When Is It Finally Okay To Enjoy Your Money?

Jacob and Elyssa have a $523,000 net worth, nearly $300,000 in retirement savings, and a household income of roughly $117,000—but everyday spending still feels tight. After leaving accounting to become an electrician, Jacob is rebuilding his career while they raise two young children. On this episode of Making a Millionaire, Brian and Bo examine their budget, mortgage payoff plans, and hopes for a bigger home and future business. Can they pause retirement contributions without losing sight of financial independence? Discover why their plan starts with more breathing room—and permission to enjoy the life they’re working so hard to build. ⁠⁠⁠⁠Jump start your journey with our FREE financial resources⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Reach your goals faster with our products⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Take the relationship to the next level: become a client⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Subscribe on YouTube for early access and go beyond the podcast⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠Connect with us on social media for more content⁠⁠⁠⁠⁠⁠⁠ Bring confidence to your wealth building with simplified strategies from The Money Guy. Learn how to apply financial tactics that go beyond common sense and help you reach your money goals faster. Make your assets do the heavy lifting so you can quit worrying and start living a more fulfilled life. Learn more about your ad choices. Visit megaphone.fm/adchoices

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

• 0:00Speaker 00

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• 0:31Speaker 01

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• 0:59Speaker 02

  So Alyssa sends me out, please go buy some stuff for a Christmas dinner. Let's have something nice. I get to the grocery store, pull out the budget, I see a goose egg. So I turn back around, walk home and say, Alyssa, we are not doing a Christmas dinner this year.

• 1:11Speaker 03

  If money were not an object, what are the things that you guys would be doing that you're not doing?

• 1:15Speaker 04

  I think we would have more fun money. Clothes, phone, got a Kindle Unlimited subscription.

• 1:19Speaker 02

  We would get a place that had more bedrooms.

• 1:21Speaker 03

  She said Kindle subscription and clothes.

• 1:25Speaker 04

  I'm just saying like that's.

• 1:26Speaker 03

  And you said another house. So, okay, we're not, let's pause there for a moment.

• 1:37Speaker 03

  Where are y'all from? Where's home?

• 1:38Speaker 02

  We live in Denver.

• 1:39Speaker 03

  Denver, oh, Denver's so wonderful, isn't it?

• 1:41Speaker 04

  It's great.

• 1:41Speaker 03

  Are y'all from Denver originally?

• 1:43Speaker 02

  No, sir.

• 1:43Speaker 04

  No.

• 1:44Speaker 03

  Where are you from originally?

• 1:44Speaker 04

  We went to middle school and high school together in Ohio. So.

• 1:47Speaker 03

  Wow. Ohio.

• 1:49Speaker 04

  Yeah, in Cincinnati.

• 1:50Brian Preston?

  Y'all date since middle school or did y'all like come back together later?

• 1:53Speaker 04

  We were studying abroad the same semester in college and we were at different colleges and met up and connected.

• 1:59Speaker 03

  Abroad met up? What, where was this, where was this at?

• 2:03Speaker 04

  So I was in Barcelona and he was a little north of Rome and we'd gotten a Christmas card from his family.

• 2:08Speaker 03

  Geography's not my strong suit, but those aren't close to each other.

• 2:12Brian Preston?

  Spain and Italy.

• 2:14Speaker 04

  You know, some people on their Christmas cards do a whole page.

• 2:17Brian Preston?

  Right.

• 2:17Speaker 04

  His mom does a whole page on Christmas cards. And it said Jacob's gonna be in Rome. And I was like, well, I'm gonna be in Rome for spring break, so I should message him. So.

• 2:25Speaker 03

  Hold on, so y'all were, so y'all were close enough friends growing up that y'all were like on each other's Christmas card list?

• 2:30Speaker 04

  Yeah, we went to the same church together, so like.

• 2:32Speaker 03

  Okay, so.

• 2:33Brian Preston?

  But wait a minute, you're making, did you kind of think he was cute?

• 2:37Speaker 04

  Not, I mean, we went to.

• 2:38Speaker 03

  Wait, wait.

• 2:38Brian Preston?

  I thought he was.

• 2:39Speaker 04

  We went to home church the sophomore year, but we didn't ever like date, like we were family friends.

• 2:44Speaker 03

  Oh, but come on.

• 2:45Brian Preston?

  Y'all were married then, so you have kids, so you can say, but one of you, if you're like, I always thought he was good looking.

• 2:50Speaker 04

  I mean, yeah, he was cute, but like, he was kind of a jerk in high school.

• 2:53Speaker 02

  Oh, a bit of a brat.

• 2:54Speaker 04

  And that's, that's what I told my mom. I was like, he's really grown up. He's not a jerk anymore.

• 2:58Speaker 03

  Wow.

• 3:00Speaker 04

  So.

• 3:01Brian Preston?

  This is, hey, but you know what? Sometimes however you have to bait the state, you know, to have it all work out, it seemed like that whatever your long-term play worked, it worked.

• 3:11Speaker 03

  All right, so y'all, so y'all knew each other in middle school, church friends, school friends, you get together or you, you re-meet abroad in Europe, start dating then?

• 3:21Speaker 04

  We kept in touch for, that was spring of junior year.

• 3:28Speaker 02

  Yeah, six months.

• 3:28Speaker 04

  So six months or so, and then winter break of senior year, I'd been asking you out. I'd been like, hey, you should come.

• 3:36Brian Preston?

  Noticing a theme.

• 3:36Speaker 04

  Yeah, I know, I know.

• 3:38Brian Preston?

  There's nothing wrong with it.

• 3:39Speaker 03

  No, I think it's awesome.

• 3:41Speaker 04

  This is me.

• 3:41Speaker 03

  Good for you, that's awesome.

• 3:43Speaker 04

  I was like, we should go on a date. So I told him that our exams ended the same day. Mine ended a few days earlier. I was just chilling at school. And I was like, we should meet up in Nashville. That's like halfway through. You're driving to North Carolina, I'm going up to Ohio, cause his family had since moved to North Carolina. We could meet up halfway. And we did, and that's actually when we started dating.

• 4:03Speaker 03

  In Nashville?

• 4:04Speaker 04

  In Nashville.

• 4:04Speaker 03

  And here we come back together full circle.

• 4:06Speaker 04

  I know, I saw him like, this is so fun.

• 4:07Speaker 03

  Man, okay, so when, how long have y'all been married?

• 4:10Speaker 02

  2019, so seven years.

• 4:11Speaker 03

  Seven years, uh, family situation, you got kiddos?

• 4:14Speaker 04

  Yeah, we have a two-year-old and a six-month-old.

• 4:16Speaker 03

  Oh, man, y'all are in the messy middle.

• 4:19Speaker 02

  Really, we're body training my daughter and it is very messy.

• 4:22Speaker 03

  Literally.

• 4:24Speaker 04

  I mean, no, she's, she's crushing it. She's doing great, but it's.

• 4:28Speaker 02

  We say that having been here now for 24 hours.

• 4:32Speaker 04

  As we've watched her with your mom.

• 4:33Speaker 03

  I was gonna say, so they're not with you, it's just, so.

• 4:36Speaker 04

  Yeah.

• 4:36Speaker 03

  Is this the first time y'all have traveled without the kids?

• 4:38Speaker 04

  Yeah, it's so fun.

• 4:41Brian Preston?

  That's the way my wife was, the first time we traveled, it was like a little bit of hesitation of right at first, but then after the first day, it was like, okay, this is, this is good again.

• 4:50Speaker 02

  And we should throw a quick shout out, thank you, mom. We really appreciate you.

• 4:53Speaker 03

  Yeah, right, mom, thank you, you are the real MVP.

• 4:55Brian Preston?

  Well, y'all, y'all both, cause I'm just reading the, the notes and bringing everybody up to speed, were y'all both accounting majors?

• 5:00Speaker 04

  Yes.

• 5:00Brian Preston?

  Okay.

• 5:01Speaker 04

  Yeah, well, no, I was an accounting major, accounting operations, so I knew I wanted to do my CPA and then.

• 5:07Speaker 02

  I was just a bozo in college. I hadn't figured out that you gotta like work hard to get a good job.

• 5:10Speaker 03

  Bozo in college, jerk, you said, what was it? What'd you say she was a jerk? What'd you, what'd you say it was?

• 5:14Speaker 02

  Bit of a brat.

