155: The Advice Your Parents Gave You That’s Now Wrong

Summary

Rich Habits Podcast — Episode 155

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

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

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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 Austin and Robert break down the three biggest outdated money rules, explain why the economic landscape has shifted, and present modern strategies to build wealth in 2026 and beyond.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.

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Key Discussion Points & Insights

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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.

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 Outdated Advice #1: “Buy a House as Soon as Possible; Renting is Throwing Money Away”

Why It’s Outdated: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)

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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.

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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)

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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.

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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)

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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.

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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)

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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.

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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.”

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

Transcript

[A]

Well, the holidays have come and gone once again. But if you've forgotten to get that special someone in your life a gift, well, Mint Mobile is extending their holiday offer of half off unlimited wireless. So here's the idea. You get it now, you call it an early present for next year. What do you have to lose? Give it a [e-mail] Switch limited time 50% off regular price for new customers. Upfront payment required $45 for three months, $90 for six month or $180 for 12 month plan taxes and fees. Extra speeds may slow after 50 gigabytes per month when network is busy. See terms. Hey everyone and welcome back to the Rich Habits podcast, a top 10 business podcast on Spotify brought to you by public.com by the end of this episode, you'll know exactly which pieces of your parents financial advice to keep, which to toss and what to replace them with for building wealth in 2026 and beyond. My name is Austin Hankwitz and I'm joined by my co host Robert Kroke. Robert is a seasoned entrepreneur with lifetime revenues of over 300 million. And I'm multimillionaire in my late 20s with a background in financ, as the show name might suggest. Every episode we talk about Rich Habits as they relate to business, finance and mindset. Robert, we're going to ruffle some feathers in this episode. I got a funny feeling of it. So why don't you share with our listeners exactly what we're going to be talking about?

[B]

Absolutely. In today's episode of the Rich Habits podcast, we're tackling something that for sure is going to ruffle some feathers. And that is all that financial advice your parents drilled into your head while growing up. That's hindering your ability now to to build generational wealth. And before anyone gets upset and comes for us in the comments, let me be clear. Your parents weren't wrong. They were absolutely right for their economy. Key phrase, their economy.

[A]

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. They worked when a pension existed and when you can work at one company for 30 years when a savings account was paying like 5% interest and the stock market went up 8 to 12% per year. That world, Robert, is gone.

[B]

The advice that built middle class wealth in the 80s and 90s will keep you middle class or worse in today's economy. We're going to break down the Three biggest pieces of outdated advice Explain why they don't work anymore and give you the modern strategies that'll actually help you build wealth in today's financial world.

[A]

Sounds good to me, Robert. So let's just jump right into things. The first piece of outdated advice that we got from our parents that just doesn't really work anymore is buy a house as soon as possible, because renting is throwing money away. This made perfect sense when your parents bought their first home for $80,000 with a 3% down payment and watched it triple in value over the following 20 years. But today's reality is a pretty different story. The median house price in the US is now $430,000. That's a $86,000 down payment at 20% when you add in closing costs and everything else that comes with buying, probably need to come up with north of $100,000 of cash just to get in the door. The average millennial right now listening to the show doesn't have a hundred thousand just to go buy a house with real quick. They've got several thousand in savings and student loan debt.

[B]

Yeah, and even if you can buy, the math doesn't always work in your favor these days. Say you buy a $400,000 house with only 10% down. Your mortgage at 6% is about 2,200amonth, and with property taxes, insurance, maintenance fees, HOA, you're at about 3,000 DOL dollars monthly. Now compare that to renting the same house for $2,200 a month and investing that $800 difference over 30 years. If you invest that $800 monthly at a 9% return, you would end up with $1.4 million in your pocket. Meanwhile, that $400,000 house, appreciating at the historical average of 3.5% annually is only going to be worth about 1.1 million. So you actually come out ahead, renting and investing, not to mention the hundreds of thousands of dollars in interest you'll be paying along the way on that mortgage.

