r/TheMoneyGuy

Hi everyone,

So I just started listening to the Money Guy podcast last month, and I'm catching up through the back catalog of the last year. From what I can tell, the guys have referenced two different ways of calculating how you're doing at each decade in life at 40, 50, 60, and 65 years old -- the investment goals and the prodigious accumulator of wealth (PAW) of [(Age × Annual Income) ÷ 10] x 2

I'm a bit confused, however, because if you compare the investment goals vs the PAW, they don't seem to line up. At age 40 and 50, the investment goals considerably lag behind the PAW. But then at age 60 and 65, the PAW falls behind the investment goals.

        IG       PAW
Age 40: 3x    vs 8x
Age 50: 6.4x  vs 10x
Age 60: 13.7x vs 12x
Age 65: 20x   vs 13x

I fully admit, I'm still new, so maybe I'm just interpreting this wrong, but I'd love to see what you think. Thanks!

Edit 2: my husband and i have been working at our jobs for about 4 yrs now. We had hit a really rough patch before this. I had depression which almost ruined everything, and my husband had lost a job he had for over 20yrs. And because of my depression I could barley get out of bed let alone figure out how to go to work. So because of all that we blew through all the retirement we had and are now basically starting out brand new. Life has been rough. I think somethings are starting to change. Just not quickly enough.

Edit: the amount I shared is after taxes. It's the amount that I actually see in my bank account. I calculated my husbands a little lower because of the lowest amount I've seen him get paid, he fluctuates because he works 40 or more hours a week depending on what is going on. I can only work 40 hours a week. I get free health insurance through my job, they pay for it. Husband has to pay for his and our 2 younger kids but it is low cost as he works for the state. He has been with the state for about 4yrs. My job pays us through government grants and our raises are based on the COLA

So my husband and I ahve been married for just over 20 years. We both work full-time. We have decent jobs. We have 3 kids, 1 going into their sophomore year of college 1 going into their senior year of high-school and the youngest going into their first year of middle school. We own our home and our cars. We bring in about 62,000 a year, maybe a little more actually. And all the debt we owe, including our mortgage payment is about $80,000. I don't know what to do to get out of this struggle. I have been doing some delivery services to help make the ends meet basically on the daily. But I need something else, something more. What do I do? What's your story? Can anyone help me?

A lot of people are trying to delete their comments made from a year ago in 2 years ago when everyone was trying to call it a scam not too late soon it's going to make everyone who said that look like a bunch of fools

so is there a way trump or whoever is in charge to simply scale back the value of physical and digital american money since at the end of the day it is just a glorified trading system

Im in a predicament where by year end my wife and I will be below the $242k Roth IRA contribution limit. However, I have stock comp available that has ballooned up to $200k+ and I should likely sell some (it’s about 1/3 of my net worth so pretty substantial). However, if I sell then I will no longer be qualified to contribute to roth.

Both my wife and I have been contributing to our roths this year which makes things complicated as I have no idea how to “back out” those contributions (investing through fidelity).

Any advice would be greatly appreciated!

I am currently a 33 year old husband and father. My wife and I have 2 kids with 1 on the way! I am posting in here to get an understanding of how my finances are and a benchmark with opinions in this group. I am constantly battling with not knowing if I am in a solid situation and how can I set my family up for success.

I make anywhere from 200-350k a year in sales role 175k base plus commission -

Here is my snapshot:
133k in a high yield savings account - I use this as my home operating account.
1.1 million in investment and 401k account — have a financial advisor who controls this.
400k equity in my primary home
No student loans
$0 credit card debt
Stay at home wife
My expenses monthly are around 14k a month

I appreciate any feedback or strategy as I am looking to be really solid around my personal financial position and where am I with my age to ease my anxiety.

On step 7 of FOO. 29 M. Have a couple thousand in crypto like bitcoin and such. With the relatively stable action of crypto after the huge crash, it feels like I'm holding this is a money market or something along those lines. Is it worth to sell since I'm down and just invest elsewhere or worth it to hold?

32M, working in corporate as an HR assistant, have some money about 3L in EPF, about 1L (emergency fund) in a liquid fund. Also have debt, about 10.8L home loan and 1L auto loan. I am really scared because I know I have to get married soon and that will be expensive as well. How do I grow my corpus so I can be wealthy, or am I too late?

What were your thoughts on the financial advisor episode? I appreciated their fee transparency but think they may have over exaggerated the downsides of a flat-fee advisor. For example, a client with 2+ million invested could comfortably meet with the advisor monthly and still save money over the percentage-based advisor. Abound Wealth’s fees are high for percentage based advisors and they should be transparent that most clients won’t likely ever even interact with Brian or Bo.

My wife and I have approximately $500,000 in student-loan debt combined. We both work for nonprofit employers and are pursuing PSLF.

I’ve been an attending physician for about two years. During that time, I accumulated roughly $500,000 in taxable investments, partly through aggressive saving and options trading. If we paid off the loans today, we could essentially become debt-free, but we would be left with only our retirement accounts and perhaps $40,000 in cash.

I’m moving off SAVE, and our combined student-loan payments will be around $3,500 per month. The payments are recalculated annually based on income/AGI.

Mathematically, continuing with PSLF may leave us with more money. Psychologically, however, the income-based payments are affecting my decisions. I feel discouraged from picking up extra shifts, realizing investment gains, or doing anything else that increases AGI because the additional income is taxed at a high marginal rate and may also increase our future loan payments.

I’ve now simplified my investment strategy to low-cost index funds that I intend to hold long term. I enjoyed options trading, but the short-term gains created taxes and could raise our student-loan payments, making the strategy feel less worthwhile. Im also likely underperforming the market based off statistics.