• 5:15Speaker 03

  A bit of a brat. He was a brat growing up and then a bozo in college.

• 5:19Brian Preston?

  Man, we are just on the upward track here.

• 5:21Speaker 03

  All right.

• 5:22Brian Preston?

  I think you're being very self-deprecating.

• 5:24Speaker 02

  No, but like, no, I, I really did make kind of a fool of myself. So I wanted to be a dentist.

• 5:30Speaker 03

  Okay.

• 5:30Speaker 02

  Made some poor decisions, slept through an anatomy final, failed anatomy and said, you know what, maybe five more years and a quarter million dollars is not a good plan. So went and got a master's of accounting and became a CPA.

• 5:42Speaker 03

  Most people don't like default to master's of accounting, right? Like, that's pretty impressive. So you got something going on there, right?

• 5:48Speaker 04

  Yeah, there are some programs that just let you do, like a one-year program, like you were thinking either you could do a nurse in one year or become a CPA in a year. And at that point, we had been dating, so I was like, I'm a CPA.

• 5:59Speaker 03

  And you're like, I gotta help with homework.

• 6:00Speaker 04

  It's gonna be a great college, it's gonna be a great career, you can do it. So, yeah, so that's what you did. But then obviously it was not for you.

• 6:07Speaker 02

  It was not for me.

• 6:08Speaker 03

  Okay, so you graduate and you start working, taught us about the early part of your careers.

• 6:11Brian Preston?

  Did you get the CPA too?

• 6:12Speaker 02

  Yeah, so we both got CPAs.

• 6:13Brian Preston?

  High aptitude, obviously, because that's not, I mean, I chose account, well, no, but seriously, let's. I chose accounting because, not because I loved the curriculum, but because I wanted to be guaranteed a job. I mean, being honest with you, that's why I chose, I was originally a finance major and I was like, this is too easy. And too easy equates to everybody can do it, we gotta thin the herd. So accounting, everybody graduated from Georgia with an accounting degree had a job. So I knew I wasn't moving back in with the parents if I did this. Now, once I got into the profession, I actually loved it, I thought it was cool, but it sounds like your experience was the opposite.

• 6:49Speaker 02

  It's definitely a good job, but I, since high school, probably realized I wanted to do something more manual, more hands-on and real. Like, I remember staring at these spreadsheets, having to motivate myself, like, this doesn't matter, this is never gonna go anywhere, all this is ever is gonna be is a spreadsheet.

• 7:01Brian Preston?

  Have you always been handy? Like, you, you're a person that always is taking things apart, putting it together?

• 7:05Speaker 02

  I like to think so, I hope so. And so I, I thought about doing some other things. So we were in Seattle, we went to London for a couple of years because she was a good accountant and they accepted me with her. I switched over to being a FPNA analyst.

• 7:21Speaker 04

  Full work in London, yeah.

• 7:22Speaker 02

  Cooler, didn't love it, and was thinking through other career options when we came back. Cause I figured when we come back to the States, this is gonna be our chance to make some career changes.

• 7:29Speaker 03

  How long you were in London for?

• 7:30Speaker 04

  Two years.

• 7:31Speaker 03

  Wow, okay.

• 7:32Speaker 04

  Yeah, so we had a couple of years in Seattle and then two years in London. Then we, I was pregnant when we moved back to Denver.

• 7:38Speaker 02

  And so I think the math was kind of, if we don't do this change now, we're gonna get used to the money, we're gonna be locked into something that will not allow that opportunity. So we both then kind of stepped back and said, you know, what do we want out of life? And we decided that we wanted to take a step back in our career for both of us. I wanted to try something new and Alyssa's really been the one that's made this all work. So Alyssa's been a super trooper, been super great, supported me through like, like, quite like some folly really. But I love doing it. I'm really, really excited about the future of being an electrician and I really enjoy doing it every day. So I'm really thankful to Alyssa for that.

• 8:10Speaker 03

  And how, how old are you guys right now?

• 8:12Speaker 04

  30 and 31.

• 8:13Speaker 03

  30 and 31. Well, y'all must have done something right while you were earning that kind of income, cause you're kind of to share your net worth status with us. And we look at this.

• 8:20Brian Preston?

  It's pretty good.

• 8:20Speaker 03

  At 30 and 31 years old, here you are with a total net worth of $523,000. You guys have done well, almost $300,000, that's liquid between Roth IRAs, Roth 401Ks, traditional IRAs. You've got a really decent chunk of cash on hand at $60,000 and you've got a home with a mortgage that's 5.875%. I don't know if you know this mortgage, it's like seven and a half, so that's like not crazy right now. And a ton of equity in this house. So you guys are sitting in a pretty solid financial spot. Do you feel that way?

• 8:52Speaker 04

  Yeah, I think we both feel really good about our net worth, where we go, thank goodness for our careers early on, that, when we saved so much money, cause that's really what set us up is early savings.

• 9:04Brian Preston?

  And y'all had very aggressive savings rates back then, right?

• 9:07Speaker 04

  Yeah, I was like probably close to 50% when we.

• 9:10Speaker 02

  Not quite.

• 9:10Speaker 04

  No, 40?

• 9:11Speaker 02

  It was in the twenties to thirties, like if you go net versus gross, it can get higher, but.

• 9:15Speaker 04

  Okay.

• 9:15Speaker 02

  Very aggressive.

• 9:16Speaker 04

  It felt like a lot, but I mean, what else is there to do?

• 9:19Speaker 02

  This is probably a good point to talk about, like how we think about money, because I came in very cheap, like exceedingly cheap. So to put a point on it, when we first got married, we had to stay in Seattle for Christmas so I could do inventory counts for my job. So Alyssa sends me out, please go buy some stuff for a Christmas dinner, let's have something nice. I get to the grocery store, pull out the budget, I see a goose egg. So I turn back around, walk home and say, Alyssa, we are not doing a Christmas dinner this year. And she said, not a chance. What'd you say?

• 9:47Speaker 04

  I said, no, go back out. And you did. Um, yeah, you were like.

• 9:50Speaker 03

  You thought that that was gonna work? Like she sent you for Christmas dinner and you thought, oh, budget says zero, so we're not doing it.

• 9:55Speaker 04

  That's where I have the leftovers. No, that's him.

• 9:57Speaker 02

  You're stuck with me.

• 9:57Brian Preston?

  I think I'm seeing a movie with this theme, it's Heavens Are Screwed?

• 10:03Brian Preston?

  You're gonna get ghosts to visit you at night, you're not careful.

• 10:06Speaker 04

  It's not like we had no money. If we had actually no money and you were like, no Alyssa, we really need to be on a budget, fair enough. We had money. We were just like saving it for an emergency fund.

• 10:16Brian Preston?

  Y'all had four savings that was making it where your budget was zero essentially.

• 10:20Speaker 04

  Exactly. So I think you are a lot better now of, you know, making sure that we're not crazy.

• 10:24Speaker 03

  What changed? So you went from like super tight, super frugal, no Christmas dinner, and now you said you look at money differently. What, what was the?

• 10:31Brian Preston?

  We flipped the switch.

• 10:32Speaker 03

  Cause I think a lot, a lot of financial mutants, I think are gonna resonate with that. They, or at least one of the spouses is gonna say, yeah, my spouse is that guy, right? How'd you change or what changed that allowed you to have that mindset shift?

• 10:44Speaker 02

  So I talked about switching to be at the accounting grad school. So when I went into that, I was legitimately spending outside around like $250 a month. Like it was real rice and beans, Dave Ramsey stuff. And so that's, that's what I came into our marriage with and learned about time value and money, learned about 88 times over. And I would do the math of like, oh man, this is five bucks, like that's a couple hundred dollars.

• 11:05Speaker 02

  But I think, again, to Alyssa's credit, Alyssa really is the key to a lot of this. She was much better about, like, look, you can't take it all with you. You gotta live today. We gotta make good memories. We gotta do the stuff that's worth doing. And so I think she has a really healthy view of what money's worth and what it's for.

• 11:20Speaker 03

  But it doesn't sound like you're a crazy spender. You're not like, hey, let's not save anything. Let's spend it all today.

• 11:24Speaker 04

  No, absolutely not. I also think we, you know, need to have retirement and that. But I definitely am more.

• 11:31Brian Preston?

  Are you the CFO of the house?

• 11:32Speaker 04

  I would say Jacob's actually the CFO.

• 11:34Brian Preston?

