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ChooseFI | Financial Independence Podcast
Inherited Account Deep Dive, Barista FI and Saving When Starting a Business | Rachael Camp | Ep 534
00:57:56
This episode discusses financial independence strategies, including Barista FI and Coast FI, along with insights into inherited accounts post-Secure Act (2020). Listeners will learn about health insurance considerations in early retirement, the...
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- [00:00]
Brad
Hey, it's Brad. Before we get started with the episode, I wanted to pass along some incredibly exciting news in the Choose a Buy world. As we talked about on a previous episode, Jonathan has spent the last couple of years building something incredible and we actually just rolled it out. This is our brand new Choose a five member site. It's obviously entirely free to sign up for. We're hoping this will take the place of our Facebook groups, both for the main Facebook group and especially for our local groups. So how this is going to work, you just go to our main homepage, choosefi.com and and you will see front and center, register, sign up for an account log in. It's really, really easy. We made it as simple as possible. So right now, Jonathan is building this in public. Every single day he posts an update with the 20 or 30 things that he updated from the last day that people reported that, Hey, I want to see this. I'd love to see this new feature. How can we do this? This is the ultimate crowdsourced personal finance website and community. We finally built it. We've dreamed of this since 2017 and we finally have the technology. We are not beholden to Facebook anymore. We can actually send out events and you will get emailed notification of it. So it's not just the 1%. If you get lucky, that Facebook shows you the notification. Now for your local groups, when you sign up, you tag, hey, I'm a member of this local group. And when your admin sets up an event, you will get email notified so you can't possibly miss it.
- [01:22]
Rachel Camp
This.
- [01:22]
Brad
This is so exciting. We already have thousands upon thousands of people that signed up just in the first three days and I expect there to be tens of thousands before very long. So I wanted to jot this off before the episode started. Go to choose a5.com our main homepage and sign up for an account today. Hello and welcome to Choose a five. Today on the show, we have another fun mailbag episode with my good friend Rachel Camp, who's a CFP and has joined us now. This is the seventh mailbag episode we've done together, which is always fun, always illuminating. And she's picked some really interesting questions for us to go through and it's interesting how a lot of them actually tie together. So we talk about Barista Phi, a question that came in and can you pull out of your nest egg early? There's a an overview of Coastify Barista Phi, how those interact. And then we had a number of questions and comments come in about inherited accounts. And this is something we've really never touched on here on the podcast in almost 700 episodes. And we do a real deep dive for a mailbag episode on the conceptual understanding that you need to understand inherited accounts. And frankly, this is something that's going to be really important to a lot of us as parents age. And this is just the reality of life. So it's very important to know this. And finally, Ann wrote in with a question about how to save when you're in the early stages of entrepreneurship. And interestingly, we tie it back to that first question about Barista FI and Coastify. And it's funny how there's just this. This interaction in the FI world of all these new strategies. And I think that's what's a lot of fun about this. I think you're really going to enjoy this episode with that. Welcome to Choose Up Fi. Rachel, it is so good to see you. And Happy New Year. This. It's been a couple months since we've done mailbag, since I took my little mini retirement and. And trip, but this is gonna be fun.
- [03:19]
Rachel Camp
Yeah, I'm excited. Great to see you again too. I think we're on number seven, so we're rocking and rolling.
- [03:25]
Brad
Yeah. I genuinely love these mailbag episodes with you, so I'm so thankful that you continue to want to come back on. And it's just a fun time and I think it's really useful for the listener. I think people get a lot out of these because there are a lot of questions that come in and today is no exception. So, as usual, we have an ambitious plan, so we're gonna start out with something really fun. So David wrote in and said question for a future discussion topic. Can one start withdrawing from their nest egg before reaching fi? Most of the talk is about full fi or cos phi. If my annual expenses are $60,000, then I need $1.5 million for full fi, which is the 25x or for coast fi. If I have enough in my retirement accounts to grow to that $1.5 million over the long run, then I just need to make enough money to cover my current expenses, which in this case would be 60,000. However, I'm hoping you can discuss the following. Let's say I have $750,000 saved to date. Can I start withdrawing from my nest egg today? Say, the typical 3 to 4% withdrawal rate? So let's use $30,000 in this example. So that would be 4% withdrawal rate. If so, then I really only need to earn $30,000 at a job to cover the remainder of my expenses. So it would be the 30,000 being pulled from this 750,000 and it would be another 30,000 earned from whatever type of job. So he's saying earning 30,000 versus 60,000 is a big difference in this example in terms of pressure jobs you can choose from. And I think it would be fun for you to discuss whether you can start these withdrawals before you reach full fi. So, Rachel, this is a really great one. I'm glad you, you tagged this one. I'd love to hear you kick it off.
- [05:06]
Rachel Camp
Yeah, well, I was excited for this one because it's labeled as barista Phi is what I've heard. But I've never really dived into it because I've always. I've looked at Full Fire Coastify, which I am a huge fan of Coastify and the listener mentioned that as well. That just takes a lot of pressure off. Right. I've gotten to the point where I've saved enough. Now I just need to cover expenses and basically coast to retirement. The other one though, barista is where we actually are starting to pull from the accounts right away, but just supplementing your employment income. And I think it got the name Barista 5 because of a place like Starbucks where you could go work and get health insurance. Right. So when I look at these scenarios, one of the first things that always pops into my mind is, okay, what are we doing for health insurance? Because unfortunately, that is one of those things that actually make early retirement or barista fi more complicated because health insurance insurance can be really expensive. Now we could go into a deeper analysis around subsidies with the Affordable Care act and things like that, which it sounds like if you're making 30k, you actually might qualify for a decent amount of subsidies. But one of the alternatives, of course, is just getting that part time job that covers your health insurance. So that's where I've. I haven't actually seen this work out, but if not that, I've seen it fail, but I just have never seen barista fi in action before. I would imagine to me, some of the things I would think about if he's thinking through this process of is there anything I'm missing? Like, health insurance is probably the first thing that comes into my mind. And then we can dive deeper into actual math behind it too. Safe withdrawals, rates, things like that. But I want to kind of talk about why they call it barista fi in the first place.
- [06:48]
Brad
Yeah, I like that. So it's funny how many flavors of fi. There are. I mean, it's crazy, all these terms. I can barely keep up with them. But yeah, barista. That makes sense. It's like, all right, I don't need some high powered job. I can essentially do anything. I just need a little bit of income to cover whatever it is I need to live. And it's funny, Rachel, because I always thought it was actually just, hey, my expenses aren't that high. I didn't conceptualize that You're. You are pulling from your nesting. Which of course makes sense in that case, because otherwise. Otherwise it would just be Coast Phi. I think. So it's funny. And maybe, maybe you can define. I have a bunch of tangents, but why don't you define Coastify? I know David took a stab at it, but why don't you define it? Since you said that's something that's important to you.
