Afford Anything | Make smart choices about your money, time and productivity

By Paula Pant – Entrepreneur, investor, and world traveler (40+ countries). Self-proclaimed nerd

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Ed Frizzell
 Jul 22, 2018
I like this podcast. I find it very informative. occasionally I sense political ideology creeping into the content. That's the reason for 4 vs. 5 stars. This seems typical with Millennial podcasts. Keep up the hard work!

Description

You can afford anything, but not everything. We make daily decisions about how to spend money, time, energy, focus and attention – and ultimately, our life. Every decision is a trade-off against another choice. But how deeply do we contemplate these choices? Are we settling for the default mode? Or are we ruthlessly optimizing around a deliberate life? Host Paula Pant interviews a diverse array of entrepreneurs, early retirees, millionaires, investors, artists, adventurers, scientists, psychologists, productivity experts, world travelers and regular people, exploring the tough work of living a truly excellent life. Want to learn more? Download our free book, Escape, at http://affordanything.com/escape

Episode Date
#146: Ask Paula - Where Should I Keep My Money if I Want to Retire Early?
01:04:15

My friend and former financial advisor, Joe Saul-Sehy, joins me to answer a multitude of questions on retirement savings and investing, so let's dive in.

Elyse has two questions:


#1: Through her job, Elyse has a 401(a) hybrid. Right now, she contributes 0.5% as her employer will contribute 2.5% only when she contributes 4%.

Should she contribute the full 4%, or keep her contribution as low as possible, save it, and invest it on her own (which is what she's been doing)?

#2: Elyse also has $18,600 invested in a mutual fund through her bank. Everything that she has read says to invest in index funds. So, should she pull her money out of the mutual fund and into Vanguard to avoid high fees?

Anonymous also has a few questions:


She has a 9-year job history with the state and local government, during which she has been enrolled in the Florida pension plan.

Her new job offers a 457 Plan and/or a 403(b) Plan to supplement the pension earning.

Her first question is: is a 403(b) better than a 457 Plan? Or should she enroll in both?

Second, in her most recent job, she had a 457 deferred compensation Vanguard account which has $22,000 in it.
Should she roll the Vanguard account over into one of the above plans, or leave it alone?

Lastly, she has a 3-month old and wants to put a lump sum of $10,000 toward an account she can make contributions to, but she isn't sure which account would be best. Florida has a pre-paid program, but are there better options?

Rachel has a question on retirement accounts as well!:


Rachel recently left a government job where she had a TSP. In addition to that, she also has two IRAs - a small traditional IRA and slightly larger Roth IRA. She's actively contributing to the Roth IRA.

When she left her job, she started an S-corp, and as she looks forward to business picking up, she wants to know how to best organize her retirement savings moving forward to make it easier to manage. She's also interested in tax optimization.

What actions do we recommend she take?

Stephen, a new listener, asks:


If we're following the 4% rule route, does it make sense to fund an HSA, Roth IRA, Traditional IRA, or 401(k) at work? Or should we put all of the money in a Vanguard fund?

Essentially, if you're planning to retire in 10 years or less, which is more beneficial: splitting up your money, or focusing on one account?

P.S. If you have a question you want me to answer on an upcoming Ask Paula episode, leave it here!

Aug 20, 2018
#145: How I Paid Off $500,000 in Credit Card Debt, then Launched a Company with $35 Million in Annual Revenue -- with Rand Fishkin, Founder of Moz
01:07:50

When Rand Fishkin was 25 years old, he carried $500,000 in credit card debt.

Less than a decade later, Rand was the Founder and CEO of a company that grossed $35 million in annual revenue.

In this podcast episode, Rand shares the story of hitting his financial rock-bottom and making the ultimate comeback.

_______
The saga began in 2001, when then-22-year-old Rand dropped out of his senior year of college to grow a business with his mom.

His mom Gillian owned a small marketing company that helped local businesses with tasks like placing ads in Yellow Pages. (If you don't know what that is, ask someone over 30.)

Rand had an early entrepreneurial streak, and had spent the late 1990's and early 2000's working part-time for his mom's business. By his senior year, he was ready to dive in full-time.

Gillian and Rand both realized the internet was more than a passing fad. Households were switching from dial-up modems to broadband connections. Clients were more interested in websites than Yellow Pages ads.

The mother-son duo decided to start designing websites for local businesses.

From 2001 to 2004, they hired contractors, rented office space, hosted booths at conferences, and purchased advertising. They paid for most of this with personal credit cards in Rand's name.

By 2004, they'd accumulated $150,000 in credit card debt. Then they defaulted. They couldn't make the minimum payments anymore.

The interest and late fees grew this balance to an astronomical $500,000.

They decided not to declare bankruptcy. Instead, they took a two-pronged approach: Rand's mom spent the next three years negotiating with creditors, getting big chunks of the interest and late fees waived in exchange for making payments on the principle balance. Meanwhile, Rand focused on growing the business.

Several of his clients needed help with a specific aspect of internet marketing called search engine optimization, or SEO. Rand began researching SEO tactics and started a blog to share his findings. This blog attracted new clients, and soon Rand developed a reputation as an SEO expert. He created a company called SEOMoz, later rebranded as Moz, to offer consulting services for businesses.

After a few years, his company started developing and selling subscriptions to SEO software tools, as well.

By the time Rand stepped down from his role as CEO, the company had raised multiple rounds of funding and was collecting $35 million in annual revenue.

But there's a difference between a company's earnings and the personal income of its founders. Today, Rand and his wife still have a liquid net worth that's less than one million.

How did Rand transition from carrying $500,000 in debt to becoming the founder and CEO of a successful eight-figure company?

Why isn't he a millionaire yet?

And what lessons about entrepreneurship and finance can he share with the world?

Find out in this podcast episode.

___

P.S. Rand's wife, Geraldine DeRuiter, is a hilarious travel writer and an alumni guest of this podcast. You can listen to her interview in Episode 77.

http://podcast.affordanything.com/9-years-nonstop-travel-geraldine-deruiter-everywhereist/

P.P.S. If you'd like to learn more about starting a blog, check out this free tutorial.

Aug 13, 2018
#144: Ask Paula - What Do You Think of Real Estate Crowdfunding?
44:35

Today I’m answering your real estate questions!

First up, Rich asks:
What are your thoughts on real estate crowdfunding versus investing in a traditional REIT and non-retirement account?

He doesn’t want to give up the time it takes to manage a rental property. He wants to spend more time with family and friends, and his eventual goal is to generate enough passive income to transition into becoming a social worker.

Rob asks:
As a real estate investor who also invests in index funds, how do I decide what percentage of my net worth to allocate towards the stock market versus real estate?

Anonymous asks:
How do you maximize value in real estate? Is real estate worth the sum of its parts? Should you strip out some of that before you sell a property to maximize its value?

Laura asks:
How did you develop your real estate course? How do you market a course?

I answer these questions on today’s episode of the podcast.

Enjoy!

For more information, visit the show notes at http://affordanything.com/episode144

For more details, visit the show notes at http://affordanything.com/episode144

Aug 06, 2018
#143: Life After Financial Independence - with millionaire investor Emma Pattee
52:26

Emma Pattee became a millionaire at age 26. But she hates it when I describe her like that.

Here are other ways that Emma would prefer to be known: She's thoughtful. She's hilarious. She's kind.

Emma is the child of hippies. She grew up in a tent in Oregon, at least for a portion of her childhood. She has a BFA in writing from Emerson College.

She bought her first house at age 21. At the time, Emma was juggling a demanding full-time job with her ambitions of becoming a writer. This balancing act felt too tough. She felt motivated to quit her job as quickly as possible, so that she could devote her time to writing.

She moved in with her boyfriend's parents, saved 70 percent of her income, and contemplated what to do next.

She decided to "buy a small house in a not-so-nice neighborhood, and live for free by renting out enough rooms to cover my mortgage and make a little money on the side."

But then she developed an addiction to real estate.

She kept buying houses and converting them into rental properties. She DIY'ed some projects and hired contractors for other projects. She improved the homes and raised the rents. She reinvested the cash flow into buying more houses. She borrowed against the equity and bought even more houses.

And that's how Emma, by age 26, became a millionaire.

Her seven-figure net worth -- and more importantly, the cash flow that accompanied it -- allowed Emma to reach financial independence. She could stop trading her time for a paycheck.

Emma quit her job at age 26 and dove into the world of self-employment, starting a lucrative one-woman enterprise as a professional ghostwriter. She writes books and articles, for which her clients receive authorship credit. In exchange for this effort, Emma makes a substantial amount of money.

So who is Emma Pattee? She's a financially independent millionaire real estate investor who started a lucrative self-employment business as a writer. (Sound familiar?)

Among the many words in that sentence, the most important word, to Emma, is the word "writer." That's why she started down this path. She wasn't trying to become wealthy. She wanted to become a self-funded artist. She wanted, simply, to write.

__

Emma is a close friend. She was my guest of honor, my Plus One, when I delivered my keynote speech at the World Domination Summit last month. She's my travel buddy and real estate investing companion; we visited Alabama last year to check out potential investments in Birmingham and Montgomery. She and I have talked about meeting occasionally for writing retreats.

In today's episode, Emma and I sit down at her dining room table, plug in a microphone, and hit "record." In the 30-minute conversation that follows, we talk about how and why we reached financial independence -- and what comes next.

Enjoy.

Aug 03, 2018
#142: How Can We Downsize from Two Incomes to One?
57:17

How can a family of four shift from earning two incomes to one, while still pursuing financial independence?

How would a 55-year-old couple with $2 million saved know if they're ready to retire?

Can parents use leftover money in their 529 plan to help their daughter with her college loans?

If you start a job with an employer who doesn't offer high-deductible, HSA-compatible health insurance plans, could you use a plan from your old boss?

And where should a father keep his daughter's Bat Mitzvah money?

My friend and former financial advisor Joe Saul-Sehy and I tackle these five questions in today's episode. Here's a close-up look at each situation.

Tyler asks:
My wife and I both work 9-to-5 jobs. She's an elementary school teacher, and I work in sales. We've recently welcomed our first child into the world, and we're expecting our second. We'd like to transition to a one-income household, at least until the children are between three to five.

We've maxed out my Roth IRA and 401k, funded a pension through my wife's work, funded a small Roth IRA for her, and started a 529 for our son.

We have no credit card debt, but we have a mortgage, a car loan, and a student loan from my wife's graduate work.

We're thinking about gradually phasing out her income, by reducing her "income" in 25 percent increments over time, and using that money to repay our debts. We hope to have the car loan and student loan paid off by the time our second child is born.

What other recommendations would you offer as we transition into a single-income household?

Heidi asks:
We saved money in a 529 plan for our daughter's college education. We took out some loans for her freshman and sophomore years, thinking that we'd spend the rest of the 529 money during her junior and senior year.

Then a wonderful thing happened: my daughter received $40,000 in scholarship money, covering her junior and senior years. Now my daughter has $13,000 in student loans from her first two years, and also $13,000 sitting in her 529 fund. Can we use the money in the 529 plan to repay her student loans? Or are our hands tied?

Andrew asks:
My 13-year-old daughter just had her Bat Mitzvah, and now holds $5,000 in a Schwab custodial account. Where should I put this money to preserve the capital, but also allow it to grow? She'll probably want to use a portion of this within the next five years. It's currently in a Schwab money market account, but I'm thinking about putting it in VFTSX, the Vanguard Social Index Fund.

Anonymous asks:
My husband just started a new job, and his employer doesn't offer HSA-compatible plans. His new employer only offers plans with low deductibles.

I know that this isn't idea. Could he enroll in plan from his old job, so that he can still contribute to an HSA?

Laura asks:
Am I ready to retire? I'm 55 and my husband and I have $2 million, but we recognize that the market is volatile. How do we maintain our $2 million principal when we're no longer making contributions?

My second question is about real estate. If the returns from both index funds and rental properties comes to around 8 percent, then why would you bother with the additional hassle of real estate?

Enjoy!

Jul 30, 2018
#141: The Gap Between Knowing and Doing - with Dr. Stephen Wendel from Morningstar
01:13:15

"I'll get around to rolling over my 401k ... next week."

"Eventually I'll switch to a cheaper insurance plan."

"I really should move my portfolio into lower-fee funds."

"Yeah, yeah, I know I should create an estate plan. I'll do it later."

____

We know how to improve our financial lives. We know what steps we ought to take. I'm betting that everyone reading this can name at least one action, big or small, that you could take to improve your net worth.

But we don't follow through.

Why not?

Why do we procrastinate? Why do we ignore the important, in favor of the urgent or the more-pleasant?

Why do we act against our self-interests? Why is there a gap between our intentions and our actions?

More importantly, how can we bridge this gap? How can we align our knowledge and intention with our behavior?

Dr. Stephen Wendel is a behavioral economist and the head of behavioral science at Morningstar, an independent investment research firm. He joins us on the Afford Anything podcast to answer these questions.

Here are a few tactics he shares:

#1: Automate
Set up systems that save you from yourself.

#2: Create mental accounts
Give every dollar a job. Earmark dollars for specific purposes, so that you don't view your money as commingled in a giant bucket that you can raid. Once you start thinking of piles of money as "my emergency fund" or "my kid's college fund," you'll be less likely to spend it on champagne and luxury hotels.

#3: Imagine vivid scenes
Our minds are predisposed to prioritize the vivid over the subtle, which is one reason why we suffer from "present bias" -- the tendency to only think about the present, often at the expense of the future. (For example, "I feel like sitting on the couch right now" takes priority over "If I workout, I'll feel better in the future.") In order to combat this, create vivid scenes in your mind that imagine the future in great detail.

#4: Create artificial hindsight
Imagine a future version of yourself, and from that perspective, look back in hindsight at yourself today. What will Future You regret doing, or regret not having done? This technique is called "prospective hindsight," and it allows you to anticipate the thoughts and emotions of your future self.

#5: Simplify
If you find yourself drowning in a sea of complex financial decisions, you might lose confidence in your ability to make choices, and therefore not take any action whatsoever. Reduce complexity by making moves that are 'good enough,' rather than perfect. Simplify in order to take action.

Dr. Wendel shares more tactics and insights in this episode. Tune in for a deep-dive!

Jul 23, 2018
#140: Ask Paula - Should I Buy a Rental Property with an HOA?
55:00

Should you buy a rental property that mandates HOA payments? How do you adjust for cap rate over the years, as the property's rent increases with inflation? Should you buy an $88,500 house that rents for $1,250 a month? And can you dive into detail about how you work with contractors and property managers?

I answer these four questions in today's Ask Paula episode, themed around real estate investing.

Daria asks:
My husband and I live in Charlotte, North Carolina. I've been looking at local properties and I notice that a lot of these properties, Class C+ or higher, come with HOAs. For example, I've found properties that cost $80,000, rent for $1,000 per month, and have HOA fees of around $150. What do you think about HOA fees in general, and how do these affect factors like cap rate? I'd love to hear your thoughts.

Sabrina asks:
How does the cap rate on a property change over time, as the rent increases with inflation and other operating costs shift around?

Jasmin asks:
I'm looking at a rental property that costs $88,500 and needs $2,000 in initial repairs and other fees. My gross rent would be $1,250 per month, with estimated 8 percent vacancy. I estimate $555 monthly in expenses ($6,660 annually), including setting aside one percent of the purchase price for repairs and maintenance and another one percent of the purchase price for capital expenditures. What do you think of this deal?

Rob asks:
Can you please explain how you work with your contractors and property managers? On your blog, you describe texting with your contractor, but shouldn't the manager handle that? I'd appreciate any insight into how you handle these relationships.

Jul 16, 2018
#139: How I Save Half of My Income as a Firefighter, While Living in an Expensive City -- with Kim E.
01:15:16

Five years ago, at age 29, Kim E. started her first professional, salaried full-time job, working as a firefighter for the City of Austin, Texas. She received a starting salary of $42,000.

Today, five years later, she has saved:
- one year's salary ($40,000) in an emergency fund
- one year's salary ($42,000) in a workplace retirement fund
- more than half a year's salary ($27,500) in a Roth IRA

She also paid off her student loans ($10,000), paid off her car loan (roughly around $16,000-ish), and contributed to an H.S.A. account ($6,000, half of which came from an employer match.) Oh yeah, and she also bought and renovated a rental property.

Translation? Kim has saved (or repaid debt of) $141,500 within five years, as a firefighter with a starting salary of $42,000, excluding the additional money she's invested into her rental.

**She's saved more than 3x her starting salary, within her first five years on the job.**

And she's done this while earning a middle-class public service salary in an expensive city.

Wowza.

How is Kim saving half of her firefighter salary? And before she became a firefighter, what other frugal tactics did she develop? How did she put herself through four years of college with less than $10,000 in debt? How did she travel before college, when she used to earn $10 per hour? Where does her resourcefulness and motivation come from? And what wisdom can she share with others?

Find out in today's episode.

Jul 09, 2018
#138: How to Create an Authentic Life
50:41

There’s a famous quote that’s attributed to Henry Ford. The quote says, “If I had asked people what they wanted, they would have said faster horses.”⠀

There’s no proof that Henry Ford actually said this. But whether or not that quote is historically accurate, the point remains. If Elon Musk had asked people what they wanted, they would have said a car with better gas mileage.⠀

But Elon never bothered asking. Because he knows you cannot change history from the middle of the bell curve. And he knows that design by consensus, by definition, leads to average results.⠀

He may ask for input on the details. But he will never ask the crowd to guide his vision.⠀

True innovation comes from vision. We see this in technology. We see this an art, music, writing. But often, we fail to see this in ourselves. We allow the crowd to dictate who we are: what our dreams are, what our goals are, what our fears are. We crowdsource our vision and live a life of “should.”⠀

Authenticity is the art of not giving a sh*t about should.⠀

This sounds fine on the surface, when we’re pontificating about our lives. But it’s much scarier in the real world, when you face the reality that people will judge you. They will criticize you. They will tell you that you’re wrong. ⠀

The more you try to step away from should, the more shoulds they throw at you. You should be married. You should have kids. You should have a job.⠀

The thing is, they may be talking about you, but it’s not really about you. Your decisions are triggering to them, and they’re reacting to that.⠀

Authenticity means accepting that if other people get triggered, that’s not your responsibility. You may be the catalyst, but you’re not responsible for their emotions.⠀

And in that regard, authenticity is also the art of setting boundaries.⠀

That doesn’t mean you exclude people from your life. But it does mean that you set healthy emotional boundaries, such that their thoughts and feelings do not become internalized as your own.⠀

_____

This is a snippet from a speech I delivered at the World Domination Summit in Portland, Oregon last week.

I'm sharing the speech for this July 2018 First Friday bonus episode.

We broadcast one podcast episode per week, and on the first Friday of each month, we roll out a special bonus episode.

Today's episode is July's special bonus episode, and I've divided it into two sections: during the first half, I share the speech that I delivered, and during the second half, I discuss how and why I wrote this speech -- and the key takeaway that I hope people learn from it.

Enjoy!

_______________________________________

For more ways to interact or listen to the show, go to http://affordanything.com/episode138

Jul 07, 2018
#137: Ask Paula: What the F**k are Annuities?
01:13:34

Today's episode is an annuity sandwich: we answer one question about family and relationships, three questions about annuities, and one question about time management.

My friend and former financial planner Joe Saul-Sehy joins me to answer questions in what, I hope, is the most entertaining episode about annuities you'll hear.

Here are the five questions that we'll tackle today.

Anonymous asks:
I didn't grow up with much money, and my father recently went into bankruptcy. I've worked hard to become financially stable. Unfortunately, my parents expect a handout. How do you handle parents and other family members who look for handouts when they see you're doing well?

Zoey asks:
I'd like to retire in the next 10-15 years. I'd like to understand the difference between an investment with a lump-sum payout vs. an annuity fund. What are the benefits and drawbacks of these options? How do annuities work? What are their benefits? How do I know what's right for me?

Charlene asks:
Let's say you're looking at your retirement portfolio, and you realize you're behind. You still have 10-15 years left. You have 10 percent of your portfolio in an annuity. Should you move this money into a stock fund? Or should you keep the annuity?

Magy asks:
My husband and I are both 32, and save 25% of their income for retirement. He has a 401(k) and maxes out a Roth IRA. I'm a teacher and make a pension contribution.

I also max out my Roth IRA and contribute a small amount to a 403(b). My 403(b), however, has a variable annuity with no surrender charge, with a 1.5 percent account fee. Should I keep putting money in this 403(b)? I also have a side hustle; would it be better for me to open a retirement account through my side business?

Also, since we're already saving 25% towards retirement, I'm curious if we should invest more for other goals. We're putting 3 percent of our income in non-retirement investment accounts and 1.5 percent of our income in our sons' 529 plans. How should we divide our savings between retirement vs. other long-term goals?

Laura asks:
You've often written about the importance of an emergency fund and cash reserves. Do you have any ideas in thinking about this way with regard to your time or focus?

If you're spending at capacity -- whether you're spending money, time or focus -- you have no space for either emergencies or opportunities. How do you conceptualize this? How do you balance busy-ness with the importance of creating free time and space?

We answer these five questions in today's episode. Enjoy!


______

Resources Mentioned:

- Afford Anything podcast episode with Laura Vanderkam
- Laura Vanderkam's book, 168 Hours
- David Allen's book, Getting Things Done
- Austin Kleon's book, Steal Like an Artist
- RoseMarie Garner interview on the FinCon podcast
- Afford Anything blog post, "I tracked my time in 15 min increments"

 

Visit the website at https://affordanything.com/episode137

Jul 02, 2018
#136: How I Bought 20 Houses, Debt-Free, While Serving Overseas in the Military - with Rich Carey
01:16:01

Rich Carey is a military millionaire. He's spent his career in the U.S. Air Force; he's currently stationed in Seoul, South Korea. He was stationed in Germany before this. He'll retire after this.

Most of his fellow servicemembers, upon taking a military retirement, start a second career. But Rich doesn't need to. He's financially independent, thanks to his 20 rental properties.

He bought most of these properties while stationed overseas. He's renovated them from afar. And he's bought everything with cash.

To say his story is impressive is an understatement.

Every week, I get emails and messages from readers who say things like:

*"I'd like to buy a rental property, but everything in my city is expensive!"*

*"I'd like to buy a rental property, but I'm not handy. I can't do any of the work myself."*

*"I'd like to buy a rental property, but I only make a middle-class income."*

*"I'd like to buy a rental property, but we're a one-income household."*

*"I'd like to buy a rental property, but we have two kids, and they're expensive."*

Rich's story illustrates how someone with a middle-class income can invest in rental properties from out-of-state.

He earns a military salary. He lives in Korea. He's the sole breadwinner in his family. He supports a wife and two children.

He's definitely not taking 2 a.m. toilet-fixing phone calls. In fact, he hasn't even seen several of his properties.

As you'll hear in the interview, my friend Emma and I visited Montgomery, Alabama about a year ago. Rich's properties are located there.

During our visit, I sent Rich an email, saying "Hey, I'm in Montgomery!," and he replied with, "Cool, I just bought another house there! You're welcome to drive by and see it from the outside."

This means I've seen houses that he hasn't. *His* houses.

