WEBVTT - Ask HTM - Consolidating Multiple Retirement Accounts, Rolling Equity into a New Home, & Keeping Up with an Allowance #832 0:00:00.080 --> 0:00:03.040 Welcome to had to Money. I'm Joel and I am Matt, 0:00:03.160 --> 0:00:05.800 and today we're going to answer some of your listener questions. 0:00:24.760 --> 0:00:27.040 We hope that you are having a great start to 0:00:27.080 --> 0:00:29.200 your week, and even better to start to your week 0:00:29.240 --> 0:00:32.560 now that you're listening to the wonderful tones of Joel's 0:00:32.600 --> 0:00:33.880 voice sitting across from me. 0:00:34.120 --> 0:00:36.639 We answered something. We released one episode a little late 0:00:36.720 --> 0:00:38.519 last week, Matt, just like a couple hours later a 0:00:38.560 --> 0:00:41.559 few weeks ago, and somebody in the Facebook group was like, no, man, 0:00:41.640 --> 0:00:44.840 Joel on my morning walk, and we're sorry. We'll try 0:00:44.880 --> 0:00:46.440 to do better. I try to do better. We like 0:00:46.520 --> 0:00:47.800 to accompany you on your marble. 0:00:47.840 --> 0:00:49.839 Well, and I don't know if anyone knows this, but 0:00:50.040 --> 0:00:53.920 the actual time that we set the episodes to publish, man, 0:00:54.200 --> 0:00:56.280 I feel like there is a high degree of accountability 0:00:56.320 --> 0:00:57.800 now that I'm actually saying all this out loud. I 0:00:57.840 --> 0:01:01.560 always set it for four am Eastern for whatever reason 0:01:01.600 --> 0:01:03.560 in my mind. That's just like that's when I wanted 0:01:03.600 --> 0:01:04.880 to show up and everyone's podcast. 0:01:05.040 --> 0:01:06.640 And even then it can show up like an hour 0:01:06.680 --> 0:01:07.360 to later or something. 0:01:07.240 --> 0:01:09.080 That, but at least it well, it depends on when 0:01:09.080 --> 0:01:12.200 your phone basically when whatever your app is reaching out 0:01:12.200 --> 0:01:13.200 for that data, right. 0:01:13.280 --> 0:01:14.240 But now we've got. 0:01:14.319 --> 0:01:16.679 Great listener questions to get to today. A listener is 0:01:16.720 --> 0:01:20.840 wondering what she should do about multiple retirement accounts. Maybe 0:01:20.840 --> 0:01:23.800 there's a way to simplify things. Another listener is wondering 0:01:23.840 --> 0:01:26.720 how to budget for a new home, specifically how to 0:01:27.280 --> 0:01:31.440 take into account the sale of their current home and managing. 0:01:31.080 --> 0:01:32.080 Your kids allowance. 0:01:32.200 --> 0:01:35.120 It's a little bit trickier than perhaps it seems on 0:01:35.160 --> 0:01:38.440 the surface. We'll get to those plus more personal finance 0:01:38.640 --> 0:01:40.240 topics during today's episode. 0:01:40.240 --> 0:01:42.600 The last one you mentioned is gonna also involve the 0:01:42.840 --> 0:01:46.559 digital versus analog divide. We'll give it to that as well, 0:01:46.800 --> 0:01:49.840 because there I think are pros and cons in both sections. 0:01:49.960 --> 0:01:52.680 But Matt, before we get to listener questions, we've got 0:01:52.680 --> 0:01:55.600 a listener email a couple of weeks ago from listener 0:01:55.640 --> 0:01:59.320 Brian and I don't know. I love getting emails from 0:01:59.360 --> 0:02:01.360 people who have not only made changes to their own 0:02:01.400 --> 0:02:04.760 personal finance life, but they're using what they've learned to 0:02:04.840 --> 0:02:08.720 help other people. And Brian, he said he's been listening 0:02:08.760 --> 0:02:10.519 for a long time, actually said, I think the first 0:02:10.520 --> 0:02:12.720 time he listened our episode was out of brewery in Atlanta. 