Ekabo Home Financial Freedom Mastermind Podcast
A podcast for those who do not believe they were put on this earth to work 40 to 50 hours per week for 40 to 50 years, to hopefully retire at the age of 65.
Ekabo Home Financial Freedom Mastermind Podcast
141. Is Your Financial Plan Holding You Back? Joel Miller's Insights Could Set You Free!
🌟 Redefining Financial Freedom: A New Approach to Financial Planning with Joel Miller! 🌟
Welcome to the Ekabo Home Financial Freedom Podcast! I’m your host, Niyi Adewole, and today we’re diving into the transformative world of financial planning with our special guest, Joel Miller, the founder of Flames Financial Planning. Joel is here to share his innovative flat fee membership model that is changing the way people approach their financial lives!
🔥 The Quote of the Day:
"Don't take someone else's plan. Forge your own destiny, create your own financial freedom, and I cannot wait to watch you grow in that journey."
This quote by Joel Miller emphasizes that financial planning is not just for the wealthy; it's essential for everyone. It encourages listeners to take charge of their financial education and seek guidance regardless of their current financial status.
🔍 We’re Unpacking 4 Game-Changing Questions from Our Community:
- What makes Joel's flat fee membership model different from traditional financial advising?
➣ Joel discusses how his model bundles investment strategy, tax filing, and estate planning into one accessible service. - How can financial literacy impact everyday Americans?
➣ Joel emphasizes the importance of educating clients to empower them in their financial decisions. - What role does real estate play in building wealth according to Joel?
➣ Discover how diversification and real estate investments can enhance financial stability. - How does Joel help clients set and achieve their financial goals?
➣ Learn about the goal-setting process that Joel uses to keep clients accountable and on track.
🎙️ Episode Highlights:
🏡 A New Era of Financial Planning:
Learn how Joel is trailblazing a new path in financial advising, focusing on transparency and client empowerment.
📈 Innovative Strategies:
Discover unique financial strategies that Joel employs, including the benefits of using Health Savings Accounts (HSAs) and the importance of budgeting.
🌆 Client-Centric Approach:
Get insights into how Joel builds trust and accountability with his clients, ensuring they stay engaged in their financial journeys.
💡 Legacy and Impact:
Explore Joel's vision for the future of financial planning and how he aims to change lives through education and support.
🔑 Key Takeaways:
➣ Understand the importance of financial literacy and how it can empower you to make informed decisions.
➣ Discover actionable strategies for budgeting and investing that can lead to financial freedom.
➣ Learn how Joel’s flat fee model provides a transparent and accessible approach to financial planning.
🌍 Why This Matters:
In an ever-evolving financial landscape, this episode serves as your essential guide to navigating personal finance. Whether you’re just starting your financial journey or looking to refine your strategies, Joel’s insights will help you unlock your potential for financial freedom and wealth building.
🗓️ Tune in every Wednesday at 7 PM Eastern! Don’t miss out on our journey toward financial freedom through smart investments.
👉 Hit that subscribe button and turn on notifications so you never miss an update! Let’s unlock your potential together!
Our Links
➣ Financial Freedom Mastermind Facebook Group - https://www.facebook.com/groups/53083...
➣ Peer Space Host Referral Link https://www.peerspace.com/referrals/g...
➣ AirBNB Host Referral Link https://www.airbnb.com/r/niyia41
➣ Ekabo Home Network (IG, Youtube, Email) https://linktr.ee/ekabohome
Niyi Adewole is a licensed realtor in Georgia, brokered by EXP Realty. Feel free to reach out at Niyi.Adewole@exprealty.com if you would like to work with an investor friendly real estate agent.
Welcome to the Financial Freedom Mastermind Group Podcast. Here we're all about breaking free from the 40 to 50 year work grind and accelerating our journey towards financial freedom. Join us every Wednesday at 7 pm Eastern as we explore different types of investments that can fast track your path to financial independence. We serve as a hub for connecting with fellow members during our sessions so you can share successes, ask questions and keep the momentum going.
Speaker 2:Good evening everyone. This is Nihi Adewale, host of the Acaba Home Financial Freedom Mastermind Group, and tonight we are joined by someone who's redefining financial planning and what it looks like in the modern era. We have Joel Miller, who is the founder of Flames Financial Planning, a flat fee, membership-based firm committed to bringing peace and freedom to your financial life, regardless of your net worth. Not only is Joel a certified financial planner, but he bundles everything from investment strategy to tax filing to estate planning into one accessible model. And he's also a three-time half Ironman athlete, which we'll get into a little bit because that takes definitely a lot of effort and energy put in. But, joel, we're happy to have you here, man, thanks for joining us.
Speaker 3:It is an absolute pleasure. Thank you for providing an amazing place. I'm looking forward to tonight. Come on now.
Speaker 2:And we were talking about a little bit off camera, but you are from the Twin Cities and we have all been watching your Minnesota Timberwolves. Are they going to be able to pull it out and make the comeback, or what?
