Finance Friday: Paid-Off House Peace of Mind vs. Investing Opportunity

Mindy:
Welcome to the BiggerPockets Money Podcast show number 224, Finance Friday edition, where we talk to Laurin about starting late, paying off a mortgage early and allocating your investment dollars.

Laurin:
So, now I’m investing and saving as aggressively as I can, but I also really want to live and enjoy our life because I work so hard. So, we’re sort of in more of a slow fire approach to living. And that’s really what we’re focused on. How do we maximize the money that we’re bringing in, make smart investing and saving decisions right now while being able to enjoy the things we want to do with our family and our kids.

Mindy:
Hello, hello, hello. My name is Mindy Jensen and with me, as always, is my great smelling co-host Scott Trench.

Scott:
You’ve got an olfactory of these introed puns, Mindy. Thank you. Introductory remarks.

Mindy:
Okay. Scott and I are here to make financial independence less scary, less just for somebody else. To introduce you to every money story because we truly believe that financial freedom is attainable for everyone, no matter when or where you’re starting.

Scott:
That’s right. Whether you want to retire early and travel the world, go onto make big time investments in assets like real estate, start your own business, or back into a paid-off home and a comfortable retirement five to seven years from now, we’ll help you reach your financial goals and get money out of the way so you can launch yourself towards those dreams.

Mindy:
Scott, I am super excited to talk to Laurin today because we ended up giving her some advice that we don’t typically give people and a bit of confusion on my part at one point regarding tax brackets and reducing your taxable income and all of that, which is then later explained by Scott in a much more cohesive manner. So listen to my part of this in the beginning with a grain of salt, but yeah, I love her-

Scott:
Yeah. I don’t think you have any confusion with this. I just think that it’s a complete opposite of the advice that we would give to Kirsten, for example, or Kirsten from a few episodes ago when she’s getting started and needs to be contributing to a Roth, or foregoing those retirement accounts, just because of the different circumstances that Laurin is in today. And so it’s this art of how to manage your money. There’s no right answer. There’s only best guesses based on where you want to go and what your circumstances are today and all that kind of stuff. So it’s just fun and different every time with this kind of stuff.

Mindy:
Yeah, definitely the advice that we give Laurin is based on the fact that she makes a lot of money, is in a high tax bracket, lives in a high cost of living area, and has specific goals, and is not looking to retire when she’s 30. I think if she had all of this combination, but was a different age, then we would have slightly different advice for her. But by the time she has reached her financial independence goal, she doesn’t have a whole lot of time left before she can start taking withdrawals from her 401(k) plans without incurring a lot of penalties. Without incurring any penalties, right, Scott? 59 and a half, you don’t have to pay any penalties. So, episodes like this are so much fun because it really makes me think outside of the norm, “Spend less than you earn and start a business and,” blah, blah, blah. Well, sometimes there’s different levers to pull. So, this is a lot of fun.
Before we bring in Laurin, I have to tell you that the contents of this podcast are informational in nature and are not legal or tax advice and neither Scott, nor I, nor BiggerPockets is engaged in the provision of legal, tax, or any other advice. You should seek your own advice from professional advisors, including lawyers and accountants regarding the legal, tax, and financial implications of any financial decision you contemplate.
Laurin and her husband make an excellent salary, but they live in a high cost of living area and also got a bit of a late start on their journey to financial independence. They want to be financially independent in the next 12 to 15 years and are looking for both a double-check on their plan and ways to further optimize it. Laurin, welcome to the BiggerPockets Money Podcast. I’m super excited to jump into your situation.

Laurin:
I’m super excited to be here. Thanks for having me.

Mindy:
First of all, you may have gotten a late start in life, but you guys, I think you’re doing pretty good. I have a sneak peek at your investments, and I’m really excited for you to run through those for our listeners. But before we get to investments, let’s look at income, debts, and expenses.

Laurin:
Okay. Well, my husband and I combined make about $281,000 a year that mostly is my salary. I make almost $210,000 a year working in the nonprofit sector and our debts are really just our mortgage and a HELOC connected to our mortgage. So we have about $488,000 on our house and about $84,000 on a HELOC.

Scott:
All right.

Mindy:
Okay. So, all that income and only those two debts?

Laurin:
Yes. Yes.

Scott:
Is there any variable income?

Laurin:
No.

Scott:
So, that’s just all salary?

Laurin:
It’s all salary. It’s all salary. Mm-hmm (affirmative).

Mindy:
Okay. Where’s that money going then?

Scott:
We just recorded another show With Scott [Ajita 00:05:10] and we spent 30 minutes going through their income story.

Mindy:
Income story, yeah. This is very simple.

Scott:
We’re done. Yeah.

Mindy:
We’re W-2 people.

Laurin:
It’s going to a lot of places, so the biggest expense that we have is our mortgage, which we refinanced to take advantage of the low interest rates and shifted to a 15-year fixed, which I know you guys have feelings about, but I really wanted to have that mortgage behind us. And so, that’s a little, it’s almost $4,200 a month between our mortgage, our insurance, and our taxes, which are all in escrow. So, that’s a big piece.
And then, we save about $4,000 a month. A thousand of that, I invest into a betterment account and then about 3,000, I’m really moving aggressively into our emergency fund, which has been low. And then the rest is comprised of a variety of expenses from our HELOC payment, our gasoline, which is $280 a month. We have life insurance and car insurance at 340 a month. Our utility is 280 a month, groceries, 660 a month, camps and childcare at $600 a month. We have aftercare for our kids and they’re in camp all summer because of our job schedules and it’s expensive where we live.
And then we have home. We spend about $700 a month in anything from running to Target, to paying for our alarm system, that sort of thing. And then I put a little bit of money away in a federal discretionary account. So, I put $200 a month away for holiday purchases, so we’re ready for Christmas for family and the kids. And I put $300 away into a travel fund so that we can pay for any travel costs with cash. We spent about $250 a month on charity or donations, and then $310 a month between cell and internet costs. And then we have miscellaneous costs between medical things like orthodontists, the gym, and just spending money, which is a little over $1,600 a month for those types of costs.

Scott:
And so total, we come to about 8,000, is that right?

Laurin:
Yeah, it’s about 8,000. We take home about $14,000 a month. And then, between our mortgage, which takes off 4,000 of that leaves $10,000. And then, I invest the amount that I mentioned and then the rest is all our living expenses.

