Speaker 1: Episode three sixty one. What are mutual funds and what
Speaker 1: do they cost?
Speaker 2: Welcome to the Frugal Friends podcast, where you'll learn to
Speaker 2: save money, embrace simplicity, and liver your life. Here your
Speaker 2: hosts Jen and Jill.
Speaker 1: Welcome to the Frugal Friends podcast. My name is Jen,
Speaker 1: my name is Jell, and today we are talking about
Speaker 1: mutual funds. If you have not heard that phrase before,
Speaker 1: it is an investing term and it can sometimes be
Speaker 1: confused when we're talking about all the different types of funds.
Speaker 1: So stock fund, bond fund, index fund, exchange traded fund,
Speaker 1: mutual fund. So there's all these different types of funds,
Speaker 1: and we're going to talk about how you figure out
Speaker 1: what's going in your roth IRA for one k, and
Speaker 1: if you're working with a financial advisor, how to figure
Speaker 1: out if that person is working in your best interest
Speaker 1: or not. Because a lot of the terms we're going
Speaker 1: to talk about today, it's not gonna be like an
Speaker 1: education like a you know, Miriam Webster sort of thing.
Speaker 1: But once you understand what a mutual fund is, you'll
Speaker 1: be better able to advocate for yourself.
Speaker 3: This entire episode will be my Jill Vulnerability Round I
Speaker 3: kind of view myself, like how musicians will sometimes describe
Speaker 3: themselves as I don't know how to read music, I
Speaker 3: just know how to play. It is what I am
Speaker 3: to this entire podcast episode. I have invested in mutual funds,
Speaker 3: but I don't know how to read them, talk.
Speaker 4: About them, explain them.
Speaker 3: So this is equally for me as it is for
Speaker 3: the rest of you listeners, and I'm going to alongside
Speaker 3: you and Jen I didn't tell you this, but my
Speaker 3: approach to this episode is as my own questions come up,
Speaker 3: I'm going to ask you them because verfability and chances
Speaker 3: are someone else has similar questions. If you're really literally
Speaker 3: starting at ground zero, I'm here for you.
Speaker 1: I got you, yeah, And this is for you. This
Speaker 1: is not an investing podcast. We're not getting into the
Speaker 1: nitty gritty. We are really just educating you enough to
Speaker 1: do it yourself, do your own investing if that's what
Speaker 1: you want, and to advocate for yourself. So if you
Speaker 1: already know, if you've read you The Simple Path to
Speaker 1: Wealth by Jail Collins, you probably I mean, this is
Speaker 1: going to be a fun episode to listen to to
Speaker 1: just reinforce everything, but you're probably not going to learn
Speaker 1: anything new But if you're looking after this episode you
Speaker 1: want to learn more Simple Path to Wealth by Jail Collins.
Speaker 1: It's one of our book club books and it is
Speaker 1: a highly recommended book in our circle. But first, before
Speaker 1: we get into mutual funds and how much they cost,
Speaker 1: this episode is brought to you by stickers. We love
Speaker 1: a good sticker, whether it is on your bumper, your
Speaker 1: cup that is not a Stanley cup, your kindle, all
Speaker 1: the the dresser in your child's room that is designated
Speaker 1: the only place where they can put their stickers. If
Speaker 1: you haven't tried that and you're looking for a way
Speaker 1: to condense all the stickers in your house, try the
Speaker 1: dresser method. This episode is brought to you by all
Speaker 1: those stickers because we have our own stickers. Frugal Friends
Speaker 1: has our own stickers. We have a cool logo bumper sticker.
Speaker 1: We have a cool sticker with pineapples that represent us
Speaker 1: wearing sunglasses, us as pineapples wearing sunglasses with dollar bills
Speaker 1: coming out of the top where the green stuff is.
Speaker 1: We have those and we want to give them to
Speaker 1: you for free. You cannot buy these stickers. You can
Speaker 1: only get them for free by referring people to the
Speaker 1: friend letter. So if you are on our newsletter, we
Speaker 1: send it out three times a week with money saving
Speaker 1: tips and every freebies in every single newsletter and at
Speaker 1: the bottom of every newsletter, you have a unique code
Speaker 1: that you can share on your Facebook, in your Instagram profile,
Speaker 1: in your Slack channel, or your Microsoft teams or whatever.
Speaker 5: Share it.
Speaker 1: And if one person signs up to receive the friend
Speaker 1: letter because of your sharing link, because of the link
Speaker 1: you shared, you get a sticker pack. We will send
Speaker 1: it to you. That's it, that's all it takes.
Speaker 4: Stuck a pack, not even one stick sticker pack.
Speaker 5: You get both stickers.
Speaker 1: Yes, so head to Frugal friendspodcast dot com to get
Speaker 1: the friend letter. If you haven't signed up before, or
Speaker 1: if you're already on the friend letter, then head to
Speaker 1: the latest release and scroll down to the bottom to
Speaker 1: get your unique link.
Speaker 4: Do it.
Speaker 1: Yes, So we do an investing episode maybe once a quarter,
Speaker 1: just a few times a year, because your investments are
Speaker 1: not just important to you retiring one day, but the
Speaker 1: earlier you start investing, the more money you save on
Speaker 1: the total amount that you need, your total goal amount.
Speaker 1: So let's say that's just to be easy a million
Speaker 1: dollars that you want to have a million dollars saved
Speaker 1: for retirement. If you start early and just invest a
Speaker 1: little bit per month, overall, you will have to contribute
Speaker 1: less than if you start later and invest more per month.
Speaker 1: So it saves you money to start earlier, even with
Speaker 1: life lower amounts. So that's why we talk about We
Speaker 1: also want you to know that you can invest on
Speaker 1: your own via your four oh one k in your IRA.
Speaker 1: You can do this all on your own. You do
Speaker 1: not need a professional to do it for you. You
Speaker 1: absolutely can hire somebody, and we'll talk about kind of
Speaker 1: a few tips on how to choose that person throughout
Speaker 1: this episode. But we also want these episodes to help
Speaker 1: you gain the confidence to do it yourself because you
Speaker 1: save the most money obviously by doing it yourself. That
Speaker 1: that's frugality, and you spend a little bit more. The
Speaker 1: more help you get. You don't have to if you
Speaker 1: don't want to do it yourself, you don't have to
Speaker 1: jump straight to hiring a person.
Speaker 5: There's stuff you can do in between. So that being.
Speaker 1: Said, a few of the few of our favorite investing
Speaker 1: episodes that we've done. Episode one eighty Minimalist investing. We
Speaker 1: go through our favorite the ones that I have personally
Speaker 1: used in the past. Because we can't give you investment advice,
Speaker 1: We can't tell you what to invest in, but these
Speaker 1: are things both Jill and I have personally invested in
Speaker 1: and that if you read any reputable blog or book,
Speaker 1: they will talk about these and there's a reason that
Speaker 1: these things get talked about a lot. If you're hearing
Speaker 1: something new, uh, then that's when to be skeptical. But
Speaker 1: if you're hearing something over and over and over and over,
Speaker 1: that's that's going to be a better use of your
Speaker 1: time and looking into. But Minimalist Investing goes over the one, two,
Speaker 1: and three fund portfolios that we use, and then episode
Speaker 1: one six Understanding the stock Market and Investing with Bola Socombie.
