Everyday Investors Are Beating Fund Managers (Copy Their Strategy)

While we believe time in the market beats timing the market, recent data shows the average equity investor has underperformed the overall market by roughly 5% per year. Financial Advisors, Brian Preston and Bo Hanson, break down the behavioral patterns behind that gap, from loss aversion to overconfidence, and share what a smarter investment strategy can look like in 2026. Then it's your turn! We answer your live questions covering FOO Step 7, the benefits of ABLE accounts, and rapid-fire questions on FIRE paths, company stock purchase plans, and more. ⁠⁠⁠⁠Jump start your journey with our FREE financial resources⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Reach your goals faster with our products⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Take the relationship to the next level: become a client⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Subscribe on YouTube for early access and go beyond the podcast⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Connect with us on social media for more content⁠⁠⁠⁠⁠⁠⁠ Bring confidence to your wealth building with simplified strategies from The Money Guy. Learn how to apply financial tactics that go beyond common sense and help you reach your money goals faster. Make your assets do the heavy lifting so you can quit worrying and start living a more fulfilled life. Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

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• 0:31Speaker 01

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• 1:06Speaker 02

  What we're going to explain, what we're going to share with you today is so simple in theory. It's so simple in thought, and yet behaviorally, it becomes so, so difficult and so many investors, professional or otherwise, actually screw this up all the time.

• 1:23Brian Preston?

  Well, first thing, when people find out what I do for a living, I think they just think we sit around and do stock picking or market timing. So I always say, when's a good time to invest in the financial markets? And I'm always like, always be buying. It's always a good time to be an investor.

• 1:40Speaker 02

  Yep, so I think yesterday was a good time to invest. I think today is a good time to invest, and tomorrow's a good time to invest. But why do a lot of people not feel that way? Well, if you look at the actual data, the average equity investor historically has underperformed the overall market by 5%. And so you begin thinking, okay, well, everyone says investing is so amazing, so wonderful, so incredible, but when you look at the average investor, they actually do pretty poorly. But it has a lot less to do with the market. And a lot more to do with the actual investor themselves.

• 2:13Brian Preston?

  Yeah, so let's get into some of these behavioral science things. There's terms like loss aversion. What this means is is people really outsmart themselves. They fear driven decisions, you know, people see the stock market get beat up a little bit and they start looking for the exits about as fast as they can. They sell during the worst possible times that they should not be selling.

• 2:32Speaker 02

  Another thing that we often see investors do is they begin to herd just because something exciting has happened or someone else told me that I should do this, whether it be positive or someone else told me I should not do this, whether it be a negative thing, they end up moving in a herd, falling into a pack. And oftentimes, if you are greedy when others are greedy and you are fearful when others are fearful, it's not going to lead to the best outcome or best result.

• 2:57Brian Preston?

  And then let's not underestimate the very, very concerning overconfidence that most of us humans have.

• 3:04Speaker 02

  Yep.

• 3:05Brian Preston?

  Where we, we look at ourselves and we overestimate our ability to predict what's happening in the market. I think we've created a system that's going to make things better than your typical peers.

• 3:14Speaker 02

  Now, here's what's really interesting. This isn't just for small investors. This isn't just for everyday retail investors. Again, if you actually look at the data, according to Spiva, over the last 15 years, 90% of active managers, 90% of folks whose job is to go out there and get a return in excess of a benchmark in order to justify their fee, 90% of active managers, underperform the S and P 500. What that means is that if you were an investor, you likely would have been better off just buying the market, buying the index, buying the S and P, instead of hiring a professional to do that part for you over the last 15.

• 3:58Brian Preston?

  Yeah, and I kind of begin with the hint in mind. I already kind of gave this away, is that this is why we absolutely love dollar cost averaging. If you can set it and forget it and always be buying, that's what I love about that strategy. It really doesn't matter what's going on in the economy, the geopolitical world, it's going to help you start building wealth the right way, which is slow. And steady and then one day the exponential growth takes so much traction. You look back and go, how did I get here?

• 4:26Speaker 02

  Yeah, and we get this, but okay, this is theory, theory, theory, theory, theory. All right. What about in the real world? How does this actually play out? Well, we love to show this illustration because I think it paints the picture quite vividly. If we think about the history of the stock market, and specifically, we think about one of the most significant, most drastic downturns we have ever seen. It was the Great Depression, where if you look at the 25 year trading period, the market, the Dow Jones, it closed at 381 on September 3rd of 1929, and then it closed at 383 on November 23rd of 1954. So that's a $2 increase

• 5:09Speaker 02

  over a 25 year period. Well, if you were an investor at this time, you might be thinking, oh, well,

• 5:14Brian Preston?

  That's not even a lost decade. That's like a lost 20 plus years.

• 5:17Speaker 02

  That's like a lost working career. Why on earth would I ever invest? Why would I participate in a market where it's possible for the market for 25 years to be no better than it, to end no better than it started?

• 5:31Brian Preston?

  But think about this, if you were just doing the always be buying or dollar cost averaging, where systematically you were buying into this volatility and you were reinvesting the dividends and so forth, would you be surprised to learn that during this crazy period, this 25 year period, where the market literally was flat, it only made $2? You had an average annualized rate of return of 11.7%.

• 5:55Speaker 02

  That's right.

• 5:56Brian Preston?

  And that's because your behavior was the all terrain vehicle. It was buying while things were going down. You were still buying. While things started to recover and had a a sputter start, but then went back down, you were still buying. You didn't let that distract you. You will be rewarded if you can stay the course.

• 6:12Speaker 02

  But I can already, Brian, I can already hear the comments coming in. Guys, guys, guys, you can't, you can't talk about the Great Depression. That was almost 100 years ago. That's an old school idea. That's an old school thing. Well, this same thing can actually happen and does happen right now today. If we just think about Year 2026 so far, right? If we think about the way the market performed in the first quarter, if you were following the headlines, if you were allowing yourself to fall into this loss aversion mindset, if you were allowing yourself to fall into the herd mentality, you might have recognized that on March 30th, and here's a headline,

• 6:52Speaker 02

  "The American Consumer Confidence Hits A 2026 Low As Geopolitical Turmoil And Inflation Reemerge."

• 6:59Brian Preston?

  Oh, no.

• 7:00Speaker 02

  Scary, scary, scary, bad, bad, bad. Uh-oh, uh-oh, uh-oh. And yet, if we actually look at what the market has done since that time, since consumer confidence was at the lowest part of the year, it's actually made 14.3% since that time. If you would have acted on, uh-oh, things are scary, things are bad, things are frightening, things are uncertain, then there's a really good chance you would have actually missed out on this uptick of 14% since that point.

• 7:28Brian Preston?

  So let's, let's give you the rubber meets the road moment here. What's the key takeaways? The big thing? Don't outsmart yourself and don't overthink this. This is one of those things where if you just have this always be buying, set it and forget it mentality, you get to take out all the other noise. It's just, that's why, you've heard me do the analogy. I always think it's when we talk about volatility, I say it's that yo-yo. You remember, you're walking, you're the investor, who every day the stock market's going up or down, but every day you're also walking higher and higher up a mountain top of a growing economy. So if you can just stay the course, you don't have to drown yourself in all the information that in this new, modern world, kind of keeps us, and does analysis paralysis

• 8:12Brian Preston?

  and all these other things where people just don't fall into the, to the good behavior that actually builds wealth in the long term.

• 8:19Speaker 02

  Yeah, when it comes to building wealth, we believe that time in the market is way more valuable than time being the market. And if you want to see just how powerful that can be, I want you to go to moneyguy.com/resources and check out our Wealth Multiplier Calculator. You can literally put in your age, put in the amount that you have invested, and you can see. Okay, what does every dollar I invest or what does every dollar that I have invested up until this point have the opportunity to turn into by the time that I reach 65, by the time that I reach 55? And it can show you just how powerful your dollars can be. It does not have to be more

• 8:59Speaker 02

  complicated than that. You do not need a finance degree, you do not have to be some astute investor to be able to capitalize on allowing your money to work harder than you do.

• 9:12Brian Preston?

  And with that, let's roll it over to our

• 9:15Speaker 02

  I thought surely you had something. I was thinking another dime was coming. I thought you had something else.

• 9:19Brian Preston?

  I mean, I felt like we've been dropping some dimes today already. If y'all could have seen the content meeting we had this morning, there was all kind of stuff in there that I'm like, why do we not have a camera in this? But with that, that's probably a great transition over to our creative director, Rebi.

• 9:33Speaker 02

  Now, that's almost a transition. That's an interesting, what if we put a camera, just because these are people, I'm gonna ask them. If we put a camera in our content meetings and you guys were part of the process of us developing content, is that something that you would watch participate in? Can we get a poll? Can we do a poll on that?

• 9:49Brian Preston?

  Now, see, I look, they're gonna think that we planned that, but I really was. I know we brainstormed, we talk about this, but I love that Bo is actually like, what did he say? Bring it up. Why not go ahead and throw it out there?

