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Speaker 1: Your number one tree set on the iHeartRadio app.

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Speaker 2: It makes it easy to stay connected because I just.

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Speaker 3: Put on the app.

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Speaker 1: Fifty five KARC the talk station.

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Speaker 4: Tonight Marcus react to government shutdown news, How to react

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Speaker 4: to a possible change to your four to one k

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Speaker 4: and we answer your questions. You're listening to Simply Money

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Speaker 4: presented by Alworth Financial. I'm Bob Sponseller along with Brian James.

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Speaker 2: Well.

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Speaker 4: It appears that the government could be back open for

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Speaker 4: business later this week. It sounds like it at this point.

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Speaker 4: Joining us right now is all Worth Chief Investment Officer

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Speaker 4: Andy Stout to provide the economic implications of this news.

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Speaker 4: It's been a pretty active news flow over the weekend. Andy,

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Speaker 4: bring us up to speed here on the status of

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Speaker 4: the government shutdown.

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Speaker 3: Well, I'm sure most of us probably saw the news

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Speaker 3: last night where the Senate has basically agreed to a

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Speaker 3: solution to move things forward. They got some Democrat senators

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Speaker 3: on board with the Republicans and you get to the

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Speaker 3: necessary votes. Now moving on to the next step where

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Speaker 3: essentially going to the House for approval.

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Speaker 5: That'll probably happen sometime this week.

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Speaker 3: The timing is still a bit unclear as to when

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Speaker 3: that will happen, but after the House likely approves, then

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Speaker 3: it will go to the President to sign. Now, what

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Speaker 3: that means in all likelihood is that the government probably

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Speaker 3: reopened sometime around the middle of the week. And from

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Speaker 3: my perspective obviously, well, first of all, obviously that's good

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Speaker 3: news for those people.

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Speaker 5: Who are for a load and have missed the paychecks.

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Speaker 3: From an economic standpoint, when looking at the data that

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Speaker 3: we've been missing, we have now finally a bit of

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Speaker 3: clarity on the horizon. Now probably won't see anything this

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Speaker 3: week in terms of economic data being released because I remember,

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Speaker 3: the government has to recall all the staff and then

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Speaker 3: they got to start to put all the data, collect

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Speaker 3: the data, put all the data together, and then we

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Speaker 3: can start to see some information line CPI, GDP retail sales,

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Speaker 3: But don't expect anything this week.

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Speaker 5: Most likely it'll be a data.

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Speaker 3: The floodgates are going to open really over the next

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Speaker 3: couple of weeks in regards to data, and that's going

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Speaker 3: to be very beneficial for the Federal Reserve as they,

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Speaker 3: you know, try to figure out whether or not the

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Speaker 3: economy is chugging along or is finding a bit more

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Speaker 3: crafts When they start to look at the actual data.

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Speaker 3: You know, some of that cracks we've been seeing are

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Speaker 3: on the labor side, and so getting some official data

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Speaker 3: is going to be beneficial.

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Speaker 6: So Andy, this doesn't actually, if I'm not mistaken, we're

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Speaker 6: kicking the can a little bit here, right, I mean,

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Speaker 6: this is gonna This does not resolve the issue that

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Speaker 6: the Democrats want, which is the the the extension of

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Speaker 6: the subsidies for the Obamacare premiums. But we're basically committing

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Speaker 6: to have a vote on that at some point in

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Speaker 6: the future. Is that is that part of this is

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Speaker 6: I'm not mistaken, We're going to be having this conversation

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Speaker 6: again in the next over the next six weeks, right.

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Speaker 5: Yeah, that is definitely part of that.

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Speaker 3: And then also this is a continuation for the government

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Speaker 3: to reopen. Is really just through the end of January.

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Speaker 3: So market on your calendars now for maybe some additional

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Speaker 3: well I don't know if i'll say volatility, but definitely

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Speaker 3: some tension when it comes to the political framework.

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Speaker 4: All right, Andy, let's get into some data that we

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Speaker 4: actually do have, and I want to talk about household debt.

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Speaker 4: It looks like household debt climb to a record eighteen

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Speaker 4: point six trillion dollars in the third quarter. That's about

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Speaker 4: a three point six percent increase from a year ago.

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Speaker 2: Even though that's at.

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Speaker 4: A new new high, the pace is roughly in line

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Speaker 4: with three point seven percent wage growth over the last year.

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Speaker 4: So the data on the surface of it suggests that

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Speaker 4: consumers are not over extending themselves at a high level

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Speaker 4: at this point. But with the student loans having to

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Speaker 4: be repaid now after the repayment pause you know under

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Speaker 4: the last administration, that's where at least it appears that

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Speaker 4: we're seeing some cracks here because we're seeing some delinquencies

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Speaker 4: on these student loan payments.

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Speaker 2: It just sounds like the.

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Speaker 4: Lower end, you know, entry level consumers in this economy

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Speaker 4: that are saddled with student loan debt and everything else

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Speaker 4: trying to get started. Those are the people that are

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Speaker 4: really struggling right now, and that might explain some of

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Speaker 4: the election results in New York City last week.

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Speaker 3: Yeah, when you look at just the overall big picture

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Speaker 3: in terms of the consumer and the consumer's health, I mean,

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Speaker 3: really spending has been keeping the economy going. Consumer spending

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Speaker 3: represents about sunny percent of the economy. But when you

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Speaker 3: look at some of the data that we've got very recently,

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Speaker 3: and I say data we've got, it might seem kind

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Speaker 3: of weird. However, that's because we haven't been getting hardly

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Speaker 3: any data. But we've been getting data from some other

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Speaker 3: sources like private parties, private companies, but also from the

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Speaker 3: Federal Reserve, because the Federal Reserve is not affected by

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Speaker 3: the shutdown, and the Federal Wazer posts this consumer data. Yeah,

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Speaker 3: what it did show was that when you look at

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Speaker 3: the household debt hit another record eighteen point six trillion

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Speaker 3: for the third quarter. Now the first thing people think, oh, no,

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Speaker 3: another household debt record level. Keep in mind, these are

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Speaker 3: in what's what we call nominal terms, so they're not

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Speaker 3: adjusted for inflation. Now, when we look at inflation that's

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Speaker 3: out there, we look at wage growth, we look at

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Speaker 3: just general prices. Basically, this three point six percent growth

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Speaker 3: is pretty much in line with what wage growth has been.

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Speaker 3: So it's not as if consumers are really going too

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Speaker 3: far out over their skis compared to where they were

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Speaker 3: at least last quarter. So it's not really a macro

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Speaker 3: threat when you look at the total data. However, when

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Speaker 3: we look at certain subsectors of the data of the

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Speaker 3: debt levels, like student loans, that's a bit concerning credit cards.

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Speaker 5: That's also a bit concerning.

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Speaker 3: So like on credit card debt, you know, that jumped

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Speaker 3: almost six percent, so definitely more than wage growth, definitely

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Speaker 3: more than just general inflation. And also the delinquency and

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Speaker 3: I'll look at the serious delinquency rate, so that's credit

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Speaker 3: card balance is more than ninety days past due. You know,

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Speaker 3: those are right around seven percent, and that's pretty much

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Speaker 3: where they were, but it's still a relatively high level,

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Speaker 3: especially compared to just a bigger history. Normally that credit

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Speaker 3: card debt, you know, might be closer to some lower

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Speaker 3: levels when you look at it, it's usually around i'll

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Speaker 3: call it five percent in that general area going back

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Speaker 3: to about two thousand and three. So credit card debt

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Speaker 3: is a concern. Student loan debt that's another really big

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Speaker 3: concern because if you remember, you know a lot of

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Speaker 3: the student loan payments have been basically deferred for a

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Speaker 3: while because of COVID. Now that it opened back up,

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Speaker 3: we saw serious delinquencies jump from basically under one percent

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Speaker 3: last year to over fourteen percent. So these are something

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Speaker 3: that we This is an area one I'll watch really

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Speaker 3: close to because that's a stressor that some people are seeing.

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Speaker 3: So now government reopening and that's going to be definitely

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Speaker 3: something that can help us move forward.

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Speaker 6: And it seems that the consumer has noticed too, because

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Speaker 6: the University of Michigan had their Consumer Sentiment Index come

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Speaker 6: out and that dropped to a little over fifty in November,

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Speaker 6: and that's the weakest level we've seen in a couple

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Speaker 6: of years. So it would seem that this isn't happening.

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Speaker 6: You know, behind the scenes, people are well aware of it,

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Speaker 6: and their concerns were shared about not only their own

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Speaker 6: personal finances but business conditions in general. And actually most

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Speaker 6: households expect unemployment to go up over the next year,

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Speaker 6: so they're not seeing happy things on the horizon. Do

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Speaker 6: you agree with with what the herd is saying there

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Speaker 6: or do you think there's a different outcome.

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Speaker 3: No, I absolutely agree with what they're feeling when they

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Speaker 3: were asked. And you got to remember, whenever someone has

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Speaker 3: asked something about how they feel, kind depends on what's

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Speaker 3: going on in the environment, and that environment has been

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Speaker 3: overshadowed by the government shutdown.

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Speaker 5: That's definitely affected.

