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Workout and perk out with the PF Black Card. Join today for zero enrollment and $24.99 a month. See Home Club for details. It's Friday. Today, live Q&A. 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, it's Friday. Today, we do live Q&A, a recorded live Q&A show. Any Friday that I'm able to set up the technology, be in front of a good internet connection where we can do it. Works just like talk radio. Callers call in. We chat about anything that is on your mind.

Sometimes it's fun. Well, usually it's fun. I love these shows. If you would like to join me for a Friday Q&A show next week, join as a patron of the show. That's patreon.com/radicalpersonalfinance, patreon.com/radicalpersonalfinance. That will give you access to the Friday Q&A call-in shows. We begin with Pete in Massachusetts.

Pete, welcome, sir. How can I serve you today? Pete Slauson, CEO, Radical Personal Finance, Inc. Hey, Josh. Hope you're doing well. Credit card question for you. All right. Let's go. I finally got through the credit card course after buying it about a year ago. I'm glad you got through it.

I had a little time on my hands. Yeah. It was great, actually. The question I have is it's a little bit of the opposite issue, I think, that some of the content was geared toward. I actually have a pretty robust number of credit cards. I've sort of done the airline points churn over the years.

At this point, the annual fees that I have on all of the cards, it's not insane. However, there are cards that I have that are pretty idle where I'm paying the annual fee at this point. I'm wondering where the sweet spot is between having the credit, keeping my FICO score up, but on the other hand, not paying fees for cards that are really unlikely to ever be used.

I don't think that you should pay annual fees for cards that you're not using. I don't think the value is there even with regard to your overall credit, et cetera, unless you think that all of a sudden you need to borrow a bunch of money and so you need to keep that utilization ratio really low.

If that's the case, then maybe you have to just keep it because you need it, but it doesn't make sense to keep cards with annual fees around for a significant amount of time. The first thing to think about is the only cards that you should keep that have an annual fee is a card that has a benefit that you're actively using.

So if you have a premium card, an Amex Platinum or a Chase Sapphire Reserve or something like that and you say, "Yeah, I've got these annual fees, but I'm really using this card and I'm getting the benefits from it. I'm taking full advantage of the program and it's worth my paying the money to have access to this premium card," then I think that's fine, but you're not going to have more than a couple of those that you're actively using.

You're not going to have an Amex Platinum and a Chase Sapphire Reserve and a Delta Amex and a Marriott, whatever their thing is, and a Hilton with $195 here and $400 there, etc. There's no need. And so what you should do is you definitely should get rid of those annual fees.

So a couple things that you can do. Number one is you can just call them and see if they're willing to waive the annual fee. Sometimes they'll do that, and so if you call and say, "I'm going to cancel it before the annual fee," sometimes they may be willing to waive it.

The best thing to do, if possible, though, is to downgrade the card. So downgrade it from a card with that company that has an annual fee and move it to a card with the company that doesn't have an annual fee, and/or move the credit limit if they'll let you do that.

That way you can keep the credit limit available to you, which will help your utilization ratio if you use credit card debt in the future without having to pay those annual fees. Interesting. Okay. And will most of the credit card companies, I would assume some of them would waive the fee, but I can't see that happening, but will they generally downgrade the type of card?

Generally, I believe so, yes. I don't have enough personal experience. I've never played the mileage game to have all the premium cards. I have a couple of premium cards that I use, but not for the mileage game. And so I don't have extensive personal experience with it. I know it's possible.

And I've paid a lot of attention to those who do the mileage game, and they certainly do have the ability to do that. So I don't know the percentage. I can't tell you, okay, 50% of them will, but I know many of them will. Great. I'll give it a try.

All right. Thank you. Any other questions then before you go, Pete? That's it. Great. Nope. I'm back. All right. Very good, sir. Glad you are here. We go now to Jason in Dallas. Jason, welcome to the show. How can I serve you today, sir? Hey, Josh. Good to be talking with you.

Been listening to you for about three years now. Love your stuff. Thank you. I'm glad you're here. Can you hear me okay? Yeah, sounds good. Go ahead. All right. So I had a question just about my wife and I's plan for the next couple of years and just your financial advice and just wisdom on it.

So currently between my wife and I, she makes 80 grand a year. I make 100 between two jobs. And we have a home before the COVID. We could have sold it for 230 and we have 98,000 left to pay off. That was the BC era, the before COVID. Before COVID, before the Rona.

Exactly. We've been pretty aggressive on paying off our house and we're on a plan to pay it off by about this time next year with just being real good, real frugal. But with all of the economic impact of Corona, we were thinking possibly of shifting that plan instead of paying off the house as quickly as we can to stockpiling that money and possibly getting another house and renting out our current one.

The caveat that makes all this kind of tricky is we have our first child on the way due in October. And by the end of the year, my wife plans on quitting her job, staying home with kids and starting our family. So that would drop our income down to 100 a year.

And then now we're between would we be able to rent out our current house and have enough money for another house for us to move into when our current rent wouldn't cover our mortgage since we have a 15 year mortgage. Is that clear enough? So the specific question is, should we buy a rental at this point in time?

Is that the basic question? Our dream is to have two, three acres and a bigger home to raise more kids. And that's what we want to move into. And we don't know whether to stay with our specific plan to pay off our house and then stockpile up money to try to get into that next 10, 15 year house or save the money now and look for the opportunity in the midst of this crisis.

I would not pay off extra. I would not focus on paying off my house right now, especially if you've previously thought about working on a plan where you're going to purchase investment property. I'm all for having paid off houses, but I think that it makes more sense for you to start if you're interested in owning rental property.

I think it makes much more sense for you to start by building up a rental portfolio early in life, setting that in place so you can have your tenants paying off your rental mortgages for you and then go to paying off your house and paying off the market, paying off the rental units.

When you look at where we are right now, I don't see any benefit of your having a paid off house. I do see a benefit of your having a lot of money in the bank. And so what I would do is – and just be clear, that was an inaccurate statement.

If your house were today totally paid off, then it would be helpful. It would be beneficial. But right now, if you lost your job and you instead of having a $98,000 mortgage, you have an $88,000 mortgage, you're not helped by just simply having a slightly lower mortgage balance. What you need is money in the bank.

And so when we're in an emergency like we are right now, the first thing I do is stop all debt payoff, just stockpile cash and then wait and see. Wait and see what opportunities emerge. Now I think there will be quite a few opportunities to invest in real estate very productively and profitably in the coming years.

And so that would be my plan is I think that one of the most important things with real estate in order for real estate to work effectively, you can often find a deal but there are times when it's a lot easier to find deals than others. And depending on the market that you're in, there have been a lot of markets where there simply haven't been any deals available over the last couple of years.

I've known a lot of real estate investors who said, "I can't find anything worth investing in." Now if this recession goes according to normal recessions, then starting six months from now, a year from now, there's going to be a lot of distressed sellers and that means that there's going to be a lot of opportunities for real estate investment.

And so if you can maintain your income and if you can have savings, that's the time to start expanding that portfolio. The other thing that makes me say that is with regard to timing. You want to have two to three acres in the country, bigger house, great. You don't need it with a baby.

You don't need it right now. You need it in five years. And so what I would do is I would set out a five-year plan to buy five rental houses in the next five years and then go ahead and once you've bought those five rental houses in the next five years, then make the switch to the two to three acre farmette out on the edge of town with a big old farmhouse because a five-year-old will actually use that.

You don't need that at this stage of life. And so I'd keep on investing. I'd stop the early payoff and I'd look for deals. If no deals emerge and you're a year from now and you got $98,000 in the bank, then just stroke a check and pay off the mortgage.

