Buy Now Pay Later: The Data Revealed

How many Americans are actually using Buy Now, Pay Later (BNPL) services? And how much is it helping or hurting them financially? Financial Advisors, Brian Preston and Bo Hanson, ⁠⁠⁠⁠break down recent data on BNPL usage, and discuss their concern with the rising trend. Then stick around, we talk about what's on your mind with a Q&A segment directly from YOU! This episode features questions on when it's ok to lease a car, when to hire a financial advisor, what to expect as an employee if your company goes public, and so much more. Jump start your journey with our FREE financial resources⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Reach your goals faster with our products⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Take the relationship to the next level: become a client⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Subscribe on YouTube for early access and go beyond the podcast⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Connect with us on social media for more content⁠⁠⁠⁠⁠⁠⁠ Bring confidence to your wealth building with simplified strategies from The Money Guy. Learn how to apply financial tactics that go beyond common sense and help you reach your money goals faster. Make your assets do the heavy lifting so you can quit worrying and start living a more fulfilled life. Learn more about your ad choices. Visit megaphone.fm/adchoices

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

• 0:00Speaker 00

  This episode is brought to you by Indeed. You're ready to level up your business, but the pressure to find the right person to make that happen is intense. Indeed sponsored jobs can help carry the load. It boosts your job post to help it reach quality talent fast. Cut through the chaos with Indeed sponsored jobs. Get a $75 sponsored job credit at indeed.com/podcast. Terms and conditions apply. Hiring now? Then this is a job for Indeed sponsored jobs.

• 0:31Speaker 01

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• 1:06Brian Preston?

  This financial crutch can lead to devastation.

• 1:10Speaker 03

  And I am so excited to talk about this because I think it is something that the world needs to hear right now. Because, you know, in our world, in the world of personal finance, there are all sorts of tools. And some of those tools are incredibly valuable and incredibly helpful. You know, one would be like a mortgage. A lot of people can't go pay for their house outright in cash. So they end up taking out a mortgage and borrowing money to do that. That's great. That's noble. That's a tool that can be used, can be used correctly. But there's another, and I'm going to use "tool" in air quotes. There's another tool right now that a lot of people are using that I don't think is beneficial for them or for society as a whole.

• 1:54Brian Preston?

  Hey, listen, when we talk about sometimes there are things that make me feel like the system is designed to try to keep you poor. It does bother me when all the innovation that's going on in banking and consumption seems to be making it easier for you to waste money on stuff. Not, not unnecessarily on saving or building wealth. It's on how do we get more of your hard earned money into consumption? And if you didn't know, we're talking about buy now, pay later. But look, a lot of you right now, you breathe out, you're like, I don't struggle with that because I can see where the trap is, even though they put pine straw on it. I see the trap right there. You're right, you probably as a financial mutant do see this trap.

• 2:36Brian Preston?

  But your friends, your family members, your peers, when we share some of these stats. So I beg of you, please pay attention, lean in, write notes, because you might be the lifeline that keeps your friends and family safe from this trap that they don't see the pine straw like you do.

• 2:53Speaker 03

  Yeah, and if you've, if you've been living on a rock, buy now, pay later is exactly what it sounds like. You buy a good, you order a good, you check out with a good or a service. And rather than paying for it all upfront today, you get to pay for it in installments in the future. Now, it's a little bit different than credit cards and that sort of thing because supposedly interest does not accrue, so it's a different type of transaction. But what's interesting is we look at the data, this is according to Northwestern Mutual, 33% of US adults used buy now, pay later options when making large purchases in 2025. So while it may not be widespread necessarily amongst financial mutants, one in three Americans last year were using it.

• 3:36Speaker 03

  And I don't know about you, Brian, but I feel like every single time I check out on something, no matter what it is, I'm offered the option of buy now, pay later.

• 3:45Brian Preston?

  It's even worse. When I go to pay my, my credit card bill, you know, I pay it, it seems like twice a month because I'm always so, just want to make sure I don't have any interest carry costs. It never fails me that recently, specifically, I noticed that Chase is doing it for sure, is that they'll have, hey, this transaction right here. You sure you don't want to spread that payment out over a few months? And you're like, come on, guys, you know, let's get this thing paid off. Let's let it not run into any traps on the consumption side of things.

• 4:11Speaker 03

  And so I imagine what, what financial mutants are thinking in their mind is, oh, there's an arbitrage I can take advantage of. If I'm going to buy this large purchase, if I'm one of these one in three Americans doing this large purchase, then maybe buy now, pay later is a way for me to gain the system or beat the system. But if you dig into the deep, into the data a little bit deeper. 23% of US adults, so almost 1 in 4, actually use it for daily purchases. Things like groceries, things like gas, not large, one-time singular purchases. And if you're doing that, that makes me really, really, really nervous.

• 4:48Brian Preston?

  Yeah, I mean, think about it, like if you are literally turning your tank of gas into four payments or installments, you're deferring the payment on just day-to-day consumption items that's your lifestyle. And that's a, that's a big problem because remember, the secret to wealth building is you have to live on less than you make. So if you have things that are amping up your consumption, it is working against the long-term wealth building. And, and you know, the previous slide we showed was it's 33%.

• 5:16Speaker 03

  33% for large purchases.

• 5:18Brian Preston?

  But here's what's scary, I don't know how many people are like me, we're just, we've aged out and we see this for the trap that it is, because when you look at the stat that 49% of Gen Z and millennials, they will use this, are planning to use this in 2026. That is what really scares me, because if you want to know who has the world by its tail, I know despite what's out there in the financial media, it's people that have the component of time, where you're literally a billionaire of time, you can do anything if you've just point that power of time and your resources in the right direction, compounding growth will change your future self.

• 5:58Speaker 03

  What I think frustrates me is that it starts so simple, okay, I'm gonna, I'm gonna buy now, pay later, this one thing, and I'm gonna have these four payments into the future. And I'm gonna do it again, and I'm gonna do it again. So as my timeline goes further and further out, I just end up stacking these payments, stacking these payments, stacking these payments, that all of a sudden I've got 100 different payments moving in 100 different directions, not recognizing that if I were to flip the script on that, and I were to actually take advantage, if I'm a young person, if I'm a millennial, if I'm a Gen Z, take advantage of time that's on my side, rather than stacking up those future payments, I could actually take advantage of the wealth multiplier. I could recognize that, okay, instead of me spreading out this $20 purchase over the next four months.

• 6:40Speaker 03

  Months, I could take this $20 purchase buying cash today and the next month, I'm going to put some money to work. I'm going to have that operating floor. I mean, if I'm a 25 year old, every single dollar that I can deploy, every single dollar that I can put to work and not consume, has the ability to turn into $44 by the time that I retire. If I'm a millennial and I'm 35 years old, every single dollar I put to work can turn into almost $13 by the time that I retire. If all I'm doing is stacking up my future payments, I'm missing out on this wealth building opportunity.

• 7:16Brian Preston?

  Well, look, we, I feel like we already have a lot of slack in the system because we, you know, credit card use is A-OK for us. It's such a credit card debt that has the no way because we don't want to pay the crazy interest rates. But it is one of those things, I think that we all need to be aware. Buy now, pay later, a lot of research on the behavioral side of things. 85% of users are actually having a higher, you know, they're spending more than if they had just paid cash for this or, or some other structure. So just be aware that this is one of those things. If you are already struggling with some form of discipline that where you're not hitting your savings or investment rate right where you want to, I don't know that the innovation of using buy now, pay later is going to be the thing that's going to put you where you want to be.

• 8:00Speaker 03

  Yeah, this falls under the camp for me of just because I can, doesn't mean that I should. Just because I could spread this out, doesn't mean that spreading this out is what's going to be in my best interests, even the best decisions. So what are some key takeaways? What are some things that we want you to be aware of? Well, when it comes to making consumption decisions, when you're checking out, when you're spending your dollars, recognize that most of these things are not built with your best interest in mind. Most of these things are built with a profit motive and an interest in mind that if you make a poor decision, it works out better for the company that convinced you to do that. So be careful falling prey to these consumer traps. They exist for a reason and

• 8:43Speaker 03

  that reason is not unprofitable to the company that's offering.

• 8:47Brian Preston?

