In this week's episode, Brad and Jonathan get introspective and examine the choices that everybody has laid out for them in their lifetimes. Together, they ponder why so many choose only the cookie-cutter options in life, and how taking the path less traveled can lead to happiness you never even knew was possible.

Resources Mentioned In Today's Conversation

• Maslow's Hierarchy of Needs
• Into The Wind with Brandon Pearce
• Subscribe to our Newsletter!
• ChooseFI Local Groups

Want to start your own journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!

In this week's two-part episode, Brad and Jonathan provide personal examples and insight on relatively safe ways to experiment with your FI investment plan! Later in the show, Sean Mullaney joins the guys to discuss revocable living trusts and how they can fit in with the, "hard to think about," side of future tax planning!

Resources Mentioned In Today's Conversation

• Tax Basis for Beginners
• Transferring A Primary Residence To Children
• What Does Inflation Mean for Investors? With Big ERN | EP 331
• Are You as Diversified as You Think You Are? With Frank Vasquez | EP 313
• Risk Parity Radio
• Transform Your Tax Return Into a Springboard for Financial Planning | EP 332

Want to start your own journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!

In this week's episode, Brad and Jonathan are joined by Jillian Johnsrud, the host of the Everyday Courage podcast and fellow FI guru. Jillian shares with the guys the concept behind a mini-retirement, or in other words taking an extended period of time off outside of the so called "golden years." Together, the trio discussed the benefits of mini-retirements, strategies for optimizing your time while mini-retired, and how to properly prepare for a mini-retirement!

Resources Mentioned In Today's Conversation

• The Four Hour Work Week by Tim Ferriss
• Episode 147 | Negotiating Your Salary with Tori Dunlap
• Adventures to FI Retreat
• 6 Steps To Taking A Mini-Retirement
• Jillians Free 10-Day Life Planning Course

Want to start your own journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!

In this week's episode, Brad and Jonathan are joined by none other than the "FI Tax Guy" himself, Sean Mullaney. Together, they highlight reasons why your tax return may not be such a great thing, and the different ways you can leverage your tax planning to your own advantage!

Resources Mentioned In Today's Conversation

• From Tax Returns To Tax Planning
• Solo 401(k) to Reduce 2021 AGI

Want to start your own journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!

Big ERN (a.k.a. Karsten) from "Early Retirement Now" makes his return to the podcast in this week's episode! With Brad and Jonathan, Big ERN gives us the lowdown on what inflation is, the role inflation plays in the world economy, and the effect inflation can have on a variety of investments!

Resources Mentioned In Today's Conversation

• Start Your Journey to FI Here

Want to start your own journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!

In this episode, Brad and Jonathan sit down with Paula Pant, author of the ebook Escape and creator of the blog and podcast Afford Anything. As a group, the trio discuss the current landscape of the housing market, whats different between it now and 14 years ago, some tips and ticks for buyers, and whether or not the current housing market is in a bubble!

Resources Mentioned In Today's Conversation

• Sign up for Paula and Jonathan's Live Event on 6/28!

Want to start your own journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!

In this episode, Brad and Jonathan take a look at popular portfolios in the financial independence community and lay down a structure of comparison for them in a fashion similar to that of a horse race! Join us during the longitudinal study to find out which of these various investment strategies is the right fit for you!

Resources Mentioned In Today's Conversation

• All The Hacks with Chris Hutchins
• Level Up Your Dividend Strategy and Optimize Your Portfolio
• JL Collins
• Paul Merriman
• Paula Pant

Want to start your own journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!

In this episode, Brad and Jonathan discuss investment strategies with Brian Feroldi, a seasoned veteran of the stock market and author for The Motley Fool. Brian shares with Brad and Jonathan some insight into the current landscape of the market, why some stocks perform the way they do, and why it is important to take a look at the business behind the stock and not just the value of that company's shares.

Resources Mentioned In Today's Conversation

• ARK Fund
• Brian's Checklist and Early Book Access

Want to start your own journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!

In this episode, Brad and Jonathan are joined by Alan Donegan, an entrepreneurial guru and host of the "Rebel Entrepreneur" podcast. Together, the trio discuss their own entrepreneurial journeys, tips and strategies for up and coming entrepreneurs, and where entrepreneurship could fit within your FI journey!

Resources Mentioned In Today's Conversation

• Salesforce 5-Day Challenge
• ChooseFI Facebook Group
• The Four Hour Work Week by Timothy Ferris
• Millennial Revolution
• Mr. Money Mustache

Want to start your own journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!

In this episode, Brad and Jonathan reexamine the stages and checkpoints of Financial Independence. In our community, many people are just trying to figure out where they are on this path to FI. While every individual’s journey will be unique, when you can gamify the process, the journey can be more rewarding and enjoyable.

Resources Mentioned In Today's Conversation

• Raising Your Money-Savvy Family For Next-Generation Financial Independence
• Subscribe to Brad’s newsletter, The FI Weekly
• The Simple Startup Summer Challenge
• Clothing Shop Online

Want to start your own Journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!  

In this episode, Brad and Jonathan reexamine the stages and checkpoints of Financial Independence. In our community, a lot of people are just trying to figure out where they are on this path to FI, and while every individual's journey is going to be unique, when you can gamify the process, the journey can be more rewarding and enjoyable.

Want to start your own Journey to Financial Independence? Sign up for the free 5-Day FI Challenge here!  

Dennison, a member of the FI community and recent Salesforce success story, joined the guys today for a special interview. He expressed to us that being adaptable and willing to change your world viewpoints on the fly (especially in the face of the COVID pandemic) has allowed him to achieve great financial and personal success.

Resources Mentioned In Today’s Conversation

• Talent Stacker Salesforce 5-Day Challenge
• ChooseFI Episode 117 Making the Case for Part-Time With Bradley Rice

What You’ll Get Out Of Today’s Show

• Picking back up with our ChooseFI Households of FI family, Zach and Marilyn to hear about all of the incredible progress they’ve made since their last episode.
• Like most people, the last year has turned Zach and Marilyn’s life upside down, only their’s has been positive. Following their conversation with Paula Pant in Episode 247, they were felt encouraged to move forward with a real estate investment when the numbers made sense rather than waiting for a property that met all the specific criteria.
• Within two months of their conversation with Paula, they purchased the home they are currently living in. Since then, they have put money in renovations and just rented out the basement apartment.
• Although the original plan was to do a live-in flip, they are now house hacking after taking out a mortgage with a 2% interest rate thanks to their excellent credit, making their new mortgage the same as the mortgage on their previous home that was half the size. Plus, the basement apartment rent is covering the entire mortgage and then some.
• Zach finished school in 2020 and began working in his field earning a good raise. Rather than let the raise inflate their lifestyle, Zach put the entire raise into his 457 plan.
• Between saving more than $1,000 a month on a mortgage and putting $1,000 a month into a 457, Zach and Marilyn have created more than $24,000 of space in their financial lives.
• Although five years ago, they never would have dreamed of being in their current position, they attribute frugality and long-term planning for their success.
• Being on the path to FI feels so good that it’s something Zach talks to people in his everyday life about. He thinks if you adopt the long-term mindset and stick it out during the first five or six years, seeing the end from the beginning becomes less overwhelming.
• Marilyn says that not having debt hanging over their heads has improved their quality of life a hundredfold. While it did take them six or seven years to get there, it wouldn’t have happened at all if they hadn’t taken that first step.
• In looking toward the future, they have created FU money, which they’ve already reaped the rewards of. When Marilyn’s employer told her to come back to work 100% after successfully working from home during the last year, she decided to quit rather than put her kids back into daycare.
• Jonathan appreciates the power of no and says sometimes when you can say no to your employer, it puts you in a position of power where they might be willing to negotiate.
• Zach and Marilyn’s have no mortgage payment, drive paid-off cars, and have an abundance mindset that allows them to live off around $30,000 and want for nothing. In fact, Marilyn uses a hack from Brad and uses an Old Navy credit card for their spending, and earns points to buy clothes for his kids.
• In comparison, most other American families spend $30,000 on just shelter and car payments.
• When leaving previous jobs, Marilyn always felt a bit of panic, wondering how they would make things work, but with living expenses taken care of, they were in a different place. She felt none of that panic.
• Zach grew up without a lot of money and a scarcity mindset. When interacting with people who were well off, he often felt if that person was wealthy that he couldn’t be. The path to FI has been a mind shift to understanding that everybody can win and to a level of empathy.
• What’s next for Zach and Marilyn? Since they are saving more money than ever before, they are interested in optimizing what they do with it. They have considered more rental properties, but prices are high and inventory is low. Index fund investing is another option.
• Prices are high in their area and they looked into renting out their current home, but it doesn’t meet the 1% rule. They would need to geo-arbitrage a second rental.
• If they were to purchase another property, the downpayment would likely come from an old 401k of Marilyn’s. Zach has looked at rolling it into a self-directed IRA for real estate.
• Since Marilyn left that employer her 401k is with, it should have triggered the option to roll it over to an IRA without creating a taxable event as long as she follows her plan’s rules.
• They also have an interest in diversification, but with the real estate market so high, they want to have cash on hand to make a move if it dips. And if the stock market does something crazy, Zach and Marilyn want to be prepared for it.
• They want to invest, just with a shorter time horizon, so they need to invest somewhere with less risk.
• Jonathan says they need to invest like a 55 or 60-year-old. They can achieve that with investments that provide either income stability or a negative correlation.
• They would love to be able to pay for their next property with cash, but they don’t know when the next deal that makes sense will pop up. It could be anytime in the next five years and ideally, they would like to have at least $75,000 saved up for it.
• Although Zach and Marilyn want to do what’s the most optimal with their money, Brad says it really should be what they are comfortable with. Investing in real estate isn’t for everyone and may provide comparable returns to the stock market. They should keep communicating and figuring out what works for them at the moment as it’s impossible to predict where they will be in five years.
• Jonathan thinks it won’t take long to reach financial independence. With annual expenses of just $30,000, they will need $875,000 to hit FI. With $80,000 in investments and adding $1,500 to it each month, they will have $229,000 in 5 years. In ten years, they will have $451,000, and in 15 years, it will reach $783,000 if nothing else changes.
• Future raises, additional rental properties, or Marilyn returning to work can only speed their path to FI. Both Brad and Jonathan believe they can achieve FI in 10-12 years.

Resources Mentioned In Today’s Conversation

• ChooseFI Episode 247 Households of FI-Zach and Marilyn Talk Real Estate Investing With Paul Pant
• ChooseFI Episode 091 Rich Carey Real Estate | Building a Rental Real Estate Snowball Machine Without Debt
• ChooseFI Episode 313 Are you as Diversified as You Think You Are? With Frank Vasquez

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Life gets busy when you have a new baby, so Chris Hutchins is on a quest to learn all the hacks, optimize his life, and share what he’s learned with you in his new podcast, All the Hacks.
• The goal of the podcast is to help listeners upgrade their lives by living more exciting, fulfilling lives without spending a lot more money and optimizing it all along the way.
• Life hacks tend to fall into one of three camps. It clicks with and becomes second nature, you find a way to automate it so you don’t even have to think about it, or it’s too much work and you never do it again.
• If you can find where optimization and excitement intersect, it’s a huge win for you and your family.
• When Chris thinks about life hacks, he thinks about different aspects of his life and what the important parts are, such as family, work, finances, shopping, travel, and self. Categories may also be broken down into multiple subcategories.
• Jonathan says the idea of life hacks and living his life in a slightly more optimized way is what led him to financial independence which he says is the ultimate life hack as it helps us reclaim our most precious non-renewable resource, our time.
• Coming out of a year of lockdown, it seems like everyone is planning to travel somewhere. Chris recommends using Google Flights to get quick insight into flight prices with flexibility on airports and dates.
• For hotel planning, Chris says it’s often a choice between a better price or a better experience. Trip Advisor recently launched Trip Advisor Plus, a paid membership service that allows them to offer hotel rates around 7-8% off because the rates are not available to the general public. However, booking directly with the hotel will likely get you a better experience.
• In addition to booking directly, reaching out to someone on the sales team or the general manager will often get you an upgrade or some sort of amenity. You may be able to find the names of individuals by seeing who is responding to reviews on Trip Advisor. Having status with the hotel can help as well.
• A family life hack Jonathan and his wife began doing is creating a shared family photo library and build a slideshow of their favorites from the year.
• Brad believes another life hack is just being a good person and making personal connections because it makes others want to go to bat for you. A lot of customer service reps have the discretion to do things for you that they wouldn’t if you get angry with them.
• Website account hacks are becoming more commonplace and passwords are frequently stolen so using the same password for everything can be trouble. Check to see if your account has been part of a data breach at Haveibeenpwned.
• A password manager makes it easier to use unique passwords for all your accounts. Increasing security with two-factor authentication helps make your accounts even more secure.
• Chris has a fireproof box in his home where he keeps important documents and the one password he uses with his password manager 1Password.
• In the event of death or incapacitation, a legacy binder has all the information loved ones need to manage your affairs.
• As mentioned on the show previously, Brad uses ToDoist to track all his tasks. Chris says that you can’t use any software system like ToDoist for an hour and see the magic. Commit to it.
• When it comes to renting cars, Chris rents with Avis using a Costco discount. He says to make sure if you’re a member of something, you find out if they have deals for you. Autoslash and Turo are additional ways to possibly save money on rental cars.
• Chase and American Express credit cards have offers to save many when using their cards.
• Listener Jessica asked about life hacks for type A career women and mothers on the path to FI. Chris thinks there is power in being incredibly passionate about a company you want to work for. He also says you can negotiate your salary all of the time especially if you present data that you are being underpaid.
• Before having their baby. Chris was able to find almost half of the items on their baby register in the second-hand marketplace, which allowed them to have everything they wanted and not skimp out on their savings rate. Similarly, Brad’s wife Laura is able to plan ahead for the future and buy seasonal clothing for their daughters at tremendous discounts.
• Another life hack, meal planning, is something that Chris and his wife just purchased for introducing their baby to solid foods. He says there is a bare minimum of what your time is worth. While they could have done it for free, buying the meal plan freed up a lot of their time making the cost worth it.
• Jonathan says for baby clothes, his wife was able to make out like a bandit using local buy nothing groups. Plus, she has been able to arrange a neighbor exchange to keep kids in clothing as they grow. And within their home, they rotate toys to keep them interesting.
• Another resource Jonathan has for Jessica is Dour and Carol’s book, Raising Your Money-Savvy Family, while Chris recommends moms’ groups, who share information and recommendations with each other
• Chris says meal planning is his biggest hack when it comes to cooking. He uses Paprika to save recipes, meal plan, and grocery shop.
• Steven Boyer from CampFI recommends if you cook something often, keep all of the items you use physically together. Brad used a little hack like that to remove the pain points he was experiencing make his morning smoothie prep go more smoothly.
• Holly says if you have a separate freezer, you can buy meat in bulk when they are on sale and then have them whenever you need them.
• Although Jonathan and his wife tried once a month meal prep, they have moved to cooking two to three meals a week and eating leftovers. Chris says he intentionally scales his meal sin Paprika up so that they have leftovers.
• Brad likes to reduce the paradox of choice by eating the exact same meal every day for breakfast and needs a system for lunch.
• To reduce her paradox of choice and frustration, Leslie created a capsule wardrobe for her closet by pretending she was packing for a three-week trip.
• Chris has been culling his wardrobe by separating the clothing he has worn and washed from what stays in his drawers. The things that have remained in the drawers he can get rid of.
• Karen’s daughter hates the idea of college and has an entrepreneurial mindset. Chris says there are so many opportunities to learn these days but the hardest thing is to tangibly identify something you can do.
• Get experience. Starting something doesn’t mean it has to be your full-time job. You can explore the entrepreneurial side while doing something else. Learning new skills is valuable. Try a bunch and see what lights you up.
• You don’t need to go to college anymore to earn an above-median income which is something he discusses in the Talent Stacker podcast. Jonathan and Bradley Rice built a job placement program around Salesforce which might be something Karen’s daughter would be interested in.
• Chris says automation is magical and one of the things that drew him to work at Wealthfront was financial automation where he works on automation that directs your money where you want it to go automatically.

Resources Mentioned In Today’s Conversation

• Lifehacker.com
• ChooseFI Episode 071 Silicon Valley FI | Chris Hutchins | Grove
• ChooseFI Episode 121R How to Get Any Job
• ChooseFI Episode 311 How to Travel For Free | Stereo Live Q&A
• Sign up for the FREE travel rewards course!
• Google Flights
• Trip Advisor Plus
• Haveibeenpwned.com
• 1Password
• ChooseFI’s recommended legacy binder
• ToDoist
• Autoslash
• Turo
• The Buy Nothing Project
• Raising Your Money-Savvy Family for Next Generation Financial Independence by Carol Pittner and Doug Nordman
• Paprika Recipe Manager
• CampFI.org
• Talent Stacker
• Choosefi.com/salesforce
• Wealthfront.com/cash

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• In last week’s Facebook Live episode with Frank Vasquez, he pointed out that we are in the Golden Age of Investing. In this episode, we explore what that means and if we appreciate how good we have it.
• In an ideal world, we would all like to maximize investment returns while reducing volatility. Holding uncorrelated assets helps to prevent catastrophe.
• But what is the goal of investing? Although it’s a broad question, Brad believes the ultimate goal is to accumulate wealth. Investing itself is a very broad term, but it is essentially when the money you have saved is working to produce additional income for you.
• Financial independence is getting to the point when you have saved and invested enough to get to the point where working can become optional.
• In the last 20-30 years, investing has become fundamentally easier. Even Brad’s first investing experience 20 years ago under the old system was a negative one, where he and his lack of knowledge were taken advantage of by an unscrupulous advisor. Back then, you needed an expert to help you invest money and paid dearly for it in the form of fees.
• When many of us think about saving money today, it is through a savings account or certificate of deposit where the bank holds your money and pays you an agreed-upon interested rate in exchange for being able to loan out your money at a higher interest rate. Based on current interest rates, it would take a very long time to make a meaningful return on money invested in this way.
• A more aggressive form of investing would be owning shares of a company’s stock and the value increases as the company become more profitable.
• Bonds are where a company, the government, or other entity raises capital by selling debt. You buy the debt and are paid back with interest.
• Mutual funds are yet another investment that first came about in the 1920s, but mutual funds really rose to fame in 1975 thanks to Jack Bogle when he created the Vanguard First Investment Trust. It was game-changing for modern-day investing.
• With mutual funds, you own a little piece of many different companies with one investment. In the case of an S&P 500 index fund, you would own a little bit of the top 500 largest companies, although it is cap-weighted, meaning you own disproportionally more of the largest companies and less of the smaller.
• The index funds approximate the market and so you don’t need to pick individual stocks to invest in, which is good since we tend to do so poorly at stock picking both on the information and behavioral side.
• Owning a single stock is a risky position. If something goes wrong, the investment can become worthless and your money is gone. You can mitigate that risk by diversifying your investment across multiple companies.
• Jack Bogle changed the game in 1975 when he decided you didn’t need to pay for experts to put together and manage mutual funds comprised of hundreds or thousands of companies. Computers could use an algorithm to manage a fund designed to track a particular index. He predicted you could get a better return from owning all the winners and all the losers and keeping the fees rock-bottom low than with an expert team picking stocks.
• Although the entire investing industry laughed at Jack Bogle, after 25+ years of data, the results show Bogle was right. The process dominates over one of actively picking stocks, especially with a timeline of several decades.
• Today, in the index fund space, there has been a continual race to the bottom when it comes to lowering index fund fees and the expense ratio today has been cut by a factor of 10 or more.
• Something ChooseFI has discussed over and over again is how much of an impact fees can have on your investments. An extra 1% fee can lower your net worth by as much as 30-50%.
• It’s because index funds with expense ratios of 0.04% or lower that say this is the Golden Age of Investing. It’s no longer necessary to pay 0.75-1.5% expense ratios or 5% front-load fees.
• In addition, changes to the tax code have made it possible to control our tax rate. In 1974IRAs became available, followed by 401Ks in 1978, Roth IRAs in 1997, HSAs in 2003, and 457bs in 2010.
• These investment vehicles allow us to control our tax rate and save for financial independence. With the exception of Roth IRAs, all of the other accounts are pre-tax, so that every dollar going in reduces your taxable income.
• Some couples may even be able to reduce their taxable investments by $78,000 if they have access to both 401Ks and 457bs and max out their investments, possibly reducing their taxes to 0%.
• Investing on your own today could not be easier. It can be done on your own, online, in about 15-20 minutes. Even better, you can automate your investing and send over an extra you have when you have it.
• The barriers to entry are also lower than ever before. You don’t need to have your money sitting on the sitting lines until you have accumulated enough to invest. You can start with $10 or $20 and invest in Exchange Traded Funds (ETF) if you don’t have enough to meet the minimum investment for a mutual fund or even buy fractional shares.
• Brad has his finances on autopilot even if it is suboptimal. He suspects many of these new companies are moving toward a system where everything is connected, will be able to optimize everything, allowing customers to keep anything extra invested.
• Jonathan believes making investing seamless is magical. Using dollar-cost averaging as an example, it guarantees a mathematically favorable average price for your investment.
• Brad thinks the most obvious benefit is behavioral. You don’t need to think about when to buy or what the market is going to do. Our brains screw us up with investing more than anything.
• There are a few other forms of investments, outside of stocks and bonds. Real Estate Investment Trusts (REITs) are basically mutual funds for different types of real estate, or ETFs made up of stocks in different types of commodities. Investing in a business, crypto, collectibles, NFTs, art, or single commodities are all other options.
• Speculation and investing can be conflated terms, but they are different. Speculation is not based on the fundamentals of a company or asset.
• Last Fall, Jonathan bought $200 worth of DOGE and just sold it for $5,000. While the gain is real, his purchase was entirely speculative.
• He remains skeptical of cryptos in general but sees where there may be value in cases where a problem is being solved, such as XRP and Swift.
• With any investment, you don’t want to be the one left holding the bag. Know what your risk tolerance is, what your timeline is, and what your goals are.
• With buy and hold investing in large swaths of the market, you don’t have to worry about whether or not you have the winners or the losers. The market is self-cleansing.
• As long as you keep living below your means and investing the difference between income and expenses, you’re going to be successful.

Resources Mentioned In Today’s Conversation

• ChooseFI Episode 313 Are you as Diversified as You Think You Are? With Frank Vasquez
• Register to receive a copy of Brad’s weekly email, The FI Weekly, right to your mailbox!
• ChooseFI Episode 013 The Unfair (FI) Advantage of Teachers | 457b
• Motley Fool article: Dollar Cost Averaging: What Investors Need to Know

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• “When you are financially whole in the way I’ll teach you to be, you won’t have to live in fear. You’ll have a plan for each area of your finances so that they are constantly working on your behalf“. — Tiffany Aliche
• America’s favorite budget expert, Tiffany Aliche joins us to discuss her new book, Get Good With Money.
• Financial fear can come from financial trauma and drama. When you know that the money you are making isn’t quite enough for the things that you absolutely need, or you can foresee a future when your finances will not be okay, most of us carry that fear secretly and with a sense of shame.
• Tiffany wants her community of more than 500,000 Dreamcatchers to release that shame, focus on solutions, and create plans that actually work.
• According to Tiffany, wealth is more than just money in the bank. It’s really a mindset, which is the building block of personal finance.
• People often chase an end goal without a foundation to ensure they will still be okay if something were to happen.
• Tiffany’s teachings are foundational. The goal is to give you the foundation that you need to go on greatness, such as investing at a high level, buying the home you want, or starting a business.
• For many of us, fear comes from a lack of knowledge and it takes an external, traumatizing incident to awaken us. Tiffany wants to reach people before they get to that point by normalizing financial education early on.
• Tiffany’s approach is three-pronged: knowledge, access, and community. She delivers knowledge through her blog, The Budgetnista, and podcast, Brown Ambition. For access, she showcases other financial educators, like the ChooseFI Foundation, to those who want a financial education for the children and community. And finally, she built Dreamcatchers for the third prong, community, so that people know they are not alone.
• The 10 components that constitute financial wholeness are budgeting, savings, debt, credit, and learning how to earn for the first tier. In the second tier, she includes investing for retirement and wealth, insurance, net worth, your professional money team, and estate planning.
• This foundation of financial wholeness is what you build the rest of your goals, hopes, and dreams on.
• While writing her book, Tiffany decided to Google, Jake the Thief, a man from her past who had caused her financial trauma. She discovered that he had escalated his thieving behavior from poor 20-something-year-old women to defrauding the United States Government and he is currently sitting in federal prison.
• Jake’s story is a cautionary tale. Sometimes the wrong thing or risky behavior works for a short period of time. But it’s important to learn how to manage your money from the ground up versus from the top down because you can lose it all if you don’t know how you really built what you built.
• Tiffany ended up with credit card and student loan debt and a mortgage she could no longer pay for, In total, it was around $300,000 in debt.
• That experience taught her that her father was right, slow and steady wins the race. She now takes her time and is very methodical with her decisions. Even it means taking a loss, she’ll take a short-term loss if it means a long-term win.
• Once she built her foundation, she was able to build wealth much more quickly. She wants others to have the opportunity to build the life that they want.
• After reading her book and matching one of her workshops, Jonathan says he likes how good Tiffany is at organizational structure and categorizing things.
• With budgeting, Tiffany assigns control categories to expenses. First, she lists all of the expenses and then assigns them to categories.
• The first category is B, or bills, like a mortage. Some of those bills are usage bills that fluctuate depending on usage, such as water or electricity. She puts a U in front of those Bs.
• Everything else is a C, meaning cash or choice expenses, because these are expenses you have choices over, like haircuts or gas for the car.
• Categorizing in this way can help determine if you have a spending-too-much issue, or a not-earning-enough issue, when there isn’t enough at the end of the month. If most of your money is going to Cs, you are spending too much because of your choices. If most is going to Bs and UBs, you aren’t making enough to take care of your financial responsibilities.
• When things are temporarily tight, you know you can look at your Cs and make some cuts there first. If it’s not enough, move to the second level, UBs. If that’s still not enough, move up to the Bs.
• Tiffany’s father taught her in an age-appropriate way about the financial consequences of her actions and says it’s a lesson we could learn as adults.
• A budget isn’t deprivation, Tiffany says it’s your “say yes plan”. Budgets are like your mom. She wants to say yes, but there is an “if” button. You can do the things you want, but only if you’ve lined yourself up in a way that makes it sustainable and safe.
• If you can master your budget and look at it differently, it is there to accommodate your goals, hopes, and dreams. But it might require you to give something up.
• Jonathan thinks Tiffany’s book speaks well to those who are broke. When writing it at the height of the pandemic when people were losing jobs and scared, she didn’t want to leave behind those starting in negative territory.
• She wanted to give them permission to focus just on their sleep, health, and safety. It’s okay to focus on expenses related to health and safety and tell everyone else that you don’t have it right now. You will get to them when you get to a safer place financially.
• 30% Whole is the chapter Jonathan thinks is worth the book’s price all on its own and you really need to know these tips if you are in debt, such as dealing with debt collectors or mortgage lenders during foreclosure. You can insist on a debt verification letter to verify that they have the right to inquire about it.
• Debt freedom is a goal, but it’s not the goal. You can be debt-free and still broke. Financial freedom is an incomplete picture. There may still be holes in areas like insurance and estate planning.
• The FIRE movement is great, but Tiffany believes there is a holistic view that is missing. Not matter how high or low your income, financial wholeness is available and accessible to everyone.

Tiffany Aliche

• Website:  The Budgetnista
• Podcast: Brown Ambition

Resources Mentioned In Today’s Conversation

• ChooseFI Episode 240 From Financial Imperfection to America’s Favorite Budget Expert | Tiffany Aliche
• Get a copy of Tiffany Aliche’s book at getgoodwithmoney.com.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• After four weeks of hosting the live weekly show via Stereo, Brad and Jonathan continue to refine the format and come up with ideas for improving the experience.
• Jonathan needs some specialized dental work performed and the dentist he found is out-of-network. Insurance isn’t going to cover much in this situation, but thankfully, it doesn’t put him in financial straits.
• As they reminisce about being children of the 80s, Brad and Jonathan come to the conclusion that time moves on and the rulebook changes. If you are stuck in a world that doesn’t exist, you aren’t going to be successful. Be aware that things change and be open-minded.
• Google is coming out with its own certificate programs in project management, data analytics, and user experience design through Coursera what will cost most around $250. Google is partnering with 130 other companies to partner with them to hire the graduates of these programs.
• In past decades, a college degree may have mattered, but in 2020, employers are looking for what can you do or what have you done, not necessarily the degree.
• Listener Colin called in to say that he started a side hustle last year teaching people computer programming and asked about how to go about finding new clients. Jonathan says that as a business owner, Colin has a product he has created and needs to figure out how to deliver that product, ensure a great experience, find new customers, and finally scale and grow the business.
• For Colin’s business, is there an awareness problem or is there a problem converting awareness into sales? Brad says something that has worked for him is making connections within his niche and be authentic. Jonathan suggests establishing yourself as a subject matter expert using LinkedIn and Quora and a blog or podcast to begin attracting people interested in the subject.
• Another thing Colin should do is demonstrate his course has value, get testimonials, and constantly test and iterate.
• Marjorie called in because she knows how much Jonathan loves the Paprika app, but recommends a similar app called Whisk. It can download recipes from the internet, but you can also take pictures of recipes to upload to the app. Plus, it organizes recipes really well, has a weekly meal planner, and can create a shopping list.
• The next caller said she loved the coaching call that Jonathan did with Corrine and would love to hear more of those kinds of episodes. Jonathan worked with Households of FI member, Corrine to map out her FI number. Jonathan recommends watching the video for that episode because he shared a lot of screenshots while working with Corrine.
• Similar to the recipe app Whisk, Brad said that he could have saved money on his recent CT scan using MDSave. Instead of being charged $2,093 for his scan, a provider found through MDSave would have cost him just $289. He was eventually able to negotiate the bill down to around $1,300, but that is still much higher than he needed to pay.
• The next caller from LA is a side hustle addict. He has been self-employed his whole life and realizes that his nest egg is very small. He wants to know where he should focus his investments for retirement.
• The caller has a choice between a SEP IRA, a Simple IRA, and a solo 401K. There may be some advantages to using one over the other depending on the size of the business. Brad has set up a SEP IRA and thinks that a solo 401K would have allowed him to defer more money by contributing as the employee and employer. A SEP IRA only allows for employer contributions.
• If he still meets the income thresholds, the option for a Roth IRA may also be available. There is little downside to contributing to a Roth IRS since contributions can be withdrawn tax and penalty-free.
• The next caller shared what they would do if looking for a career move. For their technology and financial services company, they would focus on people and find out everything they could about them so that they could engage in relevant small talk. This advice follows nicely with the points Chris Hutchins made in episode 121R.
• A weak point for a lot of is how can you build a system around building authentic relationships over time? This was something discussed with Jordan Harbinger in episode 233.
• The next caller wants to know how to account for a mortgage that you expect to pay off during retirement when calculating your FI number. Jonathan plans to pay his mortgage off before beginning to drawdown his investments, however, he calculates his FI number based on what his life costs with a mortgage. It gives him a bit of a fudge factor.
• Your FI number is calculated by taking your annual expenses and multiplying it by 25. If you plan on paying your mortgage off before retiring, remove the payment from your annual expenses. While principal and interest can be eliminated, taxes and insurance will not be and should be included in your annual expenses. A multi-phased approach will need to be employed to calculate your FI number if planning on paying off the mortgage during retirement.
• Listener Phil called and left a voicemail asking about tax tips for those with side hustle income and how to balance work-life, side work, and life in general.
• Jonathan thinks turning a hobby into a business is a great way to explore something within the confines of a business entity. Brad’s tax tip is good record keeping and keeping things separate from your personal accounts.
• Jonathan also likes the thought of putting advertising expenses on a business card that earns travel rewards, like the Chase Ink Business Preferred, since advertising is a legitimate deductible business expense.
• A work-life balance can be tough. Jonathan says the biggest misconception is that you’re always going to be balanced all of the time but there will be sprints and tilts. It’s how it averages out over time.
• Experiment and test a bunch of different things, but don’t put a massive amount of time into something with no ROI or thought to the balance and other areas of our life.
• If you aren’t going to be in balance and there are other people relying on you, have a conversation about it. Communication will always buy you more room.
• Map out the cadence to your life and realize where you have control of your time. You might have a boss that needs to sign off on it, but if you work for yourself, you don’t need to ask for permission to make time.

