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Speaker 1: Welcome to How the Money. I'm Joel and I am

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Speaker 1: that today we're discussing defy disaster, forgiveness, freeze, and degree displeasure.

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Speaker 1: That's right, Joel. This is our Friday flight where every

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Speaker 1: single Friday, we sit down and we talk about some

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Speaker 1: of the best stories that we came across this past week,

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Speaker 1: and specifically we're going to dissect and talk about how

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Speaker 1: they are going to impact our listeners finances. You said

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Speaker 1: that we sit down. By the way, maybe we should

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Speaker 1: stand up next week. I like sitting down. When I

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Speaker 1: laid down next week, I eat standing up. Uh you

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Speaker 1: like to sit down while you Yeah, But personally, when

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Speaker 1: I do sit down all day at the computer, I

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Speaker 1: like to stay in eat. I get that all right, Well, yeah,

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Speaker 1: I roll. Before we get to all the stories, I

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Speaker 1: wanted to mention that listener, Tyler, he emailed us this

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Speaker 1: week about the company that he invests through Betterment and

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Speaker 1: how they're raising fees on folks who have small account balances.

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Speaker 1: I was satten to hear this. Well first, Tyler, thanks

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Speaker 1: for reaching out leting us know something I saw later

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Speaker 1: on Twitter, but it was just it's one of those

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Speaker 1: things that it makes it it bumps me out because

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Speaker 1: I love what Betterment is doing in the robo advisor space.

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Speaker 1: I think they're probably the best in that business. But

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Speaker 1: let's say you have an account balance of ten thou

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Speaker 1: dollars right now. With Betterment, the fees that you were

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Speaker 1: being charged were roughly like annually, and now you're gonna

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Speaker 1: be charged forty eight dollars a year. So so there's

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Speaker 1: a flat monthly fee of four more doll for any

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Speaker 1: balance that's under twenty dollars, which is totally lame. That

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Speaker 1: really sucks. Yeah, and I like the flat fee idea

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Speaker 1: that Betterment has been doing the quarter of a presentage,

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Speaker 1: right that's that's a reasonable rate for a robo advisor

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Speaker 1: to charge. And to see that they're now basically taking

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Speaker 1: it out on people who have really small balances what

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Speaker 1: you're hoping to get those customers so their balances eventually

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Speaker 1: do become large. And and our listener Tyler said, I'm

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Speaker 1: picking my money elsewhere now. That's just because of this,

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Speaker 1: And and I don't think it's a bad move, because

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Speaker 1: fees are they eat into your your returns as an investor.

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Speaker 1: They're something that you should run away from whenever you can.

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Speaker 1: When you can avoid them. And it's the reality is

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Speaker 1: there's going to be some amount of investing fee almost

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Speaker 1: anywhere you go, right. Even our faves like Vanguard and

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Speaker 1: Fidelity have fees on most of their finds fees, reasonable fees.

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Speaker 1: That's the problem here because yeah, like on smaller balances,

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Speaker 1: I mean that four dollar flat fee is taking a

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Speaker 1: pretty big bite of Like it starts entering into the

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Speaker 1: one percent annual fee territory with with some of those

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Speaker 1: lower balances, which is yeah, it starts to get to

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Speaker 1: be a bit unreasonable. Joel, Let's get to our stories

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Speaker 1: this week. This first one has to do with student loans.

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Speaker 1: This is just a quick update I guess on folks

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Speaker 1: with on this story, Matt, because as we speak it

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Speaker 1: is in Harold yet again. So last Thursday at Texas

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Speaker 1: judge struck down the Biden administration's plan to forgive ten

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Speaker 1: thousand dollars of student loans, plus that additional ten thousand

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Speaker 1: dollars for pel grant recipients. And then earlier this week

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Speaker 1: a federal appeals court blocked the student loan forgiveness plan

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Speaker 1: for moving forward. According to the Journal, this is a

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Speaker 1: much bigger setback because it actually suspends the forgiveness program

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Speaker 1: while the case is being decided. It gets kind of complicated,

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Speaker 1: but the appellate courts will have to issue a ruling

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Speaker 1: that then determines whether or not forgiveness can continue to

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Speaker 1: move forward, while it's then likely to be appealed to

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Speaker 1: the Supreme Court. It's it's all kind of a mess.

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Speaker 1: It's a jumbled mess. But there's a likelihood that student

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Speaker 1: loan Forgiveness doesn't make it, as evidence by the fact

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Speaker 1: that the Student aid dot gov website it's no longer

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Speaker 1: accepting new applications. So this is not a great sign.

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Speaker 1: Hopefully this is something that student loan borrowers will be

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Speaker 1: able to count on in the future. But well, I

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Speaker 1: guess what we'd say is, don't count on it right now.

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Speaker 1: We want you to start preparing, start mentally getting yourself

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Speaker 1: ready for that possibility. And well, you know what, we'll

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Speaker 1: keep you up to speed with every every twist and

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Speaker 1: turn that happens in the student loan forgiveness story. But yeah,

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Speaker 1: you're right, Matt. I hope, hope none of our listeners

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Speaker 1: went out and spent the forgiveness money before it actually

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Speaker 1: came through, counting their chickens before they hatched. Something that

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Speaker 1: we talked about was a legally nebulous sort of move,

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Speaker 1: and it looks like this might not move forward as promised.

