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Speaker 1: Do you I do got to put up these Halloween decorations.

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Speaker 2: Will It's time to do it, dude?

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Speaker 3: The rest I do need to know On fifty five KRC,

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Speaker 3: the talk station.

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Speaker 4: Tonight, Crypto crashes, When to check or not check your

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Speaker 4: investment portfolio, and we tackle your tough money questions. You're

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Speaker 4: listening to Simply Money, presented by all Worth Financial on

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Speaker 4: Bob Sponseller along with Brian James Well. Crypto investors got

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Speaker 4: a bit of a wake up call a few days

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Speaker 4: ago and just a few minutes prices plunged across the

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Speaker 4: board and what's being called a flash crash. Hundreds of

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Speaker 4: billions of dollars disappeared almost instantly. Brian, what actually happened here? Well,

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Speaker 4: so what happened here? The catalyst for this flash cash?

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Speaker 5: We see these every now and then, where there's no

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Speaker 5: big headlines, there's no big crazy it's just the market

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Speaker 5: moves in an extreme and unexpected way. This time it

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Speaker 5: was the unexpected announcement of tar Garraffs on China. I

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Speaker 5: don't know about the word unexpected there. I'm not sure

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Speaker 5: that we shouldn't be shocked by this stuff anymore. We

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Speaker 5: don't get a heads up that next week, we're going

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Speaker 5: to talk about it. Then we talk about it. It just

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Speaker 5: kind of drops out of the sky anyway as the

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Speaker 5: whole weekend unfolded. So President Trump and his advisors kind

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Speaker 5: of backed off on that, and that did help markets

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Speaker 5: to stabilize, but not without doing some damage. So the

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Speaker 5: post mortem here, prices fell pretty quick. Bitcoin dropped by

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Speaker 5: about twelve percent from its prior week's peak, did bounce

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Speaker 5: back a little bit. Ethereum slid by even more at

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Speaker 5: that worst point. Those are the two big ones. They

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Speaker 5: held up the best. It got worse from there though,

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Speaker 5: those mean coins and allt coins, those just got destroyed.

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Speaker 5: Dose coin cratered by about fifty percent before stabilizing, and

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Speaker 5: the tokens outside the biggest ones, but they felt even worse.

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Speaker 5: There's a crypto publication now, they're called coin Desk, and

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Speaker 5: they cited basically an average thirty three percent drop across

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Speaker 5: the board for anything not named Bitcoin or Ethereum. Like

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Speaker 5: I said, those are the big dogs, and they held

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Speaker 5: up a little better, but a lot of those little

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Speaker 5: dogs lost eighty.

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Speaker 2: Percent or more.

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Speaker 5: Small handful of in close to one hundred percent of

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Speaker 5: their value in the same very short period. That is

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Speaker 5: how fragile the markets are that are behind these types

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Speaker 5: of assets. There is no earnings report, there is no

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Speaker 5: new product announcement that's gonna come out. These are commodities

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Speaker 5: and they trade as sutch. They are only worth what

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Speaker 5: people think they are.

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Speaker 2: Yeah, a couple points here.

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Speaker 4: I think it's important to drive home, Brian, and feel

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Speaker 4: free to disagree or agree. But I think I think

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Speaker 4: we use the word crypto now, you know, I think

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Speaker 4: it's dangerous to just talk about all that in one basket,

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Speaker 4: because there are huge differences between things like bitcoin and then,

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Speaker 4: as you already pointed out, these dosee coins and and

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Speaker 4: for to a large extent, this stuff is really speculative

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Speaker 4: in nature, and depending on how much understanding or misunderstanding

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Speaker 4: investors out there have about this stuff, they can get

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Speaker 4: involved in things, you know, that that might result in volatility,

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Speaker 4: like we just talked about that they really didn't bargain

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Speaker 4: for and wanted no part of in the first place.

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Speaker 4: The other on the other end end of the spectrum,

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Speaker 4: there's a lot of people that basically daytrade this stuff.

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Speaker 4: You know, a lot of these coins and other cryptocurrencies

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Speaker 4: you know, and those people, you know, are aware and

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Speaker 4: used to and profit from volatility. So I think it's

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Speaker 4: important if you're going to get into this you know,

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Speaker 4: big space called crypto, you get educated on what you're buying,

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Speaker 4: what the potential moves are, and go in with your

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Speaker 4: eyes wide open. And the second point, there's a lot

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Speaker 4: of institutional money now involved in this space. I mean,

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Speaker 4: it's become kind of art, it's become an asset class.

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Speaker 4: That's that a lot of institutional investment money managers use

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Speaker 4: hedge funds, traders you know, and even regular old portfolio managers.

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Speaker 4: They use this as an allocation percentage of a long

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Speaker 4: term buy and hold portfolio. And you know, when you've

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Speaker 4: got institutional money moving in and out of this stuff,

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Speaker 4: there are algorithms that trip you know, when volatility happens

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Speaker 4: and this stuff gets sold whether people want to own

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Speaker 4: it long term or not, and that can add to

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Speaker 4: the volatility as well. So again a couple just points

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Speaker 4: there to keep in mind, be aware of what you're

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Speaker 4: doing in this you know, broad space called crypto, and

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Speaker 4: more importantly why, and go in with your eyes wide open.

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Speaker 5: And just be prepared for what can happen. Is this

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Speaker 5: is obviously a brand new asset. It's not that new,

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Speaker 5: but at the same time, it's not hundreds of years

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Speaker 5: old like the stock market that we can look at

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Speaker 5: through lots of different environments. Just about everything that happens

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Speaker 5: to crypto is going to happen for the first time.

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Speaker 5: Now we're seeing how it behaves in a tariff related environment.

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Speaker 5: So let's talk a little more about that. Why did

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Speaker 5: this happen? So why was crypto impacted by these tariffs

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Speaker 5: on China? Well, it's not separate from traditional markets as

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Speaker 5: much as it used to be. As Bob just shared,

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Speaker 5: it's an integrated part of our financial structure.

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Speaker 6: Nowadays.

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Speaker 5: There's a lot of companies out there that are that

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Speaker 5: are making money off of bitcoin by being directly involved

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Speaker 5: in it. There are companies such as micro Strategy that

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Speaker 5: micro Strategy is.

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Speaker 6: Is an IT company.

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Speaker 5: They focus on business intelligence, software analytics, and so forth.

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Speaker 5: But what they've done is they have basically tied their

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Speaker 5: entire future to crypto by.

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Speaker 6: Simply buying tons of it.

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Speaker 5: They go about forty billion dollars worth of mostly bitcoin,

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Speaker 5: and that's that's just a decision that they've made because

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Speaker 5: that's how they feel like they can increase the value

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Speaker 5: of their company, So a lot of institutional money is

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Speaker 5: in there now. When these tariffs hit, investors typically will say, well,

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Speaker 5: that's that's a tax that's more expensive. So I want

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Speaker 5: to get out of and take some risk off the table,

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Speaker 5: and we're going to sell some of these assets that

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Speaker 5: I feel like a little more volatile, and crypto hits

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Speaker 5: that category perfectly. So if we're going to take risk

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Speaker 5: off the table, it's gonna be it's gonna come out

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Speaker 5: of the most volatile markets.

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Speaker 6: And that's kind of what crypto is here.

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Speaker 5: So as long as so while traders were pulling back

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Speaker 5: from stocks, they also sold off crypto at almost faster rate.

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Speaker 5: Leverage makes it even worse because a lot of times

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Speaker 5: these companies have borrowed money, you know, using other people's

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Speaker 5: money to make more money. That's the American way, that's

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Speaker 5: what leverages. But because so many crypto traders use that

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Speaker 5: borrowed money, even a small dip triggers these automatic sales

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Speaker 5: through you know the algorithm that Bob mentioned and that

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Speaker 5: snowballs quickly and then you get a five crash.

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Speaker 4: Well, you brought up that micro strategy company and I've

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Speaker 4: I have followed that company a little bit and it's been,

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Speaker 4: you know, quite remarkable to see the transformation of that company.

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Speaker 4: I mean, I think their growth as a company was slowing.

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Speaker 4: Their revenues and earnings were dropping. So the way that

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Speaker 4: they tried to you know, build shareholder value is they

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Speaker 4: came out publicly and said we're going to put one

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Speaker 4: hundred percent of our you know, liquid holdings into bitcoin.

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Speaker 4: I mean, so so people that bought this company originally

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Speaker 4: thinking as you said, it was a software company, it's

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Speaker 4: it's now a proxy for bitcoin. So it's a completely

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Speaker 4: different business model than original investors had signed up for.

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Speaker 4: And you just got to be aware if you're going

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Speaker 4: to be involved in this stuff on what these companies

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Speaker 4: are doing. I mean that's an extreme example, but uh,

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Speaker 4: there are others like it that we don't have time

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Speaker 4: to go into today.

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Speaker 6: Yeah, I do, I think on that topic real quick

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Speaker 6: for it.

