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Speaker 1: What if you could hit a single financial number in your 30s that could allow you to take career risks, never worrying about retirement again? That’s Coastfi and today’s guest, Evan Lawler is working towards it.
Mindy: Hello, hello, hello and welcome to the BiggerPockets Money Podcast. My name is Mindy Jensen and with me as always is my more than Coastfi co-host, Scott Trench.
Scott: Thanks, Mindy. I’m excited to talk about a concrete financial plan here. We’ll get that in a second. Uh, with Evan Lawler today, he’s a full-time engineer and a part-time content creator. He’s known as the Financial Foundation on Instagram and YouTube, uh, and many other social platforms. And we’re so excited to hear about the foundation that Evan has already created for Coastfi and his new big milestones that are coming up. Evan, welcome to the Bigger Pockets Money podcast.
Guest: Thank you so much. I am so excited to be here and I hope that we can generate interest today with the audience.
Scott: Perfect. Yes. Already. That’s a real real credit to you. How does your journey with money start? Can you start from the beginning for us?
Guest: Absolutely. Yes. So I was fortunate enough to grow up in a household where money was a common topic of conversation. So I know a lot of people in their young adulthood need to learn a lot of those foundational topics of of finance early on, but thankfully, it was common for us to be having conversations about low-cost index funds around the dinner table. So for us, that gave me a super big head start. as well as I was always encouraged by my parents to start a Roth IRA. So from the age of 16, I was able to invest a lot of my earnings from the summer and part-time work. So, I was able to go into college with something like $25,000 already invested.
Mindy: And how old are you now?
Guest: I’m 25 now.
Mindy: Okay. And you plan on reaching Coastfi in about five years?
Guest: Yeah, that’s my goal. My my number is $500,000 by age 30. Currently, I’m actually a little bit behind that goal, but my objective is to increase my income in real dollars so that I can make up ground.
Scott: So tell me about what makes you feel like you’re behind that goal.
Guest: So, just from my projections, so at my current rate, I invest about $3,300 per month and so running the projections using a 7% growth rate, I’m actually on track to hit coast fire at age 31 or 32, depending on a couple different things. So I’m hoping to be able to put more away so I can hit that 500 by 30.
Mindy: And why Coastfi instead of going whole hog and getting to traditional fi?
Guest: Yeah, Coastfire is is very interesting to me and there’s probably three big reasons that I really like it. I love that fire has broken up into these different flavors of fire, but for me Coastfire initially was the math. So I think it’s hard to imagine for some people building a $5 million portfolio over 20 years, but it might be more attainable to say, hey, I can make 400,000 or $500,000 over 8 to 10 years. So building that investment portfolio was initially interesting. Next, I think that it’s unrealistic for me to imagine a time where I will not be working in some capacity and earning an income. I love to work both as a content creator and as an engineer. So for me, Coastfire continues with that assumption that I will continue to work. And finally, someone who is achieving Coastfire or on the path to Coastfire, still has financial independence retire early well within reach to them. So for me, it’s my current path, but in the future if I decide to pivot to traditional fire, that’s still available to me.
Mindy: So once you reach Coastfire, are you going to continue to put money away for your retirement so that your retirement can start stepping back or are you going to live life?
Guest: So, I’m not totally sure what Coastfire, the freedom and flexibility, what that will grant me in the future, but I think that that’s the magic of financial independence is that you buy yourself the opportunity to choose. I’m super interested in entrepreneurship and I don’t know whether that’ll be content creation or engineering, but I think that in the future, Coastfire could, could grant me a lot of possibilities.
Mindy: What kind of engineer are you?
Guest: I’m a mechanical engineer.
Mindy: I am surrounded by engineers. I am not an engineer, but I am surrounded by them. I just met another mechanical engineer. So, mechanical engineers don’t get paid peanuts. What sort of investments are you making? How much money are you putting away over the course of a year and what are you spending? How are you keeping this coast-fi goal going?
