1 00:00:06,720 --> 00:00:10,760 Speaker 1: Tonight, we're tracking the financial impact now that we're heading 2 00:00:10,800 --> 00:00:14,400 Speaker 1: into week three in our war with Iran. You're listening 3 00:00:14,400 --> 00:00:16,680 Speaker 1: to Simply Money, presented by all Worth Financial. I'm Bob 4 00:00:16,720 --> 00:00:20,119 Speaker 1: spun Seller along with Brian James. Well, what is the 5 00:00:20,160 --> 00:00:22,599 Speaker 1: price of gas where you live? It seems to be 6 00:00:22,720 --> 00:00:25,239 Speaker 1: the talk of the town here in recent days. Will 7 00:00:25,320 --> 00:00:28,440 Speaker 1: prices go higher? Will they go lower? What's in store 8 00:00:28,560 --> 00:00:32,440 Speaker 1: for this week? Joining us to help us really understand 9 00:00:32,479 --> 00:00:35,120 Speaker 1: what's going on under the hood is all Worth Chief 10 00:00:35,120 --> 00:00:39,080 Speaker 1: investment Officer Andy Stout. Andy, get us updated on where 11 00:00:39,080 --> 00:00:42,199 Speaker 1: everything stands as it relates to the price of oil 12 00:00:42,400 --> 00:00:45,680 Speaker 1: and the ramifications for the economy, the stock market, oil 13 00:00:45,760 --> 00:00:50,120 Speaker 1: prices depending on how long this war with Iran drags on. 14 00:00:51,640 --> 00:00:53,720 Speaker 2: Well, that question you just gave me there, Bob, I 15 00:00:53,760 --> 00:00:56,440 Speaker 2: could probably spend a good half hour talking about it. 16 00:00:56,720 --> 00:00:58,840 Speaker 2: So we're just going to hit the high levels and 17 00:00:58,920 --> 00:01:02,480 Speaker 2: we'll drill down pun intended wherever. 18 00:01:02,680 --> 00:01:04,000 Speaker 3: See what you did there and do. 19 00:01:04,760 --> 00:01:06,960 Speaker 4: You catch on? That helps when you have to say 20 00:01:07,040 --> 00:01:08,080 Speaker 4: pun intended. 21 00:01:07,760 --> 00:01:11,160 Speaker 1: Right, Economist humor is sometimes the best humor. 22 00:01:13,040 --> 00:01:17,479 Speaker 2: Sometimes, yes, all right, So anyways, when we look at 23 00:01:17,480 --> 00:01:19,600 Speaker 2: the price of oil and we're we're at right now. 24 00:01:19,840 --> 00:01:22,720 Speaker 2: Obviously it's been trending higher, there's no question about it. 25 00:01:22,840 --> 00:01:26,119 Speaker 2: I mean, we were a little short of around seventy 26 00:01:26,160 --> 00:01:30,000 Speaker 2: dollars a barrel when this conflict started at the end 27 00:01:30,000 --> 00:01:33,360 Speaker 2: of February, and now we're right around one hundred dollars 28 00:01:33,640 --> 00:01:38,320 Speaker 2: a barrel, and that certainly creates some issues for people. 29 00:01:38,360 --> 00:01:40,120 Speaker 2: There's no question about it when you were looking at 30 00:01:40,160 --> 00:01:42,600 Speaker 2: the prices at the pump and what it means in general. 31 00:01:42,600 --> 00:01:47,600 Speaker 2: But broadly speaking, with oil where it's at right now, 32 00:01:48,680 --> 00:01:52,680 Speaker 2: assuming we don't stay here for the next you know, 33 00:01:53,640 --> 00:01:56,720 Speaker 2: year or so, or even drift higher from we're at 34 00:01:56,840 --> 00:02:00,000 Speaker 2: right now, it's still unlikely by itself to push us 35 00:02:00,080 --> 00:02:01,640 Speaker 2: into an economic recession. 36 00:02:01,720 --> 00:02:03,080 Speaker 4: Yes, you'll feel in your. 37 00:02:03,480 --> 00:02:05,720 Speaker 2: Wallet's a bit and when you look up at the 38 00:02:06,360 --> 00:02:10,080 Speaker 2: signs at the gas station, seeing maybe it's three fifty, three, seventy, 39 00:02:10,160 --> 00:02:12,799 Speaker 2: whatever it might be wherever you're living at you're going 40 00:02:12,880 --> 00:02:15,320 Speaker 2: to be feeling the pinch a little bit. But when 41 00:02:15,400 --> 00:02:18,399 Speaker 2: you think about it, you're really spending you know, every 42 00:02:18,440 --> 00:02:21,000 Speaker 2: week or so, maybe it's like five extra bucks on gas, 43 00:02:21,720 --> 00:02:25,240 Speaker 2: it has a bigger psychological impact then it does an 44 00:02:25,280 --> 00:02:28,800 Speaker 2: economic impact, and that can translate into other areas like 45 00:02:28,840 --> 00:02:33,040 Speaker 2: consumer sentiment and things like that. But broadly speaking, oil 46 00:02:33,320 --> 00:02:35,080 Speaker 2: we have to watch, we have to stay on top 47 00:02:35,120 --> 00:02:38,480 Speaker 2: of because of that impact on consumer cement, because of 48 00:02:38,480 --> 00:02:41,480 Speaker 2: what it could ultimately mean in terms of people pulling 49 00:02:41,560 --> 00:02:44,600 Speaker 2: spending back in some areas in. 50 00:02:44,360 --> 00:02:47,640 Speaker 4: Order to you know, pay the prices at the pump. 51 00:02:47,880 --> 00:02:51,040 Speaker 2: And when you put it all together, it is going 52 00:02:51,080 --> 00:02:53,919 Speaker 2: to have an impact on inflation. At this point, it 53 00:02:53,960 --> 00:02:56,880 Speaker 2: probably does not push us into a recession, but there's 54 00:02:56,880 --> 00:02:59,120 Speaker 2: still a lot of factors, you know that we need 55 00:02:59,120 --> 00:02:59,800 Speaker 2: to stay on top of. 56 00:03:00,040 --> 00:03:02,400 Speaker 3: Andy. What about the straight of Hoar moves. Last I checked, 57 00:03:02,400 --> 00:03:05,919 Speaker 3: they have not opened that up and really nothing has changed. 58 00:03:05,960 --> 00:03:09,400 Speaker 3: There's still lobbing projectiles at it from various directions. You 59 00:03:09,480 --> 00:03:12,960 Speaker 3: told us a few weeks ago that the really two 60 00:03:13,040 --> 00:03:15,600 Speaker 3: weeks is probably what we should be looking for before 61 00:03:15,639 --> 00:03:18,720 Speaker 3: we really worry about there being a permanent you know. 62 00:03:18,919 --> 00:03:21,239 Speaker 3: A result from that is that are we there yet? 63 00:03:21,240 --> 00:03:22,280 Speaker 3: Do you still worried about that? 64 00:03:23,480 --> 00:03:24,760 Speaker 4: Well? I am so worried about it. 65 00:03:24,760 --> 00:03:27,240 Speaker 2: I don't know if we use the word permanent, but 66 00:03:27,320 --> 00:03:30,480 Speaker 2: certainly more of a lasting impact. But when you look 67 00:03:30,520 --> 00:03:33,080 Speaker 2: at what has been going on, it hasn't been just 68 00:03:33,120 --> 00:03:34,960 Speaker 2: the strait of war moves and isolation. 69 00:03:35,040 --> 00:03:37,640 Speaker 4: There have been some other factors that you. 70 00:03:37,600 --> 00:03:44,040 Speaker 2: Know can help from a supply perspective. First is the 71 00:03:44,080 --> 00:03:48,080 Speaker 2: release of about four hundred million barrels of oil from 72 00:03:48,080 --> 00:03:52,040 Speaker 2: the International Energy Agency that was announced last week, including 73 00:03:52,040 --> 00:03:55,440 Speaker 2: one hundred and seventy two million from the US. That 74 00:03:55,520 --> 00:04:00,520 Speaker 2: actually corresponds to roughly twenty days of supply from Persian 75 00:04:00,520 --> 00:04:04,080 Speaker 2: Gulf area. So we are adding some supply from that perspective, 76 00:04:04,080 --> 00:04:04,600 Speaker 2: that's going. 77 00:04:04,480 --> 00:04:05,720 Speaker 4: To give some breathing room. 78 00:04:06,240 --> 00:04:10,000 Speaker 2: We've also weaving the US lifted some sanctions on Russian 79 00:04:10,240 --> 00:04:11,400 Speaker 2: oil shipments. 80 00:04:11,520 --> 00:04:13,880 Speaker 4: That means that we're allowing. 81 00:04:13,600 --> 00:04:17,599 Speaker 2: Certain shipments of oil that's already been loaded onto tankers 82 00:04:17,640 --> 00:04:19,599 Speaker 2: to be purchased by other countries. So they already had 83 00:04:19,640 --> 00:04:22,120 Speaker 2: to be loaded, I think it was prior to like 84 00:04:22,160 --> 00:04:25,280 Speaker 2: March twelfth or something like that, and that would help 85 00:04:25,440 --> 00:04:28,200 Speaker 2: essentially ease some of the supply issues in the Middle 86 00:04:28,240 --> 00:04:28,880 Speaker 2: East area. 87 00:04:29,320 --> 00:04:29,480 Speaker 4: Now. 88 00:04:29,520 --> 00:04:31,800 Speaker 2: The other thing we're looking at doing more locally, and 89 00:04:31,839 --> 00:04:34,120 Speaker 2: this has been done in other instances like when we've 90 00:04:34,120 --> 00:04:36,800 Speaker 2: seen hurricanes and things like that, is suspending what's called 91 00:04:36,800 --> 00:04:41,080 Speaker 2: a Jones Act. Now, suspending that doesn't increase oil supply 92 00:04:41,560 --> 00:04:43,919 Speaker 2: but the purpose of that is to move fuel around 93 00:04:44,000 --> 00:04:47,880 Speaker 2: the US more quickly. So normally only like US flagged 94 00:04:47,880 --> 00:04:51,359 Speaker 2: and approved ships can transport oil between US ports, but 95 00:04:51,400 --> 00:04:53,480 Speaker 2: there aren't too many of those ships. 