Listen Money Matters - Free your inner financial badass. This is not your father's boring personal finance show.

Ever dreamed of living in a van down by the river? Our guests actually do. They’ll tell us how to live in a van and do what you love. You hear about people who decide one day just to give up the 9-5 life most of us live to do something different, and today we speak to a couple who did just that. No Really, They Live in a Van Our guests are  Syd and Macky, both professional mountain bike racers. They bought a used van, made some modifications and hit the road in late 2014. Since then, they have traveled 30,000 miles all over the US to attend bike races and just to see the country. That sounds romantic, and sometimes it is. But other times, it’s not. Driving around looking for a place to camp, the threat of an injury that could disrupt their training and racing. It has taken a lot of effort to be where they are now, and they love their life, but there are parts no one sees. So, What’s the Big Secret? Everyone wants to know the big secret that allows the couple to live this life. No big secret beyond determination, passion, and persistence. But there are a lot of small secrets, and that’s what they are with us to share. For Syd and Macky, travel is their priority. They don’t have a lot of the comforts we have, but they aren’t interested in those things. They spend money on what is important to them. Neither are location dependent on income. They make money by racing, sponsorship, and freelancing, all of which they can do from anywhere. They use travel rewards credit cards to pay for airline tickets. If you know which cards to have and how to churn the system, you can virtually fly for free. It’s Not About the Van When you see the van on the site, it’s not like one of those twee tiny homes. It’s a utility van, and most of the inside is taken up with biking equipment. The van allows the couple to live the kind of life they want, full of travel, pursuing careers that they love, and being free of the financial worries that come with more traditional choices. Write it Off Remember the episode we did with Natali Morris about making your family into a business so you could write off a lot of expenses? Syd and Macky have perfected that advice. Last year combined they earned $94,000. Of that, about two-thirds were from sponsorship. They claimed $57,000 in expenses for things like hotels, car rentals, and race fees. They saved $27,000 and paid taxes on just $37,000. The total non-business expenses for the year were about $11,000, most of that spent on food. By living so cheaply, Macky was able to pay off $20,000 in student loan debt. A Life of Adventure The couple participates in about 15 races per season. They race two out of three weekends between April and late August. They now race full time. It took a few years to be able to get to this point. For a few years, just 30-40% of their income was race related; the rest came from freelancing. During the off-season the pair work on content creation that they and sponsors can use. Because this career is so precarious due to the constant threat of injury, the couple is successfully turning the lifestyle they live into their brand and their product. They sell t-shirts and water bottles and have designed a course on how to attract sponsors. How to Live in a Van A big downside of the lifestyle is dealing with the logistics that you don’t have to worry about in a house or apartment; making sure you have water before going to bed or spending a few hours sitting in a laundry mat. But they’ve done it long enough to have systems in place. They’ve pretty much perfected cooking on a gas,

Break old money habits and change your mindset around money. Today we rewrite your money story with Belinda Rosenblum. We all have preconceived notions around money, many of them unconscious. If we can tease those notions to the forefront, we can conquer them and the behaviors they cause that hold us back financially. Belinda’s Story Our guest is a CPA and wealth expert who helps people take the worry and fear out of money. She believes life is supposed to be fun, and money is supposed to fund it for you! Belinda left her thriving corporate finance role to found OwnYourMoney.com in 2007 and lead a movement to change our entire perspective on money – so we release the overwhelming shame, take control, and learn the needed skills to be confident with money. Belinda is the creator of the Money Makers Academy, a monthly step-by-step program that quickly shows you how to make more and save more money – without the confusion and stress. This is about teaching you the essential money skills and mindset that you may assume everyone else knows but actually very few people were ever properly taught. You can even begin to “Shift Your Money Destiny” in her new free online workshop open for a limited time at www.ownyourmoney.com/listen — get instant access now to the Money IQ Quiz and Rewrite Your Money Story Guide! She also is the coauthor of the book, SELF-WORTH TO NET WORTH: 12 Keys to Creating Wealth Inside and Out, offering a step-by-step approach to help you build your financial self-esteem and manage your own financial life. We All Know What To Do Being financially healthy and physically fit have a lot in common. We all know what we should be doing; don’t spend money you don’t have on things you don’t need by charging up your credit cards. Eat meat and vegetables for dinner, not chocolate cake. That doesn’t always mean we do the right thing though even when we are well aware of what that is. Why not? Sometimes we do manage to stay on the right track, we don’t overspend on our credit cards or eat cake for dinner. But then something happens, we might not even realize the correlation, and we fall back into our old habits and our old holes. Addressing the Symptoms but Not the Disease For whatever reason, we were able to do well for a time. Maybe we got busted by a partner for those bad habits that affected them too. Maybe we got a new job with a significant pay increase and were able to pay off the credit card debt. Those things only address the symptoms; the overspending, not the disease; what is causing us to overspend? The Original Sin What is the reason we fall back to those old, bad habits, sometimes without even realizing it? Maybe we never learned good money skills. Our thoughts and habits around money are formed early ages 4-7. If we didn’t have parents who modeled good money habits, many of us never learn them unless we seek them out on our own because they surely aren’t taught in schools either. Our beliefs around money affect so many other areas of our lives; how hard we work, what kind of jobs we take, how we interact with our family about money. To find our true money destiny, we have to uncover those original money sins that have shaped our behavior over the rest of our lives. Getting to the Bottom of It Belinda has developed steps to help you uncover the disease, the reason you have these behaviors around money, rather than just slapping a band aid on the symptoms.

