1 00:00:00,080 --> 00:00:03,400 Speaker 1: Welcome to Had of Money. I'm Joel and I am Matt, 2 00:00:03,440 --> 00:00:07,600 Speaker 1: and today we're asking the question how complicated should investing be? 3 00:00:27,400 --> 00:00:30,600 Speaker 2: Yeah, So, speaking of investing, did you realize I didn't realize. 4 00:00:30,320 --> 00:00:32,320 Speaker 1: This until recently, until a couple of weeks. 5 00:00:32,120 --> 00:00:37,000 Speaker 2: Ago, but we just exited the longest bear market since 6 00:00:37,240 --> 00:00:40,519 Speaker 2: nineteen forty eight? Oh wow, isn't that crazy? I'm just 7 00:00:40,520 --> 00:00:42,559 Speaker 2: crazy to think about it. So here's feel that long ago. 8 00:00:42,680 --> 00:00:45,199 Speaker 2: Ultimately it really did. And this is so the reason 9 00:00:45,240 --> 00:00:46,920 Speaker 2: I'll bring this up is because I love the fact 10 00:00:47,000 --> 00:00:50,400 Speaker 2: that we didn't even really notice that, and hopefully listeners 11 00:00:50,520 --> 00:00:53,400 Speaker 2: didn't notice that either, because they were just continuing to 12 00:00:53,479 --> 00:00:56,520 Speaker 2: invest like clockwork, continuing to plug money into the market. 13 00:00:56,520 --> 00:01:00,240 Speaker 2: But oftentimes folks aren't doing that because they are over 14 00:01:00,280 --> 00:01:02,800 Speaker 2: complicating things. They're making it a little too complex, is 15 00:01:02,880 --> 00:01:05,760 Speaker 2: keeping them from their financial goals. And so we're going 16 00:01:05,840 --> 00:01:08,119 Speaker 2: to try to make sure that does not happen from 17 00:01:08,120 --> 00:01:10,280 Speaker 2: here on out if you're listening to this podcast. Yeah, 18 00:01:10,280 --> 00:01:12,720 Speaker 2: and there's a couple things I think that might make 19 00:01:12,800 --> 00:01:15,360 Speaker 2: sense to complicate a little bit on the investing front. 20 00:01:15,440 --> 00:01:18,080 Speaker 2: But how complex you get and what you you know, 21 00:01:18,120 --> 00:01:19,679 Speaker 2: what you choose to investment. We're going to talk about 22 00:01:19,680 --> 00:01:23,160 Speaker 2: a bunch of different ways you can complicate things and 23 00:01:23,240 --> 00:01:25,160 Speaker 2: maybe it's good, and then other ways in which you 24 00:01:25,200 --> 00:01:28,040 Speaker 2: can overdo it. So that's the that you should completely avoid. 25 00:01:28,200 --> 00:01:30,640 Speaker 2: That's the theme of this of this combo in this episode. 26 00:01:30,840 --> 00:01:33,440 Speaker 2: What's this You wanted to talk about getting beers last 27 00:01:33,520 --> 00:01:35,440 Speaker 2: night or something? Okay, So we got beers with a 28 00:01:35,440 --> 00:01:38,040 Speaker 2: friend last night, Uh huh. And there's free parking all 29 00:01:38,080 --> 00:01:42,000 Speaker 2: around where we hang but there's also a paid parking 30 00:01:42,040 --> 00:01:45,120 Speaker 2: lot when all the free parking's taken really close to 31 00:01:45,160 --> 00:01:48,600 Speaker 2: this particular establishment. Yes, And I was driving from across 32 00:01:48,600 --> 00:01:51,320 Speaker 2: town and they were I couldn't find a free parking spot, 33 00:01:51,520 --> 00:01:52,920 Speaker 2: and I did want to be a Jurrik and be 34 00:01:53,080 --> 00:01:55,600 Speaker 2: and be late when when we'd had this hang plan 35 00:01:55,680 --> 00:01:58,480 Speaker 2: for a little while, so I paid five bucks for 36 00:01:58,520 --> 00:01:59,560 Speaker 2: parking and I hate that. 37 00:01:59,640 --> 00:02:02,000 Speaker 1: There's like not much I hate more than that. And 38 00:02:02,040 --> 00:02:04,200 Speaker 1: so but then we were walking to the car after 39 00:02:04,720 --> 00:02:07,040 Speaker 1: hanging out, and he pointed out a couple of free spots. 40 00:02:07,120 --> 00:02:08,480 Speaker 1: I didn't know about it. He's like, these are the 41 00:02:08,560 --> 00:02:10,680 Speaker 1: this is the low hanging fruit. No one's ever spots. 42 00:02:10,880 --> 00:02:12,639 Speaker 1: So hopefully I'll never have to do it again. 43 00:02:12,680 --> 00:02:15,160 Speaker 2: Okay, So I got a couple of follow ups then, Okay, 44 00:02:15,160 --> 00:02:16,880 Speaker 2: so when you were meeting up, yeah, like with a 45 00:02:16,919 --> 00:02:19,280 Speaker 2: friend for beers, how late is too late because there's 46 00:02:19,280 --> 00:02:22,160 Speaker 2: like a certain amount of window unless like you're it's 47 00:02:22,200 --> 00:02:24,359 Speaker 2: a business meeting and like you're meeting a client. Obviously, 48 00:02:24,440 --> 00:02:26,200 Speaker 2: if you're if you're on time, you're late. Like basically 49 00:02:26,240 --> 00:02:27,639 Speaker 2: you need to get there early. But when it comes 50 00:02:27,680 --> 00:02:29,680 Speaker 2: to like friend hangs, what's your window of time? 51 00:02:30,120 --> 00:02:32,120 Speaker 1: Think i'd be in past ten minutes late? Feels just 52 00:02:32,160 --> 00:02:34,760 Speaker 1: oh yeah, rude, Okay, I totally if you're like three 53 00:02:34,760 --> 00:02:36,160 Speaker 1: to five minutes late, it's it's probably not. 54 00:02:36,280 --> 00:02:38,240 Speaker 2: Three to five, which is why because I saw you 55 00:02:38,280 --> 00:02:41,320 Speaker 2: walking into the place last night and I was like, 56 00:02:41,360 --> 00:02:42,800 Speaker 2: oh crap, do I need to go ahead and pay 57 00:02:42,840 --> 00:02:44,520 Speaker 2: for parking as well? And it was it was like 58 00:02:44,560 --> 00:02:46,200 Speaker 2: four or five minutes after and so I was like, 59 00:02:46,200 --> 00:02:50,640 Speaker 2: all right, I'm gonna circle the blog more time. And okay, 60 00:02:50,639 --> 00:02:52,640 Speaker 2: So I so you heard a free spot firee spot. 61 00:02:52,680 --> 00:02:54,880 Speaker 2: I paid like an idiot. So okay, what are your 62 00:02:54,880 --> 00:02:57,960 Speaker 2: thoughts on how do you feel about questionable parking spots 63 00:02:58,040 --> 00:03:00,720 Speaker 2: like spots that obviously if something is marked and it 64 00:03:00,760 --> 00:03:03,600 Speaker 2: says no parking. I don't. You're not gonna park there. 65 00:03:03,600 --> 00:03:05,520 Speaker 2: There's a good chance you might get towed whatever, make 66 00:03:05,560 --> 00:03:09,160 Speaker 2: somebody upset. But I guess I mentioned this because I 67 00:03:09,160 --> 00:03:11,400 Speaker 2: feel like for years I have parked in spots that 68 00:03:11,440 --> 00:03:13,959 Speaker 2: are like, oh, I'm not totally sure this is a 69 00:03:14,040 --> 00:03:16,800 Speaker 2: legit spot. It doesn't say no parking, it's not right 70 00:03:16,840 --> 00:03:18,760 Speaker 2: in front of a fire hydrant, there's no red curb, 71 00:03:18,800 --> 00:03:21,239 Speaker 2: that kind of thing. And I can't remember the last 72 00:03:21,240 --> 00:03:23,360 Speaker 2: time I got a parking ticket. Yeah, it's a you 73 00:03:23,400 --> 00:03:25,520 Speaker 2: gotta know what you're risking, right, and exactly I think 74 00:03:25,520 --> 00:03:26,919 Speaker 2: I took a risk I'm willing to take a couple 75 00:03:26,919 --> 00:03:28,240 Speaker 2: of years ago, when I was meeting a friend down 76 00:03:28,280 --> 00:03:29,640 Speaker 2: by the airport, he was in town for a second. 77 00:03:29,639 --> 00:03:32,079 Speaker 2: We grab beers and I parked in I think where 78 00:03:32,120 --> 00:03:34,280 Speaker 2: like they the valet. 79 00:03:33,960 --> 00:03:36,200 Speaker 1: Would park cars. But it was raining super hard, there 80 00:03:36,240 --> 00:03:38,240 Speaker 1: was nobody out there, and there were plenty of spots, 81 00:03:38,280 --> 00:03:40,000 Speaker 1: and so I risked it and I didn't get a ticket, 82 00:03:40,000 --> 00:03:42,320 Speaker 1: which is great, but I also knew I might get 83 00:03:42,360 --> 00:03:44,280 Speaker 1: a ticket or somebody might say something to me. 84 00:03:44,320 --> 00:03:46,480 Speaker 2: Did you had you said something to the valet? Was 85 00:03:46,480 --> 00:03:48,000 Speaker 2: there when they're like a valet there and you're. 86 00:03:47,880 --> 00:03:49,600 Speaker 1: Like, hey, or is this a thing? So I don't 87 00:03:49,600 --> 00:03:51,080 Speaker 1: think there was anybody there, which is why I was like, 88 00:03:51,120 --> 00:03:53,960 Speaker 1: all right, I'm just gonna give it a shot. But yeah, well, 89 00:03:54,200 --> 00:03:56,720 Speaker 1: paying for parking is a pet pia mine. Every once 90 00:03:56,720 --> 00:03:59,120 Speaker 1: in a while, you gotta know what you're willing to risk. Yeah, 91 00:03:59,160 --> 00:04:01,000 Speaker 1: all right, let's mention the beer we're having on this episode. 92 00:04:01,000 --> 00:04:03,960 Speaker 1: This one's called Symptom of Progeny. It's a golden sour 93 00:04:04,280 --> 00:04:06,120 Speaker 1: ale that you picked up Matt at burial So. 94 00:04:06,160 --> 00:04:07,480 Speaker 2: And not only did I pick one up for us, 95 00:04:07,520 --> 00:04:10,000 Speaker 2: I actually picked up three additional bottles for Kate and 96 00:04:10,040 --> 00:04:12,280 Speaker 2: I because we had this at the brewery and we 97 00:04:12,480 --> 00:04:15,200 Speaker 2: liked it that much. At the time, I was thinking, 98 00:04:15,440 --> 00:04:18,280 Speaker 2: this is a perfect barrel aged golden ale. So I'm 99 00:04:18,279 --> 00:04:19,560 Speaker 2: looking forward to sharing it with you today. 100 00:04:19,640 --> 00:04:22,120 Speaker 1: Same here. All right, Well, let's get to the subject 101 00:04:22,160 --> 00:04:25,200 Speaker 1: of hand. Matt. We're talking about how complicated investing should be, 102 00:04:25,600 --> 00:04:27,920 Speaker 1: and it just maybe think back when we were renovating 103 00:04:27,920 --> 00:04:29,960 Speaker 1: our home before we made the move to the Burbs, 104 00:04:30,480 --> 00:04:33,839 Speaker 1: and I'd never really done that massive of a renovation 105 00:04:34,240 --> 00:04:36,799 Speaker 1: and it was kind of fun to pick out specific 106 00:04:36,839 --> 00:04:40,040 Speaker 1: finishes for all the stuff we were doing, like the tile. 107 00:04:40,920 --> 00:04:43,040 Speaker 2: Yeah, the tile in particular was. 108 00:04:43,279 --> 00:04:47,040 Speaker 1: Top and it was just it was a fun endeavor 109 00:04:47,400 --> 00:04:49,800 Speaker 1: up until a point, and then it started started to 110 00:04:49,839 --> 00:04:52,320 Speaker 1: kind of get old after a while. Right, there were 111 00:04:52,440 --> 00:04:55,760 Speaker 1: endless options of everything, and even picking out that tile, 112 00:04:55,960 --> 00:04:58,279 Speaker 1: it took a lot of searching and looking to find 113 00:04:58,279 --> 00:05:00,880 Speaker 1: the exact kind that we wanted. Then, so at a 114 00:05:00,960 --> 00:05:03,680 Speaker 1: certain point in the process I kind of got decision fatigue, right, 115 00:05:04,279 --> 00:05:08,880 Speaker 1: discussing paint colors and toilets even which who knew that 116 00:05:08,920 --> 00:05:10,920 Speaker 1: you could really go down a rabbit hole of toilets, 117 00:05:10,960 --> 00:05:13,280 Speaker 1: but yes you can, especially these days online. There's so many, 118 00:05:13,600 --> 00:05:16,240 Speaker 1: so many different toilets you could get, and at some 119 00:05:16,279 --> 00:05:18,320 Speaker 1: point you just stop carring which toilet suit your vibe 120 00:05:18,360 --> 00:05:21,200 Speaker 1: the best right And investment choices I think can be 121 00:05:21,240 --> 00:05:25,440 Speaker 1: similar to that kind of process of when you're renovating 122 00:05:25,440 --> 00:05:27,760 Speaker 1: and all the choices you have, the choice overload. There's 123 00:05:27,839 --> 00:05:30,080 Speaker 1: so many directions you can go in on the investing front, 124 00:05:30,240 --> 00:05:34,359 Speaker 1: all sorts of options that you can consider, and I 125 00:05:34,360 --> 00:05:36,480 Speaker 1: do think it for some things in life, more can 126 00:05:36,520 --> 00:05:40,320 Speaker 1: be merrier, right, but it can also backfire, and things 127 00:05:40,320 --> 00:05:43,960 Speaker 1: that could be fun or could be energizing ways in 128 00:05:44,000 --> 00:05:46,960 Speaker 1: which more choice can be beneficial well as possible for 129 00:05:47,400 --> 00:05:49,960 Speaker 1: it to go too far, especially especially when we're talking 130 00:05:49,960 --> 00:05:52,479 Speaker 1: about building wealth, and so would we would say, And 131 00:05:52,520 --> 00:05:54,039 Speaker 1: something we talk about on the show regularly is that 132 00:05:54,120 --> 00:05:57,040 Speaker 1: complicating things doesn't always make them better, and in fact, 133 00:05:57,200 --> 00:06:00,640 Speaker 1: the opposite is typically true, and especially on the investing front. 134 00:06:00,760 --> 00:06:01,120 Speaker 1: That's right. 