BiggerPockets Money Podcast

Lifestyle creep, budget hesitancy, and cash scarcity are problems you’d likely hear from someone just getting into the realm of financial independence/literacy. But, funnily enough, these wealth woes aren’t coming from newbies—they’re coming from two asset-stacking veterans, Mindy Jensen and David Pere from The Military Millionaire Podcast.

While on the outside David and Mindy may look like squeaky clean financial figures, they’ve realized recently that they have to tighten up their systems to maximize wealth. Mindy has seen a slow and steady lifestyle creep, and although her income can support her, she still wants to have a strong sense of strategy when it comes to budgeting and expense tracking.

David has tried time and time again to budget, but it’s never really gone to plan. He also is feeling a bit stressed at times due to his “cash poor, asset rich” lifestyle that has allowed him to build so much wealth. Our two hosts serve as financial therapists for one another other in this episode as they dive deep into how each other can re-strategize their financial situations. Even the gurus don’t always get it right!

In This Episode We Cover

How to turn budget hesitancy into expense-tracking mastery 

Stocking up your emergency reserve so you (and your business) can survive life’s hiccups

Entrepreneur income and why you should go lean on your business spending, without compromising quality

Lifestyle/income creep and how to fight it so you can save and invest more 

Why everyone (even our money gurus) make mistakes from time to time

And So Much More!

Rental properties can be a phenomenal second source of income for the majority of us who work at regular jobs. One or two rental property purchases every year or so can slowly, but surely, build a strong foundation for financial independence, sometimes within only a few years. Today’s guest Connor has taken this approach to wealth building and now sits on six rental units, splitting some of the profits with his partners.

Connor runs a lot of the operation for these rental properties. He has a background in construction management, making him an integral piece of any future BRRRR, flip, or rehab project he and his partners decide to take on. But, could these real estate partnerships be slowing down his personal wealth growth? And if so, how does he mitigate the risk of being an independent investor in a cash-intensive business?

Aside from his real estate portfolio, Connor also wants to simplify his personal portfolio, plan for future baby expenses, maximize his retirement, and get a better handle on his financial situation in total. Scott and Mindy leave Connor with some clear action items that may help him achieve financial freedom in his five to seven-year time horizon! 

In This Episode We Cover

Real estate partnerships and establishing the value that you bring to them

Generating more income (and reducing expenses) through live in flips and house hacking

Land contracts and seller financing on rental properties that allow you to scale faster

Student loan repayment, deferral, and when you should plan on starting up your payments again

Shopping for a baby as frugally as you can so you can invest for their future 

And So Much More!

The poverty cycle is a hard one to break out of. For some people, it is near impossible to climb yourself out of the hole that society, family, or unfortunate circumstances have placed you in. But sometimes, through sheer willpower alone, those who break through can crush this cycle and bring their families up with them. Someone who’s done this (and much more), is Dr. David L. Rhoiney from surgiFI. 

Dr. David is a renowned “robot surgeon”, operating on patients using the finest precision that modern technology has to offer. He holds two degrees, has two homes, and invests heavily. You’re probably assuming he was raised in a family that taught him the worth of hard work, education, and investing early. You wouldn’t be more wrong.

Dr. David’s childhood consisted of a combination of living in cars, homeless shelters, sleeping on friend’s couches, and surviving completely on the edge. After being accepted into the US Naval Academy, he knew that he had to do everything he could to never return to that life. He has been told “no” thousands of times, that he wasn’t good enough, didn’t look the part, or simply that he wasn’t worth it. He proved every doubter wrong and has had the last laugh as he and his family now are on the path to a phenomenal financial future. 

In This Episode We Cover

Growing up and poverty and using it as fuel to strive for something greater 

Why you should always choose the “hard path” and pursue something others would fear

Medical student loans and going debt-free through intelligent financial decisions 

House hacking and using rental properties to propel your net worth higher 

Affordable housing and what real estate investors can do to help those in need

Giving yourself no other choice but to succeed, even when all bets are against you 

And So Much More!

Ahh, the age-old question: pay off your mortgage early or invest? It’s no wonder so many members of the financial independence community have strong feelings about one or the other. With a paid-off mortgage, you’re less in debt, with more free cash to invest or spend on things you love doing. But, there’s another side to that cash flow coin. If you’re paying off your mortgage early, you’ll have less money to invest, leaving you with less compound interest. 

If you’ve been asking for someone to answer this question for you, be sure to thank today’s guest, Javier. He’s been doing a phenomenal job paying down his mortgage as quickly as he can, especially at such a young age. Javier has a respectable net worth and works not only at his W2 but also as a real estate agent on the side. Javier is struggling to find where to best put his extra $1,300/month once he pays off his primary residence.

