Today on Radical Personal Finance, live Q&A. Interesting time to be doing a live Q&A. Let's go. Welcome to Radical Personal Finance, a show dedicated to providing you with the knowledge, skills, insight, and encouragement you need to live a rich and meaningful life now while building a plan for financial freedom in 10 years or less.

Today is Friday, March 13, 2020, and today we do live Q&A. These are live call-in shows, just like live talk radio. You get to hear them about an hour after I record them. So today should be fun. Lots of things to talk about on today's show. Let's get started.

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Obviously, if you knew that you were going to be purchasing your rental house in a few years, you would begin by planning for the money and that includes saving money. That especially includes attention to your credit score, making sure that that's as high as possible, making sure that everything is squared away for the financing of the enterprise.

You want to think carefully through your financing strategy and then when you think through your financing strategy, you want to consider what is necessary at a certain time. For example, as we record this on Friday, March 13, 2020, mortgage rates have recently gone down and they're going down a good bit.

Who knows how low they will go? We live in very interesting times at the moment. But that's the kind of thing that I would be watching very, very carefully. When it comes to my two-year time horizon, I would be watching the different things that are involved with those mortgage rates to make sure that I have the ability to lock in a mortgage at the best rates.

Two years is close enough to start paying attention to all those details. Saving money, getting out of debt, two years is enough time to get out of debt if you have any debt, two years is enough time to make major improvements in your credit score. But obviously, squaring away the financing is thing number one.

You can't go wrong with having extra money. When you move on from there, when you talk about living overseas but being willing to invest anywhere in the United States, that brings out an even more interesting option. That's not the kind of thing that many people think about. Most people approach a rental market just simply because that's where they live.

And then it becomes fairly simple. And I think that's a sensible way to do it. You say, "Here's where I live. I want to manage the properties locally." In your case, I would want to start digging into some of the different markets around the United States. There are some markets in which you really can do very well as a landlord.

And there are some markets in which it's not so easy to do well as a landlord. If you've got the whole country available to you, you have some very interesting options. So some things that I would start to think about. Is yield more interesting to you and more helpful?

Or is appreciation more interesting and more helpful? Your answer to that question will depend on whether you need more money now and you're looking for yield or whether you are just looking for long-term capital gains. And so that will start to drive you in one direction of the market versus another.

That might yield, it will usually drive you down market because you'll often get higher yields on lower cost properties. Appreciation will probably drive you up market a little bit. If you're not so worried about the current yield and you want more long-term appreciation, then again you probably won't be at the bottom end of the market.

So I would think carefully through my strategy on yield versus appreciation. If you're going for yield, then you've got to think through what's the most intelligent way for you to get that yield. If you're overseas, you're going to face some challenges of managing with management costs. Who's going to manage it for you?

How good of a job are they going to do? And so whereas you might get, if you're local and let's say you've got $200,000 to invest, a lot of times you'll get more yield on that $200,000 if you buy four different $50,000 properties. But that's also going to be a much more intense management scenario.

You're generally going to have harder to manage tenants at the lower end of the market. You're generally going to have more turnover. You're generally going to have more involvement in the property at that end of the market. If you're going to be overseas, you very well could be able to buy a property that you could manage yourself by going up market.

Perhaps a standard suburban home, a $200,000 home would be the kind of house where you could easily bring in a professional couple with children who would be low maintenance tenants. You could create a low hassle landlording scenario where you incentivize them to take care of all the smaller problems in the property in exchange for a discount on the rent.

You could screen for higher quality candidates and that would possibly be more interesting to you and more helpful to you to get just a steady paycheck. Even just things like managing the logistics. If you're at the lower end of the market, yeah you might have more yield but now you've got people paying you money in cash which for you being overseas might be very inconvenient.

If you go up market, you probably can get somebody who you can arrange an electronic payment system and that will lower your hassle and your frustration. Now once you get an idea of the type of property that you're looking for based on your investment objectives, once you get an idea of the amount of money that you have, then in two years I would be going to some discussion boards online.

I'd be talking to real estate agents and I'd be talking and researching which markets in the country would be the most interesting for your investment goals. There's a big difference between San Francisco versus Kansas City versus Youngstown, Ohio versus Miami, Florida. These markets are so dramatically different and what I would try to do is I would try to find some investment stories that make sense to me based upon what I want and what I think local markets are going to do.

So probably you would want to choose a city in a growing region. The trend is generally from smaller towns and from rural areas into the cities and so I'd probably want to be looking at a city. I'd want to look at a city that has good long-term prospects, a good economic base and a city which is fairly valued.

Now I don't know exactly where that city is. I could throw out some cities but I think that that would be, I don't want to do that here in this context but I would be talking to some people online, talking to local investors, finding, leveraging the internet to join local real estate investment groups, etc.

and trying to get a sense from local investors what the markets are. Just giving an example, in South Florida it's very hard right now to make properties cash flow. The prices are high, rents are high but it's hard to make them cash flow. That's not the same in other markets and so you got to find those markets where the cash flow is available.

And so once you lay out your investment objectives then I would go to the internet and I'd start looking around to find the good markets that have the good fundamentals that will fit your investment objective. And then over the course of the next two years what I would do is I would get myself on a bunch of lists.

I would start watching properties, start doing my best to get a good idea of what's available in those markets so that when you get to the point where you're ready to buy you're pretty comfortable with what's been happening. Now I'm going to go out on a ledge here and do some prognostication which of course could turn out to be wrong but I think right now is a wonderful time for you to be doing that legwork.

At the moment I don't see how the United States avoids recession at the moment. At the moment, although I'd love to wait a little bit more time before being super confident in these opinions, at the moment I don't see how the United States doesn't avoid recession. I don't see how we don't have a serious increase in unemployment and widespread financial problems coming up in the coming months and probably years.

And I think on the backside of it there should be some real estate deals available. So I think your two-year timeline if you've got cash right now your two-year timeline is an excellent time for you to be looking around and be watching for properties. And so I would be investing my time heavily right now into creating my strategy, starting to watch markets and waiting to see if once we start to get into recession and towards the back end of recession waiting for those real estate deals to start to emerge.

They're not there yet. Everything is completely in disarray at the moment but I expect them to be there in a year or so. So we'll see. We'll come back in a year and we'll see how good my prognostication is but that's my opinion at the moment. Go ahead, Mark.

Excellent. Thank you. That's super helpful. So in terms of money preparing that, one question I want to ask is how to think through whether or not I should be contributing to retirement savings while saving that down payment. So quick background, I make about $4,000 a month. Currently I'm saving about 15% of that for retirement and saving around $500 a month.

So I don't know the percentage but saving around $500 a month for a down payment. Now that doesn't get super far and so unfortunately we've chosen for my wife and I a career that has we think high social impact but unlikely to change dramatically financially. And so I'm trying to think through the best way to be able to save up down payment.

So a couple specific questions on that. So first, how to think through whether or not I should be contributing to retirement savings Roth IRAs, that kind of thing. What percentage if at all versus saving up for a down payment? If I were in your shoes, I believe that there is more potential benefit financially, just speaking generally.

There's more potential benefit for you to invest in rental real estate early in your life rather than investing in mutual funds inside of a retirement plan. Now I need to for the sake of academic clarity, I need to point out that you could invest in rental real estate inside of a retirement plan.

That's doable, it's a little bit more complex and if you have not yet accumulated a lot of money, it's just going to be more complex. So I think that's a better fit for somebody who has accumulated significant assets in a retirement plan. But I don't get the sense that you're there yet as far as really significant assets.

And so what I would say is if I were in your shoes, I would stop investing into retirement accounts until I accumulated the down payment. I would do the transaction, buy the property and then I would come back and start investing in the retirement plan again. But if you have a plan, I would say if I had to wait five years on investing into retirement accounts, but I in the meantime bought five properties, the leveraging, the safe leverage that can be accomplished in those real estate properties, especially if they're well chosen, etc., is in my opinion generally going to be superior to what you can get inside of a retirement account.

That's excellent advice. Thank you. Thank you. That's helpful. Related to that, we've got about 58,000 currently fully invested in stocks within our Roths. Part of our thinking was that we could potentially pull that to pay for a down payment. So there's two specific questions related to that. First, is it possible to pull from a Roth for a rental house down payment, not your own primary residence down payment?

And then secondly, would you continue just putting the down payment funds in a Roth IRA so you have options, you can maybe build up some, it'd be a small amount of growth, but you pull out the contributions and the growth remains. Would you use that as a vehicle for a down payment at all?

Is that something worth doing or just leave it in a money market account? There is no possible – so when you are contributing in IRAs, there are a number of reasons why you can take the money out of an IRA prior to age 59 and a half without incurring the tax penalty.

None of those involve your taking out money to purchase a rental house. So the answer to your first question is no. You cannot take money out of the Roth IRA as a qualified exception in order to purchase a rental house. What you can always do is you can always remove the contributions from the Roth IRA.

If your current account balance is $58,000 but over the years you've made a total of $45,000 of contributions, that means that if you could take out $45,000 with no tax penalties leaving $13,000 in the account, there would be no taxes due, there are no tax consequences, and you could use that $45,000 for your down payment.

So in light of that, the answer to your second question is obviously yes. There's no reason for you – if you're limited on the amount of money that you can put aside, there's no reason for you not to accumulate the money in your Roth IRA knowing that you can take it out in two years.

You just obviously wouldn't want to invest it into stocks or into anything volatile. You'd want to keep it in a cash account or cash equivalent so it was stable for you to use for a rental property. So what I would do is I would split the difference. I would put the money into the Roth IRA knowing that I could use it as a down payment.

But then what I would do is work really hard over the next few years to save other money outside of it and/or to find another source of financing for the down payment, negotiate that in some other way so that I could do both, so I could buy the rental property while simultaneously leaving the money in the Roth IRA along the way.

So that's how I would handle it. All right, last question, Mark. Got a bunch of other callers, so go with your final question. Mark Miller That's fine. Let me look at this real quick. So I'll put it this way. What books would you recommend or podcasts to listen to?

I have John Reed's Getting Started in Real Estate Investing, The Building Wealth One House at a Time you recommended, as well as John Shaw's Landlording Course. The BiggerPockets podcast are also on my radar screen. Any other specific resources you'd recommend? Tavish I don't have any other resources other than those.

Those are my favorite go-to sources would be John Shaw, John Reed, and then the BiggerPockets community is great. There's nothing there. I would say probably to round that out, the best thing is going to be to find locals in the market and to find people who are going to mentor you.

To round out your reading, I would recommend, was it Cliff Atkinson's? No, it's a different guy. The guy who wrote the book Asset Protection for Real Estate Investors. He's an attorney, but he has a book. It's called Asset Protection for Real Estate Investors and I like that book. I think that would be a good thing to do because when you start, go ahead and read about your thoughts on how you would actually go around investing, how you go around setting up your asset protection plan from the beginning because it's easier to do it right from the beginning.

It's a little complex because you're managing obviously your investments, you're managing how you're going to do the financing. It's a little bit complex, but that's one thing that you could do easily is engage in your reading. All right. Thanks for calling in, Mark. Call back next week with more questions and we'll go on to Shiv.

