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Speaker 1: Welcome to Hout of Money. I'm Joel, I'm Matt. Today

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Speaker 1: we're answering your listener questions. I'll get you switching things

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Speaker 1: up with a little more staccato with my delivery. You

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Speaker 1: were happy Monday every time. That was just my AI voice.

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Speaker 1: Oh please. AI voices now are seamlessly human. If you've

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Speaker 1: listened to any of the Google's Notebook podcast creators, it

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Speaker 1: sounds like what was.

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Speaker 2: That app we were messing with when Chris Hutchins came

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Speaker 2: to visit us.

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Speaker 1: That's what it was. Oh yeah, so like you can,

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Speaker 1: you can input a bunch of data and then we'll

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Speaker 1: create what they think a podcast is. So he had one.

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Speaker 2: Where you could essentially use AI to be an assistant

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Speaker 2: and call people on your behuse and have a conversation.

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Speaker 1: I forget what that was. That was Ray. I still

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Speaker 1: don't believe that there wasn't somebody sitting in a call center,

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Speaker 1: because I could hear like the call center of people

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Speaker 1: behind them.

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Speaker 2: I have mostly insulated myself from the realities of artificial intelligence.

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Speaker 2: I don't use it myself in any meaningful way, and

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Speaker 2: so to see that I was like, oh my gosh, if.

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Speaker 1: This is real, this has gotten good some of the

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Speaker 1: Google products that are being rolled out where they are

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Speaker 1: creating a podcast from scratch, and they are mimicking what

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Speaker 1: they think a podcast should sound like, with the little

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Speaker 1: things that you and I tend to say, like in

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Speaker 1: between sentences where we're interjecting odd little sounds and affirmations,

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Speaker 1: things like that.

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Speaker 2: The groans I make when you speak sometimes oh yeah, things.

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Speaker 1: Like that, for instance, Like they're totally incorporating that, which

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Speaker 1: is kind of mind blowing. Yeah. No, this is a

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Speaker 1: listener question Monday, and we've got a lot of investing

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Speaker 1: questions to get to today. A listener bought some S

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Speaker 1: and P five hundred and now they're asking like, what

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Speaker 1: do I do now? It's more of a beginner investing question.

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Speaker 1: Another listener is asking about investing a home down payment.

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Speaker 1: This is sort of a medium sort of level investing question.

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Speaker 1: Also a medium term goal that they're saving four and

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Speaker 1: so we've got all different levels. Here's a more pro

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Speaker 1: level question. Someone is asking about whether they should take

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Speaker 1: the lump sum versus the monthly pension amount. So we're

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Speaker 1: going to crunch some numbers. Yeah you want this question desperately. Yeah, Yeah,

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Speaker 1: we'll get to it. We'll get to it, No need

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Speaker 1: to get ahead of ourselves.

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Speaker 2: Well, and we asked for that question specifically, or you

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Speaker 2: did because I went to somebody else for my advice

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Speaker 2: on that and you were devastated.

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Speaker 1: So I'm claud. We get to tackled that on.

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Speaker 2: Today's show, but before we get to them, I just, Matt,

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Speaker 2: I just want to mention we have a new article

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Speaker 2: up on the website about something called rent vesting. I

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Speaker 2: think it's a new term for something people have been doing,

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Speaker 2: probably for that at least some people have participated in

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Speaker 2: at different points in time where instead of buying a

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Speaker 2: primary residence, you continue renting and the home that you're

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Speaker 2: saving up, the home that you actually buy is located

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Speaker 2: elsewhere and it's your first rental property.

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Speaker 1: Which I didn't think there were maybe that many folks

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Speaker 1: that did that until I started thinking for a second.

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Speaker 1: And actually so we talked with was it last week

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Speaker 1: or two weeks last week that we've been with Dave Meyer?

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Speaker 1: And that's what he's technically doing right now. He's living

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Speaker 1: in Europe and renting over there. But there's a many

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Speaker 1: properties here stateside. But I will say I do think

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Speaker 1: this is probably a difficult thing for a lot of

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Speaker 1: folks to do. If you are looking to purchase an

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Speaker 1: investment property that is a long distance, right, like best

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Speaker 1: case scenario, it's somewhere where you used to live, so

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Speaker 1: you're familiar with the area. Maybe you were able to

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Speaker 1: get that lower mortgage rate because it was a primary

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Speaker 1: for you, and now you've moved on. You know you're

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Speaker 1: living somewhere else, but you've held onto that as an investment.

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Speaker 1: I think that's kind of like the best case scenario,

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Speaker 1: but I think it's a lot tougher if you're thinking,

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Speaker 1: if you are currently living somewhere that's really expensive, you

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Speaker 1: want to diversify, you want to get into real estate,

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Speaker 1: and you're thinking, let me buy in this town that

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Speaker 1: I've never been to before, or maybe I've only been

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Speaker 1: there once. Like, that's tricky, man. Like there's a whole

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Speaker 1: lot of work that goes into I guess getting that

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Speaker 1: framework and that team together to where you can make

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Speaker 1: that prea You've.

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Speaker 2: Talked about the importance of having a team if you're

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Speaker 2: going to invest remotely, and so yeah, I think you're right.

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Speaker 2: Like rent vesting is possible. We've had an article about

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Speaker 2: it up on the website about it. I think people

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Speaker 2: should check it out if if they're interested, because if

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Speaker 2: you do live in one of those high cost of

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Speaker 2: living locations, like you might be saying, I think we

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Speaker 2: like we took a listener question recently from someone living

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Speaker 2: in New Jersey and they're like, it's really really expensive here,

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Speaker 2: so maybe you keep renting, and maybe you do. If

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Speaker 2: you really want to own real estate, then you buy

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Speaker 2: it elsewhere. But you're right, there are some hurdles there.

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Speaker 2: We outline that in the piece.

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Speaker 1: But what's great there it might be we're jumping over

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Speaker 1: so our buddy O'Leary, that's what I'm gonna I'm gonna

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Speaker 1: start calling him that because yeah, just to keep things

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Speaker 1: nice and simple. But he's currently doing this, which is

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Speaker 1: what's so cool about about that particular article. He's actually

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Speaker 1: speaking from personal experience there. But I know he lives

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Speaker 1: in California and owns property in Texas, an expensive part

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Speaker 1: of California, a fancy part of LA and he's.

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Speaker 2: Never lived in Texas, so it's not like he did

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Speaker 2: it because I used to live there. That's true, and

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Speaker 2: he's he's done decently well.

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Speaker 1: Although again I do think that that is a workable

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Speaker 1: situation where you are familiar enough with a town, or

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Speaker 1: like if it's your hometown and you and you have

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Speaker 1: an excuse to go back there. You're going back there

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Speaker 1: over Christmas or the holidays, right, okay, let me go

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Speaker 1: check in on the property. Basically, if this is like

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Speaker 1: a Hallmark Christmas movie and which are my favorite? And

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Speaker 1: you're like living in the fancy city, but then you

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Speaker 1: go home to visit your folks over the holidays. But

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Speaker 1: but twist in the plot, your high school girlfriend is

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Speaker 1: actually your tenant, and now you've got a victor? What

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Speaker 1: do you do? Right? Oh? That would be I would

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Speaker 1: watch that one, would you? Yeah? Okay, you're the high

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Speaker 1: powered I've never want a female attorney. And you go

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Speaker 1: back home and oh, man, the guy you had a

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Speaker 1: crush on in high school who happens to be a

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Speaker 1: hot fireman living in your property trying to raise his

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Speaker 1: two kids, what do you do? Wow? You could talk.

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Speaker 2: I feel like you've got a job in Hollywood coming

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Speaker 2: up with these plots. I don't watch the me neither

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Speaker 2: Hallmark channel, but I think I know what they're about.

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Speaker 1: Though.

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Speaker 2: Yeah, I think you've kind of down down pat All right, Well,

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Speaker 2: just letting you know. We'll link to that piece in

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Speaker 2: the show notes. And it's just kind of an interesting

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Speaker 2: way to think about starting your real estate spree if

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Speaker 2: you're interested in going that direction, if you feel like

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Speaker 2: the stakes are too high where you actually live totally.

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Speaker 1: Matt.

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Speaker 2: Let's mention the beer we're having on this episode. It's

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Speaker 2: called Breakfast Anti Meridium. It is an Imperial brown ale

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Speaker 2: with lots of goodies.

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Speaker 1: Thrown in there.

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Speaker 2: Heck yeah, wow, it smells delicious. So we'll give our

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Speaker 2: thoughts on this one at the end of the episode.

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Speaker 2: But let's take your listener questions and if you have

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Speaker 2: a money question, we would love to hear it. Just

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Speaker 2: record it on the voice memo of your app send

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Speaker 2: it over our way. We are giving away how to

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Speaker 2: money socks Matt for anybody who sends over a question

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Speaker 2: that we take on the podcast through the end of

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Speaker 2: the year that how to money socks are coveted, they

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Speaker 2: are comfy, they are We'll show everyone in the world

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Speaker 2: and around you that you have style. So send us

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Speaker 2: your listener question. We'd love to hear it. You can

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Speaker 2: find the instructions at how toomoney dot com slash ask

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Speaker 2: Let's get to a question, the question you have been

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Speaker 2: waiting for Matt about whether or not to take a

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Speaker 2: pension or to grab that lumps home.

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Speaker 3: Hey, Matt and Joel, this is Trent from Uri in Washington.

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Speaker 3: I was so excited to hear you guys talk about

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Speaker 3: the lump sum versus pension options on last week's show,

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Speaker 3: as thats my number one retirement question currently. I thought

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Speaker 3: about sending this question to my other podcast friends, but

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Speaker 3: when I heard how crushed Matt was that he didn't

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Speaker 3: get to help run Jewels numbers, how can I not

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Speaker 3: send this question to Matt? Okay, So here's my options

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Speaker 3: for my monthly pension. I have the option of two

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Speaker 3: one hundred and twenty nine dollars a month, and that

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Speaker 3: is with a seventy five percent survivorship to my wife.

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Speaker 3: My lump sum option would be five hundred and sixty

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Speaker 3: seven one hundred and forty seven dollars and I would

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Speaker 3: run that out to about the mid nineties, so let's

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Speaker 3: say aged ninety five. If you guys could tell me

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Speaker 3: how to calculate this or run the numbers and give

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Speaker 3: me your opinion, I sure would appreciate it. As far

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Speaker 3: as other retirement assets, I have a little bit over

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Speaker 3: two million dollars and some investments such as Roth's traditional

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Speaker 3: iras HSA's and the majority being in a four to

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Speaker 3: zher one K. And then I have about one hundred

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Speaker 3: and fifty four thousand dollars in cash that I plan

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Speaker 3: to live on my first year in retirement and possibly

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Speaker 3: why a used car. I plan to retire hopefully next

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Speaker 3: year at the age of fifty five. So again, if

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Speaker 3: you guys can give me your opinion, I surely would

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Speaker 3: appreciate it. Have a great day.

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Speaker 1: Woo, finally somebody that trusts me. Trend do you want

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Speaker 1: to be my best friend?

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Speaker 2: I trust you, all right, yeah, And I don't know.

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Speaker 2: Maybe I'll get your recheck with my numbers if if

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Speaker 2: you're interested.

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Speaker 1: Well, and it's ill see we'll see if we arrived

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Speaker 1: at different answers to to Trent's questions, and you might

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Speaker 1: be like, oh, actually I didn't think about that. That's

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Speaker 1: some good insights. I hadn't really thought about that.

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Speaker 2: Well, I'm glad you finally have a lump sum versus

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Speaker 2: like pension questions served up to you.

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Speaker 1: Matt, like you deserve this question. The numbers man, that's

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Speaker 1: what it's all about. I love it because there's no

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Speaker 1: bias when it comes to number like is it's just

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Speaker 1: black and white when it comes to numbers. Obviously, even

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Speaker 1: that there's still a lot. There's a lot.

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Speaker 2: There's a lot of numbers that need to be considered here.

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Speaker 2: I'm gonna say, sure, there's the numbers are import but

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Speaker 2: then how those numbers impact your lifestyle, how you live,

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Speaker 2: and the risk reward ratio, and how the factors into

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Speaker 2: your psychology that's important too.

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Speaker 4: Right.

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Speaker 1: Numbers just give you a solid foundation to work from though,

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Speaker 1: right otherwise it just feels like you're building an argument

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Speaker 1: or making a case on squishy, swampy ground as opposed

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Speaker 1: to something that's rock solid. You know that, Like, Okay,

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Speaker 1: at the very least we know whatever it is that

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Speaker 1: these numbers say that we can count on that.

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Speaker 2: The numbers are informative. And if you don't run the numbers, yeah,

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Speaker 2: you're liable to make a gut reaction.

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Speaker 1: That's not good.

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Speaker 2: But if you run the numbers, then I think it

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Speaker 2: can and factor in those other things, then it can

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Speaker 2: help you make a wise decision. And massive congrats by

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Speaker 2: the way to Trent on being able to retire at

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Speaker 2: fifty five. That's incredible. He's obviously got his money stuff together.

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Speaker 2: He's made a lot of smart decisions over the course

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Speaker 2: of many years to set himself up for this ability,

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Speaker 2: and I just appreciate his optimism. Also Matt on life expectancy.

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Speaker 2: Trent plans on getting pretty close to centenarian status.

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Speaker 1: I dig it.

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Speaker 2: See living in a blue zone there. I don't know

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Speaker 2: if state of Washington is in a blue zone. But Trent,

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Speaker 2: you get there, hope you achieve it. He wants to

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Speaker 2: live with Mathuzla Age that was the oldest person in

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Speaker 2: the Heabre Bible, in the Old Testament. So yeah, well,

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Speaker 2: I don't think he's actually going to get to I

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Speaker 2: think he was like nine hundred and something years old,

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Speaker 2: So I don't think Trent's actually going to make it

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Speaker 2: that one.

