First Time This Has Ever Happened... | Financial Audit

Hi, I'm Alex. I'm 22 [music] coming out. of San Antonio, Texas. This is Financial. Audit. Welcome up to Austin. So, what do you do. for a living currently? I work as a facility technician is what. it's called. I work in critical. environments. Um, there's a couple companies that do. it. Um, couple companies. So, you're are you. contracted at different companies? I just work for one, but there's a. couple competing. Oh, okay. What are you currently making. this role? I'm making 105,000 a year. Woo. You said.

22. Yeah. Woo. $105,000. a year. What the? That is awesome. Congratulations, sir. Thank you. What do you. Wow. Okay. What do you need to get into. this career path is what everyone is. asking. Um, I didn't go to any kind of school. I. started working at 17. I lived in. Germany. Worked for a Volkswagen Audi. dealership. From there, I did apartment. maintenance, hotel maintenance,

um, and just gained a lot of knowledge. about HVAC, mechanical, electrical, which is what I deal with. Um, and part of the reason I got the job. is I was just in the right place at the. right time. I was buying a motorcycle. off a guy on Facebook Marketplace. His AC was broken. I was working in. apartment, so I had extra parts. and he. was like showing me the the um fan on it. was out. I was like I have a fan I can. just bring you um cuz I'm going to come.

back and buy the motorcycle. So I. brought him fan helped him fix it and he. ended up referring me for the job and I. got. that's incredible. How long have you. been making this kind of money? Uh since August of last year. Of last year. Yeah. So you must have lifestyled inflation. the out of yourself. Like something must. have happened. You've been making good. money. Yeah. You. I mean that's. more money than I've Well, that's more. money than I've made before this job. Uh. I think with some sales stuff I may have.

gone slightly over on really good times, but dude, at 22 I was never even I. wasn't even close to making that kind of. money at 22. That's incredible. How are. you? Possibly possibly why. why in your situation have you gone and. just taken out insane interest rate debt. across the board? I want to know why. you've done that. And then I also want. to know why have you not paid them off. is this is something you should have. easily been able to take care of. Is.

your family in San Antonio? Um no. Okay. Even still, San Antonio, you can. live relatively cheaply. Yeah. What the. So, [sighs]. it actually used to be worse. Okay. Yeah, it it used to be a lot worse and. I've been slowly paying things off this. year, but. slowly. it's definitely could have been better. I. I.e. minimum monthly payments. Yeah, for the most part. Um I did have a.

car I got rid of, motorcycle I got rid. of. Um. Okay, I'm sorry. I'm going to interrupt. you. I'm I'm sorry. So that means at one. point you had four vehicles. Might have been moreing. No, it was four. It was It was four at. once. That was the worst I had. Um. 22. Why do you need that? I just love cars. I like. Okay, that's that's what I love. It's a. terrible hobby to get into because it's.

just so. expensive. You can do it right. There. are people who do it right. You absolutely can. I did not. Okay, this is honestly like the thing. I've been most excited about for months. and months and months, and I get to. finally talk about it. My team and I. have spent billions of hours, it feels. like, going through every budgeting. course that exists online. What did we. find? Well, a lot of influencers and. gurus like to do quick cash grabs and. not go through a lot of detail and they.

barely give a variety of situations that. can apply to a lot of people other than. a very specific narrow few. Resources. are rarely provided and thorough. examples are not given of how to. actually budget. So, I partnered with. people in the finance space who are. really smart and have a lot of. experience when it comes to overall. finances and we created the best. budgeting course that has ever existed. Hands down. Compared to anything else. online, we cannot find anything even. half as good as what we have made. We've.

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is like half the price of the average. price out there. We want to make sure. it's accessible to anyone, but also. hoping to at least break even on the. thing. I always said from the beginning, I would never do a course unless I can. make it the best it can be and fill a. void that does not already exist. The. simple truth is, Americans, we suck at. budgeting. We suck at budgeting. We've. created hours of truly educational. material that actually teach you how to. budget, actually stick to a budget, and.

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so excited to finally announce this and. you can get it in the description below. It's right at the top. I highly. recommend it. Take control of your money. for the first time in your life. Yeah, I continue. You know, I like when. I turned 18, I got a cheap little. uh like $3,700 a GTI. and. spent more money than I bought it for in. parts to modify it. Did the value go up.

with it? Isn't Isn't that one of those. cars that no maintains value quite well? Yeah, but then the engine blew and so I. sold it and then that happened with. another car I got. and. it just been kind of this endless cycle. of me buying cars because it's fun and I. want. What about the other debts? I mean, we're talking credit cards and. we were just like. the credit cards is just unwise. spending. You make way too much money though. I. do. Are you telling me you have not budgeted.

ever? I have a budget. I just don't stick to. it very well. Well, then that's not having a budget to. be clear. Physically having. Okay. Okay. All right. [panting] Okay. So, Okay. Give yourself. a score zero to 10. Sorry. Is this you? It's this I think I think this is. actually an exciting episode. think this. is going to fall down towards episodes. that people have actually requested a. higher income earner.

but are just not doing well. and that is clearly you. What scares me. is, man, you're developing these habits. in your young 20s, 20s. Where where are we in our 30s at that. point? If this is what we're developing. in our 20s, where are we in our 40s and. 50s? Are we retiring? I don't know. You've put money to retirement. I'm. actually happy where you are there at. 22. It's incredible. But you've just. negated the whole thing by putting. yourself in top of the pile here is 18%.

