1 00:00:00,120 --> 00:00:02,960 Speaker 1: Welcome to How the Money. I'm Joel and I and Matt. 2 00:00:03,160 --> 00:00:06,760 Speaker 1: Today we are explaining why these financial rules were made 3 00:00:06,760 --> 00:00:27,479 Speaker 1: to be broken. So, Joel, as you said that, it 4 00:00:27,520 --> 00:00:29,319 Speaker 1: made me realize that this is an episode that I 5 00:00:29,360 --> 00:00:31,680 Speaker 1: don't want listeners to listen to if they have never 6 00:00:31,720 --> 00:00:34,680 Speaker 1: listened to our show before, because I'm planning this episode 7 00:00:34,720 --> 00:00:37,280 Speaker 1: under the start here section exactly. Yeah, this is like 8 00:00:37,280 --> 00:00:40,400 Speaker 1: a two thousand level class at your local university. We 9 00:00:40,400 --> 00:00:42,760 Speaker 1: want to make sure that folks have truly like a 10 00:00:42,800 --> 00:00:45,559 Speaker 1: foundation of a foundation of knowledge when it comes to 11 00:00:45,600 --> 00:00:48,320 Speaker 1: personal finances. Because in this episode, we're going to talk 12 00:00:48,360 --> 00:00:51,040 Speaker 1: about some concepts, uh, and we're gonna we're essentially we're 13 00:00:51,040 --> 00:00:53,080 Speaker 1: gonna flip them on their head a little bit because 14 00:00:53,080 --> 00:00:55,360 Speaker 1: we're making the argument that you can't take all the 15 00:00:55,400 --> 00:00:57,960 Speaker 1: different financial rules that are out there at face value. 16 00:00:58,160 --> 00:01:00,440 Speaker 1: We're gonna ask you to dig a little bit deeper 17 00:01:00,480 --> 00:01:03,280 Speaker 1: and we're gonna explain why it is that we feel 18 00:01:03,280 --> 00:01:05,640 Speaker 1: that there are certain financial rules that we can break. 19 00:01:05,880 --> 00:01:07,840 Speaker 1: We're gonna talk about where you can place back and 20 00:01:07,880 --> 00:01:09,479 Speaker 1: where we a little bit we can fight the man, 21 00:01:09,600 --> 00:01:11,360 Speaker 1: you know, a little bit when it comes to the 22 00:01:11,360 --> 00:01:14,039 Speaker 1: financial rules that we have all heard like these are 23 00:01:14,080 --> 00:01:16,360 Speaker 1: These are common rules that you have probably heard a 24 00:01:16,400 --> 00:01:19,480 Speaker 1: time or two or dozens of times, and and some 25 00:01:19,560 --> 00:01:22,280 Speaker 1: of them, Um, there's there's certainly a kernel of truth 26 00:01:22,319 --> 00:01:25,039 Speaker 1: that there's some good advice in there, but there are 27 00:01:25,080 --> 00:01:26,919 Speaker 1: a lot of ways that you can break those rules 28 00:01:27,000 --> 00:01:30,319 Speaker 1: and actually benefit your personal financests. Right exactly before we 29 00:01:30,319 --> 00:01:31,840 Speaker 1: get to that, dude, I wanted to share a quick 30 00:01:31,880 --> 00:01:34,440 Speaker 1: little story with you. Kate and I were on a 31 00:01:34,480 --> 00:01:37,080 Speaker 1: belated anniversary trip. We were driving back from North Carolina. 32 00:01:37,319 --> 00:01:40,679 Speaker 1: We went hiking up in the North Carolina Mountains. You 33 00:01:40,680 --> 00:01:42,479 Speaker 1: spotted a bear while you were there too. I did 34 00:01:42,560 --> 00:01:45,959 Speaker 1: we should post two bears, a mama and a cub, 35 00:01:46,319 --> 00:01:49,120 Speaker 1: and I'm the cub was cute, but we quickly realized 36 00:01:49,160 --> 00:01:52,640 Speaker 1: that there was a mama bear that was closely following. 37 00:01:52,760 --> 00:01:55,560 Speaker 1: I was glad you didn't go like Leonardo in the 38 00:01:55,640 --> 00:01:59,360 Speaker 1: revenues style thought my pocket knife. Uh No, Kate would 39 00:01:59,400 --> 00:02:00,880 Speaker 1: not have let me do that. That would have been 40 00:02:01,400 --> 00:02:04,320 Speaker 1: a bad ending to our anniversary of one of our 41 00:02:04,320 --> 00:02:07,480 Speaker 1: anniversary hikes, but I was gonna share. Driving back from 42 00:02:07,480 --> 00:02:09,960 Speaker 1: North Carolina, it was obvious there's a car up ahead 43 00:02:09,960 --> 00:02:11,960 Speaker 1: of us that we're catching up to it was all 44 00:02:12,000 --> 00:02:14,880 Speaker 1: decked out and the we just got married kind of look. 45 00:02:14,919 --> 00:02:16,839 Speaker 1: You know, when I'm talking about the cans hitting the roads, 46 00:02:17,040 --> 00:02:22,200 Speaker 1: No cans, I think that's dangerous actually, but the cans 47 00:02:22,360 --> 00:02:26,200 Speaker 1: hitting windshield behind them? No. They had the window pant 48 00:02:26,400 --> 00:02:28,359 Speaker 1: and it said, you know, just married, you know Mr 49 00:02:28,360 --> 00:02:31,560 Speaker 1: and Mrs whatever their names were. I forget. That's always 50 00:02:31,600 --> 00:02:33,440 Speaker 1: a super fun thing to do, right, you know, you're 51 00:02:33,560 --> 00:02:35,959 Speaker 1: I guess they're driving to their honeymoon. They looked all happy, 52 00:02:36,880 --> 00:02:39,560 Speaker 1: ready to get on with their their lives together. But 53 00:02:39,680 --> 00:02:42,320 Speaker 1: something else that we noticed that was also written on 54 00:02:42,360 --> 00:02:47,519 Speaker 1: the window was their Venmo handle, their their name. And 55 00:02:47,639 --> 00:02:50,040 Speaker 1: I couldn't believe when I thought, I was like, wait what? 56 00:02:50,440 --> 00:02:53,600 Speaker 1: And I realized that I guess they're hoping that folks 57 00:02:53,919 --> 00:02:56,880 Speaker 1: driving down the interstate might see that, might want to 58 00:02:56,960 --> 00:03:00,280 Speaker 1: congratulate them, might want to pass them some money, uh, 59 00:03:00,320 --> 00:03:02,160 Speaker 1: in order to to help them celebrate a little bit. 60 00:03:02,280 --> 00:03:05,359 Speaker 1: But before I share my thoughts, what do you think 61 00:03:05,480 --> 00:03:08,560 Speaker 1: is that frugal? Is that cheap? Is that a tasteful 62 00:03:08,600 --> 00:03:10,800 Speaker 1: move or do you feel like that that lacks class. 63 00:03:10,919 --> 00:03:13,120 Speaker 1: I'm gonna say it's clever. I don't know if it's 64 00:03:13,120 --> 00:03:16,520 Speaker 1: frugal or cheap, but it's clever because I think there 65 00:03:16,560 --> 00:03:18,399 Speaker 1: are a lot of people who are going to see 66 00:03:18,440 --> 00:03:19,960 Speaker 1: that driving down the side of the road and they 67 00:03:19,960 --> 00:03:22,000 Speaker 1: are going to remember their wedding day and they're gonna 68 00:03:22,000 --> 00:03:24,120 Speaker 1: remember all the excitement and they're gonna be compelled to 69 00:03:24,200 --> 00:03:28,280 Speaker 1: drop bucks. Maybe maybe who I don't know. If some 70 00:03:28,320 --> 00:03:31,040 Speaker 1: people would just be like, congrats, you guys made my day. 71 00:03:31,080 --> 00:03:33,400 Speaker 1: That was pretty funny. I was because it's it's almost 72 00:03:33,400 --> 00:03:36,920 Speaker 1: to me like when I'm walking through downtown Atlanta and 73 00:03:37,000 --> 00:03:40,240 Speaker 1: I see, uh, someone like a homeless person who has 74 00:03:40,240 --> 00:03:42,320 Speaker 1: a clever sign, like with a joke on it or 75 00:03:42,360 --> 00:03:44,800 Speaker 1: something like that, it makes me more compelled to give. 76 00:03:44,840 --> 00:03:46,480 Speaker 1: And I don't know what that is. But when they've 77 00:03:46,560 --> 00:03:49,360 Speaker 1: kind of like just made me smile, you appreciate that creativity. Yeah, 78 00:03:49,400 --> 00:03:51,880 Speaker 1: I'm like, I like the creativity. And I'm like, all right, yeah, 79 00:03:51,920 --> 00:03:54,800 Speaker 1: here's here's five bucks. You know. Um. So I don't know, 80 00:03:55,040 --> 00:03:57,320 Speaker 1: it's not like everyone's doing it. It's kind of a 81 00:03:57,360 --> 00:03:59,880 Speaker 1: one off thing. I'm like, oh yeah, that is Collogum 82 00:03:59,920 --> 00:04:02,200 Speaker 1: I ten bucks. Okay, So I kind of revealed I 83 00:04:02,240 --> 00:04:03,840 Speaker 1: guess how I feel about it, because I truly when 84 00:04:03,840 --> 00:04:05,640 Speaker 1: when I first saw I couldn't believe it. I was honestly, 85 00:04:05,680 --> 00:04:07,680 Speaker 1: I was a little bit offended because I I have 86 00:04:07,800 --> 00:04:11,360 Speaker 1: such uh like pull yourself up by your bootstraps, like 87 00:04:11,400 --> 00:04:14,760 Speaker 1: self reliance kind of mentality that literally when I saw it, 88 00:04:14,760 --> 00:04:16,560 Speaker 1: I just can't. I mean, I thought, you gotta be 89 00:04:16,640 --> 00:04:19,000 Speaker 1: kidding me like that they're actually expecting people to give 90 00:04:19,040 --> 00:04:21,920 Speaker 1: the money just because they got married? How dare they? 91 00:04:21,960 --> 00:04:24,159 Speaker 1: That was like the old man side of me. But 92 00:04:24,200 --> 00:04:26,760 Speaker 1: then I think it off my law on. Yeah, but 93 00:04:26,839 --> 00:04:28,960 Speaker 1: then I thought, well why not? You know, like I 94 00:04:29,000 --> 00:04:32,480 Speaker 1: think it would be maybe lacking taste if they expected 95 00:04:32,520 --> 00:04:34,840 Speaker 1: you to give them money, but like there's no like 96 00:04:35,920 --> 00:04:37,839 Speaker 1: or else. Well yeah no, and they weren't doing that. 97 00:04:37,880 --> 00:04:39,160 Speaker 1: It was just kind of written on there. It's like 98 00:04:39,160 --> 00:04:41,280 Speaker 1: almost like an afterthought, and it was much smaller than 99 00:04:41,360 --> 00:04:43,039 Speaker 1: than what else was written up there. And what's the 100 00:04:43,040 --> 00:04:45,440 Speaker 1: worst that could happen? Right? I mean, somebody driving down 101 00:04:45,440 --> 00:04:47,440 Speaker 1: the road like me might see them and like judge 102 00:04:47,480 --> 00:04:50,279 Speaker 1: them and never see them again. Who cares? But it 103 00:04:50,320 --> 00:04:52,159 Speaker 1: never hurts to ask. It's like what we're talking about 104 00:04:52,200 --> 00:04:54,200 Speaker 1: when it comes to asking for a discount, And like 105 00:04:54,240 --> 00:04:56,520 Speaker 1: the downside, what's the downside. We're all so scared to 106 00:04:56,760 --> 00:04:59,600 Speaker 1: make that ask. But really the person can only say no, 107 00:04:59,720 --> 00:05:00,920 Speaker 1: they're not kind of like punch you in the face 108 00:05:01,000 --> 00:05:03,160 Speaker 1: usually exactly. And so because of that, I was kind 109 00:05:03,160 --> 00:05:04,719 Speaker 1: of like converted and right there on the spot, and 110 00:05:04,720 --> 00:05:07,680 Speaker 1: so I pushed him five bits. Ye see, give me 111 00:05:07,680 --> 00:05:11,880 Speaker 1: a dap, dude, Okay, I like that, Like I probably 112 00:05:11,920 --> 00:05:13,560 Speaker 1: would have done the same if I've seen it, because 113 00:05:13,600 --> 00:05:15,680 Speaker 1: it took me a second, because my natural inclination was 114 00:05:15,720 --> 00:05:17,279 Speaker 1: just like, you gotta be kidding me. You went through 115 00:05:17,320 --> 00:05:19,520 Speaker 1: all the realm of y. Yeah, that was like the 116 00:05:19,600 --> 00:05:23,159 Speaker 1: journey of me and uh seeing you know, some newly 117 00:05:23,200 --> 00:05:25,040 Speaker 1: wids on the interstate. But but yeah, I thought that 118 00:05:25,040 --> 00:05:26,719 Speaker 1: was an interesting clever way. So if there are any 119 00:05:26,720 --> 00:05:29,040 Speaker 1: new newly wids out there, that could be a way 120 00:05:29,080 --> 00:05:31,039 Speaker 1: that you maybe pay for a nice dinner around on 121 00:05:31,080 --> 00:05:33,000 Speaker 1: your honeymoon. Yeah. Make it fun, though, Make it fun, 122 00:05:33,200 --> 00:05:36,760 Speaker 1: and people will I think probably be excited to drop 123 00:05:36,800 --> 00:05:38,840 Speaker 1: you five bucks, like Matt finally got to the point 124 00:05:38,880 --> 00:05:41,400 Speaker 1: of doing. Alright, let's mention the beer that we're having 125 00:05:41,400 --> 00:05:44,600 Speaker 1: on this episode. This one is called Indefinite Staycation. It's 126 00:05:44,640 --> 00:05:48,000 Speaker 1: by dog Fish Hed Brewing. Matt my buddy Ryan brought 127 00:05:48,040 --> 00:05:51,320 Speaker 1: this beer back from Delaware. He actually visited the brewery. 