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Speaker 5: I have I have a client that worked for micro Strategy,

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Speaker 5: and this is about he's not there anymore, but I

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Speaker 5: remember five six years ago he was trying to do

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Speaker 5: his job, which had everything to do with supporting the

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Speaker 5: software products that that company purports to sell, and he

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Speaker 5: kept getting more and more confused about why can't I

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Speaker 5: get the resources and the attention that I need to

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Speaker 5: do my job and serve these customers. And the answer,

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Speaker 5: now we know, was because the company had decided, you

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Speaker 5: know what, we're just gonna use our resources and we're

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Speaker 5: just gonna buy bitcoin and sit on it while still

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Speaker 5: doing this software kind of stuff on the side. So

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Speaker 5: so far that is paid off because bitcoin has moved

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Speaker 5: in the right direction. But there's gonna be some some

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Speaker 5: some funny moves made by that company. If Bitcoin ever

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Speaker 5: takes a really really solid hit, they're gonna have to

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Speaker 5: take measures, just like any other company that's trying to

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Speaker 5: maintain its profit margins.

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Speaker 2: Yeah, it's an asset like at anything else.

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Speaker 4: It's willing, it's it's worth what somebody is willing to

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Speaker 4: pay for it today, good or bad. I think another point,

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Speaker 4: just to you know, to drive home here is again

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Speaker 4: long term. You know, there are reasons that people own bitcoin.

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Speaker 4: They see it as a digital gold and it's and

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Speaker 4: we don't have time to get into all that kind

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Speaker 4: of stuff, but it, you know, it's seen as a

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Speaker 4: there's a limited number of shares that are gonna be

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Speaker 4: issued or units that are gonna be issued, and you know,

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Speaker 4: away from government interference and all that kind of stuff.

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Speaker 4: These doge coins are completely different game. It's just pure speculation.

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Speaker 4: I don't think a lot of our clients are a

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Speaker 4: lot of people that even listen to this show are

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Speaker 4: out there, you know, day trading doge coins. But I

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Speaker 4: think it's just important to point out here that you know,

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Speaker 4: when you think of bitcoin or anything like that as

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Speaker 4: digital gold, most people think of that as a non

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Speaker 4: correlated asset to the stock market, meaning that when the

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Speaker 4: stock market drops, when the economy slows down, these are

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Speaker 4: assets that are gonna be non correlated to the broad

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Speaker 4: stock market and help cushion volatility in your portfolio. And

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Speaker 4: what we saw over the last week is the exact opposite.

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Speaker 4: Not only did it not move, yeah, not only did

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Speaker 4: it not move, you know, contrary to the movement of

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Speaker 4: the stock market, it moved down more than the stock

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Speaker 4: market moved.

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Speaker 5: Down, so it actually to the same stimulus those tariffs.

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Speaker 5: Tariffs are negative news. The stock market took that and

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Speaker 5: it threw a fit on Friday. The crypto markets made

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Speaker 5: it even worse. So you're not protected by from volatility

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Speaker 5: by owning those things. It doesn't mean they're bad investments,

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Speaker 5: but don't take it for anything more than what it is.

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Speaker 2: Here's the all Worth advice.

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Speaker 4: If crypto's in your portfolio, it should play a small,

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Speaker 4: very defined role, not the setting role. Coming up next,

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Speaker 4: how often are you checking your portfolio will reveal what

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Speaker 4: we think the sweet spot might be.

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Speaker 2: Next.

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Speaker 4: You're listening to Simply Money, presented by all With Financial

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Speaker 4: on fifty five KRC the talk station.

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Speaker 1: In order, we're going in Russia and tariffs, and you

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Speaker 1: got a lot of stuff to do.

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Speaker 3: I can't sports stock, so we'll stuff it all into

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Speaker 3: news update check and often this stuff. Fifty five KRZ

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Speaker 3: the talk station.

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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 a state planning attorney to conduct your own due diligence.

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Speaker 4: You're listening to Simply Money presented by all Worth Financial

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Speaker 4: on Bob Sponsoring along with Brian James. If you can't

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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: your friends and family could use some financial advice, tell

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Speaker 4: them about us as well. Just search simply Money on

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

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Speaker 2: If you've built a.

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Speaker 4: Couple million dollar portfolio balance in return hirement accounts, and

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

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

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Speaker 4: We're gonna answer questions about all of that and more

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Speaker 4: straight ahead of six forty three. Be honest, how often

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

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Speaker 4: by a research firm called Di Netta found that almost

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

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Speaker 4: a day or more.

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

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

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Speaker 5: I know it's gonna panic when it's negative, I just

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Speaker 5: quit looking at it. But it's when things are going

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Speaker 5: up and then net worth is reaching heights it hasn't before.

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Speaker 6: I know full well I'm going to give a jump back.

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Speaker 6: That's how life works.

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Speaker 4: And I checked the I checked the balance of my

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Speaker 4: doge coins about every 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. I know you

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Speaker 6: better than that. You wouldn't know where to buy doge coins.

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Speaker 6: I'm teusing, but yeah, no, I do it too, you know,

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

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Speaker 6: people doing this?

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Speaker 5: Well?

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Speaker 6: I can tell you exactly why I do it well.

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Speaker 5: When markets are volatile, people look more often because we're

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Speaker 5: thinking about it, right that it's in the headlines.

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Speaker 6: It's in my face.

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Speaker 5: In between my meetings, I catch a headline on my phone,

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Speaker 5: and you know, maybe something good is happening, maybe something

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Speaker 5: bad's happening. Why I can't resist. I gotta go see

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Speaker 5: what's happening to my own portfolio. Gives us the illusion

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Speaker 5: of control, right, we believe that, you know. Sometimes we

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Speaker 5: think if we're always looking at it, we're going to

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Speaker 5: be able to react quickly or prevent losses, or maybe

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Speaker 5: 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 5: Part of the academic world called behavioral economics, and they

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Speaker 5: the the economists there call this the control fallacy. Staring

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Speaker 5: at it doesn't improve outcomes, It just amplifies stress. Right,

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Speaker 5: if we watch that pot of water boil, it is

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Speaker 5: not going to make it boil any faster. Matter of fact,

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Speaker 5: our brains are gonna think that it's not boiling fast enough.

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Speaker 4: Well, but we can, again, we can feel like we're

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Speaker 4: at least controlling it watching it. We all know that's

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Speaker 4: not the case, but it's how our brains get wired.

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Speaker 4: And I think that leads to this next point. We

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Speaker 4: let's face it, we all live in a what we'd

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Speaker 4: like to call a refresh economy. Right now, what does

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Speaker 4: that mean? Well, people check their likes on social media,

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Speaker 4: they check emails, they check news in real time, and

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Speaker 4: let's face it, investor behavior has followed suit.

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Speaker 6: 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 4: It's just natural behavior. We just like to see things

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Speaker 4: moving around. We like to see colors change, we like

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Speaker 4: to see likes, we like to see news updates. And

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

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Speaker 4: in 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 2: We just got to be mindful.

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Speaker 4: Of that because sometimes if you look at your investment,

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Speaker 4: you know, balance, too often, you're gonna be driven to

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Speaker 4: make a decision right because you know, it goes back

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Speaker 4: to that control thing. I see it moving around, I

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Speaker 4: must do something, and usually nine times out of ten

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Speaker 4: that's something that we do ends up not being a

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Speaker 4: good decision.

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Speaker 5: Yeah, And I've been fascinated by this, you know, I've

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Speaker 5: been doing this for thirty years and the things that

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Speaker 5: get people's attention, including myself. I'm human too, and I

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Speaker 5: have the same goal as my clients do. I want

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Speaker 5: to retire someday and get the kids through college and

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Speaker 5: all that other stuff. But that's been fascinating to me

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Speaker 5: to understand why that occurs. And at the end of

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Speaker 5: the day, Bob, we are all between our ears. We

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Speaker 5: have lunch meat and chemicals. One of our favorite chemicals

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Speaker 5: in there is dopamine, and we get dopamine no matter what,

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Speaker 5: it gives us that little emotional hit, even positive or

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Speaker 5: negative news, just something some kind of new stimulus gives

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Speaker 5: us a little shout of dopamine, and it turns out

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Speaker 5: that's what we're after. That's why we pick up our

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Speaker 5: phones a thousand times a day just to see whatever

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Speaker 5: balogney headlines or whatever meaningless notifications are there for me

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Speaker 5: to react to. And then there's I can't really remember

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Speaker 5: the last time I picked up my phone, looked at

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Speaker 5: it and realized, yes, there, I should do something about

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Speaker 5: this news headline.

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Speaker 6: This should cause me to act in some way. No,

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Speaker 6: it's just me getting my little.

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Speaker 5: Dopamine hit and then going back to work or whatever

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Speaker 5: I was doing before until I get the urge to

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Speaker 5: do it again. So I've been really trying to be

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Speaker 5: more mindful of that. How rarely it actually means anything

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Speaker 5: so anyway, So that's the dopamine side of the thing.

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Speaker 5: There's also fear of missing out or what I like

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Speaker 5: to call fomo when news breaks about, hey, the market's

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Speaker 5: hitting a record high, AI stocks are soaring well, well,

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Speaker 5: that causes us to feel like We're going to miss something.