- [07:34]
Rachel Camp
Yeah, important to me. And I work with a lot of clients where I really look for the point where we hit Coastify because I think it's such an exciting point. But basically it's the point where today you've. You've saved enough. Where your assets should grow. Given projections and assumptions we can use. They should grow enough between now and your retirement date that they will grow to that financial freedom number that you need to fully retire. So essentially, you've saved enough at this point. You actually don't need to put any more into savings or any more into investments because that account balance should carry you through to retirement and allow you to fully retire. Of course, that's assuming that your living expenses are staying stable, that we get the projections that we hope we do with investment returns, things like that. But there is a lot of good calculators out there for Coastify that you can look into. I think Wallet Verse is the one I use quite a bit.
- [08:30]
Brad
Okay.
- [08:30]
Rachel Camp
And they have a barista FI calculator as well, too, if you want to look into that one. But yeah, Coast Fi, you basically have hit the point where you've saved enough and now you can let your returns and your growth take care of the rest of the work for you until you hit full retirement age.
- [08:45]
Brad
Yeah, that makes perfect sense. And to illustrate this, it is very case specific and it's not implying by definition that it's even early retirement. Right. I think a lot of people get caught up in that. Like, I was just doing the math based on David saying. And of course what you said is so critical in there, Rachel, which is we're assuming that expenses don't change and you're getting an X return that you're expecting. But I just did a back of the envelope math on this. So if he spent 60,000 like he said, his PHI number is then 1,5 million. So it's just 60,000 times 25. Right. And let's say he doesn't want to retire early. He just wants to do this kind of coast phi thing and just coast on in and just earn enough in this case to cover his lifestyle. And this is, I'm trying to fill together a couple different points so you out there listening understand like just how compounding works as well. Because basically there's something called the rule of 72. And this is one of those things that's like, it's needlessly complicated in the fact that it's some rule or like if you try to understand it, it does. You don't have to understand it. It's just simple math. It's basically you take in this case what your expected annual return is and you take the number 72 and divide it by that expected annual return. So we in the FI community generally use 8%. It's a rough number. Nobody can guarantee you that that's going to happen. But you would just take 72 and divide by eight and that comes out to nine. Now that's the number of years it takes your money to double. Okay, So I just assumed, hey, let's say David is 30 years old and he's not in any kind of rush to retire. How much would he need if he wanted to retire 27 years from now? So he's 57, he's just doing his Coastify thing for the next 27 years. If he had $187,500 at 30 years old, that would then it'll double nine years later to 375,000. That three hundred and seventy five because that's the base, then will double again to 750, another nine years later, will double to 1.5 million, another nine years after that. So in a 27 year period where he has added zero dollars to his nest egg, it's just rocking and rolling in the background, growing and compounding and that turns from 187.5 to, to 1.5 million while all he has to do is cover his life expenses. So obviously nobody can guarantee the returns, all that yada yada yada stuff. Right? But it's really cool, Rachel, to see how that can work.
- [11:12]
Rachel Camp
Yeah, I mean basically if he's at 7:50 and he wants to get to 1 2.5 he's got nine years until he can get that to that number. The other part of this is, you know, we could talk about safe withdrawal rates a little bit. When you have a really long time horizon, we start to back off 4% a little bit more and, and bring it down to the closer to three and a half percent range. A lot of research out there in safe withdrawal rates beyond the 30 year time horizon. So that would be the other thing is if he's 30 years old and he's wanting to start drawing, 4% might be a little bit too aggressive given the time horizon. And we're talking about a really long retirement or time where you're pulling from your portfolio. So we might want to back off that withdrawal rate a little bit. But yeah, I mean, to me, my guess is he's already hit Coastify at this point. I can't remember if he said that, but if he's somewhere in that age range, he definitely should have hit it at that point. So he has the options of, okay, cover my living expenses, just get a job that covers 60k in income. Or, you know, he could do barista and cover something like he mentioned 30K. And then he can do something like go work at Starbucks, get the health insurance, draw from the portfolio. I would just make sure that we're doing it at a safer withdrawal rate than maybe 4% if he's really young.
- [12:27]
Brad
Okay, yeah, that makes sense. So I did just make up that he's 30. That was, that was my, my fictional thing. So I guess the heart of his question, and this is what I really want to drill down on, is can you start with drawing and still expect your net worth to grow? And I'm not sure exactly how to phrase this, Rachel, but, but hopefully you're, you're getting the point. So let's say he has 750,000, right? And yeah, he would expect it to double again to 1.5 nine years later. But if he's now doing this Barista 5 thing where he is 750, but he's pulling out, like you said, maybe three or three and a half or three and a quarter, something. We'll say three just because it's easier math. If he's pulling out 3% every year, unless I don't understand math, that's not going to double in nine years then, Right? So what's the interplay here of like, yeah, he's withdrawing. Does he then have to keep earning? Like, yeah, it's barista, but does he have to do that in perpetuity? Like into infinity, in essence.
- [13:31]
Rachel Camp
Yeah. I mean, if we look at this, like just looking at it in isolation, Right. Where the math is still the same, let's assume all of a sudden he actually only needed 30k to live off of, so math is still the same. He's. He's just going to draw. You know, I know we're using 4% here, but we'll just assume that that works. 4% off 750. And we could say, yeah, you're good, if that's all you need is 30k in income. Now, as a matter of, okay, if I'm going to do that, and then I do want to fully retire in nine years, not going to have any supplemental income, what will happen to your point? Yeah, obviously you're drawing from the portfolio. It's not going to do as well as if you were completely leaving alone to compound and grow. Can't say for sure. We can use some assumptions in there and the calculators have that built in as well if you want to put in that information. But. But also, nine years is kind of a tricky time horizon. Right. I mean, we've had a decade where the large cap OR S&P 500 has actually not returned anything. So we could have a really bad decade where your account actually doesn't grow, or we could have a great decade that even if you're pulling from the portfolio, it's still going to double. We've seen those decades as well. So nine years is a little tricky to say what's exactly going to happen. I would just say you have to be flexible and understand that if we're drawing a little bit. Yeah, that's going to be not as impactful as if you were leaving that portfolio alone, letting it compound and grow. But we can't say for certainty what's going to happen in nine years. He'll just have to be flexible with that result.
