Die With Zero? Watch This First.

22:40And if you think you're going to leave the workforce early, you know, before 55, especially before 55, man, you better have access to some capital because those retirement accounts, you might be retirement rich, meaning you have a ton of IRA and 401k assets, but you're still financing cars. You don't have any money to do all the things you want to do. That's where step seven is going to help you out is because you actually start thinking about how you're going to use this money, live your best life. And you're back, wait a minute, if I'm going to get access to this money at 52, 53, that's not going to be an IRA.

23:12That's not going to be a 401k. I probably need to start doing a portion of this into after-tax brokerage accounts, still investing the money, but now you can get creative and say, okay, well now what's the balance between how much goes into a Roth IRA, how much goes into my employer plan? We definitely want to get the match, but now maybe we want to start loading up that after tax just so we build that bridge account for early access to the money when you need it.

23:40Brian Preston:We actually, we did a show, Justin, you're gonna have to help me with the name of this one. It was four ways to retire early that you may not know about. Is that right? Or it was a number of ways to retire. And in that show, we walked through a rule of 55. We walked through 72T. We walked through Roth conversion ladders and we walked through building up a taxable account. So there are PJ, there are things you can do and strategies that you can implement, but I will tell you this, the earlier you figured out, the earlier you start thinking about it, likely the better of a plan you're going to be able to build and the more flexibility you're going to give yourself.

24:12Brian Preston:So if you're not gone to listen to that show, maybe put a link in the comments below. Three? Three ways? I just named four right there, so you just got an extra one. Three ways to retire early that you may not know about.

24:27Great.

24:28Brian Preston:Okay, that was an abrupt ending, but PJ Dadlife, thank you for your question. By the way, so my watch is blowing up over here is because we have a guest in the studio that's a neighbor of mine. And my wife is like, make sure everybody says hello to, so I just want you to know you're causing trouble for being here today, Lucas, just so you know, because my watch is blowing up because my wife is over here. I guess your mother must be talking to my wife and it's, it's causing issues in a good way. Well, shout out to the, I think you did say his name, The mysterious guest. Lucas. All right. Next question is from Ben B.

25:08Brian Preston:Good morning. I am fairly new to your content. Welcome. And I'm currently in step four of the Foo. All right. The transmission began going out in my vehicle last week. Do I pause step four to save for 23.8? Well, you see, what's really, really interesting is if you're in step four, I would not say that you're pausing step four to save up for the 20 % for the 23A. For those of you that aren't familiar, we have a car buying rule. When it's time to buy a new car, we want you to pay cash if you can, but if you can't and you have to finance, 20 % down, don't finance for any more than three years or 36 months, and your payment cannot exceed 8 % of your monthly gross income.

25:49Brian Preston:So you got to come up with that 20 % down payment. I would argue if you're in step four already, You just want to keep doing that. You want to keep piling money away in that emergency fund, recognizing that even part of your emergency fund is likely going to be a sinking fund to cover that 20%. Now, it's going to mean that you're probably going to be in step four for a little bit longer than you would have been otherwise, but that's okay. That's what it's there for. That's what you want to be able to use your emergency fund for. So I don't think it's a pause. I think it's a continuation of it.

26:19Well, it's not a pause. It's a use. you are saving into step four. So then you can use step four, your cash reserves to put that 20 % down. So it's not a pause. It's a use of your cash reserves because your car is about to leave you stranded and you need the car to get you to your J-O-B, which is the primary engine that's going to help you build wealth in the beginning of your humble start to the journey. So that's why I don't think you're not separated from the financial order of operations. It's just part of it. That's why I love how these things interconnect is that you have the nine steps, but then you also have some of these guidelines we give you with 23.8 as well as house purchasing guidelines.

27:03It's because these things all intersect with each other. You just need to know how to use the money and know where the limits are so you don't get yourself in a bad situation. Now, I do want to kind of close it out with when you use your emergency reserves to put this down payment on the car, you should feel a little scared that you're naked not having as much cash reserves as you should to keep you financially safe. Use that fear to keep you motivated, to stay disciplined, to either, you know, there's the two levers. You can make more money or you can spend less money, but let's get the cash reserves boosted up because that is your protection from the desperate decisions.