But I think you'll start to see some deals that will entice you to invest. Okay. Yeah, I love that. Can I ask another question? Go ahead. Given what you just said about the five rental houses in the next five years, do you think that the rental market is going to be abundant or a lot of people are going to be renting as opposed to buying?

Say I do find some deals, will I be high and dry and not able to find any renters? I think you can always find a renter at some price. The rental market is certainly being impacted right now by the RONA on all sides. There are some risks that are emerging that I never foresaw.

I never foresaw states saying you can't evict your tenants. You've got massive numbers of tenants behind. And so I think that there are some significant risks. But at the end of the day, people need a place to live. And so the biggest risk would be for you if you bought rental houses in a place that was dying, if you bought rental houses in a town that was dying or in a part of the country that was dying and people are moving from there and moving into the big city.

So you want to think carefully about where you buy. But I think that you can mitigate that risk. There's always going to be somebody available. Somebody wants to rent a house at some price. And so you'll just need to study the rental market as you get closer to buying and make sure that the demand is there.

Okay. Okay. Last question. With our current house, we have got a 15-year mortgage and about 1850, 1875 mortgage. But I believe we can only rent it out for $1,500 or $1,600. Is that anything worth refinancing to try to get the rent to be able to cover the mortgage or just float that cash to $300, $400 extra a month to make sure that the house is paid off and don't worry about the closing costs of a refinance?

I wouldn't say don't worry about the closing costs of a refinance. Calculate them. We don't want to be flippant here and I don't know what those costs would be for you specifically. But conceptually, assuming that the costs are acceptable, conceptually, if the basic plan is we own a house right now and we want to move out of this house and rent it out and we're going to move into another house and maybe you do that every year for the next five years, do the nomad real estate investing strategy.

In that circumstance, then yes, I think refinancing to a 30-year mortgage makes sense. And so I would refinance to a 30-year mortgage and I would put that 30-year mortgage up to the maximum amount that I thought was going to make sense based upon what I could rent it out at and how much money and cash I could get out of the property.

Because I would not recommend that you have a 15-year mortgage at $1850 and you can only rent the house out for $1500. That's unsafe, especially if your wife is going to stay at home with the baby, you're losing $80,000 in your household income. That's just not safe to have an extra $300 payment.

I'd rather the payment cash flow for a couple hundred dollars because my tenants can pay off that mortgage for me over the next 20, 30 years once I get them in there. And it doesn't matter whether they pay it off in 15 years or 30 years, I need the property to cash flow safely so that I can have safety in my portfolio.

And so yes, calculate the closing cost, calculate the cost, calculate the interest rate, etc. But conceptually, you want to finance it for the longest period that you can at the lowest cost because that increases your safety. Now I need to of course point out the big risk is don't spend the money.

The big risk that if you do a cash out refinance is if you go and spend the money and you buy a new car because well we're having a baby so we need a $50,000 car and you start spending it on fancy consumption items, then you start going backwards.

So if you do a cash out refinance, then put the money in a bank account and use that as your investing fund that you're going to use to buy more rental houses in the next few years. And then if you don't find those, then go ahead and pay off the mortgage again so you can be back where you are.

You don't want to go backwards because you do a cash out refi and then start spending the money. So be careful there. Okay, great. Great. Thank you for being here. All right, we move to Kevin in Colorado. Kevin, welcome. How can I serve you today, sir? Yeah. Hi, Joshua.

I've got a couple of quick comments and then a question. Okay. First comment is, I'm a little bit concerned about the cost of the mortgage. I'm not sure if it's going to be a good idea to pay off the mortgage. I mean, I'm not sure if it's going to be a good idea to pay off the mortgage.

Okay. Hi, Joshua. I've got a couple of quick comments and then a question. Okay. First comment is, radical personal finance destination events. You said something about that months ago and I just wanted to encourage you that that's something that I would be absolutely interested in. Thank you. I was just about ready to commit.

Like I had thought it through and I talked to my wife. I was like, okay, here's what I think would be interesting. And the thing that I've wrestled with is just simply how do I make it like cool? How do I, what do I want to do? Am I trying to do something high end?

Am I trying to do something entry level? Is it going to be all lectures? Is it going to be hanging out, et cetera? And I finally had kind of built out the idea and then coronavirus came along and shut the world down. And so it was, I was glad, I was thankful because, you know, one of the groups of people that I just feel for intensely right now is anybody who is associated with events and makes their living on events.

There's a lot of people who make their living on events and those people are just, are being hammered right now with everything closed. And so I was fortunate that I hadn't made reservations. I hadn't committed financially. And so I put it on pause just until travel restrictions, you know, lighten up a little bit.

But thank you. I appreciate that. What would you like, if you were going to come to a radical personal finance destination event, what are the kinds of things that you would really love to see at that kind of event? So first of all, for it to be possible for me, it would have to be family friendly.

So in a setting that I could bring my wife and boys with me. I would love, I get the feeling that a lot of us listeners would just really enjoy each other's company and bouncing ideas off of one another, almost kind of like a mastermind of just various people with some similar ideas, but obviously with completely diversified experiences.

So definitely time for that sort of thing. I personally, like ADD, I really don't like to sit down for hours and hours of classroom or session, but having some of those options available, obviously, with maybe some guest speakers on certain topics that they're experts in would be a lot of fun.

But nothing too, for me personally, nothing because it's not, it wouldn't necessarily be focused for my industry, not necessarily a rigorous academic program, but more of a little bit more casual, but with definitely opportunities to maybe find some different type of people to invest with and come up with business ideas together.

Cool. Well, what you're saying is pretty much along the lines of what I have planned. I definitely would like to do something that's family friendly, just because it allows me to incorporate my family, which I enjoy. I'm at a stage of my family where it's a real burden on my wife for me to go away.

And so if I go away, I have to make sure that I provide help for her in the household. And so it's a lot easier if I can just do a family event and bring my own children along. And so I definitely would like to do it as a family friendly event.

And I think that a lot of the, I think I would guess, and I've proven this from the meetups that I've done, the casual meetups here and there, but I think my audience does skew. We probably have, as an audience size, we probably have more children than some other personal finance podcasts do.

And yeah, what I would like to do is strike that balance of have some useful education. But the challenge is that I believe that there's real value. When I analyze the world and kind of look at what's working and what's not, as I see it for pure education, pure education is administered more effectively virtually.

I can create something, if I'm just going to teach, teach a class, I can create that more effectively in a virtual format where it's more thought out, it's better prepared, it's more polished, it's more to the point. And then I can provide that in a way, in a format that is really helpful to people in a virtual course or in a written format, preferably with different modalities that serve people.

Some people like video and video with illustration. Some people like audio so they can listen to it at multiple times. Some people with some good written notes or transcript. For straight up education, I feel like that's a superior mode of delivery. I generally don't go to conferences just for education.

In fact, if I go to conferences, I often skip a lot of the educational sessions and I just get the tapes and I listen to them later. I've done that for years. Even when I was a financial advisor, I would go to events but I would never go to the sessions because why should I spend my time going to a session when I can just simply pay $300 and get the recording of the whole thing and then I can listen to every session instead of having to pick and choose.

So what I look for when I go to an event is I look for basically three things. Number one, what's timely? And so what you can get at an event is you can get somebody's real life opinion. So the fact that we're on this phone call right now, if you want to ask me about something right now, Friday, April 17, 2020, then you can say, "Yes, what's your opinion right now?" And that's something that you can do at an event that you can't do reliably in virtual events.

Number two is you can get personalized feedback. And so one of the great things about an event is that you have an opportunity to interact with a teacher, with an expert, with a presenter. And so you can ask personalized questions. You can get real-time follow-up. Something is unclear or you disagree with something or you think that maybe the group would benefit by another idea.

