00:00:01
Speaker 1: Welcome to How to Money. I'm Joel and I am Matt. Today we're talking frustrating funflation, money morons and home haters.

00:00:30
Speaker 2: Joel. In the video, I was holding up my shirt. I've got my fun Time vacation shirt on for our Friday flight today. It looks like, well, I like it.

00:00:38
Speaker 1: It makes me think you're going to Fiji after this or something?

00:00:41
Speaker 2: Is that happening? This is like, it's my summertime. I'm a vacation shirt. So it feels a little weird psychologically wearing it right now while we are working. But I realized I only wore once this past summer. This unfortunately, the summer is coming to an end. Man. Yeah, it's like the kids are back in school, so where we are yet? You know school started up this week, we start and lee where we are. Most people are like, uh, we don't start for like three more weeks, guys. Yeah. Is it the labor day? A lot of times folks to get start after labor Day. That's not how they do it down here in this out anyway, Like ten percent of our of our school year in by men. I know. Yeah, I wanted to wear my vacation shirt because it felt like it was appropriate, I guess for today's episode because I wanted to get one more wear in. It's just so soft and it's got palm trees and stuff on it too. This looks good. I like how you'd like that.

00:01:29
Speaker 1: All right, let's we got a bunch of good stuff to get today on today's Friday flight. But I just briefly wanted to respond to a listener email, and I think listener Ali made some great points. You and I had talked about long term disability on an episode that came out a couple of weeks ago, and long term term disability insurance.

00:01:47
Speaker 2: Oh yeah.

00:01:48
Speaker 1: One of the things that you and I had talked about, maybe maybe a little too flippantly, was if you are a brain worker, like if we were, like we're podcasters, Like, what could happen to us that we wouldn't be able to make an income? And the truth is, like if we got taken out of the legs, Matt, like, we could still do this job. But then there are we didn't give enough credence.

00:02:06
Speaker 2: They missed my mouth.

00:02:08
Speaker 1: Right right exactly, But there are things that could happen that would really cause us not to be able to do work in the way that we've been become accustomed to and potentially even like disallow us from podcasting, right, some sort of degenerative disease or some sort of cancer, right, And so Ali pointed that out. I appreciated her pointing out that out. In her email, she talked about her aunt who was like a high powered lawyer and because of a disability like it and not having disability insurance, long term disability insurance in particular, like a completely just a sad ending as her aunt ended up passing away, and just what the impact it had on the family. It made me rethink, like, after our conversation, maybe I think she's right. I think we were just a little too flippant with that. I think more people, even knowledge workers, even brain workers, should should consider having long term disability. It's not just for people like working in the coal mines.

00:03:02
Speaker 2: If people should that, do people still work in the coal mines? I can only picture Derek Zoolander. You know, it made me think of the is it the I'm sure people do one of the Social Security offices where the files are stored literally in an old salt mine. And by the way, this is our Friday flight where we talk about stories, So we actually will get to a social security story later on during the episode. But yes, especially with her, well, I like what she said. She said, it's not a bron versus brain sort of mentality that you should take when it comes to long term disability. And that was an older episode that was the best eat. But I think there's no way that we didn't talk about how folks are like three to four times more likely to become disabled than they are to die during their working career, because those are the stats. And I've got to think we said that. I didn't listen back to that episode all the way to hear whether or not we did, But I do think in her case, she experience got to see a first hand how this wrecked some family members, and you just experience it just feels a bit more real when you experienced it that way. But at the end, I completely empathize with her in that you still have to look at the numbers though, and with the likelihood of you needing to use something like that right because on one of the end of the spectrum, you ensure for nothing and you're taking, you're shouldering all the risk yourself. At the other end of the spectrum, you could ensure against everything, pay all the premiums, and you're gonna end up broke, especially long term disability. Like the premiums are really expensive. You we're between one and three percent of your anal salary, and so risk tolerance comes into play. Here's what you're saying, Yeah, you definitely have to take that into account. And so so this is more about I guess whether or whether or not you want to take on those long term disability payments, and just I mean, yeah, you start to add up those monthly premiums and then you start thinking, okay, so that's specific to whatever the exclusions might be included as part of that long term disability plan as opposed to and this is something that I've done, is just like, hey, can I instead take those dollars, invest those dollars aggressively over the years, and then you've got yourself a decent little nest egg that you can do anything with. Right, If you hit hard times, then you can use that to help you through that. If you don't it this hard times, then you can use that those funds. You can give that money away, you can go on a nice vacation, you can fund your kids college and so there's just additional avenues for that money to go, as opposed to one way premiums towards an insurance company when you're hoping that you don't ever have to take advantage of that insurance, but obviously it's there just in case you do.

00:05:51
Speaker 1: And the closer you get to full financial independence and just we know it's a spectrum, right, it's not a once or all or nothing thing. But the further you get along that spectrum, the less likely.

00:06:00
Speaker 2: You need it.

00:06:01
Speaker 1: Right, Because you're more self insured, you're more self insured, and that is something that we push people towards in more areas that their life. As insurance becomes more expensive, it feels like there are more kinds of insurance that are being pushed on us, and we have to be really careful about how much we're spending on insurance. Some point, some insurance products are like crucial homeowner's insurance, right, But can we even in that self insure more. Maybe long term disability for is more important, and you've got to spend the money for a few years until you've built up a significant enough ness eg To feel like you are self insured to the point where you don't need it. But it's just it's at least worth considering. And I do think she made some great points. It was worth bringing it.

00:06:38
Speaker 2: Up totally, So we give the story to make Yeah, she made some good points. I was gonna say, you saying that, maybe also think of context. It's not just about how much risk you're willing to take on yourself a context and whether or not. Let's say you are married. Let's see you've got a partner. What is their ability to go out there and become the main breadwinner? Right, maybe it's you, But if they have the ability to do that, Okay, well then maybe Okay, let's say maybe you have kids. Does that mean then maybe your you switch rolls a little bit? Right? If they don't have the ability to go out there work, Okay, that's a scenario that is a very context specific sort of question to ask as to whether or not it becomes more or less necessary or.