128 00:05:51,320 --> 00:05:53,120 Speaker 1: He goes up there once a year and he's always 129 00:05:53,200 --> 00:05:55,280 Speaker 1: like nice enough to bring me bring us a bottle back. 130 00:05:55,360 --> 00:05:57,839 Speaker 1: So big thanks to Ryan for um jad dropping this 131 00:05:57,880 --> 00:06:00,320 Speaker 1: one off. We actually share to be together. He gave 132 00:06:00,360 --> 00:06:02,480 Speaker 1: it to me, um and so yeah, looking forward to 133 00:06:02,520 --> 00:06:05,839 Speaker 1: drinking this is like a really nice looking sour beer. 134 00:06:05,920 --> 00:06:10,000 Speaker 1: So yeah, it came corked and caged. Always a fancy 135 00:06:10,040 --> 00:06:12,240 Speaker 1: kind Yeah, one of those fancier beers. Looking forward to 136 00:06:12,320 --> 00:06:14,360 Speaker 1: this and uh yeah, thank you Ryan for donating this 137 00:06:14,360 --> 00:06:17,800 Speaker 1: one to Joel therefore to me. We'll give our thoughts 138 00:06:17,839 --> 00:06:19,200 Speaker 1: on it at the end of the episode. But let's 139 00:06:19,200 --> 00:06:21,960 Speaker 1: get on to the subject at hand, financial rules that 140 00:06:21,960 --> 00:06:24,640 Speaker 1: were made to be broken. And Matt um, you know, 141 00:06:24,680 --> 00:06:27,000 Speaker 1: speaking of going on a drive, seeing people you know 142 00:06:27,040 --> 00:06:29,880 Speaker 1: on the interstate with they're just married signs up. I'm 143 00:06:29,880 --> 00:06:32,520 Speaker 1: wondering if any how the money listeners out there are 144 00:06:32,800 --> 00:06:36,560 Speaker 1: the type that always obeyed the speed limits. I don't know, um, 145 00:06:36,600 --> 00:06:39,800 Speaker 1: that I've necessarily met anybody in my life who can 146 00:06:39,839 --> 00:06:42,440 Speaker 1: claim to never have ever gone over the speed limit. Um, 147 00:06:42,480 --> 00:06:45,080 Speaker 1: but maybe some of those people exist and Uh, yeah, 148 00:06:45,120 --> 00:06:49,440 Speaker 1: I guess, like, do you consistently try to drive under 149 00:06:49,600 --> 00:06:51,720 Speaker 1: the speed limit of the sign that you're seeing? If so, 150 00:06:51,839 --> 00:06:53,680 Speaker 1: I think you are an anomaly like that is not 151 00:06:53,880 --> 00:06:57,640 Speaker 1: your robot. That's the case exactly. So I'm of the 152 00:06:57,720 --> 00:07:00,640 Speaker 1: belief and maybe some of our listeners will disagree, but 153 00:07:00,960 --> 00:07:03,760 Speaker 1: speed limits were kind of made to be broken, and um, 154 00:07:03,800 --> 00:07:05,320 Speaker 1: I'm just just trying to be honest here, and I'm 155 00:07:05,320 --> 00:07:07,520 Speaker 1: not trying to insinuate that any of us should be 156 00:07:07,600 --> 00:07:10,560 Speaker 1: reaching like formula level one s. Yeah that my oh 157 00:07:10,640 --> 00:07:13,200 Speaker 1: six minivan, I'm gonna go like one tent only interstate 158 00:07:13,280 --> 00:07:15,040 Speaker 1: or anything like that. Do you think Homer can reach 159 00:07:15,120 --> 00:07:17,760 Speaker 1: those speeds? I think so. I think think so. Yeah, 160 00:07:17,760 --> 00:07:20,080 Speaker 1: you still got some fight left left in him. But yeah, 161 00:07:20,320 --> 00:07:22,440 Speaker 1: even like in a fifty five mile per hour zone, 162 00:07:22,480 --> 00:07:25,520 Speaker 1: I often find myself going sixty five. Um, And I 163 00:07:25,560 --> 00:07:28,119 Speaker 1: don't think I've met a person yet who never breaks 164 00:07:28,120 --> 00:07:30,360 Speaker 1: that rule. And it's not that rules aren't helpful, right, 165 00:07:30,400 --> 00:07:32,840 Speaker 1: that the speed limit isn't helpful. We like rules, and 166 00:07:32,840 --> 00:07:35,120 Speaker 1: speed limits I think are overall a good thing. And 167 00:07:35,120 --> 00:07:36,920 Speaker 1: these financial rules that we're gonna talk about, well, they 168 00:07:37,200 --> 00:07:39,480 Speaker 1: can aid us on our financial journey, and there are 169 00:07:39,520 --> 00:07:41,760 Speaker 1: sometimes when we need to rev the engine and blow 170 00:07:41,800 --> 00:07:44,520 Speaker 1: past not just the you know sign that says fifty 171 00:07:44,520 --> 00:07:47,040 Speaker 1: five an hour, but also we have to blow past 172 00:07:47,080 --> 00:07:48,880 Speaker 1: some of the financial rules that we've heard our entire 173 00:07:48,960 --> 00:07:51,840 Speaker 1: lives that are maybe cramping our style, um and not 174 00:07:51,880 --> 00:07:54,520 Speaker 1: allowing us to make as much progress as we'd otherwise 175 00:07:54,560 --> 00:07:56,920 Speaker 1: like to make. Totally. Yeah, when we believe, you know, 176 00:07:56,960 --> 00:07:58,520 Speaker 1: that the rules are just black and white, it can 177 00:07:58,560 --> 00:08:00,640 Speaker 1: limit what we're able to get done. Uh, and not 178 00:08:00,720 --> 00:08:02,920 Speaker 1: only in our day to day lives, but also with 179 00:08:02,960 --> 00:08:05,160 Speaker 1: our money. So kind of going back to your example, 180 00:08:05,160 --> 00:08:07,160 Speaker 1: if you're driving sixty five instead of fifty five, that 181 00:08:07,240 --> 00:08:09,040 Speaker 1: just means that you'll be able to arrive at the 182 00:08:09,080 --> 00:08:11,480 Speaker 1: mountains or maybe the beach a little bit sooner. And 183 00:08:11,520 --> 00:08:13,360 Speaker 1: we'd also argue that you can break this rule while 184 00:08:13,360 --> 00:08:16,800 Speaker 1: still being responsible, still driving safely. Uh. And so similarly, 185 00:08:16,840 --> 00:08:20,200 Speaker 1: there's a lot of financial advice out there. Some would 186 00:08:20,240 --> 00:08:22,800 Speaker 1: even call them rules that are you know, etched into stone, 187 00:08:22,840 --> 00:08:25,320 Speaker 1: as if they can never be broken. Where we believe 188 00:08:25,560 --> 00:08:28,240 Speaker 1: a certain amount of liberty can be taken. So we're 189 00:08:28,240 --> 00:08:30,640 Speaker 1: gonna cover some of those rules as well as why 190 00:08:30,800 --> 00:08:34,200 Speaker 1: it's okay to be a conscientious objector to some of 191 00:08:34,200 --> 00:08:36,719 Speaker 1: these financial rules. We're gonna give you the uh basically 192 00:08:36,880 --> 00:08:39,920 Speaker 1: the ammunition that's going to inform you why it's okay 193 00:08:39,920 --> 00:08:41,400 Speaker 1: to break some of these rules. Yeah. Yeah, we want 194 00:08:41,400 --> 00:08:42,920 Speaker 1: to give the why behind it, not just be like 195 00:08:42,960 --> 00:08:45,440 Speaker 1: this one's crap, toss it out, but giving kind of 196 00:08:45,520 --> 00:08:49,080 Speaker 1: the ideas for then how you proceed, creating maybe a 197 00:08:49,080 --> 00:08:51,480 Speaker 1: new framework for how you think about it, so that 198 00:08:51,520 --> 00:08:53,800 Speaker 1: you're not just living your life by rigid rules, but 199 00:08:53,840 --> 00:08:57,000 Speaker 1: that you have a fuller picture and understanding of kind 200 00:08:57,080 --> 00:08:59,560 Speaker 1: of how they should be implemented, implemented into your life. 201 00:08:59,559 --> 00:09:02,679 Speaker 1: For maybe you know where they shouldn't be. And so 202 00:09:02,840 --> 00:09:04,480 Speaker 1: let's let's start with Matt. Matt, with some of the rules. 203 00:09:04,520 --> 00:09:06,280 Speaker 1: Maybe they get a little judge. When it comes to 204 00:09:06,280 --> 00:09:09,160 Speaker 1: how we live our personal lives, a few lifestyle rules 205 00:09:09,320 --> 00:09:11,559 Speaker 1: are often cited, and then people begin to live their 206 00:09:11,600 --> 00:09:15,600 Speaker 1: lives by these rules, often subconsciously, they get filtered in 207 00:09:15,679 --> 00:09:17,960 Speaker 1: and then we just assume that we have to react 208 00:09:18,040 --> 00:09:20,120 Speaker 1: this way because that's what the rules say. And then 209 00:09:20,200 --> 00:09:23,480 Speaker 1: those rules can cause us to put off important, meaningful 210 00:09:23,520 --> 00:09:25,640 Speaker 1: things in our lives because we've been led to believe 211 00:09:25,880 --> 00:09:28,520 Speaker 1: that we're not in the financial position to make those 212 00:09:28,679 --> 00:09:31,640 Speaker 1: uh to make those decisions for ourselves. And I think, Matt, 213 00:09:31,640 --> 00:09:34,320 Speaker 1: one of those rules that I have heard stated countless 214 00:09:34,360 --> 00:09:37,000 Speaker 1: times is that you shouldn't get married or start a 215 00:09:37,000 --> 00:09:40,680 Speaker 1: family unless you are financially prepared to do so. And 216 00:09:40,720 --> 00:09:42,640 Speaker 1: that sounds like a smart rule, doesn't It's like, Yeah, 217 00:09:42,720 --> 00:09:45,680 Speaker 1: you don't want to have you know, negative net worth 218 00:09:45,800 --> 00:09:48,440 Speaker 1: to your name by hundreds of thousands of dollars and 219 00:09:48,480 --> 00:09:50,600 Speaker 1: then get married and attack yourself to someone else who 220 00:09:50,640 --> 00:09:55,040 Speaker 1: has the same Like, I get why this rule is 221 00:09:55,120 --> 00:09:58,120 Speaker 1: held out there as fact, But you don't have to 222 00:09:58,160 --> 00:10:01,000 Speaker 1: have necessarily a fully funded emergency in order to get 223 00:10:01,040 --> 00:10:03,160 Speaker 1: married to the love of your life, Like, there is 224 00:10:03,200 --> 00:10:06,240 Speaker 1: no actual rule stating this. There's no rule that you 225 00:10:06,320 --> 00:10:08,240 Speaker 1: have to own a home or you can put that 226 00:10:08,240 --> 00:10:11,320 Speaker 1: emergency fund together while you're driving down the interstate exactly 227 00:10:11,480 --> 00:10:14,000 Speaker 1: after you got other people funded for you. Yeah, and 228 00:10:14,120 --> 00:10:16,480 Speaker 1: there's also no rule that you must have started saving 229 00:10:16,520 --> 00:10:20,000 Speaker 1: for retirement before you tie the knots getting married. You 230 00:10:20,080 --> 00:10:22,679 Speaker 1: do so because you love somebody else. You love that 231 00:10:22,720 --> 00:10:24,080 Speaker 1: person that you want to spend the rest of your 232 00:10:24,080 --> 00:10:27,959 Speaker 1: life with. And so we wouldn't say to not consider 233 00:10:28,040 --> 00:10:31,400 Speaker 1: money at all when you're thinking about tying the knots uh. 234 00:10:31,640 --> 00:10:34,680 Speaker 1: We're fans of pre marital counseling and getting what's called 235 00:10:34,720 --> 00:10:37,400 Speaker 1: financially naked by like revealing kind of what's going on 236 00:10:37,440 --> 00:10:39,920 Speaker 1: with your personal finances and your credit score before you 237 00:10:39,920 --> 00:10:41,880 Speaker 1: actually do get married. You need to be honest and 238 00:10:41,960 --> 00:10:44,240 Speaker 1: you need to share, you know, what your income is, 239 00:10:44,360 --> 00:10:46,000 Speaker 1: if you have any debts. These are all things that 240 00:10:46,040 --> 00:10:48,120 Speaker 1: don't need to be a surprise. You know, you don't 241 00:10:48,120 --> 00:10:49,720 Speaker 1: need to save those until after you get married. Do 242 00:10:49,840 --> 00:10:51,640 Speaker 1: talk about these things ahead of time, but things just 243 00:10:51,679 --> 00:10:54,080 Speaker 1: don't have to be perfect exactly. Yeah. They don't think 244 00:10:54,120 --> 00:10:56,199 Speaker 1: that you have to continue to push that wedding date 245 00:10:56,240 --> 00:10:58,920 Speaker 1: down the road until you've reached like the most stringent 246 00:10:59,000 --> 00:11:02,360 Speaker 1: financial goals possible. And I think it's important to note 247 00:11:02,360 --> 00:11:05,520 Speaker 1: that nobody actually feels financially ready for these things, like 248 00:11:05,760 --> 00:11:07,960 Speaker 1: you don't. You don't get to this point where you're like, ah, 249 00:11:08,000 --> 00:11:10,200 Speaker 1: now I have enough money and we're going to live 250 00:11:10,200 --> 00:11:13,000 Speaker 1: in what it bliss because we have we we've reached 251 00:11:13,000 --> 00:11:15,920 Speaker 1: the financial status that we were looking to achieve. This 252 00:11:15,920 --> 00:11:17,520 Speaker 1: this is one of those things I feel like it's 253 00:11:17,559 --> 00:11:20,480 Speaker 1: important to push back on um and not to be 254 00:11:20,559 --> 00:11:23,600 Speaker 1: stupid when it comes to getting married and spending tons 255 00:11:23,640 --> 00:11:25,000 Speaker 1: of money on a wedding when you are in massive 256 00:11:25,000 --> 00:11:26,640 Speaker 1: amounts of debt, you want to be thoughtful, but it's 257 00:11:26,640 --> 00:11:29,440 Speaker 1: also important not to continue to put it off because 258 00:11:29,760 --> 00:11:31,880 Speaker 1: you don't feel like you're quite in the financial position 259 00:11:31,920 --> 00:11:33,880 Speaker 1: you want to be. There's always gonna be another problem, 260 00:11:33,960 --> 00:11:36,320 Speaker 1: right because if you have say you say you've a 261 00:11:36,360 --> 00:11:38,800 Speaker 1: massed a pretty decent net worth and you're looking to 262 00:11:38,840 --> 00:11:41,280 Speaker 1: get married, well, then all sorts of other questions start 263 00:11:41,320 --> 00:11:43,440 Speaker 1: coming up that you have to grapple with. As opposed 264 00:11:43,480 --> 00:11:46,240 Speaker 1: to before when you're both broke right out of college. 265 00:11:46,280 --> 00:11:49,280 Speaker 1: Things were a lot simpler back then, weren't they. And 266 00:11:49,360 --> 00:11:51,800 Speaker 1: so you know, Joel, you mentioned family. I think likewise, 267 00:11:51,920 --> 00:11:54,440 Speaker 1: like bringing kids into the world, if you've got massive 268 00:11:54,480 --> 00:11:57,599 Speaker 1: amounts of debt and maybe little to no income, that 269 00:11:57,640 --> 00:12:00,120 Speaker 1: doesn't make much sense. It's going to be really hard 270 00:12:00,120 --> 00:12:01,680 Speaker 1: to give them the care that they need if you 271 00:12:01,720 --> 00:12:06,040 Speaker 1: can't afford diapers, whether you're talking about disposable or cloth diapers. 