Compound Growth

Episode 08- The Cost of Greatness

• Compound Growth • Season 1 • Episode 8

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In this wide-ranging and introspective episode, Colin and Wheeler explore the concept of unintended consequences—how innovations meant to improve life can subtly change behavior, expectations, and even our bodies. From the impact of cars and air travel on urban sprawl and health to the way apps like Robinhood have altered generational investing habits, they dig into how compounding effects aren’t always financial—they’re cultural, physical, and deeply personal.

The second half of the conversation zeroes in on the pair’s personal "money principles"—not rules, but values and frameworks that help guide intentional financial choices. Colin shares his "life equation," allocating income to long-term security and freedom spending, while Wheeler expands on the idea that “great is better than now,” drawing from Rick Rubin and personal experience. Together, they offer a grounded but optimistic look at building a life (and portfolio) aligned with who you are and who you want to become.

It’s not just about budgeting or saving—it’s about asking the deeper questions: What does great look like for you? Why are you spending money the way you are? And what trade-offs are you willing to make in pursuit of meaning? With real-life anecdotes and candid reflection, this episode is a reminder that personal finance is more personal than financial.

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Credits:
Created By: Wheeler Crowley and Colin Walker
Production Assistance: Tori Rothwell
Editing and Post-Production: Steven Sims

When you think of the greatest American innovations, right, there's a laundry list of them, and you can't say like one is the thing. You probably can, but I don't know what I would feel comfortable and confident arguing as like the greatest innovation. I may have one, but keep going. Okay. All right. Well, if- if you have one, I'm curious what it is. Th- Okay. feel like there's a list. If you ha- if you have a top 10 list, what, what, what's the one that you would share? Flight. Flight? Oh, wow, that's a really good one. That's a really, really good one. The world would be a very different place without airplanes these days. Yeah. Yeah. Yeah. Yeah. That's a really, really I mean, obviously there's also electricity, there's Yeah. I mean, there's telephones, electricity. Right. There's a million things. Yeah. Um, I don't think we can be credited with the internet. I can't remember which company that, or uh, country that technically was. I feel like that was us actually, but it doesn't Either way, like- Right. So flight is a really good one because no one believed it would happen, right? And then the people who invented flight didn't believe that, uh, some day you'd be able to fly across the ocean with it. N- no, never. Right? So it's like, it's, there's that compound growth aspect of it, and it's the concept that there are unintended consequences from some of these innovations, right? They didn't invent flying so you could fly to India. Sure. Right? So I was thinking about this on my commute today. Okay. Because I have a fairly convenient commute. Mm-hmm. Like under 20 minutes, there's not a lot of traffic, but recently there's been more- Mm-hmm. traffic. And- Summer and the sea coast. Yeah. Everybody's like, everybody's out and about, right? Yeah. But I was thinking about traffic and listening to a podcast about kind of like the American diet and obesity and like what contributes to the fact that Americans are statistically heavier- Yeah. than every other developed country. I think the thing is that like if you look at RFK, he's like blaming ultra-processed foods or whatever. Yeah. And that's like part of it. Yeah. But like what qualifies as an ultra-processed food is like a really wide category. Net. It's like organic food. Yeah. You can have organic You can have organic anything these And could have Mountain Dew- Right. and it's the same ultra-processed food. Yeah. Right? But one of the unintended consequences, I think, of American innovation is that we are walking less because Ford essentially really was at the forefront of the evolution of automobiles, right? Right. There was Germany and there was America, and that was always the case, right, in so many ways with industrialization. Do you know before the car was invented how far the average person would travel from their house each day? No, but it's gonna help me prove my point, so please share. About 150 meters. Okay. Do you know how far the average person travels now a day? Right. 20 miles. Right. And that's, that's actually, 150 meters is, I think you're factoring a lot of people that Like, I think if you live in the city, you'd trav- you probably travel more than 150 meters every day now. Well, you figure before the car, very I'll say cities were much bigger. Right. More people were in the cities versus- Right. I mean, there were a lot of farm lands and things like that, but, um, I'll say when you look at it from a total perspective, probably more people were commuting a shorter distance. Right. I mean, we know that to be the fact. Yeah. Yeah. And it's- Because you couldn't. You couldn't. There was the, it would take forever and there was no to it because there were these, the population centers, which are still population centers- Yeah. everybody was in the population centers. And you can look at that in places like Europe, right, where the countryside still is really just the countryside. They don't have the sprawl, the urban sprawl that we do here. Right. Right? So the automobile helped create the urban sprawl. Mm-hmm. And now when people want to go to work or to eat or to run errands, they drive, right- Mm-hmm. if you don't live in the city. Yeah. Well, when you go to countries like Europe or really kind of most countries outside of the US, maybe not most, but a lot, e- everybody walks everywhere. Right. Or bikes. Yeah. And we talk about this when like, I'm, I'm going to Europe. You've been to Europe a few times, right? Every time you come back from Europe, you talk about the diet and like how you like eat all this food and you don't gain weight or whatever. Right. And we th- we focus on the actual ingredients of the food, but isn't it also the lifestyle? How much time are you spending in cars when you go to Greece or when you go to Italy? Very little. Right? Yeah. Not like So I think that is absolutely a component to this. And if I think about my life, like I would love to be able to walk and bike pretty much everywhere. I love driving, but I also see the value in just being able to get around on my own 2 feet. And it, it's, look, I'm not advocating that we get rid of cars, right? I think it's just the, the point of this exercise as a thought exercise is to think about the unintended consequences of some of the things that we deem to be good and bad. Mm-hmm. Right? Like Robinhood, right? The Robinhood- The trading app? The, yeah, the stock app. Yeah. Right? I was pretty anti-Robinhood- Mm-hmm. for a number of reasons. 