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Speaker 1: We will will continue to follow it though, and it's

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Speaker 1: it's it's interesting. Apparently the Biden administration is considering extending

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Speaker 1: the student loan payment pause, so that's something else for it.

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Speaker 1: I wouldn't plan on it. I would plan on student

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Speaker 1: loan payments resuming come January one, but that's one of

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Speaker 1: those things that maybe that'll be the gift that you get, uh,

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Speaker 1: if you don't get the forgiveness. Let's talk about crypto

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Speaker 1: here for a second, map because it's it has had

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Speaker 1: a heck of a week and a half at one

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Speaker 1: of the biggest exchanges, f t X, which had actually

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Speaker 1: bailed out their troubled crypto firms in the past, experienced

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Speaker 1: its own meltdown thanks to what I would call like

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Speaker 1: a Bernie made Off esque action or actions by its founder,

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Speaker 1: Sam Bankman Freed, who goes by SPF right so everybody

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Speaker 1: calls him, but which I'm sure by now a lot

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Speaker 1: of folks have seen these names in the headlines, but

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Speaker 1: you're probably thinking this has nothing to do with me.

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Speaker 1: But it actually might, especially if you've got some money

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Speaker 1: within the crypto space. Yeah for sure, yea that there

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Speaker 1: could be ramifications for unforeseen time to come based on

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Speaker 1: what has happened with ft X, which is now filed

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Speaker 1: for bankruptcy and then its former multi billionaire founder SPF

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Speaker 1: has resigned and the authorities are are looking for him,

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Speaker 1: it appears. But the question is is whether f t

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Speaker 1: x users are going to be able to get their

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Speaker 1: money out of their account And it looks like billions

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Speaker 1: of dollars matt from tens of thousands of people are

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Speaker 1: going to be lost, are going to be wiped out

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Speaker 1: based on the actions of its founder. And when one

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Speaker 1: of those stalwart crypto exchanges bites the dust overnight like this,

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Speaker 1: it shines a spotlight on an industry that we would

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Speaker 1: say acts quite a bit of trustworthiness. Uh, faith in

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Speaker 1: crypto as an asset class seems to be diminishing. And

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Speaker 1: so it just reminds me of our conversation recently with

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Speaker 1: Stacy Marie Ishmael. We we asked the question that is

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Speaker 1: crypto dying, like is it is it a dead medium

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Speaker 1: of exchange? And what does the future look like for

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Speaker 1: and I think Stacy had some great insights, but it's

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Speaker 1: just hard to tell. It's hard for us to know.

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Speaker 1: But it is another great reminder that a very small

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Speaker 1: amounts of your investment dollars belong in the crypto space,

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Speaker 1: if any. Right, and so just because the price of

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Speaker 1: something is going up, that does not mean that it

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Speaker 1: has an underlying value. I think a lot of people

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Speaker 1: got taken for that over the past couple of years, Matt.

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Speaker 1: But this is a space where how the money listeners

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Speaker 1: seemed to be very careful, and this might be a

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Speaker 1: place where you want to trim back your exposure right

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Speaker 1: now to crypto, even if you know your crypto holdings

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Speaker 1: are have gone down in value. Sure, yeah, and not

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Speaker 1: the very least. This is I'm sure given Stacy Marie

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Speaker 1: Ishmael plenty to talk about on her podcast about crypto,

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Speaker 1: she's having a hey day. Uh so all the note

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Speaker 1: to crypto Fidelity is actually going to start offering commission

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Speaker 1: free crypto trading. And I'm not sure that anyone cares

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Speaker 1: about this. We like, we're we're always yeah, I mean

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Speaker 1: like we are happy to see fees going down, right,

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Speaker 1: like fees four investors, which is what Fidelity is great

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Speaker 1: at but the truth is that fee free trades also

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Speaker 1: often result in actually even more trading. And you know,

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Speaker 1: we would love to see how the money listeners maybe

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Speaker 1: just doing in itsy bitsy amount of crypto trading, not

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Speaker 1: uh an extraordinary amount. So hopefully the launch of Fidelity

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Speaker 1: Crypto it'll be maybe it'll be met with very little fanfare,

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Speaker 1: because again NIDE five plus percent of your focus should

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Speaker 1: be on time tested investments like investing in the broader

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Speaker 1: American economy and the world economies via easy to understand

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Speaker 1: products like index funds. Uh So, just because you can

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Speaker 1: trade crypto and not pay any commissions, this doesn't mean

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Speaker 1: that you should just because it's available to you. Although, say,

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Speaker 1: maybe one silver lining is the fact that hopefully Fidelity,

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Speaker 1: since they've been around, I think since like the nineteen forties,

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Speaker 1: maybe they can interject some some faith that, like you said,

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Speaker 1: is stability waning. That it feels like crypto's crumbling right now,

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Speaker 1: and I think, like I feel like I picture a

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Speaker 1: parent walking into a room of a bunch of kidnergardeners

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Speaker 1: just creating full on chaos and they're trying to play

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Speaker 1: a game and it is not going well. But if

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Speaker 1: a parent can kind of step into the room, set

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Speaker 1: the rules a little bit, provide some guidance, I think

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Speaker 1: that that could be a way where everyone's having a

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Speaker 1: lot more fun at the end of the day. Well,

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Speaker 1: you know, the space also might require more regulation for

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Speaker 1: people to have more trust too, So I think you're right.