Shiv, welcome to the show. How can I serve you today, sir? Hey, Josh. Firstly, thanks for making this platform available. I'm considering refinancing my mortgage to benefit from the lower rates. So far I have paid down mortgage aggressively. So this refinance, if I go ahead with it, it will free up good cash flow to the tune of like $1,000.

But I don't want to just go ahead and refi without good plans at hand to use that money. And that's where I want to pick your brain on like in current scenario, what do you feel are the best ways to utilize extra cash flow? So you're thinking about keeping the balance of the mortgage where it is now and just simply lowering your payments by refinancing at a lower rate and stretching them out?

Or you're thinking about doing a cash out refinance where you take equity from the home and put it into a bank account? No, not the first one. Okay. So what do you, what are you currently investing in and what do you think you should invest in? So I have 401k and other.

So right now I'm pretty stretched between mortgage and 401k. I invest about 15% of my income towards 401k and rest all towards mortgage. I don't have any room other than that. Are you maxing out your 401k? Yes, I am. So if you're maxing out your 401k, that's done. Now you could think about maxing other accounts.

If you qualify for a Roth IRA, you could max that out. If you have, if you qualify for a health savings account, an HSA, that would be a wise account to fund. I'm happy with your funding those three accounts. And I think that if you max out those three accounts, either a traditional 401k or a traditional 401k, a Roth IRA if you qualify based on income, if you don't qualify a backdoor Roth IRA is fine and then a health savings account.

I like all three of those accounts and I think if you max those out, those are good uses of the money. They're all flexible in different ways and as long as you're thoughtful with your investments, that gives you some options. Now from there, then I should clarify first, do you have cash savings, a substantial amount of cash savings?

Yes, I do. Okay. So you want to make sure you have a substantial amount of cash savings and then from there, I would go to other investment classes. I don't see any reason why somebody of a normal age needs more money in stocks than what they can accumulate inside of their 401k, their IRA, etc.

As I was just talking about the previous caller, if you don't own rental real estate, I don't know this for a fact, my opinion is just the same as anyone else's, but I think there are probably going to be some buying opportunities in rental real estate in the next couple of years.

So if I woke up in your shoes, if I were at all interested in owning real estate or investing in real estate, I would be stockpiling as much cash as I could with preparation for buying in the next year or two. Now we don't know if that will happen or not, but that would be one thing that I would be doing is just stockpiling cash ready to buy rental real estate.

Do you own any hard assets? Do you own any gold? Do you own any other alternative investments like that? No. So with some of the money, I would purchase some hard assets. I think everybody should have in their portfolio some modest amount of hard assets, something in the range of 5 to 10% of your net worth I think is reasonable.

So I would put some money towards that and just start steadily moving in that direction. That'll help you. And then from there, basically the world is up to you. There are only three basic asset classes that you can invest in and they are an active business, real property, and paper assets.

But within those three classes, there are huge variations that you can do. If you are interested in entrepreneurship or have any idea of an active business that you're interested in, I'm convinced that's going to be your highest financial possibility. So what I would do, given that I'm interested in entrepreneurship and I like the lifestyle components, I would use the freed up cash flow to allow me to pursue any business opportunity that I were interested in.

If I looked around and saw that I can drop my mortgage payment from $2,000 a month to $1,000 a month by refinancing, I would just stockpile cash until I found a business that I wanted to be involved in. That business can be as mundane as a pizza franchise or it can be as exotic as a horse farm in the country.

It can be anything that you want, but your biggest profit opportunities are going to come from business. And so I'm always going to make sure I have enough money to start businesses and/or to invest in businesses when I find an opportunity that appeals to me. With regard to real property, there's an unlimited number of types of investments that you could make and this will come down to your skill and your interest.

Most people with real property, and I'm blurring the use of that, usually real property is simply defined as land and things that are connected to land. That's fine. So you can invest in land. You can invest in houses and that can be anywhere in the world. It can be any kind of investment.

But when I think about real property, I don't use it in the strict sense. I just think about it in terms of physical investments. So you could buy RVs that you rent out to private clients on the weekend who want to rent those RVs from you. That can be very productive.

You can buy used cars and flip used cars. You can buy guns and flip guns or you can build guns. You can go and buy AR-15 lowers and assemble AR-15s and sell them. You can buy gold coins. You can invest in a diamond mine. It's any kind of real asset that you are interested in investing in.

Stamps, baseball cards, computers. There's classic automobiles. Anything that you're interested in or anything that you want to develop an interest in is worth pursuing. So that would be real property. Then with regard to paper assets, the standard approach to paper assets is clearly stocks and bonds and mutual funds and things that are inside your 401(k).

But recognize that there's no limit to the kind of paper assets that you can do. You can trade derivatives contracts. You can learn how to trade options. You can play in the Forex markets if you want to develop an interest in that. You can invest in dividend paying stocks.

The world of options is there's no limit to it. And so what I'd recommend is if you don't have specific things that you're interested in. I have specific areas of investments that I'm interested in. If you don't have that, then the first thing you should do with the freed up cash flow is start visiting bookstores and start browsing bookstores, both digital and local, and just start sampling books.

And if you bought a hundred books on investing and browsed through them and got exposed to all the different ideas, then you would start to be drawn in one direction or another. So I'll give you just for me. I'm not interested in options. I thought I was. When I was younger, I was interested in options.

Somebody wrote me an email this morning and said, "Can I hire you to consult with me on options?" And I wrote him back and said, "No, I'm not interested. I don't have any expertise. It's not of interest to me." But there are people who really love the idea of trading options contracts.

And so you can make plenty of money in that if you become an expert and you learn what you're doing. But you'll find that you resonate with certain things where you don't resonate with those other things. And so that's the important thing for you to look around and find those things that you resonate with.

In the meantime, don't be scared just to save cash. There's no reason not to save cash. And what will happen is when you start to pile up cash, even if it's hundreds of thousands of dollars, that's fine. But start to see opportunities available to you because you're now in a place where you have plenty of cash on the sidelines and then you can wait patiently for a really good deal.

>> It makes sense. Thank you so much. >> My pleasure. All right, move on to looks like Jordan. Jordan, welcome to the show. How can I serve you today? >> Hey, thanks for taking my call. I have a question about transitioning from a main career over to side hustles.

So right now I have a very lucrative main career, but I also have two side hustles of teaching at a college as well as a YouTube channel. And while those are far from being full-fledged careers, I'm trying to look forward in the next year or two and decide when it is responsible to kind of commit more time to those, specifically my YouTube channel, to make that a more long-term source of income, if that makes sense.

>> Yes. Do you think that your two alternative careers of teaching and YouTube channel, do you think that they have a higher income potential than your current lucrative career? >> Teaching by itself, probably not. And YouTube, maybe together they could equal what I'm doing now. The answer is no, it would definitely be more of a lifestyle and passion element making up for that difference.

>> And how much are you earning in your current, how much is lucrative? What does that mean to you? >> Right now I'm making about $130 a year. >> Great, congratulations. So my first question, or my first area of analysis would come down to what is the financial potential of these opportunities?

That will help you to understand where they will fall into your decision making. Now I don't think that you always have to pursue the most lucrative thing that's available to you. In fact, I think that'd be very unwise. So if you said, I'm making $130,000 now, but I have this other thing that I want to do that I'm really interested and keen on doing, but it has a maximum income potential of $60,000, I'm not saying don't do it.

But by being aware of that, it will help you make a strategic decision. That will be a very different decision making process than if your side hustle has an income potential of $260,000. And that will make a bigger difference as to how long, how you pursue it. So think first carefully and try to get an estimate of what you think the income potential is.

Now with YouTube, if you are, so teaching is interesting because teaching can be extremely lucrative. I'm a teacher. I consider myself a teacher. If I am asked what my job is, I say I'm a teacher. That's what I do. And I love to teach. I can happily teach in any context.

If everything crumbled today and I went and got a job teaching high school, I would love that. It would be a lifestyle for me that would be, I would be thrilled with it. And I have a half a dozen subjects that I would just enjoy teaching. But teaching isn't in and of itself a commitment to poverty.

You don't have to teach in a non-lucrative way. You can take that and teach in a few different ways. But of course teaching is more predictable as a career because it is so standardized in the marketplace. You can look and see how much a local community college pays you.

You can see how much a university pays you. You can see how much a government high school pays you. You can see how much a private high school pays you. And you can get an idea of what they make. And there's not a lot of variability in those types of institutions.

But you can also take a teaching career and you can amplify it. So you can get a job as a professor at a local university while simultaneously writing books, developing a global brand, selling huge amounts of product to other people, and you can use teaching as the foundation for doing it.

Probably one of the most successful versions of that that I have seen in the past few years would be the Canadian professor Jordan Peterson, who was about five years ago or a little bit more, he was just a standard professor at the University of Toronto. Well fast forward, he went through a number of events that were politically poignant and he developed a large reputation.

And he went from working as a standard professor at a Canadian university to developing a public education platform, speaking to tens of millions of people, and making tens of thousands of dollars per month. I forget, but prior, at the very minimum, no, not counting book sales, not counting anything else, but just simply at a minimum, when he was using the platform Patreon, I think he was earning $60,000 a month from his Patreon supporters.

Now clearly that is not common. But I use that as an example to say teaching does not have to be a sentence to poverty. Teaching can serve as a foundation and it can buttress your expertise. And then if you're thoughtful and strategic about how you use that, it can be something that becomes very lucrative.

Now YouTube is also interesting because generally YouTube is a sentence to poverty. The vast majority of YouTube creators will never make enough money on their work in order to support themselves, let alone grow well, become wealthy. But that doesn't mean that YouTube can't be leveraged effectively. And so if you've, if you have been successful in establishing a brand that is starting to achieve something, then you can think about how you could leverage it.

And certainly with YouTube, similar to teaching, although YouTube in and of itself is a very poor money-making idea. For example, if your dream is to become a massive YouTube creator and make millions on YouTube AdSense revenue, that's extremely unlikely, very difficult, very unlikely. But even with a modest YouTube platform, you can leverage that platform as a marketing arm for other much more profitable products, services, et cetera, ways to serve your clients.

And even a modest YouTube platform can be a very effective way to build a business. So both of those do have financial potential. And if you think about that, it will start to make your, it'll start to make your transition clearer. With my story, I was, I had a highly lucrative career.

I knew when I left that highly lucrative career that I was going to take a serious pay cut, but I could design a business in my head that had such a much higher potential of lucrative, it was, had so much higher earning potential with a better lifestyle that I didn't mind taking the dip.

So that's, it's just different if you're, and that's where you start your analysis. So that's the first one. Now, the second thing is this, do you need time that you don't currently have available because of your day job? Do you need time? Is time the limiting factor for you to develop your side hustles further?

It certainly is limiting. So with YouTube, I completely agree that AdSense is not the way to get rich off that. And I am toying with a few business ideas around that since it is a very niche market and I do think there's potential there, but currently I have a seven month old day job and two side hustles.