135 00:06:01,200 --> 00:06:03,760 Speaker 2: Yeah, so you even said the term decision fatigue, and 136 00:06:03,800 --> 00:06:07,120 Speaker 2: that's when basically you are spending an inordinate amount of 137 00:06:07,120 --> 00:06:10,560 Speaker 2: time trying to decide which of the many, many options 138 00:06:10,560 --> 00:06:12,880 Speaker 2: you have available to you is going to suit you best. 139 00:06:13,040 --> 00:06:16,599 Speaker 2: And when it comes to investing specifically, there are so 140 00:06:16,960 --> 00:06:20,520 Speaker 2: many options, so many distractions that can keep us from 141 00:06:20,520 --> 00:06:23,359 Speaker 2: investing the way that we should with the vast majority 142 00:06:23,400 --> 00:06:25,320 Speaker 2: of our money. And you know, when there is that 143 00:06:25,480 --> 00:06:28,839 Speaker 2: much noise, which is often coming from the talking heads 144 00:06:28,880 --> 00:06:32,440 Speaker 2: in financial media, it is no wonder that we start thinking, 145 00:06:32,440 --> 00:06:35,200 Speaker 2: Like we start asking ourselves, well, maybe I should be 146 00:06:35,240 --> 00:06:39,120 Speaker 2: investing internationally, right, Like I should probably diversify. 147 00:06:38,600 --> 00:06:41,400 Speaker 1: More value stocks in my portfolio, invest. 148 00:06:41,120 --> 00:06:43,880 Speaker 2: In wine and art as well. I've heard that the 149 00:06:43,920 --> 00:06:47,120 Speaker 2: returns on ESG funds they're pretty solid, So maybe that's 150 00:06:47,120 --> 00:06:49,440 Speaker 2: the direction I should be going. But many of those 151 00:06:49,520 --> 00:06:52,400 Speaker 2: questions and considerations they don't actually help all that much, 152 00:06:52,440 --> 00:06:55,200 Speaker 2: and in fact, they end up distracting us from from 153 00:06:55,200 --> 00:06:57,640 Speaker 2: doing what it is that we should be doing. But 154 00:06:57,839 --> 00:07:01,159 Speaker 2: that doesn't necessarily mean that we should bury our heads 155 00:07:01,160 --> 00:07:03,320 Speaker 2: in the sand. We think it is important to know 156 00:07:03,680 --> 00:07:06,640 Speaker 2: what the other options out there are and then why 157 00:07:06,760 --> 00:07:09,840 Speaker 2: it is that we should either consider them or ignore 158 00:07:09,840 --> 00:07:10,520 Speaker 2: them all together. 159 00:07:10,640 --> 00:07:12,640 Speaker 1: That's part of the reason we like Aldi, Matt is 160 00:07:12,640 --> 00:07:16,040 Speaker 1: because there's just fewer things, fewer choices right at your disposal. 161 00:07:16,280 --> 00:07:18,800 Speaker 1: There's like one ketchup and so you just get the 162 00:07:18,920 --> 00:07:21,600 Speaker 1: ketchup as you're walking by, and the simplicity even know 163 00:07:21,640 --> 00:07:25,720 Speaker 1: what is it? Burman's lines, Yeah, and it's just nice 164 00:07:25,720 --> 00:07:27,600 Speaker 1: to know, Okay, cool, I need ketchup, and I don't 165 00:07:27,600 --> 00:07:30,679 Speaker 1: have to look at the price pronounce and different brand 166 00:07:30,720 --> 00:07:32,920 Speaker 1: names and which ones on sale right now. You just 167 00:07:33,040 --> 00:07:35,760 Speaker 1: grab the ketchup and it's so easy. So I think, yeah, 168 00:07:35,760 --> 00:07:37,800 Speaker 1: we could stand to have a little more like Aldi 169 00:07:38,040 --> 00:07:40,440 Speaker 1: in the way we think about investing. And part of 170 00:07:40,480 --> 00:07:42,520 Speaker 1: the reason we're talking about this today is because when 171 00:07:42,560 --> 00:07:45,720 Speaker 1: market conditions are good, there's even more of an inclination 172 00:07:45,800 --> 00:07:48,640 Speaker 1: to shake things up to start overthinking things, and you mentioned, hey, 173 00:07:48,640 --> 00:07:52,040 Speaker 1: guess what, now we've ended that longest bear run and 174 00:07:52,240 --> 00:07:55,680 Speaker 1: we're in a bold market right now. When we are 175 00:07:55,680 --> 00:07:58,120 Speaker 1: in that bear market, though, when things are going badly, 176 00:07:58,800 --> 00:08:01,080 Speaker 1: when the stock market is performing poorly, nobody wants to 177 00:08:01,080 --> 00:08:04,520 Speaker 1: discuss smart investing methods. Everyone's just kind of like covering 178 00:08:04,520 --> 00:08:05,720 Speaker 1: their head. They're grinning and bearing it. 179 00:08:05,760 --> 00:08:07,400 Speaker 2: The assumption is that the market is going to continue 180 00:08:07,400 --> 00:08:09,280 Speaker 2: to drop, and so why would you start investing if 181 00:08:09,320 --> 00:08:11,640 Speaker 2: things are going to continue along the same path. 182 00:08:11,720 --> 00:08:14,680 Speaker 1: Yeah, But then again, when things start going gangbusters, everybody's 183 00:08:14,720 --> 00:08:17,000 Speaker 1: got an opinion, right. And so now that we are 184 00:08:17,040 --> 00:08:19,360 Speaker 1: officially in this bowl market, we're up twenty percent from 185 00:08:19,440 --> 00:08:22,440 Speaker 1: from those lows. We're seeing certain stocks popping in a 186 00:08:22,440 --> 00:08:25,760 Speaker 1: big way, and I think more people are more inclined 187 00:08:26,040 --> 00:08:29,040 Speaker 1: to start fiddling with their portfolio. It holds a greater 188 00:08:29,160 --> 00:08:32,040 Speaker 1: allure right now when things are going up up into 189 00:08:32,040 --> 00:08:35,200 Speaker 1: the right and the boring index fund route, it seems 190 00:08:35,200 --> 00:08:37,640 Speaker 1: more intelligent, I think when the market is going down, 191 00:08:38,000 --> 00:08:40,040 Speaker 1: but on the way up, it just it feels kind 192 00:08:40,040 --> 00:08:42,560 Speaker 1: of like you should be making moves to amplify those gains, right, 193 00:08:42,720 --> 00:08:46,520 Speaker 1: Why settle for average, when certain things are popping off 194 00:08:46,760 --> 00:08:49,960 Speaker 1: to greater degrees. But just because it's more exciting or 195 00:08:50,040 --> 00:08:52,480 Speaker 1: just because it's more enticing, that doesn't mean it's the 196 00:08:52,520 --> 00:08:54,480 Speaker 1: direction you should be heading in. That's right, Yeah. 197 00:08:54,480 --> 00:08:57,240 Speaker 2: And also we're not just talking about the you know, 198 00:08:57,320 --> 00:08:59,280 Speaker 2: that part of your portfolio that you want to speculate 199 00:08:59,320 --> 00:09:02,360 Speaker 2: with that five percent or less that you'll hear us 200 00:09:02,360 --> 00:09:05,120 Speaker 2: mention here on the show as a pressure relief valve. Now, 201 00:09:05,120 --> 00:09:07,040 Speaker 2: we still think that this is a good rule of thumb, 202 00:09:07,280 --> 00:09:09,800 Speaker 2: good thing to maintain. And for a lot of folks 203 00:09:09,880 --> 00:09:13,400 Speaker 2: who do like to tinker, I think having a negligible 204 00:09:13,480 --> 00:09:15,960 Speaker 2: amount of money that you can trade just for funzis 205 00:09:16,240 --> 00:09:18,880 Speaker 2: helps them to stay the course and to keep doing 206 00:09:19,480 --> 00:09:23,080 Speaker 2: the boring, old standard, bland thing with the bulk of 207 00:09:23,160 --> 00:09:26,160 Speaker 2: their investment dollars. So eat your heart out with that 208 00:09:26,200 --> 00:09:28,679 Speaker 2: small percentage of play investment dollars. 209 00:09:28,440 --> 00:09:30,760 Speaker 1: Go to town, do the funkiest things you can. 210 00:09:30,640 --> 00:09:34,280 Speaker 2: Think of the money though that you're willing to completely lose. Right, 211 00:09:34,600 --> 00:09:36,760 Speaker 2: But what we're talking about today is the other ninety 212 00:09:36,800 --> 00:09:38,000 Speaker 2: five percent of your portfolio. 213 00:09:38,480 --> 00:09:40,280 Speaker 1: A few specific. 214 00:09:39,800 --> 00:09:42,400 Speaker 2: Temptations, and then why it is that most of them 215 00:09:42,400 --> 00:09:43,640 Speaker 2: should probably be avoided. 216 00:09:43,760 --> 00:09:45,480 Speaker 1: Yeah, it's not that we have a problem with folks 217 00:09:45,480 --> 00:09:49,560 Speaker 1: getting a little wild and a little speculative. It's just 218 00:09:49,880 --> 00:09:52,600 Speaker 1: like five percent wild exactly. You just can't let it 219 00:09:52,679 --> 00:09:55,520 Speaker 1: infect all the other areas that you're trying to do 220 00:09:55,880 --> 00:09:58,920 Speaker 1: the boring, proven method of building wealth, right and so 221 00:09:59,000 --> 00:10:01,120 Speaker 1: totally if you leg it out hand, I feel like 222 00:10:01,160 --> 00:10:05,440 Speaker 1: it can kind of tank the majority of what of 223 00:10:05,480 --> 00:10:07,560 Speaker 1: your assets that are going to be doing just the 224 00:10:07,600 --> 00:10:11,320 Speaker 1: standard normal thing, which is investing in total overall stock 225 00:10:11,320 --> 00:10:13,520 Speaker 1: market kind of thing. Right. And we're also we're not 226 00:10:13,520 --> 00:10:16,240 Speaker 1: going to focus too much on timing today, right, whether 227 00:10:16,679 --> 00:10:18,600 Speaker 1: now is a good time to start investing if you 228 00:10:18,640 --> 00:10:22,839 Speaker 1: haven't already, because for most people, dollar cost averaging is 229 00:10:23,000 --> 00:10:26,120 Speaker 1: the best approach, right sticking your money into your four 230 00:10:26,200 --> 00:10:29,200 Speaker 1: one K, your IRA, or your HSA your Health Save 231 00:10:29,240 --> 00:10:32,000 Speaker 1: mus account, which we always talk about as being an 232 00:10:32,040 --> 00:10:35,040 Speaker 1: awesome investment vehicle. Most people don't think of it that way. 233 00:10:35,120 --> 00:10:37,360 Speaker 2: Talked about it on Monday. Yeah, we've been hitting it 234 00:10:37,360 --> 00:10:39,160 Speaker 2: more lately. Yeah, Yeah, it's a good thing. It is 235 00:10:39,200 --> 00:10:41,679 Speaker 2: because people need to know that. And if you're investing 236 00:10:41,800 --> 00:10:44,120 Speaker 2: in each of those vehicles like clockwork, every time you 237 00:10:44,160 --> 00:10:46,600 Speaker 2: get paid without giving it a second thought. This is 238 00:10:46,640 --> 00:10:48,560 Speaker 2: the best way to go, right, And so when it 239 00:10:48,600 --> 00:10:51,520 Speaker 2: comes to timing, it's not something that we're fans of, 240 00:10:51,600 --> 00:10:53,840 Speaker 2: and in fact, it's really easy to screw that up 241 00:10:53,840 --> 00:10:56,400 Speaker 2: and actually shoot yourself in the foot as you're trying 242 00:10:56,440 --> 00:10:59,840 Speaker 2: to time your entrance into the market in a given 243 00:11:00,040 --> 00:11:03,840 Speaker 2: on through year. But this strategy, the dollar cost averaging strategy, 244 00:11:03,840 --> 00:11:06,880 Speaker 2: it works because you're able to remove your emotions from 245 00:11:06,920 --> 00:11:09,800 Speaker 2: the equation, and our emotions can get the best of us. 246 00:11:10,040 --> 00:11:12,240 Speaker 2: But that being said, if you really want to optimize 247 00:11:12,400 --> 00:11:15,920 Speaker 2: for the highest returns, the data show that lump some 248 00:11:16,040 --> 00:11:18,400 Speaker 2: investing at the beginning of the year or as soon 249 00:11:18,440 --> 00:11:20,400 Speaker 2: as you're able to fund a retirement account is the 250 00:11:20,400 --> 00:11:22,040 Speaker 2: way to go. And I guess the reason we talk 251 00:11:22,040 --> 00:11:25,079 Speaker 2: about dollar cost averaging is and not lump some, it's 252 00:11:25,120 --> 00:11:27,319 Speaker 2: just because that's how most people get paid. That's the 253 00:11:27,360 --> 00:11:29,800 Speaker 2: way it makes most sense. But most folks aren't sitting 254 00:11:29,840 --> 00:11:32,920 Speaker 2: on like a massive pile when this. 255 00:11:32,960 --> 00:11:35,720 Speaker 1: You know. But if you are, if you do have 256 00:11:35,760 --> 00:11:38,200 Speaker 1: the money in January to fully fund your roth IRA 257 00:11:38,440 --> 00:11:40,480 Speaker 1: or something like that, go for it. Go to town. 258 00:11:40,600 --> 00:11:42,480 Speaker 1: That's a better thing to do than do the doing 259 00:11:42,520 --> 00:11:45,360 Speaker 1: the dollar cost averaging approach. It's just that specifically, with 260 00:11:45,400 --> 00:11:47,840 Speaker 1: something like a four to oh one k, it makes 261 00:11:47,880 --> 00:11:51,400 Speaker 1: sense to deploy it every single paycheck. So really the 262 00:11:51,440 --> 00:11:53,640 Speaker 1: timing that we're talking about is the sooner the better, 263 00:11:53,800 --> 00:11:56,480 Speaker 1: and the more regular the better too. Yeah, and I mean, 264 00:11:56,520 --> 00:11:58,920 Speaker 1: I do think it's worth maybe trying to work towards 265 00:11:59,000 --> 00:12:01,520 Speaker 1: that lump some kind of mindset. If you're able to 266 00:12:01,840 --> 00:12:04,000 Speaker 1: slowly over time over the years, kind of get ahead 267 00:12:04,000 --> 00:12:07,040 Speaker 1: of it, right, So as opposed to you get paid, 268 00:12:07,040 --> 00:12:09,640 Speaker 1: do you invest a portion of that but stockpiling that 269 00:12:09,679 --> 00:12:11,200 Speaker 1: ahead time, So if you're able to max that out, 270 00:12:11,280 --> 00:12:13,600 Speaker 1: make that payment that year, but then slowly over time 271 00:12:13,880 --> 00:12:16,520 Speaker 1: you build up essentially like a little war chest, so 272 00:12:16,559 --> 00:12:18,640 Speaker 1: that when the new year does hit and you are 273 00:12:18,760 --> 00:12:21,320 Speaker 1: able to invest in those retirement accounts for the next year. 274 00:12:22,120 --> 00:12:25,000 Speaker 1: The ability to make that happen sooner rather than later, 275 00:12:25,160 --> 00:12:28,000 Speaker 1: it does over the long haul return you higher returns. 