0:02:12.840 --> 0:02:15.520 So well, that's perfect. Yeah, I know right, I must 0:02:15.520 --> 0:02:18.000 have missed the email. I didn't see it, so mad. 0:02:18.040 --> 0:02:20.520 Props to Brian slip through the cracks drinking good beer. 0:02:20.639 --> 0:02:22.360 But also one of the cool things he's done over 0:02:22.360 --> 0:02:26.240 the years is he's gotten more just interested in personal 0:02:26.280 --> 0:02:29.079 finance and his knowledge has grown. What he did was 0:02:29.120 --> 0:02:30.440 he went to his employer and he said, hey, listen, 0:02:30.520 --> 0:02:33.400 can I teach a personal finance class to the folks 0:02:33.440 --> 0:02:36.680 on my job? He's in law enforcement? And they were like, yeah, 0:02:36.720 --> 0:02:39.680 why not. I guess so and so he is like 0:02:40.200 --> 0:02:43.880 this has been like an effort wholly led by him, 0:02:44.040 --> 0:02:46.520 with now the approval of the superiors. That's so good. 0:02:46.560 --> 0:02:48.480 And he's getting emails now after leading some of these 0:02:48.520 --> 0:02:50.120 courses some of the people he's been working with who've 0:02:50.120 --> 0:02:52.400 been in that department for twenty plus years and they're saying, 0:02:52.560 --> 0:02:53.920 oh my gosh, I wish I had known this when 0:02:53.960 --> 0:02:56.440 I first started on the job. Just incredible, Like it's 0:02:56.680 --> 0:02:58.040 one thing to make a lot of change in your 0:02:58.080 --> 0:03:00.519 own personal life. It's something we applaud. It's incredile, but 0:03:00.600 --> 0:03:03.000 so nothing to pass it on, whether that's in an 0:03:03.000 --> 0:03:07.880 individual relationship to friend or family member, or to stranger 0:03:07.960 --> 0:03:11.200 sometimes I don't know, I random stranger combos about money 0:03:11.400 --> 0:03:13.560 every once in a while. And then to your coworkers, 0:03:13.560 --> 0:03:15.560 like the people you work with every day. To be 0:03:15.560 --> 0:03:17.440 able to pass out on is just beautiful. Totally. 0:03:17.480 --> 0:03:19.639 Yeah, I do think there's a big difference in feeling 0:03:19.800 --> 0:03:22.120 like that. You have to feel one hundred percent qualified 0:03:22.120 --> 0:03:23.720 to stand in front of a room of your peers 0:03:23.760 --> 0:03:27.200 and be able to explain safe withdrawal rates or something 0:03:27.360 --> 0:03:29.880 like a little more complicated like that, as opposed to 0:03:30.480 --> 0:03:32.640 having a conversation about money. And that's what we strive 0:03:32.720 --> 0:03:35.800 for here on the show is to basically make personal finances, 0:03:36.120 --> 0:03:38.920 to make money more common of a conversation, like we 0:03:38.960 --> 0:03:41.680 do not want it to remain a taboo topic and 0:03:41.720 --> 0:03:44.600 like it has so often, And even just asking a 0:03:44.640 --> 0:03:46.560 question if you're you don't have to be able to 0:03:46.600 --> 0:03:48.680 deliver all the information, but even just raising a question 0:03:48.760 --> 0:03:50.720 like that alone right there to the fact that you're 0:03:50.760 --> 0:03:53.320 showing curiosity. I think for some folks might be. 0:03:53.240 --> 0:03:54.360 One of the first times. 0:03:54.360 --> 0:03:56.280 It might be like the first time they've ever heard 0:03:56.320 --> 0:03:59.280 someone talk about money outside of like, oh, the price 0:03:59.280 --> 0:04:02.760 of gas or or something crazy superficial or a little 0:04:02.760 --> 0:04:05.720 bore shallow, right, and that in their mind stands out 0:04:05.760 --> 0:04:07.480 for you. You're listening to hot of money and so 0:04:07.520 --> 0:04:09.200 you hear this talked about all the time, but for 0:04:09.240 --> 0:04:12.040 them it might be something that has like completely been 0:04:12.160 --> 0:04:14.920 off of their radar, the fact that someone would actually 0:04:15.000 --> 0:04:16.679 want to talk about that and would have an interest 0:04:16.680 --> 0:04:19.640 in that. So, yeah, kudos was it, Brian? Brian, Brian 0:04:19.680 --> 0:04:22.279 for doing that, not to mention showing initiative like that 0:04:22.279 --> 0:04:22.640 at work. 0:04:22.720 --> 0:04:23.800 Yeah, that's how you. 0:04:23.839 --> 0:04:26.200 Get paid more seriously as well in promotion today. 