He Saves Everything. She Wants to Enjoy Life. Who’s Right?

Introduction: Communication and Financial Tension (0:00)

Bo: When it comes to finances, are you guys often on the same page?

Anna: I think I just feel a little pigeonholed sometimes about we’re just going to have to keep saving forever. It’s always serious and it’s never fun. And those things really wear down on me.

Bo: If I were to look at your budget, I’m wondering how many different categorical items I’m seeing. Right now, what I’m feeling is more of a communication issue than a dollars and cents issue. And that’s the part I think that if y’all can get centered on that, you can do anything.

Bo: So this conversation like, “Hey, I signed us up for this thing.”

Anna: He just said, “I just wrote into this. I didn’t know if we would get chosen.” And I was like, “Oh, okay. I didn’t know that you did that.” And yeah, then we basically talked about it and he was like, “Why don’t we just make it a weekend and we’ll just go and have a good time.” So that kind of convinced me to do it.

Bo: I love it. So what are you expecting from, like what do you think’s, what do you think we’re about to talk about here? How’s this about to go down?

Anna: I don’t know. I just I guess process through our finances and how we work through it together.

Meeting Luke and Anna (1:00)

Brian: Let’s jump into who you guys are because I mean it was kind of fun exciting to see y’all got some kids.

Luke: Yeah, three of them.

Brian: How old are your kids?

Luke: Our oldest, he turns seven next week. Our middle guy, he just turned four in January. And then our daughter, she turns two at the beginning of April.

Bo: So boys and a girl. That’s awesome. That sounds like a very messy middle is what that sounds like.

Luke: Maybe just to give like more context, we got married and started the messy middle like immediately. So we got married before our last year of college and then that summer before we both started our teaching jobs, we both became teachers out of college. We got pregnant that summer before we actually were working full-time. And so March of our first year both working full-time, we had our son. Okay. And we essentially banked one of our paychecks from like August until January and bought a house in January of 2019 before COVID, a couple months before. It worked out. Okay. I mean like we were still in it. At the time I’m like freaking out like this is so much money and now I’m like that was the best decision we’ve made.

The Messy Middle Journey (2:09)

Luke: We have another kid a few years later. Once we have two kids, I’m teaching, coaching basketball. She’s teaching full-time. We have two kids and we’re both kind of on empty for our own kids. We’re just like we’re not in alignment with our values as a family and what we want to be able to give our kids, even just emotionally. Yeah. And so she and I kind of saw the writing on the wall. She was like, I do not want to keep teaching full-time. And she decided to stop teaching full-time after we had our second. I think we did a year.

Anna: Yeah. I taught for a year, both of us teaching full-time.

Bo: Three years ago or so now?

Luke: Yeah. I think it was the third school year. And so, but that meant we were losing half our income. Sure. Also, more background, I grew up in a family where I saw my parents go through some significant financial hardship. And she grew up in a family, her dad was a dentist. They owned a second generation dental office. Just very different experiences with money. Me, very debt averse, very like I’m going to know every number and where every dollar is going. And that wasn’t what she came to the table having experience with money. And so yeah, losing out the income for me is like we got to get going. And so I was still teaching, coaching full-time, started multiple things on the side just to bring in extra income. Some out of passion, some out of just need for more cash. I burned myself out really badly for like 18 months to two years just doing like 50, 60 hour weeks between everything. And then summer 2025, I hopped out of teaching and coaching full-time, got a remote corporate project manager job. That was a really significant raise just in a W-2 salary. I went from making like $60,000 as a teacher and coach to $90,000. Oh wow. Totally the Lord. Yeah. It was like I didn’t even apply for any other job. The right person moved across the street. We took them a meal after they had a baby and I was just like, it was summer 2024 because it was after, yes, you’re right. Yeah. It was just a huge blessing and it was just like okay now the family is taken care of. So like now I don’t have to do all this crazy side stuff that I was doing. And so I had like an online newsletter that I had started and sold that email list and a local Christmas light company that I had started with a partner and sold my half of that. And then the third thing that I was doing, and part of kind of what I’m really curious to get your guys’ insight on today is summer 2024 or 2023, I started some sports camps locally in Northwest Arkansas.

The Sports Camps Business (4:43)

Luke: So, my background is in teaching and coaching, also a background in camps. My parents started and ran a nonprofit doing camps for kids with disabilities when I was in high school, and I was either working at that or another Christian sports camps in the summer. So, my background is in camps and teaching, coaching. I’m really passionate about kids having better experiences in sport. And so I started these camps locally and they grew over those first two summers just doing them locally and then going into summer 2025, I brought all of those camps under the Nike sports camp umbrella and grew those regionally last summer. So, two summers ago it was like 100 kids in Northwest Arkansas between a couple camps. And then last summer was like 420 kids across four states, seven cities. And then this summer is going to be probably somewhere between 1,000 and 1,200 kids in a bunch more states and a bunch more cities. And so still have that thing on the side that I’m really passionate about and love doing and have the W-2 now that’s kind of taking care of what the family needs and then she’s doing a couple things on the side as well to bring in some extra income. So I just felt like that context is probably helpful. Like yeah, we were just kind of in the messy middle like right when we got married almost and started having kids before we thought we were going to. And so the last 12 months, 12 to 18 months is like the first time in our, we’re going on nine years of marriage this summer. The first time in our nine years of marriage we’re like oh we’re probably like in the best financial spot we’ve been in.

Anna: We didn’t get the like five to seven years to save before we had babies. No kids was six months.

Bo: You know, most couples when they get married, they have like these early years to figure out each other, right? Like first two years can be hard anyway. Just getting to know each other completely.

Luke: Oh yeah. We only dated for four months and we were engaged for four months, too.

Brian: Wow. So rather than like having that time to kind of figure out you guys as a couple, you had to like jump into being parents.

Bo: Right. So now that things, I don’t want to say settle down because with a seven, four, and 2-year-old nothing is settled down. You didn’t have that like acclimation period early.

Financial Alignment Challenges (6:52)

Bo: When it comes to finances, are you guys often on the same page? Like are you like oh yeah we’re dude we get this. Like it’s just we naturally look and think about money the same way. Or is that not the case?

Luke: Do you want to answer that question?

Anna: I would say in almost every area we’re on different pages, but we’re just very different people. We’re like the opposite. If you guys follow Enneagram, I’m a seven and he’s a one. And so just everything that we do.

Brian: I’m a seven! He’s a three.

Anna: Oh, yay. I love it. I mean, everything, a lot of things motivated for me are like experience-based and having fun, and I value those things a lot. And yeah, he definitely likes those things. I will give him credit, but he just doesn’t value them as much as I do, I think. And so, I’m viewing things usually out of the lens of like, how can we enjoy our lives? How can we give our kids good experiences? And he’s like, how can we be smart and safe?

Luke: And I’m just thinking about the future a lot.

Anna: I think too, like taking care of young kids, it’s like I don’t really have a lot of mental energy to give to the future. I’m like I’m just like in the right now, you know?

Bo: Does it create a tension with you? Like how do you have the conversations around that? Like is there tension or do y’all have like these like hey financial meetings that we’re going to go? Like how do you guys do it as a couple?

Luke: I would say it’s been one of the biggest sources of conflict in our marriage since we got married. I say that and it’s gotten better and I’d say even in the last year it’s gotten a lot better. Not just for that reason, for other reasons too. We’ve done some marital counseling like multiple times throughout our marriage that’s helped there too. We’ve also just in the last year put in some better rhythms into our months and weeks. Like doing some quarterly planning as a family and having some weekly team meetings where one of the things we’re going through is money. Because my tendency prior to that would be like every day when I saw something that I didn’t know what it was for, I’m asking about it. Like, hey, what was this?