Speaker 1: She is from Clever Girl Finance, and that's where we
Speaker 1: go through more of the like Miriam Webster, understand the
Speaker 1: names and terms. So this is just going to be
Speaker 1: kind of deciphering what's in your four oh one K,
Speaker 1: what is in your IRA or should be in it.
Speaker 1: So let's start with our first article. It's from bank
Speaker 1: Rate and it's what are mutual funds? So Jill, you
Speaker 1: went through this article before I did, and what is
Speaker 1: your first impression?
Speaker 3: This is my contribution this article. There were other articles
Speaker 3: in our outline that probably you are Goldie put into it,
Speaker 3: and it already felt like the step ahead of this article,
Speaker 3: and I'm like, well, hold on, we need to back
Speaker 3: up and just define mutual funds before we talk about
Speaker 3: all the other things that the questions that might come
Speaker 3: after that. Every other article assumed you already knew, and
Speaker 3: I didn't.
Speaker 4: I couldn't.
Speaker 3: I couldn't totally tell you and give you an exact definition.
Speaker 3: So I loved this article because it really helped me
Speaker 3: to get a grasp on some of the things that
Speaker 3: I'm all ready doing to invest for retirement and helps
Speaker 3: me to read the music. I don't want to, I
Speaker 3: just want to play the music, but here we go.
Speaker 3: A mutual fund is an investment vehicle that allows individuals
Speaker 3: to invest their money along with other investors. So essentially,
Speaker 3: these funds invest in a collection of securities like stocks, bonds,
Speaker 3: money market funds. Most mutual funds invest in a large
Speaker 3: number of those securities, so that's what allows you the
Speaker 3: investor to diversify your portfolio, which can help to reduce
Speaker 3: risk overall, So the collection of investments on their own
Speaker 3: would be too much typically for an average single investor
Speaker 3: to own. So this opportunity for people to pool their
Speaker 3: money together can be really beneficial for more your average investors.
Speaker 3: So one of the ways that I also read in
Speaker 3: another article that kind of helped me to understand a
Speaker 3: mutual fund is thankfully this language isn't super out there
Speaker 3: in terms of what it's talking about. Like, a mutual
Speaker 3: fund is a mutually funded investment. Meaning if we were
Speaker 3: all kind of standing around an island in a kitchen
Speaker 3: and there was a bowl in the middle of it,
Speaker 3: and every one of us put in one hundred dollars
Speaker 3: into that bowl, we are mutually funding the money in
Speaker 3: that bowl. Then the money in that bowl can go
Speaker 3: and invest in these different securities that we've mentioned. So
Speaker 3: that's essentially what you're doing with a mutual fund. You're
Speaker 3: not owning individual stocks, You're you're owning kind of the
Speaker 3: investment into those stocks. You're mutually funding it. How'd I
Speaker 3: do jen?
Speaker 1: That's perfect, Yes, that is a perfect way to say it.
Speaker 1: The investment vehicle kind of picture. It's so if I
Speaker 1: could maybe use a farmer's market let's think about a
Speaker 1: farmer's market. So farmer's market is in our city. It's
Speaker 1: in one parking lot, and it's got a bunch of
Speaker 1: different booths in it, and so and it's in you know,
Speaker 1: a larger city rather and there can be multiple farmers'
Speaker 1: markets in the city. Right, So your roth ira or
Speaker 1: your four oh one k is the city and it
Speaker 1: can hold as many mutual.
Speaker 5: Funds as you want it to. And those are the
Speaker 5: farmer's markets.
Speaker 1: And the farmer's markets are made up of individual booths
Speaker 1: and those are the stocks, bonds, real estate, utilities, all
Speaker 1: kinds of different things. You have all kinds of different
Speaker 1: things at the farmer's market. So that's kind of a
Speaker 1: way to look at it. And we're we're looking at
Speaker 1: the actual farmers market today. And there are a lot
Speaker 1: of different types of mutual funds. So we talk a
Speaker 1: lot about index funds because they're low cost and we
Speaker 1: love them. Index funds are a type of mutual fund
Speaker 1: which not a lot of people realize. It was one
Speaker 1: of the things. It took me a long time of
Speaker 1: investing and learning about investing before I put two and
Speaker 1: two together. So there are different types of funds we've
Speaker 1: got equity funds, which is you know stocks, all kinds
Speaker 1: of different stocks, large companies, small companies, growing companies.
Speaker 5: And these are.
Speaker 1: They're called small cap, which is small, smaller companies, large
Speaker 1: cap with there are the larger companies, growth funds, growth
Speaker 1: you know stocks. Those are the companies that are growing rapidly.
Speaker 1: So there they seem like intimidating terms, but they're not.
Speaker 1: That's just you know, small, large, growing. And you've got
Speaker 1: your bond funds, which are the bonds, which are debts
Speaker 1: that you buy a bond and that money is loaned
Speaker 1: out to somebody depending on the type of bond. So
Speaker 1: you got your bond funds, and you have balanced funds,
Speaker 1: which is a collection of both. Those are those target
Speaker 1: date funds we talk about so much. That's a balanced fund.
Speaker 1: And then you've got your index funds, which can be stocks,
Speaker 1: can be bonds. Index funds just means that it is
Speaker 1: a it's following a some kind of index, so it
Speaker 1: is maybe the S and P five hundred or the
Speaker 1: NAS deck. These are different indexes that kind of track
Speaker 1: the health of the stock market, and that that index
Speaker 1: fund is just tracking that. So a total stock market
Speaker 1: is going to have the total stock market kind of
Speaker 1: in ratio of and like weight of these large companies
Speaker 1: to small companies. That's why if you look at the
Speaker 1: S and P five hundred and the total stock market
Speaker 1: fund next to each other, those top ten funds are
Speaker 1: going to be pretty much the same because they're going
Speaker 1: to be in a similar just the ratios are going
Speaker 1: to be a little bit different, but they're not going
Speaker 1: to be that different. The total stock market is just
Speaker 1: going to have those small, smaller cap stocks in it
Speaker 1: where the S and P five hundred would it, So
Speaker 1: they're all very similar, like if you're looking at it,
Speaker 1: the big players are are very similar.
Speaker 5: But I was just going to say, you.
Speaker 1: Have these stock funds and these bond funds and balanced funds,
Speaker 1: but those can all also be index funds too.
Speaker 3: One of the questions that came up for me as
Speaker 3: I was reading through all of these different articles, wonder
Speaker 3: if you can help explain this jen they're using. They
Speaker 3: seem to be using the word securities in a couple
Speaker 3: of different ways that I can't totally. They're like securities
Speaker 3: like stocks, bonds, et cetera. And then sometimes they're like
Speaker 3: you buy securities, and maybe that is the same thing.
Speaker 3: But how are they talking about securities?
Speaker 4: What does that mean?
Speaker 1: So securities are the stocks per se. There is a
Speaker 1: probably a really technical definition. So the technical definition is
Speaker 1: a fungible, negotiable financial instrument that holds some type of
Speaker 1: monetary value. So it's just something that holds a value stocks, bonds.
