141: The 5 Financial Accounts You Need to Set up BEFORE 2026

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0:33When did making plans get this complicated? It's time to streamline with WhatsApp. The secure messaging app that brings the whole group together. Use polls to settle dinner plans. Send event invites and pin messages so no one forgets mom's 60th. And never miss a meme or milestone. All protected with end-to-end encryption. It's time for WhatsApp. Message privately with everyone. Learn more at whatsapp.com. Austin, we finally did it. We've officially launched the first ever multi-asset investment opportunity in partnership with Republic and the cashmere fund that includes SpaceX, Perplexity, and XAI all wrapped up into one investment.

1:16After months and months of work behind the scenes, we've finally been able to get this opportunity across the finish line. So Austin, I'm so stoked. Tell everyone what we've created. We've created a very, very interesting opportunity that is open to any of our listeners to consider here and learn about. So as you guys know, there are publicly traded companies on the stock market and there are privately held companies that are not traded on the stock market. Now, anyone can buy and sell stock in the public ones right there on the stock market. Go to public.com, make some trades. But only those with deep connections are able to buy and sell stock in the private ones.

1:56investors in those companies have to be invited. For example, Robert, you were invited to invest into Elon Musk's company XAI a couple years ago. It was at a$5 billion valuation, which at the time seemed pretty crazy, but now it's trading at a rumored$200 billion valuation, which is a 40x return in just two years. That's the type of stuff that happens with these private companies, right? They have these crazy potential insane upsides. And after months and months of hard work, working with the lawyers and Republic and the Cashmere Fund and brokers and everybody around the scenes, we've finally now been able to offer these types of investments to the Rich Habits podcast listeners, newsletter subscribers, or just anyone else that supports the show.

2:42So with as little as$7 ,500 committed, your money will be invested in the likes of SpaceX, Perplexity, and XAI, as well as 38 companies inside of the Cashmere Fund, including Mr. Beast's Beast Industries, Katy Perry's DeSoy, Graza, Acorns, and many more. This has been something we've been working on behind the scenes now since August, and we're thrilled to be able to unlock an asset class of pre-seed to pre-IPO privately held companies to the world. So if you want to invest alongside Robert and myself in this opportunity to have SpaceX, Perplexity, XAI, Mr. Beast, Graza, Acorns, Katy Perry, exposure to all of these privately held companies with your$7 ,500, which is how much I'm investing, Robert's investing, right?

3:31Diversification's the name of the game. Click the link in the show notes below. Go to Republic, R-E-P-U-B-L-I-C.com, Republic, not to be confused with just public, but Republic.com. You'll probably see it popped up there. You'll see our faces on the website. But anyone that's accredited is invited to invest in this. We are so excited to unlock this asset class, Robert. And yeah, it's going to be great. So let's keep it there. We'll come back and remind you guys about it in every episode going forward. We have$10 million of allocation, so we're not too sure how long that's going to last. We've already filled up many percentage points of that in just the last couple of hours since launching this on Wednesday, October 22nd.

4:11You're watching this now on Monday. I'd imagine a lot of that has been filled up by now. So if you want to join us, you're invited. Click the link in the show notes below. So Robert, let's now jump into this episode and what we're talking about. So give us the breakdown. What is this episode all about? The top five financial accounts you need to set up before 2026. 2026 is just around the corner. And if you haven't set up the right financial accounts by then, you could be leaving thousands of dollars on the table next year. And here's what most people don't realize. We're sitting at a major inflection point.

4:45The 2017 Tax and Jobs Act is going to sunset. Retirement contribution rules are changing under the Secure Act 2.0. Student loan policies are shifting. And if you wait until December of 2025 to scramble and open these accounts, you're going to miss out on free money, tax breaks, and years of compounding growth. So today we're breaking down the five essential financial accounts you need to have in place before we flip the calendar to 2026. This isn't theory. This is your financial infrastructure. And without the right accounts, you're literally leaving money on the table every single month. So Austin, let's get into it.

