Do THIS to Fix Your Finances in 2026

Your net worth is one of the most important numbers to understand your financial picture. We're not talking back of the napkin math, we are talking about finding the exact number you're at right now to get a handle on where you're heading for the future. After that, we're answering your financial questions and that's right - it is a TUMBLER DAY! ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠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.

• 0:00Speaker 00

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• 1:06Brian Preston?

  What if I had a universal Swiss Army knife of personal finance that will transform your year end?

• 1:13Speaker 03

  Brett, I am so excited to talk about this because this is literally something when someone says, hey, where should I start on my financial journey? What tools should I use? What things should I be thinking about to kickstart me no matter where I am? Whether I'm at the very beginning of my journey, even if I'm well into it, what tools should I use? This is the tool that I always tell them.

• 1:33Brian Preston?

  So all of my financial mutants are right now saying, I can name that tune with one note. And they know we're talking about the net worth statement.

• 1:41Speaker 03

  That's exactly right. It is the statement that gives a detail of where you are right now currently in your financial life. Because how on earth can you know where you're going? Or how can you know if you're even on track to get there? If you don't know where you are today? If you don't know what your starting position is? And that's exactly what a net worth statement does.

• 2:01Brian Preston?

  How about since I've already kind of broken the seal and made this into a game of saying, name that tune? Let's play a little game here of Bo. Is a net worth statement, is there like an age restriction for this?

• 2:13Speaker 03

  Nope, no age. So the question like, so who, who, okay, no age restriction. Who should do it? It's people at any age. So whether you are an 18 year old just now graduating high school, or you are an 88 year old in financial independence, you should do a net worth.

• 2:28Brian Preston?

  How about, is there like a, it's a season of life, like maybe after you get out of debt and you actually start saving and investing, is that when you should actually do a net worth statement?

• 2:38Speaker 03

  Yes, and yes to every other stage, any other age and stage of life, whether you are single, no kids, just starting in the workforce, or maybe you are deep in the messy middle with a gaggle of kids and a thousand different things pulling you in a thousand different directions, you should be doing a net worth.

• 2:54Brian Preston?

  And I think you guys are catching on. It doesn't matter if you're deeply in debt or you're knocking things out of the park. And it doesn't even matter if you're at your entry level, right out of college, first job, or if you're absolutely crushing it. This is also good at any income level. So let's talk about what is a net worth statement? Because some of you, we realize that 40% of our audience is constantly coming through this door, trying to figure out what is personal finance. We ought to probably take them back to the basics of what is a net worth statement?

• 3:24Speaker 03

  Yeah, essentially, when you put down your net worth, what you're trying to get a hold on, what you're trying to get your head wrapped around is, okay, what are all the things that I own, the assets that I have, and then what's all the money that I owe, the liabilities that I have incurred? And if I take what I own and I take away what I owe, that gives me my net worth. That tells me where I'm at today. And a lot of folks starting out, Brian, they do this, oh man, I don't own a whole lot and I owe a whole lot because maybe I have an auto loan, student loans and other things. That's okay. That's not necessarily a bad thing. Even if you have a negative net worth, you should start tracking it today.

• 4:02Brian Preston?

  I want to go through this next section pretty quick because I want to go a little deeper into what is what you own? What is the debt components of what you owe? So we'll go through this and then stick with me because I need you guys in the audience to understand why this is so valuable. And we'll kind of give some color to that. That's why this. This is one of our favorite times of year to use this as a tool to shape your financial life and be that much better for it.

• 4:25Speaker 03

  So when you think about listing out the things that you own, here's some common stuff that you might find in your net worth statement. You might find the value of your cash accounts. So this is checking accounts, savings accounts, money market accounts, high yield savings accounts. You'll also list out all of your investment accounts and that's across all three buckets. Your after tax accounts, your tax deferred accounts like 401ks, 403Bs, your tax free accounts like Roth IRAs. You'll list out any business interests that you own. If you're a small business owner, maybe you have a side gig that has some sort of enterprise value. You'll list out the value of your real estate. So this is not only your primary residence, but also like rental homes or other type of rental property or real estate properties that you own. And Brian, this is one we get a lot of questions on and this is something that's a little unique about

• 5:10Speaker 03

  the way that we tell people they ought to think about their net worth statement because we hear this all the time. Guys, I've got my house, but how should I mark this? What should I put down for the value of my home on my net worth?

• 5:21Brian Preston?

  Now, look, a lot of people don't like this, but it's more of an accounting principle that I've just used forever is that I use the lower of cost plus improvements. And the reason I do this is because this is a use asset. I mean, one of the worst things, it's just like right now, I'm sitting on tons of home equity, but the only way I could unlock it is that I have to sell the house or go take out more debt, which is not something that I think is a viable solution. So if I was counting on, if I was trying to figure out, do I have enough net worth or enough assets behind me to support me so I don't have to use my labor or time anymore, I would have a false sense of comfort if I was just basing it off of home equity.

• 6:01Brian Preston?

  Because we live in an area that's just had a huge run up in value of houses, but it's not usable unless I actually liquidated or took out debt. And that's just, that's no go land for me right now.

• 6:13Speaker 03

  And we want to be careful allowing too many things that are outside of our control to influence both positively and negatively. The things that we see on our net worth statement, we can control our savings behavior. We can control what adding to our investment accounts. We don't necessarily get to control how much our house increases in value in any Year, two-year, five-year, 10-year period. And just like you said, it's a used asset. So we like to be super conservative in that, even recognizing that if you do that, there's a really good chance you're understating the value on your net worth.

• 6:42Brian Preston?

  Well, and think about this, I'm kind of jumping ahead to, but think about the years, we had the crazy distortions in real estate. We'll have a version to the mean on this, but, but the fact that most real estate goes up like inflation, 3%, 4% a year. We've had periods post pandemic where it was like a 10%, 15%. If you looked at your net worth statement in those years, what if you were saving 15% with the goal of trying to get to 20%, but because you had a huge run-up in your primary residence, you would have a false sense that, hey, I made a gazillion dollars last year because my house, it wasn't because of your behavior. And I think that that skews your dashboard view

• 7:24Brian Preston?

  as the kind of executive of your personal financial situation. It's not good information that you can actually control.

• 7:31Speaker 03

  All right. So we've talked about the things that you own, the asset side of the equation. Now let's talk about what goes on what you owe, the liability side. This is going to be things like consumer debt. So maybe you have a credit card balance that you're trying to knock out, you're trying to get rid of. That would go on the what you owe. It'd be personal loans, auto loans, other types of debts. Maybe you have student loans or home equity lines of credit or mortgage balances, or the value of mortgages on rental properties. Any debt that you owe, any amount you have outstanding would go on the what you owe column. And again, if you can list everything in your life in these two columns, and you take what you own minus what you owe, that's what delivers to you your total net worth.

• 8:13Brian Preston?

  So the question is, why bring this up now? Well, we've already, this is the big time for us is that we love closing out the year end is because it does mean it's the annual tradition that Bo and I have is to do our net worth statements. And here's the thing, we actually, the tool that we offer to you guys are, if you go to learn.moneyguy.com is the exact tool that we use for ourselves.

• 8:34Speaker 03

  Every year.

• 8:35Brian Preston?

  And I absolutely love this tool because it really does give you that dashboard view. Can compare, how's my liquid net worth doing? How is, how much debt am I paying off? You know, how much am I a high accumulator of, of, of the assets? A prodigious accumulator? We have all these things built into the actual dashboard. So you can kind of go in there, see how well you're doing and navigate this journey to abundance. Because that's the thing, a lot of people will have this tool, but not know how to use it. But Bo, I, I almost feel like I'm selling a, a, was it Shazam? Or whatever the thing that goes like, wait, there's more Shamwow. Shamwow and the fact that, yeah, I know, I never get it right.