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Speaker 3: So what's going to be really interesting to see what

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Speaker 3: sort of rebound we may see in the next Consumer

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Speaker 3: Center report when we get that with the government reopening

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Speaker 3: and hopefully stay saying open been for a while. But yeah,

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Speaker 3: when you look at some of that data, Brian, essentially,

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Speaker 3: the data we've gotten last week, it's been you know,

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Speaker 3: a little bit kind of a little bit hairy.

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Speaker 5: I mean, we saw the that's the layoff notice.

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Speaker 3: It's reported by Challenger, the Challenger layoff notices that jumped

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Speaker 3: to one hundred and fifty three thousand. That was the

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Speaker 3: highest October announcements in terms of layoffs in more than

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Speaker 3: twenty years. So you know that that was a big number. Now,

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Speaker 3: not all the data that we've gotten, excuse me, from

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Speaker 3: private companies has been bad. You know, last week we

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Speaker 3: got ADP Data, which is a big payroll company, and

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Speaker 3: they showed that total private payrolls increased by forty two thousand.

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Speaker 3: So that was pretty good, especially considering that we've had

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Speaker 3: two months of decline. But when you look under the

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Speaker 3: hood a little bit, what we see is that large

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Speaker 3: companies were really the reason for this. Large companies essentially

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Speaker 3: added seventy four thousand and in large companies basically five

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Speaker 3: hundred plus employees, but companies under that actually cut thirty

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Speaker 3: two thousand jobs last month, So when you look at that,

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Speaker 3: it's not as pretty as it looks a little bit

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Speaker 3: of a mixed picture when it comes to labor reports

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Speaker 3: that we've been getting last week, But overall, it is

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Speaker 3: something that I would call definitely some cracks are forming,

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Speaker 3: and we need to see how those cracks are continued

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Speaker 3: to progress as we get more and more data, because

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Speaker 3: that's going.

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Speaker 5: To have a big impact on what the FED does.

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Speaker 4: Andy, I want to get your take on maybe what's

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Speaker 4: going on here with that latest ADP report. It seems

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Speaker 4: a bit counterintuitive to me when everyone's talking about the

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Speaker 4: potential of AI really disrupting the labor market causing jobs

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Speaker 4: to go away for a lot of people. I would

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Speaker 4: have expected these huge, large companies that are already implementing

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Speaker 4: a bunch of AI technology to be the ones laying

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Speaker 4: off people, when you know, at least for the October report,

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Speaker 4: it's the businesses with fewer than five hundred employees that

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Speaker 4: cut the jobs.

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Speaker 2: What are what do you see as.

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Speaker 4: The reasons behind smaller employers cutting while larger employers actually

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Speaker 4: adding jobs.

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Speaker 3: Yeah, well, that's a very interesting take, and I think

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Speaker 3: what you really also need to look at is you

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Speaker 3: need to look at the sector levels within those ADB reports.

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Speaker 3: So one thing you can look at is that a

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Speaker 3: lot of the gains were concentrated in what i'll called

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Speaker 3: trade and utility companies.

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Speaker 5: I was about forty seven thousand of that.

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Speaker 3: Financial service companies added another eleven thousand, and education healthcare

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Speaker 3: was also a big benefit benefactor, I guess I should

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Speaker 3: say or whatever, adding twenty five thousand.

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Speaker 5: Now we saw declines in some of these.

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Speaker 3: Other areas like it, which actually to your point regarding AI,

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Speaker 3: they dropped the total number of jobs by seventeen thousand.

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Speaker 3: So at the sector level, AI is having impact, especially

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Speaker 3: on those information companies. But to your point, also larger

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Speaker 3: companies are taking advantage of AI and they're probably a

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Speaker 3: little bit more able to essentially implement a lot of

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Speaker 3: these AI projects that would you know, allow them to

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Speaker 3: reduce their workforce. But what a lot of them are

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Speaker 3: doing it's more of a they're not hiring and they're

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Speaker 3: just not firing either. It's like a no hiring, no

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Speaker 3: firing for these larger companies on the whole. So they're

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Speaker 3: looking to use AI to get more out of their

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Speaker 3: current workers, but still not higher additional companies now are

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Speaker 3: additional employees now. The other thing I want to mention,

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Speaker 3: just really quickly on the jobs front, the Chicago Fed

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Speaker 3: release their.

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Speaker 5: Unemployment rate proxy.

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Speaker 3: It's kind of nice because it gives you a good

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Speaker 3: idea of what's going on without actually getting.

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Speaker 5: The data from the government.

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Speaker 3: And what they showed is that the unemployment rate likely

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Speaker 3: moved up just a hair from four point three to

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Speaker 3: four point four percent, so still pretty low from an

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Speaker 3: overall perspective.

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Speaker 6: Any and maybe you address this, and I hope it

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Speaker 6: didn't miss it, apologies if I did. But do the

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Speaker 6: numbers whether we're talking about Challenger or assume not ADP

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Speaker 6: because ADP doesn't do the federal payroll. But do those

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Speaker 6: include the federal furloughs we've been talking about the last

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Speaker 6: couple of months, or are we setting that aside?

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Speaker 3: Well on the Challenger stuff, it certainly does not, because

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Speaker 3: it's really just about whether or not companies are announcing,

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Speaker 3: and so it's going to be your private companies and

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Speaker 3: ADP the furloughed workers, those are all going to be national.

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Speaker 3: So when we talked about that forty two thousand new

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Speaker 3: jobs in seventy four thousand other or yeah, coming from

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Speaker 3: the larger companies.

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Speaker 5: You know, those are not going to impact for load workers.

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Speaker 3: However, what it does impact is the essentially the companies

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Speaker 3: that were impacted in like local company, local economy areas

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Speaker 3: by the furlough furlowing.

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Speaker 6: The federal government's doing less, so the companies that support

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Speaker 6: them are in turn doing less. So it's not a

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Speaker 6: direct account of people who have been furloughed, except for

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Speaker 6: businesses who serve those people have laid off their ow employees.

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Speaker 5: You said that much better than I was about to,

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Speaker 5: So thank you.

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Speaker 2: I do what I can.

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Speaker 4: All Right, guys, we're gonna have to leave it there

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Speaker 4: for tonight. Thank you for joining us. As always.

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Speaker 2: Andy.

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Speaker 4: Coming up next, a giant in the retirement plan world

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Speaker 4: is shaking things up. Well you what that could mean

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Speaker 4: for your four one K, your asset allocation, and your

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Speaker 4: long term income plan. You're listening to Simply Money, presented

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Speaker 4: by all Worth Financial on fifty five KRC.

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Speaker 2: The talk station.

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Speaker 1: Story coming out of City Hall today.

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Speaker 2: Us when you need it.

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Speaker 1: He said that what I was hearing locally, nationally, everywhere

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Speaker 1: in between fifty five krc D talkstation.

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Speaker 7: All Worth Financial a registered investment advisory firm. Any ideas

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Speaker 7: presented during this program are not intended to provide specific

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Speaker 7: financial advice. You should consult your own financial advisor, tax consultant,

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Speaker 7: or estate planning attorney to conduct your own due diligence.

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Speaker 4: our daily podcast. You can listen the following morning during

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Speaker 4: in your during your evening walk around the neighborhood. Think

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Speaker 4: about how fun that might be. And if you think

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Speaker 4: the iHeart app or wherever you find your podcast. If

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Speaker 4: you've built a couple million dollar portfolio, balance in retirement accounts,

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Speaker 4: and if you have a paid off home and are

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Speaker 4: sitting on cash wondering what to do next, You're not alone.

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Speaker 4: We're going to answer questions about all of that and

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Speaker 4: more straight ahead of six forty three be honest. How

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Speaker 4: often do you check your portfolio balance? A new study

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Speaker 4: done by a research firm called dy Neta found that

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Speaker 4: almost half of all investors are checking their investments performance

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Speaker 4: once a day or more.

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Speaker 6: Brian, I'll admit it. I do this way more often

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Speaker 6: than I should. I'm human too. It's fun, right. I

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Speaker 6: know it's going to panic. When it's negative, I just

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Speaker 6: quit looking at it. But when it's when things are

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Speaker 6: going up and the net worth is reaching heights it

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Speaker 6: hasn't before, I know full well, I'm going to give

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Speaker 6: a chunk back.

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Speaker 2: That's how life works. And I checked the.

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Speaker 4: I check the balance of my doge coins about every

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Speaker 4: fifteen to seventeen minutes.

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Speaker 2: It's a it's a wonderful dopamine rush.

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Speaker 6: You own no doge coins, don't, don't.

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Speaker 2: I know you better than that.

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Speaker 6: You wouldn't know where to buy doge coins. I'm teaching,

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Speaker 6: But yeah, no, I do it too, you know, And

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Speaker 6: this survey tells us, you know what, why are people

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Speaker 6: doing this?

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Speaker 2: Well? I can tell you exactly why I do it well.

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Speaker 6: When markets are volatile, people look more often because we're

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Speaker 6: thinking about it, right that it's in the headlines, it's

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Speaker 6: in my face. In between my meetings, I catch a

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Speaker 6: headline on my phone and maybe something good is happening,

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Speaker 6: maybe something bad's happening. Well, I can't resist. I got

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Speaker 6: to go see what's happening in my own portfolio. Gives

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Speaker 6: us the illusion of control, right, we believe that. You know,

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Speaker 6: sometimes we think if we're always looking at it, we're

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Speaker 6: going to be able to react quickly or prevent losses,

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Speaker 6: or maybe jump into something before it makes the big run.

