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Speaker 1: Welcome to How the Money. I'm Joel, I'm Matt. Today

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Speaker 1: we're answering your listener questions.

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Speaker 2: That's right, buddy, Happy Monday to everybody, and we are

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Speaker 2: going to take a question regarding some housing rules of thumb.

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Speaker 2: Is specifically what this listener is asking for, Joel, we'll

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Speaker 2: get to that. Another listener is trying to find a

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Speaker 2: way out of boat payments. That's not something that we

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Speaker 2: talk a lot about here on the show boat payments.

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Speaker 2: I don't even like car payments, so I think a

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Speaker 2: lot of folks know where we might end up lanning

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Speaker 2: that one.

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Speaker 1: In particular insurance fraud, like just big rock in the

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Speaker 1: boat syncing into the middle of the lake and then

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Speaker 1: file the claim.

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Speaker 2: But we won't suggest that try to avoid a legal

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Speaker 2: recommendation of such terrible. Another listener is looking to make

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Speaker 2: bank on the World Cup as well, so we're going

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Speaker 2: to talk about maybe the best ways to do that.

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Speaker 2: But let's get personal here for a second. Joel. I

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Speaker 2: think it was last week we talked about the coffee

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Speaker 2: bar that I've been working on there in the house,

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Speaker 2: and the listener reached out. It was just like, oh, what,

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Speaker 2: like someone who knows I'm into coffee, and we're diving

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Speaker 2: a little more into the specifics. And what we didn't

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Speaker 2: talk about was the fact that I want to get

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Speaker 2: in this expressing machine. And so the most.

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Speaker 1: Expensive thing is not the renovation, it's the machine you

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Speaker 1: want to put in the finished.

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Speaker 2: Product, because I'm looking at spending thousands of dollars specifically

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Speaker 2: on the suspresso machine, which sounds ridiculous and it is.

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Speaker 2: But I've been into coffee for quite a while, not

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Speaker 2: like literally decades. We started out back in the day

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Speaker 2: with the very affordable blade grinder with a little French press,

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Speaker 2: as you do right, like you kind of start off.

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Speaker 2: That's the gateway coffee drug, coffee at coffee being an

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Speaker 2: actual drug.

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Speaker 1: It's a thing you do after mister coffee maker feel

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Speaker 1: a little subpar exactly, that.

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Speaker 2: You just kind of work your way up. And that's

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Speaker 2: something we've done over the years, and all that's left, man,

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Speaker 2: and I would love to take it to this next level,

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Speaker 2: to go full bore, is to have an express machine

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Speaker 2: at home. You know, I think I pinpointed why or

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Speaker 2: when this all started as far as me researching and

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Speaker 2: getting into it, I think it was Zeke Fox. Do

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Speaker 2: you remember what his craft beer equivalent was was coffee,

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Speaker 2: wasn't it. It was an espresso machine specifically, And we

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Speaker 2: talked about it some after we got done manhatt and

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Speaker 2: with like three kids, didn't he h Zeke, that's you're

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Speaker 2: my dude, Like, this is exactly my thing, And I

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Speaker 2: researched it and I've been kind of keeping an eye

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Speaker 2: on Well.

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Speaker 1: He was interesting too, because he just the he had

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Speaker 1: his finger on the pull of what was happening in

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Speaker 1: crazy cryptocurrency ormand free.

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Speaker 2: Yeah, hanging out with him and interviewing him and all that. Anyway,

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Speaker 2: all that to say, this is not some sort of

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Speaker 2: like I guess sudden realization that oh I would love

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Speaker 2: to be able to have espresso at home. But I'm

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Speaker 2: imploring you to well, maybe I don't want you to

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Speaker 2: talk me out of it, but do you think that

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Speaker 2: this is a terrible idea. I was going to say,

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Speaker 2: talk me out of it, but I truly don't want

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Speaker 2: you to talk me out of it, because this is

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Speaker 2: something it's something I want to do. I say, I don't.

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Speaker 1: I don't think you do want me to do that,

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Speaker 1: because I think this is something you've been talking about

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Speaker 1: for a long enough time, and you and I were

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Speaker 1: talking about this the other day, how my sauna is

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Speaker 1: kind of maybe the equivalent of oh yeah, this espressho

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Speaker 1: purchase for you, right, espresso machine purchase?

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Speaker 2: Well yeah, And specifically it's because of like the if

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Speaker 2: you view it as a tool and like that or

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Speaker 2: as gear, like Michael Easter talks about, like he talks

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Speaker 2: about viewing certain purchases as gear, not as sort of

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Speaker 2: like this consumption based product. And okay, so on that note,

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Speaker 2: like we were talking about this, I think the conversation

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Speaker 2: that you're referring to that we had probably over pizza

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Speaker 2: and beer or something like that. But it's different like

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Speaker 2: when you talk about spending money in ways that bring

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Speaker 2: you happiness, a lot of times it is experiences, right,

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Speaker 2: And the problem with that is you kind of have

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Speaker 2: to continually, like you don't just want to rest on

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Speaker 2: a great vacation or a great experience that you had

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Speaker 2: years ago in the next one. Exactly, you're looking ahead

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Speaker 2: and you're not necessarily looking to top it, but you

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Speaker 2: are looking to kind of maintain it. In an argument

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Speaker 2: for something that kind of acts as a tool or

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Speaker 2: as gear, is that yes, there is a big upfront

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Speaker 2: purchase cost associated with it. But dude, my ability to

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Speaker 2: pull espresso shots and steam amazing milk at home like

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Speaker 2: my DIY espresso, those additional ongoing costs are so minimal

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Speaker 2: compared to I think when I perceive the joy and

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Speaker 2: the memories that I'll be able to have making drinks

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Speaker 2: not only for me and K but also the kids

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Speaker 2: for friends who come over as well. Right, Like I

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Speaker 2: see it more maybe like you do as a sauna. Yeah, well,

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Speaker 2: I think we also something that makes things hot. Back

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Speaker 2: in the day, you and I we had an episode,

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Speaker 2: that's true. We had We did a full episode about

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Speaker 2: experiences versus things, and you would think it seems like

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Speaker 2: everybody comes down on the side of experiences.

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Speaker 1: It's the general prevailing wise choice. But I I think

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Speaker 1: especially some things might be a better purchase.

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Speaker 2: Then it might be money.

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Speaker 1: Your money might be better spent buying certain actual physical

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Speaker 1: items that kind of are perpetual experience inducing machines.

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Speaker 2: Right, yeah, Oh, I like that, And that's what experience inducing.

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Speaker 2: That is what I need to say to Joel said,

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Speaker 2: this is a perpetual experience inducing machine.

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Speaker 1: If we're honest, If we're honest, there are very few

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Speaker 1: items that meet that reality, that meet that threshold. Right,

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Speaker 1: most of the stuff we buy is isn't going to

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Speaker 1: even even the fancy car. What we get into the

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Speaker 1: experience oftentimes is lackluster after a month of ownership and

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Speaker 1: we're just like kind of bored with it. I get

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Speaker 1: just as jazz to hop in my sauna now as

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Speaker 1: I did when I first got it, and you know,

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Speaker 1: my wife and I hop in together, and it's it's

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Speaker 1: just lovely time well spent, not to imagine the supposed

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Speaker 1: health benefits that we're getting, right, Yeah, And I think

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Speaker 1: the same for you, like making coffee for you for

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Speaker 1: your family. But then all so for people who come

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Speaker 1: over you're like, hey, check out this.

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Speaker 2: I really am, Like I would be so stoked for

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Speaker 2: anybody who comes over and they're like, what is that

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Speaker 2: over there? I'm like, oh, let me show you. Let me. Yes,

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Speaker 2: I'm going to nerd out a little bit if you

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Speaker 2: want to nerd out about it, or I can just

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Speaker 2: make you a killer flat tailor a flat white if

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Speaker 2: that's what you're into.

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Speaker 1: So I guess from that ex most of us don't

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Speaker 1: think about that, And the truth is not again, not

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Speaker 1: many things hit that metric, but I think this will

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Speaker 1: for you, especially as someone who's gone down the coffee

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Speaker 1: rabbit hole to such an extent.

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Speaker 2: I like it so much.

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Speaker 1: I think you have to really be careful about what

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Speaker 1: you go and dive into to that extent, because you

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Speaker 1: were talking about this not till ago as well. How

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Speaker 1: that last fifteen or twenty percent you can get eighty

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Speaker 1: percent of the way they're on so many things for

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Speaker 1: very little money, But that last fifteen or twenty percent

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Speaker 1: whatever it is that you're committing to, can take so

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Speaker 1: much extra time, so much extra money. And so maybe

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Speaker 1: like limit your hobbies, your obsessiveness on certain hobbies because

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Speaker 1: it can get really expensive.

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Speaker 2: But what's so hard about it is that this is

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Speaker 2: like a new category that I've sort of just somebody

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Speaker 2: might say, oh, you've just created this brand new category

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Speaker 2: of spending, Whereas like my mind immediately goes to vehicles,

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Speaker 2: where I'm like, dude, somebody like, without even hardly thinking

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Speaker 2: about it, somebody will spend like I'm not even gonna

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Speaker 2: say how much money this shave it up to this

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Speaker 2: little Mazarco one that I'm looking at, it's thousands of dollars,

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Speaker 2: but like somebody would be more than willing to drop

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Speaker 2: ten times more than that, even like fifteen times more

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Speaker 2: than because it's normal for the court. Yeah, for like

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Speaker 2: the family safe vehicle or the one that's got the

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Speaker 2: good reviews or just one that they Yeah, that seems

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Speaker 2: normal to them. Uh, But like that's the thing, Like

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Speaker 2: I don't care about vehicles. We were just talking about. Yeah, man,

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Speaker 2: the fact that our car is gonna is going to

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Speaker 2: be rolling over two hundred thousand miles here pretty soon,

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Speaker 2: and I can't. Yeah, and you still don't want to upgrade,

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Speaker 2: but you do want to upgrade your coffeemaker exactly, And

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Speaker 2: I get that.

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Speaker 1: I can't wait for that, And I think that's again,

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Speaker 1: like that's what makes personal finance so fun is you

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Speaker 1: can be like, I don't care about any of that

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Speaker 1: other stuff, but I do. I'm gonna spend more of

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Speaker 1: my coffeemaker than in my car, And that's just like

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Speaker 1: a choice you can make the super d that most

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Speaker 1: people won't, and then.

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Speaker 2: The machine would be more worth more than the actual

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Speaker 2: car would end like Mad drives a twenty twelve Odyssey,

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Speaker 2: but he's got twenty twenty six Lemazar right exactly. But

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Speaker 2: and it's I'm fine with.

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Speaker 1: That that's part of knowing yourself, and it's such an

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Speaker 1: important part of personal finance because then you actually spend

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Speaker 1: money on this stuff that's going to light you up,

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Speaker 1: that's going to matter to you, and not just the

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Speaker 1: stuff that most people say is important.

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Speaker 2: Nice. Well, I appreciate you not totally shooting me down,

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Speaker 2: but providing context and in fact encouraging me go buy something.

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Speaker 1: It's your bolt. I can't wait to test it out.

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Speaker 1: Or yeah, I'm not actually gonna touch it because I'll

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Speaker 1: if I break it, I'll teach you. Then I have

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Speaker 1: to pay for it.

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Speaker 2: I'm not gonna do that. I'll teach you. Although it

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Speaker 2: seems like less your thing to get into the nerdery

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Speaker 2: behind it, I think you will definitely appreciate a.

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Speaker 1: Great flatwayes over over at the all mixed mode most stuff. Okay,

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Speaker 1: just mentioned the beer we're happening on this episode. It's

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Speaker 1: called U It's a West Coast hipA by Living Waters Brewing.

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Speaker 1: We'll give our thoughts on this one.

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Speaker 2: Does it have an actual name? I don't know.

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Speaker 1: We'll just call it Harpeth. All right, Well, we'll just

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Speaker 1: that's a terrible name. We'll call it there. I don't know,

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Speaker 1: maybe by a living waters and if you have a

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Speaker 1: money question, we'd love to hear from you. Just go

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Speaker 1: to how to money dot com slash ask for the

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Speaker 1: directions and hopefully we can take your money question on

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Speaker 1: the podcast next week.

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Speaker 2: That's right, Joel, let's kick things off. Let's take this

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Speaker 2: listener question. He is debating how much to spend on

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Speaker 2: one of the most expensive purchases you can make. Let's

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Speaker 2: hear it, Hi, Matt, and Joel.

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Speaker 3: This is Bailey from Texas. My question today's center is

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Speaker 3: around a house purchase and how to decide what's a

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Speaker 3: reasonable amount to spend on a home. I've a few

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Speaker 3: different ideas tossed around, things like don't spend more than

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Speaker 3: three to four times in annual household income, or maybe

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Speaker 3: don't make mortgage payments monthly that's more than twenty five

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Speaker 3: percent of a monthly household income. I worry, though, that

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Speaker 3: these numbers may change quite a bit over there the

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Speaker 3: course of a thirty year mortgage up or down. So

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Speaker 3: I'm just looking for some guidance on how to pick

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Speaker 3: that house number, or how to decide what's the sayer

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Speaker 3: reasonable amount to spend on a home purchase. Appreciate any

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Speaker 3: advice you guys have. Thank you for all you do.

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Speaker 1: Oh, Matt, Everyone's got advice on this. Everyone has their thoughts,

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Speaker 1: and I think people prioritize homes differently and how much

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Speaker 1: money they allocate towards their home differently. But I think

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Speaker 1: there's a lot to cover in in this question, a

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Speaker 1: lot of wide open room to run. And so I

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Speaker 1: guess the first thing I would say is be careful

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Speaker 1: who you listen to, because some people will give you.

