Their Single Income Plan Needs Some Help | Making a Millionaire

Matt (27) and Hanna (25) have a modest income ($55,000), but are entering the hardest part of The Messy Middle. From paying off over $50,000 in student loan debt to building a net worth over $80,000, their hard work has been rewarding. As they grow their family, though, they face new financial challenges including a car purchase, health insurance concerns, and the balance between living for now and for the future. After talking through all of this, we build a financial plan for their future. ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠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. ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠DRINKAG1.com/MONEYGUY 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.

• 0:01Speaker 00

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• 0:27Speaker 01

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• 0:36Speaker 01

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• 0:56Speaker 02

  How your life looks today does not dictate how it's gonna look tomorrow. Meaning, we are gonna have seasons. There are gonna be times when life feels hectic and crazy and tight. And it's not our dream life necessarily. We often call that the messy middle. And that's exactly where you guys are.

• 1:11Speaker 03

  Exactly.

• 1:12Speaker 02

  I want you to just pause for a moment and take a deep breath and just go, okay, it's all right. Other people are here. We're not alone. Other people have navigated this.

• 1:26Speaker 02

  Who are you guys, right? How old are you? You said you have a one-year-old little boy. Give us a story. Give us the backstory. How'd you guys get to where we are today?

• 1:35Speaker 03

  Oh, yeah, we started dating in 21. We got engaged in 23, married in 23. And then we ended up having Barrett a day after our one-year anniversary. So it's like, we went out to eat.

• 1:50Speaker 04

  And what is it gonna look like as parents in this next year? And then literally the next day was go time.

• 1:56Speaker 03

  Yeah, I called him and it was actually a little scary because I'm like, I haven't felt him move. I was two weeks away from my due date.

• 2:01Speaker 02

  Okay.

• 2:01Speaker 03

  I was like, I haven't felt him move. I said, what do I do? Do we call the doctor? He's like, call the doctor. And we go in, all this stuff. And they're like, yeah, you're halfway through your labor.

• 2:08Speaker 02

  It's go time, let's go.

• 2:09Speaker 03

  So she's like, yeah, you're having a baby today.

• 2:11Speaker 02

  Oh, wow, that's awesome.

• 2:12Speaker 03

  All right, let's do this.

• 2:14Speaker 04

  How old are you now?

• 2:15Speaker 03

  I'm 25.

• 2:15Speaker 04

  25. I'm 27.

• 2:17Speaker 02

  Okay.

• 2:17Speaker 04

  Now with the children, getting in that messy middle, starting to get a little bit older and feeling like a... Are we on track, you know?

• 2:24Speaker 03

  So yeah, we're getting to that point where we kinda, we're starting to think about having the second. Cause yeah, we do like that two-year age gap. That's why I was asking. Cause it's like, we like that him and his brother are just under two and my sister and I are just over two.

• 2:36Speaker 04

  Okay.

• 2:36Speaker 03

  So it's like that two-year age gap, we think is like absolutely perfect. So we're kind of, that's, we're getting to the point where it's like, all right, let's start thinking about the next one and have the second and then, I don't know, maybe have a third.

• 2:46Speaker 04

  Even the journey getting to the first kid and before that, we definitely, like before we even met, my finances, like I grew up, my parents did the whole like Dave Ramsey thing. And whoever do the credit card, that was the big thing that they went through and went off to college. Uh, did two and a half years and racked up some debt. And then I came to the conclusion of what I was in. I was like, ah, do I want to stay with this program? What were you studying in college? I was studying computer information systems originally. I just kinda remember looking around in my classroom and seeing everything. I was like, I don't know if this is really what I want. And I knew I wanted to work with my hands, so I. Work with your hands, but not like typing? Not, but, but not typing. I thought I'd be more hands-on, like working, actually modifying stuff, but it was not that.

• 3:30Speaker 04

  Which hopefully I would have figured that out sooner, but you know, life happens.

• 3:33Brian Preston?

  How far into your education before you had that, uh, this is in for me?

• 3:37Speaker 04

  Yeah, I was two and a half years into that program.

• 3:39Brian Preston?

  So were you, you were a junior?

• 3:41Speaker 04

  Yeah.

• 3:42Brian Preston?

  Okay.

• 3:42Speaker 04

  I was a junior and then.

• 3:44Brian Preston?

  And how much student loan debt did you build up and during that period?

• 3:47Speaker 04

  It was about, all of a sudden done probably 50,000. Wow. Between.

• 3:52Brian Preston?

  I didn't see that on your net worth statement. Am I missing it?

• 3:55Speaker 04

  Maybe it wasn't 50,000. It could have been less.

• 3:57Speaker 03

  We knocked out all of our student debt.

• 3:59Speaker 04

  So being the Dave Ramsey thing, when, when I dropped, it was, it probably wasn't 50,000, probably more like 30.

• 4:04Brian Preston?

  Okay.

• 4:05Speaker 04

  Now that I'm thinking about it.

• 4:06Brian Preston?

  Okay.

• 4:06Speaker 04

  Cause I don't, I did not get out and it's been a couple of years, so I don't remember. I just knew like when I, cause I made the decision to drop out. I dropped out, moved back home and then of course it was like, all right, these loans are going to kick in. So that was weighing on me and we hadn't met yet. So I was still living at home with my parents and they said, take whatever you're going to do for rent. Try and pay that down.

• 4:26Speaker 02

  Love that.

• 4:27Speaker 04

  So, I mean, I was living for free and then just pretty much knocked that out before we met. Took me probably three, four years.

• 4:35Speaker 02

  Three or four years to knock out thirty thousand, it's impressive.

• 4:37Speaker 04

  Yeah.

• 4:38Speaker 02

  It's super impressive.

• 4:38Speaker 04

  Yeah.

• 4:39Speaker 02

  What do you do professionally now?

• 4:40Speaker 04

  I do woodworking.

• 4:41Speaker 02

  Oh.

• 4:42Speaker 04

  For a custom cabinetry shop in Michigan, so.

• 4:44Speaker 02

  That is working with your hands.

• 4:45Speaker 04

  Yes. Very different than computer information systems.

• 4:49Speaker 03

  What he makes is beautiful. He sends me pictures all the time of what he's making and like all the jobs he's doing and he does really, really good work.

• 4:55Speaker 02

  I love that.

• 4:56Speaker 03

  Got a couple of cutting boards in our house that he's made for me, too.

• 4:58Speaker 04

  Yeah.

• 4:59Speaker 02

  Awesome.

• 4:59Speaker 04

  Yeah, so when I go in here and see the studio and seeing all the stuff, I'm like, oh, this is really nice. And like, I have the eye for all that stuff.

• 5:04Speaker 02

  Did you know that me and Brian actually built most of the stuff?

• 5:07Brian Preston?

  No.

• 5:07Speaker 03

  Seriously?

• 5:08Brian Preston?

  We did, we did work with people to make custom ta- like, you can tell.

• 5:12Speaker 02

  We did not swing any hammers in the making of this set.

• 5:16Brian Preston?

  Probably nobody but you have noticed. This table is not shaped like a normal table. It's, so it was custom made.

• 5:22Speaker 04

  Yeah.

• 5:22Brian Preston?

  Our conference room tables that y'all were sitting at were custom made. Could you tell that there's a real wood when you were sitting there playing?

• 5:28Speaker 04

  Cause I do the countertop, I've done countertops at my place that we work at.

• 5:31Speaker 03

  It's like, yeah, you look at this seam right here. And I'm like, I know exactly what you're talking about.

• 5:36Speaker 02

  And you said you had student loans, too. What was your, what was your school background coming into adulthood?

• 5:40Speaker 03

  When I graduated high school, I went to the University of Toledo for a semester. And that was the four-year university. I was planning on getting my doctorate in occupational therapy.

• 5:49Speaker 02

  Okay.

