Putting Happiness Over a Bigger Paycheck

Mindy:
Welcome to the BiggerPockets money podcast show number 171, where we speak with Brandon Austin, from Rinkydoo Finance and talk about leaving a high paying job and reaching financial independence on your own.

Brandon:
Don’t try to outsmart the market. I know a lot of people, they look at market or market movements in hindsight, with Tesla right now, for example, they’ll look and say, if I bought here, I would have made $100,000. It’s very easy to look at charts, just the way charts are, you can look at them and think that way, but it just doesn’t work like that. You need to, I would say, be more practical and recognize that hindsight is 2020.

Mindy:
Hello, hello, hello. My name is Mindy Jensen and with me as always is my enterprising co-host, Scott Trench.

Scott:
Well, you’re always just so resourceful in coming up with these Mindy.

Mindy:
Scott and I are here to make financial independence less scary, less just for somebody else, to introduce you to every money story, because we truly believe financial freedom is attainable for everyone, no matter when or where you’re starting.

Scott:
That’s right. Whether you want to retire early and travel the world, go on to make big time investments in assets like real estate or start your own business, we’ll help you reach your financial goals and get money out of the way, so that you can live life on your terms and pursue your dreams.

Mindy:
Scott. I am super excited to bring Brandon in today from Rinkydoo Finance. We talked to him about the show name. We get a song stuck in your head if you’re from the late 80s and had a babysitting job. We also talk about reaching financial independence on your own schedule. We discussed leaving a high paying job. That was really interesting to me that he left a high paying job and purposely took a lower paying job, which is something I think a lot of people struggle with.

Scott:
I think that it’s an interesting take on finance and something that, hey, if you listened to this and you’re in the first part of it, you might say, oh yeah, well he lives with his parents and they paid for college and so this is a wealth building approach, but guess what, there’s a lot of people who are in similar circumstances who are not building wealth. Who are not doing it intentionally, not making a conscious choice and not maximizing the opportunity. I think this is yet another perspective that we need to address, learn from and admire, because he’s going to be building wealth and living life on his terms, because of the hard work and conscious choices that he’s doing in maximizing, I think the hand that he’s been dealt.

Mindy:
Absolutely. Brandon Austin from Rinkydoo Finance, welcome to the BiggerPockets money podcast. I’m so excited to talk to you today.

Brandon:
Thank you very much for having me. It’s great to be here.

Mindy:
Okay. Before we get into your actual money story, I got to ask you about the name Rinkydoo Finance.

Brandon:
Everybody asks me this question. There was a TV show when I was a kid that I used to watch on TV called, the Elephant Show. The theme song was, skinny marinky dinky dink, skinny marinky dinky do, which I know is a common song.

Mindy:
I love you.

Brandon:
Exactly. I wanted a name that was playful and would be, not intimidating to people that were just getting into personal finance. And so Rinkydoo Finance, it’s very playful. It’s fun. You can’t possibly be intimidated reading articles on a site called Rinkydoo Finance, with a cute little elephant as its logo.

Mindy:
That a really good idea, because there’s a lot of personal finance bloggers that take themselves way too seriously. This is intimidating stuff. You’re learning about money in many cases for the first time. So to have a, hey, this isn’t going to be mean and difficult. That’s really great. Okay. Check them out. Anyway, Brandon, let’s get to your money story now. Where does your journey with money begin?

Brandon:
Growing up we weren’t rich by any means. We always had food to eat, but we weren’t buying Xboxes or eating out all the time. I was very conscious of the limitations, my financial situation as a kid. When I started earning money, it took me a while to get comfortable with the idea of having money and being able to spend on items that I loved, and being able to travel and do things like that. It actually took a while for me to adjust my view of myself to the point where I was able to have fun with money and do things that as a kid I never did, because I was always conscious of the fact that we lived, we rented an apartment for most of my childhood and for my parents to save up a down payment, it took them years of saving up what now would be a pretty modest down payment on a house, because prices have climbed so high. I was always conscious of that and it limited my personal view of how I was able to spend money.

Mindy:
I have that problem today and my husband and I have reached financial independence. I’m still working. I make a good salary. I have a real estate agent job, I made ridiculous salary last year from real estate agenting, but it’s still really hard to part with money when you grow up frugal like that, or you have the complete opposite experience and you grew up frugal, so you cannot spend it fast enough. I find that interesting. I identify with your treatment of growing up, not necessarily poor, but not with just money to spend whenever. Okay. What does high school and college look like for you?

Brandon:
High school was pretty much more of the same, well, you know what, we did move the year prior to me going into high school. We did move into a house that my parents own. That was a step up. I wasn’t in the same environment, being in a rented apartment with messy garbage everywhere and all that stuff. It was a step up. College was when things started to change, because that’s when I got my first job. The summer after the first year of college, I started making money. That was really when I started to have a hard time adjusting to the fact that I now had money to spend, because I still lived with my parents, I still live with my parents to this day, actually. But at the time I was living with my parents and any money I earned was largely disposable income.
It was very difficult for me to adjust to spending on not so much little things, because I did have an impulse problem in terms of buying little junk food and random little things, but larger things it was tough for me to adjust to that.

Mindy:
What kind of money are we talking about? Are we $10 an hour, $50,000 over the summer?

Brandon:
No, 50,000, that would have been nice, 50,000 over the summer. No, it was $10,000 over summer, freelance writing and also working at a warehouse. And then in my second year of college was when things really started to pick up. I was making $80,000 a year as a writer. I had one really big client that would send me a lot of work.

