How To Get Rich and Stay Rich in 2026 (By Age)

21:15Brian Preston:It's just worth noting that. Yeah, because it ties into our net worth goal of having one times your salary by the time you reach 30. By the time you're 35,$606 a month if you're getting a little bit of a later start. That's like most Americans. Lump sum needed at that point is a little under$79 ,000. And for the 39-year-old, quickly about to approach crossing into being 40,$943 a month or a little over$122 ,000 lump sum requirement. So if you're thinking about a checkpoint where you should be by the end of your 30s, by the end of this decade, we want your total portfolio value, the value of your investments to be roughly three times your annual gross income.

21:56Brian Preston:If you can be at that place, if you can have your portfolio there, then you're going to be well on your way to starting your 40s in the right position. So you're saying basically come into the decade one times your income, but if we've done this right, we'll come out of the decade at 39 to 40 at three times your income. That's exactly right. Great goal. Spring is here and the shopping list is long. Time to make a Lowe's run. Buy three bags, get three free of stay green one cubic foot garden soil. Plus, right now members can earn four times the points on an eligible purchase. Start spring off strong with these deals and more.

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23:06Brian Preston:Book it with Priceline. Download the Priceline app or visit Priceline.com and book your next trip today. Go to your happy price, Priceline. All right, Brian, let's talk about the 40s now because 40s are kind of interesting. It's sort of a tale of two stories. Either you've done what you're supposed to be doing and you're in the right spot, or you've not done what you're supposed to be doing and you have to start playing catch up. Either way, one of the things that we want you to do in your 40s is we want you to get specific about your plan. We've given you all kinds of guidance around like save 25 % and follow this rule and do this.

23:42Brian Preston:But as you get into your 40s, we want you to begin putting some teeth into, okay, this is what I personally am actually trying to accomplish with my dollars. Well, this money is actually turning into a lot of money at this point. So you better be paying attention to asset location. And if it gets to a certain level, we often talk about index target retirement funds. But once you cross over about a half a million dollars, tax location, like what's in different accounts, whether it's retirement, whether it's Roth, whether it's your after-tax brokerage, that location matters for you. And you also should have a good idea of where you're trying to go and figuring out, are you ahead of the curve, behind the curve, right where you're supposed to be?

24:18This is exactly why we created the Know Your Number course and tool. is because we want to give you some functionality to where you can figure out, hey, these are the variables that I'm trying to play with so I can figure out my head of the curve, behind the curve, with rate of return, savings rate, inflation, you name it. We put it in here. If you go to learn.moneyguy.com, we will help you figure out exactly where you are in this process.

24:41Brian Preston:What's fantastic is once you have defined the finish line, once you've defined what your number is and you have an accurate understanding of where you are today, you can then reverse engineer into, okay, well, how much should I be saving? Do I still need to be saving 25 % or am I out ahead of the curve? Or perhaps maybe I'm not exactly where I need to be. So I need to be investing 25 % or more to make up the difference. Because one of the truths that happens in our 40s, a lot of folks reach your peak earning years. This is where your shovel might be the largest that it's going to be in your career.

25:18Brian Preston:And while you may not still have the 88-time multiplier, you may not still be the billionaire of time that your 20-year-old self was, in your 40s, your dollars still have a lot of juice. Well, that's why we have the wealth multiplier. And look, without a doubt, the prime time to start investing is in your 20s and even 30s, because we see that wealth multiplier for the 20-year-old is 88. The wealth multiplier for a 30-year-old is 23. 40, it's still seven. But here's the thing. You just said something that I want people, if you're mad at yourself because you procrastinated on saving and investing, Bo said something really magical there.

25:54The fact that these are your peak earning years. Turn that into fruit for your future self by actually starting to save and invest. But you have to get serious. More of the weight falls on your shoulder now. We're past. Still, compounding growth can do a lot for you, but it's not easy street anymore. So take it serious. You still have enough time on the calendar to make the money work for you.

