Are You a Wealth Builder Or Buster?

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Can't be combined with any other discount, including but not limited to contract and/or special price, loyalty programs, subject to terms and conditions, details at Lowes.com/Turors, subject to change. Are you a wealth builder or a buster? Seven questions you need to answer? The TLC episode. Brent, I am so excited about this because when it comes to being wealthy, when it comes to being a mentor, having financial success, when you look at all the people that have been able to do that, all the people that have achieved that level, it seems that there are some common traits, some common characteristics that exist amongst that population. So if we can define what those characteristics are and then ask ourselves a question, do I possess these characteristics, it should give us an indication of, are we on the right path? Well, and we're like, look, somebody who has literally written the book, Dr. Thomas Stanley and Danko, when they did the millionaire next door, they list the seven traits that millionaires have. Now, we took some, we massaged a few of these to bring them up to 2026 as we cover it. And we also were like, while we're doing this mashup, why not incorporate also? Because I couldn't help but think about it when you're thinking about wealth builder versus a buster or said differently, buster, why not bring this out too? We have six TLC references in today's show because today we don't want no scrubs. And I want to invite you to figure out if you can find all six of them and put them in the comments. I love it. I love it. All right. Let's talk about the very first trait. And this is one, I would say a money guy echo, but they probably were saying it before we started saying it, but it's something you've heard here a lot. Answer this question. Do you live below your means? Are you actually saving and deferring a little bit of today for a great, big, beautiful tomorrow? And I think, Brian, most Americans, they actually don't fall into this camp. No, there's, you know, look, we've known this, most people are busters. And the fact that they just don't live within their means. I mean, they're basically using leverage, they're using debt, they're living a life beyond what they actually can afford. So I don't like the living paycheck to paycheck, you know, and that's the thing Dr. Stanley said, operating a household without a budget is akin to operating a business without a plan without goals and without direction. So we got to do better than that. Yeah. If you're someone who finds yourself not doing this well and you recognize it, man, at the end of every pay cycle, end of every month, there's just not enough money left over. Perhaps you should start budgeting. Are you at least just listing out where are my dollars going? Because it's hard to know what to change and what to alter if you don't have a clear picture of where those dollars are disappearing to because when it comes to changing your financial life, most of us really only have two options. We can either make more money, increase our income or we can spend less money to create that margin. So you have to figure out which one of those two do you have control over and what are the steps that you can take to move into that direction? The next one, question two to ask yourself. Now, Dr. Stanley, when you read millionaire next door, he frames it as time, money, and energy. Like, well, energy, I would, I would rephrase it as our three ingredients to wealth building, which is, are you making the most of your time, money, and discipline? As I just alluded to, we lay out that there are three key things and we've kind of, if you kind of look at this in the order that we typically talk about it, I go backwards discipline. Are you exactly the point of the, the first thing we covered is, are you living within your means or on less than you make? If you do that, you'll create margin or the money that if you give it enough time, this thing gets magical with this power of compounding growth. And what's really interesting is no matter where you are in your financial journey, the amount of these ingredients you have available might not be the same. You might be someone who perhaps you didn't figure this out early on in life. And so you don't have as much time. So that means you have to increase how much discipline you're exercising or maybe you are brand new in your financial journey and it's very difficult for you to create a ton of margin or ton of money in your life. But if you have a lot of time, you can then use that to your advantage. So you have to figure out where do I fall and each one of these three ingredients and how can I maximize them for my own personal benefit? So at the end of the day, make sure you respect the three ingredients to wealth and don't go chasing waterfalls. All right. Let's talk about question number three. When you think about the way that you consume, do you value financial freedom over financial status? And I think that most people, especially in this country, they care more about the way they look, the way they perceive, the way that they show themselves the world around them rather than what their balance sheet actually says. We have a show coming up that I can't wait to record where we show just three small decisions in your life will change how your entire wealth building journey goes. And that one of them I'll go ahead and give the kind of peak behind the curtain is the car you drive. And because I can just tell you in my own life, I've watched so many of my friends, family and peers who as soon as they graduate and get their first big job, they go and load it up with the new car loaning. You see that across the board with most people. And I think you have to quickly realize if you're going to be a financial mutant, you value more the freedom than definitely how you look. And if you don't believe that this is what true wealth builders do, look at the stats on the top car brands that millionaires are driving. And it's no surprise that Toyota's number one is 16%. Honda's number two at 15% Ford with that F-150 stat, the million next door made famous, you know, is right there, Lexus, Subaru, surprisingly BMW is number six. But it is one of those things where I think when you look at this data, it doesn't shock me to see Toyota and Honda at the top of the house. Yeah. When you think about millionaires, they value staying out of high interest debt. They value building up their investments. They value building up and saving for large future purchases. They don't care as much about what other people think they care more about how they're providing and saving for their future financial self. I think the big takeaway is that with truly being wealthy, wealth on your net worth statement is stealth wealth. You don't hear it. In other words, you got a creep. I'm telling you, you know, do it stealthily and creep. All right, let's question number four that you're not doing a good job of like hiding this thing, but we're supposed to be putting pine straw in the break. You think I'm the one giving it away? Okay. Just back on. Stay cool. Oh, yeah, no, that's cool. That's on me. All right, I'll do better. All right. Question number four, when you think about how you're building wealth, are you building wealth without parental support or you someone who actually was able to leave the nest and get out from under the wings of your parents, meaning that you are self-sufficient and dependent without someone else pouring into you economic outpatient. Yeah, listen, we ain't too proud to beg, but at some point, she have to ask and figure out, do you really need help or can you do this on your own without help from loved ones? In a survey that we do for our millionaires and our bound clients every single year, we ask, hey, how much did an inheritance play a role in you building wealth and you