The X’s & O’s

Building personal wealth can take a long time to do and making smart, financial choices can be difficult to carry out. On top of that, there are many products in the financial industry that can do more harm than good and can affect your personal wealth long term. Brent, Matthew, and Joshua discuss some potential wealth destroyers they have seen in their practice and offer a few strategies that might help you get out of these situations.

The Hosts:

Brent Pasqua, Matthew Theal and Joshua Winterswyk


Brent Pasqua: All right. We are back welcome to the Retirement Plan Playbook. I think we have a really fantastic show today. Today we’re going to talk about the personal wealth destroyers, things that really can kill your financial plan. And I’m excited for the topic because it’s something that we’ve experienced seeing so many times with so many different clients. So we’ll get into those today. I’m your host, Brent Pasqua, founder of RPA wealth management. I’m here with Matthew Theal, certified financial planner, and Joshua Winterswyk, certified financial planner. To kind of kick this off, I’m kind of curious, one of your guys’ most be beloved events is starting to have fans back. LAFC is, I think, kicking off their fan season this weekend. You guys going to be at the bank?

Matthew Theal: Yeah, I think so. It’s looking that way, Brent. I’m really excited. So I think I mentioned on the last pod, I went to a baseball game. Baseball is really boring. So like by the third inning, all I could think about was going back to the Bank of California. So yeah, it’s going to be a fun event for sure.

Joshua Winterswyk: I’m really excited. It’s just been too long. It’s something that we’ve really fell on love with, LAFC soccer, in downtown LA. And so getting the notification that as season ticket holders we were selected to be part of the allocated fans that are going to be allowed at the stadium on Saturday is going to be really fun. They sent us a complete checklist of all of the restrictions so they’re well prepared for this event and I’m just really excited.

Brent Pasqua: Do we have any of the family pictures that we’ve all had there with our families and wives at the bank on any of our social media?

Matthew Theal: I don’t think so.

Brent Pasqua: Maybe we can throw some up in as this topic goes so you guys can kind of see our history of us at the bank?

Joshua Winterswyk: Yeah. That’s a good idea.

Matthew Theal: Now, before you pivot here’s one thing I was thinking of with Josh, I think at least one of us, because there’s another season ticket holder has been at the bank for every game. Right? Like there might have been maybe one date we miss for a bachelor party or something. But other than that, I think we’ve been to every single home game, at least one of us.

Joshua Winterswyk: Yeah, I think so. That’s probably pretty fair. I think besides the bachelor party we were all at, which I think was mine.

Matthew Theal: Yeah. I think we gave up seats that day. But other than that, we’ve been to every, every game since the team started four years ago now.

Joshua Winterswyk: Yeah. And I think it’s cool that we’re going to this reopen. I’m just excited to be a part of it because not everyone got selected. So I feel a little special that we’re going to be able to go.

Brent Pasqua: Yeah. For anybody who lives in Southern California, I think it’s a premiere event to go to. I mean the soccer games are awesome to watch and the facility of the stadium is beautiful and it’s brand new so…

Matthew Theal: Well here’s something crazy, Lakers are coming back too around the same time as LAFC for in person. I was looking at secondary market ticket prices. You go to a Laker game at Staples for cheaper than you can go to a the LAFC right now. LAFC is about 50 to $60 more per seat than Lakers.

Joshua Winterswyk: Yeah. When you told me that, I was like amazed to see that especially after the pause and championship season, but you can just see how popular LAFC has become and how popular soccer has become in Southern California.

Brent Pasqua: Yeah. It should be a great weekend. All right, let’s get in the hot tick headlines. The largest crypto custodian, Coinbase, came public and we’ve talked about Coinbase in the past For those that aren’t familiar, Coinbase allows people to trade digital currencies, such as Bitcoin and Ethereum. The offering priced at $250 a share. That’s when it came out. And it opened for trading though at $380 trading up to $429 and then crashed back down to $310. Matt, let’s start with you. I mean, what’s your take sort of on this Coinbase going public.

Matthew Theal: Big moment for crypto. Right? Big moment for the Bitcoin, the Ethereum crew, the people with the laser eyes on their social media profiles. In a way it’s kind of funny though, because the whole thing with the crypto crew is decentralization, but here’s Coinbase going public. And it’s actually a centralized US exchange that cooperates with the government. If you’re trading there, you’re going to get your 1099s and pay taxes on your Bitcoin profits and your Ethereum profits. So kind of funny from that regard, but the company looks incredible, highly profitable. One of the better companies to come public in the last five years. I did buy shares as I believe that two of you did, so we should disclose that. So we own Coinbase.