I wouldn't be smiling. I'm terrified. That scares me. Give yourself a score of. 0 to 10. Maybe a two. Yeah. Your retirement is going to be. what carries you. Your retirement is. going to be what carries you. So what. [snorts] is this? So what is this? So. what is this? Because what we have here. are three of these Navy Federal consumer. loans. of just death. Of just death. So we have. What is it? Which one?

Uh 18% 16,9 uh $16,000. That's a. Corvette. Okay. Well, a what? Uh 2008 Corvette. You have a picture of it? I do. Can I see? Yeah, absolutely. I'm not a car person. I need to put this. into visual for myself. So, we owe 16, $69. at a death. 18%. 18%.

All right, I'll admit that it's a cute. car. If I saw it, I'd be like, "That's a cute. car." Okay, I will admit that. By the. way, could you email those to us? Yeah, absolutely. Um, okay. Minimum monthly payment 413. These are going to add up. I already. know. They do. Having obviously gone through it. It's terrible. It's terrible. Why do you You don't need. this, man. Okay. I don't. Okay. No. No. Okay. Let's Let's Let's. Let's step back for a second. Even. though we've barely even dipped our toe.

into this, you make $105,000. How much was the car? Car was 17. Okay. Five. You could afford that. That's great. Yeah. I could have got you to do that in cash. Okay. You You don't do cash. That's. fine. You might have to borrow for it. Okay. You borrow for it. If we have to. borrow at 18%. Is this a car worth. getting? I don't think so. No stock. market return. No stock market return is. going to beat that. So what the on a. depreciating asset? Well, I don't know.

A Corvette is it? How well does this. maintain value? Uh take care of they kind of depreciate. and then they hold value for a good. while and they depreciate more. It. depends on the model. This is a base. model. So it's it's going to be worth 17. grand for a long time. But you bought it at. 18% APR. Well, you bought it at what? about 175. Yeah, which is pretty low for this car. The. only issue is that I blew up the engine.

running nitrous. So, you've blown up two engines. Three. What are you? What are you? I'm. confused. Why? Why are you blowing up. engines? Uh, I like to add power to cars and go. fast. It has wheels and goes faster. But why are you blowing them up? Like I. So, oh, this is this is beyond me. cuz I. don't give a I have a Jeep Cherokee. Yeah. I'm going to run it into the ground. What are you doing? It's It's a hobby. Break it and you fix.

it. It's just an endless cycle. Okay. That's That's just what you want to. break it. I like fixing things. I don't. want to break it. Want it to break, but I want to go. faster. Faster is by adding more power. And more. power breaks things. [snorts]. My gosh. So, I mean, I'm just Okay. Where Where are. you driving these? Mexico. This is weird, man. [laughter]. I I did not know what I was walking.

into. What? So, San Antonio. So, you drive uh. like what, six hours south? Yeah. There's no speed limits on the. highways in Mexico in some stretches. Yeah. But couldn't you get someone else. killed if I mean and yourself? Yeah, fast is fun. I get it. Go fast on a. roller coaster. I'm a bit of an adrenaline junkie. Cool. But what about the other person's. life in the highway? You go when the highways are empty. 3 4.

a.m. And you can guarantee there's not going. to be a single other person cuz. nighttime now that becomes more. dangerous. There's very few people. What about uh uh spending a little. money? Well, well, I mean, if you manage. your situation correctly, you could. What about uh some time at a at a strip, right? The closest strip is like five hours, I. think. Isn't Mexico 5 hours? Something like that. Yeah, they shut. down the strip in San Antonio a while. back. Okay, why not go the five hours to the.

more safety oriented thing? I'm just. thinking of Okay, obviously I want you. to live, but it just becomes a selfish. thing. It becomes a selfish thing where. you're doing this and putting. the risk in other people. Mexico doesn't. have any speed limits. Um, some stretches of the highway there. Interesting. It's kind of unregulated. Interesting. Yeah. How often are you doing this? Well, not anymore because engine blew. up. So, it blew up. Uh, so what does it take to fix that? [sighs]. Too much is the answer. I need to take.

the machine shop sitting. eight if I'm lucky. Um, I need to take. it to machine shop. see if the scratches. on the cylinder bores are fixable. And. if they are, then probably eight grand. all said and done. If they're not, I'm. probably in 12 for a new engine. So, you keep blowing these things up. What did you have to do? I'm just This. is just for me. I I hope it's. interesting to y'all, but I'm just like, what did Osama bin car over there do to.

blow up all these engines? Uh, a lot of nitrous and a lot of boost. from turbos. So, the vet was a 300 shot. of nitrous. It was doing a 200. Okay. Which uh 200 shot adds 200 horsepower. 300 three. Uh didn't like the three as. much. Gosh. All these in my head. So, what I'm. hearing is just stupid. Yeah. Yeah. Exactly. You know what's not stupid? Hitting the. subscribe button. We're trying to get to. a million subscribers and I can't. believe I'm even saying that. You guys. are awesome. You guys are amazing. You're amazing for being here. Not.

amazing for blowing up cars. Thank you. because we talked about one. thing already and we've already gone. down the rabbit hole of death and. insanity. Starting to blow up a little less. as time goes on. Yeah, I'd go for zero blowing up is what. I would go for personally. In my car. experience, I go for my car is not. blowing up ever. Might just be me. Might. just be me. What is the 17.75% interest. rate of death? How much is it for?