• 5:49Speaker 03

  And then I got a semester and I was like, ew, I don't want to go to school for eight years. So I got.

• 5:54Speaker 04

  It's a theme with us, too.

• 5:55Speaker 03

  Yeah. So I ended up deciding to transfer to a community college and I got my associate. So I'm an occupational therapy assistant.

• 6:02Speaker 02

  Okay.

• 6:03Speaker 03

  So I went from that eight-year program down to a two-year program.

• 6:07Speaker 02

  Okay.

• 6:07Speaker 03

  So that one semester cost me as much as my two years in my associate. So I got, I don't even know the total. I was probably pushing thirty thousand, too.

• 6:16Speaker 02

  Okay.

• 6:17Speaker 03

  And once I graduated in twenty-one, I graduated in spring of twenty-one and I was like on my own, living in Toledo, away from my family. I was all on my own. I had been in my own apartment, paying rent, working and just kind of like, literally just making ends meet right there. Kind of just paying for my immediate expenses. Hadn't thought about student loans. I think at that point. Student loans were still in. Deferment maybe? Yeah, yeah, yeah, they were in. They were pushed off, so I didn't even have to worry about that. So when I met Matt, I had credit card debt, I had student loans, I had.

• 6:48Speaker 02

  How much credit card debt?

• 6:50Speaker 04

  I think, I think when, that was one of the, like, we had the talk before getting married and going through the marriage classes. And then it was, you know, after the honeymoon, we went and got back and, all right, let's sit down and look at this stuff. And then I was like, oh, we got like $6,000 on a credit card, that's not.

• 7:04Speaker 03

  Yeah, so, yeah, that's literally like.

• 7:07Speaker 04

  It was like a twenty.

• 7:08Speaker 03

  Pay all my rent and it's like, all right, do I want groceries? Yep, put it on the credit card.

• 7:11Speaker 02

  Oh, that's the way it went.

• 7:12Speaker 03

  Did I make a few couple stupid purchases? Sure did.

• 7:15Speaker 02

  Do I want groceries and some new shoes, right?

• 7:17Speaker 03

  Yeah, yeah, exactly.

• 7:18Speaker 02

  That's the way that goes.

• 7:19Speaker 03

  Yeah, that was kind of my downfall there is like, yeah, I had the, my dad is super, super smart with finances, but I didn't take that from him, unfortunately.

• 7:30Speaker 04

  It's more of he just kind of did it and you're like, okay, type of thing, right?

• 7:32Speaker 03

  Yeah, pretty much.

• 7:33Speaker 04

  Yeah.

• 7:33Speaker 03

  So I kind of wasn't financially smart in my younger years. So like, meeting Matt, he definitely took charge of the whole financial situation. He's like, all right, you have a 30% interest on your credit card.

• 7:44Speaker 04

  We paid that off that day.

• 7:45Speaker 03

  Yeah.

• 7:46Speaker 04

  We had enough saved up.

• 7:47Speaker 02

  Well, that's what, it's wild, so you guys come together, you start dating, you meet each other, you've got $30,000 in student loans, you've got $30,000 in student loans, you've got another $6,000 in credit card debt.

• 7:56Speaker 03

  Mm-hmm.

• 7:56Speaker 02

  And you, you're just like, all right, hey, we're gonna, we're gonna attack this.

• 7:59Speaker 03

  Yeah.

• 7:59Speaker 02

  Like, how'd the conversation go between you guys about, hey, this is where our money is gonna go right now?

• 8:04Speaker 04

  It was pretty easy. I mean, for the most part, she's been very good about like, like you said, like, I don't know, so like, just teach me. And more so the trust, like, the way that we talked beforehand was if we can, you know, share a bed, we can share finances. That's part of marriage, it's all together. So that made it super easy for us of like, we're on the same page. So this isn't just your debt, my debt, this is all our debt. And even before that, like, when we were dating, cause I was in Detroit and she was in Toledo, so it was an hour drive for us to see each other. And I was driving my car at the time and it was getting to the point where it kind of took a crap. And I was needing a new car, so I ended up purchasing a Toyota Tacoma, but it wasn't with cash, that was also finance, so. We ended up with another $32,000 debt on top of that.

• 8:48Speaker 02

  Holy cow.

• 8:50Brian Preston?

  I'm, I'm missing something here because, uh, and Bo, I want you to kind of pull up the net worth and the income.

• 8:56Speaker 02

  Yeah.

• 8:56Brian Preston?

  I'm hearing all these things and, you know, and look, we come in here and I know what your income is. I've seen your net worth statement. And on paper, you guys, you look great. I mean, that's what.

• 9:08Speaker 02

  Right now, you guys have a total net worth of just under $86,000 and you have a household income right now of 55,000. So for all intents and purposes, I mean, you have more than one X your household income in terms of net worth at a pretty young age at 25 and 27.

• 9:24Brian Preston?

  I don't see enough time to have passed. I mean, cause 27, 25, y'all are young.

• 9:29Speaker 02

  Yeah.

• 9:29Brian Preston?

  And you're already over one time, your net worth is higher than your, your income is, which is your age 30 goal. I've just heard 30,000 student loan, 30,000 student loan.

• 9:39Speaker 02

  30, 60.

• 9:40Brian Preston?

  I've heard $6,000 of.

• 9:41Speaker 02

  66.

• 9:42Brian Preston?

  Of credit cards. I've heard then another $32,000 of.

• 9:46Speaker 02

  Like a hundred thousand dollars.

• 9:47Brian Preston?

  We've got a hundred thousand dollars of debt that is.

• 9:50Speaker 02

  So it's gone.

• 9:51Speaker 03

  It's gone. Yeah.

• 9:52Brian Preston?

  So what happened?

• 9:53Speaker 03

  I was working at the time, so I had a full-time job. I was making good money. Um, from, I had just started a job when we started dating. So I was working all the way up until this past June.

• 10:05Speaker 02

  Okay.

• 10:05Speaker 03

  Um, so my contract got bought out at my company and they pretty much paid me the six month severance. Um, and I was making really good money there. So we kind of took that and paid off our debts.

• 10:17Brian Preston?

  So how big was that severance?

• 10:18Speaker 04

  It was about a little over 30,000.

• 10:20Speaker 02

  Okay.

• 10:20Speaker 04

  Which, cause I guess my debt too, with the 30,000 school loans was pretty much paid off before we got married.

• 10:26Brian Preston?

  Okay.

• 10:26Speaker 04

  Cause it was those four or five years.

• 10:28Brian Preston?

  So I was living at home. You extinguish it just from living at home during that.

• 10:31Speaker 04

  Pretty much. I didn't, especially during that time was 2020.

• 10:34Brian Preston?

  Good on you.

• 10:34Speaker 04

  You couldn't go out and do stuff. So I was like, well, I might as well.

• 10:36Speaker 02

  Might as well pay off some debt.

• 10:37Speaker 04

  Pay off some debt. I can't go and do anything.

• 10:38Brian Preston?

  I'm not even gonna pick on the, the, cause normally we do this whole interest rate arbitrage thing, but if your parents told you, hey, you can live at home, not pay any rent if you pay down the debt. I'm not even gonna, behaviorally, I'm like.

• 10:49Speaker 02

  No, I'm not gonna.

• 10:50Brian Preston?

  That seems very noble, you know, cause now maybe, you know, cause if you'd go and say, I want to go fund my Roth, they'd be like, probably okay. But I just think that it's good to be focused on what you, what the goal was. And it sounded like you accomplished the mission.

• 11:02Speaker 04

  Yeah.

• 11:02Speaker 02

  What was the household income when you were both working?

• 11:05Speaker 04

  It was about double.

• 11:06Speaker 02

  About double, so about a hundred and ten thousand dollars.

• 11:09Speaker 04

  She was making a little bit more than I was, so.

• 11:11Speaker 02

  How has it?

