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Speaker 1: Welcome to Out of Money. I'm Joel, I'm Att, and

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Speaker 1: today we're answering your listener questions.

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Speaker 2: That's right, buddy, we have some very specific personalized money

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Speaker 2: questions to get tuesday. We're not just talking in the abstract.

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Speaker 2: We're not talking about the theoretical, but we're talking about

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Speaker 2: how personal finances are personal for you as an individual.

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Speaker 2: So we've got uh.

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Speaker 1: We'll say, by the way, when we take these questions,

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Speaker 1: the great thing is like there's hopefully a lot of

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Speaker 1: advice targeted towards the person asking the question, but.

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Speaker 2: Learn general advice. But I guess all the personal details.

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Speaker 2: That's what makes it fun, that's what adds all the color.

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Speaker 2: That's why I love and Yeah. A listener is wondering

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Speaker 2: if they should make the car insurance claim, to make

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Speaker 2: the car insurance claim, Joel, or to not make the

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Speaker 2: car insurance claim. How about that? That is the question,

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Speaker 2: very Shakespeare and that we're going to answer today. Another

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Speaker 2: listener is wondering when whether or not filing for bankruptcy,

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Speaker 2: if that is going to be the best option for them.

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Speaker 2: And another listener has essentially the opposite problem, what to

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Speaker 2: do if you are over the FDIC limit within their

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Speaker 2: savings accounts. So we'll get to those plus a couple

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Speaker 2: others today.

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Speaker 1: The short answer, get a scrooge mcdug fault, toss it

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Speaker 1: all in there, swim in the money. I would say,

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Speaker 1: if you got that kind of cash going on, we'll

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Speaker 1: get to that more in just a second of speaking

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Speaker 1: though mat of savings accounts and potentially having too much

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Speaker 1: on hand. One listener, Molly, she reached out via email

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Speaker 1: recently and she mentioned the wealth Front cash account and

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Speaker 1: I hadn't really thought of this, but it is true

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Speaker 1: that a lot of save these accounts that pay the

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Speaker 1: highest rates have some slightly onerous restrictions, right like, for instance,

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Speaker 1: my Discover account, they.

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Speaker 2: Have the most scrooge like restrictions. Perhaps, yeah, they don't

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Speaker 2: want you trying to continue with things good. We can

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Speaker 2: keep going that as long as you want. They basically

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Speaker 2: won't allow you to do more than say, transactions in

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Speaker 2: a given month out of that account. So if you

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Speaker 2: wanted to, let's say, pay your mortgage and pay your

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Speaker 2: credit card bill and pay everything essentially out of that

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Speaker 2: savings account, well sorry, at some point they're gonna slap

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Speaker 2: your wrists and say no, no, can do so then

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Speaker 2: you got to transfer money from savings into checking and

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Speaker 2: it's a thing, right, it's just kind of annoying. Well,

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Speaker 2: these more modern banks or neo banks, right who are

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Speaker 2: paying high rates of interest, wealth Front being one of them.

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Speaker 2: Betterment has another account that's paying north of five percent

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Speaker 2: right now, Well they're allowing for unlimited withdrawals from these

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Speaker 2: account accounts. And it made me think like, oh, yeah,

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Speaker 2: you don't even have to really redik about that. It

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Speaker 2: reduces some of that friction. Yeah, you want to.

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Speaker 1: Stop moving is sending money from one MAK account to

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Speaker 1: another all the time. You can literally just keep all

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Speaker 1: your money in that high interest account and then have

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Speaker 1: all your transactions coming out out of that. That would

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Speaker 1: simplify things. So yeah, great tip for Malli. And it

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Speaker 1: makes me think I'm going to reorder some things in

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Speaker 1: my own life just because yeah, I hate moving stuff

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Speaker 1: around all the time and being like when's that coming

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Speaker 1: out of that account?

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Speaker 2: I don't mind on that much personally. Yeah, So here's

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Speaker 2: my issue is in uh, you call this superstition, you

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Speaker 2: call this being ill informed, Just put your lucky rabbits

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Speaker 2: foot in your podect I. Personally, I don't like for

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Speaker 2: any other institution out in the ether to know my

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Speaker 2: actual savings account number. The only basically the only account

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Speaker 2: that is linked to that is my actual checking account,

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Speaker 2: and I use my checking account routing and account number

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Speaker 2: of course to go and bill pay at auto bill

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Speaker 2: pay just all the different accounts that are polling payments

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Speaker 2: from there when the time comes at the end of

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Speaker 2: the months, you know, like credit cards what not, things

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Speaker 2: like that. But when it comes to my actual savings account,

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Speaker 2: it is not anywhere out on the internet, And in

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Speaker 2: my mind, I don't know, I just posted it, actually,

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Speaker 2: just just go ahead tweeted it out. In my mind,

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Speaker 2: that feels slightly more secure because there is less of

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Speaker 2: a chance for where the bulk of my savings where

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Speaker 2: that's residing. That makes sense for that to be less

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Speaker 2: I don't know, it feels less prone to being leaked

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Speaker 2: in some sort of data hackers thing like that. So

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Speaker 2: I've not researched this, but this is my reasoning for

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Speaker 2: why it is that I always only pull money from

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Speaker 2: my checking account or an ally they call it the spending,

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Speaker 2: call it doxing.

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Speaker 1: I don't yeah, I don't want your savings account to

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Speaker 1: get docked publicly announced anybody. No, I think that makes

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Speaker 1: sense too. I think the other thing you can do

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Speaker 1: is instead of having those accounts pulled, you could push

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Speaker 1: some of those payments instead from the account that you use.

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Speaker 2: So so your actual savings account is where you have

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Speaker 2: the account information and then you're pushing enough. Yeah.

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Speaker 1: So that's another way, like similar through bill pay instead

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Speaker 1: of through there you go an ah pull from the

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Speaker 1: credit card company itself.

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Speaker 2: Yeah.

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Speaker 1: I always feel bad by the way, like Discover will

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Speaker 1: send me a physical letter in the mail because that's

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Speaker 1: where I do most of my banking right now, and

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Speaker 1: they'll say, hey, you've gone over your six limit transaction

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Speaker 1: and your savings account. We're not going to do anything

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Speaker 1: to you, but at some point you might want to

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Speaker 1: think about stopping that. I just wanted to let you know,

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Speaker 1: and I don't like to break the rules, Matt, so

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Speaker 1: I feel I feel like they don't like me for that.

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Speaker 1: They're like looking down their nose, and so I'm tired

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Speaker 1: of receiving those letters. I might try something different.

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Speaker 2: I was gonna say that you're going to complain about

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Speaker 2: just wasting paper in treaties, Well not too the fact

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Speaker 2: that they mail it. Somebody has got to keep the

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Speaker 2: Post Office USPS.

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Speaker 1: Send me a text, Bra, I'll take a look kind

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Speaker 1: of that way. All right, let's move on this mention.

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Speaker 1: The beer we're having on this episode. It is called

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Speaker 1: Heineken Silver. Have you heard of it? It's a mass

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Speaker 1: produced craft beer that we are drinking. It's still is

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Speaker 1: a self flagellation.

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Speaker 2: This is our last week of only drinking the most

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Speaker 2: unworthy beer.

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Speaker 1: Fortunately, because I'm getting tired of bad beers too. We'll

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Speaker 1: get back to the good stuff to your regularly scheduled

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Speaker 1: programming sooner rather than later.

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Speaker 2: It's hard to talk about our quote unquote craft beer

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Speaker 2: equivalent when we're over here drinking heine But this reinforces

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Speaker 2: that we like real beer and not bad beer. Absolutely true.

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Speaker 1: Every once in a while, you got a slummit to

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Speaker 1: recognize what life's worth living format, and craft beer is

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Speaker 1: one of those things that makes life great.

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Speaker 2: All right.

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Speaker 1: If you have a money question, by the way, and

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Speaker 1: you'd like Matt and I to take it on an

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Speaker 1: upcoming episode, just go to have the Money dot com

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Speaker 1: slash ask. You can record a voice memo, send it

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Speaker 1: our way. It's super easy, and hopefully we'll take it

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Speaker 1: next week on the show, Matt. This first question comes

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Speaker 1: from a listener who is really actually asking this question

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Speaker 1: on behalf of someone.

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Speaker 3: Who loves Hi Matin Jeel. This is Rob from Michigan.

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Speaker 3: When does it make sense to declare personal bankruptcy? My

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Speaker 3: sister in law recently reached out for help with her

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Speaker 3: financial situation. Without getting too deep into details, she has

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Speaker 3: a large amount of credit card debt, as well as educational,

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Speaker 3: personal and car loans. Thanks to her debt, her expenses

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Speaker 3: exceed her income even in an essential's only budget. Her

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Speaker 3: only asset is a partially paid off car, and she

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Speaker 3: is currently living rent free. On my advice, she attempted

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Speaker 3: to open a new line of credit to transfer some

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Speaker 3: of her thirty percent APR debt to a more manageable rate,

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Speaker 3: but she was denied. Thanks to a recent windfall, she

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Speaker 3: has enough savings to last about six months before she's

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Speaker 3: completely out of money, assuming she adheres to the spartan budget.

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Speaker 3: I have also suggested she call the credit card companies

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Speaker 3: to see if they can work with her. Unfortunately, her

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Speaker 3: debt is too much for us to take on in

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Speaker 3: any impactful way. Are there any other steps you would recommend?

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Speaker 3: When is bankruptcy the best option. Thank you, Rob Okay.

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Speaker 2: First off, I am sorry to hear about what it

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Speaker 2: is that your sister in law is going through. I think, honestly,

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Speaker 2: getting to the point to where your debt amount, like

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Speaker 2: your payments going out where that exceeds your income, that's

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Speaker 2: got to be tough. And I'll also say I appreciate

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Speaker 2: your willingness to help her with her debts even though

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Speaker 2: you can't afford to. You mentioned that how like the

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Speaker 2: I guess the financial assistance that you'd be able to

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Speaker 2: provide her, you could do it, but it would not

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Speaker 2: be enough to actually put a dent in it. The

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Speaker 2: heart is there, right, yeah, which means a lot. But

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Speaker 2: that being said, this isn't something that I would recommend doing.

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Speaker 2: Uh not because being helpful is bad a forth, but

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Speaker 2: because I think that could throw a wrench obviously in

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Speaker 2: your finances. But I also think that like I didn't

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Speaker 2: necessarily hear you mention that your sister in law is

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Speaker 2: having like a change of heart, and I think there

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Speaker 2: is a chance that you could potentially be doing more

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Speaker 2: harm than good by not addressing some of these underlying issues.

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Speaker 2: Whether it is on the expensive side, but maybe it's

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Speaker 2: also on the income side of things as well, and

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Speaker 2: so it just feels like slapping a band aid on

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Speaker 2: top of something that doesn't necessarily need a band aid

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Speaker 2: slapped on, as opposed to kind of like the underlying issues.

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Speaker 2: The truth is, the.

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Speaker 1: Problem often rears its ugly head again if there is

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Speaker 1: some sort of behavioral change that goes along with it.

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Speaker 1: Even if you paid off all her debt, she might

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Speaker 1: end up in the same position, and then everybody's in

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Speaker 1: a worse spot at the end of the day. Makes

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Speaker 1: me think that her to interview with Charles Barkley not

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Speaker 1: too long ago, the famous basketball player, and he was

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Speaker 1: talking about when he got rich, like what he started

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Speaker 1: to do was to buy things for his friends and family,

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Speaker 1: and he would give his money away to people that

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Speaker 1: were close to him. He's like, ah, we grew up together,

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Speaker 1: Like I got ridiculously rich, I should share the pie,

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Speaker 1: which sounds like the right thing to do, and it

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Speaker 1: sounds like the right way to make your friends happy.