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Speaker 1: I think fidelity jumping in maybe helps lend some credence

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Speaker 1: to the reality that crypto might be around for a

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Speaker 1: longer period of time then some folks might think. But

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Speaker 1: it might take more than that to to study the

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Speaker 1: water space. Let's talk about something else now, this one.

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Speaker 1: I saw this article called about cash stuffing in the

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Speaker 1: New York Times, and I've never heard of it before.

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Speaker 1: So I was like, well, okay, I'm as a money nerd,

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Speaker 1: I mean to figure out what this means. Sells right

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Speaker 1: up our alley. Yeah, I was like, cash stuffing cool,

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Speaker 1: But basically it's just a cute name for something that's

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Speaker 1: been around a long time. The cash envelope budgeting system

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Speaker 1: under a new name is now called cash stuffing. Of course,

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Speaker 1: thanks to the good folks on TikTok, but a lot

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Speaker 1: of folks have had their budgets squeezed quite a bit

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Speaker 1: more over the past year or so, largely thanks to inflation,

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Speaker 1: And it makes a lot of sense to try and

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Speaker 1: find a new method of tracking your spending if you're

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Speaker 1: finding dollars slipping through the cracks, like if you've been

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Speaker 1: using the same old system and you find yourself like

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Speaker 1: over spending every single month, well, cash budgeting with an

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Speaker 1: ovelos system, it can really help provide the discipline and

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Speaker 1: structure that some folks need in order to use their

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Speaker 1: money effectively to make sure that they're you know, not

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Speaker 1: spending two tremlessly. And some studies have shown that parting

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Speaker 1: with cash is a bit more painful in a good way, right,

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Speaker 1: because the pain we feel when we are tangibly and

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Speaker 1: physically parted with our dollars leads us to wanting to

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Speaker 1: do it less like it leads us to inhibit our spending,

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Speaker 1: which yeah, so so cash stuffing or the cash envelope

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Speaker 1: budgeting system for some people, Matt, it might be the

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Speaker 1: right choice. I kind of like the sound of cash

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Speaker 1: stuffing better than the cash cash envelopes as well, because

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Speaker 1: I don't know, you just like shoving that cash and

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Speaker 1: whatever sort of container that you want to um. Although

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Speaker 1: so you're talking about the pain that folks feel. This

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Speaker 1: reminds me we've had younger listeners off their reach out

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Speaker 1: and actually say the opposite, right like that, because they

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Speaker 1: interact with cash so rarely that's spending it, it feels

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Speaker 1: far less painful. It's almost like pretend money to them,

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Speaker 1: because it's not something that they're used to participating with,

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Speaker 1: are used to like looking at only at the representative numbers,

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Speaker 1: and so physical cash when it comes in their hands,

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Speaker 1: it gets it goes out of them pretty quickly. Yeah. Yeah,

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Speaker 1: and you know, we talked about this actually back in

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Speaker 1: episode nine. But your method of payment it matters when

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Speaker 1: it comes to not just the rewards, but the protections

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Speaker 1: that you're offered as well. Right Like, it's it's possible

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Speaker 1: to drop that cash stuffed envelope on your way to

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Speaker 1: the grocery store and when someone finds it and they

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Speaker 1: spend it, like that money is gone. But if you

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Speaker 1: drop a credit card someone goes on to spending spree,

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Speaker 1: well those are fraudulent charges, of course, and you are

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Speaker 1: not responsible at all. Now, if you have trouble not

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Speaker 1: going overboard with your own spending spree, well then we

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Speaker 1: don't want you using them. Don't use those credit cards.

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Speaker 1: But for everyone else out there, you're going to get

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Speaker 1: superior rewards and purchase protection when you use a credit

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Speaker 1: card as opposed to cash or even debit cards. A

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Speaker 1: lot of folks think that well, debit cards, you know,

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Speaker 1: they give you that protection as well, but in reality

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Speaker 1: they don't. You're actually on the hook for more of

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Speaker 1: the money for a longer period of time before those

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Speaker 1: charges are proven to be fraudulent. And the great thing

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Speaker 1: about when you use a credit card is the money

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Speaker 1: is not actually taking out of your account. You're not

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Speaker 1: parted with it trying to call it back, whereas with

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Speaker 1: a debit card name you are, you're trying to fight

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Speaker 1: the bank for your to get that money back in

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Speaker 1: your hands. So yeah, cash stuffing might make sense for you.