So yeah, I've got a little bit going on. So I can only produce about one quality video a week and understanding to like, to capitalize on the momentum I'm seeing right now, I really would like that to be up to two videos. Now it doesn't necessarily need to be that.

It could grow more slowly and maybe if I just like cut out friends or family, I could make that happen. But that's part of what I'm warring with right now. If money were not an object, if I said to you, you have to do some kind of work and you're going to make the same money regardless, would you quickly leave your day job and move to building these side hustle businesses?

In a second, yes. Okay. So that to me makes your decision clear. It's not a matter of if you're going to make the move, it's a matter of when it makes sense for you to make the move, which is clearly the question that you asked, but it does, it is important to clarify it.

Now the reason I talk about time, there are some businesses that if you invest more hours, you can make them more productive. I caution you to really carefully analyze whether you actually need more time or whether you need to use your time more efficiently. What I've discovered is often I'm far more focused and far more productive when I don't have the time available because I just got to make it work than I am when I have all the time in the world.

Even with my current business, I put a lot of time into it. But what I find is if I'm not stretched for time, I don't actually produce more, I produce less. It's much easier for me to sit around and waste time on the internet and justify it to myself while I'm doing research.

But realistically, if I had an hour set aside, then I'd only had it, I would get the work done. And so what I found for me is being busy is actually more important and I'm more productive when I'm busy with multiple projects than if I'm productive with just one thing.

And you might find the same thing to be true. If you lost your day job or left your day job, you would quickly move to working on your side hustles, but now you might be much more relaxed about those side hustles and that wouldn't be great. But if you do need more time to be productive, then I think it makes sense to start investing into that time and to putting yourself in a situation where you're actually going to be making use of it.

So that's the time question. Now, next question. Do you need money from these side hustles in order to give you the permission to leave? >>Kate: Yeah, at this point, I'm primary earner in our family. My husband is also an engineer, so it's not like we're dealing with low income there.

But as it sits right now, yes, there would need to be some financial component to these to just keep the household running. >>Dave: Could you guys live on his income? >>Kate: Not with... We have one in daycare now and then as we expand our family, it would be very unfeasible.

>>Dave: Could you live on his income plus what you're already making with teaching and YouTube? >>Kate: Not this year, but potentially within the next year or two. That's a reasonable horizon, yeah. >>Dave: Do you have enough savings that you could live on savings and his income for a year or two until you could make enough income from the business to live on that?

>>Kate: Close to it, yeah. >>Dave: Okay. Have you calculated what your actual expenses would change, for example, with taxes, payroll taxes, etc.? Have you calculated whether you could actually live on his income right now if you quit your job? >>Kate: I haven't taken taxes into account, but yes, I have looked at our expenses right now and what's left of his, but not taking into account taxes.

>>Dave: Well, if you leave your current lucrative job, how easily could you reenter it in three years if you came to find out that it was a mistake for you to leave in the first place? >>Kate: That's one of the sticky points that maybe I should have brought to light earlier on in this conversation.

It would be quite difficult. Part of the value in my position right now is that I deal with bleeding edge technology. I always say in about six months without investment in keeping up with trends and setting aside time to code and build out infrastructure, my value greatly diminishes. Now, not all the way, but I would definitely come back into the field probably at a much lower income.

It would be disruptive. It wouldn't be disastrous. >>Dave: Even if you weren't fully employed in the field, could you design some kind of backup plan that allowed you to stay current without a job? Could you stay current in the field just through self-study? >>Kate: Yeah, that's possible. The teaching I'm doing at the college is related to my current main career field.

In doing those courses, it would be natural to keep up with things, I suppose. >>Dave: You said you have one seven-month-old child and you're hoping to have more children in the future? >>Kate: Yeah, that's a whole different conversation. The reason we have so much money set aside is we adopted our first and we're undergoing fertility treatment.

That's a lovely money suck if you've ever looked into that. >>Dave: Indeed it is. Well, the points of analysis that I've given to you, I think if you think through them, talk them through with your husband, you'll probably gain a little bit of clarity. But here is what I have observed in life.

I need to record a stand-alone episode on this fairly soon. But I've come to believe that money is almost never the constraining factor and that time almost always is the constraining factor. Money is relatively easy to create. It's relatively easy to earn. It's relatively easy to create. You've already established yourself as being able to generate $130,000 per year.

Because of that, you will never see yourself as the kind of person who's only capable of generating $30,000 per year. You'll always see yourself as the kind of person who's capable of generating at least $130,000 per year. So I'm confident that if you needed to go and get a job, I'm confident that you could go and get another one and make $100,000 a year just because that's become a part of your personal identity.

You're not intimidated by that. It's just part of your identity. I also think that if you could keep current that you will have options open to you. Some careers don't lead themselves well to being able to be maintained as a backup plan and some do. But what I would do is in the transition I would say, "How can I keep current in my industry so that if I needed to come back and get this job I could?" So I would focus on a few things related to that.

Number one, keeping my knowledge and skills current. If that's what you're teaching in then you have an obvious way to do that. But that would be the first thing is keeping your knowledge and your skills current. Number two would be relationships. How can you keep your relationships current? Now relationships can be managed with just a little bit of time.

But I would make sure that I kept friendships with my boss. I would make sure that I kept friendships with my coworkers. And then I would create a very careful strategic plan with how to maintain professional relationships. I would make sure that I maintained relationships with all the other people that I know in my industry.

It could be as simple as a quarterly lunch with your competitor across town. It could be making sure that you prioritize going to the industry conference or the classes or whatever is appropriate to your industry. Wherever the who's who gathers where you build those social connections. Make sure that that's part of your plan to be there.

And especially if you're teaching I think that's a natural way for you to keep that current. And then number three is your reputation. One of the most important things is that you keep your reputation alive. What suffers is when people leave a career and they stop promoting their skills and their abilities in that career then they start to atrophy and all the reputation starts to die and then they're back trying to apply for jobs like a fresh college grad which is not where you should be.

And so you have to think through what could you do to keep your reputation current. And so I would look at publishing and publishing is a number of different things. Publishing could be things as simple as staying current on relevant professional networks, LinkedIn, Facebook, wherever people in that career are.

I would look at if you're a teacher and you're researching and involved in this at the cutting edge I would stay current on publishing in relevant professional journals. That would be a natural fit for you and it wouldn't take you that much time. Let's say you write an article every six months for a relevant professional journal.

That keeps your name current in your field even if you don't have the day job and it gives you a specific area and that gives you the ability to demonstrate to your employer or to a different employer, "Look, I'm current in this." They don't have to know that that article only took you ten hours and you invested twenty hours into keeping current but you can keep a backup plan and you need to keep your reputation fresh and alive.

I would consider carefully my web presence, my blog, my professional website. It doesn't take that much work to keep a professional website up to date in your field. A post every few weeks, a couple of articles, things like that. Just keeping your professional resume current would help you to be confident that you have options.

Now that's all designed to give you a backup plan and I think that once you have a backup plan you can feel more confident going forward with what you perceive to be a risky endeavor. For me that's always been important. My backup plan is if I go broke I can always go back to financial planning and I can always go get a job because I have the qualifications and I'm staying current enough and I have a public reputation.

If I made an announcement on Radical Personal Finance that I'm looking for a job in financial planning I'd get plenty of emails in a day of people offering me positions. A lot of them would be really interesting and I could have a job very quickly. So basically that's what you want to create for yourself as a backup plan.

I could take the exams, I could be requalified in a month and I'd be ready to go. Now given that you have a backup plan my answer is if you need more time you don't need more money. We've established that with your husband's income and with your savings you could live on that until you could generate more income.

So you don't actually need more money. The money is fine. What you need to make those businesses grow is more time. And so if this is the thing that's going to help you to get more time I say go for it. And what I would say is what most concerns me is the phase of life that you're in with a seven month old and potentially having more children.

The earlier you make this transition the better because it's a lot easier to make a transition with a seven month old than it is with a four year old. And so the earlier you make the transition the better. And so long story short I would say go for it.

Go for it quickly. Keep a backup plan. Make design a plan for income and then make sure that you have a method of accountability to yourself or to your peers or to somebody so that you don't just take the time and goof off with it but you take the additional time and you really make the business profitable.

But I would move quickly in the direction of the new businesses. Awesome. That was a wonderful, wonderful answer to my question and gave me a lot to work with. I really appreciate it. Good. Thanks for calling in Jordan. I'm so glad you were here. We've got Chase in Missouri.

Chase welcome. How can I serve you today? Hey Joshua. I have two separate questions for you if that's all right. Let's go. So for the last six-ish months my wife and I have been planning on her becoming a travel nurse and me a stay at home dad with our two young kids starting this July.

My current work contract goes through June. I was planning on telling my boss this month that I would not be coming back. We were planning on doing the travel nurse for between one to three years. Our oldest child starts kindergarten not this coming school year but the following and we're okay doing homeschool for a couple years but not forever.

With everything that's going on do we need to put a complete hold on that thought? When were you planning to submit your notice? This month? That could wait. Yeah. If you waited something like three months how would that hurt your family? It would not. If I could continue and I meant to say this to Jordan and she dropped off the line.

I would if I were in that situation right now I would just wait a little bit to get more clarity on what's going to happen. We're right in a period with regard to all of the coronavirus stuff and everything right now for clear context. We're in a period where I think the evidence that we do have that is pretty solid indicates that we're going to have a massive impact from this global pandemic.

I'm convinced it is genuinely, it has been for a while, but it's genuinely a global pandemic. I'm convinced there are tens and tens of thousands of cases already in the United States and they're just simply not tested and so that's going to have a big impact. Many countries in the world are past the point of containment.

The British Prime Minister for example or the British Health Minister was just today talking about the fact that we're moving past stage one which is we're moving past any effort to contain the pandemic and now we're moving to mitigate it just to slow it so we can provide more of the necessary health support.

I think that right now the next few weeks are going to be really, really key. What's going to happen is everyone's still wrestling with what does this mean. It's why the stock market is just massive swings. It's unclear because the data is unclear, but what's going to happen is in the next few weeks the data is going to become more and more clear.

I think at the moment, and I've said this publicly, at the moment I don't see how if there's an argument to say that this is going to be anything less than economically devastating, I cannot find it. I cannot make the argument. If you tell me Joshua, make the best case, the very best case scenario that I can see and feel at all intellectually honest about is simply it's going to be devastating economically.

Although it's going to take time because just like we have a lag with the number of people presenting with virus symptoms and economic lag, it's going to take time for that economic data to start to filter out. I think it's going to cause a significant recession in the United States, possibly worse.

We don't know right at the moment what that is going to look like. What I would see for you is number one, a little bit of extra money is helpful right now. If it's not too big of a risk on your lifestyle, a little bit of extra money never makes anybody feel worse.

Number two is if we get a few weeks further or a few months further and it looks like the fears of this being a long deep cut, maybe there's a miraculous treatment that's developed or maybe there's a miraculous vaccine development. Well, you're not hurt by that and so that would be great, right?