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Speaker 1: But then you talked about how if you turned this

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Speaker 1: bigot off, people got instantly angry with him and actually

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Speaker 1: soured those relationships. It ruined some of those relationships where

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Speaker 1: he had been generous, and he realized he had reined

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Speaker 1: it in, and then it turns out, bam, that relationship

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Speaker 1: wasn't what he thought.

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Speaker 2: It was called the hedonic treadmill right there, though immediately

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Speaker 2: got used to that hires as cost of living.

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Speaker 1: So it's gonna be really hard when you're talking about

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Speaker 1: finances with relatives and anytime you are exceedingly generous, Not

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Speaker 1: that you can't or shouldn't be generous, That's not what

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Speaker 1: I'm trying to say, But it's just that, like, if

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Speaker 1: you're offering money to help fix this problem, it's easy

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Speaker 1: for people to get used to that and seeing you

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Speaker 1: as the ATM, and it changes the dynamics of your relationship. Right,

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Speaker 1: So instead of offering her money, I think being there

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Speaker 1: for her, walking her through the process of getting help,

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Speaker 1: that's the ideal route to take, not just like you know,

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Speaker 1: breaking off one hundred dollars bills to pay these debts

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Speaker 1: off and to help her get back to a place

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Speaker 1: of financial normalcy.

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Speaker 2: Exactly. Yeah, Yeah, she asked you for help, Rob, but

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Speaker 2: you didn't necessarily say what kind of help she reached

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Speaker 2: out to you for. Was it to provide some of

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Speaker 2: that knowledge that you have or was it? Surely from

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Speaker 2: a financial standpoint, But what is it that you should

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Speaker 2: do at this point, because it does sound like you

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Speaker 2: already have a pretty good idea of her incoming and

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Speaker 2: her outgoing expenses, you know, the overall debt situation, and

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Speaker 2: specifically you're certainly aware that her current income isn't going

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Speaker 2: to allow her to pay off those debts in any

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Speaker 2: sort of reliable way. I will say, I love that

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Speaker 2: you that you try to help her to contact the

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Speaker 2: credit card companies directly in an attempt to get her

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Speaker 2: APR lowered, because that's something that they will oftentimes do. Yeah.

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Speaker 1: We talked about that last week with Matt Schultz, right,

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Speaker 1: that a lot more people have the have success asking

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Speaker 1: for a reduction in APR from their credit card company.

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Speaker 2: Basically three out of four people, you would ask.

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Speaker 1: Yeah, so, I mean, she's one of the in the

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Speaker 1: in the lesser statistic there, But it makes sense, I

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Speaker 1: would say, given kind of where she's at with their

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Speaker 1: debts too.

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Speaker 2: Yeah, so that was a good move. But that being said,

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Speaker 2: she is likely going to have better luck working with

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Speaker 2: a non profit debt counseling agency. They've got these relationships

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Speaker 2: with the major lenders. Out there in the banks, which

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Speaker 2: means they have a greater ability to negotiate lower interest

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Speaker 2: rates and even honestly partial debt forgiveness in some cases.

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Speaker 2: So much of it comes down to her unique circumstances.

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Speaker 2: So I'm glad that you started to interact with some

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Speaker 2: of the different financial institutions, whether with her or on

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Speaker 2: behalf of her, But I think we would really want

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Speaker 2: you to get her pointed in the direction of actual

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Speaker 2: debt counseling.

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Speaker 1: Yes, yeah, they can act like as a mediator as

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Speaker 1: an advocate, And the truth is like it, it can

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Speaker 1: be hard to advocate for yourself, and you can do

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Speaker 1: your best, but sometimes there's just somebody who's in a

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Speaker 1: better position than you to advocate it. It makes me

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Speaker 1: think of like a baseball call, matt out at home plate. Well,

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Speaker 1: the person sliding can make the argument, but then the

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Speaker 1: manager comes out and argues, and let's be honest, he

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Speaker 1: usually gets thrown out of the game. But that's at

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Speaker 1: least just that's a better person to advocate, like a

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Speaker 1: third party who was watching, who's kind of in a

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Speaker 1: position of strength to make that argument to the umpire.

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Speaker 1: I don't know, I just always like watching them yell

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Speaker 1: at each other, but we're.

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Speaker 2: Talking, even though it doesn't change anything. Well, I've ever

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Speaker 2: seen it a call reversed very rarely. Yeah, but usually

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Speaker 2: they go back to the videotape.

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Speaker 1: But it makes me think of the Atlanta Braves long

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Speaker 1: standing manager Bobby Cox. I think he got thrown out

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Speaker 1: of more games than any other manager in history, really,

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Speaker 1: so I just got used to He was like the

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Speaker 1: sweetest guy, but he would always stand up for his players,

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Speaker 1: and I love that about him.

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Speaker 2: He's a great advocate.

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Speaker 1: Yeah, you don't usually get that call reverse, but you

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Speaker 1: might with a nonprofit debt counseling firm. So MMI is

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Speaker 1: one of the best places to turn Money Management International

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Speaker 1: the NFCC National Foundation for Credit Counseling. You can go

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Speaker 1: to both those websites. Will put them both in the

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Speaker 1: show notes for this episode. Those are the two biggest

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Speaker 1: nonprofits in the country with local chapters all over the place,

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Speaker 1: but because of their relationships with the big financial institutions,

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Speaker 1: they can make progress where individuals fail. It's kind of

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Speaker 1: like Game Genie for your finances, right again, they have

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Speaker 1: this ability to do something that you wouldn't be able

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Speaker 1: to do yourself. So talking to someone at either of

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Speaker 1: these organizations is ideal because they'll have so much insight

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Speaker 1: as to whether a debt management plan what they call

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Speaker 1: a DMP or filing for bankruptcy would be the best

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Speaker 1: best path forward for her to take. It's kind of

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Speaker 1: hard for Matt and I to armshare quarterback and say

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Speaker 1: because we don't know all the details, but they will

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Speaker 1: pour through all the details and help you make a

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Speaker 1: wise decision. Bankruptcy can be more expensive, right, She might

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Speaker 1: not qualify for bankruptcy either. The process as well can

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Speaker 1: be onerous, so avoiding it just because of that can

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Speaker 1: be the wisest move if there's another path forward. And

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Speaker 1: then bankruptcy too, whether we're talking about Chapter seven or

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Speaker 1: Chapter thirteen, can affect her finances for years to come,

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Speaker 1: which has to be said, right, I mean, basically, this

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Speaker 1: is a really significant decision, and you do not want

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Speaker 1: her to make it lightly just because she, of course

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Speaker 1: understandably feels overwhelmed with her current financial situation.

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Speaker 2: Another piece of information you shared Rob too, you said

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Speaker 2: educational costs. I assume we're talking about student loans, which

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Speaker 2: are also I mean, those are even harder to have

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Speaker 2: discharged in bankruptcy. Although it's become easier to become easier.

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Speaker 2: But I mean, it's just something else to consider. Because

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Speaker 2: you have to file an adversary preceding, there's additional steps,

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Speaker 2: there are additional costs more likely if you have private

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Speaker 2: student loans, given the fact that with federal student loans,

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Speaker 2: with the debt repayment, the save plan essentially there are

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Speaker 2: more options out there that are available to folks.

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Speaker 1: Depending on her income, the save plan might dramatically reduce,

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Speaker 1: if not eliminate a monthly payment need from you know,

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Speaker 1: and then eventually provide her forgiveness too. So that could

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Speaker 1: be a massive.

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Speaker 2: Help to her. That's on the horizon that maybe she

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Speaker 2: hasn't factored in totally. Yeah, so that's something else to consider.

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Speaker 2: But really, whether or not she should file for bankruptcy,

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Speaker 2: it's a question of degrees. It's less black and white

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Speaker 2: and it's a little more gray, a little more there

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Speaker 2: in the middle. Because it certainly sounds like, you know, bankruptcy,

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Speaker 2: it might be the best option, especially considering the fact

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Speaker 2: that you mentioned her budget is it's really paired down.

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Speaker 2: I think he says like she's got a spartan budget,

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Speaker 2: but even still, she doesn't have the income to support that.

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Speaker 2: So it's not like there are additional cuts that she

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Speaker 2: can make, and so it and honestly, from our vantage point,

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Speaker 2: it does seem like that that might be the best

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Speaker 2: solution because if her income's not going to go up

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Speaker 2: like that's one piece of information that I would want

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Speaker 2: to know, what is the likelihood of your income increasing,

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Speaker 2: Because it doesn't matter if you are going to make

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Speaker 2: additional cuts, if you don't have enough money to service

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Speaker 2: these debts and pay them off completely, it doesn't really,

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Speaker 2: it doesn't matter a whole lot. All you're doing is

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Speaker 2: prolonging the inevitable. And so again, this is something that

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Speaker 2: working with a debt counselor that they might be able

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Speaker 2: to resolve, because if you're able to get some of

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Speaker 2: those amounts reduced or partially forgiven, well that could completely

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Speaker 2: change the game. That could change the story.

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Speaker 1: And when you meet with them, they'll typically know because

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Speaker 1: they met with hundreds of similar people, and they'll say, okay,

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Speaker 1: clearly like you you're either like right here on the

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Speaker 1: line and we you know, here's the pros and cons

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Speaker 1: of going in either direction, or they'll say, oh, you're

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Speaker 1: definitely more over in the bankruptcy camp or no, wait,

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Speaker 1: we can totally do a DMP. You can be out

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Speaker 1: of debt in four to five years something like that,

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Speaker 1: because we've got relationships with this credit card company whatever.

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Speaker 1: Just that initial meeting I think will tell her a lot.

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Speaker 1: But that's where I would want to go if I

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Speaker 1: was her, I would want to turn to experts who

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Speaker 1: are incentivized to help, who aren't going to you know,

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Speaker 1: try urn arm and a leg to provide great advice.

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Speaker 2: Yeah, and Rob mentioned too that she had a small windfall,

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Speaker 2: so it sounds like she has some additional savings there

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Speaker 2: in the bank. But don't just kick back and think that, oh, okay,

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Speaker 2: things have been fixed. I'm fine, because I think he

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Speaker 2: only said that it's maybe going to cover like the

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Speaker 2: next six months worth of living. Yeah, a fuse has

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Speaker 2: been lit, and I.

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Speaker 1: Don't use it to pay down debt right now, because

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Speaker 1: maybe you might lose some leverage and you might lose

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Speaker 1: the ability to pay for necessities too, exactly.

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Speaker 2: And so yeah, basically, the way I see it, there's

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Speaker 2: like a taking time that's going on that's about to

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Speaker 2: explode here in six months or at least, That's how

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Speaker 2: I would want to approach it. Don't kick back and relax,

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Speaker 2: but use the next six months to figure out what

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Speaker 2: it is that you're going to do with this debt.

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Speaker 2: View this additional money there in the bank as additional

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Speaker 2: I guess mental headspace that is going to allow you

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Speaker 2: to really address this.

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Speaker 1: Yeah, I think procrastination can only make things worse on

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Speaker 1: this one. So Rob, kudos to you for helping out

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Speaker 1: your sister in law and man. We hope that this

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Speaker 1: answer helps push you both in the right direction, and

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Speaker 1: we're hoping the best. Now we've got more questions to

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Speaker 1: get to and we're gonna specifically talk about shifting your

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Speaker 1: debt around, trying to make it less egregious. We'll talk

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Speaker 1: about that and more right after this.

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Speaker 2: All right, Jil, we are back from the break, and

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Speaker 2: let's know here from a long time listener who is

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Speaker 2: crushing it when it comes to her financial goals.