276 00:12:28,200 --> 00:12:29,400 Speaker 1: But then when it comes. 277 00:12:29,280 --> 00:12:32,040 Speaker 2: To the actual securities or the actual investments that we're making, 278 00:12:32,360 --> 00:12:35,920 Speaker 2: there's also a lot of nuance involved. Some things are 279 00:12:35,960 --> 00:12:38,240 Speaker 2: going to be more negotiable than others, and some of 280 00:12:38,240 --> 00:12:40,080 Speaker 2: the things we're going to mention today might actually be 281 00:12:40,240 --> 00:12:43,840 Speaker 2: worth considering. So we'll talk about some of those alongside 282 00:12:43,880 --> 00:12:46,240 Speaker 2: some ways that folks are attempted to invest their money 283 00:12:46,320 --> 00:12:47,840 Speaker 2: right now that we think are going to be a 284 00:12:47,840 --> 00:12:51,360 Speaker 2: distraction at best, but it actually could be damaging your 285 00:12:51,360 --> 00:12:52,760 Speaker 2: future returns at worst. 286 00:12:52,840 --> 00:12:56,880 Speaker 1: Yeah, and it feels like we have more investment options 287 00:12:56,920 --> 00:12:58,679 Speaker 1: at our disposal than ever before. So it's like the 288 00:12:58,720 --> 00:13:01,240 Speaker 1: opposite of all the like I was talking about, Matt, Now, 289 00:13:01,240 --> 00:13:03,440 Speaker 1: it's just like plethor of this range and not just 290 00:13:03,480 --> 00:13:06,400 Speaker 1: inside of our four oh one k, but then even 291 00:13:06,559 --> 00:13:10,560 Speaker 1: all of these exterior alternative investment possibilities that we could 292 00:13:10,559 --> 00:13:13,120 Speaker 1: partake in that we're getting pitched right and left in 293 00:13:13,160 --> 00:13:16,240 Speaker 1: different places, whether it's a newsletter that you read, or 294 00:13:16,320 --> 00:13:20,360 Speaker 1: whether it's commercials that you see or social media advertisements, 295 00:13:20,400 --> 00:13:21,120 Speaker 1: just talking with friends. 296 00:13:21,120 --> 00:13:23,400 Speaker 2: I feel like it's a conversation I have more often 297 00:13:23,520 --> 00:13:26,199 Speaker 2: as I've gotten older. Folks and rightly so, are more 298 00:13:26,200 --> 00:13:29,160 Speaker 2: interested in investing. But just because folks are talking about 299 00:13:29,160 --> 00:13:31,040 Speaker 2: it doesn't mean that it's something that you that you 300 00:13:31,040 --> 00:13:34,439 Speaker 2: should be considering, because but it's all enticing and it's like, yeah, 301 00:13:35,640 --> 00:13:36,680 Speaker 2: your eyes can get as wide. 302 00:13:36,520 --> 00:13:37,920 Speaker 1: As saucer as you're like, wait, I cant invest in 303 00:13:37,920 --> 00:13:40,040 Speaker 1: that or this or that. That's amazing, but then you 304 00:13:40,480 --> 00:13:42,160 Speaker 1: I think a lot of people lose the plot if 305 00:13:42,200 --> 00:13:44,240 Speaker 1: they start to go down that rabbit hole, and maybe 306 00:13:44,280 --> 00:13:47,200 Speaker 1: they miss out on the main course. So yeah, let's 307 00:13:47,200 --> 00:13:50,440 Speaker 1: talk about some of those added investing complications, when to 308 00:13:50,440 --> 00:13:52,360 Speaker 1: say yes, when to say no. We'll get to more 309 00:13:52,400 --> 00:13:53,400 Speaker 1: on that right after this. 310 00:14:02,800 --> 00:14:04,800 Speaker 2: All right, we are back and we're talking about the 311 00:14:04,920 --> 00:14:08,840 Speaker 2: many different forms that investing can take. And we're gonna 312 00:14:09,000 --> 00:14:13,080 Speaker 2: kick this off with international stocks, because this is one 313 00:14:13,280 --> 00:14:15,840 Speaker 2: I feel like it's kind of gained some steam lately. Joel. 314 00:14:15,960 --> 00:14:20,040 Speaker 2: Neither you nor I have much exposure to international stocks ourselves, 315 00:14:20,440 --> 00:14:23,360 Speaker 2: and we actually feel pretty good about our decision. But 316 00:14:23,400 --> 00:14:25,440 Speaker 2: there are a lot of smart folks out there who 317 00:14:25,720 --> 00:14:28,840 Speaker 2: have a different take. And again, yeah, it's a topic 318 00:14:28,880 --> 00:14:31,880 Speaker 2: worth discussing because we get the question from listeners sometimes 319 00:14:31,920 --> 00:14:36,280 Speaker 2: as well. But Jack Bogel, he's the founder of Van Guard. 320 00:14:36,320 --> 00:14:38,120 Speaker 2: He's a pretty brilliant dude. 321 00:14:38,120 --> 00:14:39,720 Speaker 1: Passed away what a year or two ago. 322 00:14:39,600 --> 00:14:42,280 Speaker 2: Yeah, went all that long ago. But he was famously 323 00:14:42,320 --> 00:14:45,760 Speaker 2: not a big fan of international diversification for a number 324 00:14:45,760 --> 00:14:48,000 Speaker 2: of reasons. And the truth is, so many of the 325 00:14:48,000 --> 00:14:51,680 Speaker 2: companies that you own in either a total stock market 326 00:14:51,760 --> 00:14:55,200 Speaker 2: index fund or an SMP five hundred index fund. They 327 00:14:55,240 --> 00:14:58,360 Speaker 2: do business overseas, and that was, honestly, that was Bogel's 328 00:14:58,360 --> 00:15:01,280 Speaker 2: main argument. Something like forty percent of s and P 329 00:15:01,480 --> 00:15:05,240 Speaker 2: five hundred revenues come from other countries come from overseas, 330 00:15:05,400 --> 00:15:08,920 Speaker 2: and so folks who have diversified to more international holdings 331 00:15:09,120 --> 00:15:12,480 Speaker 2: they haven't done as well. But of course past results 332 00:15:12,520 --> 00:15:15,320 Speaker 2: are not indicative of future returns, and so we're not 333 00:15:15,360 --> 00:15:17,880 Speaker 2: saying that like, oh, yeah, things, you should only be 334 00:15:17,960 --> 00:15:20,800 Speaker 2: investing in US companies. This isn't like a Even though 335 00:15:20,800 --> 00:15:24,280 Speaker 2: we love America for many reasons, we think that our 336 00:15:24,360 --> 00:15:27,680 Speaker 2: country is a very fertile ground that comes to starting 337 00:15:27,720 --> 00:15:30,480 Speaker 2: new industries and the ability for companies to get ahead, 338 00:15:30,640 --> 00:15:33,000 Speaker 2: that doesn't necessarily mean that over the long haul that 339 00:15:33,040 --> 00:15:36,320 Speaker 2: international stocks may not do better than the total US 340 00:15:36,360 --> 00:15:37,160 Speaker 2: stock market. Yeah. 341 00:15:37,160 --> 00:15:39,000 Speaker 1: Well, and the truth is our country is really only 342 00:15:39,040 --> 00:15:41,120 Speaker 1: four percent of the world's population, but we have our 343 00:15:41,160 --> 00:15:44,040 Speaker 1: stock market. The global wealth is something close to a 344 00:15:44,120 --> 00:15:46,800 Speaker 1: quarter of it. So and it turns out then when 345 00:15:46,840 --> 00:15:49,680 Speaker 1: you look at the numbers, international stocks are relatively inexpensive 346 00:15:49,680 --> 00:15:52,200 Speaker 1: these days, which is part of the reason we're probably 347 00:15:52,200 --> 00:15:54,360 Speaker 1: seeing more headlines about them in front of the show, 348 00:15:54,360 --> 00:15:56,440 Speaker 1: Ben Carlson Matt Who's just a brilliant mind of love 349 00:15:56,480 --> 00:15:59,400 Speaker 1: rereading his blog, he recently articulated his ues on why 350 00:15:59,440 --> 00:16:02,720 Speaker 1: folk should have more international stock exposure, and he said, 351 00:16:03,040 --> 00:16:06,880 Speaker 1: global diversification is about accepting good enough returns to avoid 352 00:16:06,920 --> 00:16:10,200 Speaker 1: the potential for terrible returns at an inopportune time. And 353 00:16:10,240 --> 00:16:12,000 Speaker 1: I think it's a really good way of thinking about it. 354 00:16:12,080 --> 00:16:14,960 Speaker 1: You're not necessarily if you do choose to invest internationally, 355 00:16:15,320 --> 00:16:18,600 Speaker 1: doing it because you're looking for outsized mega returns or 356 00:16:18,600 --> 00:16:21,400 Speaker 1: anything like that, and you might see better returns over 357 00:16:21,440 --> 00:16:24,920 Speaker 1: the next decade, who knows, But yeah, I think investing 358 00:16:24,920 --> 00:16:28,640 Speaker 1: internationally it's not a necessity. But given the outperformance that 359 00:16:28,680 --> 00:16:31,000 Speaker 1: the US stock market has seen recently in the past 360 00:16:31,040 --> 00:16:34,400 Speaker 1: decade plus, international stocks do look cheaper and more attractive 361 00:16:34,480 --> 00:16:36,600 Speaker 1: right now. This is one of those things where I 362 00:16:36,640 --> 00:16:39,800 Speaker 1: think you can complicate your life a little bit and 363 00:16:40,040 --> 00:16:43,280 Speaker 1: add international stocks to your portfolio. But it's also not 364 00:16:43,360 --> 00:16:44,360 Speaker 1: a have to. Yeah. 365 00:16:44,360 --> 00:16:46,200 Speaker 2: I think Ben's argument it's more from like a wealth 366 00:16:46,240 --> 00:16:50,200 Speaker 2: preservation standpoint, as opposed to him saying that like, oh, 367 00:16:50,280 --> 00:16:52,960 Speaker 2: things are going to be gangbusters overseas in the coming decade. 368 00:16:53,080 --> 00:16:55,720 Speaker 1: Some folks would point to Japan, whose stock market was 369 00:16:56,640 --> 00:16:59,000 Speaker 1: rocket and rolling in the nineteen eighties, and I think 370 00:16:59,080 --> 00:17:01,840 Speaker 1: finally just got back to nineteen navy levels like in 371 00:17:01,880 --> 00:17:04,880 Speaker 1: recent weeks. So multiple decades, yeah, so like last decades really, 372 00:17:04,920 --> 00:17:08,040 Speaker 1: which you know could happen if you're too heavy into 373 00:17:08,240 --> 00:17:08,800 Speaker 1: one country. 374 00:17:08,880 --> 00:17:11,480 Speaker 2: Yeah. But so even if you do want some international exposure, 375 00:17:11,520 --> 00:17:15,359 Speaker 2: don't go overboard and don't make massive changes quickly, like 376 00:17:15,359 --> 00:17:18,160 Speaker 2: all at once. I would consider keeping your portfolio as 377 00:17:18,160 --> 00:17:20,800 Speaker 2: it is, keep it intact, but then start investing any 378 00:17:21,000 --> 00:17:24,159 Speaker 2: new dollars into either target date funds or into another 379 00:17:24,480 --> 00:17:28,399 Speaker 2: international fund like Vanguard's Total World Market Fund. That ticker 380 00:17:28,520 --> 00:17:30,520 Speaker 2: symbol for that one is VT. And what's great about 381 00:17:30,560 --> 00:17:34,240 Speaker 2: those two, well, especially Vanguards, the costs are so incredibly low. 382 00:17:34,960 --> 00:17:36,359 Speaker 2: That's one of the things you get with Vanguard. 383 00:17:36,359 --> 00:17:39,200 Speaker 1: You get that international international exposure, but you're barely paying 384 00:17:39,200 --> 00:17:40,600 Speaker 1: more than what you pay for just an S and 385 00:17:40,640 --> 00:17:41,640 Speaker 1: P five hundred x fund. 386 00:17:41,720 --> 00:17:43,560 Speaker 2: It is a little bit more on the target date funds, 387 00:17:43,600 --> 00:17:46,600 Speaker 2: but they're I think it's fair because you are getting 388 00:17:46,600 --> 00:17:49,200 Speaker 2: an added benefit with those target date funds as it's 389 00:17:49,240 --> 00:17:50,880 Speaker 2: changing its allocation over the years. 390 00:17:50,880 --> 00:17:53,000 Speaker 1: And this is and it truly is the most set 391 00:17:53,040 --> 00:17:53,879 Speaker 1: it and bring out approach. 