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Speaker 1: I think it's worth considering if you're really bad at

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Speaker 1: budgeting and you need a little shock to the system

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Speaker 1: to try something different to be more effective with your money,

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Speaker 1: to make sure that you're not spending frivolously. But for

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Speaker 1: other people, like if you can handle the digital method

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Speaker 1: of payment and credit cards makes sense, you're able to

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Speaker 1: use credit cards with discipline, that's still the best method

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Speaker 1: we would say of payment. And speaking of credit cards, Matt,

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Speaker 1: We've actually got bad news on the credit card front

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Speaker 1: for Costco members because the City Costco Visa card is

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Speaker 1: going to be losing a key benefit next year, extended

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Speaker 1: warranty protection. This is a huge bummer. First of all,

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Speaker 1: I think for you to even say bad news and

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Speaker 1: Costco in the same sentence, I'm sure folks are like, wait,

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Speaker 1: what did the CEO or something, you know, I think

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Speaker 1: going to raise the price of hot dogs? Did the

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Speaker 1: membership peg also now? But yeah, up until the end

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Speaker 1: of this year, you can still snag two additional years

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Speaker 1: of manufacturers warranty when you buy certain products at Costco

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Speaker 1: with this credit card. But after that this perk is vanishing.

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Speaker 1: It's it's gonna be history. I'm sad mad about this

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Speaker 1: because it's a killer benefit. Uh. It's still probably the

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Speaker 1: best credit card, however, to use when you're doing your

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Speaker 1: shopping at Costco because of the cash back that you get.

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Speaker 1: It's also just one of the best cash back cards

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Speaker 1: for gas purchases that's out there on the market as well.

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Speaker 1: So it's still a card worth having in your wallet,

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Speaker 1: but just a touch less enticing now than it was before.

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Speaker 1: I remember when I bought the computer that we're literally

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Speaker 1: recording this audio on right now from Costco and it

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Speaker 1: had a two year manufacturer's warranty, but using the Costco

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Speaker 1: credit card, I got a four years worth of warranty

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Speaker 1: on that. That's no longer going to be the case

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Speaker 1: starting next year. That's right, man. All right, We've got

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Speaker 1: several other stories we're gonna get to during this episode,

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Speaker 1: like the degree as pleasure portion of our episode, as

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Speaker 1: well as, uh, the kind of returns that you might

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Speaker 1: expect to see on fine Art. We'll get to all

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Speaker 1: those stories and more right after this. All right, now,

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Speaker 1: we're back from the break, and I'm not sure how

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Speaker 1: many Salvador Dolly paintings or Pablo Picasso's our listeners own,

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Speaker 1: but there is an interesting lesson we're gonna get to

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Speaker 1: based on a billionaire who invested in art and how

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Speaker 1: well they performed, and we'll get to that in just

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Speaker 1: a second. But first let's get to our ludicrous headline

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Speaker 1: of the week. This one comes from CNBC and it

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Speaker 1: reads the top ten most regretted college majors and the

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Speaker 1: degrees graduates wish they had pursued instead, and to be honest,

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Speaker 1: there's there's just nothing. There's nothing too insane or offensive

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Speaker 1: about the actual headline this week. Most probably like that

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Speaker 1: seems like a normal headline. But it's really what attracted

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Speaker 1: us to this one and why we stuck it in

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Speaker 1: the slot is because it's it's the underlying problem that

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Speaker 1: this story represents that we have an issue with. One

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Speaker 1: stat in particular stood out, and it was that of

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Speaker 1: all job seekers with college degrees have regrets. And this

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Speaker 1: is where surveys Matt can be so stupid and more accurately,

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Speaker 1: I guess biased because of course, if you're zip recruiter

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Speaker 1: and you're asking a bunch of unemployed folks, because job

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Speaker 1: seekers who who are looking for work, if they wish

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Speaker 1: they'd gotten a major in something else like computer science

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Speaker 1: or engineering, they're probably gonna answer yes, right. I mean,

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Speaker 1: that's you asking someone training in the desert if they're thirsty,

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Speaker 1: and yeah, the very behold an audience. Yes, they're willing

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Speaker 1: to buy whatever it is that you're selling, exactly, And

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Speaker 1: it's not that more thoughts shouldn't be given to what

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Speaker 1: degree it is you want to pursue. We whold heartedly

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Speaker 1: agree that high school seniors need more guidance, and parents

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Speaker 1: should be asking more questions of their kids to get

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Speaker 1: them thinking ahead about career tracks. But it feels like

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Speaker 1: a cheap shot to make it all about income and

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Speaker 1: positioning the data in this way, the results seem obvious

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Speaker 1: and honestly not verty telling. That's true, man. Yeah, and

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Speaker 1: you know, maybe the older and perhaps the wiser we

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Speaker 1: get money, it becomes less of a factor. But a

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Speaker 1: big problem here does actually come down to the money, because,

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Speaker 1: like I bet, a lot of those regrets are because

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Speaker 1: of how much it costs to get those degrees. Right

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Speaker 1: like that, This isn't the first time you've heard us

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Speaker 1: say this here on the show, but the value proposition

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Speaker 1: of college has completely changed. No longer are our graduates

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Speaker 1: in a position where they're virtually guaranteed to make bank

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Speaker 1: after accruing not just their degrees, but significant levels of debt.

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Speaker 1: And so what that means is keeping your student loans

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Speaker 1: manageable in the first place. A typical rule of thumb

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Speaker 1: out there is to limit your your total student loans

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Speaker 1: to your first year's salary. And so what we would

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Speaker 1: recommend then for you to do is for all the

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Speaker 1: recent high school grads and for anybody out there who

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Speaker 1: might be guiding some of these high school grads research

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Speaker 1: the jobs that you would be able to land after

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Speaker 1: achieving that degree. And you can do that at a

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Speaker 1: site like salary dot com, or if you really want

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Speaker 1: to get into the nerdy data of it all, you

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Speaker 1: can head over to the us IS Bureau of Labor Statistics.