Speaker 1: A mutual fund is a security because it's got stocks
Speaker 1: and bonds within it. An ETF, it's not a mutual fund,
Speaker 1: but it kind of runs the same way. So that
Speaker 1: is a security. It's it's a blanket term for all
Speaker 1: of these things. Okay, yeah, anything couls value, right right.
Speaker 1: I was like, well, now, what is a security? But
Speaker 1: it sounds like that's kind of an umbrella term that
Speaker 1: they're using.
Speaker 4: It is.
Speaker 3: Yes, yes, we kind of highlighted this already, but just
Speaker 3: to reiterate how mutual funds work. They are that pooled
Speaker 3: investment where lots of people are pulling their money mutually
Speaker 3: investing it into this fund to own shares. So mutual
Speaker 3: funds then do invest in many different companies. Once that
Speaker 3: money gets pulled, then it becomes invested, and some invest
Speaker 3: in even the entire stock market. As we've talked about before,
Speaker 3: though they can be invest in other things like bonds. However,
Speaker 3: when you buy shares in a mutual fund, you don't
Speaker 3: invest in those companies directly. You own shares in the fund,
Speaker 3: not the companies the fund selects. But hopefully it is
Speaker 3: a well managed fund. You've done your due diligence in
Speaker 3: picking your mutual funds, and so you, the investors, you,
Speaker 3: the ones who are mutually investing in this fund, will
Speaker 3: do well as those companies do well. But again, you
Speaker 3: don't own stock in it. You kind of, yeah, you own.
Speaker 1: And for most of us, we don't care about annual
Speaker 1: shareholder meetings or voting for these companies. Like I only
Speaker 1: own one single stock, I don't really care, and I
Speaker 1: don't really participate in any of its goings ons. But
Speaker 1: for the majority of us, we don't really care about
Speaker 1: that stuff. We're trying to just lower our risk while
Speaker 1: still taking enough risk to grow our money to have
Speaker 1: enough for retirement. So if that's you and you don't,
Speaker 1: you know, own a hedge fund or anything, then mutual
Speaker 1: funds can be really great. But there are pros and cons.
Speaker 1: So pros obviously, they diversify by investing in a large
Speaker 1: number of securities and they have low minimum investments, so
Speaker 1: sometimes like ten dollars, but normally around one thousand dollars
Speaker 1: to three thousand dollars. They are somewhat managed. We'll get
Speaker 1: into management in the next article. That's where we're gonna
Speaker 1: really spend a lot of our time. They're very liquid.
Speaker 1: Index mutual funds are one of the least expensive ways
Speaker 1: to invest, so there are a lot of pros. They
Speaker 1: are our favorite way to invest. Second is ETFs, which
Speaker 1: are very similar in all cover those in a second,
Speaker 1: but there are cons. So when we talk about mutual funds,
Speaker 1: not all mutual funds are created equal, right. Somebody can
Speaker 1: say mutual fund and be thinking one thing, and you
Speaker 1: could be thinking a totally different thing, and that comes
Speaker 1: up a lot. So while fees for some mutual funds
Speaker 1: may be low, like the index mutual funds, the expense
Speaker 1: ratios on other funds can be quite high, which can
Speaker 1: hinder your long term wealth building. And when mutual funds
Speaker 1: were created, I think back in the seventies, it was
Speaker 1: a fantastic way for the average mom and pop investor
Speaker 1: to be able to invest in the stock market without
Speaker 1: the risk of single stocks, without the risk of investing
Speaker 1: in businesses that may fall. Mutual funds really changed the game,
Speaker 1: and then index mutual funds changed the game again, and
Speaker 1: the Internet changed it for everyone. So it's just become
Speaker 1: more it's just become easier and less expensive to invest
Speaker 1: and safe and almost safer because of the diversification with
Speaker 1: every new technology that comes out in the financial sector.
Speaker 5: So it's fantastic.
Speaker 1: But we started with mutual funds, which when you're thinking
Speaker 1: about liquidity and safety versus risk, even with their high fees,
Speaker 1: they were still the way to go, like back in
Speaker 1: the eighties. So there are some people that still live
Speaker 1: by and fully support actively managed mutual funds, which you know,
Speaker 1: back in the eighties nineties not not a bad idea,
Speaker 1: but embracing technology and how it's evolved investing, you would
Speaker 1: be blind not to embrace that and so but because
Speaker 1: of that and because of those people that are still
Speaker 1: really attached to the old way, mutual funds can also
Speaker 1: lack transparency, so you won't you may not know exactly
Speaker 1: what's in them. Index funds, obviously are the exception. Every
Speaker 1: single index fund you go on Fidelity, Vanguard, Schwab, you're
Speaker 1: going to see exactly what's in there and the percentage,
Speaker 1: but if you're not investing directly through them, you may
Speaker 1: not be able to know that. Maybe a proprietary formula
Speaker 1: for what the fund, what's in the fund. And then
Speaker 1: mutual funds, unlike exchange traded funds, which can be bought
Speaker 1: and sold like stock, mutual funds can only be exchanged
Speaker 1: at the end of the day. Most people will not
Speaker 1: care about that. There are some tax advantages to exchange
Speaker 1: traded funds, so if you are very interested in lowering
Speaker 1: your your tax lowering your taxes, then than those would
Speaker 1: be something to look at. If not, then mutual funds
Speaker 1: are fined. And then this is probably the biggest one.
Speaker 1: Some mutual funds charge commissions.
Speaker 5: Those are called.
Speaker 1: Loads, So if you ever hear load, that's a commission
Speaker 1: in the mutual fund world, and that can seriously, seriously
Speaker 1: hurt your returns. So these are some of the pros
Speaker 1: and cons with mutual funds. I think the big takeaway
Speaker 1: here is not all mutual funds are created equal, and
Speaker 1: we want you to know the difference in mutual funds.
Speaker 1: So just one further note on ETFs. They work a
Speaker 1: lot like index mutual funds, so they'll track an index
Speaker 1: or an asset, and they can be bought and sold
Speaker 1: on the exchange. They are they're great. We would talk
Speaker 1: about index funds and ETFs kind of interchangeably, so whether
Speaker 1: if you already have ETFs in your portfolio, that's totally fine,
Speaker 1: it's not. They're passively managed, so I don't think you
Speaker 1: need to like go out and change your whole portfolio
Speaker 1: just because we're talking about mutual funds in this episode.
Speaker 3: It was also helpful for me to read throughout this
Speaker 3: article and probably some others about where you are even
Speaker 3: going to find your mutual funds, Like chances are if
Speaker 3: you have a four to oh one k IRA that
Speaker 3: you've invested in, mutual funds may be a part of that.