1577. That's what's left on it. Uh that. was the first car I bought. It was a. Volkswagen GTI. Uh. do you Does it exist anymore? Has it. blown up? Yeah, it's not running and it's not. worth fixing because actually last month. I brought the balance down to $1,000. So. it's like in the next paycheck I can pay. it off. But to be very clear, you have these. insanity 18% interest rates on things. that are not operable. Yeah. They're you can't use them and you.

owe 18% on them. Yep. It's like because I have a car that. works and works well now. I'd rather. just pay it off than spend the money to. fix it. [snorts]. Uh what would it cost to fix and what. would it be worth after fix? [sighs]. I don't know what the market is on those. right now. That one has like 220,000. miles and I'd have to pull the engine. out and have a look at it. But How long. have you owed this? I bought that car in like 2019.

for so for four years. For almost five. years now. No, 2020 was when I bought it. You have been paying at basically 18%. interest rate. Yeah. Minimum monthly. payment of $94. Yeah. Okay. My soul just hurts. I just have a. little pain. That's all. My wallet feels it. All right. What do we own in insane. death? 12% on $4,39.

That one is a Subaru WRX. It's. an other car. Yep. What's this worth? Let me see a picture. Uh, I don't have one on hand of that. You have all these cars to get off to. and you don't even have a picture? I have one of the Corvette. I like the. Corvette. Why do you have this if you don't like. it? Uh cuz I did like it and the person. that sold it to me said they rebuilt the. engine and then within about three.

months of owning it, it blew a head. gasket. At the time I wasn't making you. take it to anyone to like inspect and. check out and be like, "Yo, so I have not blow a look at it.". Wait, this doesn't work either. No, because Subarus can blow head. gaskets in very odd ways and they aren't. necessarily detectable when they start. blowing. Um, so what they had done, the. previous owner had removed the uh. thermostat on it so that the coolant. would not blow out, but when the car got.

under boost, it would blow the coolant. out the reservoir. And so eventually it. just blew all the way open and car. stopped running. At the time I didn't. have the money to fix it or a garage. because I was living in an apartment. Dude, you're like addicted to this. hobby. Oh yeah. It's I say it would have been. more financially reasonable for me to. develop a hard drug addiction than to. get into cars. Gosh. Well, not encouraging that. [laughter].

Well, I probably wouldn't be making what. I make if I did that. So, 12.14% minimum monthly payment $141. That's a third car. Okay. This has Audi at the top of it. Yes. So, we have a fourth car. Yes. So, this one, hear me out. Hear me out. This one makes sense. because it's low miles. Um, for what it.

is, the price wasn't bad. And I actually. had two Corvettes, an 89 and an '08. But. I'm preparing for a move across the. country. So, I sold the 89. Um, what. is happening? This story evolves. evolves. And driving the '08, I was spending. about 600 a month on gas because I drive. about 2,000 miles a month because a. round trip to work is 60 miles. And so I was like, I need something more. fuel efficient. 600 a month is pretty.

good car payment and having something. that isn't in need of repair because. it's an older vehicle and a modified one. um would be better. And so I got this. car and I'm getting like 70 miles per. gallon on it. It's 37,000 miles. What's it worth? What's it worth? Uh I think about what a probably 22 23. Bought it for 255 out the door. Yeah. But it's at 13% interest. Yeah. So it's it's sure it's it slightly.

dipped and it's kind of maintaining, but. you're I mean you're losing more than. the S&P gains. Yeah. So it's just like me. And also why do I. have is this one operable? Yes, it sounds operable. Yes. So, one out of the four we have. Okay. So, you've done two things that. were quite bold today. One, you've. walked into the lines then of someone. who hates debt, and we have this. Two, you've walked in the lion of someone who. doesn't give a about cars and. honestly kind of dislikes them. So, I. was just like, "All right,

$24,000. $1,000 of interest stolen $1,500 of. interest stolen from you this year so. far. Minimum monthly payment of $55. What do you want? What do you want? What. do you want? You're on like. Yeah. scheduled payoff date 2029, the. end of this decade. The end of this. decade, of course. 13% interest rate. You're making my. heart pound. Like actually I can feel it. Oh my gosh.

Should we check what my heart rate is? Like I can it's like killing me. Like. I'm slightly shaking. Yeah. I'm at 108. I'm going, man. No kidding. A Jared card. Yeah. Who' you propose to? Um, I bought my previous girlfriend quite a.

lot of jewelry. on debt. Yeah. So, because it was like they do 12 months no. interest and I was like, I'll pay it. off. I didn't pay it off. Yeah. It's acrewing interest. And that's. why I like to finesse the system. I like. to do zero dollar things. It's great. You figure out what it takes to pay on a. minimum monthly basis in order to pay it. off before interested. and you do that. and you did not do that. So, you went. into debt for an ex, an ex that is no. longer here, right, in your life and you.

still essentially owe money for her. Yeah. When'd you break up? Uh, what's today? Sunday. No, dude. I'm sorry. It's okay. No, no, that sucks. It's life. It happens. It's life. If I didn't know it was so. fresh before I made. No, but you're good. I'm sorry. I'm not worried about it.

You have that strong outer core that. you're trying to present. I respect it. But like and when I get broken up with, dude, I'm like a mess for minimum three. months. It was a mutual thing. She needs time to. grow and she's not ready to be in a. relationship right now. So, we were. together for almost two years, but. well, you owe 5,123. on this card. You've made uh $85. payment, but $131 of interest recurring. That's the killer.

That's probably the worst card cuz that. card is like 30% APR and it's. killing me. $5,132. 24 is owed and uh $180 minimum monthly. payment. Uh a death interest rate. Yep. Let's. see. I can't find it. It's 30% on that one. Okay.