Speaker 3:Is it Ant-Man or Camp-Man? I'm not really sure right now. He needs to be a leader and he needs to score a lot more points if we're going to pull it out. That Thunder Teep is deep and they are strong, so it's going to be a tough one, come on now.
Speaker 2:Well, we are rooting for him. Good series. But one of the things that you've built that really interested me and I was excited to get you on the podcast is when you talk to a lot of different financial planners, a lot of them have some incentive on the back end to put you into something like mutual funds and things of that nature. But you've built it in a way where you can actually help somebody by looking at all different types of investments and not just benefiting from one. And so what made you even come up with this idea of building this group?
Speaker 3:Yeah, it is time for this industry to change. It has been too long, it has been the same for so long and we need more people thinking the right way and doing the right thing. You should not be put in mutual funds that you don't need to be in with high expense ratios. Those days are gone. You don't need to go to investment products or real estate products because someone else is making a large commission off of that. So what I'm trying to do is trailblaze a new industry of flat fee financial planning where it is a one-stop shop. Traditionally, a lot of people would love to help you with the investments and the planning, but it is time for your investments, planning, tax filing and estate planning to all be covered under one subscription, because when you do those at different places, errors start creeping in, stakes start creeping in, there's a loss in communication. So it is so cool to provide a platform where someone can really try to offload a lot of small and major financial decisions and we get to walk through life together.
Speaker 2:Come on now and there's nothing like it, and the piece that I always go back to is my personal story. And so for the longest time when I was working in college, right up until my first full year of corporate work post-college, I was the one filing my own taxes. There was just something in my head saying you know what, that's for wealthy people, that's for those that have already kind of gotten established, and I shouldn't be looking at that, and I feel like a lot of people have the same misconception when it comes to wealth planning and just that whole financial picture. What would you say to those folks and how are you changing?
Speaker 3:that that is music to my ears. Come on, because everyone files a tax return, whether you have to be an expert in your area, we're then expected to have this expert of speaking a different language of your finances and if you're a little bit behind or if you didn't come from the same background as someone else. What boggles my mind and makes me so fired up about this is the wealthy get to stay wealthy because someone taught them how to do it, so it just stays at that upper class and never trickles down, because the blue collar, the average American, the people that work so hard, don't get to learn this. So everyone files a tax return. I'm on a mission to say, hey, you deserve, you don't have to file your own tax return. Someone should be able to do that for you and that should be covered.
Speaker 3:So I just love that you mentioned that, because it almost feels like imposter syndrome. Right, it feels like, wait a minute, I'm working with a tax professional, like someone else is doing my tax return. I don't have to do that. That is something that just brings joy to my heart is when you get treated like wealthy because you are like. Everyone is wealthy here in the US compared to other countries, other nations. So we are wealthy and it's time to do something with that.
Speaker 2:Yeah, and I love what you just said because you're spot on. When you look at the worldwide, US is easily, easily in the top 10, probably top like 5% or 1% of the wealthiest in the world. When you look at what we have here and I think that kind of just gets lost in the shuffle in the day-to-day when you're trying to grind and get more and more. But one of the things that kind of pops to mind as well, based on what you're saying, is and this is what you said even earlier being able to have a one-stop shop for all these pieces, right? So you offer everything from the tax filing to the estate planning in one model subscription. How does this help clients actually follow through on their planning and see the success on the backend?
Speaker 3:Man. I just love that question because for so long and so many advisors have to say, hey, I'm so glad that we work together, but we don't do tax planning or we don't do tax filing. Sorry, you want an estate plan. That's going to be an upcharge from the price that you're already paying, and some people are paying a lot of money to work with a financial planner and they're not even getting some of these basic needs covered right. So it feels good to actually encourage change and help them stay accountable for that, because one of the best things about this industry it's a trust relationship business. That's truly what's at the root cause of walking through life with someone, whether it's goals or accounts or saving taxes.
Speaker 3:Estate planning If I tell someone to go get their estate plan done, I give it a 20% chance that it ever goes really gets done. Maybe Right, but if I, if that's covered and I can help them with that, if I can hold their hand through that process, the chances go up up, up of that actually getting done on time within a timely manner. Come on now.
Speaker 2:And, to that point, what does it look like when you have an initial conversation with a potential client? Cause I can think of a couple in my world where I'm like, hey, I should connect those guys with Joel to have this conversation. So what does that look?
Speaker 3:like on the initial consult that you do with people, we dig into goals. This is so much about goal setting. What do you want to do? What are your financial goals that you want to achieve? And then maybe what's one that you didn't think would be possible? Right, and I'm going to hold you to that, because I think we only grow if we set the bar very far in advance. Trust me, we'll talk about this later.
