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Welcome to personal finance for
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long-term investors, where we believe
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Benjamin Franklin's advice that an
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investment in knowledge pays the best
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interest both in finances and in your
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life. Every episode teaches you personal
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finance and long-term investing in
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simple terms. Now, here's your host,
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Jesse Kramer. Welcome to Personal
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Finance for Long-Term Investors, episode
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114. I'm Jesse Kramer. By day, I work at
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a fruiary wealth management firm helping
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clients nationwide. You can learn more
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at bestinterest.blog/work. blog/work.
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The link is in the show notes. And by
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night, I write the best interest blog. I
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host this podcast. I put out a weekly
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email newsletter. All of which helps
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busy professionals and retirees avoid
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mistakes and grow their wealth by
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simplifying their investing, taxes, and
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retirement planning. Later in today's
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episode, Kellen Klein will be joining
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me. Kellen is is local to me here in
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Rochester, and he's the co-founder of
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the Savvy Couple Brands, a huge online
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personal finance platform that he runs
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with his wife Britney. been recognized
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by Forbes and Time and other
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publications. And Kellen has a really
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unique story. He went from working
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full-time as a a jail deputy in the
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county jail to paying off six figures of
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debt, quitting that job in the jail
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while he was building this amazing
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business all over the course of a few
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short years, especially in hindsight.
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This isn't going to be an episode where
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all we do is kind of sing Kellen's
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praises and and tell you to go check
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them out, but rather the point of this
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episode is kind of learn about the
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process and the risks and the planning
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that went into starting a business, that
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went into growing that business, that
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went into the the monumental decision of
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quitting his then career to pursue the
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business full-time, and also some of the
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financial planning and household
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financial sacrifices required to ensure
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that Britney and Kellen maximize their
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probability of success. And now, why are
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we talking about those things today?
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Because of the thousands of you
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listening to this podcast, I know for a
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fact that plenty of you have ideas
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rattling around in your heads to maybe
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leave your 9 to5 early, to start your
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own business, to pursue some sort of
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passionate side hustle, to start doing
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contract work or consulting part-time as
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part of your retirement plan. And like
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all major projects in life, doing one of
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those things requires a lot of planning,
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a lot of thinking, a lot of foresight.
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And I think we can all learn something
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interesting today from Kellen's
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successes, from the stories he has to
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tell us, and also from the failures
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really, from the good, the bad, and the
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ugly of the real life lessons that
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Kellen and Britney went through to start
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their brand, to start their business.
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But before Kellen joins us today, we do
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have a review of the week and then some
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monologue thoughts from me. The review
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of the week from Clint Money. Great for
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the beginner to the expert. Five stars.
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Jesse does a great job of explaining
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financial topics in great detail so
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nobody gets left behind. The guests he
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has on his show are top-notch as well.
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I'm looking forward to years of great
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content. Well, Clint, thank you very
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much for the kind words. Feel free to
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drop me an email at jessebinterest.blog
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and I will send you a super soft podcast
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t-shirt. And before Kellen joins us,
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before we take a deep dive into
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entrepreneurship, into owning your own
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business, into a side hustle, you need
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some financial flexibility to pull that
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off. So, I was thinking about this
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article I wrote in March of 2024. At the
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time, my friend's daughter, she was 21
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years old. She had just bought her first
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car, a very big financial move, and she
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had lots of options of what car she
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wanted to buy. Was she going to look
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for, you know, the used Honda, the used
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Toyota, the used Kia? Lots of frugal
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experts would point to that kind of
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decision. Uh, was she going to buy
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something was new, but, you know, maybe
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reasonable? That's what I did for for my
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first car. I bought a brand new 2012
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Toyota RAV 4. It was new at the time,
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but I thought a pretty reasonable car to
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buy. I drove it for 160,000 miles or
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something like that. and I got my money
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out of it. Or was my friend's daughter
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going to go all out? There are places to
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be and she's got people to impress and
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she wants a cool car. Well, for better
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or for worse, this young woman went with
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option three. She bought a 2024 Ford
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Bronco for roughly $50,000. A very cool
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car, one of the most popular cars in
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America since the Bronco came back to
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life in 2021. And that cool factor, if
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you will, was essential for this young
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woman. It's what she wanted. But by
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stretching her finances with this
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purchase, she damaged her financial
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flexibility in other areas of life. That
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ability to absorb financial downfalls,
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to react to financial changes, to find
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contentment at various consumption
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levels. I think about the world of
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physical fitness where stretching
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improves our physical flexibility and
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that flexibility prevents muscle or
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joint related injuries or what have you.
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But I also think that maintaining proper
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financial flexibility helps cushion the
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financial blows that life will
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inevitably throw your way, the sudden
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expense, the loss of a job when your dog
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eats the tennis ball and needs, you
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know, emergency veterary care. Those
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kind of flexibilities are really
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important. And my friend, whose daughter
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bought the Bronco, discussed how she
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felt this great discontent with the idea
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of driving around in a used junky car,
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which I totally get. all else equal. A
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cool new car is way better and way
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cooler than an old junky car, but all
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else isn't equal. That's the problem. I
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mean, namely, the price, more
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accurately, that the cost per mile of
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the Bronco is going to be way more than
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that of the used junky car. And we all
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know someone who fits this mold. They
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just have to have the nicest stuff. And
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I think for those people, it is
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important that we try to hit them or or
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if you find yourself in those shoes. I I
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know in some places in life I might find
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myself in those shoes and I try to hit
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myself with this all-timer of a quote
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which is look around you all of that
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stuff it used to be money and all of
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that money it used to be time the
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question becomes are you content are you
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fulfilled are you happy and it's
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different strokes for different folks
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some people need that fancy Bronco while
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other people despise spending their
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hard-earned dollars on a depreciating
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asset and the question is how much of
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your time are you willing to trade paid
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for that stuff. I think it's a
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superpower to feel content and to feel
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fulfilled at multiple spending levels.
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And that idea, I don't think, can be
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emphasized enough. Overspending is
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typically tied to some sort of search
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for contentment. And very rarely is that
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contentment found, for example, behind
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the wheel of a car, behind the wheel of
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a Ford Bronco. And we are all different.
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I get that. Our contentment flexibility
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will vary depending on the topic. We
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each have areas of life where we say,
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"Hell yes." and we happily pay higher
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prices. And for you, it might be nice
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dinners or dog toys or a nice bottle of
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wine. For me, it's squash rackets or
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books for my for our daughter. Lots of
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books. Lots of books for our daughter.
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High quality baking ingredients. I like
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making a good batch of cookies. And I
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don't mind spending money on that stuff.
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We each have the different stuff that we
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want to spend money on. But if you can
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still be happy at various spending
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levels, your financial life is bound to
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improve. And to some, financial
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flexibility means having room in your
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budget. You know, life will throw you
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curveballs. Can you roll with the
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punches and keep your head above water?
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You've probably seen headlines before
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like, you know, 47% of Americans can't
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afford a $1,000 emergency expense. Now,
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whether that headline is true or just
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some sort of bastardization of polling
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data, the fact remains a lot of people
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don't have much room in their budgets
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and their situation is kind of like a
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pane of glass and it shatters under the
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slightest bump. A healthy emergency fund
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solves that problem by providing them
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with flexibility. And it's kind of
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ironic because their flexibility is
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created in the first place by saying no,
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right? We have to say no to things in
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order to build that flexibility in our
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lives. But then having that flexibility
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empowers us to eventually start saying
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yes to things. We have to choose not to
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spend money to to grow the emergency
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fund. A penny saved is a penny earned.
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But the benefit of our budgetary
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flexibility is eventually, hey, some
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sudden fun spending opportunity arises
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and we get to say yes. I think it's also
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worth thinking about geographic
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flexibility. You know, would you be
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happy living in New York City? Would you
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also be happy living in, I don't know,
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rural Iowa? If you have the lifestyle
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flexibility to move to a low cost of
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living area, that's a pretty amazing
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financial superpower. Just for kicks and
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giggles, I compared New York City to Sou
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Falls, Iowa. The overall cost of living
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is more than 100% higher in New York
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City. And if you're listening to this in
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Iowa, let me know. Specifically, New
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York City rent is about 300% higher than
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Sous City. Restaurant prices are about
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100% higher. Groceries are about 75%
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more. So, if you're tied down to a high
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cost of living area, tied down,
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literally, you're not flexible in that
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way, then it kind of just is what it is.
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I'm not going to tell someone to abandon
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New York City and abandon your family to
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save money in Iowa. But if you can move
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to a low cost of living area, even if
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you can move to a midcost of living
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area, what's stopping you? I know since
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co that's happened a lot around here in
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upstate New York in Rochester and
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Buffalo and Syracuse. I just
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specifically here in Rochester. A lot of
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families, a lot of younger families who
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maybe originally were from Rochester,
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they left the nest, so to speak. They
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settled in greater New York City. They
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settled in DC. They settled in Boston,
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you know, Chicago, mostly central and
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east coast cities. And then during
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COVID, probably because of the remote
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work and all the flexibility that gave
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them, they'd come back to Rochester,
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making us one of the hottest housing
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markets in the country. Because that
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same family that maybe was trying to get
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a pretty normal, quote unquote normal
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2,000 foot house in Boston for a million
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half dollars, that million half dollars
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buys them one of the nicest houses in
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Rochester. And in fact, they can get a
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much nicer house than they could in
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Boston for probably like half the price
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here in Rochester. Anyway, it's a story
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for another day, but the point again is
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geographic flexibility. Next, I think
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about the question, does money actually
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buy happiness? One of my colleagues,
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Chris, when he meets with clients, he
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often says, I'm not sure if money buys
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happiness. Maybe it's different for
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different people, but money certainly
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buys flexibility. And for me,
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flexibility does often lead to more
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happiness. And I think he's got a really
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good point. Most of us want options in
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life and that's what financial
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flexibility is all about. We want the
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option ideally to afford anything but
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you know like Paula Pant might say if
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you know Paula you can afford anything
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but you can't afford everything. And
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that's a really important financial
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flexibility idea to take home with us.
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Next when I was thinking of Kellen's
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story what you're all about to hear from
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Kellen's story today. I think of that
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fork in the road that he and his wife
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Britney must have faced. That fork in
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the road that said do we continue? Does
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Kellen continue down his career of being
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a a guard at the county jail or does he
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go for broke and run the business? And
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it reminded me of a fork in the road, so
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to speak, from the financial
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independence movement. So, this is from
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an article December 2022 I wrote called
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Two Roads to Financial Independence. And
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I was reminded of, you know, Robert
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Frost's poem, Two Roads Diverged in a
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Wood, and I I took the one less traveled
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by. And that has made all the
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difference. Now, most people know of
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that poem, The Road Not Taken,
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especially those last few lines that I
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just quoted. And most people interpret
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the poem as well, Robert Frost's choice,
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his choice made all the difference. And
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it made all the difference in a good
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way. And so, Robert Frost is telling us
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to to break the mold, to be different,
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to create some extraordinary life,
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right? Two roads diverged in a wood. I
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took the one less traveled by, and that
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has made all the difference. So, do the
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the unique thing and make all the
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difference. But if we actually read the
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poem closely, Frost doesn't really make
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that claim. The road less traveled is
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neither good nor bad. He's not really
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passing any judgment on the path that
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one takes. Instead, his point is that
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the decisions we make in life, like a
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fork in the road. They steer us in a
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certain direction that cannot be undone.
