Learning a new language is difficult, and the language of money is no exception. Brian Preston from The Money Guys has created shortcut words and phrases like “financial mutant” to help you focus on what’s important and ignore the rest. We’ll discuss how to get started, the key moves to reach long-term goals, how to avoid making costly mistakes, and more. Whether you’re someone just beginning your journey or a seasoned investor, there’s a little something for everyone every time we speak with Brian.
In our headline segment, a publication decided to ask AI (Chat GPT) how to beat the stock market. The AI responded with advice, which we’ll dive into thoroughly to see if this is the wave of the future. Even better news: beginning this week, we’ll track this AI driven portfolio to see if it truly is a better way to invest than a collection of index funds (or just one index).
But that’s not all. We also answer a question from a Stacker AND Doug shares his amazing trivia.
Deeper dives with curated links, topics, and discussions are in our newsletter, The 201, available at https://www.stackingbenjamins.com/201
Enjoy!
Our Headlines
Brian Preston!
Big thanks to Brian for joining us today. To learn more about Brian, visit Money Guy or The Money Guys YouTube page.
Grab your copy of his newly released hit book, Millionaire Mission: A 9-Step System to Level Up Your Finances and Build Wealth.
Doug’s Trivia
Which of these Italian Renaissance artists’ work has sold for the most amount of money: A: Leonardo DaVinci, B. Michelangelo, C. Raphael, or D. Donatello?
Better call Saul…Sehy & OG
Stacker has an in-depth question about a 529 Plan for his son, and what to do if his son decides not to go to college.
Have a question for the show?
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Written by: Kevin Bailey
Miss our last show? How We Think About Debt (SB 1522)
Episode transcript
[00:00:00] Joe: Do, do you want me to wait for you? [00:00:02] OG: I put a giant scoop of crunchy peanut butter in this cake batter that they call breakfast because it’s got protein [00:00:10] Joe: cake batter with chocolate chips. Well, let’s [00:00:13] OG: be clear, it’s a giant piece of chocolate cake that I added a giant scoop of peanut butter too, and for people, I’m calling it breakfast [00:00:20] Joe: people not hanging out with us. [00:00:21] You cannot see that OG has what looks like a, uh, a pint of Haagen-Dazs in front of him at 9:00 AM they’re called [00:00:28] OG: flapjacks. So obviously that’s breakfast. Uh, of course. Chocolate peanut butter, Kodiak cups. If you don’t have them in your closet, you are missing out. [00:00:37] Joe: Well, this is what you do on a holiday in America, right? [00:00:39] I mean, it’s Memorial Day og. So you’re sitting back and enjoying your cake batter. Healthy breakfast of cake, [00:00:46] OG: peanut butter. [00:00:48] Joe: It’s a great way to, but it has [00:00:49] OG: chocolate in it, so that’s good. [00:00:50] Joe: Great way to honor this, uh, holiday of Memorial Day. [00:00:54] OG: Why don’t you kick it off while I, uh, finish up a spoonful of peanut butter? [00:00:57] ’cause that’ll be easy for me to talk with. [00:00:59] Joe: Deal. Well, I was gonna say that another way we honor it. Obviously we wanna honor the men and women keeping us safe in our armed forces while we honor this, uh, Memorial Day holiday. And so I’m generally, we raise a glass. Oh, she’s raising the Haagen dot, the flapjacks, [00:01:14] OG: the spoon of cake, [00:01:16] Joe: and I, and I’ve got my simplify [00:01:18] OG: Marines [00:01:18] Joe: Ferrari mug because our troops are like a Ferrari. [00:01:22] On behalf of the men and women making podcast of Mom’s basement and the men and women at Navy Federal Credit Unions serving our troops, here’s to you. Thank you for all you do. Now let’s go stack some Benjamins together. [00:01:40] Doug: Live from Joe’s mom’s basement. It’s the Stacking Benjamin Show. [00:01:54] I’m Joe’s mom’s neighbor Doug, and on today’s Memorial Day episode, let’s learn how to shake up your saving strategy and view the financial world like a Money mutant with the host of The Money Guy podcast. Brian Preston plus one publication recently asked AI to pick a portfolio of stocks to beat the market. [00:02:13] What did it pick? We’ll share those gems and what we think about the output in today’s headline, and then we’ll answer a question from one stacker who thought, you know what? I’d better call Saul. See hi and og, and of course I’ll share some pricey trivia. And now here comes the most cold-blooded member of the Stacking Benjamins team. [00:02:36] And Joe Sa Sea High. [00:02:41] OG: Have you ever tried to fashion a sentence after eating a tablespoon of peanut butter? It sticks everywhere. I know why dogs like it so much. They’re just constantly, you know, slurping down peanut butter. You should try APO then. Dude, that’s the next step. Hey everybody, this is how, this is how Mrs. [00:02:58] OG gets me to take my medicine. She just like puts it in a scoop of peanut butter every morning. [00:03:02] Joe: That’s it. Just take it. And then OG can’t figure out why he sleepy all day and he’s always got a pen in his hand sign and stuff. Hey everybody, welcome to the takeover, the World while OG Sedated podcast. I’m Joe Saul-Sehy ever Joe Money on Twitter X and across the card table from me. [00:03:18] This fine holiday weekend, uh, extended weekend. It’s Mr. og, uh, you’re, you’re getting double pay, I think, OG for working on a holiday. [00:03:27] OG: Yeah, obviously [00:03:28] Joe: it’s fantastic and we got a great show. Another guy working overtime for us is the man we love. This guy Brian Preston from The Money Guys, uh, joins us and I, I think he might be present company excluded. [00:03:42] The nicest guy on Earth. [00:03:43] OG: No. Included. Definitely one of the, it’s far better than we are. Trust me, I’m not on that list. I know my role. [00:03:52] Joe: We got Brian Preston talking about becoming a financial mutant. We’re gonna talk about some of the crazy mutant. Yeah, Brian, as you know, Brian and Bo over at The Money Guys, uh, they have some crazy vocabulary words. [00:04:04] We’re gonna go through their vocabulary today and teach you a little something, something about, uh, about really getting started and getting your money in order. But before that, we try to do two things. Number one, we try to make sure that this is free. Well, we don’t even try to make sure we make sure that this is free, so we can help you get where you wanna go. [00:04:21] And that means we’ve got some fantastic sponsors that sponsor the show to make it free. We also make sure that the second half of this show is always ad free. So for that reason, hang out with us for just a couple seconds and give thanks as well to the people that help make this free. Huge thanks to them. [00:04:39] Huge thanks to you for hanging out with us on a holiday. Brian Preston waiting in the wings, but we got a great headline first. So let’s get rolling. [00:04:47] bit: Hello darlings. And now it’s time for your favorite part of the show, our Stacking Benjamins headlines. [00:04:54] Joe: Our headline today comes to us from a website called Fin bold. [00:04:58] Fin bold f bold.com. F Bold did something very bold, OG they decided to get AI involved in the investing game. Mm-Hmm. Um, for people that don’t know that OG iss not even here right now. Oh, scar [00:05:09] OG: Johansen. [00:05:11] Joe: That was a good movie. I like that movie. [00:05:13] OG: Have you seen the new, or have you tried the new chat? GPT where you get to talk to it and it like a toxin, but it’s, they ripped off Scarlett Johansen’s voice and [00:05:22] Joe: Scarlett Johansen is, uh, fighting back as we record this. [00:05:24] She’s suing them. Yes. Yeah. Yeah. She’s su them. Yeah, no, I, I was thinking about that scar Joe, [00:05:27] OG: as I call her buddy. [00:05:28] Joe: Yes, because you guys are buddies. I was thinking about that movie where she plays the AI in, um mm-Hmm. In Joaquin Phoenix’s Ear, which is a great called her movie’s called Her. That’s right. But yeah. [00:05:39] Uh, so they got chat, GPT involved with creating a portfolio. This, uh, piece is written by Dre Hasanovic. Say that three times. Andrea writes, the stock market has overall been doing well, been doing well, [00:05:56] OG: been doing okay. As [00:05:56] Joe: we’re recording this, I think we’re at all time highs with, uh, with the Nasdaq, the SP 500 and the Dow, which is a great place to be. [00:06:03] Yeah, that’s okay. Yes. With it’s, this says with the SP 500 Dow Jones continuously rising, with the exception of a brief correction. This, this year, was it a correction? I don’t think it was enough. Was it enough to be a correction? [00:06:15] OG: No, not [00:06:16] Joe: went down. Went down slightly. But anyway, we, we quibble. Nevertheless, he writes, there have been some caveats, this performance. [00:06:22] With one of the biggest, and perhaps most worrying given the historical parallels being that much of the rise has been driven by a handful of mostly tech stocks, which have in some cases seen three digit surges in 2024. Under these circumstances, the strategy most commonly recommended regular investors by Warren Buffet is an investment in a broad index fund. [00:06:41] He has the hot take, he says that may not be the best option. And F bold and in search for strong portfolio compositions decide to consult the most advanced version of open AI’s flagship artificial intelligence chat, GT four. So they asked chat GT four to create a portfolio for the emoji. Hmm. Okay. And what’s interesting is Chet, GPT said. [00:07:03] Well, first of all, what do you think that AI would say the best way to construct a portfolio would be, [00:07:09] OG: oh, broadly based diversified, blah, blah, blah, blah, blah. [00:07:12] Joe: Well, they actually said it should be broadly based, which is interesting because, so AI originally goes to what you and I know og, the diversification, whether you’re trying to make money, make or not lose money, still gonna