27:37Let's get that built back up as fast as possible.

27:40Brian Preston:I love that people People sometimes don't think this is live. And what Ben saw, he answers questions. Like, oh, my gosh, this really is live. Yeah, he was like, what? They're really answering? Yeah, this really is live. We really are. Well, he said he was new to our stuff. So maybe he thinks that this is all, you know. This isn't pre-recorded. Out there in fake land. And we really are taking questions live. We're picking them from the chat as we speak. Thank you for the question, Ben. And good luck on step four and all the potential car buying. This episode is brought to you by Google Chrome. You think you know a browser.

28:12Brian Preston:But Gemini and Chrome, that's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required, compatibility and availability varies 18+. This episode is brought to you by Accenture. When your advertising operations fall out of sync, everything else follows. Spotify and Accenture are working together to reinvent the rhythm of ad sales, using automation, analytics, and smarter workflows to simplify campaign delivery and access better data across the business.

28:53Brian Preston:The result? Less time spent on operations, more time connecting brands with the moments and fandoms that matter most. Learn more at Accenture.com slash Spotify. Okay, next question. And you know, before I get to the next question, we're going to be doing rapid fire in just a little bit. So be sure to get your rapid fire questions into the chat. Just put RF at the beginning of the question if you want to be a part of that. Did you do rapid fire last week? No, we did Waiting in the Wings or something like that. Yeah, from the wings. I will tell you, Bo, because Bo, I like to let everybody know how smart Bo is.

29:27Yeah, I like this too. I did that, you know, it was just me and Reby doing the show. And if you go read the comments, we had a great show. Reby and I crushed it. But there was one question that I just completely whiffed on, I guess. Oh, the raw fire egg question?

29:39Brian Preston:Yeah, I saw that. So I was thinking, I was like, this is why Bo and I are such a great team. Because I probably, in reality, I whiff on a lot of them. But Bo just comes. He's like the janitor who comes up behind me, cleans it up, makes sure that it's all good. So it's nice to have you back in to sweep up behind me so that nothing gets swept up. Good to have our janitor back. That's what I heard. Brian just dubbed me the janitor of the Money Guy show. That's, man. You're the cleanup or a cleanup hitter. There you go. You're a baseball guy. I've been doing it for 20 years. I'm the jam. I do agree.

30:11Brian Preston:It's nice to have you back. It's always, it's an honor to sit at the big desk, but I prefer when we're all here doing our thing all together. So, all right, get those rapid fire questions in and we're going to move on to Thomas's question. He says, we recently purchased annuities that will provide a healthy paycheck in retirement with that large sum spent. How should we think about our net worth now for continuity of tracking? Oh, man, this is a hard question to answer, Thomas, because annuities are fairly complicated because we don't know what kind of annuity you bought. Did you buy some sort of deferred fixed annuity?

30:48Brian Preston:Meaning like, okay, I paid$100 ,000 into this annuity. And at some point in the future, it's going to pay me a fixed return to create that paycheck. Or is this like a variable annuity where we put into annuity product and it's still investing. And so the future payouts are going to be dependent upon how the underlying assets perform, it's really, really difficult to give you guidance on exactly how to account for that in your net worth. Because some annuities can be kind of like pensions, guaranteed future income stream. And other annuities can be like present day assets. They fluctuate with the market, go up and down.

31:20Brian Preston:And so you don't know what that future income stream is going to be. So you have to, you need to really understand what is the product that you bought, and how would you market it or how would you market to market based on today's value if you were going to clear your estate? Well, but I don't mind speaking to if it's a fixed, like an immediate annuity that's not going to provide like a pension to you so you could take the risk off of you and put it on the insurance company that's doing the annuity. I think that if you did that, now I will tell you, that's a very small subsection of the marketplace.

31:54And in my opinion, my opinion, probably the most appropriate way to use annuities is because if you want to take some of the risk off of you providing in the future, because then that frees you up to you can think about legacy. You can think about other things on how you're using the money because you've essentially purchased your way out. Now you no longer own those assets. Now you've created a promise from the insurance company to provide this income stream. So from a net worth standpoint, that money's off your net worth statement. It's more of a footnote now that's a promise of that you're going to be receiving this type of income flow for many years to come.

