1 00:00:01,840 --> 00:00:06,840 Speaker 1: Tonight, this history actually repeat itself, and more importantly, does 2 00:00:06,920 --> 00:00:10,639 Speaker 1: investor behavior. You're listening to Simply Money, presented by all 3 00:00:10,680 --> 00:00:14,640 Speaker 1: Worth Financial on Bob's sponseller along with Brian James. What 4 00:00:14,720 --> 00:00:18,680 Speaker 1: if the biggest investing mistakes in history all came down 5 00:00:18,720 --> 00:00:24,000 Speaker 1: to the same four words. This time is different. Tonight 6 00:00:24,040 --> 00:00:26,639 Speaker 1: We're going to walk through a century of market history 7 00:00:26,680 --> 00:00:30,440 Speaker 1: and what it means for your money today this segment, Brian, 8 00:00:30,560 --> 00:00:33,640 Speaker 1: this is right up your alley. Pull out that chat GBT, 9 00:00:34,000 --> 00:00:36,640 Speaker 1: run all your charts and grass and all the history 10 00:00:36,920 --> 00:00:40,199 Speaker 1: you love to pull up at a moment's notice and 11 00:00:40,320 --> 00:00:43,760 Speaker 1: put all this in historical context for us. Give us 12 00:00:43,760 --> 00:00:45,760 Speaker 1: a good history lesson, Brian. 13 00:00:46,640 --> 00:00:49,520 Speaker 2: I think this is extremely valuable stuff, especially for people 14 00:00:49,520 --> 00:00:51,920 Speaker 2: who are new to this. And my personal belief after 15 00:00:51,960 --> 00:00:54,680 Speaker 2: having done this for almost thirty years, is that nobody 16 00:00:54,760 --> 00:00:57,680 Speaker 2: is a real investor until they've seen a full market 17 00:00:57,720 --> 00:01:00,480 Speaker 2: cycle right, meaning all the way down and then all 18 00:01:00,520 --> 00:01:02,200 Speaker 2: the way back up, because we got to see what 19 00:01:02,240 --> 00:01:04,280 Speaker 2: it feels like. What does it feel like when my 20 00:01:04,480 --> 00:01:06,560 Speaker 2: own dollars right? It's one It's one thing to read 21 00:01:06,560 --> 00:01:09,319 Speaker 2: a headline scrolling across the bottom of my TV screen, 22 00:01:09,440 --> 00:01:11,559 Speaker 2: or you know, an alert on my phone that says 23 00:01:11,560 --> 00:01:14,720 Speaker 2: the market sucks today. But it's another thing entirely to 24 00:01:14,760 --> 00:01:16,680 Speaker 2: see what my four oh one K did, Bob, you 25 00:01:16,760 --> 00:01:18,440 Speaker 2: have something on the tire time to see it coming. 26 00:01:18,840 --> 00:01:20,840 Speaker 1: Yeah, this is a good time to share a story 27 00:01:20,880 --> 00:01:23,160 Speaker 1: I think I've shared maybe once before. 28 00:01:23,319 --> 00:01:24,520 Speaker 3: It fits here. 29 00:01:24,680 --> 00:01:24,880 Speaker 4: You know. 30 00:01:25,000 --> 00:01:28,920 Speaker 1: Back when my career started in the early nineteen nineties, 31 00:01:28,959 --> 00:01:30,119 Speaker 1: we were in the middle of that. 32 00:01:30,160 --> 00:01:31,119 Speaker 3: Huge tech run. 33 00:01:31,160 --> 00:01:33,800 Speaker 1: The Nasdaq was going up twenty five percent a year, 34 00:01:34,520 --> 00:01:38,840 Speaker 1: and maybe this older guy down the hall, he was 35 00:01:38,959 --> 00:01:42,480 Speaker 1: just a grizzled old veteran in this industry, and he 36 00:01:42,600 --> 00:01:45,760 Speaker 1: might have perceived, and I'd probably correctly Brian, that he 37 00:01:45,840 --> 00:01:49,040 Speaker 1: thought I might be getting a little cocky and arrogant about, 38 00:01:49,360 --> 00:01:52,400 Speaker 1: you know, hey, my ability to manage money. You know, 39 00:01:52,480 --> 00:01:55,680 Speaker 1: because let's trade in the middle mid nineties, a trained 40 00:01:55,760 --> 00:01:58,640 Speaker 1: monkey could have put people in these funds and gotten 41 00:01:58,720 --> 00:02:01,520 Speaker 1: twenty six, twenty seven, twenty eight percent a year. And 42 00:02:01,600 --> 00:02:05,040 Speaker 1: he politely and maturely called me into his office. And 43 00:02:05,080 --> 00:02:08,160 Speaker 1: I'll never forget these words, Brian. He said to me, 44 00:02:08,960 --> 00:02:13,120 Speaker 1: you won't know blank, and he used a or a 45 00:02:13,160 --> 00:02:16,920 Speaker 1: word that I won't mention him until you've managed a 46 00:02:17,000 --> 00:02:20,400 Speaker 1: client during a down market, and I stared at him, like, 47 00:02:20,720 --> 00:02:23,320 Speaker 1: what is that? Well, boy, I soon found out, but 48 00:02:23,360 --> 00:02:25,120 Speaker 1: please continue now that that's. 49 00:02:25,240 --> 00:02:27,200 Speaker 2: I told somebody my similar story when I was a 50 00:02:27,240 --> 00:02:31,880 Speaker 2: baby advisor meaning idiot. I originally I came up during 51 00:02:31,919 --> 00:02:34,919 Speaker 2: the original original Internet wave in the late nineties early 52 00:02:34,960 --> 00:02:37,440 Speaker 2: two thousands, and that's what people wanted, and I thought 53 00:02:37,440 --> 00:02:39,400 Speaker 2: that was my job, give the people what they want. 54 00:02:39,440 --> 00:02:41,840 Speaker 2: And I finally had an advisor, an older saying the 55 00:02:41,880 --> 00:02:43,760 Speaker 2: exact same story. And Dennis, if you're having to be 56 00:02:43,760 --> 00:02:45,800 Speaker 2: listening to this, thank you for launching me onto what 57 00:02:45,880 --> 00:02:48,959 Speaker 2: became a great career after that moment. But he basically said, hey, look, 58 00:02:49,000 --> 00:02:51,160 Speaker 2: you seem to have the chops to be a good advisor, 59 00:02:51,280 --> 00:02:53,120 Speaker 2: but if you keep going down this path, you're not 60 00:02:53,160 --> 00:02:55,160 Speaker 2: going to be an advisor at all. Good batter indifferent. 61 00:02:55,280 --> 00:02:57,040 Speaker 2: Sure enough, about two years later I figured out what 62 00:02:57,040 --> 00:02:58,639 Speaker 2: he was talking about. When the Internet hit and it 63 00:02:58,720 --> 00:03:01,120 Speaker 2: hit hard in two thousand and one, and so let's 64 00:03:01,120 --> 00:03:03,760 Speaker 2: talk about some more of those moments we're talking about. 65 00:03:03,800 --> 00:03:05,600 Speaker 2: You know, what does it feel like when we have 66 00:03:05,720 --> 00:03:07,880 Speaker 2: that come up and so we feel and we see this, 67 00:03:08,360 --> 00:03:10,800 Speaker 2: what really can happen in the market So first of all, 68 00:03:10,880 --> 00:03:13,079 Speaker 2: let's start with the big one. We'll go chronologically here 69 00:03:13,320 --> 00:03:17,680 Speaker 2: nineteen twenty nine, stocks only go up right the Roaring twenties, 70 00:03:17,760 --> 00:03:21,359 Speaker 2: massive economic growth, the Great Gatsby. Everything was wonderful. Stocks 71 00:03:21,360 --> 00:03:23,639 Speaker 2: were booming, and people truly had believed that we were 72 00:03:23,639 --> 00:03:26,600 Speaker 2: in this new era of prosperity where nothing bad could 73 00:03:26,639 --> 00:03:29,720 Speaker 2: ever happen again. And unfortunately we go through the cycle. 74 00:03:29,760 --> 00:03:32,440 Speaker 2: We always get back to this point because we don't remember. 75 00:03:32,639 --> 00:03:35,720 Speaker 2: But anyway, so the rules applied until they didn't anymore, 76 00:03:36,240 --> 00:03:38,240 Speaker 2: you know, and finally, you know, stocks had reached this 77 00:03:38,320 --> 00:03:41,680 Speaker 2: permanently high plateau and then it all fell apart, market crash, 78 00:03:41,720 --> 00:03:44,440 Speaker 2: we had the Great Depression. After that, years of recovery, 79 00:03:44,480 --> 00:03:46,920 Speaker 2: and then the lesson of that is that this was 80 00:03:46,960 --> 00:03:51,640 Speaker 2: the optimism about the system itself, meaning that we eventually 81 00:03:51,720 --> 00:03:55,160 Speaker 2: can recover. Even through something that serious, people still go 82 00:03:55,520 --> 00:03:58,119 Speaker 2: about their daily business. They still go and spend their money. 83 00:03:58,160 --> 00:04:01,320 Speaker 2: The money moves in a circle, and eventually things will 84 00:04:01,320 --> 00:04:03,400 Speaker 2: recover and move on. There's kind of no other option 85 00:04:03,520 --> 00:04:06,000 Speaker 2: because we really don't want to revert back to caves 86 00:04:06,000 --> 00:04:09,840 Speaker 2: and ammunition and spam you for our lifestyle. So eventually 87 00:04:10,080 --> 00:04:12,480 Speaker 2: we dust ourselves off, we pick ourselves up, and then 88 00:04:12,520 --> 00:04:13,080 Speaker 2: we move on. 89 00:04:14,400 --> 00:04:16,839 Speaker 1: And that brings us to the late nineteen nineties that 90 00:04:16,920 --> 00:04:20,080 Speaker 1: I just spoke about before. You know, quote unquote, well, 91 00:04:20,160 --> 00:04:23,080 Speaker 1: the Internet is going to change everything, and to be fair, 92 00:04:23,279 --> 00:04:26,960 Speaker 1: the Internet did change everything, but that didn't mean every 93 00:04:27,040 --> 00:04:29,720 Speaker 1: company with a dot com behind its name was a 94 00:04:29,760 --> 00:04:35,120 Speaker 1: good investments. We completely ignored valuations or earnings in that 95 00:04:35,600 --> 00:04:38,880 Speaker 1: in that period of time, profits literally did not matter. 96 00:04:38,920 --> 00:04:43,440 Speaker 1: It was all about potential growth, eyeballs, clicks, you name it. Brian, 97 00:04:43,520 --> 00:04:46,120 Speaker 1: I can remember a buddy of mine who's in the 98 00:04:46,200 --> 00:04:48,919 Speaker 1: venture capital business and m and a business called me 99 00:04:49,000 --> 00:04:52,240 Speaker 1: and said, hey, I got this can't miss business. They 100 00:04:52,279 --> 00:04:55,480 Speaker 1: were in the grocery delivery business. I can't even remember 101 00:04:55,800 --> 00:04:59,520 Speaker 1: the name of the company, but I said, okay, I'll throw. 