That's better done in a live format than in a virtual format. And then number three, and that personalized feedback is as I see it, some of the most valuable things you can possibly get. And then number three is the community. And so the basic reason that I go to events is community.

And that community for me is sometimes with my audience. But a lot of times for me that community is people who are on the journey with me and people who are ahead of me who I can isolate in one place. And so I can fly all over the world and try to nail down all these experts and call up so and so who lives in Chicago and say, "I'm going to come see you in Chicago.

Can I have lunch with you?" But that's a pretty expensive proposition. And for me, especially at this time in my life, it's pretty expensive to do that. Or I can say, "Hey, you're in Montevideo. Can I come hook up with you there?" But those things are possible. But it's a lot easier if I go to an event that's kind of a centralized attraction for the particular subject that I'm studying and now boom, boom, boom, boom, boom, I can meet five, six, ten people at one event.

It's a very efficient use of the time. And so that's my analysis on the value of live events. I think in the future live events are going to be much, much more important than they are right now. As I look at many industries, my industry, other industries, I think what I see happening is that a lot of stuff is moving to digital interaction, virtual interaction.

But when you move to virtual interaction, the live friendships, the live relationships, the live event becomes even more important because it's the context of a real relationship, an in-person physical relationship that makes the digital communication that much more effective. So if I'm running a company right now that's working virtually, I'm not going to run a company where we don't get together in person.

It might be fine if we work virtually the vast majority of the time, but we still need to get together at a minimum a couple times a year in person because that's where that human dynamic is enhanced so that now when we go back to the virtual environment, the virtual environment is more productive.

And so you didn't ask for it, but I agree with you. Go with your question, Kevin. So the question has to do, another real estate question. So I'm selling a rental next week actually that's got a lot of equity and I am planning on using the funds, reinvesting using a 1031 exchange to avoid paying the capital gains.

And so my question to you, so I've been just trying to think about how to make this decision whether I want to either A, go with the 1031, reinvest in another investment property or B, hold off because I'm not really confident about the market being able to stay nearly as strong as it's been.

Maybe it's more worth it to actually pay my taxes for what could be a much better opportunity in six months or a year or so. And so I'm trying to just, I really respect your opinion, the way you think about things. And I was wondering if maybe I'm not, I haven't thought about all of my options here about why I might go one direction or the other.

How much are you selling the property for and what's going to be the capital, the taxable gain? So I'm selling it for $320,000 of which about $200,000 is taxable gain. And how much cash are you going to have after the sale? $240,000. Have you identified some, already looked at a property that you'd like to 1031 into?

I have not. I don't have anything in specific. And actually just last week, the IRS came out with, they said that normally there's a 45 day identification period after the sale and they've extended it right now to July 15th for anything between now and then. And so I really, I didn't want to identify anything too soon because I feel like the market is in flux.

And so really I've kind of been holding off on even trying to identify or replace a property. It's really hard. This is a really hard question because... Can I kind of tell you how I... Go ahead, please. So the way, yeah, so my thoughts now are, okay, I expect my tax liability on this to be about 40,000.

And so my thought is if I expect the market to be flat or increase in value at all, it's a no brainer, but I don't. So I guess then the question is how much do I expect the market to drop? And the bigger of a drop I expect, and obviously what I expect doesn't mean what's going to happen, the less leverage.

So one of my thoughts is if I feel like it might be relatively stable, but I'm not real confident, maybe I just buy the minimum amount of replacement property so that I'm not increasing my leverage. But it's still, I mean, it's a good chunk of change to have to pay to the tax man.

Oh yeah, big time. If I decide to hold off. When does the property, so when does this property close? On Tuesday, next week. I think that's a really hard question because at these numbers, if we knew what was going to happen in the real estate market with some certainty, then we could sketch out the numbers.

So let's just talk it through for a moment because I think the problem is predicting the timing of this situation. My current operating assumption as of April 17, 2020 at 1.30 PM, my current operating assumption is that we are with coronavirus first. I've had a hard time understanding it, but I don't think either of the extreme positions at this point in time are probable.

I don't think that coronavirus is just something to be taken lightly. It's clearly something significant and serious. So the allegation of it's a hoax or it's a political play, I don't think that bears out. My evidence for that is number one, you can see that there are in certain communities with certain risk factors, you can see that a lot of people are dying.

Number two, more importantly, you can see that on a global basis, basically almost any country that has the capacity and looks at what's happening, takes it very seriously and has imposed draconian restrictions. That tells me that this is not a hoax. But on the other side, it doesn't seem like the most pessimistic predictions have come true.

And so it doesn't seem like it is so bad that the pessimistic assumptions are true. And so we seem to be kind of squarely in the middle where I think it's bad and I think a lot of people are going to continue to die today. Record number of people died yesterday in the United States and 4,000 people in one day.

And so it's just going to continue. And the problem is I think that in some ways this is the worst situation we could have. If we could be convinced that it's not a big deal, that this stuff is not necessary, we can just go back to life as normal and everything was overblown, great.

And that means that we could improve the, we could say, well, at least we were cautious, maybe we were too cautious, but let's get back to work. On the other hand, if it were really bad, then everyone would be justified in saying it's really bad. But right now what I think is going to happen is I think there's going to be more and more rebellion from citizens saying, "You're not going to shut my life down.

You're not going to shut my business down for something that is the way it is." And there's going to be just a patchwork all around the world of people trying to navigate this middle ground. In some ways, I think the middle ground is the most difficult situation for us to plan in.

So I still can't quite figure out what's going on with coronavirus. Today there were a couple of stories about some increased antibody testing that seemed to on the surface of the headlines, I haven't been able to dig into them yet, wait for them to be debunked, but on the headline seemed to indicate that maybe the theory that there have been more people infected by it could actually be true.

I discounted that theory last week for a couple of reasons, but with some more testing that's going on, maybe that is actually true. And so in the coming weeks, as has always been the case, we'll start to know more and more. So that's my kind of current up-to-date talk about the virus.

But unfortunately, I still find that maddening because we don't know what to do. All I know is for me, I'm going to continue to stay home, but I'm lucky, I'm fortunate in the fact that I can stay home without it harming my productivity. It's kind of psychologically frustrating and it's annoying, it's distancing and it's isolating, but it's not impacting my business.

But at this point in time, if I were running a business that had in-person, I don't think I would be following the mandates. I just cannot see how I could let somebody, how I could let a government official destroy my life and destroy my business by their mandate. And so at this point in time, I would probably be putting in some kind of precautions, but I think I would try to put in some precautions, but I can't sit around and let them destroy my life and my livelihood with this stuff.

That's just kind of where I'm at. So now let's pivot to the economy. At this point, I'm pretty well convinced that we're in the beginning stages of a multi-year global – I'm going to use the word – depression. I think that we won't know, of course, whether this actually is labeled a depression until after the fact.

There's no way for us to predict for sure because basically there's no formal definition of a depression. You just know it after the fact. It's a really bad, really long recession. But I think that all of the evidence indicates that this recession that we are in the middle of or starting at the beginning of is going to be really long and really deep.

And one of the biggest reasons for that is just simply that it is global. It is a global event. And so it's going to be devastating. And I cannot see how at some point in time that doesn't have the normal expected effect on real estate values, on other values.

I understand maybe why stock markets are up when everyone's getting bailout money, etc. But I still – I can't understand the positive case right now for demand. Is there some pent-up demand? Yeah, probably so. And to the extent that you can pay everyone more money for them sitting at home collecting unemployment and then you'll stretch that out for a couple of years and who knows.

