How to Figure Out How Much is ENOUGH with Jordan Grumet

Transcript:

On this episode of the personal finance podcast, we're going to talk to Jordan Grumet on how you can figure out what's your enough number is.

Ooh, what's up everybody. And welcome to the personal finance podcast. I'm your host, Andrew founder of master money. co and today on the personal finance podcast, we're going to be talking to Jordan Grumet about his book, taking stock. If you guys have any questions, make sure to hit us up on Instagram, Tik TOK, Twitter at master money co and follow us on.

Spotify, Apple podcasts, or whatever podcast player you love. Listen to this podcast on. And if you want to have out the show, consider leaving a five star rating and review on Apple podcasts or Spotify. Can I thank you guys enough for leaving those five star ratings and reviews. Now, today I am pumped because we're going to be talking to Jordan Grumman about his book, taking stock, and we're going to be going through how to figure out what your enough number is, and we're going to go through how do you actually put together a lifestyle design review so that you can figure out.

Hey, how much do I need to save? But it's not just about the monetary side. It's also about how do I design my life? Because money is a tool and how do I design my life? Exactly how I want it to be structured. We're also going to talk about a bunch of different things on how to make sure you design your life.

So you don't regret things later on. And we're talking about how to pass down generational wealth, specifically how to give your kids the tools so that they have the knowledge to pass down generational wealth. And we're going to be talking about Jordan's advice for younger individuals and his portfolio.

So this is an. Action packed episode. Really excited to bring this one to you. So without further ado, let's welcome Jordan to the personal finance podcast. So Jordan, welcome to the personal finance podcast. Thank you, Andrew, so much for having me. I'm excited for this conversation. I'm really excited to talk to you because we met at FinCon recently and you wrote this incredible book called taking stock.

And I really, really love your perspective on a lot of it is the philosophy of financial independence and then how to practically Add this into your life and I kind of want to dive into this, but one really unique thing about you is that you are a physician. So what kind of got you interested early on in money and talking about money overall?

So I wasn't interested in money at all. In fact, my father died when I was seven years old and I wanted to be just like him and he was a doctor. So my plan in life was to become a doctor. I had no interest in money. My parents were strongly in the middle upper class and they modeled really great financial behavior for me.

So I grew up hearing about the stock market and they own their own businesses and they were like really awesome with money, but I could have cared less. I went through, you know, high school and college and medical school and I was practicing and I was all the while doing what my parents had done. So they modeled this great behavior.

So I was putting money in the stock market and buying investment real estate, but I didn't really care about it. I just did it because that's what they did. And then I burned out and I realized that maybe this dream was my father's and not my own. And I started getting really stressed out and feeling, Oh my God, I can't do this for the rest of my life.

And then I became profoundly interested in money because that was going to be my escape hatch. That was the way I was going to get away from this career that wasn't fulfilling me. And have some potential freedom over my day and how I spend my life as opposed to doing this thing that wasn't filling me anymore.

And I knew, I knew that I couldn't be a doctor for the rest of my life full time. And so I became profoundly interested in actually managing the money instead of making it and doing what my parents did. I wanted to understand it more for the first time in my life. And it seems like a lot of people have that lightbulb moment just like you had where you kind of realized, Hey, I don't want to be doing this for the rest of my life.

I did this path and I kind of followed this path up to this point. And they need to figure out, Hey, how much is enough? Because I really don't want to be working in this job anymore. And this is one struggle I even have. Up to this day where my goal post is always moving and it's something where I really needed to kind of nail down how much is enough where you don't have to work anymore once you hit this number.

And this doesn't mean that you're going to stop working, but it gives you the option and the ability to be able to stop working at that point in time. So you have some great stuff in the book on kind of how to figure out how much enough is with a life review. So how do you kind of figure out, you know, utilize that life review and how do you figure out how much is enough in your life?

So it's an interesting question, and there's a simple answer and a difficult answer. The simple answer is enough money. And of course, after reading my book, you realize that enough money actually, to me, isn't enough. Money is just a tool. It's not actually a living or a goal. Kind of living up to your sense of purpose, identity, and connections, I believe is what really fills us up with enough.

Easy answer when it comes to money, is there all sorts of calculations we know about things like safe, which are all rates. And you can look at the 25 times rule and there's some rule of thumbs that are not perfect by any means, but for some ways for you to start figuring out what enough money looks like.

The problem is if you don't start thinking about what enough life looks like, you get to that place where you have enough money and instead of being happy or satisfied or doing those things you want to do, you actually doubled down and start creating even bigger goals for your money because you don't have any.

to fill that space. Either that or you get petrified, you're going to lose all that money called loss aversion, this idea that, Oh my God, now that I have the money, I'm going to lose it. Either way, you're not happy. So the bigger question becomes, well, how do we decide what enough life is? And in the book, I've talked a lot about purpose, identity and connections.

You know, if you look at Maslow, he talks about self actualization. If you look at happiness researchers, they talk about quality of life and all sorts of Other ways of talking about contentedness, but this idea of how do we spend as much time as possible doing things that fill us up? And that's where the life review comes in.