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Speaker 1: By the way, did you notice that Trent this multimillionaire,

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Speaker 1: He's planning on buying a used car. I don't know

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Speaker 1: if you if you heard that, Trent is obviously our

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Speaker 1: kind of guy. I actually do think I could be

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Speaker 1: friends with Trent. But let's get down to the numbers.

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Speaker 1: Let's get down to business. There are so many different

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Speaker 1: elements that factor into this decision and five hundred and

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Speaker 1: sixty thousand dollars in one lump sum specifically, I think

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Speaker 1: he said five hundred and sixty seven one hundred and

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Speaker 1: forty seven dollars. Gotta be specific here. That is a

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Speaker 1: massive chunk of money. But the certainty of two one

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Speaker 1: hundred and twenty nine dollars a month in perpetuity for

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Speaker 1: potentially four decades, that is, that's that's pretty sweet as well, true,

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Speaker 1: especially if he lives beyond that ninety five yeah you live, Yeah,

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Speaker 1: But which one makes the most sense? Well, when you

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Speaker 1: run the numbers. And by the way, so Trent, he

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Speaker 1: actually sent along a site called honest Math, which looks awesome.

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Speaker 1: I read up on it and it was started by

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Speaker 1: somebody who's in the industry and was looking for a

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Speaker 1: product that was out there that was non biased, that

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Speaker 1: wasn't trying to sell people things, and so which is

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Speaker 1: why they called it honest Math. I could see that

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Speaker 1: being a great resource for a lot of folks. But

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Speaker 1: also Schwab, they've got a great calculator where I didn't

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Speaker 1: have to create an account to access the calculators. I

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Speaker 1: just did that. But when you crunch the numbers, you

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Speaker 1: find that the lump some it makes sense if you

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Speaker 1: think you can snag a re turn that's greater than

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Speaker 1: five point three seven percent. So and you know, the

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Speaker 1: question kind of boils down to whether or not you

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Speaker 1: think that that is likely what you would expect to

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Speaker 1: see from the market with that lump sum, where you

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Speaker 1: to go ahead and invest it.

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Speaker 2: Yeah, and that might sound kind of easy. I mean,

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Speaker 2: if you look in a recent history save these accounts

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Speaker 2: and CDs, they were paying in that neighborhood, right, so

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Speaker 2: you're like, oh, five plus percent, I can get that

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Speaker 2: risk taken. Or you just look at the last two

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Speaker 2: years in the stock market and you're like earning more

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Speaker 2: than five percent. I mean the stock market this year

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Speaker 2: is up like thirty percent, right, So this sounds very doable.

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Speaker 2: But I think you have to not just look at

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Speaker 2: like the most recent history, but also kind of take

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Speaker 2: a larger window in order to make a good decision here.

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Speaker 2: If rates continue to decline, we're talking about having to

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Speaker 2: take on more risk in order to achieve those returns

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Speaker 2: that you need, which means putting a decent bit of

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Speaker 2: that lump sum that you would get into the market.

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Speaker 2: And this will be wise considering how many decades you're

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Speaker 2: trying to fund anyway, right, like four decades of retirement here,

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Speaker 2: But there's still risk when it comes to making that decision.

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Speaker 2: I think it's important also to mention that age is

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Speaker 2: a factor in Trent's decision, right, Like when I'm running

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Speaker 2: the numbers, Matt, I'm forty years old. Trent is almost

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Speaker 2: fifty five, and he's planning on retiring soon. And so

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Speaker 2: we're in kind of two different situations here where Trent

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Speaker 2: can and should be taking some market risk if he

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Speaker 2: takes the lumps, but he might not be able to

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Speaker 2: have as market heavy of an investing focus as I

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Speaker 2: can be, given the extra one and a half decades

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Speaker 2: that I have to endure potential downturns, so.

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Speaker 1: Some swings in the market.

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Speaker 2: Yeah, I think it's just important for Trent to realize, Hey,

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Speaker 2: we're kind of in different scenarios here, and that guaranteed

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Speaker 2: return and the facts on the ground they are they're

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Speaker 2: similar in some ways, but they're also different in others.

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Speaker 1: That's true. Yeah. I'll point out as well though that

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Speaker 1: Trent he did he mentioned he's got over like two

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Speaker 1: million dollars in other accounts. I think he said he's

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Speaker 1: got like over one hundred and fifty thousand dollars in

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Speaker 1: cash that he's looking to uh to spend as well,

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Speaker 1: And so that tells me, I mean, that puts me

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Speaker 1: more in the camp of maybe invest a little bit

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Speaker 1: more aggressively because of the fact that he's going to

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Speaker 1: be able to weather downturns in the market. That's a

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Speaker 1: good point. He's got a little more I don't know,

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Speaker 1: there's a little more slack in the leash. If the

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Speaker 1: market dives to the left, it's like he's got time

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Speaker 1: to basically respond to that and maybe brace a little bit.

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Speaker 2: Yeah, I guess if it's a big dog you're saying,

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Speaker 2: it sounds like based on the way he lives, and

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Speaker 2: I'm based on what he's been able to amass as

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Speaker 2: a nest egg over time, he's got more flexibility than

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Speaker 2: the average person.

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Speaker 1: And so if you're if this was his only source

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Speaker 1: of margin, it would be different. That's right.

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Speaker 2: You almost like are forced to take the guaranteed pension

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Speaker 2: because you don't have that ability to take on additional risk.

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Speaker 1: That's exactly right. And I guess the other factor too.

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Speaker 1: He mentioned some of the different assets that he has,

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Speaker 1: but he did I don't think he shared what his

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Speaker 1: cost of living was, like how much she's looking to

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Speaker 1: spend every single year? And so I don't know, maybe

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Speaker 1: that one hundred and fifty k that could last you

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Speaker 1: or between six months. Actually, I mean it could last

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Speaker 1: you one month depending on your lifestyle, or it could

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Speaker 1: last you like five years. He's popping bottles at the club.

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Speaker 1: We'll see all night every night, bottam of blah. Like

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Speaker 1: you are making an educated guest, right that this is

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Speaker 1: a strategic bet when you make this decision, like you're

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Speaker 1: even making a prediction about how long you're actually going

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Speaker 1: to live and not everything comes down to the numbers.

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Speaker 2: Wait say that again, because I don't think I've ever

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Speaker 2: heard you say that before.

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Speaker 1: So you got to take behavior, You got to take

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Speaker 1: your psychology, what you're willing to endure into account as well.

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Speaker 1: You're taking my point of view, Well, part of the

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Speaker 1: decision does come down to your risk tolerance. You know,

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Speaker 1: how much of a financial buffer have you built up,

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Speaker 1: How flexible do you plan on being with your spending

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Speaker 1: in retirement, Because if your goal, if you simply are

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Speaker 1: only looking at the numbers and your goal is to

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Speaker 1: maximize those dollars, to the absolute fullest. Let's say you've

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Speaker 1: got a high risk appetite will taking the lump sum

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Speaker 1: and investing those dollars in the market. That can make sense.

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Speaker 1: If that were to be the case, you could certainly,

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Speaker 1: I think you can see your network grow more quickly,

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Speaker 1: offering you more optionality. And those numbers too, that that

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Speaker 1: we mentioned that needing to see a five point three

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Speaker 1: seven percent return in the market. That's also assuming that

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Speaker 1: your pension has a cost of living adjustment built into it,

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Speaker 1: and not all pensions do. Most government pensions do, but

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Speaker 1: not all of them do. And so basically, if you

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Speaker 1: don't include that, we run those numbers based on two percent,

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Speaker 1: then you can count on needing to earn less than

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Speaker 1: that two percent, less than five point three to seven percent.

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Speaker 1: So you're looking at three point three seven percent returns

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Speaker 1: from the market in order to earn more than what

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Speaker 1: you would without pension.

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Speaker 2: Yeah, so, Matt, this comes down to whether or not

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Speaker 2: how much risk you feel like you could stomach or

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Speaker 2: if you prefer certainty, and there is a lot of

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Speaker 2: certainty that the monthly pension check provides, right, it would

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Speaker 2: provide a solid benefit for your spouse as well. If

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Speaker 2: you don't make it to ninety five and she does.

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Speaker 2: And if that feels like a security blanket for you two,

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Speaker 2: and I think that's something that needs to be discussed

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Speaker 2: between the two of you. That's understandable that choice can

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Speaker 2: make sense. And if you offer the lump sum right,

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Speaker 2: you've got to be ready to take a massive potential

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Speaker 2: tax hit alongside the risk in the year that you

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Speaker 2: take it right. So if twenty percent is withheld from

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Speaker 2: that lump sum for tax purposes, unless you roll it

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Speaker 2: into an IRA, and that would really be I think

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Speaker 2: the only way that taking the lump sum makes sense

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Speaker 2: is sticking it into an IRA. I mean, otherwise this

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Speaker 2: single year tax bomb would probably be too much to bear, so.

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Speaker 1: It would be massive. So most pension issuers take that

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Speaker 1: twenty percent off to be compliant to the IRS. But

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Speaker 1: it's likely, I mean, assuming you're still earning money from

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Speaker 1: your job, your effective tax rate is going to be

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Speaker 1: more than twenty percent. For much higher than that, I guess,

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Speaker 1: not much higher. Your marginal tax rate is going to

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Speaker 1: be much higher, most likely in the third of the

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Speaker 1: dollar in the lump sum above and beyond what you

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Speaker 1: make in your day job. Will we tax a much

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Speaker 1: higher rate.

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Speaker 2: And so that's why taking the lump sum as a

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Speaker 2: cash payment is like really scary from a tax perspective.

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Speaker 1: There's a whole whole lot of dollars that you're giving

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Speaker 1: to the government all at once. And ultimately, I think

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Speaker 1: this decision boils down to your your primary goal trend.

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Speaker 1: You know, is it to maximize returns and hopes of

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Speaker 1: amassing a bigger nest egg, to increase spending and retirement enjoyment,

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Speaker 1: or even you know, if you wanted to kind of

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Speaker 1: give some of that money away, or is it to

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Speaker 1: minimize the downside risk that you're going to face. I

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Speaker 1: don't think whichever way you choose, I don't think either

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Speaker 1: decision is right or wrong. And of course, since none

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Speaker 1: of us can predict the future and when it comes

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Speaker 1: to market returns or when it comes to our own mortality,

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Speaker 1: I think, you know, we're doing the best we can

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Speaker 1: with information on hand, and I think you're going to

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Speaker 1: make the best decision as well. So Trent, thank you

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Speaker 1: for making my day and allowing me to get nerdy

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Speaker 1: and crunch some numbers. But Joel, we got more to

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Speaker 1: get to. We're gonna talk about annuities. Here for a minute,

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Speaker 1: which is not a typical topic on how to money.

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Speaker 1: We'll get to that more right after this. All right,

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Speaker 1: we're back.

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Speaker 2: We've got more of your questions to get to on

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Speaker 2: this episode. Matt, We've got a question from a listener

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Speaker 2: who is a ridiculously good planner.

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Speaker 1: Hi, Matt and Joel.

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Speaker 4: My name is Sam and I'm from Saint Paul, Minnesota.

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Speaker 4: I found this podcast back during COVID and I love

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Speaker 4: the content and advice you share. My husband and I

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Speaker 4: are planning on buying a house in the next three

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Speaker 4: to four years. We're in our early twenties and right

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Speaker 4: now we love the apartment living, but we know eventually

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Speaker 4: we'll want to settle down. Right now, we are lucky

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Speaker 4: enough to have great jobs we love and very low expenses,

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Speaker 4: so we are able to save half our income each month.

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Speaker 4: Knowing interest rates will likely be falling soon, We're not

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Speaker 4: quite sure where the best place to save our money is.

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Speaker 4: I've been recommended going through my local credit union and

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Speaker 4: doing a CD or money market, but I'm not sure

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Speaker 4: what the pros and cons are to each. Please let

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Speaker 4: me know your thoughts and what you would do in

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Speaker 4: our situation.

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Speaker 1: Sam, I'm so glad you found how to money back?

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Speaker 1: Did she say, back during the pandemic twenty twenty. I

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Speaker 1: feel like those were years that we all needed a

436
00:19:28,600 --> 00:19:30,640
Speaker 1: little bit of additional guidance as to what was going

437
00:19:30,640 --> 00:19:33,320
Speaker 1: on in the world. Gosh, things were changing crazy week.

438
00:19:33,400 --> 00:19:35,840
Speaker 2: That's when the Friday Flight came about, because indeed we

439
00:19:35,880 --> 00:19:38,040
Speaker 2: were like, wait a second, I feel like we need

440
00:19:38,320 --> 00:19:40,199
Speaker 2: a show every single week that's talking about all the

441
00:19:40,200 --> 00:19:41,400
Speaker 2: crazy things that are going on.

442
00:19:41,400 --> 00:19:43,400
Speaker 1: With a lot of moving parts. Yeah, and the world.

443
00:19:43,440 --> 00:19:45,160
Speaker 2: I'm glad we've kept it around, but man, I feel

444
00:19:45,160 --> 00:19:46,960
Speaker 2: like it was like appointment listening.