____

How did Rich start investing in rental properties? How did he grow a portfolio of 20 rentals?

How could he build this free-and-clear, without taking out any loans?

And how does he manage this from Germany and Korea?

Find out in this interview.


______________________________

For more information, visit the show notes at http://affordanything.com/episode136

Jun 25, 2018
#135: Ask Paula - How Can I Get a Downpayment for a Rental Property?
54:15

Time to talk about houses! I answer your questions about rental property investing in this week's episode.

Our first question comes from James, age 25. He lives in Florida, where he bought a $130,000, 3-bedroom, 2-bath condominium in the Class B range as his primary residence. He'd like to buy a second home and rent out his current home.

He has $4,000 in cash and is eligible to take out $5,000 as a home equity line of credit. He makes $41,000 per year, after taxes. He'd like to buy one property a year.

What funding options can he look into? If he had good credit, can he bypass the downpayment wall? What general advice would I offer to someone in his situation?

Here's a short summary of what I tell James:

1. Keep a personal emergency fund.
2. Keep cash reserves for your rental. If your condo rents for $1,300 per month, you'll want at least 3 months' gross rent in reserves, or $3,900.
3. Look into FHA loans, which require only 3.5 percent down.
4. Wait until the HELOC can get you at least $10,000 to $15,000. Ideally you'll also want a little extra on the side for  closing costs and other unexpected costs.
5. Think of 'one house a year' as general guideline rather than diehard order. The more properties you purchase, the faster you can buy properties, because you can reinvest the cash flow from your existing properties. Your growth will be slowest in beginning and gets faster as you move along.  

The next question comes from Berlinda. She works in a job she loves, with a great company, chill manager and fantastic team. She's signed a two-year contract, and she's six months into that term.

She lives in metropolitan Chicago, but her boyfriend lives in New York. She's concerned that if she moves there, she might not find a job that she loves quite as much.

She bought a duplex, and now owns a total of three rental units. She needs to upgrade these units. She projects that she'll need 14 rental units before she can live on the income. How can she scale her rental properties to the point at which she can live on their income?

The third question comes from Katie from Mississippi. She started reading the Afford Anything blog in 2015, after she bought her first rental property. She now owns two rentals. She bought the first for $77,000 (purchase + initial repairs) and it rents for $975, and the other for $80,000 (purchase + initial repairs) and it rents for $900. After the PITI mortgage, they collect $603 per month, or $7,236 per year. Their operating expenses have consumed this amount, and in some years their operating costs exceed their income. What's going wrong?

The final question comes from Ben. He and a business partner owns a multi-unit rental property, which they purchased two years ago. His business partner lives in one of the three units; the total income is $2200 from two of the three units (plus the partner lives in one unit for free). Their mortgage is $1475, plus $120 for insurance.

Ben would like to get out of the deal, but he's not sure how. He'd like to refinance the property to get his name off the mortgage, either by selling his share to his business partner or by finding another partner to replace him within the deal. What should be do?

____

I answer these four questions in today's episode. Enjoy!

For more information, visit the show notes at http://affordanything.com/episode135

Jun 18, 2018
#134: How Radical Curiosity Leads to Innovation in Life and Work - with Shane Snow, founder of Contently
01:14:51

We often peek inside the world of business to look for lessons about how to simplify, optimize and innovate.

But what can we learn when we examine world-class people who are hacking the system in any field -- including sports, politics and music?

What can we learn when we're radically curious about everything? And how can we apply this knowledge to helping us lead more deliberate, curated lives?

Today, we tap Shane Snow's brain for answers.

Shane Snow is a co-founder of Contently, a company that matches freelancers with publishers. But we're not going to talk about that today. We're going to explore bigger themes.

Because Shane isn't just a tech entrepreneur. He's also an award-winning journalist, which is another way of saying that he's an inquisitive person who lives in the world of storytelling and big ideas.

His first book, SmartCuts, explores how people avoid climbing the normative career ladder. It showcases people across a variety of industries who hack the ladder, often by making unconventional lateral moves. And that is exactly the kind of thinking that appeals to anyone building financial independence, and trying to design a meaningful, autonomous and unconventional living.

His latest book, Dream Teams, explores what it takes for a group of people to come together to create something amazing. How can the whole be greater than the sum of its parts. And he looks across industries, at everything from hockey teams to businesses and beyond, to find the universal threads inside these stories.

A few accolades before we begin: GQ Magazine described Shane's work as "insanely addicting," and The New York Times refers to Shane as a "wunderkind." (I had to Google that term -- apparently, it refers to someone who achieves great success at a young age.) He has also, somehow, appeared on Gossip Girl and beat Super Mario 3.

Let's find out what Shane has to say about innovation, curiosity, teamwork, and hacking the system. Oh yes, and kangaroos.

For more information, visit the show notes at http://affordanything.com/episode134

Jun 11, 2018
#133: Ask Paula and Joe -- How to Give More to Charity While Also Building Financial Independence
57:21

Andy from Michigan loved the episode with charity:water founder Scott Harrison. After the episode, he and his 6-year-old daughter started watching videos about charity:water, and now they're both inspired to give.

Andy's question is on the topic of giving. His is to reach financial independence within 5 to 10 years. He and his wife are debt-free, including mortgage-free, and their retirement accounts are well-fueled. Now they're working on building passive income. In the meantime, though, they'd like to add a bigger charitable slice to their budget. He's not an overly religious guy, but he feels a calling to make more charitable donations than he does. What advice could we offer about how to boost his giving?

JR's wife, before they got married, purchased two timeshares at a 17.9 percent interest rate. When the couple met, and she confessed, they immediately paid off the debt. They're now paying $160 per month in timeshare fees. JR is trying to figure out how to get rid of their timeshare, but he can't find any good options. How can he get rid of this?

Angela's husband is turning 50, and she is 43. They're on-track to have $1 million in investments within 7 years. They have two rental properties plus a primary residence, all of which will be paid off in around 7 years, as well. They're active and healthy, but they know this can change quickly. What type of long-term care insurance do they need?

Joelle works in the public sector. She has a 457(b) retirement account. How does this differ from a 401(k)? She plans to career-change in the next few years, and she's considering whether to keep her funds inside of her 457(b) or rollover her funds into an IRA. What are the pro's and con's of both?

Ines from Portugal wants to start a podcast about financial independence, early retirement and real estate investing, specifically for people who live in Europe. The issues that affect people in Europe are different than those that impact people in the U.S., and she sees a need within the marketplace. What advice would I offer to anyone who wants to start a podcast in this niche?

For more information, visit the show notes at http://affordanything.com/episode133

Jun 04, 2018
#132: Ask Paula - I'm Six Years Away From Financial Independence, But I Want to Quit Now
36:31

BONUS EPISODE!! On the first Friday of the month for the remainder of the year, I'm rolling out an additional bonus episode.

As you know, this podcast airs weekly on Mondays. I'm thinking about maybe -- MAYBE -- expanding the podcast to twice-a-week. Maybe.

But before I make such a big commitment, I figured I'd test the waters by producing *one* extra episode per month.

I'll release this on the first Friday of every month for the rest of 2018.

Today's episode is the June 2018 First Friday Bonus Episode, in which I answer three questions from the Afford Anything community. Enjoy!

____

Cameron accepted a job in the Middle East, where he earns 60 percent more than he could make at a comparable job in the U.S. He also gets free health care and 30 vacation days annually, which gives him time to travel with his wife and four kids. And thanks to his income and benefits, he and his family are on-track to reach financial independence in six years.

The problem? He's just not that into his job. He'd like to pursue something more interesting ... he's just not sure what. And since he doesn't know what's next, he's worried that he might be running *away* from something rather than running *into* something else.

Should he tough out the next six years? Or should he quit, even if that will delay his journey to financial independence?

__

Hailey is 22, and she bought her first home last year. She bought a condo for $103,000 with a 3 percent downpayment and a 30-year, fixed-rate mortgage at 4.5 percent. Her condo was in mediocre shape at the time, so she's spent the past year renovating the space -- such as replacing the flooring and getting rid of the popcorn ceilings.

Her neighbor recently sold his condo for $120,000, so Hailey is reasonably sure that -- between the comparable sale and the improvements that she's made -- her condo could appraise for at least that much.

She'd like to get an appraisal, so that she can get rid of her $60 monthly PMI payment. But an appraisal costs between $660 to $850, and she's only planning to live in the condo for another year. She thinks she'll keep the condo for around three more years.

Should she get an appraisal? Are there any red flags or drawbacks to doing this?

________

Danica called to say "congratulations!" on the 10-year anniversary of quitting my job. She's curious: how did I reach financial independence?

I answer these three questions in today's First Friday Bonus Episode. Enjoy!

For links to resources mentioned in this episode, visit http://affordanything.com/episode132 

Jun 01, 2018
#131: How We Slashed Our Costs 70 Percent and Gained Happiness -- with Scott Rieckens
01:10:40

Scott Rieckens and his wife Taylor enjoyed a classic Southern California lifestyle.

They lived near a gorgeous beach in sunny San Diego. They frequently dined at sushi restaurants. They drove a BMW.

But after the birth of their daughter, everything changed. Taylor, an intelligent, career-driven, independent woman, suddenly didn't want to spend any time away from her new baby girl.

And Scott had no idea what to do. Their luxury lifestyle depended on dual incomes.

At first, he tried to come up with a million-dollar idea. If he could just create a wildly successful business, he thought, he could fix this problem. He started binge-listening to podcasts, trying to figure out how to pull in seven figures, fast.

Then he discovered the financial independence movement. And suddenly everything made a lot more sense.

Scott realized that if they gave up their consumption habits -- if they moved to an area with a lower cost-of-living, drove less expensive vehicles, or maybe even lived in an RV for awhile -- they could enjoy the life they wanted. They could trade luxury labels for time-freedom.

He crunched a few numbers and realized that they could reduce their spending by 70 percent. But it would require HUGE changes, including an out-of-state move.

He wondered how to suggest this idea to his wife.

______

What did Scott say? How did Taylor come on-board?

And (spoiler alert!) ... how did they get so enthusiastic about financial independence that they decided to create a documentary about their journey into this lifestyle?

Find out in today's episode.

May 28, 2018
#130: Ask Paula - Should I Sell Stocks to Buy a Rental Property
58:45

Anna and Dave want to get married ... eventually. But they want to buy a rental property together first. How should they approach this from a paperwork/legal structure standpoint? Note: They're thinking about having one partner purchase the home, with the other partner acting as a lender (with proper paperwork in place). Would this be a wise approach? Fred lives in Saskatchewan, Canada and owns two duplexes. He's thinking of buying rental properties in the U.S., and he has 4 questions: - What requirements or criteria do you establish ahead of time? For example, do you look for a minimum cap rate? Or a specific type of property? - When you're looking out-of-state, what steps do you take to identify a community? How about the type of property? - What market research do you undertake? - How would you caution an international investor who wants to start investing in U.S. properties? Jordana wants to build financial independence. She's thinking about selling off stocks and index funds in order to buy her first rental property. Is this a good idea? Cheryl lives in Texas, where property taxes are astronomical. How should she factor this into her rental property decisions? Rachel is worried about bed begs. (Yuck!) Have I dealt with these in any of my rental properties? How do I protect against pests, termites and roaches? I tackle these five questions in today's episode, which is dedicated to rental property investing. Enjoy! (And P.S. -- If you're not interested in rental investing, don't worry! Check out last week's episode about debt payoff with Laura Adams, or the previous week's episode, in which Joe Saul-Sehy and I answer a smattering of general personal finance questions. Have fun!) ____ For more information, visit the show notes at http://affordanything.com/episode130

May 21, 2018
#129: How I Paid Off Thousands in Credit Card Debt - with Laura Adams, from Money Girl Podcast
57:01

Laura Adams grew up in an upper-middle-class family in South Carolina, and her parents supported her through college. She attended her top-choice school, met her husband while they were still students, and enjoyed a charmed life.

When she graduated, she continued to live at a lifestyle to which she felt accustomed. She rented a beautiful apartment. She took vacations. When she felt lonely, she comforted herself with shopping sprees.

Unfortunately, her spending habits weren't aligned with her meager post-collegiate, entry-level income. Laura quickly found herself buried under thousands of dollars of credit card debt.

She began feeling anxious about the debt. Fortunately, Laura channeled that anxiety into action.

She cut back on discretionary spending. She watched her monthly mortgage payments fall. She focused on ways to earn more.

Every time she'd free a small chunk of money -- a hundred here, a hundred there -- she made an extra payment on her credit card balance. Eventually, Laura wiped out her debts.

She decided to become a "serious student" of finance. She returned to school for an MBA, where she noticed that many of her classmates were intelligent, hardworking students who were superb at managing corporate balance sheets, but terrible at managing their own personal finances.

She decided to spend her life solving this problem.

In 2006, she began writing about personal finance; in 2007, she started a personal finance podcast; by 2008, she was invited to join the Quick and Dirty Tips Network as the host of the Money Girl Podcast.

Her podcast on personal finance has been downloaded more than 40 million times. Laura has also authored several books on money management and appeared on more than 1,000 media interviews on NBC, FOX, Bloomberg and more.

How did Laura transition from wearing "financial blinders" to a renowned financial expert?

What advice would she give to anyone who's trying to overcome the "ostrich," head-in-the-sand mindset around their money?

What important money issues are we not talking about enough?

Find out in today's episode.

For resources mentioned in today's episode, go to http://affordanything.com/episode129

May 14, 2018
#128: Should I Choose a Roth vs. Traditional IRA and 401k for Early Retirement?
01:11:12

Antonia, 27, wants to retire in 15 years. She's trying to figure out whether to contribute to pre-tax or after-tax retirement accounts.

Most financial advice for 20-somethings that she's encountered says to contribute to after-tax (Roth) retirement accounts. These articles assume that a 27-year-old will continue earning money for the next 30+ years, presumably escalating into higher tax brackets along the way.

By paying taxes upfront, these articles say, you'll enjoy 30+ years of compounding gains, which you'll be able to withdraw tax-exempt.

But what if, like Antonia, you're only 15 years from retirement? Should you stick with Roth tax treatment? Or is there wisdom in making retirement contributions with pre-tax money?

_____

Marisa is young, high-income, and highly risk-tolerant. She'd like to know: what asset allocation would I suggest for a young, risk-tolerant person? And is rebalancing her portfolio necessary, or just a distraction?

_____

Dylan owns his home outright. When he sells it, he'll collect about $100,000 after fees. He also has an additional $100,000 saved in cash.

He'd like to buy a home free-and-clear. What's the best way to approach this? Should he take out a home equity line of credit? A bridge loan? Something else?

_____

Pal lives in the San Francisco Bay Area. He recently bought his first rental property, and he's interested in building passive income and reach financial independence.

He's curious about credit card piggybacking, a side hustle by which a person with a high credit score adds another person with a low credit score as an authorized user to their card.

It seems like a legitimate way to earn extra money. Why aren't more people talking about this? Is there a problem he's overlooking?

_____

Anonymous, 24, says she knows next-to-nothing about investing. She has $6,500 in her Roth IRA, invested in a Washington Mutual Class A mutual fund, which is an actively-managed mutual fund with a front load.

Should she keep her money there? Or should she move it?

Her second question is about her 401k. She contributes 5 percent of her paycheck into a Roth 401k account, from which she invests in a Target Date retirement fund. Her employer doesn't match any contributions.

Her total contributions to both accounts (her Roth 401k and Roth IRA) equal $5,500 per year.

Should she stop contributing to her Roth 401k, so that she can focus her contributions on her Roth IRA?

____

Jeff and his wife are both 64. When he reads about retirement, the information is ambiguous about Social Security.

Let's say that he has $1 million saved towards retirement, which generates $40,000 annually at the 4 percent rule of thumb. Let's also say that he is eligible for Social Security income of $40,000 per year. Doesn't this mean he could retire on $80,000 per year? If so, then why do "4 percent rule" projections only talk about the portfolio portion?

____

Former financial advisor Joe Saul-Sehy and I discuss these questions on today's episode. Enjoy!

 

For links to resources mentioned in this episode, go to http://affordanything.com/episode128

May 07, 2018
#127: Four Unhealthy Attitudes Towards Money -- with Dr. Brad Klontz, Financial Therapist
01:06:21

Most people know what they “should” do — save for the future. Spend less than they earn.

Why do so few people follow through?

The answer may have less to do with tactics, and more to do with a person’s deep-seated beliefs, fears and anxieties around money.

Your income, debt, and spending habits aren't merely a function of your actions. They're a reflection of your deep-seated inner psychology around money.

Dr. Brad Klontz, a clinical psychologist and financial planner, joins me on today's show to discuss four "money scripts" that may be harming us. These scripts include:

Money avoidance -- We believe money corrupts or that staying poor is noble, so we self-sabotage our success. Yet at the same time, we also desperately (at the conscious level) want more money in our lives, and feel trapped between these conflicting ideas.

Money worship -- We believe money will solve our problems. And even though we know that the research says that, after a tipping point, it won't, we don't internalize that idea.

Money status -- We believe our net worth is our self-worth, and we overly identify with our investment and bank balances. We may display conspicuous consumption or place a high priority on making the "right" friends.

Money vigilance -- We watch our money carefully, but we may also feel anxious about running out. We may also downplay the amount of money that we have, if we're outperforming our friends, because we feel guilt and imposter syndrome.

In addition to these four "money scripts," we also grapple with innate cognitive biases around how we manage money.

Let’s take a look at loss avoidance, for example, which is a common cognitive bias. Humans are hardwired to fear losing money, far more than we fear missing opportunities for growth. As a result, we might hold onto an investment for longer than we should. Or we might become preoccupied with penny-pinching, at the expense of earning more.

In this episode, Dr. Klontz and I discuss shame, guilt, and how to implement behavioral changes. We talk about how to contextualize our beliefs based on our family history, and how to recognize whether or not our beliefs are limiting or dysfunctional.

Dr. Klontz shares his story about graduating with $100,000 in student loan debt, and feeling anxious about whether or not he could repay this loan. He decided to sell his car, poured the proceeds into tech stocks, and watched this investment disappear. That’s when he started questioning why someone like himself, someone of relative intelligence, would do something so ill-thought-out. And this sparked his lifelong passion in financial psychology.

How can you develop a healthy relationship with money? Find out in today's episode.

For more information, visit the show notes at http://affordanything.com/episode127

Apr 30, 2018
#126: Ask Paula - Should I Buy a Beachfront Rental Property?
01:04:04

It's time to answer real estate investing questions!

Tom asks:
"We're thinking about buying a duplex on a beach in a popular vacation destination in Florida. If the property stays 85 percent occupied as a short-term (VRBO) rental at current rates, the income from one unit of the duplex could cover the costs of a 30-year mortgage.

"But if a recession hits, Florida real estate might tank. The rental rates or occupancy could drop. And we'd be stuck paying the mortgage out-of-pocket, which means we might not be able to retire. Should we take this risk?"

Rachel asks:
"Would you consider purchasing a beach house? Also, would you consider buying out-of-state?"

Alfredo asks:
"I own a couple of rental properties. I have to admit, my personal and business funds are completely co-mingled. I'm trying to separate these expenses, but it's a mess. If I hired professional help, how much might I pay?"

Anonymous from the Northeast asks:
"I'm gathering friends to invest. We live in the northeast, where home prices are expensive. I'd like to invest out-of-town. They'd like to invest locally. What talking points can you give me to convince them to invest out-of-state?"

Mitzi asks:
"Could you please explain the 1 percent rule-of-thumb around buying a rental property?"

I answer these 5 questions in this episode. Enjoy!

For more information, visit the show notes at http://affordanything.com/episode126

Apr 23, 2018
#125: How to Gain a Competitive Edge, with Morgan Housel
01:02:01

Morgan Housel has spent thousands of hours reading about investing.

As a former columnist for the Wall Street Journal and The Motley Fool, he's spent more than a decade reading, interviewing, thinking and writing about how to manage money.

And he's come to a simple conclusion: less is more.

Doing nothing is often the best course of action.

Patience, humility and long-term thinking give individual investors a massive competitive edge over major institutions.

The classic strategy of dollar-cost averaging into index funds is a smart approach.

And ultimately, success is based more on emotions than Excel.

This week, Morgan joins me on the podcast to discuss how to gain a competitive edge as an investor.

For more information, visit the show notes at http://affordanything.com/episode125

Apr 16, 2018
#124: Ask Paula and Joe - Should I Sell My Brand-New Car (and Lose $6,000 in 4 Months)?
01:02:14

Former financial planner Joe Saul-Sehy and I answer five questions about investing, retirement, insurance, travel and selling an expensive car.

Eliana is 25 and makes $63,000 per year, plus a little extra from freelance work. She holds $95,000 in cash, $67,000 in retirement investments, and no debt. She doesn't necessarily hold early retirement as a goal, but she'd like the option to access her funds before she's 59-and-a-half.

She asks two questions: First, she's been spreading her money between a Roth IRA, pre-tax 403b, and taxable brokerage account to spread her risk. Should she not contribute so much to the taxable account?

She's also paying $88 per month for a $25,000 life insurance policy for her mother, who is 57 years old. She likes the peace-of-mind that comes with knowing it'll be there to cover funeral expenses, if needed. But she recognizes that there's a huge opportunity cost that comes from paying for such an expensive plan. Should she drop it?

Rudy's employer offers two options: a pension or a retirement plan that essentially functions as an annuity. He would need to contribute 3 percent of his income, regardless of which option he chooses. Which one should he pick?

Nicole lives in Canada. She has a Registered Retirement Savings Plan (RRSP), to which she contributes monthly. She's been with her employer for almost 10 years, but she's about to switch into a new field. She'll have about $45,000 in a pension plan from the employer that she's leaving. What should she do with this money?

Julie is a frugal single mom of two. Four months ago, she purchased a brand-new vehicle for $39,000 and instantly regretted it. She'd like to sell it, but she could only recoup around $33,000 of value. She'd lose $6,000 from a car she's owned for 4 months. Should she take the hit? Or should she hang onto her car, since the damage has already been done?

Finally, an anonymous caller wants to know more about long-term travel. How do you acquire visas that will let you stay in a country for many months? How do you find health insurance with overseas coverage? And what should you do with your snail mail?

We tackle these questions in today's episode. Enjoy!


________


Resources Mentioned:

Julie's question:
Articles on selling a car, private party:
https://www.edmunds.com/sell-car/10-steps-to-selling-your-car.html
https://www.edmunds.com/sell-car/sell-your-car-safely.html
https://www.edmunds.com/sell-car/how-to-close-a-used-car-sale.html

Articles on buying a car, private party:
https://www.edmunds.com/car-buying/buying-a-car-sight-unseen.html
https://www.edmunds.com/car-buying/10-steps-to-buying-a-used-car.html

Travel question:
Overseas health insurance:
- https://www.imglobal.com/travel-medical-insurance
- https://www.gninsurance.com/international-travel-health-insurance-plans
- https://www.geobluetravelinsurance.com/product_overview.cfm

How to handle mail while overseas:
https://www.earthclassmail.com

Apr 09, 2018
#123: Your Money or Your Life -- with Vicki Robin, bestselling author
01:03:21

In the 1970's, a woman named Vicki Robin teamed up with a man named Joe Dominguez.

