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Speaker 1: Welcome to How the Money. I'm Joel and I and

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Speaker 1: Matt's and today we are answering your listener questions. That's right, Joel,

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Speaker 1: We've got a listener question Monday episode lined up for folks,

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Speaker 1: and we've got five questions that we're gonna answer on

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Speaker 1: this episode, including some ways that you can maximize your savings.

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Speaker 1: We've got some grad school considerations that we're gonna talk through,

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Speaker 1: as well as ways to avoid capital gains tax when

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Speaker 1: it comes to selling uh some real estate. So we've

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Speaker 1: got those questions plus two more. But first, man, we

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Speaker 1: wanted to talk about software on your computer. Doesn't sounds

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Speaker 1: so exciting. So recently we talked about how I had

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Speaker 1: avoided updating the iOS on my computer for like multiple

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Speaker 1: years in order from my old school Microsoft Excel to

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Speaker 1: continue to work, right, because with an updates, I knew

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Speaker 1: like that legacy version wasn't gonna work anymore. And we

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Speaker 1: basically talked about how that was cheap, right, it was

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Speaker 1: a cheap move to avoid the software patches, bug fixes,

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Speaker 1: everything else that accompany a new software update. However, listener, Scott,

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Speaker 1: he reached out to us and mentioned how we need

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Speaker 1: to check out Libra Office. Had had you heard of

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Speaker 1: Libra Office before he sent that email. I had not,

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Speaker 1: But when he sent the email, he said that it

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Speaker 1: was the newer version of Open Office, which was now

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Speaker 1: defunct I think, right, or yeah, it changed or something. Yeah,

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Speaker 1: and I remember open Office back in the day, but

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Speaker 1: I totally forgot that Libra Office was the thing. Yeah.

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Speaker 1: So this is an open platform software and they basically

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Speaker 1: have all the different apps, all the different programs that

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Speaker 1: you would typically use when you get like Microsoft Office

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Speaker 1: or three whatever they're calling it now. Like they've got

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Speaker 1: their document program that's called Writer Document and their equivalent

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Speaker 1: to Excel is called CALC Spreadsheet. So I love how

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Speaker 1: they've got it's totally white label generic names. But basically

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Speaker 1: they are like old school versions of Microsoft that I mean,

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Speaker 1: it's open source and so they've written it to be

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Speaker 1: able to you know, it's compatible with newer Excel documents,

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Speaker 1: like you can open the file formats that are that

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Speaker 1: you currently use with you know, Word or Excel. However,

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Speaker 1: it's not a Microsoft program and so it's open source. Uh,

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Speaker 1: it means other folks keep up with it. And best

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Speaker 1: of all, of course, it is completely free, so you

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Speaker 1: can avoid paying you know, like what we talked about

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Speaker 1: was paying that annual fee, uh that one time once

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Speaker 1: a year cost to get a little bit of a discount,

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Speaker 1: or you can go full on free avoid paying that altogether.

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Speaker 1: And when we got that email from Scott Matt, you

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Speaker 1: were like, all right, give this the shots. He immediately

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Speaker 1: jumped on. I was like, what is this? What is

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Speaker 1: this magic? And anywhere near is good? And you felt

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Speaker 1: like it was definitely better than like the Google version

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Speaker 1: that you were using, right yeah, I mean yeah, So

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Speaker 1: what's great about like one of the great things about

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Speaker 1: at least about CALC Spreadsheet is that you can, or

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Speaker 1: in the whole platform too, you can create shortcuts, uh.

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Speaker 1: And that's one of the cool things that you know,

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Speaker 1: where you're bits, like say you are using like Google

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Speaker 1: Sheets or Google Docs things like that. There's only so

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Speaker 1: much that you can do within a web browser, right,

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Speaker 1: but I love how you can go and create these shortcuts.

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Speaker 1: You can create customized key strokes within these programs, and

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Speaker 1: so you can get it to perform, you know, exactly

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Speaker 1: like Microsoft Excel or even better, you know, you can

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Speaker 1: kind of tailor fit it to to what, you know,

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Speaker 1: whatever your specific needs are. Uh. So yeah, I just

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Speaker 1: actually checked it out and I'm gonna definitely give it

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Speaker 1: a go. Man nice all right, well yeah, if you

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Speaker 1: can cut it down from eighty bucks a year to free,

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Speaker 1: that's uh, that's what I'm saving. So host fig thanks

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Speaker 1: to Scott for sending us an email. Now, we always

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Speaker 1: learned from our listeners. I love that I learned from listeners.

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Speaker 1: In the Facebook group, we get emails I feel like

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Speaker 1: multiple times a day from listeners who have different suggestions

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Speaker 1: and like, hey, dummies, what about this? And it's helpful

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Speaker 1: because you know what you and I we don't know everything,

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Speaker 1: not even close to it. And so it really does

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Speaker 1: take the how of money community to help each other out.

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Speaker 1: And those listener emails help a lot. They really mean

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Speaker 1: a lot. So thank you Scott and other people for

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Speaker 1: reaching out whenever we're wrong or we just like don't

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Speaker 1: know something. All right, Matt, let's mention the beer that

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Speaker 1: we're having on the show today. This one is called

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Speaker 1: Seven Deadly Stounts. It's by Monday Night Brewing. They are

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Speaker 1: around the corner from us, one of our favorite local brewers,

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Speaker 1: and this is a particularly special staut that they brewed,

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Speaker 1: and we're excited to have this one on the show today. Yeah,

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Speaker 1: this is normally the kind of beer that we would

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Speaker 1: have like on a really special occasion. So I don't

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Speaker 1: know why we haven't cracked this thing open yet. Uh

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Speaker 1: that I am really excited about sharing our thoughts on

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Speaker 1: this beer at the end of this episode. Let's do

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Speaker 1: it right. But for now, let's get onto the listener questions.

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Speaker 1: And for folks that want to ask a question on

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Speaker 1: any future on an upcoming Ask How the Money episode,

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Speaker 1: just go to our website how to Money dot com

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Speaker 1: slash ask. There are simple instructions there so you can

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Speaker 1: submit your voicemail question and we hope to be able

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Speaker 1: to take it soon. And Matt, let's get to the

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Speaker 1: first one for this episode. This is from a listener

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Speaker 1: who is trying to decide whether she should go to

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Speaker 1: grad school abroad or stay stateside. Hi, guys, my name

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Speaker 1: is Natalie. I'm twenty one and I'm from Central California.

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Speaker 1: I'm graduating from UC Santa Barbara at this spring with

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Speaker 1: no loans. I'm now deciding on to grad school to

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Speaker 1: get my master's in public administration. Right now, my choices

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Speaker 1: are between a two year program in California that costs

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Speaker 1: about forty dollars before housing, or a one year program

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Speaker 1: in Ireland that costs about twenty dollars after housing. This

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Speaker 1: is my first time taking out loans. I'm concerned if

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Speaker 1: I go abroad I won't have as good of an

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Speaker 1: opportunity to network in order to get a high paying

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Speaker 1: job back in California. But I'm also worried about taking

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Speaker 1: out of forty loan. I studied abroad, so I am

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Speaker 1: familiar and comfortable with the process of moving to Europe.

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Speaker 1: But I don't want to miss out on networking if

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Speaker 1: that's going to be the best decision career wise. I'm

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Speaker 1: excited to hear what you guys think, so let me

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Speaker 1: know in cheers. Natalie thinks so much for that question,

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Speaker 1: and by cheers you actually mean Slancha, right. Yeah. Ireland

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Speaker 1: is actually the only trip that Joel and I have

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Speaker 1: taken abroad together. This is back before we had kids. Man,

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Speaker 1: it was so much thinking, fun, beautiful country. Like I

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Speaker 1: totally see myself going back there one of these days.

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Speaker 1: The pub culture is wonderful in Ireland, so so much fun,

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Speaker 1: live music. I mean, these are all things that I

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Speaker 1: guess probably have been on hold, you know, for the

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Speaker 1: past year, but I'm guessing that they are probably ready

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Speaker 1: to fire things back up. But so you know, we'll

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Speaker 1: try and not let our personal bias influence how we

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Speaker 1: answer your question. And also to congrats on graduating with

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Speaker 1: no loans and on continuing your education as well. Yeah,

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Speaker 1: let's talk about loans, Matt for for just a second longer.

