Transcripts Including Tag: 2ndgenfi

Description: Tax Optimization :: Roth IRA for minors

These are the transcripts that include the tag 2ndgenfi.

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047R: The Rule of 72 Jonathan Mendonsa Another second generation fi conversation. Absolutely perfect. Well let's going to take a few minutes and talk about this past week's episode with millennial revolution Bryce and Christie man they just brought it. What an awesome episode right.
048R: The Roadmap to FI Jonathan Mendonsa Yeah we realized that 21 the pillars of FI. While it will get you to FI if you do that you will hit FI decades ahead of your peers. But it's not enough for some people they got to go back to that source. And we actually have created an essential listening list. Wow that's difficult to say. Let me try that again. We actually have created an essential listening list which we have put in our vault. I don't know if you are aware of this but to our audience we have actually created a crowdsourced vault to put all of our spreadsheets recipes tools video tutorials and it's kind of growing over time. Master budget files inside of this vault and it's both resources that Brad and I have developed but also our community has shared with us build on their own and they wanted other people to be able to access it. This was just an easy way for us to give you access to this digital locker where you could get these anytime you wanted and we put a file on there called the essential listening guide. And in that Bradon I took some time to think through how would we recommend you know obviously we tried to have this content build on itself but there is an organic flow to this that looking back we have an order that we think these episodes should be tackled. And while we would love for you just to start with us now and go with us into the future we think there's incredible value from following that thought progression and it will allow you to have a much more well-rounded perception of this community so there's two aspects to Paul's question one is how can I get my kids that are already doing decently well to latch on to the fact that they can be doing so much better and there's so much that they don't know that they don't know and I have some clarity on that. That unfortunately is due to experiences I've had in my personal life and that is to some degree you giving someone information directly one on one isn't enough. When I have had these conversations with just an individual that I think will benefit from this outside of the Choose F-I outside of maybe the online connections outside of somebody finding us and talking to us about it when I just personally 101 go and try to have a conversation with somebody about it. I rarely see that light bulb moment right then and there and I wish I could tell you otherwise but obviously I've thought about this stuff a lot. I've polished the message. But even with that in mind when I try to do this one on one it just doesn't work as well. But what does work is when they've been primed for it to a degree or they stumble on it on their own because May maybe a seed that someone else has planted. That's the value of the FI community and also what Brad and I have spent so much time curating and trying to build. If you have someone that's primed and receptive to the information it may not work coming directly from you but if you can point to it and then they feel like they've stumbled on it on their own. The floodgates come wide open and that's why we just wanted to build a couple of these ultimate guides that you could reference someone to say you don't have to be the one to give them the elevator pitch you don't have to sell them on it. The heavy lifting has been done for you. You just have to plant the seed and then point them in the right direction. So definitely go check out the guide that's in the vault just go to choose F-I Dotcom's slash vault access is totally free and will always be totally free. But once you pull up that guide in my mind there's about 20 or so episodes that are listed but I just want to give you the first there and talk you through why I think it's so important to start with those. The first one is the why of FI we just mentioned that that is the basis for everything you need to understand why behind that is the pillars of FI. These are the most accessible levers that if you do even a few of these you will literally retired decades ahead of your peers. Both of those are very powerful and it's hard to ignore them. So if you're willing to get through those two episodes I have a few more right behind it that I think we should consider as well. Another one is episode 29. This is one that I didn't think was going to be quite as powerful as it was and there was this idea of the aspiring minimalist versus the reluctant frugalist. And it was this idea that while yes many people are predisposed to fi because maybe they're engineers they're math friendly they're accountants. Other people want to win. And ultimately if you understand someone's internal motivation and you cater to that and you build a story around it people can end up at the same result. Even though they're coming from wildly different places. The next one was Episode 19. And this is JL Collins his is index fund investing. His articles on the stock series were the single biggest light bulb moment for me with regard to investing. And we were borderline obsessed with index investing just because it allows us to have a set it and forget it approach to our investment strategies and what we find over and over again is that people get burned because they try to do something too complex which then relies on their emotion to carry them over their investment years. And usually whenever you're relying on your emotion and how you feel things go south this takes all of that out of the way and it builds a baseline that you can build off of. I don't think certainly there are other ways to invest certainly real estate is a viable option for many people certainly there are people that have figured out other ways to do it. But I think as a cornerstone of your investment strategy both of us strongly believe that episode 19 is where you should start. And then right behind that we talked about it even further in the roundup which was 19 R right behind that is travel rewards. The reason this is included so highly is that I think many times