Rich Habits Podcast Episode 125: "The Habits That Made Our First $1M"

Release Date: July 7, 2025
Hosts: Austin Hankwitz and Robert Kroke
Duration: Approximately 38 minutes

Introduction

In Episode 125 of the Rich Habits Podcast, hosts Austin Hankwitz and Robert Kroke delve into the foundational habits that propelled them to their first million dollars. Catering to listeners who have already laid a financial foundation and are aiming to scale their wealth, this episode offers actionable insights and personal anecdotes to inspire and guide listeners on their journey to financial abundance.

Habit 1: Meticulous Tracking of Finances

Timestamp: 02:37 - 05:11

Robert Kroke emphasizes the importance of diligently tracking every aspect of one's finances—earnings, spending, savings, and investments. He underscores the adage, "What doesn't get tracked gets spent," highlighting that without precise tracking, even substantial incomes can dissipate unnoticed.

• Key Points:

  • Consistent Tracking: Robert maintains a detailed Google Sheets workbook documenting his financial activities since 2021, illustrating the effectiveness of this habit in achieving millionaire status.
  • Income vs. Expenses: While income growth accelerates wealth accumulation, unchecked spending can negate these gains. Tracking ensures that income is allocated wisely towards savings and investments.
  • Mindset Shift: Moving from a reactive to a proactive financial approach—wealthy individuals forecast and plan ahead, ensuring sustained growth.

• Notable Quote:

  • Robert Kroke (05:11): "Wealthy people forecast. We want you to be a wealthy person that is forecasting into the future."

Habit 2: Taking Control of Your Life

Timestamp: 05:11 - 13:03

Austin and Robert discuss the peril of "drifting through life," where individuals lack a clear plan and merely react to circumstances. They advocate for a proactive approach where one "happens to life," shaping it according to personal goals and aspirations.

• Key Points:

  • Purposeful Living: Instead of following a generic life path (education, job, etc.), define personal goals that align with one's vision of success and happiness.
  • Overcoming Imposter Syndrome: Recognize and combat feelings of undeserved success. Embrace the mindset that "anything you want to do, you absolutely can do."
  • Winner vs. Loser Mentality: Winners react constructively to setbacks, while losers make excuses. Adopting a winner's mindset is crucial for sustained financial and personal growth.

• Notable Quotes:

  • Austin Hankwitz (08:00): "What we're trying to say is income's important. You can go make $10 million a year, but if you aren't tracking that income, if you aren't tracking your expenses, tracking your savings, tracking your investments, you're still going to be broke."
  • Austin Hankwitz (10:54): "There is a winner's mentality and a loser's mentality. And loser mentality is things happen to them, they get festered up, they have all these, you know, feelings, and they get so upset and they come up with excuses as to why they can't achieve things."

Habit 3: Practicing Frugality and Intentional Spending

Timestamp: 13:03 - 17:01

The hosts highlight the significance of frugality—not as a means of being cheap, but as a strategy for intentional and meaningful spending. This habit ensures that money is preserved and allocated towards happiness-inducing purchases rather than wasteful expenditures.

• Key Points:

  • Intentional Spending: Allocate funds to experiences and items that genuinely bring joy, such as Austin's $450 dinner with Robert, rather than frivolous purchases like frequent shoes.
  • Frugality vs. Cheapness: Frugality involves thoughtful spending, whereas cheapness is about minimizing expenses indiscriminately.
  • Building Wealth Post-Million: Even after reaching a million dollars, maintaining frugality ensures continued financial growth and prevents unnecessary expenditures.

• Notable Quotes:

  • Austin Hankwitz (15:15): "Once you have money, you shouldn't just spend it because you have it. You should spend it because what you're spending it on makes you happy."
  • Robert Kroke (15:15): "Wealthy people are very intentional with their spending because they understand the opportunity cost of spending it."

Q&A Highlights

The latter half of the episode features a dynamic Q&A session where Austin and Robert address listener queries, providing personalized advice grounded in the three rich habits.

Question 1: Achieving Financial Dreams While Investing Consistently

Timestamp: 18:40 - 21:50

Listener: Brad R.
Profile: 34 years old, $175K annual income, substantial investments, seeking advice on financing a summer lake house without derailing investment goals.