Guest: Yeah, you’re right. Mechanical engineers definitely don’t earn peanuts. We’re not like some of the software engineers where you have like a super high ceiling, but it’s still a very solid income. So, me currently, I earn just under $100,000 and I’m investing close to $40,000 including my company match. Right now, I’m putting a ton of that money, basically all of that money into my Roth IRA and my Roth 401K. And my portfolio is is 100% US equities. So, I’m in the S&P 500 specifically, FXAIX.
Scott: Evan, it sounds like you graduated college with some student loan debt and have began your journey over the last several years aggressively accumulating from there. I imagine some raises have gone into play and I imagine frugality is a component of your journey. But I’d love to hear it from you. What has your story with money looked like since graduation? How much have be able to save and how have you chosen to invest or allocate those savings?
Guest: Yeah, just as you said, when I graduated college, I had about $30,000 in student loans and the optimizers out there will will probably hold it against me. The the interest rate was about 4%, but I still chose to pay down those loans aggressively. I found that despite knowing the math, I I was struggling to sleep at night knowing that I owed that much money. So I was able to graduate and create a a large difference between the amount that I was earning and the amount that I was spending. For a time, I was living at home. After that, I was living with a roommate in a super cheap apartment, driving an older used car. And so in doing so, I was able to pay down these loans aggressively and begin to invest aggressively. And at the time I hadn’t even known about coast fire or really dove into the fire community yet at all, but with the margin between my income and my spending, I was able to begin pursuing those goals without even knowing what they were yet.
Scott: Awesome. And when did you discover fire? When did this this instinct to accumulate money translate to a more coherent, you know, strategy to pursue freedom?
Guest: I was always interested in personal finance and learned about that in high school and was listening to a ton of content throughout college. Fire to me, I initially had this assumption that in order to pursue financial independence, you had to be living on peanuts and never spending any money and it was a really extreme lifestyle to pursue. But it was through getting engaged with content like your show and others that I learned that you can pursue these goals in lots of different ways and there’s a spectrum of people that pursue financial independence whether traditional fire all the way down to Coastfire. So I learned about that as I graduated college, which would have been 2023 and and kind of had just dove in over the last couple years.
Mindy: Evan, I ran your numbers through the Pioneers Coastfi calculator and in order for you to have $500,000 by the age 30, that says that you’re going to grow to about 5.2, 5.3 million by the age 65. Is that what your numbers are calculating as well?
Guest: Exactly right. Yeah. So my goal is to reach that $500,000 by 30 and then be around using the 4% rule and inflation adjusted, $200,000 per year retirement income at age 65. So that’s exactly right.
Mindy: And how much are you spending right now?
Guest: I’m spending a little bit less than $40,000 a year.
Mindy: So 40,000 to 200 is kind of a big jump. and yes, between age 30 and age 65, you’ll probably spend a little bit more, but as somebody who has struggled moving from saving to spending, this is a huge jump. How do you plan on embracing your spending side?
Guest: That’s a great question and I’m excited by the fact that the fire community has kind of addressed this concern. I think as more people actually achieve early retirement, it’s this quote-unquote problem which has emerged that definitely needs to be addressed. For me personally, I imagine that my spending will go up substantially just as I have a family and get married and buy a house and things like that. I think a lot of the spending will be eaten up by that those kinds of things, but I also think that it will be a bit of a journey for me to learn how to spend more because now I I’m absolutely more frugal than I am not. So learning that skill will will be a learning curve.
Mindy: And what do you spend money on right now? Like, what are you giving up and are you in a high, medium, low cost of living area?
Guest: I live just outside of Philadelphia, which I think would be in the medium to higher cost of living areas, in the suburbs of Philadelphia. So one of the ways that I save money now is that I share a super cheap, old, no frills apartment with my girlfriend. It’s like 650 square feet. And honestly, that’s probably my biggest rock. It’s the thing that moves the needle the most for me. And and that’s one way I’ve been able to save a ton.
Mindy: And how much is rent?
Guest: Rent for us is $1,195.
Mindy: And that’s together. So you pay half of that.
Guest: Yeah, yeah, we split it equitably, but yeah, I pay a portion of that.
Mindy: Okay. I mean, that’s huge.
Guest: Yeah.