Speaker 3: So you can invest in mutual funds through your four
Speaker 3: roh one k your iras, your five twenty nine's. There's
Speaker 3: other options of where you can put your money. But
Speaker 3: that was a helpful marker for me to kind of
Speaker 3: understand because I wasn't sure as this kind of separate
Speaker 3: from retirement accounts. Mutual funds are what people are investing
Speaker 3: in just to like make a little bit of cash
Speaker 3: in the here and now, an investment or not in retirement,
Speaker 3: but I what I've come to learn is both, and
Speaker 3: you can engage in mutual funds in this way. But
Speaker 3: this is where another question came up for me, and
Speaker 3: I'm going to ask you Jen before we get into
Speaker 3: our second article. Will people invest in mutual funds? And
Speaker 3: I'm going to imagine this is like the non tax
Speaker 3: advantaged accounts just for Oh, I'd love to just invest
Speaker 3: some money and maybe have it grow and cash out
Speaker 3: out on it in five years. Is that also a
Speaker 3: way not just for retirement planning? Or how might people
Speaker 3: engage in mutual funds primarily or what are the options?
Speaker 5: Yeah? So I definitely so.
Speaker 1: Uh that's called like a traditional brokerage account of the
Speaker 1: account outside of your retirement accounts, And I definitely have
Speaker 1: index funds in my traditional brokerage account I like to
Speaker 1: play around with. So we didn't talk about all of
Speaker 1: the different types of funds, but there's also international, Uh,
Speaker 1: there is sector specific and I play around with kind
Speaker 1: of sector specific index funds. There are some maybe slightly
Speaker 1: actively managed, low cost funds that might have a like
Speaker 1: a point four or a point five percent expense ratio
Speaker 1: and that's the that's the fee that's the cost of
Speaker 1: buying it, whereas a lot of index funds will be like, gosh,
Speaker 1: below point one, So obviously that's much higher. But that's
Speaker 1: kind of where I'll play around with that. There are
Speaker 1: if you're interested in really really optimizing the tax strategy
Speaker 1: of a taxable brokerage. That's not my expertise. I only
Speaker 1: really think about investing in for retirement, but I do
Speaker 1: play around outside of me. Yes, all of I mean
Speaker 1: I have one, the single stock, but like most of
Speaker 1: it is, most of my taxable brokerage is in mutual funds.
Speaker 3: Can you have a taxable brokerage fund like through your
Speaker 3: Vanguard Fidelity that kind of thing.
Speaker 1: Mm hmmm, yes, you can have both. It's definitely. So
Speaker 1: most places, like if you're thinking about like investing apps
Speaker 1: like robin Hood and Acorns and stuff like that, they
Speaker 1: would all be taxable brokerage.
Speaker 5: I think.
Speaker 1: Now some of them you can open a retirement account,
Speaker 1: but most everything is considered taxable brokerage. Only the reputable
Speaker 1: like places robo advisors and stuff, are going to have
Speaker 1: the retirement accounts. So yes, everyone offers a like a
Speaker 1: tax taxable brokerage account, it's only the reputable places that
Speaker 1: offer retirement accounts, so that's yeah.
Speaker 5: If it doesn't.
Speaker 1: And my rule of thumb, if the app or whatever
Speaker 1: fintech thing that you want to try investing in, if
Speaker 1: it does not offer a roth IRA option, don't touch it.
Speaker 1: Don't touch it. It's not established enough, it's not worth it.
Speaker 1: And if you're not maxing out you're roth IRA, don't
Speaker 1: touch a taxable brokerage there. You should be maxing out
Speaker 1: all of your retirement accounts before you play with a
Speaker 1: taxable brokerage. The only money I have in a taxable
Speaker 1: brokerage was money I put in there from when I
Speaker 1: was maxing out my four oh one K and roth
Speaker 1: IRA options, so I do and I no longer put
Speaker 1: money in that taxable brokerage. That was literally from that season,
Speaker 1: and that money is just sitting there. So yeah, that's
Speaker 1: another highly suggest don't play around with taxable brokerages until
Speaker 1: you've maxed out all your retirement like tax advantaged options.
Speaker 3: Beautiful, so so helpful. The next article is from Investipedia.
Speaker 3: Love it so the bank rate Investipedia, they're really doing
Speaker 3: it on explaining these things. So this one is mutual funds,
Speaker 3: different types and how they are priced. So helping us
Speaker 3: get a little bit more into the nitty gritty now
Speaker 3: that we know.
Speaker 4: What mutual funds are.
Speaker 5: Mm hmmm, yes, and so you'll have mutual funds.
Speaker 1: We already went into the different types, and you'll see
Speaker 1: those in your retirement accounts. I forgot to mention this,
Speaker 1: uh in the last article. But in a lot of
Speaker 1: four oh one k's, especially if you work for a
Speaker 1: smaller company, you are going to see those actively managed
Speaker 1: mutual funds in a lot of four oh one k's,
Speaker 1: a lot of four oh three b's.
Speaker 5: If you're a teacher, I'm.
Speaker 1: So sorry here, your four oh three b probably isn't
Speaker 1: in It's probably in a high feme actively managed fund.
Speaker 1: Not always, but a lot of the times, unfortunately, you
Speaker 1: know all so a lot if you're working for a
Speaker 1: large company and your you know, four oh one K
Speaker 1: is through like a like a Fidelity or a Vanguard
Speaker 1: or a Schwab like your set. So a lot of
Speaker 1: large companies use these, you know, the ones that we love.
Speaker 1: But definitely check your four oh one K, four O
Speaker 1: three B et cetera, et cetera to see what the
Speaker 1: fees are and then you know, should I be prioritizing
Speaker 1: my IRA or my four a one K, Well, definitely
Speaker 1: if you have I mean, you're still going to save
Speaker 1: money in taxes in investing in a high fee uh
Speaker 1: four oh one K mutual fund versus a taxable brokerage.
Speaker 1: So again what I said stands, don't touch the taxable
Speaker 1: brokerages until you've maxed out your retirement, regardless of the
Speaker 1: options you have. But if you're thinking, like should I
Speaker 1: be investing in my IRA or my four oh one k,
Speaker 1: it's time to look at the fees and what kind
Speaker 1: of mutual fund is in your four oh one k
Speaker 1: to decide that.
Speaker 5: Uh So?
Speaker 1: But yeah, I love Investipedia. It is where I cite
Speaker 1: when I wrote. When I've was a retirement writer, I
Speaker 1: would cite them all the time, and I think, I, yeah,
Speaker 1: I wrote for them for a couple months in a
Speaker 1: in a dream writing gig. So wow, I really yeah,
Speaker 1: I like this one. When did you think of this one?
Speaker 5: Y'all?
Speaker 4: Yeah?
Speaker 3: Super helpful again, just kind of taking the next steps
Speaker 3: beyond what a mutual fund is, really helping you to
Speaker 3: understand it, because I do think while you may not
Speaker 3: be you may be like me and you don't want
Speaker 3: to know how to read the music. Who cares if
Speaker 3: you can play the instrument, But it can certainly help.
Speaker 3: Any knowledge that we're willing to keep taking in can
Speaker 3: help inform us better in making even better decisions with
Speaker 3: what we're investing in. So specifically, we want to look
Speaker 3: at how are they priced, what can we expect with this?
Speaker 3: So it's helpful to understand that the value of a
Speaker 3: mutual fund depends on the performance of the securities in
Speaker 3: which it invests. So again, if it's investing in stocks
Speaker 3: or bonds, how well those securities are performing, we'll dictate
Speaker 3: how well the mutual fund performs. So when you buy
Speaker 3: a UNI or a share of a mutual fund, you,
Speaker 3: as the investor, are buying the performance of its portfolio.