Gosh. So, this is just like never going. to be paid off in the way that we're. going about it. Yep. Uh personal loan for. um Okay. A personal loan for what? Uh that was when I moved. Um I didn't have the cash to pay the. security deposit in first month's rent. Why haven't you paid it off? Well, that's not just for first month's rent. First month's rent, unless unless it's. like a uh Okay, you opened it for. $5,000. First month's rent wasn't. $5,000. The reason I haven't paid that.

one off is because for whatever reason. it seems like they charge the interest. all at once with the loan. So I'm not. acrewing interest and I'm not losing any. interest by paying it off. It was. definitely more of a predatory company. The original loan was for three. Have you looked into the terms though. where it's cuz what what some can do is. they can show interest that is like. acrewing but if you pay it off if you. pay it off like that interest like won't. be hit in the end. But it may have been. in the situation. I can't see because.

this isn't really a statement. I remember reading the terms and I think. they said that the interest acred and. that it wasn't charged up front, but. I'll have to go back and see because I. thought it was odd when I looked at it. that it had been. What's the interest? I don't remember on that one. I can pull. it up and check though. It It's up there. though. Well, currently it's like in the 20s. Death. currently owe $2,293.92. with $127.

minimum monthly payment. Okay, [sighs] so we continue. Navy Federal Card. You owed $4,967. You made $122 minimum. monthly payment, which is the minimum. monthly payment, which is now 123. 12339. You purchased $85 of things. Why? Why?

And then new interest 73. Now you're. over the balance. You're over the credit. limit. You're over the credit limit. You're over the credit limit. So if. you're over the credit. I'm just saying the same thing over and. over. That's when I know I'm just dying. Available credit none. You're $3.94. over. It looked like you were going to say. something. Whenever I see that card go over the. limit, I pay it down.

But. that doesn't make sense. Well, why don't we just pay it down? Why do we Why do we go over the credit. limit? Um. Oh, I think it was over because of. interest. Like I buy it and then it acrus interest. and then at the end of the statement. it's over the limit. Buddy, [snorts] you're killing me. I'm.

like actually like shaking. It's I. haven't felt this way in a long time. It's just I'm so anxious for your. situation. And it's Uber Eats and it's. Uber Eats and it's Uber Eats. It's three. Ubering eats. I'm disgusted. [snorts] $700 in interest. loss this year so far and some fees as. well. It's Uber Eats. So what? Oh, you're lucky that the episode that you. know we're uploading the day of is the.

day that we're announcing the budgeting. course. Mhm. And you're going to need it, man. You're. going to need it. And I'm giving it to. you for free and I assigned to you as a. prescription. You are taking it, man. You're going through the hours. There is. It It is literally the best thing you. can do to change your life, man. I'd love to. You you need to you need to. people in your situation, you need this. We designed it specifically for you. Yeah. That's the reason I came because I. know it's it's like with the things I. want to do with the cars or even like. buying the Corvette, if I wasn't in.

debt, I could buy that car in. four or five months of saving if that. Yeah, man. And and now it's just I'm paying it for. forever almost. It feels like forever. It's. at 18%. Yeah. It's just I'm losing. hundreds every month to interest. It. sucks. You know what's unacceptable to someone. making $15,000 a year? Overdrafts. You didn't overdraft this. month, but you've overdrafted this year. so far.

So, I share rent. and the rent payment goes. And sometimes. my roommate tells me he's going to get. the money and the money doesn't come. So. it gets over. How often does that happen? And then how often does that happen? Way too often. Okay. So you know what happens? So you. have a buffer in your checking account. like an adult. Sucks that he does that. Y. uh and you you know Yeah. Maybe he's not. a roommate for the future. Okay. But if. you know what happens after a couple. times it's like, "Okay, we're going to.

have the buffer because we're not going. to pay a $30 overdraft fee.". That's what I started to do. I've just. did it because you only have $1,000 in. here. Um, that's enough to cover his. share of rent. and your share. Uh, not both, but I get another paycheck. before rent hits. So, I I always have enough. and no other automatic payments come out. after that. Um, I have a car payment, but I always make. sure I have enough to cover his share of.

rent and my share and what else I need. to cover. Um, and then he he pays me. when he pays me. And then what do you do. through here? You go to the vending. machine. And you go to the vending. machine. You're obsessed with the. vending machine. Cash apping out money. Vending machine. Cash apping out money. Uh what's 365 pay? Uh it's one of the uh they have like a. little food market at work. Food market. Food market. Um Boba Ttopia. Uh Boba. Yeah, Boba.

Topia. And I I I'm a for Boba. Not. when we have debt, my dude. Not when we. have four four car debts. Three of which. the cars are not even operable. Natural. bridge caverns. Great. Red rooster food. Natural bridge caverns. Cash app money. Zelon out money. Rooster food. Vending machine. Vending machine. Linds. express the the food court. Uberin.

[snorts]. Vending machine. Vending machine. Vending. But if we just if. Oh, you have such an opportunity to be. such an such a good position. It It. makes me so sad to see it being thrown. away right now. A place to shoot. It's. expensive. It's an expensive place to. shoot. Ammo costs money. Yeah. Yeah. Why are you just throwing. away money and ammo though when we have. that? It doesn't make sense. Logic is. just not there, man.

Uh vending machine. GrubHub, Wing Stop, Wing Stop, Rooster. Food, Waterburger, Uber Eats, Vending. Machine, Vending Machine, Amazon, a. firm. Great. Another thing in the mix. Oh, that's not uh debt. I use a firm's. high yield savings gives you like 4. point. So, you put a buck in there, some percent. Or is that. uh that was in the account. Okay. 4 what?