• 11:12Speaker 04

  From six figures to cut that in half.

• 11:14Speaker 02

  Because obviously making that kind of money, you were able to do some like intense things. You were able to like knock out a bunch of debt, get that all knocked out, but then you make this decision to go down to one income. How's that been?

• 11:24Speaker 03

  It's, it has been tough, but we make, we're kind of based that off of me staying home and taking care of our son. So we're not paying for childcare. I've been a little bit more diligent on.

• 11:37Speaker 04

  Not going out to eat as much, making the meals at home, which is something we used to do quite a bit beforehand.

• 11:43Speaker 03

  Oh yeah, I go out shopping and get a fun drink here, fun drink there, and there's thirty bucks a month, if not more.

• 11:49Speaker 02

  Real easy.

• 11:49Speaker 03

  So definitely had to change our lifestyle a little bit, but making the sacrifice and being able to stay home with our son has definitely made it so worth it.

• 11:56Speaker 02

  So even though it's been hard, it's been a worthwhile hard. Is it likely that income is going to stay at the place it's at right now, or is it likely you'll go back to work?

• 12:05Speaker 03

  I would at least love to stay home until our son, if not more kids, are in school. So maybe like a five year thing. I would love to go back to work eventually, but I want to make sure our kids are taken care of. That is my number one priority. Um, I even told him like when we were kind of determining if we wanted to, if I wanted to go back to work, I said, if we don't find a safe place for our son to go, I said, I'm not working. I said, he is our number one priority, no matter what. I would love to stay home. It's, if we do kind of have our, if we have a second kid here soon, maybe five years before I go back to work.

• 12:36Speaker 02

  Okay.

• 12:36Speaker 03

  Um, so I guess one of our main goals is how can we make that possible?

• 12:41Speaker 04

  Cause for me, like even with the paying off the debt, like I had some financial backing with Dave Ramsey, but I didn't find you guys until probably, I don't know, six months, seven months ago on YouTube type of thing. And with my job, since I, I'm working forty eight, fifty hours a week. And with that, I can listen to music, listen to podcasts. So like I've gone back and I, I mean, the way I like to say it is I've gotten a second education over the last seven years between different podcast interests that I have. And I mean, Going through, I'm like, oh, like even with the 30,000 on the severance, I'm like, why did we pay off? The low interest debt? We could have, I just, you don't know what you don't know.

• 13:19Speaker 02

  You didn't know any better, that's right.

• 13:20Speaker 04

  And after that, now sitting down and crunching these numbers, I'm like, oh, man, it feels like we're really squeezing and like, unless I'm missing something, but I like, I know we're in a good spot. I know we've, we're building up our emergency fund, we're doing all the steps to get through, but it feels if we were to add another kid into the mix and move on with just life, like how much are we actually enjoying our life versus like squeezing too much out of it?

• 13:42Speaker 02

  Well, to answer that question for us right now, how much are you enjoying life or do you feel like right now in this moment, you are just surviving?

• 13:50Speaker 04

  I myself feel more of the just surviving, like we do have our moments and I, I grew up not having a lot anyways with my family. We're a pretty middle income family, so I learned to make the fun memories out of the stuff. So I'm, I know what to expect and I just, it's hard for me because I'm very family oriented. Like when we got married in our vows, I was like, the one thing I know is I'm not always career driven. Like I've never had that thing that I knew I really want to do, but I wanted a family.

• 14:16Speaker 02

  Right, yeah.

• 14:17Speaker 04

  With that, it's tough when I come home and after working 10 plus hour a day and then only get to see him because he's got to go to bed early, being young for a couple of hours, like two hours, maybe if we're lucky if he's up. So that's, you know, because I've tried to make up what we've lost by working the extra overtime, time and a half and all that. To me, I'm like, how much enjoyment am I getting if I'm not being with them as much?

• 14:40Brian Preston?

  I do want to, I want to make sure I understand, when you say survive, because you say you're family oriented and in a minute we'll bring up what your budget is. Do you feel like you're, you're only surviving because you also know what you should be saving and other things? You sound like you've loaded yourself up, but if, if we actually boil it down to just the life that you're living, like you come home and you sleep on the weekends and you think about, you look at your life around the holidays, do you feel like there's anything you're missing from of not, not savings goals? Like the 25% or anything, but just from your family, family nucleus? Is there like memories or things that you're missing or do you feel like you're sustaining and, and living a good life right now? I think that's really what Bo is asking.

• 15:19Speaker 04

  Yeah, okay.

• 15:21Speaker 03

  At the end of the day, I do love where we're at. I do feel like we're in a good spot and I don't feel like we're missing too much. Like he said, at the end of the day, as long as I'm home with him and Barrett, that's all, that's all that it matters. But do we want to go out and be able to take like many, like little trips here and there? Do we want to be able to buy a house because we're renting right now? So it's, I guess we're kind of looking more into the future at that stuff too.

• 15:44Speaker 04

  Yeah, that's probably my biggest downfall. I know like we've jokingly talked about and seeing the future, the life that we want to have for our son and for our family. For me, I think it's probably harder. Like, yes, we are doing good. And I think it's more of just a reminder to myself that I need to like take a second, like live in the moment and it's for a couple of years. And because in my head, I thought she was saying she originally when she's like, yeah, I don't think I want to go back to work. I'm like forever.

• 16:09Speaker 04

  Which if I was able to do that, I'd love for her to be able to do that. But like I said, with the things in the future, the house and trying to do those things, I need to realize like we are, we are good where we're at. And I do get to do the things, like especially him being one, he's young. He's not going to know if we don't go on a vacation for a week long thing at this point. Like we can suffer through. And like, we grew up tent camping. So like for me, that's pretty cheap and easy and he can still do that. And I think it's probably more of the reminder for myself to it's okay for this time in our lives.

• 16:40Speaker 02

  I want to hit on some of your goals. She said, one of the things is how can we make that possible? You just said something so great and we say this on the show all the time. How your journey starts does not define how it ends, right? That's the thing we say. But another thing, we don't say this as often, but it's in that same vein is how your life looks today does not dictate how it's going to look tomorrow. Meaning we are going to have seasons. There are going to be times when life feels hectic and crazy and tight and it's not our dream life necessarily. We often call that the messy middle and that's exactly where you guys are. So I want you to just pause for a moment and take a deep breath and just go. Okay, it's alright. Other people are here. We're not alone. Other people have navigated this. And then I want us to calibrate, okay, what are your goals?

• 17:24Speaker 02

  Because I heard, I want you to list them for us, but I heard like, we're renting, we want to buy a home, want to have more kids. Walk us through some of like, the goals, both personally and then financially that you guys have.

• 17:36Brian Preston?

  And give us a priority list on that, too. Because I heard from your heart, it sounds like staying at home for the next five years is, that's probably, is that one? Is that number one?

• 17:43Speaker 03

  That is probably number one.

• 17:45Speaker 04

  And having another kid.

• 17:47Speaker 03

  Having another kid, definitely, because yeah, we're getting close to that two-year age gap that we really like. And with that, getting me a new car. And with that being kind of like our family car, like, yeah, he got his Tacoma, but that's not necessarily big enough for what we want.

• 18:02Speaker 04

  It barely fits with the one car seat. And like, she's like up in the dashboard and it's not as big a room. When I got it, it was just me. And even with her car, like, starting to have some starter issues.

• 18:12Speaker 03

  And starting hard because it's cold out now.

• 18:13Speaker 04

  And I want to make sure that they're not driving something where it's not reliable and something that will, you know, help us grow our family, too.

• 18:21Speaker 02

  Yeah, help me, give me an idea of what does a family car mean for you guys?

• 18:24Speaker 03

  We would like a bigger SUV, which we know those are.

• 18:27Speaker 04

  Or like a minivan, really anything family oriented.

• 18:30Brian Preston?

