Podcast Episode

Hack Your Wealth

Healthcare planning = retirement planning

Jun 06, 2023 Episode 95

Andrew Chen

#95: The biggest concern many would-be retirees have, at least in the US, is the cost of healthcare.

Not only is healthcare more expensive in the US than in every other industrialized country. There’s also no national health insurance system to control costs or standardize care quality…unless you’re a senior or very poor (or both).

In fact, were it not for worries about healthcare, there would undoubtedly be way more US retirees out there today. The average retirement age would drop noticeably.

Because no less than your retirement security is at stake, healthcare financial planning is retirement planning.

That’s why I invited Bo Bowen to the podcast today to share his unique perspective on healthcare financial planning in retirement. Bo is both a healthcare practitioner (pharmacist) and a certified financial advisor who has specialized in advising on healthcare financial planning and retirement health insurance. His dual background gives him unique insight into the way healthcare financial planning is crucial for retirement security.

We discuss:

The biggest challenges retirees face when it comes to healthcare planning
What retirees should think carefully about when it comes to health insurance in retirement
How those considerations change depending on your retirement age
Checklist for choosing the right health insurance plan if you’re retiring soon
Common mistakes retirees make when planning for post-retirement healthcare
When self-insuring might be your best choice in retirement
How medical tourism can play an important role in retirement healthcare
What retirees should know about buying health insurance on ACA marketplace exchanges

Check it out here:

https://hackyourwealth.com/health-insurance-retirement-planning

If you’ve already retired, what do you do for health insurance? Knowing what you know now, what (if anything) would you do differently in terms of healthcare planning in the years before retiring?

If you have NOT retired yet, how big of a factor is healthcare and health insurance to your decision of when to retire?

Let me know by leaving a comment.

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Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

Real estate investing in short-term rentals and hotels

Apr 04, 2023 Episode 94

Andrew Chen

#94: Real estate investing changed a lot the last couple years, but one asset class consistently punched above its weight: short-term rentals, a.k.a., STRs, e.g., Airbnbs.

In 2020, when people couldn’t go on vacation by hopping on a plane to Europe, South America, or Asia, they got in their cars and drove to national parks and mountain / beach / lake towns. Short-term rentals, often seen as safer than hotels, were on 🔥.

In 2021, this trend exploded. 🔥🔥

In 2022, when flying became a thing again, so did “revenge travel.” STRs accelerated even more. 🔥🔥🔥

With average daily rates skyrocketing the last couple years, hordes of real estate investors snapped up homes to turn them into Airbnbs, trying to chase yield.

Now the market is super saturated, with daily rates even contracting in places, and there’s tons of new short-term rental inventory (over half of Airbnb listings added since 2020).

So how can you stand out as an STR real estate investor in the current climate?

In this episode, I interview Diya Liu, a seasoned short-term rental investor who scaled from zero to 9 STRs in one year, netting $100k annual profit, and then quit her BigLaw job to do short-term rental real estate investing full-time. She currently owns three hotels and a dozen STRs.

We discuss:

Diya’s RE portfolio breakdown - STRs vs. hotels
Her step-by-step analysis process for screening potential STR vs. hotel deals
How she analyzes local STR regulations in a market
Key interior design principles she implements for her STRs
Marketing strategies to help your STR stand out
Automation strategies for your STRs - using VAs, messaging guests, etc
How she met her investment partners and how they split up work

Check it out here:

https://hackyourwealth.com/short-term-rental-hotel-investing

Are you an STR investor? If so, how have bookings changed in the last 1-2 years? Do you see over-saturation in listings inventory in your area? Are you trying out any different strategies this year? Let me know by leaving a comment.

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Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

Health insurance for traveling early retirees

Nov 22, 2022 Episode 93

Andrew Chen

#93: Early retirees often fill their early years in retirement with lots of travel. There is even a vibrant community of nomadic early retirees who travel long-term.

But what do you do about health insurance, especially if you’re American? Unlike in most other industrialized countries that have universal health insurance, American health insurance is generally tied to your employer, at least before you’re old enough to qualify for Medicare. That means if you don’t have a job, you generally don’t have health insurance. For early retirees, that’s a problem.

What are the health insurance options for early retirees, especially those who plan to travel significantly in retirement?

This week, I chat about early retirement health insurance options with Tracy Winters, Director of Individual Insurance at Good Neighbor Insurance, an Arizona-based health insurance brokerage that specializes in health insurance consulting for long-term travelers, expats, and traveling early retirees.

We discuss:

The big picture for how traveling early retirees should think about their health insurance options
When it makes sense to simply self-insure
Tracy’s observations on which countries offer both high-quality and affordable healthcare
Tracy’s health insurance recommendations for early retirees who wish to travel abroad 100% vs. 90% vs. 50% vs. 25% of the time
ACA marketplace health insurance options to consider for early retirees
How Medicare coverage is impacted when you travel long-term
When it’s worth repatriating to the US vs. staying in-country to get medical care, plus what kind of insurance plans provide repatriation services

Check it out here:

https://hackyourwealth.com/health-insurance-retirement-travel

If you’re early retired, what do you do for health insurance?