272 00:12:06,320 --> 00:12:08,120 Speaker 1: And similar to getting married, it always feels like a 273 00:12:08,120 --> 00:12:11,280 Speaker 1: stretch to start having kids. Um. I think in many 274 00:12:11,320 --> 00:12:14,640 Speaker 1: ways you're completely unprepared for it, and there's nothing that 275 00:12:14,679 --> 00:12:18,080 Speaker 1: you could have actually done to fully prepare for having kids. 276 00:12:18,080 --> 00:12:21,000 Speaker 1: It just takes it's like actually having kids. It's similarly similarly, 277 00:12:21,000 --> 00:12:22,280 Speaker 1: you'd be like saying, you have to read all these 278 00:12:22,280 --> 00:12:24,880 Speaker 1: parenting books before you begin having kids, and not I'm 279 00:12:24,880 --> 00:12:27,040 Speaker 1: not against parenting books. I've brought a couple of myself, 280 00:12:27,240 --> 00:12:30,640 Speaker 1: but even those like they don't really prepare you for 281 00:12:30,679 --> 00:12:34,120 Speaker 1: having kids. And so yeah, it's probably helpful advice to 282 00:12:34,160 --> 00:12:36,480 Speaker 1: say read a parenting book or two, but it's also 283 00:12:36,559 --> 00:12:38,240 Speaker 1: like you don't. You don't have to before you have 284 00:12:38,320 --> 00:12:40,080 Speaker 1: kids exactly. And when it comes to the money, like 285 00:12:40,120 --> 00:12:42,560 Speaker 1: it's important maybe to talk to another friend who is 286 00:12:42,840 --> 00:12:44,319 Speaker 1: maybe has a kid who's a year old or two 287 00:12:44,360 --> 00:12:45,640 Speaker 1: years old and be like, hey, how much did it 288 00:12:45,640 --> 00:12:48,080 Speaker 1: cost you? How much do you now spend going to 289 00:12:48,120 --> 00:12:50,240 Speaker 1: the doctor. These are all good things to be aware of, 290 00:12:50,280 --> 00:12:51,920 Speaker 1: and that's something you can figure out in a fifteen 291 00:12:51,920 --> 00:12:54,760 Speaker 1: minute conversation. You don't have to spend you know, an 292 00:12:54,840 --> 00:12:57,760 Speaker 1: entire semester going through your own child reading class. Uh, 293 00:12:57,800 --> 00:13:01,040 Speaker 1: you know, based on reading books and so having some 294 00:13:01,120 --> 00:13:02,960 Speaker 1: of your financial ducks in a row before you start 295 00:13:03,000 --> 00:13:04,920 Speaker 1: trying to bring it as into the world is smart, 296 00:13:05,320 --> 00:13:07,120 Speaker 1: don't you know, get us wrong, Like we we do 297 00:13:07,200 --> 00:13:09,200 Speaker 1: think that it is worth preparing for a little bit. 298 00:13:09,360 --> 00:13:12,040 Speaker 1: But don't let this rule cause you to to over 299 00:13:12,120 --> 00:13:14,679 Speaker 1: prepare and wait too long when you really maybe you 300 00:13:14,720 --> 00:13:16,920 Speaker 1: want to get that family started now. Uh, And by 301 00:13:17,040 --> 00:13:21,439 Speaker 1: kicking that down the road, you're maybe sacrificing years of enjoyments, 302 00:13:21,480 --> 00:13:23,880 Speaker 1: you know, years of us satisfied life that you would 303 00:13:23,880 --> 00:13:26,680 Speaker 1: be able to enjoy were you to have those kids sooner, 304 00:13:26,760 --> 00:13:29,600 Speaker 1: no doubt. Yeah. And I think another one in the 305 00:13:29,679 --> 00:13:33,000 Speaker 1: lifestock category. The another matra or rule that has become 306 00:13:33,120 --> 00:13:36,760 Speaker 1: ingrained is that you should retire when you reach retirement age. 307 00:13:37,240 --> 00:13:38,840 Speaker 1: Makes sense, I guess because like it's in the name 308 00:13:39,000 --> 00:13:40,760 Speaker 1: retirements called that's what do you do it. That's when 309 00:13:40,760 --> 00:13:42,360 Speaker 1: we were tired. Kind of like speed limit Joel, you 310 00:13:42,559 --> 00:13:44,640 Speaker 1: shouldn't go faster than with the speed limits. Say, I know, 311 00:13:44,760 --> 00:13:48,720 Speaker 1: I'm an idiot, But when you reach full retirement age 312 00:13:48,800 --> 00:13:50,600 Speaker 1: in your mid sixties and then you can start taking 313 00:13:50,679 --> 00:13:54,840 Speaker 1: social Security funds. That that's why people really have started 314 00:13:54,880 --> 00:13:59,120 Speaker 1: to equate that date that time in their lives with 315 00:13:59,240 --> 00:14:02,280 Speaker 1: not working any or like they go together hand in hand. Right. Well, 316 00:14:02,480 --> 00:14:04,720 Speaker 1: it's also when you have access to your own retirement 317 00:14:04,720 --> 00:14:08,160 Speaker 1: accounts penalty free. But that rule overlooks the fact that 318 00:14:08,160 --> 00:14:10,679 Speaker 1: we all have different goals. You know, Warren Buffett Man, 319 00:14:10,760 --> 00:14:12,400 Speaker 1: he's still working at the age of ninety one. He 320 00:14:12,480 --> 00:14:14,520 Speaker 1: did not take that retirement date up on its promise. 321 00:14:14,520 --> 00:14:19,520 Speaker 1: He's like required minimum distributions. I laugh in the face 322 00:14:19,560 --> 00:14:21,960 Speaker 1: of those. But he's working because he gets a kick 323 00:14:22,000 --> 00:14:24,080 Speaker 1: out of it, like he enjoys it. It's it's obviously 324 00:14:24,120 --> 00:14:27,720 Speaker 1: not because he needs more money, right, um, And so yeah, 325 00:14:27,920 --> 00:14:30,080 Speaker 1: there's there's no need to stop working. If you love 326 00:14:30,120 --> 00:14:32,040 Speaker 1: what you do, you can keep working as long as 327 00:14:32,040 --> 00:14:34,680 Speaker 1: you want. Others find that retiring a whole lot sooner 328 00:14:34,760 --> 00:14:36,920 Speaker 1: works best for them, right, Some of our friends in 329 00:14:37,040 --> 00:14:39,920 Speaker 1: the Fire movement, they have found that not working past 330 00:14:40,040 --> 00:14:42,440 Speaker 1: the age of thirty five or forty has been great 331 00:14:42,440 --> 00:14:44,200 Speaker 1: for them, and they've gotten to pursue other things that 332 00:14:44,200 --> 00:14:46,200 Speaker 1: they love just as much, and they haven't had to 333 00:14:46,240 --> 00:14:49,840 Speaker 1: worry about providing an income for themselves, you know, for 334 00:14:50,240 --> 00:14:53,320 Speaker 1: decades where most people do have to work. We would say, 335 00:14:53,360 --> 00:14:57,040 Speaker 1: just don't let that arbitrary date define like when you 336 00:14:57,120 --> 00:14:59,920 Speaker 1: decided to take extended breaks from work, or ultimately when 337 00:15:00,080 --> 00:15:02,800 Speaker 1: you decide to hang it up, Like, there's no magical 338 00:15:02,920 --> 00:15:05,280 Speaker 1: rule that says that at fifty nine and a half 339 00:15:05,440 --> 00:15:08,200 Speaker 1: or at sixty six, like either of those dates. They 340 00:15:08,240 --> 00:15:11,600 Speaker 1: are magical from the fact that you can take money 341 00:15:11,680 --> 00:15:14,000 Speaker 1: from your retirement accounts or that you have reached full 342 00:15:14,120 --> 00:15:16,560 Speaker 1: Social Security age, but they're not magical from the standpoint 343 00:15:16,640 --> 00:15:18,760 Speaker 1: that it's a rule that you have to follow and 344 00:15:18,840 --> 00:15:21,520 Speaker 1: you should really stop working at that point, right. I mean, basically, 345 00:15:21,560 --> 00:15:23,520 Speaker 1: we want folks just to be intentional with what it 346 00:15:23,600 --> 00:15:26,120 Speaker 1: is that they're doing. It's a good number to be 347 00:15:26,160 --> 00:15:28,880 Speaker 1: aware of because yeah, there are laws that govern the 348 00:15:29,000 --> 00:15:31,920 Speaker 1: with you know, the withdrawal of funds from your retirement accounts, 349 00:15:31,920 --> 00:15:34,760 Speaker 1: but that doesn't mean that you personally aren't necessarily ready 350 00:15:34,880 --> 00:15:36,600 Speaker 1: for retirement. There are a lot of other things that 351 00:15:36,640 --> 00:15:39,160 Speaker 1: you also want to keep in mind, and so Joel. 352 00:15:39,160 --> 00:15:40,560 Speaker 1: There are also a lot of rules in the area 353 00:15:40,600 --> 00:15:43,400 Speaker 1: of debt paying off debt. I feel like it's fraught 354 00:15:43,400 --> 00:15:45,400 Speaker 1: with the different things that you're supposed to do, things 355 00:15:45,440 --> 00:15:47,320 Speaker 1: you that you should do, things you shouldn't do, rules 356 00:15:47,320 --> 00:15:50,960 Speaker 1: to obey. Yeah, some of those rules are helpful, others aren't. Uh, 357 00:15:50,960 --> 00:15:53,000 Speaker 1: And one of these things. Just generally speaking, in regards 358 00:15:53,040 --> 00:15:55,400 Speaker 1: to debt, there's just a whole group of folks out 359 00:15:55,400 --> 00:15:57,520 Speaker 1: there who feel that, you know, being debt free, like 360 00:15:57,560 --> 00:15:59,560 Speaker 1: that's the way to be, or they kind of take 361 00:15:59,560 --> 00:16:01,760 Speaker 1: the mantra that like debt is dumb and that's the rule, 362 00:16:01,880 --> 00:16:03,600 Speaker 1: like don't take on debt or you're an idiot no 363 00:16:03,640 --> 00:16:07,240 Speaker 1: matter what. And you know, we would ask the question like, 364 00:16:07,360 --> 00:16:09,560 Speaker 1: is that actually a good goal to have? You know, 365 00:16:09,640 --> 00:16:11,520 Speaker 1: is this a decent rule to live by? We do 366 00:16:11,560 --> 00:16:14,440 Speaker 1: feel that there are um what we would call worse 367 00:16:14,720 --> 00:16:17,800 Speaker 1: rules out there for sure, because we're not fans of debt. 368 00:16:18,360 --> 00:16:20,280 Speaker 1: We'd love to see how the money listeners paying off 369 00:16:20,320 --> 00:16:23,560 Speaker 1: their debts quickly. Lots of folks, for instance, prize having 370 00:16:23,600 --> 00:16:26,360 Speaker 1: that paid off mortgage. Uh. There's nothing inherently wrong with 371 00:16:26,400 --> 00:16:29,640 Speaker 1: not having any debt, but we believe that the responsible 372 00:16:29,760 --> 00:16:32,320 Speaker 1: use of debt in your life can be an approach 373 00:16:32,520 --> 00:16:34,720 Speaker 1: that makes a ton of sense for a lot of folks. 374 00:16:34,920 --> 00:16:36,240 Speaker 1: If you have your eyes open and you know what 375 00:16:36,280 --> 00:16:38,560 Speaker 1: you're doing. Often times it comes down to what you 376 00:16:38,680 --> 00:16:41,120 Speaker 1: are planning to do with that money instead of paying 377 00:16:41,160 --> 00:16:43,680 Speaker 1: it down, you know, towards that mortgage payment. Uh, and 378 00:16:43,720 --> 00:16:45,320 Speaker 1: so we just wanted to mention that there are times 379 00:16:45,320 --> 00:16:47,320 Speaker 1: when you know, debt makes sense, and we talked about 380 00:16:47,320 --> 00:16:50,600 Speaker 1: that back in episode one, and again it comes down 381 00:16:50,640 --> 00:16:53,400 Speaker 1: to being intentional with that money, right, Because if you 382 00:16:53,400 --> 00:16:54,800 Speaker 1: want to say I want to get rid of all 383 00:16:54,800 --> 00:16:57,800 Speaker 1: of debt in my life because I am really going 384 00:16:57,840 --> 00:17:00,840 Speaker 1: to benefit from the psychological piece that's gonna be able 385 00:17:00,840 --> 00:17:03,200 Speaker 1: to bring me, well, that's great. Do it for that reason. 386 00:17:03,640 --> 00:17:04,960 Speaker 1: Or if you're like, well I don't really care if 387 00:17:05,000 --> 00:17:06,760 Speaker 1: I have debt, well, what can I do instead with 388 00:17:06,760 --> 00:17:08,679 Speaker 1: that money? Well, if you're gonna take that money and 389 00:17:08,680 --> 00:17:11,120 Speaker 1: then invest it, well, then you're utilizing leverage in order 390 00:17:11,160 --> 00:17:14,680 Speaker 1: to see a higher return on your investment versus that 391 00:17:14,840 --> 00:17:17,840 Speaker 1: money that's going towards that mortgage, which can burn you 392 00:17:17,880 --> 00:17:20,080 Speaker 1: depending on what sort of leverage you're taking on. You know, 393 00:17:20,200 --> 00:17:22,560 Speaker 1: totally you don't want to over leverage. Yeah, and that's 394 00:17:22,600 --> 00:17:24,960 Speaker 1: the reason why Matt, like, if we're talking about credit cards, 395 00:17:24,960 --> 00:17:26,480 Speaker 1: that's one thing, but if we're talking about mortgage that 396 00:17:26,520 --> 00:17:29,520 Speaker 1: that's another. Right. And so like paying off your mortgage, 397 00:17:29,840 --> 00:17:32,159 Speaker 1: there's a reason why it's number seven. It's on the 398 00:17:32,200 --> 00:17:34,159 Speaker 1: seventh money year out of seven money years. Like there 399 00:17:34,200 --> 00:17:35,879 Speaker 1: are all these other things you want to do before 400 00:17:35,920 --> 00:17:40,399 Speaker 1: that that really takes like last precedence doing a really 401 00:17:40,400 --> 00:17:43,399 Speaker 1: low interest rate debt like a mortgage. There are a 402 00:17:43,440 --> 00:17:46,439 Speaker 1: lot of smart people holding on to that mortgage so 403 00:17:46,520 --> 00:17:48,360 Speaker 1: that they can do better things with that money. Right, 404 00:17:48,600 --> 00:17:51,359 Speaker 1: And speaking of credit cards, I think that's another rule 405 00:17:51,400 --> 00:17:53,359 Speaker 1: that we should bring up when it comes to debt, 406 00:17:53,640 --> 00:17:55,919 Speaker 1: is that credit cards or the devil. And uh, I 407 00:17:55,920 --> 00:17:58,600 Speaker 1: can just imagine you remember the Waterboy. I can imagine 408 00:17:58,640 --> 00:18:02,119 Speaker 1: Fool's ball, Fool's the devil, Bobby Boucher, I can imagine 409 00:18:02,119 --> 00:18:04,800 Speaker 1: his mom saying the same thing about credit cards. But yeah, 410 00:18:04,920 --> 00:18:09,320 Speaker 1: you know, we're all for moderated intelligent usage of credit cards, right, 411 00:18:09,560 --> 00:18:12,320 Speaker 1: utilizing the benefits that they offer and never paying the 412 00:18:12,359 --> 00:18:15,760 Speaker 1: credit card company's interest on purchases that you're making. But 413 00:18:15,880 --> 00:18:18,600 Speaker 1: avoiding credit cards altogether, well, that's a rule that isn't 414 00:18:18,600 --> 00:18:21,600 Speaker 1: worth following unless you know yourself that it's not gonna 415 00:18:21,680 --> 00:18:23,320 Speaker 1: end up well for you. Like if you know your 416 00:18:23,320 --> 00:18:26,240 Speaker 1: own behavioral tendencies and it's like, you know, if I 417 00:18:26,280 --> 00:18:28,040 Speaker 1: got a credit card in my life, I wouldn't be 418 00:18:28,040 --> 00:18:30,280 Speaker 1: able to handle it, then it's probably a rule that 419 00:18:30,320 --> 00:18:33,360 Speaker 1: you should never break. But for most Town of Money listeners, um, 420 00:18:33,400 --> 00:18:37,119 Speaker 1: they can break that rule and break it frequently because 421 00:18:37,160 --> 00:18:40,520 Speaker 1: they're paying their balances off in full, on time at 422 00:18:40,520 --> 00:18:42,520 Speaker 1: the end of the building cycle. Honestly, I guess we 423 00:18:42,640 --> 00:18:45,080 Speaker 1: just trust our listeners more, right, because essentially we're trusting 424 00:18:45,119 --> 00:18:46,800 Speaker 1: you to be in an adults and to make the 425 00:18:47,160 --> 00:18:51,160 Speaker 1: wise informed decisions based on what you know about yourself. Um. 426 00:18:51,200 --> 00:18:53,359 Speaker 1: I think that's a big reason why these rules we 427 00:18:53,440 --> 00:18:56,080 Speaker 1: feel can be bent a little bit. And again in 428 00:18:56,119 --> 00:18:59,040 Speaker 1: our case, I mean, the reason we talk about credit 429 00:18:59,040 --> 00:19:00,840 Speaker 1: cards so much is because, first of all, I mean, 430 00:19:00,840 --> 00:19:03,560 Speaker 1: the benefits are real, right when we're talking about serious 431 00:19:03,840 --> 00:19:06,680 Speaker 1: cash back, we're talking about serious sign up bonuses that 432 00:19:06,720 --> 00:19:09,199 Speaker 1: you get, serious protections that that you get as a 433 00:19:09,240 --> 00:19:12,119 Speaker 1: consumer when you use those cards. But secondly, and you 434 00:19:12,200 --> 00:19:14,399 Speaker 1: touched on the show, but I mean I have not 435 00:19:14,440 --> 00:19:17,560 Speaker 1: paid a single sense and interest ever to a credit 436 00:19:17,560 --> 00:19:19,879 Speaker 1: card company, like I know myself in same with you. 437 00:19:20,040 --> 00:19:22,160 Speaker 1: And so because of that, these are benefits that we 438 00:19:22,520 --> 00:19:25,000 Speaker 1: have a little more flexibility, a little more freedom around. 