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Speaker 4: Hi, Matt and Joel. It's Yessel from New York City

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Speaker 4: with yet another ask kind of money question. Thanks as

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Speaker 4: always for your amazing work on your podcast, newsletter and blog.

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Speaker 4: This is why I keep coming back to you with

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Speaker 4: all these questions. So thanks to you, I moved all

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Speaker 4: my savings out of Wells Fargo and Bank of America

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Speaker 4: into an ally online high Yield savings account, So thanks

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Speaker 4: for that advice. After doing that, I do have more

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Speaker 4: than the insured amount of the two hundred and fifty k.

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Speaker 4: This feels a little precarious to me, so I'd like

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Speaker 4: your advice on what to do with the excess cash.

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Speaker 4: I have two iras through m one. One is traditional

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Speaker 4: IRA that I'm going to max out through bi weekly contributions,

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Speaker 4: and I have a step IRA since I'm self employed,

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Speaker 4: that I'm also contributing to bi weekly. And since I

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Speaker 4: said I am self employed, I don't get to put

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Speaker 4: anything into an HSA. Do you think I should open

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Speaker 4: another high yield savings account at another online bank like

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Speaker 4: CI and or should I put the cash into a

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Speaker 4: new taxable brokerage account at one of the suggested places

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Speaker 4: like Vanguard, Schwab or Fidelity do both? Anything else you

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Speaker 4: have in mind, whatever advice you have, would be very helpful.

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Speaker 4: Thanks as always, have a great day, y'all.

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Speaker 2: Matt.

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Speaker 1: First, mad props to Yessel for ditching the big banks.

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Speaker 1: Oh yeah, they're so bad. There's just no reason to

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Speaker 1: stay with the biggest banks. We've been screaming this from

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Speaker 1: the hilltops for a long time. A lot of people

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Speaker 1: still miss the memo, and I'm always fascinated when I

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Speaker 1: run into people they're like, oh, I'm just gonna go

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Speaker 1: down to willisbergro over here, And I'm like, now, what

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Speaker 1: are you doing? Why would you have a relationship with

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Speaker 1: a bank that hates you? But yes, well no longer does.

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Speaker 2: Which is awesome.

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Speaker 1: The reason to do that isn't just because they're not

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Speaker 1: paying a high as high of a rate. That's one thing, right,

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Speaker 1: It's like, hey, pay me what's fair in the marketplace.

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Speaker 1: But it's more than that, right. The big banks are

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Speaker 1: just the tree customers poorly, they charge higher fees, and

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Speaker 1: if all those lawsuits, especially against Wells Fargo, the judgments,

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Speaker 1: the news articles don't cause you to leave, what will.

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Speaker 1: We don't see any compelling reason to do business with

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Speaker 1: the four biggest banks with credit cards, I would say,

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Speaker 1: being the major exception. There's some great credit cards that

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Speaker 1: they offer that are competitive and some of the best

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Speaker 1: actually around. But when it comes to just traditional banking,

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Speaker 1: online banks just for the win, that's right.

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Speaker 2: And yes, well you seem to be the rare person

436
00:19:45,960 --> 00:19:50,000
Speaker 2: with loads of cash on hand, and not that we're

437
00:19:50,040 --> 00:19:53,320
Speaker 2: predicting the downfall of any sort of banking sector collapse

438
00:19:53,400 --> 00:19:57,119
Speaker 2: kind of thing. But the SVB, the Silicon Valley Bank,

439
00:19:57,160 --> 00:20:00,800
Speaker 2: and the subsequent regional banking collapses that should have taught

440
00:20:00,840 --> 00:20:03,520
Speaker 2: us all a lesson because even though the Fed's backstopped

441
00:20:03,560 --> 00:20:04,199
Speaker 2: all the money, and I.

442
00:20:04,200 --> 00:20:06,560
Speaker 1: Don't know what lesson we learned in some ways because

443
00:20:06,560 --> 00:20:08,399
Speaker 1: like you're right, they didn't handle it the way they

444
00:20:08,400 --> 00:20:10,400
Speaker 1: were supposed to. They said, oh, we're going to make

445
00:20:10,400 --> 00:20:13,080
Speaker 1: sure everyone's made whole. So that's not traditionally what FDIC

446
00:20:13,119 --> 00:20:13,960
Speaker 1: insurance is supposed to do.

447
00:20:14,080 --> 00:20:16,719
Speaker 2: Yeah, again, it comes down to enabling and the incentives

448
00:20:16,720 --> 00:20:20,040
Speaker 2: that you are providing folks or not providing folks. But

449
00:20:20,520 --> 00:20:22,399
Speaker 2: bottom line, there is a limit of two hundred and

450
00:20:22,400 --> 00:20:25,560
Speaker 2: fifty thousand dollars and because of that, that certainly could

451
00:20:25,600 --> 00:20:29,200
Speaker 2: mean opening up another count. You could have one with Ally,

452
00:20:29,280 --> 00:20:32,760
Speaker 2: but you could have another with CIT because I mentioned CIT,

453
00:20:32,840 --> 00:20:35,440
Speaker 2: because they are they're paying one of the highest rates

454
00:20:35,440 --> 00:20:38,200
Speaker 2: on their savings accounts out there. But bottom line, that

455
00:20:38,200 --> 00:20:39,720
Speaker 2: makes a whole lot of sense to me if that's

456
00:20:40,440 --> 00:20:42,080
Speaker 2: a route that you wanted to go, If you are

457
00:20:42,119 --> 00:20:45,320
Speaker 2: somebody who is going to continue to maintain a lot

458
00:20:45,400 --> 00:20:46,879
Speaker 2: of money in savings. Yeah.

459
00:20:47,040 --> 00:20:49,480
Speaker 1: Yeah, And we can talk about whether or not that

460
00:20:49,520 --> 00:20:51,720
Speaker 1: makes sense here in just a second. I think another option, Matt.

461
00:20:52,080 --> 00:20:54,480
Speaker 1: One option, yes, is to have a second bank account

462
00:20:54,680 --> 00:20:56,960
Speaker 1: and to say, listen, I'm going to transfer another big

463
00:20:57,040 --> 00:21:00,359
Speaker 1: chunk of the savings over here. I'm gonna keep both

464
00:21:00,800 --> 00:21:03,080
Speaker 1: accounts below the two hundred fifty thousand dollars limit, and

465
00:21:03,119 --> 00:21:06,720
Speaker 1: since with separate institutions, I have coverage for both of

466
00:21:06,720 --> 00:21:09,520
Speaker 1: those accounts. Another option would be to transfer all of

467
00:21:09,520 --> 00:21:12,320
Speaker 1: your savings over to Betterment or to Wealth Front, the

468
00:21:12,400 --> 00:21:15,200
Speaker 1: account we mentioned earlier. Betterment's actually paying five and a

469
00:21:15,240 --> 00:21:18,280
Speaker 1: half percent right now. The extra half a percent is

470
00:21:18,280 --> 00:21:20,840
Speaker 1: a three month bonus when you sign up. But that's

471
00:21:20,880 --> 00:21:23,720
Speaker 1: the highest rate we've seen. But here's the deal.

472
00:21:23,720 --> 00:21:24,240
Speaker 2: You're not just.

473
00:21:24,240 --> 00:21:27,359
Speaker 1: Moving money over for a slightly better rate. Betterment selling

474
00:21:27,680 --> 00:21:30,119
Speaker 1: proposition in Wealth Front two is that they're able to

475
00:21:30,160 --> 00:21:33,359
Speaker 1: offer you even more FDIC insurance coverage so they're not

476
00:21:33,600 --> 00:21:35,640
Speaker 1: forced to adhere to the strict two hundred and fifty

477
00:21:35,680 --> 00:21:38,760
Speaker 1: thousand dollars limit. Well, how is that, Well, it's because

478
00:21:38,760 --> 00:21:40,600
Speaker 1: they don't just have one partner bank. They've got a

479
00:21:40,600 --> 00:21:42,640
Speaker 1: bunch of them. So you can deposit up to two

480
00:21:42,720 --> 00:21:45,600
Speaker 1: million dollars as a single individual and four million dollars

481
00:21:45,680 --> 00:21:48,120
Speaker 1: on a joint account and you have the whole amount

482
00:21:48,200 --> 00:21:50,679
Speaker 1: completely covered. So that's kind of cool. It's like a

483
00:21:50,680 --> 00:21:52,879
Speaker 1: one stop shop, right. Those are actually some of the

484
00:21:52,880 --> 00:21:55,840
Speaker 1: most flexible, easy to use accounts now paying the highest

485
00:21:55,920 --> 00:22:00,480
Speaker 1: rate extra FDIC coverage. And I think large because they're

486
00:22:00,480 --> 00:22:03,320
Speaker 1: attached to an investment platform that makes sense. Investors might

487
00:22:03,359 --> 00:22:05,200
Speaker 1: be cashing out of the big thing, sticking it into

488
00:22:05,200 --> 00:22:07,720
Speaker 1: the you know, into their general cash fund or something

489
00:22:07,760 --> 00:22:09,920
Speaker 1: like that, and so it makes them even more competitive

490
00:22:10,000 --> 00:22:12,720
Speaker 1: in that marketplace. But I think of those accounts as

491
00:22:12,760 --> 00:22:15,199
Speaker 1: great places to turn. Actually, some of the investment houses

492
00:22:15,400 --> 00:22:17,680
Speaker 1: have some of the best bank accounts now, better than

493
00:22:17,680 --> 00:22:18,840
Speaker 1: some of what the banks are offering.

494
00:22:18,880 --> 00:22:21,040
Speaker 2: Yeah, it's like a four x double word score all

495
00:22:21,040 --> 00:22:24,000
Speaker 2: on your savings account, which is pretty sweet much certainly

496
00:22:24,080 --> 00:22:26,679
Speaker 2: much better than what it is at C and triple

497
00:22:26,680 --> 00:22:29,520
Speaker 2: word and triple letter what they're offering. I used a

498
00:22:29,600 --> 00:22:32,000
Speaker 2: q anaz in that word map quiz. So what I

499
00:22:32,000 --> 00:22:34,679
Speaker 2: was alluding to, though, is whether or not having an

500
00:22:34,720 --> 00:22:38,640
Speaker 2: amassing a massive savings amount like that, whether or not

501
00:22:38,880 --> 00:22:41,880
Speaker 2: whether or not that makes sense, because Yessel, you asked

502
00:22:41,920 --> 00:22:44,639
Speaker 2: about sticking a portion of your savings into a taxable

503
00:22:44,760 --> 00:22:49,560
Speaker 2: brokerage account instead, and I'm gonna say that that's probably wise,

504
00:22:50,160 --> 00:22:53,000
Speaker 2: And specifically, I'm gonna say probably because if you're planning

505
00:22:53,000 --> 00:22:56,440
Speaker 2: on using that large sum of dollar bills soon, well

506
00:22:56,520 --> 00:22:58,719
Speaker 2: that's not a great suggestion because you don't want to

507
00:22:58,800 --> 00:23:00,960
Speaker 2: have that money tied up in investments. You want to

508
00:23:01,000 --> 00:23:04,720
Speaker 2: keep it liquid. But that's a really large supply of savings.

509
00:23:04,760 --> 00:23:07,399
Speaker 2: And so unless you're looking to buy a really nice house,

510
00:23:07,800 --> 00:23:10,760
Speaker 2: I think you should likely be investing a decent chunk

511
00:23:10,960 --> 00:23:14,000
Speaker 2: of that savings instead. She mentioned too, that she's self employed.