getting to the financial status that you're at and 74% of our clients here to bound wealth received less than a $25,000 inheritance on their way to reach $1 million. So what that means is these are first generations self-made people or people that were not depending on their parents to prop them up to get them to financial status. In my way, it's not just our surveys. This is one of the big stats that came out of a millionaire next door that shocked me, it was because they had 80%. I know when Sarah, you know, Dr. Stanley's daughter came out with her, the updated version of the, the next millionaires next door. She also found the same stats as well as Ramsey Solutions found it in their own surveys. So this is a pretty consistent throughout the ages. It's close to 80% of millionaires are first generation, but that also means 70% goes by second generation, 90% by the third with the grandkids, be deliberate with how you're using your money. And this actually goes both ways. One trait is that that millionaires don't receive economic outpatient care from their parents, but they also have the ability to build self-sufficient children on their own. Millionaires have the tendency that they teach their kids how to make wise financial decisions, how to fly out of the nest and be self-sufficient on their own. Yeah, I mean, that's why here's a shock stat for you. 75% of parents are supporting at least one of their adult children out there to the tune of around $7,000 a year according to AARP. This is one of those things where look, I know we love our children and I think we get a lot of pushback whenever I cover the financial order of operations, would the fact that we have, you know, there's a reason we have the diploma. I mean, the, the, the capping gown on step number eight is that we want you to build your financial security first before you help the kids out, but also we want you to build, help them build the skillset to have independence. When I gave you that 70% is gone by first and by second generation, 90% by second. This is so you don't have to fall into that trap. Make sure that your kids best days are not just the days that they live under your roof. And again, it's just, it's worth repeating. It's okay if you help your kids out. If they're in a tight spot or maybe you have the means and mechanism to create an opportunity for them that might not have been available. Otherwise, that's different than subsidizing lifestyle. If what you're doing is covering the mortgage payment or covering the car payment or paying for the fill in the blank, that's where the line becomes very blurred and it can be not a super great situation. Yeah, and I just don't like these results definitely end up being unpretty. All right, Brian, let's look at this next question. Number six, are you good at identifying market opportunities? When Dr. Stan, Dr. Stanley, Dr. Danko looked at their millionaires. They found that their millionaires could find specific niches and they were able to take advantages of needs in the marketplace to find ways to position themselves for the opportunity to build wealth. They didn't sit back and let life happen. They were very proactive and opportunistic when opportunities presented themselves. Yeah, I mean, this is one of those things. One of the big things we're always talking about is always be buying is because I think that all humans struggle with this fear and greed component. But I think once you build a little wisdom or depth of understanding of how money works, you're going to find that you won't be prone to all those emotional things and you'll be right there in the right position with your cash, with your structure, with your financial order of operations, to where you get to identify and then maximize any market opportunity that comes your way in life. And then one of the final things, one of the ways that you make sure you're recognizing opportunities is did you choose the right occupation? When you set out to say this is what I do professionally for my career, did you choose an occupation that aligned both with what the marketplace desired as well as your unique skill sets? Yeah, something you want to know is that not everybody's a brain surgeon, not everybody's a professional athlete, you'd be kind of shocked to see the typical careers that millionaires occupy are everyday things. It's like your engineers, your accountants, your teachers, your management, your attorneys. These are people who consistently are just saving and investing, putting money forward, consistent income that allows you to let this wealth build up slowly in the background. Yeah, they provide ample opportunities, jobs, stability, stable income, the ability to create margin, the ability to exercise the three ingredients of wealth creation. So if you're going to summarize what these seven traits were, these seven questions you ought to ask yourself, this is what's true of millionaires of people that are able to build wealth. They live well below their means. They make the most of their time, their money, and their discipline. They value financial freedom over luxury or financial status. They don't depend on their parents' financial support. They have self-sufficient children. They recognize and take advantage of market opportunities and they chose the right job and they chose the right vocation. At the end of the day, I want you to be a builder, not a busta, and how you do that is with the financial order of operations. If you were one of these people just like I was, just like Bo was, where you don't come from money, but you have a lot of ambition. You know, you want to better yourself. We have created the thing to tell you exactly the instruction manual to know what to do with your next dollar. Right, I love that we get to sit here and we get to define what makes a builder and what makes a buster. And we can even answer your questions around how do I make this decision as a builder and not a, not a buster. And so with that, we want to answer your questions and load you up. So if you have a question right now, we have the team out in the wings collecting them, make sure you get them in the chat because we do believe there's a better way to do money. Now, Ruby, we in, in just the, as you can see, we, we surveyed our clients in that content showed up in this right now. I would be a mess if I didn't share that there's a lot of wealth builders who could share what they're doing with their money right now through our listener survey. Can you give us some details on that? Com slash survey. If you want your voice to be heard and your voice and perspective to shape the money guy show really into the new year and for the whole next year. Every fall, we give our audience a chance to fill out the financial mutant survey and tell us where you are. What are your pain points? What does your financial situation look like? What problems are you trying to solve and how can money guy help you figure that out? That's what it's all about. So that survey is only going to be open for one day more. So this is your last chance to get in and figure out how your voice can shape the show. And I really mean it. I want to know if you are still paying off debt. I want to know if you're on step none of the food or if you put your coast fine number or if you're in the messy middle. I want to know all of it because we want to know who is out there listening and how we can speak to you specifically. So I'm very excited about that. Be sure to go out to money guy dot com slash survey to take part of that because we're going to be creating not one but two episodes off of that content sharing the results. Yeah. This thing closes down in the next day. Correct. Yes, sir. I need you guys to do this, you know, because it really we count on the more of you who get in there and do this survey, the better the content gets because we actually get the numbers that make this more worthwhile and I think