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And because of that, even a tiny
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decision can make quote unquote all the
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difference. Maybe good, maybe bad, but
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it can make all the difference in your
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life. And I think of it, you know, one
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road leads to another road or one fork
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leads to another fork and then another
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fork and then another fork. And that
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Robert Frost, he would never again find
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himself at that particular intersection.
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His choice left or right led to these
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future desperate decisions, but would
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never lead back to where he stood at
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that moment, to that particular
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decision. And he says this in the poem.
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He says, "Yet knowing how we leads on to
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Wei, I doubted if I should ever come
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back. In the long run, a simple fork in
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the road can fundamentally change your
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life. It's a little bit like chaos
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theory or that apocryphal idea that a
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butterflyy's flight in South America
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changes the direction of a major
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hurricane over the Atlantic. That small
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changes in input can cause massive
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shifts in output. And time only moves in
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one direction. There are no
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counterfactuals in life. If I had done
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this instead of that, I would be over
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here instead of over there. You can't
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pretend you would know how that actually
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works out. You can't pretend you would
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know what would have happened if you had
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made the other choice. You can't be
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certain. But nevertheless, we do dwell
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on opportunities missed. If I had gone
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to that party in grad school, I would
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have met Margot Robbie and now I'd be
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married to a famous actress. Well, you
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can't really do that. But we never
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consider, we never even really begin to
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think about disasters that we've
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averted. I think this is a really cool
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thought. Maybe maybe you do, too. Maybe
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you've never thought about it. But, you
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know, maybe if id gone to that party
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with Margot Robbie, some distracted
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driver would have t-boned my car at the
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stoplight and and broken my leg. And
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just think about it. When was the last
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time you considered that a few mundane
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choices in your past have probably saved
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your life by avoiding some sort of fatal
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accident? You might scoff, but that's
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certainly a a train of thought less
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traveled. And as Robert Frost writes in
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the poem about sitting there at that
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fork in the road, he says, "And be one
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traveler long I stood and looked down
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one as far as I could to where it bent
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in the undergrowth, then took the other
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as just as fair." So the point being is
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that you can only take one path. And now
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time for the second path of this little
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um diet tribe about Robert Frost and and
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the fire movement, the financial
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independence retire early movement. It
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strikes me as this Frostian bargain. And
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yes, I know it's a Fouian bargain, but
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this is a Frostian bargain. And the
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basics of FIRE are pretty
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straightforward. If you earn more, you
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spend less. You can become financially
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independent, no longer tied to your
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employer's mandates. You can retire much
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earlier than traditional Western
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civilization retirement dates. Fire
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folks, they generally take Robert
00:14:07
Frost's path. They take the path less
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traveled. They, you know, assue the
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common nine-to-five for 40 years career
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by striving usually for higher incomes,
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definitely by uh lowering their spending
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and by investing the difference. And
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that combination for them, it makes all
00:14:23
the difference. But like those who kind
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of misread Robert Frost's poem, the FIRE
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movement occasionally conflates
00:14:30
different with better. And different and
00:14:32
better aren't always the same thing. And
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now, granted, I'm I'm cherry-picking
00:14:35
these, but I I picked these five
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headlines from the financial
00:14:38
independence subreddit in recent months,
00:14:41
and I want to see if you can spot the
00:14:42
common thread. So, again, I'm just going
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to read five headlines here. I retired
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early at 36. It's been 2 years, and I'm
00:14:48
feeling lost. Your fire obsession may be
00:14:51
a symptom of stress. I fired at 30 and
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now I'm lost, depressed, and don't know
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what to do. Living in the future or why
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fire won't make you happy. And then the
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last one is the pursuit of fire just a
00:15:04
temporary distraction from unhappiness.
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And again, I did cherrypick those
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headlines. There are also many great
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stories of fire, financial independent
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success, and the road less traveled
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after all can make all the difference in
00:15:16
both directions. But yeah, fire is the
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road less traveled, but it's not always
00:15:20
it's not always the better road. Now, my
00:15:22
personal story is just another example.
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Fire was a huge part of my initial
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interest in personal finance and
00:15:28
investing. And that interest led to the
00:15:30
creation of the best interest. It led to
00:15:32
me changing careers. It led to this
00:15:33
podcast. And that's just a huge
00:15:35
fundamental part of my life when I think
00:15:37
back on it. And I was full steam ahead
00:15:40
on the fire path in my old engineering
00:15:42
career. I was on the fastest path to
00:15:44
fire that I could possibly muster. I was
00:15:46
Mr. Rice and Beans, Mr. Coffee at home,
00:15:49
brown bag lunches every single day. But
00:15:51
stories that are similar to the the
00:15:53
headlines, the five headlines that I
00:15:54
just read. I felt something in my life
00:15:56
that something wasn't quite right. I was
00:15:58
on a better path, right? I mean, that's
00:16:00
what I was asking myself. This is
00:16:01
supposed to be the better path, but if
00:16:03
it's the better path, why doesn't always
00:16:04
feel better? And for years, I couldn't
00:16:06
really put my finger on the problem.
00:16:08
Now, coincidentally, the work that I'm
00:16:10
doing on the Best Interest blog here on
00:16:12
this podcast, the work that I'm now
00:16:13
doing full-time helped me discover my
00:16:16
issue. And simply put, I didn't enjoy
00:16:18
the day-to-day work of my engineering
00:16:20
career. And rather than running towards
00:16:22
early retirement, I was really using
00:16:24
financial independence to run away from
00:16:26
an unfulfilling job. I found out that
00:16:28
the mind starts to rebel when you force
00:16:31
it to be passionate about escapism.
00:16:33
That's where I found myself. But I did
00:16:35
love the work of writing, of podcasting,
00:16:37
of helping my readers and now my clients
00:16:39
achieving their financial goals. And
00:16:41
that's something this is something that
00:16:43
I'm not looking for an escape route
00:16:45
from. If anything, I wanted more time to
00:16:47
write to podcast to help people. And now
00:16:50
that I've been doing that, now that I've
00:16:52
been working full-time in financial
00:16:53
planning for three and a half years as I
00:16:55
record this, I'm no longer really
00:16:57
focused on reaching fire. I just really
00:16:59
like doing what I do. And sure, I'm
00:17:02
still watching our household finances.
00:17:04
I'm still making sure that we're
00:17:05
investing our money wisely, but I've
00:17:07
really separated the FI, the financial
00:17:09
independence from the RE, the retirement
00:17:11
early. I think financial independence is
00:17:13
something we all want at the end of the
00:17:15
day. But I'm no longer racing to an
00:17:17
early retirement. Instead, I'm now on
00:17:19
this slow FI path. I'm saving less. I'm
00:17:21
spending more. Yes, you heard that
00:17:23
right. I'm saving less. I'm spending
00:17:25
more. I'm still saving. I'm just not
00:17:26
saving quite as much as I was when I
00:17:28
was, you know, Mr. Rice and Beans. I'm
00:17:30
enjoying the present rather than wishing
00:17:31
it all away, rather than straining
00:17:33
towards this supposedly better future.
00:17:36
And in some ways, that makes me an
00:17:37
outlier when I compare myself to other
00:17:40
financial bloggers or other fire heroes
00:17:43
or other spreadsheet nerds. I'm on the
00:17:45
road less taken. But for me, it's making
00:17:47
all the difference. Okay, that's that
00:17:50
for that article. But then last the last
00:17:52
one before Kellen joins us today. It's a
00:17:53
little bit maybe off topic, but it
00:17:55
struck me because I've gotten a bunch of
00:17:56
emails in the last month, in the last 6
00:17:58
weeks, just a bunch of emails about
00:18:00
people inheriting money from relatives
00:18:02
who have passed away. And based on
00:18:04
demographics, based on aging baby
00:18:06
boomers, I think that trend is just
00:18:07
going to keep getting stronger and
00:18:09
stronger and stronger. people like us,
00:18:11
people like those of us listening to
00:18:12
this podcast right now. We are going to
00:18:14
be inheriting money in the future. So, I
00:18:16
wanted to share this advice I gave to
00:18:18
someone who recently inherited $600,000,
00:18:20
a pretty big chunk of change. So, here
00:18:22
are all the thoughts and the questions I
00:18:24
recommended that she work through. So,
00:18:26
in this particular case, Felicia and her
00:18:28
husband received a $600,000 inheritance.
00:18:30
She said they earn modest incomes. They
00:18:32
live pretty modestly. They don't know
00:18:33
what to do with the money or how to best
00:18:35
handle it. They have about $40,000 of
00:18:37
student debt at a 5% interest rate. They
00:18:40
have a apartment, but they'd like to buy
00:18:41
a house. Their ideal home would cost
00:18:43
$500,000. They already have $50,000 set
00:18:46
aside for that. They contribute to their
00:18:47
401k accounts. They contribute to Roth
00:18:49
IRA accounts. They've never earned
00:18:51
enough money to be able to max them out.
00:18:52
And they're at a loss in a few areas
00:18:54
when it comes to the inheritance. What
00:18:56
don't they know, right? We don't know
00:18:58
what we don't know. And what are the big
00:18:59
things that they're likely missing? They
00:19:01
have questions about taxes. Do they need
00:19:02
to be worried about taxes this year or
00:19:04
in future years? They're thinking about
00:19:06
spending, right? $600,000. This seems
00:19:08
like a really big chance for them, but
00:19:11
they're scared. In her words, in
00:19:12
Felicia's words, they're petrified of
00:19:14
spending it and ruining their future.
