True Wealth - Financial and Investing Podcast podcast

August 05, 2024 Rethinking Wealth Building

With rising costs, high interest rates and expensive housing, how do we adapt and become successful given these difficult times? Let’s talk about ways to bolster our financial and physical health.

In this episode, you will learn the following:

Benefits of saving more than the traditional 10-15% of your income to achieve greater financial independence and flexibility.

Why delaying Social Security benefits could significantly boost your retirement funds.

How planning for financial self sufficiency can mitigate fears about the future of Social Security.

The distinction between good and bad debt.

Practical advice on avoiding common pitfalls like credit card misuse.

Effective methods such as negotiating lower interest rates and using Dave Ramsey’s snowball effect to tackle high interest debt.

Why it’s important to reduce access to credit once debts are paid off to avoid falling back into the debt trap.

Insights into leveraging the financial system to your advantage with disciplined money management.

Power of compound interest and how responsibly using debt can benefit small business owners.

Concept of “living large on less” by making thoughtful choices and maintaining the things you own to reduce replacement costs.

Distinguishing between wants and needs, evaluating high cost items, and finding cost effective ways to enjoy life without overspending.

Importance of incorporating generosity into your financial plan.

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TRANSCRIPT

00:00:00 How much time did you spend over those five years oiling and taking care of them to go buy an $80 pair of shoes?

00:00:00 Yeah.

00:00:00 I don’t know. But which in my wife is the exact opposite for shoes. I bought her shoes. I don’t have a problem buying my wife shoes because I bought her shoes that are just 10 year old shoes that look brand new.

00:00:00 Oh, yeah.

00:00:00 I’m horrible on shoes. So I never buy shoes. My wife buys me shoes. But I won’t buy them because either, just a tool, they’re just going on your feet. And then when they wear out, as long as they don’t look horrible.

00:00:00 All right, everybody. Welcome to the True Wealth Radio Show. Today, I am your host, Matt Dickson, and with me in studio.

00:00:51 Justin Bruggeman.

00:00:52 And we’ve got an action packed show for you guys today where we are talking kind of about the flow of money through your life. And we’ve got a lot for you today where we’re going to be kind of talking about, you know, kind of different phases of life, spending, saving and how that all kind of ties together. And we might even throw cool couple statistics at you that you didn’t know. So Justin, do you kind of want to start the show off today kind of talking about maybe, like ways that we can kind of rethink building wealth? Like we have some preconceived notions. How might we kind of be able to branch out away from those preconceived notions and maybe adopt, kind of a different way of looking at things? Because times are changing, right? Like inflation is here and what rules applied to us maybe five years ago or 10 years ago maybe aren’t the same rules that we’re playing by today because things are different and people are going through unique, kind of new situations. Like I know when I was kind of getting ready for the show today, one of the things that I looked at was just home ownership statistics, right? And if you look at like, millennials versus Gen X at the same age, kind of in that 25 to 34 years old, what is the rate of home ownership? Millennials are at 43% where Gen X was at 51%.

00:02:18 Right.

00:02:19 So that’s an 8% reduction in people owning homes, you know, and that’s pretty big when you start to think about it, almost one out of every 10 people that might have had a home now doesn’t. Right. And so that’s a change, right? Like houses have become more expensive, harder to get into a house. So things have really changed. And so I want us to keep that in mind as we start thinking about, kind of that need to reshape the way that we’re spending or that we’re saving. Talk to me a little bit about, kind of what’s on your mind as far as kind of ways that we can rethink this whole thing.

00:02:58 Yeah, a little bit of it is, we kind of have the general like numbers is, you know, save 10 to 15% for retirement.

00:03:04 Right.

00:03:05 But we don’t really ever talk about is why not more, if it makes sense.

00:03:11 Right. Like if you can actually do it, why stop at 10 percent?

00:03:15 Right.

00:03:15 Okay. I like that.

00:03:17 And so, and then it’s not a matter of, you know, if I maintain this path, am I going to make it? But if I accelerate the path, it can change your options.

00:03:26 Right. I think the key behind what you’re talking about right there is a little bit of just financial independence. Right. Because as it sits now, a lot of people are paycheck to paycheck. We’ve seen lifestyle inflation happen, that’s a real thing. And so as there’s this constant social pressure for us to have more or do more things or spend more money, we’re almost talking about bucking the trend and saying, well, do you really need to live paycheck to paycheck or can you make some adjustments and go from maybe saving 10% to 20% or more and actually putting money away so that you can have cash on hand for when a good opportunity comes along.

00:04:09 Well, if you look at it, even most common, what you would see is people are going to work till full retirement age of 67, collect social security. Most of them typically have some sort of retirement in place, some 401(k)s or an IRA, which, and then based on the statistics that you pulled out, what was the–

00:04:32 Yeah, only like, 36% of Americans–

00:04:36 Are saving for retirement.