have a bigger reach. So I do love for everybody to get in there. Help us out with this. Y'all know when we when we do these surveys and stuff, we don't pepper you with a lot of things. We're just trying to get the best information so we can give you the best content and make it the most educational version that it can possibly be. Yep. Love it. Well, I don't get the feeling that you're a big TLC fan like I am. I knew well, I knew. Do you remember told a request life? Was that big? Was that big in your career? I remember he's you know, he's on the day show every morning. Didn't know that. I mean, I did know that but I don't like well, I'm not familiar with that. But I remember TLC when they had like TRL like hits like no scrubs. I got that. I mean, you are you're a little under you true. If you were watching TLC when they were really hot, I'd I'd question you already, you know, some questionable things in your your child raising already. But it is one of those things where I was needy pin college when TLC was really popping. Oh, yeah. So and I can remember I don't mind sharing that I still because back in college, there were two bands that just seemed like anytime you turned on the radio, it was a lannismore set and, you know, all of her really ticked off at the full house guy stuff that was out there. And then there was TLC. And I remember when the song don't go chasing waterfalls came out because AIDS and all these things that were MTV was just everywhere. I got to the point. I didn't even know what gaslighting was, but I had convinced everybody any time don't go chasing waterfalls came on. I would tell everybody it was my college room mates favorite song. And it eventually I was just broken, but where he just agreed this now, now when I take every time that song comes on, because my youngest daughter loves TLC. We listened to a lot of TLC in my car drive into school because she likes all the old R&B songs. We have to do the clean version. And fortunately, it was much easier back then. It feels like clean versions exist much more back then than they do now, but she loves also that. And every now and then I'll take a picture of screenshot and send it to my college roommate. Just thinking of it, but man, thinking of you because your favorite song came on. And I don't know why that's so entertaining to me, but it really is. And I've been a casual listener listening to this episode. I don't think I'd have gotten all six. I'd have gotten, I think probably three of them, maybe four. I bet people got six. Not a chance I'd have gotten all six. Plus, you didn't do a good job of hiding it. Oh, yeah. I was the one who was you snickered every time I did it. I laughed every time he said, Busta. I mean, I was trying to get him to change the name of the show to Busta. Nobody would do it. They actually want to use Buster. Buster. That's so boring. Well, you were like, you really covered the faces though. Content team was with me on this thing. Y'all are down. Great. Y'all did great. Are you going to ask us for questions? We absolutely do. Galaxy 9 is up first. He says I'm 30 years old, married, with the second kid on the way. Congrats. Cash reserves are great, but baseline expenses are climbing. How do we present, prevent lifestyle creep, quote unquote, versus legitimate family budget growth? Yeah. I think this is because you've heard us say, Galaxy, that lifestyle creep gets such a bad rap. And it's always perceived as this negative thing. But the increase of our lifestyle through time is not a bad thing. I think most people want their 30s lifestyle to be better than their 20s lifestyle. They're 40s to be better than the 30s, so on and so forth. And so the question you're asking is how can I do that, but make sure that I'm not doing it wrong or getting it out of whack? This is one of the reasons why we love the idea of paying yourself first. So when you get pay raises, when you get bonuses, what we want you to be doing is shooting for and striving to get to a 25% savings rate. And while you may not be there today, maybe your 30 years old and you got these two kids or you got the second kid in the way, and you're at a 15% or 60% savings rate, that's fantastic. What we want you to do is as you have a bonus come in or as you have a pay raise come in, have some portion of that automatically go to your savings. So I'm going to increase my savings rate from 60% to 70%. And then with that, I'm going to say I'm going to say I'm going to do that, and then the remainder, what's left over, it's totally fine for that to go to livestock, for that to go to increasing whatever those things are. It's not like every additional dollar you make has to be saved. So if you can save first and then spend, you're going to keep yourself on solid financial footing through time and make sure you don't get out ahead of your skis. Got it. I need you to have accountability because this is, we just did a show that did really well, by the way, the wealth window because I've heard nobody else talking about, you know, yes, of course, if you can start saving and investing in your 20s, you're going to be golden. But most people just don't have that margin in their life. So it's really that period of time between 32 to 48 that you got to get the work done on saving something for the future. But the problem is that's also when life starts really stretching on you is because you have kids, you get married, you start having to buy, you know, think about houses, all the activity fees for the kids. We're just here to tell you there's nothing wrong, exactly what both said with your lifestyle growing during this very important season of your life, but I just want you to be whispering and pushing a little bit of the small, you know, as you get incremental pay raises because that's the other thing the data shows is that you are getting more mastery in your career. You're getting bigger pay raises. Make sure some of that's showing up on the network statement, you know, and it doesn't have to be all of it. Like, you know, a 60, 40 split is what we talk about with pay raises is let 60% go towards your automated investments. And so you can ultimately get it up to 25% of your gross income, count that employer match if your income's under $200,000, but do something so that money's growing so you don't get into your, when you get to be my decade of in your 50s and beyond and have huge regrets because you didn't take any bit of time to sacrifice and build something for the future. Galaxy 9, thank you for the question, fellow messy middle, represent. Shay S is the next, what, what do you think was that the equivalent of saying Busta? No, you know, that's, yep, you're great. Okay, we're going to move on to Shay S's question. What happens to my HSA after death? I'm 44, today I have 90K and I max it annually, investing and never using it. Well my kids be taxed, can they use the funds if they don't have a high deductible health plan? Interesting question. We love HSA. Yeah. What happens if somebody inherits me? I mean, we did a full deep dive HSA show. This is probably a number of years ago, I mean, we've been doing this since 2006, so things, but this part of the tax code hasn't changed. I know for a fact it hasn't. And we actually shared the tax code in that earlier episode to where it showed that indeed your executor or executor tricks can, can indeed go back and claim that tax-free distribution from the health savings account, but you make a great point, Shay. If you have, if you're doing this strategy where you're, and for those who don't know, we love health savings accounts because they are triple tax advantage. It's one of the few vehicles out there where you get a tax deduction for your contribution. It grows tax deferred while it's in the account, and if you pull the money out for qualified medical expenses, it grows completely tax-free. So you got it all, you got going in and coming out if you