  And we want you to be intentional with every purchase. Look, on the day to day thing. I made the, you know, I made the example of the, if you're using buy now, pay later for a tank of gas, that's a consumption decision. We don't want you stretching that out. And for big purchases, be intentional in the fact that you can have sinking funds. There's nothing wrong that says, well, it's set up a lot of your banks, online banks specifically, will allow you to start allocating the money out and still let it be invested in a high yield savings account. You can be intentional even with the big purchases.

• 9:16Speaker 03

  And then recognize the future power of your dollars. Rather than having yourself tomorrow, pay for something you consume today. Have yourself today save for something that you can consume in the future. That's what we're all doing. When we save for the future, we let $1 turn into $88, we're making the decision, instead of me spending $1 today, I'd rather have the opportunity to spend $88 in the future. So if you can recognize how powerful that is, based on your age and your stage of life, it'll change the way that you think about consuming.

• 9:52Brian Preston?

  And you be part of the change. Be the solution for your friends and family. I know when we do content like this, that a lot of my financial mutants, this is not you, but you are still the audience, because you can still have the heart of an educator and be the guiding light for your friends and family, so they don't fall in, fall into a prey. And if you fall prey to this, and then if you need stuff to help you kind of teaching tools, or the teacher's manual, go to moneygod.com/resources. We have the wealth multiplier calculator, we got, you know, graphics attached to this, animations. It can be really motivating, so that you can, you know, not only use the education you're sharing with your friends and family, but also let them see what their army of dollars are actually worth.

• 10:34Speaker 03

  There is a better way to do money. One of the best things you can do for your dollars is subscribe right now to the channel, so that every time we put out brand new, free content, you are aware of that. And it lets us know that you're sitting out there, because we want to know where you guys are. We love showing up right here at 10am every Tuesday morning, answering your questions, loading you up. There are things that you want to get our take on, and we want to give you that take. So if you have a question right now, we have the team out in the wings, collecting your questions. We believe there's a better way to do money. So get your question in the chat right now. With that, Creative Director Rebi, I'm gonna throw it over to you.

• 11:16Speaker 00

  This episode is brought to you by Indeed. You're ready to level up your business, but the pressure to find the right person to make that happen is intense. Indeed sponsored jobs can help carry the load. It boosts your job post to help it reach quality talent fast. Cut through the chaos with Indeed sponsored jobs. Get a $75 sponsored job credit at indeed.com/podcast. Terms and conditions apply. Hiring now? Then this is a job for Indeed sponsored jobs.

• 11:45Brian Preston?

  Yeah, I think we have some questions.

• 11:47Speaker 04

  Yes?

• 11:48Brian Preston?

  Bo says the same thing every week, but it really is wings. If you think about it, like we have the wing over here and then we got the wing over here with the guys running the boards and then there in the pilot's seat, right there with the yoke in hand.

• 12:03Speaker 04

  That was very literal.

• 12:04Brian Preston?

  I mean, it's literally, I mean, cause he does, he says the wings.

• 12:07Speaker 03

  But if she's, if she's in the pilot's seat and these are the wings, that means me and you are over here in the back.

• 12:11Brian Preston?

  No, we're, no, we're in first class, first class. You kidding me? We're sitting right behind the pilot. This is the first class seats. These are lay flat seats.

• 12:19Speaker 03

  I love it.

• 12:20Speaker 04

  Interesting, interesting.

• 12:21Brian Preston?

  Can you tell I'm going on vacation after this?

• 12:24Speaker 04

  I was thinking we were talking in theater terms, you know, in the wings of the stage. That isn't actual production.

• 12:30Speaker 03

  I think that's where the actual expression comes from.

• 12:33Speaker 04

  Yeah, it's a legitimate term.

• 12:34Speaker 03

  I don't think it's an airplane expression. It may be an aviation expression.

• 12:37Brian Preston?

  I'm sure you're right, but it's okay. And my, and the way my brain works, I had a whole nother way that this is the way life works.

• 12:44Speaker 04

  Are our money guy team in the wings of an airplane or of a production show?

• 12:49Brian Preston?

  I like thinking Bo and I are in first class and you're flying the plane.

• 12:53Speaker 04

  And I'm flying the plane. I'm very honored, first of all. Okay. Moving on from that, we do have some questions queued up, so get your questions in the chat. The first one is from Ken. It says, my company just announced they are going public. We have the opportunity to participate in a founders equity day program. What are some yes and no's or things to watch out for?

• 13:14Speaker 03

  Well, so this is, this is exciting. Let me kind of explain what's going on here. Ken works for a company that's owned by some private individuals or a private entity. And they said, you know what? We now want to be traded on a public stock exchange. We want to have a stock ticker similar to the way you think about like an Apple or a Home Depot or a Google or something like that. And since Ken works for them while they're a private company, he has the option, it sounds like, where they're going to be able to buy in and participate in this initial public offering when they initially issue those shares out. And so for a lot of people, this can be an incredibly exciting thing. And a lot of folks have become very, very wealthy by having founder shares pre-IPO for a publicly traded company.

• 13:58Speaker 03

  But I do love that Ken's asked the question, hey, what are some things I should think about? What are some things that I should be aware of? And how can I decide and figure out, does this actually make sense for me and my family?

• 14:09Brian Preston?

  Well, there's a few things. All right, I'll say the two quick things that popped in my mind. Well, I have a bunch of things. I'll go through these two. You know, a lot of times with your, when you're having IPO from the company and they're offering you this opportunity, you need to know what trading restrictions or trading windows you're going to have. Because a lot of people get super excited about IPOs. And as I've seen employees struggle with this is that, you know, the stock goes public. And even if you play best case scenario and it pops, it goes way up, you can't sell like everybody else. Usually you're kind of restricted on that. And it's not uncommon that when the window opens and it's like everybody jumps off the boat at the same time, that you get crushed.

• 14:53Brian Preston?

  You're like, how is this not a pump and dump? That's why, you know, you need to pay attention to what your, your, your trading windows. And that leads to the bigger things. When in doubt, zoom out. What do you really think about this company? Now, you already have your human capital, meaning you work for this company. But now that you're about to put some investment capital into it. Is this part of your permanent portfolio? Or is it not that I don't, I just want you to go through that analysis. I'm not really saying to make this part of your permanent portfolio. Cause that's going to be the next thing is we're going to say, hey, get rid of a portion of it. Once you, you can, because you have so much human capital tied into it. But you do need to say, is this more sizzle? Or is there actually foundationally, this is a great company and this would be a great opportunity.

• 15:37Brian Preston?

  So that I can weather whatever crazy volatility happens during these IPO windows.

• 15:41Speaker 03

  The other thing that I would ask in your specific situation is where am I in the financial order of operation? Bro, you hold that thing up for me. If you have a solid financial foundation and you have been following the steps and you've been building up a solid financial base. This may be an area where you want to take advantage of. But if you have a lot of like high interest debt out there, or you don't have a fully funded emergency reserve, or you don't have adequate dollars flowing into retirement accounts, like health savings accounts or Roth IRAs. This may be premature for you. And what I want to see you do is get a lot of your capital invested in something that may not be liquid for a certain period of time, when there are other stuff, other things that you should have been checking the box on.

• 16:24Speaker 03

  So I'd make sure that if you are going to participate, that you're at the stage of your financial journey where participation makes sense.

• 16:32Speaker 04

  Fantastic. Well, Ken, thank you for your question. Appreciate you being here. We're going to go to Connor's question next. It says, at what point does the benefit of tax diversification, Roth plus taxable, outweigh the immediate tax savings of traditional 401k contributions for high earners trying to catch up?

• 16:53Speaker 03

  All right. So.

• 16:54Brian Preston?

  I got two answers.

• 16:56Speaker 03

  Okay, go. Yep, you do it. I'll read it again.

• 16:57Brian Preston?

  There's two things that there's, there's really two things you've got, two levers you gotta be paying attention to. Your, your current tax situation tied into your overall long-term tax outlook. So, and that's why if you notice, we have slides that we pull up all the time is that if you're young in a low tax situation, because you're not in your peak earning years, that leads to like Roth savings. It's pretty easy to do a Roth 401k. So you can really maximize the tax-free compounding growth. But if you're a person that's in peak earning years and you're paying, you know, close to half of your money of what you earned to taxes, both local as well as federal, you know, then we gotta think about that. Because maybe when you take your earned income off the table in, in a retirement.

