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- [00:00]
iHeart Podcast Announcer
This is an iHeart podcast. Guaranteed Human. Run a business and not thinking about podcasting, Think again. More Americans listen to podcasts than ad supported streaming music from Spotify and Pandora. And as the number one podcaster, iHeart's twice as large as the next two combined. Learn how podcasting can help your business. Call 844-844-IHeart.
- [00:20]
Joel
Welcome to how to Money. I'm Joel.
- [00:22]
Matt
I'm Matt.
- [00:23]
Joel
And this is your smart money guide for 2026.
- [00:45]
Matt
You know what, buddy? It's 2026. Let's go.
- [00:48]
Joel
New year, New you, baby.
- [00:49]
Matt
It's the first real day of 2026.
- [00:51]
Joel
I.
- [00:52]
Matt
Well, it's not really the first real day.
- [00:54]
Joel
It's the fifth.
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Matt
But it is, though.
- [00:55]
Joel
It's your first real day.
- [00:56]
Matt
I think it's most people's first real day of 2026. That's true. You can't have the. You can't have New Year's day be Thursday and expect everyone to be like, yeah, it's the new year.
- [01:05]
Joel
Let's be productive tomorrow in the office.
- [01:07]
Matt
That makes almost as much sense as your kids going back to school last fall on a Thursday. Right. Or on a Friday. On an actual Friday, which made even less sense.
- [01:18]
Joel
We skipped the first day of school.
- [01:19]
Matt
You're like, we're still gonna be at the beach. Don't judge.
- [01:22]
Joel
That was ridiculous.
- [01:23]
Matt
I will say normally, so if folks haven't listened to the podcast, normally on Monday episodes, we hear directly from you, our listeners. You would normally take a voice memo that you can easily record on your phone and you email it over to us. You say your name, you say where you're from, because that's always fun. And I like to Google where it is that people live. People know that at this point, which is actually bizarre. Yeah. The last one, she literally put her actual address so we could. I don't know, I don't want to go there. But like the general town, if I haven't heard of a town, I like to click around and get a feel for it, see what they have to offer, see if I want to go visit there at some point. Like if, you know, if you're on a road trip and you've heard of a small town, Matt's paying house visits to listeners now, so I get in there. But normally, yeah, Monday episodes, ask how to money episodes, we have the voice memos and we, you know, we're able to directly answer listeners personal finance questions. But with this being the first real episode of 2026, we wanted to do something a little special you know, set.
- [02:21]
Joel
The table a little bit for the coming year. And so, yeah, we'll have kind of some general thoughts on getting your Money together in 2026. We'll cover a little bit of the money gears. We'll talk about maybe what to expect in 2026, and kind of maybe the. A little bit of the current state of the economy. We'll kind of hit a bunch of things, Matt, run through a bunch of things that we think are important for people to consider as their current thinking about their personal finances going into this year. 1. Does it.
- [02:47]
Matt
Does it feel like there's too much pressure on this episode? Because it's like the first. It's gotta be the first perfect episode of the year.
- [02:51]
Joel
I don't think so. I'm okay.
- [02:53]
Matt
You know, I don't know. You were talking to me earlier, like, this is gonna be a good one. I'm like, I know it's gonna be a good one, but also, you know, you can't pack it all, otherwise we'd be. You know, we're gonna be sitting here for, like, five hours, right? If it's like. And then we're gonna have on a guest who's gonna deliver some brilliant nugget, and then we're gonna answer some listener questions. You and I are going to crush two craft beers.
- [03:10]
Joel
Because that's why I said this is setting the table. It's like a nice tablecloth on top of the table. There's no food or anything. It's like it's kind of going back to the basics in some ways.
- [03:17]
Matt
We're bringing the food. There's going to be some actual sustenance here. This isn't just fluff.
- [03:21]
Joel
All right.
- [03:22]
Matt
No, that's not what you mean.
- [03:23]
Joel
Not what I just meant. That's not what I meant. I think one. One of the things maybe I wanted to suggest, starting off as we're entering into a new year, one way to maybe at least start thinking effectively about your finances for 2026 is. Is to reflect on how things went last year. Matt, I don't know about you, but, like, yeah. What were your goals for last year? How did you do in comparison to what you'd set out to do? And then think about maybe, like, what were the hurdles that got maybe thrust into your path, that frustrated you in your attempts to meet those goals?
- [03:57]
Matt
What sticks did you shove into your own spokes?
- [03:59]
Joel
There's that, too, right? How are you. Your own worst enemy at times, preventing you from being able to. To reach that goal? And I'm sure All of us, if we do a little bit of thoughtful reflection, I think that is one of the first good places to begin. Hundred percent. Because it can help us then say, well, all right, now that I know myself a little bit better, I know how I did in comparison to what I want to do last year. Maybe you're one of those incredibly disciplined people, or you just got kind of lucky this year too. Maybe your goal was like, to grow your net worth and like the same. The stock market doing well in 2025 really helped you to be able to do that. And. But, like, what were your goals? How did you do in comparison to what those goals were? I think it's a really good. Really good thing to think through.
- [04:39]
Matt
Yeah. I don't think we do enough reflecting as a culture, although with, you know, with there being more attention being paid towards mental health, I think folks are. Or at least there's a whole lot of language around it though, right? How often are people actually sitting down and reflecting and journaling and thinking about what. Not only what happened, but then how do you feel about that?
- [04:58]
Joel
Right?
- [04:58]
Matt
Because I think that that can have a larger impact on your. The steps that you take moving forward. It's not just literally what happened and what goals you were able to achieve and not achieve, but how are you actually interpreting those results, good or bad. And I think that could have an impact on whether or not you see yourself as, oh, actually, I'm a good investor. Oh, I'm a good saver, or I am a diligent worker. This is what we're able to accomplish. And if you're able to, like, internalize essentially some of those behaviors as opposed to only fix the. The results are good, Trust me. Like, I'm a datas guy. Like, I've got the Excel spreadsheets going back. That is really important. But also to sort of internalize some of the behavior that you set out to achieve last year. I think that's really important.
- [05:38]
Joel
And you might even find that you're able to hit some of those goals and metrics that you wanted to hit. And as you reflect back, you're like, man, I was exhausted at the end of the year and I needed that break. Right. Like the 5th of January, I'm back to work. Like, I'm a little worried because I don't think I can keep up the pace. And so maybe you overdid it. Like, that's. That's even worth considering too. I think for some people, especially people who listen to how to money Matt, they are like, go Getters. And so, like, did. Did you overdo it to the extent that maybe you actually need to dial back some of those goals so that you can live a little bit more of your life in the here and now? Totally. That's. That's worth considering as well. So. And really, like, the truth is 2026 is going to be different than 2025. We're going to face different. Different challenges, different opportunities. And there were a lot of Both, Matt, in 2025, for investors and for people trying to get smart with their money. And I think that the more you have your eyes on your money in a healthy way, the more you're going to be ready for whatever challenges come your way and you're going to be able to take advantage of opportunity when it strikes. Think about even just the beginning of last year and like, it was tariffs, man, they're going to destroy the economy. And there was a lot of.
- [06:45]
Matt
You shouldn't have sold. I was telling you, you shouldn't sell at the bottom, Joel.