Scott: When I do some of these like analyses across the country, one of the things that I think people on the West Coast, there’s there’s no options like that on the West Coast or they’re very rare or they’re very very different. In the East Coast cities, you have these very crazy dynamic, you know, excluding New York City for example, in many of the, in many, you know, place like Philadelphia, Baltimore, DC where there’re really cheap places to live. Sometimes the places that are very cheap are very undesirable for for folks in the fire journey. And Philadelphia I think is actually one of those places where there’s really great income opportunities and really cheap housing opportunities in certain cases. Tell us about how, how the trade-offs that you’re making with an apartment that is this cheap for someone who maybe is a is a skeptic on whether this can be feasibly done desirably in or around Philadelphia.
Guest: Yeah, I think you’re absolutely right that we have a spectrum here in Philadelphia that you can be in an expensive high rise or you can live like me in in a building from the 60s or 70s that doesn’t have anything to write home about. Some of the trade-offs that we have is is that there’s no amenities and that square footage is tough to come by. So we have to make decisions every single time we buy something, not only if we can afford it, but if it’s physically too big. So, for example, we were able to find this really big, beautiful family table for free on Facebook Marketplace. We were going to go rent a truck and get it, but instead we ended up paying $50 for a much smaller table, which was lower quality because we could have never fit it in this apartment. We would have taken up all our space. I understand why some people are skeptical about kind of living small, but I think it’s almost a virtuous cycle that as you live in a smaller place, then you accumulate fewer things. you save money not only on rent, but the things that you buy.
Scott: Yeah, and another big call out I’ll I’ll share is that because you live near Philadelphia, you don’t have to purchase YouTube TV’s direct or Sunday ticket to watch the Eagles across the course of the season, which is a major expense that I have to factor into my fi number here personally. So, that’s another, you know, big, big, big advantage of living where you live.
Guest: Absolutely. Yeah, but you don’t have to deal with the game day traffic. So, that’s a trade-off there.
Scott: Go birds.
Guest: Go birds.
Mindy: I wanted to talk about the amenities that you’re giving up. I say this in air quotes because I don’t know that you’re really giving them up. Just because you don’t have those amenities in your building doesn’t mean that they’re not available to you at all ever. I’ve seen some and it’s been 100 years since I lived in an apartment building, but I’ve seen apartment buildings that do have laundry in the building and then some that don’t. There are apartment buildings with a great gym or a swimming pool or both or a doorman or you know, an elevator. I was never fortunate enough to live in a building that had an elevator. What are some other amenities or what are some amenities that that you would like but don’t come with your less expensive apartment?
Guest: I think the biggest one that stings me is a gym. So I have these old used dumbbells that my previous tenant left here. And so I’m lifting on the floor of my my living room. So if there were one thing, either the space to kind of have like a gym or a lot of apartment buildings offer those gyms, but you’re totally right. Some of the amenities I think are out of this world that some of the apartment buildings offer like, you know, a pool, a doorman. I know one place that goes out and gets coffee for the tenants of the building each day and has it down in the lobby with bagels. Something like that would just be totally out of this world. The one hill that I’ll die on that I think that the amenities is not worth it is a an in unit washer dryer. So currently we have an external laundry room and in order to have your washer and dryer inside your apartment, you’d have to pay hundreds of dollars more. But personally I don’t think it’s worth it at all and there’s three in the laundry room so if you can go when no one else is going there, you can do a ton of laundry. And so I always get a lot of hate on that on social media.
Mindy: I wonder if people take the time to like work it out. How much extra it costs to have an in-unit washer dryer? I really like having a washer and dryer in my house, but there are times that I have had to go to a laundry mat. Our washer broke, so I had to go to the laundry mat to do my laundry and it’s a hassle, but it’s not worth. I had to wait till Carl got home so he could fix the washing machine. It’s not worth it for me to pay $500 to have some guy come out and fix my washing machine when I could go to the laundry mat, uh which has gotten infinitely more expensive than the last time I was there. but a couple hundred dollars a month versus walking down the stairs to do your laundry, you can take that couple hundred bucks and put it into your Roth IRA that you mentioned before or put it into your, you know, paying down your debt. Dave Ramsey has such a great quote, live like no one else now so you can live like no one else later. And do you get a lot of hassle from your friends that you live in a lesser apartment building again, in air quotes cuz I think it’s not lesser at all.