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Speaker 1: They have some comprehensive data where you can literally, I

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Speaker 1: mean you can drill. They've got so much data out there, uh,

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Speaker 1: and you can drill down to specific jobs, how many

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Speaker 1: people are employed in those different positions, salary ranges, the

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Speaker 1: just all this awesome information that can help to provide

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Speaker 1: a recent high school grad or or even honestly, somebody

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Speaker 1: who is currently in college, is not too late to

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Speaker 1: make some changes and to switch up your degree and

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Speaker 1: what it is that you're seeking. Yeah, and I like

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Speaker 1: what you said to about keeping your debt level low,

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Speaker 1: Like the stakes are just dramatically lower if we're talking

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Speaker 1: about graduating with fifteen dollars for the student loan debt

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Speaker 1: or fifty, right, And so the less money you owe

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Speaker 1: saddled to your back as you're leaving college, as you're departing,

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Speaker 1: the better off you're going to be. So it's really, really,

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Speaker 1: really crucial to pay important to that aspect, pay more

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Speaker 1: attention to that aspect of it. As tuition costs have

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Speaker 1: gone up and as student lo debt has become more

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Speaker 1: and more of a problem. And interestingly enough, though, Matt,

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Speaker 1: it's it's getting easier to get into college, at least

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Speaker 1: for some folks. The Wall Street Journal featured an article

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Speaker 1: this week about a fairly new phenomena called direct admission

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Speaker 1: and colleges that are attempting this new approach. There they're

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Speaker 1: basically proactively reaching out to students who have the credentials

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Speaker 1: that these colleges are looking for in particularly like a

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Speaker 1: high g p A. But they're looking at other stuff too, uh.

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Speaker 1: And then they're allowing these students to skip a lot

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Speaker 1: of the annoying paperwork that they might otherwise have to

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Speaker 1: submit to be considered for their college, like essays and

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Speaker 1: recommendation letters, which those are not fun, right, and uh,

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Speaker 1: low income in first generation students are being priority eyes

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Speaker 1: in this model, and they're often being offered significant scholarship

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Speaker 1: money via this direct admission model. And so these schools

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Speaker 1: are basically trying to woo the students they want. Uh,

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Speaker 1: there's a couple of websites you need to know about

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Speaker 1: if you're interested in this, common app dot org and

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Speaker 1: niche dot com. There are two sites that are working

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Speaker 1: directly with colleges to streamline this process for high school students.

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Speaker 1: And we're gonna link to their direct admission landing pages

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Speaker 1: in the show notes. But it'll be it'll be worth

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Speaker 1: putting your info in there and seeing what offers come in.

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Speaker 1: The story in the Wall Street Journal is just fascinating

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Speaker 1: to see some of these students who like registered on

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Speaker 1: some of these sites. They included a few key highlights

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Speaker 1: of their academic record, and to see colleges proactively reach

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Speaker 1: out to them make insane offers. Uh, say, you're accepted,

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Speaker 1: plus we want you so bad, We're gonna give you

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Speaker 1: all this money to come here. Certainly like that scholarship

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Speaker 1: angle of it. Yeah, it can be. It can be

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Speaker 1: like shocking in a cool way. Yeah, But I mean

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Speaker 1: that being said though, like I feel like this is

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Speaker 1: more evidence of college not being worth it, right because

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Speaker 1: there's like a there's a shifting power dynamic here and

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Speaker 1: when before you had applicants lining up at the door

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Speaker 1: to get into a school. Well, that's an example of

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Speaker 1: demand not being there essentially, right like when when the

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Speaker 1: supply is turning to the demanded and trying to encourage

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Speaker 1: and incentivize the demand to show up. To me, it

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Speaker 1: almost it feels like it could be an argument that

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Speaker 1: maybe college isn't what it used to be um or

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Speaker 1: at the very least, maybe like that demand has changed

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Speaker 1: a little bit, right, Like I think about it from

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Speaker 1: like our our tendencies to consume, right and so like,

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Speaker 1: and I fall into this trap as well, Like we've

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Speaker 1: talked about these shorts I purchased via an ad that

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Speaker 1: popped up on my Instagram. We are reverting, I think

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Speaker 1: maybe to some of these consumer like tendencies when it

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Speaker 1: comes to, unfortunately, some of these more life altering, life

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Speaker 1: impacting decisions like college. It's one thing if you are

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Speaker 1: more passive when it comes to like buying an article

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Speaker 1: of clothing or something, but when it comes to higher education,

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Speaker 1: multiple years of your life, a lot of money and

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Speaker 1: potentially student loans. Like you said, you know that that

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Speaker 1: students are saddled with I guess I wish that folks

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Speaker 1: were a little more proactive and a little more that

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Speaker 1: there was just a little more due diligence that was

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Speaker 1: being taken place, as opposed to being like, oh, it

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Speaker 1: looks like I can get in here done, I'm gonna

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Speaker 1: do it well, right. I do think that's the part

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Speaker 1: of that that that that just rubs me a little

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Speaker 1: bit the wrong way. I think this is sort of

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Speaker 1: like an active passive strategy though, right, where like literally

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Speaker 1: you're proctically doing something and then you're waiting to see

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Speaker 1: who wants you, and if you get an offer that's

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Speaker 1: it's too good to refuse, you know, then you might say, hey,

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Speaker 1: you know what I was thinking. I was going to

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Speaker 1: go to this college down the street that I practically

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Speaker 1: applied to, but it turns out they didn't offer me

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Speaker 1: nearly a generous of an aid package, and this other

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Speaker 1: college seems to want me enough to basically give me

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Speaker 1: a full ride or get me most of the way there. Um.