• 17:41Brian Preston?

  You might have a tax arbitrage situation where you could do Roth conversions or other things. And then the other part is it needs to be goals driven. That's why we have step seven of the financial order of operations is because so much of the early stages is taking advantage of all the tax opportunities that the government's built into our tax policies to incentivize you to save. It's when you get to step seven that says, hey, wait a minute. If you're part of the fire slash fine movement, you want to move on to a next endeavor and change jobs and have options to use your army of dollar bills. We better make sure we pay attention to the structure or makeup of each of these accounts so that we can actually fulfill those goals and have access to them.

• 18:20Speaker 03

  Yeah, I wrote down two things and it's sort of an echo of what you said. When do you need the dollars? If you are doing like an early retirement thing, you need access and having an after-tax account may be something that's incredibly valuable so you can get to those dollars. And then the second thing I put is what's the ultimate purpose of the dollars? We have a number of clients that reach this position where we recognize that their qualified accounts are going to be so large that even with the tax planning we plan to do at Financial Independence Retirement, we're still going to have an issue of being able to convert dollars for long enough. And ultimately, the reason why they might switch to building up the Roth dollars is more about legacy planning than it is about their own financial planning. So when you think about the dollars that you're saving, okay, I could get this current

• 19:03Speaker 03

  year tax benefit, but based on my financial circumstances, based on where I'm going to pull my dollars, based on the money I'm going to need to use, it's more advantageous for me to build up Roth dollars so that this is something I'm thinking for the next generation, something I'm building up there. So when will you need the dollars? And then what's the purpose of the dollars? I think answering those questions will dictate when you should switch and I should think about switching from pre-tax to not exclusively pre-tax. Bless you.

• 19:33Speaker 04

  Yes, bless you. You startled us all with your sneeze. Well Connor, thank you for the question. Um, remember, or I guess I'm telling you now, we are doing rapid fire today. The It Does Not Depend Rapid Fire segment. That will be coming up a little later in the show, probably between the 30 to 40 minute mark. So if you're watching live, add your rapid fire questions to the chat. Just make sure to put RF for rapid fire at the beginning. So we know that you want to be a part of that. So get those questions in and in the meantime, we're going to keep answering your questions just at a normal speed.

• 20:06Speaker 03

  Can I ask a question?

• 20:06Speaker 04

  Sure.

• 20:07Speaker 03

  You know, we, we announced and launched our brand new deliverable.

• 20:10Speaker 04

  We did.

• 20:10Speaker 03

  Last week, can we do it Paul? Has everyone checked it out? Did you guys go out and download that deliver? Cause we are super, super excited. We even got some press on it this past week. There were some, um, large institutions that grabbed it and kind of did a little write up on it, which was super cool. We put a lot of work into it. If you've not checked out, how much should you save? Go to moneyguy.com/resources, download your free copy right now. Uh, and let us know what you think because it's something we spent a lot of time thinking through to hopefully be super valuable for you guys. That part was for free.

• 20:38Speaker 04

  Oh, I love it. Moneyguy.com/resources. Definitely check out how much should you save? All right, ready for another question?

• 20:45Speaker 03

  Mm hmm.

• 20:46Speaker 04

  Let's do it. Kai Guntoe 230 says, I'm about to pay off my 23 8 loan and I want to pay cash for a car in seven years.

• 20:57Speaker 03

  Okay.

• 20:57Speaker 04

  What's the most optimized way to do a sinking fund? High yield savings account or brokerage? If brokerage, when and how do I exit the market?

• 21:07Brian Preston?

  See Kai's got us a little bit because he said seven years.

• 21:11Speaker 04

  I know, it's right on that cusp.

• 21:12Brian Preston?

  So I mean, that is, that is getting on out there to where, you know, this is going to be a more of a diversified answer than, than just saying go straight cash.

• 21:22Speaker 03

  I'll tell you what I would do. If this were me, so you write this in pencil because this is sort of like an opinion here. I'd probably go sort of a half and half strategy, right? Like if I know that I want to pay cash the car in seven years, I'm going to save up, you know, I'm going to do my time value money calculation, figure out how much I need to save up and I might have half of it go into a brokerage account, low cost index funds, half of it going to high yield savings account because I know realistically, a lot of stuff changes over the course of seven years. I might get pay raises, I might get bonuses, my expenses might decrease. I might have other capital inflows that take place. So I want to be careful being all or nothing, one way or the other. But I do think seven years is far enough out there that a sinking fund in pure cash, pure high yield money market,

• 22:07Speaker 03

  you're going to miss some opportunity there. But I also don't want to go hog wild and have all of it in a brokerage account. And then in the moment when my car dies or when I need to replace it, the market's not at a great spot. I kind of like the 50 50 approach.

• 22:20Brian Preston?

  So let me, let me put it because I think Bo's answer is right on. So I would say if you, if you have the need for the car within the next three years, it's, it's a no brainer to do high yield savings account, cash only. That three to five years starts to become a gray zone where you can start introducing, you know, maybe we've take 20%, 30% into investments. Five years and beyond, now you're kind of in the territory where Bo is on solid ground is that I think it's okay to having a balanced approach to where you have half of it in investments or index funds. And then you can do half of it in liquid, you know, liquid investments. That way, just in case you have some flexibility, in case decisions are forced upon you sooner than you planned,

• 23:05Brian Preston?

  you're going to be able to weather it, whether that comes in as the car breaks down in the few, next few years, or even in the next three years, you have some market volatility. You have enough timeframe, it's going to be A okay.

• 23:19Speaker 04

  Feel good about that?

• 23:20Speaker 03

  Good.

• 23:21Speaker 04

  Love it. Good question, KaiDunto230.

• 23:25Speaker 04

  All right, let's move on to NewberryCharles. His question is, when's the point you should get a financial advisor? I just hit 1 million net worth this week.

• 23:36Speaker 03

  Oh, congratulations.

• 23:38Speaker 04

  And I want to thank you guys for that, too. Been a blessing to learn from you all. Very kind. But big milestone. And we always talk about hitting these milestones, investing milestones, cash flow milestones. We've even got some shows coming up on that soon. So make sure you're subscribed here on YouTube. But what would you say to NewberryCharles? When should he think about hiring a financial advisor?

• 23:57Brian Preston?

  Bo, you know, there's a big difference between 1 million net worth and 1 million of investable assets. How does that shape the answer?

• 24:06Speaker 03

  Yeah, because if you have a, if you had a million dollar net worth and 800,000, 700,000, all of it's a liquid portfolio with different account types, different account structures, then I'd argue potentially a financial advisor makes sense. But maybe you've hit a million dollar net worth and it's because you bought a home and you're in a high-cost living area where the value of homes have gone up substantially. And so your 400,000 dollar house turned into an 800,000 dollar house. And there's not, not there's anything wrong with that, but that's a different level and different component of complexity than the other one. And so generally, we say that it makes sense to hire a financial advisor when one of three things happen. Can I say the three things?

• 24:48Brian Preston?

  Yeah, go ahead. Go through the three things.

• 24:49Speaker 03

  When one of three things happen. Number one, the gravity of your financial decisions is greater than you feel like navigating on your own. Meaning, man, okay, if I made a, if I made a 10% boo-boo on 100,000 dollars, maybe it doesn't change my life. But I make a 10% boo-boo on a million dollar net worth, well, now it's substantial. And I just want to make sure, I want to make sure that I'm not missing anything. The second point is, I just don't know what I don't know. Life has gotten complicated. My taxes are more complicated. My portfolio structure is more complicated. I have access to more accounts. Whatever that thing may be in your world, complexity is entered in and you're just nervous. I want to make sure that I know what I'm supposed to be doing and I'm not doing the things I'm not supposed to be doing. So there's like a complexity component.

• 25:34Speaker 03

  So number one is gravity. Number two is complexity. And then number three is time. Often in our lives, as our financial, as our lives take shape, the important financial matters tend to fall to the back burner. Oh, man, I'm in the messy middle and I know I should get life insurance, but gosh, I can't reach out to the agent or I know I need to do my estate documents or I haven't rebalanced my portfolio in the last seven years just because I don't have time to look at it. If you find that really important financial matters are falling on the back burner, a good financial advisor can help keep the important stuff in front of you. So if you find yourself in one of those three areas or potentially all of those three areas simultaneously, that might be an indication that you should reach out to an advisor.