• 9:59Speaker 02

  If you say, because we do love, we love that we get to sit here, we love we get to do this, we love that we get to load you up. So every single Tuesday at 10 a.m. in addition to sharing the stuff that we've put together behind the scenes, we love speaking to the things that you guys care about. So if you have a question right now, we have the team out in the wings collecting your questions because we do believe there's a better way to do money. Get your question in the chat with that creative director, Rebi. I'm gonna throw it over to you.

• 10:27Speaker 04

  Yes, I've got some questions queued up and it is these people's lucky day because it is Tumblr day. I just want to throw that out there right now ahead of time. So drop your questions in the chat.

• 10:37Brian Preston?

  And why do we love the Tumblrs is because they transform from koozie to quack, quack, quack, quack, quack. You don't even have it out here, Bo.

• 10:45Speaker 02

  They didn't put mine's not here.

• 10:46Brian Preston?

  Oh, my gosh. To a Tumblr. You can actually keep your beverages either hot or cold.

• 10:52Speaker 04

  He's so disappointed.

• 10:52Brian Preston?

  My Vanna White didn't show up today, so I'm sorry you don't get to see it in that room.

• 10:56Speaker 02

  Normally I have the three beverage setup here. I like to build my three buckets.

• 11:01Speaker 04

  He does have the other koozie though, so I guess we'll cut him.

• 11:03Speaker 02

  I do have another, ah man.

• 11:05Brian Preston?

  It's alright, it's alright.

• 11:06Speaker 04

  Alright, well first question.

• 11:08Speaker 02

  Now I'm gonna water the whole show because you said that.

• 11:10Brian Preston?

  If we were, if this was a professional operation, you know, it'd be even that much better.

• 11:17Speaker 04

  First question is from Ben K. He says, hi Money Guy Show. I am 24 and about to close on a house.

• 11:24Brian Preston?

  Wow, way out of the curve.

• 11:25Speaker 04

  My estimated PITIA will be just under 25% of my gross income. Should I put extra payments until PMI goes away? Down payment is about 18% and loan is at 4.99%.

• 11:40Speaker 02

  I'm gonna read this again because I was calling on PITIA, Principal Interest Taxes Insurance.

• 11:46Brian Preston?

  Association fees?

• 11:48Speaker 02

  Oh, is that what it is?

• 11:49Speaker 04

  That's what we were thinking, yes. Behind the scenes, in the wings, we were thinking that.

• 11:52Speaker 02

  So that's gonna be under 25% so I put extra payments until PMI goes away. Down payment is 18. Oh man, you're really close, right? I think it'd be worth, I think it'd be worth entertaining. Based on the size of the home that you're buying, what would it take to get 2% more? Like how much more capital would that be? And then run the calculation. I figure, okay, if I do 20% down and I void PMI altogether, what's the change in payment? Am I gonna take that savings and payment, put that money to work? Would that be worth the additional 2% that I had to save, had to put down on the house? I think being this close, I don't think it's a crazy mathematic to run.

• 12:29Brian Preston?

  But that's not the way he asked the question, Bo. He's saying that should he continue, I would assume after closing. Because I think what you're saying is if you can get the extra 2% before closing. But we all know, even if he starts throwing extra money, there is an entire process. You have to reach out to the lender to get them to remove the PMI. And I'm here to tell you, I think that realistically, if we're post-closing, it only takes a year to two years where all, just the. Appreciation of through inflation, you're going to have 20% and still have to go through the exact same process. So if you're trying to tell me from a lifestyle decision, you're going to forego having a Roth IRA, a fully funded Roth IRA versus going ahead and

• 13:13Brian Preston?

  throwing extra dollars at 24 years of age on PMI. I'd rather you just let it happen naturally and go through the process in a year, year and a half, two years. As a matter of fact, you might even want to go ahead and check in with your lender and say, hey, when is the first look back I can even have on getting PMI removed? Cause they might, you know, that's another reason why that might work against you throwing extra money now is they might have a certain period of time before they even give you that look back option. And there's probably going to be a cost.

• 13:41Speaker 02

  Yeah. And I'm hoping, cause 4.99% is a pretty good rate right now. So I don't know when you bought the home. I'm hoping they don't say something.

• 13:48Brian Preston?

  He's about to close. So I mean, you're, you still have the potential if he could come up with the 2%.

• 13:53Speaker 02

  Oh yeah. So he should, yeah. Okay.

• 13:55Brian Preston?

  That's not the way the question's written.

• 13:57Speaker 02

  I'd still, I would scramble to find the two. I agree with everything you said, and I would scramble to find the 2%. Or I'd do the math to scramble to find the 2%.

• 14:06Brian Preston?

  But if, what if he's closing next Friday?

• 14:09Speaker 02

  I'd do the math to scramble to find the 2%. I don't know how much house it is. It depends on what that, how much, what the dollar figure that is.

• 14:17Brian Preston?

  It's a lot of, it's a good problem to have, Ben.

• 14:20Speaker 04

  Good problem to have, Ben. If you would like a Tumblr, just email [email protected]. We'd love to send you one since we answered your question.

• 14:29Speaker 04

  All right. Next question is from Abra622. It says,

• 14:34Brian Preston?

  Say it with confidence. Abra622.

• 14:37Speaker 02

  There's no question.

• 14:37Brian Preston?

  Thanks for the question.

• 14:38Speaker 02

  Well, you read it with a question mark.

• 14:40Brian Preston?

  See?

• 14:40Speaker 04

  You heard it from Brian confidently. Abra622 asks, is there a Money Guy rule of thumb for how to handle overtime? I'm currently working around 60 hours a week. Should I save 25% of it? All of it? Should I use it on one-off projects? What do you think?

• 14:59Speaker 02

  Yeah, this is one of those things. It's why we love the 25% metric so much. When we talk about it, we say 25% of your gross income. If you're a part-time worker and you're only working half the time, it's 25% of the gross income. If you're an overtime worker, working overtime, we want you to be saving 25% of the gross income unless you're working overtime in this specific season for a specific purpose. Then it might be like, hey, I'm going to take a few extra shifts and work a little bit extra overtime because I know that I want to save for that next car, next, whatever the thing may be. We still want you saving those dollars, but you might be saving those for a short-term to intermediate-term goal as opposed to a long-term goal. But whatever

• 15:40Speaker 02

  your gross income is, we want you saving 25% of that amount.

• 15:46Brian Preston?

  So, Aubrey, your question is, does the Money Guy have a rule of thumb on how to handle the overtime? The answer is yes. It's called the Financial Order of Operations. What you should do with your next dollar is, because you very well, you're going to try to figure out, am I in step four? Am I in step five? And when you look at that, then yeah, you say, hey, I've got extra money coming in. Exactly what Bo said, run it through the filter. Am I trying to save and invest 25%? If you're, by the way, under $100,000 for a single individual, $200,000 for a married couple, you can take into account your employer's match with that money. You know, figure out and then, yeah, load up that money, that overtime. Let it fulfill what's going on with your army of dollar bills.

• 16:28Speaker 04

  Good stuff. Aubrey622, if you would like a Money Guy Tumblr, just email [email protected].

• 16:33Brian Preston?

  See, I feel like I can throw in a few actually. We've done so many rapid-fire segments that I think it's making us better to answer questions. We're getting faster. So I feel like we have to like, let's put in some other stuff in there just because we're going to go end up making through 26 questions.

• 16:47Speaker 02

  Do you have some other stuff that you want to put in there right now? Was that your lead into a tangent right there?

• 16:53Brian Preston?

  No, I mean, the only tangents, because I was, you know, I was at the beach last week. Which, by the way, did y'all know if you got the newsletter, they showed my beach view? But I found out that they cut out my feet. I guess they, I guess they're trying to tell me that I have ugly feet.

• 17:06Speaker 02

  No, just.

• 17:07Brian Preston?

  Now, they're, they're obviously swimmer's feet, because I'm built like a swimmer, but, but they must be ugly feet. Very functional over form.

• 17:14Speaker 02

  It's not an indictment on your feet. I just think that most people in their Saturday morning newsletter, while they're drinking their coffee, they don't want feet as their first picture. I just don't think that's the thing. I think beach.

• 17:25Speaker 04

  That wasn't the vibe.

• 17:26Speaker 02

  Cause you sent us a beautiful picture of the beach, but all that we could see were the ten little guys waving at us as opposed to the beautiful shoreline.

• 17:34Brian Preston?

  So, so just what's funny is perspective matters. So when I sent that message, I was like, God, team didn't even respond to me. It's kind of rude that nobody liked my, my beach photo. And then I come in today when we're doing our team, when we're doing our content meeting, and I found out y'all had, the reason the way it was responding is because y'all huddled up and were making fun of my ugly feet. So I was basically being picked on behind my back.

• 17:57Speaker 02

  You have wonderful looking feet. They're.

• 17:59Brian Preston?

  Very functional feet.

• 18:00Speaker 02

  They're not bad looking feet. They're great feet. I just don't know that feet are what you want in your beach picture. You ever like gone to someone's home and you see this like beautiful beach landscape and it's this wonderful portrait up there? There's never feet and toes in it. And that's what I'm saying. I think that it's not you. You're not the problem.

• 18:18Brian Preston?

  How would you know it's a photo from me though, if I didn't put something, you know, cause if, if you just take only landscape photos, those are boring photos from vacation. But if you put yourself in the photos, it's better.