00:07:18
Speaker 1: Is there income discrepancy between the partners where the standard of living would fall significantly?

00:07:24
Speaker 2: Right?

00:07:24
Speaker 1: So, yeah, there's all of these contextualized realities. It's not an easy peasy decision like sure, let me get this really expensive insurance or no, I don't need it because I work with my brain.

00:07:36
Speaker 2: It's it's a lot more involved than that. That's true. All right, you're talking about groceries. Oh one of my favorite time to kick it off one because I love to eat. I like good food. Yeah.

00:07:46
Speaker 1: I had some actually reheated smoked pork but that I made this week.

00:07:51
Speaker 2: Oh it was delicious. How do you reheat it? Do you you do like fried rice style? Or you just kill it? Baby? Yeah? Yeah, that's what you get it all crispy. Okay, So this was a I don't even know where this story was. Was this some business insider? But basically they're talking about NBC, CNBCNBC, Sorry about that, CNBC. Essentially, so the key takeaway on this one. They were talking about how the number of essentially consumer goods that you buy in the grocery store are down compared to last year. Some of that has to do probably a lot of it has to do with inflation, but people are buying something like two percent fewer groceries and you're.

00:08:29
Speaker 1: Good like like items, yeah, like like ues. Essentially, is this is this money saving related? Is this o zempic related, Matt like or is this kind of.

00:08:38
Speaker 2: I So to me, this feels more like a business story as opposed to personal finance, right, because I hear two percent one point eight to be exact, and I'm like, okay, to me, that doesn't seem like a big deal. Especially and this is immediately immediately where my mind went, especially when you consider the amount of food way there are in American households thirty to forty percent. The EPA estimates up to fifty percent of groceries are lost to waste, just like household food waste, and so on one hand, I'm like one point eight. I'm sure from a business perspective, they're saying, oh, how do we get you know, how do we get our sales back up? People are buying fewer items. But for me, I see this and I think, well, on an individual level at least, I think there are just other levers that we can pull when it comes to ensuring that you're not throwing away jel, you reheated that pork butt or whatever, But what about the slimy the slimy greens and the curtain in the bottom of the produce bind that you've got in your fridge? Yeah?

00:09:45
Speaker 1: Yeah, well that's have you eaten those? That's what we're talking about here far like you have many of those right now, but if I did, I would probably eat them. That's when I go to buy veggies or fruit. I don't know, I'm weird. Ask my daughters like about the expiration date for what I'm buying.

00:10:02
Speaker 2: I will like lift up.

00:10:03
Speaker 1: At Costco, you know, in the in the cooler section, I will like lift up twelve boxes to get to the strawberries that are just a couple of days fresher, because and I mean they they like turn away and disgust.

00:10:14
Speaker 2: They're like, this is my dad, it's the same batch. I don't know if it's like at Costco, like if if they're in the same giant horb cardboard box. These are processed of some giant conveyor belt and the berries that are in the container at the bottom of the box. I don't think like five minutes newer.

00:10:30
Speaker 1: But the spinach, the spinach man, sometimes there's like six, seven, eight days where the expiration date is is different in different boxes. Really spinish, oh yeah, pay attention man and Spanish thinking about spinich. That's one of those things that like if you're like, if it hits the expiration date, it could be pretty nasty at.

00:10:48
Speaker 2: That point, yeah, you don't know for sure, you don't want anyway. That's that's just where my head went, which is uh, I guess a recommendation, not a recommendation, just my advice that would be to find ways to like one point a, that's one thing. But on the other hand, I'm thinking of different ways that at home we can waste less food by following recipes. If you're not so inclined to under you know, to be able to cook just like shooting from the hip at home, maybe that means bash cooking once. Gosh, you and Emily have done a lot of this with like don't you you'd like smoke chickens every Sunday, but just cooking multiple meals all at once, freezing them. If that's a way for you to not waste food or eating leftovers, actually eating the food that you've made so that just doesn't end up in the trash. Can.

00:11:34
Speaker 1: I think one of the other culprits too, is that people are just eating out more. And we've seen this right and left right that it's easier. The crossover happened a few years ago that people spend more eating out than they do on groceries, and it's not coming back like, and this is a way that we spend more money, and this is a reason why we're seeing people buying less food at the grocery store. You can blame it on inflation. I'm blaming it on lifestyle choice for most people, and they're saying, I'd rather spend money eating out, even if it costs a lot more. So I'm buying less stuff at the grocery store because I'm making less stuff at home. And ultimately, this is a decision that's going to impact your budget. So be careful how much money you spend eating out. Yeah, you might buy fewer groceries, but ultimately it's raising your food budget overall.

00:12:14
Speaker 2: Totally. Yeah. So there's on that note of groceries, there's a survey that showed that more folks are using their cash back and some of the different like credit card benefits that they receive to pay for necessities like groceries. And I think the article is trying to position this as like, isn't this terrible, But Joel, I'm gonna take the story and spend it a little bit because I think this is just an argument for the fact that money is just perfectly fungible and it makes me think that maybe there's a certain subset of folks out there who are realizing that, like, oh, I'm getting a little more responsible with how I'm spending. I used to always use my points and kind of ear market for a trip for vacation, which there's nothing wrong with that, But if you realize that, I think I actually do want to get a little more intentional with my spending. You take this points, you take the statement credit, you used it to offset you're monthly spending from the last statement, and then you can, I don't know, attack let's say a vacasion a little more thoughtfully, as opposed to like, I don't know, kind of like blow it on the dice, rolling it. See what happens opening your points within the credit card portal and seeing what you got and what your money You're like, I'm going to Vegas.