512
00:23:14,000 --> 00:23:17,000
Speaker 2: That's why she's got that sep IRA. When you are

513
00:23:17,040 --> 00:23:20,520
Speaker 2: self employed, that's a riskier proposition. And so maybe she's thinking,

514
00:23:20,600 --> 00:23:22,920
Speaker 2: all right, no, I want to have a really nice,

515
00:23:22,960 --> 00:23:25,920
Speaker 2: padded emergency fund, maybe with a really fat emergency fund

516
00:23:26,000 --> 00:23:28,200
Speaker 2: on top of some additional savings goals that she has.

517
00:23:28,760 --> 00:23:30,600
Speaker 2: Maybe she's exactly where she wants to be, where she

518
00:23:30,640 --> 00:23:32,960
Speaker 2: needs to be. And if that's what it takes for

519
00:23:33,000 --> 00:23:34,920
Speaker 2: you to feel comfortable, yes, and for you to de

520
00:23:35,119 --> 00:23:37,040
Speaker 2: risk in that way, more power to you. I'm not

521
00:23:37,080 --> 00:23:38,399
Speaker 2: going to tell you what it is that you should

522
00:23:38,520 --> 00:23:40,600
Speaker 2: and should not be saving for, but I just want

523
00:23:40,680 --> 00:23:42,359
Speaker 2: to plant that idea in your head as well, just

524
00:23:42,400 --> 00:23:44,600
Speaker 2: to make sure that you're not continuing to do this

525
00:23:44,600 --> 00:23:46,520
Speaker 2: thing because you've always essentially done it.

526
00:23:46,520 --> 00:23:46,639
Speaker 3: Well.

527
00:23:46,680 --> 00:23:49,000
Speaker 1: We've been saying that regularly too. Right, Hey, five percent

528
00:23:49,680 --> 00:23:52,679
Speaker 1: rate of return for savers is great, and it's beating

529
00:23:52,680 --> 00:23:55,600
Speaker 1: inflation now, and so being a saber doesn't suck for

530
00:23:55,640 --> 00:23:58,280
Speaker 1: the first time in a long time. But still it's

531
00:23:58,280 --> 00:24:01,000
Speaker 1: possible to get a little too comfortable higher savings rates

532
00:24:01,240 --> 00:24:06,720
Speaker 1: and neglect the riskier but overall less risky over the

533
00:24:06,720 --> 00:24:10,119
Speaker 1: decades alternative of investing more of those dollars, right, And

534
00:24:10,200 --> 00:24:12,400
Speaker 1: so yeah, if you don't have a near term goal

535
00:24:12,480 --> 00:24:14,800
Speaker 1: for that money, it might be enticing to keep them

536
00:24:14,840 --> 00:24:18,000
Speaker 1: in savings because rates don't suck. But we all know

537
00:24:18,040 --> 00:24:19,960
Speaker 1: the average returns to the market are going to outpace

538
00:24:20,000 --> 00:24:22,120
Speaker 1: what your savings can earn, even if it's a guaranteed

539
00:24:22,160 --> 00:24:24,920
Speaker 1: five percent return. Right, you could either make a lump

540
00:24:24,920 --> 00:24:27,600
Speaker 1: sum investment into the market, like a one time deal,

541
00:24:27,680 --> 00:24:29,760
Speaker 1: just put an extra one hundred K or whatever it is. Say,

542
00:24:29,840 --> 00:24:31,439
Speaker 1: I don't need this much savings, let me thrust that

543
00:24:31,480 --> 00:24:34,080
Speaker 1: into the market. That's typically the advisable thing to do

544
00:24:34,119 --> 00:24:36,280
Speaker 1: when you look at the numbers. But if dollar cost

545
00:24:36,359 --> 00:24:38,600
Speaker 1: averaging would make it easier to stomach, just make a

546
00:24:38,640 --> 00:24:40,840
Speaker 1: plan to get a chunk of those savings dollars into

547
00:24:40,880 --> 00:24:43,919
Speaker 1: the market regularly over the next year or so. And

548
00:24:43,960 --> 00:24:47,240
Speaker 1: so maybe that's a few thousand dollars every two weeks

549
00:24:47,359 --> 00:24:49,360
Speaker 1: or whatever. I mean, it depends on how much you're

550
00:24:49,400 --> 00:24:51,119
Speaker 1: trying to put in and what time frame you want

551
00:24:51,160 --> 00:24:53,880
Speaker 1: to get that money in over and of course keep

552
00:24:53,880 --> 00:24:57,120
Speaker 1: some savings on hand for security and liquidity purposes, especially

553
00:24:57,320 --> 00:24:59,199
Speaker 1: as a self employed individual. We're not trying to make

554
00:24:59,240 --> 00:25:01,000
Speaker 1: you cash poor, but we also want to make sure

555
00:25:01,040 --> 00:25:02,719
Speaker 1: you're just not overdoing it in that direction.

556
00:25:03,080 --> 00:25:06,080
Speaker 2: That's right, And she is investing. She's got multiple iras,

557
00:25:06,119 --> 00:25:09,480
Speaker 2: like we mentioned, she's got investment dollars with M one

558
00:25:10,200 --> 00:25:11,600
Speaker 2: and so I would say, feel free to open up

559
00:25:11,600 --> 00:25:14,480
Speaker 2: a taxable brokerage acount over there, and you can't go

560
00:25:14,520 --> 00:25:17,159
Speaker 2: wrong with the other low cost investment options that you

561
00:25:17,280 --> 00:25:19,679
Speaker 2: also mentioned. But over time, this is going to be

562
00:25:19,680 --> 00:25:23,000
Speaker 2: a great thing to have, specifically the taxable brokerage account,

563
00:25:23,359 --> 00:25:27,000
Speaker 2: because now you're going to have greater pre retirement flexibility

564
00:25:27,040 --> 00:25:29,399
Speaker 2: to use some of those funds. In particular, So obviously

565
00:25:29,440 --> 00:25:31,359
Speaker 2: you don't get the tax break, but the ability to

566
00:25:31,359 --> 00:25:33,879
Speaker 2: tap some of the funds before you're fifty nine and

567
00:25:33,920 --> 00:25:36,800
Speaker 2: a half man, that's a that's a pretty sweet proposition. Yeah,

568
00:25:36,840 --> 00:25:38,560
Speaker 2: But for everyone else out there, we don't want folks

569
00:25:38,640 --> 00:25:41,080
Speaker 2: to freak out for every dollar that they have over

570
00:25:41,119 --> 00:25:43,760
Speaker 2: that two hundred and fifty thousand dollars mark. I mean, personally,

571
00:25:43,840 --> 00:25:46,080
Speaker 2: I wouldn't be too concerned about it. And something else

572
00:25:46,440 --> 00:25:49,960
Speaker 2: remember too, Again for other couples out there as well,

573
00:25:50,080 --> 00:25:52,520
Speaker 2: it's per person and so if you have a joint account,

574
00:25:52,520 --> 00:25:53,920
Speaker 2: you're not looking at two hundred and fifty k, you're

575
00:25:53,920 --> 00:25:56,560
Speaker 2: looking at five hundred k. Yeah, and so just keep

576
00:25:56,560 --> 00:25:58,040
Speaker 2: that in mind as well. But I think this, I

577
00:25:58,080 --> 00:25:59,639
Speaker 2: wouldn't trust the fence to bail me out like they

578
00:25:59,640 --> 00:26:01,159
Speaker 2: did time. Like they might.

579
00:26:01,320 --> 00:26:03,320
Speaker 1: True, they might continue to do that, but I wouldn't

580
00:26:03,359 --> 00:26:05,520
Speaker 1: bank on it. Yeah, I would not make a pun intended.

581
00:26:05,600 --> 00:26:07,720
Speaker 2: But again, more than anything, I think this is a

582
00:26:07,760 --> 00:26:10,840
Speaker 2: good reminder to make sure that you have goals for

583
00:26:10,960 --> 00:26:12,920
Speaker 2: your money. It's just to not sock that money away.

584
00:26:12,920 --> 00:26:14,760
Speaker 2: I think that's the biggest takeaway Joel that you mentioned

585
00:26:15,359 --> 00:26:17,520
Speaker 2: it feels good and you see that interest payment hit

586
00:26:17,560 --> 00:26:18,800
Speaker 2: the account there at the end of the month, and

587
00:26:18,840 --> 00:26:22,080
Speaker 2: you're like, oh, yeah, I'm making money doing nothing, But

588
00:26:22,359 --> 00:26:24,000
Speaker 2: that money could actually be doing a whole lot more

589
00:26:24,080 --> 00:26:25,640
Speaker 2: for you if it was actually invested.

590
00:26:25,720 --> 00:26:27,959
Speaker 1: Yeah, And sometimes the biggest risk we can take is

591
00:26:28,440 --> 00:26:30,680
Speaker 1: de risking too much. All right, Matt, let's get to

592
00:26:30,760 --> 00:26:34,040
Speaker 1: the next question. This one is about investing, but it's

593
00:26:34,040 --> 00:26:35,280
Speaker 1: got an interesting twist to it.

594
00:26:35,840 --> 00:26:39,480
Speaker 5: Hi, Matt and Joel, this is Katie from Colorado. My

595
00:26:39,560 --> 00:26:42,160
Speaker 5: husband and I recently got married after a long visa

596
00:26:42,240 --> 00:26:45,000
Speaker 5: wait for him to come from his home country in Bolivia.

597
00:26:45,760 --> 00:26:48,520
Speaker 5: While he finally has a work permit, he's still waiting

598
00:26:48,520 --> 00:26:51,440
Speaker 5: for his residency, which could take another year or more.

599
00:26:52,040 --> 00:26:54,600
Speaker 5: He's about to start his first job and we would

600
00:26:54,680 --> 00:26:57,320
Speaker 5: like to invest some of his earnings in a retirement account.

601
00:26:58,160 --> 00:27:01,240
Speaker 5: I currently use Vanguard for both wrath ira and a

602
00:27:01,280 --> 00:27:05,679
Speaker 5: traditional ira, but when I spoke with Vanguard, only citizens

603
00:27:05,960 --> 00:27:09,440
Speaker 5: and in some cases US residents can hold an account

604
00:27:09,440 --> 00:27:13,440
Speaker 5: with Vanguard. His new job doesn't offer any retirement options.

605
00:27:14,160 --> 00:27:17,280
Speaker 5: Do you have any suggestions for retirement investment options? While

606
00:27:17,320 --> 00:27:20,760
Speaker 5: he waits on his residency or citizenship or no of

607
00:27:20,840 --> 00:27:24,560
Speaker 5: other companies that don't have the same restrictions. Thanks so much.

608
00:27:25,080 --> 00:27:26,879
Speaker 5: Your show is such a great resource.

609
00:27:27,400 --> 00:27:29,520
Speaker 2: Oh so, Joel, this might be an instance where Vanguard

610
00:27:29,680 --> 00:27:32,960
Speaker 2: isn't the number one pick because I feel like oftentimes

611
00:27:32,960 --> 00:27:35,720
Speaker 2: it is Vain. We're like, oh, the solution is always Vanguard.

612
00:27:35,920 --> 00:27:38,040
Speaker 2: For Kenny's question, they answer may not be Vanguard.

613
00:27:38,080 --> 00:27:40,480
Speaker 1: Vanguard has been losing some of its lusterer in recent years.

614
00:27:40,680 --> 00:27:43,720
Speaker 1: I think they started the whole low cost We talked

615
00:27:43,720 --> 00:27:46,760
Speaker 1: about that back in the day with Robin Wigglesworth Worth.

616
00:27:46,800 --> 00:27:49,959
Speaker 1: He wrote the book about basically Vanguard starting the index

617
00:27:50,000 --> 00:27:53,280
Speaker 1: funds revolution. But the hangloves come off a little bit

618
00:27:53,320 --> 00:27:53,720
Speaker 1: of Vanguard.