[A]

So here's the modern approach we gave you the old outdated advice your parents told you, which was go buy a house. Renting is throwing money away. The modern approach that we think the Rich Habits community should be following is buy a house when the math works for you and your situation. Not as soon as possible, because renting is wrong. Only buy a house when you can afford it without destroying your investment capac. That means having 20% down without touching your retirement accounts, perhaps even keeping your total housing payment per month under 25% of your gross salary and living somewhere for at least seven years, if you can.

[B]

I think that's a great point, because so many people, when they're buying a home, they just look at the mortgage and the insurance and they don't look at the total ownership cost, and they end up being housebroke for sometimes decades because they can't get ahead of it. But let's also not forget about the opportunity cost. Every dollar trapped in your house as equity is a dollar that is not invested in the s and P500 and the other funds we talk about. And your house might only appreciate 3 to 4% annually, whereas the stock market has averaged 10% over decades. So you have to do that math because we always want the positive arbitrage of your money working as hard for you as you work to get it.

[A]

At the end of the day, Robert, we're not saying to don't go buy a house. I'm gonna go buy a house in 2026. I'm saving for a house. I'm ready to go do this next part of my life here, buying a. If it makes sense and you can still invest and you're not over leveraging yourself and you're like right now with interest rates at high fives, low sixes, that monthly payment, when you add on all the stuff, is $3,000 for the median $400,000 house. You can go rent right now for 1800, 2000, 20, 400amonth until you're ready to actually go buy that house that you plan to stay in for 7, 8, 9, 10 years, where the capital appreciation and debt payoff against that mortgage will start moving in the right direction and in your favor.

[B]

And REM episode is all about modern tactics that work today, not what worked 20 or 30 years ago. You've all heard us talk about the importance of diversifying your investments for a while now. And there could be a major opportunity today in private market real estate, especially with market timing right now.

[A]

We just talked about how you should be very prudent when it comes to investing in real estate, because we know a lot of hassle comes with being a landlord and of course, requires a ton of that upfront cash. So when it came to finding a way for us to all invest in real estate, we're focused on finding an option everyone can have access to. You can now become a real estate investor, whether you have $50 or $50,000, and you'll have an entire team looking for opportunities to add to your portfolio. With today's sponsor, the fundrise Flagship Fund.

[B]

You'll gain access to the potential returns of real estate without the headaches of property management or maintenance. So check out the link in our show notes below. To become a real estate investor today.

[A]

And as always, carefully consider the Fundrise Flagship funds investment material before investing, including objectives, risks, char, expenses. This and other information can be found in the Fundrise Flagship funds [e-mail] Flagship and Robert, if you're renting and you're like, listen, I want to be in the real estate game, go to Fundrise. Go, go do your rent thing. Go do that till you can go actually afford a home. But be investing in real estate along the way. Invest in the stock market, right? Be investing while you are renting. That's the key here. And we think fundrise helps you do that. So, Robert, take us to our second piece of outcome. Outdated advice that our parents gave us growing up.

[B]

That's right. Stay loyal to your employer. Another common piece of advice that worked for previous generations, that just doesn't do it for you now. Find a good company. Stay there. Loyalty gets rewarded. Your dad probably worked at the Same company for 25 years, got regular raises and retired with a pension. That's beautiful, but it's almost extinct in modern era.

[A]

Yeah, people who stay at the same company for more than two years earn 50% less over their lifetime compared to job hoppers, because companies typically only give 2 to 3% annual raises. But you can get anywhere between 15 to 30% by switching companies in today's job market.

[B]

And here's a real life example. Let's say you're making $60,000 and you stay at your company for five years, getting 3% raises after five years, you're now making $69,500. But if you switch jobs every two years, getting those 15% bumps each time, you'd be making $87,000 and that's a $17,500 annual difference.

[A]

And don't forget about these pensions. Only 18% of private sector workers actually have access to defined benefit pensions today, down from 35% in the early 1990s. Your company is not planning your retirement. They're not even planning to keep you past the next five years. We all just saw what happened with Amazon laying off 14,000 jobs last week because of AI. These companies don't care about you. It is in your best interest to job hop to the next opportunity along the way so you make more money and you're investing and saving and you're just, you're earning more money year after year, do the thing for two, three years, job hop. Two, three, four years, job hop. That's how you build wealth when it comes to earning more money in your career.