32:28No different than when your employer has a pension. If there's not like a rollover opportunity, it's only a promise of future payments, just like Social Security and other things. Those are essentially help you offset your cash flow in retirement. But now it's off of your net worth statement. Now, if these are -

32:46Brian Preston:This is immediate payment for both of our entire lives. So see that? That's probably the best use of it if you want to take that risk away. Thank God I saved it. Did you see that? There's almost a lesser athlete that would have been able to do that. I'm like a cat. I was laying it on my feet. But it is one of those things. So if it was an immediate purchase for that, now you can start thinking about how you want to use the other resources, both from an investment standpoint, from a legacy standpoint. It really opens up. But realize the catch with that when he made that decision, when Thomas made that decision, the legacy of the portion that goes in the annuity is gone because you wanted to take the risk off of you.

33:25But the problem is if you died quickly, that money doesn't get passed on to your relatives and others. But for a lot of people, that's an okay thing. You see this with a lot of assisted living communities. Have you seen what a lot of these assisted living communities are now is you can buy into essentially the house. You don't get to keep it, but now they kind of promise you that they're going to do your health care and all these things as you work through later life decisions, you can buy yourself out of some of those risks if you structure it appropriately. That's right.

33:58Brian Preston:Great question, Thomas. Thank you for being here and for asking. I better drink this coffee before I knock it over. I know. That was a good save. People are commenting, saying that we have an obscene amount of drinks on the table today. It's always both, by the way. I think it's the same number of drinks we always have. But it is just a lot. Huh? It is the same number of drinks you always have, but it's collectively a lot. I wrote a comment last time somebody posted that, and I have coffee, water. I don't know what Bo's doing over here. He's got coffee. He has two kinds of water. I have bourbon.

34:29Brian Preston:I have my beer. No, I have coffee. I have sparkly water, and I have still water. So when you go to a restaurant, they go, sir, would you like to have flat or sparkling water? You go both? I say tap because you know what they have to do. Why do we have both here then? If you want to know the financial mutant, when they ask you, sir, would you like sparkling or still? Don't answer that question. It's a trick question. What that means, you're about to pay nine bucks for a bottle of water. What they're really asking, sir, do you want tap water? And the answer is yes, I would like tap water. There you go.

35:00Brian Preston:It drives me nuts. That is such a financial mutant thing to say. You want to know what cooks my gizzard? It's that right there. When I get charged for water and I don't expect to get charged for water, it gets me. Yeah, you know, a much younger version of myself. First time I ever went to L.A. I about got in a fight with a waiter out in the parking lot over this exact equation. I believe that. No, he followed me out in the parking lot and we had words. Are you serious? I'm not going to tell the rest of the story. What? It was an intense situation. Because I had written a note on the receipt because I felt like he ripped me off with all the bottles of water that he charged us.

35:38Brian Preston:Oh, so it was like in multiple, like not just one. Yeah, because, you know, and look, you can't even tell if they're serving you tap water versus because they all use these fancy little, you know, in most places. Like, look, we go to Disney all the time, you know, and Florida has horrendous sulfur water. Sure. But somewhere in the last, I don't know, two years, three years, they filter everything now because now you can drink Disney water in the restaurants and it doesn't taste like eggs anymore. Really? So you can do, well, most restaurants, I think, are filtering their water. so it's okay to do tap water just like Beau said.

36:15But it wasn't always that way because I will tell you, Florida was the exception for me. I used to buy bottles of water at restaurants because of the sulfur taste, but somehow they fixed it.

36:24Brian Preston:Yeah, if they have like gross water, I'd get it. But if it's like fine tap water for one meal, I'm going to be okay. Florida, the state of Florida, look, I love Florida, but that is one of the things, that egg water, it's something. well that was a great exploration of the types of water i got this restaurant you know the rest i got charged for the ice cube i gotta i got like oh yeah i know no i know exactly all you have to tell me is the ice cube it was a three dollar ice cube yeah at that restaurant which is funny and we'll get back to answering questions that restaurant you can order a mixed drink that will still have that big ice cube and they don't charge your premium but if you do like a bourbon, they hit you not only with the charge for the expensive bourbon, but they hit you for the ice cube too.

