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

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Speaker 1: and today we're talking TikTok shop, bitcoinners, beware, and kitchen

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Speaker 1: appreciation fees.

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Speaker 2: Yeah, buddy, this is our Friday flight, and we're gonna

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Speaker 2: talk about the relevant stories that we think you need

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Speaker 2: to be aware of. We're gonna talk about the stories

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Speaker 2: you mentioned, Ol, We're gonna talk about investing. I feel

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Speaker 2: like at least once per episode we got to touch

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Speaker 2: on investing a little bit, the proper thing to that

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Speaker 2: you should be doing with your money.

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Speaker 1: It's a core necessity that we talk about often.

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Speaker 2: Absolutely. But before we get to that, so Amy over

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Speaker 2: in our Facebook group, she mentioned that there's this perk

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Speaker 2: that if you are a stockholder of a MC stock,

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Speaker 2: so the movie theater chain, you get certain perks occasionally

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Speaker 2: by being a stockholder. This is the way that they're

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Speaker 2: reaching out to stockholders to kind of like connect them

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Speaker 2: with the actual act of going to the movie theater.

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Speaker 1: Well, this really goes back to kind of when AMC

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Speaker 1: became a meme stock and it was a way to

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Speaker 1: reward those people who are helping prop up the company.

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Speaker 2: That's right, and so occasionally they will offer you like

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Speaker 2: free popcorn. I was sad to see that. It'd be

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Speaker 2: one thing if like every time you went in you

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Speaker 2: could just get free popcorn, But it's like, oh, you

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Speaker 2: get a free refill, so you have to actually buy

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Speaker 2: some popcorn first. And there's some other kind of random

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Speaker 2: perks that they that they roll out. But my question

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Speaker 2: for you is, basically, is this a frugal or cheat?

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Speaker 2: Is it a frugal move in your opinion to get

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Speaker 2: you some of that AMC stock in order to receive

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Speaker 2: some of these perks that you're getting there in the

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Speaker 2: movie theater.

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Speaker 1: So I'm not going to do it. But it's not

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Speaker 1: because even my stance against single stock ownership, it is.

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Speaker 1: It is more because I don't ever go to the movies.

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Speaker 1: But I think if you're the kind of person who

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Speaker 1: goes same to the movies and AMC is like your

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Speaker 1: closest theater or whatever, and you're not going just to

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Speaker 1: kind of score the pre popcorn paying thirty bucks to

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Speaker 1: get in the door to watch a movie. But if

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Speaker 1: you're like I go any this is just a way

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Speaker 1: to get some you know, free concessions. When I do

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Speaker 1: go see a movie, I think it's I think it's great,

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Speaker 1: and why not buy a single share sort.

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Speaker 2: Of thing and say that's that's exactly how I feel it.

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Speaker 2: Like I would much rather though, be at home watching

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Speaker 2: a movie on my own TV, sitting on my own couch,

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Speaker 2: next to my own wife, not somebody else's wife, out

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Speaker 2: in public, eating the popcorn that she's made, drinking delicious

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Speaker 2: coc and rum that I've made. Like that's the kind

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Speaker 2: of experience that I want versus you know, actually going

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Speaker 2: into it. Yeah, I think it could make sense if

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Speaker 2: this is something that you like to like to do often,

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Speaker 2: something that you can take advantage of. But I wouldn't

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Speaker 2: necessarily go out of my way to go ahead and buy,

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Speaker 2: you know, a single stock of AMC in order to

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Speaker 2: di scorre.

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Speaker 1: This benefits kind of on the note of food and

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Speaker 1: Frooguler cheap. I was talking to a friend, you know,

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Speaker 1: we go there our local water park or whatever here

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Speaker 1: in outside of Atlanta. You and I we got like

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Speaker 1: sick deals on season passes for the family. We've been

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Speaker 1: going to do that. And I was talking to a

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Speaker 1: friend there the other day and he was saying, next year,

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Speaker 1: you got to get the meal passed. And some people

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Speaker 1: come into the water park to get their free meal

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Speaker 1: and then they go home and eat that meal because this,

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Speaker 1: apparently the food pass is so cheap. I think we

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Speaker 1: talked about this at one point with some dude using

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Speaker 1: his six Flags pass and the meal pass attached to it.

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Speaker 1: It's like a couple dollars a meal when you factor

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Speaker 1: it out. If you're going every day to get to

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Speaker 1: get your free food.

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Speaker 2: Have you heard about this? Ah, I think I've seen it.

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Speaker 2: But like the food that you get at concession stands,

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Speaker 2: it's one thing if you're gonna help it, like grab

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Speaker 2: a lemonade or something like that. But I'm not necessarily

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Speaker 2: going to go all the way out to a theme

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Speaker 2: park just to grab, yeah, a bunch of hotter.

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Speaker 1: This was close to our house, it's like six or

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Speaker 1: seven minutes away, and so it's almost like going to

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Speaker 1: instead of going to Wendy's or McDonald's. If you're a

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Speaker 1: fast food person, it's like you go there instead. But

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Speaker 1: you're right, I mean, if you're eating that every day,

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Speaker 1: it's it's not going to be good for other reasons.

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Speaker 1: Oh yeah, I'll let you try that one out. Maybe

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Speaker 1: this and this next year. You let me know, not me,

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Speaker 1: all right? All right, let's get on to the Friday flight, Matt.

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Speaker 1: It's a sampling of stories, of course, that we found

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Speaker 1: interesting this week that pertain to your personal finances. Let's

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Speaker 1: start off by talking We'll keep talking about food, talking

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Speaker 1: about restaurant fees. There was an article Matt in the

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Speaker 1: La Times just a couple of weeks ago about the

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Speaker 1: annoying and sometimes downright deceptive restaurants surcharges that are still

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Speaker 1: plugging customer bills after they finished their meals. This is

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Speaker 1: one of those things, like, I don't know, tipping done wild.

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Speaker 1: It feels like is what's happened in our country, right,

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Speaker 1: especially in major metropolitan cities. And a lot of this

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Speaker 1: had to do with COVID, and a lot of us

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Speaker 1: were more than happy to support our favorite restaurants. We

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Speaker 1: realized that they had to tack on these fees for

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Speaker 1: a time, but those fees persist, right, and so there's

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Speaker 1: a certain amount of not responsibility. But we wanted to

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Speaker 1: prop up our favorite local restaurants. We talked about this

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Speaker 1: back tour on our prisdetic, like we went out to.

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Speaker 2: The favorite spots in bav Yeah, just to like, man,

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Speaker 2: the amount of takeout that we ordered just to make

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Speaker 2: sure that we were contributing to our community, just that

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Speaker 2: that entire mindset.

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Speaker 1: We were buying gift cards that we didn't know we

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Speaker 1: would actually end up getting to use because we cared

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Speaker 1: about our restaurants.

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Speaker 2: It was more like a donation as opposed to a

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Speaker 2: smart way of spending your money.

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Speaker 1: But now now things are back to normal. Customers are

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Speaker 1: fighting back there saying enough is enough, especially when I

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Speaker 1: get blindsided, you know, when I get the bill, and

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Speaker 1: so Reddit users in LA and Chicago they've created these

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Speaker 1: public Google sheets to reveal, to basically highlight the restaurants

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Speaker 1: that are imposing these fees on their customers, and it's boker.

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Speaker 1: Some of the names are hilarious, like the Health and

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Speaker 1: Happiness Fee or the Kitchen Love surcharge. And people's bills

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Speaker 1: are magically growing up, going up by like five to

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Speaker 1: eighteen percent. This was a lot that you're not expecting

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Speaker 1: when you get the final bill, and it's it's not

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Speaker 1: great for servers either, because a lot of people think, oh,

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Speaker 1: this probably goes this is probably in lieu of a tip,

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Speaker 1: but at a lot of these places it's it's not.

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Speaker 1: And so I guess what we would tell restaurant owners

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Speaker 1: is just raise the menu prices so that we can

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Speaker 1: see front and center when we're looking at what we

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Speaker 1: want to order, what the cost is is the it's

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Speaker 1: or at least let people know, but what they Yeah,

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Speaker 1: it's a transparency, Like I don't like just fees anyway,

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Speaker 1: build it into the price. Let's get rid of the fees.

