The Truth About Starting Over in Your 40s | Making a Millionaire

Summary

Podcast Summary

Money Guy Show

Episode: The Truth About Starting Over in Your 40s | Making a Millionaire
Hosts: Brian Preston & Bo Hanson
Date: August 18, 2025
Guests: Shelby & Dustin

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Main Theme & Purpose

This episode explores the financial realities and opportunities of “starting over” in your 40s, using Shelby (33) and Dustin’s (43) recent marriage and combined financial journey as a case study. The hosts guide the couple through financial strategy discussions, including managing debt, investing, college savings, and planning for retirement given their age difference, varying backgrounds, and career trajectories.

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Key Discussion Points & Insights

1. Backgrounds & Family Dynamics

• Shelby and Dustin share their histories: Shelby’s disciplined financial upbringing and Dustin’s later start in wealth-building after careers in teaching and journalism.
• Both have lived in Nashville for over a decade; each moved from Texas.
• Dustin has a son, Mason (11-12), making planning for college and step-parenting relevant topics.

“We had both been married. He has Mason, his son, and we just knew what we were looking for. Once we found it, we said, all right, this is a good thing.”
— Shelby [03:19]

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2. Net Worth & Current Financial Snapshot

• Combined net worth: $400,000
• Combined household income: $180,000
• Assets include cash, home equity, and retirement accounts.
• The couple’s approach: Combine finances with a “fun money” allocation for each partner’s discretionary spending.

“Once I sold my house… we combined all of our finances. Currently, everything is combined. We have our own personal checking accounts that has, like, fun money. So $300 a month, like, just go spend it…”
— Shelby [10:06]

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3. Past Financial Lessons & Debt

• Both have histories with credit card debt and using the Dave Ramsey snowball method to eliminate it.
• Both are now debt-averse and cautious with credit.

“We were paying off credit cards with credit cards back in the day… My boy’s mom and I did the whole snowball thing back in the day… ever since then we’re able to stay out of that hole.”
— Dustin [17:12]

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4. Student Loan Debt: Challenge & Resolution

• Dustin has had student loan debt since his early 20s, a significant psychological and financial burden.
• The plan was to use a mix of savings (from a car fund and other earmarked goals) to pay off $57,000 when interest resumed at 7%.
• Hosts recommend prioritizing payoff as it now qualifies as high-interest debt.

Notable Quote:

“Getting rid of it now, I don’t even know what that’s going to feel like, honestly. It feels like an albatross… I got used to the weight.”
— Dustin [40:54]

• The couple decides to liquidate some planned savings/cash to pay the loan off immediately, accepting they’ll rebuild other funds afterward.

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5. Attitudes and Habits Toward Money

• Shelby manages the daily/weekly budget with extreme diligence; Dustin prefers a less hands-on approach but trusts Shelby’s stewardship.
• Systematic, “forced scarcity” savings: automate contributions to emergency, tax, SEP IRA funds, and other buckets.

Notable Quote:

“I’m in there every morning and every afternoon and every night, like, multiple times a day… I’m obsessive about it, really…
But he’s also not causing problems. So it’s like, you know, if that’s what keeps you relaxed, then all good.”
— Shelby [14:22]

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6. Large Cash Position & Allocation

• Cash on hand: $143,000, allocated into:

  • Emergency ($42,000)
  • Car replacement ($40,000, but this can be stretched/tweaked)
  • Mason’s college ($16,000)
  • Home maintenance ($8,500, potentially unnecessary with robust emergency fund)
  • Honeymoon fund ($3,800)
  • SEP IRA funding & self-employment taxes

• Shelby asks about proper time horizons for keeping cash vs. investing for goals (college, car, etc).

Guidance:

• For goals <18-36 months: Stay in cash.
• Goals at 5+ years: Can invest more aggressively.

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7. Retirement Planning Realities

• Target retirement number: $3 million, built using the “4% rule” ($120,000/year withdrawal).
• Current savings/investment rate: ~$60,000/year (Roth IRAs, 401k, SEP).
• Their projected savings trajectory exceeds $4 million by Dustin’s 65th birthday, generating about $97,000/year.

“We have 200,000 saved… if you continue to save just this $60,000… the number turns into $4.6 million.”
— Bo Hansen [51:42]

• With current living expenses (~$7,000/month, including mortgage), it appears $3 million may be an overestimate, especially once mortgage is paid and son is out of the house.

Key Reflection:

“Is 3 million really the number? … [If not,] does that open up opportunities for us earlier on than maybe we had even thought would be possible?”
— Bo Hansen [49:23]

• Hosts encourage the couple to consider “minimum bands” vs. “aspirational” funding levels and re-evaluate as income/assets change.

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8. Solo 401(k) vs. SEP IRA for Self-employed

• Both have SEP IRA (prompted by the show), but hosts recommend a Solo 401(k) for greater flexibility—especially catch-up contributions and salary deferral components.
• Dustin, as real estate agent, could benefit more by maximizing Solo 401(k) vs. just profit-sharing with SEP.

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9. College Funding for Mason

• Goal: $50,000 by college start (leverage Tennessee Promise, which covers first two years’ tuition at community college).
• Currently saving $6,000/year, well on track (109% of goal at target age).
• Shelby raised concerns about overfunding 529s (stemming from family experience), but hosts explain improved flexibility:
  • Unused funds can often be rolled into a Roth IRA (up to $35,000)
  • Only pay taxes/penalty on growth, not contributions
  • 529s can be used for trade school, graduate school, or transferred to other family members

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10. Planning for Age Difference in Retirement

• 10-year age gap means careful structuring of accounts is needed, especially for early access (bridge accounts) until Shelby reaches withdrawal eligibility.
• Taxable brokerage ("gap") account can provide flexibility and bridge income needs.

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Notable Quotes & Memorable Moments

• On Paying Off Debt:
  “I feel like an albatross has been around my neck… I just got used to the weight… I'm glad to get this out of my life because I got way better things I can do at $57,000.”
  — Dustin [40:54]

• On Budgeting Styles as a Couple:
  “He is not as engaged with it on a daily basis. Like, I’m in there every morning… multiple times a day… but he’s also not causing problems. So if that’s what keeps you relaxed, then all good.”
  — Shelby [14:22]

• On Retirement Numbers:
  “If 3 million were the magic number, which I'm not convinced that it is… is 3 million really the number?... does that open up opportunities for us earlier than maybe we had even thought?”
  — Bo Hansen [49:23]

• On College Savings & 529s:
  “If all you did is… $35,000... in the 529, you at least have an escape hatch that could be rolled into Roth IRA over the next number of years.”
  — Bo Hansen [68:07]

• On Financial Progress:
  “We think you ought to probably go and pay off the student loans… spend some real time figuring out what your number is. Realistically, what do we want to spend traveling? What are we going to do when we retire? How are we going to live life?”
  — Bo Hansen [69:17]

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Important Segment Timestamps

| Segment | Topic | |---------------------------|------------------------------------------------------------| | 03:33–04:12 | Net worth and income snapshot | | 04:12–06:37 | Dustin & Shelby’s financial backgrounds | | 09:00–12:40 | Combining finances, real estate windfall | | 12:40–14:22 | Financial pain points (student loans, college, retirement) | | 14:22–15:56 | Household budgeting dynamics | | 17:12–19:47 | Past debt experiences and credit management | | 21:12–27:33 | Household cash position and specific savings buckets | | 27:33–29:05 | Vacation/memory spending philosophy | | 29:06–31:45 | SEP IRA and Solo 401k differences for self-employed | | 33:54–41:12 | Student loan payoff logistics & emotions | | 44:17–46:29 | College funding strategy and progress | | 46:39–52:41 | Retirement number, savings trajectory | | 54:38–56:01 | Re-evaluating whether you're “behind” or on track | | 57:18–59:46 | Planning for age gap in retirement and taxable accounts | | 61:02–64:00 | Investment time horizons for goals | | 64:29–68:17 | 529 concerns & flexibility, family background | | 69:17–70:17 | Homework & next steps |

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Actionable Next Steps (from Hosts)

1. Pay off student loans immediately as deferment ends/interest resumes.
2. Clarify your retirement “number” realistically. Base it on actual desired lifestyle/spending.
3. Consider a Solo 401(k) for business income over SEP IRA for more contribution options.
4. Finalize your approach to college savings—mix of 529 and taxable brokerage based on comfort with restrictions.
5. Allocate future savings: Fund bridge account for early retirement access; automate contributions as you already do.
6. Periodically revisit all goals as circumstances and time horizons change.

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Overall Tone

• Practical, direct, and encouraging—hosts reassure the couple they are already making smart decisions and “not behind,” validating their caution and diligence.
• Conversation is light-hearted, supportive, and friendly, full of relatable anecdotes about personal finance struggles and victories.

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For listeners:
This episode is a candid, in-depth look at “catching up” financially in your 40s, showing that strong systems, open discussion as a couple, and a willingness to adapt can create confidence and tangible progress—no matter how late you feel you’ve started.

Transcript

[Shelby]

Mama.

[Bo Hansen]

Papa.

[Shelby]

Mi cuerpo Crece a un ridmo alarmante. Il arropa muy pronto. Amazon gasta menos son riemas.

[Bo Hansen]

You say you'll never join the Navy.

[Brian Preston]

That you never track storms brewing in the Atlantic.

[Bo Hansen]

And skydiving could never be part of your commute. You'd never climb Mount Fuji on a.

[Shelby]

Port visit or fly so fast you.

[Bo Hansen]

Break the sound barrier. Joining the Navy sounds crazy. Saying never actually is.

[Brian Preston]

Start your journey at navy.com, america's Navy, forged by the sea. I am curious, though. For you, Dusty, this thing's been part of the family.

[Bo Hansen]

I mean.

[Brian Preston]

Cause you've had student loans since you're in your 20s. 18 to 20s. So now extinguishing this at 43, how does that feel to know that this.