Joshua Winterswyk: We already lost money on them.

Matthew Theal: Yeah, we did. We did lose some money from the opening, but, hey, you know what? Really cool. I’m excited to see the company grow over the next five to 10 years.

Brent Pasqua: Yeah. I think it’s also just really cool that we get to see the evolution of cryptocurrency being a part of this from such an early stage. And I think that it is a way for, again, young investors to learn about another asset, and have a platform to do it. Yes, it is centralizing it, like you said, Matt, a little bit, but I think it gives some more security, especially to some more weary investors. There’s going to be more regulations around Coinbase, but I also think that it’s going to start a lot of competition. Right? They’re not going to be the only big player on the block anymore. You could see how profitable this company was and their platform. So it’s going to promote a lot of competition in this space.

Matthew Theal: They need to purchase BlockFi. BlockFi is coming up really hot on them. You know, the one where that gives you the interest and they’ll give you lending against your Bitcoin and everything.

Joshua Winterswyk: And they have the credit card.

Matthew Theal: And the credit card. Coinbase needs to purchase BlockFi.

Joshua Winterswyk: Yeah. I would agree.

Matthew Theal: If they were smart, they would do that.

Brent Pasqua: And to put in perspective, what Coinbase is, is Coinbase is like the Charles Schwab or Fidelity or Robinhood of cryptocurrency. It’s a platform you purchase these cryptocurrencies on.

Matthew Theal: Exactly. That’s a great analogy. It’s the Charles Schwab of cryptocurrency.

Brent Pasqua: Yeah. And that’s why you say when it gets sort of centralized now, it’s, you’re going to this now public institution to purchase your cryptocurrencies that are going to report your year end summaries for interest and so forth for taxation.

Matthew Theal: Exactly.

Brent Pasqua: And so if you wanted to buy a cryptocurrency, but you don’t want to actually buy the cryptos, this is another way, sort of a public way or back way into the position.

Matthew Theal: Yep. A great one. It’s like the people who during the gold rush were selling picks and shovels.

Brent Pasqua: Right. All right. So retail sales rose during the month of March by 9.8% compared to an expected economists’ estimate of 6.1%. Sporting goods, clothing, food, and beverage led to gains in spending and contributed to the best month for retail since May, 2020, the gain of 18.3%, which came after the first round of stimulus checks. I guess, where do we start? And what do you think?

Matthew Theal: Oh. So do you remember back like three, four, or five podcasts ago where we were talking about how one conversation we kept having with a bunch of clients, perspective clients, and everyone’s how weak the economy was?

Brent Pasqua: Yes.

Matthew Theal: All I’m going to say is we told you. Like, everything is booming. Right now, you should not be concerned about the economy being weak. You should be concerned that the economy is getting too strong and too hot too fast because things are booming everywhere. And this number shows that.

Brent Pasqua: I also think, you know, the stimulus checks worked.

Matthew Theal: Oh yeah.

Joshua Winterswyk: I mean those $1,400 payments. And this is where, you know, they’re really showing the data that a lot of this money was being spent and that’s good for our economy. And you know you did say it, this economy was doing well. And it’s now even more data to support that. And we’re seeing that come to life. But you know, we did tell you so on this podcast, so that feels good, but yeah. And then also just might take is stimulus worked. And hopefully, you know, with everyone in this pandemic and all of this pent up demand that this economy still continues to do well and grow.

Brent Pasqua: It just seems like people have that extra money and savings and they want to start spending it. And whether it’s leisure or retail, I think, that’s probably where some of this money is going right now.

Matthew Theal: Yeah. Yeah. I agree. And then probably on the food scene too, as soon as, you know, with more restaurants coming online, I know food prices are a little higher and then travel as well. Just, you know, people are spending money.

Brent Pasqua: Yeah. And prices are getting more expensive. They’re not getting cheaper right now. All right. Let’s get into the main topic. Let’s get to the retirement planning corner. I think, you know, what we wanted to establish with today’s show is really going through some of the personal wealth destroyers, things that we’ve seen people make mistakes on and can really get you into some bad financial trouble. And not only can it get you in bad financial trouble, but it’s really hard to get out of. And so today let’s really start to get into some of these things that are really bad for your wealth, and also can impact you long term. The first one that we’re going to start off with is credit card debt. How do people really get into credit card debt?