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Speaker 2: This is why there's a whole.

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Speaker 6: Part of the academic world called behavioral economics, and they,

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Speaker 6: the economists there, call this the control fallacy. Staring at

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Speaker 6: it doesn't improve outcomes. It just amplifies stress. Right, If

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Speaker 6: we watch that pot of water boil, it is not

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Speaker 6: going to make it boil any faster. Matter of fact,

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Speaker 6: our brains are going to think that it's not boiling

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Speaker 6: fast enough.

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Speaker 2: Well, but we can, again, we can feel like we're

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Speaker 2: at least controlling its watching it. We all know that's

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Speaker 2: not the case, but it's just how our brains get wired.

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Speaker 2: And I think that leads to this next point. We

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Speaker 2: let's face it, we all live in a what we'd

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Speaker 2: like to call a refresh economy. Right now. What does

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Speaker 2: that mean?

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Speaker 4: Well, people check their likes on social media, they check emails,

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Speaker 4: they check news in real time, and let's face it,

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Speaker 4: investor behavior has followed suit.

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Speaker 2: We're all used.

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Speaker 4: To staring at these apps and just constantly looking at screens,

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Speaker 4: and it tends to move over to the investment world too.

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Speaker 2: It's just natural behavior. We just like to see things

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Speaker 2: moving around. We like to see colors change, we like

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Speaker 2: to see like we like to see news updates.

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Speaker 4: And people know that's the case. We've talked about that

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Speaker 4: humptying different times. That's how the whole media and social

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Speaker 4: media business platform has been built to glue us to

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Speaker 4: that screen and keep us looking at everything all the time.

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Speaker 4: We just got to be mufthful of that because sometimes

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Speaker 4: if you look at your investment, you know, balance, too

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Speaker 4: often you're going to be driven to make a decision,

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Speaker 4: right because you know, it goes back to that control thing.

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Speaker 4: I see it moving around, I must do something, and

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Speaker 4: usually nine times out of ten, that's something that we

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Speaker 4: do ends up not being a good decision.

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Speaker 6: Yeah, and I've been fascinated by this, you know, I've

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Speaker 6: been doing this for thirty years and the things that

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Speaker 6: get people's attention, including myself. I'm human too, and I

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Speaker 6: have the same goal as my clients do. I want

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Speaker 6: to retire someday and get the kids through college and

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Speaker 6: all that other stuff. But that's been fascinating to me

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Speaker 6: to understand why that occurs. And at the end of

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Speaker 6: the day, Bob, we are all between our ears. We

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Speaker 6: have lunch meat and chemicals. One of our favorite chemicals

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Speaker 6: in there is dopamine, and we get dopamine no matter what.

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Speaker 6: It gives us that little emotional hit, even positive or

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Speaker 6: negative news, just something, some kind of new stimulus gives

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Speaker 6: us a little shout of dopamine, and it turns out

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Speaker 6: that's what we're after. That's why we pick up our

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Speaker 6: phones a thousand times a day, just to see whatever

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Speaker 6: baloney headlines or whatever meaningless notifications are there for me

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Speaker 6: to react to. And then there's I can't really remember

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Speaker 6: the last time I picked up my phone, looked at

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Speaker 6: it and realized, yes, there, I should do something about

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Speaker 6: this news headline. This should cause me to act in

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Speaker 6: some way. No, it's just me getting my little dopamine

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Speaker 6: hit and then going back to work or whatever I

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Speaker 6: was doing before until I get the urge to do

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Speaker 6: it again. So I've been really trying to be more

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Speaker 6: mindful of that. How how rarely it actually means anything.

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Speaker 6: So anyway, So that's the dopamine side of things. There's

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Speaker 6: also fear of missing out or what I like to

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Speaker 6: call fomo. When news breaks about, hey, the market's hitting

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Speaker 6: a record high, AI stocks are swaring well, well, that

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Speaker 6: causes us to feel like we're gonna miss something. I

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Speaker 6: better be watching, or I'm going to miss out on

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Speaker 6: an opportunity to be a to be a bazillionaire tomorrow. Really, really,

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Speaker 6: this is super common among younger investors and people who

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Speaker 6: started investing really just in the past three years, which

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Speaker 6: have been really really positive ever since twenty twenty two,

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Speaker 6: and so looking every day has been a rewarding experience.

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Speaker 6: If you just started looking, just started investing in the

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Speaker 6: last three years, you start studying your market history because

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Speaker 6: it's not always going to be this way. You will

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Speaker 6: there will be a time where there's twelve eighteen months

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Speaker 6: you just do only want to look at your four

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Speaker 6: one k. It's just too darn depressing. However, that's part

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Speaker 6: of the game. You have got to get used to that.

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Speaker 6: If you have young people in your lives who have

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Speaker 6: just started their four one ks, just started investing. Teach

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Speaker 6: them market history, show them what twenty twenty two looked

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Speaker 6: like two thousand and eight oh two. These are things

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Speaker 6: that will happen, are virtually guaranteed to occur again. We

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Speaker 6: have to be able to anticipate them and make sure

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Speaker 6: we can ride them out. Otherwise we start making bad

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Speaker 6: decisions like trying to time the market, which usually means

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Speaker 6: getting out at the bottom, or trying to make it

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Speaker 6: up with super speculative assets, which can exacerbate things. And

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Speaker 6: all of that robs you of years of building wealth

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Speaker 6: for sure.

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Speaker 4: And I think another another reason people just get addicted

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Speaker 4: to checking all this stuff. You know you talked about

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Speaker 4: fear of missing out. There's another thing out there, and

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Speaker 4: it's just straight, you know, fear in general, past market trauma.

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Speaker 4: People who live through the dot com bust, the Great

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Speaker 4: Financial Crisis or COVID remember how fast things can change.

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Speaker 4: And let's face it, in today's political divide, where I mean,

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Speaker 4: depending on where you get your news sources, and I'm

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Speaker 4: talking to people on both sides of the aisle here,

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Speaker 4: you know, for you know, an app like X for example,

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Speaker 4: Brian I'd say sixty to seventy percent of the stuff

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Speaker 4: that flies around on there, it's unverified. You don't know

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Speaker 4: whether that's real news, fake news, or anything in between,

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Speaker 4: or just straight out lies and propaganda.

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Speaker 2: But if we get that fear thing, we're.

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Speaker 4: Just waiting for the next shoe to drop, the next

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Speaker 4: thing to implode our portfolios. And a lot of people

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Speaker 4: are walking around with that all day every day. When

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Speaker 4: that causes people to check their portfolios more than they

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Speaker 4: should and again make decisions that they.

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Speaker 6: Probably shouldn't make and sorry, and then life changes too, Right,

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Speaker 6: So big life events retirement, job change, marriage, divorce, inheritance,

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Speaker 6: new baby in the house, new grand baby around, that's

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Speaker 6: a great time to kind of look at things as

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Speaker 6: a trigger. So the investments might still be fine, but

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00:21:21,560 --> 00:21:24,280
Speaker 6: something changed in the outside of your big picture shifted

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Speaker 6: a little bit, so maybe your mix needs adjusting. But

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Speaker 6: if those big things aren't happening, let your portfolio alone.

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Speaker 6: If it was fine before, it's still fine, just look

440
00:21:31,880 --> 00:21:34,560
Speaker 6: at it when there's new information to react to. Also,

441
00:21:34,680 --> 00:21:36,919
Speaker 6: of course, in this I think goes without saying, when

442
00:21:36,920 --> 00:21:39,760
Speaker 6: you're near a milestone, if you're sneaking up on retirement,

443
00:21:40,119 --> 00:21:42,520
Speaker 6: or you've got a big purchase to make, maybe paying

444
00:21:42,560 --> 00:21:45,000
Speaker 6: off college something like that. That's a time to review

445
00:21:45,359 --> 00:21:47,439
Speaker 6: where's the risk in my portfolio. So I've got this

446
00:21:47,520 --> 00:21:50,160
Speaker 6: big expense coming up, Am I using dollars that could

447
00:21:50,200 --> 00:21:52,159
Speaker 6: go over the cliff tomorrow just before I have to

448
00:21:52,160 --> 00:21:54,520
Speaker 6: pay the bill? If that's the case, then I might

449
00:21:54,600 --> 00:21:56,320
Speaker 6: be making mistakes. So maybe I need to take some

450
00:21:56,440 --> 00:21:59,439
Speaker 6: risk off the table rather than waiting until it's literally

451
00:21:59,480 --> 00:22:01,679
Speaker 6: time to write the check to whomever is going to

452
00:22:01,680 --> 00:22:03,600
Speaker 6: take that money from you. So the closer I am

453
00:22:03,640 --> 00:22:05,800
Speaker 6: to using that money, the more important it is to

454
00:22:05,840 --> 00:22:08,840
Speaker 6: shift from growth to preservation. Take the gains while they're there.

455
00:22:08,960 --> 00:22:11,320
Speaker 6: And we've talked about this ad nauseum all year long.

