Is Aggressive Saving Derailing Their Short Term Goals?

Joey (24) and Lia (24) are doing almost everything right: nearly $240,000 in net worth, close to $200,000 in household income, aggressive retirement investing, and a wedding on the horizon. But living in the San Francisco Bay Area brings a new challenge: should they keep investing, save for a home, fund a $30,000 wedding, or prepare for future kids? In this episode of Making a Millionaire, Brian and Bo help this young power couple navigate high-cost-of-living realities, Roth vs. Traditional 401(k) decisions, homeownership myths, financial planning for marriage, and balancing wealth building with life goals. If you're wondering how much to save in your 20s, whether renting beats buying, or how to prioritize competing financial goals, this episode is packed with actionable insights. 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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• 0:30Speaker 01

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• 1:00Brian Preston?

  That's one of the biggest things I have with achievers. You're running an internal checklist. You're like, you know what? Good student? Check. AP classes? Check. I've been rewarded for every one of these decisions, but I'm here to tell you, you're running up against the internal narrative is separated from the reality.

• 1:23Speaker 03

  Give us the background. Who are you guys? Right? So obviously you come from San Francisco. What, what got you from birth to San Francisco and now here today?

• 1:33Speaker 04

  I grew up on the central coast of California. Went to, I'm one of five sons, so I have four brothers.

• 1:40Speaker 03

  Let's go.

• 1:41Speaker 04

  And I kind of knew.

• 1:43Brian Preston?

  Where are you in the order?

• 1:45Speaker 04

  I'm number four.

• 1:45Brian Preston?

  Number four.

• 1:46Speaker 04

  Number four. So almost the last one younger brother.

• 1:48Brian Preston?

  Did they have a female name for you?

• 1:50Speaker 04

  You know, probably Josephina.

• 1:54Brian Preston?

  I'm just, I'm just curious because you know that every time they're like, okay, here's the daughter, here's the daughter. So this is going to be the girl's name just in case. And then.

• 2:01Speaker 04

  Well, that's what I said. I don't know if I'd exist if a daughter came before. And then after five, they're just like, okay, I guess this has not happened.

• 2:10Speaker 04

  But yeah, I grew up there, went to college locally.

• 2:14Speaker 03

  Okay.

• 2:15Speaker 04

  I kind of knew that I would have to cover most of college. So I was kind of researching when I was in high school. I knew the college I wanted to go to. I knew I wanted to go into business. And I was researching, you know, which AP credits are going to transfer to this college? Because I knew I was going to have to, you know, front that cost. Ended up going to Cal Poly San Luis Obispo, which is where Leah went. And I graduated with an accounting degree.

• 2:39Speaker 03

  How old are you now?

• 2:40Speaker 04

  Twenty-four.

• 2:41Speaker 03

  Twenty-four. What do you do? Are you, do you do accounting? Is that what you do now?

• 2:43Speaker 04

  Yes, so I got my CPA license a few years ago. Was working in tax while I, so graduated and got a job locally, a tax job, which I did enjoy. And then Leah actually ended up getting a job offer in the Bay Area. Started looking for different jobs. Wasn't sure if I wanted to stay in tax or kind of branch into something different. But I found a really cool opportunity and went into forensic accounting.

• 3:09Speaker 03

  Nice.

• 3:10Speaker 04

  So I am really loving that. I'm about two years into that. Forensic accounting can mean a bunch of different things. Most people think I'm in the FBI catching criminals and stuff like that.

• 3:21Speaker 03

  He's at the crime scene, right?

• 3:22Speaker 04

  Yeah. Have you seen the movie The Accountant?

• 3:24Speaker 03

  Uh huh. Ben Affleck, exactly what I was thinking about. That's exactly what I was thinking about.

• 3:29Speaker 04

  Not quite, but.

• 3:30Brian Preston?

  You presented that the most accountant way ever, too. I love that. That's so great.

• 3:35Speaker 03

  Leah, what about you? What's your backstory?

• 3:37Speaker 05

  Yeah, so I was born and raised in Sacramento, California. My dad always did science experiments with me growing up and we're always working on something. And that really sparked my curiosity and I had a great chemistry teacher in high school. And my college actually offered like a blended BS/MS program. I'm getting my ROI because I can still, I work a side job as a professor at a local community college. In addition to my day job as a research and development scientist for a consumer packaged goods company in the San Francisco Bay Area.

• 4:07Speaker 03

  So what does that mean? Like what?

• 4:11Speaker 03

  I understand all of those words individually. When you put them all together.

• 4:14Brian Preston?

  Because that's on a paper. Research and development science. I was like, that's.

• 4:19Speaker 03

  Job title.

• 4:20Speaker 04

  He's gonna start breaking out big words.

• 4:22Speaker 05

  No, no, no, no. Today, I'm a product development scientist. It's called like product slash process development. So we carry products in early phases through discovery work. And then we lead them all the way to activation and large scale manufacturing.

• 4:34Speaker 03

  So like new flavors of Doritos that like you like that's the kind of stuff.

• 4:37Speaker 04

  Work with a lot of fragrance science. Packaging or is it the flavoring and the actual product?

• 4:41Speaker 05

  All of the above. We have special scientists that focus on packaging development. And like oftentimes they they have like material science backgrounds or they study packaging specifically. So my role is more of like the product development. How do we slap a great claim on the package? How do we sell this? So it's very cross functional and like very consumer forward.

• 5:00Speaker 03

  You said you guys are engaged, not married yet, right?

• 5:04Speaker 04

  Correct.

• 5:04Speaker 03

  So you met in college, stayed together through graduation in the working world. And now you're preparing to get married. When when's the have you set a wedding date yet?

• 5:13Speaker 04

  Yeah, it's in July of 2027, so about a year out.

• 5:16Speaker 03

  Okay, so a year away. And how how long have you guys been out of school working?

• 5:22Speaker 04

  Three years.

• 5:22Speaker 03

  Three, okay.

• 5:24Speaker 05

  I've been working for two years full time.

• 5:25Speaker 03

  Two years, all right. So you guys are not fresh out of school, but you've been in the working world for a while. And what's wild is is you guys are sitting here thinking about, okay, what's the path? We're getting married. We're gonna talk about like joining finance, how this worked. You guys are kind of to share with us a net worth statement of kind of where you are today. And for you said, how how would you say you are?

• 5:44Speaker 04

  Twenty four.

• 5:45Speaker 03

  Twenty four and.

• 5:45Speaker 05

  I'm twenty five.

• 5:46Speaker 03

  Twenty five, so for twenty four and twenty five. Woo. You guys have a total net worth of $238,000 when you look at both of your individual net worths combined. And it's pretty wild of that $27,000 is in cash or like liquid assets. Investments represent about 208,000. There's a cabin that's in there that's a thing. And then we have only debt is we have some debt on said cabin. And then we have some student loan debts. You have about $37,000 of debt.

• 6:16Speaker 04

  It's not even a bad interest rate, though. Oh, it's super low because we were in college during COVID, so.

• 6:22Speaker 03

  So so when we look at this, twenty four and twenty five, $238,000 net.

• 6:29Speaker 03

  Almost $200,000 household income combined. Do you guys recognize how unique that is? Just the situation that y'all are in? Kind of where you're starting from?

• 6:39Speaker 04

  Yes, we are extremely grateful. We have great jobs.

• 6:44Speaker 04

  I think we set ourselves up very well with our majors and careers that we've gone into. We're obviously just in a very high cost of living area and we're trying to balance that. And also, housing is an expensive thing, you know? Wanting to break into owning a home one day, which seems a little out of reach. And it's hard to, it's hard to, you know, like prioritize that when you know the power of your dollars and what they can grow to at our age.

• 7:13Speaker 04

  So it's, it's hard to know like when to scale back that savings.

• 7:18Speaker 03

  Can you give some context like in the, because you said you guys live in the Bay Area? In San Francisco? Give us, for folks who don't know, like what's the housing market like there? Like when you're talking about we want to be homeowners, what does that mean? In sort of like real dollar terms?