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Speaker 5: I better be watching, or I'm going to miss out

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Speaker 5: on an opportunity to be to be a bazillionaire tomorrow. Really, really,

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Speaker 5: this is super common among younger investors and people who

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Speaker 5: started investing really just in the past three years, which

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Speaker 5: have been really really positive ever since twenty twenty two,

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Speaker 5: and so looking every day has been a rewarding experience.

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Speaker 5: If you just started looking or just started investing in

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Speaker 5: the last three years, you start studying your market history,

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Speaker 5: because it's not always going to be this way. You

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Speaker 5: will there will be a time where there's twelve eighteen months.

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Speaker 5: You just don't only want to look at your four

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Speaker 5: O one K. It's just too darn depressing. However, that's

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Speaker 5: part of the game. You have got to get used

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Speaker 5: to that. If you have young people in your lives

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Speaker 5: who have just started their foura one case, just started investing,

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Speaker 5: teach them market history, show them what twenty twenty two

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Speaker 5: looked like two thousand and eight oh two. These are

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Speaker 5: things that will happen, are virtually guaranteed to occur again.

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Speaker 5: We have to be able to anticipate them and make

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Speaker 5: sure we can ride them out. Otherwise we start making

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Speaker 5: bad decisions like trying to time the market, which usually

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Speaker 5: means getting out at the bottom, or trying to make

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Speaker 5: it up with super speculative assets, which can exacerbate things,

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Speaker 5: and all of that robs you of years of building

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Speaker 5: wealth for sure.

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Speaker 4: And I think another I think another reason. People just

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Speaker 4: get addicted to checking all this stuff. You know, you

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

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Speaker 4: and it's just straight you know, fear in general, past

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Speaker 4: market trauma. People who live through the dot com bust,

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Speaker 4: the Great Financial Crisis or COVID, remember how fast things

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Speaker 4: can change. And let's face it, in today's political divide

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Speaker 4: where I mean, depending on where you get your news sources.

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Speaker 4: And I'm talking to people on both sides of the

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Speaker 4: aisle here, you know, for you know, an app like

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Speaker 4: X for example, Brian, I'd say sixty to seventy percent

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Speaker 4: of the stuff that flies around on there, it's unverified.

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Speaker 2: You don't know whether that's real.

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Speaker 4: News, fake news, or anything in between, or just straight

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Speaker 4: out lies and propaganda. But if we get that fear thing,

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Speaker 4: we're just waiting for the next shoe to drop, the

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

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Speaker 4: people are walking around with that all day, every day,

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

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Speaker 4: they should and again make decisions that they probably shouldn't make.

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Speaker 5: That's right, and then life changes too, right, So big

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Speaker 5: life events retirement, job change, marriage, divorce, inheritance, new baby

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Speaker 5: in the house, new grand baby around. That's a great

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Speaker 5: time to kind of look at things as a trigger.

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Speaker 5: So the investments might still be fine, but something change

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Speaker 5: in the outside of your big picture shifted a little bit,

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Speaker 5: so maybe your mix needs adjusting. But if those big

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Speaker 5: things aren't happening, lets your portfolio alone. If it was

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Speaker 5: fine before, it's still fine. Just look at it when

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Speaker 5: there's new information to react to. Also, of course, in

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Speaker 5: this I think goes without saying, but when you're near

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Speaker 5: a milestone, if you're sneaking up on retirement, or you've

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Speaker 5: got a big purchase to make, maybe paying off college

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Speaker 5: something like that, that's a time to review where's the

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Speaker 5: risk in my portfolio. So I've got this big expense

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Speaker 5: coming up. Am I using dollars that could go over

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Speaker 5: the cliff tomorrow just before I have to pay the bill?

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Speaker 5: If that's the case, then I might be making mistakes.

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Speaker 5: So maybe I need to take some risk off the

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Speaker 5: table rather than waiting until it's literally time to write

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Speaker 5: the check to whomever is going to take that money

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Speaker 5: from you. So the closer I am to using that money,

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Speaker 5: the more important it is to shift from growth to preservation.

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Speaker 5: Take the gains while they're there. And we've talked about

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Speaker 5: this ad nauseum all year long. I think, Bob, this

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Speaker 5: has been a great run, great couple of years. If

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Speaker 5: you've got an upcoming bill the next couple months, maybe

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Speaker 5: even the next year, you might take those dollars off

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Speaker 5: the table. So it's not hard to write that check.

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Speaker 5: Should the market take a dip, yeah, I.

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Speaker 4: Mean you've been getting into reasons why you should check

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Speaker 4: your portfolio and responsibly review your strategy. And I'll say

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Speaker 4: this gets into whether you're a self directed investor or

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Speaker 4: whether you work with a good fiduciary advisor. If you

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Speaker 4: are a self directed investor and you're making all the decisions,

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Speaker 4: the buyers, the sells, the reallocation, yeah, you need to

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Speaker 4: be looking at things more often. But if you work

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Speaker 4: with an advisor, a good advisor, usually Brian, a semiannual,

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Speaker 4: yearly or yearly review with your advisor is a pretty

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Speaker 4: good cadence because if there's communication going on and you're

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Speaker 4: letting your advisor know about some of these major life

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Speaker 4: milestones that you just talked about, well, then your advisor

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Speaker 4: can help you shift and get out in front of

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Speaker 4: some of this stuff and keep money out of harm's

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Speaker 4: way that needs to be out of the market. So

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Speaker 4: you know, it's a good time to just think about

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Speaker 4: where are you as an investor. Are you calling all

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Speaker 4: the shots yourself or do you trust and have a

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Speaker 4: good relationship with a FIDU sharey advisor? And depending on

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Speaker 4: what situation you're in, that really changes the calculus here

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Speaker 4: on how often you should be staring at this stuff

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Speaker 4: and potentially making moves in your portfolio.

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Speaker 2: Here's the all Worth advice.

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Speaker 4: If you've got a good financial plan the portfolio, remember

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Speaker 4: that it's just the engine. You don't need to look

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Speaker 4: under the hood every day to know that the engine

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Speaker 4: is running. Coming up next, how old is your Internet router?

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Speaker 4: That's a question you should probably answer very soon, and

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Speaker 4: we'll explain why you're listening to Simply Money, presented by

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Speaker 4: all Worth Financial on fifty five KRC, the talk station.

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Speaker 3: His day, what's the event of the day, what's going on?

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Speaker 3: Will be busy?

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Speaker 4: Frankie news, The President just said, good morning, what.

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Speaker 3: Will yours look like?

437
00:20:48,040 --> 00:20:49,320
Speaker 2: Hey, new day is coming.

438
00:20:49,520 --> 00:20:53,000
Speaker 8: Check in Brian Thomas tomorrow morning at five on fifty

439
00:20:53,080 --> 00:20:53,840
Speaker 8: five KRC.

440
00:20:54,200 --> 00:20:57,960
Speaker 9: The talk station you're seeing an iHeartRadio station.

441
00:21:04,720 --> 00:21:07,360
Speaker 4: You're listening to Simply Money, presented by all Worth Financial.

442
00:21:07,359 --> 00:21:10,960
Speaker 4: I'm Bob sponsorer along with Brian James, joined tonight by

443
00:21:11,000 --> 00:21:15,679
Speaker 4: our tech and cyber security guru, mister Dave Hatter, and

444
00:21:15,800 --> 00:21:18,920
Speaker 4: I know this topic is something everyone out there.

445
00:21:19,000 --> 00:21:20,680
Speaker 2: This applies to everyone.

446
00:21:20,920 --> 00:21:23,040
Speaker 4: Dave, what are we going to cover tonight to help

447
00:21:23,119 --> 00:21:25,600
Speaker 4: keep our data and our money secure?

448
00:21:26,000 --> 00:21:28,320
Speaker 1: Guys is always thanks for having me on, and this

449
00:21:28,359 --> 00:21:31,080
Speaker 1: is an important topic. It's a recent warning from the

450
00:21:31,160 --> 00:21:35,960
Speaker 1: FBI about small businesses and people's homes. You know, generally,

451
00:21:36,040 --> 00:21:38,800
Speaker 1: large corporations have nerds like me running around. They have

452
00:21:38,960 --> 00:21:43,359
Speaker 1: enterprise grade security solutions, they have firewalls from folks like

453
00:21:43,440 --> 00:21:46,680
Speaker 1: Palo Alto and Cisco and Fortinet. But at home, many

454
00:21:46,720 --> 00:21:49,600
Speaker 1: people just have whatever came from the internet service provider.