Speaker 3: Said more specifically, it's a part of the portfolio's value.
Speaker 3: So investing in a share of a mutual fund is
Speaker 3: different from investing in shares of stock, which we already
Speaker 3: talked about. So the price of a mutual fund share
Speaker 3: is referred to as the net asset value or nav
Speaker 3: NAV per share, sometimes expressed as is it navps. Is
Speaker 3: that how people would say that navps. So a fund's
Speaker 3: NAV is derived from dividing the total value of the
Speaker 3: securities in the portfolio by the total amount of shares outstanding,
Speaker 3: and so those outstanding shares is referring to those held
Speaker 3: by all shareholders, institutional investors, or company officers or insiders
Speaker 3: of the company.
Speaker 4: So that's how a.
Speaker 3: Mutual fund is priced. I mean, we're not giving you
Speaker 3: a exact numbers, but this is kind of how they're
Speaker 3: going to determine what your cost is to buy into
Speaker 3: the mutual fund. As Gen shared earlier, it could be
Speaker 3: as low as ten dollars upwards to three thousand, but
Speaker 3: still much more accessible for the common person than what
Speaker 3: it would be to maybe invest in like a single
Speaker 3: stock or another type of investment.
Speaker 5: Yeah.
Speaker 1: Yeah, Ultimately, we don't care about the NAV price you
Speaker 1: might go. So I'm looking at the Vanguard Total Stock
Speaker 1: Market Index Fund VTSAX, which I own a lot of,
Speaker 1: and the NAV price is one hundred and eight sixteen.
Speaker 1: I never once have looked at the price per quote
Speaker 1: unquote share. It doesn't matter. The thing that matters the
Speaker 1: actual cost of investing into the fund is the expense ratio,
Speaker 1: and the expense ratio is point oh four percent, and
Speaker 1: so you can actually get a zero percent expense ratio
Speaker 1: with Fidelity. I forget that it's just the Fidelity zero
Speaker 1: their total stock market index fund. But people might say, like,
Speaker 1: why why is that one have you know zero A.
Speaker 1: It gets people on the platform, on the Fidelity platform,
Speaker 1: and B they have money, you know, in their pool,
Speaker 1: you know, to fund whatever they do with the money.
Speaker 1: So so that's why Fidelity gives you know, expense ratio
Speaker 1: free total stock market funds. But VTSA X that's that's
Speaker 1: the one I own a lot of.
Speaker 5: We also have.
Speaker 1: Stock index funds at Fidelity too. So but let's talk
Speaker 1: about the management costs. So let's dive a little deeper
Speaker 1: into this actively and passively managed. What's the difference. So
Speaker 1: we said before the index funds, they are passive.
Speaker 4: So this is where the.
Speaker 1: Mutual fund literally is just set up in the exact
Speaker 1: ratio to mimic an index kind of like the SMP
Speaker 1: five hundred. So that's the five hundred largest companies in
Speaker 1: the stock market, and so it's got the fund has
Speaker 1: all pretty much all five hundred of those stocks. Sometimes
Speaker 1: I think it may have like four ninety eight or
Speaker 1: four ninety nine, I don't know. Sometimes it's weird, but Basically,
Speaker 1: it's all five hundred of those companies kind of in
Speaker 1: the ratio that they make.
Speaker 5: Up the SMP five hundred index.
Speaker 1: So that's that, and the strategy setting it up that
Speaker 1: way requires less research from analysts and advisors. You don't
Speaker 1: have to actively management. You can set it up on
Speaker 1: an algorithm, and so there are fewer expenses and that
Speaker 1: saving is passed on to investors. And so index funds
Speaker 1: typically average around point four to four percent in fees,
Speaker 1: but many are less than point one percent.
Speaker 5: A lot.
Speaker 1: If you invested in index funds with a robo advisor,
Speaker 1: which is kind of that mid point between I don't
Speaker 1: want to do it myself, but I don't want to pay,
Speaker 1: you know, hundreds of dollars to use a financial planner,
Speaker 1: I will use a robo advisor, and that you'll see
Speaker 1: about point two five percent in an expense ratio. In addition,
Speaker 1: some are in addition to the actual expense ratio of
Speaker 1: the index fund. So that's like that middle section. So
Speaker 1: definitely I would say keep your expense ratios below point
Speaker 1: twenty five as a rule of thumb. It's not like
Speaker 1: a hard and fast rule, but you absolutely can actively
Speaker 1: managed funds on the other hand, they have a lot.
Speaker 5: A lot of fees.
Speaker 3: Wo.
Speaker 5: Yeah.
Speaker 1: So because they're actively managed with these proprietary ratios of
Speaker 1: stocks and bonds. So you're gonna have these loads commissions
Speaker 1: that pay the fund manager. That's called a front end
Speaker 1: load of up to five percent, plus management fees for
Speaker 1: the ongoing management. You're going to have ongoing fees for distributions,
Speaker 1: which actually aren't that those are not uncommon. But that's
Speaker 1: all in addition. And then my favorite fee that I
Speaker 1: have ever heard, fait.
Speaker 5: This is my absolute favorite.
Speaker 1: This is my favorite fee. This is the twelve b
Speaker 1: dash one fee. And I love that they put this
Speaker 1: on your like the info sheet, right because it's twelve
Speaker 1: B dash one fee.
Speaker 5: Who's going to question that?
Speaker 4: How could you?
Speaker 1: Good?
Speaker 6: Right?
Speaker 3: So much letters and numbers and dashes.
Speaker 1: Right, what is a twelve bee? So it's capped at
Speaker 1: one percent, so it seems very inconspicuous. It is literally
Speaker 1: the fee that pays for the cost of marketing and
Speaker 1: selling the fund and other shareholder services.
Speaker 5: It's a marketing fee.
Speaker 4: Wow.
Speaker 1: So and then you've got other fees like custodial, legal, accounting,
Speaker 1: transfer agent, all that stuff, but like to pay to
Speaker 1: market the fund. I want to have a good fund,
Speaker 1: it should market itself.
Speaker 3: I want to have a twelve b dash one fee
Speaker 3: anytime I want money from somebody, what's it for?
Speaker 4: Twelve dush one?
Speaker 1: Can't question twelby dush one. Yeah this and write in
Speaker 1: on our taxes, what's this expense? Oh, twelvey dush one.
Speaker 5: It's marketing.
Speaker 3: It's like stamps. The cost of stamps when I bought
Speaker 3: my house that car.