96 00:04:53,360 --> 00:04:54,200 Speaker 4: That are allowed to do that. 97 00:04:54,240 --> 00:04:58,400 Speaker 2: So waiving these rules allows foreign tankers to move that 98 00:04:58,480 --> 00:05:01,240 Speaker 2: are already in our region to move gas and diesel 99 00:05:01,279 --> 00:05:04,560 Speaker 2: between US sports, essentially helping to prevent regional shortage. So 100 00:05:04,600 --> 00:05:10,040 Speaker 2: we have some you know, some logistical issues and benefits 101 00:05:10,040 --> 00:05:12,920 Speaker 2: from that perspective. Now, with all that being said, you're 102 00:05:12,920 --> 00:05:14,960 Speaker 2: one hundred percent right, the straight up horn moves is 103 00:05:15,000 --> 00:05:18,240 Speaker 2: still a critical choke point that there needs to be 104 00:05:18,279 --> 00:05:20,680 Speaker 2: a resolution, and I will probably see some sort of 105 00:05:20,720 --> 00:05:22,960 Speaker 2: resolution occurring in phases at least that's what a lot 106 00:05:22,960 --> 00:05:23,960 Speaker 2: of anals are thinking. 107 00:05:24,080 --> 00:05:26,400 Speaker 4: And by the way, I don't know if you all 108 00:05:26,440 --> 00:05:27,039 Speaker 4: saw it. 109 00:05:26,880 --> 00:05:29,799 Speaker 2: But over the weekend there were two Indian government linked 110 00:05:29,839 --> 00:05:33,440 Speaker 2: tankers that were allowed to pass through the waterway after 111 00:05:33,760 --> 00:05:38,320 Speaker 2: negotiations essentially between India and Iran where they allowed those 112 00:05:38,320 --> 00:05:40,640 Speaker 2: Indian tankers to pass through, and then he is trying 113 00:05:40,640 --> 00:05:43,400 Speaker 2: to get I think six more of their tankers through it. Now, 114 00:05:43,400 --> 00:05:46,320 Speaker 2: that doesn't obviously signal a broad reopening of the street 115 00:05:46,760 --> 00:05:48,719 Speaker 2: which has you know, to your point, been largely closed 116 00:05:48,760 --> 00:05:49,480 Speaker 2: for the past. 117 00:05:49,240 --> 00:05:52,120 Speaker 4: Couple of weeks. But it does suggest, and this is the. 118 00:05:52,040 --> 00:05:56,279 Speaker 2: Positive sign, that limited shipments could begin moving through, or 119 00:05:56,320 --> 00:06:00,480 Speaker 2: we could see negotiated arrangements or escorted arrangements, but still 120 00:06:00,560 --> 00:06:03,240 Speaker 2: any return to normal traffic. We're probably several weeks away 121 00:06:03,279 --> 00:06:06,080 Speaker 2: in all honesty. But as we make these moves in 122 00:06:06,120 --> 00:06:08,440 Speaker 2: these incremental stages and we get a little bit of 123 00:06:08,440 --> 00:06:11,640 Speaker 2: breathing room on the supply side, you know it will 124 00:06:11,680 --> 00:06:16,560 Speaker 2: be a big benefit and certainly delays the material economic 125 00:06:16,600 --> 00:06:18,839 Speaker 2: impact having elbot at oil prices may have. 126 00:06:19,680 --> 00:06:21,599 Speaker 1: All right, andy, so so far, I mean, if we 127 00:06:21,680 --> 00:06:23,159 Speaker 1: just look at a chart of the S and P 128 00:06:23,279 --> 00:06:27,520 Speaker 1: five hundred or the broad broad stock market indexes, this 129 00:06:27,600 --> 00:06:30,760 Speaker 1: thing really has not had an impact, a meaningful impact 130 00:06:30,880 --> 00:06:33,080 Speaker 1: on the stock market so far. Meaning if you look 131 00:06:33,120 --> 00:06:35,000 Speaker 1: at a chart of the S and P five hundred, 132 00:06:35,240 --> 00:06:38,480 Speaker 1: I mean, we're we've just been hovering around levels basically 133 00:06:38,520 --> 00:06:41,520 Speaker 1: the same level we were at back in October November 134 00:06:41,520 --> 00:06:44,720 Speaker 1: of twenty twenty five. So you know, to me, this 135 00:06:44,880 --> 00:06:48,719 Speaker 1: really hasn't negatively impacted the markets, you know that much. 136 00:06:48,760 --> 00:06:52,039 Speaker 1: And then secondly, if I look at crude oil futures, 137 00:06:52,040 --> 00:06:54,719 Speaker 1: And admitutedly I haven't done this for three or four 138 00:06:54,800 --> 00:06:56,560 Speaker 1: days now, but if you look if you go out 139 00:06:56,600 --> 00:07:00,479 Speaker 1: to the June July timeframe, crude oil future search trading, 140 00:07:00,560 --> 00:07:03,159 Speaker 1: you know, back down in that sixty to seventy level, 141 00:07:04,160 --> 00:07:06,840 Speaker 1: you know where you referenced they were trading at before 142 00:07:06,880 --> 00:07:10,680 Speaker 1: this conflict started. Is that still where crude oil futures 143 00:07:10,720 --> 00:07:14,160 Speaker 1: are priced today? And should we look at that as 144 00:07:14,240 --> 00:07:18,080 Speaker 1: kind of a discounting mechanism on if and when this 145 00:07:18,200 --> 00:07:20,800 Speaker 1: whole conflict is really going to start to impact the 146 00:07:20,880 --> 00:07:23,640 Speaker 1: overall economy in the stock market. 147 00:07:24,760 --> 00:07:27,760 Speaker 2: Yeah, so when you look at we're gonna take us 148 00:07:27,760 --> 00:07:30,440 Speaker 2: in a few different ways. First, you mentioned the S 149 00:07:30,480 --> 00:07:33,840 Speaker 2: and P five hundred or US stocks in general not 150 00:07:34,200 --> 00:07:38,559 Speaker 2: having essentially seen a big impact. I mean right now 151 00:07:39,360 --> 00:07:42,800 Speaker 2: as of Friday at least, we were down about three 152 00:07:42,880 --> 00:07:47,640 Speaker 2: percent for the year, so pretty minimal. And when you 153 00:07:47,680 --> 00:07:50,120 Speaker 2: look at where oil is trading, So when we talk 154 00:07:50,160 --> 00:07:53,400 Speaker 2: about oil trading at you know, one hundred dollars a barrel, 155 00:07:53,640 --> 00:07:57,200 Speaker 2: and then you talk about you know what that means 156 00:07:57,200 --> 00:08:00,760 Speaker 2: for future trading. That one hundred dollars are what's called 157 00:08:01,120 --> 00:08:03,280 Speaker 2: spot training. So we're training at right here, right now. 158 00:08:03,320 --> 00:08:06,000 Speaker 2: If you want to buy some oil today, you're going 159 00:08:06,040 --> 00:08:08,000 Speaker 2: to pay about one hundred dollars a roll. Now, if 160 00:08:08,000 --> 00:08:11,240 Speaker 2: you want to lock in future prices, you would actually 161 00:08:11,240 --> 00:08:13,880 Speaker 2: be paying a different level. Normally, the future prices are 162 00:08:13,960 --> 00:08:16,960 Speaker 2: higher than what they would be today, just for a 163 00:08:17,040 --> 00:08:18,360 Speaker 2: variety of economic reasons. 164 00:08:18,400 --> 00:08:20,720 Speaker 4: That would probably bore ninety percent of the listeners. It 165 00:08:20,760 --> 00:08:23,640 Speaker 4: would excite me, but it would bore most people. 166 00:08:23,800 --> 00:08:26,240 Speaker 2: But what we're seeing right now when we look at 167 00:08:26,360 --> 00:08:30,480 Speaker 2: where future prices are trading, So if you wanted to essentially. 168 00:08:30,080 --> 00:08:34,800 Speaker 5: Buy oil to be delivered, and we'll just say August 169 00:08:34,880 --> 00:08:38,520 Speaker 5: of this year, you would have to pay eighty dollars 170 00:08:38,520 --> 00:08:40,920 Speaker 5: a barrel, So you would actually pay less than what 171 00:08:40,960 --> 00:08:42,760 Speaker 5: it is right now if you needed to buy a day. 172 00:08:43,040 --> 00:08:46,080 Speaker 2: So what that is showing us is that the market 173 00:08:46,120 --> 00:08:50,720 Speaker 2: is pricing in supply relief and that things would essentially 174 00:08:50,800 --> 00:08:54,480 Speaker 2: get better. So that's suggesting. 175 00:08:54,120 --> 00:08:56,600 Speaker 4: That the markets see some sort of de escalation. 176 00:08:57,480 --> 00:09:00,959 Speaker 1: Yeah, all right, good information to ponder over. Obviously, none 177 00:09:00,960 --> 00:09:02,800 Speaker 1: of us know you know, if and when this is 178 00:09:02,840 --> 00:09:06,120 Speaker 1: all going to get resolved. Moving on to interest rates, 179 00:09:06,160 --> 00:09:08,560 Speaker 1: the Fed is going to make a decision on interest 180 00:09:08,600 --> 00:09:12,600 Speaker 1: rates this week, based on everything that's going on, wouldn't 181 00:09:12,600 --> 00:09:16,000 Speaker 1: you say there's a zero chance of any move by 182 00:09:16,040 --> 00:09:18,959 Speaker 1: the Fed in interest rates, you know, this time around 183 00:09:19,000 --> 00:09:21,440 Speaker 1: when they meet this this week. I mean, obviously there's 184 00:09:21,480 --> 00:09:22,800 Speaker 1: a lot of uncertainty out there. 185 00:09:24,000 --> 00:09:27,240 Speaker 2: Yeah, the markets that priced out interest rate cuts for 186 00:09:27,320 --> 00:09:29,960 Speaker 2: quite a long time in this March meeting, even before 187 00:09:30,880 --> 00:09:34,640 Speaker 2: the hostilities in the Middle East, and right now, there's 188 00:09:34,679 --> 00:09:37,360 Speaker 2: about a zero percent chance, yeah, that you do see 189 00:09:37,400 --> 00:09:40,160 Speaker 2: any sort of move. And when you just you know, 190 00:09:40,200 --> 00:09:42,400 Speaker 2: think about it, it's not too surprising because people are 191 00:09:42,400 --> 00:09:46,680 Speaker 2: worried about oil and inflation, and when you cut interest rates, 192 00:09:47,040 --> 00:09:52,679 Speaker 2: you honestly encourage inflation in general. You're not trying to 193 00:09:52,800 --> 00:09:57,800 Speaker 2: get inflation to go up. Well, if you cut rates, 194 00:09:57,880 --> 00:10:00,719 Speaker 2: essentially you have the higher risk of inflation going So 195 00:10:00,800 --> 00:10:03,880 Speaker 2: they're not going to do that with the oil prices 196 00:10:04,000 --> 00:10:06,439 Speaker 2: kind of on the horizon and people worried about that. 197 00:10:06,640 --> 00:10:10,280 Speaker 2: So just meeting is I want to say, it's completely pointless. 