392 00:17:53,960 --> 00:17:56,479 Speaker 2: Yeah, well exactly, because I mean, I don't know if 393 00:17:56,520 --> 00:17:58,199 Speaker 2: we were planning even to talk about bonds. But a 394 00:17:58,200 --> 00:18:00,000 Speaker 2: big part of that too is it changes how much 395 00:18:00,160 --> 00:18:02,920 Speaker 2: of its holdings are in bonds, because when you're looking 396 00:18:03,000 --> 00:18:05,199 Speaker 2: really really far out, like bonds are more conservative and 397 00:18:05,240 --> 00:18:08,320 Speaker 2: so they're there oftentimes as a hedge two stocks. But 398 00:18:08,400 --> 00:18:10,879 Speaker 2: then especially with the target date funds that are that 399 00:18:10,880 --> 00:18:12,920 Speaker 2: we're quickly approaching, say like at twenty thirty fund, you're 400 00:18:12,920 --> 00:18:15,680 Speaker 2: going to see a much higher percentage of the allotment 401 00:18:15,720 --> 00:18:19,840 Speaker 2: of the portfolio towards bonds. But that doesn't necessarily mean 402 00:18:19,840 --> 00:18:21,600 Speaker 2: though that you should be going out and also buying 403 00:18:21,680 --> 00:18:24,720 Speaker 2: a bond index fund, because, especially if you are earlier 404 00:18:24,760 --> 00:18:28,160 Speaker 2: on in the wealth building stage of your investing life, 405 00:18:28,200 --> 00:18:31,280 Speaker 2: you can afford, you can handle to weather out those 406 00:18:31,640 --> 00:18:34,640 Speaker 2: the volatility, these storms of ups and downs, and in fact, 407 00:18:34,680 --> 00:18:38,160 Speaker 2: you can't afford to not be investing in actual stocks 408 00:18:38,240 --> 00:18:41,200 Speaker 2: over the long haul. The closer you get to retirement, yeah, 409 00:18:41,240 --> 00:18:42,960 Speaker 2: maybe you do want to de risk a little bit 410 00:18:43,240 --> 00:18:46,280 Speaker 2: and see more consistent returns, but you just need to 411 00:18:46,320 --> 00:18:48,920 Speaker 2: know that those returns are going to be slightly less 412 00:18:48,960 --> 00:18:51,360 Speaker 2: than if it was fully in stocks, but. 413 00:18:51,280 --> 00:18:53,359 Speaker 1: It's going to smooth out the bumps. Which, yeah, especially 414 00:18:53,359 --> 00:18:55,560 Speaker 1: as you're getting closer to withdrawing those funds, you want 415 00:18:55,560 --> 00:18:57,720 Speaker 1: those bumps to be smoothed out because it's going to 416 00:18:57,800 --> 00:19:03,040 Speaker 1: be really disheartening and potentially destroying to your lifestyle if 417 00:19:03,119 --> 00:19:06,280 Speaker 1: you're let's say your portfolio declined twenty percent or something 418 00:19:06,280 --> 00:19:08,240 Speaker 1: in a year you had a twenty twenty two style 419 00:19:08,320 --> 00:19:12,120 Speaker 1: year as you are leaving employment. That's a tough pill 420 00:19:12,119 --> 00:19:14,879 Speaker 1: to swallow. But let's talk about another thing mat that 421 00:19:14,880 --> 00:19:18,600 Speaker 1: can complicate people's portfolios, and that's investing in a socially 422 00:19:18,800 --> 00:19:22,359 Speaker 1: responsible way, opting for ESG funds, which is becoming more 423 00:19:22,359 --> 00:19:24,359 Speaker 1: and more popular. We're seeing a lot of people kind 424 00:19:24,400 --> 00:19:27,120 Speaker 1: of start to stock more of their money into these 425 00:19:27,200 --> 00:19:29,159 Speaker 1: kinds of funds. And there's ESG. 426 00:19:29,080 --> 00:19:32,359 Speaker 2: Stands for environmental, social and governance, so the way a 427 00:19:32,400 --> 00:19:33,720 Speaker 2: company is run. 428 00:19:33,800 --> 00:19:36,000 Speaker 1: Yeah, and there's just a lot more interest now in 429 00:19:36,080 --> 00:19:38,600 Speaker 1: these funds, and there's kind of a push to get 430 00:19:38,640 --> 00:19:41,480 Speaker 1: people to stick their money into these funds which claim 431 00:19:41,560 --> 00:19:44,000 Speaker 1: to be investing in ways that are better for the 432 00:19:44,080 --> 00:19:47,680 Speaker 1: environment and for other social reasons. But our take really 433 00:19:47,760 --> 00:19:50,560 Speaker 1: is that ESG is largely in the eye of the beholder, 434 00:19:51,040 --> 00:19:52,840 Speaker 1: and you can't make this up, Matt. But something I 435 00:19:52,840 --> 00:19:56,439 Speaker 1: saw last week Philip Morris, which is a company that 436 00:19:56,520 --> 00:20:00,080 Speaker 1: makes cigarettes that have killed so many people, millions of people, Well, 437 00:20:00,440 --> 00:20:03,600 Speaker 1: they're scoring higher in the ESG ratings than TESLA, like 438 00:20:03,680 --> 00:20:07,280 Speaker 1: significantly higher. Yes, G, I know. And so it's just like, 439 00:20:07,359 --> 00:20:10,200 Speaker 1: what in the world is ESG trying to accomplish? And 440 00:20:10,480 --> 00:20:13,479 Speaker 1: a similar thing, right, companies who are hijacking our attention, 441 00:20:13,520 --> 00:20:17,240 Speaker 1: they're making products with slave labor overseas, Like many of 442 00:20:17,240 --> 00:20:20,200 Speaker 1: those companies are also ESG darlings. They score well on 443 00:20:20,240 --> 00:20:23,320 Speaker 1: these ESG front So I think the lack of defineability 444 00:20:23,359 --> 00:20:26,040 Speaker 1: is a massive problem on the estre front. And it's 445 00:20:26,080 --> 00:20:27,760 Speaker 1: been sold as this way to do good with your 446 00:20:27,800 --> 00:20:30,359 Speaker 1: investment dollars, but that's not necessarily the way it shakes 447 00:20:30,359 --> 00:20:31,160 Speaker 1: out in reality. 448 00:20:31,280 --> 00:20:33,840 Speaker 2: Yeah, And ESG funds they actually so they not only 449 00:20:33,840 --> 00:20:37,520 Speaker 2: perform more poorly in a financial sense, offering worse returns 450 00:20:37,560 --> 00:20:40,560 Speaker 2: to investors, which is the main goal of investing, but 451 00:20:40,600 --> 00:20:44,280 Speaker 2: they're also actually worse on these ESG metrics than what 452 00:20:44,359 --> 00:20:46,200 Speaker 2: it does. These funds say that they're trying to achieve. 453 00:20:46,480 --> 00:20:49,600 Speaker 2: This is according to research out of Columbia University. We'll 454 00:20:49,600 --> 00:20:51,199 Speaker 2: linked to that in the show notes, but there are 455 00:20:51,200 --> 00:20:54,000 Speaker 2: other studies as well that have come to similar conclusions. 456 00:20:54,359 --> 00:20:58,600 Speaker 2: Opting for these ESG funds, it's not doing anything much 457 00:20:58,640 --> 00:21:02,480 Speaker 2: for the environment or to change corporate governance. And these 458 00:21:02,600 --> 00:21:06,200 Speaker 2: these funds, again, you know, they perform more poorly because 459 00:21:06,240 --> 00:21:09,679 Speaker 2: they come with higher fees oftentimes not to mention worse results. 460 00:21:09,680 --> 00:21:11,240 Speaker 2: So for a while there it seem like ESG funds 461 00:21:11,240 --> 00:21:13,400 Speaker 2: were actually performing better and it's just like, all right, 462 00:21:13,480 --> 00:21:15,639 Speaker 2: if that's the direction you want to go based on 463 00:21:15,720 --> 00:21:19,159 Speaker 2: past performance. But we're actually seeing that shift recently. But 464 00:21:19,320 --> 00:21:22,280 Speaker 2: all of those things are eating into your returns significantly 465 00:21:22,280 --> 00:21:24,440 Speaker 2: over time, and we think that most most folks should 466 00:21:24,440 --> 00:21:27,760 Speaker 2: actually avoid some of these newer ESG funds and instead 467 00:21:27,800 --> 00:21:30,720 Speaker 2: stick to traditional index funds. It's so difficult to define 468 00:21:30,760 --> 00:21:33,360 Speaker 2: what it is that these different ESG funds are trying 469 00:21:33,400 --> 00:21:37,199 Speaker 2: to achieve. So much of it it's not objective, it's subjective. 470 00:21:37,240 --> 00:21:39,600 Speaker 2: And so again for you as an individual, you might 471 00:21:40,280 --> 00:21:43,840 Speaker 2: hold different values than what it is that Meta is 472 00:21:43,880 --> 00:21:47,480 Speaker 2: trying to accomplish, or Microsoft or any company, regardless of 473 00:21:47,480 --> 00:21:49,679 Speaker 2: where they are on the ESG scale. And it's my 474 00:21:49,720 --> 00:21:52,520 Speaker 2: subjective view that electric cars are better than cigarettes for 475 00:21:52,600 --> 00:21:56,000 Speaker 2: people over time. So I'm just it's I'm curious. I 476 00:21:56,040 --> 00:21:58,600 Speaker 2: don't really know how. It feels like there's like the 477 00:21:58,600 --> 00:22:01,560 Speaker 2: Wizard of Oz making these decisions about behind some sort 478 00:22:01,560 --> 00:22:04,200 Speaker 2: of curtain about which of these companies qualify for their 479 00:22:04,240 --> 00:22:06,639 Speaker 2: funds and which ones don't. And until we get more 480 00:22:06,680 --> 00:22:09,040 Speaker 2: clarity on that, and until I don't know, it seems 481 00:22:09,040 --> 00:22:11,600 Speaker 2: like the funds that actually the companies that actually get 482 00:22:11,640 --> 00:22:15,000 Speaker 2: included in some of those funds are companies that are 483 00:22:15,000 --> 00:22:17,840 Speaker 2: doing more good. And even then it might not be 484 00:22:18,040 --> 00:22:22,199 Speaker 2: in people's best interest as intand from financially, like they 485 00:22:22,240 --> 00:22:24,919 Speaker 2: might be checking all the boxes from from an ESG standpoint, 486 00:22:25,040 --> 00:22:27,960 Speaker 2: like maybe Philip Morris doesn't get to did they not 487 00:22:28,040 --> 00:22:29,840 Speaker 2: change their name to Atria or whatever? 488 00:22:30,080 --> 00:22:30,720 Speaker 1: That might be cree you. 489 00:22:30,920 --> 00:22:33,639 Speaker 2: I don't know, but regardless, I would say good for 490 00:22:33,680 --> 00:22:35,720 Speaker 2: them because somehow they were able to kind of green 491 00:22:35,840 --> 00:22:40,040 Speaker 2: wash their way onto one of these funds. And unfortunately, 492 00:22:40,040 --> 00:22:41,879 Speaker 2: that's what it seems like a lot of these companies 493 00:22:41,920 --> 00:22:42,399 Speaker 2: are trying to do. 494 00:22:42,520 --> 00:22:45,040 Speaker 1: Yeah, So when we're talking about complicating your investments. There's 495 00:22:45,080 --> 00:22:47,359 Speaker 1: some things that might be worth it. Maybe you're saying, oh, 496 00:22:47,400 --> 00:22:49,680 Speaker 1: the international stocks thing, that makes sense, and over time, 497 00:22:49,760 --> 00:22:51,600 Speaker 1: I do think I want a little more exposure there, 498 00:22:51,760 --> 00:22:54,440 Speaker 1: But on the ESG front, I don't think there's really 499 00:22:54,880 --> 00:22:58,359 Speaker 1: any reason to complicate things further and basically sign yourself 500 00:22:58,400 --> 00:23:00,760 Speaker 1: up for higher fees by stocking more of your money 501 00:23:01,000 --> 00:23:04,680 Speaker 1: into these ESG style index funds. And let's talk about 502 00:23:04,680 --> 00:23:08,639 Speaker 1: something else that people might do to complicate their investing strategy, 503 00:23:08,680 --> 00:23:11,399 Speaker 1: and that would be to incorporate more real estate into 504 00:23:11,680 --> 00:23:16,160 Speaker 1: their investing plan. And that's certainly a more complicated form 505 00:23:16,200 --> 00:23:19,199 Speaker 1: of investing that you know, we get asked about fairly regularly, 506 00:23:19,280 --> 00:23:22,399 Speaker 1: especially because you and I we are real estate investors. 507 00:23:22,440 --> 00:23:24,639 Speaker 1: We're popular estate investors. We each own a handful of 508 00:23:24,680 --> 00:23:27,960 Speaker 1: properties in the Atlanta area. And the thing is we're 509 00:23:28,000 --> 00:23:30,240 Speaker 1: kind of mostly talking about the passive style investing on 510 00:23:30,280 --> 00:23:32,359 Speaker 1: this episode, and you and I we think of real 511 00:23:32,440 --> 00:23:35,120 Speaker 1: estate investing is more like taking on a part time job, 512 00:23:35,320 --> 00:23:38,679 Speaker 1: because it kind of is right not only in the 513 00:23:38,840 --> 00:23:41,600 Speaker 1: identifying and purchasing of that property, but in the managing 514 00:23:41,600 --> 00:23:43,439 Speaker 1: of that property too. And so if you're not up 515 00:23:43,440 --> 00:23:46,280 Speaker 1: for that. If you're not up for all of the 516 00:23:46,359 --> 00:23:48,359 Speaker 1: extra work that it's going to take to own and 517 00:23:48,400 --> 00:23:51,800 Speaker 1: manage that rental property, the fixes, the calls that you're 518 00:23:51,800 --> 00:23:53,680 Speaker 1: going to have to get from the tenant, the things 519 00:23:53,720 --> 00:23:55,280 Speaker 1: you're going to have to do to keep up with 520 00:23:55,320 --> 00:23:59,120 Speaker 1: that property, you should avoid becoming a landlord. And you know, 521 00:23:59,280 --> 00:24:00,920 Speaker 1: like I said this, so we're mostly talking about the 522 00:24:00,960 --> 00:24:03,560 Speaker 1: simple forms of investing that most people are doing with 523 00:24:03,640 --> 00:24:07,480 Speaker 1: every paycheck. So buying real estate is just this other 524 00:24:07,560 --> 00:24:09,359 Speaker 1: ball of wax all together. It's not a bad one. 525 00:24:09,400 --> 00:24:11,399 Speaker 1: It's not something we would necessarily steer people away from. 526 00:24:11,440 --> 00:24:13,080 Speaker 1: And in fact, we've done episodes in the past. We'll 527 00:24:13,119 --> 00:24:14,600 Speaker 1: link to one or two in the show notes if 528 00:24:14,600 --> 00:24:16,800 Speaker 1: you want about investing in real estate and how it 529 00:24:16,840 --> 00:24:20,040 Speaker 1: can be a powerful wealth builder. We're happy real estate 530 00:24:20,080 --> 00:24:22,880 Speaker 1: investors ourselves. But the truth is there are other more 531 00:24:22,920 --> 00:24:25,560 Speaker 1: passive ways to invest in real estate besides buying a 532 00:24:25,600 --> 00:24:27,400 Speaker 1: duplex down the street in the town where you live 533 00:24:27,480 --> 00:24:29,800 Speaker 1: or whatever. And so if you do want to add 534 00:24:29,840 --> 00:24:33,320 Speaker 1: real estate exposure to your investments and you don't want 535 00:24:33,320 --> 00:24:35,600 Speaker 1: to go with the part time job route, Matt, do 536 00:24:35,600 --> 00:24:37,000 Speaker 1: you want to talk about maybe kind of some other 537 00:24:37,000 --> 00:24:37,560 Speaker 1: ways to do that. 538 00:24:37,720 --> 00:24:40,680 Speaker 2: You can do that by investing in rates. So that's 539 00:24:40,680 --> 00:24:42,720 Speaker 2: how you say it, but it stands for real estate 540 00:24:42,920 --> 00:24:46,360 Speaker 2: investment trusts, and so there are the public rates, there 541 00:24:46,359 --> 00:24:49,320 Speaker 2: are private rates, and so we're not completely against the 542 00:24:49,320 --> 00:24:52,840 Speaker 2: private ones, but they do come with higher fees unless liquidity. 