  Do you sign off on the minivan?

• 18:33Speaker 03

  The newer ones with the built-in vacuum, those would be super nice. Yeah, something with more room, because it's like when we travel down to Ohio to go see my family, we obviously, we take his truck. We're packing, we're packing to the brim.

• 18:45Speaker 04

  Yeah.

• 18:45Speaker 03

  So it's like something we can do a little bit of traveling with and be comfortable. Fit that second car seat. So it's like, we don't know if we should buy new, buy used. How much can like we afford in that sense? I know at this point, we are going to have to finance a car, but we would like a bigger SUV to fit the lifestyle that we want to have. And if we're going to invest in a newer car, it's going to be something we exactly want. Like, we're not gonna get something we kind of want if we're going to put the money into it now.

• 19:12Brian Preston?

  If it was just a, okay, though, I'll just, so you can put a visual, if it was like a Chrysler Pacifica minivan. See, that's why I asked the question. That's why, because look, I'm just gonna, I'm just gonna straight up tell you, you guys, because Bo and I are gonna do the same thing. We're trying to build this vision of what y'all are trying to accomplish, but there's a push-pull system that's going on.

• 19:36Speaker 03

  Yeah.

• 19:36Brian Preston?

  And when you have big goals, like, I want to stay at home at five, for the next five years, and we already know your earning potential is just as much as Matt's.

• 19:46Speaker 03

  It is.

• 19:46Brian Preston?

  That's a big ask.

• 19:47Speaker 02

  Yeah.

• 19:48Brian Preston?

  And it, but it's very important, and we're perfectly fine with the big ask, because I think life-wise, this is something that's very worthwhile, but there's going to be a sacrifice.

• 19:57Speaker 02

  There's trade-offs.

• 19:57Brian Preston?

  If you make this, you have to go into it knowing, to get everything we want, I'm gonna have to give up something.

• 20:04Speaker 02

  Yeah.

• 20:05Brian Preston?

  And so, vacuum cleaner isn't even showing up anywhere on the radar.

• 20:09Speaker 03

  Yeah.

• 20:10Brian Preston?

  And then, that's what, that's what I'm trying to understand, is like, the attachment to the SUV. Look, I have one of, this is in my household too, and we, we've had lots of conversations now. I think you've heard us talk about how Bo got the third child. Part of that was a minivan in the negotiation.

• 20:25Speaker 02

  That's the way it is.

• 20:26Brian Preston?

  You know, and I, I just saw her yesterday. I saw Bo's wife yesterday. We were out walking to go to lunch together, and his wife-

• 20:31Speaker 02

  She plays chess, I play checkers.

• 20:33Brian Preston?

  Runs by with all the kids loaded up, and, you know, and she's like, Brian, please help me get out of this minivan. And I'm like, I'm not, I'm not the one you need to be talking to on this. Do you see why I'm trying to get context?

• 20:44Speaker 03

  Absolutely.

• 20:44Brian Preston?

  Because you're giving me mixed signals, in some ways, Hannah, because I was very impressed, my first impression of you is you're like, okay, we met this year. You start, you gave me the list, very, in a very analytical type way, and I was like, okay, I've got a calculator brain here, who probably can see how you move parts on the table. And I was even gonna ask you guys, who's the financial personality of this household? Because the way you were laying out logical stuff, I was like, I was immediately drawn to you as being the financial person. And then to hear, I want an SUV, you know, and it felt disconnected from the analytical side. It seemed more emotional. Is that true?

• 21:23Speaker 03

  Yes. And I would say, yeah, definitely. I, I make the impulse buys. It's like, I want this. I get my mindset on something, I'm gonna get it. I'm gonna get it now, not tomorrow, today.

• 21:32Brian Preston?

  So where are you in your journey, though, from being, because if you're analytical, and now you're the financial person of mine, but you were the person, you got credit card debt?

• 21:40Speaker 03

  Yes.

• 21:40Brian Preston?

  Where are you at in this journey on, on transformation from being a financial mutant versus somebody who's just general public?

• 21:48Speaker 04

  Probably like three, four months ago when I like for me, I'm pretty, she's very analytical and so am I. And getting into this and when I, like I said, when we went down to the one income, my whole thing before was like, as long as we have this amount in our checkings and we don't go below that and I see it grow and then we can move money around there, we're good. And then it'd been a month, I'm like, okay, maybe we just spent more this month. And it just kind of stayed and then slowly went down a little bit. I'm like, okay, so I need to really dive into what's going in here. And when I did that, I was like, okay, like she said, the fun drinks, going out to eat, the making those purchases and had to have the tough conversation of, do you see what's going on? And like, it wasn't, it definitely wasn't an easy conversation.

• 22:28Brian Preston?

  So which is more important to you, Hannah? The lifestyle stuff? Cause that's also family stuff is going out to eat once or twice, you know, and doing little mini trips, even if it's camping. Is that more important or is the SUV?

• 22:40Speaker 03

  I think probably the lifestyle.

• 22:41Brian Preston?

  So we can bring you back and do you have resentment from that though? Or is that something that is this something, if you made this, this decision, you would be okay with it?

• 22:49Speaker 03

  I would be okay with it. I need to get that in my mind though. That's the thing. Needing a new car is pretty important.

• 22:56Speaker 02

  First time you've said need. So I love that. Cause you just said, hey, I really want a big SUV. I really want, and what I was going to draw you back to is there is a delineation between wants and needs. Cause I would argue if you guys have a car that will not start in winter time and a Tacoma, you guys, if you're going to be a family of four, five, even you need a larger automobile. Is having a big SUV the need? Perhaps not. Perhaps that's why. So now I think really diving into, okay, what's the bare minimum that we need? And then we're in a second, we'll sort of triage back into what can we afford. But I think that's beautiful that you recognize that. Hey, we do need a bigger car.

• 23:33Speaker 03

  We do.

• 23:33Speaker 02

  And I think we would all agree.

• 23:34Brian Preston?

  I think she subconsciously just did that. That's why it's great.

• 23:38Speaker 03

  I also feel like we're at a point where we've, we've talked about this so many times. It's like, we have so many different variables that we could take the path to. It's just making that first decision of, okay, do we want this lifestyle? Then we can't have this. Do we need the car? Then we can't do this. So it's, we're, we're stuck in so many different variables that we just need to take the first step of like, okay, we're going to do this and this is going to be the stuff we're going to have to sacrifice because of it.

• 24:02Brian Preston?

  Do y'all ever fight over that stuff? Or is that y'all kind of a united front? Cause that's super powerful if y'all are united about it.

• 24:09Speaker 04

  I mean, I wouldn't say really fight. Like obviously we both have our feelings towards everything, but we're really. Honestly, pretty good at trying to communicate like since we started dating. Like I'm coming from the mindset of have those tough conversations and then when we like the way we looked at it is it's not her and I versus each other, it's her and I versus what's the problem?

• 24:30Speaker 03

  Hmm.

• 24:30Speaker 04

  So we try to be united front on all that and I think having the, cause she is analytical, seeing that stuff. And when I bring it forth, it's not like, hey, we just need to do this. Let's talk through like you said of, okay, if you go back to work, this is the lifestyle we can have. You might not be home with him as much. Or do we sacrifice not getting the new SUV and not making those type of decisions? And then we have that family oriented where you get to have that one on one with him and any potential kids down the road.

• 24:58Brian Preston?

  If you don't come on this show, is there any chance that you, car doesn't crank up one morning? Cause it's cold outside and y'all go, well, let's go to the dealership and then you end up with a $1,200 car payment? And the brand is shiny SUV?

• 25:13Speaker 03

  No.

• 25:15Brian Preston?

  Cause I'm just telling you, you know, you wake up one day and then you go, cause I mean, you show up at a dealership, they'll put you in the car.

• 25:20Speaker 03

  Yeah, I'm probably the emotion there and then he's the

• 25:23Speaker 04

  The reason.