The Oracle of Omaha is a font of wisdom. He is perhaps the most successful investor in history. So he knows a lot of lessons we can all benefit from. Here are 22 life-changing lessons from Warren Buffett. Warren Buffett quotes are almost as good as Yogi Berra quotes. Whether you want some words of wisdom on investing or how not to be a better person, there are Warren Buffett quotes to guide you. On Risk 1. “Risk comes from not knowing what you’re doing.” 2. “Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.” 3. It is not necessary to do extraordinary things to get extraordinary results. 4. After all, you only find out who is swimming naked when the tide goes out. “It is not necessary to do extraordinary things to get extraordinary results.” So many people delay investing because they think they need to understand how it all works or to have lots of money before they can get started. You don’t. You can go to Betterment right now with zero knowledge of investing and almost zero dollars (there is no minimum) and get started. Just do it. Do it now. Time is ticking, and the most powerful force in personal finance is compounding interest, but it needs time to work its alchemy. This quote is accurate for lots of aspects of life. You don’t have to do an extraordinary amount of exercise to improve your health nor do you have to be an extraordinarily gifted athlete to get started. You don’t have to write a remarkable resume, the greatest resume ever crafted, to land an extraordinary job. But you do have to send out resumes. You don’t have to be extraordinarily attractive or have an extraordinary game to ask that cute girl or boy out and find extraordinary love. To get extraordinary results, you just have to do a lot of normal things in the right direction. “Risk comes from not knowing what you’re doing.” There is a vast difference between risk and calculated risk. But the only difference is research and preparation. It is risky to quit your job and start a new business. It is a calculated risk to do enough research to know that there is a demand for your business and to continue working your 9-5 until your business starts to make money. It is a risk to invest in a company you know nothing about or a product you don’t understand. It is a calculated risk to research a company’s debt to equity ratio, price to earnings ratio, and who makes up the leadership and then decide whether or not to invest. Value 1. Price is what you pay. Value is what you get. 2. It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price. 3. The investor of today does not profit from yesterday’s growth. 4. Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down. “Price is what you pay. Value is what you get.” One of my personal finance lessons is Vimes theory of boots. It explains how poor people spend more money on things over time than rich people because rich people can spend more up front for things of better quality that last longer. Poor people have to buy the cheapest option available, and those cheap options have to be replaced more often than better quality ones. If you have to make a fairly expensive purchase, furniture, appliances, a computer, get the best available, which is not necessarily the most expensive, even if you have to save up for it. Buy it for Life is a great resource to get advice on making ...

Sometimes we get awesome questions from our listeners and we like to do an episode around them. Today we have five awesome questions from you about 401k loans, side hustles, student loan interest rates, buying a home and early retirement. Today our five questions are relevent for a big chunk or Americans. If you know someome who might benefti from our answers, send them our way. And maybe have them send in five questions of their own! Question One Looking for some advice around the 401k loan. I went back and listened to your show around this and still not quite sure what to do. Is it smart to take a significant loan from my 401K for any of the following: 1) Buying first rental property? 2) Making updates on a current home that I live in? 3) Using it to buy conservative individual stocks that have good returns/dividends historically. Thanks for the help. I really appreciate it. 401k loans are taboo in the personal finance world. There’s lots of scaremongering around the subject but under the right circumstances, it can be a beneficial move. We devoted a whole podcast to the subject. To make it worth the risk, the loan should be short term. If you’re using it to buy a rental property that you’ve done all of your due diligence on, go for it. If you’re using it to do renovations that will increase the value of your home before you sell or turn it into a rental property, go for it. Here is a list of the renovations that will earn back your money and then some. So that’s a yes on #1 and a yes on #2 if you are doing the renovations with the intention of selling your home. #3 is a hard no. Investing is not a short term proposition. And because you have to pay the loan back within 60 days, only borrow from your 401k if you are 90% sure you will not lose or quit your job before the loan can be paid back. Question Two Andrew, My question today is about saving vs debt reduction vs side hustle money. My partner and I live in Brooklyn. I make about $53,000 a year and my Partner makes about $75,000 a year. We keep separate accounts and have a shared account for rent and living expenses. I put in $1400 a month into that account. Out of our joint account is were we pull money for our joint Betterment house savings account. I also have student debt totaling $42,537.13 I pay my monthly minimum payments automatically. I am 39 years old and have only the small amount of money that is in my Betterment account. If I hadn’t started listening to you I might not have a budget, still be in credit card debt and have no savings. So its a start but I feel behind the eight ball here. I need to make more money, I am an intelligent college educated man living in NYC and make shit money. So I want to start a side hustle. So my question is, should I spend some money to start a side hustle? Just hit my debt with the avalanche? Throw it all into Betterment because my student loan interest rates are fairly low? Or is it a combination of all three? There is no guarantee that my side hustle will make any money though. -Ash A side hustle should cost you time, not money, at least at first. If your enterprise starts to make some money, than you can think about spending some money to make more money. There are plenty of