Scott:
So, we have roughly 14,000 a month coming in and 8,000 a month going out. Most of that is the mortgage and housing expense, more than half of it. And we’ve got a pretty good investment approach with that. What’s the goal? We have no debts besides the mortgage and the HELOC.

Laurin:
Yeah.

Scott:
What’s the goal and then let’s walk through what you currently have from an investment standpoint.

Laurin:
I just want to, I mean, my career has been great. I work, as I mentioned, in the nonprofit sector, but when I started, I was making $24,000 a year living in the Bay Area and tried to stretch $20 over the month. And I really focused on building my income and really leaned into my own career development in the beginning of my adult life. And that took 13 years really to realize. And, at the time, I was saving, but I would save $20 into my 401(k) a paycheck because I just wasn’t making that much. And I upped it every time I got a promotion, but it wasn’t a whole lot and my company didn’t match in the beginning. So, I just felt like we were behind the curve for those early years when time is really on your side.
So now, I’m investing and saving as aggressively as I can, but I also really want to live and enjoy our life because I work so hard. So, we’re sort of in more of a slow fire approach to living. And that’s really what we’re focused on. How do we maximize the money that we’re bringing in, make smart investing and saving decisions right now while being able to enjoy the things we want to do with our family and our kids. And so, that’s really the goal. And then hopefully, I can get to a point when the house is paid off, that I can make different choices about what kind of career I have and how much income I need to have coming in. I can consult or really scale back or even try something new and break out of the grind that I’ve been in for the last 20 years trying to build up my career.

Scott:
Got it. Well, let’s walk through your current investments first and then I’ll give you a couple of thoughts that are starting to form in my head here.

Laurin:
Okay. So, right now in our 401(k), we have about $390,000. Most of that is in my 401(k) and a little bit in my husband’s. I max out my 401(k) and then my company has a pretty generous match. So, they match 6% of my salary just flat out. And then they also match 50%, up to 4% of my contributions, which is really great. And that’s helped us save over the last six years that I’ve been with them.
My husband’s 401(k) is not great. I don’t love the investment choices that his company offers. And so, we’re investing just a little bit, maybe $150 a month into his 401(k)s, so we’re not maxing that out. And that’s one of my questions for you is whether or not that would be something to consider.
We have about $40,000 in a Roth that I saved when I was making underneath the threshold, but now we’re over the income limit for Roth. So, we aren’t investing in a Roth, but I have been looking at doing a backdoor Roth conversion. And that was another question I had for you as well.
We have about $21,000 in an emergency fund in a high yield savings account. And we have about $30,000 in a brokerage account comprised of just a few different stocks that I purchased actually in my 20s. And then I have about $35,000 in our betterment account.

Scott:
All right. So, how would you peg your net worth? I’ve been trying to follow here, but four, 500 outside of the primary?

Laurin:
That’s correct. So yeah, we have about $500,000 invested and then our home comprises a big piece of our net worth.

Scott:
And how much is the home worth and what’s the debt against the home?

Laurin:
So, we have a mortgage of 488,000 and right now the home is worth around 1.1 million.

Scott:
Awesome. And you have a HELOC as well, right?

Laurin:
Yeah. We have a HELOC that’s 84,000.

Scott:
All right. So, here is my instinctive reaction to what you just kind of have articulated here, is obviously you’re doing great. You have income and expenses and a huge gap between the two and you’re investing. But my first reaction is that what you’re building towards here is almost all of your wealth is going to end up inside of that 401(k) and that home equity, given the choices you’ve made without a change in allocation strategy.
And so, if your goal, as you said earlier, is to get yourself out of that grind or have a chance to slow roll in a few years, this is not going to do it or you have to change your asset allocation here with a couple of these things.
Your biggest investment decision, whether you’re making it on a conscious basis or not every month, is $4,200 towards your mortgage on that 15-year note with that. So, every month, you’re just cashing into equity in this home that’s worth $1.1 million, which is maybe appreciating at certain rates. Obviously you’re in a good market if the home is worth that much with that. But that’s the asset allocation strategy here. That’s being implemented currently without a change in place. And the rest of it’s going into the 401(k).
So, your situation is you have $50,000 or so, which is six months in your savings account and your brokerage account. I guess you also have the money in betterment, but you have a little less than a hundred thousand dollars available to supplementing your income right now. And it’s probably generating a few thousand dollars a year at most in dividend income, I’d imagine, which is totally irrelevant or immaterial to your position with that. It’s not even 1% of your household income likely is coming from these passive sources at this point in ways that you can access.
So, am I kind of stating the elephant in the room? Is that the place to start maybe with this?

Laurin:
Yeah. That’s a great place to start.

Scott:
Yeah. So, look, if you want an event to happen in 10 years where you cross the threshold and you’re done, this is going to do it because you’re going to be at this point where you’ve got a huge 401(k) balance, you’ve got a paid off house and you’ve got whatever was left over and these other things to last you until traditional retirement age. And this will do that, but you will not have a continuum where your position is steadily improving in a way that’s giving you freedom in the here and now with this asset allocation approach per my estimation with this, because you just have no assets available to spend with those types of things.
All your wealth will be in the 401(k) and the home equity. So, if you want that, that’s fine. But if you want to gradually begin reaping more and more freedom from a day-to-day perspective in the here and now, here are the first places I would start.
One is taking that awesome, great match. Of course. Let’s do that. But then, can I refinance the home into a 30-year, for example, and allocate 3,000 or 2,500 to that mortgage payment instead of 4,200 and the rest into more accessible investments like brokerage accounts or real estate or those other types of things are buffering my emergency reserve there, or just paying down the house? I think the difference is 1.6 years, between a 30 year and a 15 year at a certain interest rate assumptions, Mindy and I did the math a while back in one of the former money shows, but you still retain that option to pay down the mortgage in 16 years, I think is the difference with that. But what’s your instinctive response to what I’m describing there and pointing out where I think this is likely to lead over the next couple of years with your asset allocation decision?

Laurin:
Yeah, no. That’s exactly what I’ve been sort of grappling with is did we over-allocate ourselves toward our house payment and are we losing … I already feel like we lost time on a front end of my career and are we losing time now in being able to invest more and do we want to refinance, even though we just refinanced within the last year? Do we want to refinance again and stretch that out so we have more flexibility with where our money is going? And even if it’s going to a place where I could eventually pay off the house, if I wanted to down the road, I’m investing now.