Resources Mentioned In Today’s Conversation

• ChooseFI Episode 121R How to Get Any Job
• ChooseFI Episode 304 Mapping Out Your FI Number | Households of FI with Corrine
• MDSave
• ChooseFI Episode 274 Tax Planning 2020
• ChooseFI Episode 289 The Roth 401K
• ChooseFI Episode 233 Networking with Jordan Harbinger
• Join us for the next live show at ChooseFI.com/live.
• ChooseFI.com/cards
• ChooseFI Episode 168 Make Time
• Learn why the Chase Sapphire Preferred is one of our favorite cards.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• It’s the third edition of ChooseFI’s live and interactive show via Stereo. You can submit a question, feedback, or comment, and find out how to join us for the live event by visiting ChooseFI.com/live.
• Brad and Jonathan are getting high on life. Not only have Brad’s daughters started back at in-person school, but he and Laura were also able to attend a Crossfit class together. Meanwhile, Jonathan is successfully combating fatigue by getting the right amount of sleep, cutting out caffeine, and maintaining high hydration levels with juices.
• In an ongoing effort to get 1% better, Brad recently reviewed his credit card bills. He found a $50 recurring charge for his daughter’s saxophone rental and decided to buy it for $500 rather than continue incurring the rental fee. He suggests doing this twice a year and asking if those recurring charges are continuing to serve you.
• Jonathan recently canceled his Netflix subscription and wonders if there is a way to the effort of it and streamline our finances.
• In a hypothetical example of a $2,000 car loan with a 2-3% interest rate, Jonathan asks if Brad would just pay the balance off versus keeping a monthly payment. At that low of an interest rate, Brad would not, but because of the intersection between math and psychology, there are others so debt adverse that they would pay it off.
• For higher interest debt or 8-12% or more, Brad believes that is more of a hair-on-fire scenario in which paying the debt off as quickly as possible would be best.
• Regardless of which side of the scenario you fall on, there is nuance and stigma. Rather than allow others to tell you what you can and can’t do, it’s important to know yourself and why you make the choice you do.
• Understanding the why behind the car payment is a better thought exercise. If it’s because it gives you the cash flow to finance even more stuff, it can grow to become a difficult position is dig yourself out of. Financing allows you to trade your most precious non-renewable resource, time, for more stuff.
• With every dollar you are saving, are you using it to invest, or are you buying more stuff? If you are continuing to buy more stuff, then you are still in the trap and aren’t looking at money as a tool.
• Because Jonathan is a spender, he wants to keep things simple and doesn’t like having structural payments. In the hypothetical scenario, he would feel the need to pay off even a low-interest rate car loan.
• The first listener voicemail wants to know how much in retirement is enough to adequately cover long-term care. His original goal was $10 million at age 65. According to the 4% rule, that would give the listener $400,000 a year to live off of, which is a big number.
• It comes down to what does your life cost? Traditional retirement calculators all start from the point of “what do you earn today”, rather than “what does your life cost”. Your income is irrelevant. In retirement, you need to cover what your life will cost.
• Health care insurance is based on actuarial tables put into place to ensure the provider doesn’t, in aggregate, lose money on you. The same is true for long-term care insurance. It’s priced so that providers don’t lose money on you. What is the effort to reach a $10 million balance to cover the cost of long-term care costing you in terms of time and health now? You can focus on putting systems into place now that give you the best chance to reclaim decades of quality life.
• Rob Phelan, fromThe Simple StartUp, called in with a question about being open to new technologies and investments.
• Brad isn’t a first-mover on anything. However, he has a diverse set of interests and prides himself on knowing when the tipping point is to jump in earlier than the average person. He’s done some reading on non-fungible tokens (NFTs) and believes they could be transformative 10-20 years from now.
• Jonathan’s process is curation and synthesis. When he reads, he skims everything and sees the point when something new becomes real. He’ll do a deep five if it fits into one of the buckets he’s interested in. He’s been doing that deep dive into crypto and blockchain, but not NFTs.
• While neither Brad nor Jonathan can get behind spending $2.5 million for Jack Dorsey’s first Tweet, they do agree digital ownership is interesting because of all the unique ways the concept could be implemented.
• Next up is a seven-year-old who says they want to learn about investing. It starts with saving. What Brad tells his own kids is that life gets so much easier if you can save money. If you spend every cent you earn, it takes away a lot of choices in life and gives them fewer options. The higher you can make your savings rate, the more freedom you’ll have.
• As for investing, think long-term, like many decades of investing. With a long investing horizon, the best chance at being really wealthy is with low-cost broad-based index funds or ETFs.
• When Jonathan’s kids are older, he thinks he will try and attach a real company to the discussion and carve out a portion to invest in it. It would be one they know and has products they get excited about to help make the feeling of ownership real.
• Natalie called in to say that she just opened an M1 Finance account for her traditional IRA contributions as well as a savings account so she can earn 1% on it. However, she’s never done a portfolio rebalance.
• Rebalancing can be scary and easy to avoid. It comes back to having a plan and an investor policy statement and not letting your brain get in the way. M1 can do this automatically and there may be some tax consequences if it is done in a taxable account.
• Rebalance in your portfolio totality, not within individual accounts. If you don’t have a plan, go and figure out what your goals are and have the plan match them. Rebalancing can also be done by making weighted contributions.
• James, who is in Jonathan’s podcasting course, asks about speeding up his path to FI by purchasing multi-family real estate by withdrawing from a 401K and obtaining a HELOC.
• While there are likely both success and horror stories of others who have gone that route, Jonathan would look for ways to avoid 401K withdrawals or taking a line of credit against your home.
• Brad would only go into his 401K as a last resort. 401K withdrawals are subject to a 10% penalty and would be taxed as ordinary income.
• Rather than a 401K withdrawal, Jonathan says that if the deal is good enough, the money will come. Bringing on additional investors may be an alternative. Network, be creative, and try to cap the downside.

Resources Mentioned In Today’s Conversation

• Join the live show Tuesdays at 7:30 Eastern with Stereo!
• ChooseFI Episode 297 From Pandemic Layoff to $100K+ | A Salesforce Success Story
• Start your new language learning journey today with Babbel and get six months for the price of three with promo code “ChooseFI”.
• ChooseFI Episode 016 House Hacking with Coach Carson

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Jonathan checks back in with Corinne from the Households of FI series to look at her numbers, goals, and map out a FI plan.
• Financial independence is not about having the most money. In the pursuit of FI, the math is simple, but the math will change depending on your goals. It’s important to start with understanding what you want your ideal day to look like.
• Following Corinne’s last coaching session with Jillian, she learned how to build good habits and strategies to get closer to the goals she wants.
• One of the strategies she’s using is her phone to set reminders for the goals she wants to achieve. The reminders hold her accountable without her having to remember everything.
• Jonathan pointed out one of the great pieces of advice from the episode with Jillian was her advice to explore the goals you find yourself resisting giving even two minutes to. What is it in your subconscious that is sabotaging your goals?
• Corinne is on track to become a partner at her firm but that comes with a lot of expectations. In an exercise with Jillian, she was asked to write down what her ideal day would look like. to start, she’s been writing down which activities are energizing and which are draining. It has helped her to manufacture her day to be the kind of day that makes her want to get up and go to work in the morning.
• She discovering that she doesn’t have to work as many hours as everyone one else. She can balance it out, earning a little less money while being happier.
• We can make time to make each week more memorable and enjoyable when we spend less time on meanless activities.
• When you take what earn and subtract what you spend, what you are left with is the gap. When you live paycheck to paycheck, there is no gap.
• Corinne earns $120,000 a year as an accountant. She was in a five-year program where she got her Bachelor’s and Master’s degree that gave her enough requirements to take the CPA exam. Due to a scholarship, she graduated without any student loan debt.
• A similar recent graduate starting out now would make around $50,000 a year. She was able to double her salary and excel by narrowing her focus and becoming an expert in that space.
• In her industry, there are clearly defined roles with specific salary ranges. Increasing income requires the desire to progress and take on more responsibility. Becoming a partner wasn’t always on her radar, but she liked the idea of having ownership in the business.
• Corinne hasn’t researched the details of the retirement payout for partners at her firm, but there is some form of payout in retirement. Since she is on the trajectory to becoming partner, being able to project the retirement payout will help to calculate her FI number.
• One of Jonathan’s favorite income tax calculators is at Smartasset.com because it will incorporate state and local taxes. Using Corinne’s salary, he calculates her federal tax plus FICA and Social Security is $29,227. Since she maxes out her 401K, it reduces her tax to $23,000 and saves her more than $6,000 in income tax. The income she brings home is then $77,445, or around $6,500 per month.
• Now looking at Corinne’s expenses, her mortgage is approximately $1,000 and she spends $500-550 a month on food. She does not have a car payment but between gas and other expenses, it’s around $100 a month. Utilities run $400 per month. Additional budget categories include dining out and shopping for $500, charitable giving at $200, housekeeping is $100, and her HOA bill is $150. Though travel is on hold at the moment, she’s like to budget $250 a month for vacations. And finally, an additional $200 was included to cover odds and ends.
• Corinne’s total monthly cost-of-living is $3,375. To find out her gap, Jonathan takes her net monthly pay of $6,500 and subtracts her monthly expenses of $3,375 to calculate a gap of $3,125 each month.
• Jonathan suggests putting the gap to work for her as quickly as possible and sending it to her investment strategy. Before doing this exercise, Corinne had no idea what her gap was and grabbed a random number to move to savings.
• To start working on a plan for financial independence, Jonathan uses net worth and age. Corrine’s 401K balance is about $150K and her taxable account has another $100K making her invested net worth $250,000. She is 32 years old.
• Using ChooseFI’s simple Retirement Projection calculator, Jonathan plugged in Corinne’s numbers. Her FI number is $1,012,500.
• Next, Jonathan uses ChooseFI’s Future Value of Investments calculator to project how many years it will take Corinne to reach her FI number through both the growth of her current invested balance and her monthly contributions. Using an 8% rate of return, in 10 years Corinne will have $1.4 million far exceeding her FI number. Sometime between 7 and 8 years is when she will reach financial independence.
• The exercise is energizing for Corinne who previously thought she would need to eat rice and beans to reach financial independence in 10 years. She was nervous to see the numbers but now finds it motivating. Her next step will be to ensure she’s taking that extra money every month and putting it to work for her.
• Once you’ve got what you earn, what you spend, identify the gap, and decide what you’re going to do with the gap, you’ve got your FI plan in place.

Resources Mentioned In Today’s Conversation

• Join the live show Tuesdays at 7:30 pm Eastern on Stereo!
• ChooseFI Episode 243 Households of FI | Corinne and Jillian Johnsrud
• Watch ChooseFI episodes at ChooseFI.tv.
• ChooseFI Episode 168 Make Time
• Smartasset.com
• Apps.choosefi.com
• Take ChooseFI’s free 5-day challenge.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• In the second episode in the series of taking the show live online via the Stereo app, listeners ask questions and interact during a replay of this live podcast from Tuesday evening.
• Experimenting with this new show format, Brad and Jonathan are adding to their talents stack and themselves getting better through the often mentioned concept of the aggregation of marginal gains.
• Unfortunately, just because you make progress in an area, it doesn’t always mean you hold on to those gains. While your finances can be put on autopilot, physical and mental health are areas prone to backsliding. Take a little time for self-care.
• While reaching financial independence isn’t as simple as packing your lunch every day, it can be symbolic of the transformation to a mindset to take care of all the small things. It’s that effort, in the aggregate, that gives you the space to increase your savings rate, optimize investments, and earn market gains.
• Brad has been trying to apply the concept to his health, which has also required that he overcome several limiting beliefs. All of the changes he’s been making are small, like stretching, doing pushups, or yoga in the evening while watching TV with his family. And after hearing about how important vitamin D is to metabolic health, he tested his levels and found out they were dangerously low.
• In his attempt to live a more examined life, Brad has noticed certain foods lead to inflammation, and that his energy level fluctuates with the seasons.
• Likewise, Jonathan has been examining his use of caffeine and trying to decide if he is better off with it or without it. He would prefer to have a natural, steady energy state. He’s noticed that by decreasing processed sugars, he has more energy and wakes up fresher.
• Brad has been using a 10-minute nidra yoga YouTube video as a guided sleep meditation and says it’s like getting a two-hour nap.
• Listener Jackie left a voicemail asking about taking a little risk by putting emergency funds into the bond market. Jonathan says there’s no one answer, but he thinks we need to look at what we’re protecting ourselves against and the opportunity cost that comes with having a lot of money on hand to handle emergencies.
• Most of us will benefit from having $1,000 in the bank to start, and then moving to one or two months of expenses in cash. As your net worth grows, Jonathan would prefer to have the money in a fully-funded emergency fund grow.
• Since recording episode 066 with Big ERN, Brad has been trying to come up with a true financial emergency scenario. He’s been unable to think of a scenario when he might need cash in a hurry that couldn’t be covered immediately with a credit card. In a true emergency, he has invested assets he could sell and transfer to his checking account to then pay the credit card bill.
• When you keep an emergency fund in a savings account, the opportunity costs are the potential gains that could have been made by having those funds invested.
• Jonathan keeps a couple of months of cash flow. In addition to retirement investments, he also has a taxable brokerage account with M1 Finance. His investment pies in M1 have been allocated for different timelines. For his shorter timeline fund, he thinks about it more like a retiree would and wants it stable. Therefore, he keeps it in a fund that is negatively correlated to the stock market, such as bonds and precious metals.
• For emergencies, one of the benefits of M1 Borrow is access to a low-interest margin loan against your invested non-retirement assets.
• The second listener voicemail asks about the ability to convert and access 401K investments after a five-year waiting period for someone who retires early. Brad believes the listener has a Roth 401K, in which contributions are made with after-tax dollars and may be withdrawn tax-free. The five-year waiting requirement applies to Roth IRA Conversion where traditional 401K contributions are converted to a Roth IRA and it is a taxable event. When rolling over money from a Roth 401K to a Roth IRA, it is not taxable and there’s no wait to access contributions. At 59 and a half, all of the money may be accessed penalty-free.
• A listener in the Netherlands wanted to know if Brad and Jonathan would consider having a guest from another country on the podcast. Since the FI movement is worldwide, ChooseFI has listeners from all over. Exploring non-American guests is definitely something to be examined for general FI topics, as it would be difficult to speak about other countries’ tax codes. The ChooseFI local groups in international locations would be a great option and resource.
• Listener Gavin asks about how best to decide post-FI plans. Jonathan stresses that FI is a number and not an action. It does not mean you have to leave your job. FI gives you options, time, and resources and allows you to explore what you want to do with those. Having some space financially allows you to make choices from a position of power. You can make small-scale tests before wholesale life choices. The money is the easy part. Figuring out what lights you up is the difficult part.
• Listener Natalie has connected with the idea of maximizing her savings but is sitting a significant amount of cash while she decides between renting and buying. She wants to know how easy it is to put money in the market if she might need it in three to five years. Of the big traditional brokerages, Jonathan thinks Fidelity is the easiest to learn from a user interface perspective.
• Of the software-based institutions, he likes M1. Brad says from purely a conceptual-level, it’s easy to get money in and out of the market as they aren’t subject to the same rules retirement accounts are. However, it’s good to note that the stock markets have business hours and may be closed when you want to make a transaction and that some companies like M1 limit when transactions can take place.
• In live feedback of the 401K discussion, a listener pointed out that there is a phantom five-year clock on in-plan Roth conversions.
• Marjorie left a voicemail that she is trying to get her family back in Puerto Rico on board and is looking for Spanish language FI resources. Jonathan has been helping Lorena start a Spanish language personal finance podcast, De Peso a Peso.

Resources Mentioned In Today’s Conversation

• Join the live show Tuesdays at 7:30 pm Eastern!
• The Tim Ferris Show
• The Peter Attia Drive Podcast
• Ulta Lab Tests
• The Huberman Lap Podcast
• Yoga Nidra
• ChooseFI Episode 066 The Emergency Fund…Is it a Bad Idea? with Big ERN
• ChooseFI Episode 194 The Role of Bonds in a Portfolio
• Risk Parity Radio
• ChooseFI Episode 292 The Complexity in Simplicity at M1 | Brian Barnes
• M1 Finance Review: Completely Free Automated Investing
• ChooseFI Episode 289 The Roth 401K and Meal Planning Made Easy
• Find your local ChooseFI group.
• ChooseFI Episode 049 Alan Donegan and The Escape Artist | The Aggregation of Marginal Gains
• ChooseFI Episode 117 Making the Case for Part-Time with Bradley Rice
• ChooseFI Episode 047 The Cult of Home Ownership and Crushing Geo-Arbitrage | Millienial Revolution
• De Peso a Peso Podcast
• ChooseFI.com/network
• Join Jonathan’s free podcast course at Talent Stacker.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• We are checking back in with Vivan from our Households of FI series who has been paired with mentor, Tae from Financial Tortoise, to go over strategies, best practices, and considerations for multiple generations living under one roof.
• In many Asian cultures, adult children are responsible for taking care of and being financially responsible for aging parents while also raising their own children, often referred to as the Sandwich Generation.
• Whether or not being financially responsible for parents is part of your culture, caring for or assisting them to make decisions as they age may be in your future.
• Tae writes from the perspective of the Sandwich Generation on his blog, Financial Tortoise. Living with him and his wife are his two kids and both of his parents. During the last 10 years in this living arrangement, he’s paid off $105,000 in student loans and is pursuing financial independence.
• Vivian has been fighting breast cancer while dealing with a separation and child custody battle. She also has her mom living with her, who is helping out with her child, but she finds that there are generational differences leading to misunderstandings. She has questions about what kind of disability or long-term care insurance she would be getting for them.
• At 61, Vivian’s mom doesn’t yet qualify for Medicare and hasn’t applied for Social Security, but she does have a small pension from working for the Los Angeles School District. Tae thinks there may be healthcare gap insurance available if her mom qualifies.
• Her mom retired from work last year. If she applies for Social Security early at 62, she’ll earn 20-30% less. If she waits until age 700, she’ll earn 20-30% more. As long as she has paid into Social Security for at least 10 years, she is eligible. If she hasn’t been receiving paper summary statements, she can check online and see what her estimated benefits will be.
• Tae’s parents moved in with him right when they began collecting Social Security. They didn’t understand retirement accounts, but they did have real estate and rolled over equity into the down payment for a new home they could all live in and Tae took over the mortgage.
• Since Vivian’s mom lives with her, she shouldn’t have major expenses and her pension and Social Security should be enough to live one, but she would like to travel so Tae suggests looking into travel hacking.
• As for healthcare, Vivian’s mom retired because of health issues and is no longer able to work. She currently pays for private insurance, but at 61, there isn’t an ideal solution until age 65 when she becomes eligible for Medicare. She will need to enroll 3 months before she turns 65. Basic Medicare is covered, but if she wants things like hospital visits covered, she will pay a premium that is taken directly from Social Security if she is collecting it.
• Tae does not have long-term care insurance for his parents because it is hard to find affordable long-term care insurance now, but skilled nursing and assisted living may be alternatives. The best thing you can do is to take care of yourself. He thinks people in the FI community have the advantage of having more time to spend figuring out a care solution when the time comes.
• Vivian asked if Tae his FI plan included healthcare spending for his parents. He does not, but he does plan for them to age in place, which means maintaining the larger home.
• Living through the Vietnam war has created conflicts in some areas, like hoarding food and water. Her mother helps out with cooking, child care, and food costs, but Vivian pays for everything else.
• One of the reasons why Tae decided to try co-habiting with his parents was for help with childcare. It helped them fully commit to their careers. While there can be a huge cultural chasm when living with your parents as adults, Tae has learned empathy and takes time to try and understand where they are coming from.
• Rather than try to control what his parents are doing with their money, Tae tries to ensure his own expenses are as strong as possible. If something were to happen with his parents, if his own finances are strong, he’ll be able to figure out how to deal with it.
• Vivian is trying to save 50% of her income as a pharmacist and her parents think she is being stingy, which runs counter to many Asian cultures where you wear your wealth.
• She was excited when she found ChooseFI because she previously believed you needed to have your own business to become financially independent. She’s now following the advice in The Simple Path to Wealth.
• Saving for college is another question Vivian has. Tae’s children are 4 and 6 but he’s started 529 accounts for them since there is some flexibility with them. However, he believes the future of work could look different. He thinks about how he can help his children become productive adults rather than blindly save for college.
• Tae thinks it’s good to start thinking about estate planning with her parents. He and his wife just did their own, setting up a trust and power of attorney which motivated his parents to do the same.
• There is a cost for everything and there are both positives and negatives when putting families together under one roof. You have to be aware of it going in.
• The major takeaways from Tae and Vivian’s conversation are the need for managing the gap before Medicare kicks in, navigating Social Security, and feed estate planning.

Tae

• Website:  Financial Tortoise

Resources Mentioned In Today’s Conversation

• ChooseFI Episode 186 Mulitple Generations Under One Roof With Financial Tortoise
• ChooseFI Episode 221 Introducing Our Households of FI! Part 1
• ChooseFI Episode 255 Vivian Connects with Leslie Tayne
• SSA.gov
• The Simple Path to Wealth by JL Collins
• Smart Money Mama’s Family Emergency Binder
• Get started on your path to financial independence at ChooseFI.com/start.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• What are you getting hung up on with relationships and money? We continue the conversation in Part 2 of the Relationships and Money series with Jillian Johnsrud.
• Although March is finally here and the sunshine is motivating Jonathan to push away the processed carbs in favor of broccoli and hummus, Richmond’s recent ice storms had Brad using his stash of travel rewards for the first time in over a year.
• Travel rewards come in handy at home too. After losing power from the storm, Brad called up a local Hyatt to see if they had power and was able to use 5,000 with Hyatt to book a room, and quickly move his family out of a cold home for the night. If he had been short on Hyatt points, he could have quickly transferred Chase Ultimate Rewards points over to cover the rate.
• Even if you aren’t ready to travel now, plan ahead and start stockpiling travel rewards points now so you have them once you do want to travel again. Take the travel course at ChooseFI.com/travel to learn how.
• The next roundup episodes will feature Alan Donegan and focus on building a business in 2021. Submit a voicemail with the questions and concerns you would like to have addressed at ChooseFI.com/voicemail.
• Have a question on a different topic? Submit your voicemail and join the live radio shows held on Stereo, Tuesdays at 7:30 pm Eastern.
• In Episode 300 with Jillian, she discussed how your past money story motivates you and creates fear as it pertains to money and relationships. Part 2 of the series examines being financially independent while still dependent.
• Listener Asia is engaged and works full-time while her partner is still going to school and works part-time. They each have vastly different money stories and have started combining finances. Her partner is still receiving some financial support from her parents. While her partner wants to begin become more independent, Asia wonders if it would be smarter to continue as things are.
• Jonathan sees three issues with Asia and her partner’s situation: attachment, boundaries, and economics. For Jillian, one of the elements was what habits and practices Asia’s fiance can take to feel like a financial grown-up and equal partner in the relationship. She also considered what it might mean for the fiance to receive from her parents, as well as what it might mean to the fiance’s parent to give.
• Jonathan sees nothing wrong with accepting help so long as there are no boundary or communication issues or strings attached. Brad thinks it sounds like a positive situation but is also concerned about ulterior motives.
• After graduating college, Brad lived at home with his parents while saving 90% of his income which gave him a huge jumpstart on his path to FI.
• Jonathan noted that there could potentially be some tax-filing issues that could be related to the child tax credit and paying for dependent healthcare that could be important to figure out.
• Jillian says society’s rules don’t matter, you can write your own rules of what it means to be a financial grown-up without there being a contradiction. Help can be a sweet thing family can do, but even she had issues with family members trying to control her with financial assistance while she went to school.
• There are other things you can do to feel like a financial grown-up, like tracking expenses or coming up with a debt repayment plan. You can be a financial grown-up, take advantage of opportunities without taking advantage of relatives as long as your goals are aligned and they want to see you succeed.
• Brad wants to be able to help his kids out when they are older. He respects parents who charge their children rent and teach them to be financially responsible, but he hopes to instill those lessons throughout childhood.
• Listener Precious will be getting married soon. So far they have been sending money back and forth to each other, but she wants to be more efficient and is wondering what the best way to begin combining finances is.
• While Jillian wants to believe all love will last forever, she advises against opening up a credit card together in the first few years of marriage due to the bills being divided up in a painful divorce process. However, opening up a joint checking account is a good baby step since at worst only the money in the account can be spent without going into debt. How much each person contributes and what bills get paid from it opens up the lines of communication.
• When you are young and your finances are simple, combining all of your finances makes a lot of sense. In contrast, Jillian’s financial life is much more complicated and if she had to remarry, she isn’t sure she would combine her finances with anyone else.
• Credit card and car debt can be kept separate, but it’s usually better to have both names on a home loan since real estate is an asset being grown together. But also so that it doesn’t become a painful process to untether if necessary in the future.
• In a new marriage, Jonathan says he wouldn’t feel comfortable being a co-signer on a credit card since he would be legally responsible but have no insight into what was going on until it crashes into a wall. On the other hand, adding an authorized user gives you more control and insight into how the card is being used and it can be revoked.
• Brad and Jonathan have their own bobblehead figure! It was given to them by All-Star Money for being creators of content who inspire readers to improve their financial situations and helped develop an engaged personal finance community.

Jillian Johnsrud

• Website:  JillianJohnsrud.com
• Podcast: Everyday Courage

Resources Mentioned In Today’s Conversation

• Join us for the live show Tuesdays at 7:30 Eastern on Stereo. 
• Travel more and spend a lot less with the ChooseFI Travel Rewards 101 course.
• The Chase Sapphire Preferred Card—Great for Cash Back or Travel Rewards
• ChooseFI Episode 300 Relationships and Money with Jillian Johnsrud
• ChooseFI Episode 186 Multiple Generations Under One Roof With Financial Tortise
• Create a powerful money plan with The One Hour Millionaire Course and get $30 off with the code “ChooseFI30”.
• All-Star Money’s All-Star Originals

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Money is one of the top three things people struggle to communicate with, falling right below sex and above our reasons and motivations for work.
• In her coaching practice, Jillian finds clients will be very open in one-on-one sessions, but when working with couples, it becomes much more uncomfortable.
• Jillian believes this discomfort is because discussions of things like sex and money happened behind closed doors and weren’t modeled for us growing up.
• In response to a call put out for questions in Brad’s FI Weekly newsletter, listeners submitted their questions for Jillian about relationships and money.
• The first comes from Jonesy who had a question about keeping the lines of communication open about money with a significant other when they are at different stages. He is working and beginning to build his portfolio and savings, while his significant other is still in school and struggling to make ends meet.
• Jillian suggests first trying to find common ground to discuss money. You can start with telling your own money stories, like how your parents spent money or what you wish they had spent money on. It’s important to feel seen and heard. Sharing childhood stories are opportunities to start having conversations to begin learning about each other financially.
• Help make the conversation not feel like a trap by being genuinely curious about your partner’s life and experience. You can approach discussions about money much in the same way couples talk about the parenting they witnessed and experienced.
• Pick one or two questions to open up the conversation and put your partner in a relaxed state. Ensure they feel seen and heard before transitioning into conversations on budgets or debt payoff.
• Taking the small step of sharing money stories can help the couple come away with positive feelings, feel closer, and know just a little bit more about each other.
• Jillian and her husband did not communicate about money well during the first few years of their marriage. They had very different money stories and didn’t know how to explain why they were reacting or felt the way they were.
• Breaking the big scary stuff down into bite-sized non-intimidating questions is something Jillian guides users through in her latest workbook, part of which asks us to examine our parents’ patterns, whether or not we have copied or rebelled against them, if what was inherited is serving you well, and do you want to take it forward.
• Because Jonesy and his partner aren’t married, Jillian says it’s okay to skip the specifics in the middle, like savings rates and budgets, and discuss the outcome, like a common goal to work toward together.
• If you work on learning to talk about money, understanding each other financially, and can work toward a common goal, by the time you are on the same page, the middle stuff will be easier.
• Listener Sam wants to know if it can work when one half of a couple is excited about being on the FI path but the other half says FI is not for them. Sam has been on her journey for three years and has a 50% savings rate and plans to retire early, but recently married and her husband’s savings rate is far from the same and he plans on working until 60. They currently keep their finances separate.
• Jillian thinks Sam and her husband could benefit from having conversations about work, its role, and how it ties to identity. It’s feasible for one person to retire while the other works, but it can create a rift unless they understand each other’s stories and mindsets.
• Brad wonders how Sam and her husband keeping their finances separate could work logically in the long-term. Jillian thinks on the surface it cold work so long as they work on everything below the surface and sure each is truly comfortable with the situation.
• Listener Titan wants to know how to make the monthly chart tracking their progress toward FI more fun and exciting for his significant other. Unfortunately, Jillian thinks Titan’s partner will never be excited about it. In any relationship, it seems like there’s one who likes worksheets and graphs and one who prefers to talk about things. She suggests not focusing on the numbers on the graph and instead make it about the amazing life they are creating or whatever is exciting for them.
• Jonathan can sympathize with Titan’s situation but says what were are looking for is trust that you are building an awesome life together and moving forward in the same direction.
• Jillian’s course, One Hour Millionaire, is a 21-day program with the premise that it should only take you one hour a month to set your trajectory to a million-dollar net worth.

• Website:  JillianJohnsrud.com
• Podcast: Everyday Courage

Resources Mentioned In Today’s Conversation

• Download the Stereo app and join us on Tuesdays for the live show!
• Compare home and auto rates from top insurers at Policy Genius.
• Explore Season 2 of Rebel Entrepreneur and make money doing something you love.
• Register for Jillian Johnsrud’s, One Hour Millionaire Course, and get a $30 discount during the month of March with code ChooseFI30.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• We are checking back in with our Households of FI family, Martin and Ayesha, who have been paired with mentors, Julien and Kiersten of Rich and Regular.
• Kiersten and Julien live in Atlanta and started working toward FIRE before they married five to six years ago and have paid off $200,o00 in debt, including their mortgage. They now share their journey on their blog rich & REGULAR.
• Ayesha and Martin live in Chicago and found ChooseFI in January 2020 and jumped in with both feet. Martin is a natural saver and had been a positive financial influence on Ayesha before finding FI so they had done a decent job managing their money.
• Martin was researching dividend investing after it was recommended by Ayesha's uncle who retired at 55. Ayesha felt like her aunt and uncle had the most fabulous retirement life she'd ever seen. Thanks to his example over the last 25 years, their goal is to get to where he is.
• Julien had a similar retirement role model in his life. A close family friend was a Registered Nurse who retried early and showed him that there is a lot of life left after 40.
• Since finding FI, and partly thanks to Covid, Martin and Ayesha's savings rate has increased. It has made them aware of all the frivolous, non-essential ways they spent money before.
• Ayesha hates budgets and doesn't want to track every penny of her spending. She was out of work for four months during Covid and they found that they didn't miss her income and it showed them that they could save a good amount of money without feeling constrained or deprived.
• Having a quantifiable goal and a clear target has helped provide clarity in what they are trying to accomplish.
• Martin enjoys trying to optimize their spending and counting the dollars they save. When they decided to get a new television, he used Offer Up to do his research and purchased a flat-screen plasma HDTV for $40.
• Julien used to track every single expense and look for new savings opportunities each quarter. But now, optimizing their spending has become such a deeply ingrained habit that he no longer feels the need to look at their budget. He says it becomes like muscle memory once you sort out your own system.
• Ayesha feels like when you can simplify your life and have good habits, your life can smoothly and asked what Julien and Kiersten's top habits are.
• Kiersten says doing laundry regularly keeps them from having a ton of extra clothes. She and their son have a capsule wardrobe with 20-30 pieces of matching items. She also keeps the kitchen sink clear of dishes to cut down on kitchen accessories.
• Julien says they have just the right amount of things they need and notes that there is stress associated with the quantity and clutter in our lives.
• Having too many things adds to decision anxiety and analysis paralysis. Instead, whether it is life or a financial strategy, find a handful of things you can nail every single time and ignore everything else.
• Julien also says that he has never made an investment in himself that hasn't paid off handsomely, no matter if it is exercise equipment, a book, or a course. Don't allow frugality to prevent you from paying to learn new learning opportunities. New skills can improve your ability to earn more income or make you more marketable.
• Kiersten likes to save receipts. if the item she purchased sits for several days, she didn't need it and will return it. She also purges the house of items regularly.
• As far as community goes, Ayesha and Martin are doing okay. In addition to family, they have a group of friends who meet to share ideas on investing and becoming financially free. However, they aren't as familiar with the concept of FI so Ayesha feels like they don't have a like-minded community
• Julien notes that, especially for black people, the pursuit of financial independence can be a very lonely experience. Telling people about FI doesn't work. You have to show them, like when you get to the point where you can take a two-week vacation or a month off from work.
• Kiersten and Julien suggest focusing on influencing the next generation. They use their freedom to step up and help out and pick up the slack with their friends' children.
• When it comes to building community, stay open-minded. It takes time to find your best friends and others whose values closely align with yours, but you don't need to divorce yourself from your social circle.
• Like their budget, Julien doesn't check his investment portfolio very often because they won't be touching that money for 10-20 years. His attention is better spent on building the business and maintaining a healthy lifestyle. They make decisions on where to invest income every quarter.
• You can see the crash coming on other people's lives despite the advice you may have given. Still, Julien says to leave the gate open and don't be judgemental. You may not have been the right messenger for that message.
• Before starting rich and REGULAR, Julien was working for a company he loved but was underpaid. When his company paid an influencer $10,000 for posting a photo on Instagram, it motivated him to start earning income in other ways.
• Since they already had rental real estate, he was confident he could earn more outside of work. He was eventual led into the world of digital entrepreneurship.
• When Kiersten was finally comfortable enough to leave her job, they were not yet at FI, but a year's worth of runway that enabled her to quit and devote that time to building the blog.
• The FI community often talks about what number is needed to hit FI, but that number is arbitrary. A single dip in the stock market can impact the number. Julien and Kiersten ask if you were counting on drawing down that money, what would you do for money now?
• Most people only earn income one way, through earned income. They don't know enjoy the quality of that income over any other.
• Kiersten and Julien attend FI meetups in Atlanta and other places and encourage Martin and Ayesha to do the same when they are able.
• Julien had challenges at the beginning of his journey. He grew up poor and was judgemental about his beliefs on spending. He found virtue in saving and said hurtful things to Kiersten because he felt she was spoiled. He's since learned leading with shame creates barriers.
• Whether a natural saver or a natural spender, everybody is spending. Spending today can be rewarding and motivating.
• Kiersten was also judgemental in a different way. She thought she knew how her life was going to be and was closed-minded. She struggled with seeing a different version of herself. She had to be open and let go of her ideas of what certain aspects of her life would look like.
• If they came into a windfall of money and weren't allowed to invest in themselves or their business, they would invest the money in low-cost index funds and then let it grow and forget about it.
• Discipline equals freedom. When you set up a framework for life by setting up non-negotiable things, it allows you the freedom to spend time doing the things you'd rather be doing.
• Brad agreed with Julien's sentiment about investing in yourself and that the spirit of frugality can get in the way of that. Watch out for it.
• The local groups are the heartbeat of the FI community. They aren't made up of podcasters and bloggers. They are regular people who are getting together and trying to live better lives.