439 00:19:25,400 --> 00:19:28,960 Speaker 1: We're not as concerned about the temptation to spend. For us, 440 00:19:28,960 --> 00:19:30,919 Speaker 1: it's just not something we have to wrestle with and 441 00:19:31,000 --> 00:19:33,159 Speaker 1: when you have a bunch of debt, how you go 442 00:19:33,280 --> 00:19:35,600 Speaker 1: about paying that debt off is another rule that you 443 00:19:35,680 --> 00:19:38,560 Speaker 1: often hear. For instance, the debt snowball method is the 444 00:19:38,600 --> 00:19:42,960 Speaker 1: most effective way to pay down debt. Well, not necessarily right, 445 00:19:43,400 --> 00:19:45,520 Speaker 1: That's a rule that you often hear. And we actually 446 00:19:45,520 --> 00:19:48,520 Speaker 1: did an episode about the debt snowball approach versus going 447 00:19:48,560 --> 00:19:50,840 Speaker 1: the avalanche route, and we kind of came down somewhere 448 00:19:50,840 --> 00:19:53,080 Speaker 1: in the middle. The avalanche route is best for paying 449 00:19:53,200 --> 00:19:56,840 Speaker 1: the least overall amount in interest, but it doesn't have 450 00:19:56,960 --> 00:20:00,960 Speaker 1: the helpful psychological component of picking off your smallest debts quickly, 451 00:20:01,280 --> 00:20:03,920 Speaker 1: which gives you momentum. And so we kind of prefer 452 00:20:04,000 --> 00:20:06,240 Speaker 1: the both and approach, you know. And so if the 453 00:20:06,240 --> 00:20:09,080 Speaker 1: interest rates are similar, go with the smallest balance, because 454 00:20:09,119 --> 00:20:12,560 Speaker 1: then you'll, you know, realize some of that psychological momentum, 455 00:20:12,800 --> 00:20:15,560 Speaker 1: and you clear a hurdle by knocking off a balance 456 00:20:15,640 --> 00:20:17,720 Speaker 1: that's really small, and it's like, exactly gives you the 457 00:20:18,320 --> 00:20:20,239 Speaker 1: fortitude to keep pressing on. Sure, Yeah, but if you've 458 00:20:20,240 --> 00:20:22,520 Speaker 1: got a car loan, say maybe just at four percent, 459 00:20:22,800 --> 00:20:25,240 Speaker 1: but then you also have credit card debt, say at nineteen, 460 00:20:26,200 --> 00:20:28,800 Speaker 1: you'd be crazy to pay off that car Loan first, 461 00:20:28,840 --> 00:20:31,479 Speaker 1: and so that's an instance where you need to actually 462 00:20:31,480 --> 00:20:33,359 Speaker 1: look at what you've got going on. There is no 463 00:20:33,440 --> 00:20:36,000 Speaker 1: clear black or white answer when it comes to a 464 00:20:36,040 --> 00:20:38,080 Speaker 1: lot of things in life, including when it comes to 465 00:20:38,160 --> 00:20:40,000 Speaker 1: paying down your debt. And so those are a few 466 00:20:40,119 --> 00:20:43,520 Speaker 1: rules that effect not only our lifestyle, but how does 467 00:20:43,560 --> 00:20:46,879 Speaker 1: that we go about paying uh and interacting with our debts? 468 00:20:47,040 --> 00:20:48,520 Speaker 1: And so, Joe, we've got a few other areas, a 469 00:20:48,520 --> 00:20:50,399 Speaker 1: few other ways that we handle our money, and we're 470 00:20:50,440 --> 00:20:52,199 Speaker 1: gonna talk about some of the rules that pertain to 471 00:20:52,320 --> 00:20:55,320 Speaker 1: those aspects of our personal finances. And we'll get to 472 00:20:55,320 --> 00:21:06,560 Speaker 1: those right after this break. All right, we are back, 473 00:21:06,760 --> 00:21:09,280 Speaker 1: and Matt, let's keep talking about some of the crappier 474 00:21:09,280 --> 00:21:12,280 Speaker 1: personal finance rules and how we can break them. I'm 475 00:21:12,280 --> 00:21:15,320 Speaker 1: trying to think of have you done the milk crate challenge? 476 00:21:15,320 --> 00:21:18,080 Speaker 1: I've seen that going around. We want to break them. 477 00:21:18,359 --> 00:21:20,280 Speaker 1: I haven't in the milk crates? Well, first of all, 478 00:21:20,280 --> 00:21:22,320 Speaker 1: where do people find all these milks? Either? I don't 479 00:21:22,320 --> 00:21:24,000 Speaker 1: know where do you get? Like? First, I mean, I 480 00:21:24,000 --> 00:21:26,320 Speaker 1: didn't think those were what am I thinking of? I'm 481 00:21:26,320 --> 00:21:30,080 Speaker 1: thinking of like the old post office mail crates? Remember 482 00:21:30,160 --> 00:21:32,280 Speaker 1: I used to work an be safer, I think than well, no, 483 00:21:32,359 --> 00:21:34,000 Speaker 1: those were made of like this kind of plastic thing. 484 00:21:34,200 --> 00:21:37,000 Speaker 1: But even still your hang like they're like this is 485 00:21:37,000 --> 00:21:38,679 Speaker 1: a government property. Like where do these people get all 486 00:21:38,720 --> 00:21:40,280 Speaker 1: these milk crates? I guess a lot of folks working 487 00:21:40,320 --> 00:21:43,000 Speaker 1: at all they or something. Yeah maybe, but uh they 488 00:21:43,040 --> 00:21:44,960 Speaker 1: got that hook up from from leetle. We want to 489 00:21:45,000 --> 00:21:47,040 Speaker 1: smash them. These personal finance rules, the way people are 490 00:21:47,080 --> 00:21:50,520 Speaker 1: specting their bodies as they fall off this car pile 491 00:21:50,560 --> 00:21:52,639 Speaker 1: of milk rates. But yeah, we just talked about some 492 00:21:52,680 --> 00:21:55,199 Speaker 1: of the rules that shape our lifestyle, how we pursue 493 00:21:56,400 --> 00:21:58,680 Speaker 1: the meaningful events in our lives, and how sometimes those 494 00:21:58,680 --> 00:22:00,280 Speaker 1: hold us back from doing the things that we want 495 00:22:00,600 --> 00:22:02,960 Speaker 1: because there are these ingrained rules that we listen to, 496 00:22:03,480 --> 00:22:05,600 Speaker 1: and the same when it comes to debt and debt payoff. 497 00:22:06,160 --> 00:22:09,479 Speaker 1: We believe these things without questioning them, and if we 498 00:22:09,480 --> 00:22:11,240 Speaker 1: were to question them, we would be able to maybe 499 00:22:11,240 --> 00:22:13,199 Speaker 1: proceed in a different way that would be better for 500 00:22:13,240 --> 00:22:15,760 Speaker 1: our lives. Um. Now, let'shift to like saving an investing 501 00:22:15,760 --> 00:22:18,080 Speaker 1: mat and some of the rules that define those areas 502 00:22:18,280 --> 00:22:21,520 Speaker 1: that we think are off base, and let's specifically talk 503 00:22:21,560 --> 00:22:24,800 Speaker 1: about emergency funds for seconds. There are quite a fuel 504 00:22:24,880 --> 00:22:26,840 Speaker 1: rules that we think have some been to them in 505 00:22:26,840 --> 00:22:28,919 Speaker 1: this arena. You know, you and I we've done our 506 00:22:29,000 --> 00:22:31,880 Speaker 1: fair share of talking about emergency funds and the priority 507 00:22:31,920 --> 00:22:33,960 Speaker 1: that they should take in your financial life. We really, 508 00:22:34,280 --> 00:22:37,080 Speaker 1: we think they're important. They provide a lot of stability 509 00:22:37,160 --> 00:22:40,440 Speaker 1: for people. It's nice to know that if the crap 510 00:22:40,520 --> 00:22:42,720 Speaker 1: hits the fan, that you've got money in the bank 511 00:22:42,760 --> 00:22:45,560 Speaker 1: account to back you up. But there are more ways 512 00:22:45,680 --> 00:22:48,080 Speaker 1: than just one to skin a cats And the rule 513 00:22:48,160 --> 00:22:50,080 Speaker 1: that many financial experts give is that you should have 514 00:22:50,080 --> 00:22:53,680 Speaker 1: six months of savings on hand to combat a potential emergency. 515 00:22:53,920 --> 00:22:56,480 Speaker 1: Some go further and they make their rule twelve months 516 00:22:56,480 --> 00:22:58,239 Speaker 1: of cash on hand, which, honestly, I feel like it's 517 00:22:58,240 --> 00:23:00,240 Speaker 1: actually kind of demoralizing for most people because are like, 518 00:23:00,280 --> 00:23:02,080 Speaker 1: how in the world am I ever going to get 519 00:23:02,320 --> 00:23:03,840 Speaker 1: to that? I mean, I remember thinking that in my 520 00:23:03,880 --> 00:23:06,600 Speaker 1: early twenties, like, that's a lot of money. That feels impossible. 521 00:23:06,920 --> 00:23:08,760 Speaker 1: I've got all these other things to do. What you're 522 00:23:08,760 --> 00:23:10,439 Speaker 1: saying is going to take me eight years to achieve. 523 00:23:10,800 --> 00:23:12,840 Speaker 1: But but yeah, there are other ways that you can 524 00:23:12,840 --> 00:23:16,600 Speaker 1: have access to emergency cash without running up the credit cards, right, 525 00:23:16,760 --> 00:23:19,399 Speaker 1: and maybe we should consider some of these other avenues 526 00:23:19,440 --> 00:23:22,320 Speaker 1: as opposed to just having ridiculous amount of money in 527 00:23:22,520 --> 00:23:25,160 Speaker 1: savings totally. Yeah, So having a helock a home equity 528 00:23:25,280 --> 00:23:27,639 Speaker 1: line of credit as a backup, that's one way to 529 00:23:27,680 --> 00:23:30,199 Speaker 1: make this rule more of a helpful recommendation that you 530 00:23:30,200 --> 00:23:33,359 Speaker 1: can do without if you so choose. Helocks are great 531 00:23:33,400 --> 00:23:36,520 Speaker 1: backup emergency funds because they usually cost zero dollars to 532 00:23:36,520 --> 00:23:38,680 Speaker 1: set up and you don't pay interest on that money 533 00:23:38,760 --> 00:23:41,880 Speaker 1: unless you make a withdrawal. So this is only available 534 00:23:41,920 --> 00:23:45,040 Speaker 1: for homeowners obviously, but it could be worthwhile to have 535 00:23:45,119 --> 00:23:47,679 Speaker 1: a helock backup in case just kind of sitting there 536 00:23:47,720 --> 00:23:49,880 Speaker 1: in the wings. That way you can retain a smaller 537 00:23:49,920 --> 00:23:52,119 Speaker 1: emergency fund. But now that this is only something that 538 00:23:52,160 --> 00:23:54,840 Speaker 1: we would recommend if you're trying to invest more of 539 00:23:54,840 --> 00:23:57,119 Speaker 1: your money. Basically want you to do smart things with 540 00:23:57,160 --> 00:23:59,800 Speaker 1: your money, not have less cash on hand so that 541 00:23:59,840 --> 00:24:02,000 Speaker 1: you can blow that money, so that so that you 542 00:24:02,000 --> 00:24:03,680 Speaker 1: can spend it in an absorb it into your life 543 00:24:03,760 --> 00:24:05,200 Speaker 1: trying to go to the heat. So I'm gonna blow 544 00:24:05,240 --> 00:24:09,320 Speaker 1: my emergency fund and have the helock is the backup. Yeah, 545 00:24:09,400 --> 00:24:11,080 Speaker 1: And and even with that, we still think that a 546 00:24:11,080 --> 00:24:13,879 Speaker 1: good minimum emergency fund goal of three months worth of 547 00:24:13,920 --> 00:24:17,360 Speaker 1: expenses on hand uh is important, But even still, it's 548 00:24:17,359 --> 00:24:20,000 Speaker 1: worth mentioning that he locks. And we saw this with 549 00:24:20,040 --> 00:24:22,919 Speaker 1: a pandemic last spring, but some banks actually stopped offering 550 00:24:23,000 --> 00:24:25,240 Speaker 1: those products because their risk here. Uh. And so it's 551 00:24:25,280 --> 00:24:26,840 Speaker 1: important to keep that in mind that they may not 552 00:24:26,920 --> 00:24:29,480 Speaker 1: always be available. If you're like, you know what, I'm 553 00:24:29,480 --> 00:24:32,639 Speaker 1: just gonna get myself a new helock, because it's important 554 00:24:32,680 --> 00:24:34,960 Speaker 1: to keep in mind too that sometimes they only are 555 00:24:35,000 --> 00:24:37,600 Speaker 1: available to you for like five or ten years, at 556 00:24:37,600 --> 00:24:39,520 Speaker 1: which point they basically expire, so they kind of have 557 00:24:39,520 --> 00:24:41,840 Speaker 1: a shelf life. And if you'd been counting on that 558 00:24:41,920 --> 00:24:44,480 Speaker 1: helock as your emergency fund and it kind of disappeared 559 00:24:44,440 --> 00:24:46,840 Speaker 1: and all of a sudden, you might be sitting without 560 00:24:46,880 --> 00:24:49,439 Speaker 1: that money in the