Afford Anything

#686: Rachel: Rachel is new to investing and has noticed the stock market being dominated by AI companies. She wants to make sure her portfolio is balanced without overexposing herself.Should she rethink her index fund strategy to protect against a potential AI bubble?

Sarah: Sarah just turned 65, owns her home outright, and has been relying on credit cards since losing her job last year. She’s weighing whether to claim Social Security now, pay off debt, remodel her home, or convert her traditional IRA to a Roth.How should she prioritize these major financial moves while balancing income, debt, and retirement accounts?

Anonymous “Julie”: This listener is on COBRA after her spouse took a federal buyout and is exploring starting a small business with her two young kids to teach them entrepreneurship.Will employer-provided health insurance fade away, and how can she test business ideas before fully committing?

Resources Mentioned:

Books: 

So Good They Can't Ignore You by Cal Newport

The E-Myth by Michael Gerber

Traction by Gino Wickman

The Lean Startup by Eric Ries

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#685: You're not an investor. You're a saver.

That's the first of 10 principles Cullen Roche shares in this conversation about building what he calls "the perfect portfolio."

Roche, the founder and chief investment officer of Discipline Funds, argues that when you buy stocks on the secondary market, you're not actually funding companies or making investments in the traditional economic sense. You're just swapping your cash for someone else's stock position – reallocating your savings.

This reframe matters because it changes your entire approach. Instead of trying to beat the market, you focus on the boring, prudent work of allocating your savings across different time horizons.

We walk through all ten of Roche's principles. He explains why you are your portfolio's worst enemy – not just because fear makes you panic-sell during crashes, but because FOMO during bull markets leads you to chase performance at exactly the wrong time.

He breaks down why diversification is the only free lunch in investing, why costs matter more than you think, and why real returns are the only ones that count after you strip out inflation, taxes, and fees.

Roche introduces some concrete strategies most people have never heard of.

The 351 exchange lets you swap concentrated stock positions into diversified ETFs without triggering immediate capital gains taxes.

The "defined duration" approach matches specific pools of money to specific future expenses—like pairing a six-month treasury bill with next year's bathroom remodel.

He also tackles the hardest allocation question: what to do with money earmarked for three to ten years from now. That awkward middle timeframe sits between "keep it in cash" and "put it in stocks," and Roche explains why traditional approaches like sixty-forty portfolios don't always work.

The conversation covers everything from why long-term bonds make terrible matches for long-term goals to why thinking in time horizons beats thinking in investment styles.

Timestamps:

Note: Timestamps will vary on individual listening devices based on dynamic advertising run times. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.

(00:00) Principle 1: you're a saver, not an investor

(04:48) Real wealth comes from direct business ownership

(06:43) Principle 2: you are your portfolio's worst enemy

(09:58) FOMO during bull markets vs fear during crashes

(12:43) Principle 3: beating the market is hard

(15:18) The 5 percent "fun money" allocation debate

(16:18) What to do when your position explodes

(17:18) The 351 exchange tax strategy explained

(20:28) Should you rebalance concentrated stock positions

(22:18) Principle 4: diversification is the only free lunch

(31:03) Gold and stock market both high simultaneously

(35:43) When diversification becomes diworsification

(40:03) Principle 5: the cost matters hypothesis

(44:23) HSAs, 401ks and unavoidable fee structures

(47:03) Why ETFs beat mutual funds on taxes

(51:03) Principle 6: real, real returns matter most

(1:00:58) Principle 7: risk is uncertainty of lifetime consumption

(1:06:18) Longevity risk and unpredictable healthcare costs

(1:13:03) Principle 8: asset allocation as temporal conundrum

(1:24:43) The 3-10 year allocation problem explained

(1:28:03) Principle 9: past performance doesn't predict future

(1:31:18) Principle 10: set realistic expectations, stay the course

Resources:

Cullin's website and newsletter: https://disciplinefunds.com

Grab the FREE handbook: https://affordanything.com/financialgoals

Share this episode: https://affordanything.com/episode685
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#684: Most people search for the perfect portfolio — the one allocation that works in every market, at every age, for every goal. This interview starts by explaining why that portfolio does not exist.