455
00:21:49,880 --> 00:21:52,439
Speaker 1: Same with small businesses, or maybe they've gone out the

456
00:21:52,480 --> 00:21:55,159
Speaker 1: best buyer Walmart or somewhere and bought an off the

457
00:21:55,200 --> 00:21:58,399
Speaker 1: shelf Wi Fi router because they need more capabilities than

458
00:21:58,440 --> 00:21:59,959
Speaker 1: what you can get out of the thing that we

459
00:22:00,119 --> 00:22:03,399
Speaker 1: delivered by your internet service provider. And the FBI is

460
00:22:03,440 --> 00:22:05,960
Speaker 1: warning that in many cases, like so much of the

461
00:22:06,000 --> 00:22:08,720
Speaker 1: tech that's out there, so much of our so called

462
00:22:09,119 --> 00:22:12,760
Speaker 1: Internet of things aka smart devices. You know, these things

463
00:22:12,800 --> 00:22:15,480
Speaker 1: have to be updated regularly, they have to be configured correctly,

464
00:22:15,520 --> 00:22:17,640
Speaker 1: and as they get older and go into life where

465
00:22:17,680 --> 00:22:22,199
Speaker 1: they're not getting software upgrades and more importantly, security patches

466
00:22:22,200 --> 00:22:25,879
Speaker 1: from the vendor, that creates a gigantic security hole. This

467
00:22:25,960 --> 00:22:27,800
Speaker 1: is the kind of thing TENFOI hat nuts like me

468
00:22:27,880 --> 00:22:29,880
Speaker 1: warn't about all the time. But I'm happy to see

469
00:22:29,880 --> 00:22:32,400
Speaker 1: that the FBI is now trying to get in front

470
00:22:32,440 --> 00:22:34,360
Speaker 1: of this and warning folks that if you have these

471
00:22:34,400 --> 00:22:37,600
Speaker 1: older end of life devices, you know, anything that's more

472
00:22:37,640 --> 00:22:39,520
Speaker 1: than five or six years old, you should question if

473
00:22:39,520 --> 00:22:41,280
Speaker 1: it's ten years old or older, that's going to be

474
00:22:41,320 --> 00:22:44,399
Speaker 1: a significant concern you. You need to seriously take a

475
00:22:44,440 --> 00:22:46,560
Speaker 1: hard look at replacing these things. And the good news

476
00:22:46,600 --> 00:22:47,960
Speaker 1: is they're relatively inexpensive.

477
00:22:48,600 --> 00:22:51,280
Speaker 4: All Right, Dave is somebody who grew up here in Cincinnati,

478
00:22:51,359 --> 00:22:54,120
Speaker 4: you know, using that old Green Hills mindset where I'm

479
00:22:54,119 --> 00:22:57,280
Speaker 4: going to pinch every penny I can. You know, a

480
00:22:57,320 --> 00:22:59,399
Speaker 4: lot of times I think to myself, and I know

481
00:22:59,520 --> 00:23:01,520
Speaker 4: other people will think the same way. I do not

482
00:23:01,640 --> 00:23:05,240
Speaker 4: want to rent that router from Spectrum or you know,

483
00:23:05,320 --> 00:23:07,280
Speaker 4: Aulti Fiber or whatever. I'm just going to go buy

484
00:23:07,280 --> 00:23:09,520
Speaker 4: my own because it's going to save me a few bucks.

485
00:23:09,960 --> 00:23:12,600
Speaker 4: Are those the people you're really talking to right now,

486
00:23:12,680 --> 00:23:15,399
Speaker 4: Those people that went out and bought that router twenty

487
00:23:15,480 --> 00:23:18,119
Speaker 4: years ago and said, yep, I got my own router.

488
00:23:18,240 --> 00:23:20,880
Speaker 4: I feel great about not having to pay rental payments

489
00:23:20,920 --> 00:23:24,280
Speaker 4: to a cable company. Are those the people most at risk,

490
00:23:24,480 --> 00:23:26,600
Speaker 4: you know, in situations like the one you're talking about

491
00:23:26,640 --> 00:23:27,040
Speaker 4: right now.

492
00:23:28,040 --> 00:23:31,280
Speaker 1: Most likely because if you're essentially renting it from your

493
00:23:31,280 --> 00:23:35,200
Speaker 1: internet service provider again think you know, Spectrum, Ultifiber, whomever.

494
00:23:35,359 --> 00:23:37,119
Speaker 1: And i'd also point out, you know, there are so

495
00:23:37,240 --> 00:23:39,320
Speaker 1: many different ways to get online now. You know, in

496
00:23:39,359 --> 00:23:41,840
Speaker 1: the old days you typically have to work with some

497
00:23:41,880 --> 00:23:44,520
Speaker 1: sort of landline based internet service provider. Now you have

498
00:23:44,600 --> 00:23:47,600
Speaker 1: solutions like Starlink out there and so forth. But at

499
00:23:47,600 --> 00:23:49,800
Speaker 1: the end of the day, the Wi Fi router. And

500
00:23:50,000 --> 00:23:52,119
Speaker 1: this often gets confusing for people because a lot of

501
00:23:52,160 --> 00:23:55,439
Speaker 1: folks have two different devices. You have the cable modem,

502
00:23:55,600 --> 00:23:58,680
Speaker 1: if you have something like Spectrum, which is a physical

503
00:23:58,720 --> 00:24:03,040
Speaker 1: device that connects you to their network, and then sometimes

504
00:24:03,080 --> 00:24:05,479
Speaker 1: that will serve also as a Wi Fi router. Sometimes

505
00:24:05,560 --> 00:24:08,720
Speaker 1: you might have a separate device that is then throwing

506
00:24:08,800 --> 00:24:12,680
Speaker 1: up the Wi Fi signal in your facility, your home,

507
00:24:12,720 --> 00:24:15,320
Speaker 1: your small office or whatever. This is a constant battle

508
00:24:15,359 --> 00:24:18,479
Speaker 1: with my family, Like the Wi Fi's down, I'm like no,

509
00:24:18,520 --> 00:24:21,000
Speaker 1: the WiFi is not down. The internet connection is down.

510
00:24:21,040 --> 00:24:23,840
Speaker 1: These are two different things right now. Again, sometimes one

511
00:24:23,880 --> 00:24:28,000
Speaker 1: device can provide both. Most people have too. If you're

512
00:24:28,040 --> 00:24:30,560
Speaker 1: working with the internet service provider, you know they will

513
00:24:30,560 --> 00:24:33,359
Speaker 1: occasionally replace these things. Usually you're not going to have

514
00:24:33,359 --> 00:24:35,040
Speaker 1: a device that's little. But if you went out and

515
00:24:35,040 --> 00:24:36,359
Speaker 1: bought your own because you don't want to have that

516
00:24:36,400 --> 00:24:40,399
Speaker 1: rental fee or you wanted extra capabilities, yes, again, if

517
00:24:40,400 --> 00:24:42,159
Speaker 1: it's more than five or six years old, and the

518
00:24:42,200 --> 00:24:46,600
Speaker 1: FBI specifically says in their PSA anything produced in twenty

519
00:24:46,640 --> 00:24:49,040
Speaker 1: ten or earlier, so you're talking to fifteen year old device.

520
00:24:49,720 --> 00:24:53,360
Speaker 1: These things have notorious security flaws. They're not getting updates

521
00:24:53,359 --> 00:24:56,280
Speaker 1: from the vendors. They're also missing a lot of more

522
00:24:56,320 --> 00:24:59,200
Speaker 1: modern security features, and that's one of the key things here.

523
00:24:59,440 --> 00:25:02,960
Speaker 1: You can go out and buy a high, relatively high end,

524
00:25:03,119 --> 00:25:06,680
Speaker 1: powerful Wi Fi router for three hundred bucks or less

525
00:25:06,800 --> 00:25:10,280
Speaker 1: that will add an enormous amount of additional functionality and

526
00:25:10,359 --> 00:25:13,400
Speaker 1: security capabilities versus something that's even a couple of years old.

527
00:25:13,440 --> 00:25:17,120
Speaker 1: You know, new there are new encryption standards for your

528
00:25:17,160 --> 00:25:20,080
Speaker 1: Wi Fi network. There are new Wi Fi standards that

529
00:25:20,160 --> 00:25:24,960
Speaker 1: provide better performance and better speed. So you know, by upgrading,

530
00:25:25,040 --> 00:25:27,120
Speaker 1: despite the fact that people don't want to spend money

531
00:25:27,160 --> 00:25:29,560
Speaker 1: and I get it. You also have to remember every

532
00:25:29,600 --> 00:25:33,360
Speaker 1: single thing you do online through that device is you know,

533
00:25:33,400 --> 00:25:36,720
Speaker 1: whether it's your banking, accessing your work networks, whatever you're

534
00:25:36,720 --> 00:25:39,640
Speaker 1: doing is going through that device, so ensuring its security

535
00:25:39,720 --> 00:25:44,240
Speaker 1: is very important for you, your business, your money, et cetera.

536
00:25:44,760 --> 00:25:47,520
Speaker 1: And you know, one quick piece of advice before amount

537
00:25:47,560 --> 00:25:49,680
Speaker 1: of time. Again, there's lots of new standards. You can

538
00:25:49,720 --> 00:25:53,880
Speaker 1: get much better performance, much better security, get software updates,

539
00:25:54,000 --> 00:25:57,719
Speaker 1: things like WPA three that's the highest level of encryption

540
00:25:57,880 --> 00:26:00,919
Speaker 1: most home Wi Fi routers would support. You know, you

541
00:26:01,000 --> 00:26:03,560
Speaker 1: need to be turning on the highest level of protection

542
00:26:03,680 --> 00:26:06,679
Speaker 1: you can and I would encourage folks. You know, if

543
00:26:06,680 --> 00:26:08,280
Speaker 1: you don't have an irdy friend like me, you can

544
00:26:08,320 --> 00:26:12,560
Speaker 1: talk to check out magazines online like c net, Charlie Net,

545
00:26:12,720 --> 00:26:16,800
Speaker 1: or zd Net, Ziff Davis Net, Tom's Guide, PC Magazine,

546
00:26:17,080 --> 00:26:20,880
Speaker 1: Consumer Reports, They have editors and experts that vet these

547
00:26:20,920 --> 00:26:22,760
Speaker 1: things right, so you can go out and say, well,

548
00:26:22,920 --> 00:26:26,040
Speaker 1: what's the best home Wi Fi router for twenty twenty

549
00:26:26,080 --> 00:26:30,040
Speaker 1: five on one of these sites, and they'll give you recommendations.