bank, uh and without a product 561 00:24:49,520 --> 00:24:51,679 Speaker 1: to rely on if you needed it. Yeah, And and 562 00:24:51,680 --> 00:24:53,359 Speaker 1: that another question that we get when it comes to 563 00:24:53,359 --> 00:24:56,159 Speaker 1: emergency funds. People want to know if they can invest it, 564 00:24:56,440 --> 00:24:58,439 Speaker 1: and usually you know, we're saying no, no, no no no. 565 00:24:58,720 --> 00:25:02,159 Speaker 1: For in particular or three months worth of expenses, that 566 00:25:02,200 --> 00:25:04,600 Speaker 1: money needs to stay in your same news account. For us, 567 00:25:04,640 --> 00:25:06,240 Speaker 1: that is a hard and fast rule. But when it 568 00:25:06,280 --> 00:25:08,840 Speaker 1: comes to that six to twelve month realm that a 569 00:25:08,840 --> 00:25:11,240 Speaker 1: lot of other people talk about. We think that you 570 00:25:11,320 --> 00:25:13,720 Speaker 1: can invest some of that emergency fund and and and 571 00:25:13,840 --> 00:25:16,000 Speaker 1: in particular, it needs to be in a wrath I 572 00:25:16,240 --> 00:25:19,560 Speaker 1: RA that allows um it can act as another buffer, 573 00:25:19,920 --> 00:25:22,280 Speaker 1: which can let you roll with that smaller bucket of 574 00:25:22,320 --> 00:25:24,840 Speaker 1: savings as opposed to feeling like you have to have 575 00:25:24,880 --> 00:25:28,719 Speaker 1: this fully funded, enormous emergency fund. And if you've been 576 00:25:28,760 --> 00:25:31,560 Speaker 1: maxing out a wrath over let's say the last five years, 577 00:25:31,880 --> 00:25:34,919 Speaker 1: then this should provide you with a really nice backstop, 578 00:25:35,119 --> 00:25:37,280 Speaker 1: allowing you to feel a whole lot more comfortable having 579 00:25:37,440 --> 00:25:40,080 Speaker 1: less cash in your account. It's still ideal, of course, 580 00:25:40,080 --> 00:25:42,560 Speaker 1: to not take money out if you're off like, uh, 581 00:25:43,119 --> 00:25:45,680 Speaker 1: you want to tap your savings money in the case 582 00:25:45,680 --> 00:25:48,320 Speaker 1: of an emergency first, not the money you have invested 583 00:25:48,320 --> 00:25:50,360 Speaker 1: in the wrath. In a perfect world, you put money 584 00:25:50,400 --> 00:25:52,240 Speaker 1: in the wrath and you never touch it until you 585 00:25:52,280 --> 00:25:54,959 Speaker 1: reach retirement age. UM. You know when you're whether you're 586 00:25:55,000 --> 00:25:57,400 Speaker 1: still working or not. Uh. And and then yeah, if 587 00:25:57,440 --> 00:26:00,959 Speaker 1: you need to tap those those roth funds, it's important 588 00:26:01,000 --> 00:26:04,080 Speaker 1: to only take out the contributions, not the earnings, because 589 00:26:04,160 --> 00:26:06,320 Speaker 1: that's what you have access to tax and penalty free. 590 00:26:06,560 --> 00:26:10,240 Speaker 1: But a wrath that you have been consistently funding, uh, 591 00:26:10,280 --> 00:26:13,480 Speaker 1: and it's been growing across the years can allow you 592 00:26:13,560 --> 00:26:17,320 Speaker 1: to skirt that hefty fun rule unspent HSA dollars. That's uh. 593 00:26:17,400 --> 00:26:19,240 Speaker 1: That's another place math that people can look to. I 594 00:26:19,280 --> 00:26:22,360 Speaker 1: think that those that money that's been growing consistently over 595 00:26:22,359 --> 00:26:25,399 Speaker 1: the years can provide similar peace of mind, allowing you 596 00:26:25,440 --> 00:26:28,080 Speaker 1: to have less money in savings. And you've got the 597 00:26:28,119 --> 00:26:31,040 Speaker 1: receipts for some of those healthcare procedures that you've had done, 598 00:26:31,359 --> 00:26:33,760 Speaker 1: yet you've left that money growing in the hs A. Well, 599 00:26:33,760 --> 00:26:36,240 Speaker 1: when an emergency comes along, you can grab that money 600 00:26:36,280 --> 00:26:38,720 Speaker 1: from the hs A and pull it out. Um. They're 601 00:26:38,760 --> 00:26:41,040 Speaker 1: just like this really flexible account that, if used well, 602 00:26:41,480 --> 00:26:44,280 Speaker 1: can act as a helpful fund backup. So yeah, the 603 00:26:44,320 --> 00:26:47,000 Speaker 1: six to twelve month figure, Like I get why people 604 00:26:47,040 --> 00:26:49,159 Speaker 1: say that it's really hard for most people to achieve. 605 00:26:49,240 --> 00:26:51,639 Speaker 1: And using some of these other ways to kind of 606 00:26:51,720 --> 00:26:54,760 Speaker 1: use as a backstop for a smaller e fund I 607 00:26:54,800 --> 00:26:57,119 Speaker 1: think can make a lot of sense. That's right. And 608 00:26:57,160 --> 00:26:58,800 Speaker 1: so when it comes to so that's saving, right, we're 609 00:26:58,800 --> 00:27:01,280 Speaker 1: talking about emergency funds. When it comes to investing, a 610 00:27:01,359 --> 00:27:03,840 Speaker 1: rule that we often hear is you should be saving, 611 00:27:04,000 --> 00:27:07,359 Speaker 1: you should be investing of your paycheck. And this is 612 00:27:07,400 --> 00:27:10,199 Speaker 1: actually a rule that you've heard on this show before. 613 00:27:10,840 --> 00:27:12,719 Speaker 1: Because we're gonnareak own rules. We we kind of are 614 00:27:12,760 --> 00:27:16,080 Speaker 1: here like the height of anarchy. I appreciate that about us. Uh, 615 00:27:16,760 --> 00:27:18,520 Speaker 1: you know, we believe that this is a great goal 616 00:27:18,600 --> 00:27:21,040 Speaker 1: for most folks to aim for, because only putting a 617 00:27:21,040 --> 00:27:23,840 Speaker 1: side ten percent of your income over your entire working life, 618 00:27:24,040 --> 00:27:26,280 Speaker 1: that probably isn't going to be quite enough to provide 619 00:27:26,280 --> 00:27:29,520 Speaker 1: the financial security that we think most folks should be 620 00:27:29,520 --> 00:27:32,040 Speaker 1: aiming for. But yeah, we're gonna break our own rule here. 621 00:27:32,160 --> 00:27:35,000 Speaker 1: Let's say that you're one of those overachieving coast firefolks 622 00:27:35,160 --> 00:27:38,000 Speaker 1: who's been maxing out the retirement accounts for a decade 623 00:27:38,080 --> 00:27:40,800 Speaker 1: or longer, maybe even you know, maybe potentially you've been 624 00:27:40,840 --> 00:27:43,919 Speaker 1: saving and investing, say fifty percent of your salary. Uh 625 00:27:44,040 --> 00:27:45,960 Speaker 1: So now you might be asking, can you cut back 626 00:27:46,080 --> 00:27:48,359 Speaker 1: save only five to ten percent of maybe what you're 627 00:27:48,359 --> 00:27:50,399 Speaker 1: bringing in? Sure, you've already done the hard work of 628 00:27:50,400 --> 00:27:53,720 Speaker 1: putting aside massive amounts of earnings earlier in your life, 629 00:27:53,840 --> 00:27:56,080 Speaker 1: and so putting aside fifteen percent of what you make 630 00:27:56,119 --> 00:27:58,439 Speaker 1: each year is a great goal, but doing a little 631 00:27:58,440 --> 00:28:01,520 Speaker 1: more or less to sending on your specific near term 632 00:28:01,760 --> 00:28:05,600 Speaker 1: goals is okay as well. And again I don't want 633 00:28:05,600 --> 00:28:08,200 Speaker 1: to kind of gloss over the saving more side of it. 634 00:28:08,800 --> 00:28:11,760 Speaker 1: Percent is great, but if you can save five percent 635 00:28:11,880 --> 00:28:14,080 Speaker 1: of your income, that's even better. We don't want you 636 00:28:14,160 --> 00:28:16,040 Speaker 1: to think that just because there's this rule of oh, 637 00:28:16,080 --> 00:28:19,000 Speaker 1: you should be shooting for, that doesn't mean you can't 638 00:28:19,040 --> 00:28:20,760 Speaker 1: save more. You should be, you know, shooting for at 639 00:28:20,840 --> 00:28:22,920 Speaker 1: least fifteen percent. Yeah, we don't want to set the 640 00:28:22,960 --> 00:28:25,520 Speaker 1: bar too low for how the money listeners who are 641 00:28:25,640 --> 00:28:28,680 Speaker 1: energized to save more and the ultimately what happens Matt. 642 00:28:28,720 --> 00:28:32,199 Speaker 1: The more you're able to save at younger ages, the 643 00:28:32,240 --> 00:28:34,360 Speaker 1: more options you open up for yourself later on down 644 00:28:34,359 --> 00:28:37,320 Speaker 1: the line. And for many of us, we don't know 645 00:28:37,400 --> 00:28:39,160 Speaker 1: what the future holds like. We don't know what it's 646 00:28:39,160 --> 00:28:41,160 Speaker 1: gonna look like family wise, we don't know how our 647 00:28:41,200 --> 00:28:42,960 Speaker 1: goals are going to change. A job that we like 648 00:28:43,040 --> 00:28:44,520 Speaker 1: now might be a job that we don't like a 649 00:28:44,520 --> 00:28:46,680 Speaker 1: few years from now, And so the more we save, 650 00:28:46,840 --> 00:28:50,040 Speaker 1: the more flexibility we really are setting ourselves up for 651 00:28:50,200 --> 00:28:52,960 Speaker 1: later on down the line. Another rule when it comes 652 00:28:53,000 --> 00:28:56,800 Speaker 1: to investing is don't buy single stocks and don't speculate, 653 00:28:57,120 --> 00:28:59,960 Speaker 1: and in particular, UH, I think people are saying don't 654 00:29:00,000 --> 00:29:02,680 Speaker 1: speculate on cryptocurrency right now, and you'll you'll hear this 655 00:29:02,760 --> 00:29:05,160 Speaker 1: rule a lot, and it's a rule that we mostly 656 00:29:05,280 --> 00:29:09,000 Speaker 1: like and also follow. But breaking this rule in small 657 00:29:09,040 --> 00:29:11,960 Speaker 1: ways is fine and actually potentially a smart move because 658 00:29:12,040 --> 00:29:16,720 Speaker 1: if you keep those investments, the super speculative or single 659 00:29:16,720 --> 00:29:20,080 Speaker 1: stock investments, to five percent of your portfolio or less, 660 00:29:20,360 --> 00:29:22,640 Speaker 1: you know, blowing off some steam by doing small amounts 661 00:29:22,640 --> 00:29:25,160 Speaker 1: of trading UH. In that way, that can be smart 662 00:29:25,240 --> 00:29:27,320 Speaker 1: if it allows you to stay the course with the 663 00:29:27,320 --> 00:29:29,760 Speaker 1: massive chunk of your money and sticking to index funds, 664 00:29:29,840 --> 00:29:33,200 Speaker 1: which is our favorite approach to investing with of your 665 00:29:33,200 --> 00:29:36,920 Speaker 1: long term dough Sometimes just dabbling with with that can 666 00:29:36,960 --> 00:29:39,960 Speaker 1: actually provide the mental fortuity to kind of stick to 667 00:29:40,040 --> 00:29:42,320 Speaker 1: it with the other stuff, do the boring stuff. If 668 00:29:42,320 --> 00:29:44,400 Speaker 1: you have just like a little bit that that exposure 669 00:29:44,440 --> 00:29:47,640 Speaker 1: to the investing excitement that usually actually leads to regret 670 00:29:47,640 --> 00:29:50,200 Speaker 1: for most people. UM. But it is one of those 671 00:29:50,240 --> 00:29:53,080 Speaker 1: ways I think which you can learn a lesson if 672 00:29:53,360 --> 00:29:55,960 Speaker 1: if you're doing too much of it. UM. But doing 673 00:29:55,960 --> 00:29:58,520 Speaker 1: it in small amounts, I think, really isn't that big 674 00:29:58,560 --> 00:30:00,760 Speaker 1: of a deal. And so that's a rule that it 675 00:30:00,840 --> 00:30:03,080 Speaker 1: can be broken, at least, you know, in a small way, 676 00:30:03,320 --> 00:30:05,360 Speaker 1: that's right. Another rule that we've often heard is that 677 00:30:05,400 --> 00:30:07,959 Speaker 1: if you love your kids, you'll start saving for their college. 678 00:30:08,040 --> 00:30:09,920 Speaker 1: Now that's why I tell my kids that I don't 679 00:30:09,920 --> 00:30:13,360 Speaker 1: love them, because I'm not saving for your college. You know. 680 00:30:14,000 --> 00:30:16,440 Speaker 1: Uh no, this rule was definitely made to be broken 681 00:30:16,640 --> 00:30:18,920 Speaker 1: because there are so many ways to pay for college, 682 00:30:19,400 --> 00:30:21,440 Speaker 1: but there are only a couple of ways when it 683 00:30:21,440 --> 00:30:24,240 Speaker 1: comes to funding your retirement, and so this should be 684 00:30:24,440 --> 00:30:26,960 Speaker 1: a much lower priority for most parents. You know. All 685 00:30:26,960 --> 00:30:29,840 Speaker 1: that to say, we're not anti five accounts, but we 686 00:30:29,880 --> 00:30:32,320 Speaker 1: do think that you should only open one if you're 687 00:30:32,320 --> 00:30:34,960 Speaker 1: in money gear number seven and you're already crushing it 688 00:30:35,000 --> 00:30:38,240 Speaker 1: with your own personal money goals. And remember that not 689 00:30:38,400 --> 00:30:40,880 Speaker 1: funding their college costs from the day that they're you know, 690 00:30:40,920 --> 00:30:42,920 Speaker 1: that they're born. That does not mean that you love 691 00:30:42,960 --> 00:30:44,560 Speaker 1: them any less. So I can start telling my kids 692 00:30:44,640 --> 00:30:46,680 Speaker 1: contrary to what you love, saying yeah, yeah, you can 693 00:30:46,760 --> 00:30:48,240 Speaker 1: look good. Okay, all right, I'll tell him what I 694 00:30:48,240 --> 00:30:49,760 Speaker 1: get home, tell him tonight. They'll be so glad to 695 00:30:49,800 --> 00:30:52,960 Speaker 1: hear it. Uh and yeah, so I but I agree, Matt. 696 00:30:53,000 --> 00:30:55,080 Speaker 1: I think that's another money year number seven thing. You know, 697 00:30:55,080 --> 00:30:57,120 Speaker 1: we talked about paying off the mortgage, saving for your 698 00:30:57,160 --> 00:31:00,520 Speaker 1: kids college, like those are decent uh olds to have, 699 00:31:00,720 --> 00:31:03,360 Speaker 1: But there are goals that you have once you reach 700 00:31:03,760 --> 00:31:06,720 Speaker 1: an immense amount of financial stability, not earlier on in 701 00:31:06,760 --> 00:31:09,640 Speaker 1: the process. Um. And it's not a hard and fast 702 00:31:09,720 --> 00:31:11,760 Speaker 1: rule either. You're more than welcome once you get to 703 00:31:11,800 --> 00:31:13,760 Speaker 1: money your seven to do all sorts of other things 704 00:31:13,840 --> 00:31:16,080 Speaker 1: instead of saving for your kids college if you want, 705 00:31:16,280 --> 00:31:19,000 Speaker 1: or saving and investing at all. I mean, if you're larger, 706 00:31:19,040 --> 00:31:21,400 Speaker 1: money goals have to do with spending a lot more money. 