If some kind of miraculous treatment were developed, that'd be wonderful. In which case it minimizes it, looks like the economy is going to then everything can be restarted, great. If it's bad, then what I would say is being more well employed is going to be fine. Now in your situation with your wife in nursing, obviously that's going to be in very high demand including travel nursing.

So I'm not concerned there. My final point would be is just simply if you can figure out a way to get laid off instead of submitting a resignation, that would be more helpful for you. And so at the moment it seems premature right now to do that. But if I were you, I would follow the advice in Financial Samurai's book on how to get laid off and just simply try to see that if layoffs come to your company, to your business, that you're at the top of that list because that may allow you to make this transition that you're already making a little bit more effective.

It may qualify you for severance pay, may qualify you for extra benefits, may qualify you for unemployment. Those kinds of benefits might be helpful to you as you make that transition. So I would, if I were what you described, I would wait and I think that a month from now is going to be very instructive.

A few more months is going to be very instructive. At any point in time, you can go ahead and submit the notice of resignation, but I would wait with the hope of getting laid off. Okay. Makes a lot of sense. My next question is about tax loss harvesting. So if I have two index funds of equal amounts, one tracking the Dow Jones and one the P500, can I sell both of those for the tax loss and then rebuy the other one basically kind of switching those with that money or is that too muddied?

I don't know. I would have to read. I had to go back and do some research on that. I don't know. I would have to research that and so I can't give you a good answer. I would say that in general, the first thing I would do is I would research it.

I would try to connect. I would look at it and I need to go back and look at those rules and really understand it. And I don't have that document. I don't have the IRS regulations in front of me. But I'll tell you how it approaches. First I would read it and then if I felt that I had a clear kind of intent of the law case, meaning that I'm morally clear, that I believe that I'm following what the law says, I would just do it and take the loss because that's the kind of transaction that the first thing is you need to imagine yourself standing in front of a tax court judge and defending that decision or sitting in front of an auditor and defending the decision.

And if based upon your reading of the rules you feel like that is a qualified event, then I have no problem doing it. And chances are realistically, the chances of you getting audited or the chances of it being questioned are infinitesimally low. And there's no real significant penalty for that kind of thing.

So you've got – you're just playing the odds. It's like number one, I'm satisfied in my conscience that I'm obeying the law and I'm doing what is right and I could make this argument in public. That's the first standard. Now within that standard, there are no – the only repercussion is if you did get audited and then if you did lose the argument and then if you did have the transaction disallowed, then you would pay a penalty or this is the cost of the tax that you would have incurred otherwise or you would lose the benefit and the transaction would be undone.

And that's just not a meaningful benefit. It's not a meaningful – it's not going to hurt you. And so I would do it. If I felt that upon my reading of the laws of the regulation as written on the IRS website said that this is good enough, that this is different enough, then I would do it.

But I haven't read those regulations in enough time that I can answer on the spot for you. >>Josh: Okay. Sounds good. Thank you. >>Steve: My pleasure. All right. Move on to the great state of New York. Peter, welcome to the show. How can I serve you today? >>Peter: Hi, Josh.

Two quick ones. Number one, my wife is a French and U.S. citizen. We don't have any children but are thinking about it. How hard would it be for me to become a citizen of the EU and is it worth it? And second question is how do you know it's time to buy a stock you've had on your shopping list for a long time these days?

>>Steve: Good questions. So is the question for your citizenship or for your children? >>Peter: Since we don't have any kids yet. How about we go with me? >>Steve: Okay. So of what benefit would an EU citizenship be for you right now? >>Peter: I don't think any. >>Steve: Then it's probably not worth it.

So you should, I would need to check the laws, but generally speaking if you're married to your wife who's an EU citizen, then you should be able to negotiate a residency permit for you. You may not be able to immediately become a U.S. citizen but you should qualify for a residency permit similar to the way that your wife should qualify for a residency permit in the United States if she weren't already a resident and/or a citizen.

So that right of abode should be sufficient for you because if you became an EU resident then you would have the ability to live there, to partake in whatever the EU systems are that are of benefit for you and that would be good enough. And so my step one is I would research those requirements and see if there's a way of starting that residency process, see what it would take to maintain that residency permit, and I just don't know the answers to those things off the top of my head.

This is where it's every country matters and you have to see what the time requirements are. In some countries it's relatively easy to maintain a residence permit with minimal time on the ground. With other countries it's not. You have to be there for a substantial amount of time. Next you have to count the cost and so one of the costs of an EU residence permit or a citizenship if you're actually on the ground, and that's how you would earn it.

So let's say that you negotiate it, you think about it, and you decide, "You know what? We actually do want to go to France and we want to live there." That's generally what's going to be required for you to become a French citizen based upon being married to a French citizen.

So the marriage qualifies you for a residence permit but you have to go and put a time in on the ground. That could be very expensive for you with regard to a lifestyle cost, leaving friends, family, things that are familiar, going abroad. It could be very expensive to you from a tax cost.

France is not known for low taxes. It could just be very expensive. On the flip side, that could be something that you'd be thrilled to do. Instead of viewing it as a cost, you might be thrilled to go and live in France and you'd love the adventure of it and the chance to do it.

And so you count the costs for that. If you don't have a pressing need for it though, and you can't imagine how your life would be very different because of it, then I wouldn't push it very hard because that's an option that should be available to you in the future as long as you stay married.

You should, as long as you're married, be able to qualify for that residence permit in the future. And so unless you have some reason why it's a pressing need, why it's very important to you, and if the costs are high, then there's no reason to pay those costs right now.

For your children, however, things could be different. And so what you need to do is if you did have children in the future, you need to make sure you understand very clearly what the citizenship rights are that they would be qualified for based upon your wife's French citizenship. I can't say those laws off the top of my head, but probably anywhere they're born, they would qualify for French citizenship because their mother is French.

And probably anywhere they're born, they would qualify for US citizenship because you're a US citizen. Is your wife also a US citizen? Yes. Okay. So they would certainly be qualified for US citizenship. But in some countries, that may not be the case. And so the reason I'm saying this is probably not for France, but in some countries, give me an example, Canada.

Let's say that if your wife were a Canadian citizen, but yet she was not born in Canada, she was born in the United States, but she became a Canadian citizenship by naturalization. If she then later had a child in the United States, that child, it's my understanding, that child would not be qualified for Canadian citizenship because the child's mother was not born in Canada.

Now, if she had been a natural born citizen of Canada, then the child would be qualified for Canadian citizenship, even if the child were born outside of the United States, sorry, outside of Canada. But if the child's mother had naturalized as a Canadian citizen, but didn't give birth in Canada, the child would not be entitled to that citizenship.

And so what you want to think through is you want to research the laws of France and see if there are similar laws. Now, since both you and she are US citizens and you've been living in the United States for a substantial time, no matter where your child is born, your child would be qualified for US citizenship.

But if she found out that for some reason the child would not be qualified for French citizenship unless the child were born in France, then you would want to go and have the child in France. Chances are the child would be qualified for French citizenship no matter where the child is born, which means that if you did have a baby, and we're going way down the ifs range, but if you did have a baby and if you did feel like you were capable as a couple of doing birth tourism, you would be wiser to go to a third country and have the child in a third country instead.

Could be as simple as Canada or Mexico or any number of other countries that also have benefits. And what I would do is I would research the places where the child could have interesting options based upon the French heritage. So I would look at the former French territories and colonies and things like that.

And perhaps there would be an option where the child could get a really interesting third citizenship based upon being born in a country that was a former French colony. And so that would be a way that from birth your child would have three citizenships. But for you, back to your question, if the cost is high and the benefit is low, don't do it.

If the cost is low, you'd really enjoy living in France, you're living on investments, not on earned income, thus you wouldn't generate high taxes, well then go live in France for a few years and go ahead and get your French citizenship. But that's my answer. Questions on that so far?

>>Steve: Nope, makes sense. >>Steve: With regard to buying a stock, what is your method, personally, of assessing the value of a stock? >>Steve: So personally I tend to refer to a third party and the one that I trust the most is Morningstar. >>Steve: Okay, so you're then not talking about a stock, you're talking about a mutual fund.

Are you talking about a mutual fund or a stock? >>Steve: A stock. I'll use their rating system or one of the other analysts to give me X many stars or it's a buy or a hold or whatever. I'm not doing my own intense analysis of the balance sheet or anything like that.

>>Steve: Well, in that situation, if that's your method of analysis, then you buy when you have the money and when the Morningstar analysts recommend it as a buy. >>Steve: Seems pretty simple. >>Steve: Yeah, and I think that the answer, it is simple and I don't need to expound on it but the first question is always what do I believe makes this a good investment?

On what basis am I going to judge this? And so then you follow that chain of logic through and if you trust the Morningstar analysts that they know what is going on and you believe that they are competent in doing that and then they make a buy recommendation for the stock, well then the answer is simple.

You wait for them to make the buy recommendation, you wait for yourself, for you to have the money available and then you go ahead and make the purchase. All right, we go on now to looks like the state of Virginia. Welcome to the show. How can I serve you today?

Got a caller from the state of Virginia. Go ahead please. Going once, 571 area code, your name is not on my screen. Go ahead please. All right, we will come back to you in a moment. Looks like now to New York City. New York, welcome to the call. How can I serve you today?

>>Jaycee: Ashfaq, hey, thank you. This is Jaycee. So first, thank you for the opportunity. Hoping you and your family progress through this turbulent times healthy and unscathed. My question probably lost its time in terms of opportunity time, but I figured I would ask you anyway. Two weeks ago, I was pondering pulling out $50,000 out of my 401(k) via a loan to put aside for potential opportunities.

So two weeks ago, I'm thinking, okay, something's going to happen. It's not really reacting towards what's going on globally. So unfortunately, something that soon was going to happen, happened. But I didn't do it. But I was wondering if I could get your opinion on that type of method of taking out money via a 401(k) loan for interest of the opportunities.

That 50K would represent about 10% of my portfolio at that time, a lot more now. But my interests were either to have it liquid for any emergency use, or potentially multifamily investment. I already own two families. So I was thinking, depending long term or short term period, there'll be some opportunities.

And the third one was actually to invest in a family dental practice, a new dental practice in Latin America. So those are the three opportunities that I was seeing for that need. I already have 20K in hand. So I have some emergency money. It was more about kind of taking it out before what ended up happening in the crash currently occurring.

So I guess the real question for you is, is that type of methodology solid in the future? Since I think it's already too late for me to do so without losing Sabir with the fact that the market already crashed 20%. And if that's something that if there's something I'm missing in terms of taking out money to a 401k loan.

I'm open to it. I'm not hardcore opposed to the idea. I used to be. I used to kind of follow the standard financial advisor advice to say, don't touch the money in your 401k, just like I used to follow the standard financial advisor. Don't take the money out of your 401k.

And I think financial advisors who maintain those positions generally have good reasons for doing it. The experience that most of us financial advisors have is the vast majority of people that we observe who cash out a 401k or who take out a 401k loan, spend the money on consumption rather than on investment.