• 7:30Speaker 04

  Well, we are not in the city of San Francisco. We're in a suburb, but it, a single family home is probably somewhere between 800,000, 1.2 million dollars.

• 7:43Speaker 03

  And how, like how, for context, how many square feet is that on average? I'm just trying to like, because you know, different parts of the country, different cost of living. I want to kind of level set that.

• 7:52Speaker 04

  That's probably a couple thousand square feet.

• 7:54Speaker 03

  Okay.

• 7:55Speaker 04

  Yeah.

• 7:55Speaker 05

  When we first moved to the San Francisco Bay Area, we were kind of unfamiliar of like what suburb we are, not city people. We just wanted to live like, you know, somewhere in a nice downtown area. There's parks, you know, maybe some gated parking just for that peace of mind. And the, the first one bedroom apartment we got was around like 770 square feet, which is considered to be on the, the larger side of a one bedroom, you know? We chose a place that's, you know, close to downtown. We live in like this town called Walnut Creek, beautiful place. But it comes with a pool and a barbecue and a gym. So it's like one of those all inclusive, like copy paste apartment complexes. And then we signed our first lease in 2024 at like 2660 base rent.

• 8:36Speaker 05

  But then that comes with like paying for an extra parking spot a month and utilities. So it's added like probably another $300 to our bill each month. And then over the past couple of years, we just got a notice of renewal for our lease because our lease is up at the end of July and they renewed us at like 2890. So we're like, we need to search for something else. You know, we have two cats. The cats need more space. We really wanted to break into a house.

• 9:07Speaker 03

  It's not us that need more space, Brian. It's the cats. It's who the cats were doing it for. Man, it's almost $3,000 a month for a rent, a one bedroom. But, but you said something so interesting, Joe. You said, man, I feel like it's hard to even prioritize saving for a home because the goal of homeownership seems so unattainable when you have to start at 800 to 1.2. Did I paraphrase that correctly? I think a lot of people, especially in this moment right now, a lot of like recent grads and young professionals feel that exact same way. Man, okay, there's no point in me even doing that. So why would I even try? So you guys are saying homeownership is a goal that you have, right? That's a goal that you want to work towards. What are you doing with like your current dollars?

• 9:52Speaker 03

  Like, like if you're not stocking it all the way to buy a home, where's your money currently going?

• 9:57Speaker 04

  We're investing a lot. I, so I'm trying to reach, you know, that 25%. I currently do 20% into my Roth 401k. I get a 5% match on that. And then I'm also maxing my Roth IRA each year. So it's about, I don't know, between 25, 30%, something like that. And then you invest a lot too.

• 10:21Speaker 05

  For my full-time, my scientist job, I put away 30% into my 401k. And then he, when I met him, I had $30 in my Roth IRA when I was 21 years old. And he, you know, put me onto the Money Guy Show and the power of the money multiplier. So here we are.

• 10:36Speaker 04

  Eighty-eight times $30.

• 10:40Brian Preston?

  You guys are crushing it in that aspect.

• 10:42Speaker 03

  It's wild. Okay. So 30% going in your 401k. Do you have an employer match through the?

• 10:46Speaker 05

  We do, yes. It's like a 4% and then invest with an additional contribution over a certain period of years.

• 10:53Brian Preston?

  Look, a lot of people are going to see El's situation and be like, you know, You're wicked smart. You went to college, fell in love, you got great jobs. Okay, we want a house. What other drama, what other struggles or goals do y'all have that we can address? Cause we can talk about the housing here in a second.

• 11:09Speaker 04

  I don't know about drama. We actually don't, we don't have much conflict over finances. We're not married yet. We haven't combined finances, but you know, there hasn't really been conflict there. And I think we're really aligned in our goals. I mean, housing's a big one. We want kids one day. And that's a hard thing, especially, you know, if we are to stay in the Bay Area. Knowing whether that can be done on one income, how to prepare for that. Hopefully our salaries, you know, go up over time.

• 11:35Speaker 05

  An additional question that I had, especially we're in this season of life where we're preparing to get married. Everything around the word marriage, bridal, anything.

• 11:44Speaker 04

  There's a tax that goes on top of it.

• 11:46Brian Preston?

  There's a whole industry helping you try to relieve you of your money.

• 11:50Speaker 05

  Luckily we have some help. You know, we're very grateful that his brother is a caterer.

• 11:56Speaker 04

  Yeah, my brother's a wedding caterer.

• 11:57Speaker 05

  Planner, so we're set up.

• 12:00Brian Preston?

  In the area?

• 12:00Speaker 03

  Just more relatives.

• 12:01Brian Preston?

  That's really helpful, cause you probably got some ins on locations and stuff too, hopefully.

• 12:05Speaker 04

  Yeah, so, I mean, venues are just expensive. Everything else that comes with a wedding is expensive. Photographer, DJ, everything.

• 12:13Brian Preston?

  But there was a question probably coming, so where was there?

• 12:16Speaker 05

  Is there a point of reference we can have when planning for something like that? Cause when I speak with people, they're like, okay, we were able to have a very like, a micro wedding at 20K. And then I hear people that spend like 80 to 100,000. And I don't think that's realistic for us. And we don't, of course, want to spend all of our savings on this event, but we want to.

• 12:36Brian Preston?

  Who's paying for the wedding? You guys paying for the wedding?

• 12:38Speaker 04

  Most of it, yeah.

• 12:39Speaker 05

  Yes. My, my parents are assisting with some of that.

• 12:42Brian Preston?

  But, but they don't, they don't have like a big pot of money waiting to spend on your wedding?

• 12:46Speaker 05

  We don't have 100,000 waiting, you know, for this wedding.

• 12:48Brian Preston?

  Yeah, that, that changes the algebra a lot, when, you know, when you guys are funding it. Cause you've, you've already given the head start knowledge that you know about the wealth multiplier.

• 12:57Speaker 03

  So, how much you plan on spending on the wedding? What conversations have you guys had on that?

• 13:01Speaker 04

  Our estimate, based on where things are currently going, we have like, you know, a few vendors locked in. It's probably gonna be around thirty ish thousand dollars.

• 13:10Speaker 03

  Hard stop at thirty or hey, we think that's what it's gonna be, but maybe it's more.

• 13:15Speaker 04

  It's so hard to know. I mean, we want to have, you know, a fairly large wedding, like a hundred fifty people.

• 13:20Speaker 03

  Oh, wow.

• 13:21Speaker 04

  It's just hard to gauge. I think our net worth, we're very investment heavy. We don't have, I think we've had some big expenses. So our cash balance is probably lower than what is even shown there right now.

• 13:31Speaker 03

  Well, you're doing the math for me. I'm like, all right, thirty thousand dollars for a wedding next July. So we're a year out from that. And we have twenty seven thousand dollars readily available in cash in total.

• 13:41Speaker 04

  So we gotta come up with that.

• 13:42Speaker 03

  There's a mismatch there.

• 13:43Speaker 05

  Right.

• 13:43Speaker 03

  The first question, right? You're estimating it's gonna be thirty. I really do want to know, is thirty a hard stop? Like, hey, we will not spend more than thirty or hey, we're gonna spend on this wedding and we're gonna do this and it's gonna be one fifty. And we're gonna have this, we're gonna have this, and we're just gonna cross our fingers and hope that it's under thirty. Because those are two different, those are two different things.

• 14:04Speaker 05

  Right now, it's looking like the cross our fingers. And of course, we have a spreadsheet because Joey's an accountant.

• 14:09Speaker 04

  I more keep track of it. I would say I'm not, like with our expenses, I don't like actually budget and keep track of every dollar. I just know what we bring in and an idea of what goes out. And there's money in the bank account at the end of the month. So I don't think I'm the best at, because we don't have that amount of money right now to spend. So that's a little nerve wracking.

• 14:32Speaker 03

  You have laid out for us that we begin with the end in mind. I chose this major and I did this. I looked at the AP class, like you guys are thinking. So I know this is not something you're thinking of the first time. What's your plan for how you're gonna come up with that thirty thousand? Between now and then, or over the course of the next year?