• 26:17Speaker 03

  So does that mean, hey, as soon as I hit a million dollar net worth, I have to have a financial advisor? No, not, not, not at all. And there are a lot of people who will never hire a financial advisor and I'd argue that's okay. You'll have to decide for yourself, okay, could I get value? Or is this something where I would have a greater sense of peace and a higher confidence in my future financial security by having a personal CFO on my side?

• 26:42Brian Preston?

  And Charles, if you realize, hey, I think, I think I qualify or I definitely see a need, I'd encourage you to go to moneyguy.com/resources. We have the eight questions you should ask anybody you're considering for financial advisors. Cause by the way, we're not all created equally. You know, we just did a react recently where I was like, there's a huge difference between an investment advisor who's only just helping you shape allocation versus a full financial planner. Who's impacting all parts of your life, whether it's education planning for the kids, retirement planning, estate planning, taxes going through. I mean, I feel like we pay for a lot of our fees by just not doing the tax return, but just making sure that all of your wishes are fulfilled or it's done or recorded correctly when you're following

• 27:27Brian Preston?

  those annual tax returns. That's the type of stuff that a financial planner should be doing for you. It's outside of even the investments so that you're getting that extra, what we like to call the, the alpha and the gamma and all the things that when you do look into the research on it, that a good financial advisor actually adds a lot of value to your life and frees up more time.

• 27:49Speaker 03

  Love that.

• 27:50Speaker 04

  Love that. Update on our poll from the YouTube live chat. Have you seen our latest resource? We asked 61% said, of course.

• 27:58Brian Preston?

  Nice.

• 27:59Speaker 03

  Love that.

• 27:59Speaker 04

  They've gone and downloaded it. 39% said, going to check it out now.

• 28:03Speaker 03

  Let's go.

• 28:04Speaker 04

  That's what we like to hear.

• 28:05Speaker 03

  But don't leave the stream. Do it, you know, check it out on a dootab and then come back and hang out with us.

• 28:09Speaker 04

  Yeah. Oh, you can absolutely do that. But yeah, we're very excited about that resource. I'm, I think it's very powerful and very interesting.

• 28:17Brian Preston?

  It is, it is cool when you see articles written on some of the research and content deliverables that you do and you're like, all right, this is connecting.

• 28:25Speaker 03

  That's awesome.

• 28:25Brian Preston?

  It's connecting with the general public. And I think, because the thing I like about this one, because we've always been pretty consistent with the 25% savings rate, but we've known that the flaw in it was that for somebody who starts super early, you know, you have such a powerful component of the arm, of your army of dollars because time, being a billionaire of time. I didn't like it saying in the old version that, you know, you have 157%. What I like about this is this, you know, rubber meets the road is if you're starting early, this tells you, hey, maybe your savings rate goes as low as 15% in some situations or even 10%. But if you're somebody who kind of procrastinated, this is going to give

• 29:08Brian Preston?

  you the tough love that you need. So it kind of meets you right where you are.

• 29:11Speaker 03

  I like that it's not discouraged. A lot of people are saying, because we'll talk to 20 year olds, like, guys, I love your stuff, but I'm never going to hit 25%. So why should I even start? That was one of the biggest impetuses for us. Empati? Is that how, is that the plural of impetuses?

• 29:25Brian Preston?

  Implementing.

• 29:27Speaker 03

  No, I was just trying to look for the plural of impetus, like multiple. That was one of the many reasons.

• 29:32Brian Preston?

  That's an SAT word.

• 29:33Speaker 03

  It was one of the many reasons why.

• 29:35Brian Preston?

  I'm good at math.

• 29:36Speaker 03

  It was one of the many reasons why we did this one, because we don't ever want building wealth to be discouraging. No matter where you are, no matter where you started from, the way your journey begins does not define the way that it ends. And we think this deliverable really shows that. It doesn't take a whole lot if you can figure it out early. And that's, I'm excited that we now have one that shows that.

• 29:54Brian Preston?

  Listen, you and I both eat pork, eat, eat pork rinds.

• 29:58Speaker 03

  Yeah, we do.

• 29:59Brian Preston?

  So we don't say the words impata or whatever that is. That's not a pork rind type eating person.

• 30:04Speaker 03

  That's not a pork rind vocabulary.

• 30:05Brian Preston?

  And by the way, I love pork rinds. So that's not a compliment or a cut if you like pork rinds yourself. I'm just saying that we're just everyday folks.

• 30:11Speaker 03

  Yeah, I try to, I'm like, I'm trying to like eat healthier and do that kind of stuff.

• 30:15Brian Preston?

  Really?

• 30:16Speaker 03

  I convince myself. I convince myself that like, uh, like pork rind, oh, like it's like a healthy snack because it's like protein, right? I don't think it's healthy. I don't think pork rinds are good for it.

• 30:26Brian Preston?

  My favorite thing is that I went to, these are, like, I have a friend and he loves his, his like conversation starter is things that rich people and ultra poor people have in common.

• 30:39Speaker 03

  Okay.

• 30:40Brian Preston?

  And, and there's some funny things if you've seen people go on that, that line of thinking. But I actually had an experience where my wife and I were doing a staycation at the Hilton Conrad in Nashville.

• 30:52Speaker 03

  Okay.

• 30:52Brian Preston?

  And you know how these, these bougie fancy hotels or restaurants will do things sometimes, you're like, uh huh.

• 30:59Speaker 03

  I, I'm on this.

• 31:00Brian Preston?

  Their, their like thing that they brought out that, you know, to open the meal were like fancy versions of pork rinds. And then when I was out in Vegas, we had a dinner and we were at some like meat heavy restaurant. And they brought out pork rinds and I was like, these are, they don't call them pork rinds, by the way.

• 31:18Speaker 03

  Right, right, right.

• 31:19Brian Preston?

  It's kind of like grits and polenta, you know, they're all related, but it's, um, but they don't call it. But if you, if you, if you know, you know, is that's a pork rind.

• 31:29Speaker 03

  Whenever I see fried bologna on a, on a menu, I'm like, I've.

• 31:34Brian Preston?

  Okay, now you might have actually broken the system is that they have not fancy people have not. I don't think they call.

• 31:40Speaker 03

  Oh, I'm still not eating fancy restaurants yet.

• 31:42Brian Preston?

  Fried bologna has cracked the hollowed hallways of being wealthy people do.

• 31:48Speaker 03

  Well, I know when I was a kid, that was like a big, that was like a delicacy, right?

• 31:52Brian Preston?

  Roberts, if you go, if you go into the honky tonks in Nashville, you still go to the recession special and they will get you a fried bologna sandwich, I think at Roberts.

• 32:01Speaker 03

  Have you ever had fried bologna before, Rebi?

• 32:03Speaker 04

  Yes, when I was younger.

• 32:04Speaker 03

  Okay, I wanted to guess. Pork rinds big in Ohio?

• 32:09Speaker 04

  I don't know. I don't think so. I never really had that much. I'm trying to think if I've actually had a pork rind.

• 32:17Speaker 03

  Oh, well, I guess.

• 32:18Brian Preston?

  Really?

• 32:18Speaker 04

  Yeah, but I don't know if that's just a me thing or if it's in Ohio.

• 32:21Brian Preston?

  I mean, I literally, when I went down to Augusta a few weeks ago, I literally had a bag of pork rinds.

• 32:27Speaker 03

  You know how I know she's never had them?

• 32:28Brian Preston?

  On the road trip.

• 32:29Speaker 03

  Cause she ended the word with a D. She actually said pork rind. I don't know if you're listening to me and Brian, we're calling them pork rinds because that's what they are. It's like a R and a Y and an N and just a bunch of N that ends with an S. That's how you know.

• 32:43Speaker 04

  That's how you know.

• 32:44Speaker 03

  That's how you know.

• 32:45Brian Preston?

  I know. Another thing we gotta do with Rebi, how about boiled peanuts?

• 32:48Speaker 03

  Have you not had boiled peanuts?

• 32:49Speaker 04

  Don't make me say it.

• 32:50Speaker 03

  Have you not had boiled peanuts? How do you know this?

• 32:52Speaker 04

  No, I think I have had those. But I don't say it like you do. I say it like a midwesterner.