How do you handle health insurance when traveling as an early retiree?

If you’re planning to early retire in the future, how important is health insurance coverage to your decision of timing when to early retiree?

Let me know by leaving a comment.

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Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

How a female MBA early retired at 39 (+ her advice for women pursuing FIRE)

Oct 18, 2022 Episode 92

Andrew Chen

#92: Most FIRE stories are of men. A lot seem to be of ex-software engineers (on blogs anyway). It’s rare to see profiles of early retired women, especially single women who retired early from ambitious careers.

Also, most FIRE stories focus on strategies for things like accumulating enough assets to FIRE. Investment selection. Portfolio allocation. Safe withdrawal rates. Sequence risk.

These are important topics for sure. I’ve covered many of them on HYW. But they are also very much about the mechanics.

It’s rare to hear how early retirees grapple with stuff like: loss of professional identity, building a new non-career identity, finding purpose, fulfillment, and community as an early retiree; or dating and companionship in early retirement.

This week, I chat with Kim (last name withheld at her request) about her journey from MBA to corporate career to early retirement at 39 and her life and identity now 5 years post-FIRE. We discuss some of these rarely mentioned topics, as well as what it’s been like so far in early retirement as a single woman.

We talk about:

Kim’s career path before early retirement
How she came up with her FIRE number
Her numbers: earning/income trajectory from MBA graduation to early retirement, spending level during her career & now in retirement
Her asset allocation + tactics she uses for managing, rebalancing, risk mitigation, and withdrawing from her portfolio
Factors she considered in terms of spouse/family vs. early retirement
Advice on dating and companionship in early retirement
What she learned about finding a new non-career identity, purpose, and fulfillment in early retirement
How Kim spends her days now & how she’s found community as an early retiree
Her advice for other young women who are interested in FIRE

Check it out here:

https://hackyourwealth.com/retire-early-women-business-career-professional

Know any other interesting unmarried women who are pursuing or achieved FIRE? I’d be interested in potentially interviewing them for the podcast. Let me know by leaving a comment.

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Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

Financial independence in healthcare: how a dentist built a $7M nest egg

Sep 20, 2022 Episode 91

Andrew Chen

#91: It’s no secret that many healthcare professionals earn lots of money. So, you might think it’s relatively easy for them to achieve financial independence and retire early (or at least step back from demanding clinical hours).

Aaaand….you’d be right about that!

Sure, earning healthcare money is not a requirement for FIRE. But if you do, you certainly have more options…even if you also have large expenses (like kids).

This week, I talk with Dr. G (anonymized, his request), a dentist with two kids in the midwest who built a $7 million nest egg before stepping back from clinical practice. He explains the actions he took to build his wealth…and what he’s doing now.

We discuss:

His career path as a dentist
Net worth after finishing dental school
Age when he broke even and when he reached FI
How much he earned right out of dental school, when he broke even, when he reached FI, plus how much he earns passively now
Spending level over the years, plus how much he spends post-FI
Asset allocation breakdown
Main actions he took that had the biggest impact on net worth
His thought process on stepping back from clinical work with two young kids still in tow
FIRE tips for people with kids

Check it out here:

https://hackyourwealth.com/dentist-financial-independence-retire-early

What type of FIRE profiles (career path, earning level, family/kid status, etc) do you want to hear more about? Let me know by leaving a comment.

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Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

How to pay for college

Aug 23, 2022 Episode 90

Andrew Chen

#90: It’s back to school season, and that means it’s also the time of year for high school seniors to start agonizing over college applications.

Applying to college is an anxiety-filled rite of passage for high school seniors, but it’s often just as anxiety-inducing for parents who bang their heads on how to pay for it.

That’s because paying for college is, for many families, the biggest single expense they’ll have for their child. It’s also often the second biggest life expense a family will incur, right behind buying a home. Paying for college is like buying a Tesla Model Y and giving it away. Every year, for four years.

So this week, I chat with my friend Ann Garcia about how to pay for college. She just wrote a new book on this topic, which we discuss in detail, along with important new updates to the federal financial aid process (FAFSA) + key things to know about 529 plan rules.