structure it right. So that's why there's a lot of incentive to not use it as a clearing account, but to actually let the money grow and invest, but you probably need to write a note to your executor, put it with your will and all of your other important documents, that this is what you're doing so that that is not, you know, overseen, because it's sometimes chaotic after you put, leave the earth, you want to make sure you let the people you love know what you're doing. Yeah. If the, if your estate does not have copies of the receipts or of the charges, they won't be able to reimburse that money for free. And then once you pass, you can't then use those dollars in the same way that you could prior to death. So one of the things that we tell our clients to do is we love building up HSA, treating them like long-term retirement vehicles. But what is up happening, and this is what we've seen practically is someone who built up their HSA and they might have 100,000, 200,000, a substantial sum of money in there, and they'll have all these expenses that they've accumulated over the last 30 or 40 years, where they could reimburse themselves if they need to, but what they'll start doing is they'll just start using that for their retirement medical expenses. Hey, I had to go do this thing. I'm going to use my HSA. Okay. I got to go to this and use my HSA. And then if we're doing some tax planning, we get to the end of the year and we're like, hey, I know we did that tax planning where we wanted to make sure we stayed below the Irma surcharge, but we're going on this trip and I got to make it deposit and so I need $10,000. What do I do? Well, the HSA is a great place to go get tax-free money for those expenses that maybe you weren't counting on that won't affect your other tax plan that you're doing. So our clients kind of use it as a current medical expenses and retirement plus one off, uh-oh. I didn't know I was going to have this expense need and it's tax-free, completely available money. So those people end up, and most people spend them down, I would say relatively quickly in retirement. Very rarely do I see someone passing away with a large HSA balance because it usually shifts once you retire. I've seen it with clients where we've done it during Roth conversions, when we're doing Roth conversions and we need to legally manipulate the tax code. And I've even seen it when we're downsizing like a house and we haven't so we're, you know, we didn't sell the first house, we built the new, our move to a retirement community and there might be a little overlap before you sell the old house. HSA is a great place to grab that money without a tax benefit, without a tax issue so that we can make the transition to a smaller home and then sell and then re- you know, load the money back up into your taxable accounts. Yep. When you need to build up your team to handle the growing chaos at work, use indeed sponsor jobs. It gives your job post the boost it needs to be seen and helps reach people with the right skills, certifications and more. Listeners of this show will get a $75 sponsor job credit at indeed.com/podcast. Need a hiring hero? For this is a job for indeed sponsor jobs. Let's go ahead and get started. Say thank you for the question, appreciate you being here. If you're watching us live right now, be sure to get your rapid fire questions into the chat. Just put RF at the beginning of your question and we may choose that for our rapid fire segment coming up a little bit later in the show. And also even if you're not watching this live because this will stay up and go out there, do the survey. We really need people because I asked Rebi, I was like, Rebi, how are the numbers looking? You're like, good. But man, it would be nice. And I know a lot of people procrastinate. Unfortunately, so we just want to make sure that we matched the numbers that we did last year. Because I know there's a lot of new people out there and I want to make sure their voices are heard too. Love it. Devo 6-9-1-2 is our next question. Any guy team, are less people wealthy because they do not understand compounding and time? Or is it, do you think, they have high housing vehicles or lifestyle costs and never give those costs a second look? This is like, what do you think the question is? Can I give the hot take here that's going to make me sound like an old man? I'll be the old man on the front porch and then let Bobie the nice guy here because hopefully I get enough goodwill from talking about TLC earlier. Because the stat, because I had mentioned it in that wealth window show, but I had talked about where the source was. Well, now we know the sources from the Federal Reserve that the typical 65 to 74-year-old doesn't have more than $200,000 a day for retirement. And look, without a doubt for young people right now, housing stinks and we've done a lot of content on that. But housing didn't stink for those baby boomers who are between that 65 to 74 age, but yet there's no savings. So I think that, yes, it is harder for younger people to think about it with housing. But if you go look at the stats for the people who are the generations ahead of the current generation, they had cheap housing and they still don't have money for retirement. So I think there's definitely a discipline component that is disconnected that people just procrastinate and don't realize how valuable it is to start saving something, just doing something. I don't care if it's just getting your employer matched and then just maybe funding a Roth IRA while you're in your 20s, 30s and 40s will literally change your life. I think that we, we as a society, we struggle with deferred gratification across the board. It's why we're probably not as healthy as we ought to be. We don't make as wise decisions around that as we should. It's the same with our finances. I think it's really easy. Oh, well, I want this thing today. So I'm going to do it or I want to have this thing. And so we live in this consumption society with the idea for procrastination. Oh, well, I'll save next year when I get the pay raise then I'll save and they end up pushing it, pushing it, pushing it. And it is a reality that housing is expensive and vehicles are expensive and lifestyle, even in today's society, can be expensive, but we really do have a belief that anyone can build wealth. But we've even done episodes on how to build wealth if you only make X number of dollars. And we've kind of done it with different strata. It is possible, but if you have a lower income, if you have less margin, you have to exercise a whole lot more discipline and you have to be willing to do that for a longer period of time. I think it's a combination. I think that people don't understand that, you know, $95 for a 20 year old can turn into a million dollars invested monthly until 65. They don't understand it, but then they're also blinded by, "I want what I want right now today. I don't want to think about the future. I'd rather have it right now." It's why we have such a big debt problem. Not only are we really bad at deferring into the future, we're also really bad at robbing from our future selves. It's why we have this debt epidemic that's going on in America. We were reviewing a show that we're going to be recording after this show, the live stream, where it was showing the savings behaviors of Americans from the 1960s all the way through 2020 something. You know, I can't remember if it was last year or the year before, but we were saving over 10% as a country all the way until the early 80s. I think that that's. Well, this is from the 60s and 70s and even early 80s. Most people had pensions. The pension area. So it was 10% and then they had people had pensions on top of that. We lost something. And I blame them. I lay a lot of this on the banking system has gotten really good in encouraging consumption through credit cards and we try to create and educate