So the life review is a structured series of questions that we actually use in hospice medicine. So I'm a hospice doctor. And when patients are terminally ill, we admit them and we take care of their pain and their nausea and we get them to a safe environment, but at some point we start looking at some of their bigger life issues.

So the life review is a way that a doctor or a nurse or a social worker or a chaplain can sit down with a patient and really start looking at their life and Talk about what was important to them. It's a way of coming to terms with your life. Maybe even think of some of those things that were regrets, some of the happiest moments, scariest moments, some of the best accomplishments.

There's a whole series of questions. But what I realized while dealing with my hospice patients is that this life review actually could be really helpful to Young people are people in the middle of their career, or a lot of the people I was talking to in my personal finance podcast, because I had become part of the financial independence movement and had my own podcast.

And I was talking to all sorts of financial experts when I found the dying had some of these answers that I couldn't find from these amazing guests I had, which is things like what is enough and enough maybe isn't money. It's more about living kind of that life. We want to live without regrets. And that is the whole key because I think a lot of people just kind of go through life and they don't figure out what this number is or they don't figure out how much is enough philosophically in terms of, you know, when you can be done and everybody kind of struggles with this.

But finding that point gives you kind of that goal post to kind of pursue over time. And here's one other big key that we talk about and you talk about all the time in the book as well is you say that work is not done when you retire. And I think this is a really important thing. Thank you. To think about here, because a lot of people, especially in the community that we're in, the financial independence community, a lot of times they think, Hey, I'm going to work for 10, 20 years and work as hard as I can and save as much money as I can.

And then I'm going to sit on a beach all day long in a sip tea and coladas or whatever else, but really that's not a fulfilling life for a lot of folks. And so when we talk about retirement or we talk about stopping, you know, traditional work, we're not always talking about just kind of ending it right there.

So what do you mean by that? When you're saying that in terms of, you know, work doesn't stop when you actually have that enough number. Yeah, it's the fallacy of what we think retirement is, right? So work is just providing goods and services, whether you do it for an employer, right? So you're an employee or whether you do it for yourself, like you're at home and you're cleaning the house.

All of those things are work. So I tell a story in the book about a dishwasher, right? And he worked for a restaurant. He had spent all these years washing dishes. And so his job, the work he did is he provided a service for his employer by doing those dishes, but eventually saved enough money and he could retire.

But what did he do then? Well, he went home and he cooked dinner for himself. And guess what? He was still doing dishes. He was doing the same work, except at this point, he was doing it for himself and not an employer. The interesting thing about him is he realized at some point that as he reached his later years and he was alone, he missed that community.

That he had in his job. So it kind of changes this idea. Maybe he would have been happier working longer, not for the money aspect, but because he was going to be doing work one way or another, whether in his house or in the restaurant, but when he was in the restaurant, he would be around people he cared about, he would feel a sense of purpose, and then he would get money in exchange for his work.

And he could use that money maybe to pay someone to clean his house. So he didn't have to do that there. And so the idea is we're going to be doing work our whole lives. Even if we retire, it might be a hobby, it might be something like a podcast or a blog or a small business we do for the joy of doing it.

It might even be volunteering for a community that we care about. But all of that in a sense is providing goods and services. When we relieve ourselves of this idea that retirement means we stop working, we can actually start thinking about doing the work that's deeply important to us. And why that's really important is because Guess what?

You don't have to wait till you have enough money to start doing the work that's important to you. When you see it as a continuum, we can actually remove this big thing we call retirement out of the picture. And so too many of people spend their time doing things they don't like doing for longer and longer periods of time because they're shooting for this thing called retirement.

And look, my father died when he was 40. So I have this perspective that maybe we shouldn't put these things off. Maybe the work we do should for today, some of it should provide money, but maybe some of it should just provide joy. And if we relieve ourselves of this worry about when we retire. We realize that we're exchanging what work we do when, and we can do that in such a way that we live our best lives today as well as tomorrow, because I hate this idea of let's put everything off until we retire, because who knows when that's going to happen?

Exactly. And I think that's one of the huge keys for a lot of people to understand is that, you know, having that fulfillment right now, this is something, for example, doing this podcast would be, I would do this, you know, At any point in time, if I was completely retired, I would do this forever. So this is one thing that I really, really enjoy.

And having that joy is absolutely life changing. Once you kind of find what that is and figure out how to spend your time doing more of that. And I think it's really, really helpful to kind of think through that. And your exercise in the book really help people kind of figure out what that is. And what are you going to do with your time after you retire?

You work so hard to actually kind of build up this nest egg. So how can you kind of have some of that joy today? And in addition, have some in retirement and figure out what you're going to do with your days. That is one really, really powerful thing. I think a lot of people really, truly need to think through.

Now, one big thing that a lot of people struggle with, and I get this question all the time, is that one more year syndrome, where a lot of times they maybe get close to that enough number or they're at that enough number, but in order to have some extra protection, they have that one more year syndrome that comes up into play.