We discuss:

Why Ann decided to write this book now, what makes it different
The mind-boggling cost of college today; forecasted cost in 15 years
Why college costs so much now, what’s driven up the cost in recent decades
Goals that colleges are trying to accomplish with their financial aid awards
Things parents should do to prepare their child and finances for the cost of college from birth to high school
Why it’s important for your child to do the official campus tour for colleges they’re interested in
Recent key changes and updates to the FAFSA process
Difference between 529 savings plans vs. pre-paid tuition plans vs. Private College 529
Mechanics of 529s: roll-over-ability, qualified expenses, taxes & penalties for non-qualified expenses, how scholarships are handled, changing beneficiaries

Check it out here:

https://hackyourwealth.com/how-to-pay-for-college

Have you been through (or will soon go through) the college financial aid process? What’s been the most confusing or frustrating aspect? Let me know by leaving a comment.

Don't miss an episode, hit that subscribe button...

If you liked this episode, be sure to subscribe so you don’t miss any upcoming episodes!

I need your help, please leave a listener review :)

If you liked this episode, would you please leave a quick review on Apple Podcasts? It’d mean the world to me and your review also helps others find my podcast, too!

Related links:

Book: How to Pay for College: A complete financial plan for funding your child's education
Online course: The College Financial Plan Masterclass - 20% discount exclusively for HYW subscribers (use code: HYW20)
TheCollegeFinancialLady.com
529 college savings plans: rules, tax benefits, & qualified expenses (HYW026)
College financial aid tips and strategies, with Ann Garcia (HYW053)
College student financial aid changes coming to the FAFSA application (HYW079)
Schedule a private 1:1 consult with me
HYW private FB community

Intro/Outro: Old Bossa by Twin Mus

Hack Your Wealth

How to do real estate due diligence when buying a home

May 03, 2022 Episode 89

Andrew Chen

#89: Summer is fast approaching, and that’s traditionally when home-buying season ramps up.

This week, I share insights on how to conduct due diligence when you’re looking to buy a home. Whether you’re buying a primary residence or investing in rental real estate, rigorous due diligence is critical to ensuring you get a good property at a reasonable price. In this episode, I explain my entire process for thoroughly analyzing a property before writing an offer.

You learn:

10 key things to look for when doing pre-tour due diligence
The 4 big things to look for in disclosure packets
How to evaluate the history of previous remodels, structural changes, or additions to the house done by prior owners
Special tips for buying a condo – how to analyze HOA records, financials, rules, and CC&Rs
My 12-point checklist on what to look for when touring a home in person

Check it out here:

https://hackyourwealth.com/real-estate-due-diligence

If you’ve bought a home before, what are the most important due diligence items you look for? Let me know by leaving a comment.

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If you liked this episode, be sure to subscribe so you don’t miss any upcoming episodes!

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Related links:

Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

Mega Backdoor Roth

Apr 05, 2022 Episode 88

Andrew Chen

#88: Have you maxed out your backdoor + mega backdoor Roth conversions yet?

For high earners, direct contributions to a Roth IRA, and tax-deductible contributions to a traditional IRA, are limited by income thresholds.

But ALL taxpayers – even high earners – can still invest money into a Roth via backdoor Roth conversion. And if your employer’s 401k has the right plan features, you can turbo-charge your Roth conversions another 7x by doing the “mega backdoor” Roth conversion.

What the heck do these mean? And how exactly do you do them?

This week, I share what these concepts are, tips for how to execute them successfully, and what you need to know about your employer 401k to turbo-charge your Roth conversions.

I explain:

The difference between a backdoor Roth vs. mega backdoor Roth
How to execute each one + tips to ensure no tax liability when you convert
What plan features your employer 401k must have to do a mega backdoor Roth
Workaround if your employer 401k does NOT allow in-plan Roth conversions, but DOES allow after-tax contributions (yes, you can still move that money into Roth)
How recent proposed legislative changes would curtail the backdoor Roth strategy, and whether you need to worry about it
A note about doing mega backdoor Roth conversions via Solo 401k.

Check it out here:

https://hackyourwealth.com/mega-backdoor-roth

Have you done a backdoor or mega backdoor Roth conversion before? If you’ve decided not to, what dissuaded you? Let me know by leaving a comment.

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Related links:

Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

How the future of (remote) work is changing

Mar 08, 2022 Episode 87

Andrew Chen

#87: Remote work and digital nomadism have always been of particular interest to folks in the FIRE community.

After the pandemic, remote work was suddenly thrust upon the entire knowledge workforce. And after two long pandemic years, the possibility that remote work for many professions will persist and become long-term viable options is tantalizingly close.

What is the state of remote work right now? Where is the future of remote work headed? What jobs are most in-demand for remote work, and how much can you get paid for them?

This week, I deep dive on these questions with Sharon Koifman, founder of DistantJob, a remote-only recruiting agency that helps companies find full-time remote employees around the world.

We discuss:

How Sharon became an advocate for remote work and got into remote recruiting
How the pandemic changed norms around remote work
What types of jobs are most in-demand for remote work right now
What types of jobs still have not embraced remote work
Skills and qualities employers look for when hiring remote employees (profile of an ideal candidate)
Compensation: what remote employees can earn for certain roles (including pay range - min and max)
How companies adjust compensation for remote employees
How companies can promote strong, healthy remote work cultures

Check it out here:

https://hackyourwealth.com/future-of-remote-work

And now, I’m super curious…. Are you a remote worker or digital nomad? Trying to be? Wish to be? If so, what type of work do you do?