4 point. I can I think it's like 4.35. Use SoFi, dude. It's 4.6. Okay. Vending machine. Uh, diner. Sushi. Vending machine. Vending machine. Vending machine. You don't need to be spending that. money. You're killing me. You're killing. yourself. You're destroying your future. Ending balance in this other checking. account. Seven bucks. Yeah, that's not the one I use. I only. use that one to send money to it to pay.

the Navy Federal loans. Everything else. goes through my main checking. Everything except else except for this. Apple bill and the Chipotle and taking. money out of the ATM. Who knows where. that went? ATM fees and of course tolls. of which you do not need to take in. Texas. I live in Texas. I know you don't. need to take them. And Bob and Amazon. The toll roads a story actually. Um so I. sold a car um and left the license. plates on. Oh. Oh no.

The car never got reregistered. ever. And so I get a. toll letter and legally I'm still. responsible for it. And I tried. submitting a title transfer notice. and the car won't show up in the system. for whatever reason. And they also went. and ran a red light with it too. But and. they got caught in a red light camera.

You don't have to pay those. They can't come after you for them. They. can't send them to collections. They. don't affect your. red light cameras where. in San Antonio. They're legal in Texas. They are. But the contracts, they still. have contracts with the companies up. until I think like 2020. They can't legally pursue them though. They just hope that people pay. Yeah, that's it. And then the. Not even that, dude. Then Chick-fil-A.

and Pancakes. I thought that was it. And. then Apple Bill, Amazon, the the vending. machine. Vending machine. Chipotle. Pizza. Academy Sports. Uber. A place to. shoot. Again, $287. You can't afford to live. And you're. doing $287. A place to shoot. Then. another $130 a place to shoot. Vending machine. Vending machine. Apple. bill. It's a Mexican place. Apple bill. Amazon. Dude, you lied to me. I PUT.

MONEY THERE SO I can pay off my Navy. federal credit. First of all, your Navy. credit credit thing is over the limit. And number two, in there it says, "You. spending you spending you spending?" You. lied. Don't me. What's the point of care. if you're going to bull me? Why, dude? I'm sorry. Just why? I just feel like I always got to do. something. I got to go be busy. I don't. like being home. Why should you go on walks? go on like. runs or something.

That'd probably be a good idea. Do you have a dog? I do. I have two. Take them on walks. That's what I do. To. a dog park. That's doing something. That's nice. I take them to the dog park next to the. house. Um there's a. do that twice as much. in this half as much. Okay. Fidelity 3,000 bucks. Not super. exciting. It looks like it's within It's. for That one's for an HSA. Oh, okay. Cool. That's lovely. Yep.

And then the other one is the 401k. 4,000 bucks. So, yeah. So, okay. I'm glad you're getting. started. Yeah. There is You're going to hate. this. There is a 401k loan on that, though. Um, the reason I took that loan. out was because I anticipated to move. across the country because I had a. company that reached out to me and. wanted me to go work in Virginia. Um, and I need to get a trailer hitch and.

pay for U-Haul. Too much money. What's the interest rate on your 401k. loan on how much did you take out? 9% and two grand. 9%. 9%. 9%. So, the S&P 500's beat it by 1% this. year, if that's what you're even. investing in. for the 401k loan at 22. is disgusting.

It's disgusting. I feel the vomit ready. to projectile onto you because of how. disgusting this is. 9%. Your future, man. You're destroying it. You're destroying it. Oh, I'm scared. Okay. I don't want you to be a And we. constructed these rules to not be a up. You're breaking in breaking rule number. one immediately. Does that fit in the. budget? Absolutely not. Rule number two,

you need an emergency fund. Do you have. it? I didn't see it. Do you have any. money in savings? Keep $1,000 cash. Okay. You do not have an emergency fund. Great. Don't hold the credit card. balance. You know, you broke that. So, you broke one, two, and three. Stop. buying cars you can't afford. No, you're. getting them 18%. You can't afford that. My goodness. You broke immediately the. first four rules. Live someplace you can. actually afford. What's your portion of. rent? 750. That's incredible. That's incredible. You're doing great with work, too. So, that's great. [snorts] School, we don't. need to worry about that because you're.

doing great with work. You're not. self-employed. Fantastic. Subscriptions. I didn't see a bunch, but. you should cancel them if you have them. Okay. Want to know how to not die in the. Walmart floor? This is usually for like. crypto and like day trading and all that. crap, but you're doing a 401k loan. May. as well be broke. So, you're breaking. five rules of do not be a I don't want. you to be a you're heading down the. path. If you want your rules for not. being a up, you can sign up in the. description below. It's free. It's fun. I made it for fun. I don't.

like that you're breaking the rules. It's actually very upsetting. [snorts]. debt payments are only 14% of your. spending. You're like my monthly. payments are too big and I can't do. things. It's 14% of your spending. So, uh transportation total though that is. another 16% and that does go into debt. Bunch of eating out to eat 7.1%. where your necessary grocery shopping is. only 4.2%. So great unknown shopping. Amazon 5.4%.

