Everyday Investors Are Beating Fund Managers (Copy Their Strategy)

Summary

Money Guy Show - Episode Summary

Episode Title: Everyday Investors Are Beating Fund Managers (Copy Their Strategy)
Hosts: Brian Preston & Bo Hanson
Date: May 13, 2026

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Episode Overview

This episode tackles one of the most persistent myths in investing: that professional fund managers consistently outperform the market. Instead, Brian and Bo share that everyday investors—in particular, those who follow simple, disciplined strategies—are often achieving better outcomes than the pros. The hosts focus on behavioral traps, the importance of staying the course, the power of dollar cost averaging, and how to make practical, common-sense moves to build long-term wealth. The discussion is rich with real-world examples, data, and actionable advice.

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Key Discussion Points & Insights

1. Why Average Investors Underperform (01:03 – 03:56)

• Most people view investing as stock-picking or market timing; however, these strategies rarely work for the average investor.
• Behavioral pitfalls:
  • Loss aversion - Investors flee during downturns, often missing recoveries.
  • Herd mentality - Following the crowd during times of fear or greed usually leads to poor decisions.
  • Overconfidence - Many overestimate their ability to beat the market.
• Professional fund managers are not immune. Over 15 years, 90% of active managers underperformed the S&P 500 (per SPIVA data).

"If you were an investor, you likely would have been better off just buying the market, buying the index, buying the S and P instead of hiring a professional to do that part for you." – Bo Hanson (03:12)

2. Always Be Buying & Dollar Cost Averaging (03:56 – 06:10)

• The core strategy: Automate investments, keep buying regardless of market headlines, and remove emotion from the process.
• The power is in "slow and steady"; eventually, exponential growth compounds your wealth.

"If you can set it and forget it and always be buying, that's what I love about that strategy. It really doesn't matter what's going on in the economy, ... it's going to help you start building wealth the right way." – Brian Preston (03:56)

3. Real-World History: The Great Depression (04:24 – 05:54)

• Even during the worst of times, such as the Great Depression (1929-1954), a disciplined investor reinvesting dividends achieved an average annual return of 11.7%, despite the Dow being flat over 25 years.
• Key message: Time in the market > Timing the market.

4. Modern Example: Reacting to Bad News (06:10 – 07:26)

• Fear-driven reactions to negative news (e.g., 2026 declines in consumer confidence) can cause investors to miss major rebounds.
• After a major 2026 low in sentiment, the market rebounded 14.3%. Those who panicked missed out.

5. Key Takeaways: Don’t Outsmart Yourself (07:26 – 08:17)

• Stick to simple, repeatable strategies:
  • Always be buying.
  • Avoid analysis paralysis.
  • Maintain consistent behavior despite the news cycle.

"It's that, yo-yo...you're the investor who every day the stock market's going up or down, but every day you're also walking higher and higher up a mountaintop of a growing economy." – Brian Preston (07:26)

6. The Wealth Multiplier Calculator (08:17 – 09:10)

• The hosts mention their online tool to visualize compound growth: MoneyGuy.com/resources.
• No finance degree needed—let time and discipline work for you.

7. Live Q&A Highlights (Selected)

Home Financing & PMI (11:15)

• Should you put extra payments toward removing private mortgage insurance (PMI)?
  • If before closing, try to get up to 20% down and avoid PMI altogether.
  • If after closing, often appreciation will eliminate PMI within 1-2 years; prioritize investing (Roth IRA) over accelerated PMI payoff.

Overtime & Savings Rate (14:39)

• Save 25% of gross income—including overtime—unless working overtime specifically for a near-term goal.

"Whatever your gross income is, we want you saving 25% of that amount." – Bo Hanson (14:57)

Big Life Experiences (20:36)

• Should you feel guilty about spending on a once-in-a-lifetime family experience?
  • If you’re on track elsewhere, prioritize memories and fund the trip responsibly.

"Money is just a tool to let you focus on what really matters. It sounds like time with your dad. I'd find a way to make it happen." – Brian Preston (23:41)

Investment Choices Across Account Types (26:26)

• For tax-advantaged accounts like HSA, 529, and Roth: similar index fund strategies often make sense, adjusted for timelines (e.g., 529 shifts assets as tuition approaches).

Front-Loading Investments & Employer Match (30:03)

• Can you slack after maxing contributions early in the year?
  • Only if your employer’s plan has a “true-up” provision and you won’t miss out on matching funds.

When to "Graduate" From Target Retirement Funds (46:26)

• Once your portfolio grows, move from all-in-one funds to customized allocation for optimal tax efficiency and tailoring to your needs.

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Notable Quotes & Memorable Moments

• On professional managers' underperformance:

  "According to Spiva, over the last 15 years, 90% of active managers underperform the S&P 500." – Bo Hanson (03:12)

• On discipline vs. news headlines:

  "If you would have acted on, oh, things are scary, things are bad, things are frightening, things are uncertain, then there's a really good chance you would have actually missed out on this uptick of 14% since that point." – Brian Preston (07:16)

• On complexity in investing:

  "You do not need a finance degree...to capitalize on allowing your money to work harder than you do." – Bo Hanson (08:27)

• Behavioral insight:

  "Don't outsmart yourself. And don't overthink this." – Brian Preston (07:26)

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Rapid Fire Q&A (40:28 – 49:34)

A high-energy segment where Brian and Bo answer quick-fire, listener-submitted financial questions (no “it depends” allowed). Topics included:

• Fixed index annuity suitability (when rates are high/risk-averse retirees)
• Handling overtime pay (save/invest 25%)
• Participating in employee stock purchase plans with a 5% discount (generally worth it)
• Investing for 5-year goals (high-yield savings/money-market; maybe a small part in index funds)
• Combining old retirement accounts (depends—see their flowchart at moneyguy.com/resources)
• How to count daycare in your savings rate (stay disciplined on gross income target, but give yourself grace during high-expense seasons)

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Fun & Personality Moments

• Banter about feet in beach photos, behind-the-scenes content meetings, and personal “money vices” (theme parks, gadgets, convenience, cruises).
• Transparent answers on when “fire” (financial independence, retire early) really happens with their clients: most retire before 65, but few truly "tap out" early, instead choosing purposeful work or sabbaticals.

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Important Timestamps

• Opening discussion: Behavioral pitfalls – 01:03
• SPIVA data: active manager performance – 03:12
• Great Depression illustration – 04:24
• Recent market headlines vs. actual returns – 06:10
• Key takeaway: Always be buying – 07:26
• Wealth multiplier calculator – 08:17
• Q&A: Home buying & PMI – 11:15
• Q&A: Overtime savings – 14:39
• Q&A: Big family experience cost – 20:36
• Rapid Fire Q&A – 40:28
• ABLE account deep dive – 59:12

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Resources Mentioned

• Wealth Multiplier Calculator: moneyguy.com/resources
• ABLE account overview & resource: ablenrc.org
• Free eBook for families with special needs: moneyguy.com/resources
• Financial Order of Operations deep dive: learn.moneyguy.com

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Closing Thoughts

Brian and Bo hammer home the point that everyday investors beat the pros not by being smarter, but by being more disciplined, avoiding behavioral mistakes, and sticking to simple wealth-building habits. Their approach focuses on staying invested, removing emotion, and letting time and compounding do the heavy lifting. The practical, real-life questions showcase how these principles work for people at every stage and income level.

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Recommended if:
You want practical, actionable, and psychologically-savvy guidance on investing that works in real life—not just theory. This episode is loaded with wisdom, humor, and strategies you can put into action today.

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For notes, resources, and calculators, visit moneyguy.com/resources

Transcript

[A]

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[A]

What we're going to explain, what we're going to share with you today is so simple in theory, it's so simple in thought. And yet behaviorally it becomes so, so difficult. And so many investors, professional or otherwise, actually screw this up all the time.

[B]

Well, first thing, when people find out what I do for a living, I think they just think we sit around and do stock picking or market timing. So I always say, when's a good time to invest in the financial markets? And I'm always like always be buying. That's it's always a good time to be an investor.

[A]

Yep. So I think yesterday was a good time to invest. I think today is a good time to invest and tomorrow's a good time to invest. But why do a lot of people not feel that way? Well, if you look at the actual data, the average equity investor historically has underperformed the overall market by 5%. And so you begin thinking, okay, well everyone says investing is so amazing, so wonderful, so incredible. But when you look at the average investor, they actually do pretty poorly. But it has a lot less to do with the market and a lot more to do with the actual investor themselves.