Guest: Yeah, I think that is a great point. I think that people should spend money on whatever they want to spend money on, but you’re exactly right, Mindy, that I think if you actually count the cost of a lot of these things, you’d realize that you’re paying hundreds of dollars for something that only potentially marginally improves your life day-to-day. I do get a lot of slack from my friends about my apartment building. Some of them live down in DC and have really nice places. Again, with the nice amenities, the in unit washer dryer, I got a lot of hate on, but all in all, I’ve been this way for a long time. So they know where I’m coming from and especially with my social media page, they’re watching me try and save money as much as I can. So they do give me a hard time, but it’s all in good fun.
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Mindy: So what else do you think that you are giving up or pushing down the road by spending less than $40,000 a year?
Guest: Yeah, I I definitely live a modest lifestyle. I haven’t been on many big vacations. Thankfully in Philadelphia, we have the wonderful Jersey Shore, which people flock from all over the world to come visit. So I I get to go there for my vacations. I I don’t have always the nicest clothes. This Patagonia was used and and a birthday gift. For me, I I focus so often on on what I have and and what I can go out and do that I don’t even often think about what I’m giving up. And just like you mentioned, Mindy, I’m always running the cost. So if I want to hang out with my friends and have a bunch of food or even go to a local restaurant, I I know that I can afford that. So those things that bring me a lot of joy, I actually do go spend money on.
Mindy: Have you listened to Ramit’s podcast?
Guest: I have listened to Ramit’s podcast. Yeah, I’ve listened to to probably every episode. The only the only show I listened to more is Bigger Pockets Money.
Scott: All right.
Mindy: Would you characterize your life as a rich life?
Guest: I would absolutely characterize my life as a rich life and just like Ramit talks about in his podcast, I don’t think other people would would want to live my life and I’m totally okay with that. And I think that I focus on the things that bring me a lot of joy with the understanding that in the future, I I’ll spend more on the things that I want to do. But I think that I live a very rich life.
Scott: We have made a conscious choice to keep housing expenses in particular very low and that is the fundamental variable in your savings rate. I also want to call out that you said you’re making about 100 grand, you’re spending about less than 40 and you’re accumulating about 40,000 per year. A byproduct of that is that you’re paying taxes voluntarily to max out your Roth instead of your 401K. So first, I’d like to hear about that decision. Why are you why are you making that decision right now when you could arguably increase your savings rate with a 401K? And what are you projecting? Where does this lead and by when?
Guest: Currently, I I’m totally maxing um my Roth opportunities. So Roth IRA and Roth 401K, 100% allocation into my Roth. Obviously, I have my company match, which is pre-tax dollars. The reason I like Roth is because from what I understand Roth is first in, last out. and I understand now that these years are my first in years. So I think that it grants me flexibility in the future and I don’t have to worry about ever changing tax rates or potentially increasing tax rates. So having the flexibility to to take that money out without any tax implication is something that’s super appealing to me. My current assumption shows that I’m on track to be 32 years old with about $564,000, which would be my coastfire number. but I’m trying to bring that number to $500,000 by 30, which would achieve my coastfire goal as well.
Scott: So let’s talk through how you project this out. First of all, is that number just the amount you’re going to have in your Roth 401k?
Guest: That number is across all my retirement accounts. So my IRA and my 401k.
Scott: Okay, great. What are you assuming for your salary growth over this time period?
Guest: I’m assuming that I’m going to continue contributing the same amount, um but if I make more money, my current assumption is that I won’t put any more towards my investments.
Scott: And do you assume that you’re going to see salary increases over the next five years that are meaningful?
Guest: I haven’t built it into my projections too much, but I do expect that I will see salary increases over time.
Scott: I think this is a really important point because I think that, you know, how how can you build your model any other way than what you’re doing here as a base case. And there’s almost no way that someone who is living frugally, working very hard, self-educating is 25 at the very beginning of their career is going to go a five or six or seven year period in a situation like yours without finding salary increases, right? It’s a very low probability that that could happen. It could happen and if it does happen, you’re better positioned than most because of your savings rate and you know, it could happen that you get laid off and actually there’s a there’s a big setback. But the most likely path forward is promotions and opportunities, right? If someone offered you a promotion in a few years and said, hey, here’s a two-year path to becoming a manager, would you say yes to that opportunity right now?