198 00:10:10,120 --> 00:10:13,400 Speaker 4: But you have this meeting in the next meeting. 199 00:10:13,280 --> 00:10:16,319 Speaker 2: In April, which is the end of April, probably also 200 00:10:17,120 --> 00:10:22,440 Speaker 2: relatively meaningless for all intentsive purposes, mainly because these are 201 00:10:22,559 --> 00:10:27,720 Speaker 2: the last two meetings for FED chair Jerome Powell before 202 00:10:27,760 --> 00:10:29,600 Speaker 2: his term ends as share. 203 00:10:30,080 --> 00:10:33,000 Speaker 4: Now, what that means for beyond. 204 00:10:34,160 --> 00:10:36,439 Speaker 2: Beyond the April meeting is that you do start to 205 00:10:36,480 --> 00:10:39,839 Speaker 2: see increasing chances of cuts because the new FEED chair 206 00:10:40,960 --> 00:10:43,760 Speaker 2: likely to be a point or not a point, but 207 00:10:43,880 --> 00:10:46,800 Speaker 2: likely to be confirmed by the scent. Kevin Warsh has 208 00:10:47,440 --> 00:10:50,520 Speaker 2: been vocal about being more open to rate cuts. But still, 209 00:10:50,559 --> 00:10:53,760 Speaker 2: even with that being said, markets aren't pricing in a 210 00:10:53,840 --> 00:10:56,200 Speaker 2: rate cut until the fourth quarter. 211 00:10:55,960 --> 00:10:56,600 Speaker 4: Of this year. 212 00:10:56,840 --> 00:10:59,320 Speaker 2: That will probably change in terms of market pricing, but 213 00:10:59,360 --> 00:11:00,800 Speaker 2: we'll see how that plays out. 214 00:11:01,040 --> 00:11:03,680 Speaker 3: Okay, Andy, I want to bring up the s word 215 00:11:03,880 --> 00:11:06,440 Speaker 3: stagflation straight out of the seventies and put on my 216 00:11:06,440 --> 00:11:08,840 Speaker 3: bell bottoms and make you talk about inflation in the seventies. 217 00:11:08,880 --> 00:11:11,800 Speaker 3: We keep seeing articles, you know, there's talking heads out 218 00:11:11,800 --> 00:11:14,520 Speaker 3: there referring to this is kind of shaping up where 219 00:11:14,520 --> 00:11:17,160 Speaker 3: we may wind up with a stagflation situation, which is 220 00:11:17,200 --> 00:11:22,440 Speaker 3: a fancy way for saying inflation without the accompanying economic growth. 221 00:11:22,920 --> 00:11:24,960 Speaker 3: Do you feel that that is on the horizon for us? 222 00:11:25,040 --> 00:11:27,600 Speaker 3: Is that on the table or is that just talking 223 00:11:27,640 --> 00:11:28,280 Speaker 3: heads talking. 224 00:11:29,720 --> 00:11:31,840 Speaker 2: I think if that were to be on the table, 225 00:11:32,040 --> 00:11:35,400 Speaker 2: we would have to see oil prices probably even higher 226 00:11:35,400 --> 00:11:38,000 Speaker 2: than where they are right now, and stay that way 227 00:11:38,040 --> 00:11:41,400 Speaker 2: for several months, so meaning more than four or five 228 00:11:41,480 --> 00:11:42,240 Speaker 2: six months. 229 00:11:42,320 --> 00:11:43,360 Speaker 4: So we would need to see. 230 00:11:43,160 --> 00:11:47,880 Speaker 2: Probably oil around one ten or higher for several months 231 00:11:47,880 --> 00:11:52,440 Speaker 2: before you actually see stagflation make its way into the economy. Now, 232 00:11:52,920 --> 00:11:55,280 Speaker 2: that doesn't mean that it can't happen. It just means 233 00:11:55,280 --> 00:11:57,880 Speaker 2: you're going to have to see a lot of things 234 00:11:57,920 --> 00:12:00,160 Speaker 2: come into place, and right now that appears to be 235 00:12:00,360 --> 00:12:03,840 Speaker 2: a low probability event of that occurring. I would talk 236 00:12:03,920 --> 00:12:07,320 Speaker 2: that up more to people looking for headlines and grabbing 237 00:12:07,360 --> 00:12:10,439 Speaker 2: eyeballs in order to get advertising money. 238 00:12:11,640 --> 00:12:13,720 Speaker 1: All right, Hey, we'll have to leave it there for tonight, Andy, 239 00:12:13,800 --> 00:12:16,560 Speaker 1: thank you as always for taking time to spend some 240 00:12:16,840 --> 00:12:20,160 Speaker 1: you know, give us some great perspective as always tonight. 241 00:12:20,960 --> 00:12:23,520 Speaker 1: Coming up next a troubling trend in four to one 242 00:12:23,600 --> 00:12:27,200 Speaker 1: ks that could impact you regardless of how much money 243 00:12:27,240 --> 00:12:30,520 Speaker 1: you have. Plus is your money as liquid as you 244 00:12:30,559 --> 00:12:33,440 Speaker 1: think it is. There's a new development in the quote 245 00:12:33,520 --> 00:12:36,640 Speaker 1: unquote alternative investment world that we want to make sure 246 00:12:36,640 --> 00:12:39,440 Speaker 1: we cover tonight. You're listening to Simply Money, presented by 247 00:12:39,480 --> 00:12:42,959 Speaker 1: all Worth Financial on fifty five KRC, the talk station 248 00:12:48,160 --> 00:12:50,960 Speaker 1: you're listening to Simply Money, presented by all Worth Financial. 249 00:12:50,960 --> 00:12:53,920 Speaker 1: I'm Bob sponseller along with Brian James. Hey, if you 250 00:12:53,920 --> 00:12:56,800 Speaker 1: can't listen to Simply Money every night, subscribe and get 251 00:12:56,800 --> 00:12:59,959 Speaker 1: our daily podcast. Just search Simply Money on the eye, 252 00:13:00,120 --> 00:13:04,960 Speaker 1: heart app, or wherever you find your podcasts. From higher 253 00:13:04,960 --> 00:13:09,960 Speaker 1: investment fees to inherited IRA tax traps and tough rental 254 00:13:10,040 --> 00:13:14,400 Speaker 1: property decisions, are you making the smartest move with your money? 255 00:13:14,559 --> 00:13:18,160 Speaker 1: We'll answer your questions straight ahead. A six forty three. 256 00:13:18,360 --> 00:13:21,240 Speaker 1: There's a troubling trend happening inside four oh one k 257 00:13:21,400 --> 00:13:24,880 Speaker 1: plans across America right now. And at first glance you 258 00:13:24,960 --> 00:13:28,600 Speaker 1: might think, well, that doesn't apply to me, but stick 259 00:13:28,640 --> 00:13:31,920 Speaker 1: with us on this. Brian, talk about this new article 260 00:13:31,920 --> 00:13:33,040 Speaker 1: in the Wall Street Journal. 261 00:13:33,240 --> 00:13:35,520 Speaker 3: Yep, you open your Wall Street Journal today, you'll see 262 00:13:35,800 --> 00:13:39,160 Speaker 3: some information about a record percentage of workers that are 263 00:13:39,160 --> 00:13:41,840 Speaker 3: actually starting to take hardship withdrawals from their four oh 264 00:13:41,920 --> 00:13:46,160 Speaker 3: one k's. Hardship withdrawal is basically the most four oh 265 00:13:46,200 --> 00:13:49,760 Speaker 3: one k's have the ability to allow you to pull 266 00:13:49,840 --> 00:13:52,840 Speaker 3: money out if you really have a serious situation, health problems, 267 00:13:52,880 --> 00:13:56,200 Speaker 3: those kinds of things. But this does not excuse you 268 00:13:56,240 --> 00:13:58,400 Speaker 3: from the taxes, and more importantly, doesn't excuse you from 269 00:13:58,400 --> 00:14:01,120 Speaker 3: the penalties. You'll still pay all that, but you're allowed 270 00:14:01,120 --> 00:14:03,400 Speaker 3: to access it again. Four one k's are all different, 271 00:14:03,400 --> 00:14:06,320 Speaker 3: but most of them offer this feature. Last year, about 272 00:14:06,360 --> 00:14:09,600 Speaker 3: six percent of participants tap their savings early for some 273 00:14:09,640 --> 00:14:11,560 Speaker 3: of these reasons. That really doesn't sound all that big, 274 00:14:12,200 --> 00:14:14,400 Speaker 3: but if you compare it to history, that number used 275 00:14:14,400 --> 00:14:17,280 Speaker 3: to be around two percent before the pandemic, so obviously 276 00:14:17,320 --> 00:14:19,800 Speaker 3: that has tripled three times as many people are needing 277 00:14:19,800 --> 00:14:22,280 Speaker 3: to tap into their long term savings for short term needs. 