00:19:16
But at the same time, again, in her
00:19:18
words, they don't want to die on a pile
00:19:20
of unspent cash. And then last, of
00:19:22
course, is investing should her
00:19:24
investing strategy change. So, what an
00:19:26
interesting question, and again, what a
00:19:28
question that will likely apply to a lot
00:19:30
of us over the coming years. So, let's
00:19:33
start with taxes. Taxes are pretty easy
00:19:35
one that we can tackle quickly. And
00:19:37
we'll start with inheritance taxes. And
00:19:39
it's important we're going to
00:19:40
differentiate here between inheritance
00:19:41
taxes and estate taxes. Inheritance
00:19:44
taxes get charged to the recipient of an
00:19:46
inheritance like Felicia. Estate taxes
00:19:49
get charged to the estate of the
00:19:51
deceased person prior to the money being
00:19:54
distributed to the inheritors. So in
00:19:56
Felicia's case, she already dodged the
00:19:58
estate taxes. Estate taxes might have
00:20:00
applied to the person who died in
00:20:02
Felicia's case, but not to Felicia
00:20:03
herself. Anyway, we're going to go back
00:20:05
to inheritance taxes, those that get
00:20:07
charged to the recipient like Felicia.
00:20:09
Thankfully, there is no federal
00:20:11
inheritance tax. Six states, although I
00:20:14
think actually one of the six states, I
00:20:15
don't remember which one. I think it's
00:20:17
only five states now. I think one of the
00:20:18
six states recently ended their
00:20:20
inheritance tax. But either way, five or
00:20:22
six states charge inheritance taxes.
00:20:24
Nebraska, Iowa, Kentucky, Pennsylvania,
00:20:27
New Jersey, and Maryland. So,
00:20:29
inheritance tax, estate taxes, we'll go
00:20:31
on to estate taxes, as I said before,
00:20:33
get charged to the estate of the
00:20:34
deceased person prior to money being
00:20:37
distributed to the inheritors. There is
00:20:39
a federal estate tax, but it kicks in at
00:20:42
enormous amounts of wealth. $14 million
00:20:45
for individuals, $28 million for
00:20:47
couples. And then some states, though,
00:20:49
it's important to have estate taxes as
00:20:52
well. Now, I believe this is a a pretty
00:20:54
comprehensive list of the the states
00:20:56
that have estate taxes. Washington,
00:20:58
Oregon, Minnesota, Illinois, Vermont,
00:21:01
Maine, Massachusetts, Rhode Island,
00:21:03
Connecticut, New York, New Jersey,
00:21:06
Maryland, Delaware, Washington DC, and
00:21:10
Hawaii. I think that's it for state
00:21:13
estate taxes. But either way, if you
00:21:14
live in one of those states, it's worth
00:21:16
understanding what your state's estate
00:21:17
taxes are. or even if you don't live in
00:21:19
one of those states, you might just want
00:21:20
to double check and make sure that I I
00:21:21
got that right for your state. Capital
00:21:23
gains taxes. How do capital gains taxes
00:21:25
apply to inheritances? Usually, they
00:21:27
don't, especially at the time that the
00:21:29
inheritance is given. But if the assets
00:21:32
in your inheritance, maybe stocks or a
00:21:34
home, if that appreciates in value, you
00:21:38
will probably eventually owe capital
00:21:41
gains taxes if and when you decide to
00:21:43
sell that asset. So again, if you
00:21:45
inherit a house from grandpa, if you
00:21:47
inherit stocks from grandpa, you don't
00:21:49
owe any capital gains when you inherit
00:21:51
that asset. But if you choose to hold on
00:21:54
to that asset for a long time and that
00:21:55
asset grows in value and then you sell
00:21:57
it, you will likely owe capital gains
00:22:00
taxes on the difference between the
00:22:01
price you sell it at and the value when
00:22:03
you inherited it. And then last, income
00:22:06
taxes. Again, income taxes generally
00:22:08
don't apply to inheritances except in
00:22:11
one very common case, which is an
00:22:12
inherited 401k or an inherited IRA. The
00:22:15
deceased person likely never paid income
00:22:18
taxes on any of those traditional
00:22:20
retirement account contributions. So,
00:22:22
the IRS mandates that the person who
00:22:24
inherits the account, that's us, pay
00:22:27
income taxes from their inherited IRA.
00:22:29
As of this recording, you know, moving
00:22:31
forward, I should say for non-spouses,
00:22:34
when you if you inherit an IRA from
00:22:36
someone other than your spouse, the
00:22:38
current tax code stipulates that all of
00:22:39
the assets in that inherited IRA must be
00:22:42
withdrawn within 10 years of the
00:22:44
deedent's death and that uh you, the
00:22:47
inheritor, will pay income taxes on
00:22:49
those distributions based on your income
00:22:52
tax rates. So, let's move on to
00:22:54
spending. Felicia's next concern. and
00:22:55
her concern over spending, I think, is
00:22:57
the epitome of personal finance, right?
00:22:59
$600,000 is a lot of money, no matter
00:23:01
who you are, but especially if you've
00:23:03
come from a modest background, like
00:23:04
Felicia said, and I think she's right to
00:23:06
see this inheritance as a really big
00:23:08
financial opportunity. But I really want
00:23:10
to dispel Felicia's feeling of being
00:23:13
petrified. This inheritance is an
00:23:15
opportunity for good, for flexibility,
00:23:17
like we just talked about. It's an
00:23:18
opportunity for choice, for some fun,
00:23:21
and and just ask yourself, would you
00:23:22
rather have $600,000 or zero? And the
00:23:25
fact that we all have the same answer to
00:23:27
that question suggests that Felicia's
00:23:29
inheritance, at least financially, is a
00:23:31
positive thing for her, right? Not
00:23:33
notwithstanding the fact that someone in
00:23:34
her life died. I realize that's a
00:23:36
negative thing again, most likely. But
00:23:38
the fact that she has the $600,000,
00:23:40
that's a positive thing. So, where do
00:23:42
the negative feelings come from? It
00:23:44
sounds like part of Felicia's fear is
00:23:46
the potential, and again, the potential
00:23:48
future regret if she and her husband
00:23:50
somehow screw up this scenario. uh they
00:23:53
never thought they'd get this lucky to
00:23:55
inherit $600,000. So what if they don't
00:23:57
seize that opportunity, right? What if
00:23:58
they let themselves down? What if they
00:24:00
let their family down? It's like Uncle
00:24:02
Ben in Spider-Man. With great power
00:24:04
comes great responsibility. Maybe
00:24:06
there's the same thing here. With great
00:24:08
inheritance comes great responsibility.
00:24:09
And I think this is why financial
00:24:11
planning matters. You know, Felicia and
00:24:12
her husband, they need to build a plan
00:24:15
for their assets. Something like the
00:24:17
financial order of operations is a great
00:24:19
starting place based on the details that
00:24:21
Felicia shared with me that I shared
00:24:23
with you at the beginning of this little
00:24:25
uh reading. Their plan should probably
00:24:27
include somewhere in there a small
00:24:29
amount of money for immediate fun use.
00:24:32
Now, there's no hard rule, but something
00:24:34
in the ballpark of, I don't know, 5% of
00:24:37
the total or or $10,000, something like
00:24:39
that. It's like, Felicia, go take that
00:24:41
trip you've always been wishing for or
00:24:43
whatever that is for you. The financial
00:24:44
plan should probably also include some
00:24:46
debt payoff. Considering Felicia brought
00:24:48
it up, I would recommend she immediately
00:24:50
pay off the $40,000 in student debt.
00:24:52
Especially, you know, assuming that
00:24:54
payments have started up again for her,
00:24:56
there's not really any sense in paying
00:24:57
off loans while the payments and
00:24:59
interest are deferred. I think it'll
00:25:00
ease her burden. Again, she cared enough
00:25:02
about it to mention it in your question.
00:25:05
And that payoff is is the equivalent to
00:25:07
a 5% return on those assets. It doesn't
00:25:10
mean that debt payoff should always be
00:25:12
part of all inheritance scenarios, but
00:25:14
in this case, I think it's smart advice.
00:25:16
I think Felicia should probably also
00:25:18
earmark some of the money for a home
00:25:20
purchase. She talked about $500,000
00:25:23
being their home budget. 20% down is a
00:25:25
typical home payment. She should earmark
00:25:27
$100,000 for the home payment. Granted,
00:25:30
more is probably better. There are, you
00:25:32
know, pesky closing costs. And if
00:25:34
Felicia's home purchase timeline is
00:25:36
ASAP, if she and her husband want to buy
00:25:38
a home as soon as possible, I'd
00:25:40
recommend she set aside at least
00:25:42
$100,000 today into a high yield savings
00:25:44
account for that specific purpose. The
00:25:46
next thing I think should be part of her
00:25:48
financial plan is what I call endowed
00:25:50
spending. She talked about the desire to
00:25:52
avoid dying on a pile of unspent cash.
00:25:55
And I think it makes sense for her to
00:25:57
pre-plan a small percentage of spending
00:25:59
every year. Maybe something in the 1 to
00:26:01
2% range. you know, $5,000, $10,000,
00:26:04
$15,000 feels about right. Felicia could
00:26:06
spend it on fun. She could spend it on
00:26:08
making many small facets of life a
00:26:11
little bit better. And to accomplish
00:26:12
this, I think Felicia should think about
00:26:14
money, again, I called it endowed
00:26:16
spending, almost in the same way that a
00:26:18
college thinks about its endowment. She
00:26:20
could take a chunk of money. Maybe it's
00:26:22
$150,000 or $200,000 today. Invest it
00:26:26
into a conservative diversified
00:26:28
portfolio for the specific purpose of
00:26:30
annual purposeful spending. And we'll
00:26:33
talk about that idea again down when I
00:26:34
when I mention investing. And if you're
00:26:36
keeping track at home, we've earmarked
00:26:38
maybe 300 to 350,000 of Felicia's
00:26:41
$600,000 inheritance. We talked about
00:26:44
maybe 10 $20,000 for some fun right
00:26:46
away. We talked about $40,000 to pay off
00:26:49
college debt, $100,000 for a home down
00:26:52
payment, and maybe $150 or $200,000 for
00:26:55
that ongoing endowed spending. But now
00:26:58
the question comes up, what do we do
00:26:59
with the remaining 300,000 or 4 million?
00:27:03
And that remainder of Felicia's
00:27:04
inheritance should be, in my opinion,
00:27:06
invested for the long haul. But other
00:27:08
portions of her quote unquote spending
00:27:10
assets should probably be invested, too.
00:27:12
Now, what do I mean? Well, her specific
00:27:14
investing allocation depends on the
00:27:16
unique goals, the unique timelines of
00:27:18
her life and of her assets. So, for the
00:27:20
home purchase, we already covered that
00:27:22
the $100,000 should be invested, maybe
00:27:25
deposited is the better word, into a
00:27:27
high yield savings account, earmarked
00:27:29
for the home purchase. It's in cash.
00:27:31
It's safe uh insured by the FDIC earning
00:27:34
something like 4% in today's interest
00:27:36
rate environment. Now, the endowed
00:27:38
spending that maybe she sets aside $150
00:27:40
or $200,000 for that annual purposeful
00:27:43
spending, that money should be invested.
00:27:46
Now, truly invested. I don't think it
00:27:47
should be in cash. Now, why is that?