people will associate frugality with not being able to do stuff. And what we find over and over again is that our community is able to live way more exciting lives than people that are just tied to the hamster wheel because one they've reclaimed their time and two they've figured out how to do things that are prohibitively expensive for other people for a fraction of the cost. So I mean just those five episodes right there will hopefully just grab your attention and keep you on board. And many times after you've gone to just a few of these you realize oh wow maybe I should just go back to the beginning and listen to everything because I'm getting something out of each of these. But certainly these are ones that in my mind even to start here and then I'm very quickly just going to mention a few others in case people are taking notes. Episode 24 the milestones of FI lets you know that yes while there is a beginning and maybe the beginning is being just broke finally getting out of debt and being broke. In the end to financial independence. There is a continuum that is worth documenting and sharing. And then the Round-Up that went with that 24 R talked about all the checkpoints of fi and it's this idea that you're continually getting more power on your side of the equation the longer you're able to create space between your income and your expenses and you use that space to buy your freedom and then episode 16 second generation fire talking about the value of not just focusing on this for yourself but for your kids episode 30 the side hustle with Alan Donegan talking about this idea of multiple income streams episode 33 design your future with Dominic Quartuccio talking about designing a lifestyle in your immediate future that you can actually get excited about and then episode 28 the order of operations. There's many other episodes that are on this list that and obviously I'm biased but I think you should listen to every single episode that we've put together. There was a reason that we found time to do it. I think you'll be encourage to think it's a good use of your time but go check out that essential listening guide. Those are ten episodes right there that are can't miss episodes. And I think will will hopefully be enough of a hook to allow them to decide to explore this further.
049R: FI Festival Brad Barrett Yeah Jonathan and speaking of a having things grow and be just kind of spit balling here and just telling everyone our thought process. My big aha moment at Fin con was actually about J.D. Roth which is interesting. We spoke with him recently on the podcast and and you and I were trying to figure out like what makes a successful podcast or blog and and we've come to the conclusion it's it's the story that's where people connect with it's not. Here are the 27 things that can save you money next month type you know list article. Those are valuable to some degree I suppose but that's not what gets people coming back to podcasts like ours or a blog like get rich slowly back in the day when when J.D. was at the helm. Right. Like people come for the story they come for that connection and it got me thinking that there are so many people out there in our audience who would love to tell their stories and they don't have the audience. They don't have the ability to do so. They don't have the technical know how to start up a website and and find an audience and put in all that time to make that happen. Well when I came to that conclusion was Jonathan you and I know our strengths and weaknesses. And one of our weaknesses is we don't love to write articles. We both kind of joke about that behind the scenes. We'd love podcast thing I could do this all day everyday but writing articles are just it's difficult. That's not the way that I like to express myself. But there are many people out there who are just brilliant writers and that is their means of self-expression. And what if we could get people from various different aspects of the FI community the FI journey to tell their stories. But do it on the Choose FI website not as just an errant guest post here or there but as an actual contributor to choose FI. So they would have a carved out spot of the Choose the Web site just for them and their audience. So we're bringing our audience in. We're hopefully having five to 10 of these people from our community become what essentially our Choose FI bloggers and it'll be like a rising tide lifts all boats type scenario where everybody's community feeds off of each other. If you have 10 bloggers you have nine other bloggers bringing in people to choose of-I to read content and new people can come across your content like it's just such a wonderful virtuous circle that I just am so passionate about this I think this can be wonderful because each of us want to find that person we resonate with. I've been so struck with that when we get emails from a particular podcast episodes that we've done that's just oh I'd love that guest you had on it just that was exactly like my life. And that episode out of the 70 you've had just really hit home with me. And now they've listened to the other 60 odd episodes but yet it was just that one without one person they had a connection with. And that was just one of those lightbulb moments for me that I like. People really are looking for that connection. So we could get someone who's 55 and just found FI and is taking steps to make it happen someone who someone who's 18 and is looking to be that second generation fire. We can have someone in a high cost of living area someone in a low cost of living or just anything right like you can have these stories. So anyway long story short here we would love to find people who want to tell their stories. So if that sounds like you let us know just reach out to us have feedback at Choose FI dot com and tell us you want to write for choose FI that sounds like something you are passionate about and you could get behind. Again not as just a random guest post but it actually being your site you can write as little or as much as you want but we want you to be passionate about it. And I mean that's just something again that Jonathan and I brainstormed at fincon and I think can be a real game changer for the Choose community because it's not just a podcast it's the podcast it's the Facebook group and now local groups and it can be this incredible set of stories at the Web site.