Bo: I got to believe that went really well. Every single charge, right?

Brian: Yeah. Well, lean into because that’s what I was curious. I was immediately going to ask if you have a difference there. Are you building some collaborative moments where like we do skip days with our spouses where we go and basically take the day, go over the net worth statement, talk about the trips we want to do for the year, talk about goals for the year, go look at what we did planned last year. Are y’all creating those checkpoints so it doesn’t seem like the Wizard of Oz where you know Anna’s having to come and ask Oz what is the plan or are y’all doing this where you’re kind of united front?

Luke: Yeah, we’re getting there. Where even this weekend before we came in and record with you guys, one of the things we did was kind of have our annual like marriage check-in planning. We didn’t get into the nitty-gritty of the numbers during that because we’re going to kind of do that today some, but yeah, we’re having that weekly meeting and then quarterly we’re sitting down and planning like, hey, what are the things we’re going to do this quarter with each other, with our kids, and then like what’s the vacation we’re going to take with our family this year. So, yeah, we’re getting better there. I think doing something annually financially would probably be maybe a next step to add to that where we’re really checking in on.

Brian: Do you feel like you are checking in to make sure it’s a collaborative experience?

Anna: Yeah, it’s definitely gotten better. I think I don’t enjoy being micromanaged and being told what to do and his personality is like he just wants to know information and so sometimes that comes across to me as like you’re just trying to control me and you’re trying to tell me what to do. I think in the past, you know, it brings up some anxiety for him not knowing like what expenses are what. That can come across as like what are you doing and like anger almost like why did you spend this, you know, and then it’s like accusatory more where it’s like okay so I just can’t spend any money ever, you know, that’s what it kind of has felt like in the past where even like within the last maybe 3 months we started that kind of meeting every week and that’s helpful for me because then he’ll just look at the expenses and be like, “Okay, well, did you buy from Target?” And like, “Where does it need to go?” As opposed to, you know, like when it’s every day, I’m like, “I can’t do this. Like, I can’t. This is way too micromanagy.” And I, yeah, it was. Yeah.

Current Savings and Investment Strategy (11:09)

Brian: If I asked you if like what are y’all saving as a couple, do you have an idea of what y’all are saving as like a percentage of y’all’s income or monthly?

Anna: We’re not really saving that much. Most of our expenses are going, I mean except for investments. Yeah. Most of our, I was asking that as well like what are we investing because I want to know.

Brian: The reason I ask this is that I have, we’ve been doing this for, I’ve been doing it longer than everybody because I’m getting older unfortunately. But I have a gentleman that I gave counsel to. He wasn’t, he’s now a client of the firm but he at the time he was just in a Bible study with me and there was some issues where his, and they were older than you guys are but it was that, you know, they set this ground rules where every expense he was putting, I can’t remember if it was Quicken or some tracking software and after you do this for 20 years of marriage his spouse was like what are we doing, you know, I feel like I give you every receipt whereas I tried to work with, hey, why don’t we set goals so that we can know what we’re all saving for in a collaborative way. But then after we know that we’ve set it and forget it and autopilot with it, all the accountability kind of goes away. That’s why I like, I love budgeting when you’re in the beginning of developing good habits. But I like kind of transitioning to a cash management plan where we set our goals and pay ourselves first and then that way it frees you up to just spend what you want with what’s left over because you know you’ve already done the heavy lift on the front end. It’s hard to, it’s easier to say this, but in the messy middle, I know every dollar is going to have a name or a goal tied to it. But still, if you can start doing those behaviors, it at least helps you to know that there is a point that this is going to break free. If I can grin and bear it through this part, because right now you’re probably saying, if this is what I’ve got to do for the next 50 years of life, this is going to be overwhelming. Yeah. But if you knew that this was, you know, over the next 5 years, if we reach these success goals, hallelujah, we’re going to be, I’m going to be able to not feel like I have to track everything. I think y’all will see it actually serves everybody’s best interest to kind of have that.

Anna: I don’t want this to sound rude. I don’t know if there will ever be a time in our marriage where he won’t track things because of just his personality is pretty meticulous. But he does have like categories for every single dollar that we spend. And that bugs me so much because, you know, I’m like a free spirit and I’m like, there’s just not a category for everything. There’s a kid birthday party that’s going to pop up and we’re going to have to spend 25 bucks on a present and like I’m not going to go to the kid birthday party empty-handed, you know? So, I don’t know.

The Role of a Financial Planner (13:53)

Brian: This is where a financial planner comes in. A lot of people think financial planners tell everybody just no. We play the old, you know, Suze Orman where she, you know, kind of is like, no, you don’t get to go on vacation. No, you don’t get to buy that car. We’re actually the exact opposite. I feel like we are, because we are also super financially minded, but we also come at this from we need both spouses to be happy. I feel like a lot of my job is to advocate for the non-financial spouse if I know the analytics are lining up so that I can knock around the analytical spouse and say, “What are you doing? You can’t take it with you.” So, let’s make sure we’re maximizing. So, this is a lot of people. We’re not therapists by any shape of the imagination, but we do know the human psychology of relationships and money and the analytics that I think that in a lot of ways we do fill a void for a lot of couples is because we advocate to go do more which a lot of couples need because all through society we’re told save, save. Where’s the consumption come in? You know, and I know we live in a society where 90% of the public all they do is consume and nobody saves. But for responsible financially minded people, we need help on the other side of it. And you probably resemble that or recognize that in yourself.

Luke: And I would say that in the last year even I’ve made an intentional shift there too of hey, we need to allocate more money on a monthly basis towards us having date nights, us doing fun things with our kids. We need to take a chunk of money and we need to put it towards family vacations. I know that often we both feel like we wish we had more for some of these fun things. I’m the one that manages the finances and you’ve said to me like that’s not something she wants to do either and that’s fine. But I know that I need and I have some good friends and other voices too in my life that remind me of exactly what you’re saying like hey you need to recognize that your wife is not like you and you also need to not just be frugal frank your whole life and miss out on enjoying experiences with her and my kids.

Current Net Worth: $342,000 at Age 30 (15:59)

Bo: Let’s talk about where you guys are presently because it’s actually a pretty good picture, right? Remind us how old each one of you are.

Anna: I’m 30.

Luke: 30. And I am about to turn 30.

Bo: So, you’re both two 30-year-olds. And as we sit here right now, you have a total net worth of $342,000. That in and of itself is like a reason to pause and celebrate because that’s pretty awesome. I think there are a lot of 30-year-olds out there like, “Holy cow, I wish that’s what my net worth statement looked like.” And you can see that on cash you have just under $40,000. You have liquid investments just over $106,000. And then you have a house that you have a bunch of equity in. $380,000 house. Your mortgage is only $183,000. I’m assuming this is the one that was bought in 2019, right? That that helps. That certainly helps build a net worth statement. So as it stands right now, you guys are in a pretty solid financial place. Do you feel that way or do you feel like you’re behind the curve?

Anna: Well, I think just for the context of what Luke said earlier, it’s hard for me because I’m comparing myself to friends who worked for seven years and they saved bunches of money and they have these nice houses and new cars and all this stuff and it’s like, well, we’re just not there. And I know that I’m not saying like I’m just living my life out of comparison or anything, but it’s like, oh, it would be nice. We have three kids and I have a Toyota Highlander, which like it works. It fits all of our three kids. But I’m like, it would be nice to have a new car

Bo: Like a minivan?

Brian: We live this life. I want to hear what you want. What do you want?

Anna: Highlanders. Luke just, well, it’s a 2011. It’s like not new. But Luke just bought a minivan and it’s green. It is a green minivan. I was like, out of all the cars.