00:27:49
Well, some of the $150,000 certainly is
00:27:52
short-term. You know, again, if she's
00:27:54
spending, call it $10,000 a year out of
00:27:57
this endowment, one of the $10,000
00:27:59
chunks is going to happen this year, and
00:28:01
that's short term. But a lot of those
00:28:03
$10,000 expenditures are going to be
00:28:06
long-term. And if we think about that
00:28:07
$150,000 as a true endowment like a
00:28:10
university might, then the $150,000 in
00:28:13
principle should mostly be left alone.
00:28:15
Should be left alone at least as much as
00:28:17
possible. So something like a 50% bond
00:28:19
and 50% stock allocation for that
00:28:21
$150,000
00:28:23
combines Felicia's need for both
00:28:25
short-term capital, but also for this
00:28:28
reasonably conservative long-term
00:28:30
growth. And then last, we have Felicia's
00:28:32
true long-term money. The remaining
00:28:34
$300,000, $250,000, again, depending on
00:28:37
our math, should be invested for the
00:28:39
long long run. Depending on Felicia's
00:28:42
specific risk tolerance, a stock
00:28:43
allocation of 70% all the way up to 100%
00:28:46
is probably appropriate with the
00:28:48
remaining assets, the difference from
00:28:50
100% those assets and bonds. Or maybe
00:28:53
she's seeking further diversification,
00:28:55
real estate alternatives, what have you.
00:28:57
Now, for now, we can say she invests
00:28:59
those assets at 80% stocks, 20% bonds.
00:29:02
And again, if we depending on the exact
00:29:05
numbers that we use here, we can see
00:29:06
that Felicia's total portfolio kind of
00:29:09
from the bottom up is roughly 25% cash.
00:29:12
So, if we add up the the assets that
00:29:14
were already on Felicia's balance sheet,
00:29:16
plus the decisions we've made with this
00:29:18
new $600,000, we see that Felicia's
00:29:21
total kind of liquid portfolio becomes
00:29:24
approximately 25% cash, 25% bonds, and
00:29:28
about 50% stocks. Now, that might be a
00:29:31
big change from Felicia's prior
00:29:32
investing allocation, but our logical
00:29:35
investing framework from the bottom up,
00:29:37
right, that ought to work for just about
00:29:39
anyone at just about any crossroads in
00:29:41
their life. First, we identified her
00:29:43
goals. Then, we applied dollar amounts
00:29:46
to those goals. We determined timelines
00:29:48
to reach those goals. To reach those
00:29:50
dollar amounts and then we invested
00:29:52
appropriately. Shorter timelines
00:29:54
demanded lower risk assets. Longer
00:29:56
timelines demanded higher risk assets.
00:29:58
So, from the bottom up, we built this
00:30:00
portfolio. So, what else? What else did
00:30:03
Felicia and and I potentially missed so
00:30:05
far? Well, Felicia and her husband
00:30:07
should certainly start maxing out their
00:30:09
Roth IRA every year. She mentioned that
00:30:11
they contribute, but they've never maxed
00:30:12
it out. If nothing else, they should
00:30:14
pull 13, I guess $14,000 from their
00:30:17
long-term taxable money, deposit that
00:30:20
into their Roth IAS to make sure they're
00:30:21
maxing out uh their Roths basically
00:30:23
every year going forward. Should they
00:30:25
also max out their 401k? Well, they
00:30:27
should definitely get the match, right?
00:30:28
Always get the employer match. It's free
00:30:30
money. But beyond that free money, I
00:30:32
think they can weigh the pros and cons,
00:30:33
the benefits, the detriments of the 401k
00:30:36
tax advantage against the cost, the
00:30:39
illiquidity of locking up their money
00:30:41
until retirement age. And I have some
00:30:43
some articles that I I break down that
00:30:45
math. And now that Felicia and her
00:30:47
family have have some assets, they
00:30:49
should certainly revisit their estate
00:30:50
plan if they had one in the first place.
00:30:52
Talking with an estate planning
00:30:53
attorney, a CFP, financial planner,
00:30:55
great places to start on that front. And
00:30:57
then last, I think it's important to
00:30:58
point out, you know, Felicia seems to be
00:31:00
doing a pretty good job of doing her
00:31:02
homework, of right, of of figuring out,
00:31:04
of taking her time, of putting a plan
00:31:06
together, of asking for help, especially
00:31:08
with such large sums of money involved.
00:31:10
You don't want to rush into these kind
00:31:12
of decisions. You also, in my opinion,
00:31:14
don't want to delay too long. You need
00:31:15
to take your time. You need to do your
00:31:17
research, but then you need to execute a
00:31:19
plan. And I think Felicia is doing a
00:31:21
great job there, too. Here's a quick ad,
00:31:23
and then we'll get back to the show. Did
00:31:25
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00:31:27
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00:31:30
Personal Finance Blog of the Year, and
00:31:31
it's been highlighted in the Wall Street
00:31:33
Journal, Yahoo Finance, and on CNBC. I
00:31:36
love writing, especially when that
00:31:38
writing is to share financial education,
00:31:40
and I usually write one or two articles
00:31:42
per week. You can read them all at
00:31:45
bestinterest.blog.
00:31:47
Again, the web address is
00:31:48
bestinterest.blog.
00:31:51
Check it out. But now without further
00:31:53
ado, I want to welcome Kellen Klein here
00:31:55
onto the show. Again, Kellen's the
00:31:56
co-founder of The Savvy Couple, a very
00:31:58
successful online personal finance
00:32:00
brand. But today I I really want to
00:32:02
focus with Kellen on some of the
00:32:04
interesting decisions, choices, plans,
00:32:06
successes, and failures that went into
00:32:09
not only starting his business, but
00:32:11
eventually leaving his old career
00:32:13
entirely, going, you know, like like
00:32:15
Hernand Cortez, uh when he landed in
00:32:17
Mexico, despite all the terrible things
00:32:18
he did, burning the boats behind him and
00:32:21
just going whole hog into into this new
00:32:23
venture. So, I think we have a lot of
00:32:25
exciting and interesting things to learn
00:32:26
from Kellen.
00:32:28
[Music]
00:32:32
Kellen, thank you for being here today.
00:32:34
And as I explained in your little bio
00:32:37
read just now, I mean, you've got a a
00:32:39
really cool business that you started
00:32:41
from scratch. And part of your business
00:32:43
model is helping others kind of pursue
00:32:45
some similar things in their own lives.
00:32:47
So, I'd love to start with this kind of
00:32:48
big question, which is, how do you think
00:32:51
that entrepreneurship, running your own
00:32:52
business, can fit into someone's
00:32:55
long-term wealth strategy?
00:32:57
>> Great question. Thanks for having me on
00:32:58
the show, Jesse. Excited to talk money,
00:33:00
personal finance, financial freedom.
00:33:01
This is right up my alley. So, yeah, I
00:33:03
think just starting side hustles. I
00:33:05
think my wife and I kind of realized
00:33:07
with our nineto-ives is kind of dead
00:33:09
end. We were going to be able to kind of
00:33:10
get that 3% raise every year, but we
00:33:12
really wanted to make sure that we were
00:33:14
living the life that we wanted to. And
00:33:16
the way to do that is to use leverage
00:33:17
and get as much income coming in as
00:33:19
possible to cover our expenses, but not
00:33:21
only cover our expenses, but have enough
00:33:23
that we can invest in the future, start
00:33:25
early and often, and uh and really kind
00:33:27
of just scale that gap between our
00:33:29
living expenses and what we're taking in
00:33:31
each month. So, we're all about creating
00:33:33
as many additional income streams as
00:33:35
possible and and and increasing income
00:33:37
as much as possible as well.
00:33:38
>> You used a couple words there. One was
00:33:39
leverage and one was scale. What do
00:33:42
those words specifically mean to you in
00:33:44
in this entrepreneurial uh lens?
00:33:46
>> So, with a 9to-5, and I'm sure a lot of
00:33:49
your listeners have nineto- fives,
00:33:50
you're kind of limited on your scale
00:33:52
because you're trading your time for
00:33:53
money, whether it's a salary or an
00:33:54
hourly job. That's kind of what you're
00:33:56
going to make. Where as in business,
00:33:58
it's really unlimited depending on the
00:34:00
type of business you run because you can
00:34:01
leverage other people's time, you can
00:34:02
leverage tools, you can leverage pricing
00:34:04
models, reoccurring revenue, all sorts
00:34:06
of different things. So the nice thing
00:34:08
about you know trying to reach financial
00:34:10
freedom quickly which was our goal is
00:34:12
that you can you know when you break
00:34:13
free from the 9 to5 and really get into
00:34:15
this world of entrepreneurship you see
00:34:17
all the possibilities out there and you
00:34:19
get to use that leverage and that
00:34:21
leverage helps you scale your hourly
00:34:23
rate to a spot you know we were able to
00:34:25
scale it like way higher than we ever
00:34:27
thought was even possible in our
00:34:28
lifetime and really use that leverage to
00:34:30
scale our income and scale our freedom.
00:34:32
>> I mean you you offered before we started
00:34:34
recording you offered that you'd be
00:34:36
willing to share some numbers. I mean,
00:34:37
let's talk about that hourly rate or
00:34:39
just that power of scale and leverage a
00:34:40
little bit. I mean, do you mind sharing
00:34:42
absolutely
00:34:42
>> over what kind of timeline you guys have
00:34:44
been doing this and then where you were
00:34:46
before you started and and where you are
00:34:49
now?
00:34:49
>> Sure. So, I'll give a quick background.
00:34:50
I was a jail deputy before we started
00:34:52
being entrepreneurs. Um, I I kind of did
00:34:55
online business and drop shipping and
00:34:58
just selling stuff on eBay all the time
00:34:59
when I was growing up. So, I always had
00:35:01
the the H for entrepreneurship. went to
00:35:02
school for business and finance and uh
00:35:05
anyways got into to the jail deputy role
00:35:07
and really kind of fell into a deep
00:35:08
depression and and realized I need to do
00:35:10
something more out of life. I need to be
00:35:11
in control of my time. I I really value
00:35:13
my time like crazy. So from there I was
00:35:15
making like 26 an hour. I think I could
00:35:17
have topped out near 100k, you know, you
00:35:19
know, six figure job, but this would
00:35:21
have been, you know, 25 years in the
00:35:23
jail and it would have been miserable.