[B]

Yeah, so let's get into some of these behavioral signs things. There's terms like loss aversion. What this means is, is people really outsmart themselves. Fear driven decisions. You know, people see the stock market get beat up a little bit and they start looking for the exits about as fast as they can. They, they sell during the worst possible times that they should not be selling.

[A]

Another thing that we often see investors do is they begin to hurt just because something exciting has happened or someone else told me That I should do this, whether it be positive or someone else told me I should not do this, whether it be a negative thing, they end up moving in a herb, falling into a pack. And oftentimes, if you are greedy when others are greedy and you are fearful when others are fearful, it's not going to lead to the best outcome or best result.

[B]

And then let's not underestimate the very, very concerning overconfidence that most of us humans have.

[A]

Yep.

[B]

Where we look at ourselves and we overestimate our ability to predict what's happening in the market. I think we've created a system that's going to make things better than your typical peers.

[A]

Now here's what's really interesting. This isn't just for small investors. This isn't just for everyday retail investors. Again, if you actually look at the data, according to Spiva, over the last 15 years, 90% of active managers, 90% of folks whose job is to go out there and get a return in excess of a benchmark in order to justify their fee, 90% of active managers underperform the S&P 500. What that means is that if you were an investor, you likely would have been better off just buying the market, buying the index, buying the S and P instead of hiring a professional to do that part for you. Over the last 15.

[B]

Yeah, and I kind of begin with the end in mind. I already kind of gave this away. Is that this is why we absolutely love dollar cost averaging. If you can set it and forget it and always be buying, that's what I love about that strategy. It really doesn't matter what's going on in the economy, the geopolitical world, it's going to help you start building wealth the right way, which is slow and steady. And then one day the exponential growth is, takes so much traction, you look back, go, how did I get here? Yeah.

[A]

And we get this. But okay, this is theory, theory, theory, theory, theory. All right, what about in the real world? How does this actually play out? Well, we love to show this illustration because I think it paints the picture quite vividly. If we think about the history of the stock market and specifically we think about one of the most significant, most drastic downturns we have ever seen. It was the Great Depression where if you look at the 25 year trading period, the market, the Dow Jones, it closed at 381 on September 3rd of 1929 and then it closed at 383 on November 23rd of 1954. So that's a $2 increase over a 25 year period. Well, if you were an investor at this time, you might be thinking, oh

[B]

well, that's not even a lost decade. That's like a lost 20 plus years,

[A]

like a lost working career. Why on earth would I ever invest? Why would I participate in a market where it's possible for the market for 25 years to be no better than it to end no better than it started?

[B]

But think about this. If you were just doing the always be buying or dollar cost averaging, where systematically you were buying into this volatility and you were reinvesting the dividends and so forth, would you be surprised to learn that during this crazy period, this 25 year period where the market literally was flat, it only made $2, you had an average annualized rate of return of 11.7%.

[A]

That's right.

[B]

That's because your behavior was the all terrain vehicle. It was buying while things were going down, you were still buying. While things started to recover and had a sputter start but then went back down, you were still buying. You didn't let that distract you. You will be rewarded if you can stay the course.

[A]

But I can already, Brian. I can already hear the comments coming in. Guys, guys, guys. You can't. You can't talk about the Great Depression. That was almost 100 years ago. That's an old school idea. That's an old school thing. Well, this same thing can actually happen and does happen right now, today. If we just think about the year 2026 so far, right? If we think about the way the market performed in the first quarter, if you were following the headlines, if you were allowing yourself to fall into this loss aversion mindset, if you were allowing yourself to fall into the herd mentality, you might have recognized that on March 30th. And here's a headline. The American consumer confidence hits a 2026 low as geopolitical turmoil and inflation reemerged.

[B]

Oh, no.

[A]

Scary, scary, scary. Bad, bad, bad. Oh, oh, oh. And yet, if we actually look at what the market has done since that time, since consumer confidence was at the lowest part of the year, it's actually made 14.3% since that time. If you would have acted on, oh, things are scary, things are bad, things are frightening, things are uncertain, then there's a really good chance you would have actually missed out on this uptick of 14% since that point.

[B]

So let's give you the rubber meets the road moment here. What's the key takeaways? The big thing. Don't outsmart yourself. And don't overthink this. This is one of those things where. Where if you just have this always be buying, set it and forget it mentality, you get to take out all the other noise. It's just. That's why you've heard me do the analogy. I always think it's. When we talk about volatility, I say it's that, yo, yo, you remember, you're walking. You're the investor who every day the stock market's going up or down, but every day you're also walking higher and higher up a mountaintop of a growing economy. So if you can just stay the course, you. You don't have to drown yourself in all the information that in this new modern world kind of keeps us and does analysis paralysis and all these other things where people just don't fall into the. To the good behavior that actually builds wealth in the long term.

[A]

Yeah. When it comes to building wealth, we believe that time in the market is way more viable than timing the market. And if you want to see just how powerful that can be, I want you to go to moneyguide.com resources and. And check out our wealth multiplier calculator. You can literally put in your age, put in the amount that you have invested, and you can see, okay, what does every dollar I invest or what does every dollar that I have invested up until this point have the opportunity to turn into by the time that I reach 65, by the time that I reach 55. And it can show you just how powerful your dollars can be. It does not have to be more complicated than that. You do not need a finance degree. You do not. To be some astute investor, to be able to capitalize on allowing your money to work harder than you do.

[B]

And with that, let's roll it over to our.

[A]

I thought surely you had some. I was thinking another dime was coming. I thought you had something else.

[B]

I mean, I feel like we've been dropping some dimes today already. But if y' all could have seen the content meeting we had this morning. There was all kind of stuff in there that I'm like, why do we not have a camera in this? But with that, that's probably a great transition. Over to our creative director, Ribi.

[A]

Now, that's almost a transit. That's an interesting. What if we put a camera? Just because these are our people, I'm gonna ask them, if we put a camera in our content meetings and you guys were part of the process of us developing content, is that something that you would watch, participate in. Can we get a poll? Can we do a poll on that? I'd be.

[B]

So they're gonna think that we planned that, but I really was. I know we brainstormed. We talk about this, but I love that Bo is actually like, what do you say? Bring it up. Why not? And throw it out there.

[A]

If you say because we do love. We love that we get to sit here. We love we get to do this. We love that we get to load you up so every Single Tuesday at 10am in addition to sharing the stuff that we've put together behind the scenes, we love speaking to the things that you guys care about. So if you have a question right now, we have the team out in the wings collecting your questions because we do believe there's a better way to do money. Get your question in the chat with that creative director, Ribe. I'm gonna throw it over to you.

[C]

Yes, I've got some questions queued up and it is these people's lucky day because it is Tumblr day. Woo.

[A]

I want to throw that out there

[C]

we go ahead of time. So drop your questions in the chat box.

[B]

Why do we love the tumblers is because they transform from koozie to Quark. Quark. Quark, Quark, Quark. You don't even have it out here. Bo.

[A]

They didn't put. Mine's not here.

[B]

Oh my gosh. To a tumbler. You can actually keep your beverages either hot or cold.

[A]

I don't.

[B]

My Vanna White didn't show up today, so I'm sorry, you don't get to see it in that I'm lacking.

[A]

Normally. I have the three beverage setup here. I like to build my three buckets.

[C]

But he does have the other koozie, though, so I guess we'll cut him.

[A]

I do have another.

[B]

Ah, man. It's all right. It's all right.

[C]

All right.

[A]

Well, first question now I'm gonna water the whole show. Cause you said that

[B]

if this is a professional operation, you know, it'd be even that much better.

[C]

First question is from Ben K. He says, hi, MoneyGuy Show. I am 24 and about to close on a house.

[A]

Wow, nice.

[B]

Way ahead of the curve.

[C]

My estimated PITIA will be just under 25% of my gross income. Should I put extra payments until PMI goes away? Down payment is about 18% and loan is at 4.99%.

[A]

I'll read this again because I was caught on Pitia. Principal, interest, taxes, insurance, association fees. Oh, is that what it is?

[B]

That's what we were Thinking, all right,

[C]

in the wings, we were thinking that.