5:26Before we dive into the specific accounts, I think it's important for us to talk about like why this actually matters. So why should someone care about opening up the right accounts in 2026? Your accounts are your financial infrastructure. They're the foundation everything else is built on. If you don't have the right ones, you're not just missing opportunities, you're actively losing money. Let's say you're not contributing to your 401k and you're missing out on a$500 employer match every year. That doesn't sound like a lot, but over 30 years at a 9 % average return, that's over$76 ,000 you just left on the table because you didn't open one account.

6:05And Robert, that's just one account. You now multiply that across an HSA, a Roth IRA, brokerage accounts, right? The compounding losses can add up pretty fast. So today we're going through the five accounts that you need to have set up before 2026. And we're going to tell you exactly why each account matters, what they do for you, and how to think about prioritizing them. So be sure to stick around to the end. So Robert, let's talk about the foundation. Kick us off with the first account. The first account is a high yield savings account or an H Y S A. This is your emergency fund. And if you don't have one yet, this is the first thing you need to open today.

6:42High yield savings accounts are paying anywhere from three to 4 % APY. That's not going to last forever, but while rates are high, you need to take advantage of it. Compare that to a traditional checking account that pays you basically a big nothing burger. You're leaving free money on the table every single month you don't do this. So act fast. And the goal here is really simple. You want to keep three to six months of expenses in your high yield savings account, because this is not your spending money. This is not your investing money. This is your, the car just broke down, or I just lost my job, or I'm having a really rainy day money, right?

7:19It needs to be an account that's separate from your checking accounts. You don't just go spend it, but it's also earning interest in easy to access in case of an emergency. So if you're just getting started, do not overthink this. Go open an account on public.com, start earning that 3.8 % APY. They make it incredibly simple. They are consistently one of the highest paying savings accounts out there. But if you don't use public, that's fine with us. Does not matter. Just go try it. Go, maybe go with Ally or Wealthfront or something else that makes sense to you in your situation. Doesn't matter what you use.

7:50What matters is that you're actually using a high yield savings account for your emergency fund. Like Nike said, just do it. So many people that I talk to have tens of thousands of dollars sitting in a traditional checking account or savings account making zero. Don't be that person. Get the money to the high yield savings account. Get the free money. We love public, but anywhere is fine. Just make sure you do it. Now, our second type of account that you need to have are your retirement accounts. Think 401k, Roth IRA, and traditional IRA. So here's why this specifically matters for 2026. When the Tax Cuts and Jobs Act sunsets, tax brackets are likely going to go up a little bit, which means if you're planning to contribute to a Roth IRA, which means you pay taxes now and then you withdraw the money tax-free in retirement, it might be a little bit more expensive to do that in 2026 and beyond compared to right now.

8:42So opening and funding a Roth IRA now, while those tax brackets are still lower, could save you thousands, perhaps tens of thousands of dollars over your lifetime. Let's break down the accounts quickly. If you have an employer-sponsored 401k, you need to be contributing to it because most employers offer a match. Usually 3 % to 6 % of your salary, that's free money. And if you're not contributing enough to get the full match, you're literally saying no to a guaranteed 50 % to 100 % return on your money. And then there's the Roth IRA. We've talked about this one for so long. It's such a powerful wealth building tool.

9:18You contribute after tax dollars, but all the growth and withdrawals in retirement are completely tax free, which I like that. No taxes. Sounds good to me. For 2025, up to 7 ,000 is how much you can contribute or 8 ,000 if you're over the age of 50. And if you're under 30 and start maxing this out right now, you could easily have a million dollars in this account by the time you retire in your mid 60s. And if your income is too high to contribute directly to the Roth IRA, look into the backdoor Roth IRA strategy. It is a completely legal way to get money into a Roth, even if you're above the income thresholds.

9:54We won't go deep into that today, but just know that it exists. So the bottom line is if you don't have some sort of retirement account already working for you, if it's a 401k, if it's a Roth IRA, you got to have some sort of retirement account rocking and rolling or contributing to consistently. So the first type of account we talked about was the high yield savings account. The second type of accounts here are the retirement accounts. You need those heading now into 2026. Open the account, doesn't matter which kind it is. And you're like, oh, Austin, I don't have money to put into it. Of course you do.