• 25:23Speaker 03

  Reason, yeah. And like, let's do this. And he goes, well, let's back up a little bit.

• 25:28Brian Preston?

  And, and a husband loving his wife. I mean, there's a lot of things you'll put yourself in just to, to try to make you happy.

• 25:34Speaker 03

  Yeah.

• 25:34Brian Preston?

  And that's why you guys, the reason I ask that is because your income, now that you're at half, you know, of what it was, it's tight. I mean, we'll, we'll go over the budget here. One, you're one car payment away from this dream that you're living where you get to make memories? Probably falling apart.

• 25:51Speaker 02

  And I want, I want to make sure we have the, all the goals, like, cause you said staying home, having another child, getting a family car. Were there other goals that you guys have in the intermediate and long term?

• 25:59Speaker 04

  Insurance for her and our son, because with her, uh, leaving her job and the severance, they also paid her insurance up until February.

• 26:11Brian Preston?

  This coming in just a few months.

• 26:13Speaker 04

  Coming in a few months.

• 26:14Brian Preston?

  Do you all have a plan yet? Do you don't have health insurance at work?

• 26:17Speaker 04

  I do.

• 26:18Brian Preston?

  Does it not have family?

• 26:19Speaker 04

  For them to add into my insurance would be almost another 600 bucks a month.

• 26:23Speaker 03

  It's not.

• 26:24Speaker 04

  And that really squeezes to the point where it's like, again, I'm trying to work this overtime to see. And I just, for me, I'm not seeing where that makes sense in that math and not really sure where to go from there.

• 26:36Brian Preston?

  You can't go without health insurance.

• 26:37Speaker 04

  Not, yeah, definitely can't go without it. And that's where I'm like.

• 26:40Speaker 03

  And I've looked into like.

• 26:42Speaker 02

  ACA Marketplace plans, that sort of thing.

• 26:44Speaker 03

  I don't understand insurance. I don't even know what that is. Like I've looked into like healthcare.gov and you just kind of put in your basic information.

• 26:52Speaker 02

  That's right. That's what I'll, yeah.

• 26:53Speaker 03

  Gotcha. That's one thing I can't figure out as an adult is insurance. That stuff is like a foreign language.

• 26:58Speaker 02

  You're also not alone in that. It's a super complicated system. So you're not alone in that.

• 27:02Speaker 03

  We've looked at like, just like the base, basic plans, uh, kind of figure out how much we can afford. So I've looked in and that's anywhere from 150 to 250, $300.

• 27:12Brian Preston?

  And that's even questionable right now because there's the subsidy is in jeopardy at the, at the moment that we're recording this show. So.

• 27:18Speaker 03

  And that's also with, I think the child tax credit and that's $300 and that's going into it.

• 27:27Speaker 04

  Yeah, that, uh, and wouldn't go without the insurance because they need that. That's like.

• 27:31Speaker 03

  It's for Barrett and I.

• 27:33Speaker 02

  And I wouldn't even say that that's so much a goal as much as that's a, that's a thing that's gonna have to happen. And we're trying to figure out where that enters in. Cause like, car's a goal, staying home is a goal, having another kid is go, all those are goals. Insurance is like, enough everywhere. This is a pretty tight deadline. We gotta have that solved.

• 27:50Speaker 03

  Yeah. I can say that's probably our first priority is finding insurance and figuring out how we can put that into the budget and how much we can afford with that.

• 27:58Speaker 02

  Got it.

• 27:58Speaker 03

  And if that definitely is going to take precedent over the car.

• 28:03Brian Preston?

  Brainstorming off the cuff. I think right now on when we're earmarking stuff, we just need to know somewhere between 200 to 600 dollars. It's probably going to need to be earmarked until we get this figured out, you know? And so as we're thinking about how much margin you'll have in your life to look at goals, two to 600 needs to be kind of just courted off to, because that's how important this is.

• 28:25Speaker 00

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• 29:19Speaker 02

  Let's talk about resources that you have available to you. Because you told us that you guys, you were so kind. You shared not only your net worth statement, but also a budget of kind of where dollars are going monthly. And it looks like your monthly budget is a little over $2,700 a month. For some context, what's the net pay that you have coming in? Like, what hits your checking account? Are you zero-based budgeting? Or is there more coming in than this $2,700?

• 29:44Speaker 04

  There's more coming in with the overtime that I'm doing. So I get paid bi-weekly. So depending on the month, you can have two, three. But when I average out, it's like, I think it was somewhere like 3,000. And I guess the way I've tried to budget, and I don't know if this is the right way, is like, if I were to only have a 40-hour work week, and then anything that's over that, because I don't always have the time for the overtime, it's just kind of gravy on top.

• 30:09Speaker 02

  So roughly 3,000 in a month, but according to this, about $2,768 out is kind of what we're looking at.

• 30:16Speaker 04

  Yeah.

• 30:17Speaker 02

  Are you guys doing any sort of saving right now? Because obviously we saw that you have like $85,000 net worth, a lot of that's in Roth, and Roth 401k. Any money currently going into savings?

• 30:30Speaker 04

  For savings out of mine, I have with my work, the 401k program. So I've just, I was for years, and the reason it is so high is because when I was at home and the day Ramsey thing was 15%, I, as soon as I was able to enroll, just set it to that and left it. And then they match, I think it was up to 5% or 4% at 5%. I forget how, it's a weird breakdown. I've now, when we did the calculations, back down to only investing 5%, which is the employer match.

• 31:00Speaker 02

  You're doing the maximum?

• 31:00Speaker 04

  That's the maximum to get the max and not over in that account. And since then, I've not really invested anything into Roth for her or I. I do have the health savings account and it's not really investing my money, but through the United Healthcare that we have, they do like a tracker thing if you walk so many steps. So it's like 20, up to a thousand bucks that you can earn in a year. So I've just been putting that into the HSA that I have.

• 31:25Speaker 02

  Is their matching formula likely if you put in five, they'll give you four?

• 31:29Speaker 04

  I think that's what it works out to, yeah. 5% they match up for.

• 31:33Speaker 02

  So right there on the cuff, just doing that, like just doing enough to get your employer match, you know, in the financial order of operations, that's step two in our world. You already got 9% going to work for you. What's great about where you guys are is that when you start early, 25 and 27, it does not take a lot to do a whole lot of heavy lifting. So it's going to be interesting to see, based on the hard work you did, when things were more comfortable, having, you know, $85,000 in net worth right now, a lot of that being in liquid assets, and just saving the 9%. Have you projected out like what that looks like by the time you get to retirement?

• 32:10Speaker 04

  Kind of, not really. I wasn't sure.

• 32:12Speaker 02

  I think it'll be mind blowing. We say 25%, 25%, and we love that, but you were doing that early on, you were saving at that clip early on, you've given yourself some flexibility that if this is, perhaps this is all you can save for the foreseeable future, until you go back to work or some circumstances change, I love seeing that. And I think you'll be amazed, the fact that you guys did figure that out at 25 and 27, how powerful that's going to be for you all over the long term.

• 32:37Speaker 03

  He is such a future planner and I love that about him. But I've needed to tell him, like, we do need to figure out what we need right now. Like, yes, it's super important to save, but we might need to back, like, I had to tell him to back that down.

• 32:48Speaker 04

  It was tough for me to go from 12:15 now to 11:00. Especially watching the show, I'm like, but do you realize what it could be?

• 32:53Brian Preston?

  Your budget, your budget doesn't look like you're wasteful. I mean, it looks, so that's, so now I need, I need to ask you a few questions on this career you have, because you make 55,000 in woodworking and you love it because you're working with your hands. What's your trajectory? I mean, do you get 2%, 3% pay raises? Or is there a chance where you're gonna make 65,000, 70,000? What's your career look like?

