The Rachel Cruze Show - Why Being Boring is the Best Way to Build Wealth

Starting point is 00:00:05 Do you ever just scroll and see a post and immediately think, like, yes, those are my kind of people. Well, I saw a post the other day, and it just reminded me kind of how boring wealth building can be if you do it the right way. So if it's boring, you're probably doing something right. So make sure to like, subscribe, and share this episode with a friend. All right. So when I was scrolling through, I saw this clip from J.C. Rodriguez, and he goes and interviews people on the street. and I saw this like, and I say this with like mad respect, like a very average looking couple. Like, again, nothing was like superhero about them or whatever.

Starting point is 00:00:44 It's just like they were just a regular couple. They were retired and traveling, but they talked about how they are multimillionaires. So here's the clip. How long have you been married for? 34 years. What are some things you do to be frugal? We're very frugal. That's why we retired at 55 years old.

Starting point is 00:01:01 Did you guys invest in? into like 401k Roth IRA? Max it out. Max out retirement. If the company matches it, you're silly not to. How many years have you been investing now? Since 90.

Starting point is 00:01:12 Are you now net worth millionaires? Yep. And that's the point. You don't have to know about investing. Just invest everything you can into the market. Put it into ETFs, exchange-traded funds, because it goes over the whole market. You don't need to know what you're doing.

Starting point is 00:01:25 Just do that. So you all just invested in boring old index funds. You got it. Hey, you know it. We put our both boys through. college and grad school they have no loans we paid off our houses our cars retired at 55 now we travel so we're just regular people what kind of cars have you been driving throughout these years mostly toyotas because they last forever most of them have been like two year old cars not brand new until recently oh yeah you've come to that point we're now my first fun car last week ask the old lady what her favorite car is now that she just got

Starting point is 00:01:57 how have you now treated yourself i just got a 2023 slingshot i drive it every one And he still didn't need to get it brand new? Two years old? Three thousand miles. Do you not just love them? Like, seriously, when I was watching it, I was like, oh my gosh, I love it. Because it's kind of basic, you guys. It's kind of common sense what they've done.

Starting point is 00:02:16 But they've done the impossible because so many people, you know, they're living paycheck to paycheck. And this idea of investing and paying off debt feels impossible to a lot of people. But you watch someone like that and they've been married for, what, over three decades? They're 55. or I don't know if they are 55 now, they may be even older. They retired at 55 and they were like, don't use debt. Drive Toyotas, right, that are two years or, you know, two years old or even older.

Starting point is 00:02:42 And they invested consistently. Did you hear that? Like, they just invested. And now look at them. They're just doing it. And so I'm pretty positive that maybe they worked the seven baby steps. I don't know. I'd like to think so.

Starting point is 00:02:57 But it's the idea that, man, there is just something about this way of living that is so encouraging and it's not flashy. And I think I'm coming back to this more and more where people that have a level of steadiness where they're not riding on emotion, they're not riding on like the newest, greatest, biggest thing. They just are living their lives, but they are consistent in their principles when it comes to money over the long term. And again, it's not going to happen fast. Over the long term, it works. And so I love the stuff that JC is doing because even some other clips of people, the Ramsey will get brought up sometimes with people that he interviews who are kind of these quiet millionaires and they're ones that we see over and over again.

Starting point is 00:03:37 So you guys, here is how they did it. Here are the seven baby steps. It's pretty simple. But if you live it out, I'm telling you, we have decades and decades of proof that this works for anyone. So the first thing you want to do, the number one step is to get a $1,000 emergency funds. So this is really your starter emergency fund. It's kind of that small little safety net between you and life. and then everything else you have, any other savings, any other investments that are non-retirement,

Starting point is 00:04:02 cash everything out, and put it towards your debt. Get all of your debt paid off. So you're going to do that by paying off the smallest debt to the largest debt, pay minimum payments on everything, and pay off the smallest debt first. Because the power of knowing that your income, when you make money, is not going back out eight different directions to other people. You get to keep your income when you're debt-free, and your income is what's going to help you build well. So the faster you can keep your income, the better off you're going to be long term. So once all of your debt is paid off, and then you can go to Babysept 3, which is you're going to bump up that starter emergency fund up to three to six months of expenses. And this is your fully funded emergency funds.

Starting point is 00:04:39 So you're going to have cash sitting in the bank. It can be in a high-yield savings account, but it is there for you. Now, once those are done, you're going to move on to four, five, and six. So Babyset 4 is funding 15% of your income into retirement. And this is what these guys were talking about earlier in the real. Now, I will say when he was like, you don't even have to understand it. Just put your money in. I do want you to understand what you're investing in.

Starting point is 00:05:01 He does in a very important part of this because if you sit down with a financial advisor, maybe one who's not great, and they're like, here, do this, do that. And you just like, sure, okay, you can get into a bad deal. Okay, so you always want to make sure that you understand what you're investing in. But the power of investing and investing early is incredible. And you can use the Ramsey investment calculator just to put in some numbers. It's always pretty fun. So if you look at it, and let's just say you save $300 a month starting at age 25, well,

Starting point is 00:05:29 with an average rate of return of around 10%, you'll have almost $1.9 million by the age of 65. Wow. And that doesn't even include, you know, if you put it into a 401k and your company matches or your salary increases so you end up saving more, it's wild. Now, let's say you're a little bit later to the game and you're investing at 45 years old. but maybe you put a little bit more in. So maybe you contribute $1,000 a month, which may sound like a lot, but remember, if you have no debt and a salary that's $80,000,

Starting point is 00:06:00 15% of that is $1,000. So let's say you put that in. By age 68, you'll have over a million dollars in retirement. So it's never too early or too late to do this, but this is the power of investing that I love. Now, a lot of people think that investing is kind of that final goal, but it's not because there are three more steps, But before we dive into those, I do want to tell you about our sponsor, Delete Me.

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Starting point is 00:07:07 All right. So we're going to be investing 15% of our income into retirement. Next, you're going to save for kids college, just like what they were talking about if you have kids. So you can use a $529 for this. You can use an ESA, whatever it is. but be saving for the future because a beautiful part of working all of these steps is it's not just for you, but it really is to change your family's tree. And if you're able to help your kids financially get off on the right foot versus in a financial hole, that means they're going to be off to the races

Starting point is 00:07:33 faster and earlier so that they can do their own investing like we were just talking about. So once you put some money away for kids college, then any extra money you have, you're going to put it towards your house to pay it off early. So once kids college is good, house is paid off, then you move on to Baby Step 7. And that is where you can live and give like no one else. So you continue to invest, but also your generosity can really, like, you can go crazy with it because you have no payments. So it is an incredible thing that happens. But all of this is just a pretty simple plan to get you to where you want to go.

Starting point is 00:08:09 But no matter where you're starting with the Baby Steps, if you need a tool to help you when it comes to tracking your money milestones, check out every dollar. It's an incredible app. It helps you with budgeting and your overall financial picture. So make sure to check that out. And investing in retirement is one of those crucial steps to get that financial piece long term. But people do get it wrong. So make sure to check out the episode, How to Invest the Right Way in 2025, so you don't make some of these common mistakes. You can click here to watch that.

Starting point is 00:08:38 Or I'll leave a link below if you're listening on podcast. All right, you guys, remember to take control of your money and create a life you love.

The Rachel Cruze Show - Why Being Boring is the Best Way to Build Wealth

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