Mindy:
As a sophomore in college?

Brandon:
Yup.

Mindy:
Did you drop out? I would have dropped out.

Brandon:
No, but what I used to do, is I would be, because I studied journalism. A lot of what we were doing was writing articles. I would be in class working on articles for work, basically working full time and in school at the same time. I was just lucky enough to have a remote job where I could do that. It was insane though, the amount of hours that I put in.

Scott:
Was this how you paid for college?

Brandon:
No. My parents actually paid for college, which huge help. My parents have helped me so much. They paid for college. Let me live with them everyday. It’s been a fantastic help for me financially. Just imagine, you’re a kid that your parents are paying for college, you’re living at home and you’re making $80,000 a year. It was just a complete change.

Scott:
That’s an awesome. Start with this. What was your financial position like when you graduated college?

Brandon:
When I graduated, it continued. I was still making $80,000 a year for a couple of years after that. The issue was, well, not so much an issue, not as big of an issue as maybe some people have, but I wasn’t necessarily thinking consciously about saving. I would spend my money on a lot of little things and whatever was left would get saved. I would always walk around with the guilt, because I knew I was making good money, the sort of money that if either of my parents were making that money when I was a kid, my childhood would have been completely different. I always had this guilt regarding, I’m spending really impulsively. I’m not keeping a whole lot of the money, when I was in college particularly. I didn’t know how to really address that. I wasn’t conscious of, okay, how do I start budgeting? Does this mean I have to stop spending money altogether? How do I approach this?

Mindy:
I want to go back to what you just said. You said I was making a lot of money and I was spending little bits and saving whatever else was left over. That’s huge. Did you recognize it at the time? Because I see that happening with a lot of people. They’re like, well, I don’t really have any money to save. You’re not trying to save. You’re not saving first and spending what’s left over, you’re spending first and saving what’s left over and that’s a huge mindset that you have to change in order to become successful with your finances, in my opinion.

Brandon:
Right. I would have points where I would think about, okay, how much money did I make in the last couple of months? And then I would think, okay, I made that much money and I only have this much just to show for it. Something went wrong along the way, obviously. The fact that it was a lot of little things made it difficult to recognize, because it wasn’t like, I was going on vacations all the time or spending $5,000 here on this thing, $5,000 on that thing. No, it was at most $1,000 on a big ticket item, once every few months and then everything else was just eating out every day, buying lots of junk food, going to the bar all the time with my friends, which was the big one.

Scott:
I think one of the big questions here is, a lot of people don’t make $80,000 in a year after they graduate college. How did you go about getting this income in the first place without a degree and not having the skills on paper to do that, to command that kind of income?

Brandon:
Right. I started freelance writing on a site called Upwork. I just stumbled into a client who was on an upward trajectory, running their own agency. They liked my writing enough that they not only kept sending me articles to write, they also made me not necessarily equal to them, but a step down from them in terms of helping to manage the agency. I had a lot of responsibility, teams under me writing and me managing their contents and managing them. I was fortunate in that I stumbled into an opportunity where people really liked my work ethic, even though I didn’t have necessarily the qualifications, but the fact that I was studying journalism did help, because they felt confident, giving me the responsibility to manage content for their agency.

Mindy:
How many hours were you working to make that $80,000 a year?

Brandon:
It was a full time job. I would be working through class, but I would of course have to take breaks to do whatever was needed in class. I was working between school and the job, 12, 13 hour days.

Mindy:
Oh, yikes. Okay. $80,000 sounds awesome, but then when you start talking about [crosstalk 00:12:22].

Scott:
That’s only his job. He’s doing that while working in college, that’s phenomenal in college. In college we have a different capability set, energy level maybe. [crosstalk 00:12:32].

Brandon:
I couldn’t do that now. I only graduated three years ago, right now I’m 24. I couldn’t do that anymore.

Mindy:
Okay. This is interesting, you, two weeks ago on, well, two Fridays ago, we released Tracy’s episode, where she has a very high salary, but she also has a lot of spending because she’s not tracking her spending. It sounds like you also weren’t tracking your spending and it was just going wherever. What we said to Tracy and what I’m going to say to you is, in your mind, you’re making $80,000 a year. Of course you can afford $1,000 on insert item here. Of course you can afford a $100 meal. Well, yeah. What does Paula Pant say? You can afford anything, you can’t afford everything. What was your turning point? I’m assuming that you had a turning point, you’re not just spending all the money that you have.

Brandon:
No. It came in two stages. First I got into investing and I realized the value of money. It wasn’t so much conscious effort to get spending under control as much as it was to transfer the energy I had about spending from buying things, to investing in what eventually became the stock market. Initially it was crypto. But it just became that mindset shift of saying, okay, I understand how much fun it is to buy things, but now it’s even more fun for me to invest. The second stage came about a year ago, for a little over a year ago, in September of 2019, when I took a pay cut because the job I was working, I realized the hours were intense. I wasn’t too fond of the people that I was working with anymore.
I won’t throw them under the bus and say that they were terrible, but it was just not the environment I wanted to be working in anymore. I ended up taking a pay cut. I was getting paid in US dollars for the original job. I took a pay cut started working locally, which even though the nominal salary was the same way, I make $50,000 now. At the time I was making 50, 60,000 US, which is why it ended up being $80,000 Canadian. Even though the nominal salary is the same, it’s a huge pay cut for me. I could no longer say, I’ll spend a bunch of money on my credit card and I know for a fact that I’ll be able to pay it off with the next paycheck, because the next paycheck isn’t equivalent to however many Canadian dollars did ultimately was depending on the transfer. I had to be, and I still have to be a lot more careful about my money, because it ends up being less for me.