456
00:22:11,359 --> 00:22:13,360
Speaker 6: I think, Bob, this has been a great run, great

457
00:22:13,400 --> 00:22:15,040
Speaker 6: couple of years. If you've got an upcoming bill in

458
00:22:15,080 --> 00:22:17,000
Speaker 6: the next couple months, maybe even the next year, you

459
00:22:17,080 --> 00:22:19,439
Speaker 6: might take those dollars off the table. So it's not

460
00:22:19,520 --> 00:22:23,160
Speaker 6: hard to write that check. Should the market take a dip, Yeah, I.

461
00:22:23,080 --> 00:22:25,440
Speaker 4: Mean you've been getting into reasons why you should check

462
00:22:25,520 --> 00:22:28,719
Speaker 4: your portfolio and responsibly review your strategy.

463
00:22:29,280 --> 00:22:30,600
Speaker 2: And I'll say this.

464
00:22:30,520 --> 00:22:34,520
Speaker 4: Gets into whether you're a self directed investor or whether

465
00:22:34,560 --> 00:22:36,639
Speaker 4: you work with a good fiduciary advisor.

466
00:22:37,359 --> 00:22:39,800
Speaker 2: Here's the all Worth advice. If you've got a good.

467
00:22:39,640 --> 00:22:43,920
Speaker 4: Financial plan the portfolio, remember that it's just the engine.

468
00:22:44,080 --> 00:22:46,520
Speaker 4: You don't need to look under the hood every day

469
00:22:46,760 --> 00:22:50,160
Speaker 4: to know that the engine is running. Coming up next,

470
00:22:50,280 --> 00:22:53,679
Speaker 4: how old is your Internet router? That's a question you

471
00:22:53,680 --> 00:22:57,600
Speaker 4: should probably answer very soon, and we'll explain why you're

472
00:22:57,640 --> 00:23:00,639
Speaker 4: listening to Simply Money, presented by Allworth Financial on fifty

473
00:23:00,640 --> 00:23:02,680
Speaker 4: five KRC the talk station.

474
00:23:04,080 --> 00:23:05,200
Speaker 2: Something is happening.

475
00:23:05,400 --> 00:23:08,199
Speaker 1: It's time to end the failed experiment of open borders.

476
00:23:08,480 --> 00:23:09,920
Speaker 7: Your countries are going to hell.

477
00:23:10,320 --> 00:23:13,399
Speaker 2: Something in our country, Charlie Kirk, I forgive.

478
00:23:13,080 --> 00:23:15,440
Speaker 6: Them Antifa across this country would be.

479
00:23:15,359 --> 00:23:18,120
Speaker 8: Trump assess and Ryan Ruth guilty on all five charges.

480
00:23:18,240 --> 00:23:21,959
Speaker 4: Something in our world, Jato countries should shoot down Russian

481
00:23:22,080 --> 00:23:24,000
Speaker 4: ear crash shank you in all day they.

482
00:23:24,000 --> 00:23:24,600
Speaker 7: Enter their ear.

483
00:23:24,640 --> 00:23:26,440
Speaker 2: See it's always something.

484
00:23:26,359 --> 00:23:26,800
Speaker 9: Yes, I do.

485
00:23:27,080 --> 00:23:31,720
Speaker 1: It's a very important moment. Fifty five KRC the talk station,

486
00:23:32,200 --> 00:23:33,000
Speaker 1: and I'm Marto.

487
00:23:32,800 --> 00:23:35,439
Speaker 7: Lopez here and right now iHeartRadio station.

488
00:23:39,840 --> 00:23:42,240
Speaker 2: You're listening to Simply Money paused by all Worth Financial.

489
00:23:42,240 --> 00:23:45,320
Speaker 4: I'm Bob Sponseller along with Brian James, joined tonight by

490
00:23:45,400 --> 00:23:49,280
Speaker 4: our real estate expert Michelle Sloan. Michelle, thank you, as

491
00:23:49,359 --> 00:23:52,040
Speaker 4: always for spending time with us tonight. We're gonna call

492
00:23:52,080 --> 00:23:54,520
Speaker 4: this segment fixer upper regret.

493
00:23:55,200 --> 00:23:56,760
Speaker 2: Give us some advice.

494
00:23:56,400 --> 00:23:59,520
Speaker 4: On what not to do in terms of piling money

495
00:23:59,600 --> 00:24:03,160
Speaker 4: into a house that we potentially might want to sell someday.

496
00:24:03,720 --> 00:24:06,639
Speaker 4: And you know, how much is too much and what

497
00:24:06,880 --> 00:24:10,040
Speaker 4: area is the wrong area to quote unquote invest in

498
00:24:10,200 --> 00:24:13,120
Speaker 4: when putting money into a home that we might want

499
00:24:13,160 --> 00:24:15,600
Speaker 4: to reap that investment back later.

500
00:24:16,680 --> 00:24:18,800
Speaker 8: Well, that is a loaded question.

501
00:24:18,920 --> 00:24:19,320
Speaker 2: I don't know.

502
00:24:19,359 --> 00:24:21,760
Speaker 8: I think there is a movie out there called The

503
00:24:21,880 --> 00:24:25,680
Speaker 8: Money Pit. Yeah, and sometimes.

504
00:24:25,040 --> 00:24:26,480
Speaker 2: I've lived in one of those before.

505
00:24:26,640 --> 00:24:30,480
Speaker 8: You have to be really, really careful because you have

506
00:24:30,560 --> 00:24:34,399
Speaker 8: to know what you're doing. You can't just go into

507
00:24:34,440 --> 00:24:38,159
Speaker 8: this real estate thing blindly. And do you are you

508
00:24:38,200 --> 00:24:41,840
Speaker 8: planning to buy a fixer upper to live in? Are

509
00:24:41,880 --> 00:24:45,040
Speaker 8: you planning to buy it as an investment? Do you

510
00:24:45,200 --> 00:24:49,000
Speaker 8: have the wherewithal and the knowledge even to get into

511
00:24:49,040 --> 00:24:52,320
Speaker 8: something like this because it is definitely not for the

512
00:24:52,359 --> 00:24:54,680
Speaker 8: week or someone who doesn't.

513
00:24:54,280 --> 00:24:55,760
Speaker 2: Have deep pockets.

514
00:24:56,040 --> 00:24:59,399
Speaker 8: So I've seen quite a few properties over the years

515
00:24:59,440 --> 00:25:02,400
Speaker 8: I've been in business in real estate, selling real estate

516
00:25:02,400 --> 00:25:04,600
Speaker 8: for twenty years, so I've seen some people that have

517
00:25:04,680 --> 00:25:11,080
Speaker 8: gotten themselves in over their head. And if that's the case, again,

518
00:25:11,320 --> 00:25:14,080
Speaker 8: you just have to know when to say when. But

519
00:25:14,480 --> 00:25:18,000
Speaker 8: you really need to set a realistic budget. And if

520
00:25:18,000 --> 00:25:21,720
Speaker 8: you're buying a home as a fixer upper knowing that

521
00:25:21,840 --> 00:25:25,200
Speaker 8: it's going to need work, do not Here's my number

522
00:25:25,240 --> 00:25:30,960
Speaker 8: one tip. Do not skip the inspection because that's going

523
00:25:31,040 --> 00:25:34,040
Speaker 8: to tell you if it's more cosmetic items that need

524
00:25:34,080 --> 00:25:37,240
Speaker 8: to be updated, or if it's something that's going to

525
00:25:37,320 --> 00:25:40,120
Speaker 8: cost a lot more money and it's not as sexy,

526
00:25:40,200 --> 00:25:43,719
Speaker 8: if the wiring needs to be changed, Sure, you know

527
00:25:43,840 --> 00:25:44,640
Speaker 8: something like that.

528
00:25:45,840 --> 00:25:48,040
Speaker 6: But do people have that option nowadays? I mean, with

529
00:25:48,080 --> 00:25:50,240
Speaker 6: houses going as fast as they have and I realize

530
00:25:50,280 --> 00:25:53,400
Speaker 6: things are slowing, but is something that is a true

531
00:25:53,440 --> 00:25:55,159
Speaker 6: fixer upper? Does that hang out on the market a

532
00:25:55,160 --> 00:25:58,280
Speaker 6: little longer because it spooks enough buyers away. Because I

533
00:25:58,320 --> 00:26:00,560
Speaker 6: feel like a lot of other most of my clients

534
00:26:00,600 --> 00:26:02,040
Speaker 6: are telling me I don't have the too, I can't

535
00:26:02,040 --> 00:26:04,280
Speaker 6: do an inspection because somebody's gonna throw cash at this

536
00:26:04,359 --> 00:26:06,359
Speaker 6: and not want an inspection. So if I really want it,

537
00:26:06,400 --> 00:26:07,000
Speaker 6: I got to forego.

538
00:26:07,119 --> 00:26:08,280
Speaker 2: That is that an option.

539
00:26:08,680 --> 00:26:12,280
Speaker 8: The market is changing, and you can get an inspection out.

540
00:26:12,280 --> 00:26:15,320
Speaker 8: And here's the thing, it doesn't matter what's happening in

541
00:26:15,359 --> 00:26:18,680
Speaker 8: the market financially. You have to be smart. You guys

542
00:26:18,680 --> 00:26:22,359
Speaker 8: say this all the time, you know, just because you

543
00:26:22,440 --> 00:26:26,280
Speaker 8: get emotionally attached to a property. And I've showed so

544
00:26:26,400 --> 00:26:29,240
Speaker 8: many properties to buyers where they're like, oh my gosh,

545
00:26:29,320 --> 00:26:32,359
Speaker 8: look at this view. And then I say, but look

546
00:26:32,440 --> 00:26:35,439
Speaker 8: at the foundation. It's crumbling and this house is going

547
00:26:35,520 --> 00:26:39,520
Speaker 8: to fall off the side of the world any minute.