So how can we avoid becoming trapped in that? So one more year syndrome is another version of loss aversion, right? So this idea that, okay, we're where we need to be, but God forbid, all of a sudden we're going to lose that, and we get doubly scared. And so we double down and just say, well, if we do another year, we'll make a little extra money.

Then the likelihood is we won't fall back below that key indicator, that big number. The problem is when you make extra money, all of a sudden, again, it bumps up and it was like, well, I wanted to retire with 1 million, but now I have 1 million, 100, 000. And you start getting anxious about going under the 1 million, 100, 000.

And you're doing it again. The truth of the matter is, and we all know this, the thing we really can't control is time, right? You can't commoditize it. You can't buy it. You can't sell it. You can't trade it. The only thing you can really do with time is try to have some modicum of control of what activities.

You are doing as time passes and so that's that most valuable thing that we have so little control over. So every time you choose one more year, what you're doing is you're filling that precious thing that time with activities you don't like instead of doing things you do like. And so if we think about the purpose of money.

The purpose of money is actually to be a tool so that we can have some control and do the things we like to do in this time. So if you're falling victim to one more year, you're doing the exact opposite. You're letting money keep you in a situation you don't want to be kept in, as opposed to using it as a tool to free you from things you don't want to do.

So it doesn't really make any sense. And the problem with one more year syndrome is There's never a good reason to stop. Once you start falling prey to one more year, like how do you then finally draw a line in the sand and say, okay, finally, I'm at enough. It is a philosophical change, not an actual factual one.

And that's where I think we run into problems. Exactly. I think that is one key because really you got to make sure you know, once you have that number in place, you're not just going to extend this out for no reason. And that kind of comes into line with with kind of my next question, which is because we don't want to regret some of the choices that we made early on and regret kind of missing out on some things.

You mentioned that your father passed away earlier and you know, there's a lot of lessons that you learn from that. But you also see a lot of patients out there who are coming to the end of their life and they're regretting very specific things. Yeah. So how do we make sure that we make choices that we don't regret in life later on when it comes to work specifically?

And I think this gets a lot into YOLO too, this idea of you only live once. So how do we decide when to spend today versus defer gratification and save for tomorrow? It's a very, very difficult question, right? Because you don't want to get to the end of your life and have saved so much that you passed up on all those important things.

On the other hand, you don't want to take a bunch of luxurious trips, buy luxurious things, and then find yourself at 60. Completely broke and have to work until you're 95. So this is a very difficult question and if we knew the date we were going to die, if I knew I was going to die in exactly 35 years, 6 months, and 1 day, I could then plan specifically exactly how much money I needed, I would know how to spend, and I could die with zero, right?

The great Bill Perkins. The problem is we don't know. So we need a proxy to help us understand how we can both spend today and save for tomorrow and do it intelligently. And so the proxy I often talk about is asking yourself one major question. It's, are you afraid that you're going to die young and wealthy and not use that wealth to do the things you want to do?

Or are you afraid that you're going to die at an old age, run out of money and be broke? And I think if you can ask yourself, what scares you more of those two things. That's probably the best proxy we have. And then we can start deciding on how to save today. So my dad is a great example. He died at 40 and strangely enough, he had an inkling.

He was going to die young. He always told my mom, even when he married her said, you know, I'm not going to live long. And so he made all sorts of financial decisions because he believed he wasn't going to live long. So of course he saved money for us and got life insurance and did all the smart things, but he passed up several high paying jobs.

Do lower paying jobs that fulfilled him more. He spent a lot of his time doing things. He loved spending money, traveling. He loved cameras. He had some expensive cameras. He had all these hobbies and these things that were important to him. So he didn't save 50 or 75 or 90 percent of his income. Cause he really didn't feel like he was going to have a life that extend to retirement.

So he spent a little bit more now, contrast that to me, I've always thought I'd live long. I knew I'd need a lot of money to carry me through retirement. So for me, it wasn't a big push to say, you know what, I'm going to save 50 or 75 percent of my money because I feel like I'm going to live old and I don't want to run out.

And so I can defer gratification because I'm not as worried about it. Whereas my dad deferring gratification didn't make much sense for him. He needed to YOLO. And so it's a continuum and based on your fears about which. Category you're going to fall into dying young versus dying older. You can then start making decisions about how to spend today.

And for everyone, that number is going to be different. Some people will try to save 50 percent cause they think they're going to live for a long time. Some people think they won't live long at all and only save 10%. But if you do it correctly, let's say you're wrong and you think you're going to die young and you only save 10%, but you go and spend money on what you care about.

It's true. You might have to work many, many more years, but because you're YOLOing it now and enjoying yourself and spending money. That's probably not a bad thing. And I think it really comes into play how much you love your job as well. Cause if you have your job that you love and you don't mind working longer, you can spend more money today in order to kind of maintain that over a long period of time.

I have a friend who's a, an attorney and he absolutely loves his job. He thinks he will never ever retire. So he's willing to spend more money now and just save a smaller portion of that income over time because he owns his own practice. He has his firm in place. Uh, and so there's a lot of really cool things that he does in order to kind of, you know, bridge that gap because he's going to be working for a longer period of time.