- [15:01]
Brad
Yeah. And I think that's a brilliant point. But, yeah, clearly just doing the math. Right. And that's so astute that obviously we can't know the future. Right. Like, we can't. And I think it's important, and I'm so glad you said that because it's easy to say, oh, we expect an 8% return. It's almost never going to be exactly 8%. So you could live for another hundred years and it will probably. You probably count on a couple fingers how many times it's exactly 8%, plus or minus a couple tenths. Right. Like, it's just the world doesn't work that way. That's a long term expected annual return.
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Rachel Camp
Yeah.
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Brad
So you can never know the future. And I think frankly, that's why a lot of us get into one more year syndrome, which is a whole separate issue that we've talked about in the past. And, you know, we can't adjudicate that again here today. But yes, it's a given. It's table stakes. We cannot know the future. But let's just assume this 8%. So if in this case David is saying, okay, using the rule of 72, I would expect this 750 to double in nine years to 1.5, which is what I actually need to be fully fi. And I am going to work to make the $60,000 to cover my expenses. So Coast Fi, that works. But now if we're changing it to barista, where let's, again, for simplicity of math, we'll use the 4%. Right. So he's expecting an 8% return. And this is back of the envelope. So anybody who wants to be a stickler here on. I mean, just bear with me. He's expecting an 8% return, but he's taking essentially 4% out every year. So that is not compounding. Okay, so if you would assume then that essentially cuts your return in half in terms of what is then actually compounding on top of it. So again, very back of the envelope, very conceptual. It would turn, using that rule of 72, you wouldn't be dividing by eight anymore. You'd be dividing by four, which is what's left after you've pulled out this 4%. Now that would then literally double the number of years to get to full fi in this case. So instead of it being nine years under the Coast PHI scenario, it would be 18 years under the barista phi scenario. So again, very back of the envelope. But I hope, I hope that makes sense. Rachel, poke any holes in that? If, if you need.
- [17:13]
Rachel Camp
I was just running it through my financial calculator, seeing what it looked like. So we assume that stable 8% return. We're starting at 7:50. We're taking 30,000 a year. We want to get to 1.5 million. That's full retirement or full financial freedom number. Then we're looking at about 14.3 years instead of that 9 that we mentioned.
- [17:33]
Brad
Okay, cool. So, yeah, that's pretty well in there. Okay, so I think we might have answered the question here and given a nice understanding in terms of both the coast and the barista, which, you know, again, I had never really thought through before this minute. So it's really cool.
- [17:49]
Rachel Camp
Yeah. I've not seen barista implemented. I know people talk about it a lot, but I do think it's a good opportunity if there's a job out there that can support, you know, at least a portion of your income that you feel more passionate about or excited for. You know, some people love the idea of being a barista. Some people want to go into nonprofit something like that. If that's your reasoning, which I see a lot, then I think it can make sense. As long as you run the numbers and understand that if you're doing barista fire specifically, it probably will push out your full retirement year by a few years. And so as long as you see that trade off and you're okay with it, I don't see a problem with it. It's just math at the end of the day. So we'll use those same numbers that we use with traditional fire. Just apply it to barista.
- [18:35]
Brad
Yeah, it's just math and personal preference. Nobody's here to say you have to reach Fi as quickly as possible. Like, that's circa 2015 Phi. I feel like the old school fire. You need to get to this number on. We don't play that game anymore. That's not how this community works. And, yeah, I think it's really important. And just final word, you mentioned health care before, or health insurance really is what we're talking about, not health care. But so many people even today are like, oh, what could I possibly do for health insurance when I leave my job? And it's like, guys, wake up. We've had the aca. Whether you have some political reason against it or whatever it is that you've concocted in your head, this exists. It has existed for a very long time, and it would take a monumental undertaking to get rid of it. It exists for you get that through your brain. Okay? It exists. And it's really easy to use. It's really easy.
- [19:29]
Rachel Camp
And you can go run the numbers without ever signing up for it. Like, it's all there. You can go play with it and see what it looks like for you.
- [19:36]
Brad
Yeah. And you find out what subsidies you get. The healthcare.gov is wonderful. It's the easiest website to use. It's marvelous. And, you know, it didn't used to be great, but it's pretty darn good right now. And it's state by state and you get all your options. And, yeah, if you're in this case, you're making $30,000. I don't know. Off the top of my head, the Exact subsidy. But your health insurance going to cost very, very little.
- [19:56]
Rachel Camp
Yeah. Probably free.
- [19:57]
Brad
Yeah.
- [19:58]
Rachel Camp
Yeah. Go run the numbers for your state. I'm on it. You're probably.
- [20:02]
Brad
Yeah. First year bad.
- [20:04]
Rachel Camp
It's not that scary.
- [20:05]
Brad
It's not scary at all. And it's again, for people in the FI community who are not earning that much income at a point of fi or Barista Phi or whatever, or coastify, you're going to get a significant subsidy. Again, put aside the political nonsense. It's irrelevant. We don't play those games here. We try to make the best decisions possible that we can with the rules as we see it. And you're going to get a big subsidy. That is just the way it works. So, okay, we're going to move on. And we actually got a number of questions on inherited accounts, inheritance and things like this. And I love that you tagged three of these questions. So we're gonna, we're gonna try to weave this all together. But I think we're gonna start with Mark's question because this is a very, very broad one and we'll, we'll really drill down into some significant minutia from there. So Mark said, could I suggest a deep dive on inherited account best practices? I think this would be valuable episode for listeners with aging parents who are planning to pass down retirement and brokerage accounts. If I can provide any more context to help drive the episode, please let me know. And yeah, Mark, great suggestion. This is long overdue, and I'm very glad that Rachel identified these. So, Rachel, do you want to start here in terms of, like, a very broad application, or do you think we should read one of some of the specific questions?