1, I thought that they were like gamifying investing, right? Like you would have confetti on the screen or like you'd do all this crap. It's like a gambling thing. Right. Exactly. But I heard somebody recently posit a theory that part of the resilience in the stock market right now, at least with the younger generations, is that they became very familiar with volatility. And they became kind of used to like the ups and downs and the extremes of the stock market. And they've been trained to buy on the, buy the dip or to just kind of ride out the volatility or whatever. And Robinhood actually did make it easier. They, they removed barriers of entry. in ways that, like, the old trading platforms never quite did. So is it the s- case, and I'm not familiar, I mean, I know what Robinhood is but I don't have an account, we can't have an account- No, of course. in our position, but with that being said, will they incentivize someone to buy when the market is down? I don't believe they're prompting anybody- Okay. to buy. I think that they just, it happened to coincide with COVID and all the craziness that we've seen. the GameStop and all that, yeah. yeah. So I think that it's, like so many things that happen in history, it's like a moment in time that something comes to fruition and people, like, latch onto that and then it changed their behavior, their investing behavior. Like if you were, you know, I have, I have a good friend who was working in tech before the tech bubble, right? Yeah. And a lot of his equity was tied up in the company that he was working at, and that company went under, right? That sucks. So his, his relationship with stocks was very, very different. Right. Right? People who really suffered during the financial crisis have a very d- different relationship with markets, right? Absolutely. Uh, I think it's just, it's really fascinating to me that I was anti-Robinhood and I saw a lot of issues with it, and I still believe that those were issues, but sometimes good things come from bad things as an unintended consequence. There are definitely some bad things that can come from good things, but then I guess, what's that saying? Like, too much of anything is, can be a bad thing. Well, yeah, yeah. Yeah, yeah. Yeah, I mean, you can argue that air travel now has certainly, um, homogenized the world. Mm-hmm. You know, it's very easy to get to places. Like Haley and I were talking about doing a one-year anniversary trip and going to, like, Arizona or California, and then, the, we were like, "It's quicker to get to Portugal." It's, it's true though, from Boston, and, um, it's a lot less expensive. So that is true, but it leads to a lot of greenhouse gas emissions. Yep. The actual, I'll say, like, process of traveling sucks. There are some negatives to it, so And the same way with cars, um, not just, like, greenhouse gas emissions from exhaust, but also the production and all that other thing. Sure. But then you can argue that it also leads to more jobs and- Yeah. so Yeah. It's, it's, I think it's, it, all of these innovations create multitudes, right? They contain multitudes, they create multitudes, and I think you have to look at them as not all good or all bad, as we talk about a lot. Um, but I just, I, it's also useful to think about these things and not just, like, kind of pass through life floating along and not really wondering about unintended consequences. Right. Yeah, that's true. Yeah. It's a good point. So as we think about things and we think about our financial planning and the advice that we give to our clients, you and I talked about doing some money rules. Do we wanna call them money rules? Money tips? What do you wanna call them? Yeah. Uh, maybe, I don't wanna say guidelines, that sounds like a, that sounds like a not fun word. Yeah. Yeah. But like- Rules aren't fun either. Yeah. Rules aren't fun either, but- Yeah. uh, maybe principles that we tend to- Ooh. Mm-hmm. lead our own lives by- Mm-hmm. when it comes to our finances. Yeah, principles. things that I'm often thinking about when I make decisions. Yeah. Or beliefs too. Or belief systems. Right? Yeah. Yeah, belief systems, okay. Anchors. Values. Yes. All right, we'll figure out exactly what we wanna call them. Many, many, uh, synonyms. Welcome to the Compound Growth podcast with Colin and Wheeler where we talk all things growth. From financial growth to career growth, personal development to societal progress, we explore how each layer builds on the next, compounding over time to shape who we become. Each week, we break down complex ideas and emerging trends into clear, actionable insights, because growth isn't just about numbers, it's about understanding the world and our place in it. The information in this material is for general information only and is not intended to provide specific advice or recommendations for any individual. Investment advice offered through Integrated Partners doing business as CoFi Advisors, LLC, a registered investment advisor. Integrated Partners does not provide legal, tax, mortgage advice or services. Please consult your legal tax advisor regarding your specific situation. Past performance is no guarantee f- of future results. All investing involves risk, including loss of principal. No strategy assures success or protects against loss. The economic forecasts set forth in this material may not develop as predicted, and there can be no guarantee that the strategies promoted will be successful. I think it, overall, they're- they're essentially core concepts, right- Mm-hmm. however we wanna label them. They're just- they are ideas that we repeat regularly with our friends, family, clients, whatever it might be. I'm excited about this one. Yeah. I would like you to start. I feel like- Damn, I was just gonna say, I think you should start. you're gonna No, go first 'cause- because, again, you and I haven't told each other what we're gonna share here. No, we haven't. There's absolutely risk and danger of overlap, so- There is. I- I- don't feel advantage. I'm quite curious if there is and is not overlap, and what that is going to be. Yeah, Okay, so I'm going first. You're going first. All right, my first one, I'm a math guy. Mm-hmm. Anyone that doesn't know me, I'm a spreadsheet guy, and I have a life equation. Okay. A life- wait, a life equation? Not really a life equation. I'll say a spending equation. Okay. Okay. Mm-hmm. So- and it's- this is a deeper topic that I'll get into, but I'll- I'll just give you the formula at first, which is essentially, I take 20% of gross income, set it aside for retirement. Then, I take 10%, set it outside of non-retirement. Mm-hmm. So, then