00:35:25
And I saw the writing on the wall with
00:35:26
law enforcement. My my goal is to get to
00:35:28
road patrol and I didn't want to do that
00:35:29
either because I wanted to be home with
00:35:31
my family on nights and weekends and
00:35:32
holidays and not miss things and not
00:35:34
have that stress of that that job. So, I
00:35:37
went from 26 an hour down to 13 an hour
00:35:39
working as an office manager at Robert's
00:35:41
Westland Christian College near us. And
00:35:44
uh kind of reinvented myself and found
00:35:45
my identity again. And and then we
00:35:47
launched our blog, the the Savvy Couple
00:35:49
in 2016. And I worked for basically 9
00:35:53
months not making any money. And I feel
00:35:55
like a lot of entrepreneurs are willing
00:35:57
to do that. They're willing to lose
00:35:58
money and work for free for an extended
00:36:00
period of time because they know long
00:36:02
term it's going to pay off. I'm sure
00:36:03
same thing with with your podcast here.
00:36:05
So took a huge dip and was making, you
00:36:08
know, next to nothing and and realizing
00:36:10
I'm going to start this business. We're
00:36:11
going to figure it out. I'm going to
00:36:12
leverage, you know, my skill set and
00:36:13
continue to de develop that. So anyways,
00:36:16
the ninth month I made $50 online. It
00:36:18
was a light bulb that went off and I I
00:36:19
went to Britney 2 weeks later and said,
00:36:21
"Brett, this is my chance. I can make it
00:36:23
happen. Let me quit." And I wasn't
00:36:24
making much at the time anyways. So
00:36:26
she's like, "Sure, please. I I'm tired
00:36:27
of you complaining about jobs." I quit
00:36:29
my job pretty quickly after that and
00:36:31
then went full-time into freelancing and
00:36:33
and running the business and scaled it.
00:36:35
The first year I think we made 50,000.
00:36:38
The second year we made mult or we made
00:36:41
six figures and then the the following
00:36:42
year we made multiple six figures and
00:36:45
then my wife quit her job as a teacher
00:36:47
to join me full-time. continue to really
00:36:50
develop the business and develop the
00:36:52
blog and develop the traffic and the
00:36:54
skill set and continue to invest in
00:36:56
ourselves, which I think is the best
00:36:58
investment you can have in investing in
00:36:59
your own self because it really helps
00:37:01
you scale your income and and just your
00:37:03
ability to multiply your income through
00:37:05
investing. But anyways, to get to the
00:37:07
numbers, I currently in our business
00:37:09
make over $1,000 an hour, which is
00:37:11
insane. I I really don't work too many
00:37:13
hours a day. Uh, I try to stick to like
00:37:16
a 4-hour window and I do really
00:37:18
productive, really high quality, high
00:37:21
EHR task, which is effective hourly
00:37:23
rate, and really focus on CEO stuff and
00:37:25
let our team kind of do the rest. And
00:37:27
it's been mind-blowing.
00:37:28
>> It's a pretty pretty long journey from
00:37:30
$13 an hour at Robert's Wesley in
00:37:33
college. But it is something I was
00:37:34
thinking and one of the questions I sent
00:37:36
to you beforehand is is you hear the
00:37:37
story, especially now that we're kind of
00:37:40
midway through the story. I'm not going
00:37:41
to say you're at the end of the story,
00:37:42
but you're midway through the story and
00:37:44
it is emotionally tempting to be like,
00:37:46
"Oh, I want to do exactly that." And
00:37:48
when you found yourself working in the
00:37:49
was it the county jail, the city jail,
00:37:51
it was probably emotionally tempting to
00:37:53
be like, "I just want to get out of
00:37:54
here."
00:37:55
>> But how can a listener right now who
00:37:57
maybe wants to escape the 9 to5 or they
00:37:59
just like the idea of entrepreneurship,
00:38:01
how can they realistically start to
00:38:03
evaluate whether it's financially smart
00:38:05
or not for them to follow your path? So
00:38:08
yeah, a lot of times, like you said, I'm
00:38:09
so glad you asked this question. A lot
00:38:11
of times people hear these stories and
00:38:12
be like, "Oh, I'm going to do it." And
00:38:13
then it's like they don't have any plan
00:38:14
in place. They haven't gotten their
00:38:15
finances in order. They don't even talk
00:38:17
to their spouse and get them on board,
00:38:18
which is probably the most important
00:38:19
thing. So, first off, get excited, get
00:38:22
motivated, get inspired, but also slow
00:38:24
down and let's create a plan. So, the
00:38:26
thing that we did was we sat at a dinner
00:38:28
table, and I remember it so vividly cuz
00:38:29
it was probably the most life-changing
00:38:31
conversation we ever had in our
00:38:32
marriage. And I was like, "Brett, this
00:38:34
is not working." Like we had this plan
00:38:35
that I was going to be a police officer,
00:38:37
you're going to be a teacher. We were
00:38:38
going to have, you know, summers off and
00:38:39
travel with our family together. I'm
00:38:41
miserable right now. Miserable. I need I
00:38:43
need a change. So, how do we figure out
00:38:45
how to get more freedom in our life?
00:38:47
And, you know, number one was figuring
00:38:49
out what our vision look like together.
00:38:51
So, how much money do we do we need to
00:38:53
be making? Does it need to be passive?
00:38:55
How much cash flow needs to come in?
00:38:56
What do our expenses look like? How much
00:38:59
debt do we still have? We still had
00:39:00
student loan debt. So basically got
00:39:02
everything on the table and kind of
00:39:03
created our dream life together and and
00:39:06
really, you know, put it on pen to
00:39:07
paper. And it was huge to be able to
00:39:08
visual visually see that together. And
00:39:11
then we really dove into the budget.
00:39:13
Where are we spending our money that we
00:39:15
don't need to be? It's kind of wasting
00:39:16
our hard-earned money, especially if I'm
00:39:17
trying to quit. I want to, you know,
00:39:19
have our budget absolutely dialed bare
00:39:20
minimum. And we suffered for at least 6
00:39:23
months like really trying to save and
00:39:24
pay off debt and just get a big nest egg
00:39:27
for me to quit my job. So for about 6
00:39:29
months there was no eating out. There
00:39:31
was no going out to the bar. There was,
00:39:33
you know, no going out to entertainment,
00:39:35
anything like this. And we were in our
00:39:36
20s, no kids. So we were just like,
00:39:38
we're going to grind it out for 6
00:39:39
months. Pay off as much debt as
00:39:40
possible. Grow this nest egg of I think
00:39:42
we had like 40 or 50,000 at the time,
00:39:45
which is a really good nest egg for us.
00:39:47
And you know, let me do this
00:39:49
entrepreneur thing, entrepreneurship
00:39:50
thing for a full year. And that gave us
00:39:52
kind of the window and the runway where
00:39:54
I could dive into it full-time and not
00:39:56
be worried about finances. You know, we
00:39:57
were living off Britney's teacher salary
00:39:59
at the time. So, we really took our
00:40:01
budget down to one income, which was
00:40:02
awesome. It allowed me to have the
00:40:04
freedom to explore different things and
00:40:06
make good sound financial decisions and,
00:40:09
you know, decisions with investing in
00:40:11
the business and where to scale and
00:40:12
where to, you know, focus my time and
00:40:14
energy and not be so wrapped up in, oh
00:40:15
my gosh, I got to make money right now.
00:40:17
It kind of gave me that that freedom.
00:40:18
But yeah, align with your marriage, get
00:40:20
a vision together, master your money,
00:40:21
and get it, you know, your bare bones
00:40:23
budget. And then instead of just jumping
00:40:26
into it full-time and being like, "Hey,
00:40:27
I'm quitting my job. I hate it."
00:40:29
Sometimes that's necessary if you're
00:40:30
like really struggling. Like sometimes
00:40:32
quitting your job is a must just for
00:40:34
mental health. But there's always other
00:40:36
opportunities. I think the biggest thing
00:40:38
is create the side hustle first. Like
00:40:40
spend the extra time instead of Netflix
00:40:42
every night. You know, 4 hours of
00:40:43
binging Netflix. like prove the concept
00:40:46
whether it's an online business or
00:40:47
you're you know you're starting a
00:40:48
pressure washing business you know one
00:40:49
of those boring businesses that cash
00:40:51
flow really well whatever it may be like
00:40:52
start it and prove that you can make
00:40:54
some money with it and then scale it to
00:40:55
the point where hey if I actually put
00:40:58
all my time and effort into this could
00:40:59
far outseed how much I'm making at my
00:41:01
job and then that's the time you kind of
00:41:02
jump safely or you can do it like me and
00:41:05
do it after you made 50 bucks. I I get
00:41:07
from your point of view, you almost kind
00:41:08
of like burned the ships as they say,
00:41:10
right? Like there's no going back. I I
00:41:12
suppose you always could have decided to
00:41:14
stop and go back, but when you quit your
00:41:15
job and committed fully to this, you
00:41:18
really decided to not go back. But yeah,
00:41:20
that whole proof of concept thing, I
00:41:22
think, is really big. At the same time
00:41:24
though, there's this, you know, if you
00:41:26
go down the proof of concept path,
00:41:28
you're kind of leaving yourself a little
00:41:29
wiggle room to to back out and make an
00:41:31
excuse for yourself. So, I don't know.
00:41:33
Do you have any tips or tricks when it
00:41:34
comes to like, okay, maybe you don't
00:41:36
want to take the huge risk of quitting
00:41:38
your job right away, but at the same
00:41:40
time, if you're going to do this proof
00:41:41
of concept, you still want to make sure
00:41:43
you do it well and you focus on the way
00:41:45
that it can actually work out for you in
00:41:46
the long run, and you want to prevent
00:41:48
your own ability to make excuses and
00:41:50
quit early. So, I mean, any thoughts on
00:41:51
on that front?
00:41:52
>> Yeah. Yeah, I think everyone's
00:41:53
different. I was at the point where I
00:41:55
was six six jobs in after college and
00:41:57
like every single one I came to this
00:41:58
conclusion of like this is not for me. I
00:42:00
have to do something on my own. Plus,
00:42:02
I'm pretty, we can talk about it. I'm
00:42:04
very riskaverse. Like, I realize we have
00:42:05
one life and I am going all in on
00:42:07
things. And like, if it works, great. If
00:42:09
not, I'll, you know, collect the pieces
00:42:10
and build something else. I think it's
00:42:12
important to kind of lean into your
00:42:14
personality and and yeah, go with what
00:42:16
feels comfortable with you. And but
00:42:18
yeah, I think it's it is important to
00:42:21
potentially have a plan B in place. The
00:42:23
the the worst thing you want to do is
00:42:24
like go all in on something, it doesn't
00:42:26
work, and then you're homeless. Like,
00:42:27
make sure you can keep food on the table
00:42:29
and a house over your head and then
00:42:30
you're in good shape. Well, let's talk
00:42:32
about that risk aversion then because I
00:42:33
on the one hand absolutely the idea of
00:42:36
quitting your job after making 50 bucks
00:42:39
online sounds like a huge risk. It is a
00:42:41
huge risk. It was a huge risk. But at
00:42:43
the same time, you and Britney, right,
00:42:45
you you set aside this emergency fund.