102 00:04:59,360 --> 00:05:00,360 Speaker 3: Five grand at this. 103 00:05:00,600 --> 00:05:03,479 Speaker 1: Thankfully it was only five thousand dollars, which back then 104 00:05:03,600 --> 00:05:05,840 Speaker 1: was a lot of money for me, because that five 105 00:05:05,880 --> 00:05:10,360 Speaker 1: thousand dollars literally disappeared within about four months. Fast forward 106 00:05:10,360 --> 00:05:14,320 Speaker 1: today that it's a great concept home delivery of groceries. 107 00:05:14,320 --> 00:05:17,760 Speaker 1: But guess who mastered that business, Good old Kroger right 108 00:05:17,800 --> 00:05:22,880 Speaker 1: here at Cincinnati. So again, you know, this time is different. 109 00:05:22,920 --> 00:05:23,200 Speaker 3: Thing. 110 00:05:23,720 --> 00:05:27,839 Speaker 1: It doesn't apply to everything. Bubbles burst, they always burst. 111 00:05:28,160 --> 00:05:33,080 Speaker 1: The NASDAC back in the late nineties plunged nearly eighty percent. Brian, Boy, 112 00:05:33,200 --> 00:05:35,040 Speaker 1: what a lesson we all learned back then. 113 00:05:35,440 --> 00:05:37,640 Speaker 2: Yeah, and I think that that grocery start, that's interesting 114 00:05:37,640 --> 00:05:40,240 Speaker 2: because it makes it because the now it's commonplace, right, 115 00:05:40,279 --> 00:05:42,080 Speaker 2: that happens all over the place now. But it sounds 116 00:05:42,120 --> 00:05:44,240 Speaker 2: like when this when you were involved in it, when 117 00:05:44,279 --> 00:05:45,800 Speaker 2: when your friend was involved in it was just too 118 00:05:46,120 --> 00:05:48,800 Speaker 2: early for its time. The general public wasn't ready to 119 00:05:48,839 --> 00:05:50,960 Speaker 2: sign on to it. And you know, I think a 120 00:05:51,000 --> 00:05:53,560 Speaker 2: lot of that kicked in COVID had an impact on this. 121 00:05:53,839 --> 00:05:55,400 Speaker 2: You and I could have been doing, you know, with 122 00:05:55,720 --> 00:06:00,040 Speaker 2: a zoom calls with our clients twenty years ago. The 123 00:06:00,080 --> 00:06:02,480 Speaker 2: technology was there, but people weren't ready to accept it. 124 00:06:02,520 --> 00:06:05,400 Speaker 2: Now we struggle sometimes. I prefer to meet in my 125 00:06:05,440 --> 00:06:07,440 Speaker 2: office if we can. I just think it's more fun, 126 00:06:07,520 --> 00:06:11,040 Speaker 2: and you know, it's a deeper meeting. But some people 127 00:06:11,160 --> 00:06:12,640 Speaker 2: just want to you know, I don't want to make 128 00:06:12,640 --> 00:06:14,120 Speaker 2: the trip across town. I want this to be quick, 129 00:06:14,160 --> 00:06:16,359 Speaker 2: get it over with. That kind of thing. Now that 130 00:06:16,400 --> 00:06:17,040 Speaker 2: people are. 131 00:06:16,960 --> 00:06:19,280 Speaker 3: Used to it, it's it's. 132 00:06:18,800 --> 00:06:21,159 Speaker 2: Truly you know the market is ready for it, and 133 00:06:21,200 --> 00:06:23,600 Speaker 2: therefore we're doing half our calls on Zoom nowadays. 134 00:06:23,600 --> 00:06:24,599 Speaker 4: So good bed and different. 135 00:06:24,640 --> 00:06:26,039 Speaker 2: It's not a bad thing, but it's just if the 136 00:06:26,040 --> 00:06:29,080 Speaker 2: market's not ready, it's not ready. So let's let's keep 137 00:06:29,080 --> 00:06:31,599 Speaker 2: talking about the different what will the down times have 138 00:06:31,680 --> 00:06:34,200 Speaker 2: looked like? So six seven this came from you know, 139 00:06:34,440 --> 00:06:36,360 Speaker 2: they ain't making any more on of it. We're talking 140 00:06:36,360 --> 00:06:39,200 Speaker 2: about real estate. This one hits closer to home for 141 00:06:39,240 --> 00:06:42,240 Speaker 2: a lot of people. No pun intended there, certainly, you know, 142 00:06:42,640 --> 00:06:45,680 Speaker 2: the assumption is that home prices just never come down nationally. 143 00:06:45,720 --> 00:06:47,640 Speaker 2: They might plateau for a little bit and said still 144 00:06:47,640 --> 00:06:49,360 Speaker 2: for a while, but they never go down. So people 145 00:06:49,360 --> 00:06:52,360 Speaker 2: were buying second homes, third homes. Interest rates were low, 146 00:06:52,480 --> 00:06:55,240 Speaker 2: So we're taking a lot more leverage assuming that this 147 00:06:55,400 --> 00:06:56,760 Speaker 2: was just going to things are just going to keep 148 00:06:56,800 --> 00:07:00,600 Speaker 2: moving up. Different asset, those same psychology, right, So we're 149 00:07:00,600 --> 00:07:02,839 Speaker 2: simply we're throwing money at something that has done well 150 00:07:02,880 --> 00:07:05,000 Speaker 2: recently on the assumption that it's just going to continue. 151 00:07:05,040 --> 00:07:08,520 Speaker 2: That's that's something called recency bias. Whatever happened most recently 152 00:07:08,880 --> 00:07:11,080 Speaker 2: must be they must be the gospel truth. So let's 153 00:07:11,080 --> 00:07:13,400 Speaker 2: continue to follow that then, of course we had two 154 00:07:13,480 --> 00:07:17,400 Speaker 2: thousand and eight global financial Crisis, the Great Recession. Banks 155 00:07:17,400 --> 00:07:20,400 Speaker 2: were failing, a lot of wealth was destroyed, especially for 156 00:07:20,440 --> 00:07:24,640 Speaker 2: people who were over concentrated in real estate. Heaven forbid overleveraged. 157 00:07:24,680 --> 00:07:26,360 Speaker 2: So not only did the did the value of their 158 00:07:26,360 --> 00:07:29,400 Speaker 2: investments fall, the banks came calling for their money. And 159 00:07:29,440 --> 00:07:31,600 Speaker 2: then all of a sudden we had people declaring bankruptcy. 160 00:07:31,680 --> 00:07:34,480 Speaker 2: And then we had, you know, seemingly nice neighborhoods. You 161 00:07:34,520 --> 00:07:37,280 Speaker 2: had all these abandoned homes with weeds growing up on 162 00:07:37,320 --> 00:07:39,880 Speaker 2: the porches and all that stuff that was over confidence 163 00:07:39,960 --> 00:07:43,080 Speaker 2: in safety meaning you know this they ain't making any 164 00:07:43,080 --> 00:07:45,120 Speaker 2: more of it, got a little too big for its bridges. 165 00:07:45,160 --> 00:07:47,920 Speaker 3: I think, well, and I can remember people. 166 00:07:48,040 --> 00:07:50,200 Speaker 1: You know, this is when you could do a you know, 167 00:07:50,680 --> 00:07:52,640 Speaker 1: you could get money, if you could fog a mirror, 168 00:07:52,640 --> 00:07:55,240 Speaker 1: you could get a loan. And people were literally borrowing 169 00:07:55,320 --> 00:07:59,120 Speaker 1: money to buy condos that were being built in Florida 170 00:07:59,200 --> 00:08:02,960 Speaker 1: and were literally flipping them before the condo was even sold. 171 00:08:03,000 --> 00:08:05,040 Speaker 3: That's how quickly people. 172 00:08:04,720 --> 00:08:07,920 Speaker 1: Were turning money over, you know, using leverage money. And 173 00:08:08,000 --> 00:08:10,520 Speaker 1: it all worked great until the music stopped. 174 00:08:10,720 --> 00:08:13,400 Speaker 3: You know. Let's fast forward to twenty. 175 00:08:12,960 --> 00:08:16,760 Speaker 1: Twenty one, and then we got into SPACs, crypto meme stocks. 176 00:08:17,200 --> 00:08:19,440 Speaker 3: You know, this is when Reddit took off. 177 00:08:19,720 --> 00:08:22,640 Speaker 1: Game stop. You know, this is coming out of COVID. 178 00:08:22,680 --> 00:08:25,360 Speaker 1: We had a bunch of people in their basements thinking 179 00:08:25,400 --> 00:08:27,720 Speaker 1: they were stock traders, and to their creit, a lot 180 00:08:27,720 --> 00:08:30,320 Speaker 1: of people made a lot of money by running up 181 00:08:30,360 --> 00:08:34,440 Speaker 1: these stocks intra day by huge amounts of money, and 182 00:08:35,000 --> 00:08:39,000 Speaker 1: that stuff like that works sometimes for a short period 183 00:08:39,040 --> 00:08:42,200 Speaker 1: of time. And just like this whole leveraging to buy 184 00:08:42,280 --> 00:08:45,720 Speaker 1: condo things, when the music stops, the last person that 185 00:08:45,800 --> 00:08:48,920 Speaker 1: doesn't have a chair to sit in can really get hammered. 186 00:08:48,960 --> 00:08:51,679 Speaker 3: And that's what happened here in the early two thousand eight. 187 00:08:52,000 --> 00:08:54,040 Speaker 2: You just said a word that that that rose a 188 00:08:54,080 --> 00:08:56,240 Speaker 2: flashback and this wasn't that long, only five years ago. 189 00:08:56,280 --> 00:08:59,160 Speaker 2: But SPACs, this was they were all the rage in 190 00:08:59,200 --> 00:09:02,360 Speaker 2: twenty twenty one. Sectial Purpose Acquisition Company, these were these 191 00:09:02,400 --> 00:09:05,600 Speaker 2: companies and they still exist. There's still reasons to do this. 192 00:09:05,720 --> 00:09:09,760 Speaker 2: But when the hype hit hard, it was when we 193 00:09:09,800 --> 00:09:12,560 Speaker 2: basically felt like we were bulletproof shortly prior to the 194 00:09:12,559 --> 00:09:13,440 Speaker 2: COVID crisis. 195 00:09:14,120 --> 00:09:14,960 Speaker 3: And so what a. 196 00:09:15,000 --> 00:09:18,360 Speaker 2: SPAC was, it doesn't didn't have any real business operations. 