For those who have money… or want more of it!
Join Mindy Jensen and Scott Trench (from BiggerPockets.com) weekly for the BiggerPockets Money Podcast. Each week, financial experts Mindy and Scott interview unique and powerful thought leaders about how to earn more, keep more, spend smarter, and grow wealth.
Finance Friday: Using Student Loan Forgiveness to Catapult FI w/ Sammie
Today we talk to Sammie, a physician assistant out of the San Francisco Bay Area. Sammie makes a great income, around $140,000 a year, but is strapped with a very big $160,000 student loan debt. The good news? She’s eligible for public service loan forgiveness within only a few years, all she needs to do is continue paying her loan payments while keeping her job, and the debt will be wiped away!
This is fantastic for Sammie, because she wants to start investing more into assets so she can hit financial independence within the next decade.This should be more than possible seeing as she used to be spending a lot on her rent in San Francisco, but decided to move back home with her parents two years ago to not only help them, but save money.
Sammie has some options to work more hours at her job, invest more aggressively, or buy some rental properties. She has a good amount in cash savings and would be comfortable looking into rentals starting next year. She also has a $200,000+ investment portfolio, so not only does she have a positive net worth, when her student loans get forgiven, she’ll be sitting on a lot of money she’ll be able to play with!
In This Episode We CoverPublic service loan forgiveness for student loansMoving back home in order to save money on rent Creating more streams of income to hit FI faster and so you can retire more comfortablyChoosing to stay at your job even if you’ve hit your FI number Investing in your 401(k), Roth IRA, and Traditional IRAKeeping monthly expenses as low as possible on your road to retirementAnd So Much More!Links from the ShowBiggerPockets Money Facebook GroupBiggerPockets ForumsFinance Review Guest OnboardingScott's InstagramMindy's TwitterBiggerPockets Money Podcast 22 with Travis HornsbyStatus Post Adulting PodcastReal Estate Agent DirectoryBiggerPockets Money Podcast 118BiggerPockets Money Podcast 84 with Kyle MastBiggerPockets Membership Benefits & CostBiggerPockets BookstoreCheck the full show notes here: https://www.biggerpockets.com/moneyshow186
“I DON’T Want to Retire Early” with Investing Expert Barbara Friedberg
Barbara Friedburg wasn’t always the savvy investor and saver that many people know her as, but her background helped get her there. Born to parents of the great depression, Barbara had the traits of frugality and modesty instilled into her from a young age. Money was an open subject of discussion in Barbara’s household, unlike most households today. Her parents taught her to value money, not waste it, and be smart when you spend.
Barbara’s innate financial intelligence was clearly shown when she met her husband. Within two weeks of them getting together, Barbara had already taken over her future husband’s finances and got his money into a retirement account. This led to them having a very financially healthy relationship, never spending more than they needed to, and putting a substantial amount of their income into savings and 401(k) accounts.
Barbara then went on to become a financial planner, investor, consultant, and author. In a time where the market is so overvalued, she advises young people to be smart with their income and understand that wealth is built in the long-term, not through quick gambles. Save your money, invest it consistently, and get off the hedonic treadmill. “Don’t covet your neighbor’s BMW” is what she told us!
Barbara also gives us an inside look into her current investments, and why she heavily favors passive index funds over single stock picks. She goes into short, medium, and long-term money, and the uses for each. For young people who haven’t gotten a grip on finances yet, this is a great episode to hear from someone who has done it successfully for decades!
In This Episode We Cover Making sure that money is a topic often discussed in your family Knowing the value of money and fighting back the urge to spend frivolouslySaving a large amount of your income whenever possibleWhy Barbara doesn’t believe the FIRE Movement is attainable by mostWhy You HAVE to be diversified in order to succeedWhat to do with your short, medium, and long-term moneyAnd So Much More!Links from the ShowBiggerPockets Money Facebook GroupBiggerPockets ForumsFinance Review Guest OnboardingScott's InstagramMindy's TwitterHacking Hedonic Adaptation to Get Way More For Your MoneyFree Investing Resources Check the full show notes here: https://www.biggerpockets.com/moneyshow185
Finance Friday: Is Your FI Number Overly-Conservative?
Saving up for financial independence can take some time, but if you’re earning a high salary, keeping your exSaving up for financial independence can take some time, but if you’re earning a high salary, keeping your expenses low, and heavily investing, FI can come quicker than you think. Today, we talk to Kristine, an estimator in the mechanical engineering and plumbing industry. Kristine and her fiancé make a sizable amount of money. Even better, they spend very little for their income bracket and invest in long-term index funds.
Kristine and her husband are thrifty, they pay only $600 a month to rent a room in a house and are just now about to purchase their first home. They’re putting 20% as a down payment and are ready for a large shift in disposable income. They’re also planning on having kids in the future, and want to be sure they can retire on their terms so they can spend time with their children.
Originally Kristine wanted about $3.1 million dollars in assets to hit a $100,000+ per year withdrawal allowance (using the 4% rule), but Scott and Mindy argue that this could be more aggressive than needed. Kristine may be over-budgeting for future children and other expenses, without realizing that her sizable amount of assets could compound quicker than she thinks. Will Kristine be able to retire far earlier than she plans? Listen to find out!