  I'm sitting here hearing that. Skill set because you're balanced. You actually want to save. Jacob's taking himself all over the place here on his personality. So I'm just wondering, who's driving this ship?

• 11:45Speaker 04

  Jacob's definitely driving the ship. He does more of the making the proposed budget when we do have like income changes or when we bought the mortgage or bought the house, right? He would take the first pass at that. But then we do the sit down and we look at it together and go, is this actually going to work? Yes or no?

• 12:05Speaker 02

  And I think to that end, we both really enjoy budgeting because it's a prioritization exercise for us. Because, you know, yeah, and it really lets us think through what is most important to us. It gets us on the same page and then we're pulling in the same direction. It's not super fun holding a budget, right? Like maintaining it, keeping your spending. But the process of determining what's really important is a lot of fun. And we do, we'll do dates, you know, little dates that we can swing. And so I do that in investing and Alyssa does a lot of the day to day management, our CAO, really.

• 12:34Speaker 03

  When you, so you said, when you guys were both in the accounting field, higher income, what was household income at that time?

• 12:41Speaker 02

  It started at like 115 and then by the end it was in the 170 range.

• 12:46Speaker 03

  170. But now as you've made this shift to move away from accounting into the electrical field, there's been a decrease in income? So is 117 kind of household income now?

• 12:56Speaker 04

  Yeah, and mine's variable. So that's hard. I do finance and accounting consulting for small businesses now. So once we had our daughter, I stepped back from full time and so I work 10ish hours a week.

• 13:08Speaker 03

  Oh, great.

• 13:08Speaker 04

  Doing finance and accounting consulting.

• 13:10Brian Preston?

  For yourself or for a firm?

• 13:11Speaker 04

  For myself. Well, my parents, they own a small business doing finance and accounting consulting and HR consulting as well. So I work with them.

• 13:20Speaker 03

  So as you guys have adjusted the budget from $170,000 income to $117,000 income, how'd you do it? Again, because I think a lot of people are going to be curious about how were you able to successfully scale back?

• 13:32Speaker 04

  Our fun money, our discretionary spending went down.

• 13:35Speaker 03

  Not your savings?

• 13:36Speaker 04

  Savings went down too. Savings went down too. Yeah, savings went down and the fun money went down. But like what we would say is the necessities. So like groceries stayed the same. What we would have spent on housing probably stayed the same. So it's really just in the savings and fun money that we've seen quality of life decrease.

• 13:55Speaker 03

  And how long has that been?

• 13:56Speaker 02

  Two and a half years, about.

• 13:56Speaker 04

  Yeah, yeah.

• 13:58Brian Preston?

  And how are y'all doing through this? Plus, you added some kids in there too.

• 14:01Speaker 04

  We added some kids.

• 14:02Speaker 02

  If I can actually take this one, I think it's like conflicted is the good way to say it. Because we look at the top line and it seems like a good number, like 10,000 a month is not a joke. We look at the balance sheet and it's like really encouraging. We feel very confident about the future. And that's why we made the switch. Like we felt like we were in a position to have that foundation. But at the same time, living in it, there's a feeling of, wow, I can't believe there's this little leftover. And maybe an important part of that is it's really important to us to tithe. So we tithe 10% of gross. We have pretty decent tax load because Alyssa's self-employed.

• 14:33Speaker 04

  Yeah.

• 14:34Speaker 02

  And I think everything else is kind of in the guardrails. No credit card debt, no card debt, under 25% for housing. So it's kind of like, how does it feel so tight? And we're always, again, I was cheap to begin with, but why are we always the cheap ones? Like all the time?

• 14:49Speaker 03

  Like amongst your friends and stuff?

• 14:50Speaker 04

  Yeah, yeah.

• 14:52Brian Preston?

  Can I just give you all a little perspective? This is a moment in time.

• 14:56Speaker 02

  Sure.

• 14:56Brian Preston?

  I mean, because you are in this apprenticeship phase right now. So you know you haven't reached your potential yet.

• 15:04Speaker 02

  Certainly.

• 15:04Brian Preston?

  So that's, and you're also, because you're in the messy middle, you also have a governor on you as well. So I mean, I think take a moment to celebrate that even with you in a recast of your career and you being dead in the middle of the messy middle with littles.

• 15:20Speaker 04

  Yeah.

• 15:21Brian Preston?

  This is pretty good. I mean, so I mean, if you can survive in this period, and that's what the only thing I worry. Look, deferred gratification is like the first component that I always teach high school kids about. You have to give a little bit of today to get that awesome thing in the future. And y'all have done that. And you're also in the middle of it right now. But don't be too hard on yourself. I would just keep a carrot towards, this is a moment in time. It doesn't, it's not permanent because that would be a different feeling if this is all you could do forever on the memory making, the travel, the fun, the savings. So how, what's the next chapter that y'all are envisioning? And give us the path. I would like to know what your career looks like in the next three years.

• 16:04Speaker 02

  So I have two, three years left, second, three years left in my apprenticeship.

• 16:10Brian Preston?

  Is this like a residency for like a doctor though, where you get no pay? You're just kind of like broke, broke, broke lots of money? Or is it, how does it work for an electrician?

• 16:17Speaker 02

  So I'm in my second year, just starting. So that one, that one's tight. Third year will be still pretty tight. And fourth year it'll start feeling good. And then when I turn out, it'll be.

• 16:26Speaker 04

  But it's based on like you are getting paid as a percentage of the journeyman wage. So every year that wage goes up and then in Monday and Wednesday, you're in your school.

• 16:36Speaker 02

  Yeah, so I grew up like really anti-union. So it was like quite a strange transition for me. But it's been a great experience and having that certainty around pay and benefits is great.

• 16:46Speaker 04

  And the pension, you would eventually get a pension. Right now it's not worth very much, but.

• 16:50Speaker 03

  From a family situation, two kids, are y'all more kids? We're stopping at two? What's the plan there?

• 16:55Speaker 04

  Like another, our younger son has some health issues and so that just leaves us with uncertainty before. Oh, and timing on the third, before we're like, yeah, let's.

• 17:05Speaker 03

  Rock and roll.

• 17:05Speaker 04

  Yeah, but now, now it feels a little hard to do that immediately, but definitely want a third.

• 17:11Speaker 03

  Okay, so plan is for a third. And then when the third, will you, is your workload manageable? Like can you continue doing 10 hours a week even while having kids in the house and that sort of thing?

• 17:22Speaker 04

  Yeah, yes, I can. I started childcare. So I've got childcare for like 12 hours a week.

• 17:28Speaker 03

  The mathematics substantiates it. Like you make more than childcare costs. That's the thing that y'all have worked out?

• 17:33Speaker 04

  Yes, I will make more every month than childcare costs, so.

• 17:38Speaker 02

  By a significant margin. Like legitimately, if it weren't for her, this would all be.

• 17:43Speaker 03

  So, okay, so Brian's already laid out, this is a temporary moment in time while you're working through this apprenticeship. But he said, man, I just feel like we're so tired of being the cheap ones. We're so tired. If money were not an object, what are the things that you guys would be doing that you're not doing? What are the things you would spend money on that you don't feel like you're able to spend money on now?

• 18:01Speaker 04

  I think we would have more fun money. Right now it's.

• 18:04Speaker 03

  What do you do with fun money?

• 18:06Speaker 04

  Fun money, clothes, phone, got a Kindle Unlimited subscription, right? All those small things that would be just for like one of our two. And then we have a little bit of money that we spend together. So dates, eating out, that's maybe 100 bucks a month. That would be nice. And then more gifts.

• 18:22Speaker 02

  So we were talking about this last night and the first one is we would get a place that had more bedrooms. We're in a two-bedroom place and we're comfortable with that.

• 18:29Speaker 03

  Okay, so we just, we went, she said, she said Kindle subscription and clothes. And you said another house. So, okay, we're not, let's pause there for a moment.

• 18:41Speaker 04

  But when we're talking about, if we want to be more generous and have that, those would be the things where we would want to expand.

• 18:49Speaker 02

  If we step back and look at the macro level, because we talked about this a little bit. We at some point would like to get a bigger house, like five people in a two-bedroom. That's going to be really tight. We would like to be able to have hobbies again. Like we have really effectively no hobbies. We live in Denver. We'd like to be able to ski, teach our kids to ski. We'd like to have a little bit more flexibility for ourselves, like she said. And then we'd like to be able to be more generous again. Because it feels really tight. It doesn't feel like there's a lot of flexibility to be able to do gifts with family, bring people over for dinner, be generous with the community and neighbors and stuff. And that's something we would like to get back to being able to do. And just for me, because of my excellent personality, having that set aside is really encouraging. Because I want to do it as opposed to being cheap.