Scott:
Can you take additional work on top of that to earn more money? Or is your income truly constrained now in a way it wasn’t a few years ago?

Brandon:
I can take on a side work, but I’ve used the time that I freed up instead to, I’m learning software development now, because that’s an area I want to head into, which would eventually allow me to surpass the income that I was having before. And also the work I had before was a lot of doing things in bulk, just running through so many different articles and so many different strategies. Now it’s a bit more measured in terms of my pace. I’m able to focus on doing a really, really good job at what I do now. That’s helped me, we had a meeting at work and, my boss is really happy with my progress. He’s planning on, promoting me. He laid out a roadmap for how the business is going to grow and where he wants me to be as it grows.
That in itself is going to help me surpass the income I had before. It was a measured step backwards with the understanding that it will lead to me making more money in a more sustainable way later on, which was the goal.

Mindy:
How do you wrap your mind around losing so much income? I know there’s a lot of people who are listening, who are like, wow, I hate my job. I want to leave, but what is the term Scott? Golden handcuffs?

Scott:
That’s right.

Mindy:
I make so much money here that I couldn’t possibly leave. I have had that toxic job. I have had the, I hate going to work every single day. And now I have the, I love my job, I can’t wait to get to work job. I didn’t have the pay cut involved. I was making nothing at my toxic job, which makes it really, really easy to leave something that isn’t paying so well. You took a significant step back. How do you wrap your mind around that? I do want to address that you said you live with your parents, so there isn’t the housing costs. There are some easy wins, but it’s still a huge mental shift to leave your $80,000 a year job for a $50,000 a year job. And that’s 80,000 Canadian versus 50,000 Canadian.

Brandon:
Right. Correct.

Mindy:
Right. Okay.

Brandon:
It was tough because I also, at the original job, I had the luxury of working from home. I was also able to travel a couple of times a year to the US for conferences, which was fun. And then I went to making $50,000 taking the subway, which I hadn’t taken the subway in two years, at least. It was a step down. It was humbling though. It was good, because, I appreciated the understanding that I had gotten a little cocky in terms of how much money I was making. And so the step down and the fact that I was taking the subway, waking up at six o’clock in the morning to do that, that all humbled me and reminded me, okay, you were making really good money, but you still need to be responsible. You still need to plan for the future, and nothing is necessarily going to be that easy all the time. It forced me to reevaluate my approach to not just money, but life in general.

Scott:
Did you accumulate debt in this process or was it just you didn’t accumulate as much as you would think you were capable of?

Brandon:
No debt, just not accumulating as much as I was capable of. I was making $80,000 a year for about three years and at the end of it, as of September, 2019, I had about $70,000 invested. You think about the money I was making and the fact that I had a lack of housing expenses or schooling debt or anything, that should have been a lot more, it shouldn’t have been just $70,000.

Mindy:
Well, but there’s a lot of people who are making a lot of money that should have a lot more, and they don’t. What are you doing now, now that you know that you should have had a lot more money and you don’t? What are you doing now to rectify that? Because you are on the path to financial independence, but you’re not on the path to retire early.

Brandon:
Right. Exactly. Right now, investing is priority for me. When I think about how I’m going to spend my money, the first question is, how much do I want to invest? And then everything else falls in line after that. I’m also being more pointed about using the fact that I have no housing expense. Well, I pay a modest amount of rent, it would be equivalent to renting a room and the house it’s not as nice as the one I live in. There’s an expense, but it’s negligible relatively speaking in terms of what a lot of people pay for rent in Toronto. I’m using the opportunity that I have, having reduced housing costs to get as far ahead as possible, because I know at some point I will have housing expenses. I’ll probably buy a house or be renting a property.
I want to put myself in a position where I’ve saved and invested so much while I was living at home, that even if I have to scale back when I move out, it’s not going to be a problem in terms of reaching my goals.

Mindy:
What are you investing in right now?

Brandon:
Right now, I actually use a robo-advisor, have it’s called, Wealthsimple, they’re in Canada. I used to manage my own index fund and ETF portfolio, but I just found I was overthinking things, I was constantly saying, okay, this has drifted to a larger portion of my portfolio. How do I handle this? Is this even the right index fund or ETF for me? I ended up switching to a robo-advisor.

Mindy:
And what’s a robo-advisor?

Brandon:
Basically I deposit money and it splits it up into a portfolio of ETFs based on whatever information I gave it about my goals and my risk tolerance. It handles purchasing the assets, and then it also rebalanced is automatically for me. It’s all a computer doing this stuff. It’s not an actively managed or human managed fund, I should say.

Mindy:
Okay. I think you’re doing it right with the index funds. I’m wondering if you’re looking at it too frequently for your own mental wellbeing. Scott, how frequently do you look at your stock investments?

Scott:
Every couple of weeks maybe, if I remember.

Mindy:
Brandon, how often are you looking at yours?

Brandon:
Basically every day.

Scott:
But it’s different, how long you’ve been investing?

Brandon:
I started, I want to say seriously investing in 2017. So about three years, going on four years.