In This Episode We CoverHow having a high income can put you on the fast rack to FIKeeping your housing expenses low especially when you’re making a lot of moneyPutting money into bonds as opposed to high-yield savings accounts Being on the same page (financially) as your partner and having regular money datesHaving future expenses budgeted so you can have an accurate retirement goalAnd So Much More!Links from the ShowBiggerPockets Money Facebook GroupBiggerPockets ForumsFinance Review Guest OnboardingHow I Used Real Estate to Pay for My Newborn Daughter’s College Education
Check the full show notes here: https://www.biggerpockets.com/moneyshow184
Mini Millionaires: How to Set Up Your Children for Financial Independence with Rob Phelan
Those who are part of the FI or FIRE movement know how important it is to set yourself up on the right path in your youth. For parents, how do you get your kids excited about pursuing financial freedom? How do you talk to your kids about taxes, retirement accounts, saving, investing, and real estate without them falling asleep?
This was Rob Phelan’s question when he started working to build the Choose FI Foundation. The foundation’s goal is simple: help kids achieve financial literacy before they leave high school, let them break free from debt, build towards retirement, and live happier, more secure lives. Contrary to many parent’s beliefs, when children are presented with education regarding them becoming rich, they actually perk up.
Rob stresses that a child’s relationship with money is more important than things like amortization schedules and interest rates. Different age groups learn about money in different ways. For example, elementary school children may learn through broad concepts and simple planning, middle school children are ready to learn about retirement and taxes, and high school children can ask the big questions like “what will make me a successful adult?” as well as developing saving and spending habits.
Rob created different programs and projects such as his “meal planning” project where he asks kids to plan a week's worth of meals and compare their incomes against their expenses. He talks to high school students about house-hacking and creating cash flow so they aren’t stuck in a job they hate. He also runs The Simple Startup, where he teaches children how to start their own business for free!
If you’re a parent or teacher, you can access the Choose Fi Foundation’s full curriculum for free, and get your kids onto a great start!
In This Episode We CoverWhy Rob chose to focus on financial literacy for children The importance of solidifying crucial financial concepts in childrenHow to help your children develop good saving and spending habits Which topics work best for specific ages Using the “Bank of Dad” idea to teach kids about savingMotivating high school students to reach financial freedom early in lifeAnd So Much More!Links from the ShowBiggerPockets Money Facebook GroupBiggerPockets ForumsFinance Review Guest OnboardingChooseFI PodcastFree resource for parents, 102 Business Ideas for Young Entrepreneurs
Check the full show notes here: http://biggerpockets.com/moneyshow183
What if My Career Gets Phased Out? Finance Friday with Mike
Mindy and Scott don’t often get stumped on the Money Show, but it happens once in a great while. What do you do when you have a multi-million dollar net worth, appreciating properties, a maxed out 401(k), and a solid safety reserve? That’s exactly the question that today’s guest, Mike, has.
Mike has worked in the music industry for years, moving all around the US to do his job. As technology has evolved, Mike is predicting an end to his specific role over the next decade, and is wondering what he should do next. He doesn’t have a lot of interest in starting a business or buying more real estate, but wants to squeeze out more money or savings if he can.
He has rental properties that have highly appreciated, but are having cash flow problems due to COVID-19. One, located in San Francisco, has netted close to $700k in equity since its purchase 12 years ago. That’s massive! Mindy and Scott go through Mike’s options, such as selling and putting the leftover profit into cash-flowing assets, or 1031 exchanging into a more diverse real estate investment.
Mike is one of the best examples of smart investing we’ve seen on the show, but there’s always more room for improvement with finances!
In This Episode We CoverWhat to do after a real estate investment has grown significantly in equity HOA fees and being prepared for a large cost when owning a condoLooking forward in your career to see when your industry may go through changes1031 exchanges and using them to get more cash flowKeeping your expenses low even if you make a substantial amount of moneyAnd So Much More!
A Slow, Steady, and Sustainable Way to Buy Rentals with Julie
You may hear of 20 year olds with $1,000,000 in real estate, or a novice flipper doing 50 flips a year, or even a wholesaler who made six figures on one deal. What about the everyday investor who slowly grinds and acquires a steady stream of passive income all while building hundreds of thousands in equity overtime? Those are the real people in real estate, and that is a success story worth sharing.
Julie, software engineer and former BiggerPockets employee bought her first house after realizing that a mortgage would be cheaper than her rent. After getting together with her (then) boyfriend, they decided to buy a bigger house. As her first house sat on the market, she waited for an offer, and then made the decision to rent it out.
A few months after buying her second home, she broke up with her boyfriend. Problem? They were both on the title and mortgage. Julie had enough money in her cash reserve to buy him out of the property. Now the property was all Julie’s and she rented out a room to help her pay off the mortgage.
Now Julie has 7 properties, spread out across Iowa, Tennessee, and Kentucky. All with very interesting stories, and all pay her passive income, every month. Julie is proof that with some financial restraint, you can slowly build a real estate empire, without even trying to do so in the first place!
In This Episode We CoverWhen you should own and when you should rent a houseThe dangers of buying a house with someone who may not be in your futureWhy you should borrow less than you’re approved forThe importance of keeping a substantial cash reserve available for investments Never rent to someone who has no credit, no references, and no jobDiving into real estate, even if you don’t know all the tips and tricks yetAnd So Much More!