[luke2220]

Hey everyone,
I know this is off topic but I started a youtube channel with one of my buddies who is a certified financial planner and it is all about sharing free financial tips and information to help the general public lead more financially successful lives. I know this is the BEST forum going and I would love to have your support on my youtube channel so please check out my new channel and subscribe if you like the content we are providing you

Here is our newest video!


Thanks in advance!!

[Tajefe Couple]

Just curious if your buddy is also a fiduciary?

[luke2220]

Originally Posted by Tajefe Couple

Just curious if your buddy is also a fiduciary?

Im not sure exactly, i can ask... he owns his own company and is a certified financial planner but id have to ask if hes a fiduciary.

[pyroguy]

Mostly sound financial advice. I agree with the three points, but I will argue that #2 is a little skewed. While paying off the largest interest makes the most mathematical sense, many people get burned out quickly if their largest interest load is also their largest balance loan. By listing the debts smallest to largest, regardless of interest, paying the minimum on everything but the smallest and attacking that one with a vengeance you get to get some "quick wins" which give people a sense of accomplishment. When you see you're making progress you're more likely to stick with it. If you do a budget (which I would add as a 4th item on your list) and squeeze everything out of it that you can to put on paying down the debt the math works out to maybe a month or two extra between the way I suggested vs your way. The difference is people are more likely to stick to a plan if they see progress.

Overall good advice and it's neat to hear your take. I agree with a vast majority of what you said. Emergency fund, mandatory. Pay off debt, absolutely (no debt is good debt IMO). Invest for the long term, one day you'll want to quit working. I know I do. Thanks for the share.

[luke2220]

Originally Posted by pyroguy

Mostly sound financial advice. I agree with the three points, but I will argue that #2 is a little skewed. While paying off the largest interest makes the most mathematical sense, many people get burned out quickly if their largest interest load is also their largest balance loan. By listing the debts smallest to largest, regardless of interest, paying the minimum on everything but the smallest and attacking that one with a vengeance you get to get some "quick wins" which give people a sense of accomplishment. When you see you're making progress you're more likely to stick with it. If you do a budget (which I would add as a 4th item on your list) and squeeze everything out of it that you can to put on paying down the debt the math works out to maybe a month or two extra between the way I suggested vs your way. The difference is people are more likely to stick to a plan if they see progress.

Overall good advice and it's neat to hear your take. I agree with a vast majority of what you said. Emergency fund, mandatory. Pay off debt, absolutely (no debt is good debt IMO). Invest for the long term, one day you'll want to quit working. I know I do. Thanks for the share.

Thanks for the opinion! Definitley good to hear different takes of what different people like to do, like my buddy said from our first video that this is all based off of his opinions and what hes seen work best for his clients. If you watch our first video “ one of the biggest financial mistakes” he talks about an alternative to budgeting which is a good watch if youre interested.

[pyroguy]

It is a good video to watch, but I would strongly disagree that you don't need to budget. He eludes to not writing checks for bills and then wondering where the money went at the end of the month and that you should not live beyond your means and those two items I agree with. However, if you sit down, put together a live-able budget and assign ever dollar that you will earn that month a name (mortgage/rent, food, utilities, transportation, etc.) you will find that you have some surprises in your spending. My financial adviser says that it takes 90 days to get a budget right, and in my experience he was about right. It took around 90 days to figure out where we were spending and ways that we could make our money work for our live-able situation. Part of the "pay yourself first" is knowing where to put the money so that it makes the best financial sense for you. If you have debt, that should be your #1 priority to eliminate. If you need to save for a large expense coming up (newer car, home repairs, college, etc.) then set aside a sinking fund. A sinking fund is nothing more than a savings account or allocation of money for a larger purchase. Either way, make sure that you're doing what's best long term financial sense. The greatest wealth building tool is your income. Don't let debt and frivolous spending take away your ability to retire wealthy.

[luke2220]

Originally Posted by pyroguy

It is a good video to watch, but I would strongly disagree that you don't need to budget. He eludes to not writing checks for bills and then wondering where the money went at the end of the month and that you should not live beyond your means and those two items I agree with. However, if you sit down, put together a live-able budget and assign ever dollar that you will earn that month a name (mortgage/rent, food, utilities, transportation, etc.) you will find that you have some surprises in your spending. My financial adviser says that it takes 90 days to get a budget right, and in my experience he was about right. It took around 90 days to figure out where we were spending and ways that we could make our money work for our live-able situation. Part of the "pay yourself first" is knowing where to put the money so that it makes the best financial sense for you. If you have debt, that should be your #1 priority to eliminate. If you need to save for a large expense coming up (newer car, home repairs, college, etc.) then set aside a sinking fund. A sinking fund is nothing more than a savings account or allocation of money for a larger purchase. Either way, make sure that you're doing what's best long term financial sense. The greatest wealth building tool is your income. Don't let debt and frivolous spending take away your ability to retire wealthy.