• 9:18Brian Preston?

  But right now, we, we think, most people think Black Friday, Cyber Monday. We actually have Brian's birthday.

• 9:24Speaker 03

  That's it.

• 9:24Brian Preston?

  So we've actually expanded these sales right now. We're, we're giving, and I don't want to screw this up. Is, are we doing 20% off right now?

• 9:31Speaker 03

  20% off.

• 9:32Brian Preston?

  So if you go to learn.moneyguy.com, all of our products right now are 20% off. Cause we've gone ahead and we want the birthday celebration to extend to you guys too, for, for another day. So you can get in there and do this financial mutant style, not Gangnam Style, but financial mutant style and get that discount.

• 9:47Speaker 03

  Well, here's, here's what I love about the net worth tool that we designed. One, this is something that we've used for years and years and years and years. Like, man, if we use this so much, we want to make this available to our financial mutants. You guys in the chat, cause I can see the chat coming in, you're super intuitive around the questions you're asking. Oh man, guys, I don't even, I'm going to some of this stuff. I don't even include my primary residence on my net worth because I can't use it. It's not, that's one of the reasons why on the very front of the dashboard, not only to track your total net worth, we track your liquid net worth. What part of your portfolio can you actually, what can you turn into living expenses? You also mentioned some of the stuff on here about, okay, well, how effective am I using my shovel? How effectively am I turning my income into my army of dollar bills?

• 10:31Speaker 03

  We actually have a thing on the dashboard that shows how powerful that will be. Some people even asked in here about, hey, what about cars? Why, why, you guys didn't mention automobiles on there. You can actually list, maybe you're someone who has cars, collectibles, art, jewelry, weapons, whatever the thing.

• 10:50Speaker 03

  is for you that would find a place in your net worth statement, you can track that if you so desire on there. But on their dashboard, on the dashboard, on the dashboard, it actually removes.

• 11:00Brian Preston?

  Dashboard.

• 11:01Speaker 03

  It removes some of that stuff. So you can focus on how am I actually building towards financial independence year over year over year. I get so frustrated, Brian, when I talk to someone that, yeah, man, but I just, my net worth isn't impressive. Yeah, I got, I got a thousand bucks in my Roth IRA and I've got student loans and that, and I'm like, that's awesome. If you can start tracking it today, you will be amazed at how much ground you can cover in one year. You'll be blown away by how much ground you can cover in five years. And you will not even believe how much you can cover in 10 years, but you won't know if you've not started tracking it, actually putting a line in the sand a day to start that journey.

• 11:42Brian Preston?

  You know, I've often shared it because I'm very transparent. Um, I've always been jealous that Bo started this from ground zero. Really, you know, graduate college, you're doing the net worth. It took me until, I, I didn't start this until 2006.

• 11:55Speaker 03

  So well into your career.

• 11:56Brian Preston?

  I mean, so yeah, I've got 20 years of history, but man, I always wish I'd have had the beginning, beginning parts because we've used this. As I was writing Millionaire Mission, I, what's funny is I was going back and looking at my net worth statements just to make sure that transparency policy, no hypocrite policy that I have was making in another way where I use the net worth and then we'll, we'll move on. His communication tool, we both live in households where we have awesome spouses that are brilliant, but they don't want to be the financial people. So we, we have taken, we have taken this to use this as a communication tool. So not only to, my wife knows where this is if I was not here, but also we use this in our annual, we take, do a whole date day.

• 12:41Brian Preston?

  And I, I think I stole this from you, Bo, where I actually will put it on the calendar, well, I'll skip work that day. And we go hang out in coffee shops, go have a restaurant lunch, and then even do a dinner that night. And a big part of this is planning around what is the dashboard from the net worth tool say, what are our goals for next year? What did we say we wanted to do last year and we've reviewed this? This is a superb communication tool, especially if you have a non-financial spouse, because it just brings everybody up to speed. So you have that executive summary tool to make sure that we're doing this together. That it's not just a one-person show. It's actually, we're doing this together because two becomes one.

• 13:21Speaker 03

  I love that. I love that we get to sit in this spot. We get to share the tools with you that we're using in our own personal finance journeys. And we get to tell you all of the ways that you can do money better. We love it so much that every Tuesday at 10 a.m. Central, we like to show up right here and answer your questions, load you up with information. So if you have a question you want us to weigh in on right now, we have the team out in the wings collecting your questions. And we do indeed want to load you up. So make sure you get your question in the chat. With that, Creative Director Rebe, I'm going to throw it over to you.

• 13:56Speaker 04

  Yeah, we're going to kick it off with Dell Mink's question. It says, is investing in the total stock index worth it for diversification rather than just the S and P? So maybe you can define some of these terms and give some thoughts.

• 14:12Brian Preston?

  I mean, they're very similar. I mean, the overlap is high correlation. The difference is the total market's going to have some small-cap, mid-cap bleed over that if you want to have more control on that, because you guys, we love index funds, but you will get to the point of, this is why we've also talked about index target retirement funds, is that if you want to get beyond just primarily large-cap U.S. companies, you kind of have to expand that envelope of what diversification means to you. And that's what, there's nothing wrong with the total stock market index. I've used it for education accounts. I've used it in other things where I was looking for a little something beyond just the S and P.

• 14:56Brian Preston?

  But there's not a huge difference. There's a lot of overlap.

• 15:01Speaker 03

  Yeah, so you've already mentioned, we love like target retirement index funds when it comes to folks to kind of just starting out. And what we would call, we call that a generalist fund. There's a general mandate that that tries to employ when it comes to investing. Well, total stock market funds are kind of like that as well. They're sort of like this generalist fund. They just want to get you all equity exposure. If you're looking at like a total market U.S. fund, they want to get you all equity exposure. As your investing life changes and as you kind of mature into the place to where now maybe employing some different tactics might make sense for you, you've reached that critical mass, we do generally like to move away from generalistic funds. We want very specialized

• 15:42Speaker 03

  funds. And what I mean by that is, okay, if I want US large cap exposure, I want to go buy a US large cap fund. If I want US small cap exposure, I want to go buy a US small cap fund. And I want that one fund to do one thing very, very well. Early on in your journey, you kind of want the funds that you have in your portfolio, whether it be a total stock market index or a target retirement index, you want to do a bunch of things really well. As you progress as an investor, you want the individual parts and pieces to do something really well. So I want my real estate fund to do real estate very well, and small cap to do small cap, and developed international to do that, and emerging to do that. And you kind of build it that way. Well, one of the other benefits that you have

• 16:21Speaker 03

  when you move into something like changing your strategy across your domestic equity exposure, is then you can unlock stuff like loss harvesting. Oftentimes, small cap funds might move in a different direction at a different speed than large cap funds. Well, if you hold individual funds, you might be able to loss harvest, you might be able to rebalance and take advantage of those movements. When you buy a total stock market index fund, you lose some of that flexibility to be able to do that. So, the answer to your question, Delmi, is it really depends on where you are in your financial journey. Are you at the place where having a more sophisticated, more well-thought-out investment strategy really makes sense to where the juice is worth the squeeze? Or are you someone who's

• 17:05Speaker 03

  still pretty early on in your journey where you don't really need to focus on all that stuff, it's more minutia, and you should just focus on the two main things? How much can I save? And what accounts should I be putting it into?

• 17:16Brian Preston?