be your buddy. [00:07:26] So AI immediately goes to diversification for the win. Yep. And I think this is an important point because if you’re trying to make money big time quickly and you’re trying to beat indexes, which is what this is trying to do, we’ll get to that in a second under diversify. ’cause if fewer positions you have, the more it’s gonna go up. [00:07:45] And conversely, of course, the more it’s gonna go down, you’re gonna have more what they call standard deviation in your portfolio. So if you’re trying to get rich quick. Under diversify, but OG I think people concentrate. Yeah. But I think people that are trying to get rich quick, uh, OG are missing the other half of that equation. [00:08:01] Like what comes up might, might not always go up. [00:08:06] OG: Yeah. Well, it’s funny if you look at the large amounts of like insanely wealthy people, right? CEOs, and I’m talking about people with hundreds of millions of dollars and, and obviously if you’re, if you’ve got a couple million dollars by, by all calculations, you’re also insanely wealthy. [00:08:23] But I’m saying like, you know, crazy, like a hundred million dollar people. So there’s super concentrated in one thing, right? They started a company and all of their money went into building that company and being successful Amazon, right? Or Microsoft, or they were professional athletes. All of their energy went into that one particular thing, which is great because if you are successful in creating the next Amazon, you will be as wealthy as. [00:08:51] You know? Yeah. What’s his name? One guy. One guy. [00:08:55] Joe: That, that B word. [00:08:56] OG: Yeah. But what people miss with all of that is all of the chances or all of the times where the, the stories get blown up. You know, it’s like how many Amazons were there before? There was Amazon? How many Amazons were there after Amazon that we don’t know about That just nuked financial success. [00:09:17] And you know, Warren Buffett says if he was investing, he would just diversify it. He’s told his wife to diversify. Well, yeah, if you wanna stay rich, then you diversify it into an s and p 500 fund, right? Like you just go, I’m taking all my, all my, you know, my marbles and I’m going home. And you see this a lot with people who have like stock options, or they work in tech and they work for a small company that’s a startup or something, and they’ve got these 1 cent options that have so many of ’em, and then all of a sudden the company goes public and they’re worth three, four, $5 million. [00:09:47] And the hard part. Is diversifying then, not earlier, because when your stock goes from $2 a share to $3 a share to $30 a share, you think it’s gonna go to 60. And there’s plenty of stories and, and plenty of people listening today who are like, yeah, I remember that, that was me. I, I had stock in such and such a company. [00:10:07] It went up, you know, 10 x and then, and then got cut in half. Again. The important piece with this is, you know, from an investment standpoint, is to have a plan before you need it. You know, you can’t make a plan in the heat of battle. You’re just reacting to what’s going on around you versus saying, I’ve got this, this asset allocation, I’ve got these stock option awards, I’ve got these RSUs, I’ve got whatever, and here’s my plan moving forward. [00:10:32] Then you can execute the plan even when things are going better than you anticipated or worse than you anticipated. But I’m kind of curious as to what the, uh, what chat GPT suggested we should do with our money. Well, let’s, or what they should do with their money. [00:10:44] Joe: Yeah. Yeah. Let’s go there. And by the way, before we do, I think you make an interesting point that even for Bezos Oji, what was he doing? [00:10:51] He was building, he was building a company. This is his profession. And we have said over and over and over that spending time making your portfolio, make money, make beat indexes, probably not as great a place to spend your time as is making more money from your profession, shoveling that into your, into your portfolio and having that be your driver. [00:11:15] Like for Bezos building, Amazon was his driver for heck. We could even take, uh, we, we could take the Dave, Dave Ramsey. Dave Ramsey gives a lot of advice on what to do with your money. That’s not how he became a bajillionaire. Dave Ramsey made a ton of money by building a company, by making his his profession go better. [00:11:36] Like if you’re, if you’re spending all your time day trading your account because you think that’s gonna make you a lot of money. It might be a better idea to refocus. [00:11:44] OG: Well, yeah, and just think about it just purely on the dollars and cents, right? Let’s say that you have an account that has 250 K in it, right? [00:11:50] And the s and p does 10% a year. So what would be your expected return if you just put it all in the s and p? You’d expect 25 grand, right? Like you’d expect to, that your portfolio would increase by 20 5K this year, right? And you can model that out and say, well, if every year it grows by 10% and I have 250, here’s what that looks like. [00:12:10] But now what happens if you add 20,000 extra of savings every year? So you go out and to your point, you spend all the energy you have in improving your skills, getting a better job, getting the promotion, making more sales, like whatever your job is, and you make incrementally more compensation, more income that you can then add to your Do nothing portfolio. [00:12:32] Now, what happens to your investment account in 10, 20, 30 years? It’s insanely different. By adding that little bit of extra versus saying, oh, I think instead of making 25 grand, I can do this stuff and maybe I’ll make 28 grand this year and I beat the index by by 2%, so I’m a, you know, I’m awesome. It’s like, no, put your focus on making 10 grand extra and saving it or 20 grand extra and saving it and see how that, that how, what that does to your models. [00:12:58] Joe: They gave chat GPTA thousand dollars and chat. GPT had this rationale. They said that for them they would pick one stock from seven different sectors, technology, healthcare, consumer, discretionary, energy, financial services, real estate, and basic materials. The AI reason that such a portfolio would check several boxes. [00:13:18] It would offer strong diversification. It would balance growth potential with stability, focus on industries likely to boom in the future, but it did go OG single stock. Now, what’s interesting about this before we get into it, is that as we get into these percentages. It also looked like the AI immediately OG went to modern portfolio theory, right? [00:13:38] Immediately went to the things like the efficient frontier and diversification along the lines that you would see a pro use. AI didn’t throw a dart, AI said individual stock to minimize your diversification or to concentrate more, but still keep all the different sectors and pick your winner in each. [00:13:57] And this is what they did, 20%. So 200 bucks, they went to technology as the prime driver and bought Microsoft. So Microsoft is the number one position in AI’s portfolio. Uh, number two, Johnson and Johnson, 150 or 15%. And they wrote that Johnson Johnson is a stable healthcare company of the broad product portfolio of pharmaceuticals, medical devices, and is strong financials and consistent dividend payouts provide stability with Microsoft. [00:14:25] They said they’re a technology giant because they have a presence in software, cloud computing and ai. And as a diversified revenue stream, it’s gonna be. Still growing solid long-term investment. Third Amazon, 15% into Amazon, leader in e-commerce and cloud computing. That doesn’t, [00:14:41] OG: that doesn’t count as technology. [00:14:42] I know, right? I mean, I mean I guess it’s an all in everything company now. Right? It’s also, I know consumer discretionary [00:14:48] Joe: technology. You can see the line blurred there. So AI might be overweighting then because of this pick, uh, toward technology, 15% to energy with a company called NextEra. Energy leading clean energy company, strong focus on renewables, um, looking at wind, solar battery storage, which is what it’s doing there. [00:15:07] And then, uh, 15% to Visa global leader in digital payments. I think everybody knows there. They also think that because it’s innovating and payment technology, it’s gonna continue to be a crucial player in the growing digital economy. Then in real estate goes to real estate, 10% to real estate. Prologis Prologis is a major player in the logistics real estate market betting, fitting for the growth of e-commerce and global supply chain. [00:15:33] So when it comes to real estate, they pick an area, again, OG that is technology related and growing in the future, but still interesting that they’ve got real estate as 10% of the portfolio there. Basic materials, Freeport McMoRan, and that’s 10%. Mostly focused on copper. So they’re going to minerals, right? [00:15:55] Mining often. And the things that they mine move a lot in lockstep. 10% there. Interesting. 