The future is creeping up on all of us. If you’ve been avoiding thinking about it, it’s time to get serious about retirement and your goals. We know its hard but it’s time for some financial adulting. The Future Happens With Or Without You Some of us put off worrying about money for a long time. When you’re in your twenties and thirties, retirement seems so far away that it’s not worth thinking about. But the clock is ticking and you are wasting the most powerful thing in personal finance, the power of compounding interest. The longer your money is invested, the more it grows. There is no substitute for the power of time. This is the time to pay iff your debt, grow your income, start investing. and grow that net worth. Whether you think about the future or not, it’s happening. Well, there is no time machine to take us back and invest our money earlier but if the best time to start investing was when you were 18, the second best time is now. We know, adulting is hard. Know Your Number Another reason people don’t give too much thought to retirement savings is that they have no idea how much money they need to save for retirement. You need to know your number. But which number? Most people want to know the number they have to have saved to retire. But there is a more important number; your savings rate. There is a calculator you can use to get the percentage of your income that you need to save to retire in X number of years. The calculator assumes that you have $0 in savings and $0 in debt so you’re starting from a blank slate. That isn’t the case for most of us so you can use the number you get as a ballpark. The average US Savings rate is 6% of income. By saving just 6%, you will have to work for 62 more years before you can retire.  A savings rate of 27.4% means you need to work for 30 more years. A savings rate of 53.6% means you need to work for 15 more years. Okay, good. Now we know how the percentage of our income we need to save to retire in X years. But how can we come to the big number, the total we need to save before we can retire? There are lots of complicated theories and formulas about how to arrive at your retirement number but LMM likes to keep it simple. That’s why we like the 4% rule. The first thing you need to do is estimate how much money you will need a year during your retirement to pay your expenses, all of them, housing, utilities, food, travel, etc. For many people, living expenses decrease during retirement. We may downsize our home as we become empty nesters or will have paid off our mortgage. We are no longer tied to an area because of work. You might have lived in and worked in a city because that’s where the higher paying jobs were but you can live anywhere you want in retirement and that might mean a place with a much lower cost of living then you were living in during your career. You won’t have the expenses associated with having a job and hopefully will no longer be supporting children. The 4% Rule Come up with a number you can live on each year and then maybe increase it a little to err on the side of caution. Now we can employ the 4% rule to know how much money we need to have in our retirement pot. The 4% rule is a benchmark that can be used to calculate how much money you can withdraw from your retirement accounts every year for your expenses for at least thirty years without depleting tho...

All of us have spending leaks, money we spend that we shouldn’t. Stop wasting money already! We’re getting back to basics. While you were all busy investing in real estate and monitoring your portfolios, you’ve been steadily wasting money. We’re all guilty of it, but from time to time we need to go back to personal finance 101 and take a hard look at how much we are spending day to day. What Gets Measured Gets Managed How many transactions are charged to your credit card that you forgot about or know about and don’t use but don’t bother canceling? When it’s $8 a month here for Netflix that you don’t watch and $35 a month there for a gym you don’t go to, it starts to add up. Sit down and go through your credit card transactions. Stop those subscription expenses that you don’t use.When you don’t even swipe your card for transactions like those, you don’t realize how much money you’re wasting. And when you hand over your card for little things like coffee or a bodega bacon, egg, and cheese, at that moment, you don’t feel like you are losing anything during that transaction. You’re just pulling money out of an account you don’t see. Do you really enjoy that coffee each morning or is it just part of your routine on your way to work? If you sit down and drink your coffee and read the paper, fair enough. That is enjoyable. But if you just grab it after you leave home (where there is coffee) and before you get to the office (where there is coffee), that’s nothing special; it’s just a habit. A habit costing you money with no real return. Maybe you meet friends every week for trivia night or board games. This is something you don’t have to spend money on; it’s not a necessity. But it is enjoyable, probably more enjoyable than your coffee on the way to work. Or maybe you enjoy them both. But nearly all of us have limited resources, only so much disposable income. You will sometimes have to choose between two things you enjoy or start thinking about how to you can earn some more money. As it Happens Because spending these relatively small amounts of money doesn’t feel like spending money, you have to make it more painful. Every time you spend money, write it down as it happens in a little notebook or log it into an app like Spending Tracker (for iOS) or Expense Manager (for Android). If you can’t manage that, use the boot camp of budgeting systems, the envelope method. It’s strict, but it works. You make an envelope for each of your non-fixed expenses, so things like gas, groceries, clothes, entertainment, etc. and budget a certain amount of money for each envelope. When an envelope is empty, you have no more money to spend in that category until the following week or month, however often you set the budget. No credit or debit card to bail you out, you leave those at home until you are disciplined enough to make the envelope method work sans envelopes. Bonus Tip If this all sounds penny ante and you want to save pounds, not pennies, there is one sure way to save money. Get a cheaper living situation. That might mean moving home with mom and dad for a time, getting a roommate, moving to a cheaper apartment or home, or moving to a location with a lower cost of living than where you are now. The personal finance rule of thumb is to spend no more than one-third of your income on rent...