[A]

So that's going to be under 25%. Should I put extra payments until PMI goes away? Down payment is 18. Oh man, you're really close, right? I think it'd be worth, I think it'd be worth entertaining based on the size of the home that you're buying, what would it take to get 2% more? Like how much more capital would that be? And then I run the calculation, I figure, okay, If I do 20% down and I avoid PMI altogether, what's the change in payment? Am I going to take that savings and payment, put that money to work? Would that be worth the additional 2% that I had to save, had to put down on the house? I think being this close, I don't think it's a crazy mathematic to run.

[B]

But that's not the way he asked the question, Bo. He's saying that should he continue, I would assume after closing? Because I think what you're saying is if you can get the extra 2% before closing. But we all know even if he starts throwing extra money, there is an entire process. You have to reach out to the lender to get them to remove the pmi. And I'm here to tell you, I think that realistically, if we're post closing, it only takes a year to two years where all you're just the appreciation of through inflation, you're going to have 20% and still have to go through the exact same process. So if you're trying to tell me from a lifestyle decision, you're going to forego having a Roth IRA, a fully funded Roth IRA, versus going ahead and throwing extra dollars at 24 years of age on PMI. I'd rather you just let it happen naturally and go through the process in a year, year and a half, two years. As a matter of fact, you might want to go ahead and check in with your lender and say, hey, when is the first look back I can even have on getting PMI removed? Because they might, you know, that's another reason why that might work against you throwing extra money now is they might have a certain period of time before they even give you that look back option. And there's probably going to be a cost.

[A]

Yeah, and I'm hoping because 4.99% is a pretty good rate right now. So I don't know when you bought the home. I'm hoping they don't say so it

[B]

was about to close. So I mean you're, you still have the Potential if he could come up with the two. Oh yeah.

[A]

So he should.

[B]

Okay, that's not the way the question's written.

[A]

I'd still. I would scramble to find the two. I agree with everything you said and I would scramble to find the 2%. Or I do the math to scramble to find the 2%.

[B]

But if. What if he's closing next Friday,

[A]

I'd do the math to scramble to find the 2%. I don't know how much house it is. It depends on what that, how much, what the dollar figure that is.

[B]

There's a lot of. It's a good problem to have been.

[C]

Good problem to have. Ben, if you would like a tumbler, just email winneroneyguy.com we'd love to send you one since we answered your question. All right, next question is from Abra 6:2 2. It says say it with confidence.

[B]

Abraham 622.

[A]

There's no question. Thanks for the question but you read the question mark.

[B]

See, you just gotta be confident.

[C]

Confidently. Abra622 asks, Is there a money guy rule of thumb for how to handle overtime? I, I'm currently working around 60 hours a week. Should I save 25% of it, all of it? Should I use it on one off projects? What do you think?

[A]

Yeah, this is one of those things. That's why we love the 25% metric so much when we talk about it. We say 25% of your gross income. If you're a part time worker and you're only working half the time, it's 25% of the gross income. If you're an overtime worker working overtime, we want you to be saving 25% of the gross income. Unless you, you are working overtime in this specific season for a specific purpose. Then it might be like, hey, I'm going to take a few extra shifts and work a little bit extra overtime because I know that I want to save for that next car next. Whatever the thing may be, we still want you saving those dollars but you might be saving those for an in a short term to intermediate term goal as opposed to long term goal. But whatever your gross income is, we want you saving 25% of that amount.

[B]

So Abra, your question is, does the money guy have a rule of thumb on how to handle the overtime? The answer is yes. It's called the financial order of operations. What you should do with your next dollar is because you very well you're going to try to figure out am I in step four, am I in step five? And when you look at that then yeah, you say, hey, I've got extra money coming in. Exactly what Bo said. Run it through the filter of my trying to save and invest 25%. If you're by the way under 100,000 for a single individual, 200,000 for a married couple, you can take into account your employer's match with that money, you know, figure out and then yeah, load up that money, that overtime, let it fulfill what's going on with your army of dollar bills.

[C]

Good stuff. Abra6 to if you would like a money guy Tumblr just email [e-mail] See

[B]

I feel like I can throw in a few actually. We've done so many rapid fire segments that I think it's making us better. So I feel like we have to like let's put in some other stuff in there just because we're going to go end up making through 26 questions.

[A]

Do you have some other stuff that you want to put in there right now? Is that. Was that your lead into a tangent right there?

[B]

No, I mean the only tangents because I was, you know, I was at the beach last week which by the way, did y' all know if you got the newsletter? They showed my beach view but I found out that they cut out my feet. I guess, I guess they're trying to tell me that I have ugly feet. No, just they're obviously swimmers feet because I'm built like a swimmer. But. But they must be ugly feet. Very functional over form.

[A]

It's not an indictment on your feet. I just think that most people in their Saturday morning newsletter while they're drinking their coffee, they don't want feet as their first picture. I just don't think that's the thing. I think beach wasn't because you said us a beautiful picture of the beach, but all that we could see were the 10 little guys waving at us as opposed to the beautiful shoreline.

[B]

So. So just what's funny is perspective matters. So when I sent that message I was like, God, team didn't even respond to me. It's kind of rude that nobody liked my, my beach photo. And then I come in today when we're doing our team, when we're doing our content meeting and I found out y' all had the reason nobody was responding is because y' all huddled up and were making fun of my ugly feet. So I was basically being picked on behind my back.

[A]

You have wonderful looking feet. They're very functional feet. They're not bad looking feet.

[C]

Swimmer feet.

[A]

They're great feet. I just don't know that feet are what you want in your beach picture. You. You ever, like, gone to someone's home and you see this, like, beautiful beach landscape and it's this wonderful portrait up there. There's never feet and toes in it. And that's what I'm saying. I think that it's not you. You're.

[B]

Well, how would you know it's a photo from me, though, if I didn't put something, you know? Because if you just take only landscape photos, those are boring photos from vacation. If you put yourself in the photos, it's better.

[A]

Even if your feet weren't there, how are we gonna know it was you? No one's gonna identify you by your feet. Okay. You know how we knew the picture was from you?

[B]

My feet?

[A]

Because it came from. Because he said it. You know what I mean? We pretty much locked in on that one. All right, I want to be very clear.

[B]

I didn't plan to have that tangent, but that's. That's what was going on in the comments.

[A]

There were no derogatory comments made.

[B]

Oh, come on. Y' all were laughing about my feet?

[C]

No, no, it was more just that you. The feet were in the picture.

[A]

That was funny. If it was funny, maybe. What, do we have some in discord? Can we put the actual picture in?

[B]

No. Oh, I don't know if we need to do that.

[A]

Well, because I was gonna say, now

[B]

I'm a little self conscious about my feet.

[C]

You've been defeated, like, no, this is a great picture. And now you don't want us to share it.

[B]

Well, I mean, I don't know. Now that I found out that there's an issue with feet, I don't know that it's a weird.

[A]

There's not an issue with feet. It's just the be the picture. We don't want to detract from the picture.

[B]

All right. We've caught back up to being as slow as everybody anticipated.

[C]

So wait, are we putting it in money verse or not?

[A]

Because what I was going to say.

[B]

I don't care for the crew. Yeah, I would let y' all show my feet.

[A]

I thought the funniest part of the picture, though, is that the way the shadow cast, it looked like you were wearing a wetsuit. Like it. Like you had long pants on. It was a fantastic picture. We're so thankful that even while you're laying on the beach, you didn't have to be thinking about us, but you were. And you're like, you know what? I want the team to enjoy the view that I have right now.

[C]

So two things there. If you want to see the full picture that Brian is describing, go to moneyguy.com moneyverse and join our free Discord server. Then you can talk about personal finances.

[B]

You can see Brian's big toes.

[C]

And you can see Brian's big toes. Woo. Didn't think I'd be saying that. And then second of all, if you're not subscribed to our email newsletter. Cause if you were, you would have already seen part of the beach picture on Saturday morning along with a really nice write up about our why and getting to do what you want to do because of making good financial decisions. But go to moneyguy.com and you can subscribe to our email newsletter too.

[A]

You remember when you said we got so good at this?

[C]

Yeah, I know. You just, you were like, we're doing so good. Let's just, let's derail it a little bit. But now let's get it back on the rails. We have a question from Foo Fighter 66 up here.

[B]

Nice.