• Website:  rich and REGULAR
• YouTube: Money on the Table

Resources Mentioned In Today's Conversation

• ChooseFI Episode 224 Introducing our Households of FI Part 2
• ChooseFI Episode 251 Brad Connects with Martin and Ayesha
• Find your local group at ChooseFI.com/local.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

What You'll Get Out Of Today's Show

• If you are willing to look outside your comfort zone, grab good information, and take action on it, you can change your life in a matter of weeks or months.
• One of the hardest-hit industries during the pandemic has been hospitality. Working in that industry, Anita was looking down a long dark tunnel before stumbling upon the FI community.
• When Anita found ChooseFI in August, she jumped right in, taking action and interacting with Brad through the FI Weekly and submitting her frugal wins of the week.
• By listening to the podcast, Anita heard about Jonathan starting up the Talent Stacker podcast and the program he put together with Bradley Rice on Salesforce career development. Anita gave it a shot and her results blew Jonathan and Bradley's mind.
• The results Anita has had are not an outlier. It's what others are also seeing every single week.
• Back in the spring of 2019, Bradley was on the show to talk about Salesforce and living a life by design. After Bradley discussed earning $200K a year working 15-20 hours a week, the listening audience really responded.
• Based on that interest, a Salesforce group was started for the community and people began landing Salesforce jobs. In just two years, the group grew to 5,000 members learning from each other.
• A year ago, Anita was working as a revenue manager for a hotel connected to a convention center. At that time, the pandemic was accelerating and group after group began canceling their events. As a result, she was furloughed in March.
• Understanding that hospitality wasn't going to recover anytime soon, Anita decided to be proactive, began learning, and figuring out what her next move would be.
• In addition to taking classes online, Anita researched Fortune's top places to work. The first time she heard of Salesforce was from that list but was turned off at the thought of sales. After a little research, she discovered sales isn't what they do.
• She signed up for Trailhead, Salesforces's online learning account, and did it for one day before concluding it was awesome. But she wondered it was real and if was as easy as it seemed.
• After receiving more bad news from her employer, Anita was motivated to learn more. She found ChooseFI and binge listened to over a hundred episodes when she heard about Talent Stacker, Salesforce (again), and the free 5-Day Challenge.
• She ended up in the paid program and because she had been laid off, she used her time to learn everything she could like it was her full-time job.
• One month after starting the program, she took the first admin certification program and passed. After that, she used all of the tips from the program and landed a good-paying job in January.
• Prior to the pandemic, Anita was in a financially stable place. She had no debt other than a car payment, although after being laid off she was forced to move in with her boyfriend.
• She says in her previous hospitality job, she was on a path to get o the kind of pay she is earning now, it just would have taken a lot longer.
• Bradley says what Anita has done is possible because cloud-based technology is less-impacted by things like the pandemic because they are skilled positions, are able to be done remotely, and without a lot of change management.
• There aren't enough skilled Salesforce professionals to fill all the available positions. To help fill the gaps, Salesforce developed Trailhead, a free online training app, which removed some of the barriers to entry.
• Being able to study inline for a few months and then land a $60-80K per year job sounded too good to be true. This is one of those occasions when something that sounds too good to be true really is true.
• If you don't have basic computer skills, a Salesforce career may not be for you. However, if you like the thought of helping companies generate new leads and support new customers, it might be a good fit.
• There's so much information on Salesforce that it can seem overwhelming. Anita explains that she is reorganizing the business to help companies become more efficient.
• A Salesforce professional helps a company use the software to find more customers, sell to those customers, retain the customers, and secure the customer's data.
• The majority of individuals can come away from training earning $60-80K a year. Anita surpassed that when her first offer was six figures and she doubled her previous salary.
• Bradley says the career trajectory quickly increases from there. Even someone who isn't leaning in will likely reach six figures after three years and top out around $130K with $20-30K bonuses.
• The more entrepreneurial-minded can strike out and become independent consultants and earn even more. Bradley makes $200K a year working just 20 hours a week.
• Based on his return on investment, Jonathan wouldn't go to college if this program was available to him. He spent eight years in school and came away with $168K in debt, rather than six months of training for a couple of thousand dollars. His net worth would be two to three times higher if he had.
• That doesn't imply ChooseFI is anti-college. Rather, the takeaway is to think differently, look at the world for how it is, and see opportunities. The traditional path may not be for you.
• Taking a hybrid approach can be a benefit. Go ahead and go to college, but spend a summer in a Salesforce career development program. It helps you understand what Salesforce is, gets you halfway through a program, and helps you to decide if it's right for you.
• You can do this for free. Fraining is available on Trailhead. What the free Salesforce 5-Day Challenge does is show you how to get started in Trailhead and show you a clear path, and help you decide if Salesforce is for you in just 30 minutes a day.
• Anita chose to go through the paid portion of the course because of the clear path it offered.
• Announcing the introduction of a new live interactive component to the show! In an experiment over the next ten weeks, we'll be testing it every Tuesday night at 7:30 Eastern, starting February 23rd.
• Using an app called Stereo, we'll go live with voicemails and questions every Tuesday. Access the event at ChooseFI.com/live.

Resources Mentioned In Today's Conversation

• Take part in the Tuesday live events at ChooseFI.com/live.
• ChooseFI Episode 117 Making the Case for Part Time with Bradley Rice
• Check out the free five-day Salesforce challenge.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• This Friday's episode continues with the theme of looking back at how our perspective has changed since the show began. What has changed, have we pivoted, and what do we feel more confident about now than we did then?
• Last Friday Brad shared the saga of trying to find out how much a CT scan was going to cost him. In response to the story, members of the community reached out with their ideas for saving on the cost.
• One listener shared a link for MDsave.com, a company that contracts with different healthcare providers to provide very specific pricing for a number of healthcare-related services and procedures that you pay in advance for.
• Using the CPT code for his procedure, Brad discovered there were no providers in his area, but there was a good number in Charlottesville about an hour away. Had he used this website, he could have paid under $300 for his CT scan. Without using it, his insurance company was billed $2,083.
• For prescription drug needs, there is a similar website called GoodRX.com
• The healthcare system is broken. Price transparency in healthcare, like both of these websites offer, cuts the middleman out and lowers costs.
• Jonathan suspects that anytime you are using these apps you are sacrificing some privacy.
• If you have a high-deductible plan and rarely if ever reach it, you may be better with the discount as you cannot double-dip and need to choose whether you go through the app/discount card or your insurance company. However, prescriptions do qualify as HSA reimbursable expenses.
• Emergency funds are a part of every financial plan, with most stating a fully funded fund contains three to six months' worth of expenses.
• ChooseFI has pushed back a little on the standard emergency fund concept, asking if you really need one, what does it need to look like, and what are we protecting ourselves from?
• Both Brad and Jonathan's perspective on the emergency fund has changed over the years. Most personal finance experts conceptualize it as money sitting around doing nothing waiting for an emergency to occur.
• The further down the path to FI you travel, the role of the emergency fund begins to change. At what point should you stop allowing your emergency fund to lose value from inflation and invest it instead?
• When first starting out, a fully-funded emergency benefit provides psychological benefits. But 1o-15 years down the path to FI, there are very few true emergencies. There is an opportunity cost to your money sitting on the sidelines. Could you have that money invested, earning and growing for you?
• Brad can't think of a scenario where he would need thousands of dollars in cash in a hurry. Even if the unthinkable were to happen, he could pay with a credit card or a check. Worst case scenario is that he would need to access money by selling funds in an investment account and he would have it two to three days later.
• For individuals just starting out and moving away from living paycheck to paycheck, having $1,000 available in cash as a crisis fund makes a lot of sense.
• Brad keeps a couple thousand dollars extra in his checking account just so that he never needs to worry. There is an opportunity cost, but he finds it worth the peace of mind.
• Jonathan tries to keep as little in cash around as possible. He has one or two months' worth of expenses in cash. Because he knows his monthly expenses, when he gets paid, he's able to save first, get it invested, and live off the remainder.
• Interest rates on bank accounts are so low that there's no incentive to keep it there. Inflation alone erodes the value of money by an average of 3% per year. Is there a way to hedge against inflation while still meeting a need for liquidity?
• Beginners may need to keep their money sitting in a savings account to feel comfortable. Once you get to the point where you can put money away and realize you aren't going to touch it for 30-50 years no matter how the market fluctuates, start investing.
• March 2020 was without a doubt, a black swan event. Was an emergency fund a factor for you? Did you think about its value more at that time than previously?
• Brad certainly felt better knowing he could rely on the cash from his net worth if it was needed.
• Events of the last year had Jonathan thinking more about his net worth acting as a store of value. In a changing landscape, he wants to use the assets at his disposal to make sure he is more valuable.
• He doesn't see cash as a great store of value. Due to inflation, cash is depreciating. When it is invested in the market, it produces value and increases with inflation.
• As a store of value, bonds can provide stability, a regular income, and a negative correlation.
• Cryptocurrencies, such as Bitcoin, are another store of value, although due to its volatility, it feels very speculative.
• Precious metals, like gold and silver, are yet another store of value that can be owned physically or as paper assets through ETFs. However, with precious metal ETFs, not all are structured where every share is backed with the precious metal.
• For Jonathan, the ideal store of value is a conservative emergency fund that beats inflation and if the worst happens, there's an upshot for him where he hasn't lost his store of value, and finally that it has liquidity.
• A margin loan from M1 Finance gives Jonathan access to a very low-interest loan with stability, liquidity, and plenty of upshot.
• Brad's ideal store of value is a business that is producing some type of income, like a diversified rental real estate portfolio.
• For your emergency fund, you want to preserve its value, but its store of value all comes down to what you are comfortable with. It's worth analyzing the role of your emergency fund at its particular point on your path to financial independence.

Resources Mentioned In Today's Conversation

• MDSave.com
• GoodRX.com
• ChooseFI Episode 291 If I Could Turn Back Time
• ChooseFI Episode 066 The Emergency Fund…Is it a Bad Idea? with Big Ern
• ChooseFI Episode 194 The Role of Bonds in a Portfolio
• The Infinite Game by Simon Sinek
• ChooseFI Episode 115R How to Get Out of Debt
• Get started on your journey to financial independence at ChooseFI.com/start.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Amanda Holden's approach to educating others includes laughter and shenanigans to democratize information and get it to stick.
• Amanda worked in corporate America at an investment management firm, but helping rich men get richer wasn't her calling. She hated the job and decided to establish a set of rules that we allow her to quit in six months and go travel.
• She chose to supplement her bare-bones spending by living off the excess of others. That including asking for leftover uneaten lunches which earned her the nickname, Dumpster Dog.
• Pulling burritos out of the trash and drastically cutting her spending worked. Amanda's savings enabled her to leave the job she hated and travel for a year.
• Dumpster Doggy has now become her identity, showing others how they can make it work even if they don't have a lot.
• Being privileged enough to live in one of the wealthiest countries in the world also means that we take it for granted and are surrounded by vast amounts of waste. Are we throwing so much away that we are sabotaging our chance to get what we really want?
• While each day she felt like she was trying just keep putting one foot in front of the other, at the time, she didn't think of it the changes she was making to leave a toxic work environment as a metamorphosis.
• She hated the job so much that she felt like the only option was to quit and start over from zero. Hating it that much allowed her to take a risk on doing something that aligned better with who she wanted to be and what she wanted to do.
• Her advice to anyone who doesn't dislike what they are doing quite as much as she did is to start saving and doing what they want to do on the side. Then assess once there is momentum to decide if you want to take it further.
• Amanda acknowledges that she was privileged with a level of comfort and security when taking her leap as she had a family to fall back on for help if needed.
• She isn't trying to sell entrepreneurship to everyone. It makes sense for some people but there are aspects of it that she doesn't love. It won't be the right fit for everybody.
• What worked for Amanda was starting by giving her service away for free and collecting as much feedback as she could. While she has the blog, For her business, she started out cold calling on sororities. She asked to come in to teach them about investing and then collecting their feedback.
• After building this foundation, she began to explore what the sticking points were for people and how she could begin to charge for her services.
• Amanda says it's all about connections, so utilize your network to get your information into the hands of whoever can help get you in the door.
• Amanda wants women to be in the conversation because when they have a seat at the table, they have wealth and the world is a better place.
• To reach women and make the material accessible, Amanda avoids jargon and uses comedy as an educational tool. For instance, she leads with equating a 401K or a Roth IRA with a Caboodle, which is just a fancy place for you to store your treasures.
• Amanda also uses a shame-free approach to money. Women are constantly feeling shamed about money, whether it's for making too much or too little, or for how they choose to spend it. She trusts you to be grown up enough to make spending decisions for yourself.
• Everyone deserves to be able to spend a little bit of money on themselves and have some fun. Living paycheck to paycheck might be a problem of spending too much or it might be not earning enough. Saving and investing can be automated if spending is the problem, while a conversation about earning might be warranted if income is the problem.
• In addition to removing the shame associated with money, Amanda says you don't have to be perfect. She uses her own mistake stories to help bring people in.
• While building her business, Amanda worked as a bartender and freelance writer. She still freelances for the regular income but she also puts on personal events that are more fun than the corporate speaking events where she feels muzzled.
• Amanda was teaching investing courses on Zoom well before Zoom became a thing. She's been able to scale the course by putting it on video.
• The first thing she tells people is that investing is absolutely in their capacity and that if you take a set it and forget it approach, you'll probably do better than the investing experts.
• Course information can be found on her Instagram page. If interested in contacting her for a speaking event, reach out to her on Instagram or by email.

• Website:  Invested Development
• Website: The Dumpster Dog Blog
• Instagram: Dumpster.doggy
• Email: AmandaHoldenInvesting@gmail.com

Resources Mentioned In Today's Conversation

• Start your 60-day free trial with LinkedIn Sales Navigator today.
• Switch to Mint Mobile and save.
• Get started on your own journey to financial independence at ChooseFI.com/start.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• M1 Finance transformed Jonathan's ideas about how simple complexity could be and has quickly become his favorite investing platform, especially for taxable accounts.
• Brian Barnes investing story begins at the age of 10 when his parents exposed him to trading stock in a brokerage account with Ameritrade. He was captivated by the notion of investing and the intellectual puzzle of how a company was doing.
• His parents laid a general foundation of financial independence and security. Once basics were covered, they placed value on putting money someplace where it could accrue value, compound, and become ownership is something valuable.
• Getting started at the tail end of the Dot Com bust, it was a great time to be buying when prices were low and companies were valued cheaply.
• Brian says there is a big difference between traders and investors. Traders speculate on price and try to make money on short-term movements. Investors buy ownership in companies, asset classes, or industries to accrue value over long periods of time.
• When you aren't making frequent investment decisions, it becomes more about viewing your portfolio in totality and making a decision on what to do with the extra money you have leftover from your paycheck.
• In the trading world, you have to go in and make the same decisions to buy the same securities over and over again, but with M1, you can make the decision once and let the software automate the process.
• With day trading, you can't just be right once, you need to be right over and over and over again, constantly timing the market perfectly. It's difficult to predict costs even when commissions are free and it's tax-inefficient.
• With an investing mindset, you want to own over long periods to accrue value and generate cash flows.
• At the age of 25, Brian realized investing platforms hadn't changed in 15 years. He looked at consumer applications work that sought to make things simpler, more intuitive, and automated wondering why there hadn't been progress in the financial services world.
• He thought it would be nice if he could tell a software platform the portfolio he wanted to own, and anytime he had money, he could throw it into the platform and it just went to work. He wanted to deploy all of the money by purchasing fractional shares so there wasn't any cash drag. And finally, incredibly low fees with no commissions.
• As M1 has expanded, it's grown from his “wouldn't it be nice” idea to other areas like borrowing and spending, allowing users to have one financial institution instead of needing to use multiple apps.
• M1's philosophy is that a great product allows you to do complex things simply. What they allow customers to do is determine what share of their portfolio they want in any given investment and then the software handles the complex and mundane administrative work.
• It used to be that you had to buy lots of 100 shares. It was a big step forward to be able to purchase odd lots of shares.
• Being able to purchase fractional shares with M1 is transformational. They do this by purchasing in whole shares and adding the leftover fractions to their own inventory account. It makes it easier for the customer to deploy more money consistently and have a diversified portfolio.
• M1 is a commission-free platform. Traditional brokerages made 10-35% of their money from commissions. Through technology development, the cost to trade is only an electronic message. Though not free, on a per-transaction basis, it can be no-cost to the user.
• M1 can make money monetizing the assets held on their platform so by being efficient, they don't need to charge transaction fees, making it a win-win arrangement.
• M1 is not good for day traders. It's suited for systematic investing in the portfolio of your choosing. Their trade windows occur twice a day and aggregate all orders on behalf of their customers once in the morning and once in the afternoon.
• While you can invest money every day through M1, a good financial habit to establish is to invest the extra cash you have leftover from your paycheck every two weeks. M1 allows for that to be automated.
• Portfolio management in M1 orients itself around a pie concept. At the highest level, the pie is 100% of your portfolio. You can then begin to divide up the pie into slices based on what percentage of your portfolio you want in specific investments. The slices can then become their own pies. It allows for a diversified portfolio, controlling risk exposure, without the risk of becoming overconcentrated.
• In M1 you can rebalance your portfolio in the next trading window with the one-click button although that method is tax-inefficient. Instead, additional contributions will automatically work to rebalance your portfolio with your pies without causing taxable events.
• With investing, taxes are going to be your biggest fees. Minimizing taxes controls costs and maximizes long-term success. With M1's dynamic rebalancing, it tries to minimize the sale of securities with tax consequences to push taxes out as far as possible and let your money have more time to compound.
• Brian is a fan of Vanguard and what they have to prioritize the individual investor. The difference between M1 and Vanguard is that you can buy Vanguard ETFs with M1, but Vanguard has a mediocre brokerage to buy other securities.
• Compared to Vanguard, M1 offers a more robust and comprehensive personal financial platform, such as a line of credit against your securities with rates as low as 2%. M1 also has a high-yield checking account earning 1% plus 1% on debit card purchases. The smart transfer tool allows you to set parameters and have money automatically move in and out of accounts accordingly.
• M1 wants to be a personal finance platform where you can manage your money holistically.
• They just launched custodial accounts which are available with the M1 Plus membership for $125 a year which has additional benefits across Invest, Borrow, and Spend. M1 is offering a promotion to get one year of M1 Plus for free.
• In the last few weeks, ChooseFI CEO Ed has been migrating assets from other platforms to M1. While Brad already has an M1 account, this conversation with Brian has helped him realize what he has been missing out on.
• Jonathan wanted to note that with the smart transfer rules, the decumulation phase can now be as easy as the accumulation phase.
• Previously, Jonathan was going to get a HELOC. When he stumbled upon M1 Borrow, he realized that it was a margin loan much in the same way that a HELOC is a loan against your home. Borrow can be a liquidity tool, giving you access to 30% of your investments as an emergency fund. It gives you an incentive to build an emergency fund and keep it invested.
• Brian says you should be able to have a line of credit against a liquid investment portfolio at really low-interest rates.
• The goal for M1 Finance as the finance super app is for people to come to M1 to manage their finances, not a component of their money, as well as provide the same level of capability that a high-price team optimizing every aspect of your finances could in a self-serve product.
• You won't find VTSAX on M1. VTSAX is a mutual fund and M1 does not have mutual funds. What it does have are ETFs which are identical versions of mutual funds. VTI is the ETF version of VTSAX on the M1 platform. M1 also has Paul Merriman pies for anyone interested in his ultimate buy and hold portfolio.
• For those in the decumulation phase, M1 has IRAs, taxable accounts, and 401Ks that may be rollover into IRAs which can be set up as smart accounts using dynamic rebalancing and withdraw money in the most tax-efficient manner possible.

Resources Mentioned In Today's Conversation

• M1 Finance-Completely Free Automated Investing!

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Does your portfolio own enough of the companies that carry a lot of the growth over extended periods of time? When you buy index funds, you aren't as diversified as you think you are.
• Cap weighted index funds mean you are buying a lot of the companies that are doing really well. But there are two asset classes Paul Merriman is a fan of that he thinks don't get enough attention, small cap and value.
• Although many people claim to believe in a buy and hold strategy with investing, their behavior says otherwise. They like to buy when things are hot because they believe it's going to keep going up.
• If you look back as far as 1928, a lot of the time the S&P 500 is walloping small cap value returns, yet at the end of this 92 year period, small cap value made 24 times the amount of money the S&P 500 did.
• Even though there are long periods of underperformance, when small cap value does take off, there is outstanding performance. Then when it reverts back to the mean, there is a higher compound rate of return.
• Owning a large cap fund means each holding in that portfolio, and how much of the portfolio it represents is based on how large that company is. The big companies represent 80-85% of the corporate public value in our economy.
• However, history shows that the smaller companies and the value companies produce a better rate of return because they are more risky.
• It doesn't have to be a lot to make a big difference. If you were put 10% in a small cap value fund, it would give you a legitimate shot at having 20-30% more money when you retire.
• The top 20 companies probably make up 20-30% of the money you have invested. Investing in an S&P 500 or total stock market fund provides an illusion of diversity. As companies get to be bigger in size, it becomes increasingly more difficult to double or triple in size.
• Companies are valued by the number of shares times the price in the market.
• Large cap index fund companies average a market capitalization value from $50 billion to $150 billion.
• Small cap companies are roughly 1/50th the size of the big companies with values averaging $2 billion. They are legitimate companies, but many of them will fail.
• Since 1928, the S&P 500 or total stock market compound rate of return has averaged 10%. However, research has shown that only 4% of those public companies made virtually all of that 10%, while 96% of companies averaged just 3%.
• As an aggregate, small companies are much more likely to double or triple in size.
• Value companies can be seen as companies that are out of favor and years later, they may still be out of favor. Academics don't advise buying value companies one at a time.
• People come into value companies to make them more meaningful, profitable, and efficient turning those companies around.
• The problem with great companies with a great future is that when something happens to pop the ballon, those companies can fall 25% in a day, similar to what happened with the Dot-com bubble in 2000.
• Telsa, for instance, is a car company on the verge of bankruptcy several years ago and now it's up 400% even though it is barely turning a profit. With a current share price of $800, it's going to take a lot to double your money, yet people still believe in Tesla.
• Paul wants to help people figure out how to invest in an unemotional way and don't get caught up believing in something that isn't likely to happen.
• Last year, growth companies were up 35-40%, however, looking back at 90 years of evidence, growth produced a lower rate of return than value by 2% a year.
• Paul's latest book, We're Talking Millions!, is all about the extra half of 1%. For every half of 1% you can make on your portfolio over a lifetime, you add a million dollars. Finding more of those half of 1% and adding them up is a lot sexier than finding the hottest thing in the market.
• In his book, Paul lays out 12 simple ways to capture those half 1% that the market is ignoring.
• Paul's been hearing complaints for years that his work has been too complex. It's was something his firm did for his clients, but most individuals do not want to make it that complex.
• Someone in their twenties, investing just $5,000 a year for 40 years, can use these strategies to make millions over an investing lifetime.
• It's not all because you took more risk, it's also how you protect your money from others getting their hands on it, like money managers.
• Choosing to save can be a million decision, and choosing to save early can be another million.
• In one mind-blowing statistic, Paul says 25% of millennials will not put money in the stock market.
• The ultimate buy and hold portfolio might be difficult to replicate inside a 401K. To make things more simplified, Chris Pedersen developed a system to implement the philosophy with roughly 98% of the benefits.
• The goal is to keep it as simple as possible so that anyone can do it and won't need to manage it other than for a few minutes a year.
• One way to buy a target date fund. But because they don't have enough value or small cap companies represented, have 90% of contributions go to the target date fund and 10% to a small cap value fund. The target date fund is broadly diversified and automatically adjusts to become more conservative as you age.
• Chris said the problem is young people should have more invested in small cap value and came up with a formula for calculating just how much, which is 1.5 times your age into a target fund and the remainder in small cap value.
• For example, a 30-year-old should multiply 30 years x 1.5 to get 45% in a target date fund and 55% in small cap value.
• Paul and Chris encourage continuing to hold 10% in small cap value at the age of 60 and beyond which is good during the 30 or more years in retirement.
• Not all target date funds are created equal. Look for one that is low cost and contains total stock market funds.
• Jonathan doesn't like having bonds in his portfolio and notes that target date funds have bonds in them. Paul agrees and said he spoke with John Bogle about it once. He was told that bonds are defensive and do good when the rest of the portfolio is down 50%.
• You can reduce your exposure to bonds in target date funds by adding equities to your portfolio.
• With target date funds, the year indicates how aggressive it is.
• As with a traditional portfolio, rebalancing your portfolio is a part of the small cap value strategy. If you want to be true to your strategy, you need to sell some winners and buy some of the losers.
• Jonathan has modeled one of the Ultimate Buy and Hold Portfolio pies Paul has on his website in his taxable brokerage account with M1.
• Paul says it's never been easier or efficient to invest. Even if the market does return as much as in the past, you can probably make the same return because it used to cost so much to do before.
• They are coming out with all new recommendations for best-in-class ETFs. Paul has all his buy and hold funds in DFA dimensional funds and now anyone will be able to buy DFA funds through DFA or Avantis without paying a commission. Since it's an ETF, you can buy commission-free with M1.
• Pauls' book is free for teachers and students, just email Paul at Paul@paulmerriman.com to get the PDF by email. The book is also available on Amazon. If you can't afford the $14.95 price tag, email Paul for the PDF.

Resources Mentioned In Today's Conversation

• ChooseFI Episode 130 Paul Merriman Introduces the Ultimate Buy and Hold Portfolio
• We're Talking Millions!: 12 Simple Ways to Supercharge Your Retirement by Paul Merriman
• M1 Finance Review – Completely Free Automated Investing!

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• For almost 12 months, we've all been trying to do the best that we can. As frequently discussed on the show, we try to do things slightly different, optimize in the ways that we can, and make the best of the situation.
• Jonathan's wife Dani has been coming up with all kinds of creative little activities for the kids. Even Jonathan was recruited for a rock painting project.
• Brad has been listening to a new podcast, Ordinary Sherpa, created by Heidi, a member of Jonathan's Talent Stacker podcast. The podcast is about creating little adventures in life with your family.
• At the same time, in the mastermind group Brad takes part in, he was inspired by a discussion related to dads really showing up to be a part of their kids' lives.
• The podcast theme and mastermind group discussion converged for Brad when his daughter, Molly, asked him to go explore the creek with her. Rather than playing along for a minimally acceptable amount of time, Brad showed up like he really wanted to be there and they had hours of fun exploring together.
• What if you started to show up for everything in your life with the attitude that you really wanted to be there?
• It's difficult to be focused on growth in all areas of your life at the same time. There are different seasons when you will be able to lean into one over another but it's good to figure out a baseline you're comfortable with and recognize when it's time to rebalance.
• Since Brad's financial life is on autopilot, it's not something he spends much time focusing on. However, sometimes things do backslide and he needs to return a little focus to it. Such as, he recently canceled two recurring charges for streaming services, not because their costs were going to have a significant impact, but because he was no longer getting value from them.
• Relationships is an area Brad believes he could spend more time focusing on. If he were to ask himself, “Am I showing up as the best version of myself for my wife and kids every day?” his answer would be “no”.
• Who should be leaning into and leveraging their Roth 401K? Sean Mullaney, The FI Tax Guy, says the Roth 401K works similar to a 401K except the funds going in are taxable today and come out later tax and penalty-free.
• Those currently in a high tax bracket looking to retire early are probably better off contributing to a traditional 401K. But someone just out of college in a 10% federal tax bracket may benefit from paying 10% in taxes today rather than 20-30% later on. Even someone who may have substantial taxable income in retirement may benefit from a Roth 401K.
• A Roth 401K can also be a hedge against future tax rates for anyone who prefers to lock in their tax rate today.
• If your 401K plan offers it, you don't have to do all Roth 401K or traditional 401K. You can split the difference.
• For example, a 60-year-old new retiree with a large 401K will be taxed on every dollar withdrawn. We don't know what future tax rates will be.
• Roth 401K withdrawals don't work the same way as traditional 401K withdrawals. You can structure it in a way that you can recover tax-free contributions, From a Roth 401K, you may need to rollover into a Roth IRA.
• For the early retirees who don't plan to retire at a super early age or anyone with artificially low income for a few years, the Roth 401K is a strategy to consider.
• If you aren't 59 1/2 yet, Roth 401K withdrawals are subject to the cream in the coffee rule where 2/3 of the withdrawal is tax and penalty-free but 1/3 is subject to ordinary income tax and a penalty. This is different than a Roth IRA where contributions may be withdrawn at any age tax and penalty-free.
• When you roll over a Roth 401K to a Roth IRA, the Roth 401K contributions go in as Roth IRA contributions, and earnings become Roth IRA earnings. You could then take out the full amount of contributions tax and penalty-free before touching the earnings.
• If you aren't 59 1/2 and need to access your Roth 401 contributions, it makes sense to roll them over to a Roth IRA first.
• If you have employer stock in your 401K, there may be net unrealized appreciation. You do not want to roll it over from a traditional 401K to a traditional IRA without considering a tax planning strategy. This requires assistance from a tax professional.
• If you want to do a backdoor Roth IRA, rolling over 401K to a traditional IRA isn't a good idea.
• The fees associated with 401K plans have gotten better over the last 10-15 years. The investment choices are better with lower fees. It may not make sense to do a rollover.
• As a general rule, retirement accounts have required minimum distributions (RMDs) once you turn age 72. The exception is the Roth IRA. While RMDs from a Roth 401K are not taxable, you want to keep that money growing tax-free as long as possible for you and your heirs. If you're 72, Sean would recommend you roll your Roth 401K to a Roth IRA for that reason.
• Generally, you need a separation of service to do rollovers from a Roth 401K to a Roth IRA. Look for your plan's Summary Plan Description (SPD) which details withdrawals.
• 401K plans are subject to the ERISA law, where creditors cannot access the funds, except for ex-spouses and the IRS. IRA creditor protection varies from state to state. Something to consider before a rollover.
• Dani and the ChooseFI Foundation are using meal planning as a financial literacy tool. Always looking for ways to get children interested and thinking bout decision-making and personal finance, they have put together Meal Planning Made Easy.
• The meal planning project helps kids put financial literacy concepts into a real-world contest. The goal is to make financial literacy concepts more than just habits but to have kids take ownership and have fun doing it.
• In the 3rd through 5th-grade video series, Dani talks them through meal planning. They are tasked with going into a grocery store, either in-person or virtually, and planning all three meals for one day.
• The meal planning project is adaptable to fit every socioeconomic setting.
• The tasks grow as children develop. High school students may plan meals for an entire week, searching the pantry first, and finding recipes to help on the budgeting side of things, just like parents have to do.
• Sign up for Meal Planning Made Easy at Choosefi.com/mealplan.

Resources Mentioned In Today's Conversation

• The FI Tax Guy
• Ordinary Sherpa
• Do Inner Work
• Roth 401K Withdrawals
• ChooseFI Foundation
• ChooseFI.com/mealplan
• Get started on your own journey to financial independence at ChooseFI.com/start.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Should you rush to reach FI? Or use it as a map in a lifelong pursuit to master your relationship with time, money, and happiness? Brandon, from the Mad Fientist, wishes he would have found more free time to work on other goals while on his journey to FI.
• When Brandon was first on the show four years ago, he had just reached FI and discussed the psychological hurdles he had to overcome. What's changed for him since then, and with the benefit of hindsight, what would he do differently?
• Brandon's dream as a child was to write music and put it out in the world. However, his musical tastes are not mainstream, so becoming a pop star was never one of his ambitions.
• He did not want to just be a consumer, he wanted to be a creator and always felt that it was his job that was holding him back.
• It wasn't until after reaching FI that he realized it wasn't was what holding him back at all. He had been spending his free time on things like television on travel instead of his music project.
• His problem was psychological. As a math and science guy, he didn't believe he could do it. Trying meant the risk of failure, and if he failed, the dream would be gone. It took Brandon two years to come to grips with and get over that hurdle.
• During his pursuit of financial independence, Brandon has tunnel vision, with all his time and effort devoted to making and saving more so that he could reach FI more quickly. The result was a decrease in his overall happiness.
• He admits that he did it wrong. The whole point is to master the relationship between money, time, and happiness. Mastery is probably better to focus on over goals.
• Goals delay your happiness because you are always looking to the future instead of enjoying the present or the journey.
• Reaching FI for Brandon didn't have an impact on his life other than making him more confident that he could step away from his job.
• Motivating yourself to do something is hard when you don't have any sort of external motivation to do it.
• In 2017, Brandon wanted to do two things: get better at songwriting and get fit.
• The personal trainer he was working with asked him how much he wanted to bench press or how much muscle mass he wanted to put on. Those were goals Brandon didn't care about. With his mastery mindset, he only wanted to get healthy and stay healthy.
• In contrast to getting fit, his specific goal for songwriting was to write a song and share it with his brother. When he finished it, not only was it awful, but the whole process was awful and it caused him to quit pursuing any additional songwriting until he summoned up the courage again in 2019.
• Pursuing mastery may be summed up by asking, “Am I better today than I was yesterday?” Continuing to answer yes is pursuing mastery.
• Brandon found it to be true that doing something consistently changes who you are. He never felt like a musician until he was doing it for 25 hours a week.
• He still feels like his triangle is skewed toward money at the expense of time and happiness so he has been trying to figure out how to use money to get more time or increase happiness.
• For example, he wrote eight songs and wanted to get them to sound as great as possible, so he hired a Grammy award-winning sound mixing engineer to help mix his album. He was able to both learn and make a better final product.
• He doesn't want to waste money but does want to figure out how to use it efficiently and maximize the triangle of money, time, and happiness.
• There's a lot of unconscious spending in society that doesn't really bring happiness either. Getting on the path to FI helps you sort out the equation a bit more.
• We're terrible at knowing what will make us happy. That's where experimenting comes in. Experiment with your spending and your activities. What still feels good a week later versus ended up being meaningless.
• It's okay to spend money sometimes as long as you do it from a place of value. If you are in a deprivation zone, one thing that helped Brandon was to relax for two years with respect to his spending. If it was something he and his wife wanted to do, they did it. At the end of the year, although it felt like they had lived an extravagant life, they spend just $3,000 more than normal.
• In the deprivation zone, you are testing the lower limits. You can test the upper limits and then hopefully find the sweet spot. It's difficult to find where the sweet spot is for you without testing the limits.
• Once you have the bigs things taken care of, the little ones don't seem to matter. Brandon had already limited his large structural recurring expenses. What he had given himself latitude with were the everyday one-off decisions that in aggregate, turn out to barely move the needle of his finances.
• Brad and his family have anchored themselves to a $2 per person per meal per day rule. It helps them to apply intentionality to their meal planning. He thinks it's better to try and optimize and then dial it back if gets to be a little too much than continue to go through life being unaware.
• Brandon is an introvert, so announcing publicly that he is releasing his first album is a big deal.
• Back when he wasn't making progress because he wasn't putting the time in, he talked his brother into going to a park and playing a show. The thought of doing it was scary, but he already knew what it was like not to it. He wanted to know what the world would be like if he did do it.
• While playing in the park, a man slipped Brandon his email address. It turned out he source talent for a music festival in Scotland and asked if they wanted to play at it.
• Brandon taking that chance in the park reminded Brad of a quote by Scott Young, “Your deepest moments of happiness don't come from doing easy things. They come from realizing your potential and overcoming your limiting beliefs about yourself”.
• Both financial independence and the pursuit of financial independence allow you to begin building armor. Failure is good. You have to be bad at something before you are good at it.
• FI definitely helped Brandon build his armor. He didn't have anyone to answer to or worry about stumbling across what he was doing.
• He also uses an alter ego for his work in the financial space, as well as another for his music.
• Something that Brand did to progress with his music was conduct an ultralearning experiment. He took three months where he blocked out all other activities competing for this attention to do the thing that he wanted to do, which was write songs.
• He committed to devoting 25 hours a week and built spreadsheets of prioritized tasks. He says it is the only reason he succeeded. He focused on the hours and the effort and then by-product comes out of it.
• For others just trying to get started learning, Brandon thinks copying what you love is a great place to start. Your unique set of influences is enough to make what you do unique.
• The unique skills each of them possess is what lead to this very podcast. Brad being a CPA with a travel rewards website is what got him a guest spot on Brandon's podcast. Then Jonathan heard the podcast and discovered both Brad and he lived in Richmond, which lead him to first contact Brad.
• Every good idea comes out of a bad idea, or an okay idea, or even a mediocre idea. You do not need to get it right the first time. The fact that you are willing to try gives you the opportunity to get feedback and iterate into something amazing.
• Brandon's album is available for just $5! You can pre-order your copy at ChooseFI.com/album.