00:04:37 Or not resaving for retirement at all. Yeah. So 36% of you, oh, you know, almost four out of every 10 are not saving for their retirement, which–

00:04:47 Typically what you’ll see is people will work. They will put money into their 401(k) and get the match. They will pay into social security, whether they like it or not.

00:04:56 Right.

00:04:57 And then when they retire, that’s what they have. And so then even creeping up to the 10% of savings for retirement or more than that shifts your options to, maybe I don’t work until 67, but maybe I can stop working and I can delay social security until 67 if that makes sense.

00:05:16 Right. And sometimes delaying social security a little bit can really dramatically impact how much money that you get when you’re in retirement, especially if you’re on more of a fixed income. And you know, you hear some people say, oh, I think social security is going away. I’m just gonna, the minute I’m able to get it, I’m just gonna jump in there and take it. What do you have to say to that person?

00:05:42 Then don’t plan for it to be there.

00:05:44 Right? Yeah.

00:05:45 I mean, I’m not gonna–

00:05:46 Like just consider it fluff and then actually save to a point, to where you can self-fund your retirement the entire way.

00:05:54 Exactly.

00:05:55 Yeah, I think that’s actually reasonable. Like a reasonable way to look at this thing.

00:06:01 Yeah, because you, it, just nobody’s ever came back and been like, and I wish I saved more and started earlier. It’s always I should have, I should have.

00:06:10 Right.

00:06:11 Well, if you can do it, then do it because then just expands your options. And then it’s more even being, maybe it’s not in retirement. Maybe it’s an after tax accounts and things like that to maybe purchase real estate and generate more income. And maybe that income replaces your time between, you know, retirement and full retirement age. And that just produces more income and it’s an appreciating asset. So saving more is going to give you options. Having cash available is going to give you more options than people that don’t.

00:06:46 Yeah. And one of the things, I mean, we just talked about it a little bit earlier when you talked about how, you know, homeownership numbers have changed. Right. And I start thinking about… rethinking this wealth building strategy and it brings me back to real estate a little bit from the standpoint that we are seeing less and less home ownership. But traditionally, real estate has been a store of value, especially if you’re making your residence better, like you’re improving it. And I’ve experienced this personally. I bought at a decent time, and housing prices have gone up and now there’s this store of value in my house where if I go to sell it, I’m going to realize a gain, right? And so I think that’s, another kind of cornerstone of the conversation is saying, I know that home ownership is harder to get into now. Interest rates are high, but we also need to think about long term is renting your best strategy. Right? Because you’re giving that money away every month and trade for the place that you’re in. But are you storing any value back into your own pocket?

00:08:04 Right.

00:08:04 And so–

00:08:05 It’s harder now.

00:08:06 It is.

00:08:06 I mean, you go back. Don’t quote me on this at all, but the numbers are somewhere there. 70, 80 years ago, you had average incomes, you know, roughly 10, 11 thousand dollars. Home prices were about double that. They’re about twenty two thousand dollars.

00:08:23 So–

00:08:23 Then you fast forward now, say average income, let’s call it $80,000. It’s now triple income just to purchase a home.

00:08:34 Right. That’s–

00:08:35 Which is harder. It’s almost built to where it’s harder to build wealth in the real estate because the barrier to entry is high.

00:08:44 Yeah, it is getting harder. And so I think maybe one of the things that we should talk about coming up is, kind of some ways that people can be more successful in, you know, saving so that they can afford that house or they can afford whatever that next big thing is. And one of the things that comes to my mind, right, is debt management. How are you managing that debt load? Because a lot of people, they get overwhelmed by it, and then they don’t take care of it. And then that really hinders them from buying a house or from saving or from, you know, just letting their future kind of blossom. And so a big conversation piece that I think we need to talk about is debt management, because not all debt is bad, right? Like there can be good uses for debt, but you got to be smart about it. So I want to talk about some practical ways that we can be, you know, vigilant.

00:09:50 The majority of people, they use credit cards, use it for instant gratification. I’m going to go on this vacation I can’t afford. I’m going to go buy this vehicle I can’t afford. And then it straps you into where you could have been saving this money and paying cash. You’re now spending more money to get to the same point. It’s just you’re getting there faster.

00:10:16 Right.

00:10:16 But you’re paying more money.

00:10:17 True. So I know this might be a little bit of an early break. But Justin, here’s what I want to do. I’ve got a couple different strategies from the person who’s dealing with credit card debt, but I don’t want to jump the gun and just run away with it because there’s a lot of really good content here. So let’s go ahead and take our first profit break, right? Let those commercials come in. But when we get back, we’re going to talk about some ways that you can really dial in your savings, maybe reduce some of that debt and then get ahead. So that and more when we get back from our profit break. You guys are listening to the True Wealth Radio Show. I’m Matt Dickson.