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Speaker 2: Advice based on the right advice.

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Speaker 1: Yeah, And I remember specifically, like my dad got advice

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Speaker 1: about buying a home that was kind of near the

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Speaker 1: top of his budget. He was in like middle management,

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Speaker 1: and some of his friends who he worked with were like, dude,

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Speaker 1: you know you can afford this house. It might feel

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Speaker 1: like a stretch now, so you're going to get the

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Speaker 1: promotions you're going.

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Speaker 2: To get you with me and my exactly, go ahead

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Speaker 2: and get the one out there.

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Speaker 1: But you got this top notch Cadillac version, right, And man,

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Speaker 1: this was such bad advice, But I can see why

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Speaker 1: to that person who gave it, maybe they bought it,

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Speaker 1: maybe they did that same exact thing, and maybe they

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Speaker 1: did get the promotion and the rays and pretty quickly

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Speaker 1: the mortgage that they signed up for based on their

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Speaker 1: salary you know, from a couple of years ago, it

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Speaker 1: felt more than reasonable. In fact, they wish they had

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Speaker 1: bought more house because my goodness, they're just floating in

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Speaker 1: the money now, right, But it came back to bite

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Speaker 1: my dad and just in terms of well, the promotion,

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Speaker 1: the rays didn't happen, and the way and in fact

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Speaker 1: my dad lost his job and so you know, being

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Speaker 1: able to afford that mortgage became incredibly difficult. And so home,

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Speaker 1: I think is of course it's different than a car

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Speaker 1: because it's an appreciating asset on average over time, but

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Speaker 1: still overdoing it can have these cascading consequences that we

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Speaker 1: want you to avoid.

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Speaker 2: Really, that's true. Yeah, And while we were talking about

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Speaker 2: how much payment you can afford Bailey on your home,

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Speaker 2: we want you to have saved a decent chunk to

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Speaker 2: put down. So you didn't ask them about that, but

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Speaker 2: we're going to cover our bases. Ideally you want to

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Speaker 2: have twenty percent in order to get the best terms

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Speaker 2: for your mortgage to start with that. But yeah, are

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Speaker 2: a few different rules of them you could follow and

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Speaker 2: I do think the advice is different for most American

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Speaker 2: consumers out there, for mainstream America than it is for

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Speaker 2: folks who are listening to this podcast, because for us man,

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Speaker 2: the goal is to not just be able to afford

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Speaker 2: a home, to get your hands on the home to

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Speaker 2: live in it, but to be able to afford your

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Speaker 2: craft beer equivalent or your craft coffee equivalent, whatever it

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Speaker 2: might be, and also saving for your future goals alongside

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Speaker 2: that monthly mortgage payment. By the way, Bailey, you mentioned

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Speaker 2: you know it, should I be looking at the price

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Speaker 2: of the home? Should I be looking at like the mortgage?

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Speaker 2: And I don't think I'm going to share any rules

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Speaker 2: of thumb as far as like the price of the

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Speaker 2: home because of financing that is such a present reality

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Speaker 2: when it comes to what because normally we say, well, no,

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Speaker 2: you don't want to be, you don't want to be,

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Speaker 2: Oh what can I afford kind of payment byers? Oh yeah, yeah,

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Speaker 2: like what's the monthly payment going to be? But there

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Speaker 2: really isn't an alternative when it comes to purchasing, like

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Speaker 2: very much as in buying a car. Such a small

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Speaker 2: percentage of folks out there who could afford purchasing a

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Speaker 2: home outright, and so so much of it does come

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Speaker 2: down to the terms of the loan to what you're

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Speaker 2: able to afford on on a month to month basis.

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Speaker 2: That is where the rubber meets the mode the road

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Speaker 2: with your specific budget. So I think, yeah, mortgage specific

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Speaker 2: advice is what we're going to be looking at here.

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Speaker 2: But I'm talking about so these additional goals that you

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Speaker 2: might have, like financial independence, that is, for a lot

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Speaker 2: of folks, some degree of that, some degree of financial

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Speaker 2: freedom is the ultimate goal here, and being house poor

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Speaker 2: isn't necessarily in the financial independence recipe. And so I

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Speaker 2: think the best rule of thumb to consider is to

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Speaker 2: spend less than twenty five percent of your gross monthly

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Speaker 2: income on housing. And I do think this includes like

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Speaker 2: all of your housing spending. This, you know, not just

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Speaker 2: the mortgage specifically, like factor in taxes and insurance, like

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Speaker 2: gets real with these estimated payments. Don't just look at

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Speaker 2: you know, whatever it is that the bank might spit,

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Speaker 2: spit all at you and whether or not they are

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Speaker 2: including those additional numbers, don't. I don't think it has

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Speaker 2: to include utilities and other repairs, but you do need

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Speaker 2: to make sure you've got enough set aside to handle

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Speaker 2: those as well, especially if there's any deferred maintenance that

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Speaker 2: hasn't been addressed there on that property.

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Speaker 1: He has something you and I covered it on a

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Speaker 1: Friday flight recently, Matt.

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Speaker 2: But just that's this.

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Speaker 1: This the thorn in a lot of homeowners' sides right

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Speaker 1: now is maintenance costs on housing, and especially as costs

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Speaker 1: of risen on housing A ton like I was just

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Speaker 1: trying to get a quote on a minor like screen

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Speaker 1: screen Ports edition to my house. I was shocked. I

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Speaker 1: was shocked, and I was like, I think I'm gonna

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Speaker 1: hold off on this, like, don't x more than I

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Speaker 1: was expecting. Yeah, I don't know if I'm interested. And so

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Speaker 1: that's one of the things, whether you're doing something to

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Speaker 1: your house or just normal maintenance, wear and tear repairs,

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Speaker 1: you you might be shocked at the cost that some

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Speaker 1: of those some of those repairs are going to set

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Speaker 1: you back. So be very careful in planning for that

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Speaker 1: potential reality. I think you can also use I like

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Speaker 1: the twenty five percent rule without me giving I think

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Speaker 1: another good one is thirty percent of your take home pay,

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Speaker 1: that being like an all in amount. I think I

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Speaker 1: like this one best, Matt, because you're including all of

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Speaker 1: your likely monthly housing costs and you're not going above

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Speaker 1: thirty percent of your monthly post tax pay. And this

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Speaker 1: is like, it's great because you're including all the facts

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Speaker 1: on the ground, including what you pay in taxes, which

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Speaker 1: is another massive line item in your budget. You're already

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Speaker 1: kind of factoring that in. So for example, let's say

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Speaker 1: you make one hundred thousand dollars a year, your take

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Speaker 1: home pay might be like sixty five hundred dollars a month.

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Speaker 1: This means you could stomach a mortgage payment of about

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Speaker 1: twenty two hundred dollars and you could probably buy a house. Then,

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Speaker 1: if you're looking at what's happening in financing right now,

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Speaker 1: the costs about three hundred thousand dollars and be able

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Speaker 1: to comfortably afford it. But the better the terms and

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Speaker 1: the rate, you might be able to inflate that just

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Speaker 1: a little bit. Let's say you're able to get a

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Speaker 1: sick rate from a local credit union or something like that.

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Speaker 1: It's amazing how much those numbers can shift based on

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Speaker 1: kind of like you alluded to, Matt, the financing, where

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Speaker 1: you get that financing and what's being offered currently.

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Speaker 2: That's true. And again Bailey like, keep in mind these

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Speaker 2: are just rough rules of thumb, because I do think

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Speaker 2: for some frugal folks out there that it is okay

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Speaker 2: to intentionally spend more on your home if you find

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Speaker 2: that you spend a lot less in a lot of

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Speaker 2: other areas in your life. Like I'm thinking about, transportation

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Speaker 2: can vary wildly depending on what it is that you

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Speaker 2: like to drive, but even on like how much you

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Speaker 2: like month to month spending on groceries, for instance. And

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Speaker 2: so I'm thinking of like early Kate and I and

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Speaker 2: we didn't spend anything on transportation, We didn't spend anything

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Speaker 2: on our groceries.

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Speaker 1: Were still a one car family. You know, transportation costs

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Speaker 1: are incredibly low, so somebody like you can afford sure

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Speaker 1: if they want inflate their housing.

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Speaker 2: Budget a bit. Yeah, but specifically with groceries per person,

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Speaker 2: we were eating one dollar per meal there for a

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Speaker 2: stretch for a number of years, and because we were

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Speaker 2: just eating so frugally, also minimizing the amount of protein,

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Speaker 2: the amount of meat we're eating, which can be very expensive.

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Speaker 2: But if you are also content to drive like a

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Speaker 2: twenty year old car, maybe you rarely ever eat out.

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Speaker 2: I think something like thirty five even forty percent of

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Speaker 2: your take home pay on housing. It may not be

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Speaker 2: all that crazy, but you really do have to be

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Speaker 2: willing to reduce your spending in other areas in life

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Speaker 2: and in order to keep that housing budget budget reasonable

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Speaker 2: if you're I do think if you're going to splurge anywhere,

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Speaker 2: I think housing is a category that makes a big

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Speaker 2: impact and it can feel a bit less wasteful, and

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Speaker 2: I think it actually can be pretty consistent with frugality

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Speaker 2: if you are very intentional with your spending.

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Speaker 1: Yeah, and especially if you can turn your housing cost

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Speaker 1: into some sort of revenue stream, right like house hacking

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Speaker 1: or something you can you can bite off even more

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Speaker 1: if you're going to be able to rent that part

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Speaker 1: of your home out, or you're buying a duplex, or

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Speaker 1: you just have like a mother in law suite or

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Speaker 1: something like that that you're gonna you're gonna rent out

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Speaker 1: to cover some of those costs. That's a way too

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Speaker 1: that you can actually turn your housing into a revenue stream.

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Speaker 1: Is something we haven't talked about as much recently, Matt,

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Speaker 1: but it's just like something that deserves a lot of

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Speaker 1: attention for people who are concerned or interested in becoming

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Speaker 1: financially independent at an earlier age. Turning your housing from

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Speaker 1: like one of the largest line items in your budget

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Speaker 1: to something that comes closer to breaking even because you're

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Speaker 1: renting out a portion of that, it can change the

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Speaker 1: game significantly. And we've we've seen a bunch of our

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Speaker 1: of how to money listeners take that tactic and just

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Speaker 1: completely change their financial lives for decades to come. And

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Speaker 1: when it comes down to it, I think if you

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Speaker 1: value optionality Bailey less's best, like not having as many

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Speaker 1: dollars dedicated towards a roof over your head is going

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Speaker 1: to buy you more optionality over time. And we'll probably

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Speaker 1: get pushback on this map, but it's it certainly feels

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Speaker 1: like it's impossible to meet those standards. As a young

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Speaker 1: person trying to buy a home these days.

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Speaker 2: It's and it is like, yeah, good luck, run in

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Speaker 2: the house, guys.

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Speaker 1: Yeah not that right, Or you're just going to have

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Speaker 1: to meaningfully reduce kind of what your expectation are, right,

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Speaker 1: You're going to have to opt for something that is

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Speaker 1: maybe in not as great of a part of town,

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Speaker 1: or is smaller or needs more work and yeah, it

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Speaker 1: really is harder to meet this these metrics that we're

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Speaker 1: talking about in twenty twenty six much harder than it

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Speaker 1: was in twenty sixteen. Let's say, so, we get that,

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Speaker 1: we get that pushback, but we are seeing some corrective

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Speaker 1: moves in the housing market right now, which is leading

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Speaker 1: to lower prices. We're seeing more buyers have the ability

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Speaker 1: to negotiate that price down, whereas a few years ago

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Speaker 1: that wasn't the case. Basically, Ever, so, jumping into a

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Speaker 1: mortgage though that significantly bends or breaks the rules of

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Speaker 1: thumb that we're outlining, is really going to lead to

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Speaker 1: It's going to be detrimental to you. Not only does

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Speaker 1: it make it harder to hit savings goals for retirement,

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Speaker 1: for other near term goals, it's going to impact the

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Speaker 1: rest of your life, right think about saving for vacations,

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Speaker 1: dow the road, or updating your car later on, or

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Speaker 1: just the joyful spending you like to do that's not

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Speaker 1: housing related. This is the real reason to keep your

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Speaker 1: housing costs reasonable. Yeah, because absolutely you are hamstring yourself

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Speaker 1: if you dedicate too many of your financial resources toward

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Speaker 1: your monthly housing costs.

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Speaker 2: Totally. Yeah, Yeah, Bailey, he mentioned, well, what if over

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Speaker 2: the course of that thirty year mortgage, the percentage that

437
00:20:17,119 --> 00:20:20,440
Speaker 2: I have going towards that house increases or decreases even right,

438
00:20:20,480 --> 00:20:21,800
Speaker 2: like he was like, oh, it could be, it could

439
00:20:21,800 --> 00:20:24,159
Speaker 2: go either way. Well, first of all, if it decreases,

440
00:20:24,400 --> 00:20:27,000
Speaker 2: that's not really a problem. That's like, because that just

441
00:20:27,040 --> 00:20:28,640
Speaker 2: means you're making more money, like an anti problem.

442
00:20:28,720 --> 00:20:28,880
Speaker 4: Yeah.

443
00:20:28,920 --> 00:20:31,080
Speaker 2: Yeah, it's just like it's like someone saying, oh, man,

444
00:20:31,160 --> 00:20:33,720
Speaker 2: I'm in the thirty five percent tax bracket. Now it's like, okay,

445
00:20:33,720 --> 00:20:37,639
Speaker 2: you're fine, Like you're doing totally fine. You're gonna be okay.