0:04:26.520 --> 0:04:30.359 Oh, Brian's a very valuable member of Yeah, yes, I 0:04:30.400 --> 0:04:32.279 totally love that. The thing you mentioned, I think it's 0:04:32.279 --> 0:04:34.880 bears repeating is you don't have to be some sort 0:04:34.880 --> 0:04:37.200 of financial brainiac in order to pass on the information 0:04:37.240 --> 0:04:38.960 that you have, right, Yeah, you don't have to be like, 0:04:39.000 --> 0:04:40.720 I'm not as smart as Matt and you know what, 0:04:40.839 --> 0:04:42.159 I say that all the time, I'm not as smart 0:04:42.160 --> 0:04:44.440 as mental please, But you don't have to be that 0:04:44.560 --> 0:04:46.960 like brilliant off the chart one hundred and fifty IQ 0:04:47.040 --> 0:04:48.560 when it comes to money to be able to pass 0:04:48.600 --> 0:04:51.080 on what you know. And sometimes it's just saying like listen, wow, 0:04:51.080 --> 0:04:52.760 I heard this fact last week, or man, I didn't 0:04:52.800 --> 0:04:55.239 realize how good the HSA could be to a fellow 0:04:55.279 --> 0:04:58.359 cowork or whatever it is. It can be small, or 0:04:58.400 --> 0:05:00.599 it can be within the realm of what you know 0:05:00.680 --> 0:05:02.800 and what you know really well. You don't feel like 0:05:02.800 --> 0:05:05.240 you got to be some sort of like a trained 0:05:05.240 --> 0:05:07.160 financial professional in order to be able to tell other 0:05:07.160 --> 0:05:09.000 people some of the good stuff that you've been learning. 0:05:09.080 --> 0:05:12.120 That's right, speaking of HSA is that's actually one of 0:05:12.160 --> 0:05:14.359 the questions we're going to get to during today's episode. 0:05:14.360 --> 0:05:17.679 But first we have to introduce our first crappy beer 0:05:17.800 --> 0:05:20.359 of the episode, because we're going to enter into the 0:05:20.760 --> 0:05:23.040 what we do this for about three weeks or so 0:05:23.480 --> 0:05:26.279 of us drinking I'm I can't even call it craft beer, 0:05:26.360 --> 0:05:27.960 So it's going to be beer that isn't so great. 0:05:28.000 --> 0:05:28.880 It's called crap beer. 0:05:31.200 --> 0:05:35.200 We are today drinking a Covista, which is a Mexican 0:05:35.360 --> 0:05:40.120 style blogger courtesy of ald and So let's little background. 0:05:40.160 --> 0:05:42.839 The reason you and I are drinking these not so 0:05:42.960 --> 0:05:46.280 great craft beers is we had a friendly wager, a 0:05:46.320 --> 0:05:49.599 little friendly bet going on, and whoever raised the most 0:05:49.600 --> 0:05:52.920 money in our daffy campaigns. We had competing campaigns going 0:05:53.040 --> 0:05:56.920 where we were matching listener contributions and the loser was 0:05:56.960 --> 0:06:00.479 going to be stuck drinking the crappy stuff. And I 0:06:00.480 --> 0:06:03.200 think you beat me by like one hundred bucks or 0:06:03.240 --> 0:06:05.160 something like that. One hundred and fifty bucks, was that. 0:06:05.160 --> 0:06:07.159 Right, something something like that. But then you've got a 0:06:07.200 --> 0:06:09.599 donation like after the fact, and so you're like, you 0:06:09.640 --> 0:06:11.280 know what, neither of us hit the total we were 0:06:11.279 --> 0:06:12.839 going for. We're both gonna drink crap. 0:06:12.880 --> 0:06:14.840 Heer, Well, I was gonna throw you under the bus 0:06:14.880 --> 0:06:16.240 since you contributed to your own. 0:06:16.120 --> 0:06:19.640 Campaign, to your own campaign, I might have cheated jerk 0:06:19.839 --> 0:06:20.440 just a little bit. 0:06:21.080 --> 0:06:23.560 But that being said, the campaign pages are still up, 0:06:23.640 --> 0:06:25.599 and so if you want to hop over there, because 0:06:25.640 --> 0:06:28.640 maybe you completely miss those campaigns, there's still an opportunity 0:06:28.720 --> 0:06:31.159 for you to give to those campaigns, and we are 0:06:31.200 --> 0:06:33.839 still matching dollars and so you still have the ability 0:06:33.880 --> 0:06:35.839 to change lives and give some of your money away. 0:06:35.880 --> 