Scott:
I just think when I first started investing, you checking in all the time, because even though, you’re not supposed to, you investing for the long term, you just check it all the time. Now it’s been, nearly a decade and I’m starting to ease off of, I am now able to, four levels of competence, you’ve got unconscious incompetence, conscious incompetence, conscious competence and an unconscious competence. You ever hear of this?

Mindy:
No.

Scott:
It’s like, you don’t know what you don’t know, then you know what you don’t know, then you don’t, then you know. Anyways. I just get to this point where I’m like, okay, I’m now believing and buying into and actually practicing this long term investing horizon, actually not caring if the market goes down that day, rather than knowing that I shouldn’t care, but still caring. If that makes any sense. That’s the way I feel about my investments. It’s hard to tell somebody not to check their investments every day. I got no issue with it.

Mindy:
My husband has been investing, he’s in his late 40s. He’s been investing for years and he checks it every single day and then talks about it to me every single day. Let me tell you about this.

Scott:
You guys keep talking about how you should pick stocks and invest in index funds that you keep making bajillions and Tesla and Amazon.

Mindy:
Yes, he is. But the initial amount invested in Tesla in 2012 is very nominal.

Scott:
Not nominal anymore.

Mindy:
No, it’s not nominal anymore, but that’s ridiculous Elon Musk growth. I don’t know. Don’t tell him, but I stop listening when he talks about Tesla.

Brandon:
I look because it’s entertaining to me, seeing the movements, for example, in March of 2020, I was losing quote unquote, because you don’t lose until you actually sell, but I was losing thousands of dollars a day. It was never a question of, okay, should I sell? It was always just, wow, the world’s burning. My stock market portfolio was the least of my concerns at that point, given everything that was going on. It was almost a source of Catholicism to watch the money sort of, the value dropped so much because everything else that was going on in terms of the health risks seemed so much more concerning to me.

Mindy:
That was going to be my next question, with you watching it all the time and being a relatively new investor. Did it freak you out? When that started, we had an episode where we interviewed five early retirees and Brandon, the mad scientist was one of them and he is so stoic in real life, but he came on the episode and said, “I thought that I’d be cool with a big drop, but when that big drop happened, it turns out I’m not so cool with it. So I’m writing down my feelings now, I’m not taking any immediate action, but I’m writing down my feelings now. And when the market recovers, or in a few months, I will revisit how I felt and rebalance my portfolio stocks versus bonds based on that from a position of clear headed newness.” And I was like, that’s the Brandon that I know.

Brandon:
Right. That makes sense. I had the benefit of coming from investing in cryptocurrency before.

Mindy:
You’re used to huge drops for no reason whatsoever.

Brandon:
Yeah, exactly. Because in crypto, when something drops, a lot of these projects anyway, they have no real backing or in terms of intrinsic value to them. When they’re dropping, you have absolutely no reason to be confident that they’re coming back. When I was watching VTI drop, it’s like, that’s the total US stock market that’s dropping. It’s not going away. It’s not a cryptocurrency project that’s falling apart and it’s never going to resurrect again, because the whole thing was just based on nothing anyways. I had the benefit of that.

Scott:
Brandon, what are your financial goals? Are you striving for financial independence?

Brandon:
My big goal is to retire, or have the option to retire by 50. Now I know, I’ve had some conversations on Twitter with people who say that’s a long time, don’t you have any desire to do it sooner? My thing is, at least now I enjoy working and I find fulfillment in getting up and doing something every day. I don’t see myself retiring in the sense of quitting my job and, doing nothing. I do want to have the opportunity to do that at 50, because I don’t want to be beholden to something at a point in my life where the tide turning, getting jobs is not going to be as easy necessarily as it will be, now and for the next few years.
A lot of that comes from observing family members and the situations they found themselves in financially where they didn’t really like their jobs. They would have loved to make changes, but they were in their 50s and it’s very difficult to do that, and they have mortgages and things like that where they can’t do that. That’s why I chose 50 as a target for achieving financial independence.

Mindy:
Yes, yes, yes, yes, yes. Okay. I hear from a lot of people who are like, “I want to quit my job in five years.” Why five years? “I hate it.” Okay. Then maybe start looking for a different job. But you don’t join the financial independence, retire early movement because you hate your job. That’s why a lot of people do, but that shouldn’t be the driving force behind it. You are pursuing financial independence and should retire early happen, that’s great, but you’re not even retiring early. There’s a lot of people we talk to Scott, in their early 20s who were like, I got to retire before I’m 30, or I don’t know life will end or whatever.
It doesn’t have to be that way. There’s a lot that you get from doing a job that you feel you’re contributing to the world, stamping out cogs that a piece of metal may not feel something that you’re contributing to the world and you’re doing good. Having a job where you’re actively contributing to the betterment of society makes you feel good. And that when you are financially independent, you can work whenever you want. It shouldn’t be about quitting your job as soon as possible. I love that your financial independence goal is 25 years down the road. We’ve talked to a lot of people who’ve done it in 10 years, fairly easily.
It’s not this mad dash towards financial independence where you’re so frugal, you get no enjoyment out of life and you’re sucking away every penny you can possibly suck away because you have to get there as soon as possible. I love the mindset behind it that you’re not, I’m going to continue doing the things that I’m supposed to do while also being a member of this group that is weird, for weirdos.

