Are You a Wealth Builder Or Buster?

Are you actually building wealth, or are your money habits quietly holding you back? Inspired by the traits in The Millionaire Next Door, Brian and Bo break down 7 habits of wealth builders and everyday millionaires—from living below your means and investing intentionally to avoiding lifestyle inflation, raising financially independent kids, and choosing a career that creates opportunity. Learn how disciplined saving, investing, budgeting, financial independence, and smart money decisions can shape your long-term net worth. If you’ve wondered how millionaires build wealth, what wealthy people do differently, or whether you’re on the path to financial freedom, these seven questions can help you evaluate your progress. ⁠⁠⁠⁠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.

• 0:02Speaker 00

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• 0:30Speaker 01

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• 0:39Speaker 02

  I remember telling my boss, "It'll be good for the brand" when leads were slow. Yeah, it, it wasn't.

• 0:47Speaker 01

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• 1:05Brian Preston?

  Are you a wealth builder or a buster? Seven questions you need to answer the TLC episode.

• 1:12Speaker 04

  Brian, I am so excited about this because when it comes to being wealthy, when it comes to being a millionaire, having financial success, when you look at all the people that have been able to do that, all the people that have achieved that level, it seems that there are some common traits, some common characteristics that exist amongst that population. So if we can define what those characteristics are and then ask ourselves the question, "Do I possess these characteristics?", it should give us an indication of, "Are we on the right path?"

• 1:39Brian Preston?

  Well, and we were, we were like, "Look, somebody who has literally written the book, Dr. Thomas Stanley and Danko, when they did the Millionaire Next Door, they list the seven traits that millionaires have." Now, we took some, we, we massaged a few of these to bring, bring them up to 2026 as, as we cover it. We also were like, "Well, while we're doing this mashup, why not incorporate also?", because I couldn't help but think about it when you're thinking about wealth builder versus a buster, or said differently, busta. Why not bring this out to, "We have six TLC references in today's show", because at the end of the day, we don't want no scrubs. And I want to invite you to figure out if you can find all six of them and put them in the comments.

• 2:23Speaker 04

  I love it. I love it. All right. Let's talk about the very first trait. And this is one, I would say a money guy echo, but they probably were saying it before we started saying it. But it's something you've heard here a lot. Answer this question, "Do you live below your means? Are you actually saving and deferring a little bit of today for a great, big, beautiful tomorrow?" And I think, Brian, most Americans, they actually don't fall into this camp.

• 2:47Brian Preston?

  No, there's, you know, look, we, we've known this, most people are bustas. And the fact that they, they just don't live within their means. I mean, they're, they're basically using leverage, they're using debt, they're living a life beyond what they actually can afford. So I, I don't like the living paycheck to paycheck, you know? And that's the thing, Dr. Stanley said, "Operating a household without a budget is akin to operating a business without a plan, without goals and without direction." So we've got to do better than that.

• 3:17Speaker 04

  Yeah. If you're someone who finds yourself not doing this well and you recognize that, "Man, at the end of every pay cycle, end of every month, there's just not enough money left over", perhaps you should start budgeting. Are you at least just listing out, "Where are my dollars going?" Because it's hard to know what to change and what to alter. If you don't have a clear picture of where those dollars are disappearing to, because when it comes to changing your financial life, most of us really only have two options. We can either make more money, increase our income, or we can spend less money to create that margin. So you have to figure out which one of those two do you have control over? And what are the steps that you can take to move into that direction?

• 3:55Brian Preston?

  Um, the next one, question two to ask yourself. Now, Dr. Stanley, when you read Millionaire Next Door, he frames it as time, money and energy. Well, we were like, well, energy, I would, I would rephrase it as our three ingredients to wealth building, which is, "Are you making the most of your time, money and discipline?" As I just alluded to, we lay out that there are three key things and we've kind of, if you, if you kind of look at this in the order that we typically talk about it, I go backwards. Discipline, are you exactly the, the point of, of the, the first thing we covered is, "Are you living within your means or on less than you make?" And if you do that, you'll create margin or the money that if you give it enough time, this thing gets magical with this power of compounding growth.

• 4:39Speaker 04

  And what's really interesting is no matter where you are in your financial journey, the amount of these ingredients you have available might not be the same. You might be someone who perhaps you didn't figure this out early on in life. And so you don't have as much time. So that means you have to increase how much discipline you're exercising. Or maybe you are brand new in your financial journey. And it's very difficult for you to create a ton of margin or a ton of money in your life. But if you have a lot of time, you can then use that to your advantage. So you have to figure out, "Where do I fall in each one of these three ingredients? And how can I maximize them for my own personal benefit?"

• 5:14Brian Preston?

  So at the end of the day, make sure you respect the three ingredients to wealth and don't go chasing waterfalls.

• 5:21Speaker 04

  All right. Let's talk about question number three. When you think about the way that you consume, do you value financial freedom over financial status? And I think that most people, especially in this country, they care more about the way they look, the way they perceive, the way that they show themselves to the world around them, rather than what their balance sheet actually says.

• 5:43Brian Preston?

  We have a show coming up that I can't wait to record where we show just three small decisions in your life will change how your entire wealth building journey goes. And that one of them, I'll go ahead and give the, the, the kind of peek behind the curtain, is the car you drive. And because I can just tell you, in my own life, I've watched so many of my friends, family and peers, who as soon as they graduate and get their first big job, they go and load it up with the new car loan. And you see that across the board with most people. And I think you have to quickly realize, if you're going to be a financial mutant, you value more the freedom than definitely how you look. And if you don't believe that, that this is what true wealth builders do, look at the stats on the top car brands that millionaires are driving.

• 6:27Brian Preston?

  And it's no surprise that Toyota's number one at 16%, Honda's number two at 15%, Ford with that F-150 stat that Millionaire Next Door made famous, you know, is, is right there. Lexus, Subaru, surprisingly BMW is number six. But it is one of those things where I think when you look at this data, it, it doesn't shock me to see Toyota and Honda at the top of the list.

• 6:50Speaker 04

  Yeah. When you think about millionaires, they value staying out of high interest debt. They value building up their investments. They value building up and saving for large future purchases. They don't care as much about what other people think. They care more about how they're providing and saving for their future financial self.

• 7:08Brian Preston?

  I, I, I think the big takeaway is that with truly being wealthy, wealth on your net worth statement is, is stealth wealth. You don't hear it. So in other words, you gotta creep. I'm telling you, you know, do it stealthily and creep.

• 7:23Speaker 04

  All right. Question, question number four that-

• 7:26Brian Preston?

  You're not doing a good job of like hiding this thing, but we're supposed to be putting pine straw over it.

• 7:30Speaker 04

  You think I'm the one who's giving it away?

• 7:31Brian Preston?

  Okay. Just act like, stay cool. Stay cool.

• 7:34Speaker 04

  Yeah, no, that's totally, it's on me. All right. I'll do better. All right. Uh, question number four, uh, when you think about how you're building wealth, are you building wealth without parental support? Are you someone who actually was able to leave the nest and get out from under the wings of your parents? Meaning that you are self-sufficient, independent, without someone else pouring into you? Economic outpatient care.

• 7:55Brian Preston?

  Now, listen, we ain't too proud to beg, but at some point you have to ask and figure out, "Do you really need help or can you do this on your own without help from loved ones?"

• 8:06Speaker 04

  In a survey that we do for our millionaires and our abound clients every single year, we ask, "Hey, how much did an inheritance play a role in you building wealth? And you getting to the financial status that you're at?" And 74% of our clients here at Abound Wealth received less than a $25,000 inheritance on their way to reach $1 million. So what that means is these are first generation, self-made people or people that were not depending on their parents to prop them up to get them to financial success.

• 8:36Brian Preston?