  So the notes I had written, I think you're spot on generalist. You don't, you know, if your account's not big enough to worry about, that's perfectly fine, but you have to realize when to specialize. And then I wrote down three quick things that you kind of said about, I think it's worth highlighting. The big things you're walking away from by staying in a generalist portfolio is you lose the power to rebalance. You lose the power to loss harvest. You lose the power to give away highly appreciated assets. I mean, you could give away the total, but when you segment between different asset groups, you could, if a small cap knocked it out of the park, you could give that away. Or if it, if small cap got its teeth kicked in, you can loss harvest that versus on a total market.

• 17:58Brian Preston?

  It might be all grouped in together. So it's a little bit harder doing that in a generalist format.

• 18:04Speaker 03

  Love it.

• 18:05Speaker 04

  Good stuff. And don't make it's your lucky day because today is Tumblr day.

• 18:09Brian Preston?

  Oh, wow.

• 18:11Speaker 04

  Everyone's favorite day. That means if you email.

• 18:13Brian Preston?

  Quack, quack, quack, quack. That was slow motion style. You know, we did that at point six speed.

• 18:19Speaker 04

  I think that was straight up duck.

• 18:21Speaker 03

  That was.

• 18:21Brian Preston?

  Well, I mean, I would, I don't want to.

• 18:23Speaker 04

  We're not even trying for transformer anymore.

• 18:25Brian Preston?

  More metallic. Is that better? Is that a little more like the transformer show?

• 18:30Speaker 04

  That was more what I was used to. But yes, these kooz, these tumblers can transform into a koozie as well. And if we answer your question live today.

• 18:41Brian Preston?

  Both formats.

• 18:42Speaker 04

  Just email winner at moneyguy.com and we will send you one.

• 18:45Speaker 03

  You know, one of my favorite thing, Ruby, about doing, about doing this show, about being here, getting to sit in this spot. I never know what Brian's gonna say. I mean, sometimes I can guess and sometimes I can be there. I don't know. Did you watch the react video that went out yesterday?

• 19:00Speaker 04

  Yes, I did.

• 19:01Speaker 03

  Did you see that?

• 19:02Speaker 04

  Was so fun.

• 19:03Speaker 03

  Unhinged and it's because.

• 19:05Speaker 04

  In the best possible way.

• 19:07Speaker 03

  Never know what's gonna come.

• 19:08Brian Preston?

  What's funny is people ask, do we watch our own content? I'm like, not generally, but reacts I do. Because I want to see what the content team has done to us. Cause we don't see it like when it, when it gets published. I like to say we're such good managers that we're like saying, hey, send all the roles to us so we can watch it before it goes hot. No, we just let the team let it rip. And so when it goes public, I'm like, well, let me see what they did to us. And the, the video editors crushed it. It was, it was pretty awesome. I thought it was even funny that they brought Caleb in as kind of like the Charlie Brown voice. In the backgrounds on things. It was good stuff.

• 19:47Speaker 04

  Yeah.

• 19:47Brian Preston?

  Well done.

• 19:48Speaker 03

  So if, uh, if you're not subscribed to the channel and you're not getting updates when we have a brand new Making a Millionaire come out, or a brand new React come out, make sure you subscribe right now so that you can get those notifications to know when we are releasing fresh, new content for you.

• 20:04Speaker 04

  Absolutely.

• 20:05Brian Preston?

  No, I, I saw those comments. People were like, you can tell Bo doesn't know what Brian's gonna say. And that's, we all know our roles.

• 20:15Speaker 04

  All right, let's move on to Skylar's question. If each spouse needs a car, how does that affect 238 rule?

• 20:24Brian Preston?

  Not gonna like my answer.

• 20:25Speaker 04

  Hmm. Well, here's the rest of the question. Does each car individually need to follow 238? Should each car only be 4% of the total monthly income so that they add up to 8%? I think this is a great question.

• 20:38Brian Preston?

  Let me give the hot take, Bo, and then you can put the-

• 20:40Speaker 04

  And can you explain the 238 rule real quick as well?

• 20:42Speaker 03

  Well, can I, can I just give one little, small piece of advice? Cause I want, you said you got a thing. Uh, so much as you can control it, whereas you can control it, one thing that we've seen both in our personal lives, as well as in the lives of our clients, if you can stagger automobile purchasing decisions, it often works out a lot better. I'm always amazed when I have friends and, uh, you know, one spouse will get a new car in February and two months later, the other spouse gets, I'm like, guys, why?

• 21:10Brian Preston?

  It's not a competition.

• 21:11Speaker 03

  Why don't we just spread this out a little bit? So if you can spread it out and buy cars on a different schedule and a different timeline, often that's more advantageous from a financial standpoint. But undoubtedly, Brian, life happens and sometimes we have to be in that place where we have to buy two cars. We have to have two payments at the same time. And I think that's where Skylar's going is how do I navigate that?

• 21:32Brian Preston?

  Well, I mean, the, the way the rule is designed is it's supposed to be 8% total. And that's why you're staggering is such-

• 21:39Speaker 03

  Across all car payments.

• 21:40Brian Preston?

  Is such a valuable thing is because the ideal thing is you don't do this all at once. Now I realize people are gonna quickly do the math based upon your income and be like, holy cow, that's just, if I had to do this for two cars. That means one of these is either going to, they're both going to be not great cars, or one of these is going to be a beater. I mean, yes, it creates some hard decisions, but that's why I would spread this out as much as possible. And then it also, it puts pressure because what if you did get stuck with the emergency situation where, you know, you got in a car accident and you had a gap from the value because maybe you had some negative equity and you had to buy two cars in a very short period of time. I want this

• 22:21Brian Preston?

  rule to create the pressure so that you will do dynamic things to get yourself back on track as fast as possible. Cause you, I recognize you might have to go outside of this, but I want this to feel like a weight on you to get back on track as soon as possible.

• 22:37Speaker 03

  And if anyone out there who's ever had two car payments at the same time, or if you have two, it just kind of stinks. Like it's a, it's a hard thing. That's why, one of the things we love, and you can just think about this mathematically, if 238 is 20% down, I don't finance for any more than 36 months or three years, and I don't spend more than 8% of my monthly gross income. But if I drive cars for seven years, that means that I pay off the car in three years and I get to drive it payment free for four years on average. If I can stack my payments instead of having two payments at the exact same time, it's going to give me a lot of reprieve in my monthly expenses, my monthly spend, which I think is a huge benefit if you can do that.

• 23:17Brian Preston?

  And the why is, look, cars are napalm for your personal finance. They are absolutely, that's where it's, when people talk about the latte effect, I'm like, it's the car payment is usually the first huge mistake I see people making, even beyond student loans. It's the car, they go out there and they buy a car way too, too much debt. That's why when we react to these Steve O's got me rolling, and I see all these people with thousand plus car payments, it breaks my heart. Because, and that's what, but here we are, we speak out of both sides of our mouth, but with purpose. And the fact, because I'm telling you, these things are napalm for your personal finance. But then I'm over here with an open hand saying, look, I don't want to have a hypocrite.

• 24:02Brian Preston?

  I don't want to be hypocritical myself in the fact that I knew the only way I could get to my first job was through car debt. So I could actually start this, building this financial empire was I had to get to my job. So that's why we gave you 238 is because we recognize these things are horrible, but we're going to try to give you some grace and some, some flexibility by taking on debt, but you have to be scared. If you, that's why this will also hopefully keep you humble and create character building where you drive a car that's not as nice as maybe you want and your ego wants and what your coworkers and your peers have. That's okay. That's why we say think Corolla, not Land Cruiser is

• 24:42Brian Preston?

  because we're trying to keep it as reliable, basic transportation until you actually are a level eight or beyond in the financial order of operations. And then you can go crazy and do the Dave Maserati or whatever you want to do.