- [06:48]
Joel
See, I didn't. And I was one of those people who were like, man, tariffs are going to have. They had a more muted impact than even I thought they would. It felt like a Covid blip. Yeah.
- [06:56]
Matt
Like, honestly, it's like a mini little Covid blip. When we look back, it's like similar, actually a lot of similarities. Like kind of towards the beginning of the year, just this false. Oh, no, the world's ending. But then in reality, oh, we are actually more resilient than we think. And I think the economy, a lot.
- [07:09]
Joel
Of investors, what the truth is there are blips that you can take advantage of or there are ways that maybe you might say, I don't know, man, that news is freaking me out, or that that prognostication prediction is freaking me out and so I'm going to invest less or something like that. And then if you had done that, if you had listened to those predictions, even then you would have missed out on an abundance of returns. Totally. Yeah.
- [07:33]
Matt
By the way, I want to mention too, you might hear some leaf blowers in the background. And Joel, Joel, I almost called you something different. Whatever you want to call me, I think that only speaks to kind of our, like, down home ness. Like, we're just two dudes, best friends. We record in this carriage house that we rent. And you know what we're surrounded by? Honestly, beautiful, like 100-year-old oaks, but they drop a lot of leaves. And dude, I gotta hate the leaf blowers. They, like, get under my skin. They, like, find their way into, like, my sinuses, like, where the sound resonates, rattles it around.
- [08:05]
Joel
Yeah, no, and it's. It's really the bane of a podcaster's.
- [08:08]
Matt
Existence, unless you live in the middle of some giant building where there's no windows.
- [08:13]
Joel
But that's.
- [08:14]
Matt
That's the other thing. I mean, you can literally go to our website and see a picture of us here recording. But, like, I love this space because we have windows to the outside and the true real environment, the sunlight, man, I don't know. Would you trade off having a view to the outside world in order to have perfect silence?
- [08:30]
Joel
No, I don't think I would.
- [08:32]
Matt
I don't care that much about it not sounding perfectly polished and like, a studio.
- [08:36]
Joel
When I worked at a radio station, we had all of these pristine recording studios that had no windows to the outside world.
- [08:42]
Matt
And you come out of there pale and a lot more sterile, detached from the outside world.
- [08:46]
Joel
You feel like a vampire. You feel like a vampire. How we roll well, and, Matt, when we're talking about what this show is, by the way, if you are new here, this show is all about removing jargon, keeping things simple. We want you to achieve financial independence. We talk about all facets of money, from saving and investing to debt, payoff and intentional spending. We also touch a lot on the behavior and the mindset stuff, too, because that really does matter. Your emotions factor into your money maybe more than you think they do. And we attempt to run the gamut so that you can make meaningful changes in your life. And our ideal for you is that money would become a less painful endeavor, that you get more joy out of your life because you handle money so effectively. We want everyone listening to know that frugality does not equal deprivation. Matt. I think too often those two terms have become synonymous. So you're telling me to become frugal. You're telling me that I need to hate my life. Not true. Frugality can be fun and want to give you thoughtful ways to think about frugality. And the truth is, it can lead to meaningful results, but it's also not frugality all the way down. That's not how we roll. It's not fr.
- [09:51]
Matt
Frugality on top of frugality all the way down.
- [09:53]
Joel
No.
- [09:53]
Matt
By the way, we didn't mention our beer, and I feel like we're kind of all over because this is because I'm used to, like, Lister questions and just the structure that comes with that. So because of that, I feel like this is a Little more freewheeling. But we do enjoy a beer during every episode, and we're enjoying, if only to be thoughtless once more, which is an IPA by burial. We're enjoying that, and we're going to share our thoughts at the end of the episode.
- [10:14]
Joel
Why do we drink beer on the podcast?
- [10:16]
Matt
Because we talk about our craft beer equivalent. This is something that we are splurging on in the here, here, now, in the moment. Is it the best use of our money? There's an argument to be made that it is, because, sure, we could forego all the pleasures of life today in order to invest and save for larger amounts down the road, but you got to find that balance for you as an individual. How are you going to enjoy and embrace and seize the day today while also preparing for the future? And for us, craft beer is one of the ways that we literally demonstrate that and enjoy it here on the podcast.
- [10:49]
Joel
It's the balance that we're trying to strike, right? It is that, like, let's be thoughtful and intentional about what we want to achieve 5, 10, 20 years down the road, but not forget that we have a life to live in the here and now. There's a lot of that, I think, in parts of the personal finance space where it's like nose to the grindstone, head down, so that you can achieve this massive savings rate and this goal that it's at the end of the rainbow. And really what happens for a lot of those years, it's a slog. And I've met too many people who went so dang hard for a slew of years that it feels like they didn't even lift their head up to enjoy their life. For a lot of people, it's in those 20s and 30s that are years that you'll never get back when it comes to forming relationships or making memories. So just in case you're wondering, we're not all about that lifestyle.
- [11:38]
Matt
Totally. And you mentioned goals, Joe, so. Joel, why do I. I almost keep saying Joe? I think that's what I'm saying. Am I speaking too quickly? Joel, my best buddy. I need to actually pronounce a new best buddy.
- [11:48]
Joel
That's okay. Over the holidays.
- [11:49]
Matt
His name is Joseph. I was gonna say you mentioned goals, and I'm guessing that a lot of folks are already tired of hearing about people setting goals, setting smart goals, you know, whatever goal, acronym strategy approach to setting your goals, but still. And we're only gonna spend a second on this, but I do think asking what it is that you want to achieve this year is just so important to hitting the mark. Joel, you mentioned like review and kind of looking at how you did last year. But it's equally important to maybe have a conversation with your spouse or your significant other, your partner, or do this by yourself if, if that's where you're at. But I just think writing those goals down to make them concrete, enacting some sort of plan is going to be so vital to you, seeing progress and then just keeping those goals just front of mind. Like, like literally in front of your face. I think actually you can literally write it on a post it note, stick it on your mirror in order to help remind you of that. But knowing what it is that you want to achieve and then just knowing that that is what is fueling you to get up every day, get up earlier in order to work a little bit harder, to self deprivation a little bit. Right. Like you talked about frugality, not spending in a way that's going to allow you to sock away a little bit more. Maybe you're trying to eliminate some debt and you know that every dollar that you're not spending on yourself is something that's buying you some of that financial peace of mind. And I said paying down debt, but it could be anything, right? Like, like the name of this episode is Smart. Your Smart money guide for 2026. But this could also be like your guide to being a first time homebuyer. This episode could be your guide to paying down debt. It could be your guide to juicing your 401k. Because guess what? Money is fungible. And everything that we're going to talk about here on the show, certainly in this episode. But like for the rest of the year, you can apply to whatever specific goals that you might have in your life. And so keep that in mind. We're not talking about money generically, but it is up to you to figure out what it is that you are that you're striving after. And hopefully, man, you really do need to think about this because it's not just about increasing your net worth, right? Like if you're somebody and you're just fueled by seeing bigger number good. Like that's boring, you know, like, I hate to say it, but like I don't want to hang out with that kind of person. Someone who is only interested in, in the stats. Like, I don't know, I'm sure you might know a statistician who's very interesting and fun to be around.
- [14:07]
Joel
But you like getting invited to Matt's.