543 00:24:52,880 --> 00:24:55,080 Speaker 2: Oftentimes your money is locked up for years at a time. 544 00:24:55,359 --> 00:24:58,520 Speaker 2: So because of that we avoid them ourselves. But even 545 00:24:58,600 --> 00:25:00,760 Speaker 2: publicly trader reads they're kind of cool. They can give 546 00:25:00,800 --> 00:25:03,320 Speaker 2: you some diverse exposure to real estate that you can 547 00:25:03,359 --> 00:25:06,480 Speaker 2: easily dollar cost average into. You don't have to plunk 548 00:25:06,520 --> 00:25:08,800 Speaker 2: down a large amount of cash, like twenty five thousand 549 00:25:08,840 --> 00:25:12,360 Speaker 2: dollars is oftentimes sort of like the minimum amount required 550 00:25:12,400 --> 00:25:14,040 Speaker 2: to go to some of these private routs. 551 00:25:14,160 --> 00:25:16,239 Speaker 1: During like a cocktail hang or something, you can tell people, oh, 552 00:25:16,240 --> 00:25:17,840 Speaker 1: I own apartment building in New York City, or I 553 00:25:17,880 --> 00:25:20,920 Speaker 1: own this with that because you have like this small 554 00:25:21,440 --> 00:25:23,639 Speaker 1: small sliver, but you do I've investment in that project, 555 00:25:23,760 --> 00:25:24,840 Speaker 1: Like yeah, I own some. 556 00:25:24,840 --> 00:25:28,960 Speaker 2: Of Tesla because I own right Boo. But some of 557 00:25:29,000 --> 00:25:32,640 Speaker 2: the other reut funds, like Vanguard's V and Q, they 558 00:25:32,800 --> 00:25:36,920 Speaker 2: are attractive because they're incredibly low cost, but still even 559 00:25:36,960 --> 00:25:40,400 Speaker 2: still most folks. They don't need real estate exposure because 560 00:25:40,440 --> 00:25:43,160 Speaker 2: the average American homeowner, they have most of their net 561 00:25:43,160 --> 00:25:46,160 Speaker 2: worth tied up in their home, in their primary residence. 562 00:25:46,160 --> 00:25:48,960 Speaker 2: And guess what last I checked, that's real estate. Yeah, 563 00:25:49,000 --> 00:25:50,720 Speaker 2: and so we would rather see that kind of person 564 00:25:50,920 --> 00:25:54,159 Speaker 2: more focused on investing within stocks via index funds. And 565 00:25:54,200 --> 00:25:56,959 Speaker 2: even if you don't own your own home, and you're like, well, 566 00:25:56,960 --> 00:25:59,520 Speaker 2: maybe I should be investing within a read. I don't 567 00:25:59,520 --> 00:26:02,480 Speaker 2: own my my own property. Reads, they actually make up 568 00:26:02,520 --> 00:26:05,320 Speaker 2: about five percent of the total stock market. And so 569 00:26:05,760 --> 00:26:08,200 Speaker 2: guess what, if you own a total stock market index fund, 570 00:26:08,240 --> 00:26:10,639 Speaker 2: you're probably invested in a reate. But boom, you just 571 00:26:10,640 --> 00:26:11,720 Speaker 2: didn't even even realize it. 572 00:26:11,760 --> 00:26:13,440 Speaker 1: Yeah, have you own real estate? 573 00:26:13,480 --> 00:26:14,000 Speaker 2: You didn't know it? 574 00:26:14,080 --> 00:26:16,680 Speaker 1: Yeah, that's right. Even if you're a renter, you own 575 00:26:16,760 --> 00:26:22,120 Speaker 1: some real estate via your other investments. And we hung 576 00:26:22,160 --> 00:26:24,680 Speaker 1: out with somebody recently and he was asking about investing 577 00:26:24,680 --> 00:26:27,879 Speaker 1: in real estate or passive income, and of course we 578 00:26:27,960 --> 00:26:30,240 Speaker 1: try to dispel the myth that passive income is super 579 00:26:30,280 --> 00:26:33,280 Speaker 1: easy to come by, but we even told it, yeah, hey, 580 00:26:33,280 --> 00:26:35,040 Speaker 1: investing in real estate might make sense for you. And 581 00:26:35,080 --> 00:26:37,040 Speaker 1: we're try to go through all the nitty gritty and 582 00:26:37,040 --> 00:26:39,679 Speaker 1: all the details, but it's a harder thing for most 583 00:26:39,720 --> 00:26:41,280 Speaker 1: people to accomplish. You have to save up a ton 584 00:26:41,320 --> 00:26:43,359 Speaker 1: of money, and then numbers don't always make sense, and 585 00:26:43,359 --> 00:26:46,240 Speaker 1: they make sense a lot less in today's environment than 586 00:26:46,240 --> 00:26:48,680 Speaker 1: they have than they did years ago. So it's it's 587 00:26:48,680 --> 00:26:50,480 Speaker 1: harder for people to get into the real estate game. 588 00:26:50,800 --> 00:26:53,080 Speaker 1: But that brings up like one other I guess way 589 00:26:53,080 --> 00:26:55,600 Speaker 1: that you can invest in real estate, and that is 590 00:26:55,600 --> 00:27:00,280 Speaker 1: syndication funds and indication deals. Yeah, so those are interesting too, 591 00:27:00,400 --> 00:27:04,640 Speaker 1: they're sexy, well they're yeah, I think they get some press, 592 00:27:04,720 --> 00:27:07,080 Speaker 1: especially on Instagram. I follow some real estate investors and 593 00:27:07,080 --> 00:27:09,800 Speaker 1: they're talking about syndication deals all the time. But there 594 00:27:09,840 --> 00:27:12,560 Speaker 1: are good syndication deals, a bad syndication deals, and all 595 00:27:12,600 --> 00:27:15,960 Speaker 1: the final realick. They're basically like, just imagine someone buying 596 00:27:15,960 --> 00:27:18,000 Speaker 1: an apartment complex. Well, it's truly hard to do on 597 00:27:18,000 --> 00:27:19,480 Speaker 1: your own. So you get a group of investors to 598 00:27:19,480 --> 00:27:21,919 Speaker 1: pool their money together to buy this apartment complex and 599 00:27:21,960 --> 00:27:25,359 Speaker 1: then you start, you know, paying all the investors out 600 00:27:25,840 --> 00:27:28,880 Speaker 1: as you profit from that apartment complex doing well. And 601 00:27:29,119 --> 00:27:31,920 Speaker 1: so the thing is, typically you have to have big 602 00:27:31,960 --> 00:27:33,280 Speaker 1: money to get in the game, and you have to 603 00:27:33,320 --> 00:27:36,000 Speaker 1: be an accredited investor, which means a net worth of 604 00:27:36,040 --> 00:27:38,520 Speaker 1: a million dollars or I think an annual income of 605 00:27:38,560 --> 00:27:40,200 Speaker 1: like two hundred and fifty k or something like that. 606 00:27:40,359 --> 00:27:42,480 Speaker 1: So it's hard to even qualify for that much less 607 00:27:42,520 --> 00:27:44,840 Speaker 1: save up the fifty k that it would take to 608 00:27:44,840 --> 00:27:48,080 Speaker 1: get in on that one syndication deal. And most people 609 00:27:48,359 --> 00:27:51,680 Speaker 1: over complicating their lives and they're probably getting to real 610 00:27:51,800 --> 00:27:55,560 Speaker 1: estate heavy in with their investments by partaking in a 611 00:27:55,600 --> 00:27:59,120 Speaker 1: syndication deal. That's unless they have been like maxing out 612 00:27:59,119 --> 00:28:02,119 Speaker 1: those retirement accounts for years and years and years and 613 00:28:02,160 --> 00:28:04,280 Speaker 1: still they've got extra money and they just really want 614 00:28:04,280 --> 00:28:05,959 Speaker 1: to go down this hole. There's also a lot of 615 00:28:06,600 --> 00:28:09,840 Speaker 1: pitfalls investing in the syndication route. We are already seeing 616 00:28:09,880 --> 00:28:12,840 Speaker 1: some of these syndications go bust, a lot of investors 617 00:28:12,840 --> 00:28:16,480 Speaker 1: losing all their money. That doesn't happen in the stock 618 00:28:16,520 --> 00:28:17,720 Speaker 1: market nearly to the same degree. 619 00:28:17,800 --> 00:28:19,480 Speaker 2: That's right, Yeah, I think a lot of folks just 620 00:28:19,520 --> 00:28:21,520 Speaker 2: they just want to be able to refer to themselves 621 00:28:21,600 --> 00:28:25,439 Speaker 2: as syndicates because that has a nice ring to it 622 00:28:25,480 --> 00:28:27,720 Speaker 2: as well. But that is one way that folks could 623 00:28:27,720 --> 00:28:31,720 Speaker 2: potentially overcomplicate their investing lies. But how do you, untie, 624 00:28:31,720 --> 00:28:35,040 Speaker 2: that knot. What is the simplest and easiest way for 625 00:28:35,080 --> 00:28:37,199 Speaker 2: you to invest for your future? We will get to 626 00:28:37,240 --> 00:28:38,240 Speaker 2: that right after this. 627 00:28:47,880 --> 00:28:51,160 Speaker 1: All right, Matt, let's keep talking about simple investing in 628 00:28:51,200 --> 00:28:54,080 Speaker 1: some of the ways, maybe we try to complicate those investments, 629 00:28:54,680 --> 00:28:57,440 Speaker 1: some of which might make sense, in others which don't 630 00:28:57,440 --> 00:28:59,560 Speaker 1: make any sense at all. And I don't know. It 631 00:28:59,560 --> 00:29:01,160 Speaker 1: makes me think about the game of life. You remember 632 00:29:01,160 --> 00:29:02,680 Speaker 1: that game back in the day, you spin the wheel. 633 00:29:03,000 --> 00:29:05,320 Speaker 1: You'd like never owned it, but I remember playing it, okay, 634 00:29:05,520 --> 00:29:08,200 Speaker 1: And like you got a different job which had a 635 00:29:08,240 --> 00:29:10,520 Speaker 1: different salary, You maybe had a family, or maybe you 636 00:29:10,560 --> 00:29:12,480 Speaker 1: stayed a bachelor. I mean, there's all these different choices 637 00:29:12,480 --> 00:29:13,760 Speaker 1: you make along the way. It's like the. 638 00:29:13,640 --> 00:29:14,560 Speaker 2: American rat race. 639 00:29:14,960 --> 00:29:16,480 Speaker 1: Yeah, exactly, it's. 640 00:29:16,320 --> 00:29:18,200 Speaker 2: The negative way to see it. 641 00:29:18,320 --> 00:29:20,480 Speaker 1: Yeah, well, but there were so many different options. And 642 00:29:20,520 --> 00:29:22,080 Speaker 1: the same thing is true in the world investing, Like 643 00:29:22,080 --> 00:29:24,080 Speaker 1: you can go down a bunch of different paths. Which 644 00:29:24,080 --> 00:29:26,680 Speaker 1: one makes sense for you might depend on and largely 645 00:29:26,680 --> 00:29:29,920 Speaker 1: does depend on individual circumstances. But I think even still, 646 00:29:30,000 --> 00:29:31,880 Speaker 1: there's a lot of broad based advice that we can give. 647 00:29:32,160 --> 00:29:36,280 Speaker 1: Simplicity is typically in the investing world, a better way 648 00:29:36,280 --> 00:29:38,160 Speaker 1: to go. And it just makes me think of like 649 00:29:38,200 --> 00:29:41,880 Speaker 1: all these super niche platforms that exist now, Like you 650 00:29:41,880 --> 00:29:44,360 Speaker 1: can invest in farmland, you can invest in wine, you 651 00:29:44,360 --> 00:29:47,400 Speaker 1: can invest in whiskey, you can invest in crypto NFTs, 652 00:29:47,640 --> 00:29:49,560 Speaker 1: and I mean think about how the n FT's done 653 00:29:49,960 --> 00:29:52,360 Speaker 1: over the past eight to twelve months. I mean, I 654 00:29:52,360 --> 00:29:55,440 Speaker 1: think that first tweet of Jack Dorsey's went for mega dollars, 655 00:29:55,440 --> 00:29:57,920 Speaker 1: and now the guy can't even resell it, right, and 656 00:29:58,000 --> 00:30:00,240 Speaker 1: so I think he did resell it, but for a 657 00:30:00,240 --> 00:30:02,280 Speaker 1: whole lot less. Yeah, for like pennies on the dollar. 