00:11:01 I’m Justin Bruggeman.

00:11:02 And we’ll be right back.

00:11:05 All right, everybody, welcome back to the True Wealth Radio Show, where we have been talking a little bit about how you might rethink the whole wealth building experience because things are a little bit different today than they were just a few years ago. Justin, I wanted to cut to an early break because we need to talk a little bit about debt management and there’s a lot surrounding us, right? So the first thing that kind of comes to my mind is the fact that most Americans, so on average, have about six grand in credit card debt.

00:11:42 Yeah.

00:11:42 Okay. And that to me, I’m looking at that number, right? I’m thinking to myself, that’s actually not insurmountable. Right? Like if you make some lifestyle adjustments, six grand can get paid off faster than you might think. It might seem like a lot, right? Especially if we’re kind of paycheck to paycheck. But we talked about, you know, working on saving more practical ways that you can adjust things. And so I look at this and say, if you’re going to attack that credit card debt, that can get you onto the next phase of saying, let’s save more. And there’s another interesting thing that I didn’t really know. Did you know that about 20% of people who asked for a lower credit card interest rate got one?

00:12:34 I did not know.

00:12:35 I didn’t know.

00:12:36 I’ve never even heard of such a thing.

00:12:37 Right, just call up and start negotiating your interest rate. That seems wild to me, but it might be worth it, right? Because if you’re getting hit with 30 percent interest on $6,000 and you can just call and negotiate that interest rate down to say 20, that could be a really big deal for getting yourself out of the hole a little bit faster.

00:12:59 And I think it even comes down to what the debt is. Everything has been moved to, like mobile apps and things like that, which a lot of them, it’s just going to map out and you’re going to have the minimum payment because that’s what you owe. You make minimum payments on credit cards, it’s going to take years.

00:13:18 And some people don’t understand that.

00:13:19 Yeah.

00:13:20 And so yeah, if you’re going to do the minimum payment, you’re always going to have that credit card debt. And, you know, I’ve actually talked to people recently who have told me stories like, hey, I’ve got twenty thousand dollars in savings and I’ve got this ten thousand dollar credit card bill that I keep paying the minimum on.

00:13:37 Right.

00:13:37 And I’m like, maybe you need to look at just paying the credit card off so that you can grow your savings faster because if you’re, you know, accepting that only $50 a month as an example is going to the principal and 150 is going to interest, you’re kind of burning that $150 every month where you don’t have to. And so I think ratcheting down on debt and really attacking it aggressively is something that a lot of people kind of just get lazy at.

00:14:08 Yeah. And there’s a couple, kind of ways to attack it. The most common one is, you know, Dave Ramsey, the snowball thing.

00:14:16 Sure.

00:14:17 If you have multiple cards, you eliminate the lowest or the smallest amount, one first and then you use that money plus the minimum payment on the next one and you keep growing and growing.

00:14:30 Right. And there’s exceptions to it too, right? Because like say you have a, say you finance something that was $200 at 1%. But you’ve financed $10,000 at 12%.

00:14:44 Right.

00:14:45 Who cares about that small one, as long as you’re not defaulting on it. Let’s attack the one that’s really dinging you.

00:14:56 Most of the time when people get into the trouble, it’s because they’re irresponsible with the credit cards.

00:15:03 Right.

00:15:03 And so it’s a way to, you know, you’re shrinking down the amount of credit cards you have because if people had access to it, they’ll access your entire credit.

00:15:12 So you’re saying if you have four credit cards and you pay off one of them and you feel good about it, maybe it’s okay to shred that card and be done.

00:15:21 Or put it in the glove box or something. So you’re not easily accessing it. Because that’s what’ll happen, is even somebody will sell a car or something like that and we’ll eliminate a whole credit card. And then they’ll turn around and charge on the credit card.

00:15:36 Yeah. I mean, the reality is, we talked about this before, budgeting, how important that is. I mean, you’re one and a half times more likely to save money every month if you’re budgeting someone who’s not. And so just actually looking at the finances, looking at the budget and saying, kind of where, can we be and trying your best to stick to that, just that alone is gonna cause you to save more money.

00:16:02 Right.

00:16:03 So that is a big deal. So I like that. So you mentioned one of the things was using, like, a snowball effect to kind of reduce your debt load. What are some other things that you can kind of think like along the line of debt?

00:16:19 The one that mentally has me is I would mentally want to pay off the most expensive one first.

00:16:25 Okay.

00:16:26 So–

00:16:26 Like get rid of your largest payment first.