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Speaker 1: On that note, this is a question I think for

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Speaker 1: Natalie where she's going to want to be frugal and

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Speaker 1: not cheap. This is something we've talked about with higher

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Speaker 1: education before. I think, you know, obviously there is a

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Speaker 1: student loan epidemic almost in this country right with with

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Speaker 1: how they've got out of hand, and a lot of

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Speaker 1: people owe so much money when they graduate from college,

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Speaker 1: and we want people to avoid that, right, We want

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Speaker 1: people to be smart about taking on college debt and

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Speaker 1: not take on too much. But broadly speaking, when it

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Speaker 1: comes to the cost of higher education, spending money now

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Speaker 1: that will lead to advanced opportunities in the future isn't

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Speaker 1: wasted money. And uh, I think it's healthy for Natalie

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Speaker 1: had to have that uneasiness that she has about student

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Speaker 1: loan debt, but also it's important to think of it instead,

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Speaker 1: is money going towards increasing your human capital, which will

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Speaker 1: pay dividends for decades to come. Although opting Natalie for

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Speaker 1: that California program it doesn't necessarily mean that the increased

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Speaker 1: costs are going to lead to more opportunity or greater

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Speaker 1: pay in the future. It's kind of hard for Matt

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Speaker 1: Night to really know without having, you know, a few

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Speaker 1: more specifics. Yes, that is right. And something else to

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Speaker 1: consider too, Natalie, is that, uh a two year program

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Speaker 1: in California that costs forty thou before housing, Like that

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Speaker 1: could end up costing you closer to sixty right, which

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Speaker 1: is our seventy maybe? I mean yeah, seriously, And if

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Speaker 1: you look at it that way, like that's closer to

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Speaker 1: a forty thou dollar difference. Ireland is is one of

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Speaker 1: the greatest spots on planet Earth, so going there while

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Speaker 1: also getting the smaller price tag sounds pretty good in me.

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Speaker 1: And you know, one of the key bonuses for opting

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Speaker 1: for Ireland instead is that it's a one year program,

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Speaker 1: not a two year program, And so this means that

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Speaker 1: you are going to be on your way to launching

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Speaker 1: your career and making money a whole year sooner, less

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Speaker 1: money spent out of pocket and earning money sooner Like

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Speaker 1: that sounds like a great combination to me. And another

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Speaker 1: thought too is you know she's talking about networking, right

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Speaker 1: how that's kind of like the biggest downside to going

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Speaker 1: to Ireland. But if there's something that the pandemic has

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Speaker 1: has taught us, I think is that there is so

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Speaker 1: much that we can do from home in our sweatpants.

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Speaker 1: Is I think if she wants to kind of you know,

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Speaker 1: start that networking while she is abroad, so much of

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Speaker 1: that can be done from the computer. You know. I

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Speaker 1: think she could like start writing a blogs, you know,

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Speaker 1: maybe start writing for other publications within the field that

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Speaker 1: she's interested in, you know, launching herself into, and then

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Speaker 1: just start sending out cold emails basically introducing herself. Uh,

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Speaker 1: it's just gonna be a way that she's gonna allow

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Speaker 1: herself to stand out. I think then just subscribing to

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Speaker 1: a program, to your program in California, you know, like

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Speaker 1: the grad who's in Europe in Ireland studying abroad. Like,

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Speaker 1: to me, that's way more interesting and I think that's

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Speaker 1: a great way to to stand out as well. Yeah,

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Speaker 1: my friend Kim who was looking for work. She started

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Speaker 1: just to kind of introduce herself to people on LinkedIn,

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Speaker 1: and dude, I can't tell you how many calls that

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Speaker 1: she set up, not even just like messaging back and

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Speaker 1: forth or emails. It was like phone calls that people

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Speaker 1: were like, Hey, let's go on the phone and chat.

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Speaker 1: And yeah, So I feel like networking online is one

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Speaker 1: of those things where people are craving human connection, even

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Speaker 1: if it is just virtually. And so, yeah, I think

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Speaker 1: you're right that the pandemic has taught us that we

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Speaker 1: can network virtually, and and so I don't think, um,

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Speaker 1: if you're intentional about it, that you're gonna be losing

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Speaker 1: much in that regard. And not only I think you're

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Speaker 1: you're gonna want to make that call. You know, your

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Speaker 1: decision based on a number of different things, many of

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Speaker 1: which Matt and I aren't privy to. Here, is it

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Speaker 1: the connections that you're worried about missing out on, or

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Speaker 1: maybe just that degree that you'll receive from a university

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Speaker 1: in California look better to potential employers because that's something

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Speaker 1: the factor into Can you use that maybe additional year

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Speaker 1: to gain some valuable connections and work experience at the

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Speaker 1: same time, and uh, again, don't be cheap when it

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Speaker 1: comes to this decision. But also don't assume that more

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Speaker 1: expensive equals more connections that's going to result in more

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Speaker 1: pay Just because you're on site in California doesn't automatically

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Speaker 1: mean that there's gonna be mixers going on that you're

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Speaker 1: gonna be invited to where you get to show up

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Speaker 1: and start, you know, shaking hands. I think that there's

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Speaker 1: you know, we're probably gonna see more of that this fall,

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Speaker 1: but I don't I can't imagine it's going to be

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Speaker 1: in full force like it was pre pandemic as well,

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Speaker 1: So I think that's definitely a consideration as well. Yeah,

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Speaker 1: but Natalie, either way you go, you're in a strong

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Speaker 1: position right now by not having any student loan debt.

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Speaker 1: So best of luck as you move forward. And hopefully

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Speaker 1: Matt and E's thoughts helped at least a little bit.

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Speaker 1: But we got more questions to get to, including a

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Speaker 1: listener who's worried that credit card debt might creep back

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Speaker 1: up in his life. We'll get to that one right

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Speaker 1: after this break. Al Right, we are back from the break,

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Speaker 1: and we're gonna get to a question here soon about

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Speaker 1: where to put some retirement money. But before that, let's

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Speaker 1: get to that one, Joel that you mentioned about credit

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Speaker 1: card debt kind of creeping back into this guy's life. Hey, guys,

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Speaker 1: thanks so much for the podcast. We look forward to

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Speaker 1: it every week. You've definitely helped me clarify law I

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Speaker 1: thinks personal financial, giving me a strong action. Currently, I'm

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Speaker 1: twenty nine years old. My partner and I are saving

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Speaker 1: up for a house we'd like to purchase within the year.

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Speaker 1: I just finished paying off twenty six dollars in debt.

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Speaker 1: In the process of paying off the debt, I had

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Speaker 1: closed a credit card. I noticed when I closed a

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Speaker 1: credit card, my cardit score dropped about eighty points. Then

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Speaker 1: I listened to one of your episodes where you discussed

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Speaker 1: how useful and tac talent credit card can be one

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Speaker 1: purchasing a host. I panicked, applied for another credit card,

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Speaker 1: and got another credit card, where my credit card dropped

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Speaker 1: again by about twenty points. I'm now worried that my

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Speaker 1: old habits might creep in and I'll start spending on

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Speaker 1: the credit card and carry a balance on it. I'm

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Speaker 1: not sure if I should close it or if I

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Speaker 1: should just hide it and put it away and keep

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Speaker 1: on track with my saving Let me know what you think.

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Speaker 1: Thank you so much. Anything can contribute will help. By

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Speaker 1: the way, that question came from a listener named Matt,

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Speaker 1: so he must be cool like my best buddy. Thanks.

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Speaker 1: Do you think we get more questions from Mats or

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Speaker 1: Mats for sure? Really? Well, it's just like a more

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Speaker 1: common name. Yeah, it's kind of like John or nearly

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Speaker 1: as many of us Joels out there, sadly, But Matt,

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Speaker 1: congrats on the strides you've made it. I think it's too.

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Speaker 1: It's definitely important to celebrate the debt payoff accomplishment that

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Speaker 1: you've made. Being able to pay off twenty six dollars

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Speaker 1: of debt is a huge sum of money. That's big. Yeah,

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Speaker 1: it's worth celebrating with a nice beer or something like that.

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Speaker 1: Seven Deadly stouts if you get if you can get

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Speaker 1: your hands on one, yeah, already, I'm gonna tell you.

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Speaker 1: I suggest it. So it's so good. But let's talk

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Speaker 1: about why your credit score is so important too. If

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Speaker 1: you want to buy a house within the year, Matt,

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Speaker 1: closing cards is gonna crush your score and could cost

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Speaker 1: you potentially thousands in interest over the life of the

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Speaker 1: homeland that you're gonna get, and it could make that

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Speaker 1: loan harder to get in the first place. And that's

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Speaker 1: because credit scores are a bit convoluted, as we talked

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Speaker 1: about Matt on the show. They're still massively important, though,

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Speaker 1: even though they're kind of weird. Lenders are less concerned

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Speaker 1: with the fact that you just paid off twenty six

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Speaker 1: dollars in debt. They're not going to look at that

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Speaker 1: and be like that guy, he's good with his money.

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Speaker 1: We're gonna trust to make give them this home loan.