446
00:20:38,000 --> 00:20:40,000
Speaker 2: But this is an argument, like what Joel's laying out here,

447
00:20:40,119 --> 00:20:42,879
Speaker 2: like that is an argument for being a little more conservative,

448
00:20:42,920 --> 00:20:45,240
Speaker 2: because yes, like what if you do experience a job loss.

449
00:20:45,240 --> 00:20:46,840
Speaker 2: What if all of a sudden, you're housing is a

450
00:20:46,920 --> 00:20:50,880
Speaker 2: much much larger percentage of your overall budget. Ooh okay, well,

451
00:20:51,000 --> 00:20:52,680
Speaker 2: maybe it would have been better to have started out

452
00:20:52,720 --> 00:20:54,960
Speaker 2: closer to the fifteen to twenty percent. You know, somebody's

453
00:20:55,000 --> 00:20:57,600
Speaker 2: looking to really keep things lean and to set themselves

454
00:20:57,640 --> 00:21:00,040
Speaker 2: up with all the options down the road. Okay, you

455
00:21:00,119 --> 00:21:02,160
Speaker 2: end up losing one of the two incomes that you're

456
00:21:02,160 --> 00:21:03,959
Speaker 2: counting on as a household, and all of a sudden

457
00:21:04,280 --> 00:21:06,840
Speaker 2: you shoot from you know, let's say you were more

458
00:21:06,880 --> 00:21:09,040
Speaker 2: on the conservative side and you're at fifteen percent of

459
00:21:09,080 --> 00:21:12,919
Speaker 2: overall take home and now, okay, it jumped from fifteen

460
00:21:13,000 --> 00:21:15,760
Speaker 2: to twenty eight percent. That's not a deal breaker, right,

461
00:21:15,800 --> 00:21:18,400
Speaker 2: as opposed to having shot for all right, we're gonna

462
00:21:18,400 --> 00:21:20,360
Speaker 2: push the envelope a little bit. This is like over

463
00:21:20,400 --> 00:21:22,080
Speaker 2: a third of our take on. This is like thirty

464
00:21:22,200 --> 00:21:25,320
Speaker 2: seven percent of our take home. Someone loses a job

465
00:21:25,359 --> 00:21:26,679
Speaker 2: and all of a sudden that shoots up to like

466
00:21:26,800 --> 00:21:29,760
Speaker 2: fifty two percent of your overall take home. That's the

467
00:21:29,840 --> 00:21:31,560
Speaker 2: kind of position that would put somebody in a really

468
00:21:31,560 --> 00:21:33,880
Speaker 2: tight spot. And Bailey, I would certainly hate to see

469
00:21:33,920 --> 00:21:36,440
Speaker 2: you there. I don't think that's the where he's gonna

470
00:21:36,520 --> 00:21:38,120
Speaker 2: end up. Agreed. I think for a lot of how

471
00:21:38,200 --> 00:21:40,719
Speaker 2: money listeners, it's honestly pushing them more into the direction

472
00:21:40,800 --> 00:21:44,240
Speaker 2: of maybe taking more risks. I don't want encourage folks

473
00:21:44,280 --> 00:21:45,680
Speaker 2: to do that, but I think we've got a lot

474
00:21:45,720 --> 00:21:49,960
Speaker 2: of very smart, financially savvy listeners. I have always bad.

475
00:21:49,800 --> 00:21:52,199
Speaker 1: I think you and I have you housing a little differently,

476
00:21:52,280 --> 00:21:54,199
Speaker 1: and I think that's partly because you're more willing to

477
00:21:54,200 --> 00:21:56,000
Speaker 1: cut back in some other areas of your life and

478
00:21:56,040 --> 00:21:58,840
Speaker 1: spend more on housing. And I just think, like that's

479
00:21:58,920 --> 00:22:01,320
Speaker 1: just a way in w which you and I differ,

480
00:22:01,960 --> 00:22:04,960
Speaker 1: But that's that's totally cool. Like you guys have remained

481
00:22:04,960 --> 00:22:07,120
Speaker 1: one car. I really like having my second car, even

482
00:22:07,119 --> 00:22:09,679
Speaker 1: though it's even though it's old, it's sweet, but but

483
00:22:09,800 --> 00:22:12,880
Speaker 1: I love I love the idea for me like housing

484
00:22:12,920 --> 00:22:15,879
Speaker 1: and transportation. My viewpoint has always been if I can

485
00:22:15,960 --> 00:22:20,440
Speaker 1: keep those incredibly reasonable to where there it wouldn't be painful,

486
00:22:20,520 --> 00:22:23,360
Speaker 1: right if something significant happened to us trying to cover

487
00:22:23,440 --> 00:22:26,240
Speaker 1: that monthly mortgage or something, wouldn't be a worry. And

488
00:22:26,280 --> 00:22:29,800
Speaker 1: maybe that's just my overly conservative nature, but I I

489
00:22:30,200 --> 00:22:32,919
Speaker 1: love living life like that to where I just I

490
00:22:33,040 --> 00:22:35,399
Speaker 1: know it's never going to be burden some because of

491
00:22:35,400 --> 00:22:36,919
Speaker 1: the way I've set my life up and because of

492
00:22:36,960 --> 00:22:41,159
Speaker 1: what a minimal percentage right of my income is dedicated

493
00:22:41,400 --> 00:22:44,720
Speaker 1: towards housing costs, Like it's not insignificant, but it's far

494
00:22:44,800 --> 00:22:48,440
Speaker 1: less significant than I think most people would assume you should.

495
00:22:48,160 --> 00:22:50,720
Speaker 2: Be I should have bitten off. That's right, Hey, we

496
00:22:50,760 --> 00:22:54,120
Speaker 2: got more to get to. We're gonna take questions about Airbnb.

497
00:22:54,240 --> 00:22:56,800
Speaker 2: We're gonna talk about boats not in the same question.

498
00:22:56,840 --> 00:22:58,480
Speaker 2: We'll get to all that and more right after this.

499
00:23:06,320 --> 00:23:07,080
Speaker 2: All right, we're back.

500
00:23:07,160 --> 00:23:09,919
Speaker 1: Look forward to taking that question about making money on

501
00:23:10,000 --> 00:23:12,560
Speaker 1: the World Cup in just a sec But let's take

502
00:23:12,640 --> 00:23:15,440
Speaker 1: a kind of generic retirement account question real quick.

503
00:23:15,480 --> 00:23:19,120
Speaker 4: Matt, Hey, Joel, Matt, this is Charlotte from North Carolina. Now,

504
00:23:19,119 --> 00:23:23,360
Speaker 4: I was wondering if you guys could talk about retirement rollovers,

505
00:23:23,680 --> 00:23:28,800
Speaker 4: the penalties, benefits, anything like that, just the basics about

506
00:23:29,440 --> 00:23:31,240
Speaker 4: retirement account rollovers.

507
00:23:31,480 --> 00:23:35,720
Speaker 2: Thanks rollovers, Joel. Let's get to it, man, Charlotte, thanks

508
00:23:35,720 --> 00:23:38,840
Speaker 2: so much for sending this hour away. And the first

509
00:23:38,920 --> 00:23:41,240
Speaker 2: question is whether or not I think you should do

510
00:23:41,320 --> 00:23:44,800
Speaker 2: a rollover from your retirement account. Your retirement account, so

511
00:23:44,960 --> 00:23:48,440
Speaker 2: your four one K into an IRA. But the devil

512
00:23:48,520 --> 00:23:50,240
Speaker 2: is in the details, and we'll get to that here

513
00:23:50,240 --> 00:23:52,760
Speaker 2: in a second. It's also important to mention that you

514
00:23:52,920 --> 00:23:55,760
Speaker 2: likely won't be able to roll over from your workplace

515
00:23:55,800 --> 00:23:59,480
Speaker 2: retirement account if you are still contributing to it. It

516
00:23:59,520 --> 00:24:03,560
Speaker 2: is possible if your employer's plan makes an in service

517
00:24:03,720 --> 00:24:06,800
Speaker 2: rollover exception, but you do need to know the details

518
00:24:06,880 --> 00:24:09,320
Speaker 2: of your plan and even as well, I'll say, even

519
00:24:09,320 --> 00:24:12,280
Speaker 2: aside from that I'm thinking about, I was considering you

520
00:24:12,280 --> 00:24:16,960
Speaker 2: remember back when Robin Hood was offering the match on rollovers.

521
00:24:16,960 --> 00:24:19,640
Speaker 2: Oh well, if that's something I looked into, because I'm like, man,

522
00:24:19,680 --> 00:24:22,000
Speaker 2: that's a I think it was like three percent, and

523
00:24:22,040 --> 00:24:27,240
Speaker 2: so it wasn't nothing. But because our current four one

524
00:24:27,280 --> 00:24:30,840
Speaker 2: K our solo four one K was still active, they're like, nah,

525
00:24:31,520 --> 00:24:34,040
Speaker 2: it's not because we are the managers of our plan. Yeah,

526
00:24:34,040 --> 00:24:36,720
Speaker 2: And so I would, as a manager of our plangel

527
00:24:36,760 --> 00:24:39,720
Speaker 2: say yeah, that's totally fine. I allow for that. But

528
00:24:39,960 --> 00:24:43,359
Speaker 2: even still Fidelity and Robinhood were like, no, we're not

529
00:24:43,359 --> 00:24:45,439
Speaker 2: gonna lie. Even though you said that's okay, we're not

530
00:24:45,480 --> 00:24:46,440
Speaker 2: gonna do that. Yeah.

531
00:24:46,480 --> 00:24:48,119
Speaker 1: So there are just all sorts of like in the

532
00:24:48,119 --> 00:24:51,119
Speaker 1: weed stipulations, and part of it is is planned to plan,

533
00:24:51,640 --> 00:24:54,280
Speaker 1: and so yeah, if you are still currently in this plan,

534
00:24:54,480 --> 00:24:56,640
Speaker 1: it's unlikely right that you're gonna be able to.

535
00:24:56,560 --> 00:24:57,720
Speaker 2: Pull off a rollover.

536
00:24:58,320 --> 00:25:00,439
Speaker 1: The main reason to get out of your current retirement

537
00:25:00,480 --> 00:25:03,080
Speaker 1: account and to pursue a rollover though, would be if

538
00:25:03,119 --> 00:25:05,480
Speaker 1: the fees were too high or we're going to talk

539
00:25:05,520 --> 00:25:08,480
Speaker 1: about this too. If your old four one case fees

540
00:25:08,480 --> 00:25:11,560
Speaker 1: are too high, and so that largely depends on the

541
00:25:11,600 --> 00:25:14,879
Speaker 1: brokerage that your employer uses. If they're using one of

542
00:25:14,920 --> 00:25:17,400
Speaker 1: our low coast favorites, you're probably fine, right, No need

543
00:25:17,440 --> 00:25:20,240
Speaker 1: to make a change, no need to try to get

544
00:25:20,240 --> 00:25:22,320
Speaker 1: out of there as quickly as possible and migrate into

545
00:25:22,359 --> 00:25:26,159
Speaker 1: your own IRA. So if fees are reasonable on index

546
00:25:26,200 --> 00:25:28,639
Speaker 1: funds or target date funds, like fees might be unreasonable

547
00:25:28,640 --> 00:25:31,760
Speaker 1: on a bunch of other investment vehicles that your employer offers,

548
00:25:31,960 --> 00:25:35,159
Speaker 1: but if they're at least reasonable on the funds that

549
00:25:35,320 --> 00:25:38,200
Speaker 1: you want to choose, right, then stay put.

550
00:25:38,560 --> 00:25:40,520
Speaker 2: Right. If I would say.

551
00:25:40,440 --> 00:25:42,720
Speaker 1: What is reasonable, that's kind of hard to define us

552
00:25:42,720 --> 00:25:45,199
Speaker 1: a little nebulous. But if you can get access to

553
00:25:45,280 --> 00:25:47,760
Speaker 1: funds that are widely diversified that makes sense for you,

554
00:25:47,800 --> 00:25:50,359
Speaker 1: that are below point two percent expense ratio, then I

555
00:25:50,359 --> 00:25:53,080
Speaker 1: would say there's no need to stress yourself out and

556
00:25:53,160 --> 00:25:56,160
Speaker 1: try to get out of there. And so, typically when

557
00:25:56,200 --> 00:25:58,479
Speaker 1: folks are talking about doing a rollover, though it's from

558
00:25:58,520 --> 00:26:00,720
Speaker 1: a plan they had with a former lawyer, that's most

559
00:26:00,720 --> 00:26:02,480
Speaker 1: of the time what we're talking about. So, Charlotte, I'm

560
00:26:02,480 --> 00:26:05,159
Speaker 1: not sure you didn't mention if you had a four

561
00:26:05,240 --> 00:26:07,960
Speaker 1: ROH one K that you are holding on to. It's got,

562
00:26:08,080 --> 00:26:10,440
Speaker 1: you know, maybe a significant amount of money from a

563
00:26:10,560 --> 00:26:12,760
Speaker 1: job you used to have. If that's the case and

564
00:26:12,760 --> 00:26:15,840
Speaker 1: the fees are high in that plan, there's just almost

565
00:26:15,880 --> 00:26:18,360
Speaker 1: no reason not to perform a rollover, right in order

566
00:26:18,359 --> 00:26:22,000
Speaker 1: to give yourself better investment choices. And it just also

567
00:26:22,040 --> 00:26:25,000
Speaker 1: gives you the chance to consolidate and potentially have all

568
00:26:25,040 --> 00:26:27,920
Speaker 1: your accounts under one log in with a great low

569
00:26:27,920 --> 00:26:31,480
Speaker 1: cost company, which just from a behavioral and monitoring standpoint,

570
00:26:31,560 --> 00:26:33,119
Speaker 1: is just nice for a lot of people to be like, oh,

571
00:26:33,240 --> 00:26:37,320
Speaker 1: all my money or it's all even if it's in

572
00:26:37,359 --> 00:26:40,440
Speaker 1: a couple of different vehicles, a couple of different accounts,

573
00:26:40,480 --> 00:26:43,639
Speaker 1: it's all with one company. I can log in, I

574
00:26:43,640 --> 00:26:44,760
Speaker 1: can see it all in one place.