26:17Brian Preston:And then in your 40s, we want you to keep following the foo. You've lived a life at this point. You've recognized that your financial life is not likely straight up and to the right. There are fits and starts and setbacks, and that's okay. Even if those things happen before this stage, even if those things happen in your 40s, the financial order of operations should be your guide to let you know what you should do with your next dollar. And if you can do that, you can use it as your litmus test, then you're going to put yourself in a position to not fall into some of the traps that we see people in their 40s fall into.

26:52Brian Preston:And the first trap that we see people, a lot of folks do, Brian, is they just don't know where they are. They have no idea where they stand from a financial standpoint. Well, I mean, this is bad. We've seen the stat. One in four Americans have no idea how much they've even saved for retirement. By the way, I think a lot of times that's because they haven't saved enough. That's right. They don't want to know. We see the stats and they stick their head in the sand. They say, it will get better. I'll just let them know. It will not get better because time is actually working against us at this point.

27:20So you've got to start taking an active role of knowing what you own, what you owe, where you are. And that's why we strongly encourage you guys, if you're in your 40s, don't be a rudderless ship because every 1 % or 2 % more are focused in on your direction, the easier it's going to be to reach your goal. And that's why you better be doing a net worth tool. If you're not using a net worth statement every year to kind of use the dashboard as the CEO of your enterprise, you're missing out. And we've tried to give you several ways you do this. If you go to moneyguy.com slash resource, you can download a free version.

27:53But if you need a little more guided approach, and I think somebody in their 40s definitely needs the dashboard for you to kind of know exactly where you are. This is not just a little habit that you're trying to set up. This is something where you're going to start making decisions off of this. I want you to go to learn.moneyguy.com so you can actually get the more powerful tool that we've created. So you can actually, this is the same one that we use for our net worth so that you can actually take a more active role in the management of where your money's going.

28:20Brian Preston:Another trap, Brian, that we see people in their 40s fall into is that for some reason, they arrive at this conclusion that now I got to take a huge risk. Maybe I didn't make all the decisions I was supposed to. Maybe I bought too much car. Maybe I bought too much house. Maybe my savings rate wasn't where it was supposed to be. And so now I need that home run. I need to hit that grand slam. I need to do that thing that's going to right all of the wrongs. And oftentimes, people in the 40s get involved in stuff they have no business getting involved with, with the goal and idea that it's going to help them to catch up.

28:52Brian Preston:Just recognize this. Even if you're behind in your 40s and you're not exactly where you should be, you have enough time that you can still build it back without having to hit a home run, without having to figure out something that no one else has figured out. You can exercise the three ingredients of wealth creation in your 40s and still put yourself in a fantastic spot by the time it's time to retire. Well, a lot of times that high income can become a curse because if you make enough money to become like an accredited investor, you lose a lot of the safety stuff. That's right. Don't think that you have to fall in that trap.

29:28A lot of times the index funds and the things that got you there are still going to be extremely successful for you going forward. Don't feel like you have to get into that sexy sizzle of this is what rich people do. There's probably huge risks that you might not need. And the next thing I see people fall into, Bo, and we just had a call on one of our live streams in with this, is putting too much money in the kids' accounts first before they've even funded retirement. We had a six-figure 529 question, and you can't help but ask yourself, I hope if they had that much money in the 529 that they fully funded their retirement.

30:00And this is kind of like when you get on the airplane and the flight attendant gets up there with the safety briefing and says, hey, make sure if you're sitting next to that child that you put on your safety mask first before you put it on your child's because you're not going to do anybody any good if you save them, but you're way gone. So it's the same way with your own financial life. Make sure you're doing what you need to and then let it be in step eight of the financial order of operations before you start really taking care of the kids.

30:26Brian Preston:But a lot of people are doing this. We know that right now, 56 % of Americans said that given the choice, they would choose to save for their kids' college instead of their own retirement. Well, when your student gets to college, there are going to be scholarships. There's going to be grants. They can work through it. There are ways they can pay for it. When you get to retirement, there's not going to be anyone there to help subsidize or give you an outlet. It is on you. So make sure you are prioritizing that in the right order. So as you move through this decade, what are your goals or what things should be thinking about?