10:27You've got 10, 25,$50 a month. That's better than nothing. Starting somewhere is what's important. Just getting started, period, is what matters. We talk about it all the time, and that is exactly why I love doing this. It's all about taking action. And account number three is one of the most underrated accounts in personal finance, the health savings account, or you've seen it called an HSA. And here's why this is so powerful. An HSA has a triple tax advantage. Let me say that again, triple. You contribute pre-tax dollars, the money grows tax-free, and you can withdraw it tax-free for qualified medical expenses.

11:06There are no other accounts in the tax code that gives you that. And here's a little secret for you, Robert. If you can afford to pay for those medical expenses out of pocket throughout your life, you can actually just let your HSA grow over time and invest into it like a retirement account. Then after the age of 65, withdraw from it for any reason, not just medical reasons, any reason, and you only pay income tax, just like you would with a traditional IRA. So you get the pre-tax, and then it's taxed later in retirement. So it's essentially like a shadow stealth retirement account, if you think about it like that, which I think is pretty interesting.

11:43So if you're healthy, and you're not tapping into it, an HSA is essentially this shadow stealth retirement account that you should be taking advantage of. Now the catch is you need to have a high deductible health plan, which means for 2025, your deductible needs to be at least$1 ,600 for individuals or$3 ,200 for families. If you qualify, the contribution limits for 2025 are$4 ,300 for individuals and$8 ,550 for families. And if you're 55 years or older, you can contribute an extra$1 ,000. Max this out if you can. It's one of the best wealth building tools nobody talks about. How cool is that though, Robert, if you think about it, right?

12:22Like, hey, I'm going to contribute, let's say, what's the individual again here? It was$4 ,300. So not only do I write off 43 against my taxable income, saving me probably 1500 bucks, right? So I get to save money on my taxes by contributing it. Let's say it's invested for seven years and it doubles now because the stock market doubles every seven years to 8 ,600. So I've got 4 ,300 of profits and I can spend all 8 ,600 on my kids' braces and there's no taxes, right? You know what I'm saying? man, like how cool is that? It's such a cool account that no one talks about. All right, Robert, let's talk about the fourth type of account people need going into 2026.

13:00And that is drum roll, a normal taxable brokerage account. Give me that bridge account on public.com. This is your after tax investing account. And it's absolutely essential if you have financial goals that you want to achieve before 59 and a half years old, right? Because retirement accounts are great. We love a good 401k and a good, you know, traditional or Roth IRA, whatever you might have a 403B or something like that, but they lock your money up until you're almost 60 years old. You want to buy a house, you want to start a business, you want to take a sabbatical maybe, or maybe even retire early like what I want to do.

13:35You need money that you can access without the penalties. That is what a bridge account or this brokerage account is for. Yeah, you can invest in stocks, ETFs, index funds, whatever you want. And while you will pay capital gains taxes when you sell, we love the bridge account because the flexibility is worth it. Plus, if you hold investments for over a year, you're taxed at long-term capital gains rates, which are way lower than ordinary income tax rates. The key here is automation. Set up automatic contributions every month, even if it's just$100 or$200, and invest in diversified index funds that we talk about all the time like VOO or VTI.

14:18Don't try to time the market. Don't chase individual stocks. Just buy, hold, and let it compound, and you'll thank us later. And if you're younger and you're like, guys, you just named all these accounts. Which one do I actually go do first? I have a phrase for it. Here we go. Ready? Match beats Roth beats taxable. Up to the match with your employer 401k because that's free money. Who doesn't want free money? I like free money. Up to the match to get the free money. Match beats Roth. So next is your Roth IRA. Max that out$7 ,000 a year or$8 ,000 if you're over the age of 50 and invest that into the VOOs and VTIs of the world like Robert just talked about.

14:58Then if you have autonomy over your 401k, which could be you, go back and max out the 401k. That's great. And you get some nice cool tax savings there on the upside. And then if you don't have autonomy, which is a lot of us, we go put it into the taxable account, which is exactly what this account is. Right. And Robert, it's important to remind people here, right? If you ever want to retire and not trade time for money for the rest of your life, you need to have a nest egg that's growing for you over time. And the easiest way anyone can begin investing towards their future is on public.com. They make it incredibly simple to build a multi-asset portfolio, including ETFs, stocks, bonds, crypto options, and more.