Speaker 3:I never, ever, imagined doing a half Ironman, but someone helped hold me accountable to that goal and I never thought I'd be able to do it, and now I love it. It's the same thing with our finances. You didn't think you could retire at 59 and a half. Maybe you can. The earlier you start talking about that and the more that you have someone hold you accountable for that, the chances of that coming true skyrocket. So I wanna get to know you. I wanna make sure it's a good fit. Are you like a good fit for the member? Is the membership gonna benefit you? I don't wanna hurt you financially, I wanna help you. I wanna walk with you, right? So that's what it really comes down to. Is what are you looking forward to? What do you want to do in the next one month, three months, six months, five years and 30 years down the line.
Speaker 2:So we talk about it's deep and it's wide and I love it Come on now and a lot of our audience are first time or small time real estate investors that are growing their portfolio to get that financial freedom. How does real estate play into the overall method of building their wealth and what's your experience with that real estate side?
Speaker 3:Diversification, right. We don't want to put all of our eggs in one basket. So, whatever it is, don't over-leverage yourself and make sure you know what your highs and your lows are, because there's lots of ways to build wealth. We're in America how cool is that? That you could choose option A, b, c or D. So what we want to find is how do you want to build your wealth, how do you want to pave your path, and what does that look like? So that way, we can do some projections, and one of the key things is not just writing down your goals, setting them, locking them away and coming back in 10 years.
Speaker 3:It's about the journey. It's about making adjustments and changes along the way. I think of it like as an endurance athlete. I think of it like when I'm going through a race every mile there's an aid station. So that way, what do you need? You need some food, you need some water, you need some fuel, you want to like, re, like, re, grab yourself and get the energy back. And that's how I feel about financial planning and the journey. Right, it's like all right, what works best for you? We're going to look at different methods, we're going to evaluate and analyze all of that together and, I think, real estate man, especially in the last 10 to 15 years, what a powerful wealth building tool.
Speaker 2:Yes, yes, and I love what you talked about a little bit earlier in that analogy you made about when you're running these half Ironmans, right, and they have these aid stations and a lot of that kind of goes hand in hand, right, because they say how you do one thing is how you do everything, and so the fact that you've been able to train and crush these Ironmans it leads me to believe that, on the financial side, you've developed that type of discipline as well. So how has that discipline carried over on the financial side for you personally? And now to your clients?
Speaker 3:Yeah, the race day is a culmination of all the training. It's just one day. It might take you six hours, depending on the race you're doing. It might take you longer or shorter. Maybe it's a marathon, maybe it's a triathlon.
Speaker 3:That is a culmination of all of the hard work you put in beforehand. So if you don't put in that work, if you don't put in that time and that grind and that those little days that add up over time, it's going to set you up for either success or failure come race day. And that's like. That is just how it also comes to our personal finances and our goals, our career goals, our savings goals, right when we get up to retirement. It is going to be a culmination of all of the things that we did for the last X amount of years.
Speaker 3:Were you willing to put in the grind? Were you willing to allow compounding interest to do its hard work? Were you willing to delay gratification to buy that next home or to max out your 401k? Whatever it is, it is about time in the market, not timing the market, and one of my favorite sayings is a little number multiplied by a little number over a long period of time turns out to be a pretty big number. So it is a marathon. It's not a sprint, so we can't expect it to be a sprint.
Speaker 2:A hundred percent agreed, and those that try to get into whether it's real estate investing or the wealth building journey in general and do it quickly, tend to lose the money that they put in initially. Right. You have to have a long-term mindset and understand that this is not hey, let me run as fast as I can in the first mile. No, you need to be consistent over the whole time and that's how you finish the race, whether it comes to those Ironmans which I have not run, so I don't want anybody to-.
Speaker 3:Not yet, not yet. Yeah, not yet, not yet.
Speaker 2:But when it comes to that wealth building journey, absolutely. And so what is some practical advice, or even things that you've seen first generation wealth builders or W-2 income earners make mistakes on when it comes to, or maybe even overlook in their financial outlook and financial picture. What are some things they overlook?
Speaker 3:Yeah, I would say budgeting right. I know it's such a gross word. A lot of people feel different ways about it, but if you have no idea what you're making or what you're spending, you're set up for failure. You've got to at least. I have a running budget for myself, even as a CEO, as a financial advisor, and I make updates to it when there's like a major bill change or when there's an income change. So I have a general idea of what's coming in and what's going out, and that makes sure I don't over leverage myself. We're not like overspending, that we're hitting our savings and our long-term goals. I think it starts there, even though some people love pinching every single penny and some people never want to look at it. No matter where you are on that spectrum, you have to have a general idea, because then what I call it is like your magic number. That's what's left over after. Here I call it is like your magic number. That's what's left over after. Here's what you make, here's what you spend. There's your magic number. That's what you can go do something incredible with. That's where the money's made right. Are you going to use that money to buy the next home? Are you going to use that money to increase your 401k.