If you work remotely for a company, was your compensation adjusted when you switched to remote?

What’s the biggest benefit vs. challenge you have experienced as a remote worker? How do you build (and keep) strong connections to people in your company/organization?

Does being able to be remote change your FIRE plans, timeline, or philosophy at all?

Let me know by leaving a comment!

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Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

Why the 4% rule doesn’t work anymore

Feb 08, 2022 Episode 86

Andrew Chen

#86: Pretty much everyone in the FIRE community has heard of the 4% rule.

It is the starting safe withdrawal rate number for a 30-year retirement horizon that was proposed a few decades ago by retirement researchers.

And it has attained near pop culture status in the FIRE community because it’s such a simple mental shortcut to answer the question: “how much can I safely withdraw from my portfolio each year in retirement and have high confidence that I’ll be financially secure for the rest of my life?”

This is easily the most important question for ANY retiree, and especially early retirees. So, it’s no wonder this topic is so intensely discussed in the FIRE community.

More than a few early retirees and FIRE bloggers swear by the 4% rule and have plunged into their own retirement using this withdrawal rate expecting that it will carry them through for the rest of their lives.

But when you ask the quants – the economists with the PhDs – there is broad agreement that the 4% rule no longer works most of the time.

But why not?

This week, I invited the renowned retirement economist Wade Pfau, PhD/CFA, who is Co-Director of the American College Center for Retirement Income, to share insight on why the 4% rule no longer works in today’s environment. He suggests an alternate safe withdrawal rate number that may be better suited for today’s retirees.

We discuss:

Why Dr. Pfau thinks the 4% rule is flawed today + how the world has changed since the 4% rule was first proposed
Pfau’s recommended safe withdrawal rate number for the current environment (including assumed asset allocation)
How Pfau thinks safe withdrawal rate planning will differ for early retirees
Pfau’s thoughts on asset allocation in the current environment of rising interest rates, high inflation, and high asset valuations
What Pfau personally projects as his assumed real rate of return on stocks for his own portfolio
How annuities can play a crucial role in your retirement portfolio depending on your investor risk profile and desired stock allocation
Pfau’s framework of 4 retirement styles + optimal asset allocation for each

Check it out here:

https://hackyourwealth.com/4-percent-rule

What do you think your safe withdrawal rate number is? And what asset allocation do you assume for that? Let me know by leaving a comment.

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Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

How current economic changes impact retirement safe withdrawal rates

Jan 11, 2022 Episode 85

Andrew Chen

#85: Recently I’ve really started to notice the impact of inflation on daily spending. Have you?

At first, it was just 1-2 things. Then it was a handful. Now it seems like everything is noticeably more expensive. (Assuming it’s even in stock in the first place.)

Gas. Groceries. Takeout. Toiletries. Utilities. Car maintenance. Healthcare/supplies. Pre-school. Appliances.

Everything seems to cost more and you just can’t buy as much with the same budget anymore.

This got me wondering about how recent macroeconomic changes over the last 6 months might impact retirement safe withdrawal rates and asset allocations.

The macro changes I’m referring to are: Inflation at a 40-year high. Stock valuations doubling since their pandemic lows. Interest rates that are scheduled to increase a minimum of 3 times this year.

In these times, what should investors and retirees be doing to defend their portfolio values and retirement security?

This week, I asked my friend Karsten Jeske (aka “Big ERN”) to help us make sense of all that is going on right now in terms of macro trends…and what it all means for safe withdrawal rates and asset allocation. We had a wide-ranging, nearly 2-hour(!) discussion full of insights and tips that you won’t want to miss.

We discuss:

Major recent macroeconomic changes that (early) retirees may want to factor into their retirement planning
What new safe withdrawal rate % retirees should consider right now
Whether investors should potentially update their asset allocation given current macro trends
Whether he believes asset prices are overvalued right now
Alternative assets (like cryptocurrencies) and their merits / concerns
How much cash he believes is advisable to hold right now

Do you plan to make changes to your asset allocation or safe withdrawal rate in light of recent macroeconomic changes? Let me know by leaving a comment!

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Links mentioned in this episode:

Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

REPLAY: How to set and rebalance your asset allocation efficiently

Dec 27, 2021 Episode 84

Andrew Chen

#84: Today's episode is about an important end-of-year planning topic: asset allocation and portfolio rebalancing.

Many otherwise smart investors set their portfolio once, but then fail to rigorously monitor their asset allocation and rebalance regularly.

Whether due to inertia or hassle, this inaction is costly. It results in lower returns and greater risk as your asset allocation drifts…bad for wealth-building.