197 00:09:18,360 --> 00:09:20,640 Speaker 2: At its formation, it was just a bunch of people 198 00:09:20,760 --> 00:09:22,920 Speaker 2: or other companies saying, we are going to create a 199 00:09:22,960 --> 00:09:25,280 Speaker 2: company and we might do something with it. Investors went 200 00:09:25,320 --> 00:09:28,880 Speaker 2: good enough for me and started flinging money at it. 201 00:09:28,960 --> 00:09:31,240 Speaker 2: Then after it has raised those dollars, it would then 202 00:09:31,280 --> 00:09:33,520 Speaker 2: look for a private company to acquire. This is where 203 00:09:33,520 --> 00:09:37,800 Speaker 2: we got some of these were buying non fungible tokens NFTs. 204 00:09:38,200 --> 00:09:41,120 Speaker 2: Back when we were again feeling too bulletproof. We were 205 00:09:41,200 --> 00:09:44,800 Speaker 2: using SPACs to schedule IPOs for companies that didn't exist, 206 00:09:44,920 --> 00:09:48,400 Speaker 2: certainly didn't have any products, didn't have any profits, but 207 00:09:48,600 --> 00:09:52,199 Speaker 2: were being set up by people with seemingly good financial reputations, 208 00:09:52,200 --> 00:09:54,520 Speaker 2: which again at that point was good enough for the 209 00:09:54,559 --> 00:09:57,880 Speaker 2: investing public. So sorry, you just gave me fleshback of 210 00:09:57,880 --> 00:10:01,160 Speaker 2: how nuts that got back then. But so one more 211 00:10:01,200 --> 00:10:04,160 Speaker 2: story here, let's talk about let's go global. So Japan. 212 00:10:04,240 --> 00:10:06,280 Speaker 2: We had an asset bubble of Japan in the eighties, 213 00:10:06,520 --> 00:10:08,960 Speaker 2: So the story was simple back then, really really powerful. 214 00:10:09,000 --> 00:10:11,480 Speaker 2: I remember the cover of Time magazine or Newsweek or 215 00:10:11,520 --> 00:10:13,200 Speaker 2: one of them had Japan inc. 216 00:10:13,240 --> 00:10:14,720 Speaker 4: And I remember I think I was in about. 217 00:10:14,520 --> 00:10:16,360 Speaker 2: The sixth grade, and I was completely confused by that 218 00:10:16,400 --> 00:10:17,880 Speaker 2: because I didn't know how the world worked, but I 219 00:10:17,960 --> 00:10:21,000 Speaker 2: knew Japan wasn't a company, It's a country. So but 220 00:10:21,120 --> 00:10:23,600 Speaker 2: that's the way it was being taken. Japan was taking 221 00:10:23,640 --> 00:10:27,160 Speaker 2: over the global economy at that time. Japanese companies were dominating. 222 00:10:27,200 --> 00:10:30,760 Speaker 2: The economy was just absolutely booming. Investors around the world 223 00:10:30,800 --> 00:10:33,360 Speaker 2: started to think, Okay, this must not just be a cycle, this. 224 00:10:33,280 --> 00:10:34,160 Speaker 3: Is a permanent shift. 225 00:10:34,200 --> 00:10:37,560 Speaker 2: I guess we're all going to follow the Japanese business 226 00:10:37,600 --> 00:10:39,880 Speaker 2: processes and things, and that showed up in the numbers. 227 00:10:40,280 --> 00:10:44,600 Speaker 2: Japanese socks swored, real estate prices exploded, and even at 228 00:10:44,600 --> 00:10:47,800 Speaker 2: one point the land underneath the Imperial Palace in Tokyo 229 00:10:47,920 --> 00:10:51,640 Speaker 2: was worth more than all the real estate in California combined. Right, 230 00:10:51,720 --> 00:10:54,160 Speaker 2: So think how this is forty years ago, So think 231 00:10:54,160 --> 00:10:56,520 Speaker 2: about what that means now. The real estate in California 232 00:10:56,559 --> 00:11:00,160 Speaker 2: is famous for being really, really expensive. Well, there were 233 00:11:00,240 --> 00:11:02,360 Speaker 2: chunks of Japan that were more worth more than all 234 00:11:02,360 --> 00:11:03,280 Speaker 2: of it during this time. 235 00:11:03,800 --> 00:11:07,320 Speaker 1: So obviously I'm a little older than you, so I 236 00:11:07,320 --> 00:11:09,640 Speaker 1: can remember I was in high school in college in 237 00:11:09,679 --> 00:11:12,959 Speaker 1: the nineteen eighties, and I vividly remember that whole japan 238 00:11:13,080 --> 00:11:15,760 Speaker 1: ink thing and back then you know, this is when 239 00:11:16,160 --> 00:11:20,240 Speaker 1: Honda vehicles became ubiquitous everywhere. No one wanted to buy 240 00:11:20,240 --> 00:11:22,760 Speaker 1: an American car. It was, you know, the only thing 241 00:11:22,800 --> 00:11:25,760 Speaker 1: that was worth anything was a Japanese car. Everybody was 242 00:11:25,840 --> 00:11:28,480 Speaker 1: drinking the kool aid on this, and it was Japan, Japan, 243 00:11:28,640 --> 00:11:32,640 Speaker 1: Japan until their market collapsed in the early nineteen nineties. 244 00:11:32,920 --> 00:11:36,600 Speaker 1: And here's the part that really matters. The japan market 245 00:11:36,800 --> 00:11:40,800 Speaker 1: didn't just recover in a few years. The Japanese stock 246 00:11:40,920 --> 00:11:44,760 Speaker 1: market took decades to come back, and in some ways 247 00:11:44,800 --> 00:11:48,600 Speaker 1: it's still fully hasn't regained you know, its peak from 248 00:11:48,760 --> 00:11:50,200 Speaker 1: back in the nineteen eighties. 249 00:11:50,240 --> 00:11:51,319 Speaker 3: So you know, put a. 250 00:11:51,320 --> 00:11:54,679 Speaker 1: Rimit around this, this whole story here, Brian, And what 251 00:11:54,800 --> 00:11:57,640 Speaker 1: are the lessons we need to learn from all this history? 252 00:11:57,800 --> 00:11:59,560 Speaker 2: Yeah, I think this is going to come as a shock. 253 00:11:59,600 --> 00:12:01,680 Speaker 2: These are just different stories with the same lessons. So 254 00:12:01,720 --> 00:12:04,880 Speaker 2: even the strongest trends and the strongest economies can reverse 255 00:12:04,880 --> 00:12:06,760 Speaker 2: and that includes right here in the good old US 256 00:12:06,760 --> 00:12:09,840 Speaker 2: of A. When they do, those consequences can last far 257 00:12:09,920 --> 00:12:12,400 Speaker 2: longer than we expect. Right, we all think we're bulletproof, 258 00:12:12,600 --> 00:12:14,480 Speaker 2: and we all think that that first step back was 259 00:12:14,520 --> 00:12:17,560 Speaker 2: somehow a mistake or an aberration. But it's just life. 260 00:12:17,600 --> 00:12:21,280 Speaker 2: The market does pull back. Whenever we get slightly less 261 00:12:21,280 --> 00:12:23,160 Speaker 2: confident than we were the day before. The market is 262 00:12:23,200 --> 00:12:24,720 Speaker 2: going to pull back a little bit. It's something we 263 00:12:24,760 --> 00:12:28,800 Speaker 2: need to anticipate and understand how we might react to it, 264 00:12:29,000 --> 00:12:30,679 Speaker 2: but not actually react to it. 265 00:12:31,320 --> 00:12:32,440 Speaker 3: Here's the all Worth device. 266 00:12:32,640 --> 00:12:37,079 Speaker 1: History may change, but unfortunately sometimes. 267 00:12:36,320 --> 00:12:38,840 Speaker 3: Investor behavior doesn't. 268 00:12:39,440 --> 00:12:42,199 Speaker 1: They are about one hundred thousand taxpayers in the tri 269 00:12:42,320 --> 00:12:45,080 Speaker 1: State who might be able to get some money back 270 00:12:45,120 --> 00:12:47,920 Speaker 1: from the IRS. And we're not talking about just your 271 00:12:47,960 --> 00:12:51,400 Speaker 1: annual tax filing. We'll explain next. You're listening to Simply 272 00:12:51,400 --> 00:12:54,160 Speaker 1: Money presented by all Worth Financial on fifty five krc 273 00:12:54,720 --> 00:12:59,240 Speaker 1: B talk station. They're listening to Simply Money presented mind 274 00:12:59,320 --> 00:13:01,520 Speaker 1: all Worth Thine to a Lumbob spond seller. 275 00:13:01,280 --> 00:13:02,880 Speaker 3: Along with Brian James. 276 00:13:03,200 --> 00:13:06,360 Speaker 1: Straight ahead of six forty three, David is debating whether 277 00:13:06,400 --> 00:13:09,840 Speaker 1: to take Social Security at age seventy. Barbara wants her 278 00:13:09,880 --> 00:13:13,160 Speaker 1: dividends to act like a paycheck, and Greg is trying 279 00:13:13,200 --> 00:13:16,600 Speaker 1: to stay ahead of fifty thousand dollars worth of required 280 00:13:16,640 --> 00:13:20,680 Speaker 1: minimum distributions. He says he doesn't even need We'll tackle 281 00:13:20,720 --> 00:13:24,560 Speaker 1: all of this and more straight ahead. If you did 282 00:13:24,600 --> 00:13:27,120 Speaker 1: not file a tax return a couple of years ago, 283 00:13:27,320 --> 00:13:30,360 Speaker 1: you might want to take a second look because you 284 00:13:30,400 --> 00:13:34,000 Speaker 1: could literally be leaving some significant money on the table. 285 00:13:34,040 --> 00:13:35,559 Speaker 3: Brian, this is an interesting one. 286 00:13:36,559 --> 00:13:39,360 Speaker 2: So the IRS is saying that more than one point 287 00:13:39,360 --> 00:13:42,720 Speaker 2: two billion dollars in refunds just from twenty twenty two 288 00:13:42,720 --> 00:13:45,440 Speaker 2: are still uncleaned. That's one point two billion. I didn't 289 00:13:45,440 --> 00:13:46,920 Speaker 2: say million, I said billion with a B. 290 00:13:47,760 --> 00:13:48,400 Speaker 3: Here's the kicker. 