707 00:31:21,440 --> 00:31:23,120 Speaker 1: That's up to you. You know, as long as you've 708 00:31:23,120 --> 00:31:25,360 Speaker 1: taken care of those other steps, you're essentially you're kind 709 00:31:25,360 --> 00:31:27,560 Speaker 1: of free to do whatever you want exactly. Yeah, and 710 00:31:27,680 --> 00:31:30,760 Speaker 1: uh yeah, there's some financial rules that feel like they're 711 00:31:30,760 --> 00:31:32,840 Speaker 1: a bit more rigid than others. Like earlier we were 712 00:31:32,880 --> 00:31:35,320 Speaker 1: talking about the roth IRA and uh you might know 713 00:31:35,440 --> 00:31:38,040 Speaker 1: that in one a single tax filer needs to have 714 00:31:38,040 --> 00:31:41,240 Speaker 1: a modified adjusted gross income of a hundred forty dollars 715 00:31:41,320 --> 00:31:44,080 Speaker 1: or less in order to be able to contribute to 716 00:31:44,080 --> 00:31:48,240 Speaker 1: one and married filing jointly, You're Maggie needs to be 717 00:31:48,320 --> 00:31:52,560 Speaker 1: less than two eight thousand dollars, right, But even when 718 00:31:52,560 --> 00:31:54,520 Speaker 1: it comes to the I R s, there are ways 719 00:31:54,560 --> 00:31:57,440 Speaker 1: that you can bend and actually break these rules. Make 720 00:31:57,440 --> 00:32:00,360 Speaker 1: sure you kind of know the tax rules are around 721 00:32:00,440 --> 00:32:03,680 Speaker 1: the backdoor wrath, but there are no income limits when 722 00:32:03,680 --> 00:32:06,280 Speaker 1: it comes to doing these conversions. Um, and yeah, so 723 00:32:06,320 --> 00:32:09,200 Speaker 1: this is what people refer to commonly as the backdoor wrath. 724 00:32:09,640 --> 00:32:11,520 Speaker 1: And uh, yeah, this is how you would go about 725 00:32:11,520 --> 00:32:14,880 Speaker 1: allowing your contributions and earnings to grow tax free. So 726 00:32:15,120 --> 00:32:17,120 Speaker 1: there's this rule that we've all heard, Matt that says 727 00:32:17,320 --> 00:32:19,000 Speaker 1: if you make up a certain amount of money, you 728 00:32:19,000 --> 00:32:22,000 Speaker 1: can't contribute to the roth ira, which is an account 729 00:32:22,000 --> 00:32:23,680 Speaker 1: that you and I we love and we've sung the 730 00:32:23,680 --> 00:32:26,479 Speaker 1: praises of over the years. But it turns out that 731 00:32:26,480 --> 00:32:28,760 Speaker 1: that rule can be broken, um, if you're doing a 732 00:32:28,800 --> 00:32:32,200 Speaker 1: backdoor rath, which is not nearly as publicized and not 733 00:32:32,240 --> 00:32:34,640 Speaker 1: many people know about it, but it allows you access 734 00:32:35,080 --> 00:32:38,920 Speaker 1: to putting money into a wrath account, which can be 735 00:32:38,960 --> 00:32:41,520 Speaker 1: really really helpful from a tax planning perspective. You're just 736 00:32:41,520 --> 00:32:43,280 Speaker 1: gonna want to make sure you know all the details 737 00:32:43,280 --> 00:32:46,120 Speaker 1: before you jump in. So hopefully we just smashed a 738 00:32:46,120 --> 00:32:49,000 Speaker 1: few investing rules maybe that you had in your mind 739 00:32:49,360 --> 00:32:53,200 Speaker 1: that aren't as helpful as maybe previously thoughts. We've got 740 00:32:53,280 --> 00:32:56,880 Speaker 1: more restricting preventing you from doing something that you should 741 00:32:56,880 --> 00:32:58,760 Speaker 1: be doing with your money when you've really wanted to. 742 00:32:58,800 --> 00:33:01,400 Speaker 1: But you're like the rule series, and yeah, we want 743 00:33:01,440 --> 00:33:03,200 Speaker 1: to give you the freedom to kind of to fight 744 00:33:03,240 --> 00:33:06,200 Speaker 1: back against some of those limiting rules. But yeah, let's 745 00:33:06,200 --> 00:33:09,560 Speaker 1: get to some more rules map in particular about spending 746 00:33:09,600 --> 00:33:11,840 Speaker 1: and earning. We'll get to some rules that are maybe 747 00:33:11,880 --> 00:33:23,440 Speaker 1: holding us back in those realms right after this. All right, 748 00:33:23,480 --> 00:33:24,960 Speaker 1: we're back from the break. We're talking about some of 749 00:33:24,960 --> 00:33:27,680 Speaker 1: the different financial rules that we come across and why 750 00:33:27,720 --> 00:33:30,440 Speaker 1: it is that we think you should be breaking these 751 00:33:30,520 --> 00:33:32,600 Speaker 1: rules and jel you know, I was thinking about why 752 00:33:32,680 --> 00:33:35,000 Speaker 1: it is that we're drawn to rules, and it's because 753 00:33:35,000 --> 00:33:37,120 Speaker 1: it's easy. It's easy to point to something that you 754 00:33:37,160 --> 00:33:38,960 Speaker 1: know you are allowed to do. It's either yes or no. 755 00:33:39,000 --> 00:33:41,680 Speaker 1: It's binary rights, yes or no, black or white, correct 756 00:33:41,800 --> 00:33:45,240 Speaker 1: or incorrect. Uh, And folks don't like landing in that 757 00:33:45,320 --> 00:33:48,440 Speaker 1: in between no man's land, the shades of the land 758 00:33:48,440 --> 00:33:51,240 Speaker 1: of nuance and that's what we try to do honestly 759 00:33:51,280 --> 00:33:54,280 Speaker 1: with our show overall, but specifically with this episode where 760 00:33:54,280 --> 00:33:58,200 Speaker 1: we're kind of diving into the additional questions that should 761 00:33:58,200 --> 00:34:00,280 Speaker 1: come after you hear one of these rule is where 762 00:34:00,280 --> 00:34:02,880 Speaker 1: it's just like, well, maybe like you should also consider 763 00:34:02,960 --> 00:34:05,360 Speaker 1: this in this there are other ways to accomplish these 764 00:34:05,400 --> 00:34:07,720 Speaker 1: goals that we're trained to achieve. Yeah, and let's be 765 00:34:07,720 --> 00:34:10,520 Speaker 1: honest to the people that the voices they get amplified 766 00:34:10,520 --> 00:34:12,439 Speaker 1: the most in our culture are the black and white 767 00:34:12,520 --> 00:34:15,520 Speaker 1: lest they are the most extremes. Um. Really in the 768 00:34:15,560 --> 00:34:18,000 Speaker 1: world of politics, in the world of money, like you're 769 00:34:18,000 --> 00:34:21,960 Speaker 1: gonna take it, there they are. And so the people 770 00:34:22,040 --> 00:34:24,400 Speaker 1: that we hear from you you feel you're almost like 771 00:34:24,440 --> 00:34:27,160 Speaker 1: forced into one of these two camps. Um. But really, 772 00:34:27,480 --> 00:34:30,680 Speaker 1: when you look at even like political statistics, most Americans 773 00:34:30,719 --> 00:34:34,960 Speaker 1: identify as independents, Like they don't identify as being fully 774 00:34:35,000 --> 00:34:37,520 Speaker 1: with one party or the other. They don't identify on 775 00:34:37,560 --> 00:34:39,560 Speaker 1: the extremes. And I think in money it's the same. 776 00:34:39,600 --> 00:34:41,400 Speaker 1: It's the same way. There are a lot of people 777 00:34:41,400 --> 00:34:44,360 Speaker 1: who hear maybe the more stringent types are the really 778 00:34:44,400 --> 00:34:47,919 Speaker 1: incredibly loose liberal types with money, and they're like, I don't. 779 00:34:48,000 --> 00:34:50,600 Speaker 1: I don't know, man, Neither of those really fits me. 780 00:34:51,080 --> 00:34:54,160 Speaker 1: And so while we might not be the most amplified voices, 781 00:34:54,280 --> 00:34:56,839 Speaker 1: like we're going to use our platforms to say no, 782 00:34:56,840 --> 00:34:58,840 Speaker 1: no, no no, there is a gray area here. Some of 783 00:34:58,840 --> 00:35:00,640 Speaker 1: these rules are made to be broken, but you still 784 00:35:00,640 --> 00:35:02,359 Speaker 1: need to be smart with your money. That's right. We're 785 00:35:02,360 --> 00:35:05,960 Speaker 1: bringing that moderate, nuanced conversation to personal finance to money. 786 00:35:05,960 --> 00:35:09,720 Speaker 1: Hopefully we'll see a trickle down effect. That's another political reference, 787 00:35:09,840 --> 00:35:13,719 Speaker 1: like the Rossbaro of personal finance. Alright, let's talk about 788 00:35:13,760 --> 00:35:16,080 Speaker 1: some classic spending rules that you offer for our gen 789 00:35:16,160 --> 00:35:19,920 Speaker 1: Z listeners. I don't think they know what. Maybe link 790 00:35:20,000 --> 00:35:22,880 Speaker 1: to like his Wikipedia page in our show notes. Uh, 791 00:35:22,920 --> 00:35:25,080 Speaker 1: but we wanted to talk about some different spending rules 792 00:35:25,280 --> 00:35:28,200 Speaker 1: that we often hear about and the personal finance realm, 793 00:35:28,440 --> 00:35:30,440 Speaker 1: and we're gonna bust up some of these rules. The 794 00:35:30,440 --> 00:35:32,680 Speaker 1: first one we're gonna tackle is that you must have 795 00:35:32,800 --> 00:35:35,719 Speaker 1: a budget. Now, of course, I specifically I am a 796 00:35:35,800 --> 00:35:38,520 Speaker 1: huge fan of budgets, but that doesn't mean that everyone 797 00:35:39,200 --> 00:35:42,239 Speaker 1: must have one. Most folks, I know what pains you 798 00:35:42,280 --> 00:35:44,160 Speaker 1: even to say that. Okay, so it really does pain 799 00:35:44,239 --> 00:35:46,680 Speaker 1: me to say that because I kind of feel that 800 00:35:46,760 --> 00:35:50,320 Speaker 1: anybody would benefit from a budget because someone who's maybe 801 00:35:50,560 --> 00:35:53,799 Speaker 1: an oversaver, they're incredibly frugal, Well, it could free them 802 00:35:53,880 --> 00:35:56,520 Speaker 1: up to spend a little bit more, a little more freely, 803 00:35:56,800 --> 00:35:59,359 Speaker 1: with a little more intention. And somebody who is an 804 00:35:59,400 --> 00:36:01,359 Speaker 1: overspender they don't have, you know, they've got a lot 805 00:36:01,400 --> 00:36:03,719 Speaker 1: more month than they do money. I think if they 806 00:36:03,719 --> 00:36:05,200 Speaker 1: were to budget, then they're going to be able to 807 00:36:05,239 --> 00:36:07,759 Speaker 1: maybe achieve some of those financial goals. And I think 808 00:36:07,800 --> 00:36:09,920 Speaker 1: that's for the overwhelming majority of folks, But I do 809 00:36:09,960 --> 00:36:12,359 Speaker 1: think that there are some naturally frugal folks who don't 810 00:36:12,400 --> 00:36:15,560 Speaker 1: necessarily have to be beholden to a budget. Uh. And 811 00:36:15,600 --> 00:36:17,920 Speaker 1: so if there's someone out there who's investing a healthy, 812 00:36:17,960 --> 00:36:22,200 Speaker 1: good chunk of money in their retirement accounts automatically, maybe 813 00:36:22,239 --> 00:36:24,480 Speaker 1: you've got a healthy savings account, maybe you're naturally averse 814 00:36:24,560 --> 00:36:28,080 Speaker 1: to spending uh an overwhelming amount of money, well you 815 00:36:28,120 --> 00:36:30,279 Speaker 1: might fit into that category of a person who can 816 00:36:30,320 --> 00:36:32,880 Speaker 1: stop budgeting. Especially I think if you find it to 817 00:36:32,880 --> 00:36:35,880 Speaker 1: be a painful process and instead you're able to just 818 00:36:36,040 --> 00:36:38,480 Speaker 1: naturally achieve the goals that you're trying to achieve, your 819 00:36:38,560 --> 00:36:42,439 Speaker 1: naturally able to spend with a plan without a written plan, 820 00:36:42,600 --> 00:36:44,560 Speaker 1: then I think that's the kind of person who doesn't 821 00:36:44,680 --> 00:36:46,960 Speaker 1: have to have a budget. But again that being said, 822 00:36:46,760 --> 00:36:48,919 Speaker 1: I I do think that I think most folks could 823 00:36:48,960 --> 00:36:51,560 Speaker 1: benefit one way or the other from having a written budget. Yeah, 824 00:36:51,560 --> 00:36:53,440 Speaker 1: and it is a rule that can be broken, but 825 00:36:53,560 --> 00:36:55,760 Speaker 1: it's I agree, Matt, I think it is a helpful 826 00:36:55,760 --> 00:36:58,080 Speaker 1: tool for most people. I was listening to Front of 827 00:36:58,120 --> 00:37:00,560 Speaker 1: the Show Daniel Crosby talking about budget re cently, and 828 00:37:00,600 --> 00:37:02,680 Speaker 1: he's one of those guys who's like, I can't do it, 829 00:37:02,880 --> 00:37:05,440 Speaker 1: and it just I hate it, and so I'm not 830 00:37:05,480 --> 00:37:07,839 Speaker 1: going to. And he can afford not to because he's 831 00:37:07,880 --> 00:37:10,359 Speaker 1: done really good things with his money over a long 832 00:37:10,480 --> 00:37:12,600 Speaker 1: enough period of time that he doesn't he doesn't have 833 00:37:12,640 --> 00:37:15,520 Speaker 1: to pigeonhold himself into the classic budgeting trope that he 834 00:37:15,560 --> 00:37:17,439 Speaker 1: has to has to have one of those in his life. 835 00:37:17,760 --> 00:37:20,680 Speaker 1: And so, you know, I appreciate that I used to 836 00:37:20,800 --> 00:37:22,680 Speaker 1: roll without a budget until I got married and then 837 00:37:22,680 --> 00:37:25,320 Speaker 1: it was like, actually it's a necessary communication tool for 838 00:37:25,360 --> 00:37:27,480 Speaker 1: my wife and I. But it is one of those 839 00:37:27,480 --> 00:37:30,560 Speaker 1: things where I agree it is a rule that people 840 00:37:31,040 --> 00:37:33,200 Speaker 