1 00:00:00,080 --> 00:00:03,000 Speaker 1: Welcome to Head of Money. I'm Joel, I am Matt. 2 00:00:03,040 --> 00:00:06,760 Speaker 1: Today we're talking about longer loans, pre paying principle, and 3 00:00:06,880 --> 00:00:28,560 Speaker 1: higher heating bills. That's right, buddy. This is our Friday Flight, 4 00:00:28,680 --> 00:00:31,720 Speaker 1: the weekly round up, our weekly roundup of the news 5 00:00:31,760 --> 00:00:34,720 Speaker 1: and how it pertains to your personal finances, so that 6 00:00:34,760 --> 00:00:37,360 Speaker 1: you don't have to spend all of your life combing 7 00:00:37,360 --> 00:00:39,360 Speaker 1: through the headlines and the articles to find the ones 8 00:00:39,640 --> 00:00:41,000 Speaker 1: that are going to impact your bank account. 9 00:00:41,040 --> 00:00:42,919 Speaker 2: I pick the most important stuff, share it with you 10 00:00:43,120 --> 00:00:45,880 Speaker 2: and stuff, and we offer our hot takes. 11 00:00:45,400 --> 00:00:48,640 Speaker 1: It's kind of what we do. Honestly, you want to 12 00:00:48,680 --> 00:00:51,640 Speaker 1: kick things off. Speaking of hot takes. With the Federal 13 00:00:51,680 --> 00:00:53,880 Speaker 1: Trade Commission, we might disagree. 14 00:00:53,440 --> 00:00:55,400 Speaker 2: On this because I know you know we're going to disagree. 15 00:00:55,440 --> 00:00:57,760 Speaker 2: You disaground this, but I think this is potentially a 16 00:00:57,760 --> 00:00:59,800 Speaker 2: really good thing. The FTC just announced this week that 17 00:00:59,800 --> 00:01:02,600 Speaker 2: they're going to do a click to a click to 18 00:01:02,640 --> 00:01:06,840 Speaker 2: cancel rule. And basically what the FDC wants is for 19 00:01:06,920 --> 00:01:09,840 Speaker 2: companies to not be allowed to if they make it 20 00:01:09,880 --> 00:01:11,800 Speaker 2: really easy to sign up on their website or via 21 00:01:11,840 --> 00:01:13,560 Speaker 2: their app. Hey guess what they need to make it 22 00:01:13,640 --> 00:01:16,240 Speaker 2: just as easy to cancel, and I think it was 23 00:01:16,280 --> 00:01:18,880 Speaker 2: earlier this year met the cable companies testified in front 24 00:01:18,880 --> 00:01:21,000 Speaker 2: of the FTC and they basically said, listen, if we 25 00:01:21,000 --> 00:01:23,200 Speaker 2: make it easy to cancel, then people are actually going 26 00:01:23,240 --> 00:01:25,400 Speaker 2: to cancel our service, and we don't want that. And 27 00:01:25,440 --> 00:01:28,119 Speaker 2: the FTC was like, that's the point, so that people 28 00:01:28,120 --> 00:01:30,319 Speaker 2: can cancel if they want to. And I think the 29 00:01:30,360 --> 00:01:34,480 Speaker 2: cable companies actually retain a massive number of people who 30 00:01:34,480 --> 00:01:36,840 Speaker 2: try to cancel because they call to cancel, they're forced 31 00:01:36,880 --> 00:01:39,280 Speaker 2: to call, they can't they can't use, you know, go 32 00:01:39,319 --> 00:01:42,160 Speaker 2: to the internet website of the provider and cancel, and 33 00:01:42,200 --> 00:01:44,120 Speaker 2: because of that, they end up talking them in or 34 00:01:44,120 --> 00:01:46,080 Speaker 2: they offer him a deal or something like that. It's 35 00:01:46,080 --> 00:01:47,680 Speaker 2: just this rig and role that I think consumers are 36 00:01:47,720 --> 00:01:50,120 Speaker 2: tired of in many ways. I just tried to cancel 37 00:01:50,160 --> 00:01:53,040 Speaker 2: something the other day, a streaming service, and it was 38 00:01:53,080 --> 00:01:55,160 Speaker 2: like hard to find the grade out cancel button at 39 00:01:55,160 --> 00:01:55,600 Speaker 2: the bottom. 40 00:01:55,640 --> 00:01:57,280 Speaker 1: And there's like six steps that you have to go through. 41 00:01:57,280 --> 00:01:59,080 Speaker 1: When it's like the same color as the background, right, 42 00:02:00,280 --> 00:02:02,720 Speaker 1: it's literally impossible unless I select all and then I 43 00:02:02,760 --> 00:02:03,680 Speaker 1: see it highlight right. 44 00:02:03,760 --> 00:02:05,440 Speaker 2: It's like trying to find the unsubscribed button on the 45 00:02:05,480 --> 00:02:07,920 Speaker 2: bottom of an email sometimes it's like finding ale in 46 00:02:08,000 --> 00:02:11,760 Speaker 2: a haysack. But so I kind of like this, it's 47 00:02:11,840 --> 00:02:14,400 Speaker 2: not set in stone yet. There's like six months I 48 00:02:14,400 --> 00:02:17,799 Speaker 2: think before this becomes official. You just had actually trouble 49 00:02:17,800 --> 00:02:20,440 Speaker 2: canceling a gym membership, and. 50 00:02:19,760 --> 00:02:21,119 Speaker 1: So we're not gonna talk about that though. 51 00:02:22,200 --> 00:02:24,440 Speaker 2: But actually that's one of the things is gym's make 52 00:02:24,480 --> 00:02:27,120 Speaker 2: it really hard to cancel. People end up sticking around 53 00:02:27,120 --> 00:02:29,800 Speaker 2: pay an extra, whereas if they made it easier to cancel, 54 00:02:29,840 --> 00:02:32,800 Speaker 2: I think people would be They wouldn't find themselves paying 55 00:02:32,840 --> 00:02:34,640 Speaker 2: for stuff that they're not getting or that they don't want. 56 00:02:34,880 --> 00:02:36,760 Speaker 1: Yeah, I am of two minds with it, because I 57 00:02:36,760 --> 00:02:39,640 Speaker 1: certainly understand. I see the appeal right the ability to 58 00:02:39,680 --> 00:02:42,040 Speaker 1: cancel the same way that you subscribed. It makes it's 59 00:02:42,040 --> 00:02:44,280 Speaker 1: common sense. But at the same time, I just don't 60 00:02:44,360 --> 00:02:47,040 Speaker 1: like how we've arrived at that point. Like I like 61 00:02:47,080 --> 00:02:49,120 Speaker 1: the result and what the end result might be, but 62 00:02:49,240 --> 00:02:51,799 Speaker 1: instead of the government getting involved, obviously, I would rather 63 00:02:51,800 --> 00:02:54,639 Speaker 1: see the free and open market decide and the ability 64 00:02:54,639 --> 00:02:57,840 Speaker 1: for us as consumers to vote with our dollars or 65 00:02:57,919 --> 00:03:00,720 Speaker 1: leave a review, a negative review, cant or with our 66 00:03:00,760 --> 00:03:02,359 Speaker 1: dollars because they're making it so hard for us to 67 00:03:02,440 --> 00:03:04,720 Speaker 1: leave because your dollars are all tied up. Yeah, but 68 00:03:04,960 --> 00:03:06,960 Speaker 1: just the ability to tell your friends about it, I 69 00:03:06,960 --> 00:03:10,919 Speaker 1: think is it's just a simpler, more straightforward way of 70 00:03:11,520 --> 00:03:14,280 Speaker 1: achieving the same ends as opposed to what I see 71 00:03:14,320 --> 00:03:18,680 Speaker 1: being the more complex, expensive way to achieve this sense 72 00:03:18,760 --> 00:03:22,800 Speaker 1: by having a government agency potentially enforce this, because what 73 00:03:22,800 --> 00:03:24,640 Speaker 1: does that actually look like, the government to step in 74 00:03:24,680 --> 00:03:27,080 Speaker 1: and say, hey, they'll do business like this, Like, that's 75 00:03:27,120 --> 00:03:29,040 Speaker 1: the part of it that that turns me off, and 76 00:03:29,040 --> 00:03:31,639 Speaker 1: I would rather see consumers be able to vote with 77 00:03:31,639 --> 00:03:34,960 Speaker 1: your dollars. Yeah. But either way though, I mean, we'll see. 78 00:03:35,080 --> 00:03:37,640 Speaker 1: And obviously if it goes through, and it's a part 79 00:03:37,720 --> 00:03:42,400 Speaker 1: of how businesses are forced to implement some of these changes, 80 00:03:42,440 --> 00:03:44,480 Speaker 1: I'm all for it because it's like, okay, well if 81 00:03:44,480 --> 00:03:47,000 Speaker 1: that's if that's the rule, then we abide by the 82 00:03:47,080 --> 00:03:49,640 Speaker 1: rule and we all get to benefit. In this case 83 00:03:49,840 --> 00:03:52,360 Speaker 1: as a consumer, Yeah, I'll be thankful for it. And 84 00:03:53,440 --> 00:03:55,640 Speaker 1: I think, yeah, if you want to cancel your service, 85 00:03:56,040 --> 00:03:58,520 Speaker 1: it should be you shouldn't have to go to an 86 00:03:58,520 --> 00:04:00,760 Speaker 1: AI bought and chat and and jump through a bunch 87 00:04:00,760 --> 00:04:03,400 Speaker 1: of hoops. When it was they made it super simple 88 00:04:03,440 --> 00:04:05,080 Speaker 1: to sign up. That to me feels kind of like 89 00:04:05,080 --> 00:04:07,720 Speaker 1: a bait and switch, and I think it's a dirty practice. Yeah, 90 00:04:08,080 --> 00:04:10,400 Speaker 1: I just think there are better ways for businesses to 91 00:04:10,800 --> 00:04:12,840 Speaker 1: run their businesses. This makes me think of a kind 92 00:04:12,840 --> 00:04:14,640 Speaker 1: of a random story that we came across this week, 93 00:04:14,800 --> 00:04:18,119 Speaker 1: Home Depot. What they're doing now. They're having their corporate folks, 94 00:04:18,200 --> 00:04:20,760 Speaker 1: their corporate employees, and the CEO is the one who 95 00:04:20,880 --> 00:04:22,760 Speaker 1: implemented this. But they have to go to an actual 96 00:04:22,760 --> 00:04:26,159 Speaker 1: home Depot store to work once a quarter. And the 97 00:04:26,240 --> 00:04:28,440 Speaker 1: goal here is for the people who might be a 98 00:04:28,440 --> 00:04:30,839 Speaker 1: bit more detached from the end product and for the 99 00:04:30,880 --> 00:04:33,839 Speaker 1: services that they're providing to be more connected to you know, 100 00:04:33,839 --> 00:04:36,360 Speaker 1: what the boots on the ground are actually encountering. And 101 00:04:36,480 --> 00:04:38,840 Speaker 1: I think this can only be good for morale and 102 00:04:39,080 --> 00:04:41,240 Speaker 1: for business. This is a smart business move, Yes, And 103 00:04:41,320 --> 00:04:43,400 Speaker 1: this is like the perfect example I think of how 104 00:04:43,560 --> 00:04:45,839 Speaker 1: instead of this being some like mandated from on high, 105 00:04:45,839 --> 00:04:49,160 Speaker 1: from like a government agency, here is an individual company deciding, 106 00:04:49,360 --> 00:04:50,840 Speaker 1: you know what we need to get. We need to 107 00:04:50,920 --> 00:04:52,200 Speaker 1: be more in touch with how it is that our 108 00:04:52,200 --> 00:04:54,240 Speaker 1: consumers are seeing the end product, and that is going 109 00:04:54,240 --> 00:04:55,760 Speaker 1: to allow us to innovate. It's going to allow us 110 00:04:55,760 --> 00:04:57,880 Speaker 1: to make changes. We're going to be able to see that, like, oh, 111 00:04:58,000 --> 00:04:59,920 Speaker 1: we don't like it when we make whatever it is 112 00:05:00,080 --> 00:05:01,760 Speaker 1: is at a home Depot story right, And like, well, 113 00:05:01,800 --> 00:05:03,800 Speaker 1: I hate it that we make customers stand over here 114 00:05:03,839 --> 00:05:05,400 Speaker 1: when they're making returns. Why can't we do this? And 115 00:05:05,560 --> 00:05:07,559 Speaker 1: like there are these small little tweaks along the way 116 00:05:07,839 --> 00:05:08,680 Speaker 1: that you can implement. 