Joshua Winterswyk: I’ll start with this one. Just in with a quick stat. So the average credit card debt per borrower is about $6,200. So there is, you know, a pretty large amount of credit card debt that hangs around American households. And, you know, it starts with just the easy idea, which is spending above your means. Right? We are spending more than we are actually bringing in and we’re using a credit card to financing the excess discretionary income. You know, other things that relate to credit card debt or medical bills, emergencies that aren’t planned for that come up, and just whenever your growth com isn’t as high as you expect it to be, right, we’re a lot of times financing on credit cards because we expect to get a bonus or we expect to get a raise or our income to increase, so we can support that a little excess spending.

Joshua Winterswyk: Credit card can just snowball. And we see it so much in our industry of people acquiring credit card debt and how it can just destroy wealth. To piggyback on that, credit card debt interest rates are outrageous so you’re just digging yourself in an even bigger hole when you get into high credit card balances with these high interest rates. And it’s just really, really hard to get out of.

Matthew Theal: Yeah. I think the number one reason, to me, when I see someone getting into credit card debt, I mean, there is the emergencies. Right? Your washer breaks. You have to buy a new washer. Well you don’t have the money to go put on credit card debt, but it’s really simple. You’re buying something you can’t afford. So if you don’t have the money, you can’t afford it. And if you’re putting it on a credit card, you don’t have the money. You can’t afford it. And to your point about interest rates, credit card is, what, 15, 20%, Josh?

Joshua Winterswyk: Mm-hmm (affirmative) It could be even higher than 20%.

Matthew Theal: Find me an investment that pays that.

Joshua Winterswyk: It’s not out there.

Matthew Theal: Okay. So that’s why you don’t put it on credit cards. Pay off your balance on a monthly, if you know, you’re making a purchase and you have to pay it on a credit card and you know it’s going to take you five, six payments to pay it off or more, probably can’t afford it, so save up a little bit more.

Brent Pasqua: So what are your guys’ feelings beyond some of the best strategies to get out of credit card debt? Because, I know Dave Ramsey is big in this arena. He has a lot of philosophies on it, which I think aren’t always terrible, but what are your strategies?

Matthew Theal: If you have a high enough credit score, like the role and the personal loan strategy, is that right on that one, Josh? So you could take it, if you have multiple cards, you could roll it into one personal loan, usually get a lower rate?

Joshua Winterswyk: Yeah. So you can do a consolidation personal loan, roll all of the credit card debt into one loan with a fixed payment, a fixed rate.

Brent Pasqua: That doesn’t always work for everybody though.

Joshua Winterswyk: No, it doesn’t, but I think it gives you a little bit of breathing room, not a bad strategy because you know, you might have multiple credit card. A lot of people have multiple credit cards. So rolling them all into one and having one payment is just a lot easier to manage. And so I think that it gives you a little bit more confidence going into this obstacle of paying it off with a little bit more confidence. Because you only have that one payment.

Brent Pasqua: And what about some of the strategies of paying off the ones with a higher interest rate or the paying off the ones with the lowest balances first?

Matthew Theal: Yeah, that’s great. So those are two psychological ways to pay off the credit cards. Mathematically you’d most likely want to pay off the one with the highest rate first, but it’s been psychologically proven that if you pay off the one with the smallest balance verse, it’s kind of like getting a small win and then you can keep going and working on your other cards. Because most people, what we find, is if you have a credit card that it’s spread across multiple cards.

Joshua Winterswyk: Yeah. And I think that both strategies, pick one and stick to it. They’re both going to, if you’re sticking to the plan, you know, are going to work. The highest interest rate that strategies, you know, you’re paying off the one that’s costing you the most, but the snowball effects of picking the smallest one and moving on, you know, you have those small wins, like Matt said. So I do like both. I think it’s more based on kind of personality and what your goal is, but picking the strategy and starting this journey of getting the debt paid off is the most important and stay away from the tricky rewards cards.

Joshua Winterswyk: I mean, credit cards are enticing you to use them. So don’t justify spending, you know, with earning rewards, if you can’t afford it. So find out and the first step of avoiding getting into credit card debt is find out if you could even afford it. We always go back to finding some sort of budgeting rule, have some awareness around your spending, and don’t use rewards from a credit card to justify spending.