Mindy:
So, I heard you say at the very beginning of the show, “We have a 15-year mortgage because we wanted to pay it off.” So, that says to me, and I agree with Scott that you should get a 30-year mortgage because it’s longer, but I’m also not making any of your mortgage payments for you. Sorry. And that is wanting to have the mortgage gone is an honorable desire. It’s a personal preference. Financially, I think it makes more sense to have a 30-year load because the payment is so much lower, but Scott, she’s also making boatloads of money. So, I think that’s a conversation for you and your husband to have, how much do we value having a paid-off house versus how much do we value more room in our monthly budget?
I have several questions. You have approximately a $6,000 difference between the income and the monthly spending. And you said 3,000 is going to emergency fund, 1,000 is going to investments. That’s still only $4,000. So, there’s another $2,000 someplace that isn’t quite accounted for. You don’t have to answer to me. I would encourage you to go back through your spending and see if there’s either unaccounted for spending and maybe your monthly spending is closer to 10, or are you putting more towards your emergency fund or more towards your investments than you think you are, but also how much do you want your emergency fund to be? Because if you continue that the rest of this year, you’re going to have an additional $36,000 in there. You have 21,000 in the emergency fund now. Are you aiming for a certain number of months of spending in there or …

Laurin:
I’m aiming for around 40 to $50,000 in our emergency fund just to have coverage for four to five months of … If you eliminated some of the savings and investings that we do, our raw, fixed costs are around 5,500 to 6,000 that we would really need to make every month. And my job security is pretty good and I work in an industry where I’m in high demand. So, I’m not worried about getting a new job. So, I don’t feel the need to have a hundred thousand dollars in our emergency fund. I’d rather put that into something that can grow and be a little more aggressive in terms of investment return.

Mindy:
Okay.

Scott:
Where do you want to be in three to five years from a … Do you want to be in the same location that you’re in, in the same house, in the same city? What do you want to be doing at that point or what is the timeline? Is it a seven-year outlook? Depending on the age of your kids with those kinds of things, what is a good timeline to begin thinking around like, “At this point in time, I want to be here.”

Laurin:
Yeah. So I think we love where we live. We have a really great lifestyle here, and we love our home and it’s a fine home. And so there’s part of me that’s like, “Let’s pay it off and have that freedom and flexibility to do whatever we want and rent the house out and live in Spain for three months,” or do whatever we want.
My daughter will be in college in five years and my son will be in high school. So, we’re looking at the college years for the kids. That’ll all be wrapped up, but they’ll be through college by the time we have our house paid off or in that 15 year time window. So, that’s really where things get pretty flexible for us.
So, in three to five years, I sort of imagine myself here doing the same thing, but having a different position in terms of our investments and just really being diligent with that.

Scott:
Okay. So, in that case, what I’m hearing is three to five years, same spot, but in seven, eight years, kids are in college. That’s when we want the optionality that the finances can afford with that kind of stuff. Is that more of a specific way to frame, to begin thinking around things?

Laurin:
Yeah. That seems right.

Scott:
So, look, in that case, planning on around an event-based system like this, where it’s not gradually compounding makes perfect sense if you could just back into, “Hey, in seven years, if I just keep doing what I’m doing and keep my expenses low, I’m going to have pretty much a paid off mortgage, house is done. I’m going to have a really nice, fat 401(k), and I’m going to steadily increase my after-tax brokerage accounts and emergency reserve over that period of time,” you’ll probably have a million or two, a million plus in investments with those types of things and a paid off home. And your expenses drop to 3,800 a month, all in with that, maybe less when the kids are in college with that.
So, in that case, you probably don’t have to change too much if you want to do that, but just know that you will be grinding for the next five, seven years from a financial position. And you will not have a lot of flexibility or freedom with that until you’ve kind of eliminated it unless you make a change with those types of things, I think. Mindy, what are you reading?

Mindy:
I’m hearing a lot of those same things. I’m wondering because her company has such a stellar 401(k) match. What is the lowest amount of contributions that you can make to get the entire match? And I would almost want to start doing that, reducing your pre-tax contributions while still getting every dollar that they’re giving you because that’s free. And then just changing that to an after-tax …
Well, because you’re at such a high tax bracket, what are you really reducing your taxable income? It’s like after a certain point, you’re not really doing anything for … Do you know what I mean? Does that make sense?

Laurin:
Oh yeah. That was my thought. Yeah.

Mindy:
So, I think you’re at that point. Yeah. I think you’re at that point. So, let’s go ahead and pay the taxes on that you’re already going to have to pay anyway. Put them in the after tax. You mentioned that you have some after tax in a brokerage account, individual stocks that you bought when you were in your 20s. Yay for you because there’s a lot of people who did not do that. I think you did a great job with what you had at the time. So you’re unnecessarily harsh on yourself because you’re still in a really great position.
And then, I would personally put that money into index funds. I really like index funds and we have been divesting ourselves of our individual holdings that we no longer want to have and putting it into index funds. So that’s something to look into if you don’t have the company knowledge and time to research the individual stocks, I wouldn’t necessarily recommend going into specific individual stocks. Do the whole index fund, read the book Simple Path to Wealth and he’ll tell you the same thing in a lot more words. It’s still a good book, but sum it up, index funds.

Laurin:
There are only a few stocks that I’m invested in, in that account and they’re all pretty solid companies. So, I feel like they’ve … I mean, I only invested $1,500 and it turned into $30,000 over this time.

Mindy:
Wow!

Laurin:
So, yeah. And I had no money. I was like, “Oh, my God, I’m going to buy a $50 stock.” And I was so nervous and it paid off in the end, but yes, mostly I’m in index fund.

Mindy:
Okay. Good. And then, I don’t know what current mortgage rates are. I haven’t had any clients getting a loan lately. So you have a really low rate, 2.375. That’s an awesome rate. I would not refinance out of the mortgage at a 15 year to go into a 30 year at 4%. So, I would look into what rates are. Just get a quote and see. You don’t have to do anything with a quote.

Scott:
Well, I just want to chime in and say, I slightly disagree with that. In your situation, if your goal is to back into an event seven years from now where you’ve got your home paid off and 401(k) and those types of things, then the current situation makes a lot of sense. But personally, if I was in this position, I would be trying to accumulate more wealth outside of the 401(k) and the home equity and think about investing in other assets, just because the way I’m wired and the way that I think maybe a lot of listeners are wired. And my first step would be refinance that mortgage out of that 2.3%, 15-year fixed and into a 30 year and wipe out the HELOC at the same time.

Mindy:
I was going to say that.