1: feel like, even if they're really really good with money, 841 00:37:33,200 --> 00:37:35,040 Speaker 1: that they have to do and we think there are 842 00:37:35,040 --> 00:37:37,200 Speaker 1: ways that you can make budgeting less miserable to We've 843 00:37:37,200 --> 00:37:39,680 Speaker 1: talked about that before and we will continue to talk 844 00:37:39,680 --> 00:37:42,520 Speaker 1: about why budgeting does not have to be an awful 845 00:37:42,520 --> 00:37:44,680 Speaker 1: thing in your life. But also know that it is 846 00:37:44,680 --> 00:37:46,560 Speaker 1: not a requirement to be a part of the personal 847 00:37:46,600 --> 00:37:50,200 Speaker 1: finance And another spending role that that constantly gets thrust 848 00:37:50,280 --> 00:37:52,719 Speaker 1: at people is that they should always beginning a deal. 849 00:37:53,160 --> 00:37:54,799 Speaker 1: This used to be me too, write like I've talked 850 00:37:54,800 --> 00:37:57,080 Speaker 1: about this on the show, that paying full price was 851 00:37:57,160 --> 00:37:59,640 Speaker 1: kind of anathema to who I was. Like it was, 852 00:38:00,200 --> 00:38:02,080 Speaker 1: I was like, there's there's no way I could ever 853 00:38:02,120 --> 00:38:06,160 Speaker 1: pay full price for anything, And yeah, I took deal 854 00:38:06,239 --> 00:38:09,360 Speaker 1: hunting to the extreme. I still personally prefer not to 855 00:38:09,360 --> 00:38:11,719 Speaker 1: pay full price for something, Like I I hear some 856 00:38:11,760 --> 00:38:14,080 Speaker 1: people in the personal financi world say I only pay 857 00:38:14,160 --> 00:38:16,959 Speaker 1: full price for things because it helps me not fall 858 00:38:17,000 --> 00:38:20,480 Speaker 1: prey to this lifestyle of like deal hunting. Um, and 859 00:38:20,520 --> 00:38:22,560 Speaker 1: I get that, I understand it, But I feel like 860 00:38:22,600 --> 00:38:24,680 Speaker 1: I've been able to realize the error of my deal 861 00:38:24,719 --> 00:38:28,320 Speaker 1: obsessed ways and like not not do as much deal 862 00:38:28,400 --> 00:38:31,399 Speaker 1: hunting and I actually keeping it to a minimum because yeah, 863 00:38:31,400 --> 00:38:35,480 Speaker 1: really the best deal isn't off. It is getting something 864 00:38:35,520 --> 00:38:37,040 Speaker 1: in a hundred percent off by not getting that thing 865 00:38:37,040 --> 00:38:39,640 Speaker 1: at all, if I'm by avoiding it altogether. And like, 866 00:38:39,719 --> 00:38:42,600 Speaker 1: you only get that when you stop shopping. When you 867 00:38:42,600 --> 00:38:46,120 Speaker 1: shop lass, buying fewer, nicer things also can lead to 868 00:38:46,160 --> 00:38:48,360 Speaker 1: more enjoyment of those things. I've realized that too, is 869 00:38:48,360 --> 00:38:51,680 Speaker 1: that I just had more things, too many things, and clutter. Uh. 870 00:38:51,719 --> 00:38:53,839 Speaker 1: And yeah, so if you're you're living by the rule 871 00:38:53,920 --> 00:38:57,120 Speaker 1: the big discounts are king, then you will likely need 872 00:38:57,160 --> 00:38:59,680 Speaker 1: to kick that one to the curb because it's probably 873 00:38:59,719 --> 00:39:01,520 Speaker 1: hurting more than it's helping you. If you want, we 874 00:39:01,520 --> 00:39:03,000 Speaker 1: can set up some sort of accountability and I can 875 00:39:03,000 --> 00:39:05,440 Speaker 1: see how often you're actually visiting slick deals or or 876 00:39:05,520 --> 00:39:08,120 Speaker 1: deal news. Let's do it. If you want me to 877 00:39:08,160 --> 00:39:12,600 Speaker 1: really hold you accountable. Uh, let's talk about splurges. Man. Uh. 878 00:39:12,640 --> 00:39:14,880 Speaker 1: There's this rule out there that if you're in debt, 879 00:39:14,920 --> 00:39:18,040 Speaker 1: you have to stop spending on anything that you enjoy. 880 00:39:18,160 --> 00:39:21,440 Speaker 1: And again, let's let's go ahead and side with that 881 00:39:21,520 --> 00:39:24,279 Speaker 1: rule here for a second. Debt is not ideal. We 882 00:39:24,320 --> 00:39:26,680 Speaker 1: do encourage how the money listeners to create a plan 883 00:39:26,960 --> 00:39:29,200 Speaker 1: to attempt to pay down their debt quickly. You know, 884 00:39:29,200 --> 00:39:32,640 Speaker 1: whether it's the snowball or the avalanche approach, we want 885 00:39:32,680 --> 00:39:34,200 Speaker 1: you to the middle of the road approach that we love, 886 00:39:34,280 --> 00:39:37,120 Speaker 1: oh yeah, both and approach. We want you to choose 887 00:39:37,360 --> 00:39:40,120 Speaker 1: just the approach that's gonna help you to get there faster. Uh. 888 00:39:40,160 --> 00:39:42,080 Speaker 1: And one of the reasons for that is because debt 889 00:39:42,080 --> 00:39:44,759 Speaker 1: actually makes us dumber. We've talked about the studies that 890 00:39:44,800 --> 00:39:47,800 Speaker 1: show that the stress that debt causes to our bodies 891 00:39:48,400 --> 00:39:50,680 Speaker 1: has an impact on our i Q. It's something like 892 00:39:50,719 --> 00:39:52,920 Speaker 1: twelve by que points that you lose when you're you know, 893 00:39:53,040 --> 00:39:55,520 Speaker 1: overwhelmed with that exactly. So the quicker that you're done 894 00:39:55,520 --> 00:39:57,279 Speaker 1: with that, the better off that you're going to be 895 00:39:57,280 --> 00:39:59,560 Speaker 1: from a mental health perspective. And so that means getting 896 00:39:59,640 --> 00:40:01,480 Speaker 1: rid of it QUI. That should be a top priority. 897 00:40:01,640 --> 00:40:04,560 Speaker 1: But if it took you years to get into that 898 00:40:04,680 --> 00:40:07,480 Speaker 1: debt conundrum in the first place, it will likely take 899 00:40:07,520 --> 00:40:09,799 Speaker 1: you years to get out of it. And it is 900 00:40:09,880 --> 00:40:15,080 Speaker 1: hard to live an austere monastic existence for years and years. 901 00:40:15,520 --> 00:40:17,799 Speaker 1: And so make sure that you still include a few 902 00:40:17,840 --> 00:40:21,239 Speaker 1: important spending items within your budget so that you don't 903 00:40:21,320 --> 00:40:24,879 Speaker 1: get burned out while you're pursuing debt elimination, you still 904 00:40:24,880 --> 00:40:27,399 Speaker 1: want to have those craft beer equivalents in your life, uh, 905 00:40:27,400 --> 00:40:29,680 Speaker 1: to kind of carry you over from day to day, 906 00:40:29,719 --> 00:40:31,879 Speaker 1: from week to week, whatever it is that you're gonna 907 00:40:31,880 --> 00:40:34,560 Speaker 1: splurge on just a little bit. Uh. And you can 908 00:40:34,600 --> 00:40:36,799 Speaker 1: even kind of set those up as little rewards. Maybe 909 00:40:36,800 --> 00:40:39,080 Speaker 1: as you're chiseling away or as you're chipping away at 910 00:40:39,120 --> 00:40:41,640 Speaker 1: your debt, you can have these little rewards that spur 911 00:40:41,800 --> 00:40:44,239 Speaker 1: you on to achieve your goal even faster, no doubt, man. 912 00:40:44,280 --> 00:40:46,400 Speaker 1: All right, yeah, and there are also some uh you 913 00:40:46,520 --> 00:40:48,960 Speaker 1: talked about spending rules. Let's talk about some well defined 914 00:40:49,040 --> 00:40:52,000 Speaker 1: rules in the arena of earning more money and that 915 00:40:52,040 --> 00:40:54,800 Speaker 1: we that we really kind of take as stock or standard. 916 00:40:55,080 --> 00:40:58,200 Speaker 1: But there's room for pushback on these rules too. And 917 00:40:58,360 --> 00:41:00,399 Speaker 1: I think, Matt, one of the biggest rule was out 918 00:41:00,440 --> 00:41:02,799 Speaker 1: there is that you need to go to college in 919 00:41:02,840 --> 00:41:05,560 Speaker 1: order to get a high paying job. And pretty classic rule. 920 00:41:05,680 --> 00:41:07,680 Speaker 1: And that is a classic rule, right, parents told me 921 00:41:07,920 --> 00:41:11,200 Speaker 1: definitely fed me that rule like my entire I mean, 922 00:41:11,200 --> 00:41:12,520 Speaker 1: I think ever since I was a kid, I don't 923 00:41:12,520 --> 00:41:14,759 Speaker 1: think I knew there were alternatives to go into college. No, 924 00:41:14,880 --> 00:41:17,239 Speaker 1: it was I mean basically, Okay, so I will say 925 00:41:17,640 --> 00:41:19,640 Speaker 1: my dad. We did have a conversation I think when 926 00:41:19,680 --> 00:41:21,320 Speaker 1: I was like a sophomore or something like that in 927 00:41:21,400 --> 00:41:23,319 Speaker 1: high school, and he's just like, you know, you don't 928 00:41:23,360 --> 00:41:26,120 Speaker 1: have to go to college. But mom would be devastated. 929 00:41:27,520 --> 00:41:29,600 Speaker 1: She would stop loving it. And You're like, I guess 930 00:41:29,600 --> 00:41:31,040 Speaker 1: I'll do. You totally put that out there, and I 931 00:41:31,040 --> 00:41:33,360 Speaker 1: was just like, okay, well, I mean college sounds school. 932 00:41:33,400 --> 00:41:35,640 Speaker 1: You know, you see movies about college. I was kind 933 00:41:35,640 --> 00:41:37,160 Speaker 1: of I think more into it, like more into it 934 00:41:37,200 --> 00:41:39,200 Speaker 1: from like a lifestyle standpoint. It's just like, yeah, that's 935 00:41:39,200 --> 00:41:40,960 Speaker 1: just what all my friends are doing. I didn't have 936 00:41:40,960 --> 00:41:43,040 Speaker 1: a whole lot of drive. I would say that's the 937 00:41:43,080 --> 00:41:45,120 Speaker 1: high school. I'm like, everybody else is doing it. I'll 938 00:41:45,120 --> 00:41:47,719 Speaker 1: do it too. You're the fault of the crowd kind 939 00:41:47,719 --> 00:41:50,960 Speaker 1: of guy. What definitely was then, Well, yeah, like that 940 00:41:51,200 --> 00:41:53,880 Speaker 1: the last decade though, really, since we went to college, 941 00:41:54,360 --> 00:41:57,080 Speaker 1: we've kind of seen this rule disintegrate before our very eyes, 942 00:41:57,120 --> 00:42:02,240 Speaker 1: like the reality that getting a college degree automatically equates 943 00:42:02,239 --> 00:42:04,400 Speaker 1: to a high paying job. It's not the case like 944 00:42:04,440 --> 00:42:06,080 Speaker 1: it used to be. And it's not like getting an 945 00:42:06,000 --> 00:42:08,080 Speaker 1: advanced degree doesn't still work out for lots of folks, 946 00:42:08,200 --> 00:42:10,440 Speaker 1: but it's just the value proposition has changed in a 947 00:42:10,440 --> 00:42:12,560 Speaker 1: big way. It's not a slam dunk um like it 948 00:42:12,640 --> 00:42:15,279 Speaker 1: was when we were younger, and in particular our parents. 949 00:42:15,280 --> 00:42:19,120 Speaker 1: Generation to right and COVID has likely hurt that value 950 00:42:19,120 --> 00:42:22,680 Speaker 1: proposition even more. Like you might not be getting the 951 00:42:22,800 --> 00:42:25,560 Speaker 1: same experience on a college campus these days, and in 952 00:42:25,640 --> 00:42:28,240 Speaker 1: all likelihood you're not. And so yeah, it's more important 953 00:42:28,239 --> 00:42:30,080 Speaker 1: than ever to do the math yourself and to run 954 00:42:30,120 --> 00:42:33,800 Speaker 1: the numbers with your kids before blindly believing that college 955 00:42:34,040 --> 00:42:36,480 Speaker 1: is the essential move and that it of course it 956 00:42:36,520 --> 00:42:38,799 Speaker 1: makes sense, um, And it's core the decision to go 957 00:42:38,880 --> 00:42:42,239 Speaker 1: to college or not is an investment decision. And not 958 00:42:42,360 --> 00:42:45,239 Speaker 1: that there aren't lifestyle benefits right to going um, But 959 00:42:45,320 --> 00:42:49,720 Speaker 1: if it means inundating your kids or yourself with copious 960 00:42:49,719 --> 00:42:51,919 Speaker 1: amounts of debt that you can never pay off, then 961 00:42:52,200 --> 00:42:54,360 Speaker 1: it's not worth even that social experience that you were 962 00:42:54,360 --> 00:42:56,200 Speaker 1: able to gather. You can get that in other ways. Uh. 963 00:42:56,239 --> 00:42:58,680 Speaker 1: And it's also important to remember that blue collar jobs 964 00:42:58,680 --> 00:43:01,200 Speaker 1: are seeing a revival right now. They're seeing higher amounts 965 00:43:01,200 --> 00:43:04,959 Speaker 1: of pay and rightly so, because we haven't incentivized people 966 00:43:05,000 --> 00:43:07,480 Speaker 1: to go in that direction. We talked about more about 967 00:43:07,480 --> 00:43:10,959 Speaker 1: that in episode two seventy seven with Ken Rusk, and so, yeah, 968 00:43:11,000 --> 00:43:14,480 Speaker 1: if you kind of feel inclined towards working with your 969 00:43:14,480 --> 00:43:18,600 Speaker 1: hands anyway or being entrepreneurial, don't assume that you have 970 00:43:18,680 --> 00:43:20,640 Speaker 1: to go to college. I mean, we still think it's 971 00:43:20,640 --> 00:43:22,759 Speaker 1: a great idea for a lot of people. And even 972 00:43:22,840 --> 00:43:25,160 Speaker 1: in that decision, you would be really smart. So you're 973 00:43:25,160 --> 00:43:27,239 Speaker 1: getting a degree that's gonna pay off for you and 974 00:43:27,280 --> 00:43:29,000 Speaker 1: so that you're not taking on more death than you're 975 00:43:29,000 --> 00:43:31,200 Speaker 1: gonna be able to handle. But yeah, that rule that 976 00:43:31,280 --> 00:43:34,800 Speaker 1: says college equals great job just doesn't hold water the 977 00:43:34,840 --> 00:43:36,959 Speaker 1: way it used to. That's right, man. It'll be really 978 00:43:37,120 --> 00:43:39,960 Speaker 1: interesting to see where things are when our oldest kids 979 00:43:40,000 --> 00:43:42,200 Speaker 1: start going to college, to see if it's see if 980 00:43:42,320 --> 00:43:44,040 Speaker 1: things shift honestly between now and then, or if they 981 00:43:44,080 --> 00:43:46,480 Speaker 1: kind of continue um at the rate that they've been. 982 00:43:46,960 --> 00:43:48,560 Speaker 1: We're talking about earning money and so what kind of 983 00:43:48,560 --> 00:43:51,080 Speaker 1: While we're on that note, let's talk about replacement of income. 