XYPN Live 2024 was good! The event marked the 10th anniversary of the XY Planning Network. It brought together many fee-only advisors and vendors from across the industry. In this article, I share some of my insights on the conference.

Half of American household spending was on housing and transportation in 2022. Almost all expenses increased until middle age and then fell. Healthcare was the exception which kept rising with age.

Benefit from Start, Start, Continue! This technique applies to many areas of life - including personal finance.

Rich is flashy. However, few things can destroy someone’s wealth faster than trying to look rich.

A lot of the focus has been on how much those with significant wealth own. However, what they own might be even more interesting! This article leverages data from the Federal Reserve to compare what households own at varying levels of wealth.

You know who could use some love? Future you! Many people receive their annual raise and bonus this time of year, making now a prime time to increase saving.

Do you even need a budget? I don’t budget. My wife and I evaluate expenses and then forecast. We do so for a bunch of reasons, including: a desire not to see expenses yo-yo with a restrictive budget, an opportunity to challenge every expense, and the ability to intentionally build the life we want.

I often meet people who keep way too little cash. They have great incomes - $100,000, $300,000, $500,000 a year, or more! However, they feel poor. Fortunately, many of them have significant investments! Having enough cash is like having good shocks. There are still bumps in the road. They just hurt less.

What are five great questions to ask yourself? 1) What do I want my money to accomplish? 2) How do I minimize lifetime taxes? 3) What if I’m injured? 4) How can education costs be reasonable? 5) Are my assets in the right location?

What are the hierarchy of expenses? Basic needs, required, autonomy, experience, and gift.

This article explores each in turn.

Want to build wealth? Here are 16 ideas!

Income: focus on superpowers, take calculated risks, catch free money, and be a lifelong learner.

Expenses: own long-term, cut hidden costs, bring lunch, and be intentional.

Protection: have an emergency fund, stay appropriately insured, shop around, and be kind.

Goals: plan well ahead, develop efficient systems, support others, and be ready.

How could you benefit from inertia?

There’s a powerful force called static friction. It takes more effort to get something moving than to keep it moving.

This concept applies to many things, including: scheduling Paid Time Off (PTO), contributing to retirement plans, saving raises, and the like!

I had the great fortune to attend the XYPN Live last week.

Michael Kitces asked me about my big takeaways.

They were all about mindset:

• Stephanie Bogan’s challenge to think bigger

• Michael Kitces’ closing keynote on scaling

• Adam Cmejla’s perspectives on growth and automation

Do you have the 3 T’s to manage finances well?

Those are:

• Time

• Training

• Temperament

Some people feel discouraged with their finances.

However, it’s not all doom and gloom!

Here’s where the “rule” of 72 comes in handy.

A 40 year old with $200,000 saved for retirement who expects to earn an 8% return might have:

• $400,000 by age 49,

• $800,000 by age 58, and

• $1.6 million by age 67.

Many people put off financial planning.

However, optimizing finances early can be impactful!

With an 8% annual return, $500 a month turns into about:

• $37,000 in five years,

• $91,000 in 20 years,

• $745,000 in 30 years,

• and $1.75 million in 40 years.

I took it as a sign when a few people recently asked me my taken on car buying.

Here are my quick thoughts:

1. Always know your best alternative.

2. Negotiate financing as well.

3. Come prepared.

4. Take care of yourself physically.

5. Get a newspaper.

There are essentially four types of spending:

• Needs - high on physical and low and psychological benefit

• Entertainment - high on psychological and low on physical benefit

• Societal - high on both psychological and physical benefit

• Addiction - low on both physical and psychological benefit

Of course, these are not mutually exclusive!

Combining finances can be hard!

Many people believe it’s either all or nothing.

However, that’s not the case!

Integrating finances is more like a dimmer switch than a binary light switch.

What worked in the past may not work in the future.

Change is like a current. Standing still takes effort. Making progress takes more.

Fortunately, most of life’s major changes happen every day!

Seek the counsel of those who have gone from where you are to where you want to go.