But I still think it's going to have the normal effects on real estate. And so as more and more people lose their jobs and as more and more people run out of money and as at some point in time banks start foreclosing, landlords start evicting, states of emergency are lifted through whatever means, right?

They can't continue the state of emergency just indefinitely. At some point in time, the normal economic impacts are going to apply. The basic laws of the market can be pushed off for some time perhaps, but they can't be ignored forever. They're going to have an impact. So if we come back now to your situation, on a $320,000 property, a 10% decrease in value at $320,000 is $32,000.

And so in order for you to basically pay your tax and then buy another property, you know that it's a $40,000 bill right now. But if you close on a property, then a 10% move in real estate would be a $32,000 drop. Probably something like 12 or 13% would be that $40,000 number.

I have a very hard time not seeing in most markets, I have a very hard time seeing in most markets not seeing at least a 15% decline in real estate prices. I just can't see how that doesn't happen. And I would say in the fullness of time, that's my guess.

So when I look at it, yeah $40,000 is a big bill, but your concern is relevant. The only idea that I have is, and I don't know where you are in your settled kind of family situation, but the only idea that I have is maybe you could do the move where you did, you'll just lay the idea out and you can see, but I don't know if this works with your family, but maybe you could do the move where you go ahead and identify a property that you're earmarking it for a rental, so you do the like kind exchange into a rental, but perhaps you're earmarking it for a rental, but you're choosing something that you would not be sad to move into as an individual.

You're choosing something that you and your family would not be sad to move into and would be okay with living in for a while. And so if you did that, my basic idea is that could do two things for you. Number one, it could allow you to move into it, and if you lived there for a couple of years and if the prices stayed stable, it didn't go down, then you could go ahead and sell it.

You would market it as a rental of course, so that you fulfill the agreement of the like kind, but if for some reason it doesn't work in the rental market, you can't fill it really well, you can't sell it or something, then you move into it, you convert it to a personal residence and then on the backside you sell it using the exclusion for personal residence and then you can go ahead and take your $200,000 gain tax-free under the exclusion, the 121 exclusion.

And then the second thing, the second idea about that is that if you chose something that you wouldn't be sad to live in, then you wouldn't be so frustrated about short term movements of that property and you might be happy to live there for five years and then that could be time where it goes ahead and comes back and it's just less sad and less frustrating when you're living in a house getting benefit from it if the value declines a little bit.

So I don't know if you're willing to move or if that works at all in your family, but that's the best I got. Otherwise I think it's just a matter of you looking at your market, looking at your predictions and saying is it likely that we're going to get in excess of a 12 or 13% move or is it not?

I think it's a really hard question. I would probably go in the, I'm more flexible in my outlook towards moving. If I thought that worked in my family needs, I would consider that. If not, I don't know. I just don't know. Okay, well I hadn't thought about it from that angle of a potential primary, but that adds another element of complication to it.

Yeah, but I think it's very doable. You're not required. You can convert a rental into a house to live in any time and so you need to make a good faith effort at trying to rent it. You need a good faith effort at putting it in the market. That's the terms of the deal.

But there's some interpretation available there under what it means to make a good faith effort of putting it on the market. I think that if you bought a house, let's say you did the like kind exchange and you run the numbers on it and you know that the house could go down, but you go ahead and put it on the market at numbers that work for you, well you know you've avoided the $40,000 of gain for now or the $40,000 of tax for now.

So you can go ahead and put it on the market and if you get a good tenant, you're going to be fine even if the value declines. But if you can't get that good tenant, if you can't make your numbers work, then your backup plan is just go ahead and move into it if you buy something that would work for your family.

I think it's not a bad plan. You consider it, but I think it's not a bad plan. It's worth considering. Yeah, actually, so in that situation, do you know, does it have to be rented for a certain period of time before you can make it your primary? I've never looked at it this direction.

I've looked at going primary to rental, but never rented the primary. I'm not aware of any legal requirement that it has to be rented for a certain amount of time. But what I would do if I were doing that is I would document very carefully my attempts at renting it.

And so I would very carefully document my advertising for the house. I would carefully, I would put it on Airbnb for a temporary period of time. I would make a good faith effort to rent it and I would document that good faith effort. But to my knowledge, there's no requirement that it be rented for a certain amount of time.

It's about the effort. And that would make sense in terms of the IRS doctrine. For example, many people are confused over the hobby loss rules with business deductions. And they mistakenly assume that a business has to earn a profit in two years out of five in order for it to be labeled appropriately as a business rather than it being labeled as a hobby so that exclusions of their deductions occur.

It's not the case. A business actually never is required to make money in order to qualify as a business. What is required is that the owner is running things in a business-like manner, that the owner is making a real genuine good faith effort to make a profit, and that they're genuinely doing all the things that you would do to make a profit.

And so you're adjusting expenses. You're adjusting the business plan based upon the market. So when you're in something where it's kind of on the border this way where you're understanding that this is possible, the key is you need to make a genuine effort and be able to document that.

So if you're sitting in front of a judge, you say, "Judge, look, I put it on the market. These were my predictions going through. This was my business plan. This is what we did. And unfortunately, the market conditions changed, but I made a genuine good faith effort to rent it out." And so as long as your plan involves you're actually doing that, I think you're okay.

It's fine to have a backup plan, right? Every business owner that opens a business knows that their backup plan is the business may go bankrupt. We all know that. We may go bankrupt. But the key is just understand that it's the effort that's required, and if you'll document that effort, you can create a strong chain of evidence that would support you in that decision.

Awesome. Well, I appreciate that. I appreciate your different thoughts on this. Good. My pleasure. All right, Kevin, thank you for calling in. We go now to looks like Phillip in Louisiana. Phillip, welcome to the show. How can I serve you today, sir? Hey, hi. Can you hear me? Sounds good.

Phillip, go ahead. Hey. I don't know if you remember me, but we spoke two years ago. It was a paid session, but I was 28 then. I worked for two years, and I just put in my credit cards and my student loans. And I guess I was deciding back then.

I told my parents, 40K, I was deciding back then whether to pay them or to start investing. And I guess you gave me advice to pay them with the same fervor as I paid the government and the other lenders. And so I did that. And I guess it's two years later, and I'm out of debt, completely out of debt now.

Congratulations, dude. That's awesome. Well done. Thanks. Yeah. So my last check to them, Wednesday, 10K check. And so I'm basically almost at zero right now. I have 2.5K somewhere around in places. But I guess I was just looking at plans for the future. And I know you've mentioned a lot of times about, like you were saying, if I didn't do it over again when you were sitting, you would buy a house, I guess, every year, just accumulate assets.

And so I was just basically wondering about that strategy of, I guess, buying a house every year. Let's say if I want to do that in the next six months when my lease expires. I was just wondering about that strategy and any other advice you have on building wealth.

From today's calls, we're going to have to change the name of the show to Radical Real Estate. This is the third call in a row that we've spoken about real estate. Interesting. So you are currently 28 years old, and you are unmarried, no children? No, I'm 30 now. Okay.

So your number one goal at this point in time, now that you've gotten out of debt, congratulations. First thing is don't go back into debt. Make a commitment that with the exception of an investment asset, you're not going to go back into debt. Because if you will commit that to yourself, you will always maintain your flexibility and your freedom.

You'll lose some flexibility and freedom borrowing money on investment assets such as real estate. But at least there, if you ever want out, and you're thoughtful and careful, if you ever want out, you can just simply sell the house and pay off your debt. So at this point in time in your financial plan, you now have two primary goals.

Goal number one is to increase your income massively. That has got to be your primary focus is how can I increase my income massively? Far more important than buying real estate, far more important than investing at this stage of your life is generating a very, very high income from work that you care about, with people that you like, under conditions that you enjoy.