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Speaker 1: And we gave you a lot of leeway during COVID,

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Speaker 1: but it's time for restaurants to kind of change their

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Speaker 1: tactic on some of these goofy fees are charging.

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Speaker 2: Yeah. Well, and then the problem is is oftentimes like

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Speaker 2: you think that that charge is going to servers, but

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Speaker 2: in a lot of cases it's not. It's straight to

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Speaker 2: the pockets, to the arm. So it foolds you into

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Speaker 2: thinking that you don't need to leave a tip. And

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Speaker 2: so that's why specifically in the La Times example, they

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Speaker 2: were talking about how servers are like suing this restaurant

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Speaker 2: group or whatever. But it's also just a like, in

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Speaker 2: my mind, attack it. Like it's just not a good

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Speaker 2: customer experience because when you sit down and you see

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Speaker 2: all these line items, like I don't want to have

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Speaker 2: to have an accounting degree to be able to review

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Speaker 2: my receipt as opposed, like you're just telling me how

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Speaker 2: much everything costs. No, that just tell me how much

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Speaker 2: the I just want to bottom line number, because it's

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Speaker 2: not like by breaking those things out that you can

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Speaker 2: remove those things. There is no power or control that

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Speaker 2: you have. And so from that standpoint, I'm not a

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Speaker 2: huge fan of it either.

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Speaker 1: Well, the one thing I would tell people when you

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Speaker 1: get the receipt, if you weren't told in advance about

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Speaker 1: this charge, talk to a manager certainly about it. Yeah,

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Speaker 1: what is this fee? What does it go to?

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Speaker 2: Why am I paying it?

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Speaker 1: And then if if they refuse to like eliminate it,

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Speaker 1: or they don't have a good explanation, or or they

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Speaker 1: didn't tell you ahead of time. I mean that might

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Speaker 1: be a restaurant, probably not go back, you may not

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Speaker 1: frequent again. Yeah, so that's the kitchen appreciation fees. But

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Speaker 1: credit card fees are becoming more common these days too,

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Speaker 1: in particular at restaurants. But like it used to be,

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Speaker 1: you would see this mostly at gas stations, small boutique

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Speaker 1: retailers you see like liquor stores at least around here.

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Speaker 1: But as paying with a credit card becomes essentially ubiquitous

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Speaker 1: restaurants are doing their best to claw back some of

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Speaker 1: the essentially they're called like swhite fees that they pay

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Speaker 1: to Visa and MasterCard. It's one of their largest expenses.

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Speaker 1: And so I kind of get it right, like, I

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Speaker 1: actually don't mind if they're trying to pass some of

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Speaker 1: those expenses along to the customers. There's not a whole

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Speaker 1: lot of margin when it comes to running a successful restaurant.

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Speaker 1: It's not a sneaky, contrived attempt just to get more

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Speaker 1: money out of you. But with this one, I think

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Speaker 1: folks they definitely do have the ability to modify how

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Speaker 1: it is that they're going to pay in order to

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Speaker 1: avoid this additional fee, because you know, depending on how

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Speaker 1: much the actual fee is, I am still likely going

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Speaker 1: to pay with my credit card because I'm optimized. Yeah

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Speaker 1: there are if it was a Temperton fee, but if

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Speaker 1: it's a no, yeah, two or three percent fee, you'll

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Speaker 1: still play with past plastic exactly.

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Speaker 2: And I think this is something too that I think

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Speaker 2: you can push back on because if you saw that

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Speaker 2: fee after you get wrung up, I think you could say, oh, actually,

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Speaker 2: do you mind re ringing that? Because I didn't know

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Speaker 2: you're going to charge me specifically for using a credit card,

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Speaker 2: and I don't think they would mind if you're like, oh, sure,

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Speaker 2: actually I want to switch over to cash because I

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Speaker 2: see there's a little discount built in by doing that.

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Speaker 2: I think as long as customers and consumers, as long

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Speaker 2: as they have the option to do something about it,

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Speaker 2: that's I don't mind it. If you are giving folks

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Speaker 2: the option. Well, and again, this is a hard cost

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Speaker 2: the restaurants have.

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Speaker 1: The kitchen appreciation fee is just kind of a bogus

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Speaker 1: thing and it's like, oh, just make your prices what

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Speaker 1: they should be. But they have a legitimate hard cost

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Speaker 1: when it comes to taking credit cards. And if they

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Speaker 1: want to incentivize people to get a discount to pay

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Speaker 1: with cash, I mean I'm okay with that.

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Speaker 2: That's something that you can do something about, right as

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Speaker 2: opposed to it just being this line item that's just

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Speaker 2: listed doubt and it's just like oh great, okay, can't

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Speaker 2: do anything about that. Maybe I just want to, like

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Speaker 2: you said, choose not to come back here again.

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Speaker 1: Well, and like, I think the reason you said that

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Speaker 1: you would potentially still pay with a credit card is

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Speaker 1: because of the rewards that you get in some of

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Speaker 1: our favorite cards, you get three or four percent cash

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Speaker 1: back when you're eating out. And so if the if

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Speaker 1: the credit card fees three percent, well guess what my

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Speaker 1: costco Visa card comes with a three percent three percent

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Speaker 1: cash back when eating out. You've got one that gives

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Speaker 1: you four percent cash back when you're eating out. And

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Speaker 1: so that's a good reason to say, oh yeah, I'll

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Speaker 1: still pay with credit card. It's it's a wash, But

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Speaker 1: let's keep talking about credit card fees. Mat there's I

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Speaker 1: feel like we've all gotten used to credit card reward

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Speaker 1: points over the years. We just did a whole episode

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Speaker 1: with Lynn Metler about how to fly for free with

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Speaker 1: your family and using credit card rewards. Yeah, TLDR, the

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Speaker 1: only way you can get there is through credit cards.

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Speaker 1: There's no other, no other way that I know of

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Speaker 1: that's going to allow you to travel for free around

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Speaker 1: the world or around the country. This is all thanks

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Speaker 1: to the credit card companies. But it's not just because

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Speaker 1: they're benevolent other credit card users who don't pay off

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Speaker 1: their balances in full every month. They're kind of subsidizing

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Speaker 1: our rewards. But on top of that, because the credit

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Speaker 1: card companies make massive swipe fees like we just talked

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Speaker 1: about that are burdening these restaurants every single time we

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Speaker 1: use our cards. These fees are actually kind of on

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Speaker 1: the chopping block. They might not be around for much longer.

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Speaker 1: And if Congress decides to pass the Credit Card Competition

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Speaker 1: Act as it's called, this could substantially inhibit the s

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Speaker 1: white fees that Visa and MasterCard are able to charge,

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Speaker 1: which would in all likelihood inhibit the rewards that we're

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Speaker 1: able to earn. Is this even going to pass, Is

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Speaker 1: it going to get a vote even? I don't know,

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Speaker 1: but this two percent transaction costs is a huge part

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Speaker 1: of the reason we all have rewards these days. And

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Speaker 1: if something does get done, if this practice gets cracked

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Speaker 1: down upon, then those rewards they might not be around

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Speaker 1: much longer.

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Speaker 2: That's true. Yeah, And typically I'll say I'm skeptical anytime

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Speaker 2: the government wants to step in and play artificial limits

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Speaker 2: on anything, right, but I will say I am slightly

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Speaker 2: more hopeful about this bill because they're looking to increase competition,

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Speaker 2: and so the different the way the networks work is,

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Speaker 2: they're thinking about making it so that one of the

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Speaker 2: two networks that they are using is not either Visa

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Speaker 2: or MasterCard, which dominate, like I think, over eighty percent

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Speaker 2: of the market.

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Speaker 1: They basically have a duopoly, which is two companies that

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Speaker 1: run there. And so I like this from the standpoint

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Speaker 1: of it introduces competition, and anytime there's competition, you're not

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Speaker 1: just stifling an industry. It opens the door for.

