Podcast Summary

Money Guy Show

Episode: How to Adapt When Your Income is Cut In Half | Making a Millionaire

Date: November 24, 2025
Hosts: Brian Preston and Bo Hanson
Guest: Rachel

Episode Overview

This episode of the Money Guy Show centers on Rachel, a public defender whose finances were turned upside down after a divorce that effectively cut her income in half. The discussion navigates how she has adapted, re-prioritized, and rebuilt her financial plan to pursue freedom, philanthropy, and security for her children. Brian and Bo walk Rachel through assessing her goals, optimizing her strategy, and making space for both giving and growing wealth—providing actionable insight for anyone dealing with a significant income reduction or financial setback.

Key Discussion Points

1. Rachel’s Background and the Financial Setback

• Rachel is a lifelong public defender, mother of two young children (ages 5 and 6.5), and recently divorced.
• Before her divorce, Rachel and her husband enjoyed financial stability:

  “We just didn’t really think about money. We just had it...a level of just doing what we wanted. We had everything we needed and everything we wanted.” (Rachel, 03:48)

• Divorce shifted her situation: half the income, but the same bills—inspired a complete financial rework.

2. Rebuilding After a Life Change

• Rachel went from advanced savings (step 8 or 9 in the Money Guy’s order of operations) to square one:

  “I kind of went back to one...He got all the cash and I had the house. So, yes, I was kind of starting from one. I needed to make sure I had enough for deductibles. I think I had, like $2,000 liquid cash. I mean, it was like bare minimum.” (Rachel, 08:36)

• Brian and Bo stress that perfection isn’t required to succeed:

  “Perfection doesn’t exist for anybody...you can have a lot of mistakes and there’s still tremendous margin for success to come out the other side.” (Brian, 10:11)

3. Redefining Financial Goals and Values

• Rachel doesn’t aspire to be a millionaire:

  “I don’t think I need a million dollars to be happy. Well, I know I don’t because I’m happy now. And I don’t have a million dollars.” (Rachel, 01:51)

• Her main financial goals:

  • Philanthropy: She values supporting her community, feels a loss here post-divorce, and wants to resume giving.
  • Financial independence and retirement, aiming to retire when her son goes to college (~age 60).
  • Supporting her children’s education.

• Bo’s advice:

  "Money is nothing more than a tool that allows us to achieve our goals...sometimes the pursuit of one goal will impact our ability to pursue another." (Bo, 06:49)

4. Current Financial Snapshot

• Net worth: ~$362,000 (10:59)
  • Cash: $22,000 (4 months’ expenses)
  • Investments: $232,000 (403B, 457, 401A)
  • Home: $349,000, Mortgage: $179,000 at 2.375% (11:44)
  • Debt: $60,000 owed to her sister from divorce settlement (13:34)
• Rachel continues overpaying both mortgage and sister’s loan (1,000/month), driven mainly by debt anxiety, even though optimal strategies may differ.

5. Evaluating Debt Repayment and Opportunity Cost

• Brian and Bo point out the low interest on the mortgage and the sister’s loan compared to possible investment returns:

  "You would agree that 3% is low interest...you would even concede that on your high yield savings, you're making 3.8. So there's an arbitrage there." (Bo, 15:46)

• Rachel acknowledges her approach is subconsciously driven by anxiety:

  “It was an anxiety ruled decision.” (Rachel, 16:34)

6. The Role and Risks of Public Pensions

• Rachel participates in Iowa's IPERS system—a defined benefit plan.

• Projected pension at 65: $10,254/month future dollars (~$5,700/month in today’s dollars) (18:33).

• No cost-of-living adjustment (COLA)—purchasing power falls over time; supplemental savings still needed.

  "We have to try to figure out what's the counterbalance because [the pension] is a blessing. But how do we add something so that we don't have to put all of our eggs in one basket?" (Brian, 21:04)

• Rachel also saves in 457 and 401A accounts, putting her on track for ~$884,000 in retirement assets at 65 (22:27).