- [14:08]
Matt
Super bowl party it's just. Well, actually, I don't know if you're playing the odds and you're doing more betting, we won't get into that right now. But I'm just saying that the people who are striving after, like, audacious, really cool, fun things. That is interesting. And I think that's what. It just makes you a more well rounded person. And if you haven't done the work to identify what it is that you're making these sacrifices for, man, that is your first step.
- [14:32]
Joel
And I think it's so easy the further along you get into the personal finance sphere to you kind of start to understand how some of these accounts work. You start to actually realize the impact of compounding returns. And you're like, whoa, that's really cool. My money is starting to work really hard for me. And at some point you even hit that place where maybe your money is working harder for you than you can work for it. And it's kind of enthralling. But that is also. We strive to recognize that's not the end goal. Because if that were the end goal, you're right, Matt, that is a really boring end goal. The goal is to use that money to create a life that you can enjoy. And part of that does take some sacrifice now so you can set yourself up for more options down the road. But it doesn't mean full on deprivation now. That's for sure. Totally agree. And I don't know, Matt. I like the idea of becoming a person who enjoys saving or who sees the value in frugality instead of like that kind of forced mechanism of like, I guess I got to handcuff myself so I can make progress with my money. Maybe instead of. Could your goal be to become the kind of person who enjoys some of those things? Maybe like, man, I got to go to thrift store to save money instead of buying it on my favorite clothing retailer. Well, maybe you can turn, turn it into the, the fun of the hunt, right? To find something that's completely undervalued at the thrift store. Like your favorite name brand sweater or something like that. That's $5 instead of 50. Like that's a cool perspective to take on going to the thrift store.
- [15:58]
Matt
That's my identity shifting that's taking place there.
- [16:00]
Joel
Instead of feeling like you have to. Or can you make cooking at home more delightful? Because I think for a lot of people it can feel really painful. How can you set yourself up for success on that front? Because the truth is, and we all know this that eating out has got become incredibly expensive. The more you do it, the more money you are tossing down the drain. It's okay to carve some money out for that in your budget, but maybe think of it as not just something you have to do to save money, but something that you can enjoy, maybe. Whether it's like, making the meal together with your spouse or something like that. I mean, whatever it is, I like the idea of becoming that kind of person. Like, one of my goals this past year was to run 1200 miles. And it wasn't literally just to hit that number. So crazy. It was. I have friends who ran a lot more than this. They're even crazier than I am.
- [16:43]
Matt
But, see, I feel like that's when there's. Like, at a certain point, it's too much, but I feel like you're not there yet.
- [16:48]
Joel
So. Yeah, we'll see if I get there. I'll try to refrain. I'll try to refrain. But, like, part of that goal was yet to hit a numerical number at the end of the rainbow. That was pretty arbitrary. But the other goal for me, the main goal for me was to become the person. It wasn't like, oh, I'm training for this one race that I want to do well in. It was like, I want to be the kind of person who. And 1200 miles, literally, I said 100 miles a month because I wanted to be the kind of person who was consistent doing it regularly and feeling better because of it.
- [17:16]
Matt
You are a runner because this is who you are, as opposed to. This is the kind of life that you're leading as opposed to some arbitrary goal, is what you're saying.
- [17:23]
Joel
So guess what? The likelihood of me running, like, 200 miles this year is not high because I have become the kind of person, even though I don't actually. I don't really know what my running goal is yet for this year. Like, but I know it's not gonna be 200 miles because I'm just the kind of person who enjoys running now. And I couldn't have said that four years ago.
- [17:38]
Matt
You've moved past that.
- [17:39]
Joel
Yeah.
- [17:40]
Matt
Like, I think what I hear you saying is, like, it might be even worth considering, like, a theme for your year. So for some people, I think this could be the year of, like, let's say you just are looking for some more financial clarity. Right. Like. Like, you are someone who understands you've gained more insight about your financial mechanism, like, where things are going, like, the nuts and the bolts. Right. For others, I think the thing could be like a year of more intentional spending, especially if you found that you spent way too much over Christmas and you need a bit of a. Of a financial detox. But I really like this idea because it's. It's less focusing on a specific numerical goal. It's less. It's even less like, oh, I want to completely eliminate my student loans this year, or some folks are just like, dudes, I'm so far away from being able to purchase my first home.
- [18:24]
Joel
Right?
- [18:25]
Matt
Like, so these are all. The whole. These are all like, the pot of gold at the end of the rainbow kind of goals. And what we're talking about instead are habits, and these are behaviors that you can put into action now before you even know what it is that you're looking to move towards. We talk about big savings goals for folks and having cash on hand and liquidity. And we always talk about how our tastes change and something new comes on the horizon, and all of a sudden, I want a new car or whatever it is, right? And if you have worked towards building up a Just a savings bucket for something that you don't even know what it is that you want to spend on yet, it's going to lead to you being able to achieve that obviously, much quicker. And so in a similar way, you're. This is, I think, by latching onto a theme of different behaviors or actions that you might take, even without an end goal, I think that that's going to get you closer to whatever end goal it is that you might end up identifying later this year or a couple of years from now. But you are going to be in such a better financial position because of, hopefully some of the things that you've done here. From listening to the podcast, it makes.
- [19:27]
Joel
Me think of, like, families who come up with a motto, and I think we did that a while back. I don't remember what it is now. Like, I need to go back and revisit that, because I've seen other families who create one and they live by it, Right? And it's like, in this family, we prioritize this. And then when you're trying to decide what you do with your time, your efforts, and your money, it's really easy to revisit that motto and be like, are we the kind of family who does this thing? Yeah, because it's in our motto. Like, our motto says that we care about fun. And so, of course we're going to get the season pass to Six Flags or whatever it is, but we're also the family who cares about Generosity. But we're not the family who cares about this. And so, like, maybe a theme. It's not this overarching, lifelong theme, but just a theme for the year. And the truth is we go through seasons, things ebb and flow. So maybe this season is, maybe this year is like the year of less, a year of minimalism, a year of decluttering. Maybe, you know, maybe it is the year where you're like, debt payoff. I'm going so hard. Like, this is going to be the year where I get rid of credit card debt and finally and I'm done with it for good. Like, but I love that idea of having a theme so that you can always revert back and be like, does this, does this jive, this move that I want to make with my money? Does this go along with what I'm trying to accomplish this year? And sometimes just a theme, a few, a few words spoken over what you want to happen this year can make all the difference from a mindset perspective.
- [20:39]
Matt
Totally agree. Let's keep this party going, though. We're going to take a quick break, but when we come back from the break, we're going to talk about the money gears, which is what you should be doing with your money and when you should be taking those actions. We'll get to that and more right after this.
- [20:58]
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- [21:30]
Joel
All right, we're back. And Matt, in just a bit, I want to talk. Let's talk about like the K shaped economy and specifically kind of where things are happening in what's happening in the economy right now, how people can identify where they are on that spectrum and how we think. That's like an informative way of thinking about things. But let's get to the money gears, man. I feel like the money gears is it's basically if you go to the howtomoney.com you click start here, you'll see the money gears. And it's been our way of telling people an order of operations for your money so you can figure out well, where am I along this spectrum in order to know what to do next? And we call it the money Gears because you and I were fond of biking.