They came from different backgrounds: she was an Ivy League graduate with a comfortable upbringing; he was raised in Spanish Harlem on "welfare cheese."

But they shared one common thread: a commitment to financial independence, not just as a money management strategy, but as a philosophy on life.

Vicki and Joe became partners in both work and life. They united over a definition of "FI" that expanded beyond paying your bills through your savings and investments. They saw FI as a lifestyle that exists in three dimensions:

1: Financial Intelligence -- Your ability to think about money in an objective, unbiased and non-emotional manner.

2: Financial Integrity -- Your ability to earn and spend in a manner that's consistent with your values, and to stay aware of the impact of your earning/spending choices on yourself, your family and your planet.

3: Financial Independence -- Your ability to break the shackles of paycheck dependence, and ALSO your ability to declare independence from limiting beliefs, fears, and the perception that money will solve your problems.

In 1992, Vicki and Joe co-authored a book called Your Money or Your Life, outlining the FI philosophy. Their book became a mega-bestseller, selling more than one million copies. It landed on the New York Times bestseller list and spent more than 5 years on the BusinessWeek bestseller list.

Oprah Winfrey said: "This is a wonderful book. It can really change your life."

Vicki and Joe devoted the next five years to spreading the message of FI. They appeared on hundreds of TV and radio shows, including Oprah, Good Morning America, and NPR. They were written about in the New York Times, the Wall Street Journal, People Magazine, and Newsweek.

Joe passed away in 1997, and Vicki continued spreading the FI message for another five years, before her cancer diagnosis caused her to take a step back.

Today, Vicki is 72, healthy, and still spreading the FI message. And she'd like to discuss a fourth dimension to FI:

4: Financial Interdepedence -- Your ability to live within a flow of giving and receiving. Interdependence comes from our relationship with our communities, our nation, and the natural world.

In today's podcast episode, Vicki discusses how we can move from financial independence to financial interdependence.

Enjoy!

For more, go to http://affordanything.com/session123

Apr 02, 2018
#122: Ask Paula - I'd Like to Airbnb a Yurt. Should I?
48:11

Tony lives in Chicago, where the returns on rental properties are so-so. He's thinking about investing in Indianapolis, where he consistently finds rental properties with cap rates that are greater than 8 percent. Should he invest locally, so that he can get a primary residence mortgage and keep a closer eye on the space? Or should he invest out-of-state, where the returns are stronger?

Dan lives in California. He's curious: where should he look for rental properties? And when should he buy? Dan holds $150,000 in a savings account and carries a mortgage and car loan with less-than-2-percent interest rates. Should he continue saving, or is he ready to take the plunge?

Isaiah and his friends want to buy a plot of land and build two yurts, complete with internal bathrooms and kitchenettes. They estimate this will cost $120,000 and they can Airbnb the yurts for $100 per night. They'd like this to be a hybrid between an investment and a personal vacation spot. Should they do it?

Evelyn lives in Brooklyn, where she's an Airbnb host within her primary residence. She'd like to sell her home and she expects to clear $1 million in equity. What should she do with this windfall? She holds $100,000 in a SEP-IRA and $10,000 in credit card debt, and she can't qualify for another mortgage.

I tackle these questions on today's episode. Enjoy!

For more information, visit the show notes at http://affordanything.com/episode122

Mar 26, 2018
#121: How I Retired at Age 32 - with Liz Thames from Frugalwoods
01:01:22

After Liz Thames graduated from college, she couldn't find a job.

"Nowhere would hire me," Thames says. "I had what I thought was this nice resume, and I sent out over 50 applications. Nowhere called me back."

She took a temporary job at a document-scanning agency, then joined Americorps to serve as a full-time volunteer in a low-income neighborhood in Brooklyn. She lived on a stipend of $10,000 annually, plus food stamps and a transit pass.

She saved $2,000 from her $10,000 stipend, while paying rent in New York.

To say that Thames is a natural saver is an understatement.

Her frugality stayed intact throughout her twenties. She got married, earned a free masters degree and advanced into higher-paying roles. But she and her husband, who was equally frugal, continued saving as much as possible -- at times pushing their savings rate to as high as 70 percent of their income.

When they were 30, they decided to shoot for financial independence. They shared a dream of moving to a rural farm, where they could raise children and spend everyday outdoors.

By age 32, they achieved financial independence. Their investment portfolio is robust enough that they could draw down, in perpetuity, for the rest of their lives.

They rented out their home in Cambridge, quit their office jobs, and moved to a 66-acre farm in Vermont. These days, they live on a combination of their rental income and 'side hustle' income from their blog, Frugalwoods. They have two children.

Today, Liz joins me on the Afford Anything podcast to share the story of how she and her husband achieved financial independence by age 32.

Resources Mentioned:
Book: Meet the Frugalwoods
Website: Frugalwoods.com

 

For more information, visit the show notes at http://affordanything.com/episode121

Mar 19, 2018
#120: Ask Paula - I'm Retiring at 53. How Will Early Retirement Impact My Social Security?
46:00

Roger Whitney, age 51, calls himself The Retirement Answer Man. As a financial planner, investment analyst and podcast host, he focuses on helping Baby Boomers craft a traditional (past-age-60) retirement.

Today, he joins me to answer two questions that come in from our community.

Our first question is from Emily, who says:

“I’m trying to help my mom decide if she should retire.”

“My dad was a CPA and then a CFO, making great money, until 16 years ago when he was diagnosed with early-onset Alzheimers. My mom never took care of their finances before, or knew anything them … she took a few years to get everything in order, but during that time, they burnt through their retirement savings.”

Their house sold in fall 2009, for just enough money to cover their mortgage balance and keep another $75,000 to invest.

Today, Emily’s mom is 64 and wants to retire. She’d like to use her small investment balance to buy a home outright, in cash, so she won’t have to worry about rent or mortgage in retirement.

Emily’s recommendation is that her mom waits until she’s 65 so she gets Medicare. But what if market correction happens? Will they regret not cashing out the investment at the peak?

Our second question is from Yvonne, who asks:

I’m 52, and I’m going to retire at age 53-and-a-half. (Hooray!!)

I’ve been getting notices from Social Security, telling me that “if I keep working” until age 62, or 65, my payment will be such-and-such amount. The key words, of course, are “if I keep working.”

How will an early retirement affect my Social Security benefits?

___

After taking these two calls, Roger and I chat about his new book, Rock Retirement.

We’re also GIVING AWAY 10 FREE COPIES of Rock Retirement. To enter the contest, go to http://Instagram.com/paulapant, follow the account, find the photo of the book cover, and like and comment on that photo. We’ll pick 10 lucky winners who will receive a free copy of the book in the mail. The contest entry deadline is Sunday, March 18th, 2018 at 5 pm Pacific. Winners will be notified by direct message (DM) on Instagram.

Mar 12, 2018
#119: How Much Can I Spend in Retirement? - with Dr. Wade Pfau
59:53

Once upon a time, in southern California in 1994, there lived a man named William Bengen.

He read many claims, widespread at the time, that said that since the markets return at least 7-9 percent compounding rates on average, retirees could withdraw and spend 7 percent of their portfolio.

William had a hunch that this was misguided. He decided to prove it.

He looked at 30-year timespans in U.S. history, starting from 1926. The first timespan ranged from 1926 to 1955. The second timespan ranged from 1927 to 1956. And so forth.

He assumed that the retiree held 50 percent stocks, in the form of an S&P 500 Index, and 50 percent bonds, in the form of intermediate-term government bonds.

Then he asked two questions:

First, what was the worst-case scenario? Retiring in 1966. The 16-year timespan from 1966 to 1982 was extra-rough, and experiencing this sequence of returns at the start of retirement made for one sad, sad puppy.

Second, how much could an investor sustainably withdraw from her portfolio during that worst-case scenario? The answer was 4.15 percent in the first year, and 4.15 percent, adjusted for inflation, every subsequent year.

And thus, the 4 percent rule-of-thumb was born.

And we all retired happily ever after.

____

Or did we? This week's episode features an interview with Dr. Wade Pfau, who offers counterintuitive ideas about retirement income.

Dr. Pfau is a Professor of Retirement Income at The American College of Financial Services.

He holds a Ph.D. in economics from Princeton. He's a chartered financial analyst. He won two awards for "most outstanding contribution" from the Journal of Financial Planning. He won another award for "best paper in retirement planning" from the Academy of Financial Services.

This guy knows his stuff.

And he's ... *cautious* ... about the 4 percent rule of thumb.

What are his concerns?

What can we expect?

And how much money can we spend in retirement -- whether we enjoy a traditional or early retirement?

Find out in today's episode.

____

For resources mentioned, visit https://affordanything.com/episode119

Mar 05, 2018
#118: Ask Paula - How Do I Buy a Foreclosure? - and Other Real Estate Questions
44:01

Questions -- I get questions! Today, I’m tackling four queries about real estate investing that come from the audience. Here are the details:

Sam says:
I work full-time and I’m not handy, so I definitely need a property manager. I’ve found an amazing property management company, but they only serve a small, specific neighborhood. Should I buy a property in this neighborhood so that I can use this fantastic property management company?

Terri asks:
I’ve heard that if you’re above a certain income level, you’re unable to carry-over losses from your income property. My accountant says it doesn’t make sense to buy a rental property if you can’t carry-over losses. Is this true?

Anonymous asks:
I’d like to buy my first rental property when I’m in graduate school. I’ll live in one room and rent out the other. What should I consider?

Noelle says:
We’d like to sell our home, and use the proceeds to pay cash for a foreclosure in the South. How do we find a foreclosure or short sale?

We cover these questions in today’s episode. Enjoy!

_____


Resources Mentioned:
Amazon - nolo every landlord's tax deduction guide
https://www.nar.realtor/rofindrealtor.nsf/pages/fs_sfrspec?OpenDocument

Feb 26, 2018
#117: How to Avoid Killing Your Spouse (and Should You Get Married in the First Place?) - with Farnoosh Torabi
53:45

My friend and financial expert Farnoosh Torabi joins me to answer a relationship & money question from a listener named Janice.⠀⠀
⠀⠀
Janice is engaged, and she calls to ask: Should she get married?⠀⠀
⠀⠀
She earns double what her fiancé makes. She has no debt except her mortgage. Her retirement accounts are well-funded.

He makes half of her salary. He’s carrying $20,000 in credit card and student loan debt. He has two children from a previous marriage and pays 25 percent of his income to child support. He has zero retirement savings other than his state-funded teachers pension.

They’ve been together for 8 years and engaged for three. But she’s unsure about whether or not she should walk down the aisle.

Should they get married? Is this a smart financial decision?⠀⠀
⠀⠀
Farnoosh and I both tackle this question together — and we disagree on some points, which makes this conversation better!!

Farnoosh is the bestselling author of When She Makes More, a book that takes an in-depth look at households in which the woman earns more than the man. She hosted a primetime show on CNBC, makes regular appearances on The Today Show and Good Morning America, and writes a monthly financial column for O, The Oprah Magazine. She’s a former reporter for Money Magazine.

She's the perfect guest for a conversation about relationships, marriage, money, debt, family.⠀

Enjoy!⠀

For more information, visit the show notes at http://affordanything.com/episode117

Feb 19, 2018
#116: Ask Paula -- Help! I'm Underwater on My Car!
01:20:01

Stacy and her boyfriend would like to downsize to one vehicle. But they're collectively $14,500 underwater on their car loans.

Stacy owes $11,000 on her car, but its trade-in value is $7,200. She's paying a 12.74% interest rate and her payoff date is 2021. 

Her boyfriend is in worse shape. He owes $18,500 on his vehicle, but its trade-in value is $7,800. He's paying a 21.5% interest rate and his payoff date is 2022.

Theoretically, they could sell Stacy's car to a private party, and she could pay off the rest of her loan. But the boyfriend's car is not in great shape, and probably won't survive for the next couple of years. And neither of them have found better refinancing deals.

What should Stacy and her boyfriend do?

_____

Rachel earns $65,000 per year. She’s 27 years old, contributes 20 percent to her retirement account, and holds $5,000 in savings. 

She owes $19,000 on a car loan, at a 4 percent interest rate, and $170,000 on student loans, all with different interest rates, but the highest at 7.9 percent.

She’s hesitant to consolidate her student loans, because she’s currently on a government plan that gives her flexibility, and she doesn’t want to switch into a plan that requires her to make a fixed monthly payment.

She’d like to know if she should use her savings to invest, or repay her loans.

_____

Misty is 40 and has no retirement savings. She lives overseas and is able to save about $20,000 per year. She plans on living overseas for a couple more years before returning to the United States.

Her employer doesn’t offer any retirement benefits or match, and her health insurance accounts are not HSA eligible.

She’d like to contribute to index funds. Is this a good strategy? Does the fact that she lives overseas change her considerations?

____

Nicole is from New York and is living in Abu Dhabi. She’s been living there for three-and-a-half years and makes good money. She’s repaid her student loans and has a lot of cash saved. She’s single.

She wants to become financially independent. What should she start doing now?

_____

Karen is 32 and lives in Los Angeles. Her take-home pay is $4,300 per month. She supports her parents financially, which costs $1,200 per month; she also lives with them. 

She paid off $60,000 in student loans in 5 years. She’s has $100k in a high-yield savings account and $100k in 403b. She holds $12k in student loan debt from graduate school.

She wants to make 20 percent downpayment on a home with the cash that she’s saved. She’d like to live there, but also have the potential to rent out this home if, at any point, she decides she doesn’t want the burden of a mortgage anymore. She’d like to keep her mortgage to $2,000 per month.

Given that the housing market is so high, should she buy a home? Or should she wait for a market crash and keep saving in the meantime?

____

Former financial advisor Joe Saul-Sehy and I tackle these questions in this episode. Enjoy!

For more information, visit the show notes at http://affordanything.com/episode116

Feb 12, 2018
#115: How Dave Ramsey Taught His Kids About Money -- with Rachel Cruze
56:57

Rachel Cruze was born the year her father, Dave Ramsey, filed for bankruptcy.

During her childhood, she watched her parents transition from struggling and rebuilding from their bankruptcy, to becoming debt-free multimillionaires.

Her dad went on to become the host of The Dave Ramsey Show, a money management radio show and podcast that reaches more than 12 million people per week. It’s central message is to budget carefully and avoid debt.

Despite their success, the Ramseys committed to raising money-smart kids. They didn’t want their children to become lazy or entitled. Rachel paid for toys as a child. She partially paid for her car as a teenager. She worked throughout college.

Rachel, now in her late 20’s, grew up to become an accomplished speaker and New York Times bestselling author. She and her father co-authored the book Smart Money, Smart Kids, which reached the number one spot on the NYTimes bestseller list. Her latest book, Love Your Life, Not Theirs, is also a mega-bestseller.

In this episode, Rachel describes the lessons she learned about saving, spending, budgeting, debt and giving as the daughter of Dave Ramsey.

We discuss “Instagram envy” -- the act of comparing your life to someone elses’ -- and how to avoid the traps of consumerism and materialism.

Read the full show notes -- and download a FREE gratitude worksheet -- at http://affordanything.com/episode115

Feb 05, 2018
#114: Ask Paula -- How Should I Invest $100K in Real Estate?
58:59

This week, I answer four questions about real estate investing from the audience.

Joelle asks: I own a home outright on the West Coast. I’m thinking about taking out $100,000 from my home equity, and using this money to buy a rental property. I found a community out east where I can buy a property outright in cash for $100,000 in a good neighborhood. Should I pay cash for one house (via the home equity loan)? Or should I split this $100,000 into multiple down payments on many homes?

Yasin asks: My wife and I are living on one income and investing the other. We save $60,000 per year. We’re looking at duplexes in Minnesota that cost $160,000 to $180,000. Our plan is to purchase a duplex, move into one unit, rent out the other, and aggressively pay off the mortgage in about 1.5 years. We’d move out and repeat this process until we have $7,000 per month in passive income, at which point we’d be financially independent. Should we pursue this plan? Or should are we playing it too safe? Should we buy more properties upfront, rather than waiting for two years between each purchase?

Anonymous asks: I own four rental properties, each of which have an average rent of $1,350 per month. I purchased all of my properties within the past 24 months, and each one has been recently renovated. My goal is to own 20 rental properties. I’d like to make sure that I have adequate cash reserves, in case of emergencies. Each of my properties have insurance with a $5,000 deductible. How much money should I keep in cash reserves? What factors should I consider?

Kim asks: I own one rental property. I recently moved into a single-family home in Scottsdale, Arizona, with the intention to live here for one year and then make this my second rental property. My mortgage is $1,500 per month, and I could collect rent of $2,250 per month – or more, if I Airbnb it. The neighborhood is booming; the housing here is appreciating at an astronomical rate. However, I’m concerned about the longevity of the plumbing in my current home, which was built in 1960s. I may have an expensive repair on the horizon. Here’s my question: Should I hold onto this property, despite the looming repair bills, and turn this into my second rental property? Or should I live in this home for two years and then sell it, cash out, and repay all my student loan and consumer debt? I hold a $60,000 student loan, $7,000 in vehicle loans, and $5,000 on a credit card. My goal to own many cash-flowing properties.

Anonymous asks: A year ago, I relocated to Silicon Valley. I’m thinking about buying a townhouse-condo hybrid. I like the neighborhood and it suits my family’s needs. The property will become a rental in 5-7 years. It’s in a distressed area and could see a lot of potential appreciation. What loan should I consider, given that this property will become a rental within 5-7 years? I’m debating between a 7/1 ARM or a 30-year fixed rate mortgage. Also, should I redirect most of my income to paying off the principal as quickly as possible? There are two schools of thought on this: (1) build equity and use a HELOC to buy another property in 5-7 years, or (2) make only the minimum payments on your mortgage. What do you think?

Tune in for the answers!

Jan 29, 2018
#113: How I Run a Six-Figure Business and Host an Airbnb while Traveling the World -- with Natalie Sisson
55:45

Natalie Sisson was tired of the corporate world. She wanted freedom, adventure and fulfillment.

In 2008, she quit her job and co-founded a tech company -- but soon she discovered that running a company felt a lot like having a day job.

Two years later, she quit her own company in order to truly strike out on her own.

Since 2010, Natalie has run an online business from her laptop while traveling the globe. She's visited 70 countries, living out of a suitcase while running a lucrative six-figure business.

She also owns investment real estate in Portugal and New Zealand.

In this interview, Natalie and I discuss:
- The four phases of entrepreneurship: The Dreamer, The Hustler, The Superhero and The Freedomist.
- Why Natalie transitioned from a steady paycheck to the financially volatile life of an entrepreneur.
- How Natalie coped when her bank account dwindled to her last $17.
- The major family crisis that reinforced why freedom and flexibility matter more than any job.
- How she bought a property in a foreign country.
- How she manages an Airbnb rental property from halfway around the world.
- Why a minimalist attitude towards possessions is crucial for a traveler and entrepreneur.

Enjoy!


Visit http://affordanything.com/episode113 for more information

Jan 22, 2018
#112: Ask Paula - How to Convince a Spouse to Invest in Low-fee Index Funds?
49:01

How can I convince my spouse to invest in low-fee index funds? How should my fiancé and I combine our finances? If I'd like to invest in rental properties, should I also buy stocks?

Former financial planner Joe Saul-Sehy joins me to tackle these audience questions and more.

Thomas asks:
My wife is suspicious of Vanguard. She questions how they could stay in business while charging low fees -- isn't there a catch?

She's also reluctant about investing the majority of our money in a broad-market index fund like VTSAX. She'd prefer more diversification.

Recently, we met with a major brokerage firm that charges a 1.75 percent management fee. How can I get my wife to see the detrimental effects of choosing this high-fee broker?

Shy asks:
My fiancé and I are getting married soon. We both live with our families at the moment; we'll form a new household after our wedding.

Neither of us has ever lived independently before. How should we budget for this, given that we're not sure what expenses to expect?

Also, any tips on how to commingle finances?

Paris asks:
I'd like to invest in rental properties. Should I still make stock market investments? Should I contribute to a 401k?

Kristin asks:
I've been DIY'ing my household's finances and taxes. So far, our situation has been simple.

However, in a few years, my husband is going to retire. When this happens, we'd like to sell our home, perhaps invest in rental properties, and move either out-of-state or out-of-country.

Our financial and tax situation is about to become a lot more complicated.

I'd like to talk to a financial professional ... but whom should I choose? Should I hire a financial coach? a financial planner? an accountant? an investment advisor? someone else?

We tackle these four questions on today's show. Enjoy!

______

Resources Mentioned:

Thomas:
Calculator - How do expenses impact fund returns?
https://www.calcxml.com/do/inv12

Article - How a 1% fee could cost $590,000 in retirement savings
https://www.nerdwallet.com/blog/investing/millennial-retirement-fees-one-percent-half-million-savings-impact/

Article - The Impact of Investment Costs
https://investor.vanguard.com/investing/how-to-invest/impact-of-costs

Shy:
Article - The Anti-Budget
http://affordanything.com/2013/03/05/anti-budget-or-80-20-budge/

Article - Three Methods for Co-Mingling a Couple's Finances
https://www.thebalance.com/three-methods-for-co-mingling-a-couple-s-finances-453849

Kristin:
FINRA Broker Check website
CFP.net
Guidevine (website)
XY Planning Network

Jan 15, 2018
#111: How We Retired at Age 38 and 41 -- with Tanja Hester & Mark Bunge
55:30

Tanja Hester and Mark Bunge used to have demanding but fulfilling careers as political and social cause consultants.

While they loved the mission behind their work, they grew tired of the exhausting hours and grueling travel. Their home felt like a weekend crash pad. They had no time or energy to pursue outside passions like skiing, biking and volunteering.

Six years ago, they read a book that changed the course of their lives.

The book, How to Retire Early, set the couple on the path of financial independence. They moved from pricey Los Angeles to the more affordable North Lake Tahoe. They started automatically saving and investing huge chunks of their paycheck. They crafted detailed spreadsheets, plotting precisely how much they'd need to save before they could comfortably quit their jobs.

Today, Tanja and Mark are newly-retired ... at the ages of 38 and 41.

How did they progress towards early retirement so quickly? And what lessons would they share with anyone else who wants to escape the 9-to-5 grind?

Find out in today's episode.

 

For more information, visit the show notes at http://affordanything.com/episode111

Jan 08, 2018
#110: Ask Paula -- Get Ready for the Next Recession
50:45

Happy New Years! We're kicking off this year on a bright and cheerful note -- with a conversation about the impending recession! Yay!

The U.S. stock market is at a peak, continuing its 9-year bull run. The markets have been rising since March 2009 without any major corrections or pullbacks.

We are living in one of the longest periods of economic expansion in our nation's market history.

That's worrisome.

Speculators with short memories are popping champagne corks thinking the good times will last forever, while those of us who are students of history know that what goes up must come down.

Trying to guess WHEN the next recession will happen is a waste of time. A more efficient use of time is to prepare ourselves such that when it does happen -- whenever that may be -- we are ready.

How can we prepare for a recession? That's one of the four topics I cover in today's episode.