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Speaker 1: That's just they have their their proprietary systems, that's how

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Speaker 1: it works, and they're not factoring in how much debt

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Speaker 1: you've gotten rid of in recent years. It's pretty dumb. Yeah,

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Speaker 1: it is. They're more nervous about your credit score dropping,

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Speaker 1: and they're less enthused by the fact that you just

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Speaker 1: got rid of a bunch of debt, and that, in

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Speaker 1: their mind, actually makes you riskier. The fact that you

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Speaker 1: have a lower score even though you have less debt,

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Speaker 1: which you know, Yeah, like Matt said, it doesn't really

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Speaker 1: make all that much sense. Not how I would have

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Speaker 1: devised the credit scoring model if it were up to me, Yeah,

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Speaker 1: and you can't find some lenders who will actually take

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Speaker 1: that into account, Like they'll do a manual underwriting where

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Speaker 1: they look at all of your information, they'll see what

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Speaker 1: you've been doing, and they'll kind of recognize the good

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Speaker 1: behavior that you have exhibited. Right, But Matt, we we

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Speaker 1: understand your desire to not go back in your credit

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Speaker 1: card debt. Like, we're totally there with you. You You know,

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Speaker 1: credit cards are, like we think, the best method for spending,

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Speaker 1: but only if you use them properly, if you avoid

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Speaker 1: maintaining balances. Uh and uh, you know, if you don't

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Speaker 1: let your spending get out of control. But your instinct

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Speaker 1: you know, to hide the card maybe and provide some

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Speaker 1: behavioral barriers to using it, Like we we feel that

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Speaker 1: as spot on. And so you know, we've talked about

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Speaker 1: this before in the show. But literally putting your credit

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Speaker 1: card on ice, you know, by putting it in a

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Speaker 1: zip block bag full of water, can help prevent some

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Speaker 1: destructive usage of that credit card. Also, too, there's more practical,

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Speaker 1: maybe digital steps that you can also take by you know,

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Speaker 1: doing something as simple as deleting your credit card information

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Speaker 1: from from sites that you regularly use, you know, or

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Speaker 1: deleting it from auto fill within your browser, basically any

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Speaker 1: steps that make it more difficult for you just to

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Speaker 1: hop on somewhere and make it purchase digitally. Yeah, and

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Speaker 1: I think it's too man. It's worth including your partner

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Speaker 1: in this. Right, you mentioned Matt that you're saving up

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Speaker 1: for a down payment with your partner. We'll see if

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Speaker 1: you can enlist the help of your significant other to

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Speaker 1: help keep you on track. Also, if you're lucky, your

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Speaker 1: partner is more of the money nerd, and if so,

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Speaker 1: you have some built in accountability there. And even if

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Speaker 1: it turns out that you're the money nerd who likes

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Speaker 1: to spend, you can use your credit card for maybe

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Speaker 1: like one or two recurring purchases like a power bill,

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Speaker 1: and set them to out o pay. That way, the

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Speaker 1: credit card remains active and helps your credit score. Even

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Speaker 1: if you literally have like stowed it away inside the freezer,

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Speaker 1: making it inaccessible to use on a day to day basis,

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Speaker 1: it's still gonna be helping you out, and that's what

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Speaker 1: you really want. It's not necessarily that you have to

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Speaker 1: use your credit card for everything that you purchase, but

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Speaker 1: it is having that credit card active using it regularly. Uh,

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Speaker 1: even if it means you're not actually physically using it yourself. Yeah,

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Speaker 1: just like the picture of the credit card in the

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Speaker 1: bag of ice sitting there next to the audi ice cream,

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Speaker 1: still doing its work even though you don't have to

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Speaker 1: touch it. It's so good. Uh, it's a matt You know,

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Speaker 1: it's crucial for your credit score to recover before you

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Speaker 1: purchase a home. You know, like this could mean quite

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Speaker 1: a big difference in the rate that you qualify for

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Speaker 1: as well as your your monthly payment. And so keep

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Speaker 1: an eye on your credit score and make changes based

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Speaker 1: on what you see. And you can do this at

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Speaker 1: a site like credit carma dot com. Oftentimes different you know,

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Speaker 1: the different credit card companies online, when you log into

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Speaker 1: the dashboards will have a little link there where you

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Speaker 1: can see your credit score. There in credit CARDA specifically

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Speaker 1: has this helpful score cards section that gives you a

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Speaker 1: peek into what is specifically hurting your score. This is

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Speaker 1: really important, but at the same time, we don't want

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Speaker 1: you to stress out. You mentioned how this is a

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Speaker 1: move that you want to make. Probably within the year,

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Speaker 1: you can rebuild your credit score, you know, forty points

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Speaker 1: by you know, you took to twenty point Ding's that's

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Speaker 1: that's not great. But at the same time, you should

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Speaker 1: totally be able to build that up when the time

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Speaker 1: comes for you to sign up for a mortgage. Yeah,

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Speaker 1: Matt's gonna get there. He's on his way. Just a

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Speaker 1: couple of these tweaks to how you're handling those credit cards, Matt,

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Speaker 1: and you got this. You got it licked, and you're

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Speaker 1: gonna be able to get that mortgage. You're gonna get

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Speaker 1: a great rate. I've got all the faith in you, man.

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Speaker 1: All right, man, let's get to the next question. This

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Speaker 1: one comes from listener Corey, and he wants to know

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Speaker 1: where should he put money that he's investing for retirement.

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Speaker 1: Should it keep going in four one k or is

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Speaker 1: there a better move he can make? Joelan Matt love

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Speaker 1: your podcast, Love all the information you guys are providing

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Speaker 1: to make us all a little bit better financially. My

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Speaker 1: question is regarding retirement accounts and where best to put

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Speaker 1: your money. Currently, I work for employer that provides a

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Speaker 1: four percent match when you can I contribute even to

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Speaker 1: my company, and I'm trying to pick up every dollar

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Speaker 1: I can for retirement. I started thinking about this when

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Speaker 1: listening to you guys about where best to put my money.

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Speaker 1: My question is is it better to pick up the

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Speaker 1: match at your employer's plan and then put additional money

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Speaker 1: into a roth Ira and espousal ira until they're maxed

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Speaker 1: out and then go back to your employer's plan, or

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Speaker 1: is it better to just contribute to in your employer's

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Speaker 1: plan four oh one K plan, that is, until you

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Speaker 1: max that out at the limit, and then if you

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Speaker 1: can put additional money into a roth Ira or spousal ira.

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Speaker 1: I should note that my company does provide an hs

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Speaker 1: A plan which I do contribute to. I'm just determining

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Speaker 1: where best to put my money whether it be in

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Speaker 1: the roth ira accounts or in the rath pour oh

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Speaker 1: one k accounts with the company after a meet the

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Speaker 1: five percent match. Really appreciate your input, look forward to

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Speaker 1: your response, and I definitely look forward to future podcasts

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Speaker 1: and wish you guys continued success and all you guys

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Speaker 1: are doing. Thank you so much, Corey, thanks so much

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Speaker 1: for those well wishes, and we are glad that the

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Speaker 1: information on here on the show has been helpful for

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Speaker 1: you and your money. Let's go ahead and dive in.

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Speaker 1: Let's start with the the kind of the most basic

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Speaker 1: thing here. Let's talk about your match, right, it should

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Speaker 1: continue to be your goal to to get that employer match.

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Speaker 1: Since you're putting in eleven with the four percent match,

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Speaker 1: you're investing of your pay. That is awesome, that's so good.

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Speaker 1: But you know, if you can't do all of that,

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Speaker 1: I think for some it might be be tough to

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Speaker 1: say that much of their income dial back that four

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Speaker 1: win K to full match status only for the time being,

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Speaker 1: bringing your contributions down to five percent of your pay

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Speaker 1: to get that full match first. That'll be worth it

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Speaker 1: because at that point then you can invest in some

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Speaker 1: even more tax advantage ways that we're going to now

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Speaker 1: get to. Yeah, like the h s A. Right, Corey

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Speaker 1: mentioned that he's got an h s A and it

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Speaker 1: just slid it in there. Maybe I should just like

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Speaker 1: let you guys know that I have this and Corey,

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Speaker 1: that is you know a place we would encourage you

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Speaker 1: to invest more of your money. So with those extra funds,

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Speaker 1: as you pull back your four O one K contributions,

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Speaker 1: put that money straight into your h s A instead

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Speaker 1: and seek to max it out if you can. If

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Speaker 1: you file taxes married filing jointly. The max you can

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Speaker 1: put in in a year is sevucks. That's a that's

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Speaker 1: a chunk of change, right, Matt, that you can start

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Speaker 1: investing for the future. So hs as really are best

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Speaker 1: if you use them as long term investment vehicles. A

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Speaker 1: lot of people use these as a way to put

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Speaker 1: money aside and then pay for medical expenses in that year,

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Speaker 1: the very year that you put the money in. And

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Speaker 1: you know, that's which makes sense because it's called a

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Speaker 1: health saving his account. It's like, oh, this is for

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Speaker 1: my health, right, but let's let's let's talk about your

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Speaker 1: health down the road. We if you're listening to this show,

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Speaker 1: you should think about it more of like a health

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Speaker 1: investment account, right, you know, and because that's what it's

430
00:19:57,119 --> 00:20:00,480
Speaker 1: really best at doing because of the way it's treated

431
00:20:00,520 --> 00:20:02,639
Speaker 1: when it comes to taxes. So we would suggest that

432
00:20:02,680 --> 00:20:05,320
Speaker 1: you check out your investment options that are available to

433
00:20:05,400 --> 00:20:08,639
Speaker 1: you inside of that employer hs A plan, because if

434
00:20:08,640 --> 00:20:11,600
Speaker 1: you can invest that money, letting it compound tax for

435
00:20:11,680 --> 00:20:13,679
Speaker 1: you for decades, it's gonna be huge for you. And

436
00:20:13,680 --> 00:20:15,479
Speaker 1: if you want to know more about the h s A,

437
00:20:15,480 --> 00:20:17,080
Speaker 1: Matt and I we did a deep dive back in

438
00:20:17,119 --> 00:20:20,400
Speaker 1: episode one oh five. There are just so many advantages

439
00:20:20,720 --> 00:20:23,600
Speaker 1: to putting more of your investment dollars there as opposed

440
00:20:23,600 --> 00:20:26,600
Speaker 1: to keeping them directly funneled into your four owe k instead. Yeah,

441
00:20:26,600 --> 00:20:28,280
Speaker 1: and Corey he kind of mentioned there towards the end

442
00:20:28,359 --> 00:20:30,080
Speaker 1: how his four O one k is actually a wrath

443
00:20:30,119 --> 00:20:32,200
Speaker 1: for oh one k. And so sometimes, you know, we

444
00:20:32,240 --> 00:20:35,560
Speaker 1: advise for folks to kind of diversify their tax liability,

445
00:20:35,600 --> 00:20:38,800
Speaker 1: like it kind of makes sense from a diversification standpoints

446
00:20:38,800 --> 00:20:41,840
Speaker 1: to say, all right, I'm gonna make some some pre

447
00:20:41,960 --> 00:20:45,600
Speaker 1: tax investments. Now I'm almso gonna make some post tax investments.