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Speaker 2: Some creative expansion, which is something that I do like

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Speaker 2: to see. It makes me think of there's a study

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Speaker 2: like a long time ago, I think over at MIT,

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Speaker 2: but they studied the airlines and any time a low

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Speaker 2: cost budget airline moved into a new market, a new city,

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Speaker 2: what did that do to all the other airline fares?

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Speaker 2: It lowered them. I think they caught it like the

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Speaker 2: Southwest effect. But basically, by introducing more competition and giving

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Speaker 2: people more options, it drove prices down, which ultimately saves

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Speaker 2: us all money.

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Speaker 1: Same thing happens when it all d launches in a neighborhood, right,

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Speaker 1: I mean it's Kroger prices at Kroger that's half a

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Speaker 1: mile away. The prices go down there too because now

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Speaker 1: they've got a competition.

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Speaker 2: Yeah, yeah, I love it. And we haven't even talked

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Speaker 2: about the fact that when Dixie and Ald the fact

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Speaker 2: that all the bought when Dixie. Yeah, that's promising. And

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Speaker 2: so if you've got a win Dixie near you, fingers crossed,

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Speaker 2: that is one because they're only choosing to convert certain

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Speaker 2: numbers of the wind Dixies to about four hundred stores,

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Speaker 2: but to these they're only converting some, right, So yeah,

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Speaker 2: fingers crossed that your wind Dixie will turn into an

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Speaker 2: Ald but hopefully it doesn't impact the existing Aldis and

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Speaker 2: the incredible prices that they're able to offer folks. Yeah,

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Speaker 2: so again this is this is vapor where this is

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Speaker 2: potential legislation, but and it could have an impact on

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Speaker 2: credit card fees. And you know what, Matt, I'm.

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Speaker 1: Okay if the if those white fees go down, and

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Speaker 1: if it reduces costs for retailer.

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Speaker 2: I'm all about of those fees go. Yeah, it's about

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Speaker 2: how they sure are able to limit this.

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Speaker 1: But I'm all good with that because I don't mind

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Speaker 1: missing out on some of those rewards if it lowers prices, right,

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Speaker 1: And I kind of like the system the way it is,

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Speaker 1: but I know it's also not the most fair system.

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Speaker 1: So if those fees go down, no sweat off my back.

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Speaker 1: I'm okay with with fewer fewer rewards. But since we're

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Speaker 1: talking about cards and plastic, let's talk about gift cards

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Speaker 1: for a second. There's a lot of unused gift cards.

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Speaker 1: This is something that continues to be an American problem,

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Speaker 1: and forty seven percent of US adults have gift cards

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Speaker 1: languishing in their wallet, their purse, or like their underwear jar.

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Speaker 2: That's that's where a lot of people keep there, right,

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Speaker 2: So we keep your cash on it's right, yeah, because

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Speaker 2: I look through your underword, which is weird.

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Speaker 1: But like the real thing, Matt is, people need to

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Speaker 1: spend the gift cards that they have, right, pull them together.

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Speaker 1: Emily and I did this. We started going back to

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Speaker 1: these places where we had gift cards and taking our

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Speaker 1: date nights based on where we had a gift card too.

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Speaker 1: So use I use the gift cards you have on hand,

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Speaker 1: or if you're like, hey, this isn't really my jam,

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Speaker 1: buy something for somebody else at that retailer, or sell

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Speaker 1: your unused gift card that you're never gonna use, you're

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Speaker 1: never gonna get get around to using. It's just basically

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Speaker 1: like worthless in your life, will turn it into something

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Speaker 1: positive and yeah, you can sell it at a site like

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Speaker 1: card cash dot com.

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Speaker 2: Can you so, can you sell a gave credit there?

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Speaker 2: Do you and Emily get one of my favorite intown restaurants? Well,

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Speaker 2: and then we also have a gave credit or different.

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Speaker 2: I think we're all out now. Yahay. We used it

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Speaker 2: all right before we moved up, because that's a hall

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Speaker 2: to go all the way back in town like that.

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Speaker 2: That's kind of a friugler cheap as well. It's just like, oh,

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Speaker 2: it's so far away. Is it worth the additional time

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Speaker 2: the gas to take advantage of money that you've already spent,

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Speaker 2: because then you start dealing with a little bit of

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Speaker 2: the some cost fallacy, right, You're like, we already have it.

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Speaker 1: It is if you love the place, right and you

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Speaker 1: want to go back there because it's one of your favorites.

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Speaker 1: And the whole reason I bought gift cards to that

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Speaker 1: restaurant so frequently is because they offer deals. There were

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Speaker 1: always great deals. It was like, hey, if you spend

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Speaker 1: one hundred bucks, you'll get one hundred and forty dollars

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Speaker 1: in gift cards to our restaurant. And that's when gift

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Speaker 1: cards make sense, right, win value there when you're getting

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Speaker 1: a special deal. But for the most part, I think

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Speaker 1: gift cards when you're just trading a dollar that can

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Speaker 1: be spent anywhere for a dollar that has to be

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Speaker 1: spent in one specific place that doesn't really compete with me,

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Speaker 1: it doesn't really make much sense. So I would say, like,

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Speaker 1: if you're thinking about getting a gift card for somebody

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Speaker 1: as a gift and you're not getting any sort of

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Speaker 1: additional perk, give cash instead with a thoughtful letter that

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Speaker 1: says like, Hey, I know you're you've been wanting this,

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Speaker 1: or I know you would love this, or I know

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Speaker 1: you you'd love to go spend this on an experience

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Speaker 1: or something like that. I mean, think about wedding registries now, Matt,

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Speaker 1: people want cash more than anything to like a home

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Speaker 1: down payment. Yeah, they want down payments or honeymoon dollars,

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Speaker 1: right and so, but people want to give you plates

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Speaker 1: and forks and stuff like that, and sometimes like the

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Speaker 1: best gift is cash.

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Speaker 2: Yeah, you're more of an absolutist on this one, which

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Speaker 2: is normally the roles have reversed a little bit. I

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Speaker 2: feel like I normally like the absolutists, but I do

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Speaker 2: think it makes sense if you want to give somebody,

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Speaker 2: like you said, an experience, because that otherwise they would

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Speaker 2: not pay for themselves, right, and so like it makes

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Speaker 2: like a favorite coffee shop here Tuesday, they make the

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Speaker 2: best call, Like they pull the best espresso, they make

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Speaker 2: the best coffee. The actual shop is gorgeous, it's awesome.

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Speaker 2: And I think there's a lot of folks who would say, well,

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Speaker 2: I don't really want to go there. But if I

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Speaker 2: basically am curating an experience, and I'm saying I really

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Speaker 2: want you to experience what I get to experience when

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Speaker 2: I go there, that's when I think it makes sense

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Speaker 2: because otherwise you could write a note, but you can

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Speaker 2: take them there or even better, absolutely even better. But

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Speaker 2: I think that's one exception as well. So certainly if

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Speaker 2: you get a deal, if you're able to get more

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Speaker 2: by getting ordering buying a gift card than the actual

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Speaker 2: cost of the gift card. But then there's a whole

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Speaker 2: experience side of it as well that I think can

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Speaker 2: make a lot of sense. Lots of time.

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Speaker 1: It can be it can be kind of a lazy gift, right,

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Speaker 1: And you're calling me lazy. No, we're not trying to

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Speaker 1: throw shade. I'm just saying I know from personal experience

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Speaker 1: that sometimes that's like a oh, I kind of know

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Speaker 1: they like that retailer, maybe I'll just grab something there

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Speaker 1: and oh yeah, yeah and so And I mean, I'm guilty, guilty,

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Speaker 1: because I've done it too, But I do think that

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Speaker 1: that cash is is often a better gift, And especially

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Speaker 1: when you look at that stat and you're like, man,

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Speaker 1: there's a decent chance this goes unused, not even because

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Speaker 1: they didn't think it was a good gift, but because

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Speaker 1: it got lost somewhere they didn't get around to. It

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Speaker 1: fell behind the cracks of your dresser or that kind

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Speaker 1: of whatever. And and that's kind of what I want

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Speaker 1: to avoid. I hate seeing like, just what is it

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Speaker 1: more than a billion dollars in uneedscope. It's it's like

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Speaker 1: so much money, but yeah, I.

