Rich Habits Podcast: Q&A Edition Summary

Episode: Q&A: YieldMax ETFs, When To Invest For Your Children, & A Special Guest!
Release Date: July 31, 2025
Hosts: Austin Hankwitz and Robert Croak
Guest: Zade Moni, Host of The Rundown Podcast

1. Episode Introduction and Guest Welcome

The episode kicks off with the hosts introducing the Q&A format, inviting listeners to submit questions via Instagram, email, or the Rich Habits Network. They welcome Zade Moni, host of the daily podcast The Rundown, highlighting his efficient daily listening habit. [00:45]

Christian:
"We are joined by Zade Moni, the host of Publix podcast called the Rundown. It's an awesome daily podcast that everyone should be listening to." [00:45]

2. YieldMax ETFs and Portfolio Allocation

Listener Question:
Jeff M. shares his investment journey, detailing his retirement accounts, emergency fund, and experimentation with various ETFs, specifically YieldMax ETFs like Ulty YMag and Big Y. He seeks advice on portfolio allocation towards these high-yield ETFs and the potential integration of put option strategies for hedging.

Robert's Insight:
Robert emphasizes understanding key terms like Net Asset Value (NAV) and warns against ETFs that exhibit significant NAV erosion. He cites TSLY, a YieldMax ETF, which has experienced an 81% decline since November 2020. Robert advises favoring NEOS funds for their covered call strategies that minimize NAV erosion, maintain exposure to underlying indices, and offer tax efficiency. [06:00-07:18]

Notable Quote:
"These yield max ETFs that are paying 50, 75, 100% yield per year...depends on the net asset value, AKA the money you invested to begin with." — Robert [06:10]

Emil's Input:
Emil critiques YieldMax ETFs for their high expense ratios (~1%) and inconsistent distributions due to NAV erosion and volatility. He advises against them, recommending NEOS ETFs instead. [07:18-08:13]

Robert's Conclusion:
Robert suggests keeping high-yield ETFs as a small portion of the portfolio and exploring other yield-generating options like dividend ETFs. He stresses caution due to high fees and inconsistent yields. [08:13-09:04]

3. Investing Strategies for Emil J.

Listener Question:
Emil J., a 35-year-old, inquires about reallocating his $9,000 Vanguard money market account into an index fund and the feasibility of opening a Roth IRA with his remaining $500 monthly savings, fearing reduced flexibility.

Emil's Advice:
Emil recommends prioritizing the Roth IRA for its tax-free growth benefits, suggesting a split investment (e.g., $250 into Roth IRA and $250 into a brokerage account) to maintain some liquidity. He underscores the importance of starting Roth contributions early to maximize compound growth. [10:55-11:51]

Robert's Perspective:
Robert advises against touching the emergency fund and echoes the importance of maximizing the Roth IRA. He emphasizes retaining a robust emergency fund to avoid financial setbacks during unforeseen events. [12:05-12:49]

Christian's Strategy:
Christian suggests bolstering the emergency fund to three to six months of expenses before allocating additional funds. He explains the role of the emergency fund as financial insurance, preventing the need to liquidate investments during downturns. [12:49-14:33]

Robert's Addition:
Robert highlights that Roth IRA contributions can be withdrawn penalty-free, offering additional flexibility. [14:33-14:51]

Emil's Further Insight:
Emil emphasizes the necessity of maintaining multiple retirement accounts (Roth IRA and 401k) to ensure long-term financial security, advising against sacrificing retirement savings for short-term goals. [14:51-15:44]

4. Saving for an Engagement Ring

Listener Question:
Jacob B. seeks advice on whether to keep his savings in the stock market or move them to a high-yield savings account when saving for an engagement ring in two years.

Robert's Opinion:
Robert controversially suggests keeping the funds invested in the stock market to potentially benefit from market gains, allowing for a more substantial ring purchase if markets perform well. [16:17-16:40]

Christian's Approach:
Christian provides a balanced view, recommending dollar-cost averaging out of the stock market into a high-yield savings account approximately 18 months before the purchase to mitigate the risk of market downturns affecting the savings. [16:40-17:46]

Emil's Bold Recommendation:
Emil advocates for keeping the funds invested, highlighting potential higher returns compared to savings accounts. He cautions about possible personal setbacks but emphasizes the long-term growth potential. [17:46-19:21]

Christian's Financial Breakdown:
Christian offers a detailed comparison, illustrating potential growth scenarios in both savings and investment accounts over two years. He emphasizes understanding the impact of market performance on the final amount available for the engagement ring. [19:21-20:46]

Robert's Final Thoughts:
Robert acknowledges the context provided by Christian and supports the need for informed decision-making based on individual financial goals and risk tolerance. [20:46-20:48]

5. Retirement Portfolio Allocation

Listener Question:
Dave N. plans to retire in his early 60s with a projected $4 million 401k. He questions whether a large retirement portfolio can sustain a 100% stock allocation, arguing that a substantial balance can weather market contractions better than smaller portfolios.