And so when you see this again and again and again and again, it causes you to be fairly jaded and to basically assume that everybody is going to spend the money on consumption rather than investment. And so you learn that you've got to play the averages and so you generate these go-to opinions such as never cash money out of a 401k.

Because you know if somebody leaves their job and they cash money out of their 401k and they take it, they take the distribution, you know it's going to be spent on frivolous consumption. That's just what 90% of the people that you watch do it. And so you generate these opinions.

Or this is what happens when people do a home equity loan of credit or they refinance their credit cards into their house. When you watch again and again and again that somebody has credit card debt and then they take out, they refinance their house and they pay off their credit card debt using their HELOC, well you know that almost every single time they're going to go ahead and increase the credit card debt again and then now they don't have the money in their house because they used it on consumption.

Thus they're not getting wealthier. So I used to follow that with regard to 401k loans and with just taking distributions from retirement accounts. I've since modified my opinion on that largely because I'm in a different space now. You know the average listener of radical personal finance is not a consumption driven person but rather an accumulation driven person.

The average listener of radical personal finance is not an entry-level worker but rather a very high earning, highly educated person. So now these days I just take it much more tactically and say is this the best source of funds at this particular time because the mathematical answer to the question comes down to what's the alternative use of the dollar.

Let's say that you were going to go to your 401k, you're going to sell stocks at a 20% discount or 30% discount, whatever the portfolio is down over the last couple of weeks and in order to take a 401k loan out you take $50,000 but you're able to take that $50,000 loan and invest it into a dental practice in Latin America but that dental practice grows in the next five years where your equity stake in that dental practice grows to be worth $400,000.

Well obviously under that scenario, obviously that was a better move than leaving the money sitting in mainstream US equities. And so if you are really confident in that kind of hardcore rate of return, really just this is a potential I'm convinced, maybe you're going to do medical tourism and you're going to do a medical tourism for dental practice in Costa Rica or Mexico or something like that and you're convinced that your family member if they just had $50,000 they'd be able to go from one dental office to a string of dental offices with thousands and thousands of Americans and Canadians coming down to get their dental work done in Costa Rica or Mexico.

Well in that situation you should do it. But if you don't have a compelling use of the dollar then it all of a sudden doesn't seem so good. So my answer to you is what's the better investment? Because you should always go with the best investment that's at your fingertips and the factor of whether you take money out of the 401k or whether you take money out of a 401k or whatever it just comes down to that those are just technical details.

You have to be convinced of what the better investment is. So to give you a direct answer first are you convinced of what the clear investment is or is it just an opportunity fund? Let's call it an opportunity fund. There is an opportunity for the dentist. There's a young cousin who's actually here, putting tables to make money to be able to start that practice and he's going to be going back soon.

He's staying with me so we're very close. And I haven't gauged that opportunity to him but I see that as a potential market and I could definitely support him and trust him for that. And the other thing, the other investment was multi-family which is something I'm already learning and expecting to heavily get involved with in the next few years.

So those are the two elements that I could navigate comfortably. Again, it was something I really wanted to pull out two weeks ago. Now I'm more hesitant on it. So I am more hesitant today than I was two weeks ago. Unfortunately, I just didn't take that. I didn't do it two weeks ago.

So... You learned a lesson on that one. Yeah, yeah. I was, you know, I figured I'd still ask because in the future it might happen again. Of course, of course. Why not learn from it? Well, the lesson should be that if you are thinking about doing something like that, you need to honestly assess how serious you are about it.

And then if investments are up and markets are good, just do it. Don't wait on it. Because if you have an alternative use of the dollar, don't wait. Do it that you think is better because it feels a lot, it doesn't feel so bad to sit back and miss out on a little bit of upside.

It feels a lot worse to want to do something else but then to have to look at your portfolio and say, "Am I really going to sell these investments at a discount?" So here's my answer to you. From what, from a few minutes of what you're saying, I don't think, I wouldn't do, I wouldn't sell and take a loan on something that is just a maybe, maybe an opportunity fund.

I would, because I think that again, the opportunities are probably going to be very affected. And that's one of the things about where we are right now. The reason the market is down in your US-based investments is the same reason why the market is down in your Mexican investments or is down in your Asian investments.

The entire world is being affected right now, which is the huge risk of a viral infectious outbreak is, that's what I've talked about extensively on the show. It's such a huge risk because of its global nature, which means that not only do you have risks in the United States, but you have risks everywhere.

So if the United States goes into recession, that in and of itself makes it a very difficult time to do things like start new businesses in Latin America. You know, there's the saying about when the United States sneezes, Latin America catches a cold. It's just the United States is such a huge powerhouse economy influencing the whole region that often the effects of what happens in the superpower expand to the region around.

So here's my answer. I wouldn't sell money in my 401k. If I were going to do this deal, what I would do is I would just cut my expenses now, which I think everybody should be doing, is cutting expenses now to the significant discretionary expenses need to go away.

I would be saving as much money as possible, making as much money as possible. And then if you haven't already done it, I would establish a credit card portfolio and set up the credit card portfolio with the intention of using some of that money for opportunities. Because in the situation like you're describing, you may come to a point, before I would cash money out of the 401k and take a 401k loan, I would just simply move the investments from mutual funds to cash, keep them inside the 401k, and I would finance the need with 0% interest rate credit cards.

Then if necessary, if the investment fell apart or if I lost my job or something like that, then that's the point that I would go ahead and make the distribution from the 401k. But I think that's a safer move than just taking the money out. And it gives you more options to make up the difference with increased earnings, increased savings from your expenses.

Now that's risky. You've got to be very good at your behavior, but that's what I would do from a financial engineering perspective. Well, thank you. I definitely will plug your credit card course. I have taken it and I do have a credit card portfolio in hand as needed. Very low usage right now, but it's there just in case.

I also would plug the other two courses and I've gone through them. I'm going to the survival one right now. Preparing is in that as well. So really thank you for everything you've done. I really appreciate it. Good. I appreciate that plug. And of course, if any of the rest of you are motivated to go and take those courses, you can find those at radicalpersonalfinance.com/store.

Radicalpersonalfinance.com/store. At the very least, anybody who has a credit card should go and take that course. All right, we go now to Atlanta. Welcome to the show. How can I serve you today? Hi, Josh. Can you hear me? Yes, go ahead. So let's make things interesting, shall we? I am in pursuit of freedom.

Right now, financial freedom in terms of lowering taxes, which is everyone's biggest expense. I'm also seeking freedom from obligations that states place on me. And I run a single member LLC and I can live anywhere, though right now I'm stuck in the US for more than just the coronavirus.

So with that in mind, I'm pursuing what the privacy guru, Michael Bazell, calls nomadship. So this involves taking up legal residence in South Dakota, getting a postal box that has a legal address, getting a driver's license, car registration. The reason South Dakota is good is because they're used to RV people coming and going and they don't make many claims on their residence.

So in the end, you end up with a legitimate address and identification without having to set foot in South Dakota except to set this all up. From that point on, you can live wherever you want. And so South Dakota also has the benefit of being a no income tax state.

And so my question is, if someone were to become a nomad in this way and just live all around, how would they make sure that the other states they live in during the year don't make any claims on them, tax or otherwise? Each state, and to be clear, do you need to be or desire to be in the United States or are you also willing to consider an international approach to this?

Oh, I'm willing to consider it, but I suspect I will probably be in the US for the near future. All right. So let's start with the US based way to do it. The way that you establish, every state is different. And so if you're going to be, your business is digital, I get the impression your business is digital?

Yes. Okay. Every state has different laws. And in the United States, this is a subject that's not nearly as talked about as it is internationally. Now, I've studied the laws of a bunch of states, I've worked with some clients on this and we've kind of worked it out. But there's a legal answer and there's a practical answer and you're going to have to navigate through it.

The legal answer is each state has a different formula that they're going to use based upon to establish your being a tax resident of that state. And this is where it depends on what state you're going to spend most of your time in. If you establish your legal residency in South Dakota and then you spend a year in Texas living in an RV at a Texas RV park, the state of Texas is generally not really going to care whether you're actually physically in their state because the state of Texas doesn't impose state income taxes.

That's a very different scenario than if you establish your legal residency in South Dakota and then you move to the state of New York and you rent a condo in the state of New York and you're physically inside New York for 365 days running your digital business. Now the state of New York is going to care because the state of New York wants their income taxes.

So the reason that these states such as South Dakota, Florida, and Texas allow nomad residency status is that they're not extracting income tax revenue from you, from anybody, and so they don't mind if you're in their state and you register things. To the state of South Dakota, with you being an RVer, that's a benefit to the state because now they're generating tax revenue on the licensing of your vehicle, of your RV, of anything else, any other business that you do with the state.

The local insurance agents are generating some revenue based upon selling you South Dakota qualified insurance and no other South Dakota residents are paying income tax anyway and so South Dakota is happy to have you. So if you spend your time in South Dakota, in Wyoming, in Texas, and in Florida, basically you could probably spend as much time as you wanted in those states and not have any problem.

One thing you want to think about is not only tax but also the concept of domicile. If you have significant assets, domicile can be important with regard to your estate, how your estate is settled. If you are a resident of South Dakota but you have a house in Florida and then you die, how is your estate settled?

Let's skip that because it's a little bit complex and let's just focus on income tax. Now beyond that, you research the laws of the state that you want to check out. So let's say that you did like the state of New York. Well you look up the state of New York income tax residency and you see what the state of New York has and most states have a combination of factors that they discuss.

One factor is the amount of time that you physically spend in the state. If you're in a state 11 months per year in the state of New York and you're in the state of South Dakota one month per year, it's a little hard to argue that South Dakota is actually your state.

So time is a factor. In general, if you are going to be a nomad physically moving around, well it's, you know, if you spent four months here, four months there, four months in the other place or five months here, five months there, five months in the other place, you're going to be fine.

The second factor that is usually going to be considered would be basically the concept of nexus. How connected are you to the state? Again New York, you have a house, you have a business, you have a New York LLC, you spend 10 months a year in another state but your house, your vote in New York, all the stuff is in New York.

Well now New York is going to say, "No, look, you're really connected here." And so when I'm teaching somebody and consulting on how to move out of one of these aggressive states, the two most aggressive states being New York and California, one of the most important things is to move your nexus, your life to another place.

And generally if you're not really wealthy, not generating a huge amount of income, you're not, it's not a big deal but New York and California are extremely aggressive in chasing down people who claim former residency. There was a court case a number of years ago about a guy who moved to Texas but he would commute back and forth to New York City and I think the distinguishing factor came down to where his dog was located.

And if my memory is right, he won the case with the state of New York because his dog was physically located in Texas. And they came down and said, "Listen, yeah, I know he goes back and forth but he's a Texas resident. That's where his dog is. So if you got a dog, make sure your dog is in Texas and not in New York." So these are all kind of the legal questions and legal considerations.

If you make a lot of money or you have a lot of money, there's a much bigger target on your back than if you're just living on whatever income you generate from your business and you don't have a lot of money. But you still want to go ahead and set up your status in a way that follows the law.