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Speaker 2: Mean as a substantial amount of money. So it is

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Speaker 2: a lot, Yeah, that different retailers that they have on

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Speaker 2: their books as gift cards that hasn't quite yet been redeemed.

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Speaker 1: So even though I think I agree with you in

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Speaker 1: principle it's thoughtful right to give that, that's that that

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Speaker 1: can be though I don't know, but yeah, I think

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Speaker 1: it can be thoughtful and it shows, Hey, I want

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Speaker 1: you to have this interesting day. But if that gift

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Speaker 1: card gets lost or you know, misplaced, then that just

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Speaker 1: kind of went down the toilet.

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Speaker 2: Yeah, all right, we do have additional stories we're gonna

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Speaker 2: get to, including how bitcoiners need to beware. We will

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Speaker 2: get to that plus a few other stories right after

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Speaker 2: the break.

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Speaker 1: All right, the Friday flight continues said, of course, we

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Speaker 1: got to get to our Ludger's headline of the week.

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Speaker 1: This one is titled most stocks are bad for your wealth,

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Speaker 1: which doesn't sound like a great title, but.

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Speaker 2: I do like the headline because it makes it sound

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Speaker 2: like's like this is bad for your health to avoid

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Speaker 2: this thing, I like smoking. I like that. Oh yeah, exactly,

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Speaker 2: Surgeon General's warning, right, Jerne Palace warning.

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Speaker 1: This one comes from the Financial Times, which is a

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Speaker 1: great newspaper from across the pond, and so it just

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Speaker 1: made me think, like, wait a second, are you guys

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Speaker 1: telling me that investing in stocks is a bad idea? No,

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Speaker 1: of course, as always, this is a headline that's meant

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Speaker 1: to evoke a click in some sort of emotional response.

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Speaker 1: But let's check the numbers, right. The stats do show

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Speaker 1: that the majority fifty eight point six percent to be exact,

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Speaker 1: of stocks underperform a basic cash strategy. Right, so more

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Speaker 1: than half of stocks, if you were to invest in them,

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00:18:13,160 --> 00:18:15,320
Speaker 1: they would do worse than just holding on to your

433
00:18:15,320 --> 00:18:18,560
Speaker 1: dollar bills. The Financial Times literally concludes at the end

434
00:18:18,680 --> 00:18:21,760
Speaker 1: of this article that the median global stock has been

435
00:18:21,800 --> 00:18:24,719
Speaker 1: worse than dollars in a cookie jar, which is crazy.

436
00:18:24,760 --> 00:18:27,560
Speaker 1: So a bunch of stocks are not going to help

437
00:18:27,600 --> 00:18:31,040
Speaker 1: you out. And this is crazy but true. There's nuance

438
00:18:31,080 --> 00:18:33,159
Speaker 1: here though, right, just because most stocks won't help you

439
00:18:33,200 --> 00:18:35,720
Speaker 1: build wealth, it doesn't mean that investing in the market

440
00:18:35,760 --> 00:18:37,719
Speaker 1: as a whole is going to let you down. Right.

441
00:18:38,040 --> 00:18:40,800
Speaker 1: The stocks that don't suck, well, those ones more than

442
00:18:40,840 --> 00:18:42,520
Speaker 1: makeup for their underperforming peers.

443
00:18:42,800 --> 00:18:45,919
Speaker 2: Essentially, this entire story can be explained by looking at

444
00:18:45,920 --> 00:18:48,920
Speaker 2: the difference between average returns and median returns, because they're

445
00:18:48,960 --> 00:18:52,120
Speaker 2: looking at median returns and that's not what you get

446
00:18:52,160 --> 00:18:54,679
Speaker 2: when you invest in the entire market, which is what

447
00:18:54,720 --> 00:18:58,439
Speaker 2: we advocate for. Like it's like a modern day parable,

448
00:18:58,600 --> 00:19:01,040
Speaker 2: Like if you heard the story of when Elon Musk

449
00:19:01,080 --> 00:19:03,719
Speaker 2: walks into a bar, the net worth of everyone in

450
00:19:03,760 --> 00:19:06,720
Speaker 2: the bar on average goes up like twenty to fifty

451
00:19:06,760 --> 00:19:09,560
Speaker 2: million or something like that. Does that mean that each person,

452
00:19:09,640 --> 00:19:11,879
Speaker 2: each patron in that bar, that they actually got rich

453
00:19:11,960 --> 00:19:14,240
Speaker 2: or no, But if you're looking at the average.

454
00:19:13,960 --> 00:19:16,840
Speaker 1: It effectively does. And that is what happens when you

455
00:19:17,080 --> 00:19:20,760
Speaker 1: buy the entire market as opposed to individually picking stocks.

456
00:19:21,080 --> 00:19:23,560
Speaker 1: And by the way, we actually talked about the dangers

457
00:19:23,600 --> 00:19:27,000
Speaker 1: of single stock investing back in episode four ninety seven,

458
00:19:27,359 --> 00:19:29,600
Speaker 1: So that's one that you can go back and listen

459
00:19:29,600 --> 00:19:31,960
Speaker 1: to if you want to do a deep dive into

460
00:19:32,000 --> 00:19:34,240
Speaker 1: some investing. But let's kind of pull this all together.

461
00:19:34,280 --> 00:19:36,840
Speaker 1: This is not a case for hoarding cash.

462
00:19:36,840 --> 00:19:39,600
Speaker 2: We're not saying that it's a better move to stick

463
00:19:39,640 --> 00:19:42,400
Speaker 2: that money in your underword draw or in the cookie jar.

464
00:19:42,960 --> 00:19:46,560
Speaker 2: It's another argument though, in favor of index funds and

465
00:19:46,720 --> 00:19:50,480
Speaker 2: against investing in single stocks. Even though most stocks end

466
00:19:50,600 --> 00:19:54,320
Speaker 2: up doing worse than money that you're actually just keeping

467
00:19:54,520 --> 00:19:57,919
Speaker 2: as physical cash, it's still too difficult to pick the

468
00:19:57,960 --> 00:20:01,080
Speaker 2: actual winners in the actual lose. It's like going into

469
00:20:01,080 --> 00:20:03,320
Speaker 2: a bar. Let's say you didn't know what Elon Musk

470
00:20:03,359 --> 00:20:05,960
Speaker 2: looked like, and you had to like pick somebody and say, okay,

471
00:20:06,320 --> 00:20:08,520
Speaker 2: you get to share the wealth of one person in

472
00:20:08,560 --> 00:20:10,320
Speaker 2: as far, it's like, what if you don't end up

473
00:20:10,320 --> 00:20:12,640
Speaker 2: picking the guy that's saddled with like forty thousand dollars

474
00:20:12,680 --> 00:20:15,080
Speaker 2: in student loan debt. That's essentially the equivalent of single

475
00:20:15,119 --> 00:20:17,080
Speaker 2: stock investing. You don't know which ones are going to perform.

476
00:20:17,160 --> 00:20:19,560
Speaker 2: So that's why we we like to point folks towards

477
00:20:19,880 --> 00:20:22,120
Speaker 2: index investing, investing in the entire market. I don't even

478
00:20:22,160 --> 00:20:24,679
Speaker 2: like typically saying investing in stocks because it does have

479
00:20:24,720 --> 00:20:28,199
Speaker 2: that connotation of okay, well, which ones as opposed to say, no,

480
00:20:28,240 --> 00:20:29,679
Speaker 2: you need to invest in the market.

481
00:20:29,720 --> 00:20:31,560
Speaker 1: The only single stock you should own is one share

482
00:20:31,600 --> 00:20:32,800
Speaker 1: of AMS in.

483
00:20:32,920 --> 00:20:33,520
Speaker 2: Order to get that Bob.