• 18:28Speaker 02

  Even if your feet were in there, how are we gonna know it was you? We can't, no one's gonna identify you by your feet. You know how we knew the picture was from you?

• 18:36Brian Preston?

  My feet?

• 18:36Speaker 02

  Cause it came from Brian. Cause he sent it. You know what I mean? We're pretty much locked in on that one.

• 18:42Brian Preston?

  All right.

• 18:42Speaker 02

  I want to be very clear.

• 18:43Brian Preston?

  I didn't plan to have that tangent, but that's, that's what was going on in the content meeting.

• 18:47Speaker 02

  There were no derogatory comments made about your feet.

• 18:50Brian Preston?

  Y'all were laughing about my feet.

• 18:51Speaker 02

  No.

• 18:51Speaker 04

  No, it was more just that you, the feet were in the picture. That was it.

• 18:54Speaker 02

  What's funny, if.

• 18:55Speaker 04

  It was funny.

• 18:56Speaker 02

  Maybe, what, do we have some, in Discord, can we put the actual picture in?

• 19:00Brian Preston?

  No, I don't know if we need to do that. Now I'm a little self-conscious about my feet.

• 19:05Speaker 04

  You've been defending like, no, this is a great picture and now you don't want us to share it?

• 19:09Brian Preston?

  Well, I mean, I don't know. Now that I found out that there's an issue with feet, I don't know that it's a weird thing.

• 19:14Speaker 02

  There's not an issue with feet. It's just the picture, we don't want to detract from the picture.

• 19:18Brian Preston?

  All right, we've caught back up to being as slow as everybody anticipates.

• 19:21Speaker 04

  So wait, are we putting it in Moneyverse or not?

• 19:23Speaker 02

  Because what I was gonna say is-

• 19:24Brian Preston?

  I mean, I don't care. For the, for, for, for the crew, yeah, I would let y'all show my feet.

• 19:28Speaker 02

  I thought the funniest part of the picture, though, is that the way the shadow cast, it looked like you were wearing a wet suit. Like, it looked like you had long pants on. It was a fantastic picture. We're so thankful that even while you're laying on the beach, you didn't have to be thinking about us, but you were. And you're like, you know what?

• 19:43Speaker 04

  So nice.

• 19:44Speaker 02

  I want the team to enjoy the view that I have right now.

• 19:46Speaker 04

  So two things there. If you want to see the full picture that Brian is describing, go to moneyguy.com/moneysverse and join our free Discord server. Then you can talk about personal finance with us too.

• 19:58Brian Preston?

  You too can see Brian's big toes.

• 19:59Speaker 04

  So it's very fun. And you can see Brian's big toes. Woo, didn't think I'd be saying that. And then second of all, if you're not subscribed to our email newsletters, if you were, you would have already seen part of the beach picture on Saturday morning, along with a really nice write-up about our why and getting to do what you want to do because of making good financial decisions. But go to moneyguy.com and you can subscribe to our email newsletter too.

• 20:24Speaker 02

  You remember when you said we got so good at this?

• 20:27Speaker 04

  Yeah, I know. You just, you were like, we're doing so good. Let's just, let's derail it a little bit. But now let's get it back on the rails. We have a question from Foo Fighters 66 up next. It says, "Good morning, Brian and Bo. I'm 29 with one times saves." So I think he means one times his income saved.

• 20:44Brian Preston?

  He's out of the schedule.

• 20:46Speaker 04

  And he's on step five. "My dad, 65, invited me on a 5K moose hunting trip next October, likely his last." Oh, that's so sad. I don't like that we're already thinking through that. But he says, "I want to go, but feel guilty. Thoughts?"

• 21:04Speaker 02

  Go.

• 21:05Brian Preston?

  Also, you got until next, next October.

• 21:07Speaker 02

  Go.

• 21:08Brian Preston?

  I mean, so I would find out what the, how long you can stretch out the payments. But yeah, I mean, and then, and then also, you know, look, you know your parents' situation better. I mean, but tell them your concerns, but you're going to make it happen and see if there's essentially a dad scholarship too.

• 21:25Speaker 02

  Dad, I really want to go, but if you could foot the bill, that'd be awesome.

• 21:28Brian Preston?

  I mean, look, as a parent who's got now a graduated from college daughter who's, you know, gainfully employed and I know I'm gonna have to bribe her to probably, in the best possible way, I don't really mean it, she likes spending time with us, but I for sure will be doing nice things to try to help incentivize, just like I helped her fund her initial Roth contributions when she was younger and starting in the workforce, I think there's nothing wrong with, if your parents are in a good financial situation, just statistically, typically the parents are in a better financial situation than you just starting out. So that's the only reason, I'm not, I'm not trying to turn you into, you know, failure to launch, it's just one of those things that I thought was worth a conversation.

• 22:08Speaker 02

  I just think far too often, financial mutants, they miss out on some of the sweetness in life, and they miss on things they can't go back on because of the dollar figure. When I see $5,000 moose hunting trip, I don't know your financial situation, but I'm gonna argue that I would imagine 5,000 is not like an insurmountable cost to overcome. Now, this is different than you saying, "Hey, I want to go on a $50,000 safari with my dad." Then we'd have to like pull the reins in, that's a little aggressive, but 5,000, depending on your circumstance, might be a very realistic thing, where you're gonna have the opportunity in the future to make more money, to save more money, to be able to afford this trip. If this really is your dad's last hunting trip, you don't get to go back and have any more of this.

• 22:50Brian Preston?

  Here's, let me bring this into a better perspective, is that that's a big thing, like the big lifetime memory of blossoming memories, because we're not gonna be here forever, let's start putting, because that's a big thing, what small things can we do now to make this possible? Can you just take your, make your, you know, meal prep for the next, you know, three or four months, to where all of a sudden, you know, every month you're saving an extra 200 or 300 bucks, just because of the way you're structuring decisions, small decisions that you were already doing, you know, are there things that you can sacrifice in the short term that will help make this or cut the corner off of this, to where now maybe it's only $3,000 that's actually coming out of your savings, or 2,500 versus the full $5,000 because you're gonna make some lifestyle

• 23:35Brian Preston?

  decisions that make up for the rest of it?

• 23:38Speaker 02

  Yeah. I'm just so, I wouldn't miss the trip.

• 23:41Brian Preston?

  I wouldn't either.

• 23:42Speaker 04

  Here's the thing, he's saying he's, uh, he's got, already got one time his income saved. So he's slightly ahead of the curve. He's on step five, so he has an emergency fund. Sounds like you're employed. You know, I'm kinda like, you can make that happen.

• 23:56Speaker 02

  Yeah.

• 23:56Speaker 04

  We're not, we're like, we actually, money is just a tool to let you focus on what really matters.

• 24:00Speaker 02

  That's exactly right.

• 24:01Speaker 04

  Time with your dad.

• 24:02Brian Preston?

  I'd find a way to make it happen.

• 24:03Speaker 04

  I second that.

• 24:04Brian Preston?

  But I would, I would go turn over a few stones.

• 24:12Speaker 02

  What?

• 24:13Speaker 04

  I just, I thought Bo was gonna say something, but he just looked like he was going to.

• 24:16Speaker 02

  No.

• 24:17Speaker 04

  Well, great.

• 24:18Speaker 02

  That was a look of affirmation.

• 24:19Speaker 04

  Affirmation. Well, Foo Fighter 66, thank you for the question. Enjoy the hunting trip.

• 24:24Brian Preston?

  Go get your tumbler.

• 24:25Speaker 04

  And if you would like to bring, uh, you know, keep the coffee hot while you're on your hunting trip, just, uh, email winner at moneyguy.com and we'd love to send you a money guy tumbler.

• 24:33Speaker 02

  Where do you hunt for moose, Canada?

• 24:35Brian Preston?

  Somewhere where it's cold. I don't know.

• 24:38Speaker 02

  I guess north.

• 24:38Speaker 04

  I'm not a hunting expert, so I don't.

• 24:40Speaker 02

  The northern part of the United States, I think, have moose too.

• 24:42Brian Preston?

  I would never kill a moose.

• 24:43Speaker 04

  I don't know what permits and stuff are.

• 24:44Speaker 02

  You ever seen a moose?

• 24:46Brian Preston?

  No.

• 24:46Speaker 02

  I'm going to, um.

• 24:48Brian Preston?

  Only, only when I used to go to that crazy restaurant that had a fake moose that would talk to you.

• 24:52Speaker 04

  Oh my.

• 24:53Brian Preston?

  Um, it was like a steak restaurant.

• 24:55Speaker 02

  Oh, Stony River?

• 24:56Brian Preston?

  No, it was, had some crazy, had a different, I think they've got a business now, but there was a moose head that would talk to you every few minutes. No, it wasn't bull. Thanks, kid.

• 25:08Speaker 04

  Oh my goodness.

• 25:09Speaker 02

  I'm going to, I'm actually going to, uh.

• 25:10Brian Preston?

  Somebody in the comments, I guarantee will know what restaurant I'm talking about that went out of business.