575
00:26:45,960 --> 00:26:48,480
Speaker 2: That's one login to rule them all, which is nice

576
00:26:48,480 --> 00:26:49,600
Speaker 2: than what you're avocating for here.

577
00:26:49,640 --> 00:26:51,520
Speaker 1: You can kind of get that through a monitoring service. Right,

578
00:26:51,560 --> 00:26:55,520
Speaker 1: Let's say you sign up for Monarch. You can see

579
00:26:55,520 --> 00:26:57,640
Speaker 1: all your accounts in one place there. So that's nice.

580
00:26:57,640 --> 00:26:59,120
Speaker 1: But still, I think for a lot of people from

581
00:26:59,119 --> 00:27:02,840
Speaker 1: a behavioral perspective, it's they enjoy saying oh, everything's the vanguard,

582
00:27:02,880 --> 00:27:04,359
Speaker 1: everything's with fidelity or everything's with.

583
00:27:04,400 --> 00:27:07,080
Speaker 2: Schwap, yeah, or is it nice to have them all

584
00:27:07,119 --> 00:27:08,760
Speaker 2: spread out that way you don't feel richer than you

585
00:27:08,800 --> 00:27:11,679
Speaker 2: are and end up spending perhaps more than you want to.

586
00:27:11,960 --> 00:27:15,120
Speaker 2: But while we're talking about rollovers, it's important to go

587
00:27:15,200 --> 00:27:19,320
Speaker 2: for that trustee to trustee transfer because what so, that's

588
00:27:19,320 --> 00:27:23,320
Speaker 2: called a direct rollover, And basically you don't want to

589
00:27:23,359 --> 00:27:25,560
Speaker 2: check mail to you because the clock is ticking once

590
00:27:25,600 --> 00:27:28,040
Speaker 2: you initiate the process, and if you fail to get

591
00:27:28,040 --> 00:27:31,359
Speaker 2: that money into your new account on time, you have

592
00:27:31,680 --> 00:27:38,000
Speaker 2: officially initiated a significant taxable event, and unplanned taxable events

593
00:27:38,240 --> 00:27:41,920
Speaker 2: aren't how you build wealth. This is something you can

594
00:27:41,960 --> 00:27:44,560
Speaker 2: do yourself for sure. That being said, we are fans

595
00:27:44,600 --> 00:27:47,320
Speaker 2: of a company called Capitalize, which will help you to

596
00:27:47,560 --> 00:27:51,399
Speaker 2: execute a rollover flawlessly for free. This is something that

597
00:27:51,640 --> 00:27:54,600
Speaker 2: you participated in many like you went with Capitalized many

598
00:27:54,600 --> 00:27:55,960
Speaker 2: many years, right. Yeah.

599
00:27:56,000 --> 00:27:59,800
Speaker 1: It was with my wife's old workplace retirement account and

600
00:28:00,600 --> 00:28:04,400
Speaker 1: they were even she was with such a small company

601
00:28:04,560 --> 00:28:07,920
Speaker 1: that I couldn't even do everything through their automated website.

602
00:28:07,960 --> 00:28:10,720
Speaker 1: I had to actually call a human at Capitalized. But

603
00:28:10,760 --> 00:28:13,639
Speaker 1: they were so nice and helpful and they made it

604
00:28:13,720 --> 00:28:15,600
Speaker 1: like Is it something I could have done myself?

605
00:28:15,720 --> 00:28:18,879
Speaker 2: Yes? Was it easier because Capitalized helped me? Also?

606
00:28:18,920 --> 00:28:20,280
Speaker 1: Yes, it could have held your hand along that it

607
00:28:20,320 --> 00:28:21,960
Speaker 1: didn't cost me a dime, which is nice as well.

608
00:28:22,000 --> 00:28:22,600
Speaker 2: So it's nice.

609
00:28:22,640 --> 00:28:24,680
Speaker 1: Well, we'll put a link to our review of Capitalized

610
00:28:24,760 --> 00:28:26,679
Speaker 1: up in the show notes. But if you're like I

611
00:28:26,680 --> 00:28:28,000
Speaker 1: think I do have an old four on and K

612
00:28:28,080 --> 00:28:30,320
Speaker 1: it's been lingering around. Yeah, I probably am paying too much.

613
00:28:30,600 --> 00:28:32,960
Speaker 1: Maybe I should clean up that part of my financial life.

614
00:28:33,119 --> 00:28:36,080
Speaker 1: Capitalized is an awesome company who can help you do

615
00:28:36,160 --> 00:28:39,640
Speaker 1: that for free. They'll make it a lot easier than

616
00:28:39,680 --> 00:28:41,960
Speaker 1: it would be less less painless than you.

617
00:28:41,920 --> 00:28:43,760
Speaker 2: Trying to go it alone. Yes, right, Yeah.

618
00:28:43,920 --> 00:28:45,720
Speaker 1: A couple of other things too that you're going to want

619
00:28:45,720 --> 00:28:50,640
Speaker 1: to consider before doing a rollover. Is I mean, hey,

620
00:28:50,720 --> 00:28:53,640
Speaker 1: four O one k's. They're actually more impervious to lawsuits

621
00:28:53,800 --> 00:28:58,120
Speaker 1: like that money is essentially impossible to get if you're

622
00:28:58,160 --> 00:29:01,520
Speaker 1: sued and found liable, where your IRA money past a

623
00:29:01,560 --> 00:29:06,040
Speaker 1: certain point is more easily accessible, So there's that. There's

624
00:29:06,080 --> 00:29:08,120
Speaker 1: also something known as the rule of fifty five, which

625
00:29:08,120 --> 00:29:11,240
Speaker 1: makes it easier to draw down funds without tax consequence

626
00:29:11,240 --> 00:29:14,600
Speaker 1: at an earlier age that you lose when you turn

627
00:29:14,640 --> 00:29:17,720
Speaker 1: four one K dollars into IRA dollars. Those don't affect

628
00:29:17,760 --> 00:29:19,560
Speaker 1: too many folks. I think one other thing that's worth

629
00:29:19,600 --> 00:29:22,200
Speaker 1: mentioning is that it can be hard. It can become

630
00:29:22,240 --> 00:29:25,120
Speaker 1: harder to do a backdoor roth IRA in the future

631
00:29:25,160 --> 00:29:27,320
Speaker 1: because of the pro rat or rule as well. So

632
00:29:27,400 --> 00:29:32,400
Speaker 1: there are just another smaller things, not huge, major things

633
00:29:32,680 --> 00:29:34,720
Speaker 1: that can impact whether you decided to do a rollover

634
00:29:34,800 --> 00:29:35,280
Speaker 1: or not as well.

635
00:29:35,440 --> 00:29:39,120
Speaker 2: That's that's true, and those do impact almost everyone out there.

636
00:29:39,240 --> 00:29:41,880
Speaker 2: I want to mention something that might impact I think

637
00:29:41,920 --> 00:29:43,720
Speaker 2: fewer folks out there, but the impact that it could

638
00:29:43,720 --> 00:29:47,600
Speaker 2: have on them could be incredibly significant, and that being

639
00:29:47,800 --> 00:29:52,760
Speaker 2: something that's called the net unrealized appreciation. And basically this

640
00:29:52,800 --> 00:29:55,520
Speaker 2: is a specialized tax strategy that allows you to essentially

641
00:29:55,560 --> 00:29:58,320
Speaker 2: rescue company stock from your four oh one K so

642
00:29:58,400 --> 00:30:02,520
Speaker 2: that it's growth is taxed at lower long term capital

643
00:30:02,560 --> 00:30:05,920
Speaker 2: gains rates of so anywhere between zero and twenty percent,

644
00:30:06,360 --> 00:30:10,240
Speaker 2: rather than higher ordinary income tax rates, say up to

645
00:30:10,400 --> 00:30:13,600
Speaker 2: thirty seven percent. So, and this isn't something that you

646
00:30:13,680 --> 00:30:15,840
Speaker 2: asked about, Charlotte, but when you move these shares directly

647
00:30:15,840 --> 00:30:19,480
Speaker 2: into a taxable brokerage account, you only pay ordinary income

648
00:30:19,520 --> 00:30:22,240
Speaker 2: tax on the original price that you paid for that stock,

649
00:30:22,800 --> 00:30:27,280
Speaker 2: So the basis, while the potentially massive mountain of growth

650
00:30:27,760 --> 00:30:30,600
Speaker 2: remains tax deferred until you actually sell the share. So

651
00:30:30,600 --> 00:30:32,280
Speaker 2: so this might be a reason that you want to

652
00:30:32,360 --> 00:30:35,240
Speaker 2: keep an old four to win k around, specifically to

653
00:30:35,320 --> 00:30:37,000
Speaker 2: keep this as an option for you, because as soon

654
00:30:37,000 --> 00:30:39,240
Speaker 2: as you roll that company's stock into a new four

655
00:30:39,320 --> 00:30:43,479
Speaker 2: one K or an IRA, that's net unrealized appreciation, so

656
00:30:43,520 --> 00:30:47,320
Speaker 2: that NUA that eligibility is completely gone, which would then

657
00:30:47,360 --> 00:30:49,880
Speaker 2: potentially cause you to have to pay a ton of

658
00:30:49,920 --> 00:30:53,560
Speaker 2: money in tax payments. And that's assuming that the stock

659
00:30:53,600 --> 00:30:57,000
Speaker 2: has significantly appreciated. And I mentioned this because I think

660
00:30:57,040 --> 00:31:00,200
Speaker 2: more folks I've been shocked because normally we say when

661
00:31:00,200 --> 00:31:03,120
Speaker 2: we talk about company stock being an option for folks

662
00:31:03,160 --> 00:31:05,040
Speaker 2: that like, oh get that you don't really want to

663
00:31:05,040 --> 00:31:07,160
Speaker 2: put all your eggs in one basket, don't. The more

664
00:31:07,200 --> 00:31:08,959
Speaker 2: people I talk to, I am surprised that how many

665
00:31:09,000 --> 00:31:11,520
Speaker 2: people own their company in their four one k's. And

666
00:31:11,560 --> 00:31:12,920
Speaker 2: I don't know what's going on, man, Like, I don't

667
00:31:12,960 --> 00:31:15,920
Speaker 2: know if it's like this do it for the team,

668
00:31:15,960 --> 00:31:19,440
Speaker 2: if there's like this unspoken pressure like from HR or

669
00:31:19,920 --> 00:31:22,600
Speaker 2: rallying cry. Yes. But the more people I talk to you,

670
00:31:22,600 --> 00:31:23,880
Speaker 2: they're like, oh, yeah, I've got a bunch of my

671
00:31:23,920 --> 00:31:27,560
Speaker 2: company stock in our formal K, which it really surprises me.

672
00:31:27,600 --> 00:31:29,880
Speaker 2: So I don't know, maybe if there's something I don't know,

673
00:31:30,000 --> 00:31:32,640
Speaker 2: since we work for ourselves role and we're not like

674
00:31:32,720 --> 00:31:35,480
Speaker 2: these these kind of corporate tech guys, we might be

675
00:31:35,480 --> 00:31:37,040
Speaker 2: out of the loop here, So reach out to us,

676
00:31:37,040 --> 00:31:39,640
Speaker 2: fill us in if that's something that we're not aware of.

677
00:31:39,680 --> 00:31:42,680
Speaker 2: But basically, when you keep that four one k alive,

678
00:31:42,800 --> 00:31:46,600
Speaker 2: like those shares of that stock are still considered company shares, right,

679
00:31:47,000 --> 00:31:48,719
Speaker 2: but if you're trying to move that to another four

680
00:31:48,760 --> 00:31:50,040
Speaker 2: and k, well, all of a sudden, those are just

681
00:31:50,120 --> 00:31:54,000
Speaker 2: normal ordinary stock shares, so they are no longer immune

682
00:31:54,560 --> 00:31:58,040
Speaker 2: to tax at that point. So it's it's really fascinating,

683
00:31:58,080 --> 00:32:00,800
Speaker 2: and it's a great argument for moving it to a

684
00:32:00,920 --> 00:32:04,760
Speaker 2: brokerage taxile brokerage account or I think the better option,

685
00:32:04,840 --> 00:32:07,200
Speaker 2: most likely is just to keep it there at the

686
00:32:08,040 --> 00:32:11,240
Speaker 2: existing four one k so that you have that option

687
00:32:11,280 --> 00:32:12,960
Speaker 2: down the road. And probably the best option is just

688
00:32:13,000 --> 00:32:16,520
Speaker 2: to not buy company stock in any form or fashion

689
00:32:16,680 --> 00:32:19,000
Speaker 2: for the company you work for, because, like you said,

690
00:32:19,080 --> 00:32:21,640
Speaker 2: you are just creating more risk in your life than

691
00:32:21,720 --> 00:32:24,680
Speaker 2: is necessary. You're already your income is are already dependent

692
00:32:24,800 --> 00:32:28,000
Speaker 2: on that single company, So don't own stock of that

693
00:32:28,040 --> 00:32:31,920
Speaker 2: company unless we're talking about an ESPP, which is topic

694
00:32:31,920 --> 00:32:34,280
Speaker 2: for another day. But I just really quickly, we've been

695
00:32:34,280 --> 00:32:36,720
Speaker 2: talking about rollovers. One of to briefly mentioned conversions, which

696
00:32:36,760 --> 00:32:41,280
Speaker 2: were different if you conversion is essentially turning those traditional

697
00:32:41,320 --> 00:32:44,040
Speaker 2: dollars into row dollars, which can make sense for some

698
00:32:44,080 --> 00:32:46,240
Speaker 2: folks who want to pay tax now in order to

699
00:32:46,600 --> 00:32:50,640
Speaker 2: reduce future tax obligations. I don't know if that's what

700
00:32:50,920 --> 00:32:53,440
Speaker 2: Charlotte is looking for either, but that's something you want

701
00:32:53,480 --> 00:32:56,960
Speaker 2: to do really carefully, potentially with the help of an expert,

702
00:32:57,240 --> 00:33:01,600
Speaker 2: because there's a lot of taxation at stake. Yea And yeah,

703
00:33:01,600 --> 00:33:04,040
Speaker 2: that's what you can read up on roth conversion ladders

704
00:33:04,040 --> 00:33:06,760
Speaker 2: and stuff like that. But hopefully that helps at least

705
00:33:06,920 --> 00:33:09,680
Speaker 2: Charlotte you understand how rollovers work and whether or not

706
00:33:09,720 --> 00:33:12,080
Speaker 2: it might make sense for you. That's right, the potential

707
00:33:12,120 --> 00:33:15,280
Speaker 2: tax implications specifically. All right, Joe, let's hear from another

708
00:33:15,320 --> 00:33:18,480
Speaker 2: listener who actually he is new to the show.