00:42:47
You planned out your monthly expenses.
00:42:48
You built a safety net into this plan
00:42:50
that certainly derisked you. So, what
00:42:53
are your thoughts just in general? I
00:42:55
mean, owning your own business is such a
00:42:58
big risk. So what are your thoughts
00:42:59
about risk in the business place in
00:43:01
entrepreneurship? How to take these big
00:43:03
swings in the world of entrepreneurship
00:43:05
while maybe maintaining some level of
00:43:07
conservatism overall in your in your
00:43:09
finances.
00:43:10
>> It's important to have kind of a
00:43:12
blueprint. And looking back, we our
00:43:15
timing, we were really blessed with the
00:43:16
timing of all this. You know, we had no
00:43:18
kids, which I can't imagine, you know,
00:43:20
starting a business with a full-time job
00:43:21
with kids. It's going to be that'd be
00:43:23
really hard. We have a lot of people
00:43:24
that follow us that do that. But, you
00:43:26
know, we had it super easy because we
00:43:28
could put all of our time and effort
00:43:29
into that without kids. And then, you
00:43:31
know, my wife just got her teaching job,
00:43:33
so she was getting paid pretty well. We
00:43:34
had good health insurance. Like, the
00:43:36
timing of it was absolutely perfect. So,
00:43:37
I think entrepreneurship, there's a lot
00:43:38
to say about timing. You know, realizing
00:43:40
patterns and jumping on them when they
00:43:42
arise. We derisked as much as possible
00:43:44
by having, you know, our barebone
00:43:46
budget. And we knew my wife's salary
00:43:48
could cover our living expenses. So,
00:43:50
we're not going to lose the house. We're
00:43:52
going to always have food on the table.
00:43:53
And worst case, I have to get another
00:43:55
job that I hate. And then I do that for
00:43:56
6 months and try something else. It
00:43:58
really comes down to money.
00:43:59
Unfortunately, money makes the world go
00:44:01
around and money is the tool that gives
00:44:03
you the freedom and gives you food on
00:44:04
your table and a roof over your head and
00:44:05
a car to a drive-in. So, it's really
00:44:08
being able to master your money and, you
00:44:10
know, know to the dollar on a budget
00:44:12
where things are going and how much
00:44:14
money you need coming in. And once you
00:44:16
can understand that and you can control
00:44:18
your spending and your investing with
00:44:20
kind of discipline, um the rest becomes
00:44:22
really easy. If you want to use leverage
00:44:24
and get in entrepreneurship, you know,
00:44:26
you got to take risks to earn more money
00:44:28
and and leverage and increas your
00:44:30
income. But a lot of times
00:44:32
entrepreneurship is not for everyone. I
00:44:34
used to have the mindset that like, oh
00:44:35
my gosh, anyone can do entrepreneurship.
00:44:36
Like I don't know why all my friends
00:44:37
aren't doing it. Like there's so many
00:44:39
people around me that I see have skills
00:44:41
that could monetize them and and impact
00:44:42
the world. But a lot of times I'd say
00:44:45
I'm a big proponent of 8020 rule. I
00:44:47
think like 20% of people are really
00:44:49
meant to be entrepreneurs and 80% love
00:44:51
the security of a 9 to5 and that's
00:44:53
totally fine. I know so many friends
00:44:55
that love their job and they get a ton
00:44:57
of fulfillment from it and it provides
00:44:58
for their family and there's nothing
00:44:59
wrong with that and they invest their
00:45:01
money smartly and they're going to
00:45:02
retire and have an awesome retirement.
00:45:04
But you know the people that that's not
00:45:06
for like myself that needs to have more
00:45:08
control and more time freedom to kind of
00:45:09
set my own schedule and and spend time
00:45:11
with the family, it's definitely worth
00:45:12
pursuing.
00:45:14
>> Going back to the topic of risk and
00:45:15
spending a little bit more. So, now that
00:45:17
you're on the again, you're in the
00:45:19
middle of your story, I'm saying, and as
00:45:21
you said, you said your your effective
00:45:22
hourly rate is is literally in the four
00:45:24
figures, $1,000 an hour plus. So, my two
00:45:27
questions for you are one, have you
00:45:29
loosened the purse strings on the budget
00:45:30
a little bit since when you started? And
00:45:32
then two, in order to build more
00:45:34
conservatism into your family, into your
00:45:37
personal financial plan, do you find
00:45:38
yourself taking some of that very large
00:45:41
income that you're receiving and
00:45:42
diverting it into some sort of
00:45:44
diversified way or just into some sort
00:45:46
of conservative backs stop to make sure
00:45:48
that you know even if the business, you
00:45:50
know, sputters from here, you don't have
00:45:52
to go back to being a prison guard.
00:45:54
>> Yes, the purse strings have definitely
00:45:56
uh increased. It was I'm not sure if
00:45:58
it's having kid I mean, you have a child
00:46:00
as well. Yeah,
00:46:01
>> kids for some reason make you spend a
00:46:03
lot of money. They're not cheap. We
00:46:05
definitely uh have seen our budget from
00:46:07
when we first got married till now. Uh
00:46:10
probably 2x at least, just a bigger
00:46:12
house, nicer cars, but we still live a
00:46:14
very normal millionaire next door
00:46:16
lifestyle. Like we are not flashy in any
00:46:18
way. We don't have Lambos or anything
00:46:19
like that. That's not what we're about.
00:46:20
We're about time freedom and spending
00:46:23
time on the family and spending as much
00:46:24
time together, quality time together.
00:46:26
So, but yeah, as far as like eating out,
00:46:28
we definitely eat out more than we used
00:46:30
to. I love the ability to not really
00:46:31
look at pricing. If I want a steak, I'm
00:46:33
gonna get a nice stake. That's just kind
00:46:34
of the luxury of making more money. And
00:46:36
we still have a budget that we stick to.
00:46:38
We This was actually Mint closed down
00:46:41
what, two years ago now?
00:46:42
>> Yeah, about that. Yeah, a year and a
00:46:43
half.
00:46:44
>> Yeah. We were huge, huge users of Mint.
00:46:46
Like loved them, used them from when we
00:46:48
were in college up till, you know,
00:46:50
living together and and getting married.
00:46:52
They closed down. I was like, let's, you
00:46:53
know, we're making really good money.
00:46:54
Let's try not budgeting and see how that
00:46:56
works. And for 6 months, we did that.
00:46:59
And I just kept looking at the credit
00:47:01
card statements going up up up and I was
00:47:02
like, "Wait a second. We need we this is
00:47:04
ridiculous." Like our name is literally
00:47:06
the savvy cop. We need to get back on a
00:47:08
budget here and live the the life we're
00:47:09
preaching here. So we reign things way
00:47:11
back in. And just getting on a budget, I
00:47:13
think we were we took our spending down
00:47:15
like $3,000 a month, which is like wild
00:47:18
and not too surprising, honestly.
00:47:19
Without a budget, you know, your
00:47:21
spending goes crazy. So yes, the purse
00:47:23
strings have definitely uh opened up,
00:47:25
but we're definitely still smart with
00:47:27
our money and and make sure that we're
00:47:28
spending it in the areas that bring us
00:47:30
the most happiness and joy in our life.
00:47:31
And then as far as uh you talked about
00:47:33
diversification,
00:47:35
>> yeah, diversification or conservatism or
00:47:37
just building some cushion into your
00:47:38
life.
00:47:39
>> We started the blog in 2016 and it kind
00:47:41
of peaked about 2 years ago.
00:47:43
Unfortunately, you know, with AI and
00:47:45
Google updates, our traffic has gotten
00:47:47
hit quite a bit. So we've been kind of
00:47:49
pivoting since then. We started uh
00:47:51
investing in real estate last year,
00:47:53
taking the cash flow and the extra
00:47:54
income that we had with our two online
00:47:57
brands and you know obviously we're
00:47:59
maxing out our Roth IAS every year.
00:48:01
We're putting money into our SEP to
00:48:02
continue to grow that as well. But on
00:48:04
top of that, any income that we had, we
00:48:06
were putting towards real estate. So we
00:48:07
found a partner that used to work at the
00:48:09
jail with me who's actually our class
00:48:10
captain and went through the academy
00:48:12
with me. He became a real estate agent
00:48:14
and was crushing it. And we went to a
00:48:15
conference together, you know, invested
00:48:17
in our own skill set and learned more
00:48:19
about real estate and got comfortable
00:48:20
with what a partnership would look like.
00:48:22
And we actually today, earlier at like
00:48:24
two or three or I'm sorry, it's three
00:48:26
now. Earlier today, we closed on our
00:48:27
seventh long-term rental together. Super
00:48:29
diversified. We're definitely, you know,
00:48:31
got tons of money in the stock market
00:48:33
and we got a rental portfolio that's
00:48:35
cash flowing really well and we're
00:48:36
getting all the benefits of real estate.
00:48:38
So, and then on top of that, we're
00:48:39
pivoting, going all in on AI with all of
00:48:41
our online businesses to continue to
00:48:44
find growth.
00:48:45
>> That's awesome. That's awesome. Staying
00:48:46
on the cutting edge. And speaking of
00:48:47
that, just speaking of kind of always
00:48:50
looking for the best use of your time or
00:48:52
the best use of your capital. Here's a
00:48:55
quick ad and then we'll get back to the
00:48:56
show. I love getting your questions and
00:48:58
some of you ask me questions about the
00:49:00
wealth management firm I work for in
00:49:01
Rochester, New York. Others ask about
00:49:03
the best interest blog and this podcast,
00:49:05
Personal Finance for Long-Term
00:49:06
Investors, which operate without
00:49:07
advertising, without pushy sales, and
00:49:09
with no pay walls. How can the blog and
00:49:11
podcast stay afloat without me dumping
00:49:13
my own money into it? Well, to answer
00:49:15
both those questions, I want to point
00:49:16
you to episode 78 of Personal Finance
00:49:18
for Long-Term Investors. I intentionally
00:49:20
recorded episode 78 to shine light on
00:49:22
those topics and inform you how you are
00:49:24
actually helping and can continue
00:49:26
helping these projects carry forward.
00:49:28
So, if you've ever been curious about
00:49:29
the business of my blog and podcast, or
00:49:31
if you're curious about my day job in
00:49:33
wealth management, please check out
00:49:34
episode 78 and let me know what you
00:49:36
think. Kind of pivoting back to the
00:49:38
whole side hustle entrepreneurship, have
00:49:39
you found that certain side hustles,
00:49:41
certain small businesses tend to have a
00:49:43
better return on an investment, whether
00:49:45
it's financial or time-wise? Again,
00:49:47
thinking back to our listeners who might
00:49:49
have limited bandwidth and they only
00:49:50
have time to pick one thing right now.