Brandon:
A lot of that perspective, I think too came from the fact that, when I was making $80,000, and even now, I’ve always been able to navigate the professional world and knowing that, if I lost my job tomorrow, it wouldn’t be a catastrophe because I’m fortunate enough to live with my parents. I’ve navigated the world in that sense, and I want to maintain that. That to me is the financial independence I want. I want to be able to navigate the professional world, making decisions, taking risks, maybe even taking pay cuts, to do work that I feel is more positive and meaningful. Those are the options I want to have. It’s not just being on a beach. It’s being able to navigate the professional world without the same constraints that someone who is either they keep this job or they can’t make a rent or their mortgage, without the constraints that someone like that has that, that’s my goal in terms of financial independence

Scott:
On this point, when you stretch yourself and maximize your income potential, this is how most people I think, approach their careers at the beginning especially, is they go from the very highest paying job or the best combination of total compensation that they can get. That means that they are at that point maxed out, that is the best income situation that they can develop personally. And then they spend basically all of that money or do not accumulate. We’ve talked to so many people we’ve talked to millionaires on the show who have less than one month in emergency reserve. All of their money is in retirement accounts and their home equity. So they have no freedom, right?
That’s the key here, is again, there’s a spectrum along this journey and what you were positioned allows you to do. You’re living with your parents, but also having maximize the hand you were dealt by playing it so well and attacking it so vigorously in college. You are not maxed out on your income front. You’re able to make a decision that is better for your mental, emotional, physical wellbeing, and still allows you to build wealth and put yourself in that position. And that gives you freedom, flexibility, options, forever. It’s not like going after the biggest paycheck, isn’t also the best opportunity or the best thing for you in some cases, in some cases it is.
But I think that people who do that place themselves at a higher risk of being unhappy with their work or their life on a day-to-day basis, because they have no other option. Their spending change them to that job, regardless of whether they ultimately like it or not. And it becomes a stressful or whatever. That’s when people want to quit their job, is because regardless of their income that they get, a middle-class America, average Joe, always tends to end up spending just the amount that he earns on an after tax cash basis. Whenever it hits the bank account, it goes out. That is the freedom constricting thing that, I think you were setting yourself up wisely to avoid for life, the way you’re handling things. It doesn’t mean you won’t ever have a stressful job, but you’ll never be chained to a stressful job.

Brandon:
I like what you said there. Yeah, that’s good. It’s not necessarily avoiding stressful job. It’s just weathering that stress, knowing that, if it falls apart, it’s not the end of the world.

Scott:
I’ll tell you, it’s stressful being CEO sometimes, you got to make decisions that impact people’s lives and there’s a lot of scale with this. It is stressful. I’m not dependent again on the income from the job to stay in my lifestyle in general, which allows me to say, as bad as some days get, the good and the overwhelming awesomeness of this job make me want to do it intrinsically for the value of it, in and of itself. And that’s the position that I think it’s worth fighting for and defending for lifetime and sacrificing and grinding out to get there.

Mindy:
Okay. I am listening to people listening to this episode right now saying, but he lives with his parents. He lives with his parents. He doesn’t even have any bills. Okay. He’s made a smart choice. You could absolutely have gone out, sophomore year in college, pull the Mindy and been like, I’m out. I’m going to go make $80,000 a year and go get your own apartment and spend all your money and be in a far worse financial position. First of all, let’s address the fact that you do in fact live with your parents. Do you have a timeline for moving out into your own apartment? You said you lived in Toronto, aren’t shacks a million dollars? It’s a really expensive real estate market.
You could drive over the border and go live in Detroit, which is slightly less expensive. What are your housing plans in the future and how are you making financial decisions now to help mitigate those in the future?

Brandon:
I would to move out by 30, which is another six years done. The reason I have a longer timeline. It’s twofold. Number one, living in Canada, if you want jobs, especially in the media industry, which is where I work, Toronto is where you live. It would be like moving out of my parents house in Toronto to buy another place in Toronto, just for the sake of it, as opposed to having the option of moving to a different city, which of course the option is there, but the job opportunities is not going to be the same in say, Vancouver or Ottawa or somewhere else. It just doesn’t really make practical sense to rush into it in my opinion, anyways. I’m also conscious of the fact that, money I’m able to save and invest now is going to be worth a lot more, 20, 25 years from now. And so I’m trying to get as much saved and invested as possible. So that when I do put however much down payment on a house, it’s not going to be a huge trade off between investing and losing out on all that, that money.
One mistake I have made was, I would put all of my money in my retirement account and also in my tax free savings account, which is, I believe the equivalent of an IRA in the US. I was earmarking all of that money for retirement savings. And so things like, buying a car, which I did for the first time in September of 2020, and then also a house down payment, even though the money for both of those things is there. It was just never really allocated in my mind as that may potentially be for housing. What I’ve done now is I’ve actually set up separate investment accounts and savings accounts for a housing down payment so that I won’t have to pull money out of retirement. There are programs that will allow you to do that in a tax favorable way, but I want to avoid that. I want to keep that money for retirement. And so now I’m being more conscious about saving specifically for a house down payment.

Mindy:
Okay. Let’s look at your plans. You said you want to move out by 30. What if you get married?

Brandon:
That is a great question. A few people on Twitter that I’ve interacted with have pointed out, things can always change. Even my boss mentioned, I was outlining my plans, and he mentioned, there’s just one problem. You might get married and have kids. This could derail everything, which that’s a very real possibility. It’s not something on the radar, but I would have to adjust my plans for sure.