• 19:33Speaker 03

  Meaning if you budgeted for it, it's easy for you to spend money, but if it's an unknown, like if something you didn't plan for, it's harder for you to be like Christmas dinner.

• 19:40Brian Preston?

  Is there anything you can do to accelerate your income journey? Because it sounds like y'all are giving everything you've got on Alyssa's side. But your side is kind of, is it just that you have to put in the time and be part of the pace?

• 19:51Speaker 02

  As an unlicensed electrician, there's very little that I really can do. I can't do anything with permits. But I do help people out when they've got little electrical things from the church or the community. So I'll do little stuff like that in a way that's in regard to legal penalties of such actions. But, you know, that in the future is something that's more opened up. Right now it's fairly constrained.

• 20:12Speaker 03

  You said, okay, one of the reasons you like budgeting is it allows you to like prioritize what's most important. When you think about these things you laid out, right? Like being more generous and the Kindle subscription. But also moving into a newer home, if you had to prioritize, what's a bigger priority for you guys? Having more flexibility in the little things today or being able to move into a new home sooner? Like, how would you guys prioritize those two things?

• 20:38Speaker 04

  I would say probably new home.

• 20:40Speaker 03

  Even if that meant, you know,

• 20:42Speaker 04

  We're still tight.

• 20:43Speaker 03

  Less being able to be generous and have people over.

• 20:47Brian Preston?

  But how in the world does that even happen? I mean, that's the thing. I know they have tremendous equity in the house, which that would at least allow you to get in.

• 20:54Speaker 03

  Well, that's where I'm going. I gotta, we gotta ask what the Denver market is like. What, for that types of houses they're looking at, what's the cost of a house to be reasonable for a family of five that you guys would be considering?

• 21:06Speaker 04

  Five hundred thousand. Yeah. Obviously, ours is at two ninety-five.

• 21:10Speaker 02

  To eliminate that, when we think about this, we're thinking about about a hundred and fifty, a hundred and sixty thousand dollar income. And just doing back of the napkin stuff, that would put us able to afford that in five or eight years.

• 21:22Speaker 03

  Okay. So it's more a mechanism of, we're already on this trajectory where we think we're going to be able to do this. We just need time to pass. There's not really a lot of stuff that can change today to make it happen sooner. It's a function of you working through apprenticeship and getting into where the pay gets really good.

• 21:38Speaker 04

  Yeah. Maybe not sooner, but I would say easier in the five years. Cause maybe one of the things that I would love your guys' opinion on is I think we should pay down the mortgage. That way, when we do want the other house, we could have more flexibility in the process.

• 21:51Speaker 03

  No, come on. No, go.

• 21:54Speaker 04

  You know what? That's what he's been saying to me.

• 21:55Speaker 03

  Ask her questions. Don't just say no.

• 21:58Speaker 04

  But I think, you know, five twenty-five.

• 22:01Brian Preston?

  I've already seen.

• 22:02Speaker 04

  I get that you said that's low, but it doesn't feel low.

• 22:05Brian Preston?

  I get that.

• 22:06Speaker 04

  It feels very high.

• 22:07Brian Preston?

  But, but y'all have already, I mean, cause you have a hundred and seventy thousand dollars of equity in this house. When did y'all move in this house?

• 22:14Speaker 04

  Um, year and a half ago.

• 22:15Brian Preston?

  How much did you put down on this house?

• 22:17Speaker 04

  We put down eighty, and then we've made an additional principal payment.

• 22:21Brian Preston?

  I think you've taken some liberties to be, you know, you've been paying down the mortgage.

• 22:25Speaker 03

  Hold on. You made an additional principal payment?

• 22:28Speaker 04

  We had, we received an inheritance.

• 22:29Brian Preston?

  Okay.

• 22:30Speaker 04

  And we put that towards it. And we actually have a little bit more that we have received that's sitting in our emergency fund. Our emergency fund is a little high. We typically like it around three months, two to three months.

• 22:41Brian Preston?

  Can I give you a mindset issue, though? You have a moment in time where y'all are just being squeezed artificially, because there's nothing else you can do to cut your, but you guys are literally the poster children of budgeters. I mean, y'all, I've seen your spreadsheets. Y'all are, every month, you've even got, you know, all these variances. So, you know, we always say you can either make more money or you can spend less. You're already budgeting, so you can't spend less. I mean, it's already there. We're done. We're at the bottom. And so you can't make more, you know, and then I ask you, can you make more money? You're like, well, I'm on this apprenticeship thing. I have to just put my time in. I don't think you can make more money.

• 23:16Speaker 04

  No.

• 23:17Brian Preston?

  So when liquidity came into y'all's system, that was the relief valve to get you through this season of time. When I, when I started my first company, I built up like fifty, sixty grand of cash, just so my wife wouldn't feel the pain of how bad it was going to be the first three years that we started this company. Y'all needed that liquidity to get you through this apprenticeship, because y'all are bearing the weight of the entire process with no relief. I know you think as a debt crusader, it's going to make you feel better, but as the tool of money, it would be better to have the extra liquidity, because then you don't have to feel all this weight, because you haven't done anything wrong. You're, you're, you're kind of punishing yourself, like a Kindle subscription, date nights with your

• 23:57Brian Preston?

  spouse. I mean, these are things that shouldn't be just thrown away because you're stuck in this moment in time. So I, I mean, I have to triage you where you are, and you can't get, unless you refinance, which that's not a good decision either, especially with interest rates where they are. It's just, but I would, I want, I need you to free yourself from thinking that, that you need to put more money towards the debt. That's not, that's not going to solve y'all's long-term issues. It's just not. Cause you need, y'all need to have more grace on yourselves to live life. And I'm not, I'm not getting on to you.

• 24:30Speaker 04

  No, no, no, no. No, I appreciate it.

• 24:33Brian Preston?

  Right now, cause I already.

• 24:34Speaker 03

  Sounds like you're getting on to her.

• 24:35Brian Preston?

  No, I mean, but I already, I've already had one conversation, and she's like, why are you yelling at me? Cause I was, she was asking for directions on the, I'm like, I'm not. I just, I get, when I get passionate, I'm loud. So if I apologize, if it came off anyway.

• 24:47Speaker 04

  I appreciate that. I think maybe.

• 24:49Brian Preston?

  Does it help, or do you, are you like, oh?

• 24:52Speaker 04

  Well, I worry that we, you know, keep this cash, and then we just have it as cash, but then don't actually feel comfortable using it, if I'm just thinking about my lovely spouse. That like, that we wouldn't, that we'd go, okay, well, we've got this extra cash, cause we do have the extra in the emergency fund that we've been waiting for.

• 25:10Speaker 03

  Inside your emergency fund, what do you consider to be the extra cash?

• 25:12Speaker 02

  Eighteen thousand.

• 25:14Speaker 03

  Eighteen thousand.

• 25:15Speaker 02

  And this is a good point to identify, too, another foo-ish opinion that we have. This one's mine. So I'm excited for this. But I would really like to have the capacity to start a business in five to eight years. I would then have my master's license. It would allow me to do all the things I would need to do. From, from all the work that I'm doing, I think I would really enjoy it. I think it'd be really what I would like to do in the longer term. So for me, I would rather have that liquidity in a brokerage account, so that we can pull it out, to be able to start that business, to have the flexibility to buy a truck, to deal with the fact that our income might go down, buy inventory, buy all that sort of stuff. My preference, as you can see, we've got that brokerage account, is to be able to put the money in that as opposed to the IRAs, which I know is where we should start.

• 25:53Speaker 03

  So there's a few things that are going to happen inside the next five years, three to five years.

• 25:56Brian Preston?

  All these things are in, are in conflict with each other, too.

• 25:58Speaker 03

  But I don't, I don't know that having a brokerage account, I think keeping it liquid makes a lot of sense in a high-yield savings, earning something. But in the brokerage account, you have, you know, risk of loss of principal, and all your goals are inside of three to five years that you're talking about utilizing that money for. But I also don't think it has to be all or, all or nothing. Now, when you talk about starting a business and going out on your own, is there a capital cost to that? You gotta like buy a truck and do that sort of thing?