658 00:30:02,360 --> 00:30:05,840 Speaker 2: Yeah, unfortunately lost a lot or fortunately because like if 659 00:30:06,640 --> 00:30:08,920 Speaker 2: what we would not have wanted was for things to 660 00:30:08,960 --> 00:30:11,120 Speaker 2: continue to spiral out of control and continue to but 661 00:30:11,200 --> 00:30:11,480 Speaker 2: for that. 662 00:30:11,440 --> 00:30:14,680 Speaker 1: Person, for them, yes exactly. But like conveniently we're hearing 663 00:30:14,720 --> 00:30:17,880 Speaker 1: nothing nothing about some of those categories these days. But 664 00:30:18,680 --> 00:30:20,520 Speaker 1: we actually did a deep dive of some of those 665 00:30:20,520 --> 00:30:23,480 Speaker 1: different online investing platforms back in episode four forty six, 666 00:30:23,480 --> 00:30:25,000 Speaker 1: if you want to go back and listen, and we 667 00:30:25,200 --> 00:30:28,600 Speaker 1: kind of covered the fees but also the returns that 668 00:30:28,840 --> 00:30:31,000 Speaker 1: you're likely to get on some of those things, and 669 00:30:31,000 --> 00:30:34,760 Speaker 1: and uh, yeah, for most folks, all of these more vibrant. 670 00:30:34,800 --> 00:30:37,080 Speaker 1: I'll say ways of investing your money. They're just a 671 00:30:37,120 --> 00:30:40,120 Speaker 1: massive distraction from the tried and true investing methods, that's right. 672 00:30:40,200 --> 00:30:42,680 Speaker 2: Yeah, if you're not maxing out your roth IRA, if 673 00:30:42,680 --> 00:30:46,080 Speaker 2: you're not maxing your four to ohine k socking away 674 00:30:46,080 --> 00:30:50,040 Speaker 2: basically thirty thousand dollars annually into index funds within those 675 00:30:50,040 --> 00:30:52,520 Speaker 2: tax advantage accounts, then you shouldn't even be considering any 676 00:30:52,560 --> 00:30:56,400 Speaker 2: of these alternative platforms where you can invest in whiskey 677 00:30:56,520 --> 00:30:57,040 Speaker 2: or wine. 678 00:30:57,760 --> 00:30:59,120 Speaker 1: Like we were just talking about real estate, and I 679 00:30:59,120 --> 00:31:00,880 Speaker 1: think that that's the first thing I would push back 680 00:31:00,880 --> 00:31:02,480 Speaker 1: on somebody who's looking to do that. I would say, 681 00:31:02,560 --> 00:31:04,720 Speaker 1: have you done all the border the low hanging fruit 682 00:31:05,040 --> 00:31:08,239 Speaker 1: of those two accounts? Are you crushing it there? If so, 683 00:31:08,360 --> 00:31:10,600 Speaker 1: we can talk about next steps. But if not, like 684 00:31:10,640 --> 00:31:12,240 Speaker 1: real estate probably shouldn't be a consideration. 685 00:31:12,320 --> 00:31:13,920 Speaker 2: Sure, yeah, I mean, if you've got money left over 686 00:31:14,160 --> 00:31:16,000 Speaker 2: and you just love the novelty of it, then like 687 00:31:16,040 --> 00:31:17,560 Speaker 2: it's not the worst thing in the world that you 688 00:31:17,600 --> 00:31:20,280 Speaker 2: could dip your toes into. But most people who are 689 00:31:20,320 --> 00:31:22,960 Speaker 2: investing in some of these random ways that have popped 690 00:31:23,040 --> 00:31:27,080 Speaker 2: up in the past few years, they're just reducing their 691 00:31:27,200 --> 00:31:29,840 Speaker 2: meat and potatoes style investing, and that's what we are 692 00:31:29,880 --> 00:31:31,560 Speaker 2: trying to make sure that folks aren't taking care of 693 00:31:31,560 --> 00:31:34,479 Speaker 2: first in order to funnel dollars into this direction. That's 694 00:31:34,520 --> 00:31:36,760 Speaker 2: what we don't don't want folks to do. They're getting 695 00:31:36,760 --> 00:31:41,760 Speaker 2: distracted from the like the bigger prize, and honestly, like 696 00:31:41,800 --> 00:31:43,080 Speaker 2: this is to point out that most of the things 697 00:31:43,080 --> 00:31:47,240 Speaker 2: that we've talked about aren't necessarily inherently bad investments, except 698 00:31:47,240 --> 00:31:49,719 Speaker 2: for like crypto and NFTs, But like some of these 699 00:31:49,720 --> 00:31:52,840 Speaker 2: other platforms, there's still investments. It's not like they're MLMs 700 00:31:52,920 --> 00:31:55,120 Speaker 2: or anything like that where you're totally going to get scammed. 701 00:31:55,360 --> 00:31:58,880 Speaker 2: It's just that there are other priorities that we want 702 00:31:58,920 --> 00:32:01,400 Speaker 2: you to focus on first. If the alternative is to 703 00:32:01,640 --> 00:32:05,520 Speaker 2: mindlessly blow that money, is to mindlessly consume, then I 704 00:32:05,600 --> 00:32:08,080 Speaker 2: might even say, okay, well make sure, yeah, maybe you 705 00:32:08,120 --> 00:32:11,000 Speaker 2: should invest in this platform if that's if that keeps 706 00:32:11,000 --> 00:32:14,240 Speaker 2: you from blowing money that you otherwise would have invested, 707 00:32:14,520 --> 00:32:17,240 Speaker 2: I think maybe in that scenario it could actually make sense. 708 00:32:17,240 --> 00:32:18,560 Speaker 2: But we just want to make sure that you are 709 00:32:18,840 --> 00:32:21,400 Speaker 2: eating your veggies, your mean potatoes first before you start 710 00:32:21,480 --> 00:32:22,680 Speaker 2: focusing on. 711 00:32:22,760 --> 00:32:24,880 Speaker 1: The exotic desserts off to the side. I think that's 712 00:32:24,880 --> 00:32:26,240 Speaker 1: a good way of putting it. It's not that these 713 00:32:26,280 --> 00:32:29,720 Speaker 1: things are inherently bad, although maybe NFTs are. But yeah, 714 00:32:29,760 --> 00:32:33,000 Speaker 1: but like and crypto Yeah, yet to be determined. Some 715 00:32:33,040 --> 00:32:36,040 Speaker 1: of these sites, like I don't minded their existence, yeah exactly. 716 00:32:36,080 --> 00:32:38,760 Speaker 1: It's just that they are for investors who are doing 717 00:32:39,080 --> 00:32:42,479 Speaker 1: the right thing with a ton of their income before 718 00:32:42,880 --> 00:32:45,760 Speaker 1: even thinking about crossing the threshold into investing in some 719 00:32:45,840 --> 00:32:48,040 Speaker 1: of the random things you can invest in now online. 720 00:32:48,200 --> 00:32:50,320 Speaker 1: And let's talk about hiring an advisor for a second, man. 721 00:32:50,360 --> 00:32:52,160 Speaker 1: I think that's something that the people might think that 722 00:32:52,240 --> 00:32:55,320 Speaker 1: is either going to help them uncomplicate their finances or 723 00:32:55,400 --> 00:32:57,520 Speaker 1: they think it might bring more complication. But they think 724 00:32:57,560 --> 00:33:00,600 Speaker 1: it might bring some necessary complication their life life. And 725 00:33:01,040 --> 00:33:03,240 Speaker 1: it's not that we think that hiring a human is 726 00:33:03,400 --> 00:33:05,840 Speaker 1: a bad idea, right, that that a financial advisor can't 727 00:33:05,840 --> 00:33:07,520 Speaker 1: stry in the right direction, can't give you good advice. 728 00:33:07,600 --> 00:33:09,800 Speaker 2: We like humans, We like people mostly, it's not all 729 00:33:09,800 --> 00:33:12,200 Speaker 2: about that we're not doubling down. 730 00:33:12,400 --> 00:33:16,720 Speaker 1: Right. If human advisors were less expensive, I think it 731 00:33:16,720 --> 00:33:20,400 Speaker 1: can make sense for more people, but for everyday folks. Again, 732 00:33:20,640 --> 00:33:24,640 Speaker 1: I think the hiring an advisor question that pursuit can 733 00:33:24,680 --> 00:33:27,680 Speaker 1: be a deviation from what they should really be focused 734 00:33:27,680 --> 00:33:30,600 Speaker 1: on and focusing on. If you're barely snagging the match 735 00:33:30,720 --> 00:33:32,680 Speaker 1: in your four to one K, you just don't need 736 00:33:32,680 --> 00:33:35,480 Speaker 1: to spend hundreds or thousands of dollars to get advice 737 00:33:35,920 --> 00:33:38,760 Speaker 1: from a professional. That's something that you can do before 738 00:33:38,760 --> 00:33:41,000 Speaker 1: you talk to a profession right right, It would be 739 00:33:41,000 --> 00:33:43,200 Speaker 1: so much better to funnel that money into those accounts, 740 00:33:43,360 --> 00:33:45,479 Speaker 1: more money into those accounts to grow for your future. 741 00:33:45,760 --> 00:33:48,480 Speaker 1: I think an advisor makes sense for some folks whose 742 00:33:48,480 --> 00:33:52,560 Speaker 1: situation is getting more complicated, but even then, we want 743 00:33:52,560 --> 00:33:55,680 Speaker 1: folks to only consider fee only financial planners. X Y 744 00:33:55,800 --> 00:33:58,280 Speaker 1: Planning Network is probably the best side out there to 745 00:33:58,280 --> 00:34:01,720 Speaker 1: find one of those. But I think people like they 746 00:34:01,760 --> 00:34:03,240 Speaker 1: start to learn about money and they're like, oh, it 747 00:34:03,280 --> 00:34:06,240 Speaker 1: must be time to hire the advisor. I need a guy. Yeah, girl. 748 00:34:06,480 --> 00:34:10,319 Speaker 1: The truth is you probably don't unless you're crushing it. 749 00:34:10,360 --> 00:34:12,160 Speaker 1: You've been crushing it for years on end. Yeah. 750 00:34:12,200 --> 00:34:14,799 Speaker 2: And I would say based on the fact that you 751 00:34:15,080 --> 00:34:16,560 Speaker 2: if you are hearing a say this, that means you're 752 00:34:16,600 --> 00:34:18,960 Speaker 2: listening to the podcast, which means like that tells me 753 00:34:19,040 --> 00:34:20,640 Speaker 2: that I think you are the kind of person who's 754 00:34:20,680 --> 00:34:23,799 Speaker 2: going to proactively take charge of your finances. And I 755 00:34:23,800 --> 00:34:25,560 Speaker 2: think that that's a good thing, because what we don't 756 00:34:25,560 --> 00:34:29,360 Speaker 2: want are folks to just by default thinking like, basically, 757 00:34:29,480 --> 00:34:31,160 Speaker 2: I don't want you to be like me when I 758 00:34:31,239 --> 00:34:33,480 Speaker 2: got my first real job and started earning money. I 759 00:34:33,520 --> 00:34:35,239 Speaker 2: don't know if I've ever actually talked about this, sure 760 00:34:35,360 --> 00:34:38,759 Speaker 2: new podcast logan don't be like that. But I went 761 00:34:38,880 --> 00:34:41,200 Speaker 2: down I was like, oh, man, I'm earning real money 762 00:34:41,239 --> 00:34:43,799 Speaker 2: now I'm gonna go talk to this Edward Jones guy. 763 00:34:43,840 --> 00:34:45,840 Speaker 2: And so I walked down to walked out, you know, 764 00:34:45,920 --> 00:34:48,160 Speaker 2: and drove down the street and went in there and 765 00:34:48,160 --> 00:34:50,280 Speaker 2: started talking to him. But even at that point, I realized, 766 00:34:50,840 --> 00:34:54,640 Speaker 2: this seems pretty expensive, and I think I can do 767 00:34:54,719 --> 00:34:57,800 Speaker 2: what you're talking about with without paying you. And I 768 00:34:57,840 --> 00:34:59,520 Speaker 2: actually just looked this up because I was curious what 769 00:34:59,560 --> 00:35:02,160 Speaker 2: it is that they charge on the first two hundred 770 00:35:02,160 --> 00:35:05,800 Speaker 2: and fifty thousand dollars. They charge one point three five percent. Wow, 771 00:35:05,960 --> 00:35:09,400 Speaker 2: that is expensive, man, And especially for somebody who is 772 00:35:09,520 --> 00:35:13,120 Speaker 2: just getting started with their investing, that is not a 773 00:35:13,160 --> 00:35:15,160 Speaker 2: fee that they need to be and they need to 774 00:35:15,200 --> 00:35:18,080 Speaker 2: be paying. But so one of the ways around hiring 775 00:35:18,160 --> 00:35:22,440 Speaker 2: an actual person are is ai it is the all 776 00:35:22,480 --> 00:35:25,600 Speaker 2: the robo advisors out there, and sometimes we say that, 777 00:35:25,640 --> 00:35:27,319 Speaker 2: you know, this is a happy medium for a lot 778 00:35:27,360 --> 00:35:30,200 Speaker 2: of folks, but are those a good choice and what 779 00:35:30,239 --> 00:35:32,799 Speaker 2: would make someone opt to go in that direction. And 780 00:35:32,840 --> 00:35:35,680 Speaker 2: this is the second time we've referenced Monday's episode, but 781 00:35:35,760 --> 00:35:39,840 Speaker 2: we talked about the tax lost harvesting abilities of a 782 00:35:39,920 --> 00:35:42,879 Speaker 2: robo advisor like Betterment, which we would say it's it's 783 00:35:42,880 --> 00:35:44,719 Speaker 2: probably one of the best ones out there. It might 784 00:35:44,760 --> 00:35:47,960 Speaker 2: be the best of the bunch within the robo advising category. 785 00:35:48,280 --> 00:35:51,520 Speaker 2: And this is largely because of the like the behavioral 786 00:35:51,840 --> 00:35:53,960 Speaker 2: finance elements that they've built into the. 787 00:35:53,920 --> 00:35:56,480 Speaker 1: Service where they're able to help folks to stay the course. 