619
00:27:53,720 --> 00:27:55,359
Speaker 2: They've got a new CEO. I don't know.

620
00:27:55,400 --> 00:27:58,119
Speaker 1: The customer service has kind of taken a dump, at

621
00:27:58,200 --> 00:28:00,480
Speaker 1: least from some of the stuff I've read online. So

622
00:28:00,560 --> 00:28:03,440
Speaker 1: I still love me some Vanguard, but I don't know.

623
00:28:03,640 --> 00:28:06,080
Speaker 2: Who has better their customer service over the past five years.

624
00:28:06,200 --> 00:28:10,400
Speaker 2: That's a good question. But Okay, enough about dis Vanguard,

625
00:28:10,480 --> 00:28:13,720
Speaker 2: I guess broadly speaking, but Katie, you specifically congrats on

626
00:28:13,720 --> 00:28:16,399
Speaker 2: getting married, by the way, I think that's certainly something

627
00:28:16,440 --> 00:28:20,040
Speaker 2: worth celebrating. And it's true that it is often harder

628
00:28:20,040 --> 00:28:23,679
Speaker 2: for non residents to invest within the US, and this

629
00:28:23,720 --> 00:28:27,440
Speaker 2: actually stems back to the post nine to eleven Patriot Act.

630
00:28:28,160 --> 00:28:31,480
Speaker 2: And because of that, banks investment firms out there, they

631
00:28:31,520 --> 00:28:34,800
Speaker 2: have more of an obligation to essentially know their customer,

632
00:28:35,200 --> 00:28:38,360
Speaker 2: and so different companies are going to have varied policies

633
00:28:38,360 --> 00:28:40,120
Speaker 2: in place. Your husband, he might have to go in

634
00:28:40,160 --> 00:28:43,680
Speaker 2: person and might have to fill out paperwork there like

635
00:28:43,760 --> 00:28:46,360
Speaker 2: within an office, in order to open an account with

636
00:28:46,360 --> 00:28:48,560
Speaker 2: some brokerages out there. But then he might have to

637
00:28:48,640 --> 00:28:52,680
Speaker 2: show up and provide proof of employment to different companies,

638
00:28:52,680 --> 00:28:56,160
Speaker 2: to different brokerages. But then others like Vanguard, it seems

639
00:28:56,560 --> 00:28:58,760
Speaker 2: they're out there trying to make things even more difficult

640
00:28:58,800 --> 00:28:59,040
Speaker 2: for you.

641
00:28:59,240 --> 00:29:02,720
Speaker 1: Yeah, yeah, I mean, it just depends on how strict

642
00:29:02,800 --> 00:29:05,280
Speaker 1: some of these companies are in trying to adhere to

643
00:29:05,360 --> 00:29:08,000
Speaker 1: this law. And yeah, I saw what I would do

644
00:29:08,360 --> 00:29:09,840
Speaker 1: at Katie Is, I'd reach out to some of the

645
00:29:09,920 --> 00:29:13,240
Speaker 1: other best low cost brokerage firms like Fidelity and Schwab.

646
00:29:13,800 --> 00:29:15,960
Speaker 1: Low costs are important, but so is being able to

647
00:29:15,960 --> 00:29:18,320
Speaker 1: do business with that brokerage too, And a Vanguards is

648
00:29:18,360 --> 00:29:21,440
Speaker 1: going to make you get a hydrid hoops, I would

649
00:29:21,440 --> 00:29:23,760
Speaker 1: be like, screw you, I'm going to go elsewhere. And

650
00:29:23,840 --> 00:29:27,600
Speaker 1: so Schwab, for instance, has a team called the International

651
00:29:27,640 --> 00:29:29,960
Speaker 1: account Solutions Team, and they've got a form that you

652
00:29:29,960 --> 00:29:32,960
Speaker 1: can fill out online. I'm not sure how difficult it is,

653
00:29:33,000 --> 00:29:35,240
Speaker 1: but it's probably worth barking up that tree. From everything

654
00:29:35,240 --> 00:29:37,640
Speaker 1: I could tell, it seems like Schwab makes it a

655
00:29:37,720 --> 00:29:40,160
Speaker 1: little bit easier for folks living in the US who

656
00:29:40,200 --> 00:29:43,760
Speaker 1: aren't yet citizens to invest, and like I just I

657
00:29:43,760 --> 00:29:46,200
Speaker 1: don't think they're making it as difficult as Vanguard is.

658
00:29:46,280 --> 00:29:48,840
Speaker 2: Yeah, but then specifically investing within a brokerage account like

659
00:29:48,880 --> 00:29:51,400
Speaker 2: that alone, that is not ideal. It's going to be nice,

660
00:29:51,440 --> 00:29:53,800
Speaker 2: of course to invest in some of our favorite tax

661
00:29:54,000 --> 00:29:57,160
Speaker 2: advantaged accounts as well. But your husband, he shouldn't only

662
00:29:57,280 --> 00:30:00,800
Speaker 2: have brokerage accounts at his disposal. He should be able

663
00:30:00,880 --> 00:30:04,760
Speaker 2: to contribute to a traditional or a roth ira as well.

664
00:30:05,320 --> 00:30:07,480
Speaker 2: One of the hurdles that it sounds like he has

665
00:30:07,640 --> 00:30:12,000
Speaker 2: successfully cleared is having taxable income here within the US.

666
00:30:12,680 --> 00:30:14,160
Speaker 2: So the key here is just to find a brokerage

667
00:30:14,160 --> 00:30:16,920
Speaker 2: firm that won't make it too difficult to open an

668
00:30:16,960 --> 00:30:20,000
Speaker 2: account and start a relationship. Most of the different firms

669
00:30:20,000 --> 00:30:23,560
Speaker 2: out there at least require a Social Security number, And Katie,

670
00:30:23,560 --> 00:30:26,160
Speaker 2: with your husband having already received his work permit, that

671
00:30:26,200 --> 00:30:29,160
Speaker 2: sounds like something that he should already have, if not

672
00:30:29,200 --> 00:30:32,160
Speaker 2: something that he's already applied for. But but that being said,

673
00:30:32,320 --> 00:30:35,920
Speaker 2: some brokerages actually don't even require a social Security number,

674
00:30:35,920 --> 00:30:37,800
Speaker 2: so it comes down to the individual company. It's funny.

675
00:30:38,040 --> 00:30:40,200
Speaker 2: It's funny that she's with Vanguard because they're, like you said,

676
00:30:40,200 --> 00:30:41,560
Speaker 2: I mean, they seem to be making it harder than

677
00:30:41,560 --> 00:30:44,360
Speaker 2: anyone else, more than anybody else. They're like, Vanguard is

678
00:30:44,400 --> 00:30:47,800
Speaker 2: an old curmudgeon and they don't like new things, and

679
00:30:47,840 --> 00:30:50,120
Speaker 2: they're they're playing it safe. Like if Vanguard goes out

680
00:30:50,160 --> 00:30:53,840
Speaker 2: to the restaurant, Vanguard orders steak and potatoes no matter what.

681
00:30:54,280 --> 00:30:56,200
Speaker 2: Do you want to hear the daily special? Nope, I'm

682
00:30:56,240 --> 00:30:59,560
Speaker 2: just gonna get stake, Like Vanguard does not like variety.

683
00:30:59,560 --> 00:31:00,520
Speaker 2: What about a farragus?

684
00:31:00,600 --> 00:31:00,680
Speaker 4: No?

685
00:31:01,000 --> 00:31:04,520
Speaker 2: Like nothing. So again, it's just funny that you are

686
00:31:04,880 --> 00:31:07,160
Speaker 2: with Vanguard. And of course we we love Vanguard, we

687
00:31:07,160 --> 00:31:10,000
Speaker 2: have accounts with them. But it seems maybe your husband

688
00:31:10,040 --> 00:31:12,960
Speaker 2: won't like I like this personification of Vanguard, Like what

689
00:31:12,960 --> 00:31:16,120
Speaker 2: would Vanguard order for dessert, Matt, No, no dessert for Vanguard. Really.

690
00:31:16,160 --> 00:31:19,760
Speaker 2: Oh yeah, I was gonna say Brownie ala mode. I

691
00:31:19,760 --> 00:31:22,040
Speaker 2: just picture like Charlie Munger is sitting there when I

692
00:31:22,080 --> 00:31:26,200
Speaker 2: picture Vanguard. Jack Vocal had a lot of the two

693
00:31:26,240 --> 00:31:29,880
Speaker 2: guys from the Muppets that sit up in the is

694
00:31:29,880 --> 00:31:30,600
Speaker 2: it clicking klank?

695
00:31:30,720 --> 00:31:33,760
Speaker 1: No, the car I don't remember their name. I forget

696
00:31:33,760 --> 00:31:36,160
Speaker 1: their names, but my eight year old daughter is deathly

697
00:31:36,160 --> 00:31:39,760
Speaker 1: afraid of the Muppets. Yes, it's the funniest thing ever.

698
00:31:40,240 --> 00:31:41,640
Speaker 1: It's like clowns for our generation.

699
00:31:41,800 --> 00:31:43,000
Speaker 2: Yeah. I don't know why that.

700
00:31:43,000 --> 00:31:44,680
Speaker 1: There's the guys from Car Talk, right, aren't they Yeah,

701
00:31:44,680 --> 00:31:48,840
Speaker 1: clicking clack, Yeah, that's right, And I said clanky. Okay,

702
00:31:48,840 --> 00:31:51,920
Speaker 1: So I love Vanguard's good. Hate the Vanguard sucks on this,

703
00:31:52,280 --> 00:31:54,720
Speaker 1: especially for Katie and for her husband. I don't know

704
00:31:54,720 --> 00:31:57,040
Speaker 1: why they're making it harder than other companies. But the

705
00:31:57,080 --> 00:31:59,959
Speaker 1: truth is Schwab or somebody else is going to get

706
00:31:59,960 --> 00:32:02,280
Speaker 1: the bulk of his investing dollars. And it's a bit

707
00:32:02,320 --> 00:32:04,719
Speaker 1: of a hassle, I guess. But the joke's on Vanguard here,

708
00:32:04,760 --> 00:32:08,920
Speaker 1: because one of these days their family is gonna have

709
00:32:09,240 --> 00:32:12,760
Speaker 1: like Bookoo dollars and Vanguard doesn't get to reap the rewards.

710
00:32:12,800 --> 00:32:15,960
Speaker 1: They don't get to be the custodian of that massive

711
00:32:16,080 --> 00:32:18,400
Speaker 1: nest egg moving forward. Somebody else who makes it a

712
00:32:18,400 --> 00:32:20,600
Speaker 1: little bit easier is going to win their allegiance. That's

713
00:32:20,680 --> 00:32:21,440
Speaker 1: that's how it should be.

714
00:32:21,520 --> 00:32:23,880
Speaker 2: Yeah, one of the few instances where we are not

715
00:32:24,000 --> 00:32:26,880
Speaker 2: making the Vanguard a recommendation. But Joe, we've got more

716
00:32:26,920 --> 00:32:29,160
Speaker 2: to get to here. In a second, we will take

717
00:32:29,200 --> 00:32:31,480
Speaker 2: a question from a listener to file acclaim or to

718
00:32:31,560 --> 00:32:34,080
Speaker 2: not file acclaim. We got that and more right after this.

719
00:32:42,000 --> 00:32:42,640
Speaker 2: All right, we'll back.

720
00:32:42,720 --> 00:32:45,560
Speaker 1: We've got more questions to get to on this episode.