00:49:52
Is there some places that are just
00:49:54
better uses of your time than others?
00:49:56
>> Certainly. I I think, you know,
00:49:58
especially if you have limited time, you
00:50:00
know, you're married, you have a
00:50:01
full-time job, you have kids, I think
00:50:03
it's really important to look at stuff
00:50:06
that has an high a high earnings per
00:50:08
hour or something that you can scale.
00:50:10
So, you know, take for example Uber Eats
00:50:12
or Door Dash. Those are like your F tier
00:50:16
side hustles that, you know, you're
00:50:17
putting wear and tear on the car, you're
00:50:18
paying for gas, you're paying for
00:50:20
insurance, and you're making at the end
00:50:21
of the day maybe 10 bucks an hour. Plus,
00:50:23
you have to drive out there. So there's
00:50:25
time that you're not getting paid. So
00:50:27
we've always been big proponents of
00:50:29
online side hustles. And the ability to
00:50:32
put the kids to bed, hop on a computer
00:50:34
for 2 hours, and make money or at least
00:50:36
learn the skills to make the money
00:50:37
because online is open 24/7. So with the
00:50:41
right systems and the right traffic
00:50:42
coming in, you can make money 24/7, 365.
00:50:44
So whether you're on vacation, sleeping,
00:50:46
whatever it may be, you're not putting
00:50:47
wear and tear in your car. It's super
00:50:49
flexible. You can work anywhere you
00:50:50
want. You can even I mean don't say I
00:50:52
said this, but you can even do some at
00:50:54
work if you have like an extra lunch
00:50:55
break or you know you're doing a little
00:50:57
multitasking, you get a little work in
00:50:58
on your side hustle. I definitely did
00:51:00
that. Hopefully Ryan doesn't hear this.
00:51:01
I'm sure he knows. He's my old boss. But
00:51:04
yeah, online income is definitely the
00:51:07
one that we always promote. And what
00:51:09
does that look like? We're big
00:51:10
proponents of affiliate marketing. So,
00:51:12
if someone's trying to get into making
00:51:13
money online, the easiest by far way to
00:51:15
make money online, especially with cell
00:51:17
phones now and Tik Tok and all that
00:51:18
stuff is just affiliate marketing. So,
00:51:21
you're basically promoting and selling a
00:51:23
product that you don't even own and you
00:51:25
just send people to a link. So, you
00:51:26
create value, get them interested. Maybe
00:51:29
it's a product on TikTok or a program
00:51:30
that you purchased about AI and you
00:51:33
learned a lot from it and then you're
00:51:34
going to promote it to others because
00:51:35
you got a lot of value in it. And then
00:51:37
you get a kickback, a commission. And
00:51:39
it's super easy because there's no
00:51:40
fulfillment. You're not, you know,
00:51:41
returning orders. You're not uh handling
00:51:43
customer service. You're literally just
00:51:45
creating content and getting a kickback
00:51:46
with commission. So, it's sales and
00:51:48
marketing, which is super leverable.
00:51:49
>> So, let's dive in a little bit more into
00:51:51
this online world because it's really
00:51:52
it's the world of your and Britney's
00:51:54
expertise. I could see a listener
00:51:56
sitting there right now cuz I certainly
00:51:58
felt this way 6 years ago when I was
00:52:00
like, "Well, man, the internet is
00:52:01
already saturated. There's so many
00:52:03
creators. There are so many websites.
00:52:05
How am I going to break into this
00:52:07
space?" And personally, at least one
00:52:10
thing I think to myself is this term,
00:52:11
you know, there's riches in the niches.
00:52:13
And every time out there I see someone
00:52:15
who their brand is, you know, I talk
00:52:18
about personal finance for attorneys
00:52:20
under the age of 30 who are still in law
00:52:22
school debt. I'm like, "Oh, that's a
00:52:24
really nice niche cuz you're you're
00:52:25
speaking to a very specific audience."
00:52:27
But then again, I mean, you're the
00:52:29
expert here. So, I'm curious to hear if
00:52:31
you're breaking into this world in 2025,
00:52:34
where do you start and where do you
00:52:35
focus?
00:52:36
>> Yeah, it's true. the riches are in the
00:52:37
niches. That's something we've always
00:52:39
struggled with. I don't know if it's my
00:52:40
ADHD and wanting to like solve all
00:52:42
problems and like just capture everyone
00:52:44
and not have that limiting mindset of
00:52:46
like I can only serve this person, but
00:52:48
when you can serve that individual way
00:52:50
better than serving everyone, that's
00:52:51
when you're going to make way more
00:52:52
money. But to answer your question, I
00:52:54
really love there's like it's a ven
00:52:56
diagram. It's got three different
00:52:57
quadrants. One of them is the skills
00:52:59
that you already have. So what skills
00:53:00
from work do you have, books that you've
00:53:02
read, whatever experience, education?
00:53:05
What skills do you already have? What
00:53:06
are you passionate about? Whether it's
00:53:08
personal finance, fitness,
00:53:09
relationships, those are kind of the top
00:53:10
three niches that people are going to
00:53:12
make money from. And then what are you
00:53:14
already good at? So, what like comes
00:53:16
natural to you? And for us, you know, we
00:53:18
kind of did that ven diagram and the
00:53:20
middle led to personal finance. So, we
00:53:21
originally started just teaching people
00:53:24
how to be savvy with their money, be
00:53:25
really frugal with their budget, save,
00:53:27
invest, and then it kind of switched to,
00:53:30
wow, we I actually been making money
00:53:32
online since I was 13 years old. Like, I
00:53:33
know this stuff. I know marketing. I
00:53:35
know sales. I know how to create content
00:53:37
on a blog post that will kind of
00:53:38
convert. So, we switched to like let's
00:53:41
teach people how to make more money. Cuz
00:53:42
we realized in our life, it's great to
00:53:44
invest. It's great to save money, but
00:53:46
you can only save so much and then your
00:53:48
life becomes miserable. And we got to
00:53:49
that point a couple times in our kind of
00:53:51
debt payoff journey. But we also
00:53:53
realized saving money is great and you
00:53:55
want to do that and you want to be
00:53:56
disciplined with your budget. But if you
00:53:57
can increase your income and have an
00:53:59
extra th000, 2,000, $5,000 per month
00:54:01
coming in, like that is monumental
00:54:03
compared to trying to save in your
00:54:05
budget. So developing those skills and
00:54:06
and making money off of those on kind of
00:54:08
those three quadrants and figuring out
00:54:09
what niche to get into and then just get
00:54:12
out your phone and start making content.
00:54:14
And an easy kind of another thing to do
00:54:17
after you've kind of pick your niche is,
00:54:19
all right, what problems does that
00:54:20
avatar have? So I'm going to pick a
00:54:22
>> Yeah, when you say avatar, explain that.
00:54:24
I mean, I know exactly what you mean.
00:54:25
What does that what does that mean? So,
00:54:26
it's your ideal customer, ideal viewer
00:54:29
that's going to be viewing your content.
00:54:31
So, we'll pick like a niche of like
00:54:33
30-year-old married men that have, you
00:54:36
know, a newborn that are trying to stay
00:54:38
in shape, you know, super niched. And
00:54:40
there's a lot of them that just they put
00:54:43
on just as much weight as their wife
00:54:44
during marriage. I was one of them. I
00:54:45
like I don't know why I stress eat, too.
00:54:47
Figuring out ways to all right, what
00:54:49
problems do they have? Okay, they need
00:54:50
to learn how to track their calories.
00:54:52
Maybe they don't h know how to get in
00:54:54
the gym or they're not self-con they're
00:54:55
too self-conscious to get in the gym.
00:54:56
They don't have a workout routine. Maybe
00:54:58
they think that it's going to take too
00:54:59
much time. You know, list out all their
00:55:02
problems and then go to Chad GBT and
00:55:05
literally say, "Okay, create me an A2B
00:55:07
map to transform this person's life and
00:55:09
give me 20 different Instagram reels
00:55:11
that I can create." And then bingo,
00:55:12
you're already off to the races. And
00:55:13
then you're just you're literally
00:55:15
recording stuff that you already know
00:55:16
about and you're an expert in.
00:55:17
>> I I love that idea. I think about that
00:55:19
and I'll I'll open up the hood to
00:55:21
listeners. I mean, I think about the
00:55:23
people who I want to speak to. I think
00:55:25
about the problems that they're facing.
00:55:26
I think about people who I work with as
00:55:28
clients at work. And in my mind, I have
00:55:30
these avatars or ideal client profiles
00:55:32
that kind of there's a few different
00:55:34
buckets of of people who I tend to help.
00:55:36
And there's a reason why I tend to focus
00:55:38
my content on some of the more complex
00:55:40
ideas. I tend to focus my content maybe
00:55:42
on more retirement focused ideas. I find
00:55:44
those interesting. It's that ven diagram
00:55:46
that you were talking about, Kellen.
00:55:47
Yeah. I find it interesting. It's
00:55:48
intellectually stimulating. I'm good at
00:55:50
explaining these ideas. It helps me at
00:55:52
work. It helps me produce content, etc.,
00:55:54
etc., etc. And then whenever I'm
00:55:56
struggling for content ideas, I just
00:55:58
think back to like, well, what are the
00:55:59
problems that my listeners are facing?
00:56:02
There's a reason listeners why I ask you
00:56:03
guys for AMA episodes. I mean, these
00:56:05
episodes, they're great. They're so much
00:56:06
fun to put together, and it's nothing
00:56:08
but problems that you guys are telling
00:56:10
me you're facing. And then boom, here
00:56:12
are the answers. So, it's just this
00:56:14
really fun and kind of generous flywheel
00:56:17
of content that spins around and around.
00:56:18
But back to you, Kellen. We haven't
00:56:20
talked about it quite yet. You've
00:56:21
alluded to it once or twice, but going
00:56:23
back to the whole niches things. You
00:56:24
started as a savvy couple kind of,
00:56:26
right? This very kind of family focused.
00:56:28
Any family in America could benefit from
00:56:30
that. Well, that's not very niche. But
00:56:32
then I know Britney, your your wife, she
00:56:34
niched down into the savvy mama, which
00:56:36
is a lot more focused on mothers and and
00:56:39
from what I gather, kind of like younger
00:56:40
mothers, right? People, you know. So,
00:56:42
how's that project been?
00:56:43
>> Yeah, it's been good. We kind of took
00:56:45
what we did with the savvy couple with
00:56:47
kind of running a blog and you know
00:56:48
affiliate marketing and we knew the
00:56:50
writing on the wall of like eventually
00:56:51
we're going to lose traffic from Google
00:56:53
from the savvy couple and affiliate
00:56:54
marketing and we need to go more YouTube
00:56:56
and we need to get reoccurring revenue
00:56:58
coming in cuz we don't want to our
00:57:00
businesses to die if the traffic dies.