  And by the way, it's not just our surveys. Uh, this was one of the big stats that came out of Millionaire Next Door that shocked me. It was because they had 80%. I know when Sarah, you know, Dr. Stanley's daughter came out with her, the updated version of the, the next Millionaire's Next Door.

• 8:51Speaker 04

  That's right.

• 8:51Brian Preston?

  Um, she also found the same stats as well as Ramsey Solutions found it in their own survey. So this is a pretty consistent throughout the ages. It's close to 80% of, of millionaires are first generation. But that also means 70% goes by second generation, 90% by the, the, the third with the grandkids. Be deliberate with how you're using your money.

• 9:13Speaker 04

  And this actually goes both ways. Uh, one trait is that, that millionaires don't receive economic outpatient care from their parents, but they also have the ability to build self-sufficient children on their own. Millionaires have the tendency that they teach their kids how to make wise financial decisions, how to, how to fly out of the nest and be self-sufficient on their own.

• 9:35Brian Preston?

  Yeah. And I mean, that's why, here's a shock stat for you. 75% of parents are supporting at least one of their adult children out there. And to the tune of around $7,000 a year, according to AARP. This is, this is one of those things where, look, I know we love our children and I think we get a lot of pushback whenever I cover the financial order of operations with the fact that we have, you know, there's a reason we have the diploma, I mean, the, the cap and gown on step number eight is that we want you to build your financial security first before you help the kids out, but also we want you to build, help them build the skill set to have independence. When I gave you that 70% is gone by first, by second generation,

• 10:19Brian Preston?

  90% by second. This is so you don't have to fall into that trap. Make sure that your kids' best days are not just the days that they live under your roof.

• 10:28Speaker 04

  And again, it's just, it's worth repeating. It's okay if you help your kids out if they're in a tight spot, or maybe you have the means and mechanism to create an opportunity for them that might not have been available otherwise. That's different than subsidizing lifestyle. If what you're doing is covering the mortgage payment, or covering the car payment, or paying for the fill in the blank, that's where the line becomes very blurred and it can be not a super great situation.

• 10:55Brian Preston?

  Yeah. And I just don't like, these results definitely end up being unpretty.

• 10:59Speaker 04

  All right, Brian, let's look at this next question. Question number six.

• 11:03Brian Preston?

  Pine straw.

• 11:04Speaker 04

  Are you, are you good at identifying market opportunities? When Dr. Stan, Dr. Stanley, Dr. Danko looked at their millionaires, they found that their millionaires could find specific niches and they were able to take advantages of needs in the marketplace to find ways to position themselves for the opportunity to build wealth. They didn't sit back and let life happen. They were very proactive and opportunistic when opportunities presented themselves.

• 11:31Brian Preston?

  Yeah. I mean, this is one of those things, you know, one of the big things we're always talking about is always be buying is because I think that all humans struggle with this fear and greed component. But I think once you build a little wisdom or depth of understanding of how money works, you're going to find that you won't be prone to all those emotional things and you'll be right there in the right position with your cash, with your structure, with your financial order of operations to where you get to identify and then, you know, maximize any market opportunity that comes your way in life.

• 12:01Speaker 04

  And then one of the final things, one of the ways that you make sure you're recognizing opportunities is did you choose the right occupation? When you set out to say, this is what I'll do professionally for my career, did you choose an occupation that aligned both with what the marketplace desired as well as your unique skill sets?

• 12:20Brian Preston?

  Yeah. Something you want to know is that not everybody's a brain surgeon, not everybody's a professional athlete. You'd be kind of shocked to see the typical careers that millionaires occupy are everyday things. It's like your engineers, your accountants, your teachers, your management, your attorneys. These are people who consistently are just saving and investing, putting money forward, consistent income that allows you to let this wealth build up slowly in the background.

• 12:49Speaker 04

  Yeah. They provide ample opportunities, job stability, stable income, the ability to create margin, the ability to exercise the three ingredients of wealth creation. So if you were going to summarize what these seven traits were, or these seven questions you ought to ask yourself, this is what's true of millionaires, of people that are able to build wealth. They live well below their means. They make the most of their time, their money, and their discipline. They value financial freedom over luxury or financial status. They don't depend on their parents for financial support. They have self-sufficient children. They recognize and take advantage of market opportunities and they chose the right job and they chose the right vocation.

• 13:28Brian Preston?

  At the end of the day, I want you to be a builder, not a buster. And how you do that is with the financial order of operations. If you're one of these people, just like I was, just like Beau was, where you don't come from money, but you, but you have a lot of ambition, you know, you want to better yourself. We have created the thing to tell you exactly the instruction manual to know what to do with your next dollar.

• 13:49Speaker 04

  Brian, I love that we get to sit here and we get to define what makes a builder and what makes a buster. And we can even, yep, that one. We can even answer your questions around, how do I make this decision as a builder and not a, not a buster? And so with that, we want to answer your questions and load you up. So if you have a question right now, we have the team out in the wings collecting them. Make sure you get them in the chat because we do believe there's a better way to do money.

• 14:17Brian Preston?

  Now, Rebi, we, and just the, as you can see, we, we surveyed our clients and that content showed up in this. Right now, I would be amiss if I didn't share that there's a lot of wealth builders who could share what they're doing with their money right now through our listener survey. Can you give us some details on that?

• 14:37Speaker 05

  Absolutely. Go to moneyguy.com/survey. If you want your voice to be heard and your voice and perspective to shape the Money Guy Show really into the new year and for the whole next year. Every fall, we give our audience a chance to fill out the Financial Mutants survey and tell us where you are. What are your pain points? What does your financial situation look like? What problems are you trying to solve and how can Money Guy help you figure that out? That's what it's all about. So that survey's only going to be open for one day more. So this is your last chance to get in and figure out how your voice can shape the show. And I really mean it. I want to know if you are still paying off debt. I want to know if you're on step nine of the foo, or if you've hit

• 15:22Speaker 05

  your coast fine number, or if you're in the messy middle. I want to know all of it because we want to know who is out there listening and how we can speak to you specifically. So I'm very excited about that. Be sure to go out to moneyguy.com/survey to take part of that because we're going to be creating not one, but two episodes off of that content, sharing the results.

• 15:42Brian Preston?

  Yeah. This thing closes down in the next day, correct?

• 15:45Speaker 05

  Yes, sir.

• 15:46Brian Preston?

  I need you guys to do this, you know, because it really, we, we count on the more of you who get in there and do this survey, the better the content gets because we actually get the numbers that make this more worthwhile and I think have a bigger reach. So I'd love for everybody to get in there, help us out with this. Y'all know when we, when we do these surveys and stuff, we don't pepper you with a lot of things. We're just trying to get the best information so we can give you the best content and make it the most educational version that it can possibly be.

• 16:14Speaker 04

  Yep.

• 16:15Speaker 05

  Love it.

• 16:16Brian Preston?

  Well, I don't get the feeling that you're a big TLC fan like I am.

• 16:18Speaker 04

  Uh, I knew, well, I knew, do you remember Total Request Live? Was that big in your, was that big in your?

• 16:24Brian Preston?

  I see Carson Daly, he's like, you know, he's on the Today Show every morning.

• 16:27Speaker 04

  Didn't know that. I mean, I did know that, but I don't like, well, I'm not familiar with that. But I remember TLC when they had like TRL like hits, like no scrubs. I got that.

• 16:36Brian Preston?

  Well, I mean, you are, you're a little under, you, truthfully, if you were watching TLC when they were really hot, I'd question, you're already, you know, some questionable things in your, your child raising already. But it is one of those things where I was knee deep in college when TLC was really popping.

• 16:53Speaker 04

  Oh, yeah.

• 16:54Brian Preston?