Money is almost as taboo a subject as sex and arguably, just as important in a relationship. But too few people bring it up. Today we are getting financially naked with the Broke Millennial. We continue with Money May. Erin Lowry of the Broke Millennial joins us to get back to basics. How to talk about money, with yourself, your partner, your friends, and your parents. Talking Money With Yourself We all have areas where we are not honest with ourselves and for a lot of us, money is that area. We don’t spend that much eating out, we don’t spend that much on clothes, you don’t spend that much on video games. Well, a quick trip through Mint might tell you otherwise. Be honest with yourself. Open all those bills you’ve been afraid to open. Start calculating how much you need to retire and compare it to how much you have saved (if might be nothing). Understand that almost no one can have the best of everything. We have to decide where our priorities are when it comes to spending money. If you really love eating out and you’re spending more than you should do it, you don’t have to stop eating out, but you do have to make cuts somewhere else. Getting Financially Naked This is the frankest money conversation you will have. If you are about to tie your finances to another person, you must disclose where the bodies are buried. At the very latest you want to have this conversation when you realize you could marry or move in with this person. Don’t spring it on them. A week or so ahead of time, suggest getting a bottle of wine and talking about your goals. This gives the other person time to get used to the idea and time for both of you to gather any documents or numbers you might need. Not everyone knows off the top of their heads how much they have in Betterment or how much credit card debt they have. Framing the conversation around goals is important. You share your goals, to buy a home, to retire early,  to pay off debt. Then you can discuss any obstacles to those goals. This makes it sound more like you care about your future together and less like you are either some kind of gold digger or judging a partner who may have made poor financial decisions. Keep a poker face. Don’t bug out your eyes when you find out your partner has $80,000 in student loan debt. Don’t laugh when they tell you they have no savings. If you did those things when this person got naked in front of you, you shouldn’t expect to see them naked again. If you do those things when they disclose things about what is a vulnerable subject for a lot of people with honesty, you shouldn’t expect them to do that again. This might take more than one try. That’s okay. Money should be an ongoing conversation throughout your relationship. Talking Money With Your Friends Having money conversations with friends may be the hardest of all. No one wants to always feel like the poor friend, even if you are. And you don’t want your friends to think you’re bragging if you have a lot of money. Just as money can ruin a marriage, money can ruin friendships too. It’s harder to navigate money in friendships than in relationships because you have a few friends but only one partner. That means you have different money relationships with each of your friends si...

No matter what your financial goals are, sometimes reaching them can feel like a slog. Do you need some money motivation? We got you. This is Money May and we’re going back to the basics. We are going to motivate you to take action, to stop making excuses and to finally do what you already know you need to do. At the end of this month, you’ll be motivated to take on the world. Because when you change your money habits, you will change your life. Our Motivation Sometimes doing LMM can seem like a slog. We get complaints about some ridiculous stuff. But sometimes we get an epic email that reminds us why we do this. This is one. “To give you a short background. I am husband and father of 4 kids. I graduated college in 2014 with an exercise physiology degree and since then I have been working in landscape construction because my degree couldn’t pay the bills. I was in a really bad place as far as my outlook and hope for the future. I literally spent 40+ hours a week digging in the dirt and I make $17 dollars an hour. Basically my life sucked and I started to think this was going to be my lot in life. Enter LMM. I started listening to your podcast during work, and couldn’t stop because it gave me hope and actually gave me ideas for change in my life. I started to implement different ideas from your shows, and started to effect change. For the first time ever I really started to save effectively and was able to save up about $6000, which isn’t bad for someone on $17 dollars an hour. The next milestone was to invest in myself and so I joined an on line coding boot camp with all the money I had saved. I took 2 days off per week to provide myself enough time to succeed. This work reduction has resulted in an effective 40% loss in my earnings. Needless to say times have been tough on the money front but we are surviving. I am done with my boot camp and on March 30th I had my first technical interview with a company, and I have one more lined up for next week. I cannot tell you how excited about life I am now, and how much hope I have for me and the future of my family. And getting a “real” job is not the end for me and my goals but is simply the beginning of a journey of self improvement. I love you guys in the non weirdest way possible and am thankful for the effort that you have put forth in producing the best podcast out there.” A Chance to Fail in Order to Succeed The person who sent that e-mail took a big risk. Why would someone with four children to feed do that? He did it because he knew he would succeed. Why? Because he had no choice. He has four children to feed. Getting out of your comfort zone and into a place where you have no choice but to succeed is the quickest kick in the ass you will ever get. Our e-mailer cut back his work hours and the money he was earning to learn something new that will make him more money. I moved to New Orleans where I didn’t know a soul. Thomas moved to Denver which quadrupled his rent overnight. All three of us are making it because it was the only choice we had. Not everyone is going to have a major catalyst for quitting a job, moving, or having a kid to motivate them. Those things are certainly among the best motivators but they aren’t the only ones. Maybe your motivation is finally getting tired of doing the same damn thing over and over. You’re tired of living paycheck to paycheck. You’re tired of being in credit card debt. You’re tired of paying someone else to rent and want to buy your own home. Just Do It We all have things we know we should be doing but we aren’t doin...

