There is magic in the side hustle. If you're on the path to FI like most of us are, and you're not already making six figures with three rental properties
Dr. James Dahle, founder of The White Coat Investor, talks about getting his start as a doctor and a blogger, setting up inheritance funds for his children, thinking through his investing strategies, and the motivation that keeps him working on the White Coat Investor.
- Dr. Dahle describes his childhood in Alaska, and his early financial influences.
- Why did Dahle’s father encourage him to go to medical school?
- Dr. Dahle finished his undergraduate degree with only $5,000 student debt, and joined the military to cover the cost of his medical degree in exchange for 4 years of military service.
- Choosing a college based on buildings and trees may not be as important as that value you’ll get compared to the price you’re paying.
- Dr. Dahle has decided to give his children their “inheritance” in their early adult life.
- Roth IRA
- College fund in a 529
- “Twenties Fund” in a UTMA account
- Best possible tax deduction you can get is to hire your children to work in your business, as you don’t have to pay any payroll taxes and it is a deduction for the business.
- Did Dr. Dahle always have a frugal mindset?
- Dr. Dahle’s frustrating experience with real estate and life insurance professionals ultimately motivated him to learn more about financial management.
- What does Dr. Dahle think of mutual funds, and the different types of them?
- Highlights of establishing a personal investing policy statement:
- Set your goals
- Decide on your asset allocation
- Select your investment
- How does location impact a doctor’s potential income?
- The White Coat Investor (WCI) includes detailed information about the Backdoor Roth IRA and has been instrumental in marketing this investment tool.
- During the early years of the WCI website, what kept Dr. Dahle motivated to keep producing content despite low returns?
- Dr. Dahle’s wife is officially a 50% owner of the WCI
- Opens up a new 401k
- Gives her access to social security, although now the business has to pay into that.
- Does Dr. Dahle use an accountant at this point?
- As the WCI has grown, Dr. Dahle has outsourced a number of responsibilities.
- Why did Dr. Dahle turn down an offer to purchase his business?
‘The Psychology of Money’ – Morgan Housel
An in-depth conversation with JL Collins about a recent controversial interview given by Suze Orman, and clarification of what concepts are truly at the heart of the financial independence movement.
- Frugal wins of the week from Brad & Jonathan: garbage pickup and cell phone batteries.
- What questions did Dominick Q, from Monday’s episode, ask that were most impactful for Jonathan?
- Jonathan explains how he uses a planner at night to set himself up for success the next day.
- What three things does he want to accomplish tomorrow?
- Shutting off notifications on his phone allows Brad to step away from him phone more effectively.
- One of Dominick’s strategies for breaking the tie to various technology is a ‘digital detox’.
- Leaving his phone at home during a family walk each morning helps Jonathan give quality, undivided attention to his family.
- JL Collins, a.k.a., the Godfather of FI, talks about two recent interviews on the “Afford Anything” podcast with Suze Orman (personal finance expert and former CNBC talk show host).
- Although Suze opposes the overall idea of FIRE, she advocates for many similar personal finance concepts and principles.
- Brad and Jonathan wonder whether anyone would ever be able to retire based on the FI numbers that Suze suggested.
- JL suggests that fear of what might happen in the future informs Suze’s mindset more than necessary.
- Continuing to work doesn’t mitigate uncertainty about the future.
- The only truly non-renewable resource is wasting decades of your life.
- Is the FI community more prepared than most for bad things that might happen in the future?
- Jonathan and JL wonder if Suze’s wealth has been accumulated through sound investing, or from a variety of businesses and her work as a TV personality.
- It’s easy to sell books and products based on fear.
- Was Suze’s interview actually good for the FI community?
- The amount of money someone actually needs to retire is entirely dependent on the lifestyle that someone chooses to live.
- Does the “FIRE” acronym add some concern and confusion about the FI community?
- Being financially independent just means that you can do whatever you want.
- Trying to pick individual stocks is a loser’s game.