Bo: $8,000. Yeah, but it’ll be so easy to find in the parking lot, right?

Anna: That’s the goal. Our kids love it. So, whatever.

Luke: I told her she never has to drive it.

Brian: You want an SUV, right?

Anna: Yeah. I would love an SUV.

Brian: I mean, domestic or European. Or Japanese?

Anna: I’ve been looking at Nissan Armadas. I like those. Just something a little bigger. I don’t want like a ginormous one. And I don’t even want like a 2026 like brand new. I just want Apple CarPlay. That’s like literally I’m like I just want Apple CarPlay, please. But anyway, all that to say, I think it’s hard for me sometimes when I’m like these people are exact same age. They have kids around our age and maybe even they had kids at the same time as us and they’re just choosing to use their money in different ways and they have all these like really nice Crate and Barrel house stuff and you know brand new cars. And so that can feel hard for me sometimes of like oh man like we’re just, I think sometimes we’re still functioning out of that like grind mindset of like we just have to like get the cheapest things all the time and Luke also just doesn’t value at all like having nice things, which is like that’s fine. He values other things, but like I don’t know, just a silly example, the towels that we got for our wedding, they’re almost 9 years old and we still use them. And like he’s like, “Well, we don’t have money for towels.” And I’m like, “But we could find money for towels.” But just things like that where it’s like he doesn’t value that. He’s like, “The towels still work.” I’m like, “They have holes in them.” So, it’s just yeah, there’s just different I think things that we think are important.

Defining Financial Goals (19:28)

Bo: If I were to ask each of you, hey, just tell me like your top three financial goals, like and I want to leave it that open-ended. And let’s start with you. If I was to say, hey, what do, like money is nothing more than a tool. Yeah. That allows us to accomplish the goals that we have, right? It’s not a goal in and of itself. It’s not this. It’s literally just a tool. Yeah. So when you think about what money could do for you and your family and your household, you think about like your top financial goals, what would those be?

Anna: I would say number one for me is experiences. So just taking vacations with our family.

Bo: experiences today, not like tomorrow experiences, like stuff we can do, create memories for the kids today.

Anna: Yeah, of course. Yeah. And just consistently being able to take them and show them the world. I think that’s really valuable. I think also, yeah, we’ve talked about this this weekend. Even just giving is really important to us. Just being able to serve people with our time and our money and help other people. You obviously don’t want to be just completely selfish with what we’ve been given. So yeah, I don’t know. Experiences are just like such a high priority for me. So like even if that includes like things with friends like eating out or you know going to a concert or just those kind of things where it’s like we’re connecting with other people and we’re doing something together.

Bo: In these goals, and I’m not picking it up because I’m generally this is a very familiar conversation that I’ve had in my marriage, so this is such a comfortable and familiar place. But I didn’t hear in there like towels, home decor, new car. So, did you just not say it or are those not really goals? It’s like those are nice to have, but not. Or were you nervous to say it?

Anna: I do value like home things, but I think I just in our nine years, I have like for maybe a year been allotted a budget for home things. So, it’s like it’s just not even like in my mind. It’s like, oh, we just don’t have money for that or it’s going to be met with like, well, that’s not a need. This is a big point of frustration and please like give us some advice on this because this conversation comes up maybe once every six months and he has different opinions of what a need versus a want is and he is very much like Maslow’s hierarchy of needs. Like our needs are food, water, shelter and like that is what we need. And I’m like okay but also we need things to take care of us like towels to dry off from the shower. And he’s like, “Well, we don’t need that because they still work or they still function.” So, that’s a frustrating, I think, argument that we get in frequently. It’s like, okay, just because you don’t consider it a need doesn’t mean that we don’t actually need it.

Bo: My wife and I, we’ve been married for a long time now, and that was our struggle early on. The things that were valuable to her were not valuable to me, right? And the things that I put a lot of value on that, she didn’t put value on it, but she didn’t think about it the same way that I did, right? And I had a lot of learning to do that just because I thought, you know, just because I was perfectly fine, eating this and sleeping on this and wearing this did not mean that it was appropriate for her to be okay with that. And so I had to, there was some tension there that I had to like figure out. But before we get into that, I want to hear your goals, right? So we kind of heard really got two from you.

Brian: Yeah. Experiences and then giving, serving others, then time with friends. And that’s what, there was kind of a third is that I think it’s just the unspoken one is that to feel heard in the budget of the needs versus wants.

Luke: I’ll talk about the sinking funds on the budget category because that really ties into it. In December, January, we had some, we had some of the most productive money conversations we’ve ever had in our marriage where we said, “Okay, what are our big goals for the next 5 years?” The first one is that we want to be able to either move or build a house in roughly 5 years. That’s about the time our oldest is going to be that middle school, junior high age. And we really want to have a home that our kids and our kids’ friends want to be at. That’s something that’s important to us. We both experience that as kids. And we just like we have a good home right now. It’s three bed, two bath, 2,000 square feet. We’ve got three kids. Like it’s getting full. And so we’d love to have a home that yeah, accommodates a lifestyle that I think we both would really value as our kids get older.

Bo: Can we assign a number to that?

Luke: Yeah, we put $100,000 for it.

Bo: But I’m sorry. The price of the home, the price of the home. So, you said right now $380,000 where you’re at right now getting a little small. What would be the price of a home in your area that would be comfortable?

Luke: I would say somewhere between $550,000 and $650,000.

Anna: We’re not looking for anything ginormous, but just bigger, you know, gathering spaces so that people can hang out.

Luke: That was one of our big goals and we kind of put down some like, hey, how much cash do we think we need to save to move towards those things? We put $100,000 for that in the next five years.

Bo: Is that what the sinking fund is?

Luke: That’s starting to go towards that. And then there’s two others that are more near-term. That one’s like, hey, 5 years from now, we want to have that ready to go. We want to be moved or build a house. The most near-term one is upgrade her car. And then the second one in September of 2027, we want to take a trip to Italy for our 10 year anniversary.

Anna: Our anniversary is in June, but he does camps in the summer, so we’re going to do it in the fall.

Bo: Can you give me a price tag for like what an Italian vacation is? And is this just the two of you or is this whole family?

Luke: Just the two of us. I want to have $10,000 for it.

Bo: See, I love that. I love that you guys have already talked about this and this is like a thing that you kind of have put down to work towards. Now, you said upgrade the car. Were you thinking like an Odyssey or like a Sienna? Oh, yeah. Well, I was double-checking. I was making sure that the minivan wasn’t back on there. So like a Nissan Armada, something.

Anna: Yeah, something in that realm.

Luke: Yeah, we would sell her Highlander and put that towards it. So I think we had put down saving somewhere between $20,000 and $25,000.

Bo: I’ve got timeline for 5 years to the new home. Italy is going to be in September 27. What’s the timeline of the new car?

Anna: Sort of like soon. I would love it to be soon.

The 3D Glasses Plan (25:45)

Brian: I mean this is what makes personal finance very personal. It was so interesting is I see the path forward but I’m trying to figure out if y’all have the right structure to do what needs to be done and let me explain what I mean by this is that you’ve heard us talk about put on your 3D glasses. You’ve got some big life decisions because you’re trying to figure out if you’re going to go full-time even with your side gig turning it into a full-time gig. And I could tell, I mean, what’s interesting is that Luke, as you’re sharing with us, I could see the passion and the excitement about what you do. Yeah. That there’s a chance that this thing could become your main job. But that’s why you have to do the 3D glasses plan. And just to bring you up to speed, what this means is you actually write out your life plan or business plan with your dream. Oh my gosh, this thing hit everything I thought it would do. It’s hit financially, fulfillment. We went bought the Armada. We’ve got, you know, that’s the dream. You have the down to earth plan of what really will happen because it’s not going to be the dream plan. It’s probably going to have some hiccups and some other troubles. And then you have the doo-doo plan is that you go full-time with this, but it goes horribly wrong. So that’s and it’s going to take, I’ll just go and tell you because I’ve gone on this journey of entrepreneurship. It’s going to take three years to probably get this thing to where it’s back to what you were making beforehand. So, you have to give it enough nutrition and through cash and savings to get it through that season. But what’s in conflict with this goal will be the house upgrade because I mean when I looked at y’all’s notes, I immediately saw we have a house that’s worth close to $400,000 and y’all’s mortgage rate is what? 3.25.