Guest: Yeah, I absolutely would.
Scott: So I I think that there’s a very good likelihood that that will happen and this is missed by a lot of people, right? The career growth does not happen linearly. It’s a compound or step ladder over time for situations like this. Have you modeled that out at all? Have you have you thought about what what that career path looks like in a field like yours?
Guest: I haven’t modeled it out. I think that my conservative nature, I always want to make the most conservative assumptions possible and I think you’re exactly right that I I am underestimating my ability to grow my income in real dollars, but I think that if I incorporated those changes, it would show that I am at least on track to to achieve that goal.
Scott: One of the things that I observe, I again, I don’t know the Philadelphia market very well, uh despite being a Birds fan, I don’t really know the neighborhoods or or those opportunities. But on paper, you know, in in a spreadsheet, it looks like a prime place to house hack or potentially look for cash-flowing real estate opportunities because of a relatively low medium price and relatively reasonable rents as a ratio to that price. Is that your observation as well? Is that going to be a part of your plan at some point in the next few years?
Guest: It’s such a great question and it’s something that uh has been spinning around in my mind for years now. I have so much more research and understanding to build on my end to understand how to effectively go out and house hack and do those things. I think you said in the past regarding house hacking that it’s something like a 100 hour obligation in order to reach some level of functional understanding and and I’ve got about 80 hours to go. So from my preliminary understanding, I think that you could be exactly right. It could be something that I incorporate into my financial picture moving forward, but I would have to make sure that my girlfriend was on board as well.
Scott: I just think your approach to how you’re handling everything is so wise. You’ve kept your housing costs low. you are making calculated decisions. You’re going down an optimized stack for for, you know, in order of operations and investing. You’re making a clear trade-off, you understand the cost and you understand what you might get in return. And I think that you’re right to be both interested and skeptical of house hacking and real estate right now in the Philadelphia area. I will say that, I don’t know if you’ve considered this as well, but I think that your career based on what I’m I’m seeing has excellent prospects but not like top 1% prospects for income, right? As what I’m gathering from from what you’re saying here. Like there’s a very realistic path to $200,000 a year in your 30s but not $500,000 a year in your 30s on the current career trajectory. And all of that, it’s right where you should be in terms of your mental state, right? If you’re if if you are making, if you had a path to making much more than that, I’d say, don’t house hack a $200,000 quadplex, you know, in Philadelphia, right? That doesn’t make any sense because then you’re going to then in 10 years, you’re going to be making $500,000 in your big law or finance career and that’s going to be a complete distraction. But in your case, there’s a really real path where if you house hack several times, you can own several pieces of property, get into that $200,000 range and continue to deploy capital in there and a very, you know, with a skill set that you’ve developed. you know, you can also go the other route and just invest passively. You have both options there. And that’s where I think you’re correctly treating real estate as an option and not a a clear yes, no at this point. And I’ll be really interested to see what you end up doing given your position.
Guest: Yeah, I I totally agree and I appreciate you saying that it’s a wise path. I like to consider myself almost like a young Scott Trench taking on the world in the Philadelphia area again. So, really almost a compliment for yourself.
Scott: Oh, I think you’re doing a much better job than I did, right? So I I was just so hard I was not considering Coastfire. It was get ahead uh at that point. So I think you’ve just taken all this stuff and are making much better decisions than, you know, thinking about it much more, much more robustly than I was at 25. So I think I think you’re crushing it.
Guest: Thank you. Yeah, and I think you’re right about the income growth that a lot of people like, they almost turn their brain off a little bit when they hear like, oh boohoo, instead of earning $800,000 top line, you could possibly earn $200,000 that’s still a lot of money. but at the end of the day, those are two like categorically different numbers. And I think you’re exactly right that for some people who are investment bankers or management consultants who have such a high ceiling, they can go just work their job. but I think for people who are engineers who earn a very strong salary, but maybe that ceiling is not quite so sky high. those other opportunities are really important.