Interested in More from JL Collins
Check out his incredible stock series at JLCollinsNH.com
We also have a 3 part podcast series with JL Collins
- Episode 19 | The Stock Series Part 1
- Episode 34 | The Stock Series Part 2
- Episode 36 | The Stock Series Part 3
JLCollins also did a fantastic talk with Google which you can watch here
The Simple Path to Wealth – JL Collins
Dominick Quartuccio defines life ‘drift’, advises Brad & Jonathan on how to take inventory of their habits, and evaluates the role technology plays in helping or hindering progress toward our goals.
- Best place to start is Episode 33
- What is “drift”?
- Who is Napoleon Hill, and how did it impact Dominick?
- How in control of your life are you really?
- How does Dominick evaluate his own habits to evaluate which habits need to be adjusted?
- How can you be busy and lazy at the same time?
- The hustle and the grind are always a part of getting started, but it shouldn’t last forever.
- How can someone start to evaluate their habits?
- Where are you resentful?
- Where are you acting out of obligation?
- How does someone actually inventory this?
- Why is technology one of the biggest causes of drift?
- What is the antidote to drift?
- Define what role we want technology to play in your life. Is it actually serving that role, or sabotaging it?
- How does technology addiction impact our lives?
- What can we do, and can we realize when this is happening to us?
- First step is understanding how much time you’re spending on your phone doing what activities.
- How can someone overcome the rush that comes from receiving notifications from the phone?
- How important are the first hour and last hour of the day?
- What is the first hour of Dom’s day committed to?
- How does being in the ‘optimal state’ help Dom accomplish the things he wants to accomplish in his life?
- What does Dom include in the last hour of his day?
- Prepare yourself the night before for what tomorrow will look like.
- The more decisions you have to make in the morning, the more likely you are to slide into drift.
Brad and Jonathan get an update about the “Playing with FIRE” documentary, they recap FinCon 2018, and review feedback from the community about Monday’s episode with the Military Dollar.
- Brad and Jonathan just returned from FinCon in Orlando, Fl.
- The meet up during FinCon was a huge success.
- ChooseFI won the “Best Personal Finance/Retire Early Blog or Podcast” at the conference.
- Potentially as much as 20% of ChooseFI’s community are service members.
- Avoiding a deprivation mindset and instead focusing on how great life will be when you open up your options through Fi.
- Email from David: Military Dollar did an excellent job explaining the complexities of military benefits in an accessible way.
- Feedback from Rick: Excited about the resources that are currently available to members of the military, as they are new compared to what resources were available previously.
- The Blended Retirement option is dramatically improving the retirement benefits for the huge percentage of service members who don’t make it to full military retirement.
- Army Doc points out an extra advantage of using the Post 9/11 GI Bill for dependents: applying and being admitted to a school ‘early decision’ is a binding acceptance which can cause some people to worry about finances, particularly for private universities.
- The GI Bill, combined with solid advanced research about each universities’ participation in the Yellow Ribbon Program, can give your child the leg-up to getting into a university.
- Voicemail from Chris explaining the difference between being enlisted reserve v. officer.
- How have healthcare benefits have allowed Chris to pursue a small business and save money on health expenses?
- Travel through the marines has opened Chris’ worldview and helped him building international relationships.
- Stephen, talks about potential benefits of the Servicemen Civil Relief Act, which can provide some assistance with credit card, phone services, etc.
- The window to opt into the blended retirement system closes in December.
- Update from Scott, the creator of documentary “Playing with FIRE”
- How has the documentary project impacted Scott’s life?
- What impact has the crew had on Scott, and how has FI impacted the crew?
- What’s so compelling about the interviews from the documentary?
- What has been challenging so far?
- Call to Action from Brad & Jonathan: help get the documentary distributed and support the message.
The author of the Military Dollar joins Brad and Jonathan to discuss the various ways that service members can optimize their finances and choose financial independence, including retirement plans, financial planning, health care benefits and the GI Bill.
- Working in the military can set someone up to retire after 20 years with a pension and the ability to pursue whatever interests them.
- Why do many young members of the military actually have financial problems?
- Has Military Dollar ever seen any specific education for new servicemen?
- How could a young person change his/her mindset to make more frugal choices and pursue FI?
- Why did Military Dollar decide to pursue financial independence?
