How to Money – “Your Smart Money Guide for 2026” (#1084)

Hosts: Joel & Matt
Date: January 5, 2026

Episode Overview

In this special new year episode, best friends Joel and Matt kick off 2026 by laying out their essential personal finance guidance for listeners. Instead of their regular listener Q&A format, they offer an updated, honest, and practical “table-setting” guide: how to smartly approach your money this year. They reflect on the need for goal-setting, teach their Money Gears system—an order of operations for financial priorities—and discuss current economic realities and mindsets to help listeners thrive.

Key Discussion Points

1. 2026: New Year, New Perspective

• The hosts discuss the unique “fresh start” energy of early January:
  • Joel (00:47): “New year, New you, baby.”
  • Why it feels like the first “real day” for many; the balance of reflection and looking forward.

2. Reflecting on the Past Year

• Start by reviewing last year’s goals and honestly assessing progress and pitfalls.
  • Matt (03:56): “What sticks did you shove into your own spokes?”
• Reflection involves examining not only results, but the feelings around those results. Were you exhausted? Did you overdo it? Did you leave space for living?
  • Joel (05:38): “You might even find that you hit goals...and you’re like ‘man, I was exhausted at the end of the year…’”

3. Frugality vs. Deprivation

• The show’s mission: make personal finance accessible, jargon-free, and fun—frugality does not mean a miserable existence.
  • Joel (08:46): “We want everyone listening to know that frugality does not equal deprivation… Frugality can be fun.”
• Craft beer as an example: Enjoying occasional small luxuries is part of living intentionally and happily.
  • Matt (10:15): “We talk about our craft beer equivalent...you got to find that balance for you as an individual.”

4. Goal Setting and Thematic Intentions for the Year

• Set concrete, written, and meaningful goals—ideally in partnership with a spouse or friend. Make these visible (e.g. post-it on your mirror).
• Consider a “theme” for the year instead of just a number—e.g. “the year of intentional spending,” “financial clarity,” or “debt payoff.”
  • Joel (19:26): “Maybe a theme... just a theme for the year...can make all the difference from a mindset perspective.”

5. Money Gears: The Order of Financial Operations

(See [22:06–40:34] for a detailed walkthrough)

Why “gears?” Like biking, you don’t start in the highest gear—you build up, gaining momentum in the right sequence for efficiency and safety.

Gear 1:

Starter Emergency Fund

• Now: $3,045 (updated for inflation)
• High-yield savings account recommended
  • Joel (23:19): “If you haven’t met this goal yet, that is going to be the first thing on your to do list.”

Gear 2:

Company 401(k) Match

• Contribute enough to get your employer match—no better return exists.
  • Matt (25:26): “It gives folks a taste early on of what it means to be an investor...a nice little foretaste of things to come.”

Gear 3:

Pay Down High-Interest Credit Card Debt

• More urgent than ever given ~22% average rates.
• Consider using tools like undebt or working with a non-profit if overwhelmed.
  • Joel (28:08): “Make a plan to get it paid off quickly… high-interest rate debt is the kind of stuff that...if you don’t make a plan to stop the bleeding, it’s triage.”

Gear 4:

Fully Funded Emergency Savings

• 3–6 months’ worth of expenses, customized to your life’s risk factors.
• Again: High-yield savings account, not investing.

Gear 5:

Tax-Sheltered Retirement Investing

• Ramp up contributions (target: 15% of income) in 401(k), IRA, Roth IRA, etc.
• Focus on low-fee, broad index funds; keep it simple and diversified.
  • Joel (36:23): “Simple and effective, low cost and diversified…that’s really what we talk about here on the show.”

Gear 6:

Eliminate Lower Interest Debts

• Knock out remaining car loans, student loans, etc., except cheap mortgages.
• If your mortgage is at 7%+, extra payments may make sense.

Gear 7:

Advanced Moves & Increased Flexibility

• Pay extra on mortgage, ramp retirement contributions, consider other investing, fund 529 plans, take sabbaticals, give generously, etc.

• At this stage, customize for your lifestyle and goals.

  • Joel (39:15): “Once you get here, you can go in a million different directions...the truth is, once you’re hitting those later money gears, you’re kind of cruising downhill.”

6. The K-Shaped Economy & Personal Trajectory

• Rather than the myth of “average,” view the economy as a ‘K’ with some moving up and some down. Be honest: which direction are you trending?
  • Joel (41:22): “It’s important to think about what trajectory you’re on… the K-shaped visual is more helpful.”
• Both hosts reflect on their own humble career beginnings and encourage listeners: Your starting point doesn’t define your trajectory.
  • Matt (44:13): “At the beginning of 2007, I had $868 to my name...If you had taken a snapshot then, they’d say ‘Millennials are so broke.’”

7. Community & Accountability

• Find people to talk money with—friends, partners, spouses, or the How to Money Facebook group.
• Normalizing discussion about money and goals makes it easier to stay motivated and reach milestones.
  • Joel (50:49): (On his friend launching a podcast) “There is something about when you say, ‘Hey, this is what I want to do.’ ... Bringing a friend into that alongside with you is such a beautiful thing.”

Notable Quotes & Memorable Moments

• “What sticks did you shove into your own spokes?” – Matt (03:56)
• “Frugality does not equal deprivation… Frugality can be fun.” – Joel (08:46)
• “You got to find that balance for you as an individual.” – Matt (10:15)
• “If you don’t make a plan to stop the bleeding, it’s triage.” – Joel (29:31)
• “It’s a bunch of little things over time, stretched out over the years—those returns, they compound.” – Matt (49:08)
• “The trajectory… would not be what it is without our friendship.” – Joel (49:06)

Timestamps for Major Segments

• 00:44 – New year, first “real” episode of 2026
• 02:20 – Table setting for the year: goals, review, themes
• 08:46 – Frugality vs. deprivation and the value of balance
• 14:31 – Importance of meaningful, visible goals and themes
• 22:06 – 40:34 – Deep dive: The Money Gears framework
• 41:22 – K-shaped economy: why it’s a better lens for your financial progress
• 47:26 – Power of community and having money conversations
• 51:22 – Joel & Matt’s personal financial priorities for 2026
• 56:43 – Quick craft beer review (“If Only to Be Thoughtless Once More,” Burial IPA)
• 58:05 – Episode wrap-up

Hosts’ Personal Financial Priorities for 2026

• Joel:
  • No audacious new savings goals this year; focus on using the freedom already built.
  • Supporting his wife’s new career.
  • Putting more into their kids’ 529 accounts (“That’s my craft beer equivalent this year—it costs a lot more than this IPA!” – 53:28)
• Matt:
  • No big new goals; focus on deepening relationships and living out the fruits of years of financial discipline.
  • Inspired by the Harvard Happiness Study: “The number one thing—the quality of close relationships.”

Closing Thoughts

Joel and Matt remind listeners: This show, and their journey, is about making money less painful and more joyful—not just about saving for the sake of saving, but about using resources to build the life (and relationships) you truly want. They encourage listeners to set intentions, follow the Money Gears, be gentle with themselves, and find community for support.

Best friends out!