- [22:07]
Matt
We love biking. We still bike all the time. I biked here today. Okay, yeah, I'm gonna explain it. And the reason we call it the money gears is because everyone knows when you are at a standstill and you need to get biking, do you start on the tallest, most hardest, fastest gear? No, absolutely not. And by fastest gear, I mean you.
- [22:26]
Joel
Also can't turn the pedals if you.
- [22:28]
Matt
Would hurt yourself or you might even, like, break your bike. I mean, eventually, yes, you will get rolling, but it's gonna be like, literally, it could be painful. And in a similar way, you could start with more sophisticated investing. But you know what? If you don't have a basic emergency fund set aside, there are going to be setbacks. You can essentially, when you're on a bike and you're in the proper gear, you can achieve your goal, your destination a lot more efficiently. You can, I think, achieve it much quicker and in a similar way. That's what we think about the money Gears. By going in order, we think that you're going to be in a. A stronger financial position.
- [23:02]
Joel
So you mentioned emergency fund. That is always, always has been, always will be money gear number one. We. We updated it this past year, though, because of inflation. We updated the amount of money that you should be setting aside in your high yield savings account. And I'll tell you why I said high yield savings account in just a.
- [23:19]
Matt
Second, but it used to be $2,467. 467.
- [23:24]
Joel
And that was because of a survey by economists, and they said that most people would be able to get. Be able to get through an everyday emergency with that kind of cash on hand without having to resort to using credit cards. Well, adjusted for inflation, that number is now $3,045. So that is the number we're rolling with right now. 30.
- [23:42]
Matt
45.
- [23:43]
Joel
Yeah. So if you can, if you haven't met this goal yet, that is going to be the first thing on your to do list, is to find a way to slowly but surely get that money in a high yield savings account. I say high yield savings account. Matt, too, because you and I were not fans of the big banks. They don't pay much on your money. They often have fees that are associated with your account that some of our favorite online banks do not. You can find those, you know, references to those, our favorite online banks up on our website. But this is. This is the first Money Gear, and it is literally, like, the easiest way to get going. It's going to save you a lot of potential headaches down the road, if you like. If you don't have liquid cash on hand, it just puts you in a plethora of uncomfortable situations. That's right.
- [24:26]
Matt
So that's Money Gear number one. Money Gear two. The next most important thing to do is to get your company match. If you have one available to you, if you are getting, let's say, like a 50% or 100% match in your 401k, there is no greater return on your money. And, Joel, do you know why I love Money Gear number two? And the fact that it's the second thing that most folks will pretty quickly.
- [24:48]
Joel
Be able to achieve aside, why do you love this?
- [24:51]
Matt
Is it because there's plenty of reasons to love it? But why do you think. Think I'm choosing it right now? That's the next one I'm asking you to step into my brain.
- [24:58]
Joel
That's the next one in line. But also I think part of the reason you love this is because you never had access to one. You always wanted a match. That is true.
- [25:05]
Matt
Although, you know, we. Once we started this company, we. We technically have a solo 401k and we match.
- [25:12]
Joel
Yeah, but you never had, like. That's still a third party.
- [25:15]
Matt
Yeah, yeah. It's just me taking off my employer hat and taking off my employee hat, podcaster hat and sticking on the. What am I, the cfo, Slash, co founder employer hat. I'll call you the CEO.
- [25:26]
Joel
I don't know if that's warranted. Also.
- [25:27]
Matt
Also co founder. No, the reason I love it so much is because it is.
- [25:31]
Joel
Oh, I'll be the cco, the Chief Creative Officer. How does that sound?
- [25:34]
Matt
Oooh, what's the CBO? Chief Beer Officer. No, I really like it because it gives folks a taste early on of what it means to be an investor. Right. It gives you a taste early on of what it might feel like to have compounding returns work in your favor as opposed to against you, which a lot of folks, that's. That's how they experience interest. Right. They experience having to pay more for less as opposed to. As opposed to the opposite. Right. And so let's say you sock away, like, 5,000 bucks into your 401k and you got a match on, you know, like 5% of your salary or something like that, and you basically, at the end of the year, you get to see that grow from 5,000 to 10,000 at least. That's assuming 0% return market.
- [26:15]
Joel
That's just the employer match. And then let's say there were returns on top of that. Let's say you went to.
- [26:19]
Matt
It might be even more than that. Yeah. But, like, that's incredible. Incredible. Because early on, I think it can be disheartening. I think it can be demoralizing because you're working and you're like, oh, I feel it. I thought I was investing. And then you look down, there's not a ton of money there, man. It's fully, purely 100% dependent. Again, not 100% dependent, like there are some returns from the market, but your ability to grow your net worth by you sacrificing and you depositing that money into your account. Like, that's what is predominantly dependent. Dependent on.
- [26:48]
Joel
Yeah.
- [26:48]
Matt
And you don't really get to experience those joys of compounding until much further down the road.
- [26:53]
Joel
Right.
- [26:53]
Matt
Where your money starts working harder for you than you are. This is like a nice little foretaste of things to come where you can say, oh, man, like, there is just an aspect of this that I am able to appreciate now, knowing that it'll be amplified even more down the road.
- [27:09]
Joel
I remember those first years being an investor. I had to trust what other people were saying to me that compounding returns were coming down the pike because it's hard to believe it. It feels like, especially with, like the low salary I was making, shoving 6 or 8%, then trying to grow it eventually into more putting, putting that money into the 401k, getting a little bit of a match. I was like, gosh, it still still feels paltry, like, how I'm never going to get, like, become wealthy this way.
- [27:34]
Matt
Yeah. Did you have much of a match?
- [27:35]
Joel
I had 50% match up to 3, 3%. So if I put in 6, they put in 3.
- [27:40]
Matt
Okay.
- [27:41]
Joel
So, I mean, that's.
- [27:42]
Matt
I would say nothing, actually.
- [27:43]
Joel
Probably the average of what people are exactly expecting. And I've heard from more people actually this past year where their match got cut. And that's a tough position to be in. But I think, you know where things are with the economy. You might see more employers doing that. And then you have to, like, reassess how much I'm going to put in and how much is it worth it. But I think money gear number two, taking advantage of the match. You're right. It's.
- [28:03]
Matt
You can't be, though. You can't be that 50%, 100% return on that money, man.
- [28:07]
Joel
It's the free money. It's the investor mentality.
- [28:09]
Matt
Yeah.
- [28:09]
Joel
After that money year number three is to work towards paying down high interest credit card debt. And that was, I think one of the top stories of this past year, Matt, was that credit card interest rates got worse. Which means if you have revolving credit card debt, it's doing more damage to your finances than ever before. Instead of 17%, it's like 22% right. On your credit card. It makes it harder to pay it off because you're accruing more interest. Our thing here is to make a plan to get it paid off quickly. And if you feel like you're in over your head, you might want to even turn to a nonprofit like Money Management International or something like that. Think about the website undebt. It is a good place to kind of create a plan.
- [28:48]
Matt
That's if you want to like DIY it. Yeah, yeah.
- [28:51]
Joel
If you want to DIY and you still have.
- [28:52]
Matt
If you feel like it's not completely out of control, that's a great, great resource for.