00:13:32
Speaker 1: Yeah, oh man, now I'm gonna spend even more because I'm going to waste my money gambling. I think you're right, Like I have no problem with people using I think for many people we're down. Like if you want to play the system and you pay off your balance in full and on time every single month, like go for it. The travel credit cards, there's some really good ones out there that was to chase Afire Prefer just how to really awesome sign up books. And if you're going to meet the terms and you're not going to spend more than you should, like, that's a worthwhile card to have in your wallet, especially if you're a heavy traveler. But I think for most people, keeping it simpler and more basic is probably the best way to go. And so whether that's a statement credit, whether that's like using the cash back to kind of pay make it cheaper for your your grocery built to kind of subsidize your grocery build, if you want to think about it like that, that's great. Part of it's yeah, like you said, it's fungible. Part of it is in your approach, like how are you thinking about where this money goes? And I think if we're really sensitive about our grocery bill, putting some of the money there, it might help it feel like groceries cost a little bit less just because we're using a credit card.

00:14:37
Speaker 2: Intelligently.

00:14:38
Speaker 1: The MX Blue Cash Prefer is one of the best cards if you if you feel like your grocery bill is too high too right, because you get that six percent cash back on your groceries. So that's a credit card can help. I guess if you use it appropriately as well to kind of reduce how much you spend.

00:14:53
Speaker 2: Yeah, six percent? Is it up on up to five thousand and spending? I would say it's nine? Is it nine? I think it's something like that. I could be up it all I know. And this is revealing a little bit about us and how much we spend on groceries. But we tend to hit that mark around halfway through the year. And it is now August and we have officially spent that much money. Wow. No, it's six thousand, by the way, six okay, six, not five? Yeah, no, nine, And the price is right game. I would have won that one, jeel. But in that case, yeah, I'm hopping over. I do love the Amex Bluecash Preferred. But I literally, as I was closing out last month, I told Kate, I was just like, hey, I just noticed we're not earning the six percent anymore on the groceries. Go ahead and pull that card from your wallets through everything on the on the robin Hood card.

00:15:42
Speaker 1: But there was another article about just like premium credit cards, and I think this is one of those things. We're seeing more and more of them. We've talked about how the the annual fees are going up and up and up on these cards, and they're especially to like upper middle class people. It feels like, Oh, I'm going to get so much value out of this. Look at the look at the sweet airport lounges. I'm going to be able to go. I'm going to go into uh because I have now this premium access and I get to get a nice little beverage before my flight or something like that. I think it's really important before people sign up for those, though, Matt, to realize, well, to look towards the past year, well, how many how many flights did I take that I actually show up to the airport pretty early? Am I hanging out at the airport? Like my sister loves to hang out at the airport. Those get the lounges, Oh yeah, dude, Yeah, But they travel eight or nine times a year and they're getting their way early. They're taking full advantage. It's worth every penny. But for me, like who travels once a year, and if I am, I've got kids in tow and stuff like that, we're not getting their hours in advance with the lounges.

00:16:45
Speaker 2: It's just hours early getting a bloody Mary. Can I get like a little Shirley temple for the kids too? Exactly exactly? Oh my gosh.

00:16:53
Speaker 1: No, it's like is it worth it for you and how you live? And you got to kind of like, don't just assume because it meets one or two requirements or it's it's got one or two benefits that you like, that it's still worth getting that card. Totally agree not to mention the fact that folks get tempted into higher levels of spending with brands that they don't even yeah, necessarily frequent. Right, It's like, oh, you get a Peloton the Peloton credit, and all of a sudden you're doing business with Peloton when otherwise you're like, well, I kind of just do that at home.

00:17:24
Speaker 2: Stretch.

00:17:24
Speaker 1: YouTube stretches that like that jol does. That's for that are free on YouTube. I can look to them people if you want them.

00:17:30
Speaker 2: They're great. So that's the whole thing, actually being honest with yourself and addressing or recognizing whether or not you are being tempted into spending with like these luxury brands when otherwise you might be perfectly happy with the way that you had been spending.

00:17:47
Speaker 1: Well, I just wanted this is another one of those words that just got made up, you know, like, oh yeah, I think this is it to make up new words. It's funnish, Yeah, it's funnish, But dude, all the fun stuff is more expensive, right, Like this was ad nauseam what people talked about with the World Cup. It's so expeditive and likes only the richest of the ritch can go to some of these games. I saw even that a few of the big name music acts are trying to Like Coldplay was one of them. Charlie XCX. I don't really know who that is except for the Brat summer thing. I think that was her thing was that last summer. But she they're trying to release like twenty dollars seats, a very very small amount to curb kind of how expensive it feels. But they're so like, think about how many people go to a cold Plate show. That's it's probably thirty thousand people at a Coldplay show. I'm guessing they haven't announced, but I'm guessing it's like two hundred tickets that are toenty bucks.

00:18:39
Speaker 2: And everything else is still just to be able to say that, like, hey guys, we release some of those affordable, all the level tickets for the price conscious folks out there exactly.

00:18:47
Speaker 1: So I don't know that it's actually going to make a difference in most people's lives, but man, it does feel tough out there for people who want to have fun, and it feels like experiences sporting events. Think about those Nicks playoff tickets. How expensive those were? Concerts these days? All of the flooding events, it's crazy expensive.

00:19:05
Speaker 2: Yeah, So okay, My thoughts on this are that this is a holdover and I hate to be the one that's still banging this drum or whatever, but I feel like this is still a holdover from the pandemic, right, Like, first of all, you tell people that you can't hang around other people because they're going to kill you, so that does something to you. But then secondly, as the economy shut down, the government's just like fire hosing cash into people's checking accounts, and all of a sudden you get to this because when did all the start, When did these insane ticket prices? When did all this happen? This was post pandemic, This was sort of the knee jerk, the reflex of sort of corrective action, right, folks were at home for a long time, and then then a year later it's like, oh, wait a minute, now we've got we've got more money than ever. We can go to concerts. You see ticket prices skyrocketing like that. But I think the big question is why has it continued? And I think it's I think it's social connection at the end of the day. But I feel like it's two sides of the same coin, right, which is I think more time, Like we're spending more more time atomized, not hanging out with other people, not being in community, not being a part of sort of like civic clubs and the Putnam bowling alone. Right, this is that all over again. And so there's a healthy part of Oh, I want to go hang out with my friends, Let's go to a concert. That's amazing, Like that's such a great healthy thing to do. As we create these memories, we have a ton of fun. I feel like this is an argument that you can get behind, Joel. You love going to concerts. It's a ton of fun for you. But then the flip side of that is the fomo side of things, where there's just like that anxiety that goes into someone feeling like, oh, well, everyone's going to the what coldplace you know concert or whatever the guy from HR or the lady firmation of a reference to that in the in the past spring, they're going, maybe I should go too.

