1 00:00:00,120 --> 00:00:02,800 Speaker 1: Welcome to How the Money. I'm Joel and I am Matt, 2 00:00:02,880 --> 00:00:24,840 Speaker 1: and today we are answering your listener questions. Yeah, Joel, 3 00:00:24,840 --> 00:00:27,120 Speaker 1: it's one of these every other Mondays, which means it's 4 00:00:27,120 --> 00:00:29,680 Speaker 1: time for and ask how to Money? Man. This is 5 00:00:29,720 --> 00:00:32,120 Speaker 1: where we take listener questions. We've got five listener questions 6 00:00:32,120 --> 00:00:34,680 Speaker 1: on the docket, including we've got a listener who is 7 00:00:34,920 --> 00:00:36,960 Speaker 1: he's got some questions about buying a house, whether they 8 00:00:37,000 --> 00:00:38,960 Speaker 1: should go ahead and pull the trigger on purchasing a 9 00:00:39,000 --> 00:00:41,920 Speaker 1: home or should they wait. We're gonna take a question 10 00:00:41,960 --> 00:00:45,159 Speaker 1: about joint brokerage accounts from a couple in Maine. And 11 00:00:45,159 --> 00:00:48,400 Speaker 1: we're also taking a question about credit card rewards, whether 12 00:00:48,640 --> 00:00:51,040 Speaker 1: it makes sense to you know, look towards the cash 13 00:00:51,080 --> 00:00:53,000 Speaker 1: back if you're gonna get the cash, or if it 14 00:00:53,000 --> 00:00:56,720 Speaker 1: makes sense to focus on travel rewards, specifically airline miles 15 00:00:56,760 --> 00:00:59,400 Speaker 1: and some of those different points that cards offer. We're 16 00:00:59,400 --> 00:01:01,680 Speaker 1: gonna get to those questions man, plus two others during 17 00:01:01,680 --> 00:01:03,960 Speaker 1: this episode. Looking forward to it, Man, And it's always 18 00:01:03,960 --> 00:01:07,479 Speaker 1: our Our listeners have just really interesting questions, and I'm 19 00:01:07,520 --> 00:01:10,520 Speaker 1: thankful that they entrust us to, you know, toss our 20 00:01:10,560 --> 00:01:12,600 Speaker 1: input their way. So yeah, it should be a phone 21 00:01:12,640 --> 00:01:14,720 Speaker 1: today now, absolutely, man. But before we get to those questions, 22 00:01:14,760 --> 00:01:17,440 Speaker 1: I wanted to talk to you about a little money. 23 00:01:17,760 --> 00:01:20,959 Speaker 1: I guess that consumer tip that I bring it learned recently. 24 00:01:21,080 --> 00:01:23,960 Speaker 1: So here in our household, we like to cook. We 25 00:01:24,000 --> 00:01:26,160 Speaker 1: cook a lot in our house, which means we are 26 00:01:26,240 --> 00:01:29,679 Speaker 1: really dependent on our range hood in order to maintain 27 00:01:29,800 --> 00:01:31,320 Speaker 1: the air quality in our house, keep it nice and 28 00:01:31,440 --> 00:01:33,800 Speaker 1: fresh and crisp. Well, one of the bulbs, we've got 29 00:01:33,880 --> 00:01:36,000 Speaker 1: two really bright bulbs that shine down from it, and 30 00:01:36,040 --> 00:01:38,480 Speaker 1: one of them went out, which again doesn't seem like 31 00:01:38,520 --> 00:01:39,840 Speaker 1: that big of a deal, but for us, it's a 32 00:01:39,920 --> 00:01:43,200 Speaker 1: huge dinking deal, it's a huge deal. I looked up 33 00:01:43,280 --> 00:01:45,520 Speaker 1: the range model number, and my guess is they don't 34 00:01:45,560 --> 00:01:48,240 Speaker 1: take the normal six white light bulbs exactly. It's like 35 00:01:48,320 --> 00:01:50,280 Speaker 1: one of those specialty kind of bulbs, you know. And 36 00:01:50,360 --> 00:01:52,800 Speaker 1: so for that reason, I looked up the like the 37 00:01:52,880 --> 00:01:55,040 Speaker 1: serial number, the model number of the of the range 38 00:01:55,480 --> 00:01:58,440 Speaker 1: to look up a replacement bulbs specifically for that range. 39 00:01:58,520 --> 00:02:00,840 Speaker 1: And so I went to a few different part websites, 40 00:02:00,880 --> 00:02:03,520 Speaker 1: you know that specialize in appliance parts, you know, replacement 41 00:02:03,640 --> 00:02:05,440 Speaker 1: parts that are like O E. M. You know, like 42 00:02:05,480 --> 00:02:08,400 Speaker 1: they're the legit, you know, from the manufacturer. They're like 43 00:02:08,480 --> 00:02:10,120 Speaker 1: the name brand or whatever. And how much does a 44 00:02:10,200 --> 00:02:13,400 Speaker 1: light bulb cause at least twenty do I want to 45 00:02:13,440 --> 00:02:15,880 Speaker 1: a few of these different sites, and twenty dollars was 46 00:02:15,960 --> 00:02:17,400 Speaker 1: the best price I could find, and I think that 47 00:02:17,440 --> 00:02:19,720 Speaker 1: didn't include shipping either. And I was just like, you know, 48 00:02:19,840 --> 00:02:21,960 Speaker 1: a one hand like part of me wanted to kind 49 00:02:21,960 --> 00:02:24,160 Speaker 1: of go the easy route. And what I was kind 50 00:02:24,200 --> 00:02:26,519 Speaker 1: of the excuse I was telling myself was that, Okay, no, 51 00:02:26,760 --> 00:02:29,040 Speaker 1: it's not just the easy route. This is the official route. 52 00:02:29,080 --> 00:02:31,480 Speaker 1: You know, I want to get the actual manufacturers part, 53 00:02:31,600 --> 00:02:33,919 Speaker 1: like I want the part that was made for this range. 54 00:02:34,440 --> 00:02:36,120 Speaker 1: But then the other the frugal side of me, it 55 00:02:36,200 --> 00:02:38,680 Speaker 1: was just like twenty bucks for a ball, man, it's 56 00:02:38,720 --> 00:02:41,760 Speaker 1: just too much money. I found this chart that basically 57 00:02:42,200 --> 00:02:44,040 Speaker 1: I was able to identify on this chart what kind 58 00:02:44,080 --> 00:02:46,120 Speaker 1: of bulb this thing is, because you know, they've got 59 00:02:46,160 --> 00:02:48,920 Speaker 1: like these weird like T four or you know, G nine, 60 00:02:49,320 --> 00:02:51,160 Speaker 1: like all these kind of different weird codes. All right, 61 00:02:51,160 --> 00:02:53,959 Speaker 1: it sounds like all the random circular batteries that you 62 00:02:54,000 --> 00:02:56,600 Speaker 1: could put in a watch, like a million different physically, 63 00:02:56,639 --> 00:02:58,639 Speaker 1: it's it's like that. But the thing is once you 64 00:02:58,680 --> 00:03:01,440 Speaker 1: can identify which bulb you have or which bull you 65 00:03:01,520 --> 00:03:04,639 Speaker 1: need on this chart, then you can easily search not 66 00:03:04,800 --> 00:03:06,799 Speaker 1: by the part number, but you can search by that 67 00:03:06,880 --> 00:03:08,720 Speaker 1: type of bulb. And so I think in my case 68 00:03:08,760 --> 00:03:10,919 Speaker 1: it was I think was G nine, but it was 69 00:03:10,960 --> 00:03:14,119 Speaker 1: like this buy pin bulb, you know, like a loop 70 00:03:14,200 --> 00:03:16,799 Speaker 1: pin kind of specialty bulb thing. So once I was 71 00:03:16,840 --> 00:03:18,280 Speaker 1: able to find that, I was able to hop on 72 00:03:18,280 --> 00:03:21,320 Speaker 1: Amazon search that specific bulb with the wattage I needed. 73 00:03:21,400 --> 00:03:23,880 Speaker 1: And dude, instead of finding one bulb for twenty bucks, 74 00:03:24,040 --> 00:03:29,160 Speaker 1: I was able to get ten bulbs for eight dollars. Nothing. 75 00:03:29,160 --> 00:03:31,760 Speaker 1: You'll use ten bulbs probably within your lifetime, but maybe 76 00:03:31,840 --> 00:03:33,280 Speaker 1: I don't know. I'll store them away. We've got like 77 00:03:33,320 --> 00:03:35,280 Speaker 1: a special light bulb box, you know, that's where we 78 00:03:35,360 --> 00:03:37,520 Speaker 1: keep all the light bulbs. And for the other nine 79 00:03:37,600 --> 00:03:39,400 Speaker 1: that I'm not going to use, I wrote on that bag, 80 00:03:39,520 --> 00:03:42,280 Speaker 1: you know, rainshood bulbs. But I just wanted to throw 81 00:03:42,320 --> 00:03:44,840 Speaker 1: that out there for folks that you know, I was 82 00:03:44,960 --> 00:03:47,200 Speaker 1: going to take the easy route, right, I was just 83 00:03:47,240 --> 00:03:49,600 Speaker 1: gonna hop on order from where I knew that I 84 00:03:49,680 --> 00:03:52,760 Speaker 1: could get the official bulb. But with five minutes of 85 00:03:52,840 --> 00:03:54,800 Speaker 1: digging around on the Internet. I was able to educate 86 00:03:54,840 --> 00:03:57,120 Speaker 1: myself and learn what type of bulb I needed, not 87 00:03:57,320 --> 00:03:59,640 Speaker 1: the model number or part number. I got a deal 88 00:03:59,800 --> 00:04:02,680 Speaker 1: that was twenty times better than the amount I was 89 00:04:02,720 --> 00:04:04,920 Speaker 1: getting ready to pay. I want to put that out 90 00:04:04,920 --> 00:04:07,160 Speaker 1: there as encouragement for folks out there who might be 91 00:04:07,520 --> 00:04:09,600 Speaker 1: in a similar situation. Nice. I like that, and I 92 00:04:09,640 --> 00:04:12,000 Speaker 1: think sometimes in order to save money, I think the 93 00:04:12,040 --> 00:04:13,960 Speaker 1: biggest lesson from this is sometimes you have to be 94 00:04:14,000 --> 00:04:15,920 Speaker 1: willing just to like roll up your sleeves and search 95 00:04:16,000 --> 00:04:19,640 Speaker 1: the internet. You know, like it's spent five minutes on 96 00:04:19,640 --> 00:04:21,880 Speaker 1: the internet, gonna get down in dirty. It just takes 97 00:04:21,960 --> 00:04:24,440 Speaker 1: like going another layer deep, right exactly. And some of us, 98 00:04:24,560 --> 00:04:27,400 Speaker 1: um just really do like we're we're so used to 99 00:04:28,040 --> 00:04:31,040 Speaker 1: the easy solution. We're so used to just taking the 100 00:04:31,120 --> 00:04:34,120 Speaker 1: simplest approach that we can, UM And you know, we're 101 00:04:34,120 --> 00:04:36,680 Speaker 1: advocates of simple. I'm a big fan of simple, but 102 00:04:36,800 --> 00:04:39,360 Speaker 1: this is just, yeah, one extra step that saved you 103 00:04:39,400 --> 00:04:41,400 Speaker 1: a ton of money. And I think for people that 104 00:04:41,560 --> 00:04:43,880 Speaker 1: want to be frugal, right that they want to say 105 00:04:43,920 --> 00:04:47,640 Speaker 1: more money this year, maybe challenge yourself in any little 106 00:04:47,680 --> 00:04:49,919 Speaker 1: way in which you've gotten expended. You're coming up, all right, Well, 107 00:04:49,960 --> 00:04:52,240 Speaker 1: how can I move the needle on this expense? Um, 108 00:04:52,360 --> 00:04:54,360 Speaker 1: there's gotta be a way to go to take one 109 00:04:54,440 --> 00:04:56,640 Speaker 1: level deeper in order to save a few extra bucks. 