I Am 28 With $120,000 Invested (Can I Slow Down Investing?)

Next question is from Queen May. It says, “I’m 28 with $120,000 invested. Nice. Can I let off the gas on investing? I would like to quit my job and stay home with a new baby, but that’s only possible if we lower our investing. Also, I pre-ordered your book, Brian. Oh, thank you, Queen May. That’s so nice. Kow, um, so I, I answer. I love that. Um, I love that life happens, right? So Queen May said 28, just had a new baby, right? And they’re trying to decide, “Hey, can we do it where, you know, one of us stays home with the baby?” And that’s awesome, right? Uh, so the answer to the question is, can I let off the gas pedal? Well, this is one of those things that, if we were having a conversation, we’d have to answer your question with a question. We’d have to say, “Okay, well, what are you trying to accomplish? What are the things that you want to have happen, both now as well as later in life?” Because when you go from a two-working household to a one, from a two-income household to a one-income household, one of two things can generally happen. You might have to decrease your savings because income decreases. But if you also decrease your expenses, that might be okay. If you can live in a place where, even with one income, you’re saving 25% of your gross income and you’re living off the remainder because you’ve trimmed your expenses down, that’s going to be okay. I think where people get themselves into trouble, I think where we have problems is folks got accustomed to living on two incomes and they knew what their living expenses were at two incomes. Well, then one of the incomes falls off, and rather than shrinking their lifestyle, shrinking how much they’re spending, they try to maintain the exact same lifestyle. Well, if you do that, the thing that ends up getting cut out is the savings, and that can happen in seasons, and maybe that’s necessary based on where you are, the family, but it’s something that you need to be aware of. We’ve seen far too often folks that were killing it in their 20s, and they were just absolutely going gangbusters, doing everything they were supposed to do. And then this little season, we like to affectionately call the messy middle, hits them, and I mean it hits them right in the jaw. And all of a sudden, just because all of these different things start pulling on you, and you’re getting pulled in a thousand different directions, your personal finances fall to the back burner. And you recognize that, “Hey, I was 28 years old and had $120,000 saved up. Holy cow, how did I get to 38, 38 years old, and now all I’ve got is $150,000?” Well, it’s because life happens. So you just have to be aware of that and understand if you’re going to squeeze the balloon, how are we going to squeeze it so that we’re not sacrificing our future well-being exclusively so that we can do the things we want to do today? Queen May, I want to, we just did a show, if you want to go look at our AR archives on the five levels of wealth. And just to review for everyone, those five levels are first stability, then strategy, then security, freedom, then lastly, abundance. That’s kind of the intersection point of wealth plus having purpose and knowing why you’re here. You, Queen May, are definitely in the strategy phase. That is, you’re 28, you’re young, but you’ve done a great job of building assets. You already have reached that, what I consider the first step of the bowling point, is you reach your first $100,000. And it’s going to be so much easier to get to the next $200,000 than take it to $300,000. But one of the cold hard realities that when you get to step three, which is security, is we remind people, even who have tremendous success in their 20s, the thing they’re missing to truly say you have now the security where you can start quitting, sweating the small stuff, and start doing a few additional things is you just haven’t had enough time to fully develop and let your assets build underneath you to work for you. Your army of dollars hasn’t grown and recruited enough to truly know what happens after the messy middle and all the life changes and everything else. But that doesn’t mean I… I give you a little cold water, but then I want to tell you, because I’d be a hypocrite otherwise, it doesn’t mean that there can’t be temporary moments in your life where life changes. Where, you know, having a child, you start a business, you change jobs, you’re buying your first house or you’re moving or something like that. Life happens. That’s the big thing we always share. I don’t have a problem if you have to triage your situation to take a moment in the financial order of operations to figure out where you’re going for the next three years, making a temporary change, being very focused on what the goals are, but then getting it back on track. We’ve even done slides on this in presentations where a lot of people think the financial order of operations is walking through the steps just like you’re walking up a set of stairs. But it might actually look like a group of peaks and valleys that are going up, just like that walk up the mountain that we talk about with investing, is that you will have setbacks if you lost a job or just life changes or you bought a car or you bought an investment or something, a building or something like that. It could be taking you back to where you have to build up cash reserves and other things. There’s nothing wrong with you taking a step back. But what I didn’t love about the way you asked the question was, “Can I let off the gas?” That seemed more permanent instead of temporary. So I would ask you to challenge yourself and even use the tools that we have. If you go to learn. money.com, we have the “Know Your Number.” You need to do some modeling. You need to kind of know where you’re going, what you’re building, to kind of know if you’re behind the curve or on the curve or behind the curve, because these big life decisions, it’s definitely a “measure twice, cut once” type thing. Yep, love it.