Afford Anything

Category: Episodes

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#517: Should I Raid My Retirement Plan to Buy Real Estate?

Kimiko is dismayed that the asset allocation books she’s read led her down a path to an underperforming portfolio heavy in ex-US stock investments. Where should she go from here?

Julie and her husband dream of owning a vacation rental in the Denver area even though the math doesn’t add up. It seems like everyone around can make it work though. What’s missing?

Casey is excited to build his real estate portfolio and purchase his third rental property. He’s also worried that his plan to fund the purchase with his 457 Plan is flawed. What should he do?

Former financial planner Joe Saul-Sehy and I tackle these three questions in today’s episode.

Enjoy!

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#516: Dr. Brian Klaas: The Secret to Financial Resilience

Have you ever wondered how small, seemingly insignificant actions can have massive impacts on your financial life?

In today’s episode, we talk to Dr. Brian Klaas, a Professor at University College London and an affiliate researcher at the University of Oxford.

He explains how our decisions can lead to unintended and unanticipated consequences.

He describes why resilience is more important than efficiency when it comes to protecting your investments and career from unexpected shocks.

You’ll learn how to tell the difference between predictable problems and those that are full of uncertainty, giving you a new way to think about your decision-making process.

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#515: Q&A: Sell Your Home or Stay Put?

Jessica and her husband are juggling two home sales and one home purchase within the next two to four years. How do they execute wisely while navigating a tight real estate market?

Zerai works two jobs that both offer a pension and retirement plan. Can he take advantage of everything at his disposal or must he make some tough choices?

Emily and her husband bought their home a year ago. But a national builder tempts them to sell and upgrade using a 3-2-1 buydown mortgage. Should they do it?

Former financial planner Joe Saul-Sehy and I tackle these three questions in today’s episode.

Enjoy!

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#514: Why the Latest Economic Report is a Rorschach Test

The S&P 500 hit a record high — and the GameStop guy is back, and he now owns 9 million shares of GME, making him the 4th largest shareholder.

Interest rates from remain the same, and are expected to hold steady until September. Inflation remains unchanged from last month.

Last month we saw a massive explosion of new jobs, at 272,000  — nearly 90,000 more than predicted. But we also saw unemployment tick up, which created mixed signals.

Learn the implications of the latest economic news — and how it impacts your wallet — in this month’s economic update.

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#513: Bachelorette Star Jason Tartick: The Truth About Financial Infidelity

Jason Tartick, a former banker and TV star from The Bachelorette, discusses finances in relationships. He describes eight crucial questions about money that every couple should discuss.

When a couple is dating, but before they get serious, he says, each person should divulge their debt-to-income ratio. This is your monthly debt payments divided by your gross monthly income. Keeping this ratio below 30-40% is crucial for financial stability. Banks consider this when approving loans.

Couples still in the dating stage should also discuss their credit scores.

If you’re thinking about becoming serious with someone, you need to understand their history with debt, and their attitude towards debt, since you’ll likely be co-borrowing together if the relationship lasts.

A couple with a good credit score can save around $100,000 on a $300,000 mortgage over 30 years.

Couples should avoid shaming or blaming each other during these money conversations, he says. The goal is to understand each others’ financial attitudes, habits and history — not to point fingers or make judgments.

After marriage or lifetime commitment, Jason emphasizes the importance of having both individual and joint bank accounts. This allows each person to enjoy autonomy, while also contributing towards shared expenses. Regularly reviewing your net worth as a couple provides transparency and helps avoid misunderstandings.

He also talks about financial infidelity — what is it, and how can you spot it?

Finally, Jason encourages couples to discuss spending habits, in order to understand each others’ values and goals.

Here’s a great question to ask your boyfriend, girlfriend, spouse or partner: “If you had an unlimited budget, what’s the first thing you would you spend it on?”

The answer reveals the persons’ priorities.

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#512: Don’t Let One Big Bill Blow Up Your Budget (Here’s How)

An anonymous caller who received a large inheritance feels paralyzed by all the investment philosophies he’s read about. How does he pick a winning strategy he can stick with?

Josh is an expectant dad looking to buy a bigger house but doesn’t know how much everything will cost. Should he save more or invest more?

Another anonymous caller worries that large expenditures like buying a new car or replacing her home’s roof will blow up her budget in retirement. How does she plan for unexpected expenses?

Former financial planner Joe Saul-Sehy and I tackle these three questions in today’s episode.

Enjoy!

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#510: How to Master the Psychology of Persuasion, with Michael McQueen

Maybe you’re trying to convince:

– Your spouse | to embrace the FIRE movement.

– Your teenage kids | to invest some of their summer job money in stocks.

– Your neighbor | to sell you their house in a private, off-market deal.

– Your boss | to give you more vacation time.

– Your client | to pay you more.