And this kind of falls into play of figuring out how much we want to spend every single month. And a lot of people traditionally, if I put the word budget in a podcast episode, Jordan, a lot of times that is my least downloaded episode of all time. And usually people just don't want to hear about budgets.

Most people do not want a budget. So this is, I think, one thing that I love that you talk about here is kind of building frugality in your life, especially if you want to save more money over time, because obviously the gap, the difference between how much we invest. Then how much money we make and how much money we spend, that difference right there is, you know, some of the money that we can use towards building wealth over that time frame.

So building frugality into your budget, how do you kind of do that? So you don't have to just sit down with a line by line on a budget and, you know, just be in spreadsheets all day long. How can you kind of build that into your life? So we are a non budgeting family. I've always hated budgeting. I really did.

So we tried to make it as easy as possible. So when my wife and I first met, we were both working and we just looked at our salaries and said, okay, yours goes to expenses and mine goes to savings. And we never saw that money. Cause it got direct deposited, went right into either investments or 401k or wherever it was going.

And we never saw it. So the easiest way to budget is how much money do you have in that checking account, that's how much money you have to spend because we already built the savings part in. Now, this is going to date me, of course, but then we also did a bunch of things that just made a lot of sense. So back in the day, you got to really go back here, people tended to spend cash, right?

You'd use cash, you'd be at class or school or wherever you were, and there'd be a vending machine and you, they didn't take credit cards back then. So you'd have to use your dollars and your quarters and all that kind of stuff. So one really easy thing we did is we just never carried cash. Like back in the day, that was a pretty effective way not to spend uselessly.

If you didn't have the cash, you probably weren't going to use it on something that was unnecessary. As we had kids, we started being much more thoughtful. So, you know, you go and you're at Walmart or Costco or whatever, and the kids see something they want. And they're like, Oh, we got to buy it. So we always created just space.

So we never told our kids. No, you can't buy that. It was always okay. You didn't know you wanted that when you walked in the store. All of a sudden you want it. Let's give it a week. And then we'll come back to the idea and see if you really want it about half the time. They would completely forget it. Now there are other easy things we do.

I mean, That's I'm a big fan of this idea that we're killing our world by mass producing things like lots of clothes, et cetera. So it feels very naturally good to me, for instance, to go to thrift stores and stuff like that. You can actually get really nice clothes nowadays at places like salvation armies and thrift stores, et cetera.

So for me, that's also another really easy way. And I beat up my clothes. Like I wear them until they're dead. And then I move on to the next thing. So for me, why spend a lot of money on clothes? It doesn't really matter that much to me. And. It's also good for environment because we're reusing something that someone else is done with.

So I think there's some really easy ways to do it. And for every person, it's going to be different. But the question is, how can you budget and not think about it? If you are a numbers geek and you love the spreadsheets, then go for it. But if you're like me and just don't want to think that much about it, how can you make your life just easier?

So you don't have to. And I completely agree as well because I'm at the point in time now where a lot of times I don't want to budget either. I started off, you know, my wealth building journey where I did do a budget. I use why now, but I would go in there and be in there all the time. And now I'm just at the point in time where I don't want to do it anymore.

I don't want to budget anymore. So just saving off the top and then spending kind of what is left over is a really, really powerful way to be able to do this. And automation has truly helped me, especially with technology advancement. I pretty much automate everything now so that really I have a budget in place, but it's just I'm not doing a single thing.

I'm not even lifting a finger. I think that's a really, really cool way to do this. Yeah. As well. Now you talk about a bunch of different paths to financial independence, and that's what I love about financial independence is there are so many different ways that you can do this. You get really, really creative with this.

But can you kind of talk about the path that you chose and maybe some others that are out there? So in the book, I talk about three paths and I talk about something called the parable of three brothers. It's a long story, but the idea is there's three brothers. They set off on a journey of a lifetime.

And they do it differently, like the eldest brother speeds to the end because he hates the path and can't wait to get to the end so he can do what he wants to do. The middle brother doesn't love the path either, but finds himself exhausted often. So it takes multiple breaks. And last but not least, the youngest brother, kind of like the lawyer you mentioned, loves the path.

And so they have no interest in leaving it. In fact, when the youngest brother gets to the end and his older brothers are there waiting for him, he does something that neither of them can understand. He turns around and walks back the other way. So this parable is a great parable for financial independence.

There are multiple ways to get there. I did the traditional fire path, right? Financial independence, retire early. I got into a profession that paid a lot, realized I didn't like it and worked my butt off, saved till I got to a set, you know, net worth number that would support me for the rest of my life.

And then I left that or retired. That's kind of that traditional front loading path. And for a lot of people, especially kind of those traditional fire advocates, That's what they did now as the fire movement is evolved. We've realized that a lot of people don't want to grind it out and spend every day doing things.

They don't necessarily love doing. So there's a lot of people who will do things like side hustles and real estate things that create some passive income. Maybe they don't love it, but it frees them up to do some other things with their time. And so that's what I would call the middle brother. They kind of work really hard, then get exhausted, take a break, then start working really hard, then take a break.