Luke: 3.5, I guess.

Brian: And I know it’s too small of a house for what you need, but man oh man, the debt. I mean because y’all’s monthly payments are like $1,500 a month. That actually went down because I got different homeowners insurance. So that is a blessing while you’re starting the entrepreneurship because your footprint on draw down is so small. The paid for cars, that is a blessing while you’re trying to nurture this business as much as possible. But it’s completely working against all the things that was on the other side. You know, they all said was happiness. So that’s why it’s such a conflict in the fact that you almost have to, that’s why you have to be a united front is that oh my gosh we’re going to go all hands on deck because y’all don’t have debt issues but you got life battles that are just as bad as having debt issues is that we’ve got to kind of come up with a three to five year plan that we’re going to be in this thing in the weeds with it together and united. But if it hits all that, looking at my neighbors and seeing what they have and I don’t have, if it would be that. And because it’d be the engine, the economic engine. Because right now the way you make your money, you know your job, it’s going to have limits. But if you could make this thing passion work, you’ve now upgraded the engine instead of having a four-cylinder, maybe now you have a V8, you know. And that’s the thing I always tell people because realize I was a 16-year-old kid that had the 12-inch woofers and the rims and the louvers, all those accoutrements, you know, of life that you’re putting on of the nice car and that stuff. That is the hub caps and that’s the accessories of life, but we got to get the engine right first. And y’all are so young, but what makes it hard is the kids and all the other stuff. But y’all, that’s why the plan has to be united so that y’all don’t, it doesn’t break down and you feel your voice is heard, too. Yeah. Because we live this life, by the way. You’re not doing anything wrong. I’ll pick on Luke is that we’ve got to have the plan so that y’all feel united in this thing. And then that way you don’t look at your neighbors because by the way I’ll go ahead and insulate you. Most your neighbors either, what you never know is you never know who comes from some money, who’s getting support family-wise and you never know who’s just faking it until they make it with so much debt. I mean, because that’s the thing. All through my life, I’ve noticed as I’m going through in the same season you’re in, we tried to set up parameters of pay ourselves first and do these things, you’ll get to be in your mid-40s before you really get to see between the seams of who actually has it and who doesn’t have it because you can fake a lot with debt. And you’ll quickly realize, and that’s why I would challenge you to kind of look in your inner self to figure out what is happiness and what is peace. Because the, and then take away, just don’t let the noise bother you if as long as the plan is letting y’all feel like y’all are working through something.

The Entrepreneurial Journey (30:28)

Bo: When he lays out sort of the tradeoff and the risk and reward of like going out on your own doing this camp thing full-time versus not. Give us how do you hear that? Like what have you guys been thinking in terms of like turning this side gig into the main gig?

Luke: It’s the reason I like kind of worked myself to the bone for a couple years. Like I’ll do whatever I have to do to make sure my family’s taken care of first. So like if I’ve got to stay in the W-2 for five more years, 10 more years, like okay, I’ll do it. It wouldn’t be my preference. I’d love, we all want to do work that we love with our time and work that turns the economic flywheel. I would love in the next two to three years, which I think is a fairly realistic plan, to be able to take the leap and do the camps full-time.

Bo: Are you saying that you think that in the next 2 to 3 years, the camps would be able to replace?

Luke: I think it would be able to replace almost all, if not all of it. What it didn’t replace, I can make up the rest of it during the school year when I have a lot more time margin in my schedule.

Brian: And is this a long-term?

Luke: This isn’t something that would go away in 5 years or six years. This is like I’m doing this for the next 30 years. Like I just I love it.

Bo: Is taking the leap as it relates to the side hustle, right? Like so you got your W-2 income and you have your side hustle income. Are you saying like in two to three years you think you will have built up the side thing so that when you take the quote unquote leap, you’re not having to take a big pay cut?

Luke: Correct.

Bo: Okay. So it’s likely that you could just maintain standard of living even as you make this transition. You will know in 2 years if it has reached the point to where it could be the main job. It’s not like there’s a risk where you’re like all right, I’m going to go on my own and hope it works. You have kind of already built it at that point, right?

Luke: Yes. Exactly. And I would say a couple things there in addition. One, as our kids are getting older, we think we’re done having kids. She’s wanting to work more as well. And so I think the income she’s generating is going to continue to increase more than likely.

Anna: I do work part-time right now. I have a part-time marketing job and then I have a spray tan business that I run out of our house and then so I’m doing some like little side gig things and I do enjoy working with three littles too. So kudos to you. I like being busy. I do it to myself.

Luke: She works hard. You know that seven life, you got to fill your time, you know. And so like right now even in just like our monthly budgeting, the owner compensation from the business that’s operating the sports camps, like we’ve never lived off of any of that. That’s gone towards those future goals essentially. And so like after this summer, I’m going to have a really good idea of like, okay, what was I able to compensate myself from that and then restarting the cycle again for the next year and projecting. I project very down-to-earth growth and I’m very conservative with my projections.

Brian: But it sounds like this camp almost is going to double in a year based upon how well things have gone. So I mean that’s pretty normal. I would tell you to plan conservatively but you will be really surprised if things hit the exponential opportunities can be much bigger. But go conservative.

Anna’s Financial Goals and Frustrations (33:44)

Brian: I did want to put Anna on the spot because you gave us some goals with the car. I know there’s a house sitting out there. If Luke did a better job of saying, “Look, the next three years are going to be tough, but we’re going to prioritize Italy because I think it is.” I think I would put that at the top. I’d put that because that’s a life experience. That’ll be something that y’all could go ahead and, if you, I don’t know, in my book in 2002, right as we were right before we had our first child, my wife and I went to Italy. And we did it so cheap though. No, we didn’t. We rode in the back of the plane, you know, and we didn’t do all the guided tours that we wanted to, but it still was incredible because you get all the visuals, you get all the stuff. So, you don’t have to, $10,000 didn’t sound crazy to me because I mean I fast forward and take through inflation what we spent. That’s not that bad.

Luke: She studied abroad there. Yeah, I really want to go back. I said $10,000 and she was like that seems high and I was like I’m not going to go unless I know I have the money to make it a really awesome experience for it. That sounds great.

Brian: If you and Luke came up with a plan that he was going to really go for it to try to create a better economic engine for the family and but y’all prioritize this 10-year goal. Could you find yourself deferring on the car and the house stuff just a little bit longer if you knew that there was a time certain that this thing was coming to a maturity?

Anna: What do you mean?

Brian: Like I’ll tell you maybe it’s easier if I just do an experience share. I told my wife that if she could go on this journey that we were going to live really tight through our 30s, but in the 40s we’d go prioritize some key things that she had. But in the 40s, if we did this today, did some deferred gratification in our 40s, we’d go wide open on the life stuff. And it worked out. I mean, because now I had to officially like I was on a trip this weekend with some high school friends and they’re like, “Are you still a tightwad?” You know, because I was the kid with the coupons and everything and I was like, “No, they came and ripped the tightwad card out of my back pocket because of how lifestyle has expanded.” And that’s what, but you don’t have to, it’s not faking it. It’s actually you’re now living your best life because of some of the fruits from the early. But and that’s why I just want to make sure because what I worry is you guys have some cracks in the foundation. If we don’t nurture this now, it could get ugly later. But I want to make sure you feel heard, but also on board with the game plan.