Good personal finance habits start young. Today you’ll learn how to make your kid a money master with Eva Baker. Our children don’t get much personal finance education in school so it’s up to parents to provide that education. There are things we can do throughout their childhood to turn our kid into a money master. Teens Got Cents Eva started Teens Got Cents as a home school project. Her mother started listening to audio books by Dave Ramsey and Eva got interested in personal finance because she never wanted to have to dig herself out of the kind of hole those who need Dave Ramsey have gotten into. She started doing some research but found that most information was geared toward adults and there wasn’t much to help kids. Eva saw a gap and decided to fill it and that’s how her site started when she was just 16. Eva blogs about how teens can shop smart, get a great part time job, go to college debt free, save money, and start their own business. In 2015 she founded The Teenpreneur Conference. This annual conference brings together teen business owners as well as teens who want to start their own business in a community that truly is by teens, for teens. Kids Notice Even very young kids notice things happening around them and are interested in them. If you’ve ever had a kid who used a swear word they overheard you say at an inopportune moment, you know just how much they absorb, even if you don’t think they’re paying attention. If your kid only ever sees you swipe a credit card to pay for things, they notice. What they might notice is that money is infinite. A little kid can understand that if you have $1 and you spend that dollar, it’s gone. You handed it over to the cashier and they kept it. When you swipe that card, the cashier hands it back every time so obviously, you can buy an infinite amount of things as long as you have one of those magical cards! Ages 5-8 Even kids this young can absorb personal finance lessons. And some of those lessons are best taught at this age because any mistakes the children make will be minor and not life to destroy like they can be later in life. The envelope system is a great way to teach kids how to budget. Give your kid three envelopes, one for spending, saving, and giving. Let them decorate each envelope in a way that represents what each one is for. Some parents give allowance like Universal Basic Income. The kids get a certain amount of money just for existing. Some parents give money in exchange for chores and some combine the two; the kids get a certain amount of allowance independent of chores but can make more if they do chores. The envelope system is great for little kids because it lets them see the cash and see when the cash is gone. There are a few ways to implement the system. Some parents insist that the money is split evenly between the envelopes. Some let the children divvy up the money any way that want so long as each envelope gets some portion. Buy your child a wallet to keep their spending money in. When you go shopping with them and they want to buy something, you can use it as a teaching moment. Maybe they want to buy more than one thing but don’t have the money for all they want to buy. You can explain that no one has the money for everything they want so they have to make a choice. If they want something they don’t have money for you can explain that they need to save up to buy it. You can offer to let them to chores to earn extra money to buy that thing. This shows that we have to delay gratification and work in order to afford the things we want. For kids this small, some extra parental input is needed when decidi...