445
00:19:46,960 --> 00:19:49,320
Speaker 1: Is we felt compelled to create that at that point,

446
00:19:49,320 --> 00:19:53,800
Speaker 1: absolutely totally. Yeah. But Sam, you use the phrase lucky enough,

447
00:19:54,320 --> 00:19:56,280
Speaker 1: and I think that's really important because I think luck

448
00:19:56,359 --> 00:19:59,240
Speaker 1: is a significant factor in all of our lives. But

449
00:19:59,560 --> 00:20:01,679
Speaker 1: you have also so many choices that have set you

450
00:20:01,760 --> 00:20:05,000
Speaker 1: up for success. Not many folks are able to save

451
00:20:05,160 --> 00:20:08,600
Speaker 1: fifty percent of their income. That is a tall order.

452
00:20:08,600 --> 00:20:11,480
Speaker 1: That is a sick That is a very nice savings

453
00:20:11,520 --> 00:20:14,119
Speaker 1: rate right there. And I want to just encourage you

454
00:20:14,119 --> 00:20:18,399
Speaker 1: that the choices that y'all have been making are absolutely working,

455
00:20:18,480 --> 00:20:20,639
Speaker 1: and they're going to make buying a home. You know,

456
00:20:20,680 --> 00:20:22,320
Speaker 1: in your case, three to four years, it's going to

457
00:20:22,400 --> 00:20:23,400
Speaker 1: make that a reality. Yeah.

458
00:20:23,440 --> 00:20:26,440
Speaker 2: I was just talking to one of my buddies, Matt,

459
00:20:26,480 --> 00:20:28,440
Speaker 2: and he was saying he's got a friend who makes

460
00:20:28,760 --> 00:20:32,600
Speaker 2: six hundred thousand dollars a year and is kind of

461
00:20:32,640 --> 00:20:34,879
Speaker 2: consistently living paycheck to paycheck and doing like some of

462
00:20:34,920 --> 00:20:35,439
Speaker 2: these stupid things.

463
00:20:35,520 --> 00:20:35,920
Speaker 1: Oh my gosh.

464
00:20:35,960 --> 00:20:37,639
Speaker 2: And I was thinking, if you put that money in

465
00:20:37,720 --> 00:20:39,240
Speaker 2: my hands and told me I had to spend it,

466
00:20:39,400 --> 00:20:41,040
Speaker 2: I wouldn't know what to do. Like I would, I'd

467
00:20:41,040 --> 00:20:42,760
Speaker 2: be like, how what am I going to spend it on?

468
00:20:43,080 --> 00:20:44,639
Speaker 2: I don't know, Like it would take some work, but

469
00:20:44,680 --> 00:20:47,280
Speaker 2: you would find a way. Maybe my vision feels like

470
00:20:47,520 --> 00:20:49,159
Speaker 2: it doesn't quite exist for that, so I don't know.

471
00:20:49,160 --> 00:20:51,560
Speaker 2: I think Sam yeah needs to give herself some credit

472
00:20:51,600 --> 00:20:53,080
Speaker 2: because there's a lot of people out there who make

473
00:20:53,320 --> 00:20:55,880
Speaker 2: a whole lot more money than she does who are

474
00:20:56,080 --> 00:20:57,880
Speaker 2: spending the bulk of it. Yeah, they're spending it all

475
00:20:57,960 --> 00:21:00,760
Speaker 2: and so you're having a fifty percent saving right is

476
00:21:00,840 --> 00:21:01,520
Speaker 2: nothing to seaz it.

477
00:21:01,680 --> 00:21:02,960
Speaker 1: I think that's a part of it. Like it made

478
00:21:03,000 --> 00:21:04,760
Speaker 1: me think how, like I said, it would take some work,

479
00:21:04,760 --> 00:21:06,400
Speaker 1: and I think that's exactly what it would take because

480
00:21:06,400 --> 00:21:07,879
Speaker 1: you get used to doing the things that you do,

481
00:21:07,920 --> 00:21:09,920
Speaker 1: and so you get like, if you're used to spending money,

482
00:21:10,000 --> 00:21:11,959
Speaker 1: you just get better at spending money, and you just

483
00:21:12,119 --> 00:21:13,680
Speaker 1: as you earn more money, you're like, well, I'm pretty

484
00:21:13,720 --> 00:21:16,480
Speaker 1: good at spending money. Watch this. Yeah, and then they

485
00:21:16,480 --> 00:21:19,280
Speaker 1: go off and buy this. Buy. But like, when it

486
00:21:19,280 --> 00:21:22,879
Speaker 1: comes to being frugal and finding ways to question the

487
00:21:22,920 --> 00:21:25,040
Speaker 1: things that you're spending money on, like, you get better

488
00:21:25,080 --> 00:21:28,040
Speaker 1: and better at that. I think oftentimes you find yourself

489
00:21:28,119 --> 00:21:30,159
Speaker 1: drawn to one or the other. It's almost polarizing. I

490
00:21:30,160 --> 00:21:32,840
Speaker 1: don't know, it's difficult to find somebody who's living in

491
00:21:32,840 --> 00:21:35,679
Speaker 1: a sort of balanced way, or are they able to

492
00:21:35,680 --> 00:21:37,480
Speaker 1: connect some of the sacrifices they're making in the here

493
00:21:37,560 --> 00:21:40,159
Speaker 1: now to some of those in this case, medium term,

494
00:21:40,200 --> 00:21:40,880
Speaker 1: short term goals.

495
00:21:40,920 --> 00:21:43,000
Speaker 2: Yeah, And in this case, you're right, it's like, hey,

496
00:21:43,040 --> 00:21:46,960
Speaker 2: this intentional potentially what might feel like to some excessive

497
00:21:46,960 --> 00:21:50,560
Speaker 2: frugality is leading to this end game that's going to

498
00:21:50,960 --> 00:21:53,919
Speaker 2: be incredible for she and her herth spouse. Right, So

499
00:21:54,359 --> 00:21:55,840
Speaker 2: I love how far they're planning ahead.

500
00:21:55,880 --> 00:21:55,960
Speaker 1: Right.

501
00:21:56,040 --> 00:21:59,040
Speaker 2: They're content with apartment living, but they know that owning

502
00:21:59,119 --> 00:22:01,480
Speaker 2: the home is a medium term goal, and there's just

503
00:22:01,520 --> 00:22:04,080
Speaker 2: way too many folks out there who decide, you know what,

504
00:22:04,480 --> 00:22:06,600
Speaker 2: this year feels like the year for home ownership. I think,

505
00:22:06,640 --> 00:22:08,639
Speaker 2: I think I want to try to buy one in

506
00:22:08,720 --> 00:22:09,480
Speaker 2: twenty twenty four.

507
00:22:10,600 --> 00:22:11,159
Speaker 1: Yeah, exactly.

508
00:22:11,320 --> 00:22:14,200
Speaker 2: Or it's like, you know what, it's November, spring buying season.

509
00:22:14,200 --> 00:22:15,640
Speaker 2: That's what I'm going to jump in on this thing.

510
00:22:16,160 --> 00:22:17,920
Speaker 2: And then they start thinking about how to a massive

511
00:22:17,960 --> 00:22:21,160
Speaker 2: down payment, but they haven't given themselves a long enough timeline.

512
00:22:21,160 --> 00:22:22,159
Speaker 1: They don't have enough runway.

513
00:22:22,440 --> 00:22:24,320
Speaker 2: It means they don't have enough to put down. They

514
00:22:24,320 --> 00:22:27,560
Speaker 2: have to settle for a home that they wouldn't otherwise

515
00:22:27,720 --> 00:22:29,800
Speaker 2: op the purchase, or they take on a mortgage that's

516
00:22:29,840 --> 00:22:32,359
Speaker 2: beyond their means. Right they they're like, Okay, I'm going

517
00:22:32,400 --> 00:22:34,240
Speaker 2: to put three and a half percent down instead of

518
00:22:34,359 --> 00:22:37,679
Speaker 2: ten percent, and so my mortgage is a little out

519
00:22:37,720 --> 00:22:39,600
Speaker 2: of control. And guess what it's even on like this

520
00:22:39,680 --> 00:22:41,440
Speaker 2: starter home that I don't really love and I don't

521
00:22:41,440 --> 00:22:44,040
Speaker 2: plan on being in for very long. I think figuring

522
00:22:44,040 --> 00:22:46,879
Speaker 2: out those goals in advance, well in advance, and then

523
00:22:46,920 --> 00:22:51,000
Speaker 2: saving diligently it makes that endeavor joyful instead of being

524
00:22:51,280 --> 00:22:52,119
Speaker 2: just fraught with peril.

525
00:22:52,200 --> 00:22:54,159
Speaker 1: Totally. Yeah, I think a part of the reason for

526
00:22:54,200 --> 00:22:57,280
Speaker 1: saving so dang much of their income, the reason that

527
00:22:57,320 --> 00:22:59,119
Speaker 1: this is such a big win at this point in

528
00:22:59,119 --> 00:23:01,159
Speaker 1: time is that Sam and her husband can be reaching

529
00:23:01,640 --> 00:23:03,879
Speaker 1: not just a new home, but I think they can

530
00:23:03,880 --> 00:23:06,280
Speaker 1: be reaching multiple goals at once. Yeah, Well, the savings

531
00:23:06,320 --> 00:23:08,480
Speaker 1: rate that large, for sure. I'm guessing that they're investing

532
00:23:08,560 --> 00:23:12,040
Speaker 1: a decent chunk of that massive savings rate while also

533
00:23:12,080 --> 00:23:14,800
Speaker 1: having plenty of money left over to funnel into savings

534
00:23:14,920 --> 00:23:17,520
Speaker 1: for that down payment. And I think if their savings

535
00:23:17,600 --> 00:23:20,840
Speaker 1: rate was just more typical, right like, even if it

536
00:23:20,880 --> 00:23:23,200
Speaker 1: was just like twenty percent instead, I think they would

537
00:23:23,200 --> 00:23:25,760
Speaker 1: they might have to end up scrimping on one goal

538
00:23:25,880 --> 00:23:28,159
Speaker 1: or the other, you know, where they're maybe delaying financial

539
00:23:28,200 --> 00:23:31,720
Speaker 1: independence further down the road, or maybe they're really focused

540
00:23:31,720 --> 00:23:34,920
Speaker 1: on financial independence and said they're gonna forego home ownership.

541
00:23:35,280 --> 00:23:39,720
Speaker 1: Saving fifty percent is it's admirable, and it's not easy.

542
00:23:39,800 --> 00:23:41,400
Speaker 1: It's not easy, and then they may not be able

543
00:23:41,440 --> 00:23:44,360
Speaker 1: to keep it up for you know, for forever. Makes

544
00:23:44,400 --> 00:23:47,280
Speaker 1: me think of our buddy Jordan grummot aka dot G

545
00:23:48,320 --> 00:23:50,679
Speaker 1: that he always talks about frontloading the sacrifice, and that

546
00:23:50,800 --> 00:23:54,320
Speaker 1: is what Sam is doing. And I think certainly in

547
00:23:54,560 --> 00:23:56,200
Speaker 1: three or four years from now, I think they will

548
00:23:56,240 --> 00:23:57,000
Speaker 1: be glad that they did.

549
00:23:57,119 --> 00:23:59,240
Speaker 2: Yeah, it's like holding that pedal to the metal for

550
00:23:59,560 --> 00:24:02,560
Speaker 2: a hand of years early on can mean that you

551
00:24:02,600 --> 00:24:06,240
Speaker 2: can relax your foot significantly, let that Tesla auto drive

552
00:24:06,280 --> 00:24:07,720
Speaker 2: matt take hold or something like that.

553
00:24:07,960 --> 00:24:08,320
Speaker 1: I don't know.

554
00:24:08,359 --> 00:24:10,520
Speaker 2: I've never I've driven to Tesla once, but I've never

555
00:24:10,520 --> 00:24:12,840
Speaker 2: done the auto drive thing. I've been in Tesla's that

556
00:24:13,000 --> 00:24:14,040
Speaker 2: are on auto drives.

557
00:24:14,040 --> 00:24:15,240
Speaker 1: It's scary. It's scary for you.

558
00:24:16,280 --> 00:24:19,840
Speaker 2: That's cool, But I think that is the kind of

559
00:24:19,960 --> 00:24:22,679
Speaker 2: scenario you can expect if you have that significant of

560
00:24:22,680 --> 00:24:24,840
Speaker 2: a savings rate for a decent period of time in

561
00:24:24,840 --> 00:24:27,679
Speaker 2: those early years, is you just have so much more optionality,

562
00:24:27,720 --> 00:24:30,120
Speaker 2: so much more flexibility a few years down the road.

563
00:24:30,160 --> 00:24:34,680
Speaker 2: So onto Sam's specific question, where should she save those dollars?

564
00:24:35,000 --> 00:24:36,680
Speaker 2: I think a CD can make a lot of sense

565
00:24:36,720 --> 00:24:40,000
Speaker 2: right now, a certificate of deposit. And that's particularly true

566
00:24:40,119 --> 00:24:42,880
Speaker 2: I think when it looks like and we don't know

567
00:24:43,040 --> 00:24:45,480
Speaker 2: how much, how far, or how fast, interest rates are

568
00:24:45,520 --> 00:24:48,280
Speaker 2: going to decline, but it does look like they will

569
00:24:48,280 --> 00:24:53,000
Speaker 2: decline more in the coming months or years. If you're

570
00:24:53,000 --> 00:24:55,679
Speaker 2: locking up those funds for twelve to eighteen months. It

571
00:24:55,720 --> 00:24:58,120
Speaker 2: ensures that you're going to continue to receive a higher

572
00:24:58,160 --> 00:25:01,440
Speaker 2: payout right as the high old savings accounts rates go down.