721
00:32:46,160 --> 00:32:48,160
Speaker 1: I'm gonna talk about money stuff, of course, for the

722
00:32:48,200 --> 00:32:50,320
Speaker 1: next fifteen to twenty minutes or so. Matt, let's get

723
00:32:50,360 --> 00:32:51,440
Speaker 1: to the Facebook question.

724
00:32:51,360 --> 00:32:51,880
Speaker 2: Of the week.

725
00:32:51,960 --> 00:32:55,360
Speaker 1: This one comes from an anonymous poster who said, I'm

726
00:32:55,400 --> 00:32:58,400
Speaker 1: looking for some credit card debt advice. Is it worth

727
00:32:58,440 --> 00:33:00,480
Speaker 1: it to get a helock HOMEQ? We like to credit

728
00:33:00,880 --> 00:33:03,840
Speaker 1: or home equity loan to pay off my credit card debt.

729
00:33:04,000 --> 00:33:07,200
Speaker 1: I have about forty thousand dollars inequity and thirty thousand

730
00:33:07,200 --> 00:33:09,760
Speaker 1: dollars in credit card debt between myself and my husband,

731
00:33:10,080 --> 00:33:11,920
Speaker 1: I was wondering if a helock might be a good

732
00:33:11,960 --> 00:33:14,200
Speaker 1: route to go to get those debts paid off and

733
00:33:14,280 --> 00:33:17,360
Speaker 1: reduce the interest rates. Right now, we are able to

734
00:33:17,360 --> 00:33:19,560
Speaker 1: pay minimums except for one card that we're paying extra.

735
00:33:19,640 --> 00:33:22,240
Speaker 1: We're doing the snowball method. We don't use the cards

736
00:33:22,240 --> 00:33:25,120
Speaker 1: and we haven't for over a year. Basically hard lessons

737
00:33:25,200 --> 00:33:26,440
Speaker 1: learned from our younger times.

738
00:33:26,680 --> 00:33:30,640
Speaker 2: Okay, so this is a great debt payoff question, and

739
00:33:31,040 --> 00:33:33,640
Speaker 2: the heart of the answer it revolves around that last

740
00:33:33,720 --> 00:33:36,760
Speaker 2: little bit of information there in the post. This poster

741
00:33:36,840 --> 00:33:39,280
Speaker 2: isn't using the cards anymore, and they haven't for more

742
00:33:39,320 --> 00:33:41,880
Speaker 2: than a year. It kind of goes they've changed their waist. Yeah, yeah, yeah,

743
00:33:41,880 --> 00:33:44,400
Speaker 2: they've changed their ways. And what that shows me though,

744
00:33:44,520 --> 00:33:47,320
Speaker 2: is that they've developed some restraint. There is some behavior

745
00:33:47,360 --> 00:33:50,520
Speaker 2: modification that has taken place. They're paying off their debt

746
00:33:50,600 --> 00:33:52,520
Speaker 2: and they've got a plan. And so because of that,

747
00:33:52,560 --> 00:33:55,520
Speaker 2: the snowball method can be a great way to move forward.

748
00:33:55,760 --> 00:33:58,400
Speaker 2: If you want more in depth information on the snowball

749
00:33:58,480 --> 00:34:01,120
Speaker 2: versus the debt avalanche methods, we have an article that

750
00:34:01,480 --> 00:34:04,960
Speaker 2: we will link to within the show notes. But the

751
00:34:05,040 --> 00:34:07,400
Speaker 2: key to knowing whether or not turning credit card debt

752
00:34:07,400 --> 00:34:11,000
Speaker 2: into helock debt is the intensity. It has a lot

753
00:34:11,040 --> 00:34:12,759
Speaker 2: to do with a debt pay off timeline as well.

754
00:34:12,880 --> 00:34:15,520
Speaker 1: Yeah, for sure, but there are also other factors, right,

755
00:34:15,560 --> 00:34:17,960
Speaker 1: Because if you can't pay your credit card bill on time,

756
00:34:18,239 --> 00:34:20,920
Speaker 1: that's one thing. If you can't pay your heelock payments,

757
00:34:21,120 --> 00:34:23,560
Speaker 1: your home can end up in foreclosure if things don't

758
00:34:23,600 --> 00:34:26,839
Speaker 1: go the way you planned. So you're turning unsecured debt

759
00:34:26,960 --> 00:34:29,839
Speaker 1: into secured debt. And yes, that means a lower rate,

760
00:34:30,040 --> 00:34:31,840
Speaker 1: which can help you pay off that debt more quickly,

761
00:34:32,160 --> 00:34:35,080
Speaker 1: but it's also not like it's a zero risk endeavor

762
00:34:35,080 --> 00:34:37,799
Speaker 1: with that strategy, right, And if home values continue to

763
00:34:37,800 --> 00:34:39,320
Speaker 1: go up, and hey, you pay off that debt and

764
00:34:39,360 --> 00:34:42,319
Speaker 1: no time, no harm, no foul. But for let's say

765
00:34:42,320 --> 00:34:44,160
Speaker 1: home values go down, let's say you lose your job,

766
00:34:44,320 --> 00:34:47,279
Speaker 1: you're putting your home at risk by turning what was

767
00:34:47,360 --> 00:34:50,160
Speaker 1: credit card debt into debt against your home. So that's

768
00:34:50,360 --> 00:34:52,680
Speaker 1: something to be at least aware of before you make

769
00:34:52,719 --> 00:34:53,080
Speaker 1: this move.

770
00:34:53,160 --> 00:34:55,319
Speaker 2: Yeah, and I think there's a chance too that by

771
00:34:55,360 --> 00:34:59,120
Speaker 2: going with the helock you might slow down the snowball method.

772
00:34:59,160 --> 00:35:00,520
Speaker 2: Like right now, it feels like the have a whole

773
00:35:00,520 --> 00:35:02,400
Speaker 2: lot of momentum behind them, and because that's what the

774
00:35:02,440 --> 00:35:05,080
Speaker 2: snowball is all about. But if you switch it over

775
00:35:05,160 --> 00:35:08,240
Speaker 2: to the helock, you might lose that psychological, that mental

776
00:35:09,040 --> 00:35:12,880
Speaker 2: edge that you currently have by putting the snowball method

777
00:35:12,960 --> 00:35:15,120
Speaker 2: to work. So that's just something to keep in mind.

778
00:35:15,280 --> 00:35:17,840
Speaker 2: The bottom line, I think a balanced transfer card, I

779
00:35:17,840 --> 00:35:20,680
Speaker 2: think that is likely a better option. And again some

780
00:35:20,719 --> 00:35:23,080
Speaker 2: of this depends on the timeline, but the good news

781
00:35:23,120 --> 00:35:26,360
Speaker 2: is that you might get like fifteen, eighteen, even twenty

782
00:35:26,400 --> 00:35:29,919
Speaker 2: one months of no interest, although you do typically pay

783
00:35:29,960 --> 00:35:33,640
Speaker 2: a three percent transfer fee, but still with a like

784
00:35:33,680 --> 00:35:35,600
Speaker 2: a hard nosed dedication, I think you might be able

785
00:35:35,640 --> 00:35:38,360
Speaker 2: to get that debt close to eradicated within that window

786
00:35:38,400 --> 00:35:40,719
Speaker 2: where you're paying nothing on that And by the way,

787
00:35:41,520 --> 00:35:44,440
Speaker 2: like we mentioned earlier, a nonprofit debt counselor might make

788
00:35:44,480 --> 00:35:46,479
Speaker 2: a whole lot of sense for you as well, because

789
00:35:46,480 --> 00:35:48,680
Speaker 2: if that eighteen month window, if that sounds a bit

790
00:35:48,719 --> 00:35:51,720
Speaker 2: too short and you're facing maybe more of an uphill

791
00:35:51,760 --> 00:35:54,680
Speaker 2: climb than you might want to enlist a nonprofit professional

792
00:35:54,960 --> 00:35:57,600
Speaker 2: to help you out. Bottom Line, credit card debt sucks.

793
00:35:57,760 --> 00:35:59,680
Speaker 2: We are rooting for you to call yourself out in

794
00:35:59,719 --> 00:36:03,520
Speaker 2: record time and Honestly, I think this anonymous poster, they've

795
00:36:03,520 --> 00:36:06,279
Speaker 2: got it going on. They have learned again, they've learned

796
00:36:06,320 --> 00:36:09,160
Speaker 2: the quote unquote hard lessons from our younger times, and

797
00:36:09,200 --> 00:36:11,920
Speaker 2: it makes it seem like it's very much a different person,

798
00:36:12,040 --> 00:36:14,000
Speaker 2: you know, like that has happened in the past, that

799
00:36:14,080 --> 00:36:16,360
Speaker 2: is no longer something that they do, that is no

800
00:36:16,400 --> 00:36:17,640
Speaker 2: longer how they treat their credit card.

801
00:36:17,719 --> 00:36:19,839
Speaker 1: Something else worth mentioning is that if you have forty

802
00:36:19,840 --> 00:36:21,719
Speaker 1: thousand dollars in equity, that doesn't mean you can tap

803
00:36:21,760 --> 00:36:23,719
Speaker 1: all that equity because typically you still have to keep

804
00:36:23,760 --> 00:36:26,160
Speaker 1: twenty percent. Like, the bank doesn't want to allow you

805
00:36:26,239 --> 00:36:28,160
Speaker 1: access to some of that equity because let's say home

806
00:36:28,239 --> 00:36:29,600
Speaker 1: values do go down. They don't want you to have

807
00:36:29,840 --> 00:36:32,480
Speaker 1: one hundred percent of the home finance and find yourself underwater.

808
00:36:32,560 --> 00:36:34,920
Speaker 1: So just because you have that home equity doesn't mean

809
00:36:34,960 --> 00:36:37,520
Speaker 1: it's tappable, And even if it is tappable, it doesn't

810
00:36:37,520 --> 00:36:40,000
Speaker 1: mean that it's advisable. So I think, yes, staying the

811
00:36:40,040 --> 00:36:42,239
Speaker 1: course the way things are, trying to pay off your

812
00:36:42,239 --> 00:36:44,880
Speaker 1: debt the snowball method, but trying to do so in

813
00:36:44,920 --> 00:36:48,399
Speaker 1: a determined manner that allows you to accelerate that debt

814
00:36:48,400 --> 00:36:50,880
Speaker 1: payoff as quickly as possible. You don't necessarily have to

815
00:36:50,960 --> 00:36:52,960
Speaker 1: change the terms, and if there is a way, I think, Matt,

816
00:36:52,960 --> 00:36:55,720
Speaker 1: you're right, the balance transfer card is probably a better approach.

817
00:36:55,760 --> 00:36:58,160
Speaker 2: Yeah, that's right man. All right, Let's take another quick question.

818
00:36:58,239 --> 00:37:01,360
Speaker 2: This one is from Oaksana, and he writes, Hi, I

819
00:37:01,440 --> 00:37:03,759
Speaker 2: just cracked my windshield. Do you think it's better to

820
00:37:03,800 --> 00:37:06,200
Speaker 2: get car insurance to cover it or to pay for

821
00:37:06,280 --> 00:37:08,960
Speaker 2: it out of pocket so that my insurance doesn't go up?