Do you hate making a decision? Sometimes the fear of making a decision means we miss out on a good opportunity. Today we will get you off the fence and show you how to master the decision making process with Matt Bodnar. We make dozens of decisions every day. Some of them are minor like what to wear to work, and some are major like deciding between buying a rental property or a house to live in. When you learn to master the decision-making process you can improve every aspect of your life, your job, your health, your relationships and not least of all, your finances. A Fellow Podcaster Matt Bodnar, named to Forbes “30 Under 30 List,” has been called a “Rising Restaurateur Star” by the National Restaurant Association and a “Strategy Pro” by Restaurant Hospitality Magazine. He is a partner at early stage investment firm Fresh Hospitality where he focuses on deal-making and strategy. Matt is also the creator and host of “The Science of Success” a #1 New & Noteworthy podcast, with almost one million downloads. The podcast is focused on improving decision-making, understanding psychology, and sharing insights from experts. Matt previously worked as an import/export consultant in Nanjing, China and spent several years at Goldman Sachs before returning to his family roots in the hospitality space. The Great Investors Matt became very interested in what commonalities the world’s great investors like Warren Buffett and Charlie Munger had in common. Was it that they were smarter than everyone else? Was the ability to make money through investing some innate trait they were merely born with? Through his research, Matt concluded the one thing not only all great investors but all successful people in any pursuit shared was the ability to make the right decisions. Compound Decisions We know how powerful compounding interest is when it comes to growing our money. We can use that same power when it comes to improving our decision-making abilities. If we strive to make our decisions just 1% better each day, every part of our lives those decisions touch will improve. How do you make that 1% improvement? By having as much information as you can, that will help make a decision. If you’re trying to decide between two job offers you want to know what the pay is, what the benefits, both financial (401k, insurance benefits) and non-monetary (vacation time, flex scheduling, telecommuting) are. What is the culture like at each company? What do you want out of a new job? Really grill yourself when you have to make a decision so you can pull out the answers that will help you make the correct decision. Analysis Paralysis Have you ever gone clothes shopping knowing that you need new clothes but without much of an idea of what you want to buy? You spend forever looking and may come away with nothing. That can happen when we don’t have a plan and are faced with too many choices. Analysis paralysis can be, well, paralyzing. We have so many choices and so much information at our fingertips. When you are trying to pick a stock there is more information available than you could read and much of it; maybe you won’t even understand. But you still have to choose.  So you go back to asking yourself questions. Does this company make a product I believe in? Does this company act in ways that align with my ethics? By asking these kinds of questions, you can start to narrow your list of choices down until the right choice becomes obvious.

We love robo-advisors, and lots of other investors do too. But admittedly, robo-advisors are missing that personal touch some investors prefer. We found the best of both worlds in Wealthsimple. This is our Wealthsimple review along with a chat with CEO Michael Katchen. Ancestry and Investing Michael joined 1000 Memories soon after the company was founded in 2010. It was a site that allowed people to organize and share old family photos and memories and to create family trees. in 2013 the company was sold to Ancestry.com. When the business was sold, Michael’s coworkers came to him for advice on how to invest the money. He had been investing for years and believed that managing your own money was possible and pretty straightforward. He shared his method with his friends. It wasn’t quite easy enough for them. They wanted someone else to do the work of investing for them. With a small pool of ready-made customers, Michael decided to start the Canadian fintech company Wealthsimple. He set out to create a Vanguard for millennials and make investing simple and straightforward. The Human Component The whole point of Robo-advisors is to take humans largely out of the process. Most don’t offer tailored investing advice. Wealthsimple does offer that. The company is a hybrid of traditional financial advisors and Robo-advisors. The more money you have invested with Wealthsimple, the more services you can access but anyone with an account can call and have their financial questions answered. Take the Emotion Out of Investing Investors are often their own worst enemies. The market falls and people panic and start selling. Buy and hold always wins when it comes to investing. Ignorance helps stoke the fear that causes investors to make poor decisions. Wealthsimple combats that by teaching their clients the basics of good investing; start investing early, contribute to your investment accounts regularly, and make sure your investments are diversified. When investors are successful, the company they invest with is successful too, so Wealthsimple wants to help create educated, successful investors who make decisions based on information and not based on fear. Wealthsimple Review As Michael explained, educating customers is a critical component of Wealthsimple’s business. And that is evident all over the site. Right on the front page is a slider you can play with to see how much your money will grow when you start with $X and invest $X each month. You can set up an auto-deposit every month, so you don’t even have to think about investing, it just happens. Fees The fees are right on the front page too, so you don’t have to hunt around for them as you do with some other investment companies. There are two tiers, and you can see what features come with each. For those investing between $0-100,000, the fee is 0.5%. If you have less than $5,000 invested, the first year is free. For those with accounts higher than $100,000, you can open a Wealthsimple black account it’s 0.4%. To qualify for unlimited personal advice at Betterment, there is a $250,000 account minimum, and the fee is 0.50%. Portfolio Type The educating continues on the Details page.