- [28:56]
Joel
Yeah. And you can kind of have them list the debts in order. How much free cash do you have, list out those debts and how long is it going to take me to pay this debt off? I would think that actually AI would probably be a good tool for like inputting your debts and then saying, here's how much free cash I have. How should I attack this?
- [29:12]
Matt
Fascinating. I haven't done that yet. I've actually used it for some other things where I'm like trying to figure out. Yeah.
- [29:18]
Joel
Doesn't that seem like that would be a perfect.
- [29:19]
Matt
Awesome.
- [29:20]
Joel
Yeah.
- [29:20]
Matt
I would like to think that it would say. But depends on how you see the world. I don't know.
- [29:25]
Joel
Yeah.
- [29:26]
Matt
What's the kind of nuance that you would expect to find here on how to money? Joel. Right. Guaranteed human. Well, you know, that's us.
- [29:31]
Joel
I. We. I did episode 620 back in the day. The foolproof plan to ditch that. You can go back and listen to that especially. Especially if you're new here. But that credit card debt in particular, the high interest rate debt is the kind of stuff that if you don't make a plan to stop the bleeding, it's triage. It's going to continue to be a massive problem for you. And so you have to have like. I think that needs to be a square focus after the first two money gears. Getting rid of that high interest rate debt.
- [29:56]
Matt
Yeah. It doesn't matter how much broccoli you're eating and if you're getting enough sleep and taking Your vitamins and drinking enough water. If you're like, bleeding out, you need to fix that first. And that's like, that's the same thing when it comes to cutting out some.
- [30:08]
Joel
Of these just the worst debts, and.
- [30:11]
Matt
We'Ll get to some of the worst debts, some of the lesser damaging debts. But it makes me think of, like, folks will talk about toxic relationships. Like, that's something that's really bad, Right. They're like, oh, yeah, like toxic relationships. And I don't know if this is. This feels like counseling relational advice, but, like, imagine you got somebody in your life and you're like, man, every time I hang out with them, they just want to tear me down. Or they're discouraging, blah, blah, blah, and you're like, I want to go find some new friends. I would venture to say that maybe you have to, like, be proactive about not hanging out with that. Some of those toxic relationships, before you even have room in your mind, like, before you have, like, the mental bandwidth to get out there and to meet some new folks. Or maybe it's, you know, like a partner who wasn't that great for you. That's somebody that needs to be completely cut out as opposed to, like, keeping it around and being like, no, no, I can incorporate that relationship with these other relationships. I don't think that's how it works. I think that really bad relationship might end up, like, poisoning some of these other relationships too. There are certain things that we have to completely remove in order to make some of the forward progress. And I think this is an instance where, like, you're kind of streamlining too. It's like, less is more. So, like, in this way, you know, because, like, again, you're freeing up some of this mental bandwidth that you have, and your mind's not just, like, running circles around itself trying to figure out how to just, you know, make minimum payments on some of this credit card debt.
- [31:24]
Joel
Yeah. So just your toxic relationships and your toxic debt in 2026. Toxic debt. There you go, Matt. I think you just inspired people on multiple fronts. Congratulations.
- [31:33]
Matt
The relational advice. Yeah, don't come to me for your relational advice.
- [31:37]
Joel
Money Gear number four. So we'll move on then, is really going back to the emergency fund. So Money Gear 1, the basic emergency fund. Next, get the company matched. Next is to pay down high interest debt and then go back and fully fund your emergency fund. And so much of how much money you need to save, there is no number. There was no patented stock number for this like we did. Having Money Gear Number one, because it depends on the specifics of your household income. Right. Three to six months worth of expenses should suffice for most people. And the truth is, $3,045 just isn't enough to get you through bigger emergencies that can come along. It does not allow for enough flexibility. If you decide you want to make a big pivot in your life or if some, like, yeah, let's say job loss or something like that or, you know, hits you or some sort of terrible medical diagnosis comes along, the $3,045 isn't going to be enough for you to have the flexibility you need if you're combated with a larger emergency. The $3,000, that's like, for basic stuff, right? Like, hey, my transmission just went out. And even that, I don't know if $3,000 quite comes out.
- [32:45]
Matt
Oh, yeah. These days, transmission is the number one, I'm pretty sure. Joel, as I look at my 2012 Honda Odyssey, that is the repair that might total the van for us.
- [32:54]
Joel
It's a big risk for you.
- [32:56]
Matt
Yeah, it's just. I've just. As it shifts, I'm like, ooh, is it starting to. Is it starting to slip a little bit? It's something that I'm trying to stay on top of. If we get to that stage, I'm like, oh, my gosh, we're have to get a new ride.
- [33:06]
Joel
I recently changed the transmission fluid and helped make it shift a lot better.
- [33:10]
Matt
We talked about that privately.
- [33:12]
Joel
Have you done it?
- [33:13]
Matt
My next oil change, I'm 100% going. I was like, oh, dang, when's the last time I had a fluid flush? And I don't know if I've ever done that.
- [33:21]
Joel
Okay, it's time.
- [33:21]
Matt
There's some maintenance that we've stayed on top of like clockwork. But then there's other things. When you bounce between different mechanics, it almost like resets the clock on some of these other also very important things that you need to do that are going to maintain the longevity of your car. But, yeah, I think I've been a bit negligent, but let's keep moving. Money gear number five. You just mentioned money gear number four, the fully funded emergency fund. Oh, by the way. Which you're totally going to keep where? In your high yield savings account. This is not money that you invest because you need it to be there. Liquid ready to go in case stuff hits the fan. But money gear five, tax sheltered retirement accounts. That is what's next. You might be tempted to continue to hoard that cash because for the first time you're like, oh my gosh, this is what margin feels like. I can breathe. I am not living paycheck to paycheck. And you might think, oh, more of a good thing is just a good thing, right? And no, because investing is going to be key to outpacing inflation. It's going to be key to growing money for your future for retirement. And there are a whole slew of different accounts available. And depending on where you work, you might have access to a 401k. You might have access to a TSP Thrift Savings Plan 457B. If you're a teacher working for a nonprofit, you can also invest in an ira. We're big fans of the Roth ira, never having to be taxed on those dollars ever again. But more than that, I think prioritizing low costs and diversification, what you're not going to hear us talk about are is buying individual stocks. Occasionally we'll say because the less than 5%, we're okay with that for you to invest that much of your overall net worth in individual stocks just for fun. But like that should be. I can't even believe I said that because like, that should just not even be an issue. If you are investing in tax deferred retirement accounts for the first time, you need to be looking at total stock index funds or the s and P500 and specifically paying attention to the expense ratios on that. Anything that's less than 0.2% is okay. I would prefer to see folks though closer to like point zero three percent because that's all it takes.
- [35:34]
Joel
Yeah.
- [35:34]
Matt
Or if not free, with Fidelity, you got the FC rocks.
- [35:38]
Joel
And there are a lot of personal finance folks out there who will talk a lot about a bunch of different investing tactics you can take. And the truth is, man, there's some really good content creators who are really smart out there in this space. We've even had some of them on the podcast. Even like Ben Felix, who we had on at the end of last year, talks a ton about investing. He's so smart. Loved talking to him. But it's also possible, especially for a show like this, to really over complicate things to actually the detriment, I think, of listeners. And so if you feel like you're at that place and you're like, man, I'm ready to create my own like 12 fund portfolio, there are awesome folks out there who you can listen to to figure that out. But I think for the vast majority of folks, Matt, they want just like simple and effective, low cost and diversified. And so that's really what we talk about here on the show.