709
00:33:19,160 --> 00:33:22,000
Speaker 5: Hey, guys, my name is Bill Tall. I'm a brand

710
00:33:22,000 --> 00:33:26,120
Speaker 5: new listener to your podcast, really appreciate what I'm hearing

711
00:33:26,160 --> 00:33:29,480
Speaker 5: so far. I'm from Chesapeake, Virginia, and i have a

712
00:33:29,560 --> 00:33:32,440
Speaker 5: question for both of you. Hopefully you can help me

713
00:33:32,520 --> 00:33:35,520
Speaker 5: navigate it. I'm a little later in life. I've already

714
00:33:35,520 --> 00:33:39,600
Speaker 5: retired from one job, have started a new job, and

715
00:33:39,680 --> 00:33:44,480
Speaker 5: making pretty good money. I currently have a boat debt

716
00:33:44,840 --> 00:33:50,240
Speaker 5: that I've had since twenty twenty one, and interest rates

717
00:33:50,320 --> 00:33:54,440
Speaker 5: kind of high, and I owe about thirty thousand dollars

718
00:33:54,440 --> 00:33:59,440
Speaker 5: on this watercraft. I've been paying payments on it, but

719
00:34:01,040 --> 00:34:03,440
Speaker 5: based on interest, I'm not really making a big dent

720
00:34:03,560 --> 00:34:08,120
Speaker 5: in it. I'm torn between pulling money out of savings

721
00:34:08,160 --> 00:34:11,600
Speaker 5: to just pay the debt off in one fell swoop

722
00:34:11,840 --> 00:34:15,560
Speaker 5: because I really don't want the monthly payment. Can you

723
00:34:15,560 --> 00:34:18,760
Speaker 5: give me some strategies. I have a pretty robust savings,

724
00:34:19,600 --> 00:34:23,160
Speaker 5: I have other investments, but I'm not interested in depleting

725
00:34:23,200 --> 00:34:27,640
Speaker 5: those in order to pay this down more quickly. Any

726
00:34:27,680 --> 00:34:29,880
Speaker 5: suggestions you might have, I'd greatly appreciate.

727
00:34:30,800 --> 00:34:31,040
Speaker 2: Bill.

728
00:34:31,080 --> 00:34:33,080
Speaker 1: Glad to have you on board as a new listener.

729
00:34:33,800 --> 00:34:36,840
Speaker 1: I was gonna use some It's gonna tell them to

730
00:34:36,840 --> 00:34:39,919
Speaker 1: swap the deck, Matt, but I don't know if that's ut.

731
00:34:40,000 --> 00:34:43,120
Speaker 1: I felt you going, yes, sorry, okay, but dad puns

732
00:34:43,120 --> 00:34:43,799
Speaker 1: are strong with me.

733
00:34:43,840 --> 00:34:46,120
Speaker 2: Before I don't I don't think you were planning to

734
00:34:46,120 --> 00:34:48,080
Speaker 2: talk about this before we even start talking about the

735
00:34:48,080 --> 00:34:50,120
Speaker 2: boat and the debt and whatnot. I just noticed that

736
00:34:50,160 --> 00:34:53,120
Speaker 2: he mentioned how he had already retired once from one

737
00:34:53,239 --> 00:34:56,960
Speaker 2: job and how he's got a new job, which is awesome, Bill.

738
00:34:57,080 --> 00:35:01,480
Speaker 2: I love that. It seems like you shifted gear and esssion,

739
00:35:01,920 --> 00:35:04,280
Speaker 2: there's like another boat joke in there, the other gears

740
00:35:04,280 --> 00:35:06,279
Speaker 2: and with boats. I mean, that's whe we're going right now.

741
00:35:07,320 --> 00:35:09,560
Speaker 2: But it seems like he's taking more of a gradual

742
00:35:09,600 --> 00:35:13,120
Speaker 2: approach to retirement. So I don't know. I'm just assuming

743
00:35:13,360 --> 00:35:15,960
Speaker 2: that he quit something that was maybe higher paying but

744
00:35:16,040 --> 00:35:19,240
Speaker 2: also higher demanding, and maybe he's doing something that allows

745
00:35:19,280 --> 00:35:21,680
Speaker 2: him to have a little more time doing something like

746
00:35:21,719 --> 00:35:24,359
Speaker 2: boating around enjoying some of his free time. So I

747
00:35:24,400 --> 00:35:26,480
Speaker 2: just love that approach to retirement, the fact that he

748
00:35:26,520 --> 00:35:29,399
Speaker 2: said I already retired. Now I've got this other gig,

749
00:35:29,560 --> 00:35:31,640
Speaker 2: that this other you know, side job that it's paying

750
00:35:31,680 --> 00:35:33,640
Speaker 2: him well too. Yeah, exactly, it's not even a side job.

751
00:35:33,640 --> 00:35:35,160
Speaker 2: It's not like he's driving for Uber or something. Like

752
00:35:35,160 --> 00:35:37,839
Speaker 2: that this is something that works by choice.

753
00:35:37,840 --> 00:35:40,239
Speaker 1: It sounds like, yeah, he doesn't have to, but he's

754
00:35:40,280 --> 00:35:43,120
Speaker 1: choosing to. But okay, let's talk about the boat, because

755
00:35:43,120 --> 00:35:46,799
Speaker 1: this is ultimately why we're against financing depreciating assets, right,

756
00:35:46,960 --> 00:35:50,880
Speaker 1: especially non necessities. Financing a car is ill advised, but

757
00:35:50,960 --> 00:35:53,840
Speaker 1: financing a boat or an RV is something we're even

758
00:35:53,920 --> 00:35:56,959
Speaker 1: less keen on. We just don't want people to do it. Bill,

759
00:35:57,000 --> 00:35:58,960
Speaker 1: you purchased his boat five years ago and you still

760
00:35:58,960 --> 00:36:01,279
Speaker 1: have thirty thousand bucks on it. I know boats can

761
00:36:01,320 --> 00:36:03,719
Speaker 1: be incredibly expensive. I kind of looked into it, Matt,

762
00:36:03,719 --> 00:36:05,799
Speaker 1: and I was like, oh, maybe it sounds like it

763
00:36:05,800 --> 00:36:07,919
Speaker 1: was an expensive boat. And then I did a little

764
00:36:07,960 --> 00:36:10,600
Speaker 1: bit number crunching and I was like, actually, probably wasn't

765
00:36:10,600 --> 00:36:13,000
Speaker 1: that expensive. But both like, boats can get really crazy

766
00:36:13,040 --> 00:36:16,120
Speaker 1: expensive really quickly. So it's obviously he didn't buy a

767
00:36:16,160 --> 00:36:19,359
Speaker 1: fancy yacht or anything like that, but that's still quite

768
00:36:19,360 --> 00:36:21,920
Speaker 1: a balance to have after paying for half a decade,

769
00:36:22,640 --> 00:36:24,640
Speaker 1: you didn't actually stay what the interest rate was, or

770
00:36:24,640 --> 00:36:26,920
Speaker 1: how much you have in savings beyond the payoff amount.

771
00:36:27,239 --> 00:36:30,040
Speaker 1: Those are key items that would help us deliver I

772
00:36:30,120 --> 00:36:34,479
Speaker 1: think more specific advice, but getting rid of this boat

773
00:36:34,520 --> 00:36:36,760
Speaker 1: debt is I think a very high priority totally.

774
00:36:36,840 --> 00:36:38,839
Speaker 2: Yeah, we also don't know what other debts he has,

775
00:36:39,080 --> 00:36:41,600
Speaker 2: so he didn't share that as well. But we'll still

776
00:36:41,640 --> 00:36:43,239
Speaker 2: do our best here. So first off, I don't want

777
00:36:43,239 --> 00:36:45,440
Speaker 2: you to zero out your savings completely, and it doesn't

778
00:36:45,440 --> 00:36:47,400
Speaker 2: sound like you want to do that either, But let's

779
00:36:47,400 --> 00:36:50,560
Speaker 2: just say, Okay, so you owe thirty thousand dollars, let's

780
00:36:50,560 --> 00:36:53,839
Speaker 2: say you've got thirty thousand in savings. Well, I think

781
00:36:53,880 --> 00:36:55,840
Speaker 2: it would be highly unwise to pay off the balance

782
00:36:55,840 --> 00:36:58,600
Speaker 2: and then leave yourself completely exposed to any sort of

783
00:36:58,760 --> 00:37:02,279
Speaker 2: financial emergency could come along. But still, I understand that

784
00:37:02,320 --> 00:37:05,320
Speaker 2: it's hard to ignore the emotional reality of feeling stuck

785
00:37:05,360 --> 00:37:08,560
Speaker 2: with a big payment for potentially many many more years,

786
00:37:08,960 --> 00:37:12,160
Speaker 2: and the mathematical reality, honestly, of your interest rate being

787
00:37:12,200 --> 00:37:15,720
Speaker 2: far worse than what your savings can earn. That's something

788
00:37:15,800 --> 00:37:18,120
Speaker 2: you have to wrestle with as well. I'm not sure

789
00:37:18,160 --> 00:37:19,840
Speaker 2: of the gap, but I mean we could be talking

790
00:37:19,880 --> 00:37:24,839
Speaker 2: about like a twelve percent interest rate on this boat loan,

791
00:37:25,400 --> 00:37:27,920
Speaker 2: and you know, three four percent easily on your savings.

792
00:37:27,960 --> 00:37:31,680
Speaker 2: So there's that mathematical what do the numbers say reality

793
00:37:31,760 --> 00:37:34,040
Speaker 2: as well, that might be causing him to want to

794
00:37:34,520 --> 00:37:37,360
Speaker 2: jump ship man overboard.

795
00:37:37,440 --> 00:37:41,040
Speaker 1: Yeah, I mean, probably not as as bad as credit

796
00:37:41,080 --> 00:37:42,640
Speaker 1: card debt, is my guest, Like we don't know the

797
00:37:42,680 --> 00:37:46,920
Speaker 1: interest trade on this, but also not as insignificant or

798
00:37:47,680 --> 00:37:51,920
Speaker 1: not not nearly as harmful as a mortgage loan that

799
00:37:52,000 --> 00:37:54,520
Speaker 1: somebody took out six years ago, and guess is somewhere

800
00:37:54,520 --> 00:37:56,800
Speaker 1: in between thirty percent, right, Yeah, And so again we

801
00:37:56,840 --> 00:37:58,720
Speaker 1: don't know the interest rate, but if we're talking about

802
00:37:58,760 --> 00:38:02,160
Speaker 1: something at that level, the double digits lean towards reducing

803
00:38:02,239 --> 00:38:04,600
Speaker 1: savings to digit because if you can pay off the

804
00:38:04,640 --> 00:38:08,480
Speaker 1: boat in full and maintain a decent two month emergency fund,

805
00:38:08,480 --> 00:38:11,319
Speaker 1: even do it if you can't take as much as

806
00:38:11,360 --> 00:38:14,279
Speaker 1: your savings, I think, as you possibly can to throw

807
00:38:14,320 --> 00:38:17,000
Speaker 1: at the boat the boat debt while still leaving a

808
00:38:17,080 --> 00:38:20,040
Speaker 1: reasonable cushion, and then you can pay down the rest

809
00:38:20,080 --> 00:38:23,000
Speaker 1: of the balance after that. That way you're making meaningful

810
00:38:23,000 --> 00:38:25,960
Speaker 1: progress either way. If the interest rate on this boat

811
00:38:26,000 --> 00:38:28,319
Speaker 1: is closer to six or seven percent, you might just

812
00:38:28,320 --> 00:38:31,279
Speaker 1: want to be a touch more cautious. But I think

813
00:38:31,320 --> 00:38:33,640
Speaker 1: a good question to ask that you can shed some

814
00:38:33,760 --> 00:38:35,799
Speaker 1: light is, if I didn't already own this boat, would

815
00:38:35,800 --> 00:38:38,680
Speaker 1: I take out a loan at this rate today in

816
00:38:38,760 --> 00:38:40,759
Speaker 1: order to keep this cash on hand. If you think

817
00:38:40,760 --> 00:38:45,680
Speaker 1: in those terms while also avoiding a zero savings reality,

818
00:38:45,920 --> 00:38:49,480
Speaker 1: I think that can be clarifying totally. But he also said, hey,

819
00:38:49,640 --> 00:38:51,879
Speaker 1: I'm making good money in this job. I think if

820
00:38:51,880 --> 00:38:54,960
Speaker 1: he eliminates the majority of the savings while keeping some

821
00:38:55,040 --> 00:38:58,279
Speaker 1: intact to pay off the boat debt, he could probably

822
00:38:58,320 --> 00:39:00,160
Speaker 1: replenish that emergency savings fairlyquick.