• 26:22Speaker 02

  Yes.

• 26:23Speaker 03

  You have a ballpark number, like this is what I think it would cost, or what I would need to have to be able to strike out on my own?

• 26:28Speaker 02

  This is not a very informed number. We think it's north of a hundred thousand.

• 26:31Speaker 04

  Well, no, you think it's, okay, you think it's fifty thousand for the materials on the truck, and then maybe in the tools. And then we were thinking another fifty to a hundred for loss of income.

• 26:44Brian Preston?

  Yeah. I think that's probably a healthy way to look at it. I think that's exactly, cause I was sitting there thinking, there's two numbers, actually. It's the loss of income, cause that whole cushion you need to make it through life, while you're, it's going to take three years probably to build traction, but it probably is going to be fifty or so. I think a hundred grand is probably the number.

• 27:00Speaker 03

  What's a higher priority? Going out on your own or getting into a bigger house?

• 27:03Speaker 02

  There's kind of a natural pivot point around the same time. So we feel.

• 27:08Speaker 03

  Oh, just do both of them at the same time?

• 27:10Speaker 02

  Yeah. Incidentally, they kind of, there's, there's a, but here's what I'm saying. There's a natural inflection point where if we're going to start the business, I would love to move up to the mountains and live in a small town and, and live that kind of lifestyle. And so that's like, if, if we're going to do it, you know, that, that's a big commitment. That'd be selling the house. On the other side of that, we've also been.

• 27:28Speaker 03

  Small town, still a five hundred thousand dollar house?

• 27:30Speaker 02

  Yeah. It's in the mountains. So it's like, you're paying mountain free.

• 27:33Speaker 03

  It's more expensive.

• 27:34Speaker 02

  We've been looking at the rental market in at least a couple of these towns. And there's a significant amount of inventory around that three thousand dollar a month place with freestanding, multiple bedrooms, kind of what we would need. And I feel pretty bit by this house. Like, the amount of money we've put in compared to what we could have done by just investing that money in renting, it seemed really prudent to get into the housing market. It was something that I think we got really fair encouragement to do. But in retrospect, I really wish we hadn't.

• 28:01Brian Preston?

  You know, I know we, Bo and I usually, at the end of the show, we'll have a conversation of what the path forward is. But I'm so happy to hear y'all, y'all have the good sense to kind of see where this is going. Cause I've already told you, you can't make more money for this moment in time. You can't spend less, yet y'all are sitting on a hundred and seventy thousand dollars of equity. And I, the thing that rips my heart out is to hear y'all want to grow your family. But to do that in a two-bedroom condo seems less than ideal. I mean, cause when you get to be my age, the kids are going to be important. I mean, so you know, to not have a kid because of a lack of money, seems like a bad decision, too. And then we also want to start this company. I, I think you have to put all things on the

• 28:42Brian Preston?

  table, and I think probably selling the house is definitely a viable option.

• 28:47Speaker 04

  Yeah.

• 28:48Brian Preston?

  To, to unlock your options, and you rent a bigger house.

• 28:52Speaker 04

  Yeah.

• 28:53Brian Preston?

  Until y'all's income gets to the point that you.

• 28:55Speaker 00

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• 29:54Brian Preston?

  Transition from renter to now living your best life with owning the house too.

• 29:59Speaker 03

  Brian, one of my favorite moments on Making Millionaire is when a guest realizes something they never would have spotted on their own.

• 30:07Brian Preston?

  Yeah, I absolutely love that too. And these are smart people, but everybody has blind spots because you just don't know what you just don't know.

• 30:15Speaker 03

  And here's the thing, on the show, we get about an hour with our guests, but our abound wealth clients, we get to walk alongside them week after week, month after month, year after year through career changes, kids, college, retirement, and everything in between.

• 30:32Brian Preston?

  If you've been watching this thinking, I'd love that kind of feedback on my situation, we'd love to have that conversation. We're fee only fiduciary advisors legally required to work in your best interest.

• 30:43Speaker 03

  And just head over to aboundwealth.com or click the link below. We would love to connect and be a part of your financial journey.

• 30:49Brian Preston?

  One conversation's great, but having someone in your corner for the long haul, that's even better.

• 30:55Speaker 03

  What about not starting a business? What's the path look like if you go work through the apprenticeship, get your master license? Isn't there a job waiting for you on the other side of that?

• 31:04Speaker 04

  Great income.

• 31:05Brian Preston?

  What's a great income once you come out on the other side?

• 31:08Speaker 02

  So right now, journeyman wage is $50 an hour. And then there's benefits on top of that that end up being about 20. So they'll advertise it as $70 an hour. I would really like to be a foreman, I hope, and that would be 55 an hour and I'd probably get a work vehicle. So in terms of the starting the business in five to eight, that's a passion project idea. That's something that we're planning to have the capacity to do. There's a very real situation where we just enjoy the fruits of that, take all the money, sock it away, enjoy the lifestyle that provides and kick that can of starting a business down the road until it's a better financial decision.

• 31:44Brian Preston?

  Well, also so you can build the expertise to see everything you need to see to be a good business owner too. Cause that's, I have no doubt from the analytical side, you're going to be the opposite of most business owners in the fact that most business owners are really good at what the thing is, they want to start the business, they have the passion, but most of them are clueless when it comes to the accounting side of it, the bookkeeping and everything. Y'all have got that in spades, so I'm not worried about that. I'm worried, have you seen everything you need to see to be the best electrician, especially on the commercial side of things and you know, to be really equipped to be successful in the long term.

• 32:20Speaker 02

  Very fair.

• 32:21Speaker 03

  Yeah, just the idea of striking out on your own, right when you get to the point where you can finally start making good money from all the apprenticeship is a, that one seems, I don't say aggressive, but it just seems fast. Okay, I want to understand, from a savings standpoint right now, walk us through how you guys are currently saving. Like what are you putting, what accounts are you putting money into from like a future financial independence building standpoint right now?

• 32:44Speaker 02

  Effectively we're not.

• 32:45Speaker 04

  Effectively none.

• 32:46Speaker 03

  So it's really just you're letting your current assets grow, but you're living.

• 32:49Speaker 04

  Yeah, we do have.

• 32:50Brian Preston?

  Keeping your emergency reserves.

• 32:51Speaker 04

  I will say the brokerage, we've, I think that's all from mostly this year.

• 32:58Speaker 02

  Last 18 months.

• 32:59Speaker 04

  Last 18 months. So we've saved $16,000 in the last 18 months, but we haven't put it into retirement.

• 33:04Speaker 02

  If I can put a point on this, we budget, assuming we're going to make X. And then there's, there's like things that come up that make X plus N.

• 33:12Speaker 04

  Yeah, I make more because mine's, if I work extra hours, then I make more. I just bill however many hours I work. So that's really where that money comes from.

• 33:21Speaker 02

  Got it. So we, we pretty much, we do the opposite of what everyone says to do. We live to the point that we have budgeted and then we save the excess when there's excess. Not to toot our own horn, but we are actually accurate at living to our budget. I was going back through.

• 33:34Speaker 03

  I heard you turned away Christmas dinner. We all know that you can live by the budget. You came back home empty handed.

• 33:40Speaker 02

  I did not.

• 33:45Speaker 04

  But so I think that's where we look at our retirement and we go, is it good enough that we could just pause for a few years? That way we can have this flexibility of if you want to start the business, that way we have that cash on hand and we have that liquidity.

• 33:59Speaker 03

  This $150,000, is that like an accurate household income to project for you guys?

• 34:04Brian Preston?

  I think it sounds a little.

• 34:05Speaker 04

  I think it sounds low.

• 34:07Speaker 03

  Okay, what do you, what would be a household income, fast forward five years, assuming you don't strike out on your own?

• 34:12Speaker 02

  We would like her to be able to step back so that we don't have to do the childcare and so that she can work a little less and have more freedom to be with the kids more.

• 34:20Speaker 03

  Five years from now.

• 34:21Speaker 04

  But five years, yeah.

• 34:22Speaker 02

  Yes.

• 34:22Speaker 04

  We've got some younger kids.

• 34:24Speaker 03

  In my head, I'm trying to think through what, what we will project for you guys in terms of like building a plan.

• 34:28Speaker 02

  150, 160.

• 34:29Speaker 03

  150 to 160, five years from now, once you complete the apprenticeship.