  So, and I can remember, I don't mind sharing that I still, because back in college, there were two bands. It just seemed like anytime you turned on the radio, it was Alanis Morissette and, um, you know, all of her really ticked off at the Full House guy, um, stuff that was out there. And then there was TLC. And I remember when the song, Don't Go Chasing Waterfalls came out, because AIDS and all these things that were, MTV was just everywhere. I got to the point, I didn't even know what gaslighting was, but I had convinced everybody, anytime Don't Go Chasing Waterfalls came on, I would tell everybody it was my college roommate's favorite song. And eventually I just broke him, but where he just agreed. So now, now when I take, every time that song comes on, because my

• 17:37Brian Preston?

  youngest daughter loves TLC. We listen to a lot of TLC in my car driving to school because she likes all the old R and B songs. We have to do the clean version.

• 17:47Speaker 04

  Sure.

• 17:47Brian Preston?

  Unfortunately, it was much easier back then. It feels like clean versions exist much more back then than they do now. But she loves listening to that. And every now and then I'll take a picture or screenshot and send it to my college roommate.

• 17:58Speaker 04

  Thank you, everybody.

• 17:59Brian Preston?

  Like, man, thinking of you because your favorite song came on. And it just, I don't know why that's so entertaining to me, but it really is.

• 18:04Speaker 04

  Had I been a casual listener, listening to this episode, I don't think I'd have gotten all six. I'd have gotten, I think, probably three of them, maybe four.

• 18:11Brian Preston?

  I bet people got six.

• 18:12Speaker 04

  Not a chance I'd have gotten all six.

• 18:14Brian Preston?

  Plus, you didn't do a good job of hiding it.

• 18:16Speaker 04

  Oh yeah. I was the one who was.

• 18:18Brian Preston?

  And you snickered every time I did it.

• 18:20Speaker 05

  I laughed every time you said buster.

• 18:23Speaker 04

  I mean.

• 18:24Brian Preston?

  That's appropriate. I was trying to get them to change the name of the show to buster. Nobody would do it. They actually wanted to use Buster, Buster. That's so boring.

• 18:36Speaker 05

  Well, you really covered the bases though.

• 18:38Brian Preston?

  Content team was with me on this thing. Y'all were down.

• 18:42Speaker 04

  Great. Y'all did great. All right. You want to answer some questions?

• 18:45Speaker 05

  We absolutely do. Galaxy nine is up first. He says, I'm 30 years old, married with a second kid on the way. Congrats. Cash reserves are great, but baseline expenses are climbing. How do we present, prevent lifestyle creep, quote unquote, versus legitimate family budget growth?

• 19:04Speaker 04

  Yeah, I think this is, because you've heard us say, Galaxy, that lifestyle creep gets such a bad rap. And it's always perceived as this negative thing, but the increase of our lifestyle through time is not a bad thing. I think most people want their 30s lifestyle to be better than their 20s lifestyle, their 40s to be better than the 30s, so on and so forth. And so the question you're asking is how can I do that, but make sure that I'm not doing it wrong or getting it out of whack? This is one of the reasons why we love the idea of paying yourself first. So when you get pay raises, when you get bonuses, what we want you to be doing is shooting for and striving to get to a 25% savings rate. And while you may not be there today, maybe you're 30 years old and you've got these two kids or you've got this second kid in the way, and you're at a 15% or 60% savings rate. That's fantastic.

• 19:49Speaker 04

  What we want you to do is as you have a bonus come in, or as you have a pay raise come in, have some portion of that automatically go to your savings. Say, I'm going to increase my savings rate from 60% to 70%. And then with the remainder, what's left over, it's totally fine for that to go to lifestyle, for that to go to increasing whatever those things are. It's not like every additional dollar you make has to be saved. So if you can save first and then spend, you're going to keep yourself on solid financial footing through time and make sure you don't get out ahead of your skis.

• 20:19Brian Preston?

  Galaxy, I need you to have accountability because this is, we just did a show that did really well, by the way, the wealth window. Because I've heard nobody else talking about, you know, yes, of course, if you can start saving and investing in your 20s, you're going to be golden. But most people just don't have that margin in their life. So it's really that period of time between 32 to 48 that you gotta get the work done on saving something for the future. But the problem is that's also when life starts really stretching on you is because you have kids, you get married, you start having to buy, you know, think about houses, all the activity fees for the kids. We're just here to tell you, there's nothing wrong, exactly what Bo said, with your lifestyle growing during this very important season of your life.

• 21:03Brian Preston?

  But I just want you to be whispering and pushing a little bit of the small, you know, as you get incremental pay raises, because that's the other thing the data shows is that you are getting more mastery in your career. You're getting bigger pay raises. Make sure some of that's showing up on the net worth statement, you know? And it doesn't have to be all of it. I'd like, you know, a 60, 40 split is what we talk about with pay raises. Is let 60% go towards your automated investments until you can ultimately get it up to 25% of your gross income. Count that employer match if your income's under $200,000, but do something so that that money's growing. So you don't get into your, when you get to be my decade of in your 50s and beyond, and have huge regrets because you didn't take any bit of time to sacrifice and build something for the future.

• 21:50Speaker 05

  Galaxy nine, thank you for the question. Fellow messy middle, represent.

• 21:56Speaker 05

  Shay S. is the next, what? What do you, you think, was that the equivalent of saying busta?

• 22:01Speaker 04

  No, you nailed it. No, that's, yep, you're great.

• 22:04Speaker 05

  We're going to move on to Shay S.'s question.

• 22:09Speaker 05

  What happens to my HSA after death? I'm 44. Today I have 90K and I max it annually, investing and never using it. Will my kids be taxed? Can they use the funds if they don't have a high deductible health plan? Interesting question. We love HSA. What happens if somebody inherits it?

• 22:27Brian Preston?

  I mean, we did a full deep dive HSA show. This is probably a number of years ago. I mean, we've been doing this since 2006, so things, but this part of the tax code hasn't changed. I know for a fact it hasn't. And we, we actually shared the tax code in that earlier episode to where it showed that indeed your executor or executor tricks can, can indeed go back and claim that tax-free distribution from the health savings account. But you make a great point Shay. If you have, if you're doing this strategy where you're, and for those who don't know, we love health savings accounts because they are triple tax advantage. It's one of the few vehicles out there where you get a tax deduction for your contribution. It grows tax-deferred while it's in the account. And if you pull the money out for qualified medical expenses,

• 23:12Brian Preston?

  it grows completely tax-free. So you've got it all, you've got going in and coming out if you structure it right. So that's why there's a lot of incentive to not use it as a clearing account, but to actually let the money grow and invest. But you probably need to write a note to your executor, put it with your will and all of your other important documents, that this is what you're doing so that that is not, you know, overseen, because it's sometimes chaotic after you leave the earth. You want to make sure you let the people you love know what you're doing.

• 23:40Speaker 04

  Yeah. If the, if your estate does not have copies of the receipts or of the charges, they won't be able to reimburse that money for free. And then once you pass, you can't then use those dollars in the same way that you could prior to death. And so one of the things that we tell our clients to do is we love building up HSAs, treating them like long-term retirement vehicles. But what ends up happening, and this is what we've seen practically, if someone will build up their HSA, they might have 100,000, 200,000, a substantial sum of money in there. And they'll have all these expenses that they've accumulated over the last 30 or 40 years, where they could reimburse themselves if they need to. But what they'll start doing is they'll just start using that for their retire, retirement medical expenses. Hey, I had to go do this thing. I'm going to use my HSA.

• 24:21Speaker 04

  Okay, I gotta go to this. I'm using my HSA. And then if we're doing some tax planning, we get to the end of the year, we're like, hey, I know we did that tax planning where we wanted to make sure we stayed below the IRMA surcharge, but we're going on this trip and I gotta make a deposit and so I need $10,000. What do I do? Well, the HSA is a great place to go get tax-free money for those expenses that maybe you weren't counting on, that won't affect your other tax plan that you're doing. So our clients kind of use it as a current medical expenses in retirement, plus one-off, uh-oh, I didn't know I was going to have this expense need. And it's tax-free, completely available money. That's how most people end up, and most people spend them down,

• 25:01Speaker 04

  I would say relatively quickly in retirement. Very rarely do I see someone passing away with a large HSA balance, because it usually shifts once you retire.