Scott:
And that combines your mortgage payment to what? 550 and probably drops your payment from 4,200 to 3,000 or so.
And that frees up a lot of extra cash to begin investing in alternative assets outside that 401(k), whether it’s brokerage investments, real estate, or alternatives with that, because what would happen in that situation is you would not have an event for 30 years where your mortgage is paid off, but you’ll be able to arbitrage. You’ll likely get spreads on that with index funds or real estate with that. That said, it’s not the wrong answer. There’s no right or wrong with any of this kind of stuff. It’s just, that would be how I would approach this situation if you transplanted me into your shoes with that, because I’d make a large series of different allocation decisions. And that would just lead to, I think, a steady state compounding of options over time that will gradually materialize over the next one, two, three, four, five, seven years. But in seven years, you’ll be in a still growing position rather than a finished position with a lot of those things. That would be, I just wanted to … Sorry, Mindy.

Mindy:
No. That’s okay. I’m going to stick by what I said and say that if you are going to significantly increase your interest rate, then how much different is your monthly payment really? So, and when you do this, I would absolutely roll the HELOC into the mortgage and pay that off with the new mortgage, if you go that route. So, when you’re considering how much money am I saving, add the HELOC payment into your mortgage payment. So mortgage is 42. What’s your HELOC payment right now? I think that’s going to be a hefty payment.

Laurin:
It’s not that bad, actually, because our HELOC is at a pretty low interest rate as well. I mean, it’s the interest rate plus prime, but right now it’s 2.8. So, we got a pretty good HELOC rate, but I know it’ll adjust. So, our payment is around $400 a month and I always overpay. I pay around 650 a month onto that HELOC.

Mindy:
Okay. I, for some reason, had typed in a 6% HELOC rate.

Laurin:
We just refinanced our HELOC to adjust it down. Yeah.

Mindy:
Oh, okay. Okay. Okay. I was like, “Where did they get the 6%?” Okay. So, the two points that you have on the HELOC now, it makes a lot more sense, too. So, okay.
Let’s see. What other questions did I have? Oh, so yeah. If I were in your shoes, I would call around and see what mortgage rates are right now. If you can get something close to this without an enormous amount of closing costs to refinance, that might be something to think about, or at least have a conversation with your husband. We went down to a 15 year for these and such reasons. What do we think about a 30 year? We could do some other things. Does your husband have any sort of match at his 401(k)?

Laurin:
No, he doesn’t.

Mindy:
Then I think the bare bones that you’re doing there, or maybe even stopping. I mean, it’s only $150 a month and put that into after tax as well, just because there’s no real benefit at your tax bracket and at his no benefits part of it, it doesn’t seem like that’s a good place to put any money. Scott, do you agree with that?

Scott:
Yeah. I think that the game here from that perspective is shelter as much. Your approach to investing is, “I’m going to pay off the home and invest inside the 401(k).” And you earn an enormous income right now. So, to me, that says pre-tax contributions, defer taxes now, pay them later makes a lot more sense in your case then maybe another situation where we’ve got a lower income earner who’s buying a lot of real estate, for example, with a lot of those things. So, I like that, I think, in a general sense.

Mindy:
Hmm. That’s not what I was saying. Maybe I’m misunderstanding you or maybe you’re misunderstanding me. I was thinking that because she’s already at this super high tax bracket, reducing that by $20,000, she’s still going to be paying a lot of taxes on that.

Scott:
Well, I’m saying that that’s the whole game, because she earned so much money-

Mindy:
But you think she should continue to contribute to her 401(k) pre-tax?

Scott:
I think that, like what we said, what we decided earlier is, Laurin, your strategy is I’m going to pay off my house and back into a seven-year timeline where I’m going to be able to then reap the benefits of that freedom. And, at that point, you’re only going to need three, $4,000 a month in passive cash flow because you’re going to have a paid-off house with this kind of stuff, right?

Laurin:
Yeah.

Scott:
And two kids in college, your expenses are going to drop considerably with that. And so, if that’s the goal, then you just pay off that house and fund your 401(k) all the way through, defer those taxes as much as you can and invest the rest in a couple of after-tax brokerage accounts and pile up those things.
I think, for me, I like deferring all the income right there, because your plan is not to generate an enormous income in retirement with this. Your plan is to hit some singles and do the base hits, enjoy life with that kind of stuff and flow through I think a really traditional approach to retirement with that. And if you’re going to do that, I like sheltering all the money behind the 401(k) and your circumstance with this and not doing the Roth.
I’m going to try to convince you one or two more times before the end of the episode to change that entire mentality and refinance to a 30 year potentially, and build more assets outside the 401(k), because I think you’ll reap more of those benefits and flexibility over the next three to five, seven years than you will with that strategy. But if that’s your plan, you’re going to pay off the mortgage. In that case, I like the 401(k) and sheltering the taxes a lot with those types of things. Does that make sense, Mindy, where I’m coming … Every time we have different advice for the guests, but I’m trying to steer it to what is see is the strategy.

Mindy:
I know. Every single time, it’s … Okay. So, my thought is she’s in the highest tax bracket. She can contribute $19,500 to her 401(k). So she’s really only sheltering … What’s the highest tax bracket, 38%? I’m not there yet.

Scott:
Yeah, but she called it. Yeah.

Mindy:
She’s sheltering 38% of $19,000 in the grand scheme of her investments and her income. That’s not really that much money. And she has all this money in the 401(k). But, as you were talking, I started thinking, “Oh, in 15 years, she’s going to be 57 years old. She’s only got a year and a half before she’s 59 and a half, which is when you can start accessing these funds.”
So, there’s a lot of moving parts. I got to make sure I take them all into account. This is not as easy as you think it is.

Laurin:
See. This is why I called you.