550
00:26:30,119 --> 00:26:31,960
Speaker 1: You know, do I want the cheapest one? Do I

551
00:26:31,960 --> 00:26:33,800
Speaker 1: want the most powerful one? Do I want the most

552
00:26:33,800 --> 00:26:36,920
Speaker 1: secure one? Do I care about gaming? There's all kinds

553
00:26:36,960 --> 00:26:39,919
Speaker 1: of great advice, And I also encourage people sign up

554
00:26:39,920 --> 00:26:43,200
Speaker 1: and go to IC three dot gov Internet Crimecomplaints Center

555
00:26:43,240 --> 00:26:45,960
Speaker 1: dot gov. It's hosted by the FBI. They put out

556
00:26:45,960 --> 00:26:49,040
Speaker 1: these public service announcements. There's all kinds of useful information there,

557
00:26:49,080 --> 00:26:51,680
Speaker 1: so there's ample resources to help you figure this out.

558
00:26:51,680 --> 00:26:54,000
Speaker 1: But if you have a really old device, take the

559
00:26:54,080 --> 00:26:57,600
Speaker 1: FBI's advice and replace this, because you're setting yourself up

560
00:26:57,600 --> 00:26:58,760
Speaker 1: for disaster if you don't.

561
00:26:59,160 --> 00:27:02,240
Speaker 5: Hey, Dave, is there besides it being old? Are there

562
00:27:02,320 --> 00:27:04,240
Speaker 5: things that the thing that my router could do?

563
00:27:04,320 --> 00:27:04,480
Speaker 2: Well?

564
00:27:04,520 --> 00:27:06,920
Speaker 5: I know that if it's behaving a certain way that

565
00:27:07,040 --> 00:27:08,919
Speaker 5: I maybe I should be paying more attention. You know,

566
00:27:08,960 --> 00:27:11,040
Speaker 5: obviously you know that there are there are model numbers

567
00:27:11,040 --> 00:27:13,119
Speaker 5: and things we can look at too, but just in general,

568
00:27:13,160 --> 00:27:14,640
Speaker 5: should are there things I should watch for?

569
00:27:14,760 --> 00:27:16,240
Speaker 6: Just in terms of his normal performance.

570
00:27:16,920 --> 00:27:18,439
Speaker 2: Yeah, that's a good question. You know.

571
00:27:18,520 --> 00:27:21,439
Speaker 1: One of the reasons why they've put out this PSA is,

572
00:27:21,640 --> 00:27:24,000
Speaker 1: you know, for these really old routers, it's not that

573
00:27:24,160 --> 00:27:26,879
Speaker 1: hard for hackers to find these. There's a search engine

574
00:27:26,920 --> 00:27:30,879
Speaker 1: called Showdance specifically designed to find Internet connected devices, so

575
00:27:31,000 --> 00:27:35,760
Speaker 1: bad guys can go look up routers that have known defects.

576
00:27:36,760 --> 00:27:39,080
Speaker 1: They can infiltrate your router, and then they'll use it

577
00:27:39,160 --> 00:27:41,879
Speaker 1: essentially as a proxy or for other nefarious purposes, so

578
00:27:41,920 --> 00:27:45,160
Speaker 1: they're they're routing they're bad activities through your router, which

579
00:27:45,160 --> 00:27:47,600
Speaker 1: also means you could get a visit from the FBI someday.

580
00:27:47,640 --> 00:27:49,960
Speaker 1: If you look into that, you'll find that has happened before.

581
00:27:50,760 --> 00:27:53,040
Speaker 1: But yeah, if if you're if it used to work

582
00:27:53,080 --> 00:27:56,960
Speaker 1: fine and now it suddenly starts to lose its connectivity,

583
00:27:57,600 --> 00:28:01,440
Speaker 1: your speed goes to near zero, it seems to overheat,

584
00:28:01,560 --> 00:28:03,840
Speaker 1: or just suddenly starts acting weird. I mean that could

585
00:28:03,880 --> 00:28:06,119
Speaker 1: just be a sign that that's getting old and tired,

586
00:28:06,240 --> 00:28:09,840
Speaker 1: or could be a sign of some sort of infestation

587
00:28:10,000 --> 00:28:13,760
Speaker 1: from some hackers somewhere. And again, with these newer devices,

588
00:28:13,840 --> 00:28:16,520
Speaker 1: they're much harder to hack. They're getting the security patches

589
00:28:16,560 --> 00:28:20,639
Speaker 1: from their vendors. They're much easier to secure. All the

590
00:28:20,680 --> 00:28:23,880
Speaker 1: reasons why you should really think about replacing anything that Again,

591
00:28:23,920 --> 00:28:25,560
Speaker 1: I would say if it's five or six years old,

592
00:28:25,600 --> 00:28:27,159
Speaker 1: you should take a hard look at replacing it.

593
00:28:27,440 --> 00:28:29,080
Speaker 5: Yeah, and I want to be clear to this is

594
00:28:29,080 --> 00:28:31,520
Speaker 5: something I learned years ago about that We've hinted at

595
00:28:31,520 --> 00:28:32,800
Speaker 5: a couple of times here, but just to say it

596
00:28:32,840 --> 00:28:36,000
Speaker 5: a third time, you do not have to rent devices

597
00:28:36,880 --> 00:28:39,080
Speaker 5: from your internet provider anymore than you have to rent

598
00:28:39,120 --> 00:28:42,120
Speaker 5: a lawn sprinkler from the water company. They can't control

599
00:28:42,160 --> 00:28:44,920
Speaker 5: what you're connecting to that connection, So you can be

600
00:28:44,960 --> 00:28:46,880
Speaker 5: in full control of this and save yourself a little

601
00:28:46,880 --> 00:28:48,479
Speaker 5: money at the same time, Dave, I'm going to ask

602
00:28:48,520 --> 00:28:50,440
Speaker 5: you a little bit of a loaded question. Have we

603
00:28:50,560 --> 00:28:53,640
Speaker 5: heard from the ulti fibers and the spectrums of the

604
00:28:53,680 --> 00:28:56,680
Speaker 5: world as from there? Are they raising a flag on

605
00:28:56,720 --> 00:28:58,239
Speaker 5: any of this? And do you have any idea if

606
00:28:58,240 --> 00:29:00,840
Speaker 5: they would bear any liability. That's all lawyer question and

607
00:29:00,920 --> 00:29:02,680
Speaker 5: none of us is one, but I'm asking anyway.

608
00:29:03,440 --> 00:29:05,719
Speaker 1: Yeah, I have not seen, like you know, I use

609
00:29:05,800 --> 00:29:09,000
Speaker 1: Spectrum at home. I have not seen any communication from

610
00:29:09,040 --> 00:29:11,600
Speaker 1: Spectrum in this regard. Now, again, you know, they will

611
00:29:11,640 --> 00:29:15,239
Speaker 1: occasionally replace their equipment and so forth, and you know,

612
00:29:15,360 --> 00:29:17,880
Speaker 1: I would encourage people to your point to not rent

613
00:29:17,920 --> 00:29:20,120
Speaker 1: their equipment and go for some of the higher end

614
00:29:20,400 --> 00:29:22,800
Speaker 1: and relatively inexpensive. You know, if you spend three hundred

615
00:29:22,800 --> 00:29:25,280
Speaker 1: dollars on a fairly high end Wi Fi router and

616
00:29:25,360 --> 00:29:27,680
Speaker 1: you advertise that over five or six years, that's not

617
00:29:27,800 --> 00:29:29,920
Speaker 1: very much money to get a lot more security and

618
00:29:29,960 --> 00:29:33,320
Speaker 1: a lot better capability and probably a lot better performance

619
00:29:33,440 --> 00:29:33,880
Speaker 1: to boot.

620
00:29:34,360 --> 00:29:34,560
Speaker 2: You know.

621
00:29:34,680 --> 00:29:36,160
Speaker 6: All of that said, so, I.