• 25:10Brian Preston?

  We, I've seen it with clients where we've done it during Roth conversions, when we're doing Roth conversions and we need to legally manipulate the tax code. And I've even seen it when we're downsizing like a house and we haven't, so we're, you know, we didn't sell the first house. We, we, you know, we, we built the new, or moved to a retirement community, and there might be a little of overlap before you sell the old house. HSA is a great place to go grab that money without a tax benefit, you know, without a tax issue, so that we can make the transition to a smaller home and then sell and then refund, you know, load the money back up into our taxable accounts.

• 25:44Speaker 04

  Yep.

• 25:49Speaker 00

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• 26:17Speaker 01

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• 26:26Speaker 02

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• 26:34Speaker 01

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• 26:48Speaker 05

  Shay, thank you for the question. Appreciate you being here. If you are watching us live right now, be sure to get your rapid fire questions into the chat. Just put RF at the beginning of your question, and we may choose that for our rapid fire segment coming up a little bit later in the show.

• 27:03Brian Preston?

  And also, even if you're not watching this live, because this will stay up and go out there, do the survey. I, I, we really need people, because I asked Rebi, I was like, Rebi, how are the numbers looking? And you're like, good. But man, it would be nice. And, you know, and I know a lot of people procrastinate, unfortunately. So we just want to make sure that we match the numbers that we did last year. Because I know there's a lot of new people out there and I want to make sure their voices are heard too.

• 27:28Speaker 05

  Love it.

• 27:30Speaker 05

  Devo6912 is our next question. Money Guy team, are less people wealthy because they do not understand compounding and time? Or is it, do you think, they have high housing, vehicles, or lifestyle costs and never get those, give those costs a second look? This is like a what do you think question?

• 27:53Brian Preston?

  Can I give the hot take here that's going to make me sound like an old man? I'll be the old man on the front porch and then let Bo be the nice guy here. Cause hopefully I get enough goodwill from talking about TLC earlier. Is that, I mean, the stat, cause I had mentioned it in that wealth window show, but I had talked about, you know, where the source was. Well, now we know the source is from the Federal Reserve, that the typical 65 to 74 year old doesn't have more than $200,000 saved for retirement. And look, without a doubt for young people right now, housing stinks, you know, and we've done a lot of content on that. But housing didn't stink for those baby boomers who were, who were between that 65 to 74 age,

• 28:38Brian Preston?

  but yet there's no savings. So I think that you, yes, it is harder for younger people to think about it with housing. But if you go look at the stats for the people who are the generations ahead of the current generation, they had cheap housing and they still don't have money for retirement. So I think there's definitely a discipline component that is disconnected, that people just procrastinate and don't realize how valuable it is to start saving something, just doing something. I don't care if it's just getting your employer match and then just maybe funding a Roth IRA while you're in your twenties, thirties, and forties will literally change your life.

• 29:12Speaker 04

  I think that we, we as a society, we struggle with deferred gratification across the board. It's why we're probably not as healthy as we ought to be. We don't make as wise decisions around that as we should. It's the same with our finances. I think it's really easy. Oh, well, I want this thing today, so I'm going to do it, or I want to have this thing. And so we live in this consumption society with the idea of procrastination. Oh, well, I'll, I'll save next year. When I get the pay raise, then I'll save. And they end up pushing it, pushing it, pushing it. And it is a reality that housing is expensive and vehicles are expensive and lifestyle, even in today's society, can be expensive. But we really do have a belief that anyone can build wealth, no matter where, we've

• 29:54Speaker 04

  even done episodes on how to build wealth if you only make X number of dollars. And we've kind of done it with different strata. It is possible, but if you have a lower income, if you have less margin, you have to exercise a whole lot more discipline and you have to be willing to do that for a longer period of time. I think it's a combination. I think that people don't understand that, you know, $95 for a 20 year old can turn into a million dollars invested monthly until 65. They don't understand it, but then they're also blinded by, I want what I want right now, today. I don't want to think about the future. I'd rather have it right now. It's why we have such a big debt problem. Not only are we really bad at deferring into the future, we're also really bad at robbing from our future selves.

• 30:39Speaker 04

  It's why we have this debt epidemic that's going on in America.

• 30:42Brian Preston?

  We were reviewing a show that we're going to be recording after this show, the live stream, where it was showing the savings behaviors of Americans from the 1960s all the way through 2020 something, you know? I can't remember if it was last year or the year before, but we were saving over 10% as a country, all the way until the early eighties. And, and I think that that's, and Rose, this is from the sixties and seventies and eight, and even early eighties, most people had pensions.

• 31:09Speaker 04

  Pension era.

• 31:10Brian Preston?

  So it was 10% and then they had people had pensions on top of that. We lost something and I blame, I lay a lot of this on the banking system has gotten really good and encouraging consumption through, for their credit cards, through other, and we try to create and educate you guys so you don't fall in this consumption trap that has been laid for you when, when there's so much opportunity. Because with index funds and, and access to where you can do everything on your mobile phone now, it's actually the easiest time in the world to actually start doing something. But so often people just get distracted and I think then they create their own trap of debt that they can't even get out of.

• 31:49Speaker 04

  Not only is it the, not only is it the easiest time in the world to invest, it's also the easiest time to get distracted because now you pull up your investing app and all of a sudden on the side, there's sports betting or prediction markets or all, there's a thousand different things vying for your attention that can very easily pull you away from doing the thing that's worked for the last hundred years, living a lesson you make, putting it to work, investing in low cost indexes and watching your dollars grow.

• 32:13Brian Preston?

  Don't try to beat the market, be the market and you're going to be just fine.

• 32:16Speaker 05

  You're going to be just fine. Love it. Devo6912, thank you for the question. Appreciate you being here during the live stream. Foo Cast Bullish is up next. I don't know what that means, but that's the usual.

• 32:30Brian Preston?

  I like it. Yeah, get creative with the foo.

• 32:32Speaker 05

  Hey, Money Guy team, would you prioritize paying down a 7.5% HELOC or funding a Roth IRA? I have no other debt. Foo Cast, I bet they're going to ask you your age. So if you're out there and want to share that in the chat, we would love to know because that might help.

• 32:49Speaker 04

  I do want to know the age, when, now, if you have a seven and a half percent HELOC.

• 32:52Brian Preston?

  What was that? Why was that even taken?

• 32:54Speaker 04

  When you say no other debt, does that mean you don't have a mortgage either? I bet there's a mortgage outstanding somewhere, right? There's probably a primary mortgage outstanding on that. And then you have this home equity line of credit. A few things I'd want to know. I want to know your age and I'd love to know what your current balance sheet looks like. How much do you currently have saved and invested? Do you have a big pot of assets that are working for you that are growing and compounding right now, where it makes sense to really attack the seven and a half percent HELOC to knock it down? Or have you procrastinated? Have you not been building and you really don't have any investment assets built up? I'd like to know the answer to those questions and I'd also like to know the size of the HELOC. Is this a $150,000 home equity line at seven and a half percent?

• 33:39Speaker 04

  Or is it a $10,000 home equity line?

• 33:41Brian Preston?

  Well, that gets to the point of the context of what created the home equity line. Because if you went and bought a car with a home equity line, that's a disaster. I mean, you should, at least then I can give you the context of, no, you, what you, let's, let's correct your path of what you, the mistake that was made and then how we get back on track. Treat it like 238, you know, so that way maybe we can still do our Roth IRA and correct the mistake. And then if it's, if it's something where you actually did make an improvement on the house, I mean, I will tell you, I, I don't mind people using home equity lines, but it needs to be just a momentary.