Lots of us dream about turning our passion into a money-making business, and it can be done! In our on-going series about starting an online business, we discuss monetizing your passion and building your business. Remember, our goal is to earn at least $1,000 a month by month 12 of your business and to see a clear trend towards growth. If you quit your job to work on this business full time, that’s not a lot. If you still have your full-time job, bringing in an extra $12,000 a year is pretty great. Test Your Hypothesis You know what you want to do. Before you put any more time and effort into it, you need to find out if anyone will pay you for it. Ask anyone you know and people you don’t via small business forums, conferences, and trade shows if they would pay for what you’re selling. Get a minimal viable product out the door. You can tinker with something forever, but the feedback you get when you push something out into public is much more valuable and takes much less time. Once you have some feedback, tweak your product based on that data. Build a simple website where potential customers can get more information about your product. Tim Ferris recommends Facebook ads to target your particular market. Will They Pay? Great, your idea has created some interest. You’re excited! Don’t get too excited yet. There is only one type of validation that matters when it comes to your business. 1,000 email subscribers are not validation. 1,000 free customers are not validation. Money is validation. If people are willing to pay money for what you are offering, it’s because you are providing them value. That’s why it’s important to charge for your product from Day 1 or as close to Day 1 as possible. Unless you are slinging dope, the marketing strategy of giving it away for free at first knowing they will pay because they have to have what you’re selling, doesn’t work. There are plenty of things people like and enjoy but will walk away from the second there is a cost involved if they’re accustomed to getting that thing for free. If people are paying money for what you’re doing, then you are providing value. Charge from Day 1 or as close to Day 1 as possible. Getting Past the Fear Don’t be afraid to charge for your product and to charge what it is worth, not just what you think people will pay. You’re afraid to charge for all the wrong reasons. Andrew recently gave me some advice on pricing that was a light bulb moment. $100 won’t change my life. $1,000 might. I was afraid to turn down work even if it wasn’t paying good or even decent money. But it’s better to have five clients who will pay you $1,000 than 25 clients paying you $20. The fewer clients you have, the more time you can devote to them and the higher the quality of your work will be. Whether I am charging $1, $100, or $1,000, it takes me the same amount of time to do the work. So why am I going to waste my time for a lousy $1 or $100? I’m not. I was, but not after that piece of advice. You shouldn’t either. Price for the customers you want. We’ve all dealt with extremely cheap people. For some reason, they also tend to be the most demanding people. More meals probably get sent back at Applebee’s than Jean George. People often undervalue things that are free or cheap. It’s why people are more likely to take care of a brand new car they bought for themselves than a used car handed down from a family member. In our episode on negotiation, we emphasized that if you quote a price higher than the client wants to pay, they are not likely to walk away entirely. They approached you; they already want to buy your product.

Part of starting a business is having a business plan. It doesn’t have to be complicated. We’ll discuss creating a simple one page business plan. A business plan can be a scary term conjuring images of thirty-page documents. But it doesn’t have to be that involved. It’s just writing down what you have to get done and a simple one page business plan is a great place to start. One Page Business Plan Basics A simple one page business plan is nothing more than a map for your business that gives an outline of your goals and the steps you will take to achieve those goals. It’s not that different from having a plan to accomplish any goal. If your goal is to pay off debt, you would outline a plan on how to do that; reduce spending by eliminating dinners out and taking lunch to work, do a balance transfer to lower interest rates, use the snowball or stacking method to determine which debt to work on first. Voila, you just wrote a one page business plan for paying off debt. Having a long, detailed, formal business plan is really only necessary for businesses looking for investors or to show a bank to get a business loan. A one page business plan isn’t going to cut it. Business Plan Template Your one page business plan should fit on one page and include the following: * A problem you have identified. * How your product or service can solve that problem. * How you would make money. * Who your customers are and how many of them are there. * What separates you from those already doing what you plan to do. * How much it will cost to start your business. * How much runway you have. The Money Part This is the hard part. Depending on the type of business you want to start, you may have a pages long list of things you need to buy or really no list at all. You need to make two lists, one for your own personal cash needs and one for the cash needs of the business. Here are some common expenses for each: Personal Needs * Rent * Utilities * Food on the table * Gas for the car Specific to the Business * Start-up costs * Equipment * Build out * Insurance * Licenses * Deposits * Inventory * Accountants * Lawyers * Burn rate: (how long can you last?) * Rent * Utilities * Cost of labor (employees or contractors) * Financing * Advertising You will already know the numbers for the things on the personal requirements list. And some of the ones on the start-up expenses list you can easily find too like rent and insurance costs. Others you are going to have to estimate the best you can by doing a crazy amount of research. Based on that research, you can make assumptions that will give you numbers to work with. You should make your initial costs as lean as you can. Office space would be nice, but it’s not essential if you’re on a tight budget. That reduces rent expenses and utility expenses. Hiring dedicated employees would be nice but could freelancers do the same jobs in the beginning? Your Numbers There are some basic numbers you want to calculate as part of your simple one page business plan. Running Room Running room or runway is how much cash you need to have until your business starts to make money. This is your deadline for making a profit. This is probably less money than you imagine. More than 40% of small businesses are started for less than $5,000 and 64% started with less than $10,000. Break Even Number