37:12That is crazy. It's a crazy, you know, stick it to you moment. It's frustrating.

37:17Brian Preston:That's truly crazy. It's frustrating. I know exactly what you're talking about now because I've gotten charged for that ice cube too. They hit me on water. It is ridiculous, but it is hilarious to hear you talk about it. Like, look, I don't, I don't like when they come out. Hey, would you like bread for the table? Because my answer is always, yes, I'd like some. But I don't always want to pay for bread. You know what I mean? Is this like a Longhorn situation or is this like a fancy one situation? Hey, can I tell you there's a great book you might want to read called Die with Zero. We might be at that point that you're getting into Miser territory versus mutant territory.

37:52Brian Preston:Some wise words. A fine line between Miser and mutant. So maybe you need to consider. I mean, when we start hearing rich guys talking about how they don't want to do something, they might need a book called Die with Zero. Look, I don't mind. Worth the memories made. I don't mind spending money. I just like to know that I'm spending it. You know what I mean? We were just down at the beach and it was awesome. My kids, we got all the good stuff and it was fine. But I knew what I was doing. When it's done to me instead of me doing it, I don't like that. And that's why we partner with Monarch. I'm just kidding.

38:27Brian Preston:That's not happening right now. We do partner with Monarch though. Great app. Okay. I have like a, on my Sankey diagram, I can see like the ice cube. I see all the ice cubes on there. There's a specific category just for ice cubes. All right. Next question before rapid fire is from Casey. He says, hey, money guys. My husband and I are planning to start a family in the near future. Oh, congratulations. As parents yourselves, how can we anticipate and plan for this to affect our budget? you know look i'll say this part because i'm i'm like the the grandpa here that you know i'm out of the child rearing ages and or having children ages so now i'm in that sentimental phase i just want you to know well we also had a lunch yesterday bo you weren't at that lunch but we one of our key team members any day now his wife is is having a yeah yeah and we were we were talking about how that first week is when you come home from the hospital and stuff.

39:26And if I could bring it back to the financial side, kids do have a cost. Don't, don't, don't mishears. Kids do have a cost, especially when you talk about daycare. I want you to know that's the biggest thing is start thinking about how you're going to, if you're going back to work or if somebody's staying at home, that's the biggest part. But all the other components of it with the diapers, the food and that type of, it's, it's not as big as everybody would have you think. So figure out the childcare care side of it if you're going back to work. But once you get that part figured out, I want you to have, be fruitful.

39:56Because as a guy who's in his 50s, I wish we'd had more kids. You know, nobody tells you that part of it is you're going to get to an age and say, man, it's kind of sad once you're off of that child rearing. It's hard in the beginning, but there is something about the love that you have for your children that's just, it's hard to explain it.

40:16Brian Preston:I'll tell you what I did. and I think this is helpful for young folks having, you know, having, if you can, meaning if you structure your life in such a way that you have a pretty decent savings rate early on, meaning like you caught the bug of financial mutant dumb and you're, you know, you're saving 15, 20, 25 % of your gross income before you have kids. What you've already naturally done is built in some really good margin. And so the way that I would mentally prepare for the financial impact of kids is I agree outside of like maybe losing an income if one of you stays there, having to pay for like daycare, realistically, the costs are not unbelievably burdensome.

40:52Brian Preston:But what you might have to do, and I see a lot of parents do this. I think my wife and I may have even done this with our first kid. You may have to back down your savings rate a little bit. You may have been so good at saving 25 % or you were at 23.2 % and you were almost at 25, but that kid comes along and now all of a sudden, well, oh man, I need to go buy life insurance. I need to make sure I have disability insurance. I need to make sure I have this covered and that covered and diapers and bottles and all these things. Maybe your savings rate drops down to where you're saving 17%, 18%. That's okay.

41:22Brian Preston:That's going to be something that you will get back on the path. It's okay if you take a step back. It doesn't have to be just a solid, straight walk up the mountain one step at a time. I think a lot of parents are so hard on themselves, but they say, oh, I can't back down my savings. I can't do this. I can't live life. I can't actually enjoy the moment that I'm in. And I just don't think that's the case. And I think a lot of people say, you know what? Well, I can't do that yet. So I'm going to wait. I'm going to wait to have kids, wait to have kids, wait to have kids, wait to have kids. And you have to make that decision for yourself.