• 34:16Speaker 04

  That's right.

• 34:17Brian Preston?

  Momentary bridge to get you through this moment in time and probably not any longer than three years, maybe, you could maybe convince me four years. So, because I don't want this thing to occupy all of your free cash flow. If you, if you can't do a home improvement and not pay off the home equity line within that three to four year period, you might just need to defer not doing the home improvement so that you're not sacrificing your future retirement. So that's why I hate retroactively, but we have to triage your financial life exactly where it is. And that's why Bo's point of it depends with all the additional context, so we can make sure that we're not just saying, hey, no, no problem. Just pay off that, pay the seven and a half percent home equity line.

• 35:01Brian Preston?

  Don't even worry about the Roth until you get it figured out. I need a little more context so we can give you the right pinpointed plan of action for your, your specific situation.

• 35:10Speaker 05

  I don't think we ever got that information from Foo Cast.

• 35:15Speaker 04

  I did not see it come through.

• 35:16Speaker 05

  But that's all right. I think you talked around the possibilities there. So we appreciate the question and we're going to move on for one more question before we get to our rapid fire segment. So RF in front of your question in the live chat, if you want to be part of our rapid fire segment. But first, B892 has a question. It says, hi, Money Guy team. I'm 25 with one, with 105K in annual income on step four of the foo.

• 35:42Brian Preston?

  Wow.

• 35:43Speaker 05

  I want to change to a more fulfilling career that would likely drop my salary by 20K and have less benefits. How do I plan for this?

• 35:53Brian Preston?

  I mean, this is probably the time to do it.

• 35:56Speaker 04

  Yeah. If you're, if you're in step four, you're building up an emergency fund, what I would do is I'd probably build up that emergency fund even more than I think I need. Like if I'm building it up for six months, but I know I'm going to take this step back and pay, and I'm probably going to have to do some lifestyle adjustments because of that. I may want to build up to maybe seven, eight, nine months of liquidity, just so that way I don't have any shocks to the system. And then I gotta work really, really hard. If I was used to living off of 105,000 and now all of a sudden I'm going to be living off of 85,000, my net take home is likely going to drop, assuming I'm saving the same percentage. I want to make sure that I adjust my lifestyle accordingly to make sure I can do that. And by the way, there's nothing wrong with that.

• 36:38Speaker 04

  We, we see people all the time, Brian, who want to come and work here, that they're doing very well in their careers and to end up coming and like restarting and repivot, they might have to take a step back. And that's totally okay because it's a better lifestyle choice, better long-term opportunity, better metrics looking forward. But you have to decide for yourself, okay, what are the things that matter? What's this going to, what's this going to affect long-term for my plan? And am I willing to accept those trade-offs?

• 37:04Brian Preston?

  B, let me be like your, your, your favorite nerdy uncle that you, you like to approach with, with decisions like this. I would ask you, I was like, you're at the perfect stage to make a choice like this, but is this a short-term solution, meaning that you have to take this step back to get you out of the unhappiness situation, unhappiness of the situation you're in? But this is only the first of multiple steps? Or is this truly, you're going to take a step back for a much bigger opportunity down the road? Because Bo, as Bo just alluded to, we do have career changers that come in here. And I got, one of my favorite things as an employer is because we've had some brilliant engineers, people from the medical profession, others who are musicians, producers who've come on and done this.

• 37:49Brian Preston?

  And I like to think that for many of them, this has turned out to be the best career, not from just a quality of life, but also even economically for their families has turned out to be a great opportunity. That's the filter B I need you to do is because that you have to, look, despite what society tells you, jumping around every two years is not ideal for creating the resume that lets an employer or your future self feel like you built community or the best version of yourself. Think long-term, begin with the end in mind of how you, this transition is going to change. Measure twice, cut once. If this is the right decision, do it, but just make sure you're not thinking just in this moment in time for the next 12 or 24 months.

• 38:32Brian Preston?

  Let's think what 60 months or even 10 years looks like if you make this step.

• 38:38Speaker 05

  Love it. Thank you so much for the question. B892. Appreciate you being here. With that, we are going to move into our it does not depend rapid fire segment where Bo and Brian answer your questions in a combined 30 seconds without saying the words, it depends. And just in case there's something really important that they can't fit into that time, we will address them in a segment at the end. And I do have a little bit of a twist halfway through this one.

• 39:06Speaker 04

  You have to give us the lyrics.

• 39:08Brian Preston?

  No, don't make me do that.

• 39:09Speaker 05

  No, we're not gonna do that. Uh, we'll get 30 seconds on the clock.

• 39:15Brian Preston?

  I'll go first since you went first last week.

• 39:17Speaker 05

  And we will kick it off with the first question for rapid fire. Are you ready?

• 39:23Brian Preston?

  As ready as I'm going to be.

• 39:24Speaker 05

  You're supposed to say I was born ready.

• 39:26Brian Preston?

  Born.

• 39:27Speaker 05

  Let's get some confidence going.

• 39:28Brian Preston?

  Born ready.

• 39:29Speaker 05

  There we go. All right. First question. In retirement, do you have a set percentage of net worth that should be your primary residence assumed it's paid off?

• 39:40Brian Preston?

  No, it's your primary residence, as long as it's paid for in cash. And I would take into account the living expenses and make sure that fits within your withdrawal strategy.

• 39:50Speaker 04

  I would also say no. A lot, we've had a lot of people who retire in a home that they might've bought 30 years ago, but it might've been on the coast or something like that. And if you look at the value of their home, it might represent a large portion of that worth, only because they've owned it for so long. What we care more about is your liquid portfolio that's going to provide for your living expenses. You want to make sure that's large enough. I wouldn't worry about the size of the primary.

• 40:12Speaker 05

  All right. We've done the first question. Number two. What are some financial mutant hacks or tips for moving?

• 40:20Speaker 04

  Financial mutant hacks or tips for, uh, pay someone else to do it. I mean, that's not a financial, that's not a financial mutant hack. That's not a financial mutant tip, but I do not like moving.

• 40:29Brian Preston?

  I mean, try to minimize it as much as possible and then, you know, protect your back. It's more longevity.

• 40:37Speaker 05

  Health is wealth.

• 40:38Speaker 04

  Health is wealth.

• 40:39Brian Preston?

  I mean, that one, can we say that one needs to have a lot of depends? I'm just gonna say it. I'll come, I need to come back to that moving.

• 40:46Speaker 04

  Financial hacks and tips for moving. I mean, like.

• 40:48Brian Preston?

  I got some thoughts.

• 40:50Speaker 04

  Yeah, there's like doing the cheap. There's like having the buddies come.

• 40:53Speaker 05

  That really stumped you.

• 40:54Speaker 04

  Well, no.

• 40:55Brian Preston?

  Well, no, there's so many different labels. Cause look, I've moved four or five times. And I had to do it different ways and different stages of life.

• 41:03Speaker 04

  Exactly right. Yep.

• 41:05Speaker 05

  Question three.

• 41:06Speaker 04

  I need to know whoever asked that one. I need to know where are you at in life? Tell me where you're at in life and then I'll give you your hacks.

• 41:10Speaker 05

  If you ask that question, put it in the chat. We'll watch for your answer. Where are you in life? They'll come back to it, give you some moving tips and thoughts.

• 41:17Brian Preston?

  Okay.

• 41:17Speaker 05

  All right. Question three. Does the rule of 55 apply to a solo 401k when you are a sole proprietor?

• 41:25Speaker 04

  Are you ready for this? This is a doozy. No. Do you know why the rule of 55 does not apply to a solo 401k? Cause in order to have a solo 401k, it has to be an active plan that's opened up. This is one of the things we've sort of investigated and trying to figure out over the past couple of years. Our position is that solo 401k does not qualify for rule of 55. Because you are not an active, because you can't have a solo 401k if you're not actively participating in the 401k.