Mindy:
Okay. I can hear people yelling, well, of course, he’s going to be able to be retired early when he’s living with his parents till he’s 30. Brandon is making a conscious decision to reduce his housing costs. Hey, does anybody else recommend reducing your housing costs? How’s hacking, Scott, what is your three tenents of your set for life book, reduce your housing costs? Brandon’s making a conscious decision. Is that what everybody wants to do? No, but Brandon is choosing this, so good for you for choosing. Just because you want to move out, I think I’ll move out when I’m 30, doesn’t mean you’re not going to do it when you’re 27 or 25 even.
But having these plans, thinking long-term, I think is really important. I think a lot of people are like, I can’t wait to get out. I wonder if it’s a difference, Canada and America are kind of the same, but also way different. I wonder, do more people in Canada live with their parents, or is this just a conscious decision you’ve made that’s different? Because in America, soon as you hit 18 and you’re like, I got to get out. Got to get out.

Scott:
I would just disagree and I say, I think a lot of people live with their parents in America. I don’t know if there’s a difference.

Mindy:
I was living with my parents til I was 26. I was not saving lots of money and I sure wasn’t making $80,000 a year doing it. But if I was, I think I would have moved out.

Brandon:
I don’t think there’s a huge difference in terms of Canada and the United States, but culturally, my parents are from Guyana and so culturally, it’s very normal to live with your parents until you’re married. It’s just expected, unless you’re moving countries for jobs or something like that. Culturally, it’s just a given that that’s what you do. The other thing, I think about how wealthy people approach money in terms of keeping it in the family and helping the entire family unit progress. To me, I have this comradery with my parents in terms of, I know where we started, was just renting, not the best department in the world, and to see them move up to owning their own property. Now I have a sort of, I feel responsibility to see them to the end of paying off their mortgage and reaching a place for themselves where they’re financially stable.
I would rather pay them the small amount of rent and help them with odd things here and there, than to give someone else like a landlord that money. To me, I want my family to progress. And so that’s another big reason why I’m staying at home. Once my parents have their mortgage paid off and they’re retired, the incentive in that regard is going to disappear and it’ll be, I’ll feel I’m encroaching on their freedom and so I’ll be more inclined to leave. But until then I feel I want to help. Also conscious of the fact that they helped me pay for school, even though they didn’t have to, because I had the money to do that. It was just, they culturally felt the responsibility to do that for me.
I want to, not just leave as soon as possible and enjoy the benefits of them letting me stay here and paying my tuition without actually giving something back to them.

Mindy:
I think culture has a lot to do with your experiences with money growing up. It affects your relationship with money for the rest of your life. Culture is not something that you should try to overrun because you’re never going to.

Brandon:
Right. Exactly.

Scott:
I think that makes a lot of sense. And I think a lot of folks who live with their parents are not doing so out of a conscious decision to build wealth intentionally, moving well past what I imagined to be the six figure mark, in terms of personal net worth with no debt and aggressive accumulation and long term outlooks there. A lot of people I think, are doing that out of a state of dependency on their parents, which does not seem to be the case with you. I think that it highlights an interesting option available and maybe a cultural stigma know that needs to be addressed, because it’s not a bad option. It’s a great option and it creates a tremendous amount of freedom down the line.
In your case, I love the perspective that you’re actually helping your parents pay off their mortgage, is how you’re viewing the relationship, not as part of that. It sounds that’s a really healthy joint view on the matter.

Brandon:
Right. Because that money would just go to a landlord and it would make someone else rich as opposed to helping my own family become rich, is the way I look at it.

Scott:
I love it. Well, should we move on to the famous four Mindy?

Mindy:
We should, I think this was really fun. This was just yet another money story and a different perspective that we haven’t yet shared. I love sharing every money story, like I said in the beginning. Okay. Brandon, it is time for our famous four questions, is the same questions we ask of all of our guests. Number one, what is your favorite finance book?

Brandon:
There’s a book called, I Will Teach You To Be Rich by Ramit Sethi. That was the book that really brought everything together for me, because it showed me that it was possible to have fun while investing and saving money. It also made investing very simple because he was the one that got me into index funds. I, 100% recommend that book. I’ve given it to people. I’ve said, I’ve told people, you must read this book if you want to learn about money, but you don’t want to learn about how to read stock charts and stuff like that. That’s my favorite personal finance book.

Scott:
If you’re interested in hearing, Ramit, we’ve actually had him on twice now, and we’ll look up those episode numbers here in the show notes.

Brandon:
Very cool.

Mindy:
Ramit last joined us back on episode 127. Then he also joined us-

Scott:
On episode 73.

Mindy:
On episode 73. He’s a delight to talk to. His book is fabulous. Because he teaches you, like you said, it doesn’t have to be complicated. It sure can be, if you want to make money as complicated as possible, buy individual stocks and do the crypto and do the everything’s. But if you want to make it easy, put it in an index fund, Vanguard total stock market index fund. Fidelity total stock market index fund. I prefer Fidelity over Vanguard, but that’s another story.

Brandon:
It blew my mind to hear that, this is a millionaire author. He’s made a bunch of money and to read him, say that, he just puts his money in index funds and doesn’t really pay attention to it. It just blew my mind because my understanding of how rich people handled their money, at the time, it was completely different. I thought, they’re picking individual stocks or they have money guys that they give their money to them. I’m sure a lot of them do, but to hear him say, that was like, oh wow, this is a thing.

