Making more money doesn't automatically solve your financial problems.
In this episode of The Budgetdog Breakdown, Brendan answers questions about Roth conversions after a job loss, what to do after maxing out retirement accounts, paying off a mortgage versus investing, and why high-income earners can still feel like they're barely getting ahead.
The conversation explores how a lower-income year can potentially create an opportunity for a Roth conversion, why financial planning needs to be based on individual goals, and how to think about balancing investing with debt payoff. Brendan also shares the reasoning behind paying off his own mortgage at 28 and how reducing personal financial risk gave him the flexibility to take a major entrepreneurial risk.
The episode also dives into the difference between tax preparation and proactive tax planning. For business owners and high earners, waiting until tax season may mean missing opportunities that could have been identified throughout the year.
Money isn't just about how much you make.
It's about having a system for what you do with it.
Episode Timeline and Highlights
00:00 Why wealthy people rely on systems
00:18 Roth conversions after a job loss
01:25 When converting pretax money to Roth can make sense
02:22 Alternatives to a Roth conversion
03:35 Using lower investment values strategically
04:13 What to do after maxing out retirement accounts
05:19 The 15% retirement investing framework
06:40 When to prioritize an HSA
07:04 When taxable investing makes sense
07:40 Paying off your mortgage vs. investing
08:18 Why Brendan paid off his mortgage at 28
09:11 Understanding risk
09:32 Investing before aggressively paying off debt
10:15 Leaving Deloitte to build Budgetdog
11:43 Managing risk before taking a leap
12:29 Why $250K can still feel like you're broke
13:52 The importance of financial systems
14:59 Making $350K without a tax strategy
15:17 Tax preparation vs. tax planning
16:40 Why not all CPAs provide the same service
17:33 What proactive tax planning looks like
18:44 Why business owners need proactive tax strategy
19:20 Final thoughts
Key Takeaways
• A lower-income year can potentially create Roth conversion opportunities
• Pretax-to-Roth conversions create taxable income
• Retirement planning should be based on your specific goals
• Maxing out tax-advantaged accounts doesn't mean you're finished
• Mortgage payoff and investing can both be valid strategies
• Managing risk is an important part of financial planning
• High income without a system can still lead to financial stress
• Tax preparation and tax planning are different services
• Business owners can benefit from proactive tax planning
• Your money needs a system, not just a higher income
Quotables
"Making more money doesn't automatically mean you're good with money."
"Rich people and wealthy people can manage their risk really well."
"Your income is no longer the issue. You don't have a system."
"Making more money isn't the same as building wealth."
The goal isn't simply to earn more.
It's to build a system that makes the money you earn actually work for you.