[Dustin]

Will be completely behind you again? Things that had been resigned to. It feels like an albatross and been around my neck, that I just got used to the weight, you know, or people have a disability. They just feel like, oh, my pain level is X. So that feels normal. And it's almost like I feel a sense of guilt about it. I brought this into our world, and it is what it is. And I can't undo choices that I made. I'm glad to get this out of my life because I got way better things I can do at $57,000.

[Shelby]

I am Shelby. I am 33. We were just talking earlier. So I've been in Nashville or in the Nashville area for 10 years. Next week will be 10 years.

[Bo Hansen]

That makes you a native around these parts, right?

[Shelby]

Yeah. Once you hit that 10 year mark. So I'm from Texas originally. Born and raised outside of Houston. And I moved here for work.

[Dustin]

I moved here with the boy in 2008 or to Nashville, actually moved down into Murfreesboro in 2013. So I've been here for quite a while too.

[Bo Hansen]

Also a native now.

[Dustin]

Yeah.

[Brian Preston]

You're very liberal with this native.

[Dustin]

Yeah. I also grew up in Texas, but I don't claim it as my home, so.

[Brian Preston]

Okay.

[Dustin]

Yeah.

[Shelby]

Oh. I still claim I'm a Texan that.

[Bo Hansen]

Unique amongst Texans because every Texan I've Even Texans that live away for like 50 years.

[Brian Preston]

Okay. I have to try one of my theories.

[Dustin]

Yeah. It's its own country.

[Brian Preston]

It's a very low count on when it hits. All right. But I always ask people from Texas, do you have a Texas tattoo?

[Shelby]

No.

[Bo Hansen]

Now she's got a lot of them.

[Shelby]

No. But you have to understand that Texas, like raises you to be very proud. You are Born and raised there. Like, whenever you're in elementary school, middle school, high school, like, you say the Pledge of Allegiance to the United States and then you say the pledge to Texas.

[Bo Hansen]

That's right. Of course.

[Shelby]

And, like, I think a lot of people don't even realize that, like, you're raised to be very proud to be from Texas.

[Bo Hansen]

All of our.

[Dustin]

All of our.

[Brian Preston]

Question's weird.

[Dustin]

I mean, my football coach was my history teacher, and we did Texas history.

[Bo Hansen]

That's it.

[Dustin]

I don't remember any.

[Shelby]

Apparently other states don't do, like.

[Brian Preston]

Yeah, it's not normal seventh grade. Georgia. It's seventh grade, by the way.

[Shelby]

There you go.

[Bo Hansen]

That's when we do Georgia history.

[Brian Preston]

Well, that's what I know. I could still tell you, like, all the counties in Georgia and stuff, but Tennessee, I'm a little clueless, little shaky.

[Dustin]

You know, Williamson, that's fine.

[Bo Hansen]

All right, awesome. So you guys moved here a number of years ago. How long have you guys. How long have you guys known each other? How long have y' all been married?

[Dustin]

Knowing each other? About a year and a half. We got married almost a year ago.

[Shelby]

We're coming up on our one year anniversary.

[Bo Hansen]

Happy anniversary.

[Shelby]

Thank you. Which was basically a year from our first date.

[Brian Preston]

Oh, wow.

[Shelby]

Yeah. I mean, we had. Both of us. I'm 33, he's 43. We had kind of lived our life. We had both been married. He has Mason, his son, and we just knew what we were looking for. And once we found it, we said, all right, this is a good thing.

[Dustin]

We know when we see a good.

[Bo Hansen]

Thing, and I love it. So one year anniversary, now we're talking about, okay, hey, what's the rest of our lives look like? How are we going to put this together? How are we going to think about doing this collectively as a team? That's awesome. And it's great you guys were kind enough to share with us a net worth statement. So I just want to give the audience sort of a run up, sort of where you guys are right now, because it's pretty awesome. As we sit here right now, you guys have a total net worth of $400,000, which is pretty wild. And then you have a great income collectively as a household, you make about $180,000. So you guys are in a great spot and doing great. Has it always been that way? Like, we're. Both of you, like, walk us. Give us the. So we know where you are today. Give us the backstory.

[Dustin]

Okay. The difference between her and I, she's always been a very Diligent, responsible human being. And I. And not so much with myself. I really didn't make making money a priority until I got into real estate. I started that about six years ago in 2019. Prior to that, I was a school teacher, I said, and make much money doing that. And prior to that, I was a journalist, so I made even less money. So, yeah. And so at this point in my life, like, I've been behind the eight ball as far as saving up for things and, you know, planning ahead, whereas she has a 401k that puts mine to shame, you know, or she has one. She has a 401k. I do not. Yeah. So, yeah, we come from different paths on that, and mine has just started a little bit later. Once my boy grew up, I was able to basically invest more in a career, you know, but let's pause for a second.

[Bo Hansen]

43 is not old. Like, 43.

[Brian Preston]

I'm older than I know some really guys.

[Bo Hansen]

Right? So 43, like, okay, yeah, maybe things didn't go exactly the way you would have written it, but here you are in a great spot with a lot of opportunity moving forward. Forward, Right.

[Dustin]

We're doing fine, then.

[Brian Preston]

Shelby and Mason probably make you even feel younger. Yeah.

[Dustin]

Yeah.

[Brian Preston]

Pulling you down on that side as well.

[Dustin]

I keep the beard up. It keeps me young, you know?

[Bo Hansen]

What about you? What was your background with Fine? Did you grow up knowing about money and thinking about money? How. How did that go?

[Shelby]

Okay, so my mom wants me to tell you all thank you. I turned her onto the show, and so she said, make sure to say thank you from me and my mom, which is hilarious for me to. To think that she wants me to thank you because I think of her as being extremely financially responsible and always have been. So my money knowledge comes from her. My parents were married up until I was about 15, and whenever I was younger, we had a piggy bank, and it had three different sections. So it had spend and give, savings and investment.

[Bo Hansen]

I love it. I love it.

[Shelby]

Every week, we would get whatever we were, whatever our age was. We get that in dollars, and we had to divide it into three. So even, you know, nine years old, you get nine doll. Really? You only get, like, $3, right? Because the rest of it has to go away. And that's as long as I remember. Probably until my parents got divorced, like, until I was 15 or 16, like, that was money. Right. And I remember one of the first. The first few things that I saved for, like, in first grade, I saved for this watch. I really wanted this Watch that was like a fortune teller watch. Like you had like a Magic 8 ball.

[Bo Hansen]

You ask a question, right?

[Shelby]

Exactly. But I had to save my money to get that watch. I had to save to get rollerblades and a boombox that had like a CD player and a tape player all in one. So that me growing up, like, that was my kind of upbringing with money. Both of my parents made way more money than I even realized. Like, I thought we were just like, middle class, whatever, but my parents both made a significant amount of money. We did not need for anything. We really didn't want for much either. But my mom was still trying to teach us, like, you don't just get whatever you want. Like, if we once we got allowance, if you wanted to go to a friend's birthday party, like, you had to take your allowance to buy that friend their birthday gift. Another one that I love is, I was 8th grade, we had a trip to Washington, D.C. and my parents said, if you want to go, you have to pay for it.

[Brian Preston]

Oh, wow.

[Shelby]

I don't know. Fifteen hundred dollars, twelve hundred, whatever it was. And I thought that I was paying for this out of my, like, investment money. And so I went on this trip thinking that I paid for it. And my mom loves to tell this story. I came home and I was like, mom, they were just. They. They just didn't care. They weren't really paying attention. They weren't listening when we were at the museums and everything else. Like, I paid for this trip.

[Brian Preston]

Yeah.

[Shelby]

Like, and then come to find out I didn't actually pay for it. My parents did. Like, they didn't take money out of my account for it, but I thought I paid for it. So I was like, no, I got skin in the game.

[Dustin]

Yeah.

[Shelby]

And so that, I think, is a little bit of a difference from how we, each of us were raised. And that's kind of some of what I want to pass on to Mason is I remember how important that was to me. Like, I had to pay for half of my first car. I had to pay for this trip to Washington, D.C. so I have always felt like this sense of, like, money matters and it's important and I need to use it wisely.

[Brian Preston]

Kudos to your parents for doing the stealth wealth thing where you never even knew how well they were doing, and they were kind of instilling things. It's interesting. We even have financial advisors on the team here who grew up listening to the show on road trips, like when they were in the seventh and eighth grade. So it does work. You Know, modeling good behavior in front of your kids is. It can be tremendous. Pay tremendous dividends down the road, too. And you're proof of that.

[Shelby]

Absolutely.

[Dustin]

Be cashing in on those dividends.

[Bo Hansen]

As you guys have. You said we each kind of lived our lives, and then now we've come together. How are you talking about money now as a couple? Like, how are you guys thinking about, like, money and finances? And how does that work in the household now, one year in?

[Dustin]

There's a lot to that answer. I think the big one is I helped her sell her house last year so that we could buy one together. So she was wise and bought before all the real estate inflation kicked in around 2019, 2020 here. So her real estate value doubled. And basically we were able to really get a strong cash injection right off the bat.

[Brian Preston]

Right.

[Dustin]

So that did us quite a lot of good starting off. And of course, you had everything you brought into it as well, but so I don't know, I kind of feel like I'm going.

[Brian Preston]

Any drama bringing everything together because, I mean, you have a son. And then also, did you consolidating finances, anything? That was because I know my marriage first year was kind of the most difficult because you're. It's a change in it.

[Shelby]

Yeah. So I, I. There hasn't been drama necessarily, but obviously you have some pain points. Right. So. And Dustin didn't come with nothing. Like, he had. He was planning on purchasing a house, so he had, you know, taking the steps.

[Brian Preston]

I understand it.