00:20:49
Speaker 1: Nobody's starting that Matt that didn't get any viral attention. I don't know what you're talking about, and like.

00:20:54
Speaker 2: That to me feels like the sort of unhealthy side of it as well. For both of those reasons, I think that's part of why we've continued to see higher ticket prices, whether it's concerts, whether it's sporting events. But I'm assuming that you're probably down, you know, to maybe spend a little bit more of your entertainment dollars towards sporting events or to concerts.

00:21:15
Speaker 1: Right, not really sporting events, but concerts, Yes, ish, because I will say the price still matters as to whether or not I'm gonna I'm gonna pay it. Like there's a band that I liked that's coming in October, and I was like, hmm, yeah, if it was like in the fifty to sixty dollars range for ticket, I'm interested to see them at that price point. But they're not one of my all time faves. And so I think tickets were like one hundred bucks. I'm like, yeah, no, I'm not gonna do it. So I think we just need to be willing to say no more often, Like it makes me think about There was this article about how now that Spirit Airlines has gone, people are taking the bus more to get where they want to go. I've ridden the megabus across the Southeast before. It saves a lot of money. Like you love the buses.

00:21:57
Speaker 2: Yeah, it's great, it's.

00:21:58
Speaker 1: A great way to travel. I'm glad more people are picking up on it. But it doesn't mean because just because it's more expensive that you always have to say no. You can just pick and choose and say listen, instead of going to like eight concerts a year, I'm gonna go to four. I'm gonna go to the ones that I really really care about. Or instead of taking Spirit air which is very relatively inexpensive, I'm gonna I'm gonna take the bus. I'm still going to get there. I'm just gonna find a way to do it for less. And yeah, do I wish that concert tickets would go down in price? Yeah, but is Ticketmaster in charge of that world, and will concert tickets go down in price? No, I'm a realist, So it's just yeah, it's just one of those things. This is gonna, I think, probably annoy us for years to come.

00:22:39
Speaker 2: Yeah, okay, Well, speaking of buses, I know, I don't know if you would are gonna like spend some time talking about how great Mega bus is, but for meanwhile, since I've ridden it, but remember it with fondness, I'm just a snob. Man. I've never ridden on a bus, and I think that my I think my bus riding days are behind me. I mean I take that back in college, like I would alway take the bus, right. We had an awesome bus transit system at UGA, which evidently stinks now evidently they've reduced the some of the routes and stuff. And somebody told me recently they're like, oh, man, nobody rides a bus anymore. I'm like, oh, it's too bad, Like everybody used to ride the bus. That's just like how we did it. Talk about relational connection, mass a good place to hedy, dude, I'm telling you, like, can you just strike up a conversation with someone random? Like I literally would do that all the time. But as far as traveling to other cities, they're talking folks who were like, oh, yeah, I took a took a trip from upstate Maine down to New York City or something like that, and I'm just I think, I don't know. I just have a hard time the visioning getting to the bus stop, waiting getting on board with a bunch of other folks. I feel like we're going more and more in the doria. I just feel like we're going more in the direction of uber and lyft. Right Like that thing comes to me. Somebody needs to create like an uber and lyft long haul or something like. I'm sure you can do uber or lyft to another state, but I don't know, that's probably gonna be a crazy expensive.

00:24:02
Speaker 1: The prece point on some of those bus trips is pretty pretty great, and some of the accommodations on the buses look like they've gotten much much better. Like they've got Wi Fi and they've got tables that face tables in the middle of like two seats on either side, so you can like create like a little cabinets or something.

00:24:18
Speaker 2: Selah.

00:24:19
Speaker 1: So, I mean, I know you're fancy, but there's a lot of other folks out there who uh, you know, men of the people like me, women of the people, they'd be willing to.

00:24:26
Speaker 2: Dude, I don't want to hear it. Tell me that the next time you it's like a hostel. It's like you being like hostels are the best, the best, and like they are good for a certain period of time. Like I'm so glad that when I was younger that I stayed in plenty of hostels, sleeping in a room with like twenty other people for the really cheap spot, you know, And it's just it's rough. I've got some great stories, great memories. But guess what are you staying in a hostel anymore? When you travel with Emily or your kids?

00:24:51
Speaker 1: You're not same here right Like I'm place, but I don't know if I'm beyond a bus trip yet.

00:24:56
Speaker 2: Really, Okay, well, how about this maybe all time staying this, and the next time you take a bus trip, you let us know and we'll spend we'll spend plenty of time talking about how wonderful it was, just what your thoughts were for now, how much what you were able to say?

00:25:12
Speaker 1: We got more stories to get to. Okay, Americans, it turns out, are only getting worse at personal finance mat I don't know about you didn't surprise me. There's there's this new TIAA survey and basically they found that financial literacy has dropped to a ten year low. The average score on their simple quiz and by the way I went through it to take a look, was forty seven percent.

00:25:33
Speaker 2: So did you take the quiz? Yeah?

00:25:35
Speaker 1: Dude, it was so easy like it was. It was not like because sometimes the Wall Street Journal will publish articles and they're like, can you test can you try this quiz out? And sometimes the answers can be misleading and it feels like there's two right answers and they're like you were wrong on that one. Yeah, But this one was like it was something I would hope anybody who graduates high school would know the vast majority of these things, and they didn't.