41:57Brian Preston:I do not think that having kids and starting a family is a financial decision. I think that obviously the finances play into it, but it should be a life decision that you're making and you figure out how to make the finances work around that. We just heard from the Wings that Casey has shared that she'll be staying at home with the kids. So obviously take into account how that impacts and then embrace. I mean, I will tell you some of my favorite memories, this is part of the blossoming of memories, is those struggles is if you will embrace it as part of the adventure of this, it can be fruitful in the future, but just kind of go into it and know that, hey, yeah, we're going to have to, maybe we don't get to do everything that we did, but in the long term, this is going to be better.

42:44You know, because that's the thing is because Casey's probably trying to figure out is that I would go ahead. By the way, we always say when you make huge life decisions, put on your 3D glasses, go ahead and model out what the next three years of your life is going to look like and put it in three different scenarios. You got the dream of man, oh man, things are awesome. The down to earth plan and don't leave out the old doo-doo dookie plan. With newborns, you're going to know about the doo-doo plan. The dookie plan for sure with newborns. You need to take that into account from a financial standpoint so that you have all scenarios covered.

43:15Love that.

43:16Brian Preston:That got way too good of a laugh from the content team. I don't know if it was a pity laugh or what. Let's face it, no matter what age you are, a good pooper, you know, that type of jokes, they never miss. Okay. With that, it's time for our It Does Not Depend Rapid Fire segment where Brian and Bo have a combined 30 seconds to answer your questions, and they cannot say the words or phrase, it depends. Now, at the end of the rapid-fire segment, if there are some things that need to be said, we will revisit those at the end in our maybe-it-does-depend segment. With that, let's get 30 seconds on the clock, and let's dive into question number one.

43:56You can go first or me can go first? You can go first. You're fresh from vacation.

44:00Brian Preston:That's right. No rest for the weary. Here we go. Is it okay to put all or part of your emergency fund in a CD ladder? You can put your emergency fund in a CD ladder, but you need to have access to capital like today. Like if an emergency happens today, you don't have to wait for that ladder four months, five months, six months to mature. It's okay if you have some portion of it in CDs, but you need readily available cash today. I'd want to know more information on how much are you putting in CDs? because there's a lot of chance your high-yield savings accounts and other things are going to be very competitive.

44:34And unless you locked in some CD years ago, there's just a better way to do it.

44:41Brian Preston:Nicely done. I hold zero CDs right now. I don't mind disclosing that. I don't have any CDs either. That was over 30 seconds, but I'll allow it. Next question. She sits in the big table one time. Gift giving. When it comes to gift giving, do you get an item, a gift card, or cash? I mean the ideal is an item first I like cash over gift cards second but I'm all about can you have a thoughtful idea but I will tell you probably more often than not I give cash cash will be what I'd like to receive the most oftentimes I find myself giving gift cards which is so dumb why would I do something that I don't want to get back but a gift is probably the best thing but man it's really hard to do that especially around the holidays question number three are there reasons to see a financial advisor if you've accumulated a million but have several years left in the accumulation phase we say that there are generally three times when it makes sense to reach out to an advisor one the gravity of your decisions is bigger than you feel comfortable navigating alone two the complexity of life has gotten to the point where you don't know what you don't know or three you recognize that stuff in your financial life is falling on the back burner you don't have enough time to put the effort to it you need to more than likely this is the first time you've ever had a million dollars and you just don't know what you don't know.

46:02Having somebody who's done this thousands of times is probably going to be a more efficient and better use to have that CFO professionally help you.

46:10Brian Preston:Moneyguide.com slash become a client. Check it out. We'd love to talk with you. I'll allow that too. Important. I thought we were about to go micro machines there. I mean, the way you were speeding Ah, man, I got it. You really did nail that until you actually told them how to become a client. Well, I feel like that part's important. I know. I probably would have said it if you didn't, to be honest. They said that a million dollars. You know how unique it is in this world to have a million dollars? It's a big accomplishment. People are like, poo-poo, no, a million dollars isn't that much money.