573
00:25:01,480 --> 00:25:03,920
Speaker 2: So right now still pretty solid, but those are likely

574
00:25:03,960 --> 00:25:06,320
Speaker 2: to get worse and worse because right when the FED

575
00:25:06,320 --> 00:25:09,520
Speaker 2: cuts rates, guess what goes down. Not the rate to

576
00:25:09,600 --> 00:25:13,680
Speaker 2: borrow money oftentimes, but the rate on your savings typically

577
00:25:13,680 --> 00:25:17,520
Speaker 2: goes down immediately. And so this is particularly true because

578
00:25:17,560 --> 00:25:20,160
Speaker 2: the liquidity it's not a concern for your dollars right now.

579
00:25:20,160 --> 00:25:22,320
Speaker 2: It's not like you're you're saying, oh, but I might

580
00:25:22,359 --> 00:25:24,119
Speaker 2: need to tap some of those just in case. You

581
00:25:24,160 --> 00:25:26,960
Speaker 2: have a kind of a targeted window of three to

582
00:25:27,040 --> 00:25:27,600
Speaker 2: four years.

583
00:25:28,160 --> 00:25:30,040
Speaker 1: So as a known timeline, Yes.

584
00:25:29,920 --> 00:25:32,679
Speaker 2: I think locking it up should shouldn't cause really any angst.

585
00:25:32,680 --> 00:25:34,640
Speaker 2: And so one of the things I think she mentioned

586
00:25:34,720 --> 00:25:36,960
Speaker 2: was going with her local credit union. Well, that might

587
00:25:37,080 --> 00:25:40,960
Speaker 2: or might not make the most sense, right because rates

588
00:25:41,000 --> 00:25:44,600
Speaker 2: on CDs and savings products can vary wildly. Is your

589
00:25:44,600 --> 00:25:47,199
Speaker 2: credit union competitive in that space? I mean, maybe, but

590
00:25:47,320 --> 00:25:50,560
Speaker 2: maybe not. I think the best place to compare CD

591
00:25:50,680 --> 00:25:53,000
Speaker 2: rates in highlight sav INGUS accounts rates to is a

592
00:25:53,040 --> 00:25:56,480
Speaker 2: site like doctor Offcredit Dot com and we're likely talking

593
00:25:56,480 --> 00:25:58,840
Speaker 2: about here, Matt. When it comes to a lump sum

594
00:25:58,880 --> 00:26:01,600
Speaker 2: down payment, we're talking about a big start chunk of money.

595
00:26:01,880 --> 00:26:04,680
Speaker 2: So the extra half percent or one percent it really

596
00:26:04,760 --> 00:26:07,240
Speaker 2: matters on something like this. Where As we're talking about, Oh,

597
00:26:07,240 --> 00:26:09,040
Speaker 2: I've got three thousand bucks in savings, should I go

598
00:26:09,080 --> 00:26:11,439
Speaker 2: from the four percent of the five percent account? No,

599
00:26:11,520 --> 00:26:13,719
Speaker 2: it's probably not worth jumping through those hoops, but it

600
00:26:13,800 --> 00:26:16,600
Speaker 2: is worth opening up an account at another institution if

601
00:26:16,600 --> 00:26:19,639
Speaker 2: we're talking about a significant bump in interest rate on

602
00:26:19,920 --> 00:26:21,600
Speaker 2: a big chunk of money that they're holding onto.

603
00:26:21,840 --> 00:26:24,719
Speaker 1: Yeah, and specific to their timeline. I did a quick google,

604
00:26:24,880 --> 00:26:27,840
Speaker 1: and depending on how quick you are to get out

605
00:26:27,880 --> 00:26:29,560
Speaker 1: there and get searched, but I saw a three year

606
00:26:30,080 --> 00:26:33,480
Speaker 1: CD at a credit union up in Michigan that all

607
00:26:33,480 --> 00:26:35,360
Speaker 1: it takes is a fight dollar donation to like some

608
00:26:35,400 --> 00:26:38,159
Speaker 1: sort of local charity, and boom, you have access to

609
00:26:38,400 --> 00:26:42,680
Speaker 1: this three year, four point three five percent certificate of deposit,

610
00:26:42,720 --> 00:26:45,720
Speaker 1: which might be like totally perfect for the year them

611
00:26:45,840 --> 00:26:47,879
Speaker 1: a three year window. But on top of that, I mean,

612
00:26:47,880 --> 00:26:49,439
Speaker 1: I think chances are that she's going to have new

613
00:26:49,440 --> 00:26:52,000
Speaker 1: savings flowing in every month, and so I think she

614
00:26:52,080 --> 00:26:54,240
Speaker 1: could open up a CD with the bulk of her

615
00:26:54,280 --> 00:26:58,400
Speaker 1: current savings pile, but then funnel additional incoming dollars into

616
00:26:58,480 --> 00:27:00,920
Speaker 1: just like a basic Hygilts savings account or even a

617
00:27:00,960 --> 00:27:03,479
Speaker 1: money market account, the best of which are still at

618
00:27:03,480 --> 00:27:05,639
Speaker 1: this point at least paying north of like four and

619
00:27:05,680 --> 00:27:09,280
Speaker 1: a quarter c It's platinum savings account. It has been

620
00:27:09,359 --> 00:27:12,639
Speaker 1: an upper echelon account four years now, and we need

621
00:27:12,760 --> 00:27:14,840
Speaker 1: to kind of go this approach, like you are protecting

622
00:27:14,840 --> 00:27:17,399
Speaker 1: the bulk of your dollars from declining interest rates, and

623
00:27:17,440 --> 00:27:20,280
Speaker 1: then you're getting the best current rates for these new

624
00:27:20,320 --> 00:27:24,119
Speaker 1: savings dollars that you don't have on hand. The only

625
00:27:24,320 --> 00:27:27,160
Speaker 1: other reason I would sort of question this is one

626
00:27:27,200 --> 00:27:29,359
Speaker 1: other thing that you mentioned was that you love and

627
00:27:29,400 --> 00:27:31,000
Speaker 1: this is this stood out to me because not many

628
00:27:31,000 --> 00:27:34,479
Speaker 1: people love living in an apartment, but you said that.

629
00:27:34,600 --> 00:27:37,719
Speaker 1: You said that we love apartment living right now, and

630
00:27:37,760 --> 00:27:40,560
Speaker 1: so I would ask you how flexible are you when

631
00:27:40,560 --> 00:27:42,200
Speaker 1: it comes to buying a home in three to four years,

632
00:27:42,200 --> 00:27:44,560
Speaker 1: because if you have a little bit of flexibility when

633
00:27:44,560 --> 00:27:47,000
Speaker 1: it comes to your timeline, man, I would be so

634
00:27:47,119 --> 00:27:49,879
Speaker 1: tempted to invest those dollars as a like straight up

635
00:27:49,920 --> 00:27:51,960
Speaker 1: in the market. So I have some numbers to illustrate it, Joel,

636
00:27:51,960 --> 00:27:53,840
Speaker 1: I'm gonna crunch them numbers again. Do it mean it's

637
00:27:53,840 --> 00:27:56,000
Speaker 1: gonna say, yeah, three year window, it's too risky. But

638
00:27:56,040 --> 00:27:57,960
Speaker 1: if you can bump bump that window out to five

639
00:27:58,000 --> 00:28:00,440
Speaker 1: or six years, investing might make the most sense. Yeah,

640
00:28:00,600 --> 00:28:02,960
Speaker 1: like even four to five years. Because so the media,

641
00:28:03,000 --> 00:28:06,080
Speaker 1: according to FED, the median home today is four hundred

642
00:28:06,080 --> 00:28:07,920
Speaker 1: and twenty thousand dollars. So you're looking at a down

643
00:28:07,920 --> 00:28:10,480
Speaker 1: payment of eighty four thousand dollars. And let's just say,

644
00:28:10,480 --> 00:28:12,760
Speaker 1: because they've been saving fifty percent of their income right now,

645
00:28:13,240 --> 00:28:16,040
Speaker 1: they might already have that cash in the bank. And

646
00:28:16,119 --> 00:28:17,480
Speaker 1: so if you were to just stick that into a

647
00:28:17,520 --> 00:28:19,439
Speaker 1: highyield savings where you're earning let's say four and a

648
00:28:19,480 --> 00:28:21,679
Speaker 1: quarter percent, well, that eighty four k is going to

649
00:28:21,720 --> 00:28:25,840
Speaker 1: grow to one hundred thousand dollars in four years. That's solid. Yeah,

650
00:28:25,880 --> 00:28:27,600
Speaker 1: like that's really nice. But before you to invest that

651
00:28:27,640 --> 00:28:30,520
Speaker 1: in the market, in historically speaking, you're looking at ten

652
00:28:30,600 --> 00:28:32,600
Speaker 1: percent in the market. You're not just looking at one

653
00:28:32,680 --> 00:28:34,879
Speaker 1: hundred thousand dollars in four years, you're looking at one

654
00:28:34,960 --> 00:28:38,120
Speaker 1: hundred and twenty three thousand dollars. A lot more buying power. Yeah,

655
00:28:38,320 --> 00:28:39,120
Speaker 1: like that's a chick.

656
00:28:39,440 --> 00:28:41,920
Speaker 2: Whether it means you can afford maybe slightly more house

657
00:28:41,920 --> 00:28:44,880
Speaker 2: than you thought, or you can reduce that mortgage payments

658
00:28:44,880 --> 00:28:48,080
Speaker 2: significantly gain more favorable terms, like I would be so tempted,

659
00:28:48,200 --> 00:28:51,600
Speaker 2: especially again given the fact that you're it sounds like

660
00:28:51,640 --> 00:28:52,760
Speaker 2: you're all about apartment living.

661
00:28:52,800 --> 00:28:55,160
Speaker 1: You know, you're like, don't thread me with a good

662
00:28:55,160 --> 00:28:56,719
Speaker 1: time living in an apartment where I don't have to keep

663
00:28:56,760 --> 00:28:59,800
Speaker 1: up with any maintenance. And so for you, just in

664
00:28:59,840 --> 00:29:03,080
Speaker 1: your specific case, Sam, I wonder if you know, were

665
00:29:03,120 --> 00:29:05,280
Speaker 1: you two experienced declients in the market for y'all to say,

666
00:29:05,320 --> 00:29:07,800
Speaker 1: all right, we'll just keep hanging out here, it's a blast.

667
00:29:07,880 --> 00:29:09,760
Speaker 1: Just punt the home ownership timeline a little bit longer

668
00:29:09,800 --> 00:29:11,640
Speaker 1: down the road, a year or two, and wait for

669
00:29:11,680 --> 00:29:13,720
Speaker 1: the market to return. I think the two things risk

670
00:29:13,800 --> 00:29:16,800
Speaker 1: tolerance and timeline. So ye, how are you feeling about

671
00:29:16,800 --> 00:29:19,280
Speaker 1: those things? And if you do have that flexibility to punt,

672
00:29:19,600 --> 00:29:22,640
Speaker 1: then I think Matt, your suggestion is a good one.

673
00:29:22,760 --> 00:29:25,320
Speaker 1: I think if you're like, we we love it now,

674
00:29:25,400 --> 00:29:27,320
Speaker 1: but three years from now, we know, we know that

675
00:29:27,360 --> 00:29:28,440
Speaker 1: we're going to win a house, We're.

676
00:29:28,280 --> 00:29:30,040
Speaker 2: Gonna have triplets and I don't know how you would

677
00:29:30,040 --> 00:29:31,560
Speaker 2: know that ahead of time. But if you know that

678
00:29:31,600 --> 00:29:35,560
Speaker 2: and you're like home ownership somehow, if you necessity you're clairvoyant,

679
00:29:35,800 --> 00:29:37,560
Speaker 2: please give me a call. I have other questions for you.

680
00:29:37,600 --> 00:29:39,240
Speaker 2: But that's the kind of that's the kind of thing

681
00:29:39,240 --> 00:29:41,400
Speaker 2: where if you know that's coming down the pike, then

682
00:29:41,600 --> 00:29:44,000
Speaker 2: you're like, well, home ownership is non negotiable in three years,

683
00:29:44,200 --> 00:29:47,000
Speaker 2: then investing is I think too risky. But if you've

684
00:29:47,000 --> 00:29:49,320
Speaker 2: got that flexibility and you can change the timeline, then

685
00:29:49,400 --> 00:29:50,960
Speaker 2: investing makes a good bit of sense.

686
00:29:51,040 --> 00:29:53,160
Speaker 1: Joel, let's get to our next question. This is a

687
00:29:53,240 --> 00:29:56,040
Speaker 1: question that has to do with a pretty sizable inheritance.

688
00:29:57,120 --> 00:29:59,040
Speaker 5: Hey, Matt and Joel, this is justin from Iowa.

689
00:29:59,240 --> 00:29:59,800
Speaker 1: Go Hawks.

690
00:30:00,440 --> 00:30:02,840
Speaker 5: Really appreciate the podcast, and I've learned a lot from

691
00:30:02,840 --> 00:30:05,760
Speaker 5: you guys, so thanks for doing the good work. I

692
00:30:05,800 --> 00:30:08,800
Speaker 5: got a two part question for you this week. I

693
00:30:08,840 --> 00:30:12,680
Speaker 5: have a relative who recently inherited a large sum of

694
00:30:12,720 --> 00:30:14,800
Speaker 5: money and asked me for advice on what to do

695
00:30:14,880 --> 00:30:18,640
Speaker 5: with it. She just turned sixty, so putting it in

696
00:30:19,200 --> 00:30:22,560
Speaker 5: IRA does not make much sense, so I suggested a

697
00:30:22,560 --> 00:30:26,720
Speaker 5: brokerage account. She didn't like that idea because she didn't

698
00:30:26,760 --> 00:30:30,360
Speaker 5: want to risk losing any of her money. She just

699
00:30:30,400 --> 00:30:34,680
Speaker 5: wants a safe place to put it until she can

700
00:30:34,720 --> 00:30:37,040
Speaker 5: figure out what to do with it long term. She

701
00:30:37,280 --> 00:30:41,520
Speaker 5: was thinking of buying it an annuity. I know from

702
00:30:41,600 --> 00:30:45,320
Speaker 5: past episodes you guys are not the biggest fans of annuities.