Specifically, here's what we chat about in this first episode of 2018:

Thayne asks:
1) Broadly -- What are the best investments overall if you're
going into a recession?

2) Specifically -- What's the most recession-proof type of real estate investment?

Aaron from Portland, Oregon asks:
In Episode 96, you discussed the benefits of real estate investing -- but you didn't mention the use of leverage, nor did you mention that real estate is an inefficient market. Why not?

Anna from the San Francisco Bay Area asks:
I've moved out of my condo, which I'm renting out. But the rent only covers the mortgage (PITI) and HOA. Should I sell the condo? If so, I could use $250,000 in equity for an alternate investment, such as buying rental properties out-of-state.

Enjoy!


_____
Resources Mentioned:
How to Calculate Cap Rate and Cash-on-Cash Return --
http://affordanything.com/2012/01/25/income-property

 

Jan 01, 2018
#109: How to Create a Complaint-Free World -- with Will Bowen
38:31

Happy holidays! I thought it would be nice to wrap up this year with a lighthearted holiday episode about the importance of keeping a positive attitude.

Will Bowen, my guest on the final episode of 2017 (wow!), started a campaign to motivate people to complain less.

He noticed that many people in his community said they wanted more stuff -- more possessions -- but they complained about what they already had.

So he wondered if perhaps people could find happiness not by purchasing more, but rather by complaining less.

In this episode, he discusses how we can move towards a complaint-free lifestyle.

I thought this would be a cheerful, light interview to round out this year. Enjoy, and happy holidays!

- Paula

 

For more information, visit the show notes at http://affordanything.com/episode109

Dec 25, 2017
#108: Ask Paula - I Don't Know How to Invest
48:01

Former financial advisor Joe Saul-Sehy joins me to answer audience questions about investing strategies, early retirement, and tax planning.

Whitnee calls in with this:

I'm 31, and my husband and I save half of our combined income. We've maxed out our H.S.A. accounts and we're getting an employer match in our 401k. We have $80,000 stashed as cash in a checking or low-yield savings account.

We're paying nearly $2,000 per month for insurance policies, most of which is a whole life insurance policy. We have a rental property that cash flows $210 per month; we pocket $150 and use the other $60 as an extra principal payment.

What should we do differently? How can we learn about investing? What funds should we focus on? Should we sell our rental property and invest the proceeds, or hold onto this? If we hold, should we focus on repaying the mortgage as quickly as possible?

Kim asks about the 4 percent withdrawal rule in early retirement. When you're calculating your savings goal, do you need to account for the tax implications of this withdrawal? Any tips on how to optimize this?


Susan says:
I loved your explanation about how to use a Roth Conversion Ladder to avoid paying stiff early-withdrawal penalties in retirement. (Episode 94).

Here's my follow-up question: How long should my money sit inside of a Traditional IRA before I convert it to a Roth IRA?


We tackle these three questions on today's episode. Enjoy!

_______________________________________

Resources Mentioned:

Whitnee's question:

Books:
Investing Made Simple by Mike Piper
Can I Retire? by Mike Piper
The Simple Path to Wealth by JL Collins
The Little Book of Common Sense Investing by John Bogle
The Wealth Barber by David Chilton
The Truth About Money by Ric Edelman

Websites:
Oblivious Investor by Mike Piper
FINRA Broker Check
Afford Anything article: I Don't Know How to Start Investing and I'm Afraid of Expensive Mistakes


Kim's question:
Two articles critiquing the 4 percent withdrawal rule:
- https://www.americanfunds.com/ria/insights/can-i-retire-at-40.html?cid=sm_tw_50306
- https://www.cnbc.com/2014/11/03/the-4-retirement-rule-is-broken-and-heres-why.html


Susan's question:
Episode 94 - The Early Retirement Episode

Dec 18, 2017
#107: How Scott Harrison Brought Clean Water to 7.3 Million People
01:09:20

Scott Harrison spent 10 years as a New York City nightclub promoter, partying until sunrise every morning and ingesting almost every substance imaginable.

But when he was 28, he realized his life lacked meaning.

"My tombstone might say, 'here's the guy who got thousands of people drunk,'" Harrison said.

Feeling lost, he decided to volunteer for a medical charity in Liberia.

Harrison spent the next year-and-a-half in West Africa, where he encountered people with diseases he'd never seen before -- such as cholera, typhoid, dysentery, and fatal cases of diarrhea and dehydration.

He smelled the yellow-brown parasitic dirty water that millions of people were drinking. He discovered that unsafe, unclean drinking water is the world's leading cause of death.

When he returned to New York City, he couldn't bring himself to sell expensive bottled water at nightclubs anymore.

Instead, Harrison moved into a tiny closet and launched a nonprofit, Charity: Water.

Today, Charity: Water has funded more than 24,000 water projects that have brought safe, clean drinking water to more than 7.3 million people.

That's the good news.

The bad news? There are still 663 million people without access to clean water. That's around double the population of the U.S.

And water-borne diseases kill about 16,000 people each week, almost half of whom are children under age 5.

There's still a long way to go.

Today, Scott joins me on the podcast to talk about how he started and grew a major charitable organization.

- How does a nightclub promoter with zero business experience launch a massive nonprofit organization?
- What mistakes did he make?
- How did he differentiate his organization from the thousands of other charities out there?
- Who did he first hire?
- What advice would he offer to anyone who's goal is to create a nonprofit?

Learn the answers to these questions and more in this excellent episode with Scott Harrison, the founder of Charity: Water.

_____

Resources Mentioned:

Charity Water -- Short Film
http://charitywater.org/thespringfilm

Charity Water - Projects
https://www.charitywater.org/projects

World Health Organization - Drinking water fact sheet
http://www.who.int/mediacentre/factsheets/fs391/en

Dec 11, 2017
#106: Ask Paula - How to Estimate Repair Costs, File Taxes on Rental Income, and More
01:06:56

How do you search for rental properties out-of-state? Should I offer a lease-option contract to my friends? How can I estimate repair and maintenance costs? And can you deep-dive into bookkeeping and taxes for rental real estate?

I tackle these four questions in this episode of Ask Paula - real estate edition.

 

Saul from Salt Lake City asks:

I'm converting the first floor of my home into a two-bedroom, one-bath apartment. My "hacked duplex" will soon be ready for my first tenant.

Can you deep-dive into the taxes and accounting? How should I keep records of my expenses, and what should I file?

 

Terri asks:

I'm analyzing real estate deals, but I'm getting stumped about how to estimate the repair, maintenance and capital expenditures.

It seems like everyone has a different approach for calculating this. Should I estimate a percentage of the purchase price? A percentage of the rental income? A flat amount per unit? Or something else? How can I estimate costs accurately?

 

Kirsten from Madison, Wisconsin asks:

My husband and I recently moved to Madison, but we've kept our old home in Oshkosh, Wisconsin. The home is worth $120,000, and we have a 15-year note.

Our friends would like to purchase that home, but their credit is bad. They'll need two years to improve their credit situation.

 

We're considering renting to them through a lease-option contract. Our mortgage is $950 per month; we're thinking of charging them $1,100 - $1,200 per month on a rent-to-own lease. Do you think this is a good idea?

 

Chrissy from North Vancouver, Canada asks:

I loved your description in Episode 92 about building a team in a different state.

Could you please further flesh out the steps that you use when you're searching for a rental property in a different state?

I tackle these four questions in today's episode. Enjoy!

 

 

For more, visit the show notes at http://affordanything.com/episode106 

Dec 04, 2017
#105: Life as an Experiment -- with A.J. Jacobs
55:41

A.J. Jacobs is the Editor-at-Large of Esquire Magazine and the New York Times bestselling author of multiple books. His three TED Talks have collectively garnered more than three million views. He describes himself as "a father of three, husband of one, and cousin to millions."

And he's probably your cousin. Twice removed.

AJ joins me on this episode to chat about motivation, habits, and living life as an experiment.

Here are some of the stories we cover:

- Why AJ divulged his entire sexual history to actress Scarlett Johansson.
- How AJ successfully and frequently changes his behaviors and habits.
- AJ's experimental approach to life.
- Why the adage "fake it 'til you make it" -- or rather, "fake it 'til you become it" -- is essential for developing habits.
- How gratitude at extreme levels can become a mindset game-changer.
- How healthy living nearly killed him.
- AJ's quest to demonstrate the idea that we're all related -- and throw the world's largest family reunion.


Resources Mentioned:

  • A.J.'s Books:
  • It's All Relative
  • My Life as an Experiment
  • A Year of Living Biblically
  • Drop Dead Healthy
  • The Know-It-All

A.J.'s TED Talks:
My Year of Living Biblically
https://www.ted.com/talks/a_j_jacobs_year_of_living_biblically

How Healthy Living Nearly Killed Me
https://www.ted.com/talks/aj_jacobs_how_healthy_living_nearly_killed_me

The World's Largest Family Reunion
https://www.ted.com/talks/aj_jacobs_the_world_s_largest_family_reunion_we_re_all_invited

 

Nov 27, 2017
#104: Ask Paula - How Can I Learn about Money from the People Around Me?
36:36

This week, I answer 4 questions about quitting a depressing job, learning how to ask probing questions, saving for a downpayment, and more.

Edward asks:
How can I learn from other people around me? I'm 28, and my wife and I have some money that we'd like to invest. We know people who've had both successes and losses in the investing world, but when I ask them questions, they tend to become a little more private and shy away. How can I encourage them to open up, so that we can learn from them?

Sara asks:
For the last 2 years, my husband and I have lived on one income and used the other to pay off our student loans. We also saved $40,000 to make a downpayment on a house.

We need to move to England for 2 years, and we'll buy a house when we return to the U.S. In the meantime, what should we do with the $40,000 downpayment that we've saved?

We'd hate to see the money in a savings account, but it doesn’t seem wise to invest in index funds. What should we do?

Britney asks:
I’m at a job that I hate. I’d like to start a small business and find other part-time work so that I can quit my job.

I’m planning to move in with my in-laws, so my cost-of-living will be low. Do you recommend that I start a blog as a side hustle, so that I can pay the bills after I quit my job?

A listener in the Midwest asks:
I’m a 37-year-old single woman living in the Midwest. I live in a one-bedroom with my 5-year-old son.

I bring home $3,800 per month. My rent is $1,150 and my son's preschool is $700 per month. I have $40,000 in retirement savings and a $3,000 emergency fund.

I don’t want to be making rent payments in retirement. Should I take $20,000 from my 401k to make a downpayment on a rental property?

____


I answer these questions in today's episode. Enjoy!

For more, visit the show notes at http://affordanything.com/episode104 

Nov 20, 2017
#103: Random Smattering of Lessons on Money, Work and Life — plus A Call for Radical Authenticity
54:01

On today’s podcast, I'm sharing this random smattering of lessons on money and life.

1) Simplify everything.

2) Risk = Probability x Magnitude.

3) Curate.

4) Never delay gratification.

5) Know your net worth, relative to your lifetime earnings.

6) Don't half-ass anything. (Whole-ass a few things.)

7) When you're not at work, don't be at work.

8) Yes, and.

9) Money can't make you happy, but a lack of money can make you unhappy.

10) Every conversation about money is really a conversation about values.

11) The less you try, the better.

12) Work with your nature, not against it.

13) The thing should be its own reward.

14) Practice radical self-reliance.

15) Achieve being through doing.

16) What is stated, happens.

 

I elaborate on each of these in today’s episode. In addition, I’m also sharing my mini-keynote from FinCon on the importance of authenticity and passion in online business.

 

Enjoy!

 

You can subscribe to show updates at podcast.affordanything.com -- just throw your email address into that big box above-the-fold.

Nov 13, 2017
#102: Ask Paula - Should I Sell My Rental Property and Invest the Proceeds in the Market?
53:56

This week, I'm back to answering questions posed by listeners of the podcast.

An anonymous listener asks:

Should we continue to rent out our home, or should we sell it? We bought a home in California but have since moved to New York and have been renting there. After all expenses on the rental are accounted for, we receive $150/mo in profit. We estimate that even with repairs factored in, we'll still be in the positive.

However, my husband thinks it's better to sell the property and invest the profits. I think we're better off keeping the house and having someone else pay the mortgage. Who has the better idea? What would you do?

 

Jessica asks:

My husband and I are about to relocate from the mid-west to Colorado Springs, and we anticipate making $80,000 from the sale of our house.

Should we take the proceeds from the sale and put it toward our next home? Or should we put that money in index funds instead?

For context, we plan on buying either a duplex or triplex, or doing a fix-and-flip like we did with our current home.

Terri asks:

How can I find a good real estate agent - especially one who is good with short sales and foreclosures? What are the signs of a good real estate agent?

Laura asks:

My husband and I currently own a three-family home (in which we live on the bottom floor), but in light of getting a new job that requires me to commute an hour each way, we are thinking about either converting the three-family home into three condo units and selling them, or buying another house and keeping the three-family home as a rental.

There's another factor to consider, though: the property is located on a peninsula, and with sea levels rising, we don't think it has long-term potential (in terms of equity).

What should we do?

 

For more, visit the show notes at http://affordanything.com/episode102 

Nov 06, 2017
#101: The Code of Trust, with Robin Dreeke
51:56

Robin Dreeke is former head of the FBI’s Counterintelligence Behavioral Analysis Program.

His primary role, at the time, was to thwart foreign spies and  recruit American spies. That's not an easy task.

To accomplish this, Dreeke needed to gain people's trust -- even when they had no reason to trust him.

He spent years developing and testing systems on how to develop trust with others in high-stakes situations.

Today, he joins us on this podcast to describe The Code of Trust, a set of practices that he developed during his days as a high-ranking counterintelligence expert.

 

This system is based on 5 simple principles:

  1. Suspend Your Ego
  2. Be Nonjudgmental
  3. Honor Reason
  4. Validate Others
  5. Be Generous

 

Tune in to hear him elaborate on each principal, and discuss how this applies to anyone who wants stronger, more trustworthy relationships at work and home.

For more information, including links to resources mentioned in this episode, visit http://affordanything.com/episode101 

Oct 30, 2017
#100: Life After Financial Freedom, with Brandon - the Mad FIentist
54:30

Over a year-and-a-half and two million plus downloads later, the Afford Anything podcast has hit another awesome milestone: the 100th episode!

To celebrate, I recorded this one live from Ecuador with my good friend Brandon, otherwise known as the Mad FIentist.

If you've been a listener since the early days, you may remember Brandon from episode #7. He was the first guest to appear on the podcast, and I'm thrilled to have him back on for round two!

In this episode, we focus on life after financial freedom:

  • What projects has Brandon been working on?
  • What are the biggest lessons he's learned from being FI so far?
  • How does he maintain motivation to get things done now that money isn't an issue?
  • What does a typical day look like for Brandon?
  • How Brandon's wife became a FIentist after some initial resistance.
  • Why full-time travel after FI didn't work out for him
  • and more!

Enjoy, and thanks for listening!

For show notes, go to http://affordanything.com/episode100 

Oct 23, 2017
#099: How I Grew BiggerPockets From 0 to 870,000 Members - with Joshua Dorkin
01:00:01

Thirteen years ago, Joshua Dorkin's friends teased him about starting a website that seemed to have no future.

"I would get calls from my buddies who would literally call me on my cell phone [and say] 'Hey Josh, we just walked past a penny on the ground. We were thinking about picking it up and mailing it to you."

At the time, Dorkin had just launched BiggerPockets, a then-nascent website about real estate investing.

"I was working a full-time job making no money as a teacher," Dorkin says, "... and then [I] quit that job, reliable income, to blindly create this platform for other people. And I was helping other people get rich, and I was broke."

Dorkin spent the next 8 years working mostly as a one-man operation as he tried to monetize a fledgling website.

"We were struggling and scrapping by on every AdSense check that we could collect," Dorkin says. "The business really wasn't making serious money for probably getting close to a decade."

The story has a happy ending. Today, BiggerPockets has grown to more than 870,000 members. The podcast has almost 250 episodes and the blog features more than 8,100 articles.

In today's episode, I have a heart-to-heart with BiggerPockets founder Joshua Dorkin about the blood, sweat and tears that's required to start a successful online business. What lessons did he learn along the way? What regrets does he hold? And what advice would he share with other aspiring online entrepreneurs?

We don't talk about real estate investing in today's episode. Instead, Joshua and I focus on the harsh realities of growing an digital empire.

Enjoy!

 

You can find more information in the show notes at http://podcast.affordanything.com/episode99

Oct 16, 2017
#098: Ask Paula - The Side Hustle Episode
43:01

How much money should you invest in a side hustle or side business?

How do you know if your side hustle idea is viable?

What if you want to start 5 or 6 side businesses?

Should you lump these together under a common business umbrella? Or should you separate them out?

These are the questions about side hustles -- asked by listeners Adalia and Brionna -- that I answer in today's episode.

My friend Joe Saul-Sehy from the Stacking Benjamins podcast joins me to chime in with his views on building side businesses, as well.

Joe and I also answer two non-side-business-related questions, as well.

Skye asks: -- You talk about saving 50 percent of your income. What exactly does this mean?

Steph asks: -- I have $10,000 in credit card debt and $48,000 in student loans at a 5 percent interest rate. I have a $1,000 emergency fund and $32,000 in retirement funds. My dad is willing to give me money to repay my student loans; should I accept this? And if so, should I put this money towards student loans or retirement?

We tackle these questions on today's episode.

Enjoy!

Links and more resources can be found in the show notes at http://podcast.affordanything.com/episode98

Oct 09, 2017
#097: How to Be Awesome at Your Job, with Pete Mockaitis
01:00:45

How can you be awesome at your job?

That's the question that today's guest, Pete Mockaitis, and I tackle on the latest Afford Anything podcast episode.

Pete hosts one of iTunes' top 10 career podcasts, called -- appropriately -- How to Be Awesome at Your Job.

In typical nerd fashion, I launch our interview by asking him: "What is the metric by which 'awesome' is determined?"

Here are a few other questions that I hurl his way:

How to Get a Raise: Imagine that you enjoy your job; you don't want to quit. But they're not paying you what you're worth. You've asked for a raise, several times, and they've said no. What do you do?

Angle for a Promotion? Or Focus on a Side Hustle? Let's assume that you're employed full-time, and your goal is to make more money. What's more effective: [Option 1] Focus on your full-time profession, putting in the extra hours to angle for a promotion? -- OR - [Option 2] Be an average employee and focus your excess time and energy on building a side hustle?

Tough it Out, Then Retire Early? Or Not?: You feel ambivalent about your job, but it pays well. Should you pivot to an alternate career path, even if this causes an income drop? Or should you milk the big paycheck for 10 years, save and invest like crazy during that time, and escape into an early retirement?

 

What nuggets of wisdom does Pete share in today's episode? Here are six takeaways:

#1: If you want to be awesome at your job, focus on these six areas:

1. Be present.
2. Be deliberate about how you direct your time, energy and attention.
3. Be thoughtful.
4. Communicate well.
5. Build strong relationships.
6. Manage your career.

(We dive deeper into these points -- especially number two! -- in this episode.)

#2: Apply the 80/20 rule to your decisions. Ask yourself:

- What are the 80 percent of great results coming from 20 percent of my efforts?
- What are the 80 percent of negative things that I don't like? What focused 20 percent of efforts can get rid of 80 percent of the negative?

#3: "Wastefulness comes from inefficient methods in pursuing things."

#4: Invent what people want. Not what you think they should want.

#5: Learn the 2 questions that improve every decision: What must be true for this to be a good decision? How can I test that?

#6: How can you find happiness at work? You'll need to be satisfied with RED: rewards, experience and demands.

Rewards - Your compensation, security, advancement potential, and your pride in the organization and its activities.

Experience - Your day-to-day experience at work, appreciation from others, enriching and psychologically safe environment, compelling tasks, sense of purpose, learning and growth, and autonomy.

Demands - What are total hours needed and the flexibility of those hours?

Find more at http://affordanything.com/episode97

Oct 02, 2017
#096: Ask Paula - Should I Be an Out-of-State Airbnb Host?
42:15

Today I tackle 4 real estate questions that come from the listeners.

Chris, age 25, says:

Over the next 30 years, I'd like to acquire 15 rental properties. Then, at age 55, my wife and I can retire and travel.

To begin, I'd like to buy a duplex, live in one unit and rent the other on Airbnb. Once I gain some equity and save enough for another downpayment, I'd like to purchase another duplex, move in, and repeat this process.

However, I'm reluctant to get started for one reason.

There's a decent chance that I'll need to move out-of-state within about a year or two. I don't want to be an out-of-town Airbnb host. Should I follow this plan, even though there's a good chance I might move away soon?

__

The next caller, who remains anonymous, says:

I love your rental property income reports; they give me a great understanding of your numbers.

But you have economies of scale on your side. Your payments to your accountant, attorney, bookkeeping software, etc., are spread out across 7 rental units.

When I start investing, I'll only have one unit.

How well would your worst-performing property fare if it was your *only* property, and you had no other economies of scale?

__

The third caller, "Anonymous from Orlando," says:

I own my house free-and-clear, and I'd like to buy another one. Should I take out a conventional mortgage on my second home? Should I cash-out refinance the equity in my first home? Or should I open a HELOC?

__

Finally, our last caller asks:

I'm interested in rental property investing, but I don't want to deal with any hassles. Should I use a turnkey company?

Tune in to find out the answers!

- Paula

Find resources to things mentioned in this episode at http://affordanything.com/episode96

Sep 25, 2017
#095: Money for the Rest of Us, with JD Stein
54:40

J. David Stein used to manage billions of dollars. He retired at age 46. Now that he's retired, he faces a different challenge:

  • How should he invest his own money?
  • What investing philosophy should he follow in his own life?
  • And what can we learn from that?

Stein, who now hosts a podcast called Money for the Rest of Us, joins me on today's show to talk about his big-picture investing ideas.


For a list of my takeaways, go to http://affordanything.com/episode95

Sep 18, 2017
#094: Ask Paula - The Early Retirement Episode
43:22

Early retirement? Yes please. This week, I answer questions from the audience community around early retirement planning, health savings and debt pay-off.

  • I'm interested in early retirement. How can I avoid early withdrawal penalties?
  • How does early retirement impact the 4 Percent Rule?
  • Should I use an HRA or an HSA?
  • How do I open a Roth IRA?

If you’re into early retirement, don’t miss today’s episode.

For complete resources and show notes, go to http://affordanything.com/episode94

Sep 11, 2017
#093: The Secret Lives of Introverts - with Jenn Granneman
48:48

Do you enjoy spending time alone? Does your inner monologue chatter constantly? When you were a student, did you sometimes stay quiet even when you knew the correct answer?

Do you avoid confrontation? Does small talk bore you?

Have people told you that you're "too intense" or that you "get deep quickly?"

Do you live inside your head?

Do people see you as a good listener? Do you rarely interrupt others?

Are you better at writing thoughts than speaking them?

Are you good at focusing for long periods on tasks that you're really interested in, but totally checked out of tasks that bore you or that feel superficial?

If so, you might be an introvert. And today's episode might be for you.

If you'd like to learn how to thrive in any pursuit -- like starting a business, traveling the world or becoming an investor -- tune in to learn how to use your natural tendencies to your advantage.