[B]

So now let's talk about the modern approach, being professionally promiscuous. The new rule is to change jobs every two to four years, especially earlier in your career. You're not being disloyal, you're just being strategic to yourself. The average tenure at a job is now just 4.1 years. So keep that in mind. And however, if you're at a growing company and you have stock options, proportional raises, and they're taking good care of you, and you like the culture, by all means, stay with that company. But just always make sure you're keeping an eye on the prize for yourself, not the bosses buying another Lamborghini and showing them off to you.

[A]

It's really funny because my fiance works at a company and I know for a fact the CEO of that company has a yacht. And it's just like, it's exactly that, right? It's like, oh yeah, go work at this company making probably below market money so the CEO can go have a yacht. It's just like, go, go job hop. Go get your bag. Go find what works for you. And that's my point, right? The, the key here is that it's different for everyone. So make sure that you're evaluating your specific situation and you're always leaving on good terms. Your network is everything. The boss that you leave today might hire you at double your salary in three years. Build those relationships, deliver value, and then leverage those relationships for more opportunities in the future. And my last piece of advice is be careful when it comes to total compensation. I know this is different for everybody, but some of us might be working at companies that give you stock options, but the company is still privately held. And like, those stock options, like, they're not traded on the stock market, so you don't really know what they're worth. So I just, I've heard horror stories of people working at startups for 2, 3, 4, 5 years and have, you know, millions of dollars worth of stock that they got. Then the company went out of business and all the stock went to zero. Because it's, it was not never on the stock market. You can never cash out on them. So just make sure whatever your situation is, you're weighing all sides of it and you completely understand what you're doing and why you may or may not want to take a job hop.

[B]

I love that because that really reminds me of Something where a lot of people, when they're looking at their compensation package, they get so excited when they're like, oh, my job. This company has a 401k. They don't even look at the terms of the 401k. They don't what the match really is. Is it 100% up to 5%, is it 100% for 2%? And then it goes down. Understand the compensation through and through so you know what you're actually getting. So that's a great point, Austin.

[A]

All right, Robert. So our final piece of outdated advice that we got from our parents growing up is this. Go to college no matter the cost. Get a degree, any degree, because it's your ticket to the middle class. In 1980, the average college degree was only $3,000 per year. You could work a summer job and pay for school. But today the Average cost is 25,000 a year for in state public universities and 44,000 a year for out of state public universities. That is over $100,000 by going to an in state public school just for a piece of paper.

[B]

Yeah, it really brings back that statement. Was me in the mid-80s when I was in college. I worked a couple jobs on the side and I had a little scholarship for baseball to be able to pay for. And it was so affordable back then. And that's when it actually made sense. Meanwhile, the College wage premium, aka how much college grads make versus high school grads, has been flat since 2000. You're paying 10 times more for the same economic advantage your parents got. And that is a terrible return on investment. We found a study that 40% of recent college grads are unemployed working jobs that don't even require a degree. And They've got got $30,000 in average student loan debt for a job they could have gotten without a college degree anyway.

[A]

Yeah, Robert, we were just talking about this last week on our Q and A episode. Skilled trades. These people are desperate for workers. Plumbers, 75,000 a year. Electricians make 60,000 to start, often hitting six figures with experience. We answered a question about this on again last Thursday's episode. One of our Q A questions came from someone who was 25 years old making a hundred fifty thousand dollars a year as a traveling electrician. Zero student loan debt. They are all out earning their college educated friends by age 25. Unbelievable stuff going on.

[B]

So the modern approach here is calculate your ROI before you enroll. What does that mean? Only go to college if the career specifically requires and the math works in your favor. If you want to be a doctor, engineer or lawyer. College might make sense because you will need degree, want to work in tech sales or start a business, maybe not because of these inflated prices for college. And with AI and everything else, you might not even need to think about going and getting that far into debt to get a college degree.