• 33:00Speaker 03

  How do you say it?

• 33:03Speaker 04

  Boiled peanuts.

• 33:05Brian Preston?

  Okay, that sounds, that sounds okay. I didn't say that.

• 33:07Speaker 03

  Bald.

• 33:08Speaker 04

  Sounds exactly. I think we're really the same, same person. Okay. Well, on that note, we are going to do rapid fire after the next question. So last chance to get your questions in, but until then, Skippy has a question for you.

• 33:25Brian Preston?

  Next to Jeff, I like me some Skippy.

• 33:27Speaker 04

  You're gonna love this question. Wait, what?

• 33:30Brian Preston?

  Skip, we both were thinking about peanut butter as soon as you said Skippy.

• 33:34Speaker 03

  That's hilarious.

• 33:37Speaker 04

  Oh, man.

• 33:38Brian Preston?

  So hungry.

• 33:39Speaker 04

  All right. Um, the question, you're gonna love the question even more. Are you ready for it?

• 33:43Brian Preston?

  Okay.

• 33:44Speaker 00

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• 34:14Speaker 04

  When, if ever, is it better to lease a car rather than buy? At the end of a lease, how do I decide on buying the car or moving on?

• 34:25Brian Preston?

  Bron, I'll let you do this.

• 34:25Speaker 04

  Discuss.

• 34:28Brian Preston?

  Okay, look, the easy answer, I'm gonna give you all the easy answer and then I'm gonna level set with you. You need to be in step eight, even consider leasing a car of the financial order of operations. But then now let me, let's get down into the weeds on this. Is that I have actually leased my first car because I love my wife. And look, we make, you know, sometimes love is irrational. And you see things for what they are, you know, and I've told you all, y'all have heard me, some of the biggest rants of my, of my broadcasting career have been on her prior European luxury SUV. And to repeat the same mistake over and over is insanity. So I was like, at least we're gonna mix this up.

• 35:10Brian Preston?

  And instead of buying this horribly depreciating, expensive to operate vehicle, we're going to lease or rent this bad decision. So that's, that's what I've done. And then she, by the way, she is happy as she can be with that car. Cause it, and she does look good. And I pass her on the road in it every now and then coming in and out of the neighborhood going and. Doing things, I'm like, she looks good in that thing, but you know, we're going to be able to get rid of this bad decision before it actually starts showing its warts.

• 35:38Speaker 03

  So here's my, the question is, when, if ever, is it better to lease a car than buy? And so what we're asking is a comparative question, not an absolute question, because I would argue that auto leases are not a very sound financial decision. But there are consumers, I agree with you, Brian, in step eight, that's where it should happen. But we have people and there, I have someone in my life, it's a relative of mine who I love incredibly dearly. And she sent me a text message the other day and she said, hey, look what I just got. And it's a brand new car. And I'm like, whoa, what you, why, why'd you get, you just, your car's not that old. You just got that other car like three years ago. And she's like, well, guess what?

• 36:20Speaker 03

  I took it in for some service and they made me a deal I just couldn't, I couldn't turn down. Would you believe that I actually have a lower payment now and?

• 36:29Brian Preston?

  It's all on the payment.

• 36:30Speaker 03

  And I, I borrowed it for even, it was even less time than my last car. And I'm like, no, all you did was, all you did was like reset. And so I kind of like walked through and explained the mathematics to her. In the situation where someone is trading out new cars every two, three, four years, if you're a buyer and you're buying those cars, all you're doing is paying for all the depreciation upfront. You just keep paying it over and over and over again. So if you're going to be that kind of consumer, there's a mathematical justification that leasing a car may actually be more advantageous than you buying the car, paying the depreciation, losing the value, rinsing and repeating. Now, neither of those are good choices or good decisions, but that's a scenario where if that's the kind

• 37:12Speaker 03

  of consumer you're going to be, you'll likely save yourself some money by making that poor decision slightly better.

• 37:19Brian Preston?

  Yeah. By the way, this, this vehicle that we are renting, it depreciates like a rock. Cause I don't think anybody, by the way, you can go buy this luxury car, go look at these vehicles seven years in the future and you're like, why are they giving these cars away? It's because they have air suspension systems that definitely go need requirements. They're over engineered and they create a lot of trouble. So that was my thing was that they depreciate like a rock. And then I knew the maintenance, because by the way, this one that we have. It's not only an over engineered car. It has an electric battery in it, too. It's one of those plug in electric hybrids with a motor in it. And so that's why it didn't work.

• 38:03Brian Preston?

  But I'm also being told, we're getting a mid question update that Skippy, not Jeff, is in step three. So without a doubt, you do not need to be leasing a car. You need to be, if you're, if you've got high interest debt, you need to get something that gets you reliably from point A to point B. It's not to maximize the loving your relationship or how cool you look out there to society.

• 38:29Speaker 03

  You've got to figure out how to get your transportation costs down to as low as reasonably possible. I don't say as low as possible because I'm not specifically an advocate for like to go buy a thousand dollar clunker. I think oftentimes that can be more expensive. But buy the lowest priced, most reliable car that you can to get your car payment or to get your transportation costs as low as possible because you need all of that margin right now to be going to step three, knocking out that high interest debt. Car leases and buying new cars and replacing cars, not where you need to be if you're in step three.

• 39:04Brian Preston?

  I've got an update coming out to some things. I'm not ready to share it all, but I've been writing a lot and Rebi knows she's read it, but timing of major purchases definitely matters. And if you're only in step three and you're a young person, you need to make these type of decisions. That's why step eight is going to be there to protect you. But most people are going to reach step eight until, you know, their wealth multiplier is in a completely different place. So don't make fake purchases in your 30s or 20s. You know, let yourself actually have some, some success, you know, so that you can buy in those abundance goals. And maybe that's when you reward yourself with a fancy car.

• 39:40Speaker 03

  Yep.

• 39:42Speaker 04

  That's great. Skippy, thank you for the question. We're glad you're here.

• 39:46Speaker 03

  I think Skippy said they're new here. So hey, welcome. Skippy, if you've not subscribed, since we asked you to subscribe right now, so that way every time we put out brand new content, you will get updated so you can continue to do money better.

• 40:00Speaker 04

  Love it. All right. It is time for it does not depend rapid fire segment where Bo and Brian will answer, bro and Brian will answer your questions in 30 seconds or less. And I will give them the opportunity at the very end of the segment, uh, well, since they can't say it depends in the answer, in the 30 second answer, we'll give them a chance at the end, or maybe it does depend segment where they can expound if they really feel the need to on the questions. Okay. So.

• 40:35Speaker 04

  Are you guys ready?

• 40:37Speaker 03

  Did you just snort on air?

• 40:39Speaker 04

  What is going on?

• 40:40Brian Preston?

  It feels like, it feels like when we do these, typically I take 25 and you get five. So I apologize. Bo just said the quiet part out loud. You only get 15.

• 40:48Speaker 04

  Are you guys going to alternate who starts or are you just gonna go, okay, who's starting?

• 40:53Speaker 03

  This is a gentleman's game.

• 40:54Speaker 04

  All right. Brian's up first then.

• 40:57Speaker 04

  Are you ready?

• 40:58Brian Preston?

  No, but let's go.

• 40:59Speaker 04

  Should I make Bo go first?

• 41:00Brian Preston?

  No, we go.

• 41:01Speaker 04

  All right. Brian's first. All right. 30 seconds on the clock. Here's the first question. Where do, where does accelerated 401k loan repayment come into the food?

• 41:15Brian Preston?

  I mean, I think that's probably a, that's probably like a three, a step three type thing, because you, you want to get that, that 401k loan paid off very quickly.

• 41:28Speaker 03

  Step three, any 401k loan is a high interest loan because of the opportunity cost of those dollars, you should get that knocked out quickly.

• 41:40Speaker 04

  Very well done, team. Next question.

• 41:44Speaker 04

  You both used your 15 seconds.

• 41:46Brian Preston?

  I like that. I'm like, I'm like fishing around the dark and then Bo comes in definitively with an exclamation point and then he gives me still the fist bump.

• 41:54Speaker 04

  All right. Next question. I'm in the 25 to 30% tax rate. How do I determine if I should do Roth or traditional?