622
00:29:36,040 --> 00:29:39,480
Speaker 1: Haven't seen anything from the Internet service providers in this

623
00:29:39,560 --> 00:29:43,600
Speaker 1: region comment on this particular FBI warning. I think it

624
00:29:43,680 --> 00:29:46,120
Speaker 1: probably is really geared more towards the people like you

625
00:29:46,200 --> 00:29:48,520
Speaker 1: mentioned that have gone out and bought their own equipment,

626
00:29:48,600 --> 00:29:51,200
Speaker 1: perhaps a long time ago. And you know, as far

627
00:29:51,240 --> 00:29:54,239
Speaker 1: as the internet service provider bearing any responsibility, yeah, I'm

628
00:29:54,280 --> 00:29:56,720
Speaker 1: not an attorney, and I'm sure if you read through

629
00:29:56,760 --> 00:29:59,880
Speaker 1: their terms of service there's indignification in there for anything

630
00:29:59,880 --> 00:30:02,800
Speaker 1: that goes wrong using their service. So I kind of

631
00:30:02,920 --> 00:30:03,360
Speaker 1: doubt it.

632
00:30:04,320 --> 00:30:05,960
Speaker 2: But you know, I'm not an attorney.

633
00:30:06,000 --> 00:30:08,120
Speaker 1: And you know, could you get a class action lawsuit

634
00:30:08,160 --> 00:30:11,000
Speaker 1: together for people that have somehow been hacked because they

635
00:30:11,040 --> 00:30:14,520
Speaker 1: had old equipment and they weren't warned and it wasn't replaced.

636
00:30:14,680 --> 00:30:16,280
Speaker 2: Maybe yeah.

637
00:30:16,320 --> 00:30:19,920
Speaker 4: So bottom line is spending that investing that three hundred dollars,

638
00:30:20,080 --> 00:30:23,120
Speaker 4: like you said, advertised over six, seven, eight, ten years

639
00:30:23,280 --> 00:30:27,760
Speaker 4: is way less expensive than going through a dramatic, you know,

640
00:30:27,880 --> 00:30:31,600
Speaker 4: identity theft or fraud situation that could cost you hundreds,

641
00:30:31,600 --> 00:30:34,880
Speaker 4: if not thousands of dollars. Great stuff, as always from

642
00:30:34,920 --> 00:30:38,400
Speaker 4: our tech expert, Dave Hatter. You're listening to Simply Money,

643
00:30:38,400 --> 00:30:41,680
Speaker 4: presented by all Worth Financial on fifty five KARC, the

644
00:30:42,080 --> 00:30:42,640
Speaker 4: talk station.

645
00:30:43,320 --> 00:30:47,320
Speaker 3: It's all in they everywhere. I want to thank you guys.

646
00:30:47,320 --> 00:30:48,600
Speaker 3: You're like my radio neighbors.

647
00:30:48,680 --> 00:30:51,000
Speaker 7: You guys are making me think twice about things.

648
00:30:51,040 --> 00:30:54,760
Speaker 3: Like a sound that lingas in you and I love it.

649
00:30:54,840 --> 00:30:58,959
Speaker 3: Thanks for giving us Democrats boys. Listening to the station,

650
00:30:59,280 --> 00:31:02,680
Speaker 3: I feel like I'm we all matter is. I've been

651
00:31:02,720 --> 00:31:09,000
Speaker 3: tuning in since the election. It's gone up. Talk about

652
00:31:09,040 --> 00:31:12,080
Speaker 3: it here. I get heard on fifty five KRC the

653
00:31:12,320 --> 00:31:15,160
Speaker 3: talk station. Here, get a pack, are welcome to here.

654
00:31:15,280 --> 00:31:17,360
Speaker 2: I do think he is too old to run.

655
00:31:17,600 --> 00:31:18,600
Speaker 6: In twenty twenty.

656
00:31:18,320 --> 00:31:25,960
Speaker 8: Four, fifty five KRC, the talk station. You're listening to

657
00:31:26,000 --> 00:31:28,280
Speaker 8: Simply Money. Because that I buy all Worth Financial. I'm

658
00:31:28,280 --> 00:31:32,000
Speaker 8: Bob sponseller along the Flinger Churn. Give a financial question

659
00:31:32,160 --> 00:31:34,240
Speaker 8: you'd like for us to answer. There is a red

660
00:31:34,320 --> 00:31:36,360
Speaker 8: button you can click while you're listening to the show

661
00:31:36,680 --> 00:31:39,480
Speaker 8: right on the iHeart app. Simply record your question and

662
00:31:39,560 --> 00:31:43,320
Speaker 8: it will come straight to us. Dave and Mary live

663
00:31:43,400 --> 00:31:44,800
Speaker 8: in Mainville and Brian.

664
00:31:44,920 --> 00:31:45,560
Speaker 2: They're wondering.

665
00:31:45,640 --> 00:31:48,760
Speaker 4: They say, Hey, we're in our early sixties and considering

666
00:31:48,920 --> 00:31:52,760
Speaker 4: partial retirement. How do you plan cash flow when income

667
00:31:52,920 --> 00:31:56,680
Speaker 4: becomes unpredictable? Great question, This is a great question. This

668
00:31:56,800 --> 00:31:59,600
Speaker 4: is kind of the key of financial planning. We become

669
00:31:59,720 --> 00:32:03,080
Speaker 4: so custom Bob to living off of o PM other

670
00:32:03,120 --> 00:32:05,960
Speaker 4: people's money. Somebody has to give me some kind of

671
00:32:06,080 --> 00:32:08,440
Speaker 4: check or something so that I can pay my bills.

672
00:32:08,520 --> 00:32:10,360
Speaker 4: That's in the first for the first forty fifty years

673
00:32:10,360 --> 00:32:12,120
Speaker 4: of our lives, that's a job, and then for the

674
00:32:12,200 --> 00:32:15,280
Speaker 4: remainder it becomes social Security or whatever pensions we've built up.

675
00:32:15,480 --> 00:32:17,640
Speaker 4: What we tend to do, though, is ignore the fact

676
00:32:17,680 --> 00:32:19,320
Speaker 4: that if we've done the right things, then there's also

677
00:32:19,520 --> 00:32:23,160
Speaker 4: a significant nest egg out there that can support those bills,

678
00:32:23,440 --> 00:32:27,280
Speaker 4: and that itself becomes you know, that becomes your own money,

679
00:32:27,320 --> 00:32:29,880
Speaker 4: of course, and so so how to plan around this, Well,

680
00:32:30,560 --> 00:32:32,280
Speaker 4: a lot of people want to focus on the I

681
00:32:32,400 --> 00:32:35,080
Speaker 4: need it to spit out a predictable stream of income.

682
00:32:35,160 --> 00:32:37,080
Speaker 4: So maybe I'm gonna do CDs or bonds or just

683
00:32:37,160 --> 00:32:39,640
Speaker 4: something where I know what's coming and when. And that's fine,

684
00:32:39,680 --> 00:32:41,880
Speaker 4: except the what happens there is we often rob the

685
00:32:41,960 --> 00:32:46,120
Speaker 4: ability for growth from that portfolio. So look, I would say,

686
00:32:46,200 --> 00:32:48,320
Speaker 4: you know you're gonna, you're gonna definitely want to keep

687
00:32:48,400 --> 00:32:51,240
Speaker 4: something related to growth, which growth can be unpredictable.

688
00:32:51,320 --> 00:32:53,360
Speaker 5: Something needs to be growing. Even for the littlest old

689
00:32:53,400 --> 00:32:55,040
Speaker 5: widow out there, we still need some growth to keep

690
00:32:55,120 --> 00:32:58,720
Speaker 5: up with inflation. So just understand market history and understand

691
00:32:58,800 --> 00:33:00,760
Speaker 5: model out what it would look like if you invested

692
00:33:00,800 --> 00:33:03,000
Speaker 5: in a certain portfolio and pulled a couple thousand dollars

693
00:33:03,040 --> 00:33:04,920
Speaker 5: out of it every month to bridge the gap between

694
00:33:05,280 --> 00:33:07,400
Speaker 5: your your your social scurity, pension checks and what your

695
00:33:07,400 --> 00:33:09,840
Speaker 5: actual bills are, and then understand what it does when

696
00:33:09,880 --> 00:33:11,800
Speaker 5: the market goes up and most importantly, when the market

697
00:33:11,880 --> 00:33:14,560
Speaker 5: goes down. So it doesn't have to be predictable. It's

698
00:33:14,600 --> 00:33:16,240
Speaker 5: not as predictable as a you know, as like a

699
00:33:16,320 --> 00:33:18,160
Speaker 5: pension or a job. But at the same time, that

700
00:33:18,240 --> 00:33:20,360
Speaker 5: doesn't mean that that is a bad thing. You just

701
00:33:20,480 --> 00:33:22,080
Speaker 5: have to be used to you know what what that

702
00:33:22,240 --> 00:33:25,920
Speaker 5: could look like. So stress tests and understand it. Moving

703
00:33:25,960 --> 00:33:28,520
Speaker 5: to Brian and Levanon, Brian's got about two million dollars

704
00:33:28,560 --> 00:33:31,440
Speaker 5: in retirement accounts and he says their portfolio is mostly

705
00:33:31,520 --> 00:33:33,760
Speaker 5: index based, but he's curious if they're missing out on

706
00:33:33,800 --> 00:33:36,920
Speaker 5: some more tactical active management opportunities. Bob's gonna have a

707
00:33:36,920 --> 00:33:39,320
Speaker 5: field day with this. Is there a case, Bob for

708
00:33:39,480 --> 00:33:42,880
Speaker 5: active management at this level, Well.