[A]

And if college does make sense, make sure you keep the cost as low as possible, right? That means starting at a community college, choosing those in state public schools, using scholarships or employer help, picking majors with real payback, and avoiding massive debt for low paying careers. We hear it all the time. You know, people that go to school, they, they get 90, 100, $120,000 of student loan debt to get a communications major or a psychology major or you know, one of these degrees that essentially, if you want to leverage it, you have to go get a master's degree, right? We're on the flip side. You've got people that get those engineering degrees, nurses. I know they're crushing it right now. I've got tons of friends that are making eighty, ninety, a hundred thousand as nurses here in Nashville, specifically at Vanderbilt. I mean there, there are degrees right now in 2026 that make Sen. AI, in my humble opinion, will not replace, I mean, maybe one day AI and you know, the humanoid's gonna do open heart surgery. But until then, we're, we're gonna need those doctors, we're gonna need those ophthalmologists, right? We're gonna need some lawyers, we're gonna need all of these very important things. And getting a college degree still makes a lot of sense for a lot of people. Just make sure that it makes sense for you. And if it does not make sense, if you're like, listen man, I have no idea what I want to study. Business management, right? Whatever that is, that's fine. Don't force yourself to like go into all this debt to go try and be someone you're not. Go find something else that's cure. Maybe you're going to go be the best chef this world's ever seen. To Robert's point, we're just talking about the trades and the electricians. I saw there was a Wall Street Journal article about how Ford is trying to hire people at 150,000 to go work on their trucks and stuff like that. It's like, it's unreal. Robert.

[B]

Yeah, that's exactly where I was going to go with this, is that I think back like Even only like 15 years ago, up till like 2 years ago, every single person was like, you have to go learn to code, go learn computer science. It's all these things are going to be needed. And everyone forgot about all these incredible blue collar trades like electricians and plumbers and drywallers and roofers. And now the story is flipped because with AI, all of that coding and all of that is going to be automated through AI. It's already happening right before our eyes. And meanwhile all of these electricians and plumbers and people like that are, are caking this, you know, six figure job and growing because now there's a huge shortage in those fields. And I think everyone should consider looking at that because there's so much growth in America right now with data center growth and everything else that these electricians and these tradesmen are going to print money for the foreseeable future. So I would definitely consider that as opposed to going and get a traditional degree. So look, your parents gave you the best advice they could with the information they had and they succeeded with these strategies. But the game has obviously completely changed. In 1975 you could support a family on one income, buy a house at 25 and retire with a pension at 65. But that's not our reality anymore. The median age of first time home buyers is now over 40 years old, which is a crazy stat for me. Most families need two incomes and nobody is getting a pension. So you gotta change with the times. And that's what this episode is all about.

[A]

Yeah. We are not playing the same game our parents played. We are playing life on expert mode and it is kicking our butts. For some of us, everything costs more, pays less and requires more strategy, more thoughtfulness as to actually executing upon those ideas. 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. Right. Let's be clear though, Robert. We could talk about the doom and gloom. We can talk about how different it is, we can talk about how much more expensive it is and all this stuff, but that's not what the show's about. Our show does not take pride in the doom and gloom. The woe is me. We are not victims. We are victors. Right. We are always victorious over here on the show and we always like to ensure that people have hope because there's a lot to be hopeful about. There are thousands of more opportunities in today's economy to make money and grow in your career with AI and the Internet and, and Shopify and Stan store and social media and TikTok Shop like, if you lock in in 2026, you can make a life changing amount of money if you know where to look. And we take pride in knowing that. This podcast covers ideas. We talk about things on our Friday episodes where we're giving you the updated, modern approach here on this episode, it's like you just have to have an understanding that things aren't what they were. You can grieve that, but you have to keep moving forward, no matter your circumstance. Right? We're all dealt a pair of cards and we got to make the best situation out of what we are dealt.