Speaker 3:I talked to so many people and they have no clue what they spend. They have no clue what's left over. So how are we going to make a plan if you don't know what's left over in order to do something? So that's one of the very first homework items I challenge everyone with. Maybe it's your first budget, maybe it's your one-year budget, but you got to know what's left over that you can allocate to build wealth. You need to make money and you have to have money to make money, right? So just know, just have a general idea of what you could do and how much you have, and then you can start crunching the numbers. Then it comes down to well, either make more to raise your ceiling or spend less so that you can grow that magic number. But that's where the magic really happens.
Speaker 2:Absolutely, a hundred percent. Agree. You have to know your numbers. And I'd take it even a step further, and I know that you do this with clients as well. I read a book a while ago called Profit First. Have you read this book? I've not read that one. It'll go on my reading list, come on now. It's an amazing book and it talks a little bit about that, and so I've implemented it in my life, and it started with the budget, as you talked about.
Speaker 2:But, but profit first follows what our parents used to do back in the day, which is the envelope method of like hey this money's for groceries, this money's for fun, this money's for healthcare, right, and it puts it in the digital realm, and so I personally have about six bank accounts that's allocated for all these different things. When money hits the one account every single night, it splits automatically by percentage to these other areas, so I don't overspend in one area and I know what I have. For fun, I can look at the account. If you're like, hey, let's take a trip to Vegas, I'm like, all right, let me see the account. Do I got it? If I do, okay, if I don't listen, man, it's going to be maybe next month.
Speaker 3:That's exactly how it should be done. It's it's got your system down. It doesn't take nearly as long now as it used to and a lot of it can be automated. So sinking funds are a great way to do that. If you have a car that's coming up, start a sinking fund and put away money every single week for it or every time you get paid. There are bills that I know about. One of my favorite things I don't know how you feel about this, but one of my favorite things is to waive escrow on my home. So that means I handle the property taxes and the insurance on my responsibility, instead of sending extra money to an escrow account for them to handle those. So I know every six months my property bill, my property tax bill, is due. I use a sinking fund to save up for that. For my life insurance, I use a sinking fund to stay up for that. My vacation. That's such a healthy way to do it and you will see enormous success by doing it that way Absolutely.
Speaker 2:And we've done that on, like more commercial properties, on the smaller properties. I get nervous about it and this is just me personally Like it makes perfect sense. You should have that money in your hand and not be giving it to the bank to go hang on to, because you may have an opportunity or be able to get interest on it, but you get so many over time that I don't want to forget to pay it.
Speaker 3:Oh, absolutely. Yeah, you should see my calendar of, like, the different bills I need to pay, if you have the capacity. It's a great small little way because those small ways add up, but that's like nobody knows about it. That's probably between that and a recast. Those are probably two of my favorite things to bring up with new homeowners or people that are thinking about buying homes, and you love seeing that light bulb moment go on, because everyone's like what is waving escrow? My lender didn't tell me about this, of course they didn't, and like oh, I can do a recast. Nobody's ever I've heard of a refinance but nobody's told me about a recast before. So those are some of my favorite home conversations. Come on now.
Speaker 2:Do you mind diving into the recast piece, because most of the audience, including the guy you're talking to, do not know the definition of a recast.
Speaker 3:What is that? Absolutely so. Everyone, or most people, have heard of a refinance. That is an opportunity. If your interest rate goes down and you want to refinance, I'm typically looking if you can get a 1% drop or more. Let's run the numbers, let's see what your closing costs are, what your new monthly payment would be, and a refinance is where you redo basically every single term on your mortgage.
Speaker 3:A recast is a really powerful tool that might have a small fee included I'll just say $200 to $500, small pennies in the grand scheme, but what that allows you to do. Maybe you needed to buy a home a little bit sooner than you could really afford it, but you know it's going to be okay. Maybe you like have a bonus system, your commission structured. Or, for my example, in my life, we are moving from North Carolina back to Minnesota and we had to buy this home before we could sell our Charlotte home. So we knew we had that equity. We knew we were going to get the money, but we couldn't use that money to put as a down payment on our Minnesota home.
Speaker 3:So a recast is when you have an opportunity. Let's say you have a lump of cash, from an inheritance, from a stock sale, anything. You have a lump of cash sitting and you want to lower your mortgage payment because maybe it's just a little bit bigger, maybe peace of mind, whatever it is, you want to lower mortgage payment, but you can't redo all the terms. Maybe interest rates have gone up, maybe they're the exact same. What it is is wiring money to your lender, doing a recast procedure, and then they recalculate the new amount that you owe based on the new remaining balance. So I'll just use random numbers. We bought our.
Speaker 3:Minnesota home. Let's say our payment was 4,000 a month. We sold our Charlotte home. We got the equity. We wire that to our lender. They recalculate the new monthly payment to drop it from the original four grand down to three grand because we owe less on the mortgage. So that's a recast and that's an amazing opportunity.