Anna: I think I just feel a little pigeonholed sometimes about we’re just going to have to keep saving forever. Like there’s just never an end date of like now we can spend what we’ve saved, you know? It just feels very like it’s always serious and it’s never fun and those things really wear down on me, you know, because I like to have fun and I like to have good experiences. And so when it’s met with that, I think I’m kind of just like I feel a little exhausted. I’m like, “Okay, all right. I guess we’ll just keep doing this.” And so it probably would be helpful to have an end date in mind. I would really like a new car soon. Okay. I don’t need it, especially in, you know, definition with Luke’s need definition. But I think there’s a lot of, you know, just in our world right now, like there’s a lot of narratives about, yeah, you, once you have a second kid, you need a ginormous car, or once you have this, you need this thing. And I’m not functioning out of that necessarily, but I think these updates just feel like, okay, like we will someday get to have newer, nicer things. And sometimes I just feel defeated because I think it feels like, okay, we’re never going to get to that spot, you know?

Creating Financial Wins (37:28)

Brian: And I can tell you’re getting, I mean, and I love it because I feel like we’re getting somewhere. We keep talking about the big stuff, you know, the cars, the house, but it sounds like there’s probably a bunch of, because we’ve already talked about the towels. I mean, the towels, there’s some little things that sounds like if, and Luke, I’m going to put it on you. We could create some wins for Anna in a little way. And y’all figure because y’all thrown out a lot with whether it’s eating out. We just need to put a dollar amount on it and figure out that way. We know we can put a number around what Anna needs to feel loved, heard, and appreciated and still have the plan to build in the background because that is the hard part as the financial mutant is you’re trying to do this. But you’re going to lose the other side of it if we can’t make sure that you’re feeling heard through this journey because both of y’all are noble in what you’re trying to do. It’s just this is what makes it hard in a relationship is money is tight.

Bo: Can you walk me through your current savings, right? Like when you think about these buckets, I’m not talking about the budget necessarily, but like what’s the money that right now you’re putting in the different savings buckets for the future?

Luke: Yeah. My W-2, I put 6% into a Roth 401k and they match 4%. That’s great. And then maxing out our HSA. We’ve been maxing out our HSA for like the last seven years, but we’ve been having kids and so you’ve been using it. We’ve been using it. That’s great. This is the last 12 months again is the first time where we’ve gotten ahead with HSA and now like roughly $10,000 of that is invested. Awesome. And then there’s $100 bucks a month just going into the emergency fund account.

Brian: How about the Roth IRAs? Because I noticed Anna’s, by the way, was bigger, which I was like, man, so you’re obviously prioritizing her.

Luke: So, and this is, her parents were really generous and they had a custodial Roth for her that they, I love hearing that. That’s great. Yeah. They passed that on to her a handful of years ago. And then my Roth and her Roth also. So, when we left teaching, I took our teacher retirements and rolled them into Roths. I just bit the bullet and paid the taxes on them. Okay. And rolled them into those Roth accounts. So, that’s where those dollars have come from. We just like if I might go back to teaching coaching someday, but if I do, it won’t be because.

Brian: So, there’s no automatic funding in the Roths currently.

Luke: There is in the Roth 401k. Okay. Coming from my paycheck.

Bo: So, 10% in the 401k and we’re maxing out the HSA. $100 bucks a month going to the emergency fund. Perfect. On a month-to-month basis, is there money left over? Like is there any like sort of like slush money left over?

Luke: No, we are dead at zero. Not really a lot left over. I mean, what we’re budgeting is usually going out every month. Occasionally there might be a little bit and we decide, hey, you know, we have some extra here. Where do we want to put it? But yeah, most of the time it’s.

Brian: How much of that Roth IRA was y’all’s contributions versus the custodial portion. It’s worth $52,000 right now.

Luke: I have to look back. I want to say her teacher retirement was roughly like $20,000 that got rolled into there. And then I think when they gave it to her like, “Hey, this has been set aside for you.” And transferred it into her name. I want to say there was maybe like $16,000.

Brian: The reason here’s because when I did the math on you guys, you know, we always try to save around 30%. We’d love for you to be at one-time income and y’all were around a little over $140,000, you know, if you take out the house equity. So, I was like, “Wow, they’re actually ahead of the curve.” I just wanted to know how much of that was behavior versus what was brought into the marriage because then that could work against it. But because I know it’s just tight right now and that’s what I’m just trying to figure out where the margin in y’all’s life is. Yeah.

Budget Structure and Categories (41:22)

Bo: And so on these budgeting categories you have, you’ve got $250 for entertainment and $650 for miscellaneous. Is this where the birthday presents come out of? I just want like I’m trying to understand like categorically. Yeah. How do you guys decide what the categories are together and how much goes into those categories or do you decide together?

Luke: I’ll say and I was talking with one of your guys as they were putting this together as a review that miscellaneous category is like a lot of things that we know we’re going to spend but it fluctuates month to month. So it’s like home and auto maintenance. It’s gifts. It’s Christmas. It’s, which home spending out of home and auto maintenance or Christmas? It’s like it’s not like it’s there, kind of mini sinking funds where they’re going into a separate checking account and we know actually like how many dollars we have for those various things. That was your question?

Bo: I think so. Yeah. I’m just trying to figure out like when I’m going to use the birthday present example. When there’s a kid’s birthday present, you got to go buy a gift. Budgetarily in your mind, where is that supposed to come out of?

Luke: There’s like a checking account that has gifts on it and like $110 bucks goes in there every month. She’s got like a real-time view into like this is how much money we have for gifts in this account.

Bo: Do you actually, do you use the view or is it just set up there?

Anna: I mean it’s just our banking account that I log in. And so you actually can see it and that sort of thing.

Bo: Do you like that structure? What I’m trying to figure out is, is it the structure that’s not good or the amounts that are not good?

Anna: Yes, it’s very rigid, but that is, I mean I love my husband. I think it’s good that he likes systems and he likes to have things in place. I am just not that way. And so I am type B as they come and I’m late to everything and he’s 10 minutes early. So it’s just, you know, like we’re just opposite. So I don’t think it’s like I have an issue with the system. I just kind of have an issue with sometimes how rigid he is with it where it’s like there’s $100 in there. You already spent $70 on our kids’ birthdays. You can’t get another gift. Like we don’t have any other money, we can’t flex at all. And that just yeah, that’s like, okay, it just feels exhausting. I’m like, okay, why can’t we flex, you know? And that’s what we run into like a lot of months, even just with groceries and things like that where it’s like, yeah, maybe I’m making something for a party we’re going to and I need to grab a couple extra groceries and it’s like, well, we don’t have any extra grocery money, so sorry. And it’s like, okay. It just feels yeah, it feels really rigid and I don’t like that but I just don’t know, I don’t know what necessarily could be changed. Like he said like I’m not, numbers are not my thing and I am thankful that he does it. I’m thankful that he is owning it. I think in some ways there’s become like this unintentional like power authority because because he owns it. It’s like, well, I do this and you don’t want to do it, so I’m just going to keep doing it the way that I want to do it. And it, and I wouldn’t say that that’s like 100%. He wants me to have opinions in it and he wants me to have a voice in it. I know he does, but just because of how systematic he is and how, you know, like we have to have a system for everything, it often feels like it’s like, well, his way or we’re just not doing it.