[B]

I will. As the elder statesman of this show, I am so excited every single day to be alive and well and thriving in today's world and being able to get to do this show with you every week, Austin, because we do provide all the sauce. What's happening? How can you work around it? How can you thrive in this economy? And episodes like this mean a lot to me because I am the elder statesman. I've lived all the different worlds over the last 40 years, and right now, I think, is the greatest time to be alive, to be able to build wealth as an individual. Whether you were born in a good family or born with wealth or not, there are so many incredible tools to help you get started and be able to thrive in this economy. So here's the playbook for 2026 and beyond. First, prioritize investing over home ownership. Until the math actually works. Your investment account is your real asset, not your address. Second, change jobs strategically every few years. Your biggest raises come from leaving, not staying. Loyalty is to your career, not your employer. Unless, of course, you have a wonderful job with a wonderful company. But all others, you should definitely be looking out for yourself. And third, treat education as an investment with measurable roi. If the numbers don't work, find another path. Skills matter more than degrees in almost every situation.

[A]

Robert, what a fun episode. I. I really enjoy kind of, this is fun, right? You got to go through a lot of that stuff. I mean, theoretically Speaking, you are 30 years older than me, so you are the age of a hypothetical father. So it's kind of fun to see how different it is. You know, your upbringing, I'm sure your ability to get into real estate, buy a home, build a career, do investing. And how different that is from what I'm going through right now and others that are near my age. I, I turned 30 here later in 2026. So people that are listening right now in their late 20s, 30s, and 40s, right? It's a little Bit different for us, but at the end of the day, it's exactly what I said before.

[B]

Hope.

[A]

There's so much to have hope about. There's so much to be excited about. Opportunities are abundant. New Year, new me. I know we're up in the next month. So, like, if you didn't do your New Year's resolutions, yeah, new month, let's rock and roll, let's get to it. But there's a lot to be excited about, Robert, and we're going to keep this excitement all of 2026 and lay out all the blueprint you guys need to print money in the stock market, in your own personal finances, and have your net worth explode over the next five, 10, 15, 20 years. Because again, Robert, the big thing people need to understand, it's all about getting rich.

[B]

Yeah. One of the biggest perspectives that's kind of funny, and you brought it up earlier, is having a map in the 80s. Think about it from this perspective, every one of you that is, let's call it 45 and under. You never had to go on a road trip where you didn't have gps. You could just plug it in the phone and it tells you where to go. And you got a nice voice guiding you. Back when I was in high school and college, you had to have somebody with you, otherwise you had to have a map up, holding it up, trying to find the road to go where you want to go. So that's just one example of how wonderful the world is, is, and how much less stressful it is because of tools and modern technology. So just make sure you get ahead of it. You use the Rich Habits Network and podcast as a way to understand what's next in all of these technologies with AI and everything else, so you can thrive and build financial freedom.

[A]

I want to really encourage people before we jump to our Q and A section. If your life is not exactly what you want it to be, spend your weekends building the life that you want to live. We talk about this all the time. Robert says this all the time. Being able to wake up Monday through Friday and love your life is really, really important. The mundane Tuesday is what I like to call it, ensuring that those Tuesdays are always the best days ever because you've spent the weekends building that life. If it's a routine, if it's a new career, if it's a side hustle that turns into a business, if it's whatever it wants to be for you, like build your dream life. And sometimes building your dream life might feel embarrassing because your dream Life might be be, you know, starting a candle making business. And you don't want your friends from church to be laughing at you about it because you're going to go start this. You're going to start a candle business. Okay. Yeah. Good job, Austin. Go have fun with that. Right? Like, just go build your dream life. Because the people that you admire that have the life that you want, they're never going to judge you or laugh at you for trying to do anything to better yourself. The only people that are judging you and laughing at you are people that are envious of your own situation. So go change your life. 2026 is just getting started here. Our lives are not what they used to be when our parents were around, but I'd argue that's better. My dad didn't have the opportunity to go do fun podcast stuff on the Internet. I do, and I'm having a blast.