00:16:28 No, your largest, whatever’s costing you the most in interest. So say you have a 28% credit card, a 20% credit card, you know, a 9%. Mentally, my mind wants to go, okay, pay the one that’s costing me the most money. Because if the interest is higher, you know, your payment is doing less.

00:16:49 Okay.

00:16:50 And so that’s another kind of, but that’s also don’t, if you pay it off, don’t rack up the other ones.

00:16:58 Hmm. Like, yeah, so basically some people can make the mistake of being so aggressive towards one that they let the other ones take up a big bill. And then you’re right, kind of back in the same spot that you started.

00:17:13 And even like, I think how you operate is you put a lot of things on credit cards and you pay it off every month.

00:17:18 Right. And that’s just something where I’m like, no matter what happens. You know, I’m going to figure out a way at the end of the month to take care of that bill, because I want the points. And I know that I’m going to spend the money regardless. And I’m not someone who you, like, abuses the credit card. I’m going to spend the same on a credit card as I would on a debit card or if I had cash. And so I just look at it. And I think that’s another thing, because I mean, look at what the theme of the show was, you know, kind of changing the way you think about money, because times are different. I’ve always got like $100 a month coming in at Amazon. Easily, if not more than that. And so if I’m letting my credit card give me $1,500 of free money every month, and I’ve never once paid a dime of interest on it, I’m like, I’m beating the system. And if you can beat the system, do it. There’s a lot of ways to, where you can use the system in your favor if you’re being, you know, really cautious and also savvy about it.

00:18:22 And if you don’t have the discipline to do it, and you still want to be putting things on credit cards and pay it every month, go change your limit. So say it’s, go get a card and say, I only want a $3,000 limit or whatever it is.

00:18:39 Yeah, and it doesn’t have to just be credit cards. There’s so many other ways that you can save. I know for you, one of the things you love, your coupons when you go to get your oil changed, you don’t ever pay full price for an oil change. And you’ve got your 40 or 50% off coupon, you go in there and you get it cheaper. And some people don’t do that. They just don’t.

00:19:00 It’s just cheaper than me doing it myself.

00:19:02 Right?

00:19:02 That I can find a way to do it.

00:19:04 Yeah. And so, and for me, I love couponing before I go grocery shopping. Because, and I actually, like my wife, yeah, she’ll clip like three coupons and then buy everything that she needed for the month. And I’m like, when I go in there, I only buy the stuff that’s on sale because I can’t pay full price for it. And I’d rather go to the other store. Now, am I actually saving money? I don’t know. But it sure feels like it because, you know, when I go in there and I get a hundred dollars worth of groceries for 40 or 50 dollars, that’s to me a pretty big win. So there are ways if you want to be savvy, you can be savvy and change. Because think about it. You only have so much income every month.

00:19:45 Yeah.

00:19:47 It’s gotta be spread out over a lot of different places. And for every dollar you save, that’s another dollar you can spend somewhere else.

00:19:55 And there’s a lot of unexpected expenses that happen. So having an established emergency fund. So that way, when you have your budget, you know, a car, new tires, doesn’t blow up your entire budget, you have that extra side.

00:20:13 I’m thinking about getting into pet insurance for my own household. Man, vet bills. That’s one that I had to deal with recently, right? Like a really large unexpected vet bill. And it was one of those things where you’re never, like wanting to spend that type of money, but the animal is part of the family. Right. And so I’m glad that I had a rating day savings fund because that type of thing, you don’t want it to go on the credit card and stay there.

00:20:48 Yeah.

00:20:48 Right. And so I think that’s a big one, is looking at, are you properly insured? Do you have health insurance? Because if something happens and you get really, really sick and you’re in the hospital for a couple of weeks and you didn’t have the savings and you didn’t have the health insurance. And a lot of people, right, they get complacent with their job, for example. They don’t really love their job, but they go and do their job and the job isn’t paying them what they need to be paid and it’s not giving them the health insurance that they need and they just continue on when it’s like, hey, you know, you’re capable of doing more or doing something that you actually enjoy more, where there’s more benefits. So I think it’s really important for people to look at that and say, things have gotten more expensive, am I properly insured? Am I, you know, do I have a good savings fund on the side? There’s a lot of different things that you can do to put yourself in a better situation.

00:21:47 Well, I think it’d be this way too, is, we preach about it all the time, the benefit of compound interest, you know, starting early for, you know, and often, in a long time. That’s how credit card companies make money. It’s just the reverse.

00:22:02 Oh. Yeah.

00:22:03 So if you’re extending things out longer and paying a higher interest rate, the amount you’re going to pay goes up drastically.