Scott:
Yeah. Yeah. But no, this is perfect. So, look. The plan is, and again, I’ve already caveated it, but the plan as we got it right now is in seven years, both kids going to be in college and I want an end state at that point in time. And that end state is paid off home, but a flexible overall financial position with all that kind of stuff.
So, you don’t need any of that money right now. You are generating 14 five a month after tax. You have no bonus. There’s nothing complicating this. You have $14,500 in cash coming in. You get $8,000 in cash coming out. A huge chunk of that 8,000 is going toward the mortgage and your HELOC and that’s inclusive of that. So, I got 7,500 a month coming in to allocate with that.
And you’re going to put 20 of that towards the 401(k). That’s two-and-a-half months. Okay. Now we’ve got another nine-and-a-half months of excess to go after with that. I say just max out the 401(k). Take the nice match for both of those. Fill up yours, fill up your husband’s with that. Now you still got $60,000 left to invest after that. That’s plenty to dump into the after-tax brokerage accounts and clean up your debts with a mix of allocation there. In seven years, you’re sitting pretty with the HELOC paid off, most of that mortgage gone, and probably several hundred thousand dollars in after-tax brokerage accounts, in addition to a very, very fat 401(k). And that’s the game plan there, but I would take every dollar of tax deferral that you can with that strategy.
And then, you can either choose to keep working, or you can begin doing the Roth conversion ladder with that 401(k), if you choose to stop working. And that’s where you can begin moving that money through a Roth conversion ladder.
So, your plan is I think very conservative with this or the goal is very conservative with a lot of this stuff. But, I like, in this case, dumping it all in the 401(k)s, both of them. And then if you don’t like your husband’s 401(k), you can just roll it over whenever he leaves the job with that. But for me, that would be the asset allocation strategy to back into the outcome that you’re looking for that I think would make a lot of sense. Mindy, does that make sense why I’m against the 401(k) in a general sense, but for it in this particular circumstance?

Mindy:
Yes, because of all the specific things in her situation. Yes. So, okay. I understand what you’re saying now. This is so much fun.

Scott:
Yes. We have a lot of different things here with that. And so I can see Laurin is smiling with some of this stuff, because it’s probably different than what you’ve heard us say on past shows.

Laurin:
No. No. This tracks.

Mindy:
So, let’s talk about those kids and their college funds or call it paying for their college. Are they both interested in college and is college the right choice for them?

Laurin:
Well, that’s a very good question, Mindy. And I struggle with that, honestly-

Mindy:
Same.

Laurin:
… given I have a little sticky note right behind my computer, the Price You Pay for College, the book that was recommended to me by a friend and I struggle with how expensive college is. And part of the reason that I had a late start and we didn’t have excessive student loans, but I came out of college with some student loans, about $15,000. My husband had about $22,000 and making $24,000 a year, it was really hard to get by in a high-cost-of-living area.
And so my goal for my kids would be to get them through college without absorbing any debt for themselves, but we don’t invest in a 529 plan. So I don’t have a ton set aside for them. We have about $15,000 in betterment accounts that I’ve just put aside for my kids right now, but I know that’s not going to really make a major dent depending on what kind of college they want to go to.
But my daughter is interested in college. She talks about it. My son is eight and he wants to be a pro skateboarder right now. So, he’s not quite talking about college yet.

Mindy:
Hmm. Okay. You don’t need college to be a pro skateboarder. Good luck to him.

Laurin:
True, true. Yes. Good luck to us, too.

Mindy:
Good luck to you. Yes. Keep that health insurance.

Laurin:
Yes, that’s right.

Mindy:
Okay. So there are lots of creative ways to pay for college. We have a question in our Facebook group right now. “What are some creative ways to pay for college that you have done?” Julien from rich & REGULAR worked at the college. And I think he was getting a master’s or an accelerated level of education, but his college charged him $25 per semester for college. I know. I’m like, “Why even bother charging,” but whatever.
So, getting a job at the college and planning to have a job at the college can help you with the reduction in tuition, going to a state school instead of going to an art school, studying a real thing instead of studying fashion design that you actually have no interest in are all really good suggestions.
Zach Gautier, Gautier. I’m sorry I’m butchering your name, Zach. He came on the podcast, oh, I want to say … Well, let’s just look it up because it was not that long ago. Here we go. Episode 64, I guess it was a little bit while ago with lots of different ways to pay for college. The military could be an option. Do either of you have military benefits that you can pass along to her? Home Depot, Starbucks, maybe Costco. Maybe not Costco. I can’t remember. They have tuition assistance programs and tuition, I don’t know if it’s a reimbursement, but there’s a lot of options to pay for. And now that she’s what, 13, 14?

Laurin:
She’s 13.

Mindy:
She can start thinking about this. When she enters high school, she can go into AP classes if that’s something that she’s interested in.
We have an international baccalaureate program that my daughter is specifically attending one high school so that she could participate in that. And I think you graduate high school in four years, but with the freshmen year of college already done, too. So, the credits transfer over. So there’s a lot of options out there to help you reduce the cost of your college. But there’s also a lot of really easy ways to incur a boatload of debt.

Laurin:
Yeah. I think that we talked to them … Well, I talked to my daughter a fair amount about college and the cost and the reality of it. And she is laser focused on working at Starbucks, not only because of the college tuition, but because they do a 401(k) match. And I talked with her about the benefit of investing early.
So, we are talking through that, whether she goes to community college and then transfers to a four year, we’ve talked about some of the ways you can hack living expenses, which comprise so much of the cost of college by doing residence assistance or getting a job, as you mentioned, in college.
So, I think those are all options we’re exploring. It feels kind of fantasy right now because I have no idea what that’s going to look like because she’s just entering eighth grade and so she’s still a little bit far farther away from that, but I think those are all real. And then we put them both through private daycare because of we were working, and in my area it’s quite expensive. So, that was almost $20,000 a year for both kids or $20,000 a year and my kids are five years apart. So it was a 10-year span where we were spending that completely.
And so, part of my calculation is, if I had to, I could cash flow college for them to a degree that would be similar to, but maybe slightly more expensive, depending on the school, what we absorbed when they were really little and we needed that help.

Mindy:
Yeah. That’s a good point. Yeah. Child care’s so expensive. It doesn’t have to be all them or all you. It could be a hybrid situation and, “Get great grades and I’ll help you more. And if you mess around, then that’s on you.” And tuition reimbursement based on that grade. What is it when you get your report card?

Laurin:
GPA? Yeah.

Mindy:
Yeah. So, but there’s lots of options and planning ahead is great. So having the conversations ahead of time, it really helps to plant the seed. “Hey, this is what happened to me and this is I’m at now,” versus, “You could get a jump on it.”
Let’s see. What other challenges do we have?