[B]

Yeah, it reminds me, and I'm sure you went through it just as much as me a couple years back is how's that little TikTok thing going? And now it's like the last laugh, you know, just to be able to build something that's really meaningful and have such a huge podcast that hundreds of thousands of people watch and enjoy and learn from. So I love it. I love the intern. Everything that we're doing, but also sharing with our audience.

[A]

All right, Robert, so before we jump to our first question, got to give a shout out to public.com, the investing platform for those who take it seriously. Because on public you can build a multi asset portfolio of stocks, bonds, options, cryptocurrency and now generated assets which allow you to turn any idea into an investable index using artificial intelligence.

[B]

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[A]

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[B]

Paid for by Public Investing. Full disclosure in the podcast description.

[A]

So our first question comes From Brandy D on Instagram. If you have a question for a show, please DM us on Instagram at Rich Habits Podcast or email us at Rich Habits podcast gmail.com. it's actually funny, Robert. This is actually pretty timeless. Brandy says how early do you put your startup online business into an llc?

[B]

Yeah, that's a tricky one because on one side I think you should get the idea up and running, get your social handles, get your website done and all of that stuff and then do the llc. But I generally do the LLC first because, you know, I kind of have a little bit of arrogance and insureness in my career that it's going to work work. But if you're not sure and it's a side hustle, you don't know how much money you're going to make and it's a smaller idea. Maybe in the beginning I think you could get up and running and test it and do all that. And as soon as you figure it out and realize, whoa, this is really going to work, then I would definitely draw the line in the sand. Get the llc, get the operating agreement, separate it all out, get the business bank account, make sure you do all the things right because once you're making real money money, you want the tax advantages of these LLCs and you want the write offs, but you also want the liability protection of having an LLC for your business.

[A]

I really, really like that breakdown, Robert. So if it were me, and yeah, I kind of have that arrogance too where it's like, oh, I'm doing this, I'll just start the LLC now because that's no, it's going to work. So know exactly what to do. But back in the day he was like, actually what I did. So I started posting videos on TikTok in March of 2020 and in April of 2020 I started Monetiz business around those videos. And so I started making money in April and May, June, July, and not until August of 2020 did I finally create an LLC. I want to say this was after I made maybe like 3, 4, $5,000. And then I was like, oh, this is real. Okay, I'm gonna go make an llc and like actually do this now. You know, again, I was making a couple hundred bucks here, a couple hundred bucks there. Like, yeah, that's fun. But that's of course not the goal. The goal is to make a lot of money with an online business. But until I saw the clear path to making thousands of dollars, I about making the llc. But once I had that path and I Saw where I was going and how I could put fuel on this fire with more time and energy and focus and really begin to blow up a business. Then I was like, oh yeah, I need to get an llc. So in my opinion, if I were you, I would maybe do the same thing. Which was like, hey, I have to start. I just made a account on Stan store, so S T A n dot S T O R E and now I'm selling consultations on makeup design for people that want to redo their makeup. I'll sell a consultation on Stan for $42. A Sess session and for 30 minutes we talk about your makeup and all that stuff. And if you're doing 40, 80, $120 a month on those consultations, like, yeah, I guess you can get an llc, but I feel like you might pay more for the, you know, annual report that the bookkeeping, the account, all the stuff that goes with having an llc. But if you're making hundreds and now thousands of dollars a month with your business and the cost of maintaining an LLC is dramatically lower than the amount of profit you're making, it definitely makes sense to have an llc. And to all the stuff that Robert just said about like the write offs and you know, home office expense, anything that you are spending money on to run your business is a write off against your taxable income for that business.

[B]

And one more thing I want to add to this, and we can go to the next question that I think is a nice little hack for people is when you're naming your llc, it doesn't need to be the name of the product. Why is this important? It gives you a little bit of anonymity, but it also gives you flexibility, ability. So let's say you have 1, 2, 3, 4, Main Street LLC. But your app idea is about pet something, pet training, let's say. Then you can have it be DBA BD's pet training brandy D. And then that way if that doesn't work, you don't have to abandon the LLC and you can keep that LLC and pivot the use to another new business if that one were to fail. So just keep that in mind. You don't have to name the LLC after the business idea or concept. And that's a way to save you time, time and money down the road if you were to fail.