15:38They also offer access to industry-leading yields up to 3.8 % APY for your emergency fund. And for a limited time, you can earn a 1 % match on all of your IRA deposits, IRA transfers, and 401k rollovers, which is$1 ,000 of free money for every$100 ,000 you roll over to the platform. So that old 401k that's still at your old employer you haven't moved over or changed or done anything with, roll it over, get your 1 % match, and claim your money. Fund your account in five minutes or less. Head to public.com front slash richhabits to claim your 1 % match today. Paid for by public investing. Full disclosures in the podcast description.

16:16All right, Robert, let's round off with our fifth type of account that people need to have opened up before 2026. Account number five is a 529 college savings plan. Now this only applies if you have kids or you're planning to have kids and you want to save for their education. But if that's you, this is a huge opportunity. A 529 is a tax advantage account specifically for education expenses. You contribute after-tax dollars, but the money grows tax-free and withdrawals for qualified education expenses are also tax-free. Plus, many states give you a tax deduction for contributions. Isn't that cool?

16:56You get a tax deduction for saving for your kid's college, and you're using the profits from the stock market to pay for your kid's books and tuition. Or maybe they go to trade school, and you're like, how cool is it? It's such a flexible account. I love it. Now, here's the new rule that makes it even more exciting. Under the Secure Act 2.0, if your kid doesn't use all the money in their 529 account, you can roll up to$35 ,000 of it into their Roth IRA, which means that they now have$35 ,000 in their Roth IRA in their mid-20s, let's say, that's going to grow for them for the next 40 years. You know what$35 ,000 turns into after 40 years, Robert, assuming a 9.5 % return?

17:34Well over a million dollars, right? This is generational wealth we're talking about here. So the 529 account, especially after the Secure Act 2.0 that came into play, makes it just that much more advantageous. So if you have kids, open a 529 now. Even if you're just putting$50 to$100 a month into the account, that's going to compound over 18 years and make a huge difference in their life. And if your state offers a tax deduction, you're getting free money just for contributing. All right, Robert. So we've talked about the five accounts, right? The high-yield savings account, the retirement account, the HSA account, the taxable account, and now the 529 account.

18:11If I were someone listening right now, I would feel overwhelmed, maybe a little bit of anxiety thinking about all these things in accounts. So let's give them an action plan. Yeah, so item number one, we're going to keep this super simple. Open the accounts you don't have. Start with the emergency fund and retirement accounts because those are non-negotiable. You have to do it as soon as possible. Don't get lost in the Christmas holiday season and don't do this. Step number two, automate those contributions. Set up an automatic transfer from your checking account to your savings, retirement, HSA, and brokerage accounts.

18:45Pay yourself first. And step number three, review your accounts annually. This is so important. At least once a year, look at your contribution limits, check if you're maximizing employer matches, and adjust as needed. So if you're feeling overwhelmed, just listen. Take a deep breath. Don't do all five of these at once. How about you start with one or two? Go open up the high yield savings account this week on public, maybe a Roth IRA the next week, also on public. But building the habit of like, hey, what's my money doing for me? Am I paying myself first? I love that you talked about that, Robert.

19:17Let's dig into that for a second. Because we hear, you know, hey, you got paid from your employer. Cool. My money is going to go to rent. My money is going to go to this thing I want to do with my friends. I'm going to the bar. I'm buying the shoes. I'm going to pay yourself first and then go do those things. Talk about the importance of that. Yeah, so many people don't realize that your money has to have a job. You know, I've been saying for years and years to anyone that'll listen is make your money work as hard for you as you work to get it. And by assigning a place, putting automation to your money and not letting it sit in your checking accounts, you will find so much more money available to you to be able to invest in these five accounts.

19:56because if it just sits in your account and the weekend rolls around, your buddies hit you up to go to a concert, or you go to a farmer's market or to the mall, you're just going to blow the money. And that's why I love to tell people and make sure they understand, get your money working as hard for you as you work to get it. It's so critically important in your wealth building strategies. And I think another one of my favorite things that you say is what doesn't get measured doesn't get managed, right? So if you're not measuring the money coming in and out of your account, If you're not using an honest budget and keeping eyes on all this stuff, you're never going to be able to manage it accordingly.