448
00:20:45,640 --> 00:20:47,520
Speaker 1: And so basically you have some funds in the future

449
00:20:47,880 --> 00:20:50,240
Speaker 1: that you'll need to pay taxes on because you took

450
00:20:50,240 --> 00:20:53,040
Speaker 1: the tax break earlier. But then you've also got the

451
00:20:53,040 --> 00:20:55,880
Speaker 1: flip side because we don't exactly know where tax rates

452
00:20:55,880 --> 00:20:58,320
Speaker 1: are going to be in the future. However, all that

453
00:20:58,440 --> 00:21:01,880
Speaker 1: being said, tax rates are at historical lows, and so

454
00:21:02,000 --> 00:21:03,920
Speaker 1: because of that, even though you have a roth floor

455
00:21:03,960 --> 00:21:06,600
Speaker 1: one k going on, I think we're still gonna point

456
00:21:06,600 --> 00:21:08,840
Speaker 1: you in the direction of not a traditional ira, but

457
00:21:08,880 --> 00:21:11,000
Speaker 1: a roth ira, right, and so we feel that this

458
00:21:11,080 --> 00:21:15,159
Speaker 1: is uh the next best bet after the h s A. Obviously,

459
00:21:15,240 --> 00:21:17,760
Speaker 1: you know the max annual contribution there's six thousand dollars

460
00:21:17,800 --> 00:21:20,800
Speaker 1: each for for both of you, for you and your spouse,

461
00:21:21,240 --> 00:21:23,879
Speaker 1: and if you fully fund that, then you can go

462
00:21:23,920 --> 00:21:26,720
Speaker 1: back and increase your four one K contributions up to

463
00:21:26,800 --> 00:21:30,680
Speaker 1: the annual limit of nine. Getting to the point where

464
00:21:30,720 --> 00:21:33,360
Speaker 1: you can do all of the above. It's a steep climb,

465
00:21:33,840 --> 00:21:35,479
Speaker 1: but going in this order, we we feel that this

466
00:21:35,520 --> 00:21:38,359
Speaker 1: makes the most sense from our perspective. And yeah, Corey,

467
00:21:38,400 --> 00:21:40,359
Speaker 1: we wish you the best. You've got kind of like

468
00:21:40,400 --> 00:21:43,280
Speaker 1: an audacious investing plan laid out before you, but it

469
00:21:43,280 --> 00:21:45,160
Speaker 1: sounds like you're on the right track. Yeah, it's really

470
00:21:45,160 --> 00:21:48,080
Speaker 1: hard to do and all of the above investing strategy

471
00:21:48,160 --> 00:21:50,760
Speaker 1: like backing out all those accounts and that and then

472
00:21:50,800 --> 00:21:52,480
Speaker 1: this and then after that do this. That's really a

473
00:21:52,560 --> 00:21:54,560
Speaker 1: high bar, you know, to be setting for yourself. Not

474
00:21:54,640 --> 00:21:56,359
Speaker 1: too high for how the money listeners. Yeah, I think

475
00:21:56,359 --> 00:21:57,880
Speaker 1: a lot of how the money listeners, so they are

476
00:21:58,000 --> 00:22:00,280
Speaker 1: looking to, you know, go that extra mile when it

477
00:22:00,280 --> 00:22:03,600
Speaker 1: comes to their investments. And if you can doing all

478
00:22:03,640 --> 00:22:05,840
Speaker 1: of the above, you can get the match contribute in

479
00:22:05,920 --> 00:22:08,080
Speaker 1: max out in h s A and then max out ross.

480
00:22:08,240 --> 00:22:11,080
Speaker 1: I mean that's that's huge. You're like, well on your

481
00:22:11,080 --> 00:22:13,639
Speaker 1: way to financial independence if you are taking that you

482
00:22:13,640 --> 00:22:16,040
Speaker 1: know all the above strategy. Seriously, Corey, keep up the

483
00:22:16,040 --> 00:22:17,959
Speaker 1: good work man, keep making it happen. Are We got

484
00:22:17,960 --> 00:22:20,160
Speaker 1: a couple more questions we want to get to, including

485
00:22:20,200 --> 00:22:23,040
Speaker 1: can you avoid capital gains taxes when selling at home?

486
00:22:23,080 --> 00:22:25,240
Speaker 1: We'll get to that and more right after this break.

487
00:22:35,040 --> 00:22:37,800
Speaker 1: All right, now, it's time for that question about capital

488
00:22:37,840 --> 00:22:42,040
Speaker 1: gains and specifically, uh, this involves some real estate. Hey,

489
00:22:42,040 --> 00:22:45,040
Speaker 1: Matt Angel, this is Marie from Utah. I found you

490
00:22:45,040 --> 00:22:46,639
Speaker 1: guys back into That's the nine Team when I was

491
00:22:46,680 --> 00:22:49,960
Speaker 1: looking to best within my TSP and I've been hooked

492
00:22:49,960 --> 00:22:53,119
Speaker 1: ever since. So this is a little bit involved. About

493
00:22:53,160 --> 00:22:55,440
Speaker 1: four years ago, we sold are almost fully paid off

494
00:22:55,480 --> 00:22:57,520
Speaker 1: investment property a little bit of a loss so that

495
00:22:57,560 --> 00:23:00,480
Speaker 1: we could buy my brother in laws proper that is

496
00:23:00,600 --> 00:23:03,400
Speaker 1: next door to our current home while he was going

497
00:23:03,440 --> 00:23:06,040
Speaker 1: through a divorce. He's been renting it from us, but

498
00:23:06,080 --> 00:23:08,320
Speaker 1: would now like to buy it back. We bought it

499
00:23:08,400 --> 00:23:11,399
Speaker 1: for around two hundred and fifty it's now worth around

500
00:23:11,400 --> 00:23:14,240
Speaker 1: four hundred thousand. We owe a hundred and fifty five

501
00:23:14,280 --> 00:23:16,960
Speaker 1: thousand on it, and we've been depreciating it every year

502
00:23:17,000 --> 00:23:20,199
Speaker 1: for around eight thousand, three hundred. We aren't looking to

503
00:23:20,280 --> 00:23:22,359
Speaker 1: invest in another rental property at this time because of

504
00:23:22,400 --> 00:23:25,080
Speaker 1: how the market values have increased, and honestly, nothing would

505
00:23:25,080 --> 00:23:28,439
Speaker 1: be as great as having a property next door, so

506
00:23:28,920 --> 00:23:32,720
Speaker 1: we still want to minimize capital gains as much as possible.

507
00:23:32,800 --> 00:23:36,560
Speaker 1: Our current ideas are to max are two traditional TSPs

508
00:23:36,840 --> 00:23:39,439
Speaker 1: as much as we can, to max the traditional IRA,

509
00:23:40,040 --> 00:23:43,000
Speaker 1: and to donate some We are kind of stumped on

510
00:23:43,040 --> 00:23:45,119
Speaker 1: what else to do. We also aren't really sure what

511
00:23:45,160 --> 00:23:47,679
Speaker 1: else to do with the rest of the proceeds. Since

512
00:23:47,760 --> 00:23:50,399
Speaker 1: we do have a fully funded emergency fund, we'd be

513
00:23:50,480 --> 00:23:54,399
Speaker 1: maxing our retirement funds, and the only other debt we

514
00:23:54,480 --> 00:23:57,960
Speaker 1: have is our own mortgage, which we will be refinancing

515
00:23:58,040 --> 00:24:02,280
Speaker 1: at a two point three seven five Any ideas would

516
00:24:02,320 --> 00:24:05,919
Speaker 1: be awesome. Thanks Marie, Thanks for your question. Man, I

517
00:24:05,960 --> 00:24:08,680
Speaker 1: just have to say before we get into answering Marie's question,

518
00:24:09,119 --> 00:24:10,960
Speaker 1: I feel like our listeners are crushing it. I feel

519
00:24:11,000 --> 00:24:14,359
Speaker 1: like every question today is coming from a position of

520
00:24:14,400 --> 00:24:17,800
Speaker 1: strength financially. People are in a good position, They've invested well,

521
00:24:17,960 --> 00:24:21,600
Speaker 1: They're trying to maximize their opportunities make smart decisions, but

522
00:24:21,720 --> 00:24:24,640
Speaker 1: It's just it's cool to hear how our listeners are

523
00:24:24,640 --> 00:24:26,360
Speaker 1: just like taking the bull by the horns and they're

524
00:24:26,359 --> 00:24:28,760
Speaker 1: doing a great job with their money. And Marie included

525
00:24:28,800 --> 00:24:31,959
Speaker 1: like this is a question that's coming from a position

526
00:24:31,960 --> 00:24:34,119
Speaker 1: of strength, like how do I potentially avoid some of

527
00:24:34,119 --> 00:24:38,400
Speaker 1: the tax on the massive amount of money I made? Right? Mostuff? Yeah,

528
00:24:38,400 --> 00:24:40,439
Speaker 1: I mean taking it back to like Natalie's question earlier,

529
00:24:40,440 --> 00:24:42,160
Speaker 1: this is kind of like a five thousand level ask

530
00:24:42,240 --> 00:24:45,440
Speaker 1: how the money episode? These are all very advanced questions

531
00:24:45,640 --> 00:24:48,119
Speaker 1: where folks are doing an amazing job with their money.