• 24:57Speaker 04

  Good stuff. All right. Well, Skylar, thank you for that question. If you would like a Money Guy Tumblr, just email [email protected]. Next question is from Nathan B. Our savings rate dropped from 26% to 19%. I can't include the employer match anymore.

• 25:16Brian Preston?

  Congratulations, Nathan. Got a big old pay raise.

• 25:22Speaker 04

  I know. This is a great problem to have. He goes on to say, you often recommend getting serious about reaching a 25% savings rate in your 30s. How aggressive should we be about getting back to 25% while balancing other goals? And how does the early retirement plan change the equation? There's a lot there.

• 25:43Brian Preston?

  Oh, man, there is so much to unpack. Cause what Nathan didn't give us was, he's obviously in his 30s, but he didn't tell us what his current age is. And I don't know when he started investing because when we, if you go to moneyguy.com/resources, we do have what you should save. Is that, did I name it always? How much you should save? How much you should save? Look, I'm getting close.

• 26:03Speaker 04

  That was very close.

• 26:04Brian Preston?

  I mean, obviously if you started saving, investing, you know, 20 or younger, 10, 15% does amazing things for you. Unfortunately, the typical American doesn't start saving, investing until they're 36. So that's where the 25% comes into play. So Nathan, you might be, if you started young enough, you might be okay at 20%. But what, and this is why, but you then threw in a curve ball. You said, but we might want to retire early. Well, when you have big obligations that you're putting on your financial resources, where you want to quit using your time for labor and you want to start using it on your terms, you better save like a son of a gun. Because I mean, that's where we see the FIRE movement, the dirty little secret for the

• 26:47Brian Preston?

  FIRE movement, or FINE movement, if you want to go the next endeavor instead of retire early, is that this is why these people save 40 to 50%. It's because if you're going to drop out at 45, 50, 55 years of age, you better build up your nest egg that much sooner. So you can have that flexibility that much sooner, too.

• 27:07Speaker 03

  All right, let's think about this pragmatically, because your question is, how aggressive should I be getting back to 25%? Well, we know that money is nothing more than a tool that allows us to accomplish our goals. So step one, you need to list out what all your goals are, right? What are my goals right now, today, in my 30s, in what sounds like potentially the messy middle? What are my goals for early retirement? What are my goals long term? Then you have to assess, okay, where am I in pursuit of those goals? Has the savings rate we've been on caused us to really miss out on some life stuff? And now that I've gotten this pay raise, where I can't include my employer match anymore, I'm now able to do some of those short-term life goals, and that's going to eat up some of that new pay raise? Or have I been doing that, and I can begin saving this, and I need to deploy the

• 27:50Speaker 03

  dollars that way? And then how much have you built towards those goals, whether it be financial independence or whatever? So you have to define, okay, I have these five different goals I want to achieve. I am 60%, 70%, 20% of the way towards each one of those goals. The answer to those questions will then dictate how aggressively you need to get back to 25%. And there's a great tool that we have that could help you. If you go to learn.moneyguy.com, do our Know Your Number course, because one of the things that's going to help you define is, okay, what is my finish line? If I know that I want to be financially independent at 50 years old, and I need to have $5 million, and based

• 28:32Speaker 03

  on my current savings, I'm getting there no problem, then, okay, maybe I can just stay at my current Savings rate, then I can focus on funding some of these other goals. If however, I have a shortfall and I'm not there yet and 20% won't get it done, or what do you drop down to 19% won't get it done. Maybe then I do need to increase my savings rate back to 25% to make sure that I can get back on track. So there's some homework you have to do to triage your situation to determine what the best path forward is.

• 29:00Brian Preston?

  You're, you're spot on with the dough, your number, but I do think we got some additional information. Just came across the line here is Nathan is 28. They already have one and a half times their income already saved.

• 29:12Speaker 04

  Their new income.

• 29:12Brian Preston?

  And, and this is their new income, which by the way, we know for a married couple, the rule where you don't get to count matching is $200,000 and greater. So wowzer, you know, this is Nathan, you are crushing it. Congratulations. Well done. And, and by the way, don't forget on the work with us.

• 29:32Speaker 03

  I was only gonna say.

• 29:36Brian Preston?

  We can get you from the financial mutant survey to the client survey very quickly. Um, as we're tracking this data with, with that type of course and trajectory that you're on.

• 29:45Speaker 03

  That is moneyguy.com slash become-a-client.

• 29:51Speaker 04

  Wow, you knew that one.

• 29:53Brian Preston?

  It's funny you say, I never know what to do when I'm giving the work with us is because it is a weird, you know.

• 30:00Speaker 03

  In the URL is like.

• 30:03Speaker 04

  You just go to moneyguy.com and click on become a client. It's right there.

• 30:06Speaker 03

  She said it cleaner than us.

• 30:07Speaker 04

  Yeah. Oh, I thought this through. So I thought about where that button was going to go.

• 30:14Speaker 04

  Oh, that's good stuff.

• 30:15Speaker 03

  28, one and a half.

• 30:16Speaker 04

  I know.

• 30:16Brian Preston?

  I was gonna say, cause he said for 30s and I was like, so he's in his 30s, but then he's 28, of course. Financial mutant status, beast mode.

• 30:24Speaker 04

  Beast mode.

• 30:27Speaker 04

  All right. Ready for the next one?

• 30:28Speaker 03

  Did you give him a thing?

• 30:29Speaker 04

  Oh yeah. Nathan, you get a Tumblr.

• 30:31Speaker 03

  Hey, because I'm looking out for you, go to moneyguy.com slash become a client.

• 30:37Speaker 04

  And you can email [email protected] and we will send you a Tumblr Nathan.

• 30:42Speaker 03

  Everybody have a good Thanksgiving.

• 30:45Speaker 04

  I did.

• 30:46Speaker 03

  Sure did.

• 30:46Speaker 04

  Getting some thumbs up from the team.

• 30:49Speaker 03

  What about you?

• 30:50Brian Preston?

  Did, I was, um.

• 30:51Speaker 03

  You get some walks in, are we gonna have, are we gonna have some new tangent, Thanksgiving edition tangent times?

• 30:57Brian Preston?

  You should know, you should know. I went with two, two intentions into Thanksgiving, cause I traveled last week, I was down in Florida. I was gonna read the Reddit thread for the book things that we're talking, that Reeve and I are talking about. And then I was gonna record some, some tangent time.

• 31:15Brian Preston?

  Did I do either? The answer is no. Because, I mean, we had relatives, we, well, first, we had only, we had two day, two, two days? Where it was just the family, but realize when I say the family, my, my oldest daughter actually came with us. And you have to know, if you have a senior in college, you don't get them anymore. I mean, it is, I'm in that sad, you know, I'm, I'm barely in the crumbs of the bag that I'm shaking out of knowing that she's about to do this adult thing. So it was glorious to kind of, we were doing bike rides, we were, you know, hiking, we were, we were going to parks. It was glorious. So I didn't, and then the relatives all showed up on Tuesday. And then it was off to the races. I mean, cause once, you, you know, it's funny.

• 31:59Brian Preston?

  My wife, we'd go to bed at night and she'd go, woo, I am just drained. Whereas I'm like amplified, because I think I'm, this is the extrovert versus introvert. Is cause she's like, every morning you're out there, I'm like, putting casseroles in the oven, I'm like whipping up eggs, you know, making coffees. I mean, I love having a house full of people. It's just, it's, it's fun. So. I didn't absolutely nothing that I was supposed to do, and I'm feeling a little guilty and a little behind now. Cause I'm, cause now I was like, well, I'll just catch up at Christmas. No, I won't, because we have the same problem. I'll have a house full of relatives in the house and I won't do what I'm supposed to. So I gotta get serious about catching up on some of these things.