So that's another way is once you get enough passive or side hustle income or have enough properties that pay your monthly needs, you're pretty much financially independent and you can become financially independent years before someone who front loads a sacrifice, who it takes them 10 or 15 years to get to that network.

So those are two pathways, and then the last pathway, which I call the youngest brother's pathway in the parable, is really, it's the passion play. This idea that if you can find a job that you love, that you feel like you're fulfilling your sense of purpose, identity, and connections, a job you'd do even if no one was paying you for it, but you happen to get enough Pay to cover your monthly needs, assuming you get the right insurances and do some risk mitigation, you're pretty much financially independent from day one.

And so whereas we've always thought of financial independence is this vaunted thing that would take you forever to get to, I think younger people are smarter and they're realizing that they can modify their path in such a way that they can live that financial independence lifestyle today, regardless of how much money they have in the bank.

And so by utilizing these different pathways, we can start finding ways to feel financially independent very quickly. Regardless of where we are in our bank accounts and our savings. So I was very much the front loader, but I'll tell you that changed over time. Once I started getting closer to financial independence, I actually started doing more side hustles.

One of my side hustles was practicing hospice medicine as a medical director. It was a medical side hustle and I made a little extra money on the side. So then I became very much like that middle brother who's getting exhausted and needed kind of some breaks, but funny enough, I fell in love with hospice medicine.

And stopped really caring. I would do this work even if no one was paying me. So that and I became kind of like the youngest brother. It was more the passion play. So what's really exciting about this is you can hop from modality to modality as it serves you. And we all know we have these different seasons in our life.

So when you're young and you don't have kids and you're not married yet, you might want to grind it out. But then when you have your first kid, Maybe you want to become a middle brother and take a, you know, a mini retirement or a sabbatical or start a side hustle to free up some of your time. And then maybe as you're older and the kids go away to college, you can really do that passion playing, go back to doing something you really love.

And again, this pulls back into this idea that we're going to work for the rest of our lives. Sometimes we're going to get paid for it. Sometimes we're not, but you can build that in a little bit too. So maybe as you get to. A more senior age, you're doing things you love and you're getting some pay, but maybe it wasn't as much pay as you were getting before, but you're doing the work you love and it's supporting you.

And so there's so many really cool ways now to play with your career and to play with your finances, to really support you living a good life throughout those seasons, as opposed to waiting to a better season. And the same thing happened for me where I started off as the, you know, the oldest brother and was trying to grind it out and save as much money as I possibly can.

And honestly, I was miserable doing it this way, working my way up on the corporate ladder, kind of going through that and then morphing to, you know, having a side hustle like a podcast and some other things that we did. And then Eventually, it morphed into, you know, my passion project, the youngest brother and having that something where it can support me full time if we need to and or, you know, I could do this forever.

This is something I'm willing to do forever is to help other people learn how to build wealth and have their money, you know, together like that. So I think it's such a cool way to kind of think about this. And I encourage everybody to go get the book to read the parable because I think it is so cool to kind of think through this in that way.

So I think this is really, really amazing. Now I want to shift gears here to generational wealth because you mentioned you have kids and I kind of want to talk through this because we have a bunch of audience members listen to this podcast who have either young kids or their kids are getting older now.

So how did you kind of talk through and approach talking about money with your kids? So I really feel strongly about this. The least effective way to bring your children generational wealth is to give them money. So I think there are lots of better ways to actually provide generational wealth. And mostly what that is, is teaching them about money in such a way that they will eventually provide it for themselves.

Now, I think there are. Three main ways we teach our children about money. And some of them are effective and some of them are not. Let's talk about the least effective. I think the least effective way to teach your child about money is to didactically teach them to sit them down and say, this is compound interest.

This is the stock market. This is how it works, et cetera. A lot of times they're young and they just don't care. And it goes right over their head. So that's least effective. What's a little bit more effective is what my parents did, which is to actually model great financial behavior. So my parents didn't didactically teach me about things, but I saw my stepdad going on weekends to repair the rental place.

I heard them talking about the stock market, what they were doing. I saw them saving 50 percent of their income. I saw them building companies and leading them themselves. So that financial modeling. Really had a profound impact on me. And last but not least, and something I wish they had did more of, and something I try to do a lot with my kids is really the last and most effective way to teach your kids about money is to provide them safe ways to fail.

And to try on different financial personas and see how it fits them. So when my kids got to a certain age, instead of giving them a weekly or monthly allowance, we gave them a yearly allowance and gave them a set amount of money at January 1st. And we said, this is your money for the year. This is what it needs to cover.

And we would write it out. Like we'll pay for food, but you have to pay for candy and these kinds of things. And then they had to navigate the year and use it appropriately. Right, and sometimes they would succeed and sometimes they'd fail. I, I tell the story of my son who likes to spend a lot of money and was in the middle of the year and dropped his phone into a pond and lost it, and all of a sudden he had no money to buy a new one, and he realized that he didn't have an emergency fund, he hadn't been saving anything, and he was almost tapped out in the middle of the year.