- [21:22]
Rachel Camp
I think we start with maybe just going through the guidelines we have right now and then we can get a little bit more detailed is actually a really timely question because I don't know if anyone has been watching along with what the IRS does, but the Secure act came out in 2020, which completely changed the rules on inherited retirement accounts. And then we spent the last 5ish years trying to figure out and interpret what exactly they meant by that. We finally have, hopefully, definitive guidance on how this actually works. So for anyone who is inheriting an account and the decedent passed after January 1, 2020, the new rules apply to you. So we can dive deep into that. But I kind of just want to give a broad overview of it to start, and I think it always is helpful to understand why there's a change here. So pre2020, if you inherited an account as A non spouse beneficiary, you went through the stretch provision. So basically you got to stretch out these required minimum distributions over your lifetime, which meant there's no, there was no requirement for depleting the account by any certain date or anything like that. It just meant that you got the benefit of stretching out the distributions of your life, which is, from a tax perspective, beneficial to you. Now, the IRS did not love that because they want their tax dollars quicker. So that's when they implemented the 10 year rule for non spouse beneficiary beneficiaries. That's the difference, the main difference between pre2020 and post 2020 with the Secure Act. Now, there's been a lot of confusion with this because here's the overview of the ten year rule. Non spouse beneficiary, which there are some exceptions, we can get into that. But non spouse beneficiary, you have to deplete that inherited retirement accounts within 10 years. But the big question was, okay, I'm going to deplete it within 10 years. Do I have to take anything out in years one through nine? Am I required to do that? And that's where the IRS went back and said, okay, yeah, maybe, maybe. You have to take maybe.
- [23:29]
Brad
Thank you.
- [23:29]
Rachel Camp
Depends. So they did not make this simple. So I understand all the confusion and the delay with it, but it depends on the decedent and the age they were when they passed. So if the decedent had reached their required beginning date for RMDs, then you, yes, you have to continue their RMD. So to explain it simply, if they had already started RMDs, which are those required minimum distributions, it hits years when you turn 70 and a half to 75 depending on when you were born. If that decedent had already hit that age, you have to continue their RMDs. If they were younger than that, say they passed away when they were 65, you actually do not have to continue their RMDs. You don't have to take anything out between years one through nine. The account just has to be depleted within 10 years. So that's a really brief overview of the rules. Most of the time when we're Talking about that 10 year rule, we are talking about non spouse beneficiaries. So typically children, that's where I see it the most. They inherit a retirement account from their parents. They are the ones subject to the 10 year rule. Like I said, some exceptions here which we can dive into, but that's, that's the brief overview of the new rules.
- [24:43]
Brad
Got it. Now, for a spouse that's a beneficiary, this does not exist.
- [24:48]
Rachel Camp
No changes. Technically they could follow the ten year rule, but probably shouldn't, I guess you.
- [24:54]
Brad
Could follow the 7.62 year rule. You can make something up.
- [24:57]
Rachel Camp
You could take it out that first year. But I would not recommend that the spouse can assume the inherited account as their own Iraq. So that's what I see most spouses do. They also could follow the stretch provisions as well, which is they leave that account in their spouse's name and they just take out those distributions over their lifetime. Most of the time, the simplest approach is just for that spouse to take over the IRA as their own, and then they're following their own IRA rules.
- [25:25]
Brad
Okay, gotcha. So there's obviously massive interplay here with the estate tax exemption. There's the step up in basis when somebody passes. Like there's lots of things. And I'm fascinated to learn from you today on in the broadest sense, I've always understood that the beneficiary is largely not responsible for tax, assuming that the decedent and the entire estate was under that estate tax exemption. This, of course, is a very broad understanding, Rachel. And by no means am I saying that this is definitive, but I think in a lot of cases that's generally true, certainly with gifts as well. So it's like gift and estate tax are kind of synonymous because there's this one umbrella number that you get of this exemption. And when someone gives a gift, yeah, there's a yearly annual limit, but if the person who's giving the gift goes over that amount, it's not like there's any tax in the moment. It just, actually just reduces your overall lifetime exemption. So the person getting the gift never pays tax. Even in that case, the person giving the gift is not giving tax. You might have to file a gift tax return. That's beyond the scope of, of what we're talking about here. But I think in very general terms that's how I've always understood it for a state. But now we're talking about like you just spent the last five minutes telling us about RMDs and IRAs. That sounds very, very different.
- [26:58]
Rachel Camp
Yeah, so with the traditional IRAs, you're not going to receive that tax free. So if we look at the different tax buckets here that you could inherit one of them. You briefly mentioned brokerage account. That's where you get that step up in basis. People are actually usually surprised by this. But just a regular brokerage account is a Great, fantastic account to pass on because of the step up in basis. So, so the way that works is essentially, let's just use some simple numbers here. Let's assume there's a father who passed. He had stocks in a brokerage account. He bought those stocks for $100 per share, and those shares are now worth $200, so they've doubled. You inherit that account as the child. What happens is you actually get the benefit of a step up in basis. So what they do is they look at the value of the account on the date of death and step up the cost basis. So let's say the value for each share was $200 when the father passed. The cost basis is now $200 for all of those shares. That means they've wiped out the gain, which means you've wiped out the taxes that you would pay on the gain. So hypothetically, you inherit that account. Let's say the shares are still worth $200. A few days after death, you can sell out of all those shares with no tax impact because you received the step up in basis. Huge, huge benefit. You're essentially inheriting a brokerage account tax free. And if you want to completely liquidate it and transfer it to cash. So when it comes to inheritance, I always encourage people, if that's something that's important to you, to look at your brokerage account to do that, if it makes sense, because that's a great account to pass on.
- [28:34]
Brad
So. Right. Just to give some terminology, because I think it's important that we all just understand because these terms get thrown around. So there's something called. It's unrealized gains in this case. So you have a brokerage account, and in Rachel's example, let's say the father in this case bought 10,000 shares of some stock for $100 each. So his cost basis in totality ON that is $1 million. You just take 10,000 times 100 and that's $1 million. Now, over whatever the intervening time period, it, as Rachel said, it doubled. Exactly. Doubled. You know, miraculous. It's $200. And now that was on the date of death. Exactly. Okay, so that step up in basis when this is now passed to the son or the child in this case. So the value of that account, so the day before the father died was this. Roughly $2 million. So he had an unrealized gain of $1 million. So it's the current fair market value, which is 2 million, minus the basis, which is $1 million in this case, because that's the Cost basis. Now, there are some items that affect cost basis outside the scope of this. We're just assuming this simple stuff. So he would have an unrealized gain if he sold all 10,000 of those shares. Most people are not selling. So you can pick and choose. You have lots of options. But a million bucks that he would have to put as a gain on his tax return if he sold all 10,000 shares. And in that case, if it's a long term capital gain, usually for most, most taxpayers it's a 15% long term capital gain tax rate. Now for higher income taxpayers, it jumps up to 20 for lower for people. And we've talked about this with Cody Garrett. I think in episode 517 there are ways to pay 0% on long term capital gains. And this is a major, major fi hack. But let's just assume the 15. So he would have an unrealized tax liability, in essence of $150,000 that he would owe. But now he never sold them. He passed and his child gets this. And as Rachel said, it stepped up in basis. So it's as if by freaking magic, all of a sudden he didn't buy it for a hundred dollars. The child bought it for each of those 10,000 shares for $200. So as Rachel said, if he sells it that day, 2 million bucks, $0 of gain goes on the tax return. All's well in the world. You reported on the tax return, but no big deal. But now naturally the child might not sell this and it could go up, it could go down. There might still be tax liability, but it's not from that point in time. So that's the critical explanation in terms of the actual terminology. So Rachel, sidebar over. You were rocking and rolling with other, other options.