Speaker 2:If you're looking for flexibility, that can be a great tool Absolutely, and I love it because you still have the equity in the house, it's de-risking it on a month-to-month basis and especially if you're looking at even like investment properties. The way to make it work or make some of them work in a higher interest environment is to have less of a loan payment, right, because if you put down less or leverage less, then you have less that's getting hit with that high interest rate. So that makes a lot of sense.
Speaker 3:Yeah, so just a really cool tool, one that I personally used, and it's just one of those things that nobody talks about, but it might be perfect for your situation.
Speaker 2:How do you personally define financial freedom? What would you say if somebody asked you hey, what is financial freedom? How would you describe that?
Speaker 3:I would say financial freedom is when you have enough cashflow or enough in the accounts to do whatever you want. Maybe that is quitting your job and going, getting a paid decrease. Maybe that means dropping down to 30 or 20 hours a week, or maybe that means working 40 hours instead of 60 hours. Right, financial freedom is different for everyone. Everyone's journey is different. Everyone is unique and that's why you need a plan that's tailored for you. You can't just I can't take your financial plan. It would be so maybe wrong for me and my family.
Speaker 3:I have two boys, three and one, so I know I'm in a grinding season. I need to provide as the man and father in the household and the husband I need to provide for my family, and what that means is making money right now, decreasing my financial risk by having 2.5 million in term insurance on me. That way, if I'm not here anymore, my family's taken care of. That means having a good estate plan that is ready, set, signed and like can be executed if I am not here anymore. So that's right now. Financial freedom to me means peace of mind, to make sure my family knows that I'm taken care of. Financial freedom for you might be like, hey, I want to work for 10 more years and then I want to do whatever I want. If I want to work, I can. If I don't want to work, I don't have to. So financial freedom we throw that term around a lot, but it's really different for every single person.
Speaker 2:Absolutely. But I love the way you just defined it and you're spot on right. Each person has to find their own why. It's why you're getting up every day and getting after it, whether it be from the physical standpoint, to the financial standpoint, to the helping client standpoint. And so, yeah, I love that piece. And when you talk about the family right, you mentioned you have a three and a one-year-old. I'm actually expecting our first child, so I'm going to be joining the dad ring soon.
Speaker 3:Let's go. It's the best thing that ever happened.
Speaker 2:Come on now. I'm pumped Due in July and so getting ready for all that. But when you look ahead to the future, at some point we're all going to pass away. That's the one thing that is true Death and taxes, death and taxes. And so what are some things that you would want your family to say about you at the funeral when you pass way, way, way in the future? What would you want them to say about you, about the legacy that you've built?
Speaker 3:Yeah, absolutely Well. Number one first of all, I'd want them to say that Joel was a man of God right, that Joel embodied Christ and he wanted to be like Christ. He wanted to speak like Christ and act like Christ. That's number one, most important thing in my life. Number two I hope that there's a bunch of people there friends, family, everyone and that they could just have a great time that we can. This is a celebration, going from a short-term life here to an eternal life. That is a celebration and a party that we get to have. I know it's hard in the moment, but I want everyone to be just having probably a buffet of sushi and maybe some like really fun music or something to celebrate. Some sports going on almost like a grad party and less like a funeral. But I would hope that they say that he was an extremely hard worker, he changed the lives of, I hope, thousands of Americans and that he left a lasting impact and legacy on the financial planning industry, because that's what's so cool about this is at the heart, at the root.
Speaker 3:I'm a teacher, I am teaching people about their own personal finances and, thank goodness, I get to work with adults instead of like teenagers or middle schoolers. I love them and I can't wait for my boys to be there. But I love that I get to work with adults all the time. So that would be my goal, because if I teach an adult, most likely they can teach their kid, or they can teach their brother, they can teach and take care of their parent. So I love it's almost like you teach someone to fish and they can go teach others to fish. I'm not just going to give you the food, but I'm going to be right there with you. So that is the legacy that I want to leave on this earth is that I want to make an impact and change lives.
Speaker 2:Come on now and you already are one with this model that you've put together because this is unique and it's one that I've never heard of before to do it in this manner, to where now anybody can be more accessible to this, because when I think about wealth managers and building that whole piece, it's always like some stuffy old room that I think about, and so this is definitely an interesting and unique model, and we appreciate you for what you're doing, pioneering this in the industry as well.
Speaker 3:Yeah, absolutely it's. Why should we be paying 1%? There are some things that just exist because they have always existed right, but it's time for that to change. You should not have to pay a traditional 90% of advisors charge, an AUM basis. I can't wait to watch that number change right in front of our eyes so more people get access to a flat fee environment. Can you imagine, can you imagine going to the gym and every time that you lift more weight cause you got stronger, that your gym membership goes up in price? Could you literally imagine? If that's, if that's how it worked, it's like, hey, sorry, you came six days this week so we're going to increase your price. Or hey, you've been working really hard, I've been seeing that those bench press numbers go up, your fee is going to go up. That is exactly how 90% of this industry works. If you work hard, if you save hard, if you do a rollover, if the stock market goes up, so does your AUM percentage fee for an investment manager.