117 00:05:09,120 --> 00:05:11,919 Speaker 2: And I think in big companies it's really easy for 118 00:05:12,080 --> 00:05:15,360 Speaker 2: the people at the top to get out of become 119 00:05:15,400 --> 00:05:17,839 Speaker 2: out of touch with what's happening at maybe the individual 120 00:05:17,839 --> 00:05:20,760 Speaker 2: retail locations. And like Sam Walton was famous for visiting 121 00:05:20,839 --> 00:05:23,720 Speaker 2: like all the Walmarts and even visiting his competitors and 122 00:05:23,720 --> 00:05:26,080 Speaker 2: stuff like that too, to get a sense for what's 123 00:05:26,080 --> 00:05:28,440 Speaker 2: happening on the ground level. And I think many CEOs 124 00:05:28,440 --> 00:05:30,120 Speaker 2: don't do that. So the fact that Home Depot is 125 00:05:30,120 --> 00:05:31,920 Speaker 2: doing it feels like kind of like that the show 126 00:05:32,000 --> 00:05:35,240 Speaker 2: Undercover Boss now, where the CEO would dress up and 127 00:05:35,279 --> 00:05:37,520 Speaker 2: work like a day in the minds or something like 128 00:05:37,560 --> 00:05:41,039 Speaker 2: that with the normies that worked for the company. And 129 00:05:41,080 --> 00:05:43,440 Speaker 2: I think that's a good thing. All the pleabs, I 130 00:05:43,440 --> 00:05:46,040 Speaker 2: think that's a great thing. Like Home Depot will probably 131 00:05:46,720 --> 00:05:49,159 Speaker 2: benefit from this as a post. 132 00:05:48,960 --> 00:05:50,640 Speaker 1: And so what we'll see is a business like home 133 00:05:50,680 --> 00:05:53,040 Speaker 1: deepot continue to innovate and do well. Their stocks will 134 00:05:53,080 --> 00:05:56,240 Speaker 1: continue to go up, customer service is going to remain high. 135 00:05:56,279 --> 00:05:59,040 Speaker 1: And then if you see other companies that aren't innovating, 136 00:05:59,120 --> 00:06:01,560 Speaker 1: like I think us all that Kmart is, they've got 137 00:06:01,600 --> 00:06:03,920 Speaker 1: like one more store or something that's going to end 138 00:06:03,960 --> 00:06:06,880 Speaker 1: up closing. Amazing. That's an example of a store that 139 00:06:06,880 --> 00:06:09,040 Speaker 1: that didn't do that didn't keep up with the times exactly. 140 00:06:09,080 --> 00:06:10,200 Speaker 1: And so it's up to the I think it can 141 00:06:10,320 --> 00:06:12,160 Speaker 1: serve their customer well, were on a company company to 142 00:06:12,240 --> 00:06:15,160 Speaker 1: company level as opposed to it being something that needs 143 00:06:15,160 --> 00:06:16,280 Speaker 1: to be mandated from on high. 144 00:06:16,360 --> 00:06:18,279 Speaker 2: Yeah, let's talk about something else, Matt. Let's talk about 145 00:06:18,320 --> 00:06:20,080 Speaker 2: car Loans. We don't like them. 146 00:06:20,120 --> 00:06:20,600 Speaker 1: I hate them. 147 00:06:20,600 --> 00:06:23,599 Speaker 2: We've never liked them. We talked smack about them regularly 148 00:06:23,680 --> 00:06:26,680 Speaker 2: on the show. And it's it's one of those things 149 00:06:26,680 --> 00:06:28,840 Speaker 2: where it has been a problem in the past, and 150 00:06:28,839 --> 00:06:31,960 Speaker 2: it's this problem is getting worse because as car prices 151 00:06:31,960 --> 00:06:34,520 Speaker 2: have risen, interest rates have also gone up, and so 152 00:06:34,640 --> 00:06:36,800 Speaker 2: car affordability has one of the been one of the 153 00:06:36,839 --> 00:06:41,400 Speaker 2: biggest categories, the hardest hit categories by inflation. So yeah, eggs. 154 00:06:41,640 --> 00:06:44,800 Speaker 2: It stinks that those costs more, but the car probably 155 00:06:44,880 --> 00:06:47,560 Speaker 2: impacts your budget far more than just the eggs, and 156 00:06:47,600 --> 00:06:49,880 Speaker 2: it's it's just not a fun situation right to be 157 00:06:49,960 --> 00:06:53,719 Speaker 2: in if you're looking to upgrade your vehicle, because you're 158 00:06:53,839 --> 00:06:55,960 Speaker 2: staring at the price tag the bottom line and you're 159 00:06:55,960 --> 00:06:57,839 Speaker 2: freaking out. You're not used to paying this much for 160 00:06:57,839 --> 00:06:59,560 Speaker 2: a car, especially if it's been five, six, seven years 161 00:06:59,600 --> 00:07:00,800 Speaker 2: since you've had buy one. 162 00:07:00,720 --> 00:07:01,919 Speaker 1: Hopefully even longer. 163 00:07:01,920 --> 00:07:04,479 Speaker 2: Hopefully even longer. While you drive your car, you don't 164 00:07:04,520 --> 00:07:06,560 Speaker 2: have to put up with this problem. But new numbers 165 00:07:06,560 --> 00:07:11,080 Speaker 2: from Edmunds find that people aren't necessarily trading down to 166 00:07:11,160 --> 00:07:14,880 Speaker 2: a cheaper automobile or saving up longer. What they're doing 167 00:07:15,120 --> 00:07:17,760 Speaker 2: is they're increasing the payoff timeline so that they can 168 00:07:17,800 --> 00:07:20,560 Speaker 2: snag the car they want. This is really bad. 169 00:07:20,400 --> 00:07:22,600 Speaker 1: News in our estimation see here in this. 170 00:07:22,560 --> 00:07:25,640 Speaker 2: Eighty four month car loans now account for almost one 171 00:07:25,680 --> 00:07:28,440 Speaker 2: in five of the overall loans that were issued in 172 00:07:28,480 --> 00:07:31,320 Speaker 2: just this past quarter. That has doubled in just the 173 00:07:31,320 --> 00:07:34,880 Speaker 2: past few years, and then so the average car loan 174 00:07:35,000 --> 00:07:37,520 Speaker 2: length is now sixty eight months Matt, so people are 175 00:07:37,560 --> 00:07:40,000 Speaker 2: a lot more people opting for the eighty four, but 176 00:07:40,040 --> 00:07:42,240 Speaker 2: the average is sixty eight. That's more than five and 177 00:07:42,240 --> 00:07:45,000 Speaker 2: a half years to pay off the car that you're buying. 178 00:07:45,560 --> 00:07:48,960 Speaker 2: Outrageously bad news, and it could come with serious financial 179 00:07:48,960 --> 00:07:51,560 Speaker 2: consequences for people down the line. On top of that, 180 00:07:52,040 --> 00:07:54,960 Speaker 2: nearly one in four consumers owe more on their car 181 00:07:55,040 --> 00:07:57,400 Speaker 2: loan than the vehicle is worth, so they're upside down 182 00:07:57,840 --> 00:08:00,360 Speaker 2: in their ride. Something like twenty twenty five, twenty six, 183 00:08:00,360 --> 00:08:03,080 Speaker 2: twenty seven percent of people upside down on their vehicles. 184 00:08:03,280 --> 00:08:07,280 Speaker 2: The national average for upside down balances is sixty four 185 00:08:07,480 --> 00:08:09,920 Speaker 2: one hundred dollars. So talk about being in financial trouble 186 00:08:10,080 --> 00:08:11,560 Speaker 2: when you own more than the car is worth. If 187 00:08:11,600 --> 00:08:13,680 Speaker 2: you're in an act terrible or if you feel like you 188 00:08:13,720 --> 00:08:15,720 Speaker 2: need to trade your car up, sorry, you still owe 189 00:08:15,720 --> 00:08:17,520 Speaker 2: a bunch of money on it. That gets people into 190 00:08:17,720 --> 00:08:19,640 Speaker 2: even worse car loans when they trade it in and 191 00:08:19,640 --> 00:08:21,400 Speaker 2: they get another car on top of. 192 00:08:21,320 --> 00:08:24,760 Speaker 1: That, then it perpetuates. It creates a six cycle, and 193 00:08:24,800 --> 00:08:27,040 Speaker 1: we want people to avoid car loans all together. We 194 00:08:27,080 --> 00:08:29,240 Speaker 1: want you to keep your current car on the road. 195 00:08:29,640 --> 00:08:33,440 Speaker 1: Maintaining your vehicles highly underrated. Everybody wants to hit the 196 00:08:33,440 --> 00:08:37,280 Speaker 1: easy button, and what easy means is expensive signing up 197 00:08:37,280 --> 00:08:39,719 Speaker 1: for a new loan to where they don't have to 198 00:08:39,760 --> 00:08:42,280 Speaker 1: like take the car into the shop. Like literally this morning, 199 00:08:42,400 --> 00:08:44,920 Speaker 1: I spent like five ten minutes the car. The tire 200 00:08:45,120 --> 00:08:47,160 Speaker 1: pressure gauge light came on on the dash and I 201 00:08:47,160 --> 00:08:48,720 Speaker 1: ignored it for a couple of days, and Kate was like, hey, 202 00:08:48,760 --> 00:08:50,800 Speaker 1: what's that all about. I'm like, okay, I finally get 203 00:08:50,840 --> 00:08:53,640 Speaker 1: to it. But most people don't like even doing that. 204 00:08:53,760 --> 00:08:56,640 Speaker 1: But spending some time, even if it's cold outside, to 205 00:08:56,840 --> 00:08:59,520 Speaker 1: get out there and get the tire pressure backup means 206 00:08:59,559 --> 00:09:01,319 Speaker 1: those tires are going to last longer. But we need 207 00:09:01,320 --> 00:09:03,560 Speaker 1: to do that with all aspects of our car. But 208 00:09:03,600 --> 00:09:06,000 Speaker 1: then if you eventually do want to get a new vehicle, 209 00:09:06,080 --> 00:09:08,119 Speaker 1: just keep saving up. If you can be the opposite 210 00:09:08,400 --> 00:09:10,160 Speaker 1: of the average American on this front, if you can 211 00:09:10,200 --> 00:09:13,040 Speaker 1: stay disciplined to keep car debt out of your life, 212 00:09:13,040 --> 00:09:15,840 Speaker 1: you're going to be shocked at how this single choice, 213 00:09:15,920 --> 00:09:17,600 Speaker 1: just as one choice, can help you to make financial 214 00:09:17,600 --> 00:09:20,520 Speaker 1: progress in leaps and bounds. Yea, as a friend of 215 00:09:20,559 --> 00:09:22,400 Speaker 1: the show car dealership Guy, he said this in his 216 00:09:22,440 --> 00:09:25,480 Speaker 1: new newsletter. I'll quote this. He wrote, Longer loan terms 217 00:09:25,520 --> 00:09:28,079 Speaker 1: can make monthly payments easier to manage. Sure, that's why 218 00:09:28,080 --> 00:09:30,560 Speaker 1: people do it. Yeah, but most Americans aren't looking to 219 00:09:30,600 --> 00:09:33,400 Speaker 1: hold onto their cars for seven years. The real risk 220 00:09:33,520 --> 00:09:36,520 Speaker 1: is that these extended loans increase the chance of carrying 221 00:09:36,559 --> 00:09:39,600 Speaker 1: negative equity into their next purchase if they even keep 222 00:09:39,679 --> 00:09:41,800 Speaker 1: up with their payments in the first place, which is 223 00:09:41,920 --> 00:09:44,720 Speaker 1: one hundred percent true. So we don't want you to 224 00:09:44,760 --> 00:09:48,000 Speaker 1: put yourself in this position. I think Joel would say, Hey, 225 00:09:48,240 --> 00:09:49,880 Speaker 1: it's so, if you're going to get a loan, make 226 00:09:49,880 --> 00:09:52,199 Speaker 1: sure to limit it to you know, forty eight months 227 00:09:52,240 --> 00:09:54,760 Speaker 1: or maybe or less. Certainly that's much better than the 228 00:09:54,800 --> 00:09:58,040 Speaker 1: seven year terms car even a smaller loan term. But man, 229 00:09:58,120 --> 00:10:01,160 Speaker 1: you can get reliable vehicles by saving up cash. I 230 00:10:01,200 --> 00:10:03,480 Speaker 1: think most Americans who are finding themselves in a position 231 00:10:03,520 --> 00:10:06,040 Speaker 1: where they're looking at a new vehicle aren't in a 232 00:10:06,240 --> 00:10:09,320 Speaker 1: highly urgent situation. Uh. And instead it's more of a 233 00:10:09,360 --> 00:10:13,040 Speaker 1: lifestyle upgrade. And they're more Americans are financing these lifestyle upgrades. 234 00:10:13,080 --> 00:10:13,840 Speaker 1: And that's what I hate seeing. 235 00:10:13,880 --> 00:10:17,120 Speaker 2: And I think just because it's become normal, just because 236 00:10:17,400 --> 00:10:19,120 Speaker 2: everybody's doing it. I mean, I don't know if your 237 00:10:19,160 --> 00:10:20,520 Speaker 2: mom ever said this to you, map, but my mom 238 00:10:20,559 --> 00:10:22,480 Speaker 2: but always yeah, just because everyone else is doing it. 239 00:10:22,679 --> 00:10:24,360 Speaker 2: I mean, you're going to do it too. If Matt 240 00:10:24,440 --> 00:10:26,040 Speaker 2: jumped off a bridge, Joel, would you do it too? 241 00:10:26,040 --> 00:10:27,680 Speaker 2: And I'd be like, I don't know, maybe if there's 242 00:10:27,720 --> 00:10:29,360 Speaker 2: water below and it looks kind of fun, it's only 243 00:10:29,400 --> 00:10:31,320 Speaker 2: like thirty feet. Sure, I was actually really into that 244 00:10:31,440 --> 00:10:33,520 Speaker 2: high school you were in a bridge jumping, so maybe 245 00:10:33,520 --> 00:10:35,679 Speaker 2: I would mom. And maybe I'm actually undermining my own 246 00:10:35,720 --> 00:10:37,760 Speaker 2: point here, but yeah, if everyone else is. 247 00:10:37,720 --> 00:10:40,439 Speaker 1: Doing what I failed to Dijoel was oftentimes check the water, 248 00:10:40,800 --> 00:10:44,079 Speaker 1: like for down trees, that's that's oh really, Oh yeah, 249 00:10:44,160 --> 00:10:45,880 Speaker 1: you gotta you gotta do that. If you're gonna do 250 00:10:45,920 --> 00:10:48,520 Speaker 1: some like cliff jumping, rock jumping at the lake, trestle 251 00:10:48,880 --> 00:10:51,120 Speaker 1: train trestle jumping, you always need to check the water, 252 00:10:51,240 --> 00:10:53,880 Speaker 1: makes sense, make sure it's clear of any debris. 253 00:10:53,480 --> 00:10:55,200 Speaker 2: And r or else you can have a major accident, 254 00:10:55,240 --> 00:10:58,400 Speaker 2: right exactly exactly, So I think I think you've gone 255 00:10:58,400 --> 00:10:59,280 Speaker 2: as straight here from my point. 256 00:10:59,280 --> 00:11:02,360 Speaker 1: Matt all sorts of it amount of money, how to 257 00:11:02,400 --> 00:11:04,040 Speaker 1: save money by not going to the hospital, But I 258 00:11:04,080 --> 00:11:05,520 Speaker 1: think it's just so normal. 259 00:11:05,559 --> 00:11:08,120 Speaker 2: And when we talk about what the average person should 260 00:11:08,120 --> 00:11:09,800 Speaker 2: spend on their car payment, or if you look at 261 00:11:09,840 --> 00:11:12,400 Speaker 2: like rules of Thumb, typically it's ten percent of your 262 00:11:12,960 --> 00:11:16,640 Speaker 2: overall income should or can go to car stuff. I 263 00:11:16,640 --> 00:11:18,960 Speaker 2: would prefer to be for most folks for that to 264 00:11:19,000 --> 00:11:21,360 Speaker 2: be far smaller, and that just gives you so much 265 00:11:21,360 --> 00:11:24,120 Speaker 2: more flexibility in terms of vacation. You want to go 266 00:11:24,200 --> 00:11:27,760 Speaker 2: on increasing your saving and investment investment rate. So just 267 00:11:27,800 --> 00:11:30,800 Speaker 2: because everybody around you's doing it, doesn't mean that we 268 00:11:30,800 --> 00:11:33,280 Speaker 2: should do it too. And I just see that like 269 00:11:33,480 --> 00:11:36,840 Speaker 2: this current situation for a significant portion of American consumers, 270 00:11:36,920 --> 00:11:39,760 Speaker 2: mat it's untenable and it's going to lead to some 271 00:11:39,920 --> 00:11:42,720 Speaker 2: really horrendous side effects down the road. From a personal 272 00:11:42,760 --> 00:11:46,959 Speaker 2: finance standpoint, So keeping your car expenses and your car 273 00:11:47,040 --> 00:11:49,440 Speaker 2: note if you have to take one on to a minimum, 274 00:11:49,480 --> 00:11:51,520 Speaker 2: and being really thoughtful about, Okay, how long is it 275 00:11:51,559 --> 00:11:53,080 Speaker 2: going to take me to pay this off? And then 276 00:11:53,120 --> 00:11:55,360 Speaker 2: how can I continue to bank that money so that 277 00:11:55,400 --> 00:11:56,800 Speaker 2: I don't ever have to have a car loan in 278 00:11:56,800 --> 00:11:57,240 Speaker 2: the future. 279 00:11:57,440 --> 00:12:00,880 Speaker 1: That's the goal seven year car loans here that daysh 280 00:12:00,960 --> 00:12:03,920 Speaker 1: Let's go ahead and talk about artificial intelligence, Joel, I 281 00:12:03,960 --> 00:12:07,240 Speaker 1: personally don't exactly know. I guess what to think about AI, 282 00:12:07,440 --> 00:12:10,200 Speaker 1: how it will impact our future. Are we all going 283 00:12:10,280 --> 00:12:12,760 Speaker 1: to live in the Matrix someday? I actually don't think so, 284 00:12:13,120 --> 00:12:15,360 Speaker 1: but some folks have if we lived in the Matrix 285 00:12:15,400 --> 00:12:19,040 Speaker 1: and had to watch that movie on repeat. Interesting, I 286 00:12:19,080 --> 00:12:21,360 Speaker 1: haven't thought about that. It's feeling a little too meta. Yeah, 287 00:12:22,360 --> 00:12:24,280 Speaker 1: do our younger listeners even though what the matrix is. 288 00:12:24,320 --> 00:12:25,720 Speaker 1: I'm sure they've heard of it. But if you haven't 289 00:12:25,720 --> 00:12:27,800 Speaker 1: seen it, they have, Like the newer Matrix come out 290 00:12:27,840 --> 00:12:31,120 Speaker 1: a few years ago, right, revolution, Yeah, revolutions, I think 291 00:12:31,160 --> 00:12:34,439 Speaker 1: the only go to fifty year old people. The first 292 00:12:34,480 --> 00:12:35,920 Speaker 1: one still holds up by the way. I think they're 293 00:12:35,960 --> 00:12:38,720 Speaker 1: all decent. But at the time it was like mind 294 00:12:38,760 --> 00:12:42,520 Speaker 1: bending in a way that our minds hadn't been. But 295 00:12:42,600 --> 00:12:46,400 Speaker 1: I enjoyed reading an MIT professor who recently wrote that 296 00:12:46,800 --> 00:12:49,800 Speaker 1: he believes that AI can only do basically five percent 297 00:12:49,840 --> 00:12:52,400 Speaker 1: of all jobs right now. Basically, you're saying it could 298 00:12:52,480 --> 00:12:55,160 Speaker 1: help some folks and replace others, but that is not 299 00:12:55,400 --> 00:12:58,439 Speaker 1: going to like foment and economic revolution that's going to 300 00:12:58,520 --> 00:13:02,160 Speaker 1: render all humans obsolete. And I'll say I'm actually I 301 00:13:02,160 --> 00:13:04,120 Speaker 1: hope he's right, because there have been some recent stories 302 00:13:04,120 --> 00:13:07,520 Speaker 1: about Google's new AI generated podcasts. Have you heard some 303 00:13:07,559 --> 00:13:09,800 Speaker 1: of those, Joel, It's uncanny what they're able to do. 304 00:13:09,840 --> 00:13:11,839 Speaker 1: I'm a little I was quaking in my Adidas when 305 00:13:11,880 --> 00:13:14,520 Speaker 1: I read them. Matt look consered. Actually, are you actually 306 00:13:14,559 --> 00:13:15,080 Speaker 1: worried about that? 307 00:13:15,200 --> 00:13:17,240 Speaker 2: Is that I'm not because I just think I think 308 00:13:17,280 --> 00:13:21,040 Speaker 2: the biggest thing that AI can't do is personality generated. 