How do you set your target asset allocation optimally and rigorously? And how do you rebalance tax-efficiently?

This week, I show you how to set your target asset allocation to match your risk profile and investment goals. I share how to track your asset allocation to see how much it has drifted from your target allocation. And I explain step-by-step how to tax-efficiently rebalance.

If asset allocation and rebalancing feel like a mystery or chore, then don’t miss today’s episode. I’ll show you how to do it systematically, efficiently, and rigorously…all in 1 hour or less per year.

What you’ll learn:

Why it’s prudent to sell your winning investments and rebalance toward your underdogs
How to create and define your target asset allocation starting from first principles
How to determine your investment style and risk tolerance in an intellectually honest way
How to track your current allocation and analyze drift from your target
How to rebalance your portfolio tax-efficiently step-by-step
How often you should rebalance

Check it out here:

https://hackyourwealth.com/asset-allocation-rebalance-portfolio-replay

How often do you rebalance your portfolio? Let me know by leaving a comment!

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Links mentioned in this episode:

Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

Retirement withdrawal strategies: tax-efficient portfolio drawdowns

Nov 02, 2021 Episode 83

Andrew Chen

#83: You’ve worked hard all your life. At retirement, it’s time to kick back and relax, right?

Not so fast.

You still have to get THROUGH retirement.

That means knowing how to draw down your portfolio to:

meet all your monthly cash flow needs
cushion against unexpected expenses
minimize tax liability
ideally help your kids / grandkids, give to charity, or leave a legacy
ensure your retirement nut doesn’t run out before you do

This is very challenging because you have to forecast things you simply can’t know with certainty. Inflation rates. Market returns. Sequence risk. Tax rates. Your health condition and anticipated healthcare needs.

So, how can retirees plan their retirement portfolio withdrawals to actually enjoy retirement and not worry about running out of money?

This week, I sit down with Steve Parrish, Co-Director of the Center for Retirement Income at The American College of Financial Services, to talk about tax-efficient portfolio withdrawal strategies in retirement.

We discuss:

Key principles retirees should understand when deciding which assets to draw down and in what sequence
How those principles change when you have alternate monthly income sources (like rental real estate, pension, etc)
Why your wealth bracket determines what is the most tax-efficient sequence of portfolio withdrawals
How soon-to-be and current retirees can protect themselves against sequence of returns risk
When it makes sense to use legal tools like tax-free gifts, GRATs, etc, to reduce tax liability on retirement assets
Why you might want to pay taxes now to do annual Roth conversions to ratchet down your IRA/401ks and the ticking tax time bomb attached to them
Portfolio withdrawal advice for early retirees (FIRE)

Check it out here:

https://hackyourwealth.com/retirement-withdrawal-strategies

Do you worry about running out of money in retirement? If so, what is the biggest reason why – not saving enough, spending too fast, market tanks during retirement, something else? Let me know by leaving a comment.

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Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

Annuities explained: are annuities a good investment for retirement?

Oct 19, 2021 Episode 82

Andrew Chen

#82: Are annuities a good investment for retirement?

With $250 billion in sales each year, and $2.5 trillion in retirement annuity assets under contract, annuities comprise a huge slice of US retirement assets.

Understanding annuities – whether annuities are right for you, and how annuities fit into your retirement strategy – can get complicated given all the annuity options out there and the extreme uncertainty in today’s markets.

So this week, I sat down with Stan Haithcock, aka “Stan The Annuity Man,” to deep dive on annuities. We chat about how annuities work, why annuities are not investments (in the portfolio sense), and why there is no such thing as “best annuities.”

We discuss:

What annuities are and what purpose they serve
The different types of annuity options (immediate annuity, deferred annuity, fixed annuity, variable annuity, indexed annuity, multi-year guaranteed annuity, life annuity)
How annuities account for inflation
The mechanics of how to buy an annuity
How insurance companies that sell annuities make money
The different type of annuity fees you can expect, and typical all-in costs for different annuity types
How to vet the insurance companies that sell annuities
How to vet an agent and questions to ask before buying an annuity from them
How agents who sell annuities are compensated
Annuity taxes and the tax profile of annuities
Basic protections your annuity gets if the insurance company you bought it from goes bankrupt
Who annuities are best suited for, and whether annuities are a good idea for early retirees (FIRE)

Check it out here:

https://hackyourwealth.com/annuities

Have you purchased any annuities before, either for yourself or a family member? What kind of annuity did you buy, and why? Let me know by leaving a comment.

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If you liked this episode, be sure to subscribe so you don’t miss any upcoming episodes!

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Links mentioned in this episode:

Intro/Outro: Old Bossa by Twin Musicom.

Hack Your Wealth

Taxes on stock gains: how to avoid capital gains tax on stocks

Oct 05, 2021 Episode 81

Andrew Chen

#81: With the market rallying like crazy this past year, you might have significant capital gains on stocks right now.