Resources Mentioned In Today's Conversation

• ChooseFI Episode 017 Mad Fientist and Origin Story
• James Clear “Forget About Setting Goals. Focus on This Instead.“
• Ultralearning: Master Hard Skills, Outsmart the Competition, and Accelerate Your Career by Scott Young

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Are you the kind of person who sets New Year's resolutions? Like many Americans, Jonathan used to set weight loss goals for the new year, but not this year. Instead, he and his accountability partner, JD Roth, spent the previous nine months working on it and began the year, at or very close to their goal weight.
• Not having to work on big weight loss goals is allowing Jonathan to be aware and focus on testing smaller adjustments that will make him feel better and have more energy.
• Brad once had an experience while on vacation that made him realize how his normal diet was causing him joint pain. He wasn't even aware he had joint pain until one day it was gone. It was only then that he understood he had a problem that needed to be worked on.
• When you live an examined life, you don't have to accept the things that are reducing your capacity to function as normal.
• Brad thought his morning smoothies were a healthy choice, but it turns out the negative impact was a sugar crash necessitating an afternoon nap. It wasn't something he noticed until he stopped the daily smoothie routine.
• The examined life concept can be applied to your personal finance life as well. It's not as much a goal as it is a mastery of process.
• Brad embraces James Clear's concept of setting up systems that work in his life versus setting goals. He has set up eight different things he wants to accomplish as a part of a system with checkpoints along the way.
• In an attempt to develop two new habits, Brad is habit stacking. With habit stacking, you take one habit you have and combine it with another you want to create. Brad has combined his desire to become more fluent in Japanese with moving more during the day by taking walks around the neighborhood while listening to the Pimsleur language learning app. It's not perfect, but it's a system that is working for him.
• Brad is also following the advice of Chris Guillebeau and conducting his own annual review. This annual review sets the big picture, the intentions, the purpose, and outcomes. It then breaks life down into different areas where concrete goals may be set, such as self, health, family, community, travel, and others.
• While neither has large plots of land in suburban Richmond, VA, Jonathan and Brad have both contemplated starting some sort of micro garden.
• Listener James wrote in to say that he's been able to cut down on his grocery bill by going a whole year eating only vegetables he's grown himself.
• James says knowledge isn't needed. Just try growing things. You'll learn as you go. Also, grow what you are actually going to eat. Kale is great, but not if you won't eat it. And finally, squash is king as it produces pounds and pounds of food.
• Start with a 4'x4′ or 6'x6′ plot of land and plant 2 summer squashes and 2 winter squashes two feet apart. Water the roots, not the leaves.
• If you don't have a yard, get creative like a friend with a yard, a community garden, or a local farm.
• In your own garden, build up your soil health with compost.
• When you are genuinely interested in learning, finding mentors willing to help can be easy. Jonathan's brother, Andrew who edits the podcast, has been interested in sustainable homesteading. Through the ChooseFI Facebook groups, he has found a community to learn from and is getting free room and board in exchange for work.
• You get so much power and understanding in your own life just by understanding the concepts of FI. You don't need to be at your FI number to achieve power and autonomy in your life. It starts the moment you decide to make small changes to make your life better.
• Neither Jonathan nor Andrew have reached FI, yet for all intents and purposes, they are living a financially independent lifestyle.
• The goal isn't to have the most money, it's to be post-money, which is beyond the point where money matters. What do you want your life to look like, and what do you need to pull that off?
• Suzanne sent in a question about expense ratios. She didn't know where to look to find out how much she is paying across their various investments.
• First, there may be a fee attached to the fund for it being executed the way it is, known as the expense ratio. Second, if access to the fund is through a financial manager, there could be an assets under management fee.
• The impact these fees can have on your investments is enormous. They can cost an investor millions of dollars over a 40-year time frame.
• Brad suggested Suzanne google the funds' names or ticker symbol and expense ratio, such as “VTSAX expense ratio”. The result should be just one or two clicks away.
• To reduce costs, long-term investors should use a commission fee platform to purchase funds, such as M1 Finance when investing outside of your employer.

Resources Mentioned In Today's Conversation

• Chris Guillebeau's “How to Conduct Your Own Annual Review”
• Grass to Veggies
• ChooseFI Episode 248 You are More than Your Social Capital with Laura Oldanie
• M1 Finance Review

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Many industries we once believed were recession-proof have proven otherwise. What can we do to build multiple streams of income and the resilience needed so that we're not reliant on anyone else for financial security? Side hustles and passive income are key strategies.
• Daniella worked for an IT company for four years when they laid her the weekend before her wedding. Luckily, she quickly found a remote job working as a contractor but was laid off from it as well.
• The layoffs ruined Daniella's confidence and self-esteem. Before the first layoff, she was living paycheck to paycheck and carrying debt. Occasionally, she needed to sell things for gas money until the next paycheck arrived. It was a financial low.
• Daniella still had the severance from her first job in an emergency fund and was encouraged to freelance to keep stable while looking for a new job.
• Freelancing was something Daniella had some experience with and reached out to an old client.
• The talent stack Daniella developed was not simply technical. She had a strong artistic and design background which was mostly self-taught.
• She says when going for a job interview, be upfront about all of the experience you have. Think about it and write it all down so you don't leave anything out.
• Not all jobs require the employee to be a world-class expert. Sometimes having a wide variety of experience and being able to synthesize different pieces of information is what employers need.
• The freelancing came out of panic. In addition to the debt, she had not been aggressively investing for retirement and believed the only way to go forward was a job.
• After finally landing a new job with a FinTech company, Daniella began reading about personal finance for her blog about the journey she and her wife were on to get their finances together.
• Dabbling is something Daniella has done since high school but it was never something she believed could be used to build wealth. Reading the stories of others changed her mind. The future became clear on what they had to do versus what they wanted to do.
• While her original side hustles only fueled her spending behaviors, they eventually morphed into doing fun things. Her wife is an expert in reselling guitars, and in addition to freelancing, Daniella also did thrift store flips, repaired items for resale, and sold her own paintings of live concert events.
• Daniella is in a much different financial position now. They have one year's worth of an emergency fund saved up, and all of their debt is paid off. They still have their side hustles, and her blog makes a third of what she makes in her full-time job.
• If she were to lose her job again, she would be able to reach out to the huge online network she's built over the last three and a half years.
• Facebook, Instagram, Reddit, and Twitter and great for networking. Daniella started by searching for different hashtags on Twitter.
• Jonathan loves Facebook groups. When there is something he wants to learn, he leans into Facebook groups to benefit his talent stack.
• Daniella believes Twitter is especially good for freelance gigs, while Instagram is good for anything since people expect others to slide into their DMs and comments on that platform.
• Since she can work remotely from anywhere and they have multiple side hustles, Daniella and her wife are working on a move from Missouri to Washington State.

Resources Mentioned In Today's Conversation

• Give your child a headstart with their financial and nutritional well-being with Meal Planning for Kids.
• Watch shows live and on-demand with Fubo TV.
• Build a better real estate investment portfolio with Fundrise.
• Get started on your own journey to financial independence today at ChooseFI.com/start.

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

What You'll Get Out Of Today's Show

• 2021 kicks off the fifth year of the ChooseFI podcast. Despite being at different points in their own financial journeys, Brad and Jonathan have experienced the benefit of incremental growth with both their finances and self-improvement. While it may seem simple and even mediocre, they are living amazing lives.
• You need to control what you can control, starting from wherever you are. If you can optimize at the margins, you can reclaim decades of your life.
• It's not just the ChooseFI podcast trying to share this message and concepts. The entire community is working to share this message.
• In a Facebook post from Jessica, she shares that her goal at the age of 19 was to save $5,000 so that she could feel stable. She began finally saving at the age of 26. By spending less and earning more, five years later, she hit the net worth milestone of $100,000.
• The concepts ChooseFI presents are not new. The show brings information together to tell a story to motivate and encourage people to take action with it.
• Don't just do what people tell you to do. Look at what they are doing. JL Collins' blog series, The Stock Series, started out as a way to document what he wanted to teach his daughter about investing. Warren Buffett plans ate leave 90% of his investments in a low-cost index fund.
• What is impressive about index fund investing is that there is ample evidence that over the long-term, this simple plan outperforms other strategies.
• Index funds, like total stock market index funds, are self-cleansing. Rather than trying to pick the winners or attempting to build your own index where you need to stay abreast of what's happening in the market, your ownership in companies performing poorly automatically decreases as a percentage with an index fund.
• To illustrate this point, of the original companies making up the DOW in the early 1900s, none of them remain within it today. With an index fund, you end up buying the up and coming companies that are replacing those losing value without having to do any research.
• It's an odd phenomenon that people do not like to buy stock when the market is down. There are drops of 10% just about every year, 30% every few years, and black swan events like 2020 are more common than we like to believe. Despite of the ups and downs, stay the course and keep investing.
• US currency is backed by the confidence of the federal government. As much as a large percentage of the world also has confidence in our government, $100 today is not worth the same as it was a hundred years ago.
• Not only has inflation eroded the value, but more money has been printed than 100 years ago. Whenever the government prints more money or injects a stimulus, our money is worth a little bit less.
• What is the value of cryptocurrencies, like Bitcoin? They are speculative. You buy now and hope later someone else will pay more for it. Brad has sworn off speculative purchases after a horrible real estate investment years ago, but as a life-long learner, he has a remote interest in it.
• Warren Buffett has described Bitcoin as “rat poison squared” because, like gold, it doesn't produce anything. Investing in it is speculative.
• Moving money back and forth for 5 billion people in the world is both difficult and expensive. People without real access to the world economy can use Bitcoin to meet their needs.
• There are thousands of different cryptocurrencies available and most of them may disappear at some point. Their value is volatile and utility limited. It's also subject to manipulation and is currently unregulated, but we'll keep hearing more about digital currencies.
• The future is going to change, so Brad is always willing to learn.
• Since it's the first episode of the new year, what can you do to make your life just a little bit better? Increase your contributions to your 401K by 1%. Look for investment options with the lowest fees and think about moving them over. Cut an expense you aren't getting value from. Max out your HSA account. Contribute to your 2021 IRAs and other retirement investment accounts. Use Trim to help you lower your recurring bills.
• If you are looking for a new career, train for a new SalesForce position earning $65-80,000 a year with the course Jonathan and Bradley Rice created. The five-day SalesForce Challenge with Talent Stacker is free.

Resources Mentioned In Today's Conversation

• Meal Planning Made Easy
• ChooseFI Episode 284 JL Collins
• Get a free 60 day trial of Linkedin Sales Navigator
• Start the year with a smart money move and get up to $3,500 when you transfer to M1 Finance
• Fifth Wheel Physical Therapist
• ChooseFI Episode 072 Should I buy Bitcoin with Myles Wakeham
• ChooseFI Episode 099 Generous Giving on the Path to FI with Michael Peterson
• Save money magically with Trim
• ChooseFI Episode 117 Making the Case for Part-Time with Bradley Rice
• Sign up for the free five-day SalesForce Challenge

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• When it comes to investing strategies, one of the most influential books available claims that if you keep it simple, you'll actually do better.
• Here to talk about the philosophy behind his investment strategy is one ofChooseFI's most requested guests, JL Collins, author of The Simple Path to Wealth, and popular blog series, The Stock Series.
• The influence of JL Collins cannot be overstated. The content he produced changed the trajectory of Brad's life and made him feel comfortable investing.
• In 2011, JL's daughter was in college but was turned off of all things financial after he pushed too hard. Because he wanted her to know how to invest and handle money, he decided that he needed to write it down for when she was ready.
• It was suggested that he archive the advice in a blog and share with friends and family. Much to his surprise, strangers began to find it and he quickly had an international audience.
• The book came out of the growth of his blog. Always having the ambition to write a book, The Simple Path to Wealth became a more organized and concise compilation of his blog articles. Four years later, 2020 has been its best selling year and the success has greatly exceeded expectations.
• Readers have responded positively to the authenticity of his writing, which he believes is because he was writing for his daughter. Now that she is a young adult, she's been receptive to the information and is now on board with the strategy presented.
• For Brad, investing always seemed like something that required thousands of hours of understanding and special insight until he began reading The Stock Series on JL's website. It gave him hope that he had a chance at long-term success for wealth that would last for many decades.
• JL acknowledges the method in the book is the last and best method he came to after going through other iterations involving picking stocks and actively managed funds. The other methods work, but they are harder and a lot less powerful than a low-cost index fund.
• JL says this method isn't just for beginners, it's the best way to invest for everybody. The most powerful way to invest is the simplest and the easiest.
• He realized that not everyone wants to think about investing the way he like thinking about it. Most people know it's important, but have more important things they want to do with their lives. His approach allows them to set it and forget it.
• The investing world is complex by design because the more difficult it is to understand, the more Wall Street can charge in fees.
• Jack Bogle, the founder of Vanguard, was the first one to invent index funds and talk about index fund investing. Because outperforming the market as a whole is extraordinarily difficult, only 20% of fund managers in any one year can do it. After 30 years, the percentage of fund managers that can do it is less than 1%.
• Even Warren Buffet wrote in his 2013 Berkshire Hathaway shareholder letter that he would advise the trustee of his estate to invest 10% in government bonds and 90% in a very low-cost S&P 500 index fund.
• A mutual fund, or similarly, an Exchange Traded Fund (ETF), takes money from a lot of investors and lumps it together to invest it in something.
• The S&P 500 index invests in the 500 largest US companies that make up the S&P index, while an actively managed mutual fund may focus on a different parameter, such as energy or technology.
• An actively managed fund attempts to pick stocks that over time will outperform the index which is an expensive route and reflected in what the investor pays for the fund, called the expense ratio.
• Every fund has an expense ratio, but what matters is how high it is. Because index funds don't have those expensive fund managers, the fees are very low. JL's most recommended Vanguard fund, VTSAX, has a 0.04% expense ratio. Actively managed funds average 1%.
• The impact 1% has compounded over time is dramatic. On a $1M portfolio, you may be withdrawing 4%, or $40,000, each year, while 1%, or $10,000, goes into the pockets of those managing your portfolio. That's money not going to you or working for you by growing over time.
• In an article Brad wrote several years ago, he looked at the impact fees had on an investment portfolio. With a 1% expense ratio and/or a 1% fee for assets under management, the fees over a 40-year period cost millions of dollars.
• Owning index funds means you own all of the companies within that index, both the winners and the losers. VTSAX is Vanguard's total stock market index fund which invests in virtually every publicly-traded US company.
• There is very little difference between VTSAX and the S&P 500 index fund since VTSAX is capweighted, meaning it owns more of the largest companies. Only 15-20% are small or mid-cap companies.
• JL loves index funds because they are self-cleansing, meaning that you benefit from the winners while the losers drift away. The worst you can lose is 100% on a company, but you can gain 200% or even 1000% with the winners. Tesla is a great example of the upside.
• An S&P 500 index or total stock market index fund is essentially the same regardless of which brokerage firm it is purchased from. JL prefers Vanguard because it is structured where its interests are identical with the investors. The investors own the Vanguard funds which helps to continually drive down costs.
• The impact of changing from a fund with a 0.04% fee to 0.02% or even 0% isn't tremendous. JL prefers to stick with a company like Vanguard that favors the investor over the owner.
• Another thing Vanguard is trying to do is make investing more accessible. They have lowered the minimum investment for VTSAX from $10,000 to $3,000. Those without an initial $3,000 to invest can opt for VTI, the Exchange Traded Fund version of VTSAX.
• VTI is primarily a trading vehicle that any amount of money may be invested in. Like a stock, buy and sell orders are executed immediately, while index funds prices are set at the close of the business day.
• Traditionally, investors have needed to purchase whole shares of ETFs. Companies like M1 Finance have made it possible to buy fractional shares.
• It would be wonderful if we could time the market, but it's more important to have time in the market. The best way to lose money is to try and dance in and out of the market. Trying to time the market does not work.
• When the market began to drop during the beginning of the COVID pandemic, JL held strong in his conviction that no one knew what the market was going to do. The important thing to do is to stay the course.
• You have to expect market drops during your investing lifetime. JL says no one should follow his advice unless they are absolutely clear that they will not sell when the market drops. Selling is not an option. Market drops are temporary.
• After Black Monday in October 1987, JL, despite knowing better, lost his resolve and sold near the very bottom of the market. He didn't buy back in until the market had completely recovered. Now, market fluctuations don't bother him.
• Roughly 20 companies make up 30% of your holdings in an S&P 500 index fund. Any company or sector that rises to the top means you'll own more of it. When those companies fade away, the individual who owned them in an index fund will fare better than an investor who owned them as a single stock.
• The most powerful companies today will not be the most powerful companies decades from now. Of the original companies making up the DOW, not a single one remains in the DOW. With an index fund, you never have to worry about what's fading out or what's rising. You will always be there.

Resources Mentioned In Today's Conversation

• ChooseFI Episode 019 The Stock Series Part 1 with JL Collins

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• It's Part 3 of ChooseFI's end-of-year wins where we hear directly from our community members. During this live event, listeners shared the actions they've taken during the past year that have helped them to spend less, earn more, and enjoy the journey.
• This year, the year-end-win episode took place in a three hour live Facebook and YouTube event featuring around 20 members of the community.
• Are you building an amazing life or are you a cog stuck in a very depressing wheel? It could be either or it could be both. The community members featured in this end-of-year wins episode have had the wake-up call.
• We can't control everything, but there probably are some things we can control that we haven't yet considered. Hopefully, these wins from the community will provide inspiration and imagination to find improvement with at least one thing.
• Our first win comes from Sara, who teaches high school science. She began listening to the podcast in December of 2018 and after binge listening to half of the available episodes, she opened a Vanguard account with all of the money she had saved. This year, she put money into 457s, maxed out Roth accounts, and put some money in a 403b.
• And finally, Sara also just made her last mortgage payment, paying it off in just 11 years. With the mortgage paid off, Sara is now debt-free.
• A special shout out to MK who recently gave birth to a brand new tax-deduction, otherwise known as a baby girl. MK and her husband, Jason, hit FI in their late twenties, and in addition to working for ChooseFI, MK has written a handful of science fiction books and teaches others how to self-publish with her YouTube channel, Author Your Ambition.
• The next end-of-year win comes from Whitney who fired her financial planner this year. While her financial planner had set Whitney and her husband up fairly well, they were finally ready to fly on their own. Now that she understood what she was doing, she was able to get out of some of the actively-managed funds and do some tax-loss harvesting.
• After an unfortunate incident with a supervisor, Whitney was motivated to figure out how she could not work if she didn't want to. Previously, she had no extra time to figure things out, but being at home due to COVID allowed her to explore hobbies, take care of health issues, and do more activities with her son.
• Although making even the 1% better changes aren't always easy, it is a positive feedback loop where it becomes easier and easier.
• Whitney plans is to retire in the next couple of years.
• Next is Carlos, who welcomed a new baby this year. His wife took some photography classes and after seeing that her photos were pretty good, set up a new business as a photographer.
• Jonathan says he's noticed a pattern when trying to learn a new skill. The first is that it's something that interests you. Next is finding a community, getting some training, and finally doing it.
• Although Carlos‘ wife had to hit pause with the business a few times during the pandemic, she's still managed to have success even in this challenging year.
• Carlos started a blog this year. As an immigrant from Brazil, he had issues with the IRS and decided to share his experiences so that he could help prevent others from making some of the same mistakes. He's is writing the first article and will soon be launching Alien Moolah.
• Citlali and Jose have spent the last year adapting and keeping good habits. They moved to California three years ago and needed to get a budget together and manage cash flow after encountering high rent prices.
• They found ChooseFI early when just six episodes had been released. Living on a single income, they were open to the messages presented.
• Since then, they have tried house hacking, Citlali earned a degree through Udacity, got a job working on autonomous vehicles, and they moved to Texas, which decreased their cost of living.
• Jose says the aggregation of marginal gains has helped them to save. Meal prepping has cut their meal costs and allowed them more free time during the week for other things.
• Because the pandemic has them driving less and they've built up a good emergency fund, they've reduced their auto insurance coverage and cut the cost in half.
• They also frequently use the library for ebooks and more unusual things like museum passes.
• Citlali‘s big win this year for a 50% salary increase following her performance review which is helping to increase their gap.
• But Jose and Citlali are reaping the benefits of FI before reaching it. With family in Mexico that has been hit hard by the pandemic, they have been able to provide financial assistance to buy food and pay off medical debt.
• Shannon's year has been one of adaptation. She works at a college where her responsibilities have increased and transitioned. As a result, her boss was able to negotiate approval for her position to be full-time. The increase in Shannon's gap allowed her to pay off her car loan.
• Shannon also started a unique side hustle creating videos combining World of Warcraft and making cocktails, under the title TipsiGaming, which can be found on YouTube and Twitch.
• With no debt and this year's salary increase, Shannon hopes to buy a home and house hack the payment.
• Finding ChooseFI a little over a year ago, Shannon has one month in emergency savings and now she has seven months saved up.
• Wrapping up the series are Rob and Joni who are preparing to hit the road for RV life. They discovered the FI community about two and a half years ago. Starting from essentially zero, their net worth is up to $250,000 and their investments are at $150,000.
• They quickly got used to living in 200 square feet, enjoyed get rid of stuff, decluttering their life, and being able to quickly clean up their home.
• They both work from home, making them location independent.
• When they married in 2016, they followed a more traditional contribution of 10% into a 401K. Though they were debt-free when they found the FI community, they didn't start to crush the income side until about two years ago when Joni combined her skillsets, switched careers, and doubled her income.
• Rob and Joni's expenses are fairly low. The RV is paid off but they bought some land to put it on. when on the road, their base expenses should be roughly $2,000 a month.
• For more information on the free Five Day Challenge or to sign up for the newsletter, go to ChooseFI.com/start.
• Next week JL Collins joins the podcast again to revisit the Stock Series concepts and share his perspective on some of the nuances discussed with other guests of the show.

Resources Mentioned In Today's Conversation

• Your Money or Your Life by Vicki Robin
• ChooseFI Episode 019 The Stock Series Part 1 with JL Collins
• The Simple Path to Wealth by JL Collins

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• It's Part 2 of ChooseFI's end-of-year wins where we hear directly from our community members. During this live event, listeners shared the actions they've taken during the past year that have helped them to spend less, earn more, and enjoy the journey.
• This year, the year-end-win episode took place in a three hour live Facebook and YouTube event featuring around 20 members of the community.
• After listening to the podcast for months or years, how did individual members of the community take in information and take action leading to success in a very challenging year? Success isn't just the nuts and bolts of money. Ultimately, it's a life optimization strategy.
• In response to Brad sharing in an earlier episode that he was joining Alan Donegan in his burpee challenge, Christine wrote in to share that she was inspired to step up her run by throwing in burpees along the way even if she couldn't complete the pushups.
• Being perfect isn't realistic. Challenge and struggling are important, as is trying to get to the point of mastery. You grow during times of discomfort and failure.
• The first end-of-year win comes from Eric. Introduced to FI by his best friends over a year ago, Eric binged listened to the podcast. In January of 2020, Eric and his wife re-scripted their financial life.
• Eric is an architect and started creating YouTube content as a side hustle on his channel 30X40 Design Workshop.
• Re-scripting their financial life started with paying down all their debt, including mortgage, with the cash they had saved that wasn't doing very much for them and built a six-month emergency fund.
• Having that headspace allowed them to take more risks during the year. They don't have a specific monthly budget, but as long as his wife keeps her job as a research scientist, they are good. Everything he makes is going toward FI, including a post-tax brokerage account and 529s.
• The FI literacy they've picked up from the podcast has shown they are a lot closer to their FI number than they thought.
• The friend who introduced Eric to FI was Jason, who also had end-of-year wins to share. Jason figured out early in his career that he didn't want to persist working for other people until retirement age.
• Five years ago, Jason learned about the FIRE community and began to buckle down, working toward a strategy.
• Jason says they've always been good savers and put salary increases and bonuses toward retirement savings. In 2019, he realized 2020 was the year they could hit FI. He actually achieved it in May 2019 and stayed at his job until June 2020 because he had some things he wanted to see through.
• In June, they moved from a high-cost-of-living area to a more moderately priced location. He began blogging on his website, The Next Phase is Now, to help work through the tornado of feelings he was experiencing.
• Before retiring, they lived on their FI budget for a full year to give them confidence. Currently, Jason is drawing from his cash reserves, which he moves from a Fidelity account to his checking account once a month like a paycheck.
• Next up is a question from Rebecca, who wants to know how to calculate her FI number when both she and her husband have pensions. Jonathan says the difference between your monthly expenses and your pension is what your FI number will need to cover.
• The book by Grumpus Maximus, The Golden Albatross: How to Determine if Your Pension is Worth It, as well as episodes 057 and 227 with Grumpus are good to check out if you have a pension.
• The next listener sharing her wins is Sara. Sara sold her care and began investing in VTSAX this year after graduating in 2019.
• As a new investor, the market fluctuations this year were intimidating, but after reading The Simple Path to Wealth, she felt like she was getting in during a low period.
• Sara's only debt is $78,000 in student loans which she hopes to pay off by age 30. During this 0% interest period, she has deferred making payments and has saved $20,000. It's a safety net that she's trying to decide what to do with.
• Her employer offers a .5% match up to 6% in her retirement plan. Sara has increased her contribution since deferring her student loan payments and is looking to roll over an account from a previous employer.
• Sara is trying to keep her expenses low and estimates her savings rate to be 30-40%.
• Listener Jake has made a lot of big moves this year, which means undoing all of the American dream ideas that had been drilled into him, like the fancy apartment, car, and clothes. They weren't making him happy.
• After listening to the podcast, Jake took action and moved into a place that cost him half as much, traded in the fancy car for a used Prius he paid cash for, and slashed his spending.
• Another big move Jake made was to refinance his private student loans with a 10% interest rate to 4%. He's putting every extra dollar toward student loans and will 100% debt-free by the end of January.
• The Talent Stacker podcast has lit a fire under him and Jake's goal for the end of 2021 is to hit $100,000 net worth.
• Being able to work remotely, Jake has moved back in with his parents and reduced his rent to zero. Bradsays he credits living with his parents after graduation as the springboard for everything that came after.
• Zach says it's been a great year figuring out his why of FI and taking actionable steps. He thinks whether we realize it or not, we're all chasing time and health.
• He wants to travel the world in business class and loves his 2006 Hyundai Sonata. For Zach, finding happiness wherever he is at is the FI goal. It's all about what you personally value.
• His investments are set up to meet his passive income goal. At the beginning of COVID, Zach started two businesses. While a pandemic doesn't sound like a good time to start a business, Zach says any time of strife and change creates opportunity.
• Next up is Kosta who says despite the tough year, his path to FI has accelerated and COVID hammered home the need to do it.
• Three years ago, Kosta and his fiance thought they had made it with their lucrative careers. But when he learned about FI in 2018, he was hooked. They worked together as a team to pay down student loan debt and put a 20% downpayment on the house they bought at the beginning of this year.
• Health issues that may take both of them out of work motivated them to ensure their later years were easier. And a by-product of FI, Kosta has lost 84 funds this year!

Resources Mentioned In Today's Conversation

• Buy a ChooseFI ebook bundle and save an extra 15% with code “holiday15”
• Build a better portfolio with M1 Finance
• ChooseFI ebook store

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• It's the ChooseFI Christmas Edition where we hear end-of-year wins direct from our community members. During this live event, listeners shared the actions they've taken during the past year that have helped them to spend less, earn more, and enjoy the journey.
• This year, the year-end-win episode took place in a three hour live Facebook and YouTube event featuring around 20 members of the community.
• Despite how tough this year has been, many people were able to implement some of the strategies and tactics discussed on the show into practice and find more margin in their lives.
• The first featured win comes from Valerie. She purchased a condo a couple of years ago and has been working on renovating it. While not a financial win, Valerie says putting it behind her is her biggest personal win.
• Finally closing out the permits allowed her to refinance her mortgage, saving her $466 a month. She was also able to pay off her credit card renovation debt, saving her an additional $600 a month. In total, Valerie paid off $34,000 of debt.
• Besides the debt, Valerie also maxed out contributions to her HSA and because she now has an additional $1,000 a month, she increased her 401k contributions from 8% to 11%.
• Valerie opened her first taxable investment account and rebalanced her portfolio, while her side hustles earned her $4,000, mostly from participating in focus groups.
• Due to COVID, Valerie wasn't spending as much money and it allowed her to focus on things she might not have had the time to do and she's now one-third of the way to her FI number and hoping to retire by 2030.
• Brad comments that cutting $1,000 in monthly expenses is $300,000 less Valerie needs in retirement when using the 4% rule.
• Valerie has been sharing her copy of ChooseFI: Your Blueprint to Financial Independence with family members.
• The second end-0f-year-win comes from Michelle who learned about ChooseFI after Googling financial independence while attending a conference. To convert her husband, she had him read ChooseFI's book and then scheduled a date night to discuss it.
• Michelle‘s husband, Greg, never thought he could retire early. They didn't have a lot of debt but bought into the concept of getting 1% better and things began to snowball.
• During the last year, Michelle and Greg joined their finances, maxed out their 401k, sold a rental home, bought a short-term rental, and broke up with their financial advisor.
• They opened a Vanguard account and moved their accounts over after discovering their financial advisor was making a lot more in fees than the $50 per month to come up with an investment plan.
• Because Michelle and Greg met later in life, they had maintained separate accounts. After joining finances and being transparent, they found making small 1% better changes each week didn't hurt at all.
• All of the extra money that came in from COVID refunds or bonuses went toward paying off the debt from new windows. They also started travel hacking.
• Michelle says when breaking up with your finical advisor, chances are they won't understand FI, so state that it's you not them and feel free to contact her for help breaking up with your advisor.
• Up next is Chris, who has been a member of the FI community for about three years. He got started by reading The Simple Path to Wealth and Your Money or Your Life.
• For Chris, the pandemic has been an opportunity allowing him to save $15,000. He's been able to max out his HSA and Simple IRA.
• Chris also has two adult children to who he has introduced the concept of FI, as well as his nieces and nephews who have been very receptive to the information Chris has provided. He says to reach out and if they are interested they will let you know.
• One of the actions Chris took this year was to switch to Policygenius, which saved him 50% on policy premiums.
• The next end-of-year-win comes from Lauren. Lauren found ChooseFI in late-August and is on Episode 61R.
• Lauren got a side gig in August being a census worker which enabled her to pay off all $7,000 she had in consumer debt. With all of the premium pay she earned, it ended up being $1,300 a week. She says she wouldn't have taken on the side hustle if it wasn't for the podcast.
• After learning about 403b's, she switched from stocks and bonds to VTSAX. She and her husband also opened up a joint VTSAX account and reduced all of their monthly recurring bills to as low as they could possibly be. She's currently looking for hacks for satellite service.
• In July, they moved into a home that they are caretakers for, which is an upgrade that eliminated $1,100 in rent. They found the caretaker job through her mother but says other caretaker or home sitting positions can be found online.
• Since August, Lauren has earned or save roughly $9,000 since finding ChooseFI and taking action. They are now trying to pump as much money as possible into retirement accounts.
• When an old job asked her to come back to work for them, she opted to focus on what things were important, like the baby she and her husband are expecting and how they can raise it frugally.

Resources Mentioned In Today's Conversation

• Register for The Simple Startup Winter Challenge and save 15% with the promo code “podcast”
• Automate your investing strategy with M1 Finance
• Sign up for the ChooseFI Foundation's FREE FI101 course
• Get the ChooseFI Foundation's FREE preK-12 finical literacy curriculum

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Teachers have been getting taken advantage of when it comes to their investment options. Thankfully, the internet and technology have made it easier to get the word out and help teachers wanting to do better.
• During his first year of teaching, Dan Otter was asked if he cared about his financial future. He politely listened to a hardball sales pitch about an investment scheme he didn't fully understand.
• Rather than blindly following other teachers at his school who had invested in it, Dan began to educate himself by learning about John Bogle, Vanguard, and low-cost investing.
• He learned the salesperson who had approached him was trying to sell him a high-cost annuity inside a 403b and that it was a terrible product.
• Unfortunately, most of his colleagues had signed up for these poor investment products despite having more than 100 options available to them, including Vanguard.
• Dan began to speak up and asked pointed questions when other teachers began to talk about their sales agent in the teacher's lounge. Though he had never done it before, he started looking at their statements and showing them how much the fees were.
• Appreciating Dan‘s insight and help, it was suggested that he put on workshops. After thinking about it, he bought the domain 403bWise, and with help from a friend, they built and launched the website in March 2000.
• The mission of the website was education and advocacy, where teachers and school employees could come and learn about the 403b in a non-sales environment and also advocate for low-cost options like Vanguard.
• Although this was 20 years ago, Dan says the problem with 403b persists today. Teachers usually find 403bWise after they have been sold one of these expensive products.
• Dan says that not all 403b's are created equal. After working in different environments where 403b's are available. They were largely terrible in the public school systems with many vendors. Private schools generally have just one vendor, as do universities, like Fidelity, TIAA-CREF, or Vanguard.
• 403b's fall outside of federal oversight, specifically Arista regulation, so the employer does not have the same kind of fiduciary duty. Just being on the list signifies tacit endorsement, however, the vendors are not vetted by the school districts.
• Just because you aren't paying money out of pocket, doesn't mean there are no fees. Vendors make the fees hard to find.
• Teachers all over the country can get fee information on the website, 403bcompare.com.
• Dan says to look for costs in two places; mortality and expense, and then look at the mutual funds that are part of the annuity. If you find out that you are in a bad product, you may also have to pay 7% of your balance just to get out of it.
• Using the hypothetical example of a relatively new teacher earning $50,000 per year who expects to retire after 30 years, the difference between investing in one of these terrible annuity products versus one found after learning more from 403bWise can be $200,000.
• Over 35 years, a teacher contributing $250 a month earning 6% will earn $185,391 when investing with one of the lunchroom sales agents, while the teacher investing the same $250 a month earning 6% interest with a low-cost company will have $343,000 at the end of 35 years.
• Dan was able to visit the Vanguard campus as a guest of their 403b unit and says they are very focused on this market and getting on vendor lists.
• A good fee for a 403b is 0.5, or 50 basis points, or less. Companies like Fidelity, Vanguard, and Aspire Financial Services are good. In California, CalSTERS, the state pension agency, created their own 403b after and is on most vendor lists.
• Do not confuse Fidelity with American Fidelity Assurance, which is a high-cost company.
• A 457 may be an even better plan than the 403b. Reputable 457 plan companies include TIAA-CREF, T. Rowe Price, and Vanguard.
• The National Tax Deferred Savings Association is a well-funded lobby with an interest in maintaining a high cost, multi-vendor 403b environment.
• Montgomery Country schools in Maryland is one of the few school districts to put their 403b plan out for bid. They reduced the number of vendors down to just one, Fidelity, and plan participation and contribution have increased.
• Dan would like to see every district do what Montgomery County did, but it needs to start with the teachers from the ground up.
• The 403Wise website has three main sections, education, advocacy, and community. Under the Quick Start Guide, the tool, Find a Good Vendor, on the home page allows teachers to search within their own school district.
• 403b compliance is often outsourced to third-party administrators who bring in vendors who yield them revenue.
• Even one of the big national unions, the NEA, has an endorsement deal with a financial company called Security Benefit, which offers a product called the NEA Value Builder with load fees of 5%. After being sued, they offer a fantastic and unadvertised product called NEA Direct Investment.
• Anyone who would like to try and make a difference in their school district should reach out to 403bWise because they are building a network of advocates.
• In addition to joining the Facebook group, reviewing the website, and learning about the 403b vendors available to you, check to see if a 457b plan is also available.
• A 457b works similarly to a 403b but has a few more amazing benefits. If you separate from service, you can access the money in a 457b tax and penalty-free. Also, when just three years before retirement age, you may double contributions. And finally, 457b's requires more fiduciary oversight.