• 25:15Speaker 02

  Later this summer, I'm going, uh, I'm going to Canada for the first time. Um, and moose is on my list. I would like to see, I don't think I've ever seen a moose in real life.

• 25:25Speaker 02

  Lots of Rocky and Bulling I've grown up.

• 25:29Speaker 04

  All right, well, we are gonna do another question, but it is also going to be time for our rapid fire segment very soon. So get your rapid fire questions into the chat. If you're watching live, be sure to put RF at the front of your questions, so we know that you want it to be a part of that segment. Um, and that'll be coming probably between the 30 and 40 minute mark, so stick around for that.

• 25:50Speaker 02

  Buckaboo Creek.

• 25:51Brian Preston?

  There it is.

• 25:52Speaker 02

  That's it.

• 25:52Brian Preston?

  I knew it. Somebody in the audience would know it.

• 25:55Speaker 02

  Because they had one at Stonecrest. That was the one that we always went to.

• 25:57Brian Preston?

  The one I'd go, there was one in Fayetteville, Georgia.

• 25:59Speaker 02

  They, Buckaboo Creek. Thank you, thank you, Paul Bigness.

• 26:03Speaker 04

  Someone said, "Sounds like an animatronic nightmare."

• 26:05Speaker 02

  That was, I remember, they had one, it was part of the new mall development.

• 26:10Speaker 04

  All right. Next question is from Gabib1992. Uh, I'm sorry, I'm supposed to say it with confidence, but I didn't.

• 26:19Speaker 02

  You don't think that's Georgia Bib?

• 26:22Brian Preston?

  Oh, George Bib, 1992. That's a good year, by the way.

• 26:26Speaker 04

  You can decide.

• 26:27Brian Preston?

  I graduated high school.

• 26:28Speaker 04

  The question says, "When investing in different account structures like HSA, 529, or Roth IRA, are you supposed to be invested in the same exact index funds throughout each account?"

• 26:43Brian Preston?

  Depends on where you are in your journey. In the beginning, um, the, the getting the money in the right account structures is more important. You know, just following the financial order of operations and just, you know, maxing out your Roth, setting up your 401K. All those things are more important than even the, the specific investment. So that's why we like broad index funds, whether it's the S and P 500, or if you're even one of those people who wants to use an index target retirement fund. But then down the road, as you build some wealth, you know, we, we're usually around step seven of the financial order of operations, you'll start thinking about the three buckets and the efficiency of those investments because of the taxes at that point. But in the beginning, I wouldn't get caught up in that.

• 27:25Brian Preston?

  I would choose a really good operating index fund and just let it rip.

• 27:29Speaker 02

  I agree with everything that you said. You want my hot take?

• 27:31Brian Preston?

  Yeah.

• 27:32Speaker 02

  You know, sometimes when you're taking a test and they ask a question and you jump on the answer real fast, but then when you read it again, you're like, whoa, this is a trick question. I think this is one of those. Because what's really interesting is the three account, he didn't say like, hey, when investing in different account structures, like a 401K, IRA, traditional IRA, Roth IRA, should you do it different? He actually laid out three different, or she laid out three different tax-free account structures. 529s are tax-free, Health SAVs accounts are tax-free, Ross are tax-free, which means that because they're taxed the same way, there's, it is likely that the types of indices, the types of investments you're going to use in those three specific type of accounts probably will be pretty similar.

• 28:15Speaker 02

  They probably will look kind of the same, again, depending on your timeline, because the 529, as you get closer to needing the dollars, will need to be dialed down a little bit.

• 28:25Brian Preston?

  That was the only one that I was going to draw attention to. That one seems a little different.

• 28:28Speaker 02

  If you're early on, your kids are not close to college age, I bet it's going to be a lot of low-cost index funds across all three of those because they're all taxed the same way. I think it was a trick question.

• 28:40Brian Preston?

  Yeah, I like that, but I would add the color that this is why I like in 529s, like, because remember, I think I'm somewhat of an expert now that I've had a daughter graduate college and we use the 529 to pay for it, is that I like the age-adjusted portfolios, the index variety. I was very fortunate that the provider of my 529s was using essentially index target retirement funds. And it was amazing how when we needed the money, it was there, and I love the fact that how it annualized and grew over those years. And those small, small contributions I made when she was a itty-bitty baby turned out to be and blossom into a great 529 that helped pay for the first three years of college completely.

• 29:23Speaker 04

  That is awesome. Well, Georgia Bib 1992, if you would like a Money Guy Tumblr, just email [email protected].

• 29:30Speaker 02

  I don't know if it was Georgia Bib.

• 29:32Speaker 04

  It was.

• 29:33Brian Preston?

  Yeah, but I like it. Get creative, with confidence.

• 29:35Speaker 04

  He said to say it with confidence, so I did.

• 29:36Brian Preston?

  And we're Georgia boys, you can highlight the Georgia. Georgia.

• 29:40Speaker 04

  G A Bib 1992 knows who he is.

• 29:42Speaker 02

  My nephew just graduated from University of Georgia this past.

• 29:45Brian Preston?

  Nice, go Dawgs.

• 29:46Speaker 02

  Dude, you know how fun it is watching a new grad walk through the arch for the first time? It was, it was very sentimental, it was awesome.

• 29:53Speaker 04

  Such a bulldog thing to say.

• 29:55Speaker 02

  I'm about to say you wouldn't know.

• 29:55Speaker 04

  No, I wouldn't know.

• 29:58Speaker 04

  All right. Next question is from the Bobby B22. It says, hi, money guys. You talk about always be buying.

• 30:05Brian Preston?

  That's right.

• 30:06Speaker 04

  If I can front load my 25 to 35% early in the year, can I take my foot off the gas to enjoy summers and holidays more? We'd still continue the 401k match.

• 30:19Brian Preston?

  Yes, Bobby, the only curve ball you have to watch out for is make sure your employer truly is going to give you that match is because we have actually seen plans to where they're structured, where they don't actually do the match, even if you front and load it, they cut off the contributions. We've seen that. So just make sure you do a little homework. But I'm okay if you, because statistically, it probably works out pretty good, you know, because eight out of 10 years, you know, you just have more money, more time for the money to work.

• 30:47Speaker 02

  Yeah, I was going to say, the only thing you're going to miss out on is if you're front and loading it consistently in the front of the year, you're going to miss out on some of the dollar cost averaging benefits. Like I'm thinking.

• 30:56Brian Preston?

  That's true, volatility.

• 30:57Speaker 02

  Fourth quarter of 2018, you know, is a big opportunity to be buying. So if you have money going in every month, but does it, are you still saving the appropriate amount if you're saving 25 to 30% in front and loading it so that you can take your foot off the gas later? Absolutely.

• 31:11Brian Preston?

  And then the behaviorally, just know thyself is that make sure you really are turning the spigot back on every year is because part of the set it, forget it that I like is, is that it kind of foolproofs you to a lot of the behavioral traps that we all fall into. And one of the ones, when you're doing things from a structured timing standpoint, you just forget about it. You get busy and then all of a sudden a month or two slips through the cracks. And you're like, wait a minute, I totally missed out on three or four months worth of savings. Just be careful with the behavioral stuff.

• 31:41Speaker 02

  You talked about the true up provision. Did you say the name true up provision?

• 31:44Brian Preston?

  No, I didn't say.

• 31:45Speaker 02

  What you want to ask your HR, if you're thinking about doing this, you want to ask, hey, do we have a true up provision? Meaning so long as I put in X percent of my salary, even if it's not going in per paycheck, will I still still get the employer match? If you, if your company does not have a true up, they make you have to have money going in, you could miss out. So it's a really quick. Email to HR, ask them, not all plans have them, not all plans don't have them. So you want, want to make sure you don't miss out on that money.

• 32:09Brian Preston?

  Yeah. I mean, we don't, I don't know if we need to explain that, but it's basically they're going to just apply the percentage each paycheck.

• 32:15Speaker 02

  That's right.

• 32:15Brian Preston?

  So if you front and load it, you're like, well, I got it all in there, but they might've only given it that percentage off of each of those paychecks and they're counting on giving you the rest later. But if you don't have any money going into the plan, you just don't get it because that's the way their matching is set up.

• 32:33Brian Preston?

  And it kind of stinks when it's like that.

• 32:34Speaker 02

  Oh yeah. Cause you miss out on free money.

• 32:38Speaker 04

  Well, the Bobby B22, hopefully that helps you think through that decision. And if you would like to drink from a money guy Tumblr while you consider this, you can just email winner at money guy.com and we will send you one as a thank you.

• 32:50Brian Preston?

  By the way, that was the most Bo and Brian thing ever. And the fact that I talk about the concept and you came up behind me and cleaned up the thing by saying, Hey, did you make sure you actually use the actual professional word that represents that concept?

• 33:04Brian Preston?

  This is why we work together well. Peanut butter and jelly.

• 33:07Speaker 02

  A lot of times people don't know the language, like, oh man, I got this great question. I want to ask my HR, but HR professionals are often not financial professionals. And so even when you ask them the question, oh, no, no, yeah, we get a match. And you want to be very specific because you want to make sure that it's like, it's kind of like artificial intelligence, the quality of the input will dictate the quality of the output. And so you want to make sure you're using the right vocabulary. So whoever asked them the question can get you the correct.