For more information, including links to resources mentioned in this episode, go to http://affordanything.com/episode93

Sep 04, 2017
#092: Ask Paula - How Do I Hire an All-Star Rental Property Team?
36:41

If you're interested in real estate investing, and if you've wondered how to assemble an all-star team, today's episode is for you.

I'm hosting another edition of Ask Paula, in which I tackle three audience-submitted questions about building a team as a real estate investor.

Salome from Cincinnati asks: Who are the people I'll need on my real estate team? How much will I spend in paying them? And how can I find them?

Doug from Louisiana asks: I've saved $20,000 as the downpayment on a rental property. Should I use this money? Or should I look for a loan that can cover a larger chunk of the financing? Also, how should I look for a tenant? Should I handle this myself, or hire a property manager?

Patricia from California asks: I live in Bay Area. I cannot buy a house here. I want to buy a rental property in Baton Rouge, Louisiana, and I've identified the specific property/neighborhood in which I want to invest. How can I start assembling a team from out-of-state?

For a full list of resources from this episode, visit http://affordanything.com/episode92

Aug 28, 2017
#091: How to Spend Less, Earn More and Grow the Gap
46:46

Grow the gap between your income and your expenses: How to tackle the 4 biggest expenses in the average American household budget.

Also, I share non-obvious tips on how to trim back on these costs.

Enjoy!

Paula For more details on this presentation, go to http://affordanything.com/episode91

Aug 21, 2017
#090: Ask Paula -- I'm Tired of Paying Rent. Should I Buy a House?
44:00

Curious about real estate investing?

I'm rocking the microphone solo on today's episode, tackling the rental property questions that you -- the listeners -- have asked.

Rachel from the Ozarks asks: I'm inspired to start investing in real estate. I live in the Ozarks region, and the cap rates around here are fantastic. However, the online reviews for local property management companies are consistently terrible. What should I do if I can't find a good property manager?

Daan from Malaysia asks: I'm a Dutch national who plans to be a global nomad for the next 10-15 years. I live in Malaysia at the moment, and I plan to continually travel internationally for my work. Many people in Asia are investing in real estate; do you have any recommendations for choosing investments abroad?

A caller who wants to stay anonymous asks: I live in Denver and I'm tired of paying rent. I'd like to buy a house and eventually collect rental income from it, as well. But I'm having trouble saving enough money for a downpayment. Should I just give up? What should I do?

Tom asks: I own land free-and-clear. Should I build on that land? Or should I buy a property that already exists?

Finally, I tell the story of my most recent bout of lifestyle inflation. It involves sleeping in the back of my car. :-)

Enjoy! - Paula

For more information, visit the website at http://affordanything.com/episode90

Aug 14, 2017
#089: Imagine You Only Have 10 Years to Live ...
42:41

Imagine you’re financially secure. You have enough money to support yourself, your family and pursue your dreams. You’ll need to continue working, but it’s fulfilling work with a reasonable schedule. What would you do with both your time and money?

Next, imagine you’re financially independent. You DON’T need to work anymore. Your investments create enough money to support yourself and your family. What would you do?

Okay, let's shake things up. Imagine you visit your doctor, who tells you that you only have 5-10 years to live. You’ll never feel sick, and you’ll have no advance notice of the moment of your death. Your financial position is the same as it is today. What would you do?

Now imagine the same scenario as before -- you have 5-10 years to live -- but in this scenario, you have unlimited funds. What would you do?

These are 4 of the 11 questions about money and life that I asked a crowd of 100+ people at the World Domination Summit. I share the rest of the questions on today's episode. Get Rich Slowly founder J.D. Roth also joins me on this episode to discuss building a fulfilling life.

For more, visit http://affordanything.com/episode89

Aug 07, 2017
#088: Ask Paula - When is Lifestyle Inflation a Smart Business Decision?
42:00

Former financial planner Joe Saul-Sehy and I answer 4 questions from the Afford Anything community.

We chat about how to control lifestyle inflation, how to break up with a financial planner, how to invest your first $10,000, and whether or not sector-specific or theme-specific funds are a good idea.

#1: Laura is transitioning to a new job, and she's discovered that her new responsibilities require some lifestyle inflation. She needs work-appropriate clothing, for example; she can't wear leggings everyday anymore. She and her husband are going to need two cars, instead of one. And she's ordering restaurant delivery more often, because she doesn't have time to cook.

She recognizes that lifestyle inflation is unavoidable, and she's curious: what's legitimate and what's not? What's the difference between healthy lifestyle inflation vs. over-the-top upscaling?

#2: Nakia wants to "divorce" her financial planner. But she's not sure how to break the news gently. Her financial planner is a friend and neighbor; their kids are friends. What should she say?

#3: Megan and her husband both want to retire early. They have saved $10,000, which they'd like to invest in the Vanguard Total Stock Market Index Fund, Admiral Shares (VTSAX). This fund requires a minimum of $10,000 as an initial investment.

Should they put this money into a taxable brokerage account, so that they can access this in early retirement? Or should they save more and then each open an IRA?

#4: Nancy is a single mom with a five-year-old son. She recently transitioned into a lower-stress lifestyle, but as a result, her income dropped significantly.

She's a beginner investor without much money, and she's curious about Motif Investing, a platform that focuses on sector-specific and thematic investments. Would this platform be right for her?

Enjoy!

 - Paula



Resources Mentioned:

FINRA website -- Broker Check https://brokercheck.finra.org

MadFientist article on how to access retirement funds early
http://www.madfientist.com/how-to-access-retirement-funds-early

Jul 31, 2017
#087: Myths about Money - Are Your Ideas Holding You Back?
49:41

A week and a half ago, I flew to Portland for the World Domination Summit -- a conference with an admittedly eyebrow-raising title.

The conference is hosted by Chris Guillebeau, the New York Times best-selling author of multiple books, including The Art of Non-Conformity. He was also a previous guest on this podcast.

I've wanted to check out WDS for years, so I was thrilled when Chris asked me to give a presentation there.

Then he mentioned that my presentation should be three hours long, which sounded terrifying. But that's all the more reason to say yes.

I choose my own eyebrow-raising topic, How to Afford Anything, and ... promptly procrastinated on planning for several months. Yeah, that definitely happened. #guilty

Then, at the beginning of July, I flew into a frenzy, called a few friends for advice, scanned over several books, watched multiple talks for inspiration, and isolated myself in a remote, empty house for several days. (Past guest Cal Newport would call this a "deep work retreat.") The result was a half-day workshop that synthesized many of the ideas about money that I've formed after six years of nonstop reading, writing, talking and thinking about this topic.

In today's episode, I share the first part of this presentation. Today's episode focuses on myths, assumptions and limiting beliefs that we hold around money, work and life.

This is the first of a three-part series. In episodes 89 and 91, I'll share the second and third parts of the talk.

You can catch the slides (and watch this as a video) on http://YouTube.com/affordanything

Enjoy!

Jul 24, 2017
#086: Ask Paula - Should I Keep My Properties in an LLC
29:50

The real estate questions keep coming in, so today I’m answering questions from three Afford Anything listeners:

Heather is ready to buy her first rental property. She wants to acquire about one house per year, following a buy-and-hold strategy.

Salome and her husband are renting out an unused room in our house on Airbnb. We're interested in venturing into buying rental properties later.

Then Caren talks about coming across several real estate investing clubs, or memberships, in which the organization pulls together a list of various contractors and property managers. What are Paula’s thoughts and experiences with these types of things?

For a full list of show notes and resources, visit http://affordanything.com/episode86

Jul 17, 2017
#085: How to Make Money without a Job -- with Nick Loper from Side Hustle Nation
01:00:00

Like many people, Nick Loper used to work a full-time job that didn't excite him.

Unlike most people, Loper decided to escape his uninspiring work life.

First, he launched a shoe-comparison website that began collecting side income. Over time, this side project grew increasingly profitable, until -- finally -- he thought he could run this website full-time.

Loper quit his job.

That's when all hell broke loose.

Within days, Loper's website lost 80 percent of its search traffic and advertising revenue. Loper found himself both unemployed and without a viable business.

He spent several months correcting course, making his business solvent again. More importantly, he learned the importance of creating *multiple streams of income.*

Loper launched multiple small side businesses in order to diversify his income. Some succeeded; others quietly fizzled out. He made enough 'small bets' that he wound up with a handful of winners.

Today, his income comes from a cacophony of different sources. He's diversified.

Loper joins us on this week's episode to explain how to develop a "side hustle," a small micro-business that provides a supplemental source of income.  
 
Here are some of his suggestions:

#1: Tap the Sharing Economy

We've heard about Uber, Lyft, Airbnb, Instacart and TaskRabbit -- popular 'sharing economy' platforms that allow people to turn their car, home and/or time into extra cash.

But beyond those obvious examples, there are plenty of sharing-economy websites that niche down into higher-paying specializations, such as:

http://Turo.com -- A website in which you can rent your car; no driving required. You make money from the asset, not from your time.

http://EatWith.com -- A dinner-party-hosting website ideal for people who are skilled cooks, chefs, or party hosts, but don't necessarily have the capital to start their own restaurant.

"Each of these is a little mini-search-engine," Loper says.

2. Freelancing / Expertise-Based Businesses

The stronger your expertise, the more money you can potentially earn. After all, you're not just selling your time; you're selling your *knowledge.*

Websites that help people profit from their expertise include:

http://TheExpertInstitute.com -- A website where attorneys look for expert witnesses.

http://Thumbtack.com -- A website for service professionals, from CAD designers to nutritionists to CPR training.

http://Wyzant.com -- A website for expert tutors in every subject from calculus to piano.

http://Clarity.fm -- A website for on-demand coaching or consulting from experts.

3. E-Commerce

Loper outlines two models for selling physical products online:
    
- **The Retail Arbitrage Model:** Under this model, you find and flip items online.

- **The Private Label Model:** Under this model, you design, manufacture, package and import your own product.


Loper dives into details about all of these side hustle opportunities -- and also describes the biggest mistakes that he sees entrepreneurs and wantrapraneurs make -- in today's episode.

Enjoy!

________________


Resources Mentioned:

Side Hustle Nation http://www.sidehustlenation.com

200 Sharing Economy Platforms http://www.sidehustlenation.com/sharing-economy-make-extra-money

Steve Chou episode of the Afford Anything Podcast http://podcast.affordanything.com/make-100000-year-online-steve-chou-wife-quit-job

Jul 10, 2017
#084: Ask Paula: No, Really, I'm Asking for a Friend! -- How to Crush $500,000 in Debt
53:11

This week, I tackle your questions with my good friend, recovering financial planner Joe Saul-Sehy. Here's what we answer:

1. I'm asking for a friend -- no, really, I'm asking for a friend!

My friends are married and buried. They're a married couple, buried in $500,000 of debt.

Some is federal student loans, some is private student loans, and some is credit card debt. They're paying the minimum on their student loans, with the hope that these loans will be forgiven after 25 years. They're also saving money in their retirement accounts.

Is this a terrible plan? Should they stop saving for retirement while they wipe out their student loans? If so, how can I convince them?

2. My husband and I are both 30 and live in Ft. Collins, Colorado. We don't plan on having children.

We know that long-term care insurance gets more expensive as you age. Should we buy this insurance now? Or can we self-insure for this through adequate retirement/investment funds?

3. I own my home free-and-clear, and I'm buying a second home. Should I take a cash-out refinance on my primary home? Get a conventional loan from the bank? Or something else?

4. My wife, 4 children and I live in the San Francisco Bay Area. We have $5,000 in credit card debt, which we've paid down from $30,000 in the last two years. We owe $20,000 on a minivan and $18,000 on student loans, both of which have 2-3 percent interest rates. We have two IRA's, one Traditional and one Roth. I also have about $20,000 in my company's non-matching 401(k).

Should I focus my future investments on Traditional or Roth accounts? What accounts should I use when saving for my children's college funds?

5.  I'm curious about your own investments, Paula. What's under the hood?

__

Thank you to everyone who left a comment after last week's show. I'll talk more about these amazing responses at the end of Episode 85 (next week's episode.)

For now -- enjoy today's show!

Thanks!

Show notes can be found at http://affordanything.com/episode84

Jul 03, 2017
#083: This is The Toughest Episode I've Created So Far
38:25

Hey. It’s time we talked.

I’ve made many tough decisions in my business.

I’ve said “no” to thousands of pitches, turned away countless advertising requests, and made difficult choices about content and tone.

And sometimes I don’t know whether or not I’ve made the right choice.

Today’s podcast episode is a painfully personal one. I open up my mind, explaining exactly how I make decisions about how to lead this online community. I’m frank about the doubts I hold and the choices I’ve questioned in hindsight. I’m blunt about the things I still do not know; the ethical quandaries that plague me.

Today’s episode, perhaps more than any episode I’ve ever done, comes from my heart. I hope you enjoy it.

----------

Have thoughts/concerns/suggestions regarding what I discussed in this episode? Feel free to reach out on the site (http://affordanything.com/episode83), Twitter (@affordanything), Instagram (@paulapant), or YouTube (https://www.youtube.com/affordanything). 

Also, note to new listeners: I HIGHLY suggest you don't start with this episode! There's way more valuable content in the interviews and Ask Paula episodes that I've previously published. You can check those past episodes out on iTunes, or on the site: http://podcast.affordanything.com/listen

Thanks!

Jun 26, 2017
#082: Ask Paula - How Do You Pick a Rental Property?
39:01

Welcome to another Ask Paula episode!

This week, I answer three real estate questions:

#1: What criteria do you use when you’re shopping for an investment property? What qualities make you say, “heck yeah I’m buying this!!” — and what qualities make you say, “No way!”

#2: I enjoy renting my personal home, but I still dream of investing in rental properties. Does it make sense to buy a rental property, even while I’m still a renter myself?

#3: I’m a 45-year-old actress, and my income probably won’t qualify me for conventional bank financing for an investment property. But I already own a property with a lot of equity. Should I tap that in order to buy another rental? Or look for a private loan?

Enjoy!

 

For more Ask Paula episodes, visit http://podcast.affordanything.com/tag/ask-paula

Want your question answered? Leave a message here: http://www.affordanything.com/voicemail 

Jun 19, 2017
#081: Get Me Out of This Crappy Job! - with Jenny Blake, author of Pivot
48:45

Jenny Blake used to have an enviable job.

As a Career Development manager at Google, she enjoyed the perks of a Silicon Valley life, plus the satisfaction of helping people everyday. She co-founded Google's Career Guru Program, and helped countless Google employees find their right career "fit."

But, ironically, Blake sensed that her own career wasn't on the right track.

So she took a brave plunge that few would dare: Blake quit Google, packed her bags, and moved from California to New York in search of a new life. She launched her own business. She began publishing books.

Today, she joins us on this podcast to share the knowledge she's accumulated over many years about how *anyone* can pivot into a new career or direction.

If you're feeling stuck in your job, and you're thinking about making a major life change -- regardless of whether you'd like to try a new industry, retire early, or start your own business -- you might want to hear some of Blake's advice.

Enjoy!

http://podcast.affordanything.com/episode81

Jun 12, 2017
#080: Joe Says Life Insurance Won’t Make the Headline. But it Did.
47:58

Chris, age 30, makes $200,000 per year and saves 50 percent of his income. What accounts should he use in order to maximize his tax benefits?

Dee, age 39, is getting tired of apartment living. She found a great neighborhood in which she'd like to own a home, and she's saving for a 20 percent downpayment. But she's nervous about the high cost of home maintenance. How can she deal with this?

Chelsea just moved into a new house with her husband. He purchased the house outright, in cash, and she wants to pay him so that she can share in the home's ownership and equity. But she also has student loan and credit card debt. Should she make progress towards all three of these goals (build equity, pay off  student loans, pay off credit cards) at the same time? Or should she prioritize one -- and if so, which one?

Charlene is curious: what's so great about Vanguard? Why do Joe and I like the Vanguard Target Date funds so much, as compared to funds from another brokerage? (Note: neither of us have any financial relationship with Vanguard, other than being an ordinary, run-of-the-mill customer.)

Alma is looking for a term life insurance policy that'll protect her if she passes away outside of the United States. Where and how can she find this?

My friend Joe Saul-Sehy, a former financial planner and host of the award-winning Stacking Benjamins podcast, joins me today while we tackle these 5 questions ... and somehow, also we go on a tangent about Burger King. It's a whopper of an episode. :-)

Enjoy!

More Ask Paula episodes can be found at http://podcast.affordanything.com/tag/ask-paula

Jun 05, 2017
#079: How I Bootstrapped a $4 Million Company, with Laura Roeder
59:00

When Laura Roeder was 22, she quit her job to become a full-time freelancer.

She earned $30,000 in her first year as a freelancer; $60,000 in her second year.

Ten years later -- (Laura is now 32) -- her company earns $4 million in annual revenue.

(Can I repeat that? Did I bury the lede? *Laura went from making $30,000 per year to owning 100% of a company that earns $4 million per year.* And she did this within a decade. Oh, and she also had a baby.)

(Like, whoa.)

Laura is the founder and CEO of a software company called Edgar, which provides social media automation for entrepreneurs and small businesses.

In this interview, I ask Laura (sophisticated) questions such as "How the f**k did you make the leap from freelancer to multi-million-dollar company owner?"

Here are some of the insights that she shares:

#1: You have nothing to lose.

When Laura quit her job, she conquered her fears by reminding herself: "Hey, worst-case-scenario, I work an hourly retail job for awhile if I can't find any clients."

Sure, that might suck. But is the worst-case-scenario *so bad* that it's a deal-breaker?

When Laura realized that the worst-case-scenario was something that she could live with, she proceeded full-speed ahead.

#2: Cut the cord.

When Laura transitioned from freelancing to consulting (her intermediate step before starting Edgar), she knew that if she maintained her client base, she wouldn't be motivated to grow her consulting business.

So she cut the cord. She dropped all of her clients, including one extremely lucrative contract, in order to motivate herself.

#3: Look for what's next.

Laura's transition follows a sensible narrative arc: employee, freelancer, consultant, software company founder.

Each step led to the next opportunity. Freelancing turned into consulting, which turned into a kernel of an idea for a software  company.

She couldn't have predicted, at age 22, where she'd be in 10 years. She simply proceeded one step at a time.

____

Listen to Laura describe her story -- and share advice for people who want to start companies and/or work remotely -- in today's episode.

May 29, 2017
#078: Ask Paula (and Will) - How Technology is Changing the Future of Real Estate Investing
51:33

Imagine that you're looking for a rental property. It's a warm Saturday afternoon, and you decide to cruise through a few open houses in the area.

Your autonomously-driving electric vehicle pulls into the driveway. Your wifi-enabled contact lenses automatically register the property's details: square footage, year of construction, sales history, tax assessment, price-to-rent ratio, average neighborhood occupancy rates, and multiple cap rate estimates. As you walk through the property, your contact lenses display the digital history of every item -- the furnace, dishwasher, windows -- keeping you up-to-date with the full installation and service history of every home component.

Welcome to the future of real estate investing.

What's looming on the horizon? How will technology -- including augmented reality and 3D printing -- affect the way we analyze and purchase rental properties?

I chat about this topic, and more, in today's podcast episode.

This week, I feature another Ask Paula episode, answering questions that this community has submitted. This week's theme is real estate, and I've invited Will to join me as we tackle your questions about rental investing.

Enjoy!

For more resources, visit the website at http://affordanything.com/episode78

May 22, 2017
#077: What I've Learned from 9 Years of Nonstop Travel, with Geraldine DeRuiter, The Everywhereist
54:00

For show notes, visit http://affordanything.com/episode77

May 15, 2017
#076: Ask Paula - How to Handle an Inheritance, Should I Invest in Properties or Start a Business, and More.
01:00:05

This week, my buddy Joe Saul-Sehy joins me to answer another round of listener-submitted questions.

A listener from California asks:
My husband and I will be inheriting money, which we plan to invest in index funds. We believe that our inheritance will eventually make us financially independent. However, I feel guilt about the fact that this money is unearned. Do you have any thoughts on this?

Eric wants to know: Should he stick with a high-deductible health insurance plan if he's starting a family?
 
Hailey says:
I just graduated from college; I'm making $30,000 per year, but I only work 30 hours per week, so I have time to work on side projects. I'm working on two small businesses, and also interested in buying a rental property. Where should I focus my time and dollars?


Enjoy!



For links and information to the resources mentioned, like Glassdoor.com, Salary.com, and Paula's article: Should You Pay Cash for a Car? -- visit http://affordanything.com/episode76

May 08, 2017
#075: Jen Sincero says she used to be a "grouchy broke person"
56:16

In her early 40's, Jen lived in a converted garage, buried in credit card debt and scrounging for spare change. She was the type of person who'd join her friends at a restaurant for dinner , order nothing except tap water, and fill up on the complimentary bread basket. She used duct-tape to repair her shoes. Her "splurges" consisted of buying new windshield wipers.  

Despite her struggles, Jen believed that pursuing wealth was icky. She'd internalized negative social attitudes towards money, such as:

Money isn't important. People are.

Rich people are lucky / gross / shallow.

You can't make money doing [insert your-dream-here].

You have to attend a good college to make money.

Money is out of my reach.

It's lonely at the top.

Who has that kind of money?

He/she is only about the money.

Those negative attitudes, Jen says, were holding her back. So she created a more positive script -- such as "I'm good at making money," and "Money is a tool that helps me live my best life."

This attitude shift made all the difference.

In today's interview, Jen describes her journey from broke to badass, and she explains how everyone can become more of a maverick at making money.

Enjoy!

Resources mentioned in this episode can be found at http://affordanything.com/episode75

 

May 01, 2017
#074: Ask Paula - How to Repay $50k in Student Loans on a $31k Income, What's the Deal with Bonds, and Do I Really Need Insurance
01:06:31

Former financial planner and friend of the show, Joe Saul-Sehy from Stacking Benjamins, joins me to answer the following listener questions:

Kicking off today's episode, Nicky asks:

I'm young and healthy. My car is old and not-worth-much. And my personal property isn't exactly fancy-pants.

Do I *really* need health, auto and property insurance? Or can I drop these insurances and save the money?

_______

Next, Shelbi says:

I'm 26, recently earned a graduate school diploma, and I'm taking the first steps into my career.

I take home $2,600 in monthly income, and my cost-of-living is $1,900 per month.

I maintain a $5,500 emergency fund and invest 20% of my income into a Vanguard Target Date Retirement account, with a Roth tax setup. I'll get an employer match after I've spent another year on the job. My employer also contributes $100 per month into my H.S.A. account, which is the only money that I'm putting into that fund.

I hold $49,000 in student loans (yikes!!) at 6.8% interest. I pay $400/mo towards this debt, which is included in my $1,900 cost-of-living and is more than the minimum required.

My goal is financial independence and early retirement.

She asks these three questions:

-- Should she lower the 20% she's putting into her 403b in order to max out her Roth IRA and HSA, instead?

-- Should she prioritize repaying her student loan debt over retirement savings?

-- Should she schedule a private coaching call with me? (Surprisingly, I said no. Tune into the episode to find out why.)

_______

Next, Nicole asks:

What types of investments can you hold inside a self-directed IRA? If I open one of these accounts, what custodian should I use?