788 00:35:56,840 --> 00:35:59,520 Speaker 1: It's not like they offer superior fun choices or anything 789 00:35:59,600 --> 00:36:01,839 Speaker 1: like that. There's no there's no secret sauce, right, It's 790 00:36:01,920 --> 00:36:05,400 Speaker 1: it's those kind of advisory elements that they will they 791 00:36:05,440 --> 00:36:07,799 Speaker 1: help you stay the course, which is really important. That's 792 00:36:07,800 --> 00:36:09,279 Speaker 1: one of the best things an advisor can do. 793 00:36:09,360 --> 00:36:11,280 Speaker 2: Right, Yeah, And well then they actually do have advisors 794 00:36:11,320 --> 00:36:13,480 Speaker 2: and so, like their fees range from like zero point 795 00:36:13,520 --> 00:36:16,640 Speaker 2: two five percent for kind of like their standard digital plan, 796 00:36:16,719 --> 00:36:19,120 Speaker 2: but if you pay a little bit more point four percent, 797 00:36:19,160 --> 00:36:22,880 Speaker 2: which I don't like seeing. But with that premium service, 798 00:36:22,920 --> 00:36:26,879 Speaker 2: you get access to professional financial planners actual cfps, which 799 00:36:26,880 --> 00:36:28,440 Speaker 2: can go a long way when it comes to, you know, 800 00:36:28,440 --> 00:36:29,320 Speaker 2: planning out your finals. 801 00:36:29,400 --> 00:36:30,879 Speaker 1: When you think about when you compare it to something 802 00:36:30,920 --> 00:36:32,520 Speaker 1: like Edward Jones that you just mentioned, that's a. 803 00:36:32,480 --> 00:36:36,400 Speaker 2: Third of the price, saving an entire point. Yeah, for 804 00:36:36,800 --> 00:36:39,040 Speaker 2: one hundred points a full percentage point, it seems like 805 00:36:39,040 --> 00:36:40,680 Speaker 2: it seems like a pretty good deal. What do you 806 00:36:40,680 --> 00:36:43,000 Speaker 2: think about on those terms? Yeah, you're paying a little more, 807 00:36:43,080 --> 00:36:45,799 Speaker 2: certainly for a robo advisor than if you were to 808 00:36:45,960 --> 00:36:49,880 Speaker 2: be doing it yourself, but it's still pretty inexpensive compared 809 00:36:49,920 --> 00:36:53,080 Speaker 2: to hiring a traditional human advisor. And no hate to 810 00:36:53,280 --> 00:36:55,040 Speaker 2: all those Edward Jones folks. 811 00:36:54,840 --> 00:36:59,080 Speaker 1: Out there, Yeah, no, I mean, I'm some people want that. 812 00:36:59,360 --> 00:37:01,640 Speaker 1: I guess, like that's not our jam, and that's not 813 00:37:01,640 --> 00:37:03,560 Speaker 1: what we recommend people. It's a different Yeah, it's a 814 00:37:03,560 --> 00:37:06,000 Speaker 1: different service, and some folks kind of want that assistance. 815 00:37:06,200 --> 00:37:09,000 Speaker 1: They want to sit down in person, you know, going 816 00:37:09,040 --> 00:37:10,880 Speaker 1: through that whole thing. I think if you're going to 817 00:37:10,920 --> 00:37:13,120 Speaker 1: go the robo advisor direction, like I don't know, I 818 00:37:13,120 --> 00:37:15,520 Speaker 1: think Betterments, Yeah, is one of the best and that 819 00:37:15,600 --> 00:37:19,920 Speaker 1: combo of human advice with the kind of robo platform 820 00:37:19,960 --> 00:37:23,040 Speaker 1: helping you on the tax front and on the advice front. 821 00:37:23,120 --> 00:37:25,120 Speaker 1: I think it's pretty cool, and you know, for some 822 00:37:25,239 --> 00:37:27,799 Speaker 1: people it's worth paying the extra money. But let's talk 823 00:37:27,800 --> 00:37:31,399 Speaker 1: about Matt just kind of some guideline, some basics. When 824 00:37:31,440 --> 00:37:36,680 Speaker 1: we talk about simplification of investing and how over complicating things, 825 00:37:37,040 --> 00:37:39,319 Speaker 1: and of course there are a million ways that you 826 00:37:39,400 --> 00:37:42,880 Speaker 1: can complicate your investing strategy, but we really believe that 827 00:37:42,920 --> 00:37:44,480 Speaker 1: it doesn't need to be. It shouldn't have to be, 828 00:37:44,680 --> 00:37:47,680 Speaker 1: and it shouldn't be terribly complicated. And I think the 829 00:37:48,280 --> 00:37:51,600 Speaker 1: more complicated you make it, the less likely people are 830 00:37:51,640 --> 00:37:54,480 Speaker 1: to partake in that action. Right when you say there's 831 00:37:54,520 --> 00:37:56,840 Speaker 1: ten hoops to jump through, people are going to just 832 00:37:56,960 --> 00:37:59,840 Speaker 1: walk away before they start. When the belief is that 833 00:38:00,040 --> 00:38:02,279 Speaker 1: investing is hard, a lot of folks decide to skip 834 00:38:02,320 --> 00:38:06,160 Speaker 1: out altogether. And so that does so much more harm 835 00:38:06,280 --> 00:38:09,240 Speaker 1: than maybe not having quite enough international exposure or missing 836 00:38:09,320 --> 00:38:11,759 Speaker 1: out on some years where real estate had super good 837 00:38:11,800 --> 00:38:14,799 Speaker 1: return something like that. Doing the thing, even doing it 838 00:38:14,840 --> 00:38:18,319 Speaker 1: imperfectly and doing it regularly is the key. It comes 839 00:38:18,360 --> 00:38:20,359 Speaker 1: down to. The crux of the matter is don't let 840 00:38:20,640 --> 00:38:22,640 Speaker 1: perfect be the enemy of good if you're trying to 841 00:38:23,120 --> 00:38:24,600 Speaker 1: you're just starting out, and you're like, I want to 842 00:38:24,640 --> 00:38:29,040 Speaker 1: invest the exact right way, the perfect way for future returns, 843 00:38:29,080 --> 00:38:31,520 Speaker 1: and the perfect way so that I stay the course. 844 00:38:31,600 --> 00:38:34,120 Speaker 1: I mean, I think my advice would be get started 845 00:38:34,160 --> 00:38:36,719 Speaker 1: and then continue learning, and you can iterate over time 846 00:38:36,760 --> 00:38:40,320 Speaker 1: if you want. But simplicity is better than perfection. 847 00:38:40,760 --> 00:38:43,000 Speaker 2: So this kind of makes me think of why I 848 00:38:43,040 --> 00:38:45,839 Speaker 2: don't necessarily like talking about my budget in the fact 849 00:38:45,880 --> 00:38:47,759 Speaker 2: that we've made it available, which I guess I'm doing 850 00:38:47,800 --> 00:38:50,600 Speaker 2: that by even sharing this example. But the reason I 851 00:38:50,600 --> 00:38:52,400 Speaker 2: don't necessarily like pushing it out there for folks is 852 00:38:52,400 --> 00:38:54,000 Speaker 2: because it's too complicated. 853 00:38:54,040 --> 00:38:54,720 Speaker 1: For most folks. 854 00:38:54,760 --> 00:38:58,040 Speaker 2: It's not something that, especially if you've never budgeted before, 855 00:38:58,600 --> 00:39:01,520 Speaker 2: this shouldn't be your first step towards tracking your expenses 856 00:39:01,560 --> 00:39:04,720 Speaker 2: and budgeting for the month. And so, in a similar way, 857 00:39:05,200 --> 00:39:08,759 Speaker 2: we want folks to be successful rather than you know, 858 00:39:08,840 --> 00:39:11,160 Speaker 2: having all the i's dotted, all the tea's crossing, and 859 00:39:11,200 --> 00:39:13,560 Speaker 2: have anything's perfect, where you end up kind of, you know, 860 00:39:13,640 --> 00:39:16,200 Speaker 2: falling off the wagon. And so we want folks to 861 00:39:16,239 --> 00:39:19,000 Speaker 2: opt for what we would call a minimalist portfolio. We've 862 00:39:19,000 --> 00:39:21,200 Speaker 2: always said that a total stock market or at S 863 00:39:21,200 --> 00:39:23,799 Speaker 2: and P five hundred fund it gets folks who are 864 00:39:23,800 --> 00:39:26,200 Speaker 2: in the wealth building phase of their lives basically what 865 00:39:26,239 --> 00:39:30,040 Speaker 2: it is that they need without overthinking it. And target 866 00:39:30,120 --> 00:39:32,800 Speaker 2: date funds they are another great set it and forget 867 00:39:32,800 --> 00:39:36,239 Speaker 2: it approach for money that you're stalking away inside of 868 00:39:36,280 --> 00:39:39,440 Speaker 2: your retirement accounts. And so it's not that you can't 869 00:39:39,680 --> 00:39:42,200 Speaker 2: diversify further, you know, if you wanted to say, add 870 00:39:42,280 --> 00:39:45,560 Speaker 2: some a little more real estate exposure via a rate, 871 00:39:45,880 --> 00:39:47,279 Speaker 2: If you want to do that, that's great, you do you. 872 00:39:47,600 --> 00:39:51,440 Speaker 2: It's just that the minimalist route, investing within a single 873 00:39:51,480 --> 00:39:55,000 Speaker 2: fund or maybe two that are already well diversified, this 874 00:39:55,120 --> 00:39:57,319 Speaker 2: is an effective strategy that will get you where it 875 00:39:57,360 --> 00:39:59,279 Speaker 2: is that you want to be. Yeah, man, I love that. 876 00:40:00,120 --> 00:40:03,200 Speaker 2: Like the idea of just keeping it as simple as possible, 877 00:40:03,280 --> 00:40:06,239 Speaker 2: keeping it minimalist, and then doing the right thing over 878 00:40:06,280 --> 00:40:08,640 Speaker 2: and over right. So the next thing would we've mentioned 879 00:40:08,719 --> 00:40:11,000 Speaker 2: is to have that plan and then stick to it, 880 00:40:11,080 --> 00:40:13,160 Speaker 2: because the best plan is something that you can stick to, 881 00:40:13,560 --> 00:40:18,000 Speaker 2: and it's it's easy to make complicated plans and then 882 00:40:18,080 --> 00:40:20,080 Speaker 2: it but it's easier to break those plans too, right, 883 00:40:20,680 --> 00:40:23,000 Speaker 2: because you're like, wait a second, I got to step three. 884 00:40:23,120 --> 00:40:26,359 Speaker 2: There's thirty more steps. I'm just gonna bow out right now. 885 00:40:26,640 --> 00:40:28,960 Speaker 2: And that's what makes like, it makes me think of 886 00:40:28,960 --> 00:40:31,439 Speaker 2: the app Couch to five K. Heard someone talking about 887 00:40:31,480 --> 00:40:35,080 Speaker 2: that recently and how it changed their life. They were 888 00:40:35,400 --> 00:40:38,880 Speaker 2: nervous to start running. But with that app, it's specifically 889 00:40:38,880 --> 00:40:40,839 Speaker 2: it like slowly changes the amount of time where you're 890 00:40:40,920 --> 00:40:43,759 Speaker 2: running and walking so that you don't feel overwhelmed. After 891 00:40:43,880 --> 00:40:45,920 Speaker 2: two days of You're like, if you try to go 892 00:40:46,040 --> 00:40:49,120 Speaker 2: run a five k and you've been like, haveing run 893 00:40:49,200 --> 00:40:52,600 Speaker 2: at all in years, good luck, Right, you're probably gonna 894 00:40:52,600 --> 00:40:54,520 Speaker 2: get demoralized. But if you take this couch to five 895 00:40:54,560 --> 00:40:56,000 Speaker 2: k route and you try to build up over I 896 00:40:56,040 --> 00:40:58,040 Speaker 2: don't know the course of something like three months, you 897 00:40:58,120 --> 00:41:00,960 Speaker 2: are in all likelihood gone run an awesome five k 898 00:41:01,440 --> 00:41:03,520 Speaker 2: a recipe for success. Heck, you might even keep going 899 00:41:03,560 --> 00:41:04,759 Speaker 2: go ten k pretty soon. Right. 900 00:41:05,280 --> 00:41:07,920 Speaker 1: But yeah, So the same is true with your investments. 901 00:41:07,920 --> 00:41:11,400 Speaker 1: The most important thing is shoveling money into those retirement accounts, 902 00:41:11,400 --> 00:41:15,640 Speaker 1: consistently getting those dollars invested in a diversified manner. So 903 00:41:15,800 --> 00:41:17,880 Speaker 1: come up with the plan and hopefully that plan is 904 00:41:18,360 --> 00:41:21,360 Speaker 1: minimalist in nature, and then stick to it, do it regularly, 905 00:41:21,400 --> 00:41:24,359 Speaker 1: do it religiously. That's where dollar cost averaging comes in, right. 906 00:41:24,400 --> 00:41:26,600 Speaker 1: If you just kind of keep doing it with every paycheck, 907 00:41:27,000 --> 00:41:30,440 Speaker 1: then without overthinking, without overthinking it, you're going to be ahead, 908 00:41:30,560 --> 00:41:33,400 Speaker 1: vastly ahead of the majority of your peers on the 909 00:41:33,440 --> 00:41:35,880 Speaker 1: investing front. Yeah, and so you said kind of shoveling 910 00:41:35,920 --> 00:41:37,799 Speaker 1: money into those accounts, which makes me think of the 911 00:41:37,840 --> 00:41:41,480 Speaker 1: fact that especially early on, when you are just getting 912 00:41:41,480 --> 00:41:44,040 Speaker 1: started with your investing, when you see fluctuations in the market, 913 00:41:44,040 --> 00:41:46,920 Speaker 1: and especially like we've seen over the past several weeks 914 00:41:47,000 --> 00:41:50,640 Speaker 1: we've seen a booming market, if you are just getting 915 00:41:50,640 --> 00:41:53,000 Speaker 1: started with your investments, you're not going to see much 916 00:41:53,080 --> 00:41:56,080 Speaker 1: change when it comes to the size of your portfolio 917 00:41:56,120 --> 00:41:59,080 Speaker 1: because you're just getting started. Truly, what has the biggest impact, 918 00:41:59,120 --> 00:42:00,760 Speaker 1: what moves the needle of the most is your savings 919 00:42:00,840 --> 00:42:03,120 Speaker 1: rate and how much money you are able to sock 920 00:42:03,160 --> 00:42:05,160 Speaker 1: away versus. 