[Shelby]

So we did combine finances, basically, once I sold my house. Basically what you see in savings is that plus our 20 down on our house was what I made the sale of my house. So that's really what has set us up to that point, which I'm super grateful for. But we did combine finances pretty much shortly after I sold my house. Right. We closed on our new house a week or two before we got married. So pretty much at that point, we combine all of our finances. Currently, everything is combined. We have our own personal checking accounts that has, like, fun money. So 300amonth, like, just go spend it and you don't have to answer questions and whatever. You just spin it on whatever you want. But for the most part, everything's combined. Now, when we talk about pain points, doing that, number one part of what we're going to talk about is I want to be able to help Mason go to college. Like, I want to be able to help pay for that. I. My parents saved up money for my brother, sister and I to go to college. And I would like to be able to offer that to Mason where on the flip side, spoiler alert, student loans there, that's Dustin's, where he didn't have his parents save, you know, money for him to, to go to college. So he had to take out a series of student loans. So we can obviously see a big difference there. But I also am getting a 12 year. I'm on my back foot trying to save for Mason's college. Right. Because I'm coming in when he's 11 or 12 and he's going to be going to college a lot sooner than if I would have given birth to him and started this 12 years ago. And Dustin was doing the best as he could and he was doing great as a single dad, but didn't have a lot of extra income to be setting aside a bunch of money for retirement or college or anything like that. So I feel like we're starting a little bit behind there. So that is a little bit of a stress to me. And then the student loans, obviously there was conversation. I kind of was having thoughts of like, okay, do I just take some of this money when I sold the house and like, just pay the student loans off? I said, no, I'm not going to do that. Let's like, hold on to it. It was in deferment at the time and things changed.

[Dustin]

Yeah.

[Bo Hansen]

More to come on that we're very aware now.

[Shelby]

Yeah. So that's that. We'll talk about that in a moment. And then the only other thing was the retirement of like, okay, I want us to be retired. I want us to be able to retire together. Dustin's 10 years older than I am, obviously, seeing that he's at a different point in retirement and maybe where. I don't. I'm not sure that he's quite where he needs to be. I'm kind of scared, like, are you even going to be able to catch up? Like, are you going to be able to retire with me? Am I. I don't want to be retired and then have him still working.

[Bo Hansen]

Sure.

[Shelby]

But I also, in an ideal situation, I would retire a little bit early. He would maybe retire a little bit later than he normally would and we could retire within a couple years of each other and really enjoy that time together.

[Bo Hansen]

Yeah.

[Shelby]

So that's kind of my other concern of like, okay, what are we doing with the finance or the, the retirement, all of that? Like, are we where we need to be? Those were the pain points, if you will, as we were combining finances of just figuring out, okay, what Are we doing from here moving forward?

[Dustin]

Love it. And prior to meeting her where. I mean, I was just gonna get a town home with my boy and raise him and then do whatever I wanted afterwards. Wasn't really planning on getting married, but now that things have drastically changed, I had basically resigned that I probably wasn't really gonna have a retirement until I was able to snowball enough to be able to get there.

[Shelby]

And.

[Dustin]

And I was again behind the eight ball. So I came into that relationship with that mindset, really. And now I'm having to get used to very different world in which I can, you know, have some wealth and get ahead a little bit. And we. We're at a very good starting position for that.

[Brian Preston]

You're not alone in that mindset. I think that's the. When we do shows on net worth by age and so forth, the majority of Americans kind of one day they wake up and go, I guess I need to be thinking about retirement. Usually it's like 15 years from retirement, and you're like, you know, this is much easier. You choose your hard. It's easier. You start and. And you still have. I guess we've already shared with you 43. It ain't our eyes. You still got a lot of compound and army of dollar bills. And the wealth multiplier can do a lot of good for you. Two things I've kind of noticed. I always love dynamics with couples, so you strike me as that you're driving this. This train in a lot of ways. Is that a fair statement?

[Shelby]

Yes.

[Brian Preston]

Tell me how that dynamic works, and do you feel like you're carrying a lot of weight, or is it. Is it because you were saying you're worried he's not gonna be able to catch up? So give us some. Some insight into how you're feeling about all that.

[Shelby]

A couple of things. So when in our finances together, I'm the one that manages the budget, and we use rocket money. So, like, I'm the one that goes in and organizes everything. I ask him, you know, hey, I would like for you to kind of know what's happening with the budget. But he is not as engaged with it on a daily basis. Like, I'm in there every morning and every afternoon and every night, like, multiple times a day. Like, oh, I know this charge came through. Did it show up in rocket money yet? Refresh, Refresh. Like, I want to make sure that everything's there. I'm obsessive about it, really, which doesn't stress me out or anything. That's just. I like Just the way you are.

[Brian Preston]

Good.

[Shelby]

Where everything is where. If Dustin were to even look at it I would think on a daily basis it would be too. It would be overwhelming.

[Dustin]

Especially first thing in the morning. That'd be a fast tracking depression right there.

[Shelby]

But yeah, but he does look at it like at least monthly to make sure. Okay, like these are the things that are, you know, tax exempt or for work or whatever. He'll. He'll kind of track everything that way. So I definitely am managing the day to day budget. But it's pretty easy because Dustin doesn't really fight me on it. He's. I'm more of a spender than he is and I'm still not a super extravagant spender. So it's not like he's swiping card swiping card swiping. Carmel like please stop, stop, stop. We don't have the money for that. He's not really super engaged in the day to day but he's also not causing problems. So it's like, you know, what if that, what's. If that's what, what keeps you relaxed then all good. You know, it's just like you have.

[Bo Hansen]

A good balance there. You kind of know what you like.

[Dustin]

And keeps making good calls too.

[Brian Preston]

Well, I think as a husband, as long as she's happy, you're happy. I mean in a lot of ways, I mean that's, that's a dynamic in relationships.

[Dustin]

I mean she's driving the train and she's not, she's not killing us by a long shot.

[Shelby]

Yeah.

[Dustin]

So we're doing fine.

[Brian Preston]

The second part was I'm looking at Yalls debt and I was, I mean we'll talk about the mortgage. Looks reasonable. Student loans. We'll talk about that in a second. I didn't recognize what for TiVo was.

[Shelby]

Yeah. So when we bought the house we got a security system installed. As a woman that lived alone for 10 plus years, like your house has to have a security system. So we got that installed and with the cameras and the door locks and the sensors, all of that, they're like hey, you can do the zero interest like $4,000 for all the equipment so you don't have to pay the equipment up front.

[Brian Preston]

Okay.

[Shelby]

I actually forgot that we even had that because it's zero interest. It's one of Those things like 70 bucks a month whatever we pay. If we wanted to pay that off tomorrow we could. Not a problem. But it's zero percent interest. So I've gone back and forth like eh, I can have that money Working. It's on automatic payment. So I'm not worried that I'm going to, like, miss a payment and, you know, wreck my credit, anything like that. That's what that is.

[Bo Hansen]

0% until it's paid off. Like, that's not a cost. Wonderful.

[Shelby]

And I think they show it as, like. They're like, oh, well, if you want a credit card on this line of credit, we can give it to you. It's literally just there for the equipment.

[Brian Preston]

So debt currently doesn't look to be that much of an issue outside of the student loans, and that's even been under deferment. So we'll. We'll cover that in greater detail. But have you ever had any troubles with debt? Because that's something. Another struggle that a lot of Americans have is just consumer debt.

[Dustin]

She. She learned her lessons. I learned mine back in the day, too. My brother used to work for Dave Ramsey.

[Brian Preston]

Okay.

[Dustin]

So we had the whole. We were paying off credit cards with credit cards back in the day. Trying to.

[Shelby]

Anyway.

[Brian Preston]

Okay.

[Dustin]

And so we did the whole. My boy's mom and I did the whole snowball thing back in the day when we first moved here. And ever since then, we're able to stay out of that hole.

[Bo Hansen]

And because I have a lesson to learn early on.

[Shelby]

Right.

[Bo Hansen]

You learn that early on. You stay away from it.

[Dustin]

Yeah. And so I came into that with at least not a negative, you know, or at least not that negative.

[Brian Preston]

Yeah, that's a big benefit.

[Shelby]

And I'm kind of in the same boat. My first husband and I got married really young. We had a car loan and we had some credit card debt, and we basically did the Dave Ramsey, like, snowball and everything, too. We actually ended up paying off all of our debt with the exception of our mortgage at the time, like, right before we got divorced. So when we separated and got divorced, we didn't have anything that we had to split. He let me keep the house. I gave him what we had in savings, and it was kind of like, that's it. We didn't have kids or anything. And so I moved to Nashville and selling that, the money that I made off that house basically funded my move to Nashville. Got my down payment on my house here, and then I was pretty good. Had a. Not a good year in 2016. Basically 2017. I was like the year of Shelby. I just do whatever I want because I was healing myself after a bad relationship. And I racked up some credit card debt, paid that off by the end of 2018.

[Brian Preston]

And I got depression, doom, spending or was it rewarding yourself for because you're now free? What do you attribute that to?

[Shelby]

It was a little bit of everything. So I was definitely. I mean, I had a hard depression whenever I moved to Nashville, like, moved away from my family. I literally just gone through a divorce and didn't really give myself time to kind of heal from that. And then I. I was in an abusive relationship, unfortunately. And so it was a lot of different things of, like, I'm gonna take care of myself and I'm gonna just do whatever I want to do. Also as a side note in that I had co signed on a car that I ended up literally having to pay for completely because the other person I co signed for never made a single payment. So I had just finished paying that off. So it's like, you know what?

[Bo Hansen]

I'm gonna worry about me.

[Shelby]

I'm just gonna do what I want to do. I got vanilla ears, a beautiful smile. Like, what do I want to do? What's it? You know what I mean? Like, it was just. And I was 24. Like, I was young, and so that was my year. And it's. We're not talking like 50, 60, 70,000.

[Brian Preston]

That's what I was going. How far did it go? How much debt did you get?

[Shelby]

Maybe 15 to 18,000.

[Bo Hansen]

And you paid it all off in the next year.

[Brian Preston]

And was it just a wake up one day, like, oh, my gosh, what have I done? The year of Shelby has to come to a close or what?

[Shelby]

All right, this is enough. Like, relax. You need to calm down. Like, let's. Let's get back in order. And I mean, that whole time, I'd still been like, once I started my corporate job, I had still been, you know, putting money aside in retirement, all of that. I had been doing that, but I had a decent income for a single woman in Nashville. And so I was like, I can splurge on a few things. And yeah, then I buckled down and saying, all right, gotta be responsible. And I've continued to use credit cards ever since then, but I've just never had a balance I pay off. So I've never. Zero interest, never paid interest on a credit card since that time. But I continue. We use credit cards and get the points and benefits without having to pay interest.