278 00:14:22,560 --> 00:14:25,680 Speaker 3: The average withdrawals about nineteen hundred dollars. This isn't people 279 00:14:25,720 --> 00:14:28,360 Speaker 3: cashing out their money and paying taxes and penalties to 280 00:14:28,360 --> 00:14:30,520 Speaker 3: buy a bote or a dream home. This is people 281 00:14:30,520 --> 00:14:33,440 Speaker 3: just covering the normal bills, rent, healthcare stuff, trying to 282 00:14:33,480 --> 00:14:36,560 Speaker 3: avoid eviction, those kinds of things. So you know it's 283 00:14:36,560 --> 00:14:38,680 Speaker 3: going to continue to snowball. Who knows. But at the 284 00:14:38,680 --> 00:14:40,840 Speaker 3: same time, there's obviously a lot of people out there 285 00:14:40,840 --> 00:14:42,560 Speaker 3: who are pretty much stretched to the limit. I don't 286 00:14:42,560 --> 00:14:44,240 Speaker 3: think that's too much of a shock for anybody to hear. 287 00:14:45,120 --> 00:14:47,280 Speaker 1: No, And I think coming out of the pandemic and 288 00:14:47,680 --> 00:14:50,720 Speaker 1: again this is not a political comment, it's just an 289 00:14:50,760 --> 00:14:55,240 Speaker 1: economic comment. I mean, we did accumulate about twenty percent 290 00:14:55,280 --> 00:14:58,400 Speaker 1: of accumulated inflation here in a short period of time, 291 00:14:58,440 --> 00:15:01,400 Speaker 1: and that is very hard for people to recover from, 292 00:15:02,000 --> 00:15:04,880 Speaker 1: especially people that are just trying to get started in life. 293 00:15:05,040 --> 00:15:07,120 Speaker 1: You know, people that might have some college debt or 294 00:15:07,160 --> 00:15:10,280 Speaker 1: credit card debt, or again just people that earn a 295 00:15:10,320 --> 00:15:12,880 Speaker 1: lower income and are trying to keep their heads above water, 296 00:15:13,000 --> 00:15:16,560 Speaker 1: living paycheck to paycheck, and so it's it's really not 297 00:15:16,680 --> 00:15:19,720 Speaker 1: a surprise that these folks are still trying to recover 298 00:15:19,840 --> 00:15:23,840 Speaker 1: from that inflation. And that's the cruel thing about inflation is, 299 00:15:24,320 --> 00:15:27,040 Speaker 1: you know, unless we go into a severe recession that 300 00:15:27,200 --> 00:15:30,040 Speaker 1: causes people to lose their jobs and a whole lot 301 00:15:30,080 --> 00:15:34,480 Speaker 1: of other big problems, that inflation never goes away. It accumulates, 302 00:15:34,520 --> 00:15:38,240 Speaker 1: and it just hopefully accumulates at a lower percentage rate 303 00:15:38,360 --> 00:15:41,600 Speaker 1: like what we're experiencing right now. So just something to 304 00:15:41,640 --> 00:15:44,560 Speaker 1: keep an eye on. And that leads to the next, 305 00:15:44,680 --> 00:15:47,280 Speaker 1: you know topic that will we need to make sure 306 00:15:47,320 --> 00:15:50,360 Speaker 1: we talk about for everybody, depending on what your net 307 00:15:50,400 --> 00:15:55,080 Speaker 1: worth level is, and that's you know liquidity, so you know, 308 00:15:55,200 --> 00:15:58,560 Speaker 1: high net worth folks. Yeah, are you taking hard hardship, 309 00:15:58,640 --> 00:16:01,800 Speaker 1: require hardship with raws from your four one k's right now? 310 00:16:02,120 --> 00:16:06,760 Speaker 1: Probably not. But it leads us to another topic about 311 00:16:06,920 --> 00:16:10,600 Speaker 1: private credit that Briant, you and I got on this 312 00:16:10,720 --> 00:16:13,440 Speaker 1: show months and months and months ago when this started 313 00:16:13,480 --> 00:16:16,880 Speaker 1: to rear its ugly head as an investment option. And 314 00:16:17,280 --> 00:16:20,320 Speaker 1: you know, we talk about all the time the fees 315 00:16:20,440 --> 00:16:23,640 Speaker 1: and the illiquidity involved with these things. When you venture 316 00:16:23,680 --> 00:16:27,040 Speaker 1: into this private credit space and lo and behold, we're 317 00:16:27,080 --> 00:16:27,840 Speaker 1: starting to see it. 318 00:16:28,560 --> 00:16:31,840 Speaker 3: Yeah, so this is filtering through what we just talked about. 319 00:16:32,120 --> 00:16:34,040 Speaker 3: You know, people needing to access their four O one 320 00:16:34,120 --> 00:16:37,400 Speaker 3: k's early for whatever reason. Well, companies need the same thing. 321 00:16:37,480 --> 00:16:41,760 Speaker 3: So private credit exists to support public credit, meaning you 322 00:16:41,800 --> 00:16:44,160 Speaker 3: know companies that sell bonds on the public markets. That's 323 00:16:44,360 --> 00:16:47,000 Speaker 3: that's a way of financing a business, borrowing money from 324 00:16:47,080 --> 00:16:49,560 Speaker 3: public investors. Private's a little bit different. I means you're 325 00:16:49,560 --> 00:16:52,880 Speaker 3: not using the actual stock markets stock and bond markets 326 00:16:52,920 --> 00:16:56,240 Speaker 3: to put that debt out there. You're making arrangements directly 327 00:16:56,360 --> 00:17:00,120 Speaker 3: with individual investors, not on an exchange or something like that. 328 00:17:00,240 --> 00:17:02,760 Speaker 3: That's private credit. The reason the company might do that, well, 329 00:17:02,800 --> 00:17:05,919 Speaker 3: maybe they're struggling a little bit to have. Maybe they 330 00:17:05,920 --> 00:17:08,920 Speaker 3: don't have the right credit rating, the right financial situation 331 00:17:09,000 --> 00:17:11,920 Speaker 3: to support more traditional debt. Why are we talking about 332 00:17:11,960 --> 00:17:14,160 Speaker 3: this this morning. Well, there's a big fund out there, 333 00:17:14,400 --> 00:17:17,560 Speaker 3: Blackrocks private credit fund. Blackrock is one of our trillionaires 334 00:17:17,600 --> 00:17:19,800 Speaker 3: out there. You've probably heard of them. They took a 335 00:17:19,800 --> 00:17:22,480 Speaker 3: step to limit investor withdrawals from one of their larger 336 00:17:22,520 --> 00:17:25,920 Speaker 3: private credit vehicles. That's a twenty six billion dollar fund, 337 00:17:26,000 --> 00:17:29,119 Speaker 3: Billion with a B. After requests surge, they decided to 338 00:17:29,119 --> 00:17:32,480 Speaker 3: turn off the spigot, so shareholders were asking to redeem 339 00:17:32,520 --> 00:17:34,680 Speaker 3: about nine percent of their shares, that's one point two 340 00:17:34,680 --> 00:17:38,240 Speaker 3: billion dollars. Management capped these repurchases though, at five percent 341 00:17:38,240 --> 00:17:41,960 Speaker 3: of the fund. That's pretty typical, but it's an interesting move, 342 00:17:42,480 --> 00:17:44,520 Speaker 3: something that kind of unexpected. If you're used to your 343 00:17:44,800 --> 00:17:47,440 Speaker 3: normal traditional individual bonds or bond funds and you've dipped 344 00:17:47,440 --> 00:17:49,399 Speaker 3: a toe in private credit, this is one of the 345 00:17:49,400 --> 00:17:51,520 Speaker 3: things that can happen. It's not going to necessarily be 346 00:17:51,600 --> 00:17:54,199 Speaker 3: as liquid as you might have anticipated. Is this a 347 00:17:54,240 --> 00:17:58,000 Speaker 3: reason to go screaming for the away from all these things? 348 00:17:58,160 --> 00:18:01,120 Speaker 3: Not necessarily, but it's something to be aware of that Again, 349 00:18:01,160 --> 00:18:02,720 Speaker 3: you may not be accustomed to. There are pros and 350 00:18:02,760 --> 00:18:04,920 Speaker 3: cons to all these types of investments. If you are here, 351 00:18:04,960 --> 00:18:07,159 Speaker 3: if you own this fund or other ones, you know 352 00:18:07,200 --> 00:18:09,840 Speaker 3: there's another one. Blue al Capital is another big one. 353 00:18:09,840 --> 00:18:13,720 Speaker 3: They've also restricted and sometimes completely stop redemptions because of 354 00:18:13,720 --> 00:18:16,639 Speaker 3: these requests. So that's a sign that there's a liquidity 355 00:18:16,640 --> 00:18:19,399 Speaker 3: mismatch happening in the private credit space. So just be 356 00:18:19,600 --> 00:18:21,879 Speaker 3: just don't be surprised, and just be nimble and be 357 00:18:21,920 --> 00:18:23,720 Speaker 3: ready for the unexpected in this world. 358 00:18:24,200 --> 00:18:25,960 Speaker 1: Yeah, and this is a good time to point out, 359 00:18:26,000 --> 00:18:28,159 Speaker 1: you know, go back to why people are interested in 360 00:18:28,200 --> 00:18:30,760 Speaker 1: this space in the first place. One, when people hear 361 00:18:30,880 --> 00:18:34,960 Speaker 1: private credit, yep, it sounds sexy. You're getting access to 362 00:18:35,680 --> 00:18:39,320 Speaker 1: asset classes and categories that quote unquote high net worth 363 00:18:39,359 --> 00:18:42,600 Speaker 1: people can get access to, and people want to participate, 364 00:18:43,080 --> 00:18:45,280 Speaker 1: and there's kind of a fear of missing out. I mean, 365 00:18:45,320 --> 00:18:48,320 Speaker 1: people jump into these things because they perceive that they're 366 00:18:48,320 --> 00:18:50,920 Speaker 1: going to get a higher rate of return. And while 367 00:18:50,960 --> 00:18:54,680 Speaker 1: everything's sailing along, you know, smooth sailing, no problems, yep, 368 00:18:54,760 --> 00:18:57,560 Speaker 1: sometimes you can get a higher return. But Brian, we've 369 00:18:57,600 --> 00:19:00,760 Speaker 1: been seeing in the last several weeks, if not couple months, 370 00:19:00,800 --> 00:19:04,199 Speaker 1: that with all these hyper scalers in this AI space 371 00:19:04,320 --> 00:19:07,800 Speaker 1: trying to build out and build out rapidly, they've had 372 00:19:07,800 --> 00:19:10,439 Speaker 1: to go get access to credit wherever they can get it. 373 00:19:10,880 --> 00:19:14,040 Speaker 1: And you know, like what happened with the housing crisis, 374 00:19:14,080 --> 00:19:17,000 Speaker 1: when the music stops and it's time to find a 375 00:19:17,080 --> 00:19:20,800 Speaker 1: chair the last, there's going to be somebody that can't 376 00:19:20,840 --> 00:19:23,600 Speaker 1: find a place to sit down. And if you multiply 377 00:19:23,760 --> 00:19:28,160 Speaker 1: that with or you dovetail that with having a real 378 00:19:28,240 --> 00:19:31,399 Speaker 1: liquidity need for your family, you can get left holding 379 00:19:31,440 --> 00:19:34,760 Speaker 1: the bag. And that's exactly what's happening to some unsuspecting 380 00:19:34,800 --> 00:19:38,199 Speaker 1: folks right now in this whole private credit space. So 381 00:19:38,600 --> 00:19:41,440 Speaker 1: here's the all wad device. The