484
00:20:33,680 --> 00:20:35,200
Speaker 1: Yeah, because usually it really is the hope and a

485
00:20:35,240 --> 00:20:37,200
Speaker 1: hunch and a prayer sort of mentality when it comes

486
00:20:37,200 --> 00:20:40,360
Speaker 1: to single stock investing. It's like, oh, well I watch Netflix,

487
00:20:40,359 --> 00:20:43,959
Speaker 1: sometimes I should invest in that, or it's like whatever,

488
00:20:44,040 --> 00:20:47,239
Speaker 1: I mean that CEO, he's kind of crazy and out there.

489
00:20:47,280 --> 00:20:49,639
Speaker 1: Maybe I should invest in that stock. But there's so

490
00:20:49,800 --> 00:20:53,520
Speaker 1: many things that influence the value in the direction of

491
00:20:53,200 --> 00:20:56,439
Speaker 1: a of single stock, and that it's just a really,

492
00:20:56,560 --> 00:20:58,919
Speaker 1: even if that company is great, it doesn't mean their

493
00:20:58,920 --> 00:21:01,840
Speaker 1: stock is properly valued, right, And so yeah, it looks

494
00:21:01,880 --> 00:21:05,400
Speaker 1: like maybe, let's say Nvidia has a lot of room

495
00:21:05,440 --> 00:21:07,479
Speaker 1: to run as a company, doesn't mean their stock has

496
00:21:07,480 --> 00:21:09,439
Speaker 1: a lot of room to run. Not necessarily. It might

497
00:21:09,480 --> 00:21:12,280
Speaker 1: be super overvalued right now. I don't know who knows.

498
00:21:12,440 --> 00:21:14,280
Speaker 1: That's the thing though, we don't know. And like it

499
00:21:14,600 --> 00:21:17,639
Speaker 1: literally takes dedicating your entire life, like Charlie Munger or

500
00:21:18,000 --> 00:21:21,600
Speaker 1: Warren Buffett to analyzing different companies, then yeah, you might

501
00:21:21,600 --> 00:21:24,040
Speaker 1: be able to outperform Otherwise the rest of us, all

502
00:21:24,040 --> 00:21:26,200
Speaker 1: the rest of us peons you invest in the entire market.

503
00:21:26,280 --> 00:21:29,439
Speaker 1: And that's honestly, why so many individual investors end up

504
00:21:29,560 --> 00:21:33,400
Speaker 1: underperforming the index and underperforming other more conservative ways of

505
00:21:33,440 --> 00:21:36,720
Speaker 1: investing too, is because they're trading frequently.

506
00:21:36,359 --> 00:21:38,919
Speaker 2: Based on what they read some headline exactly.

507
00:21:38,960 --> 00:21:40,399
Speaker 1: They're like, oh, maybe you should hop in on that

508
00:21:40,440 --> 00:21:44,000
Speaker 1: one then or And I think I heard Carl Richards,

509
00:21:44,320 --> 00:21:46,680
Speaker 1: who does like those sketches on the napkins for the

510
00:21:46,680 --> 00:21:47,359
Speaker 1: New York Times.

511
00:21:47,560 --> 00:21:48,520
Speaker 2: He the behavior guy.

512
00:21:48,800 --> 00:21:51,399
Speaker 1: He I think recently said if you don't have something

513
00:21:51,440 --> 00:21:54,040
Speaker 1: in your portfolio that's underperforming that you're kind of annoyed with,

514
00:21:54,200 --> 00:21:56,600
Speaker 1: you're not diversified enough. And so yeah, I think like

515
00:21:56,640 --> 00:21:58,879
Speaker 1: the fact that we're diversified. We're not going to have

516
00:21:59,440 --> 00:22:02,000
Speaker 1: the tops. We're not gonna have, We're not gonna be

517
00:22:02,080 --> 00:22:04,359
Speaker 1: overweighted towards the stocks that are doing the absolute best.

518
00:22:04,520 --> 00:22:07,080
Speaker 1: But it also prevents us from that downside, being too

519
00:22:07,119 --> 00:22:09,200
Speaker 1: heavily invested in some of these stocks that are gonna

520
00:22:09,560 --> 00:22:13,359
Speaker 1: perform worse than cashing our wallet. So something else, by

521
00:22:13,400 --> 00:22:16,720
Speaker 1: the way, that can impact your returns is your bitcoin exposure.

522
00:22:17,040 --> 00:22:19,479
Speaker 1: And the folks at morning Star did a ride up

523
00:22:19,520 --> 00:22:21,280
Speaker 1: on this, and they found that even just a little

524
00:22:21,280 --> 00:22:24,560
Speaker 1: bit of bitcoin will add a lot of volatility to

525
00:22:24,640 --> 00:22:27,159
Speaker 1: the mix of your investments, and too much volatility can

526
00:22:27,160 --> 00:22:29,320
Speaker 1: cause you to take actions that you probably wouldn't have

527
00:22:29,320 --> 00:22:31,760
Speaker 1: made otherwise. Right, And so they give this example of

528
00:22:31,800 --> 00:22:35,880
Speaker 1: how adding just five percent bitcoin to your portfolio, which

529
00:22:35,880 --> 00:22:38,640
Speaker 1: is in our estimation, the absolute most you should have

530
00:22:39,320 --> 00:22:41,960
Speaker 1: to like a balance portfolio of sixty forty portfolio of

531
00:22:42,000 --> 00:22:44,800
Speaker 1: stocks and bonds, well, from a volatility perspective, it's going

532
00:22:44,840 --> 00:22:47,280
Speaker 1: to make it feel more like a ninety ten ninety

533
00:22:47,280 --> 00:22:49,720
Speaker 1: percent stocks ten percent bond portfolio. And so for a

534
00:22:49,720 --> 00:22:52,200
Speaker 1: lot of people, I just I think it's important to

535
00:22:52,200 --> 00:22:54,280
Speaker 1: say the right crypto exposure for a whole lot of people.

536
00:22:54,280 --> 00:22:56,879
Speaker 1: The right bitcoin exposure is zero, because if you do

537
00:22:56,960 --> 00:22:59,080
Speaker 1: opt to invest in bitcoin at all, even just a

538
00:22:59,080 --> 00:23:02,520
Speaker 1: little bit, that you'll experience bigger portfolio swings. Can you

539
00:23:02,560 --> 00:23:05,760
Speaker 1: handle it, then you might be okay having a little

540
00:23:05,760 --> 00:23:08,200
Speaker 1: bit of exposure, but know that these swings are often

541
00:23:08,240 --> 00:23:10,320
Speaker 1: what cause investors to make changes that aren't in their

542
00:23:10,359 --> 00:23:12,040
Speaker 1: best interest. And so I thought that was a good

543
00:23:12,040 --> 00:23:14,359
Speaker 1: write up. It's helpful because there's still a lot of

544
00:23:14,400 --> 00:23:16,800
Speaker 1: interest even though I guess, I don't know, is the

545
00:23:16,840 --> 00:23:19,600
Speaker 1: crypto winter still around? It seems like bitcoin hasn't done

546
00:23:19,680 --> 00:23:20,080
Speaker 1: much right.

547
00:23:20,400 --> 00:23:23,240
Speaker 2: It's doing pretty good over the I guess the past year,

548
00:23:23,280 --> 00:23:26,080
Speaker 2: it's but not compared to it's high it's like two

549
00:23:26,359 --> 00:23:29,119
Speaker 2: three years ago or whatnot. But let's talk about a

550
00:23:29,119 --> 00:23:31,439
Speaker 2: new way jel for us to spend our money. Not

551
00:23:31,600 --> 00:23:35,640
Speaker 2: us personally because we avoid TikTok and got time for that.