- How did she get started?
- What was MD’s savings rate early on?
- How has MD set herself up to potentially retire by 41?
- What was the moment that changed MD’s mindset and approach toward finances?
- How do most military members approach debt?
- What does the optimized path to FI look like in 2018.
- What’s the difference between the old Legacy Retirement and new Blended Retirement System?
- What advantages does the Blended Retirement System have for people who don’t stay in the military for 20 years or more?
- What is the biggest difference between the enlisted and the officer’s route to FI?
- How can people plan for and understand relatively predictable promotions and pay raises?
- If someone starts young and doesn’t increase their lifestyle spending, getting to a 50% savings rate is very possible.
- Within the military retirement system, what investment options are available?
- Active duty health care = free for you and your family.
- How does the GI Bill work, and how does that help with college expenses?
- The GI Bill can be passed onto family members, but does include a service commitment.
- If the GI Bill is used by a service member’s children, or after separating from the military, there is a housing allowance available.
- GI Bill will cover all tuition and fees as an in-state student for public universities.
- GI Bill will cover approximately $22k for private universities.
- What is the Yellow Ribbon program, and how does it help cover the difference?
- What is the minimum time of service to qualify for the GI Bill?
- What’s next for the MD whenever she retires from the military?
- How does MD balance her commitment to the military with her interest in serving her community?
- How will MD know when it’s time to retire?
How and Why I Sold Get Rich Slowly – JD Roth
The logistics of estimating and paying taxes as an entrepreneur, Brad’s frugal win of the week, and emails from the ChooseFI community.
- Brad and Jonathan are at FinCon in Orlando, Fl.
- Brad describes his family’s frugal win of the week at Old Navy.
- Review of the tax implications of winning a non-cash prize.
- How do some entrepreneurs put themselves in a position to fail because of taxes?
- Case study: how to make estimated tax payments as a new entrepreneur.
- Brad wants to pay the least amount of money in taxes, but ensure that he definitely pays the minimum amount to avoid incurring penalties.
- Knowing due dates and technicalities is important.
- It’s key to have money set aside in case you do owe more at the end of the year.
- What is the safe harbor provision?
- If you have blended W2 and non-W2 incomes, you do have to estimate based on previous pay stubs.
- Why would someone owe payroll tax?
- Brad uses a different bank account to reserve money he thinks he’ll need for taxes, and uses an eftps.gov account to submit his taxes.
- It’s important to know that you’ll owe a lot of money on April 15 every year.
- Email from Ally reporting two life wins:
- Keeping an inventory for what’s in her freezer by writing on the front like a white board.
- Using checkboxes to keep track of the three things she accomplishes every day.
- Is FI getting to the UK?
- Playing with FIRE documentary has been submitted the film to Sundance.
- Scott, writes an email, to explain how pursuing financial independence and information from ChooseFI has changed his life.
Mr. and Mrs. Waffles on Wednesday (WoW) talk about winning on a TV game show, starting their own business, learning the tax code to maximize 401K contributions, and volunteering internationally.
- How did Mr WOW win on the Price is Right, and what did he win?
- What were the tax implications of his winning?
- How was Mr Wow's experience at the IRS building in Los Angeles?
- Why did Jonathan receive a tax penalty last year, and how did he respond?
- How did Mr. and Mrs. Waffles on Wednesday decide to start a blog, and how did they decide on a name?
- Why do we have to just live for weekends?
- How did Mr Wow win-over Mrs. WoW to financial independence?
- What decisions did Mr. & Mrs. WoW make after they chose to pursue financial independence?
- How did the pursuit of FI change their careers?
- What type of business did Mrs. WoW open, and how did she keep her overhead costs down and ultimately increase her income?
- What is a Solo 401K and why did Mr. WoW choose that option?
- What is the advantage of a Solo 401K for owner and spouse, and how does the math work?
- How important is it to control your tax rate?
- What happened to the Mr. & Mrs. WoW’s retirement accounts when they opted to bring on an employee?
- What is a Mega Backdoor ROTH?
- How did Mr. WoW find a plan administrator who could help him set up his accounts?