That's the legal consideration. Now let's talk practicality. Practically every state is different but practically because there aren't border controls at the states between various US states, there's a decent chance that you just kind of filter through without being found. Now this is harder than it once was. And so an example would be the state of California.

In the state of California, all of the roads are monitored by automatic license plate reading systems. And so let's say that you are a nomad resident of South Dakota but you drive your South Dakota plated car in California and the California license plate reading systems identify the fact that you're basically there all the time.

Well after a while, I don't know what that time is, I don't have any clear data on that, but after a while you're going to get a letter from the state of California saying you're a California resident, you need to plate your car and become a resident of California because your South Dakota plated car is in the state of California.

That's probably, that's very different than maybe the state of West Virginia. The state of West Virginia is not nearly as committed to the license plate reading system as is California and they're not nearly as aggressive with tax collection as is the state of California. So practically speaking, you could probably spend significant amounts of time in a state and generally slide under the radar.

This would be where some of Bazell's other techniques that he would teach would come into play as well. It would be useful for you if you're going to spend significant amounts of time in a state, it'd be useful for you to have a car that's plated in that state to lower your profile and you could do that without necessarily establishing tax residence.

I'm not comfortable trying to go to the point of trying to say to somebody, "You're going to be, you're going to register in South Dakota, but you're going to live full time in North Carolina." I don't think that works. Number one, it's not legal and I want to encourage people to follow the law and I think that in time, in the fullness of time, it's going to come back to hurt you.

If you were hardcore and by hardcore I mean if your last name was Bazell, then I think you could probably get away with it, but you're going to need to be hardcore and not using cash, not having a significant record of your vehicle located in those places, generally just maintaining an extremely low profile.

I think that that is possible. Let me give you a scenario that would be practical. If I were a California resident who was seeking to leave California and move to Nevada, the first thing I would do is I would follow the law and I would very clearly and firmly establish my Nevada residency.

I would sell my house. Selling house is different. You could still own a house in California, but it's a whole body of evidence. I would create this whole body of evidence that I had moved from California to Las Vegas and I would make sure that I moved my addresses, I moved my driver's license, I moved my doctors, I changed from being a part of the California local physician's board to being a part of the Nevada local physician's board.

I registered to vote. I joined a church in Nevada. I would create this whole body of evidence for me to be in Nevada. And then from then on, I would keep my footprint in California very, very light. I wouldn't use a credit card in California. I would use cash in California.

I would minimize flying into California. I would consider driving into California instead of flying into California. I would just basically practice all the good privacy techniques to make my presence in California very, very light. On a situation like that, I think you could legally spend several months per year cumulatively in California and I think practically you could spend months a year in California without becoming a California tax resident.

But I wouldn't go all the way to saying, "Yeah, I've just made everything in Nevada, but I'm going to try to be in California the whole time." Is it theoretically possible? I bet you Bazelle could do it. You could probably do it. But it's not legal and I think it burns you more than anything else and so I recommend against that.

I think the better strategy is just simply to choose the state of your residency and then establish a couple of places in the United States that you like to be and then in the same way that when I teach this internationally, just do that within the United States and that solves your problem.

Yeah, that's great. And I said I'm pursuing freedom, so New York and California aren't even in my vocabulary at this point in my life. I agree with you and I'm happy to hear that. Those states are important because they are aggressive and they are, especially as more and more people are leaving those states, the government in those states is paying very careful attention to people who are leaving those states and they are suing people for tax revenue and they're going after them.

And so I have a huge listenership in California and New York. It's very important that if you're going to do it, you got to do it legitimately. You can leave California. You can leave New York. You can. They can't keep you forever. Hotel California was a song. It wasn't the real thing, but it can feel like it if you're just trying to do this on paper and you can't be sloppy about it.

You can't just say, oh, I'm going to go and move my driver's license to South Dakota and that's good. No, if you're going to leave New York, you've got to genuinely leave New York and you've got to amass the whole body of evidence that indicates that you have moved from New York.

And then later, I would say if you want to go back and visit family and things like that, fine, you can do that later, but you can't just do it on paper. It's got to be done legitimately. Sounds like a plan. Okay. I would say to you, obviously, if you like being in the United States for lifestyle reasons, as millions of people do.

I don't. I'm prepared to leave, actually. I'm actually thinking about starting up my next company outside of the US. I know that that doesn't solve tax obligations, but so that if I decided to leave in the future, it would be easier to do so. So this is a lot simpler than you probably understand right now, though.

The United States is a bear when it comes to tax obligations. And frustratingly, because of citizenship-based taxation, the frustrating thing about that is you can never get out fully of the US tax net unless you formally renounce your US citizenship, which is a very significant step that the vast majority of those of us who are US citizens will just simply never do.

But in some ways, you can make a very strong argument that it's a lot easier for US citizens who want to save taxes by moving abroad to do so on a modest amount of income than it is for other people. So let's use Canada and the United States as an example.

If you were a Canadian who was interested in leaving Canada and becoming a tax resident somewhere else, you could do that. And if you made a million dollars per year in Canada from your online business, you could move to the Cayman Islands and you could establish residency in the Cayman Islands where there's no income tax, and you can stop paying any tax obligations to the Canadian government.

That's the benefit of being a Canadian. But in order for you to accomplish that, you have to basically sever all ties with the country of Canada. That would include... And now, you don't have to do all of these. Again, it's a body of evidence. You're basically creating a case that you could present if you ever had to.

But the safest way to do that is to basically terminate all of your connections with the country of Canada. You sell any real estate that you own. You close investment accounts or move them elsewhere. You cancel any credit cards that you have issued in the country of Canada. You move bank accounts out of the country of Canada.

You basically disconnect all of your association and your ties with the nation of Canada, except for the fact of your Canadian citizenship and passport. Now, the great thing about that as a Canadian is you can move to the Cayman Islands. You can earn a million dollars a year and pay zero dollars of income taxes.

It's 100% legal. It'll save you hundreds of thousands of dollars to do that. And at any point in time, you can maintain your Canadian citizenship, which means you could still go back to Canada in the future and live there at any point in time and reset up that whole system.

And that's a major superior scenario over the United States. It's also a much more moral system of income tax collection than the United States system, which charges you income tax even though you're not a resident and not receiving any benefit from US services. So that's the case against the US system.

But here's the counter argument. As a US American, your rules for your tax obligations are much clearer than they are in Canada. And so if you want to save money on your US taxes, all you need to do is be physically present outside of the United States at least 330 days per year.

And if you do that, you will qualify for the foreign earned income exclusion, which will save you money on the first about $105,000 of your income. And it's just very simple. It's a number. How many days are you physically present in the United States? Now without going into all the details, there are other ways of qualifying as well, which could allow you to spend up to a few months in the United States if you are a bona fide resident abroad.

But in your situation, you're a genuine nomad. It can be as simple as this. You move your legal residency to the state of South Dakota. Then you get in your RV, you drive to Canada, and you spend six months in Canada in your RV. And then you quickly drive through the state of the country of the United States and you spend six months in Mexico or five months and 29 days or whatever.

And you can get six month visas for both of those countries. Fairly simple. You can do that without becoming a tax resident of Canada. You're not a tax resident. You're a tourist. You can do that without becoming a tax resident of Mexico. You're not a tax resident. You're a tourist.

And because you're physically present outside of the United States for at least 330 days, you qualify for the foreign earned income exclusion. You can do that while keeping all of your infrastructure in the United States. All your bank accounts stay the same. All of your investments can stay in the United States.

Everything stays very simple. You're a tax resident of the United States. You just qualify for the foreign earned income exclusion, which allows you to not incur federal income tax on your first $105,000. Now the last piece of that is with the good tax planning, if you're willing and if your business qualifies, if you'll establish your business where you actually are not an employee of a US based company, although you can still maintain your US single member LLC, if you'll simply establish an offshore IBC, a company offshore, and then sell your or transfer your US based LLC to that offshore company, then what can happen is that that will also allow you to eliminate your employment taxes.

At $105,000, your employment taxes as a self-employed individual are going to be a bigger deal than your federal income taxes. That can save you, basically on $105,000 of income, if you eliminate both of those, it'll save you about $30,000 a year on taxes if you're a single individual. It doesn't cost too much and it's not too complicated.

You can keep everything in the United States and do that. >>Trevor: Yes, that makes sense. I should have clarified the business that I have in mind. I think it can very much take off. And so if it's a small amount of money that you're making, it doesn't make sense to have the company outside of the US.

But if you have plans for a sort of seven figure business like I do, I guess that's why I think it would make sense to have it outside the US so that if it does take off, I can either leave for the year and take advantage of the foreign income exclusion or make the tough decision to renounce the US citizenship and have a business that's outside of the US and then also be outside of the US with presumably at that point a different passport.

>>Steve: I think you misunderstand the laws. If you are physically living in the United States, it's very inconvenient for you to have an offshore company and in fact will increase your taxes. So you've got to first establish where are you going to be. Where are you actually going to be?

And if you're actually going to be in the United States, you don't generally want to have an offshore corporation without understanding. Obviously there are places for it, but it's complex and you incur significant amounts of taxation. Now it's a controlled foreign corporation. When you have a controlled foreign corporation, there's a special tax for it and it adds complexity to your tax returns.

If you are physically outside of the United States and qualify for the foreign earned income exclusion, then it's very simple for you to have a foreign corporation and that can be helpful for you, but it's probably unnecessarily complex. There's not really any reason not to use your current US based LLC as the front company for that work.

There's no reason unless you're ready to go all the way offshore and you're saying my plan is as quickly as possible. I'm going to get out of the United States and this business takes off. I'm renouncing my citizenship. Well, that's a situation that makes sense to go all the way to going hardcore offshore, but the best system for most US Americans is going to be to keep your US infrastructure, which is useful.

Keep your bank accounts, keep your US LLC and just establish a foreign corporation as the owner of your pass through single member LLC. Because what happens is that keeps your tax, that allows you to take benefit of working for a foreign corporation under the IRS rules, but from a practical perspective, it allows you to keep everything US based.

So you're not going to try to, you've got some, I don't know, pick your jurisdiction, some Belize company that you are trying to get a merchant processor for or you're trying to, it's very complex. And so it's simpler for you to keep your US based LLC, but just simply establish it as a single member LLC, wholly owned by a foreign corporation.

So from your personal tax perspective, you are working for a foreign corporation that eliminates your employment taxes, but from a business operation standpoint, everything is inside the United States. So you can do that, then you can go abroad, start working on a replacement citizenship if you don't have one already.

And then while you're doing that, once you're in a place where you see if the business took off, then you're in a situation where, "Hey, I'm ready to go ahead and renounce citizenship." Now in years past, that foreign corporation was more important because prior to the Trump, the Tax Cut and Jobs Act of 2017, the Trump tax reform, you could retain earnings in your foreign corporation and not pay taxes on those.