I try to, after all of that, keep my expenses to 20%, so then I have 50% remaining for spending, okay? Okay. And my thought process is there, take the retirement away first, take the, I'll say, emergency fund away, or the non-retirement stuff, because, you know, maybe I don't wanna wait 'til 65 to retire. Mm-hmm. But then, on top of that, that remaining 50%, after everything's kind of covered, I'm able to do whatever I want with it. That's my freedom money. And the way that I look at it is, once everything's taken care of and everything's removed from the plate, and I tell clients this, too, "Whatever your excess cash flow is, I don't care what you do with it." If you wanna go- go buy a gold-covered latte- Mm-hmm. every morning, it- it doesn't matter to me. As long as you- if you tell me that these are your goals over here, and you're prioritizing those goals, and if you're putting effort into those goals, anything excess on top of that, I think you should have free rein to do whatever you want, getting back to the obesity thing. Okay. Uh, Kaylee told me something interesting yesterday. She follows this, um, dietician on YouTube, and the dietician always talks about, no matter what advice I give to my clients, I never change their morning coffee routine. Hmm, okay. Because a morning coffee routine is sacred. It's ritual. It's ritualistic. Mm-hmm. And if you have something that's so ingrained in someone, like someone has a priority, and their priority in the morning is coffee, the worst thing you can do is change that, because then that changes their mentality. That- that has a negative impact, because they enjoy that thing so much. So, for me, I have my own financial priorities, which is where that 50% kinda goes towards and leans towards, like going out to eat or travel, whatever it might be. But, um, with that, you know, it- it's- it's kind of the fun of it, like- Okay. to have that freedom. So, it- it helps you connect with the purpose of the money. It helps you have an emotional relationship with e- you know, I feel like sometimes- I had a client yesterday call, and he essentially wanted permission to spend money, right, which always makes me- love these conversations. It always- always makes me feel like I'm in an awkward situation. I'm like- Like you're the parent. what, yeah. Yeah. And he joked about it. He's like, "Daddy, can I have some money?" And I was like, and he knows that it's, like, kinda silly. Like, he's not- but I feel like there's some level of truth to it. Like, he's asking for permission, right? And it's not because I have to purse strings. It's, you know, he could log into the app and get the money out himself. Of course he could. What he's really looking for is reassurance- Mm-hmm. right? And, "If I spend this money, what do I do now?" Right? He happens to be in an industry, he's in the entertainment industry, um, that town has really, really slowed up. So I have- you know, I have one client who, he told me, he also works in the industry, he gets at least 5 emails a day from somebody being, you know, or from 5 different people saying, "Does anybody have any work?" Oh,"You know, I'm looking- I'm looking to do this. Can you help me out?" Right? Yeah. And it's just because things have really, really slowed up on the production level. And that's a whole other can of worms to explore. Yeah. But this client happens to be in a place where he's in between projects right now, which is the tough part of that- That is. of that life. And, you know, so it makes him a little bit more cautious. He doesn't have money coming in. All he sees is money going out, right? So, that changes his relationship with his portfolio, and it changes his relationship with his spending. Interesting. Yeah, for me, I- I think if you have financial priorities, as long as they're within reason- Mm-hmm. I think it's fine to be unapologetic about it. Yeah. You know? I- if you're the type of person that's really into cars or travel or eating out, or whatever your hobbies might be, clothes, fashion, that's fine, but accept that- recognize that that is a place that you would want to put some money, but then set parameters and guidelines around it. So for me, it's, I'll say, um, dining and travel- Right. are 2 things I really enjoy. And I don't necessarily, in my life, you know, I, I look at something and I say, and this is something that you taught me- Oh, okay."Great is better than now." Mm-hmm. So when it comes to my financial priorities, if there's something I really want, like let's say Kaylee and I wanna do a trip to Africa, and I can't afford to do it in the way that I want to do it in the next 6 months. I would rather not go and delay that so I can get exactly what I want and take that excess cash flow, set it aside so I can get the exact trip that I want- Mm-hmm. then go now. I would much rather wait, take that excess cash flow, set it aside, save so I can get exactly what I want. And then when I get it, I'm unapologetic about it because I know I've worked hard to do it, all these other goals and priorities over here are taken care of. Yeah. Yeah. So that's my life equation and kind of how I run my own finances when I get a paycheck. So I have multiple thoughts on all of that. And I will say that the client who was calling and talking about what, what could he spend, right? I know that the things that he- are really important to him in his spending- Mm-hmm. are travel- Mm-hmm. spending time with friends, skiing, things like, like there, these are, these are things. He's not asking, "Can I go buy like a new-" Ro- " 78 tomorrow or something." TV." Yeah. Whatever. Yeah, exactly. Like, he's, he's just trying to live the life that fulf- he finds fulfilling. Mm-hmm. Right? And so he, to your point, I feel like this is money that is set aside for that purpose, um, but there's also some anxiety around that. Um, I think what, what was the percentage that you set aside for bills again? Was it 20%? Yeah, it's 25%, really. 