Brent Pasqua: Correct me if I’m wrong, but the only real way to benefit from rewards is to pay it off every month.

Joshua Winterswyk: Yeah. I mean, you’re off weighing your rewards if you’re being charged interest by the credit card company. I mean, what is really then your net reward after you’ve paid them interest?

Matthew Theal: Yeah, I agree.

Brent Pasqua: Yeah. I think, you know, if you can’t afford it and you’re not in that snowball effect, I think there’s two things here. If you are in that snowball effect, create a strategy that works for you. There’s lots of strategies out there and then start chipping away. The other one is, is if you’re in a position where you just have one credit card or two credit cards and you have some debt, pay it off every single month and have it auto paid off so you don’t have to go in there and remind yourself because if you do miss a payment, that interest rate is going to get jacked up and you don’t want that.

Joshua Winterswyk: Yeah. You don’t want the interest rate. It can just be so expensive. I think on average, like $10,000 of credit card debt, if you only made the minimum payment is going to cost you about 30,000 when you tack on the interest. So look at how much you’re paying back to these credit card companies to finance just $10,000. It’s insane.

Brent Pasqua: So true. The next one that we got into here is one. I think that’s really important. It’s just a way of the times right now, and it’s in the media a lot. A student loans without high earning degree, what are some factors that make student loan debt concerning?

Matthew Theal: Oh. This is something I’m really passionate about, Brent. I’m glad you brought it up. The number one factor with student loans that really make them concerning is, one, there’s no time period. So theoretically your loan amount is infinite. Two, they have pretty high interest rates. And number three is if you file bankruptcy, you can’t discharge it. And what I don’t like seeing is people shaming other people online for like, you know, buying a $5 Starbucks or a $10 dinner every day or lunch. Right? That comes out, if you do that, the math a couple thousand dollars a year. Right?

Matthew Theal: But yet, you borrowed a hundred thousand dollars to go to school X,Y,Z at a six and a half percent interest rate. And you’re a hundred grand in debt by the time you leave college and you have an English degree. So your interest on that student loan per year is more than that cup of Starbucks coffee every day or that bagel, whatever it is. So people need to stop thinking about, you know, cutting those four and $5 expenses and think long-term of how much is college actually going to cost me. And do I have a degree that’s going to lead to high wages in the workforce?

Joshua Winterswyk: But do a lot of people at that age even have the mental capacity to think that far ahead or the desire to because, I mean, I think anybody graduating high school is not thinking about how much they’re going to owe. They think, okay, I’ll figure that out later. I just want to go to college.

Matthew Theal: And that’s on the parents. That’s on the parents who are listening to the show to tell their kids that, Hey, it’s not smart to borrow six figures to go to college especially if, you know, you’re getting an English degree.

Brent Pasqua: Would you say it’s a little bit on the schools as well?

Matthew Theal: Oh yeah, but they’re there to rip you off.

Joshua Winterswyk: And I think that is important to note too, is how school, the cost of college has increased. The cost to borrow for a college has increased and no one’s talking about this.

Brent Pasqua: That’s what I want to know.

Joshua Winterswyk: And it’s growing. Why is it so expensive to even borrow for college at six, 7%. I’ve seen student loans at 9% and most of them are backed by the federal government as well. Why are we charging these kids six, seven, 8% to go to school?

Brent Pasqua: Where is all that profitability that colleges are making, not only on student education, but on college sports?

Matthew Theal: It’s paying for those teachers. Maybe we’ve seen the Scott Galloway, the NYU professor. He makes a couple million a year just going there and teaching in a couple of classes at NYU.

Joshua Winterswyk: But I do agree with you though, Matt, and there is so many resources out there when you’re planning for college that it should be part of some sort of application process, but understanding what your overall cost of education is going to be. We now know the average and it’s so easy to find of what a projected salary is going to be like for an entry-level position at what you’re ever going to major in as well. So like we can do a simple projection of what, how long it’s going to even take you to pay off this loan with your projected income. And we can have a pretty good understanding. Sure, it’s not going to be perfect, but at least it can avoid you leaving college with this huge amount of debt that’s going to maybe even hurt your confidence. It’s just not even your pocket book, but feeling like you’re under this just pressure of this debt for five, 10, 15, 20 years. And it’s just going to hurt you from really accumulating wealth.