- [36:24]
Matt
And that is literally how we invest as well. Yeah, I mean, 97, 98% of my net worth is invested in either the total stock market index funds offered by Vanguard or Fidelity or the S and P with Fidelity.
- [36:38]
Joel
And so and until you're investing 15% of your income, you're in money gear 5. Don't beat yourself up if it's taking a while. I think we're talking about these money gears, Matt. You just kind of move through them like clockwork. The truth is, especially think about Money Gear number one might take somebody hopefully no longer than six months, but it just depends on a whole lot of what's going on in your financial scenario. Money Gear number two, that hopefully doesn't take too, too long to get the full match. But the further you get along these money gears, the longer it's going to take to build up, let's say, six months worth of expenses in a savings account. That can take a really, really long time. So be generous with yourself, be gracious. The same thing is true with money gear number five. Until you're early investing 15%, you're going to be in money gear five. So money gear number five, all about getting more money then into your investment accounts and just growing the overall amount of your income that you're able to stash away for your future.
- [37:31]
Matt
That's right. Next, Money Gear number six, that's when you can start paying off low interest debt with vigor. That could be, if you've got one, that could be a car loan, it could mean paying more on your student loans than just the minimum. It could mean paying off a HELOC home equity line of credit more quickly if that's something that you've utilized. But in Money Gear number six, we've got savings, we've become good investors and now we are just eliminating some of the less offensive, some of the less nefarious kinds of debt. That being said, your mortgage, if you have a low rate, interest rate mortgage, home loan, mortgage, hold off, don't do that just yet. That feels, that's more like a Money Gear number seven action item.
- [38:12]
Joel
Right? Although I will say in Money Gear number six, if you were the kind of person, if you bought a house, let's say in the last two years and your interest rate is in that 7% range, boom. That fits. In money gear number six, you might want to then be paying more towards your mortgage because it's, you're not able to Earn more legit just in a savings account than you are paying an interest right towards, towards your home lender.
- [38:34]
Matt
Yeah. And you said 7% because that's where it's. If it's any more than that, absolutely slam dunk. Any less than that, that's when it's like the lines get a little blurrier. It's tough. Like that 7% mark does not make it easy.
- [38:47]
Joel
Yep. So Money Gear number six is really about paying off a lot of those other kinds of debt, with the exception of the mortgage. Or if you have some other kind of debt, like, I don't know, Matt, from people who have student loans from 20 years ago might still be at a really low interest rate. Like maybe you can pump those off a little bit further, maybe make those a top priority. And it's been fun this year. Matter of fact, I feel like we've seen a lot more money. How to money listeners reach Money gear number seven. Once you get here, yeah, you can go in a million different directions. Like you can go back to school to pursue another career. You can pay for it with savings that you've been able to to ramp up, or you can increase your investment percentage so you can reach financial independence sooner. So instead of stopping that 15% of your income, now you're like, boom, let me see if I can hit 20 or 30% of my income just in money that I'm putting into my investment accounts every month. That's a cool goal and it just allows you a lot more flexibility. Sooner you can take a sabbatical. We've got episodes on that. We took a sabbatical this summer. That was one of those things where like, we're buying more of our time back. The truth is, once you're hitting those later money gears, you're kind of cruising downhill. And a lot of folks never achieve this. But I think a whole lot of people in the how to money community, Matt, are going to. And it's not even because they make six salaries. It's not like we've got everyone who lives in Silicon Valley listening to this podcast. But it's because the people who listen to this podcast are living intentionally. They're watching, they're spending, they're prioritizing. Investing over consumption. They could be doing in the here and now. And they value the lifestyle that you can't buy on Amazon. Right. As the, as the Grinch would have said a few weeks ago, like, it came without packages, boxes or bags like that. We realize as how to money people that the truth is the best things in life are not consumables. And consumables can be good, but they're not the end all, be all.
- [40:35]
Matt
That's right. But we've got more to get to, man. We are going to cover some additional steps that you can take to help your money to go further for you to reach your financial goals. We'll get to all that right after this.
- [40:50]
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- [41:22]
Matt
All.
- [41:22]
Joel
Right, Matt, we're back. Talked about the Money Gears, which I think is just such a helpful framework for most people just who are new to personal finance to figure out. And even if you've been listening for a while, you're like, oh man, that was a good refresher. I forgot, where am I at? Oh, I'm on Money Gear number four. Okay, that's what I need to do next. It's a good idea and we'll link to it in the show notes. But it's also on the start here button of our homepage if you're like, I need to do more digging into those and how they function. We just kind of gave a brief overview. We actually have individual articles for every Money Gear so that you can dig in and see exactly how to attack it. But let's get a little more current here for the last section, Matt, and maybe we'll even share our own priorities for 2026, our financial priorities here at the end of this episode. But I want to talk about the K shaped economy for just a second. We've talked about like where you are in the money gears, but it's also important to think about what trajectory you're on. And we just hear so much in the media about the extremes like the rich, richest folks in the world, the people with multiple yachts, and then folks living in like poverty, impoverished situations. But I was talking to my friend Pam recently, Matt, about this and like we agreed that the K shaped visual is more accurate and more representative, more helpful. I think that we, we exist along a spectrum typically and, and sometimes we're moving up that spectrum Sometimes we're moving down it, or maybe we feel like we're staying static. We're just kind of in the middle of the K. And that K is really just like, hey, who's making improvements, doing better? Whether it comes to income and lifestyle and the downward part of the K where people feel like they're not doing as well as they used to do, I think people are increasingly worried about the possibility of moving down rather than up. I do think that's something that's on the top of people's minds, especially higher prices and stuff like that. But instead of thinking about the average or the extremes, I think the visual can help you think more about your specific situation, how you're doing right now and where you feel like you're headed. Because I think that has so much to do with how we feel about our money in our lives.
- [43:17]
Matt
Yeah, yeah, I agree. But yeah, hopefully folks are. When they see, like, you say, K shaped economy and everyone pictures the K and you're like, well, hopefully, like, I want to be on the K part that's going up. And I, I mean, I do think that there are a lot of listeners and that is where they are. I do think that there are a lot of folks and they're encouraged by what's ahead. I always get frustrated when folks talk about how Gen Z, how they're just so poor. But I'm like, this is the generation that just finished college. This is the generation that's in their first job where they are making. How much did you make, Joel, in your first job?
- [43:54]
Joel
Well, I was part time in my literal first job out and then my first very full time job. I want to say I made like $24,000, adjusted for inflation. I don't know what that would be.
- [44:02]
Matt
Same, same. So in preparation for the new year.
- [44:05]
Joel
You probably low to mid-30s, Kate.
- [44:07]
Matt
And I, well, then I made less than you because my take home was less than $21,000.
- [44:12]
Joel
Wow.
- [44:13]
Matt
In 2007, and Kate, we were looking over our budget for the year as we're just kind of seeing how we did in 2025, getting things together. Like, literally at the beginning of 2007, I had $868 to my name. Like, that's how much money I had in my savings account. And guess what? If you were to have taken a snapshot right then, they'd be like, guess what? Millennials are so broke.