823
00:39:00,239 --> 00:39:01,600
Speaker 2: Yeah, you can get serious about it. I like what

824
00:39:01,640 --> 00:39:04,279
Speaker 2: you said about, hey, would you get this boat now

825
00:39:04,360 --> 00:39:06,640
Speaker 2: given given the terms that you have, because essentially what

826
00:39:06,680 --> 00:39:10,120
Speaker 2: you're getting him to not continue to do is potentially

827
00:39:10,400 --> 00:39:14,040
Speaker 2: engaging in some cost fallacy, which is that, oh, this

828
00:39:14,120 --> 00:39:17,439
Speaker 2: thing isn't returning what I thought it would because of

829
00:39:17,480 --> 00:39:19,399
Speaker 2: the money of our I've already poured into it. I'm

830
00:39:19,400 --> 00:39:21,600
Speaker 2: going to keep going in that direction, right Like another

831
00:39:21,680 --> 00:39:23,640
Speaker 2: Like a classic example I feel like is, oh, I

832
00:39:23,680 --> 00:39:25,759
Speaker 2: spent a lot of money on these concert tickets. I'm

833
00:39:25,800 --> 00:39:28,759
Speaker 2: deathinitely ill, I'm terribly sick, and if I were to

834
00:39:28,760 --> 00:39:31,040
Speaker 2: go to the concert I would it would be a

835
00:39:31,040 --> 00:39:33,719
Speaker 2: miserable time. And but then you end up going because

836
00:39:33,719 --> 00:39:35,120
Speaker 2: you're like, but I spent so much money on the

837
00:39:35,160 --> 00:39:37,560
Speaker 2: concert tickets, and of course this and then you die

838
00:39:37,560 --> 00:39:41,760
Speaker 2: at the concert. This just assumes some magical concert ticket

839
00:39:41,760 --> 00:39:43,960
Speaker 2: that you can't sell for some reason either. But we

840
00:39:44,000 --> 00:39:46,640
Speaker 2: want to make sure that you're not keeping this thing

841
00:39:46,680 --> 00:39:48,719
Speaker 2: around because of what you've already sunk into it. You

842
00:39:48,760 --> 00:39:51,600
Speaker 2: need to not pay attention to that, because then you'd

843
00:39:51,640 --> 00:39:54,719
Speaker 2: be pouring more good money in after bad. And I

844
00:39:54,719 --> 00:39:57,200
Speaker 2: think it's worth asking in a similar way, asking the

845
00:39:57,280 --> 00:39:59,880
Speaker 2: question too, are you getting the kind of value out

846
00:39:59,880 --> 00:40:02,799
Speaker 2: of the boat just moving forward that you thought you

847
00:40:02,840 --> 00:40:04,239
Speaker 2: were right? Like there might be a part of you

848
00:40:04,280 --> 00:40:07,200
Speaker 2: that's saying, well, man, I got some great memories, we

849
00:40:07,200 --> 00:40:09,000
Speaker 2: had a great time. I think that's totally fine, and

850
00:40:09,040 --> 00:40:11,880
Speaker 2: you can remember those great times that you had, but

851
00:40:12,360 --> 00:40:16,880
Speaker 2: maybe it's not worth the additional expenses associated with the boat,

852
00:40:16,920 --> 00:40:19,480
Speaker 2: so like the slip fees, and maybe you have to

853
00:40:19,480 --> 00:40:22,479
Speaker 2: store it somewhere right like they are. I know somebody

854
00:40:22,560 --> 00:40:26,440
Speaker 2: Joel who gosh, can't even tell me directly how much

855
00:40:26,480 --> 00:40:30,040
Speaker 2: he spent it, but he the engine of the ski

856
00:40:30,080 --> 00:40:34,680
Speaker 2: boat seized up because they weren't checking the oil, and

857
00:40:34,800 --> 00:40:36,680
Speaker 2: I know he spent at least ten thousand dollars in

858
00:40:36,800 --> 00:40:38,840
Speaker 2: order to get this boat back up and run in

859
00:40:38,920 --> 00:40:40,440
Speaker 2: and so like, these are the kind of expenses that

860
00:40:40,480 --> 00:40:44,320
Speaker 2: could just man really throw a wrench in your personal finances.

861
00:40:44,400 --> 00:40:47,120
Speaker 1: So you kind of running through or a well, I

862
00:40:47,120 --> 00:40:49,000
Speaker 1: don't I don't want to hate on somebody. Some people

863
00:40:49,120 --> 00:40:52,000
Speaker 1: purposely spend on boats because like my my uncle loves

864
00:40:52,040 --> 00:40:52,319
Speaker 1: his boat.

865
00:40:52,360 --> 00:40:54,720
Speaker 2: If you love it, I am all for you continuing

866
00:40:54,719 --> 00:40:56,600
Speaker 2: to keep that thing around. I love that you love

867
00:40:56,640 --> 00:40:58,919
Speaker 2: that thing, but make sure that you love it enough.

868
00:40:58,960 --> 00:41:01,800
Speaker 2: I think on the on the front and rent one

869
00:41:02,080 --> 00:41:04,120
Speaker 2: for a whole summer. See how often you get out there.

870
00:41:04,280 --> 00:41:04,440
Speaker 3: Yea.

871
00:41:04,480 --> 00:41:05,960
Speaker 1: And then if you're like, this is oh this is

872
00:41:05,960 --> 00:41:09,040
Speaker 1: my jam for all the would be boaters out yes, yes, exactly.

873
00:41:09,520 --> 00:41:12,279
Speaker 1: Just it's I've known way too many people who are

874
00:41:12,280 --> 00:41:14,480
Speaker 1: just like that sounds like fun, let's go for it

875
00:41:14,520 --> 00:41:16,279
Speaker 1: with an RV and a boat. I feel like they're

876
00:41:16,360 --> 00:41:20,240
Speaker 1: very very similar type of purchases, kind of adventure vehicles.

877
00:41:20,239 --> 00:41:23,160
Speaker 1: Like it's you can envision yourself doing certain things, but

878
00:41:23,280 --> 00:41:25,960
Speaker 1: unless you have created a pattern and you're like, oh,

879
00:41:26,080 --> 00:41:28,720
Speaker 1: this is definitely my thing. I've been on my friend's

880
00:41:28,760 --> 00:41:32,520
Speaker 1: boat like five dozen times and I truly love it.

881
00:41:32,560 --> 00:41:34,279
Speaker 2: I've got I'm bitten by the bug. I've got a

882
00:41:34,280 --> 00:41:34,880
Speaker 2: passion for it.

883
00:41:34,920 --> 00:41:37,520
Speaker 1: Now, got to find a way to sink to get

884
00:41:37,560 --> 00:41:39,440
Speaker 1: the money so that I can sink it into this

885
00:41:39,480 --> 00:41:41,520
Speaker 1: hobby because it's truly a hobby and a passion of mine.

886
00:41:41,560 --> 00:41:45,200
Speaker 1: Now if but until you, I think have proven that out,

887
00:41:45,480 --> 00:41:47,520
Speaker 1: don't go all in and buy a boat or buy

888
00:41:47,560 --> 00:41:51,400
Speaker 1: a ridiculously cheap one. I guess so you're limiting your

889
00:41:51,400 --> 00:41:52,720
Speaker 1: potential losses totally.

890
00:41:52,840 --> 00:41:54,840
Speaker 2: Yeah. I think it just needs to crunch the numbers

891
00:41:54,840 --> 00:41:56,319
Speaker 2: as well. I think you need to find out how

892
00:41:56,360 --> 00:41:59,160
Speaker 2: many how much savings you can reasonably part with in

893
00:41:59,239 --> 00:42:01,480
Speaker 2: order to reduce balance, and then find out how much

894
00:42:01,480 --> 00:42:04,240
Speaker 2: free cashlow you can throw towards the debt in addition

895
00:42:04,280 --> 00:42:07,080
Speaker 2: to that every single month, and you can kind of

896
00:42:07,080 --> 00:42:09,879
Speaker 2: map this out and know the payoff timeline, which when

897
00:42:09,880 --> 00:42:11,759
Speaker 2: you have an end date in mind, I think that

898
00:42:11,760 --> 00:42:14,640
Speaker 2: can go so far as far as keeping you motivated

899
00:42:15,160 --> 00:42:16,960
Speaker 2: to know that, like this is what I'm going to

900
00:42:17,200 --> 00:42:19,280
Speaker 2: hit this goal. Like right now, I think he feels

901
00:42:19,320 --> 00:42:21,239
Speaker 2: like he's just making these payments and it feels like

902
00:42:21,239 --> 00:42:24,239
Speaker 2: it's going out into the lake, like it's just it's

903
00:42:24,280 --> 00:42:27,200
Speaker 2: just money going overboard, is going into the void as

904
00:42:27,239 --> 00:42:30,200
Speaker 2: opposed to having a plan to where he knows that

905
00:42:30,280 --> 00:42:33,160
Speaker 2: I will be done with his debt at this so

906
00:42:33,239 --> 00:42:35,360
Speaker 2: and so date. And I think if you have that

907
00:42:35,440 --> 00:42:37,960
Speaker 2: in mind, assuming that you love the boat, then you

908
00:42:38,000 --> 00:42:41,000
Speaker 2: can both confidence, you know, like you can literally know that, oh,

909
00:42:41,080 --> 00:42:42,600
Speaker 2: this is going to be limited by then, and I'll

910
00:42:42,600 --> 00:42:44,000
Speaker 2: own this thing free and clear, and That'll be a

911
00:42:44,040 --> 00:42:45,239
Speaker 2: great day. Yeah, for sure.

912
00:42:45,360 --> 00:42:46,799
Speaker 1: Are we got a couple more questions to get to,

913
00:42:47,040 --> 00:42:50,760
Speaker 1: including paying for your your down payment by selling stocks,

914
00:42:50,880 --> 00:43:00,480
Speaker 1: talking about that and more right after this, All.

915
00:43:00,520 --> 00:43:02,799
Speaker 2: Right, buddy, we are back from the break. Is now

916
00:43:02,960 --> 00:43:05,719
Speaker 2: time for the Facebook question of the Week, which is

917
00:43:05,719 --> 00:43:09,239
Speaker 2: from Michael. Does anyone have experience with renting out their

918
00:43:09,280 --> 00:43:12,680
Speaker 2: primary residence under the fourteen day rule. I live in

919
00:43:12,719 --> 00:43:15,640
Speaker 2: Boston and the FFO World Cup is occurring this summer,

920
00:43:15,680 --> 00:43:17,960
Speaker 2: so I'm exploring the idea of renting out my condo.

921
00:43:18,600 --> 00:43:21,719
Speaker 2: It's on the commuter line that heads directly to Foxboro

922
00:43:21,840 --> 00:43:24,600
Speaker 2: Gilette Stadium, but also near the Tee to spend time

923
00:43:24,640 --> 00:43:27,040
Speaker 2: in the city, so it's commediately located. You basically say,

924
00:43:27,040 --> 00:43:28,879
Speaker 2: it's a good It's gonna be a good rent. I'm

925
00:43:28,880 --> 00:43:32,319
Speaker 2: looking for advice of one what sits to use, two

926
00:43:32,560 --> 00:43:36,600
Speaker 2: reasonable precautions, three timelines and four I wish I'd known

927
00:43:36,640 --> 00:43:40,400
Speaker 2: this before running out my place. And uh dude, fourteen

928
00:43:40,440 --> 00:43:43,320
Speaker 2: day rule. This hearkens back to Augusta, Georgia.

929
00:43:43,440 --> 00:43:45,799
Speaker 1: Where are you from my hometown? Because of the whole

930
00:43:45,840 --> 00:43:48,640
Speaker 1: masters that's right, this is literally where it came from, right,

931
00:43:48,760 --> 00:43:50,800
Speaker 1: this this loophole in the tax code.

932
00:43:51,040 --> 00:43:55,640
Speaker 2: Yeah, nobody's resident knows the true it's like two eighty

933
00:43:55,719 --> 00:43:57,640
Speaker 2: or two eight or something like that. Is the actual

934
00:43:57,880 --> 00:43:59,640
Speaker 2: like four to one k, you know, sort of, but

935
00:43:59,680 --> 00:44:01,200
Speaker 2: no one, no one, cause of that. It's the fourteen

936
00:44:01,280 --> 00:44:03,480
Speaker 2: day rule. Because it's the fourteen day or the august

937
00:44:03,560 --> 00:44:05,879
Speaker 2: rule should be called the Gusta rule, right, And this

938
00:44:05,920 --> 00:44:08,239
Speaker 2: is because people would rent their house out for what

939
00:44:09,000 --> 00:44:11,880
Speaker 2: ten days to two weeks for the masters.

940
00:44:11,480 --> 00:44:14,360
Speaker 1: Or yeah not quite yeah one one whole week, yeah

941
00:44:14,360 --> 00:44:16,719
Speaker 1: for sure for Master's week. But and that's why they

942
00:44:16,760 --> 00:44:18,799
Speaker 1: just expanded it a little bit just to just in case.

943
00:44:18,880 --> 00:44:19,960
Speaker 2: Yeah, yes, but.