309 00:13:21,080 --> 00:13:22,800 Speaker 1: So like I can't make it fun, right, I mean, 310 00:13:22,840 --> 00:13:24,360 Speaker 1: they might think they can make it fun, but it's 311 00:13:24,360 --> 00:13:26,880 Speaker 1: going to be this sort of sterile version of fun 312 00:13:26,880 --> 00:13:29,400 Speaker 1: as opposed to like the real stuff that we're experiencing 313 00:13:29,400 --> 00:13:30,960 Speaker 1: in our day to day lives. Think about this. 314 00:13:30,960 --> 00:13:33,200 Speaker 2: Think about how cheap it's gotten to listen to the 315 00:13:33,240 --> 00:13:36,120 Speaker 2: music you want to listen to, whatever album, whatever song, 316 00:13:36,160 --> 00:13:39,200 Speaker 2: whatever artist you want to listen to, deep cuts, no matter. 317 00:13:39,440 --> 00:13:42,120 Speaker 2: You can listen to it for for for your cheap. 318 00:13:42,840 --> 00:13:44,959 Speaker 2: But think about how much money people pay to go 319 00:13:45,000 --> 00:13:49,360 Speaker 2: see a concert in person. It's insane. The yeah, the 320 00:13:49,400 --> 00:13:52,040 Speaker 2: price tag for concerts for big artists and stuff like 321 00:13:52,080 --> 00:13:54,240 Speaker 2: that has gone through the roof. And I think people 322 00:13:54,280 --> 00:13:57,040 Speaker 2: more than ever want authenticity. They want real life, they 323 00:13:57,040 --> 00:14:00,199 Speaker 2: want real people, they want experiences, and I think I 324 00:14:00,240 --> 00:14:02,320 Speaker 2: don't know, hopefully hopefully listening to Matt Joel is in 325 00:14:02,400 --> 00:14:04,560 Speaker 2: experience of sorts that people will want to listen to 326 00:14:05,240 --> 00:14:07,040 Speaker 2: even though they are going to be AI podcasts out there. 327 00:14:07,080 --> 00:14:09,040 Speaker 1: They want a little rougher around the edges, and that's 328 00:14:09,040 --> 00:14:10,400 Speaker 1: what we're able to provide. That's right. 329 00:14:11,200 --> 00:14:13,280 Speaker 2: They want the stumbles, they want the bumbles, they want 330 00:14:13,320 --> 00:14:14,320 Speaker 2: a few ums on occasion. 331 00:14:14,679 --> 00:14:18,120 Speaker 1: I think, so whatever other idiocy we might come up 332 00:14:18,160 --> 00:14:18,319 Speaker 1: with it. 333 00:14:18,440 --> 00:14:20,640 Speaker 2: Yeah, but I think that's a really smart prediction. I 334 00:14:20,640 --> 00:14:23,520 Speaker 2: think that's probably true, Matt. Five percent of jobs interrupted 335 00:14:23,560 --> 00:14:26,040 Speaker 2: significantly by AI. That makes sense to me. I think 336 00:14:26,080 --> 00:14:29,120 Speaker 2: some of the massive doomsayers on AI, I don't know. 337 00:14:29,200 --> 00:14:32,160 Speaker 2: I just I don't see that future to take them seriously. Yeah, 338 00:14:32,440 --> 00:14:35,760 Speaker 2: one industry we'd love to see disrupted by AI is 339 00:14:35,840 --> 00:14:39,080 Speaker 2: real estate. And that's because real estate commissions make it 340 00:14:39,280 --> 00:14:41,320 Speaker 2: so much more expensive. You're buying sell homes, Kirkma, the 341 00:14:41,360 --> 00:14:42,400 Speaker 2: realtors with the pitchforks. 342 00:14:42,480 --> 00:14:46,400 Speaker 1: Yeah, they're like, oh, you're justifying your profession, but you're 343 00:14:46,440 --> 00:14:48,560 Speaker 1: coming after hours, sorry, guys, shirks. 344 00:14:49,080 --> 00:14:51,440 Speaker 2: And that's not because we hate real estate agents and 345 00:14:51,440 --> 00:14:53,240 Speaker 2: we think that and I don't think that that AI 346 00:14:53,320 --> 00:14:56,600 Speaker 2: is going to reduce the need for good realtors, but 347 00:14:56,640 --> 00:14:59,360 Speaker 2: I think it will maybe grease the kids and potentially 348 00:14:59,400 --> 00:15:03,120 Speaker 2: bring commission back into a reasonable range total. And there's 349 00:15:03,120 --> 00:15:05,960 Speaker 2: this new company that's basically trying to bring those costs down. 350 00:15:06,320 --> 00:15:09,040 Speaker 2: It's billing itself as AI for home buying. It's called 351 00:15:09,400 --> 00:15:11,880 Speaker 2: fly Homes. So I was reading an article about this, 352 00:15:11,960 --> 00:15:15,400 Speaker 2: Matt and basically, this company believes that over time, AI 353 00:15:15,600 --> 00:15:17,480 Speaker 2: is going to help answer most of the questions that 354 00:15:17,520 --> 00:15:19,680 Speaker 2: you have about a home that you want to buy. So, hey, 355 00:15:19,800 --> 00:15:21,560 Speaker 2: not only did you find it on Zilo, you got 356 00:15:21,560 --> 00:15:24,080 Speaker 2: some basic information. Now you go to fly homes and 357 00:15:24,120 --> 00:15:27,040 Speaker 2: you're like, hey, has this cross space ever been flooded? 358 00:15:27,360 --> 00:15:30,480 Speaker 2: Or there's other questions you can ask. And this AI 359 00:15:30,640 --> 00:15:33,000 Speaker 2: is going to learn about like apparently all the homes 360 00:15:33,000 --> 00:15:34,760 Speaker 2: in the country, and it's going to be able to 361 00:15:35,000 --> 00:15:37,080 Speaker 2: give you more informations and then I'll help you even 362 00:15:37,280 --> 00:15:40,040 Speaker 2: write an offer. It might even help you negotiate. What 363 00:15:40,080 --> 00:15:42,840 Speaker 2: happens if two ais are negotiating against each other, I 364 00:15:42,920 --> 00:15:46,840 Speaker 2: have no idea. Both of those systems just completely break down, 365 00:15:46,960 --> 00:15:50,240 Speaker 2: and it's like the seventies game or seventies movie wargames. 366 00:15:50,360 --> 00:15:51,800 Speaker 2: You remember that, no, I. 367 00:15:51,720 --> 00:15:54,720 Speaker 1: Don't involve the computer. Ok yeah, I'm playing against itself 368 00:15:54,760 --> 00:15:57,320 Speaker 1: running different scenarios. Okay, yeah, I mean maybe it ends 369 00:15:57,400 --> 00:16:00,360 Speaker 1: up being like that. I don't know if fly homes 370 00:16:00,400 --> 00:16:02,360 Speaker 1: like how if this is ready for primetime, or if 371 00:16:02,360 --> 00:16:04,720 Speaker 1: in a few years, as they continue to make progress, 372 00:16:04,760 --> 00:16:07,400 Speaker 1: will this actually be able to help consumers. I don't 373 00:16:07,440 --> 00:16:10,680 Speaker 1: see artificial intelligence replacing agents now, but I do see 374 00:16:10,720 --> 00:16:13,320 Speaker 1: it becoming maybe an accessory and helping to bring down 375 00:16:13,360 --> 00:16:17,160 Speaker 1: costs for consumers, just maybe a helpful tool for agents 376 00:16:17,200 --> 00:16:20,240 Speaker 1: to maximize their time, a way to reduce the transaction costs, 377 00:16:20,280 --> 00:16:22,920 Speaker 1: because yeah, they're prohibitive in so many ways, and I 378 00:16:22,960 --> 00:16:25,440 Speaker 1: do think they prevent the housing market from being as 379 00:16:25,440 --> 00:16:27,360 Speaker 1: fluid as it could be. The pricing model, like the 380 00:16:27,400 --> 00:16:29,640 Speaker 1: way the pricing structure works or has worked in the 381 00:16:29,680 --> 00:16:31,480 Speaker 1: past when it comes to realtors. That's I think that's 382 00:16:31,520 --> 00:16:33,400 Speaker 1: the biggest thing that's going to get disrupted. And as 383 00:16:33,440 --> 00:16:35,520 Speaker 1: I think about it, the biggest the best parallel that 384 00:16:35,560 --> 00:16:38,560 Speaker 1: I can think of are financial advisors. And in the past, 385 00:16:38,680 --> 00:16:42,480 Speaker 1: typically the structure for payment is assets under management, and 386 00:16:42,560 --> 00:16:45,560 Speaker 1: so if you've got clients and they're worth tons of money, dude, 387 00:16:45,560 --> 00:16:48,440 Speaker 1: you are rolling in it. Yeah, But now the way 388 00:16:48,480 --> 00:16:50,960 Speaker 1: it works. Oftentimes it's a flat fee, so you get 389 00:16:51,000 --> 00:16:53,840 Speaker 1: the services, and maybe it's not yeah, okay, maybe they're 390 00:16:53,880 --> 00:16:56,000 Speaker 1: not taking you out to lunch, maybe you're not going 391 00:16:56,040 --> 00:16:58,600 Speaker 1: golfing with them, and because you're a you're not a 392 00:16:58,600 --> 00:17:01,120 Speaker 1: big high roller or anything like that. But you are being 393 00:17:01,400 --> 00:17:03,520 Speaker 1: provided the services that they're able to provide all of 394 00:17:03,560 --> 00:17:05,639 Speaker 1: their clients, regardless of how much money they make. And 395 00:17:05,720 --> 00:17:07,399 Speaker 1: in a similar way, I think the same might be 396 00:17:07,440 --> 00:17:10,000 Speaker 1: true when it comes to realtors, Like, why just because 397 00:17:10,040 --> 00:17:12,359 Speaker 1: you are selling a house that's eight hundred thousand dollars 398 00:17:12,400 --> 00:17:14,280 Speaker 1: as opposed to four hundred thousand dollars, does that mean 399 00:17:14,280 --> 00:17:16,280 Speaker 1: you should be making twice as much when maybe you 400 00:17:16,320 --> 00:17:18,600 Speaker 1: did it twice the work. I don't think so, and 401 00:17:18,640 --> 00:17:22,360 Speaker 1: so in that way, and again and all the realtors 402 00:17:22,359 --> 00:17:23,840 Speaker 1: are going to come after us. 403 00:17:23,840 --> 00:17:27,760 Speaker 2: They they don't like the three percent rule being threatened 404 00:17:27,840 --> 00:17:30,240 Speaker 2: because it and again, of. 405 00:17:30,160 --> 00:17:31,399 Speaker 1: Course it hurts their bottom line. 406 00:17:31,560 --> 00:17:32,919 Speaker 2: But when you look at the numbers, there's a ton 407 00:17:32,960 --> 00:17:34,720 Speaker 2: of real estate agents who don't make much money, and 408 00:17:34,720 --> 00:17:37,360 Speaker 2: that's because typically they're doing it super part time. 409 00:17:38,400 --> 00:17:40,440 Speaker 1: O their license and they only help out their friends. 