[Brian Preston]

It's kind of like we say, credit card use is a. Okay, yeah. But credit card debt, no way.

[Shelby]

No.

[Bo Hansen]

I love that you've, like, okay, we had this misstep, this thing happen. We learned from it, didn't change, and we had this misstep and this thing happened, we learned from it didn't change. I just love that you're able to, like, adjust behavior. What that tells me is that, okay, even if you do feel okay, maybe we're behind on some of these goals. Because the only tension I heard is like, okay, we want to pay off student loans, but also want to save for college, but also want to have retirement, have these competing priorities. But you guys have already shown, like, you can do some pretty hard stuff. And you can, if you get your mind motivated, you get to move in an awesome direction. So I think this is gonna be a lot of fun. Right. So as we sit right here, net worth of 400,000. Let's kind of go through it real quick, because one of the things we noticed, we went through this is you guys have a lot of cash. Like, $143,000 of your $400,000 net worth is cash on hand. Walk us through why that's such a healthy cash position.

[Brian Preston]

Are y' all big cash people, or is there goals for each one of those things?

[Dustin]

Well, we're trying to fig what is best to do with that, and we're probably going to alter it based off this conversation. It's really how that goes.

[Shelby]

Yeah. So we've been holding on to it. It's like, I'm not going to make any moves until I talk to Bo and Brian and I can figure out what it is exactly that would be most beneficial to do with this cash. Because I. I like the idea of. I mean, I opened a brokerage account, so that Fidelity is a brokerage account, and I had it in another brokerage account for a period of time and, like, did some little dabbles with some investments and stuff like that. But part of my question, part of where I just don't know, my ignorance with it, is how much cash do you actually recommend having on hand versus how much should we invest? Like, if I know that we need to purchase a car and I'd like to pay cash in 18 months. Is 18 months the window that you keep it in cash, or do you invest it?

[Brian Preston]

Right.

[Shelby]

If I know that I want to pay for Mason's college in seven years, is that the amount of time that you keep it in cash, or do you invest it? Right. If we thought we had 18 months for student loans and kind of find out we have two weeks, I'm kind of glad that's not investment. Right, Right. So I'm trying. I don't know exactly where that window or what you recommend. That window being we have such a.

[Dustin]

Both of us, a strong aversion to debt.

[Brian Preston]

Yeah.

[Dustin]

Despite student loans. That neither of us want to ever be in that position again. So we just have this, you know, cash. Yeah, we have it on there in case, you know, both of our cars crap out tomorrow.

[Bo Hansen]

We can buy new ones as part of this cash. Is like a car fund sitting there, Is that what you're saying? Like for 18 months in the future?

[Shelby]

Yeah.

[Bo Hansen]

Is that right?

[Shelby]

Yeah. So I have it written down here kind of how that money is allocated out. So the 142,000 total. 42,000 of it is emergency fund.

[Brian Preston]

Okay.

[Shelby]

So that's our 7,000 burn rate for six months. 42,000.

[Bo Hansen]

That's perfect.

[Shelby]

40,000 of it was earmarked for a new car.

[Brian Preston]

Okay.

[Shelby]

I am in a position where I, for my company, I have to have a new. This sounds ridiculous, but in order to get basically the. The car allowance that I get, my car can't be any more than four years old. It can't have more than 60,000 miles on it, or otherwise it's taxed. So in 18 months, I'll hit that mark. So I will need to get a new car. My car is a 20, 23. Like, it's not old. It'll go to him, and then his car will go to Mason. And that's kind of what we're planning, but that's why we have kind of a hard timeline of. I know in 18 months we will have to purchase a new car.

[Brian Preston]

I do want to clarify. You said it will be taxed unless it meets these things. You still get it even if it exceeds the age. Okay.

[Shelby]

Currently it's tax free.

[Brian Preston]

Okay.

[Shelby]

And that is about $9,000 a year that I get tax free right now.

[Brian Preston]

Okay.

[Shelby]

I don't know if the tax would be. If it would be taxes. Income. I'm not sure about that.

[Bo Hansen]

It'd probably be ordinary income. Would it be taxed at. So be taxed at your marginal tax rate. Whatever the marginal tax rate you guys fall into.

[Shelby]

Okay. So 22%.

[Brian Preston]

I was going to say 22%.

[Shelby]

So I don't want to pay that tax.

[Bo Hansen]

Well, but. But I want you to think through. I want you to think through this. Right.

[Shelby]

And that's why we're here.

[Bo Hansen]

$9,000 times a 22% tax rate. You guys live in Tennessee, so there's no state income tax. It's $1,980 taxes. So I want to make sure I'm hearing you correctly. In order to save $1,980 of taxes this year, I'm going to go spend $40,000 on a new car.

[Shelby]

Okay, but when you make sure that.

[Bo Hansen]

I understand the math here, it sounds a little silly.

[Shelby]

Yes. When you put it that way. My other, the only other thing that I will mention, his car is 11 or 12 years old.

[Dustin]

Yeah.

[Shelby]

One of us will need to get a new car in the next year. You know what I mean? It makes sense to just have mine that's paid off go to him, his car, go to Mason, me get a new car. So then it, you know, it's another four years. Now if we both had relatively new cars and it was like, you know, there's no way that either of us would be getting a new car for another five plus years anyway, then maybe I could understand, like let's, let's pay the tax or whatever on that. I still think. And I could just be, I just want a new car. You know, I could, my, my judgment could be clouded, but I think knowing that we're going to have to get another car anyway, I think that it would still make sense to go ahead and spend the money on.

[Bo Hansen]

But maybe not at the 18 month mark. The 18 month mark is somewhat. Is. I don't say arbitrary because there's a thing that happens.

[Shelby]

Right.

[Bo Hansen]

But that thing may not be quite as cataclysmic as you think it is.

[Shelby]

Correct.

[Bo Hansen]

Right. They might be able to stretch it out because how old is your car again?

[Dustin]

2014.

[Bo Hansen]

2014. And when will Mason start driving?

[Dustin]

He's got about two and a half years.

[Bo Hansen]

So really, if so we got some. May even have a two to three year window potentially and still be able to do that car shuffle and it all line up. Is that an accurate assessment?

[Brian Preston]

Keep going. Also on your list though, you had 40. But answer Bo's question and then keep us going on the.

[Shelby]

Yeah, so yes. Sorry. If I remember the question, could we. Could that instead of 18 months be two to three years? Yes, potentially it could be two to three years. And in 18 months I might have a different job. I hope not. I love the company that I work for, but I don't know. All of that could change too. So I know that that is the case. I just want to be prepared in case that is the case. Then we have about $16,000. $16,000 earmarked for Mason's college. My goal or my thinking on that? Tennessee. Tennessee promise. Amazing wish Texas had that. My thinking is that we have $50,000 saved for him. He has to take advantage of the Tennessee Promise, do community college, do community service, all of that. And then we would have 50,000, $50,000 for his junior and senior year at a local in state, non private university. We're not going crazy here. I think that that should be plenty. I mean for less than that. But that's, that's where I'm coming up with that number 50.

[Bo Hansen]

So $50,000 college goal.

[Shelby]

Right. But I have 16. We have 16,000 already built towards that. Right, Great.

[Brian Preston]

Just for the audience. Because they might need the context. If you live in Tennessee and I have a daughter who's now a senior in college, your first two years of community college are completely free in the state of Tennessee. That's the promise and it's legit. She has a lot of friends that have taken advantage of. We have employees that have children taking advantage of it. So that's a brilliant education hack. If you live in the state of Tennessee. We're from the state of Georgia, which we had the, the Hoop scholarship, which helped both of us make it through. So I love it when these, these, these states get very creative to, to pay it forward for the next generation.

[Shelby]

Absolutely.

[Dustin]

And we have Motla just down the road. So we're gonna be good.

[Brian Preston]

Yeah.

[Bo Hansen]

That's awesome.

[Dustin]

Yeah.

[Bo Hansen]

All right, so 42 emergency fund, 40,000 new car, 16,000 college, what else you got?

[Shelby]

And then we have 8, $500 in a home maintenance fund. And I'm kind of on the fence about this. My aunt is a financial planner and advisor, so I actually talked before I'd heard back from you guys. I talked to her a little bit for two hours and she was kind of saying like you have 42,000 in emergency fund, you don't really need to have 8, 500 also earmarked for.

[Dustin]

And our home is only a year.

[Shelby]

Old and it's also a brand new house. It was a new construction.

[Bo Hansen]

I like it.

[Shelby]

I have also been in a position where I had to replace an AC unit in a house. I had to do a bunch of crawl space work and stuff. Like I've been there, but I kind of am under the thought now.

[Brian Preston]

I bet your insurance, I mean, I bet your AC is covered for the first five years for sure. And if your builder put a nice enough paid, the 500 extras might have a 10 year warranty on it. Found that out the hard way that my, my builder unfortunately could be five year unit in there, not the ten year unit.

[Shelby]

So that while when we submitted all of this to you, that was 8, $500 flagged for that however, I'm more inclined to say we don't need to have that. Perfect. Great. I love it. We have a honey, what's remaining of a honeymoon fund which is.

[Dustin]

That's definitely going.

[Shelby]

Yeah, it's $3,773 to be specific. Basically it's down to 2,000. We booked our last few like excursions and stuff for our honeymoon. We're going on a one year anniversary. So there's $2,000 that's actually now like available for something.

[Bo Hansen]

That's great.

[Shelby]

Exactly.

[Brian Preston]

Thoughts on that too?

[Shelby]

Perfect. Well, that was one of the things. Like I made $217,000 off my house and so it's like we can have a honeymoon.

[Bo Hansen]

Absolutely.

[Shelby]

We're going to put a lot of money towards a lot of really important responsible things. And we can take like.

[Bo Hansen]

But making memories is a really important, responsible thing to put money towards. And we're never going to fight folks on that.