Scott: Yeah, real estate is such a powerful tool for someone in that category because you can swing the hammer yourself and it makes sense to do that in the extra hours, right? The 70th hour at your job does not return in those situations and that’s why it made so much of sense why it’s made so much sense for me as a financial analyst, right? There was no credible path when I started down my real estate journey as a financial analyst to making big bucks, right? without some sort of really hard or total, total pivot. And so it made perfect sense to spend my extra time after my day job doing something that could create value like real estate. But again, if I had been in one of those, those other other trajectories it would have it would have changed. And and in your case, one one question that I’ll also ask here is is you are accumulating the vast majority of your wealth in retirement accounts right now, right? You’ve you’ve discussed that. you know, have you considered the opportunity cost of that or or have you considered amassing some after tax position on top of that intentionally as you kind of approach 30 to to make some of these other options like real estate or or entrepreneurship or those types of things maybe a little bit more accessible or is that off the table for now?
Mindy: Well, he’s got the money in the Roth. Does that kind of cancel out the need for a large after tax portfolio because he can access the funds that he’s put in after five years?
Scott: Great point.
Guest: And when we say after tax, are we talking about a brokerage?
Scott: Yeah, I’m just I’m more asking, you know, you’re you’re interested, you’re potentially interested in real estate, there’s kind of like a, I I want some options as I approach Coastfi, is the intent to use the money that you’re committing to these retirement accounts as those funds, um, or do you have some other plan to amass cash or other liquidity to create those options at that point, you know, via another mechanism?
Guest: It’s definitely something that I’ve considered before by tying up that money into these retirement accounts, I get the advantage, the tax advantage, but I totally understand that the tradeoff there is that I basically can’t access that money without using the Roth that you mentioned, Mindy. but at my current savings rate, I I plan to if my income were to grow over time that I would modestly increase the amount that I’m investing to try and achieve that coastfire goal of 500 by 30, but any additional income, whether that comes from my job or my part-time content creation, my consideration for that would be to take that money and make it more flexible and available to me probably through a brokerage account in order to have the opportunity to pursue those goals in the future.
Mindy: Are there any mechanical engineering side hustles available? I’m not a mechanical engineer, so I’ve never even looked.
Guest: The one that comes to mind is that if you are a certified professional engineer, which I’m not yet, you have to work for at least five years, then you can start a small company which uh reviews and approves or denies and stamps drawings, which is a a way that some people make money. It’s not exactly the industry I’m in, so it’s not something that I’ve ever really considered doing, but it doesn’t lend itself particularly well to a bunch of side hustles.
Mindy: Do you have any side hustles that you do or are interested in or is it kind of not worth your money or your time because of the money that you make in your main job?
Guest: The only side hustle I have primarily is my content creation. So just kind of sharing my foundational principles of personal finance. I’ve been able to kind of grow an audience there and from that kind of like initially now like a modest income.
Mindy: So, it’s really just that that main income or any real estate income that you might have. So have you thought about job hopping?
Guest: Definitely. I know the statistics around job hopping are historically great. I haven’t looked at them now whether or not it’s still worth it to be doing that. Currently, I’ve just been at the same company since school. It’s only been about three years or so, but it’s definitely something that I’ve looked at in the future whether it’s to job hop and and get a greater opportunity or to to use the offer from another company to negotiate at at my current company.
Mindy: Yeah, that is a skill you could start learning and growing is your negotiation skills, negotiation for more time off or better pay or better benefits or work from home some days if that’s an option. That’s a skill that I never had and I kind of wish that I did.
Guest: Yeah, negotiation sounds like a super great simple thing to do, but I I totally agree when I was graduating college and and they gave me the number, I said, great, thank you. And even though I should have I knew that I should have negotiated.
Mindy: Yeah. Well, and when did you graduate?
Guest: I graduated college in 2023.
Mindy: I mean, don’t beat yourself up for not negotiating that. Nobody negotiates that their first offer. You’re like, I’ll take it.
Guest: Yeah, yeah, exactly right, exactly right.
Mindy: But do you have a praise folder in your inbox?
Guest: a praise folder?