410 00:17:40,560 --> 00:17:42,119 Speaker 2: Right, there's a lot of agents out there, though, the 411 00:17:42,520 --> 00:17:44,359 Speaker 2: agents who make a lot of sales or help a 412 00:17:44,400 --> 00:17:46,000 Speaker 2: lot of people through it the year, they do quite 413 00:17:46,000 --> 00:17:48,320 Speaker 2: well for themselves, and I'm not worried about those people 414 00:17:48,400 --> 00:17:50,520 Speaker 2: not being able to continue doing well for themselves. 415 00:17:50,560 --> 00:17:52,200 Speaker 1: I'm just a full timers are going to be fine. 416 00:17:52,240 --> 00:17:54,840 Speaker 2: I just think that there's probably a more fair way 417 00:17:54,920 --> 00:17:57,359 Speaker 2: to compensate, and for some agents it might even end 418 00:17:57,480 --> 00:17:59,760 Speaker 2: up meaning that they make more. Matt, We've got more 419 00:17:59,760 --> 00:18:01,840 Speaker 2: to get to on this episode. We're actually going to 420 00:18:01,880 --> 00:18:05,120 Speaker 2: talk about real estate prices going down in some parts 421 00:18:05,119 --> 00:18:07,280 Speaker 2: of the country. We'll get to that and more right 422 00:18:07,320 --> 00:18:07,679 Speaker 2: after this. 423 00:18:15,680 --> 00:18:17,439 Speaker 1: All right, buddy, we are back from the break, and 424 00:18:17,560 --> 00:18:20,320 Speaker 1: of course now we've got our ludicrous headline of the week, 425 00:18:20,359 --> 00:18:23,320 Speaker 1: which this week is from Wired magazine. I used to 426 00:18:23,320 --> 00:18:27,200 Speaker 1: actually be a subscriber to the physical Wired magazine back 427 00:18:27,200 --> 00:18:28,480 Speaker 1: in the day. I was into the text. 428 00:18:28,480 --> 00:18:31,800 Speaker 2: I saw that the Atlantic just increased the number of 429 00:18:32,359 --> 00:18:34,600 Speaker 2: physical magazines are sending out to give a year from 430 00:18:34,640 --> 00:18:36,280 Speaker 2: ten to twelve. I was like, our magazine's back. 431 00:18:36,320 --> 00:18:38,320 Speaker 1: And I think this goes to like people want physical stuff. 432 00:18:38,359 --> 00:18:40,840 Speaker 1: Yeah they are, they are, well the onion. I think 433 00:18:40,880 --> 00:18:43,919 Speaker 1: it was like a decade ago stopped actually creating something 434 00:18:43,960 --> 00:18:45,760 Speaker 1: that you could hold. Yeah, but then they I think 435 00:18:45,760 --> 00:18:48,280 Speaker 1: they're realizing this is something similar. I'm all about it 436 00:18:48,320 --> 00:18:49,760 Speaker 1: because I'm actually I like this trend. 437 00:18:49,880 --> 00:18:51,359 Speaker 2: There are a couple of magazines like I don't think 438 00:18:51,359 --> 00:18:54,359 Speaker 2: I subscribed to any magazines right now, physical magazines, and 439 00:18:54,440 --> 00:18:56,080 Speaker 2: part of me wants to go subscribe to a couple 440 00:18:56,200 --> 00:18:58,040 Speaker 2: just because there's something about getting into the mail holding 441 00:18:58,040 --> 00:18:58,440 Speaker 2: in your hands. 442 00:18:58,480 --> 00:19:01,520 Speaker 1: It's special and the design choices that go into like 443 00:19:01,600 --> 00:19:03,919 Speaker 1: the just the paper weight, like all the old school 444 00:19:04,119 --> 00:19:07,560 Speaker 1: journalism magazine folks are like, yeah, yeah, bring them back. 445 00:19:07,840 --> 00:19:11,199 Speaker 1: But again, this headline is from Wired, and the headline reads, 446 00:19:11,560 --> 00:19:14,359 Speaker 1: the more this releix costs, the more you want it. 447 00:19:15,720 --> 00:19:18,040 Speaker 1: We're gonna knock on luxury a little bit. This is 448 00:19:18,080 --> 00:19:20,919 Speaker 1: why we don't buy fancy stuff, Joel. I try not 449 00:19:20,960 --> 00:19:24,399 Speaker 1: to care about luxury goods, and in part it's because 450 00:19:24,440 --> 00:19:27,040 Speaker 1: the finest luxury good makers out there, they typically raise 451 00:19:27,119 --> 00:19:31,040 Speaker 1: prices much faster than the rate of inflation. Yet it 452 00:19:31,080 --> 00:19:34,520 Speaker 1: only makes their products. So for instance, Swiss watches fancy 453 00:19:34,760 --> 00:19:38,959 Speaker 1: handmade bags, it makes them more desirable, which sounds. 454 00:19:38,480 --> 00:19:40,760 Speaker 2: Like the opposite should be true, right If this is 455 00:19:41,119 --> 00:19:43,360 Speaker 2: how luxury works, though, Josaster in the rate of inflation, 456 00:19:43,640 --> 00:19:45,400 Speaker 2: then what like, why do I want it more? 457 00:19:45,440 --> 00:19:49,560 Speaker 1: It's the forbidden fruit. That's why we buy these goods 458 00:19:49,560 --> 00:19:53,200 Speaker 1: in a desire to signify social status. And we'll keep 459 00:19:53,320 --> 00:19:57,480 Speaker 1: buying these goods that are widely considered exclusive because of 460 00:19:57,520 --> 00:19:59,280 Speaker 1: what it reveals to the people around us, what it 461 00:19:59,359 --> 00:20:03,280 Speaker 1: signals as so good. Old Teddy Roosevelt said, this comparison 462 00:20:03,480 --> 00:20:06,320 Speaker 1: is the thief of joy. But Joel, it'll also rob 463 00:20:06,400 --> 00:20:08,359 Speaker 1: you of your hard earned money. It robs you with 464 00:20:08,359 --> 00:20:10,280 Speaker 1: the freedom that it could have bought you instead when 465 00:20:10,320 --> 00:20:14,440 Speaker 1: we focus on buying not only stuff, but luxury goods 466 00:20:14,480 --> 00:20:16,560 Speaker 1: that have very little intrinsic value. 467 00:20:16,600 --> 00:20:18,480 Speaker 2: And I think for some people, Matt, it's okay to 468 00:20:18,560 --> 00:20:21,280 Speaker 2: desire some things that are upper echelon or that are nicer. 469 00:20:21,280 --> 00:20:23,080 Speaker 2: And if you have the money to spend on those things, 470 00:20:23,560 --> 00:20:26,000 Speaker 2: and you've budgeted appropriately and you're doing all the other 471 00:20:26,080 --> 00:20:28,360 Speaker 2: smart stuff with your money and Rolexes or your craft 472 00:20:28,400 --> 00:20:32,040 Speaker 2: beer equivalent or something, that's fine, Like I've got no 473 00:20:32,160 --> 00:20:34,399 Speaker 2: beef with you on that. But I think sometimes people 474 00:20:34,720 --> 00:20:36,800 Speaker 2: buy the things they can't afford in an attempt to 475 00:20:36,840 --> 00:20:39,000 Speaker 2: signal and they're not doing the other things, and they 476 00:20:39,000 --> 00:20:41,520 Speaker 2: put themselves into financial buying because of it. So you 477 00:20:41,520 --> 00:20:44,000 Speaker 2: got to watch out for that. And the other side 478 00:20:44,000 --> 00:20:46,480 Speaker 2: of the coin to Matt is, I'm curious to hear 479 00:20:46,480 --> 00:20:49,160 Speaker 2: your thoughts on this. I hear that like, Rolexes continue 480 00:20:49,160 --> 00:20:51,600 Speaker 2: to go up in value, so it's an investment, Joel. 481 00:20:52,080 --> 00:20:54,040 Speaker 2: I guess in some ways it could be right. So 482 00:20:54,359 --> 00:20:57,200 Speaker 2: maybe you don't trick yourself into thinking of it that way. 483 00:20:57,320 --> 00:20:59,240 Speaker 2: But when you see like some of those vintage Rolexes, 484 00:20:59,320 --> 00:21:01,280 Speaker 2: or there's some kind to rolexes that continue to go 485 00:21:01,359 --> 00:21:03,119 Speaker 2: up in value if you take care of it year 486 00:21:03,160 --> 00:21:07,479 Speaker 2: after year, maybe that's one reason to at least not 487 00:21:07,560 --> 00:21:09,639 Speaker 2: be as down on luxury goods as it might otherwise be. 488 00:21:09,880 --> 00:21:11,080 Speaker 2: Sure doesn't mean I'm buying one. 489 00:21:11,119 --> 00:21:13,680 Speaker 1: That's how you can justify it. No, I'm not interested personally. 490 00:21:13,840 --> 00:21:17,160 Speaker 1: I am more of a speedmaster, an Omega speedmaster guy. Yeah, 491 00:21:17,240 --> 00:21:19,000 Speaker 1: less of a Rolex fan. How much does this cost? 492 00:21:19,280 --> 00:21:23,320 Speaker 1: Just as much? I think? Oh really? Oh yeah, especially one? No. No, 493 00:21:23,400 --> 00:21:26,280 Speaker 1: I just have looked at him from afar and I 494 00:21:27,119 --> 00:21:28,960 Speaker 1: don't think I will ever be able to allow myself 495 00:21:28,960 --> 00:21:30,159 Speaker 1: to actually do it because of all the things I 496 00:21:30,240 --> 00:21:31,760 Speaker 1: just said, like, I'm trying to try and buy you 497 00:21:31,760 --> 00:21:34,240 Speaker 1: one for your birthday. Dude, if you did that, that 498 00:21:34,280 --> 00:21:38,919 Speaker 1: would be stupid, But I would totally wear it, Like 499 00:21:38,960 --> 00:21:41,720 Speaker 1: do I put it next to my garment watch or yeah, 500 00:21:41,840 --> 00:21:43,040 Speaker 1: like what do I do at that point? One on 501 00:21:43,080 --> 00:21:44,960 Speaker 1: each rest? No. I mean we've I think we shared 502 00:21:44,960 --> 00:21:46,440 Speaker 1: the story about how Kate and I were on a 503 00:21:46,520 --> 00:21:48,399 Speaker 1: date and there was a watch club meeting at one 504 00:21:48,440 --> 00:21:51,760 Speaker 1: of our favorite local spots, and man, the ability to 505 00:21:51,800 --> 00:21:53,120 Speaker 1: get my I was like, what are you guys doing? 506 00:21:53,160 --> 00:21:55,480 Speaker 1: And I see all these watches and they're they're collectors. Yeah. 507 00:21:55,600 --> 00:21:57,040 Speaker 1: It was also encouraging to hear that you can kind 508 00:21:57,040 --> 00:21:59,680 Speaker 1: of get into it without dropping ridiculous amounts of money 509 00:21:59,680 --> 00:22:02,040 Speaker 1: on some of the the you know, the Omegas or 510 00:22:02,080 --> 00:22:04,239 Speaker 1: the Rolexes. There's a lot of other sort of like 511 00:22:04,320 --> 00:22:07,560 Speaker 1: medium tier brands as well. If that's something that you're into, 512 00:22:07,720 --> 00:22:09,440 Speaker 1: I feel like, I'm man, if you've got the money, 513 00:22:09,480 --> 00:22:11,840 Speaker 1: if you are in if gosh that I can't believe. 