Speaker 1: So yeah, and there is a there's a special there's
Speaker 1: there's a special website on the internet that loves actively
Speaker 1: managed fees. And they went as far as to write
Speaker 1: an article on this website that shall not be named
Speaker 1: but like a cow to avoid outrageous mutual fund fees,
Speaker 1: which is hilarious. But and so they list out all
Speaker 1: the fees that actively managed funds have front end load,
Speaker 1: back end load, level load, and then no load. So
Speaker 1: no load is no commission, and they're like load first,
Speaker 1: no load, which one's better. You might be looking at
Speaker 1: the list and thinking no commission or sales charge, sign
Speaker 1: me up. But for example, a no load fund may
Speaker 1: charge up to one percent in marketing and services called
Speaker 1: twelve B one fees, which is less true than the
Speaker 1: right the load fees definitely charge a fee. Well, I
Speaker 1: can't say one hundred percent, but I I know from
Speaker 1: experience that they definitely like the ones I've seen, definitely
Speaker 1: do and that doesn't sound too bad. But it just
Speaker 1: goes on to say how much one percent can eat
Speaker 1: away And they say, you might not realize how much
Speaker 1: your no load fund is costing you until you've been
Speaker 1: invested in it for years. You do only know it
Speaker 1: then if you're keeping an eye on your costs and
Speaker 1: comparing them to other funds, and it just I love it.
Speaker 1: I could read the whole thing and just like crack
Speaker 1: up about how they compare it to a car and
Speaker 1: keeping a long term view. But essentially they're trying to
Speaker 1: convince you that paying somebody to manage and market a
Speaker 1: fee is going to make you more in the long run.
Speaker 1: And I think the only thing that investors, financial planners, writers,
Speaker 1: everybody in the world is trying to tell everybody except
Speaker 1: for this website, is that you can't predict the market
Speaker 1: like you can create a mutual fund that is for
Speaker 1: sure going to outperform the market.
Speaker 5: Nobody can be sure of that.
Speaker 1: There's no way unless you have a gift, the gift
Speaker 1: of foresight, that you can create and actively manage a
Speaker 1: mutual fund that is guaranteed in the long run to
Speaker 1: outperform the market. That's the only thing that we know.
Speaker 1: So if you created a fund that just mimics the market,
Speaker 1: because we have that data that it that if you
Speaker 1: just leave it and let it go with the market,
Speaker 1: that you will more often than not achieve the same
Speaker 1: or better results as actively managed funds and you.
Speaker 5: Avoid all the fees.
Speaker 1: So those studies have been done time and time again,
Speaker 1: and just know that you nobody even if you watching
Speaker 1: the market all the time. I ask anybody in early
Speaker 1: twenty nineteen if they saw twenty twenty one coming twenty
Speaker 1: twenty twenty twenty two, like if they saw this coming
Speaker 1: in in not if they saw it coming, but if
Speaker 1: they saw it coming in the exact years it came.
Speaker 3: Yeah, it's it's good. And you know what I can
Speaker 3: always see coming. It's predictable, consistent, very low to no load,
Speaker 3: no fees, no load. The bill of the week.
Speaker 2: That's right, it's time for the best minute of your
Speaker 2: entire week. Maybe a baby was born and his name
Speaker 2: is William. Maybe you paid off your mortgage. Maybe your
Speaker 2: car died and you're happy to not have to pay
Speaker 2: that bill anymore. Dust bills, but blow bills, bill clean.
Speaker 4: This is the bill up the week.
Speaker 7: Hey guys, this is Megan from Alatchua, Florida. My Bill
Speaker 7: of the week highlights values based spending and if that
Speaker 7: sounds familiar, it's because I learned it from listening to
Speaker 7: your podcast, which I love. By the way, so I
Speaker 7: own a small cleaning business, which means that I'm on
Speaker 7: my feet a lot. So I finally broke down and
Speaker 7: decided to invest in a really comfortable, orthopedic pair of
Speaker 7: shoes which were on the spendy side. I'm not in
Speaker 7: my twenties anymore Heads Up thirties or the New fifties,
Speaker 7: but once I splurged then I've found that since wearing them,
Speaker 7: they're worth every penny. So thank you again, guys. Also,
Speaker 7: it's a side note, Gainesville, Florida has a real king.
Speaker 7: Didn't know if you guys knew that. I know you'd
Speaker 7: mentioned it on a previous episode, but if you ever
Speaker 7: felt like doing a road trip, you could head up
Speaker 7: north work to the whys. It's basically like tractor supplies,
Speaker 7: bigger uglier cousin just heads up, all right, thank you guys.
Speaker 5: Love the podcast so so much.
Speaker 1: In that first shoes, yes, love, actually looking for my
Speaker 1: own pair of feel good feet shoes and thinking about splurging.
Speaker 1: So yes, thirties love. And then also Rural King. I
Speaker 1: don't know when I would ever go to Gainesville, but
Speaker 1: the fact I mean Rural King piggies it's got me.
Speaker 3: So I still don't think I know what that is.
Speaker 3: Had you referenced that, Jen.
Speaker 5: We yeah, so we talked about it.
Speaker 1: I went on a cruise and everyone was talking about
Speaker 1: their pets, and the people at our table had just
Speaker 1: very weird pets, like not weird, but just bizarre, like
Speaker 1: lovely bizarre. One had a skunk and the other had piggies.
Speaker 1: And she was talking about how she got the piggies
Speaker 1: as an impulse by from Rural King.
Speaker 5: And I stopped her and I was like, tell me
Speaker 5: about Rural King.
Speaker 4: Oh, we can visit it.
Speaker 3: And Megan in her comfy footwear, Wow, well.
Speaker 5: Done, well, well done.
Speaker 1: Yes, And that's a business expense if you wanted to
Speaker 1: expense it.
Speaker 3: It's a business expense, yeah, oh exactly, yes, Well, because
Speaker 3: taking care of your feet, I think is taking care
Speaker 3: of the rest of your body. And this is something
Speaker 3: I've come to know in my sixties, which is my thirties,
Speaker 3: that you can't just wear the fashionable footwear. It's got
Speaker 3: to be it's got to make sense, you know, it's
Speaker 3: got to support you. It's got to support the activities
Speaker 3: you do all day. Otherwise it's back pain and more
Speaker 3: for us. So I support you. Well done. Hope that
Speaker 3: cleaning business is going well.
Speaker 4: If you all.
Speaker 3: Listening, are please to spend on your comfort and that's
Speaker 3: where you are implementing some values based spending. Or your
Speaker 3: name is Bill and you own a rural King, wouldn't
Speaker 3: that be.
Speaker 2: King?
Speaker 3: I'm pretty sure that that is. That's a real that's
Speaker 3: a real situation. So is friendspodcast dot com splash Bill.
Speaker 3: We can't wait to listen to it. And now it's
Speaker 3: time for pe.
Speaker 1: Take find a friend named Bill and take him to
Speaker 1: Rural King and record the bill at Rural King. That
Speaker 1: is my charge, wow to you our community.
Speaker 4: How long until that happens?
Speaker 1: I don't know, Probably never. What's your still can't get
Speaker 1: a person named Bill to call? Our listening audience is
Speaker 1: mail and none of them are named Bill.
Speaker 3: It's the joke I believe our entire community is playing
Speaker 3: on us. They're all like, oh yeah, for sure, I've
Speaker 3: got a family member named Bill. But it's just funny
Speaker 3: to make them beg and plead year over year for
Speaker 3: just a person named Bill.
Speaker 1: Year after Oh wow, we're gonna have to go out
Speaker 1: to like like the that Netflix show of the Magic
Speaker 1: Guy where he goes magic for Susan's and we're gonna
Speaker 1: have to like go on the street and find bills
Speaker 1: like the bill of the week. One day, maybe when
Speaker 1: we're doing book prom.