31:00Brian Preston:Again, you should have assessed where am I in my journey and what is my appropriate savings rate? If I'm not saving the way that I have been, maybe I need to increase that to 25%. Maybe even at this stage, 25 % isn't enough. You need to understand what do I need to be saving to get to the place that I want to be when I get to retirement. All right, let's throw some numbers at them. Let's tell them what the goals are to reach million-dollar status by the time you're 65, starting at age 40, a little over$1 ,000 a month. That's right. We went from 88 at 20 to now$1 ,052 a month. Lump sum, a little over$136 ,000.

31:37For a 45-year-old,$1 ,806 a month or a little under a quarter of a million,$224 ,000. For a 49-year-old,$2 ,812 a month. That seems like a ton, but good news. This is peak earning years for most people out there. So you probably, if you're going to have a chance of being able to save$3 ,000 a month, it's going to be in your late 40s. So let's make good with that. And the lump sum needed would be$322 ,000.

32:05Brian Preston:A thing I want to remind you is in your 20s, in your 30s, it's a great idea. Hey, I want to be a millionaire. What would be required to get me there? By the time you get to your 40s, it should be less about what does it take to be a millionaire. and it should be more about what is my number? What am I working towards? So maybe I need another million dollars. That would mean increasing at age 40, your savings by$1 ,000 per month or at 49 by an extra$3 ,000 per month. We want you to be able to hone in on how you can impact your savings rate that way because by the time you finish this decade, by the end of your 40s, we want you to have almost six and a half times, 6.4 times your annual gross income saved in your portfolio.

32:49Brian Preston:If you can do that, you are well on your way to financial independence. All right, let's close this thing out with something that I resemble. That's for the 50s and beyond. And by the way, I look nothing like the image that they put up there. No, no, I thought this was a self-portrait they said of you and Colonel Sanders mixed together. But let's jump right into these tips. Guys, if you don't have a plan for landing your retirement airplane, you are missing out. This is one of those things. You've got to be stress testing. You've got to be figuring out. There's a lot of variables that are going to be changing in your life.

33:21It can be a smooth landing or it can be a crash landing. You get to choose this. And here's the reality of it. I think a lot of you get to your 50s and beyond and you say, hey, I know I've done pretty good at saving and building this wealth. I've been listening to y 'all's content, but I've only done this once. And I just don't know where my blind spots. I don't know where things are going. I don't know what variables I should be considering. That's okay. This is why I can give you so much free advice for all these years is because our day job is, is that we actually help people all across the country make these decisions.

33:55And you don't have to be the only person making these decisions. We've done this hundreds. If you take the whole firm thousands of times for retirees, so you can know where the blind spots, know what you just don't know, and make sure you don't fall any traps that are sitting out there as you approach this increasingly powerful and important threshold of your financial life?

34:16Brian Preston:People ask it all the time, hey, why haven't you guys built a financial order of operations for retirement or for decumulation? And the answer is the financial order of operations is a great general guide for accumulation. How do I build my assets? How do I get to financial independence? But once you get there, the art of being able to live off of those dollars and have them sustain you for the rest of your life is very individualistic and very specialized. And so that's why there's not a one size fits all. So you want to make sure that you measure two, three, four, five times before you make that decision.

34:50Brian Preston:It's why we think that taking the relationship to the next level could make a lot of sense. Another thing that I want people in their fifties to focus on is we talk a lot about money and a lot about finances and a lot the dollars, but it does you no good at all to have a huge pot of money saved up when you get to the age that you can actually use it to live the life you've already dreamed of and you are not healthy enough to enjoy it. Make sure that you recognize that health is wealth. And so taking care of your body, taking care of your mind, doing the things necessary so that you can enjoy the rest of your life is just as important as building up the dollars in your 20s, 30s, and 40s.

35:30And then I want people to think outside of, you know, so much is spent on the saving lifestyle. You know, you spend decades, but there needs to be thought of what's next. If you think about your next endeavor, what do you actually do for fun? What do you plan on doing once you leave the workforce? These are things, guys, that you need to be spending some time being very intentional on what your hobbies, what the goals, where you're hoping your money will take you. because if it's just a dollar amount is your goal, I think you're gonna find that that's quite empty. So you've got to actually do some preparation, figuring out what is the next thing I'm going to do.