514 00:22:11,840 --> 00:22:15,359 Speaker 1: I so easily, like jiu jitsued myself into like trying 515 00:22:15,359 --> 00:22:17,200 Speaker 1: to say that this is okay to get I was 516 00:22:17,200 --> 00:22:19,280 Speaker 1: gonna add this. You just we talked about physical magazines 517 00:22:19,320 --> 00:22:22,920 Speaker 1: for just a second. I think physical like analog goods. Also, 518 00:22:22,960 --> 00:22:25,600 Speaker 1: because we live in such a digital world, something like 519 00:22:26,040 --> 00:22:29,560 Speaker 1: a handmade watch, analog watch. There's something cool about that 520 00:22:30,040 --> 00:22:32,320 Speaker 1: in an age where everything's on a screen, way cooler 521 00:22:32,400 --> 00:22:35,040 Speaker 1: than like an Apple watch. So maybe buy a really 522 00:22:35,040 --> 00:22:37,520 Speaker 1: expensive rolex everyone, Oh my god, it's just kidding. Yeah. 523 00:22:37,760 --> 00:22:41,920 Speaker 2: Uh, something else that's skyrocketing and price a lottery tickets. 524 00:22:42,240 --> 00:22:45,359 Speaker 2: Those are going to cost more starting in April. So 525 00:22:45,359 --> 00:22:48,520 Speaker 2: instead of two bucks for your mega million's ticket, it's 526 00:22:48,560 --> 00:22:50,880 Speaker 2: not gonna cost five dollars five spot. 527 00:22:50,920 --> 00:22:52,600 Speaker 1: I feel steep feels a lot, yeah, a lot more 528 00:22:52,600 --> 00:22:54,240 Speaker 1: expensive two dollars. It's just like, oh, you got a 529 00:22:54,240 --> 00:22:56,080 Speaker 1: couple ones laying around, Well, I was gonna end up 530 00:22:56,080 --> 00:22:58,480 Speaker 1: losing those anyway, right, right, But now you're. 531 00:22:58,320 --> 00:23:01,080 Speaker 2: Like, you'll lose file five dollars five And of course 532 00:23:01,080 --> 00:23:04,240 Speaker 2: there's gonna be more winners, there's gonna be bigger prizes. Still, 533 00:23:04,400 --> 00:23:07,080 Speaker 2: your odds of winning are truly going to be abysmal. 534 00:23:07,520 --> 00:23:09,560 Speaker 2: And your once a week habit, which is akin to 535 00:23:09,560 --> 00:23:12,200 Speaker 2: tossing money in the garbage, which might have been cute 536 00:23:12,240 --> 00:23:14,480 Speaker 2: at two dollars, now at five bucks. I think it 537 00:23:14,520 --> 00:23:17,600 Speaker 2: deserves more serious line of questioning. Twenty bucks a month 538 00:23:17,640 --> 00:23:19,480 Speaker 2: matt for the average person, I get, I think, and 539 00:23:19,480 --> 00:23:21,280 Speaker 2: I think the average lottery player spends a whole lot 540 00:23:21,280 --> 00:23:23,120 Speaker 2: more than that already, and if the price goes up, 541 00:23:23,480 --> 00:23:25,960 Speaker 2: you know they might be dropping like one hundred dollars 542 00:23:26,080 --> 00:23:28,840 Speaker 2: or more a month. That can especially when you think 543 00:23:28,840 --> 00:23:31,440 Speaker 2: about the compounding realities of that money going to work 544 00:23:31,480 --> 00:23:34,000 Speaker 2: for you in retirement accounts. That money could do a 545 00:23:34,040 --> 00:23:36,080 Speaker 2: whole lot on your behalf. And I don't know, maybe 546 00:23:36,119 --> 00:23:37,840 Speaker 2: all of us in the how of money community, maybe 547 00:23:37,840 --> 00:23:41,600 Speaker 2: we can simultaneously commit to avoiding lottery tickets and luxury 548 00:23:41,640 --> 00:23:42,720 Speaker 2: goods at the same time. 549 00:23:43,440 --> 00:23:46,360 Speaker 1: What if, yeah, what if lottery tickets are somebody's craft 550 00:23:46,400 --> 00:23:48,760 Speaker 1: beer equivalent. Oh, I don't know. I don't know if 551 00:23:48,760 --> 00:23:52,080 Speaker 1: you can justify that as I think you can anything, 552 00:23:52,160 --> 00:23:53,879 Speaker 1: right Like, That's why it's so hard for us to 553 00:23:54,240 --> 00:23:55,720 Speaker 1: knock on stuff, which is part of it. 554 00:23:55,720 --> 00:23:58,600 Speaker 2: Why but most people do it out of habit, or 555 00:23:58,600 --> 00:24:00,879 Speaker 2: they do it out of hope, and they're doing it 556 00:24:00,880 --> 00:24:03,200 Speaker 2: because they're I don't know, they think that, yeah, they 557 00:24:03,240 --> 00:24:05,879 Speaker 2: need the big time payout. They can't they can't be 558 00:24:06,000 --> 00:24:08,160 Speaker 2: patient and wait for thirty or forty years to build 559 00:24:08,200 --> 00:24:10,160 Speaker 2: that wealth. But that's really the tried and true way 560 00:24:10,200 --> 00:24:10,480 Speaker 2: to do it. 561 00:24:10,520 --> 00:24:13,080 Speaker 1: And that's a muscle worth developing. Yeah, I hate that. 562 00:24:13,119 --> 00:24:15,560 Speaker 1: It's more of a reflexive action for a lot of folks, 563 00:24:15,600 --> 00:24:18,480 Speaker 1: and that's when folks are mindlessly sort of losing their money. 564 00:24:18,680 --> 00:24:20,639 Speaker 1: There's a big difference between that and like, I don't know, 565 00:24:20,680 --> 00:24:23,640 Speaker 1: twice a year being like, hey, every year I take 566 00:24:23,640 --> 00:24:25,320 Speaker 1: my tax return and I use two dollars of that 567 00:24:25,320 --> 00:24:26,600 Speaker 1: to buy a lot of ticket. Like I don't know 568 00:24:26,640 --> 00:24:28,640 Speaker 1: if it's like a tradition or or maybe like well 569 00:24:28,680 --> 00:24:31,200 Speaker 1: we always stick one lottery ticket in Christmas stocking or 570 00:24:31,240 --> 00:24:33,399 Speaker 1: something like that. There's a big difference between that and 571 00:24:33,480 --> 00:24:36,080 Speaker 1: like reflexively going every week on you know, Friday afternoon 572 00:24:36,160 --> 00:24:39,520 Speaker 1: exactly that kind of thing. So, speaking of prices, Joel, 573 00:24:39,640 --> 00:24:41,719 Speaker 1: so was it last week we talked about tattoos how 574 00:24:41,760 --> 00:24:43,760 Speaker 1: much they cost? Like I joked about getting an experience 575 00:24:43,800 --> 00:24:46,880 Speaker 1: tattoo on that experience New York Times. I think they 576 00:24:47,160 --> 00:24:49,280 Speaker 1: heard us talking about that. They just had an article 577 00:24:49,440 --> 00:24:53,520 Speaker 1: about how expensive tattoos have gotten. The global tattoo market 578 00:24:53,560 --> 00:24:56,919 Speaker 1: is two point two billion dollars. I had no idea 579 00:24:56,920 --> 00:24:59,480 Speaker 1: that it was that big of an industry and more 580 00:24:59,520 --> 00:25:02,960 Speaker 1: America are paying big money to make their body a 581 00:25:03,000 --> 00:25:06,000 Speaker 1: living work of art, and I can appreciate that. I 582 00:25:06,040 --> 00:25:08,800 Speaker 1: can I understand folks who are into that. My wife 583 00:25:08,800 --> 00:25:10,560 Speaker 1: wants to get attended. Does she really does what she 584 00:25:10,600 --> 00:25:14,119 Speaker 1: want to get? Does she know like a wave somewhere? Yeah? Oh? 585 00:25:14,359 --> 00:25:18,040 Speaker 1: Be the way? Is there like a counseling thing? A 586 00:25:18,080 --> 00:25:19,879 Speaker 1: question I need? I need to take it a little bit. 587 00:25:19,880 --> 00:25:22,320 Speaker 1: Didn't ask her why she thought it looked cool. I 588 00:25:22,359 --> 00:25:24,639 Speaker 1: thought she's like the beach. Yeah, but she's not like 589 00:25:24,680 --> 00:25:26,800 Speaker 1: obsessed with the beach. If you're obsessed with the beach, 590 00:25:26,800 --> 00:25:29,720 Speaker 1: that's when you get like, yeah, I don't Yeah, maybe 591 00:25:29,760 --> 00:25:32,840 Speaker 1: it's like a go with the flow. Oh okay, yeah. 592 00:25:32,960 --> 00:25:34,640 Speaker 1: I can't believe you haven't asked her why she was away. 593 00:25:34,640 --> 00:25:37,480 Speaker 1: I didn't ask her. Now now I feel dumb. What 594 00:25:37,560 --> 00:25:39,199 Speaker 1: if you're like, I want to get a tattoo and 595 00:25:39,200 --> 00:25:41,320 Speaker 1: you're like, I want to get a sunflower on my 596 00:25:41,320 --> 00:25:44,560 Speaker 1: forearm when you let her to ask you? Why? Be 597 00:25:44,600 --> 00:25:46,960 Speaker 1: Based on that Postmalon song, Yeah, it's a good song. 598 00:25:47,320 --> 00:25:49,000 Speaker 1: I think it's just worth putting this out there because 599 00:25:49,000 --> 00:25:51,880 Speaker 1: that you know, We've all seen friends get tattoos that 600 00:25:51,960 --> 00:25:54,400 Speaker 1: to them represented something meaningful at that point in time, 601 00:25:54,440 --> 00:25:57,119 Speaker 1: but then they end up loathing the ink that you 602 00:25:57,160 --> 00:26:00,480 Speaker 1: know they adored just a few years earlier. Big money 603 00:26:00,480 --> 00:26:02,960 Speaker 1: on the because then you've got, you know, not just 604 00:26:03,000 --> 00:26:04,960 Speaker 1: the cost involved with getting a tattoo, that's one thing, 605 00:26:05,680 --> 00:26:08,359 Speaker 1: a couple hundred per hour, but then the time the 606 00:26:08,440 --> 00:26:11,919 Speaker 1: cost to remove the tattoo that is also worth considering 607 00:26:11,960 --> 00:26:13,720 Speaker 1: as well. You got to think about if you don't 608 00:26:13,800 --> 00:26:18,120 Speaker 1: end up loving that tattoo and the tattoo removal part 609 00:26:18,160 --> 00:26:20,800 Speaker 1: of the industry that's actually one third of the tattoo 610 00:26:20,880 --> 00:26:23,520 Speaker 1: market these days. I have a buddy who's so fascinated, 611 00:26:23,520 --> 00:26:25,600 Speaker 1: who is obsessed with Lord of the Rings, and he's 612 00:26:25,640 --> 00:26:28,159 Speaker 1: covering up some of his old tattoos because he, I 613 00:26:28,160 --> 00:26:30,399 Speaker 1: guess doesn't like them or doesn't feel like they represent 614 00:26:30,480 --> 00:26:32,080 Speaker 1: him in the same way anymore. So he's getting these 615 00:26:32,080 --> 00:26:34,480 Speaker 1: massive Thord of the Rings scenes over the top of 616 00:26:34,480 --> 00:26:36,199 Speaker 1: those old tattoos. And I think that's something else people do. 617 00:26:36,200 --> 00:26:38,879 Speaker 1: They either got him removed giant Gollum on those ye 618 00:26:39,800 --> 00:26:40,560 Speaker 1: is it? Is it? 619 00:26:40,560 --> 00:26:43,600 Speaker 2: Pete Davidson from Saturday Night Live that like has gotten 620 00:26:43,720 --> 00:26:46,320 Speaker 2: has spent a ton of money getting tattoos removed they 621 00:26:46,400 --> 00:26:48,359 Speaker 2: got earlier on in life. So this is one of 622 00:26:48,440 --> 00:26:50,240 Speaker 2: the things with me. We're like, think long and hard. 623 00:26:50,240 --> 00:26:52,439 Speaker 2: I guess before you get the body art. Tattoos can 624 00:26:52,440 --> 00:26:54,920 Speaker 2: be super cool and I just have never. 