291 00:13:48,480 --> 00:13:51,440 Speaker 2: One point three million Americans maybe entitled to that money, 292 00:13:51,440 --> 00:13:56,360 Speaker 2: including ninety four thousand taxpayers in Ohio, Kentucky, Indiana, and 293 00:13:56,600 --> 00:14:00,400 Speaker 2: possibly I'd say likely, including some people listening me say 294 00:14:00,440 --> 00:14:02,760 Speaker 2: these words right now. So this isn't one of these 295 00:14:02,800 --> 00:14:04,880 Speaker 2: get to it when you can situation. There is a 296 00:14:04,920 --> 00:14:07,520 Speaker 2: hard deadline, right the IRS isn't going to come and 297 00:14:07,559 --> 00:14:10,240 Speaker 2: deliver this money to your front porch. You usually have 298 00:14:10,280 --> 00:14:12,880 Speaker 2: about three years to go claim your tax refund, so 299 00:14:12,920 --> 00:14:15,800 Speaker 2: that means for twenty twenty two, your time is now. 300 00:14:15,800 --> 00:14:17,120 Speaker 2: You've got a couple weeks left to do it. That 301 00:14:17,120 --> 00:14:19,440 Speaker 2: window is going to close on April fifteenth, which is 302 00:14:19,480 --> 00:14:22,240 Speaker 2: three years after the tax deadline of the twenty twenty 303 00:14:22,240 --> 00:14:24,400 Speaker 2: two tax Here if you miss it you miss out, 304 00:14:24,440 --> 00:14:27,880 Speaker 2: the money's gone, no extension, no second chances, goes straight 305 00:14:27,920 --> 00:14:30,120 Speaker 2: to the US Treasury, who will spend it in an 306 00:14:30,160 --> 00:14:34,760 Speaker 2: extremely responsible manner. I'm sure Bob, Well, Brian, as. 307 00:14:34,640 --> 00:14:38,400 Speaker 1: You shared this, Joe Strecker, our executive producers, literally whispering 308 00:14:38,680 --> 00:14:41,000 Speaker 1: in my headphone saying, Hey, for all these people that 309 00:14:41,040 --> 00:14:43,640 Speaker 1: are too lazy to follow that return, he's willing to 310 00:14:43,680 --> 00:14:46,560 Speaker 1: do it for you and split the refund. 311 00:14:46,640 --> 00:14:47,680 Speaker 3: That's quite a deal. 312 00:14:48,200 --> 00:14:51,160 Speaker 1: Call Joe Strecker if you're interested. This is a win 313 00:14:51,240 --> 00:14:54,200 Speaker 1: win situation for everybody. But please continue, Bob. 314 00:14:55,040 --> 00:14:58,040 Speaker 2: That's quite the entrepreneurial in instinct there by Joe, who 315 00:14:58,040 --> 00:15:00,280 Speaker 2: doesn't have a microphone and can't defend himself right now, So. 316 00:15:00,320 --> 00:15:01,680 Speaker 3: We'd like to do this to them. 317 00:15:01,960 --> 00:15:02,520 Speaker 4: In any case. 318 00:15:02,720 --> 00:15:05,320 Speaker 2: So what we're talking about here this is this isn't 319 00:15:05,400 --> 00:15:08,080 Speaker 2: just about getting a little extra paycheck, right, So this 320 00:15:08,200 --> 00:15:10,400 Speaker 2: also means you could be missing out on refundable tax 321 00:15:10,400 --> 00:15:13,160 Speaker 2: credits sometimes too, and that's where this really adds up. 322 00:15:13,200 --> 00:15:16,040 Speaker 2: So if you're in an income situation, you know, then 323 00:15:16,080 --> 00:15:18,520 Speaker 2: you might be looking at the earned income tax credit. 324 00:15:18,640 --> 00:15:20,720 Speaker 2: So for twenty two, for that twenty two tax here, 325 00:15:20,800 --> 00:15:23,440 Speaker 2: that credit was worth up to sixty nine thousand, six 326 00:15:23,960 --> 00:15:26,800 Speaker 2: nine hundred and thirty five dollars if you qualified for it. 327 00:15:27,080 --> 00:15:30,000 Speaker 2: Here's what makes those refundable credits different though, Even if 328 00:15:30,040 --> 00:15:32,800 Speaker 2: you didn't owe any federal taxes, you could still get 329 00:15:32,800 --> 00:15:33,200 Speaker 2: money back. 330 00:15:33,240 --> 00:15:34,520 Speaker 4: So the ones we're talking. 331 00:15:34,240 --> 00:15:36,520 Speaker 2: To are the people who got used to the idea that, well, 332 00:15:36,520 --> 00:15:38,840 Speaker 2: we just don't have enough income, so therefore they're not 333 00:15:38,880 --> 00:15:40,720 Speaker 2: going to be a return because we didn't pay any taxes. 334 00:15:40,720 --> 00:15:41,600 Speaker 4: There was no withholding. 335 00:15:41,840 --> 00:15:44,160 Speaker 2: That's not the case necessarily for everybody. You could be 336 00:15:44,160 --> 00:15:46,400 Speaker 2: getting money back even though you didn't pay anything. That's 337 00:15:46,400 --> 00:15:49,400 Speaker 2: what a fully refundable credit means. So look at that 338 00:15:49,480 --> 00:15:52,000 Speaker 2: earned income tax credit. Google it tonight and see if 339 00:15:52,040 --> 00:15:52,920 Speaker 2: you had any money come. 340 00:15:52,840 --> 00:15:53,240 Speaker 3: In your way. 341 00:15:54,160 --> 00:15:55,720 Speaker 2: You know, but if you don't, cause if you don't file, 342 00:15:55,800 --> 00:15:57,360 Speaker 2: you'll never see it in the first place. So make 343 00:15:57,400 --> 00:15:58,520 Speaker 2: sure you take advantage of that. 344 00:16:00,080 --> 00:16:02,640 Speaker 3: Let's move on to something more fun baseball. Did you 345 00:16:02,800 --> 00:16:06,560 Speaker 3: enjoy Opening Day along with that? 346 00:16:06,760 --> 00:16:10,160 Speaker 1: Did you know the Cincinnati Reds are worth more than 347 00:16:10,200 --> 00:16:14,040 Speaker 1: ever on paper? But they're still playing catchup when it 348 00:16:14,120 --> 00:16:16,760 Speaker 1: comes to the business side of baseball, I guess to 349 00:16:16,880 --> 00:16:21,560 Speaker 1: nobody's surprise. According to New estimates, Brian Our Cincinnati Reds 350 00:16:21,560 --> 00:16:25,400 Speaker 1: are now worth about one point six seven billion dollars. 351 00:16:25,760 --> 00:16:28,880 Speaker 1: That's up roughly eight percent from last year when the 352 00:16:28,920 --> 00:16:31,440 Speaker 1: team was valued closer to a billion and a half. 353 00:16:32,120 --> 00:16:33,480 Speaker 3: That's a lot of money. You know. 354 00:16:33,600 --> 00:16:36,320 Speaker 1: The Castellinis have made a lot of money since they 355 00:16:36,360 --> 00:16:40,360 Speaker 1: bought the Reds back in six for a paltry two 356 00:16:40,480 --> 00:16:42,160 Speaker 1: hundred and seventy million dollars. 357 00:16:42,200 --> 00:16:42,880 Speaker 3: How about that now. 358 00:16:43,280 --> 00:16:46,000 Speaker 2: I think most of that comes from the growth of 359 00:16:46,280 --> 00:16:49,520 Speaker 2: Nacho helmets being sold there Great American Ballpark. I think 360 00:16:49,560 --> 00:16:52,320 Speaker 2: that's really the key that has put them over the edge. Now, 361 00:16:52,600 --> 00:16:57,160 Speaker 2: that's that's that's a fantastic investment for the Castellini group. 362 00:16:57,200 --> 00:16:59,720 Speaker 2: We would all love to, you know, have an investment 363 00:16:59,720 --> 00:17:03,359 Speaker 2: that has performed that way. I think we'd also also 364 00:17:03,520 --> 00:17:06,200 Speaker 2: love to have a team that performs that way through 365 00:17:06,240 --> 00:17:08,080 Speaker 2: the end of the season and maybe bring home a 366 00:17:08,359 --> 00:17:11,760 Speaker 2: maybe bring home an actual playoff advancement this time around. 367 00:17:11,760 --> 00:17:12,280 Speaker 3: I feel good. 368 00:17:12,400 --> 00:17:14,280 Speaker 2: I think this is the season for that to happen. 369 00:17:15,040 --> 00:17:16,280 Speaker 3: Well, it's funny you bring that up. 370 00:17:16,320 --> 00:17:18,959 Speaker 1: The Reds are near the bottom in terms of valuation, 371 00:17:19,200 --> 00:17:21,960 Speaker 1: twenty six out of thirty teams. So while it's been 372 00:17:21,960 --> 00:17:26,040 Speaker 1: a very profitable venture for the Castellini family that owns 373 00:17:26,080 --> 00:17:29,520 Speaker 1: the teams. Imagine what that valuation could be if we 374 00:17:29,600 --> 00:17:31,960 Speaker 1: actually get to the playoffs consistently. 375 00:17:32,000 --> 00:17:35,080 Speaker 3: But I digress. All right, we can't go up nowhere 376 00:17:35,119 --> 00:17:37,840 Speaker 3: but up all right, let's. 377 00:17:37,560 --> 00:17:41,960 Speaker 1: Talk about March Madness and yet another foolish income strategy. 378 00:17:42,200 --> 00:17:44,240 Speaker 3: I think this is. Let's just have some fun with this. 379 00:17:46,520 --> 00:17:49,720 Speaker 1: The claim out there is that during March Madness, stock 380 00:17:49,840 --> 00:17:53,159 Speaker 1: market returns tend to be lower because investors get in 381 00:17:53,200 --> 00:17:56,680 Speaker 1: a bad mood when their teams lose, and that leads 382 00:17:56,720 --> 00:18:00,320 Speaker 1: them to sell stocks when they're down. To take away, 383 00:18:00,480 --> 00:18:02,480 Speaker 1: you might want to just sit on your hands and 384 00:18:02,560 --> 00:18:05,480 Speaker 1: avoid investing until the tournament is over. 385 00:18:06,040 --> 00:18:07,480 Speaker 3: Uh, this is just another one of. 386 00:18:07,440 --> 00:18:11,480 Speaker 1: These stories that we call ridiculous, especially in Cincinnati, Brian, 387 00:18:11,560 --> 00:18:14,760 Speaker 1: because I have to say, the March Madness is pretty 388 00:18:14,760 --> 00:18:20,600 Speaker 1: irrelevant to fans of UC Xavier, Ohio University because their 389 00:18:20,640 --> 00:18:22,520 Speaker 1: teams weren't even in March Madness. 390 00:18:23,280 --> 00:18:25,720 Speaker 4: Now you're ignoring Miami completely. 