00:25:57
Speaker 2: They dropped from like fifty two out of forty seven yeah, last year to this year. Right, it's just like, oh, it's not great. I never heard of this thing. It was called the Personal Finance Finance Index and I did not take the quiz. I'll see how I do after I sawn off with you.

00:26:13
Speaker 1: Like part of me holds out this hope that personal finance classes in high schools becoming mandatory is going to help fix this problem. I also wonder you and I've talked about, like, it's great that it's mandatory, but so much of whether how effective these classes are going to be depends on the teacher, depends on the curriculum. So I would hope that these classes would make it a goal that everyone going through those classes would be able to get a minimum of like a ninety percent on a test like this. And I do think these are just some of the basic questions. We'll link to the quiz in the show notes, but I feel like that these are some basic questions that everyone should be able to answer, and to see that people can't even get fifty percent of them right is like, is harrowing. No wonder people are bad with money.

00:26:55
Speaker 2: Yeah, So on the note of quizzes and surveys, there's another survey that said a third of folks have more credit card debt than they do retirement savings, which was pretty shocking. So the story led with that, and I thought, there's I don't know, man, that seems maybe it's just overblown or something like that, And I went digging through the details a little bit, and I was thinking, okay, I could pick I could totally picture a twenty two year old. Are they going to have more credit card debt than retirement savings? Absolutely? Yeah. I was disheartened to see that they weren't serveying people as young as eighteen or twenty two or even twenty five. It started at thirty year olds, which that's when and allthough it's to seventy nine year olds, and so a third of those folks between age thirty and seventy nine have more credit card debt than retirement savings. That's that's tough to stomach.

00:27:45
Speaker 1: You gotta flip the script, Matt. People can't be having ten thousand dollars in credit card debt in five thousand dollars in their investments. And if you you know, to get that kind of credit card debt racked up, it takes time. It takes months, and to kind of write the ship, it's going to take a while too. But it's your're sure to get started to have a plan to pay off the credit card debt and then to get the full match in your formal Okay, you've got to have like start making small decisions like you know what, no takeout for the next three months while I'm paying this credit card debt off intensively. They're just all sorts of changes that you have to make both mentally and then with where your money's going in order to be able to fix that. Because I think for a lot of people, they hear that, they're like, that's the situation I'm in, they get despondent, and man, that's not gonna help either. I think that we don't want to like shame you and say you know you're you're an idiot, can't believe you did that. This is like you are in company with a third I guess of investing Americans, so you're not alone. But there's changes that have to be made so that you can get kind of back on proper footing when it comes to your finances. That's right, all right, let's take a quick break, man. We got more to get to. Oh before I like do the whole pitch, though, what I need to do is hop over here to the sounder board and make sure I've got that cued up. But we've got more to talk to.

00:29:00
Speaker 2: For instance, we're gonna talk about Social Security running out of money. We're gonna talk about people hating on homeownership. We'll get all that more right after this. Grooming my mustache. Sorry, okay, that's vanity right there. Keep it groomed. Oh do you have any like bird nests growing up in Internet? Do you have a mustache comb? Yeah? No, it's tiny scruble. Yeah. Oh okay. I don't keep it in my pocket, but I have it in my bathroom at home. Are you gonna turn into one of these guys that has like no mustache wax and you're like going to grow it out? And do you remember when I used to have a mustache parents, but not that much? Yes, I do. I thought you had a great mustache. Your family disagreed, though, thank you. I'm glad you appreciated it anytime I bring it up. Well, first of all, Kate's like, well, you both can't have mustaches. I think that's true, though that kind of gives a different vibe to the show. I agree. I think if we both did, people would be like two, those guys are just too much. They overlapped too much. Yeah, like our friend Dan, he's also got a great mustache. But if he was your co host and you're both sitting there with your then it looks silly. But if one of us looks like me, one of us looks like you, feels a little more appropriate. I was gonna say, if you didn't have a mustache com I'd like get you one for Christmas, or something like a nice tortoise shell. I bet there's some nice ones out there that you can get. I guarantee there are nice waxes, nice poems. You got to talk about social security.

00:30:29
Speaker 1: Yeah, let's get to the Ludacro's headline of the week. This one comes from Yahoo Finance, and the headline says, will social Security go broke in twenty thirty two?

00:30:37
Speaker 2: Here's what's happening.

00:30:39
Speaker 1: And the headline is frustrating, But it's more than anything. What's happening with social security is frustrating. And this is an update that kind of happened Matt while we were out of town a few weeks ago. At this point in time, we've talked about it. We had Mike Piper on the show to talk about social security and the state of social security.

00:31:00
Speaker 2: The system in.

00:31:01
Speaker 1: General is troubling, and our politicians are elected officials unwillingness to address the issue is even more troubling, Like there are changes we could make, and the sooner we make them, the better. That could kind of iterate to solve this problem, or at least to mitigate the problem, make it less, make it less bad in terms of how things are going to shake out, make it more better, make it more better.

00:31:23
Speaker 2: Let's make sucure security more better.

00:31:25
Speaker 1: But the trust on is going to drive in twenty thirty two, which is what I think, one quarter sooner than it was previously expected for Q one thirty two versus q Q four thirty two versus Q one twenty thirty three. Right, And this is just going to keep getting more headlines. It's going to ramp up confusion, and people are just going to especially young people, young listeners, to how the money. I think they've already gotten the memo. They've got the message social security is not going to be there for me in the way that it was for my parents. And I don't think they're wrong.