7. Social Security and Long-Term Retirement Picture

• Estimated Social Security: $2,800/month at 65 (conservative figures).
• Combining pension, retirement accounts, and Social Security, Rachel could have ~$10,000/month at 65, enough to cover expected expenses and philanthropy (23:57).
• Issue: If she retires before 65, these figures drop and the margin tightens.

8. Optimizing for the Future vs. Debt-Free Now

• Brian and Bo advise Rachel to reconsider overpaying low-interest debts, showing how redirecting even $220/month (currently used to prepay the mortgage) into investments yields substantially better results—achieving debt freedom faster and providing greater future wealth:

  “You’re going to get there two years faster...just that little $220 a month extra that you’re paying in principal could turn into almost $160,000." (Bo, 35:54, 36:54)

• Suggestion: Redirect extra mortgage/sister-loan payments into investment accounts or philanthropic efforts, aligning spending with true priorities.

  "If my goal is X, am I deploying my dollars in such a way that it satisfies X? Or do I have the goal, but where my dollars are going is in conflict or in opposition to that?” (Bo, 39:22)

9. Practical Homework for Rachel

Bo’s assignments for Rachel:

1. Talk to her sister about the payback speed/arrangement.
2. Reconsider mortgage prepayments—consider investing instead.
3. Audit her budget and align spending with goals: List major goals and match recent spending patterns to them, correcting any misalignment (39:34).

“I sit down and I list out all my goals, and then I look at my budget...did the dollars that I spent over here align with the things that I have on this side? If there’s misalignment, I would consider how do I realign this?" (Bo, 39:34)

10. Empowerment and Moving Forward

• Rachel’s story is one of resilience and learning; she encourages others facing similar disruptions:

  "It is worth it if you think that's the best path for you; you can figure it out...I just didn't know, and now I feel like I know." (Rachel, 28:59, 28:54)

• Brian and Bo assure listeners: setbacks aren’t the end—small decisions and a realistic path forward still yield major gains.

Notable Quotes & Moments

• On happiness and wealth:

  "Maybe being a millionaire is a bad thing. I guess it depends on how you use your money." (Rachel, 01:44)

• On setbacks:

  "Perfection doesn’t exist for anybody...you can have a lot of mistakes and there’s still tremendous margin for success to come out the other side." (Brian, 10:11)

• On money as a tool:

  "Money is nothing more than a tool that allows us to achieve our goals...It's just a means to an end." (Bo, 03:07)

• On fear and motivation:

  "It was an anxiety ruled decision.” (Rachel, 16:34)

• On financial alignment:

  “If my goal is X, am I deploying my dollars in such a way that it satisfies X?...try to realign those.” (Bo, 39:22)

• On rebuilding confidence:

  "It is worth it...I just didn't know, and now I feel like I know." (Rachel, 28:59, 28:54)

Timestamps for Key Segments

| Segment | Timestamps | |---------------------------------------------- |--------------| | Opening, episode setup | 00:45–01:40 | | Rachel’s background and pre-divorce status | 01:15–03:48 | | Impact of divorce, rebuilding finances | 04:11–09:04 | | New financial goals and value of philanthropy | 04:47–06:15 | | Financial order of operations, setbacks | 08:24–10:44 | | Current asset/debt snapshot | 10:59–13:39 | | Sister’s loan and attitude toward debt | 13:34–16:34 | | Public pension details & risks | 17:04–21:04 | | Retirement assets, Social Security | 21:29–24:44 | | Prepayment of debts vs. investment strategy | 33:15–36:54 | | Homework for Rachel (reassignment suggestions)| 38:32–39:53 | | Empowering final words | 28:54, 39:55 |

Tone and Takeaways

The tone is compassionate, practical, and encouraging. Brian and Bo blend numbers and optimism, repeating their signature message: there’s no perfection—just good, better, and best steps forward. Rachel’s honesty about her struggles makes her an everywoman avatar for listeners.

Final thought:
Life may force you back to step one—but with a thoughtful plan and self-awareness, you can recover, align your dollars with your values, and continue building the life (and legacy) you desire.