Speaker 2:I 100% agree, and being able to actually not have somebody that's tied to even going after riskier investments and things of that nature makes a lot of sense, right? Because if it goes in the negative, you're the one that's feeling all the pain, not the advisor, and so it's good to have somebody that's on your side, that you can pay for the knowledge that they've gained over the years, that can guide you throughout the whole process, which is awesome.
Speaker 3:Yeah, and most people have been denied access for so long. Most people hey, if you love real estate and if you have a lot of your net worth and your assets tied in real estate, a lot of people are like, hey, good luck, maybe talk to me if you sell all those properties, right, because they're going to require that 500,000 to physically manage or that 1 million or that 2 million to physically manage for you. That's hard if you're in the real estate business because you have a lot of your assets and equity tied up. Or that's hard as a 25-year-old, that's hard as a 30 or 35 or 40-year-old. That's why most people don't have a financial advisor until they're 45 or plus, because that's when they finally had enough extra money outside of their 401k or outside of their home that they could hand that over to them.
Speaker 3:So some of my favorite conversations I have people who are in their low 20s, mid 20s. I also have clients in their 80s, and that's what's so fun. I'm not talking about social security every day or RMDs every single day. Most of my conversations are hey, you're having your first kid. Are you looking forward to open a 529, a UTMA? You're going to be spending a lot more on diapers than you can probably assume. So that's what I love to talk about, because that's also the same life stage that I'm in, so I get to walk through some of the biggest and best moments of someone's life.
Speaker 2:Come on now and to that point this is kind of a selfish question, right and then to more of like your contact and things of that nature. But we are going to have our first kid and I was scrolling your IG a little bit earlier and so one of the videos that caught my attention is you did a video on the HSA and you're talking about like, hey, go ahead and spend that money because if you're maxing it out every year, you're probably not going to spend more than your qualified health, especially if you work out and you're generally healthy. And so are diapers a part, or approved as part, of the HSA spending or not so much.
Speaker 3:Not that one, not yet. They're always updating the list, which is great. It is getting bigger. It is growing. Hey, I've got I got my watch on my HSA. I got my Norma Tech sleeves on my HSA, so there are some good things that you can purchase, but I hope it continues to grow. I love that. The government loves the HSA, so it's getting bigger and more flexible all the time.
Speaker 3:I could see a world where we're not too far off from gym memberships being HSA eligible and I love that you brought up that video, because that's a hot take. Every other advisor, every other financial planner, when you watch their video on the HSA, they're going to say don't you dare spend it. I want you to save your receipts for the next 30 years and reimburse yourself when that account has $300,000 in it. Well, guess what? When that account has $300,000 in it, I hope your 401k has $2 million in it and I hope your Roth IRA has $1 million in it, right? So we need this.
Speaker 3:In my opinion, we probably most likely need this cash flow more today than we need it in the next 30 years, because in 30 years I'll have a bunch of other accounts that I can use. So what I love to do and this is a unique strategy. Everyone has a different take on it but I love to spend my HSA. I've gotten LASIK, we've birthed two kids, we've gotten stitches for my three-year-old. We've done everything, every prescription, everything that is HSA eligible, I love. I'm going to lock in the double tax advantage right now and I still have over $35,000 in my HSA because I max it out every year and our health expenses like you're never going to have most likely that many health expenses.
Speaker 2:So I think you can get the best of both worlds where I lock in the tax deduction, help with my cashflow today and then also invest what's left over 100% agree, and it's one where, as soon as my company when I used to work for a company before going full-time entrepreneur offered the HSA, I moved over to it, I rolled it over to my personal and I still invest in it actively and it grows pretty quickly and, for most people who are going to be active and healthy, you're not going to use a heck of a lot of it throughout the year, and so you should be using it for those qualified expenses. That makes a lot of sense, joel.
Speaker 3:Yeah, and you can still invest it. Like I said, I have over 5,000 in the cash portion if there's immediate health needs that we need it for, and then I have over 30,000 in the investment portion itself. Whether you're single, and it's about 4,000, or joint, and it's about 8,000, even through two kids and LASIK and everything else, I still have that excess in there. So you can get the mix. I'm just not afraid I don't want to keep receipts for 30 years. And guess what? What if the government changes the rules? What if they say you can no longer backdate pre like health expenses that you used? Oh yeah, you have that receipt from 20 years ago. We're not going to, we're not going to like deem that as valid anymore. So I just don't need to rely on those, like the current laws existing for the next 30 years. So I think you can get best of both worlds. But I am not afraid to use my HSA for qualified medical expenses today.
Speaker 2:Come on now. And, joel, if anybody that's listening or listens in the future wants to get ahold of you and potentially join the group and learn more from you, how can we reach you?