00:31:54
Speaker 2: No, I agree. I think more folks our age have been wising up to it. It's it's a large part. And yeah, it's interesting because I don't think that there's as much concern from younger generations like our age and younger are essentially counting on it less and less. Right, It's like a spectrum, like if you are in retirement and that's your only source of income, Yeah, you're like, what's going to happen to My payout is going to get cut by almost twenty five percent. I think it's like twenty two or twenty three something. I think twenty five or twenty six percent. Yeah, oh really, Oh I thought it was a little bit less in that. But that's assuming that the government does nothing. And demographics show that we have a larger and larger percentage of voters who are older, which means it is going to get addressed somehow. Like there's for a while I was thinking, oh, they might just let this thing kind of sunset, like right off into the sunset. Nobody has to touch it, nobody has to get right drug over the coals, wracked over the coals or whatever for being the one that increases taxes. But at the same time, you've got a larger and larger block of folks who are counting on Social Security. But yeah, fact is, it is a real thing. I think what's important to note is that this is this isn't clickbait like the trust fund will run out, there will still be people paying into it, so it's not like it's drying up completely. So it's a little misleading there. But there is a structural issue that comes when it comes to social security, the future of it, how much it is we should be counting on it. And in the past we've talked about how or maybe you and I have talked about it, like when we've talked about sources of income, and you're like, I've got the stool, and you've got one leg that's this, You've got one leg that's that, and think about social Security. Perhaps it's just one leg of your retirement stool, but a weaker a weaker leg, right, it's not as sturdy as it once was, and so your other legs have to be even sturdier. Yeah, to make up. Like when you lock.

00:33:53
Speaker 1: We've talked about this before, when you log into social Security dot gov and it predicts what you're you know, what you're going to have in terms of a Social Security check when you hit different retirement ages. You can don't plan for that full amount, you know, plan for twenty five thirty percent less than what social Security dot Gov is telling you. Because especially like it's we're it's it's not only the Social Security Trust Fund is running out. It's so we're heading in the wrong direction. With more and more government spending, people living longer, people having fewer kids, and fewer.

00:34:23
Speaker 2: People paying into the system, paying fewer payroll taxes.

00:34:27
Speaker 1: It's only going to become a more and more unhealthy system. And the longer we wait to address it, yes, we can still find ways to put money into the system, but as a country with as much debt as we have they're trying to address the issue, it becomes more and more tenuous. Right, And so, yeah, this is just something to be aware of. And it's just again a call to as a DIY investor, be very intentional and not rely, not overly project, and rely on what Social Security is going to do for you.

00:35:00
Speaker 2: That's one reason that I'm encouraged by more and more folks who are saying, well, why why would I buy a house? Right? That's another story. We came across somebody who's writing I can't remember where, but essentially he was just like, I got the money I saved up, but I'm choosing not to purchase a home for one reason. I don't like the house I can afford. It's in a neighborhood I don't really like. But secondly, my net worth is growing more by investing those dollars. And you are seeing people who are investing more than dollars more their income. But that's the trick you need to offset, You need offset. I'm thinking about home ownership. Why has it been the number one way that Americans have built their net worth over the lifetime. Is because it's a forced method of savings. You are required to if you want to continue to live in that house, right, And it's one thing for someone to say that like, okay, well, hypothetically, if I were to invest, you know, I'm going to see my mind to increase out a faster at a faster rate, at a faster clip. But there's a difference between being forced to because you're living in the house, and if you don't, you get kicked out of that house. As a disclosure, it's a face. It's a savings treadmill, right, Like you are on this thing, and no matter what you are, at a certain pace, you're clipping along and you're socking money away. You're building equity there in your home. Can you do that on your own you need to. We just talked about why you need to because of social Security not necessarily being there in the same way that it is currently, but you need to. And what I think the four to one k millionaires is one of the more encouraging notes where people are signing up for that it is automatically being taken out of their pay out of their their paychecks, and they're not thinking about it, right, Like that's another mechanism and is a great reason why it is that we are actually seeing so many four one k millionaires. But you have to be so intentional about that, Like that's what's so clutched. That's the key because if you're not being intentional about that, yeah, you're going you're not gonna have nearly as much money on hand.

00:37:09
Speaker 1: I think there's some tried and true, like realities of wealth building that remain steady generation after your generation, and then there are other ways in which you have to say, what's the reality I'm facing and does it still make sense to do it the way my parents did it? And I think for more and more and more young people are saying, especially if they live in higher cost cities, especially with the discrepancy between mortgage what they pay in a mortgage is what they can pay in rent for something very similar. They're saying, hmm, doesn't really make sense the way different my parents doesn't really make sense the way it did eight, ten, fifteen years ago. And they're not wrong. And I'm not saying that the housing market won't change. And because right now, like home prices compared to the average salary, like there's a bigger discrepancy than there's been in a really long time then and that I'm not saying that can't change and level out.

00:38:04
Speaker 2: I think it can.

00:38:04
Speaker 1: I think the housing market could plateau for a while and it's going to look more appealing and appetizing to buy a home potentially five, six, eight years from now. But it doesn't like buying a home, you know, conditions be damned to Like that's not intelligent, that's just that's just trying to relive the playbook of your parents when the playbook doesn't make sense in the same way. It's like in the NFL, as they changed the defense, you got to change what you're willing to do on offense. And maybe you need some more head fakes and hail mary's and post routes.

00:38:32
Speaker 2: I don't know, Matt.

00:38:33
Speaker 1: I don't know enough about sports to really say, but this is like somebody's been brushing up on is Madden. This is a point where you call an audible you know what I'm saying, and you make a change to kind of the scripted way that it's been done. And for a lot of people, I don't think it means home ownership can never be a reality. But you're just saying, Hey, given the facts on the ground, I'm going to prioritize investing right now. Maybe in maybe years down the road, I will revisit this decision. I'll be in a better off financial position. I'll be able to actually afford the house I want if at the same time, the housing market experience is a little bit of a correction totally.

00:39:06
Speaker 2: Yeah, the game has changed, which is why that's what you're talking about, right You're talking about being flexible because the game has changed because interest rates are so sick and high, and that's one of the ways that we see rates come down. Well, all of a sudden, housing homes in particular get you know, start getting a lot more affordable. And there's another article we saw that said that Americans were forking over an extra sixty five billion dollars because they were going essentially with their buddy, Like the first it's like, oh yeah, I know a guy, I know a guy that does mortgages, and they're like, oh yeah, okay, and they go with him or her and they don't get another quote. And sixty five billion dollars is so much money.