944
00:44:19,800 --> 00:44:21,840
Speaker 1: But yeah, if you rent a place out for fourteen

945
00:44:21,920 --> 00:44:23,880
Speaker 1: days or less than a calendar year, you do not

946
00:44:24,000 --> 00:44:26,839
Speaker 1: have to report that income on your taxes. You also

947
00:44:26,880 --> 00:44:29,960
Speaker 1: can't deduct rental expenses that you incur, Michael, But like

948
00:44:30,280 --> 00:44:33,720
Speaker 1: this is this is a real loophole for people who

949
00:44:33,880 --> 00:44:37,440
Speaker 1: like to rent their spot out occasionally, like for a

950
00:44:37,520 --> 00:44:39,320
Speaker 1: massive worldwide sporting event.

951
00:44:39,200 --> 00:44:41,320
Speaker 2: Right that only happens once every four.

952
00:44:41,200 --> 00:44:45,120
Speaker 1: Years, perhaps and even still not in not where you live,

953
00:44:45,719 --> 00:44:48,040
Speaker 1: right like the Olympics, or once in a lifetime world

954
00:44:48,320 --> 00:44:51,520
Speaker 1: exactly exactly. But this once, this offers a once in

955
00:44:51,560 --> 00:44:57,000
Speaker 1: a lifetime ability to make significant non taxable money, and

956
00:44:57,040 --> 00:44:58,800
Speaker 1: it just it just doesn't get much bigger.

957
00:44:58,800 --> 00:44:59,239
Speaker 2: In the World Cup.

958
00:44:59,360 --> 00:45:02,839
Speaker 1: I've got pretty cool a couple of rental properties, you know,

959
00:45:03,200 --> 00:45:07,399
Speaker 1: within spinning distance or a couple miles let's say, of

960
00:45:07,440 --> 00:45:10,080
Speaker 1: the World Cup site in Atlanta where we live, and

961
00:45:10,160 --> 00:45:13,719
Speaker 1: I have them under long term rental obligations. But part

962
00:45:13,760 --> 00:45:16,000
Speaker 1: of me was like, oh, man, should I not sign

963
00:45:16,000 --> 00:45:16,680
Speaker 1: another least with you?

964
00:45:16,840 --> 00:45:18,560
Speaker 2: I wonder what I could do or the.

965
00:45:18,520 --> 00:45:21,040
Speaker 1: Stakes that high that I could have done much better

966
00:45:21,120 --> 00:45:22,920
Speaker 1: and it would have been worth jumping through the hoops

967
00:45:23,160 --> 00:45:26,560
Speaker 1: to turn them into short term rentals. I ultimately didn't

968
00:45:26,800 --> 00:45:30,759
Speaker 1: do that, But I am curious when you look at

969
00:45:30,840 --> 00:45:32,920
Speaker 1: some of the headlines and you read some about what

970
00:45:33,000 --> 00:45:35,480
Speaker 1: some people are able to make it. Premier sporting events

971
00:45:35,480 --> 00:45:37,640
Speaker 1: like the World Cup. We're talking big money.

972
00:45:37,800 --> 00:45:39,920
Speaker 2: Yeah. Yeah. And by the way, if you rent it

973
00:45:39,960 --> 00:45:42,440
Speaker 2: for fifteen days, all bets are off and you're getting

974
00:45:42,440 --> 00:45:45,160
Speaker 2: tax on the money. So make sure you keep good

975
00:45:45,840 --> 00:45:48,360
Speaker 2: a good record or a good log, which I will say.

976
00:45:48,920 --> 00:45:52,839
Speaker 2: You're asking about sites Airbnb, even furnish Finder they make

977
00:45:52,840 --> 00:45:54,839
Speaker 2: that pretty easily right, so they've got the records there

978
00:45:54,880 --> 00:45:59,280
Speaker 2: as far as how much you've rented it. But honestly, Airbnb,

979
00:45:59,320 --> 00:46:01,239
Speaker 2: they kind of corner the market for stuff like this

980
00:46:01,840 --> 00:46:05,880
Speaker 2: furnish Finder. It's typically best when you're looking for listing

981
00:46:05,880 --> 00:46:10,360
Speaker 2: your place for longer stays. So yeah, and this Airbnb

982
00:46:10,480 --> 00:46:13,680
Speaker 2: is not even paying for this us talking about it here,

983
00:46:13,840 --> 00:46:16,799
Speaker 2: which by the way, they used to no, I mean

984
00:46:16,840 --> 00:46:18,920
Speaker 2: not like the actual content I'm talking about. We used

985
00:46:18,960 --> 00:46:21,840
Speaker 2: to have a Yeah, So reach out to your boys

986
00:46:21,840 --> 00:46:26,600
Speaker 2: over at how the money. But Michael, before putting your

987
00:46:26,640 --> 00:46:29,200
Speaker 2: your listening out there, do some research. Do do a

988
00:46:29,239 --> 00:46:33,200
Speaker 2: detailed analysis of what you should be asking. Air DNA

989
00:46:33,360 --> 00:46:36,239
Speaker 2: is a site that's got a lot of great information

990
00:46:36,320 --> 00:46:39,319
Speaker 2: and stats, and it's live and so they're able to

991
00:46:39,360 --> 00:46:41,799
Speaker 2: give you all the latest information because you really might

992
00:46:41,840 --> 00:46:44,600
Speaker 2: be talking close to like one thousand dollars a night,

993
00:46:44,880 --> 00:46:46,200
Speaker 2: maybe like maybe even more.

994
00:46:46,280 --> 00:46:49,200
Speaker 1: It just depends on what folks are are spending, depends

995
00:46:49,239 --> 00:46:52,200
Speaker 1: on the competition, depends on it sounds like proximity is

996
00:46:52,239 --> 00:46:55,600
Speaker 1: really good. It also depends on which matches right, like,

997
00:46:56,000 --> 00:46:58,520
Speaker 1: are are going to be at the stadium nearby? And

998
00:46:59,120 --> 00:47:04,000
Speaker 1: I forget which rounds are where and whether in New

999
00:47:04,000 --> 00:47:08,839
Speaker 1: England if they're going to have like this, Yeah, the.

1000
00:47:08,800 --> 00:47:11,040
Speaker 2: Closer you get to the finals, you're talking about bigger

1001
00:47:11,040 --> 00:47:14,120
Speaker 2: money even more, you know, like that absolutely, I will say, like,

1002
00:47:14,160 --> 00:47:18,400
Speaker 2: while we're talking about Airbnb, having had experience there, I

1003
00:47:18,440 --> 00:47:20,680
Speaker 2: think the biggest thing I would be concerned about is

1004
00:47:20,719 --> 00:47:23,240
Speaker 2: someone showing up because again, this is like a potentially

1005
00:47:23,320 --> 00:47:25,520
Speaker 2: once in like you don't go to the World Cup

1006
00:47:25,520 --> 00:47:27,960
Speaker 2: all the time, so somebody who might be renting for

1007
00:47:28,080 --> 00:47:29,960
Speaker 2: them it's a once in a lifetime experience as well,

1008
00:47:29,960 --> 00:47:31,880
Speaker 2: and they may not care what happens to your place,

1009
00:47:32,280 --> 00:47:35,680
Speaker 2: And so I would be I would turn off personally,

1010
00:47:36,480 --> 00:47:38,680
Speaker 2: I would turn off the instant book feature because I

1011
00:47:38,680 --> 00:47:41,080
Speaker 2: think I would want to review folks who are look

1012
00:47:41,160 --> 00:47:42,800
Speaker 2: or who are trying to book my place, and I

1013
00:47:42,840 --> 00:47:45,360
Speaker 2: would be and this is something that you're totally allowed

1014
00:47:45,360 --> 00:47:47,080
Speaker 2: to do, but I would be. I would even spell

1015
00:47:47,080 --> 00:47:51,000
Speaker 2: it out and say, hey, I'm only accepting highly rated renters.

1016
00:47:51,120 --> 00:47:54,160
Speaker 2: That is totally something that you can do. Uh, someone

1017
00:47:54,160 --> 00:47:57,640
Speaker 2: who has broken house rules previously, like that is something

1018
00:47:57,760 --> 00:48:00,600
Speaker 2: that is That is somebody you can deny. You can't

1019
00:48:00,960 --> 00:48:05,279
Speaker 2: deny based on like vibes. Like if that's the case,

1020
00:48:05,280 --> 00:48:07,080
Speaker 2: there's a good chance you're starting to gal not a

1021
00:48:07,080 --> 00:48:09,520
Speaker 2: smile in their picture. Yeah, you want to avoid that,

1022
00:48:09,600 --> 00:48:12,960
Speaker 2: but you can totally only rent to people who are

1023
00:48:13,200 --> 00:48:15,239
Speaker 2: incredibly highly rated on Airbnb, And.

1024
00:48:15,239 --> 00:48:17,440
Speaker 1: I'd say don't forget to take great photos, write a

1025
00:48:17,440 --> 00:48:20,799
Speaker 1: description that cater specifically to the World Cup crowd, like

1026
00:48:20,840 --> 00:48:25,040
Speaker 1: you can actually on Chris specific tailor you're listing, sell

1027
00:48:25,080 --> 00:48:27,359
Speaker 1: your place well, right, I'd want to list as soon

1028
00:48:27,400 --> 00:48:30,319
Speaker 1: as possible. A lot of those places have already gotten

1029
00:48:30,320 --> 00:48:34,080
Speaker 1: booked or people are booking now. Also, though, if you're

1030
00:48:34,080 --> 00:48:36,120
Speaker 1: willing to gamble a bit, you might find that prices

1031
00:48:36,120 --> 00:48:38,360
Speaker 1: go up closer to match dates since there will be

1032
00:48:38,400 --> 00:48:41,839
Speaker 1: fewer options and maybe less competition out there. So that's

1033
00:48:41,880 --> 00:48:44,319
Speaker 1: at least worth considering if you're if the trade off

1034
00:48:44,320 --> 00:48:48,279
Speaker 1: of potentially making more and or in maybe not being

1035
00:48:48,320 --> 00:48:51,520
Speaker 1: able to find someone at a last minute or with

1036
00:48:51,560 --> 00:48:53,080
Speaker 1: the also the potential being able to get a much

1037
00:48:53,120 --> 00:48:54,799
Speaker 1: higher price. If you're willing to make that trade off

1038
00:48:54,800 --> 00:48:57,880
Speaker 1: that gamble, then consider it, and you might also want

1039
00:48:57,920 --> 00:48:59,840
Speaker 1: to I think another way to protect yourself is consider

1040
00:48:59,840 --> 00:49:02,440
Speaker 1: a minimums stay length so you're not having like tons

1041
00:49:02,480 --> 00:49:05,680
Speaker 1: of turnover, especially since you don't typically host. I don't

1042
00:49:05,680 --> 00:49:06,880
Speaker 1: know how far you're going to be staying. Are you

1043
00:49:06,920 --> 00:49:09,440
Speaker 1: going to go come in there and clean the unit yourself, like,

1044
00:49:09,520 --> 00:49:11,719
Speaker 1: do all the laundry, get things set back up. But

1045
00:49:11,920 --> 00:49:14,960
Speaker 1: it's at least worth considering, like, oh, maybe if I

1046
00:49:14,960 --> 00:49:16,439
Speaker 1: have a minimum.

1047
00:49:15,880 --> 00:49:17,680
Speaker 2: Four night's day or something like that, or a three

1048
00:49:17,760 --> 00:49:18,440
Speaker 2: nights day.

1049
00:49:18,440 --> 00:49:23,480
Speaker 1: And target again those highly desirable matches as opposed to Yeah,

1050
00:49:23,520 --> 00:49:25,480
Speaker 1: cause again we're talking about being able to take advantage

1051
00:49:25,480 --> 00:49:27,800
Speaker 1: of the fourteen day. You're not listening at all summer

1052
00:49:28,600 --> 00:49:30,520
Speaker 1: making sure you're targeting the specific matches.

1053
00:49:30,719 --> 00:49:32,359
Speaker 2: Yeah. I don't know how many are being played at

1054
00:49:32,600 --> 00:49:34,719
Speaker 2: Boston specifically. Yeah, but it's one of the things.

1055
00:49:34,719 --> 00:49:36,920
Speaker 1: Maybe they're coming for multiple matches, or maybe they're coming

1056
00:49:36,960 --> 00:49:39,600
Speaker 1: for a match and to enjoy the city. But anything

1057
00:49:39,640 --> 00:49:42,719
Speaker 1: that prevents you from having like three or four one

1058
00:49:42,800 --> 00:49:44,200
Speaker 1: night's day is that make it a little bit more

1059
00:49:44,239 --> 00:49:46,800
Speaker 1: difficult to manage. I think one other thing that you're highlighting,

1060
00:49:46,840 --> 00:49:50,120
Speaker 1: like vetting people who are going to stay at your place,

1061
00:49:50,120 --> 00:49:50,920
Speaker 1: which I think is helpful.

1062
00:49:51,360 --> 00:49:52,560
Speaker 2: It's also helpful to meet them.

1063
00:49:52,840 --> 00:49:54,719
Speaker 1: I think when you shake somebody's hand, you look them

1064
00:49:54,719 --> 00:49:56,960
Speaker 1: in the eye, like what they tend to take care

1065
00:49:57,000 --> 00:50:00,520
Speaker 1: of your place differently than if you just have automatic

1066
00:50:00,520 --> 00:50:02,799
Speaker 1: code to let them in airbb we sure have more

1067
00:50:02,800 --> 00:50:05,000
Speaker 1: of those vibes. It doesn't anymore. But if you can

1068
00:50:05,040 --> 00:50:07,080
Speaker 1: be the host who's on the ground, who actually meets them,

1069
00:50:07,160 --> 00:50:10,680
Speaker 1: even that just fifteen minute interaction or five minute interaction

1070
00:50:10,960 --> 00:50:12,160
Speaker 1: to make a difference less.