And while this is a BiggerPockets Podcast episode, Scott and Mindy do not immediately vouch for real estate investing. Instead, they take a look at his overall risk tolerance, personal finance situation, and work backwards from his goals to find what he really wants out of early retirement, instead of just grasping for cash. 

In This Episode We Cover

Setting up your “bare-bones emergency fund” so you can invest with confidence 

Whether or not you should pay off your mortgage early 

When the right time to leave your W2 job is and pursue your side income streams

How to pay for healthcare when you’re self-employed or without work subsidies 

How much to allocate towards taxes per month as a self-employed individual 

When real estate investing does and does not make sense for your lifestyle

And So Much More!

You Need a Budget is the expense tracker/budgeter that requires no introduction…but we’ll give it one anyways! In 2004, Jesse Mecham launched this ground-breaking software, allowing money masters and novices alike to easily track their money and plan for a financially stress-free future. Jesse may have been the perfect person to build a product like this—he started tracking his expenses at age sixteen for fun!

As Jesse grew older, he continued to track his expenses regularly, allowing him to have a tight hold on his money and fight back the urge to go into debt. When his wife decided to take a backseat on working and have children, Jesse started to work harder at converting YNAB from a simple spreadsheet to a full-blown business. He was so conservative that three years into the business when he was making twice as much as his accountant salary, he continued to reinvest almost every cent of profit so he could have a strong financial foundation behind him.

Now, some eighteen years after launching, Jesse still holds the principles that he started YNAB with. He lives a simple lifestyle, enjoying “parlor time” with his seven children, keeping a strong emergency fund, and investing in a very, very conservative manner. Take it from someone like Jesse who has “made it”—budgeting can change your life. 

In This Episode We Cover

Why budgeting and expense tracking are important at an early age 

How simple expense tracking allows you to save and invest more while starving off debt

The four money rules that will change the way you think about your finances 

Where to keep the money that you’re saving for emergencies, down payments, and more

How to know it’s the right time to quit your job and pursue your passions

Running your real estate business through YNAB’s intuitive budgeting 

Why Jesse refuses to invest in high-risk assets while building his business

And So Much More!

Financial flexibility is one of the hidden stages along the path to financial independence. When you hit financial flexibility, you have far more choices than you did before. You can invest more, spend more, save more, and work less if you choose to do so. But, this type of lifestyle can only be achieved by being mindful and proactive about where your money is going, as today’s guest Kevin, knows very well.

Kevin’s story was posted on the BiggerPockets Money Facebook Group, where he relived the horror of his credit card being declined at his girlfriend’s birthday dinner. This struck Kevin, since he made a decent salary and was relatively responsible with his money. He contributed to retirement accounts and kept a lean emergency fund, so where was all his money going?

In today’s discovery, Scott and Mindy walk Kevin through which parts of his budget need a tune-up, and whether or not aggressive loan paydown is worth it for optimal financial flexibility. So where can you tweak your budget to maximize flexibility while minimizing credit-card-induced stress? 

In This Episode We Cover

How to pay off bad debt fast and work your way to debt-free status 

Achieving “financial flexibility” before financial independence and the steps to get there 

Tracking your expenses and budgeting for spending (every single month!)

How to cut food and eating out spending so your stomach and wallet stay happy 

What to do with extra income once you’ve paid off all your debt

The importance of a strong emergency fund and always having a safety reserve

And So Much More!

Today’s guest, Jennifer Grimson, is a prime example that every problem has a solution.  Jennifer has always been a hard worker so she had no problem working through college as she aspired to be a foreign service officer, but her life took a turn when she fell in love and married her (now) ex-husband. Her dynamic with money completely changed as he spent money frivolously while she spent conservatively. When things ended poorly 8 years later he sued her 25 times, not including when he sued her mother and brother, and left her with $500,000 worth of attorney fees. 

At this point, she was left with nothing and had two children to raise on her own. While most would be completely devastated, Jennifer focused on finding a way out. Jennifer had never been scared of a little hard work so she found a job with a steady paycheck and filed for bankruptcy to help with her attorney fees. She continued to file for bankruptcy and start  from scratch until she could build herself back up financially. She was then able to rebuild her credit through various methods and gain financial autonomy. 

Her overall goal was to experience financial peace— but she didn’t stop there. She started building small pockets of wealth and always had at least three streams of income at all times. Once Jennifer found out about short-term rentals, she saw an opportunity and started buying houses to convert into Airbnb properties and turn a profit. After 4 years she created an astounding $1.4 million in income-producing assets! 