[clears throat]. miscellaneous. It's the vending. machines. It's the taqua. It's anything. and everything else that you just don't. need. 8.3% that could be going towards. debt. So, so far that's 875. that could be going towards debt. That. is not necessary. 8.9% other large purchases. That's ATM. withdrawal. Who knows where that went? And Central Market, which is actually. groceries. I don't know why we put that. there. Uh, Central Market. It's an.

expensive way to do groceries. It's. basically the HV version of Yeah. Whole Foods. He's making some steaks for a date. Cool. Get some HB steaks. They're not as good. They're not as. good. Has better cuts. I don't know if she'll know the. difference. She does. Is that the one that broke up with you? Uh, it was mutual, but gave her some uh. But it's that one. Yeah. Gave her some HB stakes. She. noticed a difference. No offense to this.

or no offense to you. Looks like it. didn't make a difference. That was mean. I'm sorry, but. you're not wrong. I mean, call it how you see it. That's the only way I live life. So, we. have uh one, two, three, four, five, six, seven, eight of the most disgusting. debts I've ever seen. [snorts]. Right. Yeah. You're going to take that? I'm. sending it to you. I'm sending it to you. and you're gonna take that course, dude, because you need to change your life.

now. But I'm gonna help you put together. a rudimentary budget as we do on this. show. But is there even a point? I mean, that's honestly my question. I ask. people that sometimes I'm actually. curious. Is there even a point of making. you a budget? Just the way you've lived, man. It's just like we go get another. car. We got to go do this cuz I got to. go do something. It's just like if I. make you a budget, man, you've made a. budget before. You've never followed it. That's one of the reasons why we made. the thing. So you can actually we teach. people how to actually stick to it and. follow it. But. a lot of it is with the eating in terms.

of the budget. Um and going to the range. that's not in the budget. Those are the two categories I. overspend. But the past year I've paid. off a pretty significant amount of debt. How much? Um. you weren't putting anything extra on. this. I didn't see it. Not. on. We're going to the boom booms instead. Yeah. I can I can show you. So, I've. made $500 payment on that $1,500 loan on. the GTI. Um, last month it was like. right after.

and that's why we put it down to a,000, right? So, okay. What have you paid off? I last month I also paid off a $900. balance on a credit card. Um, I don't know if it was last month or. the month before that, but I paid off. like another $800. I had like two cards. with credit one that were totaled like. $1,300 together and then Aspire card. that was $900. So, you've you had even more debt. My. gosh, all of those off. You've put yourself into a situation. I. I can be happy about that. Um, we can be. happy about that.

Not to just go negative, but I will say. with the income you're doing and where. like 30 40% of your money was going and. the choices you're making, with the income you have, buddy, you. could have tripled what you did. Yeah. Tripled. You're extending your. situation. You're borrowing against your. 401k. You're preventing yourself from. living life. Yeah. Your portion of rent 750. And then car insurance I pay 300. The. insurance bill is like five.

or I pay 250. The insurance bill is 550. My roommate and I share insurance. So we. both. for car insurance. Yeah. Why? He drives your cars. No, it saves us both money. You're on them together? Yeah. Okay. Yeah. He has a car on it. The Corvette isn't insured right now. because it's just sitting in my garage. [snorts] Um, now he's insured and then he has a car. on the insurance. So, we just pay for. that. Rentals insurance.

Yeah. 16 something a month. It was. lemonade. Should be on one of the bank. statements. Your portion of utilities and internet. The utilities is included in rent. Wow. Um, San Antonio cheap. Well, it's three of. us in a house and it's pretty big house, but yeah, it's it's not too bad. Internet, uh 55 a month. Gas, uh 140. usually between 140 200 is what I spend.

Yeah. Any ongoing uh medical things that. you're paying for, prescriptions, anything we should put in the budget? Okay. Yeah. I've been trying to take steps in. the right direction and slowly been. doing that. No, I have a home gym. so I work out at home. I saw Planet Fitness in there though. Might be something you need. I need to go cancel that. Yeah. Okay. I just wasn't going to call it out cuz. I'm I'm like gym. I'm happy to put in. the budget.

Yeah. No, I just need to go cancel that. one. Groceries 300. Toilet paper. Anything else you need to. survive essentially? 100. Uh uh uh uh uh uh phone bill uh. just 122. Anything else you have to take care of. on a monthly basis? Do you mind if I pull up my financial? Obviously I have to add up your debts,

but yeah, go ahead. Let me [snorts] double check real quick. car insurance. bill. Phone bill is 127. Uh I have a subscription to you said. cancels. Okay. Uh no, you can put your subscription in your. toilet paper fund if you have anything. left over. That's essentially what I. allow. Then debt, no surprise. And it's all.

going up. Stupid cars. $1,584. Killing yourself, man. Yeah, I've been trying to take steps in. the right direction. It's just slowly. breaking bad habits that I've had since. I was 18 that just snowball. I'd sell what I can. Obviously, when it. comes to the car stuff, I would do all. that and try to do what you can, but. just cuz they're broken and there's a. lot of stuff, let's just put it in the. situation and let's just go from there.

But that would speed up the process. Yeah, absolutely. You do not need this stuff. $3,322. is what you need to survive. Um, we had income coming in at 7,644. Yep. Cool. Sounds about right. And this is why, again, you follow my. budget. Use the This is what I want you. to do, though. Um.

uh I want you to uh in the uh template. that we have that we're going to give. you uh in the budgeting course. I want. you to use that actually use that on a. monthly basis, man. Hold yourself. accountable and it's going to show you. things and you rate your priorities on. the items that you're spending in your. budget so you know what you can cut back. on things that aren't giving you. pleasure. Yeah. Pleasure. Uh but like. you know actual like happiness. It's. like a happiness skill. It's a really. good way to budget. I want you to do. that. I want you to follow it. And if. you put in these categories like the way. I said, man, I mean, dude, it's.

extra $4,322. a month, there's no no reason why you. should have this debt and to begin with, and there's no reason why it shouldn't. be paid off. Yeah, it's disgusting. First month, put half. of it towards that $1,000 that you. already put aside. Um, let's just call. let's just call it the end of this. month. Okay, cool. You have a onemon. emergency fund end of this month. starting fresh next month.