[C]

It says good morning Brian and bo. I'm 29 with one times saves. I think he means one times his income saves. And he's on step five. My dad, 65, invited me on a 5k moose hunting trip next October, likely his last. That's so sad. I don't like that we're already thinking through that. But he says I want to go, but feel guilty thoughts.

[A]

Go.

[B]

Also you got until next, next October go. I mean, so I would find out what the, how long you can stretch out the payments. But yeah, I mean, and then, and then also you know, look, you know your parents situation better. I mean, but tell them your concerns. But you're going to make it happen and see if there's essentially a dad scholarship too.

[A]

Dad, I really want to go, but if you could foot the bill. Is that a financial meeting?

[B]

I mean, look, as a parent who's got now a graduated from college daughter who's, you know, gainfully employed and I know I'm gonna have to bribe her to probably in, in the best possible way. I don't really mean it. She likes spending time with us. But I for sure will be doing nice things to try to help incentivize. Just like I helped her fund her initial Roth contributions when she was younger and starting in the workforce. I think there's nothing wrong with if your parents are in a good financial situation. Just statistically, typically the parents are in a better financial situation than you just starting out. So that's the only reason I'm not, I'm not trying to turn you into, you know, failure to launch. It's just one of those things that, that I thought was worth a conversation.

[A]

I just think far too often financial mutants, they miss out on some of the sweetness in life. They miss on things they can't go back on. Because the dollar figure when I see $5,000 moose hunting trip. I don't know your financial situation, but I'm going to argue that I would imagine 5,000 is, is not like an insurmountable cost overcome. Now, this is different than you said. Hey, I want to go on a $50,000 safari with my dad. Then we'd have to like pull the reins in. That's a little aggressive. But 5,000, depending on your circumstance, might be a very realistic thing where you're going to have the opportunity in the future to make more money, to save more money to be able to afford this trip. If this really is your dad's last hunting trip, you don't get to go back and have any more.

[B]

Well, here's. Let me put, let me bring this into a better perspective. Is that that's a big thing, like the big lifetime memory of, of blossoming memories because we're not going to be here forever. Let's start putting. Because that's a big thing. What small things can we do now to make this possible? Can you just take your, make your, you know, meal prep for the next three or four months to where all of a sudden, you know, every month you're saving an extra 2 or 300 bucks just because of the way you're structuring decisions, small decisions that you are already doing. You know, are there things that you can sacrifice in the short term that will help make this or cut the corner off of this to where now Maybe it's only $3,000 that's actually coming out of your savings or 2500 versus the full $5,000 because you're going to make some lifestyle decisions that make up for the rest of it.

[A]

Yeah, I'm just so I wouldn't miss the trip.

[C]

I wouldn't either.

[B]

You don't. Here's the thing.

[C]

He's saying he's. He's got. Already got one time his income saved, so he's slightly ahead of the curve. He's on step five, so he has an emergency fund. Sounds like you're employed. You know, I'm kind of like, you can make that happen. Yeah, we're not, we're like, we actually. Money is just a tool to let you focus on what really matters. It sounds like time with your dad. I'd find a way to make it happen that.

[B]

But I would. I would go turn over a few stones. What? I just.

[C]

I thought Bo was going to say something. He just looked like he was going to.

[A]

No.

[C]

Okay.

[A]

That was a look of affirmation.

[C]

Affirmation. Well, Foo Fighter 66. Thank you for the question. Enjoy the hunting trip.

[B]

Go get your tumbler and if you

[C]

would like to bring, you know, keep it on the moose trip while you're on your hunting trip. Just email winneroneyguy.com and we'd love to send you a moneyguy tumbler.

[A]

Where do you hunt from most? Canada.

[B]

Somewhere where it's cold. I don't know.

[C]

I guess I'm not a hunting expert.

[A]

The northern part of the United States I think have moose too.

[B]

I never killed a moose.

[C]

I don't know what permits and stuff are.

[A]

You ever seen a moose?

[B]

No.

[A]

I'm going to.

[B]

Only when I used to go to that crazy restaurant that had a fake moose that would talk to you.

[C]

Oh my.

[B]

It was just like a steak restaurant.

[A]

Oh, Stoney River.

[B]

No, it had some crazy. Had a different. I think they've grow out of business now. But there was a moose head that would talk to you every few minutes. No, it wasn't Bullwinkles. Thanks kids.

[C]

Oh my goodness.

[A]

I'm going to. I'm actually going to somebody in the comments.

[B]

I guarantee will know what restaurant I'm talking about that went out of business later this summer.

[A]

I'm going. I'm going to Canada for the first time and moose is on my list. I would like to see. I don't think I've ever seen a moose in real life. Lots of Rocky and Bullwigle growing up.

[C]

All right, well, we are gonna do another question but it is also going to be time for our rapid fire segment very soon. So get your rapid fire questions into the chat. If you're watching live, be sure to put RF at the front of your questions. So we know that you want it to be a part of that segment. And that'll be coming probably between the 30 and 40 minute mark. So stick around for that. All right.

[A]

Boom. Boo Creek.

[B]

There it is. That's it. I knew it. Somebody in the audience.

[A]

Cause they had one at Stonecrest. That was the one that we always went to.

[B]

The one I'd go. There was one in Fayetteville.

[A]

Georg Bugaboo cre. Thank you. Thank you, Paul Big.

[C]

I went with my analog nightmare that Was.

[A]

I remember they had one. It was part of the new mall development. I remember that.

[C]

All right, next question is from Gabib 1992. I'm sorry, I'm supposed to say it with confidence, but I didn't.

[A]

You don't think that's Georgia Bib?

[B]

Oh, Georgia bib. That's a good year.

[A]

By the way, how long is 1992

[B]

again, graduated high school.

[C]

The question says, when investing in different account structures like HSA 529 or Roth IRA, are you supposed to be invested in the same exact index funds throughout each account?

[B]

Depends on where you are in your journey. In the beginning, getting the money in the right account structures is more important. You know, just following the financial order of operations and just, you know, maxing out your Roth, setting up your 401k, all those things are more important than even the specific investment. So that's why we like broad index funds, whether it's the s and P500 or if you're even one of those people who wants to use an index, target retirement fund. But then down the road, as you build some wealth, you know, we usually around step seven of the financial order of operations, you'll start thinking about the three buckets and the efficiency of those investments because of the taxes at that point. But in the beginning, I wouldn't get caught up in that. I would choose a really good operating index fund and just let it rip.

[A]

I agree with everything that you said. You want my hot take?

[B]

Yeah.

[A]

You know, sometimes when you're taking a test and they ask a question and you jump on the answer real fast, but then when you read it again, you're like, whoa, this is a trick question. I think this is one of those. Because what's really interesting is the three account time. He didn't say like, hey, when investing in different account structures like 401k IRA, traditional IRA, Roth IRA, should you do it different? He actually laid out three different or she laid out three different tax free account structures. 529s are tax free. Health savings accounts are tax free. Roths are tax free. Which means that because they're taxed the same way, there's. It is likely that the types of indices, the types of investments you're going to use in those three specific type of accounts probably will be pretty similar. They probably will look kind of the same again depending on your timeline. Because the 529, as you get closer to needing the dollars would need to be dialed down a little bit.

[B]

That was the only one that I was going to draw attention to. But if you're a little different, if

[A]

you're early on your kids are not close to college age, I bet it's going to be a lot of low cost index funds across all three of those because they're all taxed the same way. I think it was a trick question.

[B]

Yeah, I like that. But I would add the color that this is why I like in 529s. Like because remember I think I'm somewhat of an expert now that I've had a daughter graduate college and we use the 529 to pay for it is that I like the age adjusted portfolios, the index variety. I was very fortunate that the provider of my 529s was using essentially index target retirement funds. And it was amazing how when we needed the money it was there. And I love the fact that how it annualized and grew over those years and those small, small contributions I made when she was a itty bitty baby turned out to be and blossom into a great 529 that helped pay for the first three years of college completely.

[C]

That is awesome. Well Georgia Bib 1992 if you would like a Money Guy Tumblr just email winner money guy.com.

[A]

i don't know if it was Georgia

[B]

Bib but I like it. Get creative with confidence and we're Georgia boys so you can you can highlight

[C]

the Georgia the Georgia Gab 1992. Knows who he is.

[A]

My nephew just graduated from University of Georgia this past.