552
00:23:35,920 --> 00:23:38,720
Speaker 2: But tilly, if we are on TikTok, but we you

553
00:23:38,800 --> 00:23:41,800
Speaker 2: and I have no control of Yeah, personally, I am

554
00:23:41,800 --> 00:23:44,199
Speaker 2: not on there. Don't want to get sucked in. But

555
00:23:44,240 --> 00:23:47,760
Speaker 2: the TikTok shop has now been unleashed, and yeah, that's

556
00:23:48,040 --> 00:23:50,960
Speaker 2: yet another way that they've greased the skids and the

557
00:23:51,000 --> 00:23:52,920
Speaker 2: different social media companies are trying to part you from

558
00:23:52,920 --> 00:23:55,800
Speaker 2: your money. The algorithm they're on TikTok of course, it's

559
00:23:55,840 --> 00:24:00,000
Speaker 2: promoting different videos that are promoting products that you can

560
00:24:00,040 --> 00:24:02,639
Speaker 2: hand purchase via TikTok shop, and so doom scrolling. It's

561
00:24:02,680 --> 00:24:05,400
Speaker 2: not only gonna suck all of your time, but it's

562
00:24:05,440 --> 00:24:07,800
Speaker 2: also gonna cost you money. It's gonna steal your money

563
00:24:07,840 --> 00:24:10,360
Speaker 2: as well. And so we would recommend to either take

564
00:24:10,400 --> 00:24:13,840
Speaker 2: the app off your home screen or just considering deleting

565
00:24:13,880 --> 00:24:16,880
Speaker 2: it altogether because you're gonna be able to avoid this

566
00:24:16,960 --> 00:24:19,840
Speaker 2: new virtual mall. You'll probably be a little bit happier

567
00:24:19,880 --> 00:24:23,040
Speaker 2: as well, based on any of the recent research that

568
00:24:23,520 --> 00:24:27,879
Speaker 2: the impact that has on mental health. But it's I

569
00:24:27,880 --> 00:24:30,520
Speaker 2: wanted to admit that I buy things on social media,

570
00:24:30,560 --> 00:24:33,080
Speaker 2: specifically Instagram, but I feel like it's a little bit

571
00:24:33,080 --> 00:24:37,080
Speaker 2: different because I've when I see an ad on Instagram,

572
00:24:37,440 --> 00:24:39,639
Speaker 2: it high like it feels more like a marketplace, at

573
00:24:39,720 --> 00:24:43,040
Speaker 2: least in my own experience. I know that, for instance, Steepencheep,

574
00:24:43,160 --> 00:24:46,040
Speaker 2: they serve me up a Patagonia down jacket that was

575
00:24:46,280 --> 00:24:49,920
Speaker 2: on massive sale. I'm a basic bro Okay, I got

576
00:24:49,960 --> 00:24:52,159
Speaker 2: my Paddy to go to jacket. But what it feels

577
00:24:52,160 --> 00:24:54,080
Speaker 2: like TikTok is doing is that it feels like they're

578
00:24:54,119 --> 00:24:58,280
Speaker 2: actually manufacturing consumption. Like it's almost as if they're manufacturing

579
00:24:58,320 --> 00:25:01,520
Speaker 2: demand and they're selling stuff that I'm sure there might

580
00:25:01,520 --> 00:25:03,879
Speaker 2: be some decent stuff up there within the shop, but

581
00:25:03,880 --> 00:25:07,119
Speaker 2: it feels like stuff that is part meme and like

582
00:25:07,119 --> 00:25:11,920
Speaker 2: they're basically blurring the line between memes and real life essentially,

583
00:25:12,600 --> 00:25:14,119
Speaker 2: And so I feel like what that does is it

584
00:25:14,160 --> 00:25:17,600
Speaker 2: just feels consumption. It feels waste, Like have you seen

585
00:25:17,800 --> 00:25:19,920
Speaker 2: have you heard about like these pickle t shirts or

586
00:25:19,960 --> 00:25:23,080
Speaker 2: the stuff like that, where I'm just like, okay, you

587
00:25:23,119 --> 00:25:25,680
Speaker 2: have blurred the line up between social media and real

588
00:25:25,720 --> 00:25:28,639
Speaker 2: life and when it comes to different memes and what

589
00:25:28,680 --> 00:25:31,080
Speaker 2: it is that think how things are trending online and

590
00:25:31,119 --> 00:25:33,520
Speaker 2: on social media. It costs you your time if you

591
00:25:33,560 --> 00:25:34,879
Speaker 2: are kind of getting sucked into that. But they are

592
00:25:34,920 --> 00:25:37,359
Speaker 2: on actual products being manufactured. And I hate this because

593
00:25:37,400 --> 00:25:40,760
Speaker 2: it just feels like fast faction, fast fashion taken to

594
00:25:40,840 --> 00:25:42,959
Speaker 2: like the nth degree, where someone's going to get something

595
00:25:43,000 --> 00:25:45,280
Speaker 2: because they think it's funny and maybe they wear it

596
00:25:45,359 --> 00:25:47,879
Speaker 2: or they use it whatever for like a week and

597
00:25:47,920 --> 00:25:49,600
Speaker 2: then it just ends up in the landfall. I hate

598
00:25:49,800 --> 00:25:52,359
Speaker 2: that aspect of what it feels like that the TikTok

599
00:25:52,359 --> 00:25:53,080
Speaker 2: shop is doing well.

600
00:25:53,080 --> 00:25:54,560
Speaker 1: And I think you and I would say, whether it's

601
00:25:54,600 --> 00:25:56,879
Speaker 1: TikTok or Instagram, however, you're getting served ads and you

602
00:25:56,920 --> 00:25:59,119
Speaker 1: see something it's like, oh, that's a decent deal, and

603
00:25:59,160 --> 00:26:02,440
Speaker 1: that's something that I would like, Well, incorporate a twenty

604
00:26:02,480 --> 00:26:05,080
Speaker 1: four or forty eight hour rule right where you're like, Okay,

605
00:26:05,080 --> 00:26:07,120
Speaker 1: do I still feel this way about that jacket or

606
00:26:07,160 --> 00:26:10,000
Speaker 1: that pill shirt forty eight hours later, and if you don't,

607
00:26:10,040 --> 00:26:12,000
Speaker 1: if you're saying, well, well, in the moment, yeah, it

608
00:26:12,000 --> 00:26:13,760
Speaker 1: seemed nice and it seemed like a good deal, but

609
00:26:13,840 --> 00:26:16,520
Speaker 1: now I'm realizing, wait, I have other financial priorities. If

610
00:26:16,560 --> 00:26:18,360
Speaker 1: you have a rule like that in place, and you're

611
00:26:18,359 --> 00:26:20,800
Speaker 1: not buying stuff on a whim, that's being served up

612
00:26:20,840 --> 00:26:23,080
Speaker 1: to you realize there's being You can't go on the

613
00:26:23,119 --> 00:26:26,159
Speaker 1: internet now and not be and not have someone attempt

614
00:26:26,200 --> 00:26:28,240
Speaker 1: to sell you something. And so the more we can

615
00:26:28,359 --> 00:26:31,240
Speaker 1: avoid that and incorporate habits into our lives that prevent

616
00:26:31,320 --> 00:26:34,120
Speaker 1: us from making knee jerk purchases, I think that's what's important.

617
00:26:34,200 --> 00:26:36,240
Speaker 1: And you mentioned it's the virtual mall like that, that's

618
00:26:36,240 --> 00:26:37,280
Speaker 1: the perfect way to phrase it.

619
00:26:37,320 --> 00:26:41,040
Speaker 2: Like they're just perusing along and something flashes in front

620
00:26:41,040 --> 00:26:43,880
Speaker 2: of you, like you weren't necessarily looking for something. And again,

621
00:26:43,920 --> 00:26:44,639
Speaker 2: I know it's a fine line.

622
00:26:44,680 --> 00:26:46,760
Speaker 1: It's wait, it's like Spenser's like the Goofy t shirts

623
00:26:46,760 --> 00:26:48,080
Speaker 1: and stuff like that. I don't even know if that

624
00:26:48,119 --> 00:26:50,560
Speaker 1: store still exists, but that's that's kind of what TikTok's

625
00:26:50,560 --> 00:26:53,080
Speaker 1: trying to do. And you didn't need the like Burdon

626
00:26:53,119 --> 00:26:55,720
Speaker 1: Earning Goofy retro shirt or anything like that, but now

627
00:26:55,840 --> 00:26:56,760
Speaker 1: TikTok says.

628
00:26:56,560 --> 00:26:57,800
Speaker 2: Hey, oh, why don't you check it?