110 00:04:56,960 --> 00:04:59,440 Speaker 1: So buddy, thanks for sharing your story on that man. Absolutely, 111 00:04:59,520 --> 00:05:01,839 Speaker 1: And you know, I guess another side tip is I'll say, 112 00:05:02,120 --> 00:05:03,640 Speaker 1: like I set a time limit on yourself, you know, 113 00:05:04,120 --> 00:05:06,480 Speaker 1: because I know for me, like it's easy to kind 114 00:05:06,520 --> 00:05:08,360 Speaker 1: of just go down this path of like okay, and 115 00:05:08,400 --> 00:05:10,760 Speaker 1: before I know, I'm spending thirty minutes researching different types 116 00:05:10,800 --> 00:05:12,440 Speaker 1: of bulbs, and it would have maybe have been worth 117 00:05:12,480 --> 00:05:14,640 Speaker 1: it for me to spend twenty bucks if I'm spending 118 00:05:15,120 --> 00:05:17,440 Speaker 1: maybe two hours and I'm like, where did my night? Well, 119 00:05:17,480 --> 00:05:19,600 Speaker 1: you know, where'd my evening go? Guy got sucked into 120 00:05:19,600 --> 00:05:22,279 Speaker 1: the world of light bulbs. Um. But by spending five 121 00:05:22,400 --> 00:05:24,800 Speaker 1: like maybe I spent two minutes total by the time 122 00:05:24,839 --> 00:05:27,279 Speaker 1: the purchase was all said and done. But yeah, setting 123 00:05:27,279 --> 00:05:29,000 Speaker 1: an actual hard kind of time limb it might be 124 00:05:29,040 --> 00:05:31,279 Speaker 1: a way for folks to rain themselves in a little 125 00:05:31,279 --> 00:05:33,320 Speaker 1: bit as well. Yeah, if you gotta take pt O, 126 00:05:33,760 --> 00:05:36,159 Speaker 1: you know, take time off work, you know, just search 127 00:05:36,480 --> 00:05:38,120 Speaker 1: some light bulbs, it's not gonna be worth not worth 128 00:05:38,160 --> 00:05:40,200 Speaker 1: it at all. Yeah, unless you're gonna lose that PTO 129 00:05:40,360 --> 00:05:42,600 Speaker 1: because you're getting rolled over from last year, and I 130 00:05:42,640 --> 00:05:45,520 Speaker 1: guess the light bulbs are justifiable excuse for that. All right, 131 00:05:45,600 --> 00:05:47,360 Speaker 1: let's get onto the beer that we're having on the 132 00:05:47,400 --> 00:05:50,080 Speaker 1: show today, Matt. This one is by High St Brewing 133 00:05:50,240 --> 00:05:53,000 Speaker 1: and it's called Ancient Feelings. It's a West Coast style. 134 00:05:53,120 --> 00:05:54,840 Speaker 1: I p a looking forward to sharing this one with 135 00:05:54,920 --> 00:05:56,120 Speaker 1: you man and talking about it at the end of 136 00:05:56,160 --> 00:05:57,880 Speaker 1: the episode. But for now, let's get onto the topic 137 00:05:57,920 --> 00:06:00,800 Speaker 1: of hand. Let's answer some listener questions, and if anybody 138 00:06:00,839 --> 00:06:02,839 Speaker 1: out there has a question that they would like Matt 139 00:06:02,920 --> 00:06:06,080 Speaker 1: Nighter tackle on an upcoming episode, just go to how 140 00:06:06,120 --> 00:06:08,839 Speaker 1: to money dot com slash ask. There are simple instructions 141 00:06:08,880 --> 00:06:10,960 Speaker 1: there for you to record a voice memo, send it 142 00:06:11,000 --> 00:06:13,760 Speaker 1: our way, and hopefully we can take yours on the 143 00:06:13,839 --> 00:06:16,240 Speaker 1: next ask HTM episode. But Matt, let's get to the 144 00:06:16,240 --> 00:06:18,400 Speaker 1: first question that we're gonna take today. This one's about 145 00:06:18,400 --> 00:06:21,599 Speaker 1: whether or not they are actually prepared to buy a home. Hey, Jelan, Matt, 146 00:06:21,680 --> 00:06:24,640 Speaker 1: this is Will from Lomeland to California. Thanks for the podcast. 147 00:06:24,960 --> 00:06:27,720 Speaker 1: My fiance just matched into a medical fellowship program in 148 00:06:27,760 --> 00:06:30,280 Speaker 1: Orange County, California, where she'll be working for at least 149 00:06:30,320 --> 00:06:32,720 Speaker 1: the next three years. I've been self employed as a 150 00:06:32,760 --> 00:06:35,960 Speaker 1: CG artist since two thousand nine. We're moving in six 151 00:06:36,040 --> 00:06:38,000 Speaker 1: months and need to decide if it's timed to purchase 152 00:06:38,120 --> 00:06:40,920 Speaker 1: or keep renting. Average home price in Orange County is 153 00:06:41,000 --> 00:06:43,680 Speaker 1: eight hundred thousand dollars. We have a large working dog 154 00:06:43,760 --> 00:06:45,600 Speaker 1: that makes it hard to find rentals, and even if 155 00:06:45,640 --> 00:06:47,320 Speaker 1: we do find a house with a yard to rent 156 00:06:47,360 --> 00:06:49,160 Speaker 1: for the next three years, it'll cost us nearly a 157 00:06:49,240 --> 00:06:52,119 Speaker 1: hundred thousand dollars now. Our combined income is only around 158 00:06:52,160 --> 00:06:54,600 Speaker 1: eighty thousand dollars now because I've been drawing the lowest 159 00:06:54,600 --> 00:06:58,080 Speaker 1: salary i can while letting my business account grow. We're 160 00:06:58,080 --> 00:07:00,360 Speaker 1: in our early thirties and want to put down and 161 00:07:00,440 --> 00:07:02,440 Speaker 1: buy a home, but I'm not sure if we should yet. 162 00:07:02,600 --> 00:07:05,120 Speaker 1: We aren't married yet, as my fiance is taking advantage 163 00:07:05,160 --> 00:07:08,440 Speaker 1: of PSLF for her medical school loans, which uses an 164 00:07:08,520 --> 00:07:11,280 Speaker 1: income based repayment plan, so it's best to keep her 165 00:07:11,320 --> 00:07:14,200 Speaker 1: income low or our combined income low when we do 166 00:07:14,320 --> 00:07:17,160 Speaker 1: get married. Her loans cost around sixty five a month 167 00:07:17,240 --> 00:07:21,600 Speaker 1: now and should be completely forgiven by now. I've got 168 00:07:21,640 --> 00:07:23,480 Speaker 1: the stronger credit score of the two of us at 169 00:07:23,600 --> 00:07:26,360 Speaker 1: eight ten. But I'm self employed and probably seen as 170 00:07:26,440 --> 00:07:29,560 Speaker 1: more of a liability by lenders than my doctor fiance. 171 00:07:30,200 --> 00:07:33,040 Speaker 1: We have access to around forty thou in non retirement 172 00:07:33,080 --> 00:07:35,400 Speaker 1: money as well. Now I feel, based on our income alone, 173 00:07:35,480 --> 00:07:38,000 Speaker 1: now we're not candidates for buying in such an expensive area. 174 00:07:38,120 --> 00:07:41,200 Speaker 1: But on the other hand, by four our household income 175 00:07:41,240 --> 00:07:44,600 Speaker 1: should be north of three dollars. So my question is 176 00:07:44,640 --> 00:07:48,600 Speaker 1: should our future situation affect our purchasing decision now or not? 177 00:07:48,920 --> 00:07:50,760 Speaker 1: If you were in our shoes, would you be looking 178 00:07:51,080 --> 00:07:53,400 Speaker 1: or would you wait for a few more years? Thanks? 179 00:07:53,880 --> 00:07:56,000 Speaker 1: All right, Well, let's go ahead and dive in your question. Man, 180 00:07:56,040 --> 00:07:58,080 Speaker 1: Thank so much for sending that one in. I wanted 181 00:07:58,080 --> 00:08:00,480 Speaker 1: to first touch on the amount that you're gonna be 182 00:08:00,520 --> 00:08:03,640 Speaker 1: spending towards rent. The hundred thousand dollars in rent that 183 00:08:03,720 --> 00:08:06,640 Speaker 1: you'll pay over the upcoming three years is not going 184 00:08:06,720 --> 00:08:08,960 Speaker 1: to be wasted money. That can be the view of 185 00:08:09,040 --> 00:08:10,680 Speaker 1: mini renters who do hope to own a home in 186 00:08:10,720 --> 00:08:13,520 Speaker 1: the near future. They ask themselves the question. They're like, well, 187 00:08:13,560 --> 00:08:15,200 Speaker 1: you know, why would I throw away money when it 188 00:08:15,240 --> 00:08:18,040 Speaker 1: could be going towards the home of my dreams. Right. 189 00:08:18,400 --> 00:08:21,360 Speaker 1: And while I completely understand why they you know, why 190 00:08:21,360 --> 00:08:24,640 Speaker 1: they feel that way, Uh, that isn't what is happening, right. 191 00:08:25,000 --> 00:08:27,800 Speaker 1: Renting provides a roof of your head while you are 192 00:08:27,920 --> 00:08:32,400 Speaker 1: working to get in the financial situation to buy a home. Uh. 193 00:08:32,480 --> 00:08:35,160 Speaker 1: And buying a home doesn't make sense for for everyone, 194 00:08:35,360 --> 00:08:37,360 Speaker 1: you know, um, I think you know, especially in the 195 00:08:37,440 --> 00:08:40,760 Speaker 1: most expensive real estate markets, renting can be the smarter play. 196 00:08:41,160 --> 00:08:44,720 Speaker 1: In particular if you invest the savings uh that you'll 197 00:08:44,720 --> 00:08:47,280 Speaker 1: see grow in the market instead of spending it on 198 00:08:47,520 --> 00:08:49,280 Speaker 1: on a home. And this is coming from somebody who 199 00:08:49,360 --> 00:08:51,720 Speaker 1: loves homes, you know, like I have spent you know, Okay, 200 00:08:51,760 --> 00:08:53,559 Speaker 1: now we spend a good deal on our home. We 201 00:08:53,800 --> 00:08:56,760 Speaker 1: value it. But even still, you know, renting is not 202 00:08:57,200 --> 00:08:59,679 Speaker 1: throwing away your money. It's it's definitely worth getting in 203 00:08:59,720 --> 00:09:02,400 Speaker 1: a to be a more solid financial position before you 204 00:09:02,440 --> 00:09:05,440 Speaker 1: buy that home. Yeah, your multimillion dollar palace is really incredible, 205 00:09:05,480 --> 00:09:09,000 Speaker 1: man kind of saying, um, but yeah, I agree, man. 206 00:09:09,040 --> 00:09:11,839 Speaker 1: I think that is the common trope. And part of 207 00:09:11,920 --> 00:09:13,680 Speaker 1: it is just kind of the culture of this country. 