[Shelby]

And then SEP Ira we have. Okay, so he has a SEP there that was just open this year thanks to you two. Because I heard you mention it. I was like, I came home, Dustin, you need a SEP Ira. Why don't you have this?

[Dustin]

Oh, my mom, my mother's a cpa. She had brought the up years ago and I spoke, I was with an Edward Jones guy and he's like, you don't make enough money to do that right now. Because I was at the time it was just me on my own. And so I just kind of put that on the back burner. And now that we're in this position where we have a dual income and you know, if you do real estate.

[Brian Preston]

Right.

[Dustin]

It just keeps on escalating. So that's where I'm at now. So we are earmarking how 20 what? Percent 25.

[Shelby]

So right now there's 16. This, he just had a deal this week. So this number's changed slightly. But according to these numbers, $16,631 is set aside in that SEP. So basically 25% of every check that he gets, every commission check we put into a vault in our SoFi.

[Dustin]

So we don't overpay but we're keeping it back.

[Shelby]

Right. Because my understanding with the SEP is that you have to be very specific about what you like. You can only put up to 25% of your net.

[Bo Hansen]

That's right.

[Shelby]

Gross.

[Brian Preston]

Well, there's an additional complication since he's a sole proprietor that there'll be a self employment offset. So it might, it might be only you get to do 20 somewhere between 18 to 20%. But. But wait, there's more. Is that one of the things we've been sharing because we've been doing content since 2006. So yes, we love the separate. Because that was in the past. The only way you could go back in time to take a deduction for prior tax year. But the government has actually changed the rules here in the last two years to now where solo 401ks can actually go back in time as well. That's a new provision within the last few years. We're probably going to talk about why you might want to consider taking the SEP into a Solo 401. Because then you get to do all the benefits of the SEP with the profit sharing from the company, that 18 to 20%. But then you also get to do the salary deferral just like you do as a traditional employee. So you could save more with the same amount of income, which is exactly what for Dustin specifically, If you're allocating 25%, we could do the 18 to 20%. That's the profit sharing and then backfill through salary deferrals. The other side of it. So lots of opportunity.

[Bo Hansen]

And how neat. Like right now you're putting this in your vault and in order to be able to do this next year.

[Shelby]

Yeah.

[Bo Hansen]

When you do the salary deferral through a solo 401k, what if you could have that money working for you every single month? Like we're just going to take 23, five, divide it by 12 and every month just put that in, get those money that those dollars work and it'll be, you'll have your 401k. Now you have your own.

[Dustin]

I finally grown up 44.

[Shelby]

So that's what we're doing right now with the set. But this sounds like really exciting news. So we might be changing that. But just knowing that we don't want to put too much in and then pull it out. We basically talked to his mom who does our taxes and said, hey, you know, if we could basically before we officially file, tell us exactly what that number is so we can put in exactly that dollar amount.

[Bo Hansen]

That's great.

[Shelby]

And then we won't overpay. And so then if there's any, you know, if it is in fact only 20%, we've been setting aside 25, then that extra money is reallocated to something else. And then I don't know all the numbers. I mean, you're. Those are the main ones. We also have an account that has anywhere from 2 to $15,000 in his tax account because again, self employed. So 25 goes into that SEP every paycheck, and 30 goes into a tax vault, every paycheck.

[Bo Hansen]

So I love this. You got the way that you do your household account.

[Brian Preston]

Pay yourself first. So good. It's a forced scarcity plan. That's what it is.

[Bo Hansen]

Oh, I love that.

[Brian Preston]

I like it.

[Shelby]

Yep, quarterly. He just paid his tax for last quarter, so now that accounts down to like $2,000. But he. We have that money, so we're not.

[Dustin]

Having to worry about each quarter there.

[Shelby]

Yeah, we always do have a little bit of an. Not a ton, but a little bit. Little cushion. Then anything above and beyond that, up until a week ago, was kind of. Okay, that's what we're saving for, the student loan payoff, because it's. It was interest free. Our understanding was it was going to be interest free until basically January 2027. So we had 18 months on that. So it's like, all right, any extra that we're saving and then we're setting aside, we're just bulking up that account for student loan payoff to pay the 57,000.

[Bo Hansen]

Love that. Well, you guys were great in terms of, like, laying out your goals for us. She said, hey, we really want to knock out student loans. Right. We had, at the time, we thought we had a window in which we could do that. Hey, we really want to save for college for Mason. And, oh, by the way, we want to be able to retire one day.

[Shelby]

Yes.

[Bo Hansen]

And so we thought one of the things that might be kind of helpful is if we took each one of these three goals and talk about, okay, where are you guys at currently in terms of progressing towards that goal? What is your current plan that you've laid out for us in terms of how you want to attack that goal? And if you do it that way, where does that put you? And then what we said is, hey, I wonder, might there be some ways we could optimize. Might there be some ways that we could allow your money to just work a little bit harder for you maybe, than it is presently? And so that's what we want to kind of lay out for you. How does that. Does that sound reasonable?

[Shelby]

Wonderful.

[Bo Hansen]

Awesome. All right, so let's look at the student loans first, because this is one that's kind of like top of mind, high priority. Right. So we think about where your student loans are currently. Here are the facts. We know that right now you have about $57,000 in student loans, both federal loans. They both were in deferment and we thought that we were going to have until January of 2027 to be able to build up cash to pay those off. So we got to get to 57,000. And right now, as of when you said the numbers, you guys are right at about 12,000. So when we think about the progress that we're making towards that goal, we're about 22% of the way there already. Right. And you said, okay, we want to take any excess capital that we have coming. And you said it was about fifteen hundred dollars a month that was left over. Right. We had about $15 a month of free cash flow on average. We kind of pulled this out of your budget, on average that we could deploy towards this goal. So if we just start right now at the 12,000 and we save $1500 a month every single month from now Until December of 2026, we'd get to about $39,000. So we'd have 39,000 of the 57. So we'd be like 68% of our way to our goal. But things changed. We thought that that was going to be a viable strategy. Right.

[Brian Preston]

Share with the audience what the big update was. Well, since you've already alluded to it.

[Dustin]

A little bit, yeah, this is. Okay. Problems that hang around your neck from when you were too young to know any better is really what this is. And a whole generation, I could get all in this that people who are enslaved financially and you're not alone in this.

[Bo Hansen]

This is a big issue for a lot of Americans right now.

[Dustin]

And it was a time in the late 90s when, like, you get a degree, it doesn't matter how you get it, you just get it. So with that told, I got $57,000 left on my student loans, that due to changes I was in the save program, and due to changes in that very recently, we are now supposed to begin payments on those as of August 1st, two weeks from now.

[Shelby]

Hang on.

[Dustin]

No.

[Shelby]

The government was really kind and said, you don't actually have to start making payments again. We're just going to start charging you interest again.

[Brian Preston]

So you still have the deferment. It just means.

[Shelby]

Thank you so much.

[Bo Hansen]

So kind of you.

[Dustin]

Yeah, they had their little thing they were reading off of for sure, but it's a 7% flat and we have what it takes to get rid of it. We just want to know exactly what the. And because of our aversion to debt, we're just like, well, let's get this out of our lives finally.

[Bo Hansen]

Well, and you know, we think you say you'll never join the Navy, never climb Mount Fuji on a port visit, or break the sound barrier. Joining the Navy sounds crazy. Saying never actually is.

[Brian Preston]

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[Bo Hansen]

Yeah, that's because it should be, Brian. We're financial planners. Protecting client data is a non negotiable.

[Brian Preston]

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[Bo Hansen]

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[Brian Preston]

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[Bo Hansen]

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[Bo Hansen]

There's no risk with Nord's 30 day money back guarantee. The link is in the podcast episode description box. When it comes to making financial decisions, there's a process through which you can work to figure out what's the best way for me to utilize my next dollar. Call it the financial order of operations. Zero percent student loans, in our mind, would fall into the low interest camp. But now for a 43 year old, if you have 7% student loans, all of a sudden that gets kind of fast tracked in our mind. That goes all the way to step three. That now becomes high interest debt. So in our opinion, it should be a high priority to get that thing knocked out pretty quickly. So this is what we said. If we want to think about how to extinguish that student loan debt, we know that right now we have the $12,000 currently saved up. We know that we have this home maintenance fund that's kind of like doubling up. We did not know how comfortable you were going to be playing with it. So we said, what if.

[Brian Preston]

We just.

[Bo Hansen]

Said, what if we take $2,500 from that home maintenance fund. We took 40,000 from the car fund because at the time we thought we had, you know, maybe 18. And we were hoping more. We actually have some time on that. And then if we could find another 2,350 either from possibly college savings, it sounds more like maybe the home maintenance fund. If we were to combine those together today, you'd be able to write a check and pay off the student loans.

[Dustin]

Yeah.

[Shelby]

And that's kind of what my plan. Once I heard that, I was like, all right, well, we're just paying it off and basically everything that's in the Fidelity account with a little extra on top is just going to that. And now our car fund is depleted and we, you know, have a little bit. So this is pretty much on track with what I had already talked about. Like, I'm not going to make any moves until we actually talk.

[Dustin]

Yeah, I wanted to hear somebody who doesn't have the emotional connection to this.

[Shelby]

A better idea.

[Brian Preston]

Well, you've heard us talk about on the show that the financial order of operations, everybody think it's just essentially walking up steps as you go. No, there's life changes happen where you all of a sudden find out that, no, this thing is due in two weeks or we're going to pay 7%. Where you guys are very fortunate, kudos to you is you have this pot of money that you had earmarked. Yes, it turns over the apple cart on the priority of where you're sitting at, but you're going to be able to extinguish this and still be able to hit the ground running and accomplish a lot of goals.

[Shelby]

I'm extremely grateful. Like, this is upsetting to hear this, but they. We could be in a much more difficult position. So I am, don't get me wrong, I am extreme. Like, okay, we'll rebuild up a car fund and if we need to get a car loan at a low interest rate, like it is what it is in 18 months, two, three years, maybe 36 months. Right.

[Bo Hansen]

We got time.