• 41:50Brian Preston?

  Did it say solo or was it separate?

• 41:52Speaker 05

  It says, uh, solo 401k.

• 41:54Brian Preston?

  Yeah. Okay. And Bo crushed it.

• 41:56Speaker 04

  Sorry. I didn't mean to go long.

• 41:57Brian Preston?

  Dude, no, it's fine. I'm still over here thinking about moving things.

• 42:02Speaker 05

  All right. Next question. Ramsey Solutions has a rule that quote unquote, things with motors should not have a value over 50% of your yearly income. Do the money guys have a similar rule?

• 42:17Brian Preston?

  You know, I've heard Dave do that in an interview. I think he did it on the Bobby Bones interview. And I was really impressed at the time because I mean, it is one of those things, but I've never,

• 42:26Brian Preston?

  I mean, that seems like common sense to have, because all those things are depreciating. I mean, every one of those things is depreciating. So I wouldn't want 50% going towards depreciating assets.

• 42:36Speaker 04

  Yeah. I think it's a good rule of thumb, but again.

• 42:38Brian Preston?

  It seems too high.

• 42:38Speaker 04

  Stage of life matters. If I'm a retired individual with a huge portfolio, but I don't have a huge income, but I want to buy the nice car, I'm not going to fight you on that.

• 42:46Speaker 05

  That's time. Do you want to come back to that?

• 42:48Speaker 04

  No, I mean, yeah, sure.

• 42:50Speaker 05

  You don't have to.

• 42:51Speaker 04

  Okay.

• 42:52Speaker 05

  Oh, okay. We'll see.

• 42:54Speaker 04

  It's a nice rule, but I'm, I'd have to go do the math to figure out.

• 42:57Speaker 05

  We'll come back to it. We'll come back to it.

• 42:58Speaker 04

  Fail.

• 43:00Brian Preston?

  Yeah.

• 43:01Speaker 05

  All right. Next question. And then after this question, we're going to have a little twist. So stay tuned. Is it okay to pause investing, except for your 401k match for just a year so that I can save for a home?

• 43:15Speaker 04

  Yeah, it's absolutely. Your financial goals are your financial goals and you want to use your money to achieve whatever your goals are. And if one of the goals is homeownership, in order to do that, you have to pause investing to get there. That's okay. You just need to recognize there's a big opportunity cost for doing that.

• 43:30Brian Preston?

  Yeah, I, I, I'm okay with as long as it covers step two, three, and four. Um, anything after those is, it's okay to defer, but don't skip out on the match. Don't skip out on paying 20% interest to banks and then definitely have a cash reserves.

• 43:46Speaker 05

  Well done. All right. For the last few questions, we are going to change it up and put 15 seconds on the clock.

• 43:53Brian Preston?

  No, we can't do that.

• 43:54Speaker 05

  Let's just see what happens. Humor me.

• 43:56Speaker 04

  You go first.

• 43:56Speaker 05

  If it doesn't go well, we'll tackle them all in the ending segment. So with 15 seconds on the clock, the question is, is it worth it to withdraw Roth IRA contributions to pay off high interest debt?

• 44:13Brian Preston?

  No.

• 44:14Speaker 04

  I say no too, because those dollars, it's very costly when you look at opportunity cost standpoint. If I would find every other mechanism in the world to pay that off without pulling out the Roth.

• 44:24Brian Preston?

  Go work a second job.

• 44:25Speaker 05

  Wow. Look at that. Under 15 seconds.

• 44:29Speaker 04

  Had plenty of time.

• 44:30Speaker 05

  Solid answer too.

• 44:33Speaker 05

  Next question. How do you acknowledge your accomplishments? I finished my credit card debt earlier this year at 24, but feel underwhelmed still that I have less than a month in my emergency fund.

• 44:44Speaker 04

  That's okay. You're still in the beginning stages. It's small wins, small wins, small victories lead to big wins, big victories.

• 44:50Brian Preston?

  And then join the money verse and go enter your, your wins there because you'll be surrounded by people just like you.

• 44:56Speaker 04

  Hype squad.

• 44:57Speaker 05

  Moneyguy.com/moneyverse. Look at that. Bam, bam, bam. 15 seconds. Next, does it ever make sense to target brokerage instead of maxing your 401k after getting your 401k match and maxing Roth IRA?

• 45:13Brian Preston?

  No, this is something we've covered. I think it's a marketing hype that there's groups out there saying this, but unless you're part of the fire movement and you're retiring like at 50, 55, I would rather you get the, the tax favored investing.

• 45:26Speaker 04

  Yes, there are times when you need to do that.

• 45:29Speaker 05

  We're coming back to that one. Agree, disagree, want to fight.

• 45:35Speaker 05

  All right. Last but not least, is the S and P 500 too concentrated in tech? If so, how do you recommend diversifying?

• 45:44Speaker 04

  No, I don't think it's too concentrated in tech. Right now it does have a tech bias, but I don't think it's too concentrated in tech. When you have a diversified portfolio, you'll branch out outside of just S and P.

• 45:54Brian Preston?

  It's been over concentrated in tech for probably the last 30 years.

• 45:59Speaker 05

  Not too shabby. Not too shabby, friends. How'd 15 seconds feel?

• 46:03Brian Preston?

  Not good.

• 46:06Brian Preston?

  That's like somebody asking you to help them move the couch. No, but worse. Can you help me move my piano? That's what that felt like to me is because it's even worse than moving a couch or refrigerator. It's like asking somebody to move a piano.

• 46:19Speaker 05

  15 seconds was like moving a piano?

• 46:21Brian Preston?

  Yeah, it's painful.

• 46:23Speaker 05

  Okay, noted, noted. Let us know. Give us some feedback. Do you like adding some 15 second timers in there or do you like 30? With that, let's move on to our it does not, or maybe it does depend segment where we're going to go revisit some of these questions. The first one was the moving, the tips for moving.

• 46:40Speaker 04

  So 32, step one, just finished grad school and take the CPA exam. We'll be in step three as soon as I start work. Thanks to good things. Awesome. Okay. That's the context.

• 46:49Brian Preston?

  So I, I was going to give the experience share is that early in my life, I did it on the cheap. U-Haul, um, called my friends and family to help me move because I didn't have a lot of stuff. Didn't inconvenience a lot of people. Next move, I upgraded to where I did U-Haul, but I used professional services to help me move the heavy stuff, meaning I did all the self packing. But then I had, because you can now add on professional services to help you actually load and unload the, the truck. And then the, the third, I mean, when I started moving into the nice house, like when I moved to Tennessee, I overlapped, meaning I didn't sell my first house until I'd already moved into the second house. And that's a luxury, but man, oh, man, does it make moving easier?

• 47:33Brian Preston?

  Because I didn't feel like I had to do it all at once and then have this, pack up your whole life and then hope that the timing works or create an interim period where you live in an apartment. But that's a privilege that you get to do after you've done all the other steps to where that's kind of like a step eight thing of the financial order of operations.

• 47:50Speaker 04

  Yeah. I generally have a rule. You don't move furniture after the age of 30, but you're 32. So I'm going to give you a little bit of a pass. Here's what I would do. I'd call a bunch of my buddies and be like, hey, you got pickup trucks. I'm going to rent a U-Haul and then bring pickup trucks. We're going to load those up. I will buy pizza and beer and that's how, that'll be what I pay you to do this and get it knocked out. Now, two tools you ought to buy that are game changers. The first furniture pad sliders.

• 48:14Brian Preston?

  And straps. Okay. I'm sorry. Keep going.

• 48:18Speaker 05

  Stole thunder.

• 48:19Speaker 04

  What are you doing?

• 48:20Brian Preston?