_______

Finally, our friend anonymous asks:

What's the deal with bond investing? What's a coupon payment? A maturity date? WTF? Can you help me make sense of the world of bonds and bond funds?

_______

Joe and I tackle these four questions ... plus reveal a top-secret recipe for the Best. Oreo. Cookie. Dessert. EVER.

Like, *ever.*

Enjoy!

-- Paula


_______



Resources Mentioned:


Interview with Andrew Hallam, the man who became a millionaire on a teacher's salary: Here's Part 1 and Part 2.


Want to hear your voice on an upcoming episode? Leave your question at http://affordanything.com/voicemail

 

Who are you? Please take this 7-question survey: http://affordanything.com/whoareyou

Apr 24, 2017
#073: What Chess Taught Me About Making Smarter Life Moves -- with Steve Gossett
01:07:56

Last January, I went to a party at a trailer park that featured a huge bonfire, a few llamas, and a member of Public Enemy.

(I realize that sounds like the setup to a joke. Welcome to my life.)

While I was there, I met a former competitive chess player named Steve Gossett. Steve is a Los Angeles-based filmmaker who creates Princess Rap Battle videos for a YouTube channel with more than 1 million subscribers.

But that's not why I invited Steve onto the show.

I asked him to join me on the podcast to discuss the lessons that chess taught him about money, work and life.

On this fascinating episode, Steve and I discuss:

 - Opening Theory: At the start of the game, you have a limited selection of moves. Yet you can quickly lose the game if you choose the wrong moves. Don't lose at the outset.

- Muddled Midgame: While the first few moves are (relatively) simple, even the experts don't quite understand the complexities of the mid-game.

- Gambit: Sometimes, you need to be willing to give up a piece on the board for the sake of getting another strategic win.

- Eliminate options: You'll fatigue yourself if you try to consider every move. Learn how to quickly eliminate options so that you can focus on choosing between a small handful of optimal moves.

- Think ahead: Don't just think about the consequences of the next move. Think many, many moves ahead on the board. Also, realize that every move carries an opportunity cost: once you move a piece on the board, it's not in that same position anymore -- for better or for worse.

- Study/practice/knowledge can reduce time pressure: Chess is a timed game with a ticking clock. You can make smarter, faster decisions through study and practice. Knowledge is your competitive advantage.


I hope you find this conversation as fascinating as I did. Enjoy!

 - Paula

Links to the Princess Rap Battle and Whitney Avalon's YouTube channel can be found in the show notes at http://affordanything.com/episode73

 

Apr 17, 2017
#072: Ask Paula -- Should I Loan Money to Friends? Stay Sane While Repaying Debt? ... and More
49:00

Spaghetti is a major part of my life.

I eat it, of course, as many people do. I also spill it all over my pants, despite the fact that I’m 33 and should’ve learned the rules of gravity by now.

But most importantly, I use spaghetti as a metaphor for my business. If I’m not sure if something will work or not, but I want to experiment with an idea, I tell myself that I’m just “throwing spaghetti at the wall.” Maybe it’ll stick; maybe it won’t. Either way, I have permission to try, permission to fail, and permission to get pasta stains all over my drywall.

This week, I’m starting a new spaghetti-throwing-experiment on the podcast: I’m going to broadcast “Ask Paula” episodes every-other-week, followed by interviews with guests every-other-week. This allows me to handle the awesome volume of questions that are flowing in (which I LOVE), while still enjoying intriguing conversations with fascinating people.

This every-other-week thing is just an experiment; I’d love to hear what you think. Do you want more “Ask Paula” episodes? Or should I return that segment back to its original once-a-month placement? Or am I overthinking this and I should really just get on with the show notes for this week’s episode?

Assuming you’re like, “Option C, Paula — get on with the show notes!,” here they are.

___________

 
Our first question comes from David, who asks: Could you ever find yourself in a situation in which you could justify helping a friend by paying off their credit card, and in exchange, they pay you a modest but respectable interest rate?

Here’s his situation:

His friend holds $6,000 in credit card debt, with carries an interest rate ranging between 11 to 17 percent. This friend also holds $30,000 in student loans. Yikes!

David, however, is debt-free, maxes out his retirement accounts, and holds cash savings of $56,000. He’s thinking of loaning his friend around $3,000 of this money, which she could use to pay off the 17 percent loan. In exchange, David would get a decent-but-not-outrageous return, perhaps in the neighborhood of 7 percent-ish.

Should he do this? If so, how? Should he sit down with a lawyer?


Next, Amy asks:
We’re carrying debt, although fortunately it's low-interest. We're paying it off, and we're doing the best we can; this debt will be gone in a few years. How do you stay patient and calm, when progress is happening at a snail's pace?

Later, Alexa says:
I’ve realized that I haven’t followed my true passions, which are travel and dance. I’d like to save money for a few years, and then pursue these twin goals. What should I do with the money that I’m saving for travel? Should I keep it liquid or in stocks? Should I put it in a taxable account or a retirement account?

Lyra asks:
I have 5 goals: repay debt, save an emergency fund, help my son pay for college, save for retirement, and buy a rental property. How do I split my money between these five goals?

Next, Kim asks:
What are the pro's and con's of portfolio lending for an investment property? I keep getting hung up on the "balloon payment," in which you need to repay the full loan after a particular period of time. How would you qualify for a refinance, given that you need a portfolio loan in the first place?


Finally, Daan wants to know:
I’m a Dutch citizen who moves to a different country every 2-3 years. Is real estate a viable option for me?

Apr 10, 2017
#071: Can I Retire Yet? - with Roger Whitney, the Retirement Answerman
01:01:01

Roger Whitney is known as the "retirement answer man."

"All I think about, all day long, is how to make that [retirement] transition successfully," he says.

But he holds a dirty little secret.

"I don't believe in retirement. And the most successful clients that I work with ... technically they're retired, but they're still working."

Huh?

What does that mean?

In today's episode, Whitney and I discuss the nuances of 21st-century modern retirement -- and how this ain't nothin' like the traditional retirement that you've been taught to expect.

Enjoy!

______

For the "WTF?" -- Vocabulary guide from this episode - visit http://affordanything.com/episode71

 

Apr 03, 2017
#070: Erin Lowry on Raising Children Who Are Enabled, Not Entitled
01:01:31
Erin Lowry, author of Broke Millennial, talks about the early childhood scripts that we learn about money.

Why is this topic important? Well, if you're a parent, you want to set a good financial example for your child to follow. Giving them the right tools and information about money at an early age, as Erin's parents did, can easily set them on the right path in life.

And as 'grown-ups,' many of us have negative scripts around money that we want to unearth and unlearn.

Regardless of your specific situation, one thing is true: we often inherit our money mindset from our parents. For better or worse, we unconsciously internalize their actions and thoughts around money, and it shapes how we view and interact with money today.

Erin shares the lessons her parents taught her about money in this episode, and discusses the impact it's had on her spending and saving. (Hint: She's always been debt-free and has set the awesome goal of being a millionaire by age 35.)

For example, Erin is a natural saver and became frugal at a very young age thanks to her parents being savers.
While that sounds great, she often prioritized earning money to the detriment of her social life. She shares a specific instance where she passed up what turned out to be a night to remember among friends for a babysitting gig that paid $100. These days, she allows for more balance in her budget.

We also discuss:
  • Specific financial lessons Erin's parents taught her and her sister at an early age
  • Erin's first memories surrounding money, and how those shaped the person she is today
  • Erin's thoughts on financial independence and retiring early
  • How our views on real estate investing differ because of the lens with which we view it
  • Erin's decision to become a freelancer just six months ago
  • A personal example of when being frugal crosses the line
and more!

Enjoy!

Find more resources at http://affordanything.com/episode70

 
Mar 27, 2017
#069: Ask Paula - The Real Estate Edition
01:05:41

So many Afford Anything listeners have great questions about real estate investing. That's why this episode of Ask Paula is dedicated to answering them.

Our first question comes from Ade, who has $25,000 to invest in real estate and lives in the Bay Area. Understandably, he's thinking of investing out-of-state, and wants to know if Atlanta is still a good city to invest in. Where can the best deals be found?

Krystina lives and has four rentals in Vermont, but she's sick of the cold. She's thinking of selling the properties and moving elsewhere. She asks: if you had to start over, where would you buy and what type of property would you buy?

The next question comes from Kayla, who wants to know how to report rental income on your taxes when you also live in the property. Are there any tax implications to be aware of?

Claire is relocating to California, and is curious to know if she's better off renting, or if she should max out her mortgage loan potential and buy a house that has a detached garage she can rent out to cover the increased mortgage.

Our next question comes from a listener with a paid-off rental who also has an Airbnb on her property. Nice! But, she has a $160,000 mortgage on her own house. She has $30,000 in the bank and wants to know: should she put it toward her mortgage, or use it to buy another property?

Our last question comes from Katie, who's eyeing a vacation rental in one of her favorite destinations. Does it sound like a good idea? And how can she estimate the cap rate (and her expenses) without a ton of information on the property?

We dive into these topics - and more - in today's episode. Enjoy!

To be included in Paula's Real Estate Course, click on the link in the show notes at http://affordanything.com/episode69

 

Mar 20, 2017
#068: Ask Paula - How to Invest Your Tax Refund, Save for College, and Avoid Massive Pitfalls
01:06:01

My buddy Joe Saul-Sehy, host of the Stacking Benjamins podcast, joins me this week for another episode of "Ask Paula (and Joe!)" -- in which we workshop through questions that came from you, the Afford Anything community.

This week, Joe and I answer questions such as:

- I'm getting a $2,500 tax refund. Should I use this to invest, repay debt, or upgrade my home?
- I'm debt-free (except a reasonable mortgage) and maxing out my retirement accounts. What else should I be doing?
- I've started savings accounts for my two daughters, ages 3 and 6, so that they can access this money for big-ticket expenses when they're young adults. How should I invest this money?
- I'm interested in socially responsible investing. What specific funds should I look at?
- What's your opinion of high-dividend ETFs?
- What's your opinion of using whole life insurance as a 'creative' wealth-building strategy?

Enjoy!

-- Paula

P.S. If you'd like to ask a question for a future episode, leave a voicemail here.

Mar 13, 2017
#067: Ask Paula -- How to Care for Aging Parents, Buy a Car, and Organize a Business
45:36

It's the first Monday of the month, which means it's time to answer questions from the Afford Anything community.

Our first question comes from a caller in a tough spot: Her mother-in-law is 66 years old. She's divorced, holds no retirement savings, and will only receive a tiny Social Security check. Her health is worsening, and she'll need to step away from work shortly. The caller wants to help her mother-in-law ... but how?

Our second question comes from Erin, a listener who's moving to California and needs to buy a car. She's new to the world of car-buying, and wants to know how she can get a great deal. What red flags should she watch out for?

Our third question comes from Hong, a 32-year-old mother of two who's interested in early retirement. She's thinking about saving money in a 401k until she maximizes her employer match, then switching to a Traditional IRA, and then switching back to saving in her 401k. Should she pursue this strategy? How can she maximize her tax advantages?

Our fourth question comes from John, who wants to know what I've learned from building an online course. He's contemplating creating one of his own.

Finally, I answer a question from Adalia, who wants to know if my online business and real estate business are structured as part of the same company, or operated as two separate entities. She asks if I can talk about how I made my business structuring decisions.

Have a question? Record it from your smartphone or computer. Go to http://affordanything.com/voicemail and leave a short message.

Mar 06, 2017
#066: Take Radical Responsibility for Your Life -- a Breakfast Chat with 26-Year-Old Millionaire Emma Pattee
46:15

You know that rare moment when you meet someone with whom you connect *instantly*?

I felt that way when I met Emma Pattee, the 26-year-old millionaire and mini-real-estate-mogul who joins me on today's episode.

Emma and I share similar stories: we're both young female artists and entrepreneurs who figured out that wealth is a tool for creating the freedom that allows us to live on our own terms.

We both hustled harder than words can describe, living and breathing our commitment to breaking free from the trading-time-for-money cycle. We refused to accept the defaults that were handed to us. We viewed our investments as a way to create a more sustainable, meaningful life.

We rejected the limiting belief that a creative, meaningful life is somehow more 'pure' when it's lived in scarcity and deprivation. We embraced abundance. We asked "how can I create this?" We viewed every problem as inherently solve-able. We took responsibility for everything that crossed our paths.

Most critically, we decided that we weren't going to let any excuses hold us back.

We accepted radical responsibility for our own lives. We wouldn't allow ourselves to get trapped in a victim mindset, a comparison ("they-have-it-easier!") mindset, or an external-factors-are-holding-me-back mindset.

I rarely meet people who have committed to the inner work of internalizing these lessons. Emma is one of those rare people.

And that's why I'm excited to share our breakfast conversation with you.

I hope you enjoy this episode. And to paraphrase Seth Godin, more importantly, I hope this episode spurs you to take action.

Lots of love,
Paula

 

Feb 27, 2017
#065: How to Improve Your Relationship with Money
42:01

I've always taken an approach to life that puts my freedom first.  My one and only 9-5 lasted only 3 years. Since then I've been self employed and built financial independence through rental real estate.

And while most see this podcast as being about money, it's really about a philosophy around life that is disguised as a finance blog and podcast.

Today I get real about this whole money thing. I hope you follow along the mental journey with me.

Feb 20, 2017
#064: Michael Kitces -- Your Mind is More Powerful Than Money
01:17:18

Your potential is unlimited.

I realize that's the type of cliche that you normally find embossed in cursive script on the side of coffee mugs. It's trite and impersonal and overused.

But it's also true.

Your potential to earn and grow is limitless. But it's not free. You need to invest time and money into developing your potential.

Your time and money are limited, though, and you could also choose to invest in market-based assets, like stocks, bonds or real estate.

How do you make that decision?

Are you going to invest in yourself? Or the market? Or both -- and in what proportion?

How do you make these choices?

When you're buying a few shares of a total stock market index fund, you have a generally clear idea of what you're getting. You've seen the historic returns. You can predict, to a reasonable degree, the consequences of that investment over a multi-decade span.

But when you're investing in yourself -- e.g. learning a new skill, developing a side business, or taking a class -- you can't rely on the same formulas or models. There's no chart mapping the historic returns.

Financial capital is easy to track. Human capital is harder to quantify -- but potentially more rewarding.

Can you compare investing in assets vs. investing in yourself?

How can you make a smarter decision about your own path?

On today's podcast, I talk to Michael Kitces -- a financial planner, entrepreneur, and all-around smart guy -- about this million-dollar decision.

Find more helpful information at http://affordanything.com/episode64

 

Feb 13, 2017
#063: Ask Paula - Travel vs. Passive Income, Proximity in Real Estate Investing and Selling Off Properties
37:46

It's the first Monday of the month, and you know what that means - another Ask Paula episode.

Our first question comes from Richard, who wants to know if he should focus on creating a travel fund or building passive income through real estate.

What did I do, and how did I manage to come back from my world travels and start building a real estate portfolio only a few years later?

The next question comes from Andrew. He's contemplating purchasing two houses on the cul-de-sac he lives on and then renting them out. He only plans on living in his current house for another five years, at which time he also wants to rent it out. Is he crazy? Would proximity give him an advantage?

Jennifer asks the next question. She and her husband owe $150,000 on a rental property in Portland, OR that's worth $350,000. Should they sell the house and buy more properties? What would I do with the equity in the property?

 

Find more resources and Ask Paula episodes at http://podcast.affordanything.com/tag/ask-paula

 

Feb 06, 2017
#062: Ask Paula - Q&A Featuring Special Guest Joe Saul-Sehy from Stacking Benjamins
01:18:09

Joe Saul-Sehy, a former financial advisor and host of the Stacking Benjamins podcast, joins me to answer your questions in this bonus episode of Ask Paula.

Joe and I are goofballs; we tell PG-13 dirty jokes; we disagree on several answers, and we have a grand 'ol time. Hopefully you'll learn something, and you'll probably end up laughing along the way.

For a full list of questions and more about today’s episode, visit http://affordanything.com/episode62

Enjoy!

Jan 30, 2017
#061: John Lee Dumas - From Small-Town Kid to Multimillionaire Entrepreneur
48:47

Even though John wasn't never an entrepreneur at heart -- even though he didn't (yet) self-identify as an entrepreneur -- he decided to throw himself, full-force, into the one and only business idea he'd ever had.

Listen to John's story, in his own words, as he describes his journey from a small-town college kid to a successful 7-figure business owner.

For resources mentioned in this episode, go to http://affordanything.com/episode61

Jan 23, 2017
#060: Andrew Hallam (Part Two): The Nine Rules of Wealth You Should Have Learned in School
01:40:12

Andrew Hallam grew a million-dollar investment portfolio on a schoolteacher's salary by his mid-30's.


In his bestselling book, Millionaire Teacher, he describes these nine lessons in detail.


He shares these nine rules on this podcast, and his ideas are so substantive that -- for the first time -- I decided to release his interview as a two-part series.


In last week's episode, Andrew shared the first three rules of building wealth. This week, Andrew dives into the final six rules that can turn middle-class people into millionaires.


Here's a sneak peek:


    •    #1: Learn how to think and spend like a millionaire.
    •    #2: Start investing early. Time is your greatest investment ally.
    •    #3: Choose low-cost index funds. Small fees pack big punches.
    •    #4: Understand your inner psychology. Conquer the enemy in the mirror.
    •    #5: Learn how to build a balanced, responsible portfolio.
    •    #6: Create an indexed account, no matter where you live.
    •    #7: Don't resign yourself to taking this journey alone.
    •    #8: Inoculate yourself against slick sales rhetoric.
    •    #9: If it sounds too good to be true, it probably is.


These rules may sound simple, but our discussion took an advanced turn. Andrew and I dive deep into thorny topics like hedge funds, casinos, and human psychology.


Enjoy this two-part series, and don't forget to check out Andrew's excellent book, Millionaire Teacher.

Jan 16, 2017
#059: Andrew Hallam: How I Became a Millionaire on a Teacher's Salary
01:02:20

By his mid-30's, Andrew Hallam became a millionaire on a teacher's salary. He began by investing $100 a month upon advice given by a mechanic. Then he began saving nearly half his $28,000 teacher’s salary.

Andrew rode a bicycle 35 miles to work, found ways to avoid paying rent, and regularly ate pasta and potatoes as well as clams he picked himself for added protein.

In today's interview, Andrew shares that story.

Find more comprehensive details at http://affordanything.com/episode59

Jan 09, 2017
#058: Ask Paula -- Death, Taxes, Crushing Debt and Moving in with Mom
47:33

Ashley is a single mom saving diligently for her 2-year-old son. What alternatives are there to 529s and brokerage accounts?

Julie and her husband invest quarterly. Should she try buying European equities when they are much cheaper due to Brexit?

Nicholas and his wife make too much money for a Roth IRA. Should hey do a backdoor Roth?

Melissa has money to save, invest, or pay down rentals. What’s her best option?

 

Find more in the show notes at http://affordanything.com/episode58

Jan 02, 2017
#057: Philip Taylor - Top 5 Financial Lessons PT Learned in the Past Decade
52:01

Philip Taylor, aka PT, is one of the most well-connected guys in the personal finance world. He’s spent the past half-dozen years building tight relationships with some of the most influential authors and speakers in this space. Today he shares his top five money lessons learned over the past decade.

PT shared several tactical tips, including:

    •    Buy term life insurance, rather than whole life.
    •    Focus on low-cost investing, such as passively-managed index funds.
    •    Automate your savings.
    •    Focus on income growth.
    •    View frugality as a discipline. It’s not a means to an end; it’s a lifestyle and a core value.

For a full explanation of PT’s 5 takeaways, visit http://affordanything.com/episode57

Dec 26, 2016
#056: Billy Murphy - Expected Value, or What Professional Poker Taught Me About Running a 7-Figure Business
55:23
Former professional Poker player Billy Murphy has an intriguing story.

He achieved financial independence at age 29, and he did this by applying a concept known as "expected value" to his online businesses.

In this episode, I chat with Billy about how expected value is more than just a formula; it’s a framework for how to evaluate your options; how to assess risk, reward, probability, and variance.

Let's back up a little. What is expected value? It’s the sum of all possible values for a variable, with each value multiplied by its probability of occurrence.

“Whaaaa? What does that mean?”

Here’s a simple example:
 
Imagine that you have a full-time job. You’ve also built a side business that’s earning $20,000 per year.

You’re trying to decide whether to stay in your full-time job vs. quit your job and focus on growing your side hustle into a full-time business.

You ask your two best friends for their opinion. One says, “that’s risky! What if you fail?” The other says, “you could become a millionaire! Whoa!”

You realize that both of those remarks are fueled by emotion and speculation. You want to make a more informed decision, so you decide to compare the ‘expected value’ (EV) of both options in Year One.

After assessing the market (e.g. studying customer demand, etc.) you determine that in your first year of running the business full-time, under best-case-scenario conditions, you could earn $250,000. There’s a lot of promise within your field; you calculate a one in four chance of this happening.

In worst-case-scenario conditions, you don’t make a dime of additional money; your business stagnates at its current income. There’s a lot of competition within your field; you assess that there’s also a one in four chance of this situation unfolding.

In middle-case-scenario conditions, you’d make around $100,000 per year. This is the most likely outcome, and you give it 50% odds.

What’s the expected value of diving full-time into this business?

EV of biz =

25% chance of earning $250k = $62,500
50% chance of earning $100k = $50,000
25% chance of earning $20k = $5,000

EV = $117,500

Okay, great. Next, what’s the expected value of staying at your current job?

EV of job = Salary + $20,000 in additional income

Of course, this is an over-simplified example, for the sake of illustration. Obviously, the decision gets more complex, because you need to account for future growth of your business — the 5-year outlook, the 10-year outlook — as well as future career growth potential within your 9-to-5 job. You’d also need to assess revenues vs. profit margins, etc., etc.

But this simple example illustrates the concept of using the expected value formula to inform your decision-making. Rather than just saying, “oh, that’s risky!” without any data, you can use EV as a starting point for a conversation about probability and risk.
The point is, when you're making a decision, your emotions and other people's opinions often override any rational thought you might have. Those emotions don't take risk or variance into consideration. Expected value does.

By running the numbers and identifying the worst-, mid-, and best-case scenarios, you can take calculated risks that have a higher likelihood of paying off.

Find out how Billy built a seven-figure business by applying this one incredible rule to his decision making process in this episode.

Enjoy!

-- Paula


Resources Mentioned:

 

Find more about Billy Murphy and his podcast, Forever Jobless, in the show notes at http://affordanything.com/session56

Dec 19, 2016
#055: From Money Moron to Millionaire, with Scott Alan Turner
53:00

Scott Alan Turner used to be a money moron. (In his words.)

He traded a Jeep for a Porsche in his 20s, purchased a 3,000 sq. ft. house with two mortgages, and bought luxury furniture on credit.

The Porsche cost him $800 per month. The house cost $200,000. The furniture? Who knows.

Scott didn't have a budget and never tracked his spending. He only knew that he could afford the monthly payments on these luxuries ... until one day he realized his mortgage was due in a few weeks.

And his bank account was rather empty.

And he didn't have an emergency fund.

Oops.