Brent Pasqua: I don’t understand how a person who graduates college, who has a $1,500 student loan payment is supposed to ever buy a house when they’re getting it entry-level job at, I don’t care what, unless they’re a doctor. I mean, doctors even, we work with tons of doctors and when they’re in residency and fellowship, they’re still struggling to get out of debt all the way up until many years in their career. How are they supposed to ever buy a house when you have such a large student loan payment?

Matthew Theal: You’re not and can’t have fun. I mean, after you graduate college, your first job, your twenties, your early thirties should be going out with your coworkers after work, you know getting a couple of drinks.

Joshua Winterswyk: Networking.

Matthew Theal: Networking. But if you’re constantly budgeting or worried because you got to make your student loan payment, that’s no way to live your life. So when it comes to school, you get the cheapest education possible. It’s more about how hard you work after school.

Brent Pasqua: See, and when all the media is talking about how the government should pay off people’s student loans, I don’t even want to go down that road. Because I think that probably brings up emotion and people have a lot of feelings on that. And I really don’t have that strong of a feeling either way. I think the true problem lies within the colleges that are charging this much for education.

Joshua Winterswyk: Yeah. And I think it just can be managed and regulated a little bit better. Let’s just all, I think we can all agree to that at least. These prices are going up so exponentially interest rates are growing up and no one’s even questioning it. And these kids are being left with these huge amounts of debt with no guidance. And then, you know what happens? They get a credit card and go back to wealth destroyer one and then start charging on a credit card because all of their money’s going to paying student loans.

Matthew Theal: Yep. That’s how it happens. Then you have a credit card debt and student loan debt.

Brent Pasqua: You know, and one thing that’s kind of been taken away when I see people get accepted to colleges now, for me at least. I’m kind of like, well, why wouldn’t they accept you? They want your money. Doesn’t everybody, every college want to accept as many people as possible to fill those seats?

Matthew Theal: Yeah. Yeah. I mean, that’s a good way to look besides that, I mean the top 1% of institutions where there’s too many applicants for-

Joshua Winterswyk: And they want certain criteria.

Matthew Theal: Yeah, for the pool, but yeah, for the most part, especially, you know, on the state school side, they’re pretty much just going to accept anybody.

Brent Pasqua: They want the money. All right, let’s get into wealth destroyer number three, spending too much of your income on a house or a car or any metrics that you could use when seeing how much a house you could afford and then integrating the car payment into that as well.

Joshua Winterswyk: Yeah. There are some really great rules of thumb when we’re looking at purchasing a house. The first one that I like to use is the maximum of basically your total housing expense shouldn’t be more than 20% of your gross monthly income. So you could take if you’re single or if you’re married, take your total gross monthly income times that by 20% and your total housing expense shouldn’t be more than that dollar amount. So that’s just a one really easy way to figure out, you know, can you afford this house?

Joshua Winterswyk: One thing I like to add to that though as well, because when you go to apply for a mortgage, a lot of people, maybe not running the calculation or using a calculator to find how much they can afford, they’re going to get pre-approved from a mortgage lender. The mortgage lender is going to tell you, basically, they’re going to go up to 50% of your income of what your max approval is. So they’re not looking out for what you can afford based off of a metric or a rule of thumb. It’s just the most that they feel you can borrow and which might not lead to great success financially.

Matthew Theal: Yeah. The PITI ratio is great. It’s my favorite. And that’s what you’re talking about, keeping it around 20%. one kind of thing on that though is if you do live in California or New York state, property prices are a little bit higher, so you can go up a little bit more, but for the most part, you probably should be below 25%. I think that’s pretty safe. As for the car thing, I don’t really have a good rule of thumb on cars, but like my own mental rule of thumb with people is whatever your annual salary is, you probably shouldn’t be buying a car that’s more than your annual salary. So let’s say, let’s say you make $50,000. You probably shouldn’t be driving a $65,000 SUV, which I know a lot of people do.

Joshua Winterswyk: It’s not balanced.

Matthew Theal: Yeah. It’s not balanced at all. You’re putting too much of your eggs in the car basket. You’re not in the Tahoe market. You’re in the Kia market at that kind of salary level. And then as you go up the income chain, I mean, it becomes easier to afford nice cars, but again, everybody doesn’t need to afford a Ferrari. Just because you’re making three, 400,000 a year, it doesn’t mean you need to own a Ferrari. I mean, I know Kim Kardashian and Kanye West and all those people that you see on TV do it, but they’re billionaires. And you know that you’re just a working guy.