  Keep going. I'm sorry. I get excited.

• 48:21Speaker 04

  Furniture pad sliders. You know, the little, little discs that you put on the ground, you can set the furniture, you can actually move it around the house nice and smooth. Before we actually have to lift it. And second, the over the shoulder straps, over your shoulders, down under the piece of furniture. You can lift and move anything like that. It makes it so much easier. It will save your back. And you're like, holy cow, this is not nearly as hard as I thought.

• 48:42Brian Preston?

  I still have the straps at my house because every now and then I've had a few neighbors. I don't look, go ahead and I'll, I'll tell you. One of the reasons I don't like moving anything, I am in my 50s and I don't have back problems. And we have millionaire clients who have back problems because they did inappropriate stuff. So really measure twice, cut once on moving heavy stuff past a certain age too. But Bo is exactly right. And that way straps are great for moving appliances. They're great for moving couches. They're great for moving dressers, everything. I've done this stuff for clients. Cause also going upstairs, because they're somewhat secured by you, you don't have to, you know, bloody up your hands. Um, holding the stuff. It is, and it's so cheap if you go buy straps on, on Amazon.

• 49:26Speaker 04

  Cost of the straps.

• 49:27Speaker 05

  There you go. Look at you.

• 49:28Brian Preston?

  Every, truly every household, it's kind of like.

• 49:30Speaker 05

  Tips.

• 49:31Brian Preston?

  You know, have your water filter and your, your go bag, you know, and you know, your fire starters and those things. And then by moving straps, and these are things that should be in every person's house. Flashlights, you know, go bag for if things got really bad in your area, like the power was out for a week and then moving straps.

• 49:49Speaker 04

  I love it.

• 49:51Speaker 05

  I have some shopping to do.

• 49:56Speaker 04

  Make sure y'all put an affiliate link on this.

• 49:58Brian Preston?

  How many of y'all have LifeStraws? Do you know what those are? Where you can turn anything into drinking water, essentially? Look at, the content team all has their hands. Bo, do you have a LifeStraw in your house?

• 50:08Speaker 04

  You see, my wife has these glass straws that she likes to drink out of the clay.

• 50:12Brian Preston?

  Do you have LifeStraws in your house?

• 50:13Speaker 05

  No, I have a, I think I, the water filter I have is a LifeStraw brand. It just happens to be.

• 50:20Brian Preston?

  That doesn't let you go turn pond water into drinking water.

• 50:23Speaker 05

  No, I don't think so.

• 50:23Speaker 04

  Have you tested, have you went and drank, drank out of some like rank?

• 50:26Brian Preston?

  No, but I've, I've watched enough YouTube videos. I'm an expert.

• 50:31Speaker 04

  All right.

• 50:32Speaker 05

  All right.

• 50:33Speaker 04

  Make sure, put a, put a link to the, uh,

• 50:35Brian Preston?

  LifeStraws?

• 50:36Speaker 04

  LifeStraws as well, guys.

• 50:37Speaker 05

  Okay, we have a couple more to expound on.

• 50:40Brian Preston?

  I'm just kidding. I'm kidding. That one's a joke. That one's a joke. Didn't mean that one.

• 50:44Speaker 05

  I missed it.

• 50:45Speaker 04

  You know what's funny is I actually, uh, my mother-in-law, I don't know why, but she did buy, they're not MREs, but they're basically like the dried, I got a ton of those in my pantry. Like the dried food packets and stuff. I got a bunch of those. No, no drinking.

• 51:00Brian Preston?

  Why do you have them? Like she gave them to you for Christmas?

• 51:02Speaker 04

  There you go, son. Happy, Merry Christmas. A bunch of MREs.

• 51:06Brian Preston?

  Save your life.

• 51:07Speaker 04

  Maybe.

• 51:07Brian Preston?

  That's what she's thinking. I just saved my kid's life.

• 51:09Speaker 04

  Maybe. Thanks, Mom.

• 51:13Speaker 05

  All right. The other one that you kind of waffled on, or just it felt like you had more to say was about Ramsey's things with motors.

• 51:20Speaker 04

  Yeah.

• 51:21Speaker 05

  Not having a value over 50% of your yearly income. You had some more, it seemed like you had some more thoughts on that.

• 51:27Brian Preston?

  Okay, so I had to think about, so, cause we're rapid fire. So that means like if you make a hundred grand.

• 51:33Speaker 04

  You can't have a car more than 50, that worth more than $50,000.

• 51:38Brian Preston?

  Okay, well, what do you do by retirees?

• 51:41Speaker 04

  There you go. That was the whole, that was my whole point.

• 51:43Speaker 05

  That was where you were going. Yeah.

• 51:44Speaker 04

  If someone lives on a much lower income, or let's say.

• 51:46Brian Preston?

  No, cause it's disconnected from the reality of your net worth would drive what type, I think, I'd rather use, no, I don't, I think, I think, look, no, I don't, I don't, I don't love that for the, it doesn't make it through the whole continuing, no, look, in your early journeys, we're, we're on the same page as Ramsey, is that we want you to limit depreciating assets as much as possible, but I, I think there is a disconnect as, as you get older and have more success, cause I'm trying to free you to use and live your best life in retirement.

• 52:18Speaker 04

  Yep. And I think about even like, I got a bunch of buddies who like own boats and I'm so happy they own boats. So I don't own a boat, uh, but that, those rules would kind of start to fall apart, probably. If you think about like, if you got a boat in, I'm not saying you ought to have all those toys. There are certainly people that can't afford those and do that, but I would worry, would that hold in those situations?

• 52:38Brian Preston?

  I think it's good when you're young. I mean, this is back to the rule, I think Dave is so good at getting people out of debt, that it definitely helps out the 20, 30 something, but I think if you're somebody who's gone beyond the, the basics, that's when those rules get very nuanced. By the way, we also realized that, you know, we did the whole Busta and TLC reference. You know, no scrubs in your best friend's ride. We kind of realized that's the financial mutant in this story.

• 53:07Speaker 04

  They don't have a nice car.

• 53:08Brian Preston?

  That, that in TLC's song, that would be the Busta.

• 53:11Speaker 05

  That was Brian.

• 53:12Brian Preston?

  But in Part of My Life, that's actually the financial mutant, cause you want your best friend to have the fancy car that you can hang out of.

• 53:18Speaker 04

  That's right.

• 53:19Brian Preston?

  On the side, that, so we have, just let it be known that we think the, I'm trying to remember how the lyrics, can somebody remind me the lyrics in your best friend's ride, hanging out in the best friend's ride?

• 53:31Speaker 04

  Can I get you some lyrics?

• 53:33Brian Preston?

  That guy's the financial mutant.

• 53:36Speaker 04

  Keep talking. I'll get you some lyrics.

• 53:37Brian Preston?

  You're very slow. I was kind of hoping that we'd already be there.

• 53:41Speaker 04

  A scrub, uh, nope, that's the very beginning. Let's see, best friend's ride. No, I don't want no scrubs. No scrub, uh, a scrub is a guy that can't get no love from me. Hanging out the passenger side of his best friend's ride, trying to holla at me.

• 53:57Brian Preston?

  That's the financial mutant.

• 53:59Speaker 04

  I don't want a scrub.

• 54:00Brian Preston?

  That is the financial mutant.

• 54:01Speaker 04

  A scrub is a guy.

• 54:02Brian Preston?

  Last time I was wrong.

• 54:03Speaker 05

  So you're saying she should want the scrub?

• 54:05Brian Preston?

  She should want the guy hanging out of the passenger side. Just ask him if he funded his Roth IRA. Now we're, now we're on to something.

• 54:13Speaker 05

  Scrub. That's what you're trying to say.

• 54:16Brian Preston?

  Not a Busta there. Just doesn't have a car payment.

• 54:20Speaker 05

  Oh my goodness.