• 14:47Speaker 05

  I've been teaching on the side and that's been a great source of extra income in terms of like putting cash away. Because I'm like, you know, with my full time job, I'm putting thirty percent away in my 401k and after taxes and everything. It's kind of like I have my bare bones cash amount. And then everything I receive for my monthly like teaching paycheck just goes right into the high yield. So.

• 15:10Brian Preston?

  So is one of these a sinking fund for the wedding?

• 15:12Speaker 04

  It is not. No.

• 15:13Brian Preston?

  Okay.

• 15:14Speaker 04

  No.

• 15:14Brian Preston?

  Okay.

• 15:15Speaker 03

  So when we think about the side gig teacher income, how much is like a set amount? How much is that on average monthly that you have coming in net?

• 15:24Speaker 05

  Net would be around like 28.

• 15:27Speaker 03

  Okay.

• 15:28Speaker 05

  Yeah.

• 15:28Speaker 03

  And it's exclusively just getting parked in high yield savings? It's not getting spenders for anything else?

• 15:33Speaker 05

  I don't see much of that unless we have like emergency funds. You know, recently if we just got an opportunity to rent a home and there's some overlap in our rent. So it's like that secure deposit, you know, first month's rent. You know, we're really feeling the hit because this happened like, you know, a couple of days ago. So, um, yeah, it's just been a lot of cash right now.

• 15:54Speaker 03

  Awesome.

• 15:54Speaker 05

  But we're trying to use that pot of money for.

• 15:57Brian Preston?

  But you got a year.

• 15:58Speaker 05

  Right.

• 15:58Brian Preston?

  I mean, that's the thing. I don't want, you don't have to force it because you've got a year and you just, I gotta be honest with you, you just solved half the problem. I mean, right there with, now, can you do that consistently for six months?

• 16:09Speaker 04

  That's, okay, so she teaches, Leah works extremely hard. She has a full-time job and then she's also teaching this class on the side, which is a class plus a lab. And so this class goes until 10:00 PM at night.

• 16:23Speaker 05

  Wow, it's a five-minute general chemistry course.

• 16:25Speaker 04

  Yeah, so she teaches, full-time job, then goes straight to school, teaches until 10 o'clock. Uh, that's two days a week and then she has office hours the other days. Obviously there's more hours that go into all of that, um, you know, grading.

• 16:39Brian Preston?

  So this isn't a completely, this isn't sustainable for the next six months?

• 16:43Speaker 04

  That's, that's one of the things we wanted to bring up.

• 16:45Brian Preston?

  Give it, give it some reality then on $2,800 a month for three months? What do we get?

• 16:49Speaker 05

  No, it's actually, so I'm teaching both semesters this year. So spring semester and fall semester of 2026.

• 16:55Speaker 03

  So through the end of the year, we feel pretty comfortable in that 2026?

• 16:57Speaker 05

  Yeah, so I'm getting paid 10 months out of the year. Um, you're paid monthly and, um, you know, I'm receiving paychecks 10 months. So I think that is a substantial amount of cash to be saved.

• 17:09Speaker 04

  It's about like 15,000 per cent.

• 17:10Speaker 05

  Master that you teach. About, but I am taking a break next spring and you know, that was a

• 17:16Speaker 03

  We got a wedding to plan for.

• 17:18Speaker 05

  Maybe I should try to, you know, enjoy life, have more of a balance because it has been such a grind the past like year and a half so far. Um, and I, I love that job. Like, you know, it gives me the, the best of both worlds. I can work my industrial scientist job, but I can also, you know, like exercise my passion for teaching and getting to know students and you'll build your classroom community. So it's been a great learning experience, but also like, I'm tired at the end of the day and I'm grateful for Joey because you know, I'll come at 10. Yeah. He folds the laundry and cooks dinner. So, um, yeah.

• 17:51Speaker 03

  He is like the accountant, right? Remember the movie? That's it. He did all that stuff. That's it. Uh, okay. So, so six more months, right? That's going to get us somewhere 14, 16,000, depending on when the pay hits of cash, you may be able to bank up and you've already got $27,000, but we want to make sure we don't get too, too lean on cash. When we think about your monthly burn rate, do you guys have an idea of what your like baseline burn rate is?

• 18:15Speaker 04

  Okay. The slide is helpful. Yeah. We tried to put this together the best we could. Some of it is an estimate. It's around $6,000.

• 18:23Speaker 03

  Okay. Great.

• 18:24Brian Preston?

  I, I was going to ask you, cause y'all let something slip that y'all just potentially are renting a house now.

• 18:29Speaker 05

  Right.

• 18:29Brian Preston?

  So give, give us the scoop on that.

• 18:30Speaker 04

  Yeah. So this all just happened in the last week. Uh, so our previous landlord, uh, we're still living there in the meantime, but, uh, big corporate landlord, big apartment.

• 18:39Brian Preston?

  We heard copy and paste apartment complex. I'd never heard it said that way, but I was like, that makes a lot of sense.

• 18:45Speaker 04

  So that's, I mean, in the Bay area, because housing is so unobtainable for a lot of people, there are a lot of these huge apartment complexes everywhere because that's what a lot of people have to do. Yeah. You know, when we moved here, we chose that to start, uh, but they kept raising our rent every year pretty consistently. Uh, even this last increase, which I thought was pretty ridiculous. They raised it to, they post their current, um, rental prices online, uh, and the exact same unit that we could rent today, sign a lease, uh, they want $200 less than what they're trying to renew us for.

• 19:20Speaker 03

  You sign up different.

• 19:22Speaker 05

  Yeah, exactly.

• 19:22Speaker 03

  It's him and her now, it's her and him.

• 19:25Speaker 04

  So, we're like, you know what, it's, I think it's time to get out of here.

• 19:29Brian Preston?

  So tell us about this house. What's the deal in that?

• 19:31Speaker 04

  So we, we got a really good deal. It is twenty-nine-hundred a month. Uh, that's for a three-bedroom house.

• 19:38Brian Preston?

  Wow.

• 19:38Speaker 05

  Amazing. Yeah, we're so excited.

• 19:40Speaker 04

  Pretty close to where we currently are. That's almost the same rent that we were paying for this one-bedroom apartment.

• 19:45Brian Preston?

  What's the story of the people that are renting it? What's the landlord? What is, what's their goal with why they're renting this house? Is this like a rental house, or is this a house that they moved out of the area and they're just now renting?

• 19:55Speaker 04

  So he's, he's owned it for a long time. Tenant just moved out, uh, and he was looking for some long-term tenants and we, uh, this was a pretty competitive house to get. There were a lot of people interested, so we really jumped on it, uh, when we saw it come up and really grateful that we got it. So owning a house, a lot of that was just, you know, we kind of want to be in a house, in a single-family home.

• 20:15Brian Preston?

  Okay.

• 20:16Speaker 04

  And so now that we have that, uh, you know, I, I'm fine with staying here until we're able to eventually, you know, make that purchase.

• 20:25Brian Preston?

  So, and not, not to, cause man, I feel like, uh, the, the crazy uncle here asking y'all like, family questions before you even are married, cause you got a year before we get married or whatever, but y'all come from big families. So, you know, and you've already let it out, that, that, the cat out of the bag and the fact that you said we're going to have kids. When are y'all, what's y'all's timeline on that? Y'all are planners. I've, I bet y'all had this conversation.

• 20:46Speaker 04

  Yeah, we've talked about it. Around five to seven-ish years.

• 20:49Brian Preston?

  Okay.

• 20:49Speaker 04

  Uh, which is also kind of the home timeline. Five to seven years. How many kids y'all want?

• 20:55Speaker 05

  Well, I...

• 20:57Speaker 03

  They both looked at each other and said, "Yeah, what do we want?"

• 21:00Speaker 05

  He's one of five, so maybe he has a different perspective, but, um, I don't know. Mine's like two max, perhaps?

• 21:07Speaker 04

  Yeah, two to three.

• 21:08Speaker 05

  We'll see how we're doing, but I feel like our finances are a big part of like, do we feel ready? Do we feel comfortable? Can we afford childcare? You know, our families live far away, so it's not like we can have grandma babysit during the day, unfortunately.