391 00:18:25,760 --> 00:18:28,080 Speaker 2: By we got a lot of Red Hawks screaming at 392 00:18:28,119 --> 00:18:28,760 Speaker 2: you right now. 393 00:18:29,040 --> 00:18:32,240 Speaker 1: Well, I'll leave it there. My Red Hawks were in 394 00:18:32,320 --> 00:18:35,800 Speaker 1: the tournament. The people that I'm worried about. Are these 395 00:18:35,920 --> 00:18:38,480 Speaker 1: UK fans who lost in the second round and that 396 00:18:38,680 --> 00:18:43,440 Speaker 1: literally could cause a stock market, you know, plummeting because 397 00:18:43,480 --> 00:18:46,600 Speaker 1: those people are a different breed. When their teams lose, boy, 398 00:18:46,920 --> 00:18:49,600 Speaker 1: they might actually need you know, therapy. What do you think, 399 00:18:49,640 --> 00:18:50,240 Speaker 1: Brian about it? 400 00:18:50,640 --> 00:18:52,840 Speaker 2: I think Lexington does those low to a hault for 401 00:18:53,480 --> 00:18:55,280 Speaker 2: at least a day or so there while the while 402 00:18:55,320 --> 00:18:58,160 Speaker 2: the reality sinks in. But in any case, no, don't 403 00:18:58,200 --> 00:19:00,520 Speaker 2: ignore these headlines as far as your real poor folio goos. 404 00:19:00,560 --> 00:19:02,280 Speaker 2: Basketball's got nothing to do with that. These are just 405 00:19:02,320 --> 00:19:06,160 Speaker 2: garbage headlines by somebody who needed some clickbait all. 406 00:19:06,119 --> 00:19:09,960 Speaker 1: Right in your inbox, meaning your email inbox could be 407 00:19:10,320 --> 00:19:13,159 Speaker 1: the weakest link in your entire financial life. 408 00:19:13,480 --> 00:19:14,920 Speaker 3: How to lock that down? 409 00:19:15,040 --> 00:19:17,720 Speaker 1: Next, you're listening to Simply Money presented by all Worth 410 00:19:17,760 --> 00:19:27,040 Speaker 1: Financial on fifty five KRC the talk station. You're listening 411 00:19:27,080 --> 00:19:29,720 Speaker 1: to Simply Money presented by all Worth Financial. I'm Bob 412 00:19:29,840 --> 00:19:34,040 Speaker 1: Sponsller along with Brian James, joined tonight by our technology 413 00:19:34,119 --> 00:19:38,600 Speaker 1: and cybersecurity guru, mister Dave Hatter. Dave, it's always great 414 00:19:38,600 --> 00:19:41,480 Speaker 1: to have you with us tonight. You want to talk 415 00:19:41,520 --> 00:19:44,480 Speaker 1: about elder scams and this is something that seems to 416 00:19:44,520 --> 00:19:48,359 Speaker 1: be growing and growing in regularity, and it's something we 417 00:19:48,400 --> 00:19:50,919 Speaker 1: all need to be aware of and make plans to prevent. 418 00:19:52,160 --> 00:19:55,560 Speaker 5: Yeah, guys, sadly this appreciate you having me on. It's 419 00:19:55,560 --> 00:19:57,560 Speaker 5: always I think this is an important topic because you 420 00:19:57,560 --> 00:20:00,920 Speaker 5: know I have elderly parents, any of your listeners do, 421 00:20:01,240 --> 00:20:03,919 Speaker 5: and this is a growing concern. So just one stat 422 00:20:04,000 --> 00:20:06,120 Speaker 5: and this is a great site for folks, by the way, 423 00:20:06,840 --> 00:20:10,600 Speaker 5: just for general stats and information. The Internet Crime Complaints 424 00:20:10,640 --> 00:20:14,480 Speaker 5: Center IC three, which is run by the FBI. They 425 00:20:14,520 --> 00:20:16,760 Speaker 5: put out a fraud report every year that's got all 426 00:20:16,840 --> 00:20:18,760 Speaker 5: kinds of stats in it. And again the site is 427 00:20:18,800 --> 00:20:20,680 Speaker 5: just useful in a lot of ways. I encourage people 428 00:20:20,720 --> 00:20:25,520 Speaker 5: to bookmarkt IC three dot gov. Elder fraud losses hit 429 00:20:25,600 --> 00:20:28,240 Speaker 5: four point eight eight billion and twenty twenty four, a 430 00:20:28,240 --> 00:20:31,240 Speaker 5: staggering forty three percent jump from the previous year. The 431 00:20:31,359 --> 00:20:35,359 Speaker 5: average senior victim lost over eighty three thousand dollars. And 432 00:20:35,400 --> 00:20:38,040 Speaker 5: then another good site for some insight into this is 433 00:20:38,080 --> 00:20:41,480 Speaker 5: the Federal Trade Commission FTCFTC dot gov. So here's a 434 00:20:41,560 --> 00:20:45,320 Speaker 5: headline from a public service announcement they put out. Business 435 00:20:45,320 --> 00:20:49,399 Speaker 5: and government impersonators go after older adel's life savings, and 436 00:20:49,440 --> 00:20:51,720 Speaker 5: then they have some stats in there too they say, 437 00:20:51,760 --> 00:20:55,679 Speaker 5: in fact, reported losses of over one hundred thousand dollars 438 00:20:55,720 --> 00:20:59,160 Speaker 5: increase nearly sevenfold from twenty twenty to twenty twenty four. 439 00:20:59,760 --> 00:21:02,240 Speaker 5: So you know, I hate to always be the doomsday guy, 440 00:21:02,359 --> 00:21:04,600 Speaker 5: the guy with the ten foil hat, always warning about 441 00:21:04,600 --> 00:21:06,640 Speaker 5: this stuff, but you know, I don't want to see 442 00:21:06,640 --> 00:21:10,359 Speaker 5: people lose their entire life savings. And is we spend 443 00:21:10,400 --> 00:21:14,160 Speaker 5: more time online and every facet of our lives working, education, 444 00:21:14,560 --> 00:21:18,000 Speaker 5: you know, school, you name it, think about it. What 445 00:21:18,160 --> 00:21:20,679 Speaker 5: are you not doing online nowadays? It just creates that 446 00:21:20,760 --> 00:21:23,639 Speaker 5: many more attack factors for the bad guys. You're throwing 447 00:21:23,680 --> 00:21:26,840 Speaker 5: things like artificial intelligence and the ability to generate, to 448 00:21:26,880 --> 00:21:32,000 Speaker 5: clone someone's voice, to generate incredibly realistic videos, incredibly realistic texts, 449 00:21:32,000 --> 00:21:35,160 Speaker 5: to kind of eliminate all the old school tells like well, 450 00:21:35,200 --> 00:21:37,320 Speaker 5: I got an email asking me to do something weird 451 00:21:37,359 --> 00:21:39,040 Speaker 5: and I need to send gift cards to the Hamlety 452 00:21:39,119 --> 00:21:41,880 Speaker 5: County sheriffs can arrest me, but the grammar's all weird 453 00:21:41,920 --> 00:21:44,679 Speaker 5: and so forth, all that's gone. The bad guys have 454 00:21:44,760 --> 00:21:47,479 Speaker 5: access to low cost or free tools that make it 455 00:21:47,520 --> 00:21:50,360 Speaker 5: really easy for them to run these sort of scams 456 00:21:50,480 --> 00:21:52,720 Speaker 5: at scale. And again, you don't have to take my 457 00:21:52,800 --> 00:21:55,000 Speaker 5: word for it. You can see what the FBI is saying, 458 00:21:55,119 --> 00:21:57,480 Speaker 5: You can see what the FTC is saying. And at 459 00:21:57,480 --> 00:21:59,560 Speaker 5: one last point, and then I'll let you guys start 460 00:21:59,560 --> 00:22:04,080 Speaker 5: asking some specific questions. Is you know this again, the 461 00:22:04,160 --> 00:22:07,760 Speaker 5: documentation is all out there. The scams are increasing, They're 462 00:22:07,800 --> 00:22:10,240 Speaker 5: targeting elderly people in some cases. But you know, we're 463 00:22:10,280 --> 00:22:13,000 Speaker 5: all subject to all kinds of scams, and this kind 464 00:22:13,040 --> 00:22:16,159 Speaker 5: of education is important, as is a healthy dose of 465 00:22:16,200 --> 00:22:19,159 Speaker 5: skepticism and vigilance. You know, the hamlet, the kind of 466 00:22:19,200 --> 00:22:21,600 Speaker 5: sheriff is not going to call you and tell you 467 00:22:21,640 --> 00:22:23,960 Speaker 5: that because of a parking ticket, they're coming at three 468 00:22:24,040 --> 00:22:26,960 Speaker 5: to arrest you if you don't buy gift cards or 469 00:22:27,000 --> 00:22:29,720 Speaker 5: send an INMO payment, Right, they don't operate that way. 470 00:22:30,000 --> 00:22:32,400 Speaker 6: Hey, hey, Dave, So yeah, and then those are those 471 00:22:32,440 --> 00:22:34,439 Speaker 6: are those are all great examples. But you're right, this 472 00:22:34,520 --> 00:22:37,040 Speaker 6: isn't new news anymore. And I think the one the 473 00:22:37,040 --> 00:22:38,760 Speaker 6: one that is new is the to me is the 474 00:22:38,800 --> 00:22:40,800 Speaker 6: deep fake stuff. I don't think we've even scratched the 475 00:22:40,840 --> 00:22:42,760 Speaker 6: surface on that. I have yet to hear a story 476 00:22:43,359 --> 00:22:45,400 Speaker 6: you know about somebody losing an awful lot of money 477 00:22:45,480 --> 00:22:47,080 Speaker 6: yet to that, but that is coming and it's going 478 00:22:47,119 --> 00:22:50,200 Speaker 6: to be huge. So these articles you said is extremely 479 00:22:50,240 --> 00:22:53,560 Speaker 6: helpful here, but the reference an awful lot about cyber insurance. 480 00:22:53,640 --> 00:22:55,600 Speaker 6: So I don't want to drag you off course here, 481 00:22:55,600 --> 00:22:57,800 Speaker 6: but is this something that we should be considering. I mean, 482 00:22:57,800 --> 00:22:59,680 Speaker 6: maybe we all have home insurance, we have fire insurance, 483 00:22:59,720 --> 00:23:02,160 Speaker 6: we got insurance in some case. Is it we at 484 00:23:02,200 --> 00:23:04,360 Speaker 6: a point where we should all consider cyber insurance? 485 00:23:04,400 --> 00:23:04,760 Speaker 4: Do you think? 486 00:23:05,640 --> 00:23:08,720 Speaker 5: Uh? I think it's worth it as a business, absolutely, 487 00:23:08,960 --> 00:23:11,800 Speaker 5: But I also find that many small businesses that I 488 00:23:11,840 --> 00:23:13,359 Speaker 5: talk to about this stuff because you know, in my 489 00:23:13,400 --> 00:23:15,440 Speaker 5: real job, I'm not talking about this all the time 490 00:23:15,480 --> 00:23:23,000 Speaker 5: and trying to help business d Yeah, you know, people 491 00:23:23,000 --> 00:23:24,920 Speaker 5: will say, well, I've got cyber insurance. I don't like 492 00:23:24,960 --> 00:23:27,160 Speaker 5: to care about this, and I just like to remind folks, well, 493 00:23:27,480 --> 00:23:30,160 Speaker 5: your fire insurance does not keep your building from burning down. 494 00:23:30,600 --> 00:23:33,080 Speaker 5: You know, ideally it helps you recover should that happen. 