532
00:24:48,160 --> 00:24:50,760
Speaker 1: So that, yeah, definitely makes me really happy. And Marie,

533
00:24:50,800 --> 00:24:52,360
Speaker 1: you know, first of all too, I'm glad that you're

534
00:24:52,359 --> 00:24:54,639
Speaker 1: not asking us like what the fair price should be

535
00:24:54,840 --> 00:24:56,760
Speaker 1: to sell that house back to your brother in law,

536
00:24:57,280 --> 00:25:00,200
Speaker 1: because I feel that mixing family and money to other

537
00:25:00,280 --> 00:25:02,320
Speaker 1: can kind of be you know, some tricky waters to

538
00:25:02,400 --> 00:25:05,280
Speaker 1: wait into, and especially in your case, if you haven't

539
00:25:05,480 --> 00:25:08,400
Speaker 1: you know, addressed the possibility of him buying the home

540
00:25:08,480 --> 00:25:10,120
Speaker 1: back from 'all you know, back when he was going

541
00:25:10,160 --> 00:25:12,359
Speaker 1: through the through that divorce, this could lead to some

542
00:25:12,359 --> 00:25:15,520
Speaker 1: difficult conversations. But yeah, again you're not asking about that.

543
00:25:15,560 --> 00:25:17,639
Speaker 1: Part of it sounds like you've identified the price and

544
00:25:17,920 --> 00:25:19,800
Speaker 1: you're just moving on. There we go. I don't want

545
00:25:19,800 --> 00:25:22,360
Speaker 1: to get into that. But let's talk about taxes. Everyone's

546
00:25:22,400 --> 00:25:25,400
Speaker 1: other favorite topic. You know, people love to talk about.

547
00:25:25,400 --> 00:25:28,439
Speaker 1: Taxes is just like an enjoyable, enlightening conversation for all

548
00:25:28,480 --> 00:25:32,640
Speaker 1: of us, really light light table talking exactly. It's everybody excited.

549
00:25:33,000 --> 00:25:36,160
Speaker 1: Let's let's talk about religion, politics and taxes like those

550
00:25:36,200 --> 00:25:40,480
Speaker 1: are really fun topics of dinner conversation. But I will say, Marie,

551
00:25:40,720 --> 00:25:43,800
Speaker 1: taxes are in most cases a sign of success, right

552
00:25:43,840 --> 00:25:46,000
Speaker 1: that the better that you do, the more you'll owe.

553
00:25:46,320 --> 00:25:48,240
Speaker 1: And you've done really well with this property, so you're

554
00:25:48,240 --> 00:25:51,119
Speaker 1: gonna owe tax on it. But fortunately you'll owe taxes

555
00:25:51,160 --> 00:25:53,760
Speaker 1: on the gain of this property at the capital gains rate,

556
00:25:53,760 --> 00:25:58,359
Speaker 1: which is really favorable. It's fiftent in most cases. The

557
00:25:58,400 --> 00:26:01,199
Speaker 1: only way to avoid capital game gains, ever, is to

558
00:26:01,240 --> 00:26:03,160
Speaker 1: sell an asset in a year in which you made

559
00:26:03,240 --> 00:26:06,400
Speaker 1: less than eighty thousand dollars including that gain. Uh So

560
00:26:06,560 --> 00:26:08,600
Speaker 1: that means that Marie, you're not going to be eligible

561
00:26:08,920 --> 00:26:11,720
Speaker 1: to skip out on any sort of capital gains tax um.

562
00:26:11,760 --> 00:26:14,760
Speaker 1: That's the threshold for a zero percent capital gains tax rate.

563
00:26:15,000 --> 00:26:16,640
Speaker 1: But of course, since your capital gains are so high

564
00:26:16,680 --> 00:26:19,520
Speaker 1: on this property, that's impossible that sale price in accompanying

565
00:26:19,600 --> 00:26:21,720
Speaker 1: gain alone will push your A G I pass the

566
00:26:21,760 --> 00:26:25,080
Speaker 1: point of being able to avoid paying it. So sorry,

567
00:26:25,080 --> 00:26:27,120
Speaker 1: but it is kind of a success tax in a way.

568
00:26:27,320 --> 00:26:29,639
Speaker 1: You've been successful and you are going to owe uh

569
00:26:29,800 --> 00:26:31,960
Speaker 1: taxes at the rate of fifteen percent in all likelihood

570
00:26:32,000 --> 00:26:34,320
Speaker 1: on the games of this property. That's right. And you

571
00:26:34,320 --> 00:26:36,480
Speaker 1: know the only way for most real estate investors to

572
00:26:36,880 --> 00:26:40,160
Speaker 1: avoid capital gains taxes is either to to gain very little,

573
00:26:40,320 --> 00:26:43,399
Speaker 1: which isn't a great game plan, let me hamstring myself,

574
00:26:45,000 --> 00:26:48,080
Speaker 1: or order to roll that money into another property. And Marie,

575
00:26:48,080 --> 00:26:50,040
Speaker 1: you touched on this, and so this is called the

576
00:26:50,080 --> 00:26:52,440
Speaker 1: ten thirty one exchange for everyone else out there, it's

577
00:26:52,560 --> 00:26:54,760
Speaker 1: it's listed under section ten thirty one and the I

578
00:26:54,840 --> 00:26:57,320
Speaker 1: R S Code. That's why it's called the one exchange.

579
00:26:57,400 --> 00:27:01,080
Speaker 1: IRS has all these catchy names, so sexy, and it's

580
00:27:01,080 --> 00:27:03,600
Speaker 1: an excellent strategy that would allow you to minimize your

581
00:27:03,600 --> 00:27:06,359
Speaker 1: capital gains taxes that you were to pay. Again, so

582
00:27:06,560 --> 00:27:09,120
Speaker 1: we know that you said you're not interested in real estate,

583
00:27:09,680 --> 00:27:11,919
Speaker 1: as you had it pretty nice with that house next door.

584
00:27:12,160 --> 00:27:14,960
Speaker 1: But if you're looking to minimize taxes, we would highly

585
00:27:14,960 --> 00:27:17,639
Speaker 1: recommend you consider a ten thirty one exchange, you know,

586
00:27:17,640 --> 00:27:20,280
Speaker 1: like maybe sit down and consider what is it about

587
00:27:20,320 --> 00:27:23,200
Speaker 1: having rental real estate that maybe you dislike the most.

588
00:27:23,320 --> 00:27:26,120
Speaker 1: You don't like, say, for instance, if it's repairs and maintenance,

589
00:27:26,240 --> 00:27:29,399
Speaker 1: like maybe for you, hiring a property manager makes the

590
00:27:29,400 --> 00:27:31,720
Speaker 1: most sense. You talked about how having it next door was,

591
00:27:31,880 --> 00:27:34,280
Speaker 1: you know, really nice, and so I'm guessing what that

592
00:27:34,320 --> 00:27:36,080
Speaker 1: meant is that it was really nice to be able

593
00:27:36,080 --> 00:27:37,920
Speaker 1: to go over there and make a repair or to

594
00:27:38,000 --> 00:27:40,040
Speaker 1: check on something like that. And so if you're just

595
00:27:40,119 --> 00:27:41,600
Speaker 1: not wanting it to be a part of your life

596
00:27:41,640 --> 00:27:43,760
Speaker 1: as much, I could see that being a good instance

597
00:27:43,800 --> 00:27:46,120
Speaker 1: for when you might want to hire a manager. Yes,

598
00:27:46,160 --> 00:27:48,040
Speaker 1: you're paying them a percentage, but it would it be

599
00:27:49,040 --> 00:27:51,600
Speaker 1: of the gains that you would realize from selling that

600
00:27:51,600 --> 00:27:56,280
Speaker 1: property next door. That would be one really expensive property, right, Um,

601
00:27:56,359 --> 00:27:59,480
Speaker 1: And yeah, I agree, Marie. I think it's worth considering

602
00:27:59,520 --> 00:28:01,320
Speaker 1: doing a tent already want to change hiring a property

603
00:28:01,320 --> 00:28:04,199
Speaker 1: manager so that you're not overseeing the rental property if