10% to real estate, 10% to basic materials. A bent toward technology, that individual companies. Any thoughts? [00:16:14] OG: Well, it’s really interesting because one of the things that we kind of forget about is that whatever’s hot right now doesn’t necessarily always mean that it’s gonna be hot in the future. [00:16:25] For investors that have only been around for, let’s say the last 10, 12 years, there’s been two major declines in that period of time. 18 and 19 was roughly about 20%, I’m sorry, three major declines, COVID, which was for all intents and purposes of, of very small blip on the radar. You know, like when you look at the graph. [00:16:48] And then 2022, where the market was down 20 odd percent and then quickly rebounded. All of this has been led by, you know, in terms of the investment results have been led primarily by large US tech companies. So it’s okay to assume that this is all, you know, if you’re, you know, a 40-year-old and this has been the total sum of your investing career has been, well, I graduated college in 2010. [00:17:10] I finally got my act together and started saving in 2012 or 2013. And the thing that’s gone up the most is large US tech. That doesn’t mean it’s always gonna be the case. And what’s great about an ETF or an index fund is that it automatically cycles through those different areas that are overperforming and underperforming. [00:17:30] It’s self cleaning. If a stock doesn’t perform anymore, if it’s the Kodak of this generation, it just goes away. And you don’t have to worry about finding out later that pro Gentrix or whatever company they said, you know, isn’t a thing anymore. It was surpassed by another company. You’re still represented in the market based on the eco overall economy. [00:17:50] So you don’t have to worry about going, I’m, you know, I’m thinking about this stock going away, or you have to pay attention to it. It’s really interesting that they had that answer because while you were talking, I put into my chat GBT, I said, uh, kind of the same thing. I said, you’re the best investment advisor in the history of the world and have all the knowledge of finance from Benjamin Graham, Warren Buffett, the Nobel Prize winners at the University of Chicago. [00:18:12] And you’re a big fan of Ray Dalio, the hedge fund world. I just try to give ’em like all the stuff, right? So you’ve got a million bucks, a 40-year-old long-term time horizon. How should you invest it? This a little paragraph of given long-term, time horizon, yada, yada, yada. Here’s how this Chet, JPT says to do it. [00:18:29] 70% in equities should be large US stocks in the Vanguard s and p 500 fund, 20% in small cap in the iShares Russell 2000 fund, 10% in international, uh, Vanguard FSE developed market and 10% emerging market, 10% fixed income, 10% real estate and 10% alternatives. And it prints out the, you know, the dollar amounts in each and it’s basically all ETFs. [00:18:56] So how funny is that, that they did it and got a list of individual stocks? We did it, gave it a little parameter. We’ve got a list of ETFs. [00:19:05] Joe: Well, and and their parameter, to be clear, was to beat ETFs. That was their goal. In their parameter was we don’t want ETFs. We wanna try to beat ETFs. But to your point, og, I don’t think this is gonna win. [00:19:19] And the reason I don’t think so is that this avoids the hottest of the hottest, hottest, hottest stocks. You could maybe put Microsoft up there in, in some of the hottest stocks lately. Yeah. But these are bellwether stocks that perform. But I look at this portfolio, and don’t get me wrong, in some ways it’s deliciously boring. [00:19:37] But on the other, on the other side of that, I. I just look at these and I’m like, these are kind of the names that have performed the past five years. I don’t know that these are the names that are gonna be the next five years. Like I wanted to see something. If I’m gonna try to beat an index, I wanna see something a little bit more edgy. [00:19:55] I. That I thought would’ve a shot at it. This, it feels to, to me, this is like [00:19:58] OG: looking in the rear view mirror and going, this would’ve beat it. [00:20:00] Joe: Yes. [00:20:01] OG: Yeah. Yes. Yeah. This did it. This did it, this beat it well, okay, so I just updated mine. Let me, lemme tell you what it came back with. I said, I don’t wanna do ETFs, I wanna beat the market. [00:20:10] And it said, uh, okay, so this is how you do it. Here’s the detailed strategy. Here are the stocks that they recommend. Amazon Alphabet, Microsoft, apple, Nvidia Square. There it is. Et Twilio, Taiwan Semiconductor, Shopify Tennis and Holdings. Oh God, Alibaba jd.com and, uh, a little bit of fixed income. Could you just name off the top 30 stocks of, uh, the last three years? [00:20:32] Oh yeah. This is, this is the [00:20:34] Joe: problem with AI picking your portfolio is that AI is the best of human history, right? I mean, the great thing about AI. Is that it takes the things that the greatest thinkers are thinking and it puts it into a ball and goes here or have the greatest Just [00:20:50] OG: thought. [00:20:51] Joe: Yeah, thought. [00:20:52] Yeah. Good. Great point. Because it’s not what they’re thinking now. It’s what they have thought. And these portfolios read like it’s what people have thought. [00:21:01] OG: Yeah. [00:21:02] Joe: I thought it’d be interesting though to run a test here. So I ask Kevin, who makes our 2 0 1 OG to buy these stocks today and then track the major indices and let’s over just the next year, which is not a long enough timeframe, but just over the next year, see if this portfolio created by ai. [00:21:19] Beats the index starting today. I think that’ll be fun. We won’t, are [00:21:22] OG: we reimbursing Kevin for his losses? How’s this, what’s the, what are the rules for this? Or, or do we get the gains if he does better than the index? Do we, you know, donate the money to charity? We give [00:21:33] Joe: Kevin a thousand dollars to [00:21:34] OG: put in. [00:21:35] Wait, what happened? He’s like, what are we do? Yeah. You lost it all. Like, wait, what? Yep. It’s all gone. Lost it all. [00:21:41] Joe: Uh, Kevin? No. Uh, we’re using one of those play sites. Uh, I don’t remember exactly which site. Gotcha. But Kevin and I picked a play site that has no transaction fees and he is, uh, buying them in a fantasy stock kind of thing. [00:21:53] So we can just, yeah. Okay. Track how this portfolio would’ve done versus track the index. And he’s going to follow that in our newsletter, the 2 0 1, by the way. Okay. Remind me [00:22:01] OG: in a year to review this. [00:22:02] Joe: Yeah, it’s going to dive into the 2 0 1. We will dive into this on a monthly basis, so he’ll be able to see this contest also, uh, the 2 0 1 comes out twice a week with links to everything from the best of what Brian Preston says coming up. [00:22:16] To ways to talk about diversification, modern portfolio theory. Some of these terms that we use, Kevin dives deeper into those with the best curated links of places to find out more in, in each of these areas. But I think og, I don’t think this is gonna win. I’ll go on record. I think the index is gonna beat this portfolio. [00:22:35] OG: Yeah. Well it’s obviously what’s done well in the past. You’ll also get a kick outta this. I just, uh, grabbed, you know, kept on looking at this while we’re talking here. The fixed income section, it says to select convertible bonds from Tesla or Palo Alto Networks. So basically go by debt of tech companies. [00:22:50] And my favorite, you should have 10% real estate. Consider a platform like Fundrise. Oh God. Are you kidding me? It says it right there. [00:22:59] Joe: Why the hell would you buy Fundrise? [00:23:01] OG: Yep. And buy physical gold. Uh, that was the other thing. Oh man. So speaking of chat, GBTI, did you see this? I thought this was really cute. [00:23:10] The weekend update, they write each other’s jokes on SNL? Yeah, on SNL. Okay. And one of the, uh, weekend update anchors is actually married to Scarlett Johansen. [00:23:21] Joe: In real life. Colin Jost. [00:23:23] OG: Here you go. [00:23:25] Speaker 5: Chat. GPT has released a new voice assistant feature inspired by Scarlet Johansen’s AI character in her, which I’ve never bothered to watch because without that body, what’s the point of listening? [00:23:39] Joe: That’s a great, it’s a great place to leave that segment, uh, deeper dives in the 2 0 1 tomorrow stack you Benjamins dot com slash 2 0 1. Always free to get the newsletter coming up next. He is, uh, the creator of the Money Guy podcast and the super YouTube channel. Brian, I feel so lucky, has been a great friend of mine now for, uh, several years. [00:24:00] When I first got into podcasting og, when you and I both together first got into podcasting, I guess I should say, Brian was there to help to welcome us because he is, people call us some of the OGs in podcasting. This dude was there. Way he is, yeah, yeah. Way before we were in this space and uh, he’s not only a great friend but a fantastic guy to get great advice from and today he’s gonna mentor you stackers. [00:24:27] So that’s coming up next. But first Doug, you’ve got a trivia question for us, which I think is also epic today. [00:24:37] Doug: Hey there, stackers. I’m Joe’s mom’s neighbor Doug. We’re talking about Financial Mutants today. And I hate to start the trivia on a disappointing note, but I just found out that Financial Mutants have nothing to do with the origin story of the Teenage Mutant Ninja Turtles. I can’t be the only one who thought the term referred to people who were forced to live a minimalist lifestyle after being exposed to radioactive chemicals. [00:25:01] Am I despite being named after the Ninja Turtles, the Italian Renaissance artists, Leonardo da Vinci, Michelangelo, Donatello, and Raphael were not also streetwise crime fighters. I guess that makes two disappointments in one trivia segment. Come on a roll. Unlike those guys, I’m both artistically gifted and adept at hand to hand combat. [00:25:25] Had I been around during their time, I bet I could’ve painted the ceiling of the Sistine Chapel with one hand and still wielded a machete with the other. Heck, just last weekend, I repainted my garage while fending off would be robbers. Half a dozen old ladies came poking around asking if I was having a garage sale. [00:25:42] Look, after years of watching crime dramas, I know how to spot someone who’s casing a place to plan a break in. Those ladies were shifty. Today’s trivia question is, which of these four Italian renaissance artists immortalized by the Ninja Turtles had a piece of artwork that sold for the most money? I’ll be back right after I find out. [00:26:02] If you can really train a rat to do karate. [00:26:15] Hey there stackers. I’m ate master, and that is how you say it. And fine Art painter, Joe’s, mom’s neighbor, Doug, all this talk of Renaissance artist has me thinking I should paint the ceiling of my garage