• 32:38Speaker 04

  So Brian really did have a fantastic Thanksgiving.

• 32:40Speaker 03

  It sounds like it was a great Thanksgiving.

• 32:41Brian Preston?

  No, it was, it was good. And, and I ran into a few of you guys out and about too, and that was always glorious. I had one in Hollywood Studios, we were, we were in the parks in 50's primetime. That was kind of fun. Had another one in a restaurant that I had taken the whole family to. It's too close to my, my house down there, so I don't want to say where that was, but, but it was, um. It was glorious. You guys are always so awesome, um, when we get to see you in public. And I appreciate you making me look cool in, in front of my relatives too.

• 33:11Speaker 04

  That's what it's all about. No, I'm just kidding.

• 33:14Brian Preston?

  You know, it's funny is I don't ever know if people know who we are because we're nerd famous. We're not real famous. You know, it's not like we're Chris Pratt when I went to the bathroom four times, walking past Chris Pratt's table when I saw him in a restaurant one day. Because I know who nobody is, but I knew who Chris Pratt was. But so we're not like that. But it is one of those things where if you watch that Eddie Murphy documentary that's on Netflix or whatever, he talks about that your crazy fans are only like the teenagers and 20 something. Well, we know in our key demographics, I mean, our key demographics are like from 26 to 50 something. These aren't exactly the people that are going to be, you know, Justin Bieber chasing you down

• 33:56Brian Preston?

  the street. So I never know if people know where we are. Oh, oh, look at that. It doesn't make all the sounds anymore, but we just crossed 620,000 subscribers.

• 34:06Speaker 03

  Hey, look at that. That's awesome. Thank you for who, for all of you that actually just subscribed. You did that. Thank you so much.

• 34:13Speaker 04

  We do appreciate it. That's always fun.

• 34:15Brian Preston?

  Okay, we probably ought to start giving value here. Otherwise, people are going to start, the tangent time is going to take people out. So.

• 34:21Speaker 04

  Too tangenty? I do have another question queued up. It's from Hello, Good Friend. It says, when considering the three bucket strategy, is there an optimal bucket that high growth assets like stocks and low growth assets like bonds should go in?

• 34:37Brian Preston?

  Yeah, Roth. Next question.

• 34:38Speaker 03

  Well, no, there's, there were two different.

• 34:41Brian Preston?

  I'm sorry. I'm sorry. I just, I got, I'm sorry.

• 34:44Speaker 04

  The last part was should each bucket just include a mix of both? So expound, Brian. Expound on what you said.

• 34:49Speaker 03

  Here's the answer. Here's the answer. It depends on where you are in your financial journey. If you are someone who is just starting out, very early on in your financial journey, we don't really want you thinking about what's known as asset location too much. We want you focusing on how much can I save? How much can I save? How much can I save? Because what's going to impact your future of financial security more than anything else is going to be your savings around, savings rate and just putting that money to work. So how much can I save? And then where should I put it? We actually have, Brian, can you hold a thing up for me? We actually have a nine step process to help you figure out the most efficient places to put that savings. And you can use things like low cost index funds,

• 35:31Speaker 03

  target retirement index funds, all of those sorts of things. But at some point. You likely will graduate to the point where not only does it matter how much you're saving, but you can actually have some benefits from thinking about how you allocate your assets and how you locate your assets, what type of assets, what types of accounts. And we do have some guidelines and thoughts.

• 35:51Brian Preston?

  That's why the best, most improved chapter when I was writing this book was the step seven, hyper accumulation. If you look at Millionaire Mission, because exactly what Bo says, most important thing in the beginning, that's why I steps one through six is to keep your life out of the financial ditch and then to focus on the savings and investment rate with the Roth and tax advantage. But then you get to step seven, you start thinking about how you're actually going to use the money. And I don't mind just giving you the answer, kind of the Cliff Notes version of this is growth assets, but not so growth that if you lose money, you're like, oh gosh, it went to zero.

• 36:28Speaker 03

  Growth not speculative.

• 36:29Brian Preston?

  Yeah, it's not speculative, is Roth. That's your tax-free account, that bucket, you really want to stick it to the government as much as you can legally by putting those growth assets. Cause man, don't we all want to be tax-free millionaires? That's always been my dream to have the Roth assets over seven figures. You want to put into the taxable account. This is stuff where not only you want access to liquidity for getting to the money quickly, but you can still put in tax favorite stuff like dividends, capital gains, things like that. Cause there's some tax benefits there as well as being easy access. And then your tax-deferred, your traditional employer match and other things, if they're not in the tax-free buckets, is this is where you go put your bonds, things that will be

• 37:12Brian Preston?

  taxed at the ordinary income tax bracket. Load up things like that, conservative type assets will go in there. And then this is the magical thing we get to do when you get more sophisticated in your investments, when they get to a size where you go, man, these guys make money sound so simple, but I'm finding as I have more and more success, it seems to get more complex. That's what we're here for is that we tell you, yeah, focus on the savings, right? Keep it simple. Don't let all this noise and how to do it right, keep you from making good decisions. That's why we do index target retirement funds in the beginning. But then yes, once you start having success, this is exactly the financial mutant type stuff that we try to maximize and help you take advantage of.

• 37:55Brian Preston?

  But it does add some complexities to your personal finances.

• 37:58Speaker 03

  Love it.

• 38:00Speaker 00

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• 39:00Speaker 05

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• 39:29Speaker 03

  Can I just throw one other thing? Also, do not, word of caution, do not sacrifice allocation for location. Meaning, I see this all the time. Someone will have, oh man, I don't really have a whole lot of qualified assets. I don't have a lot of tax deferred assets. And I got my Roth, so I have my, you know, aggressive growth assets. So all I have is this after tax account. But man, I know that it's really inefficient to hold bonds and fixed income in an after tax account. So I'm just not going to hold any of those things. Don't do that. Remember, you always have to define your allocation first. Should I be a 80/20, a 20/80, or somewhere between? You define that first. And then, once you have the appropriate allocation that matches your unique risk tolerance and your unique risk capacity,

• 40:13Speaker 03

  then you figure out, based on your account structure, how can I locate the most efficient way possible? And sometimes, this is crazy, but we have clients, based on strategies we've implemented, where they might have to hold bonds inside of a Roth IRA. I know that sounds insane. I know that sounds crazy. But if we've done a really

• 40:29Brian Preston?

  Just got acid reflux.

• 40:30Speaker 03

  If we've done a really, really good job of doing like Roth conversion strategies, that we've now converted all the qualified assets into Roth assets and the Roths are in those big, like high seven-figure numbers. Yeah, you gotta make sure that you keep the allocation intact. Location is great, but it's like, it's a cherry on top. It's not a main course.

• 40:51Brian Preston?

  I don't know if I'd have given that example, but it's true. It's the exception to the rule, though.

• 40:57Speaker 04

  But you said it was true.

• 40:59Brian Preston?

  Well, I mean, we just see, you see, you see stuff like that because some people do have huge.

• 41:03Speaker 03

  Three, four million bucks in Roth assets.

• 41:05Brian Preston?

  I mean, we, we have some clients that have seven-figure Roth accounts. It's glorious when you see it.

• 41:09Speaker 04

  Pretty cool stuff.

• 41:10Brian Preston?

  Well done, well played. You know, you know, we, one, I don't mind sharing because it's public. You know, when Delta went through that whole restructuring, they offered their pilots, when they gave up some of those pension rights, they offered to convert some of that money into Roth assets. If you're a Delta pilot and you did that and went into the Roth, well played.

• 41:31Speaker 03

  Because it was right around like great recession-ish time.