lesson isn't, as Brian said, 382 00:19:41,480 --> 00:19:45,960 Speaker 1: to avoid alternatives altogether. It's understand what you own, Understand 383 00:19:46,000 --> 00:19:49,600 Speaker 1: how it can behave in stressful situations, and then make 384 00:19:49,640 --> 00:19:53,480 Speaker 1: a decision whether you could live without accessing that capital 385 00:19:53,560 --> 00:19:56,280 Speaker 1: for a while because you might get subject to lock ups. 386 00:19:57,119 --> 00:19:59,520 Speaker 1: All right, think of financial scam won't happen to you. 387 00:19:59,600 --> 00:20:02,439 Speaker 1: We'll sh know you how criminals are targeting those with 388 00:20:02,560 --> 00:20:06,440 Speaker 1: a healthy nest egg. Specifically, right now, you're listening to 389 00:20:06,480 --> 00:20:09,520 Speaker 1: simply money presented by all Worth Financial on fifty five KRC. 390 00:20:10,080 --> 00:20:19,280 Speaker 1: The talk station you're listening to Simply Money, presented by 391 00:20:19,320 --> 00:20:22,480 Speaker 1: all Worth Financial on Bob Sponseller along with Brian James 392 00:20:23,200 --> 00:20:25,800 Speaker 1: Well like, growing number of people out there say they've 393 00:20:25,880 --> 00:20:29,360 Speaker 1: experienced some form of financial fraud over the past year, 394 00:20:30,000 --> 00:20:35,840 Speaker 1: especially older and more affluent Americans, despite taking a variety 395 00:20:35,880 --> 00:20:41,360 Speaker 1: of precautions to protect themselves, bank Rate's latest national survey 396 00:20:41,520 --> 00:20:45,800 Speaker 1: has found some interesting numbers Among older, more affluent folks. 397 00:20:45,840 --> 00:20:49,240 Speaker 3: Brian so four and ten US adults say they've experienced 398 00:20:49,880 --> 00:20:52,280 Speaker 3: some type of financial fraud over the past year, and 399 00:20:52,400 --> 00:20:54,600 Speaker 3: about half of them at least fifty five years old, 400 00:20:54,600 --> 00:20:57,280 Speaker 3: set in the past twelve months, somebody attempted to actually 401 00:20:57,359 --> 00:21:01,080 Speaker 3: access their personal financial information, or maybe they spent money 402 00:21:01,160 --> 00:21:02,880 Speaker 3: on something that turned out to be a phony service. 403 00:21:02,920 --> 00:21:05,320 Speaker 3: In other words, the transaction was legitimate from a standpoint 404 00:21:05,359 --> 00:21:07,399 Speaker 3: of that person thought it was legit, but the service 405 00:21:07,440 --> 00:21:09,840 Speaker 3: itself was not a little slightly different from somebody just 406 00:21:09,880 --> 00:21:12,639 Speaker 3: playing just playing stealing your money. So that's up about 407 00:21:12,680 --> 00:21:16,680 Speaker 3: thirteen percent since last year. About seventy percent of people 408 00:21:16,960 --> 00:21:19,480 Speaker 3: have seen a financial scam or fraud at some point 409 00:21:19,600 --> 00:21:22,479 Speaker 3: in their lives. That is, up from thirty four percent 410 00:21:22,560 --> 00:21:25,679 Speaker 3: and sixty eight percent, respectively. This comes from a similar 411 00:21:25,720 --> 00:21:28,400 Speaker 3: bank rate survey that ran last year. Point of it is, hey, 412 00:21:28,400 --> 00:21:30,159 Speaker 3: guess what, there's more fraud out there than there was 413 00:21:30,200 --> 00:21:30,640 Speaker 3: in the past. 414 00:21:30,680 --> 00:21:33,200 Speaker 1: Go figure, Brian, those are crazy numbers. 415 00:21:33,240 --> 00:21:33,600 Speaker 4: Fifty. 416 00:21:33,600 --> 00:21:35,920 Speaker 1: I don't care whether you use fifty or sixty or 417 00:21:35,960 --> 00:21:38,520 Speaker 1: sixty two or seventy or more. It's just playing more. 418 00:21:38,600 --> 00:21:43,399 Speaker 1: But that's a lot of people working well. And you know, 419 00:21:43,440 --> 00:21:46,199 Speaker 1: we have Dave Hatter on here all the time, and 420 00:21:46,240 --> 00:21:49,199 Speaker 1: for good reason. They every time people seem like they 421 00:21:49,280 --> 00:21:52,200 Speaker 1: have their arms around this, there's another way to get 422 00:21:52,200 --> 00:21:54,240 Speaker 1: at people in their money. And Brian, you and I 423 00:21:54,280 --> 00:21:57,920 Speaker 1: are seeing this, you know, periodically with our clients. They're 424 00:21:57,960 --> 00:22:01,360 Speaker 1: getting these strange texts on their phone or phone calls. 425 00:22:01,440 --> 00:22:04,479 Speaker 1: I mean, it's a real thing out there. And you know, 426 00:22:04,600 --> 00:22:07,240 Speaker 1: especially I'll just say to folks there out there who 427 00:22:07,240 --> 00:22:12,000 Speaker 1: are maybe caring for parents or elderly loved ones, you 428 00:22:12,200 --> 00:22:14,840 Speaker 1: really need to pay attention to this because it is. 429 00:22:15,359 --> 00:22:18,159 Speaker 1: It's everywhere at this point, and it's something we really 430 00:22:18,200 --> 00:22:21,080 Speaker 1: need to factor in and just consider it. You know, 431 00:22:21,240 --> 00:22:26,840 Speaker 1: Identity protection account protection is just a standard operating procedure 432 00:22:27,119 --> 00:22:31,040 Speaker 1: as part of a good financial planning process. Brian talk 433 00:22:31,119 --> 00:22:36,480 Speaker 1: about this latest scam, you know, involving AI, voice, impersonation, 434 00:22:36,640 --> 00:22:38,720 Speaker 1: all this stuff. I mean, it's going to even get worse. 435 00:22:38,880 --> 00:22:41,000 Speaker 3: Yeah, And there's some big voices weighing in here. So 436 00:22:41,080 --> 00:22:44,680 Speaker 3: Kathy Stokes leads the fraud prevention at the AARP, the 437 00:22:44,720 --> 00:22:48,520 Speaker 3: Associating Association for Retired Persons. She says, scammers are more 438 00:22:48,560 --> 00:22:51,040 Speaker 3: and more using A and I to snatch some personal 439 00:22:51,240 --> 00:22:53,360 Speaker 3: personal informations. They're not even having to put their own 440 00:22:53,400 --> 00:22:57,159 Speaker 3: effort into it. It's just computer stealing information. So this 441 00:22:57,520 --> 00:23:00,480 Speaker 3: is this new text technology. It just makes it makes 442 00:23:00,520 --> 00:23:03,560 Speaker 3: a lot of times, makes these things nearly nearly entirely 443 00:23:03,600 --> 00:23:06,600 Speaker 3: imperceptible to the person who is ultimately the victim here. 444 00:23:06,880 --> 00:23:10,080 Speaker 3: And you know, it can be quicker, they can get 445 00:23:10,160 --> 00:23:13,760 Speaker 3: to a victim more quickly because these AI tools can 446 00:23:13,800 --> 00:23:16,919 Speaker 3: cycle through the people who would catch on. 447 00:23:17,040 --> 00:23:17,240 Speaker 4: Right. 448 00:23:17,400 --> 00:23:19,840 Speaker 3: So, one thing that always amazes me is how silly 449 00:23:19,960 --> 00:23:23,320 Speaker 3: some of these scams seem, how dumb and how obvious 450 00:23:23,359 --> 00:23:25,840 Speaker 3: in my mind. Right, So I did read I read 451 00:23:25,840 --> 00:23:28,000 Speaker 3: a study a while ago saying that is that is 452 00:23:28,040 --> 00:23:30,399 Speaker 3: by design, It's not because the scammers are stupid They 453 00:23:30,400 --> 00:23:32,399 Speaker 3: make it very obvious because they want to weed out 454 00:23:32,480 --> 00:23:36,080 Speaker 3: the person who, you know, the least intelligent person out 455 00:23:36,080 --> 00:23:37,760 Speaker 3: there who could still catch on. They want to get 456 00:23:37,840 --> 00:23:39,560 Speaker 3: rid of that person as much as possible, so they're 457 00:23:39,560 --> 00:23:40,960 Speaker 3: down to the ones who will never see it coming. 458 00:23:41,240 --> 00:23:43,960 Speaker 3: So they make it so obvious that the normal people 459 00:23:43,960 --> 00:23:46,960 Speaker 3: will filter themselves out, and the people who again are 460 00:23:46,960 --> 00:23:49,480 Speaker 3: just not gonna know what to do, are the ones 461 00:23:49,480 --> 00:23:51,359 Speaker 3: that they're still working with. So there's a reason for 462 00:23:51,440 --> 00:23:54,200 Speaker 3: all that more technology here. Voice cloning, this one was 463 00:23:54,280 --> 00:23:57,200 Speaker 3: really scary. So just a few seconds of audio. Maybe 464 00:23:57,200 --> 00:23:59,879 Speaker 3: you've done the podcast appearance. I'm feeling a little attacked 465 00:23:59,920 --> 00:24:03,680 Speaker 3: right now, Bob. Maybe we've both been exposing ourselves unwittingly. 466 00:24:04,119 --> 00:24:06,680 Speaker 3: If you're on YouTube, maybe just your voicemail, greeting, social 467 00:24:06,720 --> 00:24:09,879 Speaker 3: media videos. AI can clone your voice based off of 468 00:24:09,960 --> 00:24:12,520 Speaker 3: just a few words that you've said out there. So 469 00:24:12,600 --> 00:24:15,320 Speaker 3: scammers are using that sometimes. You know this isn't happening 470 00:24:15,359 --> 00:24:18,560 Speaker 3: all that frequently, but it's possible. You can calling a 471 00:24:18,560 --> 00:24:20,960 Speaker 3: set of grandparents pretending to be that grandchild who just 472 00:24:21,000 --> 00:24:23,119 Speaker 3: got busted for something and is in jail needs the 473 00:24:23,200 --> 00:24:27,040 Speaker 3: bail money, impersonating a CEO, asking for an urgent wire transfer. 