you guys so you don't fall in this consumption trap that has been laid for you when there's so much opportunity because with index funds and access to where you can do everything on your mobile phone now, it's actually the easiest time in the world to actually start doing something. But so often people just get distracted and I think then they create their own trap of debt that they can even get out of. Not only is it the easiest time in the world to invest, it's also the easiest time to get distracted because now you pull up your investing app and all of a sudden on the side, there's sports betting or prediction markets or all that. There's a thousand different things vying for your attention that can very easily pull you away from doing the thing that's worked for the last hundred years, living a lesson you make, putting it to work, investing in low cost indexes and watching your dollars grow. Don't try to beat the market, be the market and you're going to be just fine. You're going to be just fine. Love it. Six nine one two, thank you for the question, appreciate you being here during the live stream. Food cast bullish is up next. Okay. I don't know what that means, but that's the usual thing. I like it. I get created with the food. Hey money guy team, would you prioritize paying down a 7.5% HELOC or funding a Roth IRA? I have no other debt. Food cast, I bet they're going to ask you your age. So if you're out there and want to share that in the chat, we would love to know because that might help. One of the age, now if you have a 7.5% HELOC, what was that? Why was that even taken? When you say no other debt, does that mean you don't have a mortgage either? I bet there's a mortgage outstanding somewhere, right? There's probably a primary mortgage outstanding on that and then you have this home equity line of credit. A few things I'd want to know. I want to know your age and I'd love to know what your current balance sheet looks like. How much do you currently have saved and invested? Do you have a big pot of assets that are working for you that are growing and compounding right now where it makes sense to really attack the 7.5% HELOC to knock it down or have you procrastinated? Have you not been building and you really don't have any investment assets built up? I'd like to know the answer to those questions and I'd also like to know the size of the HELOC. Is this a $150,000 home equity line at 7.5% or is it a $10,000 home equity line? Well, that gets to the point of the context of what created the home equity line because if you went and bought a car with a home equity line, that's a disaster. At least then I can give you the context of let's correct your path of what the mistake that was made and then how we get back on track, treat it like $23.8% so that way maybe we can still do our Roth IRA and correct the mistake and then if it's something we actually did make an improvement on the house, I mean, I will tell you, I don't mind people using home equity lines, but it needs to be just a momentary bridge to get you through this moment and top and probably not any longer than three years, maybe you could maybe convince me four years so because I don't want this thing to occupy all of your free cash flow. If you can't do a home improvement and not pay off the home equity line within that three to four year period, you might just need to defer not doing the home improvement so that you're not sacrificing your future retirement. So that's why I hate retroactively, but we have to triage your financial life exactly where it is and that's why a Bose point of it depends with all the additional context so we can make sure that we're not just saying, "Hey, no, no problem. Just pay off that. Pay this seven and a half percent home equity line. Don't even worry about the Roth until you get it figured out. I need a little more context so we can give you the right pinpointed plan of action for your specific situation." I don't think we ever got that information. I was watching. I didn't see it come through. But that's all right. I think you talked around the possibilities there so we appreciate the question and we're going to move on for one more question before we get to our rapid fire segment. So RF in front of your question in the live chat if you want to be part of our rapid fire segment. But first, B892 has a question that says, "Hi, Money Guy team, I'm 25 with 105K an annual income on step four of the food. I want to change to a more fulfilling career that would likely drop my salary by 20K and have less benefits. How do I plan for this?" I mean, this is probably the time to do it. Yeah. If you're in step four, you're building up an emergency fund. What I would do is I'd probably build up that emergency fund even more than I think I need. Like if I'm building it up for six months, but I know I'm going to take this step back and pay and I'm probably going to have to do some lifestyle adjustments because of that. I may want to build up to maybe seven, eight, nine months of liquidity just so that way I don't have any shocks to the system. And then I got to work really, really hard. If I was used to living off of 105,000 and now all of the sudden I'm going to be living off of 85,000, my net take home is likely going to drop assuming I'm saving the same percentage. I want to make sure that I adjust my lifestyle accordingly to make sure I can do that. And by the way, there's nothing wrong with that. We see people all the time, Brian, who want to come and work here, that they're doing very well in their careers and to end up coming and restarting and repivoting. They might have to take a step back and that's totally okay because it's a better lifestyle choice, a better long term opportunity, a better metrics looking forward. But you have to decide for yourself, okay, what are the things that matter? What's this going to affect long term for my plan, and am I willing to accept those trade offs? Let me be like your favorite nerdy uncle that you like to approach with decisions like this. I would ask you, I was like, you're at the perfect stage to make a choice like this. But is this a short term solution, meaning that you have to take this step back to get you out of the unhappiness situation you're in? But this is only the first of multiple steps or is this truly, you're going to take a step back for a much bigger opportunity down the road because Bo is Bo just alluded to. We do have career changers that come in here. And I got one of my favorite things as an employer's because we've had some brilliant engineers, people from the medical profession, other musicians, producers who've come on and done this. And I like to think that for many of them, this has turned out to be the best career, not from just a quality of life, but also even economically for their families has turned out to be a great opportunity. That's the filter B I need you to do is because that you have to look, despite what society tells you, jumping around every two years is not ideal for creating the resume that lets an employer or your future self feel like you built community or the best version of yourself. Think long term begin with the end in mind of how you this transition is going to change. Whether twice caught once if this is the right decision, do it, but just make sure you're not thinking just in this moment in time for the next 12 or 24 months. Let's think what 60 months or even 10 years looks like if you make this step. Love it. Thank you so much for the question. B892, appreciate you being here. With that, we are going to move into our, it does not depend rapid fire segment where Bowen Bryan answer your questions in a combined 30 seconds without saying the words, it depends. And just in case there's something really important that they can't fit into that time, we will address them in a segment at the end. And I do have a little bit of a twist halfway through this one