822
00:37:09,280 --> 00:37:11,920
Speaker 2: It is a twenty twenty two Toyota RAV four, so

823
00:37:11,960 --> 00:37:15,239
Speaker 2: it's going to be around fifteen hundred dollars. Joel, what

824
00:37:15,239 --> 00:37:17,279
Speaker 2: do you think your spirit car? Isn't it? Matt? For

825
00:37:17,440 --> 00:37:19,719
Speaker 2: a hot minute there, I was really wanting a late

826
00:37:19,760 --> 00:37:22,000
Speaker 2: model you were aw four. I don't know why. Dare

827
00:37:22,040 --> 00:37:24,239
Speaker 2: I say lusting after rav Force for a while. I'm

828
00:37:24,239 --> 00:37:26,080
Speaker 2: just glad we weren't put in a position to where

829
00:37:26,120 --> 00:37:28,560
Speaker 2: we actually needed the second vehicle because I've been able

830
00:37:28,640 --> 00:37:32,040
Speaker 2: to maintain the one car household. But if we were

831
00:37:32,080 --> 00:37:33,840
Speaker 2: in a position to where we needed that second vehicle,

832
00:37:33,880 --> 00:37:36,640
Speaker 2: instead of buying like a five thousand dollars beater, I

833
00:37:36,680 --> 00:37:39,439
Speaker 2: would have instead probably dropped like twenty five thousand, Yeah,

834
00:37:39,480 --> 00:37:43,240
Speaker 2: thirty five thousand on something maybe that I didn't necessarily need. Yeah,

835
00:37:43,280 --> 00:37:44,560
Speaker 2: and I think I may have regretted it. That's what

836
00:37:44,560 --> 00:37:44,879
Speaker 2: I'm saying.

837
00:37:44,920 --> 00:37:47,200
Speaker 1: I took the Beata route. We got a second car,

838
00:37:47,280 --> 00:37:47,960
Speaker 1: That's what'm talking about.

839
00:37:47,960 --> 00:37:49,480
Speaker 2: It's working out. It's working out well so far. I

840
00:37:49,520 --> 00:37:49,799
Speaker 2: love it.

841
00:37:50,000 --> 00:37:52,359
Speaker 1: But Okay, this is a good question. It's the kind

842
00:37:52,400 --> 00:37:54,439
Speaker 1: of practical conundrum, Matt, I think a lot of people

843
00:37:54,480 --> 00:37:57,600
Speaker 1: face all the time. It's the minor damage to the

844
00:37:57,680 --> 00:38:00,640
Speaker 1: home or car. Do I use my insurance pol or

845
00:38:00,680 --> 00:38:03,560
Speaker 1: do I self insure? And I would say the TLDR

846
00:38:03,680 --> 00:38:06,440
Speaker 1: the too long don't read is don't do it. But

847
00:38:06,480 --> 00:38:08,120
Speaker 1: it also depends on where you live, because I will

848
00:38:08,120 --> 00:38:11,040
Speaker 1: say this, in some states, insurance companies are required to

849
00:38:11,080 --> 00:38:13,640
Speaker 1: fix your busted windshield and they're not allowed to jack

850
00:38:13,719 --> 00:38:15,880
Speaker 1: up your rates. I didn't know about this until I

851
00:38:15,960 --> 00:38:18,239
Speaker 1: think my friend lived in Virginia and you have like

852
00:38:18,239 --> 00:38:20,279
Speaker 1: a crack in his windshield, and they have, like by

853
00:38:20,280 --> 00:38:22,279
Speaker 1: state law, they have to get their car inspected every year.

854
00:38:22,680 --> 00:38:24,960
Speaker 1: Cracked windshields are one of those things where you have

855
00:38:25,000 --> 00:38:26,520
Speaker 1: to get it fixed asap.

856
00:38:26,600 --> 00:38:27,960
Speaker 2: That's true. So it depends on where you live. I

857
00:38:27,960 --> 00:38:30,240
Speaker 2: guess South Carolina is one of those states. Okay, well,

858
00:38:30,920 --> 00:38:33,600
Speaker 2: but there are many of them. Yeah, yeah, exactly. It's rare,

859
00:38:33,640 --> 00:38:35,520
Speaker 2: but it's something to at least be on the lookout for.

860
00:38:35,560 --> 00:38:38,719
Speaker 2: I don't know where Oaksana lives, but yeah, if there's

861
00:38:38,719 --> 00:38:40,879
Speaker 2: no deductible required on your end and they can't jack

862
00:38:40,920 --> 00:38:44,319
Speaker 2: up your rates for replacing that windshield, look into that first.

863
00:38:44,400 --> 00:38:46,920
Speaker 2: Make sure that's not the case. But yeah, in most states,

864
00:38:46,960 --> 00:38:48,840
Speaker 2: you're gonna have to pay deductible, You're gonna have to

865
00:38:48,880 --> 00:38:51,040
Speaker 2: fork over some money, and you might also see your

866
00:38:51,080 --> 00:38:54,239
Speaker 2: premiums go up at the same time for making that claim. Yeah,

867
00:38:54,400 --> 00:38:55,879
Speaker 2: so I think there is a lot to consider. Because

868
00:38:55,880 --> 00:38:58,680
Speaker 2: you said that you probably wouldn't do it. I think

869
00:38:58,719 --> 00:39:01,880
Speaker 2: it like I might considerate, And it depends on a

870
00:39:01,920 --> 00:39:04,440
Speaker 2: few things. I'll say, Like, generally speaking, the way we

871
00:39:04,520 --> 00:39:06,279
Speaker 2: like to approach insurance is that it's something that you

872
00:39:06,320 --> 00:39:10,960
Speaker 2: don't use. We encourage folks to raise your deductibles. With

873
00:39:11,080 --> 00:39:13,439
Speaker 2: that you're gonna see your premiums decrease, and you put

874
00:39:13,480 --> 00:39:16,120
Speaker 2: those excess savings within your savings account so that you're

875
00:39:16,160 --> 00:39:18,600
Speaker 2: able to self ensure to a certain extent. Definitely, don't

876
00:39:18,640 --> 00:39:21,839
Speaker 2: use the life insurance to stay alive. Yeah, uh yeah,

877
00:39:21,880 --> 00:39:24,080
Speaker 2: don't let the tail like the dog here. But the

878
00:39:24,120 --> 00:39:26,600
Speaker 2: reason I say I might consider it, so assuming that's

879
00:39:26,600 --> 00:39:29,040
Speaker 2: basically how we want folks to to use their insurance,

880
00:39:29,080 --> 00:39:31,400
Speaker 2: but a general approach. Yeah, But that being said, not

881
00:39:31,480 --> 00:39:34,440
Speaker 2: everyone has taken those steps. And I think there are

882
00:39:34,680 --> 00:39:38,440
Speaker 2: two different factors that might cause me to say, okay,

883
00:39:38,480 --> 00:39:40,520
Speaker 2: go ahead and make the claim. Well, first of all,

884
00:39:40,640 --> 00:39:43,480
Speaker 2: fifteen hundred dollars, that's like a crazy expensive windshield. Like

885
00:39:43,560 --> 00:39:45,359
Speaker 2: last time I replaced the windshield, it is like three

886
00:39:45,400 --> 00:39:48,840
Speaker 2: hundred dollars, and so I don't understand why it's costing

887
00:39:48,920 --> 00:39:50,759
Speaker 2: you that much money, and so I don't know. I

888
00:39:50,880 --> 00:39:53,319
Speaker 2: might recommend going and getting another quote first of all,

889
00:39:53,320 --> 00:39:56,400
Speaker 2: because that just seems incredibly steep. But if you are

890
00:39:56,440 --> 00:39:58,759
Speaker 2: someone who has not yet raised your deductible and you've

891
00:39:58,760 --> 00:40:02,200
Speaker 2: been paying on your car insurance and you've had higher

892
00:40:02,239 --> 00:40:04,600
Speaker 2: premiums because you've got like a one hundred dollars deductible

893
00:40:04,640 --> 00:40:08,080
Speaker 2: set aside, so A that's a first consideration, But B,

894
00:40:08,719 --> 00:40:11,600
Speaker 2: I would only consider pulling the trigger if you've not

895
00:40:11,680 --> 00:40:14,320
Speaker 2: made a claim anytime recently, like definitely not in the

896
00:40:14,320 --> 00:40:16,799
Speaker 2: past year. But honestly, even in the past couple two

897
00:40:16,920 --> 00:40:17,680
Speaker 2: or three years.

898
00:40:17,480 --> 00:40:18,920
Speaker 1: Because I make claim on this and then you have

899
00:40:18,960 --> 00:40:21,000
Speaker 1: another claim six months down the road, and hey, I

900
00:40:21,040 --> 00:40:23,280
Speaker 1: mean like then it puts you in the really negative category.

901
00:40:23,360 --> 00:40:24,880
Speaker 2: It could put you in a really bad position. But

902
00:40:25,120 --> 00:40:27,440
Speaker 2: so much of it depends on the individual ensure, like

903
00:40:27,480 --> 00:40:28,839
Speaker 2: no matter what, it's going to show up on your

904
00:40:28,840 --> 00:40:31,440
Speaker 2: clue report. But as to but again, because this is

905
00:40:31,440 --> 00:40:34,560
Speaker 2: a no fault claim, it's not like you were speeding

906
00:40:34,600 --> 00:40:36,479
Speaker 2: and you ran a red light and you've told somebody

907
00:40:36,480 --> 00:40:38,719
Speaker 2: else's vehicle and by the way, you told yours as well.

908
00:40:39,080 --> 00:40:41,160
Speaker 2: That is looked at a whole lot differently by the

909
00:40:41,200 --> 00:40:43,879
Speaker 2: insurers than something like a glass replacement with it being

910
00:40:44,280 --> 00:40:47,120
Speaker 2: a no fault claim. So with that mind, I would

911
00:40:47,160 --> 00:40:49,680
Speaker 2: consider it because again, fifteen hundred dollars it's more than

912
00:40:49,880 --> 00:40:52,080
Speaker 2: I would have expected to replace the twenty twenty two

913
00:40:52,160 --> 00:40:55,359
Speaker 2: rould or windshield. But at the same time, I don't know,

914
00:40:55,440 --> 00:40:58,600
Speaker 2: I might be willing to essentially take the gamble if

915
00:40:58,760 --> 00:41:01,640
Speaker 2: you do have a lower a lower deductible set, it's

916
00:41:02,000 --> 00:41:03,440
Speaker 2: not worth it if your deductibles is higher. If you

917
00:41:03,440 --> 00:41:06,160
Speaker 2: have a thousand dollars deductible Oh, absolutely, not no way, Jose. Yeah,

918
00:41:06,200 --> 00:41:08,440
Speaker 2: but a lot of folks keep their deductibles between like

919
00:41:08,480 --> 00:41:09,759
Speaker 2: one five third bucks.

920
00:41:09,800 --> 00:41:12,640
Speaker 1: Yeah, and which makes which makes me shudder, because I

921
00:41:12,640 --> 00:41:14,640
Speaker 1: think most people should have deductibles exactly.

922
00:41:14,680 --> 00:41:15,719
Speaker 2: That's not how you want to approach it.

923
00:41:15,680 --> 00:41:17,279
Speaker 1: You need at least run the numbers, figure out how

924
00:41:17,320 --> 00:41:19,920
Speaker 1: much you could save by jacking your deductible up. But

925
00:41:19,920 --> 00:41:21,680
Speaker 1: I think you're right man. You mentioned Matt the Clue Report,

926
00:41:21,680 --> 00:41:23,880
Speaker 1: and most people are probably like, huh, what's that? Because

927
00:41:24,200 --> 00:41:26,160
Speaker 1: I think the average person is not familiar with what

928
00:41:26,200 --> 00:41:28,759
Speaker 1: the Clue Report is. And it's essentially this database.

929
00:41:28,920 --> 00:41:29,520
Speaker 2: What does it stayed for?

930
00:41:29,680 --> 00:41:33,319
Speaker 1: Run by Lexus Nexus. It stands for Comprehensive Loss and

931
00:41:33,440 --> 00:41:34,520
Speaker 1: Underwriting Exchange.