Now might be a good time for some of you investors to harvest some capital gains. Maybe you’re looking to buy a house. Or maybe you just want to rebalance your investments.

But when you sell stock, you pay taxes on the sale.

And capital gains taxes can get complex because the effective tax rate you pay when you sell stock depends on whether there are long-term vs. short-term capital gains, whether there are any long-term vs. short-term losses, what your marginal tax rate is, and even whether you are required to pay the Medicare Surcharge Tax.

That’s why this week I invited CFA Scott Stratton to explain the intricacies of how capital gains taxes work. We discuss key rules and strategies you need to know to do thoughtful capital gains tax planning. If you want to learn how to minimize capital gains taxes, then don’t miss this episode.

You’ll learn:

What types of assets capital gains taxes apply to
Difference between short-term vs. long-term capital gains tax treatment
How capital gains and losses work in tandem come tax filing time
How to harvest capital losses and harvest capital gains
Current proposed legislative changes to capital gains tax rates
What investors may want to consider doing now before potential changes take effect

Check it out here:

https://hackyourwealth.com/capital-gains-tax-on-stocks

What other tax planning questions do you have about capital gains taxes? Let me know by leaving a comment.

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Hack Your Wealth

Teaching your kids about money and financial independence

Sep 21, 2021 Episode 80

Andrew Chen

#80: Teaching kids about money isn’t easy, but it’s crucial if you want to boot them off your payroll after they graduate from school.

But while financial literacy is good, helping your kids build the mindset and momentum to achieve financial independence is even better.

It requires that they internalize (and value) aggressive saving, investing, and compounding…not just living within their means.

That’s why I was so excited to chat this week with Doug Nordman and Carol Pittner, father and daughter co-authors of a new book on how to teach next-generation financial independence.

We discuss:

Why it’s important to let kids make their own financial choices (and mistakes) when the stakes are low
Why letting your kids buy “One Special Thing” per shopping trip is an effective teaching strategy
Why you might want to pay your kids for jobs, but not chores…and the difference between the two
Why it might not be a good idea to pay your kids for getting good grades, and what you can do instead
Why “profit sharing” is an especially powerful strategy to teach kids about savings and frugality
How to create a “kid 401k” to teach your kid lasting lessons about compounding and long-term investing
How to incentivize your kid to contribute to a Roth IRA early on
How to handle the question of “how rich are we?”

Check it out here:

https://hackyourwealth.com/teaching-kids-about-money-financial-independence

What strategies do you use to teach your kids about saving, investing, and compounding? How are you helping them learn about financial independence, if at all? Let me know by leaving a comment.

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Hack Your Wealth

College student financial aid changes coming to the FAFSA application

Sep 07, 2021 Episode 79

Andrew Chen

#79: This one’s for you parents who have kids in college or soon going to college…

In the COVID relief stimulus bill that passed at the end of 2020, there was a big chunk about federal student financial aid.

New rules are bringing significant changes to college financial aid. This week, I deep dive with my friend Ann Garcia, aka The College Financial Lady, on what these changes are and how they will impact you and your family.

We discuss:

Overview of the federal student financial aid application process, including key dates
Important changes coming to the federal financial aid process: for the FAFSA application, families with multiple college-aged kids, grandparent 529 plans, divorced parents, and more
Timeline and phasing of these changes coming in 2021, 2022, 2023 and beyond

Check it out here:

https://hackyourwealth.com/fafsa-federal-student-financial-aid-changes

Will you be applying for college financial aid over the next few years? What one thing brings you the biggest worry when it comes to college financial aid? Let me know by leaving a comment.

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Hack Your Wealth

Money lessons for kids: Tips from other personal finance influencers

Aug 24, 2021 Episode 78

Andrew Chen

#78: For this episode, I polled other influencers in the personal finance community to ask for their best tip on teaching money lessons to kids.

I had four different personal finance influencers weigh in – a range of bloggers, podcasters, authors, and community admins. All of them are parents themselves.

I asked each person to answer one simple question:

“When it comes to teaching your kids about money, what single method or strategy have you personally found to be most effective?”

Check out their collective tips here:

https://hackyourwealth.com/money-lessons-for-kids-tips-from-personal-finance-influencers

What strategy have YOU found to be most effective when it comes to teaching your kids about money? Let me know by leaving a comment.

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Hack Your Wealth

Financial literacy for kids: how to teach your kids about money

Aug 10, 2021 Episode 77

Andrew Chen

#77: Teaching financial literacy for kids may seem like a tall order…when considering that financial literacy even for adults is a national deficiency.

But teaching kids about money is crucial if you want your kids to grow up financially responsible and independent.

As a parent, you will have a strong vested interest in it, because if you fail at it you’ll eventually pay the consequences (literally), e.g., if your adult kid can’t support themselves and move out of the house.