25%. Okay. Yeah. Yeah, yeah. So what if somebody is in a position where the bills are 50%? How do they manage that? I feel like this almost goes back to our last conversation a little bit. Yeah. Some bills are impossible to kind of avoid. Mm-hmm. Right? But for me, there have been times in my life where my bills have been certainly more than 25%. But it's a goal of mine to get my bills down to 25%. Mm. Or to increase your income. In- exactly. Yeah. So there's 2 levers that you can pull. Yeah. You can either spend less or make more. I found when it came to the expenses, you can only trim so much. Mm-hmm. You know, like, you can't not have a place to live. You can't not buy groceries. You can't not put gas in, in your car or pay for insurance. Um, you might be able to get away with not paying for insurance for a while. But anyway. I did not have health insurance for, like, a decade. Same. So- With that being said, when you look at those 2 levers, I found whether it was through picking up another job, whether it was through working longer hours, whether that was, you know, setting more goals in our business so we could try to, you know, scale up- Mm-hmm. whatever it might be, my goal was to get it to that point. Yeah. I think that, um, maybe the, the, like, if you were to distill that down to a certain And I guess the part that I latched on being, like, the, the free spending- Mm-hmm. aspect of it. I think it's finding some denomination or, like, some percentage of your money that you, uh, you can spend freely without having to second guess it or worry. Yeah, I think when someone looks at something and says, "That cost is ridiculous," or, "Something's too expensive," or whatever it might be, maybe it is to you. Yeah. Like, when I go and look at someone buying a luxury designer whatever it might be, or paying for some sort of experience that I may not necessarily enjoy, that doesn't mean that it's a bad thing or that it's too expensive or it's too this or too that because the fact of the matter is, is that if someone's willing to buy it for that price- Mm-hmm. then it's a justified thing, you know? Then that's, means the price is fair. If we go, I just mentioned Rolex. You know, a Rolex can be anywhere from 10 to hundreds of thousands of dollars. Mm-hmm. 10,000 to hundreds of thousands of dollars. Doesn't mean that it's an outrageous amount of money. It is, but the fact of the matter is, is there's a huge wait list and people want to buy that product. Mm-hmm. So is it overpriced? Uh, you could argue no. Well, yeah. I mean, look, we, you assign value, right? Exactly right. Somebody assigns the value. That's what happens. Yeah. So for me, um, I put my value in certain categories and I know to lean into those categories because it's where it's gonna give me the most joy. If I'm to go out and buy a bunch of clothes tomorrow that, y- you know, I don't Like, that's not, I'm not a very fashionable person. So I think you're very fashionable, Colin. Thank you. I appreciate it. Um, all right. So do you feel like your, uh, kind of standard of these set of, like, the allocation that you bring to your finances for spending purposes, is that something that you came up with? Is it something that was taught to you? Where do you think this came from? If I'm to rewind the clock back to maybe, I'll say, a few different points in my life, um, I recognize that wealth is created by free cashflow, and the more free cashflow you have, the easier it is to create wealth. And I never really wanted to get to a point where my bills became such a big part of my income that I didn't have the ability to save. Mm-hmm. And I, I saw that happen a lot with people and the mentality of, you know, "We'll, we'll just continue to push back all these life things that I wanna get done because we can't afford it right now." Like, I, I would rather have a lower quality of life or work hard to increase my income to the point where I have that flexibility. Yeah. So that was always my priority. Yeah. It's funny because when I was growing up, I had, you know, I had my mom and her relationship with spending, and then I had Jessica's parents and their relationship with spending, and it was completely different. Interesting. Right? They, they were, they My mom was like, "We can't afford to travel. We're not ev- We're never going anywhere." Yeah. Like, we went to, to Maine for a weekend for my birthday every year, and that was the extent of my travel- Yeah. for many, many years. And Jessica's parents would be very much the opposite. Travel was like core to their- Mm-hmm. Like, it was a core value for them. Of course. And so it took prioritization in their cashflow. Um, and it's, you know, then you, it, it, we get the combination of both of those things when Jess and I lived together and, and started a life together. And, um, it's interesting how these 2 pieces can come together in creating new, you know, approach to spending. Yeah. I think I, I heard a quote from a gentleman actually at the coffee shop the other day that I always go to. Mm-hmm. And he said, um, "Never plan in the middle." Okay. And I thought that was an interesting quote, and I've been digesting that over the last few weeks. Uh, and I think what that distills down to, in my mind, is don't just try to spend money on everything. Mm-hmm. Figure out what your priorities actually are, and then lean heavy into those priorities. And the things you don't care about- Yeah. go for value. And i- like, if I'm not super I'll just keep using clothes. Like, if I'm not super into clothes, I'm not gonna just go out and buy a bunch of designer stuff to try to look a certain way or feel a certain way. I'm gonna recognize that that's not my priority. I'm gonna wear nice things and try to dress appropriately, obviously. However, that's an area, in my mind, where I'll try to save some money so I can spend over here for more experiences that I enjoy. Yeah. So your first, uh, money habit touchpoint covered like 3 of mine. Okay. Um, so- Interesting. So Well, now I wanna dive into- Yeah, yeah, yeah. exactly what you had. Yeah, yeah. So the formula, I think, is obviously a big thing because that's the mentality of kind of how I look at things, but- Yeah. Do you have something similar, and what exactly is it? So I think what's, what's funny is that, um, I'm just gonna pick and choose. Uh, I, I'm gonna go with one that you, you brought up, which actually is the great is better than now quote, right? I thought we'd have some overlap there- Yeah. considering you're the I stole that quote from you. You stole it, but I stole it from somebody else. Okay. So I stole it from Rick Rubin, music producer, right? Yeah. A little zen guy- Okay. um, who I, I really, really respect, um, for his ability to help artists find the sound themselves. Like, there was a great interview that Rick Rubin gave, um, when he wrote this book, um can't believe I can't remember the name of the, of the book. It's something, it's about art, right, and how to think as an artist, right? Hmm. And, um, and so he sat down with, I think, like Anderson Cooper or somebody. Cool. And, um, Anderson Cooper, I'm assuming it's him, says to Rick Rubin, "So you don't play any instruments?" And he's like, "Nope." He's like-"And you don't, you don't, like, mix or touch the soundboard?" He's like, "Nope." What is say you do here? Yeah. That's exactly it. Like- wait, what do you actually do? And, uh, what he does is he helps people understand, right? He kinda curates their own thinking, right, and helps them find their sound and their It's, it's so intangible. that I absolutely love it because I think that when we are meeting with clients, it's one of our greatest value adds. It's, like, helping them understand themselves, helping them understand their influences, their