548
00:26:39,560 --> 00:26:39,840
Speaker 4: Now.

549
00:26:40,440 --> 00:26:43,560
Speaker 8: It doesn't matter how much it costs to buy it.

550
00:26:44,560 --> 00:26:46,760
Speaker 8: But again, you have to know what is it going

551
00:26:46,840 --> 00:26:49,359
Speaker 8: to cost to fix it up and make it safe

552
00:26:49,359 --> 00:26:52,040
Speaker 8: and make it stable. And again, if you don't know

553
00:26:52,080 --> 00:26:54,920
Speaker 8: what you're doing, and a lot of times it is

554
00:26:55,119 --> 00:26:58,960
Speaker 8: really important to have someone with some experience as far

555
00:26:59,000 --> 00:27:01,119
Speaker 8: as your realtor who's going to tell you the truth

556
00:27:01,200 --> 00:27:03,600
Speaker 8: whether you want to hear it or not. I remember

557
00:27:03,640 --> 00:27:07,240
Speaker 8: that specific buyer. It was a house in Mount Adams.

558
00:27:07,680 --> 00:27:11,159
Speaker 8: It was looking over it at the city. It was gorgeous,

559
00:27:11,359 --> 00:27:14,879
Speaker 8: but the place was crumbling and it was about to

560
00:27:14,960 --> 00:27:17,920
Speaker 8: fall off the side of Mount Adams. And so I said,

561
00:27:18,000 --> 00:27:20,880
Speaker 8: you know what, you don't have the funds because when

562
00:27:20,920 --> 00:27:24,600
Speaker 8: you're setting a budget, you've got the purchase price. But

563
00:27:24,720 --> 00:27:28,760
Speaker 8: then most people underestimate the cost that it is to

564
00:27:28,840 --> 00:27:33,440
Speaker 8: actually fix it up. You can't just foundation issues. You're

565
00:27:33,440 --> 00:27:38,000
Speaker 8: not You're not just putting you know, filler in some cracks.

566
00:27:38,600 --> 00:27:39,240
Speaker 2: So you have.

567
00:27:41,160 --> 00:27:42,640
Speaker 6: No no, no, it's.

568
00:27:42,480 --> 00:27:47,400
Speaker 8: It can be very very costly if you jump into

569
00:27:47,400 --> 00:27:50,159
Speaker 8: something and only look at it with your heart and

570
00:27:50,280 --> 00:27:51,000
Speaker 8: not your mind.

571
00:27:51,840 --> 00:27:54,960
Speaker 2: Hey, Michelle, speaking of investing with your heart not your mind.

572
00:27:55,080 --> 00:27:57,680
Speaker 4: You know, take me through if this has ever happened,

573
00:27:57,800 --> 00:27:59,359
Speaker 4: you know, with with your customers.

574
00:27:59,400 --> 00:28:01,639
Speaker 2: I mean, people go in with the best of intentions.

575
00:28:01,640 --> 00:28:03,600
Speaker 4: They buy a house and they think they're going to

576
00:28:03,640 --> 00:28:06,320
Speaker 4: live there forever, and they want it to be perfect,

577
00:28:06,359 --> 00:28:07,920
Speaker 4: so they just start fixing it up.

578
00:28:08,080 --> 00:28:10,400
Speaker 2: They want it to be, you know, perfect for them,

579
00:28:11,080 --> 00:28:11,600
Speaker 2: And I.

580
00:28:11,920 --> 00:28:14,840
Speaker 4: Think sometimes people will invest money in the house to

581
00:28:14,880 --> 00:28:17,679
Speaker 4: the point where now they have the most expensive house

582
00:28:17,800 --> 00:28:21,200
Speaker 4: on the street, or you know, the most expensive three

583
00:28:21,240 --> 00:28:24,280
Speaker 4: bedroom compared to other three bedroom houses in the street

584
00:28:24,359 --> 00:28:27,280
Speaker 4: or the subdivision. Don't you have to kind of, you know,

585
00:28:27,359 --> 00:28:29,640
Speaker 4: in spite of your heart and how nice you want

586
00:28:29,640 --> 00:28:33,320
Speaker 4: things to be, don't you always have to kind of gauge,

587
00:28:33,400 --> 00:28:35,480
Speaker 4: you know, how much do we have into this house

588
00:28:35,880 --> 00:28:39,040
Speaker 4: versus what it could potentially sell for. Because people think

589
00:28:39,120 --> 00:28:42,160
Speaker 4: they might live in this place forever and then somebody's

590
00:28:42,240 --> 00:28:44,800
Speaker 4: job gets transferred or they just have a change of

591
00:28:44,840 --> 00:28:46,200
Speaker 4: heart and mind and want to move.

592
00:28:46,560 --> 00:28:47,120
Speaker 2: I mean, don't.

593
00:28:47,160 --> 00:28:49,360
Speaker 4: Don't you have to kind of you know, price this

594
00:28:49,480 --> 00:28:52,240
Speaker 4: stuff out on what the market will bear, so to speak.

595
00:28:52,960 --> 00:28:57,840
Speaker 8: Absolutely, you really need to avoid over improving a home.

596
00:28:58,320 --> 00:29:01,720
Speaker 8: So for example, if you're gonnall a one hundred thousand

597
00:29:01,720 --> 00:29:05,440
Speaker 8: dollars new kitchen in a three hundred thousand dollars home,

598
00:29:06,360 --> 00:29:10,120
Speaker 8: your balance is off and you're not going to get

599
00:29:10,160 --> 00:29:13,480
Speaker 8: that money back, no matter how nice it is, You're

600
00:29:13,480 --> 00:29:15,960
Speaker 8: not going to get your money back if you decide

601
00:29:15,960 --> 00:29:19,000
Speaker 8: that you need to sell now. If money is no object,

602
00:29:19,520 --> 00:29:22,400
Speaker 8: have at it. But again, like I said, if it's

603
00:29:23,000 --> 00:29:27,960
Speaker 8: if it is a moderate cost based on the neighborhood

604
00:29:28,360 --> 00:29:31,800
Speaker 8: and the other homes around you, then that's a good

605
00:29:31,880 --> 00:29:34,960
Speaker 8: it's a good investment. If you are going just hog

606
00:29:35,040 --> 00:29:38,840
Speaker 8: wild because you won the lottery, okay, that's fine. You're

607
00:29:38,840 --> 00:29:42,080
Speaker 8: going to spend through all that lottery money and you're

608
00:29:42,080 --> 00:29:44,320
Speaker 8: gonna at some point need to sell that house. And

609
00:29:44,360 --> 00:29:47,440
Speaker 8: you've over improved it so much that there's no way

610
00:29:47,520 --> 00:29:49,680
Speaker 8: an appraisal is going to be able to come in

611
00:29:50,280 --> 00:29:53,760
Speaker 8: on and get you that money back. So you really

612
00:29:53,840 --> 00:29:59,160
Speaker 8: have to be prepared and ask all of the right questions. No,

613
00:29:59,640 --> 00:30:03,040
Speaker 8: have a have someone to talk to. Have your real

614
00:30:03,120 --> 00:30:07,280
Speaker 8: estate agent or a friend or a financial advisor talk

615
00:30:07,360 --> 00:30:12,880
Speaker 8: to them about the smart ways to invest in a property.

616
00:30:13,280 --> 00:30:16,040
Speaker 8: Maybe it's a fixer upper, maybe it's your own home.

617
00:30:16,520 --> 00:30:19,040
Speaker 8: You know, Scott and I have We have fixed up

618
00:30:19,720 --> 00:30:22,640
Speaker 8: every home that we've ever lived in, and we've done

619
00:30:22,680 --> 00:30:25,000
Speaker 8: a lot of the work ourselves, so we've saved quite

620
00:30:25,040 --> 00:30:27,680
Speaker 8: a bit of money. But it's interesting because when you

621
00:30:27,720 --> 00:30:31,480
Speaker 8: go to fix up the floor in the kitchen, then

622
00:30:31,520 --> 00:30:33,720
Speaker 8: it doesn't match the floor in the living room or

623
00:30:33,760 --> 00:30:35,840
Speaker 8: the family room, so then you got to do that,

624
00:30:36,240 --> 00:30:38,120
Speaker 8: and then you're going into a bathroom. I mean, it

625
00:30:38,200 --> 00:30:41,160
Speaker 8: just seems like it's snowballs. So one thing will lead

626
00:30:41,200 --> 00:30:45,400
Speaker 8: to another and lead to another, and before you know it,

627
00:30:45,680 --> 00:30:48,320
Speaker 8: you are spending a lot of money and a lot

628
00:30:48,360 --> 00:30:49,880
Speaker 8: of time and a lot of disruption.

629
00:30:50,040 --> 00:30:52,200
Speaker 6: So you have to think about all of those things.