474 00:24:27,359 --> 00:24:30,240 Speaker 3: Maybe it's a financial advisor requesting some account movement. Money 475 00:24:30,240 --> 00:24:33,040 Speaker 3: moving around this voice, it sounds real. It's all based 476 00:24:33,040 --> 00:24:36,639 Speaker 3: off of technology that mimics your tone, your cadence, even emotions. 477 00:24:36,920 --> 00:24:39,600 Speaker 3: Executives and business owners, this is a major, major wire 478 00:24:39,640 --> 00:24:41,560 Speaker 3: fraud risk because if they can get to one of 479 00:24:41,600 --> 00:24:44,199 Speaker 3: your underlings, that person is probably not going to want 480 00:24:44,200 --> 00:24:47,320 Speaker 3: to slow things down for you for a significant financial transaction. 481 00:24:47,480 --> 00:24:50,479 Speaker 3: So all of these things sound crazy, they sound far fetched, 482 00:24:50,640 --> 00:24:53,160 Speaker 3: but they do happen, and we've got to be vigilant. 483 00:24:53,400 --> 00:24:57,200 Speaker 1: Well, you mentioned the example of somebody calling you an 484 00:24:57,200 --> 00:25:01,080 Speaker 1: older lady saying that their son was in prison. I've 485 00:25:01,119 --> 00:25:04,720 Speaker 1: had that happen. I've had that exact situation happen. And 486 00:25:05,280 --> 00:25:09,239 Speaker 1: she she almost cut loose of seven thousand dollars, and 487 00:25:09,720 --> 00:25:12,280 Speaker 1: you know, by the grace of God, her son called 488 00:25:12,320 --> 00:25:14,240 Speaker 1: her out of the blue while she was in the 489 00:25:14,240 --> 00:25:16,879 Speaker 1: middle of this transaction, and so she was able to 490 00:25:16,960 --> 00:25:19,399 Speaker 1: quickly learn that, yep, this was a scam. I actually 491 00:25:19,400 --> 00:25:21,960 Speaker 1: have my son on the phone, and thank God, she 492 00:25:22,080 --> 00:25:23,720 Speaker 1: was able to get out of this whole thing before 493 00:25:23,760 --> 00:25:25,680 Speaker 1: she cut loose of the money. But it's really. 494 00:25:25,680 --> 00:25:28,080 Speaker 3: Seven thousand was a test. If that had gone through, 495 00:25:28,119 --> 00:25:30,240 Speaker 3: there would have been another request for a lot more money. 496 00:25:30,320 --> 00:25:33,320 Speaker 1: So I'll you know, I'm not a techie. I'm not 497 00:25:33,359 --> 00:25:35,840 Speaker 1: a tech expert. We'll get Dave Hatter on here again 498 00:25:35,920 --> 00:25:38,679 Speaker 1: soon to talk about this. But Brian, what I tell people, 499 00:25:39,160 --> 00:25:41,760 Speaker 1: do not get on the phone with anybody unless you 500 00:25:41,840 --> 00:25:44,879 Speaker 1: know exactly who it is. If it's not somebody in 501 00:25:44,920 --> 00:25:49,199 Speaker 1: your contact list, do not answer the phone. That's the 502 00:25:49,240 --> 00:25:51,440 Speaker 1: safest way to be. And I think Dave Hatter said 503 00:25:51,800 --> 00:25:54,560 Speaker 1: exactly those same things the last time we had him 504 00:25:54,560 --> 00:25:55,440 Speaker 1: on the show. Am I right? 505 00:25:55,600 --> 00:25:57,639 Speaker 3: Oh yeah, that is a huge topic for Dave and 506 00:25:57,640 --> 00:26:00,359 Speaker 3: he's fortunately, fortunately he's out there on that wall looking 507 00:26:00,359 --> 00:26:03,040 Speaker 3: to protect us all with by sharing these this information. 508 00:26:02,920 --> 00:26:05,600 Speaker 1: Other things is just you know, and it gets irritating. 509 00:26:05,640 --> 00:26:09,080 Speaker 1: People don't like it. But you know, multi level authentication 510 00:26:09,480 --> 00:26:15,040 Speaker 1: for logins on your accounts, getting everything verified through a 511 00:26:15,080 --> 00:26:17,760 Speaker 1: third party before money is wired or sent out. I 512 00:26:17,800 --> 00:26:20,240 Speaker 1: know we do that here at all Worths. Sometimes people 513 00:26:20,280 --> 00:26:23,000 Speaker 1: don't like it, Hopefully they understand why we do it. 514 00:26:23,280 --> 00:26:25,080 Speaker 1: You just got you got to protect your money. Here's 515 00:26:25,080 --> 00:26:27,560 Speaker 1: the all Worth advice. The more you have, the more 516 00:26:27,640 --> 00:26:31,720 Speaker 1: discipline your safeguards need to be slow down, don't be 517 00:26:31,760 --> 00:26:36,320 Speaker 1: in a hurry and verify, Verify, verify before you move 518 00:26:36,480 --> 00:26:40,760 Speaker 1: any of your money. Coming up next, when couples clash 519 00:26:40,960 --> 00:26:45,720 Speaker 1: on different levels of risk tolerance, When rental income looks 520 00:26:45,720 --> 00:26:49,840 Speaker 1: tempting and that ten year IRA rule looming out there, 521 00:26:50,000 --> 00:26:53,840 Speaker 1: How do families avoid making costly mistakes? We'll tackle all 522 00:26:53,880 --> 00:26:56,359 Speaker 1: of that next. You're listening to Simply Money presented by 523 00:26:56,400 --> 00:27:04,000 Speaker 1: all Worth Financial fifty five KRC the talk station. You're 524 00:27:04,040 --> 00:27:06,680 Speaker 1: listening to Simply Money presented by all Worth Financial. I'm 525 00:27:06,680 --> 00:27:09,600 Speaker 1: Bob Sponseller along with Brian James. Do you have a 526 00:27:09,600 --> 00:27:12,159 Speaker 1: financial question you'd luck for us to answer. There's a 527 00:27:12,200 --> 00:27:14,800 Speaker 1: red button you could click while you're listening to the show. 528 00:27:14,920 --> 00:27:18,479 Speaker 1: If you're listening on the iHeart app, simply record your 529 00:27:18,560 --> 00:27:21,560 Speaker 1: question and it will come straight to us. All right. 530 00:27:21,600 --> 00:27:24,520 Speaker 1: Brian Eric in Lebanon leads us off tonight. He says, 531 00:27:24,520 --> 00:27:27,040 Speaker 1: we've got about two million dollars saved, but most of 532 00:27:27,080 --> 00:27:31,400 Speaker 1: it is in traditional retirement accounts. How do I evaluate 533 00:27:31,440 --> 00:27:35,160 Speaker 1: whether we're too exposed to future tax risk? 534 00:27:35,240 --> 00:27:38,000 Speaker 3: Well, you evaluate evaluated by asking us that question, and 535 00:27:38,040 --> 00:27:39,639 Speaker 3: I come back with a quick answer of yes, you 536 00:27:39,680 --> 00:27:42,480 Speaker 3: are too exposed to future tax risks. Don't kick yourself 537 00:27:42,480 --> 00:27:44,760 Speaker 3: too hard because you didn't really have a choice. We 538 00:27:44,960 --> 00:27:47,000 Speaker 3: don't know much about eric situation other than what he 539 00:27:47,119 --> 00:27:49,679 Speaker 3: just asked us. But anybody with two million dollars, and 540 00:27:49,760 --> 00:27:53,119 Speaker 3: you specifically use the word traditional, which I'm interpreting as 541 00:27:53,200 --> 00:27:55,960 Speaker 3: pre tax dollars that have never been paid taxes on, 542 00:27:56,600 --> 00:27:59,399 Speaker 3: then you worked very hard and you took advantage of 543 00:27:59,400 --> 00:28:01,320 Speaker 3: the markets and all those kinds of things that doesn't 544 00:28:01,320 --> 00:28:04,600 Speaker 3: happen by accident, barring some company stock that maybe is 545 00:28:04,600 --> 00:28:07,760 Speaker 3: in this that somehow exploded or something like that. I'm 546 00:28:07,800 --> 00:28:10,840 Speaker 3: assuming you're just somebody who did your job for many 547 00:28:10,880 --> 00:28:13,919 Speaker 3: decades and you've got this nice, solid nest egg. You 548 00:28:13,960 --> 00:28:16,080 Speaker 3: did not have a choice. There was no Roth side 549 00:28:16,080 --> 00:28:17,960 Speaker 3: of things back in the day when you started. Assuming 550 00:28:17,960 --> 00:28:19,760 Speaker 3: my assumptions are correct, So don't kick yourself too hard. 551 00:28:19,800 --> 00:28:22,080 Speaker 3: You still got two million in the bank. That said 552 00:28:22,480 --> 00:28:24,560 Speaker 3: you are a kind of a sitting duck for our 553 00:28:24,640 --> 00:28:27,480 Speaker 3: least favorite tax, which is ordinary income tax. All they 554 00:28:27,520 --> 00:28:29,480 Speaker 3: got to do is change that bracket to any darned 555 00:28:29,480 --> 00:28:32,120 Speaker 3: thing they want. You know, I often hear people saying, well, 556 00:28:32,160 --> 00:28:34,200 Speaker 3: I don't trust Roth because they can double tax that 557 00:28:34,280 --> 00:28:35,840 Speaker 3: whenever they want. Sure, but the first thing they're going 558 00:28:35,880 --> 00:28:37,959 Speaker 3: to do is raise the brackets on ordinary income. If 559 00:28:38,000 --> 00:28:40,680 Speaker 3: we get an administration that wants to do that, they're 560 00:28:40,720 --> 00:28:42,600 Speaker 3: not going to double tax ROTH that already has a 561 00:28:42,600 --> 00:28:47,160 Speaker 3: bad stigma attached to it, but they will raise the 562 00:28:47,200 --> 00:28:50,400 Speaker 3: taxes on the traditional side, so you're already exposed. That said, 563 00:28:50,600 --> 00:28:53,960 Speaker 3: when you retire, there hopefully will be a window for you, 564 00:28:54,000 --> 00:28:56,280 Speaker 3: maybe your early sixties, where you've got the ability to 565 00:28:56,320 --> 00:28:57,840 Speaker 3: live off of something else for a while. You'll be 566 00:28:57,880 --> 00:29:00,680 Speaker 3: in your lowest bracket you've seen in des I'm assuming 567 00:29:00,720 --> 