[B]

Nice. Go dogs.

[A]

Dude, do you know how fun it is watching a new grad walk through the arch for the first time? It was, it was very sentimental. It was awesome.

[C]

It's a bulldog thing to say.

[A]

I'm about to say you wouldn't know.

[C]

No, I wouldn't know. All right, next question is from the BobbyB22. It says hi money guys. You talk about always be buying.

[B]

That's right.

[C]

If I can front load my 25 to 35% early in the year, can I take my foot off the gas to enjoy summers and holidays more? We'd still continue the 401k match.

[B]

Yes, Bobby. The only, the only curveball you have to watch out for is make sure your employer truly is going to give you that match. Is because we have actually seen plans to where they're structured where they don't actually do the match even if you front end load it. They cut off the contributions. We've seen that. So just make sure you do a little homework. But I'm okay if you because Statistically, it probably works out pretty good, you know, because eight out of 10 years, you know, you just have more money, more time for the money to work.

[A]

Yeah, I was going to say the only thing you're going to miss out on is if you're front end loading it consistently in the front of the year, you're going to miss out on some of the dollar cost averaging benefits.

[B]

Like I'm thinking that's true volatility.

[A]

Fourth quarter of 2018, you know, is a big opportunity to be buying. So if you have money going in every month, but does are you still saving the appropriate amount? If you're saving 25 to 30% in front end loading it so that you can take your foot off the gas later? Absolutely.

[B]

And then the behaviorally just know thyself is that make sure you really are turning the spigot back on every year. Because part of the set it and forget it that I like is, is that it kind of foolproofs you to a lot of the behavioral traps that we all fall into. And one of the ones when you're doing things from a structured timing standpoint is you just forget about it. You get busy and then all of a sudden a month or two slips through the cracks and you're like, wait a minute, I totally missed out on three or four months worth of savings. Just be careful with the behavioral stuff.

[A]

You talked about the true up provision. Did you say the name true up provision?

[B]

Because I didn't say.

[A]

Oh, okay. What you want to ask your hr if you're thinking about doing this, you want to ask, hey, do we have a true up provision? Meaning so long as I put in X percent of my salary, even if it's not going in per paycheck, will I still still get the employer match? If you, if your company does not have a true up they make you have to have money going in, you could miss out. So it's a really quick email to hr, Ask them, not all plans have them, not all plans don't have them. So you want to make sure you don't miss out on that money.

[B]

Yeah, I mean we don't, I don't know if we need to explain that, but it's basically they're going to just apply the percentage each paycheck.

[A]

That's right.

[B]

So if you front end load it, you're like, well, I got it all in there. But they might have only given that percentage off of each of those paychecks and they're counting on giving you the rest later. But if you don't have any money going into the plan. You just don't get it because that's the way they're matching is set up. And it kind of stinks when it's like that.

[A]

Oh, yeah. Because you miss out on free money.

[C]

Well, the Bobby B22, hopefully that helps you think through that decision. And if you would like to drink from a money guy Tumblr while you consider this, you can just email winneroneyguy.com and we will send you one as a thank you.

[B]

By the way, that was the most Beau and Brian thing ever. And the fact that I talk about the concept and you came up behind me and cleaned up the thing by saying, hey, did you make sure you actually use the actual professional word that represents that?

[A]

Well, I just said, I want.

[B]

I want because this is why we work together. Well, I found this peanut butter and jelly.

[A]

A lot of times people don't know the language. Like, oh, man, I got this great question I want to ask my hr, But HR professionals are often not financial professionals. And so even when you ask them the question, oh, no, no, yeah, we get a match, you want to be very specific because you want to make sure that it's like. It's kind of like artificial intelligence. The quality of the input will dictate the quality of the output. And so you want to make sure you're using the right vocabulary. So whoever asked them the question can get you the correct.

[B]

Because if you go and ask them, say, hey, if I'm getting. If I put 6% in, I'm getting the full match, right? Oh, yeah. Oh, yeah, you're good. We match here and be like, no, no, no. Let's get into the. The actual terminology.

[A]

That's right.

[C]

All right, next question is from SPLO603. How do I know when I'm close?

[B]

603.

[C]

That's it. How do I know when I move on from step six to seven? My wife and I don't make enough to fill every account, but we are doing 25%. Are we on step seven? And can you expand on step seven? I'm 24, married and with 195K.

[B]

Wow, that's pretty awesome.

[A]

24 married. One hundred and ninety five. That's. You were certainly out ahead of the curve, Brian. You actually wrote the book on this.

[B]

Yes.

[A]

You wrote the book on how to progress through this.

[B]

Yeah. The most improved chapter when I was doing the original version of Millionaire Mission was really step seven chapter after. I was like, man, that now hits a little differently. And by the way yes, I'm gonna go ahead and answer for sploss you I didn't put the T on there because that's not a tax joke. I won't make the squash joke sales tax joke but I can't help myself.

[C]

What a CPA. Am I right?

[B]

Listen, you are definitely in step seven is because the 20 we've had this question come up because there's a lot of people that will make under $100,000 that will never reach the 401k funding limit for the year but they have definitely reached the 25% savings rate especially if you include your employer match. So you should move to step seven which the whole purpose of hyper accumulation or step seven is now instead of you thinking in the because steps one through six are all very reaction or cause and effect meaning that we got to have emergency reserves to keep you from making desperate decisions. We've got to get the free money from your employer because it's just that valuable. You can't pay a bank 20 plus percent and expect to be successful. That's why step three is set up the way it is. Emergency reserves helps you get case you get unemployed. Tax free growth or tax favored growth in step six are just too valuable not to pay attention to. Step seven is the first one of the steps that you get to take a breath and say wait a minute, okay, all this has been cause and effect because of the tax policy or keeping myself out of the ditch. Now it's how are we actually going to use this money? And that's why you get to take a deep breath and think about what's the ultimate goal for this money? Do I have the right account structure that's actually going to let me use that money in that way? And and it's kind of a way for you to catch your breath, know how you're going to use the money before you start moving on to step eight, which is those, you know, prepaid expenses or abundance goals. And you once again get to work thinking about now how we're going to be using that money even if it's outside of, you know, boring stuff like steps one through six are.

[A]

That was a fantastic answer. If you want to know even more. Like if you'd like to know more, I'd encourage you. If you've not picked up a copy of Men in a Mission, it's a great read. You can read through that chapter, actually understand that. Or if you want to do a deep dive on the financial order of operations, you go to learn.moneyguy.com Go take the financial order of operations course and actually see, okay, this is what went into it. This is how it was designed because it kind of walks you through that level of detail for each one of the steps that we work through.

[B]

And remember when we did the food course redesign last year, we gutted the price on purpose because even though we made it much, much better and I felt like modernized and streamlined it, we gutted the price because we were trying to make it that much more approachable for everybody. We realized, hey, it's not about the money we're making off, it's more about getting more people in front of it. Exactly right.

[C]

That's great. Well, splo603 or splose603. Thank you so much for the question. Just email winneroneyguy.com if you would like a moneyguy tumblr before we get to our It Does Not Depend Rapid Fire segment. What are you looking at me for?

[A]

No, no, it's just. It's just us. You keep going.

[B]

You're great.

[C]

Okay. I was going to say we have a couple of really fun collabs coming up this week that I thought we should shout out, so I'm sure.

[A]

Tell me more.

[C]

Tomorrow, your episode with Marriage, Kids and Money is going to come out where you talk about fire.

[A]

It was awesome.

[C]

So go check out Marriage, Kids and Money with Andy Hill. And then I believe on Sunday your episode with Iced Coffee is coming out where you guys respond to some portfolio. I mean, you guys talk about so much stuff about investing, you know, because

[B]

we went on Iced Coffee Hour again. They came in town, saw us. Jack and Graham actually let us see their portfolios and got our opinions on them.

[A]

So what do you guys think about these?

[B]

If you want to see what we did. And I mean, look. And Bo was nice to him, but he also pointed out some. Some. Some blind spots that they might have.

[A]

They asked for our opinion of what they're both doing financially in their portfolios, and we gave it to them.

[B]

What's funny is that we're still getting texts from. From specifically Jack. He's very hot and heavy on a specific strategy. It will be interesting to see how it plays out.

[C]

Yeah. So really good stuff coming up from two fellow financial creators. And actually we have a. We have a few collabs coming up. I won't give them away yet, but we'd love to hear who you think we should collab with next.