We talk with Cullen Roche, founder and chief investment officer of Discipline Funds, about why copying someone else’s portfolio can backfire, and why portfolio design works better when it starts with your own constraints instead of rules of thumb.

We walk through real portfolio models. The conversation begins with the classic 60-40 portfolio. You hear where it came from, how it held up during the Great Depression, and why it became so widely adopted. We also talk about its trade-offs — why it feels boring in strong markets and comforting in crashes, and how that emotional balance plays a role in investor behavior.

Next, we shift to a Buffett-style portfolio. You hear why the takeaway is less about stock picking and more about structure. The discussion covers why Buffett keeps a small allocation to cash-like assets, how that “dry powder” functions during downturns, and why psychological stability matters as much as returns.

The episode then turns to cash management. We talk about high-yield savings accounts, money market funds and Treasury bills. You hear how many cash products are built on T-bills, how banks capture part of the yield, and when managing cash directly may make sense. The concept of “T-bill and chill” comes up — along with when the extra effort may or may not be worth it.

Finally, the conversation zooms out to time horizons. We discuss why income from a job functions like a bond allocation, how that changes risk capacity when you are younger, and why the early years of retirement carry the most danger. The episode closes by explaining sequence-of-returns risk and why portfolios need to work not just on paper, but in moments of fear.

Resource:

Cullin's website and newsletter: https://disciplinefunds.com

Timestamps:

Note: Timestamps will vary on individual listening devices based on dynamic advertising run times. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.

(00:00) Intro 

(02:00) No perfect portfolio

(03:34) 60-40 portfolio starts

(06:38) 60-40 keeps calm

(08:00) Buffett portfolio basics

(12:11) Stocks vs cash fear

(13:34) T-Bill and Chill

(18:22) TreasuryDirect is clunky

(23:42) Income as bond proxy

(25:33) Bond tent buffer

(29:12) Sequence risk explained

(31:42) Early retirement mindset

(32:36) COVID panic calls

(42:49) Three-fund portfolio basics

(58:41) Get-rich-quick trap

(1:18:21) Risk parity and All-Weather

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#683: Candy now — or a toy later? You slide play money across the table and let your kid choose.

That moment kicks off this episode, where Dr. Stephen Day joins us to talk about building a “mini economy” at home. 

Dr. Day is the director of the Center for Economic Education at Virginia Commonwealth University. He also holds a PhD in social studies and economics curriculum and instruction. His work looks at how kids form money habits long before they deal with real paychecks, budgets, or credit cards.

We break down how a mini economy actually works. Kids have job titles tied to age-appropriate chores. They earn play money. They spend it at a small household store set up on the kitchen table. The store might sell candy, small toys, or privileges like extra screen time. Parents set the prices. Kids decide whether to spend right away or save for something bigger.

You hear how this plays out inside Day’s own house. A three-year-old takes on the role of “zookeeper,” feeding the cat and picking up stuffed animals. A seven-year-old creates a weekly plan that alternates spending and saving, using patterns she learns at school. A five-year-old chooses to donate part of his earnings instead of spending anything. The system stays the same. The choices vary by kid.

The conversation moves through childhood stage by stage. Early years center on routine, structure, and basic trade-offs. Elementary school becomes the key period for practice, when habits and norms take shape. Middle and high school bring longer planning timelines, more independence, and deeper conversations about work, contribution, and goals.

We also dig into questions parents ask all the time. Should kids get paid for chores, or should chores come with living in the house? Day explains how families can separate family work, paid jobs, and service work so kids understand why they are doing each task. Clear categories help avoid confusion about motivation and responsibility.

Busy schedules come up, too. Sports practices, travel, school events, and late workdays often knock chore systems off track. Day explains how vague expectations create conflict and why job titles and defined duties bring structure even during chaotic weeks.

Throughout the episode, the focus stays on practice, not lectures. Kids do not learn money by hearing explanations. They learn by earning, choosing, saving, spending, and living with trade-offs — all inside a system small enough to fit on a kitchen table.