If you want to start a business what kind do you want it to be? There are two competing business philosophies: lifestyle business vs. growth-minded business. Lifestyle Business A lifestyle business isn’t intended to make the owner tons of money. The goal of a lifestyle business is to make enough money to be comfortable while having freedom and a good work-life balance while doing work that you enjoy. Many lifestyle businesses were started based on the owner’s particular hobby or passion and represent their personal values. Online businesses are much more amenable to this kind of business. A brick and mortar business offers much less freedom. Lifestyle businesses are self-funded, and that adds another layer of freedom. You aren’t beholden to VC funders or shareholders. This also you complete control over your business. Benefits of a Lifestyle Business Because your business is set up around your life, there is no guilt when you take time off or put other things like family or travel above growing the business. You work to live rather than living to work. Because of this balance, lifestyle business owners don’t suffer from the high levels of burnout, stress, and health problems that growth-minded business owners often face. Growth Minded  Business When you think of the startup world, you typically think of founders who are working like mad to grow their companies as fast as possible. Often, the founder or founders will get their company to the point where there’s enough promise to attract funding. And at that point, you’ve got investors who now want to see an ROI – and in the startup game, they’re not looking for a modest ROI, they’re looking for “to-the-moon” businesses. This is the growth-minded business model. Benefits of a Growth-Minded Business Let’s face it – if you’re not growing, you’re shrinking. There’s always someone out there trying to eat your lunch. A more laid-back lifestyle business model carries a much greater threat of being eclipsed by competition, which could land you right back at a desk job. Adopting a growth mindset is more likely to expose you to other incredibly motivated, driven people who will push you to do more.  A growth mindset is more likely to result in a company that makes a truly big impact on the world. Accepting funding reduces your personal risk and can supercharge the growth of your business. Middle Ground Of course, there’s also a middle ground between the two extremes, and it’s probably occupied by more businesses than either of them. Millions of small businesses have founders who work hard, seek to grow, but mainly just look at it like a job. They’re not looking to work from a beach, but they’re also not hoping to pitch Chris Sacca next week. So if you’re thinking of starting a business, and you’re hoping that it could one day allow you to quit your job, which model do you go for? Which is Right For You? Both choices are going to require a lot of work up front. You hear lots of stories about lifestyle business owners who turned a hobby or side hustle into a job that supports them full time. But in the vast majority of cases, they spent years building that business while working full time because they didn’t want to take outside funding. But a successful lifestyle business doesn’t require a ton of work once it’s up and running successfully. Andrew now spends from 4-20 hours a week on LMM. But there are times when he spends 0 hours working on it because he’s on vacation or just feeling burnt out and needs a break. You likely won’t become a multi-millionaire running a lifestyle business...

We’re continuing online business month with an interview  with Corbett Barr on how to build a business Fizzle Andrew and our original co-host Matt met through Fizzle. Fizzle is a community and video training library for entrepreneurs. There are 40 courses in the library that teach people how to build an online business and get it up and running. Fizzle encourages you to create something you’re proud of through hard work and persistence. The site isn’t full of “20 Amazing hacks to start a business overnight and become a billionaire” content. It offers long-term advice that will help people grow a business. Is Anyone Out There? Why do some sites take off and others languish in obscurity? Getting what you do in front of people is as important, maybe more important, than what you create. If a tree falls in the forest and no one is there to hear it, does it make a sound? You want your tree to be heard. You need other people to help you get heard. Work at building relationships with the rising stars in your field. Corbett rattled off a list of who’s who in the online business space, all of whom he knew before they really blew up. Join forums, go to networking events and connect with as many people as you can. Relationships matter. Especially when you feel like you’re shouting into the void. The people in your day to day life may not understand why you’re devoting so much time and energy to something that seems to be going nowhere. The like-minded you people do understand and can help keep you aloft when you want to give up and everyone else is discouraging you from continuing. The Magic Formula Entrepreneurship and personal finance have a lot of parallels. The magic formula for growing wealth is really not that magical. Make more money than you spend and invest your money. Viola, wealth! It’s not easy but it is simple. Having a successful business has a magic formula too. Identify a group of people who have a need that is not being filled and find a way to fill it that those people will pay money for. Again, not easy but simple. Even if you think the area you want to jump into is saturated, there is always room for one more. There are tons of cooking blogs. There are tons of vegan cooking blogs. So how could you stand out in that space? Thug Kitchen separated themselves from the pack with lots and lots of swearing. It took two things that can really take themselves too seriously, cooking and veganism, and made them funny and naughty. Just like LMM, you can approach a serious subject in a non-serious, entertaining way. I’m Paleo but I still read Thug Kitchen and occasionally even cook from it because it’s funny and the recipes are good. I just top them with a steak. It might sound ridiculous to you but that site has spun into three cookbooks one of which has been a New York Times Best Seller. They were able to stand out in a very crowded space. Putting something of yourself into your work can help you stand apart. For LMM that was Andrew drinking and swearing during the pod. I know him in real life and how he acts on the pod is how is in real life. The duo behind Thug Kitchen write how they speak when they’re with friends. Quality Not Quantity Most of us starting an online business are going to do it while we work a regular job and we have plenty of other things that need our attention too like friends and family. That can be an advantage. When we only have a limited amount of time to spend on something, we are more likely to focus and work on the things that really matter. If you have two hours a day to spend on your project, you are not going to spend it pouring over WordPress templates looking for the perfect one.