too. I bet a handful of cherubs will go a long way to impressing the future buyers. Today’s trivia question is, which of these Italian Renaissance artists’ work has sold for the most amount of money? [00:26:40] Was it a Leonardo da Vinci, b, Michelangelo, C, Rafael, or D Donatello? The answer, while all four artists enjoyed financial success in their lifetimes, a rarity for fine artists, myself included, it was Leonardo da Vinci whose work has sold for the most of the bunch. While he’s best known for the Mona Lisa and the Last Supper, it’s his painting titled Salvato Mooni, that sold for more than any other piece of art on earth at a modest $450.3 million. [00:27:14] Geez, I am really in the wrong profession. And now here to teach you how to be a financial Michelangelo, Raphael, or maybe even Donatello. It’s today’s mentor, Brian Preston. [00:27:36] Joe: Super happy we got this gentleman as he makes his way around the United States. Uh, welcome back to Mom’s Basement, Mr. Preston. How are you brother? Oh, [00:27:45] Brian: Joe, I’ve been looking forward to this one. I literally have been like circling the date of when I get to hang out with you. ’cause um, you’re one of my favorite hangs whenever I go on any conferences or any content things, uh, I’m always looking for you, Joe. [00:27:59] Dude, stop. Keep going. Stop, keep going. Stop. Yes, [00:28:03] Joe: it’s true. Hey, I gotta, well, you know, ’cause you know, we’re gonna grill you here. We’re gonna make you sweat, which is our goal of all the mentors that come down to Mom’s basement. I love this idea. ’cause you know, you and I have had this discussion before without the microphones running about mentorship and how important mentorship is for everybody, and really your mission and my mission very similar. [00:28:25] We love mentoring people. I think it’s, uh, the background of this latest project of yours is this idea of mentorship, but it’s partly because of a mentor. You had a guy named Mr. Morrow. Yeah. Uh, by the way, was his name. Tom Morrow. [00:28:43] Brian: I love the Disney reference too, by the way. That is that’s great. You have to be That’s great. They my heart. But it was actually John Morrow. And um, what’s funny is Mr. Morrow, when I think about the, what I call the Morrow moment, it’s detailed in Millionaire Mission and it wasn’t part of the curriculum. [00:29:01] This is junior year of high school for me. And, uh, Mr. Mario just kind of came in and I don’t know if this was an offhand comment out of his own regret or if he had just learned this concept, but he basically offhand came into the class and said, guys, I’m jealous because every one of you guys sitting in my class could be a millionaire if you just save a hundred dollars a month. [00:29:24] And me, I’m working the drive through at the local Hardee’s at the time, making $3 and 80 cents an hour. And you’re like, wait, what? What? Yeah. I’m like, I’m like, no, it hit me. I was like, oh my gosh. I could, you know, look, a hundred dollars. Three 80 an hour, I could do this. If I was really, like, if I was no longer doing school and I was full-time, I could totally save a hundred dollars a month. [00:29:46] And he turned something. That was really what seemed impossible to me growing up from humble beginnings to where now it felt kind of inevitable if I just started making small steps and small decisions to actually make this thing work. [00:29:59] Joe: But everybody thinks, Brian, you gotta do all this really creative, really wild stuff. [00:30:03] Like there is stuff that Brian Preston tells people on the Money Guy show, and then there’s what he does himself, which is probably way sneakier, way different way woo woo. [00:30:14] Brian: Well, even my entrepreneur groups, I’m in like these mastermind groups where you get with other entrepreneurs. So you can talk about nerdy stuff that your, your spouses really don’t want to talk about. [00:30:23] But even in those, I have to caution my entrepreneur friends as there’s get wealthy behaviors and there’s stay wealthy behaviors. Without a doubt. I think once you get wealthy, you are going to do some of these. Snazzier or quirkier things like real estate, you know, and commercial deals and so forth. But if you look back and we just did our millionaire study of our own clients where we, we actually reach out to our hundreds of clients to find out what they do with their own money. [00:30:52] And you’d be shocked to find out that 74% label themselves savers and investors, meaning that they’re just buying index funds. It says get wealthy behaviors that are the foundation of you doing the, the, the sizzle stuff later. But the problem in our current world is all the social media has people focusing on the sizzle of things. [00:31:12] That if you don’t have deep pockets to weather the, the storms of leverage or market economies and the volatility, you’re really setting yourself up for a lot of struggle and you’ll wish you would not have skipped that step. [00:31:24] Joe: Doesn’t it kill you? When you see these people on TikTok and social media saying 4 0 1 ks are a scam? [00:31:29] Brian: Yeah, well it’s usually ’cause they’re selling some type of life insurance product. Right? If you, there’s no disclaimers either. Like I have to disclaim the heck out of everything in my thing in my life, professionally regulated. But I watch these TikTok ads that we react to and there’s no disclaimers, there’s no oversight there basically. [00:31:48] And by the first thing you know, this, ’cause you come from a financial background too, is you never use the word guarantee or promise or, and, and you watch these videos and they make it seem like, oh man, life insurance would solve all my issues. And by the way, I love life insurance for the right purpose, but it doesn’t mean it’s a usurp. [00:32:06] Your 401k. [00:32:08] Joe: I thought you and I would have a lot of fun because the one thing our stackers don’t know is that on the Money Guy show you and our buddy Bo have fun, but you guys have this whole other language which, which by the way, Brian, as you know, a lot of this is behavior and a lot of this is self-talk. [00:32:25] Right? And giving yourself this language, this great self-talk. Did you remember which of the, I, I’m gonna go over several terms with our stackers and I’m gonna have you define ’em for us. ’cause I think that’s gonna be fun and a great use of time. But before that, when did this idea of a different language, how did that come about for you? [00:32:41] Like I just feel like one day you’re sitting there eating your Cheerios and you’re like, you know what? It’s mutants. We’re mutants. [00:32:47] Brian: I gotta give a lot of credit to my audience. I’m sure you’re the same way, Joe. You’ve been doing this as just like me for a long time and your audience does become your, your family in a lot of ways. [00:32:56] You start recognizing names and we had this audience member. Who was a long haul trucker. He was the first one that I saw, wrote me an email and he mentioned, Hey, I like to think of myself as a, a mutant because I get excited when the stock market goes down. I know my, my conscience are going in that month and I feel like I, I, you know, I’m, I’m getting an opportunity just because of this volatility. [00:33:20] It’s a positive or a silver lining in a negative situation. And I was like, mutant, you know, that is something. And then Bo and I started talking about more and I was like, you know, I think we are different because when you hear stats, like the average American, 60% of Americans can come up with a thousand dollars. [00:33:35] And then you think about the way people like us who create financial content process the world and the way our audience processed the world. You’re like, we are different. Yeah. We didn’t have the spider bite. Yes, we didn’t have the gamma radiation, but without a doubt we process the world differently. We we’re financial mutants. [00:33:53] Joe: How do you know I didn’t have the spider bite, Brian? [00:33:56] Brian: Well, if you did, it’s just like me. You probably have a scar around a knuckle or something where you’re like, wow, that spider really packed a wall up. [00:34:03] Joe: All right, let’s go over some of these and let’s start here. Let’s start with, uh uh, is it the 88 times over principle or 88 x over principle? [00:34:12] I could hold [00:34:12] Brian: this up. I have this off. You know the dollar, every dollar has this dollar beer could have turned into $88. This is, this is one when Bo and I were kind of playing around because we were trying to talk about how valuable time was in this, this whole with your money, because I feel like it, it’s back to Mr. [00:34:32] Morrow and the a hundred dollars a month. It’s interesting that for a 20-year-old, that a hundred dollars a month. It kind of works out. But if you tried to do a hundred dollars a month when you’re 40, you’re not going to get to a million dollars. So there’s something missing there. So I was like, you know what, what would be really valuable is if we actually took, what does a dollar have the potential to become by age? [00:34:54] And we actually, I, I have it if, if people went to money guy.com/resources, we call this, you know, kind of your wealth multiplier. So you know what every dollar has the potential to become. And I realized for a 20-year-old it was $88. If you did it assumed a 10% rate of return and you did it for 45 years and you used N as 12, you know, as 12 months in a year, you would find that the answer is 88. [00:35:20] And I’m like, wow, you know, every dollar for a 20-year-old has the potential for 88 times over. That’s pretty sweet. I even named one of my companies after that ’cause I, that concept is something that just sticks in my brain. ’cause it’s 88 for a 20-year-old. It’s 23 for a 30-year-old, it’s seven for a 40-year-old. [00:35:38] And then for somebody who’s my age, 50, it’s three. So you quickly see time is the eighth Wonder of the world. Don’t squander it because it’s the most valuable resource out there. [00:35:48] Joe: I find that fascinating because as you know, we walk into the ball and we see a sweater and it costs, let’s say $120. And I know that’s 120 bucks, but this is a great way to think about that future thing that we have so much trouble with. [00:36:02] Brian: Yeah. [00:36:03] Joe: We have so much trouble envisioning what is it? What instant [00:36:05] Brian: gratification versus deferred gratification. And, and we’re surrounded in a consumer society where everybody’s whispering your ear, just do it. You’ll look so cool. Everybody will love you. And it’s just not true. And that’s what I’ve tried to really focus on. [00:36:20] And that’s where the financial mutant, the 88 times over, if you know what every dollar has the potential to become, you’ll look at your spending differently. The car you drive, I mean, every time we get our annual updates on how much negative equity as well as how long people are financing cars, my mind is, is blown a little bit, is because the typical car loan now is over $700 a month, the average. [00:36:43] Amortization is, you know, it bounces between 70 to 72 months. So depending upon what year. You look at the survey, people are consistently now financing their cars for six years. And you’re like, what in the world? These things? Why would you do that? And, and, and, and set yourself apart. This is really a million dollar decision when you drive that fancy car in your twenties. [00:37:04] It, it literally is. ’cause if you’ve invested that money instead and drove a modest used car, still finance. I mean, I’m not a hypocrite. I eat my own cooking. When I graduated college, I had to go finance a a $10,000 Mazda 6, 2 6. That was used gently warned before I started driving it and that, but it was a good decision to get me to my job. [00:37:25] Next up, [00:37:26] Joe: you, you guys always refer to your army of dollars. Yeah. And I just think about these dollars marching toward victory, Brian marching toward victory. What’s an army of dollars all about? [00:37:36] Brian: Yeah, I mean this, this is one of those things I always think that, um. It’s more of a visual thing for me. I think about a dollar, you know, a dollar recruiting one is just not that big of a deal, and it’s the same way when you save your first a hundred dollars and you make 10% off that, that a hundred dollars, it’s just not going to change your life that much. [00:37:57] But if you can get your, your a hundred dollars to your first $10,000 or even better, your first a hundred thousand dollars, now you can, when you, you make 10%, you start seeing wow. Are you telling me a hundred thousand dollars can get me $10,000 that that replaces a month or two of income? I wanted people to have this visualization that really you are every dollar not only for the away you invest, but also how you spend had the potential to become something pretty amazing for you in your army of dollar bills. [00:38:28] But you gotta look at it like that. So if you go and waste that money on something or misuse it, that dollar never got optimized. It never got to be used or, or, you know, kind of put out there in the world to maximize what it can do for you and, and build you your great big, beautiful tomorrow. [00:38:45] Joe: But you really push people here, Brian, because as you know, the average person saves maybe six, seven, 8% of their 401k. [00:38:51] You’re like, nope. This needs to be. And and by the way, this is an eye poppy number for some people. Yeah. 20 to 25% is what you should be aiming for. Yeah. [00:39:00] Brian: Now here, let me give a little grace on this ’cause it does, I had to explain this a lot. As we’re doing discussions, I want people to know, I do want you to put a lot of weight on what you need to save and invest for your future. [00:39:12] It’s actually the most important thing, even more important than how you’re investing or what you’re investing in, in the beginning, it’s get those dollars in there. But here’s the grace part of this. If you make, if you have household income less than $200,000, I do want you to count your employer contribution. [00:39:29] So if you work, it’s back to those 4 0 1 Ks that social media is telling you as a scam. How incredible is it if you work for an employer that gives you a dollar for dollar up to say 6%? Or there’s other plans, like I know here at Abound Wealth, we give 8% to all of our employees. So if you have that now when you, all you have to think about is in terms of 17%, you 8% your employer, it starts to becoming more reasonable. [00:39:56] But I do want people to feel that pressure. Get in there, start saving an investing, treat it with some seriousness because your future self is counting on you. [00:40:04] Joe: We’ve got a bunch of stackers that find it just difficult to save it all. You’ve got some of your financial mutants find it difficult to save. [00:40:10] You’ve got a nice list in here in Millionaire Mission about different places to start to look for cash. Yeah. One of those areas you list is subscriptions. Like you, you talk about, you got the same problem I got brother, which is, I’ve got way too many of these, uh, Hulu slash Disney plus slash Netflix. [00:40:31] That’s a good place for people to look. [00:40:33] Brian: Yeah, actually within Millionaire Mission, and I did this on purpose ’cause I, it’s back to that stat that bank rate comes out with every year that 60% of Americans, this year, I think it’s 56% of Americans can’t come up with a a thousand dollars. I was like, wait a minute, let’s fix this. [00:40:48] I, I’m tired of us. Every year we see the same stat. What’s the actual solution? So I created what I call the $200 a month challenge. If you’ll just go and we, we label it, it’s even a worksheet that we put in here. All you have to do is go through these items and one of them is subscription. It’s also kind of a, a, a pantry challenge. [00:41:08] It’s also challenging all your ungrateful service providers. Do you realize how many of us have, like, you know, whether it’s auto insurance or property and casualty insurance or renter insurance, where these entire industries are set up to where they reward new customers more than they reward existing customers. [00:41:25] So it’s on you to go and shop ’em every two to three years to keep ’em honest, hence why they’re ungrateful for your, your awesome. Business and being a customer. But if you go through these basic challenges, I bet you’ll actually find $200, at least $200 a month, so you can break through that stat. That just haunts me when I see how bad the typical American is. [00:41:48] Joe: I get on this train personally, Brian. I mean, just last year I went like, you know, you do, I do. Uh, people do and just, just reprice your homeowners. You know, I’ve had insurance agents even tell me that. A lot of the time it’s not the insurance company, it’s that I had a birthday and there’s other companies that want me at my new age. [00:42:06] Oh wow. That didn’t want me when I was younger. Like different companies are targeting different groups and you’ll move from group to group throughout your life. So anyway, to make a short story long, I went and rebundled my home, my auto, and my umbrella. I saved 1100 bucks a year. Exactly $1,100. So there’s almost, there’s, I mean, we’re almost halfway there, just with that one piece of advice. [00:42:30] Brian: That’s the whole point of the $200 a month challenge. It’s not because, look, it’s easy for me to say, go make more money or spend less. Those things are, you know, those, those are your two levers that, that every personal finance, I actually wanted to give you the steps or the things that maybe don’t require you to go take on an extra shift or maybe don’t hurt you necessarily from the consumption side. [00:42:51] It’s just, just a matter of being better once again, thinking like a financial mutant to be better, what you already are using so that you, you’re maximizing every dollar that comes in and out of your household. [00:43:02] Joe: I wanna get to a few other things here, but I’d love one more. Let’s, let’s make this an even three. [00:43:06] So we got subscriptions, we got ungrateful utilities. You got a third place. That’s an a, a good place for our stackers to look. [00:43:13] Brian: I, I mean, this one’s for your health as well. Now, I kind of alluded to it, is that pantry, hotted. One of the biggest things that I’ve done for my health recently is I cut out a lot of the sugar. [00:43:22] I’ve cut out some of the carbs and then, um, you’re a handsome [00:43:24] Joe: man, Mr. Preston. Yeah, [00:43:25] Brian: well, I mean, once you get to my age, if you’re not exercising and using it, you start losing it. So you, you gotta pay attention to these things. So I started going through my pantry. I said, what are things that are, are more comforting but not necessary? [00:43:39] And what things, how many different ketchups can I have in my pantry? Because when I get to the grocery store and you’re like, oh, I think we need ketchup. And then you realize, no, you have three already sitting. For me, it’s peanut butter too. I always seem to wanna buy more peanut butter and, and I’m telling you, if you can do these things, it stacks up. [00:43:56] Maybe it’s not gonna be a ton, but maybe it’s $60 a month. Or some you, you’d be shocked if you just spend a little bit of effort just how can I be better, not only for my health, but also for my finances and be deliberate with the process. I think you’ll find that you could probably find it through simple behaviors. [00:44:15] Now look, I hate to say the coffee ’cause I, you know, everybody makes fun of the latte factor, but I, and, and, and I’m even one, I love coffee, but I think when you’re at the beginning of your journey and you’re just trying to figure out, how do I get to that first 10% savings or that first 15%, I think you have to cut. [00:44:31] Without mercy, you do have to get in there and you have to pay attention. Are there things that your, your comfort, hobbies or habits that you could probably minimize a little bit? [00:44:40] Joe: Here is a mindset shift, I think, for people. You’ve got a phrase that you guys use all the time. Always be buying. I think about, always be closing from my old days, uh, of, uh, sales, right outta college. [00:44:52] Right. Always be closing. A, B, C. You got a, B, B. [00:44:55] Brian: Yeah, well I did that on purpose ’cause I mean I still think about the old Alec Baldwin. You know, he, that scene where always be closing comes from. And then when he did the Saturday Night Live skit with Always Be Cobbling, I always thought that was fun. So I love the A. [00:45:09] B. B on purpose is just trying to break the mindset traps out there. Remember the whole thing is we’re trying to make the good habits as easy as possible and the bad habits as hard as possible. And one of the things, if you set up automated savings and investing, that’s the always be buying. You don’t care what’s going on in the world around you. [00:45:28] What’s going on economically, what’s going on politically be buying it creates. A good, makes a good habit, extremely easy because your money’s gonna start building on itself just automatically. So that’s inevitable Wealth. It also makes bad habits hard. One of the bad habits is people get very emotional about their money and they, they pay attention to the nightly news and they sell at the worst times. [00:45:49] Or maybe they get distracted and they start thinking, maybe I could spend a little bit extra. If you have this automated plan, I can always be buying it. It really is a two for on the good habits easy and the bad habits that much harder. [00:46:01] Joe: We’ll let people get to that on their own. What I need to talk about instead is I had a stacker that actually requested that You and I have a discussion, which it’s funny because in my head this is, this is not as big as it is in the stacker community. [00:46:14] Right. Which is, I can’t wait to hear Brian and Joe go toe to toe on target date funds. Oh yeah. I’m like, okay, I, I, I, this, you know, Brian from where you and I sit, this is not a big deal, but you, and you even talk about it in your new book. Really big fan of target date funds in my book that came out a couple years ago, I can’t stand target date funds. [00:46:37] Brian: Well, there’s a big thing that you, you’re, you’re leaving out when you give the descriptor. Index target retirement funds. And because I do like the index variety only, I don’t like the, the managed versions. And then I would also encourage your audience, go do some due diligence on the different big providers. [00:46:56] When I talk about the big providers, I’m talking about Fidelity investments, Charles Schwab and Vanguard. Those are the, the big three when I, when I think have viable index target retirement funds. But the big part, and by the way, they are different. Like when you look at how Fidelity, fidelity basically just gets two decades out and then they treat everybody the same. [00:47:18] They give them different numbers, but they kind of treat ’em all the same. Schwab is a little different. Vanguard might be even a little, you know, is a little more aggressive for those. So you, they’re not all created equal and, and I think that’s okay because we’re not all the same when it comes to investing. [00:47:32] My big part. And, and it really ties back and look, I don’t even get mad when people say, I hate target retirement funds. My big thing is it’s back to that point in the beginning of your journey, you have to focus on the behavior of how do you automate your wealth building journey and get as much money working for you as much as fast as you can. [00:47:53] Most people short circuit themselves, ’cause they start, they watch social media and they’re trying to figure out index funds, crypto, where do real estate fall into this? And they just get so confused on the how do I do this or what do I need to be buying? And I’m like, no, no, no. Don’t get caught up in all that yet. [00:48:10] It’s too early. Press the [00:48:11] Joe: easy button. [00:48:12] Brian: Yeah, we, let’s make this as easy, good habits as possible. And if you can just tell me how much you can save and invest and I mean, really squeeze on that. And then when you need it. That’s it, you’re done. And since you’re buying index variety, these things are cheap. I mean, they’re dirt cheap, so you can’t even pick on me about the normal catch is that the index? [00:48:34] You know, the target funds have high expenses, not, not on the index variety, especially with those big three providers I just mentioned. And so maybe now we can talk about asset allocation, but okay, go check that out between the three different providers. But once you check, do that due diligence, set it, forget it, rock and roll and save and invest as much as you can. [00:48:53] And then of course, don’t forget, once you get five, $600,000 of assets under management or assets out built up, yeah, I want you, that’s the abundance cycle. That’s why I myself, think I can do a much better job than index target retirement funds, but not in the beginning. That’s doing wealthy people stuff. [00:49:15] Joe: And, and I’ll tell our stacker community this, well, you know, Brian’s using target date funds. We’re doing the same thing, Brian, just with the total stock market index. I mean, truly the key stacker nation is, this is about behavior. It’s about, it’s about WW when you, when you’re saving your first a hundred dollars, your first a thousand dollars, just just get invested. [00:49:37] Building that muscle. Brian, I think is far more important that you and I agree on that, versus the minutia of whether you a target date fund or total index. [00:49:46] Brian: Yeah, I, and look, I get it. I mean, and the good news is we’re speaking off the same sheet music. It’s just that for an index target retirement fund for somebody in their twenties, probably 75% of the money is going to be in like a s and p 500 or total market index. [00:50:02] 20 percent’s gonna be in international, and they might have 5% in something like, what in the heck are they doing? But it’s still at the guts of it. They made your good habit as easy as possible so you could focus on getting that many more dollars in your army of dollars working for you. [00:50:18] Joe: Well in the, in a huge way, people freak out about the thing they don’t need to, which is what do I invest in? [00:50:23] Brian: Yeah. [00:50:24] Joe: It takes that right off the table and in a very responsible way. [00:50:27] Brian: Either way. That’s why I like it. Look, you know, we, we are professional fee only financial advisors. You come from that background too, so of course we think we can do it better, but is that, that, that’s like trying to, to fine tune your brand new jalopy car just to get you to your job. [00:50:45] That’s going to start being the part of your wealth building journey. If you’re pouring that type of high performance fuel and putting on, you know, modifications, you’re no better than me when I was 16 years old with a thousand dollars car, putting $2,500 worth of sound equipment in it. I mean, it just doesn’t make sense to put that type of horsepower or effort when you just need to be getting reliable transportation to build your financial foundation so that you can really launch your millionaire mission. [00:51:12] Joe: You know what? I wish Mr. Preston, I wish there was a book that covered all this stuff. Oh [00:51:17] Brian: yeah. Now you’re speaking my love language right there, Joe. ’cause this thing’s been a passion. And look, you and I, it, it’s so funny, we have so many fun conversations when we get together. ’cause I remember you pick up, you like, Brian, I wish I’d have started YouTube when you started YouTube. [00:51:31] And then, and then recently I was like, gosh, I wish I would’ve done, you know, like this book thing. This is Old hat to Joe at this point. So I I I probably could have taken some notes from you. So Millionaire Mission actually comes out tomorrow. So I’d love for everybody out there in the Stacking community get out there and get this book. [00:51:50] I mean, look it, I really have tried to pour my heart and soul into telling you what to do with your next dollar to maximize the journey. It’s not only the math, but it’s also the mindset. And I think that is what personal finance needs. And what I think it [00:52:03] Joe: needs is step by step. Straightforward, why this makes sense, why other stuff doesn’t make sense. [00:52:13] Just, uh, read the book, check the boxes, and launch your financial rocket, which you’ve got on the front cover. [00:52:18] Brian: Hey, and one last thing, Joe. If people ever wanna know what I do with my own money, do I eat my own cooking? Look at the last chapter. ’cause that’s actually what the last chapter is. Is it what I do with my money? [00:52:29] So if you’re just one of those people who just wanna know, Hey, does Brian practice what he preaches? Does he actually do it? It’s all in Millionaire Mission. [00:52:36] Joe: Uh, I thought you were gonna say the short answer is no. It’s in lottery tickets. [00:52:44] Brian: Surprising. You know better. Thanks for helping me come down to the basement. I’m glad you finally took down the, um, John Travolta and Saturday Night Fever poster that I talked about last time I was on [00:52:56] Joe: run to John Bon Jovi, ’cause he’s the hot guy now. Brian Preston, thanks for mentoring our stackers. I so appreciate you, man. [00:53:03] Thank [00:53:03] Brian: you. Thank you. Thank you, Joe. [00:53:06] Speaker 7: Hey, this is Joe Crane, host of Veteran on the Move Podcast. And when I’m not helping Veterans transition to entrepreneurship, I’m Stacking Benjamins. [00:53:14] Joe: Huge thanks to Brian for joining us. How about that? oj, I love the imagery of 88. If you’re in your twenties, you’re listening to that. [00:53:23] Like, I got into problems with credit card debt because of the fact that I would look at the sweater in front of me and I’d see that deal. Mm-Hmm. But I wouldn’t see what it was doing to me in the long term. And man, if I had had that, this