Resource:

Book: How to Teach a Kid to Save https://amzn.to/4jVOtze

EconEdLink, a CEE program https://econedlink.org

Timestamps:

Note: Timestamps will vary on individual listening devices based on dynamic advertising run times. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.

(00:00) Intro

(02:00) Teaching kids money

(03:59) Mini economy basics

(06:20) Money skills by stages

(10:41) Starting at age three

(12:02) Cat job example

(16:08) Goods versus privileges

(17:27) Bugging versus choices

(18:11) Paying for chores

(20:22) Family job service

(24:56) Busy weeks and chores

(33:21) Low-consumption kid example

(39:17) Shared jobs and teamwork

(43:34) Exchange rate to dollars

(1:00:28) Investing, 529, compound interest

Share this episode with a friend, colleagues, your kid's teachers: https://affordanything.com/episode683
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#682: Grab the FREE handbook: affordanything.com/financialgoals

For 76 years, the British cycling team lost — every season, without exception. Then they changed how they approached improvement, focusing on tiny gains instead of dramatic overhauls.

In today's episode, we unpack how they became champions – and apply those same tactics to our financial life.

This episode originally aired in January 2025. It was our most popular episode of the year on Spotify.

You hear how the British cycling team used “aggregation of marginal gains” — tiny improvements like adjusting bike seats, improving sleep with custom mattresses, even repainting floors so dust was easier to spot.

Those details seemed trivial on their own. Over time, they added up to Olympic gold medals and Tour de France wins.

We apply the same logic to money. The episode lays out a full roadmap for the year, broken down by quarter.

Early weeks focus on foundations. You start by writing a short financial motivation statement, calculating your net worth, choosing one metric to track, and creating a spending decision catchphrase that forces trade-offs into the open.

Later weeks shift into action. You raise your savings rate by one percent at a time. You declutter physical items that cost money to store. You add a waiting period before purchases. You trim subscriptions, set up credit monitoring, commit to meal planning, and try a one-week spending fast to reset habits.

As the year progresses, the tweaks move into optimization. You plan for irregular expenses, build buffers for price shocks, automate goals, check tire pressure to save on fuel, and calculate the real cost of transportation.

You review investment fees, workplace benefits, insurance deductibles, and estate planning basics.

Toward the end of the year, the focus turns to fine-tuning and reflection. You map out major expenses for the next five years, create rules for handling market volatility, repeat your most effective tweak, and close the year by reviewing progress and setting intentions for 2026.

The episode frames the year as a steady climb.

Timestamps:

Note: Timestamps will vary on individual listening devices based on dynamic advertising run times. The provided timestamps are approximate and may be several minutes off due to changing ad lengths.

One week. One small move. No overhaul required. Just consistent attention, applied over time.

(00:00) British cycling team wins after 76 years

(02:07) Aggregation of marginal gains philosophy

(04:02) 52 tweaks roadmap for 2026

(08:01) Week 1: Write financial motivation statement

(09:32) Week 2: Calculate net worth

(11:06) Week 3: Pick one metric to track

(14:00) Week 4: Create spending decision catchphrase

(21:34) Week 11: One-week spending fast

(23:41) Week 12: Weather-strip home for efficiency

(31:14) Week 14: Adjust thermostat one degree

(39:30) Week 25: Learn obscure financial terminology

(40:20) Week 26: Create price tracking system

(43:22) Week 28: Check tire pressure

(44:33) Week 31: Plan annual seasonal expenses

(59:05) Week 40: Calculate transportation costs

(01:01:09) Week 41: Map five-year big expenses

(01:03:06) Week 42: Review investment expense ratios

(01:07:10) Week 45: Run housing numbers

(01:09:52) Week 49: Swap disposables for reusables

(01:10:22) Week 50: Create market uncertainty plan

(01:11:06) Week 51: Repeat favorite tweak

(01:11:40) Week 52: Celebrate financial progress

(01:12:03) Control inputs not outcomes

(01:14:09) Download free guide https://affordanything.com/financialgoals
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