You don't have to choose a bad job just because it makes a lot of money, but you need to choose a good job or a good business that you're well suited for and put your focus on massively increasing your income. Prior to coronavirus this year, what was your income expected to be?

What's still the same? My job is pretty stable. I basically work in a pension. I'm an actuary. I'm certified. My job isn't going anywhere really. I make 100K, I guess. I just got a raise, like land. Congrats. Good. Yeah. So my expected, I guess going into the future, my salary right now is I think 98K.

It was 88 at the start of this year, so I guess this year I'll probably make around 95K total plus bonus. And how much are your living expenses? My apartment is around 1200, including water, but I guess utilities, electricity are add-on expenses. So add everything, as far as internet or whatever, it might be around 1400.

Besides from that, I don't have any other expenses. I have two old cars that I fix whenever one breaks. They're both 20 years old. One's a 99, I think, CRV. Another one's a 2002 Honda CRV. So let me cut you off for a moment. I live pretty frugally. Good.

All right. So what that means, if you live pretty frugally, if you've got $100,000 income and you've got to say $30,000 a year of personal expenses, then you should be able to save after taxes something like 40 to 50 grand a year. Does that sound about right? Yeah, if I really push it, yeah.

All right. So if you can save 40 to 50,000 dollars a year, you're doing awesome. And that's going to quickly allow you to pile up money for investing. So back to kind of my guidelines. Number one, most important thing is increase your income. And so congratulations for making a six-figure income.

You should still look at that and study your career and study your income and ask yourself, how can I 10x my income over the next 10 years with career moves that I'm going to be excited about? How can I 10x my income over the next 10 years with career moves that I'm going to be genuinely excited about?

I'm not trying to get you into a job that you don't like just because it makes a lot of money, but very few people ever set out an income goal. And that's why very few people actually make a lot of money. So the first thing you can do is set an income goal that you have and then work on how you can achieve it in a way that upgrades your lifestyle, in a way that gives you something really exciting.

Because if you can go from 100,000 dollars a year to a million dollars a year and you can keep a 30 or 50 or 70,000 dollar a year expense ratio, it's a lot easier to get wealthy really quickly. Agreed? Agreed. I get it. All right. You're an actuary. You run the numbers.

Imagine that you go from 100,000 dollars a year to a million dollars a year. It's a lot easier to get wealthy really quickly. So think about that. Now you don't have to always do that, okay? But you do have to think about it. You may come to a point where you say, "I've got a great job.

I'm really well suited for this job. I really like it." And you may come to a point where you turn aside from a goal of always increasing your income because you've decided that for right now what you're doing is the best for you. But from a wealth building perspective, before you ever think about investing, you should go back and look at your income.

Because investments in your income are almost always the best investments you can possibly make. So don't forget about that. Just because you got your actuary certifications, just because you got a college degree, just because you did that doesn't mean that you should stop investing in your income. If you'll go from $100,000 a year to a million dollars a year, it'll be a lot easier to become wealthy.

Now, number two. Number two is you keep your expenses low. And so you're doing a great job. And so going forward, if you will maintain your low expenses, especially while you are single, especially while you're in this situation where you are flexible, if you'll keep your low expenses, you will pile up income massively.

You haven't had a chance yet because you've been paying off the debt. You haven't had a chance yet to experience the joy of saving $40,000 or $50,000 in a year. But it's awesome because now that you've gotten your income up to six figures and you keep your expenses low, you can go to a point of saving $40,000 or $50,000 in a year, which means that your worlds open up in a way that you haven't experienced yet.

And this is what's so frustrating about kind of your 20s is that the modern concept, and I don't remember all the details of your situation. I'm speaking generally. But in general, what many 30 year olds would have experienced is that you go through this rough, tough, expensive period of life.

You graduate from high school, you got no money and they say, go to college. You go to college, you start borrowing money. Maybe you take out some credit cards or you just do stupid stuff and you go into debt. You have student loans and then you finally get out of college.

You get your first job and it's an entry level job. So you're not making a ton, but then you work at it and you increase your certifications. You're taking lots of extra classes. You're passing actuary exams and then boom, finally, now you got $100,000, but you want a year of income, but you only got $2,500 to your name because you've been working to pay off debt.

That makes you far ahead of many other people, but you haven't yet had the joy of piling up money. And so the next step is keep your expenses low and experience the joy of piling up money. If you need to upgrade anything in your life, that's a really big deal.

You need a car that's a little bit better or something like that. Make a note of that. But keep your expenses low so you can save money. And then the most important thing when you're moving to investing is saving money, is having investment dollars. But at the beginning of an investment career, the thing that drives your results is not the rate of return that you can earn on your investments.

It's the amount of money that you can save for investing. And that's driven by income and expenses. So you're doing awesome. Keep up that good work. Now let's assume that you've decided that real estate is a good fit for you. You shouldn't necessarily decide that hastily. I still believe that for the majority of people, if you have an inclination towards some form of entrepreneurship, if you have an inclination towards something like that where you can move into a job where you have more responsibility, where you can profit from it more, it's be far more profitable for you to do that than to just simply own real estate.

But if you've decided that you're settled in your job, you're settled in your career, this is a good fit for you, then real estate is a really good mixture of a business and an investment. And so the nomad strategy that you're alluding to is dirt simple. Basically you buy a house and you just buy the house just like a standard house.

You buy a house. You go around, you look around, you find a house, you get a mortgage and you buy a house and you move into the house. Then you can house hack it. If you're single and 30 years old, it works really well. Get a couple of buddies, buy a three bedroom house.

Maybe your mortgage payment is going to be $1,500 a month, but get two buddies that you rent out two rooms to for $650 a month including utilities and that covers you and drops your personal living expenses from $1,400 a month down to maybe $400 a month or $500 a month, something like that because you took the risk of buying the house.

So you buy a house, you live in it and then after a year, you'll have satisfied the requirements of a residential mortgage. Then you go ahead and you buy another one. So you buy another house and you rent out your first house and you move into the second one and you get your buddies to move with you.

You say, "Listen guys, I know it's a hassle to move, but I got another great house. Would you come with me? I'll move your stuff for you. I'll pay for the mover so it's not such a big deal." You move them in with you and you rent out the first house.

And then basically you repeat that as often as you want. You can buy more houses other than what you're just living in, but the once a year kind of scenario works really naturally and if you need a place to live anyway, it works out really well. The great thing about that system is that you can just do traditional residential financing.

You're buying a house as an owner-occupant. It's a little easier. It's just what you're accustomed to. But if you do that for about five years and you pick up something like five rental houses, then you get yourself in a situation where you're 35 and now maybe you're married, maybe you got a baby or something like that.

You say, "Okay, now I'll go ahead and pick the house that I want to live in." So you move again and you move into the house that you're going to live in for a while. And then you just fast forward and you let your tenants pay off those mortgages for you.

And if your tenants pay off your mortgages for you over a course of 20, 25, 30 years, then 20, 25, 30 years from now, you're sitting there with a paid off real estate portfolio that may be making you, if you got five houses at $1,500 per month, you've got a gross income of something like $7,500 a month and now you're by most considerations financially independent, financially free based upon your real estate income.

And so based upon your numbers, if you can earn $100,000, pay $25,000 of tax, that gives you $75,000. If you can live on $30,000, that leaves $40,000 available for investing. If you can save $40,000, then every year you can make a down payment on a house, a $30,000 or $40,000 down payment on a house if necessary, depending on what your local market is like.

And so you can comfortably save the money for a new down payment every single year. And what you got to make sure of is that the whole portfolio cash flows along the way where your rental income is at least as much more than your mortgage payment and other expenses as possible so that you have some safety.