money story- Mm-hmm. markets, whatever it is. It's, it's thinking and understanding and in a lot of ways, with Rick Rubin anyways, it's feeling. It's, like, connecting, and this gets a little, what do they call it, woo-woo, I guess? Um, but it's connecting with the universe and I am woo-woo and love to connect with the universe. Um, so I, I really respect that. But the great is better than now, I don't remember where I heard him say that. I think it was in, like, a podcast actually. Um, but it, I think of that as just a, it's almost like a mantra. Like, it's a reminder that when you are saving for something, it's not just because you have to, right? Mm-hmm. It's because you're working towards greatness, right? And I think that ideally, there's, there's some version of the future that is very mediocre or stressful or, you know, really painful. Um, and when you save for the long run, you know, we talk about the, the number one reason to invest is to outpace inflation, right? Sure. The number 2 reason is to improve your lifestyle. Mm-hmm. Right? And then if you wanna think about getting rich, fine, right? But that last thing is less likely lot of people think by being rich, their lifestyle will improve. Sure, but it's, I think it's marginally. Let's say that, you know, if you're, if you have to keep up with inflation, inflation is historically like 3 percent-ish. Mm-hmm. And, you know, then you get a 4% return, then you've marginally improved your lifestyle. If you get a 10% re- return, then you've improved it by that much. Mm-hmm. But I think it's, it's saving for a better version of your future. Um, so when you, when you think about the retirement planning or saving for decades down the road, that's kind of what I'm thinking about. But when I think about what I'm gonna spend my money on, like, this week or next year or the year after that, to your point, uh, you know, if there's a trip you can't afford, but you really wanna go that, on that trip, don't go on a different trip that sets you back from getting- Exactly, yes. you wanted to go to. Yes. That's very well said. Yeah. Yeah. I have made this mistake so many times. And, uh, again, like, most of the things I learn, I learn through trial and error. Yeah. And, uh, you know, when, when we bought the house that we bought, we arguably settled. We really liked the house, but we didn't take, we didn't take time to think through the decision. We had just been under contract with a different house, and that one fell through for various reasons. Mm-hmm. And we found ourselves kind of desponding, kind of, like, uh, you know, we were really looking forward to this one thing. Our current house came on the market, like, a week or 2 later, or at least i- it was put in front of us at that point, and we kind of just jumped on it. We went there, we loved it, and we jumped on it. Yeah. And for years since, it's been 10 years since we bought the house, for years since, it's been, "Boy, we wish we'd bought in a neighborhood." Or- Mm-hmm."Was this the right town for us to live in?" Or, like, it, it just felt like we really rushed that decision because we really wanted a house and it didn't, we didn't take time to really think about the, you know, the unintended consequences of that decision. Um, or if this was the house for us. And it was a different housing market at the time. We didn't have to rush, right? It was, this was, you know, 2015. Um, you know, the market was still, uh, God, it was valued at like half of what it's like now. Right. Right? And you probably had a million open houses that you could go to, pick of the litter. We, we to so many open houses. Yeah. And we were like you know, or we'd, like, get all these private tours. Like, there was no bidding war. Right. Like, we could've taken our time. And I actually do love my house. All the issues I had, I still have. Mm-hmm. And, you know, it's just like we said at the beginning, it's, you know, it's, uh, it's good and bad. I think as you were talking, it just reminded me or made me think of a money rule. Hmm. And I'd be curious to get your take on it, which is, be specific with your goals. Hmm. Because if great is better than now, I think it's important to identify what great is to you. Mm-hmm. If you don't know what great is, let's use your house as an example, you know, it, maybe, and I should've done this with my own house, um, similar situation to you, but long story short, if you were able to identify, "I want this size house, in a neighborhood, in this general location, for this specific price point, with this layout," like the more specifics you can add into your goals, maybe you can identify what greatness is- Mm-hmm. and lean into that because, I don't know if everybody's able to identify with their future self so much to, uh, to know what great really is and that's maybe a tough concept. Yeah. It's, it's true. And I feel like it's the next layer down is why- Mm. is that great? And that's actually one of my rules, it's one of my core rules is, uh, start with why, right? Right. Again, stealing from somebody, borrowing from somebody else. But, you know, the, if we had taken time, and I think you're right about, um, really crystallizing your goal. Right? If we had taken time to do that and think about all the things that we were looking for in our lives, because a house is a big component of your life, and your, your lives surround that house is kind of like the anchor, right? Mm-hmm. But you branch out from there. If we were thinking about what we wanted, the next, the real work is why you want it. Like, if we want that tree-lined street and kids running around- Right. and if we want that vision of America, it's because it was fed to us. Mm-hmm. Right? Yeah. And we constantly s- get that experience for small, in small doses and realize that like the, the relationship that we have with our daughter, which is really, really strong, arguably, would be weaker if she was gone all day playing with kids because she lived- Fair. in a neighborhood that we wanted. Yeah. know? That's an interesting point. Okay, so question for you. Can you give an example of something that you envision in your mind that is great that you are delaying gratification for? I can. Um, and I'm going to, I'm going to, uh, say first and identify that I'm coming from a place of privilege here. Okay. Um, and- But hard work. But hard work. You weren't, you weren't always in a position- Yes, yeah, yeah. Yeah. And, uh, it's, but it's related to the house situation. And, um, I get, you know, I was thinking about this obviously on the commute in and like, you know, what my ideal daily lifestyle sh- would look like and how I'm gonna get to that. Um, and it's, that's, uh, I guess, my permanent residence or the, my main core home is, is, is something that probably isn't going to stay the same. Okay. But when I think about, and, and you know