Today’s episode is about how to change minds, build trust, navigate conversations, and influence and persuade others.

We chat with Michael McQueen, a social researcher, strategist, and the author of 10 books.

He’s spoken alongside Bill Gates, Apple co-founder Steve Woznick and Dr. John C. Maxwell, and was named Australia’s Keynote Speaker of the Year. His latest book, Mindstuck, focuses on how to be more persuasive.

Here are some of the ideas we cover:

Stubbornness: We tend to be stubborn because of our inherent desire to protect our existing beliefs and identities. This is partly due to the fact that the human mind has a tendency to make quick judgments and resist challenges.

Logical Fallacy: People often rely on confirmation bias and tribalism when evaluating information. We tend to favor information that aligns with our existing beliefs and groups we identify with.

Complexity over Extremes: When presented with opposing viewpoints, exposure to extreme viewpoints can – counterintuitively – make people more entrenched in their own beliefs. Introducing complexity and nuance can foster a more open-minded approach.

Here are some of his tips:

Uncover the Hidden Fear:

We often hear people resist change. But McQueen suggests a deeper truth: people fear losing something valuable. This could be certainty in their beliefs, a sense of control, or even self-worth. When someone seems stubborn, recognize it might stem from fearing a loss like this.

Address the Loss Aversion:

Instead of just highlighting the benefits of change, acknowledge potential losses people might associate with it. Can you reassure them or show how the change won’t diminish their power, security, or self-esteem?

Use “Right and Reflect” to Get People Talking:

This technique helps people reflect on their own reasons for change. Here’s how:
• Ask about willingness to change: Use a 1-10 scale, with 10 being most willing.
• Reflect on their answer: Listen to their response and acknowledge their hesitation (e.g., “Sounds like a 3 out of 10. What concerns you?”).
This simple approach encourages people to explain their resistance, potentially revealing underlying fears. You can then address these concerns directly and work together on solutions.

Build Rapport and Choose the Right Moment:
Trust and rapport are crucial, especially in formal work settings. When facing disagreements:
• Acknowledge the awkwardness: Let the other person know you understand the conversation might be difficult.
• Start with humility: Avoid being overly assertive. Show willingness to hear their perspective.
• Choose the right moment: Not all times are created equal. Pick a time when both parties are calm and receptive.

Frame Your Message for Impact:
The way you present information can significantly influence how it’s received. Here are two effective framing tips:
• Align with values: Use language that resonates with the other person’s values and moral foundations.
• Focus on the positive: Highlight positive aspects of the person or situation when giving feedback.

Move Beyond Persuasion and Focus on Progress:
The ultimate goal shouldn’t be to win an argument or force someone to agree with you. It’s about creating a space for open communication and exploration.

• Focus on progress, not victory: Changing minds is a gradual process. Celebrate small wins and focus on making sustainable progress together.
• Be open-minded and collaborative: Be open to considering the other person’s perspective and work collaboratively to find solutions.
• Avoid manipulation: Ensure your goal is to benefit the other person, not just yourself. True persuasion comes from a place of genuine interest in helping others grow and improve.

McQueen elaborates on these tips in today’s podcast episode. Enjoy!

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#509: “I’m Retiring at Age 34 and a Half!”

Rob wants to retire early, but a real estate investment led to $30,000 of credit card debt. Should he take on more debt to pay it off?

An anonymous return caller took Paula’s advice and ran with it, doubling her income within a few years. Should she update her investment strategy now that she’s in a higher tax bracket?

Humaira is tired of paying rent with nothing to show for. Can she leverage some benefits by using her credit card to pay the bills?

Former financial planner Joe Saul-Sehy and I tackle these three questions in today’s episode.

Enjoy!

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#508: Stanford Researcher Dr. Mary Murphy on How to Cultivate a Growth Mindset

Recently I chatted with Stanford researcher Dr. Mary Murphy, a renowned expert in the field of psychological and brain sciences.

Dr. Murphy, who is a Professor at Indiana University and conducts research at Stanford University, shared insights into the concepts of fixed mindset and growth mindset.

We deep dived into her extensive research on how these mindsets impact motivation, performance, and relationships at work and home.

She conducted research alongside legendary psychologist Dr. Carol Dweck, who created the original studies around fixed vs. growth mindset.

If you’ve ever read about fixed vs. growth mindset in the past, you’ve undoubtedly heard of Carol Dweck, who is legendary in the space. Dr. Dweck mentored Dr. Murphy at Stanford, the university from which Dr. Murphy received her Ph.D.

Dr. Murphy’s insights can help you cultivate a growth mindset to overcome challenges and achieve your goals.

If you want to improve your performance — at work, at home, at the gym, as a world traveler, as an investor, or in any other domain — understanding the research behind mindset is critical.

Enjoy!

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