But as long as the portfolio cash flows and as long as you have the ability in the case of an emergency, right, coronavirus comes along and all of a sudden you got to just pay all your mortgages out of pocket, then you have the ability to do that out of your income and out of your cash flow.

So that's the basic strategy. And if you'll do that and commit to that for a few years, it can be extraordinarily productive because once you own the houses, now you need to manage them, but your tenants are now paying off your mortgages for you and your houses may increase in value.

What is frequently the case is let's say you buy a portfolio of five or six houses, you fast forward 10 or 15 years, your mortgages are paid down, but maybe all your houses have appreciated in value. And so what you do is you sell one or two of the houses that you don't like anymore.

And by the way, the little hack that I mentioned to the previous caller about moving into it, if you're still flexible enough and you can move into one of those houses, you move into one of the houses, you live there for a couple of years, and then you go ahead and sell it and take the exclusion on the sale of the gain, $250,000 for a single person, $500,000 for a married couple.

You go ahead and sell that house, take that tax-free capital gain if you moved into it. Otherwise, go ahead and sell the house and pay the tax, and then you pay off the mortgages on a couple of the other ones. And so if property prices appreciate, which is a possibility, it's not a guarantee and you don't want to depend on it, but it's a good distinct possibility if you're really wise with where you buy and when you buy, if property prices appreciate, then you can get yourself in a situation where a 15-year plan is very reasonable, where you pay off a couple of the houses, they appreciate enough that you can finish paying off the mortgages, and now you're left with three or four houses completely debt-free because you used appreciation to pay off the rest of them.

And so a plan like that is a very reliable plan towards financial independence at an early age, and it complements really well a high, stable income because the high, stable income makes it easy for you to plan. And so if you put those three pieces together, keep your income high and work on getting it higher, keep your expenses low and keep them low, and then number three, invest aggressively into something that's well-suited for you, then you're on the fast track to financial independence.

Awesome. Definitely. Yeah. I guess my goal, I guess, is to, I guess, is stability. I guess more than it is, I guess, just like, I guess, trying to maximize my income. What do you mean by stability? I figure just having, I guess, only three houses, renting those out, that'll run with them stability, I guess, in any situation.

I mean, as far as what I do, I don't mind what I do, but I think my goal would be to teach or do something more hands-on than, I guess, just stare at a screen for like 30 years or something. Sure. Sure. Well, at this point in time, the best thing right now in the middle of this current emergency, keep your job, right?

Even if you don't like your job, keep your job and save some money. So, get as quickly as you can to several tens of thousands of dollars in savings and enjoy what that feels like of having tens of thousands of dollars of savings. If you're not sure kind of about what's next, just save money, save money and look forward to the future and work on those plans.

You have the ability. So, if at any point in time you decide, "You know what? I don't want to be an actuary. I want to be a teacher." Well, now that you're out of debt, you have the ability to pivot and do that. You can do that in any context.

So, that's what getting out of debt bought for you. It bought you freedom. And so, I want you to enjoy that freedom and to go in the direction of the life and the lifestyle that you'll be happiest with. If you're not sure if you're going to continue in your career, then slow that plan down that I said.

You know, slow it down. But if you want to continue your career and you keep your income up, then that plan is very, very feasible. And as long as you can save some money first, you need to save money and have it to do the plan to be a real estate investor.

You need to have the ability to absorb unexpected expenses. You've got to have cash. You've got to have the ability to absorb three empty houses in a month because nobody's paying because they all got laid off from coronavirus. You've got to have the ability to pay for a new AC.

You've got to have cash. And so, you need to take some time and study this out and think it out. But I'm not going to say to you, you've got to just prioritize money if you've got a different dream. But I guess in closing, save money. Congratulations for getting out of debt.

Save some cash and then we'll see where we go from here. All right, we'll go to Brittany in Texas. Brittany, welcome to the show. How can I serve you today? Hi, Joshua. Thanks for taking the call. My pleasure. So, I wanted to talk to you really about starting a business and doing that while being a W2 employee, something that's always been kind of knowledge.

And I really appreciate your transparency and monetizing knowledge work, what you've done to pivot over the years to try different models of doing that. And just wanted to discuss your thoughts on really everything from narrowing your market, finding your client base and monetizing knowledge work. Okay. Do you want to ask a question or you just want to kind of a monologue on it?

I'll give you a context maybe for a monologue. Please. I do like your monologue. So, I'm a W2 employee. I work in corporate finance. Also, very passionate about personal finance. And I'm working towards having a few certifications that I think could help kind of prevent imposter syndrome and validate the background to help with small business consulting.

Specifically, a CMA, certified management accountant, MBA, I'm currently a candidate and a CTP, certified treasury professional. And my background is a degree in finance and international business. Married, no kids, W2 employee at a large multinational corporate, we'll say. And wanted your discussion around the value of adding letters, especially whenever trying to break into consulting work or a new industry.

And then also just kind of around clarifying that business idea. What does that look like? Do you have good resources? You've recommended a lot of great books over the years. And then also how to differentiate. Highly compensated for my existing work. Investing in my current career versus investing in starting a business from a time and energy perspective because I could see my life going either way.

Moving up in the corporate world, starting my own business and allowing that to grow or even moving to a smaller company and having a larger role, say, as treasurer or CFO. How old are you? I'm 28. Okay. Well, I'll give you a couple of things to think about that I think are important.

Number one, the most important thing when starting a business, in my opinion, is clearly identifying a specific customer that you can market to. And that I think is the hard part because generally you don't want to narrow down. But you've got to identify a specific customer that you can market to.

And so if you're going to go out and build a knowledge business, the question is who specifically are you targeting? Who are you going after? And if you cannot identify one person specifically, then it's very hard to make enough noise in the marketplace to reach that person. And so I'll use, you've listened to my work and you've made complimentary comments.

I could not start Radical Personal Finance today and have it succeed because it's too general. I could not do it. The marketplace is too crowded. The brand is too broad. It's too general. I could not do it today. If I were starting over today with some kind of personal finance brand, the only way that I would be able to find enough listeners to make a difference is to narrowly identify one specific segment that I'm trying to help.

Now I can expand out after that, but what you see if you compare, if I compare my brand to some other brands in my space, that brands that are more narrowly focused are far more successful. So for example, the work that Jonathan and Brad do at Choose Fi, their brand has gone through the roof.

It's far bigger than mine is now. I had them on Radical Personal Finance right when they were getting started. I like to think that I kind of helped give them a push and sent a few listeners their way, but their brand is far bigger than mine is now because they chose one specific niche.

They chose the financial independence niche. And so that's a good example because when people go looking for financial independence, they're now referable to that. And so the same thing happens in your business. Any brand you're going to start, whether it's consulting with people from a corporate finance perspective or a personal finance, you have to be focused on a niche.

If I tried to start again today with Radical Personal Finance, it would be a complete failure because no one would find me. No one would find me fast enough and my brand is too non-referable. It's like, "Well, what's the show about?" "Well, Joshua talks about stocks sometimes and real estate.

He does these Q&A calls and he talks about modern portfolio theory." How do you describe it? Right? If they're my listening base, if they're my listeners, they really like it. But the reason that I got it started was because when I started, it was a timing thing. There was a broad market, there was an empty market, and I knew that there was an opportunity for someone to come into that market and that's what I wanted to build.

I didn't want to be bored left, right, and center. I used to own all these domain names for these very niche podcasts like Backup Plans. I had Social Security Podcast and Podcasting for Financial Advice, all these different brands that I had lined up that I could go with because they were better marketing fits but I didn't really want to do them.