Speaker 3:Yeah, absolutely, and I think there's a question that just came in about thoughts on paying your children. This is an amazing strategy if you can legally do it right. It is hard and there are rules that set up, but that shouldn't mean that you shouldn't not do it. If you're eligible and you have a business where you can give them roles and responsibilities and pay them the correct number, you're going to get in trouble. You're only going to get in trouble if you get audited and if you are breaking the rules. So I would say work with a really good CPA or a good financial planner that can help make sure that it's set up correctly, accurately, and the rules do change. So don't just take the advice one time and do that same thing for the next five years. Stay accountable, walk through someone and help set that up, because that can be a very powerful tool to help decrease the tax bill and pay your kids for job responsibilities that they are age appropriate for.
Speaker 2:Come on now and to that point, and then I want to circle back on your contact and then we'll go back to more questions from the audience as well. When you look at kids, right, one of the things that I've heard and we need to look more into this because we're getting close to our firstborn coming is doing Roth IRAs and things of that nature from birth and having that grow over time. Is that something that you've looked into? What do you recommend with that for kids?
Speaker 3:Yeah, 100%. I would say the two best accounts today that are eligible for pretty much any kid is a 529, depending on if your state allows to do a tax deduction on the way in. It's usually not very much but hey, I'll take any way to decrease my tax bill. So here in Minnesota we're able to get a slight tax deduction, depending on where you are in the US. It's a little confusing. Almost every state has a state specific 529 that you can use but you don't have to use. So there's a tool out there that will tell you hey, if you use the Virginia 529, you'll get a state tax deduction, but in Florida you won't, obviously because they don't have state income tax. So that's a really good one and I like to do that. And a UTMA. A UTMA is just like an investment account with your name and the minor's name attached to it, so you can start putting in a little money over a long period of time. You could use that for clothes, for a car, for college, for a wedding. You can use it for anything. So those are two really good ones.
Speaker 3:The minor Roth awesome, incredible. Take advantage of it if you are paying your children or if they have earned income. So if they go get that job that is earned income that they paid taxes on, encourage them say, hey, you're working really hard, you're working in a sandwich shop. So if they go get that job that is earned income that they paid taxes on, encourage them Say, hey, you're working really hard, you're working in a sandwich shop. If you put in $100, I'll give you $100 to put into it right. Help boost some of that so that way you teach them and they can start doing that at an early age. Most people don't get their Roth started until way too late, so that's a great way to help them out earlier on.
Speaker 2:Come on now, and with the minor Roth is there a minimum age limit or can you start that right from birth? You?
Speaker 3:can start that, as at any age, if they are making money. So that's the hard thing. You can't I probably can't have my one-year-old doing phone calls for me and paying him for that. But if there is income that is earned, maybe they're doing yard work and like paying taxes on it. So the rules get a little sticky and I always want to be extra careful when it comes to that. But if they do have earned income, then you might be able to make those contributions. So it's great. The rules could also change. So just a caveat like everything else we're talking about, stay up to date on the rules the government loves right now. They love Roth IRAs, they love 529s. Those are some really popular accounts that they keep making even more flexible, which is really cool. So we love accounts that the government also love Absolutely.
Speaker 2:Work with the government and you are on the right side to make and keep some more of your money.
Speaker 3:Those are people you want on your side of the fence. You do not want to make them angry, or else you will be the one paying, unfortunately.
Speaker 2:This is true, and so, with that in mind, what is the contact information and how can people reach you if they want to find out more and work with you?
Speaker 3:Yeah, absolutely. I would love to meet everyone, regardless of where you are in life right now, whether you're old or young. You, everyone, regardless of where you are in life right now, whether you're old or young, you make a lot, you make a little, you have assets or you don't I would love to say hello so you can. Either you can reach me in a few ways If you're interested in a membership and if you think this sounds like something that you've been looking for or maybe this is the first time you've heard of it and you love the idea you can go to flamesfpcom, hit, get started and jump on my calendar Complimentary free introduction call.
Speaker 3:I'm not trying to sell you. I just want to meet you, right, so we can talk about where you are in that financial journey and make sure that this would benefit and help you If you love what you heard today and you just want to join in on the fun. You threw this out earlier, but I post daily financial content on my Instagram and YouTube so you can follow me, joel Miller, cfp, on either one of those platforms and you'll just get to grow, you'll get to learn, you get to send those to other people and you'll probably hear things you've heard before and you'll probably hear things you've never heard before. So it's a lot of fun producing that and having that opportunity to change lives.
Speaker 2:Come on, joel, you're changing lives and changing an industry that needs it, and so, no, we're excited to have had you on here and to be a part of the journey. I know a couple people I'm gonna be sending your contact information to, and I'm sure that some of the listeners are gonna wanna jump on your calendar as well, but we'll pause for a second. Any questions from anybody that is on live, please feel free to throw it in the chat and or join live to ask. So I'm going to read this one to you. So I ran a few scenarios of buying a rental property for my child and investing in a small or investing a small amount into a 529 plan. The growth could be used to fund college and doesn't lock them into a college. So I think the question is, when you look at those two scenarios, is this something you've talked to clients about? Hey, buying an investment property for your child versus a 529?