Scott:
Just chiming in on the college thing, I don’t think for me the college thing changes too much about the asset allocation strategy that you’ve got here. We’re still backing into a seven year, 10-year time line with this kind of stuff. At that point, you’ll have a paid-off house, 401(k), after-tax brokerage accounts, and numerous options to pay for the college.
So, I would just kind of go right on through your list with this kind of stuff, sheltering as much as you can from taxes while you’re earning a tremendous salary and all that kind of stuff with this 401(k), maybe the 529s, if you’re interested in using that as one of those things, but that’s a really limiting option. You don’t have other choices for that. And when college comes, you can either cash flow it by continuing to work or ELOC, or other types of things with that.
But I think your highest and best use is the index fund investments inside of your 401(k) with this approach. And so, the more you can put it towards that, that’s going to increase your overall wealth and then you’ll have an option in one of several areas to tap into, to pay for the college downstream. You’re not going to have any trouble paying for college with your income is the good news. You’ve won because of the work. You’re like, “Oh, I got a late start.” Well, you got a late start because you were focusing on the right thing and now have a situation where you just generate so much income that you’ll be able to solve all your problems with all that, with just a pretty fundamentals-based approach here.

Laurin:
Yeah. So, I mean, yes. I agree with you. I feel like I’m less concerned and I’ve always sort of been less concerned about college, both because I didn’t want to tie up investments in accounts that were specific to that, not knowing what my kids would do, but also because, as my income grew, I felt like we could figure that out. But I feel like if we build up our emergency fund by the end of this year to something that feels right to me, then we’re going to have a significant amount of money to invest every month. And even if we max out my husband’s 401(k), we still have money left aside.
And so, I’m really grappling with, do I beef up what I’m putting into betterment and put it into that index fund? Do I think about doing a backdoor Roth conversion alongside that just for six grand a year or more with my husband and then are there other ways to think about how we’re using our after-tax money strategically to really build wealth over time alongside the 401(k)? And I think that’s where I struggle a bit.

Scott:
Yeah. I would start with both the 401(k)s. You’re at a nonprofit, so you probably don’t have any SPP or anything like that. Then, I think the backdoor Roths are a great option following that. If you have an HSA plan or that option available and that the family health issues allow for that, then the HSA would be awesome for both you and your husband to max that out and invest that. I’d probably even do that after the match, but before the remaining maxs to your 401(k) with a lot of that stuff. Then, I think the Roth would be the third item after that. And then are there other options for sheltering some of that money pre-tax and that’s where you can think about the 529 plans. If you think that there’s a clear minimum you’re going to spend on college with that, the 529 plans can be another good place to shelter money pretax.
And you’re going to then still, I mean, if you max out both 401(k)s at 19 five a year, and this is all pre-tax and your tax bracket is going to be enormous with your income and being in California with that. So, that’s incredibly advantageous. That’s not actually going to make as much of a dent in your after-tax cash flow as you think, maxing both of those out.
You’ll still probably have 60, 70, 80,000 a year to invest. And so, even when you do go through the backdoor Roths and those two tactics and 7,200 into the HSA, you’re still going to have 50 grand leftover after that. Then you, even you maxed out your 529s, you’re still going to have 45. And so, that would be where you put that into the after-tax brokerage.
And so, that’s where I think, if you think about it from that position, it’s a very luxurious position to be in where you can go through the whole list and still have plenty left over, I think, to beef up your emergency fund and those other types of things based on what I’m seeing here while paying off a 15-year mortgage.

Laurin:
Yeah. We don’t have an HSA at my work, so I always listen to you talk about that and wish we had one, but it’s not an option. So, I think that’s the only thing I’m not able to tap into.

Scott:
That’s because you hear it offers good healthcare, then.

Laurin:
Yes, they do.

Scott:
What of that list, does anything appeal to you or do you feel like any of it is stuff to do?

Laurin:
Yeah, no. I mean, I think, given the high tax bracket that we’re in, beefing up my husband’s 401(k) has been appealing. I just hate the investment options he has. They’re all high fee mutual funds. So there aren’t any index in options. And so, I’ve always struggled with putting our money there, but we can do that just to shelter more of our income. And then, for me, once we have our emergency fund taken care of, it’s just dumping as much as I can into after-tax investments.
And so, that it provides us some flexibility. If things change before our 15-year time horizon, if I want to scale back my work a little bit, because I want to spend time with my son before he goes to college, I want to have a little bit of … The more flexibility I can build to give myself options, I think that’s where I’m starting to lean at this stage in my career where I’ve worked so hard, that I feel like it would be nice to know that as an option, even though I’m very comfortable working and I’ve been working since I was 16 years old. So, I just don’t know anything else, but I can feel myself longing for a little bit less stress.

Mindy:
Okay. So, less stress. Does less stress look like fewer hours? It sounds like you like your job and you like what you do. You’re in high demand. I think after you’ve got the mortgage paid off, which is important to you, you’ve got a good solid foundation of the investments. I can see something where you pull back and you do consulting for 10 hours a week, still making a lot of money. And therefore you’re less stressed because you’re only working 10 hours a week. You’re still generating some income and you’re still doing something that you like to do. Does that sound like I’m going down the right path?

Laurin:
Yeah. You are. I think I’m in a management position. I have a big team. There’s a lot of demand on me. And the idea that I have both less hours and maybe less demands of my time, not just in physical hours working, but just what I do when I’m at work is appealing to me.

Mindy:
So, I think a good exercise would be sometime in the next six to 12 months, start thinking about what parts of your job you really love and what parts of your job you really want to pass off to somebody else and see if there’s a way to craft a position. Maybe you don’t make 210 doing this. Maybe you make 175 and that work-life balance is so much better that it’s worth the reduction in hours, or maybe you continue going whole hog and getting raises and continuing to climb as high as you can and then pull back a little bit.
But, I think really sitting down and making a list of the things that you like to do and the things that you want to keep in your life helps you start thinking about how to craft a job that you’re looking for and poke your head at the job market and see what maybe somebody else at the non-profit down the street is looking for those same things that you want to do at a reduced rate or reduced hours that make sense in some way.

Laurin:
Yeah. Yeah, no. That makes sense.

Mindy:
Could your husband get another job? Does he have the opportunity? And we haven’t really talked about him very much here, but you said that you are making more money than he does. Could he hop to another job? Has he been at his current job for a super long time? Is there a job that has better benefits? Is there a job that has an HSA plan that you guys could take advantage of? Has he explored anything like that?

Laurin:
Yeah, he hasn’t. He’s been at his job for quite a while. He doesn’t have great benefits there. They’re all really on me. He could definitely hop to another job, though I think at this stage, I’m definitely the career-oriented one in the family and he is the stability one and a great chef. So, that’s where he really leans in, but I think he would love to do totally different things with his day than what he’s doing right now. And I don’t know if that is a different job or just leaning into his own hobbies and his own passions.