• 41:34Brian Preston?

  Because the market was getting its teeth kicked in. So everything that you put into those Roth buckets got completely amplified up.

• 41:41Brian Preston?

  That's why it's fun what we do for a living because we get front row seats to see unique things in history.

• 41:47Speaker 04

  Some pretty cool stuff like that, yeah.

• 41:47Brian Preston?

  And then you get to, you're like, oh, there's an example that I can share. Like I was on a, on a state call yesterday with a client and they were asking me, we were talking about irrevocable trust, we were talking about revocable trusts and living wills and all these terms. And they were asking me how this worked and I said, well, let me tell you a story. And I was telling them like, one example was a client that didn't need the complexity.

• 42:10Speaker 03

  Oh, yeah.

• 42:11Brian Preston?

  But he had gone to a seminar attorney who had them setting up LLCs for like four-wheelers and, you know, and all these weird, strange things. And then, you know, another one's setting up irrevocable, trying to set up irrevocable for somebody who just didn't have a net worth that, that required that. So I loved having examples to share. And then I had another example where I was like, I had a super successful client, mega success where multiple, deca millionaire type success, but had a physician father who set up all these irrevocable trusts. And then now the legacy that this father left for his super successful family is that they have for the next 15 years trying to unwind the complexity of this crazy estate plan. So.

• 42:55Brian Preston?

  Just be careful. I mean, that's what I love. But I mean, getting back to the point of, I just love that we see these things. So then we get to share it with you. So you guys don't have to fall into those traps. And you go into this whole experience with no matter if you're at the beginning of your journey, where you just need to focus on the basics and keep it simple, but keep it functioning and moving forward. Or if you're at the point where you're at the level of complexity that you just don't know what to believe, we got you covered.

• 43:21Speaker 04

  Hello, good friend. If you would like a Money Guy Tumblr, just email [email protected]. We had a poll running. You may not have realized, but the results are in. And I literally just clicked away from it. That's my bad.

• 43:37Speaker 03

  Oh, wow.

• 43:39Speaker 04

  Would you, Justin Bieber, Chase, Brian down the street? Disclaimer, not a recommended strategy. Fifty-five percent said, yes, they indeed would. Brian is a big enough deal to them.

• 43:50Brian Preston?

  Because the financial mutants are trying to put a little dab of a dollop of humor in there, because nobody is chasing us down the street.

• 43:58Speaker 03

  See videos like cellphone footage of people chasing Brian through Disney, just like chasing him down.

• 44:05Brian Preston?

  You know, that's where I was in the last few, few months. I've been to Vegas with some friends. And then I was in, in Disney and they're like, I thought you'd be recognized more. And I was like, look, we're in two places that I don't think there's as many financial mutants running around, because this is not good decision making going on in a lot of these places. It's just like, we go to Steve-O, got you rolling. Probably not a lot of financial mutants, you know, hanging out in the lobby of wherever his dealership is. Yeah.

• 44:31Speaker 04

  Steve-O.

• 44:32Speaker 03

  Reba, I had a question for you. Are you, do you and John do your net worth statement, December 31?

• 44:37Brian Preston?

  Dude, are you putting her on the spot like that right there?

• 44:40Speaker 04

  I'll be transparent. I never get to it on December 31, like you guys do.

• 44:45Speaker 03

  And then my other question was like, do y'all do it together? Or does one of you take charge of doing it?

• 44:49Speaker 04

  I usually take charge of doing it.

• 44:50Speaker 03

  You take charge of doing it and then y'all sit down and do the thing?

• 44:53Speaker 04

  I come around to you guys all the time.

• 44:54Speaker 03

  I love it. I'm just curious.

• 44:55Brian Preston?

  We're a good influence.

• 44:56Speaker 04

  You are a good influence.

• 44:57Speaker 03

  I'm curious how other people, how other people handle it. You know what I mean?

• 45:00Brian Preston?

  How about when we hired new content people? Like, hey, are you doing a net worth statement? We immediately, like, the peer pressure is just strong. There is like peer pressure in here.

• 45:08Speaker 04

  They just showed up and they're like, sure, yep.

• 45:10Speaker 03

  Because it's still good.

• 45:13Speaker 04

  I am now.

• 45:14Speaker 03

  Cause you know, it's funny. You mentioned earlier, you mentioned the, um, the date that, uh, my wife and I do. And what we do is we plan our, all of our, uh, all of our travel for the whole year. We'll get together in January, book everything. She's already starting to like plant seeds in preparation. Like, hey, I'm thinking about, let's, let's do this for the, let's go here with the kids this year. And hey, I was thinking about with this couple, let's go. Like she's already got her, and it's awesome because now we get to like talk about it and enjoy getting to look forward to that. And the net worth statement is just kind of one part of that day date.

• 45:42Speaker 04

  I usually do it early to mid-January just because that's when I get to it.

• 45:45Speaker 03

  Yeah.

• 45:45Speaker 04

  And then you have all the numbers from the.

• 45:47Speaker 03

  And then you have all the 12. I love it.

• 45:49Speaker 04

  Since you asked.

• 45:51Speaker 03

  My problem.

• 45:51Speaker 04

  And remember that is currently on sale with code BLACKFRIDAY2025. If you want to do your net worth statement as well, go to learn.moneyguy.com.

• 45:59Brian Preston?

  If I was being completely honest and transparent, the things that typically are not the most accurate on my net worth is sometimes I forget to update my footnotes. And then I forget to, the cars and the house don't always, you know, get updated as much as they should for any improvements or things like that. Or just the value of the cars. And my household, I think I've been saying for years that my household assets, meaning furniture is like $25,000 or $40,000.

• 46:28Speaker 03

  I think I did the same thing.

• 46:29Brian Preston?

  It hadn't changed, you know, since I started doing this in 2006. And believe me, the furniture is worth a lot more now than it used to be.

• 46:35Speaker 04

  I feel weird putting things like that on my net worth statement. Like we have gear or like things that probably are worth, oh, I know they're worth a lot of money. But I'm like, we're not going to sell this. I don't know.

• 46:46Brian Preston?

  One of the things that I've learned. We're too good. Our net worth tool has sometimes been too good for the, it completely confuses bankers. Cause I've put, I put deferred taxes.

• 46:57Speaker 03

  Yeah, yep.

• 46:58Brian Preston?

  And I've, I've learned anytime I talk to a banker or anybody, I have to remove all the deferred taxes because they, they just get confused. But why would you show deferred taxes? I'm like, well, because I'm trying to minimize, I want to know how much this money really is mine, not how much the government would have a hold on. Just because I have a large 401ks and.

• 47:17Speaker 03

  We were doing a.

• 47:18Brian Preston?

  And businesses.

• 47:18Speaker 03

  We were doing a thing one time and, and we submitted stuff to the banker and both of our network had deferred taxes on it. And he said, hey, um, what are these back taxes for? And what's the payment schedule? And we were like, no, no, no, no back taxes, no back taxes.

• 47:31Brian Preston?

  It's assets. You can count it.

• 47:34Speaker 03

  Funny. They got real nerdy, real fast.

• 47:36Speaker 04

  It really did. I was like, I'm glad that you all understand that. That sounds great.

• 47:42Speaker 04

  All right. Brandon 161 has a question for you. It says, hi, Money Guy Show. Do you have any tips on how not to be a financial miser?

• 47:52Brian Preston?

  Oh, yeah.

• 47:53Speaker 04

  I recently doubled my income, which is amazing, but I find myself penny pinching and I feel it is affecting my social and personal life. So this is a good question because I do feel like one of the first things you guys talk about is, is it affecting your relationships? Right? So do you want to expound on that?