[A]

Oh, that's a great.

[C]

It's always fun to meet different people in this space. Even with different ideas, sometimes it's just fun to discuss and get to know them. And a lot of the time you guys have given us some really wonderful ideas. So let us know who we should meet and collaborate.

[B]

I would love because, you know, there's things like I think about content creators that like every Saturday I watch Disney Food Blog with AJ I've been trying to forever trying to figure out what's collab thing can I do with her, but I couldn't, I couldn't figure out how to make it work because I don't, I don't know. But there's, but I would definitely be open for us coming creative collaborations that we should be doing because it's good for everybody. You know what's great about collabs is that you get to, you guys get introduced to somebody else who could hopefully add value to you. But then also we get introduced to their audience as well. So if you have any creative ideas, we're always open to thinking about those things.

[C]

Yeah, it's fun to hear what you guys are thinking. So I just wanted to throw that out there. All right, it is now time for our It Does Not Depend Rapid Fire segment where Brian and Beau collectively have 30 seconds to answer your financial questions and they cannot say the phrase it depends or they are out or something like that. And then at the very end of the rapid Fire segment, we will move on to our maybe It Does Depend segment where they can say any of the things they felt like they just really needed to say but didn't have time to. So that is what we're going to do. We are going to put 30 seconds on the clock and after I ask the first question, we will be off to the races. Are you guys ready?

[B]

Yeah.

[A]

You want to start?

[C]

Why do you always look nervous?

[B]

The first question.

[C]

Okay.

[B]

Kind of like you give, you give it, you know, you get a shot from the doctor. It only hurts for the first second.

[C]

Oh, okay.

[A]

Like the first shot only hurts. I was like, how many shots you get when you go, what are we. Are you going first or am I going first?

[B]

I'll go first. Get it out of the way.

[C]

Okay. Question one. Is there ever a case for investing in a fixed index annuity? If yes, when would this be?

[B]

Yeah, when interest rates are really above average high and you'd like to protect a chunk of the portfolio because you don't have a pension or some other cash flow thing that takes out the

[A]

volatility for very super risk averse investors who are terrified of any sort of market Loss. But they need to turn a pot of assets into an income stream. Annuities, specifically immediate fixed annuities can be solutions for people in that scenario.

[C]

Next question. What's your money Vice? Something you enjoy spending on without a second thought.

[A]

Convenience. I am at the stage in life where if I can spend some money to have something done or something done on my behalf or something done more efficiently. I love the idea of convenience. I love of being able to buy back my own time. Crud.

[C]

Gadgets.

[B]

Yeah, but what's the last gadget I bought?

[A]

Your watch?

[B]

Oh yeah, I guess. Okay.

[C]

You do love a good gadget.

[B]

I buy gadgets.

[C]

We're gonna go gadget and that's.

[B]

It was a splurge.

[C]

Time is up.

[A]

All right, how about experiences?

[C]

How about going to theme park?

[A]

How about going on cruises?

[C]

We'll come back to that one.

[B]

Oh, that's what I should. I should say.

[C]

No, we'll come back to it. We have. Time's up. Okay, next question around what percent of your clients are on the fire path? What is the average retirement age? You see, what's it like in the real world?

[A]

I will be honest. Much fewer of our clients are true fire like financial independence, retire early, do nothing. We do have a lot of fine people because they are such diligent savers that when they get into their late 40s, mid-50s, they now have the opportunity they can either leave the job they have been doing or focus on their next endeavor.

[B]

Yeah, I would say, I mean most of our clients are before 65, which is traditional. So I think a large percentage or before 65 we don't have. I can't think of any under 50 though.

[A]

I have a. I have a handful.

[B]

Okay, never mind. Disregard.

[C]

Next question. Is Roth 401k always the move if you will receive a pension when you retire.

[B]

I love Roth iras because of also assuming, you know you've taken into account all the tax implications. The because of the legacy, the tax free growth. There's a lot of power with all Roth accounts.

[A]

I don't like all. Whenever we say that I would say if you're in a very high tax bracket, even if you have a pension, it would behoove you to save on a pre tax basis. Especially from the 30% plus tax bracket. You get 30% tax savings this year even if you are going to have pensionable income later on in life.

[C]

All right, next question. Is it worth it to participate in my company stock purchase plan if the discount is only 5% and the money is held for three months with no interest.

[A]

How much free money is not enough free money? You know what I mean? Because 5% is still free money and if you hold it for three months, it's still a relatively minimal amount of period. It does sound. Without knowing the other circumstances, I would say the ESPP is likely still falling into step two of the financial order of operations.

[B]

Well also that 5% discount is it before because a lot of times it's the lower of either the beginning of the quarter quarter or the end of the quarter. That might be enough juice to really push it over.

[C]

You guys are getting very good at this. Well done. Crushing it.

[A]

Whatever we're having, there's we got a bunch of it not depends to double back on. I mean I do have two lists

[C]

so if there's more, let me know.

[A]

I can't talk.

[C]

All right, next question. Where is the best place to invest my money if I need to access it in 5 years?

[B]

I mean 5 years is right there on the line. That's probably going to be a balanced of some index funds but a lot of liquidity so that you can offset the, the any crazy things that happen. From a timing perspective.

[A]

I still think that right now the most attractive cash holding are high yield money market mutual funds. Most of them are paying somewhere between 3.4, 3.7% inside of five years. That's where I would hold my cash. It's where I am holding my cash

[C]

with two seconds to spare.

[B]

There's more to add on that one potentially.

[C]

All right, I'll make a note.

[B]

But. But it's hard because that gets into financial planning.

[C]

Oh my goodness.

[B]

You guys might as well say it depends.

[C]

Fired? No. Okay, next question. Step eight. I'm in step eight. Have 220k in a brokerage intending to fund 100 to 150k of college starting in seven years. When and how should I start de risking?

[A]

Just like we talk about putting money to work by dollar cost averaging. Whenever I know I have some sort of goal that's going to happen. I like the idea of reverse dollar cost averaging. So if I think that I've got seven years to do this, I may begin slowly backing down the risk on monthly, quarterly, annual. You figure out the cadence basis to get to that thing by the time I get there.

[B]

The only other thing I was going to say without saying the dirty word we're not allowed to say is make sure you really are in step eight. That's where step seven is for you to actually compare what you have to your goals to make sure you're not derailed.

[C]

One second over. But I'll give it to you. Okay, next question says money guy team. What do you mean by graduating from target retirement funds? What's next after that?

[B]

Well, I think there's. You get even more tax efficient with your investments because Roth, you love the tax free growth after tax. You love the liquidity and access to it. And then tax deferred, you know, it's the least tax efficient.

[A]

A target retirement fund is a generalized portfolio solution. Once you graduate past that, you move to a personalized specific portfolio allocation meant just for you based on your income, account structure, availability, goals, time horizon, risk tolerance, risk capacity. I was good.

[C]

Two seconds over. I guess I'll give that to you too. Next question says, should we calculate savings rate off of gross income minus daycare expenses? If the daycare expense is large and make saving 25% hard, no, you should

[A]

not subtract it off. But you should give yourself some grace. This is a period, this is a season. You may not be able to save 25% right now. And that's okay. Go to moneyguy.com resources. Check out our how much should you save Deliverable? Even if you're young, you're not saving 25%. There's a good chance at lower savings rates. You still get where you want to be later in life.

[B]

That's why we like the gross is because it does it. It doesn't let you do any of the what ifs that a lot of people do. People hate that we use gross, but it's specifically for these purposes.

[C]

Right on time. Even with the speedy talking man. If anybody's listening Micro Machines or two times speed listening back.

[B]

I mean, I felt like Bo just transformed himself into the micro machines.

[C]

We may revisit that in the ending scene.

[A]

It's only the last seven or eight seconds. I'm good for the first, like, you know, seven seconds.

[C]

All right, next question. Should I combine retirement accounts from old employers or leave them be and why?

[B]

Go to moneyguy.com resources. We have a great flowchart for you to answer a few yes no questions and you'll know the specific answer for your situation because it does have variability.

[A]

Four things you can do when you leave an employer. You can cash it out. Don't do that. You can leave it where it is. You can roll it to your new employer. You can roll it to an IRA rollover. The deliverable Brian just said, well, what? Walk you exactly through how to make that decision.