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Speaker 1: And And this is just a way that people can

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Speaker 1: at least see if there is a better offer out

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Speaker 1: there so they can limit and curb their student loan usage,

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Speaker 1: because that's obviously a massive problem and that is what's

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Speaker 1: going to derail people's finances for years and decades to come.

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Speaker 1: Totally and I do like the fact that it saves

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Speaker 1: a lot of time and energy on behalf of a

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Speaker 1: student if they don't have to apply to all of

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Speaker 1: these different colleges. If if they can at one side

431
00:21:08,960 --> 00:21:11,000
Speaker 1: entering their information and have that be sent to a

432
00:21:11,000 --> 00:21:13,520
Speaker 1: bunch of different schools, it makes it having to Um. Yeah,

433
00:21:13,520 --> 00:21:16,040
Speaker 1: it's the ability to streamline the process. I think it's great. Yeah,

434
00:21:16,040 --> 00:21:18,240
Speaker 1: it's a little like the efficiency, a little less opaque

435
00:21:18,240 --> 00:21:20,760
Speaker 1: on the on the individual, and it just creates more

436
00:21:20,760 --> 00:21:23,360
Speaker 1: incentive for these colleges to bid against one another too,

437
00:21:23,720 --> 00:21:26,560
Speaker 1: to the benefit of that student. Totally. Yeah, actually, you know,

438
00:21:26,560 --> 00:21:28,800
Speaker 1: I mean we we talked about five twenty nine plans

439
00:21:28,840 --> 00:21:31,280
Speaker 1: back on Wednesday, how they're not you know, they're not

440
00:21:31,320 --> 00:21:36,000
Speaker 1: really our favorites savings or investing tools saving massive chunks

441
00:21:36,000 --> 00:21:39,080
Speaker 1: of money for college. Again, when the value proposition of

442
00:21:39,160 --> 00:21:42,359
Speaker 1: higher education is declining, that doesn't make a ton of sense,

443
00:21:42,880 --> 00:21:47,320
Speaker 1: especially if it means de prioritizing other more important ways

444
00:21:47,400 --> 00:21:50,200
Speaker 1: of saving and investing your money. But five twenty nine

445
00:21:50,240 --> 00:21:52,560
Speaker 1: plans they still make sense for some folks out there

446
00:21:52,560 --> 00:21:55,600
Speaker 1: who are doing all of the right things on those

447
00:21:55,600 --> 00:21:58,520
Speaker 1: other fronts. And morning Star they just issued new five

448
00:21:58,960 --> 00:22:02,480
Speaker 1: nine plan raidings that are worth taking. Taking a look

449
00:22:02,520 --> 00:22:06,359
Speaker 1: at Michigan and Utah, they actually take the top spots

450
00:22:06,359 --> 00:22:10,000
Speaker 1: this year thanks to massively low fees uh morning Star.

451
00:22:10,080 --> 00:22:12,600
Speaker 1: They also list out to have other plans that get

452
00:22:12,640 --> 00:22:15,240
Speaker 1: a silver medal according to their metrics. And so what's

453
00:22:15,280 --> 00:22:16,720
Speaker 1: really important to keep in mind here is that you

454
00:22:16,760 --> 00:22:19,720
Speaker 1: don't have to choose the plan wherein you reside the

455
00:22:19,720 --> 00:22:22,520
Speaker 1: plan that your state offers. You can pick one of

456
00:22:22,560 --> 00:22:24,879
Speaker 1: these other one of these better plans. We think that

457
00:22:24,880 --> 00:22:28,560
Speaker 1: that would be smart unless your state offers a tax incentive.

458
00:22:29,040 --> 00:22:32,160
Speaker 1: Uh So, just yeah, remember plans, they're not a slam dunk.

459
00:22:32,520 --> 00:22:35,320
Speaker 1: The stats show that something like a third of parents

460
00:22:35,359 --> 00:22:38,760
Speaker 1: out there they end up using five nine plan money

461
00:22:38,840 --> 00:22:43,359
Speaker 1: for other purposes, resulting in taxes and penalties. And so

462
00:22:43,480 --> 00:22:45,119
Speaker 1: we mentioned that because we want you to think twice

463
00:22:45,280 --> 00:22:47,520
Speaker 1: before you start talking away money in one of these

464
00:22:47,520 --> 00:22:50,960
Speaker 1: accounts for your kids. Please make sure that you have

465
00:22:51,200 --> 00:22:53,840
Speaker 1: all of the other boxes checked first, in particular when

466
00:22:53,880 --> 00:22:57,240
Speaker 1: it comes to your own retirement savings. And for folks

467
00:22:57,280 --> 00:22:59,679
Speaker 1: who are further along in the money gears, they've been