Resources Mentioned In Today's Conversation

• Register for the Simple Startup Winter Challenge and save 15% with the code "podcast"
• ChooseFI Episode 220 Fix My 403b with Nancy Bachety
• Fix My 403b
• 403bcompare.com
• Buy any 3 month plan and get another 3 months for free when you switch to Mint Mobile
• Create a shopping list with Honey for a chance to win!

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Continuing the conversation discussing financial basics, today's episode covers how to get started investing, banking, and setting up your financial life.
• As a recent college graduate, Brad had the motivation to get his financial life together but didn't really know how to go about doing it. During his first job, he wanted to open up a Roth IRA after learning about the power of compound interest.
• Unfortunately, the investment advisor who helped get him set up invested in a fund with a 5% upfront load. That means 5% of his investment automatically went to pay the advisor's commission. Brad'sinvestment was treated like a quick payday for the advisor.
• Not all financial advisors are bad, but you can learn how to get set up with a low-fee or no-fee investment without feeling confused or overwhelmed by the process.
• It's important to understand all of the possible fees that can impact the return on your investment. In addition to load fees, there are other fees to watch for, such as assets under management fees where you pay a percentage for the advisor to manage your account, or expense ratios which pay the team who actively manage the activity of buying and selling within the fund account, and with a surrender charge, you may pay fees to get your money out of the investment.
• If Jonathan was giving a family member financial advice on how to get started, it would begin with banking. Do they have a banking system set up and understand the differences between checking and savings accounts? What other variables should be considered?
• Getting a checking account set up is first and becomes the repository for income coming in and money going out, such as paying bills. Brad uses autopay to have many bills automatically draft from his checking account.
• Brad likes simplicity. Because he knows which days money will be coming in, he sets up his bill autopay dates around that. He also ensures he has a couple extra thousand dollars in his checking account to cover anything unexpected with him having to track the balance every day.
• Jonathan does something similar in that he uses the pay from last month to pay this month's bills, which means there is always around a month's worth of pay in his account giving him plenty of margin.
• Try to minimize fees in every aspect of your life. Select a bank account option that requires the lowest minimum account balance to avoid a monthly fee. Avoid overdraft fees by asking the bank to remove that option or connect to a credit card. Don't pay ATM fees by trying not to use cash or plan ahead and withdraw cash from your own bank fee-free. Some online banks will reimburse ATM fees.
• Brad doesn't keep all of his financial assets in a checking account. He used to use a saving account at the same bank that was connected to his checking account. However, it earned very little in interest. Online savings accounts, like those at CIT Bank, frequently offer a much higher interest rate on their savings accounts and still allow access to the money within 2-3 business days.
• Your investing goals are determined by two items: your cashflow and what sort of safety net you need. Money that might be needed in the short-term and accessible within days, such as for emergencies, should be kept in cash in a savings account. Money that isn't needed for 10 years or more, should be invested because money can lose value over time due to inflation. Instead, that money can be making money and beating inflation. To maintain value, your money needs to make 1-3% per year just to keep pace with inflation.
• Knowing how much to keep in savings and when to move to investing depends on your risk tolerance.
• Make sure your bank is FDIC insured, which means it's backed by the United States Government and covers depositors in the event of bank failure.
• Once you have a checking account set up and you are putting away something each month into savings, getting started investing would be the next step.
• Brad says the best place to get started is with your company's 401K. Find out what the 401K match is and invest at least up to the match. The match is free money from your employer and technically part of your overall benefits package.
• It may be something like a 100% match on the first 3% of your salary you invest. If you make $100,000, 3% equals $3,000, it means you invest $3,000 of your salary and your company also puts in $3,000. It's a guaranteed return.
• If there's an option to check a box and automatically increase your contribution by 1% each year, do it.
• Instead of a 401K, teachers may have a 403b or 457 which are essentially the same type of investment vehicle.
• The maximum amount an employee may contribute in 2020 is $19,500. The total limit for employee and employer contributions combined in 2020 is $57,000.
• Each person needs to figure out what works best for them in terms of funding an emergency fund, paying off debt, investing in their 401K, or Roth IRA. Since contributions may be withdrawn from a Roth IRA tax and penalty-free, it could be used like an emergency fund.
• A 401K is funded with pre-tax dollars, meaning it was invested before that portion of your income was taxed. When it is withdrawn at the age of 59 1/2 or later, it gets taxed at your marginal tax bracket.
• When picking a fund within a 401K, Jonathan's strategy has been to look for index funds or anything with the index beside it.
• Brad notes that the list of funds may also show the funds' expense ratios. Look for the ones with the lowest expense ratios which will be the most similar to total stock market or S&P index funds. Go to Google and type in the ticker symbol to find out more about the specific fund.
• Actively managed funds are run by teams of well-compensated people whose goal is to beat the market. Their fees are incorporated into the expense ratios. Index funds do not try to beat the market, they try to track their market index. Their expense ratios are dramatically smaller since they are managed by a computer algorithm not a team of managers.
• ChooseFI is anti-debt, but not anti-credit card. Credit cards a financial tool when used responsibly and paid off on-time and in-full each and every month.
• Brad tries to use his credit card as much as possible for the safety and security credit card purchases provide, as well as for the travel rewards points that allow his family to travel the world for free or almost free.

Resources Mentioned In Today's Conversation

• Register for The Simple Startup Winter Challenge and save 15% with promo code “podcast”
• ChooseFI Episode 272 Understanding Compound Interest and Investing for Beginners
• Save money shopping online with Honey
• Purchase a ChooseFI Publishing ebook bundle and save with code “holiday15”
• Take the free ChooseFI Travel Rewards course
• The Simple Path to Wealth by JL Collins

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• We're going back to basics and taking a deep dive into the Roth IRA and the levers, tools, and investing strategies available to investors.
• Although ChooseFI offers the free FI101 course, taking small actions are important. Get up to speed and start taking action with the free five-day challenge by going to ChooseFI/start.
• ChooseFI has presented basic investing strategies over the years and will revisit in the coming months to distill and hash out all of the different methods to understand the fundamentals.
• Many of the strategies have a lot of overlap starting with low-cost broad-based index funds. What they all share is a common-sense approach and simple investing strategy which is that time in the market is better than timing the market.
• Most traditional index funds are cap-weighted resulting in a higher percentage of money being invested in a few top companies. Rather than take a dogmatic approach to low-cost broad-based fund investing, it may require the application of scrutiny, being open-minded, intellectual honesty, and consideration.
• JL Collins helped open up Jonathan's eyes to the power of simplicity and helped give him the confidence to start doing better with his finances. But as the terms and concepts have become more familiar, other perspectives become visible, along with the pros and the cons, and the questions he's been able to ask have gotten better.
• The questions you have as you learn more are worth exploring to help build confidence in your plan.
• When investing, minimize fees as much as possible. Fees for buying and selling, expense ratios, and advisory fees are all negatively impact your long-term returns.
• We can learn new things and get rid of limiting beliefs. After a speculative real estate investment went poorly, Brad was afraid of real estate investing. However with some security, knowledge, and looking at it as a business, he has now invested in two single-family rentals which are doing well.
• Financial independence is not finances. It's not money, health, or time. It's all of it. It's making objective, fair-minded judgments about societal norms, seeking the truth, and making decisions in our best interests.
• Sean Mullaney is a big proponent of the Roth IRA and the possibility of using a Roth IRA as an emergency fund.
• Sean says that I all his years of practice, not one of his clients has ever had too much in Roth accounts. The advantage of the Roth IRA is flexibility.
• With a workplace 401k, your employer does not have to allow distributions and if they do, it is probably subject to penalties and taxes. In contrast, contributions may be withdrawn from a Roth IRA at any time, tax and penalty-free.
• In a world of uncertainty, you never know when you'll need access to these accounts, whether in an emergency or for early retirement. A Roth IRA can do double duty as an emergency fund and as retirement investing until a separate emergency fund can be established.
• Sean recommends reading the article on FItaxguy.com explaining Roth IRA Withdrawl and microlayers.
• Backdoor Roth IRAs are for high-income earners who do not qualify for regular Roth IRAs. Roth IRAs are funded with earned income up to an established limit outside of workplace retirement accounts.
• Roth IRA limitations for 2021 are a modified adjusted gross income of $198,000-208,000 for married couples and $125,00-140,000 for singles.
• For an emergency fund, only contributions that may be withdrawn from a Roth IRA. Over the course of contributing for many years, the balance should have grown, but only the contribution amount may be withdrawn tax and penalty-free.
• Roth IRA earnings may be withdrawn tax and penalty-free only if held in the Roth IRA for five years and you are 59 1/2.
• Contributions should really only be withdrawn for early retirement or in the event of an extreme emergency, not for minor emergency expenses as the money cannot be put back in.
• Sean says the same rule applies to health savings accounts. Leave the money in to grow tax and penalty-free because when you take it out, you stop the growth. Pay out-of-pocket instead and document the expenses to claim in the future when you really need the money. Brad and Jonathan scan their invoices into a Google drive.
• For those on the path to FI, unexpected expenses like a stained ankle are unfortunate events, not emergencies because FI puts you in a position of strength with additional options.
• This week's book winner is John, who negotiated a $100 per month rent discount by prepaying six months in advance using money saved for a future home down payment. The new location also allows John to bike to work saving on transportation costs.
• With this year being so tough for people, Jonathan thought back to an episode with Bradley, who made over $1 million in ten years with Salesforce. Intrigued by the conversation, he contacted Bradley again to see if his success was replicable. As a result, they built a training and job placement program and launched the Talent Stacker podcast.
• One of the students in the course was able to land a new job making $70,000 within 42 days of starting the program after being laid off from COVID.
• If interested in learning more about the program, visit talent stacker.com/salesforce.

As always, the discussion is general and educational in nature and does not constitute tax, investment, legal, or financial advice with respect to any particular taxpayer. Please consult your own advisors regarding your own unique situation. 

Resources Mentioned In Today's Conversation

• Register for The Simple Startup Winter Challenge and save 15% with promo code “podcast”
• Enroll in ChooseFI's free financial independence training course
• ChooseFI episode 019 JL Collins The Stock Series Part 1
• Sign up today with M1 Finance and get $10 to invest
• Purchase an ebook bundle from ChooseFI Publishing and get 15% with code “holiday15”
• ChooseFI episode 272 Understanding Compound Growth and Investing for Beginners
• Get started on your path to financial independence at ChooseFI.com/start

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• In a world of uncertainty, how can we future-proof our skillset and also create an environment to help our kids thrive as adults?
• Growing up, Brad never thought about entrepreneurship, but as he has gotten more into this FI mindset, the concept has shifted for him and how he is a model and mentor for his girls.
• While Brad initially thought virtual learning might not be good, he has reframed it and now believes his daughters will look back on this year as a time when they were living their best life.
• Both girls have gone through The Simple Startup workbook, but Molly seemed especially taken to it. After spending a day last week cleaning out one of Brad‘s garden beds in her free time at home, his daughter Molly and her friend have decided they would like to start up a landscaping business.
• It may be that you just need to see the framework and behavior model for entrepreneurship. The business idea may not be as important as understanding the framework for building a business as quickly as possible.
• Brad sat down with Molly to help her think her way through what it is she is capable of and really wants to offer with her business. Whether or not her gardening endeavor ever takes off is less important than the thought process they worked through which can help her out the next time she has a business idea. Having these conversations with your kids is a great way to connect and future-proof their lives.
• While the majority of people in the world will never become entrepreneurs, it's good to start thinking like an entrepreneur and have evidence of what you have skills you have built.
• The Simple Startup still has openings for the Winter Challenge. One student from a previous course is 9-year-old Analise, who while hesitant at first, ended up crushing it with her business, Creative Card Designs.
• The concept behind Creative Card Designs are fun personalized cards you would want to send to someone to say hello, thank you, or for occasions like birthdays. Analise hand draws each card. She has some designs that can be personalized but also takes design requests. Her business mission statement is: To connect people by making quality, personalized cards for different occasions.
• Keeping her business under control, so far Analise has sold two cards. She wants to make it bigger, but sometimes she messes up and burns through her materials just making one card. So she's trying to scale her business by going digital. This will allow the cards to still be personalized, but make it easier on her.
• After coming up with the idea, starting the business, and creating different designs, Analise has set up a website for online ordering which goes directly to her Gmail account.
• Currently, she's charging about $5 a card and making a $2 profit, but by going digital, it will be easier to make the cards and allow her to possibly drop her prices.
• Brad thinks Analise will be able to test out the price for her cards and find the perfect per card price.
• Analise's motivation for starting the business was to make money, but also thinks it's good to learn how to take control of your own things and not always have to work for someone else.
• Andrea, Analise's mother, says the business has been going well and that her daughter has enjoyed learning and adding to her knowledge base. Andrea appreciates that someone is providing support and guidance when they have these ideas.
• Analise didn't go into the class with the card idea in mind. she had several ideas she was torn between and sought feedback from Rob and her classmates before settling on the personalized card business.
• Her advice to other budding entrepreneurs is that you have to come up with an idea for something people actually want, as well as something that will be profitable. She says that if you have a business, don't give up too quickly, and you have to work hard at it if you want to be successful.
• Analise isn't too afraid of failure. After drawing designs and spending all her money on materials, she realized she needed to just figure out another way.
• Andrea says that she's seen her daughter develop a sense of enablement, that she can come up with an idea and watch it grow, and also learning to persist when things aren't always simple or easy.
• The Simple Startup instructor, Rob, modeled coming up with solutions to get past obstacles the students encountered. Learning isn't about reciting facts, but learning how to flex your creative muscle and problem-solve to get things done.
• Andrea says The Simple Startup Camp was much more of a value proposition than she had expected. Being virtual, it was low-pressure, but also comprehensive and detailed with all the aspects of what's required to run a business. Analise even went through a mind-mapping exercise to assess her strengths, resources, and likes to come with a business idea.
• Although some lessons were virtual, Analise was always an active participant. Students in the camp had Rob and each other to reach out to if they were stuck. It was like her very own mastermind group.
• Anyone interested in purchasing a card from Creative Card Designs may visit creativecarddesigns.wordpress.com, fill out the Google form, and Analise will get back to you. Payment will be made with Venmo.
• Analise is laying the groundwork for success, whether with this business of one in the future. Brad himself started several businesses before reaching some degree of success with Richmond Savers, Travel Miles 101, and finally ChooseFI. He picked up skills and knowledge all along the way.
• Since recording the podcast segment with Brad and Jonathan, Analise has gone digital, contacts more people, and doubled her orders.
• There's no fear of failure. It's iterative and failing forward. Once put into practice, all of the skills learned along the way while building a business become demonstrated skills for college and job applications.
• Adding skill to your talent stack and thinking like an entrepreneur is something that the FI community does well. Brad loves being able to read listener emails, like the one from Laura who found ChooseFI episode 265 Talent Stacker, really resonated with her. Because of Jonathan‘s story, she now realizes that she isn't stuck working as a veterinarian forever and can find something else that lights her fire.
• Many professionals like Jonathan and Laura took out six figures of student loan debt only to find that it wasn't a fair exchange. Getting rid of the student loan debt is tough, but it's the right choice. It will give you options.
• While Jonathan can point to a lost decade in his life that he spent in pharmacy school, it's an intellectual exercise. There was an opportunity cost, but there are no sunk costs anymore.
• Jonathan recently found a website and associated app called Supercook which allows you to save money by shopping your cabinets. After completing an inventory of your cabinets, the website will find recipes you can make by only adding a few ingredients. How much money could you save using up what you already have on hand? Reach out to feedback@choosefi.com and let us know the results.
• It's been a tough year for the ChooseFI local groups, but some are still meeting virtually or for socially distanced activities, like hikes. David wrote in saying Brisbane, Australia just has its first meetup.
• 2021 is bringing better things and we are coming back. ChooseFI is looking to do a grand meet up at a conference next Fall called The Unstuck Project. The date is still to be determined.
• This week's FI Weekly winners are Josh, Sheena, and Hayden. After finding the podcast this summer. since April, they have turned their garage into a guest house and listed it on Airbnb, bought an investment property, contributed all of his wife's income to her 401K, began contributing to an IRA, opened an M1 Finance account, opened a Roth IRA for their son, are closing on a second investment property soon, and opened a Chase Sapphire Preferred card.

Resources Mentioned In Today's Conversation

• ChooseFI episode 269 Let's Make Lemonade With a Twist
• Register for The Simple Startup Winter Challenge
• Join the Facebook group, ChooseFI Meals and Recipes
• Purchase a ChooseFI Publishing ebook bundle and get an extra 15% off with code Holiday15
• Easily shop for and compare life insurance with PolicyGenius
• Learn ChooseFI's 3-card cashback strategy and earn $1,000 or more
• Get started on your path to financial independence at ChooseFI.com/start

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Following US Election Day results, it's important to remember the alligators and kittens, a concept to approach overall mental wellbeing. The negative influences in life are alligators and all of the things that make life better are kittens. Focus on getting rid of the alligators.
• It's a human bias to focus on the negative. How do you focus time and attention on the things that make life better? For Brad, he cut watching the news out of his life which has helped him to achieve a better mental framework for life.
• The business model of the new is to keep you watching through the next commercial break. They cause anxiety. You can stay informed without being a part of that model.
• Control what you can control and you will be in a better financial position four years from now regardless of the election outcome. There is so much outside of our control right now and worrying about it isn't productive.
• Despite the number of people who are confident they know what will happen to the stock market as a result of the election, the fact is that we just don't know.
• Market uncertainty is one of the reasons to have a plan for your money regardless of what is going on and automate it. Not only is it difficult to try and time the market, but you need to get it right twice, both when you buy and when you sell.
• The FI community is about long-term thinking. It's not about quarterly earnings or even five-year trends, but performance over multiple decades and the decisions that will help get you to the wealthiest point over that time period.
• With that long-term thinking in mind and in a time of calm, it's a great time to write down your investor policy statement. Having a plan for your investments, written down in an investor policy statement helps you to avoid being reactionary or make rash decisions.
• In February, the Dow hit a high of 29,500. By March 20th, it had dropped 20-30% and many predicted it would go even lower. Defying the dire predictions, the Dow recovered 30-40% of its gains within a few months.
• The problem with making market predictions is that there are far too many variables for you to account for and again, you have to get it right twice. Even the professions are wrong 50% of the time. What chance do you have of making your investment decisions around emotion enough to stay solvent or long-term or outperform the market over the long-term? Essentially no chance.
• The highest likelihood of long-term financial success is to control the expenses on your investments. Low-cost index funds are going to be your best bet.
• Following your investor policy statement and injecting new money when you can benefits you with dollar-cost averaging. Time in the market is much more powerful than timing the market.
• ChooseFI listeners are creating space and making progress in their lives. Patty commuted to paying off debt within five years and just made her last payment, including more than $40,000 in credit card debt.
• Joe replied to Brad's email, The FI Weekly, Joe shared that he and his wife transferred his 403(b) from a high-fee broker to Vanguard and also started on their journey to earning travel rewards by opening a Chase Sapphire Preferred card.
• November 8th is the LAST CALL to apply for the Chase Sapphire Preferred card with its highest-ever bonus of 80,000 Ultimate Rewards points after spending $4,000 in the first three months. For more info, go to ChooseFI.com/CSP.
• Teachers are primarily the ones using 403(b)s, most of which are laden with really high fees and very few options. ChooseFI plans to have an episode in the coming months with Dan Otter discussing doing better with your 403(b).
• Crystal sent in a message saying that she had no idea about fees and was investing with Edward Jones. Her investments hadn't done much over the last five years and now she's educating herself, but the fees appear to be hidden.
• Since the market has done so well over that last five years, the reasons why Crystal hasn't made money are because she wasn't invested in a strategy that allowed her to keep up with the market or she was getting crushed by the fees.
• Brad says finding the expenses for his old company's 401k options was relatively easy. Included in the table of investment options, one of the columns listed expenses. Other titles may be expense ratio or expense percentage. The numbers may range from 1.50 to 0.03.
• Without a nicely organized table, you may need to look up the expense ratio by looking up the ticker symbol.
• A low-cost index fund investment strategy is simple and not complex enough to require help from a professional. In contrast, a complex investment plan is probably costing you a lot of money.
• With an actively-managed fund, a person, or team of people, are making decisions on what to buy and when to sell. Through the fees, you end up paying them for their time. And then the data shows that they aren't even keeping up with the market.
• The difference between expense ratios of 0.1% and 1.0% is tens of thousands to millions of dollars over time after compounding.
• Brad ran through a scenario originally published to RichmondSavers.com reviewing the impact fees have on an investment portfolio over a 40-year timeframe. The result was that a high expense ratio and advisor fees cut the potential net worth in half.
• Even target-date funds may not get the returns you expect because they are too conservative for you.
• It's good to think about what you are invested in and how much it is costing you.
• ChooseFI's new website is now live! Check it out at ChooseFI.com or ChooseFI.com/start. There are still some issues to be fixed, but if you are having trouble finding anything let us know and send us your feedback to feedback@choosefi.com.
• The feedback on The Simple Startup classes has been overwhelmingly positive. Kids aged 10-18 have been getting off the video games and acquiring new skillsets to future-proof their lives.
• Rob Phelan has figured out how to offer the course year-round and the next session starting January 18th is open for enrollment. Registration will be open until January 8th or until it sells out. Previous sessions have always sold out.
• Register at ChooseFI/startup for The Simple Startup between now and November 15th and save $10. Use promo code “podcast” and save another 15%.
• Share what you are doing and how your life has changed by replying to Brad's email newsletter, The FI Weekly, and have the chance to win one of the books from ChooseFI Publishing. Sign up at ChooseFI.com/start.
• Christian Choosefi'd his view of the pandemic. He's focused on the positive things, like spending more time with his family, time to exercise, eating healthier, and saving $4,500 this year.

Resources Mentioned In Today's Conversation

• The Simple Path to Wealth by JL Collins
• ChooseFI Episode 019 JL Collins The Stock Series Part 1
• ChooseFI Episode 220 HelpFix My 403(b)
• Vanguard Funds and the Impact on Your Investment article published on Richmondsavers.com
• Start building a better portfolio today at Fundrise and get your first 90 days of advisory fees waived
• Cut your unlimited wireless plan with Mint Mobile
• Register for The Simple Startup Winter Challenge and get 15% using code podcast
• Get started on your path to financial independence at ChooseFI.com/start

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Yanely grew up in a low-income household in Brooklyn and then attended Brown University. But by the time she graduated, she had accumulated a bunch of credit card debt that she was hiding from her family.
• She tried to figure out dealing with her debt on her own by reading books, listening to podcasts, and watching YouTube videos. After paying it off, she thought it was ridiculous she had never learned it in school and started her own YouTube channel to share her story. That eventually led to her landing the perfect job and a solid career path.
• Growing up, there wasn't a lot of money in Yanely's household, so there weren't many conversations about money either. When there was talk about money, it was always negative and caused tension.
• One thing that her father did teach her was to never have a loan or owe debt to a friend or family member and that she needed to always pay them back. Interestingly, that sense of obligation did not transfer over to institutional borrowing which she believes is a common mindset in neighborhoods like the one where she grew up.
• When Yanely was accepted to Brown University, she had no idea how expensive it was going to be. Although she received a full scholarship, she discovered she still need to purchase things such as textbooks, a laptop, and other supplies. Because her father taught her not to borrow money from anyone, she wanted to figure it out on her own and applied for her first credit card.
• She attributes her attempt to be resourceful using credit cards to a lack of financial literacy. She thought she was doing the right thing and on the right path at the time.
• Her payment history was good since always made the minimum payment and never missed a payment on her credit cards, but her credit utilization was high as she was always close to maxing out her card limits.
• With each credit card application, banks continued to give her credit cards with higher and higher credit card limits. Trying to keep up with the rich kid lifestyles of her classmates ended up getting her $15,000 in debt.
• Moving from a neighborhood filled with Caribbean immigrants to an elite university was a culture shock. Yanely felt like she didn't fit in because she didn't talk or act like her fellow students. Not understanding expressions and phrases others used made her feel dumb.
• Going from a top performing student in high school to feeling like being in the wrong pack may be part of the reason why it's physiologically difficult for low-income who attend prestigious universities.
• Yanely says the biggest thing a low-income student can do is expose themselves to the rigorous language and vocabulary that is going to be expected of you. Students are often not prepared for how much harder they will need to work, it ends up being a shock, and they go home.
• Approximately 2/3 of her credit card debt came from spending on just trying to keep up with her fellow students. Although there was no overt peer pressure, it was unspoken.
• Straight A's and scholarships are not enough. Students like Yanely need to have both academic and social grit to survive in an environment that is not in their comfort zone.
• Reading The Millionaire Nextdoor to help her figure out how to pay off the debt, she noticed the descriptions of poverty and generational poverty were describing the life she was living. She decided she was going to be the one to shift the trajectory of her family in terms of wealth.
• Yanely had a choice to make between continuing a pursuit to fit in and look good while racking up debt, or the alternate route of smashing her debt aggressively and begin to build wealth, breaking he cycle of poverty.
• The interviews of people who didn't come from wealth surprised her, opened her eyes, and completely shifted her mindset. She realized she was going to need to completely wipe her mental slate clean and start with new and fresh beliefs about money and how it works.
• Thomas J. Stanley and William D. Danko, authors of The Millionaire Nextdoor devised a formula for determining if you are as wealthy as you should be. That formula is: Your Age multiplied by Your Annual Income (from all sources except inheritance) divided by 10 = Your Expected Net Worth
• Growing up in a neighborhood where spending to reflect success and social status was prevalent, Yanely understands the pressure and had never imagined there was a different route.
• Her beliefs were shaken to the core listening to interviews of self-made millionaires answer questions and discuss the strategic money decisions they made with a clear goal in mind. It opened her mind and made Yanely want to explore more.
• Despite FI not even being in her purview a handful of years ago, Yanely just hit Coast FI after beginning to maximize everything she was doing with her investments and prioritizing tax-efficient investments before even paying her rent.
• Yanely paid herself first. After learning more about 403bs, she determined her priority should be a Roth IRA. She then invested as much as she could to qualify for the company 401k match. Whatever was left after the investments was used to pay for living expenses like rent and food, and has cut down on her fun money budget.
• Being obsessed and hungry for knowledge helped Yanely pick up personal finance lessons so quickly and go from being in credit card debt to maximizing her investments. Her goal was to learn everything she could and begin producing a result in 90 days.
• She feels that there is an injustice that these things were never taught in her community, her family, or even at her Ivy League school.
• Previously, she would have asked an expert or others for advice and take it. she no longer believes that is a good strategy for solving her problems. She thinks you need to question the experts' motivations and do your own research. This is especially true with investing.
• Her goal with Coast FI was to invest enough that she's be a millionaire by the age of 65 even if she had never invested another dollar again. that meant she needed to hit $250,000.
• Initially, Yanely's goal was to be an agent of change for herself. Now she wants to be an agent of change for others through her YouTube channel where she cold share her story.
• As a teacher, she realized that teachers were also never taught about personal finance in school. Teachers teach students about all kinds of topics, but not about money. Financial literacy is lacking and being passed down from generation to generation.
• An organization reached out to her to come on their podcast where they talk with teachers about money and personal finance to help give them the knowledge and skills to teach it in the classroom. She is know on staff doing educational outreach.
• She says her impact through coaching or her YouTube Channel is limited, but seating change in the education system and reforming the way students are learning in school is the kind of change she is after.

Resources Mentioned In Today's Conversation

• Get a discount on ChooseFI ebook bundles using the code Holiday15
• Register for The Simple Startup Winter Challenge and get 15% using code Podcast
• Easily find coupon codes and save money when you join Honey
• Get started on your path to financial independence at ChooseFI.com/start

If You Want To Support ChooseFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• What's in your talent stack? Inspired by content discovered over the last four years while producing ChooseFI, Jonathan has spent the last couple of months hard at work on the side on a new passion project.
• As said many times here on the show, financial independence isn't about doing less, like sitting on a beach sipping cocktails. It's about aligning your what you value with your life and having the freedom to pursue what you are passionate about.
• ChooseFI has given Jonathan the opportunity to look at and do better with his personal finances, but it's also helped him realize that he loves to work hard, but not necessarily for a paycheck. He'll work twice as hard when it aligns with his interests, passions, autonomy, mastery, and purpose.
• While Jonathan has not reached FI, he does have all the benefits of it. FI is not binary because the benefits of FI start accruing from Day one.
• Time is your precious non-retable resource. You can stick your head in the sand and gut things out until reaching FI, or look around and see what other options we can create for ourselves that bring more joy, autonomy, mastery, and purpose.
• When you find that your ladder is leaning up against the wrong wall, you don't need to stick it to that commitment and grind it out for another 20 years. You don't need to wait for anyone to give you permission. You can pivot.
• One of the better messages to come out of the FI movement is that no matter what has happened, huge student loans, disastrous real estate deals drug addiction, or divorce, you can always move forward and make your life better.
• A life optimization strategy begins with financial security and gives you space for mastery and exploring new things.
• You don't need to be in the top 1% of anything. Just being better than average at a bunch of different things will open up opportunities. What does a high value, high return on investment, talent stack look like?
• Students coming out of college are ill-prepared for the way the world really works. The world wants to know what have you done and what can you do for it. What if you were to focus on the skills the world wants and is willing to pay a high salary for? And then very economically earn certificates stating that you can do this work? You can retain and earn these skills in a year or less.
• There are very few jobs that actually require a college degree. Through certificate programs, you can get jobs earning between $60,000 and $160,000 a year. Jonathan says if he were starting over, knowing what he knows now, this is what he would do.
• Jonathan has started another podcast, the Talent Stacker podcast. It's not for those set on going to college. It's for people looking to see what other choices are out there or who are unhappy with the choices they previously made and are looking for something different and don't have another four years to earn a degree.
• The Talent Stacker podcast does not just regurgitate information learned on previous ChooseFI podcast episodes. It helps you recreate what these other people have done step-by-step.
• The framework of the Talent Stacker podcast is based on a handful of different categories. The first is a time for money or a service role where you trade an hour of work doing something for a set hourly rate.
• The second category is sales, where you help make it easier for a current audience or customer base to make a purchase.
• Category three is marketing or expanding the current customer base.
• The fourth category is team development or leadership or bringing a team together to focus on target goals.
• The fifth category is systems, process, and workflow, helping teams to work more efficiently.
• In reality, many of these categories have overlap. If you can do a little bit of several of these, you can become what is called a Rainmaker.
• Jonathan recognizes how each of these skills has been used and added to his talent stack through the ChooseFI podcast.
• Building a talent stack is not just limited to business owners. It's a mindset about learning new things and how they can help make you a better person.
• Brad used his skills as a travel rewards enthusiast, along with his business-building skills and CPA degree to build a travel rewards coaching service.
• MK found success in her corporate career through choices like learning basic HTML to build her talent stack, which helped her to climb the ranks, and then eventually launch her own business. Her pregnancy has caused her to look at streamlining things and becoming more efficient to keep her passive income stream growing.
• Your real education doesn't start until you get the job. College merely proves to an employer that you know how to learn.
• Jonathan worked with Bradley Rice from Episode 117 to create an actual career development program in Customer Relationship Management (CRM) that you can replicate in six months and make $60,000-80,000 a year, with a path to making $200,000 in 3-5 years.
• With four years of starting ChooseFI, Jonathan has become one of the top independent podcasters and now he teaches podcasting to others.
• With ChooseFI, the goal is to compel you to take action toward reaching financial independence. with Talent Stacker, Jonathan wants to see you develop skills and maybe earn more.
• This week's FI Wins of the Week include Karen. She and her husband decided to invest in camping gear and enjoy camping in Florida before they reach FI and can move to Washington State.
• The second winner is Emma who is 20 and just fully funder her Roth IRA for 2020 and is ready to fully fund 2021 in January.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Learn about all the benefits of the Chase Freedom Flex credit card
• Open a high-yield savings account with CIT Bank
• How to Fail at Everything and Still Win Big: Kind of the Story of My Lifeby Scott Adams
• ChooseFI Episode 117 Making the Case for Part Time With Bradley Rice
• To get your copy of the FI Weekly every Tuesday, sign up at ChooseFI.com/start

IF YOU WANT TO SUPPORT CHOOSEFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Your money story informs so much of your life even if you're not aware of it. For 30 years, Leisa Peterson has been researching and studying how trauma in early life contributes to the money challenges faced later in life.
• Growing up with a scarcity mindset, money became an escape that gave her motivation. Leisa decided in her mid-twenties that she was going to have money in her life and not have any stresses about it as her parents did. Earning money became an all-consuming response to the trauma she had experienced.
• There's a very broad spectrum of trauma from mild to quite serious and not everyone reacts to it in the same way. Some people like Leisa may end up wanting a lot of money, while others are lead to feeling like they have no control over money.
• An adverse childhood study from Kaiser was intended to understand how childhood trauma affected health. In Leisa's reading of the study, she found one of the findings included financial problems and realized this was something not a lot of people were talking about.
• These childhood experiences become very disruptive, brings an uncertainty to how life is viewed and crushed the sense of self.
• The concept of scarcity and uncertainty go together. This leads to struggling with either an extreme need to control or feeling out of control with money.
• Because kids are absorbing everything we say, it's important to change the language we use around money.
• When people become more familiar with their trauma backstory, they are better able to talk with their partner about their money challenges.
• Disconnects in communication can occur when each other's backstories are quite different. We can only know what we know from our own perspective. The job in relationships is not just to understand ourselves, but to see the other person and how they are approaching money differently because of their backstory.
• When people think of something as being scare in supply, they are going to buy more of it. Toilet paper is a relevant example of this for 2020. Someone coming from a home without enough money may have strange buying behaviors. Their idea of scarcity or uncertainty may be showing up in their daily behaviors with money.
• For spouses or partners who have different money stories, Leisa encourages them to just start somewhere. Think about how money was treated at home growing up and have a conversation about it.
• Questions to consider asking are: Did mom and dad talk about money? Did mom and dad fight about money? What is your first memory of money? When did you make your first money? How did that make you feel? Were you afraid?
• It can be difficult to have these conversations for the first time with another person. Journaling is a way to privately have them with yourself first. The first person you share these feelings with should be someone you trust and it may be someone other than your partner.
• Throughout her career, Leisa has found that people react to money very differently. The majority either hold it tightly or avoid control of it altogether, with a minority viewing it as a tool and are at peace with it.
• Having one strong fire in your life influences the way you think about money in life. The earlier the influence in life, the better.
• Parents sometimes joke or convey the wrong message about money. Leisa says it's important to go back and close the loop with children.
• In the FI community, we want our children to have the skills to take care of themselves and be financially independent, but is it possible for them to have too much abundance? Leisa says she wants to be very open about what goes on in their home, discuss their failures, and teach them the value of money and hard work.
• After reaching her goal of becoming a millionaire, Leisa made a massive change in her life. She and her husband sold it all and took a year off to travel with their son. The trip changed their entire approach to life.
• Previously, Leisa's family had been consumers of their money. After the trip, they took their nest egg, created investments where their money began working for them.
• A result of Leisa's drive to become a millionaire was that once achieved, people began to treat her differently. The outward display of wealth began to affect her friendships. It was then that Leisa realized the money was not all that important to her.
• Leisa's book, The Mindful Millionaire, tells these stories about our money experiences, our relationships with money, and how we can transform them into thinking about money as a tool.
• The key takeaway from this conversation is that words matter. It's important to think about the unintended consequences of the conversations we are having with our spouses, partners, and kids. Have humility in these conversations and be honest.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Build a better retirement plan today with NewRetirement
• ChooseFI Episode 246 Overcoming and Battling Financial Abuse
• Open a commission-free brokerage account with M1 Finance
• Get started on your own journey to financial independence at ChooseFI.com/start