Speaker 3: I'll be more excited to meet a person named Bill
Speaker 3: than to find like a dollar bill on the ground.
Speaker 4: For sure.
Speaker 1: Okay, Lightning round, what's your quote unquote lesson learned the
Speaker 1: hard way from your savings and investment.
Speaker 3: It's too vulnerable, but I have shared it on the
Speaker 3: podcast so far, so I'll say it again because hopefully
Speaker 3: it'll help one of you who's listening. I thought I
Speaker 3: was doing so good years ago.
Speaker 4: Still, though when we start, I didn't.
Speaker 3: I did not begin investing for retirement until after Jen
Speaker 3: and I started this podcast. It took me a while
Speaker 3: because at first I was just like, Yay, I'm getting
Speaker 3: out of debt and learning how to manage my money.
Speaker 3: That seems good enough, and that is it's great. And
Speaker 3: then it was like, oh, okay, there's another step I
Speaker 3: can be investing now. So I thought I was doing it.
Speaker 3: I opened up a Vanguard account. Actually I made two mistakes.
Speaker 3: Oh my okayly reality, open up a Vanguard account roth
Speaker 3: Ira because our combined household income doesn't we were allowed
Speaker 3: to have a roth Ira bonus points.
Speaker 4: And I did all of it right.
Speaker 3: I even I even designated a what do they call it,
Speaker 3: someone who gets your money after you die.
Speaker 5: A beneficiary, thank you.
Speaker 3: I even I did all of that, which I've heard
Speaker 3: a lot of people skip over, but you know, and
Speaker 3: I put money in it.
Speaker 4: I what I thought.
Speaker 3: I funded it, I thought, But what I failed to
Speaker 3: do was invest it. So I set up my whole
Speaker 3: bank account move the money over. I even set up
Speaker 3: automatic deposits, so money kept going over into Vanguard month
Speaker 3: over month.
Speaker 4: For at least a full year.
Speaker 3: And then I heard Jen say something about a common
Speaker 3: mistake people make is opening up an account, putting money
Speaker 3: into it, and then never actually investing it. I'm like, ahaa,
Speaker 3: those silly folks. And then I was like, wait a second,
Speaker 3: have I done that? I don't know if I've done that,
Speaker 3: look looked into it, sure enough, didn't And it still
Speaker 3: took me probably like a whole month to even come
Speaker 3: to you, Jen, to be like, what do I have
Speaker 3: to do now?
Speaker 4: I think this is me and I think.
Speaker 3: This has been me for a whole year, because that's
Speaker 3: where all those funky numbers come into play. That those
Speaker 3: numbers not numbers letters that Jen was listing, like the
Speaker 3: vs FX A T T see why whatever whatever comes in.
Speaker 3: If if that doesn't sound familiar to you, like needing
Speaker 3: to pick a series of upper case letters, then you've
Speaker 3: not invested yet. So that's got to be part of it.
Speaker 3: The second mistake that I made with this Ratha Hara
Speaker 3: is I thought, I don't know you guys. I didn't
Speaker 3: think about it that much. This is the whole like
Speaker 3: I don't learn how to read music. I just play music,
Speaker 3: which also isn't true for me. But I, for whatever reason,
Speaker 3: thought that this was kind of like a shared thing
Speaker 3: for my husband and I, that this is our shared
Speaker 3: retirement account, and that you could kind of only have
Speaker 3: like one per household. No, each person can have their
Speaker 3: own ROTH Ira. Each person should have their own roth Ira.
Speaker 3: So it was like even another year after that that
Speaker 3: I realized this, like I gotta get Eric roth Ira.
Speaker 3: So then I knew to actually invest the money. Here
Speaker 3: we are, so learn from my mistakes. I'll be your
Speaker 3: bernstain bear.
Speaker 1: I can't believe that I wouldn't say that both of
Speaker 1: you should have one. Yeah, I feel so like religiously
Speaker 1: adamant that everyone should have their own wroth Ira.
Speaker 3: Well yeah, you probably just whoever else would think that
Speaker 3: it's just kind of one per household. It wasn't necessarily
Speaker 3: that you kept info from me. It's just whatever I
Speaker 3: didn't even think to think about.
Speaker 1: Yeah, yeah, I mean, which is easy to think when
Speaker 1: you're it's definitely like it's tax advantage, so you think
Speaker 1: it's tied to your taxes. If you're married filing jointly
Speaker 1: in your taxes, you think one rather ray, thank you,
Speaker 1: But it's.
Speaker 5: Not the case.
Speaker 1: Everyone can and should have their own rath theory, even
Speaker 1: if you are a stay at home spouse with no
Speaker 1: earned income. If you are married filing jointly, and this
Speaker 1: is where the one thing where it does tie to
Speaker 1: your taxes, if you're married filing jointly and your spouse
Speaker 1: has taxable income, then the unworking spouse is eligible for
Speaker 1: their own roth IRA. Should you guys, should you meet
Speaker 1: the income threshold? So yes, absolutely, and yeah we got
Speaker 1: to figured out investing part. That's why there's another reason
Speaker 1: why it's important to know what a mutual fund is
Speaker 1: and to know kind of that farmer's market. Like if
Speaker 1: your four oh one K or your roth IRA is
Speaker 1: the city, your city has to have things in it
Speaker 1: and the and the you know, the farmer's market. You
Speaker 1: can't just put money into it and then it just
Speaker 1: sits there. It's got to be put into something. And
Speaker 1: that is the mutual fund, the index fund. So you
Speaker 1: got to buy. You got to buy the index fund,
Speaker 1: and the the conduit to get there is just the account.
Speaker 1: So definitely easy mistakes. I wrote too on here, Sames.
Speaker 1: So one was an actual mistake and one was an
Speaker 1: almost mistake. So my actual mistake was I actually forgot
Speaker 1: to invest money I put into an IRA into a
Speaker 1: four oh one k rollover. So I put money into
Speaker 1: I did a four to one k rollover. And this
Speaker 1: is why we love Capitalize Frugal friendspodcast dot com slash
Speaker 1: Capitalize We love Capitalize because they do four oh one K,
Speaker 1: four three B you know all those They do rollovers
Speaker 1: into iras for you. It's a rollover concierge. It's free.
Speaker 1: They just make a commission if you choose, like you know,
Speaker 1: a certain brokerage or roboadvisor, but you don't have to.
Speaker 1: So we love them because I personally did a four
Speaker 1: oh one k rollover myself as a retirement expert and
Speaker 1: let that money just there. Granted I was having a
Speaker 1: baby and so I didn't look at my investment like
Speaker 1: I did the rollover, and then just didn't look at
Speaker 1: anything for a year because I had a newborn. But
Speaker 1: when I did check in and realized, oh my god,
Speaker 1: I am so dumb, I made the mistake I tell
Speaker 1: other people not to make. So that was my biggest
Speaker 1: I lost a whole year and it was a lot
Speaker 1: of money. I lost a whole year of growth on that.