this about me, I've been g- talking about buying a place in Vermont forever. Yeah. Right? And I know why I want a place in Vermont. I know how important Vermont is to me, Jess and I growing up there, what the state means to me, what I feel when I'm there. All of that, I've known and crystallized for a long time. Mm-hmm. But I'm still working out the great. And when I, like, narrow it down to these 2 communities that I'd like to be a part of, there are some, like, really clear differences. And I have to go back and forth in figuring out what I want from the community, and then what I want from the house, and then what I want from my, like, life while I'm in that house- Mm-hmm. and why I want this in the first place, right? Like, is it just so I'm back in Vermont? Well, it's not full time. Right. We're here, right? Yeah. Um, but I know that I, I have this kind of like idea of a multi-generational point that we can all return to- Yeah. wherever our lives go. And I know that where we are right now is well, actually, I don't know, but I don't think it's going to be where we are right now. Got it. So, create a new home with new experiences that everybody can come back to that's like a home base for you guys right now, but also M- like, family in the future. I think it's not even a home base for us. It's like, I think So Jessica's family has this tiny little cabin on a lake. Mm-hmm. Very rustic. Um, not, it's not all season, right? Like- Mm-hmm. you can only get there for, really, it's like 4 months a year where you wanna be there. Yeah. And that 4 months is- divvied up among all these different people, right? So you, we get, I get, uh, like, 10 days a year in that spot. Just to you guys. Right. And there's a ton of, of work that goes into the property and time that goes into it, et cetera. Um, but I see how that family, which is partially my family, but that family has really connected to it. It's an anchor in generations for them. Cool. You know, it was Jessica's grandparents that had it. Yeah. And ideally, it would be Michaela's generation that, like, benefits from it in the future. Right. Right? So s-I guess because I've seen that, I've recognized that I want that as well. And I also want to insulate myself against something going wrong with that property because it's still, I've married into that family and they've- Mm-hmm. embraced me and they've taken me in and that's great, but man there's a lot of drama- around that property. That's family for you, yeah. Yeah. And, uh, so I, well, I don't wanna lose that type of experience and so I wanna recreate it and have maybe a little bit more control over it. I remember and I've told I remember, I think I told you this last year or the year before, but, um, I spoke with an architect a while back and, um, him and I just kind of developed a relationship and, um, chatting back and forth. And he was telling me that, and he builds some amazing homes in Cape Cod and Nantucket that are exorbitantly expensive. Yeah. Uh, not- not my house, but- long story short, he tells me that when he sits down with a family for the first time, he gives them each a journal. Mm-hmm. And he says, "You know, when you go and think about your house, I want you to take this journal and write out your perfect day." Mm. He goes- Such a good exercise."When you wake up in the morning, what is your view? When you wake up in the morning, are you reaching to your bedside table to grab a cup of water or coffee? Are you turning on a bedside light? Are you g- grabbing a book? You know, what does your journey look like in the morning to either get a coffee, bathroom? Are you going to wake up kids?" Yeah."Like, what does that path look like to you?" Right, right."You know, when you sit down for breakfast, is it you cooking? Are you going out to breakfast? Where are you going out to breakfast? What's your favorite spot?" And he was just like, "Is it a coffee shop? Is it a pastry shop? You know, what does that look like? Because then we can narrow down the lot location." Yeah. And then he was like, "You know, do you want privacy or do you want a big, expansive view? Do you" Like, and- and just the amount of detail that he's requesting, he was like, "When you come back, this 100-page journal should have, like, 30 to 40 pages filled." Of detail. He was like, "I want every single thing down there to, like, the light switch you flip-" Yeah."when you go to bed at night." Yeah. And that, to me, was unbelievable, that thought process, because if you are able to give someone that amount of detail, then you know specifically what it is great is to them. I think that you could remove some of the privilege from that and still benefit from the approach. 100%, right? It's, I think, it's Sometimes it feels like you need to have these prompts in front of you to really know what This checklist, like it's, I love checklists because they're just reminders to think thoughts. Mm-hmm. And, uh, I need a lot of reminders because my thoughts go, like, just everywhere. Me too. You know? Yeah. Um, so that book, by the way, the- the Rick Rubin book is The- The Creative Act. Okay. Thank you, Tory. And uh- I will will have to look into that. It's, uh, I, you know, it's funny. It's a difficult read because it doesn't feel very grounded. It goes, like it just like I- I take it in small doses because there's very little concrete to it. It's all ideas and they're- Mm-hmm. all kind of floating around and they're like loosely gathered, um, but I think that- Very woo-woo. Yes, it's very woo-woo. Very woo-woo, which I don't, I- I'm told there's- there's a negative connotation to that, uh, term, but I- I think it's pleasant. I, you know, whatever, it's, uh, I think whatever it's describing is very important. Of course. Um, yeah. Okay, so rules. Thinking about how you allocate what, you know, your pie chart of expenses. Yep, my pie chart, my equation. Yep. You, great is better than now. Great is better than now, yep, and also start with why, which is a whole other can of worms that- Yeah. we don't have time to explore right now, but you know, when I ran into you before we get to the office today, you're like, "Hey, I don't think we're gonna have time to go through all these rules." And I was like, "What? Oh yeah, you're right." I told Kaylee this last night and we were going over the prep for this podcast and I was going over my list of rules and she was telling me, "We should just break all these out into different podcasts" because she was, 'cause just like, "You and Wheeler are gonna take like 45 minutes on each one of these." It's true. It's true. Um. Yeah. So, so- Well, I guess thank you, Kaylee. I was gonna thank you, but if Kailey gets the credit, then Kailey gets the credit. I ca- I can't take credit for any of these good ideas. Do you wanna do one more before we wrap up? I do, yeah. Um, I'll go with this one, which is, uh, buy the