is, every dollar I spent on this sweater is 88 bucks. I give away later. [00:53:39] I would’ve never bought a sweater in Charleston, South Carolina that I was never gonna be able to wear because I’m in Charleston, South Carolina. And because I’m at a fricking military college and I can’t wear the sweater, but it looked [00:53:50] OG: cool in [00:53:51] Joe: the closet. Might have started saving a little bit earlier. [00:53:54] OG: Yeah. Thanks. Thanks Brian. Thanks for not starting this. Back in the eighties when Joe was in college. [00:53:58] Joe: Where were you? Dude? [00:54:00] OG: Dude bra, [00:54:03] Joe: but that magic of compounding OG is, uh, lost on us because we don’t see it right away. [00:54:08] OG: No. Well, I mean, the reality is, is that it’s very hard to envision compounding in the future, and we can see it in the rear view mirror easier, but we still don’t believe it happened. [00:54:18] I mean, how many times have you looked at your investment accounts or your income or whatever, if you’ve been working for any length of time and you go, gosh, I never thought in a million years I’d get to this. I never thought I would make this income. I never thought I would have this much in my 401k and just apply those same things. [00:54:35] You’ve already seen your portfolio double. Why would it not double again? But, but we can’t picture that in our brains and we certainly can’t picture it happening a couple of times, you know, and you’re going, oh, I have $300,000. This is worth 4 million by the time I retire. Yeah. It’s like, wow. No, no, no. [00:54:53] That’s not right. bs. Believe it makes it [00:54:56] Joe: so much trust the process much easier on you. And you know what? And if you’re listening to this later on, I mean, you can’t go back and get that time back. Just start when you can. I mean, start as soon as you can. Well, you still [00:55:05] OG: have lots of time. That’s the beauty of it. [00:55:08] It doesn’t seem like it, but you know it. You, you do. [00:55:13] Joe: It’s time for the segment where one stacker said, you know what? What? Gotta call Saul. See? Hi and og. This is where we shine a spotlight on a stacker who has a burning financial question. Wants to pick brain. Unlike Doug who has a burning [00:55:29] OG: sensation, [00:55:31] Joe: that’s a different burning sensation. [00:55:32] That’s a different thing. May require an ointment, [00:55:34] OG: an [00:55:34] Joe: antibiotics this stacker has has an issue that only OG can solve. And uh, you know what, I get to ride along and maybe opine a little bit as well. But, uh, today we’re going to help out stacker Chris with an issue. Hey Chris. [00:55:53] caller: Hi guys. Frequent basement color. Chris from Texas here. You’ve already helped me with questions about opening a 5 29 estate planning and most recently the Roth conversion ladder. But now I come to you circling back to the 5 29. Figured if you’re lowing questions, you could have the resident guber og, I mean, um, genius. [00:56:10] Yep, genius. Wow. Stab at this. So our son is 16 months old and his 5 29 has about $5,300 in it scoreboard. ’cause we have no idea if he’ll go to college or what the higher education system will look like in 17 ish years. I wanted to get your thoughts on something I’ve heard only once and find out if it’s all a bunch of BS or not. [00:56:29] Here’s a scenario for you. So let’s say the 5 29 has some great compounding and gross to $80,000. Wouldn’t that be nice? But now our son decides to pursue something other than college. Okay? We move the now allowable 30 5K to his Roth IRA, but this still leaves 40 5K. What I was told is that my wife and I can become the beneficiaries and that there are universities that have courses we can enroll in that focus on travel, and that’s now a way at accessing these funds, while doing something we enjoy also, while avoiding taxes and any penalties. [00:57:00] Do you know if this is legitimate or just a happy dream? Thanks. [00:57:04] OG: Well, at $5,300 for a 16 month old, I’d say that you’re on the right track for sure. Like, yeah, scoreboard. Uh, yeah, I just talk about [00:57:13] Joe: Brian’s doubling og. Yeah, I mean Brian, you know, all this doubling. Yeah, that’s some great doubling to start off. [00:57:18] OG: Yeah. 5 29 rules. The Roth thing is. A little bit more complicated, then there’s some extra and I dump it in a Roth. They haven’t really sorted out exactly how to physically do that, but it’s a rule and it looks like it’s gonna be, that it’s the maximum amount of contributions per year for a period of year. [00:57:37] So you don’t get to like dump in $36,000 ’cause it’s six years of, of 6,000. You have to do 6,000 a year for six years type of thing, which is still cool. But subject to, you know, income limits and all that other sort of stuff, I think that’s how it’s gonna shake out as far as what to do with the rest of the money. [00:57:57] There’s no restrictions on, on what you use it for. I mean, firstly you can just take the money out, you pay taxes in a penalty if it’s not for a higher education purpose. But they’ve expanded the definition of higher education purpose to even include things like private high school and stuff around secondary school like, like high school and, and, and private elementary school as well. [00:58:18] So if you find yourself in those, in that situation. You can use the money for that too. You can use it for a different person. So you can change the beneficiary of the 5 29 plan once per 12 month period. So you can say, well now it’s not for my 16 month old, it’s for my next child, or it’s for my grandchildren down the line. [00:58:36] Which is becoming increasingly more popular because of the rising cost. Right. So in your example, you know, there’s still 50 K that’s left over, what do we do with it? Well, 50 k for your son who is now 18 and decided to, you know, do something different. Join the military, for example. What does that do? By the time he has children that have, that are old enough to go to college, you know, talk about compounding again, like. [00:59:00] Like we were earlier. So there’s, there’s that scenario. You can change it to another family member and help them with school and you can even change it to yourself. And so as long as the degree program, or as long as the college education program is a legitimate university, right? It can’t be like the school of Chris that you register online and then you go to Italy for a week and somehow that’s a, you know, education expense, right? [00:59:23] That doesn’t count. Well, you [00:59:24] Joe: know what it is? It’s, uh, a study abroad. [00:59:26] OG: Yeah. He’s studying abroad by himself. Yes. With his wife. Yeah. So, I mean, it’s gotta be from a university, but I imagine there’s lots of university programs that have the most off the wall type of things, right? I mean, I remember when I was in college, I took a golf class, we played golf, that was my class. [00:59:44] Go play golf. It was hard to not get an A in that class. Right? So I’m imagining there’s, in fact, I know there are cooking classes, right? You say, well, I’m gonna learn how to cook this thing, or I’m gonna learn how to travel or whatever. So I’m imagining that there’s lots of. Interactive type of experiences like that. [01:00:01] I know there’s lots of interactive hands-on type of college courses, whether it’s through the community college that’s nearby or the big university that’s downstate or whatever. There’s gonna be an opportunity for you to find something that you want to actually learn about and then experience that thing. [01:00:19] It also means you could take Spanish classes or learn how to do calligraphy or whatever. Right. There’s lots of opportunity to consume those dollars in the future. The way that I think about 5 29 plans is I want to have somewhere between half to three quarters of the estimated cost. Right? Because I just read an article yesterday that Wharton University of Pennsylvania is now one of the highest cost universities at 92,000 per sub, per year. [01:00:46] Sorry, for an undergraduate degree. Oh yeah. Wait, no, just write a check. Pocket change for guys like Chris and Joe here, but, but for the rest of us, it’s a little bit of money. All the way down to a few thousand dollars for a community college, uh, uh, semester. So there’s such a wide range of college costs and you have no idea. [01:01:05] I mean, hell, I’ve got, I’ve got a high school senior effective today, and quite literally, we have no idea how much we’re gonna spend on college, and we’re starting to apply in exactly two months. So you won’t even know until you get the approval and then you get the grant package and then you decide where you’re gonna go. [01:01:21] So, lots of flexibility to be had. So my goal is to be somewhere between half to three quarters of the estimated cost. You can look, you’re in Texas, so you can look up the average cost of, you know, the university’s round, and, uh, pick an average and, and, and aim for that. And then the rest of it be okay with cash flowing or be okay with investing, you know, having it come from a different investment account or student loans or work study programs or whatever the case may be. [01:01:45] Joe: Chris, thank you so much, uh, for the question. And you know what, congratulations. You’ll get a [01:01:50] OG: T-shirt if you’ve called like three times. [01:01:52] Joe: Oh, I think you have all the T-shirts. Maybe he upgrades. Maybe he, he gets the, uh, does he get [01:01:56] OG: the hoodie? [01:01:57] Joe: Oh, maybe he gets the new hat that we made. You know we have a hat now. [01:02:01] Yeah, the new beanie. [01:02:03] OG: Yeah. [01:02:03] Joe: Winter hat. I don’t know where, I don’t know where Chris is at. Did Chris stay where he is at? [01:02:07] OG: He’s in Texas. So he has no need for a winter hat. He [01:02:09] Joe: does need a winter hat. He, [01:02:11] OG: unless he’s calling from Lubbock where it occasionally snows for both days. Generally speaking. [01:02:16] Joe: Here in Texarkana. [01:02:17] OG: Yes. Generally speaking