0:06:37.600 So for real, seriously, thank you to everyone who did 0:06:37.600 --> 0:06:40.520 donate to those campaigns. Yeah, you still can, and we're 0:06:40.560 --> 0:06:42.760 just excited to get the match dollars that get donated 0:06:42.839 --> 0:06:44.640 some of our favorite nonprofits. So we'll just leave them 0:06:44.640 --> 0:06:47.600 live until hopefully we reach the total. You still want 0:06:47.600 --> 0:06:49.480 folks to be able to participate. It doesn't have to 0:06:49.520 --> 0:06:51.039 be to the charities that Matt and I love, but 0:06:51.320 --> 0:06:53.360 if you like those charities, we'll guess what your donation 0:06:53.400 --> 0:06:56.800 gets doubled still, so we'll link to those again in 0:06:56.839 --> 0:06:59.320 the show notes for this for this episode. But Matt, 0:06:59.360 --> 0:07:01.479 let's move on. Let's get to listener questions. If you 0:07:01.520 --> 0:07:02.960 have a money question and you're like I would love 0:07:02.960 --> 0:07:05.120 Matt and Joel to tackle this on an upcoming episode. 0:07:05.400 --> 0:07:06.760 We'd love to hear it. Just got to have the 0:07:06.800 --> 0:07:09.320 money dot com, slash ask or basically record a voice 0:07:09.360 --> 0:07:11.640 memo on your phone send it our way. Hopefully we'll 0:07:11.640 --> 0:07:15.200 take it next week on the show. This first question, though, Matt, 0:07:15.240 --> 0:07:18.280 comes from a listener in Texas who's thinking upgrade in 0:07:18.320 --> 0:07:18.680 their house. 0:07:19.040 --> 0:07:21.960 Hi, Matt and Joel, this is Tanya from Tyler, Texas. 0:07:22.160 --> 0:07:24.120 I have a question regarding how to budget for a 0:07:24.160 --> 0:07:27.400 new home when factoring and selling a starter home. We 0:07:27.520 --> 0:07:29.960 bought our starter home back in twenty eleven and says 0:07:29.960 --> 0:07:32.400 sin and has more than double in value. We also 0:07:32.440 --> 0:07:34.280 don't owe very much on it, as we always put 0:07:34.280 --> 0:07:38.040 a little extra towards it each month. It is quite small, 0:07:38.160 --> 0:07:41.520 but hasn't felt that way until recently. My husband works 0:07:41.560 --> 0:07:44.040 from home now and we had our first baby last year. 0:07:44.520 --> 0:07:47.360 We're hoping to add another soon. We're wanting to purchase 0:07:47.360 --> 0:07:51.040 our next home, possibly our forever home, for our growing family, 0:07:51.400 --> 0:07:54.240 something a little larger and with a better office space, 0:07:54.600 --> 0:07:56.680 but I'm stuck on figuring out what we can afford 0:07:56.720 --> 0:07:59.680 after selling our starter home. What advice do you all have? 0:08:00.400 --> 0:08:02.800 Thank you for all you do. You're ever niece Texas. 0:08:03.120 --> 0:08:05.800 Check out Truebne Brewery and Tyler first round. 0:08:05.560 --> 0:08:08.960 On this Ooh, Tanya, a very generous offer. We'll have 0:08:09.000 --> 0:08:11.240 to We might actually take you up on that next 0:08:11.240 --> 0:08:13.960 time we make it down to the great state of Texas. 0:08:14.080 --> 0:08:15.920 It's been a little bit longer, Joe since you've been there. 0:08:16.080 --> 0:08:19.160 That's where there's a deal to what was it? South 0:08:19.200 --> 0:08:22.040 Padre Island is where I took my family to got 0:08:22.040 --> 0:08:22.880 that Southwest deal. 0:08:22.920 --> 0:08:25.320 I'm no Spanish expert, but I will say that probably 0:08:25.320 --> 0:08:27.480 means South Dad Island. 