00:39:46
Speaker 1: So much race of money spread over you know, many hundreds of thousands of borrowers, but are millions of borrowers, so a little bit for everybody. But we've talked about how that adds up too.

00:39:57
Speaker 2: Man.

00:39:58
Speaker 1: Yes, not shopping around like we shop around for everything. It's you know, except for the most expensive thing that could Like if it believes you an extra one hundred and twenty one hundred and fifty one hundred and eighty dollars a month because you didn't shop around and get that better mortgage rate through your local bank or credit union.

00:40:15
Speaker 2: Or talk to most like the credit union.

00:40:16
Speaker 1: Yes, yeah, yeah, Like we've talked about this when we're looking at some of these adjustable rate mortgages, Like, man, some of our local credit unions have far better rates than we've seen anywhere else. And if you're just like taking your realtor's recommendation for a mortgage lender, and you're just going straight there and you're not asking any questions and you're not comparing apples to apples. The money you could leave on the table, could it could be way more than your Netflix subscription every month? Think it costs you, like, you know, ten times your Netflix subscription.

00:40:43
Speaker 2: Yeah, you want to talk about other ways that folks can get discounts, let's see on their home insurance. Yeah, additional ways to make your housing cost a little bit less. So I loved this.

00:40:55
Speaker 1: There was an article I think it was in Baron's I don't remember kipling her about DIY upgrades that you can make. And one of the things they mentioned was even just like you know, your home insurance company is going to ask you what what certain questions about your house and certain changes that you make can impact you in a beneficial way when it comes to how much you pay for homeowners insurance. So one of those things is having a home security system, right and back in the day, that meant calling this one giant company who would install it for you, and they would put you in this nasty little contract and they would charge you like fifty five dollars a month, and if you tried to get out of that contract, they would break your legs or something like that. Right, that was kind of their tactic. It was the scare tactics and stuff like that.

00:41:37
Speaker 2: Then alone came simply safe.

00:41:39
Speaker 1: Were they the first? The first empty safe? Was the they started it all? And they just the revolution? Yes, And so even if maybe they're not the absolute best choice for everyone anymore, they're still a great choice worth considering. I think the having that competition thrust into the market, it opened up a whole nother space of like DIY homes security that didn't really exist before. You had to have a professional come to your house and install the cameras and blah blah. We don't do that anymore. Right, Like, it's like plug and play with tons of different companies out there selling you equipment for a pretty low cost and then selling you the monitoring on a monthly basis for a heck of a lot less for like ten percent. You know of what the big company used to charge. But this is an inexpensive thing that you can do to your home that actually could save you money over the long haul. So it's worth asking your homeowners insurance company, Hey, what can I do to save money on the costs as these costs of risen And if okay, if I got a let's say a cheap home security system, how much would that reduce my homeowners insurance bill? And you might find that you'd more than cover the costs of that security system you're installing in a year. Right, Like, it's I think it's one of those things more people should should consider.

00:42:53
Speaker 2: Yeah, yeah, it makes me think about just other ways that you that a lot of folks when they're hit with a surprising new PREMI increase or maybe the like if they got a teenage driver, it's just like, oh my gosh, how much are we gonna and this these are waters that we're starting to We're still a few years out, but I'm still I talk to friends all the time and they've got teenage drivers and they're just talking about how much it costs, and they're looking for every good student discount possible. Right, But when you have home insurance rates that slowly creep up, Yeah, it's the boiling it's the frog and boiling water. Man. You just you get used to it and you're like, oh, I guess that's just what it is now as opposed to finding other ways to make your homeowners insurance costs less, like like installing a trampoline. I'm pretty sure that makes that brings down the cost of your homeowners insurance, does Nigel? Sure? Right?

00:43:42
Speaker 1: Yeah, I don't know we have a trampoline. I know you do too, And I'm yeah, I don't even remember if they asked me the question.

00:43:47
Speaker 2: About do you have it. I don't know if they did either. I don't know why I thought of that. I was just thinking through, like what things on our property are make us more of a liability risk perhaps, And I'm like, oh, we do have a trampoline. You know you got some of these different Yeah, anyway, did you see.

00:44:02
Speaker 1: The article about the security deposits the fintech companies that are like allowing you to essentially pay an annual fee or smaller sums so that you don't have to pay as big of a security deposit if you're renting.

00:44:14
Speaker 2: If you're I did not, so fill me in. All right.

00:44:17
Speaker 1: So this is fascinating and it's terrible because just like everything else in modern America, there are fintech companies coming down the pike to try to help you out in a way that like where you have to pay less money in upfront, but ultimately it's going to cost you more in the end.

00:44:38
Speaker 2: And so these these.

00:44:39
Speaker 1: Products function kind of like insurance, like we're talking about where they are. You know, the security deposit this is this is gone now once you've paid this company and I forget what I forget what this company was called. I can try to look it up. But like these third party services charging you less money so that you can and they'll pay essentially the security deposit on your behalf. But if something happens, like to the property while you're in it, you now there's another party you're dealing with, and at the at the same time, like what you paid them, you never get that back. Let's say you kept the home and pristine condition and you moved out, like you don't, you don't get this back. So it's it's instead of a security deposit, this is like an insurance product that you're buying. And the National Consumer Law Center dug in and they basically said, hey, these put tenants in a worse financial position when you use when they use products.

00:45:29
Speaker 2: Like this, so as opposed to saving up on the front and having the cash on hand to be able to actually put the deposit down what you would most likely get back if you did keep the place, yes, in good shape. Oh I don't like that man. This is it's just like another way of breaking up these large, larger sums of money into monthly payments. It's like pm I, but like for rent deposit as opposed to a private mortgage insurance.

00:45:54
Speaker 1: But yeah, and it's just remike me too as a renter. To protect yourself, will one save up and have the have the security deposit, have all the money you need to make that happen, along with moving expenses, along with an emergency fund, but also take pictures when you move in and when you move out so that you document it, because there are some shady landlords out there too who will be like, yeah, you did a fifteen hundred dollars worth of damages. Here's the three hundred dollars from your security deposit that you know that we didn't need. And you're like, what, I didn't do anything, And then you're in some sort of legal dispute and nice, at least prove.