Joshua Winterswyk: And that’s also for optics.

Matthew Theal: Yeah, absolutely.

Joshua Winterswyk: You know, it doesn’t also mean, we’ve seen famous people drive Priuses. Right? I mean, you need to have it all relative. But I think another way to answer this question of how much to avoid or how much to actually be spending on a house or a car is to work backwards. How much should you be saving. Right? You want that at least 10% of that net income to be saved per month. You want that even probably closer to 20%. Work backwards. First pay yourself. Save. Make sure you’re funding. We’ve talked about retirement accounts, 401k accounts, IRA accounts. So work backwards and setting up the savings accounts to seeing how much you got left over to spend on what you want. That’s going to give you a really good idea for the kind of like the car question as well.

Brent Pasqua: Yeah. I think, you know, one of the things that you’re always really good at doing with your clients too, Josh is creating the three buckets. Right? Discretionary spending, non-discretionary spending, and then your savings. Start with your savings and find out what your non-discretionaries are that you’re going to have that you’re not going to be able to change and then work on your discretionary is what you can control.

Joshua Winterswyk: Yeah, absolutely.

Brent Pasqua: Food expense and so forth.

Joshua Winterswyk: I mean, we can call that the 50, 30, 20, or like the use the bucket strategy, like you had just talked about as well. I think that’s a really good strategy to figuring out your monthly budget.

Brent Pasqua: So that 20 to 25% you’re talking about for the PITI does not include the car payment then?

Matthew Theal: No it doesn’t, but you could kind of use in a way debt to income as well to kind of see how much of a car you can afford. What are they going on debt to income, Joshua? Is like below 30%, you kind of want to be?

Joshua Winterswyk: Yeah, you probably want to be below 30%. And in Southern California, it’s hard because housing is just more expensive.

Matthew Theal: Right.

Joshua Winterswyk: But I mean, that’s a good goal to strive for.

Brent Pasqua: How did you guys approach this? So you know you guys have recently purchased houses. I mean, how did you guys approach this strategy?

Joshua Winterswyk: I just looked at my spreadsheet and said, man, it’s really expensive to buy in California, but I did exactly what we’re talking about. So I’m sharing my experience with taking first, starting with what our gross monthly income was, you know, breaking it down to what that net income is, especially with factoring in 401k savings, using that strategy of taking 28% of the monthly gross income to seeing how much I can afford for the house and making sure even with some of the others expenses that come with the house that I’m under that, and that’s really how I calculated what I could afford or me and my wife could afford for our new purchase.

Matthew Theal: Yeah. I did the exact same thing Josh did. You know, tried to keep that PITI ratio in the twenties, which we did, which was nice. But then again, I mean the other key here is Josh and I are both in our mid thirties, not to give away our age and we both just purchased our first home. I know Josh had a condo previously, but we waited a long time. Don’t put pressure on your kids or people to get a home in their twenties, because they’re probably not ready financially. And then they get into financial trouble that way.

Brent Pasqua: Yeah. And it leads to people start to want things and not really necessarily need them. You get that problem with a car or a nicer house or any of that.

Matthew Theal: Yeah, exactly.

Brent Pasqua: All right. Let’s get into that destroyer number four. Here’s one that might bring up some controversy though. And we do see this, a spouse that spends aggressively. What are some strategies that you can put into your marriage to possibly avoid this?

Matthew Theal: I think first off, this is something that probably creates a lot of divorces too. Right? Is arguments over finances, one spouse spending too much, or even it could go the other way. Right? Maybe one spouse is too conservative and it leads to lots of fighting and resentment. But, I think, the first strategy would probably be, one, you know, don’t criticize your spouse. Don’t go after them and be aggressive because all that’s going to do is lead to a fight, and you don’t want that. And most likely, probably the best scenario for you is to get some kind of marriage financial counseling.

Brent Pasqua: Which have become popular over the last half decade. Right?

Matthew Theal: Yeah. Absolutely. I mean, there’s people who specialize in that. Financial planning like that we do could help a lot, but for the most part, you’re probably going to want to bring a professional in if it’s causing a rift in your marriage.

