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Join Mindy Jensen and Scott Trench (from BiggerPocketsMoney.com) weekly for the BiggerPockets Money Podcast. Each week, financial experts Mindy and Scott interview unique and powerful thought leaders about how to earn more, keep more, spend smarter, and reach financial independence.
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Most college students know next to nothing about money. Even worse, many of them sign on to expensive student loans with almost no plan on how they’re going to pay it back. While this is the average, some people, like Nathan Kennedy, host of The New Money Podcast, did things differently.
Although he overspent a bit going out in college, Nathan graduated with a degree and $40,000 in cash, a MASSIVE amount for any college student. Through applying for grants, working at on-campus jobs, and collecting tip money as a bartender, Nathan was able to graduate in a solid position, allowing him to invest heavily in the stock market during the 2020 crash.
Now, Nathan teaches others how they can strengthen their financial position through hard work, planning, and constant content consumption. If you have children who are in high school, college, or are newly graduated, send them this episode so they can have a leg up on future finances!
In This Episode We Cover
The importance of tracking your expenses and budgeting properly
Vision boards, daily logs, and other ways to plan for your success
Pursuing grants and scholarships WHILE school is in session
Becoming a constant content consumer
Money mistakes that many college students make (and how to avoid them)
Making time for health, fitness, and no-phone relaxation
And So Much More!
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“Beware of little expenses; a small leak will sink a great ship.” This is the topic of today’s episode, where we interview Jenny for a Finance Friday review. Jenny is finishing up her fourth degree and has been working throughout grad school to help her family. Her husband brings in a sizable income, but he wants to retire in 2030 and spend more time with their (future) kids.
Jenny has great control over her fixed expenses, but as for her variable expenses...not so much. Her family is consistently teetering between $1,000 a month and $2,400 a month in variable expenses, many of which can be resolved with some simple shopping tweaks (like leaving your credit card at home when you go to the grocery store). Luckily, they’ve invested a fair amount of their take-home pay, have a stellar 401(k) match, and are about to have dual incomes once Jenny is out of school.
If you’re having trouble keeping a hold on your variable expenses, such as random Amazon shopping, tune in for this episode for advice on exactly what to do.
In This Episode We Cover
How to plan for retirement with two full-time incomes
Paying off your home vs. investing in assets like index funds and real estate
Taking advantage of 401(k) matches and maxing out retirement accounts
Leveraging a future job to pay off student loans
How to curtail your variable expenses and reduce “random spending”
Why someone with “mortgage anxiety” should be wary of real estate investing
And So Much More!
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What do you think of when you think about retirement? Are you on a tropical island drinking fruity cocktails out of a coconut? If you dream about that sort of retirement, Steve Adcock may have some revealing words for you. Retirement isn’t just about doing nothing all day, it’s about exploring your passions, and sometimes working more than you did before, to accomplish things that truly matter to you.
Steve decided to leave his high-stress IT job after 11 years of work. It was eating away at him every day, and it got to the point where just going into work became a grueling weight on his shoulders. He knew from a few years before potential retirement that he had a choice: lavishly live his life now or live frugally and have financial freedom forever. He chose the latter and doesn't regret it for one second.
Now, Steve and his rocket scientist wife spend their time taking care of their completely self-reliant housing compound in Arizona. He has a lot more to accomplish, but for now, he’s enjoying his off-grid lifestyle, complete with solar panels, his own water well, and a brand new septic tank.
In This Episode We Cover
Why it’s important to have a financial plan (even if you won’t retire early)
Working (lightly) in retirement so you can enjoy more freedom
Tracking your spending meticulously so you know where every cent goes
Taking care of your health and wealth when given free time
Spending in post-retirement, and how it differs from regular spending
Why early retirement WON’T make you happy
And So Much More!
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Sometimes having a lot of cash can be dangerous. Would you rather be sitting on months (or even years) worth of emergency reserves or have your money be challenging inflation by sitting in investments like index funds or real estate? This is the question that many people have, and also one that today’s guest, Phil, is having as well.