• 48:10Speaker 03

  Well, Brandon, if you were, if you were a guest on Making a Millionaire, it's a show that we release every other Monday. If you want to be a guest on there, you can go to moneyguy.com slash apply and you can apply to be a guest on Making a Millionaire. If you were on there, one of the questions that we would ask when we sit down with you is, okay, why? Why are you penny pinching? Like, what's the, what's the purpose? Cause what we really want to get to the, to the base of is what's the thing that's causing you anxiety in your life? That even with this increase where you've doubled your income, why is it that you feel the necessity to penny pinch? Is it because of some, you know, baggage from childhood or some experience you've gone through? Is it because maybe you were not as disciplined as a saver early on as you should have been?

• 48:53Speaker 03

  Or is it because you have an unrealistic view of what your current financial circumstance is? And a lot of times that's what it is. Brian, we've had clients as well as friends where we've talked to them and be like, hey, you're doing this and this does not make sense. You're, you're tracking your expenses right now and you're squabbling over this eating out meal when it cannot change your financial situation. You have to really dive in to the behavioral aspect of why that mindset still exists.

• 49:22Brian Preston?

  It's funny. I, I think we're a good balance because look, the majority of Americans are not going to be wealthy. And the biggest problem they have is they don't have discipline. You know, that first ingredient of the wealth creation formula. But then there's the sad part for me, and we can see it by, by doing our annual surveys, not only on our financial mutants, but also our clients, is most of the people who are consuming our content, you're just not going to die broke. Because you have the opposite problem that the typical American has is you have discipline for days. And I just know in my own journey, and what's funny is I was listening to a podcast this morning. And then we even just pressed publish. Did I say that right?

• 50:03Speaker 05

  You did.

• 50:03Brian Preston?

  And the gentleman who, because I'm doing great at describing, but I never can remember his name. I described everybody when he gave the keynote is he basically said, I got to the top of the mountain. And then I quickly realized it was not what I thought it was going to be. So I was running back down the mountain telling everybody quit. It's not what I thought it was going to be. What's that guy's name?

• 50:22Speaker 03

  Casey Neistat.

• 50:24Brian Preston?

  How can you guys remember this stuff so easily? But anyway, so I kind of have the same experience is that if you're a financial mutant and you think that when you get to $3 million, $5 million, whatever the XXX is and you're formulating your brain, that once you have this, it's going to solve all your problems. I think you're going to find it's much more empty than you realize. So that's why I'm always very deliberate with telling you, don't ruin your relationship since you have this key muscle of discipline. Make sure that when you get to be my age in your 50s, that you look back at your 20s, you look back at your 30s, you look back at your 40s in these very distinct phases of life and that you don't have regrets.

• 51:07Brian Preston?

  Because it breaks my heart when I find out, like I had a very dear friend that his marriage almost ended because he was still making his wife keep receipts to give to him every time she used a credit card. And they didn't need to be doing that anymore. That might've been very valuable at the beginning of the marriage in your 20s, when you're doing budgeting and other things, but when you go to a more cash management plan and you know, you're more making your money go to the pots and you don't have to track every little thing. That's going to be healthier for somebody than to look like you're hyper, you know, managing, micromanaging everything that your spouse is doing. And it's the same way when your kids don't want to go on vacation with you

• 51:47Brian Preston?

  because you still got them sleeping in the closet in a sleeping bag and a blow up mattress because that's cheaper than actually getting the adjoining rooms. You might be losing the plot a little bit on what money as a tool can, can and cannot do for you. Now, don't mishear me. This is not Die with Zero where I'm assuming that you're going to be an investment banker who can make multiple. Hundreds of thousands of dollars a year. So you should go live a hog wild life in your twenties. I'm trying to give you the balance that there's a definitely a dance here is I want you to be disciplined, but I want you to not have regrets when you get older.

• 52:22Speaker 03

  It's one of the reasons why we say we want you to save 25% of your gross income. So that it can be an unlock for spending. It's not so that can be restrictive like, oh, I gotta save, save, save. It really is more for financial mutants to say that, okay, if I do this, I can check the box. You guys can't see this, but I made this little like sticky note flow chart. And this is what I basically said, I want you to ask yourself these questions, Brad. Hey, am I, am I under 35 years of age? If the answer is no, I'm older than 35. Okay. Have you done the know your number course? Do you know what your number is? Have you assessed where the finish line is? Do you know where you are today and are the steps you're taking on track to get you from where you are today to where you want to be?

• 53:02Speaker 03

  Right? That's if you're over 35. If you're under 35, ask the question, okay, am I going to be part of the fine movement? If the answer is yes, same thing. Have I done the know your number course? Do I know where I am? Do I know where I need to be? Am I on the right trajectory? Do I need to make adjustments? If you're under 35 and you're not trying to do fine and you're saving 25% of your gross income, then you can stop there and you can just free yourself to say, man, I'm doing what I need to be doing. I'm paying myself first. I'm checking that box. I don't have to pinch pennies once I've done that. Whether I spend a gazillion dollars on whatever this thing is, so long as I've paid myself first, I'm okay and I can do it freely without any guilt.

• 53:46Brian Preston?

  I feel like we just in real time, watch Bo create a decision matrix that will show up potentially on the resource page. No, because this is a great point because a 28 year old comes to us, it's completely different than if somebody comes to me who's 42. Because if you're at the beginning of your journey, I, I, I, I want to acknowledge and celebrate with you that you're a hyper accumulator. When you're at the beginning, because that is going to add flexibility. But when I find out that you're doing this stuff, because it's back to the make wealth, the maintain wealth, and then the multiply wealth, where are you at in the journey? And, and that's why the 40 something year old who is at already at the main, now at the maintain wealth,

• 54:27Brian Preston?

  but still living like they're, you know, broke as a joke, you might've lost the plot. I think that's a great, I like, I see where your brain, we share a brain, so I see what you just did there with that decision. I'm like, we should create something like that.

• 54:42Speaker 03

  God, this is, you need me to hold on this sticky note so y'all can, okay, we'll archive this one away.

• 54:48Speaker 04

  That's the archive right there.

• 54:50Brian Preston?

  No, but that could be, because then you could put little bubbles with the products that kind of help with, you know, the things, because that's what people say, are you just trying to sell stuff? No, I recognize that there's going to be things you need on this journey before you actually need a wealth manager. And that's what we tried to design, that's what the know your number, that's why the net worth tracker, we're trying to give you the resources so that you can kind of go grab those tools when you're in need before you need to hire a wealth manager.

• 55:19Speaker 03

  Love that.

• 55:19Speaker 04

  Great. Well, Brandon 161, if you would like a Money Guy Tumblr, just email [email protected].

• 55:27Speaker 04

  Let's go on to Money Marathons question. It's about the net worth statement. It says, are kids 529 on the balance sheet? I ask as the balance can potentially be converted to an IRA for unused funds. We never have a crystal ball if they don't, if they don't attend college or have over saved. Basically saying, you know, you don't know what they're going to use the money for in the future, whether or not they're going to do college. So do you count this on your balance sheet, on your net worth statement?

• 55:59Brian Preston?

  This, this falls under the category of, you just heard, I made a confession earlier in today's show that I don't update the footnotes like I should sometimes, because I'm so excited to update account balances. I will tell you, I consider 529s to be footnote items. They're not to be listed under your assets. They serve a very valuable purpose, but they're not for you. They're for your children and their education goals. The same thing with pensions. I think pensions are more of a disclosure that you put on the footnotes than your ability to put them on the net worth statement. Unless there's a You know, convert it to an IRA.

• 56:40Brian Preston?