Joshua Winterswyk: And if you’re just starting and you want to try something, I mean, I definitely always like to start with awareness. Right? If someone’s spending too aggressively bringing that awareness, understanding where that money is going, using the softwares that we’ve talked about on previous episodes to categorize the spending and bringing that to life, printing it on a piece of paper, putting it out up on the TV. Right? Maybe we’ve even implementing a money day between you and your spouse to go over all of this stuff because I think, I feel like a lot of even people we’ve talked to, you know, it gets pushed under the rug. We don’t want it talk about it because it’s not a fun conversation, but if we can make it more positive and make it more about what the future goals are about, I think that it can be definitely we managed. Because we know it happens and we can still find success in financial plans even if one spouse does spend aggressively. We just got to make sure we have a plan for that and a budget for it.

Brent Pasqua: I’m all in on this strategy or that you’re just talking about, Josh. I think numbers don’t lie. So if you have really good, let’s say, personal finance books and records, and you can tell where each dollar is being spent and where each goes, whether it’s house expense or utilities or food or clothing or wherever it may go, you may have the perception that one spouse is being too conservative or too aggressive. But until you actually have the numbers, you really may just be working off an opinion of some of the things, the number of packages you see being delivered to your house. But actually if you kind of got to the nuts and bolts of it and you had a actual books and records, it might not be as bad as you think and or it might be better. I think having those numbers could probably be pretty effective.

Matthew Theal: And the other thing too, I think the big thing on this podcast, one takeaway for you, listeners, is when it comes to your personal finances, in my opinion, don’t sweat the small stuff. I know a hundred dollars here and there adds up, but really you should be sweating the thousand dollar decisions, the hundred thousand dollars decisions. Because that’s where you really bury yourself financially. So if you know, your spouse is maybe spending a hundred dollars here, a hundred dollars there, and you don’t like it, it’s probably not worth the fight. Worry about the thousand dollars, a hundred thousand dollars spending problems.

Joshua Winterswyk: Boulders, not pebbles.

Matthew Theal: Exactly.

Brent Pasqua: Yeah. And you know what? You could hire a bookkeeper for a lot less than you can hire a counselor. So I mean, consider bringing in a bookkeeper to get your facts before, you know, you may want to consider getting a counselor because a counselor is going to add up too.

Matthew Theal: True.

Joshua Winterswyk: Definitely.

Brent Pasqua: The last one is the lifestyle creep. I have no idea what this means. So, Matthew, why don’t you let us know what is a lifestyle creep.

Matthew Theal: Yeah. So a lifestyle creep is as you go throughout your life and your career, generally for most people they have an upward trajectory of income and that happens, you know, between your really late thirties into your early fifties or kind of like your peak earning years. Right? And a lifestyle creep happens when you increase your expenses in proportionate to your raises. You should also be increasing your savings. So example, you get a big raise at work, you know, 20, 30, 40,000, whatever it is. And instead of increasing your savings, you upgrade to a Tesla from a Toyota. That’s lifestyle creep.

Brent Pasqua: Yeah. It needs to be relative, like you said. Income goes up, savings needs to go up. Investing needs to go up. You know, maybe even insurance. Wealth is growing. Ding. Ding. Ding. We need to increase the insurance as well. So all of those things need to be increasing relatively instead of just you getting a raise at work means now you have more discretionary income. That’s just not true.

Joshua Winterswyk: And I think a lot of new 401k platforms have, you know, some things in there that will, as you get older, it will auto increase or as you get a raise, it will auto increase. But for the most part, you got to go in there, and increase those. And you got to do it.

Matthew Theal: At the beginning of the year, Josh and I always bump our 401k contributions up.

Brent Pasqua: Just cost the company more money in match, huh?

Joshua Winterswyk: We motivate each other. You’re going to do it? Yeah. You’re going to do it? Yeah. Okay. Let’s do it.

Brent Pasqua: I mean, it’s so important. I mean, you know, the more you save the younger you are, the less you’ll have to save in the later life and the better lifestyle you’ll have because at the end of the day, that’s all you’re going to be able to live off. And when you retire as social security maybe, and then some savings.

Joshua Winterswyk: Yeah.

Matthew Theal: Yep.

Joshua Winterswyk: We got to plan now.

Brent Pasqua: All right. Let’s get into the last part of the show. Let’s go into RPA recommends. I’ll kick this one off this time on the recommends. This one I have UPLIFT desk.

Matthew Theal: Oh, come on, Brent. That was mine.

Brent Pasqua: Did you really have that one?

Matthew Theal: Yeah, I was going to say so just take it. We’ll both give it our best.