Volkswagen as you said paid off. and then pay off uh 401k loan and put. $1,000 to the personal loan. Okay. Okay. Month number three, step right up. paying off the rest of the personal loan. and putting $3,000 towards. WRX.

Month number four, finish WRX. Put $3,000 bucks towards Jared. Next month, put 2,000 uh um Are we on. month number six? I think it's five. I do have a question. I am saving for a move. Um, how much is the move going to be? And why are you moving? I have a job offer. How much are you going to make? Uh, same as I'm making now, just half.

the days. Where are you moving to? Virginia. Okay. Yep. Cost of living is going to be a. little bit higher. Y. Um, but I'm just. going to run a room in somebody's house. How much is the move? [sighs and gasps]. I'm thinking about just taking a 6x12. U-Haul and the car. So, really all I'll. have to pay for is the the new place cuz. the company's going to reimburse up to. seven grand. I can happen under seven grand. I just. need to have the money. You got the money. Okay,

cool. So, add two months for that. Add. two months at the beginning. So, we're. heading into five. We're so we're. heading into month number seven now. then. So, yep. do that first. and then I should have a pretty good tax. return this year as well. Okay. Um I'm getting a $4,000 credit for the. buying the Audi. Um because it qualifies. for used clean energy vehicles. It's electric. Um it's a plug-in hybrid, so I can get. 16 miles. Well, obviously put that towards the.

interal, but we're headed into month. number seven right now. Pay off the rest of Jared, 2,000 bucks, and then 2,000 bucks put towards Navy. Federal. Then the next month, pay off. Navy Federal with 3,000. Put a,000. towards uh the 2008 Corvette. [clears throat]. That time that's going to be around, let's just call it, and that's we're. headed into month number nine. Say. that's worth about 12,000. And you have about 5,000 bucks left over. on a monthly basis. Now, it's going to. take 2.4 months to pay off that.

So, let's just round up. Say we're. headed into month number 11. The Audi's. there. The interest is probably like. $20,000 left. probably about thousand. 20,000. divide that by about 5,400. Okay. And then that's about four months. So let's just say conservative.

conservative a year and a quarter you. should be able to pay it off. year and a. quarter and then what I need you to do. from there, your rent's going to be. more. So, let's just consider the 3,322. what you need to survive anyway because. your cost of living is going to go up. even though debt payments are going to. go down. Okay, times that by six. We need to get. let's call it $20,000 saved up for a. six-month emergency fund. 5,000 at that. time, $5,500. It'll take an extra three and a half.

months to do. So, again, let's just be. conservative. Let's call it a year and a. half. There is no reason why if you. actually, you know, grow up about this. and discipline yourself. A year and a half, man, and your life is. changed completely and you're 23 24. It's insane. 23 24 and you get to. 2324. And let's just use the average stock.

market return. going to 65. uh 64. Let's make it easy. 64. So. 40 years. Average stock market return from the. history of the United States 8%. Uh you already have 4,000 hours in the. stock market. It'll probably be like. 6,000 hours by that time just with the. contributions you're doing, whatever. Okay. According to the survey I ran, 33%. of you are not investing. So, I don't.

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you might max out your 401k. Uh, okay. I. could um with the new job, they're going. to let me work overtime and so I should. be able to hit somewhere between 130 to. 160,000 a year. Let's just say you're putting in $1,900. on a monthly basis, which is the minimum. you should do. You're retiring at $6.7. million. Yeah. $6.7 million or after inflation. I mean, that'll be after inflation about like. $3.3 million in today's money. That's.

incredible. $3.3 million following the. 3% rule. My goal is to retire by 45 and that's. part of why I wanted to come here. Um. Okay. Well, that would be $100,000 a. year for the rest of your life, but 45. Okay. Well, you're talking Okay. So, you're. talking a little more fire situation. Yeah. uh. with the. job I'm doing um and how young I am in. it and how. but you actually have to sacrifice and. pay off your debt first and get a fully.

funed emergency fund. Okay. So, what. what h how much do you want to make a. year to survive? What do you need to. make a year to survive in your mind. to retire or. a year pulling from your investments? I. think about 150. 150. I can't believe we're even having. this conversation cuz you're not even. close to being in the conversation of. fire. But I'm going to humor it. Okay. So, you need $5 million. And this is. regardless of what Dave Ramsey says, by. the way. Mhm. Because.

according to Dave, you could uh have 1.5 million. No, you. could have about 2 million bucks in uh. withdraw 8% a year cuz you'd be getting. 12% in your mutual funds, which. apparently he doesn't consider the. actual management fees on that. and then. he considers a little bit of inflation. But either way, the statistics that I. have uh using just a basic very basic. thing, if you retire for only 20 years, his plan's going to fail six or only.

succeed about 60% of the time. It's. going to fail 40% of the simulations. based on historic returns in the stock. market. But if you retire for 30 years. and you're going to be retired for more. than 30 years, his uh 8% withdrawal rate. fails. fail uh succeeds only 32% of the time. 30% 32% of the time. Now a. car loan I'd take. What? Sounds like a car loan I'd take. Okay. Yeah. So a 4% used to be the rule. that succeeds like 95% of the time.

People just want to be, you know, obviously safe and just want to hit that. 100%. 100% in order to hit that 100%. success rate. Uh using simulating uh all. historic returns in the United States, you got to do 3%. So 3% you need to get. to what did we say? 5 million bucks. Million. So 5 million bucks by when? 45. Yeah. Why am I even entertaining this? Cuz. right now this is so scary. Whatever. Okay. Let's say you you're done by 24. cuz you actually follow what I say. So. you have 21 years left. You need to get.