Mindy:
I would encourage him to make a list of all the things that he wants to do and see if you can craft a job around that. Or I don’t know that right now is the best time for entrepreneurship like him quitting his job and starting entrepreneurship, but maybe there’s some side business that he could start or start looking into that. But yeah, if you’ve been at your job for a really long time, your company isn’t as incentivized to just give you a big bunch of extra money, but if he could take his current skills and hop a job and make an extra 20 or $30,000 a year, you can just take that and throw that into the after-tax brokerage accounts and the emergency fund and all of that.

Scott:
Do you think he will be there for many more years?

Laurin:
It really depends. He’s not as motivated to change careers based on financial gain. So, I think he could stay there until he retires. He could also switch it up, but that’s just not where he spends his time thinking about his life. Career is what I do, I get up, I’m part of the family, I have a paycheck, and I contribute, but his interests and passions are sort of external to his professional life.

Scott:
Okay. Well, I was more asking just in the context, going back to the 401(k), you don’t like the investment options in there, but again, if you just dump money in there for a couple of years and then transfer it over to a better plan in the future, you’re good to go with that. So that’s the big, I think, financial question from an allocation perspective is you could just have him max that out, but if you think he’s going to be there for 20 years, investing with the huge fees in that plan, maybe that changes the math a little bit, but if it’s going to be three or four years or less, then those fees don’t really matter because they’re not going to have enough time to really drag your performance as much as the tax benefits might accrue to you.

Laurin:
Right. Yeah. Those are good food for thought.

Scott:
Awesome. What else should we cover for you today?

Laurin:
Well, the only other thing I have explored is whether or not I want to think about real estate investing. And I definitely don’t want to think about that in the area I’m currently living, just because it’s such an expensive market, but then that makes me really nervous about thinking about going into real estate investing in a location or a market I don’t know very well or that is even out of state to us, but that’s something that I’ve been thinking about even that could become a side hustle for us or for my husband, if we wanted to build up a rental portfolio and have that be something that we work on together, or even if I were to dial back my career at some point, that’s been the least thought out piece of our investment strategy. We’ve really been pretty conservative or traditional, as you mentioned, Scott. I’m just thinking about index funds, but it’s something that I’m curious about, although this current market and just how frenzied it is intimidates me.

Scott:
Yeah. I obviously am a big fan of real estate investing, not that I’m biased by any means, but I think that that would change everything about what we talked about earlier in terms of asset allocation strategy. I think that investing in real estate is possible with your current, just because you earn so much income and spend so little that you can still probably put your house in a 15-year mortgage and contribute to 401(k)s and have money left over to make down payments on rental properties with that.
Here are two traps to avoid as you move in, as you think about this. One is we’ve seen California investors investing in the Midwest using their HELOC to purchase the property. That is a trap. The HELOC is a five year … You can think of it as a short-term vehicle. So, if you put $60,000 down on a rental property out of state with using your HELOC, think of it as a five-year repayment period. That’s a thousand dollars a month plus interest going towards it. That’s going to eat up all of your cash flow and then some, and you’re actually sucking cash out of your life, not enabling your freedom and creating passive cash flow, at least for the five-year, six-year period with that. So, it’s a very high stress way to go about accruing rentals using the HELOC to finance the down payment in most cases. Even without interest, if you just assume it’s 0% interest.
The second trap is if you buy a $100,000 property that produces $200 a month in cash flow, you’re producing $2,400 a year in income, which is much less than 1% of your total income. So, you’ll have to buy 10 or 20 of those to be 10 or 20% of your income and be at all relevant to what you’re doing from a job perspective. So, if you’re going to go into real estate, I think you should consider a way to make the investments in a system or at scale large enough to be somewhat meaningful to your financial position.
I’d be very wary of an approach that was less than 10% of your annual income, which would be $24,000 annually without a path to get there within a few years, because you’ll just be frustrating yourself and creating a huge pain in the neck compared to … Your salary will increase much more than that over three years, most likely, just with inflation then that will generate. So, those would be the two traps to avoid.
But outside of that, I love real estate investing. And I would just encourage you then to divert a larger and larger share of your cash away from the home payments and the 401(k) in that case to the rental properties, if you think you can get that kind of return [inaudible 00:57:01].

Mindy:
Yeah. Another trap I would recommend avoiding is the trap of, “Oh, well a house cost $1.1 million where I’m at. Clearly this hundred thousand dollar property is a better deal.” And I think Scott touched on it a little bit. Just because it’s cheap doesn’t mean it’s a good investment and you can still lose money every month on a hundred thousand dollar house as well.
So, if you truly want to learn about investing in real estate, I would watch one of Brandon’s webinars on Wednesday, how to analyze a rental property or how to run the numbers and just start running numbers, pick a place that your grandma grew up or your sister lives in or something so that you can just see the cities. And the Midwest is a great cash flow area, but not all areas of the Midwest are great cash flow areas.
So, if that’s the place that you want, pick a location, find some properties and start analyzing those deals just to get a feel for how to run the numbers, because once you figure out an area. I know my city really well. I know that that house across the street is a terrible investment because it’s going to generate negative cash flow forever. I mean, probably not forever, but for a really long time. That’s not what I’m looking for.
So, if you’re investing in real estate to make money, don’t buy a job that costs you money every month, which kind of tags off on what Scott said. But I mean, it’s really easy to live in a place that’s really expensive and look at people buying $50,000 houses thinking like, “Oh, I can do that all day long.” Well, yeah, but are you going to really make any money on it?
So, it’s totally okay to ease yourself into rental investing or any sort of investing. And if real estate is exciting, but you don’t want to be the landlord, what about REITs or syndications or something like that? So there’s all sorts of different things to invest in real estate. If you haven’t decided on a plan yet, you should read the Ultimate Guide to … What’s the UBG called?

Scott:
The Ultimate Beginner’s Guide to Real Estate Investing.

Mindy:
There we go. The Ultimate … Like, “Where’s the B?” The Ultimate Beginner’s Guide to Real Estate Investing is www.biggerpockets.com/ubg. And that’s a great free resource for the different ways to invest in real estate, because it isn’t all just tenants and flips and that’s it. There’s a lot of different options. So, that’s a great place to get started.

Laurin:
Okay. Thank you.

Scott:
All right. What else can we cover?

Laurin:
I mean, I think those were my main questions. I feel like the savings and investing I’ve done all on my own. My parents, we never talked about money. And so, it’s just helpful to have a sounding board to sort of figure out, am I doing this right? What am I missing? Where are my blind spots? And if I continue on this path, am I going to hit those goals that I have? And so, just having your feedback and advice is so helpful as I’m trying to trudge along and get to a place where I can sort of think through a different lifestyle for myself that I’ve never really had.