625 00:26:54,800 --> 00:26:57,360 Speaker 1: Had tattoos more expensive than you think. 626 00:26:58,280 --> 00:27:00,880 Speaker 2: Well, I just think, I like, I've never been able 627 00:27:00,920 --> 00:27:04,840 Speaker 2: to find something that I'm like, I'm almost positive I'm 628 00:27:04,840 --> 00:27:07,040 Speaker 2: gonna love that for the rest of my life. Can't 629 00:27:07,040 --> 00:27:09,360 Speaker 2: wait when I'm eighty two to look down at that thing. Yeah, 630 00:27:09,520 --> 00:27:11,920 Speaker 2: that wrinkled tattoo, that's that's at enjoy it. 631 00:27:12,080 --> 00:27:14,600 Speaker 1: Like. There are very few things in my life where 632 00:27:14,680 --> 00:27:17,560 Speaker 1: that I feel that resolute and where I trust myself 633 00:27:17,560 --> 00:27:20,479 Speaker 1: to be that steadfast like years and years. Like family 634 00:27:20,560 --> 00:27:22,439 Speaker 1: is one, and so you know, I could see myself. 635 00:27:22,440 --> 00:27:24,120 Speaker 2: That was the one thing I thought about getting really 636 00:27:24,160 --> 00:27:27,280 Speaker 2: some sort of like Shuonish version of my family, like 637 00:27:27,440 --> 00:27:30,480 Speaker 2: tattooed on caricature of your whole fa one of my 638 00:27:30,480 --> 00:27:34,399 Speaker 2: favorite artists representation of my family. But I just haven't. 639 00:27:35,040 --> 00:27:37,199 Speaker 2: I just haven't been able to make that plunge get 640 00:27:37,240 --> 00:27:38,880 Speaker 2: you a black cat tips, That's what I was taking. 641 00:27:39,040 --> 00:27:41,280 Speaker 2: Version of everyone yes, exactly. 642 00:27:41,640 --> 00:27:42,160 Speaker 1: That could be cool. 643 00:27:42,359 --> 00:27:44,720 Speaker 2: It could be, but I still probably won't do it. 644 00:27:44,920 --> 00:27:47,280 Speaker 2: So yeah, get body art if you're into it, but 645 00:27:47,400 --> 00:27:49,720 Speaker 2: just make sure you actually are sure you want it, 646 00:27:49,760 --> 00:27:51,879 Speaker 2: because it can be expensive to put on and to 647 00:27:51,920 --> 00:27:54,359 Speaker 2: take off. Now, let's talk about real estate for a second. 648 00:27:54,320 --> 00:27:57,240 Speaker 2: As prices go up, at some point, consumer stop buying, right, 649 00:27:57,240 --> 00:27:58,880 Speaker 2: I think, go on buyer strike. They say it's it's 650 00:27:58,920 --> 00:28:01,879 Speaker 2: too much. I'm backing out of the market. And we 651 00:28:01,920 --> 00:28:04,639 Speaker 2: know this too. What goes up at an unsustainable pace 652 00:28:05,080 --> 00:28:07,200 Speaker 2: must eventually chill out and come back down to earth, 653 00:28:07,200 --> 00:28:09,080 Speaker 2: and that is what's happening in certain parts of the 654 00:28:09,119 --> 00:28:12,240 Speaker 2: real estate market. Florida, for instance, was red hot for 655 00:28:12,400 --> 00:28:15,240 Speaker 2: years more than the rest of the country, but the 656 00:28:15,320 --> 00:28:18,120 Speaker 2: Florida market seems to be calming down quite a bit. 657 00:28:18,640 --> 00:28:21,919 Speaker 2: I think this is partly thanks to recent violent storms, 658 00:28:22,000 --> 00:28:25,000 Speaker 2: rising home insurance costs, and price fatigue, but I think 659 00:28:25,040 --> 00:28:27,640 Speaker 2: price fatigue started before some of this other stuff too. 660 00:28:28,119 --> 00:28:31,560 Speaker 2: Those factors have all combined to just reduced interest in 661 00:28:31,560 --> 00:28:35,560 Speaker 2: Florida real estate in general. And so this is bad news, 662 00:28:35,600 --> 00:28:37,639 Speaker 2: I guess if you own a home in Florida. But 663 00:28:37,720 --> 00:28:39,600 Speaker 2: it's good news for want to be home buyers. And 664 00:28:39,600 --> 00:28:43,720 Speaker 2: I think this is extending past just Florida specifically too. 665 00:28:43,760 --> 00:28:46,840 Speaker 2: I mean, we went through a stretch of rapidly increasing prices, 666 00:28:47,040 --> 00:28:50,040 Speaker 2: multiple offers on every home home sales going for one 667 00:28:50,080 --> 00:28:52,760 Speaker 2: hundred thousand dollars more than what the asking price was, 668 00:28:53,320 --> 00:28:56,360 Speaker 2: and then asking prices jumping conventionally too. But just like 669 00:28:56,400 --> 00:28:59,320 Speaker 2: prices in many other parts of the economy, the housing 670 00:28:59,360 --> 00:29:01,960 Speaker 2: market is more normalizing. So it just feels like we're 671 00:29:01,960 --> 00:29:05,480 Speaker 2: living in a more normal American economy right now than 672 00:29:05,520 --> 00:29:06,840 Speaker 2: we were a couple of years ago. 673 00:29:07,120 --> 00:29:09,440 Speaker 1: And that's just a nice change, that's true. Yeah, so 674 00:29:09,560 --> 00:29:12,239 Speaker 1: if you already own a home and recently purchased it, 675 00:29:12,320 --> 00:29:15,600 Speaker 1: you might love the home, but not the rate. That 676 00:29:15,640 --> 00:29:18,040 Speaker 1: was actually a term that was gaining popularity. Was it 677 00:29:18,080 --> 00:29:20,000 Speaker 1: last year a couple of years ago. Marry the home, 678 00:29:20,160 --> 00:29:22,480 Speaker 1: date the rate. Yeah, we crapped on that a lot. 679 00:29:22,560 --> 00:29:25,600 Speaker 2: Yeah, we hate on realtors a lot, don't we, Joel, Well, no, no, 680 00:29:25,600 --> 00:29:28,160 Speaker 2: we talked. That was about that was about refinancing, and 681 00:29:28,440 --> 00:29:30,320 Speaker 2: they were saying, oh, listen, buy the home and guess 682 00:29:30,320 --> 00:29:32,080 Speaker 2: what you don't like the rate, you can refinance like 683 00:29:32,120 --> 00:29:32,960 Speaker 2: six months down the road. 684 00:29:33,080 --> 00:29:35,360 Speaker 1: That was like, yeah, and look where ray. Traditionally that 685 00:29:35,480 --> 00:29:37,680 Speaker 1: was a realtor rallying cry to be like, no, you 686 00:29:37,720 --> 00:29:40,280 Speaker 1: can still buy the home, like this is only temporary. Yeah, 687 00:29:40,320 --> 00:29:43,560 Speaker 1: but and look at rates. Yeah, they're still not doing great. 688 00:29:43,720 --> 00:29:46,160 Speaker 1: They did. Friend of the Show, Michelle Singletary. She wrote 689 00:29:46,280 --> 00:29:48,800 Speaker 1: in an article in The Washington Post about how you 690 00:29:48,840 --> 00:29:51,520 Speaker 1: actually don't have to refinance to reduce what you pay 691 00:29:51,600 --> 00:29:55,520 Speaker 1: an interest. She didn't suggest refinancing, because again, rates haven't 692 00:29:55,560 --> 00:29:59,280 Speaker 1: dropped enough to make that a smart idea for almost anyone. Instead, 693 00:29:59,400 --> 00:30:03,400 Speaker 1: she was pointed to paying extra towards your principal balance. 694 00:30:04,000 --> 00:30:06,880 Speaker 1: So this is a classic suggestion, And yes, it it's 695 00:30:06,920 --> 00:30:09,000 Speaker 1: going to reduce the overall amount of interest that you're 696 00:30:09,040 --> 00:30:12,080 Speaker 1: going to pay over the life of the loan because 697 00:30:12,120 --> 00:30:14,280 Speaker 1: specifically of the fact that you're going to reduce your 698 00:30:14,280 --> 00:30:17,640 Speaker 1: payoff timeline. But that doesn't mean that you should start 699 00:30:17,640 --> 00:30:20,640 Speaker 1: funneling more money towards your mortgage. If let's say you 700 00:30:20,680 --> 00:30:23,840 Speaker 1: are investing, let's say you're saving like a baller, Yeah, 701 00:30:23,880 --> 00:30:26,120 Speaker 1: maybe that's something you can consider, But we don't think 702 00:30:26,400 --> 00:30:29,640 Speaker 1: that you should prioritize a mortgage payoff if it means 703 00:30:29,720 --> 00:30:32,680 Speaker 1: not achieving the other goals. In your life and the 704 00:30:33,280 --> 00:30:37,640 Speaker 1: biggest So again, by paying towards your principal balance, yes, 705 00:30:37,880 --> 00:30:41,280 Speaker 1: you are going to eliminate that mortgage like seven years sooner. Right, 706 00:30:41,280 --> 00:30:42,760 Speaker 1: This is the two Like, what is that if you 707 00:30:42,760 --> 00:30:45,280 Speaker 1: pay twice two extra payments every single year. I think 708 00:30:45,280 --> 00:30:47,120 Speaker 1: it's something like you're taking it from a thirty year 709 00:30:47,120 --> 00:30:49,920 Speaker 1: mortgage down to a twenty three your mortgage bi weekly, 710 00:30:49,960 --> 00:30:52,160 Speaker 1: that's what you're doing. Yeah, extra payment a year exactly, 711 00:30:52,200 --> 00:30:55,240 Speaker 1: that's right. But guess what, you're not realizing that benefit 712 00:30:55,320 --> 00:30:57,959 Speaker 1: until the twenty years down the line. And so if 713 00:30:57,960 --> 00:30:59,800 Speaker 1: you're thinking that this is some way that you're going 714 00:30:59,840 --> 00:31:01,360 Speaker 1: to be able to reduce what it is that you're 715 00:31:01,360 --> 00:31:03,840 Speaker 1: paying every single month towards your mortgage, No, you're not 716 00:31:03,880 --> 00:31:07,080 Speaker 1: reducing your monthly cash flow that's going that's leaving your 717 00:31:07,120 --> 00:31:10,520 Speaker 1: bank account. This is this is a forced method of savings. 