4.5. or five. You need to get to five. 7,000. or uh where was that? 7,750 is what you. need to contribute on a monthly basis, which is more than you make currently. So, I I don't know how you're doing it. unless you're working. more jobs. I'm picking up a second job. Um my. buddy's doing solar sales, which is. something I can do on my off days. Um but it's all taking hot [snorts].

leads through calls. Yeah. No, I would uh. he's been doing pretty well with that. How many hours a week are you going to. work in your new job? Um it's not You make your own schedule. How many hours a week are you going to. work? starting I'm probably going to do. 20 to 30 and depending on how well it. does. What is the job? It's uh basically sit take hot calls, hot leads um from people who are. inquiring. Is it commission based? Yeah. No, no, no, no, no. In your job you're.

moving for. How many hours a week are. you working? Um about 40 hours, but I work three or. four days, 12 hour shifts. Cool. Why don't you three or four days. why don't you find a similar job that is. less paying even and just go do that for. the other if you're doing fire. I can just pick up shifts. usually usually pick up work as many. hours if okay cuz we're talking about. fire normally I say okay get out of that. have a fully funded emergency fund and. live 50 30 20 50% on needs 30% on wants. actually living 20% on investing so you.

can retire but you're trying to fire if. you're trying to fire. man [clears throat] you're going to have. to continue the sacrifice for 21 years. You're essentially not. people fire at like a million, five, 2. million. You're trying to fire at 5. million in 21 years. So, you're going to. have to work your and you're honestly. not going to really live the next 21. years, which is. that's hard, man. That's really. difficult. But if that's what you want. to do, this is what you have to do. Yeah. With my current job, um.

I will most likely be a manager before. 30. And in the sector I'm going to be. working in management for bet on that. But. can make usually 200 to 250 a year. I hope so. I root for it. You're betting. on that. But. [snorts]. I don't know. You're 22. Yeah. So you don't You've been working since. 17. You've been working since 17. What? I love the golden like vision.

Optimistic. Brighteyed. Yay. Things never work out the way you're. going to think they're going to work. out. There's always going to be bumps in. the road. Absolutely. Uh so I wouldn't bank on that. I hope. you get it. That's great. And I. encourage you to shoot for that and make. that your goal and work do what's. necessary to do that. Just know that the next 20 if you want. to hit your actual goal, it's like your. needs need to be very minimal. you're. not going to really spend much if any on. fund and everything's going to go into.

investing because again you have to do. 105% of your current income. Yeah. To meet that goal. Mhm. For 21 years. That's hard. Either way, I'm glad that was it was a fun part of. the conversation and I'm glad we can at. least get there now. Oh, maybe the. market will outperform and you know that. could happen. Maybe I mean the average. S&P 500 return over the past decade has. been like 12%. Yeah. But the average. stock market return in the history of. United States has been like 80 8% 80%.

say 8%. So that's what I went off to be. a little more conservative. Yeah. But. either way, none of this is even a part. of a conversation because you head down. the path you are currently going down. and you're. I'm dying. Yeah. And you're working till. you die. And what if anything happens. and you're just settled to death? Then. you're going through bankruptcy. At. least you don't have student loans which. can't which wouldn't get forgiven. So, but. only having $1,000 is I don't know. It's. a scary situation. You keep blowing up.

your cars. You're just being immature. and irresponsible. And of a 22year-old, it's like, okay, kind of exc not. excusable, but at least at least. understandable. If you have the goals you said you have. and you want to go and get them, it's. time to grow the up, mature, be an. adult, be a big boy, and take control of. your financial situation for the first. time in your life, man. This is it. This. is your moment to change. Started making. a little progress. You should have been. making much more progress. Those.

spending statements were ridiculous and. they pissed me off. Borrowing against. your 401k, unacceptable. buying a car, taking on an 18% debt, blowing it up, and then doing it again. three more times. No. Fix it. Fix it. Any questions? Any final thoughts? I want to get the vet running. That's I want to put a new engine in it, which adds.

another two or three months. But what the how is that even possibly. on the priority list of what we just All. right. No, I'm I'm sorry. I'm sorry. I'm. done. I'm done. That's the fir I go. through this and we get through the how. to fire and all this stuff and the first. thing you give about is your Corvette. I'm done. Let's I'm done. Let's Let's. finish it. Well, we're done. We're done. That's That's I had to cut that. interview off. That That pisses me off. That pisses me off. If we go if I go.

through all that time and energy and. work and caring about someone and. wanting them to succeed, [music] they. immediately come. No, but this is what I. want at the end. A want an unnecessary. want, then [snorts]. that legitimately upset me. Hammer. financial score, spending a budget, obviously zero [music] out of 10. Debt, 401k loan, obviously zero out of 10. Emergency fund, there's $1,000. That's a. 1 out of 10. [music] Retirement, I. wanted to give it a higher score for his. age, but with the 401k loan brings it to. a 1 out of 10. Real estate, 0 out of 10. It's going to be a hammer financial.

score zero out of 10. Make sure to check. out all the resources linked in the. description below. They are what I use. or would use in specific situations. Thanks to all of [music] our Patreon. producers for making this episode. possible. If you want to participate in. an episode of Financial Audit and you're. able to make it to Austin, Texas, please. fill out an application in the survey. linked in the description below. You can. also send a link to your friends or. family who you think might be good to be. on the show. If you have any questions, you [music] can email casting at. caleophammer.com.