630
00:30:52,680 --> 00:30:54,520
Speaker 6: So let me ask a question from the other point

631
00:30:54,520 --> 00:30:56,400
Speaker 6: of view. Does this mean that I can go get,

632
00:30:56,720 --> 00:31:00,640
Speaker 6: you know, sixteenth of an inch thick cheap crappl from

633
00:31:00,680 --> 00:31:02,520
Speaker 6: the clearance thing and throw that down so that it

634
00:31:02,560 --> 00:31:05,040
Speaker 6: looks pretty for I mean that I'm being a little

635
00:31:05,040 --> 00:31:07,400
Speaker 6: facetious here, but obviously there's a good thing to do

636
00:31:07,440 --> 00:31:09,400
Speaker 6: and a bad thing to do. So what's the minimum

637
00:31:09,480 --> 00:31:10,440
Speaker 6: you should do if you need to.

638
00:31:10,520 --> 00:31:12,920
Speaker 8: Sure, I mean, if you want to, if you want

639
00:31:12,920 --> 00:31:16,120
Speaker 8: to do quality that's going to last, especially if you're

640
00:31:16,160 --> 00:31:17,560
Speaker 8: going to be living in the home.

641
00:31:17,920 --> 00:31:18,040
Speaker 3: Now.

642
00:31:18,080 --> 00:31:21,000
Speaker 8: I've seen a lot of people that are flippers and

643
00:31:21,040 --> 00:31:26,240
Speaker 8: they've put the lower grade items, the lower grade flooring

644
00:31:26,320 --> 00:31:30,280
Speaker 8: in the homes. It looks good, but the quality's not there.

645
00:31:30,360 --> 00:31:35,040
Speaker 8: So it really depends on asking yourself, what is your why?

646
00:31:35,240 --> 00:31:38,920
Speaker 8: Are you renovating for yourself, your comfort and your longevity?

647
00:31:39,240 --> 00:31:41,640
Speaker 8: Are you renovating so that you could flip it, turn

648
00:31:41,680 --> 00:31:45,240
Speaker 8: it around and sell it? And those are completely different things.

649
00:31:45,360 --> 00:31:47,800
Speaker 8: You got to ask all of the questions before you

650
00:31:47,880 --> 00:31:48,480
Speaker 8: get started.

651
00:31:48,960 --> 00:31:51,560
Speaker 2: Great advice, Michelle, Like a lot of things in life,

652
00:31:51,760 --> 00:31:54,640
Speaker 2: know your why. I love that advice you're listening to.

653
00:31:54,680 --> 00:31:57,080
Speaker 4: Simply Money, presented by all Worth Financial Law on fifty

654
00:31:57,080 --> 00:31:59,520
Speaker 4: five KRC the talk station.

655
00:32:01,680 --> 00:32:02,400
Speaker 1: Mark Levin.

656
00:32:02,600 --> 00:32:04,760
Speaker 10: Probably the people who should be listening aren't, But there

657
00:32:04,800 --> 00:32:06,920
Speaker 10: are a lot of people who tune in by accident.

658
00:32:06,960 --> 00:32:09,680
Speaker 2: Then they start listening. I get this wherever I go listen.

659
00:32:09,760 --> 00:32:11,800
Speaker 2: I listened for a week. I listen to I said,

660
00:32:12,040 --> 00:32:14,080
Speaker 2: I like this guy. Click what he has to say.

661
00:32:14,160 --> 00:32:17,320
Speaker 1: Mark Levin Tonight at ten oh six on fifty five

662
00:32:17,440 --> 00:32:20,200
Speaker 1: krs the talkstation, Welcome to here.

663
00:32:20,360 --> 00:32:22,480
Speaker 2: I do think he is too old to run.

664
00:32:22,640 --> 00:32:23,680
Speaker 7: In twenty twenty.

665
00:32:23,400 --> 00:32:26,880
Speaker 2: Four, fifty five krs the talkstation.

666
00:32:30,520 --> 00:32:33,240
Speaker 4: You're listening to simply money because I buy all Worth Financial.

667
00:32:33,280 --> 00:32:36,400
Speaker 4: I'm Bob sponseller along a flying up n Give a

668
00:32:36,400 --> 00:32:39,000
Speaker 4: financial question you'd like for us to answer. There is

669
00:32:39,040 --> 00:32:41,160
Speaker 4: a red button you can click while you're listening to

670
00:32:41,200 --> 00:32:44,120
Speaker 4: the show, right on the iHeart app. Simply record your

671
00:32:44,200 --> 00:32:47,800
Speaker 4: question and it will come straight to us. Dave and

672
00:32:47,880 --> 00:32:50,000
Speaker 4: Mary live in Mainville and Brian.

673
00:32:50,120 --> 00:32:50,760
Speaker 2: They're wondering.

674
00:32:50,800 --> 00:32:53,960
Speaker 4: They say, Hey, we're in our early sixties and considering

675
00:32:54,080 --> 00:32:58,000
Speaker 4: partial retirement. How do you plan cash flow when income

676
00:32:58,080 --> 00:33:01,880
Speaker 4: becomes unpredictable? Yes, question, This is a great question. This

677
00:33:01,960 --> 00:33:04,120
Speaker 4: is kind of the key of financial planning.

678
00:33:04,160 --> 00:33:07,560
Speaker 6: We become so accustomed, Bob to living off of o

679
00:33:07,720 --> 00:33:10,760
Speaker 6: PM other people's money. Somebody has to give me some

680
00:33:10,880 --> 00:33:13,240
Speaker 6: kind of check or something so that I can pay

681
00:33:13,240 --> 00:33:15,000
Speaker 6: my bills. That's in the first for the first forty

682
00:33:15,040 --> 00:33:17,080
Speaker 6: fifty years of our lives, that's a job, and then

683
00:33:17,120 --> 00:33:19,840
Speaker 6: for the remainder it becomes social security or whatever pensions

684
00:33:19,840 --> 00:33:21,920
Speaker 6: we've built up. What we tend to do, though, is

685
00:33:22,000 --> 00:33:23,840
Speaker 6: ignore the fact that if we've done the right things,

686
00:33:23,840 --> 00:33:27,200
Speaker 6: then there's also a significant nest egg out there that

687
00:33:27,240 --> 00:33:30,800
Speaker 6: can support those bills, and that itself becomes you know,

688
00:33:31,080 --> 00:33:33,719
Speaker 6: that becomes your own money, of course, and so so

689
00:33:33,760 --> 00:33:36,320
Speaker 6: how to plan around this, Well, A lot of people

690
00:33:36,320 --> 00:33:38,240
Speaker 6: want to focus on the I need it to spit

691
00:33:38,320 --> 00:33:41,040
Speaker 6: out a predictable stream of income. So maybe I'm gonna

692
00:33:41,040 --> 00:33:43,080
Speaker 6: do CDs or bonds or just something where I know

693
00:33:43,120 --> 00:33:45,600
Speaker 6: what's coming and when. And that's fine, except the what

694
00:33:45,680 --> 00:33:48,560
Speaker 6: happens there is we often rob the ability for growth

695
00:33:48,600 --> 00:33:51,560
Speaker 6: from that portfolio. So look, I would say, you know

696
00:33:51,960 --> 00:33:54,600
Speaker 6: you're gonna you're gonna definitely want to keep something related

697
00:33:54,640 --> 00:33:57,120
Speaker 6: to growth, which growth can be unpredictable. Something needs to

698
00:33:57,120 --> 00:33:59,120
Speaker 6: be growing, even for the littlest old widow out there,

699
00:33:59,120 --> 00:34:01,320
Speaker 6: we still need some growth keep up with inflation. So

700
00:34:01,480 --> 00:34:04,720
Speaker 6: just understand market history and understand model out what it

701
00:34:04,720 --> 00:34:06,960
Speaker 6: would look like if you invested in a certain portfolio

702
00:34:07,000 --> 00:34:08,719
Speaker 6: and pulled a couple thousand dollars out of it every

703
00:34:08,719 --> 00:34:11,720
Speaker 6: month to bridge the gap between your your your social scurity,

704
00:34:11,719 --> 00:34:13,839
Speaker 6: pension checks and what your actual bills are, and then

705
00:34:13,920 --> 00:34:15,880
Speaker 6: understand what it does when the market goes up and

706
00:34:15,920 --> 00:34:18,480
Speaker 6: most importantly, when the market goes down. So it doesn't

707
00:34:18,480 --> 00:34:20,880
Speaker 6: have to be predictable. It's not as predictable as a

708
00:34:20,920 --> 00:34:22,640
Speaker 6: you know, as like a pension or a job. But

709
00:34:22,680 --> 00:34:24,799
Speaker 6: at the same time, that doesn't mean that that is

710
00:34:24,800 --> 00:34:26,319
Speaker 6: a bad thing. You just have to be used to

711
00:34:26,440 --> 00:34:28,800
Speaker 6: you know what what that could look like. So stress

712
00:34:28,840 --> 00:34:32,600
Speaker 6: test and understand it. Moving to Brian and levinon Brian's

713
00:34:32,600 --> 00:34:35,080
Speaker 6: got about two million dollars in retirement accounts and he

714
00:34:35,120 --> 00:34:38,120
Speaker 6: says their portfolio is mostly index based, but he's curious

715
00:34:38,120 --> 00:34:41,520
Speaker 6: if they're missing out on some more tactical active management opportunities.