495 00:23:33,480 --> 00:23:35,600 Speaker 5: So you can't just say well, I got insurance, I'm 496 00:23:35,600 --> 00:23:36,040 Speaker 5: good to go. 497 00:23:36,160 --> 00:23:36,280 Speaker 3: Right. 498 00:23:36,359 --> 00:23:39,880 Speaker 5: You need a strategy where you're trying to parden your environment, 499 00:23:40,040 --> 00:23:43,600 Speaker 5: defend yourself against these kind of attacks. Be smart, be vigilant, 500 00:23:43,680 --> 00:23:46,960 Speaker 5: move slow, and then you know, be resilient. Part of 501 00:23:46,960 --> 00:23:50,120 Speaker 5: that resilience, you know, in addition to backups and so forth, 502 00:23:50,320 --> 00:23:51,160 Speaker 5: might be insurance. 503 00:23:51,880 --> 00:23:52,760 Speaker 3: You know, as an. 504 00:23:52,600 --> 00:23:54,879 Speaker 5: Individual, does it make sense to get some kind of 505 00:23:55,000 --> 00:23:58,240 Speaker 5: personal cyber insurance? Maybe, especially if you have a lot 506 00:23:58,240 --> 00:24:00,800 Speaker 5: of risk, if you're a high net worth person. But 507 00:24:00,840 --> 00:24:02,840 Speaker 5: I think there's a lot of things you can do, guys. Again, 508 00:24:02,880 --> 00:24:05,520 Speaker 5: the first step is always knowledge, right, I mean, you 509 00:24:05,560 --> 00:24:07,600 Speaker 5: can't defend against something you don't know about. 510 00:24:08,600 --> 00:24:09,960 Speaker 3: Knowledge, skepticism. 511 00:24:10,080 --> 00:24:12,800 Speaker 5: It's doing the simple things we talk about all the time, strong, 512 00:24:12,880 --> 00:24:17,200 Speaker 5: unique passwords, multifacturer authentication. It's also doing things like freezing 513 00:24:17,200 --> 00:24:19,280 Speaker 5: your credit I'm sure you guys would agree. You know 514 00:24:20,080 --> 00:24:25,399 Speaker 5: my card, Yeah, until I need to get credit, I 515 00:24:25,920 --> 00:24:28,080 Speaker 5: keep it frozen, I unlock it when I need it, 516 00:24:28,320 --> 00:24:30,400 Speaker 5: and I lock it back. You know, it's not foolproof, 517 00:24:30,440 --> 00:24:33,040 Speaker 5: but you know you're raising the bar. You're making yourself 518 00:24:33,080 --> 00:24:35,520 Speaker 5: a much more difficult target for the bad guys because 519 00:24:35,840 --> 00:24:39,480 Speaker 5: in most of these cases, especially you know, these targeting 520 00:24:39,480 --> 00:24:43,000 Speaker 5: of elders, they're not specifically targeting individuals. They're going for 521 00:24:43,080 --> 00:24:45,840 Speaker 5: low hanging fruit. And if you take the kind of 522 00:24:45,880 --> 00:24:49,360 Speaker 5: advice we're giving out here. If you harden yourself, if 523 00:24:49,359 --> 00:24:51,960 Speaker 5: you do these basic practices, you're going to be a 524 00:24:52,000 --> 00:24:54,199 Speaker 5: much more difficult target. They're just going to move on. 525 00:24:54,760 --> 00:24:56,040 Speaker 3: And again the skepticism. 526 00:24:56,359 --> 00:24:58,760 Speaker 5: You know, I encourage any of your listeners pick up 527 00:24:58,800 --> 00:25:00,720 Speaker 5: the phone and try to call Microsoft after Google and 528 00:25:00,760 --> 00:25:04,399 Speaker 5: get help. And my point is they are not looking 529 00:25:04,440 --> 00:25:06,520 Speaker 5: at your computer and going, hey, I think you've got 530 00:25:06,520 --> 00:25:08,479 Speaker 5: a virus. I'm going to call you up today and 531 00:25:08,520 --> 00:25:11,360 Speaker 5: tell you let me help you remove this virus. If 532 00:25:11,359 --> 00:25:14,600 Speaker 5: you get a call, an unsolicited call from a company 533 00:25:14,640 --> 00:25:16,439 Speaker 5: that claims you have some kind of virus and they 534 00:25:16,480 --> 00:25:19,280 Speaker 5: want to help you, the likelihood that that is not 535 00:25:19,320 --> 00:25:22,040 Speaker 5: a scam is probably greater than all three of us 536 00:25:22,080 --> 00:25:25,000 Speaker 5: getting hit by a meteor. Right now, it is a scam, 537 00:25:25,119 --> 00:25:31,200 Speaker 5: right So again, vigilance, knowledge, skepticism, And you know, when 538 00:25:31,200 --> 00:25:33,320 Speaker 5: you look at the numbers. One of these reports say 539 00:25:33,320 --> 00:25:35,600 Speaker 5: there's eighty five trillion dollars in wealth out there in 540 00:25:35,640 --> 00:25:39,560 Speaker 5: the baby boom and silent generation. The bad guys know this, right, 541 00:25:40,160 --> 00:25:42,320 Speaker 5: They know there's an enormous amount of money. They know 542 00:25:42,760 --> 00:25:45,520 Speaker 5: in a lot of cases, older people may not even 543 00:25:45,560 --> 00:25:48,639 Speaker 5: be aware that it's possible to create a very you know, 544 00:25:48,680 --> 00:25:51,760 Speaker 5: a perfect deep fake audio or video, and you know 545 00:25:51,760 --> 00:25:55,600 Speaker 5: you guys mentioned there is documented evidence already more in 546 00:25:55,640 --> 00:25:59,439 Speaker 5: a corporate setting of large scale fraud that's been perpetrated 547 00:25:59,560 --> 00:26:02,879 Speaker 5: using d fake voice cloning and videos. I encourage your 548 00:26:02,880 --> 00:26:06,800 Speaker 5: folks go look up the story about the Ferrari CFO 549 00:26:06,840 --> 00:26:09,680 Speaker 5: who got a nearly got deep fake voice cloned into 550 00:26:09,680 --> 00:26:13,280 Speaker 5: fraud from the so called Ferrari CEO. And these are 551 00:26:13,320 --> 00:26:14,760 Speaker 5: people that know each other personally. 552 00:26:14,960 --> 00:26:17,840 Speaker 4: This gave us a segment maybe for next week. I'm 553 00:26:17,920 --> 00:26:18,760 Speaker 4: in right that one. 554 00:26:18,840 --> 00:26:23,720 Speaker 3: Now, I would look into it well documented, Dave. 555 00:26:23,800 --> 00:26:26,280 Speaker 1: I was going to ask about the whole phone thing 556 00:26:26,359 --> 00:26:29,760 Speaker 1: and voice cloning, so I'll just ask it this way. 557 00:26:29,840 --> 00:26:32,200 Speaker 1: I mean, are we now at a point where it's 558 00:26:32,320 --> 00:26:35,040 Speaker 1: just because I know what I do. I never answer 559 00:26:35,160 --> 00:26:39,119 Speaker 1: my phone ever, ever, ever, unless I know who's calling me, 560 00:26:39,240 --> 00:26:41,119 Speaker 1: I just don't answer my phone. Are we at the 561 00:26:41,160 --> 00:26:45,760 Speaker 1: point now where our advice to folks, especially elderly and 562 00:26:45,840 --> 00:26:50,440 Speaker 1: maybe vulnerable folks, just give that blanket advice, do not 563 00:26:50,680 --> 00:26:53,480 Speaker 1: answer your phone unless you know who it is. 564 00:26:53,560 --> 00:26:54,720 Speaker 3: Are we at that point? 565 00:26:54,800 --> 00:26:56,479 Speaker 4: Is that the best way to protect folks? 566 00:26:57,520 --> 00:26:59,520 Speaker 5: I think so I can tell you I do not 567 00:26:59,640 --> 00:27:02,359 Speaker 5: ever answer my phone from a number I don't recognize, 568 00:27:02,400 --> 00:27:04,760 Speaker 5: and I'm even sometimes skeptical if it is a number 569 00:27:04,760 --> 00:27:07,800 Speaker 5: I do recognize. Because keep in mind, guys, spoofing, which 570 00:27:07,840 --> 00:27:09,720 Speaker 5: in my mind is the biggest driver of all this, 571 00:27:09,840 --> 00:27:13,760 Speaker 5: creating something that looks realistic but isn't. It's fairly easy 572 00:27:13,800 --> 00:27:17,320 Speaker 5: to do in any digital mechanism. It's really easy to 573 00:27:17,359 --> 00:27:19,800 Speaker 5: send a phone call from any number you want, if 574 00:27:19,800 --> 00:27:21,480 Speaker 5: you know what you're doing, and it does not require 575 00:27:21,480 --> 00:27:23,400 Speaker 5: a lot of skills. So you know, if I could 576 00:27:23,440 --> 00:27:25,320 Speaker 5: find one of your two cell phone numbers, or if 577 00:27:25,320 --> 00:27:27,439 Speaker 5: I happen to have it, I could easily spoof a 578 00:27:27,480 --> 00:27:29,480 Speaker 5: call that would look like it came from your cell phone. 579 00:27:29,800 --> 00:27:31,720 Speaker 5: I could easily send a text that looks like it 580 00:27:31,760 --> 00:27:33,840 Speaker 5: comes from you. And you know, same thing with emails. 581 00:27:33,880 --> 00:27:38,520 Speaker 5: So skepticism, vigilance, don't answer the phone if it's important. 582 00:27:38,520 --> 00:27:41,400 Speaker 5: They'll leave a message, or they'll contact you some other way. 583 00:27:41,840 --> 00:27:45,199 Speaker 5: Go read what the government says, you know, IRS, FBI. 584 00:27:45,680 --> 00:27:47,639 Speaker 5: They are not going to call you and tell you 585 00:27:48,240 --> 00:27:50,200 Speaker 5: some terrible thing is going to happen to you if 586 00:27:50,200 --> 00:27:52,440 Speaker 5: you don't make it in when a payment by five PM. 587 00:27:52,480 --> 00:27:55,280 Speaker 5: They don't operate that way, and they state that clearly 588 00:27:55,359 --> 00:27:58,280 Speaker 5: on their own websites. So again, there's tons of useful 589 00:27:58,280 --> 00:28:00,920 Speaker 5: information out there that can help people have waid these 590 00:28:00,960 --> 00:28:04,959 Speaker 5: kind of scans FTC dot GOVIC three dot gov. But 591 00:28:05,160 --> 00:28:09,080 Speaker 5: it all starts with skepticism and caution, like don't answer 592 00:28:09,160 --> 00:28:10,680 Speaker 5: your phone if you don't recognize the number. 