Brent Pasqua: Okay so we’ll both pull this in for today. So, because we’re doing a hybrid work. Right? We’re working in both the office and at home and Matthew and I both had needed to upgrade our desk at the home office and sitting all day long just really is not good for your body, decreases blood flow. And it’s really hard to just sit there all day. It’s hard on your bones. And so we bought an UPLIFT desk, which is it’s an elevate and auto, go back down and it’s been just very helpful to work part of the day by being able to stand.

Matthew Theal: Yeah, I agree. I mean, I can’t believe… I actually kind of had a feeling when I was thinking about mine. I’m like, oh, maybe Brent’s going to go with the UPLIFT too. But yeah. Amazing product. First of all, Haley, my wife, super jealous. She’s in there watching me on my standing desk. She’s like, oh, you’re standing and sitting. So she kind of wants one now. First of all, it’s a sleek looking product. Right? So it doesn’t look bad in your house. And it’s just really nice to be able to stand and work. I’ve actually been standing for all my client meetings now, and then when I’m doing kind of like hardcore work or writing, number crunching, I’m sitting. I don’t know how you like to do it, but for me that’s kind of what I’ve been working the last few days.

Brent Pasqua: First thing for me is like, when you’re starting off your day just standing, it’s so much better to start your work several hours just being able to be standing up because you’ve been sleeping all night. Right? So if you’re starting your day standing, your body has at least some ability to get that blood flow going.

Matthew Theal: Yeah. Standing early morning, I agree.

Brent Pasqua: And, you know, UPLIFT, I think from what I’ve seen is probably one of the nicest desk. You know, there’s a lot of these companies that are coming out here, but for it’s reasonably costs and it works really well.

Joshua Winterswyk: The UPLIFT desk, you can add a hammock underneath them. Do you guys have that?

Brent Pasqua: No, I do not. I do not, but they’re a cool product and I’ve found it very useful just the ability to stand during day.

Matthew Theal: Yeah. And then lots of different price points too. I mean, I think you can make a $5,000 desk or you can make a $500 desk. So whatever you’re looking for, it fits your budget, and it’s a really great product.

Joshua Winterswyk: I think that was kind of my point. They have so many accessories. I have a little bit of FOMO. I haven’t gotten mine yet, but…

Matthew Theal: You’ll get yours soon.

Joshua Winterswyk: Soon. Soon. Soon. Soon. Recommends. We opened the show with talking about LAFC. I recommend going out there and looking at your favorite musical artists, your favorite sporting event. As things start to open up, something to get excited about. I know we’ve talked a lot about just kind of planning for the future and have some finding some happiness spending. I’m really excited for this weekend, and just for some things to come in the future. So get out there and, you know, go look at tickets or to anything that you really enjoy entertainment wise. And I think that it’s going to be fun.

Brent Pasqua: Are concerts coming back?

Joshua Winterswyk: I’ve seen a lot of the concert talk or now that like we were even looking at tickets on StubHub, there are a lot of concerts that are being scheduled for like fall, winter, and early spring next year. So you can even go out there and buy them and they’re scheduled. So there, I think coming back, especially outdoors.

Brent Pasqua: So a couple of listeners reached out and had a follow up question. Did you get your new phone yet?

Joshua Winterswyk: I haven’t gotten my new phone. Not yet. No.

Brent Pasqua: So you still have the line going through the middle of your phone and you’re still waiting.

Joshua Winterswyk: I do. Yeah. I’m stubborn. Okay? So yeah. It’s more principle than anything.

Brent Pasqua: If you want an advisor who’s going to make sure that you’re really good with spending and expenses and staying within budget, Josh is your guy.

Matthew Theal: Josh is for sure your guy. He won’t pull the trigger on any expenses. I’m shocked he’s going to LAFC on Saturday.

Joshua Winterswyk: No. No. No. See, happiness, man. That’s going to bring me a lot of happiness.

Brent Pasqua: But the phone with the line in it…

Joshua Winterswyk: It looks like a light saber. I like Star Wars.

Brent Pasqua: All right. So as we kind of close this thing out as advisors, we love helping people and that’s why we’re here. That’s why we do the show. This is why we do what we do. If you’d like to schedule an appointment with any of us, please go to and schedule a complimentary consultation with any of your favorite podcasters here on the show. You can also download our ebook from our website. And if you like the show notes, please go to As always thank you for taking the time to listen. Thank you.

Joshua Winterswyk: Thank you.

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