so interesting. This is a both-and situation. Obviously, this is a personal finance show, but we care about health. Obviously, we talk about it a lot. Brian has made tremendous strides for his health over the past couple years. I've tried to do the same thing. Because health is wealth. It matters.

58:55Brian Preston:We want to be able to live as long as we can, as well as we can. And so I'll work out every morning with some dudes. We call our gym third base. It's the dudes at Third Bay that work out. It's so funny. We talk about this sort of casually enough and tangentially. You guys catch on to it. And so yesterday, a package shows up, and our administrators open, and they say, guys, what did y 'all order? What did y 'all order? And I kind of thought, Brian, what did you order? And he looked at me and said, what did you order? And we opened it. And it turns out it was one of you actually said, hey, guys, yeah, here's a picture of it.

59:24Brian Preston:That's it. You guys said, hey, I just love so much that you guys talk about how health is wealth. and I happened, here's my, the guy that wrote, he's one of the owners of this company, said, hey, I made some really good financial decisions and I was able to become an owner of this company and I just, you guys have added so much value to my life. I want you guys to stay safe when you're lifting and they sent us a bunch of workout gear. I just think, I think that's awesome. I think that it's amazing that you guys recognize that the stuff that we talk about here, the financial stuff and even some of the other stuff, it really is about living your best life, the best version of yourself that you can be.

1:00:00Brian Preston:And so he sent that, and he sent an incredibly nice letter and write-up with it. And I just – that's awesome. That kind of stuff makes us so happy. That's the first time I saw the poll results. How was that not like 95-5 %? Who thought I was going to get excited about those things? We put a poll on Instagram, at Money Guy Show, if you want to follow. I do. When I go to the gym. Who do you think is more excited to use the equipment, Brian or Bo? And it was like a pretty high – well, I just – It was like 60-40. Yep, 60-40. Yeah, you wouldn't be excited. You're not excited about the – Beau, I think we know who actually lifts weights to where they need a belt on versus – and then you even knew what this stuff was.

1:00:40Like, oh, this is – you can do muscle-ups and pull-ups. I was like, I don't even know what that is. And then Marcy and I had to go and look at the ankle thing so that you can strap more weights on. What I don't need when I'm doing a pull-up is more weights. I mean, I'm trying – I'm giving it all I got just to get what I got up. I don't need to add more to it.

1:01:01Brian Preston:I agree this is a very bow-coated package we received, right? But Brian believes health is wealth, too. You've had a good one. You are very health conscious, very active. I just believe in co-ed classes where we're doing a lot of cardio. We're doing some dumbbells. We're doing the treadmill. But we're not out there doing Olympic lifts. Just trying to throw you in there, Brian. As a matter of fact, on days that I find out there's burpees, I'm like, oh, maybe I need to go to the restroom. I'm going to go walk today. Or get a water break, you know, doing that burpee segment. That's hilarious. Oh, that's good stuff.

1:01:30Brian Preston:No, I'm glad you went back to that. That was good. All right. Do you want to do one more question? Final question. This is a fun one. It says, hey, Money Guy team, if you could go back in time, is there anything you would start spreading the word about earlier? And I'm thinking personal finance related. Yeah. Of course. You know, well, I have one, but you want to go first? I have one immediately that just hit me. Well, I mean, realize, I mean, I really do love, index funds and Roth accounts are something I'm pretty passionate about. Yeah, but I'm going to say you've always been passionate about those.

1:02:06Brian Preston:So for those of you who don't know, Brian started this podcast back in 2006, 20 years ago. Honestly, you started sharing things you were passionate about pretty early. Yeah, and so he was sharing index funds and Roth accounts. Here's something I wish we could go spread the word about earlier. It wasn't until a number of years into our career that we actually synthesized and figured out a clean way to communicate the financial order of operations. It always kind of existed. It was the amalgamation of our experience and working with clients and being able to put the information together. But it wasn't around in that form in 2006.

1:02:45Brian Preston:And man, if we could go back in time, I think it would have been cool starting in 2006 if we could have started like – The purity of this is much better because there's lots of – you talk about 10 ,000 hours to become an expert. There was a lot of really getting in the weeds to get this tied up. The origin story on the financial order of operations, if you remember, was the 30-minute financial plan. We did that show every year. That probably came about, what, because you were on the show then, Bo, so it was probably 2010. Where the food came on? No, the 30-minute financial plan. That was probably like 2011, 2012.

1:03:22And then we kept doing that show. And then finally we were like, you know what, we go through the mindset or the order. And then it hit us when I saw that LinkedIn post on the, please excuse my dear Aunt Sally. And I was like, you know, this is, we ought to own, because there's a financial order of operations as well. And I agree. That would have been better even if it came out even sooner.

1:03:43Brian Preston:I do love that though, because it goes to show you like the financial order of operations, truly baked in like tons of your life experience, tons of your client experiences. Like it was a long time in the making. Um, well, that's why, that's why I love, you know, and by the way, this is probably a great way to close it too. And I still am reading the Amazon reviews. I mean, and the good reads reviews, cause a lot of you are like, I don't know. I wonder if he's still reading or yeah, I'm in there. He doesn't scroll his phone. You guys made me so happy because I mean, it feels like the book as well as the financial order of operations are changing folks' lives for the better.

1:04:20And I know that that's all driven by what we get to do with y 'all in the wings, whether that's in the theater or on the airplane.

1:04:28Brian Preston:Either way. And I appreciate y 'all being my, you know, co-pilots with me while I ride in first class.

1:04:37Brian Preston:That's true. Am I a co-pilot or am I the pilot? You're the pilot. Okay, so you kind of like stepped out of the cockpit and said, here, Reby, I'm going to go sit in first class for a while. I would say this is a private jet so that you're not locking the cockpit to make sure we don't come up there. We have free access to come from first class up into. Okay. Or we're like Southwest where all seats are first class. Every seat on Southwest is first class. Wow, this analogy is getting way too deep. But I do like it. I appreciate everybody being in the wings so that we can make this show for you. And we'll be back every Tuesday at 10 a.m.

1:05:11Brian Preston:Central live streaming along with lots of other original content throughout the week. So be sure to subscribe wherever you're listening. And we will continue to show up here on the Money Guy Show channel with brand new content talking about what matters to you, about your personal finance, and hopefully just helping you build that confidence so you can focus on what really matters and not just stay in the weeds or in the anxiety of personal finance. That's what this is all about. So be sure to subscribe and visit moneyguy.com slash resources for all that free stuff we talk about that we have made for you to help continue these conversations.

1:05:44I'm your host, Brian, joined by Mr. Bo and the rest of the Money Guy crew. Money Guy, out.

1:05:51Brian Preston:The Money Guy Show is hosted by Brian Preston and Bo Hansen. Brian and Bo are partners with Abound Wealth Management. Abound Wealth Management is a registered investment advisory firm regulated by the Securities and Exchange Commission in accordance and compliance with the securities, laws, and regulations. Abound Wealth Management does not render or offer to render personalized investment or tax advice through The Money Guy Show. The information provided is for informational purposes only, may not be suitable for all investors, and does not constitute financial, tax, investment, or legal advice.

1:06:23Brian Preston:All investments involve a degree of risk, including the risk of loss.