00:57:02
We started the savvy mama and she helps
00:57:03
moms control the chaos in their life
00:57:05
with meal planning, meal prep,
00:57:07
budgeting, cleaning binders, all this
00:57:08
stuff that kind of gets them organized,
00:57:10
gets them in a good routine and and gets
00:57:12
them to be the CEO of the house. And
00:57:13
then on the back end of that, we had a
00:57:16
salesunnel that was getting a lot of
00:57:17
traffic from the blog and from social
00:57:19
media and paid ads. And then one day we
00:57:21
we hired a a business coach and he was
00:57:24
like, "Well, why don't you guys just put
00:57:25
a membership button on like one upsell
00:57:27
page?" So, you know, you're checking out
00:57:28
and there's like an offer, a one time
00:57:30
offer that pops up. We're like, "Sure,
00:57:31
we'll do that." We turn it on and like
00:57:33
within a week, we had like 15 people
00:57:35
sign up and we were like, "Wait, wait,
00:57:36
wait, wait. Something something. We're
00:57:38
on to something here." So, it's super
00:57:39
low ticket. It's like nine bucks a
00:57:41
month, but she's got like 1,200 members
00:57:42
in it and it's just an awesome
00:57:45
reoccurring revenue and it's super
00:57:46
hands-off for her and you know, the moms
00:57:47
are getting tons of resources to help
00:57:49
them within the house. So, it's been
00:57:50
really good.
00:57:51
>> That's so cool. And yeah, I mean, I can
00:57:53
allude to that. I think I see do you use
00:57:55
Kit as your email provider?
00:57:58
>> I was going to say I I joined Kit a
00:57:59
couple months ago. Kit's got so much
00:58:01
cool functionality. And this might be
00:58:02
too much in the weeds for the average
00:58:04
listener, but all I'll say is it allowed
00:58:06
me to experiment with some things
00:58:08
including some white papers that I put
00:58:10
together like helpful educational white
00:58:11
paper. Download this white paper. It's a
00:58:13
lead magnet. People will end up
00:58:15
subscribed to my email newsletter. And I
00:58:17
saw it kind of click and work and I was
00:58:19
like, okay, I need to refine this and
00:58:20
make it better and better and better and
00:58:22
better. When you see something like that
00:58:24
in your business, kind of on your
00:58:25
entrepreneurial journey, it's such a
00:58:27
unique feeling to like optimize and make
00:58:29
it better and better. Speaking of the
00:58:31
entrepreneurial journey, not everything
00:58:33
goes well. I wanted to ask you whether
00:58:36
it's just the most common mistakes that
00:58:38
you've seen from others or and maybe
00:58:41
this is two separate questions. I'd love
00:58:43
to know something that you and Britney
00:58:45
really thought was going to work up
00:58:47
front or something you thought about
00:58:48
entrepreneurship up front but that now
00:58:50
you've completely changed your mind on.
00:58:52
So take that either direction you want
00:58:53
or both, Kellen, but whether it's
00:58:55
mistakes that you've made or just big
00:58:56
lessons that you've learned along the
00:58:58
way. Yeah, I think the questions go hand
00:58:59
in hand. So, our biggest mistake is we
00:59:02
kind of saw a ton of growth with
00:59:04
blogging and like SEO and we got really
00:59:06
really good at it and had a team and was
00:59:07
using AI and it was really scalable. We
00:59:10
could leverage it quite a bit. So, we at
00:59:12
one point I think had four or five
00:59:14
blogs. Some of them were brand new side
00:59:16
projects and then we kind of condensed
00:59:18
them all into the two. And the problem
00:59:21
that we ran into was just lack of focus.
00:59:25
Like I I was so scatterbrain on like
00:59:27
okay this blog needs this, this blog
00:59:29
needs this, this team needs this, this
00:59:30
system needs to come into play. So I
00:59:32
think the biggest mistake that people
00:59:33
make in entrepreneurship is shiny object
00:59:35
syndrome. A lot of people that start in
00:59:37
entrepreneurship and start a business,
00:59:38
they're very much like me and have ADHD
00:59:41
and they just see all these these cool
00:59:43
things that we can do. you know, when we
00:59:45
really buckled down and just focused on
00:59:47
the savvy couple and that was our one
00:59:48
thing, that's when we saw exponential
00:59:50
growth over time and really saw it blow
00:59:52
up and have that hockey stick kind of
00:59:54
growth. So, I think it's being really
00:59:56
really focused and setting up quarterly
00:59:59
goals where these are the three goals
01:00:00
that we're going after and then break
01:00:02
those down into like a couple KPIs.
01:00:05
you're getting over over people's heads
01:00:06
for probably key performance indicators
01:00:08
and then yeah just breaking it down into
01:00:10
like daily tasks that move the needle
01:00:12
and just staying super hyperfocused on
01:00:14
on those things and not getting
01:00:15
distracted.
01:00:17
>> That's a great tip and that's a great
01:00:18
tip for just people in their financial
01:00:20
plan too. I mean the number of times an
01:00:22
investor now generally we we try to
01:00:24
avoid things like investing in
01:00:26
individual stocks or you know chasing
01:00:27
the hot stock this or that we you know
01:00:29
the long-term investor focuses on other
01:00:31
things but I mean we've all heard the
01:00:33
story those kind of stories from
01:00:34
investing of well I I heard from my
01:00:36
bowling partner that I should be doing
01:00:37
this thing or I I saw a commercial for
01:00:40
this business and I think I should
01:00:41
invest in it and the investor who just
01:00:43
chases the shiny object almost always
01:00:45
ends up worse off for it.
01:00:47
>> I have a story on that. So, I did some
01:00:49
stock trading back in the day with Robin
01:00:51
Hood, did some options trading, and I
01:00:54
I'm a pretty emotional person, kind of
01:00:55
ride my emotions. So, getting into the
01:00:57
weeds and like doing that and seeing the
01:00:59
numbers go up is like exhilarating, but
01:01:01
then seeing it go down is like, oh my
01:01:03
gosh, my life's going to end. So, I've
01:01:05
found and I by the numbers like the
01:01:07
numbers stay say strictly like I should
01:01:10
not I don't do any kind of individual
01:01:12
stocks investment anymore. I do super
01:01:14
broad index funds and set it and forget
01:01:16
it type of investing and in it for the
01:01:18
long haul on companies that I believe in
01:01:20
and it's super diversified. So I I
01:01:22
definitely recommend that approach when
01:01:23
it comes to investing. Obviously, you
01:01:25
want maybe, you know, one to five
01:01:27
percent where you're taking home runs
01:01:28
and on stuff that you truly believe in,
01:01:30
whether it's, you know, Bitcoin or an
01:01:32
individual stock, individual company, a
01:01:34
company you're starting. But overall,
01:01:36
uh, set it and forget it. And boring
01:01:38
investing is the way to go 100%. And and
01:01:40
the numbers show on my Robin Hood
01:01:42
account for sure.
01:01:43
>> Yeah. No, that that is the way to to
01:01:45
build that path towards financial
01:01:47
freedom. And and speaking of building
01:01:49
freedom and freedom builders, I see the
01:01:51
word freedom on your t-shirt and I
01:01:52
wanted to give you a chance. I know you
01:01:54
guys are working on this freedom
01:01:55
builders concept. Can you tell us a
01:01:57
little bit about this, Kellen? And then
01:01:58
just to wrap it up, how can people reach
01:02:00
out to you and and and start following
01:02:02
along?
01:02:02
>> Yeah. So, we're on Instagram pretty
01:02:04
actively. We do daily stories and and
01:02:06
post quite often. It's just the savvy
01:02:08
couple. And yeah, we recently realized
01:02:10
that we don't we've always had people
01:02:12
reaching out like how do we get
01:02:13
one-on-one time with you or coaching
01:02:14
with you? And it's like we don't offer
01:02:15
that. You know, our time's too precious
01:02:17
and and we just don't have the time to
01:02:18
do that. But it's been more and more in
01:02:20
our hearts to kind of create this
01:02:21
community of people that are wanting
01:02:23
more out of life. They're wanting more
01:02:25
than a 9 to5. They're wanting to reach
01:02:26
financial freedom quicker and have a
01:02:28
game plan to do so. So, we are starting
01:02:30
a uh weight list for a community called
01:02:33
Freedom Builders. And it's going to help
01:02:34
married couples basically get aligned
01:02:36
with their or with their vision for
01:02:38
their life and then master their money
01:02:40
and then come up with a blueprint to
01:02:41
create income online and create
01:02:43
additional streams of income whether
01:02:44
that's affiliate marketing using AI with
01:02:47
local businesses, real estate, and we're
01:02:49
going to have weekly coaching and and
01:02:50
just have this awesome community of
01:02:51
freedom builders. So, that's kind of
01:02:53
what we're working on.
01:02:54
>> That's awesome. Can we get a link? We'll
01:02:55
get a link to that and throw it in the
01:02:56
show notes, but how how can people find
01:02:58
it? We're putting together the weight
01:03:00
list now. It's like something brand new.
01:03:01
So yeah, I'll give you the link after
01:03:03
this and and they can click it in the
01:03:04
show notes. It'll most likely be
01:03:06
thesavvy couple.comfreedombuilders
01:03:08
weight list.
01:03:09
>> Awesome. Awesome. We will keep an eye
01:03:11
out for that and include it in the show
01:03:12
notes. Well, hey Kellen Klein of the
01:03:14
savvy couple and more and many different
01:03:16
projects and sidehustles. Thanks for
01:03:17
joining us on Personal Finance for
01:03:19
Long-Term Investors.
01:03:20
>> Thanks so much. Appreciate it.
01:03:21
>> Thanks for tuning in to this episode of
01:03:23
Personal Finance for Long-Term
01:03:25
Investors. If you have a question for
01:03:27
Jesse to answer on a future episode,
01:03:29
send him an email over at his blog, The
01:03:31
Bestin Interest. His email address is
01:03:34
jessevebestinterest.blog.
01:03:36
Again, that's jessevestinterest.blog.
01:03:40
Did you enjoy the show? Subscribe, rate,
01:03:42
and review the podcast wherever you
01:03:44
listen. This helps others find the show
01:03:46
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01:03:49
we really appreciate it. We'll catch you
01:03:51
on the next episode of Personal Finance
01:03:53
for Long-Term Investors. Personal
01:03:55
Finance for Long-Term Investors is a
01:03:57
personal podcast meant for education and
01:03:59
entertainment. It should not be taken as
01:04:02
financial advice and it's not
01:04:03
prescriptive of your financial
01:04:04
situation.