Yeah i hear you i think paying yourself first is key its always worked for me and maybe the key is once you pay yourself first then you could figure out what to do by writing out your expenses you know. And yeah the sinking fund is equivalent to the “ emergency fund “ in the latest video where its an amount used for large expenses that are unplanned. Like he said in the other video everyone financial situations are different whether your single, married, have kids, work full time, part time, live at home, own a house, rent. The videos are generalizations for the basic information you know. The key is to do what works best for you and your situation, this channel is just about giving people some information and tips they they might know of or another method to try. If you have a financial planner already he knows your situation the best so he knows whats best for you. I appreciate the dialogue on this already great to hear different point of views! Great conversation!

[pyroguy]

A sinking fund and emergency fund are two completely different things. An emergency fund are for unexpected things. Unexpected medical procedure, hot water heater blows after 2 years, transmission fails on your car just outside of the original warranty, those are emergencies. A sinking fund is where you plan on using your car for 7 years and you know a replacement will cost $30,000 so you pay yourself $30k into an account over 7 years each month, then at the end of 7 years you have $30k. That's a sinking fund. You don't touch that money unless it is going towards the end target.

As for a budget it is applicable for in everyone's situation. A budget allows you to "pay yourself first". In a budget the essential things that need to be taken care of are are a roof over your head, food on the table, keeping the lights on and the heat pumping, and getting to and from work. After that how you choose to spend your money is up to you. Whether you start by paying yourself the 20% or you spend it on whatever else, that is up to you. The budget allows you to see where you are spending your money and make your money behave.

[luke2220]

Originally Posted by pyroguy

A sinking fund and emergency fund are two completely different things. An emergency fund are for unexpected things. Unexpected medical procedure, hot water heater blows after 2 years, transmission fails on your car just outside of the original warranty, those are emergencies. A sinking fund is where you plan on using your car for 7 years and you know a replacement will cost $30,000 so you pay yourself $30k into an account over 7 years each month, then at the end of 7 years you have $30k. That's a sinking fund. You don't touch that money unless it is going towards the end target.

As for a budget it is applicable for in everyone's situation. A budget allows you to "pay yourself first". In a budget the essential things that need to be taken care of are are a roof over your head, food on the table, keeping the lights on and the heat pumping, and getting to and from work. After that how you choose to spend your money is up to you. Whether you start by paying yourself the 20% or you spend it on whatever else, that is up to you. The budget allows you to see where you are spending your money and make your money behave.

Oh sorry i mis read your sinking fund description above. Yeah man im not the finance guy, thats my buddy, im just the filmer/ editor and what not haha

[Dave-ROR]

Originally Posted by pyroguy

Mostly sound financial advice. I agree with the three points, but I will argue that #2 is a little skewed. While paying off the largest interest makes the most mathematical sense, many people get burned out quickly if their largest interest load is also their largest balance loan. By listing the debts smallest to largest, regardless of interest, paying the minimum on everything but the smallest and attacking that one with a vengeance you get to get some "quick wins" which give people a sense of accomplishment. When you see you're making progress you're more likely to stick with it. If you do a budget (which I would add as a 4th item on your list) and squeeze everything out of it that you can to put on paying down the debt the math works out to maybe a month or two extra between the way I suggested vs your way. The difference is people are more likely to stick to a plan if they see progress.

Overall good advice and it's neat to hear your take. I agree with a vast majority of what you said. Emergency fund, mandatory. Pay off debt, absolutely (no debt is good debt IMO). Invest for the long term, one day you'll want to quit working. I know I do. Thanks for the share.

I agree - to a point. To me it depends on the balances.. ie if they are all ~equal then you always target highest interest. If on the other hand 4 are say 3-5k and one is 1k, get rid of the 1k balance just to get that victory.

I also tell friends working on paying off debts to set shorter term goals and have a little celebration at those goals. Doesn't have to be expensive, but one buddy was ~35k in CC debt and he set goals where he would do a track day at 22k, or buy something at 15k that he wants, etc. Was a good motivator and he ended up eliminating all of that debt much quicker since he had some goals to shoot for.

Now.. will power is a requirement for making that happen of course... and one could easily argue that will power has already failed to get $35k in CC debt. But for some people (including myself when I was ~18k in CC debt many many many years ago) it definitely can help you stay on target. I actually found myself passing my "celebration target" just to prove to myself that I could before buying whatever it was I wanted - and that purchase would have to be cash also not additional CC debt.

