He’s a gentle legend with a perfect G chord and a questionable grasp of target-date funds. We asked him for money advice anyway.
At 76, Taylor is still touring, still working, and still somehow confused about what a checking account does. He seems like the worst person to interview about retirement and therefore the only correct choice for MoneyHole’s first “serious” Q&A.
Surely, we thought, he could offer some guidance to millennials and Gen-Z readers struggling to afford groceries and rent in the same month.
The conversation takes place in Lenox, in a quiet writing room surrounded by gleaming Martin guitars. Through the window: a custom recording studio, built because, as he puts it, “the stonework in the house echoes like crazy.”
He’s wearing a flannel that costs more than our monthly health insurance but looks like it came from a 1979 rest stop. The tea is poured from what is, apparently, a $300 teapot. The tea is incredible. We will never own a teapot like this.
MoneyHole:
MoneyHole: James, thanks for sitting down with us today. Our readers are mostly millennials and Gen-Z folks in their twenties and thirties still trying to figure out how to build wealth in an economy that feels rigged against them. What’s your advice for someone just starting out?
James Taylor:
Begin with the room. Some rooms breathe; some rooms fight you. Too much glass and the money won’t resonate. Find warmth. A ceiling that forgives. When I was starting out…this would’ve been ’68, ’69….I was living in this little place in Cambridge. Terrible acoustics. Couldn’t hear myself think. So I saved up and got a better apartment. That’s step one. Get yourself into a room where you can hear the music and into your own soul.
MoneyHole:
Cambridge rent is $3,200 for a one-bedroom. People make like…$50k–70k.
James Taylor:
Per month? Get a roommate. Or a band. When I needed some peace and quiet, I borrowed a place in the Berkshires and wrote for an entire weekend in total isolation. That usually fixes it.
MoneyHole:
Does your friend still lend that Berkshire house for free?
James Taylor:
I own it now. So I don’t ask.
MoneyHole:
Let’s talk emergency funds: three to six months in cash is our typical recommendation at a minimum. Do you have one?
James Taylor:
Absolutely. I keep a backup Guild F-50 at Tanglewood, tuned and humidified. If the Martin misbehaves, I pivot. That’s liquidity.
JT’s Emergency Fund Rule: Always carry some extra strings and a granola bar. One fixes the guitar, the other fixes the man.
MoneyHole:
That is a guitar. I think. Not a savings account…Do you personally keep cash in a bank?
James Taylor:
My business manager does. I get quarterly statements on these heavy linen with perforated edges. I rarely open them. If something’s wrong, she calls.
MoneyHole:
For many people, a primary residence is the only wealth builder. You’ve got Lenox, and a place on the Vineyard.
JT:
June through September. The light is different on the water. Also the natural humidity keeps the guitars at 45% without trying. That alone will save you a fortune in humidifiers you don’t buy. Also, my grandson absolutely loves the sailboat.
MoneyHole:
Our readers are, largely, (if our Google Analytics data can be trusted) currently scraping together a $50k down payment before they get laid off from some fintech startup.
James Taylor:
I guess… Well, Carly helped a lot with that. She understood structures. Trusts, mortgages, how to leverage the catalog. She set up the publishing trust before anyone told us we needed one. Very sharp about that stuff.
MoneyHole:
So the advice is “marry Carly Simon”?
James Taylor:
(laughs) I mean, it sort of worked for me. But more seriously, surround yourself with people who think differently than you do. I’m a songwriter…I think in chord shapes and melodies. Carly thought in systems and numbers. That balance is crucial. You can’t do it all yourself.
MoneyHole:
Retirement math says you might need $2 million by 65 to retire comfortably. What do you think about that?
James Taylor:
Two million to retire? What are they, oil barons? All you need to retire happy is a loving family, and a small recording studio. Oh, and a guest suite in case Paul Simon wants to drop by for a weekend.
MoneyHole:
On the topic of account structures…Do you have a 401(k) or a Roth IRA?
James Taylor: There’s a Roth. Or a Ruth. I remember a Ruth in Williamstown. She makes really great sandwiches. Either way, it feels friendly.
MoneyHole: Any uh…asset tips for normal people?
James Taylor: Diversify? That’s what my guy always says. “Spread the assets.” I’ve got touring, publishing, sync royalties, the Christmas albums… those are worth their weight in gold.
MoneyHole: …Christmas albums?
James Taylor:
My version of “Winter Wonderland” paid for the studio we are sitting in right now. Spotify streams on that one have been great. The Norwegians love it for some reason.
MoneyHole:
Jesus…How much do they make annually?
James Taylor: I’m not allowed to know. Maybe… $60,000 a year in residuals? I don’t really look at the numbers I just forward them to my person, and she handles it.
MoneyHole:
Our readers don’t have Christmas albums.
James Taylor:
Well… could they just… you know… record one?
MoneyHole:
Probably not.
James Taylor:
Hm. That sucks. OH! Do any of them have songs in movies? That’s a great way to make a few extra bucks when your budget is in a jam.
MoneyHole:
No. They’re not you. Judging by our social followers, they mostly work in “customer success” or still live with their parents.
James Taylor:
That really complicates things. “Fire and Rain” was in Remember The Titans, twelve seconds of Denzel walking down a hallway. That alone pays the Chilmark property taxes.
MoneyHole:
On another topic…Lots of our readers have student loans at 9% interest. Pay down… or invest broadly?
James Taylor:
If the capo’s choking the neck, lower it. If the debt strangles the melody, pay it. If not, try a open jazz voicing and invest. Same song, kinder tuning.
(In Song, warmly) Winter, spring, summer or fall, all you gotta do is call… your mortgage broker. Ask if you can do a cash out refi or something if comps are decent in your ZIP.
James, on LIQUIDITY issues
MoneyHole:
Roth vs. Traditional for someone in the 22% bracket?
James Taylor:
I once played a freezing club in New Haven for three men who thought I was Cat Stevens. Got paid in lentil soup. That’s why I say…”Pay taxes when you’re in the small room, thank yourself when you’re on the Grammys again.”
MoneyHole:
Final thoughts?
James Taylor:
Tune down a half-step. Life softens and the chords don’t change. Keep a backup for anything you love. Keep people who think differently.
Your health is your true wealth. I mountain biked 12 miles this morning. And if Carole King offers livestock, say yes and figure the paperwork out later.
James Taylor tours this summer, including a three-night Tanglewood residency where lawn seats cost roughly one grocery run. He remains a luminous human who can voice-lead a D chord into tears and still has no earthly idea what a 401(k) glidepath is.
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