840: It's Only Money by Craig Stephens of Retire Before Dad on Building Financial Security


This is optimal finance daily episode eight forty. It's only money by Craig Stevens of retire before dad dot com. And I am, Dan. I'm your hosts happy Friday to you. Hope you've had a great week and I've got a new author and new website today. The site is retire before dad dot com, and we got to meet Craig Finn con- this year, and he's got a bunch of helpful articles on his site, including some great reviews and resources. So check it out at retire before dad dot com, and with that let's hear our first post from Craig and start. Optimizing your life. It's only money by Craig Stevens of retire before dad dot com. Every week I write about money, sometimes in a roundabout way. But ultimately, this website is about growing wealth by making better financial decisions life is not about money, but money can help us live, a better life when you're living paycheck to paycheck, unexpected expenses can be extremely stressful. The news of a major home repair or car problem can be serious punch in the gut when you're just trying to get by it hurts when you're aggressively building wealth, or living off your savings to. That's why it's good practice to prepare for financial calamities by building an emergency fund. In addition to proper insurance coverage. But as hurtful and stressful as a big expense may be, it's only money. It's not a threat to life for health and doesn't need to threaten relationships or true happiness. Those are the things that really matter lunch with a pseudo mentor, the title of this post comes from a conversation. I had years ago with a former manager this person was perfectly situated to be a mentor, but I disagreed with him about how to conduct business. At many stages of our relationship because of this. I never considered him a mentor. I learned from his mistakes more than successes. Things were always going wrong, and he would often consider himself the victim. The mistakes were usually in the form of trusting people without a legal agreement, trusting without verifying or assuming some business would commence that was never finalized one day during lunch. He told me that a project suffered a large contract loss. The loss was a major blow to revenue when I realized the gravity of this loss. I said something like that sucks. I assume that someone had screwed him again, and was about to hear another tale of woe, but instead his response took me by surprise. He said, it's only money and that was that he was over it. He may have taken that line from an old movie. Turns out he was having a difficult year with family health problems. The blip in the business road wasn't nearly as devastating as what he was dealing with outside of work, money wasn't important to him at that particular moment. Life went on why I'm increasing. Emergency fund recent events have convinced me that I need to increase the amount in my money market account. The interest rate for my new high yield savings account is now above two percent. So I was planning to increase it somewhat anyways. But more importantly, I've realized that I don't have enough cash available to pay for a major home repair. We've been lucky for the past seven years at both our home and rental property, no major repairs aside, from some brickwork. I used to think about my emergency fund as a backstop in case. I lost my job. This was tested late last year and a use the fund to keep us afloat. But my parents recently had to back to back, costly home repairs that changed my thinking if something similar would happen to us we'd have to borrow from other sources at my parents house, the plumbing that takes the wastewater out of the house had a major clog in the basement from decades of use the plumbers had to bring in the jackhammer dig up the basement floor and a whole outside the house to replace the pipe. It was a big messy job and expensive insurance will cover some of the repairs, but it's going to hit. My parents emergency fund hard, then two weeks ago after the plumbing problems, a seventy foot tree fell from a neighbor's yard toppled a significant tree in my parents yard like a domino. Then down some big branches from the neighbor's. Tree crushed defense. Then snapped an old telephone pole with a basketball hoop on it. All on a calm and sunny day, the description and pictures, don't do it Justice. They tell me thankfully, my dad wasn't mowing at the time. Now there's a huge mess. It's going to take a ton of manual labor to remove all the wood. Then hollowed out of the yard. It's down a big hill. Difficult to get to street level, that's going to cost a decent chunk to my parents have the cash on hand, but we would not be able to cover both problems if they happened concurrently for us. Our properties are newer, my parents home was built in nineteen forties. But the events still make me want to have more financial control over the next calamitous home repair. As of today are liquid reserves are insufficient savings, segmentation, not long ago, I wrote about how to manage excess cash. Flo. When income outpaces expenses for the month, I segment our savings into different pools of occasion, fund a car savings fund as a result of swearing off car payments, and our general fund, which also serves as the emergency fund combined, these funds should be able to cover any major home repairs, when push comes to shove, but that would defeat the purpose of allocating money for specific purposes. The vacation fund were building is already budgeted for a family trip next year. The car fund is still growing, so I can buy a brand new car in for years or so what I think needs to happen. And this is just becoming apparent as I write this is I need to create a separate segmentation for emergency savings. Then load that up to a certain level three to six months expenses, plus and use the general savings fund, almost exclusively for investing the dilemma, I face is that my overall cash holdings will be much larger than today, usually I want to use most of that to build income streams, but I guess I'm becoming more risk averse in my forties. The other downside is while I. Build up the emergency fund less money will be available to invest having a high yield money market account at my disposal, alleviates, this dilemma, somewhat because Al earn a return on par with some of my dividend growth stocks, though without the capital appreciation or risk. But I'm not ready to stop investing new capital in order to build the fund more rapidly. So I'll be gradually increasing our cash pool until meeting, a to be determined arbitrary level of cash where I'm comfortable. It's only money one reader recently called a post of mine philosophical, I get annoyed. When bloggers get to philosophical. So I try to avoid that when I can. But I write so much that sometimes I can't help. But go in that direction and I'm about to again spending so much time thinking about and writing about money can make a person seem pretentious. I hope I don't come across that way. I see money as a tool to build the life, you want, not as a way to impress people, acquire fancy stuff or go to fancy places. Smart money. Decisions are a result of knowledge knowledge. Is gained through reading and thinking good decisions will lead you down the path, you want over time. But none of that is as important as your health, the health of your loved ones, and the relationships life events and adventures that bring you happiness. Sometimes that message is lost behind trying to count, an analyze every penny that goes in and out of our pockets, but health relationships and the activities that bring you mental wellness are the main drivers that should be leading the important decisions in our lives, not money stuff, you just listened to the post titled, it's only money by Craig Stevens of retire before dad dot com. And thank you so much to Craig for granting us permission to read his content and definitely come by his sight to show, your support again. That's retire before dad dot com. There's a lot of great info there, including reviews resources, a bunch, more articles and much more. And of course, be bringing you more posts from Craig in the near future. So. Oh, that's a wrap for today and for this week here at optimal finance daily have yourself a great weekend, and I'll see you back here on Monday where your optimal life awaits. Hello. Hi fop demise earlier, this is just in Mali creator, and producer of this podcast. But also optimal living daily the show where I read to you from even more blogs covering finance productivity minimalism, personal development and more from incredible bloggers like Derek Sievers zen habits marketing, angel the minimalists and all the ones you here on this show, too. So if you enjoyed today's episode an like taking amazing blogs on the go come on over to optimal living daily and subscribe to that, one too, and together, we'll start optimizing your life. You've been listening to optimal finance daily be sure to hit the subscribe button to stay up to date on each new episode and head till old podcast dot com. That's L D podcast dot com for a free gift as well as more actionable tips in resources to help you maximize your potential. Thanks for joining us. And remember your optimal life aways.

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