Scott:
That’s the way to build wealth there. But I also want to caveat that at the end of the day, if you want to build that next level of wealth, to get to a millionaire and financial freedom, index funds, saving, the basics, these types of things, being disciplined, but he has a business, he has books. He has all these other assets and those types of things, which allow for that conservative approach to have that much more compounding effectiveness as well. Just know that at some point that accelerated piece comes in with it. But yes, I love that book. I love Ramit. I love debating with Ramit. He came on the show, we did a negotiation about salary on episode 73, it was fun.

Brandon:
Nice.

Scott:
He ended up getting a template where he could earn into a raise from me on the show. All right. What was your biggest money mistake?

Brandon:
I would have to say how I handled cryptocurrency, which I got very greedy. At the end of 2017, I had about $100,000 in crypto. No, it was sometime in 2018. I had about $100,000 in addition to a substantial amount invested in the stock market. But I was thinking, okay, crypto is going to make me a millionaire. I’m not going to really withdraw that money. I’m going to leave it there. It’s going to keep going up forever and I’m going to become rich, which of course didn’t happen. That was a big turning point in terms of understanding how to invest more wisely. I became a bit more conservative. That was probably my biggest mistake in terms of pure dollars lost.

Scott:
We got to get somebody on here to talk about Bitcoin and cryptocurrency, generally. Bitcoin specifically around this, because I think it’s time that the skyrocketing price of it, I think matters. I will say, I don’t think it’s a currency. It’s an alternative to the dollar. It’s an alternative to things like gold and those types of things. It could, if the dollar inflates become a currency used by some people, or maybe even a lot of people, one day out of the sea of currencies there. Is it an investment? Would I save my money and stock pile it into gold or dollars in order to retire?
I don’t know, but I want to have this debate, because I think that there’s a lot of misinformation and a lot of you’re going to see volatility in the crypto markets over the next couple of years, and it’s going to be a wild ride, who knows where it ends up. But I think that’s an interesting discussion. So your biggest mistake is crypto, it sounds like you put a lot of money in and sold at the bottom, is what I’m gathering.

Mindy:
Well, no.

Brandon:
Well, no.

Mindy:
He said he had $100,000. How much did you put in?

Brandon:
I put in 20. I made good money. I wrote it all the way up to the point where the portfolio was about $100,000 and then I wrote it all the way back down. Well, I did cash out some, so it would have been a bit more than $100,000. I took out some and I was left with $100,000 and I rode it all the way back down to $30,000.

Mindy:
That’s a wild ride.

Brandon:
Yup.

Scott:
It’s an opportunity cost of not selling high, basically what you are saying.

Brandon:
Exactly. And just the amount of energy and time I spent thinking I’m going to become a millionaire from this, which probably fueled other bad financial decisions, which weren’t major, but just an overall lack of care because I thought I was going to be a millionaire. And so that was an overall mistake, I think.

Mindy:
I still think you’ll be a millionaire.

Scott:
Yeah. I agree. I think you’ll definitely be a millionaire. I think your fundamental mistake is not that specifically, but the lack of an investment philosophy generally, that you could adhere to you over the long run through ups and downs, regardless of whether that includes crypto or not. I think that it was like, that’s really high and now it’s really low, whatever. It didn’t speak to me that there was a 30 year or 50 year outlook on the planning around the money management in this case. Is that right?

Brandon:
Right. That’s a good point. It was just going along with what I thought was going to make me rich in a very short order.

Mindy:
Okay. What is your best piece of advice for people who are just starting out?

Brandon:
The best piece of advice would be, don’t try to outsmart the market. I know a lot of people, they look at market movements in hindsight, with Tesla right now, for example, they’ll look and say, if I bought here, I would have made $100,000, and it’s very easy to look at charts. Just the way charts are. You can look at them and think that way, but it just doesn’t work like that. You need to, I would say, be more practical and recognize that hindsight is 2020. That’s my big advice to anyone getting started.

Scott:
I’m sorry. I keep jumping in on this, but I feel when I started investing, I tried to time the market and beat the market and pick these little stocks and figure out where the value lies, the temptation is yours is irresistible. It is, especially for someone who’s just getting started with your first 10, 20, $50,000, where that seems like, I could just multiply this by 10 fold and I’m done. And so the thing is, index fund investing we know is mathematically a superior alternative for most, but if you can’t resist a better middle ground than attempting to do something timing the market or beating the market or crypto trading is likely going to be approached by a guy named Peter Lynch, who wrote, One Up on Wall Street, which allows you to begin doing something closer to what Andy’s husband does, in selecting stocks that you think are likely to increase in value over the long run.
The reason for that is that it’s still, you’re probably not going to beat the market, but at least you’re going to be closer on average to that index fund performance, with an approach like that than you will by attempting to do this trading mechanism stuff that you’re doing with crypto. I just think it’s phenomenal advice and would just say, there is a middle ground if you feel it’s too boring and you’ll be too antsy, if you don’t get some chance to at least attempt to flex your mental muscles and invest in something.

Brandon:
I have to read that book, because I haven’t paid too much attention to the middle ground. I was just went all the wave to the other side and said, indexes are the only thing you need to think about. I have to pay some attention to that.

Scott:
I dump almost all our money into index funds at this point, just to say, but I think that the One Up on Wall Street or that approach of thinking about a couple of stocks to invest in long term for value, if you can’t resist, is maybe a middle ground for some.