1071
00:50:12,040 --> 00:50:13,839
Speaker 2: Likely to trash your place. Yeah, all right, let's take

1072
00:50:13,880 --> 00:50:16,160
Speaker 2: another one from Lucas, who writes a lot of the

1073
00:50:16,200 --> 00:50:18,160
Speaker 2: money I'm planning to use for a down payment is

1074
00:50:18,200 --> 00:50:21,160
Speaker 2: in stocks right now. Our timeline for buying a home

1075
00:50:21,200 --> 00:50:23,480
Speaker 2: has moved up, and we may be looking as soon

1076
00:50:23,520 --> 00:50:26,520
Speaker 2: as late March. That's really soon. Do I go ahead

1077
00:50:26,560 --> 00:50:28,360
Speaker 2: and sell those stocks now? Or is that much of

1078
00:50:28,400 --> 00:50:32,680
Speaker 2: a cash inflow going to look weirdly? Suspect? Normally we

1079
00:50:32,760 --> 00:50:35,200
Speaker 2: use better mortgage due to no fees. But not sure

1080
00:50:35,239 --> 00:50:37,600
Speaker 2: if I can explain my situation. Well to the online

1081
00:50:37,600 --> 00:50:41,440
Speaker 2: help bots, not sure if the timing of selling my

1082
00:50:41,520 --> 00:50:43,400
Speaker 2: stocks mattered what you think, Joel.

1083
00:50:43,680 --> 00:50:47,760
Speaker 1: Online help bots not so helpful, not always helpful. Well,

1084
00:50:47,960 --> 00:50:50,400
Speaker 1: it sounds like it's time to sell, right from Luke.

1085
00:50:50,480 --> 00:50:53,759
Speaker 1: If I was in Lucas's seat, in his position, I

1086
00:50:53,920 --> 00:50:57,239
Speaker 1: would want to sell those stockholdings. And you know, I

1087
00:50:57,280 --> 00:50:59,360
Speaker 1: just wouldn't want to risk a quick market correction, a

1088
00:50:59,440 --> 00:51:03,040
Speaker 1: decline in purchasing capital. At this point in the game,

1089
00:51:03,880 --> 00:51:07,359
Speaker 1: we're very close. Typically we would suggest people sell far

1090
00:51:07,360 --> 00:51:10,960
Speaker 1: in advance, although Lucas year or two. Yeah, Lucas has benefited.

1091
00:51:11,160 --> 00:51:14,520
Speaker 1: I would say, though, from staying invested. One big thing

1092
00:51:14,560 --> 00:51:17,680
Speaker 1: to consider those tax implications of this sale. How long

1093
00:51:17,760 --> 00:51:21,040
Speaker 1: you've owned those positions is important because it'll determine whether

1094
00:51:21,160 --> 00:51:23,600
Speaker 1: or not you pay the more favorable long term capital

1095
00:51:23,640 --> 00:51:26,320
Speaker 1: gains rate or not. So know that even if it

1096
00:51:26,360 --> 00:51:28,960
Speaker 1: doesn't change how you proceed, because it might not. It

1097
00:51:28,960 --> 00:51:30,520
Speaker 1: sounds like you need this money for the down payment

1098
00:51:30,520 --> 00:51:33,040
Speaker 1: no matter what. But I guess I would also just

1099
00:51:33,040 --> 00:51:36,440
Speaker 1: consider yourself fortunate that your investment's done well and that

1100
00:51:36,480 --> 00:51:39,239
Speaker 1: despite this quicker timeline, you're in a great position to sell.

1101
00:51:39,440 --> 00:51:41,200
Speaker 2: Yeah, and by the way. It's not going to look

1102
00:51:41,280 --> 00:51:44,440
Speaker 2: sus to sell your stock position. You need to be

1103
00:51:45,000 --> 00:51:48,520
Speaker 2: professional about it. You get your documents that you are

1104
00:51:48,640 --> 00:51:51,160
Speaker 2: likely going to need to submit there as you apply

1105
00:51:51,200 --> 00:51:54,319
Speaker 2: for your mortgage, like your most recent broker statements for

1106
00:51:54,360 --> 00:51:56,800
Speaker 2: the past two or three months. You're also going to

1107
00:51:56,840 --> 00:51:59,640
Speaker 2: need to have the proof of stock sale, and then

1108
00:51:59,760 --> 00:52:02,600
Speaker 2: I think, I think the corresponding bank statement showing that

1109
00:52:02,680 --> 00:52:05,080
Speaker 2: the funds actually landed there in the account that you're using.

1110
00:52:05,360 --> 00:52:07,799
Speaker 2: This is a totally normal thing. Lenders are, I think,

1111
00:52:07,840 --> 00:52:10,040
Speaker 2: are honestly more and more used to dealing with this

1112
00:52:10,760 --> 00:52:12,839
Speaker 2: these days than even they were, you know, one hundred

1113
00:52:12,840 --> 00:52:13,879
Speaker 2: percent and fifteen years ago.

1114
00:52:13,960 --> 00:52:16,440
Speaker 1: Well, our friend Rob, who's a mortgage lender, who's awesome.

1115
00:52:16,480 --> 00:52:18,560
Speaker 1: I've used him before. He is a part of the

1116
00:52:18,600 --> 00:52:20,640
Speaker 1: how to money community in the Facebook group. He said

1117
00:52:20,840 --> 00:52:23,400
Speaker 1: in reply, he said, you shouldn't be picking a lender

1118
00:52:23,520 --> 00:52:25,640
Speaker 1: solely based on fees. It should be the rate you're

1119
00:52:25,680 --> 00:52:29,120
Speaker 1: getting in any points paid for it, plus fees. He

1120
00:52:29,200 --> 00:52:31,840
Speaker 1: said a higher rate would likely offset those fees in

1121
00:52:31,880 --> 00:52:34,319
Speaker 1: a short time period. And Rob's spot on here. Rob's

1122
00:52:34,360 --> 00:52:37,560
Speaker 1: got so much like wisdom in this area, and it's

1123
00:52:37,600 --> 00:52:40,520
Speaker 1: just crucial to mention that some online lenders, yeah, they

1124
00:52:40,600 --> 00:52:43,839
Speaker 1: might offer better rates and potentially lower fees, but some don't.

1125
00:52:44,160 --> 00:52:47,600
Speaker 1: And some of the overall best overall mortgage quotes we've

1126
00:52:47,640 --> 00:52:50,640
Speaker 1: received have come from local credit unions and banks. And

1127
00:52:50,800 --> 00:52:53,600
Speaker 1: one other benefit of using a local credit union or

1128
00:52:53,680 --> 00:52:57,360
Speaker 1: bank is that many of those local lenders are better

1129
00:52:57,440 --> 00:53:00,600
Speaker 1: at sticking to a tight closing timeline. So if you're like,

1130
00:53:00,640 --> 00:53:03,480
Speaker 1: I got to close in three weeks, well, some of

1131
00:53:03,480 --> 00:53:09,040
Speaker 1: those online companies, they're not as adept, right as nimble? Yeah, yeah,

1132
00:53:09,120 --> 00:53:12,200
Speaker 1: not as nimble. And so when you have a personal

1133
00:53:12,200 --> 00:53:15,080
Speaker 1: relationship with somebody, and I'm not saying it justifies paying

1134
00:53:15,560 --> 00:53:18,000
Speaker 1: a much higher rate or much higher fees, but I

1135
00:53:18,040 --> 00:53:21,640
Speaker 1: think it has been beneficial for me in the past.

1136
00:53:21,640 --> 00:53:22,920
Speaker 1: I've been able to get kind of the best of

1137
00:53:22,920 --> 00:53:26,439
Speaker 1: both worlds. So, and this is another reason to get

1138
00:53:26,520 --> 00:53:29,399
Speaker 1: multiple quotes and not just go say this is usually

1139
00:53:29,440 --> 00:53:31,239
Speaker 1: the best and based on their marketing and based on

1140
00:53:31,400 --> 00:53:33,480
Speaker 1: the time I use them before, they had the best

1141
00:53:33,520 --> 00:53:35,879
Speaker 1: rates in the lowest fees. You need to check every

1142
00:53:35,880 --> 00:53:39,480
Speaker 1: time because the stakes are significant. And we've talked about

1143
00:53:39,480 --> 00:53:42,319
Speaker 1: Matt some of the mortgage products at local credit unions

1144
00:53:42,400 --> 00:53:44,359
Speaker 1: right now how much better they are than what you're

1145
00:53:44,360 --> 00:53:49,560
Speaker 1: seeing out there on the major websites. So shopping around

1146
00:53:49,600 --> 00:53:52,560
Speaker 1: for a mortgage every time with multiple lenders is like

1147
00:53:52,600 --> 00:53:54,080
Speaker 1: a non negotiable necessity.

1148
00:53:54,360 --> 00:53:54,680
Speaker 4: Eck.

1149
00:53:54,920 --> 00:53:56,640
Speaker 2: Yeah, all right, dude. The beer that you and I

1150
00:53:56,760 --> 00:54:00,640
Speaker 2: enjoyed was a Harpeth, which is a double IPA by

1151
00:54:01,040 --> 00:54:03,839
Speaker 2: Living Waters Brewing. What do you think this? By the way,

1152
00:54:03,880 --> 00:54:07,600
Speaker 2: this is a West Coast i PA with petcherine, peckerine,

1153
00:54:07,640 --> 00:54:12,279
Speaker 2: I don't know, chinook and Columbus cryo hops. Yeah, could

1154
00:54:12,320 --> 00:54:14,480
Speaker 2: you taste the cryo? I don't know.

1155
00:54:14,560 --> 00:54:16,440
Speaker 1: I don't know, I don't know what it tastes like,

1156
00:54:16,760 --> 00:54:20,399
Speaker 1: but I will say I used to not love West

1157
00:54:20,440 --> 00:54:23,600
Speaker 1: Coast i pas very much, just a little too bitter,

1158
00:54:23,680 --> 00:54:28,600
Speaker 1: too mouth punchy. This this like new breed of a

1159
00:54:29,239 --> 00:54:31,640
Speaker 1: new wave of Yeah, it's like, oh man, I'm getting

1160
00:54:31,719 --> 00:54:33,600
Speaker 1: kind of the grapefruit and the pine, Dude.

1161
00:54:33,640 --> 00:54:37,400
Speaker 2: I totally like, I feel like I was drinking grapefruit juice,

1162
00:54:37,440 --> 00:54:41,120
Speaker 2: which typically sounds thin and sharp, but like this was

1163
00:54:41,160 --> 00:54:43,360
Speaker 2: so savory at the same time. This is a like

1164
00:54:43,520 --> 00:54:46,160
Speaker 2: I'm normally not a fan of West Coast i pas,

1165
00:54:46,239 --> 00:54:49,000
Speaker 2: but yeah, like you have the immediate West Coast sort

1166
00:54:49,040 --> 00:54:53,040
Speaker 2: of pith, but also it balanced out, It finished out

1167
00:54:53,080 --> 00:54:56,440
Speaker 2: real smooth, didn't leave you just with that sting stinging

1168
00:54:56,480 --> 00:54:58,920
Speaker 2: on your cheek for a slap. Yeah, finished strong, Yeah not.

1169
00:54:59,640 --> 00:55:02,120
Speaker 1: It was mouth busting in the way that I think

1170
00:55:02,280 --> 00:55:04,279
Speaker 1: all the old West Coast IPAs were.

1171
00:55:04,480 --> 00:55:06,080
Speaker 2: That's what they're going for back in the day. Yeah,

1172
00:55:06,520 --> 00:55:08,680
Speaker 2: I'm going to wreck your palate, but there was.

1173
00:55:08,840 --> 00:55:11,239
Speaker 1: Yeah, they literally had beer's name palette record and and

1174
00:55:11,719 --> 00:55:14,920
Speaker 1: that ILK just was too much for me to handle

1175
00:55:14,920 --> 00:55:17,200
Speaker 1: after a while, even though, and so I don't know,

1176
00:55:17,239 --> 00:55:21,040
Speaker 1: it's nice to get that flavor profile without the full

1177
00:55:21,080 --> 00:55:22,279
Speaker 1: on assault of your mouth.

1178
00:55:22,480 --> 00:55:24,560
Speaker 2: Totally agree. This was a good one. Glad you and

1179
00:55:24,560 --> 00:55:26,560
Speaker 2: I got to enjoy that we got to share this one.

1180
00:55:26,600 --> 00:55:28,480
Speaker 2: But that's going to be it for this episode. Folks

1181
00:55:28,520 --> 00:55:31,120
Speaker 2: can find our show notes up on the website at

1182
00:55:31,120 --> 00:55:34,000
Speaker 2: howto money dot com, including links to any resources we

1183
00:55:34,080 --> 00:55:37,520
Speaker 2: may have mentioned or past episodes that we may have mentioned,

1184
00:55:37,560 --> 00:55:41,880
Speaker 2: like the conversation with Zeke Fox about bitcoin. And you

1185
00:55:41,920 --> 00:55:44,000
Speaker 2: mentioned one too, I think in that capitalized article.

1186
00:55:44,440 --> 00:55:46,480
Speaker 1: Yes, yeah, you want to roll over your old four

1187
00:55:46,480 --> 00:55:48,839
Speaker 1: oh one k, avoid fees, do it for free, make

1188
00:55:48,880 --> 00:55:49,240
Speaker 1: it easy.

1189
00:55:49,239 --> 00:55:51,080
Speaker 2: That's a great place to turn heck yeah, and of

1190
00:55:51,120 --> 00:55:54,160
Speaker 2: course that's at how Too Money dot com. Buddy, that's

1191
00:55:54,160 --> 00:55:56,359
Speaker 2: going to be it for this episode. So until next time,

1192
00:55:56,480 --> 00:56:10,680
Speaker 2: best Friends Out, Best Friends Out,