On the other hand, my daughter holds onto money so tightly that she often gets. to the end of the year and hasn't bought half the things she wants and her bank account keeps going up. But in a sense, what we've done is we've provided guardrails for them to experience very adult things, but as a kid and when they fail and when they do something wrong, there aren't huge consequences instead of waiting.

For instance, when they go to college and they get their first credit card, they can really do some damage if they haven't had some experiential learning. So. Didactic teaching, least effective modeling, very effective and most effective is really experiential learning. And I think to me, that's the way more important legacy than leaving the money.

Cause let's be real. If I leave them money by the time I die and they get it, they're going to be hopefully in their fifties or sixties or seventies, it's not going to do them much. Good. They've already done the hard work really. If you're going to leave. A legacy of money. You're leaving it to your grandkids.

So I love this idea of, and my parents did this too. My parents started saving for a 529 for my kids when they were little babies. So I love this idea of providing for things like education. And really what you're looking at is your grandchildren when it comes to money, but with your own children, you're really teaching them how to be smart with money.

I love that idea of doing the allowance at the beginning of the year. I've never heard anybody talk about that, but I think that's a really cool way to get real life experience on how to manage your money because they're going to have a few failures along the way, and that's going to really teach them for the rest of their life.

So I absolutely love that idea. I'm thinking I'm going to steal that. My kids are five and two, so it's a little early for them, but at the same time, yeah, you have to wait till they can kind of get the concept and then you can build in like giving them debit cards and all that kind of stuff. It really, this is the safe experiential learning.

We'll do them wonders. I believe. And I a hundred percent agree as well as is kind of teaching them, you know, how to actually manage their money is so much more powerful than giving them money. And most people, I think that we talked to in this podcast as well, we get feedback on that and a lot of them, that's the way they want to do it.

I think that's the most important thing when it comes to generational wealth is teaching them the right strategies for sure. So do you plan on passing any generational wealth down to your kids or is it all going to your grandkids or how do you think about that? I imagine that some will go to my kids and some will go to my grandkids.

What goes to my kids is going to be a bonus. Like, Hey, you did a great job with your finances and here's some extra money. Like go have a fun time for my grandkids. Hopefully it will be the start of educational, you know, paying for their education, maybe helping them pay for the first house, those kinds of things.

So that's my goal. I mean, I suspect I will die with way more money than I thought I would because. I'm conservative by nature. And the truth of the matter is at least when it comes to me, money and good life don't necessarily equate like money. I think of very much as a tool. So I want to have enough to always support myself, but the really important stuff to me doesn't really revolve around money, so I'm not likely to kind of.

Overspend. It's just not what brings me joy. So I'm sure there'll be money left and, uh, yeah. And I'm sure I'll also give to causes that I feel are important, right? I want to give and change the world, right? If we have this extra fuel, this extra tool, why not use it to help people? Exactly. And that's what you heard me mention earlier that my goal post kind of moves all the time.

And part of the reason why my goal post has moved is just because I want to give back to kind of causes I believe in. And that's a huge portion of why my actual number has increased over time. So one big thing we've talked about today is kind of regaining back your time and financial independence.

That's one of the biggest things that most people want to do. So when your kids are under your own roof and you know, they're younger or they're, you know, as they start to progress through life, how do you ensure that you're not working too much and you spend more time with them, especially for folks who are high performers who, you know, need to work all the time or want You know, I think this is a balance because we also talked about modeling and part of modeling is actually having your kids see you do things that you're passionate about.

And so you want them to see you become the CEO and you want them to see you build the house and you want them to see you pursue hobbies and tinker with the car on the weekends, etc. So I think it's a balance. But part of that balance is bringing them into your world so that you can have that positive modeling on them.

I often talk about this idea of generational trauma, right? This idea that we hand to our children, these bad traumatic things that happen to them and through our behavior, we make it their trauma. And it started as ours. I like to look at the exact opposite generational growth. So what can we hand to our children where they see us being nourished?

Intentional thoughtful and purposeful and so the idea part of it is to really bring them into your life right to bring them to work and have them see what you do to have them help you work on the car or have them go and help you fix up the rental apartment that needs fixing between tenants like. To bring them into your life, I have to tell you that one of the boons of financial independence for me certainly was, as I pulled away from work, I was able to be there every morning when they left and every afternoon when they came home.

And that was a huge boon that I was allowed because I was smart with my money. And so, Realizing that there's these seasons in your life, realizing that once they go to college, they've spent about as much time with you as they're going to for the rest of their lives, it makes sense to sometimes slow down at work or slow down on financial independence to be there during that season because once it passes, it's gone.

And so we have to be intentional about all these things. I will not. You know, lie and say it's easy. I think it's probably one of the hardest things we do, but if you're thinking about it and if you're trying to create some of those moments with them, I think you're far ahead of the game. Completely agree.