629
00:26:58,040 --> 00:27:00,199
Speaker 1: And then that then they're like, yeah, why not? But

630
00:27:00,520 --> 00:27:02,360
Speaker 1: that money adds up, right, And there's this.

631
00:27:02,440 --> 00:27:04,240
Speaker 2: Hey, it's your money, you spend it like you want.

632
00:27:04,320 --> 00:27:05,919
Speaker 1: You spend it like you want, but create habits to

633
00:27:05,920 --> 00:27:08,320
Speaker 1: prevent you from spending it in a knee jerk way,

634
00:27:08,440 --> 00:27:11,480
Speaker 1: and they're gonna upend your budget. And there's another TikTok trend,

635
00:27:11,520 --> 00:27:13,280
Speaker 1: by the way, it's apparently called girl math man. I

636
00:27:13,320 --> 00:27:15,320
Speaker 1: don't know if you've heard of this sounds kind of sexist.

637
00:27:15,320 --> 00:27:16,320
Speaker 2: I don't know if I'm allowed to be.

638
00:27:16,320 --> 00:27:18,639
Speaker 1: Talking about it, but it's kind of a joke really,

639
00:27:18,640 --> 00:27:21,280
Speaker 1: Like one of the girl math trends is to view

640
00:27:21,320 --> 00:27:24,359
Speaker 1: cash as free money, or to think that you're making

641
00:27:24,400 --> 00:27:26,399
Speaker 1: money when you don't buy a Lotte at your favorite

642
00:27:26,400 --> 00:27:29,120
Speaker 1: coffee shop that day, or that you're losing money when

643
00:27:29,119 --> 00:27:31,800
Speaker 1: you don't buy something that's a good deal. All those

644
00:27:31,840 --> 00:27:32,679
Speaker 1: things are not true.

645
00:27:32,840 --> 00:27:33,640
Speaker 2: We know that, right.

646
00:27:33,800 --> 00:27:37,120
Speaker 1: Basically it's dumb mental accounting. But it's something that we've

647
00:27:37,160 --> 00:27:39,800
Speaker 1: all been guilty of at different times, right, Yeah, we've

648
00:27:39,840 --> 00:27:42,000
Speaker 1: all done something like that to justify something that we

649
00:27:42,040 --> 00:27:43,679
Speaker 1: want to buy, like a splurts that we want to

650
00:27:43,760 --> 00:27:46,760
Speaker 1: partake in as a way to emotionally not feel as

651
00:27:46,800 --> 00:27:49,480
Speaker 1: bad about it. But just because these jokes are swirling

652
00:27:49,520 --> 00:27:51,800
Speaker 1: around social media, don't let them impact how you view

653
00:27:51,840 --> 00:27:54,920
Speaker 1: your dollars. Right, your dollars are workers that can help

654
00:27:54,920 --> 00:27:57,320
Speaker 1: you on the path the financial independence. And yes, that

655
00:27:57,359 --> 00:27:59,400
Speaker 1: includes physical cash. That's real money too.

656
00:27:59,800 --> 00:28:03,159
Speaker 2: And even though personally for me that isn't a completely

657
00:28:03,160 --> 00:28:06,119
Speaker 2: separate bucket as well, because it's just it's literally not

658
00:28:06,119 --> 00:28:08,240
Speaker 2: on the books anywhere, and I keep like this little

659
00:28:08,280 --> 00:28:11,080
Speaker 2: stash of petty cash around, yeah, which doesn't feel real,

660
00:28:11,280 --> 00:28:12,480
Speaker 2: though I know it is exactly.

661
00:28:12,520 --> 00:28:15,360
Speaker 1: But I think if you trick yourself into thinking that

662
00:28:15,600 --> 00:28:18,320
Speaker 1: some of these purchases are free money, or that not

663
00:28:18,400 --> 00:28:21,880
Speaker 1: spending money is saving money, those are different things, right.

664
00:28:21,960 --> 00:28:24,480
Speaker 2: I saw some folks justifying that, like, if you get

665
00:28:24,720 --> 00:28:26,800
Speaker 2: you split a bill a friend, venmo's you some money,

666
00:28:26,840 --> 00:28:28,520
Speaker 2: and so that money is sitting there in your Venmo account,

667
00:28:28,560 --> 00:28:30,720
Speaker 2: it feels unaccounted for. Oh, that's free money, and you

668
00:28:30,760 --> 00:28:31,800
Speaker 2: can just spend it however you want.

669
00:28:31,840 --> 00:28:33,760
Speaker 1: But no, you should be accounting for that, and especially

670
00:28:33,760 --> 00:28:36,840
Speaker 1: if you have big financial goals, every dollar matters, that's right.

671
00:28:36,920 --> 00:28:38,560
Speaker 2: Yeah. But what makes it funny, though, is that there

672
00:28:38,640 --> 00:28:40,800
Speaker 2: is a kernel of true. What makes anything funny is

673
00:28:40,840 --> 00:28:44,400
Speaker 2: that it's slightly true, and so it's okay to laugh

674
00:28:44,440 --> 00:28:46,960
Speaker 2: at it and enjoy the joke, but simultaneously, we hope

675
00:28:46,960 --> 00:28:49,800
Speaker 2: that you are making wise decisions with your money, that

676
00:28:49,840 --> 00:28:52,200
Speaker 2: you are doing the right things. Jill, did you see

677
00:28:52,240 --> 00:28:55,160
Speaker 2: that there are no longer any cars that you can

678
00:28:55,200 --> 00:28:57,040
Speaker 2: mind you that are less than twenty thousand dollars? Now?

679
00:28:57,200 --> 00:29:01,640
Speaker 2: See that? Yeah? So the Mitsubishi mirage is just like that.

680
00:29:01,680 --> 00:29:05,680
Speaker 2: It's a mirage no longer exists. It's calm, which personally

681
00:29:05,680 --> 00:29:08,680
Speaker 2: I don't even know what a Missubishi Mirage looks like,

682
00:29:08,880 --> 00:29:10,520
Speaker 2: and say, in my mind, I didn't know anybody that

683
00:29:10,600 --> 00:29:12,240
Speaker 2: drove one. And so I feel like that the sub

684
00:29:12,280 --> 00:29:15,640
Speaker 2: twenty thousand dollars car, maybe it disappeared a long time.

685
00:29:15,520 --> 00:29:17,520
Speaker 1: Ago, but it's a couple of years ago that there

686
00:29:17,520 --> 00:29:19,520
Speaker 1: were some others too that were sub twenty The Corolla

687
00:29:19,600 --> 00:29:21,760
Speaker 1: used to be one. Really that was a dependable sub

688
00:29:21,800 --> 00:29:23,720
Speaker 1: twenty k car, but now it's a and that was

689
00:29:23,760 --> 00:29:25,800
Speaker 1: just the starting price, by the way, like that sure

690
00:29:25,880 --> 00:29:27,560
Speaker 1: when you put on extra stuff, it was gonna cost

691
00:29:27,600 --> 00:29:27,920
Speaker 1: more than that.

692
00:29:27,920 --> 00:29:30,320
Speaker 2: Any more expensive. Yeah, it's a bummer because it seems

693
00:29:30,360 --> 00:29:33,440
Speaker 2: like cars are getting more affordable less affordable, I should say,

694
00:29:33,600 --> 00:29:36,360
Speaker 2: Which got me thinking, though, is this just is this

695
00:29:36,440 --> 00:29:39,239
Speaker 2: the reality or is this just perception? Is just just

696
00:29:39,280 --> 00:29:40,960
Speaker 2: what it seems to be? And so I actually, so

697
00:29:40,960 --> 00:29:42,600
Speaker 2: I did a little bit of research. I started digging,

698
00:29:43,080 --> 00:29:45,520
Speaker 2: and I was like, Okay, what's a good solid car

699
00:29:45,880 --> 00:29:47,720
Speaker 2: that they made like thirty years ago? So I was like, oh,

700
00:29:47,760 --> 00:29:50,000
Speaker 2: like a Honda Accord. So I look back in nineteen

701
00:29:50,040 --> 00:29:53,080
Speaker 2: ninety three, how much do you think a new Honda Accord.