- [31:15]
Rachel Camp
No, that's that. And that was the perfect example. And I want to caution that if you do inherit a brokerage account, shockingly in your transferring that account, say to your custodian, maybe your father passed and he had an account Schwab used Fidelity and you were transferring it over. You really need to make sure that the cost basis transfers correctly. I see this a lot, shockingly, but it can get lost and that will cause you to pay unnecessary tax when you go to sell. Make sure that that cost basis does in fact step up to the correct basis. It should reflect the value on the date of death. Super important, especially when you're transferring accounts. So just double check that if we want to round out taxable brokerage just really quickly and look at it in the example of a Spouse a joint account and one spouse dies and the other spouse is now inheriting that account. Joint account, super simple for estate planning. So when I have a married couple, I usually recommend titling joints if it makes sense. Just because first state planning, it's the simplest way for them to assume ownership of that account. So technically what happens there with a joint account? One spouse passes, it's actually 50% of the account that steps up in basis. So 50% of the account that was owned by the spouse that passed away that receives a step up in basis. Slightly different for community property states, of which there are nine community property states in those states. What would happen if one spouse passes with a joint account? Actually the entire account would step up in basis. So slight difference. Yeah, if you're in one of those nine states, California is one of them. So a lot of people are there. But that's a slight difference there. But that's, that's taxable brokerage. So simple, great account to pass on. Make sure you get that step up in basis. And then again we have the IRAs and we'd be talking primarily about traditional IRAs and those RMD that are required with traditional IRAs. So just because you are inheriting an account, if it's a traditional ira, you don't get it tax free. As you take money out of that account, you will pay taxes on it. You'll pay tax at your ordinary income rate. So a lot of those rules we were talking about relate to the traditional ira. Now what happens if we inherit a Roth ira? Well, some of you might know we don't have required minimum distributions with the Roth IRA. So how does that work? Well, without RMDs we still are going to follow the 10 year rule for most non spouse beneficiaries. But now because there were no RMDs to start with, we, we get to follow the rule of just depleting the account within 10 years. So if you wanted to, you could leave the account and actually this is what I recommend most of the time when you inherit a Roth is to leave the account until that 10th year because it's a tax free account. And if we can leave it in there growing tax free, we really want to do that. So for most people, as long as you don't need the money, we actually try to leave it in there for the full 10 years. I haven't gotten to that 10 year point yet. The rules are too new. But that's the idea for many of my clients. And then we're going to pull it out year 10. That's for Roth Iras. I hate to throw a wrench in it, but Roth 401ks have separate really weird rules.
- [34:20]
Brad
Really?
- [34:21]
Rachel Camp
Yeah. And it's negative. So if you're wanting to pass on accounts, and unless there's a really good reason for you to keep that Roth in the Roth 401K, it's usually a good idea to go ahead and roll it over into the Roth IRA, because a Roth 401k, they can actually implement required minimum distributions on that account if there is anything else within the 401k, that's non Roth dollars. So really weird Roth 401k rules. I don't know why they've issued different guidance on Roth 401ks, but if you can and you're planning to pass on the Roth account, best practice as it stands right now to get it into a Roth ira.
- [34:56]
Brad
Interesting. Okay, if you're listening, that is great, great information. You'll get nowhere else. That's just a. A simple thing to do. And yeah, there might be issues, there might not be issues, but if you can very simply roll it into a Roth ira, just do it. Yeah, I mean, that's fantastic. So, okay, right. So from a very broad sense, Rachel, this conceptually makes sense, right? Like Roth accounts, the tax has already been paid, so therefore, the recipient in the will here is not required to pay tax when they pull this money out. But then conversely, traditional, as we well know, you get the tax deduction at the time, and then you have to pay tax at ordinary income levels on the amount you pull out. If this was just your account. Right. That's just very simply how traditional versus Roth works. So naturally, the government has never received income tax on that money in the traditional ira, and it's now passed to this child in this case. And yeah, they are still responsible for paying tax on the withdrawals. And then like you said, there's this whole interplay with how quickly you have to do it, etc. Etc. That, and we can never give all the details on one podcast episode, obviously. But again, if you're listening here, this is about just understanding conceptually. So I think that's really important. Thanks for listening to Choose a five and for all your support of our mission here. The absolute best way to support Choose a Pie is when you sign up for your next rewards credit card to use our cards page at choose a buy.com cards. I keep this page constantly updated, so it should always be the top resource for you. Thanks for being part of our community and for your Support. Rachel, I'm curious. So now we've talked about different types of accounts, but what about something like an obvious one would be like a house. So somehow a house, there's only one, one child, there's one parent left, and they own a house. Let's say they have no mortgage and they bought it for, I don't know, $200,000 30 years ago, and now it's worth a million. Okay, so there's, there's $800,000 unrealized gain. Now there would have been an exemption, partial exemption for the parent had they sold that house. But now this gets passed at the date of death. What goes on with that?
- [37:09]
Rachel Camp
Yeah, it's similar to the brokerage account where you do receive that same step up in basis. So that's why I like to think about this in different tax buckets where you have taxable, and I kind of throw in the home with that too, with the brokerage account, and then you have Roth and then you have traditional IRAs. So everything else that would fall under that bucket like a house, you get the step up in basis. The only time where, and I don't want to throw a wrench, but just to cover it, where things might change a little bit is trust. Right. And then it's the type of trust. So when assets are owned in the name of a trust, it depends on the type of trust. So I actually just had an experience with this with a client where they actually inherited a taxable brokerage account. It was in the name of the trust. We noticed it did not step up in basis, so we wanted to make sure that they didn't lose that tax benefit. Well, it turns out it was an irrevocable trust while the owner of the trust was alive. So that's important. And the tax had, or the trust had its own separate tax id. That's a really quick way for you to understand the type of trust, separate tax id. And so that actually did not step up because it was essentially owned by the trust. The trust was paying taxes on it every year. So that basis doesn't change. We're seeing this now with real estate. Sometimes real estate is owned in the name of a trust. And then you're going to follow the rules with the trust. Like I said, depends on the type of the trust. If it was a revocable trust and the tax ID was the same as the owner of that trust, then you should still receive a step up in basis. So you have to check. That's the one thing where we might see a Slight difference is if an asset is named in a trust name rather than an individual's name.