208 00:09:13,760 --> 00:09:16,640 Speaker 1: It's built on homeownership and there's kind of there's kind 209 00:09:16,640 --> 00:09:20,120 Speaker 1: of a cult of homeownership, and so everybody is led 210 00:09:20,160 --> 00:09:23,440 Speaker 1: to believe that homeownership is one of the greatest ideals, 211 00:09:23,679 --> 00:09:26,800 Speaker 1: and homeownership can be a great thing for a lot 212 00:09:26,840 --> 00:09:29,360 Speaker 1: of people if you're ready. Um, but well, it just 213 00:09:29,400 --> 00:09:31,280 Speaker 1: doesn't seem like you're quite ready yet, So let's talk 214 00:09:31,280 --> 00:09:34,000 Speaker 1: about what it would look like to be ready. What 215 00:09:34,160 --> 00:09:36,400 Speaker 1: you said about putting down roots, I think is actually 216 00:09:36,480 --> 00:09:39,360 Speaker 1: one of the best reasons to purchase a home. If 217 00:09:39,400 --> 00:09:41,800 Speaker 1: you plan on staying in the area for seven years 218 00:09:41,920 --> 00:09:45,280 Speaker 1: or longer, buying starts to make more sense. So if 219 00:09:45,360 --> 00:09:48,360 Speaker 1: you can accelerate your savings, maybe you can split the 220 00:09:48,400 --> 00:09:50,679 Speaker 1: difference and rent for just one more year as opposed 221 00:09:50,720 --> 00:09:53,200 Speaker 1: to three more years if you decide to continue running 222 00:09:53,240 --> 00:09:55,240 Speaker 1: for the time being. It doesn't mean that you're definitely 223 00:09:55,320 --> 00:09:58,040 Speaker 1: signing yourselves up to to be renters for the next 224 00:09:58,240 --> 00:10:01,040 Speaker 1: three years. But let's also how about the warning flags 225 00:10:01,080 --> 00:10:03,000 Speaker 1: On the other hand, that would make me very hesitant 226 00:10:03,040 --> 00:10:05,520 Speaker 1: to buy if I was in your situation. You just 227 00:10:05,600 --> 00:10:08,839 Speaker 1: don't currently have the income to support a mortgage on 228 00:10:08,880 --> 00:10:11,679 Speaker 1: an eight hundred thousand dollar home, especially with what you 229 00:10:11,760 --> 00:10:14,679 Speaker 1: currently have as a down payment. An average mortgage payment 230 00:10:14,720 --> 00:10:18,280 Speaker 1: with today's rates would be at least a month. And 231 00:10:18,360 --> 00:10:21,640 Speaker 1: that's assuming that you have enough for a down payment 232 00:10:21,840 --> 00:10:24,160 Speaker 1: of a hundred and sixty dollars, which it sounds like 233 00:10:24,320 --> 00:10:26,400 Speaker 1: you don't. You sound like you had forty dollars in 234 00:10:26,480 --> 00:10:29,720 Speaker 1: cash reserves, which doesn't get you to that point. Getting 235 00:10:29,800 --> 00:10:32,319 Speaker 1: all that lined up would be hard enough as it is. 236 00:10:32,440 --> 00:10:34,560 Speaker 1: But you're also self employed, which means you're gonna need 237 00:10:34,840 --> 00:10:37,120 Speaker 1: two years of solid tax history to be able to 238 00:10:37,280 --> 00:10:39,640 Speaker 1: prove your income to a mortgage lender. Yeah. And I 239 00:10:39,720 --> 00:10:41,440 Speaker 1: can personally speak to that when Kate and I when 240 00:10:41,480 --> 00:10:44,120 Speaker 1: we were buying our first home, we were self employed 241 00:10:44,160 --> 00:10:46,439 Speaker 1: and it had only been like barely two years, and 242 00:10:46,520 --> 00:10:49,000 Speaker 1: so it was really really difficult for us to secure 243 00:10:49,040 --> 00:10:51,600 Speaker 1: that mortgage. Uh. And so well, you know, even if 244 00:10:51,679 --> 00:10:54,200 Speaker 1: you wanted to move forward, uh. And you guys made 245 00:10:54,200 --> 00:10:56,199 Speaker 1: the decision to try to do this, you may not 246 00:10:56,240 --> 00:10:58,280 Speaker 1: be able to based on the restrictions that a lender 247 00:10:58,360 --> 00:11:00,280 Speaker 1: might put on you, guys. And so you know, what 248 00:11:00,400 --> 00:11:02,320 Speaker 1: Joel and I would say is that, ultimately, don't count 249 00:11:02,360 --> 00:11:04,720 Speaker 1: your chickens before they hatch, right. You know, it's great 250 00:11:04,800 --> 00:11:07,240 Speaker 1: that your prospects are solid here, and we hope that 251 00:11:07,320 --> 00:11:11,480 Speaker 1: your financial projections do come true and and even more so. Right, 252 00:11:12,080 --> 00:11:15,160 Speaker 1: but buying a home before you already can put just 253 00:11:15,520 --> 00:11:19,040 Speaker 1: undo strain on your finances, on your relationship as well. 254 00:11:19,400 --> 00:11:21,800 Speaker 1: So you know, keep on building up your savings and 255 00:11:21,880 --> 00:11:24,640 Speaker 1: in a few years time, you'll be mega ready to 256 00:11:24,720 --> 00:11:26,560 Speaker 1: purchase a home. I know that there. You know, there 257 00:11:26,600 --> 00:11:28,520 Speaker 1: can be a bit of fomo when it comes to 258 00:11:28,960 --> 00:11:31,680 Speaker 1: buying a home. Uh. And everyone in the real estate 259 00:11:31,720 --> 00:11:33,719 Speaker 1: business will tell you that you need to jump now. 260 00:11:34,200 --> 00:11:37,240 Speaker 1: They will, particularly with the rates where they are, Like, 261 00:11:37,679 --> 00:11:39,280 Speaker 1: I feel it a little bit right now myself. I'm 262 00:11:39,320 --> 00:11:42,040 Speaker 1: you know, I'm considering refinancing because rates are so low. 263 00:11:42,440 --> 00:11:45,000 Speaker 1: But that doesn't matter if you are not ready, if 264 00:11:45,040 --> 00:11:46,719 Speaker 1: your finances aren't where they need to be. And so 265 00:11:47,040 --> 00:11:49,160 Speaker 1: you know, we're we're actually gonna talk more about fomo 266 00:11:49,760 --> 00:11:51,640 Speaker 1: on Wednesday's episode. To keep an eye out for that. 267 00:11:51,720 --> 00:11:53,520 Speaker 1: Be sure to give that one a listen as well. Yeah, 268 00:11:53,559 --> 00:11:56,200 Speaker 1: And I think real estate right now, with how home 269 00:11:56,280 --> 00:11:59,720 Speaker 1: prices have appreciated and the combination of super low rates 270 00:12:00,000 --> 00:12:02,360 Speaker 1: has made it a topic of discussion and it's caused 271 00:12:02,360 --> 00:12:04,240 Speaker 1: a lot of people who aren't quite ready to really 272 00:12:04,280 --> 00:12:05,719 Speaker 1: really want to buy a home. But you have to 273 00:12:05,760 --> 00:12:08,680 Speaker 1: make sure that your finances are in a great spot 274 00:12:08,840 --> 00:12:12,160 Speaker 1: before you actually continued on that process and purchase a home, 275 00:12:12,520 --> 00:12:13,959 Speaker 1: or it could put you in your fiance in a 276 00:12:14,000 --> 00:12:16,160 Speaker 1: tough financial situation that you don't want to be in. 277 00:12:16,600 --> 00:12:18,280 Speaker 1: So best of luck to you will in saving up 278 00:12:18,320 --> 00:12:20,840 Speaker 1: for that house. Matt. Let's get to a couple more questions, 279 00:12:20,920 --> 00:12:24,240 Speaker 1: including that one about travel rewards or cash back rewards. 280 00:12:24,280 --> 00:12:26,600 Speaker 1: Which one is better? Which one should you prioritize. We'll 281 00:12:26,640 --> 00:12:37,840 Speaker 1: get to those and more right after this break. All right, 282 00:12:37,920 --> 00:12:40,080 Speaker 1: we are back in. Before we get to that question 283 00:12:40,280 --> 00:12:43,240 Speaker 1: about credit card rewards, let's get to a question from 284 00:12:43,320 --> 00:12:46,680 Speaker 1: that couple that's up there in Maine. Hi, Matt and Joel. 285 00:12:46,840 --> 00:12:49,599 Speaker 1: This is Maggie and Elliott from Portland's, Maine, and we 286 00:12:49,679 --> 00:12:52,160 Speaker 1: are huge fans of the show. We have a question 287 00:12:52,240 --> 00:12:55,360 Speaker 1: for you about joint brokerage accounts. We're both a few 288 00:12:55,400 --> 00:12:57,880 Speaker 1: years out of college and work in the environmental field. 289 00:12:58,240 --> 00:13:01,600 Speaker 1: We both fully fund and manage our roth iras each 290 00:13:01,679 --> 00:13:04,920 Speaker 1: year through Vanguard and have healthy emergency funds set aside. 291 00:13:05,440 --> 00:13:08,000 Speaker 1: We do each have a student debt to take advantage 292 00:13:08,040 --> 00:13:11,120 Speaker 1: of the main education tax credit, which refunds us our 293 00:13:11,200 --> 00:13:15,199 Speaker 1: student loan payments up to about a year each. We're 294 00:13:15,240 --> 00:13:17,600 Speaker 1: looking for a way to effectively invest more of our 295 00:13:17,640 --> 00:13:20,640 Speaker 1: money to use ten to punty years out. We're considering 296 00:13:20,679 --> 00:13:23,720 Speaker 1: opening a joint brokerage account together through Vanguard, and are 297 00:13:23,800 --> 00:13:27,400 Speaker 1: curious about tax implications for an unmarried couple. We would 298 00:13:27,440 --> 00:13:31,520 Speaker 1: also appreciate any insight on advantages or disadvantages to this strategy. 299 00:13:32,040 --> 00:13:33,600 Speaker 1: Do you think it would be better to have separate 300 00:13:33,600 --> 00:13:37,280 Speaker 1: accounts or combined forces to maximize the effects of compounding interest. 301 00:13:37,840 --> 00:13:41,080 Speaker 1: Portland has fantastic breweries and we'd recommend Rising Tide if 302 00:13:41,120 --> 00:13:43,720 Speaker 1: you're ever in town. Thanks so much for your answers. 