Let's move on to Eric's question. He says, "How do you guys feel, assuming that your 401k and Roth IRA are maxed out, about stuff like taking expensive and lavish vacations or buying things like boats – the things that are very purely in the want category? How do you guys tackle those? How do you guys feel about them?" Because some people really are like, "Never do this." What do you think?
Here's the way that I feel: money is a tool; it's not a goal. Your goals might be things like, "Hey, I want to own a boat," "Hey, I want to own a luxury car," "Hey, I want to take a lavish vacation." If that's your goal, I'm all for you using your money to do those things. But what you have to do is prioritize your goals. What matters more to you – a lavish vacation or financial independence? If you cannot have both, you've got to decide which one you're going to pursue.
Now, what we love because we think financial independence probably, for most folks, ought to be one of the top high goals up there. There is okay if I'm doing all the things I'm supposed to be doing, if I'm following the
financial order of operations – do you have a thing you can show them, Brent? Oh, yeah. If I'm following the
financial order of operations and I'm saving 25% of my gross income for the future, then so what if I want to go spend my money on luxury clothes or on a boat or on lavish vacations? You have to define what are those things that you love spending money on, and we encourage you to go spend money on those things after you've paid yourself first, after you know that you've checked the boxes you're supposed to check, so that you're not trading future goals for short-term goals to where you can't go back and get the future goals.
Here's what the answer is: step eight. If you've gotten to step eight – that's abundance goals – prepaid future expenses, rock and roll. This is when you can go – this is when you can go buy your nice car; this is when you go get that Rolex watch; this is when you can actually upgrade to business class when you go on your European vacation. And the reason is because you funded all the other stuff, all the "get rich" activities that build foundational wealth, have actually been covered through steps one through seven. When you get to step eight of abundance goals – now, look, there's some of you'll be like, instead of first-class tickets, maybe I'll fund the kids' college, or you want to get into doing rental property, other things. It's every person gets to make the decision of what does your step into abundance look like. Because we all have different goals, we're all different, we all have different fingerprints, we all have different goals, we have different financial lives on what makes us happy.
You know, I just hope – I hope I have enough friends like you that want to buy a boat that call me. It's just like we have somebody in the office – I won't say their names. I can't wait. I love when friends make those types of decisions. So, we're all about it, because that's the purpose and the value of the financial order of operations – it liberates you. Everybody thinks that's financial advisors – we probably sit around, and Susie Orman, I feel like she built her entire career when I watched her show in the past – is everybody calling in, and she's like, "No, you can't do that. Get out here; you can't do that." And everybody just loved hearing her say, "No, no, no." How many different ways can she say "no"? I'm telling you, as a financial advisor, my favorite thing in the world is when you get to step eight, abundance goals of prepaid future expenses. That's the big old "yes."
I mean, when I had the client who – he was a school counselor, he had some land, and he was like, "Man, I'm just getting to the age where I'm having trouble going and feeding the geese and feeding the animals and taking care of – I really wish I could buy a gator." I was like, "Bill, go buy a gator. Get your gator; go buy your John Deere Gator; live your best life." That is what step eight of the financial order of operations is all about –
moneyguy.com/resources if you want to download your free copy. If you want to go in the deep dive and really know how it works, learn.moneyguy.com, and we can accelerate this even faster. The two best days in a boat owner's life, right, are the day that they buy – everybody – but for your friends, their best days are every day in between. Right? That's it. That's why I'm so excited about it. So, I would encourage you, Eric, instead of going to buy your own boat, hey, have one of your friends do it. Just make sure you offer to buy gas for them. Yes, of course. Bring some snacks.