as a surprise. You'd have to see lyrics. No, I don't make me do that. No, I can't do that. I can't do that. I can't do that. We'll get 30 seconds on the clock. I'll go first and she went first last week. And we will kick it off with the first question or rapid fire. Are you ready? Is it ready? I'm going to be. You're supposed to say I was born ready. Born. Let's get some confidence. Go on. Go on. Ready. There we go. All right, first question. In retirement, do you have a set percentage of net worth that should be your primary residence assumed it's paid off? No, it's your primary residence as long as it's paid for in cash and I would take into account the living expenses and make sure that fits within your withdrawal track. I would also say no. We've had a lot of people who retire in the home that they might have bought 30 years ago, but it might have been on the coast or something like that. If you look at the value of their home, it might represent Isn't it a large portion of that worth? Only 'cause they've owned it for so long. We care more about as your liquid portfolio, it's gonna provide for your living expenses. You wanna make sure that's large enough, I wouldn't worry about the size of the primary. - All right, we've done the first question. Number two, what are some financial mutant hacks or tips for moving? - Financial mutant hacks or tips from, pay someone else to do it. I mean, that's not a financial mutant hack. That's not a financial mutant tip, but I do not like moving. - I mean, try to minimize it as much as possible and then, you know, protect your back. It's more longevity. - Both as wealth. - Health is wealth. - I mean, that one, can we say, that one needs to have a lot of depends. I'm just gonna say it, I'll come, I need to come back to that moving. - Financial hacks, tips from moving. I mean, like-- - I got some plots. - Yeah, there's like-- - You're all right, there's like-- - I haven't the buddies come. - But that really stumped you. - Well, you know, that's a good story. - So many different labels 'cause-- - Look, I've moved four or five times and I had to do it different ways and different stages of life. - Exactly right, yep. - Question three. - I need to know, whoever asked that one, I need to know where you went in life. Tell me where you're at in life and I'll give you an answer. - If you ask that question, put it in the chat. We'll watch for your answer. Where are you in life? They'll come back to it, give you some moving tips and thoughts. All right, question three. Does the rule of 55 apply to a solo 401k when you are a sole proprietor? - Are you ready for this? This is a doozy. - No, you know why the rule of 55 does not apply to a solo 401k 'cause in order to have a solo 401k, it has to be an active plan that's opened up. This is one of the things we've sort of investigated and trying to figure out over the past couple of years. Our position is that solo 401k does not qualify for rule of 55. Because you are not an active, 'cause you can't have a solo 401k if you're not an active participant in the 401k. - Did it say solo or was it separate? - It says solo 401k. - Yeah, okay, I'm both crushed. Sorry, I didn't mean to go long. - Dude, it's fun. I'm still overthinking about moving things. - All right, next question. Ramsey Solutions has a rule that, quote unquote, things with motors should not have a value over 50% of your yearly income. Do the money guys have a similar rule? - You know, I've heard Dave do that in interview. I think he did it on the Bobby Bones interview and I was really impressed at the time because I mean, it is one of those things, but I've never, I mean, that seems like common sense to have, 'cause all those things are depreciating. I mean, every one of those things is depreciating, so I wouldn't want 50% going towards depreciating assets. - Yeah, I think it's a good rule of thumb, but again, it seems to have a stage of life matters. If I'm a retired individual, the huge portfolio, but I don't have a huge income, but I don't want to buy the nice car, I'm not gonna fight up that. - That's time. Do you want to come back to that? - No, I'll, I mean, yeah, sure. - You don't have to. - Okay. - Oh, okay, we'll see. - It's a nice rule, but I'm trying, I'd have to go do the math to figure out. - We'll come back to it. - Fail. - Yeah. And then after this question, we're gonna have a little twist to stay tuned. Is it okay to pause investing, except for your 401k match, for just a year so that I can save for a home? - Yeah, it's absolutely. Your financial goals are your financial goals and you wanna use your money to achieve whatever your goals are. And if one of the goals is home ownership, in order to do that, you have to pause investing to get there, that's okay. You just need to recognize there's a big opportunity cost for doing that. - Yeah, I'm okay with as long as it covers step two, three, and four. Anything after those is, it's okay to defer, but don't skip out on the match. Don't skip out on paying 20% interest to banks, and then definitely have a cash reserves. - Well done. All right, for the last few questions, we are going to change it up and put 15 seconds on the clock. - No, we keep doing that. - Let's just see what happens, humor me. - You go first. - If it doesn't go well, we'll tackle them all in the ending segment. So with 15 seconds on the clock, the question is, is it worth it to withdraw Roth IRA contributions to pay off high interest debt? - No. I say no too, because those dollars, it's very costly and look at the opportunity to cost standpoint. If I would find every other mechanism in the world to pay that off without pulling out the Roth IRA. - Go work a second, John. - Wow, look at that. Under 15 seconds. - Had plenty of time. - Solid answer, too. Next question, how do you acknowledge your accomplishments? I finished my credit card debt earlier this year at 24, but feel underwhelmed, still that I have less than a month in my emergency fund. - That's okay, you're still in the beginning stages. It's small wins, small wins, small victories, lead to big wins, big victories. - And then join the money verse and go, enter your wins there, 'cause you'll be surrounded by people just like you. - Hype squad. - Moneyguy.com/moneyverse. - Look at that. Bam, bam, bam. 15 seconds. Next, does it ever make sense to target brokerage instead of maxing your 401K after getting your 401K match and maxing Roth IRA? - No, this is something we've covered. I think it's a marketing hype that there's groups out there saying this, but unless you're part of the fire movement and you're retiring like at 50/55, I would rather you get the tax favor to investing. - Yes, there are tons of them you need to do that. - We're coming back to that one. Agreed, disagreeing, want to play. - All right, last but not least, is the S&P 502 concentrated in tech. If so, how do you recommend diversifying? - No, I don't think it's too concentrated in tech. Right now it does have a tech bias, but I don't think it's too concentrated in tech. When you have a diversified portfolio branch out outside of just S&P. - It's been over concentrated in tech for probably the last 30 years. - Not too shabby, not too shabby friends. How do 15 seconds feel? - Not good. (laughing) It's like somebody asking you to help them move the couch. - No, but worse, can you help me move my piano? - That's what that felt like to me is 'cause it's even worse than moving a couch or a refrigerator. It's like asking somebody to move a piano. - 15 seconds was like moving a piano? - Yeah, it's painful. - Okay, no, no, no, did. Let us know, give us some feedback. Do you like adding some 15 second timers in there or do you like 30? With that, let's move on to our, it does not, or maybe it does depend segment where we're gonna go revisit some of these questions. The first one was the moving tips for moving. So 32, step one, just finish grad school and take