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Speaker 1: Joe Larsgard of how to Money, heard every Sunday right

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Speaker 1: here twelve two pm on KFI. His social address is

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Speaker 1: at how to Money Joel and you can visit his website,

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Speaker 1: howto money dot com. And good morning Joel, Yes, good

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Speaker 1: morning to one and all. Did that sound like I

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Speaker 1: cared on that one? I hope so.

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Speaker 2: I never do.

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Speaker 1: Okay, a story that I want to explore, and that

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Speaker 1: is the betting that happened in the Super Bowl, and

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Speaker 1: the prediction market.

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Speaker 2: Did very very well for betters this year. So let's

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Speaker 2: talk about that.

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Speaker 3: Well, yeah, it depends on what you mean. Did well

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Speaker 3: for betters. It certainly attracted a lot of people, right.

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Speaker 3: And the loophole now for gambling, because it's you know,

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Speaker 3: not legal in many states, gambling on sports is now

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Speaker 3: going through these prediction markets. You're making predictions, you're not gambling.

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Speaker 3: It's very very different, of course, except for not really.

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Speaker 2: Uh.

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Speaker 3: And these prediction websites are just drawing people in by

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Speaker 3: by the millions. I think two million folks essentially on

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Speaker 3: Calshi were actively wagering on game day on the Super Bowl,

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Speaker 3: over a billion dollars was put up for the Big Game.

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Speaker 3: And that's that's that's just Calshi. So there are other

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Speaker 3: sites like polymarket that allow for this too, And as

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Speaker 3: you know, like sports gambling and FanDuel and sites like

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Speaker 3: that have have allowed you not just to bet on

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Speaker 3: the outcome of the game, but to bet on a

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Speaker 3: slew of other things as well. And that's the same

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Speaker 3: thing with these prediction market websites, where you could just

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Speaker 3: bet on ancillary things surrounding the game, like what outfit

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Speaker 3: bad Bunny was going to, where whether certain political statements

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Speaker 3: were going.

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Speaker 2: To be made.

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Speaker 3: You could you could even bet on which companies if

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Speaker 3: they you know, if it wasn't known which companies were

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Speaker 3: or were not going to run ads during.

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Speaker 2: The Super Bowl.

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Speaker 3: It's it's like peak insanity, or at least I thought

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Speaker 3: it might be peak insanity.

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Speaker 2: And I don't know.

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Speaker 3: With March Madness and World Cup coming up, it just

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Speaker 3: could get worse.

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Speaker 1: Yeah, it's fascinating what happened with gambling and how it

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Speaker 1: exploded with internet gambling. Fan Duel or dual fan is

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Speaker 1: out there and some other ones where the money is

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Speaker 1: astronomical and it's not just the over under and who's

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Speaker 1: gonna win. As you point out, well, let me give

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Speaker 1: you an example, Pete Rose, I was a gambler and

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Speaker 1: I ran in a couple of times at a restaurant

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Speaker 1: a friend of mine, a friend of mine owned, And

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Speaker 1: this is a guy who would bet on whether a

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Speaker 1: fly was going to land on a windowsill or not.

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Speaker 2: I'm serious, by the way. Yeah it sounds like him.

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Speaker 1: Yeah, it's completely out of control. And of course in

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Speaker 1: those days it was you know, you just dealt with

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Speaker 1: one guy. I'll bet you. Today you can make that

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Speaker 1: bet on the internet. It's that crazy. So now it

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Speaker 1: has hurt a lot of people. And I know at

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Speaker 1: the bottom of all these ads on TV, I look

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Speaker 1: at that gamble responsibly.

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Speaker 2: What the hell does that mean? And whoever pays attention.

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Speaker 3: To that, right, I mean almost nobody and when? And

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Speaker 3: the problem is, like what you're talking about, in the

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Speaker 3: Pete Rose era and even just in the five to

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Speaker 3: seven years ago era, if you wanted to gamble, like

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Speaker 3: you typically had to travel somewhere where it was legal

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Speaker 3: in many states, Like there's just no outlet for that desire.

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Speaker 3: And you might say, at least from like a libertarian perspective, Hey,

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Speaker 3: like people can and should be able to gamble if

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Speaker 3: they want gamble their life savings away. But from a

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Speaker 3: like societal goods standpoint, I am worried about the just

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Speaker 3: completely unregulated infomata.