716
00:34:41,520 --> 00:34:43,600
Speaker 6: Bob's gonna have a field day with this. Is there

717
00:34:43,640 --> 00:34:46,320
Speaker 6: a case Bob for active management at this level?

718
00:34:47,600 --> 00:34:50,680
Speaker 4: Well, Brian, there can be, and I'll say there can be.

719
00:34:50,880 --> 00:34:53,759
Speaker 4: So you know, when when you talk about index portfolio.

720
00:34:54,480 --> 00:34:56,480
Speaker 4: And this is why we like a term we use

721
00:34:56,520 --> 00:35:01,279
Speaker 4: around here is core satellite portfolios, meaning the vast majority

722
00:35:01,640 --> 00:35:04,680
Speaker 4: of the assets in any what i'll say moderate to

723
00:35:04,719 --> 00:35:08,480
Speaker 4: growth based portfolio are mimicking the large you know s

724
00:35:08,560 --> 00:35:11,879
Speaker 4: and P five hundred Nasdaq type of indices. And we've

725
00:35:11,880 --> 00:35:16,200
Speaker 4: talked on this show multiple times that active money management,

726
00:35:16,360 --> 00:35:20,760
Speaker 4: you know, netta fees typically underperforms a good index index

727
00:35:20,800 --> 00:35:23,839
Speaker 4: based you know fund like what you own, so you're

728
00:35:23,840 --> 00:35:28,200
Speaker 4: not doing anything wrong for sure. There are opportunities, however,

729
00:35:28,280 --> 00:35:31,719
Speaker 4: for active management in other asset classes, and you got

730
00:35:31,760 --> 00:35:33,920
Speaker 4: to look around and look at some of those you

731
00:35:33,960 --> 00:35:38,040
Speaker 4: know typical or certain parts of the bond portfolio. You

732
00:35:38,080 --> 00:35:40,920
Speaker 4: can make a case for active management there things like

733
00:35:41,000 --> 00:35:45,160
Speaker 4: small cap stocks, emerging market stocks there are, and then

734
00:35:45,239 --> 00:35:49,279
Speaker 4: some having some non correlated asset classes in your portfolio

735
00:35:49,320 --> 00:35:51,680
Speaker 4: that can increase return and lower risk.

736
00:35:51,800 --> 00:35:52,600
Speaker 2: That's a reason to.

737
00:35:52,560 --> 00:35:57,239
Speaker 4: Have some active man Apart from active you know management

738
00:35:57,280 --> 00:35:59,640
Speaker 4: and returns, there's a bit there can be a big

739
00:35:59,719 --> 00:36:03,399
Speaker 4: case for using some active management from a tech standpoint.

740
00:36:03,719 --> 00:36:05,520
Speaker 4: I know you talked about all your money is in

741
00:36:05,560 --> 00:36:08,799
Speaker 4: retirement accounts. We're now talking about non retirement accounts for

742
00:36:09,280 --> 00:36:14,080
Speaker 4: where having a good tax managed strategy running in the background,

743
00:36:14,120 --> 00:36:17,600
Speaker 4: harvesting short term losses, using those to offset gains.

744
00:36:18,480 --> 00:36:19,800
Speaker 2: Those are often at.

745
00:36:19,680 --> 00:36:23,440
Speaker 4: A ton of value to a portfolio. So there's reasons

746
00:36:23,440 --> 00:36:26,000
Speaker 4: to have some of this stuff in there. It's on

747
00:36:26,040 --> 00:36:28,960
Speaker 4: a case by case basis, but it's a great question. Brian,

748
00:36:29,640 --> 00:36:32,120
Speaker 4: all Right, Ron and Mason. We've got a says we've

749
00:36:32,120 --> 00:36:35,000
Speaker 4: got a paid off house, but a lot of equity

750
00:36:35,120 --> 00:36:38,440
Speaker 4: sitting idle. What's the smartest way to use that equity?

751
00:36:38,600 --> 00:36:42,160
Speaker 4: Invest downsize or just leave it alone.

752
00:36:42,520 --> 00:36:43,359
Speaker 2: Yeah, this is that way.

753
00:36:43,480 --> 00:36:45,680
Speaker 6: We'll get this question quite as often anymore. I got

754
00:36:45,719 --> 00:36:48,080
Speaker 6: it a lot when when mortgage rates were in the

755
00:36:48,200 --> 00:36:50,920
Speaker 6: you know, the three percent range, sometimes even two percent,

756
00:36:51,239 --> 00:36:53,040
Speaker 6: because people are simply looking at this is the hundreds

757
00:36:53,080 --> 00:36:55,040
Speaker 6: of thousands, if not millions of dollars that I've got

758
00:36:55,040 --> 00:36:57,480
Speaker 6: sitting here in an asset that's not spitting out any income.

759
00:36:57,480 --> 00:36:58,160
Speaker 2: How can I take.

760
00:36:58,080 --> 00:37:00,640
Speaker 6: Advantage of that? Well, really, the only way to advantage

761
00:37:00,920 --> 00:37:04,400
Speaker 6: of it is to is to somehow you know, borrow

762
00:37:04,440 --> 00:37:06,400
Speaker 6: against it to pull the money out, unless you're going

763
00:37:06,440 --> 00:37:08,239
Speaker 6: to airbnb one of your rooms in your house and

764
00:37:08,280 --> 00:37:11,160
Speaker 6: have awkward meetings in the hallway with strangers. There's not

765
00:37:11,280 --> 00:37:13,960
Speaker 6: really a good efficient way to get money out right now.

766
00:37:14,000 --> 00:37:15,520
Speaker 6: If you're going to borrow against your home, you're going

767
00:37:15,560 --> 00:37:17,800
Speaker 6: to be paying about six percent in a home equity line.

768
00:37:17,880 --> 00:37:19,040
Speaker 6: I don't think that that that's.

769
00:37:18,920 --> 00:37:19,359
Speaker 2: The worst thing.

770
00:37:19,400 --> 00:37:21,000
Speaker 6: If you actually have a need, that that can be

771
00:37:21,040 --> 00:37:24,120
Speaker 6: a pretty good way to finance a significant uh, you know,

772
00:37:24,360 --> 00:37:26,719
Speaker 6: an expense you have. Maybe it's a better deal than

773
00:37:26,760 --> 00:37:28,439
Speaker 6: you can get from the car dealer or buy a car,

774
00:37:28,680 --> 00:37:30,799
Speaker 6: or maybe you need you know you're gonna use it

775
00:37:30,840 --> 00:37:32,560
Speaker 6: for college expenses, something like that.

776
00:37:32,840 --> 00:37:33,799
Speaker 2: But simply to.

777
00:37:33,760 --> 00:37:37,719
Speaker 6: Pull money out and and use it to make an

778
00:37:37,719 --> 00:37:39,200
Speaker 6: investment that you hope is going to earn more than

779
00:37:39,239 --> 00:37:41,000
Speaker 6: six percent, I don't think that's worth it right now.

780
00:37:41,120 --> 00:37:43,160
Speaker 6: So I would focus on am I happy in my home?

781
00:37:43,520 --> 00:37:45,520
Speaker 6: Is this the place that I want to be? If not,

782
00:37:45,800 --> 00:37:48,520
Speaker 6: then let's think about some kind of different arrangement. But otherwise,

783
00:37:48,520 --> 00:37:49,640
Speaker 6: don't treat it as a piggybank.

784
00:37:50,719 --> 00:37:51,080
Speaker 2: All right.

785
00:37:51,080 --> 00:37:53,840
Speaker 4: If you're paying seven hundred dollars or more for a

786
00:37:53,880 --> 00:37:57,560
Speaker 4: premium credit card, rising fees might force you to choose

787
00:37:57,640 --> 00:38:01,319
Speaker 4: which one of those cards is actually worth keeping. Will

788
00:38:01,360 --> 00:38:04,239
Speaker 4: help you evaluate your options. Next, you're listening to Simply Money,

789
00:38:04,280 --> 00:38:07,680
Speaker 4: presented by all Worth Financial on fifty five KRC the

790
00:38:07,719 --> 00:38:10,960
Speaker 4: talk station, Mark Levin.

791
00:38:10,760 --> 00:38:14,759
Speaker 10: We Americans, we patriots are irrational people. Irreasonable people, the

792
00:38:14,800 --> 00:38:17,160
Speaker 10: people who know good from either right from wrong. We

793
00:38:17,239 --> 00:38:20,640
Speaker 10: also know hustlers and Marxists and fascists in Islamis who

794
00:38:20,760 --> 00:38:23,960
Speaker 10: endanger our country every damn day. We're destroying our culture

795
00:38:24,080 --> 00:38:27,280
Speaker 10: into civil society, who are breeding a youth that hates

796
00:38:27,320 --> 00:38:29,279
Speaker 10: America and embraces the wrong thing.

797
00:38:29,560 --> 00:38:33,280
Speaker 1: Mark Levin tonight at ten oh six on fifty five KRZ,

798
00:38:33,719 --> 00:38:34,920
Speaker 1: the talk station.

799
00:38:35,480 --> 00:38:39,520
Speaker 8: The reliable information and of course not just one sided.

800
00:38:39,320 --> 00:38:40,719
Speaker 2: Views, news that affects you.