• 34:33Speaker 04

  And then once the kids go back to school in 10 years, then I could go work more hours.

• 34:39Speaker 03

  Sure. When it comes to today's stuff, like the clothes, phone, do you not have a phone?

• 34:46Speaker 04

  No, we do. But like if I had to buy a new phone, that's coming out of my, my fun money.

• 34:51Speaker 03

  Got it, okay. Phone, Kindle, if you had to put a dollar figure on an additional amount a month that you guys could budget for, what would be a number that would allow you to do some of those things?

• 35:02Speaker 04

  Probably an extra 100 a person, maybe 150 a person. Cause when we were young dinks, loved that life, we had 250 a month in fun money and that was really comfortable. And now we've obviously scaled back to a hundred person, a hundred dollars a person.

• 35:18Brian Preston?

  I'd like it to be $400 a month.

• 35:20Speaker 03

  So.

• 35:20Speaker 02

  That's oof.

• 35:21Brian Preston?

  But too much?

• 35:22Speaker 03

  Two hundred each, right? Two hundred.

• 35:25Speaker 02

  Okay, no, that's fine.

• 35:26Speaker 04

  Oh, yeah, yeah.

• 35:26Speaker 03

  That's all, man. What I'm hearing you say, and I want to.

• 35:28Brian Preston?

  We've had inflation. Things are more expensive since y'all.

• 35:31Speaker 03

  If you had an extra $200 a month each, $400 total.

• 35:36Speaker 04

  Yeah.

• 35:37Speaker 03

  It would change the way that you live your current life.

• 35:40Speaker 02

  I think so.

• 35:41Speaker 04

  Yeah.

• 35:41Speaker 02

  We'd get into hobbies, we'd, we'd be able to go out and get coffees Saturday mornings, you know, be stuff like that. We'd be able to go like get a hot lunch sometimes.

• 35:49Brian Preston?

  It's bedazzling your basic life so you wouldn't look back on your early 30s and be like, what the heck were we doing during that period? Which like I said, y'all are so good.

• 35:57Speaker 04

  Which is.

• 35:58Brian Preston?

  But I hate that you're killing some of your happiness for such a small sum in the long-term amount.

• 36:03Speaker 03

  And what's your, so what's your current fun money y'all each have?

• 36:05Speaker 04

  We each have a hundred.

• 36:06Speaker 03

  A hundred, so we're talking about adding an extra two, an extra $200 for the household.

• 36:10Speaker 04

  Yeah, so 2,400 a year.

• 36:11Speaker 03

  I'm just, I'm just, I'm just thinking, you have this extra $18,000 in cash. If you just mentally compartmentalize and said, hey, we're each going to add a hundred dollars to our fun money per month, that's 200 extra bucks a month. Over the next three years, you're only spending $7,000 and that assumes no extra work, no, you know, none of those things. If you guys actually agreed, hey, we're going to let that be part of our budget, would you actually spend it and be at ease and at peace if it were in the budget, even though it's not coming out of cash flow, it's kind of coming out of savings?

• 36:44Speaker 04

  It's like a sinking fund of fun money.

• 36:46Speaker 02

  I'll answer my part first. I don't think I need it frankly. Like with the way that our, we get, I get some portions of some of the other stuff I do.

• 36:53Brian Preston?

  I see, I see the peer pressure.

• 36:54Speaker 03

  Oh no, you can have your hundred, I don't even need mine, whatever.

• 36:58Speaker 02

  This is a discussion we've had over time of like, look, I don't have the pressure to buy clothes like Les does. I don't have the pressure to do like certain spending things that you really, really enjoy. I, as just the tightwad cheapo, it doesn't bring me the kind of joy that justifies it. Whereas I would really be very happy, very happy if you were able to get some more.

• 37:17Brian Preston?

  Jacob, can I give you some advice?

• 37:18Speaker 02

  What?

• 37:19Brian Preston?

  You have a wife who loves you. Take this woman on a date. I mean, you need to, don't be such a tightwad that you don't take your wife out on a date because that's where that extra money should go. You don't think, I don't count on you to spend it on yourself, but I count on you guys to go out on a date together. Cause I can tell you, she, she's all about you. So you need to, you need to put in your part so she feels like, hey, he's putting in the effort as well to make sure this thing, and I'm not getting on to you too, because y'all are a great couple, but take your wife out on a date with that extra money.

• 37:52Speaker 03

  In reality, you're only 30 and 31 once and you're only going to have a two-year-old and a six-month-old once. You're only going to be this stage in this season once.

• 38:00Speaker 04

  Yeah.

• 38:01Speaker 03

  And you're already on the trajectory and path where your life's going to look very different five years from now than it looks now, if you change nothing, if you just, so you have the means and the mechanism, the capacity to make a very small change right now to improve your current life. Cause what we don't want you to do is wake up when you're 36 and you have three kids and now you have. Oh, we were gonna go on dates, but now we have sports and now we have, you know, whatever those things may be. If you can fix this problem right now with minimal effort and minimal impact in the long term, it kinda seems, I don't wanna say foolish, but kinda foolish not to. Cause you can't go back in time and change that. Once these years are gone, they're gone, you don't get them back.

• 38:45Brian Preston?

  Well, now, I wanna put a little thought in your brain. I could see when you guys start making good money, y'all might need to, at some point, transition. Do budgeting now, you need to. Some point, let loose a little bit, so it kinda becomes an automatic cash management, where everything's automatically going into the savings. It's going into paying all the, prepaying all the debts, or whatever else you have. But then, everything else beyond that, just go and live your best life, so that y'all don't have resentment. Because I see financial mutants do that sometimes, to the detriment of the marriage and the relationship.

• 39:21Speaker 04

  Yeah, I think that's a great plan, that we add some, take some of our extra that we've got, currently sitting in the emergency fund of that 18K, move that to a little bit of lifestyle flexibility.

• 39:34Speaker 02

  For sure.

• 39:35Speaker 04

  For the next few years. What should we do with the next 10,000? That was 8,000.

• 39:40Speaker 03

  With the, well, I think we have to figure out where the, where the hierarchy of our priorities are. Cause we've done a lot of stuff. Maybe starting a business, maybe selling your current house, maybe renting, maybe buying another house.

• 39:52Speaker 02

  Yeah.

• 39:53Speaker 03

  I don't know that, right now, we know exactly what the answer is. I don't know that I'd be super crazy to go deploy those dollars, I think leaving them liquid, as you begin to figure out where the priorities lie. Cause you're gonna know very quickly, okay, is there a house realistically that we can rent? Do we feel confident that we can rent it on a long enough term, we feel confident with? Cause what you don't wanna do, or I would imagine, is sign a 12-month lease, get into a house, love that house, and then after 12 months, it's not available anymore, and you gotta go change, and you're in this. Cause then you're gonna feel, oh my gosh, now we gotta go buy.

• 40:24Speaker 04

  Which is part of why we bought our place, cause we were like, we don't wanna keep moving. My gosh.

• 40:28Brian Preston?

  Well, I think, you know, I've picked on Jacob pretty hard. I'll be showing you a little bit, but I don't think you, you don't feel comfortable with money sitting in cash. I can already sense it. You want, you want everything to have a place to go, and that's why, when it does sit in cash too long, you're like, well, just put it towards the mortgage, cause we're paying 5 and whatever percent.

• 40:45Speaker 04

  5.85, and that's, it's a variable rate, it's an adjustable rate. But, look.

• 40:49Speaker 03

  When does it adjust?

• 40:50Speaker 02

  Six years from now.

• 40:51Speaker 04

  In six years. Are you gonna be in the house in six years? No.

• 40:54Brian Preston?

  Not with three kids or not. So, I think, but I can sense that about you, is everything has to have a place. But I think while y'all, y'all are in this season of transition, for a moment in time, you just have to be okay that there is a little bit of an opportunity cost, because it's building, y'all, y'all are so governed right now, you haven't reached your full potential, you're still in the growth phase of talents, the shovel, which is going to be so much more valuable in the long term, that it's okay keeping that extra liquidity, so y'all don't feel so squeezed. Cause I feel like that's, y'all felt pressure to make sure that the cash has a place, and it squeezed the liquidity to the point that y'all do feel so much tighter than you really need to at this point in time.

• 41:35Speaker 04

  Yeah.

• 41:36Speaker 02

  That's fair.