And early retirement? You can probably kiss that goodbye if your kid is financially reckless.

So, instilling good financial education for your kids is a wise investment…maybe even the wisest investment.

This week, I spoke with Robin Taub, author of the book “The Wisest Investment,” about how to instill financial literacy for children. We discuss strategies, role modeling, and techniques for teaching personal finance and money lessons to your kids.

What you’ll learn:

Why teaching kids about money is hard
What financially well-educated kids have in common
The right age to start teaching kids about money in earnest
The crucial money lessons kids at each maturity level should know to have healthy skills, habits, and mindsets about money
Robin’s core framework for teaching kids about money
Common mistakes parents make when teaching their kids about money, and the most effective role modeling parents can do to successfully teach their kids about money
How to get kids to become self-motivated to learn about money, saving, investing, and budgeting
How parents can create teachable moments in daily life and turn them into money lessons for their kids
How to answer awkward questions like “how rich are we” and “how much money does our family make”
How parents can help teach their kids to embrace impulse control and delayed gratification when it comes to money
Guidelines for paying kids an allowance or paying kids to do chores
How to teach kids about budgeting (and when it’s age appropriate)
For affluent families: how to make sure your kids don’t take money for granted or become spoiled entitled brats

What methods have you found to be effective when it comes to teaching your kids about money? If your kids are self-motivated to learn about personal finance – earning, budgeting, saving, investing – how did you get them to be self-motivated? Let me know by leaving a comment.

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Hack Your Wealth

Language learning through travel immersion courses in early retirement

Jul 27, 2021 Episode 76

Andrew Chen

#76: Retiring early to travel the world is a common goal for FIRE aspirants.

But full-time travel can lose appeal quickly. Churches and temples quickly start to look the same. Gardens and palaces quickly look the same.

When you’re responsible for creating all the structure to your day – every day for weeks and months on end – it gets exhausting and can feel purposeless.

But what if you could design early retirement travel around language learning?

By enrolling in language immersion courses at local language schools in countries you travel to, you not only learn how to communicate conversationally with locals. You also get structured and even vibrant exposure to local culture, food, people, and activities because being situated in a school or university environment creates that exposure and structure for you naturally.

This week, I invited Ingrid, a software engineer turned early retiree and successful travel blogger, to share about her early retirement experience pursuing language learning through travel immersion courses. Making language learning the focus of early retirement has brought joy and purpose and structure to her travel experiences.

We discuss:

How Ingrid came up with and built strong confidence in her FIRE number
Her asset allocation and withdrawal rate
Her blog’s revenue contribution (and what helped her blog get traction)
How Ingrid plans travel around language immersion courses
How she meets and connects with locals when she travels, plus her advice for solo female travelers
How she handles health insurance and healthcare costs as an early retiree and when she’s traveling
How she believes one’s emotional well being and personality change in early retirement
How she contemplated family and children alongside her early retirement plan, why she decided against having a family, and her thoughts on loneliness, dating, and companionship as an early retiree
What Ingrid would have done differently if she could do it over again

Check it out here:

https://hackyourwealth.com/language-learning-courses-retirement-travel-immersion

Have you ever studied abroad or taken a language immersion course in another country? What do you think about the notion of pursuing language learning through travel immersion courses in early retirement? Let me know by leaving a comment!

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Hack Your Wealth

How this middle income couple built a real estate portfolio of 25 doors (in expensive California!)

Jul 13, 2021 Episode 75

Andrew Chen

#75: Real estate investing might seem like something only wealthy people can do.

It’s expensive, down payments can be high, and you may feel you don’t have enough income to afford it.

Maybe you think: “I can’t even afford a house to LIVE in…how would I afford a house to invest in?”

But the plain truth is: there are lots of average Joes who do it…and who build a lot of wealth from it!

Today’s podcast guest is one such (inspiring) example.

John and Rosalina Steiner reached out to me (after following the podcast!) to share their real estate investing story. I found it compelling and wanted to share their insights and wisdom with you, too. Hope you enjoy listening to their story as much as I did!

We chat about:

How and why the Steiners started investing in real estate in the first place
Their 25-door real estate portfolio breakdown – what type of units, where they’re located, how many have mortgages
How they financed the down payments and loans for each property
Why they chose the neighborhoods they invest in
Why they self-manage, and their best tips for managing tenants effectively
Their views on Section 8 and how they manage Section 8 tenants
Why they never plan to stop investing…even though they’re 65!

Check it out here:

https://hackyourwealth.com/real-estate-investing-with-middle-class-income

Do you wish to invest in real estate but feel like you don’t know how to get started? What’s the biggest factor you think holding you back? Let me know by leaving a comment.