303 00:13:44,440 --> 00:13:49,559 Speaker 1: All right, our first joint question, and she mentioned Rising Tide, 304 00:13:49,640 --> 00:13:51,160 Speaker 1: which is actually a brewery that Kate and I have 305 00:13:51,280 --> 00:13:52,760 Speaker 1: been too. When we went up to Portland for a 306 00:13:52,800 --> 00:13:56,559 Speaker 1: little little trip. Yeah, we rented bikes downtown and we 307 00:13:56,880 --> 00:13:58,920 Speaker 1: rode I think it was like the Promenade trail or 308 00:13:58,960 --> 00:14:00,640 Speaker 1: something like that. We rode all the around, like the 309 00:14:00,720 --> 00:14:03,559 Speaker 1: tip up, all the way around when we dropped back down. Uh, 310 00:14:03,640 --> 00:14:06,520 Speaker 1: And then I had coordinated our our bike ride to 311 00:14:06,600 --> 00:14:09,080 Speaker 1: go by this other brewery and it was Rising Tide, 312 00:14:09,160 --> 00:14:11,720 Speaker 1: so of course coordinated a bike ride to go by 313 00:14:11,720 --> 00:14:13,880 Speaker 1: a brewery bikes and beer. Baby can't beat that, Like, 314 00:14:14,000 --> 00:14:16,559 Speaker 1: that's my type of vacation. And Maine, man, it's just 315 00:14:16,600 --> 00:14:20,520 Speaker 1: such a beautiful and Bistle and Oxbow or two other 316 00:14:20,720 --> 00:14:23,000 Speaker 1: just awesome breweries up there by the way to that 317 00:14:23,120 --> 00:14:26,520 Speaker 1: main education tax credit that Maggie mentioned is awesome for 318 00:14:26,680 --> 00:14:29,040 Speaker 1: any young folks that that move to Maine. Um. I 319 00:14:29,160 --> 00:14:31,160 Speaker 1: love that they're taking advantage of that. When I think 320 00:14:31,160 --> 00:14:33,440 Speaker 1: when a state offers money to help draw young talent, 321 00:14:33,520 --> 00:14:36,240 Speaker 1: often it's a win win for the individuals who are 322 00:14:36,280 --> 00:14:39,120 Speaker 1: helping getting their students getting some student loan relief, and 323 00:14:39,200 --> 00:14:41,720 Speaker 1: then also to for the state because there are people 324 00:14:41,760 --> 00:14:45,040 Speaker 1: who get drawn there for the monetary incentive and then 325 00:14:45,120 --> 00:14:47,680 Speaker 1: oftentimes they end up sticking around and they make a 326 00:14:47,720 --> 00:14:49,320 Speaker 1: difference in the place where they live, and they pay 327 00:14:49,360 --> 00:14:51,280 Speaker 1: taxes in the place where they live, and so UM, 328 00:14:51,360 --> 00:14:53,160 Speaker 1: I think it's a good thing for the state and 329 00:14:53,240 --> 00:14:55,400 Speaker 1: the individual. It definitely doesn't hurt when it's a city 330 00:14:55,480 --> 00:14:58,080 Speaker 1: that's as beautiful as Portlands. Right, you're like, oh, this 331 00:14:58,120 --> 00:15:00,040 Speaker 1: place is actually great. You didn't enough to pay me 332 00:15:00,080 --> 00:15:04,760 Speaker 1: to come exactly, Maggie, Let's talk to you about just 333 00:15:04,840 --> 00:15:07,640 Speaker 1: some of the I guess particulars about a joint accounts. 334 00:15:07,720 --> 00:15:09,880 Speaker 1: You know, you both are already crushing it so hard 335 00:15:10,280 --> 00:15:12,280 Speaker 1: when it comes to your personal finances. So that's great. 336 00:15:12,480 --> 00:15:14,240 Speaker 1: I love that you wanna, you know, do even more, 337 00:15:14,600 --> 00:15:17,400 Speaker 1: and you know your personal finance situation and timeline. It 338 00:15:17,600 --> 00:15:19,680 Speaker 1: totally makes investing the right move. You're talking about some 339 00:15:19,800 --> 00:15:22,280 Speaker 1: longer term savings, and so you want to be investing 340 00:15:22,320 --> 00:15:25,200 Speaker 1: that money, not just saving it. And so let's specifically 341 00:15:25,240 --> 00:15:27,720 Speaker 1: talk about whether you should have a joint account though 342 00:15:28,120 --> 00:15:31,680 Speaker 1: or not. Um First off, having separate or joint accounts 343 00:15:31,840 --> 00:15:34,880 Speaker 1: that will not affect the ability of your money to 344 00:15:35,320 --> 00:15:38,400 Speaker 1: compound as it grows. Right, ten thousand dollars in one 345 00:15:38,440 --> 00:15:41,960 Speaker 1: account versus five thousand dollars in two separate accounts will 346 00:15:42,000 --> 00:15:45,280 Speaker 1: still see the same net return. Uh, if it's invested 347 00:15:45,360 --> 00:15:47,200 Speaker 1: in the same way. You know, there's no magic in 348 00:15:47,280 --> 00:15:50,280 Speaker 1: combining your money. There's no like with our Powers combined 349 00:15:50,960 --> 00:15:53,480 Speaker 1: or Captain Planet. Yeah exactly, which, by the way, she 350 00:15:53,560 --> 00:15:55,040 Speaker 1: did say that they both worked in I guess the 351 00:15:55,120 --> 00:15:59,640 Speaker 1: environmental sector. So maybe she's familiar with cartoon. Maybe Captain 352 00:15:59,680 --> 00:16:01,800 Speaker 1: Planet inspired her to do what she's doing today. That 353 00:16:01,880 --> 00:16:04,000 Speaker 1: could be true, all right, and Matt. Let's talk about 354 00:16:04,200 --> 00:16:07,800 Speaker 1: joint brokerage accounts. What should uh, should Maggie Elliott have 355 00:16:07,920 --> 00:16:10,320 Speaker 1: an account together? Should they do it separately? And we 356 00:16:10,360 --> 00:16:12,720 Speaker 1: would say separate is the best way to go for now, 357 00:16:12,880 --> 00:16:15,960 Speaker 1: especially since you're not actually married. And that is not 358 00:16:16,080 --> 00:16:18,120 Speaker 1: a slight against people who choose not to get married 359 00:16:18,120 --> 00:16:20,160 Speaker 1: who or who aren't married yet. It's just that there 360 00:16:20,200 --> 00:16:24,760 Speaker 1: are financial reasons that make it less advantageous for married folks. 361 00:16:24,920 --> 00:16:29,040 Speaker 1: A shared brokerage account offers some helpful benefits, but if 362 00:16:29,080 --> 00:16:31,480 Speaker 1: you haven't tied the not yet though, keeping your accounts 363 00:16:31,800 --> 00:16:34,960 Speaker 1: separate offers the most protection for each of you as individuals. 364 00:16:35,160 --> 00:16:38,440 Speaker 1: And let' let's touch on the legal nitty gritty as well. Maggie, um, 365 00:16:38,920 --> 00:16:40,440 Speaker 1: you know, one of the benefits that comes with a 366 00:16:40,480 --> 00:16:43,320 Speaker 1: joint account is that you automatically know I guess where 367 00:16:43,400 --> 00:16:45,160 Speaker 1: that money would go in case one of you, you know, 368 00:16:45,280 --> 00:16:47,840 Speaker 1: if one of you were to die. But a simple 369 00:16:47,920 --> 00:16:50,440 Speaker 1: solution to that when it comes to beneficiaries is just 370 00:16:50,640 --> 00:16:53,120 Speaker 1: make sure that you name Elliott as your beneficiary on 371 00:16:53,280 --> 00:16:55,640 Speaker 1: your own account, and then Elliott you do the same 372 00:16:55,680 --> 00:16:57,400 Speaker 1: thing for Maggie. That's right, Elliot. If Maggie does it 373 00:16:57,480 --> 00:16:59,120 Speaker 1: for you, you do it for her too, Okay, not 374 00:16:59,200 --> 00:17:01,120 Speaker 1: cool if you don't um, And of course that I'll 375 00:17:01,200 --> 00:17:03,360 Speaker 1: ensure that if anything happens to either of you, that 376 00:17:03,480 --> 00:17:06,879 Speaker 1: the money you've invested would go to your partner. You know. 377 00:17:06,960 --> 00:17:09,399 Speaker 1: And there could also be some you know, gift tax 378 00:17:09,520 --> 00:17:12,639 Speaker 1: issues associated with a joint brokerage account. My guess is 379 00:17:12,720 --> 00:17:15,680 Speaker 1: that is unlikely, but avoiding those altogether is another reason 380 00:17:16,000 --> 00:17:18,159 Speaker 1: for you to each have your own account uh and 381 00:17:18,280 --> 00:17:20,480 Speaker 1: not to mention to it's having your own accounts is 382 00:17:20,480 --> 00:17:23,720 Speaker 1: the easiest way to keep your money separate of each 383 00:17:23,720 --> 00:17:26,159 Speaker 1: other in case things were to not work out. Obviously 384 00:17:26,200 --> 00:17:27,800 Speaker 1: you're gonna hope that things do work out for the 385 00:17:27,800 --> 00:17:29,919 Speaker 1: two of you. But one of the biggest legal knots 386 00:17:29,960 --> 00:17:32,920 Speaker 1: to Untie is when you've combined your finances like that, 387 00:17:33,080 --> 00:17:35,359 Speaker 1: you know, before you've gotten married, and so keeping that 388 00:17:35,400 --> 00:17:37,560 Speaker 1: separate until you do actually get married is what we 389 00:17:37,600 --> 00:17:40,160 Speaker 1: would recommend. Yeah, there's so many other ways before you're 390 00:17:40,160 --> 00:17:42,680 Speaker 1: married that you can combine your life, but tying the 391 00:17:42,960 --> 00:17:45,639 Speaker 1: joint brokerage account not Maybe that should wait until you 392 00:17:45,720 --> 00:17:47,879 Speaker 1: tie the actual not too so. Best of luck to 393 00:17:47,920 --> 00:17:50,440 Speaker 1: you guys moving forward. Matt let's you to our next question. 394 00:17:50,520 --> 00:17:53,240 Speaker 1: This one's about credit cards. I'm Matt and Joel. My 395 00:17:53,400 --> 00:17:56,560 Speaker 1: name's Mary. I am out of Louisville, Kentucky. I have 396 00:17:56,720 --> 00:17:58,720 Speaker 1: to say I love your podcast. I've been listening for 397 00:17:58,760 --> 00:18:01,199 Speaker 1: about a year now and it's really changed the direction 398 00:18:01,280 --> 00:18:03,720 Speaker 1: of my savings. I do have a question for you 399 00:18:03,800 --> 00:18:06,720 Speaker 1: about credit cards, and I do have a Discover card 400 00:18:06,800 --> 00:18:09,760 Speaker 1: right now where I'm earning five cash back on certain 401 00:18:10,000 --> 00:18:13,879 Speaker 1: categories each quarter. I am curious whether having a credit 402 00:18:13,920 --> 00:18:17,600 Speaker 1: card with high cash back percentages versus having a credit 403 00:18:17,640 --> 00:18:20,480 Speaker 1: card with travel rewards points would be better. I'm not 404 00:18:20,600 --> 00:18:24,400 Speaker 1: really sure how to compute the travel rewards points into 405 00:18:24,480 --> 00:18:27,520 Speaker 1: cash back and how that compares dollar for dollar. I 406 00:18:27,640 --> 00:18:30,280 Speaker 1: do love to travel, but if the cash back versus 407 00:18:30,400 --> 00:18:34,080 Speaker 1: the travel rewards points financially quite out to about the 408 00:18:34,160 --> 00:18:36,600 Speaker 1: same amount, it seems like it would make more sense 409 00:18:36,680 --> 00:18:39,040 Speaker 1: to get cash back so you can use that for anything. 