the CPA exam. We'll be in step three as soon as I start work. Thanks to good times. Awesome, okay, that's the context. - So I was gonna give the experience share is that early in my life, I did it on the cheap. You haul, called my friends and family to help me move 'cause I didn't have a lot of stuff. Didn't inconvenience a lot of people. Next move, upgraded to where I did you haul, but I used professional services to help me move the heavy stuff. Meaning, I did all the self packing, but then I had 'cause you can now add on professional services to help you actually load and unload the truck. And then the third, I mean, when I started moving into the nice house, like when I moved to Tennessee, I overlapped, meaning I didn't sell my first house until I'd already moved into the second house. And that's a luxury, but man-o-man does it make moving easier? Because I didn't feel like I had to do it all at once and then have this pack up your whole life and then hope that the timing works or create an interim period where you're living in an apartment. But that's a privilege that you get to do after you've done all the other steps to where that's kind of like a step eight thing of the financial order of operation. - Yeah, I generally have a rule, don't move furniture after the age of 30s, but you're 32. So I'm gonna give you a little bit of pass. Now, here's what I do, I'd call a bunch of my buddies be like, "Hey, you got pickup trucks. I'm gonna rent a U-Haul and then bring pickup trucks. We're gonna load those up. I will buy pizza and beer." And that's how, that'll be what I pay you to do this and get it knocked out. Now, two tools you ought to buy that are game changers. The first, furniture pad sliders and straps. - Okay, I'm sorry, keep going. - Still wondering, what are you doing? What are you doing? - I'm sorry, I get excited. - Furniture pad sliders. You're the little disc that you put on the ground. You can set the furniture that you can actually move it around the house nice and smooth before you actually have to lift it in second. The over the shoulder straps. Over your shoulders down under the piece of furniture, you can lift and move anything like that. It makes it so much easier, it will save your back. Anybody, holy cow, this is not nearly as hard as I thought. - I still have the straps at my house 'cause every now and then I've had a few neighbors. I don't look, go ahead and I'll tell you, one of the reasons I don't like moving anything. I am in my 50s and I don't have back problems. And we have millionaire clients who have back problems because they did inappropriate stuff. So really measure twice cut once on moving heavy stuff past a certain age too, but Bo is exactly right. And that way straps are great for moving appliances. They're great for moving couches. They're great for moving dressers. Everything I've done this stuff for clients 'cause also going upstairs 'cause they're somewhat secured by you, you don't have to bloody up your hands. Holding the stuff, it is, and it's so cheap if you go buy straps on Amazon. - I have the cost of the straps. - There you go, look at you. - Every household, it's kind of like. - I find it so many tips. - You know, have your water filter and your go bag, you know, your fire starters and those things and then buy moving straps. And these are things that should be in every person's house. Flashlights, you know, go bag for things got really bad in the area like the power was out for a week and then moving straps. - I love it. - I have some shopping to do. (all laughing) - Make sure you put an affiliate link on the website. - I'm gonna give you a live stream. draw's. Do you know what those are where you can turn anything into drinking water essentially? Look at the content team all has their hands, both of you have a life straw in your house. You see my wife has these glass straws that she likes to drink out of the clay. Do you have life straws in your house? No, I have a, I think the water filter I have is a life straw brand. It just happens to be. That doesn't let you go turn pond water into drinking water. No, I don't think so. Have you tested, have you went and drank, drank out of some like, drank water? No, but I'm watching a few YouTube videos. I'm an expert. All right. All right. Make sure to put a link to the life straws as well, guys. Okay, we have a couple more to see back. I'm just kidding. I'm kidding. That one's a joke. It didn't mean that one. I missed it. You know what's funny is I actually, my mother-in-law, I don't know why, but she did, but they're not MREs, but they're basically like the dried, I got a ton of those in my pantry, like the dried food packets and stuff. I got a bunch of those. No, no drinking straws. Why do you have, she likes to gave them to you for Christmas. There you go, son. Happy Merry Christmas and a bunch of MREs. Save your life. Maybe. That's what she's thinking. I just saved my kids life. Maybe. Thanks a lot. All right. The other one that you kind of waffled on or just felt you had more to say was about Ramsey's things with motors. Yeah. Not having a value over 50% of your yearly income. You had some more, it seems like you had some more to tell that. No, I had to think about it. We're rapid-fire. That means if you make a hundred grand, you can't have a car more than 50, that worth more than $50,000. What do you do about retirees? There you go. That was my whole point. That was where you were growing. If someone lives on a much lower income, or let's say. No, because it's disconnected from the reality of your net worth would drive what type. I think I'd rather use, no, I think, I think look, no, I don't, I don't, I don't know love that for the, it doesn't make it through the whole continuum. No, look, in your early journeys, we're on the same page as Ramsey is that we want you to limit depreciating assets as much as possible. But I think there is a disconnect as you get older and have more success because I'm trying to free you to use and live your best life in retirement. Yeah. I think about, even like, yeah, I got a bunch of bodies who like own boats and I'm so happy they own boats, so I don't know what about. But that, those rules, it kind of start to fall apart probably. If you think about, like, if you got a boat, I'm not saying you don't have all those toys. There's certainly people that can't afford those and do that. But I would worry, would that hold in those situations? I think it's good when you're young. I mean, this is back to the rule. I think Dave is so good at getting people out of debt that it definitely helps out the 20, 30 something. But I think if you're somebody who's gone beyond the basics, that's when those rules get very, very nuanced. By the way, we also realize that, you know, we did the whole Busta and TLC reference, you know, no scrubs in your best friends, Rod, we kind of realize that's the financial mutant in this. They're the war. They don't know that in TLC song, that would be the Busta. But in part of my life, that's actually the financial mutant because you want your best friend to have the fancy car that you can hang out of. That's right. That's right. So we have just let it be known that we think the, I'm trying to remember how the lyrics can somebody remind me the lyrics, your best friends, Rod hanging out. You just keep from trying to some lyrics. That guy's the financial mutant. Keep talking. I'll get you some lyrics. You're very slow. I was kind of hoping that we'd already be there. A scrub. Nope, that's the very beginning. You know, best friends, Rod. No, I don't want no scrubs. No scrub. A scrub is a guy that can't get no love for me hanging out the passenger side of his best friends, Rod trying to holla at me. That's the financial mutant. I don't want that. That is the financial mutant. A scrub is a guy. She should want the scrub. She should want the guy hanging out the passenger side. Just ask him if he