921 00:42:05,640 --> 00:42:08,200 Speaker 2: Like we've been investing for like ten fifteen, coming up 922 00:42:08,239 --> 00:42:11,359 Speaker 2: on twenty years, and we've got bigger nest eggs, that's 923 00:42:11,719 --> 00:42:15,399 Speaker 2: bottom line than when we started investing fifteen twenty years ago. 924 00:42:15,840 --> 00:42:18,160 Speaker 2: And now when the market goes up, it's a little 925 00:42:18,200 --> 00:42:20,040 Speaker 2: more fun, right Like, it's a little more fun to 926 00:42:20,040 --> 00:42:21,960 Speaker 2: see the balances increase a little bit when you check 927 00:42:22,000 --> 00:42:24,480 Speaker 2: it at the end of the month. But that would 928 00:42:24,480 --> 00:42:28,800 Speaker 2: not have happened if we weren't sacrificing, cutting back on expenses, 929 00:42:28,840 --> 00:42:32,560 Speaker 2: finding ways to invest more while we were younger. Basically, 930 00:42:32,600 --> 00:42:34,640 Speaker 2: you kind of have to like pay your dues a 931 00:42:34,680 --> 00:42:36,840 Speaker 2: little bit. And once that nest egg gets to be 932 00:42:36,920 --> 00:42:41,000 Speaker 2: a certain size, well market fluctuations and a growing market, 933 00:42:41,200 --> 00:42:42,800 Speaker 2: that's when you get to see the beauty of the 934 00:42:42,840 --> 00:42:47,120 Speaker 2: compound of compounding returns, because compounding returns and interest doesn't 935 00:42:47,200 --> 00:42:50,239 Speaker 2: make a huge dent in those early years. On the 936 00:42:50,280 --> 00:42:51,680 Speaker 2: back end is when you start to see. 937 00:42:51,480 --> 00:42:54,040 Speaker 1: That you can totally split hairs about how much money 938 00:42:54,040 --> 00:42:57,960 Speaker 1: you've got allocated international, how much exposure you have to 939 00:42:58,000 --> 00:43:02,240 Speaker 1: real estate, whether or not you're investing in vintage lines, whatever. 940 00:43:02,320 --> 00:43:04,240 Speaker 1: I mean, you can split hairs over all that stuff, 941 00:43:04,239 --> 00:43:06,359 Speaker 1: and what the exact right percentage is for every single thing. 942 00:43:06,640 --> 00:43:09,239 Speaker 1: Do I need more small cap value in my portfolio? 943 00:43:09,520 --> 00:43:13,040 Speaker 1: Bloody bloody blah. And it's not that those conversations are 944 00:43:13,200 --> 00:43:17,000 Speaker 1: completely worthless, but you're right, like the biggest change that 945 00:43:17,040 --> 00:43:20,120 Speaker 1: we can make most easily that comes with the less 946 00:43:20,160 --> 00:43:22,600 Speaker 1: stress and the most likelihood of follow through is to 947 00:43:22,680 --> 00:43:25,200 Speaker 1: keep it simple and to just ramp up the percentage 948 00:43:25,200 --> 00:43:27,680 Speaker 1: that we're that we're dedicating each and every month, each 949 00:43:27,760 --> 00:43:31,320 Speaker 1: every paycheck to those accounts, Like that is the spigot 950 00:43:31,320 --> 00:43:33,200 Speaker 1: that we can turn on the most that's going to 951 00:43:33,800 --> 00:43:35,960 Speaker 1: lead to the largest growth in nest egg. You can 952 00:43:36,000 --> 00:43:40,160 Speaker 1: try to get that perfect allocation, create the most diverse 953 00:43:40,520 --> 00:43:44,040 Speaker 1: investment account possible, but the reality is then you're probably 954 00:43:44,040 --> 00:43:48,080 Speaker 1: not quite as focused on that more important lever and ultimately, yeah, 955 00:43:48,239 --> 00:43:50,719 Speaker 1: you might have the most diverse portfolio on earth, but 956 00:43:50,800 --> 00:43:54,279 Speaker 1: you're the perfectly diverse Yeah, but you're missing out than 957 00:43:54,680 --> 00:43:56,759 Speaker 1: on the most important thing. It's kind of like, well, 958 00:43:56,800 --> 00:43:59,360 Speaker 1: we talked about back not too long ago with frugality, 959 00:43:59,400 --> 00:44:02,320 Speaker 1: how it has to be wishing returns. Same thing. People. 960 00:44:02,400 --> 00:44:04,440 Speaker 1: If you're so focused on frugality, you're probably not going 961 00:44:04,480 --> 00:44:07,239 Speaker 1: to be as thoughtful about ramping up your income. And 962 00:44:07,280 --> 00:44:08,680 Speaker 1: this is true too. I think the more you think 963 00:44:08,680 --> 00:44:12,400 Speaker 1: about how your portfolio is allocated, boom, you've lost the 964 00:44:12,400 --> 00:44:14,719 Speaker 1: plot and you're focused too much on the little things. 965 00:44:14,719 --> 00:44:16,400 Speaker 1: You're majoring on the miners, that's right. 966 00:44:16,360 --> 00:44:18,719 Speaker 2: Yeah, and then and finally too. I mean, so one 967 00:44:18,719 --> 00:44:21,840 Speaker 2: of the reasons we're talking about this today is because 968 00:44:21,880 --> 00:44:24,280 Speaker 2: of the timeliness of it. Right, So, as the market 969 00:44:24,320 --> 00:44:27,800 Speaker 2: is booming and we've seen some you know, fluctuation recently, 970 00:44:28,239 --> 00:44:30,399 Speaker 2: but folks, it becomes something that folks want to talk 971 00:44:30,400 --> 00:44:32,360 Speaker 2: about more. And what we want to encourage you to 972 00:44:32,400 --> 00:44:33,960 Speaker 2: do is like, once you do have this plan you've 973 00:44:33,960 --> 00:44:35,960 Speaker 2: heard us talk through, Hey, maybe you should just be 974 00:44:35,960 --> 00:44:37,960 Speaker 2: looking at a total stock market index fund or an 975 00:44:38,000 --> 00:44:41,000 Speaker 2: SMP five hundred index fund, or maybe a target date fund. 976 00:44:41,160 --> 00:44:43,600 Speaker 2: Once you have that plan, ignore everything else. We want 977 00:44:43,600 --> 00:44:46,480 Speaker 2: you to put the blinders on. We want you to 978 00:44:46,560 --> 00:44:50,120 Speaker 2: limit the noise, especially when it comes to the different 979 00:44:50,120 --> 00:44:54,040 Speaker 2: headlines that you read. But when the market is tanking, 980 00:44:54,280 --> 00:44:56,680 Speaker 2: folks are like, do you batten down the hatches? 981 00:44:56,760 --> 00:44:56,920 Speaker 1: Right? 982 00:44:57,000 --> 00:44:59,040 Speaker 2: Like you are not interested in taking some of these risks. 983 00:44:59,080 --> 00:45:01,240 Speaker 2: But like you were saying earlier, when things are booming, 984 00:45:01,239 --> 00:45:05,359 Speaker 2: everybody feels brilliant, everybody feels rich, and they're thinking, ah, well, 985 00:45:05,360 --> 00:45:08,279 Speaker 2: what else can I do in order to make this 986 00:45:08,400 --> 00:45:11,680 Speaker 2: ride last even longer? Basically, and we that is the 987 00:45:11,719 --> 00:45:14,440 Speaker 2: opposite of what you actually should be doing, And so 988 00:45:14,480 --> 00:45:16,560 Speaker 2: while everyone else is out there figuring out different ways 989 00:45:16,560 --> 00:45:20,000 Speaker 2: that they can invest in the latest sexy thing like 990 00:45:20,160 --> 00:45:24,960 Speaker 2: and who knows what the next iteration of distracting investment 991 00:45:25,000 --> 00:45:27,040 Speaker 2: opportunities are going to come down the pike, right like 992 00:45:27,200 --> 00:45:30,520 Speaker 2: they'll come they, oh, they absolutely will, but they are 993 00:45:30,520 --> 00:45:32,680 Speaker 2: not things that you need to be paying attention to. 994 00:45:32,800 --> 00:45:34,680 Speaker 2: And so, yeah, we wanted to talk about the different 995 00:45:34,719 --> 00:45:36,680 Speaker 2: ways that you can simplify how it is that you 996 00:45:36,760 --> 00:45:39,399 Speaker 2: invest in. Truly, it does not need to be all 997 00:45:39,440 --> 00:45:40,160 Speaker 2: that complicated. 998 00:45:40,320 --> 00:45:43,799 Speaker 1: Agreed, and simple doesn't mean unsophisticated, right, Simple can still 999 00:45:43,840 --> 00:45:46,880 Speaker 1: be diverse, and it can. It can give you exactly 1000 00:45:46,920 --> 00:45:49,080 Speaker 1: what you need without ever thinking if. 1001 00:45:48,960 --> 00:45:50,399 Speaker 2: You think the S and P five hundred NIX fund 1002 00:45:50,480 --> 00:45:53,080 Speaker 2: or the total stock market in NIX fund is unsophisticated, 1003 00:45:53,320 --> 00:45:56,520 Speaker 2: log into all of the different companies that make up 1004 00:45:56,600 --> 00:46:00,080 Speaker 2: sure that that fund consists of. 1005 00:45:59,800 --> 00:46:02,640 Speaker 1: Back to see and go back and listen maybe to 1006 00:46:02,760 --> 00:46:06,399 Speaker 1: our episode with Robin Wigglesworth about his book Trillions and 1007 00:46:06,440 --> 00:46:10,680 Speaker 1: how Jack Bobol kind of really started the index fund 1008 00:46:10,760 --> 00:46:13,959 Speaker 1: ye movement and it's been a powerful one. So yeah, 1009 00:46:14,320 --> 00:46:16,880 Speaker 1: it's investing is the one thing where the more effort 1010 00:46:16,960 --> 00:46:20,440 Speaker 1: you put in the worst your returns get typically simplicity 1011 00:46:20,520 --> 00:46:21,840 Speaker 1: makes a whole lot of sense. We'll link to that 1012 00:46:22,080 --> 00:46:24,399 Speaker 1: interview as well. Yeah, all right, Matt, let's mention as 1013 00:46:24,400 --> 00:46:25,640 Speaker 1: go back to the beer we had. This one is 1014 00:46:25,680 --> 00:46:29,960 Speaker 1: called Symptom of Progeny. It's a golden sour ale fermented 1015 00:46:29,960 --> 00:46:32,320 Speaker 1: with spontaneous culture. What were your thoughts on this one? 1016 00:46:32,800 --> 00:46:33,400 Speaker 2: I really like it. 1017 00:46:33,440 --> 00:46:35,040 Speaker 1: What do you think about it? I really like guess 1018 00:46:36,320 --> 00:46:39,399 Speaker 1: I say, it's like brightly tart, Chris. I know there's 1019 00:46:39,440 --> 00:46:41,960 Speaker 1: no fruit in this. It's got peach fuzzy elements. Oh yeah, 1020 00:46:42,040 --> 00:46:44,280 Speaker 1: big time, dude. So truly. 1021 00:46:45,120 --> 00:46:47,640 Speaker 2: I was curious because we've been drinking some really big, 1022 00:46:47,719 --> 00:46:51,799 Speaker 2: really sweet stouts from Burial recently, and because of that, 1023 00:46:51,840 --> 00:46:54,560 Speaker 2: this one almost seems like a touch to tart. But 1024 00:46:54,760 --> 00:46:57,360 Speaker 2: I think it's because of all the sweet beers that 1025 00:46:57,360 --> 00:47:00,920 Speaker 2: we've been drinking like this. It's still such a bright, crisp, refreshing, 1026 00:47:01,480 --> 00:47:04,840 Speaker 2: perfectly aged, perfectly oky golden ale. It's exactly what I 1027 00:47:04,840 --> 00:47:06,680 Speaker 2: want out of a golden golden ail. And it's there's 1028 00:47:06,840 --> 00:47:08,520 Speaker 2: I mean, there's a good reason why Kate and I mean, 1029 00:47:08,520 --> 00:47:10,239 Speaker 2: we picked up several bottles of us to bring back 1030 00:47:10,239 --> 00:47:13,000 Speaker 2: home to enjoy, because we certainly enjoyed this one. 1031 00:47:12,800 --> 00:47:14,320 Speaker 1: That it just makes me think Burial does some of 1032 00:47:14,360 --> 00:47:15,680 Speaker 1: the best beers in every genre. 1033 00:47:15,840 --> 00:47:17,480 Speaker 2: Yeah, oh yeah, before we were talking about just how 1034 00:47:17,520 --> 00:47:19,719 Speaker 2: they're crushing it. They crush it with their their New 1035 00:47:19,719 --> 00:47:23,040 Speaker 2: England hazes and obviously there's stouts that we've been enjoying recently. 1036 00:47:23,080 --> 00:47:25,440 Speaker 1: But yes, this is a barely age sour. Do they 1037 00:47:25,440 --> 00:47:26,480 Speaker 1: make bad beers? I don't think so. 1038 00:47:26,800 --> 00:47:29,480 Speaker 2: Not completely knock out of the park. Yeah for sure. 1039 00:47:29,560 --> 00:47:31,160 Speaker 1: All right, that's gonna do it for this episode. You 1040 00:47:31,160 --> 00:47:33,480 Speaker 1: can find links to some of the stuff we mentioned 1041 00:47:33,760 --> 00:47:36,640 Speaker 1: up on the show notes at our website howtomoney dot com, 1042 00:47:36,719 --> 00:47:38,719 Speaker 1: and of course you can sign up for our how 1043 00:47:38,760 --> 00:47:41,759 Speaker 1: to Money newsletter. One came out just yesterday. You missed it, 1044 00:47:41,840 --> 00:47:43,480 Speaker 1: but you'll make the next one if you go sign 1045 00:47:43,560 --> 00:47:46,399 Speaker 1: up at hoda money dot com slash newsletter or. 1046 00:47:46,360 --> 00:47:48,600 Speaker 2: You didn't miss it because you're one of the select few, 1047 00:47:48,640 --> 00:47:49,520 Speaker 2: you're one of the chosen. 1048 00:47:50,280 --> 00:47:51,440 Speaker 1: No, it's growing, it's a growing list. 1049 00:47:51,480 --> 00:47:52,920 Speaker 2: There's a lot of people in there, but we just 1050 00:47:52,960 --> 00:47:55,480 Speaker 2: want we're not selective everybody to get anybody and everybody 1051 00:47:55,520 --> 00:47:56,440 Speaker 2: the free glory that is. 1052 00:47:56,400 --> 00:47:58,719 Speaker 1: The had of Money Newsletter. But that's right man, all right. 1053 00:47:58,719 --> 00:48:00,680 Speaker 2: So that's gonna be it for this one until next time. 1054 00:48:00,840 --> 00:48:03,080 Speaker 2: Best Friends Out, Best Friends Out,