IF YOU WANT TO SUPPORT CHOOSEFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Jonathan draws a parallel between the episode on Monday with professional poker player Annie Duke and hitting his weight loss goals. Finding himself well over his desired weight, Jonathan took a health challenge and has kept the weight off for six months making him a weightloss statistical abnormality.
• Where most people diet and get to a goal weight, because the effort was a diet, they end up regaining the weight. What Jonathan did was make a lifestyle change.
• Tying to the discussion with Annie Duke, Jonathan recognized that he couldn't control everything, made better decisions, and set himself up for more opportunities. All of it helped to increase the opportunity for luck to strike.
• Jonathan isn't alone in his endeavor. Through weekly accountability phone calls with his father and FI community member, JD Roth, they check in to ask if each has followed through with their goals for the week
• Their goals aren't all that strict but they are trying to be 1% more intentional with their decisions and look at their decision-making framework, watching for triggers, giving into them less often, and coming up with solutions to not be tempted.
• Brad notes the discipline equals freedom and that the framework Jonathan has created for himself makes everything easier and no longer requires willpower.
• The accountability and decision-making strategies Jonathan applied to his weightless journey can be used for virtually anything you want to achieve in life. Taking action and trying to be just 1% better what ChooseFI is all about. All of the small wins begin to add up, creating nothing but good, grows your gap, and continuous the virtuous circle.
• When we upgrade the quality of our decisions, the impact of them begins to compound and increases our probability of success.
• Brad discusses how 70-80% of the contestations he hears involve one of the three killers of happiness: sarcasm, complaining, and blaming. We can change our mindset and the locus of control to impact our future. He believes putting space between stimulus and control can have positive and compounding effects.
• As often mentioned on the show, you are the average of the five people you spend the most time with. Those five have the greatest influence on your life and you don't want them to have those happiness killer characteristics. Be intentional with your five picks.
• Choose people who give you a path forward and will hold you accountable to the things you said were important to you.
• Brad and Jonathan discussed how the concept of resulting, pro and con lists, and infecting others with our opinions before asking for advice is not helpful when trying to make better decisions.
• As mentioned during Monday's episode, making better decisions requires depth and an understanding of probability and magnitude.
• A challenge for listeners is to write down the five people you spend the most time with and who have the most influence on you. Then write down that their characteristics are that make them a good fit for your top five. And finally, what are the ideal characteristics for people who would be influencing your decisions and where can you find them?
• The second exercise is to approach someone and ask for their opinion on something without prejudicing it first. Don't lead with what it is that you really want to do. Ask your question in a way that gets you additional information you maybe hadn't considered yet.
• The first win from the community comes from Jodie, a self-professed broke chick who found FI in 2016. Since then, she's doubled her salary, gotten out a debt, flipped a live-in property, paid off her card, got married, formed two business with her husband, quit her job, and hit $100,000 in investments. Congratulations on taking action and changing your life, Jodie!
• In response to Brad's weekly email, Evan writes about not shooting for FI with reckless urgency, but a thoughtful understanding of the use of money and how it can improve his life after breaking his finger required surgery. FI isn't about deprivation, but buying the things you value.
• While the world is slowly getting back to normal during the pandemic, John calls in sharing how his wife was able to pivot her events business, Escape Room Races. The pandemic killed her in-person events, but she was able to rebrand, and pivot to a virtual format which is bringing in tons of new virtual events and they just had their biggest month ever.
• Speaking of live events, previous ChooseFI guest, Christine, from episode 137, sent in a letter saying that at least 50 ChooseFI listeners have come to Nashville and taken her tour. Last Fall, one guest from New Zealand Brough five friends from all over the world after hearing about Christine's tour, A Little Local Flavor, on ChooseFI. She also has converted her friends into ChooseFI listeners.
• When you respond to Brad's weekly email and we read your win on the air, you will get one of the ChooseFI Publishing books.
• The first winner is Ahmed who wrote in to say he recently graduated college and was due to move to a high cost of living city. Because they moved to working remotely, Ahmad is saving on rent by staying at home with his parents in a low-cost of living city and investing the savings.
• The second winner is Tommy who received an email from his state's 529 program that he was receiving a $500 Maryland state contribution.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Earn $1000 or more with ChooseFI's 3-card cashback strategy
• Open a commission-free brokerage account with M1 Finance
• Make more on your savings with high-yield savings account from CIT Bank
• Join the ChooseFI Facebook group
• Get on Brad's weekly email list and receive The FI Weekly every Tuesday
• ChooseFI Episode 137 Rebuilding a Life You Love With Christine
• Discover the sites, sounds, and flavors of Nashville with Christine
• ChooseFI Episode 021 The Pillars of FI
• Maryland's 529 State Contribution Program

IF YOU WANT TO SUPPORT CHOOSEFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Annie Duke is a world champion poker player and author of Thinking in Bets, a book which makes the case for embracing uncertainty in our decision-making framework. In Annie's latest book, How to Decide: Simple Tools for Making Better Choices, she answers the question, what does a good decision-making process look like and how to incorporate that into your own life.
• The only way we can become better at making decisions is from our own experience, and our experience is going to be the outcomes of past decisions we've made. We need to understand the way in which knowing how something turned out can mess with our ability to figure out why.
• In a thought experiment concerning the 2015 Super Bowl between the Seahawks and the Patriots, Annie reviews a play called by Pete Carroll in the last seconds of the game. Though widely panned as the worst play called in Super Bowl history, Annie states that it's hard to evaluate the quality of the play called when we already know the outcome.
• Had the outcome of Pete Carroll's play been a touchdown, the reaction would have been the opposite. This phenomenon is called Resulting, where the quality of the result is attributed the quality of the decision.
• Reviewing the actual odds of the result of that specific play, Annie determines that Pete Carroll's decision was far from the worst play called of all time as there was only a 25 likelihood of that specific result.
• Annie applies what she's learned playing poker, specifically realizing that what you see happen doesn't change the decision that you make, to other aspects of life.
• The paradox of experience is that while we know we need all of these experiences to learn, we see how things unfold and we take our lessons for individual experiences, not in the aggregate.
• Poker has some surprising similarities to real life in that your outcome is a combination of luck and the quality of your decisions.
• The definition of luck is what you don't have control over. You cannot control your own luck. You can control the quality of the decisions you make and reduce the chance that luck has an influence that will turn out poorly for you. While we are all under the influence of luck, we are also very much under the influence of our own decisions.
• In our decision making, we should see the luck clearly and make the decisions that are more likely to advance our goals. Brad ties that to ChooseFI's philosophy of the aggravation of marginal gains and striving to do 1% better.
• We have a lot of cognitive bias that delude us into believing things are much more stable than they really are. COVID has torn that away from us. We are also feeling the effect of imperfect information. COVID is not a special case, it's just something we can't hide from the uncertainty.
• COVID does give us an opportunity to think about how to navigate uncertainty which will improve all decisions we make.
• A pro and con list has no dimensions to it, specifically missing are the magnitude of the payoff or how much will it advance or take away from your goal, and what is the probability of each con. These lists also amply biases you already have and can be gamed to reach a predetermined decision.
• With inside view thinking, our personal models create cognitive trenches. When new information comes in, we mold it into a model we already have rather than be objective.
• An outside view is what is true of the world.
• To try and avoid inside view thinking, we need to expose ourselves to different perspectives of corrective information.
• The foundation we base our decisions on is flimsy and full of inaccuracies. We should increase the probability that we collide with perspectives and information we don't know.
• It's okay to say you don't know very much and decide to get more information to become a better decision-maker.
• Making a good decision with one stock doesn't necessarily make you a good investor, you would have to look at all the decisions made with your portfolio.
• When getting to your outside view, it helps to get yourself into the future because it helps us look back on ourselves. We also need to realize that we tend to believe we are more likely to be successful than we actually are. It's helpful to think about all the ways in which you might fail.
• A pre-mortem is the idea that time travel and negative thinking will result in an outside view and lead to better decision making.
• A backcast is the opposite of a pre-mortem where you look at the luck and skills that lead to a positive outcome.
• To find groups of people to get the best opinions from, find people who are interested in finding what is true in the world, but by putting the framework in place, you can turn anybody into an amazing true-seeking pod.
• When seeking other's opinions, it's best not to divulge your own opinion beforehand. It results in one of three ways: it might show the other person's opinion is right, the truth may lie in the middle somewhere, or it may show your opinion is right and help you to understand it better.
• Annie believes that mostly we should be making decisions faster than we do. The decision-making process is a skill and it takes time to understand which we should be taking our time we should take our time with and which could be faster.
• The speed of our decisions should be made by the impact of the decision and optionality available.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy
• Switch to Mint Mobile and save with free shipping
• Get our #1 recommended travel rewards credit card, the Chase Sapphire Preferred and earn 80,000 points
• Get started on the path to financial independence at ChooseFI.com/start

IF YOU WANT TO SUPPORT CHOOSEFI:

• Earn $1,000 in cashback with ChooseFI's 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• After 18 years of ownership, Brad says goodbye to his beloved Honda Civic, Golden Boy.
• When it comes to car ownership, ChooseFI often talks about only buying a new car every 15 years. Over a 45 year adult lifetime, the savings, when invested, can amount to almost $750,000 when compared to someone who leases or just manages a constant car payment.
• Although Brad wanted to keep the car, it had been having some mechanical issues and his family was no longer comfortable riding in it anymore. The impact it was having on Brad's family was not worth it.
• For his next vehicle, Brad opted for a 2013 Honda Civic rather than a brand new car. He purchased his new Civic through Caravana, the car vending machine business, who was selling Civics for roughly $3,000 less than CarMax.
• The buying process through Caravan was quick and streamlined. The car was delivered to his home and he spent approximately one-hour signing paperwork and finalizing documents.
• There are sweet spots when purchasing used vehicles. Although Brad's car is seven years old, after five years, cars have generally already depreciated at the fastest rate. If you are going to buy new, keep it forever. If you buy used, target 5-7 years old.
• Listener Oscar wrote into the show asking about Home Equity Line of Credit (HELOC) which hasn't been something that ChooseFI has discussed much in previous episodes.
• A HELOC is a revolving line of credit on your home where the equity you have in your home is used to secure it. For instance, a home worth $300,000 with a mortgage balance of $100,000 has $200,000 worth of equity. A HELOC allows homeowners to tap into the equity locked up in their homes.
• An advantage of using a home equity loan over other options for access to cash, like credit cards, is that the interest rate is often much lower, although it is a variable rate and can change. The interest rate on a HELOC may be in the 3-5% range versus 15-30% with credit cards.
• For homeowners who placed a sizable down payment on their home, whose home has appreciated, made extra payments, etc., a HELOC becomes a potential source of low-interest revolving credit.
• A HELOC is different from a home equity loan in that with a loan, the loan amount is deposited into your bank account and interest begins accruing immediately. A HELOC provides you with the ability to tap into the equity at any time, such as in the case of an emergency. No interest accrues until you decide to access the money. It gives you options if ever needed.
• Occasionally, HELOCs can be had for no closing costs. Considering that the process to apply and be approved for a HELOC can take weeks, it can be useful to have one in place so that it is already available if and when it is needed.
• Frequent guest and friend of ChooseFI, Big ERN, does not have an emergency fund. He believes that there is an opportunity cost to keeping 6 months of expenses in a liquid account that is likely earning every little in interest. In a thought experiment, he tried to envision a true emergency that he could not cover with credit cards or a HELOC.
• Those working to build an emergency fund before beginning to invest are potentially missing out on higher interest rates earned from investments. They might be better off investing their savings and using money from a HELOC to cover monthly expenses in an emergency rather than selling off investments or using high-interest credit cards.
• Jonathan mentioned that there are schemes to paying off a mortgage early using HELOCs and credit cards that people can learn about for a fee. Brad doesn't doubt that these might work, but it's too complex. There's no insider knowledge worth paying for. He doesn't believe these methods are any more beneficial than making additional principal payments to a traditional mortgage.
• Rather than a HELOC, Jonathan uses a margin loan through M1 Finance for a line of credit. He can borrow up to 40% of his invested assets with an interest rate of 2.75-3.5% and have the money in his account in minutes. Margin loans on investment accounts are lines of credit options for renters.
• Listener Alex wrote in with his win with a High Deductible Health Plan (HDHP) and Health Savings Account (HSA).
• Listener Rachel wrote in saying that she has reached FI and didn't even know it. As a result, she was able to leave a toxic work environment in the middle of a pandemic and spend more time with her nice and nephew.
• FI wins read on the show win their choice of one of ChooseFI's books so keep them coming!
• Listeners Brian and Deb maxed out their 401Ks this week before their contracts ended to take full advantage of the company's match and on Oct 23 will officially be financially independent.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Learn about ChooseFi's 3-card $1,000 cashback credit card strategy
• ChooseFI Episode 022 The Ultimate Guide to the True Cost of Car Ownership
• Get a fantastic term life insurance policy at a fantastic price with PolicyGenius
• Earn a high-interest rate on your savings account with CIT Bank
• ChooseFI Episode 066 The Emergency Fund…Is It a Bad Idea?
• Read DoughRoller's article, Can You Really Pay Off Your Mortgage Early with a HELOC?
• ChooseFI Episode 009 Travel Rewards: How to Travel the World for Almost Free (The Easy Way)
• Sign up for ChooseFI's FREE travel rewards course
• Learn more about M1 Finance here
• Sign up to receive Brad's newsletter, The FI Weekly

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Immigrating to the United States as a child, by early adulthood, Jully found herself caught up in our consumer culture and had acquired five figures worth of debt. After working to dig her way out and starting on her path to finical independence, she's become an advocate. Drawing from her experience, she now help Latinas become financial powerful through investing.
• At the age of four, Jully moved from the Dominican Republic to New York. Her extended family all began making the move as well, but as many immigrants to, they continued to send money and invest in their socioeconomic systems back home.
• For immigrants, investing in their home countries has multiple purposes. There is often an expectation that money will be sent home to support the family.
• Jully's father supported her grandmother by building her a new home and making sure she was taken care of. However, when the grandmother also immigrated to the US, the house back in the Dominican Republic was rented out and became the first property in a real estate portfolio.
• Immigrants have struggles that a typical American doesn't go through. Investing in real estate in their home countries helps connect them to their communities. However, Jully says immigrants tend to invest more in real estate than in the stock market. She shares the message that it is important to diversify their investments.
• When she started working for a non-profit at the age of 19, Jully began investing a 403b for the free money. That decision was criticized by her mother who felt retirement was a long way off and that it wasn't necessary because Americans receive Social Security.
• When her family first arrived in the US, they didn't speak the language. It was a lesson in how to figure things out in the moment and just survive.
• It took a couple of years before her father began thinking in an entrepreneurial way and on a bigger scale. He went from driving a taxi to starting a bodega business.
• The bodega enabled Jully to see both her parents work in that environment, build their business, send money home, and contribute to the community.
• The money lessons she learned from her parents were to be generous and give. But the reality was her father worked a lot to build their life and they didn't see him much. Had he invested more, perhaps they would have been able to see him more.
• Jully went to school for fashion merchandising and economics. When she got her first job, lifestyle inflation kicked in. Working in the fashion industry required looking good with the latest trends.
• After accumulating the debt, Jully realized that she was channeling her emotions with her shopping. She was both celebrating and consoling herself with shopping to the point where it became unhealthy.
• Thankfully she had continued to invest even when the debt was bringing her down. It wasn't until her father became ill that she realized the safety net she had in her parents won't always be there. At that point, she began working to pay off all her debt. Once debt-free, Jully increased her 401K investments to around 20%.
• Jully notes that when first entering the workforce, you feel that nothing can go wrong, or if it does, you'll just figure it out. But you have to start with the basics. You have to start with the foundation of an emergency fund.
• Credit card debt is subject to incredibly high-interest rates of 12-30%. With five figures of debt, the compound interest is working against you and it's hard to fig yourself out from under it.
• To get out from under her credit card debt, Jully had to make significant payments toward it. The key was knowing her survival number.
• She created a simple chart with eight categories of things you need to come up with a survival number. The categories include housing, food, transportation, and even entertainment. Jully's survival number is $581. The items in her $581 figure are the absolute minimum things she needs to survive and keep her life sane.
• The reason she can keep her number so low is by house hacking her four-bedroom apartment. With master leasing, she is responsible for the rent each month, but she then uses sub-leases to rent out rooms.
• She uses Craigslist to market the rooms for lease in her apartment and thinks it is important to find people with similar lifestyles and working schedules which creates a good co-habiting space for everyone.
• After paying off her debt in 2016, Jully felt an incredible sense of freedom, quit her corporate job, and went to work for herself.
• She has been inspired and motivated by the financial independence community to use her platform, Investing Latina, to provide resources and stories, to inspire others to do more, increase financial stability, and reach financial independence.
• Given the struggles that her family faced when they first arrived in this country, Jully speak about building credit and establishing yourself.
• Jully's conversations with new immigrants start her three pillars, building credit, investing in the stock market, and real estate. The first step is to open a debit account to start establishing relationships with banks.
• While there is still something of a stigma to talking about money and investing in the stock market in her family and community, Jully is hopeful that it will normalize and influence others. Even having small conversations like, “What are you saving for?” is a little way to get started.
• As someone who works in fashion, Jully's transition to her survival number she realized her shopping was an addiction. Using Marie Kondo's methods for embracing minimalism, she cleared out her closets to create a capsule wardrobe, focusing on the items that fit well, looked good on her, and were comfortable.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Learn about ChooseFI's 3-card cash back strategy
• Easily find coupon codes and save money when you join Honey
• Track your real estate portfolio's performance and get your first 90 days of advisory fees waived with Fundrise

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• In our eighth Households of FI touchpoint episodes, Kristi was successfully following the standard path with a six-figure job and keeping up with the Joneses but waiting to take a breath and enjoy life. After finding FI, she realized the money was no longer the goal but simply a tool.
• Kristi has been connected with Big ERN, from Early Retirement Now, and over several conversations, they discuss Employee Stock Purchase Plans, 401K contribution strategies, the phase of retirement, and more.
• While wealth accumulation is simple math, decumulation is more complicated so Big ERN created the ultimate safe withdrawal rate series.
• Some recent changes Kristi has made to her investments since starting her path to FI are moving from a Roth 401K to a traditional 401K and maxing her contributions out. She also moved her current balance and future contributions out of target retirement date fund and into an S&P 500 fund.
• While Kristi has the option to self-manage her 401K in a Schwab account which would give her access to a total stock market fund, Big ERN doesn't believe that the difference between it and an S&P 500 fund is minor. Expense ratios are a more important consideration. Moving from a 0.2% expense ratio to a 0.02% might be worthwhile, but leaving the money where it is fine when the difference is 0.01% unless it is an in-kind transfer or a quick process. Human Resources may know how long the process is likely to take.
• Kristi approached her HR department about making after-tax contributions so that she could do a mega-backdoor Roth conversion, but the HR department was not clear on how much she would be allowed to contribute. She found the ChooseFI community to be quite helpful for bouncing ideas off of.
• She's also interested in her company's Employee Stock Purchase Plan (ESPP). The advantage of it is that she can purchase stock at a 15% discount, but she will pay taxes on the discount and be required to hold the stock for two years.
• Such a purchase gives her investment a 5% per year boost, however, there's no diversification in purchasing company stock. Kristi's income, bonuses, and employment are all already tied to her company. That being said, Being ERN says he would probably still do the ESPP, although he would only keep two year's worth of money in the plan and then pull it out. After taking it out, it will be subject to long-term capital gains.
• The ESPP may have contribution limits, in which case she should make the additional contributions to her 401K and then do the backdoor Roth conversions.
• Big ERN likes to say don't let the tail wag the dog, meaning that asset allocation and expected returns should be the primary concern before tax considerations.
• Kristi has a difficult time determining exactly how much to contribute as her company does it by percentage and how bonuses are paid out. If she overshoots it, she could miss out on the company match in the last month of two of the year. Big ERN says some companies will do a true-up, or another HR term, where they will still contribute the match.
• Some who have access to a true-up prefer to contribute the maximum to their 401K at the beginning of the year so that their money is in the market longer.
• Those without a true-up need to be careful. Big ERN suggested Kristi could look at the minimum and maximum of her salary and bonuses to come up with a range. $19,500 divided by her maximum would give her a rough percentage to start the year with. Toward the end of the year, she will need to look at it again and make adjustments.
• Kristi also asked about Big ERN's thoughts on the stages of retirement, but she is most interested in the early retirement phase.
• Retirement is an uneven path. Health expenses may be higher before Medicare kicks in and there will be a boost of income once Social Security is received. How do you structure your withdrawals? What are the tax aspects? Which accounts do you tap into first? And what should the assist allocation be?
• Big ERN doesn't recommend 100% equities for people in retirement. 75% stocks and 25% bonds is a better allocation.
• Kristi will likely have to rely on more than just her taxable accounts during the early retirement phase. She could tap into her Roth IRA accounts as well which may get her to 59 1/2 when she could then begin withdrawals from her 401K tax and penalty-free.
• It's best to spread the tax liability as equally as you can due to our progressive tax system. Although trying to optimize taxes is important, safe withdrawal rate and asset allocation are significantly more so. Not all of the withdrawals in retirement are taxable. Some of the withdraw money is principal, which taxes were already paid on.
• Good tax planning versus alright tax planning in retirement probably doesn't make a significant difference.
• Kristi was also curious about when contributing to taxable accounts might be advantageous over continuing to fund retirement accounts for those who want to retire early. Big ERN thinks what there are cases when it might make sense, but for most people who can assume they will be in a lower tax bracket in retirement, it's better to fund retirement accounts.
• Previously, Big ERN had provided Kristi with a spreadsheet to use for determining cash flow issues before she turns 59 1/2 and model Roth 401K conversions.
• Kristi says that she has been participating in her company ESPP but hadn't sold any of the company stock until recently. She debated how much to sell and still has a lot remaining. Big ERN suggests that she could sell over a period of time to avoid any regret that might occur with a large price increase. However, there could be commissions associated with selling. As long as she's held it for more than two years, it's all subjective to long-term capital gains or will help with tax-loss harvesting. Low-cost shares with the highest capital gains should be deferred as long as possible.
• A little tax-arbitrage is the sell the investments with the highest cost-basis and lowest tax bill.
• Big ERN mentions that a lot of people have loss aversion but sometimes it's best to cut your losses, let it go, and take the tax benefit.
• Kristi has concerns about HSA rules changing after she's stashed all that money away and paying out-of-pocket for medical expenses. HSAs, however, have a triple tax benefit. there are no taxes paid on contributions, the money grows tax-free and comes out tax-free as long as it's used toward qualified medical expenses.
• HSA participants can save their receipts and allow the money to grow. Current or previous years' health expenses may be submitted for reimbursement.
• In the United States, rules tend to be backdated, so that if HSA rules do change in the future, the old rules will likely still apply to the contributions. Still, Big ERN suggests not letting the HSA grow to more than 15% of total net worth.
• It's important to note that not all target-date funds are the same. The closer the retirement date, the more conservative the fund is going to be. For most people, a total stock market or S&P 500 fund with a low expense ratio is good enough.
• Taxes shouldn't drive decision making. Make the best moves that impact you over the long-term. Buying a house for the mortgage interest deduction makes no sense for most people with the new higher standard deduction.
• When it comes to tax deductions, the point isn't o get a deduction just to get a deduction, it's to bring home more income

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Take control and build your plan for financial independence today with NewRetirement and get 14 days for free
• ChooseFI Episode 221 Introducing Our Households of FI!! Part 1
• ChooseFI Episode 224 Introducing Our Households of FI!! Part 2
• Early Retirement Now
• Check out ChooseFI's review of the Chase Freedom Flex card
• Invest in low-cost broad based index funds with M1 Finance
• ChooseFI Episode 035 Sequence of Return Risk | Early Retirement Now
• ChooseFI Episode 019 JL Collins The Stock Series Part 1
• Is an Employee Stock Purchase Plan (ESPP) Better than a Retirement Account?
• Get on our email list and start on your own path to financial independence

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Brad has been taking part in a mastermind group and teaching its members about financial independence. While they understood the “Why of FI”, how to get started wasn't as clear. The Back to Basics series of episodes covers just that, how to get started on the path to FI.
• The journey to financial independence is not about deprivation. It is about a life of personal choice and abundance. Its starts with understanding your “why” and then setting goals for the next 5, 10, or 15 years.
• There's a difference between the money you need to pay bills and meet basic needs and discretionary spending. Understanding how much your lifestyle costs is the first step.
• It can be psychologically difficult to do this first step. It may reveal mistakes, but it's important to be honest with yourself and not beat yourself up over them. We all make mistakes.
• After knowing what your life costs, what comes next? To calculate your FI number based on your current lifestyle, multiply your monthly expenses by 12 to get your annual expenses. This is how much money you will need each and every year in retirement to cover your expenses.
• The 4% Rule of Thumb suggests that you can withdraw 4% from your total assets each year to live on and reasonably expect the money to last for the remainder of your life. For example, if you have $1 million in assets, 4% of it is $40,000 that you could withdraw each year. The 4% withdraw rate is adjusted for inflation.
• To get to your FI number, multiply your annual expenses by 25. $40,000 multiplied by 25 is $1 million. $80,000 in annual expenses, multiplied by 25, results in a FI number of $2 million.
• Whether starting with a net worth of zero or with some assets, the next step would be determining your current path to your FI number.
• The point of saving money is not for it to be finally used for a retirement far off in the future. Save to reclaim decades of your life when you can spend time as you see fit. Reframing the goal of saving allows you to reorient and see that saving money is investing in your time.
• One of the reasons Brad and Jonathan enjoy board games so much may have parallels with financial independence. Both involve iteration and getting better and better at making smarter decisions through gamification.
• People who win games the most have an intermediate mindset. They understand the limitations balanced with longterm thinking.
• When looking at income, what is the bare minimum needed to cover your expenses? For a married couple living in Virginia spending $80,000 a year on expenses, they will need to earn an income of $102,000 before taxes and without contributing to savings or retirement. They would pay $9,000 in federal taxes, $5,000 in state taxes, and roughly $8,000 in FICA (social security and medicare taxes), for a total of $22,000 in taxes.
• When income and expenses are exactly the same, you can never afford to retire. How do you create some space between the two?
• Expenses are not always fixed. Cars loans come to the end of their terms and student loans are paid off. Add in some cuts to a few other line items in your budget and you might find an extra $1,000. How might that change things?
• Cutting $1,000 from your monthly expenses reduces your annual expenses and subsequently your FI number by a whopping $300,000.
• What should you do with that extra $1,000 a month? Putting that savings into a 401K allows that money to begin working for you.
• In addition, the $1,000 a month going into a 401K becomes a tax deduction and reduces your federal income tax. For the couple in the previous example earning $102,000 per year and bringing home $80,000 after taxes, contributing $12,000 to a 401K doesn't mean they have $12,000 less to spend. With the tax advantages of contributing to a 401K, they will bring home $70,000, only reducing their take-home pay by $10,000. They saved $2,000 in taxes. Since they already have enough money to meet their expenses, that extra $2,000 saved in taxes could go toward a Roth IRA.
• Part 3 in the Back to Basics series will talk about optimization on both the income and expenses side of things.
• Our hypothetical couple, starting with a zero net worth, after investing $1,167 a month (totaling $14,000 per year) at an average 8% rate of return, will hit their FI number of $1.7 million in 30 years.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• ChooseFI Episode 257 Back to Basics: Getting Started With FI Part 1
• ChooseFI Episode 132R Insurance | A Framework
• Easily compare and buy life insurance with PolicyGenius
• Get started on Fundrise with no advisory fees for 90 days
• Smartasset.com
• ChooseFI's financial calculators
• Learn how to get started on your path to financial independence at ChooseFI.com/start

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• In this ChooseFI Back to Basics episode, we review Health Savings Accounts (HSA). What happens when you need to finally pull money out after funding it year after year?
• ChooseFI Chief Content Officer, MK, is just weeks away from having her baby. For years, she and her husband, Jason, have been funding separate HSA accounts without making any withdrawals.
• They now contribute to a family plan HSA and decided it was a good time to test out how complicated the process was to withdraw HSA funds.
• They discovered some plans are easier than others. The process of withdrawing funds from the fund MK had rolled over to Fidelity was super easy. Jason's was a bit more tricky due to the Health Insurance Portability Accountability Act (HIPPA) compliance laws and auto-reinvest settings. Now that they tested it out, they feel confident they will know what to do in the future.
• An HSA is a type of investment vehicle that gives you a tax deduction in the current year and helps pay for healthcare-related expenses.
• Only those participating in qualified in high-deductible healthcare plans are eligible for HSAs. For 2020, the IRS defines a high-deductible plan as one with a deductible of $1,400 for an individual, or $2,800 for a family. the maximum a family may contribute in 2020 is $7,100, and half of that for an individual.
• The money going into the account isn't subject to income tax and sits in the HSA account until you submit for reimbursement of healthcare expenses. HSA withdrawals for healthcare expenses are also tax-free.The benefit of an HSA is that the money can build and grow over time. Healthcare expenses do not need to be submitted for reimbursement as they are incurred. HSA participants can pay out-of-pocket and wait for years before requesting reimbursement if they choose to.
• The IRS criteria dos state that the high-deductible plan must be a qualified plan. Check with your company's human resources department to determine if your plan is a qualified one.
• HSA participants should also understand who their plan is with, what investment options they have, and what the fees are. Based on fees, Fidelity and Lively are two good providers who offer low-cost, board-based investment fund options.
• The goal is to cash flow medical expenses in your younger years when they are generally lower, funding the HSA with pre-tax dollars and allow them to grow until later in life when healthcare costs begin to increase.
• There may be additional tax benefits from using your employer's HSA provider rather than Fidelity or Lively.
• Because you can submit for reimbursement years after the expense was incurred, save your receipts. Brad has a Google doc that lists all of the healthcare expenses he pays out-of-pocket and saves a pdf of the receipt in his Google Drive account.
• Even if your provider offers a way to upload receipts, you should always maintain your own records and only use the provider's system as a secondary backup. If you change HSA, you could lose your receipts.
• It is your responsibility to verify to the IRS that you've been using the funds in the HSA appropriately. It makes it easier if you have all of that information maintained in your own cloud-based account.
• After several years or decades of cash-flowing healthcare, it may be possible to have tens of thousands of dollars of reimbursable expenses that are accessible anytime, tax, and penalty-free whenever it is needed.
• The final episode in round one of the Households of FI series airs next week. Throughout this series, ChooseFI follows eight diverse households at different points on their path to FI.
• More exciting news for ChooseFi is the website redesign, expected to launch in the coming weeks. The new website format was designed with your experience and journey to financial independence in mind. The content on the site has been curated so that people looking for specific content can easily find what they are looking for.
• If you would like to receive a notification when the new website has been launched, go to ChooseFI.com/subscribe and an email will be sent to you when it's ready.
• Brad recently gave a presentation to Dominick Quartuccio's Do Inner Work mastermind group on the Why of FI. Though people seemed to understand the why of FI, there were questions regarding how to get to FI.
• How does someone go about getting started? It starts with visualizing where you want to be in 10-15 years, what your goals, and what kind of options you'd like to have.
• If Brad were to go back to when he began his journey, he would have said that there's got to be more to life than what he's experiencing. Life was comfortable, but it felt like Groundhog Day. He could see himself doing it for the rest of his life.
• The second task when starting on the path to FI is to take an assessment of what your life actually costs. What you earn minus what you spend, equals the gap, or the amount of money you have left to work with.
• Adding up your structural expenses, recurring monthly bills, unplanned expenses, and then looking at all the little discretionary expenses can be a difficult task. No one should beat themselves up over it.
• Once added all together, you have a realistic estimate of what your life actually costs. It's not complicated math.
• ChooseFI Episode 258 airing on Monday will tackle the other side of the equation, the gap, and discover how to affect the outcome.
• It's the first anniversary of the release of ChooseFI's book! To celebrate, we're giving away the first chapter for free when you go to ChooseFI.com/book.
• The weekly book giveaways are back! Winners will be selected from response to Brad's newsletter call for FI wins. This week's winner is Belinda. After tracking her spending for three months, she made a budget and reduced her family's food budget by $900 a month. She's also funding her Vanguard account $500 a month, refinanced her car loan, her husband maxed out his 401K, and she hopes to max out her SEP IRA. She says having control of their money is giving them power back over their lives.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Protect your online activity with ExpressVPN and get an extra 3 months free.
• Find your own unique path to FI with NewRetirement.
• Get notified when the new ChooseFI website launches!
• Dominick Quartuccio's Do Inner Work mastermind group
• ChooseFI Episode 038 The Why of FI
• ChooseFI Episode 100 Welcome to the FI Community
• Get the first Chapter of ChooseFI: Your Blueprint For Financial Independence for free!