• 42:03Speaker 03

  You need to look at your other accounts. How much pre-tax money do you have? How much Roth money do you have? What is your timeline to being able to need those dollars? How young are you? How old are you? And based on the answer to those questions, it'll lean you one way or the other.

• 42:19Brian Preston?

  Yeah, if you're young, Roth IRAs are going to be really powerful, all the compounding growth you get out of that. If you're older and you think your taxes will be lower in the future, you might want to take advantage of traditional.

• 42:32Speaker 04

  All right, we're covering a lot of ground here within the time limits. Next question.

• 42:37Brian Preston?

  Did we say it?

• 42:38Speaker 03

  No, no, we didn't say it.

• 42:40Speaker 04

  I mean, you did skirt right around it, but you, you.

• 42:43Speaker 03

  We gave the variables.

• 42:45Brian Preston?

  I didn't say the D word.

• 42:48Speaker 04

  None of them, actually. You didn't say any D words. Okay. Next question. Is a concierge doctor worth it? Step eight at 26 years old with 500K invested.

• 42:59Brian Preston?

  Yes. I mean, health is wealth and so you should act accordingly, especially with the way technology and innovation is going on in medical science right now.

• 43:09Speaker 03

  Money is nothing more than a tool that allows us to achieve our goals. For me specifically, health and being as healthy as possible for as long as possible is super, super important to me. So for that, concierge doctor is justified, one of the costs and something that if you're at that stage where you can afford it, I am a huge advocate for it.

• 43:28Speaker 04

  Nicely done. All right. Next question. If you're the trustee and ultimate beneficiary of an irrevocable trust, would you include said value in your net worth? Principal and corpus is protected from spend down per trust docs. That last part was confusing.

• 43:47Speaker 03

  If you're the, read the, stop, you can't stop. Okay.

• 43:50Speaker 04

  We can start over. That last part was hard to read.

• 43:52Speaker 03

  So you're the trustee and the beneficiary. You're asking, should I include the value of this trust in my net worth?

• 43:58Speaker 04

  That's the main question.

• 43:59Speaker 03

  But there are spin thrift provisions that don't allow me to get the principal and corpus.

• 44:02Speaker 04

  That's what it looks like. Yes.

• 44:03Speaker 03

  Okay, got it. In that scenario, the trust is an income-producing asset for you, not an actual asset yet. It's likely, if you're the beneficiary, you'll get it at some point in the future. I would treat it like an income source, income statement item, not balance sheet item. So probably not on your net worth statement. I'll put it on the footnotes.

• 44:22Brian Preston?

  I was gonna say the exact same thing, because it's basically promises of future cash flow things. It's, it's, so it's no different than like social security or other things, is that there's definitely gonna be value for health, education, maintenance and support, but it's not something that you have access to, so you can't put it on the net worth.

• 44:38Speaker 04

  Oh.

• 44:39Brian Preston?

  I went, I went a few seconds over.

• 44:41Speaker 04

  He skated right over the time.

• 44:42Speaker 03

  I stalled too from it.

• 44:43Brian Preston?

  Sorry, sorry.

• 44:45Speaker 04

  Next question. New baby, what's the best account option for him and why?

• 44:50Brian Preston?

  Are you at step eight, is the first question? If so, then I like custodial accounts for weddings and house purchases. I like 529s for education and priming the pump to make sure your kids are gonna be productive with their labor.

• 45:08Speaker 03

  Love both of those. I do not love people that get really, really aggressive and try for a newborn to do custodial Ross because their baby's little baby model. I would say stick to 529s or UTMAs.

• 45:21Speaker 04

  The end.

• 45:21Speaker 03

  I was gonna say, depending on, but I didn't say it. I didn't say it. I didn't say it. I stopped. That's called discipline. That's one of the three ingredients of wealth creation.

• 45:29Speaker 04

  Okay, okay, okay.

• 45:31Brian Preston?

  You said the D word. Came to, close to.

• 45:34Speaker 04

  I know.

• 45:36Speaker 03

  I didn't say it till after the end.

• 45:38Speaker 04

  Somehow take points away from that, but we'll let it slide. All right. Next question. I would like to start working for myself soon, next year or two. How can I best plan for my future as I transition from an employee to a self-employed 29-year-old?

• 45:55Brian Preston?

  Who, who's supposed to go first?

• 45:58Speaker 03

  You go first. Go.

• 45:59Brian Preston?

  Put on your 3D glasses. There's some D words. Is you want to have your dream plan run the scenario for the next few years? You want to have the down to earth of what you actually think will happen and then don't skip out on the do do plan, meaning it doesn't go as you plan.

• 46:11Speaker 03

  In addition to 3D glasses, cash, cash, cash, cash, cash. Cash is the oxygen you'll need as a small business owner. I would save up more than you think you need so you can give it longer than you think it will take.

• 46:23Speaker 04

  Wow. Well done.

• 46:25Brian Preston?

  I felt like we even, we only had 25 seconds to start that one. There was some, some.

• 46:29Speaker 04

  Cause you kind of looked at each other for the first couple of seconds. All right. Next question. Bo, leg day, arm day, or cardio? Rank from favorite to least favorite.

• 46:41Speaker 03

  Arm day, favorite. Cardio, cause then it helps you get ripped. But I love legs too. So I'm like, I like all three. I'd say one, then like it's like a two A, two B deal.

• 46:52Brian Preston?

  Why did that question get asked to Bo? Is it because he's a giga Chad and then everybody just assumed? I don't know.

• 47:00Speaker 04

  Do you have a ranking?

• 47:02Speaker 03

  I didn't say that, did I?

• 47:03Brian Preston?

  Somebody just held that up.

• 47:04Speaker 04

  Oh, really? Did they?

• 47:05Speaker 03

  Did I say it? No, no.

• 47:08Brian Preston?

  Oh, you guys. No, we have to say.

• 47:12Speaker 04

  It is true that somehow you easily could have thrown in, it depends.

• 47:15Brian Preston?

  If we didn't say the male diaper or the adult diaper, then it doesn't count.

• 47:19Speaker 03

  I look, I'm not going to screw up a weightlifting question, right? Like that's not one I'm gonna screw up. Uh, me and the boys, we, we love, we love arm day.

• 47:28Speaker 04

  Your time is up. Your time is up. Come back to it.

• 47:30Brian Preston?

  Are we still, are we still doing this? Cause you even got a gift yesterday.

• 47:34Speaker 03

  I did get a gift yesterday. Uh, stay around after rapid fire segment. I'll tell you about the awesome gift we got yesterday.

• 47:41Speaker 04

  Next question. When calculating your emergency savings, can you factor in a guaranteed severance from your employer?

• 47:51Brian Preston?

  No.

• 47:54Speaker 03

  No. Here's why. Being unemployed is an example of an emergency. But what if the emergency you have does not involve losing your job? What if it's car goes out, HVAC goes out, medical emergency, some of those things where that severance doesn't pay out? Just because it's guaranteed if you get severed, it's not necessarily guaranteed. And a lot of guaranteed severances say, so long as you're not fired for a cause. Like, what if you screw something up or something?

• 48:22Brian Preston?

  Yeah, that was the only thing I was going to add is that.

• 48:25Speaker 04

  Time's up.

• 48:27Speaker 03

  We're going back to guaranteed severance because I'm on the same, I'm on the same page as you.

• 48:31Speaker 04

  We'll come back to it in our next segment. Okay. Next question. Wife and I are age 35 with three kids and eight times our income invested.

• 48:41Brian Preston?

  Wow.

• 48:43Speaker 04

  Our dream home breaks the home buying rules and will cost five to six times our income. Since we are ahead of the curve, can we buy it?

• 48:54Speaker 03

  You've got to stress test this to see, because being ahead of the curve does give you flexibility. Now, what I don't think you can do is allow your monthly note to be exponentially above the 25%. What you may be able to do is decrease your savings to build up the down payment to then be able to afford the home and get it inside the affordability.

• 49:10Brian Preston?

  Or even go see how ahead of the curve you are and be honest with yourself and maybe use a little bit of capital to increase your down payment so that that payment does reach within our 25%.

• 49:24Speaker 03

  We're coming back to this one.

• 49:25Speaker 04

  I am very impressed that you actually got a good answer there in that 30 seconds, though, because that was a doozy. There's a lot of, uh, it depends in there. Okay, next question. Is slowly investing $50 per month in a cloud storage and AI-focused fund like FSPTX too non-diversified? Currently investing roughly $400 per month at 23 years old. Am I too bullish?