Finding the Right System (44:40)

Brian: I’m sitting here because, you know, there’s different systems. You know, Dave Ramsey has like, was it the envelope system? There is and it sounds like you’ve kind of just cordoned off in your accounts now and banks allow you to go and essentially set up funds.

Luke: We’ve got like you probably call it like a digital envelope system. There’s a bunch of different checking accounts and money is going into different accounts.

Brian: What I’m trying to figure out is what we can do to empower Anna to feel like she’s part of this. I didn’t know if it was just you give her the spending money in just straight up cash and if it’s gone it’s gone. There’s got to be something we can do to empower you on this. Y’all are doing a lot of the right things is that y’all have this joint account, but it sounds like the rigidness of the digital envelope system is. So, we’ve got to figure, and now it’s I’m going to put it on you is that you have to figure out what system will actually make you feel empowered. Is it giving a monthly budget to where you know when he just gives you the money and you’re now the CEO of the household money to where if it runs out, it runs out and there’s just nothing, you know, we can do. You can then, you know, squeeze the balloon however you want. And I can already tell from Luke, you’re not trying to lord it over anybody. It’s just you’re trying to have, you see the big picture. So that’s why we have to create a system to where y’all both feel once again connected on this.

Luke: Yeah. And that’s honestly like that was kind of my goal and intention of even just kind of like the digital envelope system and various checking accounts like hey don’t you don’t have to ask me, like go check and see how much money is in that category and if it’s there spend it and then we’ll check in on a weekly basis but her brain might not work that way.

Brian: Yeah. And because we see categories. I know how your brain works because we all see categories. Hers, that’s why sometimes giving the whole budget without the lines so she can paint outside. We should go get our own lesson when the fact that if the money’s out when it’s out then.

Luke: And that’s probably where there’s been frustration on my side is like hey we’re out of this category or you exceeded what we have for this category without like a proactive conversation about hey we need more for this thing this month. Because when it’s proactive and we’re communicating well with each other it’s like okay like we can flex we can figure it out we can usually make it work. I think that’s where we both feel missed at times. She feels like this is micromanagy. I feel like, hey, these are kind of the boundaries that we have. And if we need to color outside the lines, I just want to have a conversation about that first so that it’s not like, oh, we blew by how much gift money we had significantly. That’s kind of where I come at it from.

Brian: But does that, how does that sound to you? And I want to make sure you feel.

Anna: I think that’s valid. Yeah, just we have different communication styles, too. Like where I think he feels better about something if we talk about it three or four times and I’m like I don’t even really want to talk about it but I will talk about it once and then if I make a decision after we talk about it once I think he sometimes feels missed like we didn’t really decide about that and I’m like oh but we talked about it, you know. So it’s just those kind of differences too can like rub me the wrong way where it’s like I don’t need to talk about it four times to make a decision like I’m just going to go do this and I think he feels better if we’re like, not four. Four is probably a little much, but at least two times like, “Hey, we’re checking in on this again.” And to me, that just feels like a lot. I’m like, “Okay, I already talked to you about it.” And I think that’s like the micromanaging piece of it, too, is like I don’t want to have to feel like I have to come to you and have a conversation every single time we’re going to go over. I don’t know. It just feels like just draining. And money like in general to me, like having these kind of conversations feels like confrontational almost and like a little uncomfortable for me. And so that’s where I’m coming from where it’s like, oh, this is exhausting to me. Like I don’t, and I know they’re necessary. I’m not saying like I’m never going to have these conversations. I know they’re good and I want to communicate in a healthy way, but yeah, it’s kind of.

A Path Forward (48:35)

Brian: I feel like, and I’m going to give Luke, who knows how this all goes over, but I think you have three years to just go for it. And meaning y’all come up with a game plan of the things that a priority list of what’s important so Anna feels heard and then you said it earlier is that I’m willing to do whatever it takes to be successful. But earlier you’ve already experienced to where you got busy doing nothing. Meaning that you were working 50 hours a week doing coaching and other things and you weren’t, it wasn’t until you went and did the project management job switch that you’re like oh my gosh there’s a way to work smarter not harder and I was able to lift up. You’re going to, you need to take the next three years, do the 3D glasses so that you account for the doo-doo plan and then you got to go make it happen. You’ve got to turn this four-cylinder into a V10 so that Anna gets everything she wants and you just got to do it. I mean, I know that sounds, but as an entrepreneur and others, I think you, I saw you light up when we talked about this summer. This summer, we’re going from, so that’s what I mean. But you’ve got to also, you got to get Anna excited about these savings goals so that y’all can be a united front on this and then you just got to, we got to get it cranking. I mean, that’s the way I feel it.

Bo: What’s your date night love language? Like, let me give you example. My wife, brunch like fancy brunch, coffee, that sort of, that’s her like middle of the day. That’s her jam. What’s like your date night love language?

Anna: Yeah. I love a good brunch. I love honestly just, yeah, going out, margaritas. Okay. Tacos or brunch.

Communication Frequency and Budget Structure (50:14)

Bo: So, as I’m sitting here like hearing you guys talk, it sounds like, you know, one of the issues is, hey, we don’t communicate really well because we have different communication styles. And it sounds like perhaps even the frequency around the time like, “Hey, every week we’re going to check in on this thing. Check in on this thing.” Perhaps that’s too much. Now, we don’t know the answer because we don’t know your marriage. You guys are going to find that. But I’m wondering if there was something that you both knew was going to happen. Hey, once a month, first Saturday of the month, whatever, we’re going to go get tacos and margaritas or we’re going to go get whatever. And in this date, hey, we’re just going to touch base on these things, right? And this is going to be a little like financial check base. And rather than maybe the spending categories be like, “Hey, this month is exactly $101 for birthday gifts.” It’s like, “Hey, all right, we got this. We’re going to spend $800 bucks on kids.” Whatever that is. That’s kids birthday parties. That’s kids activities. And you just kind of know broad because I’m wondering if I were to look at your budget, I’m wondering how many different categorical items I’m seeing. I’m nervous like if we’re, and some people it’s great if to budget to the $10, $20, $30. That’s great. What I’m hearing you say is that’s not working for the marriage right now. And that’s a big issue because, you know, one of the, I imagine one of the goals on both of your lists is, hey, the thing I don’t want money to do was absolutely rip us apart. You know what I mean? I want it to be something that we use as a thing that allows us to do things we want to do and not a thing that creates a rift. So, what I’m hearing is the system right now is not working in its current form. So, we got to figure out how do we address that system? And just like I’m thinking frequency sounds like an issue and perhaps even categorically there’s an issue. But Brian already alluded to this. There’s some accountability here. If we go from all these different categorical things like, hey, we’re going to put $800 bucks in this bucket and this is for the kids and all things kids. If it’s a bigger category with a bigger number, then we do have to kind of honor that. It doesn’t matter if okay, well, this was a birthday party and this was a school clothes thing, right? Those can all be in the same place, but you do have to kind of honor that’s where the, that’s where the, so that way you both kind of get a little bit something. It’s way more macro, but it still fits inside the lines. I think one of the things you guys are going to have to do is sit down and figure out, okay, what actually works for us? Like, and this is a fun exercise to play and it might end in a fight, so I apologize for saying this, but I got a dear friend who did this. Him and his wife, they were fighting over finances. They were going back and forth and he finally, now he did this from like a bad spot, but it ended up good. He was like, “That’s it. You do it.” And he’s like, “You handle the finances.” Now, can’t tell you how many times he said that, right? But I think it’s an interesting thought exercise where if you, not actually take it over, but hey, if it was your job to be the financial CFO, how would you structure it? Like, how would you do it? Right? And I don’t know what the answer to that question is, but you guys should spend some time just talking about it. And there’s no wrong answers to this. One of the things you can’t, well, this is why that won’t work. This is why, this is why that. Yeah. Say, okay. Hey, and you just kind of figure out, right? Like, it’s not about you convincing her that your way is right. It’s you beginning to understand, okay, what works for her and you beginning to understand why his way is effective and figuring out where that middle ground is. That’s going to be the key to y’all being able to do whatever the goals are, short-term, long-term, intermediate. Right now, what I’m feeling is more of a communication issue than a dollars and cents issue. And that’s the part I think that if y’all can get centered on that, you can do anything.