703
00:30:45,400 --> 00:30:49,560
Speaker 5: So here's my two part question. One, what are the

704
00:30:49,880 --> 00:30:52,520
Speaker 5: details of an annuity and what is it specifically that

705
00:30:52,560 --> 00:30:55,960
Speaker 5: you don't really like about them? And two, what would

706
00:30:56,000 --> 00:30:58,400
Speaker 5: be your advice to this family member of mine on

707
00:30:58,480 --> 00:31:01,120
Speaker 5: where she could put it to limporarily that would give

708
00:31:01,120 --> 00:31:04,520
Speaker 5: her some return and not risk losing any of it

709
00:31:04,680 --> 00:31:06,840
Speaker 5: until she figures out what she wants to do with it.

710
00:31:07,720 --> 00:31:11,120
Speaker 5: Thanks appreciate the show. You guys are awesome. Keep up

711
00:31:11,160 --> 00:31:11,760
Speaker 5: the good work.

712
00:31:12,040 --> 00:31:13,440
Speaker 1: Ooh man love.

713
00:31:13,680 --> 00:31:16,479
Speaker 2: I love waiting in a financial drama between family members.

714
00:31:16,640 --> 00:31:18,880
Speaker 2: It's my favorite thing. Put me in the middle. I'll

715
00:31:18,920 --> 00:31:21,320
Speaker 2: referee this thing. It's not like I'll get everyone on.

716
00:31:21,280 --> 00:31:24,000
Speaker 1: The same page. Justin was loaning money to a cousin

717
00:31:24,080 --> 00:31:26,320
Speaker 1: and now that cousin is refusing to pay it back,

718
00:31:26,320 --> 00:31:28,920
Speaker 1: and they've just you know, they're looking ahead to Thanksgiving

719
00:31:28,960 --> 00:31:31,000
Speaker 1: and they're like, oh, this is gonna be so awkward. Yeah,

720
00:31:31,160 --> 00:31:34,560
Speaker 1: that would actually be more fun to wait into. Hey,

721
00:31:34,600 --> 00:31:37,680
Speaker 1: let me solve that problem. Please. Thanksgiving brings out the

722
00:31:37,720 --> 00:31:39,560
Speaker 1: best in all of us, in all of our families,

723
00:31:39,560 --> 00:31:42,280
Speaker 1: doesn't it. Yeah a lot. Thanksgiving. It so depends on

724
00:31:42,320 --> 00:31:45,080
Speaker 1: what your family's like. Now I love I man, what

725
00:31:45,120 --> 00:31:47,440
Speaker 1: about Thanksgiving after presidential election?

726
00:31:47,600 --> 00:31:50,160
Speaker 2: Oh gosh, yeah, it depends. I mean, it depends on

727
00:31:50,200 --> 00:31:53,600
Speaker 2: what your family's like. And if y'all are reasonable and

728
00:31:53,600 --> 00:31:55,960
Speaker 2: you put your relationship ahead of your politics, which I

729
00:31:55,960 --> 00:31:56,480
Speaker 2: hope that's.

730
00:31:56,320 --> 00:31:57,760
Speaker 1: True for everyone out there. I agree.

731
00:31:57,760 --> 00:32:00,560
Speaker 2: All right, First things, First, timeline. I feel like this

732
00:32:00,600 --> 00:32:02,600
Speaker 2: is something that kind of keeps coming up. A timeline

733
00:32:02,600 --> 00:32:05,440
Speaker 2: and risk tolerance or this is the investing ask how

734
00:32:05,480 --> 00:32:07,800
Speaker 2: to Money episode? Which is there anything more fun to

735
00:32:07,840 --> 00:32:09,280
Speaker 2: do than invest a bunch of money?

736
00:32:09,280 --> 00:32:10,840
Speaker 1: It was pretty fun. I guess you could spend it

737
00:32:10,880 --> 00:32:13,160
Speaker 1: if you're like the friend that was making six thousand dollars.

738
00:32:13,280 --> 00:32:16,200
Speaker 1: But for them, maybe investing isn't much fun. But for

739
00:32:16,240 --> 00:32:17,560
Speaker 1: the rest of us who are looking to grow our

740
00:32:17,600 --> 00:32:19,000
Speaker 1: networth over the long term, that's right.

741
00:32:19,280 --> 00:32:22,960
Speaker 2: And investing the two things when you're always thinking about, well,

742
00:32:23,200 --> 00:32:24,959
Speaker 2: what sort of risk can I take and what do

743
00:32:25,040 --> 00:32:30,400
Speaker 2: I want to see from my money in terms of returns, Well,

744
00:32:30,880 --> 00:32:32,920
Speaker 2: how much time do you have and how much risk

745
00:32:32,960 --> 00:32:34,800
Speaker 2: do you feel like you're able to bear? Those are

746
00:32:34,800 --> 00:32:37,760
Speaker 2: really factors for what you choose to do with the

747
00:32:37,760 --> 00:32:40,800
Speaker 2: money in your possession. And it sounds like justin your

748
00:32:41,000 --> 00:32:44,400
Speaker 2: your relative here is fairly risk averse. But I think

749
00:32:44,840 --> 00:32:48,720
Speaker 2: if the conversation pathway is open, I would want to

750
00:32:48,760 --> 00:32:52,120
Speaker 2: talk to her about the risks of not taking much risk.

751
00:32:52,240 --> 00:32:55,000
Speaker 2: Oh and you know in inflation, right, this is the

752
00:32:55,040 --> 00:32:58,480
Speaker 2: perfect actually time to talk about inflation with somebody else.

753
00:32:58,760 --> 00:33:01,120
Speaker 2: It has always been in all will be kind of

754
00:33:01,120 --> 00:33:04,000
Speaker 2: the silent killer when it comes to money that's not invested.

755
00:33:04,120 --> 00:33:06,920
Speaker 1: It's like carbon monoxide. Yeah, it's like this slow thing

756
00:33:06,920 --> 00:33:09,360
Speaker 1: and can't see it, can't smell it, but it'll mess

757
00:33:09,400 --> 00:33:09,640
Speaker 1: you up.

758
00:33:09,640 --> 00:33:11,160
Speaker 2: If you're in a garage with the car running, it

759
00:33:11,200 --> 00:33:13,280
Speaker 2: will mess you up. And so, given what we've all

760
00:33:13,320 --> 00:33:16,240
Speaker 2: experienced over the past four years or so, though everyone

761
00:33:16,400 --> 00:33:19,160
Speaker 2: viscerally understands the reality of inflation, so it's not like

762
00:33:19,200 --> 00:33:21,600
Speaker 2: you have to even explain it all too much. It's

763
00:33:21,600 --> 00:33:24,680
Speaker 2: like it's true bacon and eggs or insurance costs, whatever

764
00:33:24,680 --> 00:33:27,720
Speaker 2: it is, whatever you want to point to your relative

765
00:33:27,760 --> 00:33:30,080
Speaker 2: is going to understand the impact that inflation has had

766
00:33:30,120 --> 00:33:33,520
Speaker 2: on her life. The trouble is people don't always know

767
00:33:33,560 --> 00:33:37,880
Speaker 2: how to counteract the negative influence of inflation, how to

768
00:33:38,240 --> 00:33:40,800
Speaker 2: kind of beat what inflation is trying to do your money,

769
00:33:40,800 --> 00:33:43,160
Speaker 2: which is to make it worth less over time, and

770
00:33:43,440 --> 00:33:45,640
Speaker 2: you know, saving that money, Yeah, you might be able

771
00:33:45,640 --> 00:33:48,920
Speaker 2: to eke out a return that's slightly higher than the

772
00:33:48,960 --> 00:33:51,800
Speaker 2: pace of inflation, but we also don't know how long

773
00:33:51,840 --> 00:33:55,640
Speaker 2: that's going to last, with rates going down and the

774
00:33:55,760 --> 00:33:58,640
Speaker 2: rate of inflation not seeming to want to go beneath

775
00:33:58,640 --> 00:34:01,680
Speaker 2: that two and a half percent mark. Matt, So, I

776
00:34:01,760 --> 00:34:03,840
Speaker 2: think now is as good a time as any to

777
00:34:03,920 --> 00:34:06,720
Speaker 2: kind of have that conversation around inflation and what needs

778
00:34:06,720 --> 00:34:10,399
Speaker 2: to be done in order to ensure that being too

779
00:34:10,520 --> 00:34:12,920
Speaker 2: risk sensitive is actually one of the riskiest things you

780
00:34:12,920 --> 00:34:14,000
Speaker 2: can be as well, totally.

781
00:34:14,160 --> 00:34:17,440
Speaker 1: Yeah. Risk Folks tend to want to avoid it, and

782
00:34:17,480 --> 00:34:20,920
Speaker 1: people often think of the stock market as being potentially risky,

783
00:34:21,200 --> 00:34:25,040
Speaker 1: But dude, inflation is a known risk and the proble

784
00:34:25,080 --> 00:34:27,239
Speaker 1: one we undervalue most of the yeah. Yeah, and it's

785
00:34:27,280 --> 00:34:29,320
Speaker 1: you know, the price we pay for attempting to eliminate

786
00:34:29,400 --> 00:34:32,600
Speaker 1: risk and gain more certainty that typically causes us to

787
00:34:32,640 --> 00:34:36,000
Speaker 1: miss out on upsides. So what is it that your

788
00:34:36,160 --> 00:34:39,200
Speaker 1: family member, that your relative here justin should do well

789
00:34:39,200 --> 00:34:41,919
Speaker 1: the tax advantaged account? I think that actually could make sense.

790
00:34:41,960 --> 00:34:45,360
Speaker 1: You mentioned how she's sixty, and maybe that that is

791
00:34:45,360 --> 00:34:48,239
Speaker 1: something that doesn't make sense. It has less to do

792
00:34:48,320 --> 00:34:50,120
Speaker 1: with her age, and I think it has more to

793
00:34:50,160 --> 00:34:52,319
Speaker 1: do with what it is she's actually going to invest in.

794
00:34:52,400 --> 00:34:54,600
Speaker 2: Yeah, the investment choices inside of that account.

795
00:34:54,280 --> 00:34:56,920
Speaker 1: They Matt, Yeah, Like there's no age limit on contributing

796
00:34:56,960 --> 00:34:59,520
Speaker 1: to an IRA. I guess she just needs to make

797
00:34:59,560 --> 00:35:02,759
Speaker 1: sure that she has and earned income. But the investments

798
00:35:02,800 --> 00:35:04,759
Speaker 1: that go inside of that I rate she doesn't have

799
00:35:04,800 --> 00:35:07,960
Speaker 1: to go all in on like a one hundred percent

800
00:35:08,000 --> 00:35:11,239
Speaker 1: basket of stocks depending on a few other factors like

801
00:35:11,280 --> 00:35:15,080
Speaker 1: that would it probably be an unwise investment at age sixty.

802
00:35:15,400 --> 00:35:18,160
Speaker 1: But I'm thinking about like a target date fund that

803
00:35:18,280 --> 00:35:20,560
Speaker 1: could offer the best of both worlds, where it's going

804
00:35:20,640 --> 00:35:25,040
Speaker 1: to give her some needed market exposure aka risk, while

805
00:35:25,080 --> 00:35:27,840
Speaker 1: not being invested in a way that's going to generate

806
00:35:28,040 --> 00:35:30,480
Speaker 1: over the top amount of risk for her specific Yeah.

807
00:35:30,280 --> 00:35:32,640
Speaker 2: Because like when you're sixty, you you don't want to

808
00:35:32,680 --> 00:35:34,960
Speaker 2: be like, let me go one hundred percent on in

809
00:35:35,080 --> 00:35:37,320
Speaker 2: video because it's been rock and let's see what happens.

810
00:35:37,400 --> 00:35:41,239
Speaker 2: Maybe they go from a three point whatever trillion dollar

811
00:35:41,280 --> 00:35:44,000
Speaker 2: company to a six trillion dollar company and now I'm

812
00:35:44,000 --> 00:35:46,880
Speaker 2: sept for life. Like that, that would be too risky

813
00:35:46,920 --> 00:35:49,160
Speaker 2: at that age, and honestly, it's probably too risky at

814
00:35:49,160 --> 00:35:52,120
Speaker 2: any age for anyone to participate in. But trying to

815
00:35:52,160 --> 00:35:55,719
Speaker 2: avoid investing risk completely just put your relative in the

816
00:35:55,760 --> 00:35:58,880
Speaker 2: position of running out of money, which is another risky

817
00:35:58,920 --> 00:36:01,160
Speaker 2: scenario we like her to avoid. And it sounds like

818
00:36:01,560 --> 00:36:04,840
Speaker 2: for some reason she's keen on annuities. I would be curious.