00:29:03,080 Speaker 3: a decent amount of income based on the nestegg you've built, 568 00:29:03,720 --> 00:29:06,000 Speaker 3: so that's the time to look at conversions to ROTH. 569 00:29:06,560 --> 00:29:08,760 Speaker 3: After you retire, when the salaries are gone or at 570 00:29:08,800 --> 00:29:13,280 Speaker 3: least significantly reduced, but before your requirementimum distributions kick in, 571 00:29:13,320 --> 00:29:15,800 Speaker 3: and ideally before you start your Social Security spigot. If 572 00:29:15,840 --> 00:29:17,280 Speaker 3: you can get a couple of years, those are the 573 00:29:17,360 --> 00:29:19,240 Speaker 3: years to start doing the conversions. You'll be in the 574 00:29:19,240 --> 00:29:22,000 Speaker 3: lowest brackets you've ever seen. Don't be shocked by the 575 00:29:22,040 --> 00:29:24,800 Speaker 3: idea of writing a fat check to the irs voluntarily 576 00:29:24,840 --> 00:29:26,400 Speaker 3: on purpose. It's the only way you're going to free 577 00:29:26,440 --> 00:29:28,600 Speaker 3: those dollars from taxes for the rest of your life. 578 00:29:28,680 --> 00:29:31,479 Speaker 3: So start running some numbers and kick that around and 579 00:29:31,560 --> 00:29:33,440 Speaker 3: maybe give us a call. We'll help you figure out 580 00:29:33,440 --> 00:29:36,480 Speaker 3: what the math is. So moving on to Mark and Anderson, 581 00:29:36,720 --> 00:29:38,560 Speaker 3: Mark says he's got a fund in their portfolio that 582 00:29:38,560 --> 00:29:40,400 Speaker 3: has a little bit of a higher expense ratio, but 583 00:29:40,640 --> 00:29:42,840 Speaker 3: it does seem to have outperformed the other things he's got. 584 00:29:43,320 --> 00:29:45,680 Speaker 3: So how do you evaluate, Bob, whether that extra cost 585 00:29:45,880 --> 00:29:46,760 Speaker 3: is justified. 586 00:29:47,880 --> 00:29:50,800 Speaker 1: Well, Mark, here's how I answered that, or would answer that. 587 00:29:51,000 --> 00:29:53,240 Speaker 1: First of all, good job for having one of these 588 00:29:53,920 --> 00:29:57,240 Speaker 1: higher performing, outperforming funds, because I'll tell you, if you 589 00:29:57,240 --> 00:30:01,120 Speaker 1: look long over the long term, less than one third 590 00:30:01,680 --> 00:30:05,760 Speaker 1: of all actively managed funds you know, outperform their benchmark 591 00:30:05,840 --> 00:30:09,360 Speaker 1: index NETA fees. So you know, maybe you're really good 592 00:30:09,360 --> 00:30:11,800 Speaker 1: at picking funds, or maybe you have a good advisor 593 00:30:11,880 --> 00:30:14,000 Speaker 1: that helped you pick those funds. So, first of all, 594 00:30:14,040 --> 00:30:17,480 Speaker 1: good job. The question I'd come back to you on 595 00:30:17,760 --> 00:30:20,640 Speaker 1: is how long has that fund been outperforming? Has it 596 00:30:20,680 --> 00:30:23,360 Speaker 1: outperformed for just the last one year or three years, 597 00:30:23,440 --> 00:30:25,920 Speaker 1: or five years, look at the last ten or twenty years, 598 00:30:25,960 --> 00:30:28,600 Speaker 1: and then look at a trend. What tends to happen 599 00:30:28,640 --> 00:30:33,160 Speaker 1: with these outperforming funds is they'll overweight to a particular 600 00:30:33,280 --> 00:30:35,840 Speaker 1: sector of the market and they guess right for a 601 00:30:35,880 --> 00:30:38,560 Speaker 1: short period of time. And that's where that you know, 602 00:30:38,760 --> 00:30:42,000 Speaker 1: the industry term is alpha, that performance alpha comes in. 603 00:30:42,400 --> 00:30:45,480 Speaker 1: You've been right, You've picked a sector in the short 604 00:30:45,560 --> 00:30:48,440 Speaker 1: term and it's outperformed. That's why you want to look 605 00:30:48,480 --> 00:30:51,880 Speaker 1: back and look at the consistent outperformance. And that to 606 00:30:51,960 --> 00:30:54,800 Speaker 1: me is how you, you know, justify whether it's worth 607 00:30:54,800 --> 00:30:58,800 Speaker 1: paying that cost. Again, most funds do not outperform NETA 608 00:30:58,800 --> 00:31:02,080 Speaker 1: fees over the law term. Some do, you know, but 609 00:31:02,120 --> 00:31:04,440 Speaker 1: look at look at the long term performance and then 610 00:31:04,480 --> 00:31:08,040 Speaker 1: look at the trend and see if it's worth hanging 611 00:31:08,040 --> 00:31:10,719 Speaker 1: on to and paying those extra costs. And if it 612 00:31:10,800 --> 00:31:13,640 Speaker 1: is good for you, I'd keep going. I'd keep you know, 613 00:31:13,840 --> 00:31:17,120 Speaker 1: using what you're using, all right, Greg and Westchester says, 614 00:31:17,200 --> 00:31:21,120 Speaker 1: my wife and I disagree about how much portfolio risk 615 00:31:21,200 --> 00:31:24,640 Speaker 1: to take. Now that our retirement is getting closer and closer. 616 00:31:24,800 --> 00:31:30,480 Speaker 1: How do couples reconcile different risk tolerances without having constant 617 00:31:30,520 --> 00:31:33,160 Speaker 1: tension between us? Brian, this is a great question and 618 00:31:33,200 --> 00:31:35,600 Speaker 1: one that we we talk about in meetings in our 619 00:31:35,640 --> 00:31:36,560 Speaker 1: office from time to time. 620 00:31:36,600 --> 00:31:39,320 Speaker 3: Absolutely, I often refer to myself as an unlicensed marriage 621 00:31:39,360 --> 00:31:41,680 Speaker 3: counselor versus a financial advisor. This kind of stuff comes 622 00:31:41,760 --> 00:31:44,240 Speaker 3: up all the time. First off, pats on the back 623 00:31:44,280 --> 00:31:46,440 Speaker 3: to both of you for having had the conversation to 624 00:31:46,520 --> 00:31:49,479 Speaker 3: begin with. Many married couples just don't even talk about it. 625 00:31:49,480 --> 00:31:51,720 Speaker 3: One person does all the financial stuff, the other person 626 00:31:52,520 --> 00:31:55,160 Speaker 3: is really just somewhat oblivious. So I'm just glad that 627 00:31:55,200 --> 00:31:57,480 Speaker 3: you've sat down and you shared your opinions with each other. 628 00:31:57,520 --> 00:32:00,600 Speaker 3: First off, So they again very proud of very common 629 00:32:00,640 --> 00:32:03,960 Speaker 3: problem here. And I think the way I encourage people 630 00:32:03,960 --> 00:32:05,680 Speaker 3: to think about it is, let's not think in terms 631 00:32:05,720 --> 00:32:09,360 Speaker 3: necessarily of how much risk is built into a portfolio? Right, 632 00:32:09,400 --> 00:32:10,840 Speaker 3: how much could it go up and down? That's an 633 00:32:10,840 --> 00:32:12,760 Speaker 3: important topic, and I'm not saying don't consider it, but 634 00:32:12,800 --> 00:32:16,040 Speaker 3: don't start there. Figure out first of all, when are 635 00:32:16,120 --> 00:32:19,520 Speaker 3: the dollar whatever I've exposed to risk? When are those 636 00:32:19,600 --> 00:32:22,760 Speaker 3: dollars likely to play a direct role in giving me 637 00:32:22,800 --> 00:32:25,880 Speaker 3: a monthly check or taking distribution. If we're talking about 638 00:32:25,920 --> 00:32:28,160 Speaker 3: money that we know we're not going to need for five, six, 639 00:32:28,280 --> 00:32:32,200 Speaker 3: seven years, then absolutely it's okay. To take more risk 640 00:32:32,200 --> 00:32:34,000 Speaker 3: than you might be comfortable with, just understand what that 641 00:32:34,080 --> 00:32:37,120 Speaker 3: impact would be. A lot of times, the person who 642 00:32:37,200 --> 00:32:39,960 Speaker 3: is a little more risk averse isn't necessarily concerned about 643 00:32:40,000 --> 00:32:43,120 Speaker 3: the ups and downs directly. They're concerned about when does 644 00:32:43,160 --> 00:32:44,640 Speaker 3: that bill get paid? How do we pay the bills? 645 00:32:44,640 --> 00:32:46,480 Speaker 3: If the market takes a twenty percent hit, as it 646 00:32:46,520 --> 00:32:49,600 Speaker 3: did in twenty twenty two and actually earlier in twenty five, 647 00:32:50,240 --> 00:32:53,080 Speaker 3: then how will we get those that next month's bill paid. Well, 648 00:32:53,120 --> 00:32:54,680 Speaker 3: the answer there is, let's just make sure those are 649 00:32:54,720 --> 00:32:56,120 Speaker 3: not the dollars in the first place that you be 650 00:32:56,120 --> 00:32:58,760 Speaker 3: paying bills with. So this is where we Bob and 651 00:32:58,760 --> 00:33:01,080 Speaker 3: I often say, sit down to figure out what dollars 652 00:33:01,080 --> 00:33:03,840 Speaker 3: are coming to win and make sure that those particular 653 00:33:03,880 --> 00:33:05,680 Speaker 3: dollars are arranged in a way that they're going to 654 00:33:05,760 --> 00:33:09,840 Speaker 3: be there relatively unaffected when that bill comes due. That 655 00:33:09,960 --> 00:33:13,400 Speaker 3: means all the other unassociated dollars can be invested a 656 00:33:14,120 --> 00:33:18,560 Speaker 3: little more aggressively. So it's not one necessarily one asset 657 00:33:18,560 --> 00:33:21,760 Speaker 3: allocation across all of your accounts. It is this pile 658 00:33:21,760 --> 00:33:23,920 Speaker 3: of money is for this These are the bills that's 659 00:33:23,920 --> 00:33:26,320 Speaker 3: going to cover, and therefore it's got a very low 660 00:33:26,560 --> 00:33:29,360 Speaker 3: risk profile to this