468
00:22:59,680 --> 00:23:02,600
Speaker 1: crushed it and they're like they're they're continuing to socc

469
00:23:02,640 --> 00:23:04,480
Speaker 1: away money for their own futures in a big way,

470
00:23:04,760 --> 00:23:06,240
Speaker 1: and they're like, I've got extra money, what should I

471
00:23:06,240 --> 00:23:08,320
Speaker 1: do with it? Five? Nine? Playing might make sense for you,

472
00:23:08,359 --> 00:23:09,760
Speaker 1: And you'll want to take a look at this Morning

473
00:23:09,760 --> 00:23:12,919
Speaker 1: Star list to find the states that prioritize low fees

474
00:23:13,040 --> 00:23:16,000
Speaker 1: for investors. And you want to check and see if

475
00:23:16,040 --> 00:23:19,320
Speaker 1: your state offers a tax incentive to socc away money

476
00:23:19,359 --> 00:23:21,399
Speaker 1: in those accounts, because that can be kind of an

477
00:23:21,440 --> 00:23:24,320
Speaker 1: additional benefit. But you're right, map for most people, it

478
00:23:24,359 --> 00:23:26,640
Speaker 1: should be kind of a back burner type thing. Uh.

479
00:23:26,760 --> 00:23:28,640
Speaker 1: And let's talk about art here for a second, Matt.

480
00:23:29,560 --> 00:23:31,960
Speaker 1: You might have seen the headlines last week about Microsoft

481
00:23:32,040 --> 00:23:35,200
Speaker 1: co founder Paul Allen selling pieces of his art collection

482
00:23:35,560 --> 00:23:38,280
Speaker 1: for for a lot of money, the lesser known Microsoft.

483
00:23:38,640 --> 00:23:41,240
Speaker 1: That's right, people like who, well, he uh owns the

484
00:23:41,280 --> 00:23:43,280
Speaker 1: Seattle Seahawks. I believe he's a massed a lot of

485
00:23:43,280 --> 00:23:46,679
Speaker 1: great wealth too, even though Bill Bill Gates is the

486
00:23:46,680 --> 00:23:49,960
Speaker 1: headline Microsoft guy hogs all the spotlight, right, which I'm

487
00:23:49,960 --> 00:23:52,720
Speaker 1: sure Paul he's probably okay with that. Yeah, yeah, I

488
00:23:52,720 --> 00:23:55,119
Speaker 1: don't think he minds. But it turns out he sold

489
00:23:55,200 --> 00:23:57,440
Speaker 1: a Sasan and a mona along with like a bunch

490
00:23:57,440 --> 00:24:00,359
Speaker 1: of other pieces of art recently. And I don't think

491
00:24:00,359 --> 00:24:02,040
Speaker 1: he had had any Bob Rosses though, I mean, I

492
00:24:02,040 --> 00:24:04,199
Speaker 1: think that would have probably made this collection no no

493
00:24:04,280 --> 00:24:07,440
Speaker 1: happy trees, happy no happy trees. But the headline numbers

494
00:24:07,440 --> 00:24:09,640
Speaker 1: from what he sold are just staggering. His art collection,

495
00:24:09,960 --> 00:24:11,960
Speaker 1: or at least a portion of it, fetched more than

496
00:24:12,000 --> 00:24:14,440
Speaker 1: one point six billion dollars. And that's a lot of

497
00:24:14,480 --> 00:24:19,600
Speaker 1: money art, right, Yes, exactly that, But interestingly enough, that

498
00:24:19,800 --> 00:24:24,000
Speaker 1: sounds better than the reality. The average to annualized growth

499
00:24:24,400 --> 00:24:27,880
Speaker 1: of Paul's art collection was six point two percent over

500
00:24:27,920 --> 00:24:30,680
Speaker 1: the average eighteen years he owned those pieces. What what

501
00:24:31,040 --> 00:24:33,159
Speaker 1: was the average rad return of the SMP five hundred

502
00:24:33,160 --> 00:24:36,400
Speaker 1: over that length the time eight point nine So we're

503
00:24:36,400 --> 00:24:38,560
Speaker 1: not against buying art for fun. It's actually one of

504
00:24:38,600 --> 00:24:40,959
Speaker 1: my craft beer equivalents is buying a piece of art

505
00:24:40,960 --> 00:24:44,120
Speaker 1: at least one every year. Uh. And we love it.

506
00:24:44,119 --> 00:24:46,560
Speaker 1: It's it's well worth it for us. But we don't

507
00:24:46,600 --> 00:24:49,000
Speaker 1: look at as an investment, and we don't love the

508
00:24:49,080 --> 00:24:52,520
Speaker 1: idea of purchasing art as an investment. If that's your goal,

509
00:24:52,960 --> 00:24:55,080
Speaker 1: that's a hard thing to get right. And as you

510
00:24:55,080 --> 00:24:58,200
Speaker 1: can see, even the multi billionaires, even the elite wealthy

511
00:24:58,240 --> 00:25:02,440
Speaker 1: amongst us don't necessarily do well with those purchases, right, Yeah,

512
00:25:02,520 --> 00:25:05,640
Speaker 1: it obviously it sounds like something that only the wealthy,

513
00:25:05,720 --> 00:25:09,479
Speaker 1: elite football team owning folks can partake in. But with

514
00:25:09,480 --> 00:25:12,560
Speaker 1: the advent of master works and other sites that that

515
00:25:12,680 --> 00:25:16,000
Speaker 1: lets you buy fractional shares of individual pieces of art,

516
00:25:16,400 --> 00:25:18,639
Speaker 1: it is becoming more mainstream. We've talked about it here

517
00:25:18,680 --> 00:25:21,000
Speaker 1: on the show, and I'll admit it sounds kind of cool.