And I think that is one of the most powerful things. I love that generational growth term. Cause I think that's a really, really cool thing. And like I told you recently at FinCon, we, we bought a physical business recently, and part of the reason why I bought that is my kids are younger now, but I want to kind of bring them in and kind of show them how business works.

And over timeframe, I thought that I could do that with that, but that there's some really, really cool stuff that you have there. So I really. everybody. Jordan talks more about it in the book as well. So I think it's really, really cool there. So another question I have for you is for younger people who are just starting their career.

We have a large number of listeners who have just started their career and are trying to kind of figure out, you know, how can they can build wealth over time? And they're trying to navigate their whole financial situation. Do you have any advice for people that are in that situation? Yeah, actually, the first piece of advice that really comes from the book is put your finances on hold in your mind for a moment and actually think about what purpose, identity and connections look like to you.

And there are a bunch of exercises in the book to help you start sorting through those things. But I think a big problem we make is we jump right into the finances without thinking about the why behind them. So I think if you can start thinking about purpose, identity and connections, what feels purposeful to you, you can then build a financial framework.

Around it. And that's when we start getting into the parable of the three brothers. Once you know what purpose looks like in your life, you can then start making some real choices about what building wealth looks like for you. The truth of the matter is building wealth is easy. I should say it's simple, not necessarily easy, right?

We all know how to build wealth, right? You need to make more money than you spend. You need to invest wisely and you need to do it for long periods of time. It's going to be the same for all of us. That basic piece. But the why and the how can be radically different for each one of us. So figuring out your why and then building a how around it will then make your financial journey a lot more enjoyable.

And I would say a lot more purposeful because you can start doing those things that are deeply important to you now, because again, you never know if you're going to be like my dad. You don't know if you're going to die at 40 or 80. Why spend time doing things you don't want to do now, just because. It was too difficult to start thinking about what you really do want.

And that's the hard work. That's the hard work the book suggests. It's not emotionally easy, but I think it's really necessary because I think we should be living our best lives today as well as tomorrow as opposed to trading one for the other. Exactly. I love how the book kind of takes you through those actionable steps.

You know, get out a piece of paper. It gives you those steps on on exactly how to kind of figure this out, especially if you're early on in your career. Now, I want to talk about your money for a second because you mentioned that you're conservative when it comes to how you spend money, but also, you know, how you invest your money as well.

So if someone was looking at a pie chart of your investments, how would that be broken out? So let me tell you how it used to be and how it is now. So it used to be that I was somewhere around 30 to 40 percent real estate, 30 to 40 percent taxable brokerage, and then 30 percent or so. 401k, et cetera, IRAs, et cetera.

I got tired of real estate, especially during COVID. I sold all my properties. So really now we're pretty close to 50, 50 or 60, 40 with taxable brokerage versus tax deferred, traditional IRAs, Roth IRAs, and 401ks. And we are a simple Bogleheads three fund family. I mean, and it's spread out, you know. Most of our bonds, for instance, are in tax deferred, but ultimately we're somewhere around, I think we're about 60 percent VTSAX, so broad market based index US, about 30 percent international index, and then about 10 percent bonds, and I haven't been real big on pushing the bonds because we still have active income because the work I do that I have joy in, I also make some money doing as well as my wife has continued to want to work.

So we still can cover most of our yearly not. Just dealing with our income. So I'm still pretty aggressive with the equities because I don't see any reason to be more moderate, but over time I probably will moderate as we stop making money. And I love that because I think the classic three fund portfolio, you and I have similar portfolios that we kind of have it structured in that way.

And I think that is, you know, one of my favorite ways to go through that as well. So I'm going to ask you a couple of rapid fire questions here that I love to ask some of our guests just to kind of go through and see what you think about this. So what are some of your favorite books that you have read as of recent?

So I'll talk about financial books because I think those relate. Um, I'm a big jail Collins fan. He's a, he's a friend of mine. I love hanging out with him. I think the simple path to wealth is the Sentinel book. And I think his new book pathfinders is just followed up. So I think they're fantastic books.

It's hard. Cause these are all my friends, right? Grant's about to a financial freedom. I think the millionaire next door is a great one to start with for a lot of people just to kind of. Understand the ethos, et cetera. So I'd say those are kind of three books that I've kind of invested myself in and have really helped in my path.

All those are fantastic. I haven't read Pathfinders yet. I got to get to that. But I think all those are fantastic. And those are ones that we recommend all the time as well. What part of your work or life makes you come alive? So hospice work definitely makes me come alive. I love doing hospice work, podcasting and writing.

I mean, literally My favorite time is when I'm behind a mic interviewing someone. It's probably one of the things I think I was meant to do with my life. And so every moment I spend doing that is usually a joyful moment. Writing's a little more difficult. Writing itself can be painful, but what comes out of it is so incredibly joyful.

I'm lucky. I mean, I feel a lot of content. I love reading like I sit in and not reading for like learning. I love to read just for entertainment. I spend usually about two hours a day reading. I spend. At least an hour to do doing some type of exercise. I love walking. There's no shortage of things I like to do.