984 00:43:51,480 --> 00:43:54,480 Speaker 1: Let's talk about life insurance. Uh, And the rule that 985 00:43:54,520 --> 00:43:56,960 Speaker 1: you'll often hear when you're shopping around for life insurance 986 00:43:57,160 --> 00:43:58,839 Speaker 1: is that you need to have a policy that can 987 00:43:58,880 --> 00:44:01,600 Speaker 1: cover ten time is your income which you know, that's 988 00:44:01,640 --> 00:44:04,440 Speaker 1: not a bad rule, but it certainly is not one 989 00:44:04,520 --> 00:44:07,040 Speaker 1: that you have to follow. Joe and I, we actually 990 00:44:07,080 --> 00:44:10,239 Speaker 1: both just got new policies, new life insurance policies. H 991 00:44:10,320 --> 00:44:14,080 Speaker 1: And many insurance salespeople they're gonna kind of frown when 992 00:44:14,080 --> 00:44:16,719 Speaker 1: you don't have a policy that's ten x your annual income. Yeah, 993 00:44:16,760 --> 00:44:18,440 Speaker 1: they will try to convince you. Yeah, they will. I 994 00:44:18,440 --> 00:44:20,360 Speaker 1: mean it's in their best interest to kind of upsell 995 00:44:20,400 --> 00:44:22,480 Speaker 1: you a little bit. But there are other factors that 996 00:44:22,520 --> 00:44:25,880 Speaker 1: you can take into accounts, things like other sources of income. 997 00:44:26,120 --> 00:44:28,040 Speaker 1: That's real estate for you and me, Joe. Also, how 998 00:44:28,080 --> 00:44:31,319 Speaker 1: close are you are to actually achieving financial independence? Uh, 999 00:44:31,400 --> 00:44:33,440 Speaker 1: some of the different responsibilities that you have, depending on 1000 00:44:33,480 --> 00:44:35,839 Speaker 1: the number of kids you have, the different liabilities, these 1001 00:44:35,880 --> 00:44:37,360 Speaker 1: are all things that you want to keep in mind. 1002 00:44:37,719 --> 00:44:39,719 Speaker 1: Not You don't just want to blindly follow the rule 1003 00:44:39,800 --> 00:44:42,120 Speaker 1: of oh, you must have ten x your current income. 1004 00:44:42,520 --> 00:44:45,400 Speaker 1: And so if you're further along that road, say towards 1005 00:44:45,440 --> 00:44:48,640 Speaker 1: financial independence, you know there's no necessity to stick hard 1006 00:44:48,840 --> 00:44:51,480 Speaker 1: to this ten next income rule. And also just remember 1007 00:44:51,520 --> 00:44:54,680 Speaker 1: to having some life insurance coverage is better than just 1008 00:44:54,719 --> 00:44:57,920 Speaker 1: not having anything at all. Yeah, And when I think 1009 00:44:57,960 --> 00:44:59,480 Speaker 1: sometimes people hear the ten X and they get the 1010 00:44:59,480 --> 00:45:01,640 Speaker 1: price quotes and they're like, oh, that's it's gonna be 1011 00:45:01,680 --> 00:45:03,360 Speaker 1: a bigger chunk of my monthly budget than I wanted 1012 00:45:03,360 --> 00:45:05,440 Speaker 1: it to be, and so they settle for, you know, 1013 00:45:05,480 --> 00:45:08,640 Speaker 1: a smaller policy. And I think having something, you can 1014 00:45:08,680 --> 00:45:10,960 Speaker 1: always get another policy down the road, and you can 1015 00:45:11,000 --> 00:45:14,080 Speaker 1: do what's called laddering, right, And so if you're turned 1016 00:45:14,080 --> 00:45:17,440 Speaker 1: away by the price, although term life insurance incredibly cheap, like, 1017 00:45:17,960 --> 00:45:20,240 Speaker 1: hopefully you're not turned away by the price because because 1018 00:45:20,239 --> 00:45:24,000 Speaker 1: it really shouldn't be too terribly expensive. But but you 1019 00:45:24,080 --> 00:45:25,960 Speaker 1: might say, you know what, I'm gonna get half as 1020 00:45:26,040 --> 00:45:28,799 Speaker 1: much as the life insurance industry says I should get, 1021 00:45:29,000 --> 00:45:31,239 Speaker 1: and I will have some coverage at least, because you're right, 1022 00:45:31,360 --> 00:45:35,600 Speaker 1: something is better than nothing. But yeah, it rules, Matt, infummation. 1023 00:45:35,680 --> 00:45:38,160 Speaker 1: Rules can be great and and you're right, they often 1024 00:45:38,200 --> 00:45:40,480 Speaker 1: help point us in the right direction. Without rules, we 1025 00:45:40,520 --> 00:45:43,560 Speaker 1: can be lost and breaking rules without giving any thought 1026 00:45:43,600 --> 00:45:46,120 Speaker 1: as to why you're doing so. Uh, it's really it's 1027 00:45:46,160 --> 00:45:49,640 Speaker 1: more of a recipe for some catastrophic mistakes. And uh, yeah, 1028 00:45:49,640 --> 00:45:51,600 Speaker 1: but I think there's like the letter of the law, 1029 00:45:51,760 --> 00:45:53,719 Speaker 1: and then there's the spirit of the law, Matt Right. 1030 00:45:53,920 --> 00:45:56,680 Speaker 1: For instance, going back to that speed limit example, most 1031 00:45:56,760 --> 00:45:59,040 Speaker 1: policemen are not supposed to pull you over unless you're 1032 00:45:59,080 --> 00:46:01,600 Speaker 1: going ten miles over the speed limit. Right. Uh, it 1033 00:46:01,719 --> 00:46:03,960 Speaker 1: is this limit that you're supposed to adhere to, But 1034 00:46:04,040 --> 00:46:07,000 Speaker 1: there's a grace range for you even in that. Uh. 1035 00:46:07,040 --> 00:46:10,200 Speaker 1: And yeah, and also there's something to be said for 1036 00:46:10,440 --> 00:46:13,080 Speaker 1: driving with the flow of traffic. And as you grow 1037 00:46:13,160 --> 00:46:15,919 Speaker 1: in your financial education, you're likely going to find other 1038 00:46:15,960 --> 00:46:17,719 Speaker 1: points in time where you can bend or break a 1039 00:46:17,800 --> 00:46:21,880 Speaker 1: rule that you've heard because your specific situation really it 1040 00:46:21,960 --> 00:46:24,319 Speaker 1: needs a different tactic. And so it's important to know 1041 00:46:24,360 --> 00:46:26,759 Speaker 1: the fundamentals before you start improvising, right, Like a like 1042 00:46:26,800 --> 00:46:29,560 Speaker 1: a jazz musician, before they can get crazy with with 1043 00:46:29,600 --> 00:46:31,600 Speaker 1: their music, they have to know their scales and they 1044 00:46:31,640 --> 00:46:33,759 Speaker 1: have to know them really well. But knowing that it's 1045 00:46:33,760 --> 00:46:35,279 Speaker 1: okay to break some of these rules, I think it 1046 00:46:35,320 --> 00:46:38,759 Speaker 1: can be freeing to And so yeah, our advice to 1047 00:46:38,840 --> 00:46:40,960 Speaker 1: you guys just to go break some of these rules, 1048 00:46:41,000 --> 00:46:43,920 Speaker 1: like don't don't go haywire. But but some of these 1049 00:46:44,000 --> 00:46:47,959 Speaker 1: rules really, um, they're helpful to know, but then they're 1050 00:46:48,000 --> 00:46:50,960 Speaker 1: they're not meant to be followed blindly. That's right, man, 1051 00:46:51,040 --> 00:46:52,480 Speaker 1: Let's go ahead and get back to the beer that 1052 00:46:52,520 --> 00:46:54,520 Speaker 1: you and I enjoyed on this episode, which was called 1053 00:46:54,960 --> 00:46:59,320 Speaker 1: Indefinite Staycation, and this was a barrel aged fruited sour 1054 00:46:59,360 --> 00:47:03,080 Speaker 1: ale by dog fish Head. Before we talk about the beer, 1055 00:47:03,239 --> 00:47:05,920 Speaker 1: hold this bottle. Did you realize how heavy this thing is? 1056 00:47:05,960 --> 00:47:09,320 Speaker 1: That is not a normal weighted glass bottle? And I 1057 00:47:09,360 --> 00:47:12,080 Speaker 1: guess it's because since this was one that was I 1058 00:47:12,080 --> 00:47:15,080 Speaker 1: assume bottle conditioned. Uh, and it was corked and caged. 1059 00:47:15,480 --> 00:47:17,839 Speaker 1: There may be worried about the pressure. I don't know, 1060 00:47:17,960 --> 00:47:20,720 Speaker 1: but it is like twice as thick as a normal bottle. 1061 00:47:20,960 --> 00:47:22,560 Speaker 1: It's just a little guy, but he's got weight that's 1062 00:47:22,560 --> 00:47:25,080 Speaker 1: at least twice the size of what it looks like 1063 00:47:25,080 --> 00:47:26,600 Speaker 1: it should be. I just kind of caught me off 1064 00:47:26,600 --> 00:47:28,600 Speaker 1: guard here when I picked it up. But what were 1065 00:47:28,600 --> 00:47:30,680 Speaker 1: your thoughts on this actual beer? First? I like the name, 1066 00:47:30,719 --> 00:47:33,160 Speaker 1: except for it feels like indefinite stacation, feels like our 1067 00:47:33,200 --> 00:47:36,080 Speaker 1: lives That is not right now. Yeah, I want indefinite 1068 00:47:36,160 --> 00:47:39,400 Speaker 1: vacation now. But yeah, I think this this beer was 1069 00:47:39,920 --> 00:47:41,759 Speaker 1: worth the two year white that it took to make 1070 00:47:41,760 --> 00:47:44,480 Speaker 1: this beer. This beer was aged for over two years 1071 00:47:44,640 --> 00:47:48,160 Speaker 1: in French oak and the it had I don't think 1072 00:47:48,200 --> 00:47:51,719 Speaker 1: we mentioned it had blackberries and wild main blueberries in 1073 00:47:51,800 --> 00:47:56,799 Speaker 1: this beer, and so it had just delicious levels of fruitiness, 1074 00:47:57,280 --> 00:48:01,320 Speaker 1: delicious levels of like oak presents a little bit of funkiness. 1075 00:48:01,719 --> 00:48:04,640 Speaker 1: I love fruited sours, and this one goes in like 1076 00:48:04,680 --> 00:48:06,840 Speaker 1: the pantheon of the greats of great fruited hours. I 1077 00:48:06,840 --> 00:48:08,919 Speaker 1: think it's it was really delicious. It was really good, dude. 1078 00:48:09,000 --> 00:48:11,399 Speaker 1: I agree. It was incredibly acidic. I feel like that's 1079 00:48:11,480 --> 00:48:13,080 Speaker 1: the first thing I noticed when I took a took 1080 00:48:13,120 --> 00:48:16,160 Speaker 1: my first sip, Like I noticed the acid, and then 1081 00:48:16,360 --> 00:48:18,200 Speaker 1: kind of and then right after that, I noticed like 1082 00:48:18,200 --> 00:48:20,120 Speaker 1: the wood notes you kind of have, like those like 1083 00:48:20,120 --> 00:48:22,640 Speaker 1: the sharp sour, and then it fades into the kind 1084 00:48:22,640 --> 00:48:25,279 Speaker 1: of the fruit sweetness going on. That sweetness really kind 1085 00:48:25,320 --> 00:48:27,120 Speaker 1: of broke through there, I feel like on the end um. 1086 00:48:27,239 --> 00:48:29,359 Speaker 1: And you know, earlier I was telling you the story 1087 00:48:29,360 --> 00:48:31,359 Speaker 1: about how Kit and I went we went hiking. Well, 1088 00:48:31,440 --> 00:48:34,040 Speaker 1: during one of our hikes, we actually like near you know, 1089 00:48:34,080 --> 00:48:36,120 Speaker 1: at the top of like near Mount Mitchell, we came 1090 00:48:36,160 --> 00:48:39,000 Speaker 1: across a bunch of wild blueberries and blackberries. I'm not 1091 00:48:39,040 --> 00:48:41,239 Speaker 1: even kidding, actually have a maybe I'll post another photo 1092 00:48:41,400 --> 00:48:44,040 Speaker 1: make your own beer. But well, here's the thing, Mount Mitchell. 1093 00:48:44,080 --> 00:48:47,640 Speaker 1: It's the highest peak east of the Mississippi. And so 1094 00:48:48,200 --> 00:48:49,920 Speaker 1: Kate was saying that she's pretty sure that these are 1095 00:48:49,920 --> 00:48:52,120 Speaker 1: the same kind of blueberries that grow wild in Maine. 1096 00:48:52,480 --> 00:48:54,480 Speaker 1: Uh and because it was at such a high elevation. 1097 00:48:55,080 --> 00:48:57,600 Speaker 1: Normally you don't see these blueberries in North Carolina, but 1098 00:48:57,719 --> 00:49:00,040 Speaker 1: where we were hiking, you do. And so I I 1099 00:49:00,120 --> 00:49:02,160 Speaker 1: feel like it came full circle. But yeah, this is 1100 00:49:02,200 --> 00:49:04,400 Speaker 1: a really great beer. And thanks again to Ryan for 1101 00:49:04,560 --> 00:49:07,360 Speaker 1: donating this one to the show. Yeah, thanks Ryan, appreciate 1102 00:49:07,400 --> 00:49:09,279 Speaker 1: your man, and we appreciate doctors shed Man. They've been 1103 00:49:09,320 --> 00:49:12,080 Speaker 1: doing making good beer for decades now. So all right, 1104 00:49:12,080 --> 00:49:13,920 Speaker 1: that's gonna do it for this episode. For folks who 1105 00:49:13,920 --> 00:49:17,200 Speaker 1: want the show notes with any links, including that Ross 1106 00:49:17,200 --> 00:49:19,680 Speaker 1: Pero Wikipedia pagell we'll put that on there. For all 1107 00:49:19,680 --> 00:49:21,680 Speaker 1: you gen zeers who don't remember who he was, you 1108 00:49:21,680 --> 00:49:23,480 Speaker 1: can find those up on our website at how to 1109 00:49:23,520 --> 00:49:25,440 Speaker 1: money dot com. That's right, And if you have not 1110 00:49:25,560 --> 00:49:27,200 Speaker 1: subscribed to the show yet, we would love it if 1111 00:49:27,200 --> 00:49:29,600 Speaker 1: you mashed subscribe so you don't miss any future episodes. 1112 00:49:29,640 --> 00:49:31,919 Speaker 1: If you haven't left us a review yet, we would 1113 00:49:31,960 --> 00:49:35,400 Speaker 1: greatly appreciate that, especially over at Apple Podcast. And you 1114 00:49:35,400 --> 00:49:37,360 Speaker 1: can also take your grandma's phone and mash subscribe to 1115 00:49:37,600 --> 00:49:39,800 Speaker 1: she wants to hear us talk about craft beer. She 1116 00:49:39,840 --> 00:49:42,040 Speaker 1: does at the end of the episode. Joel, that's gonna 1117 00:49:42,040 --> 00:49:44,399 Speaker 1: be it for this episode until next time. Best Friends Out, 1118 00:49:44,440 --> 00:49:45,640 Speaker 1: Best Friends Out,