604
00:28:04,240 --> 00:28:06,920
Speaker 1: that's what makes it daunting and uninteresting to you, It's

605
00:28:06,960 --> 00:28:08,920
Speaker 1: really the only way to avoid the massive tax bill

606
00:28:08,960 --> 00:28:11,080
Speaker 1: that you're gonna face when you sell this property. By

607
00:28:11,119 --> 00:28:12,520
Speaker 1: the way, for everyone else out there, mat, I think

608
00:28:12,560 --> 00:28:14,960
Speaker 1: it's important to clarify, Uh, this is the way it

609
00:28:14,960 --> 00:28:17,760
Speaker 1: works when you're profiting from an investment property, not a

610
00:28:17,840 --> 00:28:21,120
Speaker 1: primary residence. Taxes are way more favorable when you're selling

611
00:28:21,119 --> 00:28:23,960
Speaker 1: your primary residence, and most normal folks aren't gonna owe

612
00:28:23,960 --> 00:28:26,679
Speaker 1: anything in taxes when selling their home. And another option,

613
00:28:26,720 --> 00:28:29,159
Speaker 1: by the way, worth considering for Marie is that if

614
00:28:29,200 --> 00:28:31,800
Speaker 1: you created a company like an LLC, maybe you call

615
00:28:31,840 --> 00:28:34,640
Speaker 1: it Marie's Holdings LLC. Like that, Yeah, fancy rate to it.

616
00:28:34,640 --> 00:28:37,080
Speaker 1: It's better than the I R S name of one exchange,

617
00:28:37,400 --> 00:28:41,760
Speaker 1: just as straightforward though, right, yes it is. Uh. Well then,

618
00:28:42,040 --> 00:28:44,480
Speaker 1: and then if that LLC owned the property and sold

619
00:28:44,480 --> 00:28:46,960
Speaker 1: the property, you might be eligible to open up a

620
00:28:47,120 --> 00:28:50,360
Speaker 1: set bi ra so the company contributes to a retirement

621
00:28:50,360 --> 00:28:53,440
Speaker 1: fund on your behalf up to fifty seven thousand dollars

622
00:28:53,560 --> 00:28:57,600
Speaker 1: for last year fifty eight thousand dollars one. It's definitely

623
00:28:57,600 --> 00:29:00,160
Speaker 1: worth considering, but we would suggest that you talk to

624
00:29:00,160 --> 00:29:02,840
Speaker 1: a tax professional before you know, pulling off a complex

625
00:29:02,880 --> 00:29:05,000
Speaker 1: maneuver like that. That's right, Yeah, So Marie, thank you

626
00:29:05,040 --> 00:29:06,640
Speaker 1: so much for that question. We hope we have gotten

627
00:29:06,680 --> 00:29:08,880
Speaker 1: you pointed in the right direction, and at least I've

628
00:29:08,920 --> 00:29:11,920
Speaker 1: given you maybe a couple other ideas to consider, all right, Jill,

629
00:29:11,960 --> 00:29:13,880
Speaker 1: Our next question comes from a listener who is looking

630
00:29:13,920 --> 00:29:18,120
Speaker 1: to basically maximize her savings. Let's hear it. Hey, Jela Matte,

631
00:29:18,160 --> 00:29:20,640
Speaker 1: my name is Brittany. I live in southern Illinois, about

632
00:29:20,800 --> 00:29:23,760
Speaker 1: thirty minutes east of St. Louis. I absolutely love you

633
00:29:23,840 --> 00:29:27,080
Speaker 1: guys podcast, and I listened to it religiously. I have

634
00:29:27,200 --> 00:29:30,520
Speaker 1: a question about maximizing savings, and I like your input

635
00:29:30,560 --> 00:29:35,680
Speaker 1: on mainly about mutual funds versus like a high interest savings.

636
00:29:36,640 --> 00:29:39,280
Speaker 1: My husband and I currently have four one case and

637
00:29:39,320 --> 00:29:43,800
Speaker 1: pensions through a work that we save about our income on.

638
00:29:44,400 --> 00:29:47,080
Speaker 1: We also have about six months worth of savings saved

639
00:29:47,160 --> 00:29:50,400
Speaker 1: up in UH savings account in our bank, and we

640
00:29:50,520 --> 00:29:55,280
Speaker 1: also have like a fun money account for vacationing and

641
00:29:55,320 --> 00:29:58,600
Speaker 1: that kind of thing. But I was wanting to try

642
00:29:58,680 --> 00:30:00,280
Speaker 1: to see if there was anything we could due to

643
00:30:00,320 --> 00:30:03,320
Speaker 1: get more bang for your buck, so to speak, help

644
00:30:03,440 --> 00:30:06,640
Speaker 1: maximize the savings. As I said, any input that you

645
00:30:06,680 --> 00:30:10,080
Speaker 1: can give would be greatly appreciate it. Thank you so much. Brittany,

646
00:30:10,080 --> 00:30:11,960
Speaker 1: thanks for that beer recommendation. Of course, Matt and I

647
00:30:12,040 --> 00:30:14,800
Speaker 1: always up for a good, solid beer recommendation. I think

648
00:30:14,800 --> 00:30:16,680
Speaker 1: we've actually had a four hands beer on the show

649
00:30:16,720 --> 00:30:18,680
Speaker 1: back in the day. It's been a minute, it has,

650
00:30:18,920 --> 00:30:20,920
Speaker 1: But yeah. St. Louis has some has some good beers,

651
00:30:20,960 --> 00:30:23,680
Speaker 1: has some great breweries. We've had side project before. A

652
00:30:23,680 --> 00:30:26,200
Speaker 1: couple of weeks ago, we had something from Perennial Artisan

653
00:30:26,280 --> 00:30:29,120
Speaker 1: Nails on the on the show. What it's called. It

654
00:30:29,160 --> 00:30:32,360
Speaker 1: was delicious. Yeah, actually kind of similar to this beer. Yes, yeah,

655
00:30:32,360 --> 00:30:34,080
Speaker 1: that's true. We'll talk about here on this episode. Yeah,

656
00:30:34,120 --> 00:30:36,719
Speaker 1: but but we hear you, Brittany. Nobody is getting much

657
00:30:36,760 --> 00:30:38,800
Speaker 1: bang for their buck these days when it comes to savings.

658
00:30:39,040 --> 00:30:40,960
Speaker 1: So let's get to your question. The fact that you

659
00:30:41,000 --> 00:30:43,880
Speaker 1: have a fully funded emergency fund is awesome. And on

660
00:30:43,960 --> 00:30:46,640
Speaker 1: top of that, you have additional savings buckets for other

661
00:30:46,680 --> 00:30:48,959
Speaker 1: goals that you're calling fun money. Let that put you

662
00:30:49,000 --> 00:30:51,880
Speaker 1: in just an awesome spot. Financially, You're you're essentially the

663
00:30:51,920 --> 00:30:54,880
Speaker 1: opposite of someone living paycheck to paycheck, right, um, And

664
00:30:55,000 --> 00:30:57,640
Speaker 1: so yeah, congratulations are in order, Brittany. You're doing a

665
00:30:57,640 --> 00:30:59,880
Speaker 1: great job. We feel your pain, though of wishing that

666
00:31:00,040 --> 00:31:02,000
Speaker 1: your money was earning a higher rate of return. But

667
00:31:02,040 --> 00:31:04,640
Speaker 1: it's important to remind yourself what this money is for.

668
00:31:05,080 --> 00:31:08,360
Speaker 1: It's not to grow your wealth. It's there to preserve it.

669
00:31:08,400 --> 00:31:11,360
Speaker 1: That's what savings are for. So that money is sitting there, safe,

670
00:31:11,360 --> 00:31:14,680
Speaker 1: insecure in case something comes up, and those savings are

671
00:31:14,680 --> 00:31:16,880
Speaker 1: going to keep you from racking up credit card tent

672
00:31:17,280 --> 00:31:21,040
Speaker 1: if something were to happen that was unforeseen. Yeah, and Brittany,

673
00:31:21,160 --> 00:31:24,120
Speaker 1: y'all are serious investors, which is great as well, but

674
00:31:24,200 --> 00:31:26,640
Speaker 1: you know, having that emergency fund sitting there as cash

675
00:31:27,040 --> 00:31:30,240
Speaker 1: will also keep you from potentially tapping those retirement accounts

676
00:31:30,240 --> 00:31:32,920
Speaker 1: which come with a hefty fee as well. That's something

677
00:31:32,960 --> 00:31:35,520
Speaker 1: that we were able to avoid last year with the

678
00:31:35,600 --> 00:31:37,760
Speaker 1: care Is Act, right, the ability to tap into some

679
00:31:37,800 --> 00:31:41,400
Speaker 1: four own case some retirement plans without that additional ten percent.

680
00:31:42,160 --> 00:31:43,840
Speaker 1: But that's something that you want to keep in mind

681
00:31:43,840 --> 00:31:46,960
Speaker 1: as well. So that being said, don't invest your emergency

682
00:31:46,960 --> 00:31:49,600
Speaker 1: fund or your fund money, keep it liquid as cash.