Mindy: In your work inbox. Anytime somebody says, Evan, you did such a great job on the XYZ project, thank you so much for your input. You put that in your praise folder and go back through all of your email and look for anybody saying, hey, you did a great job or your contributions helped us. And then when it’s time to ask for a raise, you don’t just go in and say, hey boss, I’d like a raise. You go in and say, hey boss, here’s this giant print out of emails. Don’t just forward them, print them out and hand them to him. sorry Teresa for killing you, but here’s all the reasons why I am such an asset to this company and I think that you should give me a raise of X dollars.
Guest: That’s awesome. Yeah, I have a list of running projects that I’m working on and completed, but I love that idea of collecting that feedback because I think that that really goes a long way. I I don’t have a praise folder, but
Mindy: Yet.
Guest: Consider it done. Yeah, exactly.
Mindy: And I would love to take credit for that, but that was Aaron Lowry from Broke Millennial who first suggested that. That I heard for suggest that. So praise to Aaron. Good job, Aaron.
Guest: Thank you, Aaron.
Scott: I’ll piggy back on Mindy’s thing here and I’ll say, uh on top of that or, you know, as a parallel, I would in the next six months approach your boss and say, what opportunities are there for me over the next couple of years? And how do I think about what I need to do? Like what are some bars I can clear to be eligible for those opportunities like is there a chance to to work into a management role? What are some things you like to see? And we talked about this on a recent episode with Paula Pant, but a lot of companies and a lot of divisions, depending on how big your company is, will need a full year to put in into the budget your raise and promotion in there. So if you can get way ahead of that with your manager and really kind of crush it, you can you can start to make those those odds much more probable. It may be unrealistic to ask for a raise in February when we’re recording this, I think it’ll this will get released in March because everything’s baked in, but if you have those conversations now, those leaps can be much higher probability if you’re getting way ahead of them and thinking in those those capacities and saying, what are what are those clear things I need to deliver or demonstrate some. That would be my advice on top of Mindy’s to keep a praise folder.
Mindy: And a lot of your coworkers are not going to your boss and saying, what can I do to improve? What can I do to grow? So, your boss already thinks you’re awesome and now he thinks you’re extra awesome because you want to make his life easier. When when you do a good job, he looks good and then his boss praises him.
Scott: Or she.
Mindy: Or she. Yes, I’m sorry, so sexist of me. But having that initiative is so valuable. Wouldn’t you say Scott as the head of the company?
Scott: Oh, I love it. If if someone came to me with that, I would say, great, here are some things that I really need done. If they get done, this makes it so easy for me at a high level. and of course, I’ll do that. If this this timing is perfect, I can put that into the budget for next year instead of, you know, asking for more money right now for an off cycle situation. Like that would that would make it really easy for me.
Guest: Yeah, I think that’s great advice and awesome insight because I think especially as a young professional, a lot of people go in and they feel as though whether it’s a bonus or a raise that the conversation is happening right there and that this is the only moment that you could have mentioned getting a raise or getting a bonus when in reality, like you mentioned, that decision might have functionally been made in the summer or the year before when the budget was created. So I I think that’s great advice and I I’ll definitely be doing that.
Scott: What I think is so awesome about your story is it starts with an engineering degree, a high ROI degree, right? That’s that’s not as fun as the at Vanderbilt, we had the HOD degree, which is a relatively easy set of class coursework compared to the engineers in there, but the engineers will often times get very high starting salaries and the career progression is is excellent in the first, especially the first, you know, 5, 10 years for a lot of engineers that uh proceed up professionally. That’s the number one thing that makes this fairly straightforward from an income perspective. The second is, you live frugally. you live way below your means relative to the peers that are earning the same amount of income as you in your city. And then you have a basic grasp, a very strong basic grasp of a very excellent grasp of the foundational principles of personal finance and you go down the stack, investing. And what’s so awesome about your your situation here is that for other engineers that are pursuing similar career trajectories, there’s nothing that that can’t be repeated here. It’s just very basic stuff that leads to obviously to freedom with a very conservative projection profile. So congratulations on what you’re doing and thank you for sharing this. The the thing that’s awesome about what you’re doing is that it’s so repeatable by others who graduate college with an engineering degree or similar.