• 49:53Speaker 03

  400 a month at 23, you're up.

• 49:55Brian Preston?

  I, look, we've been there, done that. I did the internet fund when I was your age. And I made money immediately and then ended up selling it at a loss eventually. So I, I still like, nothing wrong with you dabbling it, but just don't, don't let it be your eating money.

• 50:09Speaker 03

  I want to know what else you're saving because at $400 a month for a 23 year old, if you were just to plop that in the SP 500, go play with a wealth multiplier, see what that can turn into. I don't want you to waste opportunity. Nothing inherently wrong with those like sector plays, but that's more the, that's more the vacation stuff, not the main core. That's more like the dessert, not the main course.

• 50:29Speaker 04

  There you go.

• 50:30Speaker 03

  She didn't call me. Thank you for taking a sip.

• 50:32Speaker 04

  It was slightly over. I, I don't know why I had grace. I think I was just looking at the next question, which is our final question, last but not least, Star Wars or Star Trek? And why? And does Bo know the difference?

• 50:46Brian Preston?

  I mean, we just, we just came through, may the fourth be with you. So, I mean, I'm going to choose Star Wars and they've made it easier with the way they've handled the, the Star Trek franchise. But Star Wars.

• 50:59Speaker 03

  I would say Star Wars also.

• 51:02Speaker 04

  Because you know more about them.

• 51:03Brian Preston?

  I do like them both though. And I, and I, and I hope that, I think that, I think the next decade's going to be good for both franchises. I really do.

• 51:10Speaker 03

  Oh, they're still adding, they're still adding to both of them? They're still doing more stuff?

• 51:13Speaker 04

  I think so.

• 51:14Brian Preston?

  I mean, yeah, there's, there's things in the works right now.

• 51:17Speaker 03

  Star Wars at, um, at Disney, like the whole thing or whatever, wild. I was very impressed by that. Like the whole, like it was just, you do feel like they're in a different, like in a different universe, man.

• 51:30Speaker 04

  Very fun. Well, that concludes our it does not depend rapid fire segment. Now it's time for our maybe it does depend segment where Bo and Brian get a chance to expound on any questions they didn't have enough time to do. So I have one where you said you definitely wanted to come back. It was talking about calculating your emergency savings. Can you factor in a guaranteed severance from your employer? Did you have anything else to say on that?

• 51:54Brian Preston?

  Yeah, that one, that one is, um, Look, the reason you have emergency reserves is to keep you from making desperate decisions. And part of what makes desperate decisions is your employer's cash flow coming in. And yes, they might tell you, we have a guaranteed severance if we ever separated ways or we went out of business. But I bet if you read the fine print, you'll see exactly what Bo said is you're still an at will employee in a lot of cases. There's lots of outs for your employer and we're trying to build independence outside of the obligations or your employer. So that means you need to stand on your own feet.

• 52:30Speaker 03

  I love that. I don't have anything to add to that because I do, I agree that like, emergencies are the things that you're not counting on. They're the things that can come out of left field on a random Tuesday. I think your emergency fund should be a true emergency fund and you should not try to find ways to shrink it or minimize it. Set it, let it hang out there, chisel it away, compartmentalize it. And then get under wealth building, but don't sacrifice it. Don't try to get too cute with it because when you need it the most is when you will be the, is when you will be the most thankful that you actually have it there. That was guaranteed severance. There was another one.

• 53:12Speaker 04

  Yes, about buying the dream home. They have eight times invested. They're 35 with three kids. I know you have more to say.

• 53:21Speaker 03

  Yeah, because here's what, all right, so this is, I'm going to reframe this for those of you that just got here. This 35 year old couple, they said they got eight times their income saved up in their investment portfolio. Well, we say that by the time you get to 40, we want you to have six times your annual income. So they're like well ahead of the curve, like well, well, well ahead of the curve based on like sort of the, I'm going to say the averages, but kind of based on the milestone trajectory. What I'd want to figure out is okay, well, what goals are you ultimately working towards? Like what's the future? Because money is nothing more than a tool that allows us to do the things we want to do. One of the things that might matter to you at 35 is My kids are young, we're young, we want to have our dream home.

• 54:01Speaker 03

  There's no point in us waiting until we're 75 years old to finally be in our dream home and not be able to enjoy it. And because you're so far ahead of the curve, if you are ahead of the curve, because of all the hard work you've put in, you give yourself some latitude and flexibility to make some different decisions that other people who have not been as diligent, might not be able to make. So I would figure, okay, are we on track for retirement or financial independence, whatever we're working towards? If we were to decrease our savings in order to save up for the down payment, in order to afford the house, what would that look like? And how much would that change our trajectory? Because what I don't want you to do is be so far ahead of the curve. And then you make this life decision and then you end up drastically behind the curve.

• 54:44Speaker 03

  You've got to make sure that doesn't happen, but I'm all for people living their absolute best life today, so long as they're not sacrificing the ability to also live their best life in the future.

• 54:55Brian Preston?

  Well, I think that's why, that's the balance you just said, is they're ahead of the schedule right now. Nothing wrong with you running scenarios where you take a little bit of that capital to boost the down payment. So it fits within our, you know, our, our 25%. But then also run at the other side to, if you're planning on leaving the workforce at 55, 60 years of age, let's make sure, what do you need to have so that you don't cut it to the bone? We want you just to, to basically have a little, you, you, you're, you're, you're cutting a little bit off of, out of your resources to make this life goal happen, but you're not cutting it so close that you, when you prune the bush, that it actually doesn't grow back. So that's, that's the delicate balance you have to do. Nothing wrong with you pruning and using your assets to live your best life.

• 55:39Brian Preston?

  Just make sure you don't cut it so low that, that, that you've now jeopardized something that you were ahead of the curve and even potentially on an easy street for life.

• 55:47Speaker 03

  Now, now this is one of those areas where when I hear this question, the word immediately comes to my mind is, man, you're making a big decision that likely has a lot of gravity to it. Man, the, The consequences of this decision, if made correctly, can be huge in terms of how much life we get to enjoy. If made poorly, it could be detrimental in terms of what it costs. There are extenuating factors where maybe you don't know what you don't know, and you're unclear about what variables and how to test it and how to stress test it. This is one of those things that you may very well be at that point in place, where having a professional, having a guide, having an advisor on your side, helping you navigate and weigh this decision and how it might play out and what it might look

• 56:31Speaker 03

  like, could be hugely valuable. It's one, to either validate or devalidate the decision. And then two, if it does work, to give you the encouragement, yes, do this. Yes, it's okay. Yes, spend the money, live the life, make the improvement. Sometimes it's great just to have someone in your corner, giving you that confirmation that, okay, I can do this, and I'm still gonna be okay.

• 56:56Speaker 04

  Great thoughts. You know, you mentioned your 25% rule on housing. If you're curious about how to stay within the Money Guy guardrails to buy a house, go to moneyguy.com/resources. We have a home buying calculator and a home buying checklist that you can download. Both of those are completely free. It'll give you some more insight on our 3-5-25 rule for buying a home. And I think that you'll find it very helpful if you're thinking through how to do this the smart way. And even some of these more advanced areas of like, how can you get it within that window in the situation we just talked about, where they had some cash and some things to consider. So, moneyguy.com/resources, just wanted to throw that out there. Before we dive into a final question, if you guys are ready for it.

• 57:41Speaker 03

  All right. Oh, no, I got one more.

• 57:42Speaker 04

  Your workout thing. Your workout thing. I was ready to get back to personal finance. Sorry.

• 57:49Speaker 03

  I still think we should answer one more, though.

• 57:51Speaker 04

  That's all we can do.

• 57:52Speaker 03

  Yeah, I just want to say it's so interesting.

• 57:54Speaker 04

  This is a both and situation.

• 57:56Speaker 03

  You know, obviously, this is a personal finance show, but we care about health. Obviously, we talk about it a lot. Brian has made tremendous strides for his health over the past couple of years. I've tried to do the same thing because health is wealth. It matters. We want to be able to live as long as we can, as well as we can. And so I'll work out every morning with some dudes. We call our gym Third Base. It's the dudes at Third Bay that work out. It's so funny. We talk about this sort of casually enough and tangentially. You guys catch on to it. And so yesterday, a package shows up and our administrators open and they say, guys, what did y'all order? What did y'all? And I kind of saw it and said, Brian, what did you order? And he looked at me and said, what did you order? And we opened it. It turns out it was one of you. One of you actually said, hey, guys, yeah, here's a picture of it. That's it.