683
00:31:49,760 --> 00:31:52,000
Speaker 1: But you know, we definitely recommend you to look around

684
00:31:52,080 --> 00:31:55,400
Speaker 1: to the different online high interest savings accounts that are

685
00:31:55,440 --> 00:31:58,040
Speaker 1: out there. As of this recordings, c I T and

686
00:31:58,120 --> 00:32:02,320
Speaker 1: ALLY are both offering point five percent on their savings accounts. Uh.

687
00:32:02,360 --> 00:32:05,000
Speaker 1: And be sure to check out Allies No Penalty c

688
00:32:05,120 --> 00:32:08,040
Speaker 1: D as well, even though they're you know, also just

689
00:32:08,080 --> 00:32:10,600
Speaker 1: paying point five percent there as well. You're able to

690
00:32:10,640 --> 00:32:14,560
Speaker 1: lock in the rate just in case rates drop even more. Uh.

691
00:32:14,600 --> 00:32:17,000
Speaker 1: And of course, since it's penalty free, that means you

692
00:32:17,000 --> 00:32:19,800
Speaker 1: can pull that money out of there really quickly without

693
00:32:19,880 --> 00:32:23,360
Speaker 1: any of those penalties or fees, without getting penalized for

694
00:32:23,480 --> 00:32:25,640
Speaker 1: pulling that money out early. Yeah, Matt, you jumped on

695
00:32:25,640 --> 00:32:27,880
Speaker 1: that early on in the pandemic as rates were falling,

696
00:32:28,160 --> 00:32:30,480
Speaker 1: and you're sitting pretty now in your no penalty c D.

697
00:32:30,600 --> 00:32:32,720
Speaker 1: I mean literally, that was my our emergency fund. I

698
00:32:32,760 --> 00:32:34,120
Speaker 1: was just like, you know what, Like, I don't think

699
00:32:34,160 --> 00:32:37,200
Speaker 1: there is a high chance of us needing this emergency fund,

700
00:32:37,520 --> 00:32:39,680
Speaker 1: but you still want it. They're just in case, but

701
00:32:39,760 --> 00:32:41,960
Speaker 1: you also want access to it, which is why I

702
00:32:41,960 --> 00:32:44,120
Speaker 1: feel like the Yeah, the no penalt d CD makes

703
00:32:44,160 --> 00:32:47,080
Speaker 1: so much sense for that application. Yeah, especially in a

704
00:32:47,080 --> 00:32:49,360
Speaker 1: falling interest rate environment and you're sitting it like three

705
00:32:49,440 --> 00:32:51,920
Speaker 1: quarters of a percent higher than than most people are

706
00:32:51,960 --> 00:32:53,360
Speaker 1: these days. I wish it was like closer to three

707
00:32:53,440 --> 00:32:55,280
Speaker 1: or four percent higher, but it'd be nice. Yeah, not

708
00:32:55,400 --> 00:32:58,440
Speaker 1: the case, right. That was a long time ago. We

709
00:32:58,440 --> 00:33:00,719
Speaker 1: went interest rate. Wen says, an, we're earning that rate

710
00:33:00,720 --> 00:33:03,959
Speaker 1: of interest. Uh, let's talk about two, Matt. Another option

711
00:33:04,000 --> 00:33:07,080
Speaker 1: for Brittany here, Brittany, if you're under the income limits

712
00:33:07,120 --> 00:33:09,560
Speaker 1: a RATH, opening a roth Ira for you and your

713
00:33:09,640 --> 00:33:13,200
Speaker 1: husband is a great and flexible investing vehicle. Combined. That's

714
00:33:13,200 --> 00:33:15,600
Speaker 1: an extra twelve thou dollars that you could be stocking away.

715
00:33:15,840 --> 00:33:18,360
Speaker 1: And the best part of all is that your contributions

716
00:33:18,680 --> 00:33:22,280
Speaker 1: can be withdrawn for any reason without paying any fees

717
00:33:22,360 --> 00:33:26,400
Speaker 1: or taxes because RATH contributions are made with post tax money.

718
00:33:26,560 --> 00:33:28,560
Speaker 1: And so Matt in an episode we did all about

719
00:33:28,680 --> 00:33:31,240
Speaker 1: the roth Ira. That's something we talked about, is that

720
00:33:31,360 --> 00:33:34,080
Speaker 1: the roth Ira has this potential to at least house

721
00:33:34,200 --> 00:33:37,960
Speaker 1: a portion of your emergency fund if you've been diligent

722
00:33:38,080 --> 00:33:39,960
Speaker 1: enough to handle money well throughout the years. And I

723
00:33:40,000 --> 00:33:42,360
Speaker 1: think Brittany can start working towards that. If you do

724
00:33:42,440 --> 00:33:44,760
Speaker 1: look at your cash stockpile and it starts to make

725
00:33:44,760 --> 00:33:47,520
Speaker 1: your heart hurt and you wish that some of it

726
00:33:47,640 --> 00:33:50,040
Speaker 1: was invested, I think you know it's it's it doesn't

727
00:33:50,040 --> 00:33:52,920
Speaker 1: make sense to take all that money and invested, because

728
00:33:52,920 --> 00:33:54,920
Speaker 1: then you're putting yourself at undue risk if something were

729
00:33:54,960 --> 00:33:57,320
Speaker 1: to happen. But opening up a wrath and starting to

730
00:33:57,360 --> 00:33:59,840
Speaker 1: stash money in there and working up to the point

731
00:34:00,120 --> 00:34:02,960
Speaker 1: where the rath can be a small portion of your

732
00:34:02,960 --> 00:34:05,400
Speaker 1: emergency fund is a worthwhile goal, and it can mean

733
00:34:05,440 --> 00:34:07,720
Speaker 1: not having to have quite as much money sitting in

734
00:34:07,760 --> 00:34:10,359
Speaker 1: a savings account the turning just very little, that's right.

735
00:34:10,480 --> 00:34:12,400
Speaker 1: So yeah, Brittany, just keep in mind too. You know,

736
00:34:12,680 --> 00:34:14,920
Speaker 1: this past year, a lot of people went through some

737
00:34:14,920 --> 00:34:17,400
Speaker 1: some difficult situations, right, Like, I've got a feeling that

738
00:34:17,440 --> 00:34:19,719
Speaker 1: you probably did pretty good. It sounds like you'll have

739
00:34:19,760 --> 00:34:23,200
Speaker 1: some really solid and secure jobs. But imagine if you didn't, right,

740
00:34:23,280 --> 00:34:25,800
Speaker 1: Imagine if you would have been in a situation where

741
00:34:26,560 --> 00:34:28,799
Speaker 1: you had to go on unemployment, or in a situation

742
00:34:28,840 --> 00:34:31,720
Speaker 1: where your hours were cut something like that. Hard times

743
00:34:31,719 --> 00:34:34,279
Speaker 1: aren't always foreseeable, and so that is why we want

744
00:34:34,280 --> 00:34:36,840
Speaker 1: to make sure that your emergency fund uh funds that

745
00:34:36,880 --> 00:34:39,520
Speaker 1: you want accessible isn't invested, you know. And the other

746
00:34:39,560 --> 00:34:41,600
Speaker 1: thing too, like you don't want to have money invested

747
00:34:41,680 --> 00:34:44,040
Speaker 1: in the market that you're planning to take out within

748
00:34:44,040 --> 00:34:46,000
Speaker 1: a year or you know, maybe even a couple of years.

749
00:34:46,440 --> 00:34:47,719
Speaker 1: That's the kind of money you want to leave in

750
00:34:47,760 --> 00:34:49,400
Speaker 1: the market for the long term. You want to make

751
00:34:49,440 --> 00:34:52,000
Speaker 1: sure that you're avoiding that volatility, and you avoid that

752
00:34:52,040 --> 00:34:55,960
Speaker 1: by keeping it placed more conservatively, no doubt. So, Brittany,

753
00:34:55,960 --> 00:34:58,319
Speaker 1: best of luck moving forward, and don't feel so bad

754
00:34:58,360 --> 00:35:00,919
Speaker 1: that your money is sitting there in savings not earning

755
00:35:00,920 --> 00:35:03,279
Speaker 1: a lot. That's the boat we're all in. Yeah, it's

756
00:35:03,280 --> 00:35:06,080
Speaker 1: a good thing. Uh and too, Brittany said, she listens religiously.

757
00:35:06,320 --> 00:35:07,600
Speaker 1: I was gonna say, you do kind of have some

758
00:35:07,680 --> 00:35:11,239
Speaker 1: like cult leader like tendencies. Thank you. I appreciate that.

759
00:35:11,239 --> 00:35:13,080
Speaker 1: That's what I was going for it. I pulled it off.

760
00:35:13,800 --> 00:35:16,080
Speaker 1: You do it? Well, okay, thank you? All right. Well

761
00:35:16,120 --> 00:35:18,279
Speaker 1: let's get back to the beer that we had on

762
00:35:18,320 --> 00:35:21,080
Speaker 1: this episode. This one was called Seven Deadly Stouts by

763
00:35:21,120 --> 00:35:24,200
Speaker 1: Monday Night Brewing and Matt. This was a beer that

764
00:35:24,600 --> 00:35:26,880
Speaker 1: literally they took seven different style say brewed, and they

765
00:35:26,880 --> 00:35:29,719
Speaker 1: blended them together to create something unique and epic. What

766
00:35:29,760 --> 00:35:31,719
Speaker 1: were your thoughts on this one? I would say that

767
00:35:31,760 --> 00:35:33,360
Speaker 1: I think this is one of the best beers to

768
00:35:33,400 --> 00:35:36,200
Speaker 1: have come out of Atlanta. Like it. It is that good.