[C]

Well done, man. That resource really did the heavy lifting on that. But it is a great resource. Moneyguy.com resources go ask you.

[B]

Yes, no questions. That takes out the. It depends.

[C]

All right, last but not least, what do you guys like to do on your days off?

[B]

I mean, me and my daughter like to do errands. Whether it's washing cars, going and pick strawberries. Whatever you pick, fruit is available. That's what we like to do on the weekends.

[A]

Yeah. On days off for us, it's family time. We are still very much in the messy middle. So we're spending a lot of time in the pool right now. Hanging out, doing that, being outside, going for walks, trying to drink in these kids.

[B]

Youth.

[A]

My oldest is about to be 11 and I'm like, holy cow. She's. That's like seven more years, seven more summers, seven more Christmases.

[B]

Ah. I also. Because we're over. But it's the last question. I appreciate that. My wife does a usually a once a week date night plan. Like she, she just puts together something with a neighbor or friend. And that's. That's pretty cool too.

[C]

Very good. Well, that concludes our it does not depend rapid fire segment. Thank you for your submissions and questions. Let's now go into our maybe it does depend segment where we can talk about all the things you didn't get to say. I have a few marked.

[B]

Can I go back to 12, though? Because even my mom.

[C]

Yes.

[B]

Because I had a bunch of family in town for graduation and mom was like, so do you and Bo hang out on the weekend? My own mom says this.

[A]

We get that question all the time.

[B]

And I'm like, no, but not.

[A]

We don't personally know.

[B]

Oh, so y' all don't like each other. And I was like. I was like, mom, we hang out like every day for hours. As a matter of fact, my productivity gets killed because I'm in Beau's office talking all the time. I was like, but on the weekends, we typically are doing independent stuff. And it doesn't mean that we don't on purpose though.

[A]

We don't avoid.

[B]

Like, I would still like. But what's funny is Beau and I have vacation and you should know I didn't even told you this. So it'll be on air. We'll be the first. My wife was talking because we were on a trip, just me and her last week, and she's like, we ought to once a year do a trip with Bo. And I was about to say, you once did.

[A]

Oh, I did.

[B]

But he was like, just because that would be really Good to make sure that we. Because we do get busy doing so many things that sometimes I feel like we don't do enough stuff out of the office.

[A]

I'm for it then. You heard it right here. We're gonna do it.

[C]

They do indeed like each other. In case there was any question.

[A]

Those are some funny stories.

[B]

That's also when the funniest stories like your swimming ability and so forth came up from the last couple trip we made.

[A]

We would have never known had it not been tangents.

[C]

We could have. All right, well, we did ask a question about what's your money? Vice and I believe we ran out of time about so. Oh, and Brian couldn't think of anything.

[B]

You know what I should have said? Theme parks.

[A]

Theme parks.

[B]

Theme parks are a huge money. Vice.

[A]

You love cruises, too. Like cruising.

[C]

You can take your family to. That's a big fun generator.

[B]

Yeah.

[C]

You will go for that.

[B]

I think sometimes. My wife, God bless her, she's. Because those things, if you think about. I am definitely a stimulus seeker and so is our youngest daughter. So we love like high volume, high energy stuff all the time. And my wife is like, oh, my gosh. That's why I think she loved that we went to the beach last week.

[A]

Yeah.

[B]

Meanwhile, after day one, I got it. We got. We didn't get to fight. But she was definitely disappointed because, like, tomorrow we're going to find something else for me to do because I can only hang out on the beach one day. I start twitching.

[A]

You're not like a sit on the umbrella Reed kind of guy.

[B]

No, I just sat there and watched the. The water go in and out and out. And then it's like, all right, all right. It's pretty cool. What time is lunch? You know, it's just. I don't know, in and out.

[A]

Do you ever. Do you like, snorkel and stuff? Is that a thing you do or. No?

[B]

Well, yeah, I mean, I don't have a problem doing it. It's just that water was a little chilled.

[A]

Ah, got it.

[B]

I didn't. I didn't think it had enough sun on it yet in the season.

[A]

Because I'll tell you, down there at the equator a few weeks ago, it was perfect. So that's what we did. We were like, hang out and we go snorkel and go do that.

[B]

No, I do, like, because, you know, a few years ago we do it on a catamaran in the Grenadine Islands. And I love. Actually, it's one of the only vacations that I lost weight on now, there's other reasons, too, but it's. But it was. It was a lot of great snorkeling.

[C]

Well, we'll just leave that up to your imagination. All right. There was another question.

[B]

Yeah, don't do a catamaran trip. Like, I did it with a small, small, small, small catamaran.

[C]

Oh, my goodness.

[A]

Okay.

[C]

Moving back to personal finance, there was another question you guys kind of kept talking on, and I stopped you about, like, what age your clients are retiring. Did you have anything else you wanted to say on that one and what it looks like in real life?

[A]

Oh, what does fire look like in real life? Was that the one?

[B]

Yeah. You were saying? Because I said we don't have any clients really under 50 who are retiring. Like, I do.

[A]

Yeah. We actually had someone in the chat say, hey, I'm a client. I'm under 50. No, no, no, that's not what we mean.

[B]

Let the old guy say something.

[A]

People that are, like, truly pursuing fire, like, I want to work aggressively for 10 years, 15 years, and be out of the workforce forever. What we most often have, we have a lot of, like, very high earners, very esteemed folks who want to do sabbaticals. Hey, I want to take a year off. Take two years off. We have a number of clients that have done that a number of times now.

[B]

I got a client buying a sprinter van right now.

[A]

Yeah. And then we have some that are like, hey, I've reached financial independence, so now I get to choose what I do with my time based on what I want to do, not what I have to do. For some people, it's continued the same job because they love it. For others, it's shifting and volunteering or doing family stuff or whatever that thing may be. We do have a lot of folks that fall into that camp, but it's because they figured out saving early, and often it's given them flexibility and options later on in life.

[C]

So do you think, like, by definition, there are a lot of fire, like, people retiring before or going to the next endeavor before 65, but maybe they're not that traditional idea of, like, I'm fire and I'm saving 60% of my income and, like, that kind of thing?

[A]

Yeah. Like, I just looks different. I don't think I have any people, like, in my ecosystem that, like, have young children that are, like, fully checked out and done working.

[C]

Sure.

[A]

You know what I mean?

[C]

Yeah.

[A]

Like, maybe, like, older, high school, college age, but, like, I don't have any, like, fire people pushing a stroller and they're done, they're out.

[B]

I mean, look, I'll ruin it for everybody is because this is what you ought to understand you need. If the ideal is you get as much money as you can in an early enough age so you own your time that much sooner. And I think you'll find out that most people, when you get to the point that money is nothing but just a tool that you're using, it's not something that controls you having to wake up to go to work anymore. You're still going to want to wake up and know what you're doing is having an impact in the world. At least that's what I found is when I got to the top of the mountain and realized, oh, I have the level of money that I always thought I wanted is that it's not as cool as you think that you can just go buy anything you need to have purpose you need to have, why you need to have. There's more to it than that. And that's why I think a lot of people don't actually just completely tap out is because that seems not as cool as you think it is too. I think a lot of us have that daydream because you're stressed out. You don't control and own your time yet. So what do we do? It's the same thing. When I was growing up, my dad used to because he was in a high stress situation at work and we'd be on a, you know, riding down the street and he'd be like, you see that, that guy mowing grass on the interstate? I wish I had his job. You know, that's, you know, we all fantasize in some way to take the stress away. And that's why I try to give you the tools to go own your time that much sooner. Because when you truly do things because you want to, you have the power of you can say no to anything and everything, it just hits differently. And that's what I try to get to people. It's not really tapping out, it's just owning your time that much sooner.

[A]

That's right.

[C]

Yeah, that was good. I also had a note to come back to. Where is the best place to invest my money if I need to access it in five years. Did you have anything else to say?

[A]

I thought the thing about I keep all my liquid cash in a high yield money market and mutual fund right now is the best place and that's where I keep my like sub 5 year goals. But you said there was more you wanted to add to that.