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• How can you recognize the value in the secondhand market, begin optimizing a strategy, and turn it into income? Today's guests, Rob and Melissa Stephenson, the Flea Market Flippers, have built a six-figure business flipping the bargains they find.
• Rob spent weekends as a child with his parents visiting yard sales. They bought items and then listed them for sale to a bigger market using the newspaper classified section. Rob followed in their footsteps, flipping items as another side job without realizing the full potential of it.
• Selling used items is no longer a local market. With the launch sites like eBay with 181 million users, the whole world becomes the market.
• Rob and Melissa's business model capitalizes on larger items, such as commercial exercise equipment or restaurant equipment. They find the items locally from establishments going out of business. They look for the higher retail items which will make them a lot of money. It helps them to work less and make more profit. From their 89 sales last year, they made $80,000.
• For example, over the summer, they found a 40-inch range that retailed for $4,500. They bought it for $200, brought it home, then sold on eBay for $2,800.
• Over the last five years, Rob and Melissa have honed their freight skills and can ship very large and heavy items for reasonable prices.
• While they have become comfortable shipping large items, Rob and Melissa want people to start where they are at. Start with the items in your house, learn the system, how to take photos, how to sell on eBay to slowly build your confidence.
• The majority of the time, they research an item before buying it. Some things do sell quickly, but other items need time for the right buyer to find them before they sell.
• There are skill sets involved that make flipping items work: finding the deals, researching prices, making offers, marketing, taking good photos, and shipping. However, Melissa says it's actually a really simple business.
• There are lots of options for finding items, but Rob's favorite apps are Facebook Marketplace and OfferUp. He will scroll through them for ten minutes while sitting in his LazyBoy at night.
• There are fewer risks than there were several years ago. Smartphones have made it possible to jump onto eBay to check everything for the last 30-60 days that has sold. It's similar to the MLS with the housing market and looking for comparable properties that recently sold.
• If you can't find it on eBay, a good rule of thumb for items in good condition is 50% off retail.
• They no longer do many actions on eBay, opting for Buy It Now and listing for the price they want.
• Since you can see what an item has sold for the in past, if you want to sell it quickly you can just price it a little bit lower than that.
• Rob and Melissa sell 85% of their items on eBay and the rest on Facebook Marketplace. They usually cross-post items but eBay is consistently a winner.
• Fees on eBay are 13%. PayPal processing is 3% and 10% goes to eBay. They believe the opportunity to sell to a larger audience is worth the fee.
• Taking good pictures is important, with clean photos and nothing in the background. Fancy photography equipment isn't required. They still use their iPhones for everything. Since eBay allows up to 12 photos, you should use all 12 photos.
• The title for the item is the most important since eBay is essentially a search engine and the searches will come up on Google too.
• Descriptions are less important and Rob likes to underpromise and overdeliver so people have realistic expectations.
• Since they already have a good idea of how much it going to cost, they build it into the item cost and offer free shipping. It helps items to sell more quickly and reduce emailing back and forth with the buyer.
• Rob and Melissa love what they do and already feel like they are retired even if they haven't hit their FI number. Rob spend about 20-25 hours a week on their flipping business.
• They both like to travel and have a goal of being able to pay for the trip by flipping while on the road.
• Flipping is something Rob and Melissa are so passionate about that they teach a course. They have two groups they've been teaching, one with no experience flipping, and another group of experienced flippers looking to go freight.
• Rob and Melissa offer a webinar, which can be found at ChooseFI.com/flip, and a paid course.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Get an increased bonus of 80,000 Ultimate Rewards points with the Chase Sapphire Preferred
• Improve your writing skills and get a 20% discount on Grammarly Premium
• Check out Rob and Melissa's webinar

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Picking back up with the Household of FI series, Vivian is a single mom who found FI in the last year, but initially, it seemed impossible. It wasn't until she was introduced to the ChooseFI podcast and saw real people reaching financial independence that she believed she could do it too.
• Vivian has been dealing with a number of challenges: a cancer diagnosis, a child custody battle, and caring for parents who have no savings of their own.
• As a pharmacist, she earns a significant income. She's already managed to pay off $300,000 in student loans in six years and believes she can save $60,000 a year.
• Vivian has been paired with mentor, Leslie Tayne, also a single mom and attorney who helps people with debt relief.
• Leslie acknowledges that what Vivian is going through with her separation is one the most challenging times in her life and it is a very emotional experience along with being financially damaging. However, there is a light on the other side and she will come out with more freedom and more control.
• Because her significant other's mom used to watch her child while she was a work, childcare is a challenge right now. Childcare is expensive and not something you can find discounts on.
• As an attorney, Leslie helps her clients to fix their financial messes without judgment. She doesn't believe in a debt-free life since life has its ups and downs. Instead, it's okay if being debt-free is not realistic. We should learn to embrace our debt but what is important is how you manage the debt.
• Due to the separation, Vivian will be selling the house that is entirely in her name. If she makes a profit, she should talk to her tax preparer about qualifying for a capital gains exemption.
• Vivian is also interested in ways to save for her child's college education to which Leslie offers several options: contributing to a 529 plan, a state pre-pay program, or a regular savings account.
• There are tax advantages to contributing to a 529 plan over a savings account and should Vivian's child decide to not go to school, the money in the 529 plan may be used for grandchildren or withdrawn with earnings taxed at regular income tax rates.
• The Texas pre-pay option would allow Vivian to lock in current undergraduate tuition rates and required fees.
• When it comes to budgeting for groceries, Leslie says that her family mostly eats at home and orders out just once a week. One trick to not overspending at the grocery store is not to take the children with you, shop with a list, don't allow yourself to get distracted, and buy non-perishables in bulk.
• When you have no choice but to bring your child with you, you can allow them to pick one item so that they can pick something they want without filling your cart with everything they want. It limits your financial exposure when shopping.
• While eating out, rather than order a kid's meal, share bites of your own meal, and develop a taste for adult foods.
• Vivian's daughter is not yet attending pre-K schooling, due to the virus but may be able to find reasonably-priced options that give her the option to socialize.
• Because her significant other has not been cooperative during their separation, all of the attorney costs and other fees have gotten be very expensive. Vivian needs to be as cooperative as possible to limit her financial exposure.
• Leslie says a good piece of advice is don't marry or get involved with anyone you don't want to be divorced from.
• It's often advisable to keep finances separate in a relationship and protect any assets with a prenup or postnup because it is very tricky to untangle them should the relationship end.
• Everyone should look at what deciding to combine finances in a relationship really means and how it impacts things.
• Brad reviewed the capital gains tax question and said because Vivian has lived there for at least two of the last five years, she would be eligible for up to $250,000 in capital gains tax exclusion.
• The decisions being made should be ones that will make life better over the long-term. Brad's goal is to set the groundwork for a successful life.
• Jonathan notes that Vivian doesn't appear to have an issue with her savings rate, instead, she may be at risk of slipping into a deprivation state. To fight this urge, Brad believes we need to have a better idea of what the path looks like for her.
• As ChooseFI follows Vivian during this study, she will need to better understand her expenses and her FI number. She needs to have a sense of where she is to know where she is going.
• ChooseFI recognizes that some audience members are just finding and joining us now. ChooseFI is building out a curated path to help you figure out where you are and what information will serve you best. Sign up to receive this information and more at ChooseFI.com/start.

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• Building a business online has never been easier than right now, but Corbett Barr was forging his path in the early 2000s when it was hard. We're diving into his origin story to learn what gave him motivation and why he believed entrepreneurship was for him.
• Working as a consultant in Fortune 500 companies, Corbett had the kind of job a lot of people really wanted and could build a career around. Though he wasn't aware of financial independence at the time, he didn't want to climb the ladder only to find it had been leaning up against the wrong wall.
• Unhappy with his career, he was nudged toward entrepreneurship but was scared to take the leap until a friend asked if he wanted to become involved in a new project, which he was able to do without risking any of his own money.
• In his early 20s, Corbett was furloughed from his job during the 2000-01 financial crisis. During his efforts to stay afloat, he was ashamed and learned how important it is to save as much as possible. His savings gave him enough of a cushion to last a year or so in order to find out if he had what it takes to be an entrepreneur.
• His picture of entrepreneurship at the time was working yourself to the bone, sleeping under your desk, and hitting a home run before earning a bunch of money and doing whatever he wanted. But he found that he still had a host people he still needed to answer to and felt even more trapped than if he were an employee.
• After putting in so much time, effort, and money, it was painful to realize he didn't have much to show for it. But after having a taste of entrepreneurship, it was hard to imagine going back.
• Rather than jump into another project, Corbett and his wife took an eight-month sabbatical in Mexico to clear his head, reset and pivot.
• The Mexican sabbatical allowed him to put some space between himself and the friends, family, and San Francisco venture capitalists influencing his life to see that something else was possible.
• It was around that time he discovered concepts of location, independence, lifestyle design, and digital nomads. He realized that perhaps what he wanted wasn't to be wealthy, but instead to have enough time and control to do the things he wanted, like working on the things he wanted or spending time with friends and family.
• When discussing the dark side of entrepreneurship, Corbett says we don't often see the path of destructions can leave in people's lives. However, it has become much more democratized in recent years where you don't have to take investment money or big-name advertisers. It allows you to really be in control and think about how you go about doing it.
• Though he originally envisioned building a product and then finding customers who wanted it, he decided to go with an audience first business where he would find customers who wanted a product he would then build for them. An audience first strategy ends up taking a lot of the risk out of things.
• In the beginning stages of entrepreneurship, it's all about finding your topic and what you are going o building toward. It's good to jump into something you are interested in and can become good at. It can take experimentation and doesn't necessarily come overnight.
• Something that Corbett teaches is “minimum viable income” where you cut back all of the fat. Though he jumped in with both feet and lived off savings, people like Brad did things on the side. And adding an extra thousand or two in income through a side project, it can change the entire trajectory in terms of FI.
• Some of Corbett's observations about working for yourself are: you have no one to blame but you, when you work for yourself, you don't have to worry about a new boss, you decide when you work and when you don't, no pointless, actionless meetings, no cubicles, and the coffee is amazing.
• When living a nomadic lifestyle, Corbett and his wife consider the total annual cost of their home base, including any rent they might receive back. Some locations are better than others, so you may need to get creative about it.
• In 2009, when Corbett began building his audience first business, he began with free ebooks on affiliate marketing, followed by an online course, and then another, and another. He began to realize that he wanted to layer coaching and community on it. He's been doing that through Fizzle since 2012, along with a podcast.
• Free consultations are a great way to understand what questions your audience has and then build it into your product. There are ways to ease into charging for the product you are creating to find out if it's viable.

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• Going back to the basics of ChooseFI being a crowdsourced show, Brad and Jonathan address what's going on in the FI community with a wild card Friday episode.
• Why revisit content that's already been discussed? After several years of introducing new ideas, the ChooseFI audience may be in a different place financially and ready for a refresher on some of the more advanced concepts presented earlier in the show's history. And newer listeners may not have combed through the archives and missed out on topics relevant to their situation. This episode back to basics provides an orientation of what ChooseFI hopes to deliver.
• Goals for the podcast are to introduce a new idea or story during the Monday episode. But not every strategy or tactic works for everyone. Friday's Roundup episode looks at that idea from different perspectives, incorporates audience feedback, and seeks to answer additional questions.
• The FI Weekly is the email Brad sends out every Tuesday where he provides subscribers with ideas to ponder, inspire, and motivate people on their own journey and shares what actions he is taking to make his life a little bit better. Opt in to receive Brad's email, The FI Weekly, at ChooseFI.com/start.
• Financial independence means different things to different people. For Jonathan, it means he has options allowing him to choose what he does during the best years of his life. For Brad, it means freedom, giving him the ability to live life on his terms, spending time with his family.
• Pursuing financial independence doesn't mean living a life of deprivation. It's about choice. No one should tell you how to spend your time, your freedom, or what to spend your money on. You have the freedom to spend money on an expensive car if you choose, as long as you understand the impact of that decision.
• It's not even about being at financial independence or not. Simply being on the path to FI gives you options. Whether you're in a toxic situation at work or want to pursue a passion project, just working toward FI gives you options those on the standard path cannot afford to take.
• Sharing stories from the community and discussing the decisions they have made broadens and brings to light the scope of options available to the variety of personal challenges you may have.
• The pursuit of financial independence is not necessarily about hitting that FI number. It's a life optimization strategy.
• If you are working in a low-wage job and don't see the path, you can be trained in a new industry and be making $60-80K within six months. Check out the Talent Stacker podcast.
• Shane recently posted in the ChooseFI Facebook Group, “I'm a recent college graduate, 23 years old. What advice would you give yourself when you were my age regarding investments, retirement/401K, and student loans? I want to invest, but I also have about $30,000 worth of student debt, but I'm only making around $41,000 a year.”
• Brad notes that a lot of people like Shane are looking for tips or special advice that will get them to financial success, but that there's nothing complex about it. It comes down to savings rate and time.
• Increasing savings rate is easier when you reduce your structural expenses. If your life doesn't cost much, you can increase your savings.
• When first starting out, Brad and Laura weren't making high salaries, but they set themselves up for success by moving to a city with a lower cost of living, purchased a home with a reasonable mortgage, and have driven the same car since 2003. These choices allowed them to have a 50% savings rate and meant if Laura decided to stop working once they had kids, they would be fine.
• Brad and Laura became wealthy because they didn't care about looking wealthy.
• With some quick math, Jonathan calculates for Shane to have a 50% savings rate, his monthly expenses will need to be $1,700 a month. With a mortgage and expensive car payment, that may be difficult. He might do well trying something like house hacking.
• Shane could purchase 4 bedroom house, rent out rooms to friends and cut his housing expenses down to $300 a month.
• 40% of most people's expenses go to housing and transportation. Optimizing in just those two high-cost areas can make a huge difference in your savings rate.
• Anchoring yourself to a food budget of $2 per person per meal per day in another way to reduce a major expense category. Laura sits down once a week to plan out several meals for the week, making enough to have as leftovers on a second night. The meals she cooks average that $2 per person per meal goal which helps them save over $1,000 on eating out and picking up convenience foods at the grocery store.
• A rough target for housing expenses is 25% of your take home pay.
• For investing, Brad recommends Shane begin with low-cost index fund investing and JL Collins' book The Simple Path to Wealth.

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• ChooseFI Episode 016 House Hacking with Coach Carson
• ChooseFI Episode 148R Expense Ratios and House Hacking
• ChooseFI Episode 022 The Ultimate Guide to the True Cost of Car Ownership
• Download ChooseFI's $2 per person per meal cookbook
• ChooseFI Episode 023 Career Hacking with ESI Money
• ChooseFI Episode 211 How to Negotiate Your Salary Without Burning Bridges with The Financial Mechanic
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• JLCollinsnh.com
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• Everyone's path to FI is going to look a little bit different and there is so much we can learn from each other. Hoping to inspire and share lessons learned through conversations with community members, Brad and Jonathan speak with Julia Harder, an active duty member of the Coast Guard, is already well on her path to FI.
• Always a natural saver, Julia was influenced by her dad, who stressed the importance of investing, and Dave Ramsey's teachings that debt is bad. She was on a good financial path, yet she still felt something was missing.
• Though it sounds counterintuitive, Julia's path to financial independence began with divorce. Prioritization to her marriage, she rarely spent money on anything she didn't absolutely need. During her marriage, her husband helped her learn that some spending can be a good thing. Unfortunately, he was an irresponsible spender and there were months Julia found she couldn't pay all of the bills.
• Although she knew something was wrong, she failed to listen to her instincts and all of the red flags that kept popping up. she just assumed everything would be okay rather than taking a step back and thinking about it critically.
• Following her divorce, she was left with a $300,000 mortgage, a $20,000 car loan, no savings, and was feeling like she had hit rock bottom financially. Following Dave Ramsey's advice, Julia began to follow his steps to get back on her feet and find herself and her financial objectives again.
• Julia was all in on Dave Ramsey's strategies. She cut up her credit cards, began using cash for everything, and made a budget every month. It gave her discipline and solidified her habits.
• She found ChooseFI in May 2019 after she began teaching personal finance to other members of her Coast Guard unit. The thought of optimizing investments and taxes really caught her attention. It was exciting to begin taking action to optimize her money in these areas as well.
• It was more difficult to come around with respect to travel rewards credit cards, but because she had learned to be disciplined with her budget, she could spend money on a rewards credit card and begin optimizing her travel spending too.
• Before ChooseFI, Julia thought she was killing it with her 15% savings rate. She assumed 59 and a half was the earliest she could retire because that's the age her finical advisors had given her. She was blown away when a ChooseFI guest discussed their 70% savings rate. It was then that she realized she could control so much more than current her zone of awareness concerning savings and retirement.
• Julia plans on remaining in the Coast Guard until eligible for a pension at 20 years of service. While others often ask if she'll be bored, she has a list of passion projects she can't wait to pursue without having to worry about how to pay the bills.
• As someone who always enjoyed public speaking, last Fall, she took up book narration after reaching out to a friend with audio experience for help getting started. She's also joined Jonathon's Talent Stacker class and looking to start a podcast.
• Julia keeps a list of all the things she wants to accomplish and FI will give her the freedom to pursue them without being obligated to a job or other people's expectations.
• Between Julia's pension, TSP, Roth IRA, and a taxable brokerage account, she plans to hit Fat FI in 2027 when she becomes eligible for her pension.
• Calculating a FI number with a pension is a bit different than multiplying annual expenses by 25. Julia estimated her pension using the military's pension calculator. She multiplied the difference between her pension and her expenses to calculate her FI number.
• While she still follows the tenants of Dave Ramsey's Baby Steps and has met the minimum standards, she believes she has moved on from the standard path of working for 40 years and is more in line with ChooseFI.
• Jonathon stressed that like Julia, members of the military with a pension, the Roth Conversion Ladder is not going to be a good option since it requires a few years with little to no income.
• When exploring the idea of a talent stack, some people may have a difficult time identifying what they are really good at. It might start with identifying a pattern in what others tell you you are good at.

To watch the video highlights, click on ChooseFI.com/252

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• Get “unstuck” with Jillian Johnsrud and the Everyday Courage podcast
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• Martin and Ayesha are both natural savers who have been great about living below their means but lacked a real plan. Their goals are to maximize investments for retirement and finding ways to utilize dividend funds.
• After stumbling across the ChooseFI podcast, they felt like their financial independence number and retirement seemed obtainable which has helped push them to commit and make even bigger changes.
• While Martin and Ayesha had a 20-25% savings rate before finding FI, Brad commended them on what a great job they were doing. He also stressed that FI is about living a better life and having the financial security to get you there, not what your savings rate is.
• Despite the inclination to save, Ayesha always resisted the thought of meticulousness and restrictive budgets. However, she found that she could get behind the idea of focusing on spending on what they truly valued, so they began using Personal Capital as a less obtrusive method of tracking their spending and gaining insight into their habits.
• Something that Martin and Ayesha place considerable value on are experiences, particularly travel, spending time with friends and family, and being healthy. Instead of getting together at restaurants and spending money on pricey meals out, they began hosting monthly potlucks.
• Ayesha has found the website Budget Bytes to be incredibly economical when it comes to low-cost recipes and efficient for discovering uses for the ingredients she already has in her refrigerator. It's helped to cut their grocery bill to around $600 per month for their family of 4.
• Due to quarantine restrictions, Ayesha was out of work for months, which she calls a blessing in disguise. During that free time, they were able to take a deep dive into their spending and immediately saved $500. It also allowed them to slow down and spend more time with family enjoying the outdoors, playing games, and eating all three meals together.
• Following the time off from work, Ayesha has realized that it does cause her some stress which made her want to buy things. It also strengthened her conviction to reduce her workload within 5 years to perhaps just one day a week so that she can find more joy in the moment.
• Although Martin enjoyed his two-hour daily commute, working from home during the pandemic has made him more aware of the importance of time. He now strives to make the most of his time and focus on using it in ways that bring him the most value.
• While their monthly expenses are not constant because life is lumpy, it runs around $3,500 but can go as high as $5,000 a month when home repairs are needed.
• Martin and Ayesha have a goal of reaching FI in seven years and are looking at exploring several different options to help get them there.
• With option one, they would withdraw money from an investment account to pay off the mortgage on their home. The money saved on the mortgage payment would then be invested for the next seven years.
• In option two, they would use their investment account to pay off half of the remaining mortgage and continue to make the monthly mortgage payments which result in a mortgage pay off in seven years.
• Their third option is to refinance their current mortgage which has 17 years left at 3.3% interest rate to a 15-year loan at 2.6%, but that refinance incurs $7,000 in fees. The payments would remain the same, but the home would be paid off two years earlier.
• Ayesha likes the idea of not having a mortgage but doesn't want to do it if the numbers don't make sense. However, Martin is okay with a lower net worth if it means they can get rid of their mortgage because he feels they would have more options.
• Brad admits this is an issue he and many others in the FI community struggle with. With such low-interest rates on mortgages, it's almost always a better option mathematically to keep the money invested, but it doesn't mean it's the right decision for everyone. The psychological aspect needs to be considered.
• If they would like to pay the mortgage off in seven years, the best thing they can do it to use an amortization calculator and see how much extra they will need to pay each month to have the mortgage paid off in seven years. Martin and Ayesha can then see how that payment fits into their current lifestyle.
• As a fourth option, Brad pointed out that they can drastically reduce their FI number if they were to pay off their mortgage. With a FI estimate of 1.25 million, using the 4% rule, they would have $4,000 per month. If the mortgage was paid off, they could reduce their monthly expenses by $1,600, and then their FI number is only $750,000.
• After living through the 2008 housing market crash and not having a plan, and then this most recent market downturn, Martin and Ayesha have realized they may not be as risk-tolerant as they used to believe. Brad suggested having an investor policy statement that they've written down to help them stay the course in times of uncertainty.
• The biggest takeaway is the being on the path to FI gives you options when you have the freedom and flexibility to create a plan that works to meet your goals and live a better life, even if it isn't always mathematically optimized.
• It's a common problem to be overwhelmed with all the information we consume about optimizing various aspects of our lives that we end up with analysis paralysis. It's important to remember that we're trying to live better lives. They don't have to perfect or 100% optimized.
• One final concern Martin and Ayesha have is funding their children's education. Brad admits it may be wishful thinking that the higher education system goes through some sort of dramatic change in the coming years, but he and Laura consider paying $50,000 a year for college to be unpalatable and have stopped putting money into their girls' 529 accounts. Instead, they have tried to normalize the conversation about money in their house and have discussed lower-cost options for college.

To watch the video highlights, click on ChooseFI.com/251

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• Create your FI plan today at New Retirement with a free 14-day trial
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• Once you realize financial independence is possible for you, how do you ensure the money lessons you've learned are consistently passed down to future generations?
• Anne Zonca's family is well ahead of their time when it comes to financial independence. When many are focused on second-generation FI, Anne herself is third generation FI working to pass along her family's lessons to her own children.
• Children of the Great Depression, Anne's grandparents were deeply effected by having lived through it. Starting out in marriage with literally nothing, they worked hard and saved so that they never had to live through a financial situation like that again. Understanding that saving was not enough, they began investing in the stock market in the 1950s.
• With a formal education, her grandfather stayed informed with the Wall Street Journal and sharing stock tips with his brother. They invested in individual stocks, picking ones they felt were stable, like oil and gas, or utility companies. For stocks that paid dividends, they reinvested the dividends. with this strategy, they were able to build a substantial amount of wealth.
• Anne's mom recounted stories about how her grandfather got into stock investing, but Anne became more aware of her grandparents investing prowess around 14 when they began gifting stock to their children and grandchildren.
• While the value of the gifted stock wasn't necessarily a large sum, it was substantial considering they were regularly gifting to 4 children and 11 grandchildren.
• The gifted stocks were paying decent dividends, but rather than receive a lot of checks for small amounts, the dividends were all reinvested.
• Though the growth on the stocks gifted to Anne was not enough for her to reach FI, she definitely had a heart start and was learning about stocks and investing at a young age.
• Her grandparents gifting stock to the family was a win-win scenario as her grandparents did not have to sell the stock and pay capital gains on the appreciated value. Though the recipient bears a tax burden, children are entitled to a certain amount of capital gains each year tax-free.
• Currently, children can have up to $2,000 of capital gains before being subject to capital gains taxes.
• Following the example set by her grandparents, Anne's parents were able to achieve financial independence as well through entrepreneurship and real estate.
• Although preceding generations had reached financial independence, it wasn't wealth being passed on from generation to generation that got them there. It was the lessons of spending less than you make and smartly investing the extra that perpetuated generational success and wealth.
• Despite her grandparents' success in the stock market, there was remarkably little conversation about investing until the grandkids were older and showed an interest in having such conversations.
• As a result of the gifted stocks and her parents being good stewards of it for her, Anne was able to use it and graduate from college debt-free.
• As life is often bumpy, Anne experienced her own financial setback when she divorced her husband and the courts gave her ex-husband half of everything her grandparents had gifted to her. Luckily, the money lessons she had learned allowed her to be in a financial position to leave behind the marriage and move on with her life.
• Although not everything has gone fairly or smoothly since the divorce, Anne has adopted a great attitude by understanding that it's only money, she will be able to move on, and that she will still reach FI.
• The advice she would give to anyone else going through a divorce is to work with the things that are burdening you, follow your heart, and don't sacrifice your life, happiness, or the person you want to be over a bad decision. You can work hard and invest. There are still a lot of opportunities to save money, meet goals, and find love.
• Having been a stay-at-home mom and yoga teacher, Anne needed to get back into the workforce to support herself. A friend advised her to do it scared. The first year was hard, but she built up her skills and got her CPA certification renewed.
• Anne's grandparents lived long enough to begin gifting stock to their great-grandchildren, so her kids have been the fortunate recipients of these gifts and their associated money lessons.
• In addition to the stock gifts, Anne started a program of investing pocket change with her kids. Now that they are are in high school, they listen to ChooseFI with her and she's established stock accounts for them so that they can become comfortable investing in stocks and mutual funds.
• To impart a FI mindset in her children by being an example. Anne drives used cars. She also has them responsible for paying their own car insurance, which incentivizes them to get good grades to earn a discount. And she gives them some say in how Anne she invests money for them.
• Anne says financial independence means freedom. She can make decisions independent of the financial impact.
• Second, third, and fourth generations have a distinct advantage when starting out in life with the information, language, and a framework to make their path to FI easier.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Compare life insurance policy rates with PolicyGenius
• Get your copy of Raising Your Money-Savvy Family for Next Generation Financial Independence by Carol Pittner and Doug Nordman
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• Brad is back after taking August off of work as his Red X month. Though his original vacation plans were changed because of COVID, he made the best of it. They spent three weeks in Long Island visiting family, enjoying the pool, board games, and a digital detox.
• While Brad was away relaxing, Jonathan used that time to work on a couple of big passion projects. During the month of August, Jonathan created a podcast course and membership group. He also started a new podcast as a way to demonstrate to the group how you start one. The Talent Stacker podcast uses the content discussed on ChooseFI but then goes even further and fills in the holes to focus on skills, certificate programs, and career paths that don't require the high cost of college.
• The first episode of Talent Stacker has already been released and this coming Monday's episode will feature Bradley Rice where he and Jonathan discuss a carer path you can start for free with no talent stack, no career, and no experience and after 6 months of training, you can make a minimum of 60-80K with the ability to scale for an even higher income.
• The Talent Stacker membership program has lifetime guaranteed access where they will work with you to as long as it takes to get you working in that new job earning $60,000.
• Programs such as the one discussed on next Monday's Talent Stacker episode are becoming more popular with examples like Google's new career certificate program which also takes about 6 months to complete at a fraction of the cost of traditional college. The Vice President of Global Affairs at Google, Kent Walker, stated they consider the certificate to be the equivalent of a four-year degree for related roles.
• The next Households of FI family featured this week is Carol, sho found FI in 2020. In her mid-50s, Carol claims she is financially illiterate and does not want to end up being a burden to her child. Her goals are to change her deprivation mindset when it comes to money, retire with financial security, and kick her lifelong issues with credit cards. Carol was introduced to financial planner, Roger Whitney, to come up with a financial plan of attack.
• Since finding FI, Carol has jumped right in reading and listening to as much as she can. In that time, she has cut her debt in half. She believes her first steps should be to pay off debt, start an emergency fund, and begin saving aggressively for retirement. She also knows she needs a mindset shift.
• Carol struggles with budgets, but she's contributing to her 401(k) for the first time and is only giving herself a small amount of spending money with everything extra going to savings after her bills have been paid.
• Roger suggests there are two ways to tackle the mindset issue, either toughen up and do it, or set up a system to capture her excess money.
• Rather than focus on the big hill Carol needs to climb, Roger wants her to focus on what little thing she needs to do next to begin to create momentum. He also suggests that having a community like ChooseFI is great for providing encouragement, assistance, and being a virtual mentor.
• Carol wants to know which is more important paying off her credit cards or building her emergency fund. Because she's been good about not using her credit cards and they have a high-interest rate, Roger wants her to focus on paying off her cards with every extra dollar she has.
• Second, Carol should set up a system for how she manages her money. It can be helpful to have income deposited into a savings account we don't see and then transfer spending money to checking accounts at another bank.
• After paying bills and buying groceries and gas, Carol has about $200 leftover at the end of the month before she receives her commissions from sales. With her commission checks, she would like to save 50-60% of her income.
• Carol's company offers both a traditional 401(k) and a Roth 401(k), but she is unsure what the differences are. Roger explains with a traditional 401(k) contributions and growth are tax-deferred until withdrawn, while Roth 401(k) contributions are made from post-tax income and grow tax-free.
• The next two levers Carol needs to focus on are earning as much as she can in commissions which is the most effective way to make the plan work. The next lever is to hang on to the money she is earning.
• Side hustles are another area Carol is looking at to increase her earnings. She's already published two books and is working on a third, as well as looking for another side hustle.
• Since she enjoys writing, Roger suggested that Carol could share her journey on her blog and collect readers and be an inspiration.
• Mentioning that seeing her M1 Finance account grow, Roger thinks it would be useful to set up a system around that kind of excitement for continued encouragement.

To watch the video highlights, click on ChooseFI.com/249.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Freelance to Freedom by Vincent Pugliese
• Total Life Freedom
• Talent Stacker Podcast
• Google Career Certificates
• Register for The Simple StartUp Fall Challenge
• Get your copy of Raising Your Money-Savvy Family for Next Generation Financial Independence by Carol Pittner and Doug Nordman
• The Retirement Answer Man Podcast
• Rock Retirement Club
• Rock Retirement: A Simple Guide to Help You Take Control and Be More Optimistic About the Future by Roger Whitney
• The Retirement Manifesto
• M1 Finance Review

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• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• What does it look like when you are invested in building wealth, environmentalism, and sustainability? How do you combine raising your net worth while optimizing these other areas of your life? You build a holistic approach to the different types of capital.
• Laura learned about the different forms of capital through her experiences with permaculture, which is a design science that looks to nature as an example of a closed-loop, no waste system.
• Her introduction to permaculture through her gardening interest in sustainability. The permaculture flower has seven petals, with each petal representing concepts like Land in Nature, Stewardship, and The Built Environment. In addition, 12 guiding principles can be applied to each petal, such as Catch and Store Energy. She became intrigued after learning permaculture could be applied to more than just the landscape.
• Not pleased with the investing options available through her employer's retirement account investment options, Laura turned to the permaculture space around money, investing, and finances.
• Financial permaculture got off the ground around 2010-2013 where permaculture principles were applied to finances.
• While much of the thinking done early on has been at the macro level, Laura has been working to bring it down the personal finance level.
• Socially responsible investing is something that Laura does at the local level. She looks for investment opportunities in her local community, like purchasing a share in a local permaculture farm. But she recognizes local investments are few and far between, so she casts a wider net for meaningful investments outside of the stock market, like with the American Homeowner Preservation Fund which buys distressed mortgages and works to keep people in their homes.
• While it may sound like a charitable contribution, Laura is investing in these opportunities through her retirement account. Though she recognizes these investments may be riskier, she believes there are far greater risks to the environment with many other investments.
• Anyone considering investing in this way should do their due diligence and understand the risk before investing in a non-diversified portfolio.
• Laura tries to mitigate this risk using multiple forms of capital as a safety net.
• In addition to financial capital, there are material capital, intellectual capital, experiential capital, social capital, living capital, cultural capital, and spiritual capital. Other forms of capital sometimes discussed are time, health, and attention.
• Within social capital, Laura discussed communities helping each other through mutual aid societies and time banks and how they have been springing up since the pandemic began.
• Understanding these various forms of capital has shaped how Laura thinks about retirement planning. Financial capital is how we access the other forms of capital and they are where our quality of life comes from. Laura has been thinking about how to build and develop her other forms of capital so that she will require less financial capital.
• Long-term care is extremely expensive as is the insurance to cover it. Building social capital is one way to defer those long-term care costs but may not be a substitute for everyone.
• Thinking about some of these issues as a system versus a singular item brings more joy and focuses on quality of life instead of a number on a spreadsheet.
• Jonathan acknowledged that when describing his investor policy statement, he was looking at his options through the various forms of capital he has not solely his net worth and that changes his investing approach.
• Laura believes it's not necessary to have balance across all forms of capital. It may be more effective to specialize in several and looks to our networks, friends, family, and community to find who is rich in the areas where we are deficient.
• Though asset mapping, some communities may be poor in financial capital, yet wealthy in other forms which, when tapped, can be converted into financial capital.
• These forms of capital are not limited to homeowners. They are still accessible to those living a nomadic life, who are renting or not thinking about retirement yet. Community gardens, volunteering, and online communities are several ways to build capital.

To watch the video highlights, click on ChooseFI.com/248

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Get a 4-week trial, free postage, and a digital sale from Stamps.com using promo code “ChooseFI”
• Check out all the titles available from ChooseFI Publishing
• Get started on your own path to financial independence at ChooseFI.com/start

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• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Continuing the financial independence case study series, Households of FI family, Zach and Marilyn are a married couple with young kids. Using Dave Ramsey's baby steps, they no longer have any debt but have wondered what to do next. Looking to explore investing in real estate, ChooseFI connected them with real estate expert, Paula Pant.
• Though Zach and Marilyn once lived below the poverty line, they managed to pay off their debt, including student loans, a car loan, credit cards, and medical debt. During that time, they gained a little experience with buying and selling property. Since that time, Marilyn has gone back to work and their income almost doubled.
• Having earned a profit on some previous homes they flipped after living in and renovating them, it's encouraged them to use the skills they've acquired on future investment properties.
• Where they currently live in Cedar City UT, the market is a bit inflated and are concerned about the 1% rule where monthly rent should equal 1% of the total purchase price.
• Paula explains that if a property rents for 1% of the purchase price, that is 12% per year at full occupancy. Since it is estimated that operating costs will be roughly 50% of the monthly rent, 6% of the purchase price is what if leftover as an unleveraged dividend on the property. Assuming no increase in the value of the property, but keeps pace with inflation, that's roughly another 3% based on historical averages, the property gives a 6% dividend and 3% inflationary increase, for a total return of 9%. It is a rough way to determine if a property is worth looking into further
• Exceptions for the 1% rule of thumb may be made when operating costs are expected to be less than the 50% average, such as if property taxes are extremely low or if it is a newer home.
• Other exceptions to the 1% rule can also be made when buying a multi-unit home where you live in one unit and rent out the others. In those cases, personal criteria for where you want to live also come into play and the 1% rule can be thrown out the window.
• Because property values are a little inflated where they live, Zach and Marilyn are interested in buying properties in markets where they don't live. Paula believes that it's easier being an out-of-state landlord because it forced her to treat it like a business when she couldn't just pop over and take care of issues herself.
• Zach and Marilyn were also interested in what criteria they should consider regarding properties that are fixer-uppers versus being move-in ready. Paula says what she teaches the students in her real estate investing course includes a graph where on the x-axis represents a spectrum with “You Find Deals” at one end and “Your Create Deals” at the other. On the ends of the Y-axis are “Move-in Ready” and “Not Even Habitable”. There are tradeoffs between effort and reward, but as effort increases, generally, reward increases as well. If you don't have time to devote to the hardest quadrant of the graph, then it might be easier to find deals in the move-in ready quadrant instead.
• Since they are debt-free, Marilyn I feeling anxious about taking on additional mortgage debt, but Paula views the mortgage from an investment property differently from personal property. An investment property mortgage is a tool that allows you to cashflow positive.
• Paula doesn't have a specific price range she won't exceed but says there is a balance of equity to debt that she tries not to exceed across her entire rental property portfolio. She tries to keep a 50/50 ratio where for every $1 of debt she has, she also has $1 of equity which is conservative by most real estate investor standards.
• To ensure that enough funds are on hand to take care of emergency maintenance and other unexpected household repairs, Pauls advises having 3-6 months' worth of rent on hand to cover these expenses.
• Zach and Marilyn are wondering if they should cut back on retirement investments and divert to real estate to help them acquire property faster. Paula suggests instead look at how much from their overall budget they want to save and then decide how to divide up the savings.
• Considering what happened in 2008 with the real estate market, and unsure how the pandemic will impact real estate today, they are unsure when to jump in and purchase an investment property. Similar to trying to time the stock market, Paula encouraged them to look at the numbers to decide if it's a good deal right now. If in the future, the market shifts and no longer makes sense, then sell. When this is done repeatedly over a lifetime, you win.
• Since they have done well in the past with live-in flips, Paula cautioned them to be aware of their emotions and to be careful about separating what they want from a home they live in with what makes sense as a good investment.
• A 1031 Exchange allows you to avoid paying capital gains when selling an investment property and reinvest the proceeds from the sale within certain time limits in properties of like-kind and equal or greater value.
• Living in a property for two of the last five years qualifies you for a capital gains exclusion of up to $250,000 or $500,000 for couples filing jointly.
• Brad has been an out-of-state landlord like Paula for more than a year. He purchased a couple of properties in Georgia for $50-55,000. The market rent for these properties is about $750-800 so Brad is above 1% at around 1.4%.