410 00:18:39,600 --> 00:18:42,600 Speaker 1: Any advice you have would be great. Thank you, Mary. 411 00:18:42,640 --> 00:18:44,879 Speaker 1: We appreciate you listening to the show for for so 412 00:18:45,000 --> 00:18:47,520 Speaker 1: long and we're glad that this has made a positive 413 00:18:47,520 --> 00:18:49,920 Speaker 1: impact in your life. And great question as well. Let's 414 00:18:49,960 --> 00:18:51,320 Speaker 1: get into it. And you said that you like to 415 00:18:51,359 --> 00:18:54,040 Speaker 1: travel quite a bit, so you know, it probably makes 416 00:18:54,080 --> 00:18:56,640 Speaker 1: sense to do both, right, do both? Yeah, I forgot 417 00:18:56,680 --> 00:18:58,840 Speaker 1: That's my favorite answer to any question. Do it all. 418 00:18:59,720 --> 00:19:01,720 Speaker 1: It some balance, And a lot of times folks don't 419 00:19:01,720 --> 00:19:02,800 Speaker 1: want to hear that they want us to hear, like 420 00:19:02,840 --> 00:19:04,639 Speaker 1: a slam dunkings or one way or the other. But 421 00:19:04,760 --> 00:19:06,600 Speaker 1: in this case, this is one of those answers where 422 00:19:06,600 --> 00:19:08,800 Speaker 1: I think we're gonna recommend both. Man. I've I've got 423 00:19:08,960 --> 00:19:12,040 Speaker 1: three credit cards that I use regularly, depending on you know, 424 00:19:12,080 --> 00:19:14,240 Speaker 1: where I'm spending, whether I'm you know, buying in person 425 00:19:14,400 --> 00:19:16,480 Speaker 1: or online. And so Mary, I like the idea of 426 00:19:16,520 --> 00:19:19,080 Speaker 1: you having a diverse mix of cards too, for a 427 00:19:19,160 --> 00:19:21,480 Speaker 1: few reasons. One of those reasons is that some of 428 00:19:21,520 --> 00:19:23,560 Speaker 1: the different credit card companies out there, they took a 429 00:19:23,640 --> 00:19:26,520 Speaker 1: hard line during the pandemic and started to really cut 430 00:19:26,600 --> 00:19:29,119 Speaker 1: back on the limits, really affecting people who were in 431 00:19:29,160 --> 00:19:31,600 Speaker 1: a tough situation, Folks who are using their cards as 432 00:19:31,640 --> 00:19:33,760 Speaker 1: sort of a lifeline. Yeah, I mean cutting their spending 433 00:19:33,800 --> 00:19:35,840 Speaker 1: limits essentially. Like so, let's say it was it used 434 00:19:35,840 --> 00:19:38,360 Speaker 1: to have a credit limit of then it was slashed 435 00:19:38,400 --> 00:19:41,119 Speaker 1: to six thousand, and and that had a really rough 436 00:19:41,160 --> 00:19:43,040 Speaker 1: impact on a lot of people's credit scores. Yeah, especially 437 00:19:43,040 --> 00:19:44,639 Speaker 1: if you already had five thousand on that card and 438 00:19:44,760 --> 00:19:47,760 Speaker 1: all of a sudden your utilization ratio just shot up exactly. 439 00:19:47,920 --> 00:19:50,280 Speaker 1: And so having a few different cards and not only 440 00:19:50,359 --> 00:19:53,040 Speaker 1: opens you up to a maximum reward potential, but it 441 00:19:53,119 --> 00:19:55,360 Speaker 1: also ensures that you won't end up in a situation 442 00:19:55,640 --> 00:19:57,159 Speaker 1: I think like a lot of folks fum themselves in 443 00:19:57,240 --> 00:19:59,160 Speaker 1: during the pandemic. Ye. Good point, Matt. And then also 444 00:19:59,240 --> 00:20:02,879 Speaker 1: let's speak specifically the cash back versus travel rewards, and 445 00:20:02,960 --> 00:20:04,920 Speaker 1: like you said, I think both is the best answer. 446 00:20:05,280 --> 00:20:07,000 Speaker 1: Finding the credit cards that are going to offer you 447 00:20:07,080 --> 00:20:09,840 Speaker 1: the best rewards in certain categories is is often the 448 00:20:09,920 --> 00:20:12,880 Speaker 1: best way to go. And having a mix of maybe 449 00:20:12,960 --> 00:20:16,280 Speaker 1: three or four credit cards that have different perks can 450 00:20:16,359 --> 00:20:18,920 Speaker 1: be the best for you. So using something like the 451 00:20:19,040 --> 00:20:22,600 Speaker 1: am X Blue Cash preferred for your streaming and grocery 452 00:20:22,600 --> 00:20:25,240 Speaker 1: store purchases is a good way to go. And then 453 00:20:25,560 --> 00:20:27,879 Speaker 1: and then having a travel credit card for all your 454 00:20:27,920 --> 00:20:30,200 Speaker 1: travel expenses is smart. And then on top of that, 455 00:20:30,440 --> 00:20:33,880 Speaker 1: having something like the City Double Cash card that would 456 00:20:33,880 --> 00:20:36,399 Speaker 1: be specifically for all the other things you spend money on. 457 00:20:36,640 --> 00:20:39,440 Speaker 1: Because you're getting a consistent two percent cash back on 458 00:20:39,560 --> 00:20:42,040 Speaker 1: all those purchases. That just insures that you're getting the 459 00:20:42,119 --> 00:20:45,120 Speaker 1: best bang for your buck on on everything whenever you're 460 00:20:45,160 --> 00:20:47,680 Speaker 1: spending money. And Matt just like, I think one trick 461 00:20:47,760 --> 00:20:50,120 Speaker 1: for people who have maybe a few too many credit 462 00:20:50,160 --> 00:20:53,119 Speaker 1: cards and they forget which one is for what purpose? Um, 463 00:20:53,200 --> 00:20:56,880 Speaker 1: I would say that you can label them in your wallet, uh, 464 00:20:57,200 --> 00:20:59,320 Speaker 1: whether it's just like with a sharpie or some sort 465 00:20:59,320 --> 00:21:01,159 Speaker 1: of a label print turn and that can kind of 466 00:21:01,240 --> 00:21:03,560 Speaker 1: help you remember, all right, this card is for eating out, 467 00:21:03,720 --> 00:21:06,359 Speaker 1: this card is for groceries, and this card is for 468 00:21:06,800 --> 00:21:09,600 Speaker 1: everything else, um or gas, whatever it is. You know, 469 00:21:09,800 --> 00:21:11,680 Speaker 1: it can be a helpful reminder because I know some 470 00:21:11,800 --> 00:21:13,800 Speaker 1: people can be like, that's too much, it's overloads, So 471 00:21:13,800 --> 00:21:16,240 Speaker 1: I'm gonna stick with one card. But really, yeah, it's 472 00:21:16,320 --> 00:21:18,680 Speaker 1: in your financial best interest to have a few different 473 00:21:18,720 --> 00:21:20,720 Speaker 1: ones to choose from. And according to Joela, it also 474 00:21:20,760 --> 00:21:23,760 Speaker 1: makes sense for you to have a label printer. I mean, 475 00:21:23,800 --> 00:21:25,119 Speaker 1: if you got when you go sharpie, you can go 476 00:21:25,200 --> 00:21:28,440 Speaker 1: basic with a sharpie, all right, Boomer, that's just such 477 00:21:28,440 --> 00:21:30,359 Speaker 1: an old school thing to do, is have a label 478 00:21:30,400 --> 00:21:32,159 Speaker 1: maker and you're sticking it. You're not talking about a 479 00:21:32,200 --> 00:21:34,680 Speaker 1: label maker. I don't have a label maker, but no, 480 00:21:34,880 --> 00:21:37,320 Speaker 1: I just write something like, you know, maybe even just 481 00:21:37,720 --> 00:21:41,280 Speaker 1: like two initials like travel. Yeah, I don't know having 482 00:21:41,359 --> 00:21:43,840 Speaker 1: having a sharpie I love dude, I love Sharpie's. That's 483 00:21:43,880 --> 00:21:46,639 Speaker 1: like my favorite thing to do is just mark stuff up. Uh. 484 00:21:46,960 --> 00:21:50,160 Speaker 1: Also Mary was asking about how to quantify the benefits 485 00:21:50,400 --> 00:21:52,920 Speaker 1: of a travel card, you know, travel rewards versus cash 486 00:21:53,000 --> 00:21:55,520 Speaker 1: back and generally speaking, the reards that you're gonna get 487 00:21:55,560 --> 00:21:57,960 Speaker 1: on a travel card, right, whether it be uh just 488 00:21:58,080 --> 00:22:00,720 Speaker 1: points or airline miles, you're going to get more bang 489 00:22:00,760 --> 00:22:03,680 Speaker 1: for your buck when it comes to those benefits. But 490 00:22:03,760 --> 00:22:07,760 Speaker 1: the thing is that's great if you're using those benefits, right. 491 00:22:08,000 --> 00:22:09,920 Speaker 1: And so this is a part of the reason why 492 00:22:10,000 --> 00:22:12,560 Speaker 1: we like saying both because if you have a ton 493 00:22:12,640 --> 00:22:15,879 Speaker 1: of airline points or miles kind of socked away and 494 00:22:15,960 --> 00:22:18,080 Speaker 1: you're not using them, well, there's no sense in continuing 495 00:22:18,160 --> 00:22:20,680 Speaker 1: to rack up those points where those miles uh switch 496 00:22:20,760 --> 00:22:23,280 Speaker 1: over to a cash back card. But if travel really 497 00:22:23,400 --> 00:22:24,920 Speaker 1: is a priority for you and it's something that you're 498 00:22:24,920 --> 00:22:28,560 Speaker 1: doing often, then definitely go with the travel awards. Uh. 499 00:22:28,680 --> 00:22:31,200 Speaker 1: It's it is difficult to beat the return that you're 500 00:22:31,200 --> 00:22:33,159 Speaker 1: going to get on those it's a great deal if 501 00:22:33,200 --> 00:22:35,760 Speaker 1: you're using it. Yeah, yeah, But the interesting thing that 502 00:22:35,920 --> 00:22:38,359 Speaker 1: with travel cards is that a lot of people haven't 503 00:22:38,400 --> 00:22:41,000 Speaker 1: been using them lately. Of course because of COVID. Lots 504 00:22:41,000 --> 00:22:43,800 Speaker 1: of folks have been canceling their travel awards cards because 505 00:22:43,840 --> 00:22:45,760 Speaker 1: they haven't been able to go anywhere and they want 506 00:22:45,800 --> 00:22:48,080 Speaker 1: to avoid an all likelihood a super high annual fee 507 00:22:48,359 --> 00:22:51,280 Speaker 1: that they're paying without really much benefit. But Mary, if 508 00:22:51,320 --> 00:22:53,520 Speaker 1: you're still traveling and you want to keep doing so, 509 00:22:53,960 --> 00:22:56,600 Speaker 1: then jumping on a travel specific credit card is in 510 00:22:56,680 --> 00:22:58,560 Speaker 1: not likelihood a great move for you. You might want 511 00:22:58,560 --> 00:23:00,760 Speaker 1: to go with an airline specific car, depending on which 512 00:23:00,760 --> 00:23:02,560 Speaker 1: airlines do the most service out of where you live. 513 00:23:02,800 --> 00:23:05,160 Speaker 1: I've had the Southwest card for a number of years. 