[B]

Well, I was just saying sometimes when you have a sinking fund or something where it's like five years in the future, you probably could put 20% into 20% of that or 30% of that depending upon your risk, you know, variance or how hard it would hit you if all of a sudden that money was, you needed it and it was a downturn. You could try to juice things a little bit. Sure. I mean we are think about some of our debt. You and I have some debt goals that we're paying down some commercial real estate. We've put some of that money in the market for sure and even though we know it's coming up in the not too far future. So I mean, that's why I think there's nothing wrong with having a balanced approach to try to take advantage. Now with that said is if we get within three years of when we think we're paying off this debt and the market's at all time highs, we probably wind it down because we, you know, remember, pigs get fat, hogs get slaughtered.

[A]

That's right.

[B]

Oh, the only other thing I had on Harryby was, I think it was question number eight on the rapid fire was we were talking about should you do Roth ira?

[A]

Read that question again. Roth.

[C]

It was number eight.

[A]

It was, I was just gonna say

[B]

Roth is my favorite child. I know as a parent you're not supposed to name your favorite children, but if I'll count structures. I love Roth.

[A]

Again, it was the number second rapid fire question. But I think he wrote it as the, the eighth question overall.

[B]

Oh yeah, no, you're right.

[A]

So it's the second racket rapid fire question.

[B]

That was the eighth question.

[A]

Actually I think it was the third one. First one was fixed indexed annuity, second was something else.

[C]

Second or third question.

[A]

Hey, should I invest all of my money in a Roth 401k even if I have a pension?

[C]

Okay, yeah. Wow, we were speaking a different language there.

[A]

Should I only invest in Roth 401k? I'm going to have a pension later on. I said, hey, if you're a really high income individual, even if you are going to have a pension, I think there's merit to getting the current present year tax benefit. Doing that was sure, because you can

[B]

do Roth conversions down the road. But I just, I didn't want to poo poo on Roth dollars because they are my favorite children.

[A]

Well, we would never poo poo on it. But he, but the question was, I think the word all was in there, right? Like it's like this exclusivity if. If it makes sense to do all Roth for sure. But the time when it doesn't make sense do all Roth is if you're in a very high tax bracket, Roth can be costly. And so I would still think about maybe maxing out the pre tax and then doing some backdoor stuff and. And that sort of thing.

[C]

Well, that concludes our maybe it does not depend segment.

[B]

You want to do one more?

[A]

I'd say that was our best one, really.

[C]

You did pack a lot of meat into that rapid fire.

[A]

Really good.

[C]

Was good.

[A]

Not to toot our own horns, but yes.

[C]

Let's do one more question.

[B]

Let's do one more question before we close this thing out.

[C]

This one says Brian has mentioned. Oh, this is from Tim R. Tim says Brian has mentioned able accounts in the past, but only briefly. When are they appropriate and when are they inappropriate? We may be eligible to contribute, but if we become ineligible, it seems bad. Do you have anything to say to them or point them to before you answer that question?

[A]

Because I think it'd be helpful for you to explain what an able account is, how it operates. We've released. The thing that I'm thinking of is

[B]

people should go check it out. What bo's alluding to. We have a great resource, by the way, if you have anybody who has a special needs child or developmentally challenged child, we'd encourage you to go to moneyguy.com resources. We actually wrote an ebook and originally when we did it, we were like, we were gonna sell it. But then we're like, no, no, no, this is too valuable. So we're just giving it away. So if you just go out there and check it out now, look, it's not going to be the ultimate end all, but I think if you're just on this journey and you need something to kind of give you some overviews of some very key, important concepts, go out there, please. Because that's what the heart of this, when we designed it was. Because I'm on this journey myself and you've heard me talk about it in Millionaire. Mission I've talked about on the show is I don't have to save for one retirement. I have to save for essentially two retirements. Because after I leave, I know whatever I have saved up or built up is, it has to provide also for my youngest daughter. I like able accounts because the way these things were designed and this is what Beau was alluding to, you know, years ago they came up with 529s to help pay for college. Congress got together and said, hey, we need to incentivize families to be able to afford the rising cost of education. Let's come up with 529s. And the way that that structure was is that however you put money into these 529s, if you used it for qualified education expenses, it would be completely tax free. When you pulled the money out, well then somebody in Congress said, you know what? That 529 program worked out so well. Let's use the same code section, but let's make it for disabled, you know, people who have disabled children or family members. And they started off and it was a pretty, it was a pretty tight qualification, but they've actually unbundled that and made it even easier to qualify. I think originally it was like under 26. Now they've pushed that up into the 40s.

[A]

Oh, wow.

[B]

Or beyond. So. And then also earned income, if, you know, if you're, if your disabled child had earned income, that would limit you to some degree. They've lifted that out to a degree. But the way these things are going to work is that you can put money and now you don't get a contract, you don't get a deduction or anything, but you do get, they grow completely tax free, tax deferred. And if you use it for qualified expenses, which is pretty broad for disabled individuals, you can pull it out completely tax free. And they also up to the first hundred thousand dollars, it's not going to disqualify you from Social Security and other, you know, federal benefits you might be entitled to. Now there are limits. What I found is that when I started funding this, there was a state limit to how much these accounts could grow. But they've been indexing like how big they could be, but they keep indexing it for inflation. And I haven't run into an issue because I was at first loading this up. I have pulled back to a degree because now I'm doing more complicated estate planning and there are limits and that's why you'll need to work with your specific situation. But I think for most people it's, it's a pretty good while before you have to worry about that. And there is a, that website and I screw this up every time. I think it's nrcc.org is it.org yeah. Is it? No, that's not it. Type in able accounts, national resources. This is the problem with doing a live show.

[A]

That's okay, keep, keep talking and I'll able a b l e n r c.org a b l e n r

[B]

c dot org yeah, if you go check it, that great website lets you go state specific because there are different rules depending upon. Just like 529s are state specific. Able accounts are state specific as well. So you need. That's why I love a good aggregation website that kind of gives you an overview. And I'm very proud of State of Tennessee was one of the front running states. Very proactive on it and I've been very pleased with their plan. Great. Did that help?

[A]

Yeah, that was awesome.

[C]

It was great. Tim, thank you for the question. If you would like a money guy Tumblr as a thank you email winner moneyguy.com we'd love to send you one. And for anyone curious about able accounts and more of the things that Brian was talking about, remember we do have that deep dive ebook for [e-mail] resources

[B]

so by the way, somebody turn on the bat signal. I hear that Aaron talks. Money was in the room too.

[C]

She was.

[B]

So she heard we were talking about collaborators and she's like, ooh, let me get in there on that.

[C]

She must. I said, aaron, some folks were saying we should collab. What do you think? And she said, yes.

[A]

Oh man, that's a great idea.

[C]

Exclamation point.

[B]

We should do that. Y' all are so, so bad. Awesome.

[A]

You should do.

[C]

Great idea. Actually, I think we should talk about that.

[B]

So spontaneous.

[A]

And look, if we did, if we happen to collab with Aaron, the way that you're going to know about it is if you subscribe to the channel right now, if you have not subscribed, if you're just renting your seat, make sure you click that subscribe button. So when we have new content come

[B]

out, by the way, 48% last night,

[A]

the only thing that comes out on this channel is new and original content. So you will not get overrun, you will not get overloaded. Make sure you subscribe so that one, we know you're out there. And two, you can get updates when we have exciting new, fun, cool collabs coming out.

[B]

Last 28 days, I think 48% of our traffic was still unsubscribed.

[A]

That's only half of you. That's only 50% of you.

[B]

But that does mean glass half full is 51% are returning.

[A]

The majority of that's true.

[C]

The majority.

[B]

Guys, there is a better way to do money. And you know, we try to every day pour into you the better ways to even look at this tool because it only, it does have limits. To what it can and cannot do for you in your life and we just try to help you become the best version of yourself. Also own your time that much sooner because we really do want you to live your best life. I'm your host Brian, joined by Mr. Bob, joined by Rebe and the rest of the content team in the wings here.

[C]

Money Guy out the Money Guy show is hosted by Brian Preston and Bo Hansen. Brian and Bo are partners with Abound Wealth Management. Abound Wealth Management is a registered investment advisory firm regulated by the securities and Exchange Commission. In accordance and compliance with the securities laws and regulations, Abound Wealth Management does not render or offer to render personalized investment or tax advice through the Money Guy Show. The information provided is for informational purposes only, may not be suitable for all investors and does not constitute financial, tax, investment or legal advice. All investments involve a degree of risk, including the risk of loss.