801
00:38:40,800 --> 00:38:43,200
Speaker 1: At the top end to bottom of the hour, fifty

802
00:38:43,239 --> 00:38:45,600
Speaker 1: five KRZ the talk station.

803
00:38:50,160 --> 00:38:52,720
Speaker 4: You're listening to Simply Money, presented by all Worth Financial

804
00:38:52,719 --> 00:38:56,960
Speaker 4: on Bob Sponseller along with Brian James. Many people have

805
00:38:57,080 --> 00:39:00,880
Speaker 4: these high end credit cards, riding the perks and weaving

806
00:39:01,000 --> 00:39:04,400
Speaker 4: between the value among the different cards. But now with

807
00:39:04,520 --> 00:39:09,279
Speaker 4: these issuers starting to, you know, increase annual fees, the

808
00:39:09,400 --> 00:39:12,840
Speaker 4: question is shifting from should I get a premium card

809
00:39:13,320 --> 00:39:17,520
Speaker 4: to which premium card I should keep? Brian in all

810
00:39:17,560 --> 00:39:20,960
Speaker 4: honesty for questions like this one, you know I come

811
00:39:21,000 --> 00:39:23,160
Speaker 4: to you for this stuff, because I know you study

812
00:39:23,160 --> 00:39:25,839
Speaker 4: this stuff and know a lot about it. I'm I'm

813
00:39:25,960 --> 00:39:27,680
Speaker 4: very eager to hear what you have to say on

814
00:39:27,680 --> 00:39:29,680
Speaker 4: this topic, and I mean that in all honesty.

815
00:39:29,840 --> 00:39:32,400
Speaker 6: Yeah, my family has gotten a lot out of the

816
00:39:32,440 --> 00:39:34,560
Speaker 6: credit card reward game. We had a credit card over

817
00:39:34,560 --> 00:39:36,839
Speaker 6: twenty years that was paying money into a five twenty

818
00:39:36,920 --> 00:39:38,759
Speaker 6: nine plan and I'm now very happily on the back

819
00:39:38,840 --> 00:39:40,840
Speaker 6: end of that pulling dollars out for tuition. It was

820
00:39:40,880 --> 00:39:42,600
Speaker 6: free money and it was one of the smartest things

821
00:39:42,600 --> 00:39:45,400
Speaker 6: I've ever done. So why are their higher fees in

822
00:39:45,440 --> 00:39:48,200
Speaker 6: these cards? Well, the credit card issuers, Remember these aren't

823
00:39:48,200 --> 00:39:50,200
Speaker 6: the banks. There are two entities behind your credit card.

824
00:39:50,200 --> 00:39:52,640
Speaker 6: It's the credit card issuer, that's Visa MasterCard. They're the

825
00:39:52,680 --> 00:39:55,640
Speaker 6: ones who want the spending because they're taking a haircut

826
00:39:55,640 --> 00:39:57,719
Speaker 6: off of every little transaction. Every time you wipe that

827
00:39:57,719 --> 00:39:59,480
Speaker 6: you swipe that card, they get two or three percent,

828
00:39:59,680 --> 00:40:03,759
Speaker 6: sometimes even four. And they know that typical premium card user,

829
00:40:03,760 --> 00:40:05,440
Speaker 6: if you've already got a fee on your card, then

830
00:40:05,480 --> 00:40:07,319
Speaker 6: that's got it. Then that's a premium card out there.

831
00:40:07,360 --> 00:40:09,120
Speaker 6: They know these people are high spenders. Pay off the

832
00:40:09,160 --> 00:40:11,279
Speaker 6: balance every month. And is a low credit risk. Those

833
00:40:11,320 --> 00:40:14,759
Speaker 6: are the customers the issuers want. The banks behind it

834
00:40:14,800 --> 00:40:16,720
Speaker 6: want somebody who's going to let it go and ignore

835
00:40:16,719 --> 00:40:19,879
Speaker 6: it so they can charge them the ridiculous interest rates

836
00:40:19,880 --> 00:40:22,480
Speaker 6: twenty five twenty eight percent. So what they're hoping is

837
00:40:22,520 --> 00:40:25,680
Speaker 6: that fewer card holders overall, but those stickier relationships and

838
00:40:25,680 --> 00:40:28,640
Speaker 6: more interchange spend focused on that one card that they

839
00:40:28,719 --> 00:40:30,480
Speaker 6: think is the best one to use. That's what I did,

840
00:40:30,680 --> 00:40:32,400
Speaker 6: like I said, for for a long time. So how

841
00:40:32,400 --> 00:40:34,920
Speaker 6: do you think about this, run a break even analysis.

842
00:40:34,920 --> 00:40:36,960
Speaker 6: If you've got two or more of these premium cards,

843
00:40:36,960 --> 00:40:39,440
Speaker 6: make a spreadsheet, figure out your real usage. You know,

844
00:40:39,520 --> 00:40:41,760
Speaker 6: are you really using those lounge visits and the hotel

845
00:40:41,800 --> 00:40:44,400
Speaker 6: airline credits? Are the lounges open? I have one of

846
00:40:44,400 --> 00:40:46,279
Speaker 6: these cards in about half the time there just isn't

847
00:40:46,320 --> 00:40:48,279
Speaker 6: room they'll let you in the time that you've got

848
00:40:48,280 --> 00:40:51,040
Speaker 6: to lay over. Make sure you're actually getting the value

849
00:40:51,080 --> 00:40:53,320
Speaker 6: out of these different perks. Are you using the free

850
00:40:53,320 --> 00:40:54,960
Speaker 6: thing that they give you?

851
00:40:54,880 --> 00:40:55,080
Speaker 3: You know?

852
00:40:55,440 --> 00:40:58,560
Speaker 6: So sometimes both cards will cover lounge access or global

853
00:40:58,680 --> 00:41:01,359
Speaker 6: entry TSA pre check. Got that twice, you really only

854
00:41:01,360 --> 00:41:03,080
Speaker 6: need it once, So one of them is redundant. And

855
00:41:03,120 --> 00:41:05,719
Speaker 6: that has no value for you. But at the same time,

856
00:41:05,760 --> 00:41:07,959
Speaker 6: if you decide you're gonna cancel one of them, first off,

857
00:41:08,080 --> 00:41:11,839
Speaker 6: be super careful. Don't cancel you low your oldest credit card,

858
00:41:11,840 --> 00:41:14,440
Speaker 6: hang onto that one unless it's an enormous fee. You're

859
00:41:14,440 --> 00:41:16,879
Speaker 6: gonna want that twenty twenty five years where because that's

860
00:41:16,920 --> 00:41:18,600
Speaker 6: what's giving you a lot of your credit score. But

861
00:41:18,640 --> 00:41:21,120
Speaker 6: if you are going to cancel one, ask for retention.

862
00:41:21,400 --> 00:41:23,840
Speaker 6: They might throw you a better deal, some kind of

863
00:41:23,880 --> 00:41:26,239
Speaker 6: hidden perk or something that they only hold back when

864
00:41:26,280 --> 00:41:28,920
Speaker 6: somebody wants to or offer out when somebody wants to cancel.

865
00:41:29,600 --> 00:41:31,400
Speaker 6: But again, the whole point of this is just be

866
00:41:31,440 --> 00:41:33,840
Speaker 6: aware what are you using. A lot of cardholders just

867
00:41:33,920 --> 00:41:36,160
Speaker 6: never redeem these credits or they just don't use all

868
00:41:36,160 --> 00:41:38,399
Speaker 6: the benefits. Some of the perks are just too hard

869
00:41:38,440 --> 00:41:40,160
Speaker 6: to use, so they look great in the brochure, but

870
00:41:40,200 --> 00:41:42,319
Speaker 6: you never actually use them. So just understand what it

871
00:41:42,400 --> 00:41:44,000
Speaker 6: offers you and whether you value that.

872
00:41:45,239 --> 00:41:45,920
Speaker 2: Great stuff.

873
00:41:45,960 --> 00:41:48,000
Speaker 4: Brian, And this is why I'm so blessed to have

874
00:41:48,080 --> 00:41:50,399
Speaker 4: you around to give me advice on stuff like this,

875
00:41:50,680 --> 00:41:53,120
Speaker 4: because I honestly I never look at it at all,

876
00:41:53,160 --> 00:41:55,880
Speaker 4: but good stuff, all right, Thanks for listening. You've been

877
00:41:55,920 --> 00:41:58,400
Speaker 4: listening to Simply Money, presented by all Worth Financial on

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Speaker 4: fifty five KRC, the talk station.

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Speaker 9: In order to live your dream doesn't always involve a

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Speaker 9: pay cut invest your time. Sometimes it involves a pay

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00:42:07,080 --> 00:42:09,360
Speaker 9: cut to get moving and then move.

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00:42:09,239 --> 00:42:11,000
Speaker 2: Up and invest in your future.

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Speaker 9: But I would want a path to make more than

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Speaker 9: I made, not less than I made.

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Speaker 2: Dave Ramsey.

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Speaker 9: There's a lot of people need help in this world.

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Speaker 2: I want you to get clear.

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Speaker 9: I want you to spend some time very carefully going

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Speaker 9: through what are your talents, what are your passions or

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Speaker 9: your skills? You know, what is it you value?

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Speaker 1: Weekdays at seven by fifty five KRZ the talk station

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Speaker 1: all Right.

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Speaker 2: Holiday time