514 00:23:05,400 --> 00:23:07,639 Speaker 1: The sign of bonus was great, um and like it 515 00:23:07,760 --> 00:23:09,440 Speaker 1: was basically like a ton of free flights on Southwest 516 00:23:09,440 --> 00:23:11,320 Speaker 1: when I signed it for the card. And Southwest also 517 00:23:11,480 --> 00:23:14,439 Speaker 1: is just hyper competitive with their fair Southwest the costco 518 00:23:14,520 --> 00:23:18,560 Speaker 1: of airlines pretty much. Yeah, I'd say so. But yeah, 519 00:23:18,560 --> 00:23:21,359 Speaker 1: if you don't have an airline that consistently charges low 520 00:23:21,440 --> 00:23:23,520 Speaker 1: fares that flies out of the airport where you live, 521 00:23:23,760 --> 00:23:26,040 Speaker 1: maybe a more general travel card is better for you. 522 00:23:26,440 --> 00:23:29,160 Speaker 1: We love the Chase Sapphire Preferred card and it comes 523 00:23:29,200 --> 00:23:32,400 Speaker 1: with a Swite seven fifty sign up bonus, which can 524 00:23:32,520 --> 00:23:35,720 Speaker 1: translate into even more money towards travel spending if you 525 00:23:35,840 --> 00:23:38,359 Speaker 1: hit the initial spending limit. So if you travel a 526 00:23:38,440 --> 00:23:42,520 Speaker 1: good bit, it's definitely worth that annual fee because of 527 00:23:42,760 --> 00:23:44,600 Speaker 1: all the additional parks that come with it for people 528 00:23:44,640 --> 00:23:46,879 Speaker 1: who do love to travel. Will post a link to 529 00:23:46,960 --> 00:23:48,520 Speaker 1: that card in our show notes so you can check 530 00:23:48,560 --> 00:23:50,320 Speaker 1: it out. Yeah, and it's worth missioning too. If you're 531 00:23:50,320 --> 00:23:52,520 Speaker 1: looking at specific airline cards, make sure that you're aware 532 00:23:52,600 --> 00:23:56,520 Speaker 1: of the specific expiration policies you know with those points, 533 00:23:56,560 --> 00:23:59,520 Speaker 1: because all the different companies out there have different policies, 534 00:23:59,560 --> 00:24:01,959 Speaker 1: and you don't want to have those expire where you're 535 00:24:01,960 --> 00:24:03,920 Speaker 1: missing out on all of those benefits, because that would 536 00:24:03,920 --> 00:24:05,960 Speaker 1: be the worst way to go, is losing out on 537 00:24:06,040 --> 00:24:08,440 Speaker 1: those benefits altogether, or if you close a card and 538 00:24:08,480 --> 00:24:12,240 Speaker 1: then all the points at yeah, exactly. So, Yeah, you 539 00:24:12,280 --> 00:24:14,119 Speaker 1: gotta make sure that you either transfer them to the 540 00:24:14,240 --> 00:24:18,280 Speaker 1: right place or spend all your points before canceling a card. Typically. Yeah, 541 00:24:18,359 --> 00:24:20,600 Speaker 1: and so we've got a couple more questions, including one 542 00:24:20,640 --> 00:24:24,280 Speaker 1: about a mortgage getting sold to another bank. But that's 543 00:24:24,280 --> 00:24:25,920 Speaker 1: all about we'll get to that one plus one other 544 00:24:26,160 --> 00:24:37,040 Speaker 1: right after this break. All right, we'll back from the break, 545 00:24:37,200 --> 00:24:39,720 Speaker 1: And this question is about a financial pain point that 546 00:24:39,800 --> 00:24:42,000 Speaker 1: many people who have bought a home have found themselves 547 00:24:42,040 --> 00:24:45,280 Speaker 1: in having their mortgage sold to another bank, sometimes a 548 00:24:45,359 --> 00:24:48,480 Speaker 1: bank you don't really like. Hi, guys, this is Mackenzie 549 00:24:48,520 --> 00:24:50,920 Speaker 1: from the Rhine, Ohio. I have a question for you 550 00:24:51,080 --> 00:24:54,399 Speaker 1: about mortgage companies. When we bought our first home, we 551 00:24:54,480 --> 00:24:57,920 Speaker 1: got a mortgage through a traditional, smaller company. Within three 552 00:24:57,960 --> 00:25:00,320 Speaker 1: months of closing, our mortgage was sold one of the 553 00:25:00,359 --> 00:25:04,680 Speaker 1: giant services. The process was incredibly stressful because they messed 554 00:25:04,760 --> 00:25:06,920 Speaker 1: up the transfer of the balances and it took over 555 00:25:07,040 --> 00:25:09,920 Speaker 1: a year and reporting the new servicer to the Consumer 556 00:25:10,000 --> 00:25:13,560 Speaker 1: Financial Protection Bureau to get it resolved. As we think 557 00:25:13,560 --> 00:25:16,200 Speaker 1: about what our next mortgage might look like, or possibly 558 00:25:16,280 --> 00:25:19,480 Speaker 1: refinancing this one, we wondered if there are any mortgage 559 00:25:19,480 --> 00:25:22,800 Speaker 1: companies out there that don't sell your mortgage, or if 560 00:25:22,840 --> 00:25:25,240 Speaker 1: there's a way to decrease the probability of your mortgage 561 00:25:25,280 --> 00:25:28,320 Speaker 1: being sold. We would like to never experience this again. 562 00:25:29,080 --> 00:25:33,399 Speaker 1: We look forward to hearing what you guys have to say. Thanks. Hey, McKenzie. 563 00:25:33,480 --> 00:25:35,800 Speaker 1: Great to hear from you and WHOA, I'm so sorry 564 00:25:35,840 --> 00:25:39,040 Speaker 1: that you went through that with your mortgage servicer, but 565 00:25:39,119 --> 00:25:41,320 Speaker 1: I am so very glad that you were able to 566 00:25:41,359 --> 00:25:46,000 Speaker 1: get that resolved. The CFPB is clutch in cases like 567 00:25:46,080 --> 00:25:49,560 Speaker 1: this when financial service companies turn you know, just a 568 00:25:49,680 --> 00:25:52,480 Speaker 1: deaf ear, you know, to the problems that they have 569 00:25:52,600 --> 00:25:55,399 Speaker 1: caused you. I understand how it would make you want 570 00:25:55,440 --> 00:25:58,000 Speaker 1: to do business directly with a loan provider who keeps 571 00:25:58,040 --> 00:26:00,240 Speaker 1: your loan in house instead of selling it. You know, 572 00:26:00,280 --> 00:26:03,639 Speaker 1: it's one of the majors who have mostly bad customer service. 573 00:26:03,920 --> 00:26:06,920 Speaker 1: I totally get that. Yeah, I understand that too. Wanting 574 00:26:06,960 --> 00:26:10,040 Speaker 1: to avoid doing business with banks they don't care about 575 00:26:10,080 --> 00:26:12,240 Speaker 1: you makes a whole lot of sense. And in your 576 00:26:12,280 --> 00:26:14,359 Speaker 1: case there there wasn't much you can do about it. 577 00:26:14,640 --> 00:26:16,800 Speaker 1: But from here on out, there is something you can 578 00:26:16,840 --> 00:26:20,760 Speaker 1: do in order to hopefully prevent your your new mortgage 579 00:26:20,920 --> 00:26:22,359 Speaker 1: on the next house you take out or if you 580 00:26:22,400 --> 00:26:25,200 Speaker 1: do a refi somewhere else, to prevent that being sold 581 00:26:25,280 --> 00:26:27,560 Speaker 1: to one of the big banks. And the best way 582 00:26:27,680 --> 00:26:29,879 Speaker 1: to do this is to avoid using a bank to 583 00:26:29,960 --> 00:26:32,520 Speaker 1: get your mortgage and instead go with a credit union. 584 00:26:33,280 --> 00:26:36,280 Speaker 1: I have to home loans through my local credit union, Matt, 585 00:26:36,520 --> 00:26:38,800 Speaker 1: and they've never been sold anywhere else. I've also used 586 00:26:38,840 --> 00:26:41,600 Speaker 1: a local bank a few different times to to purchase homes, 587 00:26:41,960 --> 00:26:44,639 Speaker 1: and those mortgages have been sold what percent of the 588 00:26:44,680 --> 00:26:49,320 Speaker 1: time are you asking me? Yes? Really, you're right? So 589 00:26:49,840 --> 00:26:51,880 Speaker 1: very similar here I got. Yeah. I've gone with local 590 00:26:51,920 --> 00:26:54,680 Speaker 1: credit unions before, and guess what my mortgages are still 591 00:26:54,800 --> 00:26:57,920 Speaker 1: being serviced by them. Uh. And I have two mortgages 592 00:26:58,040 --> 00:27:00,200 Speaker 1: with one of the bigs that I will not say 593 00:27:00,240 --> 00:27:03,159 Speaker 1: on this podcast, and guess what they were sold to 594 00:27:03,600 --> 00:27:07,040 Speaker 1: that big bank. Unfortunately, there's nothing I can do about 595 00:27:07,040 --> 00:27:09,480 Speaker 1: it at this point. I guess I could refin and 596 00:27:09,520 --> 00:27:11,440 Speaker 1: actually might be doing that soon, but we'll see. You know, 597 00:27:11,560 --> 00:27:13,280 Speaker 1: the only reason to do that is if you're actually 598 00:27:13,320 --> 00:27:15,560 Speaker 1: gonna save money, because closing cost is so prohibitive. But 599 00:27:15,640 --> 00:27:17,800 Speaker 1: the best thing to do is UH to to go 600 00:27:17,920 --> 00:27:20,280 Speaker 1: with the credit union, like we said, and they typically 601 00:27:20,480 --> 00:27:23,440 Speaker 1: keep loans in house instead of selling them as a 602 00:27:23,560 --> 00:27:26,200 Speaker 1: one time profit maker. That's the model that credit unions 603 00:27:26,280 --> 00:27:29,000 Speaker 1: roll with. And so what you should do is one 604 00:27:29,119 --> 00:27:31,400 Speaker 1: become a member of a local credit union or two, 605 00:27:31,760 --> 00:27:34,280 Speaker 1: and then ask that credit union if that's how they roll. 606 00:27:34,359 --> 00:27:36,600 Speaker 1: Before you take out a loan with them, say do 607 00:27:36,720 --> 00:27:39,720 Speaker 1: you keep your mortgage loans in house? And if they do, 608 00:27:39,840 --> 00:27:41,480 Speaker 1: then that's a great way to go and gives you 609 00:27:41,560 --> 00:27:43,920 Speaker 1: the peace of mind knowing that you'll never have to 610 00:27:44,000 --> 00:27:45,680 Speaker 1: go through that again where your loan is sold and 611 00:27:45,800 --> 00:27:48,320 Speaker 1: something gets messed up. Credit unions rock for a whole 612 00:27:48,359 --> 00:27:50,479 Speaker 1: lot of reasons, but they're particularly excellent when it comes 613 00:27:50,520 --> 00:27:52,679 Speaker 1: to mortgage loans. Yeah, it's all the listeners out there 614 00:27:52,720 --> 00:27:55,600 Speaker 1: as well. It's worth mentioning that, you know what happened 615 00:27:55,640 --> 00:27:58,560 Speaker 1: to McKenzie, it's not the norm, right, And so I 616 00:27:58,720 --> 00:28:01,840 Speaker 1: guess I don't want to scare everybody out there from 617 00:28:02,000 --> 00:28:05,840 Speaker 1: doing business with, you know, anybody except for a credit union. 