- [44:33]
Joel
Well, and they wrote those headlines and they did.
- [44:36]
Matt
But, like, I'm just saying that those headlines do not define you who are listening to this. And you are feeling like, oh my gosh, these guys are talking about setting aside six months of living expenses. Like I don't even have enough to hardly pay rent this month. To a certain extent, like we have all been there. But I think that you've got what it takes to be able to climb out of that. And I want to see folks just identifying with that K part that's going up as opposed to being like, like the slow lazy part of the downward K that's just like it's going to peter out here for a little bit and then things aren't going to be looking up for, for me anymore. Well, I think that we've got a lot of listeners who are going to be optimistic about what lies ahead.
- [45:14]
Joel
I also, I get frustrated with the people who crap on the small ways that you can claw back money in your life. Like we talked about frugality earlier and how much of an impact that can have. Because I do think every dollar, especially in those early years as you're trying to get that like garner your first $10,000 in investments and then moving on up that curve like it's every dollar matters, feels like it matters more in those early years. And the reason is that's true. Like when we talked with Brian Preston, the money guy, like he talks about how his is koozie. It's like this $1 beer cost me $88. And it's because a dollar invested really early on in your life, let's say when you're like 20, can really turn into $88 later. A dollar invested at the age 50, guess what? It's not going to be worth $88.
- [45:58]
Matt
That's right.
- [45:58]
Joel
Unless you live to like 140 or something like that. Right. Which is not going to happen unless our AI overlords say that it will. But like if they allow it, if they. Yeah, if they hook you up to.
- [46:08]
Matt
Some sort of power generating machine and you've got a plug into your spine jewel the matrix, which nobody even knows that reference anymore.
- [46:16]
Joel
You're probably right.
- [46:17]
Matt
So.
- [46:17]
Joel
Oh my gosh, it's still worth watching. I went back to watch it like a year. Great. Classic. Yeah, well, and I think like this, this also just. Hey, where are you? We'll also have some say over like what you do next with your money and how much. Let's say go back to money gear number four, fully funding your emergency fund. Well, let's say you are a two parent household, but you've got one income and that income feels really precarious. Right. Now, you might want to ramp up your savings beyond six months. Like, you might even say, actually, I need nine to 12, because depends on your level of risk. Yeah, I work in an industry and my job, my career is a little more at risk. These are all things to take in mind. And like, with economic fluctuations, it's just crucial to build more resilience into your financial plan.
- [47:01]
Matt
That's right. You know, this makes me think too, how it's just so important to not do this alone. I think it's so important to find friends who are down to talk about money. And I would point folks to join the how to Money Facebook group if you spend any time at all on Facebook. The only time I do spend on time. The only time I do spend on Facebook, Joel, is if I'm looking like you'll reference something that's going on in the Facebook group. I'm like, oh, I'm gonna go check it out. Or Facebook Marketplace.
- [47:26]
Joel
Actually, those are literally. It's the groups and Marketplace. The only two good things about Facebook. And I actually plug for the Facebook feed eradicator plugin so that even when I go to Facebook on my desktop, I'm not confronted with any posts. And so it's just like, you don't.
- [47:42]
Matt
Get sucked into that hole.
- [47:43]
Joel
No, it's like a Buddhist quote or something like that. Usually that sits there where the feed would be. And so I just go directly to the groups or directly to Marketplace. I don't have to see any of that nonsense.
- [47:51]
Matt
Yeah, but I mean, one of the goals of the show is for us to talk about personal finance, to talk about money, to talk about what you're spending, how much you're investing. And that's not typically something that happens in real life. It's why we have the show. It's why we encourage folks to head over to the Facebook group because they. They do do that. But we also want you to get out there and touch grass and work to talk about these types of topics in real life. And, Joel, this is something that you and I, that we literally were doing before we started the podcast. Like, literally, the original show was called Poor Not Poor, and maybe you can imagine why we called it that. Originally, it's still the name of our llc, which I love, but we changed the name of the show to how to Money because it's more searchable. But we were talking about these things before we started the stupid podcast because we enjoyed it and we saw that, oh, my gosh, by challenging each other, we are ending up in better places. I know I am in a better position because of our friendship, my friend.
- [48:41]
Joel
Same money wise and in other ways.
- [48:44]
Matt
Yes, it's not just about the money, but. But it is how the money, after all. But have these conversations with your spouse, with your partner, with your friends. And man, I know that this is life changing. I know that the trajectory, like where my family is right now, Joel, it would not be, it would probably be pretty close had we never met. But I know I am in a better position because of our friendship.
- [49:07]
Joel
It's a bunch of little things over.
- [49:08]
Matt
Time, stretched out over the years. Those returns, they compound. And we hear from listeners too. Like, I was getting back to a, an emailer, a listener this morning on email and she was talking about how, I think she said it was like life changing information is what she called it. It was just a short little sentence. But what that told me was that she is not only listening, but she is putting into action some of the stuff that we talk about. And year after year, decade after decade, I mean, I've been the stuff that we talk about like this, the quote unquote plan. Like, I've effectively been doing that for over 20 years now. And it's no surprise that you see your network, your net worth grow and you see how it is that you view consumption and how it is that you perceive enjoyment in the here versus enjoyment in the now. Like, these are things that you think about and it takes time. But I want to encourage folks to. Yeah. Have these conversations not only with your friends, your partners, but also online.
- [49:57]
Joel
Yeah, I mean, you're making me think too about one of the, one of the trends that we covered Maybe early in 2025 was loud budgeting, where people were just like on social media, like yelling out the ways that they were trying to save money and just kind of making frugality, normalizing it a little bit. I think there is this really important thing about putting your hopes, your dreams, your goals out there in front of other people who love and care about you so they can ask about it. Like one of my friends at the end of last year, he wants to start a podcast. He wants to launch his first episode in the next week or so. He reached out to me in early December and he was like, hey man, can you stay on me? Can you text me about this? And there is something about when you say, hey, he told me this is what I want to do. And then he was like, can you help me? And man, bringing a friend into that alongside with you is such a beautiful thing. So, yeah, you better believe I pestered him and I texted him. How's it going, man? Like, how you making progress?
- [50:49]
Matt
What's the topic?
- [50:51]
Joel
So it's actually. He used to work for, like, a radio music station, and so it's about, like, celebrity encounters. Yeah, super cool. Yeah, like a down to earth celebrity encounters podcast. So I'm curious to hear the first episode, which should be coming out shortly. I'll text him again after we finish recording here. But that's the kind of thing where when you say it out loud and when you involve others in your plan, the plan is just so much more likely to succeed than just keeping it locked in your head.
- [51:16]
Matt
I love it. Do you want to. Do you want to. Do you have any financial goals, Joel? Like, we talked about goals in the first segment. You want to share any that you've got for 2026?
- [51:23]
Joel
Okay, so I don't have any audacious money goals for 2026.
- [51:27]
Matt
I think, like, I want to keep on keeping on.
- [51:30]
Joel
It's sort of like. And I think that's okay. Right? There were a lot of years I had really, really big goals. And I think my goal right now is actually to use more of the freedom that I've gained using it. Well, yeah, boy, right?