So the way it would work prior to the Tax Cut and Jobs Act is if you made a million dollars in your business, you could pay yourself a salary of $100,000. That salary could come to you income tax free because subject to the foreign earned income exclusion. And then you could accumulate $900,000 in your offshore corporation as long as that money stayed in the offshore corporation and did not get distributed to you, then you would not incur any tax, any current tax on it.

It could just stay in the foreign corporation. Well after the Trump tax reform, that is no longer the case. The Trump tax reform brought in a new system called the GILTI tax. The I can't remember these stupid acronyms. Anyway, it's called the GILTI tax where basically if you have retained earnings in an offshore corporation, then you pay a tax rate on those.

And so the simplest thing, so it all depends. There's different, $100,000 of income is different, $300,000 of income is different, and at $3 million of income it's different. Because what you can do is if your income comes even higher, then what you do is you go ahead and establish one more piece to it and you bring in a C-Corp in the United States, own the offshore corporation, and the offshore corporation owns your operational LLC when you get higher because that will cut your overall tax rate.

But long story short, let me keep it simple. Move to South Dakota, that's simple. Then physically remove yourself from the United States for at least 330 days per year. You don't have to have a residency anywhere else under those obligations. You don't have to become a tax resident anywhere else.

If you want to be a nomad, you just find the places in the world that you want to be a nomad. That's three months in Mexico City, three months in Bogota, three months in Sao Paulo, and three months in, you know, two months in Toronto, and one month in the United States to visit family, wherever you want.

Any country in the world is fine, and you can do that without establishing any kind of residency visas. You can move around. You won't become a tax resident in those other places. You'll just spend time in them, and then you'll be qualified for the foreign earned income exclusion. If you have a business that's online, set up a single member LLC in the United States and set up an offshore corporation from a tax-free jurisdiction, it doesn't really matter what jurisdiction you use.

Pick one that's cheap and that doesn't have any tax obligation. The reason it doesn't matter is because you do all the business through your US LLC. So your bank accounts and things are already in the name of your US LLC. If you already have a single member US LLC, keep everything you have because one of the things that's so frustrating, ask me how I know.

One of the things that is so frustrating in the United States is it is brutally difficult with all of the to get bank accounts. I was denied for three different bank accounts in the United States because of my not typical string of patterns and information. And the know your customer laws have become so onerous in the United States that it's brutal.

It's absolutely brutal. It cost me huge amounts of money to get functional bank accounts and was extremely difficult. So and I would say to you actually before you move to South Dakota, get all of your infrastructure established now. So make sure you have all the bank accounts, all the credit cards, everything already established now, including for your business.

Then when you go offshore, then you go ahead, do your move after everything's established and you've got multiple backups, everything is good. Credit cards, bank accounts, have backup bank accounts, have normal profiles on everything, just have everything ready to go. Have all that stuff. Then do two things. Move to South Dakota and then establish your offshore corporation and all you need to do is just simply establish a what's it called in your LLC?

Resolution. Just establish a resolution in your LLC to transfer your single member LLC out of your name into a foreign IBC that you own. And so if you'll just simply do that one thing and you'll transfer your single member LLC in the US to a foreign IBC, from the IRS perspective, a single member LLC is a disregarded entity.

And so what happens is because your single member LLC is a disregarded entity, you now file as an employee of a foreign IBC, which allows you to eliminate your self-employment tax. But the banks and everything else, as long as you have all the infrastructure done in advance, you, I shouldn't say that because there probably is some kind of regulation that you're supposed to notify them if there's a change of ownership.

Nobody but the IRS has to know that you have an offshore corporation is basically the same scenario and that will make your life a lot simpler and a lot easier. So those are my answers to you. Publicly speaking also, I have done all of Bazell's solutions and once you start, as far as I've tested all of his recommendations, but what I'll tell you is that from an international perspective, it's very difficult to maintain some of those things when you go abroad.

So when I went abroad, I had this whole extravagant, intricate communication system set up. It utterly failed when I went abroad. And so what I'll tell you is if I were going to go back and, I mean, I don't necessarily want to do all this live on the show, but if you get with me privately and book a consulting call or something, I'll go through all the details of what works going abroad and what doesn't work and I'll save you a huge amount of hassle.

Because some of that, all of his stuff works awesome in the United States and you can use some of it when traveling. I'm not saying that you can't use it when traveling. You can, but it gets, it's stuff gets messed up and so you need some more mainstream solutions that work better when traveling.

We'll leave it there publicly for now. Understood. Sounds good. That helpful? Did I answer your question? It does. Yeah, I think we're on the same page here and, you know, hey, go where you're treated best. I agree. And I'll tell you, it's from a freedom perspective, as a freedom lover, this will be offensive to many Americans and I hate that it is, but I feel generally far freer outside of the United States than I do inside the United States.

And as I've talked about when I've done shows on, you know, PT theory, et cetera, I feel much freer outside the United States than I do in the United States. And it's nice to have options. One of the things that has happened as I built an offshore structure, as I built options, as I built other places to live and paths to residency and citizenship, et cetera, it's not easy.

It's not cheap. It's expensive and hard and time consuming, but it has allowed me to feel much more relaxed about all the stuff in the United States. I feel much more disconnected from it because I'm not, I don't feel like I'm a slave to it anymore. You know, I feel much more relaxed about, you know, whoever is elected president and all this stuff and I still care deeply about that stuff.

I care because, I care because number one, I'm sad for what the United States of America used to be, what it could be, kind of the bones of the country that I see as really awesome. I'm sad for what it could be and I feel a deep connection to my fellow compatriots, to my fellow citizens, to, I feel a deep connection to American citizens.

But in terms of the practicality of it, if I ever renounced my citizenship, I would still feel that same sense of care and connection to American citizens. But it would be, it just doesn't make sense to rely on one jurisdiction, on one country to try to, you know, do all that stuff for you.

It doesn't make sense. And if you have the ability to do it without it harming your lifestyle, I highly recommend it. I agree. The most patriotic thing you can do with an out-of-control government that craps all over the Constitution is to boycott it. Yeah, I agree. And it's also the most peaceful thing, you know.

I'm not, if I were a state, I think that, you know, places like New York, right, I think that they're paying attention finally to people leaving the country, sorry, to people leaving the state. I think that the state of California, I don't know, that was too, maybe that's a step too far.

I think that New York and New Jersey are paying attention to it. And when I look at, you know, how do I make my voice known about my displeasure about this thing, I don't know, I'm not going to fight, I'm not going to pick up a gun, I'm not going to engage in violence.

So I can speak up, I can exercise my freedom of speech and do that. But at the end of the day, it's not effective, right. And there's so many people that speak, I mean, in the election season, everyone's like, "Well, so and so is elected president, I'm moving to Canada." They don't ever do it.

It's stupid. Everyone knows it because they don't do it. And so the most effective thing that you can do is genuinely to go. And then, and I don't expect to make much of a difference, but if you do leave, it does establish, it does speak clearly. And I think it's the peaceful way to handle, the peaceful and moral way to handle significant differences of agreement.

Well said. Thanks, Josh. Thank you for being here. All right. For our last call today, we go down to the state of Illinois. Welcome to the show. How can I serve you today? Yeah, can you hear me? Go ahead. All right. Hey, hopefully you didn't cover this. I doubt it.

I just got on. Through a number of different encouragers, especially you, or at least including you, I started a keto type diet recently and have had a lot of success. But I've also started sort of emergency prepping recently. And I found that those two things are kind of difficult to do because a lot of the stuff that's easy to store isn't very compatible with what I've been eating.

I just didn't know if you thought about that. I know you kind of are in both worlds. I kind of wanted to see if you had any input for me. I've thought extensively about it. If I were starving or if I were going to face, if I were, if I were starving or if I were going to face severe risk of infection by leaving my house, I would very happily eat rice.

I would very happily eat bread. I would very happily eat all those things and I would have to serve those to my children. It is a historical blessing to be in a situation where we can be so picky with what we eat. Throughout the vast majority of human civilization and throughout the vast majority of the world, you ate the food that was available to you and you were thankful to have it.

And so I feel like a stuck up snob with my food opinions based upon the way that much of the world eats, even with regard to the amount of money that I spend on food. And so I think that the vast majority of, the vast majority of long-term storage food is a total blessing to have and can keep me and my family alive and happy and our tummies full if we needed it and it can keep our neighbors alive.

And I think it's cheap and it's a miracle of the modern world that I can stock up on that kind of stuff at pennies on the dollar. And I think it's irresponsible not to have huge amounts of that kind of food set aside and stored for hard times. So that's point one.

Point two, and in an emergency, I'm not going to worry about how fat I am. I'm going to worry about how much, how many calories I have. Does long-term health matter? Yeah, of course it matters. So maybe the keto diet is more healthy or less healthy, who knows? Maybe it's more healthy, but in a short-term emergency, I'm more worried about staying alive and staying fed than I am worried about the long-term impact of a diet.

So that's thing one. Thing two, you can store lots of keto-friendly foods if you have the right storage mechanisms. And so the key is it's a little bit harder to store for most people, but it is possible. And so your friend, if you are having a meat-heavy, low-carbohydrate, high-fat diet, your friend is a freezer, a deep freezer.

And so right now, if you were to go to my house and open my freezer, you would find that the entire freezer is full of meat. And we cannot put anything in the freezer because it is completely full of meat. And it's all stocked up for hard times. It's all stocked up for a corona quarantine, but I can eat steak and beef and pork and chicken and I can eat that stuff for months based upon what is stored in my freezer.

And that's the primary foundation, which is interesting because if you go to a more carnivore style, low-carbohydrate, it's hard to do. You can't actually do keto high-fat on carnivore really very well. But if you go to like a carnivore style of eating, it makes things profoundly simple. If all you eat is meat, all you have to store is meat and you can store meat basically indefinitely in a freezer.

And so what I do is I buy meat and I go ahead and because I have experience getting some freezer burn in the past, I make sure that I package the food for no freezer burn. What I do, and this is easier in some places if you can purchase it from a butcher and it all comes in butcher paper, etc.

But what I usually do is I repackage all the meat in vacuum seal bags and I package it ready to go into sous vide cooker. And so it makes things really simple. I buy a big chunk of meat, I cut it into steaks, I put the number of steaks that my family eats into a freezer bag, I season them, then I vacuum seal it and put it in the freezer.

And then if I want to make steak for dinner, all I need to do is sometime in the afternoon, one o'clock, two o'clock, three o'clock, doesn't really matter, I just go ahead and grab a frozen bag of steak out of the freezer and then plop it in the sous vide cooker and cook it for a couple hours or whatever until dinner time, sear it and serve it.

And so that makes things really simple. So the answer is a freezer. Freezer also works well with vegetables. So you can store huge amounts of vegetables in a freezer. You can buy bags of pre-made freezer, bags of pre-made frozen vegetables from Costco and such. It's not necessarily the most cost-effective, but of course it's normal food and if you have a deep freezer you can do that.

The fat is where things can be more difficult, but then you can easily store fat, whether it's in the form of oil, whether it's in the form of butter. Butter freezes beautifully. You could also buy canned butter or ghee, and so you can get your fats through some of those.