0:08:28.000 --> 0:08:29.800 You do no more Spanish than me, and so I 0:08:29.880 --> 0:08:34.959 will have to be further to appropriate. Let's just get 0:08:34.960 --> 0:08:38.760 to it. Tanya's question, because she mentioned several great pieces 0:08:38.760 --> 0:08:40.960 of information in here. By the way, she bought her 0:08:41.040 --> 0:08:44.360 house in twenty eleven, that's awesome because that means she 0:08:44.440 --> 0:08:48.240 bought a great time obviously before home prices shot up, 0:08:48.240 --> 0:08:51.000 but that's back when rates interest rates were low, mortgage 0:08:51.040 --> 0:08:53.120 rates specifically. But it also means because it was so 0:08:53.160 --> 0:08:55.400 long ago, it means that you have more than crossed 0:08:55.440 --> 0:08:57.320 the threshold of how long we would like to see 0:08:57.320 --> 0:09:00.200 folks commit to living in a home that they buy. 0:09:00.679 --> 0:09:03.040 And because you've owned the home for I guess thirteen 0:09:03.120 --> 0:09:05.440 years now, you have avoided one of the biggest pain 0:09:05.480 --> 0:09:09.440 points that other American homeowners who upgrade homes regularly that 0:09:09.480 --> 0:09:13.280 they face, which are over the top real estate transaction costs. 0:09:13.400 --> 0:09:17.440 This is a real wealth drainer. It doesn't get mentioned enough. 0:09:17.480 --> 0:09:21.200 And again, given the recent changes to how it does 0:09:21.400 --> 0:09:23.960 that realtors are getting paid, that might be going away 0:09:24.000 --> 0:09:26.720 and there might be a little more fluidity when it 0:09:26.760 --> 0:09:29.240 comes to the housing market, but for the longest time. 0:09:29.360 --> 0:09:31.600 That is one of the reasons we want folks to 0:09:31.600 --> 0:09:34.440 stay in their homes for at least three ideally five 0:09:34.480 --> 0:09:35.000 plus years. 0:09:35.080 --> 0:09:37.480 Yeah five to seven, really, I mean minimum three. I 0:09:37.480 --> 0:09:39.040 mean I don't even know if you're gonna If you 0:09:39.040 --> 0:09:40.280 said I'm gonna buy a home and sell it three 0:09:40.320 --> 0:09:43.880 years from now, I always say, don't do it. Interestingly enough, 0:09:43.920 --> 0:09:46.760 twenty eleven was kind of the trough matt for home prices, 0:09:46.800 --> 0:09:49.160 so sure there really wasn't a better time to buy 0:09:49.200 --> 0:09:51.920 anytime in that twenty ten twenty eleven period. You were 0:09:51.960 --> 0:09:55.360 getting just the lowest prices in a generation, I think 0:09:56.000 --> 0:09:57.120 for home prices. 0:09:57.160 --> 0:09:59.120 I remember owning for a couple of years and seeing 0:09:59.520 --> 0:10:02.080 home value is on Zillo continue to decline, and I 0:10:02.080 --> 0:10:04.360 remember thinking, ill, I don't know, did we make the 0:10:04.800 --> 0:10:07.520 right move because we jumped in back when there is 0:10:07.600 --> 0:10:10.640 a non refundable tax credit because the year in two 0:10:10.679 --> 0:10:13.040 thousand and eight you had to pay that tax credit 0:10:13.160 --> 0:10:15.480 back two thousand and nine. They said, you know what, 0:10:15.559 --> 0:10:16.480 you just hang on to that. 0:10:16.600 --> 0:10:16.800 Yeah. 0:10:16.800 --> 0:10:18.640 I think that's when both of us, prior to even 0:10:18.679 --> 0:10:22.040 knowing each other, said now's the time to buy Relic. 0:10:22.600 --> 0:10:24.400 She made an even better decision Relic from a bike 0:10:24.480 --> 0:10:27.080 on era Like, we don't know, no sort of support 0:10:27.160 --> 0:10:30.200 system in place for want to be homeowners now, But 0:10:30.960 --> 0:10:33.720 big props to you Tanya for making a good purchase 0:10:33.760 --> 0:10:36.280 and for holding onto that purchase for so long, and 0:10:36.920 --> 0:10:39.120 matt Tiny is also not alone in trying to make 0:10:39.120 --> 0:10:43.360 her current homework the golden handcuffs of a reasonable mortgage 0:10:43.360 --> 0:10:46.280 and a low rate. Plus if you were to run 0:10:46.320 --> 0:10:49.160 the numbers of buying a more expensive home, not just 0:10:49.280 --> 0:10:52.120 the increased price, but now at a seven plus percent rate, 0:10:52.440 --> 0:10:54.160 that's made a lot of people feel grateful for what 0:10:54.200 --> 0:10:54.480 they have. 0:10:55.040 --> 0:10:57.960 And it's not that Tanya isn't grateful, but you know 0:10:58.000 --> 0:11:00.319 what I mean, right Like she's She's like, I'll take 0:11:00.320 --> 0:11:01.600 the bird in the hand, and maybe