00:46:29
Speaker 2: That you didn't do anything. Yeah, yeah, it's a much stronger case. You want to talk about water. Should we talk about how waters get more expensive? We got tired for that.

00:46:37
Speaker 1: Have you noticed that water bills are going up? I feel like this has been happening for years now, that a little bit. It's not just electricity prices, it's water bills too. Yeah we so okay, So yeah.

00:46:48
Speaker 2: This is the story basically talks about how, generally speaking, I mean water, it's increasing at a faster clip, at a faster rate than consumer spending inflation just across the board, which I mean, I don't know, everything's getting more expensive. I did find it interesting that they were sort of cherry picking some extreme cases though, some instances where oh this the reservoir is empty, and it's like, okay, yes, we've got some serious problems when it comes it comes to the kind of water and the rates that we're able to pass along as the municipality to our residents and to our customers. It makes me so thankful for and I don't even know if we where we live, if we get our actual water from Atlanta, but it makes me think about the giant works project that they did where they drill or Mike, remember the name of the of the drill. They bored a tunnel from the river all the way to this reservoir, and it changed our days city days on hand water from like two or three days to like thirty, which I'm like, that seems responsible. Good job city there, right, Yeah, And so on one hand, there is not a ton that you can do when it comes to a when it comes to the kind of infrastructure spending that has to take place. That's why a lot of it is taking place, right, It's just these systems that have been in place for a long time. They need to be replaced. You can keep that in mind, But I doubt many people are going to change where it is that they're moving to based on what kind of condition it's. It's sort of like looking at the an Hoa and looking at the reserves and being like, hmm, how are we doing There's not there's not a whole lot of folks doing that when it comes to the city that they're living.

00:48:31
Speaker 1: No, but they should be. In the case of an Hoa, probably should be exactly the city means the water, you know, and how how what you know? What what does that look like? But when it comes to individuals other there's there's bigger reasons that you're moving to a certain city or to a certain district, whether it's schools, jobs, to be closer to a family. But on a personal level, there are absolutely things that you can do. And that's what we talk about here on the show.

00:48:55
Speaker 2: The things. We're not talking about policy, we're talking about what you can do as an individual. Do you say, like to take your showers? Well, literally, when Georgia was going through a drought many years ago, the then governor, they were he like, he had like an address to the state and he and I'm still remember I can say it the way he said it, take a shorter shower, Like that's the way, Like that's what he said to people, and he's not he's not wrong. Like the shorter shower. Okay, shorter showers, they take no shower at all than the shorter shower.

00:49:22
Speaker 1: Now he didn't say don't bathe, which I appreciate because people would have probably revolted. But replacing your toilet lofo toilet sped in. The water company will pay you, we'll buy the toilet for you basically to do that, and then you're able to save some money or not having a fancy lawn right that requires watering. There are all these ways that you can around the edges at least save on your water bill. I don't I don't know that you're going to like cut it in half, right, but you might be able to get to lop fifteen twenty bucks a month off of your water usage if you take just a couple of measures and you did that don't involve smelling when you show up to work.

00:50:01
Speaker 2: It's true. It makes me think about my parents' house, and they're like, they do the exact opposite. They're just like, oh, I love it when the water flows. So like my dad, he takes much pride in the water pressure at our house. And I will say, like, you get in the shower there and like it feels like a tingly massage. It's insane just how much it just cuts through the hair. But one of the downsides of that, and I told him the last time we were talking about this, I was just like, you know, remember that time that the water filter that was on the outside of the fridge cracked and water went everywhere and kind of ruined the floor. I was just like, I wonder if that has anything to do with the fact that the pressure going to the all of our appliances all to all of your appliances in the house are like, it's basically twice what it should be. He's like one of the regulators or whatever that's called, right, Yeah, so, so modern plumbing codes, it's the PrV. It's the pressure reduction valve or something like that, and it's supposed to be set at a certain level. But either older homes that were built before that was required either don't have that, or sometimes people get down there and they increase the pressure. And I'm just saying that that also leads to other problems down the road, Like your valves on your faucet, it's not made to handle that kind of pressure as well. So not only are we talking about you on a daily basis using more water, but also just the premature failure of a faucet, of a valve on the toilet or something like that, you know, like the failure. That's what my parents called me, Matt. Oh no, you didn't. You didn't fail to launch my friend. But yeah, so that's that's the story about water. We won't get into how I'm spending I'm buying big jugs of bottled water now for my for my expresso machine. Oh okay, did I tell you that is it's that's the most expensive way to pay for water apparently, and a giant thing something about the water chemistry. But we will connect that it's worth it because you got to do that. I think, dude, this is my new craft beer equivalent. I think I'm willing to say that here on the show. Now that's I'm spending more of my premium top dollar on. I mean, I already spent it. But we were just talking this morning about dabbling and getting into the higher end coffees because I can tell the difference, and I'm like, hey, I'd rather do that than by another four pack of some really nice beer. I think the espresso you made me before our trail run was delicious. That was this morning. Literally did you enjoy that? That's so good.

00:52:26
Speaker 1: Nothing puts a pep in my step makes you want to run up a mountain like that. So yeah, that's gonna do it for this episode. Yeah, and again, we are on If you're listening to this on the audio feed, awesome, thank you. But we're also on YouTube. You can check that out. We'll put the link to our new YouTube channel in the show notes. You can see our beautiful smiling shining faces over there. If you do, go over there, hit the subscribe button and like hit the thumb leaees, because then that tells like the YouTube overlords that like our content is worth watching and they matter like way too much in our society these days. So tell them, tell them we're okay.

00:53:01
Speaker 2: Yeah, we're okay, We're okay. All right, that's gonna be it for this particular episode. Buddy. We hope everyone has a fantastic weekend. We'll see you back here on Monday, so Buddy, until next time, best friends out, best friends out. See you later, Buddy later