I find myself very engaged most of my days because I've just created these things that feel very purposeful to me and I'm able to pursue them. And most of the time, my real end point is the joy of the process as opposed to some big goal. And so I get to do these things that I enjoy doing most of my days.

And that's what I love for most people. If you're listening to this and you're envious of Jordan's day and how he kind of has this structure, this is exactly what we're talking about here. Why we pursue financial independence so that you can have time to do all of this stuff. So it's a really, really powerful testament to how you built out your life.

What is your biggest fear when it comes to money? I don't think I'll ever get over this idea of running out. And I have some generational trauma there, right? Because when my dad died, my mom was right in the midst of getting her MBA. There was all sorts of questions. Would we have enough? She was worried about having enough to send her three boys to college.

And my grandma grew up in an orphanage during the great depression, right? So I've got some generational trauma about enough, and I don't know if I'll ever completely get over that. I think the things you can do and you can talk it out and go to and all those kinds of things, but I'll always worry about running out.

That doesn't necessarily stop me from doing things, but it's definitely something that crosses my mind. And I've definitely got to the point of quite a bit of acceptance with that. Like I just kind of accepted it is who I am. And an easy way to deal with that is, you know, I always have some income because the things I like doing provide income.

So it's a really great way to assage those fears. Like people talk about safe withdrawal rates and there's all sorts of debate about that. And I just bypass that by saying, well, I'll do something that makes a little money, something I enjoy, and that's going to always protect me. And that's kind of how I deal with that.

I agree with that as well. I think that's really, really helpful, even just mentally to be able to kind of get over that hump of making sure, you know, you have enough is having some sort of income coming in at any point in time. Do you have any plans to level up your finances this year? Are you just going to add to your portfolio?

Really at this point, I am in maintenance phase. So I love this idea of, you know, I look at my numbers and I've calculated safe withdrawal rates and I've done spreadsheets and I'm in a pretty good place, even if I never worked again. But I love this idea of just carrying on doing things I like to do. And again, if they, if they provide.

Economic return. Great. So actually for the first time ever, believe it or not, we're remodeling our house, spending way too much money. Something that normally like I wouldn't have felt comfortable with, but we're getting to that point. We've never, we've been in our same house for 20 years and we've only done, we've done some major remodels, but not to this extent.

For the first time ever, we actually liquidated some equities. I don't think I've ever liquidated equities in my life except to then move them to something else. Like this is the first time in my life we've liquidated some equities and we're going to use that to spend. And so that's like a big change in my life.

And I'm 50 years old. I've been incredibly conservative my whole life. And so these are all changes, right? And it's something we have to get used to. I love that. And I think, you know, this is one thing I always talk about in the podcast too, is, you know, you could do all these calculations of like the safe withdrawal rate and all these things, but once it's time to actually start to draw on that portfolio, it's gotta be a kind of a scary, daunting feeling to actually get to that point in time.

So that's really cool that you guys kind of started it in that way. And you can use it on something that you're going to enjoy for sure. If you could tell your younger self, one thing about money, what would it be? Money is a tool and it's only as good as what it buys you. And I think I missed that for a long time.

I really felt like it in itself was a goal and that shooting for these money goals would mean a fulfilled life. And then I got to a place where I had enough money and I realized it didn't really solve many of my problems. It solved my money problems, but my money problems were very finite and they weren't actually the problems that kept me up most nights.

And so I think putting money in its appropriate place, realizing that it's a tool, but it's one of many tools and then learning how to use it without getting overly aggressive about worrying about it are things that I tell young people all the time. And I wish I did a better job of when I was that age.

The last one, and this is my favorite one. What does wealth mean to you? Wealth. This is exactly what wealth is for me. It can be very granular about this. I keep my calendar on my phone. So when I look at my calendar on my phone, almost everything is cancelable. And almost everything I put on there, no one put anything on my calendar.

I put everything on there. And any given day, if I wake up and decide, I don't want to do that, I don't want to record that podcast. I don't want to take that meeting. I don't want to do whatever it is. I can cancel it. And they're pretty much no major consequences. The only consequences are I did one less thing I thought I wanted to do.

And so to me, that's wealth. I love that thought. The cancelable calendar, I think is one of the, one of the coolest things that you can have in life once you have that available to you. Well, Jordan, this has been absolutely amazing. I encourage everybody to go check out the book. Where can they find the book?

podcast and everything else? So the easiest way to find me is to go to jordangrumet. com. That's J O R D A N G R U M E T dot com. I pretty much in the past have created content in three main ways. One is I wrote a medical blog from like 2003, 2004 to 2018. It's called In My Humble Opinion. You can get the link there.

The other is I wrote a financial blog called diversify also the link there. And what I spend most of my time doing now is the earn and invest podcast, earn and invest. com. But also you can find the link there. And last but not least, taking stock. The book it's been since August of 2022, you can find out how to buy it there.

And you can learn more about my new book, which is going to come out in January of 2025, which is called the purpose code. I'm excited for that one for sure. Jordan, thank you so much for coming on and we truly, truly appreciate it. It's been fantastic. Awesome. Thank you so much for having me. It's been a blast.