But the point is, be honest about your market and recognize that what works for somebody at a certain point doesn't work for everybody along the way. The key is to be able to niche down to the point where when your prospective customer hears you, they immediately know you're talking to them.

As specific as you possibly can be is the key. That helps you with step number two is how to find the customer. One of the biggest problems that you face with a business is where are you going to find your customer. If you don't know who your customer is, you don't know where to find them.

If you're focused on CEOs, that's too broad, right, because you don't know where to find CEOs. Is it CEO magazine? But there's a big difference between CEOs of Fortune 100 companies versus CEOs of plumbing businesses in small town rural America. Both of those are CEOs and I can find both of those people if I've got a business that can serve them but I can't find CEOs.

That's just too broad. Once you can identify who your customer is, that allows you to go and find them with your marketing message. Then when they hear about your content, they hear about your blog, they hear about your brand, they hear about your podcast, they read about the title of your book, they say "That's me." You want them to immediately say "That's me.

That's me. That's what I want. That's me." That to me is your single most important thing is to clearly identify who you want to work with, have some sense of kind of how you're going to work with them so that you can go and find them. And then once you can find them and start putting stuff in front of them, then you can start listening to them and see what they want.

And then you just give them what they want. But you've got to begin with who do I want to find and then listen to them of what do they want. Now, to your question on like designations and whatnot. Designations might be important, but I think they're most important for you, not for your customers.

I have a lot of designations. I used to have more. I've dropped several of my designations. I haven't maintained my CFP designation in a number of years. There was a time in my life when that was really important to me. I keep meaning to call the CFP board and go ahead and go through the reinstatement process, but it's just it doesn't matter to me anymore because I am at a place where I know I'm more confident in who I am and what I know.

Whereas when I go back when I first started studying for the CFP exam, I didn't have that confidence and I didn't know what I didn't know and I was scared of everybody and I just didn't know like how can I help. And so for me, the process of designating up was probably more about me than it was about my customers and my clients.

Do people respect designations? I think sometimes, but I have no idea what a CTP is. You know, I'm in the finance business. I've never heard of a CTP designation. And so if you handed me a business card that says Britney, you know, CMA, MBA, CTP, the only one of those that I know about is the MBA because that's a famous one.

But if it says MBA, I don't know if it's an MBA from a big fancy prestigious school or if it's an MBA from an online night thing that you did in three months. I have no idea. And so the beauty of content marketing is that you can shine through and depend on the value of your ideas far more than the value of your designations.

And to me, that's the beauty of content marketing. If I could have as a financial advisor, if my firm had allowed me to build media the way that I build it now, I would have had a huge business because people can assess who I am by hearing me speak.

And to me, that's a far better resume than the number of titles on my business card. So are designations valuable? I think they're valuable. To me, the biggest value of designations is it makes it easier to get a job. So one of the reasons why I keep meaning to go ahead and reinstate my CFP, one of the reasons why I have those designations is just simply what if I go bankrupt?

You know, if I go bankrupt and I need a job with my, you know, Joshua J. Sheets, CFP, CLU, CHFC, you know, CASL, RHE, REBC, CAP. I think like when I put that on a resume, I can put that resume in any stack and there's nobody that has more designations than I do other than Michael Kitsis probably now.

But you know, I can put that resume in a stack and they're going to look at it carefully because they're going to say, "Well, I know Michael Kitsis has as many designations as Joshua does, so let me at least talk to him." So that's how I see designations. Designations do two things for you.

Number one, they may increase your confidence and cause you to just feel more confident in the marketplace and that's infectious. When you feel confident, your clients will absorb that. And so if you need those designations in order to feel confident, get them. And then number two, is there a great backup plan?

They make it easier for you to get hired for a job if you just got to make your resume stand out in a stack of papers. But do you need designations for content production? Probably not because when you're doing content, you have the ability to just simply rely on the quality of your ideas rather than relying on your designations.

All right, that's helpful. Do you have any guidance on what to consider whenever thinking about managing your energy between growing your current income, you know, if you have a highly compensated W2 career versus the potential returns on a nascent business? I guess there's probably two ways to do it.

Number one is what are you excited about? So if you're really excited about the W2 career, then I don't think you walk away from it. You focus on it. If you've got a lot of room to run, let's say you're making $200,000 a year, but you see that this W2 career could go to $800,000 a year with the right moves and you'd be excited about that, that's a big, big move.

And I think that a lot of times it's a lot easier to do that in a career than it is starting a business. Business, when you're starting a side business and a content business, it takes a while to get your legs under you. And so from a financial perspective, if I'm advising you as a financial advisor, unless you hate your job, I'm going to say what opportunity do you really have here in your day job and let's not just despise it.

Because five years of major income growth from you being 28 years old, from 28 to 35, seven years and you can add an extra hundred or a couple hundred thousand dollars with some right moves on your W2 job, you'll probably make more money doing that than building up a new business, especially if you're starting from scratch.

And so I don't want you to walk away from your job unless you hate it, unless it's just terrible. In which case, all right, fine. You can convince me. But from a financial perspective, if you're okay at your day job, good. So give that puppy some time to run because being able to make a lot of money on somebody else's risk is awesome.

And if your expenses are low and you can save a lot, that can set you up for financial independence and can make starting a business far easier. I bootstrapped all my businesses. But let me tell you, I don't ever want to bootstrap a business again. There's a place and a time for bootstrapping and I'm into it.

Like, hey, I'm not going to sit around and waste time. But I don't ever want to bootstrap a business again because man, it's a lot of work. And the older that I get, the more I start to feel like a creaky old man when I'm like, I don't know if I could do it again.

I don't know if I have the energy. I don't know if I have the enthusiasm. I don't know if I have the passion. You know, there were times when I was a new financial advisor, I was in my office at 4 a.m. There were times I was leaving my office at 2 a.m.

and just because I had the energy. Today, I couldn't do it. Now, I'd like to think that I could still be really effective because I got a little bit more wisdom now and a little bit more confidence. And so what I didn't have at 23, I do have now, which would make a difference.

But I also, I increasingly kind of feel that question of, I wonder if I could still do this. You know, right now in the stage of life that I am, I can't do 70 hours a week. I can't. I've got too, it would cost too much in my life for me to do 70 hours a week.

So I got to be effective on 40. But you're still, you know, in that stage where you can do both. So I would not run away from a W-2 income. What I would try to do is I would think about a strategy that allows me to do both. And so take an honest assessment of the new business and say, how much time can the new business produce?

How much effort, you know, how much can I do with the new business? And can I make it work on 10 hours a week? Can I make it work on 15 hours a week? So if you do 40 to 50 at your day job and you can do 10 to 20 on your side job, I think that's really reasonable.

I think 60 hours a week is, 60 to 70 is a really reasonable, consistent work week that you can do as a single woman. And so if the numbers would work that you can be effective enough at your day job with 40 to 50 hours and you can be effective enough with your night job with 10 to 20, I think something like that would be good.

And it'll give it time to see if the side business has legs. I would never advocate, so what I did, I do not recommend. I had to leave financial services. I had to close my business. I had to walk away from a lot of money. I lost pensions. I walked away from residual income.

I walked away from all of it. But that was exclusively because of the stupidity of the financial services industry and the onerous regulations. In any other industry, I think that's a foolish move. I think that unless it's absolutely required, do not walk away from the cash cow until you're sure that the side business has legs and you're really sure you want to do it.

And to me, a good metric of being sure is how much am I willing to work on this early in the morning, late at night, on the weekend, etc. How much am I really willing to work on it? Because if you're willing to work on it a lot and it starts to show some legs and starts to show some financial potential, then you'll feel good about walking away from the day job because you're really excited about it.