518
00:25:21,480 --> 00:25:24,399
Speaker 1: It sounds like it might be a smart diversification play, right,

519
00:25:24,480 --> 00:25:26,359
Speaker 1: just like it's it sounds nice at cocktail parties, just

520
00:25:26,400 --> 00:25:29,360
Speaker 1: to people like I own part of a right. Yeah,

521
00:25:29,400 --> 00:25:36,200
Speaker 1: it makes you sound dope when sophisticated one best exactly.

522
00:25:36,720 --> 00:25:40,040
Speaker 1: But again, like we've discussed before, the fees are substantial.

523
00:25:40,320 --> 00:25:43,520
Speaker 1: You're paying something like twenty anytime, and artwork that you

524
00:25:43,560 --> 00:25:46,639
Speaker 1: are invested in cells um and returns aren't nearly as

525
00:25:46,720 --> 00:25:49,360
Speaker 1: good as you might have been led to believe. Who

526
00:25:49,359 --> 00:25:52,320
Speaker 1: knows what the future holds for art, but we would

527
00:25:52,320 --> 00:25:54,960
Speaker 1: recommend that you buy real physical art because you enjoy it,

528
00:25:55,080 --> 00:25:57,000
Speaker 1: and not because you think that it's going to make

529
00:25:57,040 --> 00:25:59,840
Speaker 1: you money someday. We would rather see you invested in

530
00:26:00,320 --> 00:26:03,320
Speaker 1: the stock market as a whole. And on that note,

531
00:26:03,400 --> 00:26:06,720
Speaker 1: if you want to learn more about index funds, well,

532
00:26:06,880 --> 00:26:10,480
Speaker 1: we're actually gonna have a fascinating chat with Robin Wigglesworth.

533
00:26:10,600 --> 00:26:13,159
Speaker 1: We'll have that interview for you here on Monday, but

534
00:26:13,160 --> 00:26:15,639
Speaker 1: we're gonna dive into the history, yeah, of index funds.

535
00:26:15,680 --> 00:26:20,040
Speaker 1: It's a really interesting, fascinating story of something that it

536
00:26:20,080 --> 00:26:22,239
Speaker 1: feels like slice bread, like it's something that's always been

537
00:26:22,240 --> 00:26:25,800
Speaker 1: around and something that we just take for granted essentially,

538
00:26:25,840 --> 00:26:28,480
Speaker 1: inpecially for people forty and under and yeah, you've known

539
00:26:28,480 --> 00:26:30,560
Speaker 1: nothing else. Basically for everybody out there who is our

540
00:26:30,600 --> 00:26:33,000
Speaker 1: age and younger. Essentially, it's like, oh, yeah, the world

541
00:26:33,040 --> 00:26:35,920
Speaker 1: has always existed with the NIX funds. Right, No, that's

542
00:26:35,920 --> 00:26:38,320
Speaker 1: not the case. And we're gonna talk all about that

543
00:26:38,400 --> 00:26:41,080
Speaker 1: here on Monday, how they came to be and how

544
00:26:41,119 --> 00:26:43,080
Speaker 1: they've changed the world really so right, it's gonna be

545
00:26:43,080 --> 00:26:45,200
Speaker 1: a fun combo, but that's gonna do it for today's

546
00:26:45,240 --> 00:26:48,000
Speaker 1: Friday flight folks. You can find show notes up on

547
00:26:48,000 --> 00:26:50,239
Speaker 1: our website at how to money dot com. You can

548
00:26:50,240 --> 00:26:53,720
Speaker 1: also find our credit card tool. It's brand new and

549
00:26:53,840 --> 00:26:55,879
Speaker 1: it's super helpful if you're looking for the right credit

550
00:26:55,880 --> 00:26:58,000
Speaker 1: card for how you spend it, just go to how

551
00:26:58,000 --> 00:27:00,400
Speaker 1: to money dot com slash credit cards. You'll get there.

552
00:27:00,760 --> 00:27:02,320
Speaker 1: It's easy to play around and kind of find that

553
00:27:02,400 --> 00:27:04,160
Speaker 1: credit card than zero in on the one that has

554
00:27:04,400 --> 00:27:07,360
Speaker 1: the best benefits for for you the best rewards. That's right,

555
00:27:07,400 --> 00:27:08,960
Speaker 1: but don't mess around with it. If you have a

556
00:27:08,960 --> 00:27:11,760
Speaker 1: problem with spending too much money the cash stuffing method

557
00:27:11,840 --> 00:27:15,160
Speaker 1: instead exactly vigil that's going to be for this episode

558
00:27:15,240 --> 00:27:18,280
Speaker 1: until next time. Best Friends Out, Best Friends Out,