Compound interest is when the money made from investments, or the the growth of an investment, is immediately reinvested. If an investment of $100 have an average growth of 10%, the value would be $110 in a year. That’s an increase of $10. The next year, the investment would grow 10% again. But this time, it would be 10% of our $110 principal, which is an $11 increase.

November 13th, 2021

This will be a short article, and honestly, rightfully so. For far too long, life insurance has been made overly complicated, expensive, highly-profitable to the selling company and advisor, and of little-to-no benefit to the consumer in most cases. When people hear “life insurance salesman” they tend to shy away. That’s why they started calling themselves financial advisors. Well, the title of financial advisor is starting to gain the same negative connotation. I expect them to change their title to something like “Personal Wealth Literacy Coach” or some other garbage in the near future. I digress - in reality, life insurance is designed to protect your loved ones when your time runs out and you ultimately meet the man upstairs.

November 3rd, 2021

Health Savings Accounts, or more commonly known as HSAs, are a tax haven hidden in plain sight. HSAs are paired with what the IRS determines to be “High Deductible Health Plans” or HDHPs. For 2021, these plans were required to have a minimum deductible of $1400 for an individual and $2800 for a family. If your plan meets these requirements and is categorized as an HDHP plan, you are eligible to contribute to a HSA. Note that there are more complicated requirements for families with one HDHP and one non-HDHP health plan.

October 20th, 2021

The title of this article sums up exactly what we’ll be doing here. I truly hope everyone can gain a solid understanding of all the fees they pay on investments, because as the value of your assets increase, the fees become very, very noticeable. Paying 2% total fees on $50k is one thing, but try doing it on $2MM. In this article we’re going to explain the various types of fees, where you can expect to pay them, and how you can avoid them. We will also break down the numbers so you can understand the impact. I know, you came here looking for the numbers, so we’ll give them to you!

October 10th, 2021

In my honest opinion, yearly checkups are a very good thing when it comes to personal finance. If you don’t compare yourself against yourself, how do you know how you’re doing?

September 29th, 2021

You can’t peruse Google without seeing references to the failing Social Security Trust Fund. So you’re probably wondering, what is Social Security anyhow? Well, it’s something you should definitely keep tabs on for the sake of estimating your retirement.

September 20th, 2021

If you search for a “buy stocks” or “open a Roth IRA” on the internet, you’ll find that there are a couple less than a million brokerages out there. Literally, there are a TON! Rather than having you start fresh in your search, we’ll try to give you some direction.

September 11th, 2021

This is my biggest pet peeve in all of personal finance. Every single day I hear someone misuse one of these terms. Every. Single. Day. Well, it needs to come to an end so I’m gonna do my best here. 

September 4th, 2021

This will be short and sweet, just the way we like it here at Wealthy idiots. I’ve been asked by a few people to list my preferred order for retirement account contributions, so here they are. Note that these are assuming the investor doesn’t have any outstanding bad debt.

August 26th, 2021

The Financial Independence, Retire Early movement, also known as ‘FIRE’, is exactly what it sounds like. Earn as much money as quickly as possible so you can pull the plug and stop working for “the man” as soon as possible. For many, their goal is to retire as early as their thirties. Personally, I think this is utterly ridiculous and continue reading to learn why!

August 22nd, 2021

You have probably heard someone mention compound interest at one point or another, at least I hope. Either way, we’ll do our best to catch you up on the topic and even provide you with an awesome tool to help out!

August 15th, 2021

I’ve seen a ton of articles lately on the projected 6.2% Cost of Living Adjustment (COLA) that will be afforded to many local, state, federal, railroad, and military pension (including VA benefits) recipients, and Social Security beneficiaries. Let’s talk about why this may not be a good thing like many people believe.

August 8th, 2021

It is fairly often that I hear someone say their money isn’t in the stock market because they could lose it all. Instead, they prefer to place their money in high-yield savings accounts (HYSAs), CDs, or a super-conservative fixed income fund. Let’s talk about why this thinking is flawed and how it can guarantee a failure to launch for your retirement.

July 31st, 2021

Here at Wealthy Idiots, we’ll often be talking about how much you should be trying to save each paycheck, and while you’re reading that, you may be overwhelmed thinking about how daunting it seems. Well, there are some small tricks that can help you along the way.

July 8th, 2021

As my daughter Sierra was entering college, she and I were discussing the merits of a higher education. I supported her decision, but told her that I felt college was not necessary and that she would be better off getting her education from moi 😄 (yeah, I was trying to push her buttons). Not surprisingly, she was taken aback by my comment and blurted, “Dad, I can’t believe you don’t think I should go to college!?” “Baby girl, one, college is not for everyone, and I happen to believe you fall into this category (yeah, I crack myself up), and two, the cost of going to college often does not outweigh the benefits”. You may think that I was trying to save me and her momma \$120k by not sending her to college, but I promise you that I had a very reasoned scenario to substantiate my claim, which I shared with her.

July 5th, 2021

Earlier this year I wrote an article, The path to early (Age 57) retirement; long-term rental properties, about my wife and I starting our rental property journey in the hopes that we can generate passive cash flow for retirement. In the time since, we’ve been scouring the local market looking for our next deal! After two months of searching, we finally found it and couldn’t be happier.