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Speaker 2: It's gotten crazy. Yeah, it's getting crazy.

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Speaker 3: And when you think about what it's going to do

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Speaker 3: to individuals, to families, and to communities, it's it's just

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Speaker 3: it's just very worrisome. And that something like a billion

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Speaker 3: dollars being traded on the Super Bowl, well, I think

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Speaker 3: it's one thing if you're taking your entertainment dollars and

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Speaker 3: you are purposely using them to gamble instead of, let's say,

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Speaker 3: go out to eat. I just don't think that's how

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Speaker 3: most people think about gambling, especially because it can be

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Speaker 3: so addictive, and I think even more so with sports

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Speaker 3: bill because the average person sitting on their couch thinks

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Speaker 3: they know more than the next guy or gal sitting

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Speaker 3: on their couch down the street, and so they're betting

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Speaker 3: on well, of course, I know my guy is going

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Speaker 3: to hit a home run in this game, or this team,

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Speaker 3: my team is going to score at least seven runs

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Speaker 3: by the seventh inning, or whatever you're betting on, And

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Speaker 3: so I think it's even more nefarious sometimes in the

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Speaker 3: world of sports gambling because if you're an armchair quarterback

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Speaker 3: sitting there, you're watching, you just feel like you have

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Speaker 3: more insight about how your team's going to perform. And

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Speaker 3: I think that most of the time that's not true.

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Speaker 3: Though I love those disclaimers. I mean, no one pays

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Speaker 3: attention to disclaimers pharmaceutical disclaimers at the bottom. This will

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Speaker 3: cause death, that will cause rashes or oily stools, and

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Speaker 3: I happen to be a big fan of oily stools,

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Speaker 3: and it just it.

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Speaker 1: The disclaimer to me. I don't know why they do that. Okay,

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Speaker 1: moving on, four oh one K plans now particularly relevant

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Speaker 1: and really cool right now, and I and many others

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Speaker 1: are a huge fan of four oh one K plans,

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Speaker 1: especially matching money, So let's dive into that.

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Speaker 3: It's it's just kind of funny to me that the

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Speaker 3: four one K is having a moment because normally it's

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Speaker 3: seen as this super humdrum boring thing that we have

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Speaker 3: to talk about because it is one of those accounts

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Speaker 3: that the vast majority of Americans are if they want

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Speaker 3: to build wealth in the in the stock market, they're

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Speaker 3: going to do it through their four oh one K

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Speaker 3: at work. And but like, of course there's different things

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Speaker 3: that become zeitgeisty from time to time.

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Speaker 2: Four one ks are in it.

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Speaker 3: Right now, like they're they're the subject of different tick

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Speaker 3: to creations and Instagram reels, and there's there's this term

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Speaker 3: people are referring to right now called four one K mullets.

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Speaker 2: Have you heard that, Bill? I know it's some kind

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Speaker 2: of a haircut.

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Speaker 3: Well, so mullets are actually like apparently cool right now.

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Speaker 3: Not the Joe dirt kind of mullet, but apparently like

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Speaker 3: just like a suave mullet where you still have got

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Speaker 3: stuff going on to the front, but you got you know,

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Speaker 3: you leave it untrimmed in the back. And so people

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Speaker 3: are saying mullets and apparently quarter zips, which is like

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Speaker 3: a type of sweater you can wear. Those are really

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Speaker 3: hot right now, and so is the four to one K.

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Speaker 3: They're lumping the four O one K in with the

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Speaker 3: style icons that are currently out there, and I'm all

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Speaker 3: for it, man, whatever it takes to draw attention to

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Speaker 3: the four oh one K, the power that the four

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Speaker 3: oh one K, how powerful can be for you as

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Speaker 3: an individual when it comes to wealth building, especially if

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Speaker 3: you have a match from your company, I dig it.

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Speaker 2: I love that it's being talked about right now. Oh yeah, absolutely.

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Speaker 1: I mean I'm a huge, huge fan of four one

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Speaker 1: K plans and have been. I've been speaking of them

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Speaker 1: for a long time. By the way, first, when I

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Speaker 1: heard the term quarter zips, I thought it had something

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Speaker 1: to do with circumcisions. That is not the case. I

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Speaker 1: just wanted to point that out. But usually it's from

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Speaker 1: a company, a four oh one K plan. If you

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Speaker 1: work for a company, it's a three percent match or

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Speaker 1: a five percent match with very generous companies. And I

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Speaker 1: say that you put money into a four to oh

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Speaker 1: one K plan matching money you've made one hundred percent

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Speaker 1: that year, assuming that there is no income growth at all.