• 58:38Speaker 03

  You guys said, hey, I just love so much that you guys talk about our health is wealth. And I happen, here's my, the guy that wrote, he's one of the owners of this company. He said, hey, I made some really good financial decisions and I was able to become an owner of this company. And I just, you guys have added so much value to my life. I want you guys to stay safe when you're lifting. And they sent us a bunch of workout gear. And I just think, I think that's awesome. I think that it's amazing that you guys recognize that the stuff that we talk about here, the financial stuff and even some of the other stuff, it really is about living your best life, the best version of yourself that you can be. And so he sent that and he sent an incredibly nice letter and write up with it. And I just, that's awesome. That kind of stuff makes us so happy.

• 59:20Brian Preston?

  It's the first time I saw the poll results. How was that not like 95, 5%?

• 59:25Speaker 03

  Well, I didn't.

• 59:26Brian Preston?

  Who thought I was going to get excited about those things?

• 59:28Speaker 04

  On Instagram, at Money Guy Show, if you want to follow.

• 59:30Brian Preston?

  I do. When I go to the gym.

• 59:33Speaker 04

  Who do you think is more excited to use the equipment, Brian or Bo? And it was like a pretty high, well, I just.

• 59:38Brian Preston?

  It was like 60, 40.

• 59:39Speaker 04

  Yep, 60, 40.

• 59:40Speaker 03

  Yeah, you, you're not excited about.

• 59:43Brian Preston?

  Bo, I think we know who actually lifts weights. To where they need a belt on versus, and then you like, you even knew what the stuff was like, oh, this is, you can do muscle ups and pull ups. So I was like, I don't even know what that is. And then Marcy and I had to go and look at the ankle thing so that you can strap more weights on. What I don't need when I'm doing a pull up is more weights. I mean, I'm trying, I'm giving it all I got just to get what I got up. You know, I don't, I don't need to add more to it.

• 1:00:14Speaker 04

  I agree, this is a very Bo coded package we receive, right? But Brian believes health is wealth, too. You've had a go on, you are very health conscious, very active.

• 1:00:23Brian Preston?

  Where we're doing a lot of cardio, we're doing some dumbbells. We're doing the treadmill, but we're not, we're not out there doing Olympic lifts.

• 1:00:30Speaker 04

  Just trying to throw it in the air.

• 1:00:31Brian Preston?

  On days that I find out there's burpees, I'm like, oh, maybe I need to go to the restroom.

• 1:00:35Speaker 03

  I'm gonna go walk today.

• 1:00:36Brian Preston?

  Or get a water, water break, you know, during that burpee segment.

• 1:00:40Speaker 03

  That's hilarious.

• 1:00:41Speaker 04

  Oh, that's good stuff. No, I'm glad you went back to that. That was good. All right, do you want to do one more question?

• 1:00:47Brian Preston?

  Final question.

• 1:00:49Speaker 04

  This is a fun one. It says, hey, Money Guy team, if you could go back in time, is there anything you would start spreading the word about earlier? And I'm thinking personal finance related.

• 1:01:00Speaker 03

  Yeah.

• 1:01:00Speaker 04

  Of course.

• 1:01:01Speaker 03

  You know, well, I have, okay, I have one, but you want to go first? I have one immediately that just hit me.

• 1:01:05Brian Preston?

  Well, I mean, realize, I mean, I really do love index funds and Roth accounts are something I'm pretty, pretty passionate about.

• 1:01:16Speaker 03

  Yeah, but I'm going to say you've always been passionate about those. So for those of you who don't know, Brian started this podcast back in 2006, 20 years ago.

• 1:01:24Speaker 04

  Honestly, you start sharing things you were passionate about pretty early.

• 1:01:27Speaker 03

  Yeah, and so he was sharing index funds and Roth. Here's something I wish we could go spread the word about earlier. It wasn't until a number of years into our career that we actually synthesized and figured out a clean way to communicate the financial order of operations. It always kind of existed, you know, we, it was the amalgamation of like our experience and working with clients and being able to like put the information together. But that, it wasn't around in that form in 2006. And man, if we could go back in time, I think it would have been cool, starting in 2006, if we could have started like.

• 1:02:03Brian Preston?

  The purity of this is much better because it's, there's, there's lots of, there's, you talk about 10,000 hours to become an expert, there was a lot of, you know, really getting in the weeds to get this done. The, the origin story on the financial order of operations, if you remember, was the 30 minute financial plan. We did that show every year. You know, it probably came about, what, because you were on the show then, Bo, so it was probably 2010. Where the food came on? You know, no, the 30 Minute Financial Plan. Oh, that was like 2011. 2011, 2012. And then we kept doing that show and then finally we were like, you know what, we go through the mindset or the order and then it hit us when I saw that LinkedIn post on the, please excuse my dear Aunt Sally.

• 1:02:48Brian Preston?

  And I was like, you know, this is, we ought to own, because there's a financial order of operations as well. And I agree, that would have been better even if it came out even sooner.

• 1:02:57Speaker 04

  I do love that though, because it goes to show you like, the financial order of operations is truly baked in like, tons of your life experience, tons of your client experiences, like it was a long time in the making.

• 1:03:09Brian Preston?

  Well, that's why, that's why I love, you know, and by the way, this is probably a great way to close it too. And I still am reading the Amazon reviews, I mean, and the Goodreads reviews, because a lot of you are like, I don't know, I wonder if he's still reading, or, yeah, I'm in there.

• 1:03:22Speaker 04

  He doesn't scroll his phone, he just scrolls Amazon.

• 1:03:25Brian Preston?

  And you guys, y'all made me so happy because, I mean, it feels like the book, as well as the Financial Order of Operations are changing folks' lives for the better. And I know that that's all driven by what we get to do with y'all on the wings, whether that's in the theater or on the airplane.

• 1:03:41Speaker 04

  Either way.

• 1:03:42Brian Preston?

  And I appreciate y'all being my, you know, co-pilots with me, or while riding first class.

• 1:03:51Speaker 04

  That's true. Am I a co-pilot or am I the pilot?

• 1:03:52Brian Preston?

  You're the pilot.

• 1:03:54Speaker 04

  I think, okay, so you kind of like stepped out of the cockpit and said, here, Rebi.

• 1:03:58Brian Preston?

  Here, you take this. This is, let's just say, this is a private jet so that you're not locking the cockpit to make sure we don't come out there. We have free access to come from first class up into.

• 1:04:07Speaker 04

  Okay.

• 1:04:08Brian Preston?

  Or we're like Southwest, where all seats are first class. Every seat on Southwest is first class.

• 1:04:13Speaker 04

  Well, this analogy is getting way too deep, but I do, I do like it. I appreciate everybody being in the wings so that we can make this show for you. And we'll be back every Tuesday at 10 a.m. Central, live streaming, along with lots of other original content throughout the week. So be sure to subscribe wherever you're listening. And we will continue to show up here on the Money Guy Show channel with brand new content, talking about what matters to you, about your personal finance, and hopefully just helping you build that confidence. So you can focus on what really matters and not just stay in the weeds or in the anxiety of personal finance. That's what this is all about. So be sure to subscribe and visit moneyguy.com/resources for all that free stuff we talk about that we have made for you to help continue these conversations.

• 1:04:57Brian Preston?

  I'm your host, Brian, joined by Mr. Bo and the rest of the Money Guy crew. Money Guy, out.

• 1:05:04Speaker 04

  The Money Guy Show is hosted by Brian Preston and Bo Hanson. Brian and Bo are partners with Abound Wealth Management. Abound Wealth Management is a registered investment advisory firm regulated by the Securities and Exchange Commission in accordance and compliance with the securities, laws, and regulations. Abound Wealth Management does not render or offer to render personalized investment or tax advice through the Money Guy Show. The information provided is for informational purposes only, may not be suitable for all investors, and does not constitute financial, tax, investment, or legal advice. All investments involve a degree of risk, including the risk of loss.

• 1:05:40Speaker 05

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