702
00:29:52,840 --> 00:29:56,280
Speaker 1: Cost nineteen ninety three. I'm gonna say it costs fourteen

703
00:29:56,840 --> 00:29:57,320
Speaker 1: hundred dollars.

704
00:29:57,400 --> 00:29:59,760
Speaker 2: Oh my gosh, excellent. Guess it was like right around

705
00:29:59,760 --> 00:30:02,360
Speaker 2: fifty ten thousand dollars, all right, And so, but what

706
00:30:02,640 --> 00:30:05,880
Speaker 2: do you think the average annual salary was in nineteen

707
00:30:05,960 --> 00:30:06,400
Speaker 2: ninety three.

708
00:30:06,440 --> 00:30:09,800
Speaker 1: I'm gonna say the average annual salary was thirty nine

709
00:30:10,160 --> 00:30:10,840
Speaker 1: eight hundred dollars.

710
00:30:10,880 --> 00:30:13,320
Speaker 2: So it was thirty thousand dollars. Okay, thirty thousand dollars.

711
00:30:13,320 --> 00:30:16,680
Speaker 2: So you do the math. Basically, a good solid car

712
00:30:16,960 --> 00:30:20,240
Speaker 2: back thirty years ago was about half of the annual salary.

713
00:30:20,240 --> 00:30:24,320
Speaker 2: And so, so guess what the annual American salary is today? Wow,

714
00:30:24,320 --> 00:30:26,400
Speaker 2: I'll just tell you it's like seventy four thousand, sixty

715
00:30:26,600 --> 00:30:28,560
Speaker 2: is it's right at sixty thousand dollars. So based on

716
00:30:28,560 --> 00:30:31,040
Speaker 2: that math, that should tell you that, okay, maybe a

717
00:30:31,080 --> 00:30:33,880
Speaker 2: solid decent car today that's new should cost you around

718
00:30:33,880 --> 00:30:37,600
Speaker 2: thirty thousand dollars, which is, you know, obviously substantially more

719
00:30:37,640 --> 00:30:39,760
Speaker 2: than a twenty thousand dollars vehicle. And so I guess

720
00:30:40,000 --> 00:30:43,280
Speaker 2: I wanted to present that piece of information. I guess

721
00:30:43,280 --> 00:30:45,320
Speaker 2: with with some of the numbers are showing because even

722
00:30:45,360 --> 00:30:49,959
Speaker 2: though there are fewer affordable cars in relation to what

723
00:30:50,040 --> 00:30:52,239
Speaker 2: cars used to cost. It it seems like it's kind

724
00:30:52,280 --> 00:30:54,719
Speaker 2: of keeping in line. It seems to be tracking well.

725
00:30:54,720 --> 00:30:56,440
Speaker 1: The average price of a new car sold in America

726
00:30:56,520 --> 00:30:59,200
Speaker 1: is like forty five hundred dollars, So that's true.

727
00:30:59,280 --> 00:31:01,320
Speaker 2: Yeah, I mean that also takes into account just how

728
00:31:01,480 --> 00:31:04,240
Speaker 2: nice cars have gotten, right, that's true. Definitely isn't apples

729
00:31:04,240 --> 00:31:05,000
Speaker 2: to apples.

730
00:31:04,720 --> 00:31:06,240
Speaker 1: And according which is three is not the same as

731
00:31:06,240 --> 00:31:07,360
Speaker 1: an accord in twenty twenty.

732
00:31:07,200 --> 00:31:08,560
Speaker 2: Three, That is true. That is true.

733
00:31:08,560 --> 00:31:10,640
Speaker 1: Same with houses, right, Like houses have improved in a lot,

734
00:31:10,680 --> 00:31:13,120
Speaker 1: so're you're not comparing apples to have apples on either

735
00:31:13,160 --> 00:31:15,240
Speaker 1: one of these. But it is I think disheartening for

736
00:31:15,280 --> 00:31:18,720
Speaker 1: people to see that it's hard to buy a new

737
00:31:18,760 --> 00:31:22,160
Speaker 1: car for sub twenty k and car prices are still

738
00:31:22,240 --> 00:31:25,600
Speaker 1: just kind of crazy right now, which only reinforces keep

739
00:31:25,640 --> 00:31:27,600
Speaker 1: your car longer, like maintain.

740
00:31:27,280 --> 00:31:29,320
Speaker 2: It well, consider used as well. If folks are out

741
00:31:29,360 --> 00:31:31,640
Speaker 2: there and they've never actually purchased a used car, I mean,

742
00:31:31,680 --> 00:31:34,720
Speaker 2: you could like, do not take that depreciation hit, buy

743
00:31:34,720 --> 00:31:36,960
Speaker 2: a car that's three years old, save a ton of money,

744
00:31:37,000 --> 00:31:38,720
Speaker 2: and have a virtually new car. Yeah.

745
00:31:38,720 --> 00:31:41,239
Speaker 1: I ran into my best friend from childhood growing up

746
00:31:41,280 --> 00:31:43,400
Speaker 1: you're my current best friend, so oh yeah, don't feel

747
00:31:43,400 --> 00:31:45,040
Speaker 1: like you. But so he and I went to a

748
00:31:45,280 --> 00:31:48,040
Speaker 1: concert the other the other day and he pulled up

749
00:31:48,280 --> 00:31:52,080
Speaker 1: in his in his Hyundai. It's thirteen years old. He

750
00:31:52,160 --> 00:31:55,240
Speaker 1: paid thirteen thousand dollars for it thirteen years ago and

751
00:31:55,240 --> 00:31:56,680
Speaker 1: he's still driving it. And by the way, it's like

752
00:31:56,720 --> 00:31:59,480
Speaker 1: just like tiny accounto box and he's like six six, which.

753
00:31:59,280 --> 00:32:01,240
Speaker 2: I just think is a mate. People.

754
00:32:01,280 --> 00:32:03,160
Speaker 1: It gets pretty good, guess mama, If you're willing to

755
00:32:03,200 --> 00:32:05,200
Speaker 1: suffer a little bit, drive something that's not very cool,

756
00:32:05,240 --> 00:32:07,320
Speaker 1: that might not even be all that comfortable, you can

757
00:32:07,400 --> 00:32:08,920
Speaker 1: save a ton of money. And that's all that car

758
00:32:08,960 --> 00:32:11,480
Speaker 1: has done for him. He bought a brand new Yeah.

759
00:32:11,320 --> 00:32:13,240
Speaker 2: I just heard you. I just read a stered to

760
00:32:13,320 --> 00:32:14,640
Speaker 2: my mind. So you and this other guy, I bet

761
00:32:14,720 --> 00:32:16,960
Speaker 2: y'all are on like the front row at the oh yeah,

762
00:32:17,120 --> 00:32:20,120
Speaker 2: blocking to everybody's right hey down in front.

763
00:32:20,440 --> 00:32:22,480
Speaker 1: But it's just a good lesson, right, Like couldn't afford

764
00:32:22,480 --> 00:32:24,680
Speaker 1: something nice for sure? But does he choose to drive

765
00:32:24,680 --> 00:32:26,760
Speaker 1: this so he can spend money freely in other wise?

766
00:32:26,840 --> 00:32:28,480
Speaker 2: Yeah? He does. And I don't know.

767
00:32:28,520 --> 00:32:29,920
Speaker 1: I think it's a good example.

768
00:32:30,200 --> 00:32:32,280
Speaker 2: Absolutely all right. I think that's gonna be it for

769
00:32:32,360 --> 00:32:34,760
Speaker 2: this Friday flight. You can find all the stories that

770
00:32:34,760 --> 00:32:37,560
Speaker 2: we mentioned today up on the website at howamoney dot com.

771
00:32:37,600 --> 00:32:39,680
Speaker 2: There in the show notes, we'll link to any of

772
00:32:39,680 --> 00:32:41,800
Speaker 2: the resources that we may have mentioned. But Buddy, that's

773
00:32:41,840 --> 00:32:44,840
Speaker 2: gonna be it for this episode. So until next time,

774
00:32:44,960 --> 00:32:47,800
Speaker 2: best Friends Out, Best Friends Out,