I'll hold on 0:11:01.600 --> 0:11:04.560 to that because it is such a blessing to my 0:11:04.640 --> 0:11:07.839 monthly budget. It will make you want to hold off 0:11:07.920 --> 0:11:10.839 on upgrading as long as possible. But at some point, 0:11:11.040 --> 0:11:12.360 I think this is true, and I think we're going 0:11:12.440 --> 0:11:15.320 to see more people moving on from low rates in 0:11:15.520 --> 0:11:18.600 the future because at some point, no matter how good 0:11:18.600 --> 0:11:21.240 of a deal you've got, with your families growing and 0:11:21.440 --> 0:11:23.160 let's say somebody else is working from home and more 0:11:23.200 --> 0:11:25.520 space becomes a necessity, you got to bite the bullet. 0:11:25.520 --> 0:11:27.920 You gotta do something, because at some point it becomes 0:11:28.000 --> 0:11:31.200 untenable to continue to cram more people into that same 0:11:31.200 --> 0:11:31.760 small space. 0:11:31.920 --> 0:11:35.160 Yeah, So let's do our best to offer a few solutions. Antonya, 0:11:35.200 --> 0:11:38.360 I think one thing that's worth considering is outside of 0:11:38.400 --> 0:11:40.720 the realm of maybe what you're considering at the moment, 0:11:40.760 --> 0:11:43.920 which is to renovate your current home instead of buying 0:11:43.960 --> 0:11:47.080 another again with the mortgage rate that you've gotten, with 0:11:47.200 --> 0:11:50.400 the massive amount of equity that you have, I think 0:11:50.600 --> 0:11:53.000 it's worth considering whether or not it would make sense 0:11:53.040 --> 0:11:55.640 to get some plans r on up, maybe interview some contractors, 0:11:55.679 --> 0:11:58.400 try to increase the square footage of your current home. 0:11:58.520 --> 0:12:01.120 This is literally something that Kate and I are in 0:12:01.160 --> 0:12:03.800 the middle of doing right now, because when we moved 0:12:03.880 --> 0:12:06.880 up to where we're living now, we basically we saw 0:12:06.920 --> 0:12:09.959 our current home as a temporary move. We thought, all right, 0:12:10.000 --> 0:12:12.240 we'll make that happen, living it for a couple of years, 0:12:12.480 --> 0:12:15.280 possibly rent it for a few years after that before 0:12:15.280 --> 0:12:17.959 we sell it. But given where mortgage rates are, given 0:12:18.120 --> 0:12:21.120 the lack of inventory on the market. In bottom line, 0:12:21.280 --> 0:12:22.840 I think over time, we've realized that there is a 0:12:22.840 --> 0:12:26.000 lot to love about our current home. Essentially, we kind 0:12:26.000 --> 0:12:29.319 of came into it with a snobbish attitude. We're thinking, 0:12:29.400 --> 0:12:31.080 wait a minute, this home isn't at least one hundred 0:12:31.120 --> 0:12:33.920 years old, with loads of charm and character. 0:12:33.720 --> 0:12:34.720 And ten foot ceilings. 0:12:35.120 --> 0:12:37.040 And because of that, I think we were like, we're 0:12:37.080 --> 0:12:39.160 not going to be here for all that long. But 0:12:39.559 --> 0:12:41.840 now we're realizing, oh, you know what, we actually might 0:12:41.880 --> 0:12:44.400 be here for a decade plus. We could be here 0:12:44.480 --> 0:12:47.720 until we're empty nesters, which is mind blowing to think through. 0:12:47.880 --> 0:12:50.120 And so we're starting to take steps. We have been 0:12:50.120 --> 0:12:52.440 taking steps to see what it would take in order 0:12:52.480 --> 0:12:55.800 to make this particular home work for us rather than 0:12:55.960 --> 0:13:00.480 moving and man just completely being forced to pay so 0:13:00.600 --> 0:13:04.400 much more every single month, do specifically to hire mortgage rates. 0:13:04.440 --> 0:13:06.840 Yeah, and part of that has been you've actually started 0:13:06.840 --> 0:13:09.000 to enjoy your house more and you like your neighborhood. 0:13:09.040 --> 0:13:10.480 You like your neighbors. And then the other part of 0:13:10.520 --> 0:13:12.640 that is the economic, the money side of the equation. 