Rich Habits Podcast — Episode 155

"The Advice Your Parents Gave You That’s Now Wrong"

Hosts: Austin Hankwitz & Robert Croak
Date: February 2, 2026

Episode Overview

This episode dissects the classic financial advice handed down by previous generations and reveals why much of it no longer applies today. Austin and Robert break down the three biggest outdated money rules, explain why the economic landscape has shifted, and present modern strategies to build wealth in 2026 and beyond. The discussion is candid, practical, and full of actionable tips—whether you’re new to personal finance or aiming to level up your habits for long-term prosperity.

Key Discussion Points & Insights

1. Why Your Parents’ Financial Advice May No Longer Work

• Context Shift:
  • Previous generations operated in a vastly different economy: home prices were lower relative to incomes, pensions were common, savings yields were higher, and stock market returns were stronger.
  • Quote (Austin, 01:42):
    “If your parents are right now in their 50s or 60s, or maybe even their 70s, they entered the workforce when the average home only cost three times the median income. Today it's five to six times... That world, Robert, is gone.”
• Key Point:
  • Advice that created middle-class wealth in the '80s and '90s may now leave you treading water or even falling behind.

2. Outdated Advice #1: “Buy a House as Soon as Possible; Renting is Throwing Money Away”

Why It’s Outdated:

• Homeownership costs have skyrocketed, down payments are unattainable for many, and opportunity cost is often ignored.
• Math Discussion (03:19-04:13):
  • Buying a $400,000 house with 10% down = ~$3,000/month including extra costs.
  • Renting same property = ~$2,200/month.
  • Investing the $800/month difference at 9% over 30 years = $1.4M, versus the house appreciating to $1.1M.

Modern Approach:

• “Buy a house when the math works—not automatically, and not at the expense of your investment future.”
• Criteria:
  • 20% down payment (without touching retirement savings)
  • Housing payment under 25% of gross salary
  • Plan to stay for at least 7 years
• Quotes:
  • "Renting isn’t throwing money away; it’s paying for flexibility and the ability to invest elsewhere."
  • “Every dollar trapped in your house as equity is a dollar not invested in the S&P 500.” (Robert, 04:52)

Memorable Segment:

• Austin emphasizes he himself is saving for a home in 2026, but only because the numbers add up for his situation. (05:33)

3. Outdated Advice #2: “Stay Loyal to Your Employer”

Why It’s Outdated:

• Companies no longer offer long-term security, regular meaningful raises, or pensions.
• Stat (Austin, 08:10):
  • Staying >2 years at the same company = earn 50% less lifetime compared to job hoppers.
  • Typical annual raise: 2-3%; Job hopping: 15-30% increase.

Example Calculation (08:27):

• $60K salary stays 5 years, gets to $69.5K
• Job hops every two years; ends up at $87K—$17,500 annual difference

Modern Approach:

• “Be professionally promiscuous.” Switch jobs every 2–4 years, especially early in your career.
• Evaluate total compensation, stock options, and benefits carefully—not just job title or “loyalty” offers.
• Build and leverage your network: always leave on good terms as past bosses may become future allies.
• Quotes:
  • “Loyalty is to your career, not your employer.” (Robert, 20:06)
  • “You’re not being disloyal, you’re being strategic to yourself.” (Robert, 09:35)
• Advice for Startups:
  • Beware of private stock options—they may become worthless if the company doesn’t go public or exits successfully.

4. Outdated Advice #3: “Go to College No Matter the Cost”

Why It’s Outdated:

• College costs have exploded (from ~$3,000/year in 1980 to $25K–$44K/year in 2026), but the wage premium has flattened.
• Many grads are underemployed, burdened with debt, and could have earned more in skilled trades without a degree.
• Stat (Robert, 12:37):
  • 40% of recent grads are unemployed or in jobs not requiring a degree.
  • Average student debt: $30,000.