Guest: Absolutely. Yeah. I really appreciate that and and I think you’re exactly spot on that my approach is to do the the basic elements as as perfect and as much as I possibly can and so far so good. So, thank you.
Scott: Last question before we wrap up, Evan. How do you feel about money these days?
Guest: I used to feel nervous about money. I I liked to keep it and I didn’t like to spend it and I would agonize over these small expenses, but I will say a testament to myself, pat myself on the back, uh that over the last couple years diving into personal finance content including Bigger Pockets Money and running numbers. I’ve recognized that the smaller expenses that financially ambitious people tend to agonize over, really do not move the needle compared to the three to five big decisions that you might make throughout the year, transportation, housing, asking for a raise, the investment vehicles that you choose to buy into. So with that, I found myself sleeping sounder at night and feeling far more confident about money and and finding it as a way to enjoy my life more, not something to hoard or agonize over.
Scott: That’s a wonderful evolution there. I also would guess that there’s a bit of a, well, it seems like it’s pretty much an autopilot these days feeling to it. That’s, you know, probably both frustrating and boring perhaps. Is that is that at all a reasonable conjecture?
Guest: That’s exactly correct and that was uh thanks to Ramit. He talked a lot about like building automations into every single thing that you do. So autopilot is spot on that I I don’t have to check my investments or everything comes out automatically. Of course, do I still check the investments every single week? Of course I do, but I don’t have to.
Mindy: Yeah, I think that’s everybody.
Scott: Evan, thank you so much for coming on the Bigger Pockets Money podcast. Thank you for all the support. Where can people find more about you?
Guest: Thank you so much for having me. You can find me on Instagram, Facebook, Tik Tok, and YouTube @the_financial Foundation.
Scott: Awesome. And I follow you across most of those, but not all of them yet. I’ll have to go, I I don’t think I have Tik Tok downloaded on my phone. So I’ll have to get that one. But thank you for all the great stuff you put out.
Guest: Thank you very much. I really appreciate it.
Mindy: Yeah, thank you so much for your time, Evan. We’ll talk to you soon.
Guest: Talk to you soon.
Mindy: Okay, Scott, that was Evan Lawler and that was a lot of fun. I’m so excited for his future and I bet he crushes his goal. What did you think of his story?
Scott: Yeah, I thought it was great. I’d bet him a dollar after the show that he will approach his goal by age 28 and a half because he has not factored in raises or promotions that I think are very realistic for his career. He has not factored in growth in his side hustle. He has not factored in any other upside events that could possibly hit his situation. Although there could be offsets too with the stock market. That’s why it’s only a dollar bet from here. This is my gambling budget for the month. I’m very optimistic about his path forward. We also talked about one more issue. I’m like, oh these things happen right after the recording sometimes, but I asked him and he’s going to post this to the the financial Foundation, I think in the next few few weeks, what would have to change about his income profile for him to flip from prioritizing the wrath to the tax deferred or 401K equivalent for his position. And I think that was a really good thought exercise and I’m really interested to see what he, what he comes up with, what his answer is for him personally. I think it will have to do with marginal tax brackets and, but I’m really interested to see what he comes back with on that. I think that’s a a fun thought exercise for other people to contemplate as well. If you’re currently prioritizing the Roth, under what conditions would you flip to the 401K or tax deferred equivalent? That’s a fun challenge to question to answer for yourself.
Mindy: I think so too. I can’t wait to see what he says. That’ll be really interesting. Scott, are you doing a Roth 401k or a traditional 401k?
Scott: I am now when and if extra income hits, I will prioritize the HSA first and then the 401k at this point right now.
Mindy: The tax deferred 401K?
Scott: Yes.
Mindy: That’s what I do too. We would love to hear from you. Anybody prioritizing the Roth 401k over the traditional pre-tax 401k, hit us up and tell us why. Mindy at biggerpocketsmoney.com, Scott at biggerpocketsmoney.com. All right, Scotch, we get out of here.
Scott: Let’s do it.
Mindy: That wraps up this episode of the Bigger Pockets Money Podcast. He is Scott Trench. I am Mindy Jensen saying, we’re out, trout.
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