46:38Brian Preston:A million dollars is still a lot of money. If you hit the Two Comma Club, that is worth celebrating. If you're not out there in our Discord celebrating milestones when you hit that stuff, you should be because it's awesome, and it is worth celebrating. Back to rapid fire. Does the money guy three to 5 % down rule for first time home buyers apply to someone who's 50? Have you ever owned a home? I mean, this is easy because I give you this. We give you this rule for your first home. Now, if this is an upgrade, I want you to do in the traditional choice because hopefully you'll have the equity from your first transaction.

47:15Brian Preston:I think that you can still use 3-5-25. However, if you're 50, one of the things I want you to think about as you're aging is you ought to be thinking about delevering. So if I'm 50 buying my first house, that's time I'm up for a 30 year mortgage. I might want to figure out, okay, is there a way to be in a 15 or something else to get that timeline down? That was close. Maybe we'll come back to it. Next question. Do you have many expat clients for Abound Wealth? We have some. Many is a word, but yeah, I mean, we have expat clients. We have clients who choose in their financial independence, post-work, post-life to go live in another country, live somewhere else.

47:51Brian Preston:Yes. Well, we also have clients who are still in the active growing size that go live in Europe and other places too for a period of time. We have to help them with the tax side of that as well. So yes, they can help with that. Next question. Hey guys, I have a friend. It's me. I'm the friend who has a bit of a spending problem that really is a discipline problem. What tips do you typically give your clients who have the same struggle. I do think using some sort of budgeting or tracking app can help because then you can't ignore it. If you make yourself every single morning, pull up the app, look at the transactions, make sure they're coded, you will start to see, and before you go swipe right, man, I'm going to have to look at this tomorrow morning, it will likely change your behavior.

48:35Automate as much of your life as possible, meaning that you actually make the good habits that much easier by doing your 401k, your Roth IRA, and then every time you get a pay raise, at 60 % of that go towards your savings, only 40 % lifestyle.

48:49Brian Preston:Love it. And if you want that tracking app, use code moneyguy on monarch.com because you can get a big 50 % off discount. There it is. Look at that. I wasn't even going to say it. I wasn't even going to say it. We should not be scared to actually use, to share the tool that we actually use personally. I'm not scared. No, I'm just saying, if you want to take your advice, you can get it way cheaper if you use the code moneyguy. So why not? my wife really is love like she loves being able to see it now she's never had like a mechanism where she could see and she kind of just you know what I mean it's helpful for her to have that in front of her alright last but not least throw pillows or curtains which one to buy first thank you the easy answer is throw pillows because I know how much drapes cost I'm ashamed at how late in my life it took me to buy blackout curtains in my bedroom do that tomorrow.

49:43Brian Preston:Make that step one of the financial... I'm just kidding, it's not. But blackout curtains so you can sleep better, game changer for me and for all my kids. I don't know why we didn't do it for our younger kids. For my baby boy, blackout curtains, game changer. Just go to bed earlier. No, it's for the morning. Because I like waking up when the sun comes up. Yeah, I don't want my son waking up when the sun comes up. Oh, that sucker to sleep. It was wild. As soon as the light came in, my kids... I'm confused. that was one of the you know my kids at the beach at the beach like 6 6 a.m. wake upers right because there was no because there was no because it was sunlight coming through not at home heard it here first that concludes our it does not depend rapid fire segment yes what's your question so what time while y 'all are on this beach vacation what time are y 'all going to bed if the kids are waking up at 6 every morning I mean we were probably going to bed around 9.30 9.30 and with party animals This is the first time we've ever done this.

50:40Brian Preston:And look, I'm not even ashamed to admit it. I'm at this age now. We just kind of all went to bed at the same time. Like as soon as we put the kids down, we kind of just went to bed. That's kind of the way that it went. And it worked out great. There you go. Practically speaking, I do think if you have to choose one, you got to buy curtains, right? Throw pillows are useless. There's no utility in them at all. Like I don't know why you would spend your money on those. There's just much less utility, I think. There's no other than looking at them. Okay, let me ask you this. Curtains have a utility.

51:12I know at home. Hang on, I'm going to do the math. I'm not talking about sleeping pillows, and I'm not even talking about, I'm not counting shams, you know, the pillows that they sit on. Oh, the ones that look like sleeping pillows that you're not supposed to sleep on? Yeah, we won't even count those. How many pillows do you have on your master bed if you don't count even the shams? Okay, not counting those three.