Mindy:
Well, let me give you a glimpse into Carl’s day, he wakes up and he reads 57 business journals, all about tech. He’s not reading about the automotive industry except Tesla, because it’s tech related and he’s obsessed. But he’s not reading about the automotive industry. He’s not reading about the boating industry. He’s not reading about port bellies, all this stuff doesn’t matter to him. He only reads tech, but he reads everything about tech and he didn’t start today. He started 20 years ago and he’s been reading about, Apple has this new thing coming out where you can listen to music portably in a different way.
That’s cool. Wait, they’re making a phone, why would a computer company make a phone? That’s so stupid. And then you read more about it, it’s all these little bits of information that pile up. If you want to invest in a sector or a couple of sectors, know what it is, do a lot of research, do a lot of reading. I said, I’d give you a little glimpse of his day. He wakes up, he reads 57 different articles. And then he goes onto the bigger internet and reads the more mainstream news articles about those same things. He listens to podcasts. He listens to the Tesla podcast. He listens to the Motley Fool podcast. He listens to all these different viewpoints and he’s constantly educating himself.
It sounds he’s done really, really well with Tesla, but he bought it eight years ago, almost nine years ago when it was nothing. When it was just this random little company, I don’t even know what their stock price was, a dollar? He didn’t invest. And that’s another thing. He didn’t put the whole firm on this one stock. He’s like, I wonder what’s going to happen with this, I’ll try it out. Facebook came out and he’s, I’ll try that out, because everybody knows on Facebook. There are things you can think of that can help inform your decision, but you don’t just jump on a hot stock tip.

Scott:
That’s right. I don’t do that by the way with my investing. What I do, all day, every day is think about BiggerPockets. I think about BiggerPockets. How do we grow BiggerPockets? How do we get the right people in BiggerPockets? How do we come up with the next strategy or the next money show or the next podcast? I’m just always thinking about that stuff. And so most of my energy and attention goes into that and just know yourself. If you’re going to go into stocks, be like Carl, or if you’re going to approach it to something different, approach it like Mindy and I, where we pour ourselves into the investments or businesses or agent work or whatever it is that that is the true level of wealth.

Mindy:
There’s no one right approach, but there’s a whole lot of wrong approaches. Make intelligent choices, not just hot stock tips. Okay. Scott, ask about the joke.

Scott:
All right. What’s your favorite joke to tell at parties?

Brandon:
This is a tough one for me. I knew it was going to be tough. I’m a situationally funny guy. I don’t want to have a particular go-to joke. It’s if something funny happens, I’ll be able to make the whole room laugh by my snarky comments about it. I’m not sure if that’s a good answer.

Scott:
I’ve got one today. If you don’t have any.

Brandon:
Yeah, by all means.

Scott:
When I was doing some electrical work at my house this last week, my wife was shocked to find out that I am not a very good electrician. All right. Where can people find out more about you, Brandon?

Mindy:
Wait, Scott, did electrical work? I have a better, more in line with these show joke, with our Canadian guest, what has antlers and sucks blood? A mosquito.

Brandon:
Nice. Canadian approved.

Scott:
She’s has a whole herd of these jokes.

Mindy:
Oh God. Okay. Now, we’ll do the last one. Brandon, where can people find out more about you?

Brandon:
I’m on Twitter @rinkydoofinance and also rinkydoofinance.com

Mindy:
I am going to say thanks so much for getting that song stuck in my head, because I haven’t heard that song since I was babysitting in high school and it used to stick in my head all the time when I was babysitting him, and now it’s going right back again. I can’t remember a lot of things, but I can remember some horrible kids song from the late 90s, early 90s, Late 80s, oh my God, I’m so old. Oka. Brandon, thank you so much for your time today. This was a lot of fun and we will talk to you soon.

Brandon:
Thank you so much for having me. I had a blast.

Mindy:
Scott, that was Brandon from a Rinkydoo Finance. What’d you think of the show?

Scott:
I thought it was great at that. I thought that he had a unique perspective on finance. Sometimes we hear stories about, like Tony Gayden, right? Who went from 400 pounds to 215, 30,000 in credit card debt to half a million dollars in net worth with a real struggle that went through an inflection point and having to deal with all these challenges. You have this Herculean story. Guess what, not all of us start at that point and have that hero’s journey with some of those things. Brandon is, I think an example of what I think is very normal and going on here, but not discussed a lot in our society.
Guess what, he has a great money story. He’s making conscious decisions. He’s a hustler. He’s maximizing the hand that he’s been dealt and he’s maximizing his opportunity and freedom in life downstream, by making a conscious decision to live with his parents. I think we should normalize that discussion and say, this is a tool or a process that’s open to a lot of people that I think is a very valuable and positive way to build wealth and something to be admired.

Mindy:
Absolutely. I think it’s great that he’s living with his parents. Toronto real estate is horribly expensive. I’m not kidding. You could maybe get a shack for a million dollars, but you’re also competing with a lot of other people for the privilege of buying an uninhabitable dump for a million whole dollars. That’s a lot of money in my opinion. Tony Gayden. Excellent story. What?

Scott:
The uninhabitable dump in Toronto for a million dollars. You’re going to get us in trouble.

Mindy:
Well, okay. Yes. Please send all the pictures of your amazing property that you were able to buy in the last four months in Toronto to [email protected].

Scott:
Fair enough.

Mindy:
I’m only going to give out Scott’s email from now on. The episode that you referenced, Tony Gayden is episode 21. It’s a great episode. If you haven’t listened to it, you should go back and listen to it. We should get out of here, Scott.

Scott:
Let’s do it.

Mindy:
From episode 171 of the BiggerPockets money podcast. He is Scott Trench. I am Mindy Jensen, giving one last shout before we’re out.