593 00:28:10,720 --> 00:28:11,680 Speaker 3: They'll leave a message to it. 594 00:28:11,720 --> 00:28:13,160 Speaker 5: If they don't, must not be important. 595 00:28:13,800 --> 00:28:16,600 Speaker 1: All right, good stuff as always, Dave. You're listening to 596 00:28:16,640 --> 00:28:19,360 Speaker 1: Simply Money presented by all Worth Financial on fifty five 597 00:28:19,440 --> 00:28:28,520 Speaker 1: KRC the talk station. You're listening to Simply Money presented 598 00:28:28,560 --> 00:28:31,000 Speaker 1: by all Worth Financial on Bob's Fun Seller along with 599 00:28:31,000 --> 00:28:33,520 Speaker 1: Brian James. You have a financial question you'd like for 600 00:28:33,680 --> 00:28:35,880 Speaker 1: us to answer. There's a red button you can click 601 00:28:35,920 --> 00:28:38,280 Speaker 1: while you're listening to the show. If you're listening on 602 00:28:38,320 --> 00:28:41,920 Speaker 1: the iHeart app, simply record your question and it will 603 00:28:41,960 --> 00:28:46,360 Speaker 1: come straight to us. All right, Brian Barry and Anderson says, Hey, 604 00:28:46,400 --> 00:28:49,000 Speaker 1: I'm retiring next year. We need about seventy five hundred 605 00:28:49,000 --> 00:28:52,120 Speaker 1: dollars a month after taxes to live on. Should I 606 00:28:52,200 --> 00:28:56,840 Speaker 1: set up automatic withdraws from one account or manually decide 607 00:28:56,880 --> 00:28:59,720 Speaker 1: each quarter where the money should come from. 608 00:29:00,040 --> 00:29:02,600 Speaker 2: Yeah, that's a great question. I'm a huge fan of automation. 609 00:29:02,800 --> 00:29:04,360 Speaker 2: I'm lazy. I want to set it and forget it. 610 00:29:04,400 --> 00:29:05,840 Speaker 2: So when I get to this point, yes, I'm going 611 00:29:05,880 --> 00:29:08,840 Speaker 2: to have this same question myself. So well, if you 612 00:29:08,840 --> 00:29:11,160 Speaker 2: need seventy five hundred a month after tax, this isn't 613 00:29:11,280 --> 00:29:13,840 Speaker 2: just a question of the mechanics. It's also got to 614 00:29:13,840 --> 00:29:17,360 Speaker 2: do with tax sequencing and overall kind of behavioral activity too. 615 00:29:17,880 --> 00:29:20,520 Speaker 2: So first off, you'll calculate that gross number. If you 616 00:29:20,560 --> 00:29:24,080 Speaker 2: need seventy five hundred after tax, that probably translates to 617 00:29:24,120 --> 00:29:26,920 Speaker 2: about eighty five hundred and nine thousand per month gross, 618 00:29:26,920 --> 00:29:29,560 Speaker 2: so that you can have your tax withholding done as well. 619 00:29:29,640 --> 00:29:33,080 Speaker 2: So then and then automation versus manual that's not an 620 00:29:33,120 --> 00:29:35,600 Speaker 2: either or question. That's about the structure. So here's the risk, 621 00:29:35,720 --> 00:29:38,040 Speaker 2: and there's pros and cons to both ways. Here's the 622 00:29:38,160 --> 00:29:41,320 Speaker 2: risk of pulling from just one account automatically. You could 623 00:29:41,360 --> 00:29:44,920 Speaker 2: unintentionally spike your taxable income just by being a robot 624 00:29:44,960 --> 00:29:48,040 Speaker 2: that can trigger higher Medicare IRMA brackets. You might lose 625 00:29:48,080 --> 00:29:50,640 Speaker 2: the opportunity to do some bracket management if you have 626 00:29:50,720 --> 00:29:54,040 Speaker 2: it kind of in a set and forget arrangement. You 627 00:29:54,080 --> 00:29:56,440 Speaker 2: may also wind up selling assets in a down market 628 00:29:56,480 --> 00:29:57,840 Speaker 2: without some kind of coordination. 629 00:29:58,600 --> 00:30:00,000 Speaker 4: So that's the downsides of it. 630 00:30:00,000 --> 00:30:02,840 Speaker 2: But obviously the upsides are automation in that laziness that 631 00:30:03,200 --> 00:30:06,320 Speaker 2: you know that I certainly aspire to myself. But on 632 00:30:06,360 --> 00:30:08,520 Speaker 2: the other hand, you're sacrificing some efficiency. 633 00:30:08,560 --> 00:30:10,160 Speaker 4: So if you go fully. 634 00:30:09,840 --> 00:30:11,880 Speaker 2: Manual each month, right, if you want to react to 635 00:30:11,920 --> 00:30:14,400 Speaker 2: those types of things, that can create some stress and 636 00:30:14,440 --> 00:30:16,120 Speaker 2: behavioral risk. In other words, you're going to have to 637 00:30:16,120 --> 00:30:19,040 Speaker 2: agonize what's this? These headlines are scary. Maybe I don't 638 00:30:19,040 --> 00:30:19,800 Speaker 2: want to pull out money. 639 00:30:19,800 --> 00:30:21,240 Speaker 4: Should I do it tomorrow? Maybe I'll do it at 640 00:30:21,240 --> 00:30:22,720 Speaker 4: the end of the week, and all of a sudden. 641 00:30:22,480 --> 00:30:25,240 Speaker 2: You've disrupted your ability to pay your bills and have 642 00:30:25,400 --> 00:30:28,960 Speaker 2: a relaxed retirement. So really the hybrid system might be 643 00:30:29,000 --> 00:30:31,520 Speaker 2: the best. So keep six to twelve months of spending 644 00:30:31,560 --> 00:30:33,840 Speaker 2: in cash or short term bonds. That way doesn't matter 645 00:30:33,920 --> 00:30:37,320 Speaker 2: so much because you're not necessarily using your income to 646 00:30:37,320 --> 00:30:39,640 Speaker 2: pay bills. You're using piles of cash you've set aside 647 00:30:39,800 --> 00:30:43,120 Speaker 2: automatic monthly transfers from that income bucket to your checking account, 648 00:30:43,200 --> 00:30:46,080 Speaker 2: and then refill that bucket every quarter. If the market's up, great, 649 00:30:46,120 --> 00:30:48,480 Speaker 2: take some of those proceeds off the table. If it's down, 650 00:30:48,520 --> 00:30:51,280 Speaker 2: you've got some buffer built into that bucket. So few 651 00:30:51,280 --> 00:30:53,160 Speaker 2: steps there, But it's great that you're thinking about these 652 00:30:53,200 --> 00:30:56,840 Speaker 2: things at the early on in retirement here. So we'll 653 00:30:56,840 --> 00:30:59,000 Speaker 2: move on now to Andrew and Hyde Park. Andrew's got 654 00:30:59,040 --> 00:31:01,240 Speaker 2: a three percent mortgage and he's thinking about paying it off. 655 00:31:01,280 --> 00:31:03,440 Speaker 2: But he's wondering if that money should stay invested. Is 656 00:31:03,480 --> 00:31:06,280 Speaker 2: it worth it with these once in a lifetime interest rates. 657 00:31:06,320 --> 00:31:09,000 Speaker 1: What do you think of that, Bob, Well, two ways 658 00:31:09,000 --> 00:31:11,960 Speaker 1: I'll answer that question. Number One, on a straight rate 659 00:31:12,000 --> 00:31:15,560 Speaker 1: of return standpoint, you know, almost in today's day and age, 660 00:31:15,600 --> 00:31:18,400 Speaker 1: it generally never makes sense to pay that three percent 661 00:31:18,480 --> 00:31:19,080 Speaker 1: mortgage off. 662 00:31:19,080 --> 00:31:20,160 Speaker 3: A couple of reasons there. 663 00:31:20,360 --> 00:31:22,440 Speaker 1: Number one, if you've had the mortgage for any length 664 00:31:22,480 --> 00:31:25,400 Speaker 1: of time, a lot of your payments each month are 665 00:31:25,480 --> 00:31:29,080 Speaker 1: going toward principle, not interest anyway. And then number two, 666 00:31:29,240 --> 00:31:33,120 Speaker 1: if you've got your cash or other portfolio position in 667 00:31:33,200 --> 00:31:36,880 Speaker 1: a manner that's getting you know, even after taxes higher 668 00:31:36,920 --> 00:31:40,240 Speaker 1: than that three percent rate of return, you're giving up 669 00:31:40,360 --> 00:31:43,560 Speaker 1: opportunity cost in the way of you know, higher rate 670 00:31:43,560 --> 00:31:47,200 Speaker 1: of return, and wealth building. So that's the that's the 671 00:31:47,280 --> 00:31:50,360 Speaker 1: rate of return answer or the math answer. Now, in 672 00:31:50,440 --> 00:31:54,560 Speaker 1: terms of lifestyle, if that mortgage payment is keeping you 673 00:31:54,640 --> 00:31:57,520 Speaker 1: from doing some other things that you need or want 674 00:31:57,560 --> 00:32:00,360 Speaker 1: to do in your life, and boy, if that getting 675 00:32:00,440 --> 00:32:02,600 Speaker 1: rid of that mortgage would free up cash to do 676 00:32:02,640 --> 00:32:06,840 Speaker 1: other things and your financial plan will support those other things, 677 00:32:07,320 --> 00:32:10,720 Speaker 1: then that's more of a lifestyle decision and a freedom 678 00:32:10,760 --> 00:32:13,640 Speaker 1: decision that you should explore as well. So that comes 679 00:32:13,680 --> 00:32:17,520 Speaker 1: down to how your overall financial plan is designed. And 680 00:32:17,640 --> 00:32:21,280 Speaker 1: sometimes we have people to come in and we explain. 681 00:32:21,280 --> 00:32:22,240 Speaker 3: You know, both ways. 682 00:32:22,320 --> 00:32:25,640 Speaker 1: And yeah, even though the math doesn't technically make sense 683 00:32:25,880 --> 00:32:29,840 Speaker 1: from a rate of return standpoint, if this mortgage is 684 00:32:29,960 --> 00:32:33,440 Speaker 1: keeping you from taking that vacation you've always wanted to take, 685 00:32:33,640 --> 00:32:36,520 Speaker 1: or you know, redoing your basement or other things that 686 00:32:36,640 --> 00:32:40,560 Speaker 1: just enhance your quality of life, then by all means, 687 00:32:40,640 --> 00:32:42,880 Speaker 1: move forward, get rid of the mortgage and move on. 688 00:32:43,040 --> 00:32:46,440 Speaker 1: Hope that helps, all right, David and Westwood says, I'm 689 00:32:46,480 --> 00:32:50,360 Speaker 1: deciding whether it's delayed social Security until late seventy how 690 00:32:50,400 --> 00:32:53,560 Speaker 1: do I compare the extra guarantee it guaranteed in come 691 00:32:53,680 --> 00:32:57,760 Speaker 1: later versus drawing more from investments. Now, this is a 692 00:32:57,800 --> 00:32:58,440 Speaker 1: great question. 