Modern Approach:

• Always calculate ROI before committing.
• Only attend college if essential for your chosen career (doctor, engineer, lawyer, etc.).
• Minimize costs:
  • Start at community college
  • Stick to in-state schools
  • Pursue scholarships and employer assistance
  • Pick majors that pay
  • Avoid debt for low-earning fields if possible
• Trades should be strongly considered: electricians, plumbers, and similar “blue-collar” jobs can out-earn many degree programs with less debt.
• Quote:
  • “Skills matter more than degrees in almost every situation.” (Robert, 20:14)
  • “The key here is that it’s different for everyone.” (Austin, 10:14)

5. The New Financial Playbook: 2026 and Beyond

Summarized Steps:

• Prioritize investing over home ownership until the math works for your situation.
• Change jobs strategically every few years for the biggest earnings leaps.
• Treat higher education as an investment: only pursue if ROI justifies it; otherwise, explore lucrative alternatives.
• Leverage technology, side hustles, and modern platforms (e.g., social media, digital products) to diversify income.

6. Messages of Hope & Opportunity

Mindset Shift:

• The game has changed—accept the new rules.
• Don’t dwell in doom and gloom; opportunities are more abundant than ever due to technology and new economic models.
• Quotes:
  • “Following their playbook is like using a roadmap from 1985... the highways have changed over the last 40 years.” (Austin, 17:42)
  • “We are not playing the same game our parents played. We are playing life on expert mode and it is kicking our butts.” (Austin, 17:42)
  • “We are not victims. We are victors... There’s a lot to be hopeful about.” (Austin, 18:02)
  • “I am so excited every single day to be alive and... to be able to build wealth as an individual.” (Robert, 19:05)

7. Community Q&A Highlights

Q1: When to Form an LLC for Your Side Business? (25:43–29:34)

• Get the business going and see revenue before forming an LLC (unless you’re highly confident).
• Once there’s a clear path to meaningful profit, set up an LLC for liability/tax perks.
• Tips: Use a generic LLC name for future flexibility; always keep a separate business bank account.

Q2: Investing a Nest Egg for a Future Home (4–5 years away) (29:34–31:41)

• Don’t keep too much in cash for such a medium-term goal.
• Suggestion: 50–60% equities (VOO), 10% dividend stocks, 10% bonds, 10% treasuries.
• Shift towards cash/T-bills 12–18 months out from buying.

Q3: Retirement Drawdown and Lifestyle Support (31:41–37:13)

• Combine Social Security, portfolio withdrawals (4% rule), investment dividends, and income from a business for optimal cash flow.
• Adjust allocation from 100% stocks to ~60% stocks/40% bonds for lower risk at age 69.
• Work with a CPA or advisor for tax optimization.

Notable Quotes & Memorable Moments

• “Every dollar trapped in your house as equity is a dollar that is not invested in the S&P 500.” – Robert (04:52)
• “People who stay at the same company for more than two years earn 50% less over their lifetime compared to job hoppers.” – Austin (08:10)
• “Only go to college if the career specifically requires it and the math works in your favor.” – Robert (13:56)
• “We are not victims. We are victors. We are always victorious over here.” – Austin (18:02)
• “Loyalty is to your career, not your employer.” – Robert (20:06)
• “Following their playbook is like using a roadmap from 1985 and it’s hard to do that because the highways have changed over the last 40 years.” – Austin (17:42)
• “Skills matter more than degrees in almost every situation.” – Robert (20:14)
• “There are thousands more opportunities in today’s economy to make and grow money if you know where to look.” – Austin (17:42)

Timed Highlights & Segments

• 01:42 – The contextual gap between your parents’ economy and 2026.
• 03:19–04:13 – The rent vs. buy math breakdown.
• 08:10 – Real numbers on job-hopping vs. long-term loyalty.
• 12:00–13:21 – Exploding college costs and diminishing returns.
• 17:42–18:02 – The change in “the game” and importance of adapting.
• 25:43–29:34 – Starting an LLC for your side business: timing and tips.
• 29:34–31:41 – Investing for a house in the mid-term future.
• 31:41–37:13 – Navigating a high-spend retirement with investments.

Episode Tone & Closing Encouragement

• Candid, hopeful, often humorous—Austin and Robert riff on their age gap, shifting financial realities, and personal stories.
• Always practical, never fearmongering.

Final Words (Austin, 22:24):

“If your life is not exactly what you want it to be, spend your weekends building the life that you want to live… Build your dream life. The people who have the life you want will never judge you for trying.”

Listen to this episode for a full breakdown of what to unlearn, what to relearn, and how to thrive in the new financial reality.