00:22:12 Right. Yeah, no, that’s true. But, you know, for the small business owner out there, right, like we’ve been kind of just dinging debt and saying about all the horrible things that can surround it. But there’s also ways to leverage debt for good. Right. Like if you’re a small business owner and you can take out a loan and that loan is going to expand your business to where now your revenue is up 200 percent. Okay, well maybe that loan was actually worth it because it’s bringing more money in for you every month.

00:22:48 Sometimes you have to spend money to make money.

00:22:50 Right, and so I’m not saying never spend any money, but be smart about how you do it. That’s really the underlying thing.

00:22:57 We’re not even saying don’t ever go into debt.

00:22:59 No. No.

00:23:01 Being responsible, debt ownership is still fun.

00:23:04 Right. Yeah.

00:23:05 And in discipline.

00:23:07 This is a question I always like to ask. Is the debt that you’re taking on a liability or is it an asset, right? Now, odds are if you bought a vehicle, probably more of a liability. It’s depreciating. There’s maintenance costs, but you got to have it. Right. So that’s one where it’s like, even though it’s not an asset and it’s more of a liability, it’s a needed liability because that liability gets you to your job and allows you to make the income that you need in order to have stuff, right? And so that’s one where it’s like you really got to weigh it though because you’ll see someone go buy a toy on credit and be like, oh, but you know, this is just my lifestyle. I’m like, well, that’s where we need to actually kind of reconsider.

00:24:00 And if you want it bad enough, you’ll justify the reasoning for buying it. You’ll just switch it to a way that it makes sense.

00:24:06 And if you want it bad enough, you’ll save for it. That’s the reality. Like, I think the days of like, pay for it in cash, like we’ve gotten away from that mindset. We’re the, we’re this generation of just put it on the credit, forget about it, let’s deal with the monthly payment.

00:24:25 Right.

00:24:25 And so I like the old school kind of mentality of let’s pay cash. So, all right. Well, Justin, other thoughts on debt before we kind of move along?

00:24:43 It can be done.

00:24:44 Yeah.

00:24:45 And if it’s something you’re struggling with, either ask for help or just budget yourself and force yourself to do it.

00:24:53 Don’t be afraid of automating some things too. That’s one thing where I look at this and I’m like, how many people fall behind on their payments because they simply forgot that they had a payment due? And then they’re like, oh gosh darn it, interest is owed. And then it’s like continually forgetting about stuff. There are so many ways to automate stuff these days, right? Like whether it’s, put a reminder in your calendar, so auto pay, there are so many different ways that you can make it to where it’s not a mistake.

00:25:27 And you can say, I think most bank accounts anymore, it’ll auto save. So maybe a certain amount of money that comes in and goes transfers to savings.

00:25:36 Right.

00:25:37 There’s millions of tools out there, but if you’re not going to, putting the effort to do it.

00:25:43 Right.

00:25:44 Then you’re gonna keep going down the same hole.

00:25:46 Exactly, exactly. Okay, well enough about debt. Justin, let’s take another profit break. And when we get back, we’re gonna kinda talk a little bit about kinda designing your lifestyle so that you do have some of that financial freedom and what that really looks like. So you guys are listening to the True Wealth Radio Show on 93.9 FM and 1240 KQEN. We will be right back. Stay tuned.

00:26:12 All right, everybody. Welcome back to the True Wealth Radio Show. I’m your host today, Matt Dickson.

00:26:18 And Justin Bruggeman.

00:26:19 And we have been talking about changing up your lifestyle to meet the kind of needs of today’s economy and all the other stuff that’s going on where everything might feel overwhelming, but we’ve got some practical ways to maybe help you out, help you navigate to where things don’t seem maybe so frightening or so scary. We talked a little bit in the first half of the show about, kind of rethinking how, do you build wealth and tackling debt, we talked about that a little bit. But on the second half of the show, I really wanna talk about Justin, designing that lifestyle so that you’re successful. And one of the main areas that I kinda wanna talk about is living large on less. There’s a lot that goes into that. Do you kind of want to talk a little bit about what that means to you?

00:27:13 It’s the want versus the need for me. It’s, do you need the brand new vehicle? Do you need the brand new shoes? Do you need the popular cup?

