Meet Dan, Matt’s financially savvy brother to discuss what he’s doing right, wrong, and what he could do better. Are money smarts genetic?

We learn early on the difference between Matt and Dan.  As children, Dan asked for stocks for Christmas while Matt asked for XBox games.  Their Mom told me they still do that actually.  Dan also took personal finance classes while in high school, again underscoring the importance of teaching PF in school.

Dan started college majoring in finance but changed to management information systems after one semester.  He graduated with $45,000 in student debt and bought a house soon after.

He did not take Matt’s advice to “live a little” but put 10% down while maintaining a cushion of about $10,000.  Half of that is in Betterment and the other half is slowly being moved from savings to Betterment.  Dan has a private  IRA and a pension through his job.

Dan has no credit card debt and owes $4,000 on his car.

Dan has some changes that are coming up to his situation.  When he bought his house he was given a five year tax abatement.  When the five years is up, the mortgage payments will increase.  He is also eligible for a program that will partially forgive his student loans after he has worked for a public institution for ten years, he’s five years in.

How can Dan do better?  Turns out, Dan is doing pretty damn well.  His portfolio is diversified and he’s interested in his financial situation.  He should pay off the car loan within a few months to free up $300 a month that could be better spent in Betterment.  He may also start researching 3-4 individual companies that he’s interested in and can invest in.  He should also make better snack choices.

Show Notes

Betterment:  An on-line investing tool.

Mint:  LMM’s favorite budgeting tool.

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