Scott:
Yeah. I mean, your overwhelming advantage is the incredible income, which is a clear sign of competence developed over a really good career here with that so that’s awesome. But, like we mentioned at the beginning of the show, I think the biggest decision you have to make about is about whether or not you’re going to allocate that capital towards that home, because most of your investment approach is I’m going to pay off my home and then use what’s left over to put into the 401(k) and other investments. And that’s totally fine, but that’s your biggest strategic decision that you’ve made and that you’re making with this. And that will, I think, determine a lot of the other outcomes with a lot of this stuff.

Laurin:
So, I have some research to do.

Scott:
Well, yeah. I think you have some research to do and think about like, “Hey, if I want to do these other things,” then your problem is like, “Hey, you can probably do it all, but it’s just irrelevant to your …” Where are you concentrating your resources? You’re concentrating them on paying off the mortgage with that. And that’s the challenge with when you have such a high income is if you buy real estate, for example, $60,000 a pop. That’s going to annoy you, not generate wealth for you, which is a good problem to have because you’re doing really well. You’re a top earner.

Laurin:
Yes. I don’t need more annoyances. I need fewer, but I guess that makes me think about I’ll consult with our mortgage broker and see what the rates are, but there’s part of me that I don’t struggle with, but because I spent so much time focused on my career growth at the beginning, and didn’t save as aggressively, I’m looking at this 15-year time horizon and thinking, “Okay, this is where you could really double and triple down on that if you wanted to and if I scaled back some of the money that’s flowing into our home, I might be able to reap the benefits of that time horizon more successfully than if I’m only investing my home and then whatever I have left there is just the equity in that plus whatever income looks like at that time.” So, that’s, I think, the crux of my question to myself.

Scott:
Outside of your home, your expenses are 3,500 a month. So right around that.

Laurin:
Yeah, yeah. There might be a little bit more than that, but yeah.

Scott:
Okay. 4,000. Let’s call it 4,500 to be conservative with that. So, you’re spending 50,000, 60,000 a year outside of the home on 280,000 in income, whatever it is. You are thus accumulating probably 100,000 at minimum that you are deploying towards assets, whether it’s your primary residence, the principal, or other investments. So, in 15 years, if you just keep up what you’re doing, you’re going to accumulate 1.5 million if you get a 0% return on all that.
So, I think you will clearly do at least a little better than that with any of the approaches we outlined in this. So, I think you will not have to worry about a 15-year time horizon. I think it’s about how do I back into what is that optimal space here and now three years, five years, seven years and all that kind of stuff and what’s the earliest future optimal state I can get to, I guess, with that?

Laurin:
Yes.

Mindy:
I really think we covered a lot.

Scott:
Yeah, I think so. Thank you for sharing all of this with us. I think it’s another interesting, really awesome perspective with this. So, we appreciate it.

Laurin:
Oh, thank you. It’s a true pleasure and honor.

Mindy:
This was a lot of fun, Laurin. Thank you so much. You really made me think about a lot of different things. I love it. I love it a lot.
Okay. That was Laurin. And Scott, before we hear from you, I have to say we did not do enough during the recording of this episode to praise her for where she’s at today. We did it after we stopped recording. I was like, “Oh, my goodness. You did such a great job.” We didn’t really focus on that. She’s doing really fantastically. She’s got approximately $500,000 in net worth outside of her home’s value, her home equity.

Scott:
Yeah. She’s a millionaire.

Mindy:
And she has low expenses outside of that home payment, which we discussed ad nauseam just in the last hour, but she’s doing really, really well. And I want everybody to know that we didn’t forget that. We just forgot to say it during the recording. But yeah, she’s doing awesome. She’s going to be sitting so pretty.

Scott:
Yeah. And that’s probably partly my fault as well with this because I just hunt for the problems and go right for it all the time and often forget to stop and smell the roses with it. But I completely agree that she’s doing everything right and it’s perfect. She just has major capital allocation. There’s four levers to personal finance. I said this a million times, but you can spend less, earn more, invest, or create. And in her situation, because of her ridiculously high income and low expenses outside of her home payment, it’s really, I think a capital allocation game for her at this point. And that’s what’s going to make the big difference for her is what she invests in, how she does it, and what her structure is with that.
And so we discussed the two major options, the two divergent paths here are pay off that mortgage and contribute to the 401(k) or build up after-tax liquidity and do the other things.
And all day long, I, Scott Trench, will be doing the latter of those two in the initial stages until I get that passive income threshold that I’m trying to get to as early as I can. And then, I go back and do the 401(k) and begin de-leveraging from those positions to make myself more comfortable with those types of things. But her choice is to do it the opposite way and that’s perfectly fine. It’s just, she’s going to be working towards that for a few years without really driving lots of liquidity into her personal life with that. But then she’ll have an event, again, when her house is paid off and be done and it will be wonderful.
So, there’s no right or wrong answer. That’s the major strategic pivot from there. And then, there’s a number of tips and tricks downstream to eke out a little extra turn with the 401(k)s and the HSAs and the Roth conversion ladder and all that kind of good stuff that we got into.

Mindy:
Yeah. Something she said makes me think that I need to invite our listeners to join our Facebook group so you can bounce ideas off of each other and have somebody else who gets what you’re talking about to look at your situation or your specific issue that you’re having a problem with and really review it and give you different options like, “Hey, here’s it from my point of view. Here’s my suggestion from my point of view.” Scott is … How old are you? 30?

Scott:
Yep. I turned 31 next month.

Mindy:
I’m 48. Scott will be 31 next month and I will be 49 in two months. So, we’re coming from very different points of view. Scott’s the CEO and I’m not, and that’s okay. Good for Scott. And I would never want your job, Scott. That looks like it would suck, but you love it so that’s great. So there’s just very different points of view that we’re coming from, but we know that you also have different points of view.
So, we have a Facebook group where you can talk about this stuff with fellow money nerds and frugal weirdos. So, please jump in at facebook.com/groups/bpmoney and share your advice, share your point of view, or ask a question because we’re all here to just get through this together.

Scott:
Absolutely.

Mindy:
Should we get out of here, Scott?

Scott:
Let’s do it.

Mindy:
From episode 224 of the BiggerPockets Money Podcast, he is Scott Trench and I am Mindy Jensen saying, “Parting is such sweet sorrow, that I shall say good night till it be morrow.”