0:13:12.920 --> 0:13:15.640 And it's like, Okay, all these plos together. If I 0:13:15.640 --> 0:13:17.760 want the slightly bigger house with a little bit more room, 0:13:17.800 --> 0:13:20.480 an extra bedroom for the next kid, you're giving up 0:13:20.640 --> 0:13:22.560 the super lowl mortgage that you have locked in. And 0:13:23.160 --> 0:13:26.720 you're in a similar position to Tanya. And it's lifestyle 0:13:26.760 --> 0:13:29.000 and financial, it's both, it's both, and you've got a 0:13:29.000 --> 0:13:31.400 factor in both, right. I guess the lifestyle part is 0:13:31.440 --> 0:13:35.160 the aspect Tanya, that it's worth thinking through. Like the 0:13:35.200 --> 0:13:36.720 way we were thinking about it is that like, well, 0:13:36.720 --> 0:13:39.320 this isn't a dream house, this isn't this isn't going 0:13:39.360 --> 0:13:42.120 to be a forever home. But I guess the question 0:13:42.200 --> 0:13:44.120 I'm posing is to think through because the home that 0:13:44.120 --> 0:13:46.160 you're in it it could be, It could be, and 0:13:46.200 --> 0:13:49.559 your priorities might change, and maybe in the past you're thinking, oh, 0:13:49.559 --> 0:13:52.040 this isn't our forever home. And let's be honest, nobody's 0:13:52.080 --> 0:13:54.600 home is actually their forever home. It's like, okay, more 0:13:54.600 --> 0:13:56.200 of a long term home than maybe you thought. But 0:13:56.240 --> 0:13:58.640 your priorities changed and the things that you care about change. 0:13:58.840 --> 0:14:01.280 So part comes up what it is that you are 0:14:01.400 --> 0:14:03.640 valuing these days in your life. Yeah, and maybe you've 0:14:03.640 --> 0:14:05.480 got a big enough lot where you can add on, 0:14:05.679 --> 0:14:09.160 and the way the house flows and stuff, maybe your 0:14:09.160 --> 0:14:12.280 house is ripe for a renovation, and maybe that's also 0:14:12.679 --> 0:14:15.400 the best fiscal move for you as well. You might 0:14:15.440 --> 0:14:16.920 find that you can take out a helock in order 0:14:16.920 --> 0:14:18.839 to add on to the house, giving you all the 0:14:18.880 --> 0:14:20.760 room that you need, right, allowing you to hang on 0:14:20.800 --> 0:14:23.400 to the current mortgage, which is essentially like free money 0:14:23.440 --> 0:14:26.640 if you got it back in twenty eleven and then right, 0:14:26.640 --> 0:14:28.720 and then you can simultaneously pay off the helock in 0:14:28.760 --> 0:14:30.720 just a few years time. That could be the slam 0:14:30.760 --> 0:14:33.200 dunk decision. There could be a lot of other reasons 0:14:33.200 --> 0:14:35.400 maybe why you wouldn't make that choice. I mentioned a 0:14:35.400 --> 0:14:36.840 lot of size. Let's say you're on a post it's 0:14:37.440 --> 0:14:40.280 stamp sized lot, something really really small, and you're like, nah, 0:14:40.280 --> 0:14:43.040 it just doesn't work, or actually I want to home 0:14:43.120 --> 0:14:45.440 with bigger bones in general, but we at least wanted 0:14:45.440 --> 0:14:47.320 to float that idea because it can make a lot 0:14:47.360 --> 0:14:50.000 of financial sense given the current market condition. So if 0:14:50.040 --> 0:14:51.880 you like where you live and you feel like your 0:14:51.880 --> 0:14:55.160 house has the ability to it's got the potential to 0:14:55.200 --> 0:14:57.040 be something great for your family for a long time, 0:14:57.120 --> 0:14:59.600 it's just in its current state, it's not quite there. 0:15:00.400 --> 0:15:03.000 At least think through that. Yeah, and plus it sounds 0:15:03.040 --> 0:15:05.520 like that maybe everything else about the house or like 0:15:05.520 --> 0:15:07.360 the neighborhood is working out for her, because what she's 0:15:07.360 --> 0:15:11.120 specifically mentioning is the square footage, not that actually we 0:15:11.160 --> 0:15:13.040 want to be closer to in laws. Oh, there's a 0:15:13.200 --> 0:15:15.920 job relocation that's requiring us to move that sort of thing. 