932
00:41:34,560 --> 00:41:38,400
Speaker 2: Okay, I have guess comprehensive liability. I would not have

933
00:41:38,480 --> 00:41:41,799
Speaker 2: remember what he stands for. Yeah, so it's it's this.

934
00:41:41,960 --> 00:41:44,719
Speaker 1: It's this database essentially that all the insurers are in

935
00:41:44,800 --> 00:41:48,200
Speaker 1: putting claims into so that you file a claim Matt,

936
00:41:48,239 --> 00:41:50,640
Speaker 1: let's say two years ago, or let's literally go with

937
00:41:50,680 --> 00:41:52,880
Speaker 1: my real life example, filing the claim for the homeowners

938
00:41:52,880 --> 00:41:55,200
Speaker 1: insurance claim when the tree fell through my roof. Well,

939
00:41:55,280 --> 00:41:58,160
Speaker 1: if I try to go get another insurance policy now

940
00:41:58,480 --> 00:42:00,880
Speaker 1: and leave the insurer i'm currently with. What they're going

941
00:42:00,960 --> 00:42:03,360
Speaker 1: to do is check my clue report and they're gonna say,

942
00:42:03,600 --> 00:42:05,719
Speaker 1: wait a second, dude, I don't know if we want

943
00:42:05,760 --> 00:42:07,279
Speaker 1: you as our customer because you file a claim a

944
00:42:07,280 --> 00:42:07,920
Speaker 1: couple of years ago.

945
00:42:08,120 --> 00:42:10,719
Speaker 2: This guy's a filer, right, this guy's a claimer. Yeah.

946
00:42:11,000 --> 00:42:12,879
Speaker 1: And let's say you get a couple of claims on there,

947
00:42:13,000 --> 00:42:14,839
Speaker 1: they're gonna think long and hard about whether they want

948
00:42:14,840 --> 00:42:16,040
Speaker 1: you to be a customer, and they're going to jack

949
00:42:16,080 --> 00:42:19,439
Speaker 1: up your rates accordingly. So it might kind of force

950
00:42:19,520 --> 00:42:21,760
Speaker 1: you to stay in a relationship with your current insure

951
00:42:22,200 --> 00:42:25,080
Speaker 1: you and you might not be able to benefit from

952
00:42:25,320 --> 00:42:28,000
Speaker 1: shopping around and saving if your rates continue to creep

953
00:42:28,080 --> 00:42:30,600
Speaker 1: up with that ensure. By not filing, you're playing the

954
00:42:30,600 --> 00:42:31,200
Speaker 1: longer game.

955
00:42:31,360 --> 00:42:31,520
Speaker 2: Yep.

956
00:42:31,600 --> 00:42:34,200
Speaker 1: The short term benefit is you save some money right now,

957
00:42:34,520 --> 00:42:36,920
Speaker 1: but the long term benefit if you don't file a

958
00:42:36,920 --> 00:42:39,040
Speaker 1: claim might be that you save more money over the

959
00:42:39,080 --> 00:42:39,480
Speaker 1: long run.

960
00:42:39,680 --> 00:42:43,279
Speaker 2: Exactly. Yeah. And again, because because this is glass, it's

961
00:42:43,280 --> 00:42:45,279
Speaker 2: one thing if you've never made a claim before and

962
00:42:45,320 --> 00:42:48,800
Speaker 2: you file a glass replacement claim like this. It's another

963
00:42:48,840 --> 00:42:50,400
Speaker 2: thing if you do that every single year for like

964
00:42:50,480 --> 00:42:53,480
Speaker 2: four years. Yeah, because they I mean, they build, they compound,

965
00:42:53,560 --> 00:42:56,520
Speaker 2: sure and ensures take that into account as well. We've

966
00:42:56,520 --> 00:42:58,640
Speaker 2: never talked about it as you have. You seen that

967
00:42:58,680 --> 00:43:01,000
Speaker 2: your home insurance has gone up because of that claim.

968
00:43:01,320 --> 00:43:04,560
Speaker 1: It really has not been impacted in a massive way.

969
00:43:04,600 --> 00:43:06,040
Speaker 2: Yet you're like, please don't check it.

970
00:43:06,719 --> 00:43:10,440
Speaker 1: Yeah, exactly, So, I mean I know that it's if

971
00:43:10,480 --> 00:43:11,920
Speaker 1: I were to shop around, I'm guessing you would have

972
00:43:11,920 --> 00:43:13,680
Speaker 1: an impact then, because it's like a.

973
00:43:13,600 --> 00:43:14,960
Speaker 2: Fresh poll of the reboard.

974
00:43:15,000 --> 00:43:17,400
Speaker 1: That's something that they're looking at, exactly. But for the

975
00:43:17,440 --> 00:43:19,480
Speaker 1: time being, I haven't good for him. It's just been

976
00:43:19,520 --> 00:43:22,000
Speaker 1: like the standard what like fifteen percent increase that everyone's

977
00:43:21,960 --> 00:43:24,080
Speaker 1: saying yeah right now, but it doesn't seem to have

978
00:43:24,239 --> 00:43:25,399
Speaker 1: anything beyond that.

979
00:43:25,400 --> 00:43:28,000
Speaker 2: That's good. Yeah, just the standard hike. Glad you're not

980
00:43:28,040 --> 00:43:30,440
Speaker 2: having to pay off the nose. The standard hike these

981
00:43:30,520 --> 00:43:32,600
Speaker 2: days is just honestly, feel like you're paying out the

982
00:43:32,600 --> 00:43:33,759
Speaker 2: nose even with the standard pike.

983
00:43:33,840 --> 00:43:35,680
Speaker 1: Yeah, and everyone's feeling it right now. It's like, what

984
00:43:35,719 --> 00:43:39,040
Speaker 1: the number one factor influencing inflation right now is insurance.

985
00:43:39,080 --> 00:43:41,359
Speaker 2: It's it's tough, it is, all right, let's get back

986
00:43:41,360 --> 00:43:43,640
Speaker 2: to our beer. You and I enjoyed a Heineken silver.

987
00:43:44,520 --> 00:43:48,120
Speaker 2: It says on here Joel refreshing taste. It said, extra

988
00:43:48,280 --> 00:43:50,520
Speaker 2: refreshing taste. I believe. Oh it does it? Yeah, Oh

989
00:43:50,520 --> 00:43:55,600
Speaker 2: it does yeah. Yeah. Which it's like flavor has it. Yeah,

990
00:43:56,040 --> 00:43:59,680
Speaker 2: it's like it's like gum marketing almost Oh my gosh, chewy,

991
00:44:00,480 --> 00:44:02,640
Speaker 2: like oh yeah, what are your thoughts on this? I

992
00:44:02,640 --> 00:44:05,440
Speaker 2: don't have many good ones? This was crazy. This is

993
00:44:05,440 --> 00:44:06,879
Speaker 2: the worst of the craft beers we've had. I think

994
00:44:06,880 --> 00:44:08,680
Speaker 2: you think, so I do. It's odd. I don't necessarily

995
00:44:08,719 --> 00:44:09,840
Speaker 2: know how to explain it because it doesn't have a

996
00:44:09,880 --> 00:44:12,000
Speaker 2: whole lot of flavor. But the flavor that is there

997
00:44:12,239 --> 00:44:14,239
Speaker 2: is off putting. It's kind of harsh. It's kind of like,

998
00:44:14,680 --> 00:44:17,399
Speaker 2: uh yeah, it's kind of like caustic or something. Okay,

999
00:44:17,400 --> 00:44:17,920
Speaker 2: So I don't know.

1000
00:44:18,040 --> 00:44:20,759
Speaker 1: Yeah, I guess I'm struggling to understand why beers like

1001
00:44:20,800 --> 00:44:23,680
Speaker 1: this stick around, because for a long time we didn't

1002
00:44:23,719 --> 00:44:26,120
Speaker 1: have tasty non alcoholic beers, but now we do, right

1003
00:44:26,200 --> 00:44:28,360
Speaker 1: with like Athletic Brewing Company and stuff like that. So

1004
00:44:28,760 --> 00:44:33,320
Speaker 1: who is still turning to the really poorly made local

1005
00:44:33,560 --> 00:44:36,080
Speaker 1: Heineken beers when you can get something that's local and

1006
00:44:36,120 --> 00:44:39,640
Speaker 1: actually tasty and maybe you want, I guess to still

1007
00:44:39,640 --> 00:44:43,520
Speaker 1: be drinking alcohol. Well, there's better versions of like low

1008
00:44:44,120 --> 00:44:45,640
Speaker 1: calorie alcohol than this too, So.

1009
00:44:45,920 --> 00:44:48,960
Speaker 2: Different craft brewers out there that are making lighter, light

1010
00:44:49,080 --> 00:44:49,719
Speaker 2: gravity beers.

1011
00:44:49,760 --> 00:44:52,040
Speaker 1: Yeah, so this to me is in a is in

1012
00:44:52,080 --> 00:44:54,000
Speaker 1: a category that should be defunct.

1013
00:44:55,280 --> 00:44:57,360
Speaker 2: But if you're somewhere and you've got some spicy wings

1014
00:44:57,600 --> 00:45:00,680
Speaker 2: and you're you're gonna order a pitcher or something like,

1015
00:45:00,760 --> 00:45:02,359
Speaker 2: that's the kind of pick a better light beer. That's

1016
00:45:02,360 --> 00:45:04,439
Speaker 2: the kind of scenario where you're gonna order a light beer.

1017
00:45:04,440 --> 00:45:06,400
Speaker 2: It's it's something that, yeah, you don't necessarily want a

1018
00:45:06,400 --> 00:45:08,080
Speaker 2: whole lot of flavor, but you do want it to

1019
00:45:08,080 --> 00:45:12,799
Speaker 2: be wet. And this beer that's why these things, these

1020
00:45:12,840 --> 00:45:15,439
Speaker 2: beers are more they're so affordable as well, because there's

1021
00:45:15,520 --> 00:45:17,719
Speaker 2: just mostly I mean, I guess all beer is mostly water,

1022
00:45:18,000 --> 00:45:20,680
Speaker 2: but these beers more than any other craft beer. It's

1023
00:45:20,719 --> 00:45:24,320
Speaker 2: like it has a higher water ratio the ingredients.

1024
00:45:23,960 --> 00:45:27,279
Speaker 1: Pour twelve ounces of water in it, so and then

1025
00:45:27,440 --> 00:45:30,040
Speaker 1: blended it together. Just switch the can around. But yeah,

1026
00:45:30,040 --> 00:45:32,560
Speaker 1: we'll get back to again good craft beer soon on

1027
00:45:32,600 --> 00:45:35,960
Speaker 1: the show. Only Yeah, all right, that's gonna do it

1028
00:45:35,960 --> 00:45:37,239
Speaker 1: for this one though. And and by the way, If

1029
00:45:37,280 --> 00:45:39,719
Speaker 1: you have a money question, please do send it our way.

1030
00:45:39,880 --> 00:45:41,920
Speaker 1: You just record your voice membo shoot it, shoot it

1031
00:45:41,920 --> 00:45:43,759
Speaker 1: over to us via email at how to Moneypod at

1032
00:45:43,760 --> 00:45:46,480
Speaker 1: gmail dot com. That's right, but that's gonna be it

1033
00:45:46,480 --> 00:45:48,239
Speaker 1: for this episode. You can find show notes up on

1034
00:45:48,280 --> 00:45:51,600
Speaker 1: the website at howtomoney dot com. But until next time,

1035
00:45:52,000 --> 00:45:54,760
Speaker 1: best friends out, Best Friends out.

1036
00:46:00,760 --> 00:46:05,920
Speaker 2: The only, the only speak