• 21:22Speaker 04

  Yeah, and we both, I mean, we both bring in similar incomes, uh, so if one of us were to not work, that's obviously a big hit.

• 21:29Speaker 03

  Are y'all, career trajectory, is it the same? Like, uh, if you both continue working, do you both have the same career trajectory? Does one of you have a, a more rapid increase in income potential than the other?

• 21:39Speaker 04

  Um...

• 21:40Speaker 03

  Or a higher ceiling than the other?

• 21:42Speaker 04

  Fairly similar. I mean, uh, so my career goal is to one day become, um...

• 21:49Speaker 04

  To be able to provide expert testimony in like the the counties surrounding the Bay Area. Yeah. So and potentially become a partner at a firm. Right. But you know, that's going to take some time, require me to get more experience. But that's my goal one day. And if I get there, there would obviously be a considerable bump in pay.

• 22:09Brian Preston?

  How about, how about your opportunities?

• 22:10Speaker 05

  Yeah, I think it really depends on how the company is doing overall, but personally, I like where I'm at. My goal is to continue like trying to climb that corporate ladder, you know, use my opportunities while I can. And just try to build up a diverse set of skills because I know, you know, research and development sometimes could be limiting depending on the area. And I think that's why we're living in the Bay Area, just because it's like a technology hub. So it's a great place for us to start our career.

• 22:36Speaker 04

  Yeah, I think my career, I have more flexibility in where we would end up living. But Leah, you know, a job in, as a scientist or a chemist, those are more concentrated in urban areas. So not like quite as much flexibility.

• 22:53Brian Preston?

  Well, and I don't mind asking that question because we just before, I don't know how much makes it into the show. We were just talking about, y'all couldn't believe how incredibly green and beautiful Franklin, Tennessee is. I mean, are y'all set to staying in California? Because we already know it's a high cost of living area. I mean, since you guys are young, you're both highly educated, you're talented, you know, really, you can do anything. So that's why I feel like it's worth asking the question. Are y'all staying in that area for a long time or is that open ended?

• 23:22Speaker 05

  Well, I've tried to convince Joey.

• 23:25Speaker 04

  She's trying to plant the seed.

• 23:26Speaker 05

  Yes, actually, because I got the chance to live in North Carolina for like an extended co-op, which is like a long term internship. And it was with the company that I'm at right now, but it was like as I was finishing my master's degree, like at Cal Poly at the college, you take your classes and then the last sort of nine months of that program is either doing a thesis with like, you can choose to do research at the university and work with companies to fund your research or you can physically go do an internship for nine months and write your thesis based off of the technical work that you've been doing there. So I wanted work experience, so I thought this would be a great time to work and be in grad school, you know, like this is a great opportunity to do so. So moved to North Carolina. It was in the Raleigh Durham area.

• 24:09Speaker 05

  Beautiful. The grass is green. The trees are green. Not used to the hurricanes or the humidity. It reminded me of where I grew up because it's like two hours from the mountains, two hours from the beach. And I had a very bougie one bedroom apartment for $1,500.

• 24:27Speaker 05

  Living like a king. The fog gravity, doesn't it? I'm flexible, but I totally understand. Like, our families are in California. He has a cabin in California, so.

• 24:39Speaker 03

  Tell us about this cabin. This first time it's come up since that was.

• 24:42Brian Preston?

  Before, I want to hear about the cabin, but what are your thoughts on the moving? I want to make sure we close that loop and then talk about the cabin.

• 24:48Speaker 03

  He's gonna say I can't because of the cabin.

• 24:50Brian Preston?

  That would actually close it.

• 24:52Speaker 04

  No, I am open to it. Family is here. I do love California. It is very expensive. But as long as we can afford it, I would like to stay. At least for, I mean, we're both aligned on staying here for at least the short term near future, you know, five to 10 years. Just because we want to stay with our jobs for a while.

• 25:16Speaker 03

  You said one of the goals is to like, own a home, but then you said, well, I would love to be in a home. And then you said, well, maybe in five to 10 years, we might be open to not being here. Does that, is homeownership as big of a goal or not so much now that you're going to be in a three bedroom that's affordable and that, you know, you get the homeowners, the home experience without having the homeownership?

• 25:36Speaker 04

  I keep going back and forth on it because again, just when you look at the cost of renting versus buying a house and what you can do with that extra money and the power of those dollars, it's just really, really hard to justify it, especially at our age. And now that we're in the home, I'm like.

• 25:52Brian Preston?

  So why do you want to, why do you want to buy a house?

• 25:53Speaker 04

  I just like the idea of.

• 25:55Speaker 03

  It's built into the, this is what the American dream is. This is what successful people do, right?

• 26:01Speaker 05

  I can hang my pants on the wall, like, put nails in the wall without the landlord.

• 26:04Brian Preston?

  You don't have to ask the landlord. Did you watch our episode on is it better to rent or buy currently?

• 26:09Speaker 04

  I did. Yeah.

• 26:10Speaker 03

  What'd you think?

• 26:11Speaker 04

  It seemed like a pretty clear answer to me.

• 26:14Brian Preston?

  I mean, I did the math for you guys and I still want to hear about the cabin. But what's funny is I took a $1 million house. I only had you put down 3% because you know, on first time home buyer, we give you lots of grace. And so you only had to put down 3%, but then we financed the other 970 million, 700,000, $970,000. Public math, man, be careful. Anyway, the monthly payment, it's 6.5%, $6,100. And that's not property taxes, that's just, that's just the principal and interest. That's not even the property taxes, that's not the insurance.

• 26:52Speaker 04

  Not maintenance.

• 26:53Brian Preston?

  And I just heard you tell me that you've got a three bedroom house, not too far from where you are, for $2,900. Do you know why they can give you that house for $2,900?

• 27:02Speaker 04

  Because it's either paid off or he's got a really low.

• 27:04Brian Preston?

  Yeah, the interest rate on that house is, it's either exactly what you said, paid off, or there's probably a less than 4% mortgage rate on there. And so that you're getting the benefit of that. Plus, the purchase price was substantially lower before we had the 2021 run up in real estate, where it almost doubled, you know, in that three to five year period there. Financially, it doesn't make sense to buy a house, especially with all the life stuff that y'all just said. You just, you just answered your own question. And that's one of the biggest things I have with achievers is y'all think, you're on a check, you're running an internal checklist. You're like, you know what, I've been a good student, check. AP classes, check.

• 27:48Brian Preston?

  Hard major because I want to, you know, flex this, this muscle I have in my brain that's, you know, can do a lot, checking. Y'all have been rewarded for every one of these decisions, but I'm here to tell you, especially in this high cost of living here, you're running up against the internal narrative is separated from the reality of what you could do. Because that is twice as expensive. It's actually going to be more than that. It's going to probably be 125% more expensive than, than you just renting that house that you're in right now.

• 28:18Speaker 04

  Yeah, that's wild.

• 28:19Brian Preston?

  You run that by the wealth multiplier? I'm talking about this is at Joel's age, changes your life in the future. It really does.

• 28:28Speaker 04

  I agree. I still want that to be a long-term goal for us. And it's just so hard with the current market. I know we're probably not expecting prices to increase at the rates that they have in the past five years. It's just hard to know when to jump in. And especially if we aren't completely set on staying in the Bay Area.

• 28:47Brian Preston?

  Exactly.

• 28:48Speaker 04

  You know, if I buy in at the wrong time.

• 28:49Speaker 03

  That's the biggest red flag, in our opinion.

• 28:52Speaker 04

  And then we decide to move.

• 28:54Speaker 00

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• 29:23Speaker 04

  Well, you know, if prices went down, you know, you're kind of stuck.

• 29:27Brian Preston?

  Yeah, that's the problem with lever debt is because you lose 10% in the market of the value of the house. You know, because you have to sell it, you have to move to relocate. You fill all of that.

• 29:37Speaker 04

  Hundreds of thousands of dollars.