819
00:36:04,880 --> 00:36:07,240
Speaker 2: This is a place where I would ask questions. Also,

820
00:36:08,080 --> 00:36:10,600
Speaker 2: why is that? Like what made her think that annuities

821
00:36:10,880 --> 00:36:14,000
Speaker 2: were the right solution to this problem? And justin I

822
00:36:14,040 --> 00:36:16,840
Speaker 2: would ask this specifically, has she talked to a financial

823
00:36:16,880 --> 00:36:21,000
Speaker 2: advisor who sells annuities right, because if so, it's important

824
00:36:21,000 --> 00:36:24,560
Speaker 2: for her to know that advisor stands to benefit with

825
00:36:25,160 --> 00:36:29,319
Speaker 2: a big commission check right at their route. Annuities are

826
00:36:29,400 --> 00:36:31,560
Speaker 2: an attempt to take a sum of cash and to

827
00:36:31,600 --> 00:36:34,480
Speaker 2: turn it into a recurring monthly check. And that's not

828
00:36:34,520 --> 00:36:37,440
Speaker 2: necessarily a bad thing. The problem is that annuities come

829
00:36:37,440 --> 00:36:39,879
Speaker 2: in a whole bunch of different flavors, some of them

830
00:36:39,880 --> 00:36:42,600
Speaker 2: more expensive than others and some of them more or

831
00:36:42,719 --> 00:36:45,560
Speaker 2: less bad than others. They exist kind of on a spectrum,

832
00:36:45,719 --> 00:36:50,160
Speaker 2: but the vast majority are complicated. They're expensive. The beastly

833
00:36:50,160 --> 00:36:52,600
Speaker 2: commission is only one part of the cost. Over the

834
00:36:52,600 --> 00:36:55,880
Speaker 2: top surrender charges. Let's say, that's another horrifying feature that

835
00:36:55,920 --> 00:36:58,759
Speaker 2: many annuities come with. And so if annuities didn't cost

836
00:36:58,800 --> 00:37:01,560
Speaker 2: an arm and a leg, probably wouldn't dislike them so

837
00:37:01,640 --> 00:37:05,839
Speaker 2: much because they can give people predictable income over an

838
00:37:05,840 --> 00:37:08,120
Speaker 2: extended period of time if they have a lump sum

839
00:37:08,160 --> 00:37:12,560
Speaker 2: and they don't have excess flexibility in their lives like

840
00:37:12,800 --> 00:37:15,800
Speaker 2: they need that known quantity of a predictable monthly payment.

841
00:37:16,000 --> 00:37:18,040
Speaker 2: An annuity can make sense, But just so many of

842
00:37:18,080 --> 00:37:22,279
Speaker 2: them are wrought with high fees, high commissions, and gotcha's

843
00:37:22,440 --> 00:37:24,800
Speaker 2: on the back end. That's what scares me about people

844
00:37:24,800 --> 00:37:26,799
Speaker 2: going with annuities, especially if they don't know what they're

845
00:37:26,800 --> 00:37:27,680
Speaker 2: doing totally.

846
00:37:27,760 --> 00:37:30,000
Speaker 1: Yeah, I mean you mentioned the surrender charges. It sounds

847
00:37:30,040 --> 00:37:32,319
Speaker 1: like she is going to want to do something with

848
00:37:32,360 --> 00:37:34,120
Speaker 1: his money. She just doesn't know what she wants to do.

849
00:37:34,160 --> 00:37:36,360
Speaker 1: With it yet and man to pay out the nose

850
00:37:36,440 --> 00:37:38,719
Speaker 1: to get that money back out of that annuity would

851
00:37:38,760 --> 00:37:41,520
Speaker 1: be a situation I would not want to find myself in.

852
00:37:41,560 --> 00:37:43,640
Speaker 1: But when it comes to some of the different advisors

853
00:37:44,200 --> 00:37:46,600
Speaker 1: out there who are selling annuities, well, there are some

854
00:37:46,680 --> 00:37:50,520
Speaker 1: products that are far more favorable to the end purchaser.

855
00:37:50,560 --> 00:37:53,319
Speaker 1: There are some different commission free annuities. But the other

856
00:37:53,360 --> 00:37:56,480
Speaker 1: problem is investors often don't understand how the annuity they

857
00:37:56,480 --> 00:38:00,040
Speaker 1: are buying works. This is according to JD. Power, that

858
00:38:00,040 --> 00:38:03,239
Speaker 1: it's obviously not good. People are really complicated products often

859
00:38:03,280 --> 00:38:05,640
Speaker 1: because they're sold right. They're sold to them, they're talked

860
00:38:05,719 --> 00:38:08,400
Speaker 1: up to them, and they're saying, well, you have a

861
00:38:08,480 --> 00:38:10,640
Speaker 1: nice suit on. You sound like you know what you're doing.

862
00:38:10,920 --> 00:38:12,600
Speaker 1: I guess I should trust you. I'm going to buy

863
00:38:12,600 --> 00:38:16,040
Speaker 1: the annuity you're telling me about. But when it comes

864
00:38:16,040 --> 00:38:18,160
Speaker 1: down to it, most people don't understand how they work

865
00:38:18,200 --> 00:38:20,560
Speaker 1: and what they're sticking their money in exactly. And again

866
00:38:20,600 --> 00:38:22,360
Speaker 1: it sounds like she might want to do something with

867
00:38:22,400 --> 00:38:24,439
Speaker 1: his money, she just doesn't know exactly what she wants

868
00:38:24,480 --> 00:38:26,719
Speaker 1: to do with it yet, and getting it tied up

869
00:38:26,760 --> 00:38:29,799
Speaker 1: into an annuity sounds like a knot that would be

870
00:38:29,800 --> 00:38:33,239
Speaker 1: difficult to untie. But the only annuities that we are

871
00:38:33,520 --> 00:38:38,239
Speaker 1: a little more sympathetic towards are immediate annuities, and your

872
00:38:38,320 --> 00:38:41,080
Speaker 1: relative might be a good candidate for that because she

873
00:38:41,120 --> 00:38:43,880
Speaker 1: would be turning that lump sum into a dependable monthly

874
00:38:43,960 --> 00:38:47,200
Speaker 1: check at a lower cost. And you can get these

875
00:38:47,200 --> 00:38:49,840
Speaker 1: from lower cost brokerages out there like Fidelity instead of

876
00:38:49,840 --> 00:38:52,320
Speaker 1: going through an actual insurance salesperson. That's one of the

877
00:38:52,320 --> 00:38:55,319
Speaker 1: biggest differences. It's just it's almost like a completely different

878
00:38:55,360 --> 00:38:58,279
Speaker 1: product because of the fact that this isn't something that

879
00:38:58,320 --> 00:39:01,040
Speaker 1: has favorable terms for whoever it is that is looking

880
00:39:01,040 --> 00:39:02,680
Speaker 1: to sell it and to make a profit off.

881
00:39:02,520 --> 00:39:05,759
Speaker 2: Of it, and it's kind of buried on the websites

882
00:39:05,800 --> 00:39:09,400
Speaker 2: of decent financial institutions like Fidelity. Because Fidelity is so

883
00:39:09,440 --> 00:39:12,239
Speaker 2: good at doing so many other things, annuities typically are

884
00:39:12,280 --> 00:39:14,880
Speaker 2: on the way back burner for them, and that's why

885
00:39:15,360 --> 00:39:17,719
Speaker 2: most of the time, the only ways people encounter annuities

886
00:39:18,040 --> 00:39:20,840
Speaker 2: is from these high commission it's her and salespeople, and

887
00:39:20,880 --> 00:39:22,920
Speaker 2: there's a reason they're selling it because that's what puts

888
00:39:23,000 --> 00:39:25,720
Speaker 2: food on the table for their families. But typically it's

889
00:39:25,800 --> 00:39:27,719
Speaker 2: at a disadvantage for you when it comes to the

890
00:39:27,719 --> 00:39:31,200
Speaker 2: financial terms involved in that annuity, which is why most

891
00:39:31,239 --> 00:39:31,680
Speaker 2: of them suck.

892
00:39:31,760 --> 00:39:34,399
Speaker 1: Yeah, And something else that he said is the fact

893
00:39:34,640 --> 00:39:37,040
Speaker 1: that she is looking for a temporary spot, which tells

894
00:39:37,040 --> 00:39:39,920
Speaker 1: me that she doesn't She doesn't sound like she's needing

895
00:39:39,920 --> 00:39:42,600
Speaker 1: this money to live off of. Basically she's trying to like,

896
00:39:42,640 --> 00:39:44,239
Speaker 1: if you need this money to live off of, you're

897
00:39:44,280 --> 00:39:45,960
Speaker 1: not trying to figure out what to do with this

898
00:39:46,040 --> 00:39:48,160
Speaker 1: money like you are, like, Oh, I need to start

899
00:39:48,239 --> 00:39:49,880
Speaker 1: drawing down on that to pay the bills to be

900
00:39:49,920 --> 00:39:51,480
Speaker 1: able to cover the groceries.

901
00:39:51,600 --> 00:39:53,279
Speaker 2: The fact that she and if that's the case and

902
00:39:53,360 --> 00:39:55,879
Speaker 2: you wanted to alast one of those immediate annuities might

903
00:39:55,880 --> 00:39:56,520
Speaker 2: make sense.

904
00:39:56,400 --> 00:39:57,960
Speaker 1: Or even just investing it, because if you don't need

905
00:39:58,000 --> 00:39:59,320
Speaker 1: the money at all, like I feel like this is

906
00:39:59,360 --> 00:40:01,719
Speaker 1: another where man just sticking it in the market, it

907
00:40:01,719 --> 00:40:05,320
Speaker 1: could make a ton of sense, even though she's reticent

908
00:40:05,520 --> 00:40:07,920
Speaker 1: to expose that money to the overl stock market.

909
00:40:08,120 --> 00:40:09,919
Speaker 2: So I guess what I would do is I would

910
00:40:09,920 --> 00:40:12,520
Speaker 2: ask where did that idea come from? Like who placed that?

911
00:40:13,280 --> 00:40:17,000
Speaker 2: Who incepted that idea in your brain? And so why

912
00:40:17,040 --> 00:40:18,680
Speaker 2: do you think that's the best way to go and

913
00:40:18,760 --> 00:40:22,920
Speaker 2: talk about the downside risks of inflation and how important

914
00:40:22,920 --> 00:40:26,320
Speaker 2: it is to combat that, and how taking at least

915
00:40:26,360 --> 00:40:29,239
Speaker 2: some risk, measured risk, makes the most sense to be

916
00:40:29,239 --> 00:40:31,040
Speaker 2: able to extend those dollars, make them work for her

917
00:40:31,080 --> 00:40:33,399
Speaker 2: for an extended period of time. Locking them up into

918
00:40:33,760 --> 00:40:37,480
Speaker 2: an expensive annuity probably isn't the best decision A low

919
00:40:37,480 --> 00:40:41,719
Speaker 2: cost annuity maybe, depending on her circumstances. But hopefully you

920
00:40:41,760 --> 00:40:44,880
Speaker 2: got some good thought starters for that conversation, and hopefully

921
00:40:44,920 --> 00:40:47,120
Speaker 2: you can help her ask some of those important questions

922
00:40:47,360 --> 00:40:49,680
Speaker 2: to drill down and find the right decision for her. Matt,

923
00:40:49,680 --> 00:40:51,840
Speaker 2: We've got more to get to on this episode, and

924
00:40:51,880 --> 00:40:54,200
Speaker 2: we got any in testing one. One question we got

925
00:40:54,200 --> 00:40:56,160
Speaker 2: to get to. We'll hit that up right after this.

926
00:41:04,040 --> 00:41:08,719
Speaker 1: Let's continue with our investing focused episode today. Of course,

927
00:41:08,760 --> 00:41:11,120
Speaker 1: now we've got to get to our Facebook question of

928
00:41:11,160 --> 00:41:14,040
Speaker 1: the week, which is from McHale. Is that how you

929
00:41:14,040 --> 00:41:16,640
Speaker 1: would say this? Okay? Yeah, actually done. This was not

930
00:41:16,680 --> 00:41:19,200
Speaker 1: somebody who sent us a voice memo. It's written out

931
00:41:19,200 --> 00:41:22,360
Speaker 1: over in Facebook. But Mikale wrote, so I am wondering something.

932
00:41:22,560 --> 00:41:23,920
Speaker 1: I hear that one of the first things you do

933
00:41:24,000 --> 00:41:26,040
Speaker 1: to invest is buy into the s and P five

934
00:41:26,120 --> 00:41:30,160
Speaker 1: hundred index. But what does that really mean? I have

935
00:41:30,200 --> 00:41:32,920
Speaker 1: a fidelity account and there isn't much there, but I

936
00:41:33,040 --> 00:41:36,680
Speaker 1: bought one S and P five hundred. I'm assuming that's

937
00:41:36,680 --> 00:41:39,759
Speaker 1: a share. How much do I really buy? Or is

938
00:41:39,800 --> 00:41:43,960
Speaker 1: it like a one and done deal? Joel Is Michale

939
00:41:44,000 --> 00:41:44,840
Speaker 1: done with investing?

940
00:41:45,000 --> 00:41:47,560
Speaker 2: Are they said one share that's all you need, You're fine?

941
00:41:47,640 --> 00:41:48,680
Speaker 2: Or should they keep at it?

942
00:41:49,040 --> 00:41:49,239
Speaker 1: Well?

943
00:41:49,239 --> 00:41:51,440
Speaker 2: No, I mean I think this opens up actually a

944
00:41:51,480 --> 00:41:54,399
Speaker 2: litany of questions. Really, but maybe first we should say

945
00:41:54,480 --> 00:41:56,800
Speaker 2: what the S and P five hundred is, Matt And basically,

946
00:41:56,840 --> 00:41:58,080
Speaker 2: it's an index.

947
00:41:57,719 --> 00:42:00,200
Speaker 1: Of It's a collection. I guess we shouldn't use the name.