best and keep it. Oh, I love that. Say more about that. Okay. Um, it is really expensive to have regret. Mm-Hmm. Yeah. Regret minimization is key. Regret minimization is key. Yeah, And this, I'll say, builds on that last thing that we were just talking about. Mm-hmm. Um, I'll say that, like, maybe when you buy a car or something, or if you have a major purchase coming up, recognize what it is specifically that you want. Mm-hmm. And if you can't afford exactly what it is that you want, the risk there is that you're going to buy something, have regrets, and then want to sell it, and then buy it again. I th- I can't remember the exact stat, but, um, you're buying furniture right now. Mm-hmm. Did you know that 70 to 80% of furniture ends up in a landfill and doesn't get sold? That's depressing. It is very depressing. And the reason for that is because furniture nowadays is very cheap, not built, you know, super nice obviously, depending on where you get the furniture from. But a lot of the times people will refinish their house all the time and not like it, throw away the furniture and redo it. That's really expensive. Versus, if there's something you really love or a design you really like, or whether it's a car or, you know, a trip, or a pair of shoes, whatever it might be, recognize what it is specifically that you really want. And if you can't afford it right now, don't go buy something else, and you already said this, don't go buy something else because then you're gonna have regrets. You're gonna wanna buy something else, which is gonna cause you to spend more money. Mm-hmm. Get what you specifically really want, treat it really, really well, and hold onto it and appreciate it. I think that's great because friction, financial friction- Mm-hmm. is such an erosion of wealth, right? Like it's- Totally. you know, this is, this is really why I'm anti-starter home in a lot of ways, because you can find yourself in a situation where you buy in, you know, 2015, and by 2020 things have like COVID happens and like things go crazy- Totally. and you're, you know, you appreciate like, like crazy. But that's not, that's not normally what happens. That's very unrealistic. Yeah. You the starter home itself, like point of it is to be there for a short amount of time, right? Mm-hmm. Maybe it's 7 years at the, on the, on the long end. So in that time, when you buy the house, you pay fees, you pay taxes- Yep. right? All along the way, you're paying taxes, you're paying maintenance, whatever it is. And this is why- Interest. Yeah. I mean, this, this goes to one of my other rules that, you know, your house is not an investment. Your house is a home, right? Mm-hmm. Some properties can be investments, but not your primary residence. Mm-hmm. Because you are going to spend all this money in the time that you were there. It's not You're gonna look at it and say, "Well, I bought it for X and I'm selling it for Y, and I made all that money." And that's just not true because you have to run through all of your spending and all the friction- Totally. along the way. Yeah. Like, I, I was at, at a wedding not too long ago, and, uh, one of the gentlemen there was a car salesman. Mm-hmm. And, um, nice guy, you know, I knew him from high school and all that good stuff. And we were talking about how Kailey, you know, will eventually need a new car because it's got a ton of miles on it, but we're just gonna drive it into the ground. But he was saying, you know, "Oh, well, you guys, you know, you don't have kids right now. So what you need to do is get like a fun flip car, and then that will-" float you to the next car. And then once you get that-" Yeah. you get one kid, then you upgrade it to the 3 row." And I'm like, "Or we could just drive Kailey's car into the ground and then buy one big car if we need it, and just hold onto it for as long as possible, versus continuously buying depreciating assets-" Mm-hmm." and getting hosed along the way." Yeah. It's really expensive to continuously purchase depreciating assets and have that erosion. And now I'll push back and say, if you're looking at that depreciating asset as an experience, right? If that's your financial priority- If that's your point, right. Yeah. But if you're looking at it as like, I wanna hold value and be able to trade this in or whatever, sometimes you just need to recognize that you're spending money, right? Totally. Just recognize that this is not an investment. Absolutely, yeah. You know? Like if I think about in the 10 years I've owned my house, the furniture I bought for it that might not fit in the nice house- Mm-Hmm. or the next house that I have or whatever, I have a nice house now. Uh, it, it would be all the rooms that we've painted, all the taxes we've paid, all the insurance premiums we've paid. Mm-hmm. All the, you know, we had to replace the well pump. We had to do the roof, right? Like we- Yeah. had to do all these different things, and keeping track of them is depressing. It is. So I, I don't really do that. Um, but I also don't fool myself into thinking I haven't spent additional funds that I wouldn't have spent if I had just been renting, and people don't wanna rent. I understand that. And they don't wanna pay somebody else's mortgage or whatever it might be. It Nothing is all good and all bad. I totally agree. I'll say this last one and, and it's connected to, to what we were talking about, but it's really important in life to be honest with yourself about what it is. Whatever it is. Mm-Hmm. What it is, why it is. Um, and sometimes it takes the r- the deep work and, and starting with why. Um-I think one of my, one of the things I tell people all the time is that it's really important to be risk-aware and not risk-averse, right? So be aware of the risk. Don't hide from it because it might be necessary, right? I feel like too frequently, people are risk-averse and they're being led by fear, they're let, being led by scarcity, right? Totally. You know, the clients that just can't take it anymore and they just want, you know, an annuity or, or whatever it is, just so they have some sort of guarantee in life, but we can talk about what that attachment style might be. Um- But I do think that if you are taking risk, be aware of why you're taking the risk, acknowledge that it is a risk, and then don't hide from it, right? I feel like sometimes We were looking at Tori's 401k yesterday. Mm-hmm. And one of the things that, uh, we saw on there is the word savings. And it said, you know, it, "How much of your savings do you want to allocate to this fund?" Or whatever. And I said, "That's horrible because this is not savings. 