• 54:23Speaker 04

  Was there, was there any more in my depends?

• 54:24Speaker 05

  Last but not least, does it ever make sense to target brokerage instead of maxing a 401K?

• 54:29Brian Preston?

  Oh, gee, you said you disagree with me.

• 54:32Speaker 05

  I know.

• 54:32Speaker 04

  Personal finances, personal, there are, there are seasons and times when you're moving through the financial order of operations, as you get closer to when you're actually going to use those dollars. Like when you get into step seven, you're thinking about, all right, I'm about to retire and I want to make sure I've got my three buckets filled. Uh, maybe it doesn't make sense for me to continue saving in my employer-sponsored retirement account, my 401K, because I need to have those bridge assets for some reason or another. Maybe I'm retiring before 55, or I want some liquidity or flexibility for something. It may make sense at that time to shift and not max out the 401K, start building an after-tax brokerage account. We see people do that, but that's later on in your financial journey, not at the beginning.

• 55:11Brian Preston?

  But if you're in the first saving of 25% of your gross income, you know, now, cause there are people, if you make under a hundred grand and you're saving, you know, or, you know, somewhere between 80 to 100, you might reach 25% without maxing out your, your Roth, I mean, your, your 401K and then could still even get to doing after-tax in step seven, but that's what, you're gonna want to do the tax favorite stuff first. On the first 25%, that's why I think that is bad advice when you're helping people on the foundational side. Of course, when you're close to retirement, it gets much more nuanced, cause it's then gets very personalized. But, and I, but I do know there's firms out there that are marketing this.

• 55:52Speaker 04

  Yep.

• 55:52Brian Preston?

  Because they want to have a contrarian point, that they can say, this is the way to draw more clicks and eyeballs. And I'm here to tell you, just be careful when people try to create sensation that's disconnected from what is probably the, the advice that you need to be doing at the, at the beginning of your journey.

• 56:09Speaker 04

  Yep. We don't disagree. We said the same thing.

• 56:13Brian Preston?

  I know. It's just, it needs.

• 56:13Speaker 05

  There was more nuance. You need more than 15 seconds.

• 56:16Brian Preston?

  15 seconds or 30 seconds. You gotta, personal finance is very personal. Now, and I will say in the beginning step, when you're trying to figure out what to do with your next dollar, I think there's a lot of things, just like in math, there's an order of operations. There's definitely a financial order of operations. Don't let somebody's marketing or contra point get you in trouble when they're, when they're giving advice that might be great for a 55-year-old or a 50-year-old.

• 56:40Speaker 05

  All right. Let's, uh.

• 56:43Speaker 04

  Have you read, have you read the lyrics to No Scrubs before?

• 56:48Brian Preston?

  What else is in there?

• 56:49Speaker 05

  I know, I was.

• 56:50Speaker 04

  If you don't have a car and you're walking, oh yes, son, I'm talking to you. If you live at home with your mama, oh yes, son, I'm talking to you.

• 56:58Brian Preston?

  Definitely financial mutant.

• 57:01Speaker 04

  I'm sitting here thinking like, this guy's just saving money.

• 57:07Brian Preston?

  See, I told you this was a TLC episode.

• 57:09Speaker 05

  I will never be able to listen to this song the same way.

• 57:11Brian Preston?

  Forever altered.

• 57:13Speaker 04

  This guy's just saving money.

• 57:16Speaker 05

  I don't know if that's the association we want.

• 57:18Brian Preston?

  I knew last time was, you know, she might not have had it figured out with burning houses down and so forth, but maybe one of the others got it.

• 57:26Speaker 05

  Oh, man. All right. We're gonna close it out with a question from our friend Grill This, Smoke That.

• 57:33Brian Preston?

  Oh.

• 57:33Speaker 04

  Hey, Ben.

• 57:34Brian Preston?

  Ben's in here.

• 57:35Speaker 04

  What's up, Ben?

• 57:35Speaker 05

  He says, I want my family to start chasing waterfalls through travel. Once we are at step seven and eight, what percentage of income is acceptable to dedicate to experiences for the family?

• 57:49Brian Preston?

  Ben, we know you personally. You should go spend a ton of money on travel. I just know how good Ben's doing. And by the way, if you're not watching Grill This, Smoke That, like I see, it all shows up all over my TikTok. I know it's on Instagram and everything else. Ben makes me so, I want to go buy one of these grills just so I can cook breakfast. The way he cooks breakfast, or he made something the other day, pancakes where he used like food coloring and made a Georgia G. And I was like, how does he do this stuff? But he is killing it. And I, I think you, you should go make all the memories you want to make. Okay, now give the real advice.

• 58:23Speaker 04

  Yeah. So the answer is, is once you're in step seven, eight, Brian, hold the thing up for me. Once you're in step seven, rate of the financial order of operations, that lets me know you're already saving 25% of your gross income for the future. Well, the reason why we say to save 25% is so that after that point, you can spend lavishly on whatever you want. So how much is acceptable to spend on travel after that point? As much as you want. If you want to spend all of your extra discretionary cash flow on travel, that's totally fine. That's what the 25% is supposed to do for it. It's supposed to free you so that you can spend guilt-free. It doesn't matter if I spend on the hobby, or I spend on the travel, or I spend on the increasing lifestyle, whatever

• 59:02Speaker 04

  that is, 25% is that threshold that you cross over that now frees you to use your money however you want for today. So I think if you're already in step seven and eight, absolutely, and we would argue, if you're looking for some advice, spending money on travel and making memories and creating experiences, way more valuable, way more fun than spending it on things and cars and homes and that kind of stuff. So I think if you are at that place where you can start doing that, by all means, start doing it and don't feel guilty about it, cause I think that's awesome. That's exactly where you should be.

• 59:38Speaker 05

  Love that.

• 59:38Brian Preston?

  Everybody's gonna go check out Ben's stuff and then you're like, wow, my feed is now just covered up in his stuff. Because once you watch one, because you're gonna watch the whole video, you'll get, keep getting this stuff over and over again. And I think that's part of why he's so successful with it.

• 59:52Speaker 05

  That's not a bad thing. Well, we love that. Thank you, Ben, for the question. Thank you, everybody who submitted a question today. It's been really fun. Remember, you can continue to shape what we talk about on the show, but you only have a limited time. Um, tomorrow, our financial mutant survey closes, so go to moneyguy.com/survey to get in on that before it's too late, because we want your voice to be heard. It matters. We want to speak to your pain points. And the survey will only take a few minutes of your time. It's completely free. It's going to shape the show for the next coming year. So please do that. We are really excited about it. We love doing these episodes every year. Really a favorite annual tradition, if I say so myself.

• 1:00:31Brian Preston?

  No, we, we love this and you guys could, there's so many things going on in the world right now that you could be spending your time doing, but we do not take for granted that you give us this time. I mean, and some of you guys, I mean, that's why, go check out the Moneyverse too, cause I mean, the quality of this audience and the people. I mean, it, it blows my mind. Y'all, y'all would be shocked at some of the comments and I know the context of who these people are and are in our midst. And I'm just like, this is the right people to be hanging out with. If you want to have the right influences on your life, if you want to kind of have, cause I know it's hard. Money is a taboo subject. It's hard to talk about, but you can create a community where you can carry forward and have these conversations, make some friendships. It's fun that we get to do this with you. We don't take

• 1:01:16Brian Preston?

  it for granted. I'm your host, Brian, joined by Mr. Bo, Rebi, the rest of the content team in the wings. We're out of here. Money Guy Show, out.

• 1:01:25Speaker 05

  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.

• 1:02:01Speaker 06

  Hey, Bo's here. On your next track, listen for the decisions. Distortion on the bass, the vocal right up front. Every choice deliberate. With Bo's, you'll hear it all. Your music deserves Bo's.

• 1:02:16Speaker 07

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