  Cause a lot of them now, if that's the case, you, you know, it's, it's a gray zone and we could talk about that. But for people who are strict, like government employees, those promises are more footnotes to, to offset. And it's the same thing with 529s. It's not your money.

• 56:54Speaker 03

  Yeah. The other thing I would say is you said, oh, well, one day they can be converted to IRA balances. They can be converted to IRA balances for the beneficiary. That's often going to be your kids and your kids assets wouldn't be listed on your net worth statement anyways. 529s in our mind are a prepaid future expense. So we're okay getting that off of the balance sheet. Now let's say something happens and your kid doesn't go to college and decide that you're going to recoup those funds and you're going to distribute them all. You're going to pay the tax on the earnings. You're going to pay the penalty on the earnings and cash it back out. Once you've done that, it will come back into your net worth statement. But right now, while it is still a prepaid future expense, I think it stays a footnote item. No different than home equity is not going to be a balance sheet net worth statement item unless you sell your house.

• 57:38Speaker 03

  And then it becomes part of your net worth. But while it's not actually there in existence, we do not include it because we want that to stay concerned. We want your net worth to really point towards what is building towards your financial independence, your great big beautiful tomorrow. Trying to think through other things that don't show up on, you know, some of the stuff that are our footnotes. And, and for us, if you, again, if you use our tool, it's like accounts for kids, 529s, up and accounts, that sort of thing. It's insurance. Okay. I have this term insurance. Here's a policy number. Here's how much, here's who, you know, here's who the owner is, who the beneficiary is. Disability insurance. Uh, one of the things I think that's very, very helpful to list in your footnotes is who are the people in the estate documents that matter?

• 58:23Speaker 03

  Uh, who's the executor and who are the trustees and who are the guardians? If you can have that all in one place and something were to happen to you or something were to happen to you and your spouse, it just makes it very easy for whoever that executor is to step in and say, okay, here it is. I have the playbook of everything I need to know to be able to pick up these pieces. And so if you can keep that information there and updated, it really, really helps everyone be on the same page, especially if you have a. A less involved spouse. Okay. And, and here's another thing it does, because we just did this. Uh, this year, we updated the guardianship provision in our estate documents for our kids. Because one of the things I was doing, when I updated our footnotes, is like, man, okay. The people that were gonna be guardians, we still love them, they're still amazing. They live in a different state and our kids are the age now, if something happened to us,

• 59:07Speaker 03

  we don't want our kids to have to move into a different state. So we changed who the guardians are in our estate documents. It was updating the footnotes on the net worth statement that illuminated the need to do that. So if you're doing this consistently, it will bring to light the things that need to be updated and adjusted.

• 59:22Brian Preston?

  Well, yeah, it's a great communication tool. That's why we, we, we try to share that, insurance agents, CPAs. And then I, I, another thing that I think is very valuable is I like that this is essentially the decoder ring for if you share like a password manager with your spouse and y'all have a shared password manager, the, the, the net worth statement's going to be the decoder ring to know where all the institutions that you have accounts. Um, so they can, if something happens to you and they're the non-financial spouse, they can go recreate or know where everything is.

• 59:59Speaker 04

  That's great. Um, very good thorough answer there for money and marathons. Thank you for your question.

• 1:00:06Brian Preston?

  I don't know how we went from 529s to password managers to pensions. I mean, we tried to, we just tried to give all the facets to it.

• 1:00:14Speaker 03

  You're right. Us, us starting in one place, wandering in the woods for a while and ending up in a wild location seems very uncharacteristic.

• 1:00:23Brian Preston?

  I, I don't know why I didn't make two cups of coffee. I keep looking at this thing and why did it not, why is there only, or did I not put enough volume? You know, on the coffee maker, you can add more, because it's this, whatever. I know, what y'all don't know, behind the scenes.

• 1:00:37Speaker 03

  We're not sponsored yet.

• 1:00:38Brian Preston?

  I know, I'm not gonna say anything. I'm not saying any brands. Rebi for the last three months has been changing out the beans in the espresso machine. And I've been like, no, yuck, no.

• 1:00:50Speaker 04

  Well, one of them didn't work.

• 1:00:50Brian Preston?

  And I don't even like to think that I'm at that high maintenance, but this one, this one was pretty good.

• 1:00:55Speaker 04

  And Josh recalibrated the machine a little bit.

• 1:00:59Speaker 03

  He just grind setting and all the stuff.

• 1:01:01Speaker 04

  So I think there were a couple of issues going on.

• 1:01:03Speaker 03

  Chef's kiss.

• 1:01:04Speaker 04

  Your coffee machine's a little too fancy in a way.

• 1:01:08Speaker 03

  I refuse to agree with that premise.

• 1:01:11Speaker 04

  Well, this one was good.

• 1:01:13Brian Preston?

  And by the way, it might also be, because I just came from Thanksgiving holiday. I've been loading it up with peppermint mokas, but cookie butter.

• 1:01:23Speaker 03

  Hold on, in your machine?

• 1:01:24Brian Preston?

  No, all these flavored, you go to the grocery store and it's like,

• 1:01:27Speaker 04

  creamers.

• 1:01:28Brian Preston?

  You know, some people get excited about going to liquor stores. I get excited about going and looking at the creamer aisle in the grocery store, because that's where my indulgence is these days. It's not the liquor store anymore.

• 1:01:39Speaker 03

  That's the most Mr. Rogers thing that you have.

• 1:01:41Brian Preston?

  No, but it's true. I go in and I'm like, oh my God, cookie butter. What is that? And then I'm like, oh, wow, coffee cake. Yeah, I must try that. So it's, um, so that's, that's my fun. So drinking coffee as coffee this morning, because I didn't put, you know, anything but a splash, just a little splash of half and half. It's like, no, I still like coffee. It doesn't have to have all the gimmicks that I put into everything.

• 1:02:04Speaker 03

  Love it.

• 1:02:05Speaker 04

  But I did, I saw him several times, just looked kind of sadly.

• 1:02:09Brian Preston?

  It was a good cup of coffee. Now, we are past, oh, yeah, glad, thank goodness, it's past, it's almost 11 o'clock. I don't need to have any more caffeine.

• 1:02:17Speaker 03

  That's another one of our money guy rules is Brian does not take any caffeine after 11 a.m.

• 1:02:22Speaker 04

  He's too powerful if he does that.

• 1:02:24Brian Preston?

  No, I just don't sleep.

• 1:02:27Speaker 04

  Well, this has been amazing. Thank you for all of your financial questions. We will be back here Tuesday at 10 a.m. Central, answering even more of your questions. And remember to head to moneyguy.com. We have the Black Friday sale happening right now. Only one more day of that, so be sure to take advantage if you were interested in the net worth tool or any of our courses. Go to learn.moneyguy.com and use code BLACKFRIDAY2025 to take advantage of that 20% off, because then it will go away and it will be back to normal price. So we know you would love a deal like we would, so please take advantage.

• 1:03:00Brian Preston?

  I know I said it last week, but still I'll, I'll give a belated, thank you, thank you, thank you. Thanksgiving was just last week and we couldn't do half the things. When we do studio tours, people say, did you know it was going to be like this? No. And we're still like, we're, we're an overnight sensation that's been doing this for 20 years. At this point, but it's it's still, I don't take for granted anytime we get to meet you guys in public or you come do studio tours or just even you show up in a live stream means the absolute world to us because we we are having a blast. I mean, this is, I couldn't think of a better thing to do for a living and and the changes we're making in people's lives and you make all that possible. So I just want to make sure I said thank you. I'm your host, Brian, joined by Bo Rebe and the rest of the content team, Money Guy team, out.

• 1:03:45Speaker 03

  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 of 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.