[Brian Preston]

And because you have 1500 dollars a month that you are putting on the student loan that is now free and clear to be used however you see fit. I am curious, though, for you, Dustin, you've had this. I mean, this thing's been part of the family essentially. I mean, because you've had student loans since you were in your 20s, 18 to 20s. So now extinguishing this at 43, how does that feel to know that this.

[Dustin]

Will be completely behind you again, things I'd Been resigned to it feels like an albatross. And been around my neck that I just got used to the weight, or people have a disability. They just feel like, oh, my pain level is X. So that feels normal. And getting rid of it now, I don't even know what that's going to feel like, honestly.

[Brian Preston]

It's going to be like a weighted vest has been taken off.

[Dustin]

It's amazing. And it's almost like I feel a sense of guilt about it. Like, I brought this into, you know, I brought this into our world, and it is what it is. And I can't undo choices that I made when I was a child, essentially, even though I was an adult. You know, you make choices and you live with them, and here we are. I'm glad to get this out of my life because I got way better things I can do. $57,000 and what a wonderful opportunity.

[Bo Hansen]

You said, oh, I didn't know what I was doing. I mean, what a great position you are now to tell Mason when he gets. Hey, son, here's how. Here's how money works. Here's how debt works. Here's the things that I wish someone could have told me at that time. I think that's awesome. So, yeah, it stinks that it happened, but you are able to take that and turn it around and use it to be something super powerful. Move. And by the way, you're only 43, which is not that old, so you've got plenty of opportunity moving forward, which I think is great.

[Brian Preston]

Just in the short term time I've gotten to know you guys. Shelby seems very generous on the fact that, like, we'll talk about the college funding in a minute and then even how we're paying off this college. I feel like you're carrying some of that guilt that she's not holding on you necessarily. So this is going to be great to have it extinguished. And you'll just. And you're also exceeding, like, your real estate income. You're way ahead of where you were even last year.

[Dustin]

Oh, yeah.

[Brian Preston]

And you just said you got another check that y' all deposited. And I loved how y' all do the savings goals. Is that months that you have big checks come in. Because being a real estate agent is not. It's not like you're getting square cubes of perfect income every month.

[Dustin]

June, July are good, but you.

[Brian Preston]

But you've been exceeding it. And it's nice. I love how you'll pay yourself first. So it's kind of pushing even more into the household, which is an awesome thing.

[Dustin]

Yeah. And we have a buffer built into the way we do our budgets so that whenever those lean months do come and prepare for it, basically after Thanksgiving. And I have to wait until January or February to get paid again sometimes.

[Brian Preston]

So y' all are equipped, though, to plan for that, it seems, based upon how y' all are allocating everything. I feel like y' all have that. Well, underhand.

[Dustin]

Yeah.

[Shelby]

And that was the other thing that I forgot. In this list, we have like 9,9000 to $9,600 that's in our savings. That's just basically three months of expenses that we need from his paycheck. So even if we get through November, December, January, we can still, like, we don't have to touch emergency fund. We don't have to do any of that. We just have it there. So that is always replenished. SEP is done for, tax is done first, then sep, then that little bucket is replenished. Then anything else from there goes into other savings goals.

[Bo Hansen]

I love it. So one of the other savings goals that you guys have said now is, okay, we've got your student loans, got your education knocked out. Now let's talk about Mason's education, right? Because that was another goal that we had. Now here is one thing you guys are going to have to sit down and figure out moving forward is like, we're kind of going through these goals in chronological order. You guys will have to figure out how, how important are the goals. Like, how do we, you know, frame the importance of these goals in terms of our long term strategy that we want to employ. But here's what we know about college funding right now based on what you told us, hey, we really want to have $50,000 saved up for Mason. We got about five years to do that, right? You guys currently have been saving 600 or $6,000 a year towards this goal. Am I understanding that correctly?

[Shelby]

Yeah. Basically I started it with 10,000 whenever I sold the house. And then we've been putting in $6,000 a year with the intention to have 50,000. Like, I calculated that out specifically figured $6,000 a year, like that should be easy enough to save. And then that would put us to the 50,000 in theory, in seven years. Like, if we have it a few years early, cool. But seven years is after he would finish community college.

[Bo Hansen]

I love it. So what we did is we said, okay, if we're actually doing this for, on this trajectory and we have $16,000 and we're going to save $6,000 a year, it's going to move us to where at age 18, even before the two years of community college, if we're just assuming a 5% rate of return. Right. Like, you know, some part cash, maybe some part growth, if you're doing a 529 or something like that, you're going to have about $54,000. Like, that's. So before college, before first two years.

[Dustin]

Start, you'd be two years ahead, essentially.

[Bo Hansen]

Yeah. So you're kind of two years ahead. So what we said is, when we look at this and you guys have to figure out your comfort level, even saving $6,000 a year might not be the absolute exact number to try to hit that $50,000 goal. You may be overfunded on this goal. What we said is, if the goal was to have the 50,000, by 18, you're already on track to have 109% of that goal funding. Right. So you're a little. I don't want to say over planning, but if the goal is 50, you're well on your way to doing that. So that's one you can kind of like put a check mark on and even think, okay, is there. Are there some dollars that we could even maybe take and reallocate, deploy to another goal elsewhere? Does that make sense?

[Shelby]

Absolutely.

[Bo Hansen]

And what I love is it sounds like you guys have already had this conversation with Mason around, hey, here's the plan. We're going to do this for the first two years, and then we're going to do this for the next two years. I think that's fantastic, having that conversation five years out. I mean, we. We talk to a lot of folks and we'll talk to their, you know, junior senior kids and be like, what do you think about college?

[Dustin]

And there's. Oh, no idea.

[Bo Hansen]

I haven't really thought about it. I love that you're starting that conversation early. That's amazing. You guys are doing a great job.

[Brian Preston]

And it's a huge head start. As you've already talked about, the little amount of debt, if you can lower the. How much debt you come out of college with, it is a huge head start in life. And that's the big thing that you're paying it forward from. By y' all setting this up for. For Mason. So that's an incredible opportunity for him in the long term.

[Bo Hansen]

Now, you've done all kinds of calculations, right? Like, you guys have given us all these numbers. Like, I've done this calculation, I've done this calculate. You did another calculation that you gave to us, said, hey, we Want to be able to retire?

[Shelby]

Oh, yeah.

[Bo Hansen]

And I have this retirement number in my head. What. What was your retirement number? Do you remember what it was?

[Shelby]

I think I told Megan, 3 million.

[Bo Hansen]

3 million.

[Shelby]

2.5 to 3, but I think 3 million.

[Bo Hansen]

So I'd just be curious, how'd you guys come up with that? Where'd that goal come from? How'd you discern that that is the magic number for the household?

[Dustin]

Again, I'll defer to her.

[Bo Hansen]

He's like, shelby told me.

[Shelby]

So that's how I found out this mysterious 4% rule.

[Bo Hansen]

Okay.

[Shelby]

My understanding is you want to. You only want to put. Pull out 4% of whatever you have in retirement per year. So that to keep it really simple, the account basically replenishes. Replenishes itself.

[Bo Hansen]

Kind of like living off the interest sort of idea.

[Shelby]

Right? So 4%, I think some people say 3. Some people might say a little bit more. I think you guys did a video. Dave Ramsey might say a little bit higher. But I think 4% is kind of what I've heard was about average. And so I think if I did a hundred thousand dollars a year at 4%, I think that's what put us at the 2.5 million number. And so I'm like, well, let's get.

[Bo Hansen]

A little more.

[Dustin]

Little.

[Shelby]

Hope's like, okay, I'm. We. I don't want to have a mortgage at that time. So like, we should have a paid off house. So we, you know, that money that we put to the mortgage, we'd be able to live. So yeah, I think we would be able to live off a hundred thousand, maybe a little bit. Yeah, a little bit more. So I put it up to three.

[Brian Preston]

And I have one more clarifier. 120,000. Is that in today's dollars or are you thinking you want 120,000 when you reach retirement?

[Dustin]

The idea is whatever that would be with guesstimated inflation or whatever.

[Shelby]

I think that that might be where. I think that might be where I'm a little confused. On the 4%.

[Brian Preston]

We have thoughts. Yeah, but it's. It's something just to share you the details. I just want to clarify.

[Bo Hansen]

It's just a really interesting thing because so obviously if you had $3 million today and you were doing the 4% thing, you live off $120,000 in today's dollars, that's $10,000 a month, which is great. Do you think you could live the life that you want to live on the way. The way that you want to live it? On $10,000 a month.

[Dustin]

I know I could. Yeah, I think.

[Shelby]

I think that we could. I mean, we live off $7,000 a month now, and 2300 of that is our mortgage. So if we nix the mortgage and that's seven plus a little bit more, I think that that would be.

[Dustin]

Yeah, to me, that's really high.

[Bo Hansen]

So that's kind of where I am arriving to. Is okay. If 7,000 is what we're living on now, and that even includes the mortgage, is our number really 3 million? Because we're going to show you. You gave us the number 3 million, and we're going to show you what would be necessary to get to 3 million. But one of the things we want you to take away from this today is. Is 3 million really the number. Is it. Or if the number is something different than 3 million, does that open up opportunities for us earlier on than maybe we had even thought would be possible?

[Shelby]

Please. I love that it. Maybe it's not 3 million. This is just. This is all based on what I've been able to piece together from YouTube University and my mom and my aunt and Google. So I am in no way like. This is why I'm so thankful that we're here.

[Bo Hansen]

I love it.

[Brian Preston]

And I was about to share, but I want to set the table. One more thing is just a financial planner's job is we try to be as conservative as possible.

[Shelby]

Yeah.

[Brian Preston]

Because it is a hard threshold when you tell a client that they can retire. So we usually put in conservative investment assumptions, meaning on rates of return, we put in inflation conservative adjustments. So I think what we're going to show you is falls under the umbrella of conservative. But that's why there's going to be some flexibility on maybe this could adapt and get to Bo's question is, is 3 million the right answer?