718 00:31:10,800 --> 00:31:13,720 Speaker 1: And to actually realize a reduced payment at some point, 719 00:31:13,720 --> 00:31:16,200 Speaker 1: what you would have to do is, yes, either refinance, 720 00:31:16,520 --> 00:31:18,880 Speaker 1: hoping that rates are going to come down. But the 721 00:31:18,920 --> 00:31:22,520 Speaker 1: problem here though, refinancing is pretty expensive, and so the 722 00:31:22,560 --> 00:31:25,080 Speaker 1: other alternative is to see if you can get your 723 00:31:25,080 --> 00:31:30,240 Speaker 1: mortgage recast, which is where the lender reamateurizes your payment 724 00:31:30,240 --> 00:31:33,239 Speaker 1: schedule based on the principal balance that is remaining. But 725 00:31:33,280 --> 00:31:35,600 Speaker 1: that guess what, that also costs money too, so that 726 00:31:35,640 --> 00:31:37,520 Speaker 1: there's no like sort of cost less than refining. It 727 00:31:37,600 --> 00:31:40,360 Speaker 1: costs less, but there's no free lunch here, And so instead, 728 00:31:40,400 --> 00:31:44,480 Speaker 1: we would much rather see folks avoid adopting the mindset 729 00:31:44,560 --> 00:31:46,880 Speaker 1: of oh, I hate debt, and instead, if hey, if 730 00:31:46,880 --> 00:31:48,400 Speaker 1: you want to save a bunch, sock that money into 731 00:31:48,400 --> 00:31:51,280 Speaker 1: your savings account, find different ways of investing that money. 732 00:31:51,320 --> 00:31:53,880 Speaker 1: But paying your mortgage early is typically not something that 733 00:31:53,920 --> 00:31:55,200 Speaker 1: we can that we like to get behind. 734 00:31:55,240 --> 00:31:58,000 Speaker 2: You should hate most debt, but mortgage debt is the 735 00:31:58,560 --> 00:32:01,440 Speaker 2: exception to the rule. I think that like most debt 736 00:32:01,480 --> 00:32:03,280 Speaker 2: that people call in and ask us about matt, we're like, 737 00:32:03,320 --> 00:32:05,640 Speaker 2: get rid of it as soon as possible. Mortgage debt, though, 738 00:32:05,680 --> 00:32:07,840 Speaker 2: is one of those that we say, oh, actually, there's 739 00:32:07,840 --> 00:32:09,040 Speaker 2: a bunch of other things you could do with this, 740 00:32:09,120 --> 00:32:13,000 Speaker 2: And in fact, there's certain benefits to having extra liquid 741 00:32:13,040 --> 00:32:16,160 Speaker 2: cash on hand right That gives you a lot more freedom, 742 00:32:16,160 --> 00:32:19,440 Speaker 2: more flexibility, and so we'd likely rather see you invest 743 00:32:19,480 --> 00:32:22,560 Speaker 2: those dollars, especially if you're earlier on your financial journey, 744 00:32:22,840 --> 00:32:25,320 Speaker 2: do that instead of prioritizing that mortgage payoff. So we 745 00:32:25,360 --> 00:32:28,600 Speaker 2: love Michelle Singletary, just don't. And for some people this 746 00:32:28,680 --> 00:32:31,120 Speaker 2: might be the best move, but it's certainly not for everybody. 747 00:32:31,160 --> 00:32:33,320 Speaker 2: So I think if we're blanket telling everyone get rid 748 00:32:33,360 --> 00:32:35,440 Speaker 2: of your house debt as quickly as possible, you might 749 00:32:35,440 --> 00:32:37,520 Speaker 2: be missing out on other ways to grow your net 750 00:32:37,600 --> 00:32:39,920 Speaker 2: worth instead of just trying to pay down a debt 751 00:32:40,080 --> 00:32:41,760 Speaker 2: that's not actually one of the worst debts you have. 752 00:32:42,320 --> 00:32:45,680 Speaker 2: All right, should you increase your utility budget in preparation 753 00:32:46,040 --> 00:32:49,800 Speaker 2: for higher winter heating prices. It's starting to get cold, Matt. 754 00:32:49,800 --> 00:32:52,360 Speaker 2: We've turned on the heat for the first time recently. 755 00:32:52,520 --> 00:32:54,200 Speaker 1: I love it. Yeah, I love turn on the heat 756 00:32:54,600 --> 00:32:56,040 Speaker 1: drives out there. Well, actually it's not the heat that 757 00:32:56,120 --> 00:32:59,000 Speaker 1: dries out there. It's just lower temperatures carry less humidity. 758 00:32:59,200 --> 00:33:02,200 Speaker 1: And if I talked too much about humidity in the 759 00:33:02,240 --> 00:33:04,480 Speaker 1: air recently, maybe this you could have been a weather 760 00:33:04,520 --> 00:33:07,040 Speaker 1: man and in another life. I find it fascinating. 761 00:33:07,080 --> 00:33:09,440 Speaker 2: Yeah, that's all, and so much of like whether or 762 00:33:09,440 --> 00:33:11,760 Speaker 2: not you're going to encounter higher heating prices this winter, 763 00:33:12,000 --> 00:33:14,200 Speaker 2: it depends on where you live, and it depends on 764 00:33:14,560 --> 00:33:18,920 Speaker 2: where you're getting your information. So CNN basically said, had 765 00:33:18,920 --> 00:33:22,000 Speaker 2: an article saying higher electricity bills are coming this winter, 766 00:33:22,440 --> 00:33:24,000 Speaker 2: and it sounded really scary, But then you read the 767 00:33:24,000 --> 00:33:26,200 Speaker 2: fine print and you're like, it seems like they're not 768 00:33:26,280 --> 00:33:28,440 Speaker 2: going up. They're going up at a slower rate than 769 00:33:28,440 --> 00:33:30,720 Speaker 2: the rate of inflation, for sure. And then the Wall 770 00:33:30,760 --> 00:33:34,400 Speaker 2: Street Journal had an article detailing the abundance of natural gas, 771 00:33:34,640 --> 00:33:37,160 Speaker 2: which is going to lead to lower utility costs for 772 00:33:37,200 --> 00:33:39,080 Speaker 2: a big chunk of folks in the states that use 773 00:33:39,160 --> 00:33:41,520 Speaker 2: natural gas for heating MAP. I don't know about you, 774 00:33:41,560 --> 00:33:44,920 Speaker 2: but my price per therm plummeted when I recently shopped around. 775 00:33:45,200 --> 00:33:46,960 Speaker 2: And so you live, if you live in a state 776 00:33:46,960 --> 00:33:49,840 Speaker 2: with deregulated natural gas, I forget how many there are, 777 00:33:50,440 --> 00:33:53,080 Speaker 2: but shopping around could save you a bundle if you 778 00:33:53,080 --> 00:33:54,600 Speaker 2: just keep paying what you're paying, if you're on the 779 00:33:54,880 --> 00:33:57,120 Speaker 2: if you're not in some sort of locked in rate, Yeah, 780 00:33:57,120 --> 00:33:58,680 Speaker 2: did you get to pay more? Did you get to 781 00:33:58,680 --> 00:34:01,080 Speaker 2: the end of your two year lock basically yeah? 782 00:34:01,120 --> 00:34:04,840 Speaker 1: And so then I love locking in another another chunk 783 00:34:04,840 --> 00:34:06,360 Speaker 1: of time at an even lower rates. 784 00:34:06,480 --> 00:34:09,080 Speaker 2: So much cheaper, so much cheaper this time around. So 785 00:34:09,400 --> 00:34:11,399 Speaker 2: if use heating oil, it's gonna cost you a bit 786 00:34:11,480 --> 00:34:13,640 Speaker 2: more this winter, but still not a whole lot more 787 00:34:13,680 --> 00:34:16,040 Speaker 2: than last year according to the estimates that we've seen. 788 00:34:16,880 --> 00:34:19,480 Speaker 2: But ultimately how much you spend depends less on rising 789 00:34:19,520 --> 00:34:22,239 Speaker 2: prices at least in this current environment, and more on 790 00:34:22,280 --> 00:34:24,600 Speaker 2: a combination of the weather. Because if it's super duper 791 00:34:24,640 --> 00:34:26,120 Speaker 2: cold where you live, like you're gonna need to use 792 00:34:26,160 --> 00:34:28,840 Speaker 2: more energy to heat your home. And then where you 793 00:34:28,840 --> 00:34:31,239 Speaker 2: set thermostat, Matt, I think something people don't think about 794 00:34:31,239 --> 00:34:33,120 Speaker 2: a whole lot and might sound cheap to some folks, 795 00:34:33,520 --> 00:34:35,280 Speaker 2: sounds cheap to my kids, I think lots of times. 796 00:34:35,480 --> 00:34:38,640 Speaker 2: But the lower you set that thermostat, hopefully without you know, 797 00:34:38,680 --> 00:34:41,439 Speaker 2: make your fingers and your extremities go numb. But that's 798 00:34:41,480 --> 00:34:43,480 Speaker 2: gonna that's gonna help you save a bundle on heating too. 799 00:34:43,600 --> 00:34:46,759 Speaker 1: Just put some clothes on and we practice turn it 800 00:34:46,760 --> 00:34:48,120 Speaker 1: down a few degrees when you leave the house to 801 00:34:48,160 --> 00:34:49,839 Speaker 1: go to work too. We practice what we preach. We're 802 00:34:49,880 --> 00:34:52,319 Speaker 1: sitting here, you are wearing a cozy hoodie. I am 803 00:34:52,360 --> 00:34:55,680 Speaker 1: wearing a little Patagoia puff puffer jacket, and that's what's 804 00:34:55,719 --> 00:34:58,040 Speaker 1: keeping our heat pump from having to blast, which costs 805 00:34:58,080 --> 00:34:59,880 Speaker 1: us money. Right, But that's gonna be it for the 806 00:35:00,040 --> 00:35:03,040 Speaker 1: US Friday flight. We hope everyone has a fantastic weekend. 807 00:35:03,080 --> 00:35:05,480 Speaker 1: We will link to the different stories that we mentioned 808 00:35:05,600 --> 00:35:08,400 Speaker 1: during this episode up in our show notes at howdomoney 809 00:35:08,440 --> 00:35:10,480 Speaker 1: dot com. So buddy, hope you have a good one. 810 00:35:10,600 --> 00:35:13,800 Speaker 1: Until next time, best Friends Out, Best Friends Out,