Would it be unreasonable to liquidate approximately $500,000, account for any capital-gains taxes, and pay off all the loans for the psychological freedom—even if PSLF is probably the better mathematical decision?

Or should we keep the investments, make the required payments, maximize retirement contributions to reduce AGI, and stay the course with PSLF?

I’d especially appreciate input from anyone who faced a similar decision with a high income, a large loan balance, and enough invested assets to pay everything off. What numbers would you compare before deciding?

I'm 31 living in the Dallas area making 125k, have a long term GF, currently renting. While I feel like I have made good financial decisions so far I feel like I have also made a lot of dumb ones, specifically around wasting money on entertainment, gambling, food delivery, electronics I barely use, etc.

Although, I recognize I am probably doing better than many my age and I am grateful to be where I am, I just cant shake the feeling that I am not doing enough and falling behind, and have regrets for blowing a lot of money on useless things. every dollar that I've wasted on impulse spending haunts me because I know that money could have been invested and growing.

I find myself checking my finance apps on my phone multiple times a day and thinking and overall thinking about money every hour of the day to the point where it just seems unhealthy.

I grew up in a household that was very financially conservative, both my parents are retired with over a million dollars by just working their modest 9-5s and saving. They were always stressed about saving/not wasting money. I think this is why I hold so much anxiety about finances.

Net worth ~258k:

~98k roth ira - 90% VTI 10% VXUS

~59k 401k - 100% VTI

~40k brokerage - 50% VTI 50% VUG

~15k emergency fund

~ paid off honda civic worth 25k

~ Pokémon card collection worth 25k

How can I stop obsessing over money so much, move on from mistakes of the past, and dial in impulsive spending?

"we just crossed 1million, I feel nutin" is what people love to post.

I personally feel a huge difference as things grow.

My wife and I made a "fun" purchase that was about $2,000. I said, you can think of it as 2 days of work, or think of it as giving up 5.3 days of investment growth (7% assumption).

Mentally I love how I have a tailwind behind us now that our net worth is getting higher. I DO feel each milestone and feel extra comfortable with little expenses in life that in the past would have stressed me tf out.

Thank you money guy for your YouTube channel. I started following the FOO since I was in my early 20s and made it somewhere I’m proud of. But earlier this year I lost my main source of income. I thought I would have landed something by now but the job market is tough one. I get an interview here and there but no offers. Don’t skip your emergency fund guys it comes in clutch.

In the next few months I'll finish paying off my high interest debt, so I've started thinking about what I'm gonna do next. I'm 42 and have a teeny tiny retirement (~13k) from a few years of 3% match. Once the debt is paid we'll have about $4500 discretionary income per month. It's my mom and me. I've taken care of her since I was 15, so we will stay together until she passes (she is 80). Could be soon, could be 20 years. The doctor thinks she's healthy.

I am worried about affording the home after she passes, so I am calculating everything based on mortgage + insurance + small repairs being less than $2500/month. For that, in my area I'll need >$250k down in order to lower the monthly outlay enough. If I buckle down and put all $4500 toward a down payment, it'll take 5-6 years to save the minimum. If I put the $24.5k and $7.5k per year toward my 401k and ROTH IRA, it'll take 12 years or more.

I understand I need enough in my retirement, but at the same time having a relatively small mortgage reduces the burden on my retirement. Also, I would love to pay off my house eventually. Owning a home free and clear is more enticing to me than playing interest rate arbitrage, so as a bonus having no rent or house payment makes a big difference in retirement.

We have been extremely poor our whole lives up until a few years ago. We've always had to deal with nasty landlords and we're tired of it. I don't know if I can wait any longer (mentally), so I really don't want to put all that money in my 401k and ROTH IRA.

Thoughts?

I’m 23, single, making $92,000 and living at home with virtually no expenses. I have $65,000 in a Roth IRA, $1,500 in a Roth 401K, and $50,000 in an S&P 500 brokerage.

I can invest about $55,000 and plan to retire around 50. I’m going to max my Roth IRA and HSA each year and I’ll likely use ACA insurance from 50–65, so controlling MAGI in early retirement matters.

How would you split the remaining money between Traditional 401K, Roth 401K, and taxable brokerage? How would you divide the savings between the 3?

We (33/34) are getting ready to buy a new car and I have a particular amount in mind that I want to spend. My wife has a much higher amount in mind, so I'm wondering what you would spend in our situation. We will be paying cash and plan to keep the car long term. Our cash balance is high because it includes this purchase plus our general emergency fund.

HHI: 320K

No debt

$1.3M net worth ($700K house, $450K retirement, $150K cash)

I often find myself worried about small amounts of money. I feel like I constantly need to optimize money like restaurant rewards, credit card rewards whether I can get that extra 1% back, cooking from home to save money, not wasting gas on multiple trips, warranties and return policies. I have a finance degree so it makes sense for me to think about money a lot.

Trying to follow a financial plan or budget is hard to follow rigidly because it is no fun. However I feel guilty whenever I spend money, it kills the fun when I go out with friends.

I am doing well financially but I grew up middle class and only had one working parent who survived 8 layoffs. I am in my mid 20s and I already have been laid off once, didn’t get a return offer for my internship, but after my last layoff I actually got promoted so I now take home about $6k a month. And I have cheap rent because I have roommates which is $500 a month. I invest the rest of my money in my ROTH IRA and ROTH 401k or put it towards saving for a house. I have over $200k between investments and savings.

Do I just remind myself that having an optimal strategy is best and setting my mind to my work, relationships, and health is more important? As long as it’s excellent (no credit card debt, home mortgage / car loan only) and reasonable? I can’t live my 20s and not enjoy some of my money and hoard it until retirement but I also need to not try to be a perfectionist about the micro decisions that suck my time. I can also live with some uncertainty and not try and control everything.