Some of the nuts also store well, just in standard long-term food, and so those are good solutions. And then the nice thing about kind of a keto, non-keto, primal, paleo type of eating is that it actually works really well with food production. So if you have a source of meat, you can store all your meat alive and then when you need it you kill it and eat it.

And that can be done on a small property with small animals. So if you're going to be a hardcore prepper and you want to eat healthy, well the answer is obviously animals. So small animals are extremely convenient because they're in perfect serving sizes. If that's rabbits, if that's chickens, if that's quail, if it's guinea pigs, any kind of small animal like that is really convenient to store alive until you need it.

And so if you're going to be really, if you're worried about a grid down scenario, you don't have a freezer, etc., the simplest way to store your meat is alive, and then just take it in small portions when you need it. This is also where the benefit goes to smaller animals versus larger animals.

You know a small goat will serve you for a reasonable number of meals. It's a lot harder to preserve a large cow. So you need the freezing and so if you're going to, you either need to freeze or to can or to jerk or to dry or to salt, some other way of preserving large animals.

But it works really well, kind of a keto style diet works really well with animal production on a property or around you, and it works really well with vegetable production, vegetable and fruit production, because those are things that you can store your keto food in the form of seeds and grow it little by little as you need it.

Obviously more work associated, but those are my answers to you. And then there are other technologies. You can can vegetables, you can can meat. One of the things that I've done in the past when I was working on this, I wanted to can meat. So I went and I bought big 40 pound boxes of chicken from the restaurant supply store, and I just went ahead and canned it myself.

It's hard to find, if you want to go and buy commercially pre-canned, pre-tinned, you know canned stuff, you can generally find that with obviously tuna fish and canned chicken. It's hard to find canned beef, but you can go ahead and can, or I don't know why they call it can, it should be called jar.

You can go ahead and jar beef yourself if you want to store it at shelf stable in a shelf stable way, and I've done that. It just requires a lot of work. And then finally, then if you're willing to spend the money on freeze-dried food, then the freeze-dried food can certainly solve that problem as well.

You can buy every kind of meat, freeze-dried meat, and/or you can buy dehydrated or freeze-dried vegetables and you can store the food very effectively for decades in that form. So those are your answers. >>Steve: Good, appreciate it. Hey, did you make it home? >>Aaron: Not yet. I'm sitting in a hotel room wondering if I'm, as soon as I hang up, I moved my flight up, and so I'm just hoping that I don't turn on the internet and see more travel restrictions, otherwise I got problems and I'll have an adventure getting home.

So if Joshua's not on the air next week, you know that he's swimming across the ocean trying to get home. >>Steve: All right, we're praying for you, man. >>Aaron: Thank you very much. And with that, I think we have an appropriate way to close out today's show. Thank you all so much for listening.

I hope that you've enjoyed today's Q&A. One of the nice things, I'll be here for you. If I'm locked in my house, I'm going to be doing a lot more, so I'm here to work with you in the coming days. Looking forward to, well, we got difficult times ahead, but I'm looking forward to being here with you day after day.

If you have found value in today's show, I'd ask you for a few things. Number one, please go and take a moment and rate and review the show on whatever platform you're listening to me. That's super helpful when you do that. That's free, doesn't cost you a thing. Number two is I would love it if you would join me on Patreon at patreon.com/radicalpersonalfinance.

So helpful when you join me there, and that also will give you access to these Q&A calls, which I thank you for that. And then number three, a couple of the listeners have talked about some of the courses that I have available. You can find out all of those courses at radicalpersonalfinance.com/store.

I have three courses there at the moment. Let me tell you about them. Don't skip forward too fast. Just give me a moment, because what you'll see is how useful they are in this particular event that we're facing. The first course that I released that's still on the store there is called How to Borrow Money Safely and Never Pay Interest Using Credit Cards.

And in that course I will teach you how to establish a large credit card portfolio, which gives you large amounts of access to credit, while also teaching you how to do it at a very low cost so you don't wind up paying stupid interest rates. You borrow the money at 0% or a maximum of something like 3% in some cases.

The key is you've got to do that long before you need it. And so as you heard with the listener who was talking about a 401(k), he's already taken action on that, and so he has other sources of money. And so it's safer for him to keep his money in the 401(k), move it to a cash account so it's stable, and then if he needs financing, just go ahead and use credit cards for financing.

And the point is that if he needs money all of a sudden, and he can always take the money from the 401(k) and distribute it later, but by not doing it while he's working, he puts himself in a better tax situation where he's not making distributions out while he's working.

Let's say that he takes a, in his case he was doing a loan, which I acknowledge that. But it's much better for him to have the credit card portfolio, and then if he gets laid off or something like that, then when his income is down, then he goes ahead and takes the distribution from the 401(k).

That course was developed about two years ago. Everything in it is still relevant today, and it's been a good one. And we'll make options for you. And especially as we go into what I think will be recession in the coming months, you want to make sure that you have large amounts of credit available to you.

Do not use your credit for consumption. If you do that, you wind up in a bind. But you can use your credit to live on if you have an emergency situation, or possibly to take advantage of an opportunity to start a business, etc. And one of the things that I teach in that course is simply how to do cash management and how to manage cash as compared to credit.

I don't want anybody to wind up deeply in debt. I'm opposed to that. But there are many situations in which you can simultaneously say, "I don't want to be in debt," while also having credit cards. In addition, if you have credit card debt right now, you need to get that cleared right now in preparation for recession.

And that course is all about how to help you do that cheaper, faster, and safer along the way. I know it sounds like these things are in opposition. And I agree that in some cases they can be in opposition, but they don't have to be. So check that course out at RadicalPersonalFinance.com/store.

The second course that is available is the Radical Personal Finance Guide to Career and Income Planning. And that is all about how to build a job that's going to pay you a lot of money that you don't want to retire from. And the number one priority that you have in a recession is not to lose your job, which is where that course comes in.

Now I've done public shows on that as well, but if you are in a situation where you're worried about your job, you better get involved in building your income so that you can maintain it. You better have a plan for transitioning to a new job. In the call that was talked about, "Should I go to these side businesses?" You can see how valuable it is if you know how to maintain your presence and maintain a business while you're transitioning to other things.

And so we talk about those subjects in the Guide to Career and Income Planning. Number three is how to survive and thrive during the coming economic crisis. And that show I released last year, and it was all about how to survive and thrive during the coming economic crisis. And in that show, I laid out all of the strategies that you need, or in that course, I laid out all the strategies that you need to survive during an economic crisis.

Now I used a sensationalistic title to try to sell more of it so that I can make more money, but it's a very practical course. We are going into economic crisis. It might be short and shallow. I don't think it'll be short and shallow, but it might be. It might be hard and deep and long.

I expect it to be hard and deep and long. But it is not too late to prepare for economic crisis. It is time to prepare for economic crisis if you have not previously prepared. The best time to prepare was two years ago. Best time to prepare was a year ago.

But it's still time to prepare because I don't see how this does not become a national and international economic crisis. Now hopefully it will be light and short and shallow, you know, little upturn in unemployment. Hopefully there'll be some medical solutions quickly. I hope that's the case. I don't think it will be.

And so I need you to be prepared for that and there's still time. What you need to be looking at is recognizing how while there's plenty of toilet paper on the shelves, sorry, while there's no toilet paper on the shelves because people are panicking hysterically about toilet paper, there's plenty of other things.

And so if you're not stocked up, if you're worried about things and you don't have things stockpiled, please, I'm not teaching fear. I'm not trying to get you to spend money stupidly. But there are a lot of things that you can do to prepare your family for hard times and you should be doing those things.

Put simply, in addition to that, you need an internationalization plan. As you heard with the caller where we talked about going abroad, you need an internationalization plan. Let's say that, remember the caller earlier today, I think it was Jordan, where she was talking about what would happen if she's got these businesses.

Jordan has the ability to do that business from anywhere in the world. So use this as an example. Let's say that Jordan makes the move to their new businesses and then her husband loses their safe and secure job. What's she going to do in that situation? Well they might decide that it's best for her to go back and get her $130,000 a year job back.

But maybe she's making $40,000 or $30,000 on the side with her side businesses. If Jordan and her husband have a good internationalization plan, then they can just simply move out of their house, rent it out, and they can go to a lower cost of living area. This might be difficult with coronavirus because lower cost of living areas might be more dangerous in a global flu pandemic.

But Jordan may be able to just simply go to Mexico City, go to Chiang Mai, Thailand, famously Chiang Mai, Thailand. If the coronavirus is everywhere, then they might go to Chiang Mai, Thailand where they can live on $1,500 a month very comfortably and be able to live and work there while she's just simply living off of their income.

And they can come back from that with new businesses growing, etc. And so internationalization gives you plans for backup plans in bad economies. Internationalization gives you plans for backup sources of income. Maybe the economy in the United States totally implodes, but the economy in maybe South Korea does a much better job of handling the coronavirus than the United States does.

And so South Korea recovers more quickly. Well, if you have the ability and the skills to live and work in South Korea, most people don't, but if you did have that, then that provides a good situation for you to be able to go and live and work there. Or the caller who was talking about the French passport, if you have set up where you have an EU passport and maybe your college funds implode in the United States or the healthcare system is overwhelmed in the United States, but you have an EU passport, you can take your kids to school in the EU, you have options.

And so that's one of the things I teach is a lot of internationalization in that course. It's a really good course. I think I've only—I don't remember—I think I probably had one refund on it and I've had a lot of students in that course. All of them have been satisfied.

So please give it a shot at radicalpersonalfinance.com/store. And then finally, I am still in the middle of teaching this class on family preparedness. And that was a cheap course on just basic preparedness, so things like food storage, etc. And I've been delayed this week on getting new courses out, but there are new courses still coming.

You can still register for that. Go to radicalpreparedness.com. And in those live courses, if you're saying, "Hey, Joshua, I can't find toilet paper. What do I do?" I'll teach you what to do. Or if you say, "I can't find food because the shelves are bare. Teach you what to do." If you look out the digital window today, you can see how important some of these things are.

So there's a time and a place. I'm going to be doing courses and whatnot in the future on life insurance, etc. But I started with these because I have been concerned for the last few years about preparing you for what you see right now. Now, I desperately hope I'm wrong.

I desperately hope I'm wrong. I don't think I am. And so I have been concerned about this for the last few years, which is why you can see the theme in all of these courses fit together because I've wanted you to be prepared. Because if you are prepared, you can go into a crisis and you can weather it in comfort and you can use it as an opportunity to move you to more and more wealth.

Go to RadicalPersonalFinance.com/store. Give them a try. A 30-day money-back guarantee on all of them. So hey, if you're cheap and a little bit unethical, but hey, you'll be following the rules. Just buy the course, get the information, and then I don't know, I guess I'll get a refund. I hope you don't do that.

I hope you like it enough and you say, "I can see I can make tons of money on this." But go to RadicalPersonalFinance.com/store. Sign up for those courses there. If you'd like to ask me a question on next week's Q&A call, go to Patreon.com/RadicalPersonalFinance. Sign up there. Thank you for listening.

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