401k is investing." It's- Right. you know, it's saving, I suppose, if you just put it in a money market fund and it, it barely keeps up with interest, if that, over the decades that you have a 401k- At best. at Tori's age. Yeah. But, like, it's, it's so misleading and, and then deceitful to treat this like savings. Savings is, you know, in your savings account- Mm-hmm. or in a CD or whatever. Uh, it is not invested in the S&P 500. And savings, theoretically, shouldn't be taking risk, right? There's always risk in the world, it's all around you all day every day, but the type of risk you take with savings is drastically different from what you take with investing. So again, it's just so important to be aware of the risk and also why you're taking the risk. So your rule here is to recognize the risk. Yep. And decide whether or not it's worth it? Yeah. I think that, especially as an investor, it's I guess the number one thing is don't be risk-averse, right? Mm. If, if you're risk-averse, you're losing opportunity, and opportunity cost is real, especially in an inflationary environment. And I think, look, we're in, we are in an inflationary environment. It's not as bad as it was a couple years ago. Mm-hmm. And it could be deflationary in the future with AI, et cetera, but right now it's, we'd spent, like, uh, I don't know how many minutes in the last episode talking about how costs have gone up, right? Right. And costs continue to go up, and the reason that we invest is to keep up with that cost and improve our lifestyle. And there are some clients that get to a point where they don't need to take on risk anymore. Mm-hmm. Right? And then, arguably, maybe they shouldn't. But then they also have to recognize what their FOMO is, right, and when their FOMO is taking hold, because FOMO is a risk itself. Yeah. Well, fear of loss is a, a real thing. Mm-hmm. You know? I, I think a lot of people come in and are so concerned about losing money. And what I find also to be very deceiving about these 401ks and mutual funds or any sort of, I'll say- There's things. funds, or so many things, but, um, the term, like, aggressive investment. Yes. The term aggressive implies the fact that you're taking on a ton of risk. Unne- maybe even unnecessary risk, like- Agreed. a- aggressive, I don't know where we got, like, this Actually, it's from modern all- allocation theory, but, like, this conservative, moderate, aggressive- Mm-hmm. crap that we just kinda latch on. It's just like the ultra-processed foods thing we were talking about, right? Totally. Mountain Dew is not the same as wheat bread, even though they both fall into this ultra-processed food category. And it's, whenever we look for these categorizations or ways to, like, easily explain things, there's some value to that, but there's also a lot of disservice. Mm-hmm. They're not packaged the same. They're Yeah. You could say that they're aggressive because they're stocks, but they're not the same thing. Right. Yeah. Like, if you're just allocating based off of that, it doesn't make It doesn't make any sense inherently. What's wrong with just calling it stocks? Like, here's the stocks fund selection- here are the bonds- Right. here are the mutual funds, here are the target date funds. Well, that's a great, that's a great lesson. Yeah. The fact that, you know Recognize the risk that you're taking- Yeah. and then decide on whether or not it's worth it. Yeah, yeah. It's being, being aware b- there's a risk. Sometimes we are blissfully unaware of the risk- Mm-hmm. um, and sometimes we are dangerously unaware of the risk. And I It's really hard to suss out when is which. Well, yeah. And I think, going back to the house situation, people just think buying a house is a good investment. Right. Because real estate always goes up. Yeah, right. So you gloss over the fact you have property taxes, you have interest, you have basically h- uh, homeowners, then you have all the other maintenance stuff on top of it. And you're missing out on the fact that if you are upping your spending to go into a house, 1, you're not getting any- Yeah. probably much appreciation out of it for years, but then you're missing out on the free cash flow you could be putting aside in other things as well. Absolutely, because the, the return on that investment of the real estate property could be very, very, very below what you would get in the stock market, right? Yeah. Not necessarily, right? There's always You know, this happens to be a year where if you are in a, in a target, you know, 6 2065 fund or 2045 fund or whatever it might be, that, you know, in the first couple of quarters of 2025 you'll have out- outperformed the SMP500 because you actually have some exposure to international funds and international is outperforming this year. Yeah. This is a moment in time where that makes sense. And maybe that moment, like, expands and broadens and, and continues on for some period of time, um, but that doesn't mean that you should just assume this is the right fund for you because it's giving you the best return right now. Yeah. I mean, and that's the thing. It's just, like, blind assumptions all over the place that really That, that, that really just blanket statements I'll, I'll say skew people and lead people down these decision paths- Yep. that aren't in their best interest. Just Uh, I was just looking something up. So if you were to back out the 2021 and 2022 appreciation from real estate, annual appreciation rates averaged, for a single family home, 4%- Yeah. for the rate of return. So you are barely out-beating inflation- in terms of your property appreciation. But then on top of that, when you factor in mortgage interest- Mm-hmm. you are flat to negative. Yeah, and that's not even including insurance. Correct. Right? And that's not including taxes. Right? It's just it's so easy to fool ourselves. And sometimes it's necessary, right? Like, if you believe that stocks will eventually go up and over the long run stocks You know, stocks for the long run, like Jeremy S. Eagle likes to say, and If you believe that, you know, you're best off just being in the SMP500 index for the 40 years of your working career, then, um, you may or may not be correct, but it's pretty easy to just do that. It is. You know? And sometimes you benefit from easy accidents or happy accidents, you know? Yeah. Sometimes easy is most effective. Agreed. Looking back on episode 8, I really enjoyed diving into the beliefs and habits that shape how we approach money, both in our lives and with clients. For me, that life equation is less about rigid budgeting and more about creating space for freedom, joy, and intention. This episode reminded me how personal money is. It's not just about math, it's about values, trade-offs, and having clarity on what great looks like for you. Thanks for listening. If you found this episode valuable, we'd love if you share it with some of your friends. Don't forget to follow or subscribe so you don't miss future episodes of the Compound Growth podcast. Compound Growth with Wheeler and Collin sponsored by Kofi Advisors. Reach out today. Yay!