• Advice from Robert:

  • Earmark Funds: Allocate dedicated savings towards the lake house through high-yield savings or investment accounts to ensure the money continues to grow.
  • Optimize Earnings: Ensure that funds set aside for the lake house are actively earning, especially if the goal is more than two years away.

• Advice from Austin:

  • Investment Framework: Continue investing 15-20% of post-tax income ($20K-$30K annually) while setting aside funds for the lake house.
  • Balancing Priorities: Emphasize intentionality in spending—prioritize investments while allowing for meaningful purchases that enhance happiness.

• Notable Quotes:

  • Robert Kroke (20:12): "You want to make sure that the money is actively earning."
  • Austin Hankwitz (21:50): "Money is making decisions that make you happy."

Question 2: Managing RSUs and Maximizing Investments

Timestamp: 21:50 - 29:33

Listener: Tyler L.
Profile: Mid-30s, dual-income household ($200K/year), significant investments, seeking guidance on handling Restricted Stock Units (RSUs).

• Advice from Austin:

  • Maximize Contributions: Prioritize maxing out Roth IRAs and 401(k)s before allocating RSU proceeds to brokerage accounts.
  • Strategic Investing: Recommend investing RSU proceeds into index funds and ETFs via platforms like Public.com to ensure consistent growth.

• Advice from Robert:

  • Debt Management: Suggest prioritizing the repayment of high-interest debts over additional investments, emphasizing the importance of eliminating liabilities to secure financial freedom.

• Notable Quotes:

  • Austin Hankwitz (25:45): "If you can afford to do both, then you're good to go."
  • Robert Kroke (28:41): "You can't out invest high interest debt."

Question 3: Aligning Financial Goals Within Marriage

Timestamp: 29:33 - 36:30

Listeners: Kyle J. and DJ
Profile: Early to mid-40s, combined income considerations, overcoming past investment failures, aiming for smart financial growth.

• Advice from Austin:

  • Unified Approach: Encourage joint financial planning and leveraging both partners' discretionary incomes to accelerate debt repayment.
  • Consistent Investing: Once debts are cleared, emphasize the importance of sustained investment contributions to build a robust retirement fund.

• Advice from Robert:

  • Debt Consolidation: Advocate for consolidating efforts to eliminate high-interest debts swiftly, utilizing collaborative financial strategies.
  • Emotional Alignment: Highlight the necessity of open communication and mutual support in financial endeavors to prevent discord and ensure collective success.

• Notable Quotes:

  • Austin Hankwitz (35:22): "It's a tactical example. $25,000 of high interest credit card debt at 30% is $625 a month."
  • Robert Kroke (36:30): "Combine and conquer, not divide and conquer."

Conclusion

Episode 125 of the Rich Habits Podcast offers a comprehensive exploration of the key financial habits that can transform one's net worth. By meticulously tracking finances, taking proactive control of one's life, and practicing intentional frugality, listeners are equipped with the tools necessary to ascend to millionaire status and beyond. The engaging Q&A session further personalizes these lessons, addressing real-world financial dilemmas and reinforcing the podcast's commitment to fostering rich habits for sustained wealth.

Notable Quotes Summary:

• Robert Kroke: "Wealthy people forecast. We want you to be a wealthy person that is forecasting into the future." [05:11]

• Austin Hankwitz: "What we're trying to say is income's important. You can go make $10 million a year, but if you aren't tracking that income, if you aren't tracking your expenses, tracking your savings, tracking your investments, you're still going to be broke." [08:00]

• Austin Hankwitz: "There is a winner's mentality and a loser's mentality. And loser mentality is things happen to them, they get festered up, they have all these, you know, feelings, and they get so upset and they come up with excuses as to why they can't achieve things." [10:54]

• Austin Hankwitz: "Once you have money, you shouldn't just spend it because you have it. You should spend it because what you're spending it on makes you happy." [15:15]

• Robert Kroke: "You can't out invest high interest debt." [28:41]

For those eager to cultivate rich habits and elevate their financial literacy, Episode 125 serves as a valuable blueprint. By internalizing these habits and applying the personalized strategies discussed, listeners are well-positioned to take substantial strides toward financial independence and enduring wealth.