- Does Mr. WoW manage his own taxes, or use an accountant?
- What adjustments has Mrs. WoW made in the past four years that made a positive difference in her life?
- How does someone volunteer for international aid organizations?
- Do Mr. & Mrs. WoW add some site seeing or vacation to the volunteering they do?
- How do they plan for these trips?
“How Not to Train for a Half Marathon” – The Happy Philosopher
“Alligators and Kittens” – The Happy Philosopher
Brad, Jonathan and Joe Saul-Sehy, from Stacking Benjamins, talk about what is rewarding to your soul, give feedback to a ChooseFI community member who’s considering selling his business, and recap Harry, the Ride Share Guy’s strategies for becoming the center of a niche.
- Hurricane Florence’s path didn’t go near Brad and Jonathan, but there were tornadoes.
- FU money is better than FI money.
- Meet up in Florida during the week of FinCon 2018.
- How did Harry (from Monday’s episode) become the go-to guy for ride-share drivers?
- What strategies would help someone become the go-to person in a particular niche?
- How can you solve a problem that you, and other people, have?
- Find people who like and trust you.
- How is retail changing in 2018?
- How did Harry pursue unusual opportunities to make extra money?
- Could the “destination filter” as an Uber or Lyft driver and the potential to deduct you commute drop someone into a lower tax bracket?
- How did Joe from Stacking Benjamins become a financial advisor?
- What did the phrase “other mountains to climb” mean to Joe and how did it impact his career?
- What did Joe value about going back to school to be a teacher, but not actually becoming a teacher?
- What does it mean for something to be “rewarding for your soul”?
- How did Joe need to adjust his business in order to sell it?
- Where does financial independence stand within the personal finance world?
- Is financial independence about playing defense or offense?
- Voicemail from Jon, looking for advice about whether he should sell his business to become FI, or continue working with a few side hustles.
- Could Jon restructure his business to reduce stress and create a more positive working environment?
- What’s wrong with a life well worked?
- Is there value in purchasing a business that is inextricably tied to a single person?
- Coming up soon, Stacking Benjamins is doing live shows in Orlando, Kansas City and Ferndale, Mich.
Profit First – book by Mike Michalowicz
Harry Campbell, The Rideshare Guy, talks about what it takes to be a successful Lyft and Uber driver, the strategies he used to start his blog, and how he transitioned from aerospace engineering to full-time blogging.
What you will hear on today's show:
- How did Harry find out about financial independence and choose to pursue it?
- What entrepreneurial ventures did Harry investigate before he started to really strategize?
- How did he move from being an aerospace engineer with Boeing to running a blog about ride sharing?
- Did Harry make his college choice because he was intending to study science?
- What did Harry’s personal finances look like as he was transitioning from college to working professionally?
- How did Harry’s dad become a semi-retired bassoon repair man?
- Did Harry do anything specific to make himself stand out during the scholarship application process?
- How did Harry’s co-workers inspire him to leave a really comfortable, lucrative job?
- What is the pivot from being an engineer to getting interested in ridesharing?
- Will Uber and Lyft make you rich?
- What impacts a person’s ability to make money through ridesharing businesses?
- Bigger cities = higher demand
- Willingness to drive later hours and weekends = more demand and higher pricing
- Drivers cover their own expenses (gas, depreciation, etc)
- Most drivers are making $10-$15 an hour, a bit more in larger cities.
- Better drivers make better money.
- How would someone bump up their rates?
- Find times of high demand
- Be a savvy driver. Not every passenger or every route is good for business
- What is the upper end of what’s possible?
- Driving for Uber is super flexible, and can be cashed into your bank account within 20 minutes.
- What is the Destination Filter and how does it help someone optimize their time to be an occasional rideshare driver?
- How did Harry get started, before he had an followers or blog posts?
- What strategies did Harry use to establish relationships with reporters, media and large-audience new outlets?
- When did Harry make the big transition from working for Boeing to managing his website full time, and how?
- Best cities for driving: San Francisco, Los Angeles, Chicago, San Diego, New York, Austin, Dallas.
“The Day You Become a Better Writer” – Scott Adams