• 41:37Speaker 03

  What other questions do you guys have? What else can we speak to that'd be helpful for y'all?

• 41:39Speaker 02

  Oh, I wrote these down, and now that we've had such a good conversation.

• 41:42Speaker 04

  One of them was about our traditional IRAs. We lived in England for two years, and one of the years that we were, maybe both of the years that we were there, we messed up on our income, and contributed to our Roth, and we couldn't, so we had to convert it to a traditional. That's why we have these two, random traditional. So we've been thinking about converting them over to our Roths.

• 42:04Brian Preston?

  Meaning, were they non-deductible IRA contributions?

• 42:07Speaker 02

  I think so, we were over the Roth threshold, so I don't think we got the tax benefit in that first year.

• 42:12Speaker 03

  Did you have access to 401Ks in those years that you were working?

• 42:15Speaker 04

  No, because we weren't.

• 42:16Speaker 03

  I bet they were deductible, I bet they re-characterized Roth contributions to traditional contributions.

• 42:19Speaker 04

  We did do the re-characterization form.

• 42:21Speaker 03

  And you took a deduction likely in your tax return for it, would be my guess.

• 42:24Brian Preston?

  Okay, so there's no basis likely in those.

• 42:26Speaker 03

  Uh, and so your question is, hey, we've been thinking about maybe converting those to Roth?

• 42:30Speaker 02

  Given that we are at such a low tax position, like, I think our effective tax rate's 12%.

• 42:34Speaker 03

  But still, if you do that, you still gotta spend the money on taxes. So, while you could convert that, and you could turn those into Roth, if you're gonna do that, you might just, if it were me, I'd think about, okay, instead of converting that to Roth, why don't I just make direct Roth contributions? Cause then, I'm not having to pay any sort of tax on that.

• 42:53Speaker 02

  Okay.

• 42:54Speaker 03

  People get so excited, oh, I'm in a low tax bracket, and I can convert this to traditional. I think there's gonna be a means and method for you guys to be able to convert, or to be able to build Roth dollars in the future, especially, once you start working, you have access to 401Ks, let's say your income blows up to that $200,000 range, you're gonna have the flexibility there, that if you wanna build up Roth assets, you're gonna be able to do it, through Roth 401Ks, Roth IRAs. If you were gonna spend an extra $200 on something, I would spend it on date nights, instead of paying taxes for Roth conversions.

• 43:25Brian Preston?

  And Kindle subscriptions, everything you said there seemed.

• 43:28Speaker 04

  All the fun stuff.

• 43:29Speaker 03

  All the fun stuff.

• 43:30Brian Preston?

  That is stuff that seemed so just doable.

• 43:33Speaker 03

  Seems possible.

• 43:34Brian Preston?

  Y'all should do that stuff, you really should.

• 43:36Speaker 04

  Yeah.

• 43:37Brian Preston?

  And I love talking to you, I hope y'all don't think that we're too hard on you, but I just, I see so much potential. But I also see so much potential with huge horsepower motors, meaning your brains, but y'all are directing them, I think you're getting caught up in the minutia, instead of the big picture stuff, that y'all really need to be kind of working through.

• 43:54Speaker 04

  Yeah, yeah. Ultimately, 200 bucks a month isn't going to change our ability to retire.

• 44:00Brian Preston?

  You're gonna be my age one day, and it's good, you're gonna be like, why didn't we?

• 44:03Speaker 03

  It's so crazy, and this is so counter to everything you normally hear us say, or financial people say, 200 bucks a month likely will not change your future, based on your trajectory. But 200 dollars a month will very much change your present. And that's something you should like, factor into the equation.

• 44:18Speaker 04

  Yeah, yeah.

• 44:19Speaker 02

  Yeah.

• 44:20Speaker 04

  Maybe, maybe, last question, is just thinking about our future. When we look at our retirement, of what we have in retirement savings, we're like, okay, we're, we feel like we're in a comfortable spot, we think we're.

• 44:31Brian Preston?

  You're ahead of the curve.

• 44:32Speaker 04

  Yeah. It's not gonna kill us to not save in the retirement this year, last year, we're gonna be okay. And in the future, when we've done projections on how much do we need to save, and by we, I mean Jacob, when Jacob's done these projections, we go, we think we could be okay by only putting aside 15% of our income, right? Of, is that foolish to do a lower percentage, if we look at it and we go?

• 44:56Brian Preston?

  I think it's a mirage to you right now, because y'all are thinking, here's where, I'll give you the exception to what you, I just told you. Y'all think, right now, about everything, but then, when you now go to the broader sense, you're like, we'll just do 15% forever. There's gonna come a time where you're gonna start feeling flush, and that 25% is gonna seem reasonable. Right now, 25% is like, what the heck should we do? But, and so, I get that. I don't wanna tell you right here and now, that 15% for the rest of your life is gonna do, it's, it should be better than the average American. But, I think that you're, just because I see the potential y'all are building, that's, that's not going to be your best life. I think you can get it all.

• 45:35Speaker 03

  We have a deliverable at moneyguy.com/resources, that shows how much you can save at each age, to be able to reach your financial independence by age 65. And for a 22-year-old, it's really only required, if you save 6%, you'll get there by 400 retirement age. If we could rewind to your 22-year-old self, and I told you, hey guys, you don't need to save, like, that 20, 30, 50% yours, just save 6%, and you'll be okay. And then, life happened, and you end up in the place you are now, how happy are you right now, that you saved more early on than you quote-unquote had to?

• 46:10Speaker 04

  Thrilled.

• 46:11Speaker 03

  It thrilled, right? In our experience, people arrive at that same conclusion as they get into their 40s and 50s. While, yeah, could, could they have gotten away with saving 12%, 15%? Sure. But the fact that they got to that 20, 25% saves, it allowed them flexibility and options much earlier in life than they would have otherwise. And so long as it's not causing you to sacrifice today, and not do the things that you enjoy, when you have the ability and propensity to save that way, we think you should.

• 46:39Speaker 02

  Okay.

• 46:40Speaker 03

  Because it gives you that flex, flexibility, and you reassess it, and that's why we do the annual net worth statement, you reassess it, you use the know your number tool, you figure out, okay, we're ahead of the curve, behind the curve, on the curve, and then you just make that assessment, every single year.

• 46:52Brian Preston?

  And when y'all reach y'all's full potential, you're gonna be so ticked off with how much in taxes you pay, that the best place to hide it legally is going to be those retirement accounts. So, so trust me, it's going to happen. Y'all just, you haven't reached your full version of yourselves yet, and that's why I get so excited, cause y'all are making very mature decisions, you're way ahead of the curve, but you're only 30 and 31. I mean, y'all, holy cow, I mean, a person my age looks at y'all and sees so much potential, you just have to be patient. It will, it will happen, but you just don't let the, the, the vision of right now screw up something, so that you're not having the filled vision for the long term. Cause I think y'all are going to reach it.

• 47:34Speaker 02

  Great.

• 47:35Speaker 04

  Yeah.

• 47:36Speaker 03

  Awesome. I'm excited, I feel like, I've got some decent stuff here, I think we're gonna put together a pretty exciting plan, maybe not for what 65 looks like, but certainly what the next five, 10, 15 years could look like, and I think it's gonna be great.

• 47:48Brian Preston?

  I feel like I'm the ghost, what, you're the ghost of the past, or the ghost of the future? I feel like we have fixed, we've done the Christmas Carol, right here today, with you guys, and I'm excited for the date nights, and the feedback, and everything else y'all go share with us after this.

• 48:03Speaker 04

  Yeah.

• 48:04Speaker 03

  Awesome. Thank you guys so much.

• 48:06Speaker 04

  We appreciate it.

• 48:06Speaker 03

  Brian, what a great conversation we have with Jacob and Alyssa. I'll be honest, I like them. I like them a lot.

• 48:13Brian Preston?

  I feel like we use the terminology, "our favorite guest," over and over. But it's really, when we do this Making a Millionaire, we get great, great people that come through the doors. And it is one of those, because you can't help, because what I loved about this couple is that they obviously love each other. But man, oh, man, you just want to look at Jacob and be like, dude.

• 48:32Speaker 03

  Come on, man.

• 48:33Brian Preston?

  What are you doing? I mean, when your wife tells you, "Go to the store, buy me Christmas dinner and bring it back." This is not the time to be young Ebenezer Scrooge and come back. That definitely is drifting from financial mutant to financial miser territory. But I think we got to him. I think by the end of this, he's not going to be trying to skip any more Christmas dinners.