The Homework Assignment (53:38)

Bo: I’ve got some homework for you guys to do in the meantime. As it relates to stepping out on your own, I do think working through the 3D glasses makes sense. Hey, what’s it like if this goes better than we expect? What do I realistically think’s going to happen? And then what’s the uh oh plan? Uh oh, this doesn’t pan out, something changes, camps change, whatever that thing is. And then I think the big thing you ought to do, and it’s great that you’re on a trip right now with no kids because this is like a time to get to do it. Have the conversation around what would actually work for both of you in terms of cadence and category. Hey, how often should we be having these conversations and realistically, categorically, what should we be talking about? Yeah, it might not make sense to talk about the $9 we spent on Q-tips. That may not be the thing. It may make sense to talk about a bigger category and you got to figure out what works for each of you and you both have to have a voice in that. Meaning you have to be willing to share, but you also have to be willing to listen and willing to hear. I think if you guys can do that, you’re going to set yourself up to be in a great spot and then we can play with some numbers and talk about how to actually get the wheels moving in motion.

Post-Episode Analysis (54:44)

Bo: Brian, I loved the conversation that we had with Luke and Anna, but it wasn’t perfect. There was some stuff I think that just as we had the conversation, it reminded me how valuable and important communication in a marriage is.

Brian: Yeah. I mean it’s funny because I was sitting here thinking, what do you say, Brian? I was like, communication. So you saying that word is that I’m worried for them. Sure. I mean because Luke and Anna, I appreciate them coming on the show. I appreciate them being so transparent. But it was very obvious to me in the beginning part of even this conversation is they’re on completely different pages. That’s right. And look, and they’re both well-intentioned. I mean, you got Luke who’s the financial mutant who’s trying to be so rigid and reach these goals, start a new business, but then you got Anna who’s like, “Wait a minute, we ought to enjoy some of this money.” And then she has some goals and then they’re dead in the middle of this messy middle. You think about they got a 2-year-old, they got a 7-year-old, they have three kids right now and this all happens so fast that I’m just worried that if they don’t kind of get on the same page with this, they’re going to feel isolated and it’s going to, instead of them working off the same sheet music and using the net worth to kind of help shape it, it’s going to feel like, you know, we got Luke with his goals and then we got Anna over here trying to live the best life and it’s going to feel very separated and that troubles me.

Bo: So from a planning standpoint, we’re going to lay out a plan. It’s going to look a little bit different than what a normal plan might look like, but at the very core of it has to be open communication. Open communication where both people are heard. So to kind of start out, one of the things we uncovered as we were diving in, and this is sort of a public service announcement. Whenever you have young kids in the household, this didn’t get to come up in our conversation, but as we followed up with Luke and Anna, we always want to make sure that when you have young kids, you have wills and estate documents in place explaining what your wishes are for your kids. As well as life insurance to make sure they’re provided for. There’s one, that’s kind of like a base level planning thing that they need to talk through. Hey, what happens if something happens to us? Where do we want our kids to go? Do we want to take care of the money? That sort of baseline, something that they need to work on. So then we said, “Okay, well, let’s think about how the numbers might actually and practically play out for them because they do have big goals.” And it became pretty clear that the one thing we know right now is the income that they’re operating on right now just isn’t working for the household.

Brian: Well, and I think the big thing Luke is hoping to go out on his own with these sports camps. You know, he has said his passion for it. His heart is there. But I got to tell you, after looking at the numbers, and we’re going to talk about the 3D glasses here, but I think because there’s some distress in the household, he doesn’t need to leave his day job just yet. He needs to kind of do both. And I know that’s probably not what he was hoping to hear. I think he was probably hoping, yeah, let’s do the 3D glasses plan. We’ll share what that means, but go ahead and plan out a structure to where you can leave your day job. We’re like, “No, I think you’re going to need to keep the W-2 job and put on your 3D glasses to work through these basketball camps.”

Bo: Yeah. And I think it’s okay because he still gets to do the camps. The thing he’s passionate about, but I think what their family needs, at least for this season, is the opportunity for that higher income. And so, we kind of said, “All right, let’s put on these 3D glasses and let’s say, okay, what’s the dream plan?” Well, let’s say dream plan between the two sources of income, we get household income up to $200,000. That sounds amazing. That’s really scaling sports camps. And then we said, “Okay, well, what’s the down-to-earth plan? We scale the sports camp some, but we still keep the W-2 income in place. That’d be a household income of about $160,000.” And then, yeah, I think they’re, and this is going to sound aggressive, but I think they’re kind of living in the doo-doo plan right now. Sort of where they are right now is not the ideal circumstance. They want to have some sort of improvement. And it’s always important to run the doo-doo plan so you know where the guard rails are. But I think realistically based on the way he was describing it, based on what he was laying out, I don’t think it’s crazy to think whether it be through scaling the sports camps or keeping the W-2 in the sports camps, I don’t think getting his income to $160,000 a year as a household is out of the realm of possibility.

Brian: Yeah, definitely. Because I mean his day job is already kind of right where the doo-doo plan is and then we’re going to count on some growth from these camps. So definitely $160,000 is probably the number.

The Plan: Goals and Timelines (59:05)

Bo: So now let’s break that down in what are the big goals and there are definitely some goals that we need to kind of address. The first thing let’s get Anna as soon as possible into a car that she actually feels, you know, comfortable and confident in driving the three kids around.

Brian: Yeah. And I want to give her some credit. She was not like she wasn’t crazy in her. It wasn’t like she was wanting some brand new, you know, the biggest thing I heard Apple CarPlay. She wants Apple CarPlay. That’s it. I think they started putting that in majority of vehicles after 2017. So, I mean, this is not the craziest goal out there.

Bo: So, she said, “Hey, something, you know, maybe a bigger SUV, Nissan Armada, Apple CarPlay.” So, okay, let’s make that a goal and let’s try to do that by the end of this year, by the end of 2026. They also said they want to go on a big trip to Italy in September of 2027. And that’s probably going to have a price tag of around $10,000.

Brian: They need it. I think that getting them away from the kids and having some time together as a couple to see, hey, what’s keeping us? What’s the glue that makes this work? Let’s get them a trip to Italy.

Bo: And then they said, hey, we also we would like to upgrade our home at some point in the next 5 years. That’s a goal. Now, the good news is they have significant equity in their current home. And so, we’re going to operate under the assumption that whatever equity they have in the current home, they’re just going to roll it into the new home. And so when we think about like a price for a home that would be appropriate in their area for their size family, we set a home price of $600,000. That’s going to be kind of the thing that we’re going to work towards. So let’s think about if we have these three goals, how do we begin to like parse out how we do that? And so, you know, step one, get the household income up to $160,000, keep the W-2 job, scale the income. Well, if they do that, that’s going to give them an additional $2,300 a month to work with. So, we got to figure out with that additional $2,300 margin, where does it go? Well, if goal number one is the car, we said, “Okay, step number one, let’s sell the current car, and we’re going to net about $5,000 from that, right?” Well, if we could allocate an additional $10,000 from the sinking fund right now, that’s going to give us $15,000 towards a new vehicle. Anna said, “Okay, I want to be in the Nissan Armada with CarPlay.” Okay. So, if we say it’s going to be a $25,000 car, we would need about an extra $1,250 every month for the next 8 months to be able to just pay cash for it. So, no car payment, no debt, pay cash. Okay. So, eight-month timeline to get to pay for a car. Goal number one, check. All right.