0:15:16.440 --> 0:15:19.280 And so truly, if it is about space, maybe you 0:15:19.320 --> 0:15:20.800 are actually in the home that you're going to be 0:15:20.800 --> 0:15:23.640 in for the next little while, but maybe there is 0:15:23.680 --> 0:15:26.040 a bunch of other information that you didn't share with us. 0:15:26.080 --> 0:15:28.880 Let's say you are going to actually purchase a different home, 0:15:29.120 --> 0:15:31.560 a new to you house that is, well, how much 0:15:31.800 --> 0:15:34.520 should you spend? Well, first of all, take what the 0:15:34.560 --> 0:15:36.240 lender says with a grain of salt, because you're going 0:15:36.280 --> 0:15:40.000 to start getting pre approved for loan amounts and you 0:15:40.000 --> 0:15:42.720 want to make sure that you keep your housing expenses reasonable. 0:15:43.040 --> 0:15:44.440 And if you go all the way up to your 0:15:44.480 --> 0:15:47.440 pre approved limit, it's going to feel way too tight 0:15:47.440 --> 0:15:49.960 when it comes to your month and month, your sort 0:15:49.960 --> 0:15:51.520 of day to day living, and what you're going to 0:15:51.520 --> 0:15:52.800 be spending. In that sense, that's why they call a 0:15:52.800 --> 0:15:55.800 house formatt that's right, and in all likelihood, you're going 0:15:55.880 --> 0:15:58.200 to want to put down most, if not all, of 0:15:58.200 --> 0:16:00.800 the proceeds of your current home towards that next house. 0:16:01.120 --> 0:16:03.080 I think if if rates were a good bit lower, 0:16:03.400 --> 0:16:06.040 that advice actually it probably would be different. But I'd 0:16:06.120 --> 0:16:08.720 rather take on as little mortgage debt as possible at 0:16:08.760 --> 0:16:11.200 seven and a half percent, and because of that big 0:16:11.240 --> 0:16:13.120 equity chunk, you might even be able to keep your 0:16:13.120 --> 0:16:16.440 mortgage payment very similar in size, which would I think 0:16:16.600 --> 0:16:18.440 probably be sort of the ultimate goal for you. 0:16:19.040 --> 0:16:21.200 But this is a crude rule of. 0:16:21.160 --> 0:16:22.840 Thumb, but bottom line, you want to make sure that 0:16:22.840 --> 0:16:25.120 your payment is less than thirty percent of your take 0:16:25.120 --> 0:16:27.920 home pay, and honestly even less than that. If you 0:16:27.960 --> 0:16:30.280 can keep it closer to twenty five percent, then that 0:16:30.320 --> 0:16:34.080 would be even better. But let's say, for instance, you're 0:16:34.080 --> 0:16:36.920 monthly after tax pay is something like six thousand dollars, 0:16:36.920 --> 0:16:40.280 Well we're talking about an eighteen hundred dollars mortgage payment, 0:16:40.600 --> 0:16:42.920 assuming that you're sticking with that thirty percent goal. 0:16:43.000 --> 0:16:45.080 Yeah, yeah, I think that's a I think it's a 0:16:45.120 --> 0:16:48.920 reasonable approach, and of course it's harder than ever to 0:16:48.960 --> 0:16:52.360 pull off, given the current housing market and how out 0:16:52.400 --> 0:16:56.160 of control costs and rates have become. But at least 0:16:56.280 --> 0:16:58.760 Tanya's got one thing in her corner, which is a 0:16:58.760 --> 0:17:01.200 ton of home equity, which I think can help maybe 0:17:01.200 --> 0:17:02.920 defray some of the costs of the upgrade. 0:17:02.920 --> 0:17:04.240 So, yeah, you just want the ability to get that 0:17:04.280 --> 0:17:05.680 loan amount down even further. 0:17:05.720 --> 0:17:06.440 That's going to be huge. 0:17:06.520 --> 0:17:08.520 Yep, because that's I will say too. This is the 0:17:08.680 --> 0:17:11.240 like what the typical average American is going to do. Right, 0:17:11.320 --> 0:17:13.720 Like you, you start off with a home, take the 0:17:13.720 --> 0:17:15.159 equity out of that home, you roll it into the 0:17:15.160 --> 0:17:19.120 next one. And there's nothing wrong with that, although we do, 0:17:19.400 --> 0:17:22.280 I guess we want to push you to consider other alternatives, 0:17:22.520 --> 0:17:24.439