Scott realized he was drowning in debt. So he decided to make a change.

He sold the Porsche and paid $6,500 cash for a truck.

He paid off his credit card.

He aggressively attacked the mortgage on his house.

Step-by-step, he made strides toward improving his financial future. After listening to Clark Howard on the radio, he realized it was important to free his money from the grip of debt and put it toward savings and retirement.
Once he got married, he sold his house and downsized to his wife's town home. They then downsized to a 1,000 sq. ft. rented house, and downsized once more to a 300 sq. ft. bedroom with his in-laws.

Throughout all of this downsizing, Scott kept saving money. He eventually saved enough to become a millionaire at age 35. Today he writes and speaks about personal finance full-time. He hosts the Financial Rock Star podcast. And he's stayed debt-free -- including mortgage-free -- since 2009.

How did he go from money moron - buying expensive cars and furniture - to disciplined saver?

He can answer that question in one word:
Contentment.

He doesn't need to buy more, because he's happy with what he already has.

Scott credits his frugality to feeling satisfied with his possessions, rather than running on a hedonistic treadmill of always wanting more.

While he still appreciates fine craftsmanship -- a gorgeous house, a designer car -- he realizes that he doesn't need to own luxury items. He can appreciate art and design without making a purchase. He prioritizes spending on his values: more time with friends and family; more life experiences. He doesn't spend to impress others, which is a losing game.

Discover Scott's fascinating philosophy on the link between frugality and contentment (and learn from his money mistakes!) in this episode.

Enjoy!

-- Paula

For a full list of resources, or to leave a comment, visit http://affordanything.com/episode55

Dec 12, 2016
#054: Ask Paula - Automating Savings, Starting a Blog, Emergency Funds, Investing in Real Estate Confidently, and More
38:08

It's the first Monday of the month, which means I'm fielding questions from the audience.

We start with a question from Nicole.

She's a new listener, and she's stuck in a confusing situation.

You see, Nicole is self-employed. She'd like to save a percentage of her income -- but she doesn't get regular paychecks. How can she automate her savings, when she doesn't know how much she'll make each month?

She asks a second question, as well.

Nicole has $15,000 in savings and wants to buy her first rental property. However, she's intimidated by the unknown market. What should her first steps be?

Next, we move to a question from podcast listener David. Should he invest his emergency fund?

David is contemplating putting his emergency savings in the Vanguard Immediate-Term Investment Grade Fund (VFICX). Is this a good idea?

Saul, another podcast listener interested in real estate investing, recently sold his home and has a decent chunk of change. Should he buy a 3 bed / 2 bath townhome with a small commercial space on the first floor? Or should he buy a duplex?

Podcast listener Albert is wondering: should he buy a home for himself, and rent it out a few years later? He'd like to travel and work remotely. What are the downsides to this idea? It can't be that easy ... right?

Finally, Abbey started a personal finance blog, and wants to know:

    When should she start promoting her blog?
    How much content should she write?
    Does she have to share her blog with her friends and family, or can she stay anonymous?
    Should she write about other things besides money and travel?

I tackle these questions in this month's edition of Ask Paula.

Enjoy!

-- Paula

P.S.  Trying to make a decision? Ask your question at http://affordanything.com/voicemail

Resources Mentioned:

    Renting is Throwing Money Away...Right?
    Everything I Know About Blogging Condensed Into One Post
    Should You Invest in This Rental Property?

_______________________

To view this information online, visit http://affordanything.com/episode54

Dec 05, 2016
#053: Live Q&A with Paula on Real Estate and Travel
01:00:36

This episode is a little different.

Instead of interviewing a guest, this podcast episode is a recording of a recent talk I gave in Equador.

The audience wanted to know more about the context surrounding the decisions I've made regarding business, investing, and money.

In other words, why I've only spent three years of my life in a 9-5 job, and why I've dedicated so much of my time to travel.

There is a lot of real estate talk as I take Q&A from the audience, but the idea behind releasing this talk is for you to see how any investment can help you design your life around your values.

Money and investments are just tools that you can use to craft a certain lifestyle.

Here are some of the highlights from the talk:
•    How I was introduced to the concept of freelancing, and how it helped me quit my job and buy real estate
•    My real estate investing strategy in a nutshell - buy what no one else wants to buy
•    The risk of being too excessive with renovations as an investor, and how I've managed renovations
•    How I use the One Percent Rule when running numbers on a property
•    My original goal for owning rental properties (and why I don't want 100's of units)
•    The surprise deal that came about because of my blog
•    The opportunity cost of investing in real estate instead of the stock market
•    Why the next rental won't be in Vegas (where I live)
•    Why I'm not in any hurry to buy another property
•    Why I would buy apartment complexes in cash if I had a billion dollars
•    The benefit of diversifying into a different city and how to do it
•    Retailers I recommend buying from when it comes to kitchen materials
•    Financing without W2 income
•    Why I'm against high-leverage
•    The other projects I'm working on (why my focus isn't on real estate investing right now)
•    "Pearls of wisdom" from traveling
•    My favorite travel destinations
•    Why I started a blog and my thoughts on monetizing
•    Real estate isn't a passion - it's a tool

Enjoy!

-- Paula

Resources Mentioned:
•    Cash Flow Reports for Rental Properties
•    The course I'm working on - VIP List
•    HUD Home Store
__________________________

I also want to take a moment to thank the sponsors for this episode.

First, huge thanks to Nerdwallet. Their new app lets you have one-on-one conversations with financial advisors. You can chat about anything related to money, such as retirement, investing, insurance, or paying off debt.

You'll get personalized, one-on-one advice -- available at no cost to you. Check it out at no cost to you by visiting http://nerd.me/paula
_________________________

If you've been listening for a while, you've heard me interview many best-selling authors. Before I interview these guests, I need to read or refresh my memory of their books.

Sitting down to physically read the books can take a long time. That's why I listen to their audiobooks, thanks to my subscription to an audiobook service called Audible. If you want to give them a try for free, head to http://audible.com/trynow for a free 30-day trial.

_________________________

To see the slides from Paula's presentation, go to http://affordanything.com/53

Nov 28, 2016
#052: How to Combat Lifestyle Inflation, with Julia Kelly
36:17

Imagine transitioning from making $8.50 per hour and sharing a crammed apartment with 5 people, to becoming a six-figure business owner doing what you love.
 
That's the journey that Julia Kelly, caricature artist and founder of JK Expressions, took.
 
Sounds great, right?
 
Well, as they say, more money = more problems.
 
When Julia earned $25,000 - $30,000 per year, she had fantastic money management skills. She had no debt and plenty of savings.
 
But when her business started making six figures, she began ignoring her finances, stopped saving money .... and racked up thousands in personal credit card debt.
 
Why?
 
Some of us write this off as life getting more expensive as we get older, but it's actually a classic case of lifestyle inflation -- when you make more, you spend more.
 
After Julia began earning six figures, she decided she was no longer happy with $12 haircuts from Supercuts. She happily splurged for $75 salon style cuts instead.
 
She started paying for convenience. One-click Amazon order? Check. Ordering an Uber or Lyft so she didn't have to deal with parking at the airport? Check. Eating out? Check.
 
She became lazy about saving money, assuming that she could always earn more. Money was coming into her bank accounts at an unprecedented pace – so her finances would take care of themselves, right?
 
Wrong.
 
As Julia discovered, when you "upgrade" certain aspects of your life, you may find it difficult to downgrade. You keep spending more and more, trapped on a consumer treadmill. You’re forced to work to fuel your spending addiction.
 
Left unchecked, this saps every ounce of freedom from your life. 
 
Ouch.
 
In this episode, you'll learn:
· Why you shouldn't take lifestyle inflation lightly
· How to stop lifestyle inflation before it happens
· What Julia regrets buying … and what she doesn’t
· The easiest, most effective antidote to lifestyle inflation
· How Julia differentiates between saving time vs. wasteful convenience spending
· What Julia's advice is to those who are increasing their income, but don't want to succumb to lifestyle inflation

-- Paula
 
Resources Mentioned:
    •    Gretchen Rubin's episode, The Power of Habit Formation
    •    Julia's story on the Afford Anything blog

    •    Cal Newport's episode, The Incredible Value of Deep Work, Instead of Distraction
    •    Julia's site, JKExpressions.com

__________________________
I also want to take a moment to thank the sponsors for this episode.
First, huge thanks to Nerdwallet. Their new app lets you have one-on-one conversations with financial advisors. You can chat about anything related to money, such as retirement, investing, insurance, or paying off debt.
You'll get personalized, one-on-one advice -- available at no cost to you. Check it out at no cost to you by visiting nerd.me/paula.
_________________________


If you've been listening for a while, you've heard me interview many best-selling authors. Before I interview these guests, I need to read or refresh my memory of their books.


Sitting down to physically read the books can take a long time. That's why I listen to their audiobooks, thanks to my subscription to an audiobook service called Audible. If you want to give them a try for free, head to audible.com/trynow for a free 30-day trial.

_________________________

For a full list of show notes, visit http://podcast.affordanything.com/52-how-to-combat-lifestyle-inflation-with-julia-kelly

Nov 21, 2016
#051: Six Types of Financial Frenemies, with Mary Beth Storjohann
47:01

Today's guest is Mary Beth Storjohann, CFP®, Founder of Workable Wealth, and author of the book Work Your Wealth.


As I was reading through her book, one thing stuck out to me: the financial frenemies we all have, and how to deal with them in a constructive way.



What's a financial frenemy? They're the people in your life that are sabotaging your efforts to improve your net worth.

Sometimes they're friends, sometimes they're family, and other times, they might just be people that have no business asking about your financial situation in the first place. 



Whoever they are, we've all known one at some point or another.



In fact, I bet one of these sounds familiar:

1. The Entitled Frenemy: "Can you spot me? I'll get you next time!"
2. The Budget-Buster: "You deserve it, you should buy it!"
3. The One-Upper: "You got a $1,000 bonus? Nice. I got a $10,000 bonus."
4. The Priers: "How much do you make?" "How much did you spend on that?"
5. The Green-Eyed Monster: "Must be nice that you can afford such a big house."
6. The FOMO Frenemy: "You can spend your money just this once!"

Navigating conversations with these financial frenemies can be tough, but Mary Beth has some awesome advice on how to do it and not feel bad about your words.

Even though it might sound scary, honesty is the best policy.



While saying, "I don't feel comfortable answering that" means enduring a few moments of awkwardness, the alternative is answering truthfully and proceeding to wonder if your "friends" are judging you...every single time you interact with them.



Finally, we need to realize that what they're saying isn't a reflection on us - it's a reflection on them. If they're jealous, feel the need to one-up you, or discourage you from your financial goals, that's on them, not you.

Mary Beth offers other great tips on how to deal with financial frenemies in this episode, and we even role-played a scenario to give you a script to follow.

Resources Mentioned:


• Workable Wealth

• “Work Your Wealth" on Amazon
• Mary Beth's Twitter & Instagram


Enjoy!

-- Paula

Nov 14, 2016
#050: Ask Paula - Retirement Savings in Your 50's, Starting a Side Hustle, Buying Health Insurance, Home Warranties, and More
46:10


Mark, a 55-year-old listener, has no savings. He's been listening to personal finance podcasts. He recently read Tony Robbins' Money: Master the Game. He called this podcast to tell us that he's feeling overwhelmed by the scope of what's ahead of him. Mark doesn't know how to apply this information -- and he's afraid of needing to work in fast food when he's 80 years old. What can he do?

We tackle his question first on today's Ask Paula episode.

Next, we take a call from Adalia.

Adalia, another podcast listener, wants to earn extra money on the side. She's intrigued by the idea of becoming a virtual assistant -- a side hustle that allows her to work from home, setting her own hours. How should she start? Where can she find clients?

Tyler, a podcast listener and fellow FinConner, is carrying $20,000 in credit card debt, with interest rates ranging from 11% - 23%. He also runs a side business on Amazon, making  43-50% returns for every dollar he puts in. Should he focus on reinvesting money back into his lucrative business, or should he pay his credit card debt off?

Podcast listener Carlos just purchased his first rental property, and wants to know: are home warranties are worth the money?

Todd, another listener, is curious to know if he and his wife should go without health insurance as the cost of premiums increase. He has an HSA, emergency fund, makes a good living, is in good health, and saves everything he can. Could going without insurance really save him money?

Our last question comes from listener Lynsey, who has her sights set on financial independence. She works a second job during the cold Minnesota winters, which pays $25/hr. However, she wonders if she should use that time to invest in her future earning potential, by starting a business or getting an advanced degree. Should she go after the immediate cash, or focus on her future?

All of these questions are answered in this episode of Ask Paula!

Enjoy!

-- Paula
_____________________

I also want to take a moment to thank the sponsors for this episode.

First, huge thanks to Nerdwallet. Their new app lets you have one-on-one conversations with financial advisors. You can chat about anything related to money, such as retirement, investing, insurance, or paying off debt.

You'll get personalized, one-on-one advice -- available at no cost to you. Check it out at no cost to you by visiting nerd.me/paula.

_____________________

If you've been listening for a while, you've heard me interview many best-selling authors. Before I interview these guests, I need to read or refresh my memory of their books.

Sitting down to physically read the books can take a long time. That's why I listen to their audiobooks, thanks to my subscription to an audiobook service called Audible. If you want to give them a try for free, head to audible.com/trynow for a free 30-day trial.

_____________________

Want more "Ask Paula" episodes? Head on over the the website and binge all you want: Show Notes and other Ask Paula episodes

Nov 07, 2016
#049: Behind-the-Scenes Mastermind Call - with J.D. Roth
01:05:07

If you're a longtime listener, you might remember J.D. Roth, founder of Get Rich Slowly and owner of Money Boss, from Episode 20.

In this previous interview, J.D. shared how he went from being in debt to financially independent.

Today, he's back for a special edition of the podcast.

J.D. and I didn't actually record an interview for this episode. Instead, we hit "record" on one of our private mini-mastermind conversations, where we talk candidly about our businesses.

By listening to this episode, you'll get a behind-the-scenes look at what's going on in the Afford Anything and Money Boss world - without any filters.

Oct 31, 2016
#048: How to Overcome Procrastination and Perfectionism, with Stephen Guise
22:19

Imagine that your goal is to build a flat stomach and stronger biceps. But deep down, subconsciously, you’re afraid you might fail.

So you procrastinate. “I’ll work out tomorrow,” you tell yourself. “Or next week. Or next year.” As a result, you don’t make progress.

But let’s flip the script. Instead of focusing on the result — your appearance — you focus on the smallest possible action.

You create a new goal: Everyday, you’ll do a single push-up. You’ve designed a goal that cannot fail. The moment you commit to this goal, you drop to the ground and do a push-up. Congratulations. You’ve succeeded today. You repeat this everyday for a week. You build a new habit and new sense of self-identity. You’re the type of person who does daily push-ups.

One day, while executing your single push-up, you figure, “Ah, what the heck,” and pump out a few more. One push-up grows into five, ten, fifteen, twenty. You focus on tiny actions, rather than their potential long-term payoff.

Eventually, you get results. In today's episode, Stephen Guise, author of Mini-Habits, describes how the "one push-up" mentality accelerated his progress faster than a "100-pushup" mentality ever could.

He explains why he decided to start focusing on actions, he shares the technique that he uses to conquer writer's block, and he talks about embracing "imperfectionism."

Enjoy!

Oct 24, 2016
#047: How to Stop Being Your Own Worst Enemy, with Clark Howard
51:11

Today's guest is New York Times bestseller, radio and television personality, Clark Howard.


While Clark is known as a personal finance expert, that title doesn't tell the whole story.


He started reading stock tables when he was in fifth grade.
He began investing in real estate at the age of 22.
He created his own travel agency business at the age of 25.
And he became financially independent and retired at age 31.


However, after four years of living on the beach, he was ready to get back to work. He wanted to help people take control of their money and, consequently, their lives.


Clark believes that money is the result of the discipline you bring into your life. Unfortunately, most people want to take the path of least resistance when it comes to achieving their goals. That's why so many people fail.


Clark says that the most common mistake he sees his listeners make is getting in their own way. People give up before they've started and play the victim.


That's not the path to success - financial or otherwise.


So, how can you stop standing in the way of your own success?


In this episode, we cover that, as well as:
    •    Clark's journey to financial independence
    •    Why he chose to pursue this audacious goal
    •    Why he felt ready to jump back into work after enjoying four years of retirement
    •    Why we behave the way we do when it comes to achieving goals
    •    What money means, and why it matters
    •    How to control your reaction to the inevitable setbacks we experience in life
    •    Why everyone must live beneath their means and spend less than they earn to achieve any financial goal
    •    What the future of money holds


There were so many takeaways in this episode, I couldn't list them all. Clark is brilliant and offers some amazing insights into the financial industry, as well as business lessons he's learned throughout his years of being an entrepreneur and managing teams.


Enjoy!


Resources Mentioned:
Clark.com
Podcast

Radio

Oct 17, 2016
#046: The Unbelievable Power of Building a Community - Live at FinCon
27:01

This episode is a little unusual because I interviewed fellow podcast listeners live at FinCon (a conference for financial bloggers).

Why? To get to know you and understand you better.

I want to know what makes you tick, and where your interest in money comes from.

Ultimately, why you're here, listening to this podcast, when most people couldn't care less about these topics.

Why are you different?

To discover that answer, here are some of the questions I asked our panelists:

• Why did you decide to make learning about personal finance your hobby? Why do you spend hours reading blogs and listening to podcasts about money?
• What made you approach personal finance head-on, rather than burying your head in the sand, like most people do?
• Do people in your "regular" life know that you want to retire early and reach financial independence? Or do you avoid talking about this because people give you funny looks when you mention it?
• Have you all had the same experience that community - finding like-minded individuals - is important in this journey?

I hope you were able to learn and identify with your fellow listeners about why you manage your limited resources in such a conscientious way.

The chief takeaway I got from this episode was the importance of building a community, which is critical to maintaining motivation on the journey to reach financial independence.

Not only that, but you're the average of the five people you spend the most time with. Seek out a support system of people with similar values and goals to have your back when times get tough.
 
Resources Mentioned: 

• Nick: True Tightwad
• Melissa, "The Roamer": Traveling Wallet
• Emma: Emma Lincoln
• Gwen: Fiery Millennials
• The One Percent Challenge Facebook Group
• Everything I Know About Blogging, Condensed into One Post
• Financial Independence Subreddit
• Meetup.com

-- Paula

Oct 10, 2016
#045: Ask Paula - Should I Invest $5,500 in One Huge Chunk? - and More Investing Questions
34:46

Podcast listener Eva is interested in opening a Vanguard account. She noticed that people need $50,000 to access their personal advisor services. It'll take her several years before she can access this. What should she do in the meantime? Amy, another podcast listener, wants to invest $5,500 into her Roth IRA in 2017.  Should she invest the full amount on January 1, or should she spread this throughout the year? Meanwhile, podcast listener Daniel asks: • Q1: I'd like to invest in real estate. Where and how should I look for homes, other than Zillow? • Q2: Why would an investor sell a cash-flowing, profitable investment property? Should I be suspicious about multiunit properties for sale? Eric, another podcast listener interested in real estate, asks: • Q1: What are the basic steps for forming an LLC, especially one with multiple partners who aren't equal investors? • Q2: How do you go about creating a joint bank account for the LLC? Is it even needed? Should the account be referenced in the LLC documentation? I answer all of these questions in this episode of Ask Paula. Resources Mentioned: • Mike Piper's Blog: Oblivious Investor
 • Michael Kitces' Blog: Kitces.com (Nerd's Eye View)
 • I Don't Know How to Start Investing, and I'm Afraid of Making Expensive Mistakes (Blog Post) • Why Dollar Cost Averaging Stinks (Blog Post) • The Simple Path to Wealth by Jim Collins • Mike Piper's Books on Investing
 • #24: Ask us Anything: Betterment, Wealthfront, Robo-Investing...What's the Deal? (Podcast) • #31: The Simple Path to Wealth, with Jim Collins (Podcast Interview) Enjoy!

Oct 03, 2016
#044: "Why I Quit My Dream Job" – with entrepreneur Leslie Samuel
52:23

When Leslie Samuel immigrated to the U.S. at age 17, he hoped for the American Dream: an education, a secure job, and a traditional career path.

But during his college years, Leslie realized he had an entrepreneurial streak. He made a few attempts at working for himself.

He failed.

He lost money that he'd set aside for his wedding. He tried investing in the stock market. He lost more money, savings that he'd set aside to pay his tuition.

But he didn't quit.

Leslie graduated, married, and accepted a job as a high school science teacher.

He felt happy and secure. Yet his entrepreneurial itch persisted. He started building an online business in his spare time. 

Leslie began earning an extra $14,000 per year on the side, a nice supplement to his income. A few years later, Leslie landed his dream job as a university professor. He loved his work. He earned a solid income.

His wife gave birth to a healthy baby boy. Everything seemed perfect. But his entrepreneurial calling persisted.

Ultimately, Leslie made the difficult decision to quit his dream job in order to become a full-time online entrepreneur.

In this episode, he shares why he made this tough choice – and how he handled the fear and doubts that blocked the way.

Sep 28, 2016
#043: Jean Chatzky Shares Money Rules for Modern Life
33:01

Today's guest is Jean Chatzky, financial editor for the TODAY Show, host of the HerMoney podcast and a frequent guest on TV shows like Oprah, Regis & Kelly, and The View.

She's the bestselling author of many books, including Money Rules, which we discuss in today's episode. Here are a few of the Money Rules we cover:

#1: The more time you spend looking, the less happy you’ll be with what you find. #2: Your retirement trumps their tuition.
#3: Losing money hurts more than it should.
#4: Big numbers make smart people do stupid things.
#5: Don’t lend money to friends & relatives, and don’t co-sign for loans.
#6: If its 50% off, it's still 50% on.

__

It’s not about having it all. It’s about having what you value most. How can you match your money with your values? Jean and I tackle this question in the second half of the podcast. This leads us into discussing tactics that can prevent wasteful spending, such as:

• The 10/10/10 Rule – How will you feel about this purchase in 10 minutes? 10 months? 10 years?
• The 24 Hour Rule – Delay the purchase by 24 hours. Do you still want it?
• Only Pay Full Price – Paradoxically, avoiding sales – and ONLY buying items at full price – might help you save more money in the long run.

__

Finally, we chat about how to balance financial priorities when you and your spouse want different things. What if you want to retire early, but your spouse doesn't? How do you handle this?

Jean shares her ideas on all these topics in today's episode.

Sep 19, 2016
#042: The Incredible Value of Deep Work, Instead of Distraction – with Cal Newport
01:07:08

Your most valuable asset isn't your house, car or retirement portfolio. It's your attention. Most knowledge workers spend their day franticly hopping between meetings, emails, phone calls and social media. But that's not the best way to stand out in the modern economy. Emails are necessary, says author and professor Cal Newport. They'll keep you from getting fired. But they won't get you promoted. Instead, focus on deep work, Newport says. Dedicate your mental energy towards cognitively-demanding tasks that stretch the limits of your capabilities. Develop your skills as a writer, investor, programmer, mathematician, musician, artist, or whatever field you practice. You'll achieve bigger success from honing rare, valuable skills than you would from sending a few additional tweets or replying to emails at a faster pace, he says. You'll also enjoy more meaningful work. Deep work isn't something that you cram into the margins of your life. To the contrary, focusing on deep work allows you to boost your productivity at work and feel more fully present at home. Newport discusses the concept of Deep Work, and shares tips on how to apply this to our lives, in today's podcast.