[Bo Hansen]

Because what we said is if right now your goal is for $3 million in today's dollars, by the time that Dustin gets to 60, 65 years old, that would generate about $120,000 of income in today's dollars. So based on where you guys currently are right now, you have a little over $200,000 currently saved up.

[Shelby]

And that's for both of our. That's for both of you, right?

[Bo Hansen]

Yep. So we're just. We're considering it a household. So when we say retirement, we're thinking about when he hits age 65, that's retirement. Just to kind of keep it simple, what we know is right now with about $200,000 or so currently saved and invested between the two of you, those dollars, without saving another dollar right now, would likely grow to about $1.34 million. Now, we just assumed a 7.7% rate of return, given your age. So already you're on track for like a million dollar plus portfolio just on the hard work you've done thus far. But you guys are still saving. You've already kind of laid out for us how you save. Matter of fact, let's look at how you're actually saving, because right now you're maxing out Roth IRAs, both of you. You said you're doing this compartmentalizing where you have this 25% of the real estate income that we're putting in the steps, that's another 20,000. And Shelby, you're putting a ton into your 401k, 21% deferral, plus a 4% employer contribution. So you guys are saving like $60,000 a year. So it's pretty stellar. So we have 200,000 saved up. If you just take that 200,000, you continue to save just this 60,000 between now and the time that you turn 65, the number turns into $4.6 million.

[Dustin]

I like overshooting.

[Bo Hansen]

So without, let's be clear, though, when you're 65, 4.6 million will not be the same as 4.6 million today. We do have to factor in inflation, because if we apply a 4% withdrawal rate to 4.6 million and then we bring it back into present value terms, that amount of money would generate about $97,000 a year for. So we haven't hit our 120 goal. We hit about 100,000 based on your current plan. But we wanted to be able to show you, okay, if Our goal is 120,000 in today's dollars, how much more we save, what's the number actually need to be? And so we figured out that if you saved an extra $1667 a month, right. That would be the magic number to save. Then by 65, you would likely hit a portfolio of around $5.8 million. And when you turn 65, 5.8 million would generate an income assuming a 4% withdrawal rate of the equivalent of $120,000 today. Okay.

[Shelby]

Okay.

[Bo Hansen]

So the summary here is, if 3 million were the magic number, which I'm not convinced that it is, but if it were the magic number, there is probably a shortfall in savings. So some of these other places you have money going, you have to find, okay, how could we save an extra 1500-1700 dollars a month in order to move in that direction. When I tell you guys that, give me some feedback. If I said, hey, you got to save an extra, because it comes up to about 20 grand a year. If you had to save an extra 20 grand a year on top of what you're doing.

[Dustin]

Well, it all comes down to me, essentially, because her salary is set. She has some, you know, bonuses and things like that. But for me, like, real estate is where the swings can get high or low. So, I mean, as I'm. I've been in real estate for six years, but I've only really been licensed for three, so, like, I'm still getting that traction underneath, even though I hit the ground running pretty well. So the idea is, if I'm making 100k on average or what my goal is annually, that that is going to incrementally step up. However that can happen. That is the only way I can see where I can. Where that money could come from, essentially, is basically another deal every month.

[Bo Hansen]

Okay.

[Dustin]

Which is. I'm happy with that anyway. That's my initial thought.

[Bo Hansen]

But it's doable. I'm hearing you say this is. It's. It's. This is doable. Right.

[Dustin]

I got it. I mean, I'm working as hard as I can. Yeah. That's. That's all I can say about that.

[Bo Hansen]

So the question that I would then ask is, is this what's necessary? So we use. It gave us the number of 3 million. The question I'll say is, okay, well, do we really? If we. Again, I'm just doing very simple math here. Right now, you guys live off of $7,000 a month. We know that 2,300, that's a mortgage. So if you take that out, you're really living on about $5,000 a month. In order for you guys to be able to retire, do you need to have twice as much of a lifestyle as you currently have? 5,000 in spending to 10,000 in spending?

[Dustin]

No. Especially when we were talking about we won't have a mortgage at whatever.

[Shelby]

We'll have a mortgage, and then Mason will be out of the house, too. So, you know, monthly grocery bill alone, a lot lower. So. No, I. I think it is realistic that less than $10,000 a year.

[Dustin]

Yeah.

[Shelby]

I also don't want. I'm like, torn. Do I think that less than $10,000, like, as we talk through this, do I think that less than $10,000 could be doable? Yes. I also don't want to look at that number and say, oh, that's too much. It has to, you know, less than $10,000. Has to be like, I don't want to short.

[Brian Preston]

Right, sure.

[Shelby]

My, you know what I mean? Like, if we need to do that maybe, like, I don't think that this is maybe quite it, but I think that less than $10,000 is probably reasonable.

[Bo Hansen]

Well, I think one of the concerns that we had as we were talking is it. It seemed like, hey, there, there's some. We're concerned. We don't know if we're gonna do all these goals. We feel like we might be behind the eight ball. We feel like maybe we haven't done the things. And so we have to catch up. Have to catch up, have to catch up. What we actually recognize is that you guys are doing a lot of stuff really, really right. And you're moving in a really, really good direction. I hope that that's fuel to keep you moving in the right direction. Less so than this burdensome thing of, oh my gosh, it's not going to work out. Because for all intents and purposes, you guys, yeah, maybe the beginning wasn't exactly the way you would have drawn it up, but at this point, you guys have a great plan in place.

[Dustin]

Okay.

[Shelby]

And that's what I needed to hear, really. I needed someone to look at everything and say, okay, all good. Like, everything will be fine. Because I don't know, I just get into a tizzy of it's not enough and it's not enough and it's not enough and we're behind and I don't know if we're ever going to be able to catch up and all of that.

[Brian Preston]

And I heard you echo some of that, that concern as you feel in behind and I know you're, you know, kind of carrying the weight of this, organizing it. I would encourage y' all to think about it in bands of where you could go on. You could have a minimum amount that needs to be funded every year and you could have the aspirational amount because you already practice a forced scarcity type structure where this thing is an automated process to where if you have extra money coming in, you're pulling it in. It's not just going out the door into extra consumption naturally. So as long as you're hitting those minimum numbers, kind of what you. Where you already were, that was already going to take you over $4 million. But then in the good years, as you get more and more traction in the real estate industry, yeah, why not see if we can hit some of the stretch goals because then that allows you to maybe even reevaluate your goals, reevaluate what you, you know, are the trips bigger? Is lifestyle a little bit better? Is it okay that we're replacing the cars a little bit sooner? All these things kind of come into play after you make it past the minimum and you start hitting more of those aspirational goals.

[Shelby]

I think the other part of the question that I have talking about the retirement as a household, it's great. I don't know if it takes into consideration the fact that we're 10 years apart in age. So I want to make sure that he, there's enough money in his name.

[Bo Hansen]

Sure.

[Shelby]

That whenever we get to that point, if I want to retire a little bit early or that there is just enough for both of us to live off of until my retirement accounts hit the age where I can start actually pulling money out. Yeah, exactly. So I think that's the other part that I'm kind of like, it's, it's a, it's a concern a little bit, but I don't know exactly how to like, verbalize that and how to look at it. So I don't know if you have any insight on that for sure.

[Bo Hansen]

Well, one of the things that we did is we put together a little bit. It's sort of like a pseudo foo for you in terms of how you guys think about your retirement savings. Because right now we know that you're going to max out the Roth IRAs. You're going to do that 7,000, 7,000. We also know that we're going to do retirement contributions for both of you. So we're going to do 401k for Shelby. You're already doing that. The 21 plus the 4. And we're going to do some sort of retirement contributions for Dustin. So it's going to be either the SEP ira, which is a great solution. We would probably say a solo 401k might be a better solution because then you can also do salary deferrals throughout the year and it's going to help for budgeting. Like, hey, I know you're maxing out your 401k and I'm maxing out my 401k and then whatever you have left over, then you can do the profit sharing type stuff similar to the way that you do the sep, but you've already kind of, instead of mentally accounting and having to put it in a bucket to the side, you can just fund it in real time every time a check comes in. And then you have this other additional investing and this is the part where.

[Brian Preston]

I think this is what she's getting at.

[Bo Hansen]

Where you're, the question you're asking is, hey, I want to make sure that our gap functions. The fund that's going to cover between whenever I retire, he retires and I'm able to actually access my, access my assets. You guys are gonna have to prioritize how you fund those buckets. It's why we talk about inside of step seven. Step seven becomes once you're at that 25% savings rate, you really got to think about how you're going to use the money. And you guys may arrive at the conclusion to okay, yeah, we could do profit sharing into Dustin Solo 401k. But that doesn't make as much sense because we ought to be putting this in the after tax brokerage account and we ought to be building a gap fund and that might be where that extra $20,000 a year goes into. And you can imagine if you put $20,000 into that gap fund over the next 20 years, you're talking about probably approaching seven figures just in that singular fund to be able to bridge that gap until you get to 59 and a half.

[Brian Preston]

A lot of modeling could be done on this. But you're very smart. You have great instincts in the thought that look with the 10 year age gap and then Dustin is having to build this up, will it get to a critical mass that it will cover both of you since you, your assets won't be at the retirement age, there's still you can annuitize a portion of your IRAs. But I love the thought of y' all building this bridge account with taxable money because that just makes it more flexible for retiring whenever you want. But it's also going to open up other opportunities as y' all just need more access points to money. Whether it's investments or it's cars or it's lifestyle, the taxable account is just so easy to get to. Whereas sometimes retirement accounts, we love them. That's why in the financial order of operations really when you get to five and six, even two, these are all very tax favored savings opportunities. It is exactly what Bo said. Seven is where you're thinking about how do we need to use this money? And maybe we back into the math of we make sure the account structure works that way because it's easy when you're younger. Let's you know, let the government fund this through tax savings. But as you're getting closer and closer, you want to say wait A minute. Let's start thinking about how we can use this money in a tax efficient way as well.