June 27th, 2021

You’ll hear both AJ and I talk about this a TON! Net worth, or NW as it’s often referred, is a total measure of your financial health. Okay, so it’s not the total picture, but it is a very important one. Net worth, paired with other things like debt to income (DTI) ratio and savings rate, can give you a really good idea of where you stand financially.

June 20th, 2021

As you follow along with us in the future, you will quickly realize how much we stress the importance of retirement savings. This is for various reasons including the present-day tax savings, achieving the “set it and forget it” mindset, diversity, etc. If you are new to this, the vast array of choices can be kind of intimidating. I’m going to summarize the most common types of retirement accounts below, hopefully opening your eyes to a world of possibilities!

June 12th, 2021

If there is one guaranteed, sure-fire way to keep the poor down, it’s property taxes. Just think, you spend 30 years working hard to pay off your home. You’ve finally made it. You have achieved the American dream - homeownership. But wait, you don’t “technically” own your home. It’s crazy, right? Well, not really. After all those years of making timely payments, the government still holds a controlling stake in your property, and honestly, they will forever. Keep reading as we talk about some ways to lessen the blow of these taxes.

June 6th, 2021

I was stuck at a job that I didn’t care about with a boss whom I hated, so when I was approached with a job opportunity on LinkedIn, I desperately thought, “Why not?” The recruiter kept talking about how the role “bridges the gap between finance and healthcare” - two things I’m passionate about. But that’s where the positives ended. He refused to disclose the name of the company, dodged most of my questions and kept calling this opportunity huge and incredible. He brought his mentor into the process, who supposedly made $300k/year (in other words, she’s at the top of the pyramid scheme), and of course he saw that same potential in me (based on what, I’m not sure).

May 31st, 2021

If there is one guaranteed, sure-fire way to keep the poor down, it’s property taxes. Just think, you spend 30 years working hard to pay off your home. You’ve finally made it. You have achieved the American dream - homeownership. But wait, you don’t “technically” own your home. It’s crazy, right? Well, not really. After all those years of making timely payments, the government still holds a controlling stake in your property, and honestly, they will forever. Keep reading as we talk about some ways to lessen the blow of these taxes.

May 17th, 2021

Watercooler or coffee pot talk is always rampant at every workplace. You’ll hear various soundbites about literally everything, from who the greatest quarterback of all time is (Tom Brady), to who the best actor is (Denzel Washington). No matter what the topic, everyone will have a different opinion and that’s both good and bad. The good part - you’ll be introduced to tons of different ideas. The bad part - you’ll probably get some TERRIBLE financial advice that is very jaded because no one will share their ACTUAL situation, but rather a hypothetical that is ripe for failure. Heck, someone might even refer you to their “money guy/gal”. Below, I’ll discuss some Wealthy Idiot ideas you can bring to that watercooler/coffee pot to impress your co-workers!

May 7th, 2021

The word ‘debt’ just sounds bad. It has such a strong negative connotation in society, yet, people are overtly encouraged to saddle themselves with as much of it as possible, and in some cases, even more than is possible. Not all forms of debt are bad, and some forms are actually good, so we’ll give you an overview of some of these different types of debt.

April 28th, 2021

When you hear ‘tax law change’ you probably freak out and start imagining the IRS taxing your food, or possibly your water, or maybe your 1967 Chevelle you just purchased (oh wait, the IRS already taxes all of those!). Well, don’t fret, because the IRS has good news this time. Read on for a very simple way to lessen the financial blow of childcare (no, it’s not putting your kids up for adoption).

April 21st, 2021

If there is one thing we can agree on, it is that everyone has an opinion, they are often different, and just because someone has their own opinion that they’re very passionate about doesn’t make them right. Heck, not everything you read on this site is “right”, depending on individual perspectives. Rather, based on our own experiences and research we believe it is “most preferred”, but we can’t stick a flag in the ground and lay our claim to being the only guys on the internet that are “right”. That’s just not possible in 2021. But what we can do is discuss some of these myths that surround retirement savings. We can put them out in the open and see how it all shakes out.

April 11th, 2021

I have been extremely passionate about personal finance for the past 7 years. In 2014, I started doing a ton of reading and finally started my Roth IRA. Shortly after, personal finance became a passion that I can’t seem to ignore. Today, I do everything I can to learn as much as possible. I don’t accept financial mediocrity in any way. If there is a way to squeeze out an extra \$100 per month in income, I’ll work to find it. So, after plenty of roads traveled, I have landed on long-term rental properties as my next venture. With that said, I can’t continue on without crediting AJ with giving me the extra push to overcome my “analysis paralysis” as they call it. That’s enough background, let’s get into it.

March 27th, 2021

First thing’s first… you’re PREGNANT! Congratulations! This is an incredible time in your life and your body will amaze you. You’re nauseated, but so excited! If you have the opportunity, you should enjoy your sleep now before it becomes sparse. Soon everyone will start in with the “babies are so expensive” talk. But what they don’t tell you is what exactly is so expensive. They bring up diapers and such... but what about birth? That’s another expense that you will want to prepare your family for. Unless you have a baby unassisted in the living room during family dinner on Sunday, you should expect some medical bills resulting from childbirth. Read on for some tips on how to prepare!

