Podcast Summary: Money Guy Show – "Are You Worse Off Financially in 2025? | Ask Money Guy"
Release Date: May 7, 2025
Hosts: Brian Preston and Bo Hanson
Description: Empowering listeners with confidence in wealth building through simplified financial strategies. The Money Guy Show delves beyond common sense to help you achieve your financial goals faster, allowing your assets to work for you so you can live a more fulfilled life.
1. Introduction
Bo Hanson opens the episode by posing a critical question: "Are Americans worse off in 2025?" This sets the stage for an in-depth analysis of the current financial landscape faced by Americans.
2. Gallup Survey Insights
Reby introduces a recent Gallup survey designed to assess the financial well-being of Americans. The survey posed two questions:
- Current Financial Status: Are you financially better off now than you were a year ago, or worse off?
- Future Financial Outlook: Do you expect that at this time next year, you'll be in a better financial position or worse?
Bo Hanson shares the survey results:
- 38% felt better off financially.
- 44% felt worse off.
- ~20% remained neutral.
"The spread between the better and the worse is a negative 6%,” Bo Hanson remarks at [02:23].
Despite the seemingly negative net result, Reby and Bo emphasize the importance of contextualizing these numbers within broader financial trends over the past decade, particularly post-pandemic. They suggest that 2025 might be a year where the financial sentiments of better-off and worse-off Americans are converging, indicating a potential stabilization.
3. Comparing General Polls to the Money Guy Community
Highlighting a significant disparity, Reby points out that within their live poll, an impressive 74% of respondents feel financially better off than the previous year. This contrasts sharply with the general Gallup survey, underscoring the effectiveness of their financial strategies among listeners.
"You're more likely to be in good company here, surrounded by people who make sound financial decisions," Reby notes at [36:19].
4. Financial Order of Operations
Central to the episode is the introduction and reinforcement of the Financial Order of Operations (FOO), a nine-step process designed to guide individuals in managing their finances effectively.
Key Steps Highlighted:
- Have a Plan: Establish a comprehensive financial plan.
- Track Your Progress: Regularly monitor financial goals and progress.
- Emergency Reserves: Maintain adequate funds to cover unforeseen expenses.
Reby emphasizes, "If you can have a plan in place, you are automatically putting yourself far ahead of your peers," at [05:04].
Bo Hanson adds, "We literally have written the book on how, what to do with your next dollar," reinforcing the structured approach the show advocates.
5. Handling Financial Setbacks
One compelling segment discusses managing financial setbacks, such as unexpected medical emergencies that necessitate dipping into emergency funds.
Kelly P. shares her experience: "We were on step six, then had an ER and hospital stay needing us to dip into emergency reserves. Now we're back on step four. So what's the best way to rebuild?" at [14:58].
Reby and Bo provide actionable advice:
- Reassess Emergency Reserves: Determine if the existing emergency fund suffices or needs adjustment based on the new circumstances.
- Focused Rebuilding: Prioritize restoring the emergency fund before resuming other financial goals.
"If what you're trying to do is do all of the steps at once, what you're likely going to have is a suboptimal sub efficient outcome," Reby advises at [17:31].
6. Audience Q&A Highlights
The hosts engage with a variety of listener questions, offering personalized financial advice. Notable discussions include:
a. Cash Reserves and HSAs
Robert S. asks if an HSA should be counted as part of his emergency fund.
- Reby: Clarifies that while HSAs can cover medical emergencies, they shouldn't replace a dedicated emergency fund for non-medical unexpected expenses.
- Bo: Emphasizes that emergency reserves should stand independently to avoid running cash reserves too lean.
b. Market Timing and Investing Strategies
Vegas questions the wisdom of selling into cash before a market dip and when to re-enter the market.
- Reby: Reframes the question to focus on emotional strategies like dollar-cost averaging to mitigate the pitfalls of market timing.
- Bo: Warns against behavioral traps, advocating for consistent investing regardless of market fluctuations.
c. Savings Rate for High Earners
A listener inquires why income over $200k should not count the retirement match in the savings rate.
- Bo: Explains that high earners may face unique financial responsibilities and risks, necessitating a higher personal savings rate beyond employer matches.
- Reby: Agrees, highlighting the importance of independently building assets to ensure financial security.
d. Handling Student Loans vs. Savings Goals
Paul seeks advice on prioritizing savings for retirement and home purchase against repaying parent-sponsored student loans.
- Reby: Suggests evaluating loan interest rates to determine repayment priority, advocating for targeting higher interest debts first.
- Bo: Recommends balancing debt repayment with long-term savings, scaling financial strategies as income and responsibilities evolve.
e. Investment Choices: Small Cap vs. Large Cap Funds
Jay Z asks whether to allocate a portion of his portfolio to small-cap or large-cap growth funds for a 10-year horizon.
- Reby: Encourages diversification tailored to individual risk tolerance and financial goals rather than making a definitive choice.
- Bo: Advises maintaining a balanced approach, integrating both small-cap and large-cap investments based on personal financial profiles.
7. Community and Support
Throughout the episode, Reby and Bo underscore the value of the Money Guy community. They highlight the importance of surrounding oneself with like-minded individuals who prioritize sound financial decisions.
"We live in a world where everyone assumes, if you're not making half a million dollars a year, you're not doing it. That's not reality," Reby asserts at [36:00].
Listeners are encouraged to engage with the community through various platforms like Reddit and Facebook groups, fostering an environment of mutual support and knowledge-sharing.
8. Key Takeaways
- Contextualize Financial Data: Individual financial experiences may differ significantly from broader surveys. Personal strategies can lead to better outcomes.
- Structured Financial Planning: Adhering to a systematic approach like the Financial Order of Operations can streamline wealth-building efforts.
- Flexibility in Financial Strategies: Life events may necessitate adjusting financial plans. Being adaptable ensures resilience against setbacks.
- Avoid Market Timing: Consistent investing and emotional strategies are more effective than attempting to predict market movements.
- Prioritize High-Interest Debts: Addressing debts with higher interest rates can free up resources for long-term financial goals.
- Leverage Community Support: Engaging with supportive financial communities can enhance personal financial management and decision-making.
9. Conclusion
Bo Hanson and Reby wrap up the episode by reiterating the importance of a well-structured financial plan and the support systems available through the Money Guy community. They invite listeners to explore further resources on their website and consider professional financial advisory services to navigate complex financial landscapes effectively.
"There is a better way to do money," Bo Hanson concludes, emphasizing the show's commitment to empowering listeners with actionable financial strategies.
Disclaimer: The Money Guy Show is hosted by Brian Preston and Bo Hanson, partners with Abound Wealth Management. All information provided is for informational purposes only and does not constitute financial, tax, investment, or legal advice.