• 29:38Speaker 03

  And, you know, people often pose it as, oh, well, renting is just throwing money away, throwing money away. I, you just laid out the perfect case. Well, it's not throwing money away. It's buying yourself options and flexibility. I'm only committed for 12 months or 24 months, whatever your lease term is. And then I can choose to do something else if I want to. I can choose. Once you buy that house, you are sort of at the mercy of what happens with the housing market. What happens with that particular home? And if that stuff isn't set, I would be careful rushing into it, especially in a super high cost of living area like the Bay Area. So even if you were going to do that, you got to save up for down payment. He said 3%, so it's $30,000. We already have this wedding that we're trying to save up for as well that's 30. So now we're like having these multiple goals we're stacking up.

• 30:18Speaker 03

  You guys said that your monthly burn rate is about $6,000, right? Even with this new house, there's somewhere in that ballpark. You also said that your income. are roughly equal. So it's not like there's a wide disparity. So I would argue that in that sort of environment, a three-month emergency fund is probably prudent. It's probably not like a crazy thing to think about. So you take $6,000 times three months, it's $18,000.

• 30:42Brian Preston?

  Just go ahead and have a $20,000.

• 30:44Speaker 03

  So 20,000. So when I see your current emergency fund, the cash that you have on hand, according to your net worth statement right now, I can see that it is $27,000, right? So we're about seven. Alright, so in my mind, I'm thinking if I'm trying to fund goals, alright, I got $7,000.

• 31:00Speaker 04

  Move that to another bucket.

• 31:02Speaker 03

  For the wedding, right? Like I got $7,000 for the wedding. We've already laid out that if you just can continue this pace of teaching for the remainder of the year, that's gonna be another 14, 15,000. Alright, well, now we're at like 21, 22,000 of this $30,000 goal. How are we gonna bridge the last 7,000 to 8,000?

• 31:22Speaker 04

  So that was one of my questions on whether we can scale back on the savings, at least temporarily. One of my thoughts also was to, I think we're kind of on that borderline Roth versus traditional contribution, uh, cause California tax rates are quite high. We're looking at around 30, 31% marginal rates. So we're, we're kinda on that borderline. Uh, we've been contributing to Roth, uh, in the past. But if we switched to traditional, if we could, you know, free up some cash flow that way.

• 31:55Speaker 03

  Big time.

• 31:56Speaker 04

  Or just dialing back the percentage that we contribute.

• 31:59Brian Preston?

  And you're still gonna be putting money into the Roth IRA too. I mean, you could, even if we, I mean, cause y'all's structure, even if you started blowing through the income thresholds, you could start doing, structure it as a backdoor Roth contribution.

• 32:11Speaker 03

  But there's a good chance you won't have to do that. Your income, you're not gonna necessarily be there, but you are at the income where pre, uh, you just said 31. So you said you're putting in 20%, you're putting in 30%, right? So how much total do you have going into your 401k annually? I'm asking, I'm sure you probably.

• 32:26Speaker 04

  Uh, it's about 20,000.

• 32:28Speaker 03

  Alright, so 20,000. Between the two of you or just yours?

• 32:30Speaker 04

  Just mine.

• 32:31Speaker 03

  Just yours. 20,000 for you and the 30% of your pay.

• 32:33Speaker 05

  Barely missed the mark on maxing out.

• 32:35Speaker 03

  She almost maxed it. So it's like 40. To forty five thousand dollars a year going in. Do you recognize if all you did was switch your contributions from Roth to pre-tax? If that thirty one percent tax bracket, that alone would save you twelve thousand dollars in taxes.

• 32:51Speaker 04

  Wow.

• 32:52Speaker 03

  Just doing that. That's an extra thousand dollars a month in savings that you guys could have to still fund Roth IRAs because you're below the Roth limit, or if income increases, you could do the backdoor, or to fund some of these other goals that you guys have. It's why, and, and, and we love Roth, and you guys are young, and Roth makes tons of sense. But you are the case study why, if I told you, hey, by clicking one button, you could potentially have an additional twelve thousand dollars every year, that's pretty substantial. That's pretty significant, right?

• 33:20Speaker 04

  Yeah, and I think that could just be, you know, a temporary thing. We don't even necessarily, uh, with the numbers he brought up. I mean, we don't even necessarily need to dial back the percentage, and we can still get to that thirty thousand-ish goal.

• 33:32Speaker 03

  That's right.

• 33:32Speaker 04

  For the wedding.

• 33:33Speaker 03

  So, the wedding is a goal, and the homeowner, I don't even know if homeowners is that a thing?

• 33:40Brian Preston?

  I think it should be put on the shelf for a while.

• 33:41Speaker 05

  I think so too.

• 33:42Speaker 03

  Um, alright, so it's come up a few times, but I want to address, because when we're looking at your net worth statement, there was this cabin, this thing that showed up. You don't own a home.

• 33:51Brian Preston?

  You don't see a lot of twenty four year olds with a cabin. I know.

• 33:54Speaker 03

  Walk us through, what is this thing? Where'd it come from?

• 33:57Speaker 04

  Okay, so kind of a unique situation. Uh, there's this cabin that's been in my family for about a hundred years, really old cabin.

• 34:06Brian Preston?

  So this has got a family legacy to it.

• 34:08Speaker 04

  Not this cabin, but.

• 34:11Speaker 04

  Not this one.

• 34:12Brian Preston?

  Tell me that's how you thought he was about to go.

• 34:15Speaker 03

  Oh, it's the whole family, like, we can't let this cabin go.

• 34:18Speaker 04

  So, what happened was, uh, yeah, that family's been in our, uh, that cabin's been in our family for a long time. Uh, great, great grandpa bought it, very rustic. It's, uh, in California, near Sequoia and Kings Canyon National Parks. That was a big part of my childhood, going there every summer, going there Memorial Day weekends. Recently, uh, it's part of this group of cabins. There's like thirteen of them.

• 34:39Brian Preston?

  Is this near the cabin that your childhood memories are?

• 34:42Speaker 04

  So it's in this like community of cabins where they rarely, if ever, come up for sale because they've been. Families for, you know, a long, long time.

• 34:49Brian Preston?

  Okay.

• 34:50Speaker 04

  And opportunity came up, uh, three, four years ago. Someone was selling and they wanted to keep it within, you know, the group.

• 34:58Brian Preston?

  Okay.

• 34:59Speaker 04

  To offer it to somebody first. I got approached to ask if I was interested in purchasing it. Uh, and you know, I had like just started my first big job out of college. Didn't have a ton of money saved up. But then I asked my brother, hey, do you want to go in on it with me? Because you know, this might not come up in the future. And he decided to go in on it with me. We bought it for $80,000. It's again, very rustic. It's more of a glorified wooden tent at the moment. Built like a hundred years ago. There's technically electricity, uh, no running water. So there's a lot of work that needs to be done. So we bought it, uh, put down $20,000.

• 35:41Speaker 04

  We're financing the rest seller financing at, I think, 5% interest rate. So we're paying, uh, about $650 a month total on it combined. We're spreading that over 10 years. And we're, I think like a year and a half into the payments.

• 35:58Brian Preston?

  Does that pay it off or is that balloon it? Does it balloon in 10 years?

• 36:01Speaker 04

  No, no, that is even, uh, yeah, evenly amortized over the 10 years.

• 36:05Brian Preston?

  Okay.

• 36:05Speaker 04

  So yeah, if we pay the 600, 650 bucks a month for the next eight and a half years, it'll be paid off.

• 36:11Speaker 03

  Okay. So the idea is one day this will be a place where your kids spend time and that's.

• 36:15Speaker 04

  Exactly. Yeah. And I didn't want to miss out on this opportunity that I just didn't think was going to come up again. Even though it, it felt like a very, uh, premature move. When I made it, especially when I made it, because my accounts, uh, my Ross and everything were not funded to where they are today.

• 36:32Speaker 03

  Yeah.

• 36:33Speaker 04

  At that point.

• 36:33Brian Preston?

  So it didn't hurt you, it doesn't sound like.

• 36:35Speaker 04

  I don't.

• 36:36Brian Preston?

  You've, you've obviously maxing out your rock.

• 36:38Speaker 03

  It was risky, but it didn't bite you when you did.