948
00:42:00,200 --> 00:42:04,320
Speaker 2: Of the definition collection of companies. And you're buying slices

949
00:42:04,320 --> 00:42:06,640
Speaker 2: and dices of each one of these companies five hundred

950
00:42:06,680 --> 00:42:09,200
Speaker 2: companies at one time. When you buy a single share

951
00:42:09,440 --> 00:42:11,000
Speaker 2: of an S and P five hundred index fund, and

952
00:42:11,040 --> 00:42:13,400
Speaker 2: so it's called the SMP five hundred, you own a

953
00:42:13,400 --> 00:42:16,480
Speaker 2: small amount of Apple, a small amount of Nvidia, small

954
00:42:16,520 --> 00:42:19,160
Speaker 2: amount of Tesla Coca Cola. I mean there you can go.

955
00:42:19,200 --> 00:42:22,560
Speaker 1: Amount of Dell, which was most recently added to the SMP.

956
00:42:22,840 --> 00:42:25,239
Speaker 2: Okay, so yeah, we can name four hundred ninety five

957
00:42:25,320 --> 00:42:28,600
Speaker 2: more companies, but we won't. We will relent. But basically

958
00:42:28,680 --> 00:42:31,080
Speaker 2: that's what you're doing. You're becoming an investor. You're becoming

959
00:42:31,120 --> 00:42:33,960
Speaker 2: a partial owner in every single one of those companies,

960
00:42:33,960 --> 00:42:35,680
Speaker 2: which is kind of cool when you think about it,

961
00:42:35,760 --> 00:42:36,600
Speaker 2: you're like, super cool.

962
00:42:36,680 --> 00:42:38,680
Speaker 1: I make the S and P five hundred like the

963
00:42:38,719 --> 00:42:40,040
Speaker 1: coolest thing out there. Yeah, I love it.

964
00:42:40,080 --> 00:42:42,360
Speaker 2: You don't run the joint at any one of those companies,

965
00:42:42,360 --> 00:42:44,480
Speaker 2: but you have a stake in their success.

966
00:42:44,680 --> 00:42:46,200
Speaker 1: So I am all in on the S and P

967
00:42:46,239 --> 00:42:48,839
Speaker 1: five hundred. If folks are wondering, uh, yeah, I don't

968
00:42:48,880 --> 00:42:51,400
Speaker 1: do the total stock market. I like the five hundred

969
00:42:51,480 --> 00:42:53,720
Speaker 1: biggest companies that are out there. There you go, another

970
00:42:53,800 --> 00:42:56,120
Speaker 1: little side SMP five hundred trivia note. Do you know

971
00:42:56,160 --> 00:42:59,239
Speaker 1: how often they rebalance and decide what companies get to

972
00:42:59,280 --> 00:43:01,200
Speaker 1: be a part of the people? Oh, I don't know.

973
00:43:01,239 --> 00:43:03,400
Speaker 2: I saw that Nvidia just made it into the Dow Jones,

974
00:43:03,400 --> 00:43:05,759
Speaker 2: which is a different index with far fewer companies. But

975
00:43:05,800 --> 00:43:06,879
Speaker 2: I'm going to say once a year.

976
00:43:07,000 --> 00:43:10,440
Speaker 1: It's quarterly, so four times a year, and I think

977
00:43:10,480 --> 00:43:14,600
Speaker 1: I saw that. Interestingly enough, American Airlines as well as Etsy,

978
00:43:14,920 --> 00:43:17,799
Speaker 1: they both got the boot. Oh yeah, they're no longer

979
00:43:17,880 --> 00:43:19,040
Speaker 1: part of the five hunder club.

980
00:43:19,080 --> 00:43:22,640
Speaker 2: And so that is the I think selling point for

981
00:43:22,760 --> 00:43:25,000
Speaker 2: something like an S and P five hundred index fund

982
00:43:25,000 --> 00:43:26,080
Speaker 2: is that it's self cleansing to a.

983
00:43:26,080 --> 00:43:26,960
Speaker 1: Certain extent as well.

984
00:43:27,040 --> 00:43:30,680
Speaker 2: Right, they kick out companies who aren't holding up their

985
00:43:30,719 --> 00:43:31,839
Speaker 2: bargain and.

986
00:43:31,840 --> 00:43:33,839
Speaker 1: So get too small are and being traded enough.

987
00:43:33,920 --> 00:43:36,480
Speaker 2: All these indexes do that, right, because when the Dow

988
00:43:36,600 --> 00:43:41,360
Speaker 2: Jones took on in Nvidia, they kicked out Intel and saying, listen,

989
00:43:41,400 --> 00:43:42,080
Speaker 2: you guys, you.

990
00:43:41,960 --> 00:43:44,760
Speaker 1: Guys have been slapping the face. Yeah, but it makes.

991
00:43:44,560 --> 00:43:46,479
Speaker 2: Sense, right, It makes sense that investors at some point

992
00:43:46,520 --> 00:43:49,359
Speaker 2: don't want to own that index if it's holding on to.

993
00:43:49,239 --> 00:43:51,239
Speaker 1: Too much crap. Dow Jones was like, I want some

994
00:43:51,320 --> 00:43:54,840
Speaker 1: of that new thing over there, that Invidia, Intel you

995
00:43:54,880 --> 00:43:57,440
Speaker 1: were cool like twenty years ago, but they haven't kept

996
00:43:57,520 --> 00:43:58,240
Speaker 1: up with the times.

997
00:43:58,480 --> 00:44:02,200
Speaker 2: And so I think it's this is huge for Michail, like,

998
00:44:02,280 --> 00:44:04,960
Speaker 2: congrats on this new beginning becoming an investor, and Matt,

999
00:44:04,960 --> 00:44:06,839
Speaker 2: I don't know about you. I still remember those early

1000
00:44:06,880 --> 00:44:11,320
Speaker 2: months trying to figure out all the terminology around investing.

1001
00:44:12,040 --> 00:44:14,840
Speaker 2: There are contribution limits, there are different account types, there

1002
00:44:14,840 --> 00:44:17,000
Speaker 2: are different index funds, and so it can feel like

1003
00:44:17,680 --> 00:44:19,960
Speaker 2: a fire hose of information coming at you. Yeah, I

1004
00:44:20,000 --> 00:44:22,080
Speaker 2: get that, and so that the whole goal of this podcast,

1005
00:44:22,120 --> 00:44:24,040
Speaker 2: if you listen over long enough time, is that you

1006
00:44:24,120 --> 00:44:26,520
Speaker 2: become super familiar with those terms and you feel confident

1007
00:44:26,520 --> 00:44:29,680
Speaker 2: in your ability to invest and make money. Well, one

1008
00:44:29,719 --> 00:44:33,840
Speaker 2: of the biggest mistakes that early investors actually make is

1009
00:44:33,880 --> 00:44:36,600
Speaker 2: sticking money into one of their tax advantage retirement accounts,

1010
00:44:36,800 --> 00:44:39,680
Speaker 2: but then they don't invest the money. It's like sitting

1011
00:44:39,719 --> 00:44:42,440
Speaker 2: on the sidelines in cash. Yes it's inside of the account,

1012
00:44:42,680 --> 00:44:45,400
Speaker 2: but you didn't buy a fund inside of that. McHale's

1013
00:44:45,440 --> 00:44:48,040
Speaker 2: not making that mistake. At least he has bought shares

1014
00:44:48,160 --> 00:44:49,920
Speaker 2: of the S and P five hundred and this is.

1015
00:44:49,880 --> 00:44:50,279
Speaker 1: A good thing.

1016
00:44:50,320 --> 00:44:53,000
Speaker 2: Now he is actually an investor, that's right.

1017
00:44:53,080 --> 00:44:56,080
Speaker 1: Yeah, And he's also doing business with Fidelity, which makes

1018
00:44:56,120 --> 00:44:58,759
Speaker 1: him a genius man. He's like, because multiple steps along

1019
00:44:58,800 --> 00:45:00,759
Speaker 1: the right pat you're gonna get the ultra low cost

1020
00:45:00,760 --> 00:45:02,719
Speaker 1: funds that are over there. I'm thinking of f Z

1021
00:45:02,920 --> 00:45:06,360
Speaker 1: Rocks for instance. That's their total stock market fund that

1022
00:45:06,440 --> 00:45:09,279
Speaker 1: a lot of fire folks are all about. But they

1023
00:45:09,280 --> 00:45:12,400
Speaker 1: don't charge any expenses on that fund.

1024
00:45:12,400 --> 00:45:14,440
Speaker 2: But I'm curious, which is career because most funds have

1025
00:45:14,640 --> 00:45:17,480
Speaker 2: even though minimal, they have some sort of expensory here

1026
00:45:17,520 --> 00:45:19,840
Speaker 2: point zero even feel it so like, but FC rocks

1027
00:45:19,880 --> 00:45:21,560
Speaker 2: is one of those things. At fidelly On, I think

1028
00:45:21,560 --> 00:45:23,399
Speaker 2: they have like four or six of those funds. Yeah,

1029
00:45:23,400 --> 00:45:25,560
Speaker 2: and it's cool because like they rolled that out maybe

1030
00:45:25,680 --> 00:45:29,160
Speaker 2: three years ago. It's legit freec free.

1031
00:45:29,320 --> 00:45:31,040
Speaker 1: I like free. We're talking about the actual things that

1032
00:45:31,040 --> 00:45:34,080
Speaker 1: you're investing in, or the we're talking about the I

1033
00:45:34,080 --> 00:45:36,000
Speaker 1: guess the passengers that you'd put in the vehicle, but

1034
00:45:36,040 --> 00:45:38,239
Speaker 1: let's talk about the actual vehicle, because I'm curious which

1035
00:45:38,280 --> 00:45:41,360
Speaker 1: account you are investing in, because our favorite for almost

1036
00:45:41,360 --> 00:45:44,120
Speaker 1: all new investors out there is to start by getting

1037
00:45:44,600 --> 00:45:46,320
Speaker 1: the match first of all, in there your four with

1038
00:45:46,440 --> 00:45:48,360
Speaker 1: K if you've got one of those, But if you

1039
00:45:48,360 --> 00:45:51,000
Speaker 1: don't have one, the roth Ira is going to be

1040
00:45:51,040 --> 00:45:54,800
Speaker 1: your next bet. And that's because of the tax advantage

1041
00:45:54,960 --> 00:45:59,040
Speaker 1: nature of it. After that, a taxable brokerage account is

1042
00:45:59,120 --> 00:46:00,799
Speaker 1: what you might wait, you're gonna look at it. That's

1043
00:46:00,880 --> 00:46:03,560
Speaker 1: usually reserved though after you've been crushing it in those

1044
00:46:03,760 --> 00:46:06,799
Speaker 1: tax advantaged accounts for years. And that's one of the

1045
00:46:06,840 --> 00:46:09,880
Speaker 1: things with Fidelity. I thought to myself, Man, it's been

1046
00:46:09,880 --> 00:46:11,840
Speaker 1: a while since I've opened a new account, what Fidelity,

1047
00:46:12,120 --> 00:46:14,840
Speaker 1: And I was curious to see how they position or

1048
00:46:14,840 --> 00:46:17,759
Speaker 1: how they lay out the choices, and I was surprised

1049
00:46:17,760 --> 00:46:21,040
Speaker 1: to see that it felt like the default option was

1050
00:46:21,080 --> 00:46:25,840
Speaker 1: the brokerage account. They actually call it the Fidelity account

1051
00:46:25,920 --> 00:46:28,680
Speaker 1: with a little trademark, little symbol after it, to make

1052
00:46:28,719 --> 00:46:30,279
Speaker 1: it seem like, oh, well, this is the one that

1053
00:46:30,320 --> 00:46:32,719
Speaker 1: I should be I should be choosing. Well, it's like

1054
00:46:33,200 --> 00:46:35,399
Speaker 1: and I don't think they're doing it maliciously. I think

1055
00:46:35,400 --> 00:46:38,719
Speaker 1: it's just maybe like just poor like user interface kind

1056
00:46:38,719 --> 00:46:40,360
Speaker 1: of thing they should be highlighting for most people with

1057
00:46:40,480 --> 00:46:42,720
Speaker 1: roth Ira, Yes, yeah, like that should be the first

1058
00:46:43,120 --> 00:46:43,520
Speaker 1: I don't know.

1059
00:46:43,600 --> 00:46:45,240
Speaker 2: I mean that's what knock on a lot of those

1060
00:46:45,640 --> 00:46:50,560
Speaker 2: those different new, newer brokerage firms. Specifically, for a long

1061
00:46:50,600 --> 00:46:52,480
Speaker 2: time they didn't have access to any retirement accounts and

1062
00:46:52,480 --> 00:46:53,120
Speaker 2: that was a huge problem.

1063
00:46:53,239 --> 00:46:55,160
Speaker 1: That's the first thing you should be focused on. But yeah,

1064
00:46:55,440 --> 00:46:57,239
Speaker 1: that kind of bothered me a little bit, the fact

1065
00:46:57,320 --> 00:46:59,560
Speaker 1: that and they even highlighted it. They're like, you can

1066
00:46:59,600 --> 00:47:02,400
Speaker 1: get investing with just one dollar, and made it seem

1067
00:47:02,400 --> 00:47:04,120
Speaker 1: like sort of the entry point for most folks, and

1068
00:47:04,160 --> 00:47:06,399
Speaker 1: that's the that's the one sort of thing that stood

1069
00:47:06,440 --> 00:47:08,000
Speaker 1: out to me. Then I thought, man, I don't really

1070
00:47:08,080 --> 00:47:10,279
Speaker 1: like the fact that it seems like they're steering folks

1071
00:47:10,360 --> 00:47:13,000
Speaker 1: to that. Again, I don't think they're doing that intentionally.