51:40I have eight. My wife is, we have eight pillows.

51:43Brian Preston:How many total pillows do you have? That's not counting the shams? One, two, three, four, five, six. I've got seven total on my bed. Yeah, because I think about now the bed looks beautiful, but we have three of these pillows that are one color, and then we have two little bit smaller pillows in front of those three, and then we have like two more, and then we have one. It's like a pyramid of pillows. Here's what I understand. It's glorious. It looks beautiful. And then we have a bench at the end of the bed, and there's one on each of those, too. And I didn't even count those. So, you know, we did this bat, right?

52:15Brian Preston:We had this, like, back porch or whatever. Well, my wife bought these pillows, and they look like Tootsie Rolls. Not like, but they're like, yeah. They're like these little, like, rolled pillows that they just sit in the chair until you need to sit down. Then you've got to move on the ground. And I'm like, what all these pillows do is they get in the way. They're not serving any purpose other than just taking up room in the seat. We got one on every single one of our chairs outside. That's a great way of putting a Tootsie Roll pillow because I knew exactly what you're talking about, and they serve zero purpose.

52:46Brian Preston:And I bet they were so expensive. How did they convince? That must be a heck of a marketing campaign. My wife bought them from this designer that she buys all her stuff from. If you had a Netflix special, I should not be buying your throw pillows, but that's who she bought them from. So they're pretty. Back to marketing. They're pretty, but all I do is, I want to sit in that chair, but there's a pillow there. Guess I'll move it. You guys are funny. And if you throw it down, do you know how much that pillow comes? I know. Then it's like, I don't get it dirty. What am I supposed to do? Am I supposed to put it in my lap?

53:14Brian Preston:I don't. Now this pillow is causing me problems. I think you're just not supposed to sit on any chairs outside. That might be it. That might be it. See, at my house, if something's going to go outside, I'm assuming it's getting dirty. That makes a lot of sense. You also have two boys. It's a disposable item. Right. You probably just assume everything's. This is just what this is all going to be. It's fine. Okay. Did you have anything else to say about that first time home buyer question or do you feel like you got it all in? For a 50 year old, you know, I would really want them to think about maybe a 15 year mortgage, maybe figure out how to do some sort of extra principle.

53:49Brian Preston:I just, the idea of having a mortgage from age 50 to age 80. Yeah. You got to consider that. Yeah. If you're going to like leave the workforce around 60, 65, something like that. I just, I'd want to know, is there a way to potentially de-risk that a little bit? Yeah, but it's also, you have to be careful. That's such a hard spot that I actually, that's where it's hard to give rule of thumb math on. It's because you actually need to get into the numbers is because I have had clients who've come in because I don't know if I would tell you in certain high cost of living areas that you ought to go if you have a 401k or you have savings of a million dollars, going and paying for all of that house with that so you're debt free is a scary thing too.

54:31It would be fine, yeah. It's really, you have to do the math on it to kind of assess the risk to figure out how do you navigate this and what's the interest rates and what is your situation look like.

54:41Brian Preston:All of our guidelines are very widely applicable, but it is true. Once you get to retirement, it just gets too, like, too nuanced. Well, I mean, the ideal is you're debt-free. I mean, because you're not truly financially independent until you have zero obligations behind you. And so, but for some people, the reality is that you will have a mortgage in retirement. but I want to really measure twice, cut once before I'm willing to say, yeah, this is the best course of action for you. Totally. All right. Let's do one more question before we close it out. This one's from Kyle. Did we only have one?

55:12Brian Preston:Did we answer every rapid fire so well that there was only one? I keep track of what I think you did say enough on. Well, I mean, some of them were questions. It was almost like boxers or briefs. I mean, because they were like, do you throw pillows or curtains? I mean, these are not exactly thought-provoking, crazy, crazy answers that need follow-up. All right. Next question is from Kyle. It says, thoughts on paying off a 5.625 % mortgage by 35, assuming all retirement accounts are fully funded and hitting milestones. I want to hit Coast Fi or Fine to have more time with family. We are 30 and 28.