• 33:15Speaker 04

  Um, that's kind of up in limbo right now. They've done the last couple of years, the 3% track. I know that I've had leadership roles in there and I'd like to keep moving up in that. Cause it's a, our company's smaller family, but it's grown quite a bit. So we're now, we're like 50 employees and I've been there seven years. I know I, if I were able to make more, I would. I'd like to get something with more of a managerial.

• 33:45Brian Preston?

  Well, look, look ahead of you and, and, and behind you. What opportunities do you see? I mean, is your, do you think your boss is making good money to where he can pay his bills and stuff to?

• 33:54Speaker 04

  Yeah, yeah.

• 33:55Brian Preston?

  Cause that's what I'm, now we get to the hard stuff. Don't you agree this is the hard point where we have to say, this is off the cuff. You got three grand coming in. You got 2,700 and we're not covering health insurance. It are, we've already blown it up with health insurance and we haven't bought the new car. We haven't saved for our house. This gets really hard, really, really quick.

• 34:18Speaker 02

  Cause when it comes to changing your financial circumstances, in most scenarios, there's really only two levers you ever get to pull, right? One lever's decreasing expenses. I'm gonna spend less, I'm gonna have less flowing out. That's a lever. I don't know that you guys are wasting a ton of money. You've already kind of like done that part and the other lever then becomes, well, how do we increase income? How do we figure out how to have a bigger shovel so that we can fund some of these other things? And I think that's kind of, they're at the income piece. That's the other lever, lever, lever that you have to figure out how we can adjust.

• 34:51Speaker 03

  And I wouldn't be like opposed of even just getting like a part-time job to kind of work around like his work schedule and then try to make a little money on the side. Like, I'm not opposed to that. It's just kind of figuring out how we can do that.

• 35:04Brian Preston?

  That's the other question I was gonna ask you is because you have a very valuable skill set. I mean, because obviously, and I love the fact that you realized, I'm not gonna do this for eight years, but I could do this for two. And you immediately made yourself marketable and made a great income. I'm wondering, and look, I've used with my family and my youngest daughter, we've used occupational therapists for years. It is, and what's funny is I've seen some of them as they start growing their family, they can do some unique, it is a career that allows some uniqueness and that you could probably find a place. And I think there's such a demand and need, you could probably go backfill some hours, you know, if you had a mom's morning program. But look, I'm conflicted because I want y'all to grow

• 35:47Brian Preston?

  a family. Y'all seem like a lovely family. But, but I think that you have to, you're kind of like our Rebi in some ways, is that she's had to figure out how do you do the traditional type family stuff, but also how do you help out with the family if you have this capability? I don't know what that answer is yet, but I think that that's probably a smart path to kind of think, can you, because if we get to the point that Matt says, I'm giving it all I got. I mean, what's woodworking in general, what's the career trajectory? I mean, is this a six-figure type career?

• 36:21Speaker 04

  I think if you go on your own and do something like that, and it could be, I don't know if you'll ever do six figures just in a shop, honestly. And the only thing is, is because it is so tight already, like, I've mentioned to her before of like, hey, it would be kind of nice to maybe try doing this on my own. But I know

• 36:43Brian Preston?

  But that's a whole nother journey.

• 36:44Speaker 04

  And that's a whole nother journey. And that's why I've

• 36:45Brian Preston?

  That's like three years.

• 36:46Speaker 04

  I've pushed that off and off. Because, yeah, it's, it's three years journey. And right now, we just, that'd be way too scary to not know because it's like

• 36:55Speaker 03

  Too risky.

• 36:56Speaker 04

  Too risky. And where I'm at, like, I got a review in February, and there's an opening for leadership roles. So maybe a little more, but I don't ever see six figures at something like that.

• 37:06Speaker 02

  But those leadership roles would create an increase in income.

• 37:09Speaker 04

  Hopefully. Yeah, it would hopefully.

• 37:12Speaker 02

  Because what I'm thinking is, obviously, we know there are some goals that you have, right? Specifically, short-term goals around, you have to have this insurance in place. You really want to need a new car, a car to be more appropriate for the family. I'm thinking the work that Brian and I are gonna have to do is we're gonna have to figure it, okay, based on the way that you guys are spending money now and the things we know that you have upcoming, if we can't cut expenses anymore, how much more income do we need?

• 37:39Speaker 03

  That's would be a really big help to kind of point us into the direction of what I need to do and what needs to happen in the future to make these goals possible.

• 37:49Speaker 02

  Awesome.

• 37:50Speaker 03

  And that's, I think that's kind of the, one of the answers we're really looking for.

• 37:53Speaker 02

  And it may be something where, okay, hey, if you just, at your job, if you get a $10,000 raise or a $5,000 raise, it makes some, or hey, if you could work part-time and make $15,000, I don't know what the answer's gonna be. We'll need to kind of like crunch through the numbers.

• 38:07Speaker 04

  Right.

• 38:07Speaker 02

  What I'm hearing is you guys are both, you both recognize and are open to the fact that's probably gonna be where the solution lies. How do we create more income for the family?

• 38:16Speaker 04

  Definitely.

• 38:17Speaker 02

  Love that.

• 38:17Speaker 03

  Yeah, and I was kind of caregiving on the side too, but that kind of, some of their family situations happened and I'm not doing that, so that was a little bit of extra money and that did help, but that's kind of not in the cards right now.

• 38:29Speaker 02

  Was that something you were able to do with Barrett?

• 38:30Speaker 03

  Yes, yeah.

• 38:31Brian Preston?

  See, that's creative.

• 38:32Speaker 04

  That was pretty nice to have that where he could go along with her.

• 38:36Speaker 02

  Are there other families, are there other opportunities in the area in which you live where potentially that could be an option?

• 38:42Speaker 03

  Probably, I would just have to look for it, but that's kind of, I don't really know how to look for it in that sense. It was a family friend, kind of the opportunity arose.

• 38:50Speaker 04

  Yeah, it was a friend of a friend that needed some help type of a thing. So it just kind of fell under her lap, but like, cool, we needed some extra, you know, side income anyway, so.

• 38:57Brian Preston?

  We can do some math, number crunching and figure out, hey, what do we need to get them on healthcare at this? What if, what's a reasonable amount on a car payment we can get them? And now you know, hey, we need to go find an extra 12 to 1500 dollars a month. How are we gonna get, make this happen?

• 39:13Speaker 02

  Is there a scenario in which you could be a one-car family? And it's okay if the answer is no. I don't want to put that on you, but I'm just, as we're going to think about some creative solutions, because one of the things I'm about to ask is, how much is your car worth and how much is it to come? They're both paid for outright, but what's the current market value of each of those automobiles?

• 39:32Speaker 04

  I think mine's just under 30,000, 29, 30, somewhere around there.

• 39:37Speaker 03

  Mine, it's a 2012 with 220,000 miles on it, so not really worth nothing.

• 39:43Speaker 04

  Yeah, that one's just, it's the drive till the wheels fall off.

• 39:46Speaker 03

  Pretty much. And I don't really drive it on a daily either. It's like if I'm home with Barrett, we would run to the store. We need to go pick up this, that, and the other thing. It's like, we don't really necessarily need two cars. It's super nice to have two. If it was something like, hey, I need to get up with him at 6:00 in the morning and drop him off at work just so we have a vehicle just in case, I would add more miles on it, but.

• 40:10Speaker 02

  Is your vehicle mostly for commuting to and from work?

• 40:14Speaker 04

  To and from work, going down to Ohio to see her parents. I mean, we pretty much drive that when we're not.

• 40:22Brian Preston?

  How far, how far is your job?

• 40:24Speaker 04

  My job's a 15 minute drive, so it's not much.