• 36:39Speaker 04

  Exactly. I think there's still enough margin to, you know, make those payments. I'm only paying for half of it. And then there's, uh, my brother and I are aligned on, you know, there's a ton of things we could do to the cabin. And right now it's more, more of a campsite and you know, it's still usable in its current state. And it's more of a long-term thing. We'll get to those.

• 36:59Brian Preston?

  I have a few quick questions.

• 37:00Speaker 04

  Yes.

• 37:01Brian Preston?

  Any chance you're inheriting the family cabin that's down the street?

• 37:04Speaker 03

  The one that's been in the family for a hundred years?

• 37:06Brian Preston?

  Yeah. The one I thought you were telling us about originally?

• 37:08Speaker 04

  The issue is it's, because my great-great-grandfather bought it, so now it's split between a bunch of relatives.

• 37:15Brian Preston?

  So there's a good chance you won't have access to go buy it and use it as much as you wanted to.

• 37:20Speaker 04

  To use it, but not exclusively.

• 37:21Brian Preston?

  That's a solid answer.

• 37:23Speaker 04

  Yeah.

• 37:23Brian Preston?

  The next question is, what does your soon-to-be-wife think of this?

• 37:27Speaker 05

  You know, I think Joey made this purchase when we were like, kind of freshly dating and he was like 21, 22. And I was like, really? You're gonna buy a cabin right now? But being able to go up there with the family and, you know, experience a cabin.

• 37:42Brian Preston?

  Have you been to the cabin location?

• 37:44Speaker 05

  Yeah.

• 37:44Speaker 04

  We were just there a few weeks ago.

• 37:45Speaker 05

  Yes, I will say the only bad thing is the mosquitoes, but it's a gorgeous place.

• 37:50Speaker 03

  Also, the no-running water sounds like a bad thing, too. You said the mosquitoes are the only bad thing, but no-running water sounds not great either.

• 37:57Speaker 05

  Well, there's a creek that runs right by it, so, you know.

• 38:00Speaker 03

  There is literally running water by it.

• 38:03Speaker 04

  Definitely marry this girl.

• 38:04Speaker 03

  Yeah, go ahead and lock it down.

• 38:05Brian Preston?

  Just go ahead and lock this down. If running water is not the issue, then this is...

• 38:09Speaker 05

  I saw how important this was to him and his family, and it made more sense over time, once I could actually see it for myself. But like, totally like, months into dating and him buying a cabin, I'm like, whoa, I gotta think about... No, I'm just kidding.

• 38:22Brian Preston?

  And do you, from a blossoming memory standpoint, does this seem like something that'll be fun for you to do with y'all's future kids as well?

• 38:28Speaker 05

  Absolutely, like, I had so many wonderful memories going to like, Lake Tahoe with my parents growing up. And, you know, having the privilege of like, a secondary space to enjoy summer is like, awesome, so I'm here for it. It's gonna, I'm, I don't think we have the cash to invest in those renovations immediately, but I'm glad that we're all on the same page, that's gonna take some time and...

• 38:52Speaker 04

  Yeah, we're not in any expectation of that.

• 38:54Brian Preston?

  That's the next question is, what's your brother's timeline on renovating and building this cabin up?

• 39:00Speaker 04

  Uh, similar. We're both not in a rush.

• 39:02Brian Preston?

  Okay, so you're not in a rush. Y'all are on the same page. Do you foresee a problem? Cause there will. Fast forward 10 years. You're, you're just rocking and rolling. I mean, based upon your net worth statement. You know, you know what? We got a few kids now. I want to start making those awesome memories. Is there going to be any drama with you and your brother or the, when you want to start throwing money at it? Or is he going to not be, is it going to be weird? Cause is he going to be able to financially do it when you want to do it?

• 39:27Speaker 04

  Yeah. I mean, I, I hope not because we.

• 39:30Brian Preston?

  Are you hoping he will or hope not?

• 39:32Speaker 03

  I don't want to see any dramas.

• 39:33Speaker 04

  There won't be any drama. Yeah. I mean, there hasn't been thus far. And I was a little weary about, you know, going into anything 50 50 with somebody, you know, that you're not like married to. And so we're, that's something we'll have to approach.

• 39:47Brian Preston?

  I, I asked, that's the biggest advice I could give you is go ahead while it's on the scale of life concerns. This is like at the bottom, as long as you just have the carry costs. Go ahead and have a conversation with your brother and be like, hey, when do you think? I just want to kind of, we're just trying to figure out what the next 10 years looks like. I, I want to make sure we don't have some weirdness down the road. Y'all figure out the push-pull system that's going to create the, the action element on this. There's nothing wrong with just, cause land is, it's one of those great locks, lock-ins of value. And then, you know, this is, sounds like it's going to have a scarcity of access to it in the, anyway. So I see nothing wrong with it as long as you've had good communication with what the expectations are. Cause you don't want to get into a weird dynamic where you want to renovate this cabin,

• 40:31Brian Preston?

  but you, your brother doesn't and, or the, or.

• 40:34Speaker 04

  Exactly. Or one of us, you know, has the money.

• 40:36Brian Preston?

  So go ahead and have those conversations while it's really low on the priority scale.

• 40:40Speaker 03

  I am curious though, uh, cause you said right now you guys are separate finances. Like you are, you are separate.

• 40:45Brian Preston?

  Yeah. I want to hear about that.

• 40:46Speaker 03

  What's going to happen? You know, fast forward to July. What happens? How does that work? What's that look like? And, and even I think it'd be valuable for some couples out there who are perhaps dating right now or engaged. How do you guys navigate finances now and what will change when you get married?

• 41:02Speaker 05

  I want to start off by saying like, first of all, Joey really impressed me because his nature, he's a financial mutant by nature for sure. But I feel like he's always been very generous when we first started, not when we only first started dating. But I feel like the way you handle money and the way you, you know, of course, treat me and we enjoy our money. But I also respect the fact that you prioritize saving and you encouraged me to do the same in a respectful way. And just like learning that about you has made me feel like very much comfortable with the idea of combining finances during marriage.

• 41:41Speaker 05

  Especially if it's like, I don't want to feel any sort of anxiety if I, not that I have, like, I don't feel like we don't spend a lot on material.

• 41:49Speaker 04

  Yeah, I mean, I think we're both aware of what we spend money on and we don't really spend on extravagant things.

• 41:56Speaker 05

  Right.

• 41:56Speaker 04

  And haven't really had much conflict over money. There's a lot of Venmos happening, you know, and all that stuff, just because we're married.

• 42:03Speaker 03

  Is that what you do? You square up via Venmo?

• 42:05Speaker 04

  Yeah, yeah, I mean, just with rent and utility, like the big stuff, you know, and then the other stuff.

• 42:10Speaker 03

  Y'all split everything fifty fifty? Is that the way it works?

• 42:13Speaker 04

  Uh, for the big stuff and then, you know, smaller things, it's just, we pick things up here and there.

• 42:18Speaker 05

  But it's never, I don't want to feel anxiety if we go like, if I go buy a shirt, for example, it's like, oh, I see forty dollars on the account, you know, like. I feel like that's not going to be a concern going into it.

• 42:28Speaker 03

  So do you, do either one of you, like, use some sort of, like, budget tracking? Like, are you using Monarch or something like that to see the transactions?

• 42:36Speaker 04

  No.

• 42:37Speaker 05

  No.

• 42:37Speaker 03

  When you combine, will you, like, like, will you see all the transactions that she has and you see all the transactions that he have, like, when that happens?

• 42:45Speaker 04

  Yeah, I mean, I imagine we'll have a joint checking account and then, you know, separate credit cards that you can spend what you need to spend.

• 42:54Speaker 03

  Okay.

• 42:54Speaker 04

  But.

• 42:55Brian Preston?

  How are you gonna pay for those credit cards?

• 42:57Speaker 04

  From the joint account.

• 42:58Speaker 03

  Okay.

• 42:58Speaker 05

  Yeah.

• 42:59Speaker 04

  I think, I mean, as long as.