050R: Impact Phil - (voicemail contributor) Hi guys I'm 29 years old and I've been in the Marine Corps for 11 years. I did my first 10 years in the infantry and was fortunate enough to do several combat deployments with some of the finest men this country has to offer in that first 10 years really took its toll on me physically and mentally. But I kept my head down and I've made a career out of it. My wife and I have been together for over 10 years and are fortunate that we were naturally frugal people. My wife does like to do some occasional shopping. And we have done much international travel when I'm not deployed or training. Well about a year and a half ago I got selected for an officer program which came with more opportunity and a generous pay increase as I don't like stuff. And my wife is pretty frugal by nature. We wondered what we should do. Well after bouncing around financial podcast forums I stumbled upon ChooseFI. I listened to a few podcasts and I was absolutely hooked. I thought this is it. This is what I've been looking for. I pictured my life in nine years when I can truly retire and not start a second career as most military retirees do. I felt this rush I felt rejuvenated and I have slowly but surely got my wife on board with the frugal lifestyle. Now comes our plan for fire. We have come in contact with some very interesting people from the art and rock climbing communities as we live 5 minutes from Joshua Tree National Park and they have absolutely inspired us. My wife and I hike mountain bike backpack and are just now picking up rock climbing. So in nine years at the ripe old age of 38 I will fully retire with a military pension since we have been and will continue to save 40 to 60 percent of our income. My wife and I would never again work a job that we don't want to. We plan to buy an old FedEx van renovated to accommodate us plus a cat and travel all over the country climbing and exploring. We will periodically park the van at a friend or relative's house and live for months at a time in places like Thailand London Argentina or wherever catches our fancy. The possibilities feel endless. I have a zest for life again. I find myself excited to go to work as each day is a step closer to our dream even upcoming deployments don't seem so bad as the opportunity to put more tax free money into our index fund and ultimately toward our financial and personal independence. I try to share this lifestyle with as many military members as I can as most of them struggle and live paycheck to paycheck. I hope that I can make a positive impact on this community that I work and live in as many of them struggle with their own financial independence. I will continue to counsel as many as I can. I will also stay tuned to choose FI to get more tips and live hacks to bring more joy into our lives and the lives of others. Thank you so much for what you guys are doing and please keep up the great work. Take care.
051R: BeCoachable Jonathan Mendonsa Love it guys super quick update about the Choose FI local. First of all those are blowing up most of the groups have well over 30 people in them some of the groups with higher concentration areas have more than 100 people in them. The power of these local groups is this idea of community and they're going to continue to add more and more value 1. Once you join it and to once we figure out what's working how to best add value to the local community. And so a lot of the ideas that Brad and I were spit balling back and forth. Our community really has already developed and taken to the next level. And so those ideas are being shared on the local groups. If you're interested in joining one of those local groups just go to choose FI dot com slash local it will give you a list of all the groups that are active to date. If you don't see one that fits your specific location or you would like to start or admin one just tag or message Brad or myself on our Facebook group if you want to join the facebook group. There's over 6000 people in that group. Now it's probably closer to 7000 by the time this airs. You can just go to chooseFI dot com slash Facebook to join the group. We would love to include you in the conversation and help you find a local community. This. I mean this is very exciting and I think it's the fact that there's an infrastructure in place already there's a level of consistency that's going to make these so valuable going into 2018. So anyways to everybody that's already participating in one of those groups are awesome because you're there. Thanks for joining us this give me a lot of fun. The other thing I want to mention is we talked to you about Camp FI many times. There's two of them in Florida. There's one in Virginia. Next year there's probably going to be one in the Midwest and we'll probably see some in California. These groups are what make those camps possible. That's going to add infrastructure in place so we can quickly get those things up and running for you to give you a larger venue and then we also talked about the idea of doing a FI festival. These groups will very likely make a FI festival a possibility where we can get potentially hundreds of us from all across the country together for local a larger event. So it's exciting to see this thing grow it's exciting to see how much enthusiasm there is in this idea and you could see I can already see once the light bulb goes off and you realize the possibilities of having a tribe of people in your own local community. How much value that adds. We're getting messages literally 20 messages a day about how can we get involved. How can we get one of these started. So thank you for reaching out to us that feedback is invaluable and we're going to keep making this better. All right. So I want to go and dip in the mailbag. We have a couple of voicemails that we want to play today and this first one started out as a question from Lori and she says I have a question about educational IRAs. We have three kids ages 13 14 18 our son just started freshman year today at Florida State University. My parents started educational IRAs with a financial adviser for each of them when they were born putting 600 to 800 dollars a year in each. I have just now discovered FI your podcast and all the talk of VTSAX can the IRAs be put in an index fund. I'm so confused. The son has nineteen thousand dollars. One daughter has seventeen thousand dollars and the last daughter has sixteen thousand dollars. P.S. Our son did part time dual enrollment. He took AP classes as junior and senior year. He's going into college with 22 credits. We also have a program in Florida called Bright Futures. If you score at or above 29 on your ACT or 12 90 on your S.A.T. as well as get at or above a three point five GPA you will get 100 percent of your tuition. Now that's tuition only not room and board covered at a state school. Something to shoot for. For second generation fires. So Laurie thank you for that extra information and asked your question. We sent this over to the millionaire educator and he has gotten back to us with a response and yet we're going to go and play that. And also I should clarify that with the dollar amounts that she mentioned I did check with her that money is in an ESA.