709
00:33:42,720 --> 00:33:45,480
Speaker 4: Brian, there can be, and I'll say there can be.

710
00:33:45,720 --> 00:33:48,480
Speaker 4: So you know, when when you talk about index portfolio

711
00:33:49,320 --> 00:33:51,280
Speaker 4: and this is why we like a term we use

712
00:33:51,320 --> 00:33:56,080
Speaker 4: around here is core satellite portfolios, meaning the vast majority

713
00:33:56,440 --> 00:33:59,480
Speaker 4: of the assets and any would all say moderate to

714
00:33:59,560 --> 00:34:03,280
Speaker 4: growth based portfolio are mimicking the large you know s

715
00:34:03,360 --> 00:34:06,680
Speaker 4: and P five hundred Nasdaq type of indices. And we've

716
00:34:06,720 --> 00:34:11,000
Speaker 4: talked on this show multiple times that active money management,

717
00:34:11,160 --> 00:34:15,560
Speaker 4: you know, NETTA fees, typically underperforms a good index index

718
00:34:15,640 --> 00:34:18,640
Speaker 4: based you know fund like what you own, So you're

719
00:34:18,680 --> 00:34:22,960
Speaker 4: not doing anything wrong for sure. There are opportunities, however,

720
00:34:23,120 --> 00:34:26,480
Speaker 4: for active management in other asset classes, and you got

721
00:34:26,600 --> 00:34:28,840
Speaker 4: to look around and look at some of those, you know,

722
00:34:29,239 --> 00:34:33,040
Speaker 4: typical or certain parts of the bond portfolio. You can

723
00:34:33,120 --> 00:34:36,080
Speaker 4: make a case for active management there, things like small

724
00:34:36,160 --> 00:34:40,080
Speaker 4: cap stocks, emerging market stocks there are, and then some

725
00:34:40,800 --> 00:34:44,200
Speaker 4: having some non correlated asset classes in your portfolio that

726
00:34:44,280 --> 00:34:46,479
Speaker 4: can increase return and lower risk.

727
00:34:46,640 --> 00:34:50,720
Speaker 2: That's a reason to have some active Apart from active

728
00:34:51,120 --> 00:34:51,319
Speaker 2: you know.

729
00:34:51,560 --> 00:34:54,200
Speaker 4: Management and returns, there's a bit there can be a

730
00:34:54,280 --> 00:34:58,120
Speaker 4: big case for using some active management from a tech standpoint.

731
00:34:58,520 --> 00:35:00,320
Speaker 2: I know you talked about all your money is in

732
00:35:00,400 --> 00:35:01,240
Speaker 2: retirement accounts.

733
00:35:01,280 --> 00:35:04,920
Speaker 4: We're now talking about non retirement accounts for where having

734
00:35:04,960 --> 00:35:08,880
Speaker 4: a good tax uh managed strategy running in the background,

735
00:35:08,960 --> 00:35:12,400
Speaker 4: harvesting short term losses, using those to offset gains.

736
00:35:12,880 --> 00:35:13,000
Speaker 1: UH.

737
00:35:13,320 --> 00:35:17,400
Speaker 4: Those are often at a ton of value to a portfolio. So, uh,

738
00:35:17,480 --> 00:35:19,719
Speaker 4: there's reasons to have some of this stuff in there.

739
00:35:20,520 --> 00:35:22,600
Speaker 4: It's on a case by case basis, but it's a

740
00:35:22,680 --> 00:35:26,239
Speaker 4: great question. Brian, all right, Ron and Mason, We've got

741
00:35:26,280 --> 00:35:28,800
Speaker 4: a says we've got a paid off house, but a

742
00:35:28,920 --> 00:35:32,279
Speaker 4: lot of equity sitting idle. What's the smartest way to

743
00:35:32,440 --> 00:35:36,840
Speaker 4: use that equity invest downsize or just leave it alone?

744
00:35:37,360 --> 00:35:39,600
Speaker 5: Yeah, this is that we'll get this question quite as

745
00:35:39,680 --> 00:35:41,840
Speaker 5: often anymore. I got it a lot when when mortgage

746
00:35:41,880 --> 00:35:44,480
Speaker 5: rates were in the you know, the three percent range,

747
00:35:44,560 --> 00:35:47,239
Speaker 5: sometimes even two percent, because people are simply looking at

748
00:35:47,280 --> 00:35:49,080
Speaker 5: this is the hundreds of thousands, if not millions of

749
00:35:49,120 --> 00:35:51,160
Speaker 5: dollars that I've got sitting here in an asset that's

750
00:35:51,200 --> 00:35:52,280
Speaker 5: not spitting out any income.

751
00:35:52,320 --> 00:35:53,520
Speaker 6: How can I take advantage of that?

752
00:35:53,840 --> 00:35:55,960
Speaker 5: Well, really, the only way to take advantage of it

753
00:35:56,160 --> 00:35:59,640
Speaker 5: is to is to somehow, you know, borrow against it

754
00:35:59,719 --> 00:36:02,000
Speaker 5: to the money out. Unless you're going to airbnb one

755
00:36:02,040 --> 00:36:04,120
Speaker 5: of your rooms in your house and have awkward meetings

756
00:36:04,160 --> 00:36:06,600
Speaker 5: in the hallway with strangers, there's not really a good

757
00:36:06,640 --> 00:36:09,120
Speaker 5: efficient way to get money out right now. If you're

758
00:36:09,120 --> 00:36:10,480
Speaker 5: going to borrow against your home, you're going to be

759
00:36:10,520 --> 00:36:12,480
Speaker 5: paying about six percent in a home equity line.

760
00:36:12,680 --> 00:36:14,160
Speaker 6: I don't think that that that's the worst thing.

761
00:36:14,200 --> 00:36:15,880
Speaker 5: If you actually have a need, that can be a

762
00:36:15,920 --> 00:36:18,439
Speaker 5: pretty good way to finance a significant.

763
00:36:18,000 --> 00:36:20,239
Speaker 6: Uh, you know, an expense you have.

764
00:36:20,440 --> 00:36:22,160
Speaker 5: Maybe it's a better deal than you can get from

765
00:36:22,160 --> 00:36:23,920
Speaker 5: the car dealer or buy a car, or maybe you

766
00:36:24,040 --> 00:36:26,720
Speaker 5: need you know you're gonna use it for college expenses,

767
00:36:26,760 --> 00:36:29,759
Speaker 5: something like that. But simply to pull money out and

768
00:36:30,239 --> 00:36:33,440
Speaker 5: use it to make an investment that you hope is

769
00:36:33,440 --> 00:36:34,920
Speaker 5: going to earn more than six percent. I don't think

770
00:36:34,920 --> 00:36:36,840
Speaker 5: that's worth it right now, so I would focus on

771
00:36:36,960 --> 00:36:38,919
Speaker 5: am I happy in my home? Is this the place

772
00:36:39,000 --> 00:36:41,200
Speaker 5: that I want to be? If not, then let's think

773
00:36:41,239 --> 00:36:43,719
Speaker 5: about some kind of different arrangement. But otherwise, don't treat

774
00:36:43,760 --> 00:36:44,440
Speaker 5: it as a piggybank.

775
00:36:45,560 --> 00:36:45,880
Speaker 2: All right.

776
00:36:45,920 --> 00:36:48,640
Speaker 4: If you're paying seven hundred dollars or more for a

777
00:36:48,719 --> 00:36:52,319
Speaker 4: premium credit card, rising fees might force you to choose

778
00:36:52,480 --> 00:36:56,160
Speaker 4: which one of those cards is actually worth keeping, will

779
00:36:56,200 --> 00:36:58,800
Speaker 4: help you evaluate your options. Next, you're listening to Simply

780
00:36:58,840 --> 00:37:01,640
Speaker 4: Money presented by all Worth Financial on fifty five KRC

781
00:37:02,160 --> 00:37:03,320
Speaker 4: the talk station.

782
00:37:03,880 --> 00:37:06,680
Speaker 9: And of course not just one sided view us that

783
00:37:06,760 --> 00:37:08,719
Speaker 9: affects you at the top end to bottom of the

784
00:37:08,800 --> 00:37:17,160
Speaker 9: hour fifty five KRC the talk station, you're.

785
00:37:17,000 --> 00:37:19,440
Speaker 4: Listening to Simple Money presented by all Worth Financial on

786
00:37:19,520 --> 00:37:23,879
Speaker 4: Bob's sponseller along with Brian James. Many people have these

787
00:37:24,040 --> 00:37:27,960
Speaker 4: high end credit cards, riding the perks and weaving between

788
00:37:28,040 --> 00:37:31,319
Speaker 4: the value among the different cards. But now with these

789
00:37:31,480 --> 00:37:36,320
Speaker 4: issuers starting to, you know, increase annual fees, the question

790
00:37:36,560 --> 00:37:40,000
Speaker 4: is shifting from should I get a premium card to

791
00:37:40,160 --> 00:37:44,640
Speaker 4: which premium card I should keep Brian in all honesty

792
00:37:45,040 --> 00:37:47,680
Speaker 4: for questions like this one. You know I come to

793
00:37:47,760 --> 00:37:49,840
Speaker 4: you for this stuff because I know you study this

794
00:37:49,920 --> 00:37:52,719
Speaker 4: stuff and know a lot about it. I'm I'm very

795
00:37:52,840 --> 00:37:54,760
Speaker 4: eager to hear what you have to say on this topic.