36:05And that's another thing. We spend a lot of time on that when we work with clients all across the country. This is another thing we try to help them hone in on what that hobby, what the activities are going to be that still give them the happiness and the fulfillment when you get out of the bed that you're doing your own little part to be excited about this world.

36:21Brian Preston:When we think about traps that people see in their 50s, One of the traps we've seen in the 50s is very similar to something we saw in the 40s. And this is the way that it goes. Man, I didn't quite end up where I thought I was going to end up. I didn't save the way I thought to. I spent more than I thought. And so now I'm in the position, I got to make up for lost time. I got to do something to get the ball across the finish line. There must be something else out there. There must be some magic pill I've not taken yet. And they begin looking for some sort of speculative, crazy, over-leveraged, over-risked type investment as a means to bridge a gap that should not be there, don't let yourself fall into that trap in the 50s.

37:03Brian Preston:It is not a magic bullet to make up for lost time, nor is it that thing to take a lifetime of solid, steady, saving, solid, steady, sound financial decisions and then risk it all because you're trying to shoot for the move. And another one is just keeping debt around. Look, guys, we talk about financial freedom, And that word freedom is just something it's good for the soul, I think, when you hear that. But are you really free if you're still indebted? If you have obligations sitting out there, that's not freedom to me. So I want to encourage you, even if it's low interest mortgage debt, I'm hoping you're creating a plan by using our financial order of operations to figure out how you even get to step nine, where it doesn't matter if it's a low interest debt.

37:46If you can be completely debt free, there is something magical that happens. when you don't owe anybody and you control your time, you control your resources, that's where we want you to be.

37:58Brian Preston:So what should your goal in your 50s be? Well, it's a mix of both qualitative and quantitative. Qualitative, what is my next endeavor? What's the next stage that I'm moving into? And then it's also quantitative. What steps do I need to be taking to finish this last chapter well and begin the next chapter well? If you can start to define that, sort of figure out what that looks like, there's a really good change. You're going to set yourself up for a very happy financial independence era. This is also the last stop with the next one is keeping, you know, look, we say save and invest 25 % of your gross income.

38:36But at this stage, 50 and beyond, it needs to be more, you know, specific to your financial life. Don't skip out on that step of actually figuring out where you're at. Are you behind the curve, ahead of the curve, or right where you're supposed to be? because it might be more than 25%. Good news, you're still in good earning years before you cross that threshold of retirement, but just don't sleep on this last chance to really let your army of dollars do magical things for you.

39:01Brian Preston:What's crazy is that even though you might not still have the time on the side, think about this. If you were a 50-year-old and you've saved up$351 ,000, that sum of money has put you on track to be a millionaire by 65. If you're 55 years old and you've saved up$523 ,000, you're on your way to millionaire status. And if you're 59 years old, you've saved almost$700 ,000. Even just that$700 ,000, if you can let it work for the next six years, has the ability to turn into a million dollars. It's not 88 times over like it was back at 20, but there is still an opportunity for your dollars to grow, for you to end up in the spot that you want to be in.

39:43Brian Preston:And if you're thinking about true financial independence and what your benchmark should be by the time you get to the end of your 50s, we want your goal to be to have 13.7 times your annual gross income saved in your investment portfolio. If you can do that, financial independence is likely right around the corner. Well, you can do quick math and realize, hey, we've already told you peak earning years is somewhere between that 48 to 52. And then you've multiplied that by close to 14. This is a large sum of money we're talking about if you're doing this right. Guys, I know we've already pulled the work with us slide, but it really is the reality of it.

40:21You probably have quickly seen that your simple financial life has now gotten much more complex, but yet you're still going to long for the simplicity of what's the best way to manage this, how I can get as few moving parts as possible. We're here to help out on that. And I love creating this type of content because we essentially are boiling it down to the key things that you need to know about money by each decade that you walk through so you can maximize those tips that we shared, avoid the traps, but then also know exactly what those goals are. And we'll keep creating this type of content.

40:55But in the meantime, if you're younger and you watch the entire show, go download some of our free stuff. Moneyguy.com slash resources will be your friend to help you accelerate and take that relationship to the next level in the not too distant future. I'm your host, Brian, joined by Bo, Money Guy team. Out.

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