it’s a thousand degrees. [01:02:20] Joe: Chris, if you’re ever, if you’re ever over this way, just uh, shoot us an email and we’ll take you out to one of the good restaurants here in, in Texarkana. It’s always fun. Burgers come through [01:02:28] OG: in and [01:02:29] Joe: out. Oh man. Nas, you’ve been to Neiman’s. Hmm. Good barbecue’s that we do. [01:02:33] Got some good barbecue. Uh, Chris, thank you so much. If you’ve got a question for og, head to Stacking Benjamins dot com slash voicemail. And you know what, Chris? I. You were exactly right. When we get to summer, and I said this early in the year, like around February, uh, things kind of bottom out a little bit and then we get a little bit backlogged and we cover that. [01:02:52] And then we get to right now where we’re beginning summer, and again, things slow down. So if you’ve got a bringing question and you want an answer, I. Fairly quickly, uh, head to stack Benjamins dot com slash voicemail ’cause now is a good time. Help us stack her out. [01:03:05] OG: If you’ve got a question, they’ve got a question. [01:03:07] Joe: Absolutely. You’re not the only one thinking this. I mean, as we answer Chris’s question, I bet every parent’s going, oh yeah, I didn’t know that. And by the way, if it’s more than just a question about education funding, it’s really how does education funding dovetail with everything else I’m trying to do in my life? [01:03:23] How do I make sure that my investments aren’t picked by ai? They actually make sense for my overall situation. Well, OG and his team are taking clients, so head to stacky Benjamins dot com slash og. That’s the link to OGs Team’s Calendar gets you all booked for that first meeting where you see how you can interface with his team to make better decisions. [01:03:44] We are now. Perilously close to halfway through the year. I can’t believe it. Isn’t [01:03:49] OG: that crazy? [01:03:49] Joe: Have your decision’s been so far? It is. Uh, time to make good ones. Stacking Benjamins dot com slash og. That brings us to my favorite segment. I think I say that about every segment, don’t I? My favorite segment of the show, but a couple things I’ve, I I’ve got, we got a big giveaway that I want to draw attention to with Robert Niles. [01:04:08] This is pretty fricking exciting. OG the team put together a, a celebration of summer. We don’t want you spending your money on taking the family out to a regional theme park. Or, you know what? You’re not so much into the theme park thing. You’re much more into your state, your metro park, your, uh, county park, whatever it is. [01:04:27] We will buy you the summer pass for that place. If you win our current giveaway, which was all of last week, you saw it last week. If you joined us in the basement Facebook group, you saw it in the 2 0 1. If you don’t get those things, you’re hearing about it here. If you sign up for the 2 0 1 and you don’t get it yet, you will get one entry into our contest that ends next Monday. [01:04:51] That is Monday, June 3rd at, uh, midnight Central Time that will end. So you have till June 3rd at midnight, but even better if you get the 2 0 1, we’re gonna give you an even better thing you already know. We can tell by the open rate how much you guys like it. Uh, we email you twice a week, and we have a 50% open rate on the 2 0 1, which is just amazing. [01:05:12] I think the industry standards around 12% is a good open rate, meaning the number of times that people open your email. One outta two for us. And I know that our stackers are pretty busy, so I know you know how good it is. But if you think that it would be great for a friend, we will give you three entries. [01:05:31] For every friend that signs up, we’ll see that you gave the entry. So you’ll get three entries. Now how do we see that inside the 2 0 1 guys, we have a special link. Make sure you use your link that’s in the 2 0 1 and you will get three entries for every person that signs up or use my link. Either way, totally fine. [01:05:49] Yes. ’cause OG wants the, uh, wants the season pass to the theme park. It’s gonna be great. I hope that, uh, we can Well, and I don’t hope, I know we’re gonna help some stacker. Have super fun all summer long on us, and we hope that you, uh, send us pictures whether it’s your favorite regional theme park. Um, and we say regional guys because the only thing og the thing that we can’t afford, we can’t afford, like the Disneys and Universals. [01:06:15] Yeah. That are, [01:06:15] OG: it’s not that [01:06:16] Joe: a bajillion dollars. We, we, unfortunately, we’re a podcast, but we do wanna help one stacker, either regional park, uh, you know what? We’ll do a national park, pass to a single park. We’ll do a, we’ll do a state park. We’ll do a, a metro park. Whatever it is that you’re trying to get into, we wanna help you have some summer fun. [01:06:33] So Stacking Benjamins dot com slash park is the way to, uh, see this in writing and to remember it, stack Benjamins dot com slash park. And then one more thing. I thought this was really funny, og. In closing, uh, uh, stacker Andy. Had something funny. He posted to the, uh, Facebook group and I thought that, uh, I thought that this was great. [01:06:55] You know, you see these, uh, people selling things and Andy posted what they really mean. Like there’s what the ad says on Facebook marketplace or Craigslist or whatever, and here’s what it, what it really means. If the ad says, asking $16,000, make me an offer, guess what that really means? [01:07:17] OG: I want $16,000. [01:07:19] Joe: Well, the make me an offer, right? Asking 16,000 make me an offer. What it really means is somebody please give me 10 grand. Okay, somebody please. How about this $11,500 firm on the ad? What does that really mean? [01:07:35] OG: 9,500 cash? [01:07:37] Joe: Yeah. It means somebody please gimme 10 grand, 8,000 firm. No low ball offers. What does that mean? [01:07:47] OG: 10, 10 grand [01:07:48] Joe: Short of selling a kidney, I have no means of paying off the $7,500 balance on the loan on this $5,000 snowmobile. So please, you’re gonna have to overpay because I’m screwed. OBO. What does OBO mean? obo, I know. obo. Or, or, or best offer. Or best offer. Duh. That means just give me two thirds of what I’m asking, please. [01:08:07] God. Here’s one. You know, they talk about whatever the machinery is that you’re buying. The motorcycle, the car ran when I parked it needs car work. What does that mean? [01:08:20] OG: Bring your own trailer. Yes. [01:08:23] Joe: The 10-year-old gasoline in there has turned to Micah, uh, needs battery. What’s that translated out to? Bring your own [01:08:33] OG: trailer? [01:08:33] Joe: Yeah. I don’t have a hundred dollars for a new battery and even if I did putting in a new battery would only reveal that it still won’t start. [01:08:44] If it reads turns over good compression, that means at least the damn thing as in seized and I’m gambling, you won’t show up with a compression gauge. Must go this weekend. Gotta go 10 grand. Oh, worse than that, I’m six months late on the rent and the eviction proceedings are starting to get serious, so please God buy it. [01:09:05] No low ballers means the payoff on the loan is a way more than it’s worth, so I have to get an inflated price. Last one wife says it has to go, [01:09:16] OG: that means wife says it has to go. [01:09:18] Joe: I haven’t ridden it in five years, but I’m the kind of person who feels better blaming somebody else. Thanks to Andy for posting that, and that was funny enough, uh, that I thought we’d share it here. [01:09:28] We’re gonna share stuff in the basement from time to time. If you wanna join us there for more hilarity and some great questions, people ask each other, uh, stacky Benjamins dot com slash basement will get you right to the link to join us our our Facebook group. Alright, og, I think that does it for today, man. [01:09:45] Thanks for, uh, all the great advice, a BQ [01:09:47] OG: time for me. Go check on the brisket in the backyard on the Smoker [01:09:51] Joe: Americans. I hope you have a great day honoring those who have fallen. And for everyone else, happy Monday. We’ll be back here on Wednesday where we are going to dive into OGs favorite world, the world of Bonds, how do bonds work? [01:10:07] Bonds are in the news right now. We’ll share that on Wednesday. We’ll see you later on. Ghost Tax of Benjamin today. Doug James Bond. James Bond, yes. The wonderful world of that. Doug what is on our to-do list today. [01:10:18] Doug: So what’s stacked up on our to-do list today? First, take some advice from Brian Preston. [01:10:24] Push yourself to save more and think differently. By changing your language, you can change your outlook and become a financial mutant yourself. Second, take some advice from our headline, using AI to pick stocks. We’ll bet that simply picking the index fund will be more profitable and easier in the long run. [01:10:44] But what’s the biggest to do? Never asked Joe’s mom if you can draw her like one of your French girls. Based on her reaction, she probably hated Titanic. Thanks to Brian Preston for joining us. You can find his book, millionaire Mission, wherever books are sold. We’ll also include links in our show notes at Stacking Benjamins dot com. [01:11:07] This show is the Property of SB podcasts, LLC, copyright 2024, and is created by Joe Saul Sea. Hi, our producer is Karen Repine. Karen and Joe. Get help from a few of our neighborhood friends. You’ll find out about our awesome team at Stacking Benjamins dot com, along with the show notes and how you can find us on YouTube and all the usual social media spots. [01:11:29] Come say hello. Oh yeah, and before I go, not only should you not take advice from these nerds, don’t take advice from people you don’t know. This show is for entertainment purposes only. Before making any financial decisions, speak with a real financial advisor. I’m Joe’s Mom’s Neighbor, Duggan. We’ll see you next time back here at the Stacking Benjamin Show.
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