- [38:50]
Brad
Gotcha. Okay, that makes sense. And yeah, just to round out, I mentioned in passing the exemption, right? So the estate tax exemption, there's so many people who just get all hot and bothered about, like, oh, the death tax, and I'm gonna have to pay this and that. And it's like, it's so preposterous. There are probably only a couple hundred people in the US a year, maybe a thousand, something like that, that are even coming close to this. And the estate tax exemption right now for 20, 25 is for one person, $13,990,000. Now it is doubled for a couple to almost $28,000,000. I don't know about you, but I know very few people who have net worth of $14 million. 13, 990. So this is wholly irrelevant to essentially everyone. We can round to everyone. So basically, as we've discussed, the beautiful part about that is we don't have to worry about an estate tax. Almost every single one of us will never have to worry about an estate tax. So the nice thing is, as we discussed, this gets passed on after death. These assets get passed on after death. There's no tax. The estate isn't paying a tax. The beneficiary, slash recipient is not paying any tax. It's just all zipping over. And as Rachel discussed, almost every single one of these accounts or assets get this step up in basis. So again, you're not getting penalized here. In fact, they're showering. The US Government is showering you with benefits. So there's no tax at all. You've got this step up. So it's the day of death. What it was worth that day is what your basis is. So if it goes up, yeah, of course you have to pay tax on the, on the gain in that case, but you don't owe any tax other than on those traditional accounts, which makes perfect sense. They were put in under the guise of, hey, I'm getting a tax deduction now, so this can grow and then I'll pay the tax when it's removed. It retains the character of that, and it should retain the character of that. So, like, I'm always looking for, like, is the world orderly, Rachel? Like, does this conceptually make sense? And that makes a heck of a lot of sense to me. And yeah, I know we've, we've just started on the, the background of this, but I think we dove a little deeper than we expected before we Got into some of the precise questions.
- [41:01]
Rachel Camp
Yeah, yeah, that's a really important point because I kind of ignore estate tax quite a bit. And it's worth mentioning so you understand why we're not talking about it. And if you, if you feel like there's this missing piece going on. The reason I ignore it most of the time is because it's such a small percentage of people it actually applies to. Now, that's not to say that that won't change. At some point. They're always talking about bringing that exemption down. If they do do that at some point, that's where you can get into some advanced estate planning, using more trust, things like that. But for most people, all of that advanced estate planning isn't really something you need to worry about. What you need to worry about is titling things correctly, listing beneficiaries. Let me make a point on that really quickly because with retirement accounts, it is so important for you to have a listed beneficiary because if you don't and it just falls to your estate, there's actually a third beneficiary type that we haven't touched on that applies to anything that falls to your estate and that we are following the five year rule with. So the beneficiary has to get funds out of that account within five years, which is just the worst way to inherit a traditional ira. So one very important thing to do is to look at all of your accounts, make sure they have beneficiary designations. One, from a tax perspective, so they don't have to follow that inferior five year rule. But two, just for simplicity as well, because when you have a listed beneficiary, it avoids probate. The beneficiary is. It trumps everything else. So make sure it's your beneficiaries are updated and accurate and correct. And then it's super simple. Beneficiary presents a death certificate and they're able to inherit that account. Depends on how that account transfers, if it's an IRA or a brokerage account. But it's just one plug I have to give for why listing beneficiaries on your accounts are so important.
- [42:53]
Brad
Yeah, yeah, that's a very important public service announcement. There's no reason not to do it. It only takes a minute per account. It's usually very, very easy to find if you're at one of the major brokerages like Fidelity or Schwab or Vanguard, and I suspect everywhere. Just please do that. Just do that on every type of account you have. There's just no reason not to. There's no reason not to.
- [43:14]
Rachel Camp
Yeah. Can I give two more points? I just want to make sure we cover this because I'm getting these questions so often now. So I know there's people out there that this applies to. And I want to make sure that anybody who is dealing with an inherited account or retirement accounts, that they're not too worried right now because you might have heard that. The point that I mentioned where you have to take distributions from the account, they're required if the decedent had already started those distributions. And if you're concerned because you inherited account in 2021 and you haven't been doing it, you don't have to worry. There is a waiver for the years 2020-2021-2022-2023 and 2024. 2025 should be, and I think it is going to be the first year with this rule is actually enforced. But because the guidance was, was messy, wasn't clear, was all over the place, they did give a waiver up until now, the year 2025. So don't worry about it. Don't start panicking. If you hadn't done that yet, you do have to start in 2025. But for 2020 to 2024, they waived any penalties on distributions from the account.
- [44:16]
Brad
Okay, great information.
- [44:18]
Rachel Camp
One other point I mentioned earlier, there are some exceptions with non spouse beneficiaries. This is something else. I see. But you could actually still follow the stretch provisions with a few exceptions. So if you are less than 10 years younger than the decedent, you don't have to do the 10 year rule, you can actually follow the stretch provisions. This is super important because from a tax perspective, stretch is much better than the ten year rule. And so I see this most of the time with siblings. So if you had like a brother who passed away, your brother is four years older than you, you don't have to follow the 10 year rule. You're actually considered an eligible designated beneficiary and you can follow stretch provisions. There's an exception for minor children as well. They can follow stretch until they get to age 21 and then actually flips to the 10 year rule. And then chronically ill, disabled, they're also eligible designated beneficiaries. So at a very high level we covered it. But if this is applicable to you and you actually are inheriting accounts, it's really worth double checking to see what beneficiary designation you fall under.
- [45:21]
Brad
Yep. Okay. And that is, that's the takeaway. There's no way you could remember everything Rachel just said, it's almost beside the point. It's. You need to understand there are special rules for those cases. So if that jumped out to you, you need to remember that you need to research it, you need to contact a professional. So that's the critical piece. All right, Rachel. So we went really in depth into that, which is awesome. I had mentioned at the outset that we had a couple of different people that you had earmarked of people who had written in about inheritance and such. And frankly, we answered just, just about all of it. So I'm not going to read the two emails, but Zubi had asked something about life insurance and if there's any taxability of that. And I guess she also asked about fees. Some general worry about. Basically, as I read it, like, this is overwhelming and I'm worried really that there are going to be some vultures who try to step in and help me, quote unquote, but maybe just charge me more than is necessary. So I know we can't really answer that today, but maybe just like a quick overview of, like, are there things to do? Is that a valid concern or is it. Is it really? Hey, I have my accounts at these major brokerage firms and. And it just all kind of works itself out. I know that's very nebulous, but I guess let's start with the life insurance and then we'll go into that.