• 33:33Brian Preston?

  Yeah. Cause if you go and ask them, say, Hey, if I'm getting, if I put 6% in, I'm getting the full match, right? They're like, oh yeah, you're good. We match here. And you're like, no, no, no, let's get into the, the actual terminology.

• 33:44Speaker 02

  That's right.

• 33:47Speaker 00

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• 34:17Speaker 05

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• 34:46Speaker 04

  All right. Next question is from splo603. How do I know?

• 34:53Brian Preston?

  Splosh.

• 34:56Brian Preston?

  603.

• 34:57Speaker 04

  That's it. How do I know when I move on from step six to seven? My wife and I don't make enough to fill every account, but we are doing 25%. Are we on step seven? And can you expand on step seven? I'm 24, married and with 195K.

• 35:15Brian Preston?

  Wow. That's pretty awesome.

• 35:18Speaker 02

  24, married, 195. That's, you were certainly out ahead of the curve. Brian, you actually wrote the book on this.

• 35:24Brian Preston?

  Yes.

• 35:25Speaker 02

  You wrote the book on how to progress through this.

• 35:26Brian Preston?

  Yeah, the most improved chapter, when I was doing the original version of Millionaire Mission, was really step seven chapter. After I was like, man, that now hits a little differently. And by the way, yes, I'm gonna go ahead and answer for Splosh. You didn't put the T on there because that's not a special.

• 35:45Speaker 02

  You're about to make a tax joke. You're about to make a tax joke. Don't do it.

• 35:48Brian Preston?

  I won't make the Splosh joke. Sell tax joke. But I can't help myself.

• 35:53Speaker 04

  What a CPA, am I right?

• 35:56Brian Preston?

  Listen, you are definitely in step seven is because the 20, we've had this question come up because there's a lot of people that will make under a hundred thousand dollars that will never reach the 401K funding limit for the year, but they have definitely reached the 25% savings rate, especially if you include your employer match. So you should move to step seven, which the whole purpose of hyper accumulation or step seven is now instead of you thinking in the, because steps one through Six are all very reaction or cause and effect, meaning that we gotta have emergency reserves to keep you from making desperate decisions. We've got to get the free money from your employer because it's just that valuable. You can't pay a bank 20% plus

• 36:39Brian Preston?

  percent and expect to be successful. That's why step three is set up the way it is. Emergency reserves keeps you, helps you in case you get unemployed. Tax-free growth or tax favored growth in step six are just too valuable not to pay attention to. Step seven is the first one of the steps that you get to take a breath and say, wait a minute. Okay, all this has been cause and effect because of the tax policy or keeping myself out of the ditch. Now, what's, how are we actually going to use this money? And that's where you get to take a deep breath and think about what's the ultimate goal for this money? Do I have the right account structure that's actually going to let me use that money in that way? And it's kind of a way for you to catch your breath, know how you're going to use the money before you start moving on to step eight, which is those prepaid expenses

• 37:22Brian Preston?

  or abundance goals. And you once again get to work thinking about now how we're going to be using that money, even if it's outside of boring stuff like steps one through six are.

• 37:35Speaker 02

  That was a fantastic answer. If you want to know even more, like if you'd like to know more, I'd encourage you if not picked up a copy of Midriff Mission, it's a great read. You can read through that chapter, actually understand that. Or if you want to do a deep dive on the Financial Order of Operations, you go to learn.moneyguy.com. Go take the Financial Order of Operations course and actually see, okay, this is what went into it. This is how it was designed because it kind of walks you through that level of detail for each one of the steps that we work through.

• 38:03Brian Preston?

  And remember when we did the food course redesign last year, we gutted the price on purpose because even though we made it much, much better and I felt like modernized and streamlined it, we gutted the price because we were trying to make it that much more approachable for everybody. We realized, hey, it's not about the money we're making off. It's more about getting more people in front of it.

• 38:22Speaker 02

  Exactly right.

• 38:24Speaker 04

  That's great. Well, splo603, or Splos603, thank you so much for the question. Just email [email protected] if you would like a Money Guy Tumblr. Before we get to our "It Does Not Depend" rapid-fire segment, what? What are you looking at me for?

• 38:39Brian Preston?

  No, no, it's just us. Keep going. You're great.

• 38:42Speaker 04

  Okay. I was gonna say, we have a couple of really fun collabs coming up this week that I thought we should shout out.

• 38:49Brian Preston?

  Tell me more.

• 38:50Speaker 04

  Tomorrow, your episode with Marriage, Kids, and Money is gonna come out where we talk about FIRE.

• 38:55Brian Preston?

  It was awesome.

• 38:55Speaker 04

  So go check out Marriage, Kids, and Money with Andy Hill. And then, I believe on Sunday, your episode with Iced Coffee Hour is coming out, where you guys respond to some portfolio. I mean, you guys talk about so much stuff about investing.

• 39:06Brian Preston?

  Yeah, well, you know, because we went on Iced Coffee Hour again. They came in town, saw us.

• 39:13Brian Preston?

  Jack and Graham actually let us see their portfolios and got our opinions on them.

• 39:17Speaker 02

  Hey, what do you guys think about these?

• 39:18Brian Preston?

  If you want to see what we did, and I mean, look, and Bo was nice to them, but he also pointed out some blind spots that they might have.

• 39:27Speaker 02

  They asked for our opinion of what they're both doing financially in their portfolios, and we gave it to them.

• 39:32Brian Preston?

  What's funny is that we're still getting texts from specifically Jack. He's very hot and heavy on a specific strategy. It will be interesting to see how it plays out.

• 39:42Speaker 04

  Yeah. So, really good stuff coming up from two fellow financial creators. Actually, we have a few collabs coming up. I won't give them away yet. But we'd love to hear who you think we should collab with next.

• 39:55Brian Preston?

  Oh, that's a great question.

• 39:55Speaker 04

  It's always fun to meet different people in this space, even with different ideas sometimes. It's just fun to discuss and get to know them. And a lot of the time, you guys have given us some really wonderful ideas. So let us know who we should meet and collab with next.

• 40:08Brian Preston?

  Because, you know, there's things like, I think about content creators that, like, every Saturday, I watch Disney Food Blog with AJ. I've been trying to, forever trying to figure out, what's collab thing can I do with her? But I couldn't, I couldn't figure out how to make it work because I don't, I don't know. But there's, but I would definitely be open for us coming creative collaborations that we should be doing because it's good for everybody. You know, what's great about collabs is that you get to, you guys get introduced to somebody else who could hopefully add value to you, but then also, we get introduced to their audience as well. So if you have any creative ideas, we're always open to thinking about those things.

• 40:48Speaker 04

  Yeah. It's fun to hear what you guys are thinking. So I just wanted to throw that out there. All right. It is now time for our "It Does Not Depend" rapid fire segment, where Brian and Bo collectively have 30 seconds to answer your financial questions, and they cannot say the phrase "it depends," or "they are out," or something like that. And then at the very end of the rapid fire segment, we will move on to our "Maybe It Does Depend" segment, where they can say any of the things they felt like they just really needed to say, but didn't have time to. So, that is what we're gonna do. We are going to put 30 seconds on the clock, and after I ask the first question, we will be off to the races. Are you guys ready?

• 41:31Brian Preston?

  Yeah.

• 41:31Speaker 04

  Brian, why do you always look nervous? You're being too good at this, honestly.

• 41:34Brian Preston?

  It's only the first question.

• 41:35Speaker 04

  Okay.

• 41:36Brian Preston?

  Kind of like you give you, you know, you get a shot from the doctor. It only hurts for the first second.

• 41:40Speaker 04

  Oh, okay.

• 41:42Speaker 02

  It's like the first shot only hurts. I was like, "How many shots you give when you go?" What are we... Are you going first, or am I going first?

• 41:52Brian Preston?

  I'll go first. Get out of the way.

• 41:53Speaker 04

  Okay. Question one. Is there ever a case for investing in a fixed index annuity? If yes, when would this be?

• 42:04Brian Preston?

  Yeah, when interest rates are really above average high, and you'd like to protect a chunk of the portfolio, because you don't have a pension or some other cash flow thing that takes out the volatility.

• 42:18Speaker 02

  For very super risk averse investors, who are terrified of any sort of market loss, but they need to turn a pot of assets into an income stream, annuities, specifically immediate fixed annuities, can be solutions for people in that scenario.

• 42:34Speaker 04

  Next question. What's your money vice? Something you enjoy spending on without a second thought?

• 42:41Speaker 02

  Convenience. I am at the stage in life where if I can spend some money to have something done, or something done on my behalf, or something done more efficiently, I love the idea of convenience. I love of being able to buy back my own time.

• 42:59Brian Preston?

  Crud.

• 43:00Speaker 02

  Gadgets.

• 43:03Brian Preston?

  Yeah, but what's the last gadget I bought?

• 43:05Speaker 02

  Your watch?

• 43:07Brian Preston?

  Oh, yeah, I guess, okay.

• 43:08Speaker 04

  You do love a good gadget.

• 43:09Brian Preston?

  I buy gadgets.

• 43:10Speaker 04

  We're gonna go gadget and that's time.