Brian: Right. So, we still have some extra margin of that $2,300. Let’s start talking about what does that mean on getting this couple to Italy?

Bo: Yep. So, we said, “All right, we have this. We already have the sinking fund that they’ve been saving for. So what if we take $5,000 of the sinking fund and we know we need to get $10,000. So that’s just going to require us to save $313 per month for the next 16 months. So if we can do that for a year and four months, that’s going to get us to $10,000 for the Italy trip and it’s going to get us there by 2027. So boom, check. There’s the next one. So that’s two goals knocked out without a whole lot of difficulty, right? Like not super crazy. So then we said, “Okay, how do we get in the new home?” Now, this is the hard one because this is going to take some time. And it’s going to be really difficult to know what their house is going to sell for, where interest rates are going to be. But what we do know is they do have a lot of equity in their current house. They currently have $200,000 in equity. And in eight months once they pay off the car and in 16 months once they pay off the Italy vacation, they’re going to have additional cash flow they’re going to be able to save for the next 5 years working towards this home. So, if we just assume $200,000 in equity 5 years from now, plus the additional savings, very conservatively, I think they could have about $278,000 that they could pay as a down payment on this new house. Now, as a reminder, $600,000 home. We’re going to put $278,000 on it. That’s going to keep their monthly payment at about $2,340.

Brian: Yeah. I mean, they’re pretty much putting down almost half of the purchase price down. So that’s nice that that’s keeping that payment low. And then even if you think about this, we’re running the down-to-earth plan at $160,000. This is going to keep it right in line with the 25% of housing costs as well. So they’re going to get the lifestyle upgrade in life, but they’re also still going to be very respectful of doing the 25% of household expenses for housing.

Bo: Now, the thing that you’re probably thinking, or I know that they’re going to be thinking when they’re hearing this, is, “Okay, we’re going to have an extra $1,500 a month of margin going to new savings.” But I remember the guy said we had $2,300 to work with. So, $1,500 is what we’re using, but we have $2,300. There’s an extra $700 there. I bet they’re going to say, “Okay, now we got to fund the Roth. Now we got to start saving. Now we got to start building.” I actually don’t think that’s the right move.

Operation Anna (1:04:07)

Brian: Well, this is operation Anna at this point because I mean, look, we love Roth IRAs, but I could sense that Anna needs to be the commissioner of some of this money to where she has complete 100% control and doesn’t have Luke in, you know, looking over her shoulder saying, “How are you spending this? Give me your receipts.” So, we think that of this $700, let’s give Anna $400 a month of just fun money. That’s right. Go out there, have a good time. Luke, you don’t get much accountability on this. We’re just going to let Anna live her best life for the household and let’s see what she comes back with.

Bo: And so what’s great is if we rework the budget, assuming this down-to-earth plan, you can see we’re able to fund those both short-term and intermediate term goals through the sinking fund, the $1,563, but we’re also able to fund the lifestyle, $400 a month for the other things, the happiness, the decor, the birthday gifts that randomly show up. And I think that way they both feel like they are heard and are living not just a life that’s going to look good in the future, but a life that’s going to look good today.

Brian: Now, this is kind of interesting because, you know, we love people to save and invest somewhere between 20 and 25%. Doing the math on this, they’re only going to be saving about 14%. And the way that breaks down is if you look at the 401k, they’re already putting 6% in Luke’s Roth 401k, they’re getting a 4% match. That’s where we get to 10%. We’re going to be boosting this up with the additional savings, 14%. Does this even have a chance?

Bo: Yeah. So, right now they have about $100,000 invested at age 30. If they just can hit that 14% savings rate that you outlined, it’s about $22,000 a year total going into their portfolio, they’re still on a great path. By the time that they get out to age 60, portfolio is worth almost $5 million. By the time they get to 65, normal retirement age, they can have a portfolio of $8 million. This is in a time when they were able to get in a new car, go to Italy, get in a new home, all inside of five years without sacrificing those long-term goals. Because for them, at age 65, an $8 million portfolio was the equivalent of about $113,000 of income at a 4% withdrawal rate in today’s dollars. And there’s no social security, no pensions, no nothing else. On top of that, I think it’s possible for them to have a better and more improved current day as well as a great big beautiful tomorrow. I don’t think it has to be an either or. And it sounds like in their marriage, it’s being painted as an either or.

Brian: Now, we backed into these numbers and when we came up with this 65 number, we have to bring it back to today’s purchasing power. And we did figure out, hey, this is going to be about 71% replacement ratio. Sure. And at first you might be like, well, wait a minute, how is that going to work? But realize they’re not going to have to save for the future. We’re going to have debt under control. There’s not going to be debt issues. You’re not going to have the taxes will be in a better place. So 71% could work. I think there’s a really good chance. And it’s going to let them live a happier life. And I think that this is going to be one of those things where you look back in this conversation is Luke’s going to feel like he’s getting his opportunity to at least make the jump because that’s the other thing we based this off of assuming that it just stayed at $160,000. Based upon the passion that Luke was sharing, who’s to say that we don’t jump into the dream plan very quickly and this gets even boosted up even more? We’re just trying to say, hey, no, this is what’s going to allow you to at least take some action today.

Bo: Now, I want to be clear though because and it’s worth noting you and I are not members of this marriage. And so this is a plan. This is an idea. This is a potential solution. I think what’s going to really matter for them is I want them to watch this and I want them to sit down and figure out what the plan for them is that makes the most sense. And I don’t want it to be something where listen, hey, Bo and Brian said we got to do this, or Anna says, “Hey, no, Bo.” I said, “We got it.” They have to build the plan together and that’s the only way that they’re going to be able to get on the same page moving forward.

Final Thoughts (1:08:21)

Brian: Well, this is why I mean looking at, I mean we don’t, we’re not too dissimilar to this. So, we are kind of the nerdy financial people. We have wives that we’re pretty much pulling them into being active participants in the communication. And that’s why annual meetings on the finances, annual updates to the net worth statement, they need to be creating so that way they have a cohesive plan so that Anna does feel like she’s part of this. And then Luke has got to understand that the discipline of budgeting and all that is going to be very helpful in the beginning, but at some point you got to loosen up. That’s right. And we got to get them on the same page so that two becomes one when it comes to these financial goals. I’m so thankful that you guys let us be a part of your financial life. I’m excited we get to put this plan together and frankly I’m excited to see where it goes for them. Marriage is, somebody who’s been doing this for close to 30 years now is there’s a lot of patience. There’s a lot of you got to put in the time to the communication, but just remember why you love each other. You’ll make it through this messy middle. I really do believe it, Luke and Anna. But y’all got to listen to each other and you got to respect each other and get on the same page with these financial goals so that y’all can be united and then look back and this will be one of those messy middle moments where you say, “Yeah, the days were long but man oh man were the years short but we made it through it.”

Bo: If you would like to be a guest on Making a Millionaire, you can go to moneyguy.com/apply. Or if you want to check out any of our resources or tools, you can go to moneyguy.com/resources.

Brian: Remember, money is nothing but a tool, but it is definitely something we’ve got to take, be bound ourselves in reality, but have good communication with our spouse. I’m your host, Brian, joined by Mr. Bo, Money Guy team out.