investment. These other ones over here, 661 00:33:29,600 --> 00:33:31,080 Speaker 3: this we don't have a target for it. So this 662 00:33:31,120 --> 00:33:33,640 Speaker 3: is our ten fifteen to twenty year inflation fighting money 663 00:33:33,720 --> 00:33:36,080 Speaker 3: that can be more aggressive. Just make sure everybody agrees 664 00:33:36,120 --> 00:33:38,800 Speaker 3: on which pile is for what? Got time for one 665 00:33:38,840 --> 00:33:41,440 Speaker 3: super quick? When David and Milford says he's considering selling 666 00:33:41,440 --> 00:33:44,480 Speaker 3: a rental property that nets him about twenty thousand a year, Bob, 667 00:33:44,520 --> 00:33:47,440 Speaker 3: how would you compare that stable cash flow against that 668 00:33:47,520 --> 00:33:48,720 Speaker 3: tax hit from selling out of that? 669 00:33:49,200 --> 00:33:52,800 Speaker 1: Well, anytime, David, you got this rental property situation, and 670 00:33:52,880 --> 00:33:55,000 Speaker 1: we see this come up often. I mean you're correct 671 00:33:55,040 --> 00:33:57,240 Speaker 1: me from wrong, David, but you're kind of weighing two 672 00:33:57,360 --> 00:34:00,320 Speaker 1: or three things at once here. One the cash flows rate. 673 00:34:00,600 --> 00:34:03,400 Speaker 1: You probably depreciated this rental property, which is why you 674 00:34:03,440 --> 00:34:06,360 Speaker 1: got a really low cost basis, and you probably don't 675 00:34:06,400 --> 00:34:08,640 Speaker 1: want to fool around with some of the maintenance in 676 00:34:08,719 --> 00:34:11,760 Speaker 1: repair options. So you're juggling a couple of things at once, 677 00:34:12,960 --> 00:34:15,040 Speaker 1: and so you've got to count the cost the cost 678 00:34:15,120 --> 00:34:18,480 Speaker 1: benefit analysis of getting out from under having to manage 679 00:34:18,480 --> 00:34:22,960 Speaker 1: this rental property. One thought that sometimes people use There 680 00:34:22,960 --> 00:34:25,759 Speaker 1: are ten thirty one exchange programs out there where you 681 00:34:25,840 --> 00:34:29,040 Speaker 1: can move the rental property, sell it, and then have 682 00:34:29,120 --> 00:34:34,560 Speaker 1: that move into a more passively managed actively managed by 683 00:34:34,600 --> 00:34:39,360 Speaker 1: a manager, but passively managed by you real estate investment trusts, 684 00:34:39,360 --> 00:34:44,080 Speaker 1: so you can hopefully come close to replicating that income, 685 00:34:44,520 --> 00:34:47,279 Speaker 1: save yourselves on some taxes, and make your life a 686 00:34:47,280 --> 00:34:49,440 Speaker 1: lot simpler in the process. So those are just a 687 00:34:49,520 --> 00:34:52,680 Speaker 1: couple of thoughts coming up next, where those who are 688 00:34:52,680 --> 00:34:56,840 Speaker 1: retiring right now are moving? And why you're listening to 689 00:34:56,840 --> 00:34:59,279 Speaker 1: Simply Money presented by all Worth Financial on fifty five 690 00:34:59,360 --> 00:35:07,000 Speaker 1: KRC the talk station. You're listening to Simply Money out 691 00:35:07,000 --> 00:35:09,520 Speaker 1: of my all Worth Financial on Bob Sponseller Alone with 692 00:35:09,640 --> 00:35:13,200 Speaker 1: Brian Chains. Well, let's face it, for decades now, the 693 00:35:13,239 --> 00:35:16,520 Speaker 1: retirement playbook was pretty simple. Move south, go to that 694 00:35:16,560 --> 00:35:21,160 Speaker 1: warmer weather, some cases, pay no state income tax whatsoever. 695 00:35:21,239 --> 00:35:25,440 Speaker 1: But today the math is more complicated, and that bears 696 00:35:25,480 --> 00:35:28,960 Speaker 1: out in a new survey Brian as to where people 697 00:35:29,280 --> 00:35:32,160 Speaker 1: who are retiring right now, where are they actually going 698 00:35:32,200 --> 00:35:32,880 Speaker 1: and why. 699 00:35:33,400 --> 00:35:37,600 Speaker 3: Well, why does this organization do this survey? For obvious reasons? 700 00:35:37,640 --> 00:35:40,240 Speaker 3: This is coming from Allied Van Lines of all people, 701 00:35:40,280 --> 00:35:42,279 Speaker 3: you know, the people who rent out the trucks that 702 00:35:42,560 --> 00:35:44,720 Speaker 3: people use the whole where all the bodies are buried, 703 00:35:44,719 --> 00:35:46,960 Speaker 3: to all their plastic tubs of garbage all over the 704 00:35:47,000 --> 00:35:48,920 Speaker 3: country and stick them in a garage never to be 705 00:35:48,960 --> 00:35:52,760 Speaker 3: opened again. Anyway. Allied has just released their annual US 706 00:35:52,800 --> 00:35:55,959 Speaker 3: Migration report, tracking where Americans are moving to, of course 707 00:35:56,000 --> 00:35:57,600 Speaker 3: based on where they pick up the truck and where 708 00:35:57,600 --> 00:36:00,279 Speaker 3: they drop it off. So for Ohio folks, the story 709 00:36:00,320 --> 00:36:02,919 Speaker 3: is a little bit mixed. The state continues to see 710 00:36:03,000 --> 00:36:06,520 Speaker 3: more outbound than inbound moves. Overall. That's not happy news 711 00:36:06,560 --> 00:36:11,440 Speaker 3: there this evening. But here's the nuance. Major metro areas Cincinnati, Columbus, 712 00:36:11,440 --> 00:36:15,360 Speaker 3: and Cleveland are significant destinations inside that movement. So people 713 00:36:15,360 --> 00:36:19,040 Speaker 3: are moving from the rural areas to the more the 714 00:36:19,120 --> 00:36:22,080 Speaker 3: larger metropolitan areas. It doesn't mean the downtown areas necessarily, 715 00:36:22,400 --> 00:36:25,840 Speaker 3: but the larger metropolitin areas. Yes, people are leaving Ohio, 716 00:36:25,880 --> 00:36:28,200 Speaker 3: but at the same time, people are also moving within 717 00:36:28,320 --> 00:36:31,839 Speaker 3: Ohio toward the major cities. So their data shows that 718 00:36:32,000 --> 00:36:34,360 Speaker 3: the reason for these moves tends. Retirement tends to be 719 00:36:34,400 --> 00:36:36,960 Speaker 3: a key motivator. Hence why we're talking about it. That 720 00:36:37,239 --> 00:36:40,960 Speaker 3: usually historically meant Sun Belt states Florida, Carolina's Arizona and 721 00:36:40,960 --> 00:36:43,880 Speaker 3: so forth. But now we're starting to see indicators that 722 00:36:43,920 --> 00:36:48,200 Speaker 3: the broader migration is also reflecting cost of living sensitive sensitivity, 723 00:36:48,400 --> 00:36:51,640 Speaker 3: housing affordability, and tax considerations. So that makes it a 724 00:36:51,640 --> 00:36:53,680 Speaker 3: little more complex for high net worth families. Bob. 725 00:36:54,520 --> 00:36:57,360 Speaker 1: Yeah, And let's be clear, for the Ohio data. In 726 00:36:57,600 --> 00:37:01,040 Speaker 1: kentucky's not much different. I saw as a similar study 727 00:37:01,080 --> 00:37:03,000 Speaker 1: to this over the weekend. It's just happened to run 728 00:37:03,040 --> 00:37:06,239 Speaker 1: across it. The move here is subtle, and to me, 729 00:37:06,520 --> 00:37:09,800 Speaker 1: Ohio and Kentucky are still great places to live. There's 730 00:37:09,840 --> 00:37:13,440 Speaker 1: not a lot of people moving out. I think the 731 00:37:13,480 --> 00:37:16,480 Speaker 1: reason people move out is still weather. Let's face it, 732 00:37:16,760 --> 00:37:20,000 Speaker 1: you got to find subplace to go between January and April. 733 00:37:20,280 --> 00:37:22,319 Speaker 1: In my opinion, at least go on a vacation if 734 00:37:22,360 --> 00:37:25,239 Speaker 1: you live in Ohio. But I don't want people to 735 00:37:25,280 --> 00:37:29,840 Speaker 1: think that there's this mass exodus out of Cincinnati or 736 00:37:29,880 --> 00:37:32,800 Speaker 1: northern Kentucky. But that's not you know, because that's not happening. 737 00:37:32,840 --> 00:37:37,280 Speaker 1: But there is starting to be a huge disparity here 738 00:37:37,480 --> 00:37:40,800 Speaker 1: in how income is taxed and the cost of living 739 00:37:40,840 --> 00:37:44,120 Speaker 1: in terms of housing in various parts of the countries 740 00:37:44,160 --> 00:37:48,319 Speaker 1: South Carolina, North Carolina, and Tennessee, where the states with 741 00:37:48,400 --> 00:37:52,800 Speaker 1: the highest rates of inbound moves during twenty twenty five, 742 00:37:53,320 --> 00:37:58,160 Speaker 1: according to Allied Van Lines. And you know that trend 743 00:37:58,200 --> 00:38:02,560 Speaker 1: toward North Carolina has been happening now for a few years. Cincinnati, Cleveland, 744 00:38:02,600 --> 00:38:07,000 Speaker 1: and Columbus drew new residents from cities such as Chicago, Seattle, 745 00:38:07,080 --> 00:38:10,000 Speaker 1: and Washington, DC. That has to be somewhat of a 746 00:38:10,080 --> 00:38:10,600 Speaker 1: tax play. 747 00:38:10,760 --> 00:38:11,960 Speaker 3: That's all cost of living too. 748 00:38:12,040 --> 00:38:15,319 Speaker 1: I think while those moving out favored Phoenix and other 749 00:38:15,400 --> 00:38:18,040 Speaker 1: cities got to be because of weather. All right, thanks 750 00:38:18,080 --> 00:38:20,600 Speaker 1: for listening tonight. You've been listening to Simply Money, presented 751 00:38:20,600 --> 00:38:23,879 Speaker 1: by all Worth Financial on fifty five KRC, the talk 752 00:38:23,920 --> 00:38:24,160 Speaker 1: station