[Shelby]

That makes a lot more sense. And I think that was kind of the idea with the Fidelity, the money market account before you realize that all that has to be paid sooner rather than later. It's like, okay, well some of that can be invested and like we can start that brokerage account. We're just gonna be set back a little bit, but we'll still, you know, we'll fund that again and we'll keep it in that brokerage account. Taxable brokerage account. That savings goal could be part of. It's not. It's not an additional fifteen hundred dollars a month plus whatever we were trying to save anyway. Like, we're already saving the fifteen hundred dollars a month.

[Bo Hansen]

Just a matter of where you're saving, right? Where are you putting it?

[Shelby]

So that's not as intimidating to me. I guess for some reason I'm thinking like, we already do the 1500 and then we have to double what we're saving every month. Okay, that's a little bit like where are we gonna. Where are we gonna cut down on things? I really like to do Pilates and I don't want to do I make a decent income. I want to do some things not extravagant. Okay. So that makes me feel a little bit better now that I'm understanding it a little bit differently. Do you have questions on it?

[Dustin]

Well, I need to ingest it. Really, I need to see it.

[Brian Preston]

Well, you had asked a question earlier, Shelby, about when do you know when's cash and when to invest. And I just want to give you some general guidelines is that. But when things are within 18 to 36 months, it's a no brainer. Keep that in cash. So if you have any goals and your instincts were already telling you about that, and that's why even when we talk about the college savings that's about five to six years, that's the only one that's kind of in that gray zone that you probably want to do a very conservative mix to where maybe a portion of it could be invested, but a large chunk of it is going to stay very liquid. Because when you get into that five years, that's starting to feel kind of mid level goals that you can start investing in and then beyond seven years, let it rip. That you can actually do diversified equity type investments because you should have enough time there to kind of live out whatever volatility is coming your way. But that's the way you. Because what you're trying to avoid is having to make a desperate decision of selling something at the world's worst time. If there's a volatile period.

[Shelby]

Right. Which, to answer your question from before, why are we so cash heavy? That's kind of. That's the answer. Because everything that we were looking at, obviously, emergency fund, we want to have fair, that's got to be liquid. Right. And then car fund, college, like you said, kind of toes the line. Student loan, like, it felt like everything was kind of the next two years ish, that we would want to have it available anyway. So that's why I was on the fence about, you know, should we invest this or should we not? So, I mean, I have it in some CDs and high yield savings, some different things that are getting a little bit better interest than what just our high yield savings is. But still, I can pull it if I need to without penalty.

[Bo Hansen]

And we think about the 1500, like that extra savings that you guys might do in that Gap account, We'd love for that to be invested. That would not be like a cash holding. That would be like a true equity type investment.

[Shelby]

Right.

[Bo Hansen]

So that it can grow. Because one of the beautiful benefits of being 33 and 43 years old is your wealth multiplier is still super, super strong. So, I mean, cash yields are great, but you got to get the money working if you want to be able to capitalize on the wealth multiplier.

[Shelby]

Right, yeah. So that makes sense.

[Brian Preston]

And then on goals, because that's the other thing, because I love that you do systems where you kind of like set it and forget it and it's automated. I love how you're doing that. But a lot of times when people set automated systems, they let them on autopilot for too long. You will need to look at goals like the education funding, because he's so close that you won't be five years long, it will be three years soon. And then you're like, well, okay, more of this needs to be cash. And then you'll start, you know, curtailing or coming out of some of those equity investments at that point.

[Shelby]

Which leads me into a controversial in my upbringing conversation about five 29s. Okay. My mom and dad both set aside oodles of money into 529s for my brother, sister and I.

[Brian Preston]

Right.

[Shelby]

I was the only one that went to a traditional college. And even then I did it like later in life. And so my mom has this. This, to me, it seems very, like when she talks about. It seems like very stress of like, there's tens of thousands of dollars stuck in these 529s that I can't pull out because no one's going to school. And so, you know, some of it can be used for Mason. Some of it can be used for my niece and nephew. Like, great. But I don't want to be stuck in that position now since talking to my aunt. My aunt has kind of enlightened me on it. She's. My aunt's. Like, she can pull it out if she just paid the penalty. Like, she's being cheap. So.

[Bo Hansen]

And that's. And it's penalty and taxes only on the earnings, not the money that she put in there. So, like, there are ways, like, you. Yes, you can get that money. And the tax laws have even now changed in the past couple of years where those dollars can even flow into a Roth IRA for the beneficiary.

[Shelby]

And so now I'm kind of thinking my mom is extremely frugal, which is part of how she has made this amazing life for herself. And she's financially secure, but she lives as if she's at a.

[Bo Hansen]

She's going to run out tomorrow.

[Shelby]

No, she's a financial adviser.

[Brian Preston]

A little bit.

[Shelby]

A little bit. And she's gonna watch this. And I'm sorry, Mom.

[Brian Preston]

There's a fine line there. I love that you're calling her out on it, though.

[Shelby]

And, I mean, her house is paid off, like, but she never remarried. Like, she's very independent, and so I get a lot of that from her. But I have to remind myself, like, I don't want to be all. Like, I want to take the good qualities of that and still live my life. And so I find this. I try to find this balance anyway, the 529. It's like, how much of it should we. Behind the scenes, Mason's in the room hearing this conversation. And, I mean, we'll put aside $50,000, but if he decides not to go to school, I'm not just going to give him $50,000.

[Bo Hansen]

Sure.

[Shelby]

Right. That's for school.

[Brian Preston]

It can be used for trade school. Yeah, it can be used. There's all kind of opportunities. They. Most improved account structure is 529s, because even. Even the most recent tax legislation, if you had K through 12 education goals, they went from $10,000 a year funding to now $20,000. So, you know, and that. That pertains to. If you wanted to pass it down to relatives and others. So there's lots of ways to kind of clean out a 529 and without paying taxes.

[Shelby]

And so that's what I'm thinking of maybe like putting part of it in a 529 and then keeping part of it maybe in more of like a traditional savings or investable, like something like that.

[Brian Preston]

Well, your goal's not that crazy. 50,000 for education is not the wildest thing.

[Dustin]

Right. He's not going Ivy League.

[Brian Preston]

Run a huge risk of overfunding the cost of college. College, I think can't keep running at the cost that. I mean, going up every year with inflation like it is. But I do think it's going to be expensive. And I'm not for the foreseeable future.

[Shelby]

I'm not so worried that the $50,000 would be more than what he would need for college. My concern is if he chooses not to or if he chooses to do trade school. I'm a cosmetologist. We didn't talk about my career, but I went. I did trade school. Like, that's my career. And I did university and all of that later. So I am all for trade school. And so if that's what he wants to do, I fully support that. I just don't want to have all this money.

[Brian Preston]

The 529 get here.

[Bo Hansen]

Here's a real good number. Right. $35,000 is what can be used in a Roth IRA, right. That's what you could do. So if all you did is that. Okay. Of the 50, we want to target no more than $35,000. Being in the 529, you at least have an escape hatch that could be rolled into Roth IR over the next number of years.

[Shelby]

Okay.

[Bo Hansen]

So that gives you like eight.

[Shelby]

That's a good.

[Bo Hansen]

There is no, like, right or wrong answer there. But you can play some, like, mental math to prevent yourself from thinking you're going to overfund it if he chooses not to go.

[Shelby]

Yeah.

[Bo Hansen]

Or does some other. Some other type of education.

[Shelby]

Okay. And I will say my mom, actually, she has gotten very. While she doesn't want to pay the penalty and taxes and all of that, she has gotten very creative. And I went back to school and got grad school and all of that in more recent years. And she passed. Paid for all of that. I'm super thankful. But she actually pulled. She was able to pull 10,000 out to put towards his student loan. So that 57,000.

[Brian Preston]

Part of the provision, like 67,000 approved account. I mean, I love these.

[Shelby]

Our wedding gift was a $10,000 contribution to. So she is trying, but she does not want to pay the Penalties on it. So Mason and my niece and nephew and all of them will have some extra money for college, too. I just don't want to. Obviously, we don't want to depend on that.

[Dustin]

Sure.

[Shelby]

It's. I don't want to depend on anyone else's money. If it comes, great. If not, we're set. Okay, so that's a good 35,000. About give or take. That's a good number to have in a 529. And then maybe potentially the other 15 have it in a taxable brokerage account.

[Bo Hansen]

Sure.

[Shelby]

Or high yield, depending on how far it is. More high yield savings.

[Dustin]

Right.

[Bo Hansen]

All right, guys, are you ready for your homework?

[Shelby]

Yes.

[Bo Hansen]

You guys are doing great. There's not a lot here. Priority number one, we think you ought to probably go and pay off the student loans. Deferment ends in or interest starts in January. So let's go and get that knocked out. The other thing you guys should do is spend some real time figuring out what your number is like. Okay? 3 million is a number. Realistically, what do we want to spend traveling? What are we going to do when we retire? How are we going to live life to at least give you something to work towards? There's nothing says that that has to stay your number, but at least allows you to know what you're working towards. On the retirement side, figure out, is there another type of account I should be using? Like a Solo 401K? We love it. It just gives you more options than a SEP IRA. Except IRAs are great and they're wonderful, but solo 401k, just give you a few more options, which is wonderful. And then I said, decide where to save. Okay. For college, are we going to put it in the 529 or are we going to leave it in a high yield account? Are we going to have it in cash? How can we do that? For the extra savings we're going to do, we're going to put in a taxable bridge account. Are we going to try to do it inside of some sort of retirement plan? Figure out how we're going to use those documents. Dollars. And then you reverse engineer where to fund the dollars.

[Brian Preston]

Shelby, thank you for coming on. Dustin, thank you. This has been an absolute pleasure. And I love that we actually got to show that you're going to reach your goals and become true financial mutants with all your discipline. Guys, thank you so much for tuning in. I'm your Host, Brian Preston. Mr. Bo Hansen. Money Got Team Out.

[Bo Hansen]

Making a Millionaire is hosted by Brian Preston and Bo Hanson, Brian and Bo are part of the Partners at 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 Making a Millionaire. 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. The guests featured on Making a Millionaire are not clients of Abound Wealth Management at the time of recording. Their participation should not be considered a testimonial or endorsement of Abound Wealth Management.