00:27:23 Right. Because sometimes we actually just kind of, I think we turn off. How much does that actually cost me compared to something else? Right. Like here’s this SUV. It’s 40,000. And it’s got all these cool things like the sunroof and the leather seats. Here’s this other SUV and it’s got the cloth seats and no sunroof and it’s $7,000 less. It’s like, how long would it take you to save $7,000? And is the sunroof and the seat difference really, really worth it? That is part of it. But I look at it from almost a different lens. So when I think of this whole concept of living large on less, that kind of takes my mind into this, the space of maintaining the things that we own, right? Because some people, they are just hard on stuff, right? And they’re always replacing. And the cost to replace something that could have been maintained a little bit better is really expensive, right? Like, and you’re probably thinking, yeah, okay, I’ll change the oil in my car more or whatever the case is, right. But I’m talking about even down to the small things that you wouldn’t even think about, like shoes. Pick on my wife for a moment. I’ll get her a brand new pair of shoes. And like a week later, they’re thrashed, right? Like they’ve been in the mud, like they have been abused. And I’m like, geez, that was a brand new pair of shoes. And, but I’m like, super meticulous. I’ll think about what, am I about to go do? Like, oh, I’m about to go paint. I’m going to wear my worst pair of shoes or I’m going to go mow the grass. Can’t get green stains on the shoes. And so like I’ll have a pair of shoes that’ll last eight, nine years.

00:29:12 Yeah.

00:29:12 Right. Because I have a lot of pairs of shoes, unfortunately, and I’m super, super nice to them and I’ll clean them off when I’m done with them. So like a pair of Romeos for me, oh, those will last five, six years. Easy. But I also oil them. I have a special little beeswax where I like, treat the leather every year. And then some people, they get them muddy, they throw them in the corner and then the leather cracks and they’re done in six months. So if you’re a little neurotic, because I see Justin over there laughing, like, oh, you’re a psychopath, Matt. But if you’re really taking care of your stuff, then your stuff can last a long time.

00:29:53 I do agree with you. If you take care of this stuff, it’ll last long.

00:29:57 Right. And then you know–

00:29:58 I can argue some of that.

00:29:59 Yeah.

00:29:59 For sure, the Romeos. I’m like, well, how much time did you spend over those five years oiling and taking care of them to go buy an $80 pair of shoes?

00:30:09 Yeah.

00:30:10 I don’t know. But which in my life is the exact opposite of her shoes. I bought her shoes. I don’t have a problem buying my wife’s shoes because I bought her shoes that are just 10 year old shoes that look brand new.

00:30:21 Oh, yeah.

00:30:23 I’m horrible on shoes. So I never buy shoes. My wife buys me shoes, but I won’t buy them because either, just a tool. They’re just going on your feet. And then when they wear out, as long as they don’t look horrible, then they’re fine. But I’m the same way kind of, with vehicles are ones, it’s hard for me because I can’t justify a new vehicle purchase, a brand new one. I just can’t mentally wrap my head around it just because, not only the cost of them, but how much they depreciate in value.

00:30:52 See. And I’m the opposite of you because I love a new vehicle, because I hate maintaining vehicles. I hate having to pay for new spark plugs or engine rebuild. And I’m like, well, I’m gonna either pay the payment every month or I’m gonna pay it on the used rig to keep it running. And so I’m like, well, if I feel like I got a good deal on a new rig, like I got it at a pretty good discount off the lot, I’m like, ah. I’ll use it for a while and either sell it or keep it until it blows. So, but I get where you’re coming from.

00:31:30 That’s how I–

00:31:31 There is depreciation when you drive.

00:31:32 That’s how I am differently, like going and buying a brand new SUV because just where our kids are at in life.

00:31:38 Yeah.

00:31:39 I probably don’t need an SUV seven years from now.

00:31:42 Right.

00:31:42 So it’s hard for me to go and spend that much money and have it because I don’t plan on having it that long.

00:31:48 Mm-hmm.

00:31:48 But I could justify going and buying a brand new pickup, even though they’re more expensive.

00:31:53 Because you’re going to use it your entire life.

00:31:54 But I’ll have it 20 plus years.

00:31:56 Yeah. It makes a difference.

00:31:58 That’s a weird, it’s a mine screw on.

00:32:01 Yeah.

00:32:02 It’s hard to purchase things because, and also to me, it’s cars or tools.

00:32:06 Right.

00:32:06 You know, I drive a little Honda back and forth.

00:32:07 Oh, I’m the same way. It is totally a tool.

00:32:10 It’s 40 miles a gallon, it’s great, and it runs. Yeah. It’s not pretty.

00:32:14 And it really depends on the situation you’re in. There was a timeframe where we were down to two rigs. One of them wasn’t super reliable. We could have bought a new rig, but an opportunity came up for a used vehicle that was being sold at such a low price. Even if the motor blew up, it wasn’t gonna harm us, right? And so I’m like, let’s buy this really cheap vehicle and let’s plan to have you drive it two or three years until we get something else. We actually made money on the vehicle. We bought it at such a cheap price. We drove it for like three years and sold it from more than what we bought it for. And… but then a kid comes along. We needed a reliable vehicle. We live in Oregon where it’s icy and the weather can be horrible. And I’m like, Hey, I don’t want you and my six month old baby at the time to be stranded alongside the road in the middle of the winter. And I’m six by six. I can’t even drive your car with a power seat in the back. So it’s like, yeah, we got to get something. And at that point, COVID, right? Like COVID is a thing. Used cars were selling for what a new car was worth. So I looked at it and I’m like, well, at least if I buy the new one with an unlimited mileage warranty, yeah, I’ll take that and just make the maintenance someone else’s problem. It really, really depends. I think the key point here is, be really tactical and smart about the decisions that you make, really stop and think about it. Some people are very, very impulsive. They see something, they’re like, yup, doing it. And I’m like, how long did you want that thing for? I wanted it for a full five days and then I got it. I’m like, hmm.