- [46:43]
Rachel Camp
Yeah, we didn't actually cover life insurance, but that is. Is another great thing to inherit. I hate to use the word great when we're talking about inheritance, but from a tax perspective, yeah, we get life insurance tax free. And I know it can be stressful to kind of come into a large windfall all at once, especially if it was unexpected, of course, or. And you're just worried about managing the money. She mentions fees here. Being stressed about that. Totally understand it. We didn't really hit the mental part of this, but I do find it's good practice to kind of take a breather, take a break, give yourself a little bit of time to fully digest everything. There's a lot of paperwork that you have to deal with when somebody passes away. But I don't think it's any reason for you to stick with a custodian or an advisor that you don't know, you don't feel comfortable with. I see people do that quite a bit, is they just let that current advisor continue managing the account for them without ever really establishing a relationship with them. So just understand that this is at this point you know, your money, and it's worth taking a break here, figuring out what you want to do. Do you want to work with that advisor? Do you want to meet other advisors? Do you feel comfortable managing it on your own and then just doing that, you know, whatever is the best decision for you. You don't have to inherit an advisor when you inherit accounts as well. So I know this is kind of a topic on just feeling overwhelmed, and I completely understand. I wish that inheriting money was simpler because it's already a stressful time in and of itself, but there is a lot of paperwork. Sometimes the advisor is going to tell you that before you can transfer the account out, you have to transfer it to an inherited ira. That's actually standard practice. I've gotten a few questions where people were worried about being scammed because they thought it didn't make sense that, that the advisor was telling them it has to go to an inherited IRA before it transfers out. That actually is the standard now. So go ahead and follow that. But as far as everything else for where you want the money, how you want to manage it, don't feel pressured into keeping it where it is.
- [48:49]
Brad
Yeah, I think that's good advice. And Glenn also wrote in, and that was one of the other ones that you had identified here, just about how stressful this can be. And I think, as Rachel said, like, this is a stressful time and that's normal. And I think that's why it's important to just have an understanding of this. Maybe again, at this high level of just listening to us talking about it and just understanding that, okay, no matter what anybody says out there, like, I'm not going to have to pay tax on this. There's nothing terrible, it's going to, like, befall me in terms of inheriting this money. I just need to understand that, really. As we discussed, the traditional IRAs. Traditional, those type of accounts you are going to have to pay taxes on when you pull the money out. And there are these rules that you'll figure out. You can hire, go to Nectarine and hire a CFP for an hour for $150 or whatever they charge and just ask a couple questions like, hey, what are the rules? Right? Like, is it 10 years? How long do I have? What do I have to do with these things? Maybe somebody at the brokerage will be able to help you, but that's few and far between because usually they're not allowed to give advice. So they can inform you if you knew to ask the right questions, but they're not in very broad terms, from what I've seen, they're not allowed to give advice. So that's a critical distinction. But yeah, Glenn is really just describing here that, I mean, listen, this is stressful. There were a bunch of issues for, I guess in this case a family member passed and there are multiple steps and you have to stay on top of it. And I mean, yeah, you do. But I think the nice part is, and as you said, Rachel, it's not easy to talk about this. Like people die all the time. And when you have your money with a major brokerage, they have seen this literally millions of times. This is. Your situation is not unique or special to them. So they have people who can help you. You just need to ask. You just need to make the phone call and you need to ask. And you have to understand that there are just steps to this and it is all going to work out. It is an extraordinarily stressful time. You have to cut yourself some slack. But it's going to work out because at the end of the day, it's just step A, B, C, D and E and it's done. And hopefully it's fewer than steps A.
- [50:57]
Rachel Camp
Through E. Yeah, it depends on the custodian where the accounts are held as well. I see some that are really antiquated and Glenn mentioned notarized documents. Unfortunately, that is still a requirement with some custodians, some. So if it's a multi step process, if it's taking a while, you know, stay on top of it. But sometimes depending on the firm, that is just how they work when this happens, you know, call the firm, be ready with the information you have. Be ready with death certificates. That's one piece of advice I always give. Often you can request a lot of copies of the death certificate. So I always recommend having a lot of copies there because a lot of these different firms, if the money's all over the place, they're going to ask for that death certificate. So call the company, tell them who you are, tell me your beneficiary, ask them what do I need to do to get this account transferred to me? And do your best to just stay on top of it. Fill out that paperwork they need, give them the death certificate and watch.
- [51:54]
Brad
Yeah, yeah. All right, Rachel. So I think we thoroughly covered that. That feels like a really good start on inherited accounts. That was a pretty significant deep dive for a mailbag episode. So that was fun. We have one last question. So Ann in Brooklyn wrote in and said, any tips for how to continue Investing when you're at the early stages of entrepreneurship. I was great about saving and investing each month when I work for someone else and had reliable income. But I've been working my for myself full time for about 18 months now, and I'm just clearing the feast or famine stage. The first seven months working for myself, I was busy. Then I had five months with no clients at all. But happily, things have turned around. I'm still in business, but I'm having such a hard time pulling money out for the future when I don't know what lies around the next corner. And yeah, I mean, Rachel, this is, I suspect. And maybe. No, personally, this is a. A common lament of entrepreneurs is. Yeah, I mean, one of the nice parts, obviously, about W2 income is that paycheck's coming every two weeks. No matter. Essentially, as long as you're employed, that paycheck's coming every two weeks or whatever it may be. And sure, it sounds alluring to want to have your own business and go out on your own and do all this stuff, but anybody who tells you it's not stressful is a liar or a fool or maybe both. So that's. That's from 10 years of experience of being an entrepreneur myself, is. It is quite stressful. Now, that doesn't mean it. It can't be wonderful. It doesn't mean it can't be rewarding. It can be all of these things, but it certainly is stressful. So let's be entirely clear. It will always be stressful. So, okay, that's my random sidebar, but what are your thoughts on Ann's question in terms of, like, the actual heart of what she's asking?