Emil's Recommendation:
Emil advises against a 100% stock portfolio, even with $4 million, due to potential significant drawdowns. He suggests a diversified approach with about 70% equities and 30% diversified assets like bonds to balance growth and risk. [22:12-23:26]

Robert's Agreement:
Robert concurs, emphasizing the psychological toll of significant portfolio declines. He recommends diversification to include lower-risk investments, providing peace of mind despite the potential for market recovery. [23:26-24:13]

Christian's Comprehensive Strategy:
Christian aligns with Robert's view, advocating for a core-satellite portfolio structure (65-85% in index funds/ETFs and 15-35% diversified). He elaborates on how even with a $4 million portfolio, diversified investments safeguard against market volatility while adhering to the 4% rule. [24:13-26:59]

Emil's Final Point:
Emil promotes bond accounts with competitive yields as part of a diversified strategy but cautions that yields are not locked until purchase. [26:59-27:19]

6. Financial Planning for Newly Married and New Parents

Listener Question:
Christina L., newly married with a baby, seeks advice on combining financial accounts, setting up financial plans for children (529 plans vs. custodial IRAs), and the financial implications of potentially taking a career break to raise more children.

Robert's Guidance:
Robert advises maintaining both separate and joint accounts for financial flexibility and accountability. He recommends 529 plans for children's education and shares personal experiences managing finances with family support. [28:38-29:47]

Emil's Analysis:
Emil stresses the importance of ensuring sufficient retirement savings before expanding the family. He warns that additional children may strain the budget, reducing the ability to save adequately for retirement. [29:47-31:21]

Christian's Holistic View:
Christian echoes the importance of prioritizing retirement and suggests incremental increases to the emergency fund. He recommends investing in 529 plans early to leverage compound growth and ensures a balanced approach to financial planning for children. [31:21-34:13]

Robert's Emphasis:
Robert underscores securing retirement funds before allocating significant resources to children's financial futures, preventing future financial dependence. [34:13-34:41]

Christian's Final Recommendations:
Christian advocates for combining financial accounts to enhance transparency and mutual accountability. He recommends funding 529 plans early and maintains that parents should prioritize their financial stability to support their children's future effectively. [34:41-46:14]

7. Importance of Mentorship in Building Wealth

Listener Question:
Jared H. reflects on the evolving dynamics between hosts Austin (a multi-millionaire entrepreneur) and Robert (a seasoned decamillionaire). He inquires about the value of mentorship in wealth building and whether having a younger partner motivates Robert.

Austin's Response:
Austin credits Robert and other mentors for his success, highlighting the importance of having experienced individuals to ask questions and receive practical advice. He aspires for the podcast to serve as a mentor-mentee resource for listeners lacking such networks. [39:24-41:00]

Emil's Perspective:
Emil emphasizes mentorship's role in accelerating career growth by avoiding common mistakes and leveraging established knowledge. He differentiates between valuable mentorship and less effective "guru" coaching, advocating for quality, experience-based guidance. [41:00-45:06]

Christian's Experience:
Christian shares his positive experiences mentoring others, illustrating how collaborative efforts can lead to mutual success. He underscores the significance of surrounding oneself with motivated, knowledgeable individuals to foster personal and professional growth. [41:20-43:31]

Emil's Final Thoughts:
Emil highlights the transformative impact of mentorship and coaching in the digital age, where accessible resources and communities like the Rich Habits Network facilitate rapid learning and application of financial strategies. [43:31-45:06]

Robert's Contribution:
Robert echoes the value of knowledgeable mentors, noting that experienced individuals provide crucial support and belief systems that empower mentees to unlock their potential. He advocates for purposeful mentorship interactions to maximize mutual benefits. [45:06-46:14]

8. Episode Conclusion and Promotions

The episode wraps up with the hosts expressing gratitude to Zade Moni for his participation, promoting upcoming Friday episodes that cover topical financial news, and encouraging listeners to leave five-star reviews on Spotify to help grow the podcast's reach. They reiterate their commitment to supporting listeners' financial and business journeys through valuable content and community engagement.

Christian's Closing Remarks:
"We are here to provide that. Please, please, please... leave us a five-star review on Spotify." [46:14-46:50]

Robert and Emil's Final Words:
They encourage continuous engagement with the podcast and underline the importance of financial education and disciplined investing.

Notable Quotes:

• Robert on NAV Erosion:
  "These yield max ETFs that are paying 50, 75, 100% yield per year...but that distribution is coming from... the money you invested to begin with." [06:10]

• Emil on Expense Ratios:
  "They charge right around 1% for their expense ratios, which I think is egregious." [07:18]

• Robert on Roth IRA:
  "Roth IRA contributions can be withdrawn penalty-free." [14:33]

• Emil on Mentorship:
  "You want the speed. That's the key for me." [45:06]

This episode of the Rich Habits Podcast delves deep into strategic investment choices, emphasizing the importance of understanding financial instruments, maintaining a diversified portfolio, prioritizing retirement savings, and leveraging mentorship for financial growth. Hosts Austin Hankwitz and Robert Croak, along with guest Zade Moni, provide actionable insights and thoughtful advice to empower listeners in taking control of their financial futures.