• 43:12Brian Preston?

  It was a splurge.

• 43:13Speaker 04

  Time is up. All right.

• 43:15Speaker 02

  How about experiences? How about going to theme parks? How about going on cruises?

• 43:18Speaker 04

  We'll come back to that one.

• 43:19Brian Preston?

  Oh, that's what I should, I should say.

• 43:20Speaker 04

  No, no, no, no, no, no, no, we'll come back to it. We have time's up. Okay. Next question, around what percent of your clients are on the FIRE path? What is the average retirement age you see? What's it like in the real world?

• 43:32Speaker 02

  I will be honest, a much fewer of our clients are true FIRE, like financial independence, retire early, do nothing. We do have a lot of fine people because they are such diligent savers that when they get into their late 40s, mid 50s, they now have the opportunity, they can either leave the job they have been doing or focus on their next endeavor.

• 43:52Brian Preston?

  Yeah, I would say, I mean, most of our clients are before 65, which is traditional. So I think a large percentage are before 65. We don't have, I can't think of any under 50, though.

• 44:04Speaker 02

  I have a, I have a handful.

• 44:06Brian Preston?

  Okay, nevermind.

• 44:06Speaker 02

  I have a handful.

• 44:07Brian Preston?

  Disregard.

• 44:11Speaker 04

  Uh, next question, is Roth 401K always the move if you will receive a pension when you retire?

• 44:18Brian Preston?

  Yeah, I love Roth IRAs because of also, assuming, you know, you've taken into account all the tax implications, the, because of the legacy, the tax-free growth, there's a lot of power with all Roth accounts.

• 44:31Speaker 02

  I don't like "all" whenever we say that. Uh, I would say if you're in a very high tax bracket, even if you have a pension, it would behoove you to save on a pre-tax basis, especially for the 30% plus tax bracket, because you get 30% tax savings this year, even if you are gonna have pensionable income later on in life.

• 44:49Speaker 04

  All right, next question, is it worth it to participate in my company stock purchase plan if the discount is only 5% and the money is held for three months with no interest?

• 45:00Speaker 02

  How much free money is not enough free money? You know what I mean? Because 5% is still free money and even if you hold it for three months, it's still a relatively minimal amount of period. It does sound, without knowing the other circumstances, I would say the ESPP is likely still falling into step two of the Financial Order of Operations.

• 45:15Brian Preston?

  Well, also, that 5% discount, is it before or, because a lot of times it's the lower of either the beginning of the quarter or the end of the quarter, that might be enough juice to really push it over.

• 45:28Speaker 04

  You guys are getting very good at this. Well done. Crushing it.

• 45:30Speaker 02

  Whatever. We're having, we got a bunch of "it not depends" to double back on.

• 45:35Speaker 04

  I do have two listed, so if there's more, let me know.

• 45:38Speaker 02

  I can't talk.

• 45:39Speaker 04

  All right, next question. Where is the best place to invest my money if I need to access it in five years?

• 45:46Brian Preston?

  I mean, five years is right there on the line. It's probably going to be a balanced of some index funds, but a lot of liquidity so that you can offset the, any crazy things that happen from a timing perspective.

• 45:59Speaker 02

  I still think that right now, the most attractive cash holding are high yield money market mutual funds. Most of them are paying somewhere between 3.4, 3.7%. Inside of five years, that's where I would hold my cash. That's where I am holding my cash.

• 46:14Speaker 04

  With two seconds to spare.

• 46:16Brian Preston?

  There's more to add on that one, potentially.

• 46:19Speaker 04

  All right, I'll make a note.

• 46:20Brian Preston?

  But it's hard, because that gets into financial planning.

• 46:22Speaker 04

  Oh my goodness, you guys.

• 46:24Brian Preston?

  Might as well say it depends.

• 46:26Speaker 04

  Fired. Okay. Next question. Step eight. I'm in step eight, have 220K in a brokerage, intending to fund 100 to 150K of college, starting in seven years. When and how should I start de-risking?

• 46:42Speaker 02

  Just like we talk about putting money to work by dollar cost averaging, whenever I know I have some sort of goal that's going to happen, I like the idea of reverse dollar cost averaging. So if I think that I've got seven years to do this, I may begin slowly backing down the risk on monthly, quarterly, annual, you figure out the cadence basis, to get to that thing by the time I get there.

• 47:02Brian Preston?

  The only other thing I was gonna say, without saying the dirty word we're not allowed to say, is make sure you really are in step eight. That's where it's step seven is for you to actually compare what you have to your goals, to make sure you're not derailed.

• 47:14Speaker 04

  One second over, but I'll give it to you. Okay. Next question says, Money Guy team, what do you mean by graduating from target retirement funds? What's next after that?

• 47:28Brian Preston?

  Well, I think there's even more tax efficient with your investments because Roth, you love the tax-free growth. After-tax, you love the liquidity and access to it. And then tax-deferred, you know, it's the least tax-efficient.

• 47:44Speaker 02

  A target retirement fund is a generalized portfolio solution. Once you graduate past that, you move to a personalized, specific portfolio allocation meant just for you, based on your income account structure, availability, goals, time horizon, risk tolerance, risk capacity. That was good.

• 48:00Speaker 04

  Two seconds over. I guess I'll give that to you, too. Next question says, should we calculate savings rate off of gross income minus daycare expenses? If the daycare expense is large and makes saving 25% hard?

• 48:15Speaker 02

  No, you should not subtract it off, but you should give yourself some grace. This is a period. This is a season. You may not be able to save 25% right now, and that's okay. Go to moneyguy.com/resources, check out our "How Much Should You Save" deliverable. Even if you're young and you're not saving 25%, there's a good chance at lower savings rates, you still get where you want to be later in life.

• 48:33Brian Preston?

  That's why we like the gross is because it doesn't let you do any of the what-ifs that a lot of people do. People hate that we use gross, but it's specifically for these purposes.

• 48:46Speaker 04

  Right on time, even with the speedy talking. Man, if anybody's listening on one and a half or two times speed, listening back.

• 48:53Brian Preston?

  I felt like Bo just transformed himself into the Micro Machines disclosure guy.

• 48:58Speaker 04

  We may revisit that in the ending segment.

• 48:59Speaker 02

  It's only the last seven or eight seconds. I'm good for the first, like, you know, seven seconds.

• 49:04Speaker 04

  All right. Next question. Should I combine retirement accounts from old employers or leave them be, and why?

• 49:11Brian Preston?

  Go to moneyguy.com/resources. We have a great flowchart for you to answer a few yes/no questions, and you'll know the specific answer for your situation because it does have variability.

• 49:22Speaker 02

  Four things you can do when you leave an employer. You can cash it out. Don't do that. You can leave it where it is. You can roll it to your new employer. You can roll it to an IRA rollover. The deliverable Brian just said will walk you exactly through how to make that decision.

• 49:35Speaker 04

  Well done. Man, that resource really did the heavy lifting on that, but it is a great resource. Moneyguy.com/resources.

• 49:40Brian Preston?

  It's a flowchart. It's going to ask you yes/no questions. That takes out the "it depends."

• 49:45Speaker 04

  All right. Last but not least, what do you guys like to do on your days off?

• 49:52Brian Preston?

  I mean, me and my daughter like to do errands, whether it's washing cars, going to pick strawberries, whatever you pick fruit is available. That's what we like to do on the weekends.

• 50:02Speaker 02

  Yeah, on days off for us, it's family time. We are still very much in the messy middle. So we're spending a lot of time in the pool right now, hanging out, doing that, being outside, going for walks, trying to drink in these kids' youth. My oldest is about to be 11 and I'm like, holy cow, she's, ah, it's like seven more years, seven more summers, seven more Christmases, ah.

• 50:22Brian Preston?

  I also, because we're over, but it's the last question. I appreciate that my wife does usually a once a week date night plan. Like she, she just puts together something with a neighbor or a friend and that's, that's pretty cool, too.

• 50:36Speaker 04

  Very good. Well, that concludes our it does not depend rapid fire segment. Thank you for your submissions and questions. Let's now go into our maybe it does depend segment where we can talk about all the things you didn't get to say. I have a few marked.

• 50:49Brian Preston?

  Can I go back to 12 though? Cause even my own mom.

• 50:55Brian Preston?

  Cause I had a bunch of family in town for graduation and mom was like, so do you and Bo hang out on the weekend? My own mom says this. And I'm like, no.

• 51:06Speaker 02

  We don't purposely not.

• 51:07Brian Preston?

  So y'all don't like each other? And I was like, I was like, mom, we hang out like every day for hours. And matter of fact, my productivity gets killed because I'm in Bo's office talking all the time. I was like, but on the weekends, we typically are doing independent stuff and it doesn't mean that.

• 51:22Speaker 02

  It's not on purpose though. We don't avoid each other on the weekends.

• 51:24Brian Preston?

  Still like, but what's funny is Bo and I have vacation and you should know, I didn't even told you this. So it'll be on air. It'll be the first. My wife was talking, cause we were, we were on a, you know, a trip, just me and her last week. And she's like, we ought to once a year do a trip with Bo and I was about to say. He's like, just because that would be really good to make sure that we, we, cause we do get busy doing so many things that sometimes I feel like we, we don't do enough stuff out of the office.