[A]

I really, really like that. And don't forget, once you get the llc, go apply for your ein, your employer identification number and then go use that to open up a business bank account. Because if you're making enough money to want to get an llc. You're going to need that business bank account and you're going to make sure you're tracking all the money coming in, going out. It's going to be all over there. Always keep those things separate. It's going to make tax time much, much easier. So our next question comes from Caleb B. On Instagram. Caleb says, I'm starting to build a nest egg for our next home upgrade. We live in a small town currently in a very small home and we'll be looking to buy in the next four to five years. We currently have a hundred thousand dollars of equity in our home. We make $250,000 combined between both of us and have started paying off my wife's pharmacy school student loans of $2,000 a month. We're looking to invest $2,500 a month or more in the coming months with bonuses toward saving for this nest egg. How would you invest this nest egg to make sure it stays safe and secure? But it also grows over this four to five year period of time. I'm thinking about 70% of it should be in cash and 30% of it should be in the markets with 20% of the 30% in dividends. Would love to get your perspective, Robert. I know you're just squirming looking at some of this, so I'll let you chime in.

[B]

I am squirming because I think think you're on the right track. But you need to flip flop this because the key here is, and this is something Austin and I cover all the time is if you're building this nest egg to buy a house in a year, even two years, I'd say this could work. But if it's four or five years down the road, I think you're leaving way too much money on the table by having this strategy. I would flip flop it. I would have 50 to 60% in VOO, then I would probably have have 10% in dividend, 10% in bond, 10% in treasuries like some T bills. And that's the the way I would do it more so because right now I just feel like you're too much in cash and too risk off for a four or five year span. You'd leave way too much money on the table, especially with investing $2,500 a month.

[A]

And then though, let's talk about when it makes sense to, you know, go back toward cash. So for example, I plan on buying slash build. I'm building a home this year and that's going to take place in like October. We're filming late January. So for me, all cash that's not invested. My down payment, it's over here. Like I don't want something stock market related to be rocking and rolling. Then boom, Trump tweets something crazy and my down payment is now worth 30% less. Right? I don't want to do that. I don't want those market dynamics. So for me, I always think if you're within 12 to 18 months of purchase time, of financing time, move away from the markets and put it in a high yield savings account, which is where mine is earning like 3 and a half or 4%, whatever it might be. So in your situation, Caleb, I'd do what Robert said I would do the stock market stuff for that first, call it three, three and a half years or so. And then after three and a half years, flip flop, have maybe a little bit of money in the markets if you want. But make sure the majority 70, 80, 90% is sitting in those treasury bills that are earning 3 or 3 and a half or 4% or high yield savings or something of that nature. So our final question comes from H on Instagram. H says hello, I'm married, I'm 69 years old and I have two and a half million dollars in a Charles Schw that's 100% invested into stocks over the lifetime of this account. The returns have been 24% per year on average. And I'm very happy with it. That's awesome. That's pretty good. We own our house outright. It's valued at $900,000. We own a business debt free that's valued at $2 million. We have $180,000 in cash in various bank deposits earning 2 or 3%. I was thinking to start taking Social Security of $4,100 a month on my 70th day and take some monthly dividends which might also be about 2,300amonth. I can also take up to $10,000 a month out of the business and it won't affect things that much. The problem we're having is our lifestyle. We spend $14,000 a month on high value travel and dining out. What should we look at as far as our market risk and taxes going forward? A pullback in lifestyle is hard. Giving our continued lifestyle. We have no credit card debt. This is all from working hard for the last 55 years. If I need to fill the gap and get that $14,000, how do I obtain it? That's A good question, Robert. So let's talk through this one together. They need $14,000 after taxes. $14,000 a month right now is $168,000 a year. So you're looking at about 200ish thousand dollars of pre tax income that they need to come up with. They mentioned already already that they can get $4,100 from their Social Security, which like why have you not done that already? That's a great idea. I firmly believe that you should take Social Security as soon as possible because you can go put that money to work better than the government can do it for you. And not to be morbid, you have no idea when you're going to die. What happens if you died at 68? And this 4,100amonth that you could be taking, like sucks, right? So like 4100. Love that. Keep going. You mentioned a 2300 of the dividends. Now we're at 6400amonth. And then you mentioned up to 10,000amonth out of the business. But something we're not talking about or something you haven't mentioned here, H is the two and a half million dollars in your Charles Schwab account. Why don't you just put the 4% rule to work, Take out a hundred thousand dollars a year from that account. So you know, that's exactly, let's call it 8,300 bucks. Add the 6,400 to it, which we just talked about. 2,300 from the dividends, 4,100 from the Social Security. Now you are open over $14,700 a month to fund your lifestyle. I think that's what you end up doing. You keep your nest egg growing for you in the Schwab account. You're taking your well deserved Social Security. You're taking some dividends, which I think is fine too. And if you need to have a big expense, you have the flexibility to tap into that business.