- [53:37]
Rachel Camp
Yeah, I was really excited to dive into this one because I really relate to it. So, you know, I'm thankfully, what. We're five years into entrepreneurship now for myself, but those first few years were really stressful, especially somebody who comes from the financial independence community. Community like myself. To turn off that savings muscle is actually really difficult and stressful. I had to really give myself permission to see my business as an investment and see that the savings, okay, maybe now they're not going into the index fund, but they're going into the business. And so that's how I had to reframe it. To give myself permission to stop being such an aggressive saver in index funds was to say, I'm still saving, I'm still investing. It's not like I'm spending this money just now being directed to the business. Now we can't promise that that is going to be a better return than index funds. Anybody who's an entrepreneur knows there's risks involved there, and that's just part of it. So, thankfully, you know, if you're young enough or if you've just thought through this, you probably have time to recover if the entrepreneurship route does not work out. But for anybody in the first one to two, three years, even of entrepreneurship, it's stressful enough. I would just encourage you not to add that extra stress of having to save in the first few years of trying to start your business, you know, on top of it. So I would say give yourself permission to really go for it for a few years. That means releasing the pressure of continuing to invest. If you're an entrepreneur who that first year or first two years are great for you and you manage to invest in index funds alongside it, you're actually the exception. You're not the rule. That's great. But just know that most entrepreneurs are struggling with that as well and that it's okay to give yourself that break for a few years.
- [55:21]
Brad
Yeah, I love that would echo it entirely. Is, yeah, you are at this point investing in building your business because you believe that it can be something significant because otherwise you wouldn't have left your nice, safe, predictable W2 job. Right? This is obvious when you actually think about it, but it's not obvious. Right? Like, that's why we. We need to talk about this. That's why Ann has this question. We've all had this question. But when you really dive into it, you are investing in you. You are investing in your business because you believe there's a chance that this can be fantastic. So as Rachel said, just cut yourself some slack. Come on. Right? Like, we get so bent out of shape in the FI community about my savings rate needs to be 37% or I'm 30 failing. Come on. Like, this is ridiculous. You're living an intentional life. That's what we're doing in the fight community. We don't have arbitrary, random financial goals. Again, this is not 2015, okay? We are trying to live the best lives we can. And in this case, you've made a very intentional decision to leave your safe job and build something for yourself. And that's wonderful. And the absolute worst thing that happens is it doesn't work out. You spent a couple years and you go back and you get another W2, and it's no harm, no foul. You go back to saving. This will be but a blip in terms of your actual fine number. You will never Remember this, okay? But you bet on yourself, and that's pretty darn cool. You should feel really good about yourself. So that's the worst case scenario. And, and using Ann as as an example here, if she's been saving for years, we spent the first 15, 20 minutes of the episode Rachel talking about Barista fi and coastify. It changes the calculus of this entirely. Right? So it's funny how these actually tie so closely together. You don't have to save if you have a net worth like I illustrated. Like you have a $187,500 net worth or whatever the number was. And it's going to turn into 1.5 million in 27 years. Now, obviously, nobody's going to write up an example of, hey, I want to be stressed in my entrepreneurial endeavor for the next 27 years. Not arguing that, but it's nice to know that all you need to do is coast on in. You just need to cover what your life costs. It doesn't need to be a home run. And that could be something like working in a passion project that, hey, maybe I'm making a fraction of what I used to make, but as long as it's enough to cover my life expenses, I'm golden. So I think really ratcheting down the pressure is the key that both of us would ask.
- [57:48]
Rachel Camp
Yeah. And it is why I'm such a big fan of coast fi. And I'm seeing this more and more where people are, you know, working traditional W2 jobs. They're saving aggressively, but their goal isn't to hit that full retirement or financial freedom number and then retire. Their goal is to get to Coast Fi or maybe a little bit beyond that as quickly as possible so that they can take this risk. And it's very interesting cause it's kind of a new thing I'm seeing. We see a lot of entrepreneurs glorified as putting everything on their credit cards and going into debt and asking for money from family. But now we're seeing this emergence of people in the FI community doing it in a more calculated, educated way, taking some risk off the table. I thought through this, personally, I hit Coast Fi and it was such a positive impact on my life because now I knew I can afford to stop investing in index funds and I can afford to invest in my business. And I'm not inflating my lifestyle then I'm still spending the same as far as personal expenses go. So really I can afford to take this risk with the business and plow a lot of money into it. And really go for it. That's why I love this combination of the Coastify and entrepreneur now because it is that gives you that peace of mind to really go for something. And now you can just deal with the stress of the business rather than the stress of the business and finances on top of it.
- [59:10]
Brad
Totally agreed. Rachel. This was super fun. I really enjoyed this episode. As always. Thank you for coming on. You said this is number seven that we've done together, which is crazy and seven of many more to come. So where can people find you, reach out to you? What's the best way to get in touch?
- [59:26]
Rachel Camp
Yeah, so website is rachelcampwealth.com go to the website that will direct you everywhere. Social media, things like that. But camp underscore wealth on Twitter. Camp wealth on every other social media platform. Thanks for having me.
- [59:39]
Brad
Yep, this is fun. Absolutely fun. And yeah we will have links as you can see. You want to make sure you spell Rachel's first name right. So obviously we'll have a link to her website in the show notes. So definitely check that out. As you can tell from this episode in the prior mailbag, she is a wealth of resources. So Rachel, thank you so much.
- [59:56]
Rachel Camp
Thanks Brad.
- [59:58]
Jonathan
Thank you for listening to today's show and for being part of the Choose a 5 community. If you haven't already, the best ways to get involved are first subscribe to the podcast. So you're listening to this on a podcast player. Just hit subscribe and then subscribe to my weekly newsletter. I actually sit down every Monday and write this by hand and I send it out Tuesday morning. So just head over to choosefi.com subscribe and it's really, really easy to get on the the newsletter list right there and I would greatly appreciate it. It's the best way to get in touch with me. You can actually just hit reply to any of those emails and it comes directly to my inbox.
- [60:34]
Brad
So that's the way that I keep.
- [60:35]
Jonathan
A pulse of the community and how we keep this the ultimate crowdsourced personal finance show. And finally, if you're looking to join an in real life community we have choose a vi local groups in 300 plus cities all around the world. So head to choose a vi.com local and you'll find a list of all of Those cities in 20 plus countries all across the world. And if you're just getting started with VI or you have a family member or friend who you think would be interested, two easy ways choose a Fi episode 100 is kind of our welcome to the Fi community and even though.
- [61:09]
Brad
It'S a couple years old at this.
- [61:11]
Jonathan
Point, it still stands up. And it's a really great just starting point to get an understanding of what is financial independence. What are we doing here? Why are we looking to live a more intentional life where we save money and use it as a springboard to live a better life and then choose? If I created a Financial Independence 101 course that's entirely free, just head to choosefi.comfi101 and again, thanks for listening.