To watch the video highlights, click on ChooseFI.com/247

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Afford Anything
• Get the FREE ebook Escape by Paula Pant
• Get your first 90 days of advisory fees waived at Fundrise
• Create a new retirement plan and get 14 days for free with NewRetirement
• Get started on your path to financial independence at ChooseFI.com/start

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• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• What happens when someone is using your finances to prevent you from making decisions that are in your own best interest? What does financial abuse look like and can you reclaim your financial life? Rachael shares her story and how she's become passionate about economic empowerment.
• Although she had a successful career and what appeared to be a healthy relationship from the outside, Rachael found herself in a relationship with someone who walked all over her.
• Slowly over time, Rachael's boyfriend began chipping away at her confidence and inserting himself into her finances, putting his name on all of the bills, linking bank accounts, opening joint accounts, and pushing to have his name on the mortgage to the property she had purchased on her own.
• Your instincts and feelings are worth paying attention to. Had Rachael explored her feelings more, she believes she would have listened to them better. Not knowing what's happening with your bills or financial accounts is a red flag. Sharing accounts is only good when both people are acting in good faith.
• The drive to take over control finances may start as a result of insecurity in the relationship, but it can take a turn and be used against the other person as a form of punishment.
• Rachael describes financial abuse as a psychological assault where your trust is so broken that it can damage the relationship you have with yourself. If you aren't making decisions willingly and freely, you are giving up bits of your power and it's then a slippery slope to giving away too much.
• There's nothing inherently wrong about merging finances but there's needs to be a conversation it.
• After 10 years, the relationship ended, Rachael found herself in a legal battle over the property, was experiencing PTSD and unable to do her job.
• The systemic assault she experienced during the relationship and in its aftermath destroyed her trust in society. All the business, government, legal, and social systems she sought help from had failed her.
• The bright light in her experience is that Rachael has now become an agent of change to have new laws passed in the UK to help other victims of financial abuse.
• Learning to tell her story and fight for herself was incredibly difficult, but also a skill-building endeavor. She channeled her anger, found her voice, and learned how to speak clearly and with confidence.
• Always a fan of journaling and understanding the power of words, Rachael started a blog as an unfiltered outlet for her feelings. The positive feedback she received from family and friends also helped build her confidence.
• Not wanting to return to teaching, Rachael attended one of Alan Donegan's PopUp Business Schools to possibly become a personal fitness trainer. When hearing about using your experiences to build an authentic business, Rachael realized she wanted to help other victims of financial abuse.
• Rachael wants to become a consultant to banks, housing associations, and lawyers and tell them what they need to do to stop financial abuse from happening, protecting both themselves and their customers.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Register for The Simple StartUp Fall Challenge
• Order your copy of Raising Your Money Savvy Family For Next Generation Financial Independence by Carol Pittner and Doug Nordman

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

To watch the video highlights, click on ChooseFI.com/245

• Matt and Megan are a dual military family on the path to FI. Matt is serving in the UK Royal Navy and Megan is serving in the US Navy, making their tax situation unique.
• Currently, they plan on having Matt get a green card, allowing him to work in the US, while Megan finishes out her Navy career to earn a pension and then move abroad in about seven years.
• Once Matt gets his green card, he will be taxed like any other US citizen. He owns an apartment in the UK that he would like to sell. Dave McKeegan notes that since there is no wealth tax in the US, Matt will not be taxed on his assets, but once he gets a green card or meets the substantial presence test, he would potentially have to pay capital gains tax on the sale of the apartment so it would be best to sell it first.
• Due to the Foreign Account Tax Compliance Act (FATCA), every bank around the world is required to report US citizen account information to the US Treasury Department. US citizens are also required to report accounts on a FinCEN 114 form and assets held overseas are subject to capital gains taxes.
• Dave wanted Matt and Megan to be aware that mutual funds held outside of the US can often be viewed as passive foreign investment companies. Any investments overseas should be US compliant as well. Vanguard has a number of retirement funds that report correctly to both the US and UK and are exempt from taxes.
• Matt and Megan are interested in how the can best take advantage of the US tax system and simplify it for themselves. To reduce their taxes, Dave advises Matt to physically give up his green card once they move abroad so that they can place money in international investments under Matt's name and he won't be taxed like he is a US citizen anymore.
• As long as their assets are less than $2 million, leaving the US will not trigger an exit tax.
• Depending on income, where their assets are held, and if they have children, their US tax filing status may change to take advantage of higher exemptions, but they should sell the UK property before filing “married filing jointly” as long as he doesn't already meet the substantial presence test.
• Matt may qualify for a tax-free UK pension when he retires from the Royal Navy but if he has a green card, he will need to pay US taxes on his pension until they move overseas and he gives up the green card.
• Dave McKeegan has moved around the world and is currently living in Costa Rica. Costa Rica is one of a number of countries that only tax sources of income earned within that country. As his business is located in the US, Dave pays US taxes. If Matt and Megan were to move to a country with tax laws like Costa Rica, they would not pay income tax to that country on their UK and US pensions.
• Other countries have income tax rules that depend on how much time is spent in that country. So it's possible to slow travel or split the time spend in a few countries and not pay income tax to the countries visited.
• Countries that tax their citizens living abroad are the United States, Eritrea, and North Korea.
• While there may be tax advantages to living abroad and giving up US citizenship, Dave has decided that he benefits of retaining citizenship far outweigh the benefits of not paying taxes and the risk of not being let back into the country.
• Wyoming is an easy state to incorporate a business and there's no state income tax. If also living outside of the US for 330 days a year, you can be eligible for the foreign income exclusion and exclude $100,000 of income from taxation.
• Alternatively, Matt could set up an online business overseas and pay Megan a salary up the foreign income exclusion amount and also avoid self-employment taxes.
• Living in Costa Rica, Dave's children have been learning through a combination of the local international school, homeschooling, and the Simple StartUp entrepreneurial program he's been running for a home school group. He is able to have conversations about business and money with his kids about money and they have become interested in investing as well.
• Though Dave and his family primarily rented homes while moving around the world, the rental market in Costa Rica made conditions more advantageous to buy. When they travel back to the US for extended periods, they can rent their home in Costa Rica out.
• Diversification doesn't just apply to a stock portfolio. You can be diversified in passports, income streams, and properties from other countries. Spreading your bets around different countries can make sense.
• Dave discussed some of the issues expats have opening local bank accounts as US citizens. Matt and Megan have been using Revolut to more easily move money around between countries.
• Opening up a Roth IRA is something Dave suggested Matt and Megan could do to stash away some tax-free money and have ready access to the principal later.
• Health care coverage overseas was another area Dave suggested they look into, although health care is frequently more affordable overseas. International policies are always an option to look into as well. The policy Dave has for his family cots $7,000 a year and provides coverage everywhere except for the United States.
• Another helpful tip Dave has for expats is to always have a couple of different bank accounts to avoid issues with expiring cards or the need to access larger amounts of cash.
• Opening and using US credit cards and travel rewards is also possible overseas. Dave uses a company called Mailbox Forwarding to receive and scan his mail.
• It can be a hassle to try and say you aren't a resident of some states anymore avoid paying state income taxes. South Dakota does not have a state income tax and only requires residents to be there one day per year to maintain residency.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Greenback Expat Tax Services
• The Simple StartUp by Rob Phelan
• Switch to Mint Mobile and get free shipping
• Register for The Simple StartUp Fall Challenge
• Revolut
• Mailbox Forwarding

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• Who do young people look up to today? The lifestyles marketed on MTV and social media not exactly something to aspire to, but where can the next generation go to find something different?
• Inspired by the work of her father, Don Wettrick, and feeling like she needed to take charge of the issue, Ava Wettrick created MentorZ, a platform designed to introduce great people to Generation Z.
• As a young child, Ava thought her dad was the smartest guy in the world. It wasn't until she got older that she realized he wasn't necessarily smart, he just read a lot. She's witnessed his transition from teacher to owning a non-profit and embrace the experience.
• Being a voracious reader, it didn't take much pushing from her dad to begin consuming content from the likes of Tom Bilyeu, Simon Sinek, and Victor Franco and having an influence over her peers.
• Since getting to know several entrepreneurs, Ava questioned whether or not college is worth the time and expense. She was surrounded by highly successful people telling not to go to college, but she is attending college and has found it helpful to have the financial support of her parents and scholarships while growing, learning and choosing the information she wants to consume.
• Don acknowledges that for some majors, college is still relevant, and for those who have the money should go, but have a plan. He thinks the best thing students can do is to start doing the thing they might love and begin to shadow people to determine if it is a good fit.
• Majoring in entrepreneurship at Ball State, Ava is learning about accounting, marketing, running a business, and being a CEO which has only accelerated her drive to make the podcast a success and provides quality content and great messages.
• Interviewing guests for her podcast has been a significant personal learning experience and changed her perspective on the power of an interview. She waited a year to release the episode recorded with Tom Bilyeu because she feared it wasn't good enough and yet people think it was one of her best. And following her interview with Dov Baron, she received feedback that he believed in her and wanted to mentor her.
• While there are ways of doing things to make them appear more important than they are, “fake it til you make it” can have its drawbacks. Don believes humility can be key when it comes to Imposter Syndrome.
• When it comes to second generation FI, Don says it happens by osmosis. His kids have been raised under a frugal lifestyle.
• Since his last appearance on the podcast, Don left his teaching job to take the non-profit to the next level, growing both the team starting chapters in co-working spaces and tech hubs.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• The StartEDUP Foundation
• The 4-Hour Workweek by Timothy Ferriss
• Outwitting the Devil: The Secret to Freedom and Success by Napoleon Hill
• Learn to be a better writer with Grammarly Premium
• Register for The Simple StartUp Fall Challenge
• ChooseFI Episode 013 The Unfair (FI) Advantage of Teachers 457b
• Man's Search for Meaning by Viktor E. Frankl
• Impact Theory Podcast
• ChooseFI Episode 087 Education Through Innovation
• Sign up for ChooseFI's FREE FI101 Course!

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

Progress Coach, Jillian Johnsrud, meets with Households of FI member, Corinne, to review the two exercises designed to help her understand how she can prioritize her life to focus on the things that matter the most.

• After taking a quiz to reveal which of the Four Tendencies she is, Corinne discovered that she is an Upholder. She has many things that she would like to do but struggles with feeling guilty about doing non-work related things that are important too.
• Corinne would like to find more time for meditation and develop better awareness and confidence with her finances.
• Though Corinne always felt like she was decent with money, beyond investing in a 401k, she would like a better understanding of what her baseline expenses should be and where she can make improvements with a budget and investments.
• When it comes to learning, Corinne feels that she learns best by practice, repetition, and talking through things, but would love to make her processes as automated as possible. Jillian suggested that Corinne may learn about investing best through a book club, class, or mastermind group.
• Her goals for mediation are to be more in tune with her body, realize when she needs to step away from work and take a break plus try and have mediation become a part of a daily routine.
• Jillian divides priorities into two categories, the things we want to make progress on and the action steps to take. There is a huge return on the investment when taking those actions, but things that help with progress are foundational and make life easier.
• As habits develop in stages, Jillian suggests Corinne first try to find a place in her life for a two-minute meditation habit, before getting started and trying to optimize it. This will help test out when mediation might be appropriate and get through the learning curve. Then focus on any hesitation resistance to doing those two minutes.
• Creating habits can be more successful when added to an existing routine or by creating a prompt.
• Corinne would also like to make progress in her career. She needs to stay focused better during working hours to make the most out of them and make progress with communication and executive presence.
• Exercise, eating healthy, and socializing with friends are other areas where Corinne would like to reduce friction and make doing them easier.
• Since starting a new habit is so difficult, Jillian likes to divide the year up into six-week chunks and focus on one of the new habits in each of the six weeks. The synergy between the habits begins to build momentum.
• For the exercise “Challenges and Motivations”, Corinne felt making partner at work was her biggest motivation because she values being part of a team or community and having a sense of belongingness. Other motivations she has are security and autonomy.
• To increase Corinne's sense of her top three motivations, she feels that she hasn't done well lately with maintaining relationships and connections with people. Jillian likes to use her understanding of the five love languages as a framework to strengthen relationships with others.
• The biggest challenge to meeting the goal of becoming partner is balancing the expectations of her time at work with her personal life which is why she would like to be more focused at work. Additionally, she would like to stop comparing herself to others at work and concentrate on what works for her.
• Options for tackling challenges include self-correction, finding a more helpful perspective, and problem solve it. In Corinne's case, Jillian thought she would benefit by actively looking for leaders who were more like her rather than the hard-charging partners in her workplace.
• Regarding Corinne's challenge with setting boundaries at work with her time, people who work for her sometimes find it difficult to connect with her. Jillian suggested creating a specific time or better communicating what times she is available.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• JillianJohnsrud.com
• ChooseFI Episode 162 The Four Tendencies and FI With Gretchen Rubin
• Everyday Courage Episode 32 Four Tendencies, The Obliger
• Save on shipping costs with a free four-week trial with Stamps.com when using code “ChooseFI”
• Earn $1,000 or more with ChooseFI's 3 card cash back strategy
• The Five Love Languages by Gary Chapman

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• For those on the path to financial independence, finance, fitness, and life optimization all intersect.
• During her career in the banking industry, Shannon McLay found it didn't work for the people she wanted to help. She set out to use her skill set and training to change the coaching industry and founded Financial Gym.
• Even for those who not physically fit, they know what it looks like and there are many resources available for achieving it. The path the financial independence is similar in that it is a long journey. You have to work up to it, will experience setbacks, and take breaks.
• Much like diets, budgets don't work long-term. Making lifestyle changes is the key to success.
• At the Financial Gym, clients hit 90% of the goals set for themselves by examining their money behaviors and constantly working to figure out what's will work for them.
• The two largest emotions people have regarding money are fear and shame. Once people drop these highly charged emotions and understand the financial numbers don't define them, they can break through and embrace moving forward.
• After turning 30, Shannon realized she didn't want the life she was leading. Her life's trajectory changed when she came to understand that to have long-term sustainable happiness is to help other people and not expect anything in return.
• During her work as a financial advisor for Merrill Lynch, she discovered she enjoyed helping out her pro bono clients far more than the wealthy ones. It allowed her to see there was a need for a service where it didn't matter what you looked like financially, you just needed to get financially healthy.
• Much like going to the gym to get healthy, her concept of a financial gym was a place to meet with financial trainers for a monthly membership fee.
• Following the model of H&R Block, Shannon believed people wanted to meet with a financial advisor face-to-face. She was advised to prove the model would work before looking to raise money.
• Experimenting with different plans and prices, she had great success with her first clients increasing their net worth. Clients wanted to keep working with her, but she was running out of money to continue investing in her business. When a former boss invested $100,000 in her concept, she rebranded using the gym concept.
• The physical environment of the Financial Gym created a community where clients had a shared goal and a safe space to talk about money.
• Shannon was able to scale her business by developing a training program and teaching compassionate and empathetic people what she knew.
• Those contemplating becoming an entrepreneur should ask themselves, “Am I a good problem solver?” because running a business is like solving a lot of word problems.
• No one's financial situation is so bad that it can't be fixed. The trainers at the Financial Gym have seen and fixed it all.
• On average, clients pay $70-80 a month for membership, but they offer a six-month money-back guarantee which they've never needed to pay out on. The average client increases their net worth by $2,500, increases their credit score by 60 points, and negotiates a $5,000 a year salary increase within the first 3 months of membership.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Compare quotes from top insurers with Policy Genius
• Earn $1000 or more with ChooseFI's 3 card cash back strategy!
• Happiness: A Guide to Developing Life's Most Important Skill by Matthieu Ricard
• Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts by Annie Duke

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

• The Troy and Lindsay are new on their journey, finding FI several months ago after making a budget and realizing they had no money left over at the end of the month. Compared to other systematic approaches to becoming debt-free, they felt FI was creative and adaptable to a variety of lifestyles.
• The first step Troy and Lindsay took was to determine where all their money was going using a budget tracker, which enabled them to cut monthly expenses and continue to do the things they enjoyed doing, like going to happy hours.
• Except for their mortgage, the Troy and Lindsay have paid off all of their debt, contribute to a 401k, and have an $80,000 net worth, including a $15,000 emergency fund.
• Though they both enjoy their jobs now, Lindsay is a teacher, so Brad suggests considering her pension's “worth vs worth it” as Grumpus Maximus has discussed on the podcast and in his book, The Golden Albatross.
• Use the 4% rule of thumb to determine what your net worth should be to reach FI. Using the 4% rule, you can withdraw 4% of the balance each year to live off of and reasonably expect it to last for the rest of your life. To calculate your FI number, multiply your annual expenses by 25. For every $100 cut from your monthly expenses, is $30,000 less you need to save to reach FI.
• Troy and Lindsay recently refinanced their mortgage from 4.75% to 3.25% and are investing the $500 a monthly savings into 401ks and Roth IRAs.
• When wondering about paying off their mortgage, Brad acknowledges that there is a real psychological satisfaction the goes along with it, but he looks at it in this way. The interest portion the payment is the true expense, while the principal payment is a reallocation of net worth going from your checking account into home equity.
• Brad suggests taking the time to document a year's worth of expenses and look at different scenarios for what life may be like in retirement to come up with a range of possible annual expenses.
• When calculating their FI number, Troy realized the number was double if he included a mortgage payment. Brad suggests looking at the mortgage amortization schedule for prepayment options.
• Food expenses have been cut with a goal of $500 a month. Lindsay checks to see what's in the pantry before shopping and meal preps one day a week to avoid eating out, but she isn't penny-pinching when it comes to quality.
• Removing mortgage and childcare from their expenses, Troy and Lindsay's monthly expenses are about $3,500 per month, which puts their FI number at just around 1 million dollars.
• They are currently saving roughly $50,000 per year to add to the $80,000 net worth but are wondering where they go from here.
• Brad acknowledges there can be a lot of initial excitement upon finding FI and making changes, but then there can be a lull. He challenges Troy and Lindsay to figure out what they want their lives to look like rather than compare their FI journey to anyone else's.
• It's important to understand that life is fluid and wants may change over time. Test small before making big decisions or changes. Flexibility and communication with your partner are critically important pieces of the process.
• The next steps Troy and Lindsay will be taking are to build a spreadsheet with different retirement expenses scenarios and talk about what they really want their lives to look like.
• Anyone interested in FI should understand that you don't need to be perfect, but you do need to get started.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• ChooseFI Episode 227 The Golden Albatross with Grumpus Maximus
• The Golden Albatross by Grumpus Maximus
• Protect your online activities with an Express VPN
• Earn $1000 or more with ChooseFI's 3 card cash back strategy!
• NewRetirement Retirement Calculator
• ChooseFI Episode 013 The Unfair(FI) Advantage of Teachers with The Millionaire Educator
• ChooseFI Episode 238 How to Test Out of College While You're Still in High School with The Millionaire Educator
• Get started on your journey at ChooseFI.com/start
• Get a group of friends to join you on the journey with ChooseFI's free FI101 course!

IF YOU WANT TO SUPPORT CHOOSEFI:

• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.

For video highlights from the episode, check out choosefi.com/240.

• Tiffany Alice was raised by a financially savvy father who taught her how to save and handle her money, but a few poor choices in her 20s destroyed her finances. Since overcoming her mistakes, she's made it her mission to help others fix their finances.
• After falling victim to a con man, Tiffany found herself more than $35,000 in credit card debt. Though her pre-school teacher salary wasn't a high income, she was saving aggressively by living simply and transferring her credit card debt to 0% interest cards.
• During the 2008/2009 recession, she was $300,000 in the hole between credit card, student loan, and mortgage debt when she was laid off from her job.
• Seeing that she was struggling less with financial hardship because of the lesson's Tiffany had learned from her father, friends began to ask for help with their finances. She liked teaching and turned teaching financial education into a business.
• Through her business, she can make good money, help people, and still have happiness and time. She feels that she is living her life in complete alignment. Even with a high net worth, she and her husband continue to live frugally and without debt.
• One of the lessons her mistakes taught her was to get straight to a solution sooner rather than allow shame or ego to delay it. It's important to acknowledge your role in mistakes, take full responsibility, and then get over it.
• Teaching financial education was the easy part. Tiffany found that her own financial struggles allowed her to relate to people. She doesn't consider herself to be a guru but an educator helping her girlfriends along.
• Tiffany built her business from one-on-one financial coaching to a following of over half of a million people in her Dreamcatcher community.
• Volunteering in her community and utilizing her network, in addition to social media helped get her business off the ground.
• When followers from outside her local area began to request her course, Tiffany scaled the business to reach anyone, no matter where they lived, with her Live Richer Challenge. When it launched, 10,000 people had signed up.
• To date more, than 900,000 have taken one or more of her Live Richer challenges.
• Along the way, Tiffany learned about blogging, video editing, affiliates, monetization, and self-publishing.
• A good teacher has to be constantly learning, listening, and reading, but what made Tiffany a really good teacher comes from being a pre-school teacher, she honestly cares about her students.
• She's taken her skills in leading and caring about students as a teacher and applied them to her business, making it an amazing place to work where her employees feel looked after and cared for.
• Tiffany has authored a pre-financial education book, Happy Birthday Mali More, aimed at teaching pre-school age children a lesson about the things that matter most.

RESOURCES MENTIONED IN TODAY'S CONVERSATION

• Free 4 week trial with Stamps.com! Click on the microphone and enter code “ChooseFI”.
• Earn $1000 or more with ChooseFI's 3-card cashback strategy
• Live Richer Challenge
• Live Richer Academy
• Happy Birthday Mali More by Tiffany Aliche

IF YOU WANT TO SUPPORT CHOOSEFI:

Share FI by sending a friend “ChooseFI: Your Blueprint to Financial Independence".

• Don't believe that you need anyone's permission for access anymore. The gatekeepers are gone and the ability to access knowledge on-demand and create a business model around it has never been easier.
• The realization that you have autonomy gives you control over your life is transformational. You can control your expenses and reach FI. You can choose to pursue interest-led learning and follow a passion. There is no more "they" you need to seek permission from.
• MK didn't need the permission of traditional publishing's gatekeepers, instead, she learned how to self-publish.
• Employers are beginning to value skills over degrees. Google recently announced they are offering 3 new online certificate programs in skill areas critically important to the tech industry. Google is even offering 100,000 need-based scholarships for individuals enrolled in the certificate programs.
• Start building a talent stack around what interests you.
• Bradley Rice from episode 117 is building BradForce Academy, a course designed for people in a Salesforce career looking for more freedom and flexibility.
• Working just 20 hours a week as a Salesforce Freelance Administrator in 2019, Bradley Rice made $225,000 using skills he had picked up during his lunch hour.
• From the community, Chris shared a big win on the ChooseFI Facebook page. He and his wife maxed out her Employee Stock Purchasing Plan and used to it help pay off her student loans once it reached its maturity to qualify as long-term capital gains. For the first time in 20 years, they feel like they are winning the game.
• Josh challenged Brad to share what his Todoist organized life looks like. In it, Brad has everything scheduled, from chasing his home air filters every 2 months to passport renewal reminders to subscription cancelation dates.
• Brad's taking his Red X month off from work, but ChooseFI episodes will continue with amazing pre-recorded shows, including an episode with The Budgetnista, Tiffany Aliche, and deep dives with the Households of FI.
• Jonathan issues a challenge to start on the path to FI. Gather a small group of friends and go through a 6-8 week transformation together starting September 1.

Resources Mentioned In Today's Conversation

• Google Announces 100,000 Scholarships for Online Certificates
• Earn $1000 or more with ChooseFI's 3 Card Cashback Strategy
• M1 Finance
• ChooseFI Episode 117 Making the Case for Part Time with Bradley Rice
• Salesforce Freelance Consulting Course Preview
• BradForce Academy
• BradForce YouTube Channel
• ChooseFI Episode 024R The Friday Roundup | How to Hack Your ESPP
• Todoist
• ChooseFI Episode 221 Introducing Our Households of FI!! Part 1
• ChooseFI Episode 224 Introducing Our Households of FI!! Part 2
• ChooseFI's FREE FI101 Course

Gerry Born, the Millionaire Educator, joins the show to talk about strategizing college via online classes, dual enrollment, and CLEP Testing. 

For more information, visit the show notes at https://ChooseFI.com/238

Today we talk about asset allocation versus information allocation. What are you doing with all the information you are taking in? Are you making intentional steps to build your talent stack? Tune in to today's Friday Roundup!

For more information, visit the show notes at https://ChooseFI.com/237

The guys talk about their journey toward financial independence and fitness and how closely the two correlated to one another.

For more information, visit the show notes at https://ChooseFI.com/236

Jacques Hopkins shares how he built an online course and some of the skills he had to learn along the way. If you have been sitting on an business idea you definitely want to listen to this episode!

For more information, visit the show notes at https://ChooseFI.com/235

Brad's children learn a valuable lesson on running a business and some of the associated difficulties. As Tesla becomes a potential candidate for the S&P500, the guys take the opportunity to touch a bit on questions you might have about this aforementioned index. And the pronunciation of our Brand: ChooseF.I. or ChooseFI? Or is there even a potential dark horse in this race as a third alternative? Find out on today's Friday Roundup!

For more information, visit the show notes at https://ChooseFI.com/234

Jordan Harbinger shares his tips and techiques for managing and expanding your network

For more information, visit the show notes at https://ChooseFI.com/233

Doug Nordman and Carol Pittner Join the show to talk about how to raise your children to think about the potential of money in a positive way

For more information on the show and for shownotes visit https://www.choosefi.com/232

Jonathan makes a bet, the secret to wealth lies in the Casserole, and the guys share their thoughts on college planning

For more information, visit the show notes at https://ChooseFI.com/231

Jonathan, Brad, and MK have collected tips, comments, hacks, and feedback from the community for crushing college debt free.

For more information, visit the show notes at https://ChooseFI.com/230

Corey and Jess from The Fioneers join the show to tell share their story of getting on the same page financially. They talk about incremental freedom, habitual spending triggers, and stress management.

For more information, visit the show notes at https://ChooseFI.com/229

The guys talk about their strategies for public speaking, and Brad shares how podcasting has played a key role in learning to play into his strengths in order to overcome his fear of public speaking.

For more information, visit the show notes at https://ChooseFI.com/228

Grumpus Maximus has partnered with ChooseFI Publishing to release his book The Golden Albatross. While pensions can seem like a dry topic, Grumpus has created an in-depth guide to the subject while simultaneously making it enjoyable to read. Today Grumpus is on the show to talk with us a bit about his story.

For more information, visit the show notes at https://ChooseFI.com/227

Lauren and Steven Keys from Trip of a Lifestyle join the show to share their story of frugalality to live a life doing the things they love.

For more information, visit the show notes at https://ChooseFI.com/226

Today we're talking about staycations, traveling the world ~$1,200/month, and community wins!

For more information, visit the show notes at https://ChooseFI.com/225

Today we are introducing the second 4 households in our on-going case study project where we follow 8 households on their journey towards FI. Each household is just starting their journey to FI, and each of which ultimately have the same goal: achieving FI.

For more information, visit the show notes at https://ChooseFI.com/224

The Nomads join the show to talk about their system for perpetual travel, and all the nuances that go into a nomadic lifestlye.

For more information, visit the show notes at https://ChooseFI.com/223

A lot of people think FI is about having as much money as possible, but that is a fundamentally flawed supposition. Jonathan and Brad saw plenty of "successful" people in the workforce who were miserable. Today we talk about the Oh-so-dreaded mid life crisis, and what FI is really about.

For more information, visit the show notes at https://ChooseFI.com/222

Today we are introducing the first 4 households in our on-going case study project where we follow 8 households on their journey towards FI. Each household is just starting their journey to FI, and each of which ultimately have the same goal: achieving FI.

For more information, visit the show notes at https://ChooseFI.com/221

Nancy Bachety worked as a school teacher for and was deeply dissatisfied with the 403b retirement fund that was being offered to teachers. On this episode Nancy shares her story and how she fixed her 403b account.

For more information, visit the show notes at https://ChooseFI.com/220

Today we talk about using skills to pivot when laid off using MK as a fantastic case study of this concept. Additionally we have some announcements and awesome community wins in the mailbag today.

For more information, visit the show notes at https://ChooseFI.com/219

Brandi joins us and shares her story on another case study episode. After sharing her finances, Brandi sees the big difference that small changes can make for retirement.

For more information, visit the show notes at https://ChooseFI.com/218

David from Greenback Expat Tax Services explores the basics of taxes for expats. Learn about the rules surrounding expats taxes and strategies to consider.

Chris Browning joins the ChooseFI podcast to have a vital conversation about systemic racism in America and what we in the FI community can be doing to help.

For more information, visit the show notes at https://ChooseFI.com/216

Audrey Bellis, joins us for a Wednesday case study. Audrey shares with a us a story of empowerment and self-motivation.

For more information, visit the show notes at https://ChooseFI.com/215

Today Ashley Barnett from the ChooseFI team joins the show to share her story and teach us how to make a blog that stands out!

Jonathan makes one the Barrett Top 50 for some "FI-ne Dining", the guys detail this little known tax credit, got some community Feedback, Brad was on Jillian's latest episode of Everyday Courage, and ChooseFI case Studies will be coming regularly to a podcast player near you.

For more information, visit the show notes at https://ChooseFI.com/213

Today Jonathan and Brad are doing a case study with Kashia Palmer. Kashia shares her story about getting out debt and has the guys look through her budget to find out her time frame for financial independence.

Jessica, The Financial Mechanic, shares how she created a ten-year path to financial independence through a career shift and salary negotiations.

For more information, visit the show notes at https://ChooseFI.com/211

Today on our mailbag episode we have exciting news from MK, information on 401K's to Roth IRA's, news from Choosefi Publishing, an alternative summer camp possibility, and more from our community

Fritz from Retirement Manifesto is back to dig a bitter deeper into the minutiae of the numbers behind retirement, and the use of the bucket strategy.

Bianca, a flight attendant, reached Financial Independence in her late 30’s after many bumps in the road.

She shares her story of financial resiliency.

Today we have a bonus episode featuring an episode from Everyday Courage with Jillian Johnsrud and JL Collins.

Figuring out how to invest is a challenge for many, including Jillian. By the time she and her husband started investing, they had paid off all their debt and saved up a lot of cash. Like many people, Jillian waited far too long to start investing. She was scared, intimidated and didn't really understand it. JL Collins says this is all too common, and he is here to make investing simple.

Today is community mailbag, and we are taking a look into some corrections, criticism, and feedback from previous episodes . Next we have a Frugal Win of the Week from Will for his brother Matt. Before all that though, Jonathan talks about his 2020 health challenge, and the power of incremental progress.

Fritz from Retirement Manifesto joins the show to talk about the mentality you should have when entering retirement.

Today Sean Mullaney is back to talk about 5 money moves to make during a financial crisis, and digs deep on what it looks like to make back money on a realized loss when you panic sold.

On today's episode we have the long awaited Barrett top 50 recipes(well, top ~30), the guys talk about ideas for Mother's day, the new Podcast for all things business called the Rebel Entrepreneur has launched, and a thought provoking mailbag question 

Coach Carson comes on the show to provide some insight on the current real estate investing market, and what to look for when starting out.

Travis Hornsby is back on the show to share a bit of knowledge on his specialty: Student Loans. Travis digs into some details that could potential save you thousands of dollars on your student loans.

It's mailbag time, and today we answer a question about the rule of 55 and how some are able to access their 401k penalty free at 55. We also have a segment with Jillian from Everyday Courage

On a recent episode we gained a better understanding bonds. Today Brian Feroldi who writes for the Motley Fool joins us to give us a deeper understanding for stocks and how they are valued.

Big Ern joins ChooseFI again this week to discuss making necessary adjustments to your portfolio when the economy takes a downturn.

Today is community mailbag where the team answer questions and listens to feedback from you our listeners, but first they talk about Big ERN's optimism.

After 40 days of quarantine, we are beginning to adjust to this new normal. We're talking groceries, working remotely more permanently, creative socializing in quarantine, and finding your lost money.

Big Ern joins the show to talk about possible scenarios for the recession we find ourselves in, and markers to look out for on the horizon for the recovery of our economy.

Brad and Jonathan talk with Alan Donegan about possible ways for how you can pivot during this time. Additionally, listen until the end for the special announcement from Alan and the ChooseFI Team.

Frank Vasquez joins the show to talk about portfolio diversification with bonds, and the important value that they can add.

Other ChooseFI Media:

Support our YouTube channel by subscribing at: https://www.youtube.com/choosefi?sub_confirmation=1

Listen to other episodes from our Financial Resilience Daily Show at: https://www.choosefi.com/financial-r/

Dig deeper into Financial Independence by reading our Blog at: https://www.choosefi.com/all-articles/

About us: 

Everything we do, we do to help you slash your expenses, crush debt, and build ways to earn a living remotely by starting online businesses. Then we help you invest in the safest way we know how, despite the ups and downs of the stock market.

We take the hits, so you don't have to, because ultimately, we want you to become financially resilient during these trying times, and get you started on the path towards Financial Independence.

Please SUBSCRIBE and enable notifications to see NEW EPISODES. 

CONNECT:

►OUR WEBSITE: https://choosefi.com

►BUSINESS EMAIL: feedback@choosefi.com