052R: Bring It Brad Barrett Yeah I love that say I a moment speechless. I don't really have anything to respond other than that is exactly what we've been talking about here on the podcast for an entire year is having these options implementing them figuring out what the path is for you for your family. Second generation FI I mean it covers everything. So thank you for the amazing voicemail.
063: Scott Trench Brad Barrett Scott I'm struck by by this you latch onto this so early right. It was just a couple of months out of college that you found Mr. Money Mustache realized that your initial job while sure making great salary this this was not a long term goal for you. We're constantly talking about second generation fire here you know and how do we get these people who are who are young who haven't made quote unquote bad decisions about housing or cars or whatever it may be how do we get them onboard with fi when they don't even understand what a financial life is like or what the. I don't know almost like a horror show of having to work for 45 or 50 years at a job without ever taking more than a week of vacation at a time that's kind of hard to explain to someone. But I'm curious if you've ever sat back and thought how do I reach those people. What's the best message you. Have you reflected on that. Have you tried different messaging. Is there anything that gets through better to 22 23 year old kids in your experience.
074: Ryan Carson Brad Barrett Yeah I hear you Jonathan. It definitely was an eye opener for me too. I think like you. College is the thing that vexes me the most for the fi community per second generation fire from my own family. I mean I have a 4th grader and these years fly by really quickly. We're talking eight years from now she's going to be heading off to college and that scares the heck out of me. I mean it is a huge financial burden for something that I'm not sure what kind of value it has dubious value at best. Like I said in the episode we've literally just had this conversation Laura and I about what is a college degree worth what does it look like. What is this going to look like for our kids. And it really does scare me. But knowing that there are companies like treehouse out there they may be one of the first but I assure you they won't be the last. And that's what's cool about this. This is while this is an amazing thing for people who are looking for coding jobs. For me it's more like the paradigm shifts and that's what I always want to bring to this podcast is larger issues right. So the larger issue is from our perspective. College is broken and it's absurdly expensive. As Ryan said there's this ridiculous opportunity costs of years of your life and potentially a quarter of a million dollars plus debt that you're paying off for years to come. So that's the problem. And how do we fix that. How do we get people jobs without taking years and going into debt. And a solution like this is a really brilliant one and it teaches you skills that you can stack on top of each other so. So I love the paradigm shift. That's the big takeaway for me.
074: Ryan Carson Brad Barrett Yeah I really love this episode. It was an eye opener. It was a paradigm shifting episode where we know in the FI community that there are potential issues with the expense of college the opportunity costs of spending four years of your life there and coming out with potentially No Job or no real discernible skills to get a job. That is a major issue for second generation fire. So we went out and were lucky to get in touch with Ryan Carson and this work that they're doing at treehouse is they are looking at coding computer coding as a trade job and it's something that doesn't need a four year degree. It means skills that you can prove that you have accumulated right and then you stack them on top of each other and you have a base for a computer coding career going forward that you can literally prove to your potential companies that hey I can do this here's my portfolio in essence and that's really neat to me. And the beautiful part is they've taken this and cut off 98 percent of the cost of a college degree and they've really changed the game. They've made it so. Hey the proof is in the pudding. Sign up for this. You're only going to pay like twenty five dollars a month and you're going to learn and we're going to show you that this is legitimate that our graduates have gone on to significant coding jobs making 50 some odd thousand dollars right out of the gate from just getting these skills and to me again that is just such a cool way to look at a problem which is the expense and the time for college and actually doing something about it.
074: Ryan Carson Jonathan Mendonsa That's awesome. Yeah we were constantly again it's this second generation fire. That's the term we've coined here which is people Jonathan and I and people our age are kind of first generation in this fied community financial independence. And we're trying it to lay the groundwork for this second generation. And sounds like like an idea like this online learning treehouse in particular. It just is brilliant because as you said I've heard you say before you guys cut out something like 98 percent of the cost of college and you're giving people skills that they can walk into a job and walk into these apprenticeships and get rolling immediately.