Phil and his wife live in a relatively low cost area and bring in a very solid income. They’ve been maxing out HSAs, 401(k)s, and other accounts all while having a significant amount of cash on the sidelines, just waiting for the right investment. While Phil wants to go into an unconventional type of real estate investing, both Scott and Mindy believe he should focus on the long-term goals he has set for himself and find asset classes that fit within his strategy.
In This Episode We Cover
How much is too much of an emergency fund?
Selling tradelines and the risks/rewards that come with it
Why investing in traditional-layout houses presents you with multiple exit strategies
Solo 401(k)s, IRAs, HSAs, and other retirement accounts
Creating a reasonable timeline to act on an investment, instead of losing money to inflation
Understanding what a good rent-to-price ratio is for your area
And So Much More!
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A lot of people in the financial independence community successfully get out of debt, but not many of them get out of debt and then start a monthly six-figure side business. One person who has done that is Deacon Hayes. Deacon was raised by a single mother on welfare who taught Deacon that debt was a way of life. When Deacon married his wife, they both collectively realized that the only way for them to live the life they wanted to, was to get out of debt.
Deacon did whatever he could to pay off his debt. He delivered pizzas and resold furniture, all while working full time. Once he was out of debt, he decided his passion was in teaching others how to get rid of their debt, so he became a financial planner and started his website, Well Kept Wallet. His story was so well received that he was brought on to record with Fox and tell their audience about his debt-free journey.
Deacon left the financial planning world after realizing he didn’t want to just help the rich, but the average person who still struggled with debt. To subsidize his business, he started a website building business, but later automated this and kept the lion's share of the profit while doing very little work. He started an SEO (search engine optimization) business and did the exact same thing. Then as Well Kept Wallet was bringing in massive revenue numbers, he did the same, hiring another worker to fill his role so he could focus on what he loves.
In This Episode We Cover
Getting rid of debt as fast as you can so you can start saving and investing
Foreclosures, land leases, and other real estate predicaments
Making sure you keep a large emergency fund (especially if you’re an entrepreneur)
How to hit “hockey stick” level growth and what to do when you want to step away
Firing yourself from your business and learning to outsource
How to establish self-worth after you “retire”
And So Much More!
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Making too much money is a good problem to have, and it’s one that many people in the Bay Area experience. Today we talk to Laurin, a mother of two, making $281,000 a year when combining her salary with her husband’s. They’re doing everything right: paying off the mortgage, contributing to their 401(k)s, and saving up for an emergency reserve.
With all these investments and income, Laurin is wondering whether or not her investing strategy is optimized. Her mortgage spans 15 years, so she’s dedicating a large amount every month to pay off her house before she retires. While some people prefer the financial security of not having a mortgage, others (like Scott), prefer having a mortgage for longer while investing in other assets.
With the goal of enjoying her life more, Scott and Mindy bring up a handful of options that can help Laurin achieve a massive net worth by the time she is ready to retire. She could work less and contract more, she could refinance and invest for cash flow, she could look into real estate investing, all while she’s setting up a massive nest egg for herself upon retirement!
In This Episode We Cover
Always taking the 401(k) match your company offers (when available)
Using “event-based” planning when you’re closer to retirement age
Pre-tax retirement accounts vs. post-tax retirement accounts
Saving for children’s college with a 529 plan
The two main real estate investing traps to avoid when investing out of state
And So Much More!
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Dee Olateru doesn’t have the traditional FI story, but it didn’t take her long to catch onto the concepts that now allow her to live a life exactly how she sees fit. Dee immigrated to the United States from Nigeria when she was sixteen. Without the ability to get student loans, Dee had to work throughout school, apply for every scholarship available, and borrow money from friends and family to pay for her undergrad degree.
While she made it out of college without student debt, she still had some credit card debt that needed taking care of. She amassed $10,000+ in credit card debt to help her pay for necessities like groceries throughout her years in college. But now she had a business degree, so clearly, she went on to get a full-time job in her field, right? Actually, she didn’t. Dee graduated during the great recession and had to take a $10/hour job at a local factory.
Dee says that many people don’t believe her about the factory job because of the high-level position she’s in now, but it taught her many valuable lessons. As Dee made more and more money, she started looking into finance blogs to see where she should be saving and investing. For the better part of a decade, Dee has been maxing out her Roth IRA, 401(k), and investing in individual accounts, all while she travels around the world!