20:32So all we're saying here is that these accounts are the infrastructure for building wealth. Without them, you're going to end up paying more in taxes. You might miss out on some free money or you could lose years of compounding growth. So get them set up before 2026 so you're not scrambling or paying more than you should. And, you know, we've heard this phrase a lot, but I'm going to say it again here, Robert. The best time to open up an account and start investing was 10 years ago. The second best time is today. 100%. Wow, what a great episode. I just love breaking these things down because I feel like anyone that takes action is going to be shocked in a year, two or three years, how much more money they have in these accounts working hard for them just because they took these simple steps and got it done.

21:18You know, Robert, I've actually been contributing to a 529 account for my niece and nephews for the last, I think, two or three years it's been. I'm going to log into this account right now in real time. I only contribute like$150 a month. I had to go to Vanguard is where I did it on. So, like, you know, no gatekeeping here. I went to Vanguard's website. And what I ended up doing was they had a minimum deposit of like$3 ,000. So I had$3 ,000, made the deposit. And then it was like$150 a month. It's invested in the S &P. And it's invested in some growth stuff, right? So essentially the VOO and VUG ETFs is kind of how it's broken out here.

21:5380-20 split between VOO and VUG there. It's got$11 ,000 in it here, Robert. And this has been just three years. So yeah, to your point, you kind of put this stuff on autopilot. Oh yeah, 100 bucks, 150 bucks, whatever. Yep, that's what I do every month now. Every month, it's all good. It's gone. It's in the budget. I'm not worried about it. Automation, right? Come back three years later to 11 grand. So that's the type of stuff we're talking about. In the moment, it doesn't feel like any traction's being made, but then you look at the accounts, if it's an HSA, if it's a brokerage, if it's a Roth, if it's a 401k, a 529, whatever it might be, you come back two, three, four, five, six years later and you're like, whoa, I've been making some like real progress on this.

22:32Yeah, so many people, we see it every day in our world on Instagram and TikTok and even X, where all of these people shout to the mountaintops that saving money,$10,$20 here a week and investing doesn't make a difference. And they just need to make more money. And I just think it's ridiculous because the math doesn't add up. We did an episode recently where we talked about$1 in your early 20s turns into$70 in retirement. So anyone listening out there that doesn't think compounding is this magical kingdom, you just have to understand the power of it. So don't listen to the fake gurus telling you that this$50 or$100 a month can't make a difference because what Austin just illustrated is proof.

23:15The money will start to really pile up even if you're only starting out small. Now, Robert, we got a ton of cool questions coming at you from our Instagram DMs, our richhabitspodcast at gmail.com. We love answering the questions, but before we jump into the Q &A section of the episode, got to give a shout out to Neos Investments. Neos offers ETFs that seek high levels of monthly income with a keen focus on tax efficiency while providing core portfolio exposure across equities, fixed income, real estate, cryptocurrency, and cash alternatives like T-bills. Their ETFs may be especially interesting for investors looking to generate some tax-efficient monthly income inside of their investment portfolios.

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24:40There's no guarantee that NEOS ETFs will make monthly distributions and the amounts may fluctuate from month to month. Cryptocurrency is relatively new and the market has its own specific risks, NEOS ETFs are distributed by Foresight Fund Services, LLC. Love us some disclosures there, Robert. All right, let's jump into our first question coming from Christina. Christina says, hi, guys. My name is Christina, and I love the Q &A portions of your episodes. They allow for learning from others, and you too give the best advice. Big fan of the show. So here's my question. Is there a general rule of thumb for when to refinance a home?

25:15Do you recommend a certain percentage of interest rate reduction before doing it? Our household income has reduced recently due to a sale job compensation plan change. We have a second child on the way, and daycare is outrageously expensive. We have a 6.7 % interest rate on a 30-year fixed mortgage with a monthly payment of$4 ,100. We could really use the extra cash flow from refinancing, hopefully, in late 2026. So my question is, how do we know when the right time is to refinance our mortgage. Robert, you are a real estate guru. Walk us through your thoughts as to when it makes sense or a general framework you use to determine when is it worth it or not to refinance a home mortgage.