074: Ryan Carson Jonathan Mendonsa Onward. All right. Brad. This was it. Man this is the missing piece of the puzzle. You know I think it's so easy to complain about the state of economy, to complain about where jobs are going, to complain about just how difficult life seems. But I think so many of us get stuck in this. Identifying the problem but not going out of our way to look for solutions and the FI community more so than any other community that I've met has had this eternally optimistic perspective of how do we solve the problem. And in my mind the second generation FI problem is the one that I've had the most trouble with is that college is broken and if you can solve that first step you go back to the episode that we have a Scott trench talking about that first piece is getting the fifty thousand dollar job. Everything gets easier once you can get to there. This episode solves that in my mind definitively.
078: Travis Hornsby Jonathan Mendonsa This is really remarkable. I want to highlight the contrast here I think it's important that it'll help us as we transition. You graduated school with no debt and even more than that. Because my understanding is because your scholarship paid in excess of what you needed to live you actually graduated with a positive net worth and then you did not have a six figure income but you had a good maybe above the median average you saved a significant period and with the tailwind of the market behind you you were able to get your net worth all the way up to two hundred thirty thousand dollars so at the age of 25 you basically have a two hundred thirty thousand dollar net worth and you make this lifestyle design choice which is incredible. And what's really fascinating about this is in contrast the people that you're serving which is frankly it's me you know I graduated school and I came out with negative six figures of student loan debt. I have a massive massive uphill battle to just get back to broke and the population that you're serving is in total contrast to the lifestyle choice that you made. What's fascinating about that is that influencers that are putting out information writing good content coming up with different podcasts. A lot of it tends to be inherently selfish. It tends to be information that serves you where you are. It's why up to this point we haven't seen a lot of information about second generation fire because a lot of the early adopters of these concepts that were writing did not have kids that were needing that information at that point in time. But you have made the opposite choice. My question is what we're about to dive into all of the ideas involving how to help someone that six figures in student loan debt. None of the information that we've covered up to this point helps that person. What made you decide to dedicate your life to helping this particular segment of the population.
078R: College Hacking Toolbox Brad Barrett Yeah totally agree. Jonathan just one other kind of interesting thing that's going on in my life. We love to talk about second generation fire. Right. So I think getting my kids involved in financial literacy and just being aware of where their money is what's saving actually means is really important to our family. So I mentioned previously that what we do with their weekly allowance is that they have three buckets and their actual tangible buckets. OK. So one is saving. One is spending and one is charity. I think it's 50 percent goes to saving and then I think it's 25 25 goes to spending and charity. So it really sets the tone that saving is essential. But also charity is really important as well. And of course you need to spend. So I think it's kind of a good structure by the girls over the last. I'm not sure x number of months or a year or whatever. They've they've saved up a decent bit of money and they have this big wad of cash basically in each of their savings targets so it was the day this past Saturday that we decided to actually go down to our local Wells Fargo branch and deposit the money. And it was it was really a fun experience. I mean we went as a family the four of us waltz in on a Saturday and this is odd but I go into that branch somewhat often so the people know know us there and they welcome the girls with open arms. It was just like this fun experience. The girls got to hand over this big wad of cash. And like say specifically it's 151 dollars and 20 cents for for Molly and I think and deposit it like 337. Of course of course she did. She actually she was amazing. She asked us if it would be ok if she took money out of her spending bucket to put into her savings to put into the bank. How long did I have to think about that. Oh about a nanosecond. And yeah that went over perfectly.
078R: College Hacking Toolbox Brad Barrett Yeah. And obviously you are a perfect case in point. I'm someone who had student loan debt. If you had found this message this message and choose FI. 10 years ago 15 years ago maybe you would be in a different position. So everyone makes life choices makes quote mistakes. If you even want to call it that I'm not sure you would necessarily. But yeah. It's just finding where you are today and making the right decisions going forward. That's where we like to highlight. Of course if it's a situation like second generation fire where you can help your children or their friends kids or whoever make better decisions before they get into that situation then all the better. But you have to deal with the situation as you see it today. And yeah let's talk about the different options.
078R: College Hacking Toolbox Brad Barrett Yeah and we definitely will. We'll keep everyone updated here. And I really think that Anna's interested in writing that second generation fire blog that you that you talked about I think it's something that that's getting her excited. So yeah we got to make that happen in the near future.
078R: College Hacking Toolbox Jonathan Mendonsa Congratulations to the family excited that Wells Fargo was able to participate with you in the second generation FI story.

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