funded his Roth IRA. Now we're on to something scrub. That's what you're trying to say. Not a buster there. Just don't have a car payment. Oh my goodness. Was there, was there any more? There was one more last but not least. Does it ever make sense to target brokerage instead of maxing a 401k? You said you just agree with me. I know personal finances, there are there are seasons and times when you're moving through the financial order of operations. As you get closer to when you're actually going to use those dollars, like when you get into step seven, you're thinking about, all right, I'm about to retire and I want to make sure I've got my three buckets filled. Maybe it doesn't make sense for me to continue saving in my employer's sponsor time and account my 401k because I need to have those bridge assets for some reason or another. Maybe I'm retiring before 55 or I want some liquidity or flexibility for something. It may make sense at that time to shift and not max out the 401k start building an after tax brokerage account. We see people do that, but that's later on in your financial journey, not at the beginning. But if you're in the first saving of 25% of your gross income, you know, because there are people, if you make under 100 grand and you're saving, you know, you know, somewhere between 80 to 100, you might reach 25% without maxing out your Roth. I mean, you're 401k and then could still even get it to doing it after tax in step seven. But that's what, you're going to want to do the tax favorite stuff. For sure. I mean, on the first 25%, that's why I think that is bad advice when you're helping people on the foundations. Of course, when you're close to retirement, it gets much more nuance because it's in, gets very personalized. But I do know there's firms out there that are marketing this because they want to have a contrarian point that they can say this is the way to draw more clicks and eyeballs. And I'm here to tell you, just be careful when people try to create sensation that's disconnected from what is probably the advice that you need to be doing at the beginning of your journey. Yep. All right. We said this. I know. It's just when there was more news. That's why I do that 15 seconds or 30 seconds. You got a personal finance is very personal now. I will say in the beginning steps, we're trying to figure out what to do with your next dollar. I think there's a lot of things just like in math. There's an order of operations. There's definitely a financial order of operations. And don't let somebody's marketing or contrar point get you in trouble when they're given advice. It might be great for a 55 year old or 50 year old. All right. Let's, have you read, have you read the lyrics to those girls before? What else is in there? I know. I was if you don't have a car and you're walking. Oh, yes, son. I'm talking to you. If you live at home with your mama. Oh, yes, son. I'm talking to you. If I'm sitting here thinking like this guy's just saving money. See, I told you this was a TLC episode. I will never be able to listen to this song the same way. I never answered. Wow. I have no idea. She might not have had it figured out with burning houses down and so forth, but maybe one of the others got it. All right. We're going to close it out with a question from our friend. Grill this, smoke that. Hey, Benson here. He says, I want my family to start chasing waterfalls through travel. Once we are at step seven and eight, what percentage of income is acceptable to dedicate to experiences for the family? So they can chase the waterfalls. You should go spend a ton of money on travel. Yeah. I just know how good Ben's doing. Anybody, if you're not watching grill this, smoke that like I see a show shows up all over my TikTok. I know it's on Instagram and everything else. Ben makes me so I want to go buy one of these grills just so I can cook breakfast. Like he cooks breakfast or he made something the other day pancakes where he used like food coloring and made a Georgia G and I was like, how does he do this stuff? But he is killing it. And I think you should go make all the memories you want to make. Okay. Now give the real advice. Yes. The answer is is once you're in step seven eight, bring all the thing up for me. Once you're in step seven rate of financial cooperation, that lets me know you're already saving 25% of your gross income for the future. Well, the reason why we say to save 25% is so that after that point, you can spend lavishly on whatever you want. So how much is acceptable to spend on travel after that point as much as you want. If you want to spend all of your extra discretionary cash flow on travel, that's totally fine. That's what the 25% is supposed to do for it. It's supposed to free you so that you can spend guilt free. It doesn't matter if I spend on the hobby or I spend on the travel or I spend on the increasing lifestyle. Whatever that is, 25% is that threshold that you cross over that now frees you to use your money. However you want for today. So I think if you're already in step seven and eight, absolutely. And we would argue if you're looking for some advice, spending money on travel and making memories and creating experiences way more valuable, way more fun than spending it on things and cars and homes and that kind of stuff. So I think if you aren't that place where you can start doing that, by all means start doing it and don't feel guilty about it because I think that's awesome. That's exactly where you should be. Everybody's going to go check out Ben stuff and then you're like, wow, my feed is now just covered up in his stuff because once you watch one, because you're going to watch the whole video, you'll get to keep getting this stuff over and over again. And I think that's part of why he's so successful with it. That's not a bad thing. Well, we love that. Thank you, Ben, for the question. Thank you, everybody who submitted a question today. It's been really fun. Remember, you can continue you to shape what we talk about on the show, but you only have a limited time. Tomorrow, our financial mutant survey closes, so go to moneyguide.com/survey to get in on that before it's too late because we want your voice to be heard. It matters. We want to speak to your pain points. And the survey will only take a few minutes of your time. It's completely free. It's going to shape the show for the next coming year. So please do that. We are really excited about it. We love doing these episodes every year. Really a favorite annual tradition if I say so myself. No, we love this. And you guys could, there's so many things going on in the world right now that you could be spending your time doing, but we do not take for granted that you give us this time. I mean, and some of you guys, I mean, that's why go check out the moneyverse too, because I mean, the quality of this audience and the people, I mean, it blows my mind. You know, you'll be shocked at some of the comments. And I know the context of who these people are. And our in our midst. And I'm just like, this is the right people to be hanging out with. If you want to have the right influences on your life, if you want to kind of have, because I know it's hard. Money is a taboo subject. It's hard to talk about, but you can create a community where you can carry forward and have these conversations, make some friendships. It's fun that we get to do this with you. We don't take for granted. I'm your host, Brian. Join Bob Mr. Bow. Rebe the rest of the content team in the wings. We're out of here. Money got show out. The money guy show is hosted by Brian Preston and Bo Hanson. Brian and Bo are partners with a bound wealth management. A bound 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. A bound wealth management does not render or offer to render personalized investment or tax advice through the money guy show. 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