• 43:01Speaker 03

  But you just said spend what you want to spend, so like, what if, like, what if this month is like, I spent like a thousand on mine, but you spent like two thousand on yours, and we gotta.

• 43:08Speaker 05

  Most of the time, it's like eating out together. I feel like that's our crutch, is just food right now. But I feel like I trust you with your money. Hopefully you can say the same about me, but not too concerned about the transactions.

• 43:22Speaker 04

  I'm not too concerned, but I mean, it's obviously hard to say until you get there.

• 43:25Speaker 05

  Right, I guess. Who went to Costco for five hundred bucks last week, you know?

• 43:29Speaker 03

  Who did go to Costco for five hundred?

• 43:33Speaker 05

  I know. You went without me?

• 43:35Brian Preston?

  That's traumatic.

• 43:36Speaker 03

  It's right here.

• 43:37Brian Preston?

  It's easy to do. He probably bought, he probably, because every time I go to Costco, I feel like I come home with some pillows, some mixed nuts.

• 43:43Speaker 05

  Yes.

• 43:43Brian Preston?

  And then I end up with like a case of like some flavored drink that I didn't know I needed.

• 43:48Speaker 03

  Let me ask you this. So we were asking you questions about like combined. Are there questions that we could answer as, as two guys who've kind of gone through that threshold? Anything that you are curious about that we could speak to that might be valuable as you guys have your conversations moving forward?

• 44:01Speaker 05

  I guess going into marriage, do you have any advice in terms of approaching finances? Cause I feel like we have a pretty stable, you know, relationship with money, similar values going into this, but of course like life ebbs and flows. There's going to be big expenses here and there. Of course, like there's going to be a purchase made where we're like, what the heck? Why did you do that? So would you recommend, you know, what if we have a personal savings that, you know, we can make our fun purchase on? Or how could we mitigate or prevent future conflict with money, like going into marriage?

• 44:34Speaker 03

  I'd like to speak to the what the heck question. Um, because my wife and I never really had conflict over finances. Uh, however, we had a very different understanding of what was justifiable expenses, well, we're not justifiable expenses. And where I struggled early on, and sweetheart, I love you. This was on me, is I did not assign enough value to the things that she valued because I didn't value those things. So when she'd spend X number of dollars on X thing, in my mind, it was wasteful. And I'd see the transaction come through and I'd, you know, we'd have our miscellaneous bucket or a home furnishings bucket and I'd categorize it in the app and I'd be like, hey, hey, you're blowing through it. And she's like, yeah, I'm blowing through it because I care about the shampoo that I use. I'm not going to use Swab. I care about.

• 45:19Brian Preston?

  Not Kirkland?

• 45:20Speaker 03

  The throat, right? Right? And so I think having an understanding around, uh, cause what it felt like early on in my marriage is that I began micromanaging, hey, why are you doing this? Why'd you do this at Target? Why'd you buy this? Hey, why'd you go buy this thing at Whole Foods when we could have gone to Walmart to get there or whatever the thing is? Uh, and we had to have like a very sincere conversation on, hey, just cause you don't think this is important, just cause you don't think this is valuable. Doesn't mean that it's not. It means that that's your opinion and if I feel differently, we need to figure out how to reconcile that. The earlier you can have those conversations, in my opinion, the more valuable. Cause what happens is, at least in my case, new marriage, in love, all the wonderful stuff. You don't want to say anything. So you just let these thoughts just fester and they get, and you start making these like passive aggressive comments and you start.

• 46:04Speaker 03

  And it just turns into this nasty thing that if you can communicate on the early end, I think you can avoid a ton of that.

• 46:10Brian Preston?

  Let me give you all some homework. Bo got married on June 9th of 2012. And we've been creating content for 20 years now, if you can believe it. And we, it's all out there. So we're crazy. So you can hear this thing from the amateur beginning all the way through where we are now. And right around that June of 2012 period, I did a show with Bo. Where we interviewed him on what he thought was going to happen with his upcoming wedding. So this was either in May. Um, and it's just probably going to be entertaining for anybody. Maybe we could even help everybody out by giving, giving.

• 46:43Speaker 03

  Oh my goodness, what if we did?

• 46:44Brian Preston?

  No, we did. We did a one year episode.

• 46:46Speaker 03

  Oh, you did a one year update.

• 46:47Brian Preston?

  Oh, we did a one year. We did a one year update. Go listen to the one before his marriage and I want you to listen to the one year later episode. And you're gonna hear a lot of growing up that went into it. Now, Bo's been married over a decade now. So he's, he's a veteran.

• 47:01Speaker 03

  14 next to us.

• 47:02Brian Preston?

  You're hearing us at, at veteran level status here on this, but I think it would be good for anybody who's struggling because I remember Bo. Um, and I was trying to sit here, was it $40 or?

• 47:11Speaker 03

  $40.

• 47:12Brian Preston?

  Forty, Bo said any transaction that she spent over $40. And I can remember, that's why.

• 47:17Speaker 03

  That was gonna be our check in.

• 47:17Brian Preston?

  That's why he brought it up is because I was like, Bo, her shampoo costs more than $40. And, and he was, he was like, no, it's not.

• 47:24Speaker 03

  $40 will buy me 30 years worth of shampoo.

• 47:26Brian Preston?

  You can tell I, this was still, this had a, not a scab on it. It's probably got a scar on it at this point. Cause we're old enough that it's, but. But that's why he brought up the whole suave thing is because I told him on that show that her shampoo is going to cost $40. And he was like, no, she can go suave just like I do or whatever else. So I think if you go listen to that, there is a growing element. That, because what you, any couple has to do is, and y'all have already done a great job. Y'all have already probably graduated beyond a budgeting. I mean, y'all don't even have to really, you just answered it. Y'all aren't using Monarch or anything like that because your money is going where it's supposed to through automated savings. So you don't feel any pressure about doing budgets.

• 48:03Speaker 04

  Exactly. And I think that's one of the reasons like why this hasn't been an issue yet. Because I mean, we have, currently, we have the margin.

• 48:11Brian Preston?

  Y'all been blessed that y'all make enough money.

• 48:13Speaker 04

  Exactly.

• 48:13Brian Preston?

  The money just goes where it needs to.

• 48:15Speaker 04

  Yeah.

• 48:16Brian Preston?

  There might be a future to where y'all have to do when you're doing the family planning where y'all say, you know what? We're going to take a few years where maybe we live off one income and we got to figure out how that's going to go. I encourage you, when that happens, do a budget, you know, do something where you're actually tracking. You're already kind of, you know, doing it, but there's tools that make it easier. But then, once you get to that point, what I'm trying to help you do, take the power out of the money. Is because so many people, it's a struggle when, you know, you put value to what people are spending. And then my money is my money, her money is her money. And it creates these weird dynamics to where you don't want to get a situation where when y'all decide one of you is going to stay home with the, the child for, for a while or children.

• 49:00Brian Preston?

  And then, you know, just for a moment in time, you don't want the other person feeling like they're in this situation where you have to go ask the other spouse for the money. Because then, holy cow, what a weird, what a weird dynamic that is. So that's why I love that you're already planning, when you cross those thresholds to become one. Open the joint checking account, go ahead and redo your direct deposit forms for your employer where they're, they're going right into that joint checking account. So that way, it just seems like we are, two became one, our, our household expenses are one. You know, the good news is the government's already protecting, you know, your Roth IRAs, those aren't joint Roth IRAs.

• 49:37Brian Preston?

  They're not joint Roth 401Ks. I mean, they're, they are individually tied to your, you know, there's already some protections on some of that stuff on what you have brought into the marriage. But I love everybody kind of setting up a joint checking account, setting up maybe a joint brokerage investment account at one of the low cost providers. And then y'all build this thing together. So it's you two in, in you versus the world.

• 50:00Speaker 04

  I'm excited about the plan we're going to put together because I'm thinking we're going to be able to build a plan to get you from today.

• 50:04Speaker 03

  Day to the wedding and then we're gonna show you what happens. Okay, post wedding. What does life look like at a reasonable savings rate for you guys? I do have one clarifying question. You got 20% going in your 401k. You said you're maxing your Roth IRA. You said you got 30% going to your 401k. Are you also maxing your Roth IRA? Correct. Perfect. Of course.