• 48:52Speaker 03

  Yeah, but what I imagine is one of those things, it's like, you know, the first time you go to the gym, oh, yeah, I love it. But then you need some motivation for that staying power. And so we said, what's something we could do from a planning perspective to really help them actually do this? So this is what we did. We decided off the bat, like right at the very beginning, because, look, we said, hey, what would you do if you could spend more money? And she said, oh, I want to do an Amazon Kindle subscription. And he said, maybe a new house. Okay.

• 49:17Brian Preston?

  Yeah, one of these is not the same.

• 49:18Speaker 03

  One of these is not like that. So let's start with the small stuff first. We said, hey, you guys are in a position, you've done a lot of the hard work thus far. What if we just took some of your excess cash? And we just chiseled out a specific sinking fund for spending money? And I know that's so counterintuitive, what a lot of financial advisors say, but I think it's important for them, because it will change the way that they are enjoying their lives. So we said, let's just take three years, 36 months, and an extra $200 a month. And let's put a sinking fund of $7,200 in place. That $100 for him, $100 for her, that they have to spend every single month.

• 49:54Brian Preston?

  This is worth repeating. We are basically, as financial advisors, saying, pause saving and investing for three years. And on top of that, spend more money.

• 50:04Speaker 03

  That's it.

• 50:04Brian Preston?

  I mean, because this is one of those things, because they are in a season of life with young children. And Jacob's in a, also, season of life of training, where his income is somewhat suppressed, because he's changed careers. But he's on the path to be making a lot more money. But I love the fact that this is what, because I joked with him, I was like, Jacob, please take your wife on a date. And then we were joking behind the scenes, that if he doesn't take his wife on a date, what should he do with that money?

• 50:30Speaker 03

  If you do not spend your $100, you got to send it to us. And we'll take our team out to lunch.

• 50:34Brian Preston?

  We have no problem spending your money, Jacob, so make it happen.

• 50:37Speaker 03

  So you choose. You either take her on a date, or you just send us a check every month for a hundred bucks, and we'll knock it out. Because I think what you're going to find is, even just that small change, is going to add a lot of utility. It's going to add a lot of joy to the life. So then you can continue in the path that you are. Because again, you guys have done a lot of really great things. So from a planning standpoint, we said, okay, we're going to pause saving and investing for three years. I know that's going to feel weird, it's going to sound counterintuitive, but you've done a lot of the hard work to give yourself this flexibility. But as you begin to work through your apprenticeship, as you begin to get into the part of the career where you're actually starting to make money, what we projected is that you're going to make an income household of $160,000. If that's the case, we think an appropriate saving strategy for you guys

• 51:20Speaker 03

  might look something like putting $1,354 a month into your 401K. We want you to max out each of your Roth IRAs, $7,500 each. And we want you to max out the family HSA. If you just add those numbers up, it comes up to $40,000. That's a 25% savings rate. So yeah, I took off three years. I was not adding, I was not saving. But as soon as the income gets to where we can save the way we want to be saving, we're going to start saving $40,000 a year.

• 51:49Brian Preston?

  Well, it's pretty exciting, because I can't wait to actually run the projection to show everybody what happens when you have a young couple that has close to $300,000 at their age. But here we are, as advisors, telling them to take three years off. But there was a bigger elephant in the room. Because remember, Jacob just boarded up. Need a new house. And it makes sense.

• 52:08Speaker 03

  Kindle subscription, new house.

• 52:10Brian Preston?

  Because they have two children, and they're in a two-bedroom condo. Something's got to give. And then they've also been on this journey. They were debt crusading. They were trying to pay off all this debt. So there's been a revision. Let's go ahead and answer, what happens if they get a new house?

• 52:23Speaker 03

  Well, I think that probably they don't necessarily have to have it right now. But if there's a third child that comes along, they probably are going to run out of space. Well, one of the things we said is, okay, debt crusading and paying off the mortgage may not have been the most optimal, most advantageous strategy. But what it did do is it created a lot of equity in their current condo. So they're going to be well positioned for a down payment on that next home when they do that. So we said, one of the things they might want to consider is when it's time, consider selling the condo and renting a house that makes sense for the family. At least that way, they can figure out where they want to be, what the lay of the land looks like. And that way, they're not rushing into one housing decision to another. They're going to take the proceeds from selling their condo. They're going to put that in a high-yield savings account.

• 53:06Speaker 03

  And it's just going to sit there, and it's going to stay apart, so it can grow for them. And then, once they've figured out the lay of the land, once they've figured out where they want to be, and what kind of house they need to buy, and what makes sense for their family, they can use as much of that $170,000 of equity as necessary to get back on the homeownership train. And I think so many people, especially motivated, driven folks, think, okay, once I'm a homeowner, I got to stay a homeowner, and I got to do it. I think this is a prime example of where renting for them might give them the necessary flexibility to choose exactly what they want the next phase to look like.

• 53:38Brian Preston?

  Remember, they shared during the interviews that the new, next house is going to be $500,000 to $700,000. That's going to be a lot of pressure on that 25% of your gross income for housing. So I love the fact, because once you go, remember, he's in an apprenticeship. So he'll be coming out of that within the next three years. But then his income will still be on this upward trajectory.

• 53:59Speaker 03

  That's right.

• 53:59Brian Preston?

  I think that that additional time of renting will give you a little more time to kind of even out what his income actually look like, so it doesn't put so much pressure on that 25%.

• 54:10Speaker 03

  And so the question becomes, okay, well, they're doing these big things. You're telling them to spend money, and you're telling them to not save. How does this actually play out for them? And if you remember, the plan is, you have the money right now that's working for you. We're not going to pull any out, we're not going to do that. We're just going to let it sit and continue to grow, almost kind of coast for a little bit. But once your income gets to where we want it to be, we want you saving 25% of your gross, that's going to be $40,000 a year. Well, starting as a 31-year-old, okay? So not saving for the next three years, getting to 34, then just saving that $40,000 a year. Again, if we assume an 8.9% rate of return on your investments, by the time they get to 40 years old, they will have crossed into the two comma club. They'll have a million bucks by 40 years old.

• 54:53Speaker 03

  By the time they get to 45, 1.8 million. By the time they get to 50, over $3.1 million. And look, there's so many variables, so many changes, small biz, all this other stuff, that we didn't even project this out to 65, because a lot can change. But if they just stay on that path of saving 25%, even though that they're spending more today, even though they're going to take a pause and hiatus on saving, they're still going to be in a great position. And that's a testament to the hard work that they've done up to their current age, building nearly $300,000 in retirement assets.

• 55:26Brian Preston?

  And I hope they hear that. That's the part that I hope sinks in. Is because for natural savers, taking three years off is going to hurt. Use this slide right here as motivation to say, it's okay. Focus on living my best life right now. Focus on getting the income up through the apprenticeship. But Jacob and Alyssa, so, so exciting. I think they have so much that they're doing in great ways. You know, bring this full circle. I always love kind of closing things with putting a bow on top of it. This is two longtime friends. They meet in Europe when they're both like studying abroad. They come to Nashville, you know, to start dating, after, you know, hanging out over in Europe that time.

• 56:09Brian Preston?

  Now for them to come back to Nashville, for us to give them purpose with their financial life.

• 56:14Speaker 03

  I love it. It's a Hallmark movie.

• 56:16Brian Preston?

  Chef kiss. They really are an incredible couple who's on their journey to building their great, big, beautiful tomorrow. If other people want to be like Jacob and Alyssa, how can they apply?

• 56:27Speaker 03

  Yeah, if you want to be a guest on Making a Millionaire, you can go to moneyguy.com/apply. Or if you want to check out any of our free tools, free calculators, or free resources, go to moneyguy.com/resources.

• 56:37Brian Preston?

  And Jacob, enjoy your Christmas dinner. I'm your host, Brian, joined by Bo, Money Guy team, out.

• 56:45Speaker 07

  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 Making a Millionaire. The information provided is for informational purposes only, may not be suitable for all investors, and does not constitute financial, tax, investment, or legal advice. All investments involve a degree of risk, including the risk of loss. The guests featured on Making a Millionaire are not clients of Abound Wealth Management at the time of recording. Their participation should not be considered a testimonial or endorsement of Abound Wealth Management.

• 57:30Speaker 07

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