Speaker 3:Yeah, absolutely. Like I mentioned earlier, there's so many ways to do this. So if I was looking at this question, I was talking to a client. I would say does one of them jump out to you? I think either of them could be successful. The investment property either is going to come with, maybe some time, some more responsibilities. Do you have the time and capacity to take that on right now, or are you going to pass it off to a property manager and accept a little bit less of the profits? That's option A.
Speaker 3:Option B is we invest into a 529 and it's extremely passive. Set it up, we get it invested in the right spot. So I think a time component is a big factor here that I would talk to them about, because I think both could work. Both could be wildly successful, but one is going to take a whole lot more time than the other one, or we could use both. We could. There's like most of the 529s have extremely low, like starting contributions. It doesn't take that much to get started and open the account. So maybe you want to try both of them and then if one is doing better than the other, or if you're not enjoying the rental property anymore, then we can always pivot later on, but I don't think you have to go all in on either one of those if you're really passionate about both of them and again.
Speaker 2:another selfish question when you look at a 529 plan, right, that's only able to be used for college, or are there other things?
Speaker 3:Speaking of the government making rules and changes, it was only for college not that long ago. Now it is K through 12 and college for those educational purposes and qualified purchases that you're going to have. So that's what's so cool about the government liking that account is it gets more popular. They are encouraging it, they want people to use it and then, yeah, and private school. So that's what's so great about it is okay. Well, college is changing a lot. I don't know what college is going to look like when our kids are there. I hope it's not the same cost as when we went to school, right? So maybe I will use my 529 for my kids K through 12, get them to private school or put them into some other sort of school. So that's what's so great about it is it used to only be for college, but not anymore.
Speaker 2:That's pretty incredible. I'm learning literally right now. One other question on that piece so, with the 529, right, I just heard from uh, uh, I go to this gym and it's a really nice gym. There's some some pretty affluent people there and things of that nature, and so I was talking to one of the other gym mates and they mentioned that, um, they hired uh, a Spanish speaking nanny that helped out for the first few years, um, with the child to help uh make them more bilingual, right, and it worked wonders. And then they put them in a private school that was like a trilingual private school, all that stuff. And so you mentioned it could be used for K through 12, other expenses. Can it be used for nanny costs or is that going too far right now?
Speaker 3:Probably. I mean, maybe if you had someone like a private educator and a tutor that was coming to your house for that specific purpose. I'm not actually sure, though. Anytime if there's something I don't know about it, I always go to the tax code itself and dig into it, so that way I can learn and make sure. Like all right, is this clear or is it a gray area? So I don't know the answer to that question, but my best guess would be, possibly if it was like a homeschool specific tutor, but if it was like a nanny, then I would probably say that's not a qualified educational expense.
Speaker 2:That is fair. So I need to find a nanny that's trilingual and a homeschool teacher.
Speaker 3:And we'll also teach them along the way. So. But there's so many other things now they're going to allow, like, if you have a 529 that's been open for a long enough time, you can actually roll some of that over into a Roth contribution. It's unreal. It's called the 15 year rule, that it just has to be open for at least 15 years. So what that is is sometimes people have overfunded the 529. Maybe they didn't end up going to a four year school, so there's so many left over. So this is very new. As of the last two years, this new 15 rule came out. If it's opened up for 15 years, there's still money left over you can actually roll a portion of in. That it counts towards your Roth IRA max limit for that year. So you can't put 7,000 from your bank account and 7,000 from your 529, but you could roll over some from the 529 to your Roth and your Roth contribution is maxed for that year. How cool is that? That's a brand new rule that just came out in the last two years.
Speaker 2:Yeah, no, it's definitely an ever-changing environment. I'm excited to start digging deeper into this piece, especially with the family growth. I know a lot of our listeners will be as well. Joel, we appreciate you joining the Acaba Home Financial Freedom Mastermind Podcast and, for those who want to get in contact with you, we will put Joel's contact into the show notes. Please go ahead and like, subscribe and leave comments on this to let us know what you think about the episode. But, Joel, what do you want to take us out with man? What's the last takeaways here?
Speaker 3:I am proud of every single one of you. If you are listening today, that means you want to grow, that I am proud of every single one of you. If you are listening today, that means you want to grow, that means you want to better yourself and learn. Never stop learning. So I want you guys to take something whatever you learned about here today, go tell someone, go educate someone else. And if you want to learn more, if you want to soak in more, we provided a lot of resources to do that today. So I just wanted to let you know. If you haven't heard this before or if you haven't heard in a long time, I'm proud of you. I can't wait to see and I want you to forge your own financial future. Don't take someone else's plan. Forge your own destiny, create your own financial freedom, and I cannot wait to watch you grow in that journey. Come on now, joel. We appreciate you.
Speaker 1:Absolutely. Join us every Wednesday at 7 pm Eastern, as we explore different types of investments that can fast track your path.