00:33:58 The biggest way to save some money, if you can do it, which my family has a very hard day with this, prepping what you’re gonna eat for.

00:34:09 That will save you so much money.

00:34:11 It’s insane.

00:34:12 Yeah. Like if there’s an actual menu.

00:34:15 Yep, our family is not really built like that because it’s all, impulse on what we kind of want now.

00:34:21 Right.

00:34:21 And so then instead of one trip to the store on say a Sunday, it’s four trips to the store during the week.

00:34:27 And then you see that one thing while you’re just shopping for your three items and you’re like, well, of course we need that. It happened to my wife the other day. She bought a thing of milk. I had two new ones in the fridge. It’s like, whoa, but she was there for a couple things and she just thought we needed milk. And so, no, it’s a real thing.

00:34:45 And you brought up the living large unless the–

00:34:51 That whole concept of like, there’s a whole substitution.

00:34:54 The vacation part. You know, the European vacation versus the cruise.

00:34:59 Mm-hmm.

00:35:00 You know, it may be a… turn to $15,000 vacation into a five.

00:35:06 Right. Yeah, just figuring it because here’s the reality. Like I look at the whole vacation thing and I think a lot of people do it for their Instagram account, right? Like well, I’m going to go on this crazy expensive vacation to this crazy exotic place or whatever. It’s like, well, because they think that they can or they think that they should or whatever the case may be. The reality is, what are you doing on vacation? You’re spending quality time with someone that you love most of the time.

00:35:35 Most of the time.

00:35:36 Most of the time.

00:35:36 Or money. One or the other.

00:35:38 Yeah. So I look at this and I’m like, find a vacation that you can afford because the last thing that you really want to do is just go spend a bunch of money that you didn’t have for five days in paradise and then come back to reality. And it’s like, gosh darn it, what did I do? So there are ways to have cheaper vacations. Get some good friends and split the cost of the Airbnb, that’s one of my favorite ones, right? Like my friends are listening, they know exactly what I’m talking about. It’s like, hey, get a group of people. One time we went over to Bend Sunriver, it was a super expensive place. It was super nice. But we had like four couples. It was a four bedroom place. We all split it. And it was very cheap. And we got to live the life of luxury for a weekend. So like, figure out the ways to make it work. I’m not saying you gotta like go, live under a rock and not do anything with your life. Go live it up, especially, you know, while you’ve got your health, while you’ve got the ability to do it. But just do it in a smart way. Be savvy. Look for ways to save.

00:36:47 Even though I mean, I know we kind of complain and tell people to save more and save more, and economically the last couple years.

00:36:54 Yeah.

00:36:56 It’s made it, hardest, it’s probably ever better.

00:36:58 Yeah.

00:37:00 And those people that were the avid savers prior are the ones that aren’t feeling the pain that everybody else is feeling.

00:37:09 Right. Yeah, you know, one that we had on this list to talk about was kind of taking care of your health a little bit too. And, you know, getting those regular health screenings, being physically fit, exercising. That’s a big piece of it too, right? Like you want to go experience all these things and do all these things and make your money work for you. You’ve got to be in good enough shape to make your money work for you. And that’s what I struggle with. I hate going to the doctor. I hate getting my blood work done. I will refuse it, refuse it, refuse it. And so this is gonna sound definitely a little hypocritical, but if you can go in there and get a health screening, it might not be a bad thing because if you catch something early or you get out in front of your health, I had a family member who went in, got some blood work done early, 30 years old, pre-diabetic, right? And so cut a bunch of sugar out, getting ahead of the thing. If you can do it, it’s a good option. So.

00:38:16 Health is, can be the same thing with finances. If you don’t take care of it early and often.

00:38:22 Right. That’s true.

00:38:24 It can cause more damage later.

00:38:27 Right. And be more expensive.

00:38:28 Yes.

00:38:29 All right. Let’s do this. Let’s take our last profit break. And when we get back, we’re going to talk about the little sneaky thing that isn’t talked about enough. How do we share that wealth? Right? Because build it, build it, build it. Let’s figure out ways to use it and use it in a good way. That more, when we get back, you guys are listening to the True Wealth Radio Show on 93.9 FM and 1240 KQEN.