618 00:28:06,520 --> 00:28:09,840 Speaker 1: I've used a mortgage underwriter a couple of times where 619 00:28:09,960 --> 00:28:12,119 Speaker 1: I knew specifically that they were going to sell that 620 00:28:12,200 --> 00:28:15,000 Speaker 1: mortgage to a large bank. That's actually how I got 621 00:28:15,040 --> 00:28:18,040 Speaker 1: those two mortgages with a big bank that I shall 622 00:28:18,119 --> 00:28:20,800 Speaker 1: not name. Uh And in that specific case for us, 623 00:28:21,040 --> 00:28:23,000 Speaker 1: it worked out really well because I mean, this is 624 00:28:23,160 --> 00:28:25,479 Speaker 1: a company that all they do is underwrite mortgages, right, 625 00:28:25,800 --> 00:28:28,320 Speaker 1: They are not in the business of servicing loans. But 626 00:28:28,400 --> 00:28:30,320 Speaker 1: what that meant is that they had a really smooth system. 627 00:28:30,320 --> 00:28:32,480 Speaker 1: They're able to keep costs down pretty low, and that 628 00:28:32,560 --> 00:28:34,280 Speaker 1: also meant that we were able to get a really 629 00:28:34,400 --> 00:28:37,639 Speaker 1: competitive rate as well, one that was really comparable to 630 00:28:37,880 --> 00:28:39,959 Speaker 1: a local credit union. And in our case, those were 631 00:28:40,000 --> 00:28:41,680 Speaker 1: sold and transferred over to it to the big bank 632 00:28:41,760 --> 00:28:43,640 Speaker 1: and there was not any errors, you know, like we 633 00:28:43,680 --> 00:28:46,200 Speaker 1: didn't have any issues. And so it's I guess it's 634 00:28:46,200 --> 00:28:49,880 Speaker 1: a little annoying, but they're totally within their legal rights 635 00:28:50,000 --> 00:28:52,440 Speaker 1: to do that. But if that's something that you want 636 00:28:52,480 --> 00:28:55,200 Speaker 1: to completely avoid, like Joel said, looking towards our credit 637 00:28:55,280 --> 00:28:57,200 Speaker 1: union is totally the way to go. Yeah, just to 638 00:28:57,320 --> 00:28:59,680 Speaker 1: drive home that point, this is a very rare circumstance, 639 00:28:59,760 --> 00:29:01,640 Speaker 1: and it's a very awful circumstance when you're in the 640 00:29:01,680 --> 00:29:03,920 Speaker 1: middle of it and it's taking you months of phone 641 00:29:03,920 --> 00:29:06,720 Speaker 1: calls and emails and just the annoying hassle of trying 642 00:29:06,760 --> 00:29:09,400 Speaker 1: to get an issue resolved where your mortgage balance wasn't 643 00:29:09,440 --> 00:29:12,080 Speaker 1: properly transferred to the new mortgage holder. But it's just 644 00:29:12,200 --> 00:29:14,960 Speaker 1: important to state that that what Mackenzie experienced, it's awful, 645 00:29:15,000 --> 00:29:17,000 Speaker 1: but it's also nothing more. Yeah, and you know, there 646 00:29:17,040 --> 00:29:18,800 Speaker 1: are other perks to using a credit union for a 647 00:29:18,840 --> 00:29:22,040 Speaker 1: home purchase as well, like the ability to go and 648 00:29:22,120 --> 00:29:24,160 Speaker 1: talk with somebody in person if you have any questions. Uh. 649 00:29:24,280 --> 00:29:27,400 Speaker 1: And again, credit unions often offer the best rates because 650 00:29:27,520 --> 00:29:30,720 Speaker 1: credit union members are also part owners. They aren't trying 651 00:29:30,800 --> 00:29:34,680 Speaker 1: to increase fees in order to maximize profits. So there 652 00:29:34,720 --> 00:29:37,960 Speaker 1: are multiple reasons why credit unions are top noxiists. Something 653 00:29:38,000 --> 00:29:41,280 Speaker 1: we would definitely recommend for the next property. Mackenzie, that 654 00:29:41,360 --> 00:29:43,840 Speaker 1: y'all buy, no doubt. So McKenzie, thanks for that question, 655 00:29:43,960 --> 00:29:45,840 Speaker 1: and Matt, let's get to the next one. This one's 656 00:29:45,840 --> 00:29:49,480 Speaker 1: about investing in a tax efficient way. Hey guys, this 657 00:29:49,680 --> 00:29:52,440 Speaker 1: is Jack from Denver. I'm currently in the wealth building 658 00:29:52,520 --> 00:29:55,520 Speaker 1: phase maxim retirement accounts with an h s A four 659 00:29:55,640 --> 00:29:58,600 Speaker 1: one K and roth thire Ray. As well as contributing 660 00:29:58,600 --> 00:30:01,760 Speaker 1: any access to a personal Keorage account. My company also 661 00:30:01,800 --> 00:30:03,600 Speaker 1: allows a mega back to a WRATH into the four 662 00:30:03,600 --> 00:30:05,840 Speaker 1: O one K, which I am taking advantage of. I'm 663 00:30:05,880 --> 00:30:08,200 Speaker 1: twenty eight years old and I'm hoping to retire early. 664 00:30:08,600 --> 00:30:10,560 Speaker 1: I have a pretty high risk tolerance when it comes 665 00:30:10,600 --> 00:30:12,520 Speaker 1: to investments, and I wanted to know if it makes 666 00:30:12,600 --> 00:30:16,000 Speaker 1: more sense to place higher risk investments in a particular account. 667 00:30:16,240 --> 00:30:19,000 Speaker 1: I'm mostly invested in target date retirement funds as well 668 00:30:19,040 --> 00:30:22,040 Speaker 1: as broad stock market funds, but I'm looking to increase 669 00:30:22,080 --> 00:30:25,240 Speaker 1: my holdings in the technology sector. Is there any benefit 670 00:30:25,320 --> 00:30:27,680 Speaker 1: to purchasing these risk here funds in a roth first 671 00:30:27,720 --> 00:30:30,920 Speaker 1: pre tax first personal brokerage account. Does it makes sense 672 00:30:31,000 --> 00:30:33,760 Speaker 1: to be looking at different investments across different account types 673 00:30:33,920 --> 00:30:36,760 Speaker 1: or am I over complicating things? Appreciate your time, looking 674 00:30:36,800 --> 00:30:40,480 Speaker 1: forward to hearing from you. Dang, it sounds like Jack's 675 00:30:40,480 --> 00:30:43,000 Speaker 1: definitely gonna be able to retire early with how he 676 00:30:43,160 --> 00:30:45,800 Speaker 1: is mac completely maxing out all his retirement options and 677 00:30:45,880 --> 00:30:48,160 Speaker 1: then some And Jack, you know, because you're on top 678 00:30:48,200 --> 00:30:50,320 Speaker 1: of things and you've got your ducks all in a row, 679 00:30:50,760 --> 00:30:52,719 Speaker 1: this is a great question to consider, you know, as 680 00:30:52,760 --> 00:30:56,360 Speaker 1: you're looking to optimize and make things even more efficient. Uh, 681 00:30:56,440 --> 00:30:58,320 Speaker 1: this is less of a concern for someone who is 682 00:30:58,440 --> 00:31:01,080 Speaker 1: maybe just getting started by This is a great consideration 683 00:31:01,160 --> 00:31:04,040 Speaker 1: for someone wanting to invest in the most tax efficient manner, 684 00:31:04,200 --> 00:31:05,680 Speaker 1: all right, mass, So let's get into that. And a 685 00:31:05,760 --> 00:31:08,960 Speaker 1: good strategy in order to minimize taxes is to buy 686 00:31:09,040 --> 00:31:12,480 Speaker 1: and hold tax efficient investments in taxable accounts and to 687 00:31:12,600 --> 00:31:16,480 Speaker 1: hold less tax efficient investments in tax advantaged accounts. So 688 00:31:16,560 --> 00:31:19,360 Speaker 1: that means investments that have the potential to generate lots 689 00:31:19,520 --> 00:31:22,000 Speaker 1: of tax are sheltered in accounts like four O one 690 00:31:22,040 --> 00:31:24,440 Speaker 1: case in wrath I raise. And then if you're looking 691 00:31:24,480 --> 00:31:27,040 Speaker 1: to also invest in taxable accounts, which it sounds like 692 00:31:27,120 --> 00:31:29,800 Speaker 1: you are, Jack, you are investing in your own brokerage account, 693 00:31:30,000 --> 00:31:33,240 Speaker 1: you want to fill those with investments that will trigger 694 00:31:33,320 --> 00:31:36,080 Speaker 1: as few taxes as possible. Yeah, So that raises the question, 695 00:31:36,280 --> 00:31:39,040 Speaker 1: you know what type of investments won't trigger as me 696 00:31:39,240 --> 00:31:42,560 Speaker 1: taxes And an aspect of investments that will make them 697 00:31:42,600 --> 00:31:45,840 Speaker 1: more or less tax efficient are the dividends that they pay. 698 00:31:46,120 --> 00:31:48,000 Speaker 1: For example, if you own a sock that pays a 699 00:31:48,040 --> 00:31:50,120 Speaker 1: high dividend, you know that is an investment that is 700 00:31:50,320 --> 00:31:52,800 Speaker 1: less tax efficient. So you would want that invested in 701 00:31:52,920 --> 00:31:56,160 Speaker 1: an account like a roth ira. Uh. If it's sitting 702 00:31:56,200 --> 00:31:59,200 Speaker 1: there in your wrath, those dividends will never be taxed. Uh. 703 00:31:59,280 --> 00:32:01,760 Speaker 1: And you know that's not the case for a brokerage account. 704 00:32:02,080 --> 00:32:04,240 Speaker 1: And just to get a little more nitty gritty, matt, 705 00:32:04,280 --> 00:32:06,360 Speaker 1: get a little more down the weeds. It also just 706 00:32:06,440 --> 00:32:10,280 Speaker 1: depends on the specific investments you're considering. You specifically mentioned 707 00:32:10,440 --> 00:32:14,600 Speaker 1: technology sector investments, Jack, But they can pay different dividends too, Right. 708 00:32:14,680 --> 00:32:19,479 Speaker 1: For example, Voo, which is Vanguard's smp F speaking my language, Joe, 709 00:32:19,880 --> 00:32:21,920 Speaker 1: I know you love that one pays a one point 710 00:32:21,960 --> 00:32:25,600 Speaker 1: five percent dividend yield, whereas Vanguards Technology e t F 711 00:32:25,840 --> 00:32:28,680 Speaker 1: v g T pays half of that at point eight percent. 