1072
00:47:13,120 --> 00:47:15,360
Speaker 1: But you want to make sure that you are contributing

1073
00:47:15,400 --> 00:47:17,440
Speaker 1: first to your roth Ira one hundred percent.

1074
00:47:17,680 --> 00:47:20,719
Speaker 2: And this might sound counterintuitive, but also don't invest too

1075
00:47:20,800 --> 00:47:24,400
Speaker 2: much too early, like check out our seven money gears

1076
00:47:24,400 --> 00:47:26,800
Speaker 2: on the website, because we just don't want you investing

1077
00:47:27,360 --> 00:47:29,880
Speaker 2: too much and then having to pull it out at

1078
00:47:29,920 --> 00:47:32,520
Speaker 2: an inopportune time. Matt, you've shared the story before on

1079
00:47:32,600 --> 00:47:34,560
Speaker 2: the on the pod about how you open up the

1080
00:47:34,600 --> 00:47:36,239
Speaker 2: roth Ira you stuck money in and then you're like,

1081
00:47:36,239 --> 00:47:37,040
Speaker 2: wait a second.

1082
00:47:36,880 --> 00:47:39,000
Speaker 1: Because I heard that was the ticket to being wealthy.

1083
00:47:39,000 --> 00:47:40,840
Speaker 2: I don't have any liquid cash anymore, and so now

1084
00:47:40,840 --> 00:47:43,279
Speaker 2: I need to pull money out from the roth and

1085
00:47:43,800 --> 00:47:44,879
Speaker 2: like it was far too soon.

1086
00:47:45,000 --> 00:47:46,799
Speaker 1: It's not often that I make mistakes show, but when

1087
00:47:46,840 --> 00:47:48,000
Speaker 1: I do that, they're big.

1088
00:47:48,160 --> 00:47:50,160
Speaker 2: Well, we'll highlight the two you've ever made in your

1089
00:47:50,160 --> 00:47:52,840
Speaker 2: life here on the show on a repeat basis. And

1090
00:47:52,880 --> 00:47:56,480
Speaker 2: so basically, if if you are investing, if you're sticking

1091
00:47:56,480 --> 00:47:58,680
Speaker 2: the money in. Make sure you have enough cash in

1092
00:47:58,760 --> 00:48:02,440
Speaker 2: liquid reserve in a same these account so you can

1093
00:48:02,520 --> 00:48:04,560
Speaker 2: leave it in. The whole goal is to invest the

1094
00:48:04,640 --> 00:48:07,520
Speaker 2: dollars for decades and then continue to invest more dollars.

1095
00:48:07,840 --> 00:48:09,320
Speaker 2: That's what's going to lead you down the road of

1096
00:48:09,360 --> 00:48:12,680
Speaker 2: financial independence. So set up a recurring investment into that

1097
00:48:12,760 --> 00:48:16,120
Speaker 2: roth ira, buying an index fund like FZ Rocks like

1098
00:48:16,120 --> 00:48:19,359
Speaker 2: Matt mentioned, or a similar fund, so that you, as

1099
00:48:19,400 --> 00:48:22,319
Speaker 2: our friend Nick Majuli would say, just keep buying. And

1100
00:48:23,239 --> 00:48:26,319
Speaker 2: it's really not much more complicated than that. There are

1101
00:48:26,800 --> 00:48:28,359
Speaker 2: some people out there who might want to make it

1102
00:48:28,440 --> 00:48:32,520
Speaker 2: sound like it's rocket science, but pretty simply, it's choosing

1103
00:48:32,640 --> 00:48:36,800
Speaker 2: the best tax advantaged account with low costs and a diverse,

1104
00:48:36,880 --> 00:48:40,040
Speaker 2: well diversified index fund and socking money in regularly over

1105
00:48:40,040 --> 00:48:42,160
Speaker 2: the course of decades. And you'll wake up one morning

1106
00:48:42,160 --> 00:48:44,880
Speaker 2: and be like, wait a second, I've got high six figures.

1107
00:48:44,920 --> 00:48:47,520
Speaker 2: I've got seven figures worth're monning on hand. How did

1108
00:48:47,520 --> 00:48:49,120
Speaker 2: that happen? It was just doing the right thing on

1109
00:48:49,200 --> 00:48:51,560
Speaker 2: repeat for but sure that long period of time.

1110
00:48:51,680 --> 00:48:53,319
Speaker 1: That's right, Joe. But let's go ahead and get back

1111
00:48:53,320 --> 00:48:55,800
Speaker 1: to the beer that you and I enjoyed during this episode,

1112
00:48:55,800 --> 00:48:59,640
Speaker 1: which was a breakfast anti Meridium by Monday Night Brewing.

1113
00:49:00,040 --> 00:49:03,799
Speaker 1: What were your thoughts on this one, buddy, dude, all I.

1114
00:49:03,800 --> 00:49:07,840
Speaker 2: Can say is it was fantastic, so good, absolutely lovely,

1115
00:49:08,040 --> 00:49:11,759
Speaker 2: and this is the perfect fall beer. I love a

1116
00:49:11,800 --> 00:49:14,600
Speaker 2: good Imperial Brown at the Curial Brown. We talked recently

1117
00:49:14,600 --> 00:49:18,120
Speaker 2: about how regular brownailes kind of suck, but like Imperial

1118
00:49:18,160 --> 00:49:19,759
Speaker 2: brownails are where it's at, and this.

1119
00:49:19,719 --> 00:49:22,560
Speaker 1: Is a perfect Regular browns are good if you're not

1120
00:49:22,600 --> 00:49:25,440
Speaker 1: looking for something that's quite as beastly as as this

1121
00:49:25,480 --> 00:49:25,840
Speaker 1: guy is.

1122
00:49:25,840 --> 00:49:27,480
Speaker 2: Sorry, I want the beast sleep. And this one was

1123
00:49:27,520 --> 00:49:29,200
Speaker 2: aged in maple bourbon barrels.

1124
00:49:29,239 --> 00:49:31,279
Speaker 1: I think the maple is strong with this one. It's

1125
00:49:31,320 --> 00:49:34,319
Speaker 1: so strong in with the coffee and the vanilla. It's

1126
00:49:34,320 --> 00:49:36,640
Speaker 1: like this you're sitting down to breakfast, breakfast out made

1127
00:49:36,640 --> 00:49:38,400
Speaker 1: in heaven. It's like you're enjoying some pancakes with the

1128
00:49:38,440 --> 00:49:42,280
Speaker 1: maple syrup poured over topes, along with a nice mug

1129
00:49:42,360 --> 00:49:46,400
Speaker 1: of some freshly brewed preferably ground in the burgrinder, with

1130
00:49:46,440 --> 00:49:48,680
Speaker 1: a V sixty four over a cup of coffee. He

1131
00:49:48,760 --> 00:49:51,839
Speaker 1: lost me there at your side. I've heard these terms.

1132
00:49:51,840 --> 00:49:53,399
Speaker 1: It's so stinking good, so you want to. I don't

1133
00:49:53,400 --> 00:49:54,839
Speaker 1: know if I ever told you the story, but I

1134
00:49:54,920 --> 00:49:57,680
Speaker 1: was shooting an event at Monday Night Brewing. It was

1135
00:49:57,719 --> 00:50:00,920
Speaker 1: a wedding and Peter he he had recently taken over

1136
00:50:01,320 --> 00:50:03,439
Speaker 1: as headbroommaster there at Monday Night, and was like, hey

1137
00:50:03,520 --> 00:50:05,680
Speaker 1: what because he knew I was into beer. And this

1138
00:50:05,719 --> 00:50:08,040
Speaker 1: is like fifteen years ago, but even then he was

1139
00:50:08,040 --> 00:50:09,399
Speaker 1: just like, hey, I know you're into it when once

1140
00:50:09,440 --> 00:50:11,239
Speaker 1: you come back here and have a taste. And I

1141
00:50:11,280 --> 00:50:13,520
Speaker 1: got to have a taste of this, like straight out

1142
00:50:13,520 --> 00:50:17,319
Speaker 1: of the giant, I don't know, big silver thing, and

1143
00:50:17,440 --> 00:50:19,040
Speaker 1: I was I think at that point in time, I

1144
00:50:19,120 --> 00:50:21,480
Speaker 1: knew that Money Night had made an excellent decision in

1145
00:50:21,560 --> 00:50:24,440
Speaker 1: hiring him. Like he had a wine he was like

1146
00:50:24,440 --> 00:50:27,080
Speaker 1: a wine stop. He had a wine background, and then

1147
00:50:27,360 --> 00:50:30,439
Speaker 1: came into the beer scene and quickly turned things around

1148
00:50:30,440 --> 00:50:31,840
Speaker 1: when it came to Monday Night and some of the

1149
00:50:31,920 --> 00:50:35,480
Speaker 1: amazing beers that they were that shortly after him taking over,

1150
00:50:35,520 --> 00:50:36,759
Speaker 1: that they were putting out there, but.

1151
00:50:36,960 --> 00:50:39,160
Speaker 2: They I mean they went for still so good. They

1152
00:50:39,200 --> 00:50:41,920
Speaker 2: went from a five to a ten pretty quickly. You know,

1153
00:50:41,960 --> 00:50:44,200
Speaker 2: when when Peter started making the beers and and this

1154
00:50:44,360 --> 00:50:46,560
Speaker 2: is there's they were fine, they were solid back in

1155
00:50:46,600 --> 00:50:48,720
Speaker 2: the day, but man, this is one of the finest

1156
00:50:48,800 --> 00:50:50,680
Speaker 2: examples of his work. He took it to a whole

1157
00:50:50,719 --> 00:50:51,120
Speaker 2: new level.

1158
00:50:51,160 --> 00:50:52,560
Speaker 1: And then was the first time though that I've ever

1159
00:50:52,600 --> 00:50:55,000
Speaker 1: had the breakfast variant, which you know, you get all

1160
00:50:55,040 --> 00:50:59,320
Speaker 1: these additional adjunct flavors going on and makes it incredibly enjoyable.

1161
00:50:59,320 --> 00:51:02,719
Speaker 1: And sometimes to share with you, those adjuncts are overpowering

1162
00:51:03,040 --> 00:51:05,080
Speaker 1: or I hate it when it changes the texture of

1163
00:51:05,120 --> 00:51:06,920
Speaker 1: the bear right, like when they don't do a good

1164
00:51:06,960 --> 00:51:09,040
Speaker 1: job filtering it out, or maybe they don't want to filter.

1165
00:51:08,920 --> 00:51:10,160
Speaker 2: The base beer is kind of lame and they think

1166
00:51:10,200 --> 00:51:11,759
Speaker 2: the adjuncts are going to cover it up. No, this

1167
00:51:11,840 --> 00:51:15,120
Speaker 2: is a great beer with like the solid highlighting it.

1168
00:51:15,239 --> 00:51:18,040
Speaker 1: Yeah, It's like it's like getting a really nice looking

1169
00:51:18,080 --> 00:51:20,800
Speaker 1: Christmas tree, but then you've also got the beautiful ornaments.

1170
00:51:20,800 --> 00:51:22,480
Speaker 1: Because if you just get like a scrawny looking tree

1171
00:51:22,480 --> 00:51:24,600
Speaker 1: and you put like the silly Charlie Brown style, yeah,

1172
00:51:24,640 --> 00:51:26,319
Speaker 1: then it's just it's kind of it's kind of sad.

1173
00:51:26,360 --> 00:51:28,680
Speaker 1: You know, I wish Snoopy did Wonders with history. We

1174
00:51:28,719 --> 00:51:30,840
Speaker 1: could have done better. Maybe with the original tree, this

1175
00:51:31,239 --> 00:51:33,360
Speaker 1: had it all, but buddy. That's going to be it

1176
00:51:33,400 --> 00:51:35,440
Speaker 1: for this episode. You can find show notes up on

1177
00:51:35,480 --> 00:51:37,719
Speaker 1: the website at howtomoney dot com. We'll make sure to

1178
00:51:37,800 --> 00:51:40,479
Speaker 1: link to some of the different resources that we mentioned,

1179
00:51:40,560 --> 00:51:43,759
Speaker 1: including a link to that website Honest Math, where if

1180
00:51:43,840 --> 00:51:46,560
Speaker 1: you're starting to want to crunch the numbers, you're getting

1181
00:51:46,560 --> 00:51:48,320
Speaker 1: a little bit closer to retirement and you want to

1182
00:51:48,360 --> 00:51:50,879
Speaker 1: see maybe how long your money's going to last. What's

1183
00:51:50,920 --> 00:51:52,600
Speaker 1: amazing about that site is they run a bunch of

1184
00:51:52,600 --> 00:51:55,279
Speaker 1: like they run a Monte Carlo simulation on it, and

1185
00:51:55,320 --> 00:51:58,359
Speaker 1: they run through like thousands of different scenarios and they

1186
00:51:58,360 --> 00:52:01,440
Speaker 1: give you the average, to give you the median as well,

1187
00:52:01,440 --> 00:52:03,120
Speaker 1: and then you can make an informed decision from there.

1188
00:52:03,200 --> 00:52:06,160
Speaker 1: It's like what Nate Silver is to political polling, they

1189
00:52:06,239 --> 00:52:10,359
Speaker 1: are to your money and retirement simulations. That's right, all right, Yeah,

1190
00:52:10,360 --> 00:52:13,240
Speaker 1: you can look for that up at how somemoney dot com.

1191
00:52:13,320 --> 00:52:15,360
Speaker 1: You're gonna take us out. Sure, that's gonna do it

1192
00:52:15,360 --> 00:52:17,919
Speaker 1: for this one. Until next time, Best Friends Out, Best

1193
00:52:18,040 --> 00:52:18,959
Speaker 1: Friends Out.