[jrob56]

Cool to see more content like this out there, so many people dont have a clue. I dont operate on what Id call a traditional budget. But track our spending in a spreadsheet pretty closely. More like very simple analytics on where is money going, where are we creeping, where can we reign in or redirect.

I tend to attack smallest balances first, but our rates are relatively similar. When asked I tend to recommend that unless one rate is absurd.

[luke2220]

Originally Posted by jrob56

Cool to see more content like this out there, so many people dont have a clue. I dont operate on what Id call a traditional budget. But track our spending in a spreadsheet pretty closely. More like very simple analytics on where is money going, where are we creeping, where can we reign in or redirect.

I tend to attack smallest balances first, but our rates are relatively similar. When asked I tend to recommend that unless one rate is absurd.

Thank you! We just want to help share some knowledge with people
Who may not know anything or people who know things and want to try different methods to see what works best for them and their families. Thats key is to find something that works best for you and stick with it. Everyone is different budgeting works great for alot of people and some people work better not budgeting. Glad you enjoyed the content, feel free to check out the rest of our channel and subscribe

[pyroguy]

Originally Posted by Dave-ROR

I agree - to a point. To me it depends on the balances.. ie if they are all ~equal then you always target highest interest. If on the other hand 4 are say 3-5k and one is 1k, get rid of the 1k balance just to get that victory.

I also tell friends working on paying off debts to set shorter term goals and have a little celebration at those goals. Doesn't have to be expensive, but one buddy was ~35k in CC debt and he set goals where he would do a track day at 22k, or buy something at 15k that he wants, etc. Was a good motivator and he ended up eliminating all of that debt much quicker since he had some goals to shoot for.

Now.. will power is a requirement for making that happen of course... and one could easily argue that will power has already failed to get $35k in CC debt. But for some people (including myself when I was ~18k in CC debt many many many years ago) it definitely can help you stay on target. I actually found myself passing my "celebration target" just to prove to myself that I could before buying whatever it was I wanted - and that purchase would have to be cash also not additional CC debt.

I agree that if you have all the same balances then definitely attack the highest interest rate. However, how often do you have 2 or more exactly the same balances? The end goal of paying off debt is actually getting out of debt. Small wins are essential to keep people motivated.

As for your small victory celebrations, I agree. My wife and I were so laser focused getting out of debt that we didn't have a whole lot of milestone celebrations, even though I wish we had. I think that if you have a large debt (which can be defined by a case by case basis) that milestone celebrations are a good way to keep motivated. Of course those celebrations need to be reasonable. $50, $100 celebrations aren't going to delay you getting out of debt. However, if you say "Oooo! I paid off $2,000 of debt! Let's go buy a new car!" then that's outrageous.

Finally, will power is essential as well. Financial well being is 20% knowledge and 80% behavior. The 20% is vital to know what to do, but the 80%, which often times sucks, is necessary and can be very difficult.

[Iron Lung Jimmy]

Originally Posted by pyroguy

It is a good video to watch, but I would strongly disagree that you don't need to budget. He eludes to not writing checks for bills and then wondering where the money went at the end of the month and that you should not live beyond your means and those two items I agree with. However, if you sit down, put together a live-able budget and assign ever dollar that you will earn that month a name (mortgage/rent, food, utilities, transportation, etc.) you will find that you have some surprises in your spending. My financial adviser says that it takes 90 days to get a budget right, and in my experience he was about right. It took around 90 days to figure out where we were spending and ways that we could make our money work for our live-able situation. Part of the "pay yourself first" is knowing where to put the money so that it makes the best financial sense for you. If you have debt, that should be your #1 priority to eliminate. If you need to save for a large expense coming up (newer car, home repairs, college, etc.) then set aside a sinking fund. A sinking fund is nothing more than a savings account or allocation of money for a larger purchase. Either way, make sure that you're doing what's best long term financial sense. The greatest wealth building tool is your income. Don't let debt and frivolous spending take away your ability to retire wealthy.

I don't disagree with you about budgets, but with his "pay yourself first" idea the budget will take care of itself. If you earn $100 and put away $20 for yourself, then you have $80 left and you will find out soon enough what expenses need to be adjusted. The budget will be self-defining.

And budgets tend to be intimidating, unpleasant, or too complicated for a lot of people so this back door approach is not a bad idea. It's a lot easier for most people to put away $20 first then figure out how to allocate the remaining $80 than to try to budget all your expenses so you have $20 left over.

OP - I like the videos. Good info presented clearly and concisely. I have to ask, though - what's up with the kitchen background? It's kind of strange.