• 51:50Speaker 02

  I'm for it. Then you heard it right here. We're gonna do it.

• 51:54Speaker 04

  They do indeed like each other. In case there was any question.

• 51:57Brian Preston?

  There's some funny stories. I mean, that's also when the funniest stories, like your swimming ability and so forth came up from the last couple trip.

• 52:04Speaker 04

  Just think of the stories you could generate, the tangents we could have. All right. Well, we did ask a question about what's your money vice? And I believe we ran out of time about so, oh, and Brian couldn't think of anything.

• 52:17Speaker 02

  Well, Brian couldn't think of anything.

• 52:18Brian Preston?

  I should have said theme parks.

• 52:20Speaker 02

  Theme parks.

• 52:20Brian Preston?

  Yeah. Theme parks are a huge money vice.

• 52:22Speaker 04

  Experiences, theme parks.

• 52:23Speaker 02

  You love cruises too.

• 52:24Brian Preston?

  I do like cruises as well.

• 52:26Speaker 04

  Something you can take your family to that's a big fun generator.

• 52:29Brian Preston?

  Yeah.

• 52:30Speaker 04

  You will go for that.

• 52:30Brian Preston?

  I think sometimes my wife, God bless her, she's, cause those things, if you think about, I am definitely a stimulus seeker. And so is our youngest daughter. So we love like high volume, high energy stuff all the time. And my wife is like, oh my gosh. That's why I think she loved that we went to the beach last week.

• 52:47Speaker 02

  Yeah.

• 52:48Brian Preston?

  Meanwhile, after day one, I got it, we got, we didn't get into a fight, but she was definitely disappointed. Cause like tomorrow, we're going to have to find something else for me to do because I can only hang out on the beach. One day I'll start twitching.

• 52:59Speaker 02

  You're not like a sit on the umbrella read kinda guy?

• 53:02Brian Preston?

  No, I just sat there and watched the, the water go in and out, in and out. And then it's like, all right, all right, this is pretty cool. What time is lunch? You know, it's just, I don't know, in and out.

• 53:16Speaker 02

  Do you ever, uh, do you like snorkel and stuff? Is that a thing you do or no?

• 53:20Brian Preston?

  Well, yeah, I mean, I don't have a problem doing it. It's just that water was a little chilled.

• 53:24Speaker 02

  Ah, got it.

• 53:25Brian Preston?

  I didn't, I didn't think it had enough sun on it yet in the season.

• 53:28Speaker 02

  Cause I'll tell you, down there at the equator a few weeks ago, it was perfect. So that's what we did. We were like, hang out and we'd go snorkel and go do that.

• 53:35Brian Preston?

  No, I do like, cause you know, a few years ago, we do it on a catamaran within the Grindin Islands. And I love, actually it's one of the only vacations that I lost weight on. Now there's other reasons too, but it's, um, but it was, um, it was a lot of great snorkeling.

• 53:52Speaker 04

  We'll just leave that up to your imagination. All right. There was another question.

• 53:56Brian Preston?

  Yeah. Don't do a catamaran trip like I did it with the small, small, small, small catamaran.

• 54:03Speaker 04

  Oh my goodness. Okay, moving back to personal finance, there was another question you guys kinda kept talking on and I stopped you about like what age your clients are retiring. Did you have anything else you wanted to say on that one?

• 54:16Speaker 02

  About what?

• 54:16Speaker 04

  And what it looks like in real life?

• 54:18Speaker 02

  Oh, what does fire look like in real life? Was that the one?

• 54:21Brian Preston?

  Yeah, you were saying, cause I said, we don't have any clients really under 50 who are retiring. You're like, well, I do.

• 54:25Speaker 02

  Yeah, we actually had someone in the chat say, hey, I'm a client. I'm under 50. No, no, no, that's not what I meant.

• 54:30Brian Preston?

  Don't let the old guy say something.

• 54:32Speaker 02

  People that are like truly pursuing fire, like I want to work aggressively for 10 years, 15 years and be out of the workforce forever. What we most often have, we have a lot of like very high earners, very esteemed folks who want to do sabbaticals. Hey, I want to take a year off, take two years off. We have a number of clients that have done that a number of times now.

• 54:49Brian Preston?

  I got a client buying a Sprinter van right now.

• 54:50Speaker 02

  Yeah, and then we have some that are like, hey, I've reached financial independence, so now I get to choose what I do with my time based on what I want to do, not what I have to do. For some people, it's continue to the same job because they love it. For others, it's shifting and volunteering or doing family stuff or whatever that thing may be. We do have a lot of folks that fall into that camp, but it's because they've figured out saving early and often. It's given them flexibility and options later on in life.

• 55:17Speaker 04

  So do you think like by definition, there are a lot of fire, like people retiring before or going to the next endeavor before 65? But maybe they're not that traditional idea of like, I'm fire and I'm saving 60% of my income and like that kind of thing?

• 55:30Speaker 02

  Yeah, like I don't.

• 55:31Speaker 04

  It just looks different?

• 55:32Speaker 02

  I don't think I have any people like in my ecosystem that like have young children that are like fully checked out and done working.

• 55:41Speaker 04

  Sure.

• 55:41Speaker 02

  You know what I mean?

• 55:42Speaker 04

  Yeah.

• 55:42Speaker 02

  Like maybe like older high school, college age, but like I don't have any like fire people pushing a stroller and they're done, they're out.

• 55:48Brian Preston?

  I mean, look, I'll ruin it for everybody is because this is what you ought to understand. You need, if, the ideal is you get as much money as you can in an early enough age. So you own your time that much sooner. And I think you'll find out that most people, when you get to the point that money is nothing, but just a tool that you're using, it's not something that controls you having to wake up to go to work anymore. You're still going to want to wake up and know what you're doing is having an impact in the world.

• 56:15Speaker 02

  That's right.

• 56:15Brian Preston?

  At least that's what I have found is when I got to the top of the mountain and realized, oh, I have the level of money that I always thought I wanted is that it's not as cool as you think that you can just go buy anything. You need to have purpose. You need to have why. You need to have, there's more to it than that. And that's why I think a lot of people don't actually just completely tap out is because that seems not as cool as you think it is too. I think a lot of us have that daydream because you're stressed out. You don't control and own your time yet. So what do we do? It's the same thing when I was growing up, my dad used to, because he was in a high stress situation at work and we'd be on a, you know, riding down the street and he'd be like, you see that, that guy mowing grass on the interstate? I wish I had his job.

• 56:57Brian Preston?

  And that's, you know, we all fantasize in some way to take the stress away. And that's why I try to give you the tools to go own your time that much sooner because when you truly do things because you want to and you have the power of, you can say no to anything and everything, it, it just hits differently. And that's what, that's what I try to, to get to people. It's not really tapping out. It's just owning your time that much sooner.

• 57:20Speaker 02

  That's right.

• 57:20Speaker 04

  Yeah, that was good. Um, I also had a note to come back to where is the best place to invest my money if I need to access it in five years? Did you have anything else to say?

• 57:29Speaker 02

  I throw the thing about like, I keep all my liquid cash in a high yield money market mutual fund right now is the best place. And that's where I keep my like sub five year goals, but you said there was more you wanted to add to that.

• 57:39Brian Preston?

  Well, I was just saying, sometimes when you have a sinking fund or something where it's like five years in the future, you probably could put 20% into, 20% of that or 30% of that depending upon your risk, you know, variance or how hard it would hit you if all of a sudden that money was, you needed it and it was a downturn, you could try to, to juice things a little bit.

• 57:59Speaker 02

  Sure.

• 57:59Brian Preston?

  I mean, we are, think about some of our debt. You and I have some debt goals that we're paying down some commercial real estate. We've put some of that money in the market.

• 58:08Speaker 02

  For sure.

• 58:08Brian Preston?

  And even though we know it's coming up in the not too far future. So I mean, that's why I think there's nothing wrong with having a balanced approach to try to take advantage. Now, with that said, is if we're, if we get within three years of when we think we're paying off this debt and the market's at all time highs, we might start winding it down. Um, because we, you know, remember pigs get fat, hogs get slaughtered.

• 58:32Speaker 02

  That's right.

• 58:33Brian Preston?

  Oh, the only other thing I had on here, Rebe, was, I think it was question number eight on the rapid fire. Was we were talking about, should you do Roth?

• 58:41Speaker 02

  Roth 401K, read that question again.

• 58:44Speaker 04

  Roth, it was number eight?

• 58:46Speaker 02

  It was.

• 58:47Brian Preston?

  I was just gonna say Roth is my favorite child. I know as a parent, you're not supposed to name your favorite children, but of all account structures, I love Roth.

• 58:54Speaker 02

  It was the number second rapid fire question, but I think he wrote his eighth question overall.

• 58:58Brian Preston?

  Oh yeah, no, you're right.

• 59:00Speaker 02

  So it was the second bracket rapid fire question.

• 59:03Brian Preston?

  That was the eighth question of the day.

• 59:04Speaker 02

  The third one, first one was fixed indexed annuity, second one was something else.