712 00:32:29,040 --> 00:32:31,560 Speaker 1: But then if you're looking at certain single stocks, some 713 00:32:31,680 --> 00:32:34,840 Speaker 1: of them pay just massive dividends, Like IBM, they're paying 714 00:32:34,880 --> 00:32:37,640 Speaker 1: a full five percent yield, and so each of those 715 00:32:37,680 --> 00:32:41,120 Speaker 1: would have differing amounts of tax consequences based on the 716 00:32:41,160 --> 00:32:43,360 Speaker 1: dividend payout. Yeah, I'm also a fan of v g 717 00:32:43,520 --> 00:32:46,600 Speaker 1: T as well. That's Vanguards, Uh, tech stock e t F. 718 00:32:48,440 --> 00:32:51,000 Speaker 1: I own that as well, Is that? Jack? Maybe another 719 00:32:51,040 --> 00:32:53,680 Speaker 1: way to think about approaching investing in a tax efficient 720 00:32:53,720 --> 00:32:57,600 Speaker 1: manner is by putting your highest performing investments in the 721 00:32:57,680 --> 00:33:01,400 Speaker 1: most favorable tax advantage account, which will likely be your 722 00:33:01,520 --> 00:33:04,800 Speaker 1: riskier investments, right, Uh, that's probably not going to be 723 00:33:05,000 --> 00:33:08,080 Speaker 1: your target date retirement fund, uh, and then place your 724 00:33:08,120 --> 00:33:12,120 Speaker 1: more conservative, lower risk and and also likely lower performing 725 00:33:12,160 --> 00:33:15,560 Speaker 1: investments in your tax will brokerage account. You're gonna want 726 00:33:15,600 --> 00:33:18,760 Speaker 1: to shelter from tax whichever investments are are likely to 727 00:33:18,800 --> 00:33:21,560 Speaker 1: see the biggest gains. I think that's probably why you're 728 00:33:21,760 --> 00:33:23,920 Speaker 1: looking at maybe some of those uh those tech et 729 00:33:24,160 --> 00:33:26,720 Speaker 1: s or funds or stocks. You're looking maybe for a 730 00:33:26,760 --> 00:33:29,560 Speaker 1: little bit more return. Target date funds do consist a 731 00:33:29,600 --> 00:33:31,960 Speaker 1: little bit more of bonds, and so with it being 732 00:33:32,400 --> 00:33:35,000 Speaker 1: a more conservative fund like that, that would be something 733 00:33:35,120 --> 00:33:37,280 Speaker 1: I would be looking to put in a outside of 734 00:33:37,280 --> 00:33:39,800 Speaker 1: my retirement accounts, within a brokerage account, and saving that 735 00:33:39,840 --> 00:33:43,320 Speaker 1: space within those tax sheltered accounts for some higher performing 736 00:33:43,520 --> 00:33:46,600 Speaker 1: investments and assets. Yeah, and also Jack, it makes sense 737 00:33:46,640 --> 00:33:48,960 Speaker 1: to take advantage of tax breaks and to invest in 738 00:33:49,000 --> 00:33:51,240 Speaker 1: a tax efficient manner, but the key is not to 739 00:33:51,320 --> 00:33:54,560 Speaker 1: let those intricacies overwhelm you. The fact that you're investing 740 00:33:54,640 --> 00:33:57,320 Speaker 1: so much of your overall income, mostly in tax deferred 741 00:33:57,360 --> 00:34:00,720 Speaker 1: retirement accounts, is the main wealth driver here, and taxes 742 00:34:00,800 --> 00:34:02,720 Speaker 1: on investments when you're putting aside as much as you 743 00:34:02,800 --> 00:34:06,000 Speaker 1: are can get a little complex, and so it might 744 00:34:06,040 --> 00:34:07,960 Speaker 1: actually make sense for you to talk to a tax 745 00:34:08,040 --> 00:34:11,320 Speaker 1: pro or a financial planner to discuss your specific situation. 746 00:34:11,760 --> 00:34:14,160 Speaker 1: This can get a little nuanced and opaque, and so 747 00:34:14,600 --> 00:34:18,319 Speaker 1: having someone to guide you through your specific situation when 748 00:34:18,360 --> 00:34:20,319 Speaker 1: you're at the level you are and you're putting away 749 00:34:20,360 --> 00:34:22,879 Speaker 1: as much money as as you are right now, Jack 750 00:34:23,160 --> 00:34:25,120 Speaker 1: Um is not a bad idea. It's not a waste 751 00:34:25,160 --> 00:34:27,760 Speaker 1: of money to pay somebody and to talk to somebody 752 00:34:28,080 --> 00:34:30,279 Speaker 1: and to get their advice based on the accounts that 753 00:34:30,320 --> 00:34:33,080 Speaker 1: you have and the assets that you're invested in inside 754 00:34:33,120 --> 00:34:35,320 Speaker 1: of those accounts. So I would prioritize that with some 755 00:34:35,480 --> 00:34:37,479 Speaker 1: of your money, since you do want to retire early. 756 00:34:37,760 --> 00:34:40,680 Speaker 1: Hire someone, get a helping hand, get that outside perspective 757 00:34:40,880 --> 00:34:43,400 Speaker 1: on something that can be really confusing, but they can 758 00:34:43,480 --> 00:34:46,960 Speaker 1: also have a really important impact on your returns over 759 00:34:47,000 --> 00:34:49,359 Speaker 1: the years. Yeah, so Jack thinks so much for that question, 760 00:34:49,440 --> 00:34:51,800 Speaker 1: and thank you for listening to the show. Joel. Just 761 00:34:51,920 --> 00:34:53,359 Speaker 1: take it back to the beer that we were drinking 762 00:34:53,400 --> 00:34:56,279 Speaker 1: this episode. You and I were enjoying another one from 763 00:34:56,400 --> 00:34:59,680 Speaker 1: Heist Brewery out of Charlotte, North Carolina, and this one 764 00:34:59,760 --> 00:35:02,759 Speaker 1: is called Ancient Feelings. What your thoughts on this one? 765 00:35:02,840 --> 00:35:05,040 Speaker 1: But all right, so I gotta say this one came 766 00:35:05,120 --> 00:35:07,680 Speaker 1: in a mixed four pack, which I love the mixed 767 00:35:07,719 --> 00:35:09,520 Speaker 1: four pack. I don't know why more brewers don't do it, 768 00:35:09,560 --> 00:35:12,759 Speaker 1: Probably because it's a packaging nightmare. But I love the 769 00:35:12,800 --> 00:35:15,200 Speaker 1: fact you have a sample four different beers with one 770 00:35:15,360 --> 00:35:18,040 Speaker 1: four pack purchase so um, and four really good beers 771 00:35:18,080 --> 00:35:20,759 Speaker 1: at that. This one was a West Coast i p A, 772 00:35:21,400 --> 00:35:23,280 Speaker 1: more of a modern take on the West Coast IPA, 773 00:35:23,440 --> 00:35:27,239 Speaker 1: was super bitter without the like abrasively bitter aspects that 774 00:35:27,360 --> 00:35:29,080 Speaker 1: like the old school West Coast i p s I 775 00:35:29,120 --> 00:35:31,520 Speaker 1: think typically had. So yeah, I don't know. I like 776 00:35:31,640 --> 00:35:34,040 Speaker 1: this one a lot, even though West Coast ips aren't 777 00:35:34,040 --> 00:35:36,160 Speaker 1: typically my jam. Yeah, I mean, honestly, I think I 778 00:35:36,200 --> 00:35:37,759 Speaker 1: feel like that's why I like this West Coast i 779 00:35:37,840 --> 00:35:39,640 Speaker 1: p A. Is I am not a fan of like 780 00:35:39,920 --> 00:35:44,200 Speaker 1: the super you know, grapefruit bitter like super pithy style 781 00:35:44,239 --> 00:35:45,480 Speaker 1: I p A and so like, in my mind, this 782 00:35:45,560 --> 00:35:47,600 Speaker 1: one didn't taste all that better to me. It's like 783 00:35:47,719 --> 00:35:50,560 Speaker 1: it was very dry, uh and like kind of really 784 00:35:50,600 --> 00:35:53,279 Speaker 1: clean and fresh uh for a West Coast i p A, 785 00:35:53,840 --> 00:35:58,160 Speaker 1: which maybe makes sense considering this is a Charlotte Bass 786 00:35:58,239 --> 00:36:00,320 Speaker 1: Brewery making a West Coast i p A. They're not 787 00:36:00,440 --> 00:36:02,640 Speaker 1: really making a West Coast ip A. They're making an 788 00:36:02,680 --> 00:36:05,520 Speaker 1: East Coast interpretation of a West Coast ip A. It's 789 00:36:05,520 --> 00:36:08,200 Speaker 1: like getting Shanghai dumplings in Atlanta versus Shanghai. You know, 790 00:36:08,760 --> 00:36:12,120 Speaker 1: it's it's a it's a really lovely, pretty good but 791 00:36:12,120 --> 00:36:15,120 Speaker 1: it's not quite the same, right. Yeah, But that being said, 792 00:36:15,160 --> 00:36:17,480 Speaker 1: I really I still really enjoyed this beer. Yet another 793 00:36:17,560 --> 00:36:20,759 Speaker 1: example of a fantastic brewery out of North Carolina. So 794 00:36:21,360 --> 00:36:22,640 Speaker 1: glad you and I got to share this one on 795 00:36:22,680 --> 00:36:24,320 Speaker 1: the show today, man, But that's gonna be it for 796 00:36:24,360 --> 00:36:26,000 Speaker 1: this episode. We will post our show notes up on 797 00:36:26,040 --> 00:36:28,080 Speaker 1: our website at how to money dot com. We'll make 798 00:36:28,120 --> 00:36:29,520 Speaker 1: sure to link to any of the resources that we 799 00:36:29,560 --> 00:36:32,560 Speaker 1: mentioned during this episode, including a link to an articultural 800 00:36:32,640 --> 00:36:34,480 Speaker 1: that you wrote about some of our favorite credit cards. 801 00:36:34,560 --> 00:36:36,520 Speaker 1: Based on how it is that you spend your money 802 00:36:37,120 --> 00:36:39,360 Speaker 1: while you know, taking some of those airline or some 803 00:36:39,440 --> 00:36:41,480 Speaker 1: of those cash back points, while keeping all of that 804 00:36:41,560 --> 00:36:43,680 Speaker 1: in mind, that's that's really important to consider. Yeah, And 805 00:36:43,719 --> 00:36:46,680 Speaker 1: if you set up some extreme financial goals for yourself 806 00:36:46,719 --> 00:36:48,759 Speaker 1: at the beginning of this year and you're kind of 807 00:36:48,840 --> 00:36:50,680 Speaker 1: trying to figure out what it's actually gonna take to 808 00:36:50,680 --> 00:36:52,400 Speaker 1: accomplish those, do you have a question for Matt and I. 809 00:36:52,760 --> 00:36:55,919 Speaker 1: We'd love to offer our input on an upcoming ask 810 00:36:56,040 --> 00:36:58,360 Speaker 1: htm episode. If you want to submit a question for 811 00:36:58,480 --> 00:37:00,359 Speaker 1: a future episode, just gotta How the Money dot com 812 00:37:00,440 --> 00:37:02,880 Speaker 1: slash ask and it's super simple for you to submit 813 00:37:02,960 --> 00:37:05,480 Speaker 1: a voice recorded question for us to take on an 814 00:37:05,560 --> 00:37:07,600 Speaker 1: upcoming episode. But all right, Matt, that's gonna do it 815 00:37:07,680 --> 00:37:10,759 Speaker 1: for this one. Until next time. Best Friends Out, Best 816 00:37:10,880 --> 00:37:11,640 Speaker 1: Friends Out,