- [51:43]
Matt
Like speaking my language.
- [51:45]
Joel
Part of that is like, hey, supporting my wife in her new and budding career, like, that's a big part of it. While still, like, building how to money and having fun, doing the work that we enjoy doing, doing it together. I think maybe if I was to call out one big account that I care about this year, that, like, three years ago, if you'd asked me, if it mattered to me, I would have been like, yeah, not really the 529 account. I'm putting more money into the 529s for my kids. And.
- [52:09]
Matt
But also, you've been doing this for 20 years, right? And so, like, that's a priority that you.
- [52:13]
Joel
That's a Money Gear seven priority.
- [52:14]
Matt
That's a Money Gear seven kind of priority. And a lot of folks will start putting the cart before the horse. And like, no, man. Like, there's a lot of different ways that you can pay for college, assuming your kid even goes to college. And I know everyone's like, well, of course my kid's gonna go to college. You don't know. Like, there's a good chance they will, but leave some room for their own decision making and autonomy. Well, which is why you. It's less of a priority, but not still super important. And I'm glad you're doing that well.
- [52:38]
Joel
And like we've talked about the changes to make 529 plans more flexible has made them at least more interesting. Like from a parental perspective. Part of that is too, because you can now pay for K12 education with $529. And so I did not think our family would be a private school family until this last year. And our oldest of three, it was the right move for her for us to do for her. And so the $529, it's like, hey, boom, if I stick more money in there, I get a tax break at least on the money I'm forking over. And I will say it kills me, but it doesn't. Like, it actually makes me really happy to spend that money. Even though I was like, we're public school people.
- [53:13]
Matt
I was a public school kid. It should. And like you're your, your personal. Financing it by calling it, you know, we're going to suck more money into the 529. But what you're paying for is your values and your. And your priorities today. Right? Like if you're using a lot of those dollars to go towards that and that's okay.
- [53:29]
Joel
That's my craft beer equivalent. That cost a lot more than this ipa. There you go.
- [53:32]
Matt
And that's. I think that's totally fine. In a similar way, like I don't have again, like, we've been at this for so long that you look up and you're like, wait a minute, how much money do we have set aside? Like not only in retirement accounts, but other investment accounts. And it's just impressive what you can do by doing the hard, fiscally responsible thing year after year. And I have very few, like, serious financial goals. Like my. I mean, we talked about this years ago, how we're like coast fi. But like, I mean, Kate and I were financially independent. To what extent it varies on what we choose to spend our money on.
- [54:06]
Joel
Right?
- [54:06]
Matt
Like, you can't, you know, we can't. I can't pick up some expensive hobby.
- [54:10]
Joel
If you develop those caviar tastes, maybe.
- [54:12]
Matt
Then maybe I'll work for another year. But like, but that speaks to just a different approach to, towards retirement as well. Like, we're not. I'm not interested in kicking back and doing nothing and just relaxing and going and playing golf. If I pick up golf, I do have to work for another two years because that's a really expensive sport. No shade.
- [54:26]
Joel
It takes a lot of time too.
- [54:27]
Matt
If you like to play golf.
- [54:29]
Joel
I have a buddy who plays every Friday. And I'm like, that's good.
- [54:31]
Matt
All right, bud, go for it. No, no hate there. But similarly to you, like, I think about lifestyle and some of the different things I want to achieve in my life, being able to pour into relationships. And I feel like I've done that really well with, with my wife. I mean, we've done a whole lot this past year where we've instituted regular things that grow and where we feel more connected than ever. And it's. Honestly, it's amazing. Same. Same with the kids, but even beyond that, other friends. And I think that's not something I've done as good of a job on over time. And you look at the Harvard Happiness Study, all right, it's like the long. It's the longest standing longitudinal study on happiness and the number one thing, the quality of close relationships. And oftentimes we don't have time for relationships because why? What do we spend two thirds of our life doing half of our waking hours doing, Joel? Working oftentimes to pay for the things that we've chosen to purchase or that we have financed. And we're not putting our efforts and our time towards the things that are going to actually bring us true happiness. And so for me, that's something. Honestly, like, that's more of a priority. For me, it's less the financial. We're pretty comfortable. I'm still going to continue to work because I love doing this podcast with you. Don't you folks worry about the feed going cold? Even if I let it go cold, I don't think you would let it go cold, Joel.
- [55:48]
Joel
I still have things to say, Matt.
- [55:50]
Matt
Me too. Me too. As evidenced by this rant.
- [55:53]
Joel
But more than anything, we have a community that, like, we care about.
- [55:56]
Matt
Yes, we care. We want folks to make some, like, some of the things that we've been able to experience over the years. So I want everybody listening to also be able to experience that and share in the joy of the optionality that you've purchased for yourself.
- [56:07]
Joel
Yeah, I feel like this is the perfect way to end an episode for the new year. I feel like there's so many other things we could toss in here, but we're not. We're going to stop it there.
- [56:16]
Matt
And we'll say that for Wednesday or next Monday's episode.
- [56:19]
Joel
We will stick with out of Money, hit subscribe and just, yeah, please do ride with us. And if you have money questions, especially after listening this episode, you're like, I think I'm in this gear. What do I do now? Like, Please toss them our way. We'd love to take them. Next week, we'll be back to regular programming and answering your listener questions, but that's one of my favorite parts of this show and look forward to riding with you this year.
- [56:41]
Matt
Let's do it, man.
- [56:42]
Joel
Should we get back to the beer real quick?
- [56:43]
Matt
We should make it quick. I just noticed that we are over. Or we're like, right at an hour, which I can't believe we went that long. I know, but when you've got stuff.
- [56:50]
Joel
To say and when you're having fun. Yeah, I say this IPA from Burial, it was like, classic. It was like a low key IPA from one of the goats. It was not, like, overly ridiculous. Some of the burial IPAs are just, like, so hoppy that makes your brain melt. I would say this one did not.
- [57:06]
Matt
Quite hit that level, but yeah, this one kind of had, like, the juicy hop ness going on. Like, this reminded me of a classic New England hazy ipa. Like, it had the hoppiness going on, but it was more like a. Like a earthy hoppiness mixed with some of that. Some of that juice. And I. Part of me wonders if we let this one sit too long in the fridge. Oh, maybe from last year. Like, it almost tastes. Does it taste a little bit old to you? IPAs you want to drink as fresh as possible. And this is one that almost had some almost like, metallicy kind of flavor, you know, like. Like canned fruit juices, like the giant can of dull pineapple juice. Like, it's kind of metallicy, it's kind of tinny.
- [57:44]
Joel
I love that flavor. For some reason.
- [57:47]
Matt
You should be sitting on all your classics.
- [57:49]
Joel
Yeah, I should be.
- [57:50]
Matt
I feel like it had a little bit of that, but honestly, it didn't detract too much at all from the overall enjoyment.
- [57:56]
Joel
Yeah, we'll keep drinking good beer. Keep.
- [57:58]
Matt
I got to enjoy it.
- [57:58]
Joel
Yeah. All right, that's going to do it. For this episode. We'll have links to some of the resources we mentioned up on the site@howtomoney.com you know it.
- [58:05]
Matt
And until next time, best friends out. Best friends out.
- [58:23]
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