00:38:56 Alright, everybody, welcome back to the True Wealth Radio Show. We’re in the homestretch where we are going through all the stuff that you need to know in today’s modern financial landscape. Justin, thanks for joining me today. It’s going to be tough. We’ve kind of talked about just ways that you can get through it today and be more successful given all the challenges that we’re facing. Talk to me a little bit about this last segment, right? Where it’s like, we’ve really talked about getting out of debt. We’ve talked about saving more or saving in a better, more efficient, smart way. How do we get to a point, to where we’re sharing that wealth or we’re being kind of generous and what are some ways that we can do that?

00:39:46 So we spend an hour talking about how to stop spending money.

00:39:50 Now we’re gonna–

00:39:50 Now we’re gonna talk about how to give it away.

00:39:53 Yeah.

00:39:53 That makes perfect sense. That’s pretty crazy. You know, the biggest one, I guess, even that we deal with that has a drastic impact is just charitable giving.

00:40:05 Yeah. And one thing that comes to mind when I think about giving, especially if you’re invested in the stock market, right? Because that’s kind of the core of our business, right? We’re investors. We’re investing money into either some real estate stuff, so the stock market, bonds, fixed income, whatever that is, we’re investors. And by nature, our default, I think, is to stay invested, keep saving, keep plotting along, but there comes a time where it’s okay to start handing assets over or blessing others, right? And one of the things that we talk about, that I feel like people don’t just inherently know, they ask, is it a good time for me to give money away? And I look at, and I just had this conversation with someone recently. I’m like, hey, your account is way up, right? The markets have been very generous. You are invested well. You have a really, really large gain over the last few years. It might be an okay time for you to go ahead and do that gifting that you have been wanting to do for a really long time, because your accounts have doubled, right? Like they’re way up. Go ahead and give to that son or daughter or whoever it is that you had in mind. Maybe it’s an okay time. And then, you know, when the markets are down on the contrary, maybe that’s a good time to just ratchet down, save more, put more into investments because, you know, things are kind of rough and beat up. And then when things get better, you look at it as gifting.

00:41:49 Yeah, that’s a matter of trying to keep it within the budget and budgeting for it.

00:41:55 Right.

00:41:56 And if it’s of an importance to you, then you should do it but do it responsibly.

00:42:02 Right, like if you gift to the point to where you’re homeless, that might be ill-advised, right? I know that’s a radical example, but some people will literally kind of just ruin their own financial state trying to be generous when there wasn’t an ability to. And so I think that’s part of the planning too. It’s like, what can you do? Because sometimes you can give way more than you thought. Right? Or you hadn’t thought about what happens when I die and then it’s time to pay estate taxes. I could have, gave this stuff away earlier and then skipped my estate having to pay a bunch of taxes. So it’s a really, really big conversation. And if you need someone to talk to, we are available, right? And we might not be able to help you invest. That’s okay. But we at least want to kind of point you in the right direction and get you to a place where you’re better than when you called us originally. I can’t tell you how many times that happens. I answer a phone call, I know for a fact that there’s no way that we ever do business, you know, but that’s okay, I’m gonna help you out because I just want to, so.

00:43:17 Doing the right thing comes back around tenfold.

00:43:19 It does.

00:43:20 It always does.

00:43:21 It really does, and if you need help, you can always just shoot us an email at [email protected]. You can text us or call us at 541-375-0898. There are a lot of ways to get a hold of us. You can just go to our website and chat with us.

00:43:40 And there’s a lot of tools that are available there that can answer some questions.

00:43:44 Yeah, if you can answer the question yourself off of all the tools on the website, good on ya. That’s awesome, we like to hear that. If it’s something where you really need to speak to someone, we’re not scary people. You can call us and we’re not going to be high pressure sales. Like you’re not going to get that pitch, right? Like we’re just here to help in ways that we can. And if we can’t help, that’s okay too. So–

00:44:08 It does happen.

00:44:09 Oh yeah, it happens. Because we’re really not cut out for everyone, right? Like the industry has changed. If you’ve got $5,000 to invest, we’re probably pretty expensive. Right? Like there is, it’s just a lot. So we’re going to point you in the right direction, hopefully get you the tools that you need. And we stand here, we want to help you guys out. So I think the summary of today’s show is really just let’s figure out a way to be better stewards of our money.

00:44:43 Yep.

00:44:44 And we know that times are hard. But that’s why people are out there to help. So maybe we’re that person. Justin, we’re running kind of long on time here. So 541-375-0898. Little John Financial here to help you guys out if you need it. Until next week, I’m Matt Dickson.

00:45:02 And Justin Bruggeman.

00:45:03 You guys are listening to 93.9 FM and 1240 KQEN.

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