[B]

I think that's a great breakdown. And the number one thing I want to click back on here h is you say the problem is our lifestyle spends well over 14,000. It's not a problem. Problem. You've crushed it. You've set yourself up well. You have money everywhere. You still have the business money that you could take out 5 or 10,000amonth from and it sounds like wouldn't affect the business at all. You are crushing it. Live your Life. Consider the 4% rule to get you above that $14,000 a month you need and call it a day. You have crushed it and you should be high five in the monitor, in your bank accounts and really excited to keep rocking and rolling, rolling into your retirement because you've set yourself up well. And one more thing I want to add just a couple more points is this. You say that you're all in this 100% mix of stocks that have done well over the years, but at 69 years old, I think it might be time to dial that back a little bit, get a little bit your foot off the gas, so to speak. And I would maybe look at a portfolio that's 60% stocks, 40% bonds. So you've got a little more protection against volatility. I think that would be a good thing to integrate here as well. But then also consider this because you mentioned taxes. If you worked with this 4% rule that Austin broke down, you have to look at it from that portfolio income. You're only paying long term capital gains as well on the 4% rule of the money you'd be taking out to get you above that 14,000amonth. So those are two more considerations tactically that I think would help you really thrive in retirement and keep you on the right track.

[A]

Yeah. Make sure you learn all about qualified dividends. Make sure you understand long term capital gains. Because when I see Social Security at 4,100amonth, Social Security is taxed at regular income. At least that's how I understand it. I think that's what my dad paid. Right. You pay taxes on a tax that. It's crazy. But long story short, just make sure that you're optimizing for taxes. You're working with a professional, a CPA or financial advisor. That's going to help move you along here and show you. Okay, here's how we can reimagine the portfolio so it's a little less aggressive. Here's how we can be thinking about the 4% rule for lower taxes. Here's what we can do for some qualified dividends, things of that nature. So be sure to think about all that stuff here. H as you enjoy your retirement. 14,000amonth. Heck, double it to 28 and go really enjoy yourself in 2026. You can afford it. You're rich. You're filthy rich.

[B]

I love it. What a great episode. It was so fun. Kind of like leaning in our age gap here of 30 years of what worked back when I was young versus what works now and really breaking it down. That was a blast.

[A]

Absolutely. Everybody, thank you so much for joining us on this week's episode of the Rich Habits podcast. And don't forget, before you go, we publish an episode in January, sharing our 2026 money calendar. The month of January is gone, right? We are now in February, which means that you need to go make sure that you actually did that January thing. Those January things were to track your net worth and to make your honest budget. This is your reminder. If you've not yet tracked your net worth for January, go do it. If you've not yet created an honest budget, click the link in the show, not below and create one and go start budgeting your money better in 2026. We're one month in. You got to lock in. We gave you the playbook. It's up to you to actually go do it.

[B]

Thank you everyone, and we'll see you on Thursday.

[A]

Sam.