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Hack Your Wealth

How to early retire (FIRE) if your spouse isn’t on board

Jun 29, 2021 Episode 74

Andrew Chen

#74: This week, I chat with Caroline Ceniza-Levine, a career coach now early retired, whose own spouse wasn’t on board with early retirement for many years before she finally convinced him to get on the FIRE train.

We talk about tips and advice for how to convince your spouse about early retirement – and all it entails...

We discuss:

Caroline’s own path to FIRE – from music, to strategy consulting, to corporate, to coaching, to FIRE
Her spouse’s main concerns when it came to early retirement
How she got her spouse on board, what she would have done differently, and her advice for others who are struggling to convince their partner about early retirement
Plus: how Caroline handles healthcare / insurance as an early (pre-Medicare) retiree, her passive rental real estate portfolio breakdown and how she manages her rentals remotely

Check it out here:

https://hackyourwealth.com/retire-early-with-spouse-working

Have you ever been at odds with your spouse about early retirement? What were their main concerns? Were you able to change their mind – how? Let me know by leaving a comment.

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Hack Your Wealth

Stock option and RSU tax planning

Jun 15, 2021 Episode 73

Andrew Chen

#73: One big reason the tech industry attracts a lot of talent: you get partly compensated in stock, and if you’re early enough at a company that IPOs, your stock options or RSUs can make you a millionaire multiple times over when the company goes public.

Google created >1000 millionaires at IPO. Facebook too. Microsoft has created >10k millionaires. Amazon probably even more.

But with stock compensation, your taxes can quickly get complicated. You need thoughtful tax planning to make sure you don’t pay more in taxes than needed. As with other types of income, what matters isn’t what you earn – it’s what you keep.

So this week, I spoke with Shane Mason, whose CPA firm specializes in advising entrepreneurs and tech workers, to share tips and strategies on stock option and RSU tax planning.

We discuss:

The different types of stock-based compensation and tax regime applicable to each
Deep dive on Incentive Stock Options + AMT + AMT “refund” rules
How an 83(b) election works, and pros/cons of doing it
Key tax planning strategies applicable to stock compensation (e.g. timing strategies, optimizing tax buckets)

Check it out here:

https://hackyourwealth.com/stock-option-rsu-tax-planning

Do you earn stock-based compensation? What tax planning best practices have you followed? What do you want to know more about when it comes to stock tax planning? Let me know by leaving a comment.

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Hack Your Wealth

1031 exchanges: what real estate investors need to know

Jun 01, 2021 Episode 72

Andrew Chen

#72: This week, I invited Bill Exeter to teach us about 1031 exchanges. He is the CEO of Exeter 1031 Exchange Services and has been doing 1031s for nearly four decades.

You might know at a high level that a 1031 exchange means deferring real estate capital gains taxes. But the details are important to avoid dumb mistakes that will disqualify you.

We discuss:

Different types of 1031 exchanges
Key criteria and deadlines + step-by-step process for executing a 1031
How to optimize timing your buy/sell transactions
Like-kind replacement property rules
Domestic vs. foreign property exchanges
What constitutes “Qualified Use” + holding period requirements
State tax consequences
Why investors can’t do 1031s themselves
The role of a Qualified Intermediary, how to vet one, and how much they cost
Tax impact of converting a 1031 property into owner-occupied housing, and vice versa
Common mistakes that disqualify you from a 1031
Proposed Biden administration changes to 1031s: likelihood of passage + actions you can take now to mitigate adverse tax impact

Check it out here:

https://hackyourwealth.com/1031-exchange

Ever done a 1031 transaction? What was your experience? Anything you would do differently next time? Let me know by leaving a comment.

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Hack Your Wealth

Buying tax deeds to invest in real estate at a deep discount

May 18, 2021 Episode 71

Andrew Chen

#71: Tax deed auctions provide an opportunity to buy tax-delinquent properties at a discount, wipe away existing liens and mortgages, and earn sizable profits in the process.

This week, I invited my friend Phil Kessler back to the podcast to teach us how this unique type of real estate investing works.

If you’ve ever wondered how tax deed auctions work, how to win them, and how to due diligence this type of real estate, then don’t miss this insight-packed episode.

What you’ll learn:

How tax deed investing differs from tax lien investing
How tax deed auctions work, how they differ from other foreclosure auctions
The most important things to due diligence when it comes to tax deed properties, and how to due diligence them
The most helpful online tools for property due diligence
How to buy tax delinquent properties BEFORE they go to auction (and avoid competing against scores of other bidders)
How redemption periods work, and which states have them
How a quiet title lawsuit works, how much it costs, and what happens if a title dispute arises
How tax deed auctions affect existing mortgages and liens, and how to verify the rules in your state

Check it out here:

https://hackyourwealth.com/tax-deed-investing

Have you ever bid in a real estate auction? What was your experience? What other questions do you have about tax deed investing that weren’t covered here? Let me know by leaving a comment.

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