In This Episode We Cover

How to properly intertwine money and romantic relationships (and how to protect your personal wealth) 

Filing for bankruptcy and how it can be your saving grace from future lawsuits

Borrowing against a 401k and investing with retirement funds 

Rebuilding your credit from scratch (and even bankruptcy!) 

Short term rentals, passive investments, buying land and other ways to build long-lasting wealth 

Cost Segregation and how to greatly reduce your tax burden 

And So Much More!

Expats and rental portfolios go together like peanut butter and jelly. It’s no surprise that a fair amount of retired globetrotters owe their freedom to real estate investing. While many real estate investors are looking to retire themselves and their families in the US, today’s guest Paul has other plans.

Paul thoroughly enjoys his full-time job in Utah. He gets paid well, has access to some phenomenal benefits, and isn’t planning on quitting anytime soon. That being said, Paul has had the itch to live as an expatriate abroad, hopping from country to country, enjoying world travel. But, in order to do this, Paul has to create an income stream that can support him and his partner along their travels.

Of course, as a smart investor, Paul has already been building this extra income in the background. Since starting his rental property investing journey only a year and a half ago, Paul is already at five doors, with a sixth closing soon. He needs to be at ten doors to have enough rental income to cover his expenses in the US, but how much farther could that money go abroad? 

In This Episode We Cover

Why rental properties are perfect for those planning on retiring abroad

Keeping your expenses low as your income grows so you can retire early

When to transition from traditional retirement accounts to real estate investing 

Roth conversion ladders and turning pre-tax retirement accounts into post-tax savings 

Out-of-state investing and leveraging your high income to invest in low-cost areas

Using a HELOC (home equity line of credit) to fund real estate purchases 

And So Much More!

Student loan forgiveness was a hot topic during the 2020 election cycle. With so many outstanding student loan payments, will the government step in to wipe out the debt? While many theorize about this, Robert Farrington takes the opposite angle, urging those who have student loans to prepare for repayment, rather than cancellation. This way, even if your student loans get forgiven, you’re put in a financially advantageous spot.

Robert runs The College Investor, a website dedicated to investing and personal finance for millennials. It comes as no surprise that the biggest thing on millennials’ minds are student loans, especially after two years of repayment moratoriums. So, how does someone strapped with student loans prepare for repayment, especially when so many variables are up in the air? Well, according to Robert, there are some simple steps you can take to make sure you’re paying on time and with as little stress as possible. 

Episode note: This episode was recorded prior to the new student loan pause, set to expire on May 1st, 2022. Mindy and Robert record a special intro to update listeners on the new dates set by the Biden Administration. All other topics discussed in the show, especially around repayment strategy, are still viable and accurate for those who have student loans.

In This Episode We Cover

The most recent student loan repayment moratorium update 

The difference between federal and private student loans and which are preferable 

Refinancing your student loans and why most people shouldn’t 

Student loan forgiveness and whether or not it will come to fruition this year

Steps you need to take NOW to ensure you don’t miss a payment or accrue extra interest 

Which repayment plans work best for your lifestyle and allow you the most financial flexibility 

And So Much More!

Bad debt is more common than it seems. Many people you know have a car loan, personal loan, credit card loan, or some other form of high(er) interest debt. If you find yourself with bad debt, the first thing to do is formulate a plan to get rid of it, unless you want your savings and potential investments to suffer the consequences.

Today’s guest, Stephanie is in a financially solid position, but she has some bad debt to take care of. She’s on her way to financial freedom by forty after already owning a home and having some retirement investments growing in the background. But, her $13,000 window loan at ten percent interest is causing leakage of investable cash flow. 

Yet, Stephanie may be in a better position than she thinks. Since buying her house, she’s seen a big increase in her property value, which may enable her to secure some lower interest financing to pay off her window loan. Scott and Mindy also help Stephanie develop an expense tracking plan, debate whether or not whole life insurance is worth it, and put her in the driver’s seat to become a cash-flowing landlord only a few short years down the road! 

In This Episode We Cover

The importance of tracking your expenses and why every dollar needs its place 

Good debt vs. bad debt and how to know whether or not an interest rate is too high

HELOCs (home equity lines of credit) and using them to pay off bad debt

Whole life insurance vs. term life insurance and which makes more sense for you

Whether or not that bathroom upgrade will have a positive ROI

Becoming a financial expert slowly through podcasts, books, and enjoyable education

And So Much More!