But if you find that you're too tired and you're not going to build up the side thing, well then, now you know that probably better to stick with the day job and make the money there. All right, that's helpful. Last question, where can we sign up? I know you do some one-on-one consulting, but I don't recall how to sign up.

Email me. Joshua@radicalpersonalfinance.com. Email me. It's not on the website. You have to email me for details. Great. Thank you. Thank you, Brittany. All right. We are going to do something that Joshua is not very good at. I've got four callers on the line and I've got about 10 minutes that I have to wrap up.

So we're going to do rapid fire. So we go to Pottstown, Pennsylvania. Welcome to the show. Go fast with your question. We're going to do rapid fire and you can call back next week for more conversation. Hey, Joshua. Go ahead. Can you hear me? Yep. Go fast. Okay. I just was curious.

Based on your advice like 45 days ago, you were like, "Hey, stock up. Get ready. Be ready for this kind of stuff." And I still see problems in the supply chain and you read about stuff about new packing places closing down and things like that. How do you evaluate that sort of information and know what kind of moves you might want to make in this kind of weird time right now?

Got it. You think about what's in your life, what you actually need, and you think about what the risk to you would be if you weren't prepared for it and then you move accordingly. So nothing has fundamentally changed in the last 45 days that would make me more optimistic.

The specific concern is that it's progressing slowly. And so what you do is you say, "What's the cost to me of stocking up? What's the cost to me of being prepared?" And with things like food or shortages in the supply chain, the cost is basically nothing. You simply buy the stuff that you're going to use anyway and you stockpile the stuff that you're going to use anyway.

And that way you're protected if everything goes bad. But yet if nothing goes bad, you still use the stuff. That's why stockpiling is such an absurdly simple strategy and it's always the right move because it works both ways. You don't have to be right. And so if you're pessimistic about shortages in the supply chain, you're pessimistic about meat disappearing off the shelves, you're looking around and you're reading a story and you say, "I don't know if this is true or not." And just ask yourself, "If it were true, what would I do and what would the cost of that be?

And if it were not true, what would I do and what would the cost of that be?" And so for me, if I've got the money and I'm worried about supplies of meat drying up, I'm just going to stock up. My freezer remains completely full of meat and my pantry remains completely full of food.

And I feel great about that because there's no downside whatsoever. If everything continues to go bad and the shortages are right and all the fear mongers are right, which they certainly could be, then I'm going to be better prepared. And if they're wrong and the optimistic case is actually the right case and, hey, it was all an overreaction, no big deal.

I'm going to eat food that I would have consumed either way. Now that's different than a big investment decision. That's different than making a bet on the direction of the market. That's different than making a bet on real estate or something like that. But that is the truth. All right.

Everyone jumped off because they heard my rapid fire, except New Jersey. New Jersey, welcome to the show. How can I serve you today? Hey, Joshua. I'll ask you my rapid fire question first. Getting married soon, do you think it's a good idea to set up some type of business LLC to manage the number of contractors that I'm going to have to hire?

For the wedding? Yeah, for different services. Like to limit personal liability as well as kind of shield myself a little bit. I can't see the risk that you would personally incur why that would at all be necessary. I can't see why that would be worth the hassle. If you're renting a facility and you're hiring a florist and a photographer and a preacher and a caterer, etc., I just can't see the liability exposure that you have that would make that necessary.

So my answer is no. I don't see the benefit of it. Okay. Thank you. You said you had another one. I did that one in 45 seconds. So go ahead. Yeah. So I took your career and income planning course and I wrote out kind of my plan. And what I came up with was I want to invest in people whom I can have a high influence with and a high impact using their skills and ideas in niche areas.

And if this goes too long, I'll call back next week. But the primary idea was to employ someone in my family who has extensive experience in the child care industry and trying to set up a Montessori or Waldorf type school, particularly in the Southeast. And this would be my first venture into business.

And I'm wondering, where do you think is a good place to get started with that? The best place to start with that. So Montessori and Waldorf would have their own marketing attraction in certain environments. But what I would say the best place to start with that, go read Nick Kozel's manual that Gary North publishes on his website, GaryNorth.com.

You'll have to sign up and become a member and then he's got it somewhere in his downloads. But Nick Kozel, years ago, North got him to write a manual on how to start a daycare, basically on the cheap. And that has always been, when I read that manual, it persuaded me that it's a good potential business.

And so that to me would be a really good place to start, could be very profitable. The basic outline of the idea is you go to churches that have facilities that are not being used during the week and you make a deal with them to use those facilities during the week to provide daycare services.

And so what I would do is I would start with that and then I would set up the next stage of schooling for the daycare children to matriculate into. And I personally would not, if you find that Waldorf or Montessori branding is appropriate for you, and it's a draw, I think it would be a draw, I would not personally brand as that.

I would rather go ahead and get rid of the baggage of those two identifiers and just simply build my own brand in a local area. Because if I built my own brand, then I can have more leeway with the type of things that I build and probably more financial opportunities.

I do think there's a real opportunity for for-profit schooling. And I'll call in next week and we'll chat about some ideas. I don't know, I have not tested them in the market, but I'll give you all my ideas and you can see if you can test them in the market and see if people would actually buy them.

Will do. I'll call in next week. Thank you. All right. Thank you everybody for being here for today's Q&A show. I've got to go for today. Got a bunch of questions and if you'd like to join, a couple things that some listeners have alluded to and let me give you some info on those.

First of all, if you'd like to join me next week, go to patreon.com/radicalpersonalfinance. That's important. Patreon.com/radicalpersonalfinance. I do a small amount of individual consulting. I've got some time in early May now, but if you'd like to reach out to me for individual consulting, send me an email, joshua@radicalpersonalfinance.com. Sometimes I'm 10 minutes behind on email, sometimes I'm 10 days behind on email.

The only way I know how to manage my life and business is sometimes I walk away from communications and I focus on getting stuff done. And so if you don't hear back from me immediately, I promise you will hear back from me, but send me an email, joshua@radicalpersonalfinance.com if you're interested in consulting.

Some listeners have referenced some of my courses. I have a course on how to borrow money safely and never pay interest using credit cards. You can find that course at radicalpersonalfinance.com/store and every single one of you who has a credit card or who will ever have a credit card needs that course.

So the only people who don't need that course is if you're firmly convinced I'm never going to have a credit card, don't buy it. But if you are, then if you have one, then go to radicalpersonalfinance.com/store and sign up for that course. And then finally, I do have a career and income planning course.

The single biggest decision that you can make that will influence your life positively and help you live a rich life now while building a plan for financial freedom in 10 years or less is going to be to optimize your career and your income choices. What you want to do is you want to build a career based upon something that you really are thrilled about doing and do it in a way that's insanely profitable.

And in that context, you have the ability to enjoy your life now, enjoy the impact of your career while simultaneously building a massively profitable career which opens up fascinating groups, fascinating opportunities for you that nothing else does. Trust me, it's a whole lot easier to become financially independent very quickly if you make a million dollars a year versus a hundred thousand.

It's a whole lot easier to become financially independent quickly if you make a hundred thousand instead of thirty thousand. And so bar none, I have almost never talked to somebody where the first thing that we didn't talk about was how can you increase your income while maintaining and improving your lifestyle.

And the single best way to do those two things together is to build a career that you don't want to retire from, to build a career that you're excited about that has opportunity. And so if you're interested in that course, go to radicalpersonalfinance.com/store and you will find that there.

Thank you for listening. I'll be back with you next week. Or yeah, next week. If you are looking for an exciting role in customer service, food service, or retail, connect with a job at the airport. Get started in a role that offers competitive wages, consistent schedules, and fast-tracked in management while you work in a vibrant, exciting environment where security is a priority.

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