693 00:32:58,520 --> 00:32:59,840 Speaker 4: Brian, Yeah, another good one. 694 00:33:00,000 --> 00:33:03,040 Speaker 2: I've got some good pointed questions today. So this is 695 00:33:03,080 --> 00:33:05,920 Speaker 2: one of the most consequential retirement decisions you're gonna make. 696 00:33:06,160 --> 00:33:08,400 Speaker 2: That's not just about that break even age. It's about 697 00:33:08,400 --> 00:33:10,960 Speaker 2: transferring the risk. So let's frame this up a little bit. 698 00:33:11,000 --> 00:33:14,000 Speaker 2: If you delay Social Security from four retirement to seventy, 699 00:33:14,240 --> 00:33:18,600 Speaker 2: that benefit grows about eight percent per year guaranteed, inflation adjusted, 700 00:33:20,000 --> 00:33:21,800 Speaker 2: and that will be permanently put in place once you 701 00:33:21,800 --> 00:33:22,560 Speaker 2: turn That's big and on. 702 00:33:22,840 --> 00:33:23,640 Speaker 4: That's the agony. 703 00:33:23,640 --> 00:33:25,560 Speaker 2: That's what we're trying to decide from, because there's nothing 704 00:33:25,600 --> 00:33:28,960 Speaker 2: else out there that gives you eight percent guaranteed and 705 00:33:29,160 --> 00:33:31,080 Speaker 2: no easier way to do it than simply by ignoring 706 00:33:31,080 --> 00:33:34,480 Speaker 2: your Social Security benefit. So compare that to drawing more 707 00:33:34,480 --> 00:33:37,280 Speaker 2: from your investments from say between sixty seven and seventy. 708 00:33:37,480 --> 00:33:39,520 Speaker 2: So what you're going to want to do is make 709 00:33:39,520 --> 00:33:41,880 Speaker 2: sure you understand what the cost will be to bridge 710 00:33:41,880 --> 00:33:45,000 Speaker 2: this gap. That if delaying to age seventy because you 711 00:33:45,000 --> 00:33:46,920 Speaker 2: want to push that out, if that means pulling an 712 00:33:46,920 --> 00:33:49,440 Speaker 2: extra fifty to sixty thousand per year for three years, 713 00:33:49,600 --> 00:33:51,120 Speaker 2: that's one hundred and fifty to one hundred and eighty 714 00:33:51,200 --> 00:33:54,520 Speaker 2: drawn earlier from the portfolio, I would say the difference there, 715 00:33:54,560 --> 00:33:57,480 Speaker 2: and when I've done this analysis for people, the difference 716 00:33:57,520 --> 00:33:59,440 Speaker 2: is frequently what kind of dollars are we talking about. 717 00:33:59,560 --> 00:34:01,240 Speaker 4: If it's an IRA and I. 718 00:34:01,240 --> 00:34:03,240 Speaker 2: Have to pay taxes on these dollars or four oh 719 00:34:03,240 --> 00:34:05,320 Speaker 2: one K and I gotta pay income taxes, that has 720 00:34:05,320 --> 00:34:08,880 Speaker 2: a huge impact, and that might mean a greater sacrifice 721 00:34:08,920 --> 00:34:10,839 Speaker 2: versus if these are taxable dollars, or if I've got 722 00:34:10,880 --> 00:34:13,359 Speaker 2: them in a savings account or something, that can make 723 00:34:13,400 --> 00:34:15,920 Speaker 2: a huge difference because I won't pay nearly as much 724 00:34:15,960 --> 00:34:16,480 Speaker 2: in taxes. 725 00:34:16,480 --> 00:34:18,000 Speaker 4: So that is usually the pivot point. 726 00:34:19,239 --> 00:34:23,560 Speaker 1: Coming up next, why millions more Americans are now actually 727 00:34:23,640 --> 00:34:26,719 Speaker 1: saving for retirement and what this trend teaches about the 728 00:34:26,760 --> 00:34:31,600 Speaker 1: one habit that tends to separate wealthy families from everyone else. 729 00:34:31,800 --> 00:34:34,320 Speaker 1: You're listening to Simply Money, presented by all Worth Financial 730 00:34:34,360 --> 00:34:42,560 Speaker 1: on fifty five KRC, the talk station. You're listening to 731 00:34:42,600 --> 00:34:45,560 Speaker 1: Simply Money presented by all Worth Financial on Bob Sponsller 732 00:34:45,600 --> 00:34:49,800 Speaker 1: along with Brian James. There's a really interesting trend happening 733 00:34:49,880 --> 00:34:52,960 Speaker 1: right now in the retirement world, and it tells us 734 00:34:52,960 --> 00:34:57,920 Speaker 1: something powerful about what actually builds wealth over time. In 735 00:34:57,960 --> 00:35:00,960 Speaker 1: this new trend or growing trend and Brian is that 736 00:35:01,160 --> 00:35:05,400 Speaker 1: small businesses are embracing the four oh one K plan 737 00:35:05,840 --> 00:35:06,880 Speaker 1: like never before. 738 00:35:08,280 --> 00:35:10,120 Speaker 2: So yeah, we want to be paying attention to this 739 00:35:10,200 --> 00:35:12,440 Speaker 2: because obviously, you know, lots of people out there have 740 00:35:12,440 --> 00:35:14,480 Speaker 2: a four oh one K and we want to learn 741 00:35:14,960 --> 00:35:16,680 Speaker 2: what we can take advantage of here. So this is 742 00:35:16,760 --> 00:35:19,840 Speaker 2: new data coming from Gusto, which is a payroll and 743 00:35:19,880 --> 00:35:23,439 Speaker 2: benefits provider. About six million more workers at these small 744 00:35:23,480 --> 00:35:25,319 Speaker 2: companies now have a four to oh one K is 745 00:35:25,400 --> 00:35:28,040 Speaker 2: just since twenty nineteen, So that brings the total to 746 00:35:28,120 --> 00:35:30,840 Speaker 2: more than twenty one million employees at firms with fewer 747 00:35:30,840 --> 00:35:33,160 Speaker 2: than one hundred workers who can now save through a 748 00:35:33,160 --> 00:35:36,440 Speaker 2: workplace plan. I remember early in my career being confused. 749 00:35:36,440 --> 00:35:38,840 Speaker 2: So that was always working for big banks, big financial institutions, 750 00:35:38,840 --> 00:35:40,360 Speaker 2: and I just sort of assumed, well, yeah, four oh 751 00:35:40,400 --> 00:35:41,440 Speaker 2: one K, it's what everybody has. 752 00:35:41,480 --> 00:35:43,800 Speaker 4: I've been hearing about that from my entire life. 753 00:35:44,000 --> 00:35:46,480 Speaker 2: But then as I learned more and more, I understood 754 00:35:46,480 --> 00:35:49,040 Speaker 2: that that is not how it worked. So the smaller 755 00:35:49,040 --> 00:35:51,600 Speaker 2: the company, the less likely you were to have a 756 00:35:51,600 --> 00:35:53,719 Speaker 2: four oh one K to even have that advantage of 757 00:35:53,719 --> 00:35:56,600 Speaker 2: that opportunity there. So this is a really important change 758 00:35:56,600 --> 00:35:59,640 Speaker 2: that now we've got the ability for these smaller companies 759 00:35:59,680 --> 00:36:01,319 Speaker 2: to be able to efficiently do this. 760 00:36:01,680 --> 00:36:03,440 Speaker 4: So there's actually an example in this report. 761 00:36:03,480 --> 00:36:06,560 Speaker 2: There's a business owner who basically said she understands investing 762 00:36:06,560 --> 00:36:09,480 Speaker 2: because she's an accountant, but had never prioritized you. It 763 00:36:09,480 --> 00:36:10,759 Speaker 2: sounds like a case of I don't want to bring 764 00:36:10,760 --> 00:36:12,520 Speaker 2: my work home. So she never bothered looking at her 765 00:36:12,520 --> 00:36:14,600 Speaker 2: own four oh one K, even though she dealt with 766 00:36:14,640 --> 00:36:17,239 Speaker 2: it as part of her job. So she finally got 767 00:36:17,239 --> 00:36:19,279 Speaker 2: it set up for her company. So then once that 768 00:36:19,320 --> 00:36:21,680 Speaker 2: system was in place, she did start maxing out. Now 769 00:36:21,680 --> 00:36:23,759 Speaker 2: she's in a better spot, but definitely a case of 770 00:36:24,200 --> 00:36:25,600 Speaker 2: physician heal thyself, I. 771 00:36:25,560 --> 00:36:26,960 Speaker 4: Think, yeah. 772 00:36:27,000 --> 00:36:31,360 Speaker 1: And we're also seeing another good trend here. Small businesses 773 00:36:31,360 --> 00:36:35,320 Speaker 1: are adopting something called a pooled employer plan, where companies 774 00:36:35,360 --> 00:36:40,440 Speaker 1: banded together to lower costs and simplify plan administration. Brian, 775 00:36:40,560 --> 00:36:44,600 Speaker 1: I love this trend because now there's about three hundred 776 00:36:44,600 --> 00:36:47,960 Speaker 1: and forty of these plans now covering more than fifty 777 00:36:48,000 --> 00:36:52,160 Speaker 1: one thousand dollars fifty one thousand employees, many offering retirement 778 00:36:52,200 --> 00:36:55,600 Speaker 1: benefits for the first time, and let's face it, Brian, 779 00:36:55,680 --> 00:36:58,360 Speaker 1: as you've already pointed out, for younger people just getting 780 00:36:58,400 --> 00:37:01,200 Speaker 1: started out, they need a little guidance, they need a 781 00:37:01,239 --> 00:37:03,520 Speaker 1: little nudge, and they need some tools to get in 782 00:37:03,560 --> 00:37:06,839 Speaker 1: the game and start putting money away. And you know 783 00:37:06,880 --> 00:37:08,960 Speaker 1: the fact that these four oh one k things are 784 00:37:09,040 --> 00:37:12,279 Speaker 1: evolving to reach out to some of these smaller employers. 785 00:37:12,320 --> 00:37:15,360 Speaker 1: I think it's a wonderful thing. Thanks for listening tonight. 786 00:37:15,400 --> 00:37:17,680 Speaker 1: You've been listening to Simply Money, presented by all Worth 787 00:37:17,719 --> 00:37:21,040 Speaker 1: Financial on fifty five KRC, the talk station