• 50:23Speaker 04

  One of the reasons, just to clarify, the 30%, you were contributing 2025.

• 50:28Speaker 03

  Yeah.

• 50:28Speaker 04

  Uh, but since her teacher paychecks aren't having any investments withheld, that's why we increased it.

• 50:35Speaker 03

  You increased her to get her to 25%.

• 50:37Speaker 04

  Yeah.

• 50:37Speaker 03

  Gross. Got it. Makes sense. I'm excited to be able to put this together and I, I don't want to give away what's gonna happen, but it's gonna be, it's gonna be an awesome picture because you guys have done a lot of really great stuff early on and I don't see, I don't see you guys stopping to do that. Brian, what a great conversation with Joey and Leah.

• 50:56Brian Preston?

  I mean, think about this. What do you get when you get a scientist and an accountant walk into a bar?

• 51:03Speaker 03

  I don't know, Brian. What do you get?

• 51:05Brian Preston?

  You get a very successful young couple named Joey and Leah. I mean, this is a great time. They got a lot of great stuff going on and I gotta tell you, I'm shocked that the problem we're gonna save for them is they over save.

• 51:18Speaker 03

  Yeah, it's not something we often do here, right? Like, we don't often talk to people that are over saving, but they have a lot of big goals coming up. Obviously, they have a wedding coming up in July. Home ownership, they're trying to figure out, is that the right move? Is it not the right move? But there's this pressure, I feel like they're putting on themselves that they are saving so much. Perhaps it's crowding out some of these other goals that they could be pursuing and could be putting resources to.

• 51:44Brian Preston?

  They are. They literally are the perfect example of why personal finance is personal.

• 51:49Speaker 03

  That's right.

• 51:49Brian Preston?

  Is because you just said it, with the wedding coming up, they want to know, is homeownership something they ought to consider? Well, how can they have these goals when they're gonna be so retirement rich, but not have enough margin or leftover to even fund some of these other important things that are coming up?

• 52:05Speaker 03

  Yeah, so when we look at their current savings, it's pretty wild. Right now, Joey's putting 20% in his 401k and getting a 5% match. Leah's putting 30% into her 401k. 401k getting a 4% match and they're both maxing out the Roth IRA. So with an annual savings of almost $67,000 a year, it puts them at a 34% savings rate, which for two young folks at their age, is a super heavy, big time savings rate that I don't think is absolutely necessary.

• 52:35Brian Preston?

  Well, and they also know they have a time certain wedding coming. And when you look at the funding of that, you're like, wait a minute. How are we so wealthy but cash poor?

• 52:45Speaker 03

  Yeah, and, and I think what's happened is they know that saving is a good thing. They know that Roth is a good thing. And so they're doing all these noble, good things. But perhaps, and, and I say this lightly, maybe there is a little too much of a good thing going on for them. Cause when we thought about, all right, if we were going to triage, if we were going to adjust this, what would we think about? We'd say, okay, well, what if we reverse engineered to figure out what would it take for them to be able to hit a 25% savings rate as opposed to 34? Well, for them, what that would look like, again, if they're going to follow the financial order of operations, max out Roth IRA 7,500, max out Roth IRA 7,500. And then we said, hey, let's back down both of their 401k contributions. Let's take Joey's down to 14% and let's take Leah's down to 15%.

• 53:29Brian Preston?

  And instead of just not only backing it down, we flipped the script and actually turned it into traditional. They're in a high tax situation, even though they're young, I get it. And there's a lot of pressure when you're young, do Roth. And we love it too, because you get more time for compounding growth. But at the tax rates that they're currently paying, this could actually save them over $2,000 a month.

• 53:50Speaker 03

  Yeah, that's right. Backing down those contributions plus the tax savings is going to end up with almost an additional $25,000 a year. $2,000 a month they're going to be able to save. And what's great is the math works out wonderfully. We know that right now, they know that their cash is right about $7,000 into this wedding fund. And we asked them, okay, how much do you think you're going to have to spend on the wedding? And they said, I don't know, maybe something like $30,000, somewhere in that ballpark. Well, if you just take the timeline from now until next May, June, July, and they have an extra $2,100 a month, if they just took that $2,100 And parked it in a high yield savings account between now and then they would get that wedding fund fully furnished up to $30,000.

• 54:32Brian Preston?

  Is the term serendipity?

• 54:34Speaker 03

  Yeah, that's a term.

• 54:35Brian Preston?

  Isn't it kind of amazing that the two is right around $2,100 a month savings they're going to have if they change this from a tax standpoint, you multiply it by the months they have until the wedding.

• 54:46Speaker 03

  It gets them right on target.

• 54:48Brian Preston?

  Thousand dollars or so. That's pretty magical. I almost think it's like a big wedding gift.

• 54:53Speaker 03

  But I know the question they're going to be asked is, okay, guys, well, if we do back this down, if we're not saving at this same clip, what does that ultimately mean long term? Are we actually going to be able to reach our financial goals? And what's amazing is they've done so much heavy lifting and hard work thus far at such a young age. At 25 years old with over a $200,000 portfolio, if they were to just save the 25%, not the 34% they're currently saving, they're on path, on track that by the time they get to 55, they could have almost a $12 million portfolio. By the time they get to 60, almost for retirement age, almost $20 million. So they've done the hard work and heavy lifting where they don't have to be in this hyper save,

• 55:37Speaker 03

  hyper accumulation mode unless they have some crazy financial goal they haven't told us about, like super, super early retirement, big time fire. And what they've been able to do by building up the pot of money they've done is now they're going to give themselves options and flexibility as they move forward in their life.

• 55:53Brian Preston?

  Yeah, I think they're definitely on a healthy path, path for a great retirement. The thing that I did want to circle back on this house.

• 56:02Speaker 03

  Sure.

• 56:03Brian Preston?

  I could tell that we hit on something and I felt a little guilty because it's usually considered such a noble cause to save for a house. But when they shared what they can rent this three bedroom house for in the Bay area versus if they had to buy.

• 56:18Speaker 03

  It just didn't make sense.

• 56:19Brian Preston?

  Oh, my gosh. I mean, if we're talking about maximizing the opportunity of wealth building, there's a little bit of disconnect. So I would, I would encourage them, look, we like homeownership, but in their specific situation, once again, personal finance is very personal. Don't get in any hurry to fund. Paying for that house.

• 56:35Speaker 03

  Well, and again, they're just getting married. And so homeownership may be something that they want to pursue at some point in the future. But I think that right now, they have enough slack, they have enough margin in the system, even when they get that wedding fund fully built out and they get married, if they still stick to 25% savings, they're going to have excess liquidity. They can move towards one of these other goals, like saving for a house, or like doing the family thing, or like whatever that thing for them may be. I don't think they have to worry about getting all of it as much as possible into their retirement accounts. I think they're going to appreciate the liquidity.

• 57:09Brian Preston?

  Joey, Leah, hopefully you feel like we just released the pressure valve on you because y'all got some big life stuff going on. We want you to enjoy that. Go save for that wedding, make beautiful memories for that. You're going to be A-OK. Beau, for those who want to come on Making a Millionaire, how do they apply?

• 57:27Speaker 03

  Yeah, if you'd like to be a guest, you can go to moneyguide.com/apply. Or if you want to check out any of our tools or free resources, go to moneyguide.com/resources.

• 57:35Brian Preston?

  I'm your host, Brian, joined by Mr. Beau, Money Guy team, out.

• 57:40Speaker 06

  The Money Guy Show is hosted by Brian Preston and Beau Hanson. Brian and Beau are partners with Abound Wealth Management. Abound Wealth Management is a registered investment advisory firm regulated by the Securities and Exchange Commission in accordance and compliance with the securities, laws, and regulations. Abound Wealth Management does not render or offer to render personalized investment or tax advice through Making a Millionaire. 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. The guests featured on Making a Millionaire are not clients of Abound Wealth Management at the time of recording. Their participation should not be considered a testimonial or endorsement of Abound Wealth Management.