Sep 12, 2016
#041: Ask Paula: Investing, Rebalancing and Renovating
31:34

Mollie, a listener, is making smart money moves.

She's getting the maximum match on 403b contributions. She's saving for a downpayment on a home. Her husband opened a Roth IRA.

What's next?

After listening to the Jim Collins episode, Mollie wants to open a Vanguard account. How can she balance this with the rest of her saving and investing goals? Is she spreading herself too thin?

Meanwhile, podcast listener Elizabeth is trying a little-known tactic to rebalance her portfolio.

Traditional advice tells people to rebalance by selling their gains. But Elizabeth wants to let those gains ride. She'd prefer to rebalance by buying undervalued assets.

Are their hidden dangers to her strategy?

Finally, podcast listener Chris wants to remodel his basement. He's an aspiring Airbnb host who'd like to make extra cash by renting out part of his home. How much money should he spend on his basement remodel? Are there any good rules-of-thumb?

I tackle these three questions in today's Ask Paula episode.

Sep 05, 2016
#040: The Power of Habit Formation, with Gretchen Rubin
01:11:02

Most of us want to develop better habits. We want to exercise more, eat healthier, get more sleep, watch TV less, pay off debt, or save money.

The problem?

We make excuses.

We tell ourselves we'll splurge "just this one time."

We convince ourselves that we're too busy to start a side business. We reward ourselves with a hall pass from our intended new habit.

Today's guest, Gretchen Rubin, talks about how we can create habits that stick. Gretchen Rubin is the New York Times bestselling author of The Happiness Project, which sold more than a million copies.

Her latest book, Better Than Before, explores how to create habits that lead to a healthier, happier, richer life.

Aug 29, 2016
#039: The Seven Stages of Financial Independence, with Joshua Sheats
01:25:16

It's tempting to think of "financial independence" as a finish line. You've either crossed the finish line, or you're still running the race. But financial independence is more nuanced, says today's guest, Joshua Sheats.

We experience seven stages of financial independence, Joshua says, and we should break down our Major Goal -- financial independence -- into a series of smaller steps.

Joshua, a financial planner and host of the hit podcast Radical Personal Finance, describes these seven stages in today's show, offering tips about how to reach each one.

Want a sneak peek at the seven stages? Check out http://podcast.affordanything.com

Aug 22, 2016
#038: Why You're Not As Busy As You Think, with Laura Vanderkam
38:31
There are 168 hours in a week.
 
If you work 40 hours per week and sleep 8 hours per night, you’ve accounted for 96 hours. You have an additional 72 waking hours per week.
 
What are you doing with this time?
 
That’s the question today’s guest, Laura Vanderkam, tried to answer by analyzing more than 1,000 time logs kept by full-time professional workers. Our collective narrative says that Americans are overworked, sleep-deprived and don’t have enough time for family or personal lives. That’s our emotional truth. But statistics paint a different picture. When more than 1,000 professionals track their time in 15-minute increments over the course of a 168-hour week, the data doesn’t point to time deprivation. 
 
In today’s episode, Laura describes this surprising fact: we have more time than we think.
 
She also shares tactics on how to reduce chores and errands, stay focused and productive at work, and recognize the difference between efficacy and diminishing returns.
Aug 15, 2016
#037: Chris Guillebeau -- How to Live a Remarkable Life in a Conventional World
35:01

Chris writes about life, work and travel. He has visited every country in the world and written a number of New York Times best selling books.

He joins us to talk about challenging ourselves, experimentation,and deliberately changing our direction.

 

For more information, visit http://podcast.affordanything.com

Aug 08, 2016
#036: Ask Paula -- Should I Buy a Turnkey Rental Property? -- and More Real Estate Investing Question
25:46

It's the first Monday of the month, and you know what that means ...

Time for another Ask Paula episode! On today's show, I answer a handful of phone calls from listeners who posed questions about real estate investing.

One caller from Atlanta said that he's thinking about buying a rental property from a turnkey investing company. (These are companies that buy, renovate and rent out properties, and then sell those properties to investors.) On the surface, this sounds appealing: all benefit and no work. But what are the drawbacks? Are those risks worth it? Should this listener buy a turnkey property? Or should he stay wary of red flags?

Another caller, who says he loves real estate investing, mentioned that he's curious about the lack of compound interest in the real estate game. If you're investing in an index fund, he noted, your dividends and gains are automatically reinvested. That's not the case with a rental property. Sure, you can reinvest the cash flow from that property into buying more properties (or buying other investments, like index funds), but that's not the same thing. So ... what does this mean? When you take compound interest into consideration, are rental properties still a good deal? Or are real estate investors missing out on this crucial wealth-building tool?

Another wanted to hear more details about a couple whom I mentioned in Episode 4, The Ultimate Beginner Guide to Real Estate Investing. This couple's strategy is to buy a home as a primary residence, live there for at least one year, move out, convert their former home into a rental property, and repeat. They've done this over and over, and now they're raking in the rental cash. The listener wanted more details about that strategy ... which I offered in droves. (And yes, I led myself into another little rant.)

Finally, one listener called to share his success story. In an earlier episode, he asked whether he should repay his credit card debt, or save for the downpayment on a house. I told him to pay off his credit cards ... and he's now DEBT-FREE!!!!!! He tells his success story on today's show.

Enjoy!

Paula

Aug 01, 2016
#035: How to Start Freelancing on the Side, with Carrie Smith from Careful Cents
36:16

Carrie Smith enjoyed her full-time accounting job, but she wanted to make extra money on the side. Who doesn't, right?

She landed a second job in a tax office, working 9-to-5 for one employer and 5-to-9 for the other.

She earned decent money, but her schedule had no flexibility ... and she felt unhappy. 

This needs to change, she realized. I need to make good money while also enjoying my lifestyle.

Even though she had zero experience as a writer, she wondered if she could leverage her skills as an accountant into a new, creative field. She volunteered to write one or two tax planning articles for a client, just to test the waters. She enjoyed the work. She wanted more. 

She started reaching out to websites and companies that might need tax-related article writing. She landed her first major client, Yahoo Finance. Then another. Then another. 

After a few years, her freelance business grew large enough that she quit her comfortable accounting job. She's her own boss now. 

In this episode, Carrie tells her story and offers advice for anyone who wants to earn extra money as a freelancer -- whether its a side hustle or a path towards quitting your 9-to-5 day job.

 

For more, visit http://podcast.affordanything.com

Jul 25, 2016
#034: How I Built a Six-Figure Online Store -- with Steve Chou from My Wife Quit Her Job
42:46

Steve Chou's wife used to work grueling hours at a job she dreaded and despised. When she became pregnant with their first child, she decided to quit. 

The problem? She earned six figures, and their family needed that income. 

She opened an online store, buying handkerchiefs wholesale from China and retailing these online at a significant markup. She and Steve worked together to build a retail website and find customers. They bought Google Ads; they wrote blog posts; they created seller accounts on various shopping portals.  

They earned more than $100,000 in their first year of business.

In this episode, Steve explains how he and his wife earn six figures as online retailers while enjoying a much more relaxed, liberated lifestyle.

He offers pointers for anyone who's interested in making money selling goods online -- either as a side business or as a method for quitting your day job.

 

For more, visit http://podcast.affordanything.com

Jul 18, 2016
#033: How I Became a Millionaire on a Military Salary - with Doug Nordman
37:38
After serving in the Navy for 20 years, Doug Nordman, then-age 41, retired from his military career. Most of his peers started second careers in the civilian world. 
 
But Doug didn't. He had an ace up his sleeve: he had spent his military career saving 40 percent of his income. By the time he turned 41, he held an investment portfolio worth $1 million. Those investments, coupled with a Naval pension for $30,000 per year, propelled him into financial independence.
 
He's remained retired since leaving the Navy. He's now 55. He surfs three times a week. He travels to Europe on a whim. His retirement portfolio survived two recessions and is now worth $1.7 million.  
 
In this interview, Doug shares the story of how he became a millionaire on a military salary. He also talks about the fulfillment he's found through financial independence.
 
Enjoy!
Jul 11, 2016
#032: Ask Paula: The Market Might Drop. Should I Sell?
41:16

Should you sell your stocks, given that we might be heading for a possible downturn? Also, what are the downsides of index funds? Should you invest in out-of-state rental properties, and if so, how can you figure out where to look? These are just a few of the many questions Paula answers in this week's Q&A episode. Enjoy.

For more information, visit http://podcast.affordanything.com

Jul 04, 2016
#031: The Simple Path to Wealth, with Jim Collins
34:45

Jim Collins, also known as popular blogger JLCollins, has been financially independent since 1989. He achieved this in the simplest way possible: he saved half of his income and invested in index funds.

Jim says the simplest possible approach is the best, if your goal is to build financial freedom. "The great irony of investing is the simpler of an approach you use, the more powerful of results you get."

In this episode, he shares his ultra-simple approach to investing. He says that when you prioritize simplicity, above all else, you can ignore your investments and move on with your life:

"Most people don't want to think about this stuff all the time. Most people want to get on with curing diseases and building bridges and writing peace treaties. But the smart ones know they have to have some kind of handle on their money."

Check out Jim's ultra-simple path to wealth in this week's episode.

http://podcast.affordanything.com

Jun 27, 2016
#030: Okay, I’m Financially Independent. Now What? -- with Jim Wang
01:26:01

When Jim Wang was 29-and-a-half, life changed forever.

Jim started an online company (a blog) in his mid-20's.

His website grew to several hundred thousand readers and started earning five-figure monthly sums.

It sounds too good to be true. I know. But it's Jim's life.

He experienced the heady, surreal boom; that crazy era when a business grows beyond wildest expectation. He experienced the fear and worry that the good days might not last. And he experienced the reality of trading his website for a life-changing seven-figure sum.

And then what?

What happens when you're 29-and-a-half, and you suddenly discover that you're financially independent? What's next?

Where do you go from there? What becomes important? And what lessons, what universal truths, can this reveal about our own lives?

What can we learn from the aftermath of financial independence -- regardless of our current bank balance?

Jim and I have a frank, forthright and insightful conversation on today's show. It's a long episode, but a good one.

To receive updates via email or more information about the show, visit http://TheMoneyShow.co

Jun 20, 2016
#029: Ask Paula: Pay Debt vs Buy a Home? Invest in Index Funds vs Creative Alternative?
38:31

Call in your questions to the Money Show Hotline http://themoneyshow.co/voicemail

Paula answers questions you sent in about multi-level marketing, paying off credit card debt vs buying a house, and socially responsible investing.

You can find other Ask Us Anything episodes at http://themoneyshow.co/tag/ask-us-anything

Jun 13, 2016
#028: How I Woke Up, Removed the Blindfold, and Noticed My Money for the First Time -- with Evelyn Connors
43:16

Most people only pay attention if there's a problem - that includes money.

Guest, Evelyn Connors gets honest and raw about her previous understanding of how money works and her uber-excitement of taking control of her FI (financial independence).

Share this with your friends: http://TheMoneyShow.co/evface

Jun 06, 2016
#027: Pete the Planner, Comedian-Turned-Money-Columnist, on Millionaires and Mock Retirements
39:31

Pete the Planner talks about why millionaire-dom is important and why it's important to try a "mock retirement".

To contact the show or send in your questions for a future episode, visit http://TheMoneyShow.co/contact

May 30, 2016
#026: Last Show With Jay
01:13:45

Sometimes you need to let go of the good for the great. Jay Money has started a lot of projects, only to let them go because they didn't match his goals.

The show must go on - and it will with Paula at the wheel. Jay will be back from time to time (and in every episode, as you will notice in future episodes).

Confused? Visit http://TheMoneyShow.co/episodes for more.

May 23, 2016
#025: The Stacking Benjamins Roundtable Plays a Game of 'Would You Rather'
40:46

Would you rather...have $15k in quarters or $15k in dollar bills? Today we have fun with Joe Saul-Sehy, Len Penzo and Greg McFarlane (HELLO Greg) from the Stacking Benjamins Roundtable.

For more serious episodes about M.O.N.E.Y., visit the archives at http://TheMoneyShow.co/episodes

May 16, 2016
#024: Ask Us Anything #4 - Betterment, Wealthfront, Robo-Investing -- What's the Deal?
01:02:45

You ask. We answer. Let's grab a beer.

This is the first Ask Us Anything in which we hear YOUR voices -- which makes this episode extra-awesome. 

In this week's episode, Paula and J. Money tackle listener-submitted questions, such as:

Investing:

  • What's the deal with these robo-advisors? Should I plunk my money into their accounts?
  • Betterment, Wealthfront ... what's the deal with these companies? Who can keep track?
  • Index funds vs. rental properties -- what's better for scoring tax breaks?

Entrepreneurship:

  • I'd like to hire a virtual assistant. How do I start? What should I look for?

Grab Bag:

  • Don't forget about Canada! What are the best blogs and podcasts for money-savvy Canadians?

Find out the answer to these questions and more in today's episode.

Note: We received so many real estate questions that we'll devote another AUA episode exclusively to that topic.  Today's episode (mostly) covers other arenas.

Enjoy!

Visit http://TheMoneyShow.co for more great episodes

May 09, 2016
#023: Farnoosh Torabi, Host of CNBC's Follow the Leader, Spills the Secrets of Successful CEOs
49:16

Farnoosh Torabi is host of CNBC's Follow the Leader. She shares stories about spending 48 hours with the most influential business leaders in the nation.

For a list of notes and resources, visit http://TheMoneyShow.co/Episode23

May 02, 2016
#022: How Jeremy and Winnie Retired in Their 30's
57:46

Jeremy and Winnie are the bloggers behind Go Curry Cracker. They took a vacation to the Philippines and decided this was where they wanted to live - and retire there early (like REALLY early).

For more information visit http://TheMoneyShow.co

Apr 25, 2016
#021: Making Money as a Voice Over Actor with Carrie Olsen
52:01

Carrie Olsen started podcasting with her husband, then dipped her toe into the voice-over industry and is KILLING IT!

For more great M.O.N.E.Y. episodes, visit http://TheMoneyShow.co/episodes

Apr 18, 2016
#020: From Debt to Financial Independence, with Get Rich Slowly Founder JD Roth
58:16

The Money Boss, JD Roth, went from $35k in credit card debt to selling a personal finance blog for an undisclosed amount of money. Today he shares how financial independence affected him - and how having enough money to be financially independent forces us to face our problems.

For more visit http://TheMoneyShow.co

Apr 11, 2016
#019: Football and Hip-Hop's Financial Advisor Rob Wilson Talks About Managing Celebrity Money
54:01

Financial Advisor to the stars, Rob Wilson, gives us the inside scoop on what kind of help celebrities and sports heroes need. What he tells us may surprise you!

For more M.O.N.E.Y. goodness check out our other episodes at http://TheMoneyShow.co

Apr 04, 2016
#018: Ask Us Anything #3 - Real Estate Investing Edition
57:00

Listener questions are back by popular demand! Paula answers your questions about real estate investing niches, strategies, and things to stay away from.

For more M.O.N.E.Y. goodness, visit http://TheMoneyShow.co/18

Mar 29, 2016
#017: Making Money as an Uber and Lyft Driver, with The RideShare Guy Harry Campbell
01:04:30

Harry began driving for Uber 2 years. Now he's making 6-figures sharing tips for how to maximize time and profit with Uber, Lyft, DoorDash and PostMates.

For Harry's rideshare money-making tips, visit http://themoneyshow.co/harrycampbell

Mar 21, 2016
#016: How Aaron Epstein Went from Side Hustler to Selling a Multi-Million Dollar Company
01:10:01

Aaron Epstein shares his story of shoveling snow as a kid to launching a profitable website during college to selling a multi-million dollar company.

For more visit http://TheMoneyShow.co/16

Mar 14, 2016
#015: Ask Us Anything #2 - Dollar Cost Averaging, Pay off Debt or Invest
56:31

Q&A #2 with Paula, the analytical one, and J. Money, the heart of your M.O.N.E.Y. Team 

Follow along with the answers: http://themoneyshow.co/15

Mar 07, 2016
#014: So You Want to Be a Blogger?
01:00:16

Can you make money as a blogger? How? We share the good and bad reasons for choosing to go into blogging.

Send us your questions or comments http://TheMoneyShow.co/14

Feb 29, 2016
#013: How to Destroy Your Stupid Debt, with Steve Stewart (and the Controversy Around Dave Ramsey!)
01:08:01

Steve and his wife got on the Dave Ramsey plan and they paid off their house! Plus, Steve's little coaching trick of Rent vs Buy vs Invest.

Get more at http://TheMoneyShow.co/13

Feb 22, 2016
#012: Ask Us Anything #1 - Student Loan Help, Tax Hacks, Time Management Tips and REITs
01:08:01

It's time to pick the brains of Paula and J. Money with our first ever "ASK US ANYTHING" episode. 

Follow along with the answers: http://affordanything.com/episode12

Feb 15, 2016
#011: Making $100k from eBay and Airbnb with Jay & Ryanne
54:31

Jay and Ryanne have created a beautiful life for themselves scavenging for resale items in rural areas and renting houses in the Shenandoah National Park area of VA.

Read more at http://TheMoneyShow.co/11

 

Feb 12, 2016
#010: From Millionaire to Broke, Plus the Habits of the Rich, with Tom Corley
57:30

OMG! It's Tom Corley, the RICH HABITS guy!

Jay is having a heart attack. Tom Corley studied self-made millionaires and poor people to come up with some interesting results. He wrote about it in a story called "Rich Habits".

Tom shares his story of being well off as a child before his dad lost everything. Then he worked hard to bring himself up to not-broke status and on to becoming an accountant.

After studying some of his clients he expanded to 233 self-made millionaires and 150 poor people. The results of those studies were very telling - but nobody really cared about it.

Then he got a break when Farnoosh Torabi did a segment about the Rich Habits on Yahoo Finance. The rest is history in the making.

Watch for Tom Corley's new book - Change Your Habits, Change Your Life - which gives more of the "how to" rich habit change. You can find it at http://ChangeYourHabitsBook.com

For links to some of Jay's favorite Tom Corley articles, visit http://TheMoneyShow.co/10

Feb 10, 2016
#009: Tools We Use to Kick Ass and Grow Wealth
01:10:30

Checking, savings, investment accounts, car insurance, credit cards, even umbrella insurance - it's all covered in this episode.

These are the financial tools Jay Money and Paula Pant use.

For a complete list of resources, visit http://TheMoneyShow.co/09

Feb 08, 2016
#008: How Jay Became a Half-a-Millionaire -- and Why He Wants You to Track Your Net Worth
50:41

J. Money is a HALF-MILLY! He loves to share his journey to growing net worth on his blog, as well as the net worth of 180 other financial bloggers.

See the short list and find links to resources by visiting the blog at http://TheMoneyShow.co/08

Feb 05, 2016
#007: The Mad Fientist Reveals the Science of Financial Independence
59:31

One of the M.O.N.E.Y. Show's favorite personal finance bloggers joins Paula and J. Money to talk about retiring early and hacking your HSA.

For full show notes with links to resources, visit http://TheMoneyShow.co/07

Feb 03, 2016
#006: How to Transition from Hustler to Entrepreneur
59:01

J. Money says a hustle is "a way to make money on the side, but more of a passion project or something that is fun. You do it for more than just money.”

Paula says it’s a “microbusiness".

No matter how you slice it, a hustle is a way to make extra money doing activities outside of a normal J.O.B.

Paula and J. Money share their stories of working on hustles to become the entrepreneurs they are today.

Visit http://TheMoneyShow.co/06 for more information about hustles

Jan 28, 2016
#005: How Kids Affect Your Hustle (and it's Okay!)
01:00:16

Paula wants to know how J. Money’s life has changed as a hustler since having kids.

For a while, J worked less and made less money.

"It was a conscious decision to not make as much money for a while. I was more than happy making less because I was working on stuff I cared about.

I also had a fear of being a work-a-holic and picking my hustle over my kids. Having kids forced me to have a work/life balance."


Leave comments, contact us, or find links to more of our stuff at http://themoneyshow.co/05

Jan 28, 2016
#004: Ultimate Beginner Guide to Real Estate Investing
01:00:30

In this episode, Paula shares a confession. Then she redeems herself by sharing her gross monthly income.

(Yeah. Listen from the beginning).

Full show notes at http://TheMoneyShow.co/04

There are a variety of ways to invest in real estate:

  • Flipping houses
  • Buy-and-hold
  • Tax liens
  • Wholesale
  • Income-producing rental properties (commercial and residential)


Paula loves residential rental properties.

Ask yourself: Do you want capital appreciation or cash flow from rental income?

Paula puts a few guidelines in place to determine if a property is right for her.

First of all, the monthly rent needs to be at least 1% of the total acquisition price.

Example: A $100,000 home would need to rent for $1,000 a month. Why? Because roughly half of the rent is gobbled up by operating overhead:

Taxes, Insurance, property management, and repairs/maintenance

Paula offers much more valuable information in this episode and on her blog, AffordAnything.com.

 

Jan 28, 2016
#003: Habits We Rock to Kick Ass and Grow Wealth
01:07:16

Paula and J. Money share the financial habits they use to grow wealth.

Full show notes can be found at http://themoneyshow.co/03

Listen as they share their favorites (and a couple neat tricks):

  • Track Net Worth
  • Maximize retirement savings accounts
  • Pay bills at least 1 month in advance
  • Set up bills on auto-pay
  • Leave a buffer in your checking account
  • Round up debt payments
  • Double the principle payments of your mortgage

Enjoying the show? Please leave a comment or write a short review for the show in iTunes: http://themoneyshow.co/itunes

Jan 28, 2016
#002: Don’t Feel Guilty - Buy a Coke Zero and Pay Someone to Mow Your Lawn
54:01

Once again, Paula and J. Money see things differently.

J. Money preaches budgeting, Paula practices the “anti-budget”.

J. Money examines every expense to find savings. A couple years ago he switched phone providers and saves $100 a month, $20 a month on insurance and $60 on cable.

Paula recommends saving at least 20 percent of your income first, then go wild with the rest; “Don’t feel guilty about spending money on Coke Zero or turtle food”

Who is right?

To leave a comment or contact the hosts, visit http://TheMoneyShow.co/02

Jan 28, 2016
#001: The Story of M.O.N.E.Y. -- Having Heart and Hustle
42:31

Becoming successful in finances takes more than M.O.N.E.Y. - it takes heart and hustle.

Meet Paula Pant and J. Money. Both worked day jobs before becoming successful bloggers.

They share their stories about buying a house before the market tanked, starting their side-hustles, and acheiving "mini-retirement", at least for Paula.

We value your input. Please visit http://TheMoneyShow.co/01 to leave a comment.

If you like what you hear, please subscribe for free in iTunes http://TheMoneyShow.co/iTunes.

Jan 28, 2016