796
00:37:54,840 --> 00:37:56,280
Speaker 4: And I mean that in all honesty.

797
00:37:56,440 --> 00:37:59,080
Speaker 5: Yeah, my family has gotten a lot out of their

798
00:37:59,080 --> 00:38:01,439
Speaker 5: credit card reward. We had a credit card over twenty

799
00:38:01,520 --> 00:38:03,680
Speaker 5: years that was paying money into a five twenty nine

800
00:38:03,719 --> 00:38:05,600
Speaker 5: plan and I'm now very happily on the back end

801
00:38:05,640 --> 00:38:07,719
Speaker 5: of that pulling dollars out for tuition. It was free

802
00:38:07,760 --> 00:38:09,399
Speaker 5: money and it was one of the smartest things I've

803
00:38:09,400 --> 00:38:12,600
Speaker 5: ever done. So why are their higher fees in these cards? Well,

804
00:38:12,600 --> 00:38:15,239
Speaker 5: the credit card issuers, Remember these aren't the banks. There

805
00:38:15,280 --> 00:38:17,279
Speaker 5: are two entities behind a credit card. It's the credit

806
00:38:17,320 --> 00:38:19,520
Speaker 5: card issuer, that's Visa master Cards. They are the ones

807
00:38:19,520 --> 00:38:22,400
Speaker 5: who want the spending because they're taking a haircut off

808
00:38:22,440 --> 00:38:24,400
Speaker 5: of every little transaction. Every time you wipe that you

809
00:38:24,480 --> 00:38:26,760
Speaker 5: swipe that card, they get two or three percent, sometimes

810
00:38:26,840 --> 00:38:30,359
Speaker 5: even four And they know that typical premium card user,

811
00:38:30,400 --> 00:38:32,080
Speaker 5: if you've already got a fee on your card, then

812
00:38:32,120 --> 00:38:33,960
Speaker 5: that's got it. Then that's a premium card out there.

813
00:38:34,000 --> 00:38:35,759
Speaker 5: They know these people are high spenders, pay off the

814
00:38:35,800 --> 00:38:37,920
Speaker 5: balance every month and is a low credit risk. Those

815
00:38:37,960 --> 00:38:41,320
Speaker 5: are the customers the issuers want, the banks behind it,

816
00:38:41,440 --> 00:38:43,320
Speaker 5: wants somebody who's going to let it go and ignore

817
00:38:43,360 --> 00:38:46,480
Speaker 5: it so they can charge them the ridiculous interest rates

818
00:38:46,520 --> 00:38:49,120
Speaker 5: twenty five twenty eight percent. So what they're hoping is

819
00:38:49,160 --> 00:38:52,279
Speaker 5: that fewer card holders overall, but those stickier relationships and

820
00:38:52,360 --> 00:38:55,279
Speaker 5: more interchange spend focused on that one card that they

821
00:38:55,360 --> 00:38:57,120
Speaker 5: think is the best one to use. That's what I did,

822
00:38:57,320 --> 00:38:59,000
Speaker 5: like I said, for for a long time. So how

823
00:38:59,040 --> 00:39:01,520
Speaker 5: do you think about this? Run a break even analysis.

824
00:39:01,560 --> 00:39:03,560
Speaker 5: If you've got two or more of these premium cards,

825
00:39:03,600 --> 00:39:06,040
Speaker 5: make a spreadsheet, figure out your real usage. You know,

826
00:39:06,160 --> 00:39:08,400
Speaker 5: are you really using those lounge visits and the hotel

827
00:39:08,440 --> 00:39:11,000
Speaker 5: airline credits? Are the lounges open. I have one of

828
00:39:11,040 --> 00:39:12,919
Speaker 5: these cards, and about half the time there just isn't

829
00:39:12,960 --> 00:39:14,719
Speaker 5: room they'll let you in in the time that you've

830
00:39:14,719 --> 00:39:17,239
Speaker 5: got to lay over. Make sure you're actually getting the

831
00:39:17,360 --> 00:39:19,600
Speaker 5: value out of these different perks. Are you using the

832
00:39:19,680 --> 00:39:22,800
Speaker 5: free thing that they give you? You know, so sometimes

833
00:39:22,880 --> 00:39:25,920
Speaker 5: both cards will cover lounge access or global entry tsa

834
00:39:26,000 --> 00:39:27,759
Speaker 5: pre check. Well, now you've got that twice, you really

835
00:39:27,800 --> 00:39:29,600
Speaker 5: only need it once, So one of them is redundant

836
00:39:29,640 --> 00:39:31,920
Speaker 5: and that has no value for you. But at the

837
00:39:31,960 --> 00:39:34,080
Speaker 5: same time, if you decide you're gonna cancel one of them,

838
00:39:34,120 --> 00:39:37,399
Speaker 5: first off, be super careful. Don't cancel your low your

839
00:39:37,440 --> 00:39:39,759
Speaker 5: oldest credit card. Hang onto that one unless it's an

840
00:39:39,920 --> 00:39:42,680
Speaker 5: enormous fee. You're gonna want that twenty twenty five years

841
00:39:42,719 --> 00:39:44,480
Speaker 5: where because that's what's giving you a lot of your

842
00:39:44,520 --> 00:39:46,600
Speaker 5: credit score. But if you are going to cancel one,

843
00:39:46,800 --> 00:39:49,440
Speaker 5: ask for retention. They might throw you a you know,

844
00:39:49,480 --> 00:39:51,439
Speaker 5: a better deal, some kind of hidden perk or something

845
00:39:51,680 --> 00:39:53,719
Speaker 5: that they only hold back when somebody wants to or

846
00:39:53,960 --> 00:39:55,560
Speaker 5: offer out when somebody wants to cancel.

847
00:39:56,239 --> 00:39:57,320
Speaker 6: But again, the whole.

848
00:39:57,160 --> 00:39:58,800
Speaker 5: Point of this is just be aware, what are you

849
00:39:58,960 --> 00:40:01,720
Speaker 5: using a lot of card? Just never redeem these credits

850
00:40:01,760 --> 00:40:04,000
Speaker 5: or they just don't use all the benefits. Some of

851
00:40:04,040 --> 00:40:05,680
Speaker 5: the perks are just too hard to use, so they

852
00:40:05,719 --> 00:40:07,799
Speaker 5: look great in the brochure, but you never actually use them.

853
00:40:07,840 --> 00:40:10,040
Speaker 5: So just understand what it offers you and whether you

854
00:40:10,239 --> 00:40:12,480
Speaker 5: value that great stuff.

855
00:40:12,600 --> 00:40:14,560
Speaker 4: Brian and this is why I'm so blessed to have

856
00:40:14,719 --> 00:40:16,920
Speaker 4: you around to give me advice on stuff like this,

857
00:40:17,320 --> 00:40:19,719
Speaker 4: because I honestly I never look at it at all,

858
00:40:19,800 --> 00:40:20,680
Speaker 4: but good stuff.

859
00:40:20,719 --> 00:40:21,840
Speaker 2: All right, thanks for listening.

860
00:40:22,200 --> 00:40:24,399
Speaker 4: You've been listening to Simply Money, presented by all Worth

861
00:40:24,440 --> 00:40:27,560
Speaker 4: Financial on fifty five KRC, the Talk Station.

862
00:40:28,520 --> 00:40:30,279
Speaker 3: You got a lot to do, do you?

863
00:40:30,520 --> 00:40:32,840
Speaker 4: I do got to put up these Halloween decorations, do

864
00:40:33,000 --> 00:40:34,120
Speaker 4: some work, do the laundry.

865
00:40:34,280 --> 00:40:36,520
Speaker 2: We do have to go shopping. Will this is what

866
00:40:36,680 --> 00:40:36,840
Speaker 2: we do.

867
00:40:37,280 --> 00:40:39,640
Speaker 3: Do the rest, it's time to do it. We do

868
00:40:39,760 --> 00:40:41,840
Speaker 3: traffic and weather, doing the news at the top and

869
00:40:41,880 --> 00:40:42,720
Speaker 3: bottom of the hours.

870
00:40:42,760 --> 00:40:44,840
Speaker 2: This is the most important thing we can do. Dude,

871
00:40:44,920 --> 00:40:46,759
Speaker 2: check in. Let's do it the way you want.

872
00:40:46,880 --> 00:40:47,640
Speaker 6: I do need to know.

873
00:40:47,760 --> 00:40:50,960
Speaker 3: It's important that we do it today while doing your day.

874
00:40:51,040 --> 00:40:51,800
Speaker 2: There's always more to do.

875
00:40:51,960 --> 00:40:54,319
Speaker 3: I ain't doing nothing today. I do have something to say,

876
00:40:54,400 --> 00:40:57,880
Speaker 3: so let's do it. On fifty five KR, the Talk Station.