• 40:27Speaker 02

  Because I want to just introduce my line of thinking here, right? You have a need for a automobile that can be the support for the family. But right now, the nicest automobile in your home, the one that's, that's taking up the most wealth for you, is your truck, which is kind of like a commuter vehicle, right? One of the things I just, again, I'm just trying to figure out what ideas you guys are open to. If we were determined, hey, honestly, it doesn't make sense for the nicest car to be the truck, the nicest car ought to be the family automobile. Is there a solution where we use these two vehicles that you have to get that nicer family car, and we figure out some sort of commuter solution for you to and from work? Is that a viable?

• 41:08Brian Preston?

  Here, let me put it this way. What if there was a reliable, not super expensive, but reliable, like minivan sitting at the house, and then you drove a beater? To work every day that would get you to and from work.

• 41:21Speaker 02

  Painting it a little bit.

• 41:22Brian Preston?

  No, but this is, this is the reality. Let's be honest here. This is, I know what you're building. But that's what, that's what we're building. If we were trying to, cause you, you have something valuable there. You have a $30,000 equity vehicle. Look, Tecumseh is a great vehicles. I hate taking that away from you. But we gotta get really creative. Just like we took away the SUV over here. We've got to get honest and say, we're gonna need some sacrifice on your side too, just to, to make this all work. Cause a carpet, we gotta get you health insurance. And I don't see a car payment. I don't, I'm like, how the heck are we gonna do this? It's gonna be tough. So it's gotta be something pretty, pretty small.

• 42:01Speaker 04

  I know I have said to her before, like, hey, why don't we let me drive your car? And then I'll let you drive the truck around type of a thing because of that and drive it as a beater. So I'm not opposed to that.

• 42:12Brian Preston?

  But why does it have to say the truck?

• 42:14Speaker 04

  But it doesn't have to say the truck. I guess I've never really thought that of, hey, you know? That, that definitely is my baby.

• 42:21Brian Preston?

  I get it. I get it. Oh my gosh.

• 42:25Speaker 02

  Did you see how much he was smiling when we said no to the big SUV and now the tables have turned?

• 42:30Speaker 04

  Yeah.

• 42:31Speaker 02

  Uh, I, I don't know if that's gonna be the solution, but I just want to introduce the idea that when we're in these types of situations, we have to think really, really creatively. And we have to think outside the box when there are things that really matter to us. Like having another child, being able to stay home. Those are wonderful, amazing noble things. But there often are trade-offs and sacrifices that seem intense. But again, uh, the way that your financial life and the way your life looks today does not dictate how it must look tomorrow. So this may be something that this is gonna be the solution for this season. It does not mean this will always be the solution.

• 43:09Speaker 04

  Right. Yeah. I wouldn't be opposed to it. It definitely would hurt. Cause that was like that, that one thing younger.

• 43:14Brian Preston?

  Now you have to make, what, what's your favorite food in the world?

• 43:18Speaker 04

  Favorite food steak. Easy.

• 43:20Brian Preston?

  You're gonna come to a point in your life, and I'll just tell you it's gonna happen, that your, your child's going to get to be four, five years old and they're gonna say, daddy, I want some of your steak. And you're gonna. Cut them off. I watched, I mean, I watched, I watched Bo yesterday because like I said, we saw his, his family out. We were walk, we had picked up our taco, two tacos and they gave us like probably six chips with our two chips and salsa. And I watched Bo because this is not a lot of food. And I watched his kids, they roll up next to us because it's just coincidentally roll up. Maybe it wasn't coincidence, maybe she's playing chess and we're playing checkers. They rolled over and every one of the kids like daddy, can I have some chips? Can I have some chips? And I, I watched him give those chips gladly to the kids.

• 44:04Brian Preston?

  So I, I'm telling you, you're probably that Tacoma as much love as you have for it. When you see your family in that safe vehicle, you're not going to care about Tacoma. As, as, as I feel that from just from, from what you've already shared with us, I think it's going to be A okay.

• 44:20Speaker 04

  Yeah. Yeah. I think that's definitely an idea of never, I don't know why I haven't thought that, but yeah, it has more trade in power. And then getting a better payment for something if needed for sure.

• 44:31Brian Preston?

  Well, y'all got to get through, because look, I want y'all to not put the family planning on a shelf, but we've got to look at this five to six year period where you're going to not, and eventually you'll be able to go full horsepower, make 55, $60,000 a year. But, but it's, it is very valuable as for y'all's family unit. This is what you've put as a priority. Let's look at this five to six year period where we're not having to give up all of our future. But we have to be really smart with every resource that you have because there's nothing that can be left sitting out there. Not, not utilized.

• 45:04Speaker 02

  Right. Well, I think we've got our marching orders. All we ask for you guys is to be open to the creativity. And I bet we're going to find a way that we're going to do all of these things and end up in the place that you guys want to be for that great, big, beautiful tomorrow.

• 45:18Speaker 04

  Yeah.

• 45:19Speaker 02

  Absolutely. You guys are wonderful. Thanks so much. Thank you. Thank you for having us on. Brent, I love talking to Matt and Hannah because I feel like they are a wonderful proxy for what a lot of young people are feeling right now. They have goals of starting a family and doing some important life stuff. But man, things are tight and they just don't know the best way to figure out how to make it off end.

• 45:39Brian Preston?

  They are literally in the messy middle. Think about. Twenty-five, twenty-seven, having a child. Now, here's the good news. They're definitely short on time. They're short on money. While they were both working, they crushed.

• 45:50Speaker 02

  They did.

• 45:50Brian Preston?

  They had a lot of money that they saved up and they were very disciplined. I think they're gonna start seeing that some of these hard decisions they have to make with the health insurance, with the vehicles they drive, it's going to be made better because they had discipline at the early part of their marriage.

• 46:04Speaker 02

  And it's not just they had discipline early on. They even have discipline now. When you look at their original budget, it was pretty reasonable. They weren't living extravagantly. They weren't living beyond. They just literally have some obligations coming their way that they aren't gonna be able to meet, but it's not because they're wasting money. They're spending about twenty-eight-hundred dollars a month. And so we said, okay, we know we got this car thing we gotta figure out. We know we got this insurance thing we gotta figure out. And then you also wanna live life and get to enjoy the here and now. So we said, okay, what if we began reverse engineering some of this stuff? How would this look if we began trying to do some problem solving? And in my opinion, the very first problem they had to solve, like is like, pronto has to solve, is the health insurance issue.

• 46:44Brian Preston?

  This couldn't be optional. Now, we know that he had insurance covered through his employer, but you can't have your wife and child just hanging out out there. There's just too much risk. There's too many things that could go wrong. I thought it was interesting is that they've done so good. I would have loved to get a guest on here that we could yell at them for how undisciplined they were, but they were just so good with their money. But there were several eye-opening things that I saw. And the health insurance is something, because I got the feeling that they knew it was important, but I think we opened their eyes a little bit more. This is a no-stopper. You can't, you can't pass go without getting this done. Another one is, I can't wait till when you and I can kinda talk about this car and the vehicle situation, too.

• 47:23Speaker 02

  Yeah. Before we get to the car, though, let's talk about, we did some research for them. We did a little bit of work. We actually went out on the healthcare marketplace, looking at what coverages would be available. And we said that if they did a silver plan, because Matt is on his current insurance, but if they just put their son and Hannah on an ACA silver-rated plan in their area, it'd be about three-hundred-and-thirty-five dollars a month. So again, we're reverse engineering where their budget needs to be. We would need to add about three-hundred-and-thirty-five dollars a month for health insurance.

• 47:51Brian Preston?

  If if we Matt just added them and created a family plan, wasn't it around $600 a month?

• 47:56Speaker 02

  Six hundred a month, so twice as expensive.

• 47:57Brian Preston?

  Creating well over $200 margin or differential already.