769
00:35:36,320 --> 00:35:38,440
Speaker 1: I mean, the flavor that they've packed into the stout.

770
00:35:38,640 --> 00:35:40,680
Speaker 1: It makes you think that it's going to be crazy thick,

771
00:35:40,840 --> 00:35:42,760
Speaker 1: you know, but like that's like, what's so amazing about

772
00:35:42,760 --> 00:35:45,640
Speaker 1: this is that it doesn't it's not overly heavy. It's

773
00:35:45,719 --> 00:35:47,920
Speaker 1: you know, the mouth feel the body. You drink it

774
00:35:47,960 --> 00:35:49,480
Speaker 1: and you kind of switch it around a little bit,

775
00:35:49,719 --> 00:35:51,920
Speaker 1: and and for the most part, it's pretty light compared

776
00:35:51,960 --> 00:35:54,040
Speaker 1: to a lot of different stouts that would try to

777
00:35:54,080 --> 00:35:56,520
Speaker 1: incorporate this amount of flavor, you know. And so the

778
00:35:56,560 --> 00:35:58,480
Speaker 1: first thing I noted though, was like the vanilla flavor

779
00:35:58,480 --> 00:36:00,000
Speaker 1: going on, like the vanilla, but then it's got like

780
00:36:00,040 --> 00:36:02,640
Speaker 1: the dark chocolate roastiness going on. There's like some nice

781
00:36:02,680 --> 00:36:05,839
Speaker 1: coconut vibes, uh, and there's also like some serious notes

782
00:36:05,880 --> 00:36:07,880
Speaker 1: of hazel nuts. Like as I'm drinking it, like it

783
00:36:08,000 --> 00:36:12,120
Speaker 1: totally made me think of New Tella, but New Teller

784
00:36:12,200 --> 00:36:14,880
Speaker 1: that was also aged in like bourbon and brandy and

785
00:36:14,920 --> 00:36:18,239
Speaker 1: whiskey barrels. Yeah, all the different barrels. But that's kind

786
00:36:18,280 --> 00:36:21,680
Speaker 1: of New Teller really, It's true. But this was an

787
00:36:21,719 --> 00:36:24,719
Speaker 1: amazing beer. I'm I'm kind of shocked that we just

788
00:36:24,760 --> 00:36:26,480
Speaker 1: kind of pulled this one out randomly, but we're just

789
00:36:26,520 --> 00:36:28,040
Speaker 1: like I mean, why not, you know, that's kind of

790
00:36:28,040 --> 00:36:29,719
Speaker 1: the how the moneyway. It's not we're not living for

791
00:36:29,760 --> 00:36:32,080
Speaker 1: the weekends, which is actually kind of like Monday Night's

792
00:36:32,280 --> 00:36:35,359
Speaker 1: motto that weekends are overrated. But like we talked about

793
00:36:35,400 --> 00:36:37,760
Speaker 1: on the show, craft beer is our craft beer equivalent,

794
00:36:37,800 --> 00:36:40,040
Speaker 1: and so being able to enjoy something delicious like this

795
00:36:40,680 --> 00:36:42,520
Speaker 1: during the week man while you and I record an

796
00:36:42,520 --> 00:36:44,440
Speaker 1: episode that we can share a bottle like this is

797
00:36:44,719 --> 00:36:46,279
Speaker 1: is a ton of fun. But yeah, what were your

798
00:36:46,320 --> 00:36:48,279
Speaker 1: specific thoughts on this beer? Well, that was pretty meta

799
00:36:48,360 --> 00:36:51,480
Speaker 1: to say that craft beer is our craft But I

800
00:36:51,480 --> 00:36:53,520
Speaker 1: thought it was interesting, you know, reading up on this beer,

801
00:36:53,640 --> 00:36:55,920
Speaker 1: like it took two and a half years to make

802
00:36:55,960 --> 00:36:57,920
Speaker 1: this beer, and then then one of the things too,

803
00:36:57,920 --> 00:37:00,239
Speaker 1: because it was these different staffs were aged for barious

804
00:37:00,239 --> 00:37:02,719
Speaker 1: amount of times and different barrels, and then it took

805
00:37:02,840 --> 00:37:07,160
Speaker 1: really an expert blender to mix those stouts together to

806
00:37:07,239 --> 00:37:11,320
Speaker 1: create something like that's delicious. Sometimes combining a bunch of

807
00:37:11,400 --> 00:37:13,320
Speaker 1: different beers like that, it might taste like you remember

808
00:37:13,320 --> 00:37:16,520
Speaker 1: when you used to be like a suicide, like on

809
00:37:16,560 --> 00:37:19,640
Speaker 1: the soft drink fountain machine and you get like, you know,

810
00:37:19,719 --> 00:37:21,560
Speaker 1: some sprite, some cokes, some dr pepper, all that stuff

811
00:37:21,560 --> 00:37:23,080
Speaker 1: and it would just it would taste horrible, Right, you

812
00:37:23,080 --> 00:37:25,360
Speaker 1: weren't a good blender. Yeah, I guess not. That's what

813
00:37:25,400 --> 00:37:27,160
Speaker 1: I'm saying is like, you know, drinking each of these

814
00:37:27,160 --> 00:37:30,480
Speaker 1: stouts separately, I'm sure it was good. Typically combining them

815
00:37:30,480 --> 00:37:32,759
Speaker 1: into something it's a really hard task and so it

816
00:37:32,800 --> 00:37:35,600
Speaker 1: really shows that they that they were expert blenders when

817
00:37:35,640 --> 00:37:37,799
Speaker 1: they made this beer. I agree. There were hints of

818
00:37:37,840 --> 00:37:41,040
Speaker 1: all sorts of the ingredients that um we're in those

819
00:37:41,120 --> 00:37:45,160
Speaker 1: base original stouts, like vanilla, like cinnamon, um and and

820
00:37:45,320 --> 00:37:47,200
Speaker 1: coconut and some of the other ones as we definitely

821
00:37:47,239 --> 00:37:49,400
Speaker 1: some cinnamon which brought us back to the Abraxis that

822
00:37:49,440 --> 00:37:52,960
Speaker 1: we had recently. Yes, both both of these beers fantastic.

823
00:37:53,000 --> 00:37:55,480
Speaker 1: I guess if was it Brittany, So she's up there

824
00:37:55,560 --> 00:37:58,360
Speaker 1: and has access maybe to the perennial artist and nails.

825
00:37:58,520 --> 00:37:59,600
Speaker 1: If you can get your hands on some of the

826
00:37:59,600 --> 00:38:02,319
Speaker 1: bractsis Brittany, that is similar to what we're drinking right now,

827
00:38:02,440 --> 00:38:05,600
Speaker 1: if you want to get seriously meato with it. Yeah. Yeah,

828
00:38:05,640 --> 00:38:08,400
Speaker 1: So this beer was excellent, definitely, I agree, one of

829
00:38:08,400 --> 00:38:10,760
Speaker 1: the best beers that's ever come out of Atlanta. Major

830
00:38:10,800 --> 00:38:13,479
Speaker 1: winner from the folks over Monday night brewing and also

831
00:38:13,680 --> 00:38:16,279
Speaker 1: kind of a random splurge on our parts, so it

832
00:38:17,000 --> 00:38:19,759
Speaker 1: was cheers, all right. So that's gonna do it for

833
00:38:19,800 --> 00:38:22,800
Speaker 1: this episode. We look forward to taking more listener questions

834
00:38:22,840 --> 00:38:24,719
Speaker 1: in a couple of weeks, and you can always go

835
00:38:24,840 --> 00:38:27,279
Speaker 1: and submit your listener question to be featured on an

836
00:38:27,360 --> 00:38:30,839
Speaker 1: upcoming ask htm episode. There are simple instructions for how

837
00:38:30,880 --> 00:38:32,640
Speaker 1: you do that on our website at how to money

838
00:38:32,680 --> 00:38:34,719
Speaker 1: dot com slash ask. That's right, and if you've listened

839
00:38:34,719 --> 00:38:36,239
Speaker 1: to our show and you found it helpful, we would

840
00:38:36,280 --> 00:38:40,000
Speaker 1: love for you to share your appreciation for the show

841
00:38:40,040 --> 00:38:42,600
Speaker 1: by heading over to Apple Podcast, leaving us a solid

842
00:38:42,640 --> 00:38:44,799
Speaker 1: review over there that helps us to get the word

843
00:38:44,800 --> 00:38:46,959
Speaker 1: out helps others to make sure that they are doing

844
00:38:47,080 --> 00:38:49,719
Speaker 1: smart things with their money as well. So thanks in

845
00:38:49,800 --> 00:38:53,160
Speaker 1: Advanced for that and Joel. Until next time, Best Friends Out,

846
00:38:53,200 --> 00:38:54,359
Speaker 1: Best Friends Out.