55:52Brian Preston:Right. This one, this pains me a little bit, right? So what are our thoughts? Our thoughts are if you're saving 25 % of your gross income for the future, if you were doing that, you get to choose what you do with the money above and beyond that. So if you're saving 25%, you're funding all your retirement accounts and doing that sort of stuff, and you decide that one of your financial goals, because money is nothing more than a tool that allows us to accomplish our goals, is to be debt-free by 35, then it's your prerogative. You can do that. Now, what I'd want to do is I'd want to walk through some mathematics with you and say, man, Kyle, not having a mortgage at 35 is super cool.

56:34Brian Preston:You know, it's only slightly cooler having the ability to just write a check to pay off that mortgage. Cause at your age at 30 and 28, 5.625 on a primary residence home loan. It's just not that crazy. And I'm going to argue that your dollars could work a lot harder for you elsewhere and could even potentially have you be debt-free sooner if you were to implement a different strategy. But once you save 25%, you get to pick and choose. Kyle, when you can make this decision, you are at step eight because you've done it all. You've loaded up the retirement accounts. Even your question, you kind of set up.

57:11I'm assuming if you've thought about how you're actually going to use this money when you retire, you're talking about Coast Fire, it's going to probably require a savings rate that's higher than 25%. But I'm going to give you credit if you've done the math and you know that, hey, yeah, with what we've saved up and what our current savings rate, we're going to be A-OK and we still have extra resources that we want to be debt-free, then that's step eight. And you can, I give you permission, as long as you've done the math on that your Coast Fire situation really is that frothy that you can go ahead and prepay a mortgage at 30 years of age, then I think it's okay.

57:45You've earned that right once you get to step eight. Just make sure you've measured twice, cut once on those big decisions, because that's what step seven is, is when you're thinking about how you're actually going to use this money. Now, I realize Bo is the extreme because forever he didn't want me paying off my mortgage. Well, just because I'm good with math. I mean, because, yeah, because my interest rate was so low. Now it wasn't a 5.6, 625, which is probably about where mortgage rates are right now. I had a two and a half percent mortgage rate, which did pain me too, but I'd gotten down to where it was like 60 grand.

58:18I mean, I think we were talking about a few hundred bucks a year. It just didn't make sense anymore to keep it. But it's one of those things where I understand the desire to be debt free. Just make sure you've done the math on the front end that the opportunity cost is not, it feels good emotionally, but it hurts you from a financial standpoint.

58:38Brian Preston:Love it. Never forget. We've talked about a lot of things on the show, whether it was our rules for buying a house, guidance on buying a car, how to become a client, when to become a client. All of that lives on moneyguy.com anytime you need it. Even though we turn the cameras off, you can go to moneyguy.com slash resources to take advantage of all of our free calculators and downloads and learn more about all of the things that we talked about on the show. So be sure to check out moneyguy.com. And thanks for joining us today. Guys, I just like having the team back together. I mean, it was really fun.

59:11I mean, it was one of those whenever I hope when I go on, because I go on vacation more than anybody. I reserve that right as the older guy. I hope that when I'm not here, you're like, man, it was just, you know, it was a shame that Brian wasn't here today. It's definitely not the same. I don't like it as much. But when you guys, I like us all being together because the lift is easier. It's more fun. We just have a blast doing this. And I hope that that comes through is that we really do love creating content for you guys so you can live your best life financially and also your feedback. You guys let us know when content hits and when it changes your life.

59:47And that is the fuel. We did a collab with Aaron Talks Money, and it was on ABLE accounts. And Erin was able to reach out to us in the last few days and share with us some feedback she's gotten from some specific audience members. Guys, that stuff means the world to us. So we appreciate y 'all going on this journey with us. We really do believe there's a better way to do money. And that's why I love that we got to share the good of Total Money Makeover by Dave Ramsey. We also get to share the good of Die With Zero by Bill Perkins. but man oh man do we think that we've created something that can help you and your financial journey with both the financial order of operations and millionaire mission i'm your host brian joined by mr beau reby and the rest of the content team money guy out the money guy show is hosted

1:00:33Brian Preston:by brian preston and beau hansen brian and beau 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. All investments involve a degree of risk, including the risk of loss.

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