In This Episode We Cover
Having a “debt payoff plan” so you know exactly how and when you can get rid of debt
Joining online communities as a “close circle” for financial debates and idea-sharing
Maxing out your Roth, 401(k), and other retirement accounts as early as possible
Never falling into FOMO and only investing in assets you understand
Seeing your financial journey as a way to “start with what you have”, not what you wish you had
And So Much More!
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Investments galore! This week, we talk to Jeana and Scott, a couple with a hefty amount of investments under their belt. We know what you’re thinking, “what type of stocks and real estate are they investing in?” This is where you might be surprised. Jeana and Scott are investing in three gyms, a gas and oil investment, a documentary, a 24-unit apartment building, a 52-unit apartment building, a senior care business, and...a $20,000 dog! Seriously! This is one of the most diversified couples we have ever had on the show!
While it’s great to have investments spread out over multiple different asset classes, Scott and Mindy want to help the couple come up with a more systematized and formulaic approach to wealth building. Since they both have well-paying jobs, once they set up a “set it and forget it” type investment strategy, they won’t be too far away from reaching FI.
If you’ve ever had an interest in running a memory care facility, dog breeding, or investment clubs, this will be a great episode to listen in on!
In This Episode We Cover
Diversifying your investments into multiple different asset classes
Knowing which investments are likely to make a return and planning for those that won't
Setting up a system for wealth creation so you can develop an early retirement plan
Investing in multifamily real estate like apartment buildings and senior living homes
Using government benefits to maximize wealth as quickly as possible
Investing in an Airbnb property and which markets make the most sense for it
And So Much More!
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Darius Smith always knew how to make money, but wasn’t very good at saving it. Growing up, he had jobs ranging from delivering phone books, to running paper routes, to even putting up eviction notices on homes. He opened his first bank account when he was around nine years old! So how did Darius end up with almost $170,000 in debt? An even better question may be, how did Darius pay off all that debt in only a few years?
Darius spent time at multiple different colleges, racking up $40,000 in student debt, then buying a Mustang, paying for a wedding, putting some charges on credit cards, and finally combining his wife’s debt with his. They started to use the “debt snowball” method, but after having to take out business loans, the debt grew even more.
This is when Darius decided that he and his wife needed a plan to conquer their finances. They moved into a friend’s extra room for cheaper rent, stopped going out as much, began working more than one job, and siphoned all the money they could into savings and debt payoff. As of July 2021, they are debt-free!
In This Episode We Cover
How to prepare to take on student debt (when needed)
Avoiding lifestyle creep and finding ways to lower your expenses
The “reverse house hack” and renting a room for far cheaper living expenses
Mortgage forbearance and student loan forbearance in 2021
“Isolating yourself” from friends or influences that will cause you to spend more
Having a money date with your partner and going over finances regularly
And So Much More!
Links from the Show
BiggerPockets Money Facebook Group
Finance Review Guest Onboarding
BiggerPockets Money Podcast 121 with Seth Jones
BiggerPockets Money Podcast 73 with Ramit Sethi
BiggerPockets Money Podcast 127 with Ramit Sethi
Check the full show notes here: https://www.biggerpockets.com/moneyshow221
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Entrepreneurs work long, stressful hours, and as a result, they get paid the big bucks. This is the position that Stephanie, a freelance Salesforce consultant is in. She makes a respectable income, bringing in $14,000 after tax! But, that income comes at a cost.
While Stephanie is currently contracting out work to a few part-time employees, she spends at least 50 hours per week on the business. She’d like to get to a point where she can step back and work 20 (or so) hours per week and have a systematized and growing business. She’s financially in a great place, with more than three years of expenses saved in cash, so she can take more risks with her business.
If you’re growing your own business, rental portfolio, or side-income stream, you may be in Stephanie's position in the future. Stick around to hear exactly what Scott (an active CEO) would do if he was in her shoes.
In This Episode We Cover
Time freedom or financial freedom, which is more important?
Taking your hands off the reins and letting your business grow
Subcontracting out work so you can focus on leading a business
Firing clients who aren’t the best fit for your business
Creating systems and procedures so your business can become scalable and saleable
And So Much More!
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