• 48:01Speaker 02

  And look, this isn't, this isn't a cost they're going to want to bear, but it's an asset. They have to have it in there. So, all right, that's problem number one. They got to get at least enough more, at least more income to be able to satisfy health interest. But then they did have the car issue and it was so interesting because man, he was, oh, we're going to drive a minivan with the big SUV. And he was all on board until we uncovered the Tacoma.

• 48:23Brian Preston?

  Yeah.

• 48:24Speaker 02

  Then we found out, oh, wow, we have this vehicle that has a lot of equity sitting inside of it.

• 48:30Brian Preston?

  Didn't you see? I mean, even, even me and my wife, I mean, we all feel like it's just human nature. We all look at ourselves and we think that we're doing the things the right. And so when Hannah was saying she wanted to drive an SUV and we were picking on Hannah about that, Matt was sitting over there going, yeah, yeah, I'm with you. But then he looked like a deer in headlights when all of a sudden we're like, wait a minute. You mean, your wife's car is not very reliable and you're driving, what did he say his commute was? It was less than 15 minutes?

• 48:58Speaker 02

  Something quick, yeah.

• 48:58Brian Preston?

  And you're sitting on this Tacoma that's got all this equity and like, wait a minute, there has got to be a better way to do this. And I could tell he was like, uh oh, and I, I look in the most loving way possible. I think he quickly realized there's probably going to be a change coming for the Tacoma.

• 49:14Speaker 02

  And look, this is not a recommendation we love making, but when we're in tight times, sometimes we have to make difficult decisions. And that's exactly what we came up with. We said that, okay, if Matt were to sell his truck right now and he were to make $30,000 just cashing on the equity. We actually found that there are some reasonable cars in their area that he could buy for $10,000. Now, it's not going to be the Tacoma. It's going to be a truck.

• 49:39Brian Preston?

  It's going to be a beater.

• 49:40Speaker 02

  It'll be, it'll be a beater that allows him to get from point A to point B.

• 49:43Brian Preston?

  We'll call it a commuter beater.

• 49:44Speaker 02

  It'll be a commuter vehicle.

• 49:45Brian Preston?

  Commuter beater.

• 49:46Speaker 02

  What matters for them more was not him necessarily being able to commute, but it was for Hannah and their son to be safe. For them to be in reliable transportation. So we're going to take 10,000 of that and get him a commuter vehicle, which leaves $20,000 left over for her. And we said, okay, if we have $20,000 for a down payment and based on where their income is, if they want to fall inside 238, we determined that they could afford a car that's worth about $32,500.

• 50:13Brian Preston?

  Okay, okay.

• 50:13Speaker 02

  So then we went and did some research and we said, okay, well, based on this, what cars might be available? Brian, look at those minivans. Look at that.

• 50:22Brian Preston?

  It is interesting because I thought it was interesting. 2024, that's pretty new. Chrysler Pacifica did have 60,000 miles on it, but it's right around 25,000. Now you said 32,000, so we're already going under. That might even cut down the car payment right there. And then of course Toyota Sienna, you know, when people think of, they're thinking the Odyssey for Honda, you're thinking of the Toyota. So we're even putting her in marquee stuff here. 2021, so it's a little bit older, but only 50,000 miles. There is going to be something that they can find in their marketplace that probably fits this need so that every morning when Hannah goes out to crank up that car.

• 50:57Speaker 02

  She knows it's gonna crank.

• 50:58Brian Preston?

  Matt can feel and have peace of mind knowing his wife and child are going to be in safe, reliable transportation.

• 51:04Speaker 02

  So again, if we're thinking about building this budget, we've already added in some money for the ACA health plan at 335. Based on 238, we believe they can afford a car payment of about $400. Okay, so now we're up to $735 to have to increase, but we didn't want to stop there.

• 51:18Brian Preston?

  One of the things when they were talking about what's important to them, going out to eat, just having a little margin in the system to create memories, to have fun, because they even said they can go camping. They don't need anything exotic for vacations, but I hate to cut them so lean that they can't at least just go out and make some memories by going out as a couple, going out as a family and eating out from time to time.

• 51:39Speaker 02

  So what we said is, hey, let's add in a little fun money, little wiggle room budget of $200 a month. Well, if we add that, what you can see is we take their monthly budget from $2768 to about $3,700 a month. That's the number. Their budgetary number they need to hit is about 735. So they got to figure out how do they cover a extra $1,000 a month or so. Well, what's great is Hannah has this skill set where she's going to be highly sought after. She's going to be very marketable. There are ways she could potentially go get a part-time job, or maybe even Matt could figure out how do I make a career shift, or how do I move to a different company? Because they don't need a ton more. If they could just increase their income by $15,000 a year, I think it would change their entire living circumstance.

• 52:23Brian Preston?

  Well, $1,200 a month difference, because that's what we're talking about. That just might be an uncomfortable conversation for Matt at work. Be Hannah, like you said, part time work. This is all doable. This is not catastrophic or you have to go change careers. You have to move to a different part of the country. These are all doable things. You just have to take action and start making these things, letting them happen.

• 52:43Speaker 02

  They laid out for us some, I'm gonna say some problems they had. Health insurance was a problem. The automobiles were a problem and not being able to have any fun money was a problem. I want to emphasize though, one of the things they have on their side is one of the most important ingredients when it comes to wealth creation. They have time on their side and we just think it's worth noting, we want you guys to know that just based on what they're currently doing, he was putting 5% in his 401k, getting a 4% match. And they had been saving really, really well up until this point. If all they did was continue on their current trajectory, not increasing their income, not increasing their savings. They already had about $70,000 saved up. Well, just saving that 9% into the future,

• 53:26Speaker 02

  not factoring in pay raises, not changing any of those numbers. They are well on their way to having a $4 million portfolio by they retire, by the time they retire. So they're already in a fantastic circumstance because they did a lot of hard work really, really early on.

• 53:40Brian Preston?

  Yeah, that's what's so hard is because we were, here we are talking about in their current situation because their budget was so lean. How do we save them on this with career and stuff? But kudos to them that they had so much already saved that it is going to help them out. If they came to us with zero, this is a completely different conversation. But because they were so good at the front end of their marriage, it's created a lot of really cool opportunities.

• 54:03Speaker 02

  All right. So here's their homework items. These are the next steps for them. I think they gotta figure out an insurance plan. They gotta figure out how do we make sure that we cover that risk? And I think this is a high priority. Next, they gotta figure out what to do about the car situation. We laid out an example, a scenario, potentially sell the Tacoma, get a commuter car, get into a reasonable 238, safe family car. And I think they can afford up to a $400 a month payment. They don't, they don't have to have $400. It could be 250, it could be 300, but that's kind of where the guardrail is. And then number three, and this is probably the most important part is how can we increase the lever of income? Comes to financial decision, we have two lovers. We can either decrease expenses. They can't decrease expenses anymore. So have to figure out how can we increase income?

• 54:47Brian Preston?

  Yeah, but that's not going to be that bad because we have several things that can happen is that we've already covered, you know, Hannah's got options, but then Matt can go have some conversations with his current employer since he likes his job. This is doable, and I think this is one that I think if you look at this, when they get this, they're gonna be like, yeah, we can do this. And hopefully they feel like a united front and there's nothing but just wins and excitement and memories that they're going to make off of this plan that we've built for them.

• 55:13Speaker 02

  And Matt and Hannah, you guys were absolutely wonderful. If you out there would like to be a guest on Making a Millionaire, you can go to moneyguy.com/apply. Or if you want to play with any of our resources or calculators, you can go to moneyguy.com/resources.

• 55:25Brian Preston?

  Well, and I want to give a compliment to Matt and Hannah. Y'all crushed it and we're so proud of you and we just can't wait to see your success. So keep in touch. Guys, I'm your host, Brian Preston, joined by Mr. Bo Hanson. Money Guy team, out.

• 55:41Speaker 02

  Making a Millionaire is hosted by Brian Preston and Bo Hanson. Brian and Bo are partners at 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.

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