• 59:08Speaker 04

  Money advice.

• 59:10Speaker 02

  Hey, should I invest all of my money into Roth 401K?

• 59:12Speaker 04

  Oh, yes, not number four, one, okay, yeah, wow. We're speaking a different language there.

• 59:17Speaker 02

  Should I only invest in Roth 401K if I'm gonna have a pension later on? I said, hey, if you're a really high income individual, even if you are gonna have a pension, I think there's merit to getting the current present year tax benefit doing that was the position.

• 59:28Brian Preston?

  Sure, cuz you can do Roth conversions down the road, but I just, I didn't wanna poo poo on Roth dollars cuz they are my favorite children.

• 59:35Speaker 02

  Well, we would never poo poo on it, but he, but the question was, I think the word all was in there, right? Like, it's like this exclusivity. If, if it makes sense to do all Roth, for sure. But the time when it doesn't make sense to do all Roth is if you're in a very high tax bracket, Roth can be costly. And so I would still think about maybe maxing out the pre-tax and then doing some backdoor stuff and, and that sort of thing.

• 59:58Speaker 04

  Well, that concludes our maybe it does not depend segment.

• 1:00:02Brian Preston?

  You want to do one more?

• 1:00:03Speaker 02

  I'd say that was our best one.

• 1:00:06Brian Preston?

  Really?

• 1:00:07Speaker 04

  You did pack a lot of meat into that rapid fire segment.

• 1:00:10Speaker 02

  I thought we did really good.

• 1:00:11Speaker 04

  It was good.

• 1:00:11Speaker 02

  Not to toot our own horns, but.

• 1:00:13Speaker 04

  But yes, let's do one more question.

• 1:00:14Brian Preston?

  Let's do one more question before we close this thing out.

• 1:00:17Speaker 04

  Um, this one says, Brian has mentioned, oh, this is from Tim R. Tim says, Brian has mentioned able accounts in the past, but only briefly. When are they appropriate and when are they inappropriate? We may be eligible to contribute, but if we become ineligible, it seems bad. Do you have anything to say to them or point them to?

• 1:00:38Speaker 02

  Before you answer that question, um, because I think it'd be helpful you to explain what an able account is, how it operates, we, we've released, the thing that I'm thinking of is.

• 1:00:46Speaker 04

  Yes, that's why I knew you were going to talk about it.

• 1:00:49Brian Preston?

  But what Bo's alluding to, we have a great resource. By the way, if you have, anybody who has a special needs child or developmentally challenged child, we'd encourage you to go to moneyguy.com/resources. We actually wrote an ebook and originally when we did it, we were like, we were going to sell it. And but then we're like, no, no, no, this is too valuable. So we're just giving it away. So if you just go out there and, and, you know, check it out. Now, look, it's not going to be the ultimate end all, but I think if you're just on this journey and you need something to kind of give you some overviews of some very key important concepts, go out there, please, because that's what the heart of this one we designed it was.

• 1:01:29Brian Preston?

  Because I'm on this journey myself and, um, you've heard me talk about it in Millionaire Mission. I've talked about on the show is I don't have to save for one retirement. I have to save for essentially two retirements because after I leave, I know whatever I have saved up or built up is, it has to provide also for my, my youngest daughter.

• 1:01:49Brian Preston?

  I like able accounts because the way these things were designed, and this is what Bo was alluding to. You know, years ago, they came up with 529s to help pay for college. Congress got together and said, hey, we need to, we need to incentivize families to be able to afford the rising cost of education. Let's come up with 529s. And the way that that structure was is that. However, you put money into these 529s, if you used it for qualified education expenses, it would be completely tax-free when you pulled the money out. Well, then somebody in Congress said, you know what? That 529 program worked out so well. Let's use the same code section, but let's make it for disabled, you know, people who have disabled children or family members. And they started off and it was a pretty, it was a pretty tight qualification,

• 1:02:31Brian Preston?

  but they've actually unbundled that and made it even easier to qualify. I think originally it was like under 26. Now they've pushed that up into the 40s.

• 1:02:39Speaker 02

  Oh, wow.

• 1:02:39Brian Preston?

  Or beyond so, and then also earned income. Or if you know, if your, if your disabled child had earned income, that would limit you to some degree. They've lifted that out to a degree. But the way these things are going to work is that you can put money in. Now you don't get a, you don't get a deduction or anything. But you do get, they grow completely tax-free, tax-deferred. And if you use it for qualified expenses, which is pretty broad for, for disabled individuals, you can pull it out completely tax-free. And they also, up to the first $100,000, it's not going to disqualify you from social security and other, you know, federal benefits you might be entitled to. Now there are limits. What I found is that when I started funding this, there was a state limit to how much you, these accounts could grow,

• 1:03:23Brian Preston?

  but they've been indexing that.

• 1:03:25Speaker 02

  Like how big they could be overall.

• 1:03:26Brian Preston?

  But they keep indexing it for inflation and I haven't run into an issue because I was at first loading this up. I have pulled back to a degree because now I'm doing more complicated estate planning. And there are limits and that's why you'll need to work with your specific situation. But I think for most people, it's, it's a pretty good while before you have to worry about that. And there is a, that website, and I screw this up every time. I think it's NRCC.org?

• 1:03:54Speaker 02

  Is it? Dot org?

• 1:03:56Brian Preston?

  Yeah, is it?

• 1:03:59Brian Preston?

  Is it? No, that's

• 1:04:00Speaker 02

  That's not it.

• 1:04:01Brian Preston?

  Type in

• 1:04:03Speaker 02

  Able.

• 1:04:03Brian Preston?

  Able accounts, national resources. This is the problem with doing a live show.

• 1:04:08Speaker 02

  That's okay. Keep, keep talking and I'll, uh, uh, able, A B L E N R C dot org. A B L E N R C dot org.

• 1:04:16Brian Preston?

  Yeah. If you go check it, that great website. It lets you even go state specific because there are different rules depending upon, just like 529s are state specific. Able accounts are state specific as well. So you need, that's why I love a good aggregation website that kind of gives you an overview. Um, and I'm very proud of, state of Tennessee was one of the front running, um, states, very proactive on it. And, and I've been very pleased with their plan.

• 1:04:40Speaker 02

  Great.

• 1:04:41Brian Preston?

  Did that help?

• 1:04:42Speaker 02

  Yeah, that was awesome.

• 1:04:43Speaker 04

  It was great. Uh, Tim, thank you for the question. Uh, if you would like a money guy Tumblr as a thank you, email winner at money guy.com. We'd love to send you one. And for anyone curious about able accounts and more of the things that Brian was talking about, remember we do have that deep dive ebook for free at money guy.com slash resources. Uh, so

• 1:05:02Brian Preston?

  By the way, somebody turn on the bat signal. I hear that Aaron talks money was in the room too.

• 1:05:05Speaker 04

  She was.

• 1:05:06Brian Preston?

  So she heard we were talking about collaborators and she's like, ooh, let me get in there on that.

• 1:05:10Speaker 04

  She must. I said, Aaron, uh, some folks were saying we should collab. What do you think? And she said, yes.

• 1:05:15Speaker 02

  Oh, man, that's a great idea. We should, we should do that.

• 1:05:19Brian Preston?

  Y'all are so bad at it.

• 1:05:20Speaker 04

  I'm just saying it's an idea.

• 1:05:21Speaker 02

  Awesome. We should do that.

• 1:05:23Speaker 04

  It's a great idea, actually.

• 1:05:26Speaker 04

  I think we should talk about that.

• 1:05:28Brian Preston?

  So spontaneous.

• 1:05:29Speaker 02

  And look, if we did, if we happen to collab with Aaron, the way that you're going to know about it is if you subscribe to the channel right now, if you have not subscribed, if you're just renting your seat, make sure you click that subscribe button. So when we have new content come out, by the way,

• 1:05:43Brian Preston?

  Forty-eight percent.

• 1:05:44Speaker 02

  Only thing.

• 1:05:45Brian Preston?

  Last night.

• 1:05:45Speaker 02

  The only thing that comes out on this channel is new and original content. So you will not get overrun. You will not get overloaded. Make sure you subscribe so that one, we know you're out there and two, you can get updates when we have exciting, new, fun, cool collabs coming out.

• 1:06:01Brian Preston?

  Last, last 28 days, I think 48% of our traffic was still unsubscribed.

• 1:06:05Speaker 02

  That's only half of you. That's only 50% of you.

• 1:06:07Brian Preston?

  But that doesn't mean glass half full is 51% are returning.

• 1:06:11Speaker 04

  The majority.

• 1:06:12Speaker 02

  That's true.

• 1:06:13Brian Preston?

  Guys, there is a better way to do money and you know, we try to every day pour into you the better ways to even look at this tool because it only, it does have limits to what it can and cannot do for you in your life. And we just try to help you become the best version of yourself, also own your time that much sooner because we really do want you to live your best life. I'm your host, Brian, joined by Mr. Bo, joined by Rebi and the rest of the content team in the wings here. Money Guy, out.

• 1:06:43Speaker 04

  The Money Guy Show is hosted by Brian Preston and Bo Hanson. 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. All investments involve a degree of risk, including the risk of loss.