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Speaker 1: So people are crazy not to put money into four

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Speaker 1: oh one.

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Speaker 2: Ks one hundred percent.

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Speaker 3: And that's why if you go to ha to money

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Speaker 3: dot com and you click start here, we've got the

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Speaker 3: money gears is what will we call them. And the

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Speaker 3: first thing you need to do is save up a

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Speaker 3: very basic emergency fund of just over three grand. But

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Speaker 3: right after that, the second thing, the most important thing

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Speaker 3: on your path to building wealth is to get at

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Speaker 3: least the match from your company's four oh, one k, because,

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Speaker 3: like you said, it's this instant fifty or one hundred

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Speaker 3: percent return in most cases for people, and you want

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Speaker 3: to get to the point where you're getting the full

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Speaker 3: match from your employer, and for a lot of people,

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Speaker 3: then you're you're at this point where you're investing somewhere

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Speaker 3: between eight and twelve percent of your income combined with

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Speaker 3: what your employer's what your employer's tossing in there. Ideally,

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Speaker 3: you know, we want you to get past that. If

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Speaker 3: you continue down the money gears, you will be investing

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Speaker 3: more over time, but even just getting that company match.

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Speaker 3: Doing that over the course of a couple of decades,

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Speaker 3: you will be shocked, right, It's just kind of coming

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Speaker 3: out of your paycheck. That's the other cool thing is

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Speaker 3: like when you when you open up an IRA, you

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Speaker 3: have to like actively take money from your account and

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Speaker 3: stick it in with your with your four OL and K.

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Speaker 3: When you stick money in, you're you kind of almost

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Speaker 3: don't even notice it a little bit. Yeah, you don't

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Speaker 3: kill it, smaller, you don't feel it. And yet when

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Speaker 3: you go in there, and I think sometimes two people

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Speaker 3: who are just beginning the process, it can feel a

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Speaker 3: little demoralizing. Because you're sticking the money and you go

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Speaker 3: log in after six months and you're like, it's not

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Speaker 3: it's not that much money. But the way compounding returns work,

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Speaker 3: the longer you wait to go check your balo, you

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Speaker 3: come back in eight, ten, fifteen years later, you're going

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Speaker 3: to be shocked at how much money you've amassed. And

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Speaker 3: it's not based on just the money you put in there.

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Speaker 3: It's because it's invested in the stock market and the

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Speaker 3: return to the stock market, those returns are amplified and

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Speaker 3: you're creating just an incredible financial future for yourself through

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Speaker 3: this vehicle that has been set up to allow you

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Speaker 3: to build wealth in an efficient manner.

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Speaker 2: Real quickly.

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Speaker 1: Just for a second, tax ramifications money going into four

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Speaker 1: oh one k plan? Is that deductible off your income

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Speaker 1: or is it? Well explain real quickly.

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Speaker 3: So it depends whether you're going with a traditional or

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Speaker 3: wrothire a wroth for O one k. And so that's

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Speaker 3: worth noting too, is that most employers you can take

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Speaker 3: advantage of a wroth for oh onek these days. If

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Speaker 3: you go with the wroth, you're not getting a tax

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Speaker 3: break right now, you're paying the tax on the money

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Speaker 3: you stick into that account. If you go the tradition route,

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Speaker 3: you are getting a current year tax breaking you'll pay

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Speaker 3: tax later on down the road. So it's like, hey,

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Speaker 3: do I want to pay tax now? Do I want

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Speaker 3: to pay tax later? That's a really good question, and

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Speaker 3: so much of that depends on how much you're earning now,

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Speaker 3: what tax bracket you're in, and what your likely tax

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Speaker 3: bracket is going to be when you retire. It's not

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Speaker 3: like a super simple formula, but it's something worth considering,

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Speaker 3: and especially if you're in the early earning stages of

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Speaker 3: your career. I love for people to choose the Roth

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Speaker 3: vehicles because hey, if you're going to make more and

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Speaker 3: more and more, why not pay the tax now?

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Speaker 1: All right, Thanks Joel, It's always good stuff. I'll catch

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Speaker 1: you this Sunday, twelve to two o'clock right here on KFI.

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Speaker 2: Sounds good. Thanks Bill,