March 21st, 2021

This article is about, you guessed it, how to fire your financial advisor (FA) and manage your own investments! I’ll show you how to spend lots of money on study materials, cram for that big certification exam, pass the certification exam, and finally, know more about personal finance than all your friends. FALSE. I won’t do any of this, and it’s all utterly ridiculous.

March 12th, 2021

Ah, the long-awaited stimulus payment. On Friday, POTUS signed the bill which contains the third round of stimulus payments. For the past three weeks, you’ve searched ‘Stimulus Check’ or some variation of it in your search bar. You stand in wonder each morning thinking of how you’ll spend that $1,400, or $7,000 in some cases, while you sip your fresh coffee. Maybe it’s finally time you buy-in to that pyramid scheme you’ve been eying (JOKING - don’t do this, please), or maybe you don’t need the money at all so you’re going to buy Tesla stock! Either way, we’ve got you covered here at Wealthy Idiots.

March 5th, 2021

As I talked about in part one, a big trend amongst the ambitious younger generations has been finding a side hustle. A side hustle can range from dog sitting to developing web applications. I decided to become a Real Estate Agent as mine.

February 27th, 2021

The EF (Emergency Fund) is one of the foundations of personal finance. The EF allows you to sleep soundly at night knowing your lifestyle and loved ones are protected. Whether it be from job loss, or an unexpected illness, having the ability to pay 4-6 month of expenses with savings is a game changer. Because of this, you want the EF to be invested in something fairly liquid - meaning, you can withdraw the funds quickly in order to pay for the emergency expense. You also want to ensure the EF isn’t invested in too risky of funds, or the money may not be there when you need it.

February 20th, 2021

One of the trends amongst the ambitious younger generations has been finding a side hustle. A side hustle can range from dog sitting to developing web applications. I decided to become a Real Estate Agent as mine.

February 14th, 2021

If you are only going to read one of the articles here at The Wealthy Idiots (ha, not possible!), this is the one you must read! You’ve probably heard people mention a Roth IRA and that’s because it’s the gold standard of retirement tools. The Roth IRA is the whole shebang. It is easy to open, simple to operate, diverse, and has super low fees (which we’ll talk about more in future articles). Oh yeah, and depending on how you structure your financial planning, the Roth IRA could account for a “bucket” of income in retirement… a bucket of TAX FREE INCOME! Let’s jump into the specifics!

February 6th, 2021

One thing you’ll quickly realize in your personal finance journey, is that everyone has an opinion on the matter. Well, I guess everyone has an opinion on everything, even if they state “no opinion”. Nonetheless, people are very vocal about personal finance. You can probably compare “my investment guy is the best, you should talk to him”, with “we’re not like a normal church, it’s completely different here!” Here are some of the “opinions” you can expect to hear.

February 4th, 2021

I was one of those kids that was born into a “set-in-stone” family banking relationship. Both my parents had accounts with the same large bank, so once I was old enough for a bank account of my own, this made the choice simple for me and my parents. By using the same bank it was easier for them to transfer my allowance, or withdraw my monthly phone bill once they deemed me old enough to start paying for it (ouch).

January 31st, 2021

In today’s climate, it is easier than ever to secure a historically low mortgage rate. With thousands of lenders to choose from, borrowers have more choices than ever. This allows better rate shopping, varying lender credits, and sometimes waivers for appraisal and other items based on your current situation.

January 23rd, 2021

Each year, the IRS specifies contribution limits for retirement accounts. These limits, based on inflation data from the year prior, determine how much a person (and their company in some instances) can contribute to a given plan. Below, we’ll quickly go over the limits for the common retirement accounts.

January 17th, 2021

If there is any certainty entering 2021 with a new Presidential administration in the U.S., it’s that American’s will likely be receiving another stimulus check in the near future. Rather than discuss the specifics, or the politics, we’re going to talk about how the stimulus checks have been structured in the past, and how you can best align yourself for the maximum benefit in the future.

November 29th, 2020

Taxes are a topic that very few people understand. I constantly hear the terms credit, deduction, and write-off, all intermingled in an incoherent way that is certain to signal a lack of tax code understanding. I can’t tell you how many times a married friend or co-worker has said, “man, this mortgage interest is really helping me on my taxes”, not understanding that they would need to deduct approximately $25k in said interest in order to change their tax situation (barring other large deductions).

November 3rd, 2020

We can debate the finer mechanics of personal finance for what would seem like eternity. Questions like asset allocation (AA), stocks vs. bonds, 401(k) vs. Roth 401(k), etc. will live on for years. The question of savings rate, however, is about as cut and dry as America having an uptick in small digit amputations on Independence Day.

October 14th, 2020

Here at The Wealthy Idiots, we have 8 rules that we abide by. We call these our truths. This isn’t financial advice, but it is our own finely tuned algorithm (A.J. Sheff approves of IT term usage), that we use to maximize our financial prosperity. God, I love the word prosperity.