Speaker 1: And it was twenty eighteen, so it wasn't the best
Speaker 1: year for investments, but you know, won the worst. So
Speaker 1: that's my biggest and my almost mistake was I almost
Speaker 1: got into an actively managed fun so when I knew
Speaker 1: nothing about investing, we had just finished off paying our debt,
Speaker 1: and I was like, Okay, the next step is to
Speaker 1: have somebody invest my money for me.
Speaker 5: That's just what I thought.
Speaker 1: And so we've sought out somebody to manage our money
Speaker 1: for us. And I'm sitting through this sales pitch and
Speaker 1: I'm like, why is it a sales pitch?
Speaker 5: Why am I here for so long?
Speaker 1: Like I don't understand this is I I didn't know
Speaker 1: anything about investing, but the sales pitch just gave me
Speaker 1: skeezy vibes. And this was like we knew this person.
Speaker 1: It's not like this was a stranger to us. This
Speaker 1: was actually a friend of ours that did this and
Speaker 1: we sought them out and to do this. And so
Speaker 1: from the sales pitch, I then I started researching on
Speaker 1: YouTube ways to invest your money. That is what led
Speaker 1: me to This was to twenty seventeen, So this was
Speaker 1: like six months before we started the podcast. I was
Speaker 1: not into podcasts, but this is what led me to
Speaker 1: stacking Benjamins afford anything. This is what led me to
Speaker 1: the simple path to wealth and literally, you know, kind
Speaker 1: of saved me from making this mistake.
Speaker 5: And I almost I went.
Speaker 1: As far as saying I will because I was already
Speaker 1: writing about personal finance at this point, but I was
Speaker 1: writing about debt payoff and saving money and making money.
Speaker 1: I was not writing about investing. And so I had
Speaker 1: like kind of a foothold in the personal finance community,
Speaker 1: but by no means in the investing or financial independence community.
Speaker 1: And that's what started me as that initial research. And
Speaker 1: I went as far as to call our friend and
Speaker 1: be like, hey, you can manage Travis's money, but I
Speaker 1: think I'm gonna do my own thing. And he's like, well, actually,
Speaker 1: we would prefer to do couples together, so we won't
Speaker 1: do one or the other. And I was like, okay,
Speaker 1: well then you're gonna do neither.
Speaker 5: And that's how I got it out of it.
Speaker 3: And that's because I lose friends and make money.
Speaker 1: Yeah, But because he was a friend and I didn't want,
Speaker 1: you know, like to just ship him. I felt like
Speaker 1: he had already invested all this time in the sales pitch,
Speaker 1: which I didn't realize what it was initially, I just
Speaker 1: and I knew it, felt I couldn't name it. And
Speaker 1: now I know what. Now I know the name.
Speaker 5: It's a sales pitch.
Speaker 1: It's that twelve B dash one fee if it's free,
Speaker 1: you're still paying for it, because nothing is free. That
Speaker 1: two and a half hour, three hour long, god, it
Speaker 1: was so long sales pitch that I sat in there
Speaker 1: for where they were not being quote unquote paid. It's
Speaker 1: that twelve b dash one fee at work. Other people
Speaker 1: were paying for that.
Speaker 5: So yeah, I.
Speaker 1: Really dodged a bullet on that one, and I hope
Speaker 1: that you guys will dodge stain bullet.
Speaker 3: Thanks so much for listening everyone. We love sitting here
Speaker 3: with you, learn in, having fun, laughing. You know what else,
Speaker 3: We love reading your reviews. That's so fun. Many of
Speaker 3: you are giving us such kind, thoughtful, enjoyable reviews like
Speaker 3: this one from Jams Jample. Love that, love reading that
Speaker 3: and saying that out loud, practical and encouraging. I listen
Speaker 3: to every episode of this podcast and really enjoy these ladies.
Speaker 3: I find it encouraging and full of practical tips for
Speaker 3: helping me stay on course with my financial goals. Thanks
Speaker 3: Jen and Jill, you are welcome, Jams Jample, thanks listening.
Speaker 1: Thank you Jamps Jample. Yes, if you enjoyed the show,
Speaker 1: please take a minute to leave a rating and review.
Speaker 1: It helps potential new listeners. Know what our show is about.
Speaker 1: So if they're looking for a retire early invest all
Speaker 1: your money in complex strategies and stalks, this is not
Speaker 1: the show for them.
Speaker 4: They'll know that. See y'all next time.
Speaker 5: Gorugle Friends is produced by Eric Sirianni.
Speaker 4: Jill tell Me.
Speaker 5: Let's okay?
Speaker 1: Did I tell you about the running shoes, the new
Speaker 1: running shoes that I bought?
Speaker 3: Yes, that you got them on sale, but you're putting
Speaker 3: them aside until you're ready and need them?
Speaker 4: Yes?
Speaker 1: Did I tell you the whole story about them?
Speaker 4: Maybe not go for it?
Speaker 5: So this megan.
Speaker 1: Our bill of the week reminded me of this, And
Speaker 1: I was in the running store on our anniversary weekend.
Speaker 1: I had to have told this on the show.
Speaker 5: Have I not that we were on?
Speaker 1: So our anniversary weekend, We're in a running store and
Speaker 1: I see the running shoe that I usually run at
Speaker 1: run in on sale for like half off, and I'm
Speaker 1: like what, And they're the exact shoes, Like this is
Speaker 1: no compromising. I'll pay one hundred and fifty bucks for
Speaker 1: shoes like to run in no problem. Once a year,
Speaker 1: I'll drop it because yes, having good shoes is important,
Speaker 1: and here they are like the shoes I run in
Speaker 1: and they're half off, and I'm like, please, may I
Speaker 1: try I don't need new running shoes right now, but
Speaker 1: I can't, you know, pass these up. And the I
Speaker 1: try them on and I'm like, oh, they're perfect. I'm
Speaker 1: getting them, you know, and I'll just set them aside.
Speaker 1: And the guys like, you know why they're half off?
Speaker 1: And I was like, no, you did, Like, there's nothing
Speaker 1: wrong with them. They're brand new. It's because they're the
Speaker 1: Gold Edition and they misspelled gold.
Speaker 4: Yep, yep.
Speaker 6: We did talk about the shoe back to me, Yes, okay,
Speaker 6: so but I say, I feel like yes because the
Speaker 6: shoe actually says glod. So I've been calling them my
Speaker 6: glods and I can't wait to wear them. They feel
Speaker 6: so comfortable and I love, I love. I put them
Speaker 6: on the top of my closet and I just get
Speaker 6: to look at my glods every morning.
Speaker 3: What a good year that's gonna be when you're when
Speaker 3: you're in your glod year?
Speaker 5: Yeah, next year?
Speaker 1: Next year is my glad ye god, this is so,
Speaker 1: this is our Jordan year. Everybody seems to forget it's
Speaker 1: twenty twenty three. This is your Jordan year. Like normally
Speaker 1: we say when you're twenty three years old, but no,
Speaker 1: this is everybody's Jordan